Lindsay Cannon v Achmea Schadeverzekeringen N.V
[2021] FWC 458
•4 FEBRUARY 2021
| [2021] FWC 458 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.394—Unfair dismissal
Lindsay Cannon
v
Achmea Schadeverzekeringen N.V.
(U2020/9312)
COMMISSIONER BISSETT | MELBOURNE, 4 FEBRUARY 2021 |
Application for an unfair dismissal remedy.
[1] On 7 July 2021 Mr Lindsay Cannon made an application to the Commission under s.394 of the Fair Work Act 2009 claiming he had been unfairly dismissed from his employment with Achmea Schadeverzekeringen N.V. (Australia Branch) trading as Achmea Australia (Achmea or the Respondent).
[2] The application was referred for conciliation before a staff conciliator on 3 August 2020. As a result of that conciliation the file was marked as settled and then closed by Commission staff.
[3] On 13 November 2020 the Applicant contacted the Commission and requested that his application be referred for arbitration. Because the Commission records indicated that matter had been settled and the file closed, directions were issued to the parties asking why the application should not be dismissed on the grounds that it had no reasonable prospect of success.
[4] Submissions and evidence were filed and the parties indicated that they wished to be heard on the application. A hearing was held before me on 22 January 2021.
[5] Both parties sought to be represented in the hearing and permission was granted.
THE ISSUE
[6] Both parties agree that they reached an agreement in conciliation. What they do not agree on is what those agreed terms were. In particular, there is disagreement as to the information that would be included in the statement of service to be provided to the Applicant. The Applicant’s representative says it was agreed that the statement of service would reflect that the Applicant had resigned. The Respondent says that it was agreed between the parties that the statement of service would confirm the date of appointment and the positions held by the Applicant but would not indicate that the Applicant had resigned.
EVIDENCE
Applicant’s evidence
[7] The Applicant gave no evidence in relation to the conciliation outcome but relies on a letter sent by the staff conciliator sent following the conciliation on 3 August 2020. That letter said, in part:
Dear Applicant and Respondent,
Application for Unfair Dismissal Remedy
Title: Cannon, Lindsay v Achmea Schadeverzekeringen N.V.
Fair Work Commission File Number: U2020/9312
Thank you for your participation in the conciliation in the above matter. I confirm that you reached a settlement agreement and the substantive elements are as follows;
(a) payment of a gross amount of $5,480.76, taxed according to applicable law
(b) acceptance of a resignation, and
(c) provision of a statement of service reflecting the resignation.
(d) reduction of non-compete provisions to a period of 3 months
(e) release provision as discussed
Baker McKenzie (Stephen Hardy), has undertaken to prepare and circulate a draft document reflecting this.
[8] The Applicant also relies on an email from Mr Hardy, representing the Respondent, to the conciliator later that day at 4.44pm in which he asked the conciliator to amend the terms:
Dear [conciliator],
Thank you for your email.
Could I please ask you to amend the list of agreed items as follows (it is important to note that the statement of service will not reflect a resignation. It will be silent on the reason for termination:
(a) payment of a gross amount of $ 5,480.76, taxed according to applicable law
(b) acceptance of a resignation, and
(c) provision of a statement of service reflecting the dates of employment and position held resignation.
(d) reduction of non-compete provisions to a period of 3 months (with the balance of the restraints remaining 6 months)
(e) release provision as discussed
[9] The Applicant also relies on an email sent to the Respondent’s representative (Ms Carmel Foley) on 3 August 2020 at 5.44pm which said:
Dear Carmel
Thank you for your email and your participation in the conciliation earlier today.
It was agreed during the conciliation and as part of the settlement offer that the statement of service would include the dates of employment, position held and resignation. Therefore, the proposed statement of service by the Respondent is not what the Applicant has agreed on.
The Applicant has requested for the statement of service to reflect how the Applicant's employment concluded (i.e. by resignation) as this documentation will be valuable to him when he is seeking future employment opportunities.
Kind regards
Lana Vane
Consultant - Unfair Dismissal Experts Pty Ltd
Respondent’s evidence
[10] The Respondent filed 4 witness statements in these proceedings, 3 signed by Mr Stephen Hardy 1 and 1 signed by Ms Carmel Foley2 both of Baker McKenzie and representing the Respondent. Neither person was required for cross examination. I therefore accept the evidence contained in those statements.
[11] Ms Foley provided evidence of the conciliation proceedings through her notes taken during the conciliation. Those notes indicate the toing and froing in those negotiations: 3
Offer 1 by Applicant |
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Respondent offer 1 |
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Applicant offer 2 |
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Respondent offer 2 |
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Applicant offer 3 |
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[12] Mr Hardy gave evidence as to terms of settlement agreed with the Applicant during the conciliation. These were:
(a) The Respondent pay the Applicant the sum of $5,480.77, less applicable taxation (the Settlement Sum). TheSettlement Sum will be paid into the Applicant's representatives trust account (details of which will be provided to us by the Applicant's representative).
(b) The Respondent will provide the Applicant with a statement of service listing the Applicant's period of employment with our client (start and finish dates) and the position he held, only. The statement of service will be silent as to how the Applicant's employment concluded.
(c) The Respondent will accept a letter of resignation from the Applicant listing the date of resignation as 18 June 2020. The Respondent will place this resignation on the Applicant's personnel file.
(d) The Respondent agrees to the reduction of the non-compete post-employment restriction contained in Schedule A to the Applicant's contract of employment to 3 months (from 6 months). All other post-employment restrictions in Schedule A to the Applicant's contract of employment will continue to apply for 6 months from 18 June 2020.
(e) The Respondent will prepare a Deed of Release. The Deed of Release will contain a release for the benefit of the Respondent releasing it from all claims and liability. The Deed will also contain mutual confidentiality and mutual non-disparagement provisions.
(f) The Applicant agrees to file and serve a Notice of Discontinuance once he has received the Settlement Sum. We expect that this will occur within 3 days of receipt of the Settlement Sum. 4
[13] Mr Hardy said that, following the conciliation, at about 4.27pm on 3 August 2020, he received an email from the conciliator with a letter attached detailing what was said by the conciliator to be the substantive settlement terms reached. That letter indicated, with respect to the statement of service, “provision of a statement of service reflecting the resignation”. 5
[14] At 4.44pm that day Mr Hardy sent an email to the conciliator with a request that the list of agreed terms contained in the correspondence earlier received be amended to reflect the statement of service containing dates of employment and position (with “resignation” deleted) and changes to non-compete provisions. 6
[15] On 4 August 2020 Mr Hardy received an email from the conciliator in which the conciliator indicated that the “statement of service seems to be a big issue” and setting out some “Fair work provisions”. 7 At 9.25am on 4 August 2020 Mr Hardy emailed the conciliator and Ms Lana Yang (representing the Applicant) and indicated to the conciliator that the terms had been agreed and that Mr Hardy had expressly set out the agreed terms at the end of the conciliation. The email also sought that Ms Yang confirm the terms of settlement as set out by the Respondent.8
[16] At 11.16am on 4 August 2020 Mr Hardy received an email from the Applicant’s representative in which it was disputed that the Applicant had agreed that the resignation would not be included in the statement of service. 9
[17] On 10 August 2020 Mr Hardy received a further email from the Applicant’s representative who sought an update on the matter to which Mr Hardy replied that he would forward a deed setting out the agreed terms within the next couple of days. 10
[18] Mr Hardy said he had a telephone conversation with the conciliator on 19 August 2020 in which he said to the conciliator:
My client agreed to treat the dismissal as a resignation but it did not agree to refer to the resignation in the statement of service.
I made that clear during the conciliation and at the conclusion when we were wrapping up. I also emailed you about it following the letter we received at the conclusion of the conference.
The other side seems not to be accepting the agreed terms. Can I please check - what do your notes record? 11
[19] Mr Hardy said the conciliator replied:
I don't have my notes, they have been destroyed
After the conciliation, I sent the standard template letter when a matter settles at conciliation.
If there is a dispute in relation to this matter, I would have to say that I don't recall what was agreed in relation to the statement of service. If I was in the witness box, I would have to say I don't recall. 12
[20] Mr Hardy gave further evidence that on 13 October 2020, on being advised by the conciliator that the Applicant was seeking to re-open his application, he emailed Mr Stephen Gaffney from the Applicant’s representative, Unfair Dismissal Experts (UDE). Ms Yang replied to the email and advised that the Applicant would be willing to accept a statement in the terms proposed by the Respondent if the settlement amount was increased from 3 to 6 weeks. 13 This proposal was rejected by the Respondent who conveyed this to the Applicant’s representative via email on 13 October 2020 at 4.40pm.14 Mr Hardy said that he sent with the email a copy of the deed of release and requested that a signed copy be returned. Despite a follow up to this on 16 November 2020 the Applicant’s representative did not reply.
SUBMISSIONS
Submissions of the Applicant
[21] The Applicant says that in the conciliation he proposed, as his first offer, the payment of 20 weeks’ pay, a statement of service and a resignation. He says that in the Respondent’s second offer and the following discussions were about “financials” and the non-financial terms were not re-visited beyond his opening offer.
[22] The Applicant submits that it is clear from the conduct of the parties that, while they attempted to reach agreement in the conciliation of 3 August 2020, the substantive terms had not been finalised by the parties. In particular the Applicant submits that the Respondent’s actions in quickly responding and disputing the terms provided by the conciliator in his correspondence of 3 August 2020, seeking a change to those terms and the Applicant’s representative rejecting the Respondent’s email is demonstrative that the settlement terms as provided by the conciliator were not those each of the parties considered they had jointly agreed to. This shows that there was no “meeting of the minds” of the parties in conciliation. That each party walked away from the conciliation with a substantively different view as to what had been agreed supports a conclusion that an agreement was not reached.
[23] The Applicant however also submits that agreement was reached between the parties on 3 August 2020 in conciliation but the correspondence immediately following the conciliation demonstrates that each had an opposing view of that agreement.
[24] Given that the parties did not reach agreement on 3 August 2020 and as substantive terms were not finalised the Applicant submits that a binding settlement agreement was not reached.
[25] The Applicant says that since the conciliation the parties have been in “continued correspondence” but have failed to reach a binding settlement agreement.
[26] The Applicant submits that the fact that the parties intended their agreement to be committed to writing in a deed is merely the start of the inquiry as to whether a binding settlement agreement had been reached.
Submissions of the Respondent
[27] The Respondent submits that whether an agreement has been reached by the parties to settle the unfair dismissal matter will depend on the factual circumstances. It submits that the factual circumstances in this case are not dissimilar to those in Australian Postal Corporation v Gorman 15 (Gorman).
[28] The Respondent relies on the decision in Gorman to support its submission that the fact the parties had intended their agreement to be committed to writing in a deed of settlement should be the beginning of the inquiry, not the conclusion. Further, that the parties envisaged some “to-ing and fro-ing” prior to finalising the agreement is relevant but not decisive as to whether an agreement was reached.
[29] The Respondent also relies on the decision of the Full Bench of the Commission in Curtis v Darwin City Council (Curtis). In that matter a draft deed of settlement based on an oral agreement between the parties was drawn up but never executed. On appeal the Full Bench confirmed the existence of a binding settlement agreement and said there was nothing to suggest that what was agreed was not intended to be a contract rather than simply the basis for a future contract.
[30] The Respondent referred to the decision in Rossiter v Miller 16in which Lord Blackburn said that the:
mere fact that the parties have expressly stipulated that there shall afterwards be a formal agreement prepared, embodying the terms, which shall be signed by the parties does not, by itself, show that they continue merely in negotiation. His Lordship proceeded: "... as soon as the fact is established of the final mutual assent of the parties so that those who draw up the formal agreement have not the power to vary the terms already settled, I think the contract is completed. 17
[31] The Respondent submits that in the case of Zoiti-Licastro v Australian Taxation Office 18 the Full Bench confirmed on appeal that, even though the deed contained a mutual release provision beyond those the employee discussed or agreed to, there was still a binding settlement in place.
[32] Taking these decisions into account the Respondent submits that the agreement reached between the parties at the conciliation of 3 August 2020 falls into the first, or alternatively, second class referred to in Masters v Cameron. The Respondent submits that the facts in the decisions in Gorman, Curtis and Zoiti-Licastro deal with similar issues to the matter at hand and it is not appropriate for the Commission to depart from those decisions.
[33] The Respondent submits that there is an accord and satisfaction and all of the essential elements for a binding settlement agreement are present, including:
• Offer
• Acceptance
• Consideration and
• An intent to create a legal relationship.
[34] The Respondent also submits that the parties reached agreement in the conciliation on 3 August 2020 and had no intention to depart from those terms despite an intention to formalise the agreement in a deed of release.
[35] For these reasons the Respondent says the application should be dismissed as it has no reasonable prospects of success.
CONSIDERATION
[36] In this case I am satisfied that an agreement of the first type as described in Masters v Cameron was reached between the parties – that is, the parties reached agreement of finality during the conciliation although proposed that those terms should be reduced to writing.
[37] I have reached this conclusion based on a number of factors.
[38] First, I do not consider the conciliator’s letter determinative of the settlement agreement reached between the parties. Whilst it is highly preferable that the conciliator outcomes letter reflect precisely what was agreed, that it may not is not evidence that agreement was not reached – it is no more than evidence that the conciliator may have misunderstood the terms of the agreement made. That the Applicant says the conciliator’s letter was reflective of the terms of settlement does not take me far. The Applicant’s submissions on this point, balanced against the uncontested evidence of Mr Hardy and Ms Foley which I have accepted, does not persuade me otherwise on this point.
[39] In light of the response from the Respondent to the conciliator on 3 August 2020 that the provisions in relation to the statement of service were wrong, it is unclear to me as to why the conciliator sent an email to the Respondent’s representative (cc’d to the Applicant’s representative) on 4 August 2020 in which he set out what he described as the Commission’s “provisions”. In circumstances where the Respondent said it did not agree to include the resignation in the statement of service the purpose of providing the “provision” – a standard clause where resignation is accepted and then reflected in a statement of service – is not clear and is discordant with the Respondents note to the conciliator.
[40] Secondly, the Applicant has not provided any direct evidence as to what was said in the conciliation. The Applicant is represented by UDE. Ms Yang from UDE was present at the conciliation. Mr Cao of UDE represented the Applicant in the hearing before me. Ms Yang was not present at this hearing and did not provide a witness statement. The Applicant himself was present at conciliation but did not provide any evidence of what occurred. The Applicant relies for its case on the letter from the conciliator, the email from Mr Hardy in reply and an email from Ms Yang as the totality of its evidence as to whether an agreement was reached in the conciliation.
[41] I have balanced this against the direct evidence of Ms Foley who attended the conciliation and who took notes during that conciliation. Ms Foley’s evidence, unchallenged by anyone else present at the conciliation, is that there was an exchange of offers by each party as detailed above at [11]. Her evidence, which I accept, shows that, contrary to the Respondent’s submissions, the non-financial aspects of the settlement were discussed in conciliation after the Applicant’s first offer.
[42] Further, I accept that, at the conclusion of the conciliation, the terms of the settlement were laid out in a joint session by Mr Hardy and that the agreement was:
• 3 weeks @ $1826.92 = $5,480.77 (less tax)
• Reducing non-compete to 3 months
• Resignations and Statement of Service (no mention of resignation)
• Deed – release in favour of Achmea
• Mutual non-disparagement & confidentiality 19
[43] There is no dispute that it was intended that the Respondent would draft the release agreement.
[44] Beyond a submission to the contrary the Applicant did not further seek to challenge the evidence that the final terms were set out in a joint session at the conclusion of the conciliation.
[45] The evidence supports a finding that it was intended that the agreement reached was intended to be reduced to writing but there is nothing in the evidence that would allow me to conclude that the terms had been discussed but no agreement had been reached. This does not allow me to conclude that the outcome of conciliation was not intended to have any binding effect on the parties (such that it might be the third class of agreement identified in Masters v Cameron).
[46] Thirdly, the subsequent correspondence does not detract from a conclusion that an agreement was reached at conciliation.
[47] At 4.27pm on 3 August 2020 after the conciliation had concluded the conciliator sent to the parties a letter in relation to the outcomes of the conciliation. That letter indicated, amongst other things, that the statement of service would include resignation and that there would be a reduction in the non-compete provisions to 3 months.
[48] At 4.44pm Mr Hardy replied to the conciliator correcting both of these items. The conciliator responded at 5.11pm that he would not re-issue the letter but would “forward this email” (presumably to the Applicant).
[49] At 5.44pm that day the Applicant’s representative sent an email to Ms Foley. It is not apparent from the Applicant’s material that this email was in response to any correspondence from the conciliator or Mr Hardy. It appears more likely, and I accept, that it was in response to an email from Ms Foley sent at 5.17pm on 3 August 2020 20 in which Ms Foley set out the 4 items agreed to – the settlement sum, statement of service, non-compete clause and resignation – as well as details of who would draft the settlement agreement and the provision of a notice of discountenance. I therefore do not accept that the correspondence from Ms Yang was in response to the 4.44pm email of Mr Hardy at all. The way in which the Applicant provided its email of 5.44pm does appear, in this respect, to be misleading.
[50] I have further taken into account that there is no dispute from the Applicant that the conciliator got the non-compete provision wrong in his correspondence of 3 August 2020. Accepting that an error was made in this respect suggests that the conciliator may have been in error on the inclusion of resignation in the statement of service.
[51] Fourthly, whilst the Applicant’s representative disputed the terms of settlement as articulated by the Respondent’s representative in its email of 5.17pm that day and this would normally weigh in favour of a finding that agreement was not reached, 21 this focuses on the written documentation post the conciliation when the focus should be on what was agreed (or not) in conciliation.22 Ms Yang has not given evidence in these proceedings which takes me back to the uncontested evidence of Ms Foley and Mr Hardy.
[52] The Applicant’s representative has made submissions that an agreement was reached in the conciliation but that the content of the agreement is not agreed. This submission supports a conclusion that agreement was reached in conciliation.
[53] Finally, I accept, and it was not in dispute, that it was intended that beyond the conciliation the Respondent would prepare the written terms of the agreement. That is agreement was reached in the conciliation and it was agreed to have those terms committed to writing in a form “fuller and more precise but not different in effect.”
CONCLUSION
[54] I have carefully considered the evidence before me and submissions made by both parties. The failure to give evidence weighs against the Applicant and, as I have indicated above, leads me to accept the evidence given for the Respondent.
[55] For the reasons set out above I am satisfied that an agreement was reached between the parties at the conciliation of 3 August 2020. I am further satisfied that it was intended by the parties that there would be a formal agreement prepared but accept that this was not indicative that negotiations were on-going. 23 I accept that the Applicant put a further proposal to settle to the Respondent (through the respective representatives) on 13 October 2020. That this occurred however does not detract from what did occur on 3 August 2020.
[56] I am therefore satisfied that the agreement reached on 3 August 2020 was of the first type identified in Masters v Cameron.
[57] An agreement having been reached “extinguishes the existing cause of action and replaces it with a new cause of action based on the agreement…[it] is not a discretionary factor” relevant to determination of the unfair dismissal application, rather “it is an answer to the claim”. 24 The existence of the agreement “extinguishes” the pre-existing claim and pursuit of the claim is “capable of being considered frivolous or vexations or without reasonable prospect of success.”25
[58] In this case the Applicant has sought to have his unfair dismissal application heard and determined by the Commission.
[59] Having found that an agreement was reached in conciliation on 3 August 2020 to settle the Applicant’s claim I am satisfied that a hearing of the application for relief from unfair dismissal should not occur as the application has no reasonable prospect of success.
[60] Section 587(1)(c) of the FW Act allows the Commission to dismiss an application if it has no reasonable prospect of success. The Commission may do so either on application or on its own motion (s.587(3) of the FW Act).
[61] In the circumstances I am satisfied that the application should be dismissed.
[62] An order 26 to this effect will be issued with this decision.
COMMISSIONER
Appearances:
K. Cho, for the Applicant.
S. Hardy and C Foley, for the Respondent.
Hearing details:
2021.
Melbourne.
22 January.
Printed by authority of the Commonwealth Government Printer
<PR726533>
1 Exhibit R1, R2 and R3.
2 Exhibit R4.
3 Exhibit R4 annexure CBF1.
4 Exhibit R2, paragraph 4.
5 Exhibit R2, annexure SH1.
6 Exhibit R1, annexure SH2. Also set out in the Applicant’s evidence above.
7 Exhibit R2, annexure SH-3
8 Exhibit R2, annexure SH-4
9 Exhibit R2, annexure SH-5.
10 Exhibit R2, annexure SH-7.
11 Exhibit R2, paragraph 7.
12 Ibid.
13 Exhibit R3, paragraphs 5-8 and attachment SH-1.
14 Exhibit R3, annexure SH-2.
15 [2011] FCA 975.
16 (1878) 3 App Cas 1124 cited in Masters v Cameron [1954] HCA 72.
17 Masters v Cameron [1954] HCA 72 at [10]; (1878) 3 App Cas 1124, at pg 1151.
18 (2006) 154 IR 1.
19 Exhibit R4, annexure CBF1.
20 Exhibit R4, attachment CBF4.
21 Zoiti-Licastro v Australian Taxation Office PR967544.
22 Ibid at [12].
23 Masters v Cameron [1954] HCA 72, at [10].
24 Australian Postal Corporation v Gorman [2011] FCA 975 at [31].
25 Ibid at [33].
26 PR726556
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