A statement to similar effect was made in the plaintiff's letter of 21 February 2008. In that correspondence, the plaintiff said:
" As you know, the Redundancy calculation estimate attached to the reminder letter was wrong and Tooheys rescinded those estimates on 6 February 2008. Following discussions with individuals and your union, Tooheys understands that you may have nominated for redundancy believing that you would be paid this incorrect figure at the time of your redundancy. In these circumstances Tooheys does not consider that you are bound by the preference you expressed at that time. "
50 As counsel for the defendants submitted, it was implicit in this statement that absent the plaintiff's errors, it would have considered the defendants so bound.
51 I do not consider the word "outlined" in the sentence "I wish to accept a redundancy package as outlined in the attached calculation" to indicate an absence of contractual intent. Whilst in some contexts to outline a subject may mean to sketch its main features, in the present context, having regard to the content of the calculations and supporting notes, the word does not have that meaning. The calculations were set out in detail and were said to be accurate at the time of processing. In the present context "outlined" means "set out".
52 The primary basis for saying that there was no consensus on any particular terms as to payment of the redundancy package is the statement on each of the redundancy calculations that "This redundancy calculation is an estimate only - advise [sic] of Final Dates and Calculations will be at Lion Nathan's discretion".
53 This statement has to be read in the context of the other notes on the document that the calculation was accurate at the time of processing, but contract changes or the taking of leave prior to redundancy would affect the final amount payable. I cannot reconcile the statement that the calculation was accurate at the time of processing with the calculation being merely an expression of opinion as to the likely approximate calculation of the amount to be paid on redundancy (see J J Savage & Sons Pty Ltd v Blakney (1970) 119 CLR 435 at 442), except on the basis expressed in the notes that the final amount payable would be affected if leave were taken or the employee's contract changed prior to the redundancy date or there was an excess payment of salary. Construing the document as a whole, I take the document to mean that the redundancy calculation could be varied if the plaintiff decided to change the final date of the defendants' employment, or if leave were taken, or if there were changes to the defendants' contract prior to the redundancy date, or to set off any payment of excess salary.
54 The plaintiff submitted that the letters could not give rise to binding contracts because any agreement was incomplete. This was because the plaintiff had reserved a discretion to amend the redundancy calculations and there can be no contract if the promissor reserves a discretion or option as to whether he will carry out what purports to be the promise (Godecke v Kirwan (1973) 129 CLR 629 at 646-7).
55 This submission assumes that the words in bold at the foot of the page were unqualified by the notes. For the reasons in para [53] I do not consider that, read as a whole, the document purports to reserve such a discretion as that for which the plaintiff contends. Moreover, on no view could the final calculations be at the plaintiff's discretion. If the letters were offers capable of giving rise to contracts to pay the calculated amounts, the plaintiff would not have a discretion to reduce the amounts after acceptance. If the statement was unqualified, that might suggest that the letters were not such offers. But on the plaintiff's case, the defendants were to be paid according to the award (or any individual contract if that gave a greater entitlement). Again, the plaintiff would have no discretion to pay less than the award, or less than the amount payable under any individual contract of employment. In either case the plaintiff would have a discretion to offer more but not less. Those words are neutral.
56 By inviting the defendants to indicate their wish to "accept a redundancy package as outlined in the attached calculation" the plaintiff was implicitly making an offer of a "redundancy package as outlined in the attached calculation". At no stage did the plaintiff say in terms to the defendants that if they accepted a redundancy package they would be paid their entitlement under the award. The evidence does not suggest that the plaintiff offered to pay the defendants more by annual leave or long service leave than they were entitled to under the award or under any individual contracts of employment. The offer of a "redundancy package" rather suggests that the plaintiff was offering something more than that to which the defendants would in any event be entitled if they chose not to take up the alternative employment. If that was all that was on offer one would expect the plaintiff to say so. Whilst the attachment stated the basis on which the redundancy payment was calculated, and that was in accordance with the award, the letter did not say that the payment would be in accordance with the award. The heading "Redundancy Calculation as per Tooheys Redundancy Policy" did not refer to the award. The change to the heading from the previous calculations is a neutral consideration.
57 The words "redundancy package as outlined in the attached calculation" directed attention to the figures on the attached sheet rather than the formulae stated to be the basis on which the figures had been calculated. Had the defendants compared the figures with the stated basis for their calculation they should have appreciated that the figures were erroneous, but, as noted above, the claim to avoid the contract on the ground of unilateral mistake was not pursued.
58 On the question whether the "attached calculation" referred to the figures or the notes, I think it is clear that the reference was to the figures. A review of the correspondence shows there was never a correlation between the figures provided for redundancy pay and the stated basis of calculation of those figures. It would be reasonable to expect the employees to look at the "bottom line" of what they would be paid in deciding whether to take redundancy or accept alternative employment.
59 The disconformity between what was stated in the notes as the basis of calculation of the redundancy component and the figures would not render any contract void for uncertainty and hence preclude the acceptances from giving rise to a binding contract. To the contrary, the letter will be construed so as to seek to ascertain the parties' intention and give effect to that intention. The fact that different parts of the documents indicate different outcomes so that there is more than one possible meaning does not result in a contract being void for uncertainty (The Council of the Upper Hunter County District v Australian Chilling & Freezing Co. Ltd (1968) 118 CLR 429 at 436-437).
60 Mr Sawyer believed that there would necessarily be discrepancies between the calculation attached to the 31 January 2008 letters and the plaintiff would have to reissue a further estimate in the near future. The plaintiff did not say so when it sent out the letters. To the contrary, the attached schedule stated that the calculation was accurate at the time of processing. Mr Sawyer's subjective belief is not relevant.
61 To recapitulate, and at the risk of repetition, the issue is whether the letters of 31 January 2008 were offers to pay dollar sums in the attached schedules in consideration of the defendants not taking up the offer of employment, or whether the letters were estimates of the sums which would be paid pursuant to the award or any individual contract of employment if the defendants elected to take redundancy rather than the offer of alternative employment.
62 The strongest factor in favour of the second construction is the statement at the foot of the attached schedules that the redundancy calculation was an estimate only and that advice of final dates and calculations would be at Lion Nathan's discretion. However, for the reasons above, when construed in the light of the other statements of the document, in particular the statement that the calculation was accurate at the time of processing, the reference to the calculation being an estimate only is to be understood as stating that the calculation could be varied if circumstances relating to the defendants' employment changed. The statement that advice of the final date of employment would be at Lion Nathan's discretion is neutral although it is one of the matters which would affect the calculation. If the statement that final calculations would be at Lion Nathan's discretion was not qualified by the notes, the statement would be wrong unless it meant that the plaintiff could increase its offer, in which case the statement was neutral as it would apply equally to either construction of the document.
63 A second consideration in favour of the latter construction is that the letter contains no express offer to pay any amount. However, it is implicit in the plaintiff's seeking the defendants' acceptance of a redundancy package that the plaintiff was offering to pay the amount of the package if the defendants' elected to accept it.
64 A third consideration is that the plaintiff was under no obligation to pay more than the award or the amount payable under any individual contract on employment. That is no reason why the plaintiff could not agree to pay more than it was obliged to do in order to encourage the employees to take redundancy. As noted above, there is no issue as to the sufficiency of the consideration to support an offer to pay the amounts in the attached calculation.
65 A fourth consideration is that the amount offered to be paid as a redundancy component was stated to be three weeks' salary for the first 15 years and four weeks per year thereafter. But that was not the basis on which the figures were calculated. The employees could be expected to rely on the figures presented as an accurate calculation rather than making their own calculations to determine the amount they would receive. This is especially so given that previous calculations, which were also stated to be accurate, bore no relationship to the basis on which it was said they had been prepared.
66 There are other factors tending to show that the letter was an offer capable of acceptance and not merely an estimate of the defendants' entitlement under the award or any individual contract of employment. They are, first, that there was no express statement to the effect that if the employees took redundancy they would only be paid their entitlement under the award or other contract of individual employment. Secondly, notwithstanding the plaintiff's submission to the contrary, it was intended that the defendants would be bound by their election. Thirdly, the invitation to the employees to tick a box indicating their wish "to accept a redundancy package as outlined in the attached calculation" impliedly conveyed an offer to pay a redundancy package as outlined in the attached calculation. Coupled with the fact that the employees' decision to accept the redundancy package would be final, the language used is more indicative of an intention to contract than an intention to provide merely an estimate of sums which would be payable pursuant to the award (or any individual contract of employment) if the defendants elected not to take up the offered employment.
67 It follows that in the case of those defendants who returned their signed acceptances prior to receiving notice of withdrawal of the offer contained in the letter of 31 January 2008, that the plaintiff is bound to pay the amounts set out in the calculations attached to the letters of that date. The plaintiff also acknowledges that the first defendant should be treated as if he were in that position.
68 Different considerations apply to the second defendant (Mr Emerson) or the seventh defendant (Mr Tynan).
Position of Second Defendant
69 Since 2005, there had been an unresolved issue between Mr Emerson and the plaintiff as to his level of salary. The plaintiff claimed that he was being overpaid by about $7,000 per annum. Mr Emerson disputed that this amount was an overpayment and said it reflected an agreement reached between himself and a previous manager. Mr Sawyer said it was called a "transition allowance" because the plaintiff intended that Mr Emerson would be "transitioned" to the remuneration structure under the award without the additional remuneration. The plaintiff continued to pay Mr Emerson the additional amount but the issue was unresolved.
70 Mr Emerson had been offered the one position for the day shift in the Process Services Department which would remain after the implementation of Project Key.
71 The covering letter dated 31 January 2008 to Mr Emerson was in different terms from the letters to the other defendants. It read:
" This letter acts as a reminder about the upcoming date we require your decision about remaining in the day role, Process Services.
Should you choose to pursue Redundancy, 31st May 2008 will be your final day with Tooheys.
You have already received your updated redundancy calculation however I have attached another copy to this letter. This calculation is based on your end date being May 31st 2008.
Please contact Gary Faulkner or Jane Humphreys should you have any queries.
We look forward to you [sic] response before 8 am, Monday February 4th 2008 . Please nominate your preference below and return to Gary Faulkner. Should you not indicate your preference to remain in the day role, we will assume you wish to accept a redundancy package. "
72 Just before 8.00 am on 4 February 2008, Mr Emerson telephoned Mr Faulkner and told him that before he could make an informed decision he needed to know whether his transition payment was going to be part of his remuneration if he took up the offer of employment in the day shift. A meeting was arranged for later that day with Mr Faulkner and a Mr Fred Sadie. Mr Emerson asked whether the company was going to retain his transition payment. Later that day Mr Faulkner told him the answer was "no". Mr Emerson said that he disputed that outcome and wanted to seek further advice from the LHMU. He said he could not make a decision as the transition payment made up about $7,000 of his salary. Mr Faulkner told him he needed to make a decision but Mr Emerson said "No I can't I need to speak with the union." Mr Faulkner then said that that was fine. By these conversations the parties extended the deadline for response. Properly, it was not submitted for Mr Emerson that he was to be taken to have accepted the redundancy package because he had not nominated his preference before 8.00 am on 4 February 2008.
73 A meeting was arranged the following day at 2.30 pm. The persons present were Mr Sawyer, Mr Faulkner and Ms Jane Humphreys, for the plaintiff and Mr Emerson and Ms Moriarty, for the second defendant. Ms Moriarty is the assistant secretary of the Liquor Hospitality and Miscellaneous Union - NSW Branch. There was some dispute as to what was said at the meeting although I do not consider there to have been a substantial dispute as to essential matters. Mr Emerson deposed that the issue of the transitional payment was discussed as follows:
" 16. ... Luke opened the conversation on the issue of the transitional payment with words to the effect:
'We have decided to honour the transitional payment due to the fact we have paid it for about the last eight years.'
I responded with words to the effect:
'That is great'
He then replied promptly after with words to the effect:
'But we haven't considered this payment in your redundancy calculations and its [sic] about $7,000.00 per year and you have been here 20 years, so it equated to around $140,000.00'.
I responded with words to the effect:
'Really? Is this on top of the latest offer?'
Luke Sawyer said:
'Yes'.
Tara Moriarty responded to Luke with words to the effect:
'Can we have that in writing."
Luke Sawyer responded with words to the effect:
'It's in writing."
He extended his hand to mine and we shook hands on the deal.
17. The meeting ended shortly after. "
74 Ms Moriarty gave evidence to similar effect. She deposed that Mr Sawyer said words to the effect of:
" On 5 February 2008 I attended at meeting [sic] in Luke Sawyer's office at Tooheys to discuss a member, Paul Emerson's, transitional payment issue. This issue had remained unresolved for a long period of time.
Paul Emerson and I attended the meeting with Jane Humphreys, Gary Faulkner and Luke Sawyer. Initially Paul Emerson's transitional payment was discussed in the circumstances should he remain employed with Tooheys.
Luke Sawyer stated using [sic] words to the effect of:
'We have issued the wrong figure. We have realised that we have left out a payment. It's $7,000 per year for 20 years.'
'That's $140,000.00'
'So that's on top of the previous document issued.'
...
I then asked Luke Sawyer using words to the effect of:
'Can we please have that in writing?'
Mr Sawyer responded with words to the effect of:
'This is in writing'
As Luke Sawyer said these words he stood up and extended his hand across his desk to Paul Emerson and shook hands. Paul Emerson and I then left Luke Sawyer's office. "
75 Mr Sawyer substantially agreed with these versions of events. The area of disagreement was that Mr Sawyer did not recall whether Mr Emerson asked the question "Really? Is this on top of the latest offer?" or if he responded as Mr Emerson deposed. He also believed that he shook Mr Emerson's hand before he stated the figure of $140,000. In his affidavit he said he was not certain of this. In cross-examination he said that he was 99 percent sure. However, I do not accept that evidence. Neither Ms Humphreys nor Mr Faulkner was called. I accept Mr Emerson's version of what was said at the meeting and as to the time and circumstances in which Mr Sawyer stood up and shook his hand.
76 Nonetheless, I think it is clear from Mr Emerson's own version of events that in extending his hand, Mr Sawyer was confirming that his offer of an additional $140,000 to Mr Emerson's redundancy payment was as good as if the offer were in writing. Mr Emerson did not say that he accepted the offer. I do not accept that it can be inferred from the handshake initiated by Mr Sawyer and unaccompanied by words of acceptance from Mr Emerson, that Mr Emerson there and then indicated his acceptance of the offer.
77 I also consider that Mr Emerson appreciated at the time that Mr Sawyer was making a mistake in offering an additional $140,000 as a redundancy payment on the basis of an additional $7,000 annual remuneration on the basis of Mr Emerson's having worked with the plaintiff for 20 years. Mr Emerson denied knowing that it was a mistake, although he said it was surprising. In any event, I do not think that Mr Emerson intended that Mr Sawyer's surprising offer of an additional $140,000 was accepted by his accepting Mr Sawyer's handshake. There were no words of acceptance to snatch such a surprising offer.
78 When Mr Emerson left the meeting, no concluded agreement had been reached whereby Mr Emerson had accepted the offer contained in the letter of 31 January together with the additional $140,000 proposed by Mr Sawyer. The following day the offer was withdrawn before being accepted.
Position of the Seventh Defendant
79 Mr Tynan received the letter of 31 January 2008 on that day. That evening he completed the section for acceptance of the redundancy package and signed it. 31 January was a Thursday. Mr Tynan did not return the signed letter on Friday 1 February or Monday 4 February 2008. On 4 February 2008, he spoke with Ms Humphreys. He said to her words to the effect:
" I'm accepting the offer. I want to make a time to come in and give you the paper work and to discuss with you the fact that the calculation as to my annual leave and long service leave are still not right. "
80 Ms Humphreys said that she or other staff who needed to be present (Mr Sawyer and Mr Faulkner) were not available until Thursday 7 February. Mr Tynan made an appointment to see Ms Humphreys on 7 February. Mr Tynan did not hand over the signed letter of 31 January at his meeting with Ms Humphreys.
81 Mr Shoebridge submitted that the letter of 31 January 2008 could be accepted orally. I agree that the signing and returning of the letter of 31 January 2008 was not the only way in which the offer contained in the letter of 31 January 2008 could be accepted. I agree that the offer in the letter could be accepted orally. The letter did not stipulate an exclusive mode of acceptance and an oral acceptance would not disadvantage the offeror (Tinn v Hoffmann & Co (1873) 29 LT 271 per Honyman J at 274 and Brett J at 278; Manchester Diocesan Council for Education v Commercial & General Investments Ltd [1970] 1 WLR 241 at 246; Spectra Pty Ltd v Pindari Pty Ltd [1974] 2 NSWLR 617 at 623-624; White Trucks Pty Ltd v Riley (1948) 66 WN (NSW) 101 at 103). However, I do not accept that by those words Mr Tynan accepted the offer contained in the letter of 31 January 2008. His acceptance was not unqualified. Even though the qualification was as to the calculation of annual leave and long service leave it was not open to him to accept the offer in the letter of 31 January 2008 as to some parts and not as to others.
82 The following day Mr Tynan received a telephone call from Mr Faulkner. Mr Faulkner told him that there had been a mistake and that Tooheys was going to rescind the offer. Mr Tynan said to Mr Faulkner:
" You must be joking. I have already accepted it and have signed the document. We have an agreement. I thought you were paying me that amount to leave the company. "
83 Mr Faulkner's statement that the plaintiff was going to rescind the offer was an effective withdrawal of the offer. Mr Tynan's statement that he had already accepted the offer was not correct. It would only have been correct if his oral acceptance of the offer the previous day was unqualified.
84 The following day, 6 February 2008, Mr Tynan attended a meeting with Ms Humphreys, Mr Sawyer and Mr Faulkner. Another person was also present. At the commencement of the meeting Mr Sawyer apologised for the errors in the letter of 31 January 2008. He said that the plaintiff was in the process of generating updated estimates which he hoped would be provided shortly. Mr Tynan said he had signed up for the amount set out in the letter and was upset that Mr Sawyer continued to "mess me around". Mr Sawyer said:
" The redundancy estimates issued had a massive error in the calculations and that amount will not be what you are receiving if you sign this form. If you are signing up to take a redundancy package, then you are signing up to take the correct amount which, as I said, we are hoping to issue you shortly. "
85 Mr Tynan said:
" You guys owe me what is in that estimate because that is what I am signing up for. But there are still problems with my annual leave and long service leave and they should be amended too. "