CATCHWORDS Sydney Branch No. 10 Industrial law - Election inquiry - failure to comply with procedural rules re ballot papers ~ whether rule mandatory or directory ~ eligibility for membership of candidate and certain other persons - ballot papers forwarded to persons members of Institute but not members of branch ~ Whether person eligible when admitted to membership ceasing to be eligible remains a member - Conciliation and Arbitration Act, 1904 8.165, s.144, Reg.115(1) (d) (viii). N.S.W. 10 OF 1980 APPLICATION BY HAROLD HENRY SIMS FOR INQUIRIES INTO ELECTION IN THE AUSTRALIAN INSTITUTE OF MARINE AND POWER ENGINEERS (SYDNEY BRANCH) CORAM: J.B. Sweeney J. Sydney 29 September 1980. IN THE FEDERAL COURT OF AUSTRALIA INDUSTRIAL DIVISION ) No. 10 of 1980 ) ) NEW SOUTH WALES DISTRICT REGISTRY . IN THE MATTER of the Conciliation and Arbitration Act 1904 AND IN THE MATTER of an application by HAROLD HENRY SIMS for an inquiry into an election for officers of the Australian Institute of Marine and Power Engineers, Sydney Branch ORDER JUDGE MAKING ORDER: J.B. SWEENEY J. DATE OF ORDER: 16 October, 1980 WHERE MADE: Sydney THE COURT ORDERS THAT: 1. 5. 6. The election conducted in 1979 for the office of Secretary of the Sydney Branch of the Australian Institute of Marine and Power Engineers be declared void. That Mr. C. Yule a person purporting to have been elected to the said office be declared not to have been elected. That the Industrial Registrar make arrangements for a new election to be held for the said office. That Mr. H.H. Sims being a person who held before the purported election the said office act in the office of Secretary of the Sydney Branch of the Australian Institute of Marine and Power Engineers until the result of the new election be declared. Order (4) is to operate from 7 November, 1980. Liberty 1s reserved to either party to apply on 48 hours notice. wl iN _THE FEDERAL COURT OF AUSTRALIA) INDUSTRIAL DIVISION ) ) ) NEW SOUTH WALES DISTRICT REGISTRY) J.B. SWEENEY J. This No. 10 of 1980 IN THE MATTER of the Conciliation and Arbitration Act 1904 as amended AND _ IN THE MATTER of an Application by HAROLD HENRY SIMS for an inquiry into an election for officers of the Australian Institute of Marine and Power Engineers, Sydney Branch. 29 September 1980. REASONS FOR JUDGMENT reference by the Industrial Registrar referring to the Court, pursuant to s.160 of the Conciliation and Arbitration Act, 1904 ("the Act") a matter, an application by Mr. H.H. office of Secretary of the Sims for an anquiry into an election conducted for the Sydney Branch of the Australian Institute of Marine and Power Engineers ("the Institute") having been granted. The inquiry was, by consent of the parties, heard at the same time as an enquiry into an election held for the office of secretary of the Victorian Branch. Pursuant to directions given at a directions hearing, points of claim and of defence were filed by the parties. At the hearing, Mr. W. Haylen of counsel appeared for the applicant in each inquiry. Mr. R.C. Kenzie of counsel appeared for the Institute 1n each inquiry and for Mr. Roberts, the successful candidate in Victoria in that inquiry and for Mr. Yule, the successful candidate in the Sydney election. Mr. G.T. Johnson appeared for each returning officer. Affidavits by each returning officer were filed and it was indicated that each of the gentlemen would be available for cross examination if required. Mr. P.R.A. Gray sought leave to appear for the Municipal Officers' Association of Australia. He based his intervention on the fact that a material consideration in the inquiry would be the proper construction of the conditions of eligibility rule of the Institute and that there were proceedings before the Registrar at the present time in which the Institute was seeking consent to a change in the conditions of eligibility which the Association had opposed. In view of the particular circumstances I gave him leave to intervene on the particular question of the proper construction of the conditions of eligibility rule of the Institute. The irregularities alleged were that some 37 ballot papers returned to the returning officer had been rejected by him and that 3 others had been rejected which should have been counted as votes for Mr. Sims. It was further claimed that Mr. Yule was not a member of the Institute, not having been properly admitted and was therefore not qualified to contest the election and it was finally alleged that a number of persons had been treated as members and forwarded ballot papers although they were not entitled to be admitted as members, or were no longer eligible for membership and consequently not entitled to take part in the ballot. I take firstly the allegation concerning the 37 ballot papers excluded from the ballot. The Institute has rules providing in detail for the conduct of ballots including the ballot for the election of Branch Secretary. The rule provides that the returning officer, who was in this election, an officer of the Australian Electoral Office, forward to each financial member of the Branch a ballot paper together with two envelopes, one an outer envelope marked "Ballot Paper" and addressed to the returning officer and the other an inner envelope. In this case the returning officer also forwarded certain other matter, including extracts from the Act and the relevant regulations made under the Act. The rules then provide that the voter shall indicate his vote by striking out the name of any candidate for whom he did not wish to vote and that he place the ballot paper in the inner envelope and seal it. He shall also place the inner envelope, without any other matter, in the outer envelope upon which he shall endorse his name and seal it and then post it or cause it to be delivered to the returning officer. The rules then provide any ballot paper which, in the opinion of the returning officer, plainly indicates the voter's intention, shall be valid but, otherwise, any vote contrary to these rules or which otherwise fails to observe the directions contained on the ballot paper, shall be deemed informal. The ballot paper contained on it directions that the ballot paper must be completed by the voter personally and that he must thereafter fold it so as to conceal the way in which the vote was cast and place it in the envelope marked "Ballot Paper". That envelope containing the ballot paper was then to be placed in the outer envelope on which the voter was to endorse his name, seal 1t and post it. The purpose of the rule 1s quite apparently one designed to prevent irregularities and in view of the fact that at least a considerable proportion of marine engineers could be expected to be at sea and the ballot paper was posted to the voter's place of residence, it was 1n my view a precaution to which importance was properly attached. The rule uses mandatory language. On its proper construction, a ballot paper which is dealt with by use of the inner and outer envelopes, as prescribed, but which may have failed to use the method of striking out a name but still clearly indicate the voter's intention, would be valid but if the procedures for use of the inner and outer envelopes were not followed, the consequence of the rule was that the ballot paper was to be deemed, 1.e. adjudged, informal even though an intention was indicated. In the parcel of 37 votes which were rejected, 3 contained material utterly unrelated to the election, 19 had no endorsement upon the back, 1 was endorsed with the name of the Institute not the voter, 1 was endorsed only with the letters "Pp" and 13 had the outer envelope correctly endorsed but contained no inner envelope, the ballot paper being immediately accessible within the outer envelope. In this last case the effect would be that 1t could be ascertained on opening the outer envelope and unfolding the ballot paper how a particular person had voted. This would impair the secrecy of the ballot. In the other cases, i1t was not possible to compare handwriting or signatures and so a check to ensure that it was the member who had voted could not be made. In my opinion the returning officer was correct 1n his rejection of these papers and rightly took the view that the rule was mandatory. The second irregularity concerned the rejection of 3 other ballot papers. In 3 of these cases a cross or a tick appeared against the name of Mr. Sims but the electoral officer took the view that in an election in which voters were directed to strike out the name of the candidate for whom they did not wish to vote, the placing of a cross or tick against the name of one of two candidates does not enable a decision whether it was intended to vote for or against that candidate. In my view, the returning officer acted correctly in rejecting these votes. No irregularity occurred in these cases. The next irregularity alleged 1s that the successful candidate was not duly admitted to and so was not a member of the Institute and it is further clazmed as an irregularity that a number of other persons, although not duly admitted to membership, were forwarded ballot papers. A third irregularity 1s that 1t was claimed that persons who might have been members of the Institute but were not members of the New South Wales Branch were forwarded ballot papers. In the actual election there were, as I have said, two candidates, the successful candidate, Mr. Yule received 235 votes, the unsuccessful candidate, Mr. Sims, rece1ved 229 votes and there were 5 which I have already mentioned which were declared informal. It will be seen then that the majority in favour of Mr. Yule was slight. In considering Mr. Yule's eligibility and the eligibility of certain other persons, 1t 1s necessary to consider the rules specifying the conditions of eligibility for membership. Before turning to the rule, I should JI think state my views on the effect of such rules. The provision of a rule specifying these conditions has long been a requirement of registration and of organizations and the purpose is clearly to enable identification of the group or class of employees a registered organization represents. Such a rule is then fundamental to the workings of the Act. In my opinion unless a person 1s within a group or class specified in the conditions of eligibility he cannot be admitted to membership (R. v. Hibble and Others, 29 C.L.R. 291 particularly at p. 296 - 7 and at p. 303). This view has been repeatedly followed in cases dealing with the Act. (R. v. Watson, 128 C.L.R. 77 at 78, 84 and 87; R.v. Gough, 133 C.L.R. 59 at 67; R. v. Cohen, 27 A.L.R. 263). In the case of any organization there will clearly arise cases where a person was eligible and became a member when he was admitted, but subsequently changed his occupation and ceased to be eligible. In the case of many organizations, rules provide in such cases for the removal of such persons from membership but if there 1s to be a power to remove, it must be provided for in the rules. Regulation 115(1)(d)(v1i11) provides that the rules shall provide the times when and terms on which persons shall become or cease to be members, Cf. (Williams v. Hursey, 103 C.L.R. 30 at p.73-4). It may be noted that the English courts in dealing with trade unions existing under the Trade Union Act have taken the view that unless a person is qualified under its constitution, he cannot validly be admitted (Martin v. Scottish Transport and General Workers Union, 1952 1 All E.R. 691). In dealing with each of these alleged irregularities it 1s necessary to consider the rules of the Institute. I may mention in passing that it was agreed by all appearing that the rules were ambiguous but I think it 1s rather flattering them, to leave that as their description. They are I think defective in very Many respects and where they do make provision it 1s in language to which it is difficult to apply any rules of construction or even rules of syntax. The Institute began life in 1906 and was then registered with a conditions of eligibility rule providing that it should consist of engineers, honorary associates and honorary members, with qualifications as thereinafter defined. The rules have been amended a number of times, both before and after, the consent of the Registrar was required. It now provides: "The Institute shall consist of engineers, Marine and power plant (hydraulic and electrical), stationary and self-propelled dredges, tug boats and pilots vessels, associate members, honorary associates and honorary members whose qualifications for each are as hereinafter defined. Membership shall be divided into three sections - seagoing mechanical, seagoing electrical, and other than seagoing. (1) Seagoing members (mechanical) shall be engineers who have passed the examination and are in possession of certificates recognised by the Ministry of Shipping and Transport or who have passed Part A of the Second Class Ministry of Shipping and Transport Certificate and/or the Leaving Certificate or its equivalent in New South Wales, or its equivalent in the other States of the Commonwealth, and who have served an apprenticeship. (11) Other than seagoing members shall be engineers who are working ashore who have passed one or more of the abovementioned examinations or an examination equivalent thereto or who have served an apprenticeship and who can satisfy a branch that they are in possession of qualifications similar to those held by persons mentioned in paragraph (1) herein. (111) The term of apprenticeship (Mechanical) shall be understood to mean having worked for a period of not less than four years at the Engineering Trade as defined by the Ministry of Shipping and Transport Regulations, or served such apprenticeship as defined by Ministry of Shipping and Transport Regulations, or served such apprenticeship as 1s required for qualification in their respective callings, except apprentices, who an the last year of their time shall be eligible for membership. Provided that the full term of a recognised apprenticeship in the Electrical Division or authorised apprenticeship as an Electrical Fatter or an Electrical Mechanic has been served. (iv) Engineers in possession of any Marine Engineer's Certificate recognised by the Commonwealth or a State in accordance with the provisions of the Navigation Act may be elected as Members. (v) Candidates for membership shall be persons eligible for engagement as officers on vessels engaged in the coasting trade in accordance with the Navigation Act 1912 - 1967. (vi)(a) Any person possessing such qualifications and/or experience which will equate him to the level of a qualified and experienced marine engineer may be admitted as Associate Member. (b) Persons who are pursuing a course of training in the Marine Engineering industry or a similar training ashore with the object of becoming a qualified Marine Engineer. " The rule being admittedly ambiguous, I think it is proper to have regard at least to the description of industry rule in an attempt to elucidate its real meaning (R. v. Watson; Ex parte Australian Workers Union, 128 C.L.R. 77; R. v. Gough, 133 C.L.R. 60). In each of these cases the High Court took the view that the context provided by the description of industry rule could be looked at in attempting to place a meaning on ambiguous words in a conditions of eligibility rule. It was urged in this case that it would be proper to look at the rules generally for this purpose but in my view this 1s not so. The rules providing for or changing the name, the description of the industry and the conditions of eligibility for Membership must be consented to by the Registrar before they are registered and do not become effective until registration. In considering whether he should consent or not, the Registrar will no doubt have regard to any questions of overlap with other organizations and questions of conveniently belonging and the like, including the general policy of not having, where possible, il more than one union covering the same groups and classes of employees. This 1s not so with other rules and in my view an odd position would be created if the meaning of a conditions of eligibility rule could be affected and perhaps altered by changes in rules to which the consent of the Registrar was not necessary. As an example, it was submitted that I could seek assistance in the construction of rule 3 and its possible application to engineers employed in hospitals by looking at rule 28 dealing with fees and contributions which provided a scale of fees for hospital engineers by an amendment to the rules made in 1975. At all relevant times the industry in connection with which the organization 1s registered has been described as "shipping and power plant (mechanical and hydraulic)". Turning to rule 3, 1t appears to have begun by providing that the Institute shall consist of engineers, marine, honorary associates and honorary members whose qualifications for each are as hereinafter defined. I may mention that one difficulty which arises 1s that certain documents from the Registrar's file seem no longer complete, no doubt due to the great lapse of time but the history of changes to this part of the rule appear to be as follows: 1. The first material change seems to be that in 1922 the words "and power plant except engineers working ashore regularly using the working tools of an engineer" were added after the word Marine. 2. In 1925 the words "(hydraulic or electrical)" were added after the words "power plant". 3. In 1933 rule 3 was further amended by adding words dealing with qualifications of engineers and this was again done by adding further qualifications in 1951. At that time rule 4 set out what were described as equivalents to the qualifications which were in rule 3 and a further rule 4 adding certain further qualifications was adopted in 1961. 4. In 1968 the words "stationary and self propelled dredges, tug boats and pilot vessels, associate members" were added after the word "electrical" in rule 3. Further amendments were made to rule 4. The history illustrates if nothing else, the extreme confusion. The rule has been considered by the Commonwealth Conciliation and Arbitration Commission on a number of occassions, the last being a consideration by a full bench of the Commission on 11 October 1978, Print No. D8554. The Commission's attention was directed particularly to the words "power plant, hydraulic and electrical" with particular reference to engineers engaged in hospitals. It appears that it was argued that those words should be interpreted to extend to engineers working on any plant powered hydraulically or electrically. The Commission rejected that view, saying: It 1s our view for the above reasons that the correct interpretation of the expression under consideration is that as regards electrical equipment it does not extend to all plant powered by electricity but 1s limited to power generating plant (ancluding auxiliary plant). Whether there are engineers employed on such plant by the various employer respondents 1S a matter more appropriate to be decided by Isaac D.P." The importance of the question for this case is that among persons admitted to membership were some who at the time, were employed in hospitals, some on air conditioning plants and other plants powered by electricity and possibly some on emergency generating plants when they were in operation. Mr. Kenzie, counsel for the Association and the successful candidates, said that he accepted the decision of the Commission and did not seek to have it departed from. I do not propose to attempt any overall definition of rule 3 since so to @o may affect the rights of other oroganizations but I will reach a view only so far as is necessary to reach a conclusion in this inquiry. The rule sets out in the first paragraph of rule 3 that: "The Institute shall consist of engineers, marine and power plant (hydralic and electrical), stationary and self-propelled dredges, tug boats and pilots vessels, associate members, honorary associates and honorary members whose qualifications for each are as hereinafter defined." The paragraph then provides that membership shall be divided into three sections, seagoing mechanical, seagoing electrical and other than seagoing. The balance of rule 3 then sets out various qualifications while rule 4 sets out what are said to be equivalents to the examinations referred to in the second part of rule 3. In my view neither the parts of rule 3 other than the first paragraph nor rule 4 widen or enlarge the conditions of eligibility for membership beyond those stated in the first paragraph of rule 3. To regard them as doing so would be to widen the conditions of eligibility far beyond anything possibly contemplated. If rule 4 1s to be given full effect to and is to be read in conjunction with rule 3 apart from the first paragraph of that rule then the effect is that the holder of a school certificate issued by the New South Wales Department of Education who had served an apprenticeship of any nature would be eligible for membership. The number of trades to which apprenticeships May be served 1s very great and goes far outside the calling of marine engineer or the industry of shipping and power plant. They include hairdressing, pastrycooks, etc. It was put by Mr. Gray that the parts other than the first paragraph of rule 3 must all be read as qualifying the words "engineers marine" and that the phrase "power plant (hydraulic and electrical)" were also to be read as qualifying engineers marine. The affect of adopting that view would be that the only persons eligible for membership were marine engineers. In my view the conditions of eligibility rule goes somewhat further than that. It makes eligible "engineers marine" including those employed on "stationary and self-propelled dredges, tug boats and pilot vessels". Also eligible are engineers employed in power plant, hydraulic and mechanical and by this is meant, plant generating power for sale or supply to consumers. It 1s true that there does appear in rule 3, what Mr. Gray termed "a marine flavour", but treating the rule as ambiguous and from this view, there was no dissent, I think I must regard the addition of the words "power plant, mechanical and hydraulic" to both the conditions of eligibility rule and the description of industry rule as intended to add a class of person to those previously eligible for membership. I have sought from various sources the original form of the rules. It appears from Australasian Society of Engineers v. The Institute, 9 C.L.R. 48, that the Institute was originally registered as an organization of employees in connection with the shipping industry and that it was originally registered as an 16. association of marine engineers. It is not an entirely satisfactory starting point but it 1s the best available to me. In 1922 rule 3 provided that the Institute shall consist of engineers marine and power plant with some exceptions and in 1925 rule 3 provided that the Institute shall consist of engineers marine and power plant (hydraulic and electrical) with the same exceptions as in 1922. In my view then those eligible for membership under the rules are: 1. Marine engineers. 2. Engineers engaged on or in connection with power plant, hydraulic or mechanical. In each case the persons concerned are to have qualifications as prescribed in clause (111) or their equivalents as prescribed in clause (1v). Those with the particular qualifications prescribed in rule 3, clause (vi)(b) who are also qualified under the first paragraph of rule 3 may be admitted as associate members and may thereafter become honorary members or honorary associates. I do not regard clause (vi)(a) as dealing with a group who, with the qualifications there specified, whatever their calling or employment may be, as eligible for admission. They must be engaged in the callings of engineer, as earlier set out, otherwise a person with those qualifications and experience, whether employer or employee, whether engaged as manager in a clerical capacity, or whether in some engineering capacity unrelated to marine engineering or power plants such as construction engineering, or one of the many fields of engineering outside marine and power plants, would be eligible for membership thus cutting across the eligibility provisions of many other registered organizations. Effect of Finding as to Meaning of Rule 3 Documents were put 1n evidence, in particular a list of members to whom a challenge was made, which became Exhibit 'D'. It was admitted to be an accurate summary from the records of the Association and it clearly showed the admission of persons who clearly were not, when admitted, eligible within rule 3, as I have interpreted it. They include persons, for example, whose occupation, when admitted, was in one case plumber, in other cases fitter, in other cases electrician, in one case salesman, in another case works manager, and another lecturer. Ultimately concessions were made by Mr. Kenzie that a number of persons, who had been treated as members and to whom ballot papers had been forwarded, were not at the time of joining elagible for membership. These were Messrs. Hynes, Chappell, Reid, Swales, Koncharowsky, Prior and Wilson. These were 7 people who received ballot papers and the majority at the election was 6. In addition Mr. Kenzie, while agreeing that on the records certain persons might appear not to have been eligible at the time they were admitted to membership, submitted that by virtue of s.144 of the Act, they were eligible for membership, since they were at the time of admission desirous of becoming employed as marine engineer. There were a number of such persons. In respect of some there was certainly no evidence of any desire, in respect of others there was evidence that at the time of admission there was a desire that i1f certain events happened, such as in one case, the closure of the works where the person was already employed as a manager he might seek employment as a marine engineer. I am reluctant to make any finding on these persons although I regard their status as very doubtful. However, s.144 affords a method whereby the organization can seek declarations. On the one hand nothing appears from which I could infer that either the persons concerned or the Institute thought, that in the admission to membership they were acting or purporting to act under s.144, but that section while providing a means of enforcing a right, requires that the individual concerned should be heard before any order is made and I am reluctant to make findings concerning individuals when the person has not had any opportunity of being heard. Some of the difficulties which will arise will be whether, since the section gives a right and provides a remedy and since the deeming provision is for the purpose of the section only, an action by an organization in purported compliance with the section, other than the remedy specified, is valid. Moreover, problems will arise as to when the desire referred to in s.s. 3(b) must exist. At least 1t must be something more immediate than the desire still said to be held by every boy to become a train driver. In some of the cases to which reference was made in this inquiry the desire appears to have been far from immediate and not to have been demonstrated in any way, nor does anything appear on such records as were produced to show whether the branch admitting the person was acting under s.144 or was acting under a mistaken view of the conditions of eligibility rule. I make no final decision in these matters for the reason I have advanced above. In this particular election it 1S common ground that 106 persons, who at the time of the election, resided outside the State of New South Wales, were forwarded ballot papers. As has been pointed out under rule 33, only financial members of the Sydney Branch were entitled to receive ballot papers and it has been submitted on the one hand that to be a member of a branch a person must reside within the area of the branch. The rules on this matter are as obscure as they are on many. It 1s quite clear that the Institute consists of a head office and branches. In rule 7 the branches appear to be six in number - Queensland, South Australia, Western Australia, Victoria, Sydney and Newcastle. The branches as so described cannot each be confined to a State. Sydney and Newcastle are clearly not and there appears to be no Tasmanian branch. There 1s no rule stating the area covered by a branch. Moreover there 1s no rule at all indicating to which branch a member is to be attached. As against the submission that members of the Institute became members of the branch by which they were admitted to membership, the records produced to me show that this has not been the invariable practice. In the case of a Mr. Griffiths, he was admitted by the Newcastle Branch but had a vote in the Sydney Branch elections, while Mr. Roberts was admitted by the Newcastle Branch but subsequently became a member of and ultimately, Secretary of the Victorian Branch. I should add that the rules make no provision for the transfer of a member from one branch to another, either at the instance of the Institute or a branch, or at the instance of a member. Again Mr. Yule, the successful candidate for the position of Secretary was, about 1967 admitted to the Newcastle Branch and in 1970 his membership in the Newcastle Branch having terminated in 1967, he was admitted to the Sydney Branch. On consideration of the rules it appears to me that there is no provision which could properly be implied in the rules. Applying principles in Heimann v. Commonwealth of Australia, 38 S.R. (N.S.W.) 691 at 695, it 1s quite impossible to imply a term. It 1s quite clear, however, that the rules clearly contemplated there being branches. That being so, there might have been action taken under rule 8(111) which gives power to the Federal Council to decide questions on which the rules are silent but although a challenge was made in the points of claim, there was nothing put before me to indicate that any action had been taken under rule 8(111) even assuming its validity. I fand myself then unable to determine that there has been any breach of the rules but having regard to the rules and the few instances which have appeared quite accidentally in documents produced, I think there are circumstances giving rise to a likelihood that persons not entitled to vote in the election in these circumstances, received a ballot paper and may have voted and that as a consequence the result of the election may have been affected. I am satisfied that irregularities occurred by reason of the 7 persons, whose names I have set out, receiving ballot papers. I am further satisfied that having regard to the list of names on Exhibit 'D' and the occupations there shown as those of persons at the time of admission it as likely that further zrregularities of a similar nature occurred and that they were breaches of the rules. I further find, as I have indicated that a considerable number of persons who not having been entitled to vote because they were not members of the branch did receive votes and I find that by reason of these matters the full and free recording of votes by persons entitled to record votes and by no other persons may have been prevented and hindered. As I indicated at the conclusion of the hearing, I publish my reasons and the findings I have reached and, as the parties then requested, the further hearing will be adjourned to allow submissions to be made concerning the orders the Court should make.