Amedeo Romano v DP World Melbourne Ltd
[2023] FWC 394
•21 FEBRUARY 2023
| [2023] FWC 394 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.394—Unfair dismissal
Amedeo Romano
v
DP World Melbourne Ltd
(U2022/11300)
| DEPUTY PRESIDENT BELL | MELBOURNE, 21 FEBRUARY 2023 |
Application for an unfair dismissal remedy - application dismissed pursuant to s.399A and s.587.
On 27 November 2022, Mr Romano made an application for an unfair dismissal remedy against DP World Melbourne Pty Ltd (Respondent). It was not in dispute that Mr Romano was dismissed by the Respondent on 7 November 2022. What was in dispute was whether the dismissal was unfair.
The issue I must consider for this decision is whether or not the matter was resolved by way of a binding settlement agreement reached at a conference held before me on 6 February 2023. The Respondent contends that a binding settlement agreement was reached and, therefore, the matter ought be dismissed pursuant to either of s.399A or 587 of the Fair Work Act 2009 (Act).
Factual background
On 27 January 2023, the matter was allocated to me. On 31 January 2023, I issued directions to the parties setting down a timetable for the filing of evidence, as well as listing the matter for a mention hearing and possible conference at 11:00am, Monday, 6 February 2023.
On 6 February 2023, the mention hearing before me took place by Microsoft Teams. Toward the end of that hearing, I inquired of the parties as to whether there was any prospect that the matter might resolve. I observed to the parties that normally before a matter is allocated to a member of the Commission, there has usually been a chance for the parties to try and talk and reach some form of settlement but that had not yet occurred in this matter.
Mr Romano confirmed my understanding and indicated that that was what he was “hoping for” I then asked if the Respondent was happy to see what we might be able to do to resolve the matter that day if that was an option, and the Respondent indicated they had been open the whole time for that opportunity. After a brief discussion where I confirmed with the parties that any private conference would be on the basis that I would continue to hear the matter if it did not resolve, we moved into private conference.
Those present at the mention hearing and through the conference were Mr Romano, for himself, and Ms Kathryn Winter (Employee & Industrial Relations Manager) and Mr Chris Harris (Human Resources Manager) on behalf of the Respondent.
I return to the detail of the conference below but, for present purposes, there was discussion about settlement that included the Respondent indicating it would prepare a written deed. Later on 6 February 2023, the Respondent sent Mr Romano an email containing a deed.
On 7 February 2023, Mr Romano contacted my chambers advising that he has not signed the proposed deed and wishes to proceed with his unfair dismissal application. Through chambers, I corresponded with the parties that day and listed the matter for further mention on Wednesday, 8 February 2023.
At the mention hearing on 8 February 2023, the Respondent made an oral application pursuant to s.399A of the Act for the matter to be dismissed on the basis that a binding settlement agreement had been reached. I waived compliance with the Fair Work Commission Rules 2013 and accepted the Respondent’s oral application. I then issued directions, requiring the Respondent to file and serve any material by Friday, 10 February 2023 in relation to the dismissal application and for Mr Romano to file and serve any material he wished to rely upon by 14 February 2023. The Respondent filed its material in accordance with my directions, in which they sought for the matter to also be dismissed pursuant to s.587(c) of the Act, on the basis that, in light of the concluded agreement, Mr Romano’s unfair dismissal application has no reasonable prospects of success.
On 14 February 2023, Mr Romano requested – and was granted - an extension of time until 15 February 2023 to file his material and I also communicated with the parties for a hearing date. A hearing date for the Respondent’s dismissal application was subsequently listed for Friday, 17 February 2023.
At the listing on 17 February 2023, I resolved by way of a preliminary matter to proceed by way of a determinative conference: s.398 of the Act. After hearing from the parties, I also granted the Respondent permission to be represented by Kingston Reid. I record here that I was satisfied that there was sufficient complexity that the assistance of legal representation would allow the matter to be conducted more efficiently and I also note that the Respondent’s employee with primary carriage of the matter was intending to give evidence.
Turning to the evidence filed, the Respondent filed a statement of Ms Winter, as well as supporting written submissions. Ms Winter’s statement was primarily directed at providing evidence of the negotiations at the conference before me on 6 February 2023. That evidence contains a detailed account, so much so that I inquired whether it was based upon a recording. Ms Winter confirmed in her oral evidence that the account was based upon her own notes – I understand a mix of notes and a form of shorthand – and there was certainly no recording. Suffice to say, her note taking was impressive and I accept it. The detail of her account was not challenged and nor did it appear to me to mischaracterise the substance of the exchange.
Mr Romano submitted two emails. One of the emails was dated 30 September 2022 and its purpose appeared to concern his substantive unfair dismissal application. The second email contained an extract of terms from the settlement deed sent to Mr Romano by Ms Winter following the conference on 6 February 2022. The cover email states “Not discussed”, which I have taken to indicate that Mr Romano considered that those sections of the settlement deed that was sent to him were not discussed at the conference on 6 February 2023 and Mr Romano did not consider they were accurate (nor did he have to agree to them).
One particular term Mr Romano appeared to reject was a term stating “they enter into this deed voluntarily and without any duress from any party”. While Mr Romano was directed to file any witness statement he wished to rely upon, he did not do so. Notwithstanding, I gave Mr Romano an opportunity to give sworn oral testimony at the conference on 17 February 2023, although he declined to do so. Mr Romano’s emails were tendered without objection, save for the Respondent making submissions about them.
I have set out above the preliminary matters discussed at the mention hearing on 6 February 2023 immediately before the matter moved into private conference. Returning to Ms Winter’s evidence, it records the following.[1]
“4. After addressing some preliminary matters, Deputy President Bell inquired as to whether the parties would be willing to participate in a private discussion to attempt to resolve the matter. Both parties confirmed that they were willing to participate in such a discussion.
5. As such, at about 11:20 am (AEDT), the matter was adjourned and the parties went into private conference. After each Mr Romano and Mr Harris put forward their respective positions on the unfair dismissal application, the following exchange (or words to this effect) took place:
Deputy President: Mr Romano, are you seeking reinstatement?
Mr Romano Yes
Deputy President: Ms Winter, is the Respondent open to reinstatement?
Me: No.
Mr Romano: If they aren’t going to reinstate, money would bewelcome.
Deputy President: Okay, to kick this off, you can put the first offer on the
table Mr Winter.
Me: We can offer $[offer 1] (gross), less tax, a statement of service that identifies the role, duties, start date and end date, it will be silent on the reasons for leaving, and Mr Harris will be appointed as the contact person and simply confirm that statement of service, and nothing more. Mr Harris will look into Mr Romano’s final pay and communicate it to him directly. If there’s been a mistake, we’ll make an additional payment.
Deputy President: I assume that the terms will also include confidentiality and non-disparagement?
Me: Yes, that’s correct Deputy President.
Deputy President: Do you understand those terms Mr Romano?[Deputy President Bell explained confidentiality and non-disparagement]
Mr Romano: Yes. Is that your final offer?
Me: That’s all I have to offer at this stage. But if you want to put an offer on the table, I can go back to Mr Crosky and put it to him. I’ll need to speak to Mr Crosky though.
Mr Romano: What about $[offer 2]?
Me: Mr Crosky is not going to agree to that.
Mr Romano: What about $[offer 3]?
Me: I’ll need to call Mr Crosky to ask. Deputy President, I might not be able to get a hold of Mr Crosky, but I that’s the case, I can talk to Mr Romano separately.
Deputy President: How about I adjourn for five minutes and let’s see where you get to with Mr Crosky.
6. The private conference temporarily ceased at 11:40 am (AEDT) to allow me to speak to Mr Crosky, who is DP World’s General Manager. At 11:43 am (AEDT), the private conference recommenced and the following exchange (or words to this effect) took place:
Me: We can offer $[offer 4] (gross)… [cut off]
Mr Romano: I’ll accept that. I’ll take it.
Deputy President: Just to confirm the position, it’s $[offer 4] (gross), less tax, a statement of service, Mr Harris is the contact person, mutual confidentiality, and mutual nondisparagement. Okay. My usual practice is to send confirmation of what has been agreed to with the Commission’s standard terms and conditions.
Me: Deputy President, we have a standard deed that we will use. It’s the only deed that our CEO will sign. I’ll send it to Mr Romano.
Deputy President: Well that might mean you have to incur some legal fees. But if you have a template and are ready to use it, then I’m fine with that. Are you sure your CEO has to sign it? That’s quite unusual.
Me: Yes.
Deputy President: When will the payment be made?
Me: Within 14 days of the parties signing the deed.
Deputy President: Can your CEO sign the deed before it’s sent?
Me: No.
Deputy President: Okay. Mr Romano, once you get the deed, don’t sit
on it for five days because, if you do, it will take longer
to get the money.
Mr Romano: Yes. What about the issues with my final pay? Will
that be in the deed?
Deputy President: No, that would be unusual.
Mr Harris: As I’ve said, I’ll look into that as soon as we’re done here today and reach out to you separately.
Me: Mr Harris will look into that separately and I’ll send
you an email
Mr Romano: [nodded his head up and down]
Me: I’ll confirm it when I send you the deed.
Deputy President: Great, well if there’s nothing else the parties want to say, I thank you all for being polite and cooperative – it doesn’t always happen.
Me: Thank you Deputy President. Appreciate your
assistance in this matter.
Mr Romano: Thank you.”
As I indicated above, I am satisfied that Ms Winter’s narrative as just set out is an accurate reflection of the key parts of discussions at the settlement conference. The conference then concluded.
Approximately an hour after the conference, Ms Winter sent Mr Romano an email attaching a settlement deed. The deed was marked “without prejudice” and, including the covering page and signing page, was nine pages in length.
While much of the settlement deed reflected what was discussed at the conference that had just concluded, important aspects of it went well beyond the settlement of Mr Romano’s unfair dismissal claim with DP World Melbourne Limited but included a widely cast net of “Beneficiaries” in the Respondent’s Group. The “Group” was non-exhaustively defined with a list of seven “DP World” entities, including the Respondent, plus all other related bodies corporate of any of those seven entities. As noted above, the deed also contained other terms that were not discussed, including the warranties that Mr Romano stated were “Not discussed” in his email.
Section 399A of the Act relevantly provides:
“399A Dismissing applications
(1) The FWC may, subject to subsection (2), dismiss an application for an order under Division 4 if the FWC is satisfied that the applicant has unreasonably:
....
(c) failed to discontinue the application after a settlement agreement has been concluded.
....
(2) The FWC may exercise its power under subsection (1) on application by the employer.
(3) This section does not limit when the FWC may dismiss an application.”
Section 587 of the Act relevantly provides:
“587 Dismissing applications
(1) Without limiting when the FWC may dismiss an application, the FWC may dismiss an application if:
....
(c) the application has no reasonable prospects of success.
....
(3) The FWC may dismiss an application:
(a) on its own initiative; or
(b) on application.”
The Respondent relies on the principles first stated in Masters v Cameron (1954) 91 CLR 353, 360 (Masters v Cameron). They are well-known and have been applied in numerous courts and tribunals.[2] While those principles are not themselves contentious, the application of them to a particular set of circumstances can be challenging. The following summary of the relevant principles were recently approved by the Victorian Court of Appeal in Sully v Englisch [2022] VSCA 184 (Sully) (a decision to which I will return below), namely:[3]
“In circumstances such as the present, where the parties agreed that they would prepare a written document setting out terms of agreement, the Court may consider the three categories of contract set out by the High Court in Masters v Cameron. These categories describe circumstances in which:
(a) the parties intend to be bound immediately, though expressing a desire
to draw up their agreement in a more formal document at a later stage;
(b) the parties intend to be bound immediately, but may wish the operation
of a particular clause or term to be delayed pending the drawing up of a
more formal document; or
(c) the parties intend to postpone the creation of contractual relations until a formal contract is drawn up and executed.
Since Masters v Cameron was decided, Courts have recognised a fourth category — that being where the parties intend to be bound immediately by terms which they have agreed upon, whilst expecting to make a further contract in substitution for the first contract containing, by consent, additional terms.”
The question of whether the parties intended, by an initial ‘agreement’, to make a binding agreement is to be assessed objectively, based upon “‘what each party by words and conduct would have led a reasonable person in the position of the other party to believe’.” [4]
While it is the overall objective assessment of all the relevant words and conduct that must be considered, there are factors that might tend in one direction or another, depending upon the circumstances, such as:
· An informal oral agreement that was agreed to be later documented may indicate an intention not to be presently bound, although this factor is to be assessed in light of the size, importance and complexity of the subject matter.
· The extent to which matters remain not yet finalised is a matter that might tend against a conclusion to be immediately bound, although if those matters are only “machinery” matters, the conclusion that the parties intended to be immediately bound might be more difficult to resist.[5]
· Where the words ‘offer’ and ‘accept’ are used by the parties, they “are words generally associated with the conclusion of a binding agreement.”[6]
· Caution needs to be exercised in extending a “common practice” in mediations to reducing agreements to written form to dictate a conclusion in particular case that there was no intention to be immediately bound even if written terms were not subsequently executed.[7]
· It has been held that it is permissible to have regard to the conduct and communication of the parties after the agreement has been reached. [8]
· The onus lies upon the party asserting a binding settlement agreement. [9]
As to the question of size, important and complexity as relevant factors, the Court in Sully stated:[10]
“In Geebung Kirby P observed that ‘depending on the size, importance and complexity of the subject matter, the less formal the initial agreement, the less likely it will be that it was intended to be legally binding and enforceable’. I accept that the oral nature of the agreement means it was less formal than a written agreement. However, as Kirby P observed, this factor falls to be assessed in light of the size, importance and complexity of the subject matter. In the present case the quantum of the agreement was small and the settlement terms were uncomplicated. Thus I consider the oral nature of the agreement to be of limited weight.”.
Consideration
The evidence of Ms Winter shows that the parties used the express language of “offer” and “accept” in the negotiations and, in doing so, arrived at an oral agreement in which the Respondent agreed to pay a settlement amount (less applicable taxes) to finalise the proceeding. Also discussed without demur, and I consider that were agreed, was a statement of service and terms for mutual confidentiality and non-disparagement. These are all matters that allow for a complete agreement to resolve the existing litigation and there was no indication any further matter was required. I consider these are factors pointing strongly in favour of a conclusion that there was an immediate, binding agreement on those matters. The agreement was not expressly stated to be “subject to” execution of a written agreement. Specifically, these are matters that I consider pointing to establishment of the first category in Masters v Cameron.
Factors that I considered were tending against a presently binding agreement was the requirement that the parties would sign the Respondent’s “standard deed”. The first point to note is that a deed was contemplated, not simply a contract. The desire for a deed imports a necessary requirement for a written documentation that would need to be signed and witnessed. Second, the deed was to be signed first by Mr Romano and only then by the Respondent. Third, the statement that the Respondent’s CEO would be signing the deed points away from a presently binding agreement. The CEO is usually the most senior person in an organisation and he was not present at the conciliation, which is a factor suggesting that the Respondent did not objectively wish to be bound until he had considered it. Fourth, the “standard terms” were not with the parties at the conciliation and the evidence does not indicate any prior exchange.
The subsequent conduct of the Respondent is also a matter tending against the conclusion that there was a binding agreement. The copy of the settlement deed sent to Mr Romano was marked “without prejudice” and, as described earlier, the terms contained in the deed extended beyond what was discussed at the conciliation.
Notwithstanding the factors pointing against a presently binding agreement, the context in which all the above matters were made are important indicators providing particularly strong support for my conclusion that the parties intended to, and did, enter into a presently binding agreement of the first category in Masters v Cameron.
The first is that the matter was not complex nor were great amounts in dispute. That is not to say that unfair dismissal claims cannot be attended with significant complexity but the basic premise is simple: Mr Romano had been dismissed; he challenged his dismissal as being “unfair” according to the standards of Part 3-2 of the Act; the remedies he was seeking were reinstatement or monetary compensation; the Respondent denied liability.
When presented by me for an opportunity to settle the matter, Mr Romano said that is what he had been “hoping for” and the Respondent was similarly enthusiastic. That is exactly what then occurred. During the settlement conference, an outcome of reinstatement was swiftly taken off the table, after which Mr Romano said that “money would be welcome”. After some back and forth offers, an agreed figure was reached.
In Sully, the Victorian Court of Appeal was considering the settlement of an appeal involving some greater complexity in documentation that was required following an oral settlement agreement reached at mediation. The documents that required drafting were a deed of settlement, a joint memorandum from the parties to the Court about the settlement, an amended notice of appeal, and proposed court orders. That said, as noted by the Court of Appeal, the sum in dispute was “small” (being $6,250) and the settlement terms “uncomplicated”. I consider that the matter before me was broadly commensurate regarding the sum in dispute (at least as finally arrived at by agreement) and the documentation of the matter less complicated.
I am readily satisfied that, assessed objectively, the parties intended to be bound immediately, though expressing a desire to draw up their agreement in a more formal document at a later stage.
I have not overlooked that Mr Romano objects that one of the matters in the deed “Not discussed” was a term where he warranted that the deed was entered into voluntarily and without duress.
Mr Romano was not legally represented. He was correct with his complaint that some matters were “Not discussed”. While the warranty clause described was arguably a “machinery” clause, I would observe that persons unfamiliar with legal documents (and settlement agreements) may not appreciate such matters. I have already observed that the scope of the releases contained in the deed went well beyond what was orally agreed and I do not consider these were necessarily “machinery” provisions by their scope.
While it is perfectly understandable why parties (usually, but not always, respondents) may want to use their own settlement agreement templates following conciliated outcomes before the Commission, I would encourage the parties to keep their agreements as simple as possible and, preferably, to have the actual terms of that template available to the other party during, if not in advance of, the settlement discussions. Otherwise, the risk is heightened that overly complex or unfamiliar provisions might cause a party to reject the written document as not agreed or “not discussed”, particularly where the other party is unrepresented.
At the determinative conference on 17 February 2023, Mr Romano stated “I agreed in principal to that deed” (a further matter supporting confirmation of a binding agreement being reached on 6 February 2023) but he said that when he received the deed, he felt like he was under duress.
I have therefore taken Mr Romano’s objection to the “duress” term described above as a submission that he was in fact subjected to duress or improper pressure, such that any agreement should be set aside. I disagree that this was the case. As noted, both parties approached the opportunity for settlement discussions readily and they each conducted themselves forthrightly and courteously during the conciliation. To the commendation of both parties, they were there to try and settle the matter without further litigation and they did so. There was no duress or improper pressure and no evidence that Mr Romano was subjected to such, although I accept that he no doubt felt the pressure of the moment in trying to resolve a matter that was of real importance to him.
I have also had regard to the Respondent’s reliance on the other email tendered by Mr Romano, where Mr Romano states “Seems like my email was lost” with reference to an email he sent on 30 September 2022. While that email was about events well before Mr Romano’s unfair dismissal claim, the Respondent says it shows that Mr Romano found it only after the settlement conference and (presumably) it fortified Mr Romano to change his mind and press on with his unfair dismissal application rather than sticking to the settlement agreement. Having regard to my conclusions above, it is unnecessary for me to make a finding about this matter, although I do accept that Mr Romano had a change of heart following the agreement on 6 February 2023 and, by 7 February 2023, he wished to continue on with his claim.
Conclusion
For the reasons set out above, the Respondent’s application under s.399A and s.587 of the Act must succeed. Mr Romano’s unfair dismissal application is dismissed and an order[11] will be separately issued.
For avoidance of any doubt, what this now means for Mr Romano is that:
· Mr Romano’s unfair dismissal claim is now finished.
· DP World must pay Mr Romano the final settlement sum, less any applicable tax. He should be paid forthwith and DP World is not entitled to wait another 14 days.
· DP World should also provide Mr Romano with a statement of service as soon as possible.
· Each of the parties must keep the settlement amount confidential.
· Each of the parties must not disparage each other.
DEPUTY PRESIDENT
Appearances:
A Romano on his own behalf
B Milne of Kingston Reid for the Respondent
Hearing details:
2023.
Melbourne (by video link via Microsoft Teams):
February 17.
[1] I have not set out the dollar amounts of the offers, because the final amount is subject to an agreement that it be treated by both parties confidentially. The actual dollar amounts are described in Ms Winter’s witness statement.
[2] As an example of a matter before the Fair Work Commission, the Respondents were relying upon Subeg Singh v Sydney Trains[2017] FWCFB 4562.
[3] Sully v Englisch [2022] VSCA 184 at [62] (footnotes omitted).
[4] Sully v Englisch [2022] VSCA 184 at [62], citing Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165, 179 [40] (Gleeson CJ, Gummow, Hayne, Callinan and Heydon JJ); [2004] HCA 52.
[5] Ibid at [78].
[6] Ibid at [79].
[7] Ibid at [88] – [89].
[8] Ibid at [90].
[9] Ibid at [65], [67] and [102].
[10] At [77] (footnotes omitted).
[11] PR750687
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