McLeish v Kane

THE FEDERAL COURT OF AUSTRALIA )

)	No. 22 of 1978

INDUSTRIAL

DIVISION

NEW SOUTH

WALES

DISTRICT

REGISTRY

BETWEEN:

DAVID MC LEISH

C l a i m a n t

R e s p o n d e n t s

O R D E R

JUDGES MAKING ORDER:

J.B.

SWEENEY,

P H I L L I P EVATT and NORTHROP JJ.

DATE

OF ORDER:14

N o v e m b e r 1978

WHEm MADE: Sydney

THE COURT ORDERS THAT:

The matter stand adjourned t o 13 February 1979.

Liberty t o

any party t o apply on 7 days notice t o the C o u r t and t o other

parties.

IN THE FEDERAL COURT

OF AUSTRALIA )

1 No. 24 of 1978

DIVISION

INDUSTRIAL

1 1

NEW SOUTH WALES

DISTRICT

REGISTRY

)

r -

BETWEEN: N.D.

KANE, G.C.

COLTHORPE,

C.J. EMERY, C.W. FAURE,

I. AUCHTERLONIE, E.J .

TURNBULL,

K.B. GILBERT, S.D. ALLEN, T.D. RYNN, J.R. DEVEREUX, M.A. WALKER and C.O. DOLAN

Applicants

AND:

DAVID MCLEISH, J.E. O'BRIEN,	.
D.I. CHRISTIANSEN, F.D. PRICE

M.G .H. PITT, R.M. GLASTONBURY,

Respondents

O R D E R

JUDGES MAKING ORDER:

J .B.

SWEENEY, PHILLIP

WATT and NORTHROP

JJ.

DATE OF ORDER:

14 November 1978

WHERE MADE:

Sydney

THE COURT ORDERS THAT: The matter stand adjourned to 13 February 1979. Liberty

to any party to apply on

7 days notice to the Court and

to other partles.

IN THE FEDERAL COURT OF AUSTRALIA	)
INDUSTRIAL DIVISIObT
i

NEW SOUTH

WALES DISTRICT REGISTRY

IN THE MATTER

of the Conclliation

and Arbltration Act

1904

AND IN THE MATTER

of an appllcation

pursuant to Section

l40 and Sectlon

141 of the said Act.

BETWEEN:

DAVID MC LEISH

Claimant

N.D. KANE, G.C. COLTHORPE,

G.J. EMERY, C.W. FAURE,

I. AUCHTERLONIA

, E. J

- TURNBULL,

J.E. O'BRIEN, G.H. PITT,

R.M.	GLASTONBURY, D.I.

CHRISTIANSEN, F .D. PRICE, K.B. GILBERT. S.D. ALLEN,

T.D. RYNN, J.R. DEVEREUX,

M.A. WALKER and C.O. DOLLN

Respondents

(No. 22 of 1978)

AND IN THE MATTER

of an applicatlon

pursuant to Sectlon	171 C of the
said Act.
BETWEEN :

N.D. KANE, G.C. COLTHORPE,

C.J. EMERY, C.W. FAURE,

I. AUCHTERLONIE, E.J. TURWBULL,

K.B. GILBERT, S.D. ALLEN,

T.D. RYNX, J.R. DEVEREUX,

M.A. WALKER and	C.O. DOLAN
Applicants

DAVID MCLEISH. J.E. O'BRIEN,

M.G .€I. PITT, R.M. GLASTONBURY,	I
l

D.I.

CHRISTIfANSEN, F.D. PRICE

Respondents

(No.24 o f 1978)

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corn:

J.B.

SWEENEY, PHILLIP EVATT, and NORTHROP

JJ.

DATE :

14 November, 1978

REASONS FOR JUDGMENT

SWEENEY, EVATT and NORTHROP

JJ.:

The Court has before

it two applications. The first appllcation is by

Nr David

I	McLeish, a member of the Electrical Trades Union of Australla,

' an organization registered under the Act (the

E.T.U.) and

the New South Wales Branch Secretary and Delegate to National

Council of the

E.T.U. and is brought under

s.140 and s.141

of the Commonwealth Conciliation and Arbitratlon Act

1904

(the Act). The first application seeks orders first that Rules 9(a) and (a), 10, 13 and 20 of the Rules of the E.T.U.

contravene s.140(1) of the Act and secondly

mder

s.141 of the Act against the individual respondents who

are all members

of the E.T.U. and members of the National

Council of the

E.T.U.

These respondents in most cases

hold also other offices within the organization. The

second part of the application seeks an order that the

respondents other than the E.T.U. perform and observe

the Rules of the E.T.U. by treating as null and void

resolution of the National Council. The ground

of attack

under s.141 depends upon

a finding by the Court in the first

part of the

apphcation that the rule under which the Natlonal

Council was convened and voted

contravene s.ldO(1) of the

Act and so contravened that section at the relevant time.

The second application is one brought under

s.171C of the Act by

a number of members of the

E.T.U. seeking

the determination of the question of whether certain

invalidities have occurred

in the management or administration

of the E.T.U. and if	so seeking orders valldating certain
acts.

We deal first with the attack on the rules.

. /3 .

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Those challenged are rules 9(a) and

(a), part

of rule

10, rule 13 and rule 20.

Rules 9(a)and (d) are challenged

as being contrary to regulation 115(l)(d)(v), as being

contrary to s.2(e) and (f), being two of the objects of

!	the Act and as imposing upon members conditions, obligatlons or restrictions which having regard to the objects of the Act are oppressive, unreasonable or unjust.

Rule 10 it is said, having regard to the objects

of the Act, is

so obscure and vague as to be meaningless

and hence is oppressive or unreasonable. It is further

claimed that since it makes provlsion for

a plebiscite

and there is no manner in which glven number or proportion

of members as distinct from branches may obtain

a pleblscite,

the rules do not provide for control of committees and the

rules are contrary to regulation

115(l)(d)(v).

Rules 13 and 20 are both attacked as imposing upon members conditions which having regard to the objects

of the Act and the purposes of registration of organizations

are oppressive, unreasonable or unjust.

Orders Nisl were granted

in the application

under s.140 and s.141 and on the directions hearing then fixed,

both parties made application under

s.13.E that the proceedings

be heard and determined by	a Full Court and an order to this
effect was then made.

Before considering the rules

in detail, it is

desirable to look briefly at the structure of the organization. Wales Branch and members in the Northern Territory are attached to che Queensland Branch. The branches each elect officers and committees and admit members and collect contrib-

It has been registered for many years and has six branches

throughout the Commonwealth. These branches appear to be

one in each State of the Commonwealth. Members in the

utions from them. Eighty-seven and

a half per cent of the

./4..

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moneys collected are retained by the branches and it is

clear that they are strong and viable units of organization

within the

E.T.U.

The bulk of the officers are elected by

branches and having regard to the division

of funds.it would

seem that the majority

of the activities of the

E.T.U. are

in fact carried out by branches.

The rules secure to the branch important activities

and a real degree of autonomy. In the

E.T.U. federally, there

exists a National Council which consists of the General Secretary

and delegates elected by each branch. The delegates elected

are one from

a branch not exceeding

1,500 members, three

delegates from

a branch exceeding

1,500 but not exceeding

7,999 members and the rules then provide that

a branch

with a membership of

8,000 or over may send four delegates.

Delegates then have

a right to exercise votes according to

the membership

in the branches and this is provided

in the

following table as set out

in r.9(d).

1 - 1000 members

2 votes

1001 - 2000 members	..	3 votes
2001 - 3000 members	..	4 votes
3001 - 3500 members	..	5 votes
3501 - 4000 members	..	6 votes
4001 - 6500 members	..	7 votes
6501 - 9000 members	..	8 votes
9001 - 11500 members	..	9 votes

11501 members and over

10 votes

In addltion, the National Secretary has

a right

to exercise one vote. In cases where delegates are entitled to exercise a number of votes greater than their number as in, for example, the case of New South Wales where three delegates exercise ten votes, it does not appear how these

votes are to be exercised whether by direction of the branch,

decision of the majority of delegates or by each delegate

exercising some of the votes

in the proportion the number

of delegates bears to the number

of votes to be exercised.

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The absence of such provision does not affect our view as

to the rules but in the light of the fact that it will not

necessarily be the case that all members of the branch

support a particular view or indeed that all delegates

support a particular view it

is, we thlnk,

a provision

which might usefully be made. The National Council

meets annually and there

is provision for special meetings

of it to be called.

The annual meeting of

the National

Councll is referred to in the rules as the National Conference.

The rules provide for the election of the

National Secretary and the National Assistant Secretary

by ballot of the financial members and for the electlon

of the National President and National Vice-President

I	by the National Council.

In addition to the National Council, there is

a National Executive of

9 members comprising the National

President, National Vice President and National Secretary

and either one or two branch representatives. Each State

branch 1s entitled to one representative on the National

Executive but if the Natlonal President and National Vice

President are members of a particular branch they are deemed

to represent that branch on the National Executive and in

that circumstance the partlcular branches will be entitled

to two representatives

on the National Executive.

In addition to the National Executive,

National Executive Committee consisting of the President,

Vice President and Natlonal Secretary is established. The

National Executive meets between meetings of the National

Council and may

be convened by the National Secretary

and Presldent while the National Executive Committee

meets to deal with urgent matters between meetings	of the
National Executlve.

./6..

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First we consider rule

10. The particular

portion of this rule whlch

is attacked is as follows

"The National Council shall be the -supreme governing

body of the Union and

... its decision on all matters

... shall be final and

bindmg on all members unless

two Branches shall demand

a ballot of all flnancial

members on any question as provided by Rule

20. The

National Secretary shall forthwlth hold such ballot

and the decision of the members

so ascertained by

ballot shall be bindlng upon the National Council

and all officers and members of the Union."

Sub-rule lO(a) provides:

' I . . .

the National Council shall act in all the matters

referred to It by

a Branch and shall decide in all

cases for which no provision

1 s made in these Rules,

and shall have the general control and conduct of

the business and affairs of the Union. The actions

and declslons of the National Council shall be final

unless negatlved, as provided in Rule

20, or other-

wise dealt with by

a majority of members of the Union

by a referendum or by

Sub-rule 10(b) provides that, unless otherwise provided, the

National Council shall have the power:

a special conference."

"(8)

To give effect to any decision of

a ballot of

members taken In accordance with the Rules"

and (12):

"To submit any matter to the members for decision

by ballot".

Rule 20 is headed "Limiting Action of National Council or National Executive" and provides:

"Decisions of National Council and/or National a resolution for the purpose of directing or limiting any action taken or about to be taken

is carried by any two Branches at specially

summoned State Council

Meetmgs held within

forty-two days of the National Secretary

notifying the Branches of such National Council

or National Executive decision."

The rule further provides that the President

upon receiving notice of a resolutlon is to issue instructions

restraining the National Secretary from proceedlng until

./7..

“the resolution passed by the two Branches referred

to shall have been submitted to and considered by

the whole of the Branches of the Union and

in the

event of

a majority of members present at specially

summoned State Councll Meetings

in a ma-~ority

of the

Branches upholding the

objection referred to, no

further action shall be taken by the National

Council or Executive until the next National Council

Meeting”.

Rule 10, then, provides for

a referendum “as

provided by Rule 20” and provides for the decisions of the

’	National Council to be flnal unless negatived as provided in Rule 20 or otherwise dealt with by referendum or speclal conference.

Two constructions of rule

10 were urged upon us.

The first was that where first used in rule

10, the words

“as provided by Rule20” qualified the word “demand“.

The

effect was then that the demand for

a ballot of financial

members had to be made as provided in rule

20, i.e. by two

Branches at specially

smnoned State Council Meetings.

The second submission was that rule

10 dealt

with ballots of financial-members “as provided by Rule

20“

but that since rule

20 dealt only with demands by specially

summoned State Council Meetings and resolutions carried by

the members of the State Councils, the phrase had no clear

application when used in rule

10 and left the rule

obscure and meaningless as to be unreasonable etc. as

referred to in s.l40(l)(c). It was also claimed that

since the only provislon for

a vote was for

a vote among

members of State councils of Branches, the rules dld not

sufficiently provide for control of committees by the

members as required by regulation 115(l)(d)(v)-

The rules are not easy to interpret and no doubt

have grown over the years with changing emphasis on particular

provisions. We think, however, that if such an lnterpretation

is fairly open they should be construed to give

a rule a

meaning rather than holding it meaningless wlth no effect

at all.

.	. / 0 . .

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On this basis we regard the words "as provided by Rule 20" where first appearing in rule

10 as quallfying

the word "demand". On this basis the rule would provide

for a referendum of members on particular issues when this

was demanded by any two Branches at specially summoned

State Council Msetings of those Branches. When such

a demand

is made it is the duty of the National Secretary forthwith

to hold such

a ballot and in our view,

in addition to

holding the ballot, his duty is to submit the resolution

of the two State Branches to the other State Branches concerned

to allow them to take action under rule

20. If action were

taken by the Branches under rule	20 the results would be as
follows :

_ . On the resolution by two branches at specially

summoned meetings of their State Councils within until the question of its implementatlon had been

42 days of the resolution the decision of the

submitted to the other branches. If

a malority

of the members present at State Council Meetlngs

in a majority of branches so resolved the decision

of the National Council would not be further

implemented untll the next National Council meeting

The two branches by their State Councils could also

carry a resolution requirlng

a referendum of all

members and if this were done it would be

a demand

within the meaning of rule

10 and the National

Secretary would then be obliged to proceed to hold the ballot of all financial members. There are no

detailed provisions for the holding

of such a ballot

but it is clearly the duty of the Secretary to hold

the ballot and

to use his discretion as to. the

manner of holding

It providing the discretlon is

exercised bona fide and in

a reasonable manner.

So interpreted the rule is not vague or

obscure as to be unworkable and it does not in our view

offend agalnst any of the provisions of s.140. The holding

of a referendum is

a cumbrous and expensive action for any

union to take and it seems to us entlrely reasonable in the

case of this Union and its rules that it should benecessary for it to

be taken only if two or more branches by their State Councils

so resolve.

. / g .

j	.\ .	I
I	I

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On the interpretatlon we have given to rule

it is clearly operative and not

so obscure as to offend agalnst

s.140.

As Ire have said, the taking of

a referendum of all

financial members is an expensive undertaking. The Union

has some

40,000 members and it would be necessary

in the

taking of

a referendum for the printing of

a ballot paper,

for the provision of some statement of cases for and against

and for the despatch of

a ballot paper by post. In addition,

it would be necessary for

a return envelope to be enclosed

and for postage on this to be paid by the organization. The

holding of

a referendum then is no light matter and we think

that the requirement that it should be sought by not less

than two Branches is entirely reasonable. If

a group of

members desires a referendum we think it reasonable that it should have the support of at least two Branches and we

do not regard such

a requirement having regard to the objects

of the Act and the purposes of the registration of organizations

under the Act as oppressive, unreasonable or unjust. It

follows then that rule

20 is, as is the case with rule

10,

in our view not successfully challenged.

Rule 13 provides for

a National Executive. It

is an administrative body which meets between meetings of

the National Council and which exercises its powers subject

to the overriding control of National Council. Any decision

of the National Executive may be held up and prevented

from taking effect by the procedure provlded under rule

20.

A special meeting of the National Council may be called by

the National Secretary and Presldent or as the NationalCouncil or ' is primarily an administrative body. It is necessary

for it to be a small body that it may function and secondly it seems clearly necessary that each Branch should be

represented on it. Having regard to the power

in rule 20

to ensure a moratorium in respect of any action and having regard to the overriding power of National Council, we

think

rule 13 is

not

unreasonable,

Oppressive

Unjust.

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_ _

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It is true that smaller Branches have the same voting power

as do large Branches but

we thlnk that taking into account

its administrative functions, the need for such Branch to be represented on it and to the overriding powers of the

National Council rule

13 having regard to the

ob~ects

of the

Act and the purposes of the registration of organizations under

I	the Act is not oppresslve, unreasonable or unjust.

We turn then to rule

9 on which the major attack

was made.

It establishes the National Council of the

organization and while the number of delegates

is limited

to a maximum of four from

a Branch, delegates have voting

rights in accordance with rule 9(d).

On the evidence, New South Wales is and has been

for a number of years the biggest Branch. Its membership

has ranged from

48% of the total members to

43%. The next

biggest Branch is the Victorian Branch and the other Branches

then have lesser numbers.

Provlsion is made as already stated in rule 9(d)

for the exercise of votes according to the scale there set out.

The effect is shown by the following table. It should be

added that the calculation of the membership here is done

by applying a formula which is set out in the rules. By

thls formula the amount of contributions and entrance fees

received is divided by the annual contribution fee for adult

tradesmen. The effect of this is that since there are in

each Branch entrance fees and there may be received in any

one year arrears

of contributions the figures do

m t reflect

the exact number of members but they clearly show the

relative position as. between Branches. The table is as

follows :

Kembers

Votes

New South Wales

22656

Victoria

10921

Queensland	8536	8
South Australia	4753	7
Western Australia	3766	6

Tasmania	1899	3
National Secretary	1

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The evidence further showed that,

COlllpdIing

the membership ascertained in the

same way, the

percentage of membership and percentage of votes each

branch received, are as appears in the following table:

% of Membership % of Votes

New South Wales	43.1	22.7
Victoria	20.7	20.4
Queensland	16.3	18.1

South Australia	9.0	15.9
Western Australia	7.1	13.6

Tasmania

3.6

6.8

The effect then is that the New South Wales

Branch with over 40% of the members receives the maximum number of votes but although its membership

is more than

twice the membership

of the next biggest Branch it receives

only one more vote than that other Branch. Stated

in other

words, each vote

in New South Wales represents 2265 members,

in Victoria 1213, in Queensland 1067 members,

in South

Australia 679 members, in Western Australia 628 members and

in Tasmania 633 members. In addltion

of course the National

Secretary exercises one vote. There are

a total of 44 votes

able to be cast at National Council meetings. The objection

made is that such

a disparity makes the rule contrary to

s.2(e) and 2(f) of the Act, deprives the members of control

of the council contrary to regulation 115(l)(d)(v) and

imposes upon members conditlons, obligations or restrictions

which having regard to the objects of the Act and particularly

objects 2 (e) and

2 (f) are oppressive, unreasonable 'or

unpst.

Section 2(e) and

(f) set out objects

of the Act

but we are unable to see that rule

9 is in any way contrary

to these oblects. The objects are important but the Act

then provides methods by which they may be realised and

among those methods are the provisions for registration

of the organization and the powers given to the Court to

act under

s.140.

.	./12. .

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It is not possible we think to say that rule is contrary to the Act within the meaning of s.l40(l)(a)

because it may be regarded In some way as not completely in

accord with the objects of the Act set out In s.2(e) and (f).

It is not a case where the rule is one which prevents or hinders the achievement of the objects of the Act but

case where it is said that while the Act has as one of its

objects, for example, the encouragement of the democratic

, control of registered organizations, this organization

is not sufficiently democratically controlled. In those

circumstances the rule cannot be said to be contrary to the

Act for that reason.

In considermg the second ground of attack, that the rule does not provide for the control

of the committees

of the organization by its members, it is necessary to look

not only at this rule but at the rules generally. Provision

is made in the rules for elections at regular intervals; in

the case of the General Secretary and Assistant General I

Secretary, by secret ballot of all members;

in the case

other members of the National Executive by secret ballot

election by what may be termed

a "first-tier" college.

There is, moreover, provision for plebiscltes

in certain

cases. The Natlonal Council of.the organization has ultimate

control over the Natlonal Executive and in all the circumstances

we are satisfied that the rules provide sufficiently for the

control of committees of the organization by the members

thereof.

The third ground taken is that the rules impose upon members condltions, obligations and restrictions which

having regard to the objects of the Act are oppressive, unreasonable or unjust. The two objects particularly

referred to are those in s.2(e) and

(f).

Ne have already set out

a general view

of the

structure of the organizatlon. It is to be observed that

the particular relevancy of these two objects to this

. . / t 3 . .

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conslderation is that the questlon of oppression etc. is

to be determined having regard to the objects of the Act

and the purposes of the registratlon of organizations

under the Act.

The history of organizations under this Act flows from the commencement of the Act in

1904. At that

time there were many associations active throughout the Commonwealth. As a matter of history in the then economic development of the Commonwealth there were few federal

industries and not a great deal of interstate competition.

Distances were vast and means

of communication very

different from today. One finds then in the earliest

the organizations registered that they generally took the

form of somewhat loose federations of strong branches

where the bulk of the activity was spent on intra-State

matters. In many cases the offices in the federal

organization were honorary or at best part-time.

With the industrialisation of the Commonwealth

and the vast development in industry, many changes have

occurred with organizations and the Court has now virtually

a full spectrum

of organizations with which it is concerned.

They range from organizations which retain the picture of

there being strong branches and

a weak central body to

organizations which are the complete reverse and indeed

to some organizations where there may exist only

a central

federal body.

The existence of organizations is fundamental

.to the working of the Act. History has seen

a gradual

change in the requirements for registration and controls

by the Parliament to ensure the representative character

and the viability of organlzations. Over the years there

has been

a gradual movement culminating in the present

positlon where detailed legislation deals with such things

as elections, the control of the organization and the

structure of organizations.

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The Court in exercising its present Jurisdiction is concerned with all the objects of the Act and clearly it

is fundamental to those objects that there be not only

democratically controlled organizations but that these

organizations should be viable. In other words, we must

take care to ensure not only that democratic control is

encouraged but also that the organization remains viable.

This means that questions

of balance must arise. On the

one hand, the

ob-~ects

include the encouragement

democratic control but in having regard to that object

we clearly cannot dlsregard the need for the organizatxon

to be

a vxable one. It is

a feature common to federations

with component parts of different strength and sizes

that there must be

a system of checks and balances.

That of course is quite clearly illustrated in the

Constitution of the Commonwealth of Australia with its

provision for two House of Parllament in one of which the

component States have generally speaking equal numbers of

representatives and in the other of which regard is had

to the number of electors xn determining the number of

representatives. Like provisions are

a feature of

federations elsewhere.

The importance of this consideration is that

branches of organizations are probably necessarily of unequal

membership and of unequal strength. Industry and production

have developed at different rates and

in dlfferent ways

in the different States and generally speaklng there is

necessarily a greater number of workers available for

union membership in the larger States. Again, generally

speaking, branches of organizations conform with State

boundaries. They are generally defined by geographic

features although there are some organizations with

branches defined by the industry

or the occupation of its

members. In both cases

theEwill inevitably be branches

of different size. What we are concerned with is the

encouragement of democratlc control.

.	./15..

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It is not to be thought that this democratic

control is to be achieved

in one sweep. Our concern is to

see that it is encouraged.

So when considering the

reasonableness etc. of

a rule having regard to this object

we must consider It against this background. In

structure there seems no place for two pollcy making bodies

We know of no attempt which has been made to have two such

a union

bodies and the system of checks available between

a Senate

and a House of Representatives is not present here.

Nonetheless there clearly will exist fears

on the part

of smaller branches or workers in the smaller

State that if they join with

a federation they and their

members may be swamped by the larger branches.

To insist

then on types of rules where the democratic ideal of one

person one vote existed would in our view operate to prevent

viable national bodles being formed.

It is true that in some recently formed organizations the policy-making bodies have adopted

system of card vote where delegates from each branch

exercise a number of votes

in proportion to the number

of members in the branch. These are however exceptions

and very small exceptlons to the general rule and

It is

a feature that they are of recent formation and generally

with members either of one employer or

in one industry.

If the objects of the Act are seen to both encourage

viable organizations and to encourage the democratic control

of them, in determining the reasonableness of

a rule it is

necessary to look at what

is practicable even though it may

be something less than, for example,

a complete democracy.

The concept of encouraging the democratic control

was introduced in

1973 and in considering democratic control

it seems necessary to reach

a view as to the meaning

of the

.	./16..

- 16 -

words now rather than some other time. In the Commonwealth,

universal suffrage has been generally adopted. There are

no property qualiflcations,

a rlght to vote is glven at

18.

on the other hand the Goncept

of one vote one value has not- been

generally adopted and electorates of different sizes and

of different numerical strengths have the same number of

representatives. All these are regarded as consistent with

democracy or a democratic control. Nonetheless it is clear

that there has been a gradual movement to the concept of

one vote one value and

an abolition of qualiflcation based

on sex, property ownership and the

hke.

Our task as

we see it is to have regard to rules

and their reasonableness in the light of the manner they

affect democratic control and the manner they may affect

the viability of an organization. This is

a task to which

it is not possible to apply

a formula. It will be necessary

in many cases to look at the history

of the organization,

may cover, distances, problems of communication and the like.

to look at its compositlon and such factors as the area it factors, so there may well be disparities in the representatlon of branches based on particular factors.

The High Court

of Australia in Attorney-General

(at the Relation

of >lcKlnlav) v. The Commonwealth

of Australia

135 C.L.R. 1 considered somewhat

hke questions in decidlng

the validlty of leglslation based on

s.24 of the Constltutlon

and its use of the words "directly chosen by people

of the

Commonwealth". This was held to require representative

democracy whi& is not unllke the concept shown in the

objects of this Act of an organizatlon democratically

controlled with full participation by its members. In

I '

discussing representative democracy, Stephen

J. at p.57 said

"It ls, then, quite apparent that representative

democracy 1s descriptive of

a whole spectrum of

political instltutions, each differlng In count-

less respects yet answering to that generlc

description. The spectrum has flnite llmits and in a particular instance there may be

absent some quallty 1;hich

is regarded as

./17..

- -

- - - ---

- 17 -

essential to representatlve

democracy as

place that

instance outslde

those llmits

alk;.clge$hw: but at no one

pomt withln

the range of the spectrum does there exist

any single requlrement

so essential as to be

determmative of the existence of representative

democracy.

To contend that the presence

of what is descrlbed

as 'as near as practicable equallty of numbers'

wxthin electoral divlslons is essential to repre-

sentatlve democracy, to

a legislature 'chosen by

the people', is to deny proper meaning to language

and to ignore long chapters

in the evolution of

democratic lnstitutions both in this country and

overseas, in which, representatlve democracy havlng

been attained, Its details have undergone frequent

changes in response to community pressures but have

failed to

possess this

feature of equality of numbers

on which the plamtiffs now insist.

It is no doubt true that something approaching

numerical equallty of electors

within electorates

is an important factor, together with much else,

in the attainment

of what many will regard as

representative democracy in its purest form, Just

as adult suffrage, free of dlscrxmlnation on the

grounds of race, sex, property or educatlonal	I
qualification 11x11 likevrise~ aid In its attainment.

But neither

of these in absolute form

1 s necessarily

imported into the Constitution by the selectlon of

representative democracy as the chosen mode of

government for the nation."

and at p.61 said further:

"It is perhaps conceivable that variations in the

numbers of electors or people in single member

electorates could become

so grossly dispfoportlonate

as to raise

a question whether an election held on

boundaries so drawn would produce

a House of

Representatives composed of members dlrectly chosen

by the people of the Commonwealth, but thls is

matter quite removed from the proposition that

s.24 insists upon

a practical equality of people

or electors in slngle member electorates."

See also per McTiernan and Jacobs JJ. at p.35-6 and Mason J. at p.61-2.

When one comes to consider the present organizatlon

it may be said at once that xf the rules provided for

an equal

representation from each branch that would mean that -the

smaller branches dominated the larger and such rules would

in our vlew not encourage democratic control and would be

. .

/16.

- . - .

. ..

- -. -

c. '

- 18 -

unreasonable. On the other hand if the rules provided for

votes in strict accord with membership then

in our view

the smaller branches would feel swamped by the larger and

the organization mlght well cease to exist or be vlable.

Some balance between these two extremes

1 s necessary.

However the present rule in our view does offend against the Act. It does provide for

a scale of voting but

the scale is loaded too heavily

in favoqr of the smaller

branches. This is particularly

so when this is allied with

a limitation on the total number

of votes which

a branch

may have. Moreover, the scale provided for voting provides two votes for the first 1,000 members and one additional vote

for the next two groups

of 1,000 members. There is then an

extra vote for the next

two groups of 500 members. The scale

then proceeds allowing an extra vote for each

2,500 members

but allows only one extra vote for all members over

11,500

although the New South Wales Branch has

a membershlp

virtually double the number

on the scale which entitles

it to 10 votes.

We think the rule is unreasonable

in the

numbers of members required for additional votes in that

these start at

1,000 then drop to

500 then increase to

2,500 and reach the maximum number at

11,501 members. The

disparity between the number of members for whom

a branch

has a vote is too uneven and is

too great. We think a

more even scale could properly be adopted.

This view we think is consistent with.the

earlier cases (see McKenzie

v. Administrative and Clerical

Officers Association

5 F.L.R.

342 partlcularly at

348, and

Crealy v. Commonwealth Bank Officers Assocj-

1 F.L.R.

153)

in so far as they discuss the domination by smaller branches

over the larger branches.

It should be noted that these two cases were

decided when the oblects of the Act did not include the

object set out in

(f) of s.2.

The principles flow from

the requlrement to encourage the organization of representative

.	./19..

. .

- 19 -

bodies of employees. Since the

1973 amendment we think

that the considerably added emphasis has been given to the

o'bject of encouraging the democratic control of organizations

and the full participation by members in the affairs of the

organization. Since the additlonal object the question has

been considered by Sweeney

J. in Luckrnan v. Australian

Postal and Telecommunications Union,

10 October, 1978,

unreported. All these factors in our view give added

emphasis to the opinion already expressed that the present

rule offends against the Act.

We think it is not for the Court to impose

its rules on organizations. Its duty is rather one to

intervene if rules offend against the Act and we think

it would be wrong for us to attempt to draw	a rule for
the organization.

The E.T.U.

rule making body must know its

branches and the particular

circumstances when one rule

rather than another is appropriate and we think it preferable

to leave to it the actual devising

of a rule whlch will fall

more properly within the extremes we have mentioned.

A question then arises as to the order which is

I	appropriate.

Thls rule appears to have been

a rule of

the

organization for some tlme and to have been acted on without

complaint until quite recently. In those circumstances

we think if we took the course of making

a declaration

'that the particular rule contravened the Act it would have

unfair consequences to the organizatxon. There being

here no suggestion that the organization has acted other

than bona fide we think the appropriate course to take is

to adjourn the proceedings pursuant to

s.140(6) for the

purpose of giving the E.T.U. an opportunity to alter its

rule. The rule making authorlty is the National cbuncil

and we think that an adJournrr.ent for

a period of three

months would be sufficient to allow the National Council

to make appropriate

alterations to the rules.

.	./20..

- 70 -

We propose then that the proceedings

adjourned pursuant to

s.l40(6) to allow the E.T.U. an

opportunity of altering its rules.

Liberty to apply will

be given to any party to apply on seven days notice

to the

Court and to other parties.

The applications under s.lP.1

and s.171C will stand over to the same date.

I m

TIIE FEDERAL COURT OF AUSTRALIA

KO. 22 of 1978

INDUSTRIAL DIVISION

NEW SOUTH WALES DISTRICT REGISTRY

--	RE'DEEN: DAVID MC LEISH

Claimant

Respondents

O R D E R

JUDGES MAKIRG ORDER: J.B.

SWEENEY, PHILLIP WATT and NORTHROP JJ.

I I

DATE OF Ol??ER:l4 November 1978	i I
I
WHERE MADE: Sydney
i

THE COURT ORDERS

THAT:

The matter

stand adjourned

to 13

February

1979.

L ibe r ty t o

any

par ty

apply

days not ice to the Court

and

t o o t h e r

p a r t i e s .

IN THE FEDERAL COURT OF AUSTRALIA

)

No. 24 of 1978

INDUSTRIAL DIVISION	\
I

NEW SOUm WALES DISTRICT REGISTRY

)

BETWEEN: N.D.

I(ANE, G .C. COLTHORPE

C.J. EMERY, C.W. FAURE,

'	I. AUCHTERLONIE, E.J. TURNRULL
K.B. GILBERT. S.D. ALLEN,
T.D. RITT, J.R. DEVEREUX,
M.A. WALKER and C.O. DOLLV

Applicants

AND:

DAVID McLEISH,

J.E. O'SRIEN,

M.G.H. PITT, R.M. GLASTOXBURY,

D.I. CHRISTII\IUSEN, F.D. DRICZ

Respondents

O R D E R

JUDGES M??ING ORDER: J.B.

SWEENEY, PHILLIP EVATT and NORTHROP

JJ.

DATE OF ORDER:

14 November 1978

WHERE

MADE:

Sydney

THE COURT ORDERS

THAT:

The matter stand adjourned to

13 February 1979. Liberty

to any party

to apply on

7 days notice

to the Court and

to other parties.

. . _.

- ._

- _ _ _ .- -- . ----.

.---

-.-.-.--.--------

-- -

. ..

I N THE

FEDERAL

COURT OF

AUSTRALIA

)

INDUSTRIAL

DIVISION

NEW SOUTH WALES DISTRICT

REGISTRY

I N THE NATTER of

the C o n c i l i a t i o n

and A r b l t r a t i o n A c t

1904

AND I N THE MATTER of an application

pursuant t o Sectlon 140 and Sectlon

141 of the said A c t .

BETWEEN :

DAVID MC

L E I S H

C l a i m a n t

N.D.

KANE,

G.C.

COLTHORPE,

G . J .

EMERY, C.W.

FAURE,

I. AUCHTERLOXIA, E . J. TURKB1

J . E .

O ' B R I E X ,

G . E .

P I T T ,

R .M. GLASTOXBURY , D. I -

CHRISTIANSEN ,

F .D. PRICE,

GILBERT,

S.D.

ALLEX,

T.D.

RYST,

J .R.

DEVEREUX,

M.A.

WALKER and C. 0 . DOL-XL

Respondents

(No. 22 of 1978)

AND IF7 THE MATTER of an application

pursuant t o Sectlon 1 7 1 C of	the
said A c t .
BETWEEN :

N.D.

KANE,

COLTHORPE,

C . J .

EMERY,

C.W.

FAURE,

I. AUCHTERLONIE , E .J. TUFWBLJLI,,

K.B.

GILBERT,

S.D.

ALLEN,

T.D.

RYNTi,

J . R .

DEVEREUX,

M.A.

WALKER

and

C -0.

DOLKN

A p p l i c a n t s

AND:

DAVID

MCLEISH,

J.E.

O ' R R I E N ,

M.G .H. PITT, R.M.

GLASTONBURY,

D. I . CRRISTIANSEN , F. D -

PRICE

R e s p o n d e n t s

( N o . 2 4

1978)

. :

. ..

- 3 -

Those challenged are rules 9(a) and

(a), part

of rule

1.0, rule 13 and rule 20. Rula; 9(a)and (d) are challenged

as being contrary to regulation 115(l)(d)(v), as being

contrary to s.2(e) and

(f), being two of the objects of

the Act and as imposing upon members condltions, obligations

or restrictions which having regard to the objects	of the
Act are oppressive, unreasonable or unjust.

Rule 10 it is said, having regard to the objects

of the Act, is so obscure and vague as to be meaningless and hence is oppressive or unreasonable. It is further

claimed that since it makes provision for

a plebiscite

and there

is no manner

in which given number or proportion

of members as distinct from branches may obtain

a plebiscite,

the rules do not provide for control

of committees and the

rules are contrary to regulation

115(l)(d)(v).

Rules 13 and 20 are both attacked

as imposing

upon members conditions which having regard to the objects

of the Act and the purposes of registration	of organizations
are oppressive, unreasonable or unjust.

Orders Nisi were granted in the application under s.140 and s.141 and on the directions hearing then fixed,

both parties made application under

s.118c that the proceedings

be heard and determined by	a Full Court and an order to this
effect was then made.

Before considering the rules in detail,

it is

desirable m look briefly at the structure of the organizatlon. It has been registered for many years and has six branches throughout the Commonwealth. These branches appear to be

one in each State

of the Commonwealth. Members In the

Australian Capital Territory are attached to the New South

Wales Branch and members

in the Northern Territory are

attached to the Queensland Branch. The branches each elect

officers and committees and admit members and collect contrib-

utions from them. Eighty-seven and

a half per cent

of the

- 4 -

moneys collected are retained by the branches and it is

clear that they are strong and viable units

of organlzation

within the E.T.U. The bulk of the officers are elected by

branches and having regard to the division of funds.it would

seem that the majority of the activities

of the E.T.U. are

in fact carried out by branches.

The rules secure to the branch important activitles

and a real degree of autonomy. In the

E.T.U. federally, there

exists a National Council which consists of the General Secretary

and delegates elected by each branch. The delegates elected

are

one

from

a branch

not

exceeding

1,500

members,

three

. ,

delegates from

a branch exceeding

1,500 but not exceeding

7,999 members and the rules then provide that

a branch

with a membership of

8,000 or over may send four delegates.

Delegates then have

a right to exercise votes according to

the membership

in the branches and this is provi’ded in the

following table as set out in r.9(d).

1 - 1000 members

2 votes

1001 - 2000 members	..	3 votes
2001 - 3000 members	..	4 votes
3001 - 3500 members	..	5 votes
3501 - 4000 members	..	6 votes

4001 - 6500 members	..	7 votes
6501 - 9000 members	..	8 votes
9001 - 11500 members	..	9 votes

11501 members and over

10 votes

In addition, the National Secretary has

a right

to exercise one vote. In cases where delegates are entitled

to exercise

a number of votes greater than their

number as

in, for example, the case

of New South Wales where three

delegates exercise ten votes, it does not appear

how these

votes are to be exercised whether by direction of the branch,

decision of the majority of delegates or by each delegate

exercising some

of the votes in the proportion the number

of delegates bears to the number

of votes to

be exercised.

- 5 -

The absence of such provision does not affect our view

to the rules but in the light of the fact that

it will

not

necessarily be the case

t'nat all members

of the branch

support a particular view or indeed that all delegates

support a particular view it

is, we think,

a provision

which might usefully be made.

The

National Council

meets annually and there

is provision for special meetings

of it to be called.

The annual meeting

of the National

Council is referred to in the rules as the National Conference.

The rules provide for the election

of the

National Secretary and the National Assistant Secretary

by ballot of the financial members and for

the election

of the National President and National Vice-President

by the National Council.

In addition

to the National Council, there is

a National Executive

of 9 members comprising the National

President, National Vice President and National Secretary and either one or two branch representatives. Each State

branch is entitled to one representative on the National Executive but if the National President and National Vice

President are members of

a particular branch they are deemed

-	to represent that branch on the National Executive and in
that circumstance the particular branches will be entitled
to two representatives on the National Executive.

In addition to the National Executive,

National Executive Committee consisting

of the President,

Vice President and National Secretary is established. The

National Executive meets between meetings of the National

Council and may be convened by the National Secretary

and President while the National Executive Committee

meets to deal with urgent matters between meetings of the

National Executive.

./G..

- 6 -

First we consider rule portion of this rule which is attacked is as follows

10. The particular

"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 flnancial

members on any question

as provided by Rule

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

a d all officers and members of the Unlon."

Sub-rule lO(a) provides:

' I . . .

the National Council shall act in all the matters

referred to it by

a Branch and shall decide in all

I	cases for Xvhlch no provislon is made in these Rules, and shall have the general control and conduct of

.	the business and affalrs of the Union. The actions

and decislons of the National Council shall be flnal

unless negatived,

as provided in

Rule 20, or other-

w i s e dealt with by

a malority of members

of the Union

by a referendum or by

a special conference."

Sub-rule 10(b) provldes that, 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"

and (12):

"To submit any matter to the members for decision

by ballot".

Rule 20 is headed "Limiting Action of National Council or National Executive" and provides:

"Decisions of Natlonal Council and/or National

Executive shall be implemented by Branches unless

a resolution for the purpose

of directing or

limiting any action taken

or about to be taken

is carried by any

'CWO Branches at specially

summoned State Councll Meetings held within

forty-two days of the Natlonal Secretary

notifylng the Branches of such National Council

or National Executive declsion."

The rule further provides that the President

upon receiving notice of

a resolution is to issue lnstructions

restraining the National Secretary from proceeding until

./7..

- 7 -

"the resolution passed by the two Branches referred to shall have been submitzed to and considered by the whole of the Branches of the Union and in the

eyent of a majority of members present at specially

summoned State Councll Meetings

in a maJorlty of the

Branches upholding the objection referred

to, no

further action shall be taken by the National

Council or Executive until

rhe next National Council

Meeting" .

Rule 10, then, provides for

a referendum "as

provided by Rule

20" and provides for the decisions of the

National Council to be final unless negatived as provided

in Rule

20 or otherwise dealt with by referendum or

special conference.

Two constructions of rule

10 were urged upon us.

The first was that where first used in rule

10, the words

"as provided by Rule20" qualified the word "demand". The

effect was then that the demand for

a ballot of financial

members had to be made as provlded in rule

20, i.e. by two

Branches at specially surmnoned State Council Meetings.

The second submission was that rule

10 dealt

with ballots of financial members "as provided by Rule

20"

but that since rule

20 dealt only with demands by specially

summoned State Council Meetings and resolutions carried by

the members of the State Councils, the phrase had no clear

application when used In rule

10 and left the rule

obscure and meaningless as to be unreasonable etc. as

referred to in s.l40(l)(c). It was also claimed that

since the only provision for

a vote was for

a vote among

members of State Councils

of Branches, the rules did not

sufficiently provide for control of committees by the

members as required by regulation

115(l)(d)(v).

The rules are not easy to interpret and no doubt

have grown over the years with changing emphasis on particular

provisions. We think, however, that

~f such an interpretatlon

is fairly open they should be construed to give

a rule a

-	meaning rather than holding it meaningless with no effect

at all.

.f8..

- 8 -

On this basis we regard the words "as provided by Rule 20" where first appearing in rule

10 as qualifying

the w3rd "demand". On this basis the rule would provide

for a referendum of members on particular issues when this

was demanded by any two Branches at specially summoned

State Council Pketings of those Branches. When such

a demand

is made it is the duty of the National Secretary forthwith

to hold such

a ballot and in our view,

in addition to

holding tne ballot, his duty is to submit the resolution

of the two State Branches to the other State Branches concerned

to allow them to take action under rule

20. If action were

taken by the Branches under rule

20 the results would be as

follows

_ . On the resolution by two branches at specially

summoned meetings of their State Councils within

42 days of the resolution the declsion of the

National Executive could not then be implemented until the questlon of its implementation had been

submitted to the other branches. If

a majority

of the members present at State Council Meetlngs

in a majority of branches

so resolved the declslon

of the National Council would not be further

implemented until the next National Council meetlng.

The two branches by their State Councils could also carry a resolution requirlng-a referendum of all

members and if this were done it would be

a demand

within the meaning of rule

10 and the National

Secretary would then be obliged to proceed to hold the ballot of all flnancial members. There are no

detailed provlsions for the holding of such

a ballot

but it is clearly the duty of the Secretary to hold

the ballot and to use his discretion as to.the

manner of holding it providing the dlscretlon is

exercised bona fide and in

a reasonable manner.

So interpreted the rule

is not vague or

obscure as to be unworkable and it does not in our view

offend against any

of the provisions of

s.140. The holding

of a referendum is

a cumbrous and expensive action for any

union to take and it seems to us entirely reasonable in the

case of this Union and its rules that it should benecessary for it tc

be taken only if two or more branches by their State Councils

. so resolve.

. / g .

l I

. .

- 9 -

On the interpretation we have given to rule

it is clearly operative and not

so obscure as to offend against

s.140.

As we have said, the taking of

a referendum of all

financial members

is an

expensive undertaking. The Union

has some 40,000 members and taking of a referendum for the printing of

it would be necessary

in the

a ballot paper,

for the provision of some statement of cases for and against

and for the despatch of

a ballot paper by post. In addition,

it would be necessary for

a return envelope to be enclosed

and for postage

on this to be paid by the organization. The

holding of

a referendum then is no light matter and

we think

that the requirement that

it should be sought by not less

than two Branches is entirely reasonable. If

a group of

members desires

a referendum we think it reasonable that

it should have the support of at least two Branches and

w e

do not regard such

a requirement having regard to the objects

of the Act and the purposes of the registratlon of organizations

under Yne Act as oppressive, unreasonable

or unjust. It

follows then that rule

20 is, as is the case

\nth rule 10,

in our view not successfully challenged.

Rule 13 provides for a National Executive. It

is an administrative body which meets between meetings of

the Natlonal Council and which exercises its powers subject

to the overriding control of National Council. Any decision

of the National Executive may be held up and prevented

from taking effect by the procedure provided under rule

20.

A special meeting of the Natlonal Council may be called by

the National Secretary and President or

as the NationalCouncll or

National Executive may determine. The National Executive

is primarily an administrative body. It is necessary

for it to be a small body that it may function and secondly it seems clearly necessary that each Branch should be

represented

it.

Havlng

regard

the

power

in rule 20

to ensure a moratorium in respect of any action and having

regard

the

overriding

power

National

Council,

think rule

13 is not unreasonable, oppressive

01 unjust.

./10. -

It is true that smaller Branches have the same voting power as do large Branches but we think that taking into account its administrative functions, the need for such Branch to

be represented

on it and to the overriding powers of the

National Council rule

13 having regard to the objects of the

Act and the purposes of the registration of organizations under the Act is not oppressive, unreasonable or unjust.

We turn then to rule

9 on which the major attack

was made.

It establishes the National Council of the

organization and while the number of delegates is limited

to a maximum of four from

a Branch, delegates have voting

rights in accordance with rule

9(d).

On the evidence, New South Wales is and has been

for a number of years the biggest Branch. Its membership

has ranged from

48% of the total members to 43%. The next

biggest Branch is the Victorian Branch and the other Branches

then have lesser numbers.

Provision is made as already stated in rule 9(d)

for the exercise of votes according to the scale there set out.

The effect is shown by the following table. It should be

added that the calculation cf the membership here is done

by applying a formula which is set out in the rules. By

this formula the amount of contrj.butions and entrance fees

received is divided by the annual contribution fee for adult

tradesmen. The effect of this is that since there are

each Branch entrance fees and there may be received

in any

one year arrears of contrjbutlons the figures do rot reflect

the exact number oi members but they clearly show the

relative position as between Branches. The table is as

follows :

Votes

Kembers

New South Wales

22656

Victoria

10921

Queensland	8536	8
South Australla	4753	7
Western Australia	3766	6
Tasmania	1899	3
National Secretary	1

- 11 -

The evidence further showed that, comparing

the membership ascertalned in the same way, the

percentage of membership and percentage of votes each

branch received, are as appears in the following table:

% of Membership % of VoEes

New South Wales	43.1	22.7	. ,
Victoria	20.7	20.4
Queensland	16.3	18.1

South Australia	9.0	15.9
Western Australia	7.1	13.6

Tasmania

3.6

6.8

The effect then is that the New South Wales

Branch with over 40% of the members receives the maximum number of votes but although its membership is more than

twice the membership

of the next biggest Branch it receives

only one more vote than that other Branch. Stated

in other

words, each vote

in New South Wales represents 2265 members,

in Victoria 1213,

in Queensland 1067 members, in South

Australia 679 members, in Western Australia 628 members and

in Tasmania 633 members. Secretary exercises one vote. There are

In addition of course the National

a total of 44 votes

able to be cast at National Council meetings. The objection

made is that such

a disparity makes the rule contrary to

s.Z(e) and 2(f) of the Act, deprives the members of control

of the council contrary to regulation 115(l)(d)(v) and

imposes upon members conditions, obligatlons or restrictions

which having regard to the objects

of the Act and particularly

objects 2 (e) and

2 (f) are ogpressive, unreasonable or unjust.

Section 2(e) and

( f ) set out objects

of the Acc

but we are unable to see that rule

9 is in any way contrary

to these objects. The

ob~ects

are important but the Act

then provides methods by which they may be realised and

among those methods are the provisions for registration

of the organizatlon and the powers given to the Court to

act under

s.140.

./12. .

- 12 -

It is not possible we think to say that rule is contrary to the Act within the meaning of

s.140 (1)

(a)

because it may be regarded In some way as not completely in

accord with the objects

of fhe Act set out in s.2(e) and

(f).

It is not a case where the rule is one which prevents or hinders the achievement of the objects

of the Act but

case where it is said that while the Act has as one of its

objects, for example, the encouragement of the democratic

, control of registered organlzaticns, this organization

is not sufficiently democratlcally controlled. In those

circumstances the rule cannot be said to be contrary to the

Act for that reason.

In considering the second ground of attack, that

the rule does not provide for the control

of the committees

of the organization by its members, it is necessary to

look

not only at this rule but at the rules generally. Provision

is made in the rules

for elections at regular intervals; in

the case of the General Secretary and Assistant General

Secretary, by secret ballot of all members:

in the case of

other members of the National Executive by secret ballot

election by what may be termed

a "first-tier" college.

There is, moreover, provlsion for plebiscites in certain

cases. The National Council of.the organization has ultimate

control over the National Executive and in all the circumstances

we are satisfied that the rules provide sufficlently for the

I	control of committees	of the organization by the members
thereof.

The third ground taken is that

t'ne rules impose

upon members conditions, obligations and restrictions which

.	having regard to the objects	of the Act are oppressive,
unreasonable or unjust. The	two objects particularly

referred to are those in s.2(e) and

(f).

We have already set out

a general view

of the

structure of the organizatlon. It is to be observed that

the particular relevancy of these

two objects to this

. . p 3 . .

I l

- 13 -

consideration is that the question of oppression etc. is

to be determined having regard to the objects

of the Act

and the purposes of the registration of organizations

under the Act.

The history of organizations under this Act

flows from the commencement

of the Act in 1904.

At that

time there were many associations active throughout the

Commonwealth.

A s a matter of history in the then economic

development of the Commonwealth tbere were

few federal

industries and not

a great deal of interstate competition.

Distances were vast and means

of communication very

different from today. One finds then

in the earliest

the organizations registered that they generally took the

form of somewhat loose federations

of strong branches

where the bulk

of the activity was spent

on intra-State

matters. In many cases the offices

in the federal

organlzation were.honorary or

at best part-time.

With the industrialisation

of the Commonwealth

and the vast development

in industry, many changes have

occurred with organizations and the Court has now virtually

a full spectrum of Organizations wlth which it is concerned.

They range from organizations which retain

t'ne picture of

there being strong branches and

a weak central body to

organizations which are the complete reverse and indeed

to some organizations where there may exist only	a central
federal body.

The existence

of organlzations is fundamental

eo the working of the Act. History has seen

a gradual

change in the requirements for registration and controls

by the Parliament to ensure the representative character

and the viability of organizatlons. Over the years there

has been

a gradual movement culminating in the present

position where detailed legislation deals with such things as elections, the control of the organization and the structure of Organizations.

- 14 -

The Court in exercising its present jurisdiction

is concerned with all the objects of the Act and clearly it

is fundamental to those objects that there be not only

democratically controlled organizations but that these

organizations should be viable. In other words, we must

take care to ensure not only that democratic control is

encouraged but also that the organization remains viable.

This means that questions of balance must arise. On the

one hand, the objects include the encouragement

democratic control but

in having regard to that object

we clearly cannot disregard the need for the organlzation

to be a viable one. It is

a feature common to federations

with component parts

of different strength and sizes

that there must be a system of checks and balances. That of course is quite clearly illustrated in the Constitution of the Commonwealth of Australia with its

provision for two House o€ Parllament in one of which the

component States have generally speaking equal numbers of

representatives and

in the other

of which regard is had

to the number

of electors in determining the number of

representatives. Like provisions are	a feature of
federations elsewhere.

The importance

of this consideration is that

branches of Organizations are probably necessarily of unequal

membership and of unequal strength. Industry and

production

have developed at different rates and

in different ways

in the different States and generally speaking there is

necessarily a greater number

of workers

available for

union membership in the larger States. Again, generally

speaking, branches of organizations conform with State

boundaries. They are generally defined by geographic

features although there are some organizations with

branches defined by the industry or the occupation of its

members. In both cases theEwill inevitably be branches

of different size. What w e are concerned with is the

encouragement of democratic control.

.	./15..

. *

- 15 -

It is not to be thought that this democratic control is to be achieved in one sweep. Our concern is to

see that it is encouraged.

So when consldering the

reasonableness etc. of

a rule having regard to this object

we must consider it against this background.

In a union

structure there seems no place for two policy making bodies.

We know of no attempt which has been made to have two such

bodies and the system of checks axrailable between

a Senate

and a House of Representatives is not present here.

Nonetheless there clearly will exist fears

on the part

of smaller branches or workers in the smaller

State that if they join with

a federation they and their

members may be swamped by the larger branches.

To insist

then on types

of rules where the democratic ideal

of one

person one vote existed would in our view operate to prevent

viable national bodies being formed.

It is true that in some recently formed

organizations the policy-making bodies have adopted

system of card vote where delegates from each branch

exercise a number of votes

in proportion to the number

of members in the branch. These are however exceptions

and very small exceptions to the general rule and it is

a feature tinat they are

of recent formation and generally

with members either of one employer or in one industry.

If the objects of the Act are seen to both encourage

viable organizations and to encourage the democratic control

of them, in determining the reasonableness of

a rule it

necessary to

look at what

is practicable even though it may

be something

less than, for example,

a complete democracy.

The concept of encouraging the democratic control

was introduced

in 1973 and in considering democratjc control

it seems necessary to reach

a view as to the meaning

of the

.	./16..

- 16 -

words now rather than some other time. In the Commonwealth,

universal suffrage has been generally adopted. There are

no property qualifications, a right to vote is given at

18.

On the otherhand the Goncept of one vote one value has not been generally adopted and electorates of different sizes and

of different numerical strengths have the same number of

representatives. All these are regarded

as consistent with

democracy or a democratic control. Nonetheless it is clear

that there has been a gradual movement

to the concept of

one vote one value and

an abolition of qualification based

on sex, property ownership and the like,

Our task as

we see it is

to have regard to rules

and their reasonableness in the llght of the manner they

affect democratic control and the manner they may affect

the viability of an organization. This is a task to which

it is not possible to apply a formula. It will be necessary

in many cases to look at the history

of the organization,

to look at its composition and such factors as the area it may cover, distances, problems of communication and the like. Just as disparities in electorates are allowed for particular factors, so there may well be disparitles in the representation

of branches based on partlcular factors.

The High Court of Australia in Attorney-General

(at the Relation

of McKinlav) v. The Commonwealth

of Australia

135 C.L.R. 1 consldered somewhat

llke questions in deciding

the validity of legislation based on

s.24 of the Constitutlon

and its use of the words "dlrectly chosen by people of the

Commonwealth"

This was held to requlre representative

democracy w3i d~ is not unllke the concept shown in the

objects of this Act of an organizatlon democratlcally

controlled with full participation by its members. In

discussing representative democracy, Stephen

J. at p.57 said

"It is, thm, quite apparent that representative

democracy is descriptive of

a whole spectrum of

political. lnstltutlons, each differing In count-

less rcspects yet answering to that generic

deezrlptlon. The spectrum has flnite llmlts

and in a particular instance there may be

absent some

quahty r,hich 1 s regarded as

I - -

- 17 -

e s s e n t i a l t o r e p r e s e n t a t i v e

democracy

t o

place tha t lns tance ob ts ide those

limlts

&imge$lEr:

b u t a t

no one point

within

the

range

the

spectrum

does

there

e x i s t

'any single requirement

e s s e n t i a l

t o be

determinative	of	the exls tence of representacive
'democracy.

To contend that

the presence of what is described

a s

'as

near

pract icable equal l ty of

numbers'

wi th in e l ec to ra l d iv i s ions

e s s e n t i a l t o

repre-

sen ta t ive democracy,

t o a leg3.slature

'chosen by

the people ' ,

i s t o deny proper meaning t o languzge

and

to ignore long chapters in the evolu t ion

democrat ic inst l tut ions both In this country

and

overseas,

which,

representat lve

democracy having

been

a t t a i n e d ,

Its d e t a i l s have undergone

frequent

changes In response to

community

pressures but have

f a i l e d t o p o s s e s s t h i s f e a t u r e o f e q u a l i t y

numbers

which

t h e p l a m t i f f s

now

i n s i s t .

doubt true thac something approaching

numerical equality

e l ec to r s w i th ln e l ec to ra t e s

is an important factor , together

with

much

e l s e ,

in the a t ta inment o f

what

many

1n11

regard as

representat ive democracy i n i ts purest form,

j u s t

adu l t

su f f r age ,

free of

discrlmination on rhe

grounds

race, sex, property or educat ional

qua l i f i ca t ion

in11

l ikewise!

aid

i n i ts

attainment.

But

nei ther of

these

in abso lu t e

form is necessar i ly

imported into the Const i tut ion

the s e l ec t ion

representat ive democracy as the chosen

mode of

government

fo r t he na t ion . "

and

a t p.61

sa id fu r the r :

"It

perhaps conce ivable tha t var ia t ions in the

numbers

e l ec to r s o r peop le i n s ing le

member

e lec tora tes could

become

grossly disproportionate

a s t o r a i s e

question whether an election held

boundarles so drawn would produce a House of

Representatives composed of members direct ly chosen

the people of the

Cormonwealth,

b u t t h i s

mat ter qui te

removed

from

Yne

propos i t lon tha t

s.24

insists upon

p rac t l ca l equa l i ty

of people

o r e l e c t o r s i n s i n g l e

member

e lec tora tes . "

See also per McTiernan and	Jacobs JJ.	a t p.35-6 and	Mason J.
a t p.61-2.

when

one

ccmes

to conslder the present organlzat lon

it may be s a i d

a t

once t h a t i f the r u l e s provided

for

W equal

reprcsentation

from each branch

t h a t would mean

t h a t t h e

smaller branches

dominated

thc

larger

and

such

r u l e s would

i n nlllp view not P n r w : r - = , 7 e d-mn-l-,-tir

coni-rnl

-nd \qn111 cl

1s.

- 18 -

unreasonable. On the other hand if the rules provided for

votes in strict accord with membership then

in our view

the smaller branches

wokd feel swamped by the larger and

the organization might well cease to exist or be viable. Some balance between these two extremes is necessary.

However the present rule in our view does offend against the Act. It does provide for

a scale of voting but

the scale is loaded too heavily in favour

of the smaller

branches. This is particularly

so when this is allied with

a limitation on the total number of votes which

a branch

may have. Moreover, the scale provided- for voting provides two votes for the flrst 1,000 members and one additional vote

for the next two groups of

1,000 members. There is then an

extra vote for the next two groups

of 500 members. The scale

then proceeds allowing an extra vote for each

2,500 members

but allows only one extra vote for all members over

11,500

although the

New South Wales Branch

has a membership

virtually double the number on the scale which entitles

it to 10 votes.

We think the rule is unreasonable

t h e

numbers of members required for additional votes in that

these start at

1,000 then drop to

500 then increase

2,500 and reach the maximum number at

11,501 members. The

disparity between the number of members for whom

a branch

has a vote is too uneven and is too great. We think	a
more even scale could properly be adopted.

This view we think is consistent with. the

earlier cases (see McItenzie

v. Administrative and Clerlcal

Officers Pssociatlon

5 F.L.R.

342 particularly at 348, and

Crealy v. Commonwealth Bank Officers Asso-

1 F.L.R.

153)

in so far as they discuss the	domination by smaller branches
over the larger branches.

It should be noted that these two cases were

decided when the objects

of the Act did not include the

object set out in (f)

of s.2.

The princlples flow from

the requirement to encourage the organization of representative

.	./19..

. -.

- 19 -

bodies of employees. Since the

1973 amendment we think

that the considerably added emphasls

has been given to the

o'bject of encouraglng the democratic control of organizations

and the full participation by members in the affairs of the

organization. Since the additional object the question has

been considered by Sweeney

J. in Lucl-xnan v. Australian

Postal and Telecommunlcations Union,

10 October, 1978,

unreported. All these factors in our view give added

emphasis to the oplnion already expressed that the present

rule of5ends against the Act.

We think

its rules on organizations. Its duty is rather one to

intervene if rules offend against the Act and we think

it is

not for the Court to impose

it would be wrong for us to attempt to draw	a rule for
the organization.

The E.T.U. rule making body must know its

branches and the particular circumstances when one rule

rather than another is appropriate and we think it preferable

to leave to it the actual devlsing of

a rule which will fall

more properly within the extremes

we have mentioned.

A question then arlses as to the order which is

appropriate.

This rule appears to have been

a rule pf the

organization for some tlme and to have been acted on without

complaint until quite recently. In those circumstances

we think if we took the course of making

a declaration

'that the particular rule contravened the Act it would have

unfair consequences to the Organization. There being

here no suggestlon that the organization has acted other

than bona fide we think the appropriate course to take is

to adjourn the proceedings pursuant to

s.140(6) for the

purpose of glving the E-T.U. an opportunity

CO alter its

rule.

The rule making authorlty

1 s the National cbuncil

and we think that an ad-jourment for

a period of three

months would be sufficient to allow the National Council

to make appropriate alterations to the rules.

./20..

- 20 -

propose then that the proceedings be

adjourned pursuant to s.140(6) to allow the E.T.U.

opportunity of altering its rules. Liberty to apply will

be given to any party to apply on seven days notice to the

Court and to other parties.

The applications under s.141

and s.111C will stand over to the same date.

[1978] FCA 97

14 Nov 1978