Benjamin Falconer v Fire and Rescue NSW

Fire & Rescue NSW

1. The Respondent relied upon a statement of Mr Graeme Holland, Senior Industrial Relations Officer dated 1 May 2020 (Exhibit R1) and Mr John Andeallo, Senior Strategist (Exhibit R2).
2. Mr Holland's affidavit simply stated that the Respondent was seeking orders that that matter be dismissed or permanently stayed, that he had prepared the Notice of Motion seeking those order and annexed the stated of Mr Andreallo. Mr Andreallo's statement sets out the history of the proceedings and attaches the email correspondence between the parties as a part of the negotiation process. Mr Andreallo stated that there were a number of variations proposed by the FBEU that were accepted and those that were not were not pursued. Further, a specific change to the non-disparagement clause was requested by the FBEU that was accepted by the Respondent.
3. The Respondent filed written submissions dated 16 April 2020 and 15 May 2020. In summary, the Respondent submitted that a binding agreement was reached between the parties on 24 January 2020 or at the latest on 7 February 2020 and is a complete bar to the Applicant pursuing his unfair dismissal claim.
4. Both parties relied upon Masters v Cameron (1954) 91 CLR 353 in which Dixon CJ, McTiernan and Kitto JJ stated at p 360: "Where parties who have been in negotiation reach agreement upon terms of a contractual nature and also agree that the matter of their negotiation shall be dealt with by a formal contract, the case may belong to any of three cases. It may be one in which the parties have reached finality in arranging all 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. Or, secondly, it may be a case in which the parties have completely agreed upon all the terms of their bargain and intend no departure from or addition to that which 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. Or, thirdly, the case may be one in which the intention of the parties is not to make a concluded bargain at all, unless and until they execute a formal contract." (emphasis added)
5. The Respondent contended that the parties had reached an agreement on 24 January 2020 which falls within the second category in Masters v Cameron and it would not do justice between the parties to permit the Applicant to renege on the agreement negotiated on his behalf by his Union and understood by him.

The Applicant

1. The Applicant relied upon a statement filed on 8 May 2020 (Exhibit A1). The Applicant gave evidence at [5]-[12] of Exhibit A1: "On 24 January 2020 I reached an in principle agreement with the respondent that I would receive $10,000, that my termination would change to a resignation and be reflected as such in the published Commissioner's orders, and that I would get a transcript of my training and my statement of service. I understood that this agreement was based on there being a deed of release that I was happy with. I understood that if I was not happy with the deed of release, that the deal fell over. Anastasia from the FBEU was to negotiate a suitable deed of release. I received the first version of the deed and had immediate concerns that it was not suitable. My concerns were to do with the fact that I wanted to be sure I could talk about my time as a firefighter freely. I did not want to talk about events surrounding my termination. I also wanted to make sure that I was not prevented from taking action about workers compensation or other matters that didn't relate to my termination. I did not have any action in mind, but I wanted to preserve any legal rights I may have against the respondent. On 7 February 2020 I received last proposed deed of release. Annexed and marked with the letter A is this deed. Once I receive this final copy, I took this deed to my solicitor. On 6 March 2020 after talking to my solicitor, I made the decision that I would not sign the deed. She told me that it would prevent me from taking any other action against the respondent and that I would not be able to freely talk about my time as a firefighter. Given that I could not sign the deed as it was, I understood that the settlement had fallen through."
2. The Applicant's filed written submission on 8 May 2020 and addressed the Commission on his case at the hearing of the matter.
3. In short, the Applicant submitted that an in-principle agreement only was reached on 24 January 2020 and the parties did not intend to be bound by the agreement in the absence of an executed deed. The Applicant contended that the agreement reached on 24 January 2020 fitted into the third category envisaged by Masters v Cameron, and that there was a mutual intention not to be bound by the agreement until the deed of release was executed by the parties. The Applicant referred the Commission to the matter of Cohen v Morgans [2019] NSWSC 1634 which is considered below.
4. Accordingly, the Applicant submitted that the Respondent's Notice of Motion should be dismissed and that that the unfair dismissal matter be listed for further directions.

Consideration

1. The question before the Commission is whether a binding agreement was made between the parties on 24 January 2020 and, if so, whether there is any reason why the Commission should not give effect to it. The question turns ultimately upon the Commission's determination of the parties' objectively ascertained common intention.
2. Both parties relied on Masters v Cameron as referred to above.
3. The Respondent submitted that the negotiated settlement fell into category two as recognised in Masters v Cameron. The Applicant submitted that the case falls into the third category.
4. I agree with the Respondent that the agreement on 24 January 2020 falls into the second category.
5. There was no evidence before the Commission to give any context to the discussions that led to the in-principle settlement, except for the email of Mr Polities of 24 January 2020. Although the Applicant gave evidence with respect to his understanding of the meaning of the in-principle settlement, this is of little assistance to the Commission in determining the nature or category of agreement that had been reached. The Respondent was entitled to rely upon the representations made by his representative during the course of the negotiation process. It is the communications between Mr Andreallo and Ms Polities that are most relevant to the analysis of the category of agreement reached by the parties.
6. The statement by Ms Polities that the in-principle agreement was "also subject to a satisfactory deed of release" in the email of 24 January 2020 is not a sufficient basis to find that the parties did not intend to be bound to the agreement they had struck. The conclusion that the parties did intent to be bound by the agreement is supported by the language used in the email that, "I confirm we have reached the following agreement in principle".
7. The Applicant argued that the word "also" in the final sentence of the 24 January 2020 email, "This agreement is also subject to a satisfactory deed of release" was important because the contents of the Deed were important to the Applicant. However, there is no evidence of this being conveyed to the Respondent. I disagree the use of the word "also" evidenced that the parties did not intend to be bound by the agreement if the terms of the deed could not be agreed.
8. The Applicant referred the Commission to the matter of Cohen v Morgans [2019] NSWSC 1634. In this matter, Ward CJ found that there was no intention for the parties to create a binding agreement in the context of a negotiation settlement, that is, the agreement was in the third Masters v Cameron category. However, the facts of that case were materials different to the one at hand. In particular, in that matter it was found at [165]: "Further, in my opinion, the text of the Second 9 August Letter points strongly against there having been an intention on the part of both parties immediately to be bound by acceptance of that proposal (even assuming for the moment that its terms were incorporated in some fashion in the counter-offer; and in this regard Mr Cohen emphasises that many of the clauses in the draft deeds are reflective of the conditions of the Second 9 August Letter). Apart from the operative clauses that, as Mrs Morgans says, turn on the execution of a deed, the most telling to my mind is the very clear statement in that letter that, if agreement is not reached on the wording of the deed, then the dispute "will not be resolved"."
9. There is no such clear statement pointing stongly against there having been an intention on the part of both parties immediately to be bound by in-principle agreement in the email of 24 January 2020. To the contrary, it is not at all clear from the email of 24 January 2020 that there is a mutual intention that the parties will not be bound until the terms of the deed are agreed. If it was the Applicant's intention that the parties would not be bound by the in-principle agreement if the terms of the deed could not be agreed, this could have been clearly stated in the email. But it was not.
10. There was no evidence of Ms Polities informing the Respondent that the Applicant would not agree to any non-disparagement clause during the course of the negotiations relating to the deed. Indeed, Mr Polities requested changes to the non-disparagement clause that were accepted by the Respondent and incorporated into the final draft deed forwarded to the Applicant. Specifically, there was agreement in respect of the terms of the non-disparagement clause Mr Falconer complains about on 7 February 2020 when Ms Polities stated in her email to Mr Andreallo, "All changes are acceptable, except Mr Falconer is concerned that the deed does not explicitly exclude workers comp."
11. I find that on 24 January 2020 the parties entered into a binding agreement as to the terms on which these proceedings were to be resolved. This is not inconsistent with the Applicant's evidence that he understood that that if he was not happy with the deed, "the deal fell over", because there was no evidence of this being communicated to the Respondent.
12. In Dr Payne v The University of Sydney & Anor [2000] NSWIRComm 102 Schmidt J stated as follows: "94. The Court cannot overlook the important public interest in parties adhering to the bargains which they make in settlement of [proceedings] which they have brought, thereby bringing litigation to an end. This must especially be the case when one side of the bargain has acted in accordance with the agreement reached and the other has benefited as a result. That was plainly the case here, where Dr Payne himself sought payment of long service leave in advance in accordance with that agreement, before he sought to repudiate it. Here, it cannot be overlooked that the bargain was made during a second attempt at conciliation before the Court, in circumstances where the matter was otherwise listed for hearing, where the all parties were legally represented and where the Court was informed of the settlement reached and then also acted in accordance with that advice." (Emphasis added)
13. Although the Applicant was not legally represented in these proceedings, he had the benefit of representation by his union, who is very experienced in negotiating settlement of unfair dismissal matters before the Commission.
14. The Commissions finding in this matter are consistent with the emphasis in the Act on the Commission attempting to resolve industrial disputes by conciliation. This is one of the objects of the Act: see s 3(g). It would undermine the clear legislative intention of the Act to permit a party, without proper reason, to walk away from a settlement reached in conciliation.
15. It follows that, it is not in the interests of justice and contrary to the objects and intention of the Act to allow the Applicant to walk away from the agreement that was reached on 24 January 2020.
16. The Respondent has requested that the proceedings be dismissed or permanently stayed. Having regard to s 87(1) and s 162(2)(h) of the Act, I consider that the appropriate course is for the proceedings to be permanently stayed.
17. Order
18. I order the permanent stay of these proceedings. Janine Webster Commissioner

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