Jolly v Sharma

Case [2025] FCAFC 20

FEDERAL COURT OF AUSTRALIA

Jolly v Sharma [2025] FCAFC 20

Appeal from: Jolly v Sharma [2024] FCA 171
File number: VID 203 of 2024
Judgment of: RANGIAH, WHEELAHAN AND RAPER JJ
Date of judgment: 4 March 2025
Catchwords: INDUSTRIAL LAW — appeal – where the primary judge dismissed application for declaratory relief – whether rules of an industrial association impose conditions, obligations or restrictions that are oppressive, unreasonable or unjust – no error by primary judge demonstrated – appeal dismissed
Legislation:

Commonwealth Conciliation and Arbitration Act 1904 (Cth) s 140(1)(c)

Fair Work Act 2009 (Cth) s 3

Fair Work (Registered Organisations) Act2009 (Cth) ss 5, 5(1), 5(2), 5(3), 9, 27(a), 60(1)(d), 94, 140(1), 141(1), 142, 142(1)(c), 143, 154A, 163, 163(1), 163(2), 163(7), 164, 164B(3), 166, 182(1), 186, 283, 286(1), 287(1) and 287

Industrial Relations Act 1988 (Cth) s 196(c)

Workplace Relations Act 1996 (Cth) s 142(1)(c)) of Sch 1 and s 196(c)

Cases cited:

Allen v Townsend (1977) 31 FLR 431

Bramich v Transport Workers Union of Australia (2000) 97 FCR 204

Cook v Crawford (1982) 43 ALR 83

Doyle v Australian Workers’ Union (1986) 12 FCR 197

Hodder v Australian Workers’ Union (1985) 9 FCR 498

Imlach v Daley (1985) 7 FCR 457

Jolly v Sharma [2024] FCA 171

McLeish v Kane (1978) 22 ALR 547

Municipal Officers’ Association of Australia v Lancaster (1981) 37 ALR 559

R v Hunt; Ex parte Sean Investments Pty Ltd (1979) 25 ALR 497

R v Spicer; Ex parte Foster (1958) 100 CLR 163

Scott v Jess (1984) 3 FCR 263

Williams v Hursey (1959) 103 CLR 30
Division: Fair Work Division
Registry: Victoria
National Practice Area: Employment and Industrial Relations
Number of paragraphs: 118
Date of hearing: 12 August 2024
Counsel for the Appellant: Mr H Borenstein KC with Mr Y Bakri
Solicitor for the Appellant: Aen Legal
Counsel for the First to Fifteenth and Twenty-Third Respondents: Mr WL Friend KC with Mr C Massy
Solicitor for the First to Fifteenth and Twenty-Third Respondents: Gordon Legal
Counsel for the Sixteenth to Twenty-Second Respondents: The Sixteenth to Twenty-Second Respondents filed submitting notices

ORDERS

VID 203 of 2024
BETWEEN:

PARIS JOLLY

Appellant
AND:

VIKRANT SHARMA

First Respondent

DARREN LAMONT

Second Respondent

BRIAN PENZA (and others named in the Schedule)

Third Respondent

ORDER MADE BY:

RANGIAH, WHEELAHAN AND RAPER JJ

DATE OF ORDER:

4 MARCH 2025

THE COURT ORDERS THAT:

1.The appeal is dismissed.

Note:   Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.


REASONS FOR JUDGMENT

Factual background

[5]

The relevant statutory provisions

[18]

The Union’s Rules

[29]

The reasons of the primary judge

[45]

The appellant’s submissions

[55]

The respondents’ submissions

[61]

Consideration

[69]

THE COURT:

  1. The appellant appeals from the judgment of a single judge of the Court in Jolly v Sharma [2024] FCA 171. By that judgment, the primary judge dismissed the appellant’s proceeding which sought declaratory and other relief against the respondents.

  2. The proceeding stems from a long-standing dispute within the…

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Details
AGLC
Jolly v Sharma [2025] FCAFC 20
Case
[2025] FCAFC 20
Decision Date

CaseChat Overview and Summary

The appellant, Jolly, who is the Secretary of the Victorian Locomotive Division (VLD), appealed against the dismissal of an application for declaratory relief. The respondents, Sharma and others, are members of the Victorian Branch Executive of the Union. The primary judge dismissed the application, finding that the rules of the Union do not impose oppressive, unreasonable or unjust conditions, obligations, or restrictions on the VLD members. The appeal was brought before the court to determine whether the primary judge made any error in dismissing the application for declaratory relief. Specifically, the appellant argued that the rules of the Union impose oppressive, unreasonable, or unjust conditions, obligations, or restrictions on the members allocated to the VLD. The court considered whether the absence of any rule requiring funding of the VLD would amount to the imposition of any "condition, obligation or restriction" on members allocated to the VLD. The court concluded that the primary judge did not make any error in dismissing the application for declaratory relief, and the appeal was dismissed.

The court found that the rules of the Union do not impose oppressive, unreasonable, or unjust conditions, obligations, or restrictions on the members allocated to the VLD. The court held that the absence of any rule requiring funding of the VLD would not amount to the imposition of any "condition, obligation or restriction" on members allocated to the VLD. The court also held that the rules of the Union do not fail to make specific provision for funds to be provided to the VLD to enable the VLD to carry out its prescribed functions under the rules. The court found that the primary judge's decision was not erroneous and dismissed the appeal.

Orders

Orders of the court

1. The appeal is dismissed.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

It is necessary to summarise the relevant facts, the statutory provisions, the Rules and the reasons of the primary judge in order to give context to the parties’ submissions. Factual background The appellant is the Secretary of the VLD. The first respondent is the Branch Secretary of the Victorian Branch of the Union. They are members of the Victorian Branch Executive. The second to twenty-third respondents are, or were at the relevant times, also members of the Victorian Branch Executive. The first to fifteenth and twenty-third respondents made submissions in the appeal, but the remaining respondents filed a submitting notice and did not otherwise participate in the appeal. That division seems to reflect factional divisions within the Victorian Branch. It is nevertheless convenient to refer to the first to fifteenth and twenty-third respondents as “the respondents”. The VLD became part of the Union as a result of an amalgamation between the Australian Federated Union of Locomotive Enginemen (AFULE), the Australian Railways Union, the Australian Tramway and Motor Omnibus Employees’ Association and the National Union of Rail Workers of Australia which took effect on 1 March 1993. The VLD reflected the Victorian branch of the AFULE. In practice, the VLD largely operates as a separate entity within the Union. The VLD provides assistance and representation to the members allocated to the VLD in industrial matters such as enterprise agreement negotiations. The primary judge observed that there is long-standing discord between, on one hand, the VLD and the Victorian Tram and Bus Division, and, on the other hand, the other four Victorian branch divisions. The first to fifteenth respondents are aligned with the latter, while the sixteenth to twenty-second respondents are aligned with the former. In an attempt to stem the division, the Victorian Branch Executive passed a resolution on 8 February 2017 (the 2017 Resolution) to establish a “shared” bank account in the name of the VLD (the Shared Account). Under the 2017 Resolution, all VLD members would pay their subscriptions into the Shared Account; Victorian Branch and VLD officials would jointly authorise transfers from the account; the VLD would transfer funds to the Victorian Branch to pay for shared costs on a monthly basis; and the VLD would transfer all remaining funds to the general account of the VLD each month. The primary judge observed that under the arrangement established by the 2017 Resolution, rather than have the Victorian Branch Executive apportion funds to “shared” expenses and then pay whatever remained to the VLD, membership subscriptions were instead paid into the Shared Account. The Shared Account was partly, if not effectively, controlled by the VLD. Funds for “shared” expenses were paid from the Shared Account to the Victorian Branch Executive only when agreed. The appellant deposed that the 2017 Resolution ensured that both the VLD and the Victorian Branch would receive a sufficient portion of the funds derived from the VLD members’ subscriptions to enable the Victorian Branch and the VLD to meet their respective expenses and to function and carry out their duties under the Rules effectively.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

The respondents submit that there was no error in the judgment of the primary judge. Consideration The appellant’s grounds of appeal allege, in summary, that the primary judge erred by failing to hold that the Rules impose conditions, obligations or restrictions upon members allocated to the VLD that are oppressive, unreasonable or unjust. More specifically, the appellant complains that:(a)the Rules fail to make specific provision for funds to be provided to the VLD to enable the VLD to carry out its prescribed functions under the Rules;(b)the Rules do not contain any requirement that the VLD be provided with a sufficient proportion of membership contributions to enable the VLD to effectively discharge its prescribed duties and functions under the Rules. Section 142(1)(c) of the Act provides, relevantly, that the rules of an organisation:…must not impose on…members, of the organisation, conditions, obligations or restrictions that, having regard to Parliament’s intention in enacting this Act (see section 5) and the objects of this Act and the Fair Work Act, are oppressive, unreasonable or unjust; Where the rules of an organisation contravene s 142(1)(c), the Court retains a discretion whether to make a declaration under s 163(2) or s 164B(3): see R v Spicer; Ex parte Foster (1958) 100 CLR 163 at 168; Cook v Crawford (1982) 43 ALR 83 at 156–158. Section 142(1)(c) requires that regard must be had to the objects of the Fair Work Act. Section 3 of the Fair Work Act refers, inter alia, to recognition of the right to freedom of association and the right to be represented. Section 142(1)(c) also requires that regard must be had to Parliament’s intention in enacting the Act. That intention is stated in s 5(1) and (2) to be to “enhance relations within workplaces” and “reduce the adverse effects of industrial disputation” by specified means, including by requiring organisations to meet the standards set out in the Act. Under s 5(3), those standards include ensuring that organisations are able to operate effectively; encouraging the efficient management of organisations; and providing for the democratic functioning and control of organisations. The expression “having regard to” requires that Parliament’s intention be taken into account, considered and given due weight: see R v Hunt; Ex parte Sean Investments Pty Ltd (1979) 25 ALR 497 at 504, 508; Municipal Officers’ Association of Australia v Lancaster (1981) 37 ALR 559 at 578–579. The first question is whether the absence of any rule requiring funding of the VLD would amount to the imposition of any “condition, obligation or restriction” on members allocated to the VLD. The appellant identifies the “condition” imposed by the Rules on such members as that their industrial representation is to be provided by the VLD but is to be provided without any allocation of funding. The asserted “obligation” is that the members’ elected representatives are to provide representation and administration of the VLD, but without any allocation of any funding. The asserted “restriction” is that the members are deprived of any source of revenue for the VLD to provide its representational functions. As was the case before the primary judge, the respondents do not dispute that the Rules may impose a relevant condition, obligation or restriction. Like the primary judge, we will proceed on the basis of the respondents’ apparent concession.