FEDERAL COURT OF AUSTRALIA Herrington, in the matter of an election for offices in the Communications Division of the CEPU [2005] FCA 1012 INDUSTRIAL LAW – election inquiry – irregularity – where changes to rules resulted in certain members being unable to stand for office – where election conducted on the basis of invalid rules – irregularity occurred. STATUTES – interpretation – broad powers of electoral officials – whether duty to consider the exercise of the power – whether obligation to exercise the power. Workplace Relations Act 1996 (Cth) Schedule 1B, ss 142, 193. Re Churchill (2001) 109 FCR 104 doubted SHARELLE HERRINGTON, IN THE MATTER OF AN ELECTION FOR OFFICES IN THE COMMUNICATIONS DIVISION OF THE COMMUNICATIONS, ELECTRICAL, ELECTRONIC, ENERGY, INFORMATION, POSTAL, PLUMBING AND ALLIED SERVICES UNION OF AUSTRALIA N 811 OF 2005 N 829 OF 2005 MADGWICK J 24 JUNE 2005 SYDNEY IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY N 811 OF 2005 N 829 OF 2005 SHARELLE HERRINGTON, IN THE MATTER OF AN ELECTION FOR OFFICES IN THE COMMUNICATIONS DIVISION OF THE COMMUNICATIONS, ELECTRICAL, ELECTRONIC, ENERGY, INFORMATION, POSTAL, PLUMBING AND ALLIED SERVICES UNION OF AUSTRALIA JUDGE: MADGWICK J DATE OF ORDER: 24 JUNE 2005 WHERE MADE: SYDNEY THE COURT ORDERS THAT: 1. The rejection by the Australian Electoral Commission of Mr Dwyer's nominations for the offices of Divisional Executive Member, Lines and General Section, and Divisional Conference Delegate, Lines and General Section, in the New South Wales Postal and Telecommunications Branch of the Communications Division of the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia constituted an irregularity or irregularities. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY N 811 OF 2005 N 829 OF 2005 SHARELLE HERRINGTON, IN THE MATTER OF AN ELECTION FOR OFFICES IN THE COMMUNICATIONS DIVISION OF THE COMMUNICATIONS, ELECTRICAL, ELECTRONIC, ENERGY, INFORMATION, POSTAL, PLUMBING AND ALLIED SERVICES UNION OF AUSTRALIA JUDGE: MADGWICK J DATE: 24 JUNE 2005 PLACE: SYDNEY REASONS FOR JUDGMENT Madgwick J: 1 There are before the Court two applications. The first proceeding is an application for an inquiry relating to an election or, more correctly now, an inquiry relating to the election since I have already determined to institute such an inquiry. The election concerned is an election in the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia ('the Union'). The offices concerned are as described in the application for an inquiry and, broadly speaking, concern certain offices in the various State 'Postal and Telecommunications' branches. (In Victoria the cognate branch is known as the 'Telecommunications and Services' branch.) I will explain shortly the essential irregularity alleged. 2 The second application is an application pursuant to ss 142(1)(a), 142(1)(c) and 163 of Schedule 1B (Registration and Accountability of Organisations) ('the RAO Schedule') of the Workplace Relations Act 1996 (Cth) ('the Act'), and also relying on any other power the Court possesses under its own Federal Court of Australia Act 1976 (Cth), seeking relief in respect of the rules of that organisation. 3 The allegation is that the rules of the Communications Division of the organisation, as they apply to participation by the Telecommunications Officers Association ('TOA') Branch members, in the current elections before that division, contravene a number of sections of the RAO Schedule. 4 The background is succinctly summarised in the particulars of alleged irregularities given with the application for an inquiry relating to the election. In each proceeding the applicant, Ms Herrington, is and was at all material times a financial member of the Union. 5 On about 24 January 2005 the Union lodged changes to its Rules with the Industrial Registrar, pursuant to Chapter 5, Division 5 of the RAO Schedule. The purpose of the rule changes was to abolish the TOA Branch of the Union with effect from 1 August 2005 and to establish transitional arrangements for the transfer of members of that branch into other branches of the communications division of the Union. The rule changes provided (rule 89A) that persons who are financial members of the TOA Branch for 12 months prior to the closing of nominations for elections for positions in the branches were entitled to nominate for positions in those branches to which they were to transfer under the rule changes. 6 With minor modifications, the rule changes were certified by the Industrial Registrar pursuant to s 159 of the RAO Schedule on 27 April 2005. However, in accordance with the then registered Rules, on or about 21 March 2005, elections were called by the Australian Electoral Commission ('the Commission') for positions to be elected within the Communications Division. 7 The problem is exemplified by the position of Mr Dan Dwyer, a financial member of the organisation who, during the 12 months prior to the calling of nominations, had been a financial member of the TOA Branch. On or about 2 May 2005, the Commission received nominations from Mr Dwyer for the positions of Divisional Executive Member and Divisional Conference Delegate for the New South Wales Postal and Telecommunications Branch. 8 On or about 5 May 2005, the Commission's returning officer notified Mr Dwyer that his nominations were rejected because of alleged non-compliance with rule 66(a) of the Rules. That rule provided that persons are eligible to nominate for branch positions only if they have been financial members of the branch for not less than 12 months immediately prior to the closing date of nominations. 9 The returning officer took the position he did because, as Mr Dwyer had not been a financial member of the New South Wales Postal and Telecommunications Branch, as distinct from the TOA Branch, for 12 months preceding the closing date of nominations, he was ineligible to nominate. In taking that view, the returning officer relied on regulation 132 of the Workplace Relations (Registration and Accountability of Organisations) Regulations 2003 ('the RAO Regulations'). The Regulation provides: 'For sections 193, 197 and 198 of the RAO schedule, the rules of an organisation or branch are the rules in force on the day nominations for an election open.' 10 So far as is presently material, s 193 provides that an electoral official, such as the returning officer here, conducting an election subject to par 193(1)(b) must comply with the rules of the organisation or branch. Paragraph 193(1)(b) provides that the electoral official: '(b) may, in spite of anything in the rules of the organisation or branch, take such action, and give such directions, as the electoral official considers necessary: (i) to ensure that no irregularities occur in or in relation to the election; or (ii) to remedy any procedural defects that appear to the electoral official to exist in the rules; or (iii) to ensure the security of ballot papers and envelopes that are for use, or used, in the election.' 11 Section 197 provides for a post-election report which is to include, among other things, aspects of the Commission's experience of the election and difficulties in the rules which is implied ought to have had consideration by the organisation. Section 198 obliges the organisation to give a written response. 12 Section 142(1)(c) of the RAO Schedule provides that the rules of an organisation: '(c) must not impose on applicants for membership, or members, of the organisation, conditions, obligations or restrictions that, having regard to the objects of this Schedule and the workplace Relations Act and the purposes of the registration of organisations under this Schedule, are oppressive, unreasonable or unjust; …' 13 Section 142(1)(a) requires that the rules of an organisation 'must not be contrary to, or fail to make a provision required' by the Schedule, the Act itself or other extant industrial instruments 'or otherwise be contrary to law'. 14 Section 163 permits a member of an organisation to apply to the Court for remedies in relation to contraventions of s 142. 15 Section 143 requires the rules of an organisation to provide for the elections of office holders in organisations by 'a direct voting system' (so far as the present case is concerned). The argument, which has some support in the authorities, is that such a system implies that the office holder should be elected by the members whom he or she is to represent as well as that being done in a 'direct', as distinct from collegiate, way. 16 The nominations for the relevant elections opened on 1 April 2005 and it is clear that the returning officer was correctly relying on regulation 132 when he relied on the Rules as registered and therefore in force on that day. Those Rules did not include the transitional rules. The problem, succinctly put by counsel for the applicant in her submissions, is that: 'In short, the form of the transitional Rules, combined with the timing of the rule changes appear to have the effect that: (i) There is no provision for TOA Branch members to vote in Divisional elections in 2005; and (ii) TOA members are unable to stand for Branch positions in the Divisional elections in 2005.' 17 Thus, the Rules necessitated the returning officer's rejection of Mr Dwyer's nominations for the two offices mentioned above. To my mind, it is quite clear that the Rules fail to comply with section 142(1)(c) of the RAO Schedule in that they do not permit TOA Branch members to vote or nominate for office in any branch election. 18 It is, further, clear that the application of the Rules being thus defective has resulted in the returning officer's rejection of Mr Dwyer's nominations and would otherwise result in widespread irregularities in relation to elections to offices which affect TOA Branch members for the purposes of s 206 of the RAO Schedule. That is the section which provides for the conduct of an inquiry by the Court into whether an irregularity has occurred and empowers the Court to make remedial orders. 19 On 27 May 2005, I made interim orders which had the effect of requiring ballot papers for relevant branch elections to be sent to TOA Branch members and requiring that no further steps be taken with respect to the positions for which Mr Dwyer had been the sole nominee, pending further order of the Court. 20 A definition of the term 'irregularity' in inclusive terms is contained in s 6 of the RAO Schedule, but it is well settled that that definition is not exhaustive. It is also clear that an irregularity may arise where an election is conducted in accordance with, or in reliance upon, a rule or rules which is or are invalid because they do not meet the requirements of s 142 of the Schedule and even where proceedings have not been brought for a declaration of invalidity. 21 Some observations were made by Finkelstein J in Re Churchill [2001] FCA 469; (2001) 109 FCR 104 at [35], in the course of which his Honour said: 'In the case of elections for office holders, this obligation [a term his Honour used to incorporate reference to one of the stated objects of the Act, namely to encourage the democratic control of organisations] is satisfied when all financial members of an organisation have the right to vote at an election.' 22 For myself, I would be inclined to express that a little differently, but it is certainly true that the rules would be oppressive, unreasonable and unjust if they deny financial members the right to vote at an election. Further, it is plainly unjust that, subject to some reasonable qualification period upon membership of the Union, members might not be permitted to stand for office in the relevant organs of the organisation. 23 Accordingly, irregularities have occurred. 24 The rejection of Mr Dwyer's nomination for the two offices, though authorised by the Rules, was contrary to law because the Rules themselves contravened s 142. (I need not consider whether they also contravene s 143.) 25 The provision to the electoral officer by the Union's Communications Division branches of electoral rolls, which excluded TOA members, though again provided according to the Rules, had the quality and vice of being based on rules which contravene s 142, and would have denied members a right to vote. A further irregularity would occur if the ballots for contested positions were conducted on the basis of the exclusion of the TOA Branch members from voting. The irregularities referred to have the potential to affect the result of the elections and, accordingly, the Court is empowered to intervene; cf. s 206(5) of the RAO Schedule. 26 Under s 206(4)(a) the Court has the power to make an order declaring that the rejection of Mr Dwyer's nominations constituted an irregularity, and to make an order declaring that the provision of the rolls referred to constituted an irregularity. Section 206(4)(d) empowers the Court to make an order (including, so far as presently relevant, an order modifying the operation of the rules to the extent necessary to enable a step in relation to an election to be taken again) 'incidental or supplementary to, or consequential on, any other order under this section'. 27 The powers of the Court under s 206(4)(d) have been widely construed; see In the Matter of an Election for an Office in the Communications Workers' Union of Australia, Postal and Telecommunications Branch, New South Wales, a decision of Moore J given on 3 June 1996 in the Industrial Relations Court of Australia (decision number 236/96). The Court has ample power to make the orders sought by the applicant, and acquiesced in by the Commission, which has also appeared in these proceedings. 28 Initially, the application for the institution of inquiry into the election contained material which could have been read as critical of the returning officer of the Commission. I should say that, in my opinion, no criticism can fairly be attached to the Commission or any returning officer. The Commission took the view that: 'On the available evidence the problem in this matter appears clear, and the solution appears equally clear. There appears to be no doubt that the Court has power to make orders to solve the problem of the "disenfranchisement" of the TOA Branch members in the present round of elections. … However, the applicant had earlier submitted to the NSW Returning Officer that the [returning officer] should have exercised powers under s 193(1) of the RAO schedule to solve the problem. The New South Wales [returning officer] did not take steps to "solve" the problem.' 29 The Commission presented thoughtful submissions to draw the Court's attention to matters of principle which, in the Commission's view, properly constrain returning officers where difficulties arise because of changes of rules or 'substantive' defects in rules affecting elections, or other 'substantive' relevant circumstances within an organisation. The reference to the word 'substantive' I have in mind is in relation to matters specified in s 193(1) of the RAO Schedule, set out above. 30 There has been no full argument of the matters, but I am inclined to think that the scheme and structure of s 193(1) is as follows: in subpar (i), the electoral official concerned is given a very broad remedial power to take action and give directions necessary to avoid irregularities in or in relation to the election in question. That power is not limited to irregularities of a 'procedural', as distinct from 'substantive', kind. If it were so limited, there would be no necessity for paragraph (ii). That paragraph seems to be entirely ancillary to the electoral official's power under par (i) and to contemplate the remedying of procedural defects which, themselves, might not amount to irregularities but which might also involve some overriding or supplementation of the operative rules. 31 Although the electoral official is given a broad power, it is a power, and although no doubt there is a duty to consider the exercise of the power, there is no obligation to exercise the power. I should think the underlying reason for that is that the kinds of irregularities that might occur are many and various, and the distinction between substantive and procedural is, at least at the margins, elusive. There may be major infractions of the requirements of the legislation which, on any view, would be called substantive defects in the rules, but for which, as here, there is a reasonably clear and uncontroversial means of rectification. There is no warrant that I can see for reading 193(1)(b)(i) down to prevent an officer acting in such a case. 32 On the other hand, there will be many instances where it is a hotly contested matter whether the rules relating to an election are in contravention of a provision of the legislation which governs organisations, and an electoral official may well consider that it is appropriate that the dispute be determined by the Court once he or she has formed a prima facie view that there has been an irregularity, including one brought about by non-compliance of the rules with the Act. 33 It is certainly the case that regulation 132 was intended to clarify, for electoral officials and others in a situation of changing rules, which version of the rules should be applied. In my view, the involvement of the Commission, with the long history of that body and its predecessors in conducting general elections in Australia, as well as elections in organisations, supports the view that the power intended was broad, and that the discretion in the electoral officers themselves to act or not act is a broad one too. 34 The question does arise, however, whether, for the sake of cases of this kind, the legislation, if the regulation of unions is to continue, might not usefully be supplemented with a power in electoral officials to seek directions from the Court – in the way, for example, that persons concerned with the administration of insolvent estates can – in a more informal and, therefore, likely a quicker way than by the inquiry procedure presently established. 35 I repeat, I see no reason for any criticism for any failure by the electoral official concerned to give directions under s 193, particularly when there has apparently been some doubt about the scope of the s 193(1)(b)(i) power. Regrettably, because this case has not been the subject of full argument, since the parties are ad idem and my views may not wholly accord with some strands of prior authority (see Re Churchill (2001) 109 FCR 104), a degree of doubt might still remain. 36 In relation to the application under s 163, leave to discontinue is sought. There is no question of inconveniencing anybody else as to costs or otherwise and leave will be granted. I certify that the preceding thirty-six (36) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Madgwick. Associate: Dated: 25 July 2005 Counsel for the Applicant: Ms Claire Howell Solicitor for the Applicant: Slater & Gordon Solicitor for the Respondent: Australian Government Solicitor Date of Hearing: 24 June 2005 Date of Judgment: 24 June 2005