Yun Zhong Xie v CB Ideal Tapware Pty Ltd
[2023] FWC 1674
•11 JULY 2023
| [2023] FWC 1674 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.394—Unfair dismissal
Yun Zhong Xie
v
CB Ideal Tapware Pty Ltd
(U2023/2211)
| DEPUTY PRESIDENT ANDERSON | ADELAIDE, 11 JULY 2023 |
Application for an unfair dismissal remedy – fabricator – strike out application – whether binding settlement agreement exists – no concluded bargain – strike out application dismissed
On 23 June 2023 the respondent employer made a strike out application. The strike out application is grounded on the proposition that a binding settlement agreement existed when the respondent through its solicitors accepted the terms of a settlement deed on 1 June 2023 following earlier conciliation before a Member of the Commission.
After conducting a hearing of the strike out application on 29 June 2023, a decision was reserved.
On 6 July 2023 I made an interim decision.[1]After settling out the facts and relevant legal principles, I determined (for reasons set out at [60] to [72]) to direct further Member Assisted Conciliation in advance of finally determining the strike out application.
The further Member Assisted Conciliation was conducted by Commissioner Platt on 10 July 2023.
The matter did not resolve and the file was returned to my chambers.
I now proceed to determine the strike out application.
The facts are set out in the interim decision (at [20] to [47]), as are the legal principles (at [55] to [59]) and a summary of submissions (at [48] to [53]). They need not be repeated.
Consideration
For the following reasons, I do not conclude that a binding settlement agreement exists between the parties.
Whilst I find that Mr Xie offered to settle his unfair dismissal claim for an agreed sum at the conclusion of the 25 May 2023 conciliation before Commissioner Platt, no settlement was reached at that time. This was for two reasons. Firstly, the employer did not agree at that time. It simply agreed to consider the proposal over a seven day period during which the offer would remain on the table. Secondly, the terms attached to Mr Xie’s offer as reflected in the settlement deed sent to the parties immediately following the conciliation were the Commission’s standard terms of settlement and were prepared by the Commission and not Mr Xie. In their entirely, these had not been agreed by Mr Xie at the time he offered to settle for a specified quantum.
Mr Xie’s conduct following conciliation supports this finding. Mr Xie was asked via the 25 May 2023 email from the Commissioner’s associate to sign and return the deed. He did not do so. Five days later (30 May 2023) Mr Xie sent the Commissioner’s chambers an email which questioned the release clauses in the deed and sought an explanation of them.
By this conduct, it can be safely concluded that not all of the terms of the draft settlement deed prepared by the Commission following conciliation reflected the terms on which Mr Xie was willing to settle the matter. On quantum they did. On release terms they did not. Mr Xie did not intend to contract a settlement on the terms of the deed in its entirety and he did not, by conduct objectively assessed, act to that effect.
This is not a case of buyer’s remorse. Mr Xie did not change his mind on the deed. He first saw the release terms in the deed when he read the deed after being sent it by the Commissioner’s chambers. He had concerns about them. He communicated those concerns to the Commission. It is for this reason that no deed was signed by Mr Xie.
It is regrettable that Mr Xie did not, as was his responsibility, copy in the respondent employer to his email to the Commissioner on 30 May 2023. Had he done so it would have been readily apparent to the respondent that the deed in its entirety did not reflect his offer.
The consequence of Mr Xie not doing so meant that the employer in good faith accepted the offer in the terms of the Commission’s deed on the late afternoon of the final day the offer was on the table (1 June).
However, what the employer accepted on 1 June 2023 was the Commission’s deed. That deed purported to be the applicant’s offer but was not in fact the applicant’s offer. It included the settlement sum offered by the applicant but contained terms yet to be agreed by the applicant.
For a binding settlement agreement to exist, there needs to be a relevant meeting of minds on contractual terms. As the Commission’s terms which attached to the settlement sum had not been agreed by Mr Xie when he offered to settle for that sum, they were incapable of forming a contract that represented a mutual meeting of minds.
Nor do I find that the release terms objected to by Mr Xie were so minor or incidental to the offer that they cannot reasonably be said to relevantly preclude a finding of a binding settlement agreement. Release terms are fundamental terms of a settlement contract. They reflect the legal rights (if any) that are agreed to be cast aside and/or retained in return for the primary settlement terms (such as a settlement sum). They represent an integral part of the bargain.
In making this finding I observe that the respondent employer believed in good faith that its acceptance of the Commission deed on 1 June 2023 was the conclusion of a settlement bargain. It had good reasons for believing so. It had not been advised by Mr Xie nor the Commission of his disagreement with the release terms; a disagreement that had been notified to the Commission forty-eight hours earlier via Mr Xie’s 30 May 2023 email.
It is clearly evident the employer did not become aware of the 30 May 2023 email by Mr Xie to the Commission until Mr Xie made reference to it three weeks later in his email to the employer’s solicitors on 22 June 2023.
I observe that the email accompanying the Commission deed on 25 May 2023 could have been drafted more carefully. The reference to “this Deed contains the final offer put by the Applicant to the Respondent, it has not yet been agreed on” is ambiguous. It was reasonably open to the respondent employer to interpret this as a reference to the fact that it (the employer) had not yet agreed to the deed but that Mr Xie had. In fact, he had not. It is also open to a construction that the deed was yet to be agreed by either party.
As regrettable as these missteps and errors were, it is not open on an objective consideration of the evidence to make a finding that the deed agreed by the employer on 1 June 2023 and signed by an officer of the employer on 9 June 2023 was a contract in the form of a binding settlement agreement that represented a meeting of the minds between Mr Xie and CB Ideal Tapware Pty Ltd on the terms of settlement.
Conclusion
As no binding settlement agreement exists, the unfair dismissal application remains before the Commission. The employer’s strike out application is dismissed. An order to that effect is issued in conjunction with publication of this decision.[2]
As the unfair dismissal application was not resolved consequent on the further conciliation conducted on 10 July 2023, it will proceed to hearing and determination.
I will list the matter for further directions.
At the further directions hearing I will consider fresh dates for hearing, set dates for the filing of further materials and consider the objections made by Mr Xie to the production order of 26 June 2023. That order currently remains suspended.
I make one concluding observation as to costs. In dismissing the strike out application, it follows that the employer’s application for costs associated with the strike out application is also dismissed. However, in doing so I clearly indicate that this decision does not preclude a party applying for costs at a later stage in proceedings, even in respect of conduct that is the subject of this decision. Under the FW Act, costs can be ordered against a party because of an unreasonable act or omission by that party in connection with the conduct or continuation of a matter (s 400A FW Act) or on the grounds that applications are vexatious or have no reasonable prospects of success (s 611).
In this decision I have simply made a finding as to whether a binding settlement agreement existed. I have made no finding as to the reasonableness of the conduct of the parties in either proposing or objecting to release terms in a settlement deed, or in making or opposing the unfair dismissal application generally.
DEPUTY PRESIDENT
Appearances:
Ms E Theodre with Mr J Spartalis with permission on behalf of CB Ideal Tapware Pty Ltd
Mr Y Xie on his own behalf
Hearing details:
Adelaide (by video)
29 June
[1] [2023] FWC 1641
[2] PR764101
Printed by authority of the Commonwealth Government Printer
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