Toby Tucker v State of Victoria (State Revenue Office)
[2020] FWC 5252
•30 SEPTEMBER 2020
| [2020] FWC 5252 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.394—Unfair dismissal
Toby Tucker
v
State of Victoria (State Revenue Office)
(U2019/8416)
DEPUTY PRESIDENT YOUNG | MELBOURNE, 30 SEPTEMBER 2020 |
Application for an unfair dismissal remedy – applications to dismiss pursuant to section 399A(1)(c) and section 587(1)(c) of the Fair Work Act 2009.
Introduction
[1] This decision concerns an application by the State of Victoria (State Revenue Office) (SRO) that Mr Tucker’s application for an unfair dismissal remedy be dismissed pursuant to section 399A(1)(c) of the Fair Work Act 2009 (Act) or, alternatively, pursuant to section 587(1)(c) of the Act.
Background
[2] Mr Toby Tucker was formerly employed by the SRO.
[3] Mr Tucker’s employment with the SRO was terminated on 19 July 2019 for serious misconduct. On 30 July 2019 Mr Tucker made application for an unfair dismissal remedy in accordance with section 394 of the Act (proceeding U2019/8416) (Application).
[4] On 29 August 2019, the Commission issued directions for the filing of materials by the parties. At that time, Mr Tucker was self-represented. The SRO has at all material times been represented in the Application by Maddocks. Subject to the supervision of Mr Ross Jackson, Partner, Ms Alison Gallaher, Associate, has had carriage of the Application on behalf of the SRO. 1 Ms Gallaher has been assisted by Ms Courtney Ford, Lawyer.2
[5] On 3 October 2019 the SRO made application for confidentiality orders in relation to material filed by Mr Tucker in the Application. An interim confidentiality order was issued on 15 October 2019 (Confidentiality Order).
[6] On 22 October 2019 Mr Tucker made application for orders that the SRO produce certain documents (Production Application). A mention hearing was listed for 14 November 2019 in relation to the Production Application.
[7] The Application was listed for arbitration hearing on 20 and 21 November 2019.
[8] On 6 November 2019, by Form F53 Notice of Representative Commencing to Act, Patron Legal commenced representing Mr Tucker in the Application. 3
[9] On 8 November 2019 the parties participated in a member assisted conciliation, however, the Application was not settled. At the conciliation the SRO was represented by Maddocks and Mr Tucker was represented by Patron Legal.
[10] On 13 November 2019, Mr Francis of Patron Legal wrote to the Commission in the following terms:
“Dear Associate
I refer to tomorrow’s telephone mention before the Deputy President.
The parties have today progressed negotiations and have reached an in-principle settlement of this matter, pending execution of a deed.
In the circumstances, the parties respectfully request that tomorrow’s telephone mention be vacated.
Please do not hesitate to contact me if you have any queries.”
(Francis Email)
[11] Accordingly, the mention hearing in relation to the Production Application and the subsequent arbitration hearing was vacated and a notice of listing confirming this was sent to the parties on 15 November 2019.
[12] The SRO submits that a binding settlement agreement was reached between the parties on 13 November 2019. 4
[13] It is uncontested that Mr Tucker has not executed a deed of settlement in relation to the Application, has not filed a notice of discontinuance nor have any settlement monies been paid to him.
[14] By application dated 10 June 2020 the SRO seeks that the Application be dismissed pursuant to section 399A(1)(c) on the basis that Mr Tucker has unreasonably failed to discontinue the Application after a settlement agreement has been concluded. In the alternative, the SRO seeks that the Application be dismissed pursuant to section 587(1)(c) of the Act on the basis that the parties reached an agreement to settle the Application and, consequently, the Application has no reasonable prospects of success 5 (Dismissal Application).
[15] Mr Tucker opposes the Dismissal Application and contends that no binding settlement agreement has been reached between the parties.
Hearing and witnesses
[16] On 11 June 2020 I issued directions for the filing of material in relation to the Dismissal Application. The SRO filed its materials on 25 July 2020, Mr Tucker filed material in reply on 9 July 2020, and the SRO filed further material in reply on 16 July 2020.
[17] On 5 August 2020 I conducted a hearing in relation to the Dismissal Application. Pursuant to section 596 of the Act, Mr Johnathon Forbes appeared on behalf of the SRO. Mr Tucker appeared and gave evidence on his own behalf. Ms Alison Gallaher and Ms Courtney Ford gave evidence on behalf of the SRO.
Dismissal Application
[18] For the reasons that follow, I find that a binding settlement agreement was reached between the parties on 13 November 2019. On that basis, I find that the Application has no reasonable prospects of success. The Application is dismissed pursuant to section 587(1)(c) of the Act.
Negotiations to settle the Application
[19] Matters arising from Mr Tucker’s dismissal have a lengthy history and it is not presently necessary to traverse all of those matters. Insofar as the Application is concerned, the relevant background is as follows.
[20] On 12 November 2019 Mr Francis of Patron Legal wrote to Maddocks. That letter was marked “Without prejudice save as to costs” and was in the following terms:
“In light of the fact that the matter is listed for hearing next week, our client wishes to propose a final attempt to settle this matter before the parties commence preparation in earnest.
We note that your client, even if it succeeds in defending Mr Tucker’s claim, is unlikely to be able to recover its costs of the UD Proceeding. Those costs are likely to be substantial.
Further, it is our view that the interests of each of the parties are not going to be advanced by the public ventilation of the factual matters that form the basis of the dispute.
To that end, and to save the parties the time and expense of continuing the UD Proceeding, our client is prepared to settle the UD Proceeding on the basis that your client pays to him the sum of $[redacted]. This settlement will be on a no-admissions and confidential basis.
This offer to settle the UD Proceeding is open until 5:00 pm tomorrow Wednesday 13
November 2019.
If you wish to discuss this matter please do not hesitate to contact our firm.” 6
(12 November Letter)
[21] On 13 November 2019 at 5.03 pm Maddocks wrote to Patron Legal. That letter was marked “Without prejudice save as to costs” and was in the following terms:
“We refer to your letter dated 12 November 2019 and your client’s offer to settle the Proceeding set out in that correspondence (Offer).
Subject to your client’s agreement to execute of a deed of release in relation to the settlement of the Proceeding, the terms of the Offer are accepted in principle by the State.
Save for formalities, the deed of release (to be drafted by us) will record the following terms:
1. That the State will pay Mr Tucker (or as directed by him) the sum of $[redacted] (less any taxation which must be withheld by law);
2. That the payment of the settlement sum is made with an express denial of liability by the State and may not be relied upon by the Applicant as any admission of liability by the State;
3. The settlement, the terms of settlement and all correspondence and communications leading to or relating to the settlement shall remain confidential to the parties and cannot be disclosed or communicated to any other person other than with the written consent of the other party or as required by law; and
4. Subject to the payment of the settlement sum, the parties will consent to an order that the unfair dismissal proceeding be dismissed with no right of reinstatement.
We look forward to your prompt response regarding the above.” 7
(13 November Letter)
[22] The 13 November Letter was forwarded to Mr Tucker by Mr Francis at 5.04 pm. 8
[23] Ms Ford’s evidence is that at 5.12 pm that day she received a telephone call from Mr Francis (Telephone Conversation). Her evidence is that in the Telephone Conversation Mr Francis confirmed that he had received the 13 November Letter and that the terms of settlement set out in that letter were accepted by Mr Tucker. Under cross examination she said:
“So, on 13 November I sent an email attaching an emailed letter, 5.03 pm, that was with the approval of Mr Jackson and that was sent to Mr Francis. Then I received a phone call approximately 10 minutes later from Mr Francis and we had a conversation. Mr Francis said to me I've received your letter in the email, we accept the terms of settlement and now that we're agreed I propose writing to the Commission and informing of that and with your client's approval asking that the mention hearing tomorrow morning be vacated….” 9
[24] Her evidence is that Mr Francis then said he would write to the Commission advising that the parties had reached in principle agreement and, with the consent of the SRO, seek that the mention hearing listed for the following day be vacated. Ms Ford says that she told Mr Francis she would seek instructions regarding vacation of the mention and that Maddocks would send a draft deed of release on the terms set out in the letter as soon as possible. 10 Ms Ford says she then sought instructions from Ms Drakeford11 to seek the mention be vacated and communicated these instructions to Mr Francis by telephone.12
[25] Mr Tucker’s evidence does not address the Telephone Conversation. Accordingly, he does not adduce any evidence which directly contests the Telephone Conversation or its contents. Rather, he submits that Ms Ford’s evidence constitutes inadmissible hearsay and irrelevant evidence not corroborated by any contemporaneous documentation or evidence from Mr Francis. 13 In oral submissions Mr Tucker submitted that Ms Ford’s “subjective” evidence regarding the Telephone Conversation ought be given “zero to minimal weight”.14 Under cross examination Ms Ford conceded that she would have made a file note of the Telephone Conversation,15 the call would be recorded on a telephone log16 and that the Telephone Conversation would, in the ordinary course, be billable and would therefore be itemised on an invoice.17 Ms Ford’s explanation for the failure to produce any of these documents in her evidence was that they were subject to legal professional privilege.18 In oral submissions Mr Tucker submitted that I ought infer from the absence of any of these documents being produced by Ms Ford that the Telephone Conversation did not occur.19 I reject those submissions. Firstly, Ms Ford gave clear and consistent evidence. I consider she was a credible witness. Secondly, Ms Ford gave direct evidence of a conversation to which she was a party. It is not hearsay evidence. Thirdly, Ms Ford’s evidence is unquestionably relevant. The SRO submits that it was in this conversation that a binding settlement agreement was reached. Fourthly, whilst I consider it would have been prudent for the SRO to have waived privilege and produced the file note of the Telephone Conversation, and in light of the matters disclosed in Ms Ford’s evidence find the rationale for not doing so curious, I would require considerably more before I was prepared to infer that Ms Ford, a legal practitioner, gave false evidence under oath to the Commission. Fifthly, Ms Ford’s evidence as to the Telephone Conversation was not challenged in cross examination. Sixthly, it is clear that it was for Mr Tucker to call Mr Francis. No criticism can be made of the SRO for not doing so. Mr Tucker did not call Mr Francis to give evidence to dispute Ms Ford’s evidence of the Telephone Conversation or its contents. Finally, I consider Ms Ford’s evidence is consistent with the Francis Email subsequently being sent at 5.32 pm. Mr Tucker contends that the Francis Email is wholly inconsistent with and contrary to Ms Ford’s evidence.20 I address this contention below in the context of the Francis Email. Accordingly, I accept Ms Ford’s evidence. I therefore find the Telephone Conversation occurred and that its content was as attested to by Ms Ford.
[26] At 5.32 pm that day Mr Francis sent the Francis Email to the Commission seeking to vacate the mention hearing listed for the following morning.
[27] Ms Ford’s evidence is that at approximately 11.15 am on 14 November 2019 she returned a telephone call from Mr Francis. She says that Mr Francis had two queries in relation to the terms of the deed to be prepared. The first was whether the SRO would pay the settlement sum to Mr Tucker without deduction of taxation and the second was whether it was necessary to include a term that the Application be dismissed by consent with no right of reinstatement, as opposed to Mr Tucker filing a notice of discontinuance. Ms Ford’s evidence was that she told Mr Francis she doubted that the settlement sum could be paid without deduction of taxation, but she would seek instructions. In relation to the second query, she says that she told Mr Francis that dismissal by consent order was a necessary term and that Mr Tucker had agreed to this on 13 November 2019. She says that she suggested that Mr Francis contact Ms Gallaher regarding the queries, should he wish to do so. 21 That evidence was not challenged, and I accept it.
[28] Ms Gallaher’s evidence is that Mr Francis telephoned her on 14 November 2019, following his conversation with Ms Ford. She says that during that telephone conversation Mr Francis advised her that Mr Tucker would prefer to file a notice of discontinuance, wanted the settlement sum paid to Patron Legal’s trust account and wanted the settlement sum to be paid without deduction of tax, with Mr Tucker to assume any liability for taxation. 22 Ms Gallaher says that she confirmed that the SRO required the matter be dismissed by consent order as agreed and that she would seek instructions on the other two matters and incorporate them into the draft deed to the extent that they were acceptable to the SRO.23 That evidence was not challenged and I accept it.
[29] On 15 November 2019 Maddocks forwarded a deed of release (Deed) to Patron Legal under cover of an email in the following terms:
“We refer to our correspondence of 13 November 2019 and to our discussions yesterday.
Please find attached for your client’s consideration, a draft deed of release.” 24
[30] The Deed relevantly provided that:
• within two days of execution, Mr Tucker must execute and provide to Maddocks consent orders (in the form attached to the Deed) for execution by the SRO and filing in the Commission (clause 1 of the Deed); and
• payment of the settlement sum would be made within 7 days of the Commission making orders dismissing the Application (clause 3.1 of the Deed). 25
[31] On 20 November 2019, under cover of email, Mr Francis returned the Deed to Maddocks marked up with proposed amendments. The key amendments sought by Mr Tucker were:
• clause 1 of the Deed be amended to require Mr Tucker to file a notice of discontinuance in the Commission within two days of executing the Deed;
• clause 3.1 of the Deed be amended such that the settlement sum was paid as an ex-gratia payment within seven days of discontinuance of the Application;
• inclusion of new clause 3.5 providing that Mr Tucker would be liable for any taxation which might be payable on the settlement sum; and
• inclusion of new clause 4.5 providing that the confidentiality provisions of the Deed, which included a requirement that all aspects of the Deed, including its existence, be kept confidential, did not prevent the parties from disclosing that the Application was discontinued as part of a settlement agreement. 26
[32] Other minor amendments to the Background section of the Deed were also sought. 27
[33] On 21 November 2019 Maddocks wrote to Mr Francis. That letter was marked “Without prejudice save as to cost” and enclosed a revised deed to the limited extent that the amendments sought by Mr Tucker were agreeable to the SRO. The SRO did not agree to the amendments sought to clause 1 or 3, nor to the inclusion of new clause 4.5 but accepted the other minor amendments to the Background section of the Deed. 28
[34] On 21 November 2019 Mr Francis again wrote to Maddocks. That letter is marked “Without prejudice save as to costs”. In the letter of 21 November 2019 Mr Francis states that Mr Tucker does not consent to executing orders dismissing the Application, seeks confirmation of the net sum which would be paid following deduction of taxation from the settlement sum and that Mr Tucker is agreeable to a term that the settlement, as well as the fact of the deed, be kept confidential but seeks further information as to why the SRO seeks that the parties not be able to say that the matter has settled. 29
[35] On 26 November 2019 Maddocks responded to Mr Francis. That letter is marked “Without prejudice save as to costs”. That letter was in the following terms:
“We refer to your email below and are instructed to respond as follows:
1. Regarding the proposed consent orders, the State considers it appropriate that the deed provide for dismissal of the proceeding by consent. The State’s original acceptance of your client’s offer on 13 November 2019 provided for this, and the deed should reflect what the parties agreed. Orders dismissing the proceeding provides the State some additional reassurance that your client will not seek to reinstate the proceeding. Additionally, the form for discontinuance (F50) includes a checkbox that signifies the proceeding is discontinued “as part of a settlement agreement”. Given the State’s position on confidentiality regarding the existence of a settlement (set out below), a court document stating the parties have settled should be avoided. Other than your client’s view of it not being the usual course, does your client have any substantive concern with the proposed consent orders?
2. We will seek instructions regarding the nett amount to be paid.
3. Regarding confidentiality, both your client’s offer and our client’s acceptance was explicitly subject to confidentiality, and the State’s acceptance made it clear that such confidentiality included the existence of the settlement. Our client considers it important that the existence of the settlement is confidential, including to avoid any possibility of misrepresentation surrounding the circumstances of settlement. This is particularly important given the numerous other proceedings between the parties.
We look forward to your response.” 30
[36] On 12 December 2019 Mr Tucker wrote to the Commission and made application to have the confidentiality orders made by Commissioner Bissett in the Application set aside (Set Aside Application). In that correspondence Mr Tucker said:
“I am the applicant in this proceeding, which is stayed pending the parties 'in principle agreement' which remains subject of a proposed deed.” 31
[37] On 13 December 2019 Mr Francis wrote to Maddocks (Global Settlement Letter). That letter is marked “Without prejudice save as to costs” and sets out a proposal for a global settlement of all outstanding litigation between the parties, including the Application (Proposed Global Settlement). It is common ground that there were, and still are, a number of other proceedings between the parties in the Fair Work Commission and other courts and tribunals. That letter included the following statement:
“We note that as at today’s date there are four proceedings remaining on foot – the UD Proceeding, the Classification Proceeding, the Appeal Proceeding and the SC Proceeding. Only the SC Proceeding has been heard.” 32
[38] The reference in the Global Settlement Letter to the “UD Proceeding” is a reference to the Application. This correspondence (and other without prejudice correspondence between the parties relating to the proposed settlement of other proceedings) is annexed to Mr Tucker’s witness statement. The SRO objected to the inclusion in Mr Tucker’s materials of these without prejudice correspondences 33 but ultimately did not oppose my receiving Mr Tucker’s witness statement into evidence.34
[39] Ms Gallaher’s evidence is that on 16 December 2019 she and Mr Jackson had a telephone conversation with Mr Francis in relation the Proposed Global Settlement. Ms Gallaher’s evidence is that in that conversation Mr Jackson said that if a global settlement could not be agreed, the Deed should be executed as agreed. 35 That evidence was not challenged, and I accept it.
[40] On 17 December 2019 Maddocks responded to Mr Tucker’s email regarding the Set Aside Application. That correspondence stated, “this matter has been settled.” 36
[41] On 23 December 2019 Maddocks responded to the Global Settlement Letter. That response is marked “Without prejudice” and, amongst other things, rejected the Proposed Global Settlement made by Mr Tucker. It sets out certain requirements of the SRO in order for it to consider a global resolution of all matters and included the following statement:
“If your client wishes to propose such a settlement, then the State will be happy to progress negotiations. If he does not, then we expect your client to promptly execute the deed of release already provided that evidences the terms of settlement agreed between the parties in the unfair dismissal proceeding before the Fair Work Commission.” 37
[42] Ms Gallaher’s evidence is that on 21 January 2020 Maddocks wrote to Mr Francis on a without prejudice basis referring to Maddocks’ correspondence of 23 December 2019 and asked for Mr Tucker’s response by 28 January 2020. Ms Gallaher’s evidence is that that correspondence stated that if Mr Tucker was not willing to negotiate a global resolution within parameters acceptable to the SRO:
“your client should execute the deed of release already provided in the Fair Work Commission unfair dismissal proceeding, which records the binding agreement reached, without further delay.” 38
[43] That evidence was not challenged, and I accept it.
[44] Maddocks received no response from Mr Francis. 39
[45] Patron Legal ceased acting for Mr Tucker in the Application on 31 January 2020, by filing a Form F54 – Notice that lawyer or paid agent has ceased to act for a person. 40
Recent discussions
[46] Ms Gallaher’s evidence is that on 3 January 2020, Commissioner Bissett’s chambers wrote to Mr Tucker in relation toproceeding C2017/3152 (Pay Progression Dispute). Ms Gallaher says that correspondencestated that:
“In particular the Commissioner is aware that your unfair dismissal applicationhas been resolved (not by decision of the Commission).”
[47] Ms Gallaher says that Mr Tucker’s response to theCommission on 5 January 2020 addressed the status of proceedings between the parties in the Supreme Court of Victoria but did not dispute that the Application had been resolved. 41 That evidence was not challenged, and I accept it.
[48] On 13 February 2020, a mention hearing took place before me in relation to the Set Aside Application. The following exchange occurred between the Commission and the parties:
THE DEPUTY PRESIDENT: All right parties, the purpose of this mention is really to determine how we move forward. Mr Tucker, as I understand the position, some orders were made by Commissioner Bissett on 15 October in relation to confidentiality and access for certain materials filed in your unfair dismissal application.
MR TUCKER: Yes.
THE DEPUTY PRESIDENT: Then on the 13 November, last year, your representative indicated, well advised the Commission that the matter had been in-principally agreed and that was confirmed by the respondent on 12 December, so almost a month later - 17 December, I apologise, where the respondent advised that the matter was settled. In the intervening period on the 12th, you've made an application to have Commissioner Bissett's order set aside. So, what is the status of the in principle agreement that was reached in November?
MR TUCKER: The parties - I mean, I'm not too sure how much I can disclose, but we're still fighting about the mechanism, the deed.
THE DEPUTY PRESIDENT: Right.
MR TUCKER: So, there was a settlement in-principle and I thought it was a very straight-forward, simple settlement, one that I would assume would happen on a weekly basis before the Commission. However, when the deed has come through from the State Revenue Office, there's been what I consider outrageous bells and whistles added on, which I'm not agreeing to. So, I can't really say much more than that, but that's - - -
THE DEPUTY PRESIDENT: You don't need to say more than that, Mr Tucker, that's fine.
MR TUCKER: Yes.
THE DEPUTY PRESIDENT: Mr Forbes, does that reflect the respondent's view of where things are at, that the deed has not been finalised?
MR FORBES: That's - my understanding is that there's sticking points in the deed and that's a matter being dealt with between the parties. 42
[49] On 5 March 2020, Mr Tucker filed his material in support of the Set Aside Application. In his submissions, at paragraph [11] Mr Tucker said the following:
“However, the proceeding had settled in principle. Notwithstanding, the applicant has not filed a Notice of Discontinuance due to a dispute regarding the execution of the settlement as proposed. In this regard, the applicant expressly reserves his right to request that the matter be relisted for hearing and determination should the proposed settlement not be executed as agreed.” 43
[50] On 19 March 2020 Maddocks wrote to Mr Tucker regarding the Set Aside Application. That correspondence was marked “Without prejudice” and included the following:
“The documents filed by you in the proceeding were prepared for the purpose of advancing your claim. Similarly, each document filed in the Proceeding by the State was prepared solely for the purpose of answering the unfair dismissal claim. It is inappropriate to use such material for other purposes, particularly when objections to the evidence have been made by both parties, the Commission is yet to determine those objections and none of the filed witness statements have been read into evidence.” 44
[51] On 24 March 2020, Mr Tucker wrote to Maddocks and re-put the Proposed Global Settlement. 45 That offer was again rejected by the SRO, identifying that it had been rejected by the SRO on 23 December 2019 and again on 20 February 2020.46
[52] On 26 March 2020, the State filed its material opposing the Set Aside Application.
The SRO’s submissions included the following:
“24. Shortly prior to the hearing and following negotiation between the parties’ legal representatives, the unfair dismissal claim was settled in principle. The hearing dates were vacated by consent and the matter was adjourned indefinitely, although the proceeding has not yet been dismissed or discontinued.
…
71. At the time the matter was settled in principle between Mr Tucker and the SRO, the 15 October 2019 orders were in place and no application had been made to set them aside. The existence of the orders was part of the factual background against which the settlement was reached.” 47
[53] On 29 April 2020, a hearing took place before the Commission in relation to the Pay Progression Dispute. The following exchange occurred:
THE COMMISSIONER: Mr Tucker, what do I do - what then is the situation given that you have an unfair - well you settled an unfair – I understand that you've settled an unfair dismissal application that would have tested whether you had engaged in misconduct or not, and the Supreme Court has made findings with respect to the issue. What does it all mean if I then come up with a different finding? That's surely not a particularly good thing to have. What does that mean then?
MR TUCKER: Well the Commission will have to make, in my submission, will have to make direct findings as to whether these allegations are - - -
THE COMMISSIONER: Well I understand that you say I have to make a direct finding. What I'm asking you for is what are the implications if I make findings contrary to what everyone else has found?
MR TUCKER: Well no one's made findings on anything about the actual credibility of these allegations. Now if you want to go look at - - -
THE COMMISSIONER: Well findings have been made, Mr Tucker. You might not agree with them but findings were made in investigations as to your conduct. I understand you don't agree with it, that's fine but what happens if I find that the misconduct didn't occur? What does that then mean for all of the other proceedings that have been going on for three years?
MR TUCKER: Well for starters - well I would be successful in this proceeding. As for the application for unfair dismissal well that's settled in principle for the time being and I expressly reserve my right to reinstate that, I'm still fighting about the execution of that settlement believe it or not. But it'll have no - - -
…
THE COMMISSIONER: Well none of that evidence has been subject to any testing, Mr Tucker. They've filed statements.
MR TUCKER: Well that's correct, just like I haven't been allowed to test or apparently haven't been allowed to test the credibility of those allegations, so yes, I accept that point.
THE COMMISSIONER: Well you could have tested the credibility of the allegations.
MR TUCKER: I could have in this proceeding?
THE COMMISSIONER: No, in the unfair dismissal proceedings.
MR TUCKER: Well the SRO was desperate to settle that proceeding and now we know why.
THE COMMISSIONER: Well we don't know why. I understand that you say we know why but I don't accept that we know why.
MR TUCKER: Yes, thank you, Commissioner, I do apologise but the inference was clear.
…
MR FORBES: The unfair dismissal proceeding was also another avenue by which these particular issues could have been prosecuted. Mr Tucker and the SRO have settled that matter. No inference can be drawn from the fact of the settlement and the Commission shouldn't do so and should reject whatever (indistinct) Mr Tucker (indistinct). But what the case does, what (indistinct) that case does is that (indistinct) estoppel. He had (indistinct) and what comes with a settlement of a proceeding involving those issues is that he is now estopped, in my submission, from reagitating
those matters - - - 48
[54] Ms Gallaher’s evidence is that on 11 May 2020, the SRO wrote to Commission in relation to the Pay Progression Dispute. That correspondence said:
“In his unfair dismissal claim, Mr Tucker had the opportunity to challenge both the investigative process, and the merits of the allegations and findings, if he wished to. Instead, Mr Tucker chose to agree to settle that proceeding, thereby leaving the findings made by the SRO undisturbed.”
[55] Ms Gallaher says that Mr Tucker’s response to this correspondence did not dispute that the unfair dismissal matter was settled. 49 That evidence was not challenged, and I accept it.
[56] On 5 June 2020, Mr Tucker wrote to the Commission in relation to the Application stating that he:
“wished to press his two Form F52 Application for Orders to Produce filed and served on 29 August 2019. The hearing of the Form F52s was postponed on 14 November 2019, due to settlement negotiations that were ongoing at the time.” 50
[57] On 5 June 2020 Maddocks wrote to the Commission in relation to the Application stating:
“…the requests for production of documents were filed by the Applicant in relation to the unfair dismissal proceeding. The unfair dismissal proceeding has been settled, pending execution of a deed of release by the Applicant.
The Respondent submits that it is inappropriate for the requests for production of documents to proceed, in circumstances where the substantive matter to which they relate has been settled.
…” 51
[58] Later that day, during a telephone mention Mr Forbes, counsel for the SRO said:
“Yes. What we say, your Honour, is that there is a binding settlement agreement but the matter has not yet been dismissed.” 52
[59] At the same mention, Mr Tucker said:
“I do want to clarify for the record of course there is no binding settlement agreement.” 53
[60] On 9 June 2020 Mr Tucker sent two pieces of correspondence to Maddocks. In the first, amongst other things, Mr Tucker states:
“…
As you would be aware, no settlement has been agreed between the parties.
…
As you are acutely aware, there is no concluded settlement agreement in the matter noting:
1. On 12 November 2019, I prosed to resolve this matter if the SRO paid me a sum of money.
2. On 13 November 2019, the SRO responded with new terms including that the SRO would pay me less money than I proposed and that I was required to sign a deed;
3. The SRO subsequently presented a deed for execution, which contained a number of non-standard and unreasonable terms, all of which have been rejected. The deed contained a requirement that consent orders be signed dismissing the application, which is incorrect as a matter of fact and at law, and an unduly onerous confidentiality clause that the SRO intends would go so far as to prevent the parties disclosing the fact that this proceeding “had settled”.
4. The SRO has not paid me any monies in relation to this matter.
5. No settlement deed has been executed in this matter.
…” 54
[61] The second correspondence of 9 June 2020 was marked “Without prejudice save as to costs”. In that correspondence Mr Tucker makes on offer to settle the Application and the Pay Progression Dispute on certain terms and states, relevantly:
“In making this Offer, I note:
…
• all previous offers between the parties, which have expired, are revoked and withdrawn for the avoidance of doubt.
…” 55
[62] On 10 June 2019 Maddocks wrote to Mr Tucker by email. That email was marked “Without prejudice save as to costs” and was in the following terms:
“Dear Mr Tucker
Without prejudice save as to costs
We confirm the State considers the unfair dismissal proceeding has been settled, on a binding and enforceable basis.
As per the State’s application filed and served this afternoon, the State presses its application to have the proceeding dismissed on the basis that an agreement has been reached. That application will be unnecessary if you sign and return the deed of release, which captured the terms agreed by the parties as evidenced by the correspondence passing between them.” 56
Legal Principles
[63] The legal principles in relation to offer and acceptance of a settlement proposal and whether a binding settlement agreement has been made were set out by the Full Bench in Singh v Sydney Trains 57 and I respectfully adopt those below.
[64] 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 58:
“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).”
[65] An offer and acceptance must precisely correspond. The following principles are
relevant to this requirement:
• An acceptance corresponds to an offer if it is an unequivocal acceptance of the terms offered; 59
• An acceptance is not an unequivocal acceptance of the terms offered if it deviates from the offer, even if that deviation is not material or important;
• However, as a qualification to this principle, if a new term is included in a purported acceptance of an offer and the new term is solely for the benefit of the offeror, then this can constitute a valid acceptance; 60
• An acceptance will be effective if it does not depart from the terms of the offer, but simply repeats in the offeree’s own words the effect of the offer; 61
• Acceptance will be effective if it sets out expressly what would be implied by law in the absence of express agreement. 62 For example, an offer may contemplate that, were it to be accepted, a document would be prepared to record its terms. In proposing that a deed be prepared as part of an acceptance of such an offer, the offeree would be stating that which would be implied by law arising from the terms of the offer, namely, that it would be documented in some formal manner;63
• Similarly, if a purported acceptance of an offer merely includes the “machinery of working out what was meant by the offer, it is on the same plight as a request for information”. 64 Such a request for information does not revoke the offer and may constitute acceptance of the offer.
[66] Ultimately the question is whether a “reasonable recipient of the acceptance would
have regarded it as corresponding to the offer or whether they would have taken the acceptance to be qualifying the original offer such that it would amount to a counter-offer or, at any rate, not an unconditional acceptance of what was originally offered.” 65 Put another way, the language used by the offeree in their acceptance of the offer must be such as would convey to a reasonable person in the position of the offeror a clear and definite decision by the offeree to be bound by the terms of the offer, leaving nothing further to be negotiated.66
[67] A purported acceptance which does not correspond to the offer does not necessarily reject the first offer; it is, nevertheless, a counter-offer capable of acceptance. 67 A counter-offer accepted by the original offeror creates a binding agreement.68
[68] Conduct of the parties after the making of the supposed agreement is relevant. Such conduct may be considered in order to determine whether the prior dealings between the
parties gave rise to a binding contract. 69
[69] The phrase “in principle” agreement or similar is often used when negotiating the settlement of litigation and generally indicates that there is no intention yet to enter into a binding contract. 70 However, such words must be construed in the context in which they appear and the commercial setting in which the parties were operating.71 In each case, “much will depend upon the individual circumstances of each case as to whether those words demonstrate that the parties had or had not reached a consensus on the essential terms of their bargain and whether they intended to be immediately bound by them.”72
[70] In Masters v Cameron, 73 the High Court held that when parties who have been in negotiations reach agreement on terms of a contractual nature and agree that those terms will be dealt with by subsequent formal documentation, the case may belong to any of the following three classes:74
1. the parties reach finality and intend to be immediately bound but propose restatement of the terms of settlement in a fuller or more precise form but not different in effect; or
2. the parties have completely agreed all terms but performance of one or more terms is conditional on execution of a formal document; or
3. the parties did not intend to make a concluded bargain at all, unless and until they execute a formal contract.
[71] The High Court held that in each of the first two classes there is a binding agreement. In the first case a contract binding the parties at once to perform the agreed terms whether the contemplated formal documentation comes into existence or not, and to join (if they 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 to carry it into execution. 75
[72] A fourth class was recognised by McLellan J of the NSW Court of Appeal in Baulkham Hills Private Hospital Pty Ltd v G R Securities Pty Ltd, 76 being one in which 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.77
[73] When parties reach an agreement of the first, second or fourth classes 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. 78
Submissions
[74] The SRO submits that a binding agreement was made on 13 November 2019 between it and Mr Tucker when Mr Francis informed Ms Ford that the offer set out in the 13 November Letter was accepted. 79 The SRO submits that the 13 November Letter was a conditional acceptance of the offer that had been put by Mr Tucker on 12 November 201980 or alternatively, a counter-offer capable of acceptance by Mr Tucker.81 The SRO submits that an agreement was unquestionably made when Mr Tucker accepted the counter-offer.82 It submits that the acceptance was unambiguous83 and that there was a direct and complete correspondence between what was offered and what was accepted.84 It submits that the agreement was of a contractual nature, bearing all of the essential elements of an intention to enter a contractual relationship, an offer, acceptance and consideration.85
[75] The SRO submits that the agreement made between the SRO and Mr Tucker on 13 November 2019 falls comfortably into either the first or second classes as set out in Masters v Cameron. 86 The SRO submits that the agreement reached was on the terms of the 13 November Letter. It says that what was left to be performed was the preparation of a deed of release which would include formalities and record the terms of that letter, but in a form which will be fuller or more precise but not different in effect (class 1 in Masters v Cameron).87Alternatively, it says that the agreement made was one where the performance of certain terms (payment of the settlement sum and dismissal of the proceedings by consent) was conditional upon the execution of a formal document (class 2 in Masters v Cameron).88
[76] Mr Tucker submits that no binding agreement was made on 13 November 2019 and relies on the following matters:
• The SRO expressly said on 13 November 2019 that its acceptance of the 12 November Offer was conditional on Mr Tucker’s agreement to execute a deed;
• Mr Tucker declined to execute a deed;
• The Francis Email requested vacation of the mention hearing as negotiations had “progressed” and the parties had reached in principle agreement “pending the execution of a deed”; and
• There is still “uncertainty and heated dispute” as to the essential terms of the proposed settlement namely the deduction of tax from the settlement sum, the requirement that consent orders be signed dismissing the Application and the scope of the confidentiality obligations under the deed. 89
[77] In this context Mr Tucker also submits that the 13 November Letter “expressly recorded [the parties’] intentions to by [sic] bound when and if, a deed was agreed and executed.” 90
[78] In oral submissions Mr Tucker submitted that it would be “irrational” for the Commission to find that a binding settlement agreement had been reached between the parties on 13 November 2019 as it is clear that the terms of the Deed are unacceptable to him and that is why he has not signed it. 91
[79] Further, Mr Tucker submits that the Telephone Conversation is incapable of binding the parties as an such agreement was expressly stated as being subject to execution of a formal deed. 92 Mr Tucker submits that phrases such as “subject to contract” give rise to a presumption that no binding agreement is reached between the parties.93 Mr Tucker relies upon Masters v Cameron94 and Edge Development Group Pty Ltd v Jack Road Investments95 (Edge Development) in support of this proposition.96
[80] Finally, Mr Tucker submits that Mr Francis did not have authority to enter into a binding settlement agreement on or around 13 November 2019. 97
Consideration
Was an agreement made on 13 November 2019?
[81] As at November 2019 both parties were vigorously prosecuting their respective cases in relation to the Application. Both parties had filed submissions and evidence. Both parties had made interlocutory applications which were heavily contested by the other. A mention hearing was listed on 14 November 2019 at which time Mr Tucker’s application for orders to produce would be determined and a hearing was listed to commence six days after that on 20 and 21 November 2019. There was, as submitted by the SRO, a contest between the parties which was on the path towards a hearing and determination. 98 It was in this context that the 12 November Letter and the 13 November Letter were sent. There is no doubt that the 12 November Letter was capable of acceptance by the SRO. The SRO’s response to that offer was the 13 November Letter. In my view, the 13 November Letter does not directly correspond to the 12 November Offer and introduces terms which would not be implied by law and which are not solely for the benefit of Mr Tucker. I consider the 13 November Letter is most appropriately characterised as a counter-offer. The SRO does not contest this characterisation of the 13 November Letter. That counter-offer was capable of acceptance by Mr Tucker. Ms Ford’s evidence, which I have accepted, is that Mr Francis, as Mr Tucker’s legal representative, accepted that counter-offer in the Telephone Conversation by saying “we accept the terms of settlement…”. That acceptance was therefore unambiguous, unconditional and directly corresponded to the counter-offer made. I consider the language used by Mr Francis was such as to convey to a reasonable person in Ms Ford’s position a clear and definite decision by Mr Tucker to be bound by the terms of the offer, leaving nothing further to be negotiated.For my part, I consider it is difficult to see how the words “we accept the terms of settlement” could be clearer or open to any other interpretation. Further, Ms Ford’s evidence is that it was her understanding from her conversation with Mr Francis that the parties had a binding agreement.99
[82] I consider it of no consequence that the formalities of the deed remained to be discussed. A contract must be clear and complete at least in the essentials. 100 Certainty is required only of essential terms, not inessential terms, with the result that a contract may be in existence even though the parties have reached agreement on the essential terms of their bargain but they have not discussed inessential terms.
[83] Mr Tucker contends that there is still uncertainty and dispute as to the essential terms of the settlement. I do not consider this contention is supported by the evidence. Mr Tucker contends that the deduction of taxation from the settlement sum, the requirement that consent orders be signed dismissing the Application and the scope of the confidentiality obligations under the deed are the terms which are uncertain and in “heated” dispute (Disputed Matters). Mr Tucker contends that these terms constitute a counter-offer which at no time was accepted. 101 I accept the submission that the 13 November Letter was a counter-offer by the SRO. The evidence, which I have accepted, is that that counter-offer was accepted, unconditionally, by Mr Francis in the Telephone Conversation. The 13 November Letter expressly provided that the settlement sum would be “less any taxation which must be withheld by law”, that “the parties will consent to an order that the unfair dismissal proceeding be dismissed with no right of reinstatement”and that “the settlement, the terms of settlement and all correspondence and communications leading to the settlement shall remain confidential to the parties and cannot be disclosed or communicated to any person other than with the written consent of the other party or as required by law.” Accordingly, each of the Disputed Matters are expressly set out in the 13 November Letter and were therefore accepted by Mr Francis. Further, I do not consider they give rise to any uncertainty. The fact that in subsequent communications Mr Tucker sought to depart from those terms does not affect the unconditional acceptance of them by Mr Francis.
[84] Accordingly, I consider an agreement was made between the parties on 13 November 2019 on the terms set out in the 13 November Letter.
Was the agreement binding?
[85] Mr Tucker contends that no binding agreement was made on 13 November 2019 as the 13 November Letter was conditional on his agreement to execute a deed and he has declined to do so. In oral submissions he contended that the parties had an agreement to agree only. 102 He submits that the counter-offer was “subject to contract” and therefore did not give rise to a binding agreement.103
[86] The 13 November Letter was expressly stated as being “subject to [Mr Tucker’s] agreement to execute a deed of release…”. It then set out the terms which would be recorded in the deed “save for formalities”. Accordingly, the counter-offer contained in the 13 November Letter was subject to Mr Tucker’s agreement to execute a deed of release on the terms set out therein. It was not expressed as being subject to the execution of a deed by Mr Tucker or subject to the preparation of a deed. It was therefore not expressed to be “subject to contract” or any similar phrase as contended by Mr Tucker and as contemplated in Masters v Cameron and Edge Development. Nor did it provide, as also contended by Mr Tucker, that the parties would be bound when, and if, a deed was agreed and executed. It provided that an agreement would be reached when Mr Tucker agreed to execute a deed on the terms set out in the letter, save for formalities. In these circumstances, I do not consider that the language used by the parties gives rise to a presumption that no binding agreement was reached between the parties. Mr Tucker, via his representative, accepted that counter-offer unconditionally. By accepting the counter-offer in the 13 November Letter, Mr Tucker thereby agreed to execute a deed of release on the terms set out in the letter. Mr Tucker’s subsequent refusal to do so does not mean that a binding settlement agreement was not reached on 13 November 2019.
[87] Mr Tucker relies upon the use of the phrase “pending the execution of a deed” in the Francis Email as also giving rise to a presumption that no binding agreement was reached on 13 November 2019. 104 I do not consider in the present circumstances that the phrase “pending the execution of a deed” gives rise to such a presumption. Firstly, this submission is unsupported by any authority. Secondly, I consider that on a plain reading the ordinary meaning of “pending the execution of a deed” means awaiting the execution of a deed. Thirdly, I consider the use of the word “pending” rather than the phrase “subject to” supports that interpretation. Fourthly, that which is pending is the execution of a deed, not the negotiation of a deed or agreement as to its terms. Accordingly, I find no support for Mr Tucker’s contention that the use of the phrase “pending the execution of a deed” in the Francis Email supports a conclusion that no binding agreement was made on 13 November. Indeed, to the contrary, I consider the language of the Francis Email supports a conclusion that a binding agreement had been reached and that the parties were awaiting the execution of a deed. Accordingly, I also therefore do not find the Francis Email to be inconsistent with Ms Ford’s evidence as contended by Mr Tucker. I return to the language of the Francis Email in paragraph [92] below.
[88] Mr Tucker’s evidence is that Mr Francis did not have authority to enter into a binding settlement agreement on or around 13 November 2019. 105 Mr Tucker was not required for cross examination and that evidence was therefore not challenged in any way by the SRO. I find Mr Tucker’s evidence on this point implausible. It is not able to be reconciled with Mr Francis’ conduct in sending the 12 November Letter seeking to settle the Application, the fact that the 13 November Letter was forwarded to Mr Tucker by email one minute after receipt by Mr Francis, the Telephone Conversation occurring some eight minutes subsequent to that action, the sending of the Francis Email very shortly thereafter and the subsequent communications regarding the settlement on 14 November 2019. However, even if Mr Francis did not have actual authority to bind Mr Tucker to a settlement agreement on 13 November 2019, I consider he had ostensible authority to do so. Whilst it is well established that solicitors have authority to conduct negotiations on behalf of their clients as to the terms of a contract between parties,106 a solicitor does not generally have authority to bind a client to a contract without clear and cogent evidence of such authority. This general proposition is subject to the qualification that in the context of litigation, a legal practitioner has ostensible authority to bind their client to a contract which relates to, and in particular comprises, that litigation.107 As at 13 November 2019 the Application was on foot and being vigorously contested. Mr Francis was, by way of formal notice, on the record as Mr Tucker’s legal representative in relation to the Application. He represented Mr Tucker at the member assisted conciliation conference in relation to the Application on 8 November 2019 and forwarded a without prejudice offer to Maddocks, as legal representative for the SRO, to settle the Application on 12 November 2019. He communicated with Maddocks in relation to the 13 November Letter. He communicated with the Commission regarding the vacation of the mention hearing in the Application listed for 14 November 2019 following the 13 November Letter being forwarded to him and engaged with Maddocks subsequently in relation to the Deed. Litigation, in the form of the Application, had clearly commenced and was on foot and any settlement agreement that was reached on 13 November 2019 was clearly in relation to and in compromise of the Application. In these circumstances, I consider that if Mr Francis did not have actual authority to bind Mr Tucker on 13 November 2019, he had ostensible authority to do so.
Post-agreement conduct
[89] Mr Tucker submits that the parties conduct post November 2019 demonstrates that there was no binding settlement agreement. 108 Mr Tucker submits that this is evidenced by the fact that post November 2019 he has made three settlement offers which have all been rejected by the SRO.109 In particular, he relies upon the following matters:
• the Global Settlement Letter and the statement in that letter that the Application was still “on foot” and does not make reference to any agreement or deed; 110 and
• the 19 March Letter which, Mr Tucker submits, makes no reference to a settlement agreement or deed and uses language that indicates that the proceeding was still active. In particular, Mr Tucker says that the letter says that the Commission had “yet” to determine the SRO’s objections to Mr Tucker’s evidence and witness statements were “yet” to be read into evidence. 111
[90] Mr Tucker also submits that in hearings before the Commission the SRO, through its legal counsel Mr Forbes, has made inconsistent and misleading representations as to the status of any agreement. Firstly, Mr Tucker says that at the mention hearing on 13 February 2020 112 Mr Forbes “expressly agreed with Mr Tucker’s summary of the status of the failed settlement negotiations”113 and concurred with Mr Tucker’s position that no settlement agreement had been concluded.114 Secondly, Mr Tucker says that at the hearing on 5 June 2020 Mr Forbes failed to provide a direct answer to the Commission’s question as to why the binding settlement asserted by the SRO had not been previously brought to the Commission’s attention.115 Mr Tucker submits that there has been no explanation for this and further there has been no material change in circumstances between 13 February 2020 and 5 June 2020.116 Mr Tucker submits that Mr Forbes has undertaken a “backflip” with respect to the status of the proceedings.117 Finally, Mr Tucker submits that the SRO’s express acknowledgement of the failed negotiations together with its unexplained delay in filing its application is inconsistent with a binding settlement agreement being reached between the parties on 13 November 2019.
[91] The SRO submits that the parties for the most part have conducted themselves on the basis that a binding settlement agreement has been reached. 118
In principle agreement, the Francis Email and other communications
[92] The Francis Email states that the parties have reached an “in principle” settlement. As already set out, such a phrase generally indicates that there is no intention yet to enter into a binding contract. However, the phrase must be construed in the context in which it appears and the commercial setting in which the parties were operating. The SRO submits that the meaning to be given to the expression “in principle” should be taken from the 13 November Letter 119 and should be understood to mean that there is a binding agreement although the written terms evidencing it have not yet been executed.120
[93] I consider that the meaning to be given to the expression “in principle” agreement in the Francis Email is to be construed with reference to the 12 November Letter, the 13 November Letter and surrounding events. The 12 November Letter set out an offer to settle the Application “in light of the fact that the matter is listed for hearing next week” and in a “final attempt to settle this matter before the parties commence preparation in earnest.” The offer in the 12 November Letter was open for acceptance until 5.00 pm 13 November 2019. The 13 November Letter was responsive to the 12 November Letter and relevantly stated that “Subject to your client’s agreement to execute a deed of release in relation to the settlement of the Proceeding, the terms of the Offer are accepted in principle by the State.” The 13 November Letter then set out the content of the Deed to be executed by Mr Tucker. The offers made by the respective parties were therefore undertaken in the context of an impending hearing and contested mention listed for 14 November 2019 and, I consider, in an effort to finalise the Application to avoid the need for those matters to proceed. The 13 November Letter uses the expression “in principle”. I consider by doing so, the SRO was conveying to Patron Legal that Mr Tucker’s offer was acceptable in concept, subject to Mr Tucker’s confirmation that he would execute a deed containing the expanded settlement terms contained in the 13 November Letter. 121 That confirmation was provided in the Telephone Conversation at 5.12 pm, some nine minutes after the 13 November Letter was sent, by Mr Francis accepting the terms of the 13 November Letter. Further, the Francis Email seeks vacation of the following day’s mention hearing at which the Production Application was to be heard and determined. This occurred at Mr Francis’ request, is actioned within 20 minutes of the Telephone Conversation and is detrimental to Mr Tucker’s interests. In all of these circumstances, I do not consider the use of the phrase “in principle” in the Francis Email indicates that a binding agreement had not yet been reached. To the contrary, I consider the circumstances to indicate that the parties did intend a binding agreement to arise on acceptance of the counter-offer contained in the 13 November Letter. Accordingly, I consider the phrase “in principle” as used in the Francis Email to mean that a binding agreement had been reached but the Deed, which evidenced that agreement, had not yet been executed.
[94] It is to be noted that subsequent to 13 November 2019 both parties, at times, referred to an “in principle” agreement having been reached on 13 November 2019. In light of the above and all of the material now before the Commission, I consider that in the present circumstances such references do not indicate that a binding settlement had not been reached: rather, they indicate that the deed evidencing the agreement had not yet been executed.
Communications regarding the terms of the agreement
[95] It is clear that subsequent to 13 November 2019 there were communications between Patron Legal and Maddocks regarding the terms of the agreement reached on 13 November 2019. I do not consider these communications evidence that a binding agreement had not been made. Firstly, those communications were almost exclusively in relation to the Disputed Matters. The Disputed Matters were all set out in the 13 November Letter and I refer to and repeat my comments regarding those matters set out above. The fact that Mr Tucker subsequently sought to alter the terms agreed on 13 November 2019 does not support a conclusion that they were not so agreed. Secondly, the SRO’s position in relation to those matters remained unchanged. Other than accepting the minor changes sought by Mr Tucker to the Background section of the Deed, the SRO has maintained that the terms of the Deed were to reflect the counter-offer accepted by Mr Francis on 13 November 2019.
Correspondence regarding the Set Aside Application
[96] On 12 December 2019 Mr Tucker made the Set Aside Application. In correspondence to the Commission regarding that application Mr Tucker states that the Application “is stayed pending the parties ‘in principle agreement’ which remains subject of a proposed deed.” On 17 December 2019 the SRO responded to that correspondence stating categorically that “this matter has been settled”. The syntax of Mr Tucker’s correspondence is difficult. Firstly, it is clear that the Application was in no way ‘stayed’ as asserted by Mr Tucker. Secondly, the concept of an in principle agreement being pending is challenging. Thirdly, that that pending agreement could also ‘remain’ the subject of a proposed deed is not only further challenging but also tautologous. I consider Mr Tucker’s correspondence of 12 December 2019 to be confused and unclear and of little assistance as to whether the parties had reached agreement on 13 November 2019. Conversely, the SRO’s position is abundantly clear and consistent with a binding agreement having been reached.
Global Settlement Proposal
[97] As submitted by Mr Tucker, the Global Settlement Letter asserts that there are four proceedings still on foot, including the Application. It contains the Global Settlement Proposal and followed correspondence throughout November regarding the terms of the Deed, in particular in relation to the three Disputed Matters. The SRO’s response to the Global Settlement Letter on 23 December 2019 was that it was prepared to progress negotiations for a resolution of all matters between the parties, subject to Mr Tucker agreeing to certain terms. It further provided that if Mr Tucker did not wish to propose a settlement inclusive of those terms then he ought promptly execute the Deed evidencing the agreement reached between the parties in relation to the Application. 122 This was restated in the SRO’s subsequent letter of 21 January 2020.123 I consider this correspondence also supportive of a conclusion that a binding settlement agreement had been reached on 13 November 2019 in relation to the Application. Firstly, all of the proceedings the subject of the Global Settlement Letter were “on foot”, in the sense that none had been finally determined, dismissed or discontinued. I therefore do not consider this statement to necessarily be inconsistent with a binding settlement agreement having been reached on 13 November 2019 or to necessarily indicate that such an agreement had not been reached. Secondly, the Global Settlement Letter was a proposal from Mr Tucker seeking to resolve all litigation between the parties. As already set out, litigation had been commenced in a number of jurisdictions, including other Fair Work Commission proceedings and proceedings in the Supreme Court of Victoria. It therefore proceeds on an entirely different premise to the settlement of the Application. In that context, I consider it entirely unremarkable that it does not refer to the Deed or the agreement reached on 13 November 2019. I therefore do not consider the absence in that correspondence of a reference to the Deed or an agreement having been reached in relation to the Application, is indicative that a binding agreement had not been reached on 13 November 2019. Thirdly, whilst the SRO indicated a willingness to entertain such a settlement, subject to certain terms being agreed by Mr Tucker, in its response it expressly stated that if Mr Tucker was not agreeable to proposing a settlement on those terms, the agreement made on 13 November 2019 remained and Mr Tucker ought execute the Deed evidencing that agreement. Fourthly, the SRO’s assertions in its correspondence of 23 December 2019 and 21 January 2020 that a binding agreement was reached on 13 November 2019 were clear and unambiguous. Mr Tucker did not respond to either correspondence and in no way disputed the SRO’s assertions that an agreement had been reached. I consider the parties conduct in relation to these issues to be consistent with a binding settlement agreement having been reached.
13 February 2020 Mention
[98] The mention on 13 February 2020 was in relation to the Set Aside Application. The SRO submits that Mr Tucker’s submissions in relation to this matter have no basis and is misleading. It says Mr Tucker inaccurately states what occurred and that the serious allegation that counsel misled the Commission should be withdrawn. 124 It says that Mr Forbes responded to a specific question asked of him by the Commission.125
[99] The relevant extract for the mention is set out in paragraph [48] above. In response to a query regarding the status of the in principle agreement advised by Mr Francis on 13 November 2019, Mr Tucker said that “we’re still fighting about the mechanism of the deed”and“there was a settlement in-principle… However when the deed has come through from the State Revenue Office, there’s been what I consider outrageous bells and whistles added on...”.
[100] In response to the Commission’s question as to whether that reflected the Respondent’s position “that the deed has not been finalised?” Mr Forbes, counsel for the SRO, said:
“That’s – my understanding is that there’s sticking points in the deed and that’s a matter being dealt with between the parties.”
[101] Accordingly, Mr Tucker did not expressly say that settlement negotiations had failed or that a settlement agreement had not been concluded. Further, what Mr Forbes agreed with was that the Deed was a sticking point and had not been finalised. Mr Tucker’s submission on this point must therefore be rejected. As to whether Mr Forbes misled the Commission, I accept that Mr Forbes answered the specific question asked of him. As such, I do not consider it can be said that he misled the Commission. The SRO submits that it did not inform the Commission that it considered the parties had reached a final binding agreement because, firstly, at the time all communications between the parties were subject to without prejudice privilege and it would have been inappropriate for the SRO’s counsel to have breached privilege without consent and, secondly, the legal status of the agreement reached between the parties was “not germane to the matter being determined” as the matter before the Commission did not agitate the merits of the Application. I generally accept those submissions. Nonetheless, it is clear that at the mention the Commission was seeking to understand the status of the settlement agreement given previous correspondence from the parties and, in particular, the SRO’s correspondence of 17 December 2019 in response to the Set Aside Application whereby it wrote to the Commission saying “this matter has been settled”. The SRO therefore raised as an issue the settlement of the Application. In this context, I consider it entirely regrettable that the SRO chose on 13 February 2020 not to put directly before the Commission that it considered a binding settlement agreement had been reached on 13 November 2019, as it subsequently contended, and further, to have referred in its filed material to an “in principle” agreement having been reached between the parties without appropriate clarification.
[102] The decision in the Set Aside Application was handed down on 18 May 2020. 126 On the basis of the material before the Commission at that time, that decision found, as a preliminary matter, that no final binding settlement agreement had been reached between the parties. In light of all of the material now before the Commission, that conclusion appears to have been premature and in error.
Letter of 19 March 2020
[103] Whilst acknowledging that the letter of 19 March 2020 does use the word “yet”, I do not consider that the letter of 19 March 2020 supports a conclusion that no binding settlement agreement had been reached on 13 November 2019. In my view, the letter must be read in the context of the Set Aside Application and the interlocutory decision sought to be set aside by that application. Firstly, the letter contained only matters to do with the Set Aside Application and the offer by the SRO to settle that application. The Set Aside Application was an application to set aside or vary the Confidentiality Order. Mr Tucker sought the setting aside of those interim orders so as to use material filed by him in the Application (Documents) to report alleged improper conduct by the SRO to external third party regulatory bodies. 127 The Set Aside Application therefore does not deal with the substantive matters the subject of the Application or directly relate to them in any way. Secondly, in seeking the Confidentiality Order the SRO contended that the Documents contained sensitive and confidential taxpayer information and irrelevant, scandalous and vexatious argument and allegations highly prejudicial to the SRO, its officers and persons who were not a party to the Application.128 Commissioner Bissett granted orders precluding publication of the Documents on an interim basis pending the Presiding Member giving the SRO’s objections fulsome consideration at hearing.129 Therefore, at the time the interim orders were issued the Documents had not been read into evidence, did not form part of the record of the hearing and the Commission had not ruled on the SRO’s objections.130 In this context and, I consider, in light of these matters, the Commissioner granted certain interim confidentiality orders. Due to the agreement reached on 13 November 2019, and the subsequent vacation of the hearing, that position remained unchanged at 19 March 2020. Accordingly, in light of all of the circumstances, I do not consider the language of the letter of 19 March 2020 evidences or supports a conclusion that a binding settlement agreement had not been reached on 13 November 2019.
Delay
[104] Mr Tucker submits that the delay by the SRO in filing the Dismissal Application is inconsistent with an assertion that a binding agreement was made on 13 November 2019. He submits this is particularly so in light of the SRO’s “express acknowledgement of the failed negotiations”. 131 The SRO submits that since 13 November 2019 it has been pressing Mr Tucker to execute the Deed and that until he took steps to re-enliven his substantive claim by pressing the Production Application on 5 June 2020 it did not consider it necessary or appropriate to bring the Dismissal Application.132 It submits that 5 June 2020 was the first time since November 2019 that Mr Tucker had taken any steps to advance the Application133 and that this is a material change in circumstances between February 2020 and June 2020.134
[105] I have previously dealt with Mr Tucker’s submissions regarding the SRO’s asserted express acknowledgement of the failed negotiations. I consider that the evidence supports a conclusion that since November 2019 the SRO has, generally, been pressing Mr Tucker to execute the Deed. It is clear that from November 2019 until the end of January 2020 there were ongoing communications between the parties regarding the Deed, most specifically changes sought by Mr Tucker and associated matters. It is also the case that as late as 29 April 2020 in the context of the Pay Progression Dispute, Mr Tucker informed the Commission that the Application was “settled in principle”. 135 I also accept that the Set Aside Application did not agitate the substantive issues in the Application and that this did not occur until Mr Tucker pressed the Production Application. The Production Application was made approximately one month later on 5 June 2020, following which the Dismissal Application was made on 10 June 2020. In these circumstances I do not consider that there has been a delay by the SRO in bringing the Dismissal Application nor that the timeline is inconsistent with a binding settlement being reached on 13 November 2019.
Conclusion as to binding agreement
[106] Accordingly, I consider that the parties entered into an agreement on 13 November 2019. The terms of the agreement were those set out in the 13 November Letter. I find that that agreement was not “subject to contract” in the Masters v Cameron sense and that Mr Francis had ostensible authority to enter into the agreement. Following the Telephone Conversation all that was left to be performed was the preparation of a deed of release which would include formalities and the terms of the 13 November Letter in a more fulsome and precise form but not different in effect. I find that the agreement is of the first class of agreements identified in Masters v Cameron and accordingly, was binding, notwithstanding that Mr Tucker has not executed a deed in respect to the agreement reached or received payment of any settlement monies. However, should I be wrong as to the agreement falling within the first class of agreements identified in Masters v Cameron, I consider the agreement is also capable of falling into the second class of agreements identified by the High Court and is nonetheless binding. I find that the post agreement conduct, viewed objectively and in its totality, is, as submitted by the SRO, largely consistent with a binding agreement having been reached on 13 November 2019. I find no “irrationality” in this conclusion. The fact that Mr Tucker has subsequently sought to alter the agreement made on 13 November 2019 and now no longer finds the terms acceptable does not mean that a binding agreement was not made on that date.
[107] For completeness, I note that it is not entirely clear to me that the terms of the Deed accurately reflected the terms of the 13 November Letter. However, it is not on this basis that Mr Tucker has refused to sign the Deed and indeed no such complaint was made at any time following provision of the Deed. Further, to focus on the form of the Deed, to use the phrase of the Full Bench in Zoiti-Licastro v Australian Taxation Office, 136 is to “miss the point”. The matter for determination is whether a binding settlement agreement was reached on 13 November 2019.
Section 400A – Costs incurred due to an unreasonable act or omission
[108] Mr Tucker submits that the SRO’s conduct in the Dismissal Application constitutes an unreasonable act or omission within the meaning of section 400A of the Act. 137 Mr Tucker says that there are a number of bases for this contention.138 Those submissions are misconceived, and I reject them. Not only is there no formal application for costs pursuant to section 400A before the Commission and, in light of section 400A(2), nor could there be, I have found that there was a binding agreement made between the parties on 13 November 2019 and, as set out below, that the Application is dismissed pursuant to section 587(1)(c).
Section 678 – False or Misleading Evidence
[109] Mr Tucker submits that in reliance on the matters referred to in the section 400A submissions, with particular reference to the alleged failure by the SRO to prosecute its application in accordance with the Model Litigant Guidelines, it is “open to the Commission to find” that the “SRO and its legal advisors” have attempted to give false and misleading evidence in contravention of section 678 of the Act. 139 I consider those submissions to be entirely misconceived. I reject them. For present purposes it is sufficient to note that contravention of section 678 is an offence, punishable by imprisonment for 12 months. It is therefore a criminal matter. It is in no way “open” to the Commission to “find” that section 678 of the Act has been contravened as submitted.
Is the Application without reasonable prospects of success?
[110] The SRO relies on the reasoning in Australian Postal Corporation v Gorman 140(Gorman) in support of its application that the Application be dismissed pursuant to section 587(1)(c).
[111] In Gorman the Federal Court confirmed that pursuant to section 587 of the Act, the Commission may dismiss an unfair dismissal application where a binding settlement agreement exists. 141 In Gorman Besanko J said:
“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. 142
…
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.” 143
[112] Section 587, relevantly, 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.”
[113] It is clear from Gorman that in circumstances where a binding settlement agreement has been reached between the parties it may be concluded that an application has no reasonable prospects of success. This is so because the agreement completely answers the claim. That cause of action is extinguished and its continued pursuit is, therefore, without reasonable prospects of success. I therefore find that the Application should be dismissed on the ground that it has no reasonable prospects of success.
Section 399A
[114] The SRO also seeks that the Application be dismissed pursuant to section 399A(1)(c) of the Act. Section 399A(1)(c) empowers the Commission to dismiss an application if it is satisfied that the applicant has unreasonably failed to discontinue the application after a settlement agreement has been concluded. Section 399A(3) provides that section 399A does not limit when the Commission may dismiss an application. The first legislative note to section 399A states “For another power of the FWC to dismiss applications for orders under Division 4, see section 587.”Accordingly, section 399A provides an alternative power under which the Commission may dismiss an unfair dismissal application and does not limit the Commission’s power to dismiss an application under section 587 on the ground that the application has no reasonable prospects of success. Given my determination in relation to section 587 above, it is not necessary to further consider section 399A in the present circumstances.
Disposition
[115] I find that an agreement was reached between the parties on 13 November 2019 in settlement of the Application. I find that that agreement was on the terms set out in the 13 November Letter and was a binding agreement, of the type identified in the first class of agreements in Masters v Cameron or, alternatively, the second class. In those circumstances, I am satisfied that the Application has no reasonable prospects of success. The Application is dismissed pursuant to section 578(1)(c) of the Act.
DEPUTY PRESIDENT
Appearances:
T Tucker on his own behalf.
J Forbes, counsel, for the Respondent.
Hearing details:
2020.
Melbourne (by telephone):
5 August.
Printed by authority of the Commonwealth Government Printer
<PR723228>
1 Witness Statement of Alison Gallaher at [1]; Transcript of hearing 5 August 2020, PN48-49
2 Witness Statement of Courtney Ford at [2]
3 Form F53 Notice of Representative Commencing to Act filed by Patron Legal on 8 November 2019, dated 6 November 2019
4 Respondent’s Outline of Submissions at [1]
5 Form F1 Application dated 10 June 2020, question 2; Respondent’s Outline of Submissions at [6]
6 Witness Statement of Alison Gallaher, Annexure APG-1
7 Ibid, Annexure APG-2
8 Witness Statement of Toby Tucker, Bundle at page 3
9 Transcript of hearing 5 August 2020, PN144
10 Witness Statement of Courtney Ford at [9]
11 Transcript of hearing 5 August 2020, PN144, PN181
12 Witness Statement of Courtney Ford at [10]
13 Applicant’s Outline of Submissions at [21(c)], [24]
14 Transcript of hearing 5 August 2020, PN455
15 Ibid, PN156
16 Ibid, PN160
17 Ibid, PN182-183
18 Ibid, PN157, PN159
19 Ibid, PN464
20 Ibid, PN453
21 Witness Statement of Courtney Ford at [13]
22 Witness Statement of Alison Gallaher at [20]
23 Ibid at [21]
24 Witness Statement of Alison Gallaher, Annexure APG-4
25 Witness Statement of Alison Gallaher, Annexure APG-4; Witness Statement of Toby Tucker, Bundle at page 12
26 Witness Statement of Alison Gallaher, Annexure APG-5; Witness Statement of Toby Tucker, Bundle at page 22
27 Ibid
28 Witness Statement of Alison Gallaher, Annexure APG-6
29 Ibid, Annexure APG-7
30 Ibid, Annexure APG-8
31 Email from Toby Tucker to the Fair Work Commission dated 12 December 2020 at 5.55 pm
32 Witness Statement of Toby Tucker, Bundle at page 27
33 Respondent’s Outline of Submissions in Reply at [4]
34 Transcript of hearing 5 August 2020, PN222
35 Witness Statement of Alison Gallaher at [31]
36 Ibid at [32]
37 Witness Statement of Toby Tucker, Bundle at page 34
38 Witness Statement of Alison Gallaher at [35]
39 Ibid at [36]
40 Ibid at [37]
41 Ibid at [38]
42 Transcript of mention 13 February 2020, PN14-23
43 Witness Statement of Alison Gallaher at [41]
44 Witness Statement of Toby Tucker at [15], Bundle at page 35
45 Witness Statement of Alison Gallaher at [42]; Witness Statement of Toby Tucker at [17], Bundle at page 38
46 Witness Statement of Alison Gallaher at [42]; Witness Statement of Toby Tucker at [17], Bundle at page 41
47 Witness Statement of Alison Gallaher at [43]
48 Ibid at [44]
49 Ibid at [45]
50 Ibid at [49]
51 Witness Statement of Alison Gallaher at [50]; Applicant’s Outline of Submissions at [15]
52 Applicant’s Outline of Submissions at [16]; Transcript of hearing on 5 June 2020, PN51
53 Applicant’s Outline of Submissions at [17]; Transcript of hearing on 5 June 2020, PN59
54 Witness Statement of Toby Tucker at [20]; Bundle at page 46-47
55 Witness Statement of Toby Tucker at [21], Bundle at page 48
56 Witness Statement of Toby Tucker at [23], Bundle at page 50
57 [2017] FWCFB 4562 at [45]-[54]
58 [2015] NSWCA 313 at [15]
59 Redowood Pty Ltd v Mongoose Pty Ltd [2005] NSWCA 32 (Redowood) at [84]
60 Boreland v Docker [2007] NSWCA 94 (Boreland) at [76]-[78]
61 Ibidat [76]; Cavallari v Premier Refrigeration Co Pty Ltd (1952) 85 CLR 20 at 26-27
62 Brookfield Australia Investments Limited v Lucas Stuart Pty Limited [2012] NSWSC 1130 (Brookfield) at [34]
63 Ibidat [30]-[31]
64 Ibidat [35], applying Howe v Connell [1997] NSWSC 432 and Stevenson v McLean (1880) 5 QBD 346
65 Redowood at [76], applying Carter v Hyde (1923) 33 CLR 115
66 Ibidat [84]
67 Capital Securities No. 1 Pty Ltd v Saliba [2016] NSWSC 1093 (Saliba) at [77]
68 Evans Deakin Industries Ltd v Queensland Electricity Generating Board (1984) 1 BCL 334
69 Saliba at [53]-[54], applying B Seppelt & Sons Ltd v Commissioner for Main Roads (1975) 1 BPR 9147 at 9149 per Glass JA
70 Stephenson v Dwyer [2006] NSWSC 1439 at [37]
71 Donaldson Coal Pty Ltd v Pacific National (NSW) Pty Ltd [2007] NSWSC 1446 (Donaldson Coal) at [91]
72 Ibidat [91]
73 [1954] HCA 72
74 Masters v Cameron [1954] HCA 72; 91 CLR 353 (Masters v Cameron) at 360
75 Ibidat 360
76 1986 40 NSWLR 622 (Baulkham Hills)
77 Ibid
78 Zoiti-Licastro v Australian Taxation Office (2006) 154 IR 1 at [10]-[12]; Howe v Connell [1997] NSWSC 432
79 Respondent’s Outline of Submissions at [42]
80 Ibid at [50]
81 Ibid at [53]
82 Ibid at [54]
83 Ibid
84 Ibid at [56]
85 Ibid at [57]
86 Ibid at [64]
87 Ibid at [65]
88 Ibid at [66]
89 Applicant’s Outline of Submissions at [23]
90 Ibid at [20(b)]
91 Transcript of hearing 5 August 2020, PN479
92 Applicant’s Outline of Submissions at [25]
93 Ibid at [26-33]
94 (1954) 91 CLR 353
95 [2018] VSC 326 (Edge Development)
96 Applicant’s Outline of Submissions at [29] – [32]
97 Witness Statement of Toby Tucker at [33]; Transcript of hearing on 5 August 2020, PN448-452
98 Respondent’s Outline of Submissions at [43]
99 Transcript of hearing 5 August 2020, PN169
100 Upper Hunter County District Council v Australian Chilling & Freezing Co Ltd (1968) 118 CLR 429
101 Applicant’s Outline of Submissions at [34], [36]
102 Transcript of hearing 5 August 2020, PN243-248
103 Applicant’s Outline of Submissions at [26]-[33]
104 Ibid at [28]
105 Witness Statement of Toby Tucker at [33]; Transcript of hearing 5 August 2020, PN448-452
106 Pavlovic at [137]
107 Lucke v Cleary & Ors [2011] SASCFC 118; Pavlovic at [150]
108 Applicant’s Outline of Submissions at [43]-[46]
109 Ibid at [43]
110 Ibid at [44]
111 Ibid at [45]
112 See paragraph [48] above
113 Applicant’s Outline of Submissions at [39]
114 Ibid at [21(d)(i)]
115 Ibid at [40]
116 Ibid at [42]
117 Ibid at [67]
118 Respondent’s Outline of Submissions at [72]
119 Ibid at [69]
120 Ibid at [70]
121 Ibid at [69]
122 Witness Statement of Toby Tucker, Bundle at page 34
123 Witness Statement of Alison Gallaher at [35]
124 Respondent’s Outline of Submissions in Reply at [30]
125 Ibid at [33]
126 [2020] FWC 2593
127 Email from Toby Tucker to the Commission dated 12 December 2019 at 5.55 pm
128 [2020] FWC 2593 at [5]
129 Ibid at [24]
130 Ibid at [26]
131 Applicant’s Outline of Submissions at [41]
132 Respondent’s Outline of Submissions in Reply at [37], [39]
133 Ibid at [39]
134 Ibid at [38]
135 Witness Statement of Alison Gallaher at [44]
136 (2006) 154 IR 1
137 Applicant’s Outline of Submissions at [21]
138 Ibid at [52] - [56]
139 Ibid at [65]
140 [2011] FCA 975)
141 See also Curtis v Darwin City Council [2012] FWAFB 2021
142 At [31]
143 At [33]
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