3/9 IN THE FEDERAL COURT OF AUSTRALIA INDUSTRIAL DIVISION ) N.S.W. No. 21 of 1978 ) ) NEW SOUTH WALES DISTRICT REGISTRY IN THE MATTER of the Conciliation and Arbitration Act, 1904 AND IN TIE MATTER Of an zppi'catron under Section 140 of the said Act BETWEEN MICHADL GERARD DOL ND and PATRICK OWEN REG VIS Claimants AND FEDERATED LIQUOR AND LLLTAD INDUSTRINS UNPL oved Vy Ts OF AUSPRALTA -<) wsata fis Respondent JUDGE MAKING ORDER: J.B. Sweeney J. DATE OF ORDER: 3 April, 1979 WHERE MADE: Sydney THE COURT ORDERS THAT: This matter be adjourned generally with laberiy to e.ther party to apply on 48 hours notice. y ' WN THF FESCRAL COURT OF AUSTRALIA INDUSTRIAI, DIVISION ) V. No. 36 of 1978 ) ) HLW SOUTH W?.LES DUSTRICT REGISTRY IN THN MATTEP of the Conciliation and Arbitration Act, 1904 AND JN THR MATTER of an applicaiion under Sections 140 and 141 of the said Act BETWEEN NICHAGT, RAED POLAND, PATTY TCR REEVES and Kovod iTELNS Claimants AND J. MUN?PO, J. GODDAP od. MURPM, P&P Sat W,_ LIVINGSC: i T. CROTHF?S, &. - KK. Si0CKS, Le. ik J. MORDTS, Ke. TF P. FVANS, G. ° and POOF ATED INDUS' PLES miiDLO - AUSTRALIA Respondacnts JUDGE MAKING ORDFR: J.B. Sweeney J. DATE OF ORDER: 3 April, 1979 WHERE MADI: Sydney THE COURT ORDU?S THAT: Order nisi discharged BO ee ee ee ree ee eee IN THE FRDFRAL COURT OF AUSTRALIA INDUSTRIAL DIVISION NEW _ SOUTH WALES DISTRICT REGISTRY IN THE MATTER of the Conciliation and Arbitration Act, 1904 AND _(N THE MATTER of an application under Section 140 of the said Act BETWEEN MICEAEL GERARD ROLAITD ana PATRICK OWEN RELVES Claimants AND FEDERATED LIQUOR ANID ALLIND INDUSTRIFS EMPLOYEES UY OF AUSTRALIA Respondent (N.S.W. No. 21 of 1978) AND IN THE MATTER of an application under Sections 140 and 1+1 of the said Ac BETWEEN MICHAML GERARD BOLAND, PATRICT: REEVES ana KEVIN MULT aR Claimants AND J. MUNRO, J. GONDAPD, FP. SAME J. MURPHU, T. ARMSTRO? Ww. LIVINGSTO: T, CROTHErS, G. K. STOCKS, F. F J. MORRIS, Ke P. EVANS, C. | INDUS TRI ES _LMBE AUSTRALIA Respondents (V. No. 36 of 1978) J.B. SWECONLY J. 3 APRIL, 1979 RMASONS TOR _CUDSMENT These are applicaticns by members, the Generai Secretary and the Assistant General Secretary, of the Federated Liquor and Allied Industries [Employees Union of Australia ("the Union"). They are brought under the Conciliation & Arbitration Act, 1904 ("the Act"). In the first, N.S.W. 21 of 1978, an order is sought that rule 11(g) in the form in which it appeared at the time of the making of the Order Nis1 should be disallowed as being in disconformity with s.140 of the Act. Tn the second matter, V. 36 of 1978, orders are sought under s.141 that the respondents, members of the Federal Council of the Union, should perform and observe the rules of the Union by treating as null and void and of no effect purported resolutions of the Federal Council in November, 1978 amending rule 1l(g) and rule 16. A second order sought was that the respondents should perform and observe the rules of the organization by acting bona fide in consid- ering proposed amendments to the rules. The claim for this second order was however abandoned. In addition in these second proceedings an order was sought against the Union that rule 1J](g) and ruie 16(10) be disal~ lowed as contravening s.140(1) of the Act. A further order was sought declaring that the rules of the Union generally contravene or alternatively that rule 13(a) in particular contravenes s.140(1) by failing to provide for the control of the Federal Council and the Federal Management Committee of the Union by the members. It 18 necessary to set out the brief hastory of the matters. For some time the registered office of the Union was in Melbourne. Different persons were elected to that office from time to time and,if not already resident in Victori2, they then moved to and took up residence in Victoria. [In 1967 a Mr. McVeigh became the General Secretary and he, prior to his election, had said he would accept that post only if the registered office and headquarters of th2= Union were transferred to Canberra. This was done and 1t rem- ained the position until 1978. During that time there were changes in the holders of the office. In 1977 the Federal Council decided that at some time prior to 30 June, 1973 the federal office and headquarters should be in Melbourne. In April, 1978 the applicant Boland was elected to the position of General Secretary and the applicant Reeves was elected to the office of Assistant General Secretary. The election was declared on 18 April, 1978. At this time the rule provided that the federal office should be transferred to Melbourne on or before 30 June, 1978 and this appears to have been done about April of 1978. Some time thercafter the proceedings referred to as N.S.W. 21 of 1978 were com- menced. These were by consent adjourned to allow rvle ll(g) to be considered at a mecting of the rederal Courcil arranged for November of 1978. At that meeting of the Federal Council, rule 11(g) in the form attacked in No. 21 of 1978 was deleted and by the same resolution a new form of rule 11(qg) was adopted as was a new form of rule 16(10). It seems that the convenient course for me to auopt 1s to consider first the application under s.141. If I reach the view that the amendments to rule li(g) and 16(10) were validly adopted there is no point in considering rule 1i(g) in its old form. If I reach that view IT shall then proceed with the question whether they and then rule 13A and the rules generally are open to attack under s.140. It should be added that the rules have not yet been certified but have been lodged for certification. Validity of Alteration to Rules The power to alter rules is given to the Federal Ccuncil in rule 8 and the machinery for making new rules and altering existing rules 1s set out in rule 39, This provides in paragraphs 1, 2 and 3 as follows: "1. Wo new rules shall be inaGe, nor shall any cf the rules for the time being of the Union he altered amended or rescinded, except by and at a meeting of Council. 2. Any proposed new rule or alteration, amendment er rescinding shali be endorsed by a Branch Meeting and the Secretary of such Brauch shail notify the General Secretary in writing at least six weeks before a Council Meeting of the proposed alteration. The General Secretary shall forward the proposed alteration to each Branch at least one month prior to the meeting of Council at which the proposed new rule or rules or alterations, amendments cr rescinding of rules are to be discussed. The Branch Secretary shall submit such proposed alteration to a Branch Meécting prior to the Council Meeting." Paragraph 4 deals with a method of altering the constitution rule, rule 4, not relevant here. A number ¢ * grounds which had been taken when the rule nisi was made were abandoned and ultimately the attack was con- fined to the fact that the amended rule as finally adopted aiffered in some respects from that which had been endcrsed by a branch meeting and then forwarded by the General Secretary to each branch and submitted to the branch meeting. The resolution carried by the Federal Council was in the following terms: "Rule il - sub-rule (gq) - Delete Sub-rule (g) INSERT in its place the following:- "(g) (g) (4) (ii) The General Secretary and the Assistant Secretary shell be elccted as hereinafter provided and to terminate either office by them four full weeks notice shall be given; but if such office is terminated in accordance with Rule 14, 14a or by an election held as provided by these rules then such notice shall not be required. Any menber shall be eligible for election as General Secretery or the Assistant General Secretary provided he shall be a fanancial murber of the Union for two years immediately prior to nomanation. (g) (i321) The place of employment of the General Secretary and the Assistant General Secretary shall be at the Ueadquarters of the Union. If they are not residents of the state in which the headquarcers are located they shall hecome residents thereof, and the reasonable cost of transfer shall be paid the amount thereof being determined by Federal Councal or Federal Committce of Manayoment. (g) (av) When the official duties of the General Secretary or the Assistant General Secretary necessitate either being absent from the Headquarters of the Union such travelling and/or other expenses as determined from time to tim by 7 Foal shall b wedi aw 1 perett came sy Councis Gaa OS peia. This resolution @aiffers from that which had been endorsed and circulated in two respects, first by the insertion of the words "by them" in paragraph (1) and secondly by the deletion from rule 11(g)(i1i) of the words "and they shall be residents of the State in which the Headquarters of the Union 1s located from time to time as decided pursuant to sub-rule (a) of rule 5" and by the insertion of the words "If they are not residents of the state in which the head- quarters are located they shall become residents thereof and the reasorable cost of transfer shall be paid the amount thereof being determined by Federal Council or Federal Committce of Manageaent. " An examination of the rules showed that the only method in which the holding of the office of General Secretary or Assistant Secrelary could be terminaled by the Union was an accordance with rule 144 or by an election. The rules provided that nolLice was nol. required in either of these events In these circurstances the first part of the rule could have had no application to a termination other than one by the holccr of the office. The insertion of the words "by them" does not effect any change in the meaning or effect of the rule. It simply makes clearer the position which already existed. So far as the second change is concerned, the rule endorsed by the Victorian Branch and subsequently circulated and sub- mitted provided, as does the rule adopted, that the place of employment of the General Secretary and the Assistant General Secretary shail be at the Headquarters of the Unton. It then went on to say "and they shall be residents of the State in which the Iieadquarters of the Union 1s Jocated from time to time as decided pursuant to sub-rule (a) of rule 5". Instead of imposing this direct obligation the adopted rule approached the problem by providing in terms that if the two persons concerned "were not residents of the State 1n which the Headquarters are located they shall become residcnts thereof". This part seems to me to efiect no change at all other than to make clearer that persons may be elected to the office who are not residents of the relevant State and that they come under a duty to become residents after election. Tn my view on 1ts proper inter-- pretation this 1s the meaning of the rule as submitted for endorsement: Kane v. A.B.C. Staff Association, 11 August, 1978 (unreported). The additional words added at the Council meeting then go on to provide for the payment of the reasonable cost of transfer and that the amount thereof should be deter- mined by Federal Council or Federal Commitiec of Management. The Federal Council already had power to fix the wage rates and conditions of employment of these two officers (Rule 11(£)(iii)). The Tederal Committee of Management had general control and conduct of the affairs of the Union while the council is not sitting. Acting under either of these powers the bodies concerned could, in my view, have properly made provision for the payment of the reasonable costs of transfex. I regard the provision now made for payment of the cost of transfer as clearly within the scope of the amendment endorsed by the Victorian Branch and circulated to the branches and clearly germane to the matter being dealt with, namely an obligation on the part of two officers to reside in the same State as the Veadquarters are situated. The question argued is then whether by virtue of rule 29 the Federal Council could consider a proposal endorsed by a branch and coming before at but could not consider any amendment to such proposal at all, It is to be noted that rule 39 provides a method whereby proposals for rule changes are to come before the Federal Council meeting. It is obvious that the rule change is to be dealt with at a Council meeting. Rule 25 provides a set of rules of debate at Council meetings with provisions about the moving and seconding of resolutions, the order of debate, the length of speeches and the like. Prevision is also made limiting the manner in which matters decided may come again before the Council meeting. I think it quite clear that the rules corterpliate and show the intention of the Union that the rules of debate should apply at Council meetings dealing with amendments to rules as well as when dealing with any other matters. Rule 5, an addition to the matters I have referred to, also pro- vides "any number of amendments may be proposed and dis-— cussed simultaneously with original motion (sic}". This of course appears to be a statement of the yenoral law on the matter. In his textbook on Meetings, Sir Percy Joske has said: "A motion of which notice has been given ney be amended, although no notice of the proposed amendient was given pricr to the meeting, provided the amendment is within the scope of the original motion and does not alter ics nature. Additions to and alterations of the original motion are ajJlowcd, so long as the nature of the motion 1s ot affected, quite irrespective of whether or not notice of amendment was given hefore the meeting." In the case of corporetions, Halsbury, 4th edition, volume 9 in dealing with corporations says: "1305. Amendment of resolution. A particular res-— olution or question being before a corporate meeting, it 1s open to any corporator attend- ing that meeting to move an amendment thercto, provided it 1s legitimate and germane to the matter for which the meeting was called: and the chairman or presiding officer is bound to accept and put the amendment before the meet-— ing for decision, This rule does net apply where the question before the meeting is simply the confirmation or rejection of some act which has been done but requires confiryma- tion or rejection." while Halsbary, 4th edition, Volume 7 dealing with companies says: "589. Amen@rents to resoluticns. Any arendment fairly arising on a resolution which 1s specificd in the notice of meeting and within the scope of the notice may ke proposed and passed at the meeting, and a chairwen has no right to refuse to put such an amendment. It is usual fer a resolution or an amendcd resolution to be moved by one voter and sec- onded by another, but if the chairman chooses he can put it to the vote without these formalities." The same view has been taken of the rule-making powers of voluntary associatzons: Daley v. Gallagher (1925) Q.S.R.1. I think no significance attaches to the use of the terms "the proposed alteration" in rule 39(2) and (1i) and the term "proposals to alter etc. rules" in paragraph (iv). 10. It was argued for the applicants that minor questions of punctuation could be corrected but if the rule requires the proposal as endorsed by a branch and nothing else to be considered, it is difficult to see why matters of punctuat.on may be exceptions. The purpose of the rule is to ensure that members may have knowledge of what is proposed to be discussed at a Council meeting. On the advice then received they may or may not direct their delegates how to vote and would of course be entitled to direct them to vote for the proposal and against any amendment or in such other manner as the members thought fit to give their direction. I see no reason why rule 39 prevents the Council from considering in the same manner as other rule-making bodies not only the actual proposal but matters clearly within its scope and germane to it. For these reasons I am satisfied that the new rules 11(q) and 16(10) were properly adopted. The first order sought was based on the view that the rules were not validly adopted and is so refused. Rule 11(q) In matter N.S.W. 21 of 1978 an order is sought for a declaration that rule 11(g) 1s in disconformity with s.140 of the Act. As has been pointed out the old rule llfvu) was repealed and a new rule adopted by the Federal Council of the Unicon. These amendments have li. been lodyed wath the Registrar for certification, but not yet certified. In its old form rule li(g) provided: "He {that is, the General Secretury or Assistant General Secrctary) shall reside where directed by the Council". Since the Union covers the whole of the Commonwealth with interests in each State, the Federal Council acting in the best interests of the Union could well form an opinion that 14 was necessary for one or the other to be stationed at different places during his term of office according to the needs of the Union at different times. There might, for example, be a particular membership drive, a demarca- tion dispute or the like with another large union or a particular industrial dispute which required the presence of one or the other for such a time as would make residence desirable. Moreover, the Council could, again acting in the best interests of the Union, reach a decision that it was in the interests of the Union that the officer should reside in different places at different parts of his term ef cfitice. I am saiisfied that a rule in such a form would offend against s.140 and particularly s.140(1)(c) by amposing upon the officers conditions which having regard to the objects of the Act and che purposos of registration were oppressive, unreasonable and unjust. 12. However the rule has now beer deleted and this awaits only the certification by the Registrar. In the circum- stances, I think I should make no order but adjourn the matter generally. It may be restored to the list when the decision as to certification by the Registrar has been made. Turning then to v.36 of 1978, this seeks in addition to orders for the performance and cbservance of the rules, declarations as to the new rule 11(g) and rule 16 anda further declaration as to the deficiency of the rules generally. Turning to the latter aspects, the position is again that the rules have not been certified. From the terms of 8.140 I have very considorable doubt whether an order may be made under that section dealing with the rules which have not been certified. It 1s clear from s.139(4) of the Act that the alteration of the rules does not have effect until the Registrar has certified that the altera- tion complics with and 1s not contrary to the Act or the regulations and has been madc in accordance with the relevant procedures laid down by the rules. I should have thought that a rule which does not have effect can- not be said, for example, to prevent or hinder members ef the organization from observing the taw. Nor could it be said to impose any condition, obligation or res- triciion upon members. Equally I thank until it has 13. effect 1t cannot come within the provisions of s.140(1)(a) or (da). However there is what is at least obiter of the Australian Industrial Court to the contrary in Allcn v. Lacagy 7 A.L.R. 261. The Court was dealing with applications which appear to have been made under s.141 seeking ordexs in resrect of rules which had not yet been certified. The Court then said; "Apart from the cperation of s.171c the claimants are entitled to an order under s.141 directing the respondents to treat the resolution (to amend the rules) as void and of no effect" The court then proceeded to deal with the issues raised in an application made pursuant to s.17lc. It 1s true that this was not a decision of this Court but of its predeces- sor, but in the circumstances and particularly since I must deal with other parts of the application V. 3¢o0f 1978, 1t seems to me preferable that I should deal with this aspect as well, although I express arave doubts as to my jJuerisdiction so to do. I have also had in mind the provisions of s.22 of the Act. I have already set out the provisions of rule ll(g) and rule 16 in the>r amended form. Stated shortiy, they ampose an obligation on a successful candidate for the office of Genetal Secretary or Assistant Ceneral Secretary 14. to reside at the place where the head office of the Union 1s situate and provide for the payment of the costs of removal. It 1s of course a common feature that a person seeking office, either parliamentary or in the course of a career in the public service or in private industry or in unions to find that to fulfil the requirements of the office he may be obliged to change his place of residence. In the case of this union 1t is clear that on past occa- sions persons elected to the post of Federal Secretary have on election transferred their residence to the place where the head office of the Union was situated and that has varied from time to time between Melbourne and Canberra. At the time the two officers contested the election the head office of the Union was in Melbourne and the require- ment of the then rule 11(g) was known to them. They also knew that the Pederal Council had declined shortly before to transfer the head office to Svdney. The imposition of an obligation then, which, 1n practical terms, requires the two officers to reside in the State in which the Headquarters are located, namcly Melbourne, 1s not an obligation or condition cr restriction wnich can be said to be unreasonable, unjust or oppressive. It was put to me that within the terms of the rule the officer could, for example, reside at Wodonga if he wished. That is true in theory but opposed to all the practical ard economic realities and if an officer chose such a method of compliance with the rule I don't thin, he can be heard to complain about it. 15. Federal rule 16 previously provided that the Secretary should be paid when his duties necessitated absence from home such travelling and/or other expenses es may be determined from time to time by Council. 'This has been deleted and a provision inserted 1n the following terms: "When the official duties of the General Secretary or the Assistant General Secretary necessitate either being absent from the Headquarters of the Union such travelling and/or other exvenses as determined from time to time by Ccuncii shall be paid" The substantial change is the omaseion of the word "home" and the insertion of the words "the Meadquarters of the Union". In the light of the views I have expressed about the amendment to 11(g) I see nothing which could be com- plained about in the new rule 16. The normal test in any employment for the payment of expenses of this nature is absence from the place of emplcymert, not from home and the new rule does nothing Pit set this out. I am therefore of the view that reither rule 1l1(g) nor rule 16 in the new form are open to attack under s.140. This brings me to the remaining question - whether the rules and in parlicular rule 13A are contrary to \ Regulation 115(1)(d) made undaz the Act. Tt 1¢ necessary to examine shortly the system of organization adopted within the Union. Members are 16. organized in branches, there being one in each State. The branches and their numbers as at 30 June, 1978 were as follows: New South Wales 41,666 victoria 14,862 South Australia 11,246 Queensiand 9,421 Western Australia 6,308 Tasmania 3,653 87,156 Provision is made for ordinary meetings to be held by each branch at least once every three months. At these meetincs ten form a quorum. In addition special meetings may be called in various ways including by requisition of financial members. In the case of a branch with more than 2,000 members, 100 must requisition the special meeting. In the case of branches with less than 2,000 members, 25 must requisition the meeting. In each case the quorum is 25. In addition to these meetings there 218 provision for section meetings in rule 264A and these must be called on requisition by 25% of the membership of the section or 100 members of the sect_on. 'There 15s, then, ample opportunity for menbers to participate at meetings at branch level and to raise any 1ssuecs ina forum of the Union. 17. The branch is then, subject to the federal bodies, managed by a branch committee of management. This consists of 16 members all of whom are elected by the members of the Union, some for three years and some for four. 'The branch commit- tee of managerent 1s bound by a resolution of a branch meeting at which at least 1% of the members were present. There 1s also provision for delegates and shop stewards. Turning to the federal structure, this pruvides for man- agement and control by committees. With the Union, whose membership 18 spread over the Commonwealth, it is obviously ampossible to have management or control by meetings of members. It 1s a form of government in which the sovereiqn power resides in the members and 1s exercised by their elected representatives. The very fact of periodic elec- tion by the members ensures some control in them. The body having overall control in the organization is the Federal Council. 1t consisis of the General Secrerary and Assistant General Secretary who are electcd by rank and file members of the organization at secret postal ballots every four years. Jn addition there are branch representatives on a sliding scale eccording to the membership of a particular branch. At the present time the branches are entitled to representation as shown hereunder: New South tales Sir (6) Victui ta Jhree (3) Sovth Anstrai1a Three (3) Ouceneland Three (3) Western Australia Two (2) Tasmania Two (2) 18. These branch delegates are elected by the rank and file menbers of each branch by secret postal ballot triennielly. Federal Council meets once each year at such time as 1s decided by itself or the Federal Committee of Management. In addition 1t holds special meetings when decided by the Council or the Committee of Management or the General Secretary and Federal President or the General Sccretary and four Federal Management Committee merbers or upon the petition of two or more branches or on a petition signed by any 1,000 members. The control in between meetings of the Pcederal Council is exercised by the Federal Committee of Management which consists of the President, Senior and Junior Vice-Presicents, the General Secretary, the Treasurer and three Trusices. They are elected by and from the Council. MThe President has a deliberative vote only. Actions of the Fcderal Committee of Managerent may be considered and reversed or altered by the Federal Council or by a majority of the members of the Union on a referendum. It will be seen then that the federal Council consicts of 19 members plus the Cene1lal Secretary and Assistant General Secretary. Rule 13A prevides that members of any three branches at meetings at which not less than 1, of the financial members are present may by resolution request that a refcrendum bo taken on proposais that Lr the Managernent Camm: ttee or Covne1l take or refrain from 19. taking any specified action or from adopting any specified policy. In addition, in my view the Federal Council has power under rule & either at an ordinary or a special meeting to decide to take a referendum itself. Tts powers under rule 8 are as follows: "The supreme control of the Union is vested in the merbers. Subject thereto the Federal Council shall be the governing body of the unicn. [It shail have the gene1al control and conduct of the business of the Union and without limiting the foregoing its powers shall include the following: none of wnich is to be limited in 1ts generality by the existence or another. (1) To take all such steps as 1t shall think fit to carry out all or any of the objects of the Union. (11) ''7o0 do anything which might be done by any committee or bedy or meeting or officer of the Union or any part thereof." A direct control of the committeos by the merbers may be exercised by the holding of a referendum under rule 13" or by the power of a majority of the Federal Council to decide itself to hold a referendum. It 1s true that three branches may not represent a mazority of the members, or, to put at another way, that the New South Wales branch in combination with one of a number of other branches may represent a majority of members and yet fail to obtain the support of a thard branch to reouire a referendum. 20. One must however look at more than the mere machinery. Referenua are a cumbersome, time-consuming and very expensive operation for a union. As a matter of practice, and indeed I think by necessary implication, they would be conducted by secret postal balloc and they would involve the printing of cases for and against a particu- lar proposal. This being so, the cost to a union is very great and the union 1s entitled to limit the right to a referendum to truly important questions. To consider the position of members desiring to exercise control over the committees, I take firstly the branch committee of management. Provision 1s made for branch committees of management to be elected by the members. Special meetings of the branch must be held if requisi- tioned and the numbers required to requisition a meetirg are small. The branch committee of management must comply with any direction given by a branch meeting of members at which not less than 135 of the financial membors of the branch are present. This scems an entirely reas- onable scheme which 1f anything may be said to be extrere- ly favourable to those members seeking to control the branch committee. I turn then to the positicn of members seeking to control the federal committees by a referendum of members. they may do so either by seeking a refcrendcur under rule 13A or seeking a reforendum ordcred by council. In the former 21. case members may summon a special meeting of the branch and issue a direction to the branch committee of manage- ment to initiate the action. The branch committee of management would then if so directed seek the co~operation of two other branches. If it obtains this then the ref- erendum must be held. It 1s wrong however to assure that each branch is homogeneous and the members of each branch united in their views. It 1s much more likely that if there is a division of opinion this would be reflected throughout the union. If other branch committees refuse to co-operate in the call for a referendum, action could be taken to call special meetings of their members to give appropriate directions to the other branch committees of management. In this way a referendum may be required even though opposed by the federal bodies. If however two other branches do not co-operate then the avenue is still not closed to the dissident members. If they rep- resent a sufficzent Lody of opinion within the union a requisition for a special meeting of the federal council may be made by two branches or one thousand members. At that special meeting there would be prescnt the nineteen delegates plus two officers. In the same manner as T have indicated earlier, special meetings of branches may require that the branch committee of management instructs its representatives to vate for the holding of a referendum. Jn a vote on such a refer- endum it would not be proper to regard the General Secretary 22. and Assistant General Secretary as representing any particu- lar branch or branches. They are elected by the whole of the members and 1t 1s to the members generally that they owe their office and are responsible. In the voting then on the federal council, if an issue arose on which, for example, the New South Wales branch sougnt the holding of a referendum and this was a genuine desire of the majority of the members of the Union one would expect the Secretary and Assistant General Secretary to be responsive to that desire. 'here would tnen be a total of eight votes in favour of the resolution and it would be necessary for the New South Wales branch only to attract the vote of the delegates of one of the victorian, South Australian or Queensland branches, each of whom has three delegates, or of the Western Australian and Tasmanian branches, each of whom has two delegates. Alternatively, having regard to the realit'es that in very many issues branch members and branch delegates may have views which differ, 1t would be sufficient for ther to attract votes from three dele- gates scattered over the five brinches. Another feature which appcars from the rules is that there 1s a complete opportunity for members to have a forum 1f£ they wish to deal with the activities of the committees. There 18 provision for union delegates. The provision for meetings include section meelings and branch meetinas as I have andiceted and no diffsculty shovid he found bv a 23. Majority of members in any branch or indeed any significant minority in securing a meeting and ventilating any views they may have on the activities of the committee of management. The question which then arises 3s whether this 18 a suffic- lent conpliance with the statutory requirements. By vartue of s.132 of the Act organizations must comply with conditions as prescribed. The relevant prescription is Regulation 115(1)(d), By virtue of this regulation the rules must provide for the control of committees of the association and its branches by members of the association and the members of the branches respectively. The word "control" has been Jescribed es an "unfortunate word of such wide and ambiguous import that it has been taken to menn sonething weaker than restraint; sone- thing equivalent to regulation" (per Dixon J., as he then was, Bank of New South "Wales v. The Tommonywcalth 76 C.L.R. 1 at 385). It must be viewed 1n the centext and having regatd to the subject matter. In the regulations, provision 1s nade for the election of committees of management, of officers and of any kody additional to the committee of management "which 1s empowered to determine policy or io oxercise functions of management in the association or branch". Regard must be paid te the chief objecis of the Act which are: "s.2(a) to promote goodi211 in industry: (b) to encourage, and provide means for, concili- ation with a yiew te amicable agreerent, therehy preventing ana settiing industrial Gisnutes; 24. (c) to provide means for preventing and settling industrial disputes not resolved by amicable agrec: nt, including threatened, impending and probable industrial disputes, with the maximum of expedition and the minimum of legal form and technicality; (ad) to provide for the observance and enforcement of agreements and awards made for the preven- tion or settlement of industrial disputes; (e) to enconrage the organization of representative bodies of employers and employees and their registration under this ct: and (f£) to encourage the democratic control of organ- izations so registered and the full participa- tion by members of such an organization in the affairs of the erqanization._" The importance cf these in the consideration of rules is emphasised by s.140(1)(a)-(c). Among other things, they must not impose upon members corditions, obligations or restrictions which having regard to the objects of this Act and the purposes of the registration of organizations are oppressive, unreasonable or unjust. Object (f) is also of importance as a new provision inserted in 1973. It at least assumes that there nay not be a complete or perfect democratic control of organizations by providing that one of the objects of the Act 1s to encourage that very thing. The purpose of incorporation and registration of the organi-~ zation is to facilitate the scheme of conciJiation and arb- atration and in corsidering the degree of control sufficient for the purpose ot the requlation, one must have regard to this purp se. A unton mist be representative of ite members. At the same tine, it reuist have bodics capable of making policy 25. decisions and carrying out functions of management and officers and committees are expected to be able to influ- ence and control their members in industriai relaticns (see for example. s.33, s8.132A, s.143 of the Act and Trade Practices Act s.45D). Occasions must frequently arise when quick Gecisions must be made in circumstances where there 1s no possible time for determination by a referendum. The Gegree of control cannot be so great as to ensure a direct Majority vate of members on all or even most issues. Added to thzs is the fact that a series of referenda could quickly bankrupt a union and that the system is cumbrous, slow end time-wasting. The union then in my view 1s entitled to ensure that a referendum is used only when an issue of vital importance arises and is entitled so to frame its rules to achieve this. Referenda are not common in Australian politics and J see no reason to think that they form a necessary part of control by the members of the committees they have elected. Here however J am dealing with a case where provisions for a referendum do exist. It should be added that the legisialure has mors and moxc encroached on the field previcusly covered by regulations. Provision was early made to ensure thar the rules were per- formed end observed by providiny the remedy in s.141. Section 145 in various forms has ellowed 1n some cases the disallowznce aud in others the making of decisions concerning Pp the validity of rules. More recently there hate beea provis to ensure properly conducted bullots and that persons holding Ons 26. office are properly elected and so truly represent their members. In addition the power of removal of officers, provision of which 1s required by regulation 115 has now been dealt with by statute and the circumstances in which 1t may be exercised specified. So, toa, audits and finan-- Cial records are dealt with. It may be said also that apart from any provisions in rules committees of managemenl may be obliged by orders under s.141 to perform and observe the Luies. In exercising any sule- making powers they may have they are subject to the powers of the Registrar under s.139. In elections they are further subject to the provisions of s.133A and Part Ix. All these provisions lay down a formidable svries of provisions in which there are restriciions and controls and methods whereby action may be taken agains! conmitteos by members to enforce the rules or provisions of the Act or regulations, all designed to ensure a demucratic union. Before turning to the authsrities there arises the 7tLestion raised in Ex Parte John Peter Maynes_ and O1s. 19 May, 1978. In that case Mason J. in a judgment which was agieeld to by Barwick C.7., Stephen and Aickin JJ. said: "Whether reg.115(1)(d)(v) 1s directed to the control by the newrers of the compos:tior of coimittees or the activities of committees or both is a question of construction and «s such it was an jesue which wie Court had ro dete.mine an the exercise of its juris- diction. It @ecided this :ssace ty co.cludsng that the regula@i:aicn required the direct election of conmit- tees by nembers of an organi 'stiaor. Jn so doing 1° 27. accorded to the regulation an interpretation similar to Lhe construction which I have placed on s.133(1)(a). No dovbt the Court apprecia'ed that there was this identity between the two provisions and, accordingly, in its formal order included par.(a) as well ace par.(b). The reasons which 1t advanced in respect of the regula- tion serve as a statement of its reasons for the conclu- sion which it expressed in relation to s.133(1)(a)." The present case was argued on the basis that the attack was made on the lack of control of the activities of the committees. No attack was made on the method of election of either of the bodies and T have therefore corsidered only that aspect of control of activities. Before looking at the authorities I should say that it seems to me that each case musi turn very much on its own facts and if there 1s evidence as to practice or the offect of certain rules that may be material. Here however trere was no evidence showing any inability of a majority of members to exercise its voice or control so far as the commitcecs are concernea. The evidence did how- ever show a somewhat changing position in the cumposition of the Union. The Tasmanian and Queensland branches seem of relatively recent origin and the Sueensland branch at preannt covers only part of that State. The Western Australian branch was formed as late as 1974, There 1s no reason to believe that chanye has ended in this anion or that the relaiive strength of the branch: s will rewain as at present. 28. The quesiion of the regulation requiring rules which exercise control was dealt with by the Commonwealth Court of Conciliation and Arbitration in Ford v. Federated Miscellaneous Workers Unior 79 C.A.R. 147. It appears that the rules of that union provided for a federal council and a federal executive. There was no provision fr nernvodic elections to the federal council. The federal executive was the committee of managesent and it was clected by the federal council. No provision appears to have been made purporting to deal with the contro] of the federal commirtees. Moreover although the union was oxgan)zed in brar.ches, no meeting of any of the most important branches had been held for many years because the quorum necessary for the validity of the meeting was such a figure that could not be obtained. Foster J. said at p.153: "There 1S no way provided in these rules whereby the control of the Committees by the members directly 1s secured. They can neither direct, comuand restrain, check nor forbid, nor can thev substitute theirr will and autherity for chat of the Committee of tanagement and the indirect power cxerted through the Federsl Council 's limited to a vower of removal and replacc- ment of some of rhe menbers of that commitiee." Again the Commonwealth Court of Conciliation and Arbitration in Spence v. Postal Workers €1 ¢C.A.R. 115 dealt with riles of a union where the governing b-dy appears to have been the annual confereuce and the managementl committee, the federal executive. The manayement committee wax clecied by delegates lo the annual conference. Different brauches of differing strengih each had one vote «n the clection. In addition a rule provided for the tak-ng of a plebiscite Dy a requirement of at lesi threc of tie branches. The judement ts short but 29. 1t appears that the attack on the rules was based on a failure Lo corply with the provision for election and further was a failure to provade for control of the commitlees. The judg- ment of the Court was delivered by Kirby J. who said: "The attack or. the particular system contained in rule 12 based on the Fact that the delegates from the differext branches repvesenting varying numbers of members have each one vote cannot 1n the opinion of my brothers Dunphy and Ashburner succeed, parti- cularly in the light of the provision for giving effect to the opinions of the members generally by plebiscite contained in rule 21 which my brothers consider svfficient in the circumstances of this particular organization, T am of opinion that the provision for the taking of plebiscites is not sufficiently protective of members generally, having regard to the requireme.t that at least three of the branches must dire:-t the conference or Federal Cxecutive to hold a plebiscite on a parti- cular question," ny Examinatioc of such of the fules as are available sugges that the cffect of such a rule was that two branches compris- ing probably the majority of members could not require a plebisvite io be held. The questior. has also beon considered by the Commonwealth Industrial Court in Mackerzie .. Administrar Y " £ and Clerical Officers Associciion 5 F.L.R. 342. The rules in ce that case provided for the etection of officers by a federsi confere.ce. Federal conference was conposed of delegatcs elected by each branch. Two delegates from e¢ach branch irre- spective of the numbers in the branch were elected. The total membership was just under 20,900. The two biggest branches each had 5,000 odd reibers and the smallest branch Therc wore seven branches of the ergenizatin.. Provigion was made for a plediscitle but onlvy if so reqaired by at leas* four 30. branchcs. If a plebiscite were held and the proposal carricd by a majority it would not become offeclive unless in addition to the majority of members there was a rajority in four of the seven branches in favour. Of these rales Spicer C.J. said: "These considerations lead re to the corclusion that the rules are capable of operation so as to prevent the will of the majority cf members prevatlinyg. To that extent the, fail to provide for control of cor- ference and the executive council by the members, and impose upon the memLers corditions which are oppressive, unreasonable and unjust. Tn a constitu- ticn of this kind 1t 1s not improper or inappropriate to have provic:ons which ensure some stability and enable those charyed with irs management and adnini- stration to promote its policy without regard to every fluctiating change in the views of members. On the other hanl a constitution which is so framed that the will of the majority may under 3+ never prevail seoms to me to offend acainst the Act and the regulations." In Liucknan «7. Australian Postal and Telecommunications UJUnicn {unreported - 10 October, 1978) I considered the case of a union which cornrised s1x branches, two of them very much greater in strength than the others. Control of the union rested with an annual corference and a federal executive. The annual c.nfcrence consisted of two delegates from each State together with seven office s who were elected by the whole of the membcrship. The officers however were not entatle@ to vote on any issue. J then said: "Tn considering rule 6 it 1s quite plain that the two biggest branches comerising €5% of the members, may have their will thwarted by the representatives of the smaller »ranches representing some 35% of members. This follcws breause eact. branch av conferences hus che same number of votes. A rale in such form anp ars to me not 10 afford @ proper mersure of control of comn- mite ce of the onien to tie momhes 5 of Fhe anion. Tt quite clearly docs not wate for Gcnotratic control of the inioe aad is to uw tti.nd ove ve ich impos*s conditicr . which are oppicesive® ani uaqust." 31. It will be seen then that there ere material differences between the rules which have been considered in each case and I again emphasise that each case must be determincd on its own facts and its own rules. Having regard to the whole of the circinstances here includ- ne ing what seems to me a factor of major amportance, that two officers elected by the whole sf the membership wre members 1. of the council with equal rights, Tt chink that these rules do rol. offend against the provisiocrsa of the regulation. The rules T am considering differ quite materially from those in the earl.er cases. In Mackenzie's Case 5 F.L.R. 342, for example, the unio: had seven branches, two big and five smaller. Each branch was entitled to the same number of delegates at conference and delegates only had a vote at the conference, Three officers were electcda by the confirence and the fourth was not ejected but apaarentiy appointed. Tt was noi only necessary for forr branches to require a plebis- cite but the matter on which tie vote 'as taken had ta be approved not merely by a majority of the toral volers but by a majority in a majority of Stetec. In Luckmen's Case (10 October, 1978) again only branch delegates, the sam number from each pranch were entrLled to vote at the conference. There were 21x branches, two lazge and four small. A plebiscite migii be dir-cted only by the confercnee or the executive but the € rosutuve wes Found lo act as divccied by a majority of branches. Tn Fel v. Pedcrated miccellareois 32. Workers Union 79 C.A.R. 147 there was no provision for periodic elections to the federal council, the dominant body. The rules were such as to make it impossible for branch meetings to be held. In Spence v. Postal Workers 81 C.A.R. 115 the annual conference and the manage.ent committee were composed of delegates from hranches of dif- ferent strengths but each of whom exercised one vote only. Nonetheless the majority of the Courl held that a ple>dis-— cite requisitione'?l by at lesst three of the branches gave sufficient control. I have had reyard to these cases but I think the so™ tion must be found in the riles of the unjyon under co. sicdleration. It 1s true that there will be soae «ircumstanves in which the will of a majority may be thwarted in between elections 1. but since there are elections by secret belliot by rank an file members of the union this would] appear to be a passina phase only. Tt 1s no novel~y in a democratic society to find that tie will of a majority mey not prevail owing, for example, to the vacaries of an electoral system but the fact that this might happen has not led to a characterisation of such a sociery as other than democratic. Looking at the whole puro vse of che organization and its need to function in its cupacity as .epresentative of a class of employees, [I think that rule 134 sufficicenrly provides control as required in the reeulatton whea yr is read in coryjunction with the othec ruies of the orgenizgrtison. When an oprozcimty 1S given to raise issues at meetings, Lo organize Suppor. 33. to have views placed before the federal bodies at special meetings 1f necessary these coupled with the power to require a plebisciie scem to ie lo suffice. I summarise my findings as follows: (1) Rule 11(g) 1n 1ts registered form Goes not conform with s.140. However in view of the fact that it has been repealed and the repeal lodged for certifi- cation I stand this matter over generally with leave to either party to restore it to the list on 4% hours nolice. (2) As to the application under s.141 I am satisfied that the new rules wece validly adopted. (3) I am of opinion that rules 11(g) and 16(10) in the form adopt=d by the organization and now ladged for certification are not in disconformity with s.149, (4) I am of opinion that rale 13A and the rales generally are not in .lasconformity with s.140 in failing to provide for the controij of comiattees of the assca. ia- i1lon by the menbers. Foc these reasons I discharge the order in metier V.36 of 1978. . ee nee ee