Local Court New South Wales Medium Neutral Citation: Personnel Concept WA Pty Ltd v J B Adam & Ors t/as Marsdens Law Group [2018] NSWLC 19 Hearing dates: 9-10 May 2018 Date of orders: 21 June 2018 Decision date: 21 June 2018 Jurisdiction: Civil Before: Magistrate Huntsman Decision: Verdict for the Defendant Catchwords: CONTRACT - Formation of contract – offer and acceptance – terms contained in attachment to an email – whether terms brought to attention of recipient – whether a legally binding agreement Cases Cited: Danckert v Tonkin [2015] NSWSC 1570 MacRobertson Miller Airline Services and Commissioner of State Taxation (Western Australia) (1975) 133 CLR 125 Masters v Cameron [1954] HCA 79 Mushroom Composters Pty Ltd v IS & DE Robertson Pty Ltd [2015] NSWCA 1 Toyota Motor Corp Australia Ltd v Ken Morgan Motors Pty Ltd [1994] 2 VR 106 Category: Principal judgment Parties: Personnel Concept WA Pty Ltd (plaintiff) J B Adam, J H Marsden, A J Seton, D R Baird, T C Reeve, G Bonura, P J Crittenden, G P Butterfield, N Youssef and J R Thornton t/as Marsdens Law Group (defendant) Representation: Counsel L Fermanis (for the plaintiff) B Debuse (for the defendant) Solicitors: C Roth (for the plaintiff) A Johnson (for the defendant) File Number(s): 2016/342065 Publication restriction: Nil Judgment Background 1. These proceedings involve a dispute about payment of professional fees for a service allegedly provided to a law firm by one, or both, of two recruitment firms, in relation to the recruitment of a solicitor. The recruitment firms are – Personnel Concepts WA Pty Ltd (PCWA) and Personnel Concept Group Pty Ltd (PC Group). The law firm is JB Adam and Others trading as Marsdens Law Group (Marsdens). The solicitor who was recruited to work at Marsdens is Mr Leith. Each of the plaintiffs, PCWA and PC Group, conduct a business in personnel recruitment. The plaintiffs are separate companies but at times work together. 2. Ms Felicity McManus is an employee of the first plaintiff, PCWA, and has worked as a recruiter for several years. Ms McManus is based in Perth, Western Austrlia. Mr Albert de Bruyn is employed by the second plaintiff, PC Group, and is based in Sydney, New South Wales. 3. Mr Leith, solicitor, was working in Western Australia but was searching for employment in Sydney with a view to relocating. As part of that process he became involved with the plaintiffs and the defendant (Marsdens). Mr Leith is currently an employed solicitor with the defendant. 4. Mr de Bruyn became aware of a commercial litigation position at Marsdens because Mr de Bruyn saw an advertisement for the position, which was placed by Marsdens on the website, seek.com. Mr Johnson, a partner at Marsdens, caused an advertisement for a commercial litigation solicitor to be placed on seek.com by the Human Resources (HR) department of Marsdens; this occurred on or about 22 February 2016. 5. Mr Butterfield is a senior partner with Marsdens who was contacted by Mr de Bruyn. It is not disputed that Mr Butterfield received an unsolicited phone call from Mr de Bruyn about the advertised litigation position, and that during this phone call Mr de Bruyn sought to bring a possible candidate to the attention of Marsdens. Mr de Bruyn subsequently sent an email to Mr Butterfield, which Mr Butterfield forwarded to another partner in his firm, Mr Johnson. Mr Johnson conducted a telephone interview with Mr Leith. These matters are further detailed below. 6. Mr Leith was independently seeking employment and was regularly checking the website, Seek, for available positions. In February 2016 Mr Leith saw a role, on Seek, for a Commercial Litigation position in Sydney. The contact on the advertisement was Albert and there was a mobile phone contact number. The advertisement was under a logo "Lawjobs.Go" and the contact was "Albert@Lawjobs.com.au." Mr Leith contacted Albert (who was Albert de Bruyn) about the job and was advised by Albert that he was a recruiter, and was recruiting for a position with a law firm in Sydney. The details of the conversation will be further set out below. As part of the conversation Albert requested a copy of Mr Leith's CV. There was a further phone call in March 2016 during which Mr de Bruyn advised Mr Leith that he was now searching for a candidate for a role with Marsdens Law group. Following the conversation with Mr de Bruyn, Mr Leith received an email from Mikayla Stone (of PCWA – the email was from "Personnel Concepts.com" but stated that Ms Stone works with Ms McManus). The email stated it was confirming that Mr Leith had consented to the recruiter providing his CV to both Marsdens and another other firm, Brown Wright Stein. Mr Leith then received a phone call from Felicity McManus who works for the first plaintiff, PCWA. 7. It is agreed that at the time of Mr de Bryun's unsolicited phone call to Mr Butterfield, he was in the snowy mountains region of New South Wales on a family holiday – Mr Butterfield states that the phone call occurred while he was driving in the alpine region, on 17 March 2016. Accommodation records evidence that Mr Butterfield was staying in the Snowy Mountains region from 17 March 2016 to 20 March 2016. The contents of the phone conversation are in dispute. What is agreed is that Mr de Bruyn made the phone call to Mr Butterfield, to introduce a candidate for advertised positions at Marsdens Law firm. Mr Butterfield's evidence is that he said that Mr de Bruyn could forward his candidate's CV but that no payment would be made by Marsdens as they do not use recruiters. Mr de Bruyn's version is that he told Mr Butterfield that he would forward the CV and the fee structure documents by email. The evidence about the phone call is further detailed below. 8. On 18 March 2016 Mr Butterfield received an email from Mr De Bruyn with three attachments. Mr Butterfield was on holidays, his evidence is that he forwarded the email without opening the attachments, to Mr Aaron Johnson. The forwarding email indicated to Mr Johnson that Mr Butterfield had agreed to Mr Johnson following up on the CV which had been forwarded. On 22 March 2016 Mr Leith participated in a telephone interview with Mr Aaron Johnson. Mr Leith and Mr Johnson state that during the interview Mr Johnson queried the role of the recruiters, and also Mr Johnson advised Mr Leith that the recruiters had no relationship with Marsdens. 9. Mr Leith, in response to a request from Felicity McManus, forwarded his academic transcript and referees to Ms McManus on 23 March 2016 and Ms McManus forwarded the material to Mr Johnson at Marsdens. Mr Leith states about a week later he received a call from Mr Johnson; there was some concern about the referee information which had been forwarded by Ms McManus, and Mr Marsden again indicated to Mr Leith that Marsdens had not engaged recruiter services. Mr Johnson advised Mr Leith during that phone call that they would be interested in offering him a position, subject to salary negotiations. It was after about another week that Mr Leith received a salary offer which was unacceptable to him, there were further negotiations and a salary review system was settled. An employment offer from Marsdens was accepted by Mr Leith. There were further communications between Mr Leith and the HR Manager of Marsdens in April 2016 and Mr Leith commenced employment with Marsdens on 30 May 2016. 10. It is agreed that there was a conversation between Mr Leith and Ms McManus in April 2016 where Mr Leith expressed concern that the plaintiffs had misrepresented their position in relation to Marsdens. The exact specifics of this conversation are in dispute although it is agreed that such a conversation occurred. 11. It is not in dispute that there was some ongoing contact in March 2016 between Ms McManus and Mr Leith. Mr Leith's evidence is that he believed Ms McManus was authorized to represent Marsdens, Ms McManus's evidence is that they were contracted by Marsdens in relation to the plaintiffs' presentation of Mr Leith as a candidate for the litigation position at Marsdens Law firm. The parties agree that Ms McManus forwarded some reference checks to Marsdens and that the plaintiffs facilitated a telephone interview. Other issues relating to communications between Ms McManus and Mr Leith are in dispute as detailed below. 12. Mr Johnson and Mr Leith agree that Mr Johnson advised Mr Leith that Marsdens were not represented by the plaintiffs, and that Marsdens were dealing with Mr Leith directly. They also agree that Mr Johnson queried the role of PCWA with Mr Leith, and advised Mr Leith that PCWA had no connection with Marsdens. 13. It is not in dispute that Mr Leith subsequently had a conversation with Ms McManus asking whether the plaintiffs were authorised to act on behalf of Marsdens, however the contents of the conversation are in dispute. 14. It is also not in dispute that Marsdens subsequently hired Mr Leith. The contentions of the parties 1. It is agreed that the email of 18 March 2016 was sent, and that it contained three attachments. What is disputed is that the fee statement in the attachment to the email constituted a binding contract - it is submitted by the defendant that it was an offer which was not brought to the attention of the defendant, and that the attachment to the email cannot be relied upon as representing a legally binding agreement between the parties. The attachments to the email are further detailed below. 2. The plaintiffs each claim, as alternative claims, the recovery of unpaid fees, being the fees specified in the fee statement attached to the email of 18 March 2016. The plaintiffs assert that the defendant engaged their recruitment services, employed their candidate (Mr Leith), agreed to a fee that was to be paid to the plaintiffs for the service provided, and failed to pay the agreed fee. The defendant asserts that there was no agreement for payment of a fee, or agreement to engage the plaintiffs' services, and therefore no amount is payable by the defendants to the plaintiff. 3. The defendant states there is no contract because no offer was communicated to them, and the terms upon which the offeror relied and the manner of acceptance were not reasonably brought to their attention. The defendant submits that the plaintiffs rely upon a document described as a 'Fee Structure" which was attached to an email which does not refer to it or otherwise bring its existence to the attention of the recipient. The defendant submits that the existence of the fee structure as an offer relies upon its communication to the defendants for its operation, and that this did not occur. 4. The plaintiff states that the issue of the fee was communicated by Mr de Bruyn to Mr Butterfield (this is disputed) and the fee statement document was a visible attachment to the email. The plaintiff's submit that it is not plausible that the attachment would not have been opened on receipt of the email. The plaintiffs also submit that there was acceptance of the agreement by the defendant, through the conduct of the defendant in accepting the services offered by the plaintiff. These matters will be further discussed below. 5. The plaintiff's legal representative concedes in written submissions that an issue in the case is which is the proper plaintiff. The evidence indicates that the terms and conditions sent to Marsdens in the attachment to the email were sent by Mr de Bruyn of PC Group; the initial invoice sent by the plaintiff seeking payment from Marsdens was issued by PCWA, and a subsequent invoice was issued to Marsdens on behalf of PC Group; the initial contacts with Mr Leith, and also with Mr Butterfield, were by Mr de Bruyn of PC Group, as was the facilitation of the interview; however Ms McManus was involved in communicating with Mr Leith and forwarding resumes and other post interview follow-up and she was an employee of PCWA. It is also conceded that PCWA and PC Group are separate companies and separate legal entities. Primary issue for determination 1. There is a primary issue to be determined in these proceedings - whether there was an agreement between the parties. The plaintiffs assert the agreement was made, the defendant states there was no binding agreement. This is a preliminary issue to determine, because the question of legal liability depends upon it being established that there was a contractual relationship between the parties. 2. A number of other issues were raised in the statement of claim, and the defence filed, in particular the defence also raised issues of consumer law and misleading conduct, however it is clear that these matters will only need to be determined if there is indeed a legally binding agreement between the parties. 3. The focus of these reasons for decision is to decide this issue as a preliminary matter. There was significant factual dispute, therefore some detail is required as to the evidence presented by the parties and the findings made on that evidence. Summary of evidence and findings of fact 1. In his first affidavit of June 2017, Mr De Bruyn describes his duties as consisting of locating suitable candidates, and offering those candidates to employers – he says the offer to employers is made on the terms and conditions contained in PC Group's fee structure. 2. During February 2016 Mr De Bruyn placed several advertisements on Seek (an on-line recruitment website) for a commercial litigation associate for various roles. He states on 23 February 2016 he received an SMS from Mr Leith enquiring about one of the advertised positions (on Seek). Mr Leith told Mr De Bruyn he was employed in a law firm in Perth and wished to move to Sydney, and was interested in the commercial associate role advertised. Mr De Bruyn says he does not have access to any record of the communications he had with Mr Leith at that time, as his phone was subsequently damaged. His evidence is based on his recollection of conversations and events, and any available documents such as emails. He requested Mr Leith send him his CV, which he received by email on 24 February 2016. The following day, on 25 February 2016, Mr De Bruyn states that he observed an advertisement by Marsdens for an associate for their Sydney Law office. He forwarded the information and a link to the advertisement to Felicity McManus by email on 25 February 2016. An email from Ms McManus to Mr De Bruyn of 29 February 2016 "Re Marsdens Info" states "I will call Joseph Leith". 3. Felicity McManus was employed by PCWA as a law recruiter, and Mr de Bruyn says they assisted each other. Ms McManus had been employed by PC Group previously. The assistance between them continued after Ms McManus moved to PCWA "notwithstanding we were now employed by different companies in accordance with, to my knowledge, an ongoing practice between employees of the companies". 4. Mr de Bruyn says that he understood from accessing Marsdens link on Seek at the time that Mr Grant Butterfield was a partner in charge of the relevant section of Marsdens, and Aaron Johnson was a partner in charge of the Sydney office. Mr De Bruyn states that on 17 March 2016 he telephoned Marsdens' main reception and asked to speak to Grant Butterfield, and was put through to a person who identified himself as Grant Butterfield. Mr De Bruyn agreed it was an unsolicited phone call. He says he introduced himself as being from Personnel Concept, a specialist recruitment company, and that he had two candidates for positions advertised by Marsdens' (being for an employment lawyer and a commercial litigator). He says Grant Butterfield said there were roles in litigation and workplace relations, the litigation role being in the Sydney office and the workplace relations role in the Campbelltown office. He says Mr Butterfield said that he would be more interested in the candidate with commercial litigation experience but would need to speak to the Sydney office partner and see the CV. There was some further conversation about whether the workplace relations candidate would be okay to work in Campbelltown. Mr De Bruyn says that he told Mr Butterfield "I will get back to you and send our fee structure with the CVs". 5. Mr De Bruyn says on 18 March 2016 at 2:46 pm he sent an email to Mr Butterfield attaching three documents: a letter from Mr De Bruyn, Mr Leith's CV, and PC Group's fee structure. He states he received an email reply sent on 18 March 2016 at 4:21pm (annexure 10 to his affidavit) which states "Albert, my partner will contact you re telephone hook up". 6. Mr Butterfield states that on 17 March 2016 he was on leave with his family in the New South Wales alpine region. While driving, he received a telephone call to his mobile phone from a person who identified himself as Albert from a firm called Personnel Concepts - "He was a fast talker and had little detail and my recollection is was desperate to send me a CV". 7. Mr Butterfield gave evidence that Albert introduced himself, saying that he worked for Personnel Concepts, and had seen a number of ads that Marsdens had placed for employees, and was calling about some potential candidates. Mr Butterfield states he replied "Albert, I'm on leave at the moment and am driving, so I can't speak freely. We have a policy of not engaging recruiters because I've had some bad experiences in the past". He said Albert replied "Yes. Grant I've got two candidates for you, one for the employment role …and one for the commercial litigation role". Mr Butterfield states he said "if you want to send me a CV that's up to you, but to be very clear, I'm not paying you and I don't engage recruiters". Mr Butterfield stated that Albert replied "okay, okay, these candidates are highest quality and very very keen to work with a firm like yours and…" Mr Butterfield says that he cut him off saying that his partner Aaron Johnson would look at it. Mr Butterfield details again stating that Marsdens would receive the CV, that the candidate could deal with the recruiter, Albert, but that Marsdens were not engaging the recruiters. 8. Mr Butterfield recalls that shortly after the phone call he received an email from Albert de Bryun, which he forwarded to Aaron Johnson – he says he did so without having regard to, or viewing, the contents of the attachments to the email. Under cross-examination he stated he was on holidays with his family at the time and would have received the email on his mobile phone and forwarded it on. 9. On 18 March 2016 Ms Felicity McManus had a conversation with Mr Leith about a litigation role with Marsdens. On 18 March 2016 at 2.28 pm Ms Makayla Stone sent an email to Mr Leith and Ms McManus, confirming that Mr Leith authorised "Personnel Concepts" to assist him in finding suitable employment. The email states: "I confirm by way of email that you have authorised Personnel Concepts to assist you in finding you suitable employment. You have consented to me to exclusively represent you and release your resume to the following prospective employers including: Brown Wright Stein and Marsdens". 1. The email of 18 March 2016 was sent by Mr de Bruyn at 2:46 pm to Mr Butterfield, following the phone call of 17 March 2016, and attached a letter and Mr Leith's CV, and the second plaintiff's terms and conditions, that is, terms and conditions of PC Group. Mr Leith's CV had been previously sent to Mr de Bruyn, on 24 February 2016, after Mr Leith had contacted Mr de Bruyn in response to Mr de Bruyn's advertising on Seek website for a commercial litigation associate. Mr de Bryun's email of 18 March 2016 to Mr Butterfield reads as an email introducing Mr Leith and summarising his work experience, and the email proposes a time for further contact by concluding "Joseph is available to speak 4 or 5pm Tuesday if that suits". 2. Shortly after receiving the email, at 2:48 pm on 18 March 2016 Mr Butterfield forwarded to Mr Johnson the email, including the attachments, sent to him by Mr De Bruyn. On 18 March 2016 at 4:21 pm, Mr Butterfield sent an email to Mr De Bruyn and Mr Johnson which said: "Albert… My partner will contact you read Tele hook up". The reference to tele hook up appears to be in response to the invitation to speak on Tuesday set out in Mr De Bruyn's email. 3. On 20 March 2016 Mr Johnson sent an email to Mr De Bruyn and Mr Butterfield which said: "4 – 5 pm on Tuesday is suitable Albert, can you advise the number I shall call". 4. On 22 March 2016 Mr de Bruyn sent an email to Mr Johnson confirming an interview would take place on 22 March 2016 with Mr Leith at 5 pm. Mr Johnson had a telephone interview with Mr Leith on 22 March 2016, Mr Johnson contacted Mr Leith directly and they had a conversation for about 40 minutes. Towards the close of the conversation Mr Johnson discussed with Mr Leith issues in respect of his application. He states that he advised Mr Leith that he might wish to find out what fee the persons who had put his name forward to Marsdens were seeking to charge him because he might need to factor that into the salary that he wished to be paid if given the position by Marsdens. He says Mr Leith stated "to be honest I do not know, they told me they were acting on an exclusive basis in respect of all roles that Marsdens have and that they are on a retainer?". Mr Johnson says that he told Mr Leith "we advertised this role on Seek. I do not know who these people are, you should speak to them". Mr Johnson went on to advise Mr Leith that he would need to obtain his academic transcript and referees and Mr Leith responded he would arrange for those to be forwarded. Mr Johnson gave evidence that he was dealing directly with Mr Leith in respect of his potential placement at Marsdens. 5. Mr Johnson recalls receiving an email on or about 23 March 2016 from a person who identified herself as Ms McManus which attached a reference and Mr Leith's academic transcript and he received a further email on 30 March 2016 from Ms McManus attaching a second reference for Mr Leith. On around 31 March 2016 he had a further telephone conversation with Mr Leith. The discussion raised concerns in respect of contradictions in the information in his written references. Mr Leith expressed concern that what had been forwarded to Mr Johnson was incorrect. Mr Johnson confirmed that he had not asked for written references, and had just asked for names so that Marsdens could directly contact the referees. Mr Johnson indicated he was happy to take Mr Leith's word about the written references being incorrect, and that they could continue to further discuss the position. In April there was a further telephone conversation between Mr Johnson and Mr Leith about the proposed employment at Marsdens. The salary was subsequently agreed and Mr Leith commenced employment in late May 2016. Mr Johnson became aware of an invoice sent to Mr Butterfield on about 14 June 2016 seeking payment said to be owing to PCWA. Mr Johnson said he was not made aware of any terms and conditions concerning the placement of Mr Leith at any time during his discussions with Mr Leith, nor in any correspondence from Ms McManus. Mr Johnson also states that he did not ever speak with Ms McManus and states that her affidavit evidence to the contrary is incorrect. Ms McManus had testified to a phone call with Mr Johnson asking how the interview went and that Mr Johnson asked her to get the references. 6. Ms McManus spoke by telephone with Mr Leith after the interview to ask how it went and discussed provision of referees to Marsdens, Mr Leith then forwarded some information to Ms McManus. On 23 March 2016 Ms McManus sent an email to Mr Johnson which said: "I have been working with Albert and Joseph in securing a new role for Joseph. Joseph's feedback was positive and he enjoyed the time spent talking to you. As requested please find the first reference and transcript attached". 7. On 30 March 2016 Ms McManus sent an email to Mr Johnson stating "please find the second reference transcript for Joseph Leith as requested". Ms McManus stated in her affidavit that she tried to telephone Mr Johnson on several occasions without success. 8. Mr Leith's affidavit evidence gave a similar account of his conversation with Mr Johnson during the telephone interview of 22 March 2016 about the role of the recruiters. Mr Leith says that almost as soon as the interview was over he received a phone call from Ms McManus who asked him how the interview had gone, and that he had said to Ms McManus that as far as he was aware he had not engaged their firm, but had only provided a CV. He says Ms McManus said that their recruitment firm had been engaged by Marsdens, and that she had written confirmation in that respect from Mr Butterfield. Ms McManus then told Mr Leith, according to Mr Leith, that the recruiter is always acting on behalf of the employer. Mr Leith states that he agreed to provide his references to Ms McManus in response to a request from her to do so, but says that he also suggested to her that there was a need to clarify the position with Marsdens. Mr Leith states that he also requested a copy of her retainer agreement with Marsdens and that she indicated she would forward same. 9. Mr Leith stated that in a subsequent phone call with Mr Johnson, Mr Johnson asked him why the recruiters had forwarded the referee information, this was in the context of a discussion that some of the information in a written reference provided by the recruiter was incorrect. Mr Leith said he told Mr Johnson that he was assured that the recruiter was working for Marsdens, and that Mr Johnson said to him that they had not engaged the recruiter. 10. Mr Leith states that there were then ongoing conversations with Marsdens over several weeks before he accepted a position at Marsdens, and during this time he did not hear from the plaintiffs about the role at Marsdens. 11. Mr Leith gave evidence of a conversation with Ms McManus in April 2016 where he expressed concern that she had misrepresented the recruiters' position in relation to Marsdens, and that Marsdens had stated that they were not engaged to act for Marsdens. He states that he said to Ms McManus that she had never provided proof of the written agreement with Marsdens. He says he told her he was not comfortable with the recruiters continuing to possess his information and asked for the recruiter to destroy his records. 12. Attached to Mr Leith's affidavit were various text messages and phone call logs as to contacts with Mr de Bruyn and Ms McManus. 13. Ms McManus gave different versions of the conversations with Mr Leith but she did agree that Mr Leith had contacted her expressing concern about whether the recruiters were acting for Marsdens. 14. It seems, on the evidence, that Mr Leith could only have made this enquiry if it had been indicated to him, as testified by both Mr Leith and Mr Johnson, that the plaintiffs were not authorised to act for Marsdens. On the evidence the conversations with Mr Johnson were the only source which could have led to Mr Leith making this enquiry of Ms McManus. 15. Under cross-examination, Ms McManus's version of various conversations, which were contained primarily in a second affidavit written in response to Mr Leith's affidavit, were put to Mr Leith. He made various concessions that parts of those conversations may have occurred, however he maintained that Ms McManus had continued to assert that she was retained by Marsdens on written authority of Mr Butterfield. 16. On 14 June 2016 Ms McManus sent an email to Mr Butterfield enclosing a tax invoice in the name of the first plaintiff, PCWA. On 7 June 2017 Ms McManus sent an email to Mr Johnson enclosing a tax invoice for the same amount in the name of PC Group. 17. Mr Butterfield attaches to his affidavit a letter which he wrote on 30 June 2016 in response to correspondence from Ms McManus in June 2016. This letter sets out Mr Butterfield's position and also contains a section entitled "Outline of Evidence – Joseph Leith". During cross examination of Mr Leith, he stated this outline would have been based on a written memo he provided to Mr Butterfield at the time, that Memo was called for and produced and subsequently tendered. The Memo supports the "Outline of evidence – Joseph Leith" set out in the letter of Mr Butterfield of June 2016. 18. In particular the letter states that Mr Leith was told by Albert de Bruyn that Mr de Bruyn was acting for Marsdens on an exclusive basis in relation to a commercial litigation role. This is consistent with Mr Leith's evidence in his affidavit, which was maintained under cross examination. Mr de Bruyn denies that he said this. The letter also sets out that Mr Leith was told by Mr Johnson that there was no recruitment agency acting for Marsdens, and that Mr Leith was asked to provide references and an academic transcript directly to Mr Johnson. The letter also outlines that immediately after the interview Mr Leith was contacted by Ms McManus and he informed her he was concerned that her firm was not engaged by Marsdens. The letter sets out that Mr Leith asked Ms McManus to confirm the relationship with Marsdens and that Ms McManus told Mr Leith that she had written confirmation from Grant Butterfield that they were acting for Marsdens. 19. Mr Leith was told by Ms McManus that she was required to send the referees and transcript directly to Marsdens and therefore he provided same, this was also consistent with Mr Leith's evidence in the proceedings. The letter outlines that in about April 2016 Mr Leith telephoned Ms McManus to say he was uncomfortable with the way the firm had indicated they acted for Marsdens. The letter, supported by the memo written at the time by Mr Leith, was written proximately to the events in question. The evidence given by Mr Leith was consistent with what was contained in the letter prepared by Mr Butterfield and sent to Ms McManus in June 2016. That letter also records Mr Butterfield's account that he had been contacted while driving in the New South Wales alpine region in March 2016 and was annoyed because it was an unsolicited call, and that Mr de Bruyn was very enthusiastic. Mr Butterfield set out in the correspondence of 30 June 2016, that Mr de Bruyn had offered to send a CV, and that he had told Mr de Bruyn that was his decision, but that Mr Butterfield would not pay Mr de Bruyn to find any candidate. The letter also sets out Mr Butterfield's view that at no time had Marsdens agreed to engage Ms McManus or her firm or Mr de Bruyn, and that there was no agreement between Marsdens and the recruiters, for the recruiters to find Marsdens a candidate. 20. Under cross-examination Ms McManus stated her view that Marsdens was bound by the terms and conditions which had been forwarded to Marsdens in an attachment to an email from Mr de Bryun on 18 March 2016. She agreed that she had not at any time sent to Marsdens, or referred in any of her direct contacts with Marsdens, to the terms and conditions, this was despite her evidence that transparency and a clear statement of fees was important in business. It was put to her that it was unfair to send a CV, and to not draw attention to the fact that there was a fee agreement attached which would cause fees to be levied if a candidate was employed. She indicated that she did not think this was unfair. She was asked whether it was legitimate, and her response was that the CV was requested by Mr Butterfield. She was questioned about her recollection as set out in both her affidavits, including that she had provided detailed evidence of specific conversations which had occurred over one year previously, and she maintained that her recall of the substance of the conversations was accurate. The email and attachments 1. The email was sent by Mr De Bruyn to Mr Butterfield on 18 March 2016 at 2.46pm. The email contains three attachments. The attachments are labelled "image001jpg; ATT00001.htm; Butterfield – Marsdens Law Group – Leith.pdf; ATT00002.htm;CV Leith Joseph.pdf; ATT00003.htm; Marsdens Law Group Fee Structure pdf; ATT0004.htm" 2. The email itself makes no reference to any fee agreement, and no reference to any contingency fee structure, such as that which is set out in the fee schedule. Nor is any reference made in the text of the email to any offer or agreement to act for Marsdens in recruiting a solicitor. The email reads as an introduction of Mr Leith, describing his work experience, and proposing a time to speak to Mr Leith. Personnel Concept is not mentioned at all in the text of the email, it is all about Mr Leith. The only reference to Personnel Concept is at the sign off part under Mr de Bruyn's name, and also in the subject box of the email "Personnel Concept – Joseph Leith – Commercial Litigation Solicitor". Nowhere in the email text is any mention made of anyone other than Mr Leith, nor are the attachments to the email referred to in the text of the email. 3. The title of the attachment to the email (by which a document setting out a fee structure, is attached to the email, which is the Fee Agreement relied upon by the plaintiff) does not identify the attachment as relating to a fee charged by PCWA or PC Group, rather the document is entitled "Marsdens Law Group Fee Structure". 4. The three attachments to the email are reproduced in full as annexures to the affidavit of Mr de Bruyn. 5. In brief the attachments include, at Attachment 2, a two page letter from Personnel Concept.com.au to Marsdens Law Group, "Attention Grant Butterfield". The letter opens with a reference to Mr Leith's CV being forwarded and the entire first page describes Mr Leith's work experience and wish to relocate to Sydney. Page 2 has two short paragraphs, the first of which begins "Attached find the Curriculum Vitae (this has already been stated at the beginning of page 1) plus our companies fee structure, which contains all our terms and conditions of business". The letter makes no mention until the second page of any fee agreement being in existence. The reference on page 2 of this letter to an attached fee agreement occurs after a lengthy first page which refers only to Mr Leith, the purported fee agreement was in fact attached to the email at attachment 3, and not to the letter which mentions it, that letter being also an attachment (attachment 2). As previously stated nowhere in the text of the email is any agreement to provide a service, or fee structure, mentioned. 6. The other attachments to the email are - Attachment 1 is a CV; Attachment 3 is a one page document, which although the attachment has the title "Marsdens Law Group Fee Structure" the one page document is actually entitled "Fee Structure – Contingency Basis – Effective 9 April 2011". This document, among other terms, states that "Your company becomes liable for an immediate payment of a fee once a candidate presented by Personnel Concept commences employment….". The document also states "For the purpose of clarity, an introduction can take place either telephonically or in writing, namely the receipt by email, fax, courier or post, of the requested Curriculum Vitae or similar document". 7. It is the plaintiff's position that on receipt of the email forwarding the CV and the fee agreement, the defendant became bound by the terms of the fee agreement. As noted above the plaintiff is also of the view that the evidence supports a conclusion that the defendant demonstrated acceptance of the terms by conduct. Such conduct included acceptance of the plaintiffs' facilitation of the telephone interview between Mr Johnson and Mr Leith, and the forwarding by Ms McManus of referees/academic transcript. Findings on the evidence 1. Mr Leith's evidence was based upon his recollection but he also had access to contemporaneous records in his mobile phone, and emails, and also in the form of a Memo provided to Marsdens close in time to the events (June 2016). 2. Mr de Bruyn's evidence was largely based on his recollection sometime after the events. Further, his evidence under cross-examination was inconsistent and he was reluctant on many occasions to reconsider his evidence in the light of other evidence, or to make any concessions in relation to his recall. Given the inconstancies in his account and his reluctance to make concessions as to his recall despite the passage of time since the events, I found his evidence to lack reliability. Where his evidence conflicted with Mr Leith's evidence, I prefer the evidence of Mr Leith, both due to the unreliability attaching to Mr de Bruyn's account and also because of the view I formed of Mr Leith's evidence. 3. Mr Leith's evidence was consistent, both internally as well as being consistent with extrinsic evidence such as phone records and a Memo written close in time to the events. Further he impressed me as a witness of credit – he appeared to be doing his best to give accurate and truthful evidence – this was demonstrated in the way that Mr Leith readily reconsidered his recollection of events and made various concessions under cross examination. 4. Mr de Bruyn appeared to be determined to adhere to a version of events even if it was demonstrated to be inconsistent with other evidence and this also indicated that his evidence may be unreliable. 5. Mr Butterfield's evidence that he did not open the attachments to the email as he was on holidays, and merely forwarded it to his partner, was consistent with the position detailed in the letter he prepared in June 2016, and was plausible in the circumstances of him being on a family holiday. Mr Butterfield's evidence that he told Mr de Bruyn that he would not engage or pay a recruiter, was also consistent with what was stated in the letter of June 2016, and was plausible, given the evidence of Mr Johnson that it was Marsdens' usual practice to recruit directly through their own HR department. It was also plausible that Mr Butterfield indicated he was not interested in a recruitment service during the initial phone call with Mr de Bruyn, given that Marsdens had been recruiting for that particular position through use of their HR Department and use of Seek; and given that Mr de Bruyn made an unsolicited call to Mr Butterfield about a position that had been advertised by Marsdens (such advertisement being without resort to any recruitment service). Mr Butterfield's evidence is consistent with Marsdens' actions of advertising the position themselves. Given the unreliability that attaches to Mr de Bruyn's evidence, and given the consistency of Mr Butterfield's evidence generally and its consistency with the evidence as to Marsdens' recruitment practices, and noting the plausibility of the evidence of Mr Butterfield, then, where there is a conflict in the evidence I prefer the evidence of Mr Butterfield. Also I note that Mr Johnson's evidence largely supported Mr Butterfield's account, and Mr Johnson's advice to Mr Leith that they were not using a recruiter, being evidence which I accept, also supports Mr Butterfield's account. 6. Mr Johnson impressed me as a credible witness – he made ready concessions under cross-examination and his evidence was in large part consistent with the evidence of Mr Leith, and I also found Mr Leith to be a reliable witness. 7. Ms McManus did not impress me as a reliable witness, she presented as a witness who was determined to adhere to a certain version of events. Her second affidavit, which was in response to the affidavit evidence of the defendant's witnesses, revisited the version of conversations which she had attested to in her first affidavit and added detail that was not present in the first affidavit. One might have thought that the full conversation should have been included in the first affidavit, and not in an affidavit in reply. Under cross-examination she would not make any concessions even where such a concession might have flowed from her previous answers – this was seen when she indicated her professionalism, her experience in the industry and her acknowledgment that fees need to be transparent, and yet still maintained that her actions in having no correspondence or conversation with Marsdens as to a specific agreement to act as Marsdens recruiter and the fee which would apply to such service, was suitable business practice. She continued to maintain the position that the process was consistent with appropriate business practice even when it was pointed out to her under cross examination that she relied upon an email she had not sighted, sent by an employee of a different company (Mr de Bruyn) for her position that she was contracted by Marsdens to recruit Mr Leith. She did not impress me as a reliable witness. She was reluctant to reconsider her recollection in the light of alternative evidence, and this was so even though her recollection was not being based on any contemporaneous notes of conversations, and the events occurred some time ago and during a period where she represented many clients and employers. The resistance to consider the possibility that her recall could be incorrect, coupled with her adherence to what appeared at times to be a constructed view of the events, caused me a level of dissatisfaction with her evidence . 8. For the reasons detailed I accept the evidence of Mr Butterfield as to the initial conversations, and Mr Leith as to his conversations with Mr de Bruyn and Ms McManus, and the evidence of Mr Johnson as detailed above. I find that neither Mr Johnson nor Mr Butterfield observed the terms and conditions that were in an attachment to the email. I am also satisfied that Mr Leith raised questions with Ms McManus after Mr Johnson clearly advised him that the recruiters did not act for them, and I am satisfied that Ms McManus continued to represent otherwise to Mr Leith. Legal Principles 1. The legal principles, being the law relating to formation of contract, were not in dispute in this matter. The parties agreed essentially that the authorities known as the "ticketing cases" may be of assistance in this matter. Reference was made to MacRobertson Miller Airline Services and Commissioner of State Taxation (Western Australia) (1975) 133 CLR 125 (MacRobertson). That case involved consideration of whether stamp duty was payable on the airline ticket, however it contained a useful review of authorities. The case affirmed the line of authorities that a ticket for carriage (e.g. on an aeroplane or train) was an offer, and if conditions are contained on the ticket and brought to the attention of the acceptor (the passenger) then, once the passenger accepts the contract by conduct such as travelling on the train, the passenger is bound by the conditions on the ticket which have been brought to the passenger's attention (see Barwick CJ at 133, Stephen J at 136-139, Jacobs J at 142-144). 2. As was stated by Stephen J in MacRobertson (at 139): It is enough to refer to three authorities, over a span of almost a hundred years, in which, when the ticket itself contains conditions or a reference to conditions elsewhere available, the passenger's acceptance of the carrier's offer is treated as occurring some time after issue of the ticket. In Parker v. South Eastern Railway Co. [32] Bramwell L.J., on three occasions referred to the passenger being afforded, if he wishes, the opportunity of reading the conditions on a ticket which is proffered to him before becoming bound by them, that is, before the contract can be regarded as concluded, and see also per Baggallay L.J. [33] . Then in Hood v. Anchor Line (Henderson Brothers) Ltd., Lord Finlay L.C. and Lord Parmoor both referred to this. Lord Finlay said that "when the passenger or his agent gets the ticket he may examine it before accepting, and if he chooses not to examine it when everything reasonable has been done to call his attention to the conditions he accepts it as it is"[34] . Lord Parmoor said: "If an intending passenger, either personally or through his agent, has reasonable notice that the ticket or document handed to him by a carrier contains certain conditions, and accepts the document or ticket as handed to him without objection, and without taking the trouble to make himself acquainted with such conditions, he must be taken to have assented to them"[35] , and see also per Viscount Haldane [36] . In the Shoe Lane Parking Case [37] Lord Denning refers to the acceptance of the ticket and its retention without objection as being regarded as an acceptance because of the theory "that the customer, on being handed the ticket, could refuse it and decline to enter into a contract on those terms". Megaw L.J. says, of customers of a car park to whom tickets are issued which refer to conditions displayed on the premises, that they must have "a fair opportunity, before the contracts are made, of discovering the conditions by which they are to be bound"[38] . Such a customer, who, by the issue of a ticket, becomes the recipient of an offer, must be afforded an opportunity of learning, from the ticket, what are the terms of that offer before he can be said to have accepted it. The cases, including some of the few passages which I have cited, are replete with references to passengers who elect not to read ticket conditions, no doubt the common behaviour of most passengers; they, it is said, do not thereby escape being bound by those conditions. This rule of law, which is directed to identifying the agreed terms of the particular contract, does not detract from but, rather, supports the proposition that acceptance, and the resultant formation of the contract, does not occur upon tender of the ticket. It occurs after that event, either when the passenger has by actual conduct intimated his acceptance of the offer, for instance by immediately boarding the vehicle in question, or, absent any such conduct, when a reasonable time has passed during which the passenger has had an opportunity of reading the conditions appearing on the ticket and has not then rejected the offer and demanded the return of his fare. In other words, acceptance will normally be by conduct and this conduct will consist either of an overt act consistent only with acceptance or, in its absence, of the passenger's failure to reject the offer after he has had an opportunity of learning of the conditions upon which carriage is offered. Those cases in which a contract is concluded which incorporates ticket conditions despite the passenger's failure to read them are instances either of the occurrence of such an overt act or of the passing of a reasonable time without rejection. In the latter case there is involved the concept of effective acceptance without actual communication to the offeror; but when, as here, the offeree, by tendering his, has performed his part of the bargain in advance his acceptance may fare readily be inferred from his failure, within a reasonable time after receipt of his ticket, to reject the offer and demand the return of his fare: Williston on Contracts, 3rd ed., vol. 1, par. 91C. What will be a reasonable time within which to reject proffered terms will be a question of fact in every case dependent upon all the circumstances, including, no doubt, the length and complexity of the conditions which form part of the offer. What Hawkins J., in Watkins v. Rymill [39] , and Megaw L.J., in the passage cited from the Shoe Lane Parking Case [40] , each referred to as "a fair opportunity" of reading the tendered ticket will provide the test, recourse being had, for this purpose, to familiar standards of reasonableness. 1. Both parties submitted that the "ticketing cases" were relevant to a determination of whether the terms and conditions contained in the attachment to the email constituted an agreement. The plaintiff states that the attachment to the email contained terms of an agreement between the parties and that the agreement was concluded by the acceptance by the defendant through the defendant's conduct in accepting the CV sent by email, and also in acceptance of the plaintiffs' assistance in scheduling an interview with Mr Leith and forwarding referees. The defendant states that the terms were not brought to its attention, there can therefore be no concluded agreement by which the defendant is bound; further the defendant states that there was no clear acceptance of the terms set out in the email attachment by any subsequent conduct of the defendant. 2. I was also referred to the decision of Sackar J in Danckert v Tonkin [2015] NSWSC 1570. That decision examined, amongst other issues, contract law relating to the existence of a binding agreement and the intention of the parties to be bound. A number of authorities were referred to. His Honour stated at [124]-[125]: It is apposite to begin with the remarks of Higgins J in Barrier WharfsLtd v W Scott Fell & Co Ltd (1908) 5 CLR 647 at 650: If there was no complete contract, the plaintiffs must fail. The law knows no gradations in the contractual relations. It knows nothing of virtual agreements, or honourable understandings. Even if the defendants were shown to have disappointed the legitimate expectations of the plaintiffs for some unworthy reason – to have meanly backed out of almost completed negotiations – the action must fail. There is no contract unless the two parties mutually consented to be bound one to the other by one agreement. Moreover – though it ought to be superfluous to say it – it is one thing for two parties to settle what are to be the terms of an agreement, if it should be made; and quite another thing to make the agreement. I have found, in my experience, that the two processes are frequently confounded; and, if I may judge from some of the cases to which I have been referred by Mr. Starke, the confusion has not always been avoided even in the Courts. In Air Great Lakes Pty Ltd v K S Easter (Holdings) Pty Ltd (1985) 2 NSWLR 309, Mahoney JA considered: The only question considered by Yeldham J was whether there was a binding contract between the parties. In considering this question, in a context such as the present, it is of assistance to distinguish between three questions: did the parties arrive at a consensus?; (if they did) was it such a consensus as was capable of forming a binding contract?; and (if it was) did the parties intend that the consensus at which they arrived should constitute a binding contract?: cf Barrier Wharfs Ltd v. W Scott Fell & Co Ltd (1908) 5 CLR 647 at 650. 1. His Honour quoted at length (at [127]-[135]) from the decision of Brooking J in Toyota Motor Corp Australia Ltd v Ken Morgan Motors Pty Ltd [1994] 2 VR 106 (Toyota Motor Corporation); and relevantly stated at [131] from that decision: Some simple but essential guidance was offered by Bingham LJ in Food Corporation of India v. Antclizo Shipping Corporation (The Antclizo) [1987] 2 Lloyd's Rep 130, at 143: "Agreements are not to be imputed to parties who have made none .. If, therefore, the court is to find an agreement . . . it must on the balance of probabilities be satisfied that there really was such an agreement." That was said in a case where it was sought to infer agreement from silence and inactivity but the principle is no different when reliance for proof of agreement is placed on what has been said and done. … For instance, it was submitted that the court strains to give effect to commercial agreements. But as an examination of the cases shows, that may be so where once the court has concluded that the parties did enter into what was intended to be a binding and enforceable contract. In Hill End Gold Ltd v First Tiffany Resource Corporation [2011] NSWCA 276 at [61] Allsop P and Meagher JA considered that: … It is undoubted that contractual arrangements do not only arise out of formal offer and acceptance. In some circumstances, it will be open to a court apprised of the commercial context and the acts, including words, of the parties to interpret the engagements of the parties to ascertain the existence and extent of a legal relationship. A relationship and a body of conduct may evince a clear mutual intention to be legally bound in a particular respect or a relationship or a document may be "instinct with an obligation", imperfectly expressed: Moran v Standard Oil Co 211 NY 187 at 198 per Cardozo J (Court of Appeals, 1914). 1. At [136], Sackar J cites the decision Mushroom Composters Pty Ltd v IS & DE Robertson Pty Ltd [2015] NSWCA 1 as containing "the relevant principles concerning formation were summarised by Sackville AJA (with whom Macfarlan and Gleeson JJA agreed) at [59] - [63]": [59] First, in Australia the "objective" theory of contract has been accepted: see, most recently, Electricity Generation Corporation v Woodside Energy Ltd [2014] HCA 7; 251 CLR 640 at [35]. Consequently, in determining whether a binding contract has been concluded, the law is concerned not with the parties' subjective intentions, but with "the outward manifestations of these intentions": Taylor v Johnson [1983] HCA 5; 151 CLR 422 at 428 (Mason ACJ, Murphy and Deane JJ). Thus what matters is what each party by words and conduct would have led a reasonable person in the position of the other party to believe: Pacific Carriers Ltd v BNP Paribas [2004] HCA 35; 218 CLR 451 at [22] (per curiam); Toll (FGCT) Pty Limited v Alphapharm Pty Limited [2004] HCA 52; 219 CLR 165 at [40]-[41] (per curiam). In a case where the ordinary process of offer and acceptance has taken place, the court inquires as to what a reasonable person would infer or deduce from observing the exchanges between the parties: NC Seddon, RA Bigwood and MP Ellinghaus, Cheshire & Fifoot Law of Contract (10th Aust ed 2012, LexisNexis Butterworths) at [3.4]. [60] Secondly, it is not necessary, in determining whether a contract has been formed, to identify a precise offer or acceptance; nor is it necessary to identify a precise time at which an offer or acceptance can be identified: Ormwave Pty Limited v Smith [2007] NSWCA 210 at [68] and authorities cited at [68]-[75] (Beazley JA, Santow and Ipp JJA agreeing). The questions to be asked are: "in all the circumstances can an agreement be inferred? Has mutual assent been manifested? What would a reasonable person in the position of the [plaintiff] and a reasonable person in the position of the defendant think as to whether there was a concluded bargain?" Brambles Holdings Ltd v Bathurst City Council [2001] NSWCA 61; 53 NSWLR 153 at [81] (Heydon JA). 1. Sackar J notes at [138] that it is well established that the question of whether the parties intended to bind themselves to a contract is to be determined objectively, having regard to the intention disclosed by the language the parties have employed: Masters v Cameron [1954] HCA 79. 2. It is also noted by Sackar J that in determining whether the parties intended to conclude a contract, post-agreement conduct can be taken into account (at [139]). However, in the current matter it is in dispute between the parties that any agreement of any kind was made between the parties. Was there an agreement between the plaintiff/s and the defendant in relation to the service and/or the fee? 1. The evidence does not support that there was an agreement; more would be required. The plaintiff did not bring to the defendant's attention the terms – the attachment to the email does not suffice, the title to the attachment does not even state it is a fee agreement by Marsdens with Personnel Concept. There is no reference to a fee for service in the email. The email itself reads as a recruiter introducing one of the recruiter's clients for a job, and does not read as a recruiter seeking an agreement with an employer to act for the employer to fill a position. 2. Nor does the reference on page 2 of the two page letter (which is Attachment 2 to the email) state that an agreement binding on the defendant is attached; it doesn't refer to any agreement by the plaintiff and defendant to enter into a contract for recruitment services, it merely states that the fee structure is attached. Nowhere in the email is any offer to act for the defendant as recruiter set out, and in particular, nowhere in the email is any offer made to act as the defendant's recruitment service for a fee (let alone a contingency fee). 3. The plaintiff bears the onus of proof on the balance of probabilities. There is a significant conflict in the evidence, as set out above. I have no basis to prefer the evidence of the plaintiff over the defendant. As set out above, I prefer the evidence of Mr Butterfield, Mr Leith and Mr Johnson. Mr Leith's evidence is consistent with the Memo which he wrote proximate to the events. 4. The contingency fee structure is a substantial financial agreement for a respondent to agree to. It is implausible that Marsdens would agree to such an expensive recruitment agreement when the firm has its own HR department and had already publically advertised the position on the online recruitment website, seek.com. The defendant's account that they would not agree to engage a recruitment service which had made an unsolicited phone call, is plausible in this context. 5. I agree with the submission of the defendant's counsel that the plaintiff's manner of communication – by not discussing the contingency fee structure or specifically stating it in any covering email correspondence, and by not having a method for the recipient to communicate acceptance of the terms, has left itself open to what occurred in this case, namely, that the plaintiff proceeded to offer some assistance without there being in place any agreement to act for the employer, upon which the plaintiffs could base a claim to recover a fee. 6. The plaintiff relies for acceptance of its terms, on the receipt by the defendant of Mr Leith's CV as forwarded by the plaintiff/s. This simply does not constitute acceptance of the contingency fee structure set out in the fee agreement. Neither the offer to act as recruiter for the defendant, nor the terms of the fee agreement, were brought to the attention of the defendant. Attaching an attachment to an email without any reference to the attachment in the covering email (which reads merely as an introduction of a candidate) cannot possibly constitute a concluded agreement. There is no bringing to the attention of Marsdens the offer, or the fee which would be payable on acceptance of the offer. Nor is there any method for Marsdens to reject the terms even if they were brought to Marsdens attention (which they were not). There was no communication of acceptance of such terms by Marsdens, nor was there any ability for Marsdens to communicate acceptance given the way the offer was communicated by the plaintiffs. The sending of the email and attachments on 18 March 2016 cannot be considered to constitute a binding agreement between the parties, for the reasons given. No terms are brought to the attention of the defendants, nor is there is an opportunity for negotiation. No acceptance can be regarded as having been conveyed to the plaintiff by the defendant – there is no evidence of this occurring. Nor does the evidence support a conclusion of acceptance by conduct – Marsdens conduct is also consistent with Marsdens having accepted an introduction made on behalf of Mr Leith. The evidence does not indicate an acceptance by Marsdens of an agreement with the plaintiff to engage their services as recruiter, nor to pay the fee stipulated. 7. For all the above reasons I find that the plaintiff has not established their claim. Order 1. Verdict for the defendant. Magistrate Huntsman Downing Centre Local Court 21 June 2018 ********** NOTE: This judgement was upheld on appeal to the NSW Supreme Court. 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: 21 August 2019