Public Service Association of South Australia v Federated Clerks Union of Australia South Australia Branch

[1991] HCATrans 33

~	.;,, AUSTRALIA ..:-
-->>~~~~f*-:_(..~

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Adelaide No A25 of 1990

B e t w e e n -

PUBLIC SERVICE ASSOCIATION OF

SOUTH AUSTRALIA

Appellant

and

FEDERATED CLERKS UNION OF

AUSTRALIA SOUTH AUSTRALIAN

BRANCH and AUSTRALIAN SOCIAL

WELFARE UNION SOUTH AUSTRALIAN

BRANCH

Respondents

BRENNAN J
DEANE J
DAWSON J
GAUDRON J

McHUGH J

TRANSCRIPT OF PROCEEDINGS

AT CANBERRA ON THURSDAY, 7 FEBRUARY 1991, AT 2.22 PM

Copyright in the High Court of Australia

Clerks(2) 1 7/2/91

MR D.J. BLEBY, QC:  May it please the Court, I appear with

my learned friend, MR P.N. MOLONEY, for the

appellant. (instructed by Moloney and Partners)

MR R.C. KENZIE, QC:  May it please the Court, I appear with

my learned friend, MR P.A. HEYWOOD-SMITH, for the

first respondent. (instructed by Johnston Withers)

MR s. ROTHMAN:  May it please the Court, I appear for the

second respondent. (instructed by Geoffrey

Edwards & Co.)

BRENNAN J:	The Registrar has been informed by the Attorney-General's Department of South Australia
who act on behalf of the Industrial Commission of
South Australia that they are not an applicant in
this action, and that the Commission does not wish to make any submissions to the Court and will abide
the order of the Court.  Yes, Mr Eleby.

MR ELEBY: If the Court pleases, can I assume that

Your Honours are familiar, or reasonably familiar

at least, with the course these proceedings have

taken. If not, I am happy to take Your Honours

through it.

BRENNAN J: Yes, Mr Eleby.

MR ELEBY:  The first question in this appeal is whether the

Industrial Commission erred in law at all, and by

way of background to that, I think I need to take

Your Honours to some of the essential features of

the system of registration of associations in the

Industrial Conciliation and Arbitration Act, 1972.

If I could take Your Honours first to section 115 - I point out that section 114 contains

a few necessary definitions, but section 115

provides that:

(1) Subject to the provisions of this Part,

any association consisting -

(a) - in the case of employers - of two or

more employers who employ, in aggregate, not

less than 20 employees;

in the case of employees - not less than 20

employees,

may, on compliance with the prescribed

conditions, be registered under this Part.

As Your Honours will be aware, registration confers

certain rights and privileges, incorporation and a

variety of other things.

Clerks(2) 2 7/2/91

Section 116 develops that scheme of

registration a little more and provides that where

the Registrar receives an application the Registrar

has to give notice or publish notice; he has to -

inform such registered associations as the

Registrar considers may be affected by that

application;

and in section 116(l)(c) fixes a day for

consideration of objections which may have been

lodged to the application.

Paragraph (c) provides that:

the objections, made in the manner prescribed

by the Rules, on the ground that the

association is not qualified to be registered

or, in the case of an association of

employees, on the ground mentioned in

subsection (2), to the granting of the

application.

I can skip over subsection (la). Subsection (2) is

what is commonly called the "conveniently belong"

ground:

(2) The Registrar will, whether or not an

objection has been made by any registered

association, unless in all the circumstances
it is, in the Registrar's opinion, undesirable
to do so, refuse an application to register an

association where, in the same locality and

connected with the same industry, there exists

association applying for

a registered association to which, in the

registration ..... might conveniently belong -

and I do not need to read the rest of that section.

I should have said that perhaps in relation to

section 115 there is reference to compliance with

the prescribed conditions. The conditions are

prescribed by rules made under the Act by the

President of the Industrial Commission under

section 175. I do not need I think trouble

Your Honours with the precise nature of those

conditions other than to inform Your Honours that

they require such matters as members having been

agreed to be bound by the rules of the Association,

there are certain minimum requirements to be

included in the rules and that includes a rule

prescribing the ambit of the Association's
membership, that there has to have been a specially

called meeting where the members have resolved to

seek registration and compliance with certain other

formalities.

Clerks(2) 3 7/2/91

The grounds, therefore, on which section 116,

a registration of an association, may be refused

are, firstly, that the association is not qualified

to be registered - and, of course, it may be that

it does not have the required number of employees,

for example, in the case of an association of

employees, or that it has not complied with the

prescribed conditions, or in subsection (2) the

"conveniently belong" type of consideration.

When an association is registered and wants to

change its rules, section 121 becomes relevant.

That provides, firstly, that:

A registered association may apply to the

Registrar for the registration of an addition

to, or the revocation or variation of, any of

its rules.

And, of some significance is subsection (2) that:

No addition to, or revocation or variation of, the rules of a registered association has

effect until registered.

Subsection (3) enables the Registrar to determine

an application ex parte, as it were, or if he is of

the required opinion to publish notice of the

application and to fix a day:

for the consideration of any objections to the

application -

and, of course, that is the usual practice where

there is an application for a change of membership
rule, particularly if it might affect other
associations.

Under subsection (4) he has power to adjourn the application with the consent of the applicant

to enable the applicant to further change its rules

and he can then consider the application with such

rule as changed.

Subsection (5) is the important one for our

present purposes.

The Registrar may refuse an application under

this section -

(a) if, in the Registrar 1 s opinion, the

addition to, or revocation or variation of,

the rules would prejudicially affect the

members of the applicant association or any

other registered association;

Clerks(2) 4 7/2/91

(b) for any reason for which an application by

an association for registration could be

refused;

or

(c)if for any other reason it is, in the

opinion of the Registrar, proper that the

application should be refused.

Paragraphs (a) and (c) clearly require the

formation of an opinion by the Registrar, and that

is clear from the wording of the paragraphs

themselves. Paragraph (b) takes the reader back to

section 116 and I suppose also to 115 and picks up

grounds on which an application for registration

could be refused. An objection on the ground that

the association is not qualified for registration

is perhaps unlikely unless perhaps its numbers have

fallen below the required number. An objection of

that prescribed conditions for registration have

not been met is also perhaps unlikely. One is left

then with the objection based on the "conveniently

belong" question in section 116(2) which

Your Honours will have noted also requires the

formation of an opinion by the Registrar, that is:

unless ..... it is in the Registrar's opinion,

undesirable to do so undesirable to do so -

he may refuse an application - I am sor-y, he is

to:

refuse an application to register -

where -

there exists a registered association to

which, in the Registrar's opinion, the members

of the association applying for

registration ..... might conveniently belong.

Section 116(2) has some difficulty of

application at all under section 12l(S)(b) for the

simple reason that given that the rules of an

association cannot - any change in the rules cannot

be effective until registered. If the application

involves a change in the membership rule to extend

the membership of an association it cannot have any

members in that proposed extended area of

employment until the rule is registered. The

association therefore cannot have members in that

category who might conveniently belong to another

registered association.

Clerks(2) 7/2/91

The Industrial Commission, in this case, I

think, noted that difficulty but was prepared to

overlook it in a sense and give it the broad

interpretation, perhaps, that certainly the

Registrar sought to try and give it but I just

point out that difficulty of application of

transporting, in effect, section 116(2) into the

concepts behind section 121(5)(b).

But the point we make initially is that for

all practical purposes the grounds available for

refusing an application for a change of rules all

depend on the Registrar forming an opinion, in

effect, under each of those three paragraphs of

subsection (5).

The other part to which I should take

Your Honours to, at this stage, is section 104 of

the Act. The change of rules question, of course,

is a matter dealt with by the Registrar.

Section 104 - perhaps I should begin at 103 where

there is a definition of the Full Commission and a

definition of "matter" which excludes certain

things which really does not concern us for present

purposes. Section 104 says:

The Full Commission may grant leave to appeal

to the Full Commission from an act or decision

of the Registrar in relation to a matter
before the Registrar and the Full Commission
may hear and determine an appeal in respect of

which leave is so granted.

Section 105(1) provides for the stay in certain
circumstances and on conditions determined by the
Full Commission where leave is granted.

Section 105(2) indicates the wide powers of the

Commission in hearing such an appeal. That it:

may take further evidence for the purposes of

an appeal -

and subsection (3) enables the Commission, on an

appeal, to:

make such order as it thinks fit and may

confirm, quash or vary a decision of the

Registrar.

I also point out section 105a which enables the

Registrar to:

state a case on a question of law for the

opinion of the Court.

That is, the Industrial Court constituted under

this Act.

Clerks(2) 6 7/2/91

As Your Honours will have noted, the Registrar

in this case decided to register a change in the

membership rule of the appellant.	The respondents
applied for leave to appeal under section 104.	The

Commission, by a majority, refused to grant leave.

In short, they decided that section 121(5) - those

three paragraphs which I have referred to - gave

the Registrar a discretion. They were not

persuaded that there was any real likelihood that

the exercise of the Registrar's discretion had

miscarried. His Honour Judge Lee dissented but

even he acknowledged - and I will come to this in a

moment - that the Registrar had a discretion in

exercise of the powers under paragraphs (b) and (c)

which were the ones that he was particularly

concerned with in his dissent. He dissented

because he considered that the Registrar had unduly

limited the scope of his discretion in considering
the convenience of belonging and was prepared to

grant leave only on that limited basis.

The supreme court on judicial review of that

decision considered that in holding that the

Registrar was exercising a discretion under

paragraphs (a), (b) and (c) the Industrial

Commission was wrong in law. That error

constituted a failure properly to exercise the

jurisdiction of the Commission under section 104

and the Commission's decision should therefore be

quashed and the matter was remitted back to it for

reconsideration.

Our first argument is, as I have indicated, that the Commission did not make any error of law

at all and of course there was ground on which the

supreme court could then properly interfere. Our

alternative submission, and that is in part 2 of

the outline, is that assuming that the Industrial

Commission did make an error of law, it was an

error of law made within its jurisdiction; it did
not go to the jurisdiction of the Commission and

the supreme court was prohibited by section 95 of

the Industrial Conciliation and Arbitration Act

from granting any of the prerogative-type remedies.

In developing the first submission we say

that, as I have pointed out, subsection (5) and

each of its paragraphs, of section 121, requires

course, which indicate the exercise of a

the formation of an opinion by the Registrar.

discretion. We say that this is equivalent to the

Registrar being satisfied as to certain matters and in this context involves the exercise of a

discretion. We sight in support of that - - -

Clerks(2)	7	7/2/91
BRENNAN J:	What discretion are we speaking about?	The

discretion that is inherent in the words "may

refuse" or the discretion which is inherent in

paragraphs (a), (b) or (c)?

MR BLEBY: Inherent in the paragraphs, Your Honour, the

formation of the opinion. The supreme cCourt took

the view that really the discretion did not arise
until matters have been determined under the three

paragraphs and then there was a discretion at large

by virtue of the opening word "may" in the

subsection. But the first point we want to

establish is that words cast in the terms that they

are in the section 121(5) in each of the paragraphs

and by reference back to section 116, in effect,

each require the formation of an opinion which does

constitute the exercise of a discretion.

We refer firstly to the Secretary of State for

Education and Science v Tameside Metropolitan

Borough Council, (1977) AC 1014. That was a

contest between a local education authority and the

Secretary of State who directed the education

authority to effect certain proposals which had

of State sought mandamus against the authority.

previously been approved by the Secretary of State.

The wider political agenda was the question of

grammar schools against comprehensive schools.

The relevant section under consideration

appears in the judgment of Lord Denning on

page 1024. The words in that case were - that is

just below line Eon page 1024:

"If the Secretary of State is satisfied,

either on complaint by any person or

otherwise, that any local education authority

... [has] acted or [is] proposing to act

unreasonably -

et cetera -

exercise of the power or the performance of he may ... give such directions as to the the duty as appear to him to be expedient."

Lord Denning, in the Court of Appeal, on that page

beginning at line G, said this:

So far as "satisfied" is concerned, it is

suggested - and was suggested by the chief

officers of the local authority on June 21,

1976 - that once the Secretary of State said

that he was "satisfied" his decision could not

be challenged in the courts unless it was

shown to have been made in bad faith. We were

Clerks(2) 7/2/91

referred by Mr Bingham to Liversidge v

Anderson where Lord Atkin drew attention to

cases where the Defence Regulations required

the Secretary of State to be "satisfied" of

something or other. Lord Atkin said, "In all

these cases it is plain that unlimited

discretion is given to the Secretary of State, assuming as everyone does that he acts in good faith," to which I would add a similar passage

by Somervell LJ in In Re City of Plymouth.

Those statements were made, however, in

relation to regulations in war time or

immediately after the war when the decisions
of the executive had to be implemented
speedily and without question. That was

pointed out by Lord Radliffe in Nakkuda Ali v

Jayaratne and by Lord Reid in Ridge v Baldwin.

Those statements do not apply today -

and this, I suppose, is the relevant passage - Much depends on the matter about which the

Secretary of State has to be satisfied. If he

is to be satisfied on a matter of opinion,

that is one thing. But if he has to be

satisfied that someone has been guilty of some

discreditable or unworthy or unreasonable

conduct, that is another.

Of course, the reference there to "opinion" does

have some direct application to the words used in

section 121(5).

Might I also take Your Honours to the speech of Lord Wilberforce at page 1047, beginning where he has subparagraph (2) between letters C and D.

The section -

he said -

is framed in a "subjective" form - if the

Secretary of State "is satisfied." This form

of section is quite well known, and at first

sight might seem to exclude judicial review.

Sections in this form may, no doubt, exclude

judicial review on what is or has become a

matter of pure judgment. But I do not think

that they go further than that. If a judgment

requires, before it can be made, the existence
of some facts, then, although the evaluation
of those facts is for the Secretary of State

alone, the court must inquire whether those

facts exist.

And I would add, also, although it is not in the outline, the reference to Lord Diplock's speech at

Clerks(2) 9 7/2/91

page 1064 of the report, a short passage beginning

just above letter F:

The very concept of administrative

discretion involves a right to choose between

more than one possible course of action upon which there is room for reasonable people to

hold differing opinions as to which is to be

preferred.

We also refer to a passage in de Smith's

Judicial Review of Administrative Action,

4th edition, at page 285, where the author is

speaking generally of review of administrative

powers and the limits on review of discretionary

decisions. I just cite the second-last sentence in

the first paragraph on page 285:

Finally, a court may explain its unwillingness to review for error of law an inference drawn

by an administrative tribunal from primary

facts to a statutory standard when no uniquely

correct answer is indicated by saying that the
matter is one of fact, degree or opinion.

Discretion, in other words, may be conferred

implicitly as well as expressly.

Finally, we would adopt, with respect, a dictum of His Honour Mr Justice Sholl in a Victorian case of

Russo v Russo, which I think was not on the list

but copies of which are available for Your Honours,

(1953) VR 57, and the passage that we would adopt

is at page 62 where, in the third line of the last

paragraph, His Honour asks:

What is a discretionary determination? I have

distinguish such determinations from those non-discretionary decisions, to appeals from

not found, in the cases cited in Halsbury's

or reviews of which different considerations

considerable latitude of individual choice of	apply. At least the concept involves a	a conclusion - a right in the tribunal,
adhering to certain general principles, and
taking into account relevant factors, to
decide nevertheless according to its individual opinion. It involves further that the tribunal, instead of merely ascertaining and declaring existing rights, formulates for the first time, and declares, new rights according to its own opinion - the only pre-
existing right having been a right to have the tribunal's discretion exercised on the correct materials.

Clerks(2) 10 7/2/91

It is our submission that the majority of the

Industrial Commission in this case correctly recognized that the Registrar was, in fact,

exercising a discretion under those paragraphs and

that was so of all members of the Commission and I

refer Your Honours to Judge Allan's judgment at

page 23 of the appeal book, beginning at line 25,

and, indeed, at line 29, he says:

In the present case, a reading of section 121 of the Act reveals immediately that the decision of the Registrar with which we are here concerned was a decision which involved

an exercise of discretion. Sub-section (5)

makes that clear. I think it is not putting

it too highly to say that the discretion which

the Registrar was exercising in this case was

a wide one.

Commissioner Perry agreed with His Honour although he was in dissent on the question of the

granting of leave, said this at line 20:

I would express my conclusions in this

way. In declining to further consider the
extent to which the amendment promotes

competition for membership between

associations, the Registrar unduly

circumscribed the scope of his discretion

under section 121(5)(b) and (c) of the Act.

We respectfully say that the Commission was correct

in saying then that there was no basis for

interference with the Registrar's discretion.	The
Commission then went on to correctly state the

basis on which an appellate body could interfere

and that is stated by His Honour Judge Allan at

page 23 in the passage beginning at line 36 where

he refers to House v Rand the the well known

principles upon which the exercise of a discretion

may be overturned.	I will not read that passage
but - - -

GAUDRON J:  Why does one read those principles into

section 105, or perhaps you do not suggest that

they are to be read in?

MR ELEBY:	105, Your Honour, or 121(5)?
McHUGH J:	104, is it not?
GAUDRON J:	I am sorry, 104.
MR ELEBY:	Yes. All I am dealing with at the moment is the Full Commission's view of what the Registrar was
doing under 121(5).  We are saying that 121(5),

Clerks(2) 11 7/2/91

each of the paragraphs involves the exercise by the

Registrar of the discretion. The Commission

correctly said "That was so, there are no grounds
shown on which we can properly interfere with the

exercise of that discretion" . But, of course, we

will go further in a moment and say that 104

provides a discretion at large, of course, in the

granting of leave or refusing leave to appeal which

in itself is not circumscribed by any particular

rules either. But, that is a slightly different

question from the question which the supreme court

dealt with where it said, in effect, that the Full

Commission was wrong in saying that the Registrar

was exercising a discretion under 121(5).

DAWSON J:  Where do you say the discretion resides in (S)?

Within the word "may" or within the formation of the opinion?

MR BLEBY:  The formation of the opinion, Your Honour, in

each of those paragraphs, and that is the way the

Industrial Commission treated it. I will come in a

moment to point out what the Full Court said about

that. They said the discretion lay in the word "may". That may or may not be correct and I do not

think that this Court needs to decide that but all

we need to establish is that the discretion also

lay in each of those paragraphs.

DEANE J: Are you dealing with it on the basis that the

Registrar had a wide discretion by reason of the

matters in dispute in the particular case, or are

you saying that under (b), for example, he must

always have a wide discretion?

MR BLEBY:  He must always have a wide discretion but it

will, of course, be based on facts which have been

placed before him.

DEANE J:  What if the objection were that the alteration to

the rules would have the effect that the rules no

longer complied with the requirements for

registration?

MR ELEBY:	I accept that
DEANE J:	(b) would involve no discretion at all.

MR ELEBY: That is so. I pointed out, however, the

unlikelihood, perhaps, of that arising because

presumably the rules have been scrutinized at the

registration process.

DEANE J: But once you get it, that it may be the generality

is destroyed which means must you not go to what

was in issue in the particular case?

Clerks(2) 12 7/2/91

MR BLEBY:	Yes, you must but in this particular case none of those questions arose.
DEANE J:	I was looking for a brief statement of the issues

before the Registrar on the particular case.	I
have not found it.

MR ELEBY:	The issues before the Registrar were - one of the issues was under (a), whether the change in rules
would prejudicially affect - - -

DEANE J: Well, is there a short statement of it or can we

only ascertain it by reading the decision as a

whole?

MR ELEBY:  It can certainly be ascertained by reading the

Registrar's decision. It can also be ascertained,

I think, in perhaps - also from His Honour

Judge Allan's decision beginning at page 24 where

he dealt with the Registrar's treatment of the

application firstly under paragraph (a), beginning

between lines 25 and 30:

He concluded that the addition sought by the respondent would not prejudicially effect

its -

that is, the applicant's -

members;	and there was no challenge to that
finding.

He -

then considered the question of prejudice to

members of the appellants -

that is the present respondents; set out what the

Registrar said about that in that page and the

following page. On page 26, line 18, said:

these reasons were published after the decision had I reached the conclusion -

been made -

that no error was indicated in the way the

Registrar dealt with this matter.

And he recites Mr Haywood-Smith's submission and

said that:

The Registrar rejected this

argurnent ..... Mr Hayward-Smith did not point to

anything in the evidence to make me think that

the Registrar might have been wrong in

reaching his conclusion.

Clerks(2) 13 7/2/91

Then he moved to paragraph (b) and it was assumed

that the only relevant matter that could possibly

be imported by paragraph (b), in this case, was the

question of "conveniently belong". He dealt with

what the Registrar said about that on page 26 and

through page 27. On page 28 he shows how it is

imported from section 116(2). At the bottom of

page 28 he expresses doubts as to whether that

question as contained in the section can validly be

transported for the reasons which I previously

mentioned; indicated that the Registrar himself

seems to have been a bit uncomfortable about that

transposition too, but then followed up on what the

Registrar did half-way down page 29, at line 25.

He said:

It seemed to me that, on this topic, the

matter of real substance lay in the
penultimate paragraph of the passage I have
cited above from the reasons for decision of

the Industrial Registrar on this topic.

And that is the paragraph at line 15 on page 28,

and said:

Now, whether that is an application of the

'conveniently belong' test or not, it is a

matter relevant to the exercise of the

discretion; and Mr Heywood-Smith did not

suggest the Registrar was in error in finding

that the appellants could not cover the

majority of persons sought to be covered by

the proposed addition.

Then he deals with a submission by the objectors or the then applicants for leave; that the Registrar

should have exercised its discretion under

subsection (4) and said there was nothing wrong
with what the Registrar did there and then he dealt

with some of the discretionary matters that were

raised under paragraph (c), "any other reason".

There had been a few other reasons advanced such as

Public Service Association was departing from its	the fact that the change in question meant that the
traditional areas of coverage. His Honour said,
well, he could not detect any error in the way that the Registrar treated that and his conclusion generally - this is again speaking for the
majority - at page 30 at line 36:

It was for these reasons I thought leave

to appeal should be refused. I was not

satisfied that there existed a real likelihood

that the exercise of the discretion had

miscarried. It had not been demonstrated that

there was a real likelihood that, in the

exercise of his discretion, the Registrar had

Clerks(2) 14 7/2/91

acted on a wrong principle, had taken into

account irrelevant material, had failed to

take into account relevant material, had

mistaken some matter of fact or that the

result was unreasonable or plainly unjust.

McHUGH J:  You seem to accept that, "may refuse" in the

opening words of subsection (5) and the issues

under (a), (b) and (c) are separate, but why are

not the opening words to be read with each

paragraph, as constituting an entire discretion?

For example, take paragraph (b): why is not the proper way to read it:

The Registrar may refuse an application under

this section -

"for any reason which an application for

registration could be refused". The ground may

have been made out in an objective sense, but it is

a matter for the Registrar if he wants to seize on

that particular ground. He has got a discretion.

MR BLEBY:  I would not quarrel with that, Your Honour. I am

quite happy to accept that the combination of

"may", even be as it stands, but certainly coupled

with the requirement to form an opinion in the

other paragraphs and any transposition of

section 116 makes that abundantly clear.

DAWSON J: That is giving me trouble there. I thought you

were saying that there is a discretion involved in

the formation of an opinion, which is a strange

concept to me. Either you form an opinion or you

do not. That may then be the basis for the
exercise of a discretion but in itself is not the

exercise of a discretion.

MR BLEBY:  Yes. I suppose what I am saying, it is not cast

in a sense which says, "The Registrar may do this

if certain facts are established". He has, in a

sense, a discretion to exercise as to whether or

not - - -

DAWSON J:  As long as it is bona fide forms an opinion.

That is the basis on which he exercises his

discretion, but that does not mean in forming the

opinion he is exercising a discretion.

MR BLEBY:  No, but there is a difference, I would submit,

between that and formally finding that certain

facts exist.

DAWSON J: Well you cannot question his opinion if it is

bona fide and properly based -

MR BLEBY:  No, that is so.

Clerks(2) 15 7/2/91

DAWSON J: That is not a discretion.

MR ELEBY: No. Well I accept that, with respect, and as I

say, I am quite happy to treat it as Your Honour

Justice McHugh suggested.

GAUDRON J: Except that subsection (6) might indicate that

"may" does not have its ordinary meaning in

subsection (5).

MR ELEBY: That deals with a particular situation where the

association is a branch of a federally registered

organization.

GAUDRON:  Yes, but it says "may register". Notwithstanding

that it may refuse it then "may register", as

though subsection (5) were intended to read, "the

Registrar shall refuse if".

MR BLEBY:  Yes, that I would suggest is perhaps by way of exception to what goes before. I appreciate that

it may lead to an argument that "may" does mean

"shall" in subsection (5), but I would suggest,

with respect, that that does not diminish the

strength of the argument that whatever the

Registrar is doing under (5) is nevertheless

discretionary.

BRENNAN J:  You are using that in terms of description of a

value judgment, are you not?

MR BLEBY:	Yes.
BRENNAN J:	And so the difference I would have thought between a discretion and a value judgment is that
in a discretion you can give whatever weight you
like to factors to fit; in a value judgment, it is
a question of finding what values are appropriate
to be applied to the facts as they exist.
MR BLEBY:	Yes, I agree with that, with respect.

BRENNAN J:  Does "may refuse if" equal "may not refuse

unless"?

MR BLEBY:  I do not know that that needs to be decided in

this case. I know one is dealing with semantics a

little bit, but to the extent that the authorities

refer to the fact of the exercise of a discretion

as forming an opinion that may be tending to

confuse the issue a little, but the authorities we

have cited do refer to it in those terms. There is

a sense in which the exercise of a discretion is

the formation of an opinion.

What will happen here, in our submission, is that the Registrar will have before him certain

Clerks(2) 16 7/2/91

facts.	He will reach an opinion or a conclusion
which other people might not reach.	One cannot say

that there is an absolute standard, but he is

entitled to form that opinion, reach that

conclusion, and if not constituting in every sense

the exercise of a discretion, is so close to it
that it should be treated in the same manner; and

so far as an appellate tribunal is concerned, will

be treated in the same manner and will be tested

against the usual tests against which one tests the
exercise of a discretion where it is under

challenge.

DEANE J:  What you say is that each of the judgments which

were involved in this case were discretionary

judgments in the sense explained by Justice Sholl

in the case you referred us to.

MR BLEBY:  Yes. Now, we also point out that in addition to

that, of course, not only was the Full Commission

expressing a view - we say with respect a correct

view - as to what the functions of the Registrar

were, but it was doing so in the course of

exercising a very wide discretion which it itself

had under section 104, an unqualified discretion as

to whether or not to grant or refuse leave to

appeal; and the breadth of that discretion can be

further gauged from the nature of the appeal itself

and the very wide powers of the Commission to which we have already referred in section 105(2) and (3),

and even the presence of 105a, the ability of the

Registrar to refer questions of law to the

Industrial Court as an indication of matters which

could be taken into account by the Full Commission

in determining a leave application from a decision

of the Registrar.

The Commission found that there was no real

likelihood that the exercise of the discretion had

miscarried and that, as appears in the outline, is

abundantly clear from page 24, Judge Allan's

judgment, again. He says:

It seems to me, therefore, that unless the

applicant for leave to appeal pursuant to

section 104 of the Act in circumstances like

the present can demonstrate that there is a

real likelihood that the exercise of

discretion has miscarried, leave to appeal

should be refused. As it happened, in the

present case I was not satisfied that such a

likelihood existed; and, so, I thought leave

to appeal should be refused.

DEANE J: Is that right, though? I mean, on an appeal to

the Commission, is the question for the Full

Commission whether the Registrar's discretion

Clerks(2) 17 7/2/91

miscarried or is the question whether the

Commission thinks that that was the way the

discretion should have been exercised because I

notice that 105(2) says the Full Commission can

take further evidence?

MR ELEBY:  If the Commission is satisfied on an application

for leave that it cannot see any case to be made
out for an interference with the discretion, in our
submission it would be proper to refuse leave.

DEANE J: In other words, that is the critical question, is it not, whether the Full Commission is entitled to say, "We will adopt the approach that we won't

grant leave unless we think the Registrar's

exercise of discretion was wrong in the sense that

it has miscarried. We won't grant leave because we

think the case is a very important one and warrants
a consideration by the Full Commission of the

question whether the result was the right one."?

MR BLEBY:  The Commission need not, perhaps, have gone as

far as it did by expressing its view on what the

Registrar did. The reasons read, perhaps, a little

more as though it is a conclusion on an appeal

itself but the Commission, in our submission, was

entitled to say, "Well, look, there is nothing that

we can see that even suggests that the Registrar

erred. There's nothing else been put to us for any

other reason why leave should be granted.	We
refuse leave."

The view taken by the supreme court was that

the Full Commission had erred, in effect, in saying

that the Registrar was exercising a discretion and

that in reaching the conclusions under each of the

paragraphs of section 121(5) the Registrar was, in

reality, finding facts. I take Your Honours to the

judgment of His Honour Justice White at page 57.

His Honour sets out the terms of subsection (5) and

continues, at line 17:

The Registrar considered the facts and

the arguments in the application before him

and, after doing so, he made negative findings
of fact. Errors in such findings could have

been subject to an ordinary right of appeal to

the Commission. The addition of the words "in

the Registrar's opinion" in para (a) do not

extend or expand the fact-finding nature of
the Registrar's task as to prejudicial effect.

And insofar as the the words "in the opinion of the Registrar" in para (c) give him some

discretion in relation to the propriety of refusal, such discretion is quite limited.

Over the page, at page 58, line 17:

Clerks(2) 18 7/2/91

As it is, the Registrar made negative

findings; he found that no ground had been

made out entitling him to refuse. After

reaching that conclusion, the Registrar had no

residual discretion.	He was bound to grant
the application.	The main, and only

substantial, discretion was to grant or refuse

the application after having made one or more

adverse findings under paras (a) to (c). Not

having made any adverse findings, it follows

the Registrar's discretion to refuse was

exhausted.

His Honour seems there to be treating - although he

does refer - and perhaps I should have read this -

at the bottom of page 57 to:

a limited discretion -

in considering the paragraphs in subsection (5), he

appears to have taken a similar view to that of

Justice Mohr, which is expressed perhaps more firmly at page 62. There His Honour quoted a

passage from Judge Allan's judgment about the

exercise of discretion and at line 15 said:

The first question to be decided is

whether or not this -

that is Judge Allan's description of the function -

was a correct description of the Registrar's

function in the circumstances of this case.

In my opinion it is not correct. It is

clear from the reasons given by the Registrar

that he found none of the grounds referred to

in Section 121(5)(a), (b) or (c) to have been

made out. In other words he decided questions

of fact which having been decided in the way

in which they were precluded him from doing

other than grant the application.

Then he went on to paraphrase what he believed

section 121(5) was saying and concluded at line 32:

The discretion imported by the word "may" in

the opening words of the subsection only

arises if one or more of the matters

in (a), (b) or (c) are made out.

In our respectful submission, the Full Court's

error was that in holding that the Registrar, in acting under paragraphs (a), (b) and (c) was not

exercising a discretion but was deciding questions

of fact and that there was in some way a residual

discretion which only arose at the end of all that

Clerks(2) 19 7/2/91

by virtue of the opening words. But, all those

matters which the Registrar was required to decide are matters of judgment or opinion as the section,

indeed, recognizes. Paragraph (a) deals with

matters of prejudice. Paragraph (b), if you import

section 116, deals with matters of convenience.

Paragraph (c) deals with matters of propriety.

Those findings may be based on facts that the

Registrar finds but they do not in themselves

constitute findings of fact and we say, with
respect, that in so holding the supreme court erred
whereas the Industrial Commission was correct.

We point out in paragraph 1.5 of our outline

that the word "may" which, of course, is in the
opening words of subsection (5), in its ordinary

meaning is permissive of facultative and we cite in

support of that a decision of this Court in

Coldham's case and the passage, indeed, is at
page 347 at point 9 - I will not take Your Honours

to it. Coldham's case, Your Honours may recall,

was a case involving the question of registration

of organizations under the Conciliation and

Arbitration Act, involving the registration of an

application to register a number of teachers

unions.

Your Honours may recall that the first

application was by an organization which was the

Teacher's Association of Australia, called in the

judgment TAA. The second one, in point of time,

was an application by the Independent Teacher's

Federation. The third one was an application by

the Australian Teacher's Union.

The Registrar heard, I think he heard them

together but he announced first that he would not

refuse registration to TAA but would decide whether

he would do it conditionally or unconditionally

when he has heard other submissions. He also

decided that he would not refuse registration of

the ITF and would also grant registration of ATU.

Now, the second two appealed against the

registration of the first, that is to the Full

Commission of the Conciliation and Arbitration

Commission as it then was and the Full Commission

held that objections could be taken and could be
heard and determined on grounds other than those

specified in the Conciliation and Arbitration Act

and that the Registrar had erred in arriving at a

decision that he would not refuse to register TAA
before he had completed the hearings in relation to

the other two.

The Full Commission decided that the ITF

should be registered, the TAA registration should

be quashed, but only after considering grounds

Clerks(2) 20 7/2/91

outside the strict grounds which the Act allowed.

This Court held that there was no discretion to

withhold registration beyond the grounds stated in

the Act and by taking such grounds into account and

substituting its own decision for that of the

Registrar, in effect, the Commission had erred in

law and misconstrued its function and it quashed

the Full Commission's decision.

Now in the same way, of course, we would say

that similar considerations in this Act would

apply, that the Registrar could only take into

account matters by way of objection that the Act
allows him to take into account. It does not

confer a residual discretion to be exercised at

large which is what the Full Court seems to have

suggested by its interpretation of subsection (5).

We would submit that the opening words of the

subsection merely specify discretionary grounds on

which the application may be refused. One might be

able to argue indeed, although it is probably not

necessary, that "may" in that subsection is

mandatory and that it is expressing the only

grounds on which an application for a rule change

may be refused and that it must be refused if those

grounds are made out. But I do not know that one

needs to take that any further.

So, we say, with respect, that the Full Court of the Supreme Court erred in saying that what the Registrar was doing was deciding questions of fact

and in disagreeing with the Full Commission that in

effect the Registrar was exercising a discretion at

each step. We say, therefore, that there was no

error of law to be corrected by the supreme court

on judicial review.	I think that is all I would
wish to say on that particular topic.	If the Court

agrees with that submission which, of course, is

our main submission, it would allow the appeal and

need not concern itself with part 2 or the second

alternative submission that we make, that is, as to

whether if there was an error of law, it was an

error of law which went to the Commission's

jurisdiction.

On that issue, I must first take the Court to section 95 of the Act which reads:

Except as is provided by section 96 -

and section 96 provides a system of appeals within

the Commission to a Full Commission but nothing

beyond a decision of the Full Commission -

(a) every award, order or decision of the

Commission or a Committee is final and no such

Clerks(2) 21 7/2/91

award, order or decision can be removed to any

other court;

and

(b) no award, order or proceeding of any kind

of the commission or a Committee can be
challenged, appealed against, reviewed,

quashed or called in question except on the

ground of excess or want of jurisdiction.

we would submit that paragraph (a), on its

face, prevents proceedings based on error of law

such as certiorari. Paragraph (b) reinforces that,

saving only as to acting in excess or want of

jurisdiction. It is our submission that the

distinction between error of law made within

jurisdiction and error of law going to jurisdiction

is well known.	It has been often applied in this
Court.	We cite a number of relevantly recent cases
where that is held to be so.	The first one is
Dunphy's case:	Reg v Dunphy Ex Parte Maynes,
139 CLR 482.

That was a case where, by amendment to the

Conciliation and Arbitration Act made with effect

from 13 November 1973, section 133(1) required the

rules of an organization to contain certain

provisions concerning the election of officers. The rules of the Federated Clerks Union did not contain those provisions but the amending Act also

gave organizations three years, that is, until

13 November 1976, to change their rules to make

them conform to the new requirements. A member

brought proceedings under section 140(3) of the

Conciliation and Arbitration Act for a declaration that the rules of the organization contravene

section 140(1)(a) in that they did not make

provisions required by the Act.

Those proceedings were commenced on

28 September 1976, that is, within the three year
grace period.	The Industrial Court, on

23 December 1976, that is, after the three year

grace period, made an order declaring that as at

28 September the rules contravened

section 140(l)(a). There was a further

complication, though, because as from

12 November 1976, tha.t is, between the date of the

application and the date of the order, the Act was

further amended to make different provision for the

election of officers and allowing a two year period

of grace from that time to change the rules of

noncomplying organizations.

This Court, by a majority, held that the

Industrial Court made two errors, firstly, in

Clerks(2) 22 7/2/91

holding that there is a non-compliance with

section 140 during the three year grace period and

secondly, in holding that the order spoke from the

date of the application and in fact that it speaks
under the sections from the date of the order and
also held that any non-compliance with the 1976

requirements, that is the second set of amendments

as at the date of the order, if there was such

non-compliance was protected by the two year grace
period then in force.

Having decided those matters the question arose whether prohibition or certiorari should go.

The leading judgment was that of Justice Mason as

he then was and I refer to that particularly at

page 495. At about point 8, His Honour said this

speaking for the majority:

All that I have said leads to the result

that the Court was in error in making the

order which in fact it made. Of course, it

does not follow that the prosecutors are

entitled to relief by way of prohibition or

certiorari, for the existence of error in the

judgment or order of an inferior court or

tribunal is not a sufficient title to relief

by way of prohibition or certiorari. However,

in two respects at least the errors to which I

have referred went to the jurisdiction of the

Court.

And he went on to explain why, but nevertheless recognised the difference that error of law by

itself is not sufficient to entitle prerogative

writ relief.

The next case which we rely on is the

Pilkington ACI case, 142 CLR 113. In that case

prohibition was sought against the Federal Court to
prevent the Federal Court from determining an

application under section 80 of the Trade Practices

Act for an injunction on the ground that the words

a class of persons who could commence actions under	"any other persons" in section 80 when referring to
that section did not include trade competitors. It
was alleged, therefore, that the Federal Court had no jurisdiction to entertain the particular
application. This Court unanimously held that the Federal Court had jurisdiction to interpret
section 80 and to decide the question of locus standi and that prohibition would not lie. But,
again, His Honour Justice Mason, at page 126 of the
report, on behalf of certainly three other Judges
of the Court, made a reference to the distinction,
at about point 4, he said:

Clerks(2) 23 7/2/91

In my view, therefore, the case is one in

which the Federal Court is engaged in

exercising the jurisdiction which is assigned

to it. It is conceivable that in exercising

this jurisdiction it may arrive at an

erroneous decision which will be subject to an

appeal under section 23 of the Federal Court

of Australia Act, but this circumstance,

should it eventuate, constitutes no ground for

saying that the Federal Court is exceeding its

jurisdiction. The remarks of

Chief Justice Dixon, Justices Webb, Fullagar

and Kitto in ..... Amalgamated Engineering

Union case made with reference to an

application under section 29 of the

Conciliation and Arbitration Act .. ... for an order enjoining a contravention of section

96M, have equal application to this case.

Their Honours said:

"There was a proceeding regularly before it,
an application for relief which it was

authorized by the Act to entertain. In the course of entertaining that application, it had of necessity to consider the question of

the construction and effect of section 96M(6).

The determination of that question was a

matter within its jurisdiction, and, where the

remedy sought is prohibition, it is not to the

point to say that it determined that question

wrongly."

I cite, without reading it, His Honour

Justice Aickin's judgment beginning at page 135 at about point 7 where His Honour cited with approval

some other cases where the dissension is clearly

made.

We point out that the question is not always

without difficulty as this Court found in Gray's

case which is referred to in the outline - Reg v

Gray; Ex Parte Marsh. That involved section 159 of

the Conciliation and Arbitration Act and an inquiry	into an election where there has been, to use the
words of the Act, "an irregularity in or in
connection with an office in an organization". The
case turned on the meaning of the word
"irregularity in or in connection with an office".
The Court, by a statutory majority only, held that
the Federal Court did not have power to determine conclusively the matter on which section 159(1)
depends, that is, whether there was, in fact, an
irregularity. The existence, of course, of the
irregularity was fundamental of the court's
jurisdiction but that this Court could determine for itself whether the case constituted an
irregularity.

Clerks(2) 24 7/2/91

Notwithstanding the difficulty and the fact that the Court divided, all members of the Court

referred to and acknowledged the distinction

between error of law within jurisdiction and error

of law going to jurisdiction. I take, by way of

page 371 point 4:

example only, passages from the Chief Justice

There is a well recognized distinction between

an error made by a tribunal in the course of

deciding a matter, on the one hand, and an
absence or excess of jurisdiction on the

other -

and, indeed, he cites the Pilkington case to which

I have just referred:

Since Anisiminic Ltd ..... it has been more

clearly understood that an error of law may

amount to a jurisdictional error even though

the tribunal which made the error had

jurisdiction to embark on its inquiry -

and he cited a passage from the speech of

Lord Wilberforce, cited with approval and it

included, about half-way down that passage:

A tribunal may quite properly validly enter

upon its task and in the course of carrying it

out may make a decision which is invalid - not

merely erroneous. This may be described as

'asking the wrong question' or 'applying the

wrong test' - expressions not wholly

satisfactory since they do not, in themselves,

distinguish between doing something which is

not in the tribunal's area and doing something wrong within that area - a crucial distinction
which the court has to make.

On the other side of the case, His Honour

Justice Mason at page 374 point 5 again recognized

the distinction:

Prohibition will issue for jurisdictional

error and denial of natural justice, but not

for non-jurisdictional error of law ..... The

decisions of this Court provide many instances

in the field of industrial arbitration of
refusal to grant prohibition for non-
jurisdictional error.

I also mention, without taking the Court to them, the pages where other members of the Court also

recognized a distinction: Justice Wilson, at

page 379 at about point 3; Your Honour

Justice Brennan, in adopting a passage from

Clerks(2) 25 7/2/91

Willan's case at pages 379 to 380; Your Honour

Justice Deane at page 390, and Your Honour
Justice Dawson at page 394 at about point 4.

The point was that everyone in the Court agreed that Justice Gray had made an error in that

case. The question on which the Court divided was

whether that error went to its jurisdiction.

Nevertheless, the distinction was fairly

recognized.

We point out in our outline that it was a

distinction that was accepted by all parties in

Houssein's case - I will not take the Court to that
but it involved a not dissimilar ouster provision
to this one in the New South Wales Industrial

Arbitration Act where the High Court held that the

relevant section of the New South Wales legislation

effectively ousted the jurisdiction of the New

South Wales Supreme Court. It was accepted in that

case by the court and by counsel arguing it that

the error, if there was an error, was an error

within jurisdiction and, therefore, in the event

that the court could do nothing to interfere.

We also cite, in the outline - and I will not

take the Court to them - by way of example, only, decisions of the Supreme Court of New South Wales

and of Victoria, where the distinction has been

maintained. Your Honours just might note the

particular passages in the Small Claims Tribunal

case, as mentioned in our outline; the judgment of

Justice Gowans at page 840 to 841 and the Court of

Appeal in New South Wales in the Grenvill Homes case, Justices Hope and Samuels at page 609.

Perhaps of more significance, it is a

distinction which has been applied continually by

the Supreme Court of South Australia in the

application of section 95 and its predecessor and

we refer there to Olsson's case, 5 SASR 248. That

was an application for certiorari in the supreme

court against a decision of the Industrial

Commission - the case began in the then Industrial

Court, I am sorry, for the recovery of wages

allegedly due under an award for work performed by

an employee in after-hours work.

The question at issue was whether section 82

of the then Industrial Code applied which had the

effect of extending award rates of pay to non-award

type employment. The employer sought prohibition

saying the Industrial Court was in error in applying section 2 to the facts. It had no

jurisdiction to make the order. The Industrial

Code had a identical privative provision to section 95.

Clerks(2) 26

It was held by the Full Court that the

Industrial Court's interpretation of the Act was correct but even if it was not it was acting within its jurisdiction and that is clear from

Chief Justice Bray's judgment at page 252 where he

adverted to the difficulty sometimes of

categorizing the question. It was 252 to 253 which

I will not read but perhaps I might read from the

judgment of Mr Justice Zelling at page 254, in the

last paragraph:

Whether he was right or wrong -

that was the President of the Industrial Court -

in so deciding is beside the point.

Personally I think he was right, but this is not of any importance in the circumstances.

Under s 19 he had power to hear and determine any question of law involving the

interpretation of the Act and to interpret an

award. He was, in this case, interpreting the

interaction of a section of the Act and the

provisions of an award, and in my opinion he

was acting within his jurisdiction in so

doing. It might be different if a question of

law involving the interpretation of the Act

went to a question of the limits of his

jurisdiction. If that were so, I think that

his determination would not be final and could

be questioned in this Court by the appropriate

prerogative writ, but that is not this case.

More recently in the Theatrical Employees

case, Reg v Industrial Commission; ex parte

Australian Theatrical and Amusement Employees

Association, 43 SASR 434, that was an application

for certiorari against a decision of the Industrial

Commission under section 108a of the present Act to

approve an industrial agreement which was a

necessary prerequisite to registration of the

agreement.

It was alleged that the Commission

misconceived its powers under section 108a and that

the Commission had erred in holding that in the

circumstances the Commission could not exercise the

powers under section 28(1)(f) which enabled the

Commmission to refrain from further hearing the

matter in the public interest.

The leading judgment was delivered by

His Honour Justice Olsson, and at page 439

His Honour quotes section 95 of the Act. He

referred to difficulties which arise in giving

effect to the section that they had been referred

to in Olsson's case. At about point 7 he says:

Clerks(2) 27 7/2/91

In applying a privative provision such as

s.95 it becomes essential to bear firmly in

mind at all times the need to preserve a clear

distinction between acting outside

jurisdiction on the one hand and making an

error of law within jurisdiction on the other.

He then referred to a speech of Lord Reid in the

in which we suggest there is simply no room for a

general discretion in the Registrar, particularly

because of the presence of section 121(5)(c) which

is to the effect that he may refuse if he is of the

view that for any other reason it would not be

proper to register the change.

Your Honour, that being the case, it is very

difficult, with respect, to see how there can be a

general discretion in the Registrar to do something
contrary to a finding under (c) because of the

presence of the word "may" in the opening part of

the section.

McHUGH J:	You talk about them as findings, but the theory of this whole section is that registration is
automatic unless the Registrar is satisfied of
certain things, then he can refuse to register.
But, even if he was satisfied with all those
things, he could still refuse to register.
MR KENZIE:	Your Honour, that, with respect, raises the

whole - I hear Your Honour put that - we contend to

the contrary and we say a number of things in

support of both of the submissions.

Clerks(2) 45 7/2/91

As to the first construction, the construction

was adopted by the Supreme Court. We say, firstly,

that the words are not to the effect that the

Registrar has a power to decide whether he may or

may not register.	The words of section 121(5) are
that:

The Registrar may refuse an application under

this section -

(a) if, in the Registrar's opinion, the

addition to, or revocation or variation -

et cetera, or:

(b) for any reason -

or:

(c) if for any other reason it is, in the

opinion of the Registrar, proper.

Now, Your Honour, (a) to (c) are in there for some

reason and to suggest that the Registrar is to be

given some general discretion regardless of the

findings under (a) to (c) really reduces those

provisions to nothingness. Those are the words

that are selected by the legislature to give rise

to a certain result and if a finding is made -

described as a negative finding by the

Supreme Court - then, on a proper construction of

the section, no discretion remains.

DAWSON J: Those are the only grounds on which he can

refuse?

MR KENZIE:  Yes.

DAWSON J: Therefore, if those grounds are not made out, he

must grant?

MR KENZIE:

Yes, Your Honour, it is as simple as that.

BRENNAN J: Then, your interest lies in establishing that he

has got a discretion?

GAUDRON J:  Or in establishing that "may" means "shall" by

reason on subsection (6)?

MR KENZIE:  Your Honour, we come to that in our second

argument but - - -

BRENNAN J:	And you will do that tomorrow?
MR KENZIE:	Yes, Your Honour.

Clerks(2) 46 7/2/91

BRENNAN J:  The Court will adjourn until 9.30 am tomorrow

morning.

AT 4.32 AM THE MATTER WAS ADJOURNED

UNTIL FRIDAY, 8 FEBRUARY 1991

Clerks(2) 47 7/2/91