McGee, S. v J.H. Sanders

[1991] FCA 857

2 s q1

FOF GZXE3AL DISTFIBUT ON 2UDGMENT NO. .....-........ .. 1.-

IN THE F E D E W COURT	)
1
OF AUSTRALIA	1
) No. V1 70 of 1991
VICTORIA DISTRICT REGISTRY	)
1
INDUSTRIAt DIVISION	)
BETWEEN:

STEVEN McGEE AND REX HORE

Applicants

- and -

J H SANDERS h ORS

Respondents

JUDGE :	Heerey J.
PLACE :	Melbourne

DATE : 28 November 1991 07 JAN 1992

Fmmw aURi OF

EX TEMPORE REASONS FOR JUDGMENT

The two matters that I have to consider are the applicants' application for an interim order under s.209(4) of the Industrial Relations Act 1988 and the respondents' application for leave to appeal against the interlocutory order of Gray J. That order was made on 6 November 1991 and his Honour subsequently gave reasons on 15 November.

capacity as a trustee and a member of the Victorian Branch	Committee of Management of the Transport Workers' Union of
Australia was entitled to a right of access to certain specified documents of the branch. Although the order necessarily was expressed in terms of the specific documents to which access was sought, the question whether a union official like Mr McGee has a right of access to documents of his union in the same way as a company director has a right of access to documents of the company was fought as a question of general principle. I decided in substance that the right of access was the same.
I held also that such a right of access had to be exercised in
good faith for the purpose for which it was conferred. There was an attack on the bona fides of Mr McGee and I held that that attack failed.
The respondents sought and were granted a seven day stay for the purpose of considering whether an appeal should be brought from that decision, but no appeal was brought. So the present disputes have to be considered in the light of the undoubted fact that both as a matter of issue estoppel between the parties and as a matter of general law - it not being suggested to me that I should not follow my earlier decision - a union official such as Mr McGee and the other applicant,
Mr Hore, does have a general right of access to the documents of the union, subject of course to that right being exercised in good faith, the onus of establishing bad faith being on
those seeking to resist the access.
On 28 October 1991, I granted a rule to show cause why the following orders should not be made. Paragraphs 1 and 2 of the rule nisi are as follows:

The disputes in this matter have to be considered against the background of an earlier case in which the present firstnamed applicant was applicant and substantially the present respondents were respondents - that being No. V1 32 of 1991.

In that case, I held on 13 August 1991 that Mr McGee in his

1.        A direction that the respondents and each of them perform and observe the rules of the Transport Workers' Union of Australia ("the organ~zation" ) by refraining from h~ndering, obstruct~ng or preventing each of the applicants, whether alone or in the company of his or their servant or agent, from gain~ng access to, LnspectLng and obtaining copies by photocopying techniques of all records, documentation, accounts and correspondence or copies thereof within the possession, custody or control of the respondents, or any one or more of them, on behalf of the Victoria Branch (''the branch") concerning:-

(i)	the legal actron which the branch secretary was authorized by the Branch Conunrttee of Management at its extraordinary meeting on 19 August, 1991 to initiate and fund in relation to the Federal Council resolution of May 1991 concerning amalgamation which resolution also prevented branch officers and employees from putting their vrews to members;
(ii)	the purported apporntment by the Branch Cornittee of Management at its extraordrnary meetrng on 9 September, 1991 of the respondent Kerly as branch secretary;
(iii)	the acqursrtion, operation and disposition of motor vehicles managed and controlled by the branch since the 27th September, 1989;
(iv)	credrt cards issued to offrcers and employees wrthin the branch srnce the 27th Septamber, 1989 rn respect of which the branch has assumed a lrability or responsibrlrty to the issuing bank or frnanczal institutron concerned for the periodrc reimbursement of the credrt balances thereof;
(V)	the payment to each offrcer and employee within the branch since the 27th June, 1989 of monetary sums in addrtron to the amount of any regular recurring salary payable to him or her;
(vi)	the purchase srnce the 27th September, 1989 of car phones for use in motor vehicles operated, managed or controlled by the branch;
(vii)	the purchase or proposed purchase of lap top computers for use within the branch;
(viii)	the monthly branch expenditure for August 1991 of $337,690.10.

A direction that the respondents and each of them perform and observe the rules of the organizatron by treating as

null and void and of no effect the resolution purportedly passed by the Branch Committee of Management at its meeting on 21 October, 1991 whereby -

"It is resolved that -

1.       That no further inspectron should be arranged with S. McGee until he has provrded a written assurance that he wrll attend as arranged, and in default, his contrnurng entitlement to inspect will be further reviewed.

2.       The Secretary is directed and instructed that rn providing rnspection to S. McGee in accordance with the Federal Court decision, he should take all necessary steps to protect the confidentiality of the Branch's records and documents, and in partrcular, he should not permit inspectron by thrrd parties.

That insofar as S. McGee is unable to understand any particular item inspected, he should submit a written query to the Secretary, such query should be clarrfred by the Secretary with the Branch's accountant, and a reply given to S. McGee as soon as pract~cable. The Secretary is also authorrzed in approprrate circumstances to refer such queries to the branch auditors for clarrfrcation.

4.       This meetrng expresses its lack of confidence in S. Kcgee's bona frdes m seeking inspectron and accordrngly drrects the Secretary that no copres of any records or documents are to be provided to S. McGee wrthout first obtainrng from hrm a written request specifyrng precrsely the record or document rn question and his reason for wantrng a copy. Each such wrrtten request 1s then to be submitted to BCOM for consideratron.

5.        Any d~fficulties or disagreements about future rnspections should be referred to BCOM for decrsron.

The events leading up to the grant of that rule to show cause are set out in the reasons for judgment of Gray J. of

15 November and it is not necessary to repeat them in this	judgment.
Gray J. granted an interim injunction in terms of paragraph 2 of the rule nisi. As to paragraph 1, it is clear that his Honour accepted the substance of the argument put by the applicant, but did not grant the order sought. His Honour's reasons for taking this course were as follows (at p.18):

It is my view that the first order sought by the applicants ought to be unnecessary on an interim basis. As I have said, it rs undesirable that the applicants should be forced to come to Court, seeking order6 permitting them to inspect specified documents or classes of documents, on each occasion on which they wish to exercise their rights of inspection. The making of orders relating to specified classes of documents lends itself to subsequent arguments as to whether those orders have been complied with. It may also necessitate detarled orders as to times and

places and persons present. If possible, that kind of apecifrcity

should be avoided. I have endeavoured to make it clear in these reasons for judgment that the applicants have rights to inspect, take copies and be accompanied by an accountant, subject to the giving of the appropriate undertaking. It is proper to reserve the applicants' rights to proceed in respect of the first order they sought if their rights are not afforded to them.

Subsequently to the order of 6 November there were a number of attempts by the applicants to obtain access to documents at the branch office of the union. These attempts occurred on 11, 13 and 18 November. There is a dispute of fact as to what occurred on these occasions. The substantial case being urged by the respondents was that the applicants, or more particularly, Mr McGee, behaved in a provocative and disruptive manner and asserted a right to, as it was put in argument, range at large through the documents of the branch. These matters were urged as grounds for not granting the injunction sought.

It was also said that the applicants had not insisted on the right asserted in paragraph 1 of the rule nisi in that they had not sought the documents referred to therein, but rather documents at large. It was said further that there was no urgency disclosed by the nature of the documents described in

urgency and that if as a result of the election the applicants	paragraph 1, some of which relate back to 1989. It was said that the current election for the union provided no ground of	lost their standing to bring this claim, then that was not a relevant consideration.
On the question of urgency, I should add that when this matter commenced today, after consultation with the judge in charge of the list, I fixed the trial for hearing on 19 and 20 December. However, counsel at the outset gave an estimate that the trial would take more than two days and my further acquaintance with this matter confirms the likelihood of that estimate being correct. Accordingly, I have vacated that order fixing those trial dates because it seemed to be quite pointless having a hearing at that stage just before the vacation, which would not resolve the issue anyway. Therefore, in terms of urgency, the applicants' claim has to be considered against the fact that the trial will not be heard until at least early February next year.
I propose to grant the interim injunction sought and I shall state the reasons which have led me to that conclusion. Firstly, I respectfully agree with the view which Gray J. took, that the claim of the applicants for access to the documents referred to in paragraph 1 of the rule to show cause is very strong, given the establishment of the general principle of the right of a union official to lnspect the documents of the union.
The matters which a court must consider in granting relief of this sort are now well established and probably the most convenient re-statement is in The Australian Coarse Grain Pool Ptv Ltd v The Barlev Marketina Board of Oueensland (1982) 57 ALJR 425. I should add that in Bullock v The Federated Furnishina Trades Societv of Australasia No. 1, (1985) 5 FCR 464 at p.472, in referring to those well established criteria of a serious question to be tried and balance of convenience
the Court said:

..... an apparently strong claim may lead a court more readily to

grant an injunct~on when the balance of convenience is fa~rly
even. A more doubtful claim (whlch nevertheless raises "a
serious question to be tried") may still attract interlocutory
relief if there is a marked balance of convenience in favour of
it.

In the present case, when the matter was heard before Gray J., there was no evidence adduced by the respondents to lay the basis for any claim that inspection of the documents referred to would cause any hardship or loss. The sole ground, it would seem, for opposing the order sought before his Honour was a renewal of the attack on the bona fides of the applicants, an attack which his Honour rejected.

As far as I can ascertain, there was no fresh evidence produced to support that attack and, as I have said, a similar attack had been made in the hearing before me and rejected.

What is said now on behalf of the respondents is that it would be wrong to preclude them from contesting outstanding issues as to the right of access, namely, the right to have another person accompany the union official exercising the right and the right to take photocopies. Further, it is said that the right to inspect the documents would cause disruption. It seems to me that if there is a right to inspect these documents, as is accepted, I should frame an order which will enable that right to be exercised in a way which will preserve such arguments as the respondents may wish to advance at the trial. I propose to do that by an order which will direct that the applicants have access to the documents referred to in paragraph 1 of the rule to show cause and that for the purpose of that access they may be accompanied by a specified agent, namely, the accountant, Mr Robert Adamson. Mr Adamson has sworn an affidavit, giving an undertaking to respect the confidentiality of any documents he has inspected. Despite a

because he is no longer a member of the Association of

somewhat half-hearted suggestion that Mr Adamson is unsuitable

Certified Practising ~ccountaits, it does not seem to me that any valid ground of objection has been made to his being present.

If there is a right to inspect documents it seems to me very strongly arguable indeed that the right would be meaningless unless the person exercising the right was able to take with him a person whose expertise might be necessary and, in particular, an accountant, subject of course to meeting any reasonable terms as to confidentiality or any particular objection to the accountant or other person accompanying.

The same may be said about photocopying. It could not be rationally suggested to my mind that a right of access to documents can be meaningfully exercised without the right to take copies. One might ask rhetorically whether the person making the inspection is supposed to memorise piles of financial documents. If a person is entitled to take notes, I see no rational distinction between that and taking photocopies.

I shall direct that the access to which I have referred will take place on Wednesday morning, 4 December 1991, at the premises of the Victorian branch of the union at 52-56 Rouse Street, Port Melbourne.

I shall finally add in relation to this aspect of the matter that I advert particularly to the concluding words of section 209(4), which give power to the court to make such interim orders as it considers appropriate and, in particular, orders intended to further the resolution within the organisation concerned of the matter the subject of the application. In this context, the matter the subject of the application is the access to documents. That right of access has been established by a decision of this court, which has not been the subject of the appeal. I am not seeking to apportion

blame on any particular persons as I appreciate there are conflicting allegations of fact which have not been resolved,

but it seems to me deplorable that considerable amounts of money, time and effort have been spent in returning to this court after the general principle of access to documents has been established.

I respectfully share Gray J.'s view that it would seem practically undesirable to keep making orders in terms of specified documents or classes of documents leaving persons to return to the court every time they want to see a different sort of document.

Everything I say is subject to what I, to the point of being boring, have endeavoured to stress, that there is this right of access and it should be respected and everybody should try and act in a civilised and common sense fashion.

The fact that I direct a particular time to try and minimise the risk of shadow boxing that has occurred up until now, does not of course mean that the right does not exist. It does exist as a matter of law.

I turn to the application for leave to appeal. An application of a similar nature was considered by Northrop J. in Lewis v Mavnes (Unreported, 19 September 1988). 1 do not propose to cite any particular passages from his Honour's judgment, but simply to say that I respectfully adopt his Honour's approach.

I do not propose to grant leave to appeal. I do not think the essential requirement of showing that the decision appealed from is wrong or attended with sufficient doubt has been established. The question of the alleged disruption by the applicant, subsequent to Gray J.'s order, does not seem to me to bear on the legal correctness or otherwise of the order.

I think because of the view I have taken on the application

for a stay also. for leave to appeal, I should logically refuse the application I certify that this and the preceding eight (8) pages are a true copy of the Reasons for Judgment of the Honourable M r Justice Heerey

ADDearances

Counsel for the Applicants:	MS M R Hickey
Solicitors for the Applicants:	Holding Redlich
Counsel for the Respondents:	Dr C Jessup QC with

Mr T Hurley

Solicitors for the Respondents:  Harry Nowicki & CO