iscover
While representing a client who claimed he was unfairly fired, a senior solicitor was at risk of a finding he allegedly exceeded his authority by working on a settlement offer without instructions.
In Federal Court proceedings, Claude Mpinda alleged his solicitor was liable for negligence by working on and making a settlement offer with his former employer, Western Areas Limited, to conclude a Fair Work matter without authority or instructions.
However, Justice Michael Feutrill found there was never a binding and enforceable agreement between Mpinda and Western Areas, so the solicitor could not be held liable for the alleged settlement work.
Western Areas claimed that seven days after a conciliation conference in early December 2016, the lawyers for both sides made and agreed to a settlement of $2,000 and a written reference.
The solicitor told the Federal Court he had “express authority and instructions” from Mpinda to make a settlement agreement, and he claimed this was given to him the day before the agreement.
However, Mpinda denied any such conversation ever happening.
In submissions, Mpinda alleged: “Even in a dream, he never told me he will go to settle my matter, or in fact I didn’t even know what was going to happen, how things goes [sic] on in a conciliation.”
Justice Feutrill said it was evident Mpinda did not understand what would happen if the offer was accepted, and records from the solicitor suggested he “did not indicate” that the offer could result in a binding agreement that would bring an end to the Fair Work matters.
In part because of the delay since the events transpired, the Federal Court did not have evidence of the solicitor ensuring Mpinda understood the advice and explanations so as to “sufficiently” allow the client to make fully informed instructions.
There was also no evidence the solicitor took any steps to ensure his language was understood by Mpinda, who had a “fair command of written English, but spoken English was a different matter”.
Justice Feutrill went on to say it was consistent in the solicitor’s characterisation of the agreement with Western Areas’ lawyer being “in principle” that his instructions from Mpinda were limited.
“I find that [the solicitor] was not authorised to put an offer to Western Areas that if accepted would form a binding settlement agreement through the agency of [the solicitor],” Justice Feutrill said.
The court found the solicitor’s authority was limited to obtaining an agreement “in principle” to a settlement that would involve Western Areas providing the $2,000, and any binding agreement was to be made in a written document that could be reviewed and signed.
“It follows that if and to the extent that [the solicitor] conveyed to Wilmot an offer to make a settlement agreement that if accepted would result in an immediately binding agreement between Western Areas and Mpinda, [the solicitor] exceeded his authority as Mpinda’s agent,” Justice Feutrill said in his written reasons for judgment.
However, looking at the communications between the two lawyers further, Justice Feutrill said a “reasonable business persons” would not understand there was a final and binding contract on behalf of both parties to settle the unfair dismissal proceedings.
