Westpoint Constructions Pty Ltd v Lord - [2004] WASC 86

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CIVIL

CITATION: WESTPOINT CONSTRUCTIONS PTY LTD -v- LORD [2004] WASC 86

CORAM: PULLIN J

HEARD: 19 APRIL 2004

DELIVERED : 13 MAY 2004

FILE NO/S: CIV 1002 of 2001

BETWEEN: WESTPOINT CONSTRUCTIONS PTY LTD (ACN 009 399 740)
Plaintiff
AND
NIGEL LORD
Defendant

Catchwords:

Contract - Whether agreement between solicitors to settle litigation was contractually binding - Whether term of agreement that the terms of settlement be set out in a deed precludes finding of immediate contractual effect - Whether fact that other terms were later negotiated should lead to conclusion that agreement was not contractually binding

Legislation:

Nil

Result:

Preliminary issue decided in favour of defendant

Category: B

Representation:

Counsel:

Plaintiff: Mr N D C Dillon
Defendant: Mr J C Curthoys

Solicitors:

Plaintiff: Su & Co
Defendant: Ilberys Lawyers

Case(s) referred to in judgment(s):

Anaconda Nickel Ltd v Tarmoola Australia Pty Ltd (2000) 22 WAR 101
Australian Broadcasting Corporation v XIVth Commonwealth Games Ltd (1988) 18 NSWLR 540
Barrier Wharfs Ltd v W Scott Fell & Co Ltd (1908) 5 CLR 647
Baulkham Hills Private Hospital Pty Ltd v G R Securities Pty Ltd (1986) 40 NSWLR 622
Geebung Investments Pty Ltd v Varga Group Investments (No 8) Pty Ltd (1995) 7 BPR 14,551
LMI Australasia Pty Ltd v Baulderstone Hornibrook Pty Ltd [2001] NSWSC 886
Masters v Cameron (1954) 91 CLR 353

Case(s) also cited:

Brambles Holdings Ltd v Bathurst City Council (2001) 53 NSWLR 153
Film Bars Pty Ltd v Pacific Film Laboratories Pty Ltd (1979) 1 BPR 9251
Rossiter & Curtis v Miller (1878) 3 App Cas 1124
Sinclair Scott & Co Ltd v Naughton (1929) 43 CLR 310

PULLIN J: This is the trial of a preliminary issue which arises in the following way. The plaintiff, through different versions of its statement of claim, alleges that the defendant ("Mr Lord"), a quantity surveyor, who was employed by Westpoint Developments Pty Ltd, estimated the cost of construction of certain projects for which the plaintiff was tendering. The plaintiff pleads that the defendant was negligent in the estimates he produced. It pleads that the costs which should have been estimated for the projects were significantly greater than the estimates made and represented to the plaintiff. As a result, the plaintiff claims damages. A Norman Carey ("Mr Carey") was the managing director of both the plaintiff and Westpoint Corporation Pty Ltd. Westpoint Corporation Pty Ltd dismissed the defendant from its employment because of the alleged negligence.
The defendant defends these proceedings by denying the allegations of negligence. The defendant also pleads that the proceedings have been settled and the preliminary issue being tried is to establish whether or not that is so.
The preliminary issue to be determined by me is:
"1.Pursuant to Order 32 Rule 4 the following issues be determined as preliminary issues:
(a)WHETHER during the course of discussions between Ms Melissa Quai, on behalf of the Defendant, and Mr Shane Sirett, on behalf of the Plaintiff and Westpoint Corporation Pty Ltd, the Defendant made an offer of settlement in the following terms:
(i)Westpoint Corporation Pty Ltd would pay the Defendant the sum of $18,000.00 by way of an eligible termination payment.
(ii)The proceedings in the Supreme Court including any claim or order for costs would be compromised by the payment.
(iii)The terms of settlement would be set out in a Deed of Settlement that would amongst other things, incorporate a confidentiality clause.
(b)Whether Westpoint Corporation and the Plaintiff accepted the offer by facsimile dated 21 August 2001 sent by Shane Sirett of Wojtowicz Kelly on behalf of Westpoint Corporation and the Plaintiff.
(c)Whether the proceedings herein have been compromised."
The evidence for the defendant consisted of a witness statement of Melissa Quai, a solicitor at Ilberys who acted for Mr Lord. This statement was tendered without objection from the defendant, and indeed Ms Quai was not called as a witness. The statement stood as the evidence‑in‑chief and there was no cross‑examination. The evidence on behalf of the plaintiff consisted of two witness statements signed by Mr Sirett, a partner of the firm of Wojtowicz Kelly which acted for the plaintiff and Westpoint Developments Pty Ltd. Mr Sirett's statements were tendered without objection; they stood as his evidence‑in‑chief, there was no cross‑examination; and, again, Mr Sirett was not called.
When I read the written submissions filed by the plaintiff before the trial commenced, I noticed that the plaintiff submitted that there was a difference between the two solicitors about what happened at the meeting on 21 August 2001 and that I should prefer the evidence of Mr Sirett. Before any evidence was received, I asked counsel for the parties how I could resolve an issue of that kind without hearing and seeing the witnesses give evidence. The parties, however, informed me that they wished to proceed with the arrangement they had reached, whereby each would consent to the tender of the statements and each would not require the witness for cross‑examination. The parties informed me that they wished me to decide the matter by reference only to surrounding circumstances, and not by reference to the demeanour of the witnesses. It is usually advisable for a court to try and resolve differences by taking into account the surrounding circumstances and ascertaining which version of events those circumstances support, but it is also relevant to take into account the demeanour of witnesses when they give their evidence. I am, however, prepared to proceed as the parties have agreed. It is clear that I could not have proceeded in this way without the parties' agreement. It seems that pragmatism is to some degree the explanation for the parties agreeing to follow this course, because Ms Quai is now overseas and it is not known when, or whether, she will return. As it turns out, the documentary material strongly suggests how I should resolve the issue between the witnesses. Apart from the one issue which I will identify when I reach it in the chronology, the facts are not in dispute. I therefore find the facts to be as follows.
On 2 August 2000, the defendant commenced proceedings against Westpoint Corporation Pty Ltd in the Western Australian Industrial Relations Commission, alleging that his dismissal was harsh, oppressive, or unfair, and claiming an order that his former employer pay him compensation. The application annexed to it a letter from Westpoint Corporation Pty Ltd to the defendant, dated 12 June 2000, stating that Mr Lord's employment was terminated on 7 July 2000 and giving the reasons for termination as follows:
"Over the past 12 months, I have lost total confidence in your ability to carry out your job. This complete lack of confidence is brought about by the results of your work on the procurement and delivery of firstly the Canning Bridge Auto Lodge job which had an outcome which was considerably less than you (sic) forecast margin due to errors in both the scope and pricing of the job. This matter was discussed with you at the time and the seriousness and potential consequences were outlined to you.
Secondly, the only other job you won during this period being the Cottesloe job where the initial tender margin forecast was significantly higher than ultimately proved to be the case. Your response to my memo of 19 May 2000 requiring your explanation of this position is totally unacceptable.
Having investigated these matters thoroughly, I find that your actions on these jobs and others have demonstrated a lack of reasonable care and attention amounting to wilful neglect, particularly when you hold yourself out to be professionally qualified in quantity surveying and estimating."
On 3 January 2001, the plaintiff commenced these proceedings with the issue of a writ. As I noted above, the plaintiff was claiming damages for negligent estimating. The claims included claims relating to the projects referred to in the above letter. Thus, the two cases raised common issues, central to the resolution of both.
On 5 April 2001, the Industrial Relations Commission issued a notice of hearing stating that Commissioner Kenner would hear the matter listed in the Commission on 21, 22, 23 and 24 August 2001.
On 16 August 2001, the plaintiff in these proceedings filed a minute of substituted amended statement of claim pursuant to an order which had been made by a Master. It pleaded that the Mr Lord was an employee of Westpoint Corporation Pty Ltd; that the managing director of both the plaintiff and Westpoint Corporation Pty Ltd was Mr Carey; and that Mr Lord prepared estimates for the work to be performed by the plaintiff in relation to two contracts, being a contract at Applecross and a contract at Cottesloe. Some confusion is revealed in the statement of claim about the amount of the claim for damages. It may have been for a total of about $200,000 or may have been for an amount of around $300,000.
On 17 August 2001, Mr Sirett signed a letter on Wojtowicz Kelly letterhead directed to Ms Quai at Ilberys, stating that Westpoint Corporation Pty Ltd would not be contesting the issue of unfair dismissal and that that company would be participating only to make submissions about the appropriate level of compensation to be awarded. The letter, which was sent by facsimile, contained within it a paragraph reading:
"Please note that our client's position in the unfair dismissal proceedings does not in any way alter its position in relation to the proceedings in the Supreme Court. Those proceedings will continue and, indeed, the plaintiff never intended to link them to these proceedings."
On 20 August 2001, Ms Quai responded to the Wojtowicz Kelly facsimile of 17 August 2001, pointing out that Ilberys considered the minute of substituted statement of claim to be defective and inadequate, and stating an intention to have an application to strike out the statement of claim re‑listed before a Master, and noting that the plaintiff in these proceedings had already been ordered to pay costs on an earlier strike‑out application.
The letter then continued by making an offer of settlement which required Westpoint Corporation Pty Ltd to pay the defendant the amount of $20,000, and that the Supreme Court action and the proceedings in the Commission be discontinued, and that such settlement was to be in full and final settlement of all claims the parties (including any entity related to Westpoint Corporation Pty Ltd, Westpoint Constructions Pty Ltd or any entity in the Westpoint group) may have against the other. The letter continued:
"If your client is not prepared to settle the Supreme Court matter our client has instructed that he is prepared to settle the unfair dismissal matter in the Commission for $39,898.87 to be taxed as an eligible termination payment to be paid by Friday 24 August 2001. Our client will be seeking costs against your client in the Commission if your client only agrees to settle the unfair dismissal matter, in addition to costs in the Supreme Court matter."
Mr Sirett, on the same day or early on 21 August 2001, communicated a counter‑offer to Ms Quai, indicating that "Westpoint" would only agree to settle the Industrial Relations Commission proceedings and that "they want to proceed with the Supreme Court proceedings".
At 10.30 am on 21 August 2001, the hearing of the application in the Commission was convened before Commissioner Kenner. After the matter had proceeded for approximately 15 minutes, the hearing was adjourned following Commissioner Kenner's suggestion that it was in the parties' interests to try and settle the matter. As a result, in court 3 of the Industrial Relations Commission, Ms Quai and Mr Sirett negotiated and an offer was made by Ms Quai.
Mr Sirett in his statement says:
"11.In the adjournment that followed, the applicant's solicitor advised the applicant offered to settle on terms the respondent pay the applicant $18,000 (to be taxed as an eligible termination payment) with both the Application and the Supreme Court Proceedings to be compromised and the parties to bear their own costs in both matters. I responded with words to the effect: any settlement would need to be included in a deed of settlement, the terms will need to include a confidentiality clause, I will need to take instructions. The proposed terms of the settlement are set out on page 3 of my contemporaneous notes which are dated 21 August 2002 (sic) and were made while at the Commission. Attached to this statement and marked 'SS2' is a true copy of my contemporaneous notes."
Ms Quai's statement reads as follows:
"18.I made a without prejudice offer of settlement on behalf of Lord to Sirett in Court 3, Level 18 of the WA Industrial Relations Commission on 21 August 2001. I stated words to the effect that Lord offered to settle on terms that Westpoint pay Lord $18,000.00 to be taxed as an eligible termination payment in full and final settlement of Lord's WA Industrial Relations Commission Claim and the Supreme Court Action and any other claims Westpoint or any related entity may have against Lord and that Lord would not seek costs against Westpoint in the WA Industrial Commission or the Supreme Court. Annexed hereto and marked with the letters 'MQ5' is a copy of my handwritten note dated 21 August 2001."
The point of difference between the two is whether or not Ms Quai's offer was an offer which required settlement of claims by "any related entity" of "Westpoint".
The contemporaneous notes made by both lawyers do not reveal any reference to a settlement of claims by "any related entity". The letter sent on the same day by Mr Sirett recording the terms of the offer made no reference to the settlement of claims by "any related entity". Ms Quai did not at any stage complain that Mr Sirett had incorrectly stated the terms of the offer which she had made. The next day, in a telephone call to Mr Sirett, Ms Quai did refer to "related entitles", but only in relation to the deed of settlement which was to be prepared. Before I make my finding on this point of difference, I should record what happened during the rest of 21 August 2001. Mr Sirett, having heard and noted the oral offer made by Ms Quai, said he would need to contact Mr Carey to obtain instructions in relation to the offer of settlement. While Mr Sirett was attempting to contact Mr Carey, Ms Quai telephoned the Australian Taxation Office and made inquiries as to the taxation rate applying to an eligible termination payment.
At around 2 pm on 21 August 2001, both solicitors met before Commissioner Kenner again, and Mr Sirett advised that the applicant had made an offer to settle both the proceedings in the Commission and the Supreme Court proceedings, and advised that he would need to obtain instructions from his client. Mr Sirett said words to the effect that he thought that the offer was within the "ballpark". As a result, Commissioner Kenner adjourned the matter to the next day at 10.30 am. In the afternoon of 21 August 2001, Mr Sirett, on Wojtowicz Kelly letterhead, sent by facsimile to Ilberys, a letter dated 21 August 2001 reading as follows:
"Dear Ms Quai
Nigel Lord v Westpoint Corporation Pty Ltd
Industrial Relations Commission Proceeding No 1184 of 2000
We refer to the proceedings in the Industrial Relations Commission today and to our discussions over the course of the day.
Your client made a settlement offer in the following terms:
1.Westpoint pay him $18,000 by way of an eligible termination payment.
2.The proceedings in the Commission and in the Supreme Court, including any claims or orders for costs, would be compromised by the payment.
3.The terms of the settlement to be set out in a deed of settlement that would, amongst other things, incorporate a confidentiality clause.
We have received instructions to accept the offer on behalf of Westpoint.
Clearly, it will be necessary for our client to prepare and our respective clients to execute a deed of settlement. One term that was not explicitly stipulated is the time for payment. Given the need for the deed of settlement, we propose payment within 21 days.
Please confirm that we can proceed on the above basis.
In the circumstances, we propose that the proceedings tomorrow be adjourned by consent. A consent order dismissing the proceedings can be filed later as part of the settlement. If you agree with this suggestion, then please feel free to contact the Commissioner's associate to inform her of the present situation.
We look forward to hearing from you.
Yours faithfully
(signed)
WOJTOWICZ KELLY
[Contact: Shane Sirett]
enc"
Mr Sirett signed the letter.
I find that the oral offer made by Ms Quai is accurately reflected in the letter of 21 August 2001. The fact that neither solicitor's contemporaneous notes refers to related entities, and the fact that Ms Quai never complained that the letter inaccurately recorded the oral offer, lead me to make that finding.
The offer was one made to both the plaintiff in these proceedings (and hence the reference to the settlement of the Supreme Court proceedings) and to Westpoint Corporation Pty Ltd (and hence the offer to settle the Commission proceedings). The companies were together referred to in the letter as "Westpoint". Counsel for the plaintiff agreed that this is how the letter should be read. Mr Sirett's letter accepting the offer was written on behalf of both companies.
The next day Ms Quai telephoned Mr Sirett, stating that the deed which was to be prepared would "have to include all related entities". There was discussion about the proceedings in the Commission, and it was agreed that it would be best to adjourn the proceedings and then file consent orders at a later stage.
Mr Sirett and Ms Quai then attended before Commissioner Kenner on 22 August 2001. Mr Sirett's note records what was said, either by the Commissioner, Mr Sirett, or Ms Quai. His note reads:
"Application to be adjourned for 14 days - pleased matter resolved - adjourned sine die."
Mr Sirett adds in his statement that he told the Commissioner that the matter "appeared" to have been resolved by agreement and asked for the adjournment for 14 days to allow the parties to "complete the necessary arrangements". The Commissioner adjourned the matter sine die.
On 23 August 2001, Mr Sirett sent the first draft of the deed of settlement, and a further draft was sent with a letter dated 30 August 2001. The draft recorded the release by Mr Lord of his claim in the Industrial Relations proceedings, the release by the plaintiff in this action, contained a confidentiality clause, and contained a provision about the date for payment of the $18,000 to Mr Lord.
On 31 August 2001, Ms Quai wrote to Mr Sirett referring to the draft deed of settlement. The second paragraph of the letter read:
"We refer to our conversation of 22 August 2001 that the settlement would be full and final in relation to all existing and possible claims by our client against Westpoint Constructions Pty Ltd, Westpoint Corporation Pty Ltd and any related entity of the Westpoint Group (as related entity is defined in the Corporations Law) …"
The letter then went on to say that Mr Lord had said that he required a number of amendments to be made to the draft deed, including some minor points in the recitals. In addition, Ms Quai again attempted to persuade Mr Sirett to incorporate the reference to the settlement of claims by related entities, and attempted to persuade Mr Sirett to introduce a provision that the parties and related entities would not make any adverse comments in relation to Mr Lord's period of employment and the circumstances leading to termination.

On 10 September 2001, Ms Quai rang Mr Sirett. He said he was "chasing the matter up"; that the deed was with his client; that he had requested them to read it and to confirm that they understood it properly. On 26 September 2001, there was an agreement that someone should be sent to the Commission to adjourn the case management conference which had been called on by the Commission, and Mr Sirett advised Ms Quai that he would "chase up" his client for the settlement deed.
On 27 September 2001, Ms Quai wrote to Wojtowicz Kelly saying that unless within 10 days the deed of settlement was executed and the settlement sum paid contemporaneously, the matter would be listed in the Commission, together with an application for costs.
On 5 December 2001, Ms Quai wrote to Mr Sirett, referring to the letter of 21 August 2001 and "confirming that your client accepted our client's offer to settle the claims in the Commission and the Supreme Court …". Mr Sirett responded by facsimile of 6 December 2001, stating that the letter of 21 August 2001 "indicated that settlement had been reached 'in principle'". The letter said that Wojtowicz Kelly had "encountered difficulty in obtaining the necessary instructions to confirm the terms of the settlement deed, incorporating your proposed amendments and the date for payment of the settlement monies". On 14 December 2001, in a brief hearing before Commissioner Kenner, Mr Sirett advised the Commissioner that Westpoint Corporation Pty Ltd was obtaining counsel's advice on the alleged settlement.

The law and application of the law to the facts

Where parties have executed an instrument in writing but it is uncertain whether in so doing they intend to create legal relations, the court may have regard to all the relevant circumstances to determine, objectively, what was the parties' intention. The relevant circumstances may include prior negotiations and subsequent conduct: see Barrier Wharfs Ltd v W Scott Fell & Co Ltd (1908) 5 CLR 647; Anaconda Nickel Ltd v Tarmoola Australia Pty Ltd (2000) 22 WAR 101 at [26].
In Geebung Investments Pty Ltd v Varga Group Investments (No 8) Pty Ltd (1995) 7 BPR 14,551 at 14,552, Gleeson CJ said there are:
"… two, sometimes related, questions which require to be considered. The first is whether the parties to the putative contract intended to make a concluded agreement. The second is whether they succeeded in doing so."
In Australian Broadcasting Corporation v XIVth Commonwealth Games Ltd (1988) 18 NSWLR 540 at 550, Gleeson CJ noted that the facts in that case did not make it one of those exceptional cases where subjective intention was directly in question. As in that case, nobody in this case suggested that in the course of their negotiations the representatives of the parties were joking, or doing or saying something that was intended to be taken other than at face value. Nor is it a case involving the actual state of mind of one or more of the parties to the contract affected by mistake, misrepresentation, duress, or undue influence. There may be cases (and this was not one) where the issue is the subjective state of mind of one or other of the parties. Normally, however, (and this is the case here) what is in issue is not the parties' subjective state of mind, but their "intention as expressed".
Thus, it is necessary to examine the communications which took place in this case, construed with regard to the subject‑matter of the negotiations and the surrounding circumstances, and in the light of subsequent communications between the parties, to determine whether there was an intention to make a concluded bargain: see Australian Broadcasting Corporation v XIVth Commonwealth Games Ltd (supra) at 551.
The points which the plaintiff refers to as indicating a lack of intention in the parties to reach a concluded agreement on 21 August 2001 were as follows:
(a)the fact that terms of settlement were to be set out in a deed of settlement to be executed by the parties;
(b)the fact that the deed of settlement would include "amongst other things" a confidentiality clause;
(c)the fact that the Commission was told on 21 August 2001, that the proceedings should be adjourned rather than dismissed;
(d)the fact that the time for payment was not stipulated;
(e)the fact that after 21 August 2001, Ms Quai asked for the deed of settlement to provide that related entities were also bound by the settlement;
(f)the fact that Ms Quai suggested the other amendments to the draft deed of settlement as set out above;
(g)the fact that Ms Quai said she would arrange to have the matter re‑listed before the Commission when the discussions about the deed broke down.
The plaintiff contends that the case falls within the third class of case referred to in Masters v Cameron (1954) 91 CLR 353 at 360, namely a case "in which the intention of the parties is not to make a concluded bargain at all, unless and until they execute a formal contract". The defendant, however, argues that the case falls within what McLelland J in Baulkham Hills Private Hospital Pty Ltd v G R Securities Pty Ltd (1986) 40 NSWLR 622 at 628 described as the "fourth class of case additional to the three mentioned in Masters v Cameron", or that it fell within the first class of case mentioned in Masters v Cameron (supra), namely that 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." The "fourth class" of case is "one in which the parties were content to be bound immediately and exclusively by the terms which they had agreed upon whilst expecting to make a further contract in substitution for the first contract, containing, by consent, additional terms."
The nature and subject‑matter of the transaction is relevant to the question whether the parties intended to be immediately, finally, and exclusively bound to a brief and informal document: see Anaconda Nickel (supra) at [157]. The magnitude, subject‑matter, or complexity of the transaction and the importance of terms that have been omitted, may suggest, in some cases, that the informal agreement is not intended to constitute a binding contract, notwithstanding that the parties may have used the language of agreement in their informal document: see Anaconda Nickel(supra) [158].
It is also clear that merely because parties contemplate the execution of a formal document or deed, does not mean that the less formal agreement is not presently binding as a contract. On the other hand, in some cases, the fact that the parties contemplate the drawing‑up and execution of a formal contract, may point to the conclusion that no presently binding agreement was intended until the formal contract is executed: see Geebung Investments (supra) at 14,569. It all depends on the circumstances of the particular case.
The transaction under question in this case was whether or not two sets of proceedings should be settled. In each case, a money claim had been brought. The proposal was that a sum of money be paid and accepted in settlement of all of the proceedings. It is clear that Mr Lord, in his proceedings in the Commission, had a claim for a sum in excess of $39,000. On the other hand, in the Supreme Court proceedings, the plaintiff had a claim for a larger sum. In effect, by abandoning part, or all, of a claim, or setting one off against the other, the parties could arrive at a settlement by agreeing the payment of a single sum of money payable by one to the other. Such an agreement was reached. There is nothing complex about the transaction in question.
The language used in Mr Sirett's letter of 21 August is completely unambiguous. It is couched in terms of offer and acceptance - language that even the most basically educated lawyer would understand - and the language signifies an intention to enter into a contract. The language of the 21 August 2001 letter sets out the offer, records instructions to accept the offer, and, by the letter, accepted and communicated acceptance of the offer. In my opinion, a contract was entered into upon receipt by Ilberys of the letter dated 21 August 2001. This is not a contract like the contract entered into by the parties in Masters v Cameron (supra), where the contract was made "subject to the preparation of a formal contract … which shall be acceptable to my solicitors" (which thereby indicated that the solicitors had the right to approve or not approve the formal contract). Nor was it a case of a conditional agreement made "subject to contract" or "subject to deed". A term agreed upon in the contract was that the terms of settlement would be "set out in a deed of settlement". The deed of settlement was to incorporate a confidentiality clause, which means unambiguously that both parties agreed to insert a term obliging the parties to keep the terms of settlement confidential to the parties. The parties therefore agreed that the terms of settlement were to be repeated in the deed, which would almost certainly be "fuller or more precise but not different in effect" (to use the words of Dixon CJ, McTiernan and Kitto JJ in Masters v Cameron (supra)). Hence, the reference in the letter of 21 August 2001 to the fact that the deed would set out the confidentiality clause and the terms of settlement agreed upon "amongst other things". Alternatively, these words made it a Masters v Cameron/Baulkham Hills fourth class case; and see LMI Australasia Pty Ltd v Baulderstone Hornibrook Pty Ltd [2001] NSWSC 886 at [30] and [38].
The offer was clear in its terms that "Westpoint" would have to pay $18,000. This was clearly a reference to Westpoint Corporation Pty Ltd, because it was the employer and only it could make an "eligible termination payment". Wojtowicz Kelly was on the record for Westpoint Corporation Pty Ltd in the Industrial Relations proceedings, and also on the record for Westpoint Constructions Pty Ltd in this action. Mr Sirett would not accept the oral offer until it was approved by Mr Carey, as the managing director of both companies. When he had those instructions, he accepted the offer.
The plaintiff has submitted that the requirement that the parties themselves execute the deed of settlement, means that there is no contract. I disagree. The three parties (Mr Lord and the two companies) entered into a binding agreement, one of the terms of which is that they all promised to bind themselves to execute, in the manner provided in the Property Law Act 1969, a deed recording the terms of settlement.
The fact that there was no agreed time for payment of the $18,000 does not mean that there was no binding contact. A time for payment is not an essential term for a settlement of this kind. In the absence of specific agreement, the payment was due either forthwith or within a reasonable time. That is merely an issue of construction of the contract.
None of the other matters listed by the plaintiff as indicators that there was no intention to reach a binding agreement, lead me to that conclusion. It is true that one of the parties could have asked the Commission to dismiss the application on the basis that the matter had been settled, but one frequently sees parties agreeing to adjourn proceedings when a binding settlement has been reached. The fact that Ms Quai attempted to add to the deed of settlement, a provision relating to "related entities" merely establishes that Ms Quai attempted to persuade the companies to vary the contract. Those efforts failed. The contract entered into on 21 August 2002 remained on foot.
In the Geebung Investments case, Kirby P said that settlement of litigation is generally welcomed and facilitated by courts, and that courts should avoid adopting a re‑interpretation of the facts of an alleged agreement which undoes settlement of litigation. This is particularly so when the two lawyers set out to enter into a contract and state, using the classic language of contract, that an offer has been made and accepted. Courts are the upholders of bargains, and that principle is particularly applicable to the settlement of contentious litigation, and more particularly so in a plain case such as this.
As a result, the preliminary issue is determined in favour of the defendant; that is, I find that:
(a)During the course of discussions between Ms Melissa Quai, on behalf of the defendant, and Mr Shane Sirett, on behalf of the plaintiff and Westpoint Corporation Pty Ltd, the defendant made an offer of settlement in the following terms:
(i)Westpoint Corporation Pty Ltd would pay the defendant the sum of $18,000.00 by way of an eligible termination payment.
(ii)The proceedings in the Supreme Court, including any claim or order for costs, would be compromised by the payment.
(iii)The terms of settlement would be set out in a deed of settlement that would, amongst other things, incorporate a confidentiality clause.
(b)Westpoint Corporation Pty Ltd and the plaintiff accepted the offer by facsimile dated 21 August 2001 sent by Shane Sirett of Wojtowicz Kelly on behalf of Westpoint Corporation Pty Ltd and the plaintiff.
(c)The proceedings herein have been compromised.