Repatriation Commission v Law

[1980] FCA 92

Re: GARRY ERNEST SHERRIFF & OTHERS
And: LEONARD CECIL TOWNSEND & OTHERS (1980) 71 FLR 51
No. V 12 of 1979
Nos. NSW 26, 31 of 1979
Industrial Law

COURT

IN THE FEDERAL COURT OF AUSTRALIA

VICTORIA AND NEW SOUTH WALES DISTRICT REGISTRY
INDUSTRIAL DIVISION
Smithers A.C.J.(1), Evatt(1) and Northrop(1) JJ.

CATCHWORDS

Industrial Law - declaration that rules of an organization fail to make a provision required by Conciliation and Arbitration Act - scheme for reconstitution - proceedings adjourned to enable organization to amend rules - failure to comply with provisions of scheme - rules not amended - subsequent duty of Industrial Registrar to determine Rule alternations.

Conciliation and Arbitration Act 1904, as amended, ss. 140(5D), (7), (8), (9); 171D.

Industrial Law - Conciliation and arbitration - Registered organisation - Rules failed to make provisions required by Act and Regulations - Scheme under s. 171D of the Conciliation and Arbitration Act 1904 - Effect of non-compliance with scheme - Powers of Industrial Registrar concerning rule alterations - Conciliation and Arbitration Act 1904 (Cth), s. 140(1), (5D), (5G), (6), (7), (8), 171D.

HEADNOTE

In proceedings concerning the rules of an organisation registered under the Conciliation and Arbitration Act 1904 the Court declared under s. 140(5D) that those rules failed to make a provision required by the Act and the Regulations, namely, failed to provide for a federal committee of management. The Court then adjourned the proceedings relating to rr. 1 and 4 to enable the organisation to alter those rules. The Court also approved a scheme under s. 171D of the Act to enable the Federal Council and Federal Executive Committee and office holders to continue to function on an interim basis. The persons authorised by the scheme to resolve upon appropriate rules did not do so. Upon the adjourned hearing date:

(1) Although it appeared the scheme had been deliberately ignored, the Court would defer making a declaration under s. 140(5D) of the Act that rr. 1 and 4 of the Federation Rules contravene s. 140(5D) because of the disastrous effect such an order would have upon the organisation.

(2) The Industrial Registrar should exercise his powers under s. 140(7) of the Act to bring the rules into conformity with the Act.

HEARING

Melbourne, 1980, June 24, 25. #DATE 25:6:1980

APPLICATION.

In proceedings under s. 140 of the Conciliation and Arbitration Act 1904 after the Court had declared that particular rules of a registered organisation failed to make a provision required by the Act, the Court adjourned the hearing to enable alterations to the rules to occur and a scheme to reconstitute the federal committee of management under s. 171D of the Act to proceed.

L. Lamprati, for the claimants.

R. C. Kenzie & G. P. Johnston, for the respondents.

Solicitors for the claimants: A. J. Macken & Co.

Solicitors for the first respondent: Harrison & Partners.

Solicitors for the second to fourth respondents: McClellands.

T.J.G.

JUDGE1

On 13 March 1980 the Court made a declaration under s.140(5D) of the Conciliation and Arbitration Act 1904 as amended, as follows:

"A. THAT the rules of the Vehicle Builders Employees Federation of Australia contravene s.140(1) of the Conciliation and Arbitration Act 1904 as amended in that they fail to make a provision required by the Act and the regulations made under the Act namely they fail to provide for a Federal committee of management."

In his reasons for judgment Northrop J., after referring to the provisions of s.140(5D), s.140(5G) and s.140(6) of the Act, said at pp.9 - 10:

"Section 140(7) makes provision for what is to happen where the Court makes a declaration that the rules of an organization contravene s.140(1) in a specified respect. Often it is a nice question, in the legal sense, as to what order a Court should make in circumstances similar to those in the present case, see, for example, R. v. Australian Industrial Court ex parte Maynes (1978) 19 A.L.R. 669 per Mason J. at 674.

"In the present case the Federation is an organization of long standing. Its Federal Council has existed in accordance with the current provisions of Rules 1 and 4 for many years without challenge. It would be inappropriate to make an order upon which s.140(5G) operates, particularly having regard to the scheme under s.171D of the Act which the Court proposes to approve. In all the circumstances, it is desirable that in Matter V. No. 12 of 1979 the Court should declare that the rules of the Federation contravene s.140(1) of the Act in that they fail to make a provision required by the Act and the Regulations, namely they fail to provide for a federal committee of management, and to otherwise adjourn those parts of the proceedings insofar as they relate to Rule 1 and Rule 4 and are based upon s.140 of the Act for the purposes of giving the Federation an opportunity to alter its rules in this respect. At the same time, the provisions of s.140(7) of the Act will enable the Industrial Registrar to take such action as he considers appropriate pursuant to the provisions of that subsection. To implement this, the Court will direct that a copy of the Order made herein, together with a copy of these reasons for judgment, be delivered forthwith to the Industrial Registrar."

Then later, in referring to s.171D of the Act he said at pp.23 and 24:

"Accordingly, the Court approves a scheme to enable the Federal Council and the Federal Executive Committee of the Federation to continue to function on an interim basis and for the persons presently purporting to hold the offices of President, Vice-president and Trustee respectively, to continue to hold those offices on an interim basis. Until the Federal Council is reconstituted and complies with the requirements of the Act, the Federal Council is not to exercise its power of altering the rules of the Federation, except in compliance with the scheme approved by the Court. After being reconstituted, the Federal Council will be in a position to exercise its powers in full in compliance with the rules of the Federation. The scheme approved provides for a meeting of Federal Council, as presently constituted, to resolve upon the appropriate rules for the reconstruction of the Federal Council. The rules of the Federation, insofar as they lay down a procedure to be followed with respect to an alteration of rules, need not be followed. The only rules to be altered under the scheme are Rules 1 and 4. A timetable is laid down in the scheme and must be followed. If not complied with, the Industrial "Registrar will be in a position to exercise the powers conferred by s.140(7) of the Act."

The Scheme under s.171D required the Federal Secretary of the Federation, within 21 days, to call a meeting of the persons who, according to the rules of the Federation theretofore certified, were members of the Federal Council of the Federation. The business to be conducted at the meeting was, and we quote from the Order made on 13 March 1980 under paragraph 2 of the Scheme:

". . . to resolve upon appropriate rules, according to the circumstances of the Federation, to provide for the constitution of a Federal Council which shall not be contrary to the provisions of the Conciliation and Arbitration Act 1904, as amended, subject to . . ."

specific provisions, which need not be quoted.

The Scheme required the meeting to be held no later than 1 May 1980. The Scheme then provided in paragraph 4 as follows:

"4. The rules so resolved upon at the said meeting shall be deemed for all purposes to have been made by the authorised rule-making authority of the Federation in accordance with relevant procedures laid down by the rules of the Federation."

The Scheme made consequential provisions including a provision for the holding of an election under the altered Rules 1 and 4. The Scheme provided, by paragraph 7, as follows:

"Until the reconstitution of the Federal Council as aforesaid the members of Council holding office pursuant to the rules heretofore certified shall be deemed to constitute the Federal Council of the Federation duly and validly elected and shall have all the powers of the Federal Council provided for in the rules of the Federation other than the power to repeal, alter or add to any rules of the Federation, excepting for the purpose of reconstituting Federal Council as provided for herein."

General liberty to apply was granted and the further hearing of matters V. No. 12 of 1979, N.S.W. No. 26 of 1979 and N.S.W. No. 31 of 1979 was adjourned to 24 June 1980.

The persons authorised by the Scheme to resolve upon appropriate rules to provide for the constitution of the Federal Council have ignored the provisions of the Scheme. The meeting was held on 31 March 1980 but the only relevant resolution passed at that meeting was as follows:

"That a sub-committee comprising of the four (4) State Secretaries or Acting Secretaries and the two (2) Federal Officers be formed, to bring down a recommended formula for the election of delegates to Council, including how the two (2) Federal Officers are elected to Council, how delegates are elected and the voting power of the Federal delegates and delegates, if so elected.

Further, the sub-committee bring down a formula of election of the Officers of Council.

The recommended formulas be forwarded to a further meeting of the Federal Council for endorsement or otherwise."

That sub-committee has never met. No rules have been adopted to provide for the constitution of a Federal Council of the Federation. The persons referred to in the Scheme, in all probability, now have no power to adopt any such rules.

By letter dated 29 April 1980 the Federal Secretary wrote to all Branch Secretaries in the following terms:

"Following the handing down of the Reasons for Decision, in the recent Federation Rules challenge and because of the wide effect the Decision will have on all trade unions, I forwarded a copy to the A.C.T.U.

The A.C.T.U. have now advised that the amendments to the Conciliation and Arbitration Act on which the bench relied, were not, in the A.C.T.U.'s opinion, intended to be interpreted in this manner.

The particular question I draw attention to, was the validity of the rule governing the Federal Officials on Federal Council together with State Secretaries.

"The A.C.T.U., intend within the next couple of weeks, to take action with a view to, if necessary, having the Act amended.

Bill Kelty, the Assistant Secretary of the A.C.T.U., has recommended that we take no action on rule amendments on this particular question, at this time."

In the course of submissions made on 24 June 1980 the Court expressed a tentative view that it considered the Federal Secretary had deliberately ignored the Order of the Court and intended to fail to comply with the provisions of the Scheme. The Court takes a serious view of that conduct. At the request of his counsel the Court adjourned the hearing of these matters until this morning. Nothing has been said today that leads the Court to change its view.

The Court has given consideration to whether it should make a declaration under s.140(5D) of the Act that Rule 1 and Rule 4 of the Rules of the Federation contravene s.140(1) of the Act. If such a declaration is made, then under s.140(5G) of the Act those rules would be deemed to be void from the date of the Order. The effect of such a declaration would be disastrous for the Federation. The Federation would have no Federal Council, no Federal Executive Committee and the persons exercising the interim powers may cease to have those powers.

In all the circumstances the Court will defer the taking of such a drastic step.

Three months have now passed since the Court made the declaration to found the powers conferred by s.140(7). Under that sub-section a duty is imposed upon the Industrial Registrar and that sub-section and sub-section 8 is read:

"(7) Where -

(a) the Court makes a declaration under this section in relation to the rules of an organization; and

(b) at the expiration of three months from the date of the declaration, the rules of the organization have not been amended in a manner which, in the opinion of the Industrial Registrar, brings them "into conformity with the requirements of sub-section (1) as regards the matters that gave rise to the declaration,

the Industrial Registrar shall, after inviting the organization to consult with him on the matter, determine such alterations of the rules as will, in his opinion, bring them into conformity with those requirements as regards those matters.

(8) The Industrial Registrar shall register the alterations so determined by him and thereupon the rules shall be deemed to be altered accordingly."

Since the time referred to in s.140(7) has passed, the Industrial Registrar is unable to extend the time of three months referred to in that sub-section, see s.140(9).

The interim powers conferred by paragraph 7 of the Scheme cannot be permitted to be continued indefinitely. It is imperative that the Rules of the Federation be made to conform with the Act as soon as possible. This can be done by the Industrial Registrar exercising the powers conferred by s.140(7) of the Act. To enable this to be done the Court proposes to adjourn the further hearing of these matters to Friday, 8 August 1980 at Melbourne. This will enable the Industrial Registrar to exercise the powers conferred by s.140(7) and (8) of the Act. If new Rules have not been registered by 8 August 1980, the Court will hear submissions on what further action should be taken. It will be necessary for the Federal Secretary of the Federation to take all steps necessary to assist the Industrial Registrar in the exercise of the powers conferred upon him. In this regard, the persons upon whom the interim powers are conferred by paragraph 7 of the Scheme are the persons having the powers of the organization for the purposes of consultation under s.140(7) of the Act.

Accordingly, the further hearing of these matters is adjourned to 8 August 1980 at Melbourne at 10.15 a.m. All parties have liberty to apply on seven days' notice to the Court and the other parties to these proceedings.