Lewis, B.L. v Maynes, J.P
[1988] FCA 493
•22 Jul 1988
JUDGMENT No. 4-.?.3Y, ... gs-
IN THE FEDERXL COURT OF XUSTRALIA )
)
VICTORIA DISTRICT REGISTRY ) V No. 31 of 1335 ) INDUSTRIAL DIVISION 1 Appllcants
and
J.F. MAYNES, J.D. SMITH, T.W. SULLIVAX
R.J. WASSON, M. BOURKE. V. HIGGINS, J . D . SMITH,
R. D. CL-ARKE. M. STPANGWOOD, J. D. SWORDS, H. J . D S R O C H ,
D . J . FRY AND L.T. HiiUFF
First Respondents
- and -
Second Respondents
- and -
COMMONWFALTH SAVINGS BdNK DF AUSTRALIA
Third Respondents
A . That until the hearing and determinatlon of this rule to show cause, or untll further urder, the respondenta J.F. Maynes, J . D . Smith, T.W. Sullivan, R.J. Nasson, M. Bourke, V. Higglns, J . D . Smith, R.D. Clarke, M.
Strangwood, J.D. Swords, H . J . Darroch, D . J . Fry and L.T. COURT: NORTHROF J . DATE: zz JULY 1988
FLACE: MELBOURNE - ,
FEDERAL COURT 0; ' !
MINUTES OF ORDE17 AUSTRALIA
PRINCIPAL ' . / REQISTRY
THE COURT ORDERS AND DIRECTS:
._ -
Hauff and each of them:-
1. Perform and observe the rules of the Federated Clerks Union of Australia ("the organlzatlon") by treating as null and void and of no effect the resolutions of the National Executive Committee passed at a meetmg hsld between 23 and 2 3 June 1986 belng the resolutions:-
(a) Directing the Vlctorlan Branch ("the Branch") under rule 15 of t'rre rules of the Organizatlon to forward a sum from the entrance fees, contrlbutions, flnes and levles recelved by the Branch on behalf of the Organizatlon an amount of money which would Provide the
flnance to enable the National Office to:- (1) restore service to members of the
Victorlan Branch;
(ii) preserve the organlsing force intact; and
(iii) ensure that the decisions of the National Executlve in relation to both reinstatement and also conditions of servlce are implemented;
and instructing the Victorian Branch to provide an
initial sum of $250,000 to the Organization.
(b) Instructing the members of the Branch Council including members of the State Executive of the Victorian Eranch of the Organlzatlon that no monles of the Union residing in the aranch
be loaned, advanced or used to apport any loan or advance to any body of members, any Individual, institution, organlzation or branch of an organlzation and directing that
name of the account2 In any bank or such monles are not to be transferred or the organization acceptlng depsslt funds be
changed in any way wlthout the sxpr~sssd
approval of the National Executive.(c) Instructlng the Executive and Council of the Branch as follows:-
(a) not to cease paying the organlzcrs
employed by the Branch up to the declaration of the ballot;
- - - (b) not to employ any additional staff either
by way of replacement or an addition to the complement of organizers;
(c) not to increase the current salaries or
conditions applying to the respective officers, officlals and staff, other than the appllcation of any amount which may flow from the National Wage Case currently before the Commission;
(d) not to pay any salary or allowances to Executlrre members or branch Councillors, except in the case of the person who contested the position of Secretary and the two persons who contested the positions of First and Second Assistant Secretaries, at salary levels prevalllng at the tire of the election.
( d ) Directing the officers and members of the Branch to do all things necessary to ensure immedlate and continuing compliance wlth the following dlrectlon of the national Executive
made under its general powers and under rule 15 of the rules of khe Organ1zatlon:-
ia) all monies, term deposlts, commerclal bills, loans and:or the proceeds of realization thercof held by any Bank, Cs-Ossratlve or Financlal Institution in the name of, or for t o t - on behalf of, the Organlzation in respect of the Eranch or lodged by or opsrated u p m the slgnaturss
of the officers of the Branch are from the date of receipt of a copy of this dirzction at the registered office of the branch to be held for the Organization and on request of the National Secretary
shall be forwarded transferred to
delivered to the National Secretary of the Organization who shall take custody of the same on behalf of the Organization and in the case of monies credit same to a bank account to be opened by the
Organization in the name of "Federated Clerks Union of Australia Victorian Branch Operations Account" which account shall be operated only on the signature of the National Secretary (failing him the National Assistant Secretary) together xith the signatucs of the National President ifailing hir the Deputy National President) or one other National Fxecuti-;e member resident In Melbourne or Sydney and shall be applied excluslvely to maintam the Organization's servlces to members attached to the Branch in such manner as the National Executive or National Council shall from 'clme to tlme direct; (b) a11 entrance fees, contributions, fines and levies received by the Organization
from aembers who are or wlll be attached to the Branch of the Organizatlon except for such amount not exceeding $25,000.00 a5 may be authorized by the National Secretary to be retained as an imprest account for day to day operating expenses
of the Branch shall henczforward and wlth
mmedlate effect be pald credited or transferred to the Federated Ulrrks Unlan of Australia Vrctoria Branch Operations Account;
(c) all Banks, Co-operatives or Financial Inatltutlons actlng on this authority and direction shall be and hereby are mdemnlfled by the Organization agamst any claim or action arising from such
compliance;
(d) this directlon shall contmue in force
until cancelled or varled by further or
other resolution of National Executive or
National Councll.
.l
Be restrained from making requests of or giving dlrectlons to organisers formerly employed within the Victorlan Branch ( "The Branch" in relatlon to:-
representation or servicing of members of the Organizatlon attached to the Victorlan Branch of the Organlzation;
the retentlon by the former organizers of motor vehicles in relation to whlch the Branch has pouers of management and control; and.
the occupancy by the farmer organizers of premlses at 7th floor, 53 Queen Street, Melbourne, belng premises m relatlon to which cantrol. thr Branch has powers of management and
3 . Perform and observe the Rules of the Organlzation by treating as null and void and of no effect the resolutlons of the National Exrcutive made on or about the 4th July 1988 confirming, endorslng or ratifglnq the resolutions of the National Executive Committee passed at a meeting held between the 28th
June and 30th June 1988 described in order (1) hereof.
4 . Perform and observe the rules of the Organization by treating as null and void the resolution of the National Executive made on or about the 4th July 1388 endorslng the National Fresident's rullng re the organizers n o t handing over the keys to the Union vehicles until proper dlscusslons have been held.
”
- 5 -
A . .
B. The Directions hearing be ad~ourned to 1 August 1988 at 10.15am. Note: Settlement and entry of orders 1 s dealt with in Order 36 of the Fcderal Court Rules.
..
IN THE FEDERAL COURT OF AUSTRALIA )
)
VICTORIA DISTRICT REGISTRY ) V No. 34 of 1388 1
INDUSTRIAL DIVISION 1 Applicants
and
Respondents
COURT: NURTHROP J.
m: 22 JULY 1388 PLACE : MELBOURNE
MINUTES OF ORDER
THE COURT OP.DE7.S AiiD DIRECTS: A . That untll the hearlng and daterminatlon of this rule to show cause, or untll further order, the rsspondents and each of them perform and observe the rules of the Federated Clerks Unlon of Australla ("The Organlzatlon") by treating as null and vold and of no effect the
resolutions of the National Executi-;e passed at a
meeting held on or about 19 July 1383 being that:-
1. The officers and members of the Victorian Branch of
the Union he and are hereby dlrected to do all things necessary to ensure immediate and continuing compliance with the following direction of the
National Executive: - (a) All monies held in Federated Clerks Union of Australla (Victorian Branch)
. 2.
. >
Accounts Numbered
030-243, 301-231 and090-310 at the Commonwealth Bank of Australla or any other account current or opened after the date hereof with any bank in the name of or for or on behalf of the Federated Clerks Unlon of Australia in respect of the Victorlan Branch of the Union or any account oprratzd upan the signatures of the offlcers of the Victorian Branch, being monles which have since 29th Aprll, 1385 been recelved by vay of entrance
fees, contributions, fines and levies from members attached to the Victorian Branch, (less so much of these monles as has been applied to the maintenance of the Victorian Branch), are to be forwarded to the National Executive by the 27th July, 1388;
(b) The proceeds upon maturity of every investment or deposlt by way of term deposit, commerclal
bill, loans or the like in, at or with any bank or co-operative or financial institution in the name of, or for or on behalf of, the Federated Clerks Union of Australia In respect of the Victorlan Branch of the Union or lodged by or under the authorltjr of the officers of
the Victorian Branch, to the extent that such
investments have been made vith monles vhlch have since 29th April, 1385 been rece1:;ed by ;Tay uf sntrance fees, contributions, fines
and levies from embers attached to the Victorian Branch, wlll be forwarded to the
National Executlve;
(c) A11 monles which are received in every calendar month on and after the date hereof by way of entrance fees, contrlbutions, fines or levies from members who are or wlll be
attached to ths Victorlan Branch shall be
forwarded to the Natlanal Executive not later
than seven ( 7 ) days after the first day of the
succeeding calendar month;
(d) All monies to be forwarded to the National Executive pursuant to paragraphs 1, 2 and/ur 3 of this resolution shall be delivered to the National Secretary of the Union who shall deposit same m a bank account to be opened by
the Unlon in the name of "Federated Clerks Unlon of Australla (Victorian Branch) Operations Accounts" which account shall be operated only on the signature of the National Secretary (failing him the National Assistant Secretary) together wlth the signature of the National President (failing him the Deputy Natlonal Fresldent) or one other Natlonal Executive member resident in Melbourne or Sydnzy and shall be applied exclusively to
mamtain the Union’s services to members
attached to the Victorian Branch in such manner as the National Executive or National
Councll shall from time to time direct;
(e) This direction shall continue in force untll
cancelled or varied by further or other
rssolution of the Natlanal Executive or National Council.
9
L . National Executive re-affirms that it does not accept the validity of the dismissal by the Victorlan Branch of all of its organlslng staff.
National Executive notes that hearings are pending in the Industrial Relations Commission of Victoria rrgardlng applications by the organisers for relnstatement pursuant to the Industrial Relations Act.
National Executive determines, pending the outcome
of those proceedings, to appoint as organisers thefollowing:
Michael Cashman
John LaunderMark O‘Brien Geoff Taylor Anthony O’Brien
Anthony Medlicott
Denls Parker
Linda Salarneh Wally Lefleur Gaylene Lambert
Mary-Jo RenehanBruce Crockell
The organisers appolnted will perform work as dlrzcted by the National Secretary.
B. The dlrectlans hearlng be adjourned to 1 August 1988 at 10.15am.
Note: Settlement and entry of orders is dealt with in Order
36 of the Federal Court Rules.
' L m t e d Dlstributlon'
IN THE FEDERAL COURT OF AUSTRALIA)
)
VICTORIA DISTRICT REGISTRY ) V. Nos 31 & 3 4 of 1988 )
INDUSTRIAL DIVISION 1 BETWEEN: BARBARA LEE LEWIS AND OTHERS
Applicants
and
J.P. MAYNES AND OTHERS
Respondents
COURT: NORTHROP J. DATE : 2 2 JULY 1988 - PLACE: MELBOURNE - EX-TEMPORE REASONS FOR JUDGNENT
There are two matters presently before the Court. Th re further battles in a war which has broken out between the committee of management of the Victorian Branch of the Federated Clerks Union of Australia, ("the State Executive"), and the commlttee of management of the Federated
Clerks Union of Australia, ("the National Executive") and also the smaller body, the National Executive Committee. The event which gave rise to the outbreak of that war was the declaration of the poll on Friday, 2 4 June 1988 of the result of the elections within the Victorian Branch. At those elections a large number of candidates were contesting a large number of offices to be filled by election. Among the offices to be filled, were the offices of President, Deputy
4 .
President, Senior Vice President, Junior Vice President, Secretary, First Assistant Secretary and Second Assistant Secretary of the Victorian Branch. The holders of those offices constitute the State Executive and committee of management of the Victorian Branch. Other offices to be filled at those elections included the offices of State Councillors and the offices of Natlonal Councillors, including Alternate National Councillors.
As a result of the election, the applicants were elected to the offices of the State Executive.
Since the
declaration of the poll, there has occurred a series of
events which can, on all the evidence, be described as
attempts by the majority of the members of the National
Executive to frustrate the activities of the State Executive
in its attempts to exercise the powers and perform the duties
conferred and imposed upon it by the Victorlan Branch Rules.
In other words, the National Executive is attempting to take
control of and to manage the affairs of the Victorian Branch.
In the matters immediately before the Court, the members ofState Executive, as applicants, are seeking interlocutory
orders which are designed to prevent the National Executive and the National Executive Committee from, in effect, taking control of the management of the Victorian Branch. The
members of the National Executive claim that under the rules
of the Union, which I shall describe as the National Rules,
and the rules of the Victorian Branch, which I shall describe
as the Branch Rules they are qurte entitled to do what they
have done and are seeking to do. The applicants contend that
I
the National Rules and the Branch Rules, on their proper construction, do not empower the National Executive to do what they have done and intend to do. They contend further that if the rules do empower them to do that, the rules contravene sub-section 140(1) of the Conciliation and Arbitration Act 1904 ("the Act") and so cannot be relied upon by the National Executive. They contend further, that if they fail in these two contentions, or either of them, on the evidence the powers relied upon by the National Executive members have not been exercised by them, bona fide for the purpose of the power. On any of these grounds, the applicants are seeking interlocutory orders to prevent the National Executive, until the hearing and determination of these matters or until further order, from acting on the
resolutions they have passed to give effect to their
intention to, in substance, manage the Victorian Branch. It should be noted that in each of these matters the respondents in matter V34 of 1984, with e exception of
Mr Swords and Mr Clarke, and the first respondents in matter
31 of 1988, with the exception of Mr Swords and Mr Clarke,
are opposing the making of the interlocutory orders sought. It should be noted also that interlocutory orders are being sought. The matters raised by these proceedings are extremely complex and difficult to resolve. Although the hearing has extended over three days the claims are for interlocutory relief. The Court 1s in no position to form any final view on the facts or on the law. As is usual in interlocutory applications of thls type, of necessity, tentative views only have been formed, whlch on further analysis, may prove to be unfounded. Events have been happening at great speed and it is important that if rellef is to be given, the lnterlocutory orders should be made as speedily as possible to enable the Branch to be managed by the State Executive for the benefit of the members of the Union attached to the Victorian Branch. Implicit in this is, that if after interlocutory orders have been made, events occur which indicate any party is engaging in action which could constitute conduct inimical to the Interests of the Union or the interests of members of the Union attached to the Branch, further interlocutory orders can be made to rectify the positlon. Implicit also is the fact that a broad perspective must be taken of the matters presently before the
Court without the Court having to go into a great degree of detail for the purposes of deciding whether interlocutory relief should be granted or not.
As was said earller, since the declaration of the
poll on 24 June there have been a large number of proceedings
commenced in this Court relating to the electlon and events which have occurred subsequently to the declaration. Three election inquirles have been instituted under Part IX of the Act, namely V28 of 1988, V30 of 1988 and V33 of 1988. Each
of those inquiries relate to the whole of the elections. The applications for the inquiries were lodged with the Industrial Registrar on 27 June 1988, 7 July 1988 and 18 July 1988 respectively and were instituted in the Court on 30 June
1988, 8 July 1988 and 19 July 1988 respectively. Those three
inquiries are proceeding together and are listed for directions on Monday 1 August 1988. The Court has been informed that interim orders will be sought in one of those inquiries to the effect that the persons who held office as members of the State Executive immediately prior to the
declaration of the poll on 2 4 June, should be reinstated in those offices until the hearing and determination of the election inquiries. If interim orders of that kind are made, they would affect any interlocutory orders made in the
matters presently before the Court, although, to be more
accurate, if interim orders of that kind are made in the election inquiry, there would, It appears, be no need for the National Executive to attempt to exercise the powers it is now relying upon to support its actions.
Of more importance, however, implicit in the fact that no interim orders have been made in the election
inquiries, is the fact that in the matters presently before
the Court, the Court must proceed on the basis that the
elections within the Victorian Branch are valid and that the
persons declared by the returning officer to hold those offices as set out in the declaration of the poll, in law
hold those offices at the present time.
Natter V No. 31 of 1988 is the third rule to show
cause, arising after the declaration of the poll and relates
to events arising therefrom. In V No. 27 of 1988, the Court
as presently constituted, on 30 June 1988 discharged a rule to show cause why M r Maynes should not sign a document to enable the State Executive to operate bank accounts in the name of the Victorian Branch with the Commonwealth Savings Bank. The reasons for making that order should be read as
forming part of the material relevant to the present reasons for judgment. In matter V No 21 of 1988 the Court, as presently
constituted, on 4 July 1988 made interlocutory orders to the effect that until the hearing and determination of that matter, or until further order, members of the National Executive treat as null and void a resolution of the National Executive Committee relating to the terminatlon of employment of the organizers employed by the State Executlve. The reasons for making that order should be read as forming p a r t of the material relevant to the present reasons for judgment.
In matter V No. 31 of 1988 the applicants, being members of the Union and who, since 24 June 1988, constitute the State Executive are seeking interlocutory orders under s.141 of the Act directing the first group of respondents,
each of whom is a member of the Union and who together constitute the National Executive of the Union, to treat as null and void and of no effect specified resolutions passed by the National Executive Committee and approved by the National Executive. It should be noted that three of the respondents, namely Mr Maynes, Mr Sullivan and MC Darroch, were unsuccessful candidates for offices at the elections, and that those three persons together with the respondent Mr Wasson, constituted the National Executive Committee which passed initially some of the challenged resolutions. Others
were passed in the absence of Mr Wasson, namely, those passed on 27 June 1988. All resolutions passed by the National Executive Committee were subsequently approved by a majority of the members of the National Executive on a postal ballot. It should be noted further that interlocutory orders are sought against the commonwealth Savings Bank in relation to accounts kept at that bank in the name of the Victorian Branch. Those matters, with one exception, have been resolved, and those interlocutory orders are not now being sought. There remains, however, a question as to what is to
be done with respect to the sum of about $830,000 presently being held at the direction of the Court in an account with
the Commonwealth Bank. This matter will require further
consideration at a later time.
In addition, a fourth rule to show cause was
granted yesterday and made returnable this morning, that
being matter V No. 3 4 of 1988. Under that rule the applicants are seeking interlocutory orders also with respect
on 19 July which, in substance, replace and refine the to resolutions passed and adopted by the National Executive earlier resolutions. In the refining process greater care was taken to ensure the use of words to attempt to brlng them within the requirements of rule 7 and rule 15 of the National Rules. A further resolution relates to the engagement of
organizers which will be dealt with in more detail later in these reasons. These resolutions are directed to what was described early in these reasons as the attempt by a malority of the members of the National Executive to take control of and to manage the affairs of the Victorian Branch even though
submissions have been made on behalf of the respondents
appearing before the Court that they are drrected only to the control of the funds, described as the federal fund, of the union, which is on the proper construction of the National Rules, so ~t was argued, solely within the control of the National Executive.
The orders sought in V No. 31 of 1988 are contained
in a form of rule to show cause handed to the Court yesterday, namely 21 July 1988. The orders contained in that document vary in some minor form to those contained in the original rule to show cause, and do contain other orders whlch were not contained in the earlier document. Some of those addltional orders are not belng pressed, but insofar as the matters which are being pressed are concerned, leave is given to the applicants to amend the rule nisi in accordance with the document handed to the Court on 21 July 1988, and
reference will be made to that document when referring to the form of the orders whlch are being sought. The orders sought in the rule to show cause as are follows:
Order A.l
A directlon that the First Respondents and each of them perform and observe the rules of the
Federated Clerks Unlon of Australia ("the Organization") by treating as null and void and of no effect the resolutlons of the National Executive Committee of the Organization passed at a meeting held between the 28th and 30th June
1988:-
(a)
Directing the Victorian Branch ("the Branch") under rule 15 of the rules of the Organization to forward a sum from the entrance fees, contributlons, fines and levies received by the Branch on behalf of the Organization an amount of money which would provide the finance to enable the National Office to:-
(i) restore service to members of the Victorian Branch;
(ii) preserve the organising force intact; and
(iii)ensure that the decisions of the National Executive in relation to both reinstatement and also conditions of service are implemented;
and instructing the Victorian Branch to provide an
initial sum of $250,000 to the Organization.
Order A.2
A direction that the First Respondents and each of them perform and observe the rules of the Organization by treating as null and void and of no effect the resolution of the National Executive Committee of the Organization passed at a meeting held between the 28th and 30th June 1988:-
(b) Instructing the members of the Branch Council including members of the State Executive of the Victorian Branch of the Organization that no monies of the Union residing in the Branch be loaned, advanced or used to support any loan or advance to any body of members, any individual, institutlon, organization or branch of an organization and directing that such monies are not to be transferred or the
name of the accounts in any bank or organization accepting deposit funds be
changed in any way without the expressed
approval of the National Executive.
This order is still a very live issue.
Order A.3
A direction that the first respondents and each of them perform and observe the rules of the Organization by treating as null and void and of no effect the resolution of the National Executive Committee of the Organization passed at a meeting held between the 28th and 30th June 1988:-
(c)
Instructing the Executive and Council of the Branch as follows:-
not to cease paying the organizers
employed by the Branch up to the declaration of the ballot;
not to employ any additlonal staff either by way of replacement or an addition to the complement of organizers;
not to increase the current salaries o r
conditions applying to the respective officers, officials and staff, other than the application of any amount which may flow from the National Wage Case currently before the Commission;
not to pay any salary or allowances to Executive members o r branch Councillors, except in the case of the person who contested the position of Secretary and
the two persons who contested the positions of First and Second Assistant Secretaries, at salary levels prevailing
at the tlme of the election".
That resolution, presently, is not being supported by the first respondents and, really, no problems arise with respect to this order as sought.
Order A.4
A direction that the First Respondents and each of them perform and observe the rules of the organization by treating as null and void and of no effect the resolution of the National Executive Committee passed
at a meeting held between the 28th and 30th June 1988:-
(d) Directing the officers and members of the Branch to
do all things necessary to ensure immediate and continuing compllance with the following direction of the Natlonal Executive made under its general powers and under rule 1 5 of the rules of the 0rganization:-
(a) all monies, term deposits, commercial bills,
loans and/or the proceeds of realization thereof held by any Bank, Co-operative or Financial Institution in the name of, or for or on behalf of, the Organization in respect of the Branch or lodged by or operated upon the signatures of the officers of the Branch are from the date of receipt of a copy of this
direction at the registered office of the
. - l1 - branch to be held for the Organization and on request of the National Secretary shall be
forwarded transferred to delivered to the National Secretary of the Organization who shall take custody of the same on behalf of the Organization and in the case of monies credit
same to a bank account to be opened by the Organization in the name of "Federated Clerks Union of Australia Victorian Branch Operations Account" which account shall be operated only on the signature of the National Secretary (failing him the National Assistant Secretary) together with the signature of the National President (failing him the Deputy National President) or one other National Executive
member resident in Melbourne or Sydney and shall be applied exclusively to maintain the
Organization's services to members attached to
the Branch in such manner as the National
Executive or National Council shall from timeto time direct;
(b) all entrance fees, contributions, fines and
levies received by the Organization from members who are or will be attached to the
Branch of the Organization except for such
amount not exceeding $25,000.00 as may be
authorized by the National Secretary to be
retained as an imprest account for day to day
operating expenses of the Branch shall
henceforward and with immediate effect be paid
credited or transferred to the Federated Clerks
Union of Australia Victoria Branch OperationsAccount;
(c) all Banks, Co-operatives or Financial Institutions acting on this authority and direction shall be and hereby are indemnified by the Organization against any claim or action arising from such compliance;
(d) this direction shall continue in force until
cancelled or varied by further or other resolution of National Executive or National
Council".
TO a large extent these resolutions have been overtaken by
the first resolution passed on 19 July 1988 and to that extent no great time is needed to consider this order but whether interlocutory orders should be made in thls form in
so far as the later resolution concerned, is certainly a
matter of dispute between the parties.
Order A.5
"A direction that the first respondents and each of
them perform and observe the rules of the organization by treating as null and void and of no effect, the resolutions of the National Executive made on o r about 4 July 1988 confirming, endorsing or ratrfying the resolutions of the National Executive Committee passed at a meeting held between 28th June and 30th June 1988
described in paragraphs A1 to A4 inclusive".
This order is directed to the procedural provision whereby the National Executive approved the earlier resolutions made by the National Executive Commlttee and in itself this rule does not raise any different issues to those which are raised by the orders A1 to A4.
Order A.6
"A direction that the First Respondents and each of them perform and observe the Rules of the Organization by treating as null and void and of no effect the resolution of the National Executive made on o r about the 4th July 1988 endorsing the National President's ruling re the organizers not handing over the keys to the Union vehicles until proper discussions had been held".
This order is being contested.
Order A.7
"An order restrainlng the first respondents and each of them from making requests of o r giving directions to
organlzers formerly employed within the Branch in relation to:
I. Representations or serviclng of members of the Organization attached to the Branch. 11. The retention by former organizers of the motor
vehlcles in relation to which the Branch has powers of management and control.
111. The occupancy by the former organizers of the
premises at 7th floor, 5 3 Queen Street, Melbourne, being premises in relation to which the Branch has
powers of management and control."By way of interlocutory relief the applicants are
seeking orders directing the first respondents and each of them to perform and observe the rules of the organization by
treating as null and void and of no effect the resolutions of the National Executive Committee passed at a meeting held between 28 and 3 0 June 1988 and referred to in orders A . l to A.4 as set out above. In addition they are seeking an interlocutory order
restraining the first respondents and each of them from making requests of or giving directions to organizers formerly employed wlthin the Vlctorian Branch in relation t0:-
"(a) representation or servicing of members of the Organization attached to the Victorian Branch of the Organization;
(b) the retention by the former organizers of motor
vehicles in relation to which the Branch has powers of management and control; and
(c)
the occupancy by the former organizers of premises at 7th floor, 53 Queen Street, Melbourne, being premises in relation to which the Branch has powers of management and control".
In addition the applicants are seeking interlocutory orders directing the first respondents to
perform and observe the rules of the Organization by
treating as null and vold the resolutions of the National Executive endorsing, confirming or ratifying the resolutions
of the National Executive Committee lust referred to and the resolutlon endorsing the National President's ruling re the organlzers not handing over the keys of the union or of the union vehicles until proper discussions have been held. They are in a slmilar form to other orders set out earlier in these reasons.
A further interlocutory order 1s belng sought in the following form which was formulated yesterday, namely:
"That pending the completion of the proceedings herein, or further order, the respondents J.P. Maynes
and T.W. Sullivan being two of the first respondents herein be restrained from operating bank accounts of the Federated Clerks Union of Australia, (Victorlan Branch) except in the circumstances described in sub-rule 15(6) of the rules of the organization."
in the name
V No 3 4 of 1988 is in a simllar form but it sets
out the long resolution passed by the Natlonal Executive on
19 July 1988. Thls resolution has been referred to earlier
in these reasons and is as follows:
"A dlrection that the Respondents and each of them
perform and observe the rules of the Federated Clerks union of Australia ("the Organization") by treating as null and vold and of no effect the resolution of the National Executive passed on or about the 19th July, 1988 as follows:-
1. That the officers and members of the Victorian Branch of the Union be and are hereby directed to do all things necessary to ensure immediate and
of the National Executive:- continuing compliance with the following direction
(a) All monies held in Federated Clerks Union of Australia (Victorian Branch) Accounts Numbered 090-249, 901-291 and 090-310 at the Commonwealth Bank of Australia or any other
account current or opened after the date hereof with any bank in the name of or for or on
behalf of the Federated Clerks Union of Australia in respect of the Victorian Branch of the Union or any account operated upon the signatures of the officers of the Victorian Branch, being monies which have since 29th April, 1985 been received by way of entrance fees, contributions, fines and levies from members attached to the Victorian Branch, (less
. - 15 - so much of these monies as has been applied to the maintenance of the Victorian Branch), are to be forwarded to the National Executive by the 27th July, 1988;
The proceeds upon maturity of every investment or deposit by way of term deposit, commercial
bill, loans o r the like in, at or with any bank, or co-operative o r financial institution In the name of, or for or on behalf of, the Federated Clerks Union of Australia in respect
of the Victorian Branch of the Union or lodged
by or under the authority of the officers of
the Victorian Branch, to the extent that such
investments have been made with monies which
have since 29th April, 1985 been received by
way of entrance fees, contributions, fines and
levies from members attached to the Victorian
Branch, will be forwarded to the National
Executive;All monies which are recelved in every calendar month on and after the date hereof by way of entrance fees, contributions, fines or levies from members who are o r will be attached to the Victorian Branch shall be forwarded to the National Executive not later than seven ( 7 ) days after the first day of the succeeding calendar month;
All monies to be forwarded to the National Executive pursuant to paragraphs 1, 2 and/or 3 of this resolution shall be delivered to the National Secretary of the Union who shall
deposit same in a bank account to be opened by the Union in the name of "Federated Clerks
Union of Australia (Victorian Branch)
Operations Accounts" which account shall be operated only on the signature of the National
Secretary (failing him the National Assistant Secretary) together with the signature of the National President) o r one other National National President (failing him the Deputy
Executive
member
resident
in
Melbourne or
Sydney and shall be applied excluslvely to
maintain the Union's services to members attached to the Victorian Branch in such manner
a s the National Executive or National Councll
shall from time to time direct;thls direction shall continue in force until cancelled or varied by further or other resolution of the National Executive or National Council".
As was said earlier, the form of this resolution is in reality, designed to overtake and replace
a number of the
earlier resolutions. It is in a refined form and has been drafted on the basis of making it clear that it comes within the wording of the National Rules. Paragraph (e) of this resolution has aspects of an interlocutory order.
The second resolution, the subject of the rule to show cause in V34 of 1988, is as follows:
"National Executive re-affirms that it does not accept the validity of the dismissal by the Victorian Br ch of all of its organising staff.
National Executive notes that hearings are pending in the Industrial Relations Commission of Victoria
regarding applications the organisers by for reinstatement pursuant to the Industrial Relations Act.
National Executive determines, pending the outcome of
those proceedings, to appoint as organisers the following: Michael Cashman
John Launder
Hark O'Brien
Geoff Taylor
Anthony O'Brien
Anthony Medlicott
Denis Parker
Linda Salameh
Wally Lefleur
Gaylene LambertNary-Jo Renehan
Bruce Crockell
The organisers appointed will perform work as directed by the National Secretary".
The applicants are seekmg interlocutory relief in
the form that the respondents and each of them perform and
observe the rules of the Federated Clerks Union of Australia by treating as null and void and of no effect the resolutions of the National Executive passed on or about 19 July 1988 as
set out.
There is no doubt that the National Executive
Commlttee and the National Executlve passed the resolutions
which are the subject of the interlocutory orders sought.
The Union is an organization under the Act. Pursuant to the
National Rules the Union has created branches and the
existence of those branches must be accepted. Those branches
are in existence and are operating as branches under theNational Rules and the branches have power conferred upon
them by the National Rules to make rules for their own management. It is clear that in law there is only one legal identity involved here, namely the Union itself. It is a corporate body and as a result any property vested in the Union must vest in that corporate body.
The rules, both the Natlonal Rules and the Branch
Rules, provide methods f o r controlling the activities of the
Union and of the Branch and it is to those rules that reference must be made to determine where sources of power
reslde to do various things. The National Rules contain provisions for the creation of branches and enable branches
to make rules for their
own management.
This has been done.
Under the National Rules, one must accept that in one sense the National Rules are paramount in that they are the source of power for the making of the Branch Rules but at the same time it must be recognized that under the National Rules the
Branch Rules do exist, do have effect and a factual situation arises which must be recognized. It is equally clear that any organization under the Act does not, of necessity, have
to have branches but where branches have been created the
Act, and the Regulatlons made under the Act, apply to those
branches in the same way as the Act and the Regulatlons apply to the organization itself, particularly when it comes to the question of rules and what they must contain.
It is in this context that reference must be made
to a number of the National Rules and the Victorian Branch Rules. In the Victorian Rules, the word "Union", apart from
one rule which is not relevant for present purposes, is defined to mean the Branch. This can give rise to confusion
but it must be remembered that where the word "Union" is used in the Branch Rules, unless a contrary intention appears, it is referring to the Victorian Branch. Rule 19 of
the Branch rules constitutes the State Councll, which
comprises persons elected to offices under the provisions of the Branch Rules and the powers and duties of State Council
are set out in rule 20. It will be remembered that at the recent elections State Councillors were elected to State Council and State Councll consists of the President, Deputy
President, Senior
Vice-President,
Junior-Vice
President,
Secretary, First Assistant Secretary, Second Assistant Secretary, who constitute he State Executive, and councillors elected as provided in the rules some by voting of members of sections and some by votlng of the whole of the membershlp of the Branch. It meets quarterly and has power to give directions to the State Executive.
Rule 21 constitutes the State Executive which is also the committee of management of the Branch. Rule 22 sets out the powers and duties of the State Executive and I read the opening words of paragraph (a):
"(a)
The State Executive shall, subject to the review of its actions by the State Council, have the care, control, custody, superintendence, management and administration in all respects of the affairs,
business, funds and property of the Union and without
limiting the generality of the foregoing :-"
There is then set out a large number of specific powers including the following:
" 1 . It may engage and dismiss all paid servants of the Union other than the Auditor and pay such salaries and allowances as it may deem proper. 3 . It shall be responsible for organislng the Union and may establish Sections, Sub-Sections, District Councils and Local Committees and may disband, amalgamate or reorganise such Sections, Sub-Sections, District Councils or Local Committees.
6. It shall be responsible for all expenditure of
the Union and may incur all necessary expenditure for the proper upkeep and the furtherance of the objects of the Union and it
may pay all sums so incurred."
It will be noted that that power makes reference to the
expenditure of property for the furtherance of the objects of the Union which are contained in rule 3 . They cover a very wide range of objects.
" 8 . It may demand, sue for, recover and keep possession of all books, accounts and other
property of the Union".
I
Rule 22(b) is as follows:
"(b) All acts and decisions of the State Executive shall have full force and effect and have full validity, notwithstanding anything otherwise provided In these Rules, until such acts or decisions are reversed or altered or otherwise dealt with by the State Council."
There is then set out a proviso which I need not read. Rule 25 sets out the powers and duties of the State Secretary and I make special reference to a number of those powers :
He shall receive and bank all moneys collected
by and on behalf of the Union. He shall
receive and Investigate for report o the State Executive all complalnts from members.
He shall deal with correspondence and present, when required, a t rue account up to date of receipts and expenditure of the Union to the State Executive of the Union.
He shall be responslble for the proper car ying on of the Union, and shall act as general supervisor for and on behalf of the Union.
He shall counterslgn all money orders, vouchers and cheques for and on behalf of the Union, and he shall not make any payment exceedlng Forty Dollars He shall personally, or by an authorised ( $ 4 0 ) except by cheque.
officer, collect all
Union dues, fines, or
levies from members or Sections.
Sublect to the direction and control of the State Executive he shall have charge of all organising undertaken on behalf of the Union,
and shall direct he operations of any organiser who may be appointed."
There is also rule 3 3 , which was referred to in the earlier reasons for judgment given in matters involving these events, and which provides for the application of funds and, in particular, rule 33(b):
"(b) All orders for the withdrawal of moneys from the bank shall be signed by the President or Deputy Vice-President or Senior Vice-President
or Junlor Vice-President together wlth the State Secretary or First Assistant State
Secretary."
It will be apparent from a reading of these rules that they appear to comply with the provisions of the Act dealing with the control of committees of management by the
members of the Branch and in this regard the control arises from the elections themselves. It 1s clear that these rules give the management of the affairs of the Branch to the State
Executive which is elected by the members of the Union
attached to the Victorian Branch. Above the State Executive is the larger
body, the State Council, which likewise is elected by the members of the Union attached to the Victorian
Branch. The pattern of the rules 1s conslstent with the Act and the Regulations and in this regard reference may be made
to the chief objects of the Act and in particular object (f) as contained in s.2 of the Act:
"TO encourage the democratic control of organizations so registered and the full participation by mem ers of such an organisation in the affalrs of the organizatlon."
That object is given effect to by a number of the provisions
of the Act itself and in this regard sub-section 132(2) is of
importance. That sub-section requires that the conditions to be complied with by organizations shall be as prescribed and
in this regard reference can be made to Regulation 115(l)(d) of the regulations, namely:
"The following conditions are prescribed conditions to be complied with by
an
association applying
for
registration, namely:- .....
(d)
the affairs of the association shall be regulated by rules specifying the industry in or in connexion with which the association is formed, the purposes for which it is formed and the conditions of eligibility for membership thereof and providing, in relatlon to the association, for-
(i) the election of -
(a)
a committee of management of the association and of each branch of the association;
(b) officers of the association and of each of the association; and
branch
(c) any conference, council, panel or other body (additional to the committee of management), which is empowered to determine policy or to
exercise functions of management in the association or branch;
(ii) the powers and duties of the committess and of officers;
(ii the manner of summoning meetings of members and
of the committees;( iv the removal of members of the committees and of
officers;
( V )
the control of commlttees of the association and its branches by the members of the association and the members of the branches, respectively;"
These requirements apply to orqanlzations, see Reg.
115(2). It is to be noted that these requirements apply not only to an organization itself but also to branches and it
is
in this context that the fact of the existence of branches is of importance in the present case.
I
The Branch Rules provide for the elections to take
place. When those elections have been held, and until they have been declared invalid under
Part IX
of the
Act, it must
be accepted that the persons declared elected take office and
are treated as the officers and members of the controlling
bodies within the Branch of the organization. Those membersmay be capable or incapable, that is beside the point. One
of the effects of a democratic system is that the electorate have the right to elect persons, whether the persons elected
are capable o r incapable. The electorate is required to
accept the result of the election. In the present case the
applicants have all been elected to the offices of State Executive of the Victorian Branch of the Union.
The National Rules of the Union should be referred to as well since it is these rules
which are relied upon by
the respondents to justify what they are doing. In these rules the word "Union" IS used to describe the organization itself and not the Branch. Rule 5 deals with candidates for membership and how membership is to take place and for
practical purposes it appears that each member of the Union must be attached to a Branch of the Union and there can be no membership except through a Branch. Rule 7 is of importance.
It makes provision for entrance fees and contributions.
Under rule 7 those amounts are to be paid to the organlzations and sub-rule ( 5 ) provides:
"All entrance fees, contributions, fines and levies shall be payable to the Union and shall form part of the
federal fund of the Union. . . . . . ' l
I need not read the rest of that rule but reliance was placed very much on the use of the word "federal fund". In the
present case it is noted that the applicants do not rely upon the provislon of section 133A of the Act nor upon sub-section 140(l)(d) of the Act.
There is no provision in the rules for what might be described as branch funds but
in the context of the
orders
being sought that does not really matter because the whole of these proceedings are being considered on the basis that all
property of the union IS vested In the Unlon. What I am
concerned with is who has power to do what with respect tothat property.
Sub-rule 7 ( 7 ) also is of importance and I read
paragraph (a);
"(a) The National Executive may prescribe particular
Banks, Credit Societies or, f o r the purposes of
sub-rule 37(2), other Financial Institutions and
specific accounts thereat into which moneys
collected pursuant to sub-rule 7 ( 5 ) shall be paid and the National Secretary and National President
accounts prescribed hereunder. In addltion to the shall register themselves as signatories to any National Secretary and Natlonal President, the
signatories to such accounts shall be persons authorised by the Branches in respect to whlch the accounts are establlshed. Any two of the National Secretary, National President or such authorised persons may sign cheques drawn on the accounts." (emphasis added).
Rule 15 relates to branch payments. Sub-rule (1)
reads:
.
"(l) The National Executive may direct a Branch to forward to it all or any part of the entrance fees, contributions, flnes and levies received by the Union from members who are or will be attached to such Branch, and every Branch receiving such a direction shall comply with it forthwith or by the
time (if any) specified in the direction for compliance."
I refer to but do not read rule 15(lA). Sub-rule 15(2) deals with the time f o r the payment of the moneys and sub-rule (3)(a) provides:-
"(a) Each Branch shall forward to the National Secretary at the times prescribed by Rule 15(2) an amount (hereinafter called "the sustentation fee") calculated as hereinafter provided."
That sustentation fee basically is a fee which is then used by the National Executive for the affalrs of the Union
itself. Sub-rule 1 5 ( 6 ) provides:- "15(6) If the National Council declares a Branch to be unfinancial pursuant to sub-rule
15(4) and the
moneys owed by the Branch remain unpaid f o u r weeks
after the making of such declaration, the National Executive may direct the Natlonal President and the National Secretary to draw on any account or interest bearing deposit prescribed pursuant to sub-rule 7(7) and operated by, or in the name of, the Branch concerned for the amount owed by the
payable to the National Executive." Branch or to sign a cheque drawn on such account for the said amount. Any cheque so drawn shall be
This rule is to be read, it was contended by the applicants, with sub-rule 7(7) and it was said that these two are connected and that sub-rule 15(6) has a llmited application.
Rule 27 constitutes the National Executive.
. - 26 - "27(1) The National Executive shall consist of the National President, the National Deputy President, the National Secretary, the Assistant National Secretary, and the National Vice-Presidents elected pursuant to Rule 26."
It should be noted that the members of the National
Executive are elected by and form the membershlp of the National Council the members of which are elected on a branch basis by members of the respective Branches.
Sub-rule (3) provides for the general powers of the
National Executive:
"27(3) The National Executive shall, sub~ect to the review of Its actions by the Natlonal Council, have the care, control, custody, superlntendence, management and administration in all respects of the affairs, buslness, funds and property of the Union, and without limiting the generality of the foregoing, it may:- ..."
There are then set out a large number of specific powers and with the possible exception of the power contained in paragraph 27(3)(p) none confers a specific power on the National Executive to do what it is doing and attempting to
do in the future with respect to the Victorian Branch. Paragraph 27(3)(p) is as follows:
"27(3)p Notwithstanding any other provisions of the rules of a Branch, appoint organisers to recruit members in an industry, occupation or locality."
Counsel for the first respondents in V No 31 of
1988 and the respondents in V No 3 4 of 1988 contend that the generality of the power conferred by rule 27(3) is an ample source of power, when read in conformity with the remainder of the rules to justify the action taken by the National Executive. The powers conferred by paragraph 27(3)(b) do not
apply since none of the applicants have been removed from
office under that paragraph.Rule 28 relates to the Natlonal Executive Committee and it allows a smaller body to make decisions which can be reviewed or disallowed by the National Executive. I do not need to read that rule. The National Executive Commlttee has no greater power than that of the National Executive.
Rule 37 relates to the funds and property.
Sub-rule ( 1 ) reads: "37(1) All funds and property held by any Branch shall be
vested in the Union".
Sub-rule ( 2 ) reads:
" 3 7 ( 2 ) The Executive of a Branch shall not invest any funds for the tlme belng in its possession in other than authorised trustee investments without the approval of the Natlonal Council o r National Executive. "
For present purposes they are the rules to which
reference has been made. There are other rules dealing with other types of investments. I need not refer to any of these at the present time.
!
I am satisfied that a serious question has been raised by the applicants on the issue of whether the powers conferred by the Natlonal Rules on the National Executive should be read down. In this regard reference is made to
National Rules 7(5) and (7), 15(6) and 27(3). It is realized that a general power conferred by a rule is not to be limited by the fact that specific powers are then conferred but nevertheless having regard to the whole of the rules and the way in which the Union is operating through branches it seems to me there is an argument - a substantial argument - that can be put that on their proper construction those rules have a limited effect and that they do not entitle the Federal Executive to interfere with the running of a Branch except in the special circumstances of Rule 27(3)(b). Apart from Rule 15(6) there 1s no power to control or manage a branch unless the officers have been removed. The power under Rule 15(6)
is limited.
The power to appoint organizers, under rule
27(3) (p) so it was argued, and there is force in the
argument, is limited to the recruitment of members and does
not extend to the day-to-day management of a branch. I am very conscious of what has been said by Gray J. in Callaghan v The Federated Clerks Union of Australia, an unreported judgment given on 24 December 1907, but on a reading of those reasons it does not appear that arguments put before me had been put to him in the course of that case.
I accept that the National Rules are paramount,
but at the same tlme, having regard to the Act and the
Regulations, particularly Reg. 115(l)(d), and the fact that
there are Branches in operation here, there is an argument
that the National Rules should be read down. In particular
the Victorian Branch members are entitled to elect the State
Executive and it 1 s to be expected that In accordance with
the Branch Rules that Executive should continue to manage the
affairs of the Branch and that those affairs should not be
managed by some other body or committee comprising people who
have not been elected by the members of the Victorian Branch.
The National Executive, in substance, is a body elected by a
much wider electorate than the Victorian Branch members and
it seems that there could well be good arguments that if a
wider construction were given to the Natlonal Rules, namelythat suggested by the respondents, the rules would contravene
paragraphs 140( 1) (a) and (c) of the Act and would contravene Reg. 115(l)(d) of the Regulations. In this regard it is worthwhile referring to what was said by Kirby J. and myself in Nucifora v Mapstone unreported, 4 November 1983, and
referred to in the reasons for judgment given in V21 of 1988. At page 24 of that judgment we sald, and I quote:
committee to overrule almost any decision of a branch “A rule of an organlzation which enabled a federal committee could contravene sub-section 140(1) of the Act;
see Allen v Townsend (1977) 31 F.L.R. 431 per Smithers J. at pp.458-9 and Evatt and Northrop JJ. at p.471. In the present case, the acceptance of the contentions by the appellants could lead to that result. The ultimate power in any organization or branch must reside eventually in the members of the organization or of the branch respectively.
If the National Rules are not to be read down it
may well be that there is also a serlous questzon to be tried, and I so hold, as to whether those rules contravene sub-section 140(1) of the Act and thus cannot be relied upon to support the actlons of the Natlonal Executive.
I am very conscious that the property of the
organization, including moneys, cars and leases, are all owned by the organization itself. However, I am concerned, as I said before, with the question of powers of management. The fact of the ownership itself to my mind 1s not of crucial
importance. What is of importance is who has the power of management, including the disposal of moneys. This depends upon the true construction of the rules. And on the application of those rules a question then must be decided whether the National Executive or the State Executive has
those powers. I see no real difficulty in the construction of the rules as suggested by the applicants when it comes to the power to deal with the property of the Union under the rules of the Branch and the federal body. There is a substantial issue to be tried on this question.
As I said previously, ~f the National Rules are to
be given, on their proper construction, a wlder construction then, immediately, a serious question arises for decision as
to whether those rules as so construed contravene sub-section 140(1) of the Act. Here it must be remembered that the members of the Victorian Branch have elected their officers,
there has been a vote, and a result declared. The applicants
defeated the pre-existing membership. A new committee has come into power. It has powers of management, and it should
be given the opportunity to exercise those powers. The will
of the electorate, being the Victorian Branch members, should not be frustrated by actions of the National Executive.
If I am wrong on each of those matters nevertheless
I am still satisfied that there IS a serious issue to be tried on a matter of fact namely as to whether what has been done by the Natlonal Executive has been done bona fide for the purposes of the powers conferred by the National Rules.
In this regard reference is made to Allen v Townsend (1977)31 F.L.R. 431 per Evatt J and myself at pp.483-489. See also Scott v Jess (1984) 3 F.C.R. 263.
It is undesirable for me to say much about the
issue of fact arising here. It is essentially a question of fact and inferences to be drawn from fact. There has been no
oral evidence given to the Court. There has been no
cross-examination, and the Court is not in a position to express any views as to the veraclty of various witnesses and
what intentions were activating the members of the National
Executive. At the trial these matters may well be gone into in far greater detail. It is sufficient for present purposes
for me to say that I am satisfied a serious questlon arises on this issue. I will indlcate some of the matters upon which I have based that view. First, it seems that the actlvities of the National Executive appear to have been the result of carefully laid plans. In this regard I refer to
I
the letter of 23 June from the then Branch Secretary, Mr Darroch, who is a respondent in the present proceedings, to the manager of the Commonwealth Bank of Australia. This letter was sent on the day before the declaration of the poll. It was a letter In the following terms, and I quote:
"Please add these as additional signatories to operate the Branch's accounts registered with your
Er anch. " The authority for these additions is set out in rule 7(7)(a) and (b) of the Federated Clerks Union of Australia as certified by the Registrar of the
Conciliation and Arbitration Commission ofAustralia."
The additional signatories were those of Mr Maynes
and Mr Sullivan, the National President and National Secretary.
In a letter from the Commonwealth Bank to the
solicitors for the applicants dated 7 July 1988, a copy of
that letter was forwarded and in the letter from the bank the following paragraphs appear:-
"We mention that by letter to the Bank dated 2 3 June 1988 signed by the then Secretary of the Victorian branch of
Maynes, National President and T W Sullivan, National the Union, copy attached, a request was made for J P
Secretary, to be added as signatories to the subject accounts. The letter stated that the request for such signatories to be added was made pursuant to Rule 7(7) (a) and (b) of the Rules of the Federated Clerks Union of Australia, certified copies of the relevant clauses being provided with the above letter.
From this letter, the Bank considers that it should assume that the above two accounts are accounts to which the above rules of the Federal Union apply and, in addltion to any new authority furnished to the Bank by the relevant new office bearers of the Victorian branch of the Union, the Bank will allow operations on the accounts by both of the signatories shown in the letter
of 23 June 1988".
Counsel for the respondents argued that under National Rule 7 ( 7 ) it was compulsory for those two persons, the President and Secretary, to have their slgnatures registered f o r operating the bank accounts. He referred to the word "shall" in that rule. That rule has been in operation for quite some tlme. Apparently the obligation Imposed by Rule 7 ( 7 ) had not been carried out prior to the day before the declaration of the poll. In those circumstances an inference can be drawn that at that time, the 23rd, it may well have been apparent through scrutineers that the results of the elections were going to be adverse to the interests of the National President and National Secretary and that as part of the planning for future action it would be wise to get those signatorles registered so that they could operate the bank account of the Branch if the Branch fell under control of other persons.
Likewise there is a letter dated 2 4 June 1988 from
Nr Maynes to MC Tanner. It is obvious from the firstparagraph of the letter that this letter was written before
the declaration of the poll on 24 June. One paragraph of that letter reads: "We have also had the experience in the C&SQ Branch where a number of fulltime officials were summarily dismissed. This left the Branch with practically no
experienced personnel and that pattern has contlnued to this day. This Union would not expect a repeat of such disgraceful conduct nor would it permlt it to occur.
I
Again, I hope that thls view is also shared by your colleagues. "
This is a further indicatlon that before the declaration of the poll, Mr Maynes had a fair expectation that the result would be adverse to his interests.
Then immediately the dismissals took place on the 27th the National Executlve Committee comprising three of the defeated candidates for offlces, took steps by a series of resolutions to try and prevent the new State Executive from exercising their functions under the Branch Rules. It may be said that this is a genuine attempt to protect the interests of the organization itself. In the earlier decision in V No 21 of 1900 I refrained from maklng comments about the actions
by the State Executive in making the dismissals. I can now
say, that, on the evidence as it is before me, I think it was most unwise and undesirable and should not have been done, but as I said earlier this is one of the consequences of elections in a democratic system. Once the election takes place you are left with the results of actions taken by those elected people. The State Council can take action over the State Executlve, but otherwise, unless they are in breach of the law and any legal process takes its course, the members
who elected them are bound by those decisions.
After 27 June, the actions of the National
Executive Committee and the National Executive itself, have been swift and thorough. It may well be that on 24 June
there was apparent calm, but it is difficult to see how real that calm was having regard to the letters already referred to which anticipated that action would be taken by the State
* - 35 - Executive and that action would be thwarted by the National
Executive.Likewise it is interesting to note that in the affidavlt of MC Sullivan, who refers to this calm on the 24th, there is also reference that one of the facts in moving
him to do what the Natlonal Executive did, was the fact that the elections were sub~ect to inquiries and to use his words: "In the light of the questions as to the validity of the election and situation regardlng the organizers and the curtailment of services being provided to members attached to the Branch, I took the vlew and still believe that it was and is necessary for the Union to exert the control to which it is entitled under the rules for the protection of the union and its members as a whole."
It is not for a National Executive to take action because of claims or accusations of election irregularities. There are provisions under the Act whereby the Court, in appropriate cases, can make orders and in my opinion the fact
that other officers attempt, in effect, to usurp the power of the Court, can of itself give rise to a question of a wrong purpose for exercising a power. It seems that that was one
of the factors influencing at least one of the members of the National Executive Committee when it first commenced action with the passing of the resolutions on 27 June.
I have said enough to Indicate why I think there is a serious question of fact to be tried concerning the bona fide opere exercise of power under the National Rules.
c
- 36 -
I come then to the question of the balance of convenience. Before doing that I should say that as far as the resolutions contained I n V No 3 4 of 1988 is concerned
sufficient has been said to ]ustlfy the finding of a serious question to be tried. It is true that the wording has been Improved and that the purpose is designed to deal with the funds only but nevertheless in my opinlon there are
sufficient issues to be tried for reasons already given as to
whether the first resolution referred to in that rule to show
cause, is first withln the power of the National Rules on their proper construction and, if the rules are to have a wider construction, whether the rules are valld. Again on the question of a bona fide exercise of power a serious question arises. The second resolution is drrected to the question of the employment of the organlzers.
This relates to the
power of the National Executive to appoint organizers. I do not need to decide that question at the moment, but there is ample evidence before me to suggest that there is a serious question to be tried as to whether the engagement of these
organizers is in reality to do the work of organizers within
the Vlctorian Branch pending the decision in the State
Tribunal as to whether the dismlssal of those organizers was bad o r not.
I turn to the question of balance of convenience.
From what has been said already, in my opinion, the balance supports the applicants and for present purposes all I need
.
say is that having been elected to the offices concerned, until some order to the contrary is made in the election inquiries, the balance supports the vlew that they should be
allowed to continue with their duties of managing the affairs of the Victorian Branch. Having said that I should indicate I do not propose
to make the order sought in the form which was read out
earlier and formulated yesterday by counsel for the applicants, namely the order restraining Mr Maynes and MK Sullivan from operating the bank accounts. On this matter,
from what has been said, it is clear that any attempt by them to exercise their powers to operate the accounts of the Victorian Branch, except In special circumstances which might
arise in the futuure, would be, in all probability, in breach of the rules. If they attempted to do so , the applicants could approach the Court speedily for approprlate orders but in the absence of any evidence that there is a likelihood that MC Maynes and Mr Sulllvan will exercise those powers, it is undesirable that the restraining orders should be made.
Orders accordingly.
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