Whim Creek Consolidated NL v Colgan

Re: STEVEN McGEE
And: J.H. SANDERS; C. KEILY; K. WISE; H.E. WEIR; G.R. NEWMAN; R.J. HORE; B.R.
AGG; D. CRUMP; K.J. CONNORS; G. WOOD; J.M. BILTRIS; J.B. WHITE; D.A. PORTER
and P. POWER
No. V I32 of 1991
FED No. 467
Industrial Law
30 FCR 565

COURT

IN THE FEDERAL COURT OF AUSTRALIA

VICTORIAN DISTRICT REGISTRY
INDUSTRIAL DIVISION
Heerey J.(1)

CATCHWORDS

Industrial Law - access to documents and records of Union by Branch office holders.

Industrial Relations Act 1988: Ss.4, 192, 209(3)

Conciliation and Arbitration Act 1904: Ss.4, 136

Rules of the Transport Workers Union of Australia: Rules 30(a), (b), (d) and (e), 32(c) and (d), 38(b) and (e)(iv), and 40(b)

Allen v Townsend (1977) 31 FLR 431

Bennetts v Board of Fire Commissioners of New South Wales (1967) 87 WN(NSW) 307

Berlei Hestia (NZ) Limited v Fernyhough (1980) 2 NZLR 150

Birmingham City District Council v O (1983) 1 AC 578

Burn v London and South Wales Coal Company (1890) 7 TLR 118

Conway v Petronius Clothing Co Limited (1977) 1 WLR 72

Duane v Granrott (1982) VR 767

Edman v Ross (1922) 22 SR(NSW) 351

Jones v Dunkel (1959) 101 CLR 298

Molomby v Whitehead (1985) 7 FCR 541

Scott v Jess (1984) 3 FCR 263

Williams v Hursey (1959) 103 CLR 30

HEARING

MELBOURNE

#DATE 13:8:1991

Counsel for the Applicant : M.R. Hickey

Solicitors for the Applicant : Holding Redlich

Counsel for the Respondents : H. Borenstein

Solicitors for the Respondents : Nowicki and Co

ORDER

The respondents and each of them perform and observe the Rules of the Transport Workers Union of Australia by refraining from hindering or obstructing the applicant in gaining access to and inspecting:

(a) all securities, money market bills, certificates of deposit, government bonds and inscribed stock operated, managed and controlled by the Victorian Branch of the Union since 27 September 1989 whether by way of acquisition, disposition or retention, including documentation evidencing ownership or control thereof;

(b) bank statements in respect of all bank accounts operated, managed or controlled by the Branch since 27 September 1989 whether such account was opened, closed or maintained, including the name of each such account and the weekly balance thereof;

(c) certificates of title in respect of any real property operated, managed or controlled by the Branch since 27 September 1989 whether by way of acquisition, disposition or retention.

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

JUDGE1

On 27 September 1989 the applicant Steven McGee was elected as one of two Trustees of the Victorian Branch of the Transport Workers Union of Australia ("the Union"). By virtue of that office he also became a member of the Branch Committee of Management ("BCOM"). In this case Mr McGee seeks orders which will give him access to various documents and records of the Branch. His claim to do so is resisted by the respondents, who are the other members of BCOM. Although this case is mainly concerned with the construction of the rules of the Union and the rights which those rules and the common law give to holders of offices such as those held by Mr McGee, there are other issues which make it necessary to refer briefly to the factual background. As might be expected from the very fact that a dispute of this nature has to be resolved by the Court, there is a background of hostility and mutual distrust between the parties.

Although the dispute had arisen at an earlier stage, the formal dialogue between the parties commenced with a letter dated 30 July 1990 from Mr McGee to the third respondent, Mr Keith Wise, who is the Branch Secretary. The letter stated at the outset that Mr McGee was writing "as Trustee concerning a number of irregularities in the operation of the Branch". Complaints were made about the engagement of staff, the purchase of a property in Rouse Street, Port Melbourne, the making of loans, and in particular to the West Australian Branch of the Union, an alleged failure to circulate full audited accounts and alleged invalidity of a special meeting of the Branch held on 23 July. The letter included the following request concerning access to documents of the Branch:

I refer to Rule 32(d) which sets out the responsibilities of the Branch Trustee. I note that I, as a trustee, am responsible for the safe custody of all documents, securities and accumulated funds of the Branch and am responsible for controlling all property of the Branch and the investment of any accumulated funds of the Branch in securities allowed by law as the Branch may direct. I request that you allow me access to all documents, securities and other such papers for the purpose of me satisfying myself that they are held in safe custody. I note that I have previously been denied access. Unless I am granted access I shall take the necessary steps to gain access. Further I shall be writing to the Branch's bankers asserting my rights as trustee and advising them that any decisions to be made in respect of investing of Branch funds is to be referred to both myself and my fellow trustee, Hamish Weir. Such powers, we have, must be exercised jointly and not individually as has happened in the past.

The letter concluded with a request for Mr Wise's urgent attention and a threat that in the absence of a satisfactory written response recourse would be had to the Federal Court. Copies were sent to all members of BCOM.
Mr McGee's letter was followed up on 24 August 1990 by a letter from his solicitors, Messrs Holding Redlich. That letter asserted Mr McGee's right in his capacity as Branch Trustee to have access to all documents and in particular those relating to the Rouse Street property. The letter stated:

In order to fulfil his duties as Trustee he must discharge his obligation in respect of the acquisition of Rouse Street. Such obligations require him to be responsible for the safe custody of branch funds and property. Failure to grant him access denies him the opportunity of discharging his obligations.

The letter stated that Mr McGee would attend at the Branch office on the following Monday for the purpose of examining "all documents, correspondence and title deeds relating to Rouse Street". The threat to commence proceedings in the Federal Court in the absence of compliance was repeated. There was no evidence before me as to whether the visit took place.
On 26 October Mr McGee wrote again to the Secretary. The letter referred to r.32(c) and r.32(d) which set out the duties of the Branch Secretary and Branch Trustees respectively. The letter included the following:

In order for me to carry out my duties as Branch Trustee I seek of you the following information. If you fail to provide me with this information I shall seek a direction of the Branch Committee of Management that it directs you to provide such information to me. Failing such a direction I shall seek orders of the Federal Court directing you to do so.

(a) A list of all Branch securities or securities which are held in the name of the Branch.

(b) A list setting out all accounts operated by the Branch and in respect of each account advice on the balance as at Monday 29 October, 1990.

(c) A list particularizing all other funds held by the Branch which are not deposited in Bank accounts. That is to say money market bills, certificates of deposit, Government securities and the like.

(d) I also seek of you details of Branch expenditure to be provided to me on a fortnightly basis.

That letter provoked a response from Mr Wise dated 29 October in these terms:

The various applications and interpretations contained in your correspondence of 26th October, 1990 have been noted and filed along with all earlier allegations, questions, interpretations and advices of pending legal action. These matters are under consideration and we shall write to you in due course about these matters.

. Nothing further was heard and on 17 December Mr McGee wrote again referring to "previous correspondence and your replies thereto in respect of my duties as Trustee". The letter stated:

The information to which I need access in order to discharge those duties as Branch Trustee and in particular those under Rule 32(d) and to satisfy myself as to the safe custody of securities and accumulated funds of the Branch are:-

1. all securities of the Branch and documentation evidencing ownership or control of the accumulated funds of the Branch;

2. statements for all bank accounts operated by the Branch;

3. money market bills, certificates of deposits and government securities such as inscribed stock and the like; and

4. the Certificate of Title in respect of Rouse Street.

The letter indicated that if inspection was refused Mr McGee would raise the matter at the next BCOM meeting, which was to be held on 4 February 1991. It is to be noted that this letter sought access to the documents themselves, as distinct from lists or other details concerning them.
On 23 January 1991 Mr Wise replied:

Your request in your letter dated 17th of December, 1990 for information goes well beyond any of the duties of a Branch Trustee as specified in rule 32(d) of the rules of the Transport Worker's Union.

As Victorian Branch Secretary, I am not prepared to comply with any request for information specified in your letter dated the 17th of December, 1990 unless directed to do so by a Branch Committee of Management resolution.

Mr McGee replied on 29 January repeating his request for access to the information described in his letter of 17 December and giving notice of a resolution to be put to the meeting of 4 February confirming the right of access sought. Mr McGee attended the BCOM meeting on 4 February but at the outset a dispute arose over Mr McGee's attempted use of a tape recorder. The Chairman pointed out that a resolution of an earlier meeting had prohibited the use of recorders. Mr McGee insisted on using his tape recorder and refused to leave the meeting. Ultimately police were called and he left under protest. The meeting then continued and at a later stage a resolution was carried directing the Branch Secretary to prepare a report upon the custody of documents, securities and accumulated funds of the Branch for the next BCOM meeting. Mr McGee was subsequently advised of this resolution by letter on 12 February.
At an extraordinary meeting of BCOM held on 12 March 1991 Mr McGee was suspended from office as Branch Trustee for a period of three months on the ground that he had allegedly made false statements in the media about the finances of the Branch.
Mr McGee then commenced this proceeding VI 32 of 1991 and on 9 April obtained from Gray J. a rule to show cause why his suspension should not be treated as null and void and why the respondents should not be restrained from hindering or obstructing him in gaining access to and inspecting certain financial documents (being substantially those sought in his letter of 17 December) and also the minutes of BCOM meetings.
An application for interlocutory relief was heard by Keely J. on 17 April and on 22 April his Honour refused that application in relation to the access direction in the rule nisi. However the minutes were provided by agreement. Subsequently on 24 July Ryan J. by consent made absolute that part of the rule which related to the suspension.
In the meantime, on about 27 June, the Branch Secretary provided to BCOM and to Mr McGee the report requested by the meeting of 4 February. This report annexed audited statements of the Victorian Branch for the year ended 31 December 1990 and was in the following terms (formal parts omitted):

2. Fixed Assets

(i) The registered owner of the property located at 214 Graham Street, Port Melbourne is the Transport Workers' Union of Australia, and the duplicate Certificate of Title is held by the Solicitors to the Federal Office.

(ii) The registered owner of the property located at 52-56 Rouse Street, Port Melbourne is the Transport Workers' Union of Australia, and the duplicate Certificate of Title at present is at the Titles Office.

3. Banking

In accordance with Rule 38 of the rules of the Union all bank accounts are conducted with the Commonwealth Bank, Port Melbourne. Details fo these accounts can be found on page 6, note 5 of the 1990 Audited Accounts.

4. Investments

(i) Details of investments in inscribed stock can be found on page 6, note 4 of the 1990 Audited Accounts.

(ii) All funds at the Commonwealth Bank and all investments are guaranteed by the Commonwealth Bank of Australia, and the Federal or State Governments.

(iii) With the exception of shares in a private company ($2,000.00), all amounts referred to in Item 4(i) are authorised trustee securities.

(iv) All investments made prior to and during the year ended 31st December, 1990, have been made pursuant to the rules of the Transport Workers' Union of Australia.

(v) Documentation pertaining to all bank accounts and investments are in the custody of the Branch. All such documents were viewed by the Branch Auditor when preparing the 1990 Audited Accounts.

(vi) Shares in a printing company, namely Industrial Printing and Publicity Pty. Ltd., are held by a number of trade unions and declaration of trust certifying a change in trustees holding the shares was signed by both Branch Trustees in

1991. I attach a copy of the said declaration.

The details of bank accounts referred to in the audited accounts simply gave the names of the accounts and the balances as at 31 December 1990 and 1989. The details of investments in inscribed stock listed the authorities issuing the stock (Telecom, MMBW etc) and the amounts held, again as at 31 December 1990 and 1989.
The Rules
The Union's Rules provide for the establishment of Branches. Each Branch is to elect a committee of management which, subject to the rules, is to "have control of all business of the Union within the area over which it is constituted to operate" and is to consist of a Branch President, Branch Vice President, Branch Secretary, two Trustees and not less than seven and not more than 11 Committeemen (r.30(a)). All these are elected officers (r.30(b)). The Branch is given a number of specific powers including the power to "vote and expend any money that may be necessary in connexion with the business of the Branch" (r.30(d)(ii)). All officers, organisers and employees of the Branch are to be "subject to the control and direction of (BCOM) as expressed through the Branch Secretary" (r.30(e)).
Rule 32 is concerned with the duties of the Branch Officers. In the case of the Secretary and Trustee the rule provides:

(c) Secretary

The Branch Secretary shall be competent to discharge all duties assigned to him by the Branch Committee of Management, and shall attend all meetings connected with the Branch when practicable. He shall attend to all correspondence, keep a copy of all letters and wires despatched. He shall give an official receipt for all moneys received, and bank such moneys to the credit of the Branch at least weekly. He shall keep all documents, books and accounts relating to the business of the Branch. He shall issue notices to members, particularly to those who are in arrears with their dues. He shall hand over to the Branch Auditor all property, books, documents and moneys belonging to the Branch within twenty-four hours after being requested to do so by resolution passed at any meeting of the Branch Committee of Management. He shall further discharge such duties as may be allocated to him from time to time by the Branch Committee of Management. He shall, if deemed necessary, find security in such a sum as the Branch Committee of Management may decide, the premium to be paid by the Branch. He shall be allowed a sum not exceeding $100.00 as determined by the Branch Committee of Management from time to time.

Such amount, once determined, shall be reimbursed by cheque drawn from the Branch Bank account for petty cash, to be drawn by cheque from the Branch General Fund account. The Secretary shall be custodian of the moveable property of the Branch. Notwithstanding anything contained elsewhere in these rules he shall also be in sole charge of the Branch office and those employees connected with the work thereof.

(d) Trustees

Branch Trustees shall -

(i) Be responsible for the safe custody of all documents, securities and accumulated funds of the Branch; such documents, securities and funds shall be deposited by the Branch Secretary in the name of the Branch at a place determined by the Branch Committee of Management; and

(ii) Act on a resolution of the Branch Committee of Management under the hands of the Branch President and Branch Secretary; and

(iii) Subject to direction of the Branch Committee of Management, control all property of the Branch; and

(iv) Invest any accumulated funds of the Branch in securities allowed by law as the Branch Committee of Management may direct.

Rule 38 is headed "Funds - Banking and Disbursement". Bank accounts are to be in the name of the Union and "shall be and always remain the sole property of" the Union until disbursed pursuant to the Rules (r.38(b)). Withdrawals are to be by cheques signed by a President, Vice President or one of the Trustees countersigned by the Secretary (r.38(e)(iv)). Rule 40 provides for annual audits. The auditor is to be appointed by BCOM and has power to call for all books, papers, vouchers and documents belonging to the Branch (r.40(b)).
Access to Documents by Trustee

Both historically and as a matter of contemporary legal understanding the essential function of a trustee is the holding of legal title to property on behalf of another. But there seems to be little need for this function in respect of an organisation of employees registered under the Industrial Relations Act 1988 or its predecessor the Conciliation and Arbitration Act 1904. Since the inception of Commonwealth industrial legislation in Australia, such organisations have enjoyed the status of separate legal entities capable of holding property: Conciliation and Arbitration Act s.136, Industrial Relations Act s.192. Although typically unions registered under the Commonwealth system have a federal structure with branches in two or more States or Territories, it has been firmly established, at least since Williams v Hursey (1959) 103 CLR 30 at pp 54-55, that branches of such unions are not legal entities separate from the members of the branch or the union itself.
The only reference to a trustee in the legislation is a somewhat oblique one. In s.4 of the 1988 Act "office" is defined to mean, amongst other things,

(e) the office of a person holding (whether as trustee or otherwise) property:

(i) of the organisation or branch; or

(ii) in which the organisation or branch has a beneficial interest.

The definition of "office" including the expression "whether as trustee or otherwise" first appeared in 1949 when it was inserted in s.4 of the 1904 Act by Act No. 28 of 1949. It was that Act which introduced machinery for resolving election disputes (Division 3 of Part VI), thus perhaps suggesting an emphasis on electoral accountability for all office holders, including trustees. At any rate, it seems a little incongruous that the legislation still speaks of property "of the organisation or branch" as though they were two entities of a like nature equally capable of owning property. Plainly, after Williams v Hursey, this is not the case. There must be real doubt whether it would even be theoretically possible to have rules of an organisation which provided a structure whereby the individual members who from time to time constituted a branch could own property with the consequence that the organisation itself did not own that property. See especially the judgment of Fullagar J. in Williams v Hursey (1959) 103 CLR at p 55. However, at the very least such a structure would have to be spelt out clearly in the rules.
Against that background, it would seem that any role of Branch Trustees of the Union is likely to exclude the central traditional function of a trustee as the holder of legal title on behalf of another. But the respondents' argument was that the Branch Trustees in the present case did have a function of holding property on behalf of the Branch, that it was the Branch Trustees' role to be nominated owners on behalf of the Branch, and no more. They were not watchdogs. They were to be subject to the control of the Branch, through BCOM and the Secretary and, even as to custody of documents and the like, they were subject to what was called the Secretary's "overarching custodial role". Therefore, so the argument ran, once BCOM had satisfied itself as to any questions affecting documents of title or other financial documents, the responsibility of the Trustees was at an end. In the present case, this had happened by BCOM's obtaining of the report from the Secretary.
Turning to the detailed provisions of the Rules, counsel for the respondents emphasised those parts which give power to BCOM to direct the Trustees, especially r.32(d)(ii), (iii) and (iv). He frankly acknowledged the difficulty imposed by the opening part of r.32(d)(i), but contended that responsibility there meant responsibility in the sense of the Trustees "lending their names" for the purpose of holding securities and funds.
In my view, this argument conflicts with established doctrine as to the legal nature of registered organisations and their branches under Commonwealth legislation and also the terms of the Rules themselves. In particular I note r.38(b) which explicitly states that bank accounts are to be in the name of the Union and moneys are to remain the sole property of the Union. This clearly includes the "accumulated funds" referred to in r.32(d)(i).
I think the respective functions of Secretary and Trustees are spelled out clearly enough in r.32(c) and r.32(d), even though in some matters of detail there may be an overlap. Viewed broadly, the role of the Branch Trustees is a custodial one. They are elected officers who become members of BCOM but also have the specific duty of looking after the assets of the Branch. In some respects they have duties which would usually fall within the province of the treasurer of a voluntary unincorporated association, there being no such office provided for in the Rules. It is in my view quite consistent with this reading of the Rules that the draftsman has gone to some pains to make it clear that custody of and responsibility for the assets of the Branch does not confer on the Branch Trustees the right to deal with such assets as they see fit. They are made subject to the control of the BCOM. The Branch Secretary also has his own responsibilities, some of which relate to assets, for example banking moneys and being the custodian of "moveable property" - which I think in context means something less than all property other than real property; it is probably intended to refer to things like furniture, motor cars and the like - but even in this respect there seems to be an element of control retained by the Trustees - see r.32(d)(iii).
But however one draws the dividing line of responsibility between Branch Trustees and Branch Secretary, there seems to me nonetheless a right necessarily inherent in the office of Trustee to obtain access to the financial records of the Branch. After all, the property used by the Branch and the moneys it receives from members and from other sources and the financial records themselves do not belong to the Trustees or the Secretary, but, as a matter of law, to the Union. In aid of his proper function a Branch Trustee has in my opinion a right of access to the documents of the kind sought in this proceeding.
Access as Member of BCOM
The first point taken by the respondents here was that all the correspondence from Mr McGee and his solicitors only asserted a right in his capacity as Branch Trustee. Although there was argument to the contrary, I think as a matter of construction of the letters that is probably correct. However the fact remains that in this Court the respondents' case included a denial that Mr McGee's position as a member of BCOM gave him any right of access to the documents. It was accepted by the respondents' counsel that no prejudice in terms of presentation of the respondents' case arose by reason of the fact that a claim in this capacity had not been raised in the correspondence. What was put was that BCOM had never had the opportunity of considering Mr McGee's claim in his capacity as a BCOM member and that therefore no order should be made but, if I were to find a prima facie right existed, BCOM should have the opportunity to consider whether any specific ground existed for denying access. I shall deal in a little more detail with this point when I come to the substantive law on the subject. For the present, it is sufficient to note that BCOM dealt fully with Mr McGee's claim in his capacity as trustee and it did not occur to the respondents then to raise any particular ground such as a fear of breach of confidentiality which might justify the refusal of access if a prima facie right to access existed.
There is no doubt that the director of a company has a right enforceable at law to inspect documents of a company in aid of the proper execution of his fiduciary obligation to advance the interests of the company. This was first established in Burn v London and South Wales Coal Company (1890) 7 TLR 118 and followed in a number of cases including Edman v Ross (1922) 22 SR(NSW) 351, Conway v Petronius Clothing Co Limited (1977) 1 WLR 72 and Berlei Hestia (NZ) Limited v Fernyhough (1980) 2 NZLR 150. The principle has been applied in the case of a director of a statutory corporation: Molomby v Whitehead (1985) 7 FCR 541 and a member of a local government authority: Birmingham City District Council v O (1983) 1 AC 578, with the suggested qualification that access to documents of a committee of the council by a councillor who was not a member of that committee might need to be founded on some "good reason". It seems that the right is conferred by the common law in order to enable the director to carry out his fiduciary duties and its exercise is not confined to participation in meetings; see Conway (1977) 1 WLR at pp 89-90.
The similarity in structure and function between companies and organisations of employees registered under Commonwealth industrial legislation has been well recognised: Allen v Townsend (1977) 31 FLR 431 at pp 483-486, Scott v Jess (1984) 3 FCR 263 at p 269. I do not see any logical reason why the particular rule as to access by members of the elected governing body of companies to corporate documents should not also apply to registered organisations of employees.
The only reason advanced on behalf of the respondents for not importing this principle of company law was that it was necessary to take into account the difference between unions and companies and in particular the fact that there are political factors which operate in the case of the former. Politics are certainly part of the very stuff of trade unionism in Australia. Not only has the advancement of the interests of members long been seen as something to be achieved through political and parliamentary means as well as industrial action (see Williams v Hursey (1959) 103 CLR at pp 58-59) but also, and this was more the aspect the respondents' counsel had in mind, internal disputes within unions commonly have political or ideological elements. All that may be granted, but it does not seem to follow at all that members of an elected governing body of a union, such as BCOM, who admittedly owe fiduciary obligations, should not have a right of access to the documents of the organisation for the better performance of their duties. Political and ideological disputes may generate dissension and suspicion within unions, just as commercial and financial issues do within companies, but the fiduciary obligations of those elected to govern the affairs of the corporate body remain. In both cases there exists in my opinion a right of access to documents of the body to aid the proper discharge of those obligations. I conclude that Mr McGee has a prima facie entitlement to access to the documents sought in his capacity as a member of BCOM as well as Branch Trustee.
The question then arises whether the respondents have shown, to use the language of Beaumont J. in Molomby v Whitehead (1985) 7 FCR 541 at p 550, there is "good cause to the contrary" why that entitlement should not result in appropriate relief from this Court.
Bad Faith
In Berlei Mahon J. reviewed the authorities. I would respectfully agree with his Honour's conclusion ((1980) 2 NZLR at p 163) that:

..... in order to restrain a director from exercising his right of access to corporate information, it must be proved, either from his words or conduct, that there in fact exists an intention on the part of the director to use the information not for the benefit of the company and the shareholders but for the benefit, wholly or in part, of a competitor.

I only add that of course his Honour's statement was made in the context of the case before him and abuse of fiduciary power in the case of a director of a company is not confined to conduct which might aid a competitor of the company. The essence of the conduct which would disqualify a director from exercising his right of inspection is that (to adopt again language of Mahon J.) he "is acting or is about to act in breach of his fiduciary duty to the company and intends to aid that process by inspecting the books". An example is provided by Bennetts v Board of Fire Commissioners of New South Wales (1967) 87 WN(NSW) 307 where the document sought was legal advice in relation to litigation between the organisation and a union of which the plaintiff was the Board representative.
The case of bad faith put against Mr McGee is that he did not in fact have a genuine desire to inspect the documents, but rather wanted to stir up trouble. Alternatively, if he did want to inspect the documents, his purpose was not to advance the interests of the Union or the Branch but to publish derogatory information about the respondents for the advancement of his own interests within the affairs of the Branch, particularly in the context of forthcoming elections of the Branch which are due to be held later this year.
The evidence to support this case was said to be as follows. He insisted on using the tape recorder at the BCOM meeting of 4 February, even though there had been a resolution of an earlier meeting preventing the use of such devices, and did so to the point where he was evicted from the meeting despite the fact that the meeting was to consider his motion for access to the documents. He was difficult and obstructionist at meetings and consistently voted against all motions, including such seemingly innocuous measures as the election of life members and making donations to the Royal Victorian Institute for the Blind. He also made public allegations of misconduct against BCOM. He took from June 1990 to April 1991 before bringing any action in this Court despite frequent threats to do so. Mr McGee did not give evidence and it was argued that the Court should be the more ready to draw adverse inferences against him on the basis of the rule in Jones v Dunkel (1959) 101 CLR 298.
In my view, the case of bad faith is not made out. I cannot conclude from the evidence that Mr McGee does not in fact want the information sought. He has written letters, he has instructed solicitors who have written letters on his behalf and he has instituted these proceedings. His insistence on the use of a tape recorder at the 4 February meeting may or may not have been correct in the light of the previous resolution, but the evidence does not establish that he was not acting on a belief sincerely held that recording was desirable. If he thought that the need for recording was worth insisting on to the point of being evicted, it does not follow that he was no longer interested in the quite separate matter of access to documents. He may also have thought (correctly as it turned out) that the meeting was unlikely to meet his request for access to the documents in any case.
The first respondent Mr Joseph Sanders, who is the Branch President, gave evidence. He made a number of generalised aspersions on the character and personality of Mr McGee as well as asserting that "irreparable damage" would be done to the Branch if Mr McGee was given access to the documents because he was "out on a power and glory trail. You never know where documents, which should only be in access (sic) to the branch, you never know where they are going to finish up." He asserted that they contained "business (which) should be strictly confidential to (BCOM)". However no attempt was made to explain what particular documents were being referred to and what was the nature of the business said to be "strictly confidential". And of course Mr McGee was a member of BCOM himself. Mr Sanders was only called to prove the Secretary's report of 27 June and I was somewhat puzzled why the respondents were put to proof of this matter or why Mr Sanders was cross-examined at all since it could be no part of Mr McGee's case to prove bad faith on the part of the respondents. However in my view the respondents did not establish by evidence that any of the material sought by Mr McGee was of a confidential nature such as would provide proper cause for denying him access.
The documents sought, securities, bank statements and duplicate certificates of title belonging to a body which is required to publish audited accounts, are not by their nature confidential in any relevant sense. The lack of any reference to assertions of confidentiality in the correspondence with Mr McGee or in the minutes suggests that the respondents did not in fact regard them as confidential in this sense.
As to delay, the fact is that the Court is now dealing with a final hearing of Mr McGee's claim little more than twelve months after he first raised the matter formally with the Branch. A substantial part of that period was taken up by delays of the Secretary and BCOM in dealing with Mr McGee's requests. Mr McGee has pursued his claim in this Court with reasonable expedition. He has sought interlocutory relief and, when that was not granted, a direction for a speedy trial. An applicant in his position has to tread a rather fine line, because if he is too slow he will be subject to the criticism of the sort now made but if he is too fast the Court may exercise the discretion specifically conferred on it to refuse to deal with his application on the grounds that it is not satisfied that the applicant has taken all reasonable steps to try to have the matter resolved within the organisation: Industrial Relations Act 1988, s.209(3).
It has to be remembered that the right of access is in no way conditional on somebody in Mr McGee's position making out reasonable grounds for suspicion of anyone else, or indeed any grounds at all. This is a right to be exercised by an elected officer of the Union, even if his motives (and I am not suggesting that this is necessarily the case with Mr McGee) may be no more lofty than a desire to find some damaging information about a rival faction which currently holds the reins of power. It may be that such a suspicion is totally unfounded and the exercise of the right of access provides no ammunition at all, and perhaps rebounds against those using it. But internal electoral processes of registered organisations and the vigorous debate that they often generate are matters which the law recognises as being essential for the welfare of such bodies. Elections for office holders of registered organisations are a central feature of the Commonwealth legislative system. Even false and defamatory communication between members of such organisations about its affairs are protected from action for defamation unless shown to be made with malice: Duane v Granrott (1982) VR 767. Use of a union's documents for the purposes of discussion of the union's affairs, including the merits or otherwise of the conduct of those affairs by elected officers, is for the benefit of the union, unless some specific ground for confidentiality is made out.
Has the Right of Access been Satisfied?
Reliance was placed on the report of 27 June 1991. It was said that no order should be made because this provided all the information to which Mr McGee was entitled.
I think this report falls well short of what Mr McGee was entitled to. Although he was given a copy of it, it was a report commissioned by BCOM and presented to BCOM, and took some four months to produce. Mr McGee's right in my opinion is a right to access to the documents themselves; it is not a right satisfied by the Secretary telling BCOM where the documents are and summarising the effect of documents, still less when the information is six months out of date when provided.
Orders
In my opinion Mr McGee is entitled to the orders sought, except that it seems there is no dispute now over the question of the minutes once the question of his suspension has been resolved. I order as follows:
Direct that the respondents and each of them perform and observe the Rules of the Transport Workers Union of Australia by refraining from hindering or obstructing the applicant in gaining access to and inspecting:
(a) all securities, money market bills, certificates of deposit,

government bonds and inscribed stock operated, managed and controlled by the Victorian Branch of the Union since 27 September 1989 whether by way of acquisition, disposition or retention, including documentation evidencing ownership or control thereof;

(b) bank statements in respect of all bank accounts operated,

managed or controlled by the Branch since 27 September 1989 whether such account was opened, closed or maintained, including the name of each such account and the weekly balance thereof;

(c) certificates of title in respect of any real property operated,

managed or controlled by the Branch since 27 September 1989 whether by way of acquisition, disposition or retention.

[1991] FCA 467

13 AUGUST 1991