Sophia Ferry v Metro Resources

[2018] FWC 1157

[2018] FWC 1157

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Sophia Ferry
v
Metro Resources
(U2017/11940)

DEPUTY PRESIDENT CLANCY MELBOURNE, 2 MARCH 2018

Application for an unfair dismissal remedy- binding settlement reached – application dismissed

[1] On 9 November 2017, Ms Sophia Ferry made an application for a remedy for unfair dismissal under s.394 of the Fair Work Act 2009 (the Act).

[2] The matter then had an untidy and unnecessarily involved procedural history because during its case management, both parties were inconsistent and unresponsive in relation to the numerous requests for action and information made by the Commission.

[3] There was advice from Ms Ferry in early January 2018 that the matter had settled but following a request from the Commission for confirmation, the status of the settlement became unclear. In the meantime, Directions for the filing and service of the parties’ materials were made. They were not complied with by either side.

[4] Accordingly, a non-compliance hearing was held on 19 January 2018. Ms Ferry did not attend but at it, the Respondent advised the matter had settled. Because of her earlier equivocal position on settlement, confirmation was subsequently sought from Ms Ferry. She remained unresponsive and the Respondent and its representative were similarly tardy in response to requests for further information until the Respondent emailed the Commission on 24 January 2018, attaching what appeared to be counterpart terms of settlement documents signed by both parties and dated 17 January 2018.

[5] When the matter was allocated to my chambers, I caused correspondence to be sent to the parties. It enclosed the terms of settlement documents and advised that due to the apparent confirmation that a binding settlement agreement had been reached, I was considering whether I should dismiss Ms Ferry’s application under s.587 of the Act because it has no reasonable prospects of success. Ms Ferry was directed to file and serve submissions as to why her application should not be dismissed.

[6] As no material was received from Ms Ferry by the due date, I convened a telephone Mention hearing on 15 February 2018. At the Mention hearing, it was confirmed by the Respondent that both of the parties had signed terms of settlement on 17 January 2018 and that the settlement amount had been paid to Ms Ferry on 23 January 2018. Ms Ferry did not attend. She could not be contacted despite numerous attempts.

Consideration

[7] In Masters v Cameron 1, the High Court held that where parties who have been in negotiation 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 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 fuller or more precise but not different in effect.

2. It may be a case in which 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.

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] I am satisfied, based on the copies of the terms of settlement executed in counterpart, that the parties reached agreement by way of a binding settlement on 17 January 2018 and that the agreement was in the nature of the second type discussed in Masters v Cameron. The agreement was immediately binding and reflected in the terms of settlement document provided to the Commission by the Respondent on 24 January 2018. I am fortified by the advice from the Respondent that the settlement was paid to Ms Ferry on 23 January 2018.

[9] In Australia Postal Corporation v Gorman 2, Besanko J held that the existence of a binding settlement or “accord and satisfaction” extinguishes the existing cause of action and replaces it with a new cause of action based on the agreement.3

[10] His Honour stated:

“[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.” 4

[11] As can be seen from Australia Postal Corporation v Gorman, if there is a binding agreement between the parties, the Commission has the power to dismiss an application on the basis that it has no reasonable prospects of success.

[12] Section 587(1) of the 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.

[13] As I have found that the parties reached agreement by way of a binding settlement on 17 January 2018 and I am satisfied that the agreement was of the second type discussed in Masters v Cameron, I am persuaded that I should exercise my power under s.587(1)(c) of the Act to dismiss Ms Ferry’s application on the basis that it has no reasonable prospects of success. An order to this effect will be issued in conjunction with this decision.

DEPUTY PRESIDENT

<PR600656>

 1 (1954) 91 CLR 353 at [360]-[361].

 2 [2011] FCA 975.

 3 Ibid at [31].

 4 Ibid at [33].

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