Rodney Nicholas Newell v D & R Tarpaulins
[2022] FWC 444
| [2022] FWC 444 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.394 - Application for unfair dismissal remedy
Rodney Nicholas Newell
v
D & R Tarpaulins
(U2021/9787)
| COMMISSIONER BISSETT | MELBOURNE, 1 MARCH 2022 |
Application for an unfair dismissal remedy – request from applicant to re-open closed matter- binding agreement reached at conciliation – dismissal under s.587 at the Commission’s initiative.
Background
On 2 November 2021 Mr Rodney Nicholas Newell (the Applicant) made an application to the Fair Work Commission (Commission) for an unfair dismissal remedy under s.394 of the Fair Work Act 2009 (FW Act). Mr Newell alleged he was unfairly dismissed by D & R Tarpaulins (the Respondent) on 2 November 2021.
On 2 December 2021 the application was listed for staff conciliation where the matter settled. Correspondence advising the parties of such was sent to the parties on this date. Terms of Settlement were placed on the Commission file and the file was administratively closed.
On 1 February 2022 the Applicant requested the application be reopened, advising:
I would like my case reopened as I did not receive my settlement, from D&R I im struggling finding a new job and would like someone to speak with about my case much appreciated Rodney… I am going through a lot of stress because of this situation also because I’m going into financial hard ship..
That request was referred to me as and the matter was listed for Mention on 8 February 2022. During that Mention the Respondent provided correspondence to my chambers dated 7 December 2021 from the Respondent to the Applicant, copying in the Commission staff conciliator:
I have just received information that the contents of the attached agreement have been disclosed with a member of our staff.
The agreement specifically states that “The Applicant and the Respondent will not disclose the terms of this agreement to anyone other than”, the 3 points noted in the contract.
You were also advised by the Fair Work Councillor of the confidentiality of this agreement and that you were legally bound by it.
This has and will have a negative impact on this business as a result of this breech and therefore I am advising that settlement will not occur as legal advice is being saught.
Attached to this correspondence was the Terms of Settlement, signed and witnessed for both parties. I informed the parties that the existence of a binding agreement is a bar to a matter proceeding to arbitration as, where an agreement exists between the parties in settlement of a claim for unfair dismissal, the Commission does not have jurisdiction to hear the original application. On its face it appeared a binding settlement agreement did exist.
On the basis of the statement made by the Respondent it appeared the Respondent believed the Applicant had breached the confidentiality clause of the agreement. By this refusal to pay the money owed it may also be seen that the Respondent had sought to repudiate the agreement.
Subsequent to the mention I issued directions to the parties:
1. Mr Newell is required to advise my chambers by email to [email protected] by 4:00pm Thursday 10 February 2022 if he wishes his application for a remedy for unfair dismissal to proceed to determination in the Commission.
2. D & R Tarpaulins is required, by 4:00pm Thursday 24 February 2022, to do the following:
a. advise if it objects to the Commission arbitrating the unfair dismissal application.
b. If it does object to arbitration provide an outline of submissions as to why it says the Commission cannot or should not arbitrate the dispute.
c. If it considers the existence of the agreement is a bar to the Commission arbitrating the dispute.
d. How it considers the Commission should treat D & R Tarpaulins’ refusal to pay the settlement amount.
3. Upon receipt of submissions from D & R Tarpaulins I will determine what further submissions are required of Mr Newell.
Later that day the Applicant confirmed he wished to proceed with his application.
On 22 February 2022 the Respondent provided a submission by email:
We object to the Commission arbitrating the unfair dismissal application as a concluded agreement was reached with the applicant and the commission no longer has jurisdiction to hear a dispute relating to the concluded agreement. The application has been settled and cannot continue due to the concluded agreement.
Attached is a copy of the signed Deed which formulated the concluded agreement. The Applicant has breached clause 13, 14 and 15 of the Deed by disclosing the contents of the settlement to other employees and making disparaging remarks about us. Due to the Applicants breach we did not pay the settlement sum.
Should the applicant wish to pursue the settlement sum he must do so through a court and not the commission.
We look forward to your reply on if the Application is now marked settled and will not proceed or that the Applicants unfair dismissal application is allowed to proceed.
Following receipt of the submissions of the Respondent my chambers sent correspondence to the Applicant as follows:
The Commissioner has received brief submissions from the Respondent to your application to have your matter heard and determined by the Commission (see below). The Respondent also provided to the Commission a copy of the settlement agreement reached between the parties and signed by you and a representative of the Respondent. That signed agreement is attached.
In circumstances where an agreement has been reached between the parties the Commission does not have the ability to re-open the unfair dismissal application. This is because the agreement reached and signed by you resolves the unfair dismissal application. The dispute that now exists between you and the Respondent is in relation to the obligations the Respondent has under the agreement reached. This is a matter which can only be resolved in an appropriate court (the Commission is not a court for this purpose).
In a decision of the Federal Court (Australian Postal Corporation v Gorman [2011] FCA 975) it was said that an “accord and satisfaction” (i.e. an agreement) extinguishes the pre-existing cause of action (that is, the unfair dismissal application) such that the unfair dismissal application would have no reasonable prospect of success.
It is apparent, on the basis of the material filed by the Respondent, that a binding agreement has been reached between you and the Respondent. For this reason the Commissioner is considering dismissing your unfair dismissal application on the grounds that it has no reasonable prospect of success. It is not apparent how the Commissioner could conclude that a binding settlement agreement does not exist.
However, prior to the Commissioner making a final decision she is prepared to accept any submission you may wish to make. Such submissions should address the question of whether you agree a binding settlement agreement was reached between you and the Respondent.
Such submission is required to be filed with the Commission (by return email) and sent to the Respondent by 4.00pm Monday 28 February 2022.
On 23 February 2022 the Applicant advised the Commission by email that he would take this information into account and seek legal advice as soon as possible.
Ultimately no submission was provided by the Applicant by the due date and none has been provided at the time of issuing this decision.
Consideration
I now turn to whether the parties reached a binding agreement. If they have it is open to me to conclude that the application has no reasonable prospects of success.
In Singh v Sydney Trains (Singh)[1] the Full Bench of the Commission set out the legal principles relevant to the question of whether a binding settlement agreement as follows:
[45] The central issue in this appeal requires consideration of whether the Deputy President correctly applied legal principles relevant to the question of whether a binding settlement agreement had been reached between Mr Singh and Sydney Trains.
[46] Chief Justice Bathurst of the New South Wales Supreme Court explained the relevant principles concerning intention to create legal relations in the following way in Pavlovic v Universal Music Australia Pty Limited:[2]
“It is well established that the question of whether the parties intended to bind themselves to a contract is to be determined objectively, having regard to the intention disclosed by the language the parties have employed: Masters v Cameron [1954] HCA 72; 91 CLR 353 at 362. In cases such as the present, which do not depend on the construction of a single document, what is involved is the objective determination of the question from the communications between the parties in their context and the parties’ dealings over the time leading up to the making of the alleged contract. This involves consideration of the subject matter of the communications: Australian Broadcasting Corporation v XIVth Commonwealth Games Ltd (1988) 18 NSWLR 540 at 550. As was said by Mahoney JA and McHugh JA in Air Great Lakes Pty Ltd v KS Easter (Holdings) Pty Ltd (1985) 2 NSWLR 309, that includes consideration of what the parties said or wrote (at 334, 337).”
[47] The present case does not involve complexities which often arise where contractual intention is inferred from behaviour, or is imputed.[3] Whether there was a legally binding settlement reached between Mr Singh and Sydney Trains involves interpretation of the express written communications between the parties' solicitors.
[48] An offer and acceptance must precisely correspond…
The determination of the existence of an agreement is a matter of fact. Whether an agreement was made is to be discerned objectively considering the actions of the parties.[4] The terms agreed to at the conciliation on 2 December 2021 were sent to the parties on this date and signed and witnessed by the Applicant and Respondent respectively on 2 and 3 December 2021. Nothing suggests the parties did not intend to be immediately bound by the agreement. In any event, the terms of settlement were signed and witnessed shortly thereafter. The Full Bench in Singh continued:
[53] If parties who have been in negotiations reach agreement on terms of a contractual nature and also agree that those terms will be dealt with by subsequent formal documentation, there are several categories into which such negotiations fall.[5] First, the parties reach finality, intend to be immediately bound, and propose restatement of the terms of settlement in a fuller or more precise form but not different in effect. Secondly, the parties have completely agreed all terms but performance of one or more terms is conditional on execution of a formal document. Thirdly, the parties did not intend to make a concluded bargain at all, unless and until they execute a formal contract. Fourthly, the parties intended to be bound immediately and exclusively by agreed terms while expecting to make a further contract in substitution containing, by concept, additional terms.[6]
[54] When parties do reach an agreement of the first or fourth category referred to in Masters v Cameron and Baulkham Hills, they will be bound by the terms of their bargain, notwithstanding a later disagreement between the parties about the terms to be included in a deed or written agreement between them.[7]
The parties in this matter clearly reached an agreement of the first or second category in Masters v Cameron. In any event, the agreement reached does, as a matter of fact, exist.
It is clear to me that existence of a binding agreement extinguishes an unfair dismissal application in the Commission, the agreement is an answer to the claim. Its existence can determine that an application is frivolous or vexatious without reasonable prospects of success.
In Australia Postal Corporation v Gorman[8] Besanko J said:
31 An accord and satisfaction extinguishes any 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 subsequent litigation of the original claim: it is an
answer to the claim.
…
33 There is nothing in the [Fair Work] Act which suggests that an accord and
satisfaction should not be recognised…As I have said, an accord and satisfaction
extinguishes the pre-existing cause of action and continued pursuit of an application
based on such a cause of action is clearly capable of being considered frivolous or
vexatious or without reasonable prospects of success.
Section 587 of the FW Act provides that the Commission may dismiss an application:
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.
For the reasons given above I am satisfied that the application has no reasonable prospect of success as a binding agreement was reached by the parties in conciliation of the application. The application of the Respondent that the unfair dismissal application be dismissed is therefore granted.
The unfair dismissal application is dismissed and an order[9] to this effect will be issued in conjunction with this decision.
COMMISSIONER
[1] [2017] FWCFB 4562.
[2] [2015] NSWCA 313 (Pavlovic) at [15].
[3] See, for example, Brambles Holdings Limited v Bathurst City Council (2001) 53 NSWLR 153 (Brambles).
[4]Zoiti-Licastro v Australian Taxation Office [2006] AIRC 45 at [12]
[5] Masters v Cameron.
[6] Baulkham Hills Private Hospital Pty Ltd v G R Securities Pty Ltd (1986) 40 NSWLR 622 (Baulkham Hills).
[7] Zoiti-Licastro, [10]-[12]; Howe v Connell [1997] NSWSC 432.
[8] [2011] FCA 975.
[9] PR738872.
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