Industrial Relations Commission New South Wales Medium Neutral Citation: Fraser v Commissioner of Fire and Rescue NSW [2022] NSWIRComm 1026 Hearing dates: 18 June 2021 Date of orders: 14 April 2022 Decision date: 14 April 2022 Jurisdiction: Industrial Relations Commission Before: Chief Commissioner Constant, Commissioner Sloan, Commissioner Webster Decision: Leave to appeal is refused Catchwords: APPEAL – public sector disciplinary appeal – demotion from Deputy Manager, ComSafe Training Services, Operational Support Level 3 to Senior Firefighter – settlement reached – Deed of Release – demotion altered to Assistant Equipment Management Officer role, Operational Support Level 2 – appellant initially placed in Technical Officer role, Operational Support Level 2 – whether the Deed constitutes a bar to the appellant pursuing his disciplinary appeal - whether respondent had repudiated the Deed – appellant did not accept the repudiation through his conduct Legislation Cited: Fire and Rescue NSW Act (NSW), ss 66, 70 Industrial Relations Act 1996 (NSW) ss 3, 98, 163, 100E, 100F, 187, 188 Cases Cited: Caleta Trpimir v Northern Sydney Area Health Service [1995] NSWIRComm 38 Dockside Holdings v Rakio [2001] SASC 78 Dr Payne v The University of Sydney & Anor [2000] NSWIRComm 102 Electricity Generation Corporation v Woodside Energy Ltd (2014) 251 CLR 640 Foran v Wight (1989) 168 CLR 385 Grant v John Grant & Sons Pty Ltd (1954) 91 CLR 112 Gunton v Richmond-upon-Thames London Borough Council [1981] 1 Ch 448 J Kitchen & Sons Pty Ltd v Stewart's Case and Carry Stores (1942) 66 CLR 116 Koompahtoo Local Aboriginal Land Council v Sapine (2007) 233 CLR 115 Liszt v Health Secretary in respect of Sydney Local Health District [2020] NSWIRComm 1030 Mainteck Services Pty Ltd v Stein Heurtey SA (2014) 89 NSWLR 633 Public Service Association and Professional Officers' Association Amalgamated Union of New South Wales v Roads and Maritime Services [2015] NSWIRComm 16 Qantas v Gubbins (1992) 28 NSWLR 26 Rinehart v Hancock Prospecting Pty Ltd (2019) 93 ALJR 582; [2019] HCA 13 Westpac Banking Corporation v Tanzone Pty Limited & Ors [2000] NSWCA 25 Whittaker v Unisys Australia Pty Ltd (2010) 192 IR 311 Wollongong Coal Ltd v Gujarat NRE India Pty Ltd (2019) 100 NSWLR 432 Category: Principal judgment Parties: Andrew Fraser (appellant) Commissioner of Fire and Rescue NSW (respondent) Representation: Counsel: L Saunders (appellant) P M Bindon (respondent) Solicitors: A Polites, Fire Brigade Employees' Union (appellant) C Lenard, Kingston Reid (respondent) File Number(s): 2020/327289 Publication restriction: Nil Decision under appeal Court or tribunal: Industrial Relations Commission of NSW Citation: [2020] NSWIRComm 1072 Date of Decision: 22 October 2020 Before: Commissioner Murphy File Number(s): 2019/254133 decision 1. This is an appeal pursuant to s 187 of the Industrial Relations Act 1996 (NSW) (the Act) from the decision of Commissioner Murphy on 22 October 2020 (Primary Decision) pursuant to s 100F of the Act to dismiss the appellant's public sector disciplinary appeal (Proceedings). The correct name of the respondent, for the purposes of this appeal and the Proceedings, is the Commissioner of Fire and Rescue NSW: Fire and Rescue NSW Act 1989 (NSW) ss 66 and 70. 2. The appellant commenced the Proceedings on 15 August 2019 pursuant to s 98 of the Act to dispute the respondent's decision to demote him from the position of Deputy Manager in ComSafe Training Services to Senior Firefighter following an investigation into his conduct. The Proceedings were listed for hearing on 19 to 21 February 2020, but the day before the hearing commenced the parties requested that Commissioner Murphy conduct a conciliation conference instead, with a view to the parties settling the Proceedings. 3. The conciliation conference was conducted on 19 February 2020 during which the parties reached an in-principle agreement which was to be recorded in a deed. Commissioner Murphy adjourned the Proceedings to 14 April 2020. 4. The parties and the appellant's representative (the Fire Brigade Employees' Union (FBEU)) subsequently executed a deed dated 24 February 2020 (Deed). 5. A report back before Commissioner Murphy occurred on 14 April 2020, and again on 28 April 2020 and 18 May 2020. On the latter occasion the appellant indicated that he wished to continue the Proceedings and have his public sector disciplinary appeal heard. 6. The respondent brought a jurisdictional objection on the basis that the Deed was a bar to the appellant continuing the Proceedings and brought a notice of motion for the Proceedings to be dismissed pursuant to s 100F(a) of the Act. 7. The jurisdictional objection was heard by Commissioner Murphy on 4 August 2020. In the Primary Decision, Commissioner Murphy upheld the respondent's jurisdictional objection and dismissed the Proceedings. The Primary Decision 1. The Primary Decision set out the relevant parts of the Deed (at [6]). It is appropriate to reproduce those here, given their central relevance to this appeal: "Background A. SF Fraser was employed by FRNSW as Deputy Manager ComSafe Training Services Operations Support Inspector. B. On 6 August 2019 FRNSW Deputy Commissioner Jeremy Fewtrell wrote to SF Fraser advising him that he had decided to impose a disciplinary penalty of demotion and removal from his role as Deputy Manager ComSafe Training Services to a Senior Firefighter position in respect of the sustained allegations of bullying and harassment (Allegation One), and to issue a disciplinary reprimand in respect of the sustained allegation that he had disobeyed a lawful direction (Allegation Two), and provided reasons for his decision (Misconduct Outcome), C. At the time of the Misconduct Outcome, SF Fraser was remunerated as an Operational Support Inspector as per the Crown Employees (Fire & Rescue NSW Permanent Firefighting Staff) Award 2017 (Permanent Award). D. SF Fraser has sought relief from the Misconduct Outcome as a Public Sector Disciplinary Appeal brought pursuant to Part 7 of the Industrial Relations Act 1996 (IR Act) for reduction in penalty only. SF Fraser is represented by the FBEU as the applicant in matter no. 2019/254133 before the Industrial Relations Commission (IRC) of NSW (Proceedings). E. The Parties have agreed to accept the terms and conditions set out in this Deed in full and final discharge of their respective obligations and in settlement of all facts or matters referred to or alleged in the Proceedings in accordance with the terms of this Deed. Agreed terms 1. Undertaking and warranty 1.1 SF Fraser undertakes and warrants that he: (a) Accepts his removal from the Operational Support Inspector position of Deputy Manager ComSafe; (b) Will not apply for any role in Comsafe unless invited to do so by FRNSW management; (c) Will not commence or attempt to commence any proceedings in any jurisdiction against FRNSW arising from any aspect of the Misconduct Outcome or the Proceedings against FRNSW; save as to his protected rights under the Workers' Compensation Act 1987. 1.2 FRNSW undertakes and warrants that: (a) Deputy Commissioner Fewtrell's decision will be redacted and replaced with a decision effective 6 August 2019 that Mr Fraser: i. in respect of Allegation One, be reduced in rank to Operational Support Level 2, with the consequent reduction to a weekly wage of $2,030.76; ii. in respect of Allegation Two, be reprimanded: and iii. be ineligible for promotion or higher duties appointments for a period of 12 months (i.e. until 6 August 2020). (b) SF Fraser will be back-paid the difference between Operational Support 2 and Senior Firefighter weekly wage to 6 August 2019 at the rate of $340.59 per week; (c) FRNSW will create an ongoing placement for SF Fraser in an Operational Support Level 2 position in Operational Logistics working special projects assisting Equipment Logistics and Equipment Management (Position), based at Greenacre. A copy of the Position Description is attached at Schedule A; (d) SF Fraser will remain as a Senior Firefighter and will commence in the Position in accordance with written notice by FRNSW which is to be issued no less than 3 weeks from 19 February 2020; (e) SF Fraser's position at Beecroft will be preserved until 14 April 2020; (f) At the expiry of the period in 1.2(a)iii. above, SF Fraser will be able to access any opportunities by merit selection and such processes will be conducted in accordance with FRNSW policies and procedures. 1.3 Subject to clause 1.8, SF Fraser and FBEU undertake and warrant that they will not publish or broadcast any information regarding the Proceedings. 1.4 The FBEU undertakes and warrants that SF Fraser's acceptance of the role in 1.2(c) above negates the need for further consultation by the FBEU in respect of this role. (collectively, the Undertakings). 1.5 SF Fraser acknowledges and agrees that each of the Undertakings in clauses 1.1 and 1.3 are separate and enforceable undertakings and warranties. 1.6 FRNSW acknowledges and agrees that each of the Undertakings in clause 1.2 are separate and enforceable undertakings and warranties. 1.7 FBEU acknowledges and agrees that each of the Undertakings in clauses 1.3 and 1.4 are separate and enforceable undertakings and warranties. 1.8 Nothing in this Deed prevents SF Fraser or FRNSW from stating, if necessary, that the Proceedings have concluded. 2. Release and discharge SF Fraser and the FBEU unconditionally releases and discharges FRNSW and its officers, employees, servants, agents, assigns and insurers from any and all Claims, no matter how the same arose, and on every count, which now exist including in relation to the Misconduct Outcome and the Proceedings, which, but for this Deed, exist at the date of this Deed. 3. Report Back and Discontinuance of the Proceeding 3.1 The Proceedings will be listed for report back on 14 April at 9.30am before Commissioner Murphy at the IRC. 3.2 SF Fraser is to notify the IRC and FRNSW in writing by 7 April 2020 as to whether the report back is required to go ahead. 3.3 Should SF Fraser indicate a report back is not needed, or should SF Fraser not provide any written notice in accordance with clause 3.2, the Proceedings will be taken as discontinued on 8 April 2020. 3.4 Unless SF Fraser requests the report back go ahead, SF Fraser agrees to instruct the FBEU to file a Notice of Discontinuance of the Proceedings with the IRC and take all steps necessary and do all things required to discontinue the application within 3 business days of 8 April 2020. 3.5 The dates identified as clauses 3.2 to 3.4 inclusive can be amended by written agreement between FRNSW and the FBEU. ... 7. Warranties 7.1 SF Fraser and the FBEU warrant that: (a) this Deed is voluntarily entered into; (b) SF Fraser has been given the opportunity to take legal and financial advice as to the nature, effect and extent of this Deed; (c) SF Fraser understands the legal significance and effect of executing this Deed; and (d) SF Fraser is aware that FRNSW is relying upon these warranties and remains prepared to exercise its rights in the event any such warranties are breached. 7.2 FRNSW warrants that it has not made any promise, representation or inducement or been party to any conduct material to the entry into of this Deed other than as set out in this Deed. 8. Further action Each of the Parties to this Deed must sign and execute documents and do all such further acts, matters and things that are necessary and desirable to give effect to the provisions of this Deed. 9. General … 9.3 Both Parties may plead this Deed in any jurisdiction as a complete defence to any actions, suits or proceedings commenced, continued or taken by or on behalf of the other party in connection with any of the matters referred to in this Deed, including but not limited to any of the matters referred to in the Background of this Deed. 9.4 Every clause and sub-clause of this Deed will, where the context permits, be severable from every other without invalidating or affecting the remaining provisions of this Deed or the validity of that provision in any other jurisdiction. 9.5 A waiver by one Party does not prejudice its right in respect of any subsequent breach of this Deed by the other party. A Party does not waive its rights under this Deed because it grants an extension or other forbearance to the other Party. 9.6 This Deed constitutes the entire agreement of the Parties relating to this Deed and supersedes all prior understandings, negotiations, agreements, written or oral, express or implied, in relation thereto." 1. In support of the notice of motion, the respondent argued that the effect of the Deed was to act as a bar to the appellant continuing the Proceedings. In summary, this was because: 1. The appellant had executed the Deed and delivered it to the respondent and was bound by its terms. 2. Those terms included paragraphs 8 to 14 of the Deed in which the appellant released the respondent from all 'Claims' (as defined in the Deed) which included the Proceedings, and this release was given unconditionally. The appellant had also received the benefit of the respondent's compliance with the terms of the Deed. 3. As a result of the respondent's compliance with the terms of the Deed, the disciplinary decision the subject of the Proceedings was no longer effective in any event. 1. The appellant argued that the Deed did not operate as a bar to him continuing the Proceedings. In summary, this was because: 1. The Deed did not reflect a concluded agreement, as the proposed report back before Commissioner Murphy on 14 April 2020 referred to in clause 3.1 of the Deed meant that the placement of the appellant into the role of Assistant Equipment Management Officer was only for a "trial period'', with the appellant having the right to come back to the Commission and pursue his appeal if he found the role unsuitable. 2. Alternatively, the respondent had repudiated the Deed by initially placing the appellant in the role of Technical Officer (rather than the new role of Assistant Equipment Management Officer specified in the Deed) and the appellant was entitled to accept that repudiation and thereby press the Proceedings (irrespective of the fact that the appellant had subsequently been placed into the role of Assistant Equipment Management Officer). 1. Commissioner Murphy rejected the appellant's arguments in upholding the notice of motion. Firstly, he rejected the appellant's argument that the Deed was not a concluded agreement in that the effect of the report back mechanism was to enable him to opt out of the Deed if he found the role of Assistant Equipment Management Officer unsuitable. In this regard Commissioner Murphy reasoned (Primary Decision at [20]): "I reject the submission put on behalf of the appellant to the effect that the intention of clauses 3.1-3.5 of the Deed was to permit the appellant to come back before the Commission on 14 April 2020 and pursue his disciplinary appeal if he found the role of Assistant Equipment Management Officer unsuitable. It is not entirely clear to me what the purpose of clauses 3.1-3.5 is, but I reject the submission that they effectively allow the appellant to opt out of the terms of the Deed. I am reinforced in this conclusion by the clear wording of paragraph E under the heading 'Background' and clauses 1.1, 1.2, 1.4, 1.5 and 2 of the Deed which disclose the parties' intention that the terms of the Deed would bring to an end the appellant's disciplinary appeal. It is more likely that the purpose of clauses 3.1-3.5 was to allow the appellant to come back before the Commission to ventilate any concerns he may have had with the manner in which the terms of the Deed had been implemented, or to deal with any 'loose ends', rather than to re-agitate his disciplinary appeal on the basis that is acceptance of the role of Assistant Equipment Management Officer was for a trial only and he now regarded the position as not suitable." 1. Secondly, Commissioner Murphy determined to reject the appellant's argument that the respondent had repudiated the Deed by initially placing the appellant into the role of Technical Officer before placing him in the role of Assistant Equipment Management Officer. In this regard Commissioner Murphy reasoned (at [21]-[24]): "It was unfortunate that Chief Superintendent Stubbs initially placed the appellant in the Technical Officer role rather than the Assistant Equipment Management Officer role as was required by the terms of the Deed. However, the situation was quickly rectified. During the teleconference on 17 April 2020 between the appellant, Chief Superintendent Stubbs and Ms Patricia Lenahan, Principal Legal Strategist, Employee Relations, FRNSW, the appellant was asked if he would accept moving to the Assistant Equipment Management Officer role as outlined in the Deed. He declined. He was then asked if he would accept any Operational Support Level 2 role in Logistics (i.e. Equipment, Hazmat or Rescue). The appellant stated that he didn't want any role in Logistics. He stated that the job was not what he was expecting and he only accepted it on a trial basis. As stated above, I reject this construction of the terms of the Deed. Following the further teleconference on 2 July 2020, the appellant was transferred into the Assistant Equipment Management Officer role and at the time of the hearing of this matter on 4 August 2020, was continuing to work in that role. The appellant has benefited considerably from the terms of the Deed. He has accepted, and continues to accept, the significantly higher weekly rate of pay than was originally determined by Deputy Commissioner Fewtrell with effect from 6 August 2019. I do not regard the temporary hiatus in placing the appellant in the Assistant Equipment Management Officer role as constituting a repudiation of the Deed by FRNSW. I agree with the submissions of the respondent to the effect that the terms of the Deed constitute a bar to the appellant proceeding with his disciplinary appeal." 1. It was with this reasoning that Commissioner Murphy dismissed the Proceedings (at [25]). Appellant's case 1. The appellant relied upon an Amended Application for Leave to Appeal and Appeal filed on 3 December 2020 (the Appeal Application). The Appeal Application provided: F. The questions raised by the appeal are: 1. Did the Commissioner err in finding that there was a binding settlement agreement exist between Fire + Rescue and Mr Fraser such that Mr Fraser was precluded from continuing with his public sector disciplinary appeal? 2. Did the Commissioner err in finding that Fire + Rescue's conduct did not: a. constitute a repudiation of any settlement agreement. b. otherwise prevent it from relying on same? G. Reasons why leave to appeal should be granted: 1. The decision is affected by error and it is in the public interest that his be corrected. 2. The appeal raises question s general public importance being the correct approach to construing the terms and effect of non-monetary settlement agreement, in the face of non-or partial compliance. H. Grounds of the appeal are: 1. The Commissioner erred in his determination that a binding settlement agreement had been reached between the parties precluding Mr Fraser from continuing with his appeal. 2. Alternatively, the Commissioner erred in finding that Fire + Rescue: a. had not repudiated the deed of release between it and Mr Fraser; and b. remained entitled to rely on it as a bar to the proceedings continuing. 1. The appellant relied upon written submissions filed on 6 May 2021 in support of his application for leave to appeal. The appellant also relied upon written submissions in support of the appeal (appellant's submissions) filed 12 April 2021 and written submission in reply filed 24 May 2021 (appellant's reply submissions). The appellant also addressed the Full Bench at the hearing of the appeal on 18 June 2021. Respondent's case 1. The respondent relied upon written submissions filed 7 May 2021 (respondent's submissions) and addressed the Full Bench at the hearing of the appeal on 18 June 2021. Leave to appeal 1. Section 188 of the Act requires that leave to appeal is required in this matter and that such leave may only be granted if the Full Bench is of the opinion that the matter is of such importance that, in the public interest, leave should be granted. 2. The applicable principles in deciding whether to grant leave are well settled and were summarised in Public Service Association and Professional Officers' Association Amalgamated Union of New South Wales v Roads and Maritime Services [2015] NSWIRComm 16 at [10]-[11]. In summary: 1. an appeal under the Act is an appeal in the strict sense, and the Full Bench will only intervene to correct error; 2. leave will not be lightly or automatically granted, unless substantial issues of principle or law are raised, or there are otherwise wider implications for the jurisprudence of the Commission or the proper administration of justice; and 3. where an appeal primarily challenges finding of fact leave will rarely be granted. 1. In this matter, the appellant argued that leave should be granted because the Primary Decision (appellant's leave to appeal submissions): 1. is, in respect of non-discretionary matters, significantly affected by error, and it is in the public interest that this be addressed; 2. raises issues with broad consequences for the proper administration of justice, and in particular the operation of the Commission's conciliation function; 3. has implications beyond the applicant, extending at least as far as respondent's employees and likely further, in that it relates to the obligations imposed on state-system employers in respect of compliance with agreed settlement outcomes; and 4. raises questions of law and practice which do not appear to have been considered by a Full Bench before. 1. Having considered the Grounds of Appeal, we have decided not to grant leave to appeal in this matter. Did Commissioner Murphy err in his determination that a binding settlement agreement had been reached between the parties precluding the appellant from continuing with his appeal? 1. The appellant submitted the following with respect to the Deed ([6]-[7] of the appellant's submissions): "6. The parties codified the above in a deed on 24 February 2020. Relevantly, the deed: a. at 1.2, required Fire + Rescue to: i. rescind the disciplinary decision and replace it with a decision reducing Mr Fraser in difference in salary; ii. back-pay Mr Fraser the difference in salary; iii. create an ongoing placement for him at Greenacre as Assistant Equipment Management Officer; iv. place him in that position by 11 March 2020; and v. preserve his position at Beecroft until 14 April 2020. b. at 3.1, noted that a report-back was listed for 14 April 2020; c. at 3.2, required Mr Fraser to advise as to whether the reportback was needed by 7 April 2020; d. at 3.3, noted that, in the event that Mr Fraser indicated that the report-back did not need to go ahead, the proceedings would be taken to be discontinued; and e. at 3.4, obliged Mr Fraser to arrange to have a notice of discontinuance filed within 3 days of 8 April 2020 unless the requested report-back went ahead. 7. In other words, two options emerged. Either: a. the proceedings would be discontinued; or b. at Mr Fraser's election, they would not." 1. The applicant submitted the following with respect to the interpretation of the Deed ([19]-[26] of the applicant's submissions): "19. The fundamental difficulty with the construction of the deed as a final settlement of the proceedings is found at its central feature: it did not impose an absolute obligation on Mr Fraser to discontinue the proceedings. 20. The obligation to discontinue was, per cl.3.3 and 3.4, subject to Mr Fraser doing precisely what he did: electing to bring the matter back before the Commission. 21. In other words, it presents two paths: either the settlement would stick, and the matter would be resolved and discontinued accordingly, or it would not. 22. Contrary to Murphy C's conclusions at [20], the text does not limit in any way the reason that the matter might be brough back to the Commission, or what powers the Commission might thereafter exercise. 23. Parties referring a matter to the Commission can be understood to take the Tribunal as they find it, including the full scope of its statutory powers: DP World Brisbane v Maritime Union of Australia (2013) 237 IR at [47]-[48]. 24. In this light, the unlimited option to, in lieu of discontinuing the proceedings, return to the Commission is correctly interpreted as allowing access to the full range of the Commission's powers – including, ultimately, the determination of the substantive matter. Fundamentally, read in context, the purpose of returning was to have the Commission do something – not simply to act as an agony aunt while concerns were ventilated. 25. The lack of finality is further evidenced by the maintenance of Mr Fraser's pre-agreement Beecroft position, which only has utility if it preserved an option to return to this – i.e. for the settlement to fail. 26. Correctly construed, the agreement was not final. Instead, it presented two options, one of which involved Mr Fraser re-agitating his substantive case. In finding others, the Commissioner erred." 1. The appellant's argument that the Deed did not constitute a final settlement is not sustainable. 2. As the NSW Court of Appeal said in Mainteck Services Pty Ltd v Stein Heurtey SA (2014) 89 NSWLR 633 at [57]: "57. …A court should strain to give effect to one obvious aspect of the shared and objectively manifested intention of the parties - namely, that they had created contractual relations. It is a signal element of the obligation of courts to approach the task of giving legal meaning to commercial contracts with 'business commonsense': Antaios Compania Naviera SA v Salen Rederiema AB [1985] AC 191 at 201. There are indubitably cases where there may be a real contest about what amounts to business commonsense: Franklins Ply Ltd v Metcash Trading Ltd [2009] NSWCA 407; 76 NSWLR 603 at [20], but the fact that the parties had, by executing pages described as a contract, entered into contractual relations with one another is not one of them." 1. The fact that the parties went to the effort of creating and executing a Deed is clear and objective evidence that the parties intended to be bound by its terms. A deed of release is binding on a party when it has been signed, sealed and delivered by that party to the other parties to the deed. In the present case, the appellant executed the Deed and delivered it to the respondent on 24 February 2020. The appellant was bound by its terms from that point. Clause 6 of the Deed expressly records that the Deed binds the parties. 2. The appellant warranted in clause 7 of the Deed that he entered it voluntarily, having been given the opportunity to take legal and financial advice as to its nature. Indeed, the appellant had the advice and assistance of his union representative who is a legal practitioner. 3. The appellant also argued that the on a proper interpretation of the Deed, it provided the appellant with two options, namely to either discontinue the Proceedings or not. This seemed to somewhat contradict the appellant's submission that the Deed was not enforceable. This aspect of the appellant's case requires the Full Bench to construe and interpret the terms of the Deed. 4. The principles governing contractual interpretation are uncontroversial and have been articulated in numerous High Court authorities, including Electricity Generation Corporation v Woodside Energy Ltd (2014) 251 CLR 640 at [35] as follows: "[T]he objective approach [is] to be adopted in determining the rights and liabilities of parties to a contract. The meaning of the terms of a commercial contract is to be determined by what a reasonable businessperson would have understood those terms to mean ... [l]t will require consideration of the language used by the parties, the surrounding circumstances known to them and the commercial purpose or objects to be secured by the contract." 1. These principles were recently reaffirmed in Rinehart v Hancock Prospecting Pty Ltd (2019) 93 ALJR 582; [2019] HCA 13 at [44] where the plurality stated: "[i]t is well established that a commercial contract should be construed by reference to the language used by the parties, the surrounding circumstances, and the purposes and objects to be secured by the contract." 1. The NSW Court of Appeal recently applied these principles to the construction of a deed in Wollongong Coal Ltd v Gujarat NRE India Pty Ltd (2019) 100 NSWLR 432. At [70] the Court observed: "Although there are important differences in deeds and contracts, there is no reason to suggest that construction - the process of fixing the contractual words with legal meaning - is any different (to take but one example, Rinehart v Hancock Prospecting Pty Ltd involved the construction of a deed). 1. The appellant argues that the Deed, provided the appellant with two options, namely, that he would be able to discontinue the Proceedings, or not. It was implicit in this argument that the respondent would still be required to fulfil all its obligations under clause 1.2 of the Deed (including rescinding the disciplinary decision that formed the basis of the Proceedings, replacing it with a new decision, back-paying the appellant the shortfall, and creating a new role for the appellant) regardless of whether the appellant elected to continue the Proceedings or not. 2. We do not accept the appellant's construction of the Deed for the following reasons. 3. The construction contended for by the appellant requires a number of the clauses of the Deed to be ignored, or to be read as meaning something other than what they say or require the reading in of words that are not contained in the Deed. For example, in the appellant's submissions in reply, it was contended that the respondent's construction (at [3]): "only survives if one completely ignores the matters in 3.1-3.4. What utility is there in preserving Mr Fraser's substantive position at Beecroft unless the purpose was to give him an option to return to it? What point is there to a choice between discontinuing the proceedings and bringing them back to the Commission if the latter, as Fire + Rescue posits at [51]-[52], only provides a secondary means of achieving the same outcome?" 1. However, clause 2 of the Deed, Release and discharge, must be given meaning. It provides: "2. Release and discharge SF Fraser and the FBEU unconditionally releases and discharges FRNSW and its officers, employees, servants, agents, assigns and insurers from any and all Claims, no matter how the same arose, and on every count, which now exist including in relation to the Misconduct Outcome and the Proceedings, which, but for this Deed, exist at the date of this Deed." 1. Recital B of the Deed defines "Misconduct Outcome" as the respondent's decision to impose a disciplinary penalty of demotion and remove the appellant from his role as Deputy Manager ComSafe Training Services to a Senior Firefighter position in respect of sustained allegations of bullying and harassment and to issue a disciplinary reprimand in respect of a sustained allegation that he had disobeyed a lawful direction. The term "Proceedings" is defined in recital D of the Deed as "matter no. 2019/254133 before the Industrial Relations Commission (IRC) of NSW", that is, the public sector disciplinary appeal the subject of the Primary Decision. 2. In addition to clause 2, subclause 1.1(c) of the Deed provides: "1.1 SF Fraser undertakes and warrants that he: Will not commence or attempt to commence any proceedings in any jurisdiction against FRNSW arising from any aspect of the Misconduct Outcome or the Proceedings against FRNSW: save as to his protected rights under the Workers' Compensation Act 1987." 1. Whilst the appellant is correct to observe that this clause relates to the commencement of proceedings, rather than the continuation of existing proceedings, read in conjunction with clause 2, these record the appellant's agreement not only to release the respondent from any existing claims relating to the Misconduct Outcome, including the claim that forms the basis of the Proceedings, but also to not commence any new proceedings against the respondent arising from any aspect of the Misconduct Outcome. In effect, they evidence a clear intent to "draw a line in the sand" and bring about an end to the controversy between the parties about the appellant's demotion. 2. During the hearing of the appeal, it was put by counsel for the appellant that clause 2 should not be read literally and as invoking the release at the time the Deed was executed. Instead, it was put that it should be read in conjunction with the clauses 3.1-3.4 as providing the appellant with the option of continuing with his claim: Tcpt, 18 June 2021, p 3 (29)-(35). 3. Neither clause 1.1 nor clause 2 are qualified in any way. For example, they are not expressed to be "subject" to any election of the appellant to exercise an "option" to continue the proceedings in accordance with clauses 3.1-3.4. 4. The effect of clause 2 in precluding the applicant from continuing in his claim is reinforced by clause 9.4 of the Deed which states that, "Every clause and sub-clause of the Deed will, where the context permits, be severable from every other without invalidating or affecting the remaining provisions of this Deed or the validity of that provision in in any other jurisdiction." 5. This reading of the Deed is also consistent with clause 1.8, which provides that nothing in the Deed prevents the parties to the Deed from stating that the proceedings are concluded. 6. Further, clause 9.3 articulates that both parties may rely on the Deed to resist any attempt by another party to commence "or continue" any actions, suits or "proceedings" in connection with any of the matters referred to in the Deed, including the matters referred to in the recitals, which, as noted above, include the Misconduct Outcome and the Proceedings. 7. It is important to reflect that the Deed was clearly brought into existence to resolve the Proceedings. Reading the provisions of the Deed as a whole, we have formed the view that the appellant agreed to release the respondent from the claim that forms the subject of the Proceedings as reinforced by recital E of the Deed which states: "The Parties have agreed to accept the terms and conditions set out in this Deed in full and final discharge of their respective obligations and in settlement of all facts or matters referred to or alleged in the Proceedings in accordance with the terms of this Deed." 1. We consider this construction of the Deed to be consistent with the principles espoused in Australian Broadcasting Commission v Australasian Performing Right Association Ltd (1973) 129 CLR 99 at 109, where Gibbs J said that if contractual "language is open to two constructions, that will be preferred which will avoid consequences which appear to be capricious, unreasonable, inconvenient or unjust," and that approach is to be followed "even though the construction adopted is not the most obvious, or the most grammatically accurate." 2. The construction contended for by the appellant produces an unreasonable and unjust result whereby the appellant may be entitled to continue with the Proceedings, notwithstanding that the respondent is obliged to take steps that are in the interests of the appellant and effectively rescinds the Misconduct Outcome including restoring the appellant to a different position and providing back-pay to him, pursuant to its obligations under the Deed. Such an arrangement would be "foolish" from a commercial and business perspective: see J Kitchen & Sons Pty Ltd v Stewart's Case and Carry Stores (1942) 66 CLR 116 at 124-125 (Latham CJ and McTiernan J); and Electricity Generation Corporation v Woodside Energy Ltd (2014) 251 CLR 640 at [35]. 3. Ms Saunders of counsel, who appeared for the appellant, argued that this was one of those rare cases where words should be read into an agreement, those words being the inclusion of the following at the commencement of clause 2: "On Mr Fraser electing to discontinue the proceedings per clause 3 below": Tcpt, 18 June 2021, p 5(23-24). The appellant contended that a literal interpretation of clause 2 of the Deed would have the effect of clause 3 having no work to do. Ms Saunders argued that "if this release ends the proceedings, all of pt 3 does not work. [It] can't be consistent with the objectively ascertainable objectioner [sic] and significant parts of Fire and Rescue's obligations make no sense, including the obligation to retain the senior firefighter position. It utterly frustrates the report back process. If this extinguishes his ability to agitate the dispute, Mr Fraser can't come back. He can't seek to have the Commission do anything": Tcpt, 18 June 2021, p 4 (20-32). 4. In support of the appellant's argument, the Commission was referred to the decision in Westpac Banking Corporation v Tanzone Pty Limited & Ors [2000] NSWCA 25 at [19]-[22] where the NSW Court of Appeal affirmed the legal principal that the terms of contracts should be construed so as to avoid an absurdity, with reference to the leading authorities for that proposition. The Commission was also taken to [36]-[46] of Dockside Holdings v Rakio [2001] SASC 78 where the Court found it appropriate to take a non-literal interpretation of a lease in circumstances where it was found that the drafter of the document had managed to "muddle up the syntax" in a clause such that it produced "a nonsense." 5. We disagree that there is a need to read into the Deed words that are not there. There is no obvious error in the drafting or an absurdity in the document that would warrant the Commission so doing. It is common for parties in Commission proceedings, having reached a settlement agreement, to request the Commission leave open the file until such time as the steps involved in finalising the settlement have been executed. It is not uncommon for a matter to be nominally adjourned, even though the parties have reached a binding agreement to settle the proceedings. It is also not unusual for the Commission to assist parties in "ironing out" issues associated with settlements, consistent with its functions as provided for by the Act. Additional words are not required to be read into the Deed for clause 2 and clause 3 to co-exist and operate sensibly. 6. Even if the appellant's contention is accepted that the Deed did not impose an absolute obligation on Mr Fraser to discontinue the proceedings, this is a different question to whether the appellant is entitled to continue to pursue his appeal through the Proceedings. As was submitted by the respondent, the Proceedings could be concluded in a number of ways and not only by the appellant filing a notice of discontinuance. Support for this can be found in the recent decision of the Commission in Liszt v Health Secretary in respect of Sydney Local Health District [2020] NSWIRComm 1030 (Liszt) at [34]-[35] where the applicant's argument that the settlement was conditional upon the signing of a Deed and filing a notice of discontinuance was rejected on the basis that these were "machinery steps to give effect to the agreed settlement and to bring these proceedings to an end." We agree with the respondent that clauses 3.1-3.4 should be interpreted as procedural only and should not be given a meaning that overrides the substantive rights and obligations of the parties under the Deed. 7. Finally, we note that during oral submissions, the appellant referred the Full Bench to the principles of equitable construction of deeds of release espoused by the High Court in Grant v John Grant & Sons Pty Ltd (1954) 91 CLR 112, and referred to obiter comments in Kirby J's dissenting judgement in Qantas v Gubbins (1992) 28 NSWLR 26 (Qantas) at pp 43-45. Specifically, in Qantas, Kirby J (at p 43) referred to the "well-established principle of equity that the general words of a release are limited always to such matter as were specially in the contemplation of the parties at the time when the release was given". This submission was not developed by the appellant and it is difficult to contemplate the relevance of the principle to this matter, where the parties were especially considering the Proceedings when they executed the Deed, even though the release is broad in its terms and reads as through it may well have "rolled off the word processor" without detailed consideration of its exact phrasing: see p 44 at C of Qantas. 8. Indeed, equitable principles are relevant to the Commission. Section 163(1)(c) provides that the Commission is to "act according to equity, good conscience and the substantial merits of the case without regard to technicalities or legal forms." In this matter, allowing the appellant to resile from the terms of the Deed would be inconsistent with that mandate, along with the objects of the Act contained in s 3(a) and (g) and the requirement that "the Commission must endeavour to settle the matter by conciliation": s 100E of the Act. There are compelling public interest reasons for ensuring that parties are bound by the agreements they make: see Dr Payne v The University of Sydney & Anor [2000] NSWIRComm 102 at [94]; Caleta Trpimir v Northern Sydney Area Health Service [1995] NSWIRComm 38 and Liszt at [38]-[40]. 9. For these reasons, the first ground of the appeal is without merit. Commissioner Murphy did not err in his determination that a binding settlement agreement had been reached between the parties precluding the appellant from continuing with his appeal. Did Commissioner Murphy err in finding that the respondent; (a) had not repudiated the deed of release between it and Mr Fraser; and (b) remained entitled to rely on it as a bar to the proceedings continuing? 1. The appellant made the following submissions in respect of the second and alternative ground of the appeal, namely that the respondent had repudiated the Deed and the appellant accepted the same (appellant's submissions at [27]-[34]): "Repudiation of an agreement occurs where a party, by their conduct, 'evinces an intention no longer to be bound by the contract or to fulfil it only in a manner substantially inconsistent with the party's obligations': Koompahtoo Local Aboriginal Land Council v Sapine (2007) 233 CLR 115. It is a significant matter; a party must be clearly unready or unwilling to perform the contract: Shevill v Builders Licensing Board (1982) 149 CLR 620. It is an objective test: the question is whether the conduct would have conveyed, to a reasonable person in the position of the other contracting party, renunciation of either the contract as a whole or a fundamental obligation under it. The non-repudiating party may accept the repudiation. By so doing, the contract is taken to have come to an end at the initiative of the repudiating party. Whether said acceptance does have this effect turns on a question of whether the conduct leading to it objectively constituted repudiation. Critically, post-acceptance conduct - a scramble to comply- is not relevant. Repudiatory conduct can only be cured prior to acceptance. It is apparent from [22] and [24] of the Decision that Murphy C, in reaching his conclusion that the agreement had not been repudiated, relied entirely on Fire + Rescue's post-acceptance conduct. In doing so, he erred. In this matter, Mr Fraser accepted Fire+ Rescue's repudiatory conduct no later than 14 April 2020. At this point, Fire + Rescue had: a. failed to comply with a substantive and specifically negotiated obligation under the deed, i.e. to place him in a particular kind of role in a particular location; b. made no attempt to rectify this once complaint was made; and c. gave no indication of an intention to cure the breach. It was an express refusal to perform. Inspector Stubbs simply made a decision to do something other than what was agreed, and at that point was staying with it. A clearer indication of a lack of willingness to comply cannot be imagined. Accordingly: a. Mr Fraser was entitled to accept the repudiation; and b. when he did, the agreement came to an end, such that it presented no bar to his proceeding with the substantive application." (emphasis as it appears in the appellant's submissions) 1. There is, in our view, a good argument that the respondent repudiated the Deed by placing the appellant in the role of Technical Officer, rather than the position of Operational Logistics working special projects assisting Equipment Logistics and Equipment Management (Position). 2. In our view, it is clear from the evidence of Mr Jeremy Stubbs, Chief Superintendent, that the respondent did not intend to place the appellant into the Position when he instead deployed him into the Technical Officer role because, "it became clear that the best role available for SF Fraser at the time was in the Hazmat team, due to the needs of several special projects allocated to that team": [9] of (Ex 1). This was a significant departure from the terms of the Deed, enough to demonstrate an intention to no longer be bound by it. In this regard, the conduct of the employer was of the type identified by the High Court in Koompahtoo Local Aboriginal Land Council v Sanpine Pty Ltd (2007) 233 CLR 115 at [44]: "…it may refer to conduct which evinces an unwillingness or an inability to render substantial performance of the contract. This is sometimes described as conduct of a party which evinces an intention no longer to be bound by the contract or to fulfil it only in a manner substantially inconsistent with the party's obligations. It may be termed renunciation. The test is whether the conduct of one party is such as to convey to a reasonable person, in the situation of the other party, renunciation either of the contract as a whole or of a fundamental obligation under it." (footnotes removed) 1. However, as stated in Whittaker v Unisys Australia Pty Ltd (2010) 192 IR 311 at [36]-[40]: "A repudiatory breach does not automatically terminate the contract but confers an elective right of termination on the innocent party. I note that, at least in England, there was once a rule that, in relation to contracts of employment, an exception applied such that repudiation in itself brought the contract to an end without any requirement for its acceptance. But the doctrine of automatic termination of employment contracts is now out of favour. In Thomas Marshall (Exports) Ltd v Guinle Megarry VC referred to the practical difficulties which might arise from the application of a doctrine of 'automatic determination' of employment contracts and judicial opinion in England has now swung against the doctrine. In Australia the position is settled. In Automatic Fire Sprinklers Pty Ltd v Watson the High Court preferred the elective approach rather than the doctrine of automatic termination. This position has been followed in subsequent cases and recently confirmed by a majority of the High Court in Byrne v Australian Airlines Ltd. A repudiatory breach may be retracted or cured by the party in breach, but only prior to the exercise by the innocent party of the right to terminate the contract. An election to terminate for breach puts an end to the contract from the time of its communication and thereafter the breach cannot be cured or retracted. As at the end of the contract both the terminating party and the party in breach are released from all further performance of the contract, though accrued rights and obligations remain intact." (footnotes omitted) 1. The appellant submitted that he accepted the respondent's repudiation of the Deed, no later than 14 April 2020: see appellant's submissions at [32]. This was more than a month after the appellant commenced in the Technical Officer role and followed the appellant's acceptance of the benefit of his rank being increased to Operational Support Level 2 effective from 6 August 2019 and associated back-pay. In our view, the appellant's delay in conveying the acceptance of the repudiation and his implicit acceptance of the other benefits associated with the Deed had the effect of conveying through his conduct that he did not intend to accept the respondent's repudiation of the Deed: Gunton v Richmond-upon-Thames London Borough Council [1981] 1 Ch 448 at pp 467-468. If the appellant was to accept the repudiation, he was obliged to do so in a timely manner: see Foran v Wight (1989) 168 CLR 385 at pp 458-459. 2. Given our analysis of the appellant's grounds of appeal, we can see no reasons to grant leave to appeal. We would have come to the same conclusion as Commissioner Murphy and this appeal does not raise any significant issues with implications beyond the matter itself. Accordingly, we refuse leave to appeal. Orders 1. The Full Bench makes the following orders: 1. Leave to appeal is refused. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 14 April 2022