~¢ AAT Saou CL BETWEEN: y th a tu n, Gg it (EF. NCK =) ASSCCLAtS T Pastvice 2riallis Treats Mutgy 39 - wee er aah F CATCHWORDS Industrial Law - Registered organization - Rules - whether oppressive, unreasonable or unjust - whether members deprived of control of governing bodies - construction of rule concerning Divisions - Conciliation and Arbitration Act 1904 s.140(1) Bernard Jack Willingale -v- Australian Federated Union of Locomotive Enginemen (N.S.W. No.46 of 1982) EVATT J. Sydney 18 March 1983 IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY No. N.S.W. 46 of 1982 INDUSTRIAL DIVISION BETWEEN: BERNARD JACK WILLINGALE Applicant AND: THE AUSTRALIAN FEDERATED UNION OF LOCOMOTIVE ENGINEMEN Respondent ORDER JUDGE MAKING ORDER: EVATT J. DATE OF ORDER: 18 MARCH 1983 WHERE MADE: SYDNEY THE COURT ORDERS THAT : The order nisi herein dated 17 December 1982 be discharged. Date Entered: DISTRICI REGISTRAR IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY No. N.S.W. 46 Of 1982 INDUSTRIAL DIVISION wee SS BETWEEN: BERNARD JACK WILLINGALE Applicant LOCOMOTIVE ENGINEMEN Respondent AND: THE AUSTRALIAN FEDERATED UNION OF 18 March 1983 EVATT J. REASONS FOR JUDGMENT On 29 July 1982 the Court, in matter N.S.W. No.40 of 1981, determined that the then certified rules of the Australian Federated Union of Locomotive Enginemen (the organization), an organization registered under the Conciliation and Arbitration Act 1904 (the Act), making provision for the constitution of the organization's controlling body, the Australian Council (r.7(2)) and for the calling of a plebiscite (r.16) were, following the principles la1d down 1n McLeish -v- Kane (1978) 36 F.L.R. 80, contrary to the provisions of s.140 of the Act. In lieu of making a declaration pursuant to s.140(5G) the Court stood the matter over pursuant to s.140(6) 1m order that the organization be given the opportunity to amend its rules. No determination in respect of the validity of r.9(1), making provision for the constitution of the Committee of Management ,was made in that case. Thereafter .on 1 and.2 December 1982 certain rule amendments, including amendments to rr-7(2) and 16 were adopted by the Australian Council, the rule making body of the organization. Such amendments were certified by the Industrial Registrar pursuant to s.139 of the Act on 13 December 1982. os/2e- On 17 December 1982 Bemard Jack Willingale, Secretary of the N.S.W. Division of the organization and a N.S.W. delegate to the Australian Council was granted an order nisi pursuant to s.140 of the Act returnable in February 1983 wherein the respondent organization was called on to show cause why orders should not be made declaring that r.7(2) and r.9(1) of the rules of the organization contravened s.140 and further why an order should not be made declaring that on its true construction r.5(1) provides that all members of the organization employed by the Australian National Railways Commission constitute one Division anly of the organization. The matter came on for hearing on 18 and 24 February 1982. By consent the transcript of the proceedings, including submissions by counsel, in matter N.S.W. No.40 of 1981 together with the affidavits tendered before the Court in that case were deemed to be before the Court in the present matter. Further, the reasons for judgment in matter N.S.W. No.40 of 1981 (the earlier judgment) are to be read in conjunction with these reasons. It is noted that in the tables set out at p.7 of those roneced reasons for judgment the number of members shown for the Tasmanian Division is incorrect. 'The correct number should read 203 and not 302. Otherwise the percentages etc., for that Division are correct. Rule 7(2) as set out in the earlier judgment was amended so that the word "three" immediately following "3,000 members" reads "four". Rule 16 as set out in the earlier judgment was deleted and anewx.16 inserted-which 'reads: oe /3e. -3- 16é."The members of the Union shall have the following control over the Council and Committee of Management and Officers of the Union. If requested by resolutions of the Divisional Councils, or the members in special general meetings convened for the purpose, of any four Divisions, or any lesser number of Divisions having between them at the time of such resolutions not less than half of the total membership of the Union, a ballot of all members shall be taken in manner prescribed by these Rules within 3 months of the commmication to the General President or the General Secretary of the last of such resolutions, upon the question raised by the resolutions, and the decision of the majority of members voting shall be binding and conclusive". As stated above these two amendments were certified by the Industrial Registrar on 13 December 1982. No challenge is made by the applicant to r.16 im its amended form. But it 1s necessary in my view to consider this rule together with the rules as a whole when considering any imbalance in the constitution of the governing body of the organization. Before consideration is given to any imbalance in the voting strength of the various Divisions on the Australian Comal of the organization it 1s necessary to make a determination in respect of the application by the applicant regarding the construction of r.5. In my view this question is strictly not a matter which should have been raised as a separate and distinct matter under s.140 of the Act as has been done in this case. Nevertheless the true construction of r.5(1) is relevant when one has to consider what is the total number of Divisions within the organization in order to assess the voting strength of the Divisions at Council meetings. As this matter has been fully argued, a determination in this regard should be made. Relevant paragraphs of r.5 read: --/4.. -4- " DIVISIONS 5.(1) The Union may divide itself into Divisions and Branches for the purpose of carrying out the cbjects of the Union and also for administering the business and affairs of the Union and 1ts members. Divisions of the Union are hereby constituted for all Govemment Railway systems. (2) Any further Divisions of the Union may be created by the Rustralian Council, and such event any of these Rules dealing with Divisions shall apply to such further Divisions in like manner and insofar as the same are applicable. (3) Divisions may extend themselves into Branches and Sub- Branches. The applicant contends that since 1978 when the takeover of the Government Railways of South Australia and Tasmania by the Australian Government instrumentality, the Australian National Railways Commission, which had been initiated in 1975 became effective there has been but one Division for members of the organization employed by the Commssion irrespective of where such employees may reside or be employed. In fact such employees may be employed in Tasmania, South Australia, Australian Capital Territory and part of Westem Australia and in most cases actually reside in those States. It was claimed this resulted by force of r.5(1) particularly the last sentence thereof so that, in effect, both the South Australian and Tasmanian Divisions of the organization had then been absorbed into the Commonwealth Railways Division. This latter Division had apparently been constituted during the 1930's. Although there was no evidence of the history of its creation no doubt that Division was created pursuant to r.5(2). On the other hand the respondent organization submitted that the wording of the last sentence of r.5(1) showed that it was a creative » provision which, at the time of its insertion, -hadcthe effect of creating certain Divisions within the organization. The Divisions were constituted as at the time of registration of the rule in 1920. It was submitted o+/5ee -5- 1t was a sub-rule in the present tense which applied to the factual situation as at the time of its registration and it did not provide a permanent divisional structure for the organization. There is clear indication that this was intended when one considers sub-r. (2) which clearly gives to the organization through 1ts Council flexibility an how it constructs Divisions and does not limit the organization to having one Division for each Govemment railway system. Supportive of that interpretation 1s the object of the organization referred to in r.3(f) which reads: OBJECTS The objects of the Union are: 3. (a) to (e) .......-0- (£) To establish Divisions in each State or wherever required in the Commonwealth and Branches of such Divisions to cover all enginemen employed in all and every Government owned Railway system in Australia." (g) to (1) ...eeeeeee Further, the respondent organization submitted that the membership of the organization is not confined to employees of Government railway systems. The constitution of the organization provided for in r.2 of its rules des not so restrict membership but refers to various employees "engaged in and about the working or management of or incidental to any Steam Locomotive or Motor driven by electricity or other power used on any Railway". Further it 1s noted that r.6 makes provision for the admission of members. Sub-r.4 of that rule provides that all persons present at the inaugural meeting of the union held on 17 September 1920 and that all ~persons -enrolled and registered-as members of the union since that date and all members of various nammnated associations (State Unions) of Locomotive Enginedrivers in Victoria, Queensland, Western Australia, South Australia, New South Wales and Tasmania were declared to be and to have been duly admitted as members of the union. --/6.. -_ 6 - Tendered in evidence were two tables based on the membership numbers for the various Divisions as set out in the earlier judgment showing number of delegates, the proportion of such delegates to the total number and the voting percentage of each Division on the Council in accordance with r.7 as amended on 13 December 1982. Table A shows the said particulars assuming that there are Divisions of the organization in South Australia and Tasmania whilst Table B shows such particulars on the assumption that there is but one Commonwealth Division to cover all Commonwealth Railways employees including those 1n South Australia and Tasmania. It is noted that the General Secretary has the right to vote at meetings of the Council. Table A Division % of Members Number of Proportion of Voting % of Aust- Delegates Council ralian Council Vic 19.29 2 2/13 15.39 Qld 21.56 2 2/13 15.39 N.S.W. 39.01 4 4/13 30.77 W.A. 8.01 1 1/13 7.69 Commonwealth Railways 3.72 1 1/13 7.69 S.A. 6.71 1 1/13 7.69 Tas 1.67 1 1/13 7.69 General Secretary 1 1/13 7.69 Total 13 100.00 Table B Division % of Members Number of Proportion of Voting % of Aust- Delegates Council ralian Council Vic 19.29 2 2/11 18.18 Qld 21.56 2 2/11 18.18 N.S.W. 39.01 4 4/11 36.36 W.A. 8.01 1 1 9.09 Commonwealth '(including S.A. and Tas.) 12.10 1 Yu 9.09 General Secretary 1 1/11 9.09 11 99.9 we/Tse -7- It was conceded by the applicant that should the Court determine that there were no Divisions of the organization in South Australia and Tasmania (i.e. that there was but the one Division covering all employees of the Australian Railways Commission) then the constitution of the Australian Council of the organization could not be challenged. This would clearly be the case. The relevant table (Table B above) shows that under those circumstances the voting strength of any Division at Australian Council Meetings expressed as a percentage of the total votes within Council would be almost equivalent to the number of members attached to that Division as expressed as a percentage of the total membership of the organization (cf. Cook -v- Crawford, 52 F.L.R. 1 @ 19-20). I am of the view that the respondent's submissions as to the true construction of r.5(1) 1s correct. The history shows that the organization itself has regarded the members residing and working within South Australia and Tasmania to be attached to Divisions in each respective State. The applicant in support of his submissions in this regard has relied upon the fact that there was but one Federal award covering the employees of the Australian Railways Commission. But an examination of that award discloses that the award in fact 1s divided into three parts in respect of the two individual States namely, South Australia and Tasmania and the old Commonwealth sector. Tinally in this regard it is noted that subsequent to the date of the earlier judgment of 29 July 1982 the Australian Council of the organization on 1 and 2 December 1982 at a Special Australian Council Meeting called to consider its rules generally and in particular the effect of the Court's earlier judgment did not carry a proposal to add a new sub-para. (ii) to r.6(4). The-new sub-paragraph which had been 'proposed by the New South Wales Division reads: --/8.. "Provided that where the members of one or more Divisions of the union are employed in one Government Railway system the total membership so employed shall be deemed to be a Division within the Rules and entitled to representation on the Australian Council and Committee of Management 1n accordance with Rules 7 and 9." As stated the proposed rule alteration was declared lost the voting being in favour: N.S.W. 3; against Qld (2), Vic. (2), S.A. (1), Commonwealth (1), Tas (1), W.A. (1), General Secretary (1). Total against 9. Tuming then to the challenge to r.7(2} the principles governing the validity of the constitution of governing bodies of unions registered under the Act are now well established. Most of the authorities are set out in the earlier judgment and do not require to be repeated in these reasons. Whether or not any imbalance in the voting strength of the branches or divisions of organizations at meetings of the governing body of any particular organization falls outside the spectrum referred to in McLeish -v- Kane (1978) 36 F.L.R. 80 1s a question of fact. The question 1s not whether one can formulate in the abstract a more theoretically democratic structure.The relevant question 1s whether what the organization has constructed for itself 1s within the spectrum of permissable alternatives allowable by the Court. In my view emphasis must be given to what the organization decides in sorting out conflicting policy considerations as to an appropriate structure and if the organization provides for a structure which is within the legitimate range of possibilities allowable by the Court then it is nothing to the point to say that there 1s a theoretical proposal which creates a more highly democratic goveming body. In Luckman -v- Australian Postal and Telecommunications Union (1978) 36 F.L.R. 68 @ 72 Sweeney J. stated: "It 15 quite«clear that -1t 1s primarily for the members of an organization to decide on the form of its government and its rules. 'This however 1s subject to --/9.. -9- certain quite precise and specific provisions provided by the statute.". This view has been expressed by the Australian Industrial Court and by other members of the Court in other cases (e.g. McLeish ~v- Kane (supra.) @ 94). The respondent organization has stressed that it is pemmissable for the Court when calculating relevant percentages of votes held by the respective Divisions to exclude from the total number of votes that might be cast at any Council Meeting the votes of the officers where such officers are elected by the whole of the membership of the organization. In the present case this would mean that the voting percentage of New South Wales of 30.77% as set out in Table A above would increase to 33 1/3%. Although there is merit in this submission the Court in oonsidering the imbalance of the voting strength of Divisions on the Council has disregarded it and has approached the problem on the percentage bases as set out in Table A above. Further 1t 1s to be noted that in addition to liberalising the plebiscite rule by amending r.16 as set out above, the Australian Council at its meeting of 1 and 2 December 1982 also liberalised the provisions for the calling of a special meeting of the Australian Council. Prior to such amendment r.7(5) required a majority vote of members of the Council an order to call a special meeting of that Council. Now it 1s mandatory to call a special meeting of the Council at the request of "not less than one-third of the members of the Council". In the present case the applicant has not demonstrated that under the existing rules the will of the membership has been thwarted or democracy does not 1n practice prevail. Nor has it been shown that there has been any history of complaint except by the N.S.W. Division which Division has had --/10.. -10- its position expressly dealt with by the Australian Council by increasing its voting power on that body (see Cook -v- Crawford (1983) 43 A.L.R. 83 @ 108-9 and 163). In view of the amendments made to r.7(2), 1/7(5) and r.16 in December 1982 and certified by the Industrial Registrar on 13 December 1982 I am of the opinion that the challenge to the consitution of the Australian Council, namely r.7(2) should not succeed. This then leaves the challenge to the constitution of the Australian Committee of Management (r.9(1)). This rule is fully set out in the earlier judgment and has not been amended since the date of the earlier judgment. The applicant's challenge to this sub-rule was that as each Division is equally represented on the Commttee an imbalance of the voting strength of Divisions is clear. 'the total number of votes (excluding the General President who has a casting vote only) is 8 so that each Division hag a voting percentage of 12%% as compared with 1ts membership percentage as set out in Table A above. The Court 1n McLeish -v- Kane(supra.) @ 87 stated: "Rule 13 provides for a national executive. It is an administrative body which meets between meetings of the national council and which exercises its powers subject to the overriding control of national council. Any decision of the national executive may be held up and prevented from taking effect by the procedure provided 'under. r.20. A special meeting of the national council - Tay. be called by-the national secretary and president or as the national council or national executive may determine. The national executive is primarily an administrative body. It 1s necessary for it to be a small body that 1t may function and secondly it ./il.. -ll- seems clearly necessary that each branch should be represented on it. Having regard to the power in r.20 to ensure a moratorium in respect of any action and having regard to the overriding power of national council, we think r.13 1s not unreason- able, oppressive or unjust. It is true that smaller branches have the same voting power as do large branches but we think that taking into account its administrative functions, the need for such branch to be represented on it and the overriding powers of the national council r.13, having regard to the objects of the Act and the purposes of the registration of organizations under the Act, 1s not oppressive, unreasonable or unjust. " Again in Luckman -v- Australian Postal and Telecommumuications Union (supra.) @ 77 Sweeney J. stated: " Rule 9 deals with the federal executive. The cbyection taken was that, having regard to the composition of the body and its powers, there was not a proper measure of control of committees of the un1on by the members and that the rule imposed conditions which were unreasonable, oppressive and unjust. 'The amendment made to r.9 has taken out a provision that 1m most of its activites the federal executive should act as directed by a majority of branches. This has also altered the powers of the body. Looking generally at the body, I think 1t is now proper to consider 1t as primarily an administrative body. It is true that 1t is described as the governing body of the union from conference to conference, but admnistration is part of government and the subsequent phrase vesting in it the general management of the affairs of the union subject to the resolutions of conference and plebiscite decisions of the membership in the federal executive show the true nature of the body. There is now provision whereby the larger branches are more easily able to convene a special conference, and it seems to ma proper rule which places the administration in the hands of officers elected by the rank and file as well as an equal number of councillors elected, one from each branch. I have had regard to the decision of the court in McLeish -v— Kane (1978) 36 F.L.R. 80 @ 87." In the present case it is clear that the Committee of Management constituted by r.9 1s not a policy making body but is merely 'an admmistrative body. It-mst be remenbered that the total -menbership of the present organization is just over 12,000 members. Each Division has a voice on the Commttee. Such a Committee which has to deal with ~./12.. -12- day to day administration should not be burdened with the heavy expenses which would be incurred in calling regular meetings of an excessive number of members, some of whom would of necessity be required to travel very great distances. In view of the observation of the Court in Mcleish -v- Kane (supra.) and Luckman -v— Australian Postal and Teleconmmunications Union (supra.) in this regard and 1n view of the comparative ease under which a special meeting of the Australian Council mght be called in accordance with r.7(5) and/or the camparative ease under which a general plebiscite mght be asked for 1n accordance with r.16, I am of the view that the challenge to r.9(1) also fails. Accordingly the order nisi herein should be discharged. I certify that this and the 11 preceding pages are a true copy of the reasons for judgment herein of The Honourable Mr Justice Evatt. hb~, Mitnnto {ss8ciate Dated /9 Wir he (9B