In the matter of the Conciliation and Arbitration Act 1904 and in the matter of the Australasian Meat Industry Employees Union, an organisation of employees registered under the said Act and in the matter of an application pursuant to section 171C of the said Act between Maxwell, Colin Aubrey v Gall, Nellie Evelyn & Anor [1978] FCA 41

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CATCITWORDS

Industrial law - organization of employees - elections - right to vote limited to financial members - opportunity to vote extended to unfinancial members - invalidity - whether order rectifying invalidity or negativing or modifying its consequences wculd not do substantial injustice to any member of tne organization - Conciliation

and Arbitration Act 1904 s.l1l71c

Colin Aubrey Maxwell v. Nellie Evelyn Gall and Kenneth Ross Belsham

Qld. No. 1 of 1978 CORAM: J.B. Sweeney, Keely and Deane JJ. DELIVERED: 15 June, 1978

AT: Sydney

IN THE FEDERAL COURT OF AUSTRALIA

INDUSTRIAL DIVISION ) Qld. No. 1 of 1978 ) )

NEW SOUTIT WALES DISTRICT REGISTRY

IN THE MATTER of the Conciliation and Arbitration Act, 1904

AND IN THE MATTER of the Australasian seat Industry Employees Union, an organisation of employees registered under the said Act

AND IN THE MATTER of an application pursuant to Section 171c of the said Act

BETWEEN COLIN AUB?PEY MAXWELL

Applicant AND NELIIE EVELYN GALL and KENNETH ROSS BELSHAM Respondents

JUDGES MAKING ORDER: J.B. SWEENEY, KEELY and DEANE Jv.

DATE OF ORDER: 15 June, 197

WHERE MADE: Sydney

ORDER OF THE COURT:

1. The Court declares that én invalidity has occurred in the election conducted in August, 1977 in the Queensland Branch of the Australasien Meat Industry Employees Union.

2. The Court 18 not satisfied that an order as to such invalidity would not do substantial injustice to a member of the organisation.

3. The Court refuses to make any order as to the said invalidity.

4. The application is dismissed.

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IN THE FEDERAL COURT OF AUSTRALIA )

) No. QLD. 1 of 1978

INDUSTRIAL DIVISION )

IN THE MATTER of the Conciliation and Arbitration Act 1904-1974

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IN THE MATTER of THR AUSTRALASIAN MEAT INDUSTRY LCMPLOYEERS Uhich an Organization of Employees registered under the said Act

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IN THE MATTER of an application pursuant to Section 171C of the said Act

BETWEEN COLIN AUBREY MAXWELL

Applicant AND NELLIE EVELYN GALL and KENNETH ROSS BELSH is Respondents CORAM: J.B. Sweeney, Keely & Deane JJ. 15TH DAY OF JUNE, 1978 REASONS FOR JUDGMENT J.B. SWEENEY, KEELY & DEANE JJ The applicant, 15 a

member of the Australasian Meat Industry Employces' Union

("the Union") which 1s an organization of employees registered

under the provisions of the Conciliation and Arbitration Act

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1904 ("the Act").

'

In August, 1977 the yuadrennial elections of officers

of the Qucensland Branch of the Union took place The ballot was a postal one. The applicant was a candidate in those elections for the office of Queensland Branch Secretary. He

was declared, by the Returning Officer, to have been elected

to that office. The respondents, Nellie Evelyn Gall and Kcnneth

Ross Belsham, are also members oi the Queensland Branch of

the Union. They were unsuccessful candidates in those cle'tions

for the office of organizer and Branch President respectively. On 19 September 1977, the respondents applied to this Court for an inquiry under Part IX of the Act into a number of alleged irregularities in the elections. The alleged irregularities, as particularised, included an allcg- ation that persons not entitled to vote by reason of being unfinancial pursuant to the registered Rules of the Union ("the Rules") were in some cases allowed to vote. It is common ground between the parties that in excess of 1600 members who had paid the contributions for and who were the holders of financial tickets in respect of the period of six months immediately preceding the election but who owed the Union money in respect of contributions for previous periods were included in the rolls of persons entitled to vote in the elections and had been afforded the opportunity of so voting 1ntwo of the Branch's three districts. It 1s also common ground that there 1s no way of ascertaining precisely how

many of those more than 1600 members did, in fact, vote by

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one anette te

returning a completed ballot paper. We shall, for conyeniencc, refer to those more than 1600 members as being "historically

unfinancial". The application for an inquiry was duly referred to the Court by the Industrial Registrar and has been adjourned

by the Court pending the outcome of the present procceding:;.

In the present application, the applicant sceks orders,

pursuant to s.171C of the Act, to the following cffect.

1. A declaration pursucnt to Section L71lC(1l) that an invalidity has oewzurred un the elections conducted tn 1977 tn tne Queensland Branar of the Australasian Meat Indusiry knployees' uncon in the granting of « vote to members noldin, a current ticket for the half year ending 30t* June, 1977 who were unfrnanetal in terms of Rule 10 of the Federal HKiles of the said Unton.

2. An Order pursuant tc Seetton L71C(2) reetifuing the invalidity and providing that the eleetions should not be invalidated by reason of such per- sons being pernitted to vote.

The applicant and the successful candidates in the elections the subject of the adjourned inquiry under Part IX agreed that, 1f the present application should fail, no opposition will be offered to an order, in tnat inquiry, that new elect- 1ons be held in respect of all of the offices involved in the elections other than those to which candidates were clected

unopposed.

The elections were for a total of forty offices in 'the Queensland Branch. Three candidates weré clected unopposed. The remaining 37 positions were contested. Each member ol

the Branch who was entitled to cast a vote was entitled to

vote 1n respect of every position. It would seem that hallot

papers were sent, by mail, to some 12,000 (approximatcly) persons who were included on the rolls of those entitled to vote including the more than 1600 historically unfinancial

members who were so included.

The margin between a successful candidate and his closest unsuccessful opponent was less than 600 votes in all but one case. The one exceptiou was Mr. T.F. Casey who was one of seven candidates elected as Section representatives on the Branch Committee of Management. The margin between Mr Casey and the closest unsuccessful candidate was 1644 vole3. It would seem apparent that he would have been elected even if the opportunity of voting had not been extended to the nore than 1600 historically unfinancial members. In the case ot all other successful candidates in the contested elections, it 31s plainly a matter of speculation whether they would have been elected to office in the event that the opportunity to

vote had not been extended to those members.

At the time the clections were held, the Rules of the Union expressly provided that "only members of the Union financial in accordance with these rules shall be entitled to exercise a vote at any election" (Rule 53(19) (3)). Rule 10

of the Rules provided?

"A member who oves to the Union:-

(a) Any contrtbutions for a longer pertod than one calendar rnonth after tne due date fox the payment cheresf; or

(b) Any levy for a longer pertod than one calendar month after the last day on whieh such levy may be patd, or

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(e) Any fine for a longer perio month from the date of the the fine; or

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shall ke deemed unfing inetal and while he so rerains

unfinanetal shall be exeluded from all the priv: tleges,

but not from the obligations of membership." Rule 6(1) provided:

"A sum in payment of contributions of an amount of not less than ten doll ars (810) and not more trim twenty-five dollars (625) as may be decided upon by the Committee of Murnagemenl of any Braneh, shall be paid half-yearly not later than Tanuaru Bist and July olet caen »ear by all members, each branch, sub-branch or distrier comm (ree shall have the right to demand payrent of such contributions, for whiek a membershup Lieket shall be issued, condirronally, that all ft- levies due are paid, such tieket Lo be int able between all branetes of the Union. F jotning the Union folleoving these datee an unfinanetal members who pay all ecntriburi fines, and levies shale be tssued with a biex

It has not been suggested that any of the historically unjinancial

members who were afforded the opportunity of voting had, by reason of estoppel, waiver or oth=2rwise ceased to be liable to the Union in respect of their past unpaid dues. Indeeca, 1t was accepted by all parties that, by reason of such unpaid contributions, the members in question were to be deemed un- financial pursuant to the provisions of Rule 10 and, in the result, were, by the cumulative operation of Rule 6, Rule

10 and Rule 53(19)(3) (see above), not entitled to vote on the elections. The extending of the opportunity to vote to the more than 1600 historically unfinancial members in question and the taking into account of the votes of such of them as took advantage of the opportunity was in breach olf the Rules

of the Union.

The rules of a registered industrial organization

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of employees comprise the compact between the members of the organization. Under and by thom, members customarily empower their elected representatives to act on their behalf in matters which will not infrequently be of fundamental importance to the members' livelihood and well-being. The mombers of such an organization are ordinarily entitled, both as a ma.ter of law and of common justice, to expect that their elected representatives will obscorve any restrictions placed, by the rules, upon the powers entrusted io them and that the persons held out as possessing such powers; will, in truth, be perscns elected as such representatives 11 the manner prescribed by the rules. A member of such an organization who seeks to be elected to an office within it 1s, likewisc, ordinarily entitled to expect and assume, both as a matter of law and of common justice, that the provisicus of the rules relating to the conduct of, and the determination of the successful candidate or candidates in, the election for such office will be fully observed. The Act contains a number of provisions which are designed to modify or overcome, 11 appropriate cases, the results of irregularities and errors including crrors and irregularities in the elections of officers of a registered organization. These provisions should not however be seen as effecting or justifying any gencral discounting either of the importance of the rules of a registered organization of employees as the source from which the elected representatives derive their powers or of the right of the members of such an organization ordinarily to insist that the persons who purport

to exercise those powers are, in truth, the persons who have

been determined by the processes which the rules prescribe.

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The evidence establishes that the cxtending of the opportunity to vote to the more than 1G00 historically un- financial members was the result of honest mistake. There was a wide-spread view in the Qucensland Branch of the Union that 1f a member of the Union was currently financial (in the sense that he was the holder of a financial ticket in respect of the current six months or, alternatively, had been the holder of a current financial ticket in respect of the 1mmed- iately preceding six months and was not more than one month in arrears as regards his contribution in respect of the current six months), he was entitled to vote in an election notwithstanding the fact that he was historically unfinancial in respect of some contribution for a past period. This mis- conception was not of recent origin. It had existed for a number of years. It was applied by the Returning Officer in relation to the conduct of the elections in question. Tt had been applied by Returning Oflicers in relation to their conduct of previous Queensland Branch elections. It was not, however, held by all members within the Branch and was not

universally applied in the conduct of the Branch elections

in question.

As has been mentioned, there are three districts within the Queensland Branch of the Union. The cvidence establishes that, 1n contrast to the approach adopted in the Southern and Northern Districts, historically unfinancial members in the Central District were excluded from the roll of persons entitled to vote in the elections and were not

accorded the opportunity of voting. The more than 1600

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historically unfinancial members who were accorded the opportun- ity of voting came from the Southern and Northern Districts

The explanation of the different approach which is to be

gleaned from the overall evidence 1s that a previous Secretary of the Central District had taken great care to ensure that the procedures followed within his District were in strict compliance with the Rules of the Union. The result of this disercpancy between the three districts was obviously to load percentage voting numbers in favour of the Southern and Northern Districts

at the exypense of the Central District.

Each of Mrs. Gall, Mr Belsham and another unsuccess- ful cand:date (Mr. Anear who was the retiring Branch President and a candidate for Branch Secretary) gave evidence that his or her v'derstanding of the Rules was, and at all relevant times had been, that a member was not entiticd to vote in the elections unless he was fully financial in accordance w.th the Rules in the scnse that he did not owe the Union any money in respect of past contributions and that it was not sufficicnt that he was merely the holder of a financial membership ticket in respect of the current or immediately preceding six months Each gave evidence that he or she believed that the elections in question would be and were being conducted on that basis. Mr. Anear and Mr. Belsham each gave evidence that the concuct of his campaign in the elections had been, to some extent, based on that belief. The evidence of these three witnesses was unshaken in cross examination. It should, in our view, be accepted. We also accept Mr. Anear's evidence that his

belief that the elections were being conducted in accordance

with his understanding of the cffect of the Rules was confirmed

by some unintentionally misleading remarks which had been made to him by Mr. John Munro, the Branch Returning Officer

for the elections in question.

Section 171C of the Act provides, for present purposes,

as follows:

"(L) An organization, a member of an ordaanisaaticn

or any person having a susfietent interest tn respeer of an organtzatton may opply to the Court for a determination of ine qrvestion whether an invalictty has occurred in the managenent or adninistratior of the organisation or of a branch of the orguniuacion

or tn an election or appotiniment tn, or the ran''ng

or alteration of the rules of, tne oraantratcsn oF a branch of the organtsatr~on and the Court has jurtsdietton to hear and determine tne aprireat.on

and to make such declaration as it thinks proper.

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the Court finds that an invulidtt referred to in that sub-seetion Court --

(2) Where, in proceedings under sub y

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(a) may make such order us it th rectify or causc +o be recti or to negattve, modify or ca tne consequences 1% Law of the in Calides, or

to validate any ael, matter or thing rer lercd invalid by ov as a result of the tinvalidit.;

(b) shall, before maxing such order, satisfy beets that such an order vould not do substant? injustice to the organizattun or to any menrLer or ereditor oF the organizutton or to any person haviny d ealinge with the organisation;

"

CC

The applicant plainly has a sufficient interest vo entitle him to bring the present application under s.171C. It 1s common ground that the giving of the opportunity 1» vote to the more than 1600 persons who were deemed to be unfinancial

members of the Union by virtue of the provisions of Rule 10

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and the taking into account of the votes of such of those Members as, in fact, voted involyed the occurrence of "an invalidity ... in an election" within the meaning of those words as used 1n s.171C(1). The essential questions involved in the present proccedings are whether the circumstances are such that 1t 1s appropriate that in order rectifying the invalidity or negativing or modifying the consequences of the anvalidity should be made and whether the Court 1s satisficd that such an order, if otherwise appropriate, would not do

substantial injustice to any membcr of the organization.

It was submitted, on behalf of the applicant, that the circumstances were clearly such as to make 1t appropriate and desirable that an order be made negativing any consequences of the invalidity in question and that such an order could not invclve injustice to any person. The applicant, under- standably, placed considerable emphasis on the fact that the relevant breach of the Rules was the result of a wide-spread and long-established misconception and did not involve any element of dishonesty or conscious disregard of the requirements of the Rules. It was also submitied, on behalf of the applicant, that the relevant breach of the Rules produced, in the circum-— stances, a result which was both more reasonable and more Lair than would have been the case if the Rules had been strictly observed in the relevant respect. In this regard, 1t was submitted thal a recent purported amendment to the Rules olf the Union aimed at ensuring that, in future clections, currently financial but historically unfinancial members would be given

the opportunity of voting indicated that this was a view which

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enjoyed strong support within the Union. It was further sub- Mitted that the purported amendment of the Rules in question was relevant in the sense that any new elections resulting from the refusal of the Court to make an order in the present proceedinzs would be held in accordance with the procedure adopted ja the disputed elections. We have referred to the relevant "amendment" to the Rules as/"purported amendment" for the reason that the respondents submitted that the amcnd- ment in question had never been validly effected to the Rules and there is plainly much force in that submission. We shell

however, jor the purposes of the present application, assume

that such amendment was validly effected.

There 1s, 1n our view. considerable force in the applicant's submission that it was, in the circumstances wiuich existed, both fair and reasonable, as an abstract proposition, that members who were currently financial but historically unfinancial should be given the opportunity of voting on the elections. Levels of employment in the industry in which members of the Union are engaged have historically varied both on an absolute and seasonal basis. The Queensland Branch has, in many instances, adopted the approach that a member who has failed to pay his contribution in respect of a past period when he was not employed in the industry should, even though he had not obtained a clearance ticket (under Rule 39) in respect of that period, be issued with a current financial ticket upon his resumption o! work in the industry and payment of the contribution in respect of the current period. Strictly

speaking, 1t would seem to be a breach of the Rules (Rule 6(1)

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and RuJe 10) for a current financial ticket which, on its

face, proclaims the holder's entitlement to the privileges

of membership, to be issued to a rember in these circumstances. Once the ticket has been issued however, 1t iS apparent that the holder of 1t would be likely to assume that the proviszons of Rule 10 were not operative so as to deem him to be un- financial and to exclude him from "all the privileges ... of

membership".

On the other hand, as has been said, the members of the Queensland Branch of the Union were cntitled, as a matter both of law and justice, to assume that the clections of the office holders in the Branch would be conducted in accordance with the Rules prescribing the manner in which such represent-— atives were to be elected. Those standing for office in the Union were, as a matter of law and justice, entitlicd to have the success or failure of their candidature determined 1a accordance with those Rules. It may well be that, if the opportunity to vote had not been extended to the more than 1600 historically unfinancial members, one or both of the two respondents or one or more of the other unsucccssiul candidates would have been successful. What 3s clear 1s that the un- successfui candidates have been deprived of the opportunity of having the success or failure of their candidature deter- mined in accordance with the relevant provisions of the Rules

of the Union.

In these circumstances, 1t cannot, in our view, he said that considerations of what 1s fair and just make 1t

appropriate that an order rectifying the relevant invalidity

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or negativine or modifying its consequences should be made.

Nor, inqr view, could the Court proverly be satisfied that

such an order, even 1f otherwise appropriate, would vot do substantinl injustice to any mesber of the orraninetion. Such

an order would aenprive the unsuccessful candidates, 1 an c.cction whilen 1s the subject of a suvsisting cnallenre in au election anquary, -£ the opportunity of ever havang their candidature

to hold office "uring the four vear period to waich the elect- atom relate determined in accorcanze with the Rules thich were properly appilcable to cetcrmius che success or failure of their candiuature. Such an o1cer pould be designee to acuieve

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the consequence tant the resronuc ts and Vr. fucar (and possibly, otner uusuccessful ca:didates) 1.¢cre bound by the results of aa clecticn in whic! they were candicatcs and in

whica the ground rules had, witheut their kucewlecre, Leen

wwrolerlLy alterea,.

In the circumstances. a caeclaration pursraut te 171C(1) of the occurrence of the invalicity should be rinde ang au order rectifying tant invalidity or nepativing, or

rmouifyipeg the consequences of it should be refusec,

I certify that this and the twelve preceding pages are a true copy of the Reasons for Judgment herein of their Honours Mr. Justice J B.

Sweeney, Mr. Justice Keely and Mr.

Justice Deane th b bstivctpe

ASSOCLATR

Dated' 4°, &. 7¢