Re Michael Patrick Jess v RJ Scott; JG Kidd; L Carmichael; G Campbell; RA Bruggy; W Martin; E Lipscombe; F Maurice; DA Beer; WR Arscott; P Mcgowan; RB Hawkes; G Harrison; RM Adamson; H Malcolm; P Johnson; JF Halfpenny; J O'Nei [1984] FCA 69 (30 March 1984)

FEDERAL COURT OF AUSTRALIA

Re: MICHAEL PATRICK JESS
And: R.J. SCOTT; J.G. KIDD; L. CARMICHAEL; G. CAMPBELL; R.A. BRUGGY; W.
MARTIN; E. LIPSCOMBE; F. MAURICE; D.A. BEER; W.R. ARSCOTT; P. McGOWAN; R.B.
HAWKES; G. HARRISON; R.M. ADAMSON; H. MALCOLM; P. JOHNSON; J.F. HALFPENNY; J.
O'NEILL; P. POINTER; M. TUMBERS; H. PEDEN; A.J. MARKS; B.R. BURNS; J.A.
VAUGHAN and M.K. HILL
No. 1 of 1984
Industrial Law
8 IR 269

COURT

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
INDUSTRIAL DIVISION
Beaumont J.

CATCHWORDS

Industrial law - Application under s.141 Conciliation & Arbitration Act - Electioneering material - Whether in breach of rules as application of union funds otherwise than in the interest of members of the Union as a whole.

Conciliation & Arbitration Act, 1904 s.141

Williams v. Hursey [1959] HCA 51; (1959) 103 C.L.R. 30

Short v. Wellings 72 C.A.R. 84

Kanan v. Hawkins 14 September, 1979, unreported per J.B. Sweeney, J.

Holmes v. Riordan 86 C.A.R. 180

Re Australian Postal and Telecommunications Union; Ex parte Wilson [1979] FCA 107; (1979) 28 A.L.R. 330

Valentine v. Butcher [1981] FCA 30; (1981) 51 F.L.R. 127

HEARING

SYDNEY
30:3:1984

ORDER

1. I make the orders sought in paras. 1, 2, 3 and 4 set out at pp. 2-3
et seq. of the reasons for judgment.

DECISION

For reasons given on 2 March 1984, it was held that the Court had jurisdiction to entertain the application for relief under s.141 of the Act. The matter has now proceeded to a final hearing. In the earlier judgment, reference is made to the nature of the relief then sought and to the identity of the parties. It is unnecessary to repeat that material, although it should be noted that, during the final hearing, the applicant indicated that he wished to refine his claim for relief to seek orders as follows:

"1. That the Respondents and each of them perform and observe the Rules of the AMALGAMATED METALS FOUNDRY & SHIPWRIGHTS UNION ('the Organisation') by refraining from publishing or distributing to members of the Organisation or causing to be so published or distributed out of the property, funds or resources of the Organisation any newspaper, newsletter, pamphlet or similar publication which supports or promotes or tends to support or promote or which seeks to defeat any person or group of persons who have informed the Organisation in writing that he or they intend to nominate in ballots for the following offices and positions in the Organisation:-

(a) National Secretary;

(b) National Organisers;

(c) State Secretary, Queensland Branch;

(d) Assistant Secretary, Tasmanian Branch;

(e) State Secretary, Western Australia Branch,

or which seeks to influence members of the Organisation in relation to voting in the said ballots.

2. That the Respondents and each of them perform and observe the Rules of the Organisation by refraining from using or permitting any person from using the Organisation's property, funds or resources to support or promote a candidate or group of candidates or to defeat any person or group of persons who have informed the Organisation in writing that he or they intend to nominate in ballots for the offices and positions referred to in order 1 or to influence voters voting or likely to vote in ballots for such offices.

3. From the date upon which nominations are called for the offices referred to in orders 1 and 2 above, the Respondents and each of them perform and observe the Rules of the AMALGAMATED METALS FOUNDRY & SHIPWRIGHTS UNION ('the Organisation') by refraining from publishing or distributing to members of the Organisation or causing to be so published or distributed out of the property funds or resources of the Organisation any newspaper, newsletter, pamphlet, or similar publication which supports or promotes or tends to support or promote any candidate or group of candidates nominating for such offices or which seeks or tends to defeat a candidate or group of candidates or which seeks or tends to influence voters voting or likely to vote in ballots for such offices.

4. That the Respondents and each of them perform and observe the Rules of the Organisation by refraining from using or permitting any person from using the Organisation's property, funds, or resources to support or promote a candidate or group of candidates or to defeat a candidate or group of candidates or to influence voters in the said ballots referred to in order 1.

5. Such further or other Orders as to the Court seems proper." (amendments emphasised)

There is no dispute about the primary facts of the case, although a question arises as to the use to which some of the documentary material tendered may be put. I will return to that question later.

The proceedings arose out of an election for several positions in the Union, in which ballots closed on 17 February 1984. However, the applicant still seeks permanent relief by way of orders under s.141, in respect of apprehended breaches of the rules of the Union in connection with elections to be held in the future: elections for the positions of national secretary, two national organizers, Queensland state secretary and assistant secretary, Tasmanian branch, will be held between May and August, 1984; it is expected that nominations for the position of national secretary will open early in May and close in early June, 1984; and under the rules of the Union, an election for the position of Western Australian branch secretary must be held prior to December 1984.

The applicant tendered documentary material published by the Union in recent months to show, he claimed, the abuse of the powers vested by the rules of the Union in the respondents in the manner indicated in the earlier reasons for judgment. The Union publications concerned consisted of a number of issues of first, "The Metalworker", a monthly publication (for the months of January/February 1982; March 1982; May 1982; July 1982; August 1982; November 1982; February 1983; June 1983; July 1983; November 1983; February and March 1984; and a supplement to "The Metalworker" dealing with the Queensland Branch State Conference held in February 1984); secondly, a quarterly publication known as "The AMFSU Quarterly Journal" (for the periods July/September 1981; October/December 1981; January/March 1982; July/September 1982; January/March 1983); thirdly, a publication known as the Union's "National Newsletter" (for the months of December 1983 and January 1984); although not strictly a publication, the applicant also relies upon the distribution, at a conference held on 8 March 1984 of the Tasmanian State Branch, of a report of the state secretary dated 7 March 1984.

It is not appropriate that I reproduce or even attempt to summarise such a volume of material. But, in order to understand the applicant's claim, reference should be made to the text of some of the more recent publications.

The National Newsletter dated 5 December 1983 reads, so far as material as follows:

"Workers must have Unions they can rely on

LIES AND SLANDER ARE NOT LEADERSHIP

A campaign is being waged to denigrate the role of the AMFSU in the working out of the economic Accord between the Labour Government and the Unions.

Since Labor's victory in the March Election the focus of the Union's work has shifted from the purely industrial area to the political stage.

We are seeking to obtain by working with the Labor Government what, under the Fraser Government, we could achieve only by stopping work and walking out the gate.

AMFSU Officials played a big part in drawing up the Accord with leading ALP figures before the last Federal Election.

. . .

DESTRUCTIVE ELEMENTS

One would think that all members genuinely interested in getting the most from our Union's work would aim for the maximum possible unity in action. However it seems that a few are hell bent on trying to destroy our unity.

They spend all their time throwing muck at the Union's leadership.

Recent events have provided clues as to why they should do this.

As revealed in the June 1983 Metal Worker, a leading light in the Queensland Liberal Party has been touting for signatures on a petition against the Union leadership. This Liberal Leader - not a member of the AMFSU - said it was necessary to change our Union leadership in order to help the Hawke Government.

The former secretary of the right wing National Civic Council, Gerald Mercer, admitted the NCC spent $140,000 on AMFSU National Elections last year.

Mercer, speaking on ABC Radio on May 26th, said the money was spent in support of so-called 'reform group' candidates - candidates who didn't win even with this massive financial backing.

THE UNANSWERED QUESTION

Metal workers must ask why such enormous funds are available to forces trying to get rid of the Union's current dedicated and expert leadership."

Similar comments were made in an editorial written by the first respondent, the Union's National President, in "The Metalworker" dated November 1983.

The report of the State Secretary of the Tasmanian Branch dated 7 March 1984 reads, so far as material:

"ATTACKS ON THE UNION

At the last Conference I made reference in my report to the attacks on the Union. The same people who were responsible for the attacks on the Union at the time of my last report are still continuing those attacks and indeed were successful in Tasmania to the extent that they secured the position of State Secretary and two State Delegates to the National Conference.

They have also secured a position of National Organiser, they were unsuccessful in other states where they have tried to win positions of full-time officials and state delegates to National Conference.

With reference to their success in Tasmania, this was brought about partly as a result of the finances the so called Reform Group has been able to obtain from sources outside of the Union.

How many members who voted in the election would be aware that the Reform Group has the backing of the National Civic Council, who have an unenviable record of interference in the affairs of Trade Unions throughout Australia.

That interference in Tasmania went to the extent that the publications put out by the Reform Group in support of its team contained statements not made by the candidates but dependant on half truths and inuendo to make up for the lack of union policy and activity of the candidates.

Finally delegates should be aware that the so called Reform Group have already indicated that they intend to oppose Bro. Finn as Assistant State Secretary."

Similar comments were made by the Queensland state secretary in address to the 1984 State Conference held on 16 and 17 February 1984.

Earlier editions of the Union publications which were tendered also took up the theme which emerged from the passages quoted above. For example, "The Metalworker" for the month of June 1983 contained an article in these terms:

"LIBERALS' BID FOR CONTROL OF AMFSU

Senior members of the Queensland Liberal Party are waging a dirty tricks campaign against the AMFSU.

They are part of a national network of outsiders attempting to seize control of the union.

Prominent in the campaign in Queensland is the chairman of the Capricornia district of the Liberal Party, businessman Norman Byrne.

Byrne, a former motor company manager, is asking metalworkers in Rockhampton to sign a petition asking the Industrial Registrar to stop AMFSU returning officers holding elections for 10 positions.

These elections are due in the next few months.

Byrne is not an AMFSU member.

OUTSIDERS

In the central Queensland town of Biloela three businessmen are seeking signatures for the same petition. They also are not AMFSU members.

Norman Byrne has a long history of opposition to trade unionism, and is connected with the extreme right-wing National Civic Council.

In September 1972 Byrne organised a dinner for NCC leader B.A. Santamaria in Rockhampton. A photograph of Byrne welcoming Santamaria to the city appeared in the Rockhampton Morning Bulletin.

Santamaria has admitted the NCC funded 'Reform Group' candidates led by Rod Kelly in AMFSU national elections last year.

Byrne, the Liberals and the NCC are now supporting those masquerading as the 'AMFSU Democratic Rank and File Committee' for the purposes of the forthcoming State elections.

The elections are for the State Presidency, held by Brian Burns, and nine National Conference delegateships.

The 'Democratic Rank and File Committee' claims the elections will be undemocratic and confined to members attending branch meetings if conducted by the union's returning officers.

This is a lie.

Under union rules, these elections would be by a full and secret postal ballot of all union members eligible to vote.

The ballot would not be held in the branches as claimed by the 'Democratic Rank and File Committee'. So much for their knowledge of the union's rules.

Campaign Literature from the 'Democratic Rank and File Committee' is a mixture of lies, innuendo and slander]

Its theme is that the AMFSU leadership is somehow a threat to the federal Labor government. Union leaders, according to Norman Byrne and Co, aim at 'stirring dissension and destroying the kind of harmony and concilation which the Hawke government is endeavouring to develop'.

Metalworkers will be touched to learn that the Liberal Party and people like Norman Byrne have had a change of heart and now support Bob Hawke and the ALP.

The AMFSU and its leadership showed their support for the ALP by donating $50,000 to Labor campaign funds. Bob Hawke collected the cheque in person at a meeting of AMFSU National Council shortly before the election.

Bob Hawke said then that the AMFSU should be congratulated for giving a lead to the rest of the trade union movement in negotiations with the ALP over the economic policy Accord.

He said: 'I applaud the remarkably constructive way in which this union has operated.'

He added: 'If this union had not adopted such an approach on a prices and incomes policy it is very unlikely the ALP would be going into an election with the confidence we have.'"

The applicant accepts that the objects of the Union include an object "generally to promote the welfare of the members of the union . . . The furtherance of political objects as provided by these rules" (Rule 3) and that the "political" objects includes the expenditures of money "by payment of affiliation and sustentation fees to the Australian Labour Party" and "by taking an active interest in the selection of political candidates endorsed by the Australian Labour Party, and by supporting their candidature when selected" (see Rule 20(1)(c) and (d) and see Williams v. Hursey [1959] HCA 51; (1959) 103 C.L.R. 30). But he contends that nothing in these rules or in the reasoning in Williams v. Hursey is inconsistent with the implication in the relevant rules that the powers of management and the like vested in union officers by the rules must be exercised bona fide for the benefit and in the interests of union members as a whole. The applicant then says that, whilst he does not seek to inhibit in any way electioneering on the part of any other person, the Court should intervene to prevent the application of the resources of the Union for the purpose of promoting electioneering by one faction of the Union against another faction: "The funds and resources of the organization belong as much to (the applicant) and (his) supporters as to (his) opponents and theirs" (Short v. Wellings 72 C.A.R. 84 at p.87; Kanan v. Hawkins, 14 September 1979, unreported, per J.B. Sweeney, J. at p.3).

On the other hand, on behalf of the respondents, it was submitted that the conduct now sought to be impugned was, in truth, in the interests of the Union as a whole or at the least, the union officials were bona fide of the opinion that it was so and this view was reasonably held. It was further submitted that the matters canvassed in the publications relied upon were properly the subject of comment by the respondents as raising questions of genuine public concern or, at least, genuine concern for the interests of the Union.

The respondents placed considerable reliance upon the decision of Dunphy, J. in Holmes v. Riordan 86 C.A.R. 180. It was there decided that the management of the union concerned were justified in publishing in its official organ material rebutting certain allegations made against the union during the course of a ballot, Dunphy, J. said (at p.197):

"In these circumstances, I consider that the special issue of 'The Clerk' or some other official union publication was not only justified but necessary. If the law were to be that attacks on a union or its management could not be answered if such attacks were made during the course of an election campaign, then irreparable harm might be done not so much to the members of a union executive but to the organization as such. It is just a matter as to the terms in which the reply was couched. Counsel for the applicant drew my attention to a number of statements in the special issue which, so he argued, went beyond the limits to which any justifiable reply should have gone. He argued that a number of excerpts were not genuinely directed towards answering that portion of the provocative pamphlet which I have indicated as being, in my opinion, rightfully the subject of a reply.

The special issue is a single page document printed on both sides and, in the main, its contents amount to a legitimate answer to the statement that the Union was bankrupt. However, it does undoubtedly go beyond the bounds in two instances only. Having devoted the best part of the two pages to what is plainly an answer which the Union management was entitled to make at any time, it extends into the realms of election propaganda in two paragraphs. In the first paragraph it makes a personal attack on the authors of the pamphlet and the last paragraph is a peroration which suggests that unionists should vote for what I have called the 'sitting members'. On a mathematical basis, approximately two inches of print out of a total of twenty-four inches have been devoted to matters which are clearly intended to influence voters and as this special issue was forwarded to all members of the union I do not doubt it would have had quite a substantial effect on the mind of the electors."

(See also Re Australian Postal and Telecommunications Union; Ex parte Wilson [1979] FCA 107; (1979) 28 A.L.R. 330 at p.335; Valentine v. Butcher [1981] FCA 30; (1981) 51 F.L.R. 127 at pp.136-142).

As has been said, the issue in the proceeding is whether the powers in question have been abused by the application of Union resources for the advancement of one sectional interest only rather than in the interests of members as a whole. This in turn involves a question of fact which falls to be determined on the documentary material tendered by the applicant. It was submitted on behalf of the respondent that the publications tendered were admissible as evidence not only of the fact of publication in each case but also of the truth of the facts therein alleged. The applicant, on the other hand, contends that the publications are admissible for the former, limited purpose only (see Hughes v. National Trustees, Executors & Agency Co. of Australia Ltd. [1979] HCA 2; (1979) 143 C.L.R. 134 at p.153, Jones v. Sutherland Shire Council (1979) 2 N.S.W. L.R. 206 at pp.214 et seq.). However, since the respondents called no evidence with a view to establishing the truth of the matters asserted in the publications, it is unnecessary to determine this question: even if, technically, the material is admissible for the wider purpose contended for by the respondents, I would be disposed to give it very little, if any, weight, in their absence from the witness box.

It may be accepted that the respondents genuinely believe that the best interests of the Unions will be served if steps can be taken to ensure that those candidates who are perceived to have views and interests which are hostile to the respondents are unsuccessful in seeking office at Union elections. To hold that belief, and indeed, to publish it, involves no breach of the rules or of any implication based on the rules. But, to publish those opinions at the expense of the Union in the context of an election for offices in the Union with a view to influencing the outcome of the election in favour of a particular candidate or candidates does, as has been said, involve such a breach. In my opinion, the conduct of the respondents should be so characterised: there can be doubt that the material has been published with the object of advancing the prospects of one group of candidates at the expense of the opposing faction, however beneficial such a result may be thought to be. In this connection, in my view, the primary purpose sought to be achieved is an election result, rather than the defence of an attack upon the Union in the sense discussed in Holmes v. Riordan.

It is true that not all the elections concerned are imminent. However, all are due within the foreseeable future. It is also true that it may be said that relief is sought on a quia timet basis, in the sense that the elections will extend over a considerable period into the future. But, in my opinion, the theme complained of is now so well entrenched in the Union publications that there is every reason to expect that, unless restrained, the pattern of conduct will continue into the future.

Further, in my view, no discretionary ground exists for refusing relief under s.141.

I propose to grant the relief sought. I make the orders sought in paras. 1, 2, 3, and 4 set out at pp. 2-3 et seq. of these reasons.