Dobinson & Ors v Crabb

[1990] HCATrans 7

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Melbourne No M67 of 1988

Between-

VINCE DOBINSON. RON OWENS. JA..~ES

BACON, STEVEN BLACK, KEVIN REYNOLDS,

PETER O'DEA, NOR.MAN LESLIE GALLAGHER

and NORMAN WALLACE

Annellants ..

and

THE HONOUR.ABLE STEVEN M. CRABB

and IAN GORDON SHARP

First and Second Respondents

HER MAJESTY'S ATTORNEY-GENERAL

FOR THE STATE OF VICTORIA

Third Res~ondent

Removal pursuant to section 40

of the Judiciary Act 1903

BRENNAN J

Dobinson(2)

DAWSON J

TOOHEY J

GAUDRON J

McHUGH J

TRANSCRIPT OF PROCEEDINGS

AT CANBERRA ON TUESDAY, 13 FEBRUARY 1990, AT 10.16 AM

Copyright in the High Court of Australia

C2T2/1/RB 1 13/2/90

MR E.W. GILLARD, QC:  If it please the Court, I appear

with my learned friend, MR G. ANDERSON, QC, for the

appellants. (instructed by Slater & Gordon)

MR H.C. BERKELEY 1 QC, Solicitor-General for the State of

Victoria:  If the Court pleases, I appear with my

learned friends, MR R.R. TRACEY and MISS G.L. THOMPSON,

for the first and second respondents, (instructed by

A.F.A. Lindeman, Solicitor to the Department of Labour and Ministry of Consumer Affairs), and with my

learned friend, MR I.J. HARDINGHAM, for the third-named

respondent. (instructed by the Victorian Government

Solicitor)

BRENNAN J:	Yes, Mr Gillard.
MR GILLARD:	If it please the Court, ~his is an appeal from

the judgment of Mr Justice Marks dated 16 August 1988;
an appeal to the Full Court of Victoria was lodged by

notice dated 30 August 1988; proceedings were

removed into this Court pursuant to the JUDICIARY ACT

by order dated 14 October 1988.

The proceedings did involve two issues, namely

issues under section 92 and section 109 of the

CONSTITUTION. We indicate here and now and, indeed,

we have already indicated to a number of parties prior

to this date that we only wish to argue the matter

under section 109. Notices have been given to the

various States and territories and, Your Honours, we can

inform the Court that no other State or territory

wishes to intervene.

BRENNAN J: Do you have a precis of your argument, Mr Gillard?

MR GILLARD:  Yes, Your Honour, and I will hand that up now.

(Continued on page 3)

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MR GILLARD (continuing): Your Honours, can I go -

BRENNAN J:  It might be desirable if you give us a moment

to - - -

MR GILLARD:  Yes, Your Honours.

BRENNAN J: Yes, Mr Gillard.

MR GILLARD:  Your Honours, I go to paragraph 3 and refer

Your Honours to the agreed statement of facts which

is set out at page 81 of the removed book.	I do
not wish to go through those,Your Honours.	Your Honours

are no doubt familiar with them. Could I now produce

for Your Honours'assistance a bundle of the relevant

legislation and orders of the _Covernor in Council

Your Honours may find it convenient to refer to.

TOOHEY J: Mr Gillard, the book contains two sets of agreed

facts.

MR GILLARD:  Yes.

TOOHEY	J :	They -~ seem	to be the same.
MR GILLARD:	It is an error. The first	set	starting

at page 74, that is an error,Your Honours,and it

starts at 81. Actually I think that was a draft

that we worked off for the purposes of the final

agreed statement of facts, which appears at page 81

and following.

BRENNAN J:	In the light_of the information that you have given us do we need to concern ourselves with the statement
of facts at all?

MR GILLARD:  No, Your Honour. Now I have handed to Your Honours

a bundle of the legislation.	Now could I take
Your Honours to the chronology.	We have not stated

a date for the formation of the Federation, but it

is somewhere around 1911 and was registered
somewhere around about the same date.	The first

relevant matter is on 30 July 1985, Act No 10188 was

passed by the State of Victoria and I take

Your Honours to that - that is about one third of

the way into the bundle. It is called the

BLF (DE-RECOGNITION) ACT 1985.

BRENNAN J: Is there a page reference for this?

MR GILLARD:  No, I am sorry, we have not Your Honour. Oh yes

there is. I do apologize. Page 15 at the bottom

of the page.

(Continued on page 4)

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MR GILLARD (continuing):  Now Your Honours will observe the

long title, "An Act to make provision with respect to The Australian Building Construction Employees'

and Builders Labourers' Federation and the members

thereof and for other purposes". It is noted

in section 2(1) that:

Subject to sub-section (2), the several provisions of this Act shall come into operation on a day or on the respective

days to be fixed by proclamation -

et cetera.

(2) A proclamation made under this Act

shall not fix a day for a provision of

this Act to come into operation that is

before -

(a) the day on which the right of The

Australian Building Construction Employees'

and Builders Labourers' Federation to

represent employees in the State of

Victoria is limited or restricted by or

under the Commonwealth Act or any other

Act of the Parliament of the Commonwealth;

or

(b) the day on which the registration

pursuant to the Commonwealth Act of The

Australian Building Construction Employees'

and Builders Labourers' Federation is cancelled -

whichever first occurs.

Then we have an interpretation section which I will not go through at the moment. Sections 4 and 5 I

will not bother Your Honours with. Then, section 6

is ''Removal of BLF and its members from participation

in and protection of State industrial system" and:

6(1) Notwithstanding anything to the contrary

in the INDUSTRIAL RELATIONS ACT 1979 or any

other Act or in any rule of law, on the day on

which this section comes into operation - and then, various consequences flow as a result of

the Act coming into force but we now come over to

section 7 which is the most significant section and

the one we are most concerned about in this

particular Act.

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MR GILLARD (continuing): It provides:

For the purpose of protecting the rights of

persons who have ceased to be members of BLF,
the Governor in Council may by Order published in
the Government Gazette provide for the

restriction of the use of funds or property

of BLF and for the control of those funds or

that property.

Subsection (2):

An Order made under sub-section (1) -

(a) shall come into force upon the date of

•• publication of the Order in the Government
Gazette; and

(b) shall, unless sooner revoked, cease to be

in force at the expiration of 6 months from

the date on which it came into force but

may, at any time while it remains in force

(including a time when it remains in force
by virtue of a previous extension or previous
extensions under this paragraph), be

extended in duration·by a further Order made

by the Governor in Council and published in

the Government Gazette.

And then it states under subsection (3):

A person shall not contravene an Order made

under sub-section (1).

Then section 8 relates to a statutory declaration as

to evidence, immunity of certain persons from suit,

service of documents in section 10 and then section 11

says:

This Act shall cease to have effect at the

expiration of one year after the day on which

it receives the Royal Assent unless -

(a) all of the provisions of this Act have by

then been proclaimed to come into operation; or

(b) this Act is sooner repealed.

(Continued on page 6)

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MR GILLARD (continuing):  Your Honours,the next relevant dates

are the dates of the proclamations, and if one goes

over the page of our submissions, 14 April 1986 was the

date when all provisions of the Act came into force

except sections 4, 5 and 7 and then on 1 August 1986

it was proclaimed that section 7 should come into

operation and by the same Proclamation, actually I should put the dates-~ apologize to the Court, the

actual date of that;. Proclamation, of section 7 is

28 July 1986 was the date of the Government Gazette
and it provided that section 7 should come into operation

on 1 August 1986 and sections 4 and 5 on 1 January 2000.

I will be. coming back to that legislation later

but continuing with the chronology it is noted - - -

• BRENNAN J: Were those dates the dates of the Proclamation or

gazette? the dates of the publication of Proclamation in the

MR GILLARD:  28 August 1986 was( for section 7, 4 and 5.

BRENNAN J: The 28 July 1986?

MR GILLARD:  Yes, 28 July, Your Honour, I am sorry I will

check that again. Sorry, on 14 April 1986 all sections,

other than 4, 5 and 7 were proclaimed to come into

operation and that is by the Government Gazette of

that day.

(Continued on page 7)

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BRENNAN J:  Of the Proclamation of that day?

MR GILLARD:  Yes. That appears in the bundle, Your Honours.

If Your Honours go forward to the next document
at page 22 - actually I am sorry, I did not pick

up the date - so, it is at page 22, and, actually it

is - 14th day of April is the day of the Proclamation

and it was published on the same day, and that is

all sections other than 4, 5 and 7. And then the

next page, 23, is the Proclamation, dated 28 July 1986,

which provides, 1 August 1986 for section 7,

and 1 January 2000 as sections 4 and 5.

Now Your Honours will have noted in section 2(2),

of that Victorian Act, that it is not to	come into
operation until something is done at the	Connnonwealth
level - if I could describe it as such.	So, the next
thing that we go to is 14 April 1986: to
Connnonwealth Act No 6, which is at page 8.	Now,

Your Honours will see that that is a BUILDERS

LABOURERS' FEDERATION (CANCELLATION OF REGISTRATION)

ACT 1986. It has:

Come into operation on the day on which it receives the Royal Assent -

which is 14 April 1986. And then there is just

the section 3:

The registration of the -

BLF -

under the CONCILIATION AND ARBITRATION

ACT 1904 is by force of this section,

cancelled.

On the 0 same day Act.No 7-, which appears at

the next page, was passed. It is the BUILDERS

LABOURERS' FEDERATION (CANCELLATION OF REGISTRATION -

CONSEQUENTIAL PROVISIONS) ACT. The long title is:

An Act to enact certain provisions

consequential upon the cancellation of the

registration -

et cetera -

and for related purposes.

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MR GILLARD;·(contiru,;ting)· It is dated to cammence--in-to operation

immediately after the~BUD.DERS LABOURERS'.

FEDERATION (CANCELLAT'!ON OF REGISTRATION) ACT - that is $ection 2.

N0w, if we. go to section 4, this is the section

that raises the issue in this case. Section 4(1): Sub-section 143(5) of the CONCILIATION AND

ARBITRATION ACT does not apply in relation

to the Federation or its members but

sub-sections 143(4) and. (6) of that Act

apply. ·

(2) Any award that would, but for this

sub-section, apply to the Federation or its

members does not have any effect in relation

to the Federation or its members.

Then it goes on to provide further in that section,

sub-section (3), that:

A non-registered association -

which is defined here as being the BLF, or any name

it may assume thereafter -

is not capable of being a party to,

and shall not be permitted to intervene in,

a proceeding before the Commission and is not

capable of being a party to an award made

by the Commission.

(4) Subject to sub-section (5), the Commission

does not have any powers under the CONCILIATION

AND ARBITRATION ACT in relation to -

(a) an industrial dispute in so far as that

industrial dispute resulted from -

(i) an act done by a non-registered association

or by person who are members of a non-registered

association; or

(ii) an act done by an employer as defined by

section 4 of the CONCILIATION AND ARBITRATION

ACT in relation to a non-registered association; or

(b) an industrial matter as defined by section 70A - -

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MR GILLARD (continuing): Subsection (5) says:

Nothing in this section prevents the

Commission from exercising powers under the

CONCILIATION AND ARBITRATION ACT in relation

to an industrial dispute in so far as that

industrial dispute involves members of an

organization of employees registered under the

Act who are also members of a non-registered

association.

And then:

A person or an organization or association

of employees is not entitled to be represented

by an officer, employee, agent or member of a

non-registered association in any proceedings - Then subsection (5) relates to registration:

Notwithstanding anything in section 132 of the

CONCILIATION AND ARBITRATION ACT, a non-registered

association is not entitled to apply to be,

or to be, registered under that section unless -

(a) a period of 5 years has elapsed from the day

of commencement of the BUILDERS LABOURERS'

FEDERATwN (CANCELLATION OF REGISTRATION)

ACT 1986;

(b) the Commission, on application by the

non-registered association, has declared

that it is satisfied that - ·

(i) if the non-registered association were

registered under that section, the
non-registered association would not

engage in conduct inimical to the

prevention and settlement of industrial

disputes by means of conciliation and

arbitration; and

(ii)    the registration of the non-registered

association under that section would

not prevent or seriously hinder the

achievement of an object of the

CONCILIATION AND ARBITRATION ACTl and

(c) the requirements of the CONCILIATION AND

ARBITRATION ACT. and of the regulations in

force under the Act, that would, apart from

this section, apply in relation to an

application by the non-reigistered association
for registration under section 132 of that

Act have been complied with.

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Then it refers to the powers and procedures of the

Commission. Section 7 is concerned with the

eligibility of certain building industry employees

for membership of certain other organizations and

then section 8 gives a power to:the Governor-General

to:

make regulations, not inconsistent with this

Act, prescribing matters -

(a)	required or permitted by this Act to be prescribed; or
(b)	necessary or convenient to be prescribed for carrying out or giving effect to this Act.

Now as Your Honours will observe, the object of the cancellation. It is to be noted that section 143 of the CONCILIATION AND ARBITRATION ACT - we will

come to that in a moment - is concerned with

applications to the Court for deregistration and

this is where the legislature has taken the step

of deregistering and we would be submitting that

the object of this Act is to provide what is to

happen upon deregistration.

(Continued on page 11)

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MR GILLARD (continuing): Now that is 14 April 1986 and on

that day, after those Acts were passed, on the same

day we have the proclamation of the Victorian
Government Gazette with respect to the Victorian provisions of the Act to which we have already

referred.

TOOHEY J:  Does that mean, Mr Gillard, that the event referred

to in section 2(2)(a) of the BLF (DE-RECOGNITION) ACT

came about by reason of the first of the Commonwealth statutes and the event in (b) by reason of the second

of those Acts?

MR GILLARD:  Yes. So, we have referred in our chronology to those

dates; 14 April, 28 July and 1 August. Now,

Your Honours, the next date should be 13 October 1987

not 1986.

On that day, Your Honours, there was an order

made by the Governor in Council and that appears

at page 27.	The Act is referred to there, at
the top:

The Governor in Council makes the following

Order ..... Pursuant to section 7 of the -

Victorian Act -

section 5 of the POLICE REGULATION ACT 1958 and all other available powers the Governor

in Council orders that:

1. Possession, custody and control of the

funds and property of BLF is hereby committed

to Ian Gordon Sharp (hereinafter called "the
Custodian").

2.       No person shall pay or dispose of any of

the funds or property of BLF or of any interest

therein, or create any encumbrance or charge in

respect thereof, without the prior written
consent of the Custodian.	Any such payment

disposition encumbrance or charge shall be

void, at the option of the Custodian.

(Continued on page 12)

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MR GILLARD (continuing):

3. The Custodian may refuse to give consent
referred to in clause 2 hereof if he in his

absolute discretion is not satisfied that the

payment disposition encumbrance or charge is

desirable to be made for the carrying out of

the ordinary and proper affairs of BLF and for
the benefit of its members.

4.      The Custodian may pay or direct any person

to pay from the funds or property of BLF such sum as appear to him in his absolute discretion to be

desirable to be made for the carrying out of the

ordinary and proper affairs of BLF and for the

benefit of its members.

5. A person who is in possession of or who has the
custody or control of any funds or property of BLF
or of any document or title thereto or document

relating to the title thereto or of any books -

et cetera, et cetera -

(a) shall forthwith inform the Custodian thereof.

(b) shall on demand by the Custodian or by a

person authorised by him in writing deliver the

same up .....

(c) shall not part with such possession, custody

or control save to the Custodian or such authorized

person.

and then 6 gives him power where he believes that some

person may have documents to require that person, in

writing, to provide information and produce documents.

7. The Custodian shall forthwith take possession

custody and control of the funds and property of

BLF.

8. For the purpose of performing his functions

under this Order the Custodian may:

(a) enter on and take possession custody and

control of all premises which are or appear to be

in the possession of or occupied by BLF .....

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MR GILLARD (continuing):

(b) seize and retain all documents, records

and property in any such premises which may

reasonably be regarded as being or relating
to or connected with the funds or property

of BLF.

9. Subject to any further Order in Council

and so long as this Order or any extension

thereof is in force the Custodian shall
remain in possession custody and control
of the property and funds of BLF for the

purposes of carrying out the ordinary and

proper affairs of the BLF pursuant to
clauses 3 and 4 of this Order.

Now the balance of those ciauses of the Order relate to the right of the Chief Commissioner to - I am sorry, 10 and 11 relate to the Chief Commissioner's

powers to enter premises and seiz·e and that:

No person shall ..... obstruct -

et cetera. And then:

12.   From time to time as he thinks appropriate and at least once every three months, the Custodian shall deliver to the Minister

proper accounts of his dealings with the

funds and property of BLF and a report

stating his activities as Custodian since

the date of this Order or of his last report

and any recommendation which he thinks fit

to make in respect of such matters.

Pausing just there, Your Honours, it may be convenient if I go now to section 143(6) of the

CONCILIATION AND ARBITRATION ACT and that is. found

at page 7. Now 143 - sorry Your Honours, I

have taken you to the wrong page. It starts at

page 6, the extract that we have produced. Section 143

is concerned and gives under subsection (1) which we

have not reproduced, right to certain persons to

apply to the court for an order directing the

cancellation of the registration of an organization

on the ground that, and it sets out various grounds.

Now Your Honours will recall under section 4 of

the Commonwealth Act, that is No 7, BUILDERS

LABOURERs·- FEDERATION CONSEQUENTIAL ACT' it said

that 143(4) applied and that reads:

The cancellation shall not relieve the organization or any member thereof from any

penalty or liability incurred prior to the

cancellation.

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So that is incorporated into the Commonwealth Act

No 7.	The Act said 143(5) did not apply and it
states:

Upon cancellation of the registration of

an organization, the organization and its

members shall cease to be entitled to the

benefits of any award -

et cetera, and indeed Your Honours will have

observed in that Commonwealth Act No 7,

section 4(2) at page 11 appears to take up the

same subject-matter. Then incorporated section 143(6)

and it is 143(6) which we say comes into collision

with section 7 of the Victorian Act in the orders

of the Governor in 6ouncil made pursuant to it. So

that appears at the top of page 7:

Upon the cancellation of the registration

of an organization, the organization shall cease

to be an organization and a corporation under

this Act, but shall not by reason of the

cancellation cease to be an association. The

property of the organization shall, subject to

any order which the Court, upon application by

a person interested, may make with respect to the

satisfaction of the debts and obligations of

the organization out of that property, be the
property of the association and shall be held and
applied for the purposes of the association in
accordance with the constitution and rules of
the organization insofar as they can be carried

out or observed notwithstanding the

deregistration of the organization.

So if I can just speak generally now, the thrust of

what we are putting to this Court is that that

provision relating to property, where it states

that the"property shall be the property of the
association", comes into conflict with the

Victorian set of laws and that in a nutshell is

the issue. (Continued on page 15)

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TOOHEY J:  I suppose ordinarily, Mr Gillard, the opening words

of section 143(6) would refer only to cancellation

pursuant to an order.

MR GILLARD:  Yes, and it is incorporated into this Act to

deal with the legislature cancelling. That, with

respect, would be correct. That would follow.

TOOHEY J:	So it is what, section 4 of the CONSEQUENTIAL PROVISIONS ACT which you say gives an operation to
sucsection  (6) in the case of this organization
which was not cancelled by reason of an order of the
comm1ss1on.
MR GILLARD:	Yes, that is so, with respect, Your Honour.

. . Perhaps if we just go back and see that again, that
is at page 11 where it says at section 4(1):

Sub-section 143(5) of the CONCILIATION

AND ARBITRATION ACT does not apply ..... but

sub-sections 143(4) and (6) of that Act apply.

So section 143(6) is incorporated into Act No 7

and we say, speaking generally, the issue here is that

the reference to the property remaining the property

of the association comes into conflict with the

Victorian set of laws.

McHUGH J:  Is there one or two levels of attack on the Victorian

statutory scheme? For example, section 7 seems to

authorize restrictions of the use of the funds and

property of the BLF which would go far beyond what has

actually occurred. Is it section 7 which you say is in

conflict with section 143(6), or is it merely the

subordinate instruments, or is it both?

MR GILLARD:  Well, when in doubt say, "both", Your Honour,

but I suspect on a proper analysis it must be the orders

because it is the orders that actually have been made

which set out the powers of the custodian as to what

he is to do.	Of course, the right or the authority
to make such orders comes from section 7 but, Your Honour,

in our submission, probably the wisest thing - the answer

at this stage is we attack both because the orders

follow from the section, but in the end result - - -

McHUGH J:  Are the orders laws within the meaning of

section 109 of the CONSTITUTION?

MR GILLARD:  Well, I think there may be a short answer to that.

The first one was passed into law and I will come to the

next Act, Your Honour. To put it beyond doubt, they

made the order of the Governor in Council then they passed another Act to fix a few things up and, if I

remember correctly - if you go to page 25 you will

find that this is an Act, BLF (DE-RECOGNITION)

(AMENDMENT) ACT which was assented to on 14 October,

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and if one goes to page 25 you get amendment of

section 7 and section 5(b)(4):

The Order -

of the Governor -

in Council declared to be made pursuant

to section 7 of this Act and section 5 of

the POLICE REGULATION ACT 1958 and

published in the Government Gazette on

13 October 1987 is hereby declared to be

and to always have been as valid as if

enacted herein".

Q	So that, referring to section 143(6), raises what we
say is the collision course in this case.

BRENNAN J:  Is it a collision with respect to title to

property?

(Continued on page 17)

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MR GILLARD: Well, we submit that on a proper analysis of

the orders, that though it does not talk about the
title to property going to Dr Sharp, nevertheless,
the practical effect is that he deals with it as if

he is the true owner of the title to the property,

and no doubt the other side will argue that
section 143(6) is talking about the legal and

beneficial title, that on a proper analysis of the

orders Dr Sharp only the custody, possession and

control, and he does not have the legal and maybe

the beneficial title.

Now, we submit that the practical effect of the orders is that he does have all the rights of a true

owner because he can deal with it as he likes,

subject - - -

BRENNAN J:  So can a liquidator of a company, can he not?

MR GILLARD: Well, yes, again subject to powers set· out in

the COMPANIES ACT, or the codes, that, with respect, is

so, but this is not, in our submission, a liquidation.

It is an example where a government is seeking to

interfere with the property rights of an association

and we S'Ubmit that under section 143(6) the

Commonwealth has evinced an intention to deal with

the property of that association.

McHUGH J:  Can we decide this case without access to the

rules of the organization?

MR GILLARD:  I would have thought, with respect, yes, Your Honour.

McHUGH J: Well, supposing the rules of the organization

provided that a custody, and so on, was to be given

to trustees, or a particular person: that might throw

up a conflict in the Victorian instruments quite

readily.

MR GILLARD: Well, if I can assert this from the bar table;

there is provision for trustees in the rules, but I

would have thought, with respec~ that the matter

can be decided without going into the rules and

regulations. We say that under section 143(6) the

property is to be the property of the association -

the new body - the unincorporated association.

The deal - - -

McHUGH J:  It has also ,got' to be applied in accordance with the

rules of the organization.

MR GILLARD:  Yes, but to do what it wishes with it, subject

to those rules and the constit~tton~. Now we submit

DAWSON J: Presumably in accordance with the law. MR GILLARD: And in accordance with the law, yes.

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DAWSON J: It does not guarantee the·property of the association

thereafter notwithstanding judgment against it or other

laws which - - -

MR GILLARD:  No. I respectfully agree with that. One can

talk about trespass, but you cannot use property

to trespass, and that type of thing. I respectfully

agree it would be in accordance with the law, but -

DAWSON J:  The relevant law would be Victorian law, would it

not?

MR GILLARD: Well, yes.

DAWSON J:  In so far as the property is in Victoria, anyway.

MR GILLARD: In so far as it is in Victoria. But that must

apply, in our submission, with.ownership of any

property: that we can only deal with it in

accordance with the law, and we say that the

Commonwealth has indicated that that is where the

property is to go and to be dealt with in accordance with the rules and constitution of the organization.

DAWSON J: That is where it is to go upon the cancellation - - -

MR GILLARD:	Yes.
DAWSON J:	- - - but it does not guarantee its future.
MR GILLARD:	Well, within what is stated in the section,

Your Honour, it guarantees the future, subject to the law. In other words, it guarantees a right to deal with it as you desire, subject to the law and

subject to the constitution and rules. What has

happened here is, and this is the thrust of what

we are saying, _ that Dr Sharp, even though he is

only given custody, possession and control, cuts

across the right of the association to deal with its

own property.

DAWSON J:  I am not sure that I follow that. Upon the

cancellation of registration the organization ceases

to be incorporated?

MR GILLARD:  Yes.

DAWSON J: It becomes an association like any other

association existing within the State, and like any

other association existing within the State it can

carry on its affairs and use its property, subject to

such restrictions as may be imposed upon it by law.

MR GILLARD:	Yes.	But - - -
C2T14/2/FK	18	13/2/90
Dobinson(2)

GAUDRON J:  You place your emphasis on "to be held", do you,

Mr Gillard, in so far as section 143(6) requires

it "to be held" in accordance with -

MR GILLARD:  Yes, I certainly do, Your Honour, and "applies".

GAUDRON J: And, for that purpose, you ask us to what,

assume that the rules do not provide for it to

be held by the custodian?

MR GILLARD:  Well, I think that is an inference or something

that would be conceded by the other side, that

that is so, Your Honour, but that is the thrust

of what we say; that the law says, "Well, after

cancellation the property shall be held by the

unincorporated association" and - - -

McHUGH J: But, does section 143(6) speak for longer than

the second immediately after the question of

cancellation? Surely section 143(6) would not

prevent the organization,if it wanted to,the

day after cancellation from dissolving and

getting rid of its property.

MR GILLARD: That, with respect, would be so, subject to

any application to the Federal Court by a person

interested to seek payment of a debt,but that

would appear to be so, Your Honour.

BRENNAN J:  Mr Gillard, could I bring you back to the question

I asked you first because we seem to have moved
from title to the question of the custody, possession

and control of assets?

MR GILLARD:	Yes.
BRENNAN J:	Now, I understand the answers that you have

given with respect to custody, possession and

control. It does not seem to me to have touched

the question that you first said you wished to

found on; that is, title. Section 143(6) says

"the property shall be the property of the

Association". Now, does the Victorian Act say

anything to the contrary?

MR GILLARD: Not specifically, Your Honour. It does not

expressly state that because they use - - -

BRENNAN J: Tioes it by implication?

MR GILLARD:	We would submit by implication by reason of the powers that are given.
BRENNAN J:	Do you mean powers are given over the property to the custodian?

C2Tl5/l/SH	19	13/2/90
Dobinson(2)

MR GILLARD:  Yes, to deal with the property as he desires,

subject of course to any restrictions in the

orders.

BRENNAN J: Well, why do you say that affects the title?

MR GILLARD:	Because, in our submission, the title to property involves (1), a right to deal with it in accordance
with the law and we submit that by giving that
right to some other person you are restricting the right of the true owner to deal with the
property and, therefore, it does interfere with
the title and, on top of that, under the provisions in the orders, the custodian is entitled to transfer the property or pay out the property to others
and we submit - - -
BRENNAN J:	I understand that but not in discharge of his

own personal debt, surely?

MR GILLARD:  No.

BRENNAN J: Well, then, how is it his property?

MR GILLARD:	Well, if you put it like that, Your Honour, I cannot say that it is his property but the
fact is that the powers that are given to him to deal with the propety are equivalent, in our submission, to deeming it to be his property and cuts across the title of the organization
to deal with it as its own property. We submit
there is no warrant for reading down what "property"
means there in the Commonwealth provision. There
is no warrant to read it down at all and that means that it is the property of the organization
to be used by them and dealt with by them as
the true owner would with all the incidents of
legal and beneficial ownership.
Now, we submit that, if you look at what Dr Sharp is permitted to do, that empowers him to
deal with the property as if it was his own for the
purposes set out, of course, in the orders.
Now, Your Honour, with respect, he cannot use
the property to look after himself but the powers
that he is given are very wide and entitle him
to deal with the property as the true owner.
DAWSON J:	You go so far as to say there were no

rights really left with the association at all

other than the bare title.

MR GILLARD:  That is so.

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Dobinson(2)

BRENNAN J: Other than the bare title?

MR GILLARD:  Other than the bare title because on one argument

it is still the property; if one literally

construes these provisions it is still the property

of the unincorporated association. But the

practical effect, in our submission, is that

Dr Sharp deals with it as if he was the true owner.

BRENNAN J:  But his powers under section 7 are restricted by

the purposes which are therein	set out, are they
not?

MR GILLARD: Yes, Your Honour, perhaps I should go the

extra step and indicate there were some amendments.

If I could perhaps go to that so that Your Honours

have all the provisions before you. If one goes

to page 24, we have the BLF (DE-RECOGNITION)

(AMENDMENT) ACT and that was assented to the day

after that first order of the Governor in Council

and, of course, it was on that 13 October - just

to add to the chronology, or as it words on the

bottom of the chronology - a raid took place on the

premises and the property was seized.

This Act, as Your Honours will observe then

in section 2:

is deemed to have come into operation on -

the previous day, the 13th, and:

Section 6 is deemed to have come into operation

on 30 July 1985.

A reference is to that first Act of 1985. The first

thing that is done is that sections 4 and 5 of that

Act are repealed, and then section 7 is amended.

If Your Honours go back to page 20, I can

indicate what Your Honours have to insert. In the

first line you have got:

For the purpose of protecting the rights of

persons who -

you should add the words there "are or". It then

reads: "For the purpose of protecting the rights of persons who or or have ceased to be members of

the BLF ..... ". Then we get down to the third

line and where it says:

published in the Government Gazette provide

for the restriction -

you insert "or distribution".

C2Tl6/l/LW	21	13/2/90
Dobinson(2)

Now I think there may have been an error in the

drafting there because it then reads, "for the

restriction or distribution of the use of funds or

property of BLF ..... ". : .Then you go on:

and for the control -

and after the word "control" in that second last

line you add "vesting and realization".	So the
subsection now reads:	"For the purpose of protecting

the rights of persons who are or have ceased to be

members of the BLF, the Governor in Council may by

Order published in the Government Gazette provide for the restriction or the distribution of the use of funds or property of BLF and for the control, vesting and realiz,ation of those funds or that property".

Then if one keeps going on that amending Act you have - this is on page 25 - repeal of section 11,

this is section 6:

Section 11 of the Principal Act is repealed.

And that is the one that had the cessation of operation
of that first Act. Well that has been repealed,
and section 7A has been inserted which relates to the

obligation on the custodian's report to Parliament.

That Act was deemed to have been in operation on

13 October 1987 and we have drawn Your Honours'

attention to, on page 25, the order of the

Governor in Council declared on the day before it is deemed to:

have been as valid as if enacted herein.

(Continued on page 23)

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BRENNAN J:  Was any order made vesting property in Dr Sharp?

MR GILLARD: Well, perhaps the answer to that is that the

next order which is 10 November 1987 gives him the

power - so that is at page 29. So just going back again,

Your Honours, we have the first Order in Council which

is dated 13 October which I have read to Your Honours,and

the next page over,29,is one made on 10 November 1987,

and under the heading "Vesting Assets", paragraph 2: The Custodian.may vest in himself as Custodian

any funds or property of BLF.

What precisely "vest" means there it may be an interesting

question bearing in mind that he already had the custod½
possession and control given to him by the previous

order in paragraph 1, this is·on page 27:

1. Possession, custody and control of the

funds and property of BLF is hereby committed -

and then under 7 of that order obliged to:

forthwith take possession custody and control.

Then one comes over and says, "Wel], why add the
words 'may vest' ?fl, and we would be submitting that

"vest" there means vesting an interest in him to

enable him to deal with the funds or property as

is necessary to deal with those funds.

BRENNAN J:  Does the custodian exercise that purported

power?

MR GILLARD:  Other than paying out the debts ~ there are two

things, Your Honour: the custodian has taken money

and has no doubt lodged that in a bank account in

his name as custodian and, secondly, paying out
the debts, or some of the debts, of the association

but other than that the answer to Your Honour's

vesting one may submi4 in our submission,that by	question is'no". IE·bytaking those steps that is
paying the debts of the association he may vest
himself of the funds to enable him to do that.
So far as the real property is concerned the evidence is that he has lodged Queen's caveats with respect
to the real property which is valued at some
$1.7 million.

BRENNAN J:  Mr Gillard, I do not want to take you out of

the course of your argument .but it may: be that

at the end of the day the supposed_

inconsistencies might consist in. a number of

particular provisions and a question of severance

may arise, so perhaps you might put that at the

back of your mind and come to it at some suitable time.

C2Tl7/l/JL 23 13/2/90

Dobinson( 2)
MR GILLARD: Yes, if Your Honour pleases. Your Honours,

if one goes to chronology - - -

DAWSON J:  Can I just stop you there with that

particular clause 2 of the order~ That cannot

really mean vest in ownership, can it it must
really mean vest in possession because it says:

may vest in himself as Custodian - - -

MR GILLARD: Well, one suspects it was put there as an

over-abundance of caution, he having already got

possession, custody and control under the first

order of Governor in Council, and it may be that that

was inserted there to give him a better title to

deal with the property. I mean, with respect, if

one literally takes what is said there, well, we respectfully

agree with, Your Honour, but why add it when,- in our

submission, he has already got that under the first

orders of Governor in Council and we would submit

that if effect is to be given to that for the purpose

of that then it is to give him a better title to

deal with the property. I do not think I can say

much more in respect of that.

Your Honours, as I say at the bottom of page 2,

on 13 02tober there was a raid on the premises and

the property was seized; on the next day we had

the Act which I have just drawn Your Honours' attention

to, which is the Amendment Act; it was restro-~ective

in operation and, of course,itramenpedsection T and
then on 10 November 1987 which is the next order of

the Governor in Council.

(Continued on page 24)

C2Tl7/2/JL	24	13/2/90
Dobinson(2)

MR GILLARD (continuing):  Your Honours will see that Order 1

relates to:

In this Order a reference to the
Custodian is a reference to the

Custodian, Ian Gordon Sharp, to whom

possession, custody and control of the

funds and property of BLF was committed

in accordance with the Order in Council

dated 13 October 1987.

2.       The Custodian may vest in himself as

Custodian any funds or property of BLF. 3. In addition to any other powers the

• •	Custodian shall have absolute power to
bring and defend any ac~ion in relation
to such funds or propert~ or. his position
as Custodian.
4. The Custodian may pay out of the funds
or property of BLF the costs, charges and expenses which he incurs or is put to in or about the carrying out of his powers or
duties as Custodian, but not so as to include his remuneration or that of any of his assistants or employees, or any of his
..... costs ..... of any investigation into
the affairs of the BLF.
5. The Custodian may pay out of the funds
or property of BLF any debt or liability of BLF or of its members as such which is
establish to -

it should be "his" -

satisfaction -

Your Honours will see the width of that power -

6. Subject to the powers and provisions

herein contained or contained in the Order

dated 13 October 1987 the Custodian may if

and when he thinks proper invest any funds

of BLF in such trustee securities as he

from time to time thinks fit.

Then it gives him power under 7 to:

employ such assistants and agents as he

thinks fit.

The following paragraphs are not relevant to the matter

before us and relate to persons being appointed

investigators for the purpose of looking into the

affairs of the BLF. There are other orders of

C2Tl8/l/HS	25	13/2/90
Dobinson(2)

Governor in Council. We include them for completeness.

At page 30 there is one relating to the powers of

the investigators, page 32 extends the duration of

the original orders and the other matters are of no

consequence. Then we go over to page 33 and it is

extended until 16 October 1988 and our instructions

are that further orders have been made and the last

one is published in the Government Gazette - it is

not in the bundle - dated 13 September 1989. The

order was dated 12 September 1989 and it extends all

the original orders until 12 March 1990.	So the
orders are still operative.

Your Honours, under the CONCILIATION AND

ARBITRATION ACT, as Your Honours are aware, one may

apply for registration under section 132 and by reason

of section 136 the organization becomes an incorporated

body. Section 143, as we ha~~ already stated to

Your Honours, is concerned with the cancellation of

registration by court order. Now, if one goes to

Commonwealth Act No 7, and, in our submission, it 1s

clear from its terms that the law is dealing with

what is to occur upon cancellation and, in our

submission, if one looks at the title and also the

provisions which we have quickly gone through, it is

our submission that that Act is concerned with the

consequences that flow from the cancellation.

(Continued on page 27)

C2T18/2/HS	26	13/2/90
Dobinson(2)

MR GILLARD (continuing):  Now if we could go to section 143(6)

because I wish to examine that a little more closely to

see what it sets out to achieve, and that is at

page 7. Now we submit that the section can be

divided up into three parts and it seeks to achieve three objects. The first is the first sentence and

that deals with the question of legal personality

and as Your Honours will see from the words there;

it ceases -

to be an organization ..... under this Act - and a corporate body under the Act, but it does -

cease to be an association.

So thereafter it is an unincorporated association

and that emerges clearly, in our submission, from

the first sentence and that is what, we submit, its

object was, to avoid any controversy or dispute as

to what is the status of the association upon

cancellation. And the second part of the subsection

is concerned with property and if one, for the moment,

deletes the proviso, which is in the middle of that

second sentence, it reads:

The property of the organization shall ..... be

the property of the association -

Now it is an organization under the Act, as

Your Honours appreciate, now"shall be', so -

The property of the organization shall ..... be

the property of the association and shall be held and

applied for the purposes of the association

in accordance with the constitution and

rules of the organization insofar as they can

be carried out or observed notwithstanding

the deregistration of the organization.

Now we submit that there is no warrant for reading

down the word "property" theret that it covers all

property and the right to deal with that property

as a true owner subject of course to the law and

subject of course to any constraints placed on it
by reason of the constitution and the rules of the

organization. Subject to those, the new association,

if I can call it that, has full rights to deal with

it as its own property.

McHUGH J:  But does the section have any other function than

to deal with the effect of loss of the status of
registered organization and corporation, and what

is to happen to the property of the corporation

immediately it is deregistered? I put to you earlier

that it only speaks in the instant of time after deregistration.

C2Tl9/l/CM	27	13/2/90
Dobinson(2)

MR GILLABD: ~es, ~hat, with respect, is correct, though there

is the third part, of course. I have cut out the

proviso which is the third object of the subsection

which gives a right to persons to go to court, but

it does indicate that it shall be the property of

the association and it does, I respectfully agree,

speak as from that time.

McHUGH J:  But does it continue to speak? Does it have any

operative effect?

MR GILLARD:  In our respectful submission, if you say it is

your property, what you do with it hereafter is

your property and however long you may keep that

property - you have got a right to deal with the

property.

McHUGH J: Well that is true, but it does not mean that you

are entitled to keep it forever.

MR GILLARD: With respect, if you desire to keep it forever,

why can you not keep it forever?

McHUGH J: In the area of 109, what is there to stop the

State of Victoria passing a law that all unregistered associations shall pay 20 per cent of their funds into a particular government fund?

Would that contravene 143 (6) 7

MR GILLARD:  No, because, in our submission, that would not

be inconsistent with the rights of the true owner.

It would be an obligation placed upon that true

owner to discharge, but it would not effect the

rights of the true owner to deal with the property.

He would now be subject to the law that he has to

use his property to discharge that obligation.

(Continued on page 29)

2Tl9/2/CM	28	13/2/90
Dobinson(2)

MR GILLARD (continuing): That does not give the right

to the Victorian Government to deal with that

property as, in a sense, its own and that is

what we say the practical effect of the set of

laws is; that Dr Sharp does deny us the right

to deal with our property at all and we submit
that, under this second part of the subsection,

we are given that right. It shall be held and

applied by the Association for its own purposes,

subject of course -

McHUGH J: But, supposing the Victorian Parliament under

a LANDS ACQUISITION ACT, wanted to take one of

the buildings of the BLF. Surely section 143(6)

would not stand in the way if they wanted to - - -

MR GILLARD:  Well, that raises the - we.would be submitting

it would because it would come face to face with the

rights that are given to the organization to deal

with its own property. If there was no basis

for taking the property, we would submit that

that would fly in the face of the indication

in the legislature as to what is to happen to

the property.

TOOHEY J: But, does the subsection do any more, Mr Gillard,

than place the formally registered organization

in the position that it was immediately before

registration?

MR GILLARD: Well, in our submission, it does. It goes

on to provide three things: it deals with status,

brings it back to an unincorporated association

and that avoids any dispute as to that point.

Secondly, it spells out clearly what is to

happen to the property, again, no doubt, to

avoid any disputes with respect to what the

property may or may not - or who can deal with

the property and the third point which I am coming
to is that it gives a right to a person interested

to apply to a court; namely, the Federal Court,

to seek an order with respect to satisfaction

of debts and obligations.

BRENNAN J:  But does that not simply mean that whereas

there was a corporation with assets and obligations,
there is no longer a corporation so the property
is then transferLed by force of 143(6) to the

unincorporated association .which, I take it,

means the members thereof, and provision is made

then for the passing of the title and the enforcement

of the obligations theretofor being the obligations

of the corporation.

MR GILLARD:  Yes, we .would respectfully agree with that.

C2T20/l/SH	29	13/2/90
Dobinson(2)

BRENNAN·J:  Well, if that be the effect of 143(6), then

the point made to you by Mr Justice McHugh seems
to me to be unanswerable; that what it does is
to say, "Here is the corporation. There is the

unincorporated membership. We transfer over

the assets and the liabilities".

MR GILLARD: 

Yes, but in our submission, it makes it clear

that the title to that property and the right
to deal with it as a true owner is spelt·

out in that subsection and we submit that the

bundle of Victorian laws cuts across that right

and that though the property still remains

technically in the hands of -
or the title remains with, the unincorporated

association, the practical effect is that it

cannot deal with that property as the true owner

by reason of the set of laws of Victoria.

BRENNAN J: Is that not picked up by the last line and

half of section 143(6)?

MR GILLARD~ Well, that is ehe point we are making,

Your Honour; that the property does remain and

is held for the purpose of the association and

it can deal with it as the true owner in

accordance with its constitution and rules and

that that is what is to take place upon cancellation

and the other set cuts across that and brings

it into collision with that right.

(Continued on page 31)

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MR GILLARD:  Now, Your Honours, we submit that section 143(6)

does establish those three purposes, namely, what is

to happen with respect to the status; what is to

happen to the property; who shall hold it and apply

it, and giving a right to the Court, or to a person

interested, to go to the Federal Court to make an

application for an order:

With respect to the satisfaction

of the debts and obligations of the

organization out of that property.

TOOHEY J: What do you derive from that part of subsection (6),

Mr Gillard?

MR GILLARD: Well, we do not really derive anything from that,

Your Honour. It is there and_that is what it is set

out to do. It gives a right to a person who is

owed a debt to go to the Federal Court to get some

order out of the property: and the "the property"

must be the property as at the date of cancellation.

But it is concerned with execution in one sense: that one would go to the court having established a right

to the debt and seeking an order that the property

of the former organization is to be applied for

satisfaction of the debt.

TOOHEY J: Well, it simply means, does it not, that someone

to whom money is owed by the organization does not lose

the right to enforce that debt by reason of the change

in status of the organization?

MR GILLARD:  Yes. Well that, with respect, is so, though it

seems to be more concerned with execution, but it

would be implied, no doubt,that that right is there

to make application to a court, but no doubt just to
satisfy the court you have a right to a debt, or

indeed damages for breach of obligation, and then you would seek an order from the Federal Court, and that makes that clear also. But, we submit that, more

importantly, there are three purposes to be seen, or three objects to be seen in that subsection, and one	is concerned with what is to happen to the property.
And, there is no warrant for reading down the section
to say that it really only relates to the two other
matters and that the property reference is only something-that is incidental or consequential.

McHUGH J:  Just before you leave ~what is the effect of the

words:

insofar as they can be carried

out or observed -

in section 143(6)?

C2T21/l/FK	31	13/2/90
Dobinson(2)

MR GILLARD:	No doubt they were there, in our submission, because the rules were originally rules of a body
corporate, under the Act, and then the question is
whether those rules can still apply in all their
full force, notwithstanding the deregistration.
In other words, you may have to mould the rules
or you may reach the point where the rules cannot
be applied because you now have a different body.
That is what would appear the reason for those words
being there.

Well now, we now go, Your Honours, to .. the top of page 4,

to looking at the orders of the Governor in Council. -

Perhaps before we do that we just dwell again on

section 7 as amended, that is at page 20. So,

power to make these orders by the Governor in Council,

set out in that section:

For the purpose of protecting the

rights of persons who -

are, or -

have ceased to be members.

The orders may provide for restriction or distribution

of the funds and the property and it may also

set out powers with respect to control, vesting and

realization of the funds or that property.

(Continued on page 33)

C2T21/2/FK	32	13/2/90
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MR GILLARD (continuing): Now, if one looks at the orders of

the Governor in Council - I am now referring

Your Honours to paragraph 8 on page 4 - we submit

that, on a proper analyses of the two relevant orders

of the Governor in Council, being pages 27 and 29,
that the first thing we say is that the orders of
the Governer in Council do deal with the same subject-
matter as the Commonwealth Act, namely the property

of the association, and the orders can be divided

into three separate categories. The first is committing

possession, custody and control of the funds and
property to Dr Sharp with a right vesting the property
in him; total prohibition on others dealing with
property and funds and a very wide discretion vested
in Dr Sharp as to the use of the funds and property.

In the first category relating to committing possession,

custody and control we refer rour Honours to
paragraphs 1 and 7 of the first order which is dated

13 October. That does provide:

Possession, custody and control of the

funds and property ..... is hereby committed -

and, he:

shall forthwith take possession.

There was an amendment which I omitted to tell

Your Honours. If one looks at page 27, paragraph 7,

it says:

The Custodian shall forthwith take

possession custody and control of the

funds and property of BLF.

There are some words added by - at page 33 there is a

copy of the Order of the Governor in Council and what

is added to paragraph 7 of that order is the words:

"other than membership contributions

or sustentation fees received by the

Victorian Branch or the Federal office

on or after 13 October 1987 or funds or

property acquired by the use of such

contributions or fees".

If one then looks at paragraph 9, going back to page 28 -

this is the first order - one can see that:

Subject to any further Order in Council

and so long as this Order ..... is in force
the Custodian shall remain in possession
custody and control of the property and
funds of BLF for the purposes of carrying
out the ordinary and proper affairs of the

BLF pursuant to clauses 3 and 4.

C2T22/l/HS	33	13/2/90
Dobinson(2)

Then paragraph 2 of the order - and this is not

in the notes, if you could add this, Your Honours-

two-thirds of the way down page 4 I have category (i),

if one adds "(d) paragraph 2 - 0 - 10.11.87" which

relates to the vesting:

2. The Custodian may vest in himself as

Custodian any funds or property of BLF.

If one looks at the second category which is the

prohibition on anybody else dealing with the property

and funds, Your Honours will see paragraphs 2 and 5

of the first order of 13 October which is:

No person shall pay or dispose of any of

the funds or property ..... or create any

encumbrance ..... without the prior written

consent of the Custodia~. Any such payment

disposition encumbrance or charge shall be

void, at the option of the Custodian.

(Continued on page 35)

C2T22/2/HS	34	13/2/90
Dobinson(2)

MR GILLARD (continuing):  The option of the custodian and

paragraph 5 dealing with people who have possession

of funds and the like being obliged to inform the

custodian and on demand paying them over and not depart -

parting with possession. And then so far as a very

wide discretion that is vested in Dr Sharp, I refer

Your Honours to paragraphs 9 first rather than 4

in that order because it says that:

9.      Subject to any further Order ..... the

Custodian shall remain in possession ..... for

the purposes of carrying out the ordinary and proper affairs of the BLF pursuant to clauses

3 and 4 -

. .

One then goes to 3 and 4 and this shows the width of his discretion, 3 follows on from 2 - this is relating

to him giving written consent with respect to paying

or disposing of any funds or property and the power

is very wide:

3. The Custodian may refuse to give consent

referred to in clause 2 hereof if he in his

absolute discretion is not satisfied that

the payment disposition encumbrance or charge

is desirable to be made for the carrying

out of the ordinary and proper affairs of BLF

and for the benefit of its members.

4.      The Custodian may pay or direct any person

to pay from the funds or property of BLF

such sum as appear to him in his absolute

discretion to be desirable to be made for the

carrying out of the ordinary and proper affairs

of BLF and for the benefit of its members.

And then 2 goes back to his powers with respect to

written consents to charges and the like and then the

wide powers that is given to him in the second

order which is 10 November, paragraphs 3, 4, 5, 6 and 7,

and Your Honours will see that powers relating are

additional powers given to him with respect to defending

proceedings and bringing them and the like;·may pay

out of thi funds in 4i 5, in our submission, is a

significant one:

5. The Custodian may pay out of the funds

or property of BLF any debt or liability of

BLF or of its members as such which is

established to this satisfaction.

So, in the end, he determines, in our submission,

whether a debt or a liability should be paid if it

is to his satisfaction.

C2T23/1/JL	35	13/2/90
Cob in son ( 2)

Now going over to the top of page 5,. it is our

submission that there is a direct conflict

between the two sets of laws. The Commonwealth law

was made applicable on 14 April 1986 and operated

with respect to the property and its use; the

Victorian law bas operated on and after 13 October and

in our submission dealt with the same subject-
matter.

We first of all refer to possession, custody and control of the property committed to the

custodian. Your Honours, I have only referred to

one paragraph there, it should read paragraphs 7 and 9

of the order of 13 October 1987 and paragraph 2

• of the order of 10 November 1987. Now it is our

submission that under the Commonwealth legislation the

property is to remain the property of the association

to be dealt with in accordance with its rules

et cetera, we submit that to commit possession,

custody and control is to deny full ownership and

the right to deal with the property as one chooses,
or subject to the law, association loses full rights

to the property.

Now we submit that it lacks reality to argue

that the property still remains that of the

association and that Dr Sharp's rights only relate

to possession, custody and control. In our submission
property in the Commonwealth Act should be construed
as giving full rights to deal with it, subject to

the rules,et cetera. Ln our submission Victorian laws

deny full ownership and denies the incidence of full

ownership to the association.

(Continued on page 37)

C2T23/2/JL	36	13/2/90
Dob ins on ( 2)

MR GILLARD (continuing):  The second point we make by way

of inconsistency in our submission is the property

may be - that should be vested - in the custodian.

That should be paragraph 2 of the Order of

10 November 1987. We submit that the Conrrnonwealth>

the property is to remain the property of the

association.

The next point we make is that under the Victorian provisions, the custodian has control

and right to deal with the properfy as he considers

desirable. That is a very wide discretion.

Your Honours should add after the reference to the

paragraphs also 3, 4 and 5 of the Order of

10 November 1987. We submit that under the

Conrrnonwealth the property and funds to be administered in accordance with the constitution and rules.

The fourth point we make is that paragraphs 2 and

4 of the Victorian provisions of 13 October 1987
and paragraphs 4 and 6 of the Order of 10 November
1987 gives Dr Sharp an absolute discretion to decide

whether he should pay or not pay, and whether that

is any debt or obligation, that he may set aside

any payments or dispositions.

Pausing there, Your Honours, we submit that

in the end it is a matter for him as to whether or

not he will pay the debt or liability of the BLF.

This is paragraph 5. Sorry, it is paragraphs 4 and 5.

Your Honours will see where I have got Roman numeral

4 there on page 6, should read, the second line,

paragraphs 4 and 5 or the Order of 10 November 1987.

And paragraph 5 being the more important one for

the purpose of what we are putting to the Court,

it provides - this is at page 29:

The Custodian may pay out of the funds or property of BLF any debt or liability of

BLF or of its members as such which is

established to this satisfaction.

This raises the question whether or not Dr Sharp

could appear as an interested person in any

application brought in the Federal Court under

sectio.n 143 ( 6) .

GAUDRON J:  But that question does not arise in this case,

does it, Mr Gillard?

MR GILLARD: It has not arisen to date, Your Honour, That, with

respect, is correct.

GAUDRON J: No, we assume it does not really arise. What you

are looking at there is, I mean, is of a possibility

of what is called operational inconsistency.

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Dobinson(2)

MR GILLARD:  Yes.

GAUDRON J: Either you stand or fall on your overall direct inconsistency by reference to title or custody or

by reference to a cover thefield, not by reference

to the problems that may arise in this regard,

do you?

MR GILLARD:  Yes, I respectfully agree with Your Honour.

GAUDRON J: It may have bearing on the cover the field argument.

MR GILLARD:  Your Honour, it does raise the question whether

or not he could object to an order being made by

the Federal Court that a debt is to be satisfied out

of the funds of the association on the basis that

the law gives him the right-to decide whether or not

a particular debt or liability should be satisfied

and it is not a matter for the Court to make an

order because he has considered the matter and come

to the view that it has not been established to his

satisfaction.

(Continued on page 39)

C2T24/2/LW	38	13/2/90
(Dobinson(2)

MR GILLARD (continuing): And one could envisage a set of circumstances

where a creditor may sue in the Supreme Court of Victoria

and the association may not

BRENNAN J: Sue whom?

MR GILLARD: Sue the incorporated association for a debt.

BRENNAN J:  How would the unincorporated association be liable?

MR GILLARD: This would be in respect of a debt that

occurred before the cancellation and the debt has

not been paid so - - -

BRENNAN J: A different debtor.

MR GILLARD: Yes, but under the terms of the provision it

would be our submission that the creditor could

sue the association for the ·pre-existing debt and

that that is one of the objects of section 143(6)

and that the order is made against the association.

The association does not defend the proceedings.
The creditor then seeks to go to the Federal Court for an order that the judgment be satisfied out

of the funds and property of the BLF.

BRENNAN J: But the Supreme Court of Victoria has no jurisdiction

under section 143(6).

MR GILLARD:	I accept that so far as making application to court is concerned, that, with respect,is correct ,
but if one was to confine that right to go to the execution of the judgment then the question may
arise as to where one should go to sue the ·
unincorporated association for an order with respect
to a debt that occurred prior to the cancellation.

BRENNAN J: This seems to me to be perhaps the most difficult

area in the case, Mr Gillard 1 but 143(6) so far

as it relates to the order made by the court,

is a qualification upon the vesting of the

property, is it not?

MR GILLARD: Yes, the property is subject to any orders made

subsequently and in that sense it is some

qualification on the property. The question would

then arise as to where the creditor would go to

prove his debt. One would expect that a court would

say, ''Well, the Federal Court is clearly seized with the execution',',· and we would: imply that~ you would go to that

court to prove your debt. In other words .. there are two steps.

You have got to prove your debt - or you :nay hav~ to prove your debt because it is disputed -_and then the next question

is execution ..

BRENNAN J: There are two ways of looking at it, are there not?

One is that the only property which is vested in

the unincorporated association is that which is free

C2T25/l/CM	39	13/2/90
Dobinson(2)

of the Federal Court's Orders and that therefore

is all that Dr Sharp ever got and so there is no

possibility of conflict between Dr Sharp and the

Federal Court. The other way of looking at it is

that all the property goes to the unincorporated

association and from there to Dr Sharp and then you

have got the provision of the Victorian law which

says Dr Sharp shall say who shall be paid and the

provision of the federal law which says that the

Federal Court shall say who shall be paid.

MR GILLARD:  Yes, we submit it is the latter, for obvious

reasons,and that it does bring it into conflict that

Victorian provision does give the power to Dr Sharp to decide in his discretion as to whether or not

a debt or a liability should be paid and,in our

submission, one would expect:. that one would go to

the Federal Court, establish one's debt and then

seek the further Order that the property should

be used to satisfy that judgment. Now, all types

of difficult questions would arise as to whether

Dr Sharp could be heard on the first point as to

whether or not there was a debt. No doubt he would

strongly argue that under the State law he is

entitled to be heard on the second point, namely

the execution.

(Continued on page 41)

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Dobinson(2)

MR GILLARD (continuing):  In our submission, that highlights

that there is the conflict between his powers that

he is given under the State. laws and what may be

done under section 143(6).

Your Honours, the principles that guide the

Court in these types of proceedings are well

known to the Court.	I do not wish to go through
them.	I refer Your Honours to what Mr Justice Dixon

said in VICTORIA V THE COMMONWEALTH, (1937). 58 CLR 630

where he uses the words which have been referred to

a number of times in recent cases. At page 630:

When a State law, if valid, would alter,

impair or detract from the operation of

of a law of the Commonwealth Parliament,

then to that extent it-is invalid.

Now, in,that paragraph, he does summarize what he

said in EX PARTE McLEAN, (1930) 43 CLR 472 at 483

and that summary we rely upon there.

Now, we put the case on another basis that the

Commonwealth has evinced an intention to cover the field and the field is as to what is to occur upon cancellatiort. and we submit that by looking at

Act No 7 of the Commonwealth it does cover various

aspects as to 143(4) and 143(6) of the CONCILIATION

AND ARBITRATION ACT. It covers the disqualification,

of members with respect to awards and the fact that
the association is not capable of being a party to
proceedings; that former members are not entitled
to appear. It then goes on to provide that the
cancelled body or the deregistered body is not

entitled to apply for a period of five years and

it sets out the eligibility of certain former

members of the organization becoming members of

other bodies.

Now, in our submission, section 143(6) makes

it clear that the Commonwealth was laying down the

law with respect to what was to happen to the

property and how it was to be applied and, in our
submission, these Victorian set of laws seeks to

enter into that field as to what is to take place

pending the re-registration and we submit that

the Victorian legislature has entered the fidld

covered by the Commonwealth legislation.

Your Honours, with respect to what the

learned trial judge said, he said various things

at-the remove book, pages 37 and following and

we submit that for the reasons that we have already

stated to the Court that he was wrong and that

in the circumstances there is an inconsistency,

a textual inconsistency, and also an inconsistency

so far as covering the field is concerned.

C2T26/l/SH	41	13/2/90
Dobinson(2)

What we would seek by way of orders is that

the appeal be allowed and that there be judgment

for the plaintiff in the form of a declaration;

that the order· of the Governor in Council dated

13 October 1987 and paragraphs 1 to 7 - I will

rephrase that - the order of the Governor in Council

dated 13 October 1987, as amended by the order of
the Governor in Council dated 17 May 1988 and

paragraphs l to 7 of the order dated 10 November 1987

are invalid as being inconsistent with the provisions

of the Act No 7 of the Commonwealth. They are the

submissions we wish to put to the Court.

(Continued on page 43)

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BRENNAN J:	Thank you, Mr Gillard.	Mr Solicitor.
MR BERKELEY:	I hand up my outline	of argument, Your Honours,

thank you.

BRENNAN J: Yes, Mr Solicitor.

MR BERKELEY:  I will start off, Your Honours, by making some observations about subsection of - if

I can refer to it as - the Commonwealth Act which

is section 143 ( 6) , which is page 7 of the bundle,

and, clearly enough the purpose of the section

is clear enough, because if the registration of the

organization was cancelled, it is not right, we would say, with respect toYour Honour Mr Justice Toohey, to

say there is a change of status. The organization

ceases to exist: it is gone, and if there were no

statutory provision for the consequences, the

property of the organization would be bona vacantia,

vested in the Crown. Now, what Parliament has done
is to say, only associations - if one looks at the

definition of "association", and the provisions of

section 132, one sees that only associations of

employees - that is, unincorporated bodies of

employees - can apply to be registered, and when the

word'~ssociatiod'is used in subsection (6) our

submission is that that means the association which

applied to registered as an organization, or for

registration.

Now, the section says:

The property of the organization shall .....

be the property of the association.

And there is no element of futurity in the

word "shall", it is a direction. It is the

synonym for "must", and also "shall be held",

"must", "be held and applied for the purposes

of the association".

And, secondly, we would adop4 with respect,

what Your Honour Justice Brennan suggested and that

is that the power given to the Federal Court to make
orders with respect to the liabilities of the
organization comes into existence prior to the

passing of the property. It only passes subject to

that power and that all the association gets is

such estate or interest in those property and funds

as exists apart from the liability for payment of

the debts of the organization, and no - - -

BRENNAN J: It has some real conceptual difficulties, does

it not?

MR BERKELEY: Well, in effect it is akin to a statutory

charge, Your Honour. There are conceptual difficulties,

C2T27/l/FK	43	13/2/90
Dobinson(2)

but why we say that is this: that if Your Honour looks, no person - nobody - becomes liable for

those debts and obligations. Nobody can be sued

for them, and it does not say the property vested in

the association because it is unincorporated.

There may be some rules somewhere which indicate where

it ought to go to and, actually, those provisions were

considered by the Full Federal Court in a joint

judgment in a case called BACON V O'DEA, 88 ALR 486,

in relation to the BLF and the consequences and how
subsection (6) was to operate in respect to the

leasing of some property. There was a dispute

about it between the Australian Capital Territory

branch and the federal association, and the working

out of that as far as passing of property is concerned

was considered by the Full Federal Court in cases not

directly relevant to this case.

(Continued on page 45)

C2T27/2/FK	44	13/2/90
Dobinson(2)

MR BERKELEY (continuing):  But no person becomes liable.

Nobody can be sued for any debts. There is not any

person to be sued but the property can be used for

that purpose and in theory we would say the property

can be followed anywhere. If whoever is the owner of

it disposes of it in accordance with the rules of the

association, as a matter of power, that property in

the hands of any subsequent owner or purchaser could

be realized to pay the debts of the organization

not, we notice, the debts of the association,	the
debts, that is the pre-existing debts of the organization as at the date of cancellation or

dissolution and the guard against that working an

injustice, in our submission, is to be found in the

fact that the power to make orders is given to a court

..	to be exercised judicially and, no doubt, if,
without any impropriety the P!Operty pass to a bona fide purchaser for value and without notice the court would not make an order in respect to that property, but that would, in our submission, be a matter of
0	discretion and not due to any lack of power.

So the property is made liable and without any

limitation and there is no need to read any limitation

in because of the body which has the power to make

orders.

BRENNAN J:  You equate this power of the Federal Court to a

charge, I think you said.

MR BERKELEY:  Well, it is terribly elliptical and unsatisfactory

but it has got to be made workable. One thing that

occurs to us, one would go to - the court might appoint

a receiver to take the property and realize it and

pay the debt out of the proceeds of realization

and to pay the balance to whoever was entitled to

hold the property of the association. It is not spelt
out and the court is a superior court, it would have

to work out its own machinery.

BRENNAN J:  The difficulty that I see with the power - I

appreciate entirely your reference to the elliptical

nature of the provision - but where is the title to

the property at the moment after dissolution?

MR BERKELEY:  In . . . . . . It is no use my looking up there

either. I am sure I will not find the answer.

Your Honour, it may be nowhere because if it is

vested - take land, for simplistic sake. If the

organization is the alleged proprietor of land, it
is begging the question to say the title is in the

organization. It has gone, but if one looks at the

rules of the association, one may find provisions

which allow property to be acquired on behalf of the -

there may be no provision. Let us assume there is no provision and the rules say, "All the property of the

organization is to be held in the name of the

organization"; well, some provision would have to be

C2T28/l/HS	45	13/2/90
Dobinson(2)

made. They would have to appoint trustees. They

would have to go, one would think, to the supreme

court - not the Federal Court - they would have to go

to the supreme court and get vesting orders because

~tie Corrm~nwealth Act clearly provides that the

properties be held for the purposes of the association

and in accordance with its constitutional laws.

BRENNAN J:  Let that be so. They either appoint trustees

or there is tenants in common, or something of that

sort, and then a claim is made.

MR BERKELEY:  To the Federal Court?

• BRENNAN J: Yes. Well, a claim is made by a printer who says,

"Here's last month's account!' ..

MR BERKELEY:  Yes, Your Honour. This is for the debts of the

organization?

BRENNAN J:	Debts of the corporation.
MR BERKELEY:	Yes, Your Honour. Well, one would assume it would

not be a breach of trust for the trustees to pay that debt because the court could compel them to pay it or

at lease seize their property and if they voluntarily

paid a debt to avoid the seizure of the property,

t would be prepared to assume and submit that that

could not possibly be a breach of trust but, if absent

that, then the printer's only remedy is to go to the

Federal Court.

BRENNAN J:	Well, in these circumstances the property has gone to the unincorporated association. Under force of the
Victorian Act it  has been vested in Dr Sharp -
has not been vested in,  perhaps ,it is under the
control of Dr Sharp- andDr Sharp is given the
exclusive power of determining whom to pay.

(Continued on page 47)

C2T28/2/HS	46	13/2/90
Dobinson(2)

MR BERKELEY:  Your Honour, that begs the question that I

would like to come to next, if I may.

BRENNAN J:	I am sorry, yes.
MR BERKELEY:	And, if I do not answer it may I ask

Your Honour to remind me about it but I am sure

I shall deal with it very shortly.

Could I go to page 16 of this bundle and take the Court to section 3 of the Victorian Act.

Now, they have defined BLF in a variety of ways and

we can straight away cross a blue pencil out·

through (b) and (c)(ii) because my understanding

is that there were no such orders made so that the

alternatives we have there are the organization and

the association. Your Honours_ will remember that the

Order in Council gave Dr Sharp custody of the property

and funds of BLF.	Now, at that time the organization
had long ceased to exist.	It did not have any
property or funds.	The only body that had any property

or funds was the association and, in our submission,

when he was given - that is what was vested in him

and when section 7 says that:

the Governor in Council may -

make an order for the control -

of funds or property of BLF -

one should assume on ordinary rules of construction.

that means of such interest or estate in property

as BLF has. That is to say, it ought to be assumed

that Parliament did not, for instance, intend to

or if there was a lease of a chattel of which the	deprive a mortgagee of his interest in property deprive the lessor, or if there was a tenant of a
building, it did not intend to deprive the tenant of
his tenancy.
control of is the estate or interest in property that So that all that Dr Sharp gets
BLF has and that means the association. And that
when he is directed or given discretion to pay the
debts of BLF that word should have the same meaning as the word which gives control of property, that is, the debts and obligations of the association~not of the organization which has ceased to exist.

BRENNAN J:  What is the meaning in section 7(1) of:

persons who have ceased to be members of

BLF -

in that context?

C2T29/l/JH	47	13/2/90
Dobinson( 2)

MR BERKELEY:  Yes, that troubled me and my juniors last night,

Your Honour. We did not come up with an answer

because there is no reason why that should not there

mean the organization. It is a terribly akward Act

but - - -

DAWSON J: 

I suppose you say it is speaking in the past as

well as the present so, therefore, it could include
the organization;. both limbs of the definition.

MR BERKELEY: 

Yes, Your Honour. But, when one talks about

the control of funds and property and when the Order

in Council gives control of funds and property of

BLF, that has to mean the association and not the

corporation.

• DAWSON J: Because you are speaking in the present.

MR BERKELEY:  And, there is no corporation and there are no

funds or property of the corporation.

DAWSON J:  Yes.

MR BERKELEY:  Section 1 was proclaimed to come into operation

long after the organization, that is the corporation,

ceased to exist.

(Continued on page 49)

C2T29/2/JH	48	13/2/90
Dobinson ( 2)

MR BERKELEY (continued):  So our submission is that there

is no possibility of conflict. There are two areas

here . There is the property that Dr Sharp. has cont r o 1 of ,

which is the property subject to the liability for

payment of the debts and he is commanded to pay

the debts of the association and what the Federal Court

has power of is the order for payment of the debts

of the organization and they never meet on pararrel

lines. But even if we are wrong about that, our

submission is that no question of inconsistency

can arise until the Federal Court exercises the

power which is given to it by section 143(6) and

that is based upon the principle which was stated,

if we might say, with respect, su~cinct_ ly, by

His Honour the Chief Justice in THE QUEEN V WINNEKE,

152 CLR 211, and the particular passage, if I may

read it,is page 221, where His Honour is talking about powers which may be said to conflict or as

I think Your Honour Justice Brennan put it in

FLAHERTY's case "facultative legislation".

0 About - shortly before the middle of the page; page 221:

Another illustration is the Commonwealth

power to acquire property for Commonwealth

purposes on just terms; it is distinct from,

and independent of, the State power to acquire

property for State purposes. But here

inconsistency can arise if, in the exercise

of statutory powers, the Commonwealth and a

State attempt to acquire the one property.

In cases of this kind, which arise out of the

coexistence of Commonwealth and State powers

potentially capable of being exercised with

respect to the same property, no inconsistency
will arise until the powers are actually

exercised.

And that principle originally came from THE KAKARIKI

which was a power to deal with maritime rates

where both the Commonwealth minister and the State

minister had power and Your Honours will remember
the facts of it.	The State minister having exercised

the powers sought to recover the costs from the

owner of the ship and it was put by the owner that

because of section 109 the State Act was invalid,
but the Commonwealth minister never attempted to

exercise his power and the Court held that

section 109 requires the State Act to be invalid

only to the extent of the inconsistency and there

was no inconsistency until it was sought to

exercise both powers in respect to the same shipwreck

and CARTER's case was a power to acquire eggs

compulsorily and the Court held the same way. Now in

this case the Governor in Council is given a power

to make an order with respect to the property and

let us assume that we are wrong and the Federal Court

C2T30/l/CM	49	13/2/90
Dobinson(2)

is given power to make an order with respect to

the same property. In our submission, no question

of equal consistency can arise unless and until the done so. It has not been asked to do so.

Lastly, there is no relevant field here that

the Commonwealth has sought to occupyj·

(Continued on page 51)

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Dobinson(2)

MR BERKELEY (continuing):  The Commonwealth Act does not

purport to state the whole law about the consequences

of deregistration or the status - it does not say

anything about the status of the associaton: that

depends on State law. And it does not say anything

about the relationship - the continuing relationship -

between the association and its property and nor

does it state the whole of the law about the payments

of the debts of the organization. It does not say

how those debts are to be ascertained; what principles

of law shall be applied; what the limitation Acts

are. All it states is the method of payment.

DAWSON J: Is there a_ State law allowing unincorporated

associations to sue and be sued?

MR BERKELEY:  The only thing that occurs to me, Your Honour,

is the representative parts that have been called

rules, representative orders.

DAWSON J: There is no Act as there is in other States?

MR BERKELEY: There is not one that comes to my mind,

Your Honour, no, not as far as we know, Your Honour.

DAWSON J: There is an Act allowing associations?

MR BERKELEY:	ASSOCIATIONS INCORPORATION ACT.
DAWSON J: Yes.
MR BERKELEY:	I think, just speaking from memory, it is expressed

not to apply to trade unions. I am not sure about

that because there is a separate Act - Victorian Act

dealing with trade unions. Your Honour Justice McHugh

adverted to the possibility that if the Court were

against us it might be necessary to look at the State

Act distributively. There is a very wide !NTERPRETATICN

CF LEGISLATICN AeT in Victoria which is far wider

than the Commonwealth Act and I have had that section

.photocopied and if it is convenient I will hand up

copies of that to Your Honours. That concludes what

we want to say, if the Court pleases.

BRENNAN J: Thank you, Mr Solicitor. Mr Hardingham?

MR HARDINGHAM:	I have nothing to say.
BRENNAN J:	Mr Gillard?
MR GILLARD:	No, we have nothing in reply, Your Honour.
BRENNAN J: The Court will consider its judgment in this	matter and will adjourn until 10.15 am tomorrow.

AT 12.12 PM THE MATTER WAS ADJOURNED SINE DIE

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