Re Inquiry Into Elections In the Vehicle Builders Employees' Federation of Australia; Ex Parte Allen [1978] FCA 29; (1978) 34 FLR 294 (10 August 1978)

FEDERAL COURT OF AUSTRALIA

Re INQUIRY INTO ELECTIONS IN THE VEHICLE BUILDERS EMPLOYEES' FEDERATION OF
AUSTRALIA; Ex parte ALLEN [1978] FCA 29; (1978) 34 FLR 294
Conciliation and Arbitration

COURT

FEDERAL COURT OF AUSTRALIA
INDUSTRIAL DIVISION
Smithers J.(1)

CATCHWORDS

Conciliation and Arbitration - Registered organizations - Officially conducted election - Inquiries - Alleged irregularity in conduct of elections - Application for inquiry made after expiration of six months from date of completion of election - Whether applicant could not within six months by reasonable diligence have acquired knowledge of and means of establishing matters alleged to constitute irregularity - "Reasonable diligence" - What is reasonably required of persons desirous of challenging election - Inaction of applicant during six-month period - Conciliation and Arbitration Act 1904, ss. 159 (5), 170.

Conciliation and Arbitration - Registered organizations - Election - Inquiry - Alleged irregularity in conduct of election for officers - Rule providing for five years' continuous membership as qualification for eligibility to nominate for office - Subsequent declaration in separate proceedings of invalidity of rule - Similar circumstances prevailing at antecedent date when nominations called - Rule invalid when nominations called - Notice requiring nominations to be in accordance with rules - Whether notice gave rise to irregularity - Whether reference to rules in notice to be construed as reference to valid rules - Conciliation and Arbitration Act 1904, ss. 4 (1), 165. The Conciliation and Arbitration Act 1904 provides by s. 159 (1) that, where a member of an organization claims that there has been an irregularity in or in connexion with an election for an office in the organization, he may lodge an application for an inquiry by the court into the matter. Sub-section (4) provides that, where an application is made under the section in respect of an election conducted under s. 170, the industrial registrar shall refer the application to the court if the application is made within the time applicable under sub-s.(5). Subsection (5) provides:

"An application in accordance with the last preceding sub-section may be made -

(a) before the completion of the election;
(b) within the period of six months commencing on the date of completion of the election; or

(c) after the expiration of that period of six months but before the expiration

of the period of office to which the election related,
but the Court shall not proceed with the hearing of an inquiry upon an
application made in accordance with paragraph (c) unless the Court is
satisfied that the person making the application did not have, within the
period of six months referred to in paragraph (b), and could not, by
reasonable
diligence have acquired within that period, knowledge of, and the means

of
establishing, the matters that are alleged to constitute an irregularity."

The rules of an organization provided by r. 6 (d) that: to be eligible for nomination for election as federal secretary a person must at the date of his nomination - (i) have been a member of the federation continuously for at least five years; . . ." Rule 6A contained a similar provision in relation to the office of assistant federal secretary.

Under officially conducted elections for the offices of federal secretary and assistant federal secretary, the returning officer called for nominations by notices dated 9th July, 1975, and 13th September, 1975, respectively which provided, amongst other things, that the application must be in accordance with the rules of the organization and reach the returning officer not later than 23rd July, 1975, and 8th October, 1975, respectively.

On 26th August, 1977, in separate proceedings, the court made an order under s. 140 (3) declaring that rr. 6 (d) (i) and 6A contravened s. 140 (1), as a result of which, under s. 140 (5), the rules became void from the date of the order.

Applications were lodged by two members of the organization for inquiries into the elections on the ground that an irregularity in each election arose, first, from the returning officer's notices calling for nominations in that such notices notified members that in accordance with rr. 6 (d) (i) and 6A the returning officer would not accept any nominations lodged on behalf of a candidate of less than five years' continuous membership and, secondly, from the invalidity of those rules at the time fixed for lodging nominations.

Held: (1) As the applications were not made until after the expiration of six months from the date of completion of the elections, the inquiries could not, under s. 159 (5), proceed unless the court was satisfied that the applicants could not, within the six months period, by reasonable diligence have acquired knowledge of, and the means of establishing, the matters alleged to constitute the irregularity.

(2) The phrase "reasonable diligence" denoted not the doing of everything possible, but the doing of that which, under ordinary circumstances and with regard to expense and difficulty could be reasonably required of persons desirous of challenging the election on the ground of its conduct under invalid rules. On the evidence, which included the complete inaction of the applicants during the six-month period, such a standard had not been attained by the applicants. Accordingly, the applications should be dismissed.

Young v. Paddle Bros. Pty. Ltd., (1956) VLR 38 at p 42 applied.

(3) The applications should, in any event, be dismissed, no irregularity in the conduct of the elections having been established because: (a) the circumstances of the organization on 26th August, 1977, when the court, in separate proceedings, made orders declaring that rr. 6 (d) (i) and 6A contravened s. 140 (1) were substantially the same as those pertaining on 23rd July, 1975, and 8th October, 1975, the closing dates for lodging nominations for the offices of federal secretary and assistant federal secretary respectively, and accordingly, the rules were invalid for contravention of s. 140 (1) at the antecedent dates. Leveridge v. Shop Distributive and Allied Employees' Association [1977] FCA 9; (1977), 31 FLR 385 and Allen v. Townsend [1977] FCA 10; (1977), 31 FLR 431 applied. (b) Except in special circumstances, the returning officer must conduct an election according to the valid rules of the organization, and the reference in the notices, issued by the returning officer calling for nominations, to nominations being in accordance with the rules of the organization was to be understood as a reference to the valid rules: the rules lodged with the registrar or those appearing in the rule book cannot necessarily be regarded as the valid rules of the organization. Krantz v. Maynes (1967), 10 FLR 134 applied. (c) On the evidence, no member of less than five years' continuous membership had nominated nor, if such members had refrained from nominating, had they done so because the notices issued by the returning officer advised that nominations should be in accordance with the rules of the organization.

HEARING

Melbourne, 1978, March 21; August 1, 10. 10:8:1978

APPLICATIONS.

Members of an organization registered under the Conciliation and Arbitration

Act 1904 lodged applications under s. 159 of the Act for inquiries by the court into the elections conducted in 1975 under s. 170 for the offices of federal secretary and assistant federal secretary on the ground that there had been an irregularity in the conduct of the elections.

B.J. Shaw Q.C. and A.G. Uren, for the applicants.

M. Harrison, for the respondents. Cur. adv. vult.

Solicitor for the applicants: A. J. Macken.

Solicitors for the respondents: Harrison & Partners.

DECISION

August 10.

The following judgment was delivered.
SMITHERS J. These are applications by Kevin James Allen and Garry Ernest

Sherriff for election inquiries into two elections conducted by the Australian Electoral Officer for Victoria in respect of the positions of federal secretary and assistant federal secretary of the Vehicle Builders Employees' Federation of Australia (the organization). Nominations were called for on 9th July and 13th September, 1975, respectively with nominations closing on 23rd July and 8th October, 1975, respectively. On 11th September, 1975, after a ballot had been held, Mr. L.C. Townsend was declared elected to the office of federal secretary. On 28th November, 1975, after a ballot had been held, Mr. J.K. Sandilands was declared elected to the office of assistant federal secretary. The applications are based upon a claim by the applicants that there was an irregularity in or in connexion with each election. The elections having been conducted under s. 170 of the Conciliation and Arbitration Act 1904 (the Act), the industrial registrar referred them to the court. I was satisfied that there were reasonable grounds therefor. The matters alleged to constitute the irregularity in each election were: (a) that the returning officer in calling for nominations, notified members that in accordance with rr. 6 (d) (i) and 6A as they appeared in the current rule book of the federation, he would not accept any nomination which might be lodged on behalf of any candidate for election who had not been a member continuously for at least five years at the date of nomination; and (b) that, at the date fixed for lodging nominations, those rules were invalid because they contravened s. 140 (1) (c) of the Act. (at p297)

2. However, the elections having been completed more than six months before the date on which the applications were made, it was a condition of the court proceeding with the hearing that it be satisfied that the applicants had not, within the period of six months from the completion of the elections, and could not, by reasonable diligence, have acquired, within that period, knowledge of and the means of establishing the matters that are alleged to have constituted the irregularity complained of (s. 159 (5)). (at p297)

3. The evidence called by the applicants disclosed that, at the time of the holding of the elections in question, they supported the candidature of Mr. Townsend and Mr. Sandilands, the successful candidates, and for some time later, certainly exceeding six months they had no intention or desire to challenge the elections. It followed that during that time they gave no attention at all to the questions as to whether or not the rules under which the elections had been conducted were valid or otherwise. However, on or about 31st March, 1977, certain conduct which the applicants attributed to Mr. Townsend prompted them to wonder whether there were any lawful means of attacking him in his position in the federation. As a result, they consulted their solicitor. Until the time when they sought the advice of the solicitor they had not suspected that rr. 6 (d) (i) or 6A might be invalid. At the time when the solicitor was consulted it so happened that in connexion with another matter, namely, Leveridge v. Shop Distributive and Allied Employees' Association [1977] FCA 9; (1977) 31 FLR 385 then pending, the solicitor had had his attention drawn to the possibility of attacking rules such as rr. 6 (d) (i) and 6A on the ground that because of the high turnover of membership such rules might be invalid. Equipped with this experience the solicitor was able to advise the applicants that a successful challenge to the rules might be made, and in due course it was. See Allen v. Townsend [1977] FCA 10; (1977) 31 FLR 431 . (at p297)

4. True enough, the applicants did not know that rr. 6 (d) (i) and 6A were invalid at any time during the relevant six months, but the question before me is whether I am satisfied that they could not, with reasonable diligence, have acquired such knowledge during that time. In my opinion this has to be approached on the basis that they were persons who desired to challenge the election on the ground that there might have been an irregularity in its conduct, including the possibility that it had been conducted by reference to an invalid rule. If that were the case, it seems to me that reasonable diligence on the part of any such persons would have required that they consult an adviser, presumably a solicitor, acquainted with industrial law. In the case of the applicants they were well acquainted with such a solicitor. That solicitor has filed an affidavit in this case stating in effect, that he did not have to grapple with the problem of the validity of the rules in question at any time within the six months, that when he did have to grapple with it in March 1977 he was familiar with the way in which the problem had been approached in Leveridge's case [1977] FCA 9; (1977) 31 FLR 385 and that that approach, as far as he was concerned, was a novelty. However, he stops short of saying that had he been asked to advise whether any of the rules under which the election was conducted were invalid and could sustain an allegation that there was an irregularity in its conduct, he would not have come to the conclusion that there was a basis upon which rr. 6 (d) (i) and 6A could be challenged. Having regard to the imagination and research which is customarily employed in serious disputes in organizations, I cannot be satisfied that the solicitor would not have come to the conclusion that there was a reasonable case for a challenge to rr. 6 (d) (i) and 6A. That there was a high turnover of membership of the organization was a known feature of it. There is nothing in the affidavit of the solicitor to indicate that he would not have considered such a matter as significant. (at p298)

5. It seems to be very difficult for applicants who gave no thought to the problem during the relevant time and who during the relevant time had no intention of attempting to find out the relevant facts, to satisfy the court that if they had tried to do so with reasonable diligence, they would have failed within the time allowed. Of course if they had taken such steps by making an application under s. 140 of the Act, there would have been difficulties in so far as the time factor in relation to the arrangement of court business was concerned, but it is not to be assumed that if representations had been made to the court, special arrangements would not have been made to expedite the hearing. (at p298)

6. In Young v. Paddle Bros. Pty Ltd. (1956) VLR 38, at p 42 Herring C.J. referred to a statement by Dr. Lushington in The Europa (1863) 2 Moo PC (NS), at p 15; [1863] EngR 835; 15 ER 803, at p 808 that the meaning of the expression "reasonable diligence" is not the doing of everything possible, but the doing of that which, under ordinary circumstances and with regard to expense and difficulty, could be reasonably required. In my view it can hardly be said the failure of the applicants to take any action at all within the six months in question fulfils the standard of what was reasonably required by persons desiring to achieve the result of successfully challenging the election on the ground that it was conducted under invalid rules. (at p299)

7. No submission was made to me that if it had been thought desirable to seek the advice of a solicitor or even to proceed with a proceeding under s. 140 of the Act, expense would have been a barrier. I am not satisfied that the difficulty of getting the necessary evidence would have been a barrier. In view of the above it follows that the condition of the hearing of these matters was not fulfilled and the applications must therefore be dismissed. (at p299)

8. When this matter first came before the court, the court was informed that the preliminary matter discussed above could not be dealt with at that stage owing to the illness of the applicant Mr. Allen. In these circumstances, at the request of the applicants and with the concurrence of the respondents, the argument as to the existence of an irregularity proceeded. Such argument did proceed and was concluded. In all the circumstances I am satisfied it will be in the interests of the parties that I should state what my conclusion was. (at p299)

9. The rules of the organization, as certified by the industrial registrar as at the date on which nominations were required to be lodged, contained a rule in the following terms:

"6. FEDERAL SECRETARY

(a) A federal secretary shall be elected by a secret postal ballot
of all financial members of the federation. The period of office
shall expire on 31st March, 1969, and at intervals of six years
thereafter . . . .

(d) To be eligible for nomination for election as federal
secretary a person must at the date of his nomination: (i) have
been a member of the federation continuously for at least five
years; (ii) have been a financial member of the federation
continuously for at least two years immediately prior to his
nomination; (iii) have taken an active interest in the work of the
branch, sub-branch or office to which he is attached or belongs by
attending at least fifty per cent of the branch or sub-branch
meetings for at least two years immediately prior to the date of
calling of application. (iv) This condition shall not apply where:
(a) The applicant was working shift work providing he has
attended fifty per cent of the meetings of the branch or
sub-branch
which fall on the week or week days in which he works day
shift; or (b) The applicant was absent through attending to
official union business; (c) An apology with reasonable excuse
accepted by the meeting to be taken as attendance at the meeting.
. . ." (at p299)

10. Federal r. 6A dealing with the office of assistant federal secretary for all present purposes is in similar terms to r. 6 (d). That rule was also contained in the rule book which was available to members as the rule book of the organization. (at p299)

11. On 26th August, 1977, in Allen v. Townsend [1977] FCA 10; (1977) 31 FLR 431 in this Court, a declaration was made pursuant to s. 140 (3) of the Act that r. 6 (d) (i) contravened the provisions of s. 140 (1) (c) on the ground that it imposed upon members a condition which, having regard to the objects of the Act and the purposes of registration of organizations thereunder, was oppressive, unreasonable and unjust. The majority of the court stated that as a consequence r. 6A was also invalid (1977) 31 FLR at p 468 . By reason of the declaration of the court and the terms of s. 140 (5) of the Act the rules in question became void for all purposes as between all persons as from the date of declaration, namely, 26th August, 1977. It is argued that in a proceeding under s.159 the validity of a rule as at a particular date may be challenged on the ground that on that date it contravened the provisions of s. 140 (1), although the date in question preceded the date of the declaration under that section or although no such declaration had been made. For this proposition the court's decision in Leveridge's case (see applications by T.V. Moloney, N.A Webster and F.J. Maddern) (1977) 31 FLR at pp 416, 419, 421 was relied upon by Mr. Shaw Q.C. senior counsel for the applicants, and that point was not contested by Mr. Harrison who appeared for Messrs. Townsend and Sandilands. I treat it as well founded. It was then said that the circumstances of the organization which existed on the closing date for nominations, namely, 23rd July and 8th October, 1975, respectively were substantially the same as those existing on 26th August, 1977, and which induced the court to make the declaration mentioned above. It was then argued that the reasons which induced the court to make the declaration which it made in Leveridge's case [1977] FCA 9; (1977) 31 FLR 385 ought to be applied to the circumstances as they existed on 23rd July and 8th October, 1975, and on that basis this Court should proceed upon the basis that r. 6 (d) (i) and r. 6A contravened the provisions of s. 140 (1) when nominations were both called for and closed in respect of the elections referred to above. Accordingly, so it was said, for the purpose of these applications the proper view for this Court to take is that those parts of r. 6 (d) (i) and r. 6A which were regarded as being in contravention of s. 140 (1) on 26th August, 1977, were also in contravention in 1975 when nominations were called for and when they closed. I accept this contention. (at p300)

12. In these circumstances Mr. Shaw argued that there had been an irregularity within the meaning of s. 165 (1) in the conduct of the elections in which Mr. Townsend and Mr. Sandilands were elected as federal secretary and assistant federal secretary respectively. The irregularity was said to arise from the terms in which the Australian Electoral Officer, who acted as returning officer and is herein referred to as the returning officer, called for nominations. The notices calling for nominations were in the following terms: "The Vehicle Builders Employees' Federation of Australia. Election for federal secretary and court advocate. Notice is hereby given that pursuant to s. 170 of the Conciliation and Arbitration Act 1904-1974 arrangements have been made by the industrial registrar with the Chief Australian Electoral Officer for Victoria to conduct an election in the Vehicle Builders Employees' Federation of Australia for the office of - federal secretary and court advocate, and applications are hereby called in respect of the aforesaid office. Applications must be in accordance with the rules of the said federation and must reach me at the Australian Electoral Office, room 1059, Australian Government Centre, Latrobe Street, Melbourne, not later than twelve noon on 23rd July, 1975.
9th July, 1975.
L. J. Abbott (Australian Electoral Officer for Victoria conducting election pursuant to the Conciliation and Arbitration Act 1904- 1974)".

"The Vehicle Builders Employees' Federation of Australia.
Election for federal assistant secretary and court
advocate-research
officer. Notice is hereby given that pursuant to s. 170 of
the Conciliation and Arbitration Act 1904-1974 arrangements have
been made by the industrial registrar with the Chief Australian
Electoral Officer for the Australian Electoral Office for Victoria to
conduct an election in the Vehicle Builders Employees' Federation
of Australia for the office of - federal assistant secretary and court
advocate - research officer. Applications must be in accordance
with the rules of the said federation and must reach me at the
Australian Electoral Office, room 1059, Australian Government
Centre, Latrobe Street, Melbourne, not later than twelve noon on
8th October, 1975. 13th September, 1975.
L. J. Abbott (Australian Electoral Officer for Victoria conducting
election pursuant to the Conciliation and Arbitration Act 1904-
1974)". (at p301)

13. The following definition of irregularity appears in s. 4 (1) of the Act: "'Irregularity', in relation to an election or ballot, includes a breach of the rules of an organization or of a branch of an organization, and any act, omission or other means whereby the full and free recording of votes by all persons entitled to record votes, and by no other persons, or a correct ascertainment or declaration of the results of the voting is, or is attempted to be, prevented or hindered". (at p301)

14. It is not apparent at first sight what irregularity did lurk in these notices. But it was explained that the members of the organization would be likely to draw from them the inference that the returning officer was intimating that he would reject any nomination of a member of less than five years' standing. This was said to follow from the terms of the notices and the appearance of r. 6 (d) (i) and r. 6A in the rule book and in the certified rules available from the industrial registrar. It was said that the natural inference to be drawn by the members was that the returning officer was referring to those rules including r. 6 (d) (i) and r. 6A and that he intended to treat r. 6 (d) (i) and r. 6A as valid. The contention was that as there were a large number of members of less than five years' standing it was possible or even probable that one or more of them may have wrongly concluded from the terms of the notices that they were not entitled to nominate, or that although so entitled the returning officer would reject their nominations, and accordingly an irregularity within the meaning of that term as used in Pt IX of the Act had occurred whereby the result of the election may have been affected. (at p302)

15. Had one of the members of less than five years' standing nominated and his nomination been rejected then there would have been an irregularity cf. Leveridge's case [1977] FCA 9; (1977) 31 FLR 385 . But if the intimation of the returning officer was understood by members in the manner set out above, it was because they treated it as containing an intimation that the rules in the rule book would be enforced, because the returning officer was saying that it was his view that they were valid rules of the organization. He could not be understood as saying that he was going to enforce those rules whether they were valid or invalid. (at p302)

16. In view of the provisions of s. 140 (1), it would be a wise and knowledgeable person who with respect to various particular rules appearing in the rule book or the certified rules filed with the industrial registrar, could conclude with certainty with reference to any particular time whether those rules were valid. In the absence of a declaration by the court, those who operate the rules must act on their own view as to the validity and meaning of the rules on which they rely. In Krantz v. Maynes (1967) 10 FLR 134 the Commonwealth Industrial Court stated unequivocally that the certification of rules by the industrial registrar pursuant to s. 157 of the Act and even the consent of the registrar to rule changes pursuant to s. 139 did not preclude the court from investigating the validity of the rules. The court then said: "In this case the respondents for whom Mr. McHugh appeared seek to ascribe authenticity to rules which are not even the subject of a certificate under s. 157. It is said that there must be an authentic set of rules available to the public and that the filed rules are the only ones available and therefore further enquiry by this Court as to the validity of the filed rules should be declined. But, inconvenient as it may be, a member of the public would have no warrant for regarding such filed rules as authentic. He would know that even if he requested the Registrar to certify as to the rules of an organization the Registrar could give him only a certificate of prima facie value. (at p303)

17. No valid contention can rest therefore on the notion that the filed rules are or ought to be regarded as being necessarily the valid rules of an organization" (1967) 10 FLR, at pp 146, 147 . (at p303)

18. Except in special cases (e.g. s. 170) the returning officer must conduct an election according to the rules of the organization and this means the valid rules. When this returning officer announced that nominations must be in accordance with the rules of the organization, he was to be understood as referring to the rules of the organization whatever they might be and to the valid rules of the organization. No doubt he would have his own views as to what rules were valid and how those rules which he considered valid should be interpreted. But the ultimate question of the validity of any particular rule would not depend on his views. It was for members who wished to nominate to decide for themselves whether in accordance with the valid rules they were entitled to do so and if they so decided to lodge their nominations accordingly. At that stage the returning officer would have to accept or reject the nominations. He would have to do this according to his view as to the content of the valid rules. Members might form their own opinion as to what rules the returning officer would regard as valid but they could not reasonably act on the basis that his view was conclusive. Most of them no doubt would consider that the rules were in the rule book. In this they may in any case be in error and in this case would have been in in error. In this case the returning officer may himself have been in error. If the returning officer enforced a rule which was invalid and thereby rejected a nomination, there would be an irregularity which could be put right by the court as was done in Leveridge's case [1977] FCA 9; (1977) 31 FLR 385 . (at p303)

19. The terms of his notices calling for nomination leave all this open. They say the question will be decided according to the one and only criterion, namely, the rules of the organization, whatever they may be. Members of less than five years' standing may have refrained from nominating because they themselves believed r. 6 (d) (i) and r. 6A to be valid rules, or because, not having any belief of their own about the validity of the rules in question, they velieved that the returning officer considered that r. 6 (d) (i) and r. 6A were valid rules and would act accordingly, or because they believed r. 6 (d) (i) and r. 6A to be invalid rules but thought the returning officer believed them to be valid rules and would act accordingly, or because they were not interested in nominating. In the first case they refrained because they took an erroneous view of the rules. In the second they refrained because they were prepared to act on what they thought the returning officer thought. In the third they refrained because they failed to act according to the rules they believed to be valid rules. But in no case did they act on any statement by the returning officer which was not a perfectly correct summation of the situation, namely that the nominations should be in accordance with the rules of the organization. So to state was not and could not be an irregularity. The reference was and could only be to the rules of the organization actually in force, not to rules which the returning officer or any particular person might think to be in force. An irregularity could not result from the circumstance that members formed opinions as to the view that the returning officer might take as to the validity of any particular rule. Only if and when he acted by reference to the terms of what appeared in the rule book, and the certified rules, to be a rule and that "rule" happened to be invalid could it be contended that an irregularity of the kind alleged had occurred. It is an inevitable consequence of the provisions of s. 140 (1) that "rules" appearing in the rule book of an organization and as certified by the industrial registrar may be invalid by reason of circumstances arising at some particular time, perhaps outside the knowledge of the great majority of members, or of which, if within their knowledge they do not realize the significance. (at p304)

20. It may be that in some cases, this state of affairs will give rise to difficulties in the administration of registered organizations, but it is always open to test the validity of any rule upon which a returning officer may act. If there were any relevant misapprehensions relating to entitlement to nominate they resulted from the presence of invalid rules in the rule book and in the certified rules, after events with which the returning officer had no connexion had occurred and by reason of which they had become invalid. (at p304)

21. I am satisfied that no irregularity is disclosed in the conduct of the elections and accordingly the applications should in any event be dismissed. (at p304)

ORDER

Order accordingly.