Re Media, Entertainment and Arts Alliance; Ex parte The Hoyts Corporation Pty Ltd; Ex Parte The Hoyts Corporation Pty Ltd

~ ~ -, .... JA

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Melbourne No M27 of 1992
In the matter of -
An application for a Writ of
Prohibition and a Writ of
Mandamus against THE
HONOURABLE JUSTICE ALAN
BOULTON, THE HONOURABLE
DEPUTY PRESIDENT COLIN
GEORGE POLITES and
COMMISSIONER ADRIAN DANIEL
FOGARTY, Members of THE
AUSTRALAIN INDUSTRIAL
RELATIONS COMMISSION

First Respondents

MEDIA, ENTERTAINMENT AND

ARTS ALLIANCE

Second Respondent

Ex parte -
THE HOYTS CORPORATION PTY
LIMITED

Prosecutor

Hoyts(2)

3/11/92

Office of the Registry

Melbourne No M43 of 1992
In the matter of -
An application for a Writ of
Certiorari and a Writ of
Mandamus against THE
HONOURABLE DEPUTY PRESIDENT
MICHAEL FRANCIS MOORE, THE
HONOURABLE DEPUTY PRESIDENT
COLIN GEORGE POLITES and
COMMISSIONER JAMES WILLIAM
LESLIE SIMMONDS, Members of
the AUSTRALIAN INDUSTRIAL
RELATIONS COMMISSION

First Respondents

THE HONOURABLE JUSTICE BARRY
JOHN MADDERN, PRESIDENT OF
THE AUSTRALIAN INDUSTRIAL
RELATIONS COMMISSION

Second Respondent

MEDIA, ENTERTAINMENT AND
ARTS ALLIANCE

Third Respondent

Ex parte -
THE HOYTS CORPORATION PTY.
LIMITED, DELARENE PTY. LTD.
and RAMPTON PTY. LTD.

Prosecutors

MASON CJ

BRENNAN J

DEANE J
DAWSON J

TOOHEY J

GAUDRON J
MCHUGH J

TRANSCRIPT OF PROCEEDINGS

AT CANBERRA ON TUESDAY, 3 NOVEMBER 1992, AT 10.16 AM

Hoyts(2)

3/11/92

MR R. MERKEL, QC: If the Court pleases, I appear with my

learned friend, MR L. KAUFMAN, for the applicant.
(instructed by Mark G. Caldwell)

MR J.W. NOLAN:

May it please the Court, I appear for the

second respondent, in matter M27 of 1992, the Media
and Entertainments Arts Alliance and the same
organization ia the third respondent in M43.
(instructed by Slater & Gordon)

MR D.J. ROSE, QC:

If the Court pleases, I appear with my

learned friend, MR T.J. GINNANE, for the
Commonwealth Attorney-General in both matters.
(instructed by the Australian Government Solicitor)
We would seek leave to intervene, if the Court

pleases, on behalf of the Minister for Industrial
Relations in the second matter, to put a matter concerning the statutory construction of the
Industrial Relations Act, as it concerned the
Minister.

MASON CJ: Are you making that application for leave to

intervene at this stage?

MR ROSE: If that is appropriate, Your Honour, but I could

make it at a later stage if that would - - -

MASON CJ: At a later stage - yes, very well.

MR K.H. BELL:

If the Court pleases, I appear with my

learned friend, MR C.J. LOVELL, on behalf of the
employer respondents to the award sought to be set
aside in the proceedings relating to No M43 of 1992
and I seek leave for those employer respondents to
be joined as respondents in those proceedings.
(instructed by Holding Redlich)

MASON CJ:

Mr Merkel, do you have anything to say about that

application?

MR MERKEL:

No, we consent to the joinder.

MASON CJ: You have leave to intervene, Mr Bell.

MR BELL:

The companies are named at appeal book 75.

MASON CJ: Yes. Mr Merkel.

MR MERKEL: If the Court pleases, as I understand the

matter, is the court proceeding to deal with the
notice of motion first and separately to the second
matter, because they are unrelated, and if I could
hand up the outline of our submissions in respect
of the clause 31 matter that relates to the interim
award.

Hoyts(2)

3/11/92

MASON CJ: Yes.

MR MERKEL:

I also hand up two cases which were not on our

list of authorities which we will be referring to.

MASON CJ: Yes, Mr Merkel.

MR MERKEL:

If Your Honours please, the notice of motion was

taken out at a time when the award had not been
printed and published in accordance with the
provisions of the Act, but shortly after that date

it was printed. We have had delivered to the Court
the award in its printed form. The motion concerns
the validity of clause 31 which provided - it is at
page 372 of the application book and at page 26 of
the award that we had sent to Your Honours.
Clause 31 provided that there was to be no

change in terms and conditions of employment of any
employee of Hoyts Corporation without leave of the
Full Bench of the Commission and that no employee
of the Hoyts Corporation was to have his or her
employment transferred to any other employer in the
Hoyts Group, again without the leave of the
Full Bench of the Commission.
There are a number of grounds on which we

challenge the power of the Commission to make an
award in those terms. The first and primary ground
is that the award is not a matter pertaining to the
relations of employers and employees as such, but
is a provision relating to the powers, functions
and capacity of the Commission and in fact purports
to confer a new jurisdiction upon the Commission.
I have handed up to Your Honours R v Kelly,

Ex parte State of Victoria, (1950) 81 CLR 64. I
wanted to refer the Court to a passage from the
joint judgment at page 80 where Their Honours were
discussing the question of the lack of jurisdiction

under section Sl(xxxv) in respect of the common
rule and cited with approval what Mr Justice Isaacs

had said. Can I just read the passage. It is at
point 4 where His Honour said:
"It is not open to the grantee of the power
actually bestowed to add to its efficacy, as
it is called, by some further means outside
the limits of the power conferred, for the
purpose of more effectively coping with the
evils intended to be met." Then follows a
passage which concludes the the well known and
often quoted saying that "you may complement,
but you may not supplement, a granted power."

We say that the vice of clause 31 is described within that passage and by that passage.

Hoyts(2)

3/11/92

GAUDRON J: It would be all right though, on that argument,

if it were a blanket prohibition and it were left
to the parties from time to time to apply for a
variation of the award. It would have the same
effect.

MR MERKEL:

Your Honour, that may attract other problems

which would be dealt with on other grounds, but we
say that is not the issue, but if there was a
blanket prohibition, that would raise itself a
question as to whether that was within the power of
the Commission to prevent and settle an industrial
dispute, because the blanket prohibition would
descend down to any change in conditions of any
employment of any employee and we would say that
that would not be an industrial matter, for other
reasons which we have set out in our grounds. In
other words, they would be solving future disputes
which had not yet arisen on a personal and

individual contractual basis. So that would offend
other heads, and we would have some doubt - - -

GAUDRON J: But that would be with respect to the relations

of employers and employees, would it not?

MR MERKEL:	We would say, Your Honour, it would be with respect to the relation of the employer with an
employee, and that is another ground we rely on.

GAUDRON J: Yes.

MR MERKEL:

But at the moment, we would say it is most

unlikely that the Commission would make such an
award, but if it did, that would attract its own
problems, but that is not the problem in the

present case. The attack at the moment on this
ground is on the "without leave of the Commission"
part, and I wanted to take Your Honours, if I
might - - -

DAWSON J: What are you objecting to, 31.1, 31.2?
MR MERKEL:	Yes, Your Honour. Although, we would say that

if we are right on 31.1 and 31.2, the whole of
clause 31 would go, and that is the only attack to
the interim award, because 31.3 and 31.4 are not
severable from the first two limbs, they in fact,

assist it to operate. The majority judgment in the
Shell case dealt with this very problem.

DAWSON J: Could I just ask you what is this ambit of what

you say about 31.1? You would not dispute that
with the award in place lesser conditions cannot be
imposed upon an employee because the employer is
required by law to provide award conditions.

MR MERKEL:	Yes, Your Honour.
Hoyts(2)	3/11/92

DAWSON J: Well, what does it prevent you from doing?

MR MERKEL:

It prevents you, Your Honour, from changing any

conditions whether governed by the award or not.
In other words, there are many aspects of
employment - - -

DAWSON J:	Or whether they are an improvement on the conditions which the award requires.
MR MERKEL:	We would say on its proper construction it would

apply to an improvement. Clause 29 would have to
be read together with clause 31, but we say
clause 31 appears to be the dominant clause that
says that any change to any employment conditions
requires leave of the Full Bench. But in answer to
Your Honour's question, clause 31 goes far beyond

award conditions. It covers the manner in which
work is performed, the place at which work is
performed. For example, one of the problems in the
present case arose because of a request to an
employee to transfer his projectionist functions
from one cinema to another, and that was said to be
a change in the terms and conditions of his
employment, and that was not a matter covered by
the award.

DAWSON J:

Why do you read 29 as subject to 31?

MR MERKEL:

Because, Your Honour, 29 says that the award

does not limit the right to provide improved wages
and conditions, but we say that the vehicle by
which that would have to occur is clause 31. That

provides the mode by which that is to occur.

If we

are wrong on that then, Your Honour, clause 31
would not operate to prevent improved conditions,
but they would operate to prevent changed

conditions which may not be improved.

It is the

blanket.

GAUDRON J:

It is directed to taking people out of the award and putting them in staff positions with different

conditions, is it not?

MR MERKEL:

Not so, Your Honour.

We would say that if it

was no more than a variation application it could
have that effect, but it is not limited in any

shape or form to award conditions. It is any
conditions. In other words, the problems that have
arisen at the cinemas, just looking at it in a
practical sense, come up from the instance I gave
Your Honours, a change of the location at which an employee performs work. Another change is a
function of the employee, where the ticket sellers
were to have additional functions, and these are
matters which are not dealt with under the minimum conditions in the award. If the provision were no

Hoyts(2)

3/11/92

more than a variation procedure, that would be
quite a different situation, but we say it is not.
It goes far beyond that, and the effect of it is that there can be no change in the functioning of
employees without access to clause 31, and we say
that in that blanket way the Commission has given
to itself a power which we say is not within its
jurisdiction to give.
Even if it were a variation, we say that the

Act deals with variation applications, an award
cannot, within itself confer, in effect, an ongoing
role of the Commission in supervising terms and
conditions of employment. That would relate to
future matters, not resolving a present dispute.

DAWSON J:

If you take that the central aim of both .1 and

.2, it is to prevent the sort of thing that Justice
Gaudron was talking about - that is, avoiding the
award conditions by transferring a person to a
position where they do not apply, or by
transferring the appointment to a subsidiary
company which is not a respondent to the award.
That is the aim of the two - central aim - is it
not?

MR MERKEL:

Your Honour, one could accept that that was one

of the objects but the object was not fulfilled,
but -

DAWSON J: You say it goes wider than that.

MR MERKEL: It goes wider, yes, Your Honour.

Had it been

carefully framed to, in effect, protecting award
conditions there may be no problem with it. But it
is not so framed, and that is the reason why we
have the problem with it. It has given rise to
practical problems which have, in effect, meant
that Hoyts cannot really function in respect of
day-to-day activities without going to the
Commission to authorize matters that have got

nothing to do with the award as such.

DAWSON J:	Can you give an example of that?
MR MERKEL:	The example of the projectionist being moved

from one venue to another. The other example is a
ticket seller being required to sell confectionery,
and matters which have got nothing to do with the

award. The award does not seek to govern all these
aspects: it governed only minimum terms and
conditions. And on an ongoing basis with a large
cinema organization there are numerous situations
where terms and conditions of employment need to be
changed, which may not be beneficial or may not be
detrimental.

Hoyts(2)

3/11/92

TOOHEY J:

Would it extend, Mr Merkel, to matters that bear

upon the safety conditions under which work is
carried out?

MR MERKEL:

It could, Your Honour, it could go to any

matter, but because it is not in any way limited,
we say that it covers everything and that is the
central vice of it. But we say that there is an
underlying problem, in any event, in the Commission
attracting this jurisdiction; in effect,

supervising an award on an ongoing basis. We say
that is not the function of the Commission and,
indeed, this Court considered, we would say, an
almost identical claim in the Shell case. If I can

take Your Honours to it: Re Amalgamated Metal
Workers Union of Australia; Ex parte Shell,
66 ALJR 645.
The claim in question was set out at page 647,

it was the third claim. That was a claim which
prevented any modification of the fund that could
result in the payment to member companies out of
the fund, and there were two legs to it, but the
exception which was relevant to the present case is
that the payment could be made if it was with the:
prior written consent of such proportion of
the Members ..... or an order of the Commission
approving such an arrangement, revocation or
modification.

Your Honours considered that limb of the order of the Commission, having found in the majority
judgment that the claim did relate to an industrial

matter. So we say, in principle, it is not
distinguishable from the present problem, terms and
conditions of employment being an industrial
matter. What Your Honour said, at page 651, at
paragraph A, that the matter was an industrial
matter or a claim relating to an industrial matter,

then, at paragraphs Band C: To the extent that the second part of the third claim is concerned with the powers of
the Commission, it is not a dispute about a
matter pertaining to the relationship between
employers and employees (R v Portus; Ex parte

City of Perth). However, that aspect of the
claim is severable from the claim that
modification be approved by a proportion of
employees to be determined by arbitration.
We say that the authority that was referred to,
namely that it relates to powers of the Commission,
is Reg v Portus; Ex parte City of Perth,
(1973) 129 CLR 312. If I could take Your Honours
to that case, we say that the principle that was

Hoyts(2)

3/11/92

summarized in Shell is set out at some length in a
number of judgments in Portus.
Portus related to a log of claims that sought

to have a right of appeal in respect of termination
or dismissal in circumstances where it was harsh,
unjust or unreasonable and the right to appeal was

held to confer a new power on the Commission. We
say it is indistinguishable from having to get
leave of the Commission.
May I take Your Honours firstly to the

Chief Justice Sir Garfield Barwick at page 315, where His Honour at point 7 said:
The subject matter of the demands, in my
opinion, was the capacities and functions of
the Conciliation and Arbitration Commission, a
matter regulated by the Act and not a proper
subject for treatment by dispute or award.

And we would say the same would apply if there was
in effect an internal variation procedure by going
back to the Commission from time to time to deal
with changes. We say that would suffer the vice
that His Honour referred to - - -

GAUDRON J: But would it really, because there is an

unstated variation procedure already existing? I
mean, it is always open to the parties to apply for
a variation.

MR MERKEL:

Your Honour, that is so, and that comes up under

section 113 of the Act, but the cases do suggest
that where there is a variation, that is either in
further settlement of the original dispute or
creates a new dispute and the jurisdiction for
variation is derived from the further settlement or
the creation of a new dispute. But we would submit
that an internal procedure, where the Commission
had an ongoing supervision of terms and conditions

of employment, would offend the principles that we have talked of, but we do not need to go that far
in the present case because this is not a matter of
variation, nor is it limited to variation.
Mr Justice Menzies - - -

GAUDRON J: But is it doing any more than the Commission

could do under the original dispute?

MR MERKEL:

We say it is, Your Honour, because of the

problem identified earlier, that it is really
descending into the individual and personal
contractual relationship of the employer with an
employee.

Hoyts(2)

3/11/92

GAUDRON J: But that does not seem to answer the question, does it? The real question is, what is the ambit

of the original dispute, and what orders are
reasonably incidental to the matter raised by that
dispute; not whether or not the Commission may do
certain things. If the Commission is saying no
more in that clause than it might in effect do
without saying it, what is the problem?

MR MERKEL:

The problem, Your Honour, in a more practical

sense is set out under the headings in our third
paragraph of our submissions, that it creates
problems under each of the four separate heads in
our outline, each of which has been the subject of
separate consideration by this Court on a number of

occasions. Can I just indicate one that stands
out: because the power is so wide and unlimited,
without reference to criteria, it in effect confers
upon the Commission an unfettered, uncontrollable
discretion as to how changes are to be supervised.
We need not say, for our case, that it is

impossible for the Commission to give itself some
power of leave in respect of a matter that would
require a variation. That would be a difference in
form, not substance, but we say this provision goes
far wider than that.

GAUDRON J: But the first question is, is it not, what· might

the Commission do pursuant to the original dispute?

If it is doing no more than it might do pursuant to
the original dispute, why is it giving itself
power?

MR MERKEL:

Your Honour, because of the very reasoning underlying the decision in Shell, that there was a

dispute about payment out of the fund without
consent of the members, without leave of the

Commission. Leave of the Commission supervised and

gave the Commission an ongoing role in respect of

payment.

The dispute was as to payment; that was

an industrial matter.

Your Honours found that the

supervisory role of the Commission which could have

followed the same path as Your Honour is putting to

me in the present case, it could have just been a

blanket prohibition.

GAUDRON J:

No, it could not, because what happened in Shell

was that there was a decision that that aspect of
the demand did not give rise to an industrial
dispute. It may have given rise to a dispute; it
did not give rise to an industrial dispute. Here
one assumes that there is a dispute which gives power to the Commission or which authorizes the Commission to do certain things, although one does

Hoyts(2)

3/11/92

not know it because your argument seems to take off
at some other point.
But making the assumption that the original

dispute enables the Commission to do certain
things, the question is - there are two questions.
Firstly, does clause 31 give to the Commission
power to do things, or purport to give to the
Commission power to do things, or express power to
do things, which it had in any event pursuant to
the original dispute? That is the first question.
If it does, why do you then say it is a conferral
of - an attempt to confer power?

MR MERKEL:

Your Honour, because the original dispute

related to a log of claims for minimum conditions
of employment over a whole range of matters, terms

and conditions of employment. It did not and could
not validly say that there could be no change of
employment in any employment condition without
leave of the Commission.

GAUDRON J: But above, it said there shall be no change,

full stop.

MR MERKEL: It might have done. It did not, but if it did

do so, Your Honour, we would say that that still
would not be a log that would give the Commission a
discretion to in effect have an ongoing role to
allow changes only by supervision.

GAUDRON J: But there are in fact two logs of claims here,

are there not?

MR MERKEL:	Yes, Your Honour.
GAUDRON J:	One, the employers, and one, the unions, and for

all practical purposes they put every matter
relating to employment in issue, when viewed
together, do they not?

MR MERKEL:

We would say that is a fair description.

Every

term and condition of employment, but for the
purpose, Your Honour, of having an award that
stipulated the minimum terms and conditions of
employment like any log, and it is
indistinguishable, we would submit, from the issue in Shell and Portus. If it cannot be validly made
the subject of a claim in a log, it cannot be
validly made the subject of a provision in the

award. We would say it can be tested by saying,
"Could you have a claim saying that you shall not
change conditions of employment without leave of
the Commission?"
We say that is exactly the vice that

Their Honours were dealing with in City of Perth

Hoyts(2)

3/11/92

that I am taking Your Honours to and I was about to
take Your Honour to the answer given by
Mr Justice Menzies at page 319 in the City of
Perth. His Honour, at the bottom of 318, said:
Any dispute to which such a claim -

and this was to give a right of appeal for a
dismissed worker -
might give rise is about the way in which a
difference which may happen in the future
between an employer and a dismissed worker
shall be settled. What is sought is an award
by the Commission that the Commission should
itself settle any such difference. Such an
award would not be in settlement of an
industrial dispute; ie a dispute as to matters
pertaining to the relations of employers and
employees. It would relate to the powers to
be exercised by the Commission. Furthermore,
the power of the Commission stems from
legislation under s.51 (xxxv) of the
Constitution and is not subject to extension

by awards made by the Commission itself. The
Commission cannot add to its statutory power
to hear and determine industrial disputes.
Still less can it give itself power to settle
differences which are not of that character.

DAWSON J:

I can understand that, that there is not an

industrial dispute; there is not any dispute about

future conditions at the moment. The award is
promulgated, but why can there not be a dispute as
to the means by which future disputes will be
settled?

MR MERKEL:

Your Honour, there may be a dispute about the

means of resolution of a future dispute in the
sense that there might be grievance procedures and
the manner in which they are to be dealt.

DAWSON J: Exactly.

MR MERKEL: But, Your Honour, the grievance procedure could

not allow, in effect, a broad-ranging jurisdiction
to be conferred on the Commission to resolve any
future dispute, because that would not relate to
the resolution of a past dispute.

DAWSON J: But it is not only broad-ranging jurisdiction.

If there is a dispute as to the means by which future disputes will be settled and the Arbitration
Commission is brought in as the means, then that is it. There is no limit on the jurisdiction of the
Arbitration Commission to settle an industrial dispute, a current industrial dispute, by

Hoyts(2)

3/11/92

exercise judicial power Other than, it should not arbitration. No limit.

MR MERKEL:

As long, Your Honour, as it is settlement in

prevention or settlement of an existing dispute.

DAWSON J: But if the current dispute is about the means by

which you settle future disputes, that is the
current dispute and the arbitration settles that
current dispute by providing a means, what is wrong
with it?

MR MERKEL:

Your Honour, we say that providing a procedure

for settlement is one thing; conferring an
unfettered unlimited jurisdiction on the Commission
to settle is another.

DAWSON J: If it can confer jurisdiction on a grievance

committee as a means, why can it not confer
jurisdiction, as you put it, on itself?

MR MERKEL:

Because, Your Honour, the grievance committee

decision would not have the statutory force of an
award. The vice here is that there is a power on
the Commission on an ongoing basis to exercise an
unfettered jurisdiction which has statutory force.
A grievance procedure would not occur, Your Honour.
It would really provide a procedure to - - -

DAWSON J:

Its force would come from the award. The force of its procedures, the force of the Arbitration

Commission in this situation would come from the

award.

What is the difference?

MR MERKEL:

Your Honour, we say that the authorities in this

Court would accept everything that Your Honour has
put up till the last step, and that is to confer
the jurisdiction on an ongoing basis on the
Commission to resolve a matter in dispute, because
Shell, we say, contained the same problem. City of

Perth is exactly that problem.

DAWSON J:	But in that case, in City of Perth, they are saying this was not in settlement of an industrial dispute and therefore it was simply attempting to give powers to the Commission, but if giving powers
to the Commission is in settlement of an industrial
dispute, why should you not?
MR MERKEL:	We say, Your Honour, that what has occurred in

the present case is not settlement of an industrial
dispute; it is giving power to the Commission.

DAWSON J: That is a different point.

MR MERKEL:

That is the point that we make, Your Honour,

that this does not settle anything.

Hoyts(2)

3/11/92

DAWSON J:

Do you concede that if you did have an industrial

dispute as to the means of solving future
disputation arising under the award, then you could
settle that dispute by giving the Commission or any
other body jurisdiction to take certain action?

MR MERKEL:

We would stop short of the very last step,

Your Honour. We would say these authorities would
say that would be conferring a new power on the
Commission, and we say that is where the principle would stop.

TOOHEY J: But is that not the problem, Mr Merkel, whether

in fact this clause 31.1 purports to be aimed at
disputes arising under the award, because on a
reading of the subclause, it seems to work in this
way, that the Commission says there are terms of
employment which this award now regulates, there
are other terms of employment or conditions of
employment which the award does not regulate but as
to which there can be no change without the leave
of the Commission. Is that a legitimate way of
reading clause 31.1 or not?

MR MERKEL:

We would say, Your Honour, that if clause 29

overrides clause 31, that would appear to be
correct.

TOOHEY J: Well, I do not know that you need worry about

clause 29 except in the sense that we are talking
about employment conditions no less beneficial than
those prescribed by the award. But I was inviting
you to look at conditions of employment that were
not regulated by the award, and clause 31.1 would
appear to be wide enough to embrace those sort of
conditions.

MR MERKEL:

Yes, that is so, Your Honour.

TOOHEY J: But the subclause then says, in effect, while the

award does not regulate this particular employment
condition, nevertheless, there can be no change in
it without the leave of the Commission.

MR MERKEL:

And that, we say, Your Honour, is precisely the

subject-matter dealt with in these cases, that you
shall not do something - for example, in Shell it

was identical, "You shall not pay out of the fund

without leave of the Commission". There was a

dispute about payment out of the fund.

The

resolution of it was sought to be a provision in

the award that there be no payment without leave of

the Commission. That would be a matter -

TOOHEY J: Yes, but that is a different situation, is it

not? I mean, here, 31.1 may not be looking at a
dispute at all in a sense that the employee and the

Hoyts(2)

3/11/92

employer may be in agreement as to a change in
employment conditions not regulated by the award.
Nevertheless, if clause 31.1 operates according to
its terms no change can be effected without the
leave of the Commission.

MR MERKEL:

Yes, Your Honour, and we say that is a good example of how far it goes, that the employer and

· employee could be in agreement. And yet it would
be a breach of the award to change the terms and
conditions of employment without going and getting

leave of the Commission. We say that is an
example - - -

TOOHEY J: These questions are not aimed demolishing your

argument, but rather inquiring whether the argument
is not a different one to the one that you are
putting up based on Shell where there was an
industrial dispute.

MR MERKEL:

Your Honour, it is possible that we have run

into some difficulty because we have, in effect,
fragmented the argument as a series of different
steps. But it is the accumulation of the matters
we complain about that demonstrate why and how it
is that a new power is conferred.

DAWSON J: But really, maybe it is your fragmentation which

obscures the argument. The fact of the matter is
that there is a real dispute about the fact that
rightly or wrongly it is seen that Hoyts avoids the
conditions of the award by transferring employees
to another position, or by making them employees of

a subsidiary company. Now, in order to deal. with
that situation about which there is a genuine
industrial dispute this is seen as the solution,
and it is in settlement of that dispute that this
particular clause is put into the award, unlike the
situation in the Shell case where the particular
clause which was put to one side did not involve an
industrial dispute even though the majority held

the other matter did.

MR MERKEL:

Your Honour, the short answer we would give to

what Your Honour puts is that a settlement of that
aspect of the dispute to avoid the problems in the
cases we have identified would require some
criteria to be stipulated which showed that it was

giving effect to what Your Honour identified. It
is the blanket prohibition, irrespective of whether
it is avoidance of award conditions or not, that

really gives rise to the problem, Your Honour. We
say that one cannot read as much into it as
Your Honour has, because if it said that you shall
not transfer employment so as to result in an
employee getting less than the award conditions, I
could accept and understand what Your Honour puts.

Hoyts(2)

3/11/92

But that is not what it says. It just says you
shall not transfer employment irrespective of the
effect and irrespective of the reason.

That is why we say that it goes too far. there were criteria, it could meet what Your Honour

If
has put.

DAWSON J:

I understand, it goes beyond what is necessary to

settle an industrial dispute?

MR MERKEL:

Beyond what we say is capable of being a

settlement of an industrial dispute, because it
does not settle it.

DAWSON J: It settles something else?

MR MERKEL:

Yes, Your Honour.

I did not want to delay too

long on Portus, but Mr Justice Gibbs, as he then
was, discussed this question of power at 324 to 325
and in these passages His Honour imports some of
the other grounds we rely upon. But while I am at
that can I take Your Honours to it. At 324 His
Honour at point 8 says:
In effect what was then sought was a provision
giving the Commission an arbitrary power to
order relief and leaving entirely to the
Commission the determination of the matters to be considered in the exercise of the power.
The exercise, by a body not a court, of a
discretionary power of an arbitrary kind, not
governed by any objective tests or standards,
is not, in my opinion, the exercise of
judicial power ..... The question however is
whether a dispute arising from a claim that a
power of that kind be conferred on the
Commission is a dispute as to an industrial

matter. I cannot accept that such a dispute
would be rightly characterized as one as to

concerned; it goes beyond that, since what is the terms of the employment of the employees sought is to confer power on the Commission.
Looked at from one point of view, the dispute
may appear to be as to the employer's power to
dismiss or duty to reinstate in employment,
but since it is intended that no criteria
should be laid down by which the extent of the
power or nature of the duty could be
ascertained, it seems to me that what is in
truth sought is an extension of the powers of
the Commission.

Then at point 8 at page 325, His Honour says: Similarly the Commission cannot, by making an
award, increase its own powers or jurisdiction

Hoyts(2)

3/11/92

and a demand that it should do so would not
give rise to an industrial dispute. In short,
a claim by employees upon their employers that
the powers, functions or jurisdiction of the Commission should be enlarged is not a claim
as to an industrial matter.
His Honour then goes on at page 326 to repeat
what His Honour said at point 1, where His Honour
talks of the increase in the powers, and then
His Honour said:
If the Association were right in its

contention that there has been raised a
dispute as to whether a proposed dismissal
should not become effective until it has been
confirmed by the Commission (or a board
appointed by the Commission) I would still
consider the dispute would not be as to an
industrial matter.

His Honour Mr Justice Stephen discussed the

question at page 328 where, in the middle
paragraph, His Honour said:

In my view the Association's claim is not
as to any industrial matter; it is, rather, a
claim to the exercise by the Commission, in the future, of a new jurisdiction involving the exercise of judicial power and this for the purpose of the settlement of future
industrial disputes necessarily lacking any
inter-State quality.

His Honour then, at point 9, says:
The subject matter of the dispute must, I
think, be characterized not as one concerning
the employer's duty to reinstate in employment
but, rather as a dispute as to a proposed new
function or jurisdiction to be conferred upon

the Commission. The remedy sought by way of
reinstatement cannot control the
characterization of the subject matter of the
dispute -

Then His Honour talks, at page 330 - again, this is
one of our other grounds but just while I have
Your Honours at the case I can mention it. At
point 3, His Honour said:
There are, moreover, narrower and more

specific grounds for denying to the claim the
character necessary to give rise to an
industrial dispute. It seeks to create
machinery for resolution of future disputes,
disputes which will inherently involve, on the

Hoyts(2)

3/11/92

one hand, an individual ex-employee and, on

the other, his former employer. Such disputes
will not be ones extending beyond the limits
of any one State -
If I could leave Portus, and take Your Honours briefly to the Tramways Board case, which was
relied upon by Their Honours in City of Perth, that
is, Reg v The Commonwealth Conciliation and
Arbitration Commission and Others; Ex Parte The
Melbourne and Metropolitan Tramways Board, (1965)
113 CLR 228, and we say that this case raised the

same question. The second demand which is set out
in the headnote is that the:
employers shall not without the consent of
the ..... Employees' Association or by order of
the Commissioner ..... require an employee to
operate on his own, a bus on routes on
which ..... had been operated by two or more
employees.

The discussion of this power aspect is at 247 to
248 by Mr Justice Taylor. His Honour, at point 9
said that:
The demand did not seek a specification by an
award of the circumstances in which, or the
conditions upon which, an employee might be
called upon to operate a one-man bus; it
simply sought an award which would leave it to
the Association to say yea or nay in any
particular case, and providing that in the
event of disagreement each particular dispute
should be settled by the Commission.

And then His Honour went on to say that these matters related to the powers of the Commission at
page 248 and at -

DEANE J: Mr Merkel, can I interrupt you for a moment? This

is, no doubt, my lack of understanding of the
background, but where did 31.1 come from? Are
there reasons of the Full Bench?

MR MERKEL:	Yes, Your Honour, the material which I had not taken Your Honour to, discloses that what had
occurred was that Hoyts had been changing some
terms and conditions of employment, and the Commission directed that that not occur, then what
occurred is there was an argument before the
Commission as to what procedure should be followed and - - -
DEANE J:	I followed that and I reached the stage where at

page 212 there was an interim order which really
highlights your argument in a more stark form, but

Hoyts(2)

3/11/92

all I was asking you for, briefly, was where, or
what does one look at to get that interim order
translated into 31.1?

MR MERKEL:

Your Honour, what then occurred is there was a

hearing in the Commission at which counsel for
Hoyts indicated that they would offer an
undertaking in respect of not changing, but would
not agree and said it was beyond power to make it a
term of an award. The union sought it to be a term
of an award and as a result clause 31 emerged, and
that was the order that was made as part of the
interim award.

DEANE J:

I see, and you are going to refer us at some stage

to the reasons that the Full Commission gave, or if
you can just give me a reference to them that will
serve my purpose.

MR MERKEL:

Yes, Your Honour, I will give you a reference to

the transcript where the argument was put, and if I

can summarize the references to where the argument
was put and where the Commission gave its reasons.

I was finally going to page 256 of

Mr Justice Menzies, where His Honour at point 3
made the point that His Honour made again in
City of Perth, where His Honour said:
The Commission cannot, by making an award to
settle a dispute of that character, give
itself power to make orders for the settlement
of local disputes.

And that is what really happened here:
Another way of putting the same point is to say that a demand for an award in terms presupposing the power of the Commission to
make orders for the settlement of industrial
disputes outside its constitutional competence

cannot give rise to a dispute within the
Commission's constitutional competence.

And His Honour also said that the Commission cannot
work out a settlement in the running at the bottom
of the page.
Can I move then to paragraph 3 of our

submissions. There are a number of grounds which
are wrapped up, in effect, in the primary ground to
show why it is an additional power given to the
Commission.
The first is that the practical effect and the

legal effect of the clause is to involve the
Commission, in effect, in a supervisory role in the

Hoyts(2)

3/11/92

management and control of the business of the
employer.
In Manufacturing Grocers' which I will not take Your Honours to, the Court commented on the
problem of the Commission, in effect, having an
ongoing role in respect of superannuation, and that
was at page 354 in the Manufacturing Grocers'
decision.
Your Honours in Re: Cram did criticize the

past approach of saying, because a matter involved
management it would not relate to the relationship
of the employer and employee as such, and in Cram
which is at 163 CLR at pages 133-8, but
particularly at page 136, Your Honours discussed
that matter in a joint judgment but at page 135,
Your Honours said, at point 6:
Many management decisions, once viewed as the
sole prerogative of management, are now
correctly seen as directly affecting the
relationship of employer and employee and
constituting an "industrial matter".

Your Honours then gave the example of manning in

which there may be a legitimate interest. And then
at page 136 at point 7, Your Honours rejected the
suggestion:
based on the remarks of Barwick C.J. in
Melbourne & Metropolitan Tramways Board, that
managerial decisions stand wholly outside the
area of industrial disputes and industrial
matters.
Now, what we say in the present case is that

the present case is an example of where it cannot
be said that there is a legitimate interest of
employees as such, in any change to any term and

condition of any employee, irrespective of the

circumstances. We say that, notwithstanding what
Your Honours said in Cram, this is a case where it
is an intervention in what, in terms, is properly
the subject of managerial prerogative.
Now, we say it is a question of degree,

clearly, but at the end, looking at Cram's case,
what we say to Your Honours is that there is a line
and we say that when it is a condition such as
clause 31, without any reference to any criteria,
it is an intervention in the prerogative of
management which does not, in its terms, constitute
a matter in which the employees could have a
legitimate interest in. we say that decisions to that effect are found in the Tramways Board case,
Reg v the Conciliation and Arbitration Commission;

Hoyts(2)

3/11/92

Ex parte Melbourne and Metropolitan Tramways Board,
115 CLR 443, where in passages at pages 456 to 457,
in the joint judgment of Justices Taylor and
Menzies, Their Honours, at the top of 457, citing
with approval Mr Justice O'Connor in Clancy, said: "If once we begin to introduce and include in
its scope" ( ie the scope of the Act) "matters
indirectly affecting work in the industry, it
becomes very difficult to draw any line so as
to prevent the power of the Arbitration Court
from being extended to the regulation and
control of businesses and industries in every
part.".

We say that that is what, in substance, has occurred here. Finally, in the Federated Clerks'
Union v Victorian Employers' Federation,
(1984) 154 CLR 472, at page 489, Your Honour the
Chief Justice said, by reference to the Tramways
Board case - at the top of page 489:
a connexion resting on an indirect effect or
consequence being insufficient for this
purpose, a demand by employees for something
of a management or managerial nature has no
relevant connexion with the relationship of
employer and employee and is not an
"industrial matter".

We accept the modification that Cram may bring to this subject-matter, ~hat matters previously
thought to be managerial may, over time, become a
legitimate interest of employees as such. But we
say that the present clause offends that principle

at both levels. The supervisory role and the
nature of it, we say, offends the principle.

MASON CJ: But just before you leave that, I think it is a

mistake to look at that passage at 489 in my

judgment as if it was a definitive and exhaustive

expression of my opinion of this question. You
have got to look at the passage at 491 where I say,
eight lines down:
Whether the concept of management or
managerial decisions can be sustained as an
absolute and independent criterion of
jurisdiction, even in the context of the
Conciliation and Arbitration Act, is an important question that may require future consideration.

MR MERKEL:

Yes, I accept that, Your Honour, and, indeed,

Cram's case was that consideration.

Hoyts(2)

3/11/92

MASON CJ: That is right. This is a step along the road to

a subsequent reconsideration of the substantial
question.

MR MERKEL: That is so, Your Honour.

MASON CJ: Therefore, you have to put behind you a number of

the expressions that you find in the earlier cases.

MR MERKEL:

I accept that, Your Honour, and, indeed, I went

to Cram first to say that Cram is not authority for
the proposition that matters that are managerial

constitute an industrial dispute. They can
constitute an industrial dispute, subject to the
test of the legitimacy of the interest of employees

as such in the subject-matter. We say that this
clause transcends that for the reasons we have
identified.
The second aspect in paragraph 3 of our

outline that we would identify as that which has
been referred to in Portus and the Tramways Board,
namely that the Commission's power, without
reference to criteria, is capable of arbitrary and
uncontrollable exercise.
I have taken Your Honours to the City of Perth

and the Tramways Board. Could I just Your Honours
briefly to a passage which deals with that in the

Toohey and also His.Honour Mr Justice Wilson in

joint judgment of Your Honours Justices Dawson and passage from Your Honour's judgment is at page 326.

Wooldumpers, again, related to the reinstatement question and, at point 3 at 326, Your Honour said:
Both principle and authority require a

distinction to be drawn between a claim for
conditions relating to the dismissal or
reinstatement of employees generally and a
claim that a specific individual be reinstated

in employment, not by the application of any
predetermined standard, but merely to deal
with the one instance. Each claim is of a
different kind and the one does not embrace
the other.

We say that the claim in the present case relating
to individuals, as it necessarily must, without
reference to any predetermined standard, suffers
the vice that Your Honours identified at page 326.
The next ground which we rely upon is set out

in 3(c) of our submissions, that the clause creates
machinery for the ad hoc resolution of future
disputes of a local nature inherently involving an

individual employee and employer. We say that

Hoyts(2)

3/11/92

those matters are dealt with in Portus and the
Tramways Board case and we say that that must be
so, because we are looking to the future in respect
of matters that have not yet arisen which are not
capable of definition as to the circumstances in
which they arise, and therefore one is not dealing
with a matter that is necessarily linked to a
settlement or logically can be linked to a

settlement of the original interstate dispute. We
say that they are ad hoc matters arising in a
particular instance which in themselves are not
capable of giving rise to an industrial dispute.

GAUDRON J: But again we come back to what is the

subject-matter of that dispute, do we not? It is
all very well to say this, but unless we can
identify that subject-matter with some precision,
they are just statements in the air.

MR MERKEL:

I think I agreed with Your Honour that the

subject-matter of the original dispute constituted
by the two competing logs of the employer and the

employee covering many but not every condition of

employment.

GAUDRON J: Is there another dispute of the kind that

Justice Dawson put to you, which I think you
accepted, being a dispute as to whether the
employer, whose activities are interstate, should
engage in practices which have the effect of taking
people outside the operation of the award.

MR MERKEL:

Your Honour, we would say that is too broad, because one has to look at a dispute in terms of

parties.

We say that on a narrower level, one

could discern from what has occurred between the

parties is that there was a dispute as to the terms

and conditions that should govern employment by

Hoyts and then later the two subsidiaries, Delarene

and Rampton, at Hoyts cinemas and that dispute

related to the matters the subject of the logs of

claims by the union and the employers which did not

cover every condition of employment.

We say that that dispute still is no more than
a dispute as to the terms and conditions of

employment, Your Honour. We say it does not become
a free-ranging dispute about matters that are not terms and conditions of employment the subject of the logs.

GAUDRON J:

Is it a term and condition of employment that

conditions not be changed?

MR MERKEL:

No, Your Honour.

It can be a term and condition

but it was not, we say, a subject-matter of either

Hoyts(2)

3/11/92

log, that there be no change of any term and
condition of employment.

GAUDRON J: It is a vice that is around all the time that

you have to find something in a log. I am talking
about a factual dispute and I am going back to the

last time the parties were in Court. I seem to
recollect that there may have been no finding, but
the whole assumption underlying that debate was
that the parties were in disagreement about the
employers' practices which had the effect of taking
persons covered by the award outside the award.

MR MERKEL:

Your Honour, that was resolved when Delarene and

Rampton were roped into the award. The question
thereafter has been: what are the terms and
conditions of employment? It has not been,
Your Honour, a matter of transferring employees to
other companies in respect of those matters. We
say it has not been a matter of taking employees
out of the award, Your Honour; it is a matter now
that goes to a much broader subject-matter. That
is why I said to His Honour Justice Dawson before
that a different question may have arisen if the
clause had been limited by reference to criteria,

but this award was not so limited. We say that it
is not as broad as Your Honour puts it to us.
But in any event, we say that it still suffers
from the vice, and an example, Your Honour, is what
was referred to in the two cases of future disputes
of a local nature, the question of a projectionist
transferring to a different location, or a ticket
seller being required in lax time to sell
confectionery. These are matters which have
nothing to do with the overall dispute of employees
as such, Your Honour. They are just instances of
what may occur in a workplace on a daily basis in
the future, and that is what we say is part of the
vice.

That really takes us to the last item in

paragraph 3, that what really this does is regulate
the private matter of the individual contract

between the employer and the employee. In other
words, because it applies to each and any contract
it really is a private matter, and we have set out
authorities to that effect which I need not take
Your Honours to, which make good the proposition
that it is not within the scope of the Commission
to deal with private contracts on an individual
basis which we say this clause has done.
The final ground which we put forward in

paragraph 4 is that being as broad ranging as
clause 31 is, it prohibits changes irrespective of
the wishes of the two persons involved, and

Hoyts(2)

3/11/92

irrespective of the relationship between the change
and the function of the Commission in preventing or
settling an industrial dispute. I could accept
that that ground would not be made out if there
were criteria that related it to particular
instances, but we say that being as broad ranging
as it is it offends that principle which we say is
beyond the scope of the Commission. Now, that may
be, in effect, an accumulation of all the other
points that we put forward, but we do say that for
those reasons the clause is beyond the power of the
Commission.
Can I finally before concluding see if I can

deal with Your Honour Mr Justice Deane's question.
The decision appears at page 313 to page 314, but can I give Your Honour transcript references of

where the matter was dealt with in the hearing. It
is all in volume two. Could I possibly take

Your Honours quickly through the passage. The
affidavit sets out the history of the matter, and might I say in a way that puts the history in the
fairest light it could as our opponents would see
it. Then the question of an award came up, and at
page 237 counsel for Hoyts at line 20 said -
that the Commission should not make either of
the orders sought -

which were by the union. At 247 it was said that it was beyond jurisdiction and the Tramways Board
case was referred to at line 40. At line 30 on
page 280 counsel for Hoyts indicated that if the
Commission went ahead an made an order Hoyts would
reserve its right -

to test the validity of that order.

An undertaking was offered as an alternative to an
award at line 20 at page 305, and then at 313 to
314 at line 48 the Commission, Mr Justice Boulton

giving the reasons for the Full Bench indicated at
the last three lines:
In all the circumstances we have decided that the provisions of the undertaking will be included as a term of the interim award -

and that was what was opposed by Hoyts.

DEANE J: What was the difference as to content between the

undertaking that your clients offered and the
clause of the interim award actually made?

MR MERKEL:

I do not think there was any relevant difference, Your Honour. In other words, what was

Hoyts(2)

3/11/92

offered as a resolution was, in effect, an
undertaking to the Commission.

DEANE J:	Was it for a limited time?
MR MERKEL:	I think the undertaking was referred to,

Your Honour, at page 305 -

MASON CJ: There is no difference, is there?

MR MERKEL:

No, I do not think there is any difference,

Your Honour. I have not checked the wording but I

think it was in terms of the undertaking. I do not
think there was any difference, and I do not think

it was offered in terms of point of time. The
significance, Your Honours, was that of course the
undertaking, if not adhered to, would activate a
jurisdiction of the Commission to make an award,
given the problem that then arises. The problem
that was opposed by Hoyts was that to make it a
term of the award would attend breach of the award
with the sanctions of the Act, including the
penalty provisions. That was opposed, Your Honour,
and, indeed, it was similar in that sense to the
problem that this Court considered in the Thompson
Holdings case.
It is on part 2 of our list of authorities.

If I can just mention it to Your Honour. Thompson
Australian Holdings v Trade Practices Commission,
148 CLR 150, where Your Honours held that
undertakings given to the Federal Court could not
enlarge the jurisdiction of the Federal Court. We
say that the fact that an undertaking may be given
to the Commission cannot, in effect, confer upon
the Commission a jurisdiction to make an award in
terms of an undertaking by the mere fact that it
has been given.

DEANE J: Could I just follow it a little bit further.

Would it be unfair to say that the problems of
construction of clause 31 are on your head because
they flow from the undertaking which your client
proffered, or would it be more fair to go back to
the interim order on page 212 and say that the
undertaking was a little less Draconian than what
the Commission had already done in its interim
order?

MR MERKEL:

I am sorry, Your Honour.

I think the order at

page 212, Your Honour, was the form of order that
the unions proposed. Could I just check this - it
may have been that that set the pattern of the
proceeding. Could Your Honour just excuse me for a

minute? I may stand corrected, but I believe that
what occurred is the order was proposed in terms of
page 212 by the unions. In the contest, counsel

Hoyts(2)

3/11/92

for Hoyts indicated that they would give an
undertaking but it should not be part of the award
and then the Commission determined it would be in

the award. So to answer Your Honour's question, it
was within our control to narrow it, but the
realities were that this was the proposal of the
union which the Commission acceded to.

DEANE J:

So that the answer you would give is the one that

is more favourable to your client?

MR MERKEL:

Yes, Your Honour.

And we would say, in any

event, when it comes to a question of an award
beyond the power of the Commission, if we are right
on the grounds in our notice of motion, the
circumstances we have outlined in our affidavit
would not disqualify us from relief as a matter of
discretion in the circumstances of the present
case, because the effect of what was done was not
something we acceded to, it was something we
opposed.

BRENNAN J:

Mr Merkel, the power that is conferred, or

purportedly conferred, by 31.1 is conferred not
upon the Commission eop nominee but upon the Full
Bench assigned. Are they personae designatio with the powers therein purportedly conferred, or is this a purported conferring of power on the
Commission?

MR MERKEL:

We say, Your Honour, it is a conferring of power on the Commission constituted by the three members

hearing the particular matter, which is identified.

But we say that it is not in terms on the

Commission other than by reference to the

Commission as constituted in that matter. But that

may change, Your Honour. In other words, it is a

power on the Commission, dealing with that matter
from time to time. There are provisions in the Act
that enable members of the bench to change in

certain circumstances.

BRENNAN J:

I suppose that is a matter of construing 31.1,

is it not?

MR MERKEL:

Yes, Your Honour.

BRENNAN J: What is the meaning of the words "and others" at

the end of it?

MR MERKEL:

I think, Your Honour, there are a whole series

of C numbers, by reference to the proceedings that
have arisen, from time to time, which were all
being handled, at that time, by the one Full Bench.

BRENNAN J:

I see.

Hoyts(2)

3/11/92

MR MERKEL:

There were a series of dispute which have

occurred which all got C numbers when there was a
notification to the Commission and the Full Bench
were dealing with those various matters. So, for
those reasons, it is our submission that the relief
sought in the motion should be granted on the
grounds set out in the motion. If the Court
pleases.

MASON CJ: Thank you, Mr Merkel. Yes, Mr Nolan.

MR NOLAN:

May it please the Court, may I hand up my outline

of submission?

MASON CJ: Yes.

MR NOLAN:

Thank you, Your Honour.

Before going to the

outline, it might be desirable just to pick up some
of the history of this matter since it has not been
canvassed in any detail. To give Your Honours some
idea of the flavour of this ongoing dispute, of
which the interim award, was, in our submission,
really one necessary step along the way in the
ultimate resolution of the - not just dispute, but
a series of disputes, might I refer the Court to
page 205 of the appeal book and this perhaps
answers the question raised by Your Honour
Justice Gaudron regarding the particular
circumstances that gave rise to the interim award
which have to be seen, in our submission, very much
as a part of the ongoing dispute between the
companies and the union with respect to this issue
of the companies transferring within them employees
of the Hoyts Corporation so as to take those
employees away from the pre-existing award coverage
to which Hoyts are bound.
Now, it is to be seen that in that context -

and we will go to some more of the history in a
moment - after proceedings that had then spanned a

couple of years before the Full Bench of the Commission, Mr Livingstone, then the Federal
Secretary of the Australian Theatrical and
Amusement Employees Association, which organization
has now become part of my client by virtue of an
amalgamation of that union and two others, wrote to
the presiding member of the Full Bench and, at
page 205 of the appeal book there is the letter
dated 12 May this year where Mr Livingstone said
this to His Honour Justice Boulton:
Your Honour will recall that on 22 May 1991 a
statement and directions were issued by a
Full Bench constituted by your Honour, Deputy
President Marsh and Commissioner Fogarty,
which considered matters raised by ATAEA and
TMA -

Hoyts(2)

3/11/92

and I should explain there, that TMA was the other
union of the theatre managers that was also
involved in the disputes -
pertaining to attempts by the above and
associated companies to alter the terms of
employment of a number of employees.
I attach a copy of the statement and
directions.
You will recall that the directions required that the "Hoyts Corporation Pty Ltd or any
other companies in the Hoyts Group should not,
unless leave of the Commission has been
obtained, take any action to transfer the
employment of the employees of Hoyts
Corporation Pty Ltd to any other company in
the Hoyts Group."
We are advised that a number of employees of the Hoyts Corporation Pty Ltd have been
approached to sign contracts with either
Delarene Pty Ltd or Rampton Pty Ltd, without leave being sought.

And just pausing there, they are, of course, the
two subsidiary companies that were not bound to the
theatrical award and were the subject of the
interim award and roping-in award proceedings.
Mr Livingstone continues:
in our view these actions by the company are
in clear breach of the directions issued by
the Full Bench on 22 May 1991.
Accordingly, we believe that the option
canvassed by the Full Bench in its statement
of 21 May 1990 that of " ... making an order in

these terms" should be exercised. We would
respectfully seek that the Commission, at its

next hearing of this matter, issue an order so
as to protect the pre-existing conditions of
employment of employees effected by the
company's unilateral action.

So that raised squarely, in our submission, the
issue that led to the interim award being made, but
it cannot be seen as something that sprang in an

isolated way out of the blue; it was very much a
part of the ongoing dispute proceedings between the
union and the companies about their proper award
coverage of those subsidiary companies to which
employees of the award-bound company were being

transferred. So Mr Livingstone wrote to His Honour
Justice Boulton and he enclosed - and it is at the
next page in the appeal book, page 206 - a copy of

Hoyts(2)

3/11/92

that earlier statement that was issued by the Full
Bench of the Commission. That was reproduced, as
you will see, in the form of an order of the

Commission, a printed order, Print J7883. The
statement said this:
We have considered the submissions of the

parties regarding the future course of these
proceedings.

Then perhaps to interpolate again, it should be
recalled that this was on 22 May 1991, and the
proceedings about award coverage had been going at
that stage since late 1988. The bench went on to
say this:
We have also considered the submissions

concerning the statement made by a Full Bench
of the Commission on 21 May 1990 -

that is almost a year earlier -
about the proceedings before that Bench
involving the Hoyts Group of companies and the
unions. In many respects, the present
proceedings arise out of the concerns by the
unions that the Hoyts Group is not complying
with that statement.
The statement made by the Full Bench

includes the following:
"We are concerned at developments whereby new
contracts have been entered into between the
Hoyts Group and individual managers and

projectionists over the last month. We are
also concerned that there would seem to be a
number of provisions in the contracts which
are capable of being misconstrued and may have
been misconstrued and that the making of the
contracts may be seen as an attempt to

pre-empt the decision of the Commission in
these proceedings.
We consider that the status quo should be
maintained during the course of the
proceedings and state that, in essence, this
was the basis on which the Commission in
November 1989 set the timetable for the

hearing and determination of the matters. We
also consider that no further action should be
taken by the Hoyts Corporation to vary the
employment status or the basic terms and
conditions of employment of its staff during
the course of proceedings. In the event that
Hoyts considers that it is necessary to vary
any existing contracts (eg in relation to

Hoyts(2)

3/11/92

annual salary reviews), the Company may seek
leave from the Commission.
If necessary, we would be prepared to consider making an order in these terms during the course of the proceedings or making an interim
award."
Having heard the submissions of the

parties today, we are seriously concerned that
the terms of the statement may have been
breached. Although all the circumstances
relating to possible breaches have not been investigated by the Commission, we consider
that it is appropriate that we reiterate the
requirements made of the parties by the other
Full Bench.
I should indicate there that was the Full Bench of
which Deputy President Polites was a member, and
you will recall some proceedings came before this
Court about his decision to disqualify himself and

then he went back on the bench. So there have been
slightly differently constituted benches. They go
on:
This is necessary in order to ensure that
there is a proper basis for the continuation
of proceedings in the Commission relating to
the employees of the Hoyts Group and to allow
the Commission to carefully and quickly
inquire into and investigate the present
dispute and all matters affecting the merits
and right settlement of the dispute.
In the circumstances we have decided to

make the following directions:
The Hoyts Group of companies is to comply with
the Full Bench statement of 21 May 1990.

In particular, Hoyts Corporation Pty Ltd is
not to vary the wages or conditions of
employment of any staff subject to the
proceedings in the Commission and employed by
the Hoyts Corporation Pty Ltd as at
9 April 1991 without the leave of the
Commission. Hoyts Corporation Pty Ltd or any
other companies in the Hoyts Group should not,
unless leave of the Commission has been
obtained, take any action to transfer the
employment of employees of Hoyts Corporation
Pty Ltd to any other company in the Hoyts
Group.

BRENNAN J: What is the authority for making a direction in

those terms?

Hoyts(2)	31	3/11/92
MR NOLAN:	The statutory authority, Your Honour, is to be found perhaps l(t). Section lll(l)(d) gives the	in section 111 of the Industrial Relations
Commission, in relation to industrial disputes, the power to:

give a direction in the course of, or for the
purposes of, the hearing or determination of
the industrial dispute -
and perhaps (t), if that is not sufficient, would
cover the matter because it is a comprehensive
power that allows the Commission to:
generally give all such directions, and do all
such things, as are necessary or expedient for
the speedy and just hearing and determination
of the industrial dispute.

BRENNAN J: Are they not procedural powers?

MR NOLAN:	They may be procedural powers in some respects but they also, in my submission, are powers that go
to affecting substantive rights. For example, if
one looks at lll(l)(f), there it can be seen that
an award can be set aside. That would, in my
submission, go to the exercise of a substantive and
not merely procedural power because one's rights
can be just taken away by virtue of an order under
section lll(l)(f).

Also, of course, the Court is familiar with
section lll(l)(g) which is a section that provokes
a lot of litigation before the Commission and that
deals with not just procedural matters but with
very important substantial and substantive rights
that may or may not be created by the Commission in
the exercise of its award-making power and a
discretion as to whether or not a federal award
ought to cover a particular disputant.

So, in our submission, we would say that there

is no real challenge to the power under lll(l)(d)
and, in any event, none has been taken, as we
understand it, by the applicants in - - -

BRENNAN J: Perhaps it does not matter very much but is

there any difference between a direction then and
an interim award?

MR NOLAN:

Perhaps there is not, at the end of the day, but

so far as the definition section in the Act is concerned, "award" in section 4 is defined as:

Hoyts(2)

3/11/92

an award or order that has been reduced to
writing under subsection 143(1), and includes
a certified agreement -
There does not appear to be a separate definition
of "direction" but it seems to be that the
Commission can convert its direction into an order.

GAUDRON J:

The trouble with your reliance on paragraph (t)

is that nothing seems to have been speedy in this
matter at all. In fact, the whole order seems to
have been on the basis that this will enable a
leisurely determination of the matters in issue.

MR NOLAN:

Yes, well as outsiders, I suppose that might be

the view that could be taken, but I am sure the
parties themselves, or at least the members of the
Commission were determined to move with as much
expedition as they were able to muster in all of
the circumstances, especially in proceedings such
as these which were very hotly contested as you
will see by reading the transcript, and where every
point - well perhaps not every point, but a lot of
points were argued very strenuously, the Commission
having to deal with the nitty-gritty of all these
aspects of the claim, perhaps could be excused for
taking longer than perhaps would be desirable to
dispose of the disputes.

DEANE J: While you are being asked about that, I notice

from clause 4 that this interim award was initially
seen as a very limited status quo operation.

MR NOLAN: That is right.

DEANE J: But, according to clause 4 of what we have been

given, the interim award has expired. What has
happened?

MR NOLAN:

The position is that the proceedings that

continue, the interim award would nominally expire

but continue by force of the Act to have force, and
I understand that position to be still the position.

DEANE J:

I follow you. So, the position is that clause 4

is just a nominal thing in that unless something
happens, the interim award continues indefinitely.
Is that so?

MR NOLAN: That is certainly my understanding, Your Honour.

But the intention was, in our submission, that the Commission would put this in place very much as an interim step pending the resolution of the
substantive award proceedings that were given rise
to by the serving of the respective logs and so on.
Those proceedings have still - - -

Hoyts(2)

3/11/92

DEANE J:

I do not want to delay you, but could you give me

a reference to a section of the Act that says an
award continues in force after it expires according
to its terms; only at a convenient time, Mr Nolan.

MR NOLAN:

No, I think I have got it.

Mr Merkel says it is

148. Ever since they reorganized this Act it has
been difficult to find your way around at times,
but section 148 says:
Subject to section 113 and any order of the Commission, an award dealing with
particular matters continues in force until a
new award is made dealing with the same
matters.

So, plainly the parties could apply to have the
award revoked, and Hoyts could apply to do that at any time, given that the nominal term of the award
has expired. If circumstances had altered it would
be an easy matter to have the award altered or
revoked.

DEANE J: So, stated in the award that it only remains in

force until 20 August 1992 is not a contrary order
of the Commission on the accepted wisdom?

MR NOLAN:

Yes, I think the view is taken that the terms

stated in the award instrument itself does not have
the effect of - - -

MASON CJ: Well subsection (3) may bear on that, Mr Nolan.

DEANE J: Yes, that seems to make it fairly clear.

TOOHEY J:

Mr Nolan, could I just ask you this: in light of

the background that you just described to us, would
clause 31.2 of itself have been sufficient to meet
the union's concerns?

MR NOLAN:

No, Your Honour, because the first subclause deals with the change of employment conditions

within the existing employment of Hoyts
Corporation, and possibly the dismissal of the

employee.

TOOHEY J: Yes, I appreciate that, but is there any reason

then why 31.1 is framed in terms of employment
conditions being changed, which would suggest
something much wider than those aspects of a
relationship that are covered by the interim award
itself?

MR NOLAN:	Yes.
TOOHEY J:	I mean, if employment conditions meant no more

than those conditions regulated by the interim

Hoyts(2)

3/11/92

award, then presumably you would not need the
subclause because they could not be changed
adversely to an employee without the leave of the
Commission.

MR NOLAN: Well, perhaps not necessarily, Your Honour. The

award would not set in concrete the particular
tasks given to the employee, for example, so it
would be possible even within the framework of the
interim award for an employer suddenly to decide
that a projectionist should do, for example,
booking clerks' duties in the cinema from time to
time; whereas, ordinarily under the pre-existing
award and under the way the award would be applied
it would not be usual for an employee who was
employed as a projectionist, for example, to

undertake some of those other duties. One of the
very real issues in this case was the extent to
which, if at all, the employer should be given open
slather to vary the duties of the employees
concerned.
Of course, the union's argument was that was a

matter really that ought to be dealt with in the
course of the award proceedings, but while those
award proceedings were on foot attempts were made
not just to transfer employees - that was the main complaint - but also to present employees with the
direction to change the mix of their duties.

TOOHEY J: Yes, I understand that answer. It carries with

it its own difficulties, I suppose, because it
tends to give the expression "employment
conditions" a really open-ended meaning which then
in turn prompts the question, "Well, is 31.1
necessary to resolve the industrial dispute with
which the Commission was presented?" In other
words, "Might a more limited type of provision in
31.1 have been sufficient to meet the union's
demands or to resolve the dispute arising from
those demands?"

MR NOLAN: Yes, I think not, if I can say that again, simply

because part of the union's complaint, as I
understand it, was that it was not just the
transfer of employees to the subsidiary company,
but it was the presentation to existing employees
of Hoyts with the demand that they had to change

their duties in their existing employment. So
there were two issues involved, if you like, in
relation to the change of employment, and obviously
that was something that the Commission took into

account in the way it framed its award; and it was
obviously something that was of concern to all of
the parties because after all, the employer itself
gave an undertaking in terms of what ultimately
became the award.

Hoyts(2)

3/11/92

So it was clearly an issue that was alive so
far as everyone was concerned. It was just that
the employer said, "Well, it is not something that
you can make as an award, but in the interests of
the proceedings we will give the undertaking", and
of course, it was the union's complaint that the
undertaking had been given really two years before,
virtually the same undertaking, but in the union's

view the undertaking had been breached. Of course,
evidence of that is not just present in
Mr Livingstone's complaint.
There is a separate dispute notification that

went to the Commission from the South Australian
secretary of the then Theatrical Employees
Association concerning the duties of booking clerks
being changed, and that was a dispute notified to
the Commission a little earlier than

Mr Livingstone's letter. I think it was in
February 1992, and that is to be found also in the
appeal documents at page 205 - I am sorry, that was
Mr Livingstone's letter. Perhaps I can come back
to that.
But there is, in any event, a separate notice

from the South Australian secretary saying, "Look,
the employer is breaching the undertaking because
it sought to change the working arrangements for
the booking clerks at one of the theatres in
Adelaide." So we do not understand the point to
have been taken that there is no interstate
dispute. But we have a national dispute between
the national union and the national cinema chain, and within the parameters of that ongoing dispute there are eruptions, if you like, at various

locations when the employer makes demands on the
employees.

TOOHEY J: But as a matter of construction of 31.1 it would

range much more widely than the sort of
illustrations you have given us, and would appear

to preclude a variation, admittedly beneficial to the employee, taking it right outside the scope of
particular duties to be performed and, say, going
to overtime or other payments.

MR NOLAN:

But overtime would be regulated by the award, I

would think, Your Honour. I suppose the union
could be excused - - -

TOOHEY J: But only if it was more beneficial. 31.1 would

have the effect, would it not, of requiring the
leave of the Commission before any condition,
whether beneficial or otherwise, could be
incorporated in the conditions of employment?

Hoyts(2)

3/11/92

MR NOLAN: Well, I suppose the Commission, like the union,

would have to turn its mind to the likelihood that
such an eventuality might occur and the union,
perhaps in the circumstances, could be excused for
being a little sceptical about the practical
possibilities of benefits being conferred on

employees just gratuitously by the employer in the In any event, as a matter of jurisdiction I

context of these disputes.
would not have thought that that would be something
that would be beyond the Commission to regulate
because, after all, awards known as paid rates
awards have been a feature of the Commission's
award-making powers and functions accepted by the
parties for decades - I would think at least since
1975 when the national building trades construction
award was made, and such an award was made
specifically at the request of the parties and on
the basis that that represented a maximum as well
as a minimum code for the employment of the
employees employed under it.
So far as the award impinges on the contract

of employment and governs aspects of the contract
of employment, I would not have thought it would be
an objection to the jurisdiction of the Commission
for there to be an award made that was
comprehensive as to the terms and conditions of
employment of an employee, so it really depends on
the particular award that is made and the way it is
framed as to whether or not it is co-extensive with
all aspects of the contract of employment. It is not a matter that I would suggest would go to the
jurisdiction of the Commission to make a particular
award of that kind.

BRENNAN J:	Mr Nolan, do we have a finding of dispute on which this award is based?
MR NOLAN:	The finding of dispute does not appear to have

been made in a separate way, because I think the
notification has been treated rather as a
notification along the way in the original

substantive dispute proceedings. Mr Livingstone,
for example, cites C No 30172 of 1989 in his letter
of complaint to the Full Bench, and in the earlier
statement the Commission cite C No 30681 of 1991
and C No 31055 of 1991 as the original disputes
which gave rise to the statement and directions.

BRENNAN J: At all events, we do not have any finding of

dispute in these books.

MR NOLAN:	No, there is no finding of dispute in the appeal books, and I do not understand the point to be
taken that the original dispute findings or any of

Hoyts(2)

3/11/92

them do not support, for example, in the
Wooldumpers sense, the award. If the point is
taken, it is not taken so far as to say that an
examination of the original dispute findings
reveals that the later award is not incidental to
the original dispute, and certainly, as Your Honour
quite rightly points out, there are no dispute
findings in evidence that would support such a
contention were it to be made.

GAUDRON J: But there is no doubt, is there, that there

counter logs of claims from the union and the
employer?

MR NOLAN:

No doubt at all.

GAUDRON J: And that those logs of claims involved what

might be called the classification structure
pursuant to which employees would be employed in
the sense that it would involve an issue as to the
duties to be performed by persons paid particular
sums of money.

MR NOLAN:

No doubt at all as far as I am concerned. Every

issue was put in the melting pot, as it were.

GAUDRON J:	So far as the union was concerned, its request for directions and orders was to ensure that
nothing was done which forced a particular
classification structure on the Commission or on
the union.

MR NOLAN:

That is right.

They did not want the company's

unilateral actions to pre-empt what would be the
subject of the award proceedings. That is really
the flavour of - - -

GAUDRON J: In a sense, even if the employer and an

employee, or even the employer and the union,
agreed about a particular thing, that might have
the effect of tying the Commission's hands as to

the classification structure ultimately to be
introduced in the industry.

MR NOLAN:

I think that is the view that was taken and the

union, while ever it resisted the demands of Hoyts,
was really saying that all these things were in
issue, and Hoyts was saying one thing: they wanted
to transfer employees, adopt a different
classification structure; the union was saying,
"No, the existing award ought to prevail", and
really everything in between was up for grabs and ultimately the interim award was made. But I have
to emphasize it was made as an interim award, and
very much has to be seen as one step along the way
and the ultimate resolution of these bitter
differences between the parties.

Hoyts(2)

3/11/92

BRENNAN J:

Mr Nolan, I am still a bit lost. There was an

existing award which prescribed the terms and
conditions of the several classes of employees

employed by Hoyts. Then Hoyts' subsidiaries
offered other contracts of employment to Hoyts'
employees and some of them accepted.

MR NOLAN:

Yes.

BRENNAN J: That was followed then by an extension of the

award and I think roping in of these subsidiaries
so that they too became bound by the award?

MR NOLAN:

No, no, Your Honour, the real issue in contention

was whether or not and to what extent those
subsidiary companies ought to be bound by the
pre-existing award, and Hoyts and its subsidiary
companies resisted that. That was really the issue
because their view was - - -

BRENNAN J:

Be it so, were they then made to be bound by the

award?

MR NOLAN: Ultimately, no, not to the pre-existing award,

ultimately bound to that roping-in award that you
have got which is an interim award that bound
Hoyts, Delarene and Rampton. But the original
theatrical award, which was the original award that
bound Hoyts, was the one that the companies
resisted having extended to the employees of the
subsidiaries.

BRENNAN J:

Does this award, so far as it applies to

Delarene and Rampton, prescribe the terms and
conditions of employment parallel with the terms
and conditions prescribed by the original award?

MR NOLAN:

No, it does not.

It has some of the terms and

conditions but does not have all of them.

DAWSON J: It is not really a roping-in award, it is a

new - - -

NOLAN:

Yes, it is a fresh award that is made as an

interim step in the ultimate determination of the
extent to which the old award, or some variation of
it, ought to be made as an ultimate award or a
final award binding these parties.

BRENNAN J:

If they are bound by the terms of the award, 31

is then an additional term which is intended to
cover - - -

MR NOLAN: Hoyts.

BRENNAN J:

- - - everything that is not now prescribed by

the award otherwise more expressly, is that right?

Hoyts(2)	39	3/11/92
MR NOLAN:	Yes.	So it is to, we would say, preserve the

status quo so far as the Hoyts' employees are
concerned pending a final award being made at the
conclusion of these, albeit, already long-running
proceedings but proceedings that one hopes will be concluded some time in the not too distant future,
and a final award will be - - -

MASON CJ:	Am I right, Mr Nolan, in ascertaining, from what you said a moment ago, that the purpose of 31 is to prevent the employer and the employees from
agreeing upon a course which would result in their employment by different entities and in different
classifications on different terms and conditions,
all because it is thought that agreements to that
end might ultimately inhibit the Commission in the
exercise of its power to determine classifications for the industry?
MR NOLAN:	Not, I would think, solely or even substantially

because of the concern you raise, Your Honour. I would have thought there are wider concerns about
the propriety and the fairness, if you like, the
industrial fairness of pressing contracts and other
alternative employment relations on the employees
concerned in the industrial environment that the
Commission is presented with.
I think the Commission may well have concerns about the manner in which these transfers are
affected and the industrial fairness of them and it
is really that reason that motivates,
substantially - - -

MASON CJ: Are these wider concerns reflected in what the

Commission says in the decisions that are contained in the application books?

MR NOLAN:

So far as there is a decision in relation to the

award, I was going to go to that. That is really
to be found at page 312 of the appeal book.

say, before reading this, of course, what is said Can I
in the decision has to be gauged in the light of
all the material that has been put before the
Commission following Mr Livingstone's letter and up
until the day on 20 May when the decision is made.
So the decision is one, as you will see, that is
made in transcript; it is not the subject of a
separate lengthy discourse on all the issues in
dispute.
His Honour Justice Boulton announces the decision after the luncheon adjournment on 20 May
and he says this:
we have considered what has been put and we
now announce the following decision. In the

Hoyts(2)

3/11/92

course of the proceedings the Media
Entertainment and Arts Alliance applied for
the making of an interim award roping in
Delarene Pty Limited and Rampton Pty Limited
to the Theatrical Employees (Cinema and
Drive-In Industry) Award 1983, and an order
relating to the circumstances dealt with in
the directions given by the commission in
May 1990 and May 1991.
In response to these applications, Hoyts
proposed that an interim award be made based
on the draft award proposed by the MEAA in the
proceedings, exhibit S46, the 1983 award and
the current employment conditions of employees
of Delarene and Rampton. In response to the
parties' proposals the commission made the
following statement on 19 May -
and there is a quote from that earlier statement.
At the conference convened by the bench there
was considerable progress made towards an
agreed position regarding the contents of a
proposed interim award covering the employees
of the Hoyts Group of companies. However, a
number of issues remained outstanding and on
20 May the commission heard submissions
relating to these issues.
Having considered all the submissions, we have
decided that as agreed between the parties an
interim award covering the employees of The
Hoyts Corporation Pty Limited, Delarene Pty
Limited and Rampton Pty Limited will be made.
We note that there is a large measure of
agreement between the parties as to the terms
of the interim award. In relation to the
outstanding issues we have reached the
following decisions.
First, the interim award will be based upon

the draft provided by the MEAA and marked as
exhibit S47 as amended in the proceedings,
subject to the changes which we have
determined. Second, the award will come into
operation on 20 May 1992 and shall remain in
force until 20 August 1992. Third, clause 4
of the union draft relates to the preservation

of existing conditions. The interim award
will provide that:
Actual rates of pay and conditions applying to
individual employees at 7 May 1992 shall not
be reduced as a consequence of the coming into
operation of this award.

Hoyts(2)

3/11/92

In determining this clause we have had regard,
inter alia, to the material and submissions
presented to date in these proceedings
relating to the statement and directions made
by a full bench of the commission on 22 May
1992. Fourth, clause 9 of the union draft
relates to annual leave. We have decided that
the union provision regarding ttfull paytt shall

be included as part of this clause. On the
material presented we understand that this
reflects a current award provision and the
current practice by the Hoyts Group.
Then they go on to deal with annual leave loading, and talk about superannuation benefits and
then they go on to say, at about line 38:
At this stage we are prepared to include in
the interim award the provisions of part 2 of
the union draft but to apply only to employees
of The Hoyts Corporation Pty Limited as at the

date of this decision. We do not propose to
incorporate like provisions relating to
employees of Delarene and Rampton in the
interim award. This will mean that the
existing classification structure and rates of
pay for these employees will continue pending
the finalisation of matters before the
commission or until further order of the
commission.
Seventh, we note that as part of the proposal
for an interim award put forward by Hoyts in
exhibit D140 the employers indicated that they
would be prepared to have included as an
appendix to the interim award an undertaking

by them. We have considered the terms of the

proposed undertaking and the submissions of
the parties relating to the undertaking. In
all the circumstances we have decided that the
provisions of the undertaking will be included as a term of the interim award. The clause
shall provide as follows:

And there they recite what is ultimately made as
the award, and they go on to say:
Subject to the abovementioned matters an
interim award will be made ..... The MEAA is to
prepare a draft order -

and the parties can have recourse to

Deputy President Polites to settle the order. So

the awards made can be seen very much in the context of these ongoing proceedings and, of
course, the benches have been careful to restrict
the operation of that particular clause to the

Hoyts(2)

3/11/92

Hoyts Corporation people and not to extend it to
the other subsidiary employees.
So, it is not - just getting back to what

Your Honour the Chief Justice has said, it is
certainly not evident from what the Commission say
that they were preoccupied that the changes made
could inhibit their award-making power, I do not
really think that they proceeded on that basis at
all, but I think rather they were concerned to just
crystallize the status quo where it then lay and,
after all, this was only something that gave
expression in award terms to undertakings that had
been given over the three-year period by the
employer, admittedly undertakings that the union
had complained about having been breached.

DEANE J:

Mr Nolan, was the effect of this interim award

that the employees of Hoyts Corporation ceased to
be protected by a general award by which they had,
up to this time, been protected; or, did the
general award continue to apply to them?

MR NOLAN: Well, I suppose - I do not want to avoid the

question, but can I say this, that even if it could be assumed that both awards could be read together,
at the end of the day, if the general theatrical
award could not be considered to continue by force
of the award, the conditions contained therein
would have been continued by force of the interim
award that was made, because it was those
conditions, and perhaps other over-award conditions
that -

DEANE J: Well, that is what I was wondering. One does get

the impression that clause 1 could have been
designed to ensure that the protection of the
general award was effectively continued.

MR NOLAN:	Yes.
TOOHEY J: Well, does not clause 32 of the interim award

have something to say about that?

MR NOLAN:

Yes, I think 32 really picks it up in terms, so

that it picks up those other clauses from the
general theatrical award - if I can call it that -
applying only to the - - -

DEANE J:

While I am interrupting you can I ask the

question that I was really wanting to ask and that
is, is there any received wisdom in the Commission
about what "employment conditions" mean? I mean,
if, for example, the employer introduces a better
grade of toilet soap to the minimum that has been
agreed, is that a change in employment conditions?

Hoyts(2)	3/11/92
MR NOLAN:	I suppose that is an extreme example, but why

could it not be seen as a change in employment
conditions, because if the reverse was the case and
the employer decided to suddenly do away with
toilet soap in the amenities blocks, well plainly a
dispute could come before the Commission about that
and it would be seen as a condition of employment.

DEANE J:

"Employment conditions", does, on your approach,

effectively mean the whole scope of the conditions
under which people work and not limited to
conditions laid down by an award or the terms in
the employment agreement.

MR NOLAN:	Yes, I think it would have to be seen as the broader conditions because there may well be, on a
local basis, many arrangements and conditions that
are conceded locally that are not the subject of the industry award.

TOOHEY J: But as soon as that is said, and it is perhaps

only going over the same ground again, it gives
rise to the problems of whether clause 31.1 is in
fact much wider than is necessary to resolve the
industrial dispute which was before the Commission
and which gave rise to the interim award; whether
something more limited in its wording may not have
been sufficient.

MR NOLAN:

I suppose something more limited in its wording

may have been appropriate if the circumstances of
the employment conditions were addressed, but in
these circumstances the employer was prepared at
least to give an undertaking in precisely the terms

that were later made into the interim award. And
so it was not as though the employer got up and
said, "Look, hold on a minute, we'll give an
undertaking broadly in these terms, but there are
really some important exceptions and we have to make them clear." There was no argument at the

level of the Full Bench about the scope of the
expression, if you like, it was simply whether or
went so far as to say that there ought to
not that ought to be translated into an award term. employers

be an appendix in the award. One wonders what
status that would have if the bench could not make,
in any event, an award in those terms.
May I add that once again it would not be

surprising for the Commission to, at least on an
interim basis, make a broad status quo interim
award referring to conditions because the parties
themselves, I would suggest, would have a pretty
good idea of what that term meant because every day
of the week they work under the conditions that are
preserved by the force of the awards.

Hoyts(2)

3/11/92

BRENNAN J: Mr Nolan, I am not sure I am following the

relevance of this. You are not putting it forward

on the basis that the prerogative writ should not
go because of the conduct of the prosecutor.

MR NOLAN:

No, we do not have to go that far, I do not think, Your Honour - - -

BRENNAN J: Then are you saying that the conduct of the

prosecutor confers the jurisdiction that otherwise
does not exist?

MR NOLAN:

Yes.

I think it would involve that second step.

We do not say that their conduct adds to the

jurisdiction of the Commission. We say the interim
award that was made is within the jurisdiction of
the Commission.

BRENNAN J: Then that is all that is relevant.

MR NOLAN:

Yes, yes, Your Honour.

GAUDRON J: Why is it within the jurisdiction? Is it

because of the power conferred by section 111 as
incidental to the arbitration power generally, or
is it because it is within the ambit and/or is
reasonably incidental to the issue raised by the
dispute?

MR NOLAN:

We would not disavow the first, but we would say

that it is comprehended by the second, for the
reasons I will go to now by reference to my
outline, if I may. Going to paragraph 1, we say
that the award made by the Commission - and that
was the subject of the demand in Mr Livingstone's
letter apart from any antecedent logs and so on,
and also has to be seen against the factual
circumstances from which it sprung - was directed
to the security of the employment and conditions of

the employment of the employees concerned. As
such, it was an award made in settlement of a
dispute about a matter which pertained to the
employment, that is the terms and continued
employment of the employees of the applicant.
I should interpolate there that perhaps the

focus has unnecessarily been attached to employment
conditions, but one of those conditions, in our
submission, would be the very employment itself.
So that no one would be dismissed without the leave
of the Commission in that interim period.

GAUDRON J:

Do we have to make an act of faith about what

was involved in the dispute?

MR NOLAN:	An act of faith?
Hoyts(2)	3/11/92
GAUDRON J:	On your submissions and on Mr Merkel's, you see

the subject-matter of the industrial dispute, then
you tell us what the award is about. Is there
common ground as to what the dispute was perhaps
about, the subject-matter of the dispute?

MR NOLAN:	The subject-matter of the dispute was the threat to employment of the employees of Hoyts by their imminent transfer to the other companies or by the
alteration, effected unilaterally, the union would
say, by the employer to their terms and conditions
in their existing employment.
GAUDRON J:	Was there a finding of dispute as to that matter

by the Commission, separate and distinct from a
dispute with respect to the cross logs of claims?

MR NOLAN:	Not as I understand it, nor do I understand the point to have been taken by the employers when
Mr Livingstone's letter came before the Commission.
It was simply subsumed in the antecedent disputes
created by the exchanges of the logs of claims, but
in any event we would say if one disregarded the
logs of claims, one sees abundantly here the
factual circumstances that would give rise to a
situation that would enliven the Commission's
jurisdiction.

BRENNAN J: Frankly, I do not see it, whether abundantly or

otherwise. It seems that there are employees of
Hoyts who are offered employment by third parties.
This is said to be some interstate industrial
dispute between the remaining employees of Hoyts, I
take it, and that employer?

MR NOLAN:

And the union.

BRENNAN J: Where is the interstate nature of that and what

is the industrial dispute characteristic of it?

MR NOLAN:

The industrial dispute, as I have already said,

is about alterations effected to the employment
conditions by the employer or by the employer's act
of requiring employees to transfer to another
employer not bound by the award. That is the

subject-matter of the dispute. The interstate
nature of the dispute is satisfied, we would say,
by - there is the actual evidence on the record
about occasions of this occurring in Adelaide as
well as nationally in terms of Mr Livingstone's letter, but that point was never taken, because
Hoyts is a national employer, it conducts cinema

chains throughout the nation. The award was a
national award.
The disputes about the movement from the award were conducted against the background of this

Hoyts(2)

3/11/92

desire on the part of the company being one that

extended to the whole of its cinema chain. The
point was never taken below by the employers that
there was never any interstate dispute, nor was it
taken when the subsequent steps arose, as I
understand it, in relation to the transfer of the
employment of these employees in the context of the
overall dispute proceedings or the award
proceedings.

BRENNAN J: Is this much clear, Mr Nolan, that there was a

new dispute which was settled by this interim
award?

MR NOLAN:

It does not appear that the Commission has turned

its mind to the actual finding of a new dispute in
terms of Mr Livingstone's letter. There does not
seem to be a dispute finding as such in the
ordinary way the Commission would make a dispute

finding. I think - - -

BRENNAN J:

We are in this position, are we not, that if

there was no new dispute, we must proceed on the
basis that there were cross logs of claims covering
all aspects of employment.

MR NOLAN:

Yes.

BRENNAN J: If there is a new dispute, we have no finding as

to the parties to that dispute, or as to its scope.

MR NOLAN:

Yes.

The Commission appears to have proceeded on

the basis that it could rely on the, and we would
say correctly rely on the antecedent disputes that
were created by the mutual service of the logs of
claims and demands about this very question of
whether or not the award ought to continue, or some
different arrangement ought to be adopted for the
employees of the subsidiary companies, and that was
squarely an issue, because the union itself had
sought the roping in of the subsidiary companies to

the parent award. And, as I say, I do not
understand myself that that point was taken about
the lack of interstate character of the dispute
below, either before the Full Bench when this
particular matter came on before it, or at any
earlier time.
It may be that the parties all proceeded on

the basis that the antecedent disputes comprehended what took place in the circumstances of the interim
award being made but, in my submission, that would
not be a rash assumption, having regard to the
history of the matter and the issues that were in
contest.

Hoyts(2)	47	3/11/92
GAUDRON J:	But that clearly is not right, Mr Nolan.	The

very minute Hoyts said you cannot make an award,
the question of the subject-matter of the dispute
was brought into issue albeit that Hoyts have not
taken a lot of trouble to deal with the subject-
matter of the dispute in its submissions today.

MR NOLAN:

The point was not taken that there was no

interstate dispute, as I understand it, relating to
the particular matter that gave rise to
Mr Livingstone's letter, for example.

GAUDRON J: Well relating to what matter? What matter?

What is that matter? That matter, yes, which
pertains to the relationship between employers and
employees.

MR NOLAN: Well, that letter said, and it harked back to the

earlier undertakings that were given in the
statement and directions and it said in the course
of these proceedings certain undertakings were
given by the employer about not transferring
peoples' employment, later on those undertakings
were converted into a statement and direction by
the Commission. A year later the union complains
that that statement and directions in that earlier
undertaking is about to be broken.
So, in my submission, it is something that really directly goes back to the issues that were
in dispute between the parties, the subject really
of the original contest. There was a bitter
dispute about the imminent transfer of employees,
the union said it was not proper and fair in the
circumstances to effect the transfer of employees
and this was really one incident along the way.

GAUDRON J: All right, that might take 31.2. But what is

the dispute that takes you to 31.1, about the
changed employment conditions, the persons, the
employees concerned, remaining in the employ of

Hoyts Corporation Pty Limited?

MR NOLAN:

That is really something that is canvassed in the

argument before Justice Boulton because what is
said - - -

GAUDRON J: Yes, but what is the dispute?

MR NOLAN:

The dispute is that the company is saying to

employees who would otherwise be Hoyts' employees
under the award, "You no longer perform duties just
as a projectionist", for example, "in the way that
the award conventionally operated. What we want
you now to do is go and do a mix of other duties.".
That was the complaint, as it arose, within Hoyts.
So the union's complain was twofold. It said, "Not

Hoyts(2)

3/11/92

only are they transferring people out of the
employment but they are requiring people who are in
the existing employ of the company to perform a
range of duties that hitherto were not performed by
those classifications under the award.
The Commission, impliedly, was satisfied that there was evidence of that kind of change as well

because it made the award the way it did. Indeed,
one of the arguments raised in the course of
these - - -

GAUDRON J: Where do I find that? Is there an equivalent of

the document at page 205 which is directed to
changing the duties of the employees of Hoyts?

MR NOLAN: It arises this way in the argument. There is a

passage where Mr Livingstone complains about not
just the transfer but the requirement upon
employees of doing different duties. That is met
by the company saying - and at one point this
argument was raised, it has not been raised today -
"Well, look, your rules", that is the union rules, "don't allow on their view, employees involved in
selling food and drinks to be members of the union.
We want to give these employees some of those
duties, therefore our argument is that they will
fall outside the rules of the union and you will
not be able to cover them anyway."
That is met in the course of argument by

Justice Boulton saying, "Look, wait a minute, that
exclusion in the rules is really directed to
persons employed exclusively in that capacity, and
not whose duties are incidentally involved in food
and drink dispensation, and so on". That argument
just trails off. It does not get anywhere at the
end of the day.

MASON CJ: Well, that seems to be true of a lot of what has

happened in this case.

MR NOLAN: That might be right, Your Honour, but the

Commission is still concerned about the fact that
there is a threat and that is revealed in the
transcript and the complaints made.

MASON CJ: But why did the Commission not make a finding of

dispute as it is required to do under section 101?

MR NOLAN:

I can only say, Your Honour, I imagine it did not

do that because it thought that the pre-existing
finding well and truly comprehended what they then
proposed to do. As I understand it there has been a complaint about the form of the award, but it has
not been said that if the award had been, on the
employer's view, regularly made in some way that

Hoyts(2)

3/11/92

achieved the same object, it would not have been
supported by the pre-existing dispute.

MASON CJ:

To the extent that there is a question before us

as to whether what is done is incidental to the
settlement of a dispute, I do not see how we can
answer that question unless we know precisely what
the dispute was.

MR NOLAN: That is so, of course, Your Honour, but I think

the terms of the dispute really are revealed by the
complaints made in the argument to the Full Bench
about what has occurred, and the correspondence
that harks back to that earlier statement, and one
can follow through the record to see that back on
21 May 1990 the Commission made its first statement
about this issue of transfer of employees and so on. That was followed almost annually for three
years, converted on the second occasion into a
statement and direction by the Commission, and then
latterly into the award.

MASON CJ:

You said earlier that the dispute was common

ground between the parties, or at least I
understood you to say that. Now, if that be so,
you had better explore over the adjournment with
Mr Merkel what the dispute is, because if it was
common ground I would expect that counsel would be
able to agree upon what the dispute was.

MR NOLAN:

I do not think I said it was common ground,

Your Honour. I think Justice Gaudron said it was
common ground, but that inquiry will be made.

BRENNAN J:

You do not say that it is common ground?

morning that it was common ground, and that the
complaint really went to the nature of the award
that was made, not to an issue that if the award

MR NOLAN:

I must say that I would have thought until this

was made in some sort of regular way, or capable of

being made, it was not referable to the antecedent
dispute. That issue, I would have thought, has
rather come up in the course of argument than been
one that was evident in the contentions.

BRENNAN J: Is your proposition this, that the onus of proof

lies upon the prosecutor to show that this is not
incidental. Because we do not know what the
dispute was, that onus has not been discharged?

MR NOLAN:

Yes, Your Honour, that would be our submission,

ultimately. It is after all - if the prosecutor is
going to advance that, the prosecutor would have to
say there is no dispute finding that can support
the award. But we would maintain the contention
though that in the transcript there is ample to

Hoyts(2)

3/11/92

indicate the nature of dispute, and the Commission
was proper to go forward, obviously believing as it
did, that the matters that were revealed in
May 1992 were really of a part with the broader
issues that had been between the parties for three
years at that stage.
Now, can I turn back to the outline of

submission? In our submission, because of the way
we have characterized the issues that were between
the parties, we would say that it was proper for
the Commission and within jurisdiction to make an
award because it was an award that pertained to the
employment of employees and the relations of
employers and employees as required by the
authorities, and after all it went to the heart of
securing in employment the employees of the Hoyts Corporation. And we would say that nothing could
be more central to that relationship than a
mechanism that preserved the employment
relationship pending the ultimate resolution of
those antecedent disputes that sprang from the logs
of claims in the form of a final award.

I will not go to those cases. Mr Merkel has

already gone to the relevant authorities. We would simply say that they are within the authorities and not outside them.
We would say that the interim award was

directed to the preservation of the industrial
status quo, and undertakings in similar terms were
given by the applicants at those earlier dates, and
we refer there to the passages in the record that
refer to those earlier steps that were taken, first
of all, the Commission's statement in transcript
and directions on 21 May 1990, and that is at
pages 155 and 156 of the appeal book.

BRENNAN J:

Do you say that 31.1 and 31.2 did or did not confer upon the Full Bench a jurisdiction different

from that which they already possessed?

MR NOLAN: Well, we would say that the jurisdiction is the

same as the jurisdiction that they possessed,
because they could have, after all, made particular
awards in relation to persons who were unfairly
dismissed, in our submission, and so it is in that
general area where the Commission could have made
general awards. It could have established a regime
for the termination of employment contracts of
those employees - - -

BRENNAN J: Well, there is a variety of things that a

commission can do in settlement of a dispute, no
doubt, but the powers purportedly conferred by 31.1

Hoyts(2)

3/11/92

and 31.2, are they the powers which the Commission
has otherwise than under 31.1 and 31.2?

BRENNAN J: Well, I would have thought yes, and that the

Commission has a power to make an award to set up a
regime of dispute settlement and in that connection
the Commission could have established an award that
would require the parties to have recourse to it in
certain given circumstances, and in addition to
that, of course, it otherwise possesses the power
to give statements and directions short of an award
in similar terms to the award that was made
and - - -

DAWSON J: That is relying on the interim nature of the

provision.

MR NOLAN:	Yes.
DAWSON J:	You say, what; it is holding the status quo until

it can finally give its decision?

MR NOLAN: Well, I think that was plainly the intention of

the Commission, to really - - -

DAWSON J: That is different to the matter to which

Justice Brennan was directing your attention.

MR NOLAN:

Yes. Well, I suppose I did not understand it to

be ultimately different because it could not be
said that it could do certain things on an interim basis that it might not be able to do on the final basis, but - - -

DAWSON J:	I am not sure about that.
MR NOLAN:	Looked at in the context, I would have thought it

was - - -

BRENNAN J: Say, for example, without 31.1 there had been

some change in employment conditions of a Hoyts

employee; what could the employee or the union have
done?

MR NOLAN:

The union would then presumably notify a dispute

to the Commission.

BRENNAN J: Consisting of what? What would the dispute be?

MR NOLAN:

The dispute would be the alteration by the

employer of the terms and conditions of employment
of the workers concerned, and there would be
nothing to prevent the Commission making an award
to restore the pre-existing status quo.

Hoyts(2)

3/11/92

DAWSON J: Would that not involve an exercise of judicial

power? Do you not have to go elsewhere to enforce
an award?

MR NOLAN:

I would not have thought so in given

circumstances. It may be that if, for example, to
take up this issue of the requirement that an
employee change his or her duties, it would have
been possible, I would have thought, or it would be
within power for the Commission to say no, as a
matter of industrial fairness, the employees'
conditions or duties ought not change at this time
and an award be made in a more prescriptive way
that would restore the pre-existing situation.

It may not have been covered in a

comprehensive way by an award but, in any event, I
would have thought that a more particular award
that sets out in a more complete way the parameters
of employment would be within jurisdiction. It
would not simply be a restatement, if you like, of
the pre-existing award, because the pre-existing
award on this example is presumed to have allowed
the alteration of conditions that later occurred.
This would not be a situation where you would
simply be prosecuting the employer for a breach of
the award and saying the pre-existing award did not

allow the change to take place, this would be a
subsequent award that, if you like, filled in the
gaps that permitted the changes to take place
because of the changed industrial environment and
said these particular conditions will prevail for a
given period and set in stone, if you like, the
pre-existing situation that was partly covered by
the pre-existing award.
I suppose this is the difficult that arises

where the award that is made is not a comprehensive
award in the sense that it is not utterly
prescriptive of every aspect of employment, and it
is an award that is made against a particular

industrial background. When the background
changes, then it may be necessary, and the
Commission may think it desirable, to change the
prescriptive nature of the award to take into
account the fact that the industrial background and
circumstances of a change to give the pre-existing
award, if you like, less efficacy or make the
employment circumstances, so much as they were
governed by the pre-existing award, to operate less
fairly on the workers concerned.
It is really a matter for the Commission to

make a judgment about the extent to which the award
ought to be prescriptive in crystallizing
employment conditions and restricting the capacity

Hoyts(2)

3/11/92

of the employer to effect unilateral changes within
the framework of the award, if you like.
There would be nothing, in our submission,

that would make that different to the ordinary
award-making function because, after all, even the
prescription of something as modest as tea money
affects pre-existing rights in a particular way and
creates new rights for the employee. It is just
that they are perhaps not quite as dramatic as
their rights ought to be affected in this exercise.
The history of this matter may be seen not to

commence but, at least, be something that was of
concern to the Commission back in 1990, at page 173
of the appeal book when the Commission first made

clear its concerns. I am sorry, at 173 the
position is made by senior counsel for the company,
Mr Douglas, where he says that they will give an
undertaking about the position.
At about line 24 on the page, Mr Douglas then

talks about a recommendation made by the Commission
and says, "If one thing is clear, at least, the
company has given its undertaking that it will not

alter employment conditions." Mr Douglas, again at
187, reiterates the undertaking that is given and
those proceedings go along and, finally, at
page 192 there is a short adjournment and the
presiding judge, Justice Boulton, issues a decision
in transcript where he says:
We have considered the submissions of the
parties regarding the future course of these
proceedings.
We have also considered the submissions
concerning the statement made by a full bench
of the commission on 21 May 1990 about the
proceedings before that bench involving the

Hoyts group of companies and the unions. In
out of the concerns by the unions that the
Hoyts group is not complying with that
statement.
many respects, the present proceedings arise

So, once again, it harks back to the very origins
of the dispute. Over the page, at 193 - and I will
not read this out - the Full Bench quotes its
earlier statement where it expressed concern about
developments whereby employees were offered new
contracts and transferred in their employment and
so on. Then, at the bottom of that page, the bench
makes the directions that are then carried over to
page 194.

Hoyts(2)

3/11/92

So it can bee seen that, from very early in
the piece, the Commission expressed its concern
about what was going on with the employment of
these employees and I think it is fair to say that
it was seen very much as an aspect of the
pre-existing dispute or disputes that were given rise to by the service of the respective logs of
claims in the circumstances that catapulted the
issue before the Commission.
At page 312 you have already been taken to the
decision in transcript, the decision made that gave
rise to the award on 20 May 1992. Now, we go on to
say this, that the employment - - -

DEANE J:

Mr Nolan, if you go back to page 193 and read what

the Commission said between lines 20 and 30, is it
not apparent that what the Commission had in mind
in its reference to employment conditions was the
basis terms and conditions or should that be basic
or is basis an acceptable phrase?

MR NOLAN:

I am sorry, where is the passage that Your Honour

is referring to?

DEANE J: Page 193 between lines 20 and 30. What they are

talking about are the terms and conditions that
form the basis of the employment, and they then
give an example:
In the event that Hoyts considers that it is necessary to vary any existing contracts, for
example in relation to annual salary reviews -

They did not have in mind changing the soap in the washroom.

MR NOLAN:

I am sure they did not, in those circumstances, but my reply to your earlier question really was to

indicate that it would be a broad range of
conditions that would be covered by the

Commission's award. It would not simply be

confined to the pre-existing award conditions and

annual salary reviews may well be one matter that

was outside the award.

I do not understand the

award to provide for an incremental annual salary

progression in the way that a lot of public sector

awards do, for example.

DEANE J: Well, anyway, you reject any suggesting that

employment conditions in 31.l should be narrowly
construed?

MR NOLAN:

Oh no, I think the employment conditions ought to

be broadly construed and that would be consistent
with what the Commission is directing attention to.
Merely, I would think, the mention of annual salary

Hoyts(2)

3/11/92

reviews would demonstrate to show that it went
broader than the narrow award concerns because of
the reasons I mentioned, that an annual salary
review was not ordinarily a part of the award
prescription as against the broader conditions of
employment.

DEANE J: Thank you.

MR NOLAN:

And could I say, I think one of the complaints

the company made was, "Oh well, we will not be able

to conduct an annual salary review". The
Commission met that by saying, "We will see to it
that you are able to apply and arrangements can be
made for such a review".

DAWSON J: Is the Commission not saying there, "Look, we

have not time, at the moment, to look into the
details of this. Hold the status quo", which is
exactly what it says, "until we can formulate with
more specificity the appropriate award in this
matter."

MR NOLAN:

Yes.

I think very much so.

And when one sees

the range of issues that were between the parties
it would have been a herculean task for the
Commission to try to reach a final award
determination in the circumstances. And really,
this was an exercise in trying to hold the status
quo, so that all these issues could be argued out
before the Commission and be the subject of some
ultimate settlement. And we would say in the
circumstances it is justifiable and within power.

DAWSON J:

Even if, ultimately, it proved that they did not

have power to make an award in the terms in which
they made the interim award.

MR NOLAN:	I suppose it is possible to envisage circumstances where, having in mind what has been
said about an industrial dispute not necessarily -
perhaps in some circumstances - not necessarily
being able to be translated into an award term, I
suppose bearing that line of territory in mind, it
would be possible for the Commission to make a
status quo award, if you like, but ultimately not
make an actual award -
DAWSON J:	No, no, a status quo award going beyond that

which they could order by way of a permanent award.

MR NOLAN:

I am sorry, Your Honour.

I did not hear the

last ---

Hoyts(2)

3/11/92

DAWSON J: Going_beyond that which they may make the subject

of a permanent award.

MR NOLAN:

I must say, I think in these circumstances it is

hard to think of an example of that, simply because
this award is directed to the terms and conditions
of employment of employees and I would have thought
an ultimate award could be made that was highly
prescriptive of all those terms and conditions of
employment that would be well within the power of

the Commission. So in these particular
circumstances, I do not know that it would be
necessary to postulate a situation where the
interim award could not find its way into a final
award because, after all, this interim award only
dealt with matters that could be, in our
submission, ultimately included in the final award.

BRENNAN J:

Does it follow from that answer that the

Commission had power to include in the final award
a provision that the company should not conduct
annual salary reviews, except with the leave of the
Commission.

MR NOLAN:

I think it does.

It has been held by this Court

in Hegarty's case - which was on my list of
authorities, but not one to which I specifically
propose to refer - that the Commission could
establish a regime for the determination of
promotions and promotions appeals for employees in
local government; I think it was in the city of
Elizabeth in South Australia.
So, the occurring of some antecedent event, or

some condition precedent to some step being taken,
has not been seen to be beyond the jurisdiction of
the Commission and I would have thought, seen
against the background of that authority, it would
not be exceptional at all for the Commission to
have recourse to it as a condition precedent to a
step being taken, in the same way that it could -

before somebody is put on, or, in the case of the an employer to refer to, say, the union secretary and I refer to these cases in my outline - oblige Victorian Clerks case, to confer with the union
officials and the workers concerned before somebody
is sacked or before a decision is taken to
introduce technological change at the workplace.
So, in my submission, this would really be in the
same category as that kind of award in that it
makes a particular step as a precondition for
something ultimately being done.

Now, admittedly it is in very unusual
circumstances and it is not an award that the
Commission would be likely to make otherwise than
in very much as an interim step along the way to

Hoyts(2)

3/11/92

some final dispute resolution, but I would have
thought, on the basis of authority, establishing
the occurring of some event as the trigger for some
later decision to be made is not outside of its
power.
Now, if I can return to the outline: we

contend, next of all, that employment security has
long been recognized as a proper topic for
industrial award prescription and in that
connection refer to Cram's case and Ranger Uranium Mines case, and submit, of course, that once again
that really this award is all about employment
security and the topic of employment security, one
would have thought, is central to the relations of
employers and employees and the regime approved of
in Cram was, in a sense, the obverse of this. Cram
obliged the employer to take the workers one by one
off the union's hiring list. This award requires
the employer to take a step at the other end of the
employment relationship - and in the course of the employment relationship - namely not to put people out of employment or change their employment
without reference to the Commission.
So far as Ranger is concerned, once again that

is a decision that deals with employment security.
It of course was held by this Court that the

existing employees had a real interest in the
employment security and the right to be reinstated
if they were unfairly dismissed or employees, their
colleagues who were dismissed unfairly. This
really puts a barrier to the unfair dismissal or
the dismissal in unusual circumstances by virtue of
the recourse to the Commission, but it deals, in
our submission, with essentially the same topic,
namely employment security.
Admittedly, it perhaps can be said to impose a

more restrictive regime, but we would say that that
is a matter for the Commission to make a judgment

about in all the circumstances, presented as it is
with this industrial dispute that has gone on for
three years that involves a bitter contest and
involves the transfer of employees to employment
with a company that at that stage was not bound to
any award.
We would go on in that vein to say, as we do

at subparagraph (c), that the simple fact that the
award places a fetter on a management prerogative
is no objection to jurisdiction. Once again we
cite Cram as authority for that. Obviously this
award places a real fetter on the management's
ability to transfer employees to give them other
duties, but we would say that at the end of the
day, in accordance with the authority in Cram's

Hoyts(2)

3/11/92

case in particular, that that is not an objection
to jurisdiction; that really goes to the wisdom or
propriety of the Commission's exercise of its
powers in a discretionary way to build a regime
that is suitable and appropriate to the
circumstances before it arising from these
conflicting demands.

MASON CJ:

Mr Nolan, we will adjourn at this point.

How

long is the balance of the two cases going to take?

MR NOLAN:

We would hope that we would finish both this

afternoon, a little less optimistically than I did
this morning, but I think the hope of all is that
we will finish them both today.

MASON CJ:

We will adjourn until 2.15.

AT 12.51 PM LUNCHEON ADJOURNMENT

UPON RESUMING AT 2.17 PM:

MASON CJ: Yes, Mr Nolan.

MR NOLAN:

May it please Your Honours, can I mention three

things perhaps. Firstly, I have been chided by my
colleagues for being unduly optimistic in my
assessment of the time that the remaining two cases
would take. Although I looked around at the time
and did not see any demurrer, others have indicated
to me their concern about whether or not we could
finish the second case today.
Can I next move to this question of the dispute and the dispute findings from which we say

books do not contain the record of dispute, but the present award sprang. Certainly the appeal
tracing through the history of these matters of
concern, if one goes to page 150 of the appeal book
one gets some sense of the fact that this
particular issue, the transfer of employment, and
the maintenance of the status quo, if you like,
appeared to be a persistent theme from the very
early days of the disputes that gave rise to the
competing contentions in the endeavour to rope in
the subsidiary companies and so on.
On page 150 at about the middle of the page,

Mr Stewart, who was then the advocate for the
union, indicates that the maintenance of the status
quo was a desire that was put before

Hoyts(2)

3/11/92

Commissioner Mansini, who by that stage had
retired, who was dealing with the matters between

the parties. Down at the bottom of the page he
refers back at about line 45 to -
Commissioner Mansini expressing a view and making recommendations as early as 15 September 1988, and
he said that that was the first time that he said

it, referring to Commissioner Mansini. Mr Stewart
goes on to say this:
I think, Your Honour, the court file will show
that Commissioner Mansini made a number of
recommendations, a direction and finally an
order of this commission, none of which we
would submit to you that the employer party
was prepared to abide by, and the essence of
each one of those - the recommendation, the
direction and the order in turn, the situation
of the employment of a person subject of this
dispute be returned to that prior to the
dispute.

So one can see that from very early days this was
present as a concern in everyone's mind, and that
really takes it back to the Commission first
interceding in terms in that matter as early as
September 1988. Of course, that particular
exchange that involved Mr Stewart resulted in the
first of those recommendations which appears on
page 155 where there had been a short
adjournment - and I think I referred to this
earlier - when Justice Boulton then announces a
decision which deals with this issue of altering
the status quo. That was back in May 1990, so it
appears, although we have not got the original
dispute findings, and unfortunately because those
who instruct us in Melbourne are not in the office
today we have been unable to make any further
inquiries, but it certainly seems that it was at
least taken for granted as far as all the parties
were concerned that these issues went right back to

the original dispute notification, and do not
appear to be questioned over the three-year period taken, or alleged to be taken, in the employment of the employees concerned.
during which these matters returned to the
Can I say, thirdly, that so far as the issue

raised before the luncheon adjournment by
Your Honour Mr Justice Deane about the scope of the
award, we would not want it thought of our
submission that it would extend to the point where
we say that every possible aspect of employment

would be regulated to the nth degree. We would be
content to rest on what was the obvious intention
indicated by the Full Bench at page 193 of the

Hoyts(2)

3/11/92

appeal book where the Full Bench, I think, in
Justice Boulton's decision in transcript, indicated
that it was concerned to see what is recorded as
"basis terms and conditions of employment"; well, I
think it was really meant to mean "basic terms and
conditions of employment" to be maintained pending
the outcome of the hearings, and of course, once
again, that particular quotation, referring to the
"basic terms and conditions of employment" hark
back to the 1990 proceedings in this particular
State, that it was made by Justice Boulton in May
1991 and, of course, that led to the statement and
directions and then a year later the application to
have this statement and directions converted into
an award. So, once again it is a consistent theme
and it really can be said, was one that was
directed to maintaining those basic terms and
conditions and did not concern itself with
peripheral or exotic terms and conditions of
employment.
Now, may I return to the outline. What is

next contended is that there is nothing unusual
about an award of the Commission, or of its
predecessors for that matter, conferring an
obligation on a party to an award to take some step

in relation to a third party. An award may, for
example, place restrictions upon management in the
granting of preference in employment to unionists
or notification of prospective redundancies, and
the grant of leave by the Commission as a condition
precedent to the alteration of an employment
condition, or termination of employment is merely a
step in the particular industrial circumstances
before the Commission and in the final settlement
of the disputes before which the dispute was
partially settled by the interim award.
We would reiterate the importance of seeing the step that was taken as one that was an interim
step, taken to maintain the industrial status quo

pending the ultimate award being made.

MASON CJ: Are the awards in the form of clause 31 made from

time to time by the Commission in the exercise of
its jurisdiction, or is this an unusual one?

MR NOLAN: This is unusual but, I submit that the

circumstances were perhaps unusual. I am not aware
of an award having been made by the Commission like
this. That is not to say that such an award has
not been made. But it us certainly an unusual
award, but once again we would say, tailored to
meet the particular circumstances expressed as an
interim measure.

MASQN CJ: Yes, I follow.

Hoyts(2)

3/11/92

MR NOLAN:

So we have to say this, an award may confer

benefits, including benefits which may result in enforcible contractual rights indeed, upon third parties, in the course of creating reciprocal
rights and duties between the parties and we quote
there the decision in the Metal Trades case, 54 CLR
387, and I will not read those passages but I refer

to pages 405, 418 and 425. Of course, the
authority is well-known authority that involved the
award being extended to the non-unionists that were
in the employ of the employer, the rationale being,
of course, that that protected the rights and
conditions of the unionists who were employed, who,
in the absence of such an award term, could have
had their rights and conditions undermined by the
employment of non-unionists, and a similar
rationale, if not identity of award approach, can
be detected, I would submit, in the interim award
here.
In (b); an employer may be required by award

term to contact the union to inquire whether a
unionist is available before offering employment to
a non-unionist, and in that connection we cite R v
Holmes; Ex parte Altona Petrochemical Co Ltd, once again, an award term found to be within power that
placed a severe, on some views - on one view~ a
severe restriction on the employer, preventing the
employer from picking up employees as he saw fit,
but rather requiring a somewhat involved procedure
whereby the union was interrogated about likely
candidates for employment before employment could
be offered. So, a severe restriction; once again a
restriction involving the participation or the
happening of an event that was in the hands of a
third party.
Next an employer may be required by an award

term to hire from the union hiring list before
offering employment to a non-unionist: that, of
course as Cram's case, which we have referred to

earlier, and finally in this section, an employer
may be required by award term to notify and consult
with its employees and their union where
consideration is being given to the introduction of
technological change in the workplace.
Their cited is, of course, the Victorian

Federated Clerks' Union case where, as the Court
will recall, quite a detailed prescriptive award
was sought by the union, which would oblige
employers not just to inform the union and consult
with it - and the union's members in the relevant
employ - upon a final decision being made which would have an impact on the employees, but at a

much earlier point in the process. So it was that

Hoyts(2)

3/11/92

when a feasibility study was commenced which might
lead to decisions being taken which would have an
impact on the employees' concern, the union sought
the award.
This Court held, of course, that that was

within power in analogous circumstances and it was appropriate for the Commission to use its judgment and discretion to design such an award term, if it
was felt that the employees' interests were
directly threatened by these changes that were
brought about by the introduction of technology.
So once again we would say these are all cases that

are analogous to the situation here. What we have
here is really a variation on a well established
theme.
Our next contention is that the present

interim award prescribes a step to be taken in the
future adjustment of rights as between the
applicant and its employees. In the context of
extant unresolved dispute proceedings we say that

the interim award does not endeavour to supplement
earlier May 22 1991 directions which were not the subject of any application. In this connection we would distinguish the situation in Portus' case. There was no attempt in this award
the functions of the Commission but works within out, the
the jurisdiction in the exercise of the
to establish some elaborate mechanism through which
a dispute was to be processed.
We do not need, we would submit, to be

concerned with the demand that was put forward in
Portus' case, because it was put forward in a

particular way in a specific context and it was not
a demand that raised an issue of dispute-settling
procedures or promotional appeal mechanisms a la
Hegarty's case, but really involved the
supplementation of the Commission's power to act in

a particular way - perhaps even to give it
jurisdiction which it lacked - and also to confer
upon it the power to award compensation in certain
circumstances.
So we would say that the situation here is a

world apart from the situation in Portus' case.
There is one simple condition precedent required by
this award: namely, the leave of the Commission
being sought. Any further step that relates to any
other issue that might arise in relation to
employment could be the subject of separate or
related proceedings before the Commission. But in
any event, there was no endeavour to establish some
sort of additional mechanism through which certain
proceedings ought pass.

Hoyts(2)

3/11/92

We will conclude by saying in this part of the
submissions that the award was incidental to the

dispute in question. We have to concede that the
finding of the original dispute is not contained within the appeal documents, but we would submit
that that is rather because all of the parties were
alive to the issues in dispute and all parties
proceeded on the basis that the original dispute
findings that gave rise to the award adequately and
properly supported the award that was made and that
in the event that there is required evidence of
that contention, that is really satisfied, in our
submission, by the references repeatedly made to
this very issue that became the subject of the
interim award within the context of proceedings
that sought the roping in of the subsidiary
companies to the main award and sought repeatedly
undertakings and directions and so on that the
award position would be preserved, or the status
quo would be preserved, before subsequent steps
were taken.
Because had we that finding, we could look to

it and come back to comparing it with the award
that was made and perhaps reach some more adequate
conclusions, but certainly the draft award that was
presented by the Commission, Mr Livingstone's
letter that brought the matter back before the
Commission, all of them, we would say, were within
the context of those ongoing disputes which were
well and truly before the Commission and were
revisited by the Commission on numerous occasions,
on each occasion the Commission taking a further
step to strengthen its hand, as it were, as against
the disputing parties in relation to the complaint
about this position of the status quo.
Those are the primary submissions that are

made. Very briefly, if I may just reply to some
matters put this morning by my learned friend,

Mr Merkel. As to the first parts of his
submissions we believe that we have met those. In
relation to clause 3(d) and 4 can we say this, that
there is no suggestion here that there was any
private or isolated contractual dispute that was
not amenable to award regulation.
We would take issue with the contention that

the award sought to regulate purely private
matters. There is nothing unusual at all about an
award seeking to regulate the contracts of
employment of groups of employees, as was the
object of this award. So far as Staples' case is
concerned, in our submission that can be well and
truly distinguished because it involved a single
isolated employee that did not put forward his
dispute against Telecom in concert with any others,

Hoyts(2)

3/11/92

and so it was held that the dispute he had lacked the requisite industrial colour or flavour and so could not be prosecuted to finality in the form of
an award because it had this isolated and one-off
character.
So we would take issue with what is put

forward in paragraph 3(d). So far as paragraph 4
is concerned, we would say that that is not to the
point, and the Metal Trades case, if none other,
really squarely meets what is suggested in
paragraph 4 because it may well be that some
employees might voluntarily wish to have their
conditions of employment reduced for whatever
reason.
But it is the job of the Commission to

determine in the broad what is desirable in terms
of industrial prescription and it is not to the
point at all and irrelevant for the exercise of the
Commission's jurisdiction that some employees may
decide that they want to work for free or work for
substantially reduced rates, because the rationale
of the award-making process, at least as far back
as to the Metal Trades case, was that the making of
the award that covered all the workers in the
relevant employ was desirable so that the
non unionists' rates could not be set at a point
where they would undermine the employment of
unionists under the award.
So we would have thought that that proposition

was well and truly met by the rationale of the
Metal Trades case and has been contradicted by what
that case stands for since at least 1935 or 1936.
Those are the submission for the second respondent,
may it please the Court.

MASON CJ: Thank you, Mr Nolan. Yes, Mr Rose.

MR ROSE:

If the Court pleases, may I hand up the outline of

our submissions.

MASON CJ:	Thank you.
MR ROSE:	If the Court pleases. My learned friend,

Mr Merkel, concentrated much of his attention on
the decision in Reg v Portus; Ex parte City of
Perth and the Melbourne Tramways case and the
recent Shell case, relying on those cases for the
proposition that the role given to the Commission
here in this clause 31 is beyond the powers of the
Commission. In my submission, his reliance on
those cases is not justified.
Taking the case of Portus first, there are several strands in the reasoning there and it is

Hoyts(2)

3/11/92

point must be to focus on the actual claim in that
case and, for that purpose, I would invite the
Court's attention to the report, 129 CLR 312,

necessary to separate them out. But the starting of page 313. Paragraph (a) of the claim is:
that officers, in the event that their
employment is terminated or who are dismissed,
shall have the right to appeal against such
purported termination or dismissal to the
Commonwealth Conciliation and Arbitration
Commission -

et cetera. It was the claim in those terms that gave rise to several strands of reasoning in the
judgments, one being that the claim did not pertain
to the relationship between employer and employees

but rather to the powers of the Commission. We
have given the references there to the judgments of
Justices Gibbs and Stephen and it was central to
the reasoning in those judgments that the feature
which attracted the propositions in the judgments
was the fact that the provision related to what
would happen after the employees were dismissed.
So it was easy to characterize the claim as

one concerning a function to be performed by the

Commission in relation to X employees. Whenever
the situation arose it would be a function for the
Commission to perform in relation to X employees,
and so one sees the reference to X employees in the
judgments of Justice Gibbs at page 323, and then
the following reasoning at pages 324 to 325 based
on that feature of the claim, and again at page 329
in the judgment of Justice Stephen.
Another strand in the judgments based on the

terms of that claim was that the function that
would be performed by the Commission when it came

to the so-called appeal to the Commission from a
dismissal would be a function exercised in relation
to the particular cases of dismissals and that
these would be necessarily local, ie intrastate
controversies, not interstate disputes, and it may
not have been a situation where one could invoke
the more recent principles laid down by this Court
in such cases as Ranger Uranium, and discussed in
Wooldumpers, and now under consideration in several
proceedings, for example, Boyne Smelters, I think,
was one of them. The City of Perth situation would
not have come within those principles, and so it is
not surprising, in my submission, that
Their Honours Justice Stephen and also
Chief Justice Barwick at page 316 said that this
was really a claim about the future settlement of
intrastate disputes.

Hoyts(2)

3/11/92

The same point underlay the judgment of
Justice Menzies in the Tramways Board case,

113 CLR 255 to 256. I will not read the passage,
but simply observe that the crucial proposition
there was that the claim concerned the settlement
of what would essentially be local disputes. That
arose because the terms of the claim were that the
employee shall not, without the consent of the
union, or by order of the Commissioner of the
arbitration court require an employee to operate a
one-man bus. Plainly, the function for the
Commission there to make orders would only arise if

the union had not given its consent. In other
words, again it was a situation where the claim was
being made for a mechanism for settling what, as
Justice Menzies said, would essentially be
intrastate and local disputes.
The reliance by the applicant, too, on the recent Shell case is also, in my submission,
unjustified because again, the terms of the claim

make plain what was at stake there. What was
claimed was that things should not be done except
with the prior written consent of such proportion of the members of the union as the Commission may
determine, or an order of the Commission approving
such an arrangement, revocation or modification.
Those were arrangements, revocations or
modifications concerning transfers of money into
and out of trust funds not under the control of the
employer, and for revocation and modification of
the terms of the trust fund.
In my submission, those cases are completely

different from what is at stake here, where
clause 31 is not setting up a mechanism to be
applied in the event of a dispute; it applies
whether or not the union agrees with the employer concerning the changes in terms and conditions or
in transfers. It should be seen, in my submission,

as an interim measure in the course of settling

whatever may have been the main dispute. It is not
part of my submission to enter into the factual
questions as to what that main dispute may have
been. Therefore, the proposition there, at our
third dot point, is instead of being categorical,
it should be expressed to be, "on the assumption
that" the measures taken in clause 31 are within
the scope of what is incidental to the settling of
the main dispute.
On that assumption there is power under the

Act for the Commission to do that very thing. The
power is derived from section lll(b), concerning
the making of interim awards; paragraph (d) and
paragraph (t), which were discussed this morning.
In that respect I merely add, if the Court pleases,

Hoyts(2)

3/11/92

the submission that, in considering what is
incidental in this sort of context, the wide view
should be taken, and it may be that in some
emergency situation it may be highly desirable to
maintain the status quo without necessarily having time to go into questions as to what precisely are
the limits of the main dispute.

McHUGH J:

Is it your submission that the power to make an

interim award is, in some cases, greater than the
power to make a final award in respect of the same
matter?

MR ROSE:

In my submission, yes, in very special

circumstances it may well be so. This may not be
the sort of case where that would be justified, but
one could, in my submission, conceive of emergency
situations where there is a very urgent need to
maintain the status quo pending examination of
these very questions as to what the range of the
main dispute is; what are the economic
relationships that may be relevant to a decision to
settle that dispute. So, it is conceivable that
one could have an interim award which, in the
eventual examination of the whole situation, has
been found to travel outside the strict limits of
the terms and conditions which were the subject of
the main dispute.
In paragraph 2 of our outline we have

addressed the argument by the applicants that this
clause is invalid because it involves the
Commission in the future management of the business
of the employer, and I think enough has been said
in relation to Re Cram and so on to make it
unnecessary for me to add anything to that except
to say that in this respect clause 31 would not be
distinguishable from clauses requiring approvals,
for example, by boards of reference, which are set
up under section 131 of the Industrial Relations
Act. The function of boards of references was

mentioned there; the question as to whether it was considered in the case of Re Hegarty which was
exercising judicial power, but no doubt was cast
upon the constitutional power to provide for
matters in the administration and operation of an
award to be subject to approvals by some outside,
so to speak, body.

McHUGH J: There has never been a direct challenge, has

there, to the use of boards of reference?

MR ROSE:	I was unable to find one.
McHUGH J:	I do not think there is, from recollection.

Hoyts(2)

3/11/92

MR ROSE:

In my submission, and in principle, there should

not be any constitutional objection to the use of
such boards, and if that proposition is right then
I think, in my submission, it is indistinguishable
to have the Commission itself performing the same
function, the only problem being the question
whether there is the statutory basis for what the
Commission does. Quite clearly there is a
statutory basis for boards of reference.
Finally, if the Court pleases, I will comment

on paragraph 3(d) of the applicant's outline, the objection that clause 31 purports to regulate the
private matter of an individual contract between
the employer and an employee. I am not entirely
clear in my own mind what was intended by the
reference to private matter, but on looking at the
various cases quoted there, one finds that the
reference is not to private matters but to matters
concerning particular individuals, and that was all
in the context of cases like Ranger Uranium,
Wooldumpers and so on where the question was
whether the claim dealt with particular local
disputes, eg local dismissals, and that is why the
emphasis was put in the language on the particular

individuals. In my submission they certainly do
not support any proposition that can be expressed
in terms of a distinction between private and other
matters.
If I may just revert to the question of the

width of the incidental power, I note that the
power is available not only to deal with actual
disputes, but one must, in my submission, bear in

mind the definition of dispute in the Act as
extending to a threatened, likely or probable
dispute, and so that considerably widens the range
of what it would be open to the Commission to do,
but I make no submissions on the statutory

questions as to whether to Commission ought to make findings and so on in that sort of situation before

it moves on to make an interim award. If the Court
pleases.

MASON CJ: Thank you Mr Rose.

MR MERKEL:

If I can first deal briefly with the background

to the dispute, and in the application book certain
exhibits, I think it is MGC 3-7 were not produced,
but could I hand up to the Court, but I do not want
to take the Court to the detail of them, but can I
hand up to the Court those exhibits which were not
part of the application book. They were referred
to -

MASON CJ:

To what end, what is the purpose of this?

Hoyts(2)

3/11/92

MR MERKEL:

The purpose of it is, Your Honour, to show that

the matters that the Commission was arbitrating on,
as identified in the affidavit, were the minimum
award terms and conditions arising out of the Hoyts
application to vary the 1983 award and the original
log, which is MGC 3, relating to award terms and
conditions arising out of the 1988 dispute, so that
in substance, the exhibits show that in MGC 3 the
unions - sorry, what occurred after the Canberra
agreement was not continued by Hoyts.
There was disruption and Hoyts notified a

dispute which is MGC 3, then there was a letter of
demand on Delarene and Rampton by the two unions
which is MGC 4 and 5 which sought, in effect, to
have award terms and conditions in respect of the

two subsidiaries. Then there was an application by
Hoyts to vary the 1983 award and when Your Honours
read through the affidavit, all those matters were
then referred to a Full Bench, which then was
arbitrating those matters, so that even though the
original dispute findings, which were limited to

MGC 3, 4 and 5, were on a very narrow basis. The
arbitration related, in effect, to the award terms
and conditions arising out of the variation to the
1983 award.
The vice that arose is that clause 31 did not

limit itself to the subject-matters the subject of
the claims or the subject of applications for
variation; they covered any and all employment
conditions. We would say, with respect, that that
term is a very wide term, certainly not limited to
any matters the subject of the claims. Indeed,
when the Court examines what was in fact dealt with
by the Commission - and if I can just give
Your Honours the reference, in paragraph 44 of
Mr Caldwell's affidavit and also paragraph 48, the
transfer of one projectionist from one location in
Melbourne to another was regarded by everybody, including the Commission, as a change in employment
conditions, and an additional function given to

ticket sellers in Adelaide was also likewise
treated as a change in employment conditions.
My learned friend's answer to Your Honours

this morning was correct when he said reviews of
salary, promotions, demotions, matters such as that

were all embraced by clause 31. So we say that
that clause, because it is so unrestricted and not
in any way limited by the subject-matter of the
dispute which one can accept is identified in its
widest form in the variation to the original award,
transcends those subject-matters - likewise with

respect to transfer of employment. We say that
transfer of employment was not a separate matter.
That was a matter arising out of the claim in
relation to terms and conditions of employment. It

Hoyts(2)

3/11/92

may be a consequence but it was not itself the
subject of any dispute or any finding, so that
clause 31 we say stands apart and far beyond any of
the matters the subject of original disputation.

BRENNAN J:	Mr Merkel, if the words "without the leave of the aforesaid Full Bench" in 31.2 and "without the leave of the Full Bench of the Industrial Relations
Commission assigned" et cetera in 31. 1 were
deleted, what would be the ground on which you
could challenge the balance of those clauses?
MR MERKEL:	We would say, Your Honour, that that would be

challengeable on the grounds set out in
paragraph 3(b), 3(d), 4 and the one I have just
identified, that because it was so wide in respect
of conditions and any transfer without reference to
any limiting subject-matter, it was not capable of
being referable back to the ambit of the original
dispute, which are contained in the exhibits that I
would ask, if I could, to hand up to Your Honours.

BRENNAN J: 3(b) would not have anything to do with it,

would it? I am suggesting to you that the
Industrial Relations Commission requirement of
leave is deleted. In other words, that there is
just simply a maintenance of the status quo.

MR MERKEL:

I think what we would say, Your Honour, is that

it would be the exercise of arbitrary power to
refuse to change any conditions of employment
without a mechanism other than variation.

McHUGH J: But is that the correct way to look at it? Is it

not an absolute prohibition subject to a right to
apply for a relaxation of the prohibition in
certain circumstances?

MR MERKEL:

We say not, Your Honour.

We say that it is a

prohibition without leave. Your Honour said, "in

certain circumstances". We say - - -

McHUGH J: Well, it is simple prohibition subject to the

discretion of the Commission to relax it.

MR MERKEL:

Your Honour, it may be a difference in wording.

We would say that it is not to change without leave. It means you have to go and get leave before you change, but I think the vice, we would
say, of it as an absolute power is that it is
arbitrary and it is not limited, and it contains no
criteria by which the prohibition is referable to.
We would believe the Commission would not impose

such a provision. We would say that is not the
issue in the present case, but we would not expect
the Commission to ever impose that save in the most

Hoyts(2)

3/11/92

extraordinary circumstances, none of which are
present in the present case.

McHUGH J:

Why not as an interim award? Let it be assumed

in your favour that the Commission could not make a

final award in those terms. Why could it not make
an interim award?

MR MERKEL:

Your Honour, a number of reasons.

May I say

this: in the two Tramways Board cases
Their Honours were dealing with interim awards, and
I am not aware of a case where it has been assumed that an interim award gives a wider power than the award making power itself. Having said that, the
interim award power contained in section 111
certainly does not itself suggest that it would be
a wider power because in section 111(1) it is
contained all within the one power.

McHUGH J:

I appreciate that, but whether or not a matter is

incidental to another matter depends on
circumstances, and when one is dealing on an
interim basis one of the relevant circumstances may
be that the position is not clear. Therefore, you
may be able to do something because of that problem
which you could not do after an exhaustive
examination when the facts have been ascertained.

MR MERKEL:

Your Honour, we accept that one may be more

robust on an interim basis, but we say that goes to
the way in which you will exercise a discretion,

but always within power. We say ultimately it is
the constitutional head of power that cannot be
transcended and that that sets the limit, and we

say it sets the limit in· respect of awards. There
is nothing in the Act that would suggest that
interim awards be given a wider ambit of
operational power. Indeed, the same statutory
provisions apply to all awards, and we would say
that the constitutional head of power cannot be

transcended merely because one deals with it on an interim basis. It is an award for the prevention and settlement of an industrial dispute within the
constitutional head of power or the statutory head

of power. We say the statute does not go beyond
that. Certainly that appears to have been the
basis on which this Court has acted or treated

interim awards in the past, and we would submit that whilst interim powers may give them a more robust and wider discretion and a wider ambit to do
that which is reasonable, which, on a final basis
may not be reasonable, we say it does not give them
a wider ambit to go beyond their head of power.

BRENNAN J:

Why would it be beyond power if there was a log

and counter log for the Commission to settle that

Hoyts(2)

3/11/92

dispute by an award which says the existing
situation in all respects shall be maintained?

MR MERKEL:

Your Honour, firstly, it would have to be

limited to the existing terms and conditions, the
subject of the dispute, not any terms and
conditions, not those not in dispute, and the
present claim goes to any terms and conditions
irrespective of whether in dispute or not.

BRENNAN J: That assumes, does it not, that the terms in

dispute can be, as it were, severed from the terms
which are not and that the contract of employment is not to be regarded as an entire contract which
canvasses some pros, some cons, for each side?

MR MERKEL:

Yes, Your Honour, but I have in mind that when

the logs and when these exhibits are examined they do not cover every employment condition imaginable

as the provision in clause 31 does. So it goes
beyond that which is capable of being the subject
of arbitration because - when I say they are not in dispute, I mean they are not the subject of the log
or the disputation between the parties. So,
therefore, one cannot read down clause 31 to just
award terms and conditions or the terms and
conditions the subject of the arbitration; it goes
wider than that.
Secondly, Your Honour, if an award was made

that there be no change in the conditions the
subject of disputation, that, we say, may be the exercise of the more dramatic interim power than
one would expect on a final resolution and it could
be within the power to prevent further disputation
in respect of those matters.

BRENNAN J:

My question was postulated on the basis that this is a final award in terms of beyond power.

Why would it be beyond power to say, if you wish to

restrict it to the issues in dispute, "As to all

issues in dispute, the status quo shall be

maintained."?

MR MERKEL:

Your Honour, we would say that it would attract

the problem of arbitrariness, that it would attract
the problem irrespective of the wishes of the
employees, irrespective of the connection between
the term and condition with disputation,
irrespective of whether it is preventing or
settling a dispute. In other words, it is such a
wide power that it could not be properly related to
the head of power or the purpose of the head of
power. That is why one may find some ambit for it
in a specific case with some specificity. But when
it goes to as broad an ambit as this, one sees it
lacks the statutory or constitutional foundation to

Hoyts(2)

3/11/92

connect the exercise with the power and the purpose
for which it was conferred.

McHUGH J: But are the wishes of the employees relevant once

it is accepted it must be that the union is a party
to the dispute itself and does not really act as
agent with the employees?

MR MERKEL:

What Your Honour says is correct, except if we

could qualify it by adding that it is irrespective

of the wishes of the union or the employee. The
point we really make is that it is irrespective of

the reason or the basis for the change. It is
totally unrelated to anything. That is why we made
the point that had there been criteria or had there
been a ban on a limited basis that may be within
power. But that is not what the Commission has
done; nor is there any indication the Commission
would do it. For example, in the present case, the
Commission did not extend clause 31 to Delarine and
Rampton.
Even though there has been suggestion by the

unions of breaches of undertakings, there has never
been a finding by the Commission that, in fact,

there has been a breach of undertaking. The
furtherest it went was at page 205 when the
Commission said there may have been but there has

never been a finding against the employer. So that
to talk in terms of this award as even arising in
any dramatic urgent situation, we say, is to
misdescribe its circumstances.
So we say that this case does raise the

broader question. If this is an appropriate form
of interim relief, it will apply in any case where

there is disputation of terms and conditions. This
is not an extraordinary or an exceptional case.
The Rampton/Delarine problem is many years old.
There is nothing recent about it and, indeed, the

fact that the clause did not extend to them and
clause 32 exempted them from the major terms and
conditions relating to rates of pay shows that to
talk of this as interim and urgent and, therefore,
giving a wider head of power, we say, is to
misdescribe the foundation upon which it is built.
So it is our submission that the submissions

that we put in respect of this particular award do
result in it transcending the jurisdiction

conferred on the Commission. It was suggested that
directions might have statutory effect. We would,
with respect, say that the statutory effect of a
direction is limited to the procedural matters
dealt with in subsections (d) and (t) of
subsection 1, and really has little more effect

Hoyts(2)

3/11/92

than a recommendation. An order becomes an award
and that was what clause 31 has dealt with.
The other matter is a number of questions were

asked about the genesis of the undertaking. It did
go back to that passage at 150 with Commissioner

Mansini in 1988. As a result of that the
Commission set the notion of a status quo and all
proceedings later were, in effect, geared to how
that could be achieved, with the employers
objecting to it being capable of being within an
award.
So we would submit that for those reasons the

submissions that we have put do indicate how it has

been transcended. My learned friend, on behalf of
the Commonwealth, indicated that this case is
distinguishable from Shell, Portus and the Tramways

Board. We would say, with respect, it is not.
There was in Shell a prohibition on the payment

without leave. Tramways Board there was a
prohibition on going back to one-man trams without

cases and the way in which this Court has treated

leave. We say that the structure of each of those the present case is not distinguishable.

DEANE J:

Mr Merkel, am I right that implicit in what you

say is that no one ever asked for an award in
terms of anything like 31.1?

MR MERKEL:

I think the union asked for it, Your Honour.

DEANE J: It asked for it in its log of claims?

MR MERKEL:

Not in the original log, only in the application

for interim relief.

DEANE J: If we go back to the dispute as that constituted

by the logs of claim, is it the fact that nobody

ever asked for anything like 31.1?

MR MERKEL:

That is correct, Your Honour. And what I would

ask Your Honours, if we could hand up to
Your Honours' associates at the conclusion the copies of those exhibits which are referred to in the affidavit, which set out the matters in

dispute. I would also ask for leave, if I might,
but it may not matter, the only findings of dispute
that were made were a finding in MGC 3 and MGC 4
and 5, which are very old findings and the main
matter being arbitrated was the variation to the
1983 award. We would ask if we could hand up or

have delivered to the Court those findings. But we
say the exhibits set the ambit of the dispute that
the Arbitration Commission was dealing with.

Hoyts(2)

3/11/92

MASON CJ: Yes, you may have leave to do that, Mr Merkel.

MR MERKEL:

Thank you.

If the Court pleases.

MR NOLAN:	Your Honour, might I be heard on that issue?
MASON CJ:	On what?
MR NOLAN:	Leave to produce those other documents?

MASON CJ: Yes.

MR NOLAN:

Because I must say that we read the initial

application as not going to this issue of the

antecedent dispute. We did not really believe that
that was an issue between us, and I refer in that
connection to page 13 of the appeal book where, we
would submit, all the points taken and ground
relied on in relation to the exercise of the power
went to the Portus style of objection, if you like.

There was nothing raised in terms. It said that
the antecedent dispute did not support a later
award in terms of clause 31, on our reading of the
grounds.
We have been unable to get any instructions at

lunch-time because of the difficulties I mentioned

earlier about these initial notifications. Were
we of the view that this was going to be an issue,
we would have undertaken some more exhaustive

researches to see exactly what it was. There may
be material on transcript before
Commissioner Mansini right back in 1988 that goes
to this matter because, after all, he was the first
member of the Commission that made recommendations
relating to this very question of the preservation
of the status quo, and that is not reproduced.
Can I also indicate that along the way, in

addition to those matters that I referred to

earlier, at page 196 of the appeal book is
reproduced one of the union's proposed interim
Hoyts Corporation awards which reproduces various
demands about contracts of employment at clause 6
of the demand.
So it cannot be said in an unequivocal way

that a claim like that was not a part either of the
original logs, something along the way, or the
demand that was reproduced at page 196.

BRENNAN J: What do you suggest that leads to? If it should

be relevant for this Court to determine the
question whether the award in clause 31 is or is
not within the ambit of the logs, do you suggest we
should not discover that?

Hoyts(2)	76	3/11/92
MR NOLAN:	No.	What I am saying is that we should have

leave similarly, if leave is going to be granted,
to supply additional material, in fact some written
submissions, if we are able to illuminate this
point in a more satisfactory way.

MASON CJ: Well yes, but there ought to be some time limit.

MR NOLAN:

Indeed, yes. We could do that within 14 days.

MASON CJ: Well, you have got within 14 days to present any

such additional submissions and materials that may
be relevant in response to the materials the
subject of the grant of leave to Mr Merkel.

MR NOLAN:

Yes, thank you, Your Honour.

May it please the

Court.

MASON CJ: Yes, Mr Merkel, we have the second matter.

MR MERKEL:

If I could hand up to Your Honours the outline

of the prosecutor's submissions in the second
matter and can I indicate at the outset that
factual issues have been raised in respect of
grounds 7 to 12 so we will not be seeking to rely

on those grounds. We will be confining our
submissions to grounds 1 to 6.

MASON CJ: Yes.

MR MERKEL:

If the Court pleases, the present application arises as a result of the union entering into a by

consent award approved by the Commission regulating terms and conditions of employment of Greater Union and Village cinemas. Hoyts was not aware of the

matter until it was a fait accompli before the

Commission and then moved by application under

section 113 to set aside the by consent award made
under section 112. The application is set out at

pages 229 to 232 of the appeal book and, in effect,

relies upon the inevitable flow on to its employees

in cinemas of the terms and conditions that arose

in the Village GU award.

The historical basis for the flow-on

allegation is that all three cinema chains had been
parties to an over-award agreement, the Canberra
agreement; in 1988, when Hoyts refused to continue
that agreement disputation arose and the union
settled, in effect, its differences with the
Greater Union and Village organization by award
terms and conditions that were different and higher
than those prevailing at Hoyts cinemas.
The provisions of the Act are fairly clear and

at section 113 requires the Commission to treat the

application as a notification of a dispute~ The

Hoyts(2)

3/11/92

section does not provide any restriction on who may
apply to set aside an award. Subsection (1) says:
The Commission may set aside an award or any
of the terms -

There is separate provision for ambiguity in

subsection (2). The variation power is
circumscribed in subsection (3) where the
application is by an organization or person bound
by an award to reflect particular changes so that,
in effect, subsection (3) suggests that there is no
limit subject to matters I will be putting on who
may apply under subsection (1). But section 113(4)
activates the jurisdiction of the Commission by
requiring the Commission to treat the application
in the same way as a notification of an industrial
dispute. That requires the Commission, under
section 101, to treat the application as an alleged
industrial dispute and to:
(a) determine the parties to the industrial
dispute and the matters in dispute; and
(b) record its findings.
The short point to start the application, by

us, is that the Commission has refused to exercise
that jurisdiction, it having found in its decision
at pages 310 to 317 that there was no standing in
the applicant to make an application under 113. We
say that section 113 requires the Commission to act
under section 101. It has not done so, it has not
considered the matters required to be considered
under section 101, and is able to be the subject of
a mandamus to do so.
Having said that, we do not sit down, because

we accept that as a matter of discretion the Court would not order mandamus if no useful result could

mandamus in such circumstances and also the ensue. That leads us to the second point in our submissions - and I should say the authority for a discretion is R v Commonwealth Court of
Conciliation and Arbitration; ex parte Ozone

Theatres, (1949) 78 CLR 389. I do not need to take
Your Honours to it. In the joint judgment of the
Court, Their Honours indicated the limit of the
discretion on mandamus and indicated at page 400
clearly it would not be granted if no useful result
could ensue.
That then raises the question in paragraph 2

of our submissions. We say that clearly a mandamus
would be appropriate subject only to that
qualification: would a useful result ensue. If
the situation we have defined in the material and

Hoyts(2)

3/11/92

which is the subject of the application is not
capable as a matter of law of giving rise to an activated for the purpose of the Commission finding
industrial dispute, we would not be asking the
that there was no capability in law to create such
a dispute.
The question then, in our submission, is

whether the dispute as defined by section 4(1) is
capable of arising as a matter of law. Those words
are the words in effect, "capable of arising", used
by Sir Owen Dixon in Portus' case. That is the Air
Pilots' case. It is R v Portus; ex parte
Australian Air Pilots' Association, (1953)

90 CLR 321. I will take Your Honours to that case
in a moment, but that was a case where Qantas
served a log on other employers and the union.
The question arose as to whether the employer was capable of creating an industrial dispute with
other employers, and in a very strongly divided 3-2
decision, the majority consisting of
Sir Owen Dixon, Justices Taylor and Fullagar
agreeing, said there was no capability to create a
dispute with another employer. Their Honours
Justices Webb and Kitto, in two separate dissenting
judgments, found there clearly was.
His Honour, at page 330 at point 2, stated the

question:
The result is that it is capable of giving rise to an industrial dispute as
between the respondent company and the
prosecutor association.

The majority found that there was a capacity to
create a dispute, not between employers, but
between employers and the union. We say the

question therefore arising in the present case is
one of capability to create an industrial dispute.
Could I -

GAUDRON J: And on that question, related matter, would it

be the same dispute with the employers as with the
union, and is it necessary that the matter demanded
of the employers is the same as that demanded of
the - as it were, notionally demand that the
employers is the same as that notionally demanded
of the union?

MR MERKEL:

Your Honour, we say that variation in demands

will only set an ambit which is wider on the nature
of the dispute, but may I state at the outset that
this case raises the more difficult question of
defining a dispute where there are no logs of

Hoyts(2)

3/11/92

demands but there is, what we say, a real dispute
in the industry as to the terms and conditions that
should regulate employment of employees of the
major employers in the industry, so that in the
present case the ambit of the dispute is not one
fixed by paper, but it is one to be fixed by
reference to the nature of the disputation that has occurred in the industry as defined by the Act. So
that there is no log as such by Hoyts on Village GU
and the union other than the application to set
aside the award and the basis for that application.

GAUDRON J: Yes, I understand that. What I am thinking,

Mr Merkel, is this: for a dispute to exist as such,
there must be something to which the other side can
accede. Whether it is a demand or a notional
demand, there must be something to which they can accede and it seems to me that one of the aspects
of the argument that you would put is that what the
employers could accede to might be quite different
to what the union could accede to, so that if you
had a dispute with other employers it might not
necessarily be precisely the same dispute as you
would have with the union.

MR MERKEL:

Your Honour is absolutely correct and that is

the underlying anomaly that is created by the
approach of the majority in the Air Pilots' case,
that the employers, to create a dispute with the
union on the decision in the Graziers case, would
be restricting the dispute to the members of the
union in the industry, not employees in the

industry. On the other side, the union can create,
on the basis of Burwood Cinema and Metal Trades, a
dispute in respect of employees who are members and
non-members of all major employers in the industry
and thereby establish an industry award between the
disputants.
The anomaly that arises from what Your Honour

has just put to me is that an employer who has the

the union interest in respect of wages and identical interest, in effect, the reverse side of
conditions of its employees and those of other
employers with whom it is in competition or, more
precisely, are engaged in the same industry doing
essentially the same work, is that unless they are
capable in law of establishing a dispute with other
employers, they can never resolve the true dispute
that arises because the fact of union membership is
irrelevant to the dispute.

It is a limiting factor on their ability to
create a dispute with the union, but it is, as a
fact, irrelevant to the terms and conditions of
employment, and we say that if there is a
legitimate interest of the union in securing higher

Hoyts(2)

3/11/92

terms and conditions for employees whether union
members or not, there must be a countervailing
legitimate industrial interest on employers, the
subject of those claims, to meet that situation and
to meet it at its widest, in the present case, in a
situation where an employer is moving to prevent a
situation arising where it will be in a dispute
after the event, so that an industry standard is
set in the Village GU award which is then used as
the vehicle to uplift the conditions of the
employment in the Hoyts' cinemas.
The only way the employer can deal with that

situation is by creating a dispute to ensure that
other employers who employ union members and
non-members are subject to the same determination.
So in that way the Commission exercises its

function to prevent and settle the industrial dispute in the industry by reference to those
disputants - we do not go beyond that - which is
exactly the function that the union has invited it

to do in the present case. The union had a dispute
with the three employers in respect of all their

employees. They can either pick them off, as they
have, two and then one, or, alternatively, have
them all dealt with together.
We say that the way in which the union

operates cannot alter the constitutional or the
statutory definition of the dispute that has so
arisen and there is probably no better
demonstration of that than the anomaly that arises
in the present case.
On the decision in the Air Pilots' case, the

employer, Hoyts, could create a dispute with the
union in respect of its members and it could, it
would seem, create that dispute in respect of its
members working in the industry because that is the

reverse side strictly of the metal trades coin.
In seeking to set aside the Village GU award,

if the only legitimate dispute able to be created,
as a matter of law, was between Hoyts and the
union, which is an organization bound by the award
then, even on the narrowest finding, that would be the dispute. That would involve Village GU not as
disputants but as parties affected because it is
their award.
We would say that to go through that tortuous

course indirectly to involve all the parties who
are essentially parties to the same dispute is, we
say, the result of the line of cases that started,

in effect, with the Air Pilots' case saying that

Hoyts(2)

3/11/92

employers cannot create disputes with each other
because they are not in an industrial relationship.
We say that, in substance, they are truly in

an industrial relationship in the relevant sense
because the terms and conditions on which each
employs their employees are vitally affected by the
terms and conditions on which others employ their
employees and that is a direct line to a
disputation on industrial matters within the
employment relationship of each employer and its

employees. So we say that that is the issue so
raised.
If I could take Your Honours briefly to the matters raised in paragraph 2 to show the basis on
which it is submitted that the facts as they have
arisen are capable, as a matter of law, of giving
rise to a dispute.

GAUDRON J: And the parties?

MR MERKEL:

We have defined the parties, Your Honour, to the

dispute, at the top of page 2, as the relevant
employers, which are Village, Hoyts and GU.

GAUDRON J: And the union?

MR MERKEL:

Yes, and the two unions, Your Honour; there is

the employees and the managers' union. We have
deliberately said, "That's not exhaustive.",
because there is, in fact, before the
Commission - - -

GAUDRON J:	The subject-matter?
MR MERKEL:	The subject-matter, Your Honour, as defined by

us in paragraph 3, is the terms and conditions - if
I can use the word "about", mindful of what
Your Honours said in the Shell case - that should

regulate employment of employees performing
essentially the same work at Hoyts, Village and
Greater Union cinemas.

We say that is the subject-matter. I should

be more precise in this sense that it is the award
terms and conditions raised in the various claims
in the Village GU award and the claims that have
been made against the union in Hoyts. So that, in
effect, I do not go back to the situation I was in
in clause 31. It is not about any employment
conditions. It is about the minimum award
employment conditions, the subject of disputation,
which are able to be identified in the Village GU
award and in the proposed Hoyts award and the
proposed union award at Hoyts. They relate
essentially to award conditions.

Hoyts(2)

3/11/92

GAUDRON J:

Why is it not just the same as - the other side

of the coin, as it were, of what is said to be a
sympathy strike which does not really give rise to,
it is said, an industrial dispute?

MR MERKEL:

No, Your Honour.

We say the way it was

expressed by Justice Fullagar in Graziers, the
explanation of metal trades, is that the union has
an interest in ensuring that employers in an
industry do not employ employees on less favourable
terms than those that it seeks for its union

members. We say His Honour Justice Fullagar in
Graziers said that in the same way as a union can create such a dispute, it must follow an employer can equally create such a dispute, but the
employer's interest is the converse. It wishes to
avoid a situation arising where demands will be
made on it to have its terms and conditions at the

higher rate sought by the union. The vehicle by
which the union becomes interested is a log served
on employers in the industry to get an industry
award.
We say that it cannot be right in principle to

say that the employers who have the counterpart
interest have no capacity in law to create such a
dispute with other employers and the unions,.
because the union being representative of its
members cannot be the sole recipient unless that is

wrong. And this case shows why maybe that
principle is too narrow because the union, in
seeking to establish its terms and conditions in
the Village GU award, did so in the interest of its
members and non-members. It would be ironic, and
certainly anomalous, if the union could act in that
capacity in setting the industry standard, but then
could not be served in the same capacity by an
employer who is at immediate risk and peril by
reason of that industry standard, because there can
be no doubt that what Your Honours are seeing in

this Court in the earlier case in the Hoyts
matters, is the Village GU as the standard sought
by the union to become the standard, in effect,
within Hoyts with such variations as may apply.

We say that is the central issue. The

question therefore is: is there any reason in
principle why as a matter of law, given three
circumstances which we have identified in
paragraph 5 of our submissions, why the Court
should approach this, in effect, as a legal
conception as opposed to an industrial conception

which we say it truly is. We do not say that it is
necessary to deal with this matter by overruling

the decision in Air Pilots. We say that three
different features that have occurred require
reconsideration of the matter, but the first we

Hoyts(2)

3/11/92

have said is the decision in Shell, noting that the
definition of "industrial dispute" is a wider one.
In fact, we would submit when one examines the

second limb of section 4(l)(b), where a situation
that is likely to give rise to an industrial
dispute of the kind referred to in paragraph (a)
may go close to the full constitutional width of
section Sl(xxxv), and we say that is at the very
worst put against us, the situation that has arisen
by reason of the Village GU award and our
application to set it aside on the grounds there
set out.
The second matter we say is that Coldham's

case, by adopting and accepting the popular meaning
of industrial dispute, must raise a question about
whether the legal conception given to it, for
example, in Air Pilots' and also Moore's case which
related to the metal trades industry, where in
Moore's case what had happened is the union had
created a dispute with private and public sector in
metal trades, then served variation applications on
the private sector employees and created the metal
industry award and then used that to create the
same standard in the public sector which was the
metal trades award.
The Court held that the public sector

employers could not intervene as parties in the
metal industry application, even though they would
be the subject of a flow-on almost inevitably. We
say the issues raised here are quite different in a
factual sense, but underlying - the essential
question is: what is the industrial dispute
created in the present case and can it be right,
given the industrial dispute conception in its
popular meaning, to say that anyone popularly in
that meaning could really suggest that there is not
a dispute between Village GU, Hoyts and their
employees and the union as to the terms and

conditions in Hoyts cinemas? Village and GU are
here. They are also intervening in the application
by Hoyts in respect of its award dispute with the
union, because each is vitally affected by the
other.
Clause 47 of the Village GU award, which is in the application book at page 74, links directly the
two matters. If I could take Your Honours just
briefly to that: the Village GU being conscious
of it having set the standard but not wanting to be
bound by it if its competitor is not uplifted to
it, at page 74 reserved itself the right and the
union accepted that the outcome of matters
involving Hoyts and related companies and the union
presently before the Full Bench may require review

Hoyts(2)

3/11/92

of the industry standards and the union is not to
object to such a review being available.
So we say that on any view of the popular

conception of what is an industrial dispute, it is
not reasonably open to suggest that this industry
is other than in a situation where there is, to use
the wording of section 4 as we have expressed it at the top of page 2 of our outline, at the very least
a situation likely to give rise to actual
threatened, impending or probable dispute.
The third matter that we say requires

reconsideration of this matter is raised by
Your Honours the Chief Justice and Mr Justice Deane

in Wooldumpers. Your Honours there commented, in
the two passages we have referred to at the bottom
of page 2, on the question of whether full regard
and meaning has been given to the prevention aspect
of the constitutional power under section Sl(xxxv).
We say at the very worst against us, this must

be a classic case of where an employer is seeking
to prevent the disputation by moving at its source

to attack the Village GU award. So we say that
those circumstances separately, but more so
punitively, give rise to considering whether it can
still be correct to say that as a matter of law an
employer is not capable of raising an industrial
dispute with other employers to get an industry
award.

DAWSON J: Where is the threatened dispute?

MR MERKEL:

The threatened dispute, Your Honour, is that if

it is accepted that the Village GU sets the
industry standard, it creates the pressure and is
the very vehicle the union is using to create
changes in terms and conditions at Hoyts' cinemas

on the same subject-matter - - -

DAWSON J:

The threatened dispute is between Hoyts and its

employees?

MR MERKEL:

The union - the threatened - - -

DAWSON J: Demanding the conditions which Village has got.

MR MERKEL: There are two views: there is the narrow view

which is the threatened dispute as between Hoyts,
its employees and the union; but the wider and
proper view, which we say is correct, is that there
is only one dispute; there are not separate
disputes, they are different parts of the one
dispute. When the union, having its proceedings on
foot for an award in the Commission at Hoyts'
cinemas, issues a log on the Village GU cinemas to

Hoyts(2)

3/11/92

set an industry standard, we would submit that, in
the circumstances, the real dispute is between the
employers, their employees and the union as to the
industry standard.

GAUDRON J:

Can we ignore the fact that there is a dispute

between the union and Hoyts? We have just spent
half the day listening to argument about it so we
know there is a dispute, in any event.

MR MERKEL:

Your Honour, that is correct.

But that is part

of a wider dispute, it is only one fragmentation of
it.

GAUDRON J: Well, that is the question, is it not? Not

whether this is a situation likely to give rise to

a dispute, because we know there is one. The
question is has the dispute that we know existed
between Hoyts and the union coalesced with the
dispute between the union and the other companies
so that there is, in truth, but one dispute?

MR MERKEL:

Your Honour, we would say "Yes" but we would put the question the other way.

We say that from the

moment the Canberra agreement was not renewed by
Hoyts, from that moment there was but one dispute and that is the award - - -

GAUDRON J:

Now, is that a submission you have ever put to

anybody before today?

MR MERKEL:

Your Honour, in these proceedings prior - yes,

Your Honour.

GAUDRON J: Anyone charged with any authority to deal with

the dispute?

MR MERKEL: In the Commission, yes, Your Honour. There is

an application currently in the Commission to
consider whether there is an industrial dispute
concerning enterprise agreements with some 500-odd

employees and whether there was a dispute between
Hoyts and its employees.
The substantive submission was that starting

with the Canberra agreement and, indeed, if
Your Honours look at the transcript of the
application before the Full Bench in the present
case - which I will not ask Your Honours to read
but I will give you references to it - it is clear
that at every turn in the Commission, whether it be
in the Village GU aspect or whether in the Hoyts'
aspect, the Canberra agreement became the starting
point for the events that led to these
circumstances.

Hoyts(2)

3/11/92

It has not been formulated, other than very
recently in the Commission in the way we say it is
but that is because, Your Honour, the conception
has been set by Air Pilots, by Moore's case - - -

GAUDRON J:

I do not think Air Pilots has got anything to do

with the proposition that separate disputes have
coalesced into one or that the dispute finding is
deficient in that, really, the parties to the
dispute should have been so and so.

MR MERKEL: But, Your Honour, there has been no dispute

finding. We are here because we say we - - -

GAUDRON J: Have you ever asked the Commission to find that

there was a dispute between the union on the - the

one dispute, going back to the Canberra agreement,
between the union and the employers, instead of two
disputes.

MR MERKEL:

Our application before Your Honours is for

mandamus to require the Commission to consider that
matter for the first time, arising out of our
application in the section 113 proceedings. In
other words, if our mandamus is correct as a form
of relief, and if Your Honours find, and this is as
far as it need go, that mandamus would not be
futile, the question then for the Commission is to

consider that very matter. We are not asking
Your Honours to make a ruling or a finding on those
matters.

GAUDRON J: But have you ever asked the Commission to

consider that matter in terms.

MR MERKEL:

Not - in these proceedings, Your Honour, at the hearing before the Full Bench the argument was

directed to standing to make an application, and
authority was referred to, and many of the
authorities which we are raising before

Your Honours, but we say that in substance the

Commission, on the basis of Air Pilots, Moore and

Isaac's case would not see itself as having it open

to it to say we have standing to make an
application in respect to the Village GU award, so

that the question does not, and cannot arise in the

Commission until it has been required to consider

it in accordance with law, which is the very

subject-matter of the mandamus application we are

making to Your Honours.

It is that finding that we say they are refusing to exercise jurisdiction in respect of,

under section 101. Section 113(3) compels them to

take that step unless we have no standing - - -

Hoyts(2)

3/11/92

GAUDRON J: Well, the best you can suggest though, is it

not, is that the Commission should embark on an
inquiry as to whether there is one dispute rather
than two disputes?

MR MERKEL:

Yes, Your Honour, and if we are successful in

the mandamus, that is as far as this matter would
go. It would then go the Commission to determine
whether the alleged dispute alleged by us to exist
in our application is in fact a dispute, and who
are the parties to it. It may, for example, find,
without having to transcend the width of the ground
in Air Pilots, that there is a dispute between
ourselves and the union arising out of the
conditions in the Village GU award, and therefore
that gives us standing to challenge that award
under the general discretion.

GAUDRON J: I am not too sure that that follows, but what I

do strongly suspect is that you are asking this
Court to issue - to give prerogative relief in
circumstances where you have never asked the
Commission to undertake that formal foundational
step that you say gives rise to whatever it is -
standing.

MR MERKEL: But, Your Honour, our application was nipped in

the bud because we were told we had no standing to
make an application - - -

GAUDRON J: But you did not suggest there was a dispute, you

asked that they withdraw the award.

MR MERKEL:

We asked, Your Honour, for section 113 relief to

set aside the award, then there was an application
by the unions, as I understand it, that there was
no standing to make such an application, and the
Commission ruled there was no standing to make that application, and as a result, it never got past
subsection (1), it never got to subsection (3). It
did not treat the application as one that was
capable of being made by Hoyts under the Act.

DAWSON J: If I can just put it another way; why in any

event should the award be set aside? There may,
even if there is the one dispute, it may
nevertheless have been arbitrated in part by the
award. You are free to give notification of the
same dispute, another part of it, and to have that arbitrated. Why are you entitled to have the part

that has been arbitrated set aside? I am referring
to the SEC case. A dispute can be dealt with
piecemeal, and if it is dealt with piecemeal by one
of the disputants it does not give you the
standing, as another disputant, to come along and
have the award set aside as opposed to having your
part in the dispute dealt with.

Hoyts(2)	88	3/11/92
MR MERKEL:	Your Honour, there are two answers.	The first

is, if we had a statutory right, and I must assume
for the purpose of answering Your Honour's question
that we have such a right, then we are entitled to
be heard on our application, the substantive basis
is that the Village GU award breached national wage
principles and it ought never to have been entered
into by reference to the Act.

DAWSON J: But in the SEC case where the SEC wanted to

appear and put submissions in that part of the one
dispute that involved the Electricity Trust of
South Australia, it was refused permission even to appear.

MR MERKEL:

Your Honour, we would say the second part of our

answer is that we would challenge whether that -
whilst that decision may have been correct because
it was conceded it was not a party to the
application, we say that what we are dealing with

is a different situation. We say we have a
disputation arising at the very least out of the
making of the award as a vehicle towards setting an
industry standard.

DAWSON J: That is exactly what the SEC said, what you are

saying; that if the Electricity Trust of South
Australia is given terms and conditions they will inevitably flow to the SEC which was a party to the
same dispute. It was refused permission to appear.

MR MERKEL: But, Your Honour, the application in that case was put on the basis that this was a variation of the original award, not a new dispute, and if it

was a new dispute it would be an intrastate

dispute. We are saying, Your Honour, that what
arises, on any view, and we do not have to put it
any higher than this, is that after the Village GU
award was made a new dispute arose, because it
became the vehicle or the situation out of which an

the union's vehicle for achieving it and, in that industry standard was sought to be set. That was
sense, it is a question that is quite different
from the SEC case because the SEC case,
Your Honour, did not deal with the question and
Moore's case, dealing with the Metal Trades
Industry, accepted that there may be a separate
dispute, but that did not give the disputants to
that wider dispute the right to participate in the
proceedings in the narrower variation part of the
old dispute.
We are not participating and not saying that

the proceedings are vitiated in respect of the

Village GU award because we were not there. We
accept the starting point as we must as the making

of that award. We say the Act empowers the

Hoyts(2)

3/11/92

Commission to set it aside on application. We say
that -

DAWSON J: This is really the same argument.

You wanted to

set it aside because you say the conditions will

flow on to you. The SEC wanted to appear because
the conditions which might have been given by

variation would flow on to it. But it was said you
could deal with these things piecemeal.

MR MERKEL:

Your Honour, we do say - what Your Honour says

is correct, but it is not the way in which it arose in the SEC case, or it is not the way that it arose
in Moore's case. Both of those cases were an
application by an employer to intervene or to be a
party, more accurately, in the proceedings for

variation. We are coming after the variation and
saying the effect of what has - after the award,
which is the equivalent of after the variation, and
saying this award has created a situation, given
the context in which it is made, where there is
likely to be a dispute by reason of it and the flow

on. We are entitled to be heard on whether that
does create a dispute. What we say is we have not
been heard on that matter, because the Commission
takes the view we do not have standing to make the
application and therefore there is nothing to hear
us on.
Our response is as we have put it.

Subsection (3) sets out a mandatory procedure and
we are entitled as a matter of right to mandamus
unless disqualified by some discretionary ground.

DAWSON J:

So that what the SEC ought to have done is to sit

tight, wait till the variation was made and then
move to set it aside.

MR MERKEL:

Your Honour, we would submit what the SEC could

have done was to issue a claim on the other
employers and the unions concerned in respect of

that matter and sought to have them both heard
together, saying that there is no fragmentation of
disputes or there is but one dispute, and it is the

wider dispute. We say that whilst it is not
directly raised in this case, it would be wrong to
accept that one dispute can properly be fragmented
into several separate disputes as if each were

separate in their own right. We say that there
should be prevention and settlement of the one
dispute.

BRENNAN J: What is the meaning of paragraph 6 on page 230

of your application which says:
Since 1988 the applicants have been attempting
to have made an award relevant to their

Hoyts(2)

3/11/92

operations and binding only upon the
applicants.
That is only part of this one dispute, is it?

MR MERKEL:

Yes, Your Honour.

BRENNAN J: It looks very much like a dispute that stands on

its own feet, does it not?

MR MERKEL:

Your Honour, it depends on when one starts and

stops. Prior to the making of the Village GU
award, a problem arose out of the Canberra
agreement and Hoyts not continuing. That led to
industrial disputation in Hoyts which led to the
proceedings in the Commission. That, Your Honour,
is just a step in the chronology which explains why
the making of the Village GU award will give rise
to a situation in Hoyts which will create a demand
for, in effect, the industry standard.

BRENNAN J:

I confess to some difficulty about this

discussion on disputes. It seems to be a concept
that lacks any specificity. As I understand the
theory - and perhaps I am wrong - it is found when
there is a demand which is susceptible of being
acceded to which is not acceded to, the parties to
the dispute being those who are involved in some
respects in relationships of employer and employee.
Is that a wrong understanding of dispute?

MR MERKEL:

Your Honour, that is a correct understanding of

a paper dispute, but we say it is not an exhaustive
definition of a non-paper dispute.

BRENNAN J: Then could you tell me what it is in relation to

the term "dispute" in Sl(xxxv) which is able to be
used to distinguish paper disputes from other
disputes?

MR MERKEL:

Your Honour, it has been the subject of
discussion in a number of the cases I want to take
Your Honours to, but as I understand the
development of the law and the recognition, it has
been that the paper disputes are, in effect, the
ultimate in artificiality but accepted as capable
of creating a dispute which, because they amount to
a demand and a refusal, are clearly able to be
defined.
The problem becomes more difficult when you have no less a dispute by reference to what is
occurring in the field, by reference to demands and
conditions which are giving rise to changes in
conditions which are not clearly formulated but are
no less industrial disputes. Indeed, probably the
better way of answering Your Honour is by what this

Hoyts(2)

3/11/92

Court said in Reg v Portus; Ex parte Neil, 105 CLR
537. Could I take Your Honours to that, because
Their Honours give a far better answer than I could.
May I say by way of completeness before I go

to that passage, the 1988 strikes at Hoyts arose
directly as part of an endeavour to have Hoyts
continue the Canberra agreement, so we say the
chronology starts, in effect, with the Canberra
agreement carrying it through, but I will come back
to those matters which I have dealt with in
paragraph 2.
In the joint judgment at page 544

Their Honours considered the second kind of
dispute. At point 4 on page 544 Their Honours say:
The answer to this lies in the facts: there
was a very distinct disagreement about a whole
subject matter backed by a preliminary resort
to or threat of industrial dislocation.

We would say that that was the 1988 situation in
Hoyts.
An industrial dispute may exist without a
formulation of a definite and clear cut demand
followed by an equally definite and clear cut
refusal. Familiarity with paper disputes
consisting of carefully drawn logs of demand
and general refusals has perhaps led to a
somewhat artificial conception of what amounts
to an industrial dispute. But an attempt to
gain higher rewards by means first of
negotiation and then of pressure and
threatened dislocation is no less an
industrial dispute because the exact stand
taken by the respective parties may be less
definite and precise than a paper log would be
apt to make it.

Then could I go over to page 545 where at point 8
Their Honours say:
All this may, for the purposes of this case, be put on one side with perhaps the remark that if you do get a real dispute manifesting the desires or the demands of an indefinite
group in industry, the difficulty or even the
impossibility of identifying all the
disputants could not take the case out of the
constitutional power conferred bys 51(xxxv).
The reason why the argument described may be
put on one side is that in point of fact the
dispute found by the Commissioner to exist,
the settlement of which he has taken under his

Hoyts(2) 92 3/11/92
authority, is not with the voluntary
association as a party principal representing
an indefinite and changing industrial group:
it is a dispute with defined existing
employees.

Could we emphasize that passage because we say that
the question for the Court is not, "What is the
dispute? and is our definition of it as a matter of
fact correct?" What we say is, "Is there any
reason why, as a matter of law, the dispute as we
have said it is is not capable of arising in the
circumstances?", because we say the Commission,
under section 113(3) and then section 101, is
required to consider that matter?

GAUDRON J: That is a construction which obviously favours

your position. It is not necessarily one that
leaps to the reader, Mr Merkel. If you look at 113
you have "as far as possible". If it is not a
separate dispute, although it might be that the
procedures can possibly apply in a general way,
there is no reason why one should go along and
ascertain whether there is a dispute and who are
the parties, more particularly if it is not
asserted that there is a dispute. If all that is
asserted is that you have a right to appear to
argue that an award be set aside, if you do not
say, "and there is a dispute", and you do not
notify the Commission of a dispute, then I really
do not see why you think that 113(4) requires the
Commission to go along uninvited to determine whether or not there is an industrial dispute.

MR MERKEL:

Your Honour, what Your Honour says, with

respect, would be correct if the assumption in
113(4) was that there was an industrial dispute, as
against an alleged dispute. Section 113(4) says

the application constitutes the notification. So
that what has occurred in the present case is as

soon as we have become aware of the problem, we

have moved under section 113(1). The Act says
that:
This Act applies in relation to applications,
and proceedings in relation to applications,
for the setting aside of variation of the
awards in the same manner, as far as possible,
as it applies to industrial disputes and
proceedings in relation to industrial
disputes, and for that purpose such an
application shall be treated as if it were the
notification -

What we say, Your Honour, is that we have got to
the stage now of saying that under section 113(4)
we are entitled to put to the Commission that the

Hoyts(2)

3/11/92

alleged industrial dispute stated and identified in
our application is, in fact, one that is an

industrial dispute. We never got to that stage

because the Commission, on the application of the
union said, "There is no application under
section 113(4) because Hoyts are an incompetent applicant", and the Commission upheld that. So
that they said that we never get to 113(4).

DEANE J: But is that quite fair to the Commission? I mean,

if you look at pages 314 to 315, what they did was
they tied section 33 and section 113 in together
and they then considered what seems to have been
the only basis for your client having standing that
was put to that, and that is - well, it is rather
hard to work out what it was but it certainly does
not seem to have been that the award was made in
settlement or in part settlement of one dispute
going back to the abrogation of the Canberra
arrangement.

MR MERKEL:

Yes, but, Your Honour, it is true that the

Commission dealt with it on standing, but can I

take Your Honour to page 239. The proceedings in
the Commission were dealt with on the more general
basis. We say it is wrong, in effect, to say that
this was purely a question of standing.
My learned friend, Mr Nolan, put his

submission at page 239, lines 4 and 5, saying that
Hoyts are not party to any dispute which they now
seek to set aside. There is a reference at the
bottom of the page to Moore's case, in effect
permitting fragmentation. Likewise there are
similar submissions at page 242 and there is
discussion of Moore's case, in effect, for the
purpose of saying, "We don't get to the threshold
point", but we say that the submissions range wider
than just: is section 33 complied with or not?
For example, the background to all this was gone
into, at page 276.

DEANE J: Yes, but do we not have to start with page 314

where the Commission says if you were parties to
the award you would have been able to apply and
they will assume that if the award was made in
settlement, for which include part settlement, of a dispute to which you are a party, you have standing
to apply, but that you have conceded that you are
not parties to the award and that you were not
parties to the dispute in pursuance in settlement
of which the award was made.
Well, now there is obviously room for a

further argument which I understand you to put, but
it seems to me there that you have conceded

Hoyts(2)

3/11/92

yourself out of the proposition that you were
discussing with Justice Gaudron.

MR MERKEL: With respect, not, Your Honour, what the

concession there stated is that we were not parties
to the dispute generated by the service and
rejection of the log.

DEANE J: But, unless the Commission is not doing its

function in giving its reasons, implicit in that is
that when all this was being discussed it was not
suggested that the award was not made in settlement
of the dispute arising from the service of the
particular log but was made in settlement of some
wider dispute coming about by abrogation of the
Canberra agreement.

MR MERKEL:

Your Honour, that is correct, but our starting

point, Your Honour, but our starting point was the
finishing point of the proceedings in respect of

Village GU. We do not say, Your Honour, and we do
not need to say, that prior to the making of the
award we were in dispute, or there was a relevant

dispute involving us. Our application is entirely
based upon the moment after the making of the
award, then our application to set it aside. The
question is, are those circumstances, on the
grounds set out, capable of constituting a dispute.
The Commission never got to that, Your Honour.

DEANE J:

I follow that and the Commission has denied that,

but I was simply taking up the discussion between
yourself and Justice Gaudron.

MR MERKEL:

Your Honour, the question, in our submission, does come down to whether or not section 113(3) is

a matter of obligation of the Commission, and if it

is, whether we are disqualified from seeking relief

by way of mandamus, and we would say that any

narrowing or inadequacy of argument or any narrow

basis of argument before the Commission would not,

and should not, be disqualifying because the

argument was directed to standing and that was

preliminary to whether or not there was an

application that was to attract the jurisdiction

under section 101.

We never got to that point.

But we would say not too much should be made of the more limited basis on which the Commission dealt

with it, because it made no difference,

Your Honours.

We say the Commission took a very firm view

that there was no right to make the application and

that was the end of the matter. Now, if that view,

as a matter of law, is correct, then we must fail,
but if that view as a matter of law is not
necessarily correct, and we say it is not for the

Hoyts(2)

3/11/92

reasons we seek to enunciate in our submissions,
then we have never been heard in respect of whether
there is a dispute, and we say that is the issue
sought to be raised by us.

DEANE J:

I follow that, but just so we can be precise,

would you tell me this: would you agree that the Commission has dealt with the matter on the basis
it itself has said in the paragraph going from the
bottom of page 314 to the top of page 315?

MR MERKEL:

That appears to be the basis on which the

Commission decided the matter, Your Honour.

DEANE J: Which means that your argument must be that your

standing exists under section 113 with or without
section 33, et cetera, even though you do not come
within that paragraph.

MR MERKEL:

Yes, Your Honour.

We have our argument put on

two alternative bases. The first is that it cannot
be right to limit an applicant under section 113 to
a party to a dispute, because the application
requires as a first step to determine who are the

parties to the dispute. So that section 113 within
itself is inconsistent with the notion that it can
only be made by parties to a dispute.

DEANE J: Except what the Commission would say, I apprehend,

in answer to that is: if the application is to vary
the award, you just do not say "a dispute"; you
say "the parties to the relevant dispute", and the
relevant dispute is a dispute in settlement of

which the award was made. I understand that you
contest that but that, as I follow it, would be the
Commission's line of reasoning.

MR MERKEL: But, Your Honour, that line of reasoning does

not take them out of the circularity of the
consequence, because if it can only be parties in

settlement of the dispute that led to the award,
there could be no occasion to have to determine, as
the section requires, whether the alleged dispute
in fact is a dispute. In other words, section 101
negatives a limitation of that kind on section 113.
That is the first point.
The second point that we would put is that we

say there is no reason in principle to give a
narrow definition to section 33 and, indeed,
because of section 101, it would seem to be an
extraordinary result that you could not apply for a
variation or to set aside an award because you are
an alleged disputant because the Commission decided
you are not an actual disputant, when that is the

Hoyts(2) 96 3/11/92
matter that section 113 requires to be determined
under section 101.
We would submit - and this is put in our

alternative submissions - given the wide function
of the Commission to prevent and settle disputes
that they find to exist, it would be an
extraordinary consequence to limit applications in
effect to parties bound by an award or parties to
an industrial dispute in a narrow legalistic sense,
because that may prevent resort to the Commission
by parties who wish to have a finding that they are
parties to a dispute.
So we say that the real point of our

submissions at paragraphs 6 to 8 about the way in
which section 33(b) should be approached is that
there is no need to construe it narrowly or
exhaustively of the persons who may make
application. Those matters can go to the way in
which the discretion to deal with the matter should
be exercised. There is no logic or principle
underlying the Act to limit people who may resort
to the Commission by reference to a legalistic
conception of parties to the dispute or parties
bound by an award as the only persons who can
access the Commission.
So we say that those matters do not go to

standing, but they would be certainly relevant to
discretion, but we have never got to that stage.

So that is the alternative way. So that, even if
we were not party, we say section 33(b), in
combination with the matter under sections 111 and
113, ought not to exclude us from making
application. And probably, whilst I have jumped
ahead, the best indication of why that ought to be
so is if one looks to the sections of the Act which
require the Commission to have regard to particular
matters - and can I take Your Honours to
section 94. Section 94 does afford us statutory

protection in this sense, that when two major
employers in an industry settle a dispute with a
union:
In determining an industrial dispute, the
Commission shall, subject to section 95,
provide, so far as possible and so far as the
Commission considers proper, for uniformity
throughout an industry carried on by employers
in relation to hours of work, holidays and
general conditions in the industry.

Now, if you have an industry award and one employer
is fragmented out of it, and it wishes to put to
the Commission that section 94 has not been
complied with and if we take the extreme case where

Hoyts(2)

3/11/92

the Commission says, "I will disregard section 94",
we say there could be no policy or principle
underlying the way in which this Act should operate
that would exclude another person vitally affected
in the industry from approaching the Commission.

GAUDRON J: Is that a qualification; that it is vitally

affected? As I understood your earlier argument,
directed to section 113, it is anyone at all, off

the street, can apply. And then I thought perhaps
when you married it up with 33 it was anyone who
was party to any dispute can apply.

MR MERKEL:

No, Your Honour.

GAUDRON J: But now, is it, anyone who was vitally affected,

can apply?

MR MERKEL:

No, Your Honour, the submission I just put on

paragraphs 6 to 8 was on the assumption that we are

not a party to the dispute. It is an alternative
submission and what I -

GAUDRON J: Well, can I take you back to your first one.

What is it, on your first argument, that entitles
you to apply to have the award set aside?

MR MERKEL:

We say that under section 113, any person who

alleges that there is an industrial dispute in
relation to an award arising from its making and
alleges that it is a party to the dispute, is
entitled to apply - - -

GAUDRON J:

Even though it is not the dispute that led to

settlement?

MR MERKEL:

It must be so, Your Honour, because section 101

requires the Commission to then determine whether
that person is, for the purposes of that
jurisdiction, a disputant because, because

section 101 is attracted, the application requires
the Commission to determine the subject-matter of
the dispute and its parties so that we say, for
that reason, any person who alleges to be a
disputant is entitled to apply under section 113
and we say that must follow from the picking up of
section 101.

GAUDRON J:	Now, on your second argument, what is it that entitles you to apply?
MR MERKEL:	If we are wrong, the second argument is that

section 33(b) should not be read as exhaustive of
persons who can make applications and we say that
in any event, even if it is - - -

Hoyts(2)

3/11/92

GAUDRON J: Well then, what is it though, that entitles you

to apply?

What we say entitles us to apply,

Your Honours, is two things: one is that we are a
party to an industrial dispute in the industry,
albeit, as defined by the Commission a different
industrial dispute; or alternatively, we are a
person bound by an award, and therefore we fall
literally within section 33(b). That is our first
submission.
We put an alternative submission: if it is

said that you must be a party to the relevant
industrial dispute which produces the anomaly I
have already identified for 101 because it is yet
to be determined, or if it is the person bound by
the particular award the application is relating
to, then we say that section 33(b) should not be
exhaustive of persons who can make application
under the Act, and there is no reason in principle
to shut out an applicant who can otherwise
demonstrate a sufficient or relevant interest by
reason of the effect the matter has upon them.

GAUDRON J:

Now, it is that third argument I would have

thought that raised a question as to what is

involved in the arbitral power. I daresay one
might, within the confines of the arbitral power,
grant leave to intervene, but it goes back to much
the same issue that was in the common rule cases,

although the other side of the coin: how can
somebody who is a stranger, as it were, have rights
virtually as a party to an arbitrative proceeding?

MR MERKEL:

Can I give Your Honour an example of a stranger

that would not fall within 33(b). My learned
friend, Mr Nolan, referred in his submissions to
where third parties may be affected by an award.

They may be non-parties to the dispute. They may
not be bound by the award, but they may be affected

by it. Superannuation is one example where they
may not have an obligation to perform under the
award, but they could be a recipient of benefits

under the award. We say that 33(b) would shut out
such persons as strangers from seeking relief in
respect of an award that affects them. That is an
example of why we say that 33(b) should not be seen
to be exhaustive.

Another example of a stranger - - -

GAUDRON J: Yes, I follow that.

MR MERKEL: Section 94 is another example, Your Honour. If

a union is seeking to set an industry standard by
reference to a fragmented dispute of the kind that

Hoyts(2)

3/11/92

Justice Dawson put to me, such as in the SEC case,
is it right in principle for the purpose of
preventing and settling industrial disputes but
within the statutory mandate, that a person vitally
affected cannot, in effect, remove or seek to
remove the source of the industrial disputation

about to occur in that person's workplace. I took
Your Honour to section 94 because there could be no
better example than if the SEC saw that an award
was about to be made which was in total disregard
of section 94, and was to be then used as a flow-on
for its terms and conditions.
We say there is nothing in principle why

section 33(b} should shut out a person who may be
seeking no more than to be heard, and we say it is
to approach the jurisdiction to prevent and settle
disputes as if they were litigious matters
justiciable in accordance with statutory or common

law rights. We say that that is the error that has
fallen into this area where one talks of lack of
standing, lack of standing to even allege an
industrial dispute.
Your Honours, what we have done, and if I

could hand it up to Your Honours, is that in our
outline in paragraph 2 I have given transcript
references and exhibit references to show what I
may describe in the flow-on situation, so that this
is not a fanciful or remote possibility; there is
a real issue before the Commission on the question of whether our alleged dispute in fact is one. We
have referred to the Flight Crew Officers Tribunal
decision, which I will not take Your Honours to,
but Sir Garfield Barwick at page 21,
Justice McTiernan at page 24 and Justice Menzies at
page 29, all accepted that an application for
variation can, or in that case did, create a new
industrial dispute. True it is Their Honours were
talking of industrial dispute or question for the
purposes of that particular legislation, but in the
context Their Honours were saying that an

application for variation may arise under the old
dispute or may create or arise from a new dispute,
and we say that, therefore, that provides the basis
for section 101 being attracted by section 113.
We have set out in paragraph 3 the reference

to what we allege the dispute is, and in
paragraph 4 we say the underlying argument against
us must be that an employer cannot be in dispute
with other employers in the industry and the
relevant unions as to the terms and conditions that
should regulate employment of their employees in
the industry.

Hoyts(2}

100

3/11/92

It is Reg v Ludeke, 159 CLR 178. In the joint
judgment at page 182, we say we are the precise
reverse side of the coin identified at point 4 at
182 when the Court said:
And it is a recognition of the reality that
generally lies behind paper disputes - the
desire to create a dispute which will attract
the jurisdiction of the Commission to make a
general industrial award, that is, an award
which will regulate terms and conditions of
employment in the particular industry.

We say that that is the subject-matter which the unions are agitating and which the employers are
resisting in the present case.
What we have sought to do in paragraph 4 is by

reference to the earlier decisions of the Court.
Justice Isaacs, in George Hudson, at 438 to 442;
Justice Starke, at 453 - if I could ask
Your Honours to note to 455; in Burwood Cinemas at 548 to 549, Justices Rich and Evatt; Metal Trades, at page 416, Justices Rich and Evatt and then
Justice McTiernan; and finally, Justices Webb and
Kitto in Portus at pages 330 to 335, all accepted
that disputes between employers can give rise to an
industrial dispute.
In Graziers, Justice Fullagher at 334, said,

"An employer can create a dispute with the union.".
We say that there is no principle that should

justify the converse view. To the extent that
cases have held to the contrary - and the three
cases we have identified are Portus, Moore and
Isaac - we say that they should be reconsidered in
their historical perspective.
What we have done is we have had some short

notes of argument which we had prepared on why it

is that Your Honours should find that Portus, Moore
and Isaacs should not be treated as authority for
the Act under section 4(1) not giving rise to a

right to create a dispute as between employers. We
have committed those submissions to writing and if
I could hand those up to Your Honour and hopefully
I will not have to do any more than just mention

the main points there. If I could hand those up to
Your Honours.

Hoyts(2)	101	3/11/92
MASON CJ:	Thank you.	Mr Merkel, the Court will adjourn now

until 10 o'clock tomorrow morning. Would it be
convenient for other counsel in the case at this
stage to hand in their outline of submissions? In
your case, Mr Rose, an outline of the submissions
you would put in the event that you get leave to
intervene.

AT 4.28 PM THE MATTER WAS ADJOURNED

UNTIL WEDNESDAY, 4 NOVEMBER 1992

Hoyts(2)

102

3/11/92

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established

Ex parte State of Victoria, (1950) 81 CLR 64.	I
wanted to refer the Court to a passage from the

had said. Can I just read the passage.	It is at
point 4 where His Honour said:

held to confer a new power on the Commission.	We
say it is indistinguishable from having to get
leave of the Commission.

of employment, would offend the principles that we	have talked of, but we do not need to go that far
in the present case because this is not a matter of
variation, nor is it limited to variation.
Mr Justice Menzies - - -

really gives rise to the problem, Your Honour.	We
say that one cannot read as much into it as

That is why we say that it goes too far. there were criteria, it could meet what Your Honour	If
has put.

concerned; it goes beyond that, since what is	the terms of the employment of the employees	sought is to confer power on the Commission.
Looked at from one point of view, the dispute
may appear to be as to the employer's power to
dismiss or duty to reinstate in employment,
but since it is intended that no criteria
should be laid down by which the extent of the power or nature of the duty could be
ascertained, it seems to me that what is in
truth sought is an extension of the powers of
the Commission.

condition of any employee, irrespective of the
circumstances.	We say that, notwithstanding what

judgment as if it was a definitive and exhaustive
expression of my opinion of this question.	You

Toohey and also His.Honour Mr Justice Wilson in	joint judgment of Your Honours Justices Dawson and passage from Your Honour's judgment is at page 326.
Wooldumpers, again, related to the reinstatement question and, at point 3 at 326, Your Honour said:

settlement of the original interstate dispute.	We
say that they are ad hoc matters arising in a particular instance which in themselves are not capable of giving rise to an industrial dispute.

where the matter was dealt with in the hearing.	It
is all in volume two. Could I possibly take
Your Honours quickly through the passage.	The

Your Honour.	I have not checked the wording but I
think it was in terms of the undertaking.	I do not

couple of years before the Full Bench of the	Commission, Mr Livingstone, then the Federal
Secretary of the Australian Theatrical and
Amusement Employees Association, which organization
has now become part of my client by virtue of an
amalgamation of that union and two others, wrote to
the presiding member of the Full Bench and, at
page 205 of the appeal book there is the letter
dated 12 May this year where Mr Livingstone said
this to His Honour Justice Boulton:

Commission, a printed order, Print J7883.	The
statement said this:

view the undertaking had been breached.	Of course,
evidence of that is not just present in
Mr Livingstone's complaint.

to preclude a variation, admittedly beneficial to	the employee, taking it right outside the scope of
particular duties to be performed and, say, going to overtime or other payments.

would think, Your Honour.	I suppose the union
could be excused - - -

employees just gratuitously by the employer in the In any event, as a matter of jurisdiction I	context of these disputes.
would not have thought that that would be something
that would be beyond the Commission to regulate
because, after all, awards known as paid rates
awards have been a feature of the Commission's award-making powers and functions accepted by the
parties for decades - I would think at least since 1975 when the national building trades construction
award was made, and such an award was made
specifically at the request of the parties and on
the basis that that represented a maximum as well
as a minimum code for the employment of the employees employed under it.

proposed undertaking and the submissions of the parties relating to the undertaking. In all the circumstances we have decided that the provisions of the undertaking will be included	as a term of the interim award.	The clause
shall provide as follows:

Deputy President Polites to settle the order.	So
the awards made can be seen very much in the context of these ongoing proceedings and, of

because it made the award the way it did.	Indeed,
one of the arguments raised in the course of
these - - -

before somebody is put on, or, in the case of the	an employer to refer to, say, the union secretary and I refer to these cases in my outline - oblige	Victorian Clerks case, to confer with the union
officials and the workers concerned before somebody
is sacked or before a decision is taken to introduce technological change at the workplace.
So, in my submission, this would really be in the
same category as that kind of award in that it
makes a particular step as a precondition for
something ultimately being done.
Now, admittedly it is in very unusual circumstances and it is not an award that the Commission would be likely to make otherwise than
in very much as an interim step along the way to

books do not contain the record of dispute, but	the present award sprang. Certainly the appeal
tracing through the history of these matters of
concern, if one goes to page 150 of the appeal book
one gets some sense of the fact that this
particular issue, the transfer of employment, and
the maintenance of the status quo, if you like,
appeared to be a persistent theme from the very early days of the disputes that gave rise to the
competing contentions in the endeavour to rope in
the subsidiary companies and so on.

it, referring to Commissioner Mansini.	Mr Stewart
goes on to say this:

as an interim measure in the course of settling
whatever may have been the main dispute.	It is not

mentioned there; the question as to whether it was	considered in the case of Re Hegarty which was
exercising judicial power, but no doubt was cast
upon the constitutional power to provide for
matters in the administration and operation of an
award to be subject to approvals by some outside,
so to speak, body.

final award in those terms.	Why could it not make
an interim award?

the union interest in respect of wages and	identical interest, in effect, the reverse side of
conditions of its employees and those of other employers with whom it is in competition or, more precisely, are engaged in the same industry doing
essentially the same work, is that unless they are
capable in law of establishing a dispute with other employers, they can never resolve the true dispute
that arises because the fact of union membership is
irrelevant to the dispute.
It is a limiting factor on their ability to create a dispute with the union, but it is, as a fact, irrelevant to the terms and conditions of
employment, and we say that if there is a
legitimate interest of the union in securing higher

the union's vehicle for achieving it and, in that	industry standard was sought to be set. That was
sense, it is a question that is quite different
from the SEC case because the SEC case,
Your Honour, did not deal with the question and
Moore's case, dealing with the Metal Trades
Industry, accepted that there may be a separate
dispute, but that did not give the disputants to
that wider dispute the right to participate in the
proceedings in the narrower variation part of the
old dispute.