Megan Bell v Singaria (Aust) Pty Ltd T/A Crown on McCredie
[2020] FWC 1181
•4 MARCH 2020
| [2020] FWC 1181 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.394—Unfair dismissal
Megan Bell
v
Singaria (Aust) Pty Ltd T/A Crown on McCredie
(U2017/11795)
COMMISSIONER JOHNS | SYDNEY, 4 MARCH 2020 |
Application for an unfair dismissal remedy – agreement to settle the matter – no reasonable prospects of success – application dismissed.
[1] This decision is about whether I should dismiss Megan Bell’s (Applicant) unfair dismissal claim (UFD Application) against her former employer Singaria (Aust) Pty Ltd T/A Crown on McCredie (Respondent) because, as the Respondent contends, the Applicant has no reasonable prospects of success by reason of the parties having reached a concluded agreement on 23 November 2017.
Background
[2] On 5 November 2017, Ms Bell made an application to the Fair Work Commission (Commission) under s.394 of the Fair Work Act 2009 (Cth) (the FW Act). She claimed she had been unfairly dismissed from her employment as a Manager which had commenced in September 2012.
[3] On 21 November 2017 the Respondent filed a response. It denied that the Applicant was unfairly dismissed. The Respondent asserted that it had terminated the Applicant’s employment for serious misconduct, specifically for swearing at a group of patrons that included children. In her UFD Application the Applicant denied engaging in any such conduct.
[4] However, the factual contest between the Applicant and the Respondent has never been tested.
[5] This is because, on 23 November 2017 the Commission conducted a conciliation conference and (at least up until October 2018) it was thought that the dispute had been resolved. The Commission closed its file.
The conciliation conference and events of 2018
[6] At the conciliation conference on 23 November 2017 (which was conducted by telephone):
a) the Applicant represented herself, accompanied by her support person.
b) he Respondent was represented by Mr Kent Walker, director of the Respondent, Mr Anthony Bensley, Licensee of the Respondent and Mr Sean D’Almada-Remedios of the Australian Hotels Association New South Wales.
[7] At 16.02 on 23 November 2017 the Commission’s conciliator “resulted” the matter as follows:
• Description: settled, monetary + non-monetary
• Initiating event: Result – settled: monetary + non-monetary
• Applicant consent: Yes
• Monetary value: $2000 - $3999
• Non-monetary: Resignation, Statement of Service, Provision of information or undertaking.
[8] It was also noted that cooling off period had been waived.
[9] At around 16.44 on 23 November 2017 the Commission’s Conciliator wrote to the parties in the following terms:
“Thank you for your participation in today’s conciliation in the above matter. I confirm that you reached a settlement agreement and I attach terms of settlement.
I confirm that the parties have agreed to waive the cooling off period that applied to this agreement.
As this is an agreement reached between the parties, you must send your signed terms to the other party. Do not send a copy to the Fair Work Commission (the Commission) as we do not keep any record of your agreement. You should however keep a signed copy of the agreement for your records. The statement of service should be sent directly to the relevant party, not to the Commission.
The Applicant will need to file a Form F50 “Notice of Discontinuance” (see …) with the Commission, with a copy sent to the Respondent. The Commission will refund the application fee, if applicable, within four to six weeks of receipt of the Form F50.”
[10] At around 16.09 on 4 December 2017 the Applicant called the Commission asking how to discontinue her matter. She indicated that the Respondent had not yet complied with all the terms of the settlement agreement. The Applicant did not file a Notice of Discontinuance.
[11] On 7 December 2017 the Commission archived its file.
[12] On 3 October 2018 the Applicant inquired about reopening her matter. In an email on 4 October 2018 the Applicant noted that she “did not sign off any paperwork after the mediation phone call.”
[13] On 17 October 2018 the Applicant advised Deputy President Dean the she “has decided not to proceed with a hearing to determine if settlement was reached.” The Commission again archived its file.
The November 2019 application to reopen the UFD Application
[14] On 24 November 2019 the Applicant sent an email to the Commission again asking to re-open the UFD Application
[15] On 28 November 2019 Commission wrote to the Applicant in the following terms (omitting formal and irrelevant matters):
“Vice President Catanzariti has received your email below. It appears you are requesting to re-open the Fair Work Commission’s (the Commission’s) file for the unfair dismissal application you lodged on 5 November 2017 (matter no. U2017/11795).
From the Commission’s record of your matter, it appears that the parties reached a settlement agreement before a staff conciliator on 23 November 2017, the terms of which the respondent was to send to you. The staff conciliator confirmed this in a letter to you and the respondent that same day. The letter relevantly stated:
… I confirm that you reached a settlement agreement and I attach terms of settlement.
I confirm that the parties have agreed to waive the cooling off period that applied to this agreement.
The Vice President is of the view that in light of this, a cause of action for unfair dismissal may no longer exist. Under normal circumstances, it is then open to the parties to enforce the terms of settlement in another jurisdiction. A settlement agreement does not always need to be in writing, nor signed, to be enforceable.
If you press your request to re-open the Commission’s file now, please provide further reasons in support of that by 4:00 pm on Thursday, 5 December 2019.
The Vice President also notes that you made a similar request to re-open the Commission’s file on 3 October 2018, with which you then decided not to proceed. If something has changed between then and now, please provide further information about that in particular.”
[16] On 5 December 2019 the Applicant responded as follows (omitting formal and irrelevant matters):
“I would like to press to re-open my unfair dismissal case.
As you mentioned, I did try to begin this process in 2018 leading up to the anniversary of my dismissal. Nothing has changed since this time, however that is the problem. As noted in my last email, there has been a significant ongoing emotional impact, and I am still a mess as a result of the dismissal. Being accused of doing something that you did not do is hard enough, let alone having your entire life destroyed because of it.
In addition to the emotional impact and the fact I did not sign anything, I would like to refer back to the reasons mentioned in my email in October 2018. That is, a number of other terms of settlement were not adhered to.
Since neither party signed and not all terms were agreed to, I do not think the matter is settled. One of the terms was the hotel sending me a statement of service (outlining my period of service, position and duties). This was never provided to me. As well as this meaning they did not comply with the terms of settlement, this would have hindered me from finding a new job (if I had been in an emotional position to do so, which I still am not). It took repeated messages and calls and then finally a call from Centerlink to even get my separation certificate.
Another term was to not denigrate or disparage each other, which I also feel was not adhered to. False details of the mediation were given to another staff member, who was told I "threw her under the bus" during mediation. This was not true, as I had not even mentioned her name. This attempt to cause conflict and cast me in a negative light does not fit with "not denigrating or disparaging" me.
I even had several customers, one of whom does not even live in the area anymore, call me who had knowledge of the details of the mediation.
Lastly, I would like to say in writing that I did not have the emotional capacity to understand the mediation versus court process. I thought the purpose of mediation was for me to state my case (regarding the fact I did not act in the manner I was accused of) and to get some answers. I did not understand that I needed to go to court in order to get answers or to have the dismissal properly investigated.
I am not trying to re-open the case for financial gain, as it is not about the money. Rather, I am still seeking the answers and closure I had hoped to receive from my concept of what I believed mediation to be.
Hopefully by doing this I can get some closure.”
[17] On 6 December 2019 the matter was allocated to me. On 9 December 2019 I listed the matter for a mention/directions hearing.
[18] On 11 December 2019 I programmed the matter for hearing on 30 January 2020.
[19] On 12 December 2019 I wrote to the Applicant in the following terms (omitting formal and irrelevant matters):
“The Commissioner said he would provide you with information about settlement agreements.
When an employee seeks to pursue an application:
• after an executed settlement agreement has been reached between the parties, and
• the settlement has been paid;
the application can be dismissed for being frivolous or vexatious or for having no reasonable prospect of success.
An executed settlement agreement is an agreement where all of the specific terms and requirements have been met. When is a binding agreement made?
A key issue is whether the parties intended to be bound by a verbal agreement or whether the parties intended for the agreement to be put into writing and signed.
The question of whether there is a binding agreement or not depends upon the intention disclosed by the language the parties have used.
The parties may agree that a negotiated agreement will only be binding once it is seen in its final written form and signed, whether this was the parties intention will depend on the true construction of the evidence.
A binding settlement agreement can still be found to exist even if some aspects of the agreement were not finalised at the time.
Below are links to relevant decisions. You will need to address these cases in your submissions.
• Banister v Queensland Rail Limited [2012] FWA 3973 (Asbury C, 9 May 2012) at paras 25–26; citing Australian Postal Corporation v Gorman [2011] FCA 975 (25 August 2011) at paras 31‒33; and Butler v Fairclough [1917] HCA 9 (29 March 1917), [(1917) 23 CLR 78].
• Masters v Cameron [1954] HCA 72 (30 November 1954), [(1954) 91 CLR 353, at pp. 360‒362]; see for eg Badcock v N & HM Cooper Motor Search (SA) & Car Clearance Centre (SA) T/A Motor Search [2018] FWC 6978 (Hampton C, 26 November 2018).
• Zoiti-Licastro v Australian Taxation Office [2006] AIRC 45 (Kaufman SDP, 25 January 2006) at para. 12, [(2006) 154 IR 1].
Click below link for information on hearings at the Fair Work Commission and links to certain template documents to help you prepare:
…
The Respondent is copied into this email. Please ensure to include the Respondent into all correspondence with Chambers.”
[20] On 8 January 2020 the Respondent completed a Form F1 application seeking an order pursuant to s.587(1)(c) of the FW Act that the UFD Application be dismissed. The Respondent also filed an Outline of Submissions (Exhibit 6) and a supporting Statement from Anthony Bensley, the Respondent’s Licensee (Exhibit 7).
[21] On 22 January 2020 the Applicant filed submissions in support of the re-opening of her UFD Application (Exhibit 8) and a Statement (Exhibit 9).
[22] On 29 January 2020 the Respondent filed submissions in reply (Exhibit 10) and an Affidavit from Sean D’Almada-Remedios, Advisor in the Legal and Industrial Affairs Department of the Australian Hotels Association (NSW) (Exhibit 11).
Hearing
[23] At the hearing on 30 January 2020:
a) the Applicant represented herself, accompanied by her support person.
b) the Respondent was represented by Mr Martin Dunne of AHA NSW. The Respondent’s witnesses and Mr Kent Walker, a Director of the Respondent, also attended.
c) the Applicant cross-examined Anthony Bensley.
[24] At the commencement of the hearing I confirmed receipt of the documents which had been filed and marked each document as an exhibit as follows:
Exhibit Number | Title | Transcript Reference |
1 | FWC letter confirming settlement and attaching terms of settlement dated 23 November 2017 | PN21 |
2 | Applicant’s email to FWC requesting that the matter be reopened dated 24 November 2019 | PN21 |
3 | Email from chambers of Catanzariti VP requesting the Applicant provide further submissions dated 28 November 2019 | PN21 |
4 | Applicant’s further submissions to chambers of Catanzariti VP filed 5 December 2019 | PN21 |
5 | Form F1 – Application to dismiss pursuant to s.587 dated 8 January 2020 | PN21 |
6 | Respondent’s outline of submissions dated 8 January 2020 | PN21 |
7 | Statement of Anthony Bensley dated 8 January 2020 | PN21 |
8 | Applicant’s submissions filed 22 January 2020 | PN32 |
9 | Statement of Megan Bell filed 22 January 2020 | PN32 |
10 | Respondent’s submissions in reply dated 29 January 2020 | PN34 |
11 | Affidavit of Sean D’Almada-Remedios filed 29 January 2020 | PN34 |
[25] In coming to this decision I have had regard to all of the material filed in the proceeding and the evidence received and submissions made on 30 January 2020.
Evidence
[26] Mr Bensley gave the following evidence:
“…
1. I am employed by the Respondent as the Licensee of the Crown on McCredie Hotel (the Hotel) and have been employed in this role since 21 March 2011.
2. My responsibilities in this role include the management of staffing and human resources of the business.
3. The Applicant was employed at the Hotel from on or around September 2012 to 18 October 2017.
4. On 18 October 2017, I terminated the Applicant's employment after forming the view that she engaged in serious misconduct in the course of her employment.
5. On 8 November 2017, I received an email from the Fair Work Commission with notification of the Applicant's unfair dismissal application, including the application and a notice of listing for a conciliation conference which was to be held by telephone on 23 November 2017 at 2:15 pm.
6. On 23 November 2017, I attended this conference as scheduled. The conference was also attended by:
a. Kent Walker, Director of the Respondent;
b. Sean D'almada-Remedios, of the Australian Hotel's Association NSW who had been engaged to represent the Respondent;
c. Anne Mullins, who was the Fair Work Commission Conciliator;
d. The Applicant;
e. The Applicant's support person, who was introduced as the Applicant's daughter;
7. During this conference an agreement was reached to settle the matter.
8. My recollection was that this agreement was effective straight away, as the Applicant chose to not have a "cooling off period", and that the conciliator was to prepare terms of settlement documenting the agreement that had been reached.
9. I was provided with correspondence about the settlement and the terms of settlement that accurately recorded the agreement reached that the conciliator had prepared and sent to our representative. A copy of these documents are attached and marked AB-01 and AB-02.
10. I did not receive the Applicant's signed copy of the terms and I am aware that this was not otherwise provided to the Respondent.
11. I did not sign or send the Applicant a copy of the terms signed by the Respondent and am aware that this was not otherwise provided to the Applicant. This was because we were awaiting for the Applicant to do so first.
12. Notwithstanding this, it is my recollection that the Applicant agreed to settle the unfair dismissal application.
13. Although the agreement did not require payment to be made until after a signed copy of the terms of settlement had been exchanged, on 28 November 2017 the Applicant was paid the agreed settlement sum of $2,600 (gross) in good faith and in accordance with the agreement. A copy of a payslip for this payment is attached and marked AB-03.
14. To date this payment has not been disputed or returned and has been retained by the Applicant.
15. On or around 30 November 2017 I drafted a statement of service that was to be provided to the Applicant in accordance with the Agreement upon her returning her signed copy of the terms. A copy of this is attached and marked AB-04.
16. On or around December 2017, the Applicant contacted me requesting to be provided with a separation certificate. On 12 December 2017 I provided this to her. A copy is attached and marked AB-05.
17. When I completed the separation certificate template, when the form asked to note the reason for employment ending, I selected "employee ceasing work voluntarily". This was because part of the agreement was to rescind the termination of the Applicant and allow her to resign instead.
18. The Applicant did not contact me after this and I am not aware of her otherwise contacting senior management of the Respondent.
19. On 28 November 2019 I received a copy of the Applicant's email to the Fair Work Commission. A copy of this is attached and marked AB-06. This was the first time I was made aware that the Applicant was disputing the settlement agreement.” 1
[27] Mr D’Almada-Remedios gave the following evidence:
“…
1. I am employed by the Australian Hotels Association New South Wales (AHA NSW) as an advisor in the Legal and Industrial Affairs Department of the AHA NSW.
2. On 16 November 2017 the AHA NSW was engaged to represent the Respondent in an unfair dismissal matter brought by the Applicant. I was the employee with carriage of the matter.
3. On 23 November 2017 I attended the Fair Work Commission conciliation telephone conference on behalf of the Respondent together with Kent Walker, and Anthony Bensley (director and licensee respectively of the respondent).
4. The Applicant attended the conciliation conference by telephone together with a support person who was introduced as the Applicant's daughter.
5. During the conciliation conference at no time did the Applicant, or the Applicant's daughter, allege that the Applicant did not have legal capacity to participate in the conference or make a binding decision.
6. At no time during the conciliation conference did the conciliator raise any issues concerning the Applicant's legal capacity to attend the conference or make a binding decision.” 2
[28] The Applicant gave the following evidence:
“[1] I was employed by Crown on McCredie Hotel for five years, until my employment was terminated in October 2017. During the conversation in which the Licensee (Mr Anthony Bensley) ended my employment, he also stated that I was the most committed staff member he had ever had. This was entirely true - I was dedicated to my staff members and customers alike, often completed work-related tasks in my own time, and constantly strove to improve the Hotel in any way I could. Mr Bensley once phoned me to ask me to work, knowing full well I had a dinner booked for myself and 50 people at an associated hotel. I agreed without hesitation. He was only joking and just wanted to see what I would say, but told me later he had used that story to brag to other licensees about how good his managers were. No request was too much, and I regularly went above and beyond. I loved my job and believed I would work there until the day I died; often joking that I would like my ashes sprinkled in the garden. Never in my wildest dreams would I do anything to jeopardise this job I loved so much, and to be fired for something I did not do was utterly devastating. This is why I filed an unfair dismissal application (see Annexure 1).
[2] When the Licensee (Mr Anthony Bensley) gave me my notice, I was in shock and could not believe what was happening. I remember going into the ladies toilets, sinking to the floor and sobbing. I continued to sob in the carpark as I told my partner, and the drive home is a blur (and it is lucky my partner was present to drive me as I would have been incapable of driving myself). The daily sobbing lasted a few months (though that too is a blur), and still has not entirely subsided to this day. I try to be strong and “suck it up”, but keeping it in only makes it explode worse when I cannot keep it in anymore.
[3] Much like the months of daily sobbing, I spent the mediation phone call in tears, and was quite clearly highly distressed. When I tried to talk about the alleged incident during the phone call, I was told “no argy bargy”. I believed the phone call was for me to speak about the fact that I was fired for something I did not do. To plead my case, and then to also try to come to an agreement about how to move forward in the situation. At the time, all I wanted was my job and my life back. I do not feel the proper process was explained to me by the mediator in a way that I was able to understand at the time.
[4] At no time do I remember anyone saying “that’s it, it’s over, if you agree to this on the phone you have no further recourse” or anything along these lines. I believed that as long as I did not sign anything, the matter was not final and that I could decide what to do later when I could think more clearly. This belief was supported by references to signing documents in the conciliator’s letter and the terms of settlement (see Annexures 2 & 3). I did think that during mediation we would try to resolve the matter with terms we could both live with, and this was my intention for the mediation. However, the resulting terms were not ones I could live with, and I did not intend for them to be final until I signed the document.
[5] With regards to keeping the money the Hotel sent me, it never occurred to me to send it back. I did not ask for the money following the mediation or need to go collect it - it just appeared in my bank account like my pay did. It then just went towards my automatic bills as normal, without a second thought. It did not even occur to me that keeping the money meant I was in agreeance with the settlement and things would be finalised. If I had realised that, I would have sent the money back. If it was a large amount of money, it may have registered that I needed to make a decision about it, however it was the equivalent of around two weeks of my normal pay.
[6] Had I been in my right mind at the time of mediation, there is no way I would have accepted $2600 as enough payment for the five years of my life I gave to the Hotel, and that fact I had been fired for something I did not do.
[7] I have been through a lot in my life but this has truly been the most difficult thing I have ever had to deal with. I did not have any mental health issues or need anti-depressants prior to his happening (see Annexure 4). Every night, I dream about the Hotel. Sometimes I dream I am back at work, running the raffles, and all is well. I then wake to the shattering realisation this is not the case. Other nights, I dream that Mr Bensley phones me and asks me to go back to work, and I wake up crying because even in my sleep the emotion becomes too much. If I take sleeping pills I do not dream as much, but feel terrible the next day. I have been seeing a psychologist (see Annexure 5) and practice relaxation techniques each night in the hopes that I can fall asleep without my mind becoming focused on the Hotel.
[8] They say “time heals all wounds” but I have not found this to be true. It has been two years and I am still a mess, and unable to think or talk about the matter without being brought to tears. I try not to think about it, but it is easy to be triggered by something on television or in a book, or a passing comment made by anyone I know. I should be able to have fond thoughts of the place I once worked and the job I loved, but instead it is all just hurt and questions of “why?”. I have been unable to get another job because of the level of distress this situation has caused.
[9] Since I am still a mess to this day, it is not hard to imagine how much worse I was around the time of my termination and the mediation. I was definitely unable to think straight or make rational decisions at the time.
[10] When the one year anniversary of my termination was coming up, I tried to re-open my case to seek closure, but was still not in any mental state to pursue this properly. It just brought the things I was trying to shove deep down, to the surface. However when the two year anniversary came around and I was still not coping, I knew I had to try to be heard. I did not address the matter properly for two years because I was living in denial and trying not to think about it, as when anything even remotely related to the situation is mentioned, I break down. This is why it has taken so long for me to try to undertake this process.” 3
Submissions
[29] The Respondent submitted that,
“Background
1. On 5 November 2017, the Applicant made an unfair dismissal application pursuant to s.394 of the Fair Work Act 2009 (Cth) (Act), alleging that she was unfairly dismissed from her employment with the Respondent (Substantive Application).
2. As will be set out in these submissions, on 23 November 2017 the Applicant and Respondent agreed to fully and finally settle the Substantive Application, in an agreement which was immediately binding upon the parties.
3. On 24 November 2019 the Applicant contacted the Commission seeking to "re-open" the Application.
4. In response to this, and pursuant to directions issued by the Commission dated 12 December 2019, the Respondent makes an application to have the Substantive Application dismissed, pursuant to section 587 of the Act.
Legislative Provisions
5. Section 587 of the Act provides:
(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.
Basis for Application
6. The Respondent submits that the binding agreement that was reached on 23 November 2017 extinguishes any right for the Applicant to further agitate the matter, and on this basis her claim has no reasonable prospects of success.
7. In this regard the Respondent relies upon Australian Postal Corporation v Gorman in which Besanko J held:
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.2
8. Put simply once an agreement to settle a matter is reached, this agreement extinguishes the pre-existing cause of action, and pursuing a claim in light of this means that the claim is being pursued with no reasonable prospects of success.
9. This position is premised on there being an agreement between the parties. The question of whether there was or was not a binding settlement agreement is a question of fact, with reference to legal principles.
10. The Respondent submits that the existence of an agreement is abundantly clear on the evidence, in particular, in the fact that:
a. The parties attended to a conciliation conference on 23 November 2017, and reached a binding agreement in the discussions that ensued during this conference;
b. Correspondence was issued by the Fair Work Commission Conciliator on the same date confirming this to be the case, attaching with it the terms of the agreement documenting the terms of settlement;
c. The Respondent subsequently undertook certain actions in accordance with the agreement, including paying the Applicant settlement monies, drafting a statement of service, and acknowledging the Applicant's retrospective resignation in dealing with external parties.
d. The Applicant did not question the validity and/or existence of the Agreement for some 2 years and after the receipt of benefits under the Agreement terms.
11. The Respondent submits that the fact that a binding agreement was reached is clear notwithstanding that the terms of settlement were not executed or exchanged between the parties.
12. While the terms of service required the parties to sign and exchange copies of the document before certain obligations under these terms where required to be performed, the Respondent submits the existence of the agreement itself was not contingent upon a document being executed.
13. The Respondent submits that in this regard the nature of the agreement between the parties is analogous to that of the second category referred to by the High Court of Australia in Masters v Cameron where a binding contract is formed in circumstances whereby:
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.
14. The Commission and its predecessors have on multiple occasions upheld that an agreement characterised as one falling in the second category of Masters v Cameron to settle an unfair dismissal application, is one which extinguishes the Applicant's claim to pursue the matter.
15. This has included in factual circumstances where there was no signing of a terms of settlement document that was to be signed to reflect the agreement reached.
Conclusion
16. The Respondent submits in accordance with the above mentioned decisions, the agreement on 23 November 2017 extinguishes the Substantive Application, and that continuing the application in these circumstances would be doing so with no reasonable prospects of success.
17. Accordingly, the Respondent submits that the Application should be dismissed pursuant to section 587 (1) (c) of the Act.” 4
[30] The Applicant submitted that:
“[1] I was unfairly dismissed from my managerial position at Crown on McCredie on 18/10/2017, after five years of employment. Specifically, my employment was terminated as a result of a false allegation that I was verbally abusive towards a group of children. Given the fact I did not behave in the manner alleged, I submitted an application for unfair dismissal with the Fair Work Commission on 05/11/2017 (see Annexure 1).
[2] We then participated in a conciliation on 23/11/2017, resulting in terms of settlement (see Annexure 2). I do not believe these terms of settlement constitute a binding agreement for several reasons.
[3] Firstly, the terms of settlement were not signed by either party. Although I understand that not all agreements must be signed, in this case a number of terms of settlement were contingent upon the agreement being signed by both parties. At various points, the terms of settlement refer to the document being signed by both parties. My failure to sign the document demonstrates my lack of intention to be bound by the terms of settlement. In contrast to Banister v Queensland Rail Limited [2012] FWA 3973 (in which the terms of settlement were initially signed), I did not sign the document at any point.
[4] Information from the Commissioner states: “When an employee seeks to pursue an application: after an executed settlement agreement has been reached between the parties, and the settlement has been paid; the application can be dismissed for being frivolous or vexatious or for having no reasonable prospect of success.” However, Term 3.12 notes that “the execution will be complete when each party holds a copy of the terms of settlement signed by the other party”, which never occurred. As such, there is no “executed settlement agreement” in this case. The Respondent also acknowledges in their submissions that the agreement was not executed. Term 3.12 of the terms of settlement also makes it clear that the intention was for the agreement to become binding upon both parties providing their signatures.
[5] I submit that the agreement arising from conciliation falls into the third category mentioned in Masters v Cameron [1954] 91 CLR. That is, “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”. In such circumstances, parties “ought not to be held bound till they have executed the formal agreement”.
[6] I was of the view that the agreement was not binding until I had signed the document and submitted an F50 form notifying the Commision I wished to discontinue the matter (which I did not do). This view is also supported by the conciliator’s letter (see Annexure 3), which states “As this is an agreement reached between the parties, you must send your signed terms to the other party” and “The Applicant will need to file a Form F50”.
[7] The fact the Respondent also did not sign the document calls into question whether they intended to be legally bound. The Respondent has submitted that they did not sign the
document as they were awaiting my signed document first. However, if they intended to execute the document they could have done so without receiving my signed copy first.
[8] Several terms of the settlement were not complied with, including the Respondent providing me with a statement of service (as per clause 3.5). This statement of service was never received, although the Respondent claims this was drafted in November 2017. I did not attempt to obtain the statement of service, due to already having significant difficulty obtaining a Separation Certificate to provide to Centrelink. I required this certificate to prove my employment status in order to claim Centrelink benefits, due to being unemployed and emotionally unable to return to the workforce. I contacted Anthony Bensley via text message on 27/11/2017 (as per clause 3.6 that he was to be the point of contact), however received no response. Several requests were made by Centrelink directly to the Hotel before this was provided on 12/12/2017.
[9] Clause 3.11 prohibited either party from disparaging or denigrating the other, which was not upheld by the Respondent. An employee of the Hotel informed a fellow employee she was told that I “threw her under the bus” during the conciliation, which was false as I had never mentioned her name. Providing false information about me that casts me in a negative light constitutes denigrating and disparaging me.
[10] Term 3.7 states that I would be discharging and releasing the Respondent from all future liability in relation to my employment upon terms 3.1-3.6 being complied with. Given the fact the terms were not complied with in their entirety, this clause discharging liability did not come into play.
[11] I did not rely on the terms of settlement by compelling the respondent to comply with said terms or to provide their signed copy of the terms of settlement. If I had intended the terms of settlement to be binding and was in the correct frame of mind to do so, I would have signed the document, and requested that the Respondent sign their copy and adhere to the terms.
[12] As per Gibbons v Wright (1954) 91 CLR 423, for an agreement to be legally binding, it is required that each party be of “such soundness of mind as to be capable of understanding the general nature of what he is doing by his participation.”
[13] I was not of sound mind before, during or after the conciliation, and continue to experience mental health issues to this day. These mental health concerns have arisen solely as a result of my unfair termination. I visited my GP in November 2017, suffering from significant depressive symptoms and grief regarding the loss of my job (see Annexure 4). I have been engaged with a psychologist since November 2017 in an attempt to manage my symptoms, however my success has been limited (see Annexure 5). The level of distress I was experiencing at the time impaired my capacity to understand the conciliation process, and the agreement I would potentially be entering into.
[14] I did not fully understand the purpose or procedures pertaining to the conciliation. Whilst participating in the conciliation, I attempted to put forward my perspective and the fact that I had not behaved in the alleged manner. This was met with a response from the conciliator shutting me down and indicating they did not want any “argy bargy”. I did not understand that
conciliation was not going to provide an opportunity for me to state my case and fight the allegations, or that subsequent to the conciliation I would never receive the chance to clear my name. I just wanted the situation to be over as I found the process traumatic and was deeply distressed. As such, I was unable to comprehend the situation or properly consider the terms being offered (nor assess whether they were in my best interests).
[15] Had I possessed the capacity to properly consider the terms of settlement, I would have realised that the terms were not fair or agreeable. I lost the job to which I had unconditionally devoted myself for five years, and along with it lost many aspects of the life I knew. I have been unable to return to the workforce since my termination due to my emotional state. A sum of $2600 is by no means satisfactory compensation for such losses when the allegations against me were entirely false.
[16] I did not take any action in order to obtain the financial compensation following conciliation, such as request the funds or cash a cheque. It is acknowledged that I also did not return the funds, however this once again relates to my state of mind. I did attempt to express my disagreement with the resolution (albeit one year later) on 04/10/2018, coming up to the anniversary of my dismissal. Once again, my state of mind prevented me from pursuing this matter further at the time.
[17] If I were able to think clearly at the time of my dismissal (and properly comprehend the processes for unfair dismissal cases), I would have pressed for the matter to go to trial. Additionally, I would have sought independent legal advice to assist me in the decision- making process and ensure I had adequate understanding of procedures and potential agreements. The Respondent was represented by the Australia Hotels Association, whereas I had no legal representation.
[18] My lack of sound mind was abundantly clear during the conciliation, thus it is reasonable to believe the Respondent was aware of my level of distress and lack of understanding. Mr Bensley, in particular, knew me quite well after working together for some time. My extreme distress upon his termination of my contract and during the conciliation were a stark contrast to the rational, composed, confident and positive person he knew me to be. In comparison, my presentation around the time of my termination and conciliation was that of despair, depression, confusion and incoherence.
[19] I submit that no binding agreement was reached as a result of the conciliation occurring on 23/11/2017. I therefore request the case is re-opened to allow me to receive a fair trial and the opportunity to have the unfair dismissal matter properly investigated. 5
[31] In reply the Respondent submitted that:
“Background
1. The Respondent refers to the Applicant's submissions filed with the Commission and served on 22 January 2020, together with the Statement of Megan Bell and attachments also filed (the Applicant's Submissions).
2. Broadly, the Applicant's submissions go to two issues:
i. A purported lack of capacity to make a decision to enter an agreement on 23 November 2017;
ii. That no agreement existed as she had not signed the terms of settlement;
3. The Respondent responds to these submissions as follows.
The Applicant’s Purported Lack of Capacity
4. The Applicant's Submissions allege that the Applicant was not of "sound mind", did not possess the capacity to properly consider the terms of the settlement, and was unable to think clearly at the time of the dismissal, at paragraphs 12, 13, 14, 15, 17, and 19.
5. The statement of Anthony Bensley dated 8 January 2020, in paragraph 5 outlines the attendees of the conciliation conference held by telephone with the Fair Work Commission on 23 November 2017, and identifies that, amongst others, Anne Mullens the Fair Work conciliator, and the Applicant's support person who was introduced as her daughter, also attended.
6. As specified in the affidavit of Sean D'Almada-Remedios, neither the conciliator nor the Applicant's support person expressed any concerns during the conference that Applicant did not have the capacity to participate in the conciliation conference or to make decisions in relation to the Applicant's claim, including an agreement to settle her claim.
7. Although the medical certificate from Dr. Chan dated 15 January 2020 and the report from Irene Mullen psychologist dated 6 November 2019 refer to the Applicant presenting with symptoms of depression, neither Dr. Chan nor Ms. Mullen provide a diagnosis or prognosis that supports the Applicant's assertion that she did not have capacity to make a binding agreement.
8. The Respondent observes that although it would be expected that Dr. Chan and Ms. Mullen would keep detailed records, neither of these two practitioners specified the date in November 2017 when the Applicant was examined.
9. The Respondent submits that this omission is important as the conciliation conference occurred on 23 November 2017 and the date in November 2017 when the Applicant was examined would be a relevant consideration of her capacity at the conference.
10. The Respondent submits that the evidence of Dr. Chan and/or Ms. Mullen does not support a finding that the Applicant did not have capacity to make a binding decision at the conciliation conference, and therefore no such finding can be made.
11. The fact that the conciliator prepared terms of settlement provides a clear inference that the conciliator was under no apprehension that the Applicant did not have capacity to make an agreement, and supports the evidence of Mr. D'Almada-Remedios, and an inference, that the Applicant's daughter who was a support person had no concerns, and did not express any such concerns at the conciliation conference.
12. The Respondent further submits that the mere existence of a diagnosis of depression, in itself, does not lead to a reasonable inference that the Applicant did not have legal capacity to make a binding agreement.
Existence of an Agreement
13. The Respondent's position that a binding agreement (irrespective of an absence of an executed written document) was entered into by the parties on 23 November 2017 is comprehensively set out in its submissions dated 8 January 2020.
14. The Respondent relies upon these, as well as the following responses to what has been raised in the Applicant's submissions in regard to the existence of an agreement.
15. The Respondent submits that the Applicant has not advanced any basis that supports her submission that no binding agreement was reached, despite her assertion that she held a belief that a binding agreement was dependent on a written document being executed, or that the agreement should be characterised within the third category of agreement in Masters v Cameron.
16. Neither the terms of settlement, which contain a clause providing that they may be executed in counterparts, or correspondence from the conciliator advising the parties to exchange copies of the terms of settlement amongst themselves rather than sending these to the FWC, constitute evidence that the Agreement required written execution before being enforceable.
17. The Respondent further submits the release in clause 3.7 of the terms of settlement being contingent upon the document being executed does not detract from the fact that an overall agreement was reached, and that the Respondent relies on this overall agreement (rather than the specific release in clause 3.7) as the source of extinguishment of the Applicant's right to further advance the substantive application.
18. Additionally, within the Applicants' submissions there are numerous references which appear to support that the Applicant was under an impression that an agreement existed, including:
i. Her contacting Mr Bensley for a separation certificate as he was designated as a point of contact under the terms of settlement; and
ii. Her being aggrieved that the Respondent has allegedly denigrated or disparaged her in breach of clause 3.11 of the Agreement;
Conclusion
19. In addition to these submissions, and the affidavit of Sean D'Almada Remedios, the Respondent also relies on the submissions and evidence filed on 8 January 2020 in submitting that the application should be dismissed pursuant to s587(1)(c).” 6
Consideration
[32] The issue to be determined is whether the parties reached a concluded agreement on 23 November 2017. This is a question of fact.
[33] In Masters v Cameron, 7 the High Court held that where parties who have been negotiating reach agreement upon terms of a contractual nature and also agree that the matter of their negotiation shall be dealt with by a formal contract, the case may belong to any of the 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 full or more precise but not different in effect.
2. It may be a case in which the parties have completely agreed upon all of 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. 8
[34] In the present matter I make the following findings of fact:
a) The Applicant’s employment was terminated on 18 October 2017.
b) On 5 November 2017 the Applicant made the UFD Application.
c) A conciliation conference occurred on 23 November 2017.
d) The Applicant represented herself. She was assisted by a support person (her daughter).
e) At the conclusion of the conciliation conference the parties agreed that:
i. The Respondent would pay the Applicant $2,600,
ii. The Respondent would rescind the dismissal and allow the Applicant to resign with effect from 18 October 2017,
iii. The Respondent would provide a Statement of Service,
iv. Anthony Bensley would be a point of contact for future employers making enquiries about the Applicant’s employment.
f) The parties agreed to waive any cooling-off period.
g) It was agreed that the Commission Conciliator would send the parties a settlement agreement.
h) A settlement agreement was drafted and sent to the parties containing the following terms:
v. The Respondent would pay the Applicant $2,600 gross within 7 days by EFT,
vi. The Respondent would rescind the dismissal and allow the Applicant to resign with effect from 18 October 2017,
vii. If the Applicant returned a signed settlement agreement the Respondent would provide a Statement of Service,
viii. Anthony Bensley would be a point of contact for future employers making enquiries about the Applicant’s employment,
ix. If the Respondent complied with its requirements, the Applicant would release the Respondent from any claims.
x. The Respondent would release the Applicant from any claims.
xi. There would be no release from claims relating to work related injuries or superannuation.
xii. The settlement would be confidential.
xiii. The Agreement could be executed in counterparts.
i) No one complained about the terms of the settlement agreement.
j) No one signed the settlement agreement.
k) On 28 November 2017 the Respondent paid the Applicant $2,600 gross (Payment) by EFT.
l) The Applicant retained the Payment.
m) Although the Applicant did not sign the Settlement Agreement, on 12 December 2017 the Respondent provided the Applicant with a Statement of Service. The Statement of Service stated that the Applicant had “resigned from her employment.”
n) On the Australian Government Employment Separation Certificate the Respondent recorded the reason for termination as “employee ceasing work voluntarily”.
[35] Having regard to the findings of fact I have made above I am satisfied that the agreement reached was a Masters v Cameron class 1 type of agreement.
[36] I am satisfied that on 23 November 2017 the parties:
a) reached finality in arranging all the terms of their bargain;
b) intend to be immediately bound to the performance of those terms (hence the waiving of the cooling-off period); and
c) proposed to have the terms restated in a form which will be full or more precise but not different in effect.
[37] Having regard to the terms of the Settlement Agreement drafted by the Commission it is one that more precisely deals with the terms agreed in the conciliation. It is no different in effect. It is a classic Masters v Cameron class 1 type of agreement.
[38] There was nothing in the bargain stuck by the parties that made agreement between them conditional upon the signing of the Settlement Agreement. The Applicant’s failure to sign the Settlement Agreement disentitled her to a Statement of Service. Notwithstanding that she was not entitled to a Statement of Service the Respondent issued her with one. Execution was to be complete when both parties signed, but that did not make the Settlement Agreement contingent upon both parties signing. This was not a Masters v Cameron class 3 type of agreement as contended by the Applicant.
[39] The fact that the Conciliation invited a Notice of Discontinuance (NoD) from the Applicant does not mean that there was not release being provided by the Applicant if the NoD was not filed. It was merely an administrative matter that had no bearing upon the agreement reached between the parties.
[40] I reject the Applicant’s contention that the fact that neither party signed the Settlement Agreement is evidence that neither party had an intention to be bound by it. The conduct of the Respondent that was consistent with the terms of the bargain reached is clear evidence of its intention to be bound. So too the Applicant’s retention of the Payment.
[41] To the extent that the Applicant says there has been a breach of the non-disparagement clause in the Settlement Agreement, her rights in relation to the same lay elsewhere. If there has been a breach of the Settlement Agreement that does not mean there was no agreement reached. Clearly there was.
[42] The lack of formal signing of the terms of settlement does not alter the legal position of a settlement having been reached. In McKinnon v Eventide, 9 Commissioner Bissett stated:
“The question of whether or not there was a binding agreement reached between the parties is a matter of fact. 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 class it would, following Masters v Cameron, be a binding agreement”. 10
[43] In so far as the Applicant now seeks to raise issues about her capacity to agree to a settlement on 23 November 2017, there is no evidence before that would make good that contention. The self-reporting/diagnosis of the Applicant is not sufficient. The medical evidence provided by the Applicant is also of no assistance. It does not address the Applicant’s state of mind on 23 November 2017. The fact that the Applicant was receiving some treatment of depression in November 2017 is not evidence of a lack of capacity to enter into the agreement she reached on the 23rd of that month. Dr Chan (Annexure 4 to Exhibit 9) wrote that the Applicant’s “depressive symptoms … negatively impacted her general well being.” He wrote nothing about the Applicant’s cognitive ability. The psychologist’s letter (Annexure 5 to Exhibit 9) was even less specific to 23 November 2017 and of no utility. Finally, I note that there is no evidence that anyone raised an issue about the Applicant’s ability to participate in the conciliation on 23 November 2017. The Applicant was distressed, but that is not uncommon. It is not necessarily evidence of a lack of legal capacity.
[44] As stated above, I am satisfied the concluded agreement between the parties came within the first class of agreements as outlined in Masters v Cameron.
Commission’s power to dismiss an unfair dismissal application
[45] In Australian Postal Corporation v Gorman, 11 Besanko J of the Federal Court of Australia said that the existence of a binding settlement or “accord and satisfaction” extinguishes the existing cause of action. His Honour stated:
[31] 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.
[32] It seems to me that the fact of an accord and satisfaction can either be raised under the Act at an ‘interlocutory’ stage and at the final hearing or it cannot be raised at all. As it is a complete answer to a claim there would be no reason why it could be raised at a final hearing but not at a preliminary stage under a section such as s 587.
[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.
[46] As is clear from Australian Postal Corporation v Gorman, 12 the Commission has the power to dismiss an application on the basis that it has no reasonable prospects of success if there is a binding agreement between the parties. Section 587(1) of the FW 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.
Note: For another power of the FWC to dismiss an application for a remedy for unfair dismissal made under Division 5 of Part 3 2, see section 399A.
(2) Despite paragraphs (1)(b) and (c), the FWC must not dismiss an application under section 365 or 773 on the ground that the application:
(a) is frivolous or vexatious; or
(b) has no reasonable prospects of success.
(3) The FWC may dismiss an application:
(a) on its own initiative; or
(b) on application.” [emphasis added].
[47] I am satisfied that an agreement was reached between the parties on 23 November 2017 and that the agreement was of the first class in Masters v Cameron. 13Consequently, I exercise my discretion to dismiss Ms Bell’s application under s 587(1)(c) of the FW Act on the basis that it has no reasonable prospects of success.
Conclusion
[48] For the reasons outline above, I find that Ms Bell entered into a binding settlement agreement of her claim and therefore, her application has no reasonable prospects of success. I dismiss her application for an unfair dismissal remedy.
[49] An order [PR717236] to this effect will be issued simultaneously with this decision.
COMMISSIONER
Appearances:
The Applicant for herself.
Mr M Dunne, solicitor of Australian Hotels Association NSW, for the Respondent.
Hearing details:
2020.
30 January.
Sydney.
Printed by authority of the Commonwealth Government Printer
<PR717235>
1 Exhibit 7 (footnotes omitted).
2 Exhibit 11.
3 Exhibit 9.
4 Exhibit 6 (footnotes omitted).
5 Exhibit 9.
6 Exhibit 10 (footnotes omitted).
7 (1954) 93 CLR 353.
8 Ibid 360.
9 [2013] FWC 5273.
10 Ibid [48].
11 [2011] FCA 975.
12 Ibid [31] – [33].
13 (1954) 93 CLR 353, 360.
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9
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