The Australian Builders Labourers Federated Union of Workers Western Australian Branch v J-Corp P/L

[1993] FCA 360

THE AUSTRALIAN BUILDERS' LABOURERS' FEDERATED UNION OF WORKERS - WESTERN
AUSTRALIAN BRANCH v. J-CORP PTY LTD
No. WAG220 of 1992 FED No. 360
Number of pages - 16
Trade Practices
(1993) 114 ALR 551
(1993) 42 FCR 452

COURT

IN THE FEDERAL COURT OF AUSTRALIA

WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION
Lockhart(1), Spender(2) and Gummow(1) JJ

CATCHWORDS

Trade Practices - secondary boycott - picket-line - whether supply of goods or services "hindered or prevented" - whether conduct engaged in by appellant for the purpose of causing substantial loss or damage to the business of the respondent.

Trade Practices Act 1974, s. 45D

Devenish v Jewel Food Stores Pty Ltd (1991) 172 CLR 32.

Australian Broadcasting Commission v Parish (1980) 43 FLR 129.

HEARING

SYDNEY, 16, 17 March 1993

#DATE 3:6:1993

Counsel and solicitors Mr R.L. Le Miere instructed
for the Appellant: by Dwyer Durack.

Counsel and solicitors Mr M.C. Hotchkin instructed
for the Respondent: by Hotchkin Hanly.

ORDER

THE COURT ORDERS THAT:

1 The appeal be allowed.

2 The declaration, being order 1 of the orders made 9 December 1992, and order 1 of the orders made 19 February 1993, be set aside.

3 The respondent pay the costs of the appellant of the appeal and of the proceeding below up to and including 19 February 1993.

4 The proceeding be re-listed before a Judge of the Court, for directions as to the disposition of the balance of the proceeding, conformably with the Reasons for Judgment delivered today.
Note: Settlement and entry of orders is dealt with by Order 36 of the Federal Court Rules.

JUDGE1

Introduction

LOCKHART, GUMMOW JJ On 9 December 1992, the learned primary Judge (French J) made a declaration that the appellant:

". . . did on and from 27 July 1992 until 5 August 1992 engage in conduct in concert with its members and others which hindered and prevented the supply of goods and services by third parties to (J-Corp) at Rivervale in the State of Western Australia and that such conduct was engaged in for the purpose and was likely to have the effect of causing substantial loss or damage to the business of (J-Corp) and that the conduct of (the B.L.F.) was in contravention of Section 45D (1) (b) of the Trade Practices Act, 1974."

So far as is relevant, the provisions of sub-s. 45D (1) of the Trade Practices Act 1974 ("the Act") are as follows:

"45D (1) Subject to this section, a person shall not, in concert with a second person, engage in conduct that hinders or prevents the supply of goods or services by a third person to a fourth person (not being an employer of the first-mentioned person), . . . where -

(a) . . .

(b) the fourth person is a corporation and the conduct is engaged in for the purpose, and would have or be likely to have the effect, of causing -

(i) substantial loss or damage to the business of the fourth person . . . or

(ii) . . ."

1. The effect of the above declaration made by the primary Judge was that the appellant, (a) in concert with its members and others ("the second person"), (b) engaged in conduct which hindered and prevented the supply of goods and services by third persons to the respondent ("the fourth person") and that (c) such conduct was engaged in for the purpose and was likely to have the effect of causing substantial loss or damage to the business of the respondent. As will become apparent, on the hearing of the appeal there was some difficulty in disentangling the findings which were made, adversely to the appellant, on issues (b) and (c), namely hindering supply and "purpose".

2. Before us, counsel for J-Corp appeared to accept that it was on stronger ground in supporting the declaration as it applied to hindering than with "prevention" of supply. Attention was paid in address primarily to what was involved in "hindering" within the statutory sense.

3. On 19 February 1993, his Honour ordered that the B.L.F. pay half J-Corp's costs of the action. On 9 December 1992, directions had been given to prepare for hearing the question of further relief, including any claim for damages. It followed that the declaration and costs order to which we have referred were interlocutory in character, and that leave to appeal from them would be necessary; see Fisher and Paykel Healthcare Pty Ltd v Avion Engineering Pty Ltd (1991) 103 ALR 239 at 242.

4. Nevertheless, without first obtaining such leave, a notice of appeal was filed.

5. Upon the matter coming before us on 16 March 1993, the Court drew attention to the need for leave. After hearing submissions from counsel, the Court granted leave to appeal from the declaration and costs orders against the B.L.F., made 9 December 1992 and 19 February 1993 respectively. The Court ordered that the document appearing at pages 1043-1046 of the appeal papers stand in the appeal as the Amended Notice of Appeal.

6. The above recitation of events underlines the importance of observance by the legal profession of adherence to the rules as to the necessity for leave in interlocutory matters.

7. The orders in respect of which leave to appeal has been given were pronounced by the primary Judge after delivery of reasons for judgment which are reported, (1992) 111 ALR 502.

The Parties
9. J-Corp is a trading corporation which is registered as a builder under the provisions of the Builders' Registration Act 1939 (W.A.). In recent years, J-Corp has engaged in large scale residential construction work for the Western Australian State Government Housing Commission. This body is also known as "Homeswest". J-Corp has a policy of engaging independent contractors, rather than using employees, to provide the materials and services required for the performance of its construction work. This policy has led to conflict between J-Corp and unions involved in the building industry. One such union is the B.L.F. It and four other unions are members of the Building Trades Association of Workers ("the B.T.A."), which is registered under the provisions of the Industrial Relations Act 1979 (W.A.). The B.L.F. believed that Homeswest had given an undertaking as to the use of non-union labour.

1. The B.L.F. and the B.T.A. had in common as secretary, Mr Kevin Reynolds. Mr J.L. Fox and Mr G. Pallott were employed by the B.L.F. as temporary organisers. Mr M. Keogh had been employed by the B.L.F. as an industrial officer since April 1986. Mr Kim Young was employed by the B.L.F. as a safety co-ordinator.

2. French J held that effectively Mr Reynolds was the Chief Executive of the B.L.F. He had been secretary since 1974. There was a convention within the B.L.F. that no industrial action, especially action involving interruption of supplies, could be undertaken without his prior approval.

3. Whilst in some passages of his judgment dealing with the "purpose" of the B.L.F., his Honour referred to the mental processes and attitudes of both Mr Keogh and Mr Reynolds, we accept the submission for the B.L.F. that the relevant actor in such an important matter was Mr Reynolds.

The establishment of the picket line
13. On 13 July 1992, J-Corp commenced work on the construction of a housing development for Homeswest on a site at the corner of Minora Place and Great Eastern Highway at Rivervale ("the Rivervale site"). The agreed term for practical completion of the work by J-Corp was 36 weeks from possession of the Rivervale site.

1. On the morning of Friday 24 July 1992, Messrs Fox and Young together went to the Rivervale site. The site was bounded by a high wire fence. Entrance gates were locked. Messrs Fox and Young carried certificates as accredited union representatives pursuant to cl. 40 of the Building Trades (Construction) Award 1987 ("the Award"). Clause 40 authorised such accredited representatives to enter any place where employees were employed at any time during normal working hours or when overtime is being worked "for the purpose of interviewing employees, checking on wage rates, award breaches or safety conditions or regulations . . ." The right of entry conferred by cl. 40 was subject to a proviso that representatives present themselves with their authority to representatives of site management. It seems to have been the view of Messrs Fox and Young that under cl. 40 they had an unrestricted right of entry to the Riverdale site. The right of entry under cl. 40 does not require the prior permission of site management to enter, but accredited representatives are required to "present themselves with their authority to a representative of site management prior to pursuing their Union activities on site". The position of J-Corp's construction manager, Mr G. McEwan, was that J-Corp was a non-union employer, that the people on the site were sub-contractors, and that the visitors were there to stir up trouble. Mr McEwan asked Mr Fox to leave the site and he had the gate to the site locked with Mr Young on the outside.

2. The events of 24 July are fully described in his Honour's reasons (111 ALR at 504-7). His Honour decided that on that day there was no contravention by the B.L.F. of s. 45D of the Trade Practices Act 1974 ("the Act"). What the primary Judge described as a "de facto picket line" of about 10 men was established outside the entrance to the Rivervale site and manned by members of the B.L.F. and other unions. However this took place without "official union sanction".

3. Shortly before midday on 24 July, the police arrested 4 men at the Rivervale site, including Mr Fox and Mr Pallott. They were taken to the East Perth Lockup. Mr Reynolds, accompanied by Mr Keogh, arrived there earlier in the afternoon. Mr Reynolds was on leave and preparing to go overseas. Also present was Mr A. Drake-Brockman, a member of the firm of solicitors acting for the B.L.F. The 4 men who had been arrested were released at about 4 p.m.

4. On Friday afternoon, J-Corp arranged for flood lighting to be erected at the Rivervale site and for the employment of 24-hour security guards.

5. His Honour held that an "official picket line" was established from the following Monday, 27 July 1992, and that a number of suppliers to J-Corp declined to enter the Rivervale site whilst the picket was in place. Initially, the official picket line had been manned by members of the B.L.F. in greater numbers, but from 28 July the number was reduced to 5. The picket operated only on weekdays and only until 4 p.m.

The Issues
19. The B.L.F. relied upon various grounds, but as the argument on the appeal developed it became apparent that it had two principal complaints. First, it was submitted that there had been no conduct engaged in by the B.L.F. which hindered or prevented the supply of goods or services to J-Corp by other persons. Secondly, it was submitted that, in any event, the conduct was not engaged in for the purpose of causing substantial loss or damage to the business of J-Corp. (The B.L.F. also contended that the declaration was too widely framed in speaking of contraventions until 5 August; this was because there was, on any basis, no evidence against the B.L.F. of actual hindrance by it at the site after 29 July. It will be unnecessary to resolve that issue, but the point does appear to be of substance.)

1. As to the second point, it was submitted that there was no evidence, or no sufficient evidence, that Mr Reynolds, the relevant actor, had such a purpose. It was open to the primary Judge to deal with the issue of purpose by inferences drawn from the evidence as a whole. This was done, for example, in Barneys Blu-crete Pty Ltd v Australian Workers' Union (1979) 43 FLR 463 at 473. But the B.L.F. submits that the primary Judge, having accepted Mr Reynolds, reached a conclusion adverse to it on this issue by an implicit error of law as to the construction of s. 45D.

2. We will deal first with the question of picketing, and then with the issue of "purpose".
   Picketing

3. In part, the submissions for the B.L.F. appeared to proceed as if the term "picket" was included in the text of s. 45D, whereas, of course, like the term "secondary boycott", it is not. The issue is whether what was done was conduct engaged in by the B.L.F. which hindered or prevented the supply of goods or services by third persons to J-Corp.

4. Counsel for the B.L.F. rightly stressed that it had acted after the receipt of legal advice as to the impact of s. 45D upon the activities proposed for the Rivervale site. The B.L.F. appears to have acted on the footing that the installation and operation of a picket line would not amount to engaging in conduct which hindered the supply of goods or services in the necessary sense, if the picket line had particular characteristics. Thus, as was stressed on the appeal, it was J-Corp which had excluded the union representatives from the site and had kept it locked, comparatively small numbers of unionists manned the line, it was not maintained around the clock, and the B.L.F. intended that those wishing to enter would be persuaded by rational means not to do so; cf the facts found in Williams v Hursey (1959) 103 CLR 30 at 76-77. Reference was made in the evidence to the view within the B.L.F. that a picket line of this character would approximate to the type of activity which was accepted in the United States.

5. The intentions of those organising the picket line as to the methods of its operation may well be of significance in determining the issue under s. 45D as to purpose. But where, as here, what is being considered is the threshold question of the engagement in conduct of a certain description, being conduct which hindered or prevented the supply of goods or services, great weight must be given to the reasonable reactions of those representing the "third persons" who otherwise would have proceeded with the orderly supply of goods or services to J-Corp.

6. In that setting, the dictionary meaning of terms such as "picket" and "picket line", their use in other legislation and what has been said of them in litigation arising other than under s. 45D, cannot be of immediate assistance.

7. However, in view of the detailed submissions that were made, we should say something on the point.

8. The primary Judge (111 ALR 526) referred to dictionary definitions which defined a "picket" as persons who, during a strike, are stationed by a trade union before a place of work to watch persons going to work and to endeavour to dissuade or deter or prevent them from doing so. Here, as counsel for the B.L.F. emphasised, there was no strike at the Rivervale site; rather the industrial dispute was precipitated by the action taken under cl. 40 of the Award.

9. The Court was taken to passages in the judgments of the English Court of Appeal in Hubbard v Pitt (1976) QB 142. There, for example at 172-3, the term "picket" was used to describe an orderly and peaceful collection of persons outside particular premises in circumstances where there was no obstruction, molestation or intimidation of persons entering and leaving the premises, the object of the picket being the communication of information. The result was that there was no unreasonable obstruction amounting to public or private nuisance, or any other tort.

10. Earlier, in Sid Ross Agency Pty Ltd v Actors and Announcers Equity Association of Australia (1971) 1 NSWLR 760 (a case decided on a demurrer) Mason JA (at 767) said:
    

"At common law, picketing is not necessarily a nuisance and unlawful as such, but it becomes so if it involves obstruction and besetting: see J Lyons and Sons v Wilkins (1899) 1 Ch 255; Ward, Lock and Co. Ltd v Operative Printers' Assistants' Society (1906) 22 TLR 327. Here the pleading makes it abundantly clear that the form of picketing threatened involved obstruction of the thoroughfares and besetting of those who wished to enter the clubs, thereby constituting a nuisance and an interference with their rights."

1. The English decisions cited by Mason JA were also discussed in Hubbard v Pitt. "Besetting" includes the occupation of a roadway or passageway through which persons wish to travel, so as to cause those persons to hesitate through fear to proceed, or, if they do proceed, to do so only with fear for their own safety or the safety of their property: Dollar Sweets Pty Ltd v Federated Confectioners Association of Australia (1985) VR 383 at 388-9. See, generally, Davidson "A New Tort for Mass Picketing: The Thomas Case and Its Implications for Australia: (1988) 18 UWAL Rev 201.

2. In Broome v Director of Public Prosecutions (1974) AC 587, the House of Lords considered s. 134 of the Industrial Relations Act 1971 (U.K.). This, in terms, used the expression "pickets". Section 134 read:
   

"134 (1) The provisions of this section shall have effect where one or more persons (in this section referred to as 'pickets'), in contemplation or furtherance of an industrial dispute, attend at or near -

(a) a place where a person works or carries on business, or

(b) any other place where a person happens to be, not being a place where he resides, and do so only for the purpose of peacefully obtaining information from him or peacefully communicating information to him or peacefully persuading him to work or not to work.

(2) In the circumstances specified in the preceding subsection, the attendance of the pickets at that place for that purpose -

(a) shall not of itself constitute an offence under section 7 of the Conspiracy and Protection of Property Act 1875 (penalty for intimidation or annoyance by violence or otherwise) or under any other enactment or rule of law, and

(b) shall not of itself constitute a tort."

In that case, the defendant, a strike picket during an industrial dispute, stood holding a placard in front of a vehicle on a highway, urging the driver not to work at a site nearby and preventing him from proceeding along the highway as the driver wished. The House of Lords held that s. 134 made lawful the attendance of pickets only for the purposes specified therein. It did not require the person whom it was sought to persuade, to submit to any constraint or restriction on his right to personal freedom, so that although the defendant had a statutory right to invite the driver to stop and listen to him, so long as that was done in a reasonable way, the defendant had not been entitled to compel him to do so.

1. In Williams v Aristocratic Restaurants (1947) Ltd (1951) 3 DLR 769, the Supreme Court of Canada considered whether the picketing of a restaurant was unlawful, in the sense of being a civil wrong, where two men walked back and forth on the footpath in front of the restaurant each bearing a placard to the effect that the proprietor did not have a labour agreement with a named union. The Supreme Court held that there was no civil or criminal wrong involved. Among the legislation they considered was s. 501 of the Canadian Criminal Code. This provided for penalties against intimidation, but excepted from the wrongful conduct attendance "at or near or approaching the house or place in question in order merely to obtain or communicate information". At 789, Rand J said:
   

"(T)here is a difference between watching and besetting for the purpose of coercing either workmen or employer by presence, demeanour, argumentative and rancorous badgering or importunity, and unexpressed, sinister suggestiveness, felt rather than perceived in a vague or ill-defined fear or apprehension, on the one side; and attending to communicate information for the purpose of persuasion by the force of a rational appeal, on the other."

1. In the United States, there is a number of cases in which the Supreme Court has construed favourably to the States the limits imposed by the 14th Amendment on the power of State legislatures to authorise their courts to enjoin peaceful picketing, even when arising in the course of a labour controversy, where the picketing was counter to a "valid State policy in a domain open to State regulation". The authorities are discussed in International Brotherhood of Teamsters v Vogt Inc. 354 US 284 (1957). They are of no particular assistance in the present case, which is concerned with the terms used in s. 45D of the Act. To these we now turn. "Hindering" and s. 45D

1. The primary Judge (111 ALR at 535) referred to what was said by Deane J, in this Court, in Australian Broadcasting Commission v Parish (1980) 43 FLR 129 at 153, as to the concepts of "hindering" and "preventing" in sub-s. 45D (1). That passage included the following:
   

"The actual cessation of supply or acquisition of goods or services is commonly the object and can represent the culmination of conduct in breach of s. 45D of the Act. The conduct hindering or preventing supply or acquisition to which the section refers can be engaged in by threat and verbal intimidation as well as by physical interference with the actual activities."

1. Also of importance is what was said by Mason CJ in Devenish v Jewel Food Stores Pty Ltd (1991) 172 CLR 32 at 45-46:
   

"Further, it cannot be, and indeed was not, suggested in argument that the notion 'direct' is inherent in either of the words 'hinder' or 'prevent'. 'Hinder' has been construed in England 'in the general sense of in any way affecting to an appreciable extent the ease of the usual way of supplying the article' (emphasis added): Tennants (Lancashire) Ltd v C.S. Wilson and Co. Ltd (1917) AC 495 at 513-514 per Lord Dunedin; Peter Dixon and Sons Ltd v Henderson, Craig and Co. Ltd (1919) 2 KB 778 at

786. What was there said in relation to hindrance of supply would apply with equal force to hindrance of acquisition. The comments of Gibbs J relating to the words 'prevent or hinder' in R. v Bell; Ex parte Lees (1980) 146 CLR 141 at 147-148, must be seen in the context of that case. As his Honour observed, a broad construction would have effected a very drastic interference with ordinary civil rights. There is no similar reason for rejecting a broad interpretation of those words in this case. As has been said, such an interpretation is entirely consonant with the purpose of the section."

Whilst Mason CJ (together with Deane J) dissented with Devenish, this passage drew no direct disagreement from the majority. Further, Mason CJ (at 42-3), Deane J (51-2) and Toohey J (at 58) all eschewed any construction of sub-s. 45D (1) which sought to fit it within some pre-conceived notion of what constituted a paradigm case of a "secondary boycott". At best, that was a loose expression, not found in the legislation, and one lacking in any generally accepted definition or content. Earlier, in Actors and Announcers Equity Association of Australia v Fontana Films Pty Ltd (1982) 150 CLR 169 at 200-1, Mason J indicated that the true character of the provision was to be ascertained from an analysis of its legal operation according to its terms and without importation of any external notion or understanding of its subject matter.

1. That is of importance in the present case, given the emphasis to the term "picketing" and cognate expressions. The true issue on the first branch of the case is whether his Honour was correct in treating his findings as falling within the meaning of "hindering" in sub-s. 45D (1). In that issue, there is, of course, involved a consideration of what follows from the characterisation of the events at the Rivervale site as the establishment and maintenance of a picket line.

2. It will be apparent from the quotation of the judgment of Mason CJ in Devenish that his Honour confined his adoption of Tennants (Lancashire) to the speech of Lord Dunedin. This case and Peter Dixon supra were concerned with the operation, during World War I, of "suspensory clauses" in supply contracts. In the case before the House of Lords, the defendants had contracted to sell to the plaintiffs their requirements of magnesium chloride over the year 1914; the contract entitled them to suspend delivery in the event of war "preventing or hindering" the manufacture or delivery of the magnesium chloride. A greater part of the supplies came from Germany and it was held that the defendants were entitled to suspend delivery.

3. In Peter Dixon, the contract, made in 1911, provided for the delivery of wood pulp over a 6 year period with an entitlement in the seller to suspend delivery if this was prevented or hindered by events including the outbreak of war. The war brought about a complete dislocation of the pulp-carrying trade to Britain from Norway. It was held that although the sellers were not prevented, they were hindered in carrying out the contract, within the meaning of the provision in question. Bankes LJ (at 786) summarised what had been said in the earlier decision as follows:
   

"How far does the case of Tennants Ltd v Wilson and Co. lay down any rules of law which it is necessary to observe in coming to a conclusion on the question that is submitted to us? I think two rules were certainly laid down in that case. One was that a rise in price would not in itself constitute a hindrance to delivery within the meaning of such a contract as this; and I think the second rule may be gathered from the language of Lord Dunedin, where, in speaking of the judgment of Neville J, he says that the learned judge read the word 'hinder' 'in the general sense of in any way affecting to an appreciable extent the ease of the usual way of supplying the article . . .' I think also you find in the speeches, both of Lord Atkinson and Lord Loreburn, a definition of what constitutes a difficulty within the meaning of this contract. Lord Loreburn says this ((1917) AC at 510): 'By "hindering" delivery is meant interposing obstacles which it would be really difficult to overcome.' Lord Atkinson says (at 518): '"Preventing" delivery means, in my view, rendering delivery impossible; and "hindering" delivery means something less than this, namely, rendering delivery more or less difficult, but not impossible.'"

It will be apparent from this that Lord Loreburn and Lord Atkinson advocated a more stringent requirement than Lord Dunedin. Lord Wrenbury ((1917) AC at 526) took the view that delivery of supplies to one customer was hindered if the supplier could not satisfy all the contractual demands upon it, saying that a merchant has a short supply notwithstanding he is able to satisfy one customer when he is not able to satisfy all of them.

1. We have dealt with these English authorities at some length because the range of views in the judgments as to the meanings which might properly be given to the phrase "hinder or prevent" emphasises the significance of the choice by Mason CJ in Devenish, after reference to those authorities, of a broad construction of "hinder", for s. 45D, as in any way affecting to an appreciable extent the ease of the usual way of supply of goods or services. Of course, this broad construction on the first branch of sub-s. 45D (1), makes it all the more important closely to consider what is involved in "purpose".

The Findings of Fact as to Picketing
40. Against that background, one turns to the findings made by the primary Judge on this first branch of sub-s. 45D (1).

1. French J found (111 ALR at 515):
   

"What is clear is that from 27 July 1992 the BLF by its secretary Reynolds, had authorised the establishment of an assembly of its members outside the entrance to the Rivervale site which was designated and accepted by those involved as a picket line. It was intended by those concerned with its organisation including Keogh, Fox, Young and Pallott, that it would be seen and accepted as a picket line by suppliers for J-Corp approaching the site. When and precisely where signs announcing the existence of the picket were erected is, in my opinion, of little moment. That they were erected in the week commencing 27 July is beyond doubt. If a finding be necessary, it is probable, I think, that some form of sign announcing the existence of the picket was erected on 27 July which was the first day of its official union sanctioned existence."

1. There was evidence that the term "picket line" was used by Mr Fox to describe the situation at the entrance to the Rivervale site as established on and from 27 July, when he spoke with the drivers of vehicles who had approached the entry to the site, for the delivery of supplies. There was evidence also that even without the use to them of express words to that effect, those approaching the site took what they saw there as being what, to them, was "a picket line".

2. The primary Judge, in our view, correctly emphasised (111 ALR at 526), that in considering the usage of a term such as "picket line" in the particular situation of this litigation, regard should be paid to surrounding circumstances to determine what the word would reasonably have conveyed to those who heard it used.

3. His Honour considered in detail (111 ALR at 507-521) the reaction of those approaching the Rivervale site with goods for delivery on their trucks, as well as, in some instances, the reactions of the employers of those persons when told of the situation there. Counsel for the B.L.F. took us to the evidence in some detail and pointed out that some of the incidents occurred during the "unofficial" picket of 24 July and thus concerned events for which the B.L.F. had been held not responsible. Further, as to some of the events on and after 27 July, whilst the "official" picket was in operation, counsel pointed out that his Honour had treated with reserve or rejected evidence of threatening words or gestures by those at the site to drivers with supplies, and that, in any event, this was, in the main, not conduct which had been authorised by the B.L.F.

4. These may be sound submissions so far as they go to the issue of the "purpose" of the B.L.F. But nevertheless it was open to the Court to have regard to the totality of the evidence of what transpired at the Rivervale site as throwing light upon the usage of the terms "picket" and "picket line", this, in turn, having a significant bearing upon the issue of hindering by the B.L.F. from 27 July.

5. The evidence showed that to a number of those who had approached the site but had turned away because, or partly because, of what they recognised or were told was a picket line there, that expression meant, at the least, that there would be, in colloquial language, "a hassle" in getting through to deliver their supplies, and that it was best not to persevere.

6. The effect of the evidence is well put by the primary Judge by the following passage (111 ALR at 525):
   

"There was a reasonably uniform reaction from suppliers confronted with what they understood to be, or what they were told, was a picket. Gregory, of D.S.S. Fencing, in cross-examination said that he thought it easier to pull out and leave in the face of a picket line. As I found, he retreated from the Rivervale site to the Sandringham Hotel because he was fearful of the consequences if he were to cross what he considered to be a picket line. Similarly, McWilliam of Stateside Hire, was influenced not to enter the site by the advice he received that a picket line had been established. Alvan Jacques of Aaron Lee Pest Control, who arrived at the site on 27 July, adopted the attitude that as a member of the BLF he could not cross the picket line and would be considered a scab and black banned from other union sites if he did. Ricci of Advance Formwork, also a BLF member, took a similar view. He believed that if he crossed the line he might as well tear up his union ticket. Susan McGuire of Jiffy Foods did not hear any reference to the term 'picket line' but said in cross-examination that her boss had told her 'don't go through a picket line'. If she had heard that expression used at the site it would have given her pause. Gericevich would not enter the site without an express clearance from a BLF official and, as I have found, one of the factors which influenced his attitude in that respect was the existence of the picket line. The picket line was also a factor which influenced Owen of Maddington Concrete to decline to enter the site."

His Honour continued (at 526), in an important passage:

"In my opinion, there can be little doubt in this case that to the drivers of vehicles bringing goods and services to J-Corp at Rivervale the existence of a picket line involved at least a request, and probably a direction, that they should not enter. In the absence of any express disclaimer or advice that the line could be crossed, it was so understood by those participating and those drivers who approached the site. That finding is consistent with my acceptance of Reynolds' testimony and that of Keogh that instructions were to be given that no-one was to be stopped from crossing the line. I take that to mean that those participating in the picket were to be told that they should not physically stop anyone from crossing nor explicitly direct or request anyone not to cross the line."

(Emphasis supplied)

This passage was much criticised by counsel for the B.L.F., but, in our view, was well based upon the evidence, save for the words we have emphasised. Those words should not be treated as laying any satisfactory ground for the adverse finding on the issue of the B.L.F.'s "purpose". Otherwise the passage properly and significantly points to the finding which was made as to the "hindering" of supply.

1. The primary Judge held (111 ALR at 534):
   

"Neither Reynolds or Keogh authorised any physical obstruction to vehicles bringing supplies to the site. Nor did they authorise the making of any threats or requests to drivers of supply trucks directed to preventing them from entering. They were conscious of the legal implications of such conduct and had received advice in relation to it from the B.L.F.'s solicitors."

His Honour also found (at 535):

"Having regard to the conclusions I have reached (at 526, in a passage set out above) about the common understanding of the function of a picket line both by those participating in it and those supplying goods and services to J-Corp, the establishment and maintenance of the line involved an implied direction that it should not be crossed and an implied threat of unspecified sanctions in the event that it were crossed. In my opinion, in a real and practical sense and consistently with the observations of Deane J (in Australian Broadcasting Commission v Parish

(1980) 43 FLR 129 at 153), the establishment and maintenance of the picket line by the B.L.F. was conduct which at least hindered and in some cases prevented the supply of goods or services to J-Corp. To the extent that there is evidence of explicit directions attributable to the B.L.F. that suppliers should not enter, those directions also constitute conduct hindering supply."

The phrases which we have emphasised are open to criticism insofar as they would found any finding against the B.L.F. on the issue of "purpose". But the passage nevertheless contains findings as to hindrance which were open to his Honour on the evidence. The first of the primary issues on the appeal should be decided adversely to the B.L.F. The activities of the "official" picket affected to an appreciable extent the ease of the usual way of the supply of goods and services to J-Corp at the Rivervale site, and, therefore, within the meaning of sub-s. 45 (1) hindered that supply.

1. In the light of the conclusion we have reached on the second branch of the appeal, it is unnecessary to determine whether the declaration made by the primary Judge was well founded, insofar as it extended beyond "hindering" to "prevention" of supply.
   Purpose

2. Paragraph 4F (b) of the Act provides:
   

"4F (b) For the purposes of this Act -

(a) . . .

(b) a person shall be deemed to have engaged or to engage in conduct for a particular purpose or a particular reason if -

(i) the person engaged or engages in the conduct for purposes that included or include that purpose or for reasons that included or include that reason, as the case may be; and

(ii) that purpose or reason was or is a substantial purpose or reason."

1. Paragraph 4F (b) does not apply in relation to sub-s. 45D (1); but a person shall be deemed to engage in conduct for a purpose mentioned in sub-s. 45D (1) "if he engages in that conduct for purposes that include that purpose". Sub-section 45D (2) so provides.

2. In the present case, no reliance is placed upon the defence provided by sub-s. 45D (3); this provides yet another variation upon the concept of purpose by specifying that "the dominant purpose" for the conduct in question is "substantially related to" inter alia, the remuneration, conditions of employment or working conditions of the person otherwise contravening s. 45D, or of another person employed by the employer of that person; see para. 45D (3) (b) (iii). The phrase "dominant purpose" perhaps harks back to the notion of "predominant purpose", with which the tort of conspiracy is concerned; see Crofter Hand Woven Harris Tweed Co. Ltd v Veitch (1942) AC 435 at 445.

3. The findings of the primary Judge on the issue of "purpose" appear principally in the following important passage (at 537):
   

"The ultimate purpose of the picket line in this case was to obtain, by placing pressure on Homeswest, assurances that organisers would have the right to enter the Rivervale site to inspect conditions and amenities there and ensure compliance with the relevant requirements of the award. I accept that it was not part of that ultimate purpose as contemplated by Keogh and possibly Reynolds, to either embarrass or place economic pressure on J-Corp. I do not accept that that purpose would have been absent from the contemplation of Fox, Pallott and Young and others participating in the picket line. It was, however, highly likely and in the contemplation of all concerned in the hierarchy of (the B.L.F.) and on the picket line that the existence of the picket would cause suppliers to turn away from the site. While Reynolds and Keogh expressly eschewed conduct which would amount to 'stopping' suppliers they did so, I think, in the belief that the avoidance of physical obstruction or explicit threats or directions would take the case out of the reach of s. 45D. It is not possible, however, to avoid the conclusion that they would have known and accepted that in the absence of any express disclaimer the picket would in all probability have the effect of deterring entry by suppliers onto the site. I consider that Reynolds and Keogh accepted that probability although I allow the possibility that they may well have regarded it as a consequence explicable at law as the exercise of the free choice of the supplier rather than as a consequence of the picket. In my opinion, however, it was a likely consequence of the picket line. It was accepted as a likely effect and in my opinion formed part of the purpose of the conduct.

The question then arises whether the purpose so established so embraced a purpose of causing substantial loss or damage to the business of J-Corp. The word 'substantial' requires loss or damage which is more than trivial or minimal. . . ."

(Emphasis supplied)

Counsel for the B.L.F., with reference to the first of the sentences we have emphasised, submitted that the attitudes of Messrs Fox, Pallott and Young were not probative of the purpose of the B.L.F. itself. We accept that submission and the corresponding submission as to the reliance placed later in this passage upon the mental processes of Keogh.

1. After referring to passages in Tillmanns Butcheries Pty Ltd v Australasian Meat Industry Employees' Union (1979) 42 FLR 331 at 338, 348, and Building Workers' Industrial Union of Australia v Odco Pty Ltd (1991) 99 ALR 735 at 769, the primary Judge (111 ALR at 538) concluded:
   

"Interference with the provision of materials and services to a major building contractor of the kind undertaken in this case will necessarily cause delay and expense to the builder. And in the circumstances of this case, the continuation of this picket line for any period of time would in all probability have inflicted loss or damage on the business of J-Corp that could not be said to be ephemeral or trivial. The concept of substantiality does not require a consideration of the full range of building contract undertaken by J-Corp or its gross annual revenue or profitability. It is sufficient to say that the likelihood of non-trivial loss or damage in the context of this major building contract was a necessary consequence of the commonly contemplated effect of the establishment and maintenance of the picket line. It was, in that way, embraced in the relevant purpose and it was, in my opinion, a likely effect of the continuation of the conduct."

(Emphasis supplied)

Accordingly, his Honour concluded that J-Corp had succeeded in showing that the B.L.F., by establishing and maintaining the picket line at the Rivervale site from 27 July 1992, had contravened s. 45D of the Act.

1. We understand the primary Judge to have reasoned that
   

(i) on the facts as he had found them the B.L.F. had engaged in conduct, the necessary consequence of which, given the significance on the evidence of the use of the term "picket line", had been the hindering of the supply of goods or services to J-Corp;

(ii) the occurrence of this state of affairs had been highly likely in the absence of an organisation of the picket in such a way as to ensure the bringing home at the site to those third party suppliers an express disclaimer by the B.L.F. of any intention or wish to prevent their entry to the site;

(iii) the B.L.F. should be taken as having accepted this highly

likely consequence of its conduct because Mr Reynolds "would have known and accepted" this probability, and

(iv) the necessary purpose had been established.

1. Step (i) certainly may be accepted, and the same may be true of step (ii). But, in our view, the chain breaks at step (iii). We accept the submission of counsel for the B.L.F. that the primary Judge fell into error of law by, in effect, applying to Mr Reynolds and thus to the B.L.F. what, in another setting, Dixon CJ described as the "seldom helpful and always dangerous" precept that a man is "presumed to intend the reasonable consequences of his act"; see Stapleton v The Queen (1952) 86 CLR 358 at 365; Parker v The Queen (1962) 111 CLR 610 at 632.

2. It is true that, in terms, the primary Judge had set out extracts from the following passage in the judgment of Deane J in this Court in Tillmanns supra at 349. But in the result, his Honour appears to have overlooked the caution in that portion of the passage which we shall emphasise:
   

"It suffices, for present purposes, to say that, in my view, the question to be answered in determining whether conduct was engaged in for a 'purpose' mentioned in s. 45D (1) of the Act is, to adopt the words of Viscount Simon LC in Crofter Hand Woven Harris Tweed Co. Ltd v Veitch

(1942) AC 435 at 444-5, to be answered not by reference to whether it was appreciated that the relevant conduct might have the specified effect but by reference to the real reason or reasons for, or the real purpose or purposes of, the conduct and to what was in truth the object in the minds of the relevant persons when they engaged in the conduct in concert. In so far as the union was concerned, its purpose must, of course, be determined by reference to the purpose of those through whom it acted."

1. The question on this branch of the appeal then becomes whether, upon the evidence, it would have been properly open to find that the real reasons for the conduct of the B.L.F., determined by reference to those of Mr Reynolds, were such as to bring it within sub-s. 45D (1). The further or alternative submission of counsel for the B.L.F. was that if they were to be construed as findings as to the "real" reasons and purposes of the B.L.F., the conclusions of the primary Judge were quite contrary to the evidence.

2. In re-examination, Mr Reynolds was asked whether, in deciding that picket should take place, any part of his purpose involved a campaign that was to be waged against the Buckeridge group, of which J-Corp was a member. He replied "No". He was asked what was his purpose in holding such a picket. He responded:
   

"All we wanted to do was to put a protest, a picket as everyone is referring to it, to put a protest or a picket, whichever fits, down there to highlight the role of the government in giving a five and a half million dollar contract to a company like this who were refusing right of entry, failing to recognising employees' rights etc. We don't - we really were angry that Homeswest had gone against an under-taking given to us that whoever won the contract, it would certainly be in accordance with their contract which requires that proper facilities such as amenities, workers compensation cover and the recognition of employees' rights, the recognition of unions' right of entry, all would be abided by. And then we found out that that was not happening. And we certainly wanted to get people on to the site so as we could prove - as we have now proven in another court - that there is employees on the site and we should be able to obtain right of entry. And by discussions that I had with the Minister for Labour when (I was) in Canada, we were able to get an agreement with the government that forced J-Corp to allow us right of entry on to the site."

Earlier, in cross-examination, he had said that the "main thrust" of the protest at the Rivervale site "was to embarrass the Government and Homeswest because we saw them and still see that it is the Government who is at fault here".

1. Whilst Mr Reynolds, Mr Keogh and Mr Drake-Brockman had been at the East Perth lockup on 24 July 1992, important conversations had taken place. Mr Drake-Brockman had told them that the formation of a picket line at the Rivervale site could lead to legal action and that they ought to be very careful; nobody should be stopped or hindered by such a picket line from gaining access to the site. In his reasons for judgment, the primary Judge after retailing this advice continued (111 ALR at 507):
   

"Reynolds said in evidence that he instructed Keogh accordingly. The picket line was to be established simply to protest and inform people about J-Corp's refusal of right of entry to union representatives. If there were to be a picket line then, he said, it was to be conducted lawfully and in accordance with advice from their lawyers with nobody to be stopped from crossing the line. Keogh said that he himself used the term 'American style picket line' to describe what he had in mind. He maintained in any event that it was essential that there be people allowed onto the site who could be characterised as employees because he regarded their presence as a precondition of the right of entry under the award. Reynolds said he made it clear to Keogh that if there were to be a picket line set up on the Monday it would have to be well disciplined and that people were not be 'running riot'. The main thrust of any protest was to embarrass Homeswest and the State Government. Reynolds and his colleagues were angry about what they regarded as a breach of an undertaking which had been given by Homeswest.

. . .

Reynolds accepted in cross-examination that Graham Pallott as the relevant area organiser would be responsible for organising and conducting the picket line with Kim Young. They were, he said, responsible for looking after the dispute. Reynolds' evidence in this regard was not effectively challenged in cross-examination and in my opinion was probably a true account of the substance of the discussion and instructions that passed between himself, Keogh, Young and Drake-Brockman at the East Perth Lockup on the afternoon of 24 July 1992. My findings in this respect, however, are to be read in the light of the significance of the use of the term 'picket line' which is discussed later in these reasons."

(Emphasis supplied)

1. Where purpose or other state of mind of an individual in relation to a given transaction is in issue, the statements of that person in the witness box, in a sense provide, the "best evidence". But the Court may well take the view that these statements should be tested closely. ASX Operations Pty Ltd v Pont Data Australia Pty Ltd (No. 1) (1990) 27 FCR 460 at 481-3, provides a striking example. Here, the evidence of Mr Reynolds as to the purpose of the B.L.F. was scarcely tested at all in cross-examination.

2. This is not a case where the Court has rejected the evidence of a witness and done so in the absence of cross-examination; as to which see Byrne and Heydon, eds., "Cross on Evidence", 4th Aust. Ed., 1991, 17455. The evidence of Mr Reynolds was accepted. But nevertheless, for the reasons given principally in the passages at 526 and 537, which we have set out above, the primary Judge went on to find against the B.L.F. on the issue of purpose.
   Conclusions

3. In the result, our view is that the appeal should be allowed, with costs. The declaration made 9 December 1992 and order 1 of the costs orders made 19 February 1993 should be set aside. In place of order 1, it should be ordered that the respondent pay the appellant's costs of the action up to 19 February 1993. Orders to that effect made by this Court will exhaust the subject matter of the appeal. It will remain for the parties to have the proceeding relisted before a Judge of the Court for the final disposition of the balance of the proceeding, in a manner which reflects the conclusions as to liability reached by the Full Court.

JUDGE2

SPENDER J I have had the advantage of reading in draft form the reasons for judgment of Lockhart and Gummow JJ. I agree that the appeal should be allowed, because for the reasons which their Honours give, on the evidence before and the findings of the learned primary judge, the purpose of The Australian Builders' Labourers' Federated Union of Workers - Western Australian Branch ('B.L.F.') was not any of the purposes required to be established for a contravention of s. 45D(1) of the Trade Practices Act 1974. I agree also with the orders proposed by Lockhart and Gummow JJ.

1. I wish only to make observations on two matters. The first is the question of 'conduct' in s. 45D. The section requires conduct that hinders or prevents the supply or acquisition of goods or services. It is necessary to identify with precision what is in truth the conduct of the alleged contravener. That conduct has to be assessed in the context of all the circumstances, but the conduct of the alleged contravener is not necessarily to be equated with somebody's understanding of what that conduct might be. I am here referring, for example, to what might be a person's reaction to simply seeing a person outside a building site wearing a B.L.F. T-shirt.

2. In an attempt to clarify the point I am trying to make, take the example of a lone protester outside a furniture shop bearing a placard which says "This shop makes furniture out of Amazonian rainforest timber. Please shop elsewhere. " A prospective customer might, on reading the placard, be persuaded to shop elsewhere. Another prospective customer, on seeking the protester carrying a placard, might go away because he or she did not want to become involved, or feared that he or she might be 'hassled', to use Lockhart and Gummow JJ's colloquialism. In neither case, in my opinion, would the conduct of the protester constitute "conduct which hindered or prevented" the prospective customer from entering the shop.

3. The second matter is related to the first. The reasons for judgment of the learned primary judge are based in large measure of what he described as "the common understanding" of a picket line. Particular reference was made to the Oxford Dictionary definition of "picket" which incorporates the function "to dissuade or deter" persons going to work during a strike, and to the Macquarie Dictionary definition, which speaks of persons aiming to "dissuade or prevent" workers from entering a building during a strike.

4. "Deterrence" is not the same as "prevention", nor is either the same as "dissuasion". In the same way, a "request" is not the same as a "direction".

5. Given that a "picket" can have many and different meanings, ranging from the military connotation of somebody on guard duty to the lone protester, it is, in my respectful view, wrong to commence with the premise that in an industrial context, a picket line involves a prima facie contravention of s. 45D, and such a contravention can be avoided if there is a sufficient disclaimer that access is not prevented or hindered.

6. The freedoms of speech and assembly, including the right to protest, are important democratic freedoms. Also important, I accept, is the entitlement of persons not to be victims of conduct in contravention of s. 45D of the Trade Practices Act.

7. The learned primary judge said:
   

" This decision is not to be taken as advancing a general proposition that the establishment and maintenance of an official picket line by a union is always and in all circumstances unlawful. Each case must depend on its own facts. Contemporary usage of the term 'picket' does carry implications of direction and threat of sanction to those who seek to enter a site or premises the subject of a picket. While the threat of sanction remains, albeit unspoken, the possibility of characterising the use of the picket as a hindering or prevention of supply is also present. The implication may be defeated and the possibility averted by a combination of steps. These might include some explanation that the assembly is a demonstration to draw attention to an industrial issue and some explicit clearance to suppliers to enter which would negative any threat of sanction. The provisions of s. 45D do not and should not affect rights of assembly and free expression. They do prohibit the concerted use of threats to suppliers whether express or implied with the purpose and likely effect of causing damage to the business of another. "

1. In my opinion, this passage in his Honour's reasons is predicated on a false premise, namely that there is a common understanding of what a "picket" is, and that because of that common understanding, the maintenance of what is described as a picket or a picket line is prima facie a contravention of s. 45D.

2. It is not to be presumed that the maintenance of a picket is a contravention of the section unless steps such as those suggested are taken. Whether a contravention is made out depends on the evidence and the terms of the section.