Case name: Ford & Anor v La Forrest & Ors  QSC 261
A) Case introduction: The case deals with whether the parties in the contract are legally bound by the email that they have exchanged and whether there existed a contract that bound them. The case deals with unequivocal acceptance of contract and also compromise and settlement which the court tried to understand by the offer of settlement that was in place between the parties.
B) Facts of the case: Adele Morrow sued the applicants in the present case sued the applicants Conrad International Hotel and also along with the hotel, John Ford, Detectives Sergeant, the State of Queenland and also the District court for the personal injuries that Adele has sustained. The suit was unsuccessful and as a result Adele filed a Notice of Appeal in the Court of Appeal. In the dismissal of the suit, the Judge Forde have a detailed and long explanation as to why the suit was dismissed (Jiang et al 2016). The matters in concern were many and it also included the contents of the appeal book. While the matter was going on the solicitors for the Hotel wrote a notice to Adele asking her to settle the matter. The letter of the solicitor aimed at solving the dispute because both the parties were bearing insurmountable income and the expenses were recurring without any benefit to the parties. Therefore to avoid any further expenses, the solicitors asked Adele to end the dispute so that there is no further expense borne by the parties. Therefore, to end the expenses, the solicitors made an offer to amicably settle the matter and the offer was commercial in nature whereby the parties were ready to settle the same without admitting any liability. Speaking for the hotel and the first and second respondents, the solicitor claimed that they shall be bearing their own expenses and also pay for the cost of the action, inclusive of the costs of the trial that has been incurred to the present date. The condition for bearing the costs by the respondent was that the appeal shall be discontinued and that Adele will not continue with her suit and will also sign a Discharge to the effect. The solicitor gave a precondition that if Adele does not sign the discharge to that effect, the parties shall continue with the suit and shall also not make any further offer of settlement.
Adele was given only a time span of 7 days and if within that time of 7 days Adele does not accept the offer of settlement and reject the offer, The Conrad Hotel and the first and second shall continue with the defense and also vigorously fight it in the court. The respondents will recover all the costs that is due from Adele and also the costs of the trial that is going on. A similar offer of settlement was received from the solicitors who are working for the State Government. The offer of settlement was of similar nature which stated that the State of Queensland, Detective Sergeants are prepared to settle amicably on the condition that each party shall walk with their own costs. Therefore, by implication, the offer of settlement meant that Adele shall discontinue the Appeal with respect to the ongoing matter and shall also bear the costs of the first Instance along with the costs of the Appeal. The costs shall be borne up to date. All the parties involved in the suits shall discontinue and they shall bear their own costs in respect to matter of both the first instance and the appeal. The offer also had a deadline, that is, the offer would have expired after 4 pm on the 2ndof March 2001. The offer was clear from ambiguities and had clearly mentioned the terms of the settlement (Arthur 2018).
After receiving the offer, Adele sent a counter offer by letter stating that she is willing to settle the matter after a payment of $50,000 is advanced and that shall be the final amount of the settlement. The letter by Adele was sent on 26th February and on the 27th February, Ms Morrow sent another letter stating that the offer was a once only offer which was subsequently rejected by Solicitor Crown. On 1st March the offer of settlement by the parties was already in the open and the parties were aware of the existing contract. Referring to the offers made on 22nd February and 26th February, Adele communicated with both Quinlan Miller and Treston and also with the solicitors of the Crown. Therefore, Adele responded by email to the offers of settlement saying that she is aware of the offer made regarding discontinuing the trial and the parties incurring their costs till date of the ongoing costs and the e-mail also said that Adele is prepared to make an amicable settlement and shall be waiting for the receipt of the discharge to that effect. Adele also sent a reply to the Crwon solicitor by facsimile and said that with reference to the offer os settlement dated 26th February, Adele is ready to accept the terms of the offer and also holds that each party shall be bearing the costs of the trial in relation to both the case of first instance and also the trial. That Adele is ready to accept the offer and be bound by the terms of the same and shall bear the costs of the trial. Also as per the terms of the offer of settlement, Adele is ready to discontinue with the Appeal and thereafter bear the costs of the Appeal that has been incurred to this day.
Thereafter the Crown Solicitor sent a receipt of acknowledgment of the offer of settlement and also sent a Deed of Discharge to that effect for the execution. A similar acknowledgment was sent by Quinlan Miller and Treston confirming that they have received Adele’s e-mail and also mentioned that the offer of the client has been received the acknowledgment was sent on 1st March by e-mail. The terms of the deed were not unique to each other but they were of similar kind and their terms were on the same line but they had different effects. Ms Crown made a submission that she could not accept the deeds forwarded by the respondents because she had rejected the contention that a compromise was arrived at and therefore refused to give a notice of agreement to dismiss that appeal. The rejection of the offer of settlement had the effect of informing the Court of Appeal regarding the settlement of the matter.
C) Issue raised:
1.Ms Murrows raised the argument that there was no contract between the parties and emails do not create binding contractual relations.
2.The respondents claimed that the terms of the contract were evident that there was a contractual relation between the parties and that emails constitute legal and binding contractual relations.
D) Arguments presented:
The respondents to the appeal claimed that the appeal filed by Morrow be forever stayed as the applicants in this matter stated that the appeal in the Court of Appeal has been compromised. The respondents claimed that there was a binding agreement. They also claimed that the application submitted by Ms Murrow in the written submission was incongruous and irrelevant to the actual application. Therefore, the submissions made by Murrow were irrelevant and cannot be given careful consideration.
Ms Murrow in her statements has made the declaration that there was no compromise and she has made various arguments in that regard. That is, Ms Murrows claimed that in respect to the offer of settlement by the Crown Solicitor and Quinlam Miller & Treston, there was no binding effect of the contract that was entered into between the parties. Therefore, the terms of the agreement did not have a binding effect and cannot be construed as having the same. Ms morrow also claimed that the solicitors had exercise undue influence and has coerced her to enter into the agreement. The conduct of the parties were oppressive and also had intimidated the parties to enter into the contract and that Ms Murrows could prove by evidence that there was foul play in the conduct of the parties and they had exercised duress. Murrows claims in her submissions that e-mails do not have the power to create binding contracts and the terms of the contract were unsatisfactory. Emails do not create contractual relations and also the words used in the email do not constitute an unequivocal contract.
E) Judgment of the court:
Lucas J held that there was no contract created between the parties by the correspondence. The question that the judge had to address was whether there was a relation between the two parties and whether the correspondence had the power to create legal obligations (McKendrick 2014). The judge therefore held that understanding the terms of the contract, it is evident that that the terms of the contract are not consistent with the fact that a contract can be established by sending the letter (Kotz 2017)
F) Case Analysis
The court relied on the judgments of Giblin v Duggan where it was held that the insurer had written the letter while responding to the proceedings of threat shall not be treated as a contract. The expression “prepared to accept” is an indication that the party is willing to accept contractual terms but it does not denote finality and therefore lacks short of an intention to create a final and binding contract (Cartwright 2016). Therefore the statement made by the insurer that they are ready to claim liability and compensate the client in cases of any harm he suffers does not imply a final consideration and cannot be treated as a contract in legal parlance. Therefore even though the parties said that they were ready to accept liability cannot be given the colour of finality and did not mean that the parties were ready to accept liability by virtue of the contract.
1) In this case, the ruled against Ms Mollows by upholding the principles of Giblin v Duggan, where the exclamation “prepared to accept”did not infer any finality and did not state that the parties were fully prepared to take liability of the situation (Poole 2016). The respondents in the case held that correspondence by email can be held to be binding and also it created a legal relation between the parties. The court held that there has been a compromise and therefore the appeal should be stayed. Though Ms Murrow held that there was no compromise, the court ruled against it. The court was of the opinion that there is a general rule guiding the enforcement of contracts and settlement agreements once the agreements have been entered into.The argument put forward by Ms Murrow that she had no unequivocally accepted the terms of the contract was not approved by the Court and the Court was of the opinion that the appellant, that is Ms Murrow had accepted the offer to compromise the action and hence was bound by it.
2) Ms Murrow referred to the case of Masters v Cameronwhere the court had recognized three types of cases where a binding contract can be reached. In this case the court had applied the third case of obligation arose which was fundamentally different from the other two cases in which the agreement did not have any intention to create legal and binding relations (Knapp, Crystal and Prince 2016). The Appeal that was preferred by Murrow did not fall into the third category, on the other hand, it fell in the 2ndcategory, that is, there was a binding and legal agreement between the parties. In the 2nd case, the parties had agreed to all the terms of the agreement and had decided to be bound by the bargain that was reached between them. Therefore, the Appeal Court held that there was a legal and binding agreement between the parties which was contingent on the execution of the discharge (Barker, Fairweather and Grantham 2017). Therefore, the Court held that the parties were bound by the terms of the agreement and there was a contract in place. Therefore, it was held that there was a compromise between the parties and that Ms Murrow has bound herself by the terms of the contract (Adriansee 2016). She was obligated by the terms of the contract to stop the appeal from further continuing and make an enforcement by signature in favour of the discharge of parties.
Archive.sclqld.org.au (2018) Archive.sclqld.org.au https://archive.sclqld.org.au/qjudgment/2001/QSC01-261.
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