Ino £ CATCHWORDS Industrial law - registered organization - rules - validity - imbalance in sub-branch representation or branch committee of management = whether particular rule or rules as a whole contravened Act - consequences of different orders - whether rules provided adequately for control of branch committee of management by members of branch. Conciliation and Arbitration Act 1904 ss. 133(1)(db), (1)(f), 133AA, 140(1)(5G)(6)(7)(8)(9), Part IXA. Conciliation and Arbitration Regulations reg. 115(1)(d)(v), 115(2) ROBERT WILLIAM LAWLEY, JOHN CHARLES LEATHERBARROW, BARRY MICHAEL JAMES NEWION and JOHN MICHAEL RIETHMULLER Vv. TRANSPORT WORKERS' UNION OF AUSTRALIA we ee eee : ' yf eee No. 93 of 1987 Gray J. MELBOURNE 18TH SEPTEMBER 1987 mie ee een) IN THE FEDERAL COURT OF AUSTRALIA ) ) QUEENSLAND DISTRICT REGISTRY ) No. Q3 of 1987 ) ) INDUSTRIAL DIVISION OQ iobe] ROBERT WILLIAM LAWLEY, JOHN CHARLES LEATHERBARROW, BARRY MICHAEL JAMES NEWTON and JOHN MICHAEL RIETHMULLER Applicants -and- TRANSPORT WORKERS' UNION OF AUSTRALIA Respondent MINUTES OF ORDER Gray Jd. 18th September 1987 PLACE : Melbourne THE COURT ORDERS AND DECLARES : The rules of the respondent, the Transport Workers' Union of Australia, contravene section 140(1) of the Conciliation and Arbitration Act 1904 in a specified respect, namely that they fail to make a provision required by regulation 115(1)(d)(v) of the Conciliation and Arbitration Requiations, in that they fail to provide adequately for the control of the Queensland Branch Committee of Management by members of the Queensland Branch. wegen oe fe tee teen ee ee mee ee ee ee ee cee ee Loy sme fy A seer Op a wee, ore eS cite ? ' ar Ve SLT ee ene mary Se eatacinaisennat ane nkatert acer aeninad 2. Otherwise, the Rule to Show Cause is discharged. (NOTE: Settlement and entry of orders is dealt with by 0.36 of the Federal Court Rules.) ene ee py on oe mn ne eerie oe eee tee me 3 Py z > eee eT " 2 oe .: ahaet. -w om ene on ae oe ee IN THE FEDERAL COURT OF AUSTRALIA ) ) QUEENSLAND DISTRICT REGISTRY ) No.Q3 of 1987 ) INDUSTRIAL DIVISION ) ROBERT WILLIAM LAWLEY, JOHN CHARLES LEATHERBARROW, BARRY MICHAEL JAMES NEWTON and JOHN MICHAEL RIETHMULLER Applicants -and- TRANSPORT WORKERS' UNION OF AUSTRALIA , Respondent REASONS FOR JUDGMENT: JUDGE: GRAY J. DATE: 18th September 1987 On 15th May 1987, a Rule to Show Cause was granted to the applicants, who seek orders pursuant to s.140 of the Conciliation and Arbitration Act 1904 ("the Act"). The respondent, the Transport Workers' Union of Australia, is an organization of employees registered pursuant to the Act. Each of the applicants is a a member of the respondent. The respondent has a branch in Queensland, known as the Queensland Branch. That branch is divided into sub-branches, of which there are nine, known respectively as the Brisbane, Rockhampton, Wide Bay, Toowoomba, Warwick, Roma, Ipswich, Kingaroy and North Queensland sub-branches. To the extent to which they are relevant, the provisions of rule 30(a) and (b) of the rules of the respondent are as follows: omen nt ge te wee ge po So re ee ne eee sen epee mere agree ogee "(a) (b) Fach Branch shall in accordance with these Rules elect a Committee of Management to be known as the Branch Committee of Management which shall, subject to these Rules, have control of all business of the Union within the area over which it is constituted to operate. Fach Branch Committee of Management shall consist of a Branch President, Branch Vice-President, Branch Secretary, two Trustees and not less than seven and not more than eleven Committeemen. The President, Vice-President, Secretary, Trustees and -- in Branches which are not divided into Sub-Branches - the Committeemen mentioned in (a) hereof, shall be elected by a ballot of the whole of the members of the Branch who are eligible to vote. In Branches which are divided into Sub-Branches, the said Committeemen shall be elected by a ballot of the members of their respective Sub-Branches who are eligible to vote, on the following basis: Queensland: Brisbane - four; Rockhampton and Wide Bay - one each, Toowoomba, Warwick and Roma - one; Ipswich and Kingaroy - one; Northern Queensland - one. Notwithstanding anything contained in this Rule, should a member of the Committee of Management be unable to be in attendance at a meeting of the Committee of Management, the Sub-Branch of which the Committeeman is a representative may elect a proxy Committeeman to attend such Committee of Management meeting to watch the interests of the Sub-Branch he so represents. " eee a = Won Te ren ot tee ne a ee a re er cera Sn se ae 3. The only other branch for which provision is made for representation of sub-branches on the branch committee of management is the Victorian Branch. In its amended form, the Rule to Show Cause calls upon the respondent to show cause why an order should not be made declaring that: "]. Subrule (b) of Rule 30 of the certified rules of the Transport Workers' Union of Australia, at least insofar as the said subrule prescribes representation for the Brisbane sub-Branch on the Queensland Branch Committee of Management, contravenes Section 140(1) of the Conciliation and Arbitration Act 1904. 2. The Rules of the Transport Workers' Union of Australia fail to make a provision required by Regulation 115(1)(d)(v) of the Conciliation and Arbitration Regulations in that they fail to provide adequately for the control of the Queensland Branch Committee of Management by members of the Queensland Branch. 3. The Rules of the Transport Workers' Union of Australia contravene Section 140(1)(c¢) of the Conciliation and Arbitration Act 1904 by imposing on members of the Brisbane Sub-Branch conditions, obligations, or restrictions which, having regard to the objects of the Act and the purposes of the registration of organisations under the Act, are oppressive, unreasonable, or unjust in that they provide for a Queensland Branch Committee of Management on which Sub-Branches are represented without providing for adequate representation or voting power thereon of the Brisbane Sub-Branch." a , . 4. It may be seen that the essence of the applicants' complaint is that the application of the rules results in an imbalance between the number of members attached to the Brisbane sub-branch, compared with the number of members attached to other sub-branches, and the representation of the Brisbane sub-branch on the branch committee of management, and that that imbalance is not redressed adequately by other checks and balances in the rules. No precise evidence exists of the number of members in the various sub-branches. Figures were given, arising from the compilation of an electoral roll for elections in the Queensland branch, which took place in late 1985 and early 1986. There was also evidence from Mr. Ward, the Branch Secretary/Treasurer of the Queensland Branch, to the effect that there have not been significant changes in the proportions of members in the various sub-branches since early 1986. The figures which arose from the compilation of the roll do not make it easy to determine the precise numbers in the various sub-branches, even at that time. In the end, I have chosen a compilation made by the returning officer, Mr. Hodge, on or about 21st January 1986. This is the only compilation which shows a figure for each branch at any one time. Certain deletions were made from the electoral roll after the compilation on which I have relied, 30 that the numbers compiled do not tally with the numbers of ballot papers finally issued. After 21st January, however, there are no separate compilations for the sub-branches in which ballots were not conducted. It is reasonable to assume that ew emma, ay ce the deletions which occurred after the compilation were roughly uniform across all sub-branches, and therefore to assume that the figures in the compilation will indicate a reasonably accurate comparison between the various sub-branches. In compiling the figures, I have shown separately members said to reside in or about Charleville, which is not a sub-branch. Some attempt was made on behalf of the respondent to obtain evidence that the Charleville members were to he treated as part of the Roma sub-branch, but the evidence does not go so far as to establish this proposition. The resulting figures are. shown in the following table, which sets out the numbers of members in the various sub-branches, and the number of Charleville members, the percentage of the branch membership involved in each case, the numbers of positions on the committee, and the percentage of voting power on the committee of management which results. No.of % of branch Positions % of members membership on voting committee power Brisbane sub-branch 8171 66.58 4 28.57 Rockhampton sub- branch 353 7.77 1 7.14 Wide Bay sub-branch 711 5.79 1 7.14 Toowoomba sub-branch 724 ) Warwick sub-branch 230 ) 8.34 1 7.14 Roma sub-branch 69 ) Ipswich sub-branch 526 ) 5.27 1 7.14 Kingaroy sub-branch 121 ) North Queensland sub-branch 725 5.90 1 7.14 Charleville CUT ae we . members 43 0.35 - - Branch President - - 1 7.14 Branch Vice- President - - 1 7.14 Branch Secretary - - 1 7.14 Branch Trustee - - 1 7.14 Branch Trustee = = i 7.14 12273 100.00 14 99.97 As part of their case, the applicants attempted to rely upon evidence of occasions on which the views of the four Brisbane sub-branch committeemen have not prevailed in the branch committee of management, and of ways in which it was alleged that the branch committee of management has acted contrary to the wishes of the Brisbane sub-branch, in matters affecting the Brisbane sub-branch. Mr. Kenzie Q.C., who appeared with Mr. Amerena for the respondent, objected to this evidence. In turn, Mr. Kenzie sought to rely upon evidence to the effect that for some years most of the persons who have held the offices of President, Vice-President, Secretary and Trustee in the Queensland Branch have been members of the Brisbane sub-branch. Mr. Shaw Q.C., who appeared with Mr. Jerrard for the applicants, objected to this evidence. Each objection was upheld. When the Court is considering the application of s.140 of the Act, it cannot base its decision on the results of divisions, be they political, factional or other, in the organization concerned at any particular time. It is no more legitimate for the applicants to rely upon the fact that their sub-branch has not had its way on the branch committee of wee eee See ere 3 a a : management in certain instances than it would be for the respondent to defend the rules by showing that the branch committee of management had a history of co-operation with the sub-branch's point of view. The validity of the rules does not depend upon the attitudes of persons holding positions from time to time. This point was made with great effect in Hodder Vv. Australian Workers' Union (1985) 9 F.C.R. 498, at p. 502, where Pincus J. said: "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 rules, I should take into account the fact that, currently at least, some matters decided by it are routinely submitted to 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 is not their mode of application, as it may appear to the court at the date of a 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 rr re sete trees oe a ae yh / hoo. ae nn Panne pe ree ere nr pe ees ' 1 ae ye 8. powers of this Executive was rare could be relevant to the validity of the rules. Not only the wording of s 140(1)(c), but 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 organization should be applied are likely to go by the board. Even absent such a situation, a future Executive might he disinclined to take notice of alleged conventional restraints on the exercise of its constitutional power." Mr. Kenzie drew attention to Scott Vv. Rolfe (1979) 36 F.L.R. 249, at p. 253, where it appeared that J.B. Sweeney J. took into account that certain federal officers of the organization there under consideration had for many years been members of a particular branch. His Honour was considering whether the imbalance which existed between the membership of the largest branch and its voting power on the federal conference of the organization was too great. It is true that his Honour does appear to have taken into account the branch membership of the officers concerned, but no objection seems to have been taken to his doing so, and the question of the admissibility of such evidence is not discussed in his Honour's reasons for judgment. I cannot regard Scott v. Rolfe as authority for the proposition that the practical operation of the rules must be taken into account. I prefer the view of Pincus J. in Hodder Vv. Australian Workers' Union that the question is one of the validity of the rules, having regard to the structure of the organization concerned, but leaving out of account the attitudes of particular holders of offices, so that the validity of the rules does not depend upon a change in such attitudes. The applicants called in aid the principles which emerge from McLeish Vv. Kane (1978) 36 F.L.R. 80 and similar cases. Those cases concerned questions of imbalance between the membership of various branches and the extent of their representation on national governing bodies in various organizations. As Evatt J. said, in Cook Vv. Crawford (1981) 52 F.L.R. 1, at p. 20, with reference to such cases: "...the court in determining whether a rule or the rules of an organization contravene the Act in this regard has to consider whether there is a 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 of that branch expressed as a percentage of the total voting strength of members of the body entitled to vote. If such a disparity exists which is too great or too uneven then it may be said that the voting strength of particular branches may be outside the spectrum referred to in those cases and so render a particular rule or the rules of that organization invalid as being contrary to the provision of Es.1401". There has not yet been a case in which it has been contended that s.140 of the Act can be brought into play with respect to the representation of members on decision making bodies within an organization, other than those at the national level. Mr. Kenzie contended that the principles which emerge from McLeish ov. Kane are inapplicable to a branch Pa are nose Nhe ow TO te I pe ener cen ne nen res 10. committee of management. He argued that, in their nature, such principles are only appropriate for national decision making bodies. Alternatively, he drew attention to the non- application of the McLeish v. Kane principles to a decision making body which is "primarily an administrative body" (see McLeish v. Kane at p. 87 and Luckman v. Australian Postal and Telecommunications Union (1978) 36 F.L.R. 68, at p. 77) or "not a policy making body but...merely an administrative body" (see Willingale v. Australian Federated Union of Locomotive Enginemen (1983) 68 F.L.R. 149, at p. 156). In each of those cases the decision making body concerned was an executive body at the national level, the decisions of which were subject to the control of a more broadly representative council or conference. Mr. Kenzie drew attention to the predominantly administrative nature of a branch of the respondent, and to the extent to which it may be controlled by the respondent's federal council under the rules. It is a mistake to treat the principles laid down in McLeish Vv. Kane as if they are some sort of quasi-statutory code, with which all organizations must comply. Ultimately, the question is and must remain whether there is a contravention of s.140 of the Act. This must be the case, whether the rules concerned are applicable to a branch of an organization, or to the organization as a whole. If the rules relating to a branch provided that some arbitrarily selected group of members of the branch should be entitled to exercise voting power grossly disproportionate to their numbers in the branch, in the election of a committee Spree meee pene warren meee as go ee ater 11. of management of the branch, there would be an imposition of conditions, obligations or restrictions, which were oppressive, unreasonable or unjust, within the meaning of s.140(1)(c). This is so whether or not the branch committee of management exercises policy making as well as administrative functions. The principles laid down in McLeish v. Kane do indicate that, in the application of s.140, the law does not require in all cases precise conformity between numerical strength and voting power of different divisions within an organization; there is room for the imposition of checks and balances, to ensure that the will of a numerically superior section of the membership does not always prevail over the wishes of smaller divisions. In determining the extent to which departure from the ideal of one vote one: value is permissible in a particular organization, without there being a transgression of s.140, one of the factors at which the Court will look is the nature of the representative body whose constitution is being examined, and the functions which are committed to that body by the rules of the organization concerned. It cannot be said, therefore, that the Court cannot examine the rules governing the Queensland Branch of the respondent, for the purpose of determining whether there is a contravention of s.140 arising from the composition of the branch committee of management. In making such an examination, however, it is appropriate to bear in mind that what is being dealt with is a branch committee of management, and to look at the functions which it performs under the rules. Seen Tied roceaes ee ries ere nner . roe tee y " 4 " 12. The provisions of s.140 of the Act with which this proceeding is concerned are as follows: "140(1) The rules of an organization - (a) shall not be contrary to, or fail to ; make a provision required by, a - provision of this Act, the regulations or an award or otherwise be contrary to a law; (c) 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 under this Act, are oppressive, unreasonable or unjust; An examination of s.140 discloses that different kinds of orders may be made under these provisions. If it is possible to find a particular rule which is contrary to the Act, the Regulations, an award or a law, or which imposes conditions, obligations or restrictions of a kind proscribed by paragraph (c), then the appropriate order is a declaration that the whole or part of the particular rule contravenes sub-s.(1). The consequence of such an order is that the rule or part of the rule the subject of the order "shall be deemed to be void from the date of the order" by virtue of sub-s.(5G). Acts which depended for their validity on the rule or part of a rule the subject of such a declaration are themselves void and of no effect, unless validated by or under Pt. IXA of the Act. Alternatively, the Court may give a declaration relating 7 ra arr wn noes 13. to the rules as a whole, rather than toa specific rule or part of a rule. Such an order may declare that the rules as a whole are contrary to the Act, the Regulations, an award or a law, or impose conditions, obligations or restrictions of a kind proscribed by paragraph (c). On the other hand, such an order may declare that the rules fail to make a provision required by the Act, the Regulations or an award. In the case of a declaration as to the whole of the rules, whether such declaration is as to a contravention or a failure to make provision, no particular rule is void or deemed to he void; instead, the machinery exists under sub-ss.(7), (8) and (9) for the rules to be amended so as to bring them into conformity with the requirements of sub-s.{1l). Because no rule is void, acts done under the authority of the rules are valid. See generally R. v. Dunphy; Ex parte Maynes (1978) 139 C.L.R. 482, at pp. 489-490, per Mason J. with whom Barwick C.J. and Stephen and Aickin JJ. agreed, Morris Ve Federated Liquor and Allied Industries Employees Union of Australia (1978) 35 F.L.R. 60, at pp. 66-70, Boland Vv. Munro (1980) 48 F.L.R. 66, at pp. 76-77, per Evatt and Northrop JJ.,Wright v. McLeod (1983) 74 F.L.R. 146, at pp. 170-173, per Evatt and Northrop JJd., Krantz v. Federated Clerks Union of Australia (1986) 14 I.R. 357, at pp. 359-360 and Linehan v. Transport Workers' Union of Australia (1981) 76 F.L.R. 328, at pp. 332-333. In the present case, the Rule to Show Cause in its amended form seeks an order of each of the kinds to which I have referred. It is alleged that rule 30(b) of the ery ttt ae oe wee ee 14. respondent's rules contravenes s.140(1), that the rules fail to make a provision required by reg.115(1)(d)(v) of the Conciliation and Arbitration Regulations, and that the rules as a whole contravene s.140(1)(c) in a specified respect, namely that they provide for a Queensland Branch committee of management on which sub-branches are represented, without providing for adequate representation or voting power thereon of the Brisbane sub-branch. The authorities do not make clear the nature of the proper order to be made in a case where too great an imbalance exists in the representation of various branches on a national decision making body. In Sherrif v. Townsend (1980) 48 F.L.R. 20, specified rules of the organization the subject of that proceeding where challenged under s.140(1)(c), on the ground that they provided for equal representation on the federal council of branches with markedly unequal membership. At p. 29, Smithers J. contented himself with saying, "...it is apparent that the equal branch representation of the very unequal branches contravenes s.140(1)(c) of the Act." At p. 44, Evatt J. concluded that there was an imbalance in the voting power of the branches and that such imbalance fell outside the spectrum referred to in McLeish v. Kane and continued "...accordingly, in my view, both rule 1(b)(i) and 4{a) in this regard contravene s.140(1){c). I agree with the reasons of Northrop J. that the whole of the rule is contrary to s.140(1)(c) in this regard." At p. 51, Northrop J. concluded that "...rule 1(b)(1) of the rules of the federation contravene s.140(1)(c) i ot Nee mek fs a. A a ee nr een a A A i pn pn ardent in grrr wp 15. of the Act." His Honour then went on to treat the offending rule as if it were struck out of the rules, which resulted in each branch having only its branch secretary representing its members on the federal council, and having equal voting power. If the rule by which the branch secretaries were members of the federal council were then struck out on the same grounds, the federal council would be composed only of the federal secretary and assistant federal secretary, and the rules would therefore fail to make a provision required by the Act and the Regulations, namely a provision for the election of a committee of management of the organization. In the result, the Court declared that the rules of the organization concerned contravened s.140(1) in that they failed to make a provision required by the Act and the Regulations, namely a provision for a federal committee of management. Thus, it appears that all of the members of the Court treated the attack as being on the provisions of the individual rule which provided for equal numbers of representatives of the branches on the federal council, but the ultimate order made was a declaration with respect to the whole of the rules, that they failed to make a _ required provision. In McLeish v. Kane itself, there were two provisions of the rules of the subject organization relevant to the present discussion. One provision constituted a national council, consisting of a general secretary (elected by the whole of the members of the organization) and delegates elected by the branches, the number of delegates ee ee ee een an va . wo Ser ee noe ° ' : 16. being dependent upon the number of members in the branch concerned. A further provision entitled the delegates to exercise votes according to the numbers of members in their respective branches, on a sliding scale. The Court took the view that the result of the application of the sliding scale was to give to some branches too much and to other branches too little voting power on the national council. In the judgment of the Full Court, at p. 82, it is made clear that the challenge was to the specific rules concerned, under both Paragraphs (a) and (c) of s.140(1) of the Act. Nevertheless, when it came to discussing the challenge under paragraph (c), at p. 89, the Court said, "...the third ground taken is that the rules impose upon members conditions, obligations and restrictions which having regard to the objects of the Act are oppressive, unreasonable or unjust." (Emphasis added). In the result, the Court made an order adjourning the proceeding pursuant to s.140(6) of the Act, in order to give the organization an opportunity to alter its rules. Subsequently, in McLeish Vv. Kane (No.2) (1979) 41 F.L.R. 152, the same Full Court ordered the members of that national council to adopt new rules which had been the subject of a plebiscite of members. If the reasoning of Northrop J. in Sherrif Vv. Townsend had been applied in McLeish v. Kane, the result would have been the striking out of the provisions of the rule providing for a sliding scale of voting power. That would have left the provisions of the rule as to the number of delegates from each branch on the national council. The ant ppeananants Dem ema Wy ee. wee poe ' . er pe 17. result would have been an even greater imbalance, necessitating the striking out of that rule. The consequence would have been that no national council existed, under the rules of the organization, and an adjournment to permit the organization to alter its rules would have been futile. So also would have been the order in McLeish v. Kane (No.2). The order of the Full Court in McLeish Vv. Kane and the subsequent order are therefore consistent with a finding that the defect in the rules was a defect in the rules as a whole, and not a defect in a specific rule or specific rules. It is interesting to note that in Cook Vv. Crawford (1982) 62 F.L.R. 34, the members of the Full Court seem to have considered that a challenge based on the McLeish v. Kane principles was a challenge to a specific rule. See the judgment of Smithers Jd. (with whom Sheppard J. expressed agreement on this point) at p. 62, and the judgment of Keely dg. at p. 77. If examination of the rules of an organization were to be confined to a specific rule, such as that found in Sherrif v. Townsend, providing for equal numbers of delegates from unequal branches on a federal council, it would be impossible to say whether a challenge based on s.140(1)(a) or (c) could succeed. Speaking generally, the Act does not concern itself with the numbers of persons who make up a national decision making body. The specific rule may be good or bad, depending upon the existence or non- existence of other provisions of the rules. For instance, mre grr ee > ar: 18. there may be a separate rule providing for the exercise by the equal numbers of delegates of unequal numbers of votes, in accordance with the relative numbers of members in the respective branches. Such a provision would satisfy the requirements of the Act, according to the principles in McLeish v. Kane. Alternatively, as was the case in Cook Vv. Crawford, there may be a provision of another rule rendering the decision of the federal council subject to being overturned by a plebiscite of all the members of the organization concerned, such a plebiscite being relatively easily obtainable by members dissatisfied with a decision of the federal council. From this it may be concluded that any defect in the rules lies not in the specific rule constituting the national decision making body as a group of persons, but in the absence of any other rule requiring that their voting power bear the requisite relationship to the membership of the branches which they represent, or providing some other safeguard. Such a provision is not required directly by the Act, the Regulations or an award (except to the extent to which a challenge might be based on reg.115(1)(d)(v)) but is a requirement arising from the fact that the rules have imposed on the members of the organization conditions or restrictions, namely that they surrender their decision making power to the national governing body, and that such conditions or restrictions are required not to be oppressive, unreasonable or unjust. It is therefore the rules as a whole which impose such objectional conditions or restrictions, by setting up a national decision making body composed ina particular way but by not adding wre aa 19. some other provision, such as welghted voting or an easily obtainable plebiscite, to ameliorate the effect of the condition or restriction. To illustrate this proposition, it can be said that if the rules of the organization considered in Sherrif ev. Townsend had contained a provision for a scale of voting power on the federal council, with the number of votes exercised by each branch's representatives being precisely in accordance with the relative size of that branch, there could have been no objection whatever to the provisions of the rule which was held by the Court to have been in contravention. In my view, therefore, a case such as the present, so far as it depends upon s.140(1)(c), involves a challenge to the rules of the organization concerned as a whole, upon the footing that they impose conditions, obligations or restrictions which, having regard to the objects of the Act and the purposes of the registration of organizations under the Act, are oppressive, unreasonable or unjust. This conclusion is consistent with the orders made in McLeish Vv. Kane and McLeish v. Kane (No.2). It follows that, in 'the present case, whatever view is taken of the appropriateness of the composition of the Queensland branch committee of management, and the distribution of voting power on it, it would not be appropriate to make an order of the kind sought in paragraph 1 of the amended Rule to Show Cause. The question whether the rules of an organization contravene s.140(1)(c) because of an imbalance in the _ nn a NTE A RN 20. representation of sections of its members on a governing body is one of degree. In McLeish v. Faure (1979) 40 F.L.R. 462, at p. 476, the Full Court spoke of "...the spectrum over which rules dealing with the weighting of the voting power at meetings of branch delegates to or members of federal bodies of organizations might validly range". The notion of a spectrum involves the existence of some difficulty in discerning where the end of the spectrum lies, the existence of an indistinct line between what is on and what is off the spectrum. Nevertheless, it is clear from the use of the word "spectrum" that organizations are not expected to achieve perfection in the equality of representation of sections of their membership. They are permitted to take into account factors other than equality of representation, especially when there may be a perceived need to ensure that the voices of members belonging to smaller sections may be heard. The position in the present case is complicated by the fact that rule 30(b) provides that five officers, elected by the whole of the membership of the branch, shall he members of the branch committee of management. The committee of management is therefore made up of five officers, four committeemen from the Brisbane sub-branch, and five committeemen from single smaller sub-branches, or groups of smaller sub-branches. This makes a total of fourteen. Rule 48(7) provides that only one vote shall be exercised by those entitled to vote, unless otherwise provided in the rules; there is no relevant provision for weighted voting. Under rule 48(6), decisions are to be taken by a simple majority of ee ce reper 21. votes cast by those present. There Is no provision for a casting vote by the person chairing the meeting; a tied vote will mean that a motion is defeated. Assuming that all of the members of the committee of management are present, eight votes out of the fourteen will be required to pass a resolution. If voting is on sub-branch lines, with the Brisbane sub-branch pitted against the others, the Brisbane sub-branch will need the support of four officers to have a motion which it supports passed, or three officers to defeat a motion sponsored by the smaller sub-branches. The fundamental point of Mr. Shaw's argument was that the members of the Brisbane sub-branch, who constitute almost two thirds of the membership of the branch, are entitled to only 28.5% of the voting power on the branch committee of management. This argument leaves out of account the significance of the five officers. Inno case involving the application of the McLeish v. Kane principles has there been involved a decision making body with so many members elected by the whole of the membership of the organization concerned. At the most, the cases have dealt with decision making bodies of which one or two persons elected by the whole of the membership have been voting members. In each case, the voting power of such officers has been taken into account in assessing the extent of representation of the branches, notwithstanding the suggestion of Evatt J. in Willingale v. Australian Federated Union of Locomotive Enginemen (1983) 68 F.L.R. 149, at p.154 that there was some merit in the suggestion that the voting power of an officer prope ne ene eee 7 ~" — A re Aa a MAF a FO 22. elected by the whole membership should be ignored. See McLeish v. Kane at p.88 and Sherriff v. Townsend at pp.40 and 50-51. It is difficult to see how, in assessing the voting power of branch representatives, the voting power of members of a decision making body who are not branch representatives can be ignored. Mr. Shaw argued that imbalance in voting power between sections of the membership can only be justified on the basis of the existence of other democratic safeguards, whereby the will of the majority will prevail in certain circumstances, or the preservation of the viability of the organization. There is no doubt that, in applying the principles laid down in McLeish v. Kane, the Court has looked at the rules as a whole to see to what extent the results of the imbalance in voting power may be corrected by action on the part of the members whose wishes are thwarted. The Court has also looked at the viability of the organizations concerned, in the sense that an organization may tend to lose members or sections of members if their views are liable to be swamped constantly by the views of members in larger sections. To speak in terms of imbalance being "justified" by these factors, however, may be misleading. As was pointed out in Doyle v. Australian Workers' Union (1986) 68 A.L.R. 591 at pp. 599-600, the primary justification for a provision in the rules of an organization is that the organization has chosen to adopt it. The onus lies on an applicant for orders under s.140 to make out the defect in a rule or the rules. Ina case such as the eae ee ee seen seg ee qo oe 23. present, an applicant must show that the imbalance is too great, notwithstanding any countervailing factors, in order to succeed. The major democratic safeguard to be found in the rules of the respondent with respect to the Queensland branch committee of management is the presence on that committee of five officers, all elected by the whole of the membership of the branch. Since the Brisbane sub-branch has approximately two thirds of those members, the elected officers would be unwise to ignore for long any expression of a united view of the Brisbane sub-branch members. It is true, as Mr. Shaw pointed out, that the officers are not in any sense representatives of the Brisbane sub-branch. They are not elected to watch the interests of the Brisbane sub-branch, in the same way as the sub-branch committeemen themselves. Nevertheless, they are bound to be influenced profoundly by the views of the majority of members. In this sense, the capacity of members of the Brisbane sub~branch to have their united view adopted by the branch committee of management is considerable. In addition, it is plain from an examination of rule 30(b) of the respondent's rules that a decision has been taken that smaller sub-branches of the Queensland branch should be represented on the branch committee of management, not necessarily individually, but in some cases in regional groups. In other words, the proposition that the branch committee of management should consist simply of a number of .ee "re - GS =e "er ee aft 24, persons elected by the whole of the membership of the branch has been rejected in the case of the Queensland branch. This is a reasonable decision for the organization to take, and might well reflect a fear that it will be difficult to persuade people to join or remain members of the organization in areas of Queensland outside Brisbane unless they are given a voice on the branch committee of management. Given that such a decision has been taken, it may well have been assumed that if the representation of sub-branches was strictly in proportion with their membership, the situation would be little different from that which would exist without specific sub-branch representation; the smaller sub-branches would have no effective voice at all. It is worth noting that the addition of two more representatives of the Brisbane sub-branch, taking the total of the committee of management to sixteen, would still mean that the votes of three of the officers would be required to attain a majority of nine with all of the Brisbane sub-branch representatives. To give the Brisbane sub-branch a majority of voting power would require a committee of management of at least twenty-one. Such a restructuring would alter radically the balance between sub-branch representatives and officers. Of course, it is not for the Court to dictate to an organization the manner in which it should structure its rules, or even to speculate on how that might be done. It is legitimate, however, to have regard to the means which would be necessary to satisfy the applicants' point of view, and to the consequences which they would have on the existing " ee anne ee ee ee ey a en ee 25. structure, if the respondent chose to retain sub-branch representation. In the end, the application of principles such as those laid down in McLeish v. Kane is a question of degree, and largely one of impression. Taking into account the democratic safeguard involved in the presence of five officers on the committee of management, all elected by the whole of the membership of the branch, and the apparent rationale of the decision to give smaller sub-branches an effective voice on that committee, I am of the view that it has not been shown that the rules of the respondent impose on its members in Queensland conditions, obligations or restrictions which, having regard to the objects of the Act and the purposes of the registration of organizations under the Act, are oppressive, unreasonable or unjust, in respect of the representation of sub-branches on the branch committee of management. In these circumstances, it is unnecessary for the purpose of s.140(1)(c) to look at other provisions of the rules, to see whether extra democratic safeguards exist. The Rule to Show Cause also raises the question whether the rules of the respondent fail to make the provision required by reg. 115(1)(d)(v) of the Conciliation and Arbitration Requlations. In conjunction with reg. 115(2), that regulation requires that the rules of an organization provide for "the control of committees of the Corganization] and its branches by the members of the Corganization] and the members of the branches, mo ete le wae 26. respectively". This point was originally taken in conjunction with the application for an order pursuant to s.140(1)(c), and was related to the argument that the branch committee of management was not sufficiently subject to the views of the members of the Brisbane sub-branch. As it is raised by the Rule to Show Cause, however, the point must be dealt with separately. It should be pointed out that the regulation requires control of the branch committee of management by the members of the branch. This means that there is no provision of the Act or the Regulations requiring the rules to provide for the control of the branch committee of management by the members of the Brisbane sub-branch. On the other hand, the submissions of Mr. Kenzie as to the means whereby the branch committee of management might be controlled by the federal council or the federal committee of management of the respondent also missed the point. Even though the members of the Queensland branch vote for the branch's representatives on those federal bodies, control by the federal bodies is too remote, and too subject to the influences of the representatives of other branches, to be regarded as control by the members of the branch. It is necessary, therefore, to look at the rules for the purpose of ascertaining the extent to which the members of the Queensland branch are able to control the branch committee of management. It is well established by decisions such as Boland v. Munro (1980) 48 F.L.R. 66, at pp.78-81, that the control required is not necessarily the right to direct, but rather the ability to influence and to « . ss er pene se ey ry — re ere ems LP ereprenene an. 27. check on certain issues. It is also established that features of the rules which are themselves required by the Act, such as the requirement that the committee of management be elected by secret postal ballot (which arises from $.133AA) and the requirement that the persons elected to the committee hold office for a period not exceeding four years (which arises from s.133(1)(db))} are to be taken into account in determining whether the rules provide adequately for control. In the present case, the organization has chosen to elect its branch committees of management every three years, thereby adopting a shorter interval than the Act would permit; see rule 33(a). Rule 47(c)(ii) provides a machinery for the branch committee of management to reconsider its own resolutions, but a reconsideration seems only to be capable of initiation from within the committee itself. Under rule 37{c}, the branch president or branch secretary, upon receipt of a petition signed by 100 or more financial members, is required to call a special meeting of the branch to hear specific charges against the branch committee of management as a whole, or any one or more members thereof. This seems to be the only provision for a general meeting of the Queensland branch; provision is made by rule 43(k) for general meetings of branches where there are no sub-branches, but rule 43th), (i) and (j) provide for meetings of sub-branches where they exist. There is no provision whereby a general meeting of a sub-branch, or general meetings of any combination of sub-branches, can direct the branch committee ~ eqns oe FR er eens re nee ne Pro. he) moof tee "ee a 28. of management, or overturn any of its decisions. Under rule 37(e) and (f), the consequences of successful charges laid before a general meeting are the carrying of a motion of no confidence in the person or persons charged, and the declaration of the position of each such person as vacant. The charges which can be laid under rule 37(c) are limited by rule 25A to those prescribed by s.133(1)(f£) of the Act. Mr. Shaw argued that a decision of the Queensland branch committee of management could not be overturned by either a general meeting of the members of the branch, or by any plebiscite or referendum of the members of the branch. The former point appears to be correct, subject to the possibility of a general meeting to hear charges against the committee of management. The latter depends upon the construction of rule 62, which provides as follows: "(€a) The Federal Council may submit a matter affecting all or a section of members to a referendum of financial members in the area affected. (b) Such referendum shall be conducted by the Federal Returning Officer with the assistance of the Branch Returning Officer or Officers concerned. (c) The Federal Council shall submit a matter to a postal referendum of financial members of the Union: (i) On the request of at least three Branches who represent 25% of the effective membership of the Union acting through the B.C.O.M. or a Special Meeting of the Branch; or (ii) on a petition signed by any 1,000 financial members of the Union." ee oe too . 29. Mr. Shaw's argument was that the only referendum of members of a branch permitted by this rule was a referendum at the discretion of the federal council under sub-rule (a). He contended that a referendum resulting froma petition by 1,000 financial members, pursuant to sub-rule (c), could only be a referendum of the whole of the financial members of the union. I do not accept that this is so. The requirement that the federal council submit a matter to a referendum on such a petition is capable of being read as a requirement to submit the matter to a referendum of some financial members of the union. In the case of a petition from members within a particular branch, about a matter relating to the affairs of the branch, such a referendum would be appropriate. It is, therefore, possible for the members of the Queensland branch to require the federal council to conduct a referendum on a matter among the members of the Queensland branch. There are difficulties about such a_ referendum. The federal council is only required by rule 43(a) to meet annually. A special meeting can only be called under rule 43(b), upon a request of a majority of the members of the federal council or the request of two or more branches. Petitioners for a referendum may therefore wait for a considerable time before the federal council acts on the petition. In the second place, the number of members required to force a referendum is large for a branch the size of the Queensland branch. It would require a good deal of effort to obtain the signatures of 1,000 members out of a sac ate on a Me x 30. f total branch membership of little more than 12,000. Given that the persons seeking to overturn a decision of a branch committee of management may well be ordinary members of the respondent, rather than full time officials, the time and resources available to them for the obtaining of signatures to a petition may well be too limited to make it practical to secure the signatures of 1,000 financial members. The third problem is that nothing in rule 62, or elsewhere in the rules, expressly makes a decision of a branch committee of management subject to the result of a referendum. On the face of the rules, the committee of management could ignore the result of a referendum of branch members. Tt is true that an organization may take the view that a referendum or plebiscite is a cumbersome and expensive procedure, and is not to be too readily available as a means of controlling its committees. See Boland Vv. Munro at pp. 83-84. In the present case, however, the plebiscite provision is too difficult to invoke, and may well be ineffective in overturning an unpopular decision of the branch committee of management. The only effective means whereby members of the Queensland branch of the respondent can control the branch committee of management are the triennial elections and, possibly, the laying of charges before a general meeting. In the absence of any other more effective means, these are inadequate to satisfy the requirements of reg. 115(1)(d)(v). Some discussion took place in argument about the eree ee ree as wi res tet eer tee en eer oe 31. appropriateness of an adjournment of the proceeding, pursuant to s.140(6) of the Act, if the applicants were to succeed, in order to give the respondent an opportunity to alter its rules. That discussion was in the context of the applicant succeeding in relation to a particular rule. In that event, such an adjournment would have been appropriate, to avoid the consequences of a declaration that a particular rule contravened s.140(1) of the Act. As has been pointed out earlier, those consequences do not flow from a declaration as to the rules as a whole, which is the appropriate order upon the Court holding that the rules asa whole fail to make a provision required by the Regulations. The Act itself, by 5.140(7), gives the organization whose rules are the subject of such a declaration an opportunity to alter those rules within three months, or such longer period or periods as' the Industrial Registrar may allow under sub-s.(9). The making of a declaration also avoids the Court examining any alterations which may be made, and leaves the organization to satisfy only the Industrial Registrar as to the matters referred to in s.139(4) of the Act. A declaration similar to that sought in paragraph 2 of the amended Rule to Show Cause is therefore appropriate. Appearances Applicants: Mr. J.W. Shaw Q.C. with Mr. dg. Jerrard Instructing solicitors: Carberry & Co. Respondent: Mr. R.C. Kenzie Q.C. with Mr. M. Amerena we nape 5. {. TTT pee ea ee em ee pA ne . "a° os, . 32. Instructing solicitors: Hawthorn Cuppaidge & Badger Dates of hearing: 8th, 9th September 1987. I certify that this and the preceding thirty-one (31) pages are a true copy of the Reasons for Judgment of the Honourable Justice Gray. nated: 18 Sepiember AS Associate melaw © yous ; Seana canteen ee ee ee ee . ort " too.