In the matter of the Conciliation and Arbitration Act 1904 and in the matter of an application pursuant to section 171C of the said Act Plumbers and Gasfitters Employees Union of Australia & Ors v Cook, Robert Arthur

IN THE FEDERAL COURT

OF AUSTRALIA )

INDUSTRIAL	DIVISION	)	NO. V 24 Of	1979
1

VICTORIA

D STRICT

REGISTRY

)

IN THE MATTER of the Conciliation

& Arbltration Act,

1904

AND IN THE MATTER of an Applicatlon pursuant to sectlon 171C of the said Act

BETWEEN :

THE PLUMBERS

AND GASFITTERS EMPLOYEES'

UNION OF AUSTRALIA, G. CRAWFORD,

G.L. SMITH, R. FAIRWEATHER, R. HEVEY

T. BOURKE and

S . MUTTON

Applicants

and

Respondents

ORDER

JUDGE MAKING ORDER: EVATT J.

DATE OF ORDER	15 JUNE 1984
WHERE MADE:	SYDNEY

On the facts before the Court includlng the facts

as determined by the Court

as presently constituted In

matter No. 19 of 1979 (Cook & Ors. v. Crawford & Ors.(1981)

52 F.L.R. l), the Court is

of the opmion that invalldltles

have occurred in the maklng or alteratlon

of the rules of

the Plumbers and Gasfitters Employees' Unlon of Australla

(the organization) and	In the management or administration
of the organization.

Accordlngly, the Court hereby determlnes and declares:

(i) That invalidities have occurred in the maklng or

alteratlons of rr. 6 (3) and ( 4 ) ,

8 ,

13,

1 8 ,

1 9 ,

2 1 ,

Z l A ,

2 2 ,

2 3 ,

2 4 ,

2 5 ,

2 6 ,

2 7 ,

2 9 ,

3 0 ,

31, 3 2 ,

' .

3 3 ,

3 4 ,

35,

3 6 ,

4 2 ,

4 3 ,

4 7 ,

48 ,

48A,

48B,

48C,

51, 5 4 ,

55,

5 6 ,

56A,

5 9 ,

6 0 ,

6 5

and 6 7 as

certified by the Industrial Registrar

on 2 5

October 1 9 7 8 by reason	of non-compliance with the	8 1
!

rules of the organization, and	I
!

(li) That invaliditles have occurred

m the

management or admmistration of the organlzation

being the resolutions dated

2 May

1 9 7 9 of the

Federal Executive of the organizatlon

(a)

To dismiss Ulrich Colin Bignell from the

office of Branch Secretary of the Sydney

Branch of the organlzation (the Branch),

(b) To dismiss Harold Shooter from the offlce

of Assrstant Secretary of the Branch,

(c)	To dismiss Royce Lawrence Cummlns, Kenneth

Lewls Tyler and Gregory Lawrence Waters and

each of them from the offrce

of organizer

for the Branch,

(d)	To expel the said Ulrich Colin Bignell,
Kenneth Lewis Tyler and Gregory Lawrence

Harold Shooter, Royce Lawrence Cummins, the organlzatlon,

by reason of the invalldlty found to exlst in the

making or alterations of the aforesaid rules and

in partlcular rr . 13

( 6 ) and 3 5 .

AND the Court, being satisfied that the order

herein made would not

do substantlal in]ustrce to the

organization or to any member or creditor

of the

organization or to

any person having dealings wlth the

organization, ORDERS THAT:

(i) The making or alteratlons

the aforesald rules

be, and the same are hereby validated,

(il) The aforesald resolutions of the Federal

Executive of the organization made on

2 May 1979

be, and the same are hereby validated

IN THE FEDERAL COURT

OF AUSTRALIA )

INDUSTRIAL

D VISION

No. V 24 of 1979

)

VICTORIA

D STRICT

RECISTI<Y

IN THE MATTER of the Conclllatlon

& Arbitratlon Act,

1904

AND IN THE MATTER of an Appllcatlon pursuant to section 171C of the said Act

BETWEEN

Applicants

and

Respondents

15 June 1984

EVATT J.

REASONS FOR JUDGMENT

In August 1978 a

specially convened meetlng

the Federal Council

of the Plumbers and Gasfltters

Employees' Union of Australia, (the organization), an organization reglstered under the Conciliatlon and

Arbltration Act 1904, (the Act), was held

to consider and

adopt several rule amendments. At that time the certified

rule-amendlng rule

of the organization was r

27 whlch read:-

“27 (1)

The Rules of the Union shall not be

amended except on

a resolutlon carried

by a majorlty of the Council,

(2 )

Any member desiring to submit to the

Councll any proposal to amend the Rules

must first submit such proposal to the

meeting of his Branch specially convened

for the purpose,

( 3 )

If such proposal be approved

by a

ma~ority

of the members present at such

meeting It shall be forwarded to the

Head Offxe for submisslon to the

Council,

( 4 )

The General Secretary shall prepare an

agenda of any such proposals and forward

copies of same to all Branches, not less

’

than six (6) weeks prlor to the Councll meetings to which such proposals are submltted,

(5)

The Council may at any time make or

amend any rules.

”

Some of the rule amendments considered

by the

1978 Council had been proposed by meetings

of elther the

West Australian

or the Melbourne branch

of the

organization; were redrafts of amendments made

by the 1975

or 1977 Federal Councll

or were new amendments drafted

after discussion by members

of the Council. Thereafter

the Solicitor for the Organization drafted all the proposed

amendments which were set out in a document labelled

Document R. The Council then proceeded to vote on each

amendment in Document

R separately. (Document R 1s

referred to in Cook

L Ors v. Crawford L Ors. (1981) 52

F.L.R.

1 at pp

15 & 24.)

After discussion numerous

amendments to the rules were in fact adopted by that

Council. These amendments were subsequently lodged by the

General Secretary of the organization with the Industrlal

Registrar in accordance with the Regulations made under the	,
Act for certification by the Registrar pursuant to

S 139 (4) of the Act.

The Registrar lssued his certiflcate

in respect of the sald amendments on 25 October 1978.

Rule 27 as set out above, partlcularly sub-r.(5), is to be contrasted wlth the earlier rule-amending rule of the organizatlon (then r.28) which was consldered by

the Court in Roots

v. Mutton (1978) 32 F.L.R.15.

The

earlier rule had been amended by the Federal Council In

1977 with the result that the rule had been re-numbered

r. 27 and a new sub-r.

(5 ) as set out above being

Inserted. These and other amendments had been certlfled

under S 139 ( 4 1 of the Act on

1 February 1978.

On 1 and 2 May 1979 certain members of the

Pedcral Exccutivc, (the Exccutlvc),

of thc organlzatlon

heard charges lald by a member of the organization agalnst of the organization, claimed that the particular officers

flve other members who were at that time holders of certaln

offices within the Sydney Branch of the organizatlon, (the

Sydney Branch). These five officers also held slmilar

offices in a New South Wales State Union then styled the

"New South Wales Plumbers and Gasfitters Employees' Union."

were guilty of gross misbehaviour

as set out in

the charges

and called for penalties in accordance with the then

certifled rules. One of the said flve officers was

Kenneth Lewis Tyler

On 2 May 1979 the Executive found each

of the flve

officers guilty as charged and determlned that each be

dismissed from his respective office

or offices withln the

organization and expelled therefrom. Some

of the rules

relied upon as the basls for the said charges and for the

penalties lmposed were rules whlch had been adopted by the

Federal Council at Its

1978 special meeting.

On 31 May 1979 an order-nisi (No. 19 of 1979) was

granted pursuant to

S 141 of the Act to Robert Arthur

Cook the then Chairman

of the Sydney Branch wherein orders

were sought that the named respondents therein, being

members of the Federal Council and Federal Executlve,

perform and observe the rules

of the organization in

certain respects and recognize the five dismissed and

expelled officers of the Branch as Branch officers. Those

proceedings were determined by the Court as presently

constituted, on 4 March

1981, the order-nisi being

discharged (Cook & Ors. v. Crawford & Ors.

(1981) 52 F.L.R.

1.) Each of the five Branch officers who had become

parties to those proceedings appealed against that

decision.

On 7 July 1982 the Full Court of the Court made

certam

determinations including a determination that certain

rules relevant

to the said charges which had been adopted

by the Federal Council at its meeting in August

1978

had been invalidly adopted. The Full Court in the

exercise of its discretion made no orders and subsequently

on 6 August 1982 dismissed the appeal. (Cook & Ors. v.

Crawford & Ors. (1982) 43 A.L.R.

83.)

On 27 June 1979 shortly after the commencement

of the abovementioned proceedings the present appllcation pursuant to S 171C of the Act was filed on behalf of the organization and certain Federal officers. Such

proceedings were numbered

V 24 of 1979. These

proceedlngs sought certaln

validatmg orders should the

Court determine that invalidities had occurred

In (inter

alia) the making

or alteration of the rules

of the

organlzation by the 1978 Federal Council. On

September 1979 the Court as presently constituted dlrected

that the said five Branch officers be added

s respondents

to the

S 171C proceedings and ordered that those

proceedings be heard together with the substantive

application under S 141 (No. 19 of 1979).

Consequent upon the Court at first instance

handing down Its determlnation in the substantive matter

the S 171C application was stood over generally pending

the determination of the appeal in matter

No. 19 of 1979.

After the dlsmissal

of the

sald appeal the present

validating application was restored to the llst for

directions on

2 September 1982. At that time Mr Wright of

Counsel who had appeared

on behalf of the said five

officers of the Sydney Branch

In the substantive matter

agaln appeared for those officers.

Pursuant to directions made by the Court on

2 September 1982 notice

of the application under

S 171C

was published in the organization‘s journal, “Plumbers‘

News", which was forwarded to all members of the

organizatlon In Scptembcr, 1982.

In addltlon,

advertisements were placed in numerous newspapers

circulating throughout Australia glvlng details of the

application. The said notlce and advertlsements lndlcated

that any person who wlshed to contend that an invalidlty

had or may have occurred in the amending

of the rules

the organlzation or In the management or admlnlstratlon

of the organlzation was lnvlted to contact the Dlstrlct

Registrar at any District Registry of the Federal Court of

Australia withln Australla and enter

an appearance in the

matter on or before a certain date.

On 2 September the matter was stood over untll

November 1982 for further directions. On the latter date nor his instructlng Solicltors had lnstructions to further appear In the matter and appeared that day simply out of courtesy to the Court, wlthdrew. After hearing further

submissions	from	Counsel	for	the	Applicants	further	i
!

directions were made and the matter was fixed for hearlng

for 2 February 1983.

When the present matter was called

on for hearing

on 2 February 1983 Mr Johnston of Counsel appeared

behalf of Mr Tyler. There	was no appearance for any of
the other four officers.

Mr Tyler had flled a notice of motion in the

present proceedings on 25 January 1983.

Such notice of

motion asked that the application for valldation of the

rule amendments be

re~ected

and that offlclals

of the

organization perform and observe the rules of the

organlzation by paying all monies due

to him for long-

service leave and retlrement allowance. Subsequently on

2 February 1983 an affidavit sworn

on 1 February 1983 by

Mr Tyler and stated

to be in support

of the notice of motion

was flled. The effect of the affidavlt is such that Mr

Tyler feared that lf the amendment made

to r. 50 adopted

by the 1978 council was valldated then he would be deprlved

of hls long-service leave payments and retirement allowances

which two sums he claimed exceeded thlrty thousand dollars I

($30,000.00). He stated that he became a full-tlme

organizor of the Unlon on 3 June 1958 and remalned a

full-time officlal until his dlsmissal on	2 May 1979,
a perlod in excess of twenty years.

Rule 50 prlor to the amendments thereto made in

August 1978 read:

"50 (a) A Retlring Allowance shall

be pald of not

less than an amount equal to one year's

salary for paid officers

of the Federal

Council or full-time officers

of Branches

after twenty (20) years' servlce or pro rata

after one year's service. In the case

part-tlme paid offlcers

of Branches the

pro rata payment shall apply after five

( 5 )

years' service. Retrospectlve service

all paid officers who are at present paid

offlcers of the Federal Council and Branches

shall be taken into account in assessing

retirlng allowance and long-servlce leave	of
such paid officers,

(b)

Long-servlce leave of nine

(9) months

duration on full pay after twenty

(20 )

years service or

pro rata after five

( 5 )

years service shall apply to retrospective

servlce of all paid officers

of the Councll

and Branches and shall

be taken into account

ln assessing the foregoing conditions.

Pro rata long-servlce leave may be taken

after ten (10) years servlce wlth the

permlsslon of the Council in the case of

a paid officer

of the Councll and In the

case of a paid officer of the Branch	by the
Branch,

General Secretary In the case of a paid

offlcer of Federal Council and by the

respective Branch in the case of paid

offlcers of the respective Branches.

service leave shall be made to the provided by Rule ( 4 2 ) Clause (e),

(d) Pald officers of the Federal Councll or

the Branches shall have the right	to retire
on the foregoing conditions,

(e) The aforesaid conditions shall apply to

pald officers

of the Federal Councll and

Branches in the case of removal from offlce due to death, sickness, voluntary

retirement, ballot or

In any other

circumstances within the Rules of the Union,

(f)	A paid officer of the Federal Council or Branch removed from office due to mlsconduct , withln the rules of the Federal Council

or Branch shall have the right of appeal

agalnst such decislon of the Executive

of the Federal Council

or the

Committee of Management of the respectlve

Branch,

(i) In the case of the paid officer of the Federal Council to the Federal Councll,

(li) In the case

of the pald offlcer

the Branch to the Executlve

of the

Federal Council.

Rule 50 was amended by the 1978 Council, the

amendment being certified by the Industrial Registrar on

25 October 1978. The amended rule reads:

"50 (a) A Retiring Allowance shall be pald of not

less than an amount equal

to one year's

salary to paid officers of the Federal

Council or full-time officers

of Branches

after twenty (20 ) years' servlce or pro rata

after one year's service. In the case of

part-tlme paid officers

of Branches the

pro rata payment shall apply after five

(5)

years' servlce. Retrospective service

all paid officers who are a$ present pald

officers of the Federal Council and

Branches shall be taken into account

in assessing retlring allowance and long-

servlce leave of such pald officer,

(b) Long-service leave

of nine ( 9 ) months'

duration on full pay after twenty

( 2 0 )

years' servlce or pro rata after three

( 3 )

years' service shall apply to retrospective

servlce of all pald officers of the Council

and Branches and shall be taken into account

In assessing the foregoing condltions,

Pro rata long-service leave may be taken

after three years' servlce wlth the

permlsslon of the Council in the case of

a paid officer

of the Council and in the

case of a paid offlcer of the Branch by the	'
Branch,

(c)

Clams for such retiring allowance and long-service leave shall be made to the General Secretary in the case of a pald

officer of Federal Council

and by the

respectlve Branch In the case

of pald

officers of the respective Branches,

All payments to be made

from fund

provided by Rules 42 and

4 3 ,

(d) Paid offlcers

of the Federal Council or the

Branches shall have the right to retire

on the foregomg condltions which shall apply

in the event

of their ceasing to hold office

due to death, slckness, voluntary retirement

or expiry of thelr term

of office

provided that such conditions shall not

apply and there shall be no such

entltlement in respect of

an officer

removed from office havlng been found gullty

of misappropriatlon of the funds of the

Unlon or gross misbehavlour

or gross

neglect of duty in accordance with the

Rules.

Section 171C of the Act reads:

"(1)

organization, a member of an

organization or any person having a sufficient

interest In respect of an organlzation may

apply to the Court for a determination of

the questlon whether an invalidity has

occurred in the management

or admlnistration

of the organization or f a branch of the organizatlon or In an election or

appointment in, or the making

alteratlon of the rules

of, the

organization or a branch

of the

organization and the Court has

jurlsdictlon to hear and determine the

appllcatlon and to make such declaration as

it thinks proper,

(2 )

Where, In proceedings under sub-sectlon (l),

the Court finds that an invalidity of the

kind referred to in that sub-section has

occurred, the Court

(a)	May make such order as it thlnks

fit to rectify or cause to

rectlfled the lnvalidity,

or to

negatlve, modify

or cause to be

modified the consequences in law of

the invalidity,

or to validate any

act, matter or thing rendered lnvalid

by or as a result

of the invalldlty;

(b)	satisfy itself that such an order would not do substantial injustlce to the organizatlon or to any member or credltor of the organization , ’

Shall, before making such order, wlth the organizatlon;

(C)

Where any such order

1s made,

may give such ancillary

consequentlal directions as It	!
thinks fit; and

(a)

May determine what notice, summons

or rule

to show cause is to be given

to other persons of the intention

to make such an order, and whether

and how it should be given or served

and whether it should

be advertised

In any newspaper.

( 3 ) . . . . . . . . "

Certain findings

of fact were made

by me in

matter No. 19 of 1979. As I understand It the Court

hearing the appeal in that matter did not disturb any

those findings of fact. Such findings have been

considered by me in the present proceedings and have

formed part of my reasons for Judgment herein.

Accordmgly, my reasons for judgment in Cook

& Ors. v.

Crawford & Ors.(supra) should be read in con~unction

with

these reasons and

I find lt unnecessary to set out In

detail the factual matters leading up to the dispute

which occurred between the officials

of the Sydney

Branch of the organization and the organization itself

which culminated in the hearing of the said charges and

the dismissal from offlce and expulsion from the

organizatlon of the sald flve officers of the Sydney

Branch. Further, the findings that none of the members of

the Executive who heard the charges nor the member who

laid the charges was blased is taken into account in the

present proceedings. Further, the reasons for ~udgment

of the members of the Court in the appeal in matter

No. 19 of 1979 and that Court's order together with the

determinations of the Court In Wright L Anor. v. McLeod & Ors. (1983) 51 A.L.R. 483 have been consldered by me

In the exercise of my discretion in the present matter.

I am satlsfied that the amendments made by the

Federal Council at its meeting in August

1978 were made

bona fide. Indeed there is no suggestion to the contrary

in any of the evldence. I accept that the specially

summoned meeting

of the Federal Council in August

1978

was called following the observations of the Court in

Roots v. Mutton (supra) at p 21 where the Court stated:

"we should however

pomt out that the rules seem

to be

in a somewhat unsatisfactory state and will inevitably

present further difflcultles

of lnterpretation both

members and officers and, in the event

of dispute, to the

Court.

It is clearly desirable that steps be taken as

soon as practicable to remove such dlfficulties," and

that the offlclals were anxlous to put the rules of

the organization in order as soon as possible. The

opportunity was then taken to restructure the organizatlon

so as to provide (inter alla)

for rank and file elections

of its officials instead

of the collegiate type

elections prevlously provided for. Further, I accept

that following the decision in Roots

v. Mutton (supra)

the officials had some reservations as to the validlty decision was taken that the Solicitor for the organizatlon

of the adoption of certaln of the amendments made by th

be invited to attend the 1978 special meeting

of Councll

to advise generally concerning the rules and redraft

earlier rules to overcome ambiguitles. As a consequence,

Document R referred to above was prepared and dealt wlth

in the way mentioned earlier.

I accept that the members

of the Federal Councll then believed that

r. 27 ( 5 )

gave the Council

an express general power

to amend the

rules. In addition the Court is mindful that consequent

upon the 1978 amendments to the rules

whuhlch brought about

the restructurlng

of the organization elections have

since been held in accordance with those amendments.

Conslderation has been glven to the general

principles that the Court has determined should be

applled in appllcatlons made under

S 171C of the Act.

1 8

Such principles include those laid down In Gordon

Carroll L Ors. (1975)

F.L.R.

129, Australian Buildlng

Construction Employees' v. Builders' Labourers' Federation

(1978) 46 F.L.R.

308, Allen v. Townsend & Ors. (1977)

31 F.L.R.

431, Tro-Ja v. Australasian Meat Industry

Employees' Union (Victorlan Branch)

(1978) 46 F.L.R.

340,

Kayne v. Banks & Ors. (1978) 22 A.L.R.

255, Sherrif & Ors.

v. Townsend & Ors. (1979) 48 F.L.R.

20.

Further, as to

the question of "substantial

mjustlce"

( S 171C

( 2 ) (b))

conslderatlon has been glven to Re Australian Continental

Resources Limited (1976) 10 A.C.T.R.

1 9 and Compaction

Systems Pty. Llmited and the Companies Act

(1976)

2 N.S.W.L.R.

477 at 492 - 3.

It 1s clear that invalldities have occurred in

the making or alteration to the rules adopted

by the 1978

Council. Dealing first with the amendments to r. 50.

am not satisfied that an order validating the amendments

made by the

1978 Council to this rule would not

substantial injustice to M r Tyler or other members. In this regard I make no determination as to whether Mr Tyler was employed by either the New South Wales State

Union or the Federal organlzation or both continuously

from 3 June 1958 until the date

of his dismissal. Again,

assuming that he was employed by both unions during this

period, no determination is made

as to whether such

employment was "full-tlme" in both unlons. Nor

1s any

determmation made that on the proper constructlon

r. 50 as amended by the

1978 Council those amendments

had any retrospectlve effect (cf Davis v. Pulp

& Paper

Workers' Pederatlon (1963) 8 F.L.R.

277),or, whcthcr

the rule as amended contravened

S 140(1) (c) of the Act.

However the Court has taken into conslderation that

an employee cannot contract himself out of the beneflts

of the

N.S.W.

State long-service leave legislatlon.

As stated above, I am satisfied that as a result

of the non-compllance wlth the then rules of the

organization invalldltles may have occurred in the maklng

or alteration of the following rules

of the organlzation

by the 1978 Federal Council whlch amendments were certified'

by the Industrlal Registrar

on 25 October 1978: rr 6(3)

and (4), 8, 13, 18, 19, 21, 21A, 22, 23, 24, 25, 26,

27, 29, 30, 31, 32, 33, 34, 35, 36,

42, 43, 47, 48, 48A,

480, 48C, 51, 54,

55, 56, 56A, 59, 60, 65 and 67.

Further, I am satisfied that an order valldatlng

those amendments would not do substantial inJustlce to

the organization or

to any member

or credltor of the

organization or to any person having dealings wlth the

organization.

Agaln, on the evldence

I am satisfied that by

reason of the lnvalldiClos round to cxzst 111 the maklng

of alteratlons

of certain rules

by the Federal Council

1978 including amendments to rr 13 and 35 lnvallditles

have occurred in the management

or admlnistratlon of the

organlzation, namely, in the resolutions dated

2 May 1979

of the Federal Executive of the organizatlon dismisslng

Ulrich Colln Bignell from the offlce

of secretary of the

Sydney Branch of the organlzatlon, dismissing Harold

Shooter from the office of assistant secretary

of the

Branch, dismissing Royce Lawrence Cummlns, Kenneth Lewis Tyler and Gregory Lawrence Waters from the offices of

organlzor of the Branch, and

expelling the sald Ulrich

Colln Blgnell, Harold Shooter, Kenneth Lewis Tyler and

Gregory Lawrence Waters from membership

of the

organization. Further, I am satisfied In all the

circumstances that an order valldatlng such resolutions

would not do substantlal injustice to the organization

or to any member or creditor of the organization or to

any person having dealings wlth the organization.

Accordingly, the making

or alterations of the

aforesaid rules by the Federal Council in August

1978

(other than those to r.

5 0 ) which were certlfied

by the

Industrial Registrar on

25 October 1978 and the

aforesaid resolutions of the Federal Executive of the organization made 2 May 1979 are validated. Declarations and orders should be made accordingly.

1 i

[1984] FCA 156

15 Jun 1984