Fair Work Act 2009

s.394 - Application for unfair dismissal remedy

Australia Post Group T/A Australia Post Corporation

Application for an unfair dismissal remedy - whether binding settlement reached application - found that binding settlement reached - dismissed pursuant to s 587

• [1] On 30 July 2024, Mr John Sullivan (the Applicant) lodged an application pursuant to s 394 of the Fair Work Act 2009 (Cth) (the Act) in which he asserts that the termination of his employment with Australia Post Group T/A Australia Post (the Respondent) was unfair.

• [2] The matter was allocated to my Chambers on 12 September 2024 for determination. Following allocation of the matter, directions were sent to the parties on 12 September 2024 for the filing of materials. The matter was listed for a conference/mention on 25 September 2024 and a hearing was listed for 11 November 2024.

• [3] At 5.45pm on 8 November 2024, the Respondent's representative emailed my Chambers advising that the parties had reached an in-principle agreement to resolve the matter and requested that the hearing listed for 11 November 2024 be adjourned to allow the settlement to be finalised. The hearing was vacated. The Applicant subsequently advised my Chambers on 13 November 2024 that the Deed of Settlement (Deed) was not executed, that the matter was not settled and that he wished to proceed to have his application arbitrated.

• [4] On 18 November 2024, the Respondent's representative wrote to my Chambers and advised that, notwithstanding that no settlement agreement had been signed, the Respondent's position was that a binding settlement agreement was reached on 8 November 2024. The Respondent submitted that the matter should be dismissed under s 587(1) of the Act on the basis that the binding settlement of 'accord and satisfaction' extinguished the existing cause of action. New directions were issued by my Chambers providing for the filing of material by each party in relation to the Respondent's application for the dismissal of the Applicant's unfair dismissal application. A hearing to deal with the s 587 application was listed for 9 December 2024.

• [5] Both parties filed material in accordance with the new directions. The Applicant appeared on his own behalf while Mr Will Spargo of Lander and Rogers appeared on behalf of the Respondent pursuant to s 596(2) of the Act.

• [6] At 3.28pm on 7 November 2024, Ms Jessica Miral of Lander and Rogers wrote to the Applicant on behalf of the Respondent and put forward an offer to resolve the matter. The offer, which she stated would remain available until 5.00pm on Friday 8 November 2024, was as follows;

• is made on the basis that Australia Post will pay you four weeks' wages, being the amount you would have received if you received payment in lieu of notice;

• is made by Australia Post without admission of liability;

• is made without prejudice except as to costs, in accordance with the principles set out in Calderbank v Calderbank [1975] 3 All ER 333 and adopted in the Court of Appeal decision in Hazeldene's Chicken Farm Pty Ltd v WVA (No. 2) [2005] VSCA 298;

• is subject to the execution of a settlement and release agreement to be drafted by us; and

• remains open for written acceptance until by 5pm on Friday 8 November 2024.

• [7] At 8.23pm on 7 November 2024, the Applicant responded to Ms Miral and rejected the offer in the following terms;

I am writing to formally reject your settlement offer of 4 weeks wages.

While I appreciate your attempt to resolve this matter, I believe the offer does not adequately compensate for an unfair dismissal. I am willing to see this matter through to public hearing.

Furthermore term word harassment is defined as a 'pattern of behaviour' whereas my conduct was a once off and lasted ~5seconds.

In light of the above, I am proposing a counteroffer of 13 weeks wages. I believe this amount is fair and reasonable.

This amount takes into account the economic impact of the unfair dismissal, and considers 65% of my income support payments attributed to rent.

I am open to further negotiation and hope we can reach a mutually agreeable settlement.

• [8] At 2.56pm on 8 November 2024, Ms Miral responded to the Applicant's email of 7 November 2024 and in doing so rejected the Applicant's counterproposal in the following terms;

Thank you for your email. We advise that your counteroffer is rejected.

We are instructed that the terms of Australia Post's offer, and the amount of the settlement payment, are not open for negotiation.

• [9] At 4.20pm on 8 November 2024, the Applicant responded to Ms Miral in the following terms;

I attempted to call you on your mobile and direct line, both diverted to voicemail. I

did not leave a message. I was seeking clarity to the terms of settlement.

I am willing to accept the offer of settlement on the proviso no costs are forwarded to me, refer to bullet point 3 (as highlighted below).

• is made on the basis that Australia Post will pay you four weeks' wages, being the amount you would have received if you received payment in lieu of notice;

• is made by Australia Post without admission of liability;

• is made without prejudice except as to costs, in accordance with the principles set out in Calderbank v Calderbank [1975] 3 All ER 333 and adopted in the Court of Appeal decision in Hazeldene's Chicken Farm Pty Ltd v WVA (No. 2) [2005] VSCA 298;

• is subject to the execution of a settlement and release agreement to be drafted by us; and

• remains open for written acceptance until by 5pm on Friday 8 November 2024.

Could you please return my call to progress with settlement?

• [10] At 4.43pm on 8 November 2024, Ms Miral responded to the Applicant in the following terms;

We confirm that the reference below does not mean costs will be forwarded to you. Australia Post will bear its own legal costs, and you will pay your own (if you have any). We will revert shortly with a settlement agreement.

• [11] At 4.47pm on 8 November 2024, the Applicant replied to Ms Miral by email in the following terms;

I have form F50 completed ready for lodgement with the commission, but will first await the settlement agreement to sign and return to you.

• [12] At 5.36pm on 8 November 2024, Ms Miral responded via email as follows to the Applicant;

"Thanks John, we are comfortable with that approach.

We will obtain instructions from Australia Post regarding the terms of the settlement agreement. Given the time that may occur over the weekend or on Monday morning.

In the meantime, we propose to write to the Commission now to advise that the parties have reached in-principle agreement and request that the hearing be adjourned to allow the settlement to be finalised. Please let us know if you have any concerns with this approach.

• [13] At 5.45pm on 8 November 2024, the Applicant then replied to Ms Miral by email as follows;

I agree with the suggested approach, in respect to the in principle agreement and allowing time to finalise the matter.

I will keep an eye out for further correspondence, and thanks again.

• [14] At 12.34pm on 11 November 2024, Ms Miral sent an email to the Applicant to which was attached a copy of the Deed. The email stated as follows;

Further to our emails on Friday afternoon, I attach a deed setting out the terms of Australia Post's offer.

You should read the attached deed carefully and get independent legal advice on its terms and effect, should you wish.

If you would like to accept Australia Post's offer, please sign and date the deed in front of a witness, and have your witness also sign and date the deed. Please then provide an executed copy of the deed to me as soon as possible.

If you do not return a copy of the properly dated, signed and witnessed deed, this offer will lapse.

This offer was made, and the enclosed deed is provided, on a "without prejudice save as to costs" basis, in the interests of the parties trying to resolve this matter. This means that this offer and the attached deed are confidential and cannot be relied on by you at a later stage in the current proceedings or any other legal proceedings. It does not mean that you will be responsible for Australia Post's legal costs.

• [15] At 1.15pm on 13 November 2024, the Applicant emailed Ms Miral in the following terms;

I am writing to formally withdraw my previous acceptance of the settlement offer dated 11/11/24. After careful consideration, I have decided not to proceed with the settlement.

• [16] At 6.50pm on 14 November 2024, Ms Miral wrote to the Applicant advising him that in the Respondent's view, a binding settlement had been reached on 8 November 2024, despite the Applicant declining to sign the Deed. Ms Miral further advised the Applicant that if he continued to refuse to act in accordance with the Settlement Agreement the Respondent would seek to have the matter dismissed pursuant to s 587 of the Act. Ms Miral then stated that in making an application for dismissal of the unfair dismissal application, the Respondent may suffer loss and incur costs that would otherwise not have been incurred. The Applicant's attention was then drawn to s 570(2)(b) of the Act regarding costs incurred by a party arising from another party's unreasonable acts or omissions. Ms Miral stated the Respondent may seek to recover costs because of the Applicant's failure to discontinue proceedings. The Respondent reserved its rights. The Applicant responded to Ms Miral at 7.06pm on 14 November as follows;

• [17] At 5.10pm on 18 November 2024, Ms Miral sent an email to my Chambers seeking that the matter be dismissed on the basis that a binding settlement had been reached.[12] The Applicant responded to that email in correspondence to my Chambers at 5.17pm on 18 November 2024 in the following terms;

The reason to cancel my acceptance was due to the respondent changing the terms of settlement.

I sought expertly advice and hence declined to execute the agreement.

I hope this helps in understanding why no F50 was lodged and the matter remains in dispute.

• [18] The Respondent submits that the parties engaged in without prejudice negotiations from 7 November 2024 by way of email correspondence between the Respondent's legal representative and the Applicant, culminating in a binding settlement being reached between the parties on 8 November 2024. The Respondent relies on the evidentiary material which is set out above in support of its submission that;

(a) an agreement was reached by the parties on 8 November 2024;

(b) the parties intended for this agreement to be legally binding;

(c) this agreement fits within the first or second category of Masters v Cameron;[14] and

(c) that agreement is binding, even though the Agreement was not signed.

• [19] The Respondent further submits that the four elements necessary to form a contract are present, namely; offer and acceptance, consideration, an intention to create legal relations and sufficient certainty of terms.

• The offer it says was made by the Applicant at 4.21pm on 8 November when he sought to re-introduce the offer that been previously communicated by the Respondent at 3.24pm on 7 November 2024. The offer was accepted by the Applicant at 4.47pm on 8 November 2024 and was detailed in an email from Ms Miral to the Applicant at 3.24pm on 7 November 2024. According to the Respondent, the terms were comprehensive and clearly articulated to the Applicant as not being open for negotiation.

• The Respondent contends that the Applicant had the opportunity to seek clarity regarding the terms and did do so by attempting to negotiate the financial offer and then seeking clarity regarding whether the offer meant he would be liable to pay for the Respondent's costs. There was, according to the Respondent, sufficient certainty of the terms.

• As to the consideration, the Applicant would discontinue the application and would be barred from bringing additional claims against the Respondent which would provide a payment equivalent to four weeks wages. The Respondent submits the Applicant's conduct demonstrated a joint understanding had been reached. This can be seen by the Applicant confirming he had completed the F50 notice of discontinuance on 8 November 2024 and his subsequent advice to Ms Miral on 13 November 2024 that he wished to 'withdraw his previous acceptance of the settlement'.

• [20] During oral submissions, the Respondent was questioned on the inclusion of additional items not dealt with in the 7 November 2024 settlement offer within the Deed. Mr Spargo conceded that there were some additional matters in the Deed. For example, the Deed provided for payment terms of 21 days after execution and included confidentiality and non-disparagement terms, neither of which were referred to in the 7 November 2024 offer that the Respondent characterised as the 'settlement agreement'. Mr Spargo contended that the parties were not prevented from negotiating additional items as part of finalising the terms of the Deed but that did not alter that a binding agreement had been reached on the terms set out in its offer to the applicant on 7 November 2024.

• [21] Mr Spargo contended that the statement in the 7 November 2024 email that the 'offer' would lapse if a signed copy of the Deed was not returned, was incorrect and should not have been made. He further argued the statement did not alter or disturb the binding settlement agreement reached on 8 November 2024 between the parties.

• [22] For all the reasons set out in its written submissions and in oral argument, the Respondent submits that a binding settlement was reached on 8 November 2024 constituting an 'accord and satisfaction' that extinguishes the cause of action of the existing unfair dismissal claim. On that basis, the Respondent submits that the Applicant's unfair dismissal application should be dismissed pursuant to s 587 of the Act.

• [23] The Applicant did not contest the factual background set out in the documents filed by the Respondent. He submits that while an agreement was reached to settle the matter, the Respondent subsequently included additional terms in the Deed. Having carried out 'due diligence' on the Deed's contents he declined to sign it which he understood, based on Ms Miral's 11 November 2024, would result in the settlement 'offer' lapsing. In these circumstances he contended that a binding settlement agreement had not been reached and that his unfair dismissal application should not be dismissed pursuant to s 587 of the Act.

• [24] Turning now to whether the application should be dismissed. In Masters v Cameron,[15] the High Court summarised three of the circumstances in which a binding settlement is reached:

"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.

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."

• [25] In the present case it is clear from the evidence set out above that the parties engaged in email communication on the 7 & 8 November 2024. This occurred firstly by the Respondent providing an offer to settle the matter. The offer was initially rejected by the Applicant, and he proposed a counteroffer at 8.23pm on 7 November 2024, relevantly including a claim for 13 weeks payment rather than the 4 weeks offered by the Respondent. The Applicant's counteroffer was then rejected by the Respondent in an email sent by Ms Miral at 2.56pm on 8 November 2024 in which the Respondent's offer of 7 November 2024 was restated and that it was not open for negotiation. The Applicant then responded at 4.20pm and stated that he was willing to 'accept the offer' subject to not incurring any of the Respondent's legal costs, which Ms Miral promptly confirmed was the case at 4.43pm on 8 November 2024.

• [26] It is clear enough in my view that an agreement had been reached to settle the matter at the point of confirmation by Ms Miral that the Applicant would not be exposed to any of the Respondent's legal costs. Subsequent conduct of the parties reinforces that an agreement was reached. This can be seen firstly by the Applicant emailing Ms Miral at 4.47pm on 8 November 2024 and advising that he had completed his Form F50 and that it was ready for lodgement, subject to receiving the 'settlement agreement to sign and return'. Further evidence of the joint understanding that a settlement was reached is seen by Ms Miral's email to the Applicant at 5.36pm on 8 November 2024 advising that the Respondent proposed to write to the Commission to advise that the parties had 'reached in-principle agreement' and to request the hearing listed for 11 November 2024 be adjourned to 'allow the settlement to be finalised'. The Applicant agreed with that approach in his response to Ms Miral at 5.45pm on 8 November 2024.

• [27] Any doubt as to whether a legally binding agreement had been reached on 8 November 2024 was removed by the Applicant's subsequent withdrawal of his agreement on 13 November 2024. He specifical stated that he was 'writing to formally withdraw my previous acceptance of the settlement offer dated 11/11/24'. The language used by the Applicant leaves no doubt that he understood that an agreement had been reached and that he was seeking to withdraw from that agreement. The terms of the agreement reached by the parties were in my opinion clearly articulated and provided for the following;

• payment of four weeks' wages to the Applicant, being the amount the Applicant would have received if he had received payment in lieu of notice;

• each party to bear their own legal costs incurred in the matter; and

• the agreement was subject to the execution of a settlement and release agreement to be drafted by the Respondent.

• [28] The Applicant contends that the Deed prepared by the Respondent included additional matters that were not included in the original 'offer' that he had accepted. The email from Ms Miral to the Applicant on 11 November 2024, to which the Deed was attached, relevantly stated that if the Applicant failed to return a copy of the Deed properly dated, signed and witnessed, the offer would lapse. Having regard to the language of Ms Miral's 11 November 2024 email and the additional matters contained in the Deed not dealt with in the 7 November 2024 offer, the Applicant submits that agreement to settle the matter was not reached.

• [29] I accept the Deed prepared by the Respondent and forwarded to the Applicant on 11 November 2024 included matters not referenced in the 7 November 2024 settlement offer. The additional clauses dealt with confidentiality, non-disparagement and miscellaneous provisions, none of which were included in the offer. While the substance of those clauses may arguably be described as uncontroversial, they were nonetheless new matters, which had the effect of seeking to change the settlement agreement that had been reached. The Applicant in these circumstances was entitled to resist signing the Deed unless changes were made to ensure the Deed reflected the settlement agreement reached on 8 November 2024 or alternatively, he could have negotiated in relation to the final content of the Deed. Neither of these paths were taken by the Applicant as he simply sought to withdraw from the agreement that had been reached.

• [30] While I have considered that the Deed prepared by the Respondent contained new matters not included in the settlement agreed on 8 November 2024, that does not alter the status of the agreement reached. An agreement was in my view reached by the parties on 8 November 2024. That is because it is clear that the parties intended for that agreement to be legally binding and that it was binding, even though an agreement reflected in a Deed was not signed. As the agreement was subject to the execution of a Deed, I am satisfied that the settlement reached was of the first type referred to in Masters and Cameron. In Australian Postal Corporation v Gorman[16], Besanko J held that the existence of a binding settlement or 'accord and satisfaction' extinguishes the existing cause of action and replaces it with a new cause of action based on the agreement.

• [31] As I have found above, the parties reached agreement on 8 November 2024, and I am satisfied the agreement was of the first type referred to in Masters v Cameron. In these circumstances I am satisfied that the Applicant's unfair dismissal application has no reasonable prospects of success. Consequently, I have determined to exercise my discretion pursuant to s 587(1)(c) of the Act to dismiss the application for an unfair dismissal remedy. In doing so I have acted on the application of the Respondent pursuant to s 587(3)(b) of the Act.

• [32] The application for an unfair dismissal remedy is dismissed. An order giving effect to this will be issued with this decision.

[1] Exhibit R1, Email from Jessica Miral to John Sullivan, dated 7 November 2024 at 3.28pm

[2] Exhibit R2, Email from John Sullivan to Jessica Miral, dated 7 November 2024 at 8.23pm

[3] Exhibit R3, Email from Jessica Miral to John Sullivan, dated 8 November 2024 at 2.56pm

[4] Exhibit R4, Email from John Sullivan to Jessica Miral, dated 8 November 2024 at 4.20pm

[5] Exhibit R5, Email from Jessica Miral to John Sullivan, dated 8 November 2024 at 4.43pm

[6] Exhibit R6, Email from John Sullivan to Jessica Miral, dated 8 November 2024 at 4.47pm

[7] Exhibit R7, Email from Jessica Miral to John Sullivan, dated 8 November 2024 at 5.36pm

[8] Exhibit R8, Email from John Sullivan to Jessica Miral, dated 8 November 2024 at 5.45pm

[9] Exhibit R10, Email from Jessica Miral to John Sullivan, dated 11 November 2024 at 12.34pm

[10] Exhibit R11, Email from John Sullivan to Jessica Miral, dated 13 November 2024 at 1.15pm

[11] Exhibit A1. Email exchange between Jessica Miral and John Sullivan, dated 14 November 2024

[12] Exhibit R12, Email from Jessica Miral to Chambers of Deputy President Masson, dated 18 November 2024 at 5.10pm

[13] Ibid, Email from John Sullivan to Chambers of Deputy President Masson, dated 18 November 2024 at 5.17pm

[14] Masters v Cameron [1954] HCA 72; (1954) 91 CLR 353.

[15] Masters v Cameron [1954] HCA 72; (1954) 91 CLR 353, 360.

[16] [2011] FCA 975.

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