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Contract, settlement

Bowcliff PL v QBE Insurance (Aust) Ltd. [2011] NSWCA 18 21.02.11. per Handley AJA.

[35] Statute apart, a consent judgment only affects the parties who consent: Spencer Bower & Handley "Res Judicata" 4 th ed 2009 para 2.19.

Checchia v Insurance Australia Ltd t/as NRMA Insurance (No 2) [2010] NSWSC 112. Rothman J.

In this ancillary disposition to interest, costs and appeal stay, Rothman J said, infra [15]: “A contract, including the Settlement Agreement, may be rescinded for fraud and other matters affecting its formation, in which case the parties are restored to their pre-contract positions: Commissioner of Taxation v Reliance Carpet Co PL [2008] HCA 22; (2008) 236 CLR 342 at [2]…

"As the High Court there made clear, such a rescission is distinct from a rescission (hereinafter … “termination”) at the election of one party, or indeed arising from frustration: see also Photo Production v Securicor Transport Ltd [1980] AC 827 at 844; and Johnson v Agnew [1980] AC 367.”

Then, “Absent agreement of the parties, and absent frustration, a party may terminate the contract, under the common law, for a breach of a condition (or essential term), or for a sufficiently serious breach of an intermediate term:Koompahtoo Local Aboriginal Land Council v Sanpine PL[2007] HCA 61; (2007) 233 CLR 115; Hong Kong Fir Shipping Co Ltd v Kawasaki Kisen Kaisha Ltd [1962] 2 QB 26.” [18]

And, “Once there has been breach of an essential term (or a sufficiently serious breach of an intermediate term), the party not in breach (the obligee) may elect to terminate the contract and sue for damages arising from the breach: McDonald v Dennys Lascelles Ltd [1933] HCA 25; (1933) 48 CLR 457, at 476-477, per Dixon J.” [21]

“The alternative course to termination is to elect to keep the contract on foot and sue for the breach, without terminating."

"It is this course for which Mr Checchia has elected. More accurately, Mr Checchia has declined to elect to terminate the contract and, with the contract in existence, has sued for damages for breach of the contract. Those damages were the subject of the principal proceedings.”

Damages for settlement breach 42 WCMS 1

Seaib v Hays Personnel Services (Aust) PL [QBE] [2008] NSWWCCPD 36. Snell ADP. 26.03.08 [12.11.07].

[This judgment appears at 1.1.11 to have been removed from the austlii list: hence no link]

After considering authorities, the acting deputy president said [77]: “Without purporting to be exhaustive, I would identify the following principles from the authorities discussed above,in respect of the legal consequences of prior settlements effected by consent award:

• A consent award can create res judicata estoppels,and also will involve admissions of facts inherent to the award, for example the occurrence of injury, or the existence of economic incapacity resulting from injury, at a certain point in time: Rail Services Australiav Dimovski & Anor [2004] NSWCA 267;

• When an issue is the subject of res judicata estoppel, it is not justiciable in a further action;it is not open to consideration de novo: Almario v Carrington Constructions PL (1996) NSWCC 37, 13 NSWCCR 739;

• A res judicata estoppel, created by a consent award for an employer, on a weekly claim, orclaim for section 60 expenses, operates up to the date it is made. It does not eliminate future rights: Almario; Kaibau v Gillespie’sProduce and Packing PL [2006]NSWWCCPD 168, WE Bromley PL v Coggins [2006] NSWWCCPD 128;

• A consent award does not oblige the Commission, in subsequent proceedings, to take the factual position described in the consent award as a starting point in the fact finding process. The Commission should determine the facts as at the date of further hearing,“without legal constraints flowing from theearlier award”: Dimovski, De Witte v Tawnay PL t/as Country Coast Real Estate [2006] NSWWCCPD 109, Kaibau;

;• When engaging in this fresh fact finding process, it is appropriate to have regard to admissions flowing from the earlier consent award, and the presumption of continuance.However such matters are only part of the evidence, to be considered with other evidence, lay and medical: Dimovski, Coggins;

• A consent award does not create an issue estoppel: Anderson v Charles Sturt University (2002) NSWCC 63, 25 NSWCCR 407;

• Where a worker executes admissions and agreed facts as part of a settlement, these speak as at the time they were made. They are evidentiary of the facts stated, but not conclusive: Almario;

• It is necessary to analyse and interpret admissions and agreed facts with care, in deciding what evidentiary force they have: Smylie v Uniting Church [2006] NSWWCCPD 322;

• S 60 is an indemnity provision: NSW Sugar Milling Co-op Ltd v Manning (1998) 44 NSWLR 442. Admissions that a worker has no entitlement to such expenses “thereafter”,or “over and above” an agreed sum, should be read in this light: Smylie;

• Agreed facts which purport to impose a blanket bar upon the recovery of further compensation..., must be read subject to s 234 of the 1998 Act, which prevents contracting out of the 1987 and 1998 Acts;

• The parties cannot use a series of consent awards to achieve de facto commutation, without appropriate approvals: Nelson v Flood & Co Ltd [1934] 8 WCR 227, Almario.

It was erroneous for the arbitrator to require the worker to prove deterioration subsequent to the settlement. All claim circumstances should have been considered.

Further, Worker hurdles agreed facts 25 WCMS 2.

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