McKinnon v Eventide Homes (Stawell) Inc.

[2013] FWC 5273

[2013] FWC 5273 Note: An appeal pursuant to s.604 (C2013/5823) was lodged against this decision - refer to Full Bench decision dated 16 October 2013 for result of appeal.

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Jeanette McKinnon
v
Eventide Homes (Stawell) Inc.
(U2013/6757)

COMMISSIONER BISSETT MELBOURNE, 8 AUGUST 2013

Application for relief from unfair dismissal pursuant to s.394 of the Fair Work Act 2009 - application to dismiss - agreement reached in conciliation - complete answer to claim - s. 587(1)(c) no reasonable prospect of success - application for relief from unfair dismissal dismissed.

[1] Jeanette McKinnon (the Applicant) has made an application for relief from unfair dismissal pursuant to s.394 of the Fair Work Act 2009 (the Act). She says she was dismissed from her employment with Eventide Homes (Stawell) Inc (Eventide or the Respondent) on 6 February 2013. A conciliation conference with respect to her application was held by telephone on 14 March 2013.

[2] On 17 July 2013 I made a decision [[2013] FWC 4751] granting the Respondent permission to be represented by a lawyer at the hearing.

[3] At the hearing on 19 July 2013 I determined that the Respondent listed on the application made by the Applicant be amended to Eventide Homes (Stawell) Inc. This is the correct name of the Respondent. The Applicant and the Respondent both agreed to the change.

[4] The Respondent has raised an objection to the unfair dismissal matter being heard. It says that the application is frivolous or vexatious and should be dismissed in accordance with s.587(1)(b) of the Act. It says the Applicant entered into an agreement with the Respondent in settlement of her unfair dismissal application (and other matters).

[5] This decision deals only with those specific matters necessary to dispose of the Respondent’s application:

(i) Was an agreement reached between the Applicant and the Respondent that wholly settled the unfair dismissal application.

(ii) If such an agreement was reached should the application for unfair dismissal be dismissed on the grounds that it is frivolous or vexatious or has no reasonable prospect of success.

[6] This decision does not deal with whether the Applicant’s dismissal was harsh, unjust or unreasonable.

The earlier matters

[7] During these proceedings matters in dispute between the Applicant and Respondent that arose in 2009 and 2010 were raised. These matters are variously referred to as the 2009 matter, the 2009/10 matter or the 2010 matter. For ease I have referred to this as the ‘2010 matter’. Some or all of these matters were subject to a general protections application in accordance with s.372 of the Act (the general protections application). That application was subject to conciliation proceedings in the Commission in 2010 in accordance with the Act. Those proceedings apparently resulted in some agreement being reached between the parties which required the payment of an amount of $7013.07. The Applicant never signed the settlement agreement arising from the conciliation but claims the Respondent still owes her the amount of money arising from that agreement.

[8] In addition, the Applicant also says there is an outstanding 11 days annul leave owed to her relating to time she was required to take off around the time her employment commenced whilst a required police check outcome was provided. It does not appear that this was part of the general protections application.

Evidence

The Respondent

[9] Evidence for the Respondent was given by Ms Sue Blakey, CEO of the Respondent. Ms Blakey was present at the conciliation of the unfair dismissal application. She was also involved in the 2010 matter.

[10] Ms Blakey’s evidence is that also in attendance at the conciliation on 14 March 2013 were David Catanese (the Respondent’s lawyer), Claire Downs (with the Respondent), the Applicant, her husband and Michael Burdess (the Applicant’s lawyer).

[11] Ms Blakey says that the conciliation was with respect to the unfair dismissal claim ‘taking into account the matters from 2009 that were still outstanding.’¹ Ms Blakey says that she wanted all the outstanding legal issues dealt with in the conciliation² and that she had instructed Mr Catanese as to these matters³ which included the 2010 matter and the unfair dismissal application. At the commencement of the conciliation Mr Catanese advised that the Respondent would not participate in the conciliation unless all outstanding legal issues were addressed. She also gave evidence that, on her instructions, Mr Catanese made it clear that reinstatement of the Applicant was not an option.

[12] Ms Blakey says that she considers the agreement reached in conciliation did settle all of these matters.⁴

[13] Ms Blakey agrees that, as the Applicant had not briefed her lawyer on the outstanding legal matters (including at least the 2010 matter), she was given time during conciliation to discuss these issues with her lawyer.⁵ On their return to the conciliation Ms Blakey’s evidence is that Mr Burdess for the Applicant agreed to settle all matters at the conciliation.⁶

[14] Ms Blakey’s evidence is that the basis of the settlement was that the Respondent would pay the applicant eight week’s’ pay with several other settlement terms to be included. She believes that everything included in the terms of settlement was discussed at the conciliation. She agrees that the actual amount of $7610.80 was not read out but that eight weeks’ pay was agreed. Whilst she agrees that the terms in the agreement⁷ at paragraphs 4.2-4.10 were not read out word for word they reflect her understanding of what was discussed during the conciliation.

[15] At the conclusion of the conciliation Mr Catanese requested the conciliator draw up the terms of the agreement. Following the conciliation Ms Blakey says she saw the terms of settlement and instructed Mr Catanese to forward these to the Applicant.

[16] Ms Blakey’s evidence is that she forwarded a cheque to the Applicant for the settlement amount in April 2013. That cheque was presented by the Applicant on 26 April 2013. Ms Blakey does not believe there is anything else the Respondent is required to do pursuant to the agreement reached. In contrast, she says she has not received a resignation letter from the Applicant (which was part of the terms of settlement) or signed settlement terms from the Applicant.

[17] Ms Blakey did not agree to the proposition put in cross examination that the cheque paid to the Applicant in April 2013 was the payment due under the 2010 matter. She further did not agree that it had nothing to do with the unfair dismissal application.⁸ She agrees that the Applicant was seeking reinstatement. However, this was not an option for the Respondent and the conciliation would not have continued unless all outstanding legal matters (including the unfair dismissal matter) were settled. It was on this basis that the conciliation continued.

[18] Ms Blakey’s evidence is that she understood that they had reached a total agreement in the conciliation on all issues including the 2010 matter. 9

[19] Ms Blakey’s evidence is that, were it not for the need to resolve the 2010 matter she would not have offered a financial settlement on the unfair dismissal application alone. 10

The Applicant

[20] The Applicant’s evidence is that the conciliation conference was conducted by telephone, the entire conference was rushed with the commencement of the conference being delayed by problems with the phones, and that it finished quickly as the conciliator indicated he was late for his next meeting.

[21] The Applicant’s evidence is that at the commencement of the conciliation conference Mr Catanese, who appeared for the Respondent, indicated that the Respondent would not continue conciliation unless all outstanding matters between the Applicant and Respondent were settled in the conference.¹¹ The Applicant’s evidence is that her lawyer put forward her proposal for settlement:

...Mr Burdess put to Mr Catanese...the 11 days’ annual leave and the 2009-2010 matter, the fact that Eventide would be prepared to change my termination to a resignation, to give me a certificate of the time I’d worked there sort of thing. When Mr Burdess put to Mr Catanese that - I think there were three, it started off with three, three figures that were discussed toing and froing as to a settlement figure. At that stage Mr Burdess also asked for a reinstatement. He said that’s all Mrs McKinnon is asking for is a reinstatement. I suggested that he ask for a three months’ reinstatement because at that time Eventide or the respondent had indicated that they conceived a problem with me and management but didn’t disclose as to who any problems were with and it came back a flat no to the reinstatement, no to even a trial of three months. Eight weeks’ pay but no figure stated whatsoever as to what that figure was and, yes, I guess that was basically it other than in the beginning, as I said before, Mr Catanese made it clear and stated that if I wasn’t going to go ahead and discuss all the issues, not only the one that my application was for, well, then the respondent was more than happy to go to court ... the thing that struck me most was, first of all, the application that I had to Fair Work Australia I don’t believe was addressed in any way, shape or form, not on the criteria of an unfair dismissal whether it’s harsh, unreasonable or unjust, and I believe that the figure that I was paid was for the 2010, 2009 issue, certainly not anything to do with the application that was before the conciliator at that time... 12

[22] Her lawyer, she says, put alternative propositions but ‘never went back to clarify exactly what the 8 weeks was for’.¹³

[23] The Applicant agrees that an ‘in principle’ agreement was reached in conciliation of the unfair dismissal in March 2013. Arising from this she would be given eight weeks’ pay, her dismissal would be withdrawn and she would be given the opportunity to resign. Her evidence is however that when she received the terms of settlement she was not happy with them.¹⁴

[24] The Applicant’s evidence is that at no time during the conciliation was there any mention of a release being drawn up or signed by her and the Respondent. 15

[25] The Applicant’s evidence with respect to the 2010 matter is that a settlement was reached between her and the Respondent. This involved the return of the Applicant to work and the payment by the Respondent to the Applicant of an amount of $7013.07 (less tax).¹⁶ The Applicant failed to sign the terms of settlement arising from this settlement because she disagreed with some terms in the agreement (in particular the release provision), the dollar amount was never paid by the Respondent although the Applicant did return to work.¹⁷ The Applicant says she was still waiting for the payment of the amount agreed in the 2010 matter.¹⁸

[26] The Applicant agrees that she received a letter from the Respondent in April 2013 headed ‘Jeanette McKinnon v Eventide Homes Inc U2013/6757’. 19 The letter referred to the agreement between the Applicant and the Respondent and enclosed a cheque for $7610.80 (less tax). The Applicant’s evidence is that the letter did not specify if the cheque was for the unfair dismissal application or the 2010 matter. She says she banked the cheque on the basis that it was the payment arising from the 2010 agreement that she had been waiting for.²⁰

[27] The Applicant agrees that the amount owing to her arising from the 2010 matter was $7013.07 (less tax) and the amount she received in April 2013 was for $7610.80 less tax and that these amounts are not the same. 21

Submissions

The Respondent

[28] The Respondent submits that a settlement agreement was reached between the parties in conciliation in March 2013 and that this settlement is a valid accord and satisfaction of all matters between the parties. Ms Berry for the Respondent says that the Applicant was aware that the agreement reached in conciliation was in respect of all matters between the parties.

[29] The Respondent submits that an inference to be drawn that the conciliator was satisfied that a settlement was reached because, at the conclusion of the conciliation the conciliator drew up the terms of the agreement between the parties. The evidence of Ms Blakey indicates that the Applicant’s solicitor agreed to arrange for the Applicant to sign the agreement.²² That the Applicant’s solicitor did not raise any issues of concern with the terms of the agreement allows an inference to be drawn that it did reflect the outcome of the conciliation.

[30] The Respondent’s evidence of the letter sent to the Applicant with the cheque in the settlement amount makes it clear that the cheque was sent arising from the conciliation of the unfair dismissal and that it was in respect of all matters. It says that the letter further supports its contention that the unfair dismissal, the 2010 matter and other outstanding matters were settled in conciliation.

[31] The Respondent submits it has done all it can to comply with the terms of agreement reached between the parties. Additionally, it contends that the cashing of the cheque amounts to part-performance of the agreement.

[32] In accordance with the principles established in Australian Postal Corporation v Gorman 23 (Gorman) the Respondent submits that the agreement is a valid accord and satisfaction of the claim and it extinguishes the pre-existing cause of action. Any pursuit of the original unfair dismissal claim is therefore capable of being found to be frivolous or vexatious.

[33] Whilst agreeing that the agreement document arising from the conciliation was not executed by the parties as it was not signed, the Respondent relies on the authority of Masters v Cameron 24 in support of its submission that a binding agreement can be reached without a document actually being signed. Ms Berry submits that the parties intended to be bound to the performance of the terms of the agreement reached in conciliation and this is evidenced by the fact that the Respondent paid the monetary amount specified in the agreement to the Applicant.

[34] For these reasons the Respondent submits that the application for relief from unfair dismissal should be dismissed in accordance with s.587(1)(b) of the Act on the grounds that it is frivolous or vexatious. The Respondent relies on Zoiti-Lacastro v Australian Taxation Office 25 (Zoiti-Lacastro) where it was held that: ‘Subject to the resolution of any argument about the binding nature of the agreement, the settlement would provide a complete answer to the claim and there would be no point in hearing other evidence.’26

[35] The Respondent also says that, for the same reasons outlined above, and, in the alternative, the application should be dismissed in accordance with s.587(1)(c) because it has no reasonable prospects of success.

The Applicant

[36] The Applicant submits that, although she did not sign the settlement agreement arising from the 2010 matter, there is an outstanding payment due from that settlement. She submits that she was still waiting for the payment from the 2010 matter and that the payment she received in April 2013 from the Respondent was for the amount arising from the 2010 matter. She banked the cheque as the Respondent owed her money from the 2010 matter. She contends that the banking of the cheque cannot be taken to imply that she agreed that all matters arising from the unfair dismissal conciliation had been settled.

[37] The Applicant submits that at the conciliation in respect of her unfair dismissal application she was never given an opportunity to discuss whether her dismissal was harsh, unjust or unreasonable.

[38] The Applicant submits that an agreement could not have been reached during the conciliation of the unfair dismissal application as the terms of such an agreement were never read out and no actual dollar amount was stated.

[39] The Applicant submits that the question to be decided is if what occurred at the conciliation of the unfair dismissal was an agreement in principle or a final agreement. Whilst she says an in principle agreement was reached she submits that no final agreement was made as nothing was signed.

[40] The Applicant submits that no weight can be given to the fact that the terms of settlement arising from the unfair dismissal conciliation were drawn up by the conciliator in deciding if a final agreement was, in fact, reached. The Applicant also submits that, even on the Respondent’s submission, there were amendments made to the terms of settlement after the conciliation ended. This, and the fact that the full terms of settlement were not read out ‘word for word’,²⁷ demonstrate that no final agreement was made during the conciliation itself. She submits that it could only have been a final agreement if all of the terms were known and understood by all of the parties during the conciliation.

[41] The Applicant submits that the agreement reached was not a final agreement. She contends that she has a lawful application before the Commission and that her application is not vexatious or frivolous. She submits that the phone conciliation did not address her application that her dismissal was harsh, unjust or unreasonable and that the conciliation resulted in an in principle agreement and not a final agreement. For these reasons she submits that the application of the Respondent should be dismissed.

[42] The Applicant seeks to distinguish this matter from the circusmtances in Masters v Cameron and Gorman such that she submits they are not applicable to the determination of this application.

Findings

[43] In determining the facts in this matter and to the extent there is a conflict in the evidence between Ms McKinnon and Ms Blakey I favour the evidence of Ms Blakey. Ms Blakey’s evidence is supported by the surrounding non-contentious matters including the drafting and distribution of the written agreement.

[44] Ms McKinnon had difficulty in her evidence accepting clear and unambiguous facts which did not support her case. This is particularly so with respect to the April 2013 cheque. The letter accompanying the cheque clearly states in simple terms that the cheque related to the unfair dismissal application and that it was payment for the settlement of that and all other matters. Despite this Ms McKinnon continues to assert that it was payment only in respect of the 2010 matter. The obfuscation by the Applicant on this matter brings to question the credibility of her testimony to the extent that, where it is contradicted, I prefer the evidence of Ms Blakey.

Was an agreement reached between the Applicant and the Respondent in conciliation?

[45] In Masters v Cameron the High Court held that when parties reach agreement on terms of a contractual nature and agree that the negotiations will be dealt with by a formal contract, that the case may belong to any of three categories:

(1) the parties have agreed on all terms and intend to be immediately bound to perform 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”; or

(2) the parties have agreed on all terms and intend no departure from or addition to that which there agreed terms express or implied, “but nevertheless have made performance of one or more of the terms conditional upon the execution of a formal document”; or

(3) the parties do not intend “to make a concluded bargain at all, unless and until they execute a formal contract.” 28

[46] In the first two categories the High Court held that there was a binding contract.

[47] The principles in Masters v Cameron provides clear guidance as to the status of any agreement reached in conciliation and are applicable in determining this matter. Ms McKinnon suggests the decision can be ignored. To ignore established legal authority is not appropriate and would lead to uncertainty in decision making by the Commission. There are well established public policy reasons relating to sound administration and consistency in decision making that determine the applicability of the reasoning in Masters v Cameron and in other relevant decisions of the Courts and this Commission to this matter.

[48] The question of whether or not there was a binding agreement reached between the parties is a matter of fact. 29 Even though the Applicant did not sign the agreement arising from conciliation this does not mean that a binding agreement was not reached. The question to be determined is if any agreement of the types described in Masters v Cameron was reached between the parties in conciliation. If the agreement reached is of the first or second category it would, following Masters v Cameron, be a binding agreement.

[49] I am satisfied that an agreement was reached in conciliation and that the agreement reached falls into the first category described in Masters v Cameron. Ms Blakey says an agreement was reached. The Applicant says an agreement was reached but says it was an agreement in principle only and that this is evidenced by the terms of the agreement not being read out. In either scenario it is clear agreement was reached.

[50] That the precise terms of the agreement were not read out during the conciliation conference or that it was not ultimately signed does not mean an agreement was not reached. I am satisfied that the terms were agreed, that the parties intended to be bound by those terms and that the parties intended that those terms be formalised in a form ‘more precise but not different in effect’ to those discussed.

[51] In Zoiti-Licastro it was argued that there were terms included in the final agreement that had not been specifically dealt with in the conciliation discussion.

[52] The relevant facts in Zoiti-Licastro are set out in paragraph 4 of that decision:

The evidence concerning the settlement discussions is set out in the Senior Deputy President’s decision. It is not necessary to repeat it all. It is clear that following discussions on 3 March 2005 between Mr Dowling on behalf of the appellant and Mr Niall on behalf of the ATO agreement was reached on the following terms:

(i) the ATO would pay the appellant $17,000 ($12,000 on the presentation of invoices for legal costs and $5,000 as an eligible termination payment);

(ii) a statement of service would be provided to the appellant;

(iii) payment would occur within 14 days of signing terms of settlement;

(iv) the appellant would adjourn the proceedings pending receipt of payment. 30

[53] Whilst finding that the terms included in the written agreement that were not discussed went to mutual releases and confidentiality, the Full Bench found that:

It is clear that the settlement agreement drafted by the ATO’s solicitors contained mutual releases and those had not been specifically agreed in the discussions on 3 March. There were other terms included as well, such as a request for confidentiality. But the appellant’s focus on the settlement document seems to us to miss the point. The real question is what was agreed on 3 March between counsel. It is clear enough that a completed agreement was reached and that it was not conditional in any sense on an agreement being signed. Terms relating to mutual releases and confidentiality could hardly be said to be unusual. Even so, if they were objected to the proper course would be for the appellant to simply indicate that they were not part of the agreement. No such indication was given, at least not until after 31 March 2005. 31

[54] The circumstances in this case are not substantially different to those of Zoiti-Licastro. On the basis of the principles in Zoiti-Licastro it can be concluded that the failure to read out, during conciliation, the precise wording of the terms of the agreement reached between the parties does not mean that a concluded agreement was not reached. Concentration on the words of the agreement ‘miss the point.’ On the evidence before me nothing was said in conciliation of this application that suggests the agreement was conditional in any sense.

[55] My conclusion that an agreement was reached in conciliation is further supported both by the drafting of a document titled ‘Terms of Settlement’ by the conciliator and by Mr Burdess, on 15 March 2013, confirming receipt of agreement document and advising Mr Catanese that he would make arrangements for the Applicant to sign it. Both of these events lend substantial weight to the conclusion I have reached that a concluded agreement was made.

[56] Even if, as the Applicant says, the agreement was one in principle as opposed to a final agreement there is no evidence as to what other matters were to be resolved or were to be subject to further negotiation before the agreement would be considered final. Whilst I acknowledge that the Applicant wanted her job back I accept the evidence of Ms Blakey that this was rejected as an option early in the conciliation and the discussion then turned to the terms of settlement finally agreed.

[57] I am satisfied on the basis of the evidence of Ms Blakey and the Applicant that it was discussed and agreed in the conciliation that the payment to be made to the Applicant would be eight weeks’ pay. It was also discussed and agreed that the Applicant would be given an opportunity to resign, and the Applicant would receive a statement of service. That the exact amount to be paid was not specified does not detract from my finding that an agreement was reached.

[58] The Applicant also suggests that the question of whether her dismissal was harsh, unjust or unreasonable was never discussed. Whilst she does not explicitly say so, I infer that this is another reason she says the agreement was in principle and not final. If this is the case the Applicant misunderstands the purpose of the conciliation. The conciliation is not to determine if the dismissal of the Applicant was harsh, unjust or unreasonable (such a finding could only be made after a hearing of the application) but rather to explore if there is a possibility of a mutually satisfactory settlement to the matters between the parties without having to go to a formal hearing. It was not necessary that the conciliator determine if the dismissal was harsh, unjust or unreasonable and it certainly was not necessary in the context of reaching an agreement to settle the claim between the parties.

[59] There is, therefore, no evidence on which I could conclude that the parties did not intend to be bound by the agreement in conciliation.

[60] I am satisfied, on the basis of the evidence of both Ms McKinnon and Ms Blakey that the conciliation conference in relation to the application for unfair dismissal proceeded on the basis that it would deal with all outstanding claims of Ms McKinnon against the Respondent. I find, on the basis of the evidence of Ms Blakey that the Applicant’s solicitor agreed that this would be the basis on which proceedings continued. Further, I find that the outstanding issues between Ms McKinnon and the Respondent were at least the 2010 matter and the unfair dismissal application.

[61] This conclusion is supported by the terms of the agreement drafted. Clause 1 of the agreement refers to the unfair dismissal application. Clause 2 refers to the general protections application. Clause 4.6 of the agreement provides that the Applicant will discontinue both the unfair dismissal and the general protections applications as part of the agreement.

[62] The Respondent has paid the amount agreed in conciliation (eight weeks’ pay) and specified in the agreement to the Applicant by cheque on 11 April 2013. The letter accompanying the cheque is clear:

Ms Jeanette McKinnon

...

Jeanette McKinnon -v- Eventide Homes (Stawell) Inc (FWC ref. U2013/6757)

We refer to the agreement made to resolve all matters between you and Eventide Homes (Stawell) Inc, including the above proceedings, at the conciliation conference on 14 March 2013.

Please find enclosed a cheque for $6354.80 being $7,610.80 less tax, in accordance with the above agreement.

(emphasis in italics added)

[63] It is disingenuous of the Applicant to suggest, given the contents of the letter accompanying the cheque, that the payment was in relation to the settlement of the 2010 matter. She received this cheque about four weeks after the conciliation proceedings which she agrees in evidence dealt with all outstanding claims. The letter accompanying the cheque is clear. On what basis the Applicant could conclude that the cheque related solely to matters dealt with three years earlier is incomprehensible.

[64] In this case I am satisfied that the parties reached an agreement in the conciliation conference on 14 March 2013. I am satisfied that the parties agreed on the terms of the agreement even though they may not have been read out word for word in the conciliation. I am satisfied that the parties intended to be immediately bound by the terms of the agreement and intended to reduce the terms of that agreement to writing. That is, in exchange for the payment of an amount the Applicant would abandon her claim to unfair dismissal and other outstanding matters.

[65] I am satisfied that the agreement falls within the first category identified in Masters v Cameron such that there is a binding agreement between Ms McKinnon and the Respondent.

Is the application frivolous, vexatious or have no reasonable prospects of success?

[66] In Gorman Besanko J of the Federal Court said:

The applicant’s case is that there was an accord and satisfaction between it and the first respondent. It is not suggested that the agreement constituted an accord executory (McDermott v Black [1940] HCA 4; (1940) 63 CLR 161 at 184 per Dixon J (as his Honour then was)). It would not matter if the accord and satisfaction was conditional as the applicant is prepared to carry out its obligations under the agreement (Seddon N and Ellinghaus M, Cheshire and Fifoot’s Law of Contract (8th Australian ed, LexisNexis Butterworths, 2002) [4.24]).

An accord and satisfaction extinguishes the existing cause of action and replaces it with a new cause of action based on the agreement. A valid accord and satisfaction is not a discretionary factor relevant to the subsequent litigation of the original claim; it is an answer to the claim.

...

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. 32

[67] Section 587 of the Act states:

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.

[68] The Respondent does not rely on s.587(1)(a) but rather on s.587(1)(b) and (c).

[69] The Respondent relies on the reasoning in Gorman in support of its application for dismissal of the original application.

[70] In Gorman it is clear that an agreement, such as the one I have found was reached by the parties in this matter, is not a ‘discretionary factor’ to be considered in the litigation of a case but rather it is a complete answer to the claim. Continued pursuit of the claim is therefore useless as the basis of the claim no longer exists – that is, the claim has been satisfied and dispensed with by virtue of the agreement.

[71] In Gorman it was said that pursuit of the claim by the Applicant may well be vexatious. I do not make such a finding in this case. Such a finding may well be open to the Commission if the Applicant sought to re-litigate her application for unfair dismissal. A finding that an application is vexatious goes to the motive or intention 33 in instituting proceedings. The matter I am now considering (that is, the reaching of an agreement) occurred after the application for relief from unfair dismissal was made. It is the continued pursuit of the claim and not the original making of it, which is subject to complaint of the Respondent. A finding that the application was vexatious is not open on the basis of the original unfair dismissal application made by the Applicant. There is no reason to find that the original application was made with improper motive.

[72] It is possible however to conclude that the application, at this stage of proceedings and having found the existence of an agreement between the parties, has no reasonable prospect of success. This is so precisely for the reasons given in Gorman. The agreement answers the claim. There is no longer a claim to be pursued. It has no reasonable prospect of success. While such a conclusion should only be drawn where an application is ‘manifestly untenable or groundless’ 34 it is reasonable, in my opinion, in circumstances where an agreement in settlement of an application has been reached.

[73] I therefore find that the application should be dismissed on the grounds that it has n reasonable prospect of success.

[74] In its correspondence to the Commission on 1 May 2013, the Respondent also relies on s.399A(1)(c) to ground its application for dismissal of the application.

[75] Section 399A of the Act states:

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:

(a) failed to attend a conference conducted by the FWC, or a hearing held by the FWC, in relation to the application; or

(b) failed to comply with a direction or order of the FWC relating to the application; or

(c) failed to discontinue the application after a settlement agreement has been concluded.

Note 1: For another power of the FWC to dismiss applications for orders under Division 4, see section 587.

Note 2: The FWC may make an order for costs if the applicant’s failure causes the other party to the matter to incur costs (see section 400A).

(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.

[76] Section 399A was inserted into the Act by virtue of the Fair Work Amendment Act 2012 and came into operation on 1 January 2013.

[77] The Explanatory Memorandum to the Fair Work Bill 2012 makes it clear that s.399A does not limit the Commission’s power to dismiss an application under s.587 because the application is vexatious or frivolous or has no reasonable prospect of success 35 but rather provides an additional power where there is an unreasonable act or omission of the Applicant. Having reached a concluded view pursuant to s.587 there is no need to consider the application for discontinuance under s.399A.

Conclusion

[78] In all of the circumstances and based on my findings above I dismiss the application of Ms McKinnon on the grounds that it has no reasonable prospect of success. An order to this effect will be issued in conjunction with this decision.

COMMISSIONER

Appearances:

J. McKinnon on her own behalf.

C. Berry for the Respondent.

Hearing details:

2013.

Ballarat;

19 July.

Final written submissions:

Applicant, 25 July 2013.

1 Transcript PN94.

2 Transcript PN122-4.

3 Transcript PN121.

4 Transcript PN132.

5 Transcript PN165.

6 Transcript PN96 and 208.

7 Exhibit E1, annexure 1.

8 Transcript PN194.

 9   Transcript PN112.

 10   Transcript PN192-93.

11 Transcript PN237.

 12   Transcript PN237.

13 Exhibit A1, paragraph 14.

14 Transcript PN261.

 15   Exhibit A1, paragraph 16.

16 Transcript PN245.

17 Transcript PN250-1.

18 Transcript PN253.

 19   Exhibit E1, annexure 6.

20 Transcript PN267.

 21   Transcript PN274-276.

22 Exhibit E1, annexure 2.

 23 [2011] FCA 975 [37].

 24 (1954) 91 CLR 353.

 25 (2006) 154 IR 1.

 26 (2006) 154 IR 1 [20]

27 Transcript PN327.

 28 (1954) 91 CLR 353, 360.

 29   Australian Postal Corporation v Gorman [2011] FCA 975 [37].

 30 (2006) 154 IR 1, [4].

 31 (2006) 154 IR 1, [12].

 32 [2011] FCA 975, [30].

 33   Textile Clothing and Footwear Union of Australia v Givoni Pty Ltd [2011] FCA 1406.

 34   Deane v Paper Australia Pty Ltd, PR 932454, 6 June 2003.

 35   Paragraph 166.

Printed by authority of the Commonwealth Government Printer

<Price code C, PR539666>