Fair Work Act 2009

s.394 - Application for unfair dismissal remedy

Application for an unfair dismissal remedy - Application pursuant to s587 to dismiss the matter on the basis binding settlement reached at conciliation - binding settlement reached -continuing to pursue the matter is frivolous or vexatious and has no reasonable prospects of success - application dismissed.

[1] Mr Adam Smith (the Applicant) lodged an application for a remedy for unfair dismissal on 11 March 2025, alleging he was unfairly dismissed from employment on 19 February 2025.

[2] Aboriginal Community Housing Ltd (the Respondent) filed a Form F3 - Employer Response on 2 April 2025 and objected to the application on the basis that Mr Smith's dismissal was a genuine redundancy.

[3] The matter proceeded to conciliation before a Commission Conciliator on 7 April 2025. The parties agreed on terms to resolve the matter at the conciliation conference and the Commission's Conciliator forwarded written terms of settlement to the parties after the conclusion of the conference. The Respondent then contacted Mr Smith seeking to amend the terms agreed. Mr Smith did not agree to the proposed amendments and viewed the actions of the Respondent as either evidence that it did not consider the matter concluded at conciliation or otherwise as repudiating the agreement, if an agreement was in fact reached. As a consequence, Mr Smith declared himself no longer bound to the terms of settlement and sought to renegotiate the terms or have the matter referred for arbitration.

• [4] On 18 June 2025, the Respondent filed a Form F1 application asking the Commission to dismiss Mr Smith's unfair dismissal application pursuant to section 587 of the Fair Work Act 2009 (the Act). The Respondent asserted that because the parties had reached a binding agreement at conciliation, Mr Smith's unfair dismissal claim had been extinguished and continuing with it had no reasonable prospects of success and was otherwise vexatious.[1] The Respondent also submitted that as the cause of action was extinguished, the Commission has no jurisdiction to deal with the matter.

[5] The Respondent's application was accompanied by a witness statement of Mr Declan McAleese, the legal representative of the Respondent. Mr McAleese gave evidence at the hearing of the matter. The Respondent was represented at the hearing, with permission, by Ms Preston of Counsel.

• [6] The Applicant filed submissions in response to the application to dismiss his claim. Mr Smith argued that the Respondent's attempt to negotiate additional terms in the settlement document after the conciliation conference was evidence of the lack of a binding settlement reached at conciliation. Alternatively, Mr Smith asserted that the Respondent refused to sign the terms of settlement and in doing so repudiated the agreement, if one had existed.[2] Mr Smith argued that the Respondent's repudiation of the terms of settlement entitled him to treat the agreement as not binding on him, leaving him free to pursue his application that he submitted remained validly before the Commission.[3]

[7] The facts in this matter are largely not in dispute and the relevant written communications were submitted in evidence. Discussions between the parties in this matter was, but for the conciliation conference, undertaken in writing. What is in dispute is the effect of the facts on the respective party's legal positions.

[8] The parties were sent a notice of listing by the Commission for a conciliation conference before a Commission conciliator on 7 April 2025. After the conclusion of the conference, the Commission's Conciliator sent a letter to the parties that said as follows:

"I confirm that you reached a settlement agreement and I attach terms of settlement. ... I confirm that the parties have agreed to waive the cooling off period that applied to this agreement."

[9] The attached document was titled "Settlement Agreement". It contained a number of terms that appear to be usual terms that industrial parties include in settlement documents. The document provided for payment by the Respondent to the Applicant of $8,500.00 less applicable taxation within seven days of the Applicant and Respondent signing the agreement. The Applicant was required to discontinue his application after the Respondent had paid the settlement funds. The parties mutually released each other from all current or future claims, actions and liabilities, agreed to keep the terms confidential with some exceptions as set out, and committed not to make disparaging comments about each other.

• [10] On 11 April 2025, the Respondent's legal representative Mr McAleese, sent an email to the Applicant, acknowledging his "patience while we reviewed the terms of settlement." The Respondent's representative then attached two versions of an amended terms of settlement, one with highlighted changes and the other a clean copy, which included what Mr McAleese described as "minor amendments."[4]

[11] The amendments included a reference in the background facts to an allegation made by the Respondent that prior to dismissal the Applicant had emailed confidential information and the Respondent's intellectual property to his personal email address. The amendments also required that the Applicant confirm "he is no longer in possession or control of any confidential information or intellectual property the subject of the alleged confidentiality breach." The edited document proposed to give the Respondent a 'carve out' from its release from claims against the Applicant for matters that had not been brought to its attention prior to the execution of the Settlement Agreement, for fraud or dishonesty of the Applicant, or in the event Mr Smith remained in possession of any confidential information or intellectual property he had obtained during the alleged confidentiality breach. In the email, Mr McAleese submitted to the Applicant that it was reasonable for the Respondent to seek these carve outs from its release because of their concerns about the emails Mr Smith allegedly sent to himself before his dismissal.

[12] Critically, the email from McAleese said: "If you are comfortable with this amendment, please execute the clean version of the terms of settlement and return it to us."

[13] On 16 April 2025, Mr Smith sent an email to the Commission's Conciliator, copying in the Respondent's representatives, complaining that the Respondent had sent him "a significantly amended terms of settlement" including settlement terms that had not been raised in conciliation, was "moving the goal posts" after an agreement had been reached and was "bad faith acting" by failing to include the Conciliator in the email.

[14] Mr Smith sent a further email on 16 April 2025 to the same parties stating that:

(a) the material departure from the terms agreed by the parties "amounts to a repudiation of the original settlement agreement".

(b) he rejected the altered version of the Settlement Agreement.

(c) as the Respondent had failed to execute the original Settlement Agreement and had attempted to amend the Settlement Agreement, Mr Smith no longer considered himself bound by the settlement.

(d) he withdrew his consent to the settlement and advised the Commission he intended to proceed with his matter to arbitration.

[15] Mr Smith then sent a third email on 16 April 2025, to the above parties, again complaining that the Respondent's legal representative had chosen to exclude the Commission's Conciliator from the correspondence seeking to amend the Settlement Agreement, and that as the "settlement was brokered under the Commission's authority ... [the] exclusion raises valid and serious questions about transparency and good faith conduct."

[16] Mr McAleese responded, also on 16 April 2025, advising Mr Smith that the Commission's Conciliator was not a party to the Settlement Agreement, the discussions were confidential and they had not acted in bad faith. In this email Mr McAleese reiterated that Mr Smith was invited to discuss any concerns he had about the proposed amendments and "[if] your position is that you cannot accept the proposed changes, please let us know and we will revert to our client for further instructions."

[17] Later again on 16 April 2025, Mr Smith responded to Mr McAleese saying:

"I write to confirm that I no longer consider myself bound by the settlement terms discussed at conciliation on 7 April, in matter U2025/2913, facilitated by the Fair Work Commission.

As previously stated, the parties reached a clear and binding verbal agreement during conciliation, using the Commission's standard "usual terms of settlement."

I agreed to those terms in good faith and on the understanding that both parties were committed to finalising the matter accordingly.

That agreement should have concluded the matter, with any subsequent communications between us limited to administrative formalities necessary to ratify the terms already settled.

However, your client's subsequent actions - namely, the introduction of new allegations, expanded legal caveats, and a conditional release clause - represent a material departure from what was agreed.

These changes were presented after the fact and without Commission oversight, with the effect of recasting the terms of the negotiated outcome and exposing me to further legal risk.

I consider this a repudiation of the original agreement and a breach of the spirit and intent of the conciliation process.

In light of this conduct, and having now had time to reflect on the approach taken by your client, I formally withdraw my consent to the proposed settlement - including the version agreed at conciliation.

I no longer believe a fair and final resolution can be achieved by agreement.

Accordingly, I request that the matter be relisted for arbitration before the Fair Work Commission."

[18] The Commission's Conciliator responded by email on 17 April 2025 advising that their role in the matter had concluded and referring the parties to the Unfair Dismissals Team at the Commission to seek referral for arbitration. The matter was subsequently allocated to me to deal with the matter.

[19] Mr Smith sent a further email to the Respondent's representative on 22 April 2025 advising the Respondent: "I have carefully reviewed your revised offer and respectfully reject the amendments and, therefore, the agreement at large." Mr Smith then proceeded to make a new settlement offer, setting out two options with different approaches to taxation that were between approximately $20,000.00 and $30,000.00 more than the amount agreed between the parties at conciliation.

[20] On the same day, but not in response to Mr Smith's email, the Respondent's representative sent a letter to Mr Smith that set out the Respondent's position, which can be summarised as follows:

(a) At the conclusion of conciliation, the parties reached an in-principle agreement to resolve the matter which was reflected in the Commission's terms of settlement document.

(b) The agreement reached at conciliation was expressly subject to the finalisation and execution of written terms by both parties.

(c) The subsequent proposed changes to the Commission's Settlement Agreement were made in good faith, were reasonable in the circumstances as they reflected matters raised in the Respondent's response to the unfair dismissal application and did not amount to a repudiation of the in-principle agreement.

(d) The Respondent did not imply that they were unwilling to proceed with the original terms of settlement.

(e) The Respondent's representative had invited Mr Smith to contact them with any concerns.

(f) At no point did the Respondent put the changes to the Settlement Agreement on a "take it or leave it basis".

(g) The Respondent remained committed to resolving the matter and was willing to proceed on the original terms of settlement as provided by the conciliator on 7 April 2025.

(h) Upon receipt of the signed document, the Respondent would sign the Settlement Agreement and pay the settlement funds to Mr Smith.

[21] Mr Smith responded to the letter, referring to his new settlement offer and otherwise rejecting the terms outlined in the Respondent's letter.

[22] The Respondent's representatives sent a reply email on 23 April 2025 confirming that the Respondent rejected Mr Smith's new offer and making clear it was "not willing to compromise on your claim any further than the monetary amounts which were agreed in principle at the conciliation" and noting that any post conciliation conduct has "no bearing on the substantive merits of your application."

• [23] On 24 April 2025, Mr Smith sent an email to the Respondent's representatives setting out his view that the "settlement created a legal contract between your client and me" and that the Respondent's attempts to later alter the terms was a "unilateral effort to retrospectively vary a concluded legal agreement." Mr Smith referred the Respondent to the leading case of Masters v Cameron,[5] an authority from the High Court of Australia that clarified the classes of contractual agreements and the point at which a binding contract is formed. Mr Smith asserted that the agreement between him and the Respondent fell into the first class of agreement:

"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 classes. 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.

In each of the first two cases there is a binding contract: in the first case a contract binding the parties at once to perform the agreed terms whether the contemplated formal document comes into existence or not, and to join (if they have so agreed) in settling and executing the formal document; and in the second case a contract binding the parties to join in bringing the formal contract into existence and then to carry it into execution. Of these two cases the first is the more common."[6]

[24] Mr Smith submitted in his email of 24 April 2025 that "[t]he fact I did not sign the post-conciliation variation has no bearing on the legal effect of the spoken agreement reached and documented by the [Commission]. ... Any attempt to retroactively insert new terms is, on its face, improper and without legal foundation."

[25] The Respondent's representative responded to the Applicant on 24 April 2025 again confirming that it was willing to proceed on the original terms of settlement, being "consistent with your views on the applicability of Masters v Cameron to this matter." The Respondent again invited Mr Smith to execute and return the Settlement Agreement.

[26] On the same afternoon, Mr Smith emailed the Respondent's representative again, confirming that he did not agree to revert to the original Settlement Agreement after the Respondent "unilaterally attempted to alter those terms after the agreement was reached ... that conduct invalidated the agreement, and I no longer consider myself bound by it." He asked the Respondent's representatives to refrain from contacting him unless making a genuine counter-offer or for procedural reasons.

[27] As set out above, the Respondent has made an application to the Commission that Mr Smith's application be dismissed pursuant to section 587 of the Act, that it later refined to a reliance on sections 587(1)(b) and (c).

(1) Without limiting when the FWC may dismiss an application, the FWC may dismiss an application if:

(a) the application is not made in accordance with this Act; or

(c) the application has no reasonable prospects of success.

Note: For another power of the FWC to dismiss an application for a remedy for unfair dismissal made under Division 5 of Part 3‑2, see section 399A.

(2) Despite paragraphs (1)(b) and (c), the FWC must not dismiss an application under section 365, 536LU or 773, or an application under section 527F that does not consist solely of an application for a stop sexual harassment order, on the ground that the application:

[29] The Respondent set out in oral submissions the three propositions that formed the basis of its case:

(a) That there was a binding agreement reached between the parties at the conciliation conference that was recorded by the Commission's Conciliator in the Settlement Agreement. The fundamental terms were agreed at conciliation and the contract was formed during the conciliation conference when the Respondent accepted the Applicant's offer and the Applicant confirmed his agreement to the Commission's standard terms which were later reflected in the Settlement Agreement;

(b) That there was no repudiation of the Settlement Agreement by the post conciliation conduct of the Respondent in requesting Mr Smith agree to proposed variations. Mr Smith was free to reject the Respondent's request, which he did. The Respondent accepted that when its request was rejected, they were bound to the terms of the agreement reached at conciliation;

(c) The Respondent remains willing to adhere to the agreement and has only refrained from paying Mr Smith the settlement sum because he denied an agreement had been reached at all and sought to continue with his unfair dismissal claim.

• [30] The Respondent submits that the terms of the agreement reached at conciliation and set out in the Settlement Agreement prepared by the Commission's Conciliator were clear. The Respondent's Counsel spent time in submissions taking the Commission to the terms of the Settlement Agreement, and the statement of Mr McAleese, setting out in detail the matters raised and discussed at conciliation and pinpointing the time at which they say the contract was formed. The Respondent asserts that the contract was formed at the point of the conciliation conference where the Conciliator conveyed Mr Smith's offer of $8,500.00 and his acceptance of the non-financial terms regarding mutual releases, confidentiality and non-disparagement, contained in the Commission's standard terms of settlement, and the Respondent accepted that offer.[7]

• [31] The Respondent also submits that the mutual waiving of the cooling off period, reflected in the letter sent by the Commission's Conciliator to the parties on 7 April 2025, was evidence that the parties intended to be immediately bound by the terms of the agreement, arguing in its oral submissions that "never has there been a clearer intention of an immediate intention to be bound by the agreement where the three day cooling off period has been agreed to be waived."[8]

[32] The Respondent submitted a binding contract was formed which could be described in legal terms as an accord and satisfaction. It submitted that there had been an accord reached because the Applicant agreed at the conciliation conference that if the Respondent paid him the agreed settlement sum it would resolve his unfair dismissal application and he would no longer pursue the application before the Commission. The Respondent said that there is no satisfaction yet effected in this matter, due only to the Applicant's conduct in subsequently denying that a contract exists and declaring himself no longer bound to any agreement. The Respondent reinforced that it was willing and able to pay the settlement sum and would do so when the outcome of the decision was known and there was certainty for the Respondent about its obligations.

[33] It is submitted by the Respondent that the effect of an accord and satisfaction being reached is that it extinguishes Mr Smith's original cause of action.

• [34] The Respondent says that it proposed variations to the Settlement Agreement after the conciliation that Mr Smith was free to accept or reject. It is the Respondent's case that in requesting Mr Smith agree to amendments it never said, nor inferred, that if Mr Smith rejected the amendments it would not observe the original terms of settlement set out in the Settlement Agreement. The Respondent says it has always been ready and willing to comply with the original terms of settlement and therefore did not repudiate the agreement, as the Applicant asserts. The Respondent submits that the Applicant "sought to capitalise" on the proposed amendments by claiming the Respondent had repudiated the agreement and using the opportunity to declare himself no longer bound by the terms "with a view to extracting himself from that agreement and seeking to negotiate more favourable terms."[9] The Respondent said that Mr Smith "cannot withdraw his consent to the ... agreed settlement and somehow do away with that contract ... that is not consistent with contract law."[10]

• [35] Mr Smith argues that "as a matter of contract law and legal principle, no concluded and enforceable agreement was reached" between the parties at the conciliation conference.[11] Mr Smith put to the Commission that there were terms agreed to resolve the matter at conciliation but once the Respondent sought to vary the terms post conciliation they had repudiated the agreement and therefore it was not binding. Mr Smith submits that the Respondent's post conciliation conduct in seeking amendments to the Settlement Agreement "fatally undermine[d] its position that a binding agreement was formed."[12] The following exchange occurred at the hearing in respect of this issue:

"Commissioner: So it is that you agree that terms were agreed at the conciliation that were reflected in the document sent to you by the conciliator and your case is predominantly about the post conciliation conduct and what you say is the effect of that conduct on the binding terms reached at conciliation? Is that a correct characterisation of your case?

• [36] Mr Smith submitted that in offering the Applicant the option to execute the amended Settlement Agreement if he was "comfortable" with it was "unambiguous language of proposal - not confirmation. It is conduct that plainly admits the agreement was still open to amendment and negotiation. ... This conduct exposes an untenable inconsistency. If the Respondent considered the agreement concluded, it had no legal basis to seek unilateral material amendments. ... If it believed further negotiation was necessary, then by its own conduct it demonstrate[d] there was no final binding agreement."[14] Mr Smith submitted "[l]egally, that amounts to repudiation."[15]

• [37] Mr Smith agrees that he told the Respondent he would not proceed to sign the Settlement Agreement but that "came after the Respondent changed the terms. I was responding to their breach not initiating one. ... Any comment I made about being in breach or not liking the new terms was a direct response to the fact that the original terms had been changed. I was not walking away from the agreement, I was walking away from the altered version [of the Settlement Agreement] they created ... so legally, the first party to deviate from the agreed terms is a repudiating party, and that was the Respondent, not me."[16]

• [38] This aspect of Mr Smith's argument was predicated on his repeated assertion that the Respondent had changed the terms of the agreement and in doing so made it clear that they did not consider the negotiation concluded at the conciliation conference and "they themselves did not believe the deal was done".[17]

• [39] In respect of his position that following the Respondent's repudiation, Mr Smith was entitled to withdraw from the agreement because the Respondent had changed the terms and they were no longer acceptable to him, Mr Smith explained: "I withdrew because the Respondent departed from the process and from the terms we discussed, so ... no binding settlement was created because the circulating agreement was never executed and the terms no longer reflected the discussion at conciliation. That's my key point ... [S]o I formally advised that I consider the agreement void due to their conduct."[18]

[40] I understand that Mr Smith's submission that the Respondent repudiated the agreement post conciliation is a submission in the alternative to the one made that no binding agreement had been reached at all in conciliation.

[41] In my view, the evidence is clear that there was a binding agreement between the parties, reached at the conciliation conference and reflected in the Settlement Agreement produced by the Commission's Conciliator. The Commission's Conciliator communicated their view in writing that a settlement agreement had been reached during the conciliation and sent a copy of the Settlement Agreement reflecting the agreed terms to the parties on 7 April 2025.

• [42] Mr Smith's correspondence to the Respondent between 16 and 24 April 2025 indicates that he understood the matter had been resolved on agreed terms as he referred to the outcome of the conference as an agreed resolution, a legally agreed outcome,[19] terms agreed[20], a "clear and binding verbal agreement during conciliation, using the Commission's standard "usual terms of settlement"[21] and in reference to the Settlement Agreement produced by the Commission a "settlement [that] created a legal contract between your client and me"[22]. Further, Mr Smith unequivocally rejected the proposed amendments to the terms of settlement proposed by the Respondent on the basis that the "changes constitute a material departure from the terms agreed between the parties"[23] and accused the Respondent of "unilaterally attempt[ing] to alter [the original] terms after the agreement was reached and the cooling-off period waived."[24]

• [43] Any doubt that the Applicant considered himself bound to the agreement terms reached at the conciliation conference is removed by his subsequent statements that he no longer considered himself bound to the agreement. The language used by Mr Smith in his correspondences leaves no doubt that he previously considered himself bound and was now resiling from that position.[25] It is convenient for Mr Smith to now assert in his submissions defending this application that no binding agreement was reached between the parties.

• [44] Objectively considering the evidence of Mr McAleese and the written communications between the parties, which the Applicant agreed speak for themselves,[26] it is clear that an agreement was reached at the conciliation conference that I consider to be in the second class of agreements addressed in Masters v Cameron. I have formed this view because the evidence, in particular the correspondence from the Commission's conciliator and the Settlement Agreement subsequently produced, make it clear that all the terms of the bargain were agreed but the payment of the settlement sum was conditional upon the Applicant executing the Settlement Agreement. The parties clearly intended not to depart from or add to the agreed terms because all of the terms were agreed and set out and the cooling off period was waived with the agreement of both of the parties. I agree with the Respondents submission that the waiving of the cooling off period is further objective evidence that the parties reached a binding agreement at the conciliation conference.

• [45] Additionally, the elements necessary to form a contract were present in this matter: the Applicant made an offer that was accepted by the Respondent,[27] the Respondent agreed to pay Mr Smith consideration for concluding his unfair dismissal claim and giving the Respondent a release from other claims, the parties intended for the agreement to be legally binding, the terms were sufficiently certain and set out verbally and then in writing by the Commission's Conciliator.

• [46] I agree with the Respondent that an accord has been reached in this matter and the satisfaction has not occurred in actual terms only because the Applicant disputed the existence of a binding contract. The legal term 'accord and satisfaction' was described by Justice Gummow of the High Court of Australia in Thompson v Australian Capital Television[28] in the following way:

"Accord and satisfaction (the former being the agreement or consent to accept the latter) requires acceptance of something in place of the full remedy to which the recipient is entitled, coupled with provision of the consideration agreed upon."[29]

• [47] The significance of an accord and satisfaction was enunciated by the Federal Court of Australia in the matter of Australian Postal Corporation v Gorman and Another[30] (Gorman), wherein His Honour Justice Besanko held:

"An accord and satisfaction extinguishes the existing cause of action and replaces it with a new cause of action based on the agreement. A valid accord and satisfaction is not a discretionary factor relevant to the subsequent litigation of the original claim; it is an answer to the claim."[31]

[48] Once the Respondent makes payment to the Applicant of the settlement sum agreed at conciliation, Mr Smith's unfair dismissal claim is concluded. Any cause of action available to him is only one that arises from the terms of the Settlement Agreement.

[49] Whilst the Respondent repeatedly (and correctly) asserted in their application to dismiss the matter that a binding agreement was reached at the conciliation conference, I am not surprised their approach following the conciliation conference caused the Applicant upset. In the email of 11 April 2025, the Respondent's representative noted that it had been taking time to review the terms of settlement. This language is not reflective of the Respondent considering the terms finalised, agreed and binding.

[50] The Respondent then proposed amendments to the Settlement Agreement that they have minimised in describing as minor. The changes proposed were a significant shift from the mutual releases agreed and reflected in the Settlement Agreement. The qualified releases proposed could have opened the door for the Respondent to pursue potential causes of action against the Applicant arising from conduct during his employment. I understand why this proposal was unsatisfactory to the Applicant.

[51] The proposed changes to the Settlement Agreement were poorly timed and to avoid the confusion that followed, the terms sought by the Respondent ought to have been put in conciliation, so they could have been considered by the Applicant and factored into his acceptance of any settlement proposals.

• [52] However, it is evident to me that the Respondent only put forward the amendments to the Settlement Agreement as a proposed variation that could be accepted or rejected by Mr Smith. I accept that the Respondent did not propose the amendments on a "take it or leave it basis"[32] or do anything that could have led the Applicant to understand that should he reject the proposed amendments, the Respondent would not have observed the agreement reached at the conciliation. The Respondent made it clear to Mr Smith that he could sign the amended terms of settlement if he felt comfortable and that he was welcome to contact Mr McAleese to discuss the proposal further. Once Mr Smith vehemently objected to the suggested amendments and the manner in which they were put to him, the Respondent's representative made it unequivocally clear to Mr Smith that should he reject the amendments, the Respondent considered itself bound to the agreement reached at conciliation and reflected in the Settlement Agreement. This was clearly put to Mr Smith in written correspondence by the Respondent's representative on 22 April 2025.

[53] There is an inconsistency in Mr Smith's submissions that on one hand the Respondent was continuing to negotiate the settlement and did not consider it finalised when they sought an amendment to the terms and his other submission that they made unilateral changes to the agreed terms which entitled him to deem himself no longer bound to the terms agreed.

[54] I do not accept Mr Smith's submission that in seeking that the binding agreement be amended, with Mr Smith's consent, that it consequently accepted there was no binding agreement previously reached at conciliation. Mr Smith has elevated the Respondent's conduct to a repudiation when it was actually no more than seeking an amendment with the other party's consent. I also reject Mr Smith's repeated submissions that the Respondent made unilateral changes to the Settlement Agreement and therefore repudiated it. The Respondent did not make any changes to the Settlement Agreement. It only proposed amendments that were ultimately rejected by the Applicant.

[55] Neither the Respondent's words nor conduct, objectively considered, conveyed to Mr Smith that it did not consider itself bound to the terms of settlement agreed at conciliation. There was no repudiation of the Settlement Agreement by the Respondent. I accept the Respondent only sought a variation that Mr Smith could have rejected and the settlement could have progressed as agreed. Instead, Mr Smith subjectively deemed the request for a variation as a repudiation by the Respondent and used the opportunity to try to renegotiate the terms of settlement. Just as it is open to the Applicant to refuse the variation proposed by the Respondent and proceed with the Settlement Agreement, it is likewise open to the Respondent to refuse the further settlement offers of the Applicant and proceed to finalise the settlement in accordance with the Settlement Agreement.

[56] There was no repudiation of the Settlement Agreement by the Respondent.

Settlement Agreement remains binding on both parties

[57] As the Settlement Agreement was binding on the parties, neither party was open to resile from it. Once the Respondent's proposed amendments were rejected by the Applicant the Respondent was bound to the terms of the Settlement Agreement. Likewise was the Applicant.

[58] Mr Smith was wrong to determine that the Settlement Agreement was no longer binding on him such that he could re-negotiate terms more favourable to him. I accept that Mr Smith could propose amendments to the terms of settlement, including the settlement sum, after an agreement was reached, just as the Respondent had done in this case. But when the increased settlement sums were rejected by the Respondent, the settlement terms reached at conciliation remained binding on both of the parties. I note that in this case, the additional settlement sums were not put to the Respondent as amendments to the terms of settlement, but rather new offers of settlement after Mr Smith declared himself no longer bound to the terms previously agreed. Irrespective, the Settlement Agreement was binding on both of the parties, after they rejected each other's proposed changes to the terms agreed for the reasons set out above.

[59] The Settlement Agreement sent to the parties by the Commission's Conciliator on 7 April 2025 contain the terms of the settlement that remain binding on both parties.

Conclusion and dismissal of matter pursuant to section 587 of the Act

[60] In summary, I find as a matter of fact that there was a binding agreement reached between the parties at the conciliation conference. A contract was formed when the Respondent accepted the terms offered by the Applicant which included the broader terms of the settlement regarding confidentiality, releases and mutual non-disparagement. There is an accord and promise of satisfaction reached in this matter. The settlement terms agreed in the conciliation conference formed a binding contract in the second class of contract set out in Masters v Cameron. The Settlement Agreement was the reduction to writing of all the terms of the bargain agreed verbally in conciliation, from which the parties intended no departure. However, the payment of the settlement sum by the Respondent to the Applicant was conditional upon both parties signing the Settlement Agreement.

[61] I further find that the Respondent did not repudiate the Settlement Agreement by proposing amendments that were subsequently rejected by the Applicant. There is no evidence that establishes the Respondent intended not to be bound by the Settlement Agreement if the Applicant rejected the proposed amendments. Consequently, it was not open to the Applicant to withdraw his consent to the binding settlement agreement. The parties remain bound to the terms as set out in the Settlement Agreement.

[62] Consequently, Mr Smith's unfair dismissal application must be dismissed. His unfair dismissal claim has been resolved on agreed terms. In determining that the Applicant's unfair dismissal claim must be dismissed, I follow the reasoning of Besanko J in Gorman:

"[T]he words of s 587(1) are wide enough to include the recognition of an accord and satisfaction. As I have said, a valid and effective accord and satisfaction extinguishes the pre-existing cause of action and continued pursuit of an application based on such cause of action is clearly capable of being considered to be frivolous or vexatious or without reasonable prospects of success."[33]

• [63] I have taken into account in reaching this decision, the undertaking given by the Respondent to the Commission in the hearing[34] that should the Commission find that there was a binding agreement reached between the parties and determine to dismiss the Applicant's claim, it will transfer the settlement sum to the Applicant, regardless of whether he signs the Settlement Agreement. The Respondent submitted that a decision dismissing the matter will provide the Respondent with the certainty it otherwise sought by having the Applicant sign the Settlement Agreement.

[64] Despite the Settlement Agreement that continues to bind the parties, the Applicant purported to resile from the agreement and proceed with his unfair dismissal claim. That cause of action will be extinguished by the accord reached that was subsequently reduced to writing and the satisfaction that will be imminently implemented by the Respondent. Mr Smith continuing to pursue a cause of action that has finalised with a binding agreement and which will be imminently extinguished, is frivolous or vexatious and his application has no reasonable prospects of success. I therefore determine to dismiss the Applicant's unfair dismissal claim.

• [65] I note the submissions of Mr Smith that his substantive claim is not frivolous or vexatious and that seeking a "fair hearing after a failed settlement is not being vexatious."[35] The finding is that the efforts to continue with the application after a binding settlement has concluded the matter is frivolous or vexatious and without reasonable prospects of success. For the reasons set out, the settlement reached in this matter was not a failed settlement. This decision does not engage with the merits of Mr Smith's substantive claim.

• [66] An order[36] dismissing the Applicant's unfair dismissal claim pursuant to section 587(1)(b) and (c) of the Act will be published concurrently with this decision.

R Preston instructed by D McAleese of Hall & Wilcox with permission, on behalf of Aboriginal Community Housing Ltd.

[1] Submissions of Respondent at paragraphs 10 and 11.

[2] Submissions of the Applicant at page 2.

[4] Email from Mr McAleese to Applicant at 1:29pm on 11 April 2025.

[5] (1954) 91 CLR 353.

[6] Ibid at 360. The Supreme Court of New South Wales in the case of Baulkham Hills Private Hospital Pty Ltd v GR Securities Pty Ltd (1986) 40 NSWLR 622 identified a fourth class of agreement to those identified in Masters v Cameron where the parties intend to be bound but agree to make a formal contract containing additional terms in substitution for the first contract.

[7] See statement of Mr McAleese at paragraph 3.4(g) - (i).

[8] Audio recording of the hearing at 32:11.

[9] Submissions of the Respondent at paragraph 6.

[10] Audio recording of the hearing at 42:50.

[11] Submissions of the Applicant at page 1.

[13] Audio recording of the hearing at 1:31:05 - 1:31:37.

[14] Submissions of the Applicant at pages 1 - 2, and audio recording of hearing at 2:03:46.

[19] Email of Applicant at 2:07pm 16 April 2025.

[20] Email of the Applicant on 16 April 2025 (no time stamp is provided).

[21] Email of the Applicant at 8:39pm on 16 April 2025.

[22] Email of the Applicant at 11:03am on 24 April 2025.

[23] Email of the Applicant on 16 April 2025 (no time stamp is provided).

[24] Email of the Applicant on 24 April 2025 at 4:11pm.

[25] See also Sullivan v Australia Post Group T/A Australia Post Corporation [2024] FWC 3480 at [27].

[26] Audio recording of the hearing at 13:18 - 13:26.

[27] Statement of Mr McAleese at paragraph 3.4 (h) - (j).

[28] [1996] HCA 38; (1996) 186 CLR 574.

[30] [2011] FCA 975; (2011) 282 ALR 561.

[32] See letter from Respondent to Applicant of 22 April 2025.

[33] [2011] FCA 975; (2011) 282 ALR 561 at [33].

[34] Audio recording of the hearing at 26:22 - 26:42.

[36] PR798367.

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