FEDERAL COURT OF AUSTRALIA Prezbel Pty Limited, in the matter of an application for an inquiry relating to an election for offices in the Australian Hotels Association, New South Wales Branch [2003] FCA 242 WORKPLACE RELATIONS – inquiry under s 218 of Workplace Relations Act 1996 (Cth) – inquiry into alleged irregularity in election of delegates to Council of Australian Hotels Association, New South Wales Branch – proper interpretation of rules of Association – meaning of 'nominate as Delegates'- grammatical analysis – context of rule – whether person nominated must be financial member or nominated representative of financial member - whether a person may nominate himself or herself WORDS AND PHRASES – 'nominate', 'nominate as Delegate' Workplace Relations Act 1996 (Cth)ss 218, 223 FAI General Insurance Co Limited v McSweeney (1997) 73 FCR 379 cited Amalgamated Society of Engineers v Smith (1913) 16 CLR 537 followed Meehan and Tulloch, Grammar for Lawyers, Butterworths, 2001 PREZBEL PTY LIMITED v AUSTRALIAN ELECTORAL COMMISSION N 105 of 2003 WILLIAM CURTEIS & CO PTY LIMITED v AUSTRALIAN ELECTORAL COMMISSION N 106 of 2003 BRANSON J 24 MARCH 2003 SYDNEY IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY N 105 of 2003 BETWEEN: PREZBEL PTY LIMITED APPLICANT AND: AUSTRALIAN ELECTORAL COMMISSION RESPONDENT N 106 of 2003 BETWEEN: WILLIAM CURTEIS & CO PTY LIMITED APPLICANT AND: AUSTRALIAN ELECTORAL COMMISSION RESPONDENT JUDGE: BRANSON J DATE: 24 MARCH 2003 PLACE: SYDNEY REASONS FOR JUDGMENT INTRODUCTION 1 Each of Prezbel Pty Limited and William Curteis & Co Pty Limited applied to the Court under s 218 of the Workplace Relations Act 1996 (Cth) ('the WRA') for an inquiry into an alleged irregularity in relation to the election of officers, namely delegates to Council of the Australian Hotels Association, New South Wales Branch ('the Association'). The Association is an organisation registered under the WRA. 2 On 27 February 2003 I declared, in respect of each application, that I was satisfied that there was reasonable ground for the application. I fixed not before 12.00 noon on 14 March 2003 as the time for conducting the inquiry and the Federal Court of Australia, Queens Square, Sydney as the place for the inquiry. Directions were given to ensure that all persons who are or may be justly entitled to appear at the inquiry were notified of the time and place fixed for the inquiry. 3 At the commencement of the inquiry appearances were announced on behalf of the applicants, the Australian Electoral Commission, certain of the members of the Executive Committee of the Association and Mr John Thorpe, President of the Association. I was satisfied that the applicants, the Australian Electoral Commission and each of the individuals on whose behalf an appearance was announced was justly entitled to appear at the inquiry. They are to be taken to be parties to the proceedings before me. nature of the inquiry 4 Section 223 of the WRA provides: '(1) At an inquiry, the Court shall inquire into and determine the question whether an irregularity has happened in relation to the election, and such further questions concerning the conduct and results of the election as the Court considers necessary. (2) In the course of conducting an inquiry, the Court may make such orders (including an order for the recounting of votes) as the Court considers necessary. (3) If the Court finds that an irregularity has happened, the Court may, subject to subsection (4), make one or more of the following orders: (a) an order declaring the election, or any step in relation to the election, to be void; (b) an order declaring a person purporting to have been elected not to have been elected, and declaring another person to have been elected; (c) an order directing the Industrial Registrar to make arrangements: (i) in the case of an uncompleted election—for a step in relation to the election (including the calling for nominations) to be taken again and for the uncompleted steps in the election to be taken; or (ii) in the case of a completed election—for a step in relation to the election (including the calling for nominations) to be taken again or a new election to be held; (d) an order (including an order modifying the operation of the rules of the organisation to the extent necessary to enable a new election to be held, a step in relation to an election to be taken again or an uncompleted step in an election to be taken) incidental or supplementary to, or consequential on, any other order under this section. (4) The Court shall not declare an election, or any step taken in relation to an election, to be void, or declare that a person was not elected, unless the Court is of the opinion that, having regard to the irregularity found, and any circumstances giving rise to a likelihood that similar irregularities may have happened or may happen, the result of the election may have been affected, or may be affected, by irregularities. (5) Without limiting the power of the Court to terminate a proceeding before it, the Court may, at any time after it begins an inquiry into an election, terminate the inquiry or the inquiry to the extent that it relates to specified matters.' 5 The dispute between the parties as to the regularity or otherwise of the election of delegates to the Council of the Association ('the Council') calls into question the proper interpretation of rule 30.1(g) of the registered rules of the Association ('the Rules'). There is an urgent need for the parties to know the true meaning of rule 30.1(g) as another election to which the rule is relevant is to be held shortly. 6 The parties have indicated a desire for me to publish as soon as possible my view as to the proper interpretation of rule 30.1(g) leaving for later consideration, if necessary, other aspects of the inquiry. It is not unprecedented for the Court to publish part of its reasons for judgment leaving another part and final orders to be published later (see, for example, FAI General Insurance Co Limited v McSweeney (1997) 73 FCR 379). I have considered it appropriate to adopt the course which the parties wished me to take. Rule 30.1(g) and the alternative contentions 7 Rule 30 of the Rules is entitled 'Delegates to Council'. Its subject matter is the election of delegates to the Council. Paragraph (g) of subrule 30.1 provides: '(g) Eligibility to nominate and vote in election of Delegates The only persons who shall be eligible to nominate as Delegates and/or vote in any election for Delegates will be, at the date in October of any election year when the Returning Officer calls for nominations, either: a) Financial members of the Organisation OR b) A nominated representative of a member qualified as in (a).' 8 The applicants' contentions with respect to the proper interpretation of rule 30.1(g) are as follows: 'The phrase "eligible to nominate as Delegates" where it appears in Rule 30.1(g) is a reference to those eligible to propose or second the candidature of a delegate. Only financial members or nominated representatives of financial members of the organization may perform this function. Rule 30.1(g) should not be read as operating so as to close the class of persons on 14 October 2002 who might be validly be nominated as a delegate for a sub‑branch.' 9 The members of the Executive Committee of the Association who were represented at the inquiry submitted that rule 30.1(g) established 'a regime whereby members who are natural persons and members who are corporate persons may put themselves forward as candidates' and sets 'a common requirement for the same cut off date for eligibility to nominate as a candidate for either a natural person or corporate person … .' 10 Neither the Returning Officer, representing the Australian Electoral Commission, nor Mr Thorpe addressed submissions to the Court on the proper interpretation of rule 30.1(g) of the Rules. consideration 11 It seems to me that the approach to be adopted to the interpretation of the Rules, including rule 30.1(g), is that favoured by Isaacs J when considering the rules of the Amalgamated Society of Engineers in Amalgamated Society of Engineers v Smith (1913) 16 CLR 537. His Honour at 559 said: 'Now, I am disposed to give a very broad interpretation to the terms of association in a society of this nature. I am prepared to read them, not as the strictly prepared and technically framed stipulations inserted in some legal instrument of lawyers, but as the plain and business‑like statement of members of the trades concerned, combining for mutual support, and setting down the terms of their combination in language which is applicable to their situation and intended (subject to the presumptive intendment of legality) to be understood apart from technical rules of interpretation.' A careful consideration of the Rules tends to confirm that they have not, at least in their present form, been strictly prepared and technically framed in the same way as a legal instrument might be expected to be prepared and framed (see, for example, rule 2(b), rule 16.2, rule 20.7, rule 20.10 and, of course, rule 30.1(g)). 12 For the above reason I consider that only limited weight should be given to arguments based on a precise grammatical analysis of rule 30.1(g). Mr Ireland QC, senior counsel for the applicants, laid stress on the character of the verb 'nominate' as a transitive verb. In this sense 'transitive' means crossing or passing over. The action of a transitive verb passes over to a direct object (e.g. she submitted her report) while an intransitive verb does not take an object (e.g. the sun shines) (see Meehan and Tulloch, Grammar for Lawyers, Butterworths, 2001 at [2.45]). It is not, I think, entirely clear that the verb 'nominate' can only be used in the transitive sense. More importantly, as Mr Ireland acknowledged, even if the verb can only be used in a transitive sense, this does not answer the question of whether a person may nominate himself or herself. 13 The appropriate place to start, in my view, is with the actual words of rule 30.1(g) and to consider those words in the context provided by the Rules as a whole. That context may illuminate the meaning to be attributed to particular words found in rule 30.1(g). 14 In rule 30.1(g) the infinitive 'to nominate' is modified by the phrase 'as Delegates'. A crucial question for determination is what is to be understood by the composite phrase 'to nominate as Delegates' in rule 30.1(g). 15 I turn to consider the context within which rule 30.1(g) is to be construed. Rule 3 of the Rules is concerned with the structure of the Association. Rule 3 provides that the Association will consist of its members from time to time. Each members of the Association must be a member of a sub‑branch of the Association. The rule further provides that the governing body of the Association shall be the Council and that the Council will be elected by the members of the various sub-branches. 16 Rule 6 of the Rules reflects the eligibility of both corporations and individuals to be members of the Association. Rule 6 requires every corporate member to nominate a person to act as its representative and allows such nominations to be made from time to time. The rule allows, but does not require, individuals who are members to nominate a representative. A corporate member is only entitled to attend meetings, vote or nominate any person for office by its duly appointed representative (rule 6(g)). Rule 6(h) provides: 'A Member, not being a Corporate Member, who has appointed a Representative shall not himself or herself beentitled to attend meetings, vote or to vote or nominate or be nominated for or hold office whilst such appointment of Representative is unrevoked.' I give further consideration to rules 6(g) and (h) below. 17 Rule 20 of the Rules is concerned with the constitution of the Council. It provides that the Council shall consist of delegates elected to the Council by the members of the sub-branches and that only natural persons may be elected as delegates to Council. 18 The procedure for the calling of nominations, and conduct of elections, for delegates to Council is set out in rule 30 of the Rules. It is convenient to set out rule 30.1 in full: '30.1 Calling for Nominations (a) The Returning Officer shall call for nominations for Delegates to Council prior to 15 October in the year prior to the Election Year. (b) The notice calling for nominations shall be forwarded to each person entitled to vote in that election. The notice shall: (i) enclose a form of nomination (ii) require the nomination to be properly completed and forwarded to the Returning Officer within 21 days of the date of such notice. (iii) Indicate the time and date of the closing of nominations and the address to which nominations are to be forwarded. (c) Council may from time to time determine the form of any nomination form. A nomination form must be: (i) signed by the person so nominated (ii) signed by two persons proposing and seconding the person so nominated. The persons proposing and seconding the person so nominated must be persons entitled to vote in that election for which the person is nominated. (d) If the Returning Officer finds any nomination to be defective the Returning Officer shall, before rejecting that nomination, notify the person nominated of the defect and where it is practicable so to do give that person the opportunity of remedying that defect within a period not less than seven (7) days after being so notified. (e) The Returning Officer may in any notice calling for nominations specify a facsimile number to which nominations can be forwarded. The Returning Officer may then accept nominations lodged at that facsimile number before the time and date specified for receipt of nominations. The Returning Officer may require that the original of the facsimile nomination be forwarded in due course. (f) Where nomination forms must be signed by more than one party (eg the person nominated, the proposer and the seconder) the Returning Officer shall be entitled to accept as a valid nomination forms lodged in more than one part ie where the person nominated signs one part, the person proposing the nominations signs a second part etc. (g) Eligibility to nominate and vote in election of Delegates The only persons who shall be eligible to nominate as Delegates and/or vote in any election for Delegates will be, at the date in October of any election year when the Returning Officer calls for nominations, either: a) Financial members of the Organisation OR b) A nominated representative of a member qualified as in (a).' 19 It is of significance for present purposes, in my view, that rule 30.1 prescribes a process for the nomination of a person as a delegate to Council. The process involves the person nominated signing an appropriate nomination form and 'two persons proposing and seconding the person so nominated' also signing the form (rule 30.1(c)). None of the constituent steps in the process is itself characterised by the rule as a 'nomination'. The only thing characterised by the rule as a 'nomination' is the completed, or perhaps purportedly completed (see rule 30.1(d)), form of nomination. No person involved in the nomination process is described as a nominator. It seems that a person is nominated as a delegate under rule 30.1 when all of the steps which the rule requires for the completion of the nomination process have been undertaken. 20 The above understanding is confirmed by the terms of rule 20.10 which provides: 'If a Sub-branch shall fail to nominate sufficient numbers of Delegates to Council or shall fail to elect such Delegates to Council then Council shall have the power to fill such vacancy or vacancies from the Membership within the Sub-branch in default.' 21 It is against this background that the proper interpretation of rule 30.1(g) is to be considered. Rule 30.1(g) is concerned with '[e]ligibility to nominate and vote in election of Delegates'. Rule 30.1(c) provides that the 'two persons proposing and seconding the person so nominated' must be persons entitled to vote in the election in respect of which the nomination is made. As it is the prescription concerning eligibility to vote that governs their entitlement to participate in the nomination process, it seems unlikely that these two persons are intended to be affected also by the prescription concerning eligibility 'to nominate as Delegates'. Moreover, persons who propose and second a person nominated are not aptly described as 'persons who … nominate as Delegates'. A more natural reading of the words 'person who … nominate as Delegates' is to understand them as referring to the persons who take part in the nomination process as persons nominated to be delegates. On this reading, for a nomination to be valid, the person nominated to be a delegate to Council must, at the date in October of the relevant election year, be either a financial member of the Association or a nominated representative of a financial member of the Association. 22 It is necessary to consider whether the wording of rule 6(h) of the Rules, which apparently draws a distinction between 'to nominate' and 'to be nominated for', suggests against the understanding of rule 30.1(g) referred to in [21] above. The terms of rule 6(h) are set out in [16] above. Those terms, in my view, can only be properly understood when considered together with the terms of rule 6(g). Rule 6(g) provides: 'A Corporate Member shall not be entitled to attend meetings, vote or nominate any person for office except by its duly appointed Representative.' 23 It seems clear that rules 6(g) and (h) are together intended to provide, broadly, that where a member has a duly appointed representative, the representative effectively takes the place of the member so far as all conduct under the Rules is concerned. 24 Although it might be thought that the words 'or to vote' have been included in rule 6(h) in error, no party invited me to so conclude. I therefore proceed on the basis that those words have a function to play. On that basis a proper understanding of rule 6(h) is enhanced if it is structured in the following way: A member, not being a Corporate Member, who has appointed a Representative shall not himself or herself be entitled: (a) to – (i) attend meetings, or (ii) vote [by implication, at meetings]; or (b) to – (i) vote [by implication, in respect of an election for an office], or (ii) nominate, or (iii) - be nominated for, or - hold office while such appointment is unrevoked. 25 The simplicity of rule 6(g) when compared with rule 6(h) is in part explicable by the inability of a corporate member itself to hold office under the Rules. As a corporate member cannot hold office, a corporate member cannot be nominated for office. Only a person can be nominated for office under the Rules. However, the use of the words 'nominate any person for office' in rule 6(g) when rule 6(h) uses only 'nominate or be nominated for … office' is not so readily explained. 26 It seems to me that the explanation must lie in the inability of a corporation to hold office under the Rules. The phrase 'nominate any person' in rule 6(g) emphasises the necessity for all nominations for office, including those made by representatives of corporate members, to be nominations of persons. Rule 6(h) by contrast is framed to emphasise that an individual member who has appointed a representative loses the personal right to be involved in the nomination process both as a person proposing or seconding a person nominated and as the person nominated. To 'nominate' within the meaning rule 6(h) is to nominate someone else (ie to propose or second another person who is nominated). For this reason I do not consider that the distinction drawn by rule 6(h) between an entitlement to nominate and an entitlement to be nominated detracts from the understanding of the intended meaning of the phrase 'to nominate as Delegate' in rule 30.1(g). 27 On the view which I have taken of the proper interpretation of rule 30.1(g) of the Rules, the question of whether an individual may sign the one nomination form both as 'the person so nominated' and as one of the 'two persons proposing and seconding the person so nominated' is not answered by reference to that rule. It is, however, desirable in the circumstances for me to indicate my view on this question. 28 The verb 'nominate' is quite commonly used reflexively in relation to electoral processes. By reflexively I mean where the subject of the sentence is also, perhaps implicitly, the direct object of the verb. By way of example, it would accord with common usage for a person to say 'I have nominated for the seat of Grey' when that person intends to convey that he or she has taken steps to become a candidate in the election for the seat of Grey. 29 It also accords with ordinary usage to speak of a person 'proposing' himself or herself as a candidate for election to office. I need not consider whether it would accord with ordinary usage to speak of a person 'seconding' himself or herself. 30 In my view, if it were the intention of rule 30.1 to require three people to sign a nomination form, that intention would have been more explicitly conveyed by the words of the rule. This could readily have been done, for example, by inserting into rule 30.1(c)(ii) a requirement that the 'two persons' not include the person nominated. conclusion 31 I conclude that a nomination form will be signed as required by rule 30.1(c) where one and the same person signs as the person so nominated and as the person proposing the person so nominated. 32 I further conclude that on its proper interpretation rule 30.1(g) of the Rules requires that a person who signs a nomination form as 'the person so nominated' within the meaning of rule 30.1(c)(i) must, at the date in October of the relevant election year when the Returning Officer calls for nominations, be either: (a) a financial member of the Association; or (b) a nominated representative of a financial member of the Association. I certify that the preceding thirty-two (32) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Branson. Associate: Dated: 24 March 2003 Counsel for the Applicants: Mr J M Ireland QC Solicitor for the Applicants: McGirr James Hall & Associates Counsel for the Respondent: Mr J Heard Solicitor for the Respondent: Australian Government Solicitor Counsel for members of the Executive Committee of the Association: Mr B Hodgkinson and Mr J Nolan Solicitor for members of the Executive Committee of the Association: Carroll & O'Dea Counsel for John Thorpe: Mr J Martin Solicitor for John Thorpe JDK Legal Date of Hearing: 14 March 2003 Date of Judgment: 24 March 2003