The Application of Hardie, C.S.

[1989] FCA 407

JUDGMENT No. - .!.O3.&

C A T C H W O R D S

INDUSTRIAL LAW - electoral offences - application for leave to hold office in union - explanations given by applicant - credibility - protection of public - importance of honest elections.

Industrial Relations Act 1988, ss.227, 229, 230, 231

Industrial Relations (Consequential Provisions) Act 1988, ss.4(1),

5(1), 56

Conciliation and Arbitration Act 1904, s.l71(l)(h)

Companies Act 1961, 6.122

The Application of Colin Stanley Hardie

Q12 of 1989

PINCUS J .

BRISBANE

Z8 JULY 1989

IN THE FEDERAL COURT OF AUSTRALIA	1
QUEENSLAND DISTRICT REGISTRY	1
INDUSTRIAL DIVISION	)

The Application of Colin Stanley HARDIE

MINUTES OF ORDER

JUDGE MAKING ORDER:  PINCUS J .

DATE OF ORDER:	28 JULY 1989
WHERE MADE:	BRISBANE
THE COURT ORDERS THAT:

1.    the application be dismissed.

NOTE :  Settlement and entry of orders is dealt with in
Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA	)
QUEENSLAND DISTRICT REGISTRY	)
INDUSTRIAL DIVISION	)

The Application of Colin Stanley HARDIE

PINCUS J . 28 JULY 1989

REASONS FOR JUDGMENT

This is an application instituted under 66.229 and 230 of the Industrial Relations Act 1988 for leave to hold office in organisations; the Act came into force on 1 March 1989.

On 15 March 1989, the applicant was convicted by the Full Court of this Court of five offences under s.l71(l)(h) of the Conciliation and Arbitration Act 1904; in each case, the charge was that in connection with an election for office in an	organisation of employees, he obtained a ballot paper without	lawful authority or excuse.
The matter came before the Full Court on an appeal by the prosecutor who complained, successfully, that the Court below had wrongly discharged the defendant (now applicant) without proceeding to conviction, upon his entering into a recognizance.
The offence mentioned is a "prescribed offence" within the definition in 6.227 of the Industrial Relations Act 1988, read with 6.56 of the Industrial Relations (Consequential Provisions) Act 1988 and in consequence the applicant is "not eligible to be a candidate for an election, or to be elected or appointed, to an
office in an organisation unless ..." one of two conditions is
fulfilled. These are, firstly, that a successful application is made under s.229 or 6.230 in relation to the conviction, and, secondly, that five years have elapsed since the conviction, or, if there was a term of imprisonment, since release from prison.
Each of 66.229 and 230 empowers the Court to give the applicant leave to hold office in organisations, the term "organisation" being defined in s.4(1) of the Industrial Relations Act 1988 to mean an organisation registered under the Act. The relevant organisation was in fact registered under the previous Act, that of 1904, but by virtue of s.5(1) of the Industrial Relations (Consequential Provisions) Act 1988 it is now taken to have become registered under the Industrial Relations Act 1988.
If the application for leave to hold office fails, then office in the organisation. The offices he presently holds are the result is that the applicant, under s.229(3), ceases to hold
those of Queensland Branch Assistant Secretary and Queensland Branch representative on the Federal Council of the organisation, the Federated Liquor and Allied Industries Employees Union of Australia (the "Union"). He also has the title of Industrial Officer and there was some discussion at the hearing as to whether the latter is an "office" within the definition in s.4(1) of the
Industrial Relations Act 1988; I do not find it necessary to resolve that point, nor desirable to do so. There is no certainty that, after delivery of this judgment, the applicant will continue to be employed by the Union and further the functions of the holder of the position of Industrial Officer were not sufficiently explained in the evidence to enable me to determine whether the definition of "office" applies.
When convicted, the applicant held the two positions I have mentioned. He has been with the Union since early 1982 when he became the Branch Industrial Officer and it appears that he is making a career as a Union official. The application is therefore of particular importance to him. It is opposed by a number of persons to whom leave to intervene was given.
Under s.231, for the purposes of exercising its power under 66.229 or 230, the Court is to have regard to:

"(a)	the nature of the prescribed offence;
(b)	the circumstances of, and the nature of the person's involvement in, the commission of the
prescribed offence;
(C)	the general character of the person;
(d)	the fitness of the person to be involved in the management of organisations, having regard to the conviction for the prescribed offence; and
(e)	any other matter that, in the Court's opinion,
is relevant. "

There was a great deal of evidence given as to topic (c)

- general character - including evidence from people who have

risen to prominent positions in industrial affairs and in the Australian Labor Party. That evidence satisfies me that the applicant has a good general reputation in those circles, although it has to be said that some of the persons called did not seem to have a very detailed knowledge of the applicant; an example is Mr C. Sciacca, a member of the House of Representatives. The more contentious question is the applicant's motive in committing the offences which have given rise to the problem; that is relevant under s.231(b), quoted above. To put the matter briefly, the applicant's case was that he obtained the five ballot papers the subject of the offences, and many others, without lawful authority or excuse, but with a morally innocent motive or intention, namely to preserve the election to which the ballot papers related from fraudulent voting organised by employers. I have come to the conclusion that the applicant did not have possession of the ballot papers for that reason, but to enable them to be used for fraudulent voting in favour of himself and one Elton, the State Secretary. I reject the applicant's account of the circumstances of and the nature of his involvement in the commission of the offences. In my opinion, he succumbed to the temptation to take

a fraudulent purpose. I do not think he did so for any	part in and arrange for the collection of unused ballot papers for
particularly noble motive; what he had in mind was principally preserving the holding of his own offices in the Union and that of his friend Elton. There are aggravating circumstances; these are principally that the applicant had previously been elected to office with the assistance of votes he knew to be fraudulent and that the offences were committed in defiance of clear warnings given by officials of the Australian Electoral Commission responsible for the conduct of the ballot. I have also taken into account the fact that the applicant has, in my opinion, sworn before me to a false account of the circumstances of the commission of the offence, a matter which goes against his character.
Insofar as the evidence dealt with the applicant's part in the taking of ballot papers other than the five the subject of the convictions mentioned above, it is relevant, strictly speaking, under s.231te) rather than (b).
According to the applicant's evidence, when he joined the Union, there was what he called a "system" in place, under which elections were commonly rigged. There was an election in June 1982, in which he acquired knowledge of and actually observed evidence of electoral fraud carried out in a conspiracy between Union officials and employers. The evidence was that managers of hotels supplied excess ballot papers which were fraudulently filled in and the applicant says he formed the view that there were "relatively few genuine votes cast". Apart from the sort of fraud just mentioned, there was, according to the applicant,
was paid for his work on the basis that the ballot papers would be extensive collection of blank ballot papers by an organiser who fraudulently used.
At the end of 1983, the applicant stood for the position of Branch representative to the Union's Federal Council (which he still holds). He accepted nomination for the position knowing that he was to be the beneficiary of numerous fraudulent votes.
His evidence was that he had no doubt that the "'system1 which operated in 1982 operated again in this particular election and that on this occasion it favoured me".
There is also evidence, which I accept, that Union officials were involved in fraudulent electoral practices in the following year, 1985. The applicant asked one Sandra Baldwin, before the election, to go to hotel establishments on the Gold Coast and collect unclaimed ballot papers. The applicant also told Sandra Baldwin to fill the ballot papers out in favour of the "ticket" which included the applicant and Baldwin and she did so. Her part in the matter is sworn to, not only by her, but by one Withers; I am satisfied that she did not act alone. Withers' account of this matter does not accord with that of Baldwin in important respects, but I have found it unnecessary to determine precisely to what extent Withers' account is true.
On 4 June 1985, Mr K.J. Fitzgerald, who was participating in the conduct of the election as an official of the Australian Electoral Commission, wrote to the applicant a letter which was prompted by a notice about the election posted by the
taken "special action to provide for the control of security of applicant. The letter of 4 June asserted that Fitzgerald had
ballot material at this election" and said, "You have no power to intervene". On the following day, Fitzgerald wrote to all candidates, including the applicant, a letter saying, among other things, that the election was being conducted by the Commission and that:

"NO OTHER PERSON or ORGANISATION is authorised to
engage in the conduct of the election in any way".

The letter enclosed a copy of relevant parts of the legislation, including that under which the applicant was, in the end, convicted and a copy of regulation 140 made under the Conciliation and Arbitration Act 1904, which imposed a general restriction upon persons other than those authorised to "do or purport to do any act in the conduct of the election"

To come now to the 1986 election, there is no dispute that there was extensive fraudulent voting, despite the efforts of the Australian Electoral Commission, and in particular, those of Mr J.E. Curtis, who was appointed on 25 March 1986 to conduct it. The election was for the post of Secretary-Treasurer and Assistant Secretary, Elton and the appellant, the incumbents, both being candidates. After it became obvious that the election was abortive, in the sense that it was extensively affected by fraud, Curtis conducted an investigation. The interveners attempted to put his report in evidence. I rejected the report itself, but Curtis1 oral evidence given in the prosecution of the applicant in

evidence before me; the former was put in on behalf of the	the Magistrates Court and a schedule to his report were in
applicant, and the latter was tendered without objection.
Shortly after Curtis was appointed, he wrote a letter to Elton dated 27 March 1986 advising him of security measures
proposed to "detect any improper use of ballot material". On 21
May 1986 he wrote to all the candidates (including the applicant) enclosing a copy of a letter which was sent to employers regarding security arrangements. The latter said, among other things, "I wish to make it clear that no one has been authorised to collect or inspect any unclaimed ballot material at your establishment".
On 12 and 18 June 1986 Curtis received complaints that the applicant had (in one case) tried to collect ballot papers and (in another) taken ballot papers. The hotels in question were the Brook and The Resort, the latter being located at Surfers Paradise. The applicant admitted in his evidence that he took ballot papers from the Resort. On 24 June 1986, Curtis wrote to the applicant referring to complaints which had been received and directing all candidates and all officials of the Union to "take no part in the conduct of the election referred to herein".
There was some discussion at the hearing as to whether or not the applicant thought his conduct in collecting the ballot papers was lawful. He said he had doubts about it. I do not believe he was in any doubt.
The applicant gave evidence that he was concerned that the officials were not doing enough to ensure the security of the
ballot, and -

"... decided to take steps which I considered

necessary to prevent employers tampering with unclaimed ballot material. ' I decided to attend at hotels and other establishments during the ballot and make i t plain to management that they should give me all the unclaimed material so that it could be returned either to the union office or the Returning Officer."

The applicant went on to explain that a Union journal, a membership ticket, an industrial bulletin and how-to-vote material were posted at or about the same time as the ballot papers were sent out. He said that as a result, when he called at a place of employment of Union members, there would be unclaimed ballot papers as well as the additional material just referred to lying about. He said:

"My aim was to take all of this material back to the union office where I understood arrangements were made for the staff to separate out the ballot material and return it through the mail to the Electoral Office. Arrangements for this to be done were made by Brian Elton in his capacity as Acting Secretary. Now produced and shown to me and marked with the letter 'CUD' is a true copy of the Memorandum issued by Brian Elton on the 12th May, 1986 which directed this to be done."

It was part of the intervenersl case that the statement just quoted was false and that the document "CHD" was prepared after the election was over and predated. I find that to be so. The memo dated 12 May 1986, signed by Elton, was typed by Baldwin on some date which she cannot fix precisely, a difficulty she

shared with Elton, who gave evidence that it was issued on 12

August 1986. It included paragraphs as follows:

"1. The Branch will mail out to all members by the 1st June 1986 a union journal, membership ticket, union Industrial Bulletin Re Occupational Superannuation.

2.   It is imperitive [sic] that all officers give absolute high priority in their prespective [sic] zones to retrieving all excess union tickets issued, but not collected by the members at establishment level. These union tickets must not fall into the wrong hands.

3.    The area officers are t o ensure all establishments are visited in the month of June 1986.

4.    All officers are to ensure that the employers are made aware that any excess ballot material is returned to the Returning Officer. You are to assist in any way to ensure the ballot material is returned to the Returning Officer.

5.    All officers are to return all material collected to the Branch Head Office or the Gold Coast Office.

6.   The clerical staff have been instructed to vet all material and retrieve the union tickets. Any ballot material found will be returned to the Returning Officer."

There are several oddities about this document. One is the importance attached to collecting excess Union tickets as a matter of "absolute high priority". When asked what the importance was, the applicant said that persons who are not members might use the Union tickets to get into nightclubs free. One would have thought that on 12 May 1986, just before the hotly contested election, being re-elected would have had a higher priority. Another is the phrasing of paragraph 4. It appears to me intended to provide, retrospectively, some sort of excuse for collection of unused ballot papers; in particular, the expression

denied that he had any connection with the picking up of ballot	"assist in any way!' might cover what was done. Elton firmly
papers. Paragraph 5 is also strangely worded, as "all material collected" is capable to referring, inter alia, to ballot papers. But, as I have said, I am satisfied that document CHD is a fake and that the story which Elton and the applicant told me about it is untrue.
It must have been evident to the applicant and his legal advisers that an important part of his case was to establish that the "arrangements" referred to in the passage from the applicant's evidence quoted above were in fact made, in view of the past history of fraudulent electoral practice in the Union, and the "grave doubt" which, according to the applicant, he entertained as to the effectiveness of the Electoral Commissionls arrangements for the 1986 ballot. One might have expected some fairly precise evidence about the arrangements for return of unused ballot papers he collected and those collected by others. He gave evidence that, having collected ballot papers at a number of places, he returned them, together with other material collected, to the Union office, where it was placed -

"loosely in boxes etc. in the open area of the lower level of the union office at 129 Leichhardt Street Spring Hill".

The applicant's evidence was that he "understood" that arrangements had been made for the ballot papers to be returned, through the mail, to the Electoral Office from the Union office and that, noticing that the material collected in the open area

material was being dealt with in accordance with Elton's	became less in volume, he "assumed" that this was because the
directions in the memorandum marked CBD. Hardie said that he did not check to see that ballot papers taken to the Union office were returned to the Electoral Commission, nor instruct anyone to sort out election material and return the ballot papers to the Commission. He said he did not "normally", when he brought ballot papers in to the Union office, hand them to anyone, nor did he

!

recall saying anything to people in the office when the papers
were handed in.

Eltonls account was that he gave instructions for a repository for election material to be set up. He said that ballot papers were placed in it and that they "would have been" returned. He "assumed" that and thought covering letters might be in the files. However, a search of the files disclosed none. It emerged that the Electoral Commission's records disclose the

return of only two ballot papers, whereas Elton said that many - between 50 and 200 - must have been returned. I am asked to hold

that Elton sent all those ballot papers back, there being no record either in the Union files, nor in those of the Commission, of his having done so; I do not believe this part of Eltonvs story. There was no evidence, apart from that of Elton and Hardie, in support of the suggestion that instructions were given for a repository for election material to be set up, for the material to be sorted out and for any ballot papers found to be returned to the Electoral Commission. One would have expected such an unusual series of events to be well remembered by other officials and employees of the Union, if it occurred.

Another aspect of Elton's evidence which was I think

intended to give some credibility to the applicant's case was as
follows:

"There was a collating exercise to be done in relationship to the materials that were being returned by the mail in relationship to the Union material, and to try and identify how many returns we received and from what establishments, and who they were addressed to."

He went on to add that the exercise "would be in the records of the Union", but it was not produced, nor did any person who took part in such an exercise or was given instructions to do so come forward. The reason for this invention, for such (I have no doubt) it was, was to provide an additional explanation for the alleged accumulation in the Union's office of material relating to the election. The idea was that, instead of returning any ballot papers taken from hotels and the like immediately to the Electoral Commission, it was necessary to take them back to the Union office for sorting out - abstracting them from other material such as papers urging people to vote for Elton and the applicant. It must have been appreciated by Elton and Hardie that there was a degree of improbability about this, as it would have been simple enough to send the ballot papers back immediately, in the envelopes which were provided for them, and because picking up the "how to vote" material was on the face of it pointless; hence the concoction of the tale about the supposed arrangements for sorting out and collation in the Union office.

Another person who was a functionary of the Union at relevant times, H.G. Linacre, denied that the applicant told him that the applicant was collecting ballot papers. Linacre's principal importance in the case, however, was that he admittedly prepared lists of employers including coloured highlighting, which were given to Union officials, including Baldwin. Linacre said that the purpose of the highlighting (in different colours) was to draw attention "to those establishments where there were a high

proportion of work-place addresses". Different colours were used to indicate those establishments whose management was likely to be hostile to the incumbent team and those likely to be otherwise. He said:

"It was meant to indicate to officers who received the lists where they were going to have trouble checking to see whether Union material and election material had been distributed to members and to concentrate their efforts on those 'hostile'

establishments. "

He went on to say, in effect, that "hostility" had to do with whether the management was likely to be unwilling to distribute Union material or to allow collection of Union or campaign material and likely to misuse unclaimed ballot material.

This is not very convincing, as an explanation for the highlighting. People who were unlikely to distribute or to allow collection of Union material would, obviously enough, not necessarily be the same ones as those who would participate in electoral fraud. Eltonps version, on the same point, was that the colour coding designated "places where management would not care

Baldwin's account on this point, which is the one I accept, was	if the officials came and gathered up election material".
that the purpose was simple: to identify the places where it would be easy to get ballot papers. I should add that Linacre also said that Elton told him that on the basis of the returned Union material, the Union "intended regularising the membership records and also to prepare per establishment lists for providing to the Returning Officer". This has some resemblance to, but is
not the same as, Elton's version. If this had truly been intended, one would have expected to find in evidence either lists or written information derived by the Union from the returned material (there was none), or at least evidence from Union employees who took part in the preparation of or attempted to prepare such lists; again, there was no such evidence. I am convinced that the whole story about using returned material to assist in preparing more accurate Union records, or for any similar purpose, is a fabrication.
I have given some consideration to Elton's role. He gave evidence that he "knew both parties were engaging in a rort". If that is SO, it is all the more incomprehensible that he supposedly acquiesced in the collection of ballot papers in an open area at the Union office, where the potential for misuse must have been obvious. The possibility has occurred to me that there has been some understanding between Elton and the applicant that the latter will accept the blame for what occurred and minimise Elton's part in it. But even if that were so, it would not affect the outcome for the applicant, so that it is unnecessary to try to draw any inference about the extent to which there was such a
shifting of responsibility as I have just mentioned.
The conclusions stated to this point are sufficient to enable the matter to be disposed of, but it is desirable to mention some other questions which arose. It was alleged against the applicant (and Elton) that minutes of a meeting at which it was agreed that the Assistant Branch Secretary should receive a salary at a certain level were fraudulently altered, in 1986. I find that to be so, and I find that both Elton and the applicant participated. It is my opinion, however, that Elton was largely to blame and I base that view in part upon his own evidence.
Baldwin said that it was resolved, prior to the 1986 election, that the Assistant Secretary receive 95% of the Secretary's salary, but that on a Saturday morning Elton and the applicant met Baldwin by arrangement at the Gold Coast office of the Union and had the minutes altered; she deposed to the facts that this involved retyping several pages completely and that the effect was to make the former position an honorary one. The affidavit just mentioned was filed on 13 June 1989.
On 26 June the applicant filed a further affidavit, in which he said he had perused the relevant minutes (those of 22 August 1985) and that a resolution was passed approving certain pay scales; he claimed that there was "no pay rate attached to the office of Assistant Secretary". He denied the allegation of alteration of the minutes; he did not suggest that it had ever been resolved that the Assistant Secretary should have 95% of the Secretary's rate.
In her last affidavit, filed on 3 July 1989, Baldwin said that, as a member of the Committee of Management, she received minutes of meetings of that Committee and maintained her own personal file. She produced a copy of the original minutes of the meeting of 22 August 1985 and they indeed showed the Assistant Secretary as getting 95% of the Secretary's rate. I do not think the applicant, when he made his affidavit of 26 June, appreciated what ammunition Baldwin had.
When asked about the matter, Elton said that the minutes were typed up by a secretary. He went on:

"I make changes to suit what I believe was the true reflection of that particular meeting; I then, at the next Branch Committee of Management meeting, present those drafts, and if there are any changes they are raised then prior to the adoption ..."

This seems an odd explanation of the change sworn to by Baldwin; Elton admitted that in 1985 it was determined that the Assistant Secretary would be paid 95% of the Secretary's salary and that the minutes were later altered. He claimed the alteration was done at the direction of the Committee of Management, but I do not believe him and accept Baldwinvs account of the matter. I also accept that Hardie was implicated in this affair. It is not of itself of great importance, but demonstrates an attitude which should not be encouraged.

It should also be mentioned that there is a dispute about the extent to which Fitzgerald and Curtis were warned about

the possibility of employers interfering fraudulently in the

election. Elton said that he gave to the Commission some particulars of plans on the part of hoteliers to defeat him and Hardie and mentioned "clearing houses" for ballot papers, which he claimed would be used as part of the hoteliers1 scheme. Linacre, however, who was present at a meeting (on 29 April 1986) at which the subject was supposed to have been discussed, appeared not to

recall it. Fitzgerald said that Union officials expressed concern about the possibility of employers getting hold of ballot papers, but denied that "clearing houses" or potentially fraudulent hoteliers were identified.

This is a side issue, but I should say that I think it unlikely that Elton told Fitzgerald or Curtis the names of hoteliers who had been identified to him as parties to a conspiracy to participate in electoral fraud. Neither Fitzgerald nor Curtis believed he had done so, and I accept the submission that such an allegation would have been regarded by them as one worthy of note - and, indeed, one requiring further investigation. The place this allegation took in the applicant's case was that it was intended to provide a partial excuse for his conduct in collecting ballot papers and urging others to do so. That is, the argument was to be that since the Electoral Commission was incapable of taking proper precautions to ensure a fair election, it was necessary that the applicant collect unused ballot papers. I do not believe the assertion that prevention of employer fraud was the applicant's motive.

Next, some mention should be made of the connection between the places at which the applicant admitted having collected ballot papers and the postings of votes. The applicant said he collected ballot papers from The Resort at Surfers Paradise, the Captain's Table restaurant in the same area, the Caxton Hotel, the Castle Hotel, the Sunnybank Hotel, the "Kuraby", the Springwood Hotel and the Imperial or the Royal at Beenleigh. There is contained in exhibit 9 information as to the numbers of

business reply envelopes and the dates an places shown on the postmarks on such envelopes, in which ballot papers were posted. In the following table, only postings of a substantial number of envelopes are included.

Establishment Number Date Place

Springwood Tavern	29	15 June Stafford Mail Centre
Sunnybank Hotel	13	15 June Stafford Mail Centre
Kuraby Hotel	16	15 June Stafford Mail Centre

Caxton Hotel 4 15 June Stafford Mail Centre

Resort 58 18 June Gold Coast Mail Centre

Exhibit 9 discloses that there were multiple postings in respect of a number of other establishments; a large proportion of the votes seem to be in that category, but it may be said in favour of the applicant that for all one knows, some of these bulk postings were in favour of his opponents; an example is the Lone Star Tavern, in respect of which many votes were posted on 9 and 10 June in favour of the applicant's opponents. But the conclusion seems inescapable that there were bulk postings of ballot papers collected from some of the places at which the applicant admits having collected ballot papers. I am asked to believe that these occurred without the applicant's knowledge or consent and despite.his earnest endeavours to prevent rather than promote electoral fraud. As I have said, I do not believe that.

Conclusion

Only two possible reasons for the applicant's collection
of ballot papers have been put forward and require consideration.

I am satisfied that, with the intention that they be used

fraudulently, the applicant collected ballot papers or caused them to be collected or both. It is clear, however, that not every offence or series of offences is such as to necessitate the consequence of imposition of the five year ban; that is explicit in the statute's terms. In Re Ferris (1983) 4 I.R. 342 at 347, Morling J., on an application of this sort, applied decisions under 6.122 of the Companies Act (1961). That was a provision to similar effect that prima facie forbade persons convicted of certain offences to act as directors or take part in the management of companies. Section 122, and its later replacements, have been treated as not being punitive but as designed to protect the public, as well as investors in companies and the like. I am prepared to assume for present purposes that the approach taken in Re Ferris is the appropriate one. Nevertheless, it appears to me that only in an unusual case will a participant in a substantial electoral fraud, committed not in order to defeat villains, but merely to ensure success for his own side, succeed in an application of this sort. The circumstances of the particular case are not such as to make it appropriate to adopt the suggestion of Mr Boccabella, counsel for the applicant, to reduce

elections are of importance. The application must be dismissed the period of disqualification. I think clean and honest

and I shall hear the interveners on costs.

I certify that this and th. ninmteen pr-e-ding

pages a r e a t r u e copy o f the reasons for judgmmnt

hsrsin of His Honour nr Justic. Pincua.

Associate

~0t.d 2 p