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Sutton v Sharp (No 3)

Sutton v Sharp (No 3)

Case [2000] IRCA 1 12 May 2000

Administrative Action

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INDUSTRIAL RELATIONS COURT OF AUSTRALIA
Sutton v Sharp (No 3) [2000] IRCA 1
SUPPLEMENTARY
REASONS FOR JUDGMENT
and
SCHEDULE
SPENDER, RYAN and NORTH JJ
MELBOURNE
12 MAY 2000

IN THE INDUSTRIAL RELATIONS COURT OF AUSTRALIA

VICTORIA DISTRICT REGISTRY

VI 4819 OF 1995

BETWEEN:

JOHN DAVID SUTTON
First Applicant

CONSTRUCTION, FORESTRY, MINING & ENERGY UNION
Second Applicant

AND:

IAN GORDON SHARP
First Respondent

THE STATE OF VICTORIA and STEPHEN GEORGE ALLEY
Second Respondents / Appellants

JOHN ATKINSON & ORS
Third Respondents

JOSEPH FERGUSON & ORS
Fourth Respondents

MICK YOUNG & ORS
Fifth Respondents

RONALD GEORGE OWENS (as representing the members of the BLF at 31 March 1994 other than those otherwise represented herein)
Sixth Respondent

and

JOHN CUMMINS, JOHN SETKA and ROBERT GREGORY WILSON (as Trustees of the BLF)
Seventh Respondents

VI 4820 OF 1995

BETWEEN:

JOHN DAVID SUTTON
First Applicant

CONSTRUCTION, FORESTRY, MINING & ENERGY UNION
Second Applicant

AND:

IAN GORDON SHARP and STEPHEN GEORGE ALLEY
First Respondents / Appellants

THE STATE OF VICTORIA
Second Respondent

JOHN ATKINSON & ORS
Third Respondents

JOSEPH FERGUSON & ORS
Fourth Respondents

and

MICK YOUNG & ORS.
Fifth Respondents

RONALD GEORGE OWENS (as representing the members of the BLF at 31 March 1994 other than those otherwise represented herein)
Sixth Respondent

and

JOHN CUMMINS, JOHN SETKA and ROBERT GREGORY WILSON (as Trustees of the BLF)
Seventh Respondents

VI 4821 OF 1995

BETWEEN:

JOHN ATKINSON & OTHERS
Appellants

AND:

JOHN DAVID SUTTON & OTHERS
Respondents

VI 4822 OF 1995

BETWEEN:

JOHN DAVID SUTTON
First Applicant

and

CONSTRUCTION, FORESTRY, MINING & ENERGY UNION
Second Applicant

AND:

IAN GORDON SHARP and STEPHEN GEORGE ALLEY
First Respondents / Appellants

THE STATE OF VICTORIA
Second Respondent / Appellant

JOHN ATKINSON & ORS
Third Respondents

JOSEPH FERGUSON & ORS
Fourth Respondent / Appellants

MICK YOUNG & ORS
Fifth Respondents

RONALD GEORGE OWENS (as representing the members of the BLF at 31 March 1994 other than those otherwise represented herein)
Sixth Respondent

and

JOHN CUMMINS, JOHN SETKA and ROBERT GREGORY WILSON (as Trustees of the BLF)
Seventh Respondents

JUDGES:

SPENDER, RYAN AND NORTH JJ

DATE OF ORDER:

12 MAY 2000

WHERE MADE:

MELBOURNE

MINUTES OF ORDER
THE COURT ORDERS THAT the Orders made on 10 March 2000 insofar as they purport to have been made in proceedings numbered VI4821 and VI4822 be set aside.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE INDUSTRIAL RELATIONS COURT OF AUSTRALIA

VICTORIA DISTRICT REGISTRY

VI 4819 OF 1995

BETWEEN:

JOHN DAVID SUTTON
First Applicant

CONSTRUCTION, FORESTRY, MINING & ENERGY UNION
Second Applicant

AND:

IAN GORDON SHARP
First Respondent

THE STATE OF VICTORIA and STEPHEN GEORGE ALLEY
Second Respondents / Appellants

JOHN ATKINSON & ORS
Third Respondents

JOSEPH FERGUSON & ORS
Fourth Respondents

MICK YOUNG & ORS
Fifth Respondents

RONALD GEORGE OWENS (as representing the members of the BLF at 31 March 1994 other than those otherwise represented herein)
Sixth Respondent

and

JOHN CUMMINS, JOHN SETKA and ROBERT GREGORY WILSON (as Trustees of the BLF)

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Sutton v Sharp (No 3)

Details

AGLC: Sutton v Sharp (No 3) [2000] IRCA 1
Case: [2000] IRCA 1
Decision Date: 12 May 2000

CaseChat Overview and Summary

In the case of Sutton v Sharp (No 3), the dispute revolves around the legality of the Custodian's exercise of power in relation to the property and funds of the Australian Building Construction Employees’ and Builders Labourers’ Federation (BLF). The case was heard by a Full Court, which had to address several critical legal issues stemming from earlier proceedings in this Court and the High Court. These issues primarily concerned the validity of the Custodian's actions under the Conciliation and Arbitration Act 1904 (Cth) and subsequent legislative changes, including the Builders Labourers’ Federation (Cancellation of Registration) Act 1986, the Builders Labourers’ Federation (Cancellation of Registration – Consequential Provisions) Act 1986, and the BLF (De-recognition) Act 1985 (Vic). The Full Court was tasked with determining whether the Custodian's exercise of power was based on a mistake of law or a miscarriage of discretion, a question that had significant implications for the respondents, Mr Sutton and the CFMEU.

The Full Court meticulously analyzed the legislative framework and the High Court's previous judgments to resolve the legal issues. It found that the Custodian's actions were not based on a mistake of law or a miscarriage of discretion, as mandated by the joint judgment of the High Court. This conclusion was critical in understanding the extent to which the respondents could challenge the Custodian's decisions. The Full Court also addressed the respondents' attempt to introduce new issues, finding that such attempts were not permissible under the circumstances. By examining the legislative provisions and their application, the Court concluded that the Custodian's exercise of power was valid and that the respondents' contentions were without merit.

As a result, the Full Court allowed the appeals in part and set aside specific paragraphs of the declarations and orders made by Wilcox CJ. This outcome reinforced the legal position that the Custodian's actions were lawful and that the respondents' challenges were unfounded. The Court reserved the liberty to make further orders if any party wished to contend that additional orders were necessary to fully dispose of the appeals. This decision underscores the importance of adhering to legislative frameworks and the limitations on challenging administrative actions based on perceived mistakes of law or discretion.

Orders

Orders of the court

Full text does not contain this section.

Background

Background to the litigation

Before proceeding to examine the issues raised by the amended notice of contention, we should rehearse part of the factual background to the earlier proceedings in this Court and the High Court.A. LEGISLATIVE AND FACTUAL BACKGROUND The Australian Building Construction Employees’ and Builders Labourers’ Federation (“the BLF”) had for many years been an organisation of employees registered under the Conciliation and Arbitration Act 1904 (Cth). By force of that legislation the BLF enjoyed the legal personality of a body corporate. Another Commonwealth Act, the Builders Labourers’ Federation (Cancellation of Registration) Act 1986 (“the Cancellation Act”) which came into operation on 14 April 1986 cancelled the registration of the BLF under the Conciliation and Arbitration Act. In conjunction with the Cancellation Act, the Builders Labourers’ Federation (Cancellation of Registration – Consequential Provisions) Act 1986 (“the Consequential Provisions Act”) provided that in consequence of the Cancellation Act the property of the BLF was to belong to an incorporated association and to be administered in accordance with its constitution and rules. That had the effect, as explained by Gaudron, Gummow and Hayne JJ in State of Victoria v Sutton (1998) 156 ALR 579 at 581, of preserving, in relation to the BLF, the operation of s 143(6) of the Conciliation and Arbitration Act. Legislation of the State of Victoria, the BLF (De-recognition) Act 1985 (Vic) (“the De-recognition Act”) was also directed to the BLF. The De-recognition Act received the Royal Assent on 30 July 1985 and s 7 which commenced on 1 August 1986 provided:(1) For the purpose of protecting the rights of persons who have ceased to be members of BLF, the Governor in Council may by Order published in the Government Gazette provide for the restriction of the use of funds or property of BLF and for the control of those funds or that property.(2) An Order made under sub-section (1)-(a)shall come into force upon the date of publication of the Order in the Government Gazette; and(b)shall, unless sooner revoked, cease to be in force at the expiration of 6 months from the date on which it came into force but may, at any time while it remains in force (including a time when it remains in force by virtue of a previous extension or previous extensions under this paragraph), be extended in duration by a further Order made by the Governor in Council and published in the Government Gazette.3. A person shall not contravene an Order made under sub-section (1).” Section 11 of the De-recognition Act provided:“This Act shall cease to have effect at the expiration of one year after the day on which it receives the Royal Assent unless-(a)all of the provisions of this Act have by then been proclaimed to come into operation; or(b)this Act is sooner repealed.” However, ss 2(2) and 6 of the BLF (De-recognition) Amendment Act 1987 (Vic) (“the 1987 Act”) operated to repeal s 11 of the De-recognition Act. Accordingly, as noted in the joint judgment in State of Victoria v Sutton, at 584 “the operation of the De-recognition Act was continued beyond 30 July 1986”. The 1987 Act also amended s 7(1) of the De-recognition Act with effect from 13 October 1987. As so amended, s 7(1) of the De-recognition Act provided:“For the purpose of protecting the rights of persons who are or have ceased to be members of BLF, the Governor in Council may by Order published in the Government Gazette provide for the restriction or distribution of the use of funds or property of BLF and for the control, vesting and realisation of those funds or that property.”

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

That analysis, which we consider to be mandated by the joint judgment of the High Court, entails that it is not permissible in the circumstances to attack the Custodian's exercise of power as based on a mistake of law or a miscarriage of discretion.CONCLUSION It will be apparent from the foregoing reasons that we have resolved, adversely to Mr Sutton and the CFMEU, who were the respondents in the High Court, each of the issues raised by their notice of contention in that Court and the additional issue sought before this Full Court to be added to that notice. That resolution, it seems to us, requires that the appeals from the judgment of Wilcox CJ be allowed in part and that paragraphs 3 and 4 of the declarations and orders made by his Honour on 24 August 1995 be set aside. In case any party wishes to contend that some further or other orders are necessary to dispose fully and effectively of the appeals, we shall reserve liberty to apply.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

Actions

Citations

Sutton v Sharp (No 3) [2000] IRCA 1

Most Recent Citation

Ling v Commonwealth [1996] FCA 669

Cases Citing This Decision

Gibbs v Kinna [1998] VSCA 52
Citation 1 (Para 1)

…I accept that, save for the claims made under the Trade Practices Act, all the claims made in the Magistrates' Court could have been brought in the Industrial Relations Court in February 1997. The authorities indicate that, by virtue of s.430 of the IRA, which is relevantly indistinguishable from s.…
State of Victoria v Sutton [1998] HCA 56
Citation 2 (Para 4)

…declaration that the IRC had no jurisdiction to hear and determine the proceeding and for its dismissal was refused by Wilcox CJ on 12 October 1994: Sutton v Sharp (1994) 1 IRCR 259; 125 ALR 643; 57 IR 102.…
Sharp v Sutton and Construction, Forestry, Mining and Energy Union [1996] IRCA 388
Citation 3

…Sutton v Sharp (1994) 1 IRCR 259…
Ling v Commonwealth [1996] FCA 669
Citation 4

…Henderson v. Henderson (1843) 3 Hare 110 Port of Melbourne Authority v. Anshun Pty Ltd (1981) 147 CLR 589 Bryant v. Commonwealth Bank of Australia (1995) 57 FCR 287 Phillip Morris Inc v. Adam P Brown Male Fashions Pty Ltd (1981) 148 CLR 457 Sutton v. Sharp (1994) 125 ALR 643 Edward Ward & Co v. McDo…

See all citing cases →

Cases Cited

CFMEU v AIRC [1998] FCA 1404
Citation 1 (Para 22)

…discretion to void. The result is a constructive failure to exercise the power with the consequence that the avoidance is a nullity. CFMEU v AIRC (1999) 159 ALR 1, 43 Craig v South Australia (1995) 184 CLR 163, 179 Further and in the alternative, the purported exercise of the power by the custodian was based on a f…
State of Victoria v Sutton [1998] HCA 56
Citation 2 (Para 6)

…ith its constitution and rules. That had the effect, as explained by Gaudron, Gummow and Hayne JJ in State of Victoria v Sutton (1998) 156 ALR 579 at 581, of preserving, in relation to the BLF, the operation of s 143(6) of the Conciliation and Arbitration Act.…
Craig v South Australia [1995] HCA 58
Citation 3 (Para 22)

…ive failure to exercise the power with the consequence that the avoidance is a nullity. CFMEU v AIRC (1999) 159 ALR 1, 43 Craig v South Australia (1995) 184 CLR 163, 179 Further and in the alternative, the purported exercise of the power by the custodian was based on a further error of law, namely that the dispositio…
Cunliffe v The Commonwealth [1994] HCA 44
Citation 4 (Para 1)

…In Cunliffe v Commonwealth of Australia (1994) 182 CLR 272, Mason CJ said at 307: “Communication across State borders constitutes ‘intercourse among the States’ within the meaning of s. 92 of the Constitution. Cole v Whitfield left open the question: what burden, if any, can be imposed on freedom of interstate interc…
Registrar of the Accident Compensation Tribunal v Commissioner of Taxation (Cth) [1993] HCA 69
Citation 5 (Para 16)

…t the Custodian was to hold the property as trustee and not beneficially. In Registrar of the Accident Compensation Tribunal v FCT ((1993) 178 CLR 145; 117 ALR 27), this court found that a trust arose out of legislation which similarly did not expressly provide for a trust and allowed a wide discretion to the trustee…
Immer (No 145) Pty Ltd v Uniting Church in Australia Property Trust (NSW) [1993] HCA 27
Citation 6 (Para 14)

…rminate or keep a contract on foot ( Immer (No 145) Pty Ltd v Uniting Church in Australia Property Trust(NSW) (1993) 182 CLR 26 at 41-2; 112 ALR 609). In its setting in cl 2 of the Order, ‘option’ is best understood as identifying a power, but not a duty, which is thereby conferred upon the Custodian. 41 Clause 2 of…
Nationwide News Pty Ltd v Wills [1992] HCA 46
Citation 7 (Para 7)

…course, the concepts of “intercourse” and “trade and commerce” are not mutually exclusive. Brennan J noted in Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 54-5: “Although the conception of intercourse is distinct from the conception of ‘trade’ or of ‘commerce’, instances of intercourse may be, and frequently…
Australian Capital Television Pty Ltd v The Commonwealth [1992] HCA 45
Citation 8 (Para 8)

…Dawson J observed in Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106, at 192: “…the answer was given in Cole v Whitfield that, in relation to interstate trade and commerce, ‘absolutely free’ means free from discriminatory burdens of a protectionist kind. That answer does not greatly assist…
Cole v Whitfield [1988] HCA 18
Citation 9 (Para 36)

…In Cole v Whitfield (1988) 165 CLR 360, the High Court said at 391: “The purpose of the section is clear enough: to create a free trade area throughout the Commonwealth and to deny to Commonwealth and States alike a power to prevent or obstruct the free movement of people, goods and communications across State bounda…
Bailey v Krantz [1985] FCA 370
Citation 10 (Para 21)

…Reliance is placed on the observation of Gray J in Bailey v Krantz (1985) 13 IR 339 at 377: “The rules of a federally registered organisation derive their force and effect from the federal Act. See s 141 of the federal Act [ the Conciliation and Arbitration Act 1904] and R v Commonwealth Court of Conciliation and Arbitra…
T A Robinson & Sons Pty Ltd v Haylor [1957] HCA 76
Citation 11 (Para 29)

…See also Charles Marshall Pty Ltd v Collins (1957) 96 CLR 1 at 3; T.A. Robinson & Sons Pty Ltd v Haylor (1957) 97 CLR 177 at 182-3; and Metal Trades Industry Association v Amalgamated Metal Workers and Shipwrights’ Union (1983) 152 CLR 632 at 641-2, 648-9. There is no provision of the IR Act which has a similar appl…
Charles Marshall Pty Ltd v Collins [1957] HCA 13
Citation 12 (Para 29)

…See also Charles Marshall Pty Ltd v Collins (1957) 96 CLR 1 at 3; T.A. Robinson & Sons Pty Ltd v Haylor (1957) 97 CLR 177 at 182-3; and Metal Trades Industry Association v Amalgamated Metal Workers and Shipwrights’ Union (1983) 152 CLR 632 at 641-2, 648-9. There is no provision of the IR Act which has a similar ap…
Collins v Charles Marshall Pty Ltd [1955] HCA 44
Citation 13 (Para 28)

…rsuant to the IR Act were, by the terms of the Act, brought into force as part of the law of the Commonwealth: see Collins v Charles Marshall Pty Ltd (1955) 92 CLR 529, where Dixon CJ, McTiernan, Williams ,Webb, Fullager and Kitto JJ said at 547: “The basis of the application of s 109 to a State law affecting indust…
R v Commonwealth Court of Conciliation and Arbitration; Ex parte Barrett [1945] HCA 50
Citation 14 (Para 21)

…s 141 of the federal Act [ the Conciliation and Arbitration Act 1904] and R v Commonwealth Court of Conciliation and Arbitration; Ex parte Barrett (1945) 70 CLR 141, at 151 per Latham CJ. If there is present in those rules any express limitation on the right of the organisation to register one of its branches under…
Cohen v Cohen [1929] HCA 15
Citation 15 (Para 16)

…roperty of another, something which he is to hold, apply or account for specifically for his benefit’ ( Cohen v Cohen (1929) 42 CLR 91 at 100 per Dixon J) is a trustee in the ordinary sense.’ To the extent that it is relevant, the Custodian also recognised that he held the funds as trustee and not beneficially, for…
Federated Saw Mill &c Employes of Australasia v James Moore & Son Pty Ltd [1909] HCA 43
Citation 16 (Para 28)

…s are by the terms of the Act itself brought into force as part of the law of the Commonwealth…’ per Isaacs CJ and Starke J, Ex parte McLean [(1909) 8 CLR 465]”. (emphasis added)…
Metal Trades Industry Association v Amalgated Metal Workers' & Shipwrights' Union [1983] HCA 28
Citation 17 (Para 29)

…binson & Sons Pty Ltd v Haylor (1957) 97 CLR 177 at 182-3; and Metal Trades Industry Association v Amalgamated Metal Workers and Shipwrights’ Union (1983) 152 CLR 632 at 641-2, 648-9. There is no provision of the IR Act which has a similar application in relation to certified rules of an organisation.…
Registrar of the Accident Compensation Tribunal v Federal Commissioner of Taxation [1993] HCA 1
Citation 18 (Para 16)

…to hold the property as trustee and not beneficially. In Registrar of the Accident Compensation Tribunal v FCT ((1993) 178 CLR 145; 117 ALR 27), this court found that a trust arose out of legislation which similarly did not expressly provide for a trust and allowed a wide discretion to the trustee. The court…
[1920] AC 636 [1920] AC 636
Citation 19 (Para 16)

…o indicate otherwise, a person who has ‘the custody and administration of property on behalf of others’ ( Taylor v Davies [1920] AC 636 at 651) or who ‘has received, as and for the beneficial property of another, something which he is to hold, apply or account for specifically for his benefit’ ( Cohen v Cohen (1…
[1975] 1 WLR 279 [1975] 1 WLR 279
Citation 20 (Para 16)

…t 39 per Mason CJ, Deane, Toohey and Gaudron JJ): ‘A trust may be created without use of the word ‘trust’ (See Re Kayford Ltd [1975] 1 WLR 279 at 282; [1975] 1 All ER 604 at 607 per Megarry J; Tito v Waddell (No 2) [1977] Ch 106 at 211 per Megarry V-C. See also Brisbane City Council v Attorney-General (Qld) [1979]…
[1979] AC 411 [1979] AC 411
Citation 21 (Para 16)

…egarry J; Tito v Waddell (No 2) [1977] Ch 106 at 211 per Megarry V-C. See also Brisbane City Council v Attorney-General (Qld) [1979] AC 411 at 421) And, unless there is something in the circumstances of the case to indicate otherwise, a person who has ‘the custody and administration of property on behalf of othe…

Legislation Cited

BLF (De-recognition) Act 1985 (Vic) 11
2 mentions (from Para 2)
Constitution of Australia (Cth) 109, 92
2 mentions
Industrial Relations Act 1988 (Cth) 205
2 mentions (from Para 2)
Interpretation of Legislation Act 1984 (Vic) 10A
2 mentions (from Para 6)
BLF (De-recognition) (Amendment) Act 1987 (Vic)
1 mention (from Para 16)
Builders Labourers' Federation (Cancellation of Registration) Act 1986 (Cth)
1 mention (from Para 6)
Conciliation and Arbitration Act 1904 (Cth)
1 mention (from Para 6)
Police Regulation Act 1958 (Vic)
1 mention (from Para 5)
Workplace Relations Act 1996 (Cth)
1 mention (from Para 26)

BETWEEN:	JOHN ATKINSON & OTHERS Appellants
AND:	JOHN DAVID SUTTON & OTHERS Respondents

JUDGES:	SPENDER, RYAN AND NORTH JJ
DATE OF ORDER:	12 MAY 2000
WHERE MADE:	MELBOURNE