Australasian Meat Industry Employees Union v Mudginberri Station Pty Ltd

Re: AUSTRALIASIAN MEAT INDUSTRY EMPLOYEES UNION; JACK O'TOOLE; TREVOR
SURPLICE; DICK ANNEAR and PAT ROUGHAN
And: MUDGINBERRI STATION PTY. LIMITED
No. G193 of 1985
Constitutional Law
13 IR 395

COURT

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION
Keely J.
Sheppard J.
Pincus J.

CATCHWORDS

Constitutional law - corporation and industrial powers - whether s. 45D of the Trade Practices Act 1974 invalid in so far as it purorts to apply to the conduct of industrial organizations engaged in for the purposes of pursuing an industrial claim - whether the corporations power, read in conjunction with the industrial power, extends to authorizing legislation prohibiting conduct by organizations which has the effect of, or is likely to have the effect of, causing loss or damage to the business of a corporation.

The Constitution, ss. 51(xx). 51(xxxv. 122

Judiciary Act 1903, ss. 78A. 78B

Conciliation and Arbitration Act 1904

Trade Practices Act 1974, ss. 6. 45D

Trade Practices (restrictive) - existence of purpose of damaging corporation's business - whether look only at ultimate purpose - conduct related to claim for introduction of "tally system" - whether good defence - persons acting "in concert with each other" - whether mental support enough - relevance of law of conspiracy - whether enough to show defence existed at inception of proceedings - whether former employees are "employees" under s. 45D(3) of Trade Practices Act 1974.

Trade Practices Act 1974, ss. 4. 45D. 75B. 80

HEARING

SYDNEY
#DATE 10:9:1985

ORDER

1. The appeal be dismissed.

2. The appellants pay the respondent's costs of the appeal.

NOTE: Settlement and entry of orders is dealt with in Order 36

of the Federal Court Rules.

JUDGE1

Keely and Pincus JJ.: This appeal was listed for hearing on 22 August 1985. Ground 14 of the amended notice of appeal is as follows:-

"That insofar as s.45D(1) of the Trade Practices Act 1974 purports to apply to organisations registered under the Conciliation and Arbitration Act 1904 it is beyond the power of the Commonwealth."

When the matter was called on for hearing, it was found that such notice as had been given to the Attorneys-General of the Commonwealth and of the States and the Northern Territory pursuant to s.78B of the Judiciary Act 1903 neither adequately specified the point to be raised nor gave sufficient time. The Court, therefore, directed that a proper notice under the section be given and stood over the argument on ground 14 until 4 September 1985. The notice given has resulted in the intervention, by counsel, of the Attorney-General of the Northern Territory. The Attorney-General of New South Wales appeared by solicitor, but did not wish to take part in the proceedings. There was no appearance of any other Attorney-General.

On 22 August 1985 the Court was unable to proceed to hear the argument in relation to ground 14, but it heard counsel for the appellants on all other grounds relied upon by them, that course being permitted by s.78B(2)(c) of the Judiciary Act. On 23 August 1985 the hearing was adjourned to 4 September 1985. Argument then proceeded on the constitutional question and the hearing of the appeal concluded on 5 September 1985. Ms Simpson appeared on behalf of the appellants to argue the grounds other than ground 14 and Sir Maurice Byers Q.C., with whom Mr Robertson appeared, argued the constitutional points for them.
The appeal is against a judgment of Morling J. given on 12 July 1985 making orders under s.45D of the Trade Practices Act 1974. They restrained the present appellants from continuing to maintain a picket line at the respondent's premises. It appears from the evidence that the history of the matter is, in summary, as follows. In 1973 there was established an abattoir and export meat processing operation at Mudginberri in the Northern Territory. The respondent, whose name was then Buffalo United Farmers Pty Ltd, was incorporated in 1981 and subsequently began to operate the business. In 1984 the third appellant, the Northern Territory organiser of the first appellant, ("the union"), visited the premises several times with a view to introducing a "tally system" of payment of persons working there, along the lines said to be established by the Queensland Meat Industry Award. Such a system had not previously been used in the Northern Territory. About the same time the second appellant, the federal secretary of the union, told Mr Pendarvis, a director of the respondent, that unless the tally system was accepted by the respondent it would not be able to operate. In support of the purpose of forcing the introduction of a tally system, the union set up a picket line at the premises of the respondent in July 1984. The Conciliation and Arbitration Commission came to Darwin in August 1984 to hear an application by the union for an award relating to, inter alia, employees at the premises of the respondent; the Commission declined to hear the application until removal of the picket line and its removal was brought about under a written agreement between the union and other interested parties, by which the union and its members also promised not to take further industrial action pending the making of an award and committed themselves "to accept and work to any such award".
The award was made on 29 April 1985. Clause 33, the terms of which it is not necessary to set out in full, permitted an employer (including the respondent) to remunerate employees under a system of payment by results, with the proviso that the employees had to be able to earn, under that system, not less than 20 per cent more than they would have been entitled to under the other provisions of the award. The clause required the terms of any system of payment by results to be established "by negotiation and agreement between the employer and the majority of employees concerned, or their nominated representatives". According to the evidence of Mr Pendarvis, who was found to be a reliable witness, the third appellant (who, as has been mentioned, was the Northern Territory organiser of the union), told him shortly before the award was made that the union rules had been changed so as not to permit the employees to negotiate for themselves; it was said that under the rules in their amended form the employees could negotiate only through the union. That notwithstanding, representatives of the employees negotiated with the management of the respondent and reached an agreement on 6 May 1985 pursuant to Clause 33 of the award, providing for payment by results.
The respondent planned to begin the season's slaughtering and processing on 9 May 1985 and some animals were slaughtered on that day, but the following day the picket line complained of in the proceedings was established at the entrance to the respondent's premises and it remained there, despite restraining orders made by judges of this Court. What might be called the wider purpose of its establishment was the subject of some debate, but there can be no doubt about its immediate purpose: it was intended to, and did in fact, damage the business of the respondent in a number of ways. Of these the most important was that it kept out of the respondent's premises inspectors qualified to oversee slaughtering and processing operations with respect to meat for export. On the evidence, the damage caused to the respondent has been very considerable. Further, there could be no serious dispute that the occurrence of such damage was within the contemplation, indeed the plans, of the appellants; for example, there was evidence that in September 1984 the fourth appellant, the president of the union, made remarks in the presence of Mr Pendarvis to the effect that he (and others) would be out of business by the following year. When asked what he meant by that the fourth appellant said among other things: "You bastards have had it your own way in the past but we are going to close you down." There was also evidence, which his Honour accepted, that the fifth appellant, the national organiser of the union, threatened the use of physical force to prevent the inspectors working if they crossed the picket line.
Notwithstanding evidence of that kind and the finding of the learned trial judge, it was contended by counsel on behalf of the appellant that the order made was wrong in law, in that it was not shown that there was such a purpose as that spoken of in s.45D(1) of the Trade Practices Act. That sub-section reads, so far as relevant, as follows:-

"Subject to this section, a person shall not, in concert with a second person, engage in conduct that hinders or prevents the supply of goods or services by a third person to a fourth person (not being an employer of the first-mentioned person), or the acquisition of goods or services by a third person from a fourth person (not being an employer of the first-mentioned person), where -

(b) the fourth person is a corporation and the conduct is engaged in for the purpose, and would have or be likely to have the effect, of causing -

(i) substantial loss or damage to the business of the fourth person or of a body corporate that is related to that person; or

(ii) a substantial lessening of competition in any market in which the fourth person or a body corporate that is related to that person supplies or acquires goods or services."

The basis of this first contention on behalf of the appellants was that, even if they had the immediate purpose of damaging the business of the respondent, it should have been held that their real purpose was to force the introduction of a tally system. In support of the argument, counsel pointed to the finding of the learned primary judge with respect to the defence raised under s.45D(3) (discussed below), namely that the maintenance of the line "is related to the general policy of the union that all meatworkers in the Northern Territory should be paid according to the tally system notwithstanding the terms of the award handed down ..."
There is, however, no inconsistency between that view and his Honour's finding that the purpose spoken of in s.45D(1) existed. The appellants were deemed to engage in a s.45D(1) purpose if they engaged in conduct for purposes that included a s.45D(1) purpose; section 45D(2) reads as follows:-

"Paragraph 4F(b) does not apply in relation to sub-section (1) or (1A) of this section but a person shall be deemed to engage in conduct for a purpose mentioned in that sub-section if he engages in that conduct for purposes that include that purpose."

It is unnecessary to make further reference to par. 4F(b).

The purposes of the appellants, on the facts outlined above, at least included a s.45D(1) purpose. In most, if not all, of the reported cases in which an injunction has been granted under s.45D, the persons enjoined had, in addition to the immediate purpose of damaging the applicant's business, a further purpose of achieving a modification in the applicant's conduct, or in the conduct of some other person. An example, the facts of which are in some respects similar to those in the present case, is to be found in the decision of this Court in Tillmanns Butcheries Pty. Ltd. v. AMIEU (1979) 42 FLR 331. In our opinion, the evidence accepted by his Honour plainly established that the appellants had, at least as one of their purposes, the purpose of causing substantial loss or damage to the respondent's business. The appellants' first argument therefore fails.
The learned trial judge thought, and it seems clearly to be right, that the real defence raised was that under s.45D(3)(b) which provides:-

"A person shall not be taken to contravene, or to be involved in a contravention of, sub-section (1) or (1A) by engaging in conduct where ...

(b) in the case of conduct engaged in by the following persons in concert with each other (and not in concert with any other person), that is to say -

(i) an organization or organizations of employees, or an officer or officers of such an organization, or both such an organization or organizations and such an officer or officers; and

(ii) an employee, or two or more employees who are employed by the one employer,

the dominant purpose for which the conduct is engaged in is substantially related to -

(iii) the remuneration, conditions of employment, hours of work or working conditions of the employee, or of any of the employees, referred to in sub-paragraph (ii); or

(iv) the employer of the employee, or of the employees, referred to in sub-paragraph

(ii) having terminated, or taken action to terminate, the employment of any of his employees."

Counsel for the appellants correctly conceded that the onus of establishing the existence of the circumstances set out in this provision was on the appellants, who were respondents below. She did not challenge the primary findings of fact of the learned trial judge, but submitted that, nevertheless, his Honour had fallen into error.
For a defence based on s.45D(3)(b) to succeed, there must, as a starting point, be identified a person or persons falling within the description in sub-par. (ii): "An employee, or two or more employees who are employed by the one employer." The contention on behalf of the appellants was that Messrs V.P. Liddy, L.K. Payne and R.H. Byrne, all of whom gave evidence for the appellants, constituted a group of employees whose connection with the picket line made it lawful. The ultimate issue, as to this part of the case, may therefore be narrowed: the appellants must show, in order to succeed, that one or more of those three men was an employee, that (if two or more of them are to be considered) they acted in concert with each other and, lastly, that the dominant purpose of the conduct they engaged in was substantially related to one of the matters set out in sub-par. (iii) or (iv).
It is convenient to consider initially the question of acting in concert. Paragraph (b), set out above, requires that the persons whose participation, with the relevant purpose, constitutes the defence relied on engage in conduct "in concert with each other". It was argued by counsel for the appellants that the learned trial judge should have found that all of Messrs Liddy, Payne and Byrne so acted. Consideration of that submission requires further attention to the facts proved and found.
Messrs Liddy and Payne agreed to become employees of the respondent on 9 May 1985. Mr Liddy did so pursuant to a conversation with the respondent's general manager Mr Pearson who said to him: "I'll give you a trial run for a couple of weeks and see how you go." He in fact worked only on 9 May, joined the picket line on 11 May and left it on 12 May, when he went back to Darwin. He returned to the abattoir about a week later to repay some money he owed to employees of the abattoir and on that occasion stopped at the picket line and had a few drinks with those present there. He did not subsequently return to the picket line, nor does the evidence disclose that he took any active step which might be thought to have been in support of it. When the matter came before the learned trial judge, then, Mr Liddy had not been near the picket line for nearly two months, nor did he claim to have any intention of returning to it. The story of Mr Payne's involvement in the line was similar, in that after being engaged he was in the line on 9 and 10 May 1985 and left on the latter date. Mr Payne, unlike Mr Liddy, never came back.
It was contended on behalf of the appellants that, although neither of Messrs Liddy and Payne had been to the picket line, or done anything overtly in support of it, for about two months, they should have been taken by the learned trial judge to be still acting in concert with those who were in the line about the time the case was heard. The basis of this contention was not easy to follow, but it appeared to amount to the suggestion that because Messrs Liddy and Payne were still, in their own minds, in support of the aims of the picket line, as they rather vaguely understood them, they were still acting in concert with the picketers at the date of the hearing. It was pointed out that, for example, Messrs Liddy and Payne had given evidence in the case and in this way signified their support.
It is true that s.4(2) of the Trade Practices Act gives a broad definition of engaging in conduct, and the expression is defined in such a way as to include "refraining (otherwise than inadvertently) from doing" an act. It does not follow, however, that a mere inclination towards, or sympathy with, the cause of those in the picket line is action in concert with them. The consequence of the view advanced on behalf of the appellants is that a picket line, made lawful in its inception by the participation of employees, must remain lawful indefinitely by operation of s.45D(3)(b) even if the relevant employees have long departed, so long as they mentally adhere to their original stance. It would seem to follow that such a line might become unlawful if the absent employees changed their minds, without any overt action on their part. These consequences are so strange that the suggested construction of par. (b) should not be adopted in the absence of compelling language. There is no such language; mere mental support, without any current overt participation, does not amount to engaging in the sort of conduct mentioned in s.45D(3)(b). It should be added that counsel for the appellants contended, rather faintly, that the fact that Messrs Liddy and Payne gave evidence could be taken into account in determining whether they continued, at the date of hearing, to act in concert with the pickets; it is enough to say that giving evidence in a s.45D case cannot possibly be conduct of a kind prohibited by s.45D(1) or saved by s.45D(3).
It follows that neither Mr Liddy nor Mr Payne was at the date of hearing acting in concert with any picketer. In particular, they were not acting in concert with Mr Byrne, whose connection with the picket line did not begin until long after theirs had ceased. Mr Byrne was engaged on 3 May 1985 as the manager of the abattoir, at a salary. He left his employment on a date which was not clearly proved. It was stated by him to be about two weeks after the picket line "was up", which would make the date of his departure about 23 May 1985. He also said, however, that he left about two months after he had started. Lastly, he seemed to agree that he left his job on 18 June 1985, which is inconsistent with each of the other accounts.
Whatever may be the truth about the date he left his employment, Mr Byrne said that he spent five days on the picket line, having left it four days before the hearing. It appears, then, that he was on the picket line from about 1 to 6 July 1985. He did not suggest that he had any contact with Messrs Liddy and Payne during their brief stay on the line, nor that they had any connection with his own stay. While Messrs Liddy and Payne were on the line in May, Mr Byrne was, on any view of his evidence, employed as manager of the abattoir and there is no suggestion that he then gave any support to the picket line.

The notion of acting in concert involves contemporaneity. So much is clear from the phrase itself and it is also implicit in the remarks of Bowen C.J. in Tillmanns Butcheries Pty. Ltd. v. Australian Meat Industry Employees Union 42 FLR 331 at p 337:-

"Acting in concert involves knowing conduct, the result of the communication between the parties and not simply simultaneous actions occurring spontaneously."

That each of Messrs Liddy, Payne and Byrne had, although at different times, a connection with the same picket line does not establish that at any time they were acting in concert with each other.

It was argued on behalf of the appellants that a charge of conspiracy may be made out against persons who have not all been in touch with each other (see Smith and Hogan's Criminal Law, 5th ed. p.247) and that, similarly, the three men might be shown to have acted in concert because Messrs Liddy and Payne so acted with others on the picket line and Mr Byrne, separately, acted in concert with those on the picket line. But the application of the expression "in concert" in the sub-section in question does not necessarily have anything to do with whether the persons concerned conspired together. Exculpation under s.45D(3) does not depend upon principles derived from the law of conspiracy on which counsel for the appellants relied; it depends upon the natural meaning of the language used. The sub-section requires that the persons mentioned act in concert with each other, not that each act in concert with a third person. It should be noted that the law of conspiracy may be relevant to the question whether a person has been involved in a contravention of s.45D - see s.75B(d) - and may be the basis for the grant of an injunction under s.80(1)(j), but it does not provide any assistance in construing the expression "in concert with each other" in par. (3)(b) of s.45D.
It follows that Messrs Liddy and Payne were at no time acting in concert with Mr Byrne. The three cannot be considered as a group of employees for the purposes of sub-par. (b)(ii). Each of Messrs Liddy and Payne, on the one hand, and Mr Byrne, on the other, must be considered separately to determine whether either supports the defence under par. (3)(b).
The difficulty about reliance upon Messrs Liddy and Payne is, of course, that their connection with the picket line ceased in May, well before the hearing. Indeed, it was not shown, as to either of them, to have continued even up to the date of the filing of the application to the Court, 24 May 1985. Counsel for the appellants argued, at one stage, that that was the critical date at which the existence of the defence had to be determined. Assuming that to be so, it was not demonstrated that Messrs Liddy and Payne, or either of them, then acted in concert with those on the picket line. It is therefore not really of any importance, for the purposes of this case, to determine whether the contention that it is enough for the appellants to show a good defence at the date of commencement of the application is correct. Nevertheless, we propose to state our view of the submission. In our opinion, it is plainly incorrect. The Court has jurisdiction to grant an injunction to restrain a breach of s.45D even if no breach has occurred at the date of inception of the application - indeed, even if no breach has ever occurred - as long as it is shown that, if no injunction is granted, it is likely that a breach will occur: s.80(4).
It is clear, therefore, that the activities of Messrs Liddy and Payne cannot be relied on as constituting a defence to the application, or a basis of attack upon the correctness of the orders of the learned trial judge. That leaves the question whether the presence of Mr Byrne on the picket line, shortly before the hearing, should have caused his Honour to hold that the conduct of the appellants was not then in breach of s.45D and refuse an injunction on that ground. It was conceded, however, and correctly, that Mr Byrne, considered as the sole employee engaged in concert with those on the picket line, could not underpin a par. 3(b) defence. The reason is that the picket line had no purpose related to the remuneration, conditions of employment or the like of Mr Byrne, within the meaning of sub-par. (iii), nor did it have anything to do with termination of Mr Byrne's employment under sub-par. (iv).
The conclusion up to this point, then, may be summed up by saying that the three employees relied on by the appellants were not engaged in conduct in concert with each other because two of them acted in May and the other in July; the first two could not provide a defence, because they abandoned the picket line before the proceedings began and the third could not provide a defence because the purposes of the picket line had nothing to do with his employment.
That is enough to determine the result of the appeal as to all the issues other than those arising under the Constitution, but it should be added that if Messrs Liddy, Payne and Byrne acted in concert with each other, as asserted, about the date of hearing, the defence under par. 3(b) still fails. That is so because Messrs Liddy and Payne were not then employees. The learned trial judge found that they were not and the finding was not challenged; each of them had left his job, had been replaced by the abattoir management and had taken other employment. It is true that there was no evidence of any formal resignation, but they had repudiated their contracts of employment and the employer had replaced them and thus accepted the repudiation.
Counsel for the appellants contended that nevertheless they remained "employees" within the meaning of sub-par. (ii) of par. 3(b). Two reasons were given. Firstly, it was said that to hold otherwise could lead to an absurdity, for an employer could simply dismiss employees whose presence made a picket line lawful, thus rendering it unlawful. Secondly, counsel argued that at least in sub-par. (iv), referring to termination of employment, the word "employee" is used as having reference to a former employee, one who has been dismissed.
These contentions go to support the view that conduct substantially related to termination of employment may be lawful under par. 3(b) even if the only "employees" engaged in the conduct are the very ones whose employment has been terminated. Here, the conduct enjoined has nothing to do with termination of employment and it is unnecessary to determine whether the contention just mentioned is correct. Whether it be so, or not, it is going too far to say that the references to "employee" and "employees" in sub-par. (ii) cover all ex-employees. Counsel sought to avoid the absurdity of that conclusion by suggesting that at least former employees who have voluntarily left their jobs to engage in picketing are intended to be included in sub-par. (ii). But it is plainly impossible to make such an elaborate qualification of the plain language of sub-par. (ii) and the submission must be rejected.
It follows that for an additional, independent, reason, the defence fails: two of the three persons whose conduct about the date of hearing was relied on were not "employees" within the meaning of par. 3(b)(ii), at that time. Therefore, if they were (contrary to the view expressed above) acting in concert with those on the picket line at that stage, their presence did not support, but instead destroyed, the defence relied on. That is so, because of the words in brackets at the beginning of par. (b): "and not in concert with any other person". It should be added, for the sake of completeness, that although the question whether Mr Byrne was an employee at the time he was on the picket line was but little debated, there is on the face of it no reason to interfere with the view of the learned primary judge that he was not.
Apart from the matters so far mentioned, the main basis on which the judgment of the learned primary judge was supported was that his Honour was correct in finding, as he did, that neither the persons on the picket line, in general, nor Messrs Liddy, Payne and Byrne, in particular, were engaged in conduct substantially related to the matters mentioned in sub-par. (iii). Because of our conclusion on the other matters argued, we do not find it necessary to express an opinion on that point. The only other matter with which we propose to deal is the constitutional issue.
Sir Maurice Byers Q.C., on behalf of the appellants, contended that for constitutional reasons s.45D had to be read down so as not to prohibit such conduct as was found to have been engaged in. The argument depended upon the presence in s.51 of the Constitution of par. (xxxv):-

"Conciliation and arbitration for the prevention and settlement of industrial disputes extending beyond the limits of any one State:"

It was said that the union, the first appellant, is an organisation constituted pursuant to statutory authority under par. (xxxv), that a principal purpose of the establishment of such bodies is to enable the making of claims or demands such as that mentioned in the evidence in this case, namely the claim or demand for a tally system, and that Parliament may not lawfully inhibit that activity in the way provided by s.45D. Treating the constitutional foundation of s.45D as being the corporations power, set out in par. (xx) of s.51 of the Constitution, counsel for the appellants contended that the scope of that power must be determined having regard to the whole of the Constitution, including par. (xxxv) set out above. He submitted that it would be inconsistent with the object of the grant of power in par. (xxxv) to read par. (xx) widely enough to support legislation prohibiting the actions of the union enjoined by the learned primary judge. Counsel particularly relied upon a dictum of Mason J. in R v. Sweeney; ex parte Northwest Exports Pty. Ltd. (1981) 147 CLR 259 at p 273:-

"Parliament cannot impose prohibitions or limitations on a registered organisation which are inconsistent with the object of the legislative power, that is, the prevention and settlement of interstate industrial disputes by conciliation and arbitration."

This sentence appears in a discussion by Mason J. of the extent to which, pursuant to par. (xxxv) of s.51, Parliament may control organisations registered under the Conciliation and Arbitration Act 1904. It was not, as we read it, directed to the question whether legislation on that subject could be supported under any other power. Let it be assumed, however, that the dictum we have quoted should be read in the wider sense. Can it be said that the restraint on activity of registered organisations imposed by s.45D is inconsistent with the prevention and settlement of interstate industrial disputes by conciliation and arbitration? Obviously, those objects may be achieved without engaging in conduct of the kind mentioned in s.45D. Only where there are both a purpose and an actual or likely effect of causing the consequences set out in s.45D(1) does the provision have any operation at all; those consequences are, to put it briefly, substantial loss or damage to a business or substantial lessening of competition in a market. Further, many varieties of industrial action having the purpose and effect of, for example, causing substantial loss or damage to an employer's business are excluded from the prohibition imposed by the section, by the operation of sub-s.(3), aspects of which are discussed above.

It was contended on behalf of the appellants that sub-s.(3) is too narrow to save the validity of the provision, in its application to activity of industrial organisations of the kind in issue in the case. The argument did not go to the length of contending that Parliament has no power to inhibit, or make unlawful, steps taken by a registered organisation in pursuit of an industrial aim, such as the introduction of a tally system. It did not appear to be suggested that Parliament cannot protect other members of the community from such steps if they are calculated to cause damage to person or property. Accepting Parliament's right to pass legislation of that general kind, it was contended, in effect, that the Court should hold that Parliament had gone too far.
Using the test suggested, that of inconsistency with the object of prevention and settlement of certain industrial disputes by conciliation and arbitration, we cannot see any possible ground for contending that there is an inconsistency. Plainly, the process of prevention and settlement of such disputes, as well as that of conciliation and arbitration, may be engaged in to the full despite the restraints imposed by s.45D. We can see nothing express or implicit in par. (xxxv) imposing a constitutional limit on Parliament's power to control activity of the kind dealt with in s.45D. It is clear, as counsel for the appellants accepted, that Parliament may prohibit strikes in pursuit of industrial disputes (Stemp v. Australian Glass Manufacturers Co. Ltd. 23 CLR 226) and that is a wider constraint on registered organisations than that imposed by s.45D.
No occasion arises, then, to determine the correctness of the assumption which underlies the whole argument, namely that the corporations power, par. (xx) of s.51, may be read down by implication from the conciliation and arbitration power, par. (xxxv). We are not to be taken as expressing any view on that, for we are of opinion that, regarding s.45D as supported by par. (xx), there is no conflict with par. (xxxv).
Mr Sheller Q.C., counsel for the Attorney-General of the Northern Territory, put forward two further reasons in favour of the view that no question of invalidity such as that just considered arises. He submitted that the point is concluded against the appellants by the decision of the High Court in Seamen's Union of Australia v. Utah Development Co. (1978) 144 CLR 120 and Actors and Announcers Equity Association of Australia v. Fontana Films Pty. Ltd. (1982) 150 CLR 169. It was also submitted that no question of the scope of par. (xx) of s.51 arises, because s.45D has sufficient support, for the purposes of this case, from s.122 of the Constitution. In the circumstances, we do not find it necessary to determine the correctness of either submission.
The appeal must be dismissed. The appellants must pay the costs of the respondent.

JUDGE2

Sheppard J.: In this matter I have had the advantage of reading the judgment to be delivered by Keely and Pincuss JJ. I agree in their conclusion that the appeal should be dismissed. I agree also with their reasons for rejecting the appellants' submissions made in relation to the grounds other than that impugning the validity of s. 45D of the Trade Practices Act 1974 insofar as it purports to extend to conduct engaged in by organizations registered under the Conciliation and Arbitration Act 1904. I do not wish to add anything to what they have said in in that respect.

As to the ground based on the invalidity of s. 45D, I agree generally with what the other judges have said so far as concerns legislation owing its validity to the corporations power (s. 51(xx) of the Constitution) not being capable of affecting the conduct of organizations if that conduct is engaged in in relation to the pursuit of an industrial claim. But there are some matters which I wish to add for myself.
It was submitted on behalf of the appellants that inherent in the power conferred on Parliament by s. 51(xxxv) of the Constitution was what was described in the submission as "Parliament's incapacity to impose prohibitions or limitations on groups of employees", whether existing as a registered organization or not, inconsistent with the objects of the legislative power. It was submitted that the claim by the Union in this case was that the respondent's employees should be paid their wages in accordance with the tally system. The claim was, or was part of, an industiral dispute within s. 51(xxxv). The pickets were said to be the means by which this claim was asserted. It was then said that s. 45D of the Trade Practices Act operated by reference to persons and the conduct of one person with a second person. Such operation was said to be "apposite to apply to individuals as members of a group or to the group existing as body corporate." Section 45D, in its application to the circumstances of the present case, was a law made under s. 51(xx) of the Constitution, that is under the corporations power. It was common ground that the organization was not a corporation of a kind to which s. 51(xx) applied. The Constitution must be read as a whole so at to reconcile the various parts of s. 51. So read, s. 51(xx) did not extend to authorize laws destructive of the grant of power in s. 51(xxxv).
The foundation for the appellants' argument was a dictum of Mason J. in The Queen v. Sweeney; Ex parte Northwest Exports Pty Limited (1981) 147 CLR 259. Amongst other things Mason J. said (pp. 272-273):-

"It is trite law that s. 51(xxxv.) enables the Parliament to provide for the incorporation and registration of organizations of employers and employees as a means of facilitating the prevention and settlement of interstate industrial disputes. In providing for the registration of organizations Parliament may regulate their constitutions and their affairs ... In Reg. v. Bowen; Ex parte Amalgamated Metal Workers' and Shipwrights' Union Gibbs J..with whom Barwick C.J., Aickin J. and I agreed, noted Fullagar J.'s statement that Parliament can define the powers of registered organizations (Williams v. Hursey (1959) 103 CLR 30, at p

(68) and referred to the comments made by Isaacs and Starke JJ. in Australian Commonwealth Shipping Board v. Federated Seamen's Union of Australasia (1925) 36 CLR 442, at pp 453, 463 that Parliament's power to regulate the affairs of registered organizations is very wide, and to the approval of these observations in Reg. v. Spicer; Ex parte Australian Builders' Labourers' Federation (1957) 100 CLR 277 at pp 288-289, 294-295, 309."

Mason J. then quoted a passage from the judgment of Gibbs J. (as he was) in The Queen v. Bowen; Ex parte Amalgamated Metal Workers' and Shipwrights' Union (1980) 144 CLR 462 and continuted (pp. 273-4:-

"Parliament cannot impose prohibitions or limitations on a registered organization which are inconsistent with the object of the legislative power, that is, the prevention and settlement of interstate industrial disputes by conciliation and arbitration. But, subject to the Constitution, Parliament can in my opinion prohibit or inhibit a registered organization from engaging in activities which are or may well be detrimental to the object of the constitutional power or are immaterial to that object, whether it does so by denying capacity to organization or by prohibiting it from engaging in certain activities."

The extent to which the powers of industrial organizations may be regulated or restricted has been the subject of attention in a number of decisions of the High Court. It was early held that provisions contained in the Conciliation and Arbitration Act 1904 prohibiting an organization "on account of any industrial dispute" from engaging in a lock-out or strike, or continuing any lock-out or strike, were valid; Stemp v. Australian Glass Manufacturers Co Limited (1917) 23 CLR 226. There Isaacs J. said (pp. 239-40):-

"Just as a Bankruptcy Act can punish fraudulent trade dealings entered into before the act of bankruptcy, so a compulsory Arbitration Act can prohibit force anterior to the actual initiation of proceedings. The existence of the dispute is the cardinal fact which attracts the power of the Parliament to apply to it the remedy of conciliation or arbitration as the single remedy consonant with the welfare of the Commonwealth, and to enforce its will in that respect. It is quite consistent with compulsory arbitration in disputes to leave the one door of friendly settlement open, whether it is reached by purely spontanious and unaided action of the disputants themselves or with the assistance of a conciliator, so that by one or other means reconciliation has ended the dispute, and at the same time to leave open no other door but that leading to the equally peaceful arbitrament of the public arbitrator, should reconciliation be impossible. The parties may mutually agree to end their dispute, and, it so, there is nothing to arbitrate upon; but, if they cannot do that, then, if Parliament so determines, they must resort to law, and, if they are compelled by law to resort to law, it necessarily connotes that they cannot lawfully resort to force. This is not a mere figure of speech: force is the recognized attribute of the remedy by 'strike' or 'lock-out.'"

The emphasis is that of Isaacs J.

Higgins J. expressed similar views. Amongst other things, he said (pp. 244-245):-

"When one party has a decided advantage over the other, it is very hard to get an agreement by the process of conciliation; what induces the agreement is the knowledge that there is a compulsory power of arbitration in reserve. This is the kind of pressure that the Act contemplates. But if the stronger party feel that he can still use the economic pressure of 'strike' or 'lock-out,' as the case may be, this counter pressure nullifies, or tends to nullify, the pressure of the tribunal. The tribunal must be unconstrained, free to award what seems to be just and right; and it must not be left to fear that if the stronger side do not get what it wants, it will take it - by stoppage of work, or by closing the works. Anyone who is at all familiar with the working out of problems under the Act must know that the two methods of strike and reason, of might and of right, cannot operate together. Silent leges inter arma; and so, too, if economic pressure is to be used, the processes of the tribunal will generally be futile. By prohibiting attempts to settle a dispute by economic pressure, you clear the ground for settlement by reason, on the lines of what is right and just."

Provisions of the Conciliation and Arbitration Act prohibiting lock-outs and strikes were repealed many years ago. But the importance of what Isaacs and Higgins JJ. said is that it underlines the purview and intendment of the legislative power conferred by para. (xxxv) of s. 51 of the Constitution. What is contemplated is prevention or settlement of industrial disputes by peaceful means without resort to direct action. In passing it may be noted that that philosophy continues to underlie the Conciliation and Arbitration Act. Section 25 provides that as soon as an organization or an employer becomes aware of the existence of an industrial dispute affecting the organization or its members or affecting the employer, as the case may be, the organization or employer shall forwith notify the relevant Presidential Member, or the Registrar. Reference may also be made to s. 188 f the Conciliation and Arbitration Act which creates a number of offences which may be committed by organizations, whether of employers or employees.
To the same effect as the dicta of Isaacs and Higgins JJ. in Stemp's case is what was said by Gibbs J. in The Queen v. Bowen (supra) in the passage from his judgment quoted by Mason J. in the Northwest Exports case. That passage - I have quoted a little more than did Mason J. - was as follows (144 C.L.R. at pp. 471-2:-

"The power to regulate the activities of an organization registered under the Act is not limited to those activities which relate to an existing or threatened interstate dispute or to work done under an existing federal award. Such an organization is not brought into being by the Act to do whatever iut wishes. It can only be created to further the purpose statd in s. 51(xxxv.). The Parliament can validly prevent organizations fromed for that purpose from engaging in activities alien to or unconnected with it. It is neither necessary nor desirable to attempt to define the limits (if any) to the power of the Parliament to regulate organizations of this kind. Clearly however the Parliament has power to prevent them from engaging in industrial activity which does not conduce to the prevention and settlement of industrial disputes by means of conciliation and arbitration. It can, for example, prevent them from fomenting industrial strife, even though no interstate dispute is threatened or pending and no federal award is in question. It clearly has power to prevent them from engaging in activities of the kind described in s. 188(1)."

As Mason J. noted, Gibbs J.'s judgment was agreed in by Barwick C.J. (p. 466), Mason J. himself (p. 473) and Aickin J. (p. 481).
What Mason J. said in the Northwest Exports case must be read and understood against this background. The industrial power itself authorizes Parliament, if it chooses to do so, to impose fetters on direct action, notwithstanding that it is direct action taken in pursuance of an industrial claim.
Central to the appellant's argument was the submission that the grant of legislative power in s. 51 of the Constitution to make laws in respect of the subject matters specified in its various paragraphs was to be read subject to certain of the powers being read down to accommodate restrictions which appeared from the terms in which other grants of power were made. The most obvious example is to be found in the operation of para. (xxxi) which provides for the making of laws with respect to the acquisition of property on just terms. Plainly Parliament may not, pursuant to its powers to legislate, for example, in respect of banking, provide for the acquisition of property otherwise than on just terms; see Bank of New South Wales v. The Commonwealth (1948) 76 CLR 1. In relation to para. (xxxi) reference may also be made to Attorney-General v. Schmidt (1961) 105 CLR 361 per Dixon C.J. at pp 371-2. In Russell v. Russell one of the questions in issue concerned the extent of the grants of power conferred by paras. (xxi) and (xxii) of s. 51. These powers relate resectively to marriage and to divorce and matrimonial causes. But, so it seems to me, such limitations of power as have been found to exist have been found as a consequence of construing s. 51 of the Constitution as a whole and concluding that particular grants of power were not as plenary as may have been the case if regard were had only to the language of a particular paragraph of the section. The judicial disagreement which is to be found in Russell v. Russell arose because of a difference of view as to the proper interpretation of the two paragraphs in question, bearing in mind, on the one hand, the apparent relationshiop and connection between them and, uopn the other, the different subject matters to which they referred.
I do not find it necessary to reach a conclusion on whether the power conferred by para. (xx) - the corporations power - is subject to any limitation of the kind contended for by counsel for the appellants. That is because none of the conduct proscribed by s. 45D of the Trade Practices Act 1974 is conduct which an organization must be empowered to engage in in order to discharge its functions of propertly and adequately representing its members in ther pursuit of industrial claims, either by negotiation, or by resort to conciliation and arbitration. The authorities to which reference has been made establish that the power conferred by s. 51 (xxxv) was intended to be implemented by Parliament to enact laws encouraging and facilitating the settlement of industrial disputes by peaceful means; not by means which involve direct action in the form of strikes, bans or limitations.
The conduct which is prohibited by s. 45D is conduct which must involve either actual or threatened loss or damage to the business of a corporation. Unless that element is present, no breach of the section will be involved. Thus, such a provision, insofar as it applies to an organization, does not affect at all the organization's power to make and propound an industrial claim, nor to pursue such a claim by negotiation or, if it be rejected, in the proceedings before theCommission. What is prohibited is conduct in pursuance of such a claim which causes, or is likely to cause, substantial loss or damage to the corporation's business.
It follows that the submission relied upon by sounsel for the appellants must fail. There are, however, two other matters which sould be mentioned.
Counsel for the Attorney-General of the Northern Territory, who intervened pursuant to the provisions of s. 78A of the Judiciary Act 1903, submitted that the case was concluded against the appellants by the decisions of the High Court in The Seamen's Union of Australia v. Utah Development Company (1978) 144 CLR 120 and Actors and Announcers Equity Association of Australia v. Fontana Films Pty Limited (1982) 150 CLR 169. In the circumstances it is unnecessary to reach a conclusion on this submission.
Counsel for the Attorney-General of the Northern Territory also developed an argument, supporting the validity of s. 45D of the Trade Practices Act, based on s. 122 of the Constitution (the Territories power). He referred to sub-para. 6(2)(b)(111) of the Trade Practices Act which, so far as relevant, provides that the Act has, by force of the provisions of sub-sec. 6(2), the effect it would have if certain of the sections of the Act, including s. 45D were, by express provision, confined in their operation to engaging in conduct to the extent to which the conduct takes place in the course of or in relation to trade or commerce within a Territory. Because of the clear view I habe that the apellants' submission should be rejected on more general grounds, I do not need to deal with the question of whether the validity of s. 45D, insofar as it operates in a Territory, may also be supported by reference to the power conferred on Parliament by s. 122 of the Constitution to make laws for the government of the Territories.
In the result I would dismiss the appeal with costs.

[1985] FCA 456

10 SEPTEMBER 1985