Neilson, Richard Wayne v Corsetti, J & Ors [1998] FCA 134

IN THE FEDERAL COURT OF AUSTRALIA

VICTORIA DISTRICT REGISTRY VI 1273 of 1997

BETWEEN: RICHARD WAYNE NEILSON

Applicant

AND: J CORSETTI and OTHERS

RespondentS

COURT: NORTHROP J

DATE: 13 FEBRUARY 1998

PLACE: MELBOURNE

REASONS FOR JUDGMENT This is a matter with a very unfortunate history. The applicant, Mr Neilson, was elected to an office within the organisation at elections held in mid-1994. He commenced his term of office on 1 September 1994 and it appears that it was for a term of four years. Although reference has not been made to the rules, it would appear that he will cease to be an officer pursuant to that election on 1 September 1998. In 1996, on 9 December, a member of the organisation notified Mr Neilson of charges made against him in relation to his conduct as an officer in the organisation. On 24 February 1997 the Court, constituted by Marshall J, granted a rule nisi calling upon a large number of respondents, essentially the members of a State group of the organisation who are charged with the hearing of the complaints against Mr Neilson to show cause why a number of orders should not be made. The orders were based upon a number of grounds but for relevant purposes, the two relevant ones are based on s 209 of the Workplace Relations Act 1996. The first ground was that the relevant group had no jurisdiction to hear the charges against Mr Neilson, that appears in Order 1 of the rule nisi. The second, Order 2 - was:- "That the respondents and each of them, by themselves, their servants or agents, or otherwise, perform and observe the rules of the Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union ("the Union") by treating the charges as null and void and of no effect." The basis of that order was that the charge was brought in bad faith by Mr Corsetti or the then Secretary Mr Ryan, another member of the organisation, in circumstances where it was alleged that the majority of the persons who constituted the group to hear the charges, were of a similar persuasion and, in all probability, would decide the charge in favour of Mr Ryan and Mr Corsetti and adversely to Mr Neilson. At the same time, Marshall J made an order to the effect that the respondents perform the rules of the organisation by ceasing and refraining and taking any or any further step or steps or actions for the purpose of or in relation to the determination of the three charges brought against Mr Neilson in December 1996. The first directions hearing came on before Marshall J on 17 March 1997. Following argument, the Court continued the injunction but made it clear that the only reason for so doing - and without having considered the other aspect under what was described as a mini‑trial - was the jurisdiction point, being the basis of Order 1 of the rule nisi. The Court directed that a separate question be heard pursuant to O 29 of the Rules of Court, the question being - "Is the Victorian State Council of the Union empowered by r 11.3 of the Rules of the Union to hear and determine charges of gross misbehaviour or gross neglect of duty against the Regional Assistant Secretary/Organiser, Food and Confectionery Division?" That was the office held by Mr Neilson. The injunction was continued - I use the word "injunction" intentionally, there being no indication by his Honour whether he continued that order under s 209(4) of the Workplace Relations Act 1996 or under the general provisions of the Federal Court of Australia Act 1976 to make interlocutory or interim orders. Orders were made relating to fixing a date for the hearing of the matter. These orders made it obvious that the matter was to be treated as one of some urgency and that the matter should be heard as soon as possible. Thereafter it is not clear what happened. The matter was not listed for hearing. It was not until September 1997 that the matter came on for directions before the Federal Court of Australia, which by that time had taken over the jurisdiction of the Industrial Relations Court of Australia. The question of the hearing of the preliminary question was discussed and the matter was set down for hearing. On 21 November 1997 the Court gave its decision on that preliminary question, the order being - Question, "Is the Victorian State Council of the Union empowered by r 11.3 of the Rules of the Union to hear and determine charges of gross misbehaviour or gross neglect of duty against the Regional Assistant Secretary/Organiser, Food and Confectionery Division ?" Answer, "Yes." At the same time as giving judgment the Court adjourned the directions hearing to 19 December 1997. At that directions hearing, the respondents or rather the respondents who had appeared to oppose the orders being sought by Mr Neilson - and I will refer to them as the respondents but they are not all respondents named in the application - relied upon a motion, notice of which was dated 17 December 1997 for an order discharging the interlocutory injunctions made by Marshall J in March of 1997. At the directions hearing on 19 December the Court gave directions as to the filing of affidavits in relation to the other matters remaining in dispute and for the hearing to take place some time after March 1998 and adjourned the matter for further directions to a date to be arranged and notified to the parties. In relation to the motion to discharge the injunction, the Court gave directions that the motion be heard on 13 February 1998, that is today, and gave directions as to the filing of further affidavits, if they were sought to be relied upon by the applicant and respondent. No further affidavits were filed. The order of the Court of 21 November 1997 was an interlocutory order and could be appealed from only pursuant to leave being granted. Order 52 r 10 provides that the application for leave could be made to the judge making the order at the time of the order. That was not done. Otherwise, by application to another judge by motion in the action, or to the Full Court by motion in the action, in either case within seven days, although that time could be extended by either the single judge or the Full Court, leave to appeal could be sought. No application for leave to appeal was filed in the seven days after 21 November 1997 but much later in February of 1998 a motion was filed for leave to appeal from the order of 21 November and also for an extension of time in which to make that application. That motion is listed to come on before a Full Court on 30 March. Normally, on the facts of this case as set out, this is a case where, in all probability, the Court would discharge the rule nisi. The essential basis of doing so would be that there has been no commencement of a hearing before the State Council of the charges made against the applicant. Normally, in a case of this kind, the Court would require the person challenging the right of the group appointed to hear the matter to take the objection before that group for reasons then given. This is so particularly having regard to Order 2 of the rule nisi which is directed to the charges themselves and nothing more. The group should consider the objections raised and then determine whether to reject the objections and proceed with the hearing or to accept the objections and not proceed with the hearing of the charges. The principles to be applied in cases of this kind are well understood. It is not appropriate to come straight to the Court, but to take those steps first before the group proposing to hear the matter. If that group rejects the submissions made on this point, normally one would expect the person charged to seek an adjournment of the hearing of the charges to enable an application to be made to the Court for an interim injunction to restrain that group from proceeding with the hearing. That has not been done in this case. In my opinion, to come straight to the Court before taking that step is a defect which should not be encouraged and should be taken into account when considering whether the injunction should be continued. Normally this would be treated as being adverse to the interest of the applicant. But superimposed upon those facts there are other matters which may call for a consideration. It is apparent that elections have already been commenced for the election to the office of which the present applicant is the holder. It is accepted that the applicant has nominated as a candidate for that office. It also appears to be accepted that a ballot will be necessary to fill that office and in all probability that ballot will be announced in May, possibly by mid-May 1998 or shortly thereafter at the latest date. The effect of that election is this, as I understand it. If the election takes place and the applicant is defeated, his term of office would expire in September 1998, even though - and I am not sure of this - the ballot has been declared much earlier. If he is not elected he would cease to be an officer from the time of the expiration of his current office. If he is elected, he would be entitled to take office, presumably again from 1 September 1998, and these charges against him would have no relevance to the holding of that office. This is in the circumstances where, under the provisions of the Workplace Relations Act, an elected officer cannot be removed from office except on specified grounds. This aspect was discussed to some extent in the reasons for judgment given on 21 November. In these circumstances, consideration must be given to the effect of s 209 of the Workplace Relations Act. The only relevant ground of the rule nisi for present purposes that has been read out earlier and is not repeated, is directed to the bad faith on the part of the person making the charge, and indirectly, possibly the members of the State Council being affected by that same bias. If the matter does proceed to trial, it may be necessary to give consideration to a rewording of that Order of the rule nisi. The rule is based upon s 209. Subsections (3) and (4) are of importance. I read them both:- "3. The Court may refuse to deal with an application for an order under this section unless it is satisfied that the applicant has taken all reasonable steps to try to have the matter, the subject of the application, resolved within the organisation." "4. At any time after the making of an application for an order under this section, the Court may make such interim orders as it considers appropriate and, in particular, orders intended to further the resolution within the organisation concerned of the matter the subject of the application." In the present case, in my opinion, the subject of the application is the removal of the applicant from the office to which he has been elected. He can only be so removed if charges of a certain kind are proved against him. Here the charges which form the subject of the matter to be determined by the State Council could come within this category. There has been nothing put before the Court, as far as I can see, of any compliance with s 209(3), although this does not act as a bar but only as a discretionary matter. But subs (4) does give a jurisdiction to make interim orders in the circumstances referred to in that subsection. In the course of submissions, counsel for the applicant referred to the provisions of the Act relating to protected actions, in particular to sections 170MU, 170ND and 170NG and the fact that on two occasions North J had made interim orders pursuant to the power to grant injunctions contained in s 170NG. I do not find those authorities or practice of any assistance in this case. This is a case which, in my opinion, is to be decided under s 209(4). To some extent different considerations may apply to those generally applicable to the granting of interlocutory injunctions which are well-known and understood and are expressed clearly and succinctly by the Full Court of the State of Victoria in Magna Alloys & Research Pty Ltd v Coffey & Ors (1981) VR 23 at 28 although the first matter, these days, relates to whether the facts show a serious issue to be tried. Those principles are relevant. They are expressed in many different ways in other cases but that is the way in which they are applied. This involves, to some extent, a consideration of the strength of the serious issue to be tried as well as the balance of convenience of the competing parties. In many cases such an approach may not be appropriate in cases of proceedings brought under section 209 of the Workplace Relations Act. But under subsection (4) the Court is given a power to make such interim orders as it considers appropriate, and in particular, orders intended to further the resolution within the organisation concerned, of the subject of the application. Much was said during the course of submissions as to the political (industrial) nature of the conflicts arising within the organisation and Mr Neilson and other members of the controlling bodies. Reference was made to the problems arising during an election campaign if the parties are diverted from their real duties for the purpose of defending charges in circumstances which could have an adverse effect on the electioneering for the officers the subject of the charges. What the court does take into account here, in relation to elected officers, is that eventually it is for the members who have the right to vote to elect people to such an office to express their opinion. There is in existence the election procedures in which this office is involved and in these circumstances, this is one means by which the differences of opinion can be resolved within the organisation as a result of the outcome of that election. As against that, it is argued that the effect on members of the organisation is such that they should know whether the applicant is guilty of the charges which have been laid against him. This could affect the nature of his capabilities or attributes to be re-elected to that office. It is a nice balancing act as to whether that is a factor sufficient to overcome the other principle of letting the applicant continue with his campaigning without having to face these charges which, it is claimed, have been brought in bad faith. If the current injunction is discharged, it is not clear when the hearing of the charges would commence but one could assume it would be fairly speedily. The hearing of the application presently before the Court cannot come on for hearing normally before some time in March, possibly later. In all probability any judgment on this question under s 209 would not be until after the announcement of the result of the ballot. In other proceedings it may well be that it is appropriate to consider whether the Court should proceed at all with the hearing of the application, having regard to the current elections taking place. The relevant principles are discussed in a judgment given by the Court recently in Gerrard v Mayne Nickless Ltd, Northrop J, 17 December 1997, Federal Court of Australia, unreported. They do not arise before me today but in due course they may come before North J who is the judge on whose docket this matter will be listed. In all the circumstances, and having regard to the wording of s 209(4), this is a case where I should not discharge the injunction but allow it to continue pending the hearing and determination of the application itself or until further order. I stress the fact that this is an interlocutory order in the sense it can be varied from time to time. I stress also that other applications may be made in this matter going to the substantive issues. But at the present time, having regard to the existence of the current election and the provision of s 209(4) of the Workplace Relations Act, I refuse the motion by Mr Corsetti. I certify that this and the preceding seven (7) pages are a true copy of the Reasons for Judgment herein of the Honourable Justice R M Northrop