McLeish, David v Faure, C.W

[1979] FCA 88

McLEISH v. KANE (No. 2) (1979) 41 FLR 152
Conciliation and Arbitration

COURT

FEDERAL COURT OF AUSTRALIA

INDUSTRIAL DIVISION
J.B. Sweeney(1), Evatt(1) and Northrop(1) JJ.

CATCHWORDS

Conciliation and Arbitration - Registered organization - Performance and observance of rules - Amendments to rules - Ballot of membership - Powers and duties of national council - Conciliation and Arbitration Act 1904 (Cth.), s. 141.

HEADNOTE

The claimant sought orders under s. 141 of the Conciliation and Arbitration Act 1904 that the respondents being members of the national council of a registered organization perform and observe the rules thereof by altering the rules to give effect to the result of a ballot of members. Rule 10 dealing with the powers of the national council was in relevant parts as follows:

"10. The national council shall be the supreme governing body of the union and . . . its decision on all matters . . . shall be final and binding on all members unless two branches shall demand a ballot of all financial members on any question as provided by r. 20. The national secretary shall forthwith hold such ballot and the decision of the members so ascertained by ballot shall be binding upon the national council and all officers and members of the union.

10 (a) . . . the national council . . . shall have the general control and conduct of the business and affairs of the union. The actions and decisions of the national council shall be final unless negatived, as provided in r. 20, or otherwise dealt with by a majority of the members of the union by a referendum or by a special conference.

10 (b) Unless otherwise provided, the national council shall have the power: (8) to give effect to any decision of a ballot of members taken in accordance with the rules. . . . (15) to alter, amend, rescind, or enact rules of the union."

Rule 57 which was entitled "New Rules and Alteration of Rules" stated: "No new rule shall be made, nor shall any of these rules, for the time being, of the union, be amended, altered or rescinded except by and at a meeting of the national council."

Held: (1) The power to make new rules was contained in r. 10 (b) (15) and was subject to the provisions as to referendum and ballots of financial members set out in that rule.

(2) Accordingly the national council and all officers and members of the organization were bound to give effect to the decisions of the members ascertained by the ballot.

HEARING

Sydney, 1979, August 7-8; September 10-11. #DATE 11:9:1979

RULE NISI.

The facts appear from the judgment.

R. P. Meagher Q.C. and L. Lamprati, for the claimant.

R. C. Kenzie, for Dolan and the Electrical Trades Union in matter 22 of 1978, and for Dolan in matters 24 of 1978 and 10 of 1979.

P. R. A. Gray, for Faure, Auchterlonie, Turnbull, Emery, Colthorpe, Allen, Ryan, Gilbert, Devereaux, Kane and Walker.

B. C. Hungerford, for O'Brien, Pitt, Glastonbury, Christiansen and Price.

Solicitors for the claimant: T. D. Kelly & Co.

Solicitors for Dolan and the Electrical Trades Union in matter 22 of 1978, and for Dolan in matters 24 of 1978 and 10 of 1979: Turner, Freeman & Co.

Solicitors for Faure, Auchterlonie, Turnbull, Emery, Colthorpe, Allen, Ryan, Gilbert, Devereaux, Kane and Walker: J. N. Zigouras & Co.

Solicitors for O'Brien, Pitt, Glastonbury, Christiansen and Price: Kenneth J. Hickey & Co.

T. J. GINNANE

JUDGE1

September 11.

THE COURT delivered the following written judgment.

These three matters all arise out of a consideration of the rules of the Electrical Trades Union of Australia. These rules have been before the court in a number of recent matters. In the judgment of the court in McLeish v. Faure (1979) 40 FLR 462 , judgment was given on 23rd July last. In that judgment the history of the litigation was briefly set out. At that stage the dispute between the parties was whether the national council was obliged to give effect to the results of a ballot of the members voting on a proposed amendment to the rules. The court was then asked to determine whether the proposed amendment would if adopted be in disconformity with s. 140 of the Act. We were advised that if this question was decided the parties would be able to confer and that no further difficulties would appear to arise. (at p153)

1. The court for reasons then set out made a declaration in the following terms: "Pursuant to s. 21 of the Federal Court of Australia Act 1976 the court declares that the alteration to the rules of the Electrical Trades Union of Australia approved by a majority of financial members of the union at a ballot which was completed on 23rd March, 1979, is not contrary to s. 140 (1) of the Conciliation and Arbitration Act 1904 as amended" (1979) 40 FLR, at p 476 . (at p154)

2. It now appears that the discussions contemplated have not taken place and that the parties are still at arm's length. The court records its regret that this should be so. It has in previous proceedings adopted courses which seem best calculated to avoid embarrassment to the union by, for example, after finding that r. 9 (d) in matter 22 of 1978 was contrary to the Conciliation and Arbitration Act 1904 (Cth.), adjourning the proceedings rather than making a declaration. (See McLeish v. Kane (1978) 36 FLR 80 .) This sort of action seems, however, not to have been appreciated and we regret that there has been no corresponding co-operation between the parties. (at p154)

3. The question we are now faced with is whether under the rules a question of amendment of the rules may be referred to the members by referendum and whether the results of such a referendum require the national council so to alter the rules as to conform with the expressed wishes of the members. (at p154)

4. The relevant rules are rr. 10 and 57, of which relevant parts were set out in the judgment of 23rd July, 1979. (at p154)

5. In addition r. 10 (a) provides: "(a) Subject to the provisions of any State Trade Union Act so far as members of the branch to which such Act applies, the national council shall act in all matters referred to it by a branch, and shall decide in all cases for which no provision is made in these rules, and shall have the general control and conduct of the business and affairs of the union. The actions and decisions of the national council shall be final unless negatived, as provided in r. 20, or otherwise dealt with by a majority of the members of the union by a referendum or by a special conference." (at p154)

6. The submission made by Mr. Gray and Mr. Kenzie of counsel is that having regard to the nature and language of r. 57 a rule may not be altered except by a meeting of the national council. It is argued that reading this rule with r. 10, r. 10 must be read down. While r. 10 uses the words of the national council "that its decision on all matters . . . shall be final and binding on all members unless two branches shall demand a ballot of all financial members on any question", the rule goes on to provide in par. (a) "the actions . . . of the national council shall be final unless negatived . . . or otherwise dealt with by a majority of the members of the union by a referendum". (at p154)

7. In addition, the first paragraph of r. 10 contains the words "the decision of the members as ascertained by ballot shall be binding upon the national council and all officers and members of the union". (at p154)

8. Looking at the rules as a whole the position seems to us quite clear. The power to make new rules is in our view drawn from r. 10 (b) (15) and it is subject to the provisions as to referendum and ballots of financial members set out earlier in r. 10. The purpose of r. 57 and the only thing achieved by it is to prevent the national council exercising the power given to alter rules by correspondence, telegram, etc., as provided in r. 9 (g), (h) and (i). (at p155)

9. The terms "by a meeting" and "at a meeting" seem to us identical in meaning. What is done or what cannot be done except by a meeting also cannot be done except at a meeting. The phrase "by and at" used in r. 57 does nothing more than add an emphasis to this and indeed is rather a draftsman's flourish. We are therefore of the opinion that a ballot of members having been held on the proposed amendments as set out in the judgment of 23rd July last, the national council and all officers and members of the union, including the executive and council members, are bound to give effect to the decision of the members ascertained by the ballot and the order we propose is designed to ensure that the obligations imposed by the rules are carried out. (at p155)

ORDER

ORDER

THE COURT ORDERS THAT:

1. The respondents and each of them perform and observe the rules of the Electrical Trades Union of Australia and gives the following directions:

(a) That on or before Friday 14th September, 1979, the national secretary, or in his absence the assistant national secretary, and the president, or in his absence the vice-president, convene a meeting of the national executive to be held at the registered office of the union on or before Friday 28th September, 1979, for the purpose of calling a special meeting of the national council.

(b) That the national secretary or in his absence the assistant national secretary pursuant to r. 14 of the rules of the union give notice in writing of the meeting of the national executive and the national secretary or assistant national secretary respectively shall forward with the notice of meeting a copy of this order.

(c) That each of the respondents being a member of the national executive take all steps necessary to ensure a quorum at the meeting of the national executive.

(d) That each of the respondents being a member of the national executive shall ensure that the meeting of the national executive call a special meeting of the national council to be held at the registered office of the union on or before Friday 9th November, 1979, for the purpose of altering the rules of the union as hereinafter directed.

(e) That the national secretary, or in his absence the assistant national secretary, pursuant to r. 16 of the rules of the union prepare an agenda paper prior to that meeting and include in that agenda the alteration of the rules of the union as hereinafter described.

(f) That the national secretary, or in his absence the assistant national secretary, shall on or before Friday 5th October, 1979, give notice in writing of the special meeting of the national council to the claimant and to each of the respondents and shall forward with the notice of meeting a copy of the agenda paper and a copy of this order and shall at the same time forward to each branch of the union a copy of the agenda paper and a copy of this order.

(g) That each of the respondents take all steps necessary to ensure a quorum at the special meeting of the national council.

(h) That each of the respondents shall ensure that the special meeting of the national council alters the rules of the union as follows:

"(i) Rule 9 - National Council. That sub-r. (d) be deleted and the following be inserted in lieu thereof: '(d) At all council meetings each branch shall have the right through its delegate or delegates to exercise one vote for each 500 members of the branch. The national secretary shall have the right to exercise two votes.'

"(ii) Rule 10 - Powers and Duties of National Council. That the words 'unless two branches shall demand a ballot of all financial members on any question as provided by r. 20. The national secretary shall forthwith hold such ballot and the decision of the members so ascertained by ballot shall be binding upon the national council and all officers and members of the union' be deleted from the first paragraph and the words 'subject to any referendum that may be conducted pursuant to r. 20' be inserted in lieu thereof.

"(iii) Rule 13 - National Executive. That r. 13 be deleted and the following be inserted in lieu thereof: 'The national executive shall consist of the president, vice-president, national secretary and members elected from the national conference delegates. Each branch shall be entitled to representation on the national executive by one executive member for which purpose the president and vice-president shall be deemed to represent the branch of which they are members and the national secretary shall be deemed not to represent any branch, providing that any branch having in excess of ten per cent of the membership as calculated under sub-r. (e) of r. 9 - National Council, shall be entitled to one additional executive member for each additional ten per cent of the membership of the union possessed by that branch.'

"(iv) Rule 14 - Powers and Duties of National Executive. That the following new sub-rule be added to r. 14: '(g) The national executive shall have power to appoint a returning officer for the purpose of conducting such referenda as may be requested pursuant to r. 20.'

"(v) Rule 20 - Limiting Action of National Council or National Executive. That r. 20 be deleted and the following be inserted in lieu thereof: '20. Control of National Executive and National Council by Members (1) If in any period of four months, (a) any two State councils, or (b) members totalling five per cent of the total financial membership of the union by petition, shall request that a referendum of members be held on a proposal that national council or the national executive take or refrain from taking any specified action or adopt or refrain from adopting any specified policy in the conduct of the union's business the national executive shall within fourteen days appoint a returning officer (not being the holder of any other office in nor an employee of the union or a branch or sub-branch of the union) who shall forthwith proceed to conduct a referendum of members in all branches on the proposal. Such referendum shall be by secret ballot of all of the members of the union who are financial for the quarter preceding the date of the commencement of the ballot, provided that if a proposal, the subject of a request under this rule, be adopted by the national council or the national executive as the case may be, no referendum shall be held under this rule.'

(2) The result of the referendum shall be given effect to by the national executive or the national council as the case may require."

(i) That upon the national council altering the rules of the union as aforesaid the national secretary or in his absence the assistant national secretary forthwith shall file particulars of the alteration in the office of the industrial registrar and shall take all reasonable steps to obtain the certificate of the Industrial Registrar required under s. 139 (4) of the Conciliation and Arbitration Act 1904, as amended.

2. This order be entered forthwith.

3. Liberty be granted to any party to apply on three days' notice to the court and to the other parties to have this matter relisted for mention.