Mr Owen Lockett v Sugar Research Australia

[2015] FWC 7686

[2015] FWC 7686

FAIR WORK COMMISSION

DECISION

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

Mr Owen Lockett
v
Sugar Research Australia
(U2015/4527)

SENIOR DEPUTY PRESIDENT RICHARDS BRISBANE, 10 NOVEMBER 2015

Summary: unfair dismissal – deed of settlement executed – claimed incapacity etc – evidence of clarity of mind, organised thought and cognitive cohesion – deed not vitiated by conduct of employer – deed complete answer to application – deed not voided by uncertain term – rectification – intended meaning.

[1] On 2 April 2015, Mr Owen Lockett made an application for an unfair dismissal remedy under s.394 of the Fair Work Act 2009 (“the Act”). Mr Lockett was ostensibly made redundant from his position as a Records Coordinator with Sugar Research Australia (“SRA”) on 12 March 2015, and complained that his position in actuality was still required, and his redundancy was a sham.

[2] Mr Lockett’s employer - SRA - contended that the Commission was jurisdictionally barred from entertaining Mr Lockett’s application for reasons that Mr Lockett and SRA had jointly entered a Deed of Release (“the Deed”) on or about 16 March 2015. Mr Lockett rejected this objection, ostensibly on grounds that he did not understand the Deed, and entered the Deed under duress or in a confused state of mind.

[3] I sent to Mr Lockett (and to the employer) prior to the hearing various decisions of the Commission that set out the authorities (both Commission and Court) in relation to the matter and illuminate issues relevant to those considered below.

The Deed

[4] The deed set out the terms on which the parties wished to settle all claims in relation to Mr Lockett’s employment with SRA (clause 1 of the deed).

[5] Mr Lockett, by entering the Deed and accepting certain considerations (such as an additional eight weeks’ pay) undertook to release and discharge SRA from and indemnify it against all claims (clause 2). The scope of the meaning of “claims” was set out in clause 7 of the Deed.

[6] The Deed stated (at clause 5) that SRA may use the Deed against Mr Lockett as a bar to any proceedings arising out of the matters covered by the Deed.

[7] The Deed stated (at clause 4) that Mr Lockett “warrants that he understands the effect, nature and extent of this Deed.” Mr Lockett “further warrants that he has been given the opportunity to obtain legal advice in relation to this Deed.”

[8] Both Mr Lockett and a representative of SRA executed the deed.

[9] At the bottom of the executed deed Mr Lockett handwrote the following:

“On reading the terms and reasons for my termination I must say that I am very disappointed. However, in the immortal words of Derryn Hinch, “That’s life”. I want it to be known that I enjoyed the opportunity of bringing SRA from the 1980s into today’s electronic world and I was able to successfully design and implement a records solution for SRA. I worked hard and single handedly without any Records Management advice from Steve Comerford. In fact the whole time I worked in SRA Steve never had a single meeting that he arranged. I was self managed and worked under duress for the best part of two years, through lack of support and whiteanting from Sandra Long. Even though I continued to provide and supply professional service to SRA clients, even though advice from the Executive Director was not to use the system I was developing, thus various clients not using the system, in which I have proof I would hope that considering my excellent service one would hope I would receive an excellent reference, if requested. I wish SRA future success.” (sic)

Mr Lockett’s claims

[10] Mr Lockett claimed under examination that he was “flustered” and shocked at the time of the dismissal and he was “not on the same planet” as other persons. He claimed that he was under duress, and defined this as being duress arising from “the situation” in which he had been placed by his employer as a consequence of his termination.

[11] Notwithstanding his state of mind, Mr Lockett indicated that upon his termination being conveyed to him by Ms Flowers, the Human Resource Manager for SRA, he nevertheless composed himself and shook hands with Ms Flowers and another employee representative before departing the workplace.

[12] Mr Lockett left work with paperwork including the deed of settlement. Mr Lockett understood that he had two weeks in which to consider whether or not he wished to enter the deed of settlement.

[13] On what appears to be 16 March 2015 - some four days after his termination was communicated to him by Ms Flowers - Mr Lockett appeared at the workplace and entered into the deed of settlement with SRA.

[14] On the day the Deed was entered into, Ms Flowers gave evidence (that was not rebutted by Mr Lockett) that Mr Lockett had indicated to her that he had obtained legal advice in relation to the Deed. It would have been an easy thing for Mr Lockett to simply deny that he ever obtained any legal advice about the Deed, but he did not do so. His only challenge to Ms Flowers claim was that he could not recall making those comments to her.

[15] Mr Lockett attempted to convey to the Commission his state of mind in executing the Deed. He indicated that his “brain was in a meltdown process” and that he did not have an understanding of the Deed. On occasions Mr Lockett indicated that though he had opened the envelope he didn’t read the Deed. At other times in his evidence he claimed that he had partially read the Deed, or else that he didn’t “have a clue” what the Deed was about. Mr Lockett otherwise claimed that he felt that he “had no choice and had to go through the motions” and execute the Deed.

[16] Mr Lockett agreed that he had understood by executing the Deed that he was “partaking” of its terms (as he put it) but otherwise contended that the content of the Deed was beyond his understanding or then current capacities.

[17] Mr Lockett also contended late in his evidence (and notwithstanding his prior evidence) that he was being treated by his general practitioner for an anxiety or depressive related condition or else that his general practitioner had concerns about his mental health and had directed him to a psychologist. Mr Lockett also claimed that he was under some unspecified medication in relation to a workplace injury (which presumably may have affected his judgement at some point).

[18] At the time of the hearing proper Mr Lockett led no evidence in respect of these matters (though he had troubled himself to provide a copy of a letter from a psychologist who had attended upon him in the month following his dismissal).

Consideration

[19] Regardless of whether or not Mr Lockett potentially has further evidence in his possession as to what his general practitioner may have prescribed for him by way of pain relief or whatever the general practitioner’s view may have been about Mr Lockett’s mental well-being, the direct evidence adduced in the proceedings about Mr Lockett’s behaviour at the time he executed the Deed points to the conclusion Mr Lockett entered the Deed in a relatively composed state of mind. There are various reasons for my conclusions in this regard.

[20] Mr Lockett returned to the workplace to enter the Deed some four days following his dismissal. He did so on the basis of asserting that he had received legal advice. During the four day period Mr Lockett was not subject to any directions from his employer. Mr Lockett wrote at some length on the bottom of the Deed of settlement (in the terms I have set out above) and did so in a manner that exhibited some clarity of mind and cognitive cohesion. Mr Lockett therein complained about various workplace relationships and reflected on his contribution to the employer in his written notation to the Deed, but he gives no evidence of disorganised thought or expedition driven by perceived duress, or otherwise. Mr Lockett might reasonably have referred to such concerns when composing his notation to the Deed. Mr Lockett also entered into email exchanges with his employer about the consideration that formed the centrepiece of the deed. This strongly suggests that Mr Lockett was aware of the beneficial consideration arising from entering the Deed.

[21] Mr Lockett was no doubt disappointed by the turn of events and understandably felt aggrieved about the circumstances, but this does not signal that his conduct as observed yields material evidence in support of a proposition that he was incapacitated at the time he executed the Deed, and entered into the Deed unknowingly or unwittingly and without understanding.

[22] Further, there was no claim at all by Mr Lockett that his capacities were so limited during the relevant period (12-16 March 2015) that he could not exercise his reasonable judgement in relation to matters affecting his interests. He may not have been in perfect health, he may have been on pain relief medication, he may have been ill at ease with his circumstances generally and warranting some counselling, but his behaviours nonetheless during the relevant period indicate a capable, organised and active mind.

[23] There is no evidence either in this matter that the conduct of SRA was in some manner demonstrably coercive and that the deed would be vitiated for this reason. If there had been such a claim, it reasonably would have been expressed in Mr Lockett’s notation to the Deed, in which he cites other sources of his workplace anxieties.

[24] I have indicated previously that the Commission authorities indicate that a deed of release, knowingly and properly executed, serves as a bar to an application for a remedy in relation to an alleged unfair dismissal. Thus it was commented upon by the Full Bench in Stork Electrical Proprietary Limited v Le Good (1 Dec 747/99 M Print R6813, 12 July 1999) that an application under s.170CE of the Workplace Relations Act 1996 (in relation to an unfair dismissal remedy) could not be proceeded with where a deed of release had been properly executed:

[36] We agree with the proposition inherent in the appellant's submission concerning the deed of release that the Commission should not permit a party to a s.170CE application to depart from a deed of release which has been knowingly and properly executed.

[25] Subsequent Commission authorities have reinforced this same proposition.

[26] In this matter there arose an issue as to one of the terms of the Deed not being agreed by the employer to reflect the Deed as intended. In effect, there was a miscalculation of the gross salary calculation of the eight weeks pay provided to Mr Lockett in consideration. This does not detract from the binding nature of the deed as such. Such terms if misapplied may be matters for court-related rectification if necessary.

[27] In these respects, I note that in the judgment of the High Court in Upper Hunter Country District Council v Australia Chilling and Freezing Co (1968) 118 CLR 429, Barwick CJ stated as follows:

“The approach to be adopted was expressed by Barwick CJ in Upper Hunter County District Council v Australian Chilling & Freezing Co Ltd (at 436): 'But a contract of which there can be more than one possible meaning or which when construed can produce in its application more than one result is not therefore void for uncertainty. As long as it is capable of a meaning, it will ultimately bear that meaning which the courts, or in an appropriate case, an arbitrator, decides is its proper construction: and the court or arbitrator will decide its application. The question becomes one of construction, of ascertaining the intention of the parties, and of applying it. … So long as the language employed by the parties, to use Lord Wright's words in G Scammell & Nephew Ltd v Ouston [1941] AC 251 is not "so obscure and so incapable of any definite or precise meaning that the court is unable to attribute to the parties any particular contractual intention", the contract cannot be held to be void or uncertain or meaningless. In the search for that intention, no narrow or pedantic approach is warranted, particularly in the case of commercial arrangements. Thus will uncertainty of meaning, as distinct from absence of meaning or of intention, be resolved.”

[28] Uncertainty, therefore, in a contract will not render the contract void. The issue here will turn on what the parties intended to be the meaning of the term in which eight weeks’ pay was to be provided in consideration.

Legislative Provisions

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.

[…]

[29] The scope of s.587(1)(c) of the Act is such that an application barred by a binding deed may be dismissed by the Commission.

Conclusion

[30] Mr Lockett entered into a deed of settlement that provides for a bar to further claims by him against SRA. The Deed provides a complete answer to the claims for an unfair dismissal remedy. The application is dismissed under s.587(1)(c) of the Act.

SENIOR DEPUTY PRESIDENT

Appearances:

O. Lockett, applicant

K. Luke of Thompson Geer Lawyers, for the respondent

Hearing details:

2015.

By telephone:

3 November.

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