Elizabeth Baron v STA Travel Pty Ltd T/A STA Travel

[2016] FWC 6724

[2016] FWC 6724

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394 - Application for unfair dismissal remedy

Elizabeth Baron
v
STA Travel Pty Ltd T/A STA Travel
(U2016/2289)

COMMISSIONER WILSON MELBOURNE, 19 SEPTEMBER 2016

Application for relief from unfair dismissal - matter settled - application dismissed pursuant to s.587 of the Act.

[1] On 29 August 2016, a Decision ([2016] FWC 6001) dismissing the Respondent’s application made pursuant to s.399A of the Fair Work Act 2009 (the Act) was issued. That Decision detailed the apparent in-principle settlement agreement that had been reached between the parties, and requested confirmation from the parties within seven days of the date of the Decision to advise whether the terms of settlement had been implemented.

[2] Neither party has corresponded with the Commission subsequent to the issuing of that Decision.

[3] The file records correspondence between the parties in relation to settlement of the dispute over the period of around 14 July 2016 to 25 July 2016. That interchange culminates in a conditional acceptance by Ms Baron of an offer of settlement, and a subsequent Deed of Release provided by the Respondent’s solicitors to the Applicant reflecting the agreed terms.

[4] The file also records a withdrawal of the offer of settlement by the Respondent on 8 August 2016, apparently due to the failure by Ms Baron to execute the deed.

[5] In the matter of Curtis v Darwin City Council, 1 the Full Bench held that there were three circumstances in which issues of contract may well impinge on the future progression of an apparently settled matter, with it being found;

“[61] At first instance the respondent submitted that the agreement fell into either class 2 or, in the alternative class 1 as identified in Masters v Cameron. In that case the High Court held that where parties who have been in negotiation reach agreement upon terms of a contractual nature and also agree that the matter of their negotiation shall be deal with by a formal contract, the case may belong to any of three classes. The three classes are:

1. The parties have reached finality in arranging all the terms of their bargain and intend to be immediately bound to the performance of those terms, but at the same time propose to have the terms restated in a form which will be fuller or more precise but not different in effect.

2. It may be a case in which the parties have completely agreed upon all the terms of their bargain and intend no departure from or addition to that which their agreed terms express or imply, but nevertheless have made performance of one or more of the terms conditional upon the execution of a formal document.

3. The case may be one in which the intention of the parties is not to make a concluded bargain at all, unless and until they execute a formal contract.

[62] In each of the first two cases there is a binding contract: in the first case a contract binding the parties at once to perform the agreed terms whether the contemplated formal document comes into existence or not, and to join (if they have so agreed) in settling and executing the formal document; and in the second case a contract binding the parties to join in bringing the formal contract into existence and then to carry it into execution.

[63] Cases of the third class are fundamentally different. They are cases in which the terms of agreement are not intended to have, and therefore do not have any, any binding effect of their own. The expressions ‘subject to contract’, ‘subject to the preparation of a formal contract’ and others of similar import prima facie create an overriding condition so that what has been agreed upon must be regarded as the intended basis for a future contract and not as constituting a contract of itself.”

[6] A finding can be made that the circumstance of this matter falls into the second of the classes referred to in Curtis. The parties reached agreement on the substantial matters with the intention of drafting and executing a formal document.

[7] Having regard to the material before me, I find that there is, in existence, a binding agreement to settle the Applicant’s application.

[8] Section 587(1) of the Act provides as follows;

587 Dismissing applications

(1) Without limiting when the FWC may dismiss an application, the FWC may dismiss an application if:

(a) the application is not made in accordance with this Act; or

(b) the application is frivolous or vexatious; or

(c) the application has no reasonable prospects of success.

[9] In Australia Postal Corporation v Gorman, 2 Besanko J held that the existence of a binding settlement or “accord and satisfaction” extinguishes the existing cause of action and replaces it with a new cause of action based on the agreement.3

[10] His Honour stated;

“33 There is nothing in the Act which suggests that an accord and satisfaction should not be recognised. At a general level the object of Chapter 3 Part 3-2 and the general statements of the manner in which FWA is to perform its functions and the matters to which it is to have regard are consistent with the recognition of an accord and satisfaction. Furthermore, the words of subsection 587(1) are wide enough to include the recognition of an accord and satisfaction. As I have said, a valid and effective accord and satisfaction extinguishes the pre-existing cause of action and continued pursuit of an application based on such cause of action is clearly capable of being considered to be frivolous or vexatious or without reasonable prospects of success.” 4

[11] I am satisfied that in the circumstances where there is a binding agreement between the parties, I should exercise my power under s.587(1)(c) of the Act to dismiss Ms Baron’s application. An order to this effect will be issued in conjunction with this decision.

COMMISSIONER

 1   [2012] FWAFB 8021 [61]–[63], with reference to Masters v Cameron [1954] 91 CLR 353, 360-361, per Dixon CJ, McTiernan and Kitto JJ.

 2 [2011] FCA 975.

 3 Ibid [31].

 4 Ibid [33].

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