Sorrenti v Lenovo (Aust & NZ) Pty Ltd (No 2)
[2022] FedCFamC2G 485
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Sorrenti v Lenovo (Aust & NZ) Pty Ltd (No 2) [2022] FedCFamC2G 485
File number(s): SYG 2317 of 2021 Judgment of: JUDGE HUMPHREYS Date of judgment: 21 June 2022 Catchwords: INDUSTRIAL LAW – Summary Dismissal – orders made for the matter to be disposed of by summary dismissal pursuant to 13.13(a) of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth) Legislation: Fair Work Act 2009
Federal Circuit and Family Court of Australia Act 2021 (Cth) s 143
Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth) r 13.13
Cases cited: Kassis v Republic of Lebanon [2014] FCCA 155
Masters v Cameron [1954] HCA 72
Morris v Baron and Company(1918) AC 1, 35
Sorrenti v Lenovo (Aust and NZ) Pty Ltd [2022] FedCFamC2G 256
Division: Division 2 General Federal Law Number of paragraphs: 36 Date of last submission/s: 8 June 2022 Date of hearing: 8 June 2022 Place: Sydney Counsel for the Applicant: Mr Banasik Counsel for the Respondent: Mr Mahendra ORDERS
SYG 2317 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: TANIA SORRENTI
Applicant
AND: LENOVO (AUST & NZ) PTY LTD
Respondent
ORDER MADE BY:
JUDGE HUMPHREYS
DATE OF ORDER:
21 JUNE 2022
THE COURT ORDERS THAT:
1.The application be dismissed pursuant to r 13.13(a) of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth).
Note: The form of the order is subject to the entry in the Court’s records.
Note: The Court may vary or set aside a judgment or order to remedy minor typographical or grammatical errors (r 17.05(2)(g) Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 17.05 Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth).
REASONS FOR JUDGMENT
JUDGE HUMPHREYS
INTRODUCTION
This matter has a somewhat unusual history. It is appropriate to set the history out in some detail. On 16 December, Ms Sorrenti (“the applicant”) made an Application to the Court under the Fair Work Act 2009 (Cth) (“the Act”), alleging a contravention of a general protection.
In the Points of Claim attached to the application, the applicant alleged bullying and harassment by members of staff of Lenovo (Aust & Nz) Pty Ltd (“the respondent”). The applicant alleges that on 15 December 2020, she lodged a complaint about bullying and harassment with the respondent’s Human Resources Department. The applicant contends that the complaint was investigated and found the applicant was ‘partly bullied”.
The applicant alleges that as a result of the complaint the respondent took adverse action against the applicant by (a) delegating the investigation to the respondent’s “World Wide Ethics and Compliance Team” who undertook the investigation from India and (b) failed to conduct the investigation under and according to Australian law.
It is further alleged that the respondent took further adverse action against the applicant in the form of directing the applicant to undertake fresh duties, which the respondent knew the applicant was incapable of properly performing.
The applicant alleges that further adverse action was taken against her on 21 July 2021 following the finding that she had been “partially bullied” in that the respondent’s Chief Operations Officer directed that the applicant’s complaint should be resolved in mediation, and if not then there would need to be a separation. The applicant understood this to mean dismissal.
The applicant then took her grievance to the Fair Work Commission. A conciliation conference was held on 19 August 2021. There is disagreement between the parties as to whether a final settlement was reached at that conciliation conference. The applicant subsequently refused to sign a Deed of Settlement prepared by the respondent’s solicitors.
INTERLOCUTORY ISSUES
In an additional application filed the same date, the applicant sought an interlocutory injunction that the respondent (its servants and agents, including Lander and Rogers solicitors) will not engage in any acts of a threatening nature, harassment, force, intimidation and the like, directed at the applicant. That matter was resolved by negotiation between the parties and certain concessions being made by the respondent in Court regarding any future communications with the applicant, were to be made from that point on through her Solicitor.
Another collateral but acrimonious dispute arose in respect of a claim by the respondents that they were entitled to the return of a computer, that belonged to them, that was in possession of the applicant. It was necessary for an interlocutory hearing to take place, with the Court making orders for the return of the computer subject to certain conditions regarding the identification and provision to the applicant of certain personal documents and files stored on the computer: (see; Sorrenti v Lenovo (Aust and NZ) Pty Ltd [2022] FedCFamC2G 256).
APPLICATION FOR SUMMARY DISMISSAL BY THE RESPONDENT
In their Response filed with the Court on 28 January 2022, the respondent first sought the return of the computer.
Second, the respondent sought an order that that the proceedings should be summarily dismissed under s 143(2) of the Federal Circuit and Family Court of Australia Act 2021 (Cth) (“the FCFCOA Act”) and/or r 13.13 of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth) (“the Rules”) on the basis that, a binding settlement had been reached between the parties at a conciliation conference held before Commissioner Ryan on 19 August 2021.
It was submitted that the current proceedings are in breach of that agreement. Further, the respondent has at all times complied with its obligations arising out of that agreement.
THE RESPONDENT’S SUBMISSIONS ON SUMMARY DISMISSAL
At the end of the conciliation conference held on 19 August 2021 before Commissioner Ryan, the following was said:
Commissioner Ryan: thank you Associate, in matter C2021/4405 Sorrenti and Lenovo (Australia and New Zealand) Pty Ltd trading as Lenovo. An application pursuant to section 372 of the Fair Work Act. The parties have today resolve the matter in the following terms:
•The respondent will make a payment, a gross payment of $59,134.61 to be characterised as an employment termination payment and to be paid within 28 days of the applicant providing an executed deed of release, providing a letter of resignation and withdrawing the current workers compensation claim, or the latter of any of those matters.
•The deed of release to provide for mutual releases for all matters other than workers compensation superannuation.
•The respondent provides a statement of service setting out the applicant’s period of employment, role and summary of duties, and the terms of settlement that have been agreed to are immediately binding in a Masters v Cameron (category two) sense, the deed of release prepared by the respondent’s representative.
Mr Goonrey, does that accurately reflect terms and conditions that the respondent has agreed to and agrees to be bound by?
Mr Goonrey: that is correct Commissioner.
(There was discussion concerning superannuation and a clawback provision)
Commissioner Ryan: thank you. Mr Gu (the applicant’s legal representative), does that reflect the agreement that your client has agreed to and agrees to be bound by?
Mr Gu: that’s correct Commissioner. Yes.
It was submitted that it was clear from the transcript of the recording that a binding settlement was reached. On 27 August 21, Mr Goonrey sent a proposed deed of release to the applicant’s then legal representatives.
Email exchanges took place between the various legal representatives of the parties until 26 October 2021. It was submitted, that at no stage during these exchanges did the applicant deny that a binding settlement had been reached the conciliation conference.
On 26 October 21, the applicant’s then representatives sent an email to Commissioner Ryan’s Chambers requesting a second conciliation conference on the basis that the applicant believed that the deed did not accurately reflect the recording of the settlement that had been reached at the conciliation conference of 19 August 2021 in terms of clawback provisions regarding the settlement payment. Again there was no denial that a binding settlement had been reached.
Due to what appears to have been a communication breakdown between the applicant’s representative and the Fair Work Commission registry, on 29 October 2021, Commissioner Ryan’s Associate asserted that a Notice of Discontinuance had been filed by the applicant on 12 August 2021.
On 10 November 2021, the applicant’s current solicitor, Mr Kurt Esser began acting for the applicant.
On 23 November 21, the respondent’s representatives sought to relist the matter before the Fair Work Commission. On 10 December 2021, the parties received a communication from Commissioner Ryan which stated as follows;
The matter before the Commission was a general protections application not involving dismissal pursuant to section 372 of the Fair Work Act 2009 (FW Act).
The matter was listed for the purposes of a conference pursuant to section 374 of the FW Act 19 August 21.
During the course of that conference, the parties reached a settlement of the matter which was offered, and accepted, on the basis that it was immediately binding as a Masters v Cameron Category contract.
On the basis that the parties have reached binding settlement, and that the commission has discharged its functions under Subdivision B of Division 8 of Part3-1 of the FW Act, I consider my role functus officio.
Accordingly, the matter will not be relisted.
I note the parties have sought and been provided with a recording of the binding settlement and on the basis it does seem rather curious that the matter is still in dispute. However, to the extent that the parties had not complied with their obligations pursuant to that settlement, it is a matter for a Court of competent jurisdiction.
The Court was referred to Masters v Cameron [1954] HCA 7 Masters v Cameron (“Masters v Cameron”) at [9]–[10] where the following was said:
Where parties who have been in negotiation reach agreement upon terms of a contractual nature and also agree that the matter of the negotiation shall be dealt with by a formal contract, the case may belong to any of three cases. It may be one in which the parties have reached finality in arranging all 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 the form which will be fuller or more precise but not differently in effect. Or, secondly, 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 they agreed terms express or implied, but nevertheless had made the performance of one or more terms conditional upon the execution of a formal document. Or, thirdly, the case may be one in which the attention of the parties is not to make a concluded bargain at all, unless and until they execute a formal contract (at p360)
in each of the first two cases there was a binding contract: in the first case a contract binding the parties at once to perform the agreed terms whether the contemplated formal document comes into existence or not, and to join (if they have so agreed) in settling and executing the formal document; and in the second case a contract binding the parties to join in bringing the formal contract into existence and then carry it into execution….. A case of the second class came before this court in Niesmann v Collingridge (1921) CLR 177 were all the essential terms of the contract had been agreed upon, and the only reference to the execution of a further document was in terms as to price, which stipulated that payment should be made “on the signing of the contract”. Rich and Starke JJ observed at pp 184, 185 that this did not make the signing of a contract a condition of agreement, but it made it a condition of the obligation to pay, and carried a necessary implication that each party would sign a contract in accordance with the terms of agreement.. Their Honours, agreeing with Knox CJ held that there was no difficulty in decreeing specific performance of the agreement, and “and so compelling the performance of a stipulation of the agreement necessary to its carrying out and due completion”.
It was submitted that it was clear from the transcript of the proceedings on 19 August 2021 before the Fair Work Commission that all essential terms of the bargain had been agreed. The execution of a deed of release was only a condition precedent to the respondent being required to pay the relevant sum to the applicant. The execution of the deed of release was not a condition of the agreement but rather (as referred to above) a condition of the obligation to pay.
The can be no doubt that a binding settlement within the scope of what is called a Category 2 Masters v Cameron agreement was reached. Accordingly, the applicant is unable to seek any further relief against the respondent in respect of the matter is now being agitated in the Court.
In the alternative, it was submitted that the points of claim relied upon by the applicant do not refer to or rely on any Federal legislation to ground the relief sought at [22] to [25]. Secondly, there is no Federal legislation that confers jurisdiction on the Federal Circuit and Family Court of Australia to deal with claims alleging bullying and harassment.
APPLICANT’S SUBMISSIONS ON SUMMARY DISMISSAL
On behalf of the applicant that if it was correct there was a Masters v Cameron Category 2 agreement (which the applicant does not admit), the respondent has misunderstood the legal consequences. A Category 2 agreement does not entitle a party to a performance of those terms that are conditional on the formal agreement being executed. It must first seek specific performance of the promise to enter into the formal agreement.
It was submitted that in the present case, all terms were conditional save the confidentiality and non-disparagement provisions. Those terms were the only unconditional terms by reason of the Commissioner having said:
The agreement was, as I indicated, a Masters v Cameron (category two) document, that means it’s immediately binding and for Ms Sorrenti, Mr Ruda and Mr Wilson that means the confidentiality provisions and non-disparagement provisions kick in now and are effective now, and you’re bound by them from now.
The respondent has not sought an order and the nature specific full performance to compel the applicant to execute a deed of release. The application is misconceived.
Secondly, there was an accord without satisfaction. The Court was referred to Morris v Baron and Company (1918) AC 1, 35 per Lord Atkinson (citations omitted):
There is no doubt that the general principle is that an accord without satisfaction has no legal effect, and that the original cause of action is not discharged as long as the satisfaction agreed-upon remains executed re-. That was decided so long as 1611…. If, however, it can be shown that what a creditor accepts in satisfaction is merely his debtor’s promise and not the performance of that promise, the original cause of action is discharged from the date when the promises made.
It was submitted that, for the respondent to succeed, it must satisfy the Court that the agreement should be construed to fall within the second category. This is properly an issue for trial. It was submitted that there was persuasive evidence that this was the first category. Firstly, it was not stated as part of Commissioner’s summation of the terms that the applicant accepted the promise of payment in satisfaction and it is submitted that Lord Atkinson’s “general principle” thereby applies. Secondly, the payment of the settlement sum was itself subject to various conditions precedent including the respondent preparing the deed. Thirdly, the Commissioner’s explanation of what terms were intended to be immediately binding excluded the releases.
In relation to the jurisdiction issue, the points of claim do not stand alone. It is an attachment to the form for headed “Claim under Fair Work Act 2009 alleging a contravention of a general protection”. Under Part G the Form states (inter ailia): “Specify the “adverse action” and “if relying on s 340 specify the workplace right”. At [8] and [9] of the points of claim, specifies the workplace right and that10], [13] and [16]-[17] pleads the adverse action (including the causative link). Bullying can be an adverse action: (see; Kassis v Republic of Lebanon [2014] FCCA 155 at [37]).
CONSIDERATION
The Court’s power to order Summary Judgement is set out in s 143 of the FCFCOAAct. Relevantly it is as follows:
(2) The Federal Circuit Court of Australia (Division 2) may give judgement for one party against another in relation to the whole or any part of the proceeding if:
(a) the first party is defending the proceeding or a part of the proceeding: and
(b) the Court is satisfied that the other party has no reasonable prospects of successfully prosecuting the proceeding or that part of the proceeding.
(3) For the purposes of this section, a defence or a part of a proceeding need not be:
(a) hopeless: or
(b) bound to fail:
for it to have a reasonable prospect of success.
Rule 13.13 of the Rules reads as follows:
The Court may order that a proceeding be stayed, or dismissed generally or in relation to any claim for relief in a proceeding, if the Court is satisfied that:
(a)The party prosecuting the proceeding or claim has no reasonable prospect of successfully prosecuting the proceeding or claim: or
(b)The proceeding or claim for relief is frivolous or vexatious; or
(c)The proceeding or claim for relief is an abuse of the process of the Court
Based on an assessment of the entirety of the transcript of the Fair Work hearing, as set out in the Affidavit of Mr Goonery sworn 26 January 2022, the Court is satisfied that a Masters v Cameron Category 2 agreement was reached during the course of the conciliation conference. That is clearly the understanding of Commissioner Ryan. The effect of that Category 2 agreement was that the parties reached a complete agreement as to the terms of settlement, with the payment agreed-upon to be subject to the execution of a Deed of Release to be prepared by the respondent’s solicitors.
For whatever reason, Ms Sorrenti has refused to sign the Deed of Release. Should she do so, then the respondents would be bound to make the payment that was agreed to her.
Notwithstanding that the agreement was in place, Ms Sorrenti sought to agitate in this Court, the same matters that were the subject of the conciliation conference. The Court is of the view that the agreement that was reached at the conciliation conference is binding upon the parties and accordingly, those matters cannot be re-agitated in this Court.
The suggestion by Counsel for Ms Sorrenti that in order to rely on the Masters v Cameron agreement it is the respondent who must first seek that specific performance is misconceived. It is not the respondent that has sought to repudiate the agreement. It was submitted, and the Court accepts, that the respondent has at all times has been willing to be bound by the agreement, subject to Ms Sorrenti signing the deed of release as she agreed to in the conciliation conference. That this was the situation, cannot be clearer than the answer that was given by the applicant’s legal representative Mr Gu to the question from Commissioner Ryan “… Does that reflect the agreement that your client has agreed to and agrees to be bound by? Mr Gu: That’s correct, Commissioner. Yes”.
In these circumstances, the Court is satisfied pursuant to s 143(2)(b) of the FCFCOA Act that the applicant, Ms Sorrenti, has no reasonable prospect of successfully prosecuting the proceeding and that the matter should be disposed of by summary dismissal pursuant to
r 13.13(a) of the Rules.
Having found the above, it is not necessary for the Court to consider the second claim by the respondent, that the Court does not have jurisdiction to hear the claim.
The Court will now hear the parties on the issue of costs, including whether or not, should be paid on either a scale, party-party or indemnity basis.
I certify that the preceding thirty-six (36) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Humphreys. Associate:
Dated: 21 June 2022
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