Tower v Jayco Corporation Pty Ltd

[2021] VCC 283

IN THE COUNTY COURT OF VICTORIA

AT MELBOURNE

COMMON LAW DIVISION

Revised
Not Restricted
Suitable for Publication

GENERAL LIST

Case No. CI-19-06256

EMMANUEL TOWER	Plaintiff
v
JAYCO CORPORATION PTY LTD	Defendant

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JUDGE:	HIS HONOUR JUDGE PILLAY
WHERE HELD:	Melbourne
DATE OF HEARING:	26 February 2021
DATE OF JUDGMENT:	24 March 2021
CASE MAY BE CITED AS:	Tower v Jayco Corporation Pty Ltd
MEDIUM NEUTRAL CITATION:	[2021] VCC 283

JUDGMENT
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Subject:  CONTRACT

Catchwords:             Whether agreement reached – Effect of an unexecuted Release – Whether solicitor acted without authority

Legislation Cited:     Workplace Injury Rehabilitation and Compensation Act 2013

Cases Cited:Pianta v National Finance & Trustees (1964) 180 CLR 146; Lucke v Clearly (2011) 111 SASR 134; CIC Insurance Ltd v Bankstown Football Club Ltd [1994] NSWCA 359; Pavlovic v Universal Music Australia Pty Ltd (2015) 90 NSWLR 605; Toll (FGCT) Pty Ltd v Aphapharm Pty Ltd (2004) 219 CLR 165; Masters v Cameron (1954) 91 CLR 353.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	The Plaintiff appeared in person
For the Defendant	Mr R Kumar	Russell Kennedy

HIS HONOUR:

1       Between 2011 and 2014, Mr Emmanuel Tower was an employee of Jayco Corporation Pty Ltd, the Defendant. He was a labourer for the Defendant, fitting out caravans. Mr Tower alleges that he suffered injury in the course of his employment. He brought a serious injury application against the Defendant in December 2017, through his former solicitors Maurice Blackburn. The parties subsequently held a conference at which statutory offers and counter offers were made by the respective parties. It is at this point the dispute currently before the Court arises. On Mr Tower’s case, his former solicitors then proceeded to settle his case without his authority and on uncertain terms. On the Defendant’s case, they engaged in negotiations with Mr Tower’s former solicitors and settled the case on wholly certain and standard terms. On their case, by reason of the settlement reached, Mr Tower’s current proceeding ought be dismissed.

2       With both parties occupying starkly different positions, there are three questions that the Court must answer to resolve the dispute:

(a)  Whether there was an agreement between the parties;

(b)  Whether the negotiations undertaken by way of email contained sufficient certainty and completeness to constitute a final binding agreement;

(c)  Whether the Plaintiff’s former solicitor possessed sufficient authority to settle the matter.

3       There are two reasons why the Plaintiff’s claim must fail. Firstly, the evidence of Ms McMullan, of Maurice Blackburn, is to be preferred to that of Mr Tower. This is due to the consistency of her evidence with contemporaneous file notes, audio recordings and the Affidavit material of Mr Donohoe, of Russell Kennedy. Secondly, on the basis of the above evidence, along with consideration of the viva voce evidence of Mr Tower, I find that the negotiations conducted via email in December 2019 were sufficiently certain and complete, so as to constitute the formation and conclusion of an agreement, regardless of any unexecuted release document.

4       I will deal with this claim by firstly addressing why the evidence of Ms McMullan must be accepted as to the authority she possessed to settle Mr Tower’s claim. Having made these findings, I will then consider whether an agreement was formed by Ms McMullan in the email exchange of 19 December 2019.

Background

5       Mr Tower is a 35 year old male, born in Sudan, who came to Australia when he was 19 years old. He commenced employment with the Defendant in 2011 as a labourer fitting out caravans. Mr Tower allegedly suffered injury due to repetitive heavy and awkward twisting, bending and lifting throughout the course of his employment. On 18 December 2017, Mr Tower brought a serious injury application pursuant to the Workplace Injury Rehabilitation and Compensation Act 2013 (“WIRCA) under sub-paragraphs (a) and (c) for injury to the lumbar spine, aggravation of pre-existing degenerative change in the lumbar spine, disc protrusion at L5/S1, anxiety and depression. He brought this claim via his former solicitors Maurice Blackburn Lawyers through their Dandenong office.

6       Mr Tower’s serious injury application was rejected by the Victorian WorkCover Authority on 12 April 2018. An Originating Motion was filed on 1 May 2018. In about October 2018 Ms Patricia McMullan began acting for the Plaintiff. She was admitted to practice as a solicitor in Victoria in March 2011 and had practised with Maurice Blackburn since that time in the area of workers compensation. Relevantly she worked at the Maurice Blackburn Dandenong office with a legal assistant named Louise Stanners. The receptionist at the Dandenong office was Jessica Ogilvie. Both Ms Stanners and Ms Ogilvie had interactions with Mr Tower over the period from October 2018 onward and particularly in late 2019. Ms McMullan and Ms Ogilvie were both called to give evidence at the hearing of this matter. 

7 Turning back to the chronological unfolding of relevant events. On 28 February 2019, the Court ordered that medical questions be referred to the Medical Panel for opinion pursuant to subparagraph 274(1)(b) of the WIRCA to assist in the determination of the serious injury dispute.

8       On 22 August 2019, the Defendant offered a serious injury certificate for pain and suffering damages only for the injury alleged to have been sustained on 8 September 2014. Mr Tower accepted this offer. Consequently, on 5 September 2019, the Originating Motion proceeding was dismissed by consent with the Defendant to pay the Plaintiff’s costs pursuant to the WorkCover (Litigated Claims) Legal Costs Order 2016.

9       On 30 September 2019, a section 333 conference was held at which the Defendant’s last offer to the Plaintiff was $100,000 plus costs plus keep. The Plaintiff’s last offer at the conference was $160,000 plus costs plus keep.

10 On 31 October 2019, the Defendant made a statutory offer of $100,000 as a net amount after the reduction required by s 343(1) of the WIRCA. This is equivalent to $100,000 plus keep plus costs. Pausing there, this offer and the consequences of accepting it were explained to Mr Tower.

11      On 12 November 2019, the Plaintiff made a statutory counter-offer of $400,000 plus retention of past benefits. At the time Mr Tower signed a document entitled “Authority to Make Statutory Counter Offer”.[1] This was a form prepared by Maurice Blackburn. Ms McMullan gave evidence that she and a partner of the firm Mr Gino Andrieri met Mr Tower regarding this offer.[2] She gave evidence that both she and Mr Andrieri advised the client that he should not make a statutory counter offer of this magnitude. She gave evidence that if he instructed her to make an offer at this level and against her advice then she (the firm) would no longer be able to act for him. As Mr Tower was adamant that he wished to make the offer of $400,000 plus retention of past benefits, plus costs, against her advice, she drew up the Authority to Make A Statutory Counter Offer document and took him through it.[3]  Relevantly that Authority advised of the costs consequences of failing to obtain judgment over 90% of the statutory counter offer and advised specifically what party and party costs were recoverable and what solicitor client costs would be deducted. At paragraphs (e) and (h) of that Authority Mr Tower was advised that the solicitor client costs were in excess of $70,000 but that such fees were reduced to $35,000. It then gave an example that if Workcover agreed to pay the $400,000 sought it would result in $365,000 “clear” to Mr Tower.[4] The document is signed by Ms McMullan and Mr Tower and dated 11 November 2019. A Statutory Counter offer of $400,000 plus retention of benefits was then made. According to the statutory timetable set out in the WIRCA that offer expired on 3 December 2019.[5] 

[1]Defendant’s Court Book (“DCB”) 209

[2]Subsequent to the hearing, Mr Tower sent to the Court an audio recording of this conversation. It is consistent with Ms McMullan’s evidence. The recording runs for 26 minutes and 31 seconds. The Defendant agreed it could be admitted into evidence. The Court listened to the recording.

[3]DCB 210 see also Transcript (“T”) 20, Line (“L”) 28 – T22, L6

[4]The audio recording records Mr Andrieri giving Mr Tower an example of solicitor client costs being deducted from the amount of money the case was settled for.

[5]DCB 261 at paragraph [13.2]. See also DCB 245

12      On Wednesday 4 December 2019, Ms Stanners called Mr Tower.[6] She confirmed the Statutory Counter Offer had not been accepted, had expired and that the Writ had to be issued by 20 December 2019.

[6]DCB 232

13      On Monday 9 December 2019, Mr Tower called and spoke to Ms McMullan. The details of this conversation are set out in the file note taken by Ms McMullan contemporaneously.[7] They are not in dispute between the parties.  Ms McMullan confirmed that the statutory counter offer had expired and the next step was to issue proceedings. Mr Tower wanted to claim superannuation as part of his claim but Ms McMullan told him this was not possible as his offer had expired and that the next step was to issue proceedings.[8] She confirmed that Maurice Blackburn would do this. Mr Tower wanted to see the Writ but she stated it was a standard document and that at some stage Mr Tower could draft his own statement of claim. She confirmed that after the matter was issued her office would copy his files and he could take them away.

[7]DCB 233

[8]Ibid

14      On 11 December 2019, it appears that Mr Tower called and spoke to Ms Stanners. Ms Stanners was not called to give evidence but an email that was sent by her to Ms McMullan records the discussion she had with Mr Tower.  No issue was taken with it. It records:[9]

“Just spoke to Emmanuel. He doesn’t want us to file the Writ anymore – he doesn’t want to go to Court. He wants us to settle it now.”

[9]DCB 235

15      On Thursday 12 December 2019 at about 0945, Ms McMullan called Mr Tower. In evidence Ms McMullan attempted to recall what had occurred during the course of the telephone conversation. At this stage she had no recourse to any file note as she did not believe that such a file note existed. She gave evidence that she confirmed Mr Tower did not want to issue proceedings but that he wanted to engage in further negotiations with the defendant. She gave evidence that she advised him that solicitor client costs were being reduced to $35,000 and would be deducted from the amount that he agreed to settle for. She then drew up a document for Mr Tower to sign entitled “Instructions – Further Offers”.[10] Before detailing the contents of that document I also record that after Ms McMullan’s evidence concluded, she contacted the Defendant’s lawyers during the hearing and advised them that she had now located a file note of her conversation with Mr Tower on the day. She forwarded it to them and they immediately informed the court and produced the document.[11]

[10]DCB 240

[11]Note: Document appears as Exhibit D2 – File Note of 12 December 2019 on exhibit list but the transcript says Exhibit D3 see T92, L16

16      I expressed concern at that stage that Ms McMullan and Maurice Blackburn had not complied with the terms of the subpoena issued by the Defendant for the production of its file to the court. I queried how this could happen, given the subpoena was addressed to a firm of solicitors well experienced in litigation.  The answer provided through Mr Kumar for the Defendant was that the firm had transferred its file to Mr Tower’s new solicitor, Maker Mayek of Mayek Legal in 2020 and the file note had been sent as part of that bundle.

17      Turning to the File Note itself,[12] it confirmed in large part Ms McMullan’s evidence. Namely that solicitor client costs had been reduced to $35,000 which would come out of the figure agreed with the Defendant.  Ms McMullan appears to have given an example to Mr Tower so he could understand this.  He indicated that he wished to receive $100,000 clear so she made plain an offer of $135,000 would need to be made and after the deduction of the $35,000 for solicitor client costs, it would mean $100,000 clear. She made plain to him that such an offer was likely to be rejected and a lower offer of $120,000 could be put.  However, she made plain that after deduction of the solicitor client costs of $35,000 he would clear $85,000. Mr Tower then asked whether the solicitor client fees could be reduced.  Ms McMullan said they could not.  This discussion regarding the amount of fees becomes important later on.  It was not mentioned by Ms McMullan during her evidence but from the file note that discussion was clearly had.

[12]Ibid

18      Ms McMullan then drew up the “Instructions – Further Offers” document.[13]  It is of central importance because it reduces to writing much of the discussion just set out above.  It is entirely consistent with the File Note of 12 December 2019 at 0945.  It set out that Mr Tower gave instructions to make an initial offer of $135,000 and if that was rejected to counter offer with a sum of $120,000. It advised that if either offer was accepted then his solicitors would charge $35,000 which was a reduced fee from what their true costs were.  It also confirmed that if settlement was reached a Release would need to be signed. That document was signed by Mr Tower and also by Ms Ogilvie the Maurice Blackburn receptionist, as a witness, on 12 December 2019.

[13]DCB 240 – 241

19      Later that same day, and armed with written instructions, on 12 December 2019 at 1619 Ms McMullan called Mr Donohoe and made an offer to the Defendant of $135,000 plus costs plus keep. That conversation is captured in Ms McMullan’s file note and is not contentious.[14] 

[14]DCB 237

20      Some days passed. On 18 December 2019 at 4:37pm Mr Donohoe emailed Ms McMullan in the following terms “I am instructed to make an offer of $80,000 plus keep to resolve this matter. I look forward to hearing from you.”[15]

[15]DCB 117

21      That same day on 18 December 2019 at about 1709 Ms McMullan called Mr Tower. This is a discussion of critical importance for the resolution of the matter.  I start by setting out Ms Mullan’s file note. She gave evidence that her practice was to make file notes contemporaneously to record conversations in an email form and then send that email to herself.[16] This is what she believes she did on this occasion. The file note bears the “sent” time stamp of 1720 and records the conversation occurring at 1709.  This is a contemporaneous recording and I find accurately records the conversation. It records the conversation she had with Mr Tower in the following terms: [17]

[16]T19, L20 – T20, L2

[17]DCB 199

PMC:

- I spoke with the defendant – put the offer of $135,000

- Rejected that offer

- They’ve come back with offer - $80,000

Clt:

- I’ll accept

PMC:

- Are you sure?

Clt:

- Yes

- Take it

PMC:

- So our legal fees will come out of it

- So you would it be $45,000 (sic)

Clt:

- Yes I will take that

PMC

- Okay I will need you to come in and sign the instructions tomorrow

- Made apt for 3pm

- Conseuqences (sic):

- No tax

- Deduct the $35,000

- You will receive $45,000

- Payment in early January.

22      The file note concluded by recording that Mr Tower said thank you to Ms McMullan.

23      Ms McMullan’s viva voce evidence confirmed this was an accurate recording of the discussion she had with Mr Tower.  In addition she stated that she confirmed his instructions on several occasions during the conversations to make sure he understood the implications of settling the case and primarily that he would receive $45,000 clear.[18] She gave evidence that he was not upset or angry at this time.

[18]DCB 199. See also T27, L21

24      Mr Tower denied this version of events. In his affidavit, sworn 9 October 2020,[19] at paragraph [4] he alleges “I specifically instructed Ms McMullan that I would accept a settlement sum in the amount of $80,000 clear, plus legal costs plus keep. I did not instruct Ms McMullan to make and accept an offer that is $80,000 inclusive”.  In a Further affidavit, sworn 19 November 2019, Mr Tower swore a different version of events.[20] At [6-9] of that affidavit he swore that on 18 December 2019 at about 1600 he called Ms McMullan to instruct her to make an offer that would result in the sum of $80,000 clear to him. He did not reach Ms McMullan and so conveyed these instructions to a person he thought was named Jessica.  Ms Jessica Ogilvie gave evidence that she did not recall this conversation and in any event as the receptionist she could not take instructions but would simply pass this on to the relevant lawyer as a client request wanting to speak to their lawyer.[21] Mr Tower’s further affidavit then asserted:[22]

“Ms McMullan called me back one hour later and asked me to attend their offices at 11.00am on 19 December 2019 to sign a settlement document so that she could pass it to the other party.

I deny Ms McMullan’s File Note dated 18 December 2019. I deny entire contents of the File Note. I clearly remember her saying that she had received my message from her assistant, Jessica, and that she wanted me to attend their offices at 11.00am the next day.”

[19]DCB 194

[20]DCB 250

[21]T44, L16 - 23

[22]DCB 251

25      On 19 December 2019 at about 0940 Ms McMullan telephoned Mr Donohoe. She queried whether he had reached the limit of his instructions. No doubt she did this despite holding instructions to resolve the case for $80,000, to make sure that she could not obtain any more for her client. He indicated that he had.[23] Then at 1036 Ms McMullan emailed Mr Donohoe in the following terms:[24]

“I confirm that I have obtained my client’s instructions to accept the offer of $80,000. I would be grateful if you could please send me a release before 2.30pm today if possible.”

[23]DCB 114

[24]DCB 117

26      On Ms McMullan’s version of events the 2.30pm time was so that she could have the release available when Mr Tower was due to attend at 3pm that day.

27      Two minutes later, at 10:48am, Mr Donohoe emailed Ms McMullan in the following terms:[25]

“Thanks for that. Please see attached release.”

[25]DCB 116

28      On Thursday 19 December 2019 Mr Tower attended at the Dandenong office of Maurice Blackburn. He had a conference with Ms McMullan. Ms McMullan handed him a document entitled “Settlement Instructions”[26] and the Release which Mr Donohoe had sent to her earlier that day. This much is agreed between the parties. Ms McMullan gave evidence that Mr Tower was not upset or angry at this time.  She said that she told Mr Tower that she had acted on his instructions and settled the case for $80,000 leaving him $45,000 clear.  He told her he wanted to take the documents away to look at so they agreed he would return the next day (20 December 2019) for him to sign the document.[27] Mr Tower gave contrary evidence. He said that he was upset and angry by his meeting with Ms McMullan.  He called in aid an audio recording he had of a conversation with Ms Ogilvie taken in January 2021 in which she confirmed her memory that he was upset and angry when he emerged from meeting with Ms McMullan. In his affidavit, sworn 19 November 2020,[28] he swore that at the meeting on 19 December 2019 that: [29]

“….This is when I came to know that I would walk away with $45,000 after Maurice Blackburn had deducted $35,000 for their legal costs.

I said to Ms McMullan this was not what I had instructed her to offer when I talked to her on the phone the day before. I told Ms McMullan I had clearly stated that I wanted $80,000 clear to me exclusive of costs. I had rejected an offer of $100,000 before that.”

[26]DCB 182

[27]T28, L22 – T29, L11

[28]DCB 249

[29]DCB 250, at paragraph [9-10]. See also DCB 195, his affidavit sworn 9 October 2020 at paragraph [5]

29      Ms McMullan gave evidence that on 20 December 2019, she attempted to call Mr Tower at about 0922. Her evidence was that he told her that he would come in at about 1100. This is supported by her file note at this time.[30]  Mr Tower denied this phone call occurred. He never attended. He did not sign the Settlement Instructions.

[30]DCB 243

30      On 20 December 2019 at 1525 Maurice Blackburn filed a Writ with the County Court and paid the filing fee.

31      On 6 January 2020 the Plaintiff’s solicitor emailed the Defendant “I’ve just left a voicemail about this matter. Mr Tower is refusing to sign the release provided. To protect his interests before the Christmas break, we issued a writ. We are now ceasing to act for Mr Tower. If you have any questions, please feel free to give me a call”.[31]

[31]DCB 116

32      On 31 January 2020, the Defendant sent a cheque for $80,000 to Mr Tower directly.

33      After the Writ was issued Maurice Blackburn ceased to act for Mr Tower. Mr Tower was then self-represented. On 10 May 2020 he filed a Statement of Claim.[32] On 1 July 2020 the Defendant filed a Defence.[33] At paragraph [10] the Defendant pleaded the Plaintiff’s claim had already been discharged by accord and satisfaction and consequently his proceeding should be dismissed entirely.

[32]DCB 13

[33]DCB 19

34      Subsequent to this Mr Tower obtained legal representation and Mayek Legal began acting on his  behalf. A Reply to paragraph [10] of the Defence was filed. In that Reply the Plaintiff broadly alleged that paragraph [10] was not sustainable as:

(a)  there was uncertainty as to any agreement - [1] of the Reply;

(b)  There was no intention to make a concluded agreement until a Release was signed – [2] of the Reply;

(c)  Ms McMullan acted without instructions – [3] of the Reply.

Authority to settle the case

35      The issue of whether Ms McMullan had authority to act as she did by accepting the Defendant’s offer on 19 December 2019 seems to me to arise first in terms of the chronological unfolding of events. This is primarily a factual dispute between the parties. 

36      Authority to contract on behalf of a client must be expressly given or deemed by necessary implication.[34] This can only be established with “clear and cogent” evidence of the solicitor’s authority.[35]

[34]Pianta v National Finance & Trustees (1964) 180 CLR 146 Barwick CJ at 152

[35]Ibid Menzies J at 154

37      Where actual authority cannot be established a party, such as the Defendant in this case, may rely on the principle that a solicitor has ostensible authority to act in a manner which ultimately binds the client to a contract.[36]  Generally a solicitor does not have such ostensible authority to contract on a client’s behalf. However this is subject to the qualification that “in the context of litigation, a legal practitioner has ostensible authority to bind his or her client to a contract which relates to and, in particular, compromises that litigation”.[37] 

[36]Lucke v Clearly (2011) 111 SASR 134 at [60-62]

[37]Ibid 61

38      This case is not one which was in litigation but rather the pre-litigation stage. To that extent any reliance by the Defendant on the alleged ostensible authority of Ms McMullan is misplaced.[38] 

[38]CIC Insurance Ltd v Bankstown Football Club Ltd [1994] NSWCA 359 as cited in  Pavlovic v Universal Music Australia Pty Ltd (2015) 90 NSWLR 605 at [151]

Consideration of the submissions on the authority of Ms McMullan

39      As set out above, Mr Donohoe put an offer of $80,000 plus keep to resolve the matter on 18 December 2019 at 1647. Shortly afterward Ms McMullan called Mr Tower to discuss the offer. I have set out the details of the factual dispute between the parties above.  Having weighed the facts in dispute, I find that Ms McMullan’s version of events is to be preferred.  I make this finding on the following bases. First, in all negotiations that were had to that point in time it had been explained to Mr Tower that solicitor client costs would be deducted from the amount offered. This can be seen in the Authority to Make a Statutory Counter Offer.[39] This was a document signed by Mr Tower evidencing his understanding of the concept of the deduction of solicitor client costs and also acknowledgement that the solicitor client costs fee had been reduced to $35,000. It is also confirmed in the discussion that Ms McMullan had with Mr Tower on 12 December 2019 at 0945.  I accept the evidence that she gave as to the content of that discussion, which relevantly, was that the solicitor client costs were $35,000 and would be deducted from the settlement amount.[40] I accept this evidence as it accords with two contemporaneous records being the file note of this day tendered as Exhibit D2[41] and also the Instructions – Further Offers.[42] These documents are strong evidence which support Ms McMullan’s evidence on oath. This is particularly so when regard is had to the Instructions – Further Offers document, which is signed by Mr Tower on the same day and acknowledges the solicitor client fees of $35,000 will be charged. The file note details the fact that not only was Mr Tower told of the charging of the solicitor client costs of $35,000 and that they would be deducted from the settlement sum but he was also given examples as to how this would work in practice.  The history of the way instructions were sought from Mr Tower and the manner in which solicitor client costs were to be deducted supports my finding that on 18 December 2019 Ms McMullan explained to Mr Tower that $35,000 would be deducted from the sum of $80,000. This is consistent with explanations he had been provided with since the time of the Statutory Counter Offer stage. 

[39]DCB 210

[40]T26, L13-17. See also T27, L21

[41]Note: Exhibit D2 is referred to as D3 in transcript. See T92, L16

[42]DCB 240

40      Secondly, and ancillary to this is the fact that the Defendant did not change the way the offers were put.  It is true that Ms McMullan and Mr Donohoe used shorthand expressions in their negotiations such as “plus keep plus costs” but the format of the offers remained the same throughout from the time of the Statutory Counter Offer. The narrow focus of discussions came to centre on the money amount offered.  When regard is had to that, it becomes clearer that Mr Tower also became focused on that central aspect of the negotiations, being the money amount offered by the Defendant. The issue of his solicitor client costs was treated in the same way from the time of the Statutory Counter Offer: namely that the amount of $35,000 would be deducted from the figure offered by the Defendant.

41      Thirdly, there were substantial variations in Mr Tower’s recounting of the events of 18 December 2019.  They were so substantial that I was left unable to rely on his evidence with certainty and prefer Ms McMullan’s evidence overall.  For example, for  the first time in his affidavit of 19 November 2020 (and despite 2 earlier affidavits)  Mr Tower swore that he called Ms McMullan at 1600 on 18 December 2019 to make an offer that would result in the sum of $80,000 clear to him. This seems inconsistent with surrounding circumstances. Given that there had been no response from the Defendant to the offer of 12 December in the sum of $135,000 Mr Tower was here “bidding against himself” by reducing his own offer under no compulsion. Further he had signed the Instructions – Further Offers document which already gave Ms McMullan instructions in the event the offer of $135,000 was not accepted. Why he felt the need to give additional instructions coming down even further from the Instructions- Further Offers document was unexplained. I also note that Mr Tower swore that he conveyed these instructions through Ms Ogilvie.  This was the first time such an allegation had been made. She had no memory of such a conversation. There is no file note recording that Ms Ogilvie passed a message to Ms McMullan to call Mr Tower back. Similarly the File Note of 18 December 2019 at 1709[43]  contains nothing that supports the facts alleged by Mr Tower. In fact it is directly inconsistent with other facts. For example Mr Tower asserts that upon calling back, Ms McMullan asked Mr Tower to attend at 1100 on 19 December to sign a “settlement document” which could be passed to the other party.[44] This seems implausible given that at 1637 Mr Donohoe had written with the offer of $80,000 to attempt to resolve the matter.  Quite clearly, Ms McMullan knew that $35,000 would be deducted from this sum leaving Mr Tower with $45,000. This was not the amount he allegedly communicated to her at about 5pm that he wanted (which was $80,000 clear) on his evidence. In those circumstances, with an offer that did not satisfy her client there is no reason for her to tell him to come in to sign a settlement document. It is also inconsistent with the Instructions to Settle document which she drafted, but Mr Tower did not sign.[45]

[43]DCB 199

[44]DCB 250, at [6-9]

[45]DCB 182

42      The inconsistency in Mr Tower’s evidence was also manifest during his cross-examination.  He alleged in his evidence, and seemed to accept, that he knew that an offer of $80,000 had been made on 18 December 2019 and that Ms McMullan explained to him that solicitor client costs of $35,000 would be deducted from it.[46] He seemed to accept that his real dispute with Ms McMullan was the solicitor client fees he was being charged.[47] This is all consistent with the File Note  of 18 December 2019 but is nowhere found in his 3 affidavits.  Why this was so is not explained.

[46]T60, L6-21

[47]T61, L13-19

43      For the above reasons I find that on 18 December at about 1700 Ms McMullan spoke by phone with Mr Tower. She explained the offer of $80,000 to him and that it was plus keep and plus costs. She explained that $35,000 in solicitor client would be deducted leaving him clear with $45,000. I find that he gave her instructions to accept the offer.

44      These findings are sufficient to conclude that Ms McMullan as solicitor for Mr Tower had actual authority to accept the offer made by the Defendant contained in Mr Donohoe’s email of 1637 on 18 December 2019. She acted on that authority and within the scope of her instructions  by accepting that offer in her email of 1036 on 19 December 2019.[48]

[48]DCB 117

Was an agreement formed by Ms McMullan’s email of 19 December 2019

45      The Plaintiff submits that the email exchange between the parties on 18 and 19 December 2019 constituted negotiation only and not a binding agreement.[49]  The Defendant contends otherwise.[50]

[49]Plaintiff’s Submissions at [23] DCB 67-68 dated 9 September 2020 signed by Ms Burke of Counsel

[50]Defendant’s Submissions at [16] DCB 31 dated 31 July 2019 signed by Mr Kumar of Counsel

46      The Plaintiff’s primary ground for this submission was that the email Ms McMullan sent on 19 December 2019 was a counter offer which had the effect of extinguishing the offer made by Mr Donohoe on 18 December 2019.  The email exchange is set out below: [51]

[51]DCB 97

“Mr Donohoe, 18 December 2019 at 1637 : “I am instructed to make an offer of $80,000 plus keep to resolve this matter. I look forward to hearing from you.”

Ms McMullan replied via email on 19 December 2019 at 1036:

“I confirm that I have obtained my client’s instructions to accept the offer of $80,000. I would be grateful if you could please send me a release before 2.30pm if possible.”

47      The relevant test as to whether there has been a concluded agreement has been stated as “what each party by words or conduct would have led a reasonable person in the position of the other person to believe”.[52]

[52]Toll (FGCT) Pty Ltd v Aphapharm Pty Ltd (2004) 219 CLR 165 at [40]

48      It would be incorrect to look at the emails of 18 and 19 December 2019 in total isolation to the surrounding negotiations between the parties. Since the Statutory Counter Offer the offers had been in the same formula, that is a sum of money plus keep (ie retention of statutory benefits to date) plus costs (those costs recoverable pursuant to the Workcover Litigated Costs Agreement 2016).  That formula did not vary through the Statutory Counter offer or the Instructions Further Offers document and can be seen in Mr Donohoe’s email of 18 December 2019 at 1637. The fact that by the end of the negotiations Ms McMullan had done away with expressing that part of the formula that was not contentious, being the “plus keep plus costs” component is not surprising. The issue that needed to be resolved was the amount of compensation. That is the point she dealt with in her email that was in contention between the parties.  The other issues were resolved and did not, I find, need to be expressed. This finding is reinforced by the fact that the Release sent immediately by Mr Donohoe reflects not only the sum agreed upon but that the settlement was on a plus keep plus costs basis.[53]  I find, contrary to the Plaintiff’s argument; that the email of Ms McMullan was an acceptance of the offer made by Mr Donohoe and not a counter offer.

[53]Release at DCB 121 contains no repayment obligation of the statutory compensation and agrees to pay costs according to the legal Costs Order

49      Alternatively to his first submission, Mr Tower then argues that the email exchange of 18 and 19 December 2019 was too uncertain and incomplete to be a binding agreement.[54] In particular, Mr Tower argues that the email exchange was too vague and uncertain as to costs, when payment was to be paid, whether it was contingent on a release being signed and the form of waiver. He argues that it was only when the Release was provided to him was he able to accurately understand the terms. Once again to look at the email exchange of 18 and 19 December 2019 in isolation would, in my opinion, be incorrect.  The email exchange represented the culmination of a process over months during which time the contentious terms of the agreement had been narrowed. Ultimately, the dispute was reduced to the appropriate monetary figure which is what the final email exchange resolved.

[54]Plaintiff’s Submissions at DCB 69 at [31] dated 9 September 2020 signed by Ms Burke of Counsel

50      In the matter of Masters v Cameron, the High Court held that a case involving alleged agreements such as this can fall within one of three classes: [55]

[55]Masters v Cameron (1954) 91 CLR 353 at 360

a)    where the parties have reached finality in arranging all the terms of their bargain and intend to be immediately bound to the performance of those terms, but at the same time propose to have the terms restated in a form which will be fuller or more precise but not different in effect.

b)    Where the parties have completely agreed upon all the terms of their bargain and intend no departure from or addition to that which their agreed terms express or imply, but nevertheless have made performance of one or more of the terms conditional upon the execution of a formal document.

c)    Where the intention of the parties is not to make a concluded bargain at all, unless and until they execute a formal contract.

51      I consider this matter falls squarely within the first class of cases discussed by Masters. As set out above the parties had over time come to narrow the agreement between them. By 18 December 2019, there was no dispute that there would be terms requiring a Release. Such was flagged with Mr Tower for example in the Instructions to Make a Statutory Counter Offer.[56]  The effect of settling after the expiry of the Statutory Counter Offer was also explained in the Instructions – Further Offers document.[57] Specifically it noted that a Release would be required to be signed prior to receiving settlement monies.[58]  It was with this knowledge that Ms McMullan entered into the negotiations. As has been set out above the formula (ie a sum of money plus keep plus costs) for the settlement of the proceedings did not change from the time of the Statutory Counter Offer to the time of Ms McMullan’s email on 19 December 2019. The only relevant outstanding matter was the issue of the sum of money.  This was offered by Mr Donohoe as being $80,000 and accepted by Ms McMullan in her responding email.  While it is argued that the offer by Mr Donohoe was a modification of this formula, in that it was silent as to costs, and should thus be construed as inclusive of costs, I find this unlikely.  At most it was an error as in the Release sent by Mr Donohoe immediately following acceptance by Ms McMullan the Release was clearly on a plus keep, plus costs basis. In any event, the email from Mr Donohoe was understood by Ms McMullan as an offer “plus keep plus costs” because she explained it in those terms to Mr Tower.[59]

[56]DCB 209

[57]DCB 240

[58]DCB 240 at [I]

[59]DCB 199

52      The Release did no more, I find, than reduce the agreement reached by Ms McMullan’s acceptance to writing. The terms were understood well prior to that.

Summary of findings

53      To summarise the findings above, I find that Mr Tower clothed Ms McMullan with actual authority to settle his case. This authority encompassed settlement of his case on the basis of accepting an offer of $80,000, plus costs plus keep with a Release to be signed. Such authority was given in the knowledge that Mr Tower, upon accepting, would be charged $35,000 so that he would receive $45,000 clear and have to sign a Release. Second, I find that, armed with that actual authority Ms McMullan accepted the offer made by Mr Donohoe on 18 December 2019 of $80,000 plus keep plus costs. I find this was sufficient to constitute a binding agreement between the parties. Though a Release was forwarded by the Defendant, it was never signed by Mr Tower. A cheque for the settlement amount of $80,000 was sent to Mr Tower on 31 January 2020 in fulfillment of the Defendant’s obligations.

Resulting orders

54      By reason of these findings, I consider there has been accord and satisfaction: An agreement to pay $80,000 for settlement of the Plaintiff’s damages claim against the Defendant.

55 By reason of this finding, the Plaintiff’s current proceeding cannot be sustained and is bound to fail, having no prospect of success. I will dismiss it pursuant to the inherent jurisdiction of the Court and if necessary, in reliance on s 63 of the Civil Procedure Act 2010.

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