CATCHWORODS INDUSTRIAL LAW - union rules - powers of Executive Council wide - whether composition of Executive Council oppressive, unreasonable s¢ unjust - undemocratic composition - all States equal in voting power - great disparity of numbers of members in various States. Conciliation and Arbitration Act 1904, ss.2(fT), 140 Conciliation and Arbitration Regulations, reg. 115(1)(d)(v) ERROL RAYMOND HODDER wv. THE AUSTRALIAN WORKERS' UNION QLD 95 OF 1985 PINCUS J. BRISBANE 2 AUGUST 1985 IN THE FEDERAL COURT OF AUSTRALIA ) QUEENSLAND DISTRICT REGISTRY ) QLD Q5 of 1985 INDUSTRIAL DIVISTON ) BETWEEN : ERPOL RAYMOND HODDER Applicant AND: THE AUSTRALIAN WORKERS' UNION Respondent MINUTES OF CRDER JUDGE MAKING ORDER: PINCUS J. DATE OF ORDER: 2 AUGUST 1985 WHERE MADE: BRISBANE THE COURT ORDERS THAT: The application be adjourned to a date to be fixed. NOTE: Settlement and entry of orders is dealt with 1n Order 36 of the Federal Court Rules. IN THE FEDERAL COURT OF AUSTRALIA ) QUEENSLAND DISTRICT REGISTRY ) QLD Q5 of 1985 INDUSTRIAL DIVISION ) BETWEEN : ERROL RAYMOND HODDER Applicant AND: THE AUSTRALIAN WORKERS' UNION Respondent PINCUS J. 2 AUGUST 1985 REASONS FOR JUDGMENT The applicant 1s the secretary of the Queensland Branch of the Australian Workers' Union and one of the national vice-presidents. He has obtained a rule that the Union show cause against the granting of orders under s.140 of the Conciliation and Arbitration Act 1904 declaring that Rule 36 of the Union's rules contravenes 5.140{1)(c) of the Act and other orders ancillary to that. Under Rule 36 there is an Executive Council, which I shall call simply "the Executive", which is composed of the president, six vice-presidents, the general secretary and six branch councillors; each holds office, subject to the possibility of prior removal, for four years. Each branch is represented by a vice-president anda branch councillor and that is the source of the applicant's complaint. He says that when one examines the rules it is seen that the Executive is such a body that its having two members from each branch conflicts with s.140(1)(c) of the Act. With qualifications mentioned below, each branch covers a State and the Union has many more members in some States, particularly Queensland, than in others, particularly Tasmania; the applicant says that it is unreasonable that an organ of the Union having such powers as the Executive has should be so undemocratically composed. Although the word "democracy" has been expropriated by institutions which . are totally unrepresentative of those whom they rule, the adjective from it, "democratic", still carries with it the implication that the body described is so composed as to be truly representative of those it purports to represent and it is in that sense that I use the word in this judgment. Mr Shaw 0.C., for the Union, could not claim that the Executive is notably democratic, as some members have nine times the representation of others, but urged upon me the view that it is merely an administrative body. If it were, I could see no strong objection to its composition. The core of the case is that it is not. Central bodies of national unions may have quite a range of powers granted to them under the rules, as the evidence in this case allustrates. The Executive of this Union has administrative functions, but its most important functions (which, as the evidence shows, it freely exercises) are not administrative at all but legislative. As will appear, I have reached the conclusion that in view of its functions the Executive is not properly constituted. What I have to say about its lack of conformity with s.140(1)(c) has no necessary application to any other organ of any other Union called "an executive", or some similar name. INTERPRETATION OF STATUTE Section 140(1})(c) of the Act requires that the rules of an organisation:- "shall not impose upon applicants for membership, or members, of the organization, conditions, obligations or restrictions which, having regard to the objects of this Act and the purposes of the registration of organizations umder this Act, are oppressive, unreasonable or unjust ..." Tn determining whether a cule is oppressive, unreasonable or unjust regard is to be had to "the objects of the Act" and "the purpose of the registration of organizations". The "objects of the Act" are derived from two sources: firstly, from 3.2 of the Act and, secondly, from a consideration of the provisions of the legislation" as a whole (Municipal Officers' Association v. Lancaster and Anor (1981) 37 A.L.R. 559 at pp.579. See also Wright v. Mcheod (1983) 51 A.L.R. 483 at p.489). However, identifying those objects and purposes is only a step towards resolving the question arising under s.140{1)(c), for it 1s clear that it is not enough, to survive attack under s.140(1)(c), that it be shown that the rules conform to such objects and purposes. In Cassidy v. Amalgamated Postal Workers' Union of Australia (1967) ll F.L.R. 124 at p.127, Dunphy and Kerr JJ. said:- ",.. the paramount duty of the court is to see whether a cule imposes upon applicants for membersnip or upon members conditions, obligations ox restrictions which are oppressive, unreasonable or unjust and in doing so it must bear in mind the objects of the Act and the purposes of the registration of organizations under the Act. The argument for che Union really amounted to the proposition that the court must do more than have regard to these last-mentioned matters. It must refrain from finding a rule invalid because of contravention of s.140(1) unless it can find that the rule offends because it imposes conditions, obligations or restrictions on apolicants foc membership or on members of such a kind that they are oppressive, unreasonable or unjust by reason of some operation adversely affecting or conflicting with the objects of the Act or the curposes of registration of organisations under the Act. This is not what the section means." This view is consistent with that taken by Evatt and Northrop JJ. in the Full Court in Wiseman v. Professional Radio and Electronics Institute of Australasia (1978) 20 A.L.R. 545 at p.555, which their Honours reconsidered and reaffirmed in Municipal Officers' Association of Australia v. Lancaster (1981) 37 A.L.R. 559 at pp.578-579. Their Honours held that an approach should be taken, in the exercise of the power conferred by s.140(1)(c) of the Act, similar to that mentioned in the High Court in R v. Hunt; ex parte Sean Investments Pty. Ltd. (1979) 25 A.L.R. 497, from which I deduce that the objects and purposes are a "fundamental element" in the making of a decision under s.140(1)(c). As to the meaning of the phrase "oppressive, unreasonable or unjust" I refer to Cameron v. Australian Workers' Union (1959) 2 F.L.R. 45 especially at pp.50-51 per Spicer C.J. and at pp.68-69 per Dunphy J.; assistance is also to he derived from the remarks of Deane J. in Municipal Officers' Association of Australia v. Lancaster (above) at pp.589-590. L In determining whether Rule 36 is contrary to the objects of the Act or the purpose of registration, and whether it is oppressive, unreasonable or unjust, "regard should be had to the structure and history of the organisation concerned": (Scott v. Rolf? (1979) 36 F.L.R. 249 at p.251), and, to the "whole of the organisation's rules, the method of electing committees, the committee members' tarcm of office and the power of a general meeting" (Wright v. McLeod (1983) 51 A.L.R. 483 at p.493). MEMBERSHIP The Australian Workers' Union is a federally registered organisation with six State branches. It was formed in February 1894, when the Australian Shearers Union (founded on 12 June 1886) amalgamated with the General Labourers' Union (founded in February 1891). By 1905 when several Queensland Unions amalgamated with the federal organisation, the Australian Ay Workers' Union was a united body over the whole continent" ("History of the Australian Workers' Union by W.G. Spence, 1911, p.110). In 1967 it joined the A.C.T.U. Presently it is the third largest union in Australia, with 106,417 members for the ticket year ending 31 July 1984. However, those members are not, of course, by any means evenly distributed. The membership of each of the branches for the ticket year ending 31 July 1984 was:- BRANCH MEMBERSHIP PROPORTION OF TOTAL MEMBERSHIP New South Wales 20,441 19.20% Victoria 17,654 16.58% Western Australia 16,450 15.45% South Australia 11,522 10.82% Queensland 36,144 33.96% Tasmania 4,206 3.95% TOTAL 106,417 99.96% Both sides argued the case on the assumption that conformity with 5.140 is not to be tested in the abstract, but against the background of fact. More specifically, the arguments assumed that 1n deciding whether the rules provide for enough democratic control of the Executive, the Court must have regard to the substantial differences between the number of members in the branches. It may not be immediately obvious that sucha construction accords with the wording of s.140. The provision in question, s.140(1)(c), does not require that the rules not operate in an oppressive, unreasonable or unjust way, in the circumstances as they exist from t1rme to time; on the face of it, the section contemplates that the rules will either be good or bad, not that they will slide by degrees from one condition to the other, as the circumstances to which they apply change. Nevertheless, I am of the view that the proper construction of s.40(l)(c) ais such that a rule may be just at one time. and become unjust. The justification for s0 construing 5.140(1)(c) is that for many vears the provision has been read in this way, although admittedly express statements that such a reading is permissible are not easy to find. A clear and fairly recent example of the Full Court's having taken into account, in sucha case as this, the then size of the Union's branches is Sherrif v. Townsend (1980) 48 F.L.R. 20: see especially at pp.28-29 per Smithers J. EXTENT OF THE EXECUTIVE'S POWERS Neither party to the litigation showed much interest in debating the extent of the Executive's powers, nor did either suggest that those powers are anything but perfectly reasonable. I am not obliged to go behind that, nor to enter upon an examination of the question whether the grant of such wide powers is un conformity with the Act. On the other hand, the extent of the powers is not a peripheral matter; it is, rather, central to consideration of the case. For if it is said that a particular organ of a registered organisation 1s constituted in a way which is in breach of s.140(1)(c), the first question must be what the powers of that organ are. The principal submission in the helpful argument of Mr Shaw Q.C. on behalf of the Union was that the Executive is under the Rules merely an administrative body, a proposition I reject. As was said in Burns v. Australian National University (19982) 40 A.L.R. 707 at p.713: "The word 'administrative' carries with it the notion of 'managing' 'executing' or 'carrying into effect'". The powers of the body here in question, despite its name, are not so confined. To some extent the argument before me proceeded on the assumption that it was the practical operation of the rules, as demonstrated by past experience, which had to be considered, rather than the operation of which they are capable. As an example of this approach, it was urged upon me that in considering the powers vested in the Executive by the cules, I should take unto account the fact that, currently at least, some matters decided by it are routinely submitted cto the next meeting of the Convention, for approval or confirmation. Evidence of that sort does not appear to me to have any bearing upon the matter I have to consider. Like the constitution of a nation, the rules of a Union, whatever their content, may from time to time be applied in a fair or unfair way. It 15 not their mode of application, as it may appear to the Court at the date ofa hearing, which s.140(1)(c) requires to be examined, but their true effect. However. a change in the extrinsic facts upon which a rule operates may make a once reasonable rule unreasonable, or vice versa. For example, the prescription of a particular composition for the Executive may become unreasonable because of changes in the distribution of the membership around the nation. Alterations in the attitude of members or officers towards the rules, or their assumptions as to the way in which they should operate, appear to me to be in a different category altogether. I cannot, for example, accept that proof that at a particular time the use of the wider powers of this Executive was rare could be relevant to the validity of the rules. Not only the wording of s.140(1){c), Dut practical considerations, weigh against that. As to the latter, experience shows that in times of crisis or internal dissension understandings as to the way in which the constitution of an organisation should be applied are likely to go by the board. Even absent such a situation, a future Executive might be disinclined to take notice of alleged conventional restraints on the exercise of its constitutional power. Under Rule 35 the Convention 15 to open annually in the month of January and to be constituted by the president, the general secretary and branch delegates. The system of election is proportionate, each branch being entitled to a delegate for the first 4,000 financial members and an additional delegate for each further 4,000 or part thereof. As I have mentioned, the Executive Council consists of the president, a general secretary, and a vice-president and councillor from each of the six branches, a total of 14 people. Rather curiously, the general secretary has an unlimited right to vote, but the president has not; the president has a casting vote only, except on questions submitted to the Executive (short) under Rule 39(i). That sub-rule entitles not less than two-thirds of the total members of the Executive, by writing, to exercise all the Executive's powers, but the resolution is not effective unless "a majority in 10. number of those entitled to vote as members of the Executive Council vote in favour". The words just quoted are to be contrasted with the expression "no fewer than two-thirds of the total membership of the Council" in Rule 39(b), mentioned below. The two representatives from each branch are elected by the members of the branch in question: Rules 47, 48. There is a branch for each State, except that the South Australian branch includes "Central Australia" and New South Wales includes the Australian Capital Territory, under Rule 37. The powers of the Convention are chiefly two, firstly to decide and direct the policy of the Union and secondly to make, amend and rescind the cules: 38(a) and (b). Regrettably, the relationship between these powers and chose of the Executive does not appear very clear, at least it does not appear so to me. One starts from the proposition that the Convention has power "to decide and direct the policy of the Union" in certain matters, being most of those likely to arise in practice. Next, the power of the Executive to manage the affairs of the Union is, under Rule 39(a) "subject to the direction of Convention". Presumably, such directions must relate to policy matters, for there is nothing in Rule 38 giving general power to the Convention to decide matters other than those of policy; the right to hear appeals, given by Rule 38(b), is plainly not intended to give such powers. Up to that point, then, 1t appears that the basic relationship between Convention and Executive is that the former may lay down policy, by which the latter must abide. il. However, Rule 39(b)(1) makes clear that the Executive need not abide by the Convention's declared policy at all; it may suspend 1t when necessary and without notice. In the end, the Convention's power to direct and decide policy and the expression "subject to the direction of Convention" in Rule 39(a) appear to be of no great consequence, for whatever policy the Convention decides may be suspended by the Executive. At first sight, then, as between the Convention and the Executive the latter 15 at least as 1mportant a legislative body. The Council has not, with some specified exceptions, power to give detailed directions with respect to the affairs of the Union; it can only decide policy and whatever policy 1t decides can be immediately suspended by the Executive. The only escape from this prima facie conclusion is to read the expression "subject to the direction of Convention" in Rule 39(a) as intended to imply a power in the Convention additional to that set out in Rule 38, namely general power to give directions as to Matters other than policy. So to construe Rule 39(a) would give no effect to the express limitation in Rule 38(a), confining the general powers of the Convention to matters of policy. It is because the general powers are so confined that Rules 38(c) to (e) expressly give the Convention power to make certain specific decisions, other than on matters of policy - for example, fixing the amount of contributions. It therefore must be concluded that although Rule 38 describes the Convention as the "highest deliberative body of the Union", the listed powers given to the Convention, when compared with the listed powers given to the Executive, pay scant respect to that general statement. It is ty 12. particularly important to emphasise that directions as to policy by the Convention are, under the rules, only effective until the Executive decides to suspend such policies, which may be done "where they deem it necessary and without notice", under Rule 39(b). The difference between suspending the policy and then acting contrary to it, on the one hand, and merely acting contrary to it sithout formally suspending it, is merely procedural. The substance of the matters 1s that the Executive is not bound by what the Council lays down as to policy and the real inhibition on its acting contrary to Convention policy is the requirement of a two-thirds affirmative vote. mentioned in more detail below. Apart from having the general management of the affairs of the Union, under Rule 39(a), and power to suspend Convention policy under Rule 39(b), the Executive Council's most significant powers are those included within Rule 39(b), which it is convenient here to set out in full:- "(b) The Executive Council, when Convention is not sitting, shall have power where they deem it necessary and without notice - (1) to suspend the policy laid down by Convention or any portion thereof; (2) to make such Rules and other provisions or to rescind or vary existing Rules as may be deemed expedient; (3) to impose levies upon members and Branches; (4) to fix salaries for Executive Officers; 13. (5) to give approval to Branch Executives to fix the salaries of Branch Secretaries, District Secretaries, Divisional Secretaries and Organisers. Provided that such approval shall only be given by the Executive Council in session. Provided that all acts done by virtue of paragraphs 1, 2 and 3 of this section (b) must be affirmed by no fewer than two-thirds of the total membership of the Council or it shall have no effect." Mr Shaw Q.C. drew attention to a possible uncertainty in meaning of the word "Rules" in Rule 39(b)}(2). He suggested that the power to make, rescind and vary rules, given by that provision to the Executive, may not be as wide as it seems at first sight. The heading of the whole document is "Constitution ' and General Rules of the Australian Workers' Union" and it is arguable that the Executive's power to change the rules does not extend to constitutional matters, such as the power of the Executive or that of the Convention. It is my view, however, that, in general, the word "Rules" in Rule 39(b)(2) includes all the rules, whether they may be described as constitutional or not. The question just mentioned was touched on in a decision of a Deputy Industrial Registrar given on 6 March 1985, relating to an application for consent to alteration of rules by this Union; the reasons there given are consistent with the conclusion I have stated. An exception to the universal rule-making power of the Executive is that, in my opinion, it cannot make rules fundamentally altering the structure of the Union, for example by abolishing the Convention. I derive this by implication from the 14. statement, referred to above, in Rule 38 that the Convention "shall be the highest deliberative body of the Union" and from an implication in the opening words of Rule 39(5b). Tt is not necessary to explore the scope of this implicit exception, for the purposes of these reasons, and I mention it merely for the sake of completeness. If I amwrong in thinking that the Executive cannot make a change in the rules such as to destroy or gravely weaken the position of the Convention, then my ultimate conclusion in the case is not vitiated - indeed, it is strengthened. Tt ais undesirable that I attempt finally to determine the ambit of the Executive's power over the rules, although the existence of that power is most important in determination of the case, because the point was hardly touched on in argument. A predecessor of Rule 39(b), ina rather less drastic form, was upheld by Dethridge C.J. in Anderson and Broad v. A.W.U. (1936) C.A.R. 592. The corresponding rule was then 36(b) which was much the same as the present rule 39(b)(1) and (2) except that it had an additional proviso reading as follows:- "Provided further that any rules or decisions or alterations of rules or of policy so made shall remain in force only until the next ensuing Convention." The rule was held to be neither tyrannical nor oppressive within is, the meaning of s.58D, the then counterpart of s.140. His Honour explained his reasons as follows:- "The powers given by this rule to the Executive Council where in the circumstances of this Union necessarily have to be given to some delegate or delegates. ecutive Councillors have to submit themselves for election by members every year, who thus may ultimately approve or disapprove." The deletion of the proviso quoted does not appear to make much substantial difference: if the Convention disapproves of a change in the rules which has been made by the Executive, it can change them back again. The applicant relied, as an example of the exercise of the powers of the Executive, on a series of incidents which occurred in 1982. The January Convention defeated a proposal for alteration of branch boundaries which was presented to it, and resolved that the matter be referred to the Executive Council for a report, to be presented to the 1983 Convention. The Executive did not do that, but determined the matter for itself and the 1983 Convention found itself confronted, not with a report which it might consider, but a fait accompli: the branch boundaries had simply been changed by the Executive. The submissions on that point, on behalf of the applicant, had a slightly indignant tone - inappropriately, as 1t seems to me. The Executive acted quite within its rights. There is nothing in the rules which obliged it to refrain from exercising the powers given it, simply because the Convention did not want 1t to exercise them. It is idle to vest wide powers in the Executive and then complain of the fact that the Executive uses them. Nor 1s there any room for 16. the intrusion of notions of conventional restraints upon the exercise of power, such as those which are said to apply to the exercise of vice-regal power conferred by the Federal Constitution. The evidence does not disclose the existence of any relevant customs inhibiting the exercise of the Executive's authority; 1f 1t did, the evidence would be irrelevant because the Court''s function under 5.140 1s to determine the validity of the rules, not the validity of their manner of application. That the Queensland branch lost substantial membership and revenue as a result of this Executive decision may seem to it unfair, but the only importance of the incident, for present purposes, is that ait illustcates the point which brings success to the applicant: the so-called Executive Council is not an executive in the traditional sense at all. I should add that the Executive has made many other changes to the rules; it has not regarded its powers as limited by any notion that it is subordinate to the \ Convention. VOTING IN THE EXECUTIVE It was argued by Mr Hartigan Q.C. on behalf of the applicant that the Executive could exercise its powers under pars. 1, 2 and 3 of Rule 39(b), and in particular the power to suspend policy and change the rules, with the support of representatives of less than half the membership. That is, Mr Hartigan Q.C. asserted that despite the reference to a two-thirds majority, these important steps can be taken against the will of most members of the Union. To determine the correctness or otherwise of this submission it is necessary to examine more 17. closely the rules as to executive voting. The proviso to Rule 39(b) uses the expression "total membership of the Council" and, if read literally, it would require that 10 members concur in a proposal under one of pars. 1, 2 or 3, to enable the Executive to pass, for example, an amendment of the rules. One must harbour the suspicion that the draftsman of the proviso forgot that the president has, in general, no deliberative vote. It is possible that there was an intention to require a majority of two-thirds of those voting. However, I do not think the expression can be read down as if it referred to two-thirds of those voting. One reason is that Rule 39(i) uses the expression "two-thirds of the total members of the Executive Council" in the same sentence as "a majority in number of those entitled to vote as members of the Executive Council", showing a consciousness of the difference between the two expressions. In 39(i), there is at present no point in a differentiation between the two expressions, because that sub-rule deals with matters as to which the president has a deliberative vote; perhaps, when Rule 39(1) was first inserted. he did not have such a vote. However that may be, the use of the two expressions in (i) makes it a little harder to read "total membership of the Council" in 39(b) as a reference to voting members only. 18. As has been mentioned, the president has, under Rule 36, a casting vote only at meetings of the Executive, but a deliberative vote under Rule 39(1). The expression "casting vote" in Rule 36 cannot refer to a vote whose effect is to add, to a number just under two-thirds of the Executive, the one vote necessary to pass a motion covered by the proviso to Rule 39(b). That is because a casting vote 15 one which breaks an equality of votes. It was suggested at the hearing that, on present figures, a two-thirds majority might be obtained with the support of members representing four only of the branches. On the view expressed above, that is not so. If eight of the branch representatives voted in favour, and the general secretary aiso supported the motion, there would be only nine members in favour, which is of course not two-thirds of 14. The four smallest branches cannot obtain a two-thirds majority with the support of the general secretary. To achieve that, they would need in addition, for example, the vote of a member from New South Wales. If one takes that New South Wales member as standing for half the branch membership, it could be said that the minimum support necessary for a two-thirds majority in the Executive is a number of members representing about 56.4% of the total membership of the Union. In considering the implications of the conclusion reached, namely that people representing, so to speak, about 56.4% of the members of the Union can control the exercise of all the Executive's power, it is important to keep in mind that such 19. a majority can make significant changes to the constitution, enhancing the power of the Executive and hence their own power. It is also desirable to keep in mind the provisions of Rule 39(1) referred to above, permitting not less than two-thirds of the Executive to exercise all its powers; it appears to have the result that the four numerically smaller branches could resolve an issue by letter without consulting the two larger branches, passing a resolution relating to it by a simple majority - the three smallest States (representing 30.22% of the membership) plus the general secretary. All of the powers of the Executive other than the policy-suspending, rule-changing, and levy-imposing powers (Rule 39(b) (1), (2) and (3)), can be exercised by a simple majority. Therefore, the representatives of less than one-third of the members of the Union, with the general sacretary's support, can vary or rescind industrial agreements subject to the Act (Rule 39(d)}) or direct a contribution be made by other branches for the benefit of head office or any branch (Rule 39(e)). More generally, they can manage the Union's affairs, in large matters as well as small. In my view, it is important ina matter such as this to try to decide in conformity with the trend of authority, not merely as to the broad principles established in the cases, but as to the results achieved, on the facts. In Willingale v. Australian Federated Union of Locomotive Enqinemen (1981) 62 F.L.R. 129 at p.132, as he had earlier done in Cook v. Crawford 20. (1981) 52 F.L.R. 1 at pp.19-20, Evatt J. emphasised that:- "The court in determining whether a rule or the rules of an organization contravene the Act in this regard has to consider whether there isa disparity between, on the one hand, the number of members attached to a particular branch expressed as a percentage of the total membership of the Organization and, on the other, the voting strength that branch expressed as a percentage of the total voting strength of members of the body entitled to vote." I have thought it worthwhile to review some of the cases in which this problem has arisen, in accordance with the approach mentioned by his Honour. In Luckman v. Australian Postal and Telecommunications Unzon (1978) 36 F.L.R. 68, J.B. Sweeney J. held that rules providing for fixed and equal representation of States at both the conference (two officers from each State) and the federal executive (one officer from each State) of the Australian Postal and Telecommunications Union were oppressive and unjust conditions (p.73). In that case a majority of the persons entitled to vote at the conference or the federal executive could be constituted by four States voting together. The four smallest States represented 35.04% of the members of the Union. The Full Court in McLeish v. Kane (1978) 36 F.L.R. 80 held that the then existing rules of the Electrical Trade Unions of Australia, which provided for limited proportionate representation on the National Council of the Union, were unreasonable. In that case it appeared that a majority was obtainable with the support of the four smallest branches, 21. comprising 36% of the membership. Subsequently the rules were amended and in that form received the approval of the Full Court (40 F.L.R. 462). As amended, the voting system was such that it was not possible to obtain a majority of the members of the national Council, considered as voting by States, with the support of only the four smallest States. Ie us a coincidence that a proportion of membership support similar to that here in question was necessary to obtain a majority aun the Union Councils whose composition was attacked in Sherriff v. Townsend (1980) 48 A.L.R. 20 and Willingale v. Australian Federated Union of Locomotive Enqinemen (1982) 62 F.L.R. 129. In the former case the Full Court, and in the latter Evatt J., held to be in contravention of s.141(1)(c) rules which gave a majority based on the votes of councillors representing respectively 30.97% and 29.75% of the membership. It ais not entirely clear from the reports precisely what functions the Councils in issue had, but no doubt they were entitled, like the Executive of this Union, to exercise powers of general government, changing rules and the like. I have derived assistance from consideration of the voting systems which attracted judicial interference in these cases. I have also, however, kept in mind exhortations in the cases to be cautious in exercising jurisdiction under s.140(1)(c) and not too readily to interfere with the structure the members have chosen. I must say that I have not found a_ general predisposition not to interfere to be a really useful tool in solving the particular problem placed before me. It is necessary 22. to keep in mind, equally, that the statute contemplates that the Court will perform its duty of ensuring that the challenged rules conform to law. When dealing with the rules here in issue, the submission that the Court should defer to the members' choice of the content of the rules appears to me particularly inapt, for three reasons. Firstly, as I have pointed out, the small and rather undemocratic body, the Executive, has just as much power to make rules as the larger, rather more representative body, the Convention; the evidence shows that it has in fact exercised that power, to re-create the very deficiency of which the applicant complains. Secondly, the distribution of power under these rules is not easy te assess, because of the relative obscurity of their language, in respects mentioned above; it appears to me unlikely that it is widely appreciated just how powerful the Executive is. Thirdly, there are over 100,000 members and the notion that they, or indeed any substantial portion of them, have brought about or even applied their minds to the situation before me is a little divorced from reality. OTHER SUBMISSTONS It was contended on behalf of the Union that the fact that, except during a brief interval, the Executive has always had this voting structure should dissuade me from hoiding it not to conform to the Act. For a number of reasons, that contention appears to me to have little weight. One of the most weighty of these is that the statutory provisions to which the rules must conform have by no means always had the same form. It is of course important that in 1973 the legislature added object (f) to 23. those set out in s.2 of the Act:- "To encourage the democratic control of organizations so registered and the full participation by members of such an organization in the affairs of the organization." The extent to which the applicant was entitled to use reg. 115(1)(2) as a weapon was debated at the hearing. Its effect is that rules must provide foc "the control of committees of the association and its branches by the members of the association and the members of the branches, respectively". In the end, it does not matter much, i1nmy view, whether in this case the applicant 15 entitled to succeed on the basis of that provision, or whether (on the other hand) it is merely entitled to have it considered in determining the objects and purposes mentioned in s.140(1)(c); un e1rther event, democratic control has to be there, for Parliament has made that requirement one of the chief objects of the Act. I note that when the issue was last considered, the Convention divided evenly, 15 all, and the question was resolved by the president's casting vote. It was also contended by Mr Shaw Q.C. that the context un which the relative lack of democracy occurred was helpful and he pointed to the possibility of obtaining the views of the members by plebiscite. Here, that contention rings rather hollow, in view of the considerable expense and trouble which would be involved in using that procedure as well as the fact that the rules do not oblige - the Union to take any notice of the result. Again, Mr Shaw Q.C. pointed to the circumstance that the members 1n the largest branches are, very largely, under State 24. awards rather than Federal awards. I have taken that into account, but in the end I do not think it is of much importance; 1t is clear, not only from the evidence but as a matter of general knowledge, that the federal activities of the Union are often of considerable importance to those under State awards. Mr Shaw Q.C. also said that if one were obliged or entitled to have regard to the way in which the rules might Operate, it would be necessary to notice that the Convention can be adjourned rather than terminated, so that it can continue to function during the year, inhibiting the exercise of the powers of the Executive. The provisions relevant to that submission are as follows. Firstly, Rule 35 says that the Convention "shall open annually in the month of January ...". That implies that it is an annual event, an implication reinforced by the terms of Rule 38(e), which gives the Convention power to fix the venue of the next Convention, but says nothing about the date on which it is to be held. Rule 41 requires that certain proposals for the Convention are to be forwarded not later than 1 December in each year; the whole of the proposals are to be arranged and printed as soon as practicable after that date. Again, 1t 1S an annual meeting which is contemplated. Further, it is by no means clear that proposals forwarded after 1 December but before the opening of the Convention may properly be considered at it. I deduce that the practice of not closing the Convention has arisen because it has been thought that the members of the Convention could be recalled, after the adjournment, to consider some important matter. Taking that theory to its logical conclusion, the Convention need never be closed, so that it may always be 25. recalled, presumably at short notice, to deal with an important matter such as re-establishing a policy which has been suspended by the Executive. It is not clear to me whether that view of the Convention's role, under the rules, is correct; I am inclined to doubt its correctness. However that may be, it seems clear that Rule 39(b), which gives the Executive its most important powers, operates only "when the Convention is not sitting". The word "sitting" means "actually meeting" and does not cover the case where the Convention is adjourned rather than formally determined. When regard is had to the fact that the Convention, as a larger body, is more expensive to call together and therefore likely to meet less often than does the Executive, the possibility of the Convention's having the right to resume meeting from time to time during the year does not seem of great significance. CONCLUSION The implication in the applicant's submissions was that democracy and democratic voting systems aré not singular but exist over a "spectrum" (cf. per Stephen J. in Attorney-General (Cth); (Ex. rel. McKinlay) v. Commonwealth of Australia (1975) 135 C.L.R. 12 at p.57) ranging from those which are almost non-democratic to those which are highly democratic. and that a concentration of powers ain elected bodies must narrow the spectrum since it makes less democratic systems unacceptable. By reference to the trend of what seem to me comparable authorities, I have arrived at the view that this Executive is not so composed as to satisfy the statute's requirements. If it matters, apart 26. from the cases my own view is that the Executive is not composed in a reasonably democratic way. I have attached particular importance to what the Full Court said in Australian Transport Officecs' Federation v. State Public Service Federation (1981) 34 A.L.R. 406 at p.411 about the central importance of the rule-making power; the Court held that it is "difficult to think of any subject matter more important in the affairs of an organization" than 1t. No doubt in some circumstances it may be practically desirable to permit a quick change in the rules, particularly concerning eligibility; however, the Executive's rule-making powers here are not so confined. Believing, as I do, that Rule 36 is not in conformity with the requirements of s.140(1)(c) of the Act, I have had some difficulty in determining how to proceed. I would propose to make a declaration to that effect, but am deterred by the circumstance that in some other cases the Court has deferred doing so, for the reason that such a declaration might throw into doubt the validity of what was being done, pending amendment of the Rules. I have therefore decided not to make any declaration until the parties have had an opportunity of considering these reasons and making submissions on them. It seems desirable, however, that I set out some views as to the way in which the deficiency in the rules may be remedied. Where one has an undemocratically composed organ of a Union to which the rules give very wide powers, the objection to that is not to the unrepresentative character of the body alone, or to the powers alone; it is the combination which infringes the 27. Act. To bring the rules into conformity with the Act, it is necessary either to reduce the powers of the Executive, or to make it more representative, or both. Neither side in the litigation before me showed any interest in the possibility of reducing the powers of the Executive. However, the Court is not confined, in 1ts consideration of the matter, to the attitudes they adopt. It appears to me desirable, and perhaps essential, that consideration of the remedy for the present situation should not be confined to the Executive, whose composition does not conform to the Act. It was suggested during the hearing by Mr Hartigan 9.C. for the applicant that there might be a reversion to the position which it obtained between 1967 and 1971, when there was a more democratic composition. In answer, 1t was argued that such composition would result in 19 members, too great a number. It is true that 19 would seem to be a large number to have on a body whose function was truly administrative. However, it should not be assumed that the only possible composition of the Executive is one under which the smallest branch has two members rather than one. If the result of preserving that assumption, while achieving more democratic control of the Executive, is too large a number of members, then 1t is the assumption which must go and not the democratic control. Mr Hartigan 9.C. did not by any means confine himself to the suggestion that the position should revert to that which obtained in I1971. He said, and I agree, that the problem is capable of a number of quite different solutions - i.e. solutions 28. other than a simple reversion to the 1971 position, which may not (and in my present view would not) provide a satisfactory Executive. Subject to submissions by counsel, I propose to adjourn the matter to adate to be fixed. That date is to be arranged between the parties and the Registrar, so that the matter is re-listed within six weeks; in default of agreement, the Registrar will fix the date himself. ' cerufy thar this and the 27] preced n3 Pages ara a true copy of the reasons for judgment herein of His Honour Mr Justice Pincus Darvrce rd) Ri od {9 /QS" Associate 2/8) : a ee aew ee