Re William Patrick Ludwig v the Australian Workers' Union [1990] FCA 15; 32 IR 254 (1 February 1990)

FEDERAL COURT OF AUSTRALIA

Re: WILLIAM PATRICK LUDWIG
And: THE AUSTRALIAN WORKERS' UNION
No. Q I2 of 1990
FED No. 47
Industrial Law
32 IR 254

COURT

IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
INDUSTRIAL DIVISION
Spender J.(1)

CATCHWORDS

Industrial Law - organisation of employees registered under Industrial Relations Act 1988 - construction of rules - term of office of Branch Executive Councillors - appropriateness of as respondent in proceedings for observance of rules.

Industrial Relations Act 1988 (Cth.), s. 209

HEARING

BRISBANE
1:2:1990

Counsel for applicant: Mr. R.I. Hanger QC and

Ms. M. Wilson
instructed by: Thompson King & Partners

Counsel for respondent: Mr. J. Murdoch
instructed by: McInnes Wilson & Jensen, town
agents for Turner Freeman,
Sydney.

ORDER

The rule nisi be discharged with no order as to costs.

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

DECISION

The central question in these proceedings is whether Branch Executive Councillors elected to the Executive Council of the Australian Workers' Union in elections held in December 1985 hold office until 1 June 1990 or no later than 1 February 1990.

2. The method by which this question is agitated needs some consideration. By an application which was filed on 30 January 1990, Mr. Ludwig, who was elected to the presidency of the Australian Workers' Union in elections in December 1989, sought an order pursuant to s. 209 of the Industrial Relations Act 1988 ("the Act"), directing the respondent union to take all necessary steps to allow members of the Executive Council of the respondent elected in December 1989 to assume their positions no later than 1 February 1990. In the alternative, other declarations were sought.

3. Order 4 r. 15 of the Federal Court Rules, which is concerned with the commencement of proceedings, provides by sub-rule (1) that:-

"This rule shall operate only for so long as
paragraph 342(2)(a) of the Industrial Relations
Act 1988 specifies the making of a rule as a
condition precedent to the grant of financial
assistance."

Sub-rule (2) provides:-

"A proceeding under sections 208 or 209 of the
Industrial Relations Act 1988 shall be by rule in
accordance with Form 6 calling upon the person or
organization concerned to show cause why the order
should not be made."

4. It is to be noted that the rule refers to "the person or organisation".

5. When this matter was called on for hearing this morning, an application was made by Mr. Hanger QC, senior counsel for the applicant, for leave to seek a rule, in Form 6, that The Australian Workers' Union appear before the Federal Court to show cause why an order should not be made under s. 209 of the Act directing that it take all necessary steps to allow members of the Executive Council elected by elections of the respondent in December 1989 to assume their positions no later than 1 February 1990. Alternatively, a declaration was sought that, if the rules precluded the assumption of positions on 1 February, then they impose a restriction that was oppressive, unreasonable or unjust. There were further alternative declarations sought.

6. A notice of motion was filed on behalf of the respondent union seeking that the application be struck out and the applicant be ordered to pay the respondent's costs. This was directed principally towards the nature of the application as it was originally filed in the Court. However, it was further submitted in support of that motion that the Australian Workers' Union was not a proper respondent to the application for the proposed show cause rule.

7. Section 209 of the Industrial Relations Act 1988 provides:-

"(1) A member of an organisation may apply to the
Court for an order under this section in relation
to the organisation.
(2) Before making an order under this section, the
Court shall give any person against whom the order
is sought an opportunity of being heard."
(my emphasis)

It was suggested that, in the circumstances and having regard to the nature of the relief sought, the organisation was not the appropriate respondent.

8. In that regard, reference may usefully be made to the observations in Australian Workers' Union v. Bowen (No.2) [1948] HCA 35; (1948) 77 CLR 601 at 633, where Williams J. said:-

"Section 58E of the Commonwealth Conciliation and
Arbitration Act confers upon the Commonwealth
Court of Conciliation and Arbitration complete
power to supervise the observance and to enforce
the performance of any rules of an organization by
any person who is under an obligation to perform
or observe those rules. I see no reason why the
word 'person' in the section should be confined to
natural persons and should not be given the
meaning attributed to it by s. 22(a) of the Acts
Interpretation Act 1901-1941. In my opinion the
word includes a body corporate. Accordingly it
confers power on that court to order an
organization and its responsible officials to
recognize as members persons who have been
invalidly expelled from membership and who are
therefore in law still members of the
organization. But it does not confer power on the
court to exercise its own discretion as to the
manner in which the powers and duties conferred by
the rules on the officials of an organization
should be exercised."

9. That it is competent pursuant to the sub-section for an organization registered under the Act to be a proper respondent is made clear by sub-rule (2) of r. 15 of Order 4 of the Federal Court Rules. It is undoubted that the organisation per se would have a clear interest in maintaining the validity of rules subject to challenge. As to whether it is an appropriate party in the present circumstances, however, is a moot point. Nonetheless, it seems to me unnecessary to decide that particular question. My view is, whoever be the appropriate respondents to the rule to show cause, I ought to grant the application for a rule nisi directed to determining the appropriate tenure, according to the rules, of those councillors elected to the Branch Executive Council in the elections held in December 1985. But for the reasons which follow, I would discharge the rule.

10. In my view, on the proper interpretation of the rules that are applicable, the terms of the Branch Executive Councillors elected in December 1985 expire immediately prior to 1 June 1990.

11. The issues raised by the applicant, other than that immediately concerned with the question of the tenure of the Branch Executive councillors, included a challenge to the powers of the Executive Council to suspend policy resolutions made by a union convention held in January of this year. After the difficulties in the formulation of the relief sought by the applicant in this regard and in identifying the persons against whom such relief was sought were aired and remained unresolved, it was accepted on behalf of the applicant by his senior counsel that those issues might more conveniently and appropriately be resolved by a separate application for a rule nisi.

12. Presently then, I am concerned only with the question of whether the terms of office of those Branch Executive Councillors elected in December 1985 expire at the end of January or at the end of May 1990.

13. It is necessary in that respect to have regard to a considerable number of the rules of the respondent union, the various amendments made to them over time and, in particular, the rules that were in effect at the time of the elections in December 1989.

14. The parties are agreed that the election of members for the Federal Executive has historically been as follows:-

Dec. 1964 for a 3 year term
Dec. 1967 for a 5 year term
Dec. 1972 for a 5 year term
Dec. 1977 for a 4 year term
Dec. 1981 for a 4 year term
Dec. 1985 for a 4 year term
Dec. 1989 for a 4 year term

In relation to those elections, some reference should be made to the constitution of the Executive Council and the rules relating thereto at various points in the history of the union. In 1965-66, rule 32 of The Australian Workers' Union provided, in its second paragraph, that:-

"Subject to removal as provided in these Rules, the
President, Vice-Presidents, General Secretary and
Branch Councillors shall hold office for three years..."

In the rules as promulgated in 1966-67, r. 36 relevantly provided:-

"Subject to removal as provided in these Rules, the
President, Vice-Presidents, General Secretary and
Branch Councillors shall hold office for five
years (the alteration to the term of office for
the President, Vice-Presidents and General
Secretary to take effect as from 1st February,
1968, and in the case of Branch Councillors from
1st June, 1968)..."

The relevant rule remained substantially in those terms until 1977-78, when r. 36 relevantly provided :-

"Subject to removal as provided in these Rules, the
President, Vice-Presidents, General Secretary and
Branch Councillors shall hold office for four
years (the alteration to the term of office for
the President, Vice-Presidents and General
Secretary to take effect as from 1st February,
1978, and in the case of Branch Councillors from
1st June, 1978)..."

15. In the rules in 1985-86, which applied to elections held in December 1985, r. 36 relevantly provided that:-

"Subject to removal as provided in these Rules, the
President, Vice-Presidents, General Secretary and
Branch Councillors shall hold office for four
years (the alteration to the term of office for
the President, Vice-Presidents and General
Secretary to take effect as from 1st February,
1978, and in the case of Branch Councillors from
1st June, 1978)..."

16. Subsequently, the rules were amended so as to provide in r. 34 in the same context:-

"Subject to removal as provided in these Rules, the
President, Vice-Presidents, General Secretary and
Branch Councillors shall hold office for four years..."

That rule also provides in its first paragraph:-

"There shall be elected in the manner hereinafter
appearing an Executive Council consisting of a
President, one Vice-President from each Branch, a
General Secretary, and Assistant General Secretary
(all of whom shall be Executive Officers of the
Union) and one Councillor from each Branch."

17. It is to be noted that there is a distinction drawn between the Executive Officers of the union, being the President, Vice-President from each Branch, General Secretary and Assistant General Secretary on the one hand, and the Councillors from each Branch on the other. Members of the latter group are not Executive Officers of the union. It should also be noted that Councillors from each Branch are, generally speaking, dealt with in the rules as particular officers of the relevant Branch they represent. Rule 34 itself provides, inter alia:-

"Branch Councillors shall be elected by each Branch
in accordance with the Rules, and may be removed
by a plebiscite of the members of the Branch."

18. The submission on behalf of the applicant was that r. 36 of the rules which applied in December 1985 to govern the election of those now outgoing Branch Executive Councillors whose tenure is under question, did not have the consequence of providing that those Branch Councillors took office from 1 June 1986 until 1 June 1990. Rather, the applicant submitted that the words of the rule in parenthesis did no more than indicate that the alteration in the terms of the rule took effect no earlier than the nominated dates.

19. The fact of the matter, however, is that all members of the union have proceeded on the basis that the term for Branch Councillors ran from 1 June in the year immediately following their election and lasted for four years. That was the position for those elected in the 1977 and 1981 elections. Notwithstanding that fact, the applicant submits that everyone in the union was mistaken for a considerable number of years. The applicant argued that the true position is either that those Councillors' term of office commenced from the declaration of the poll, there being nothing in the rules to indicate when their terms of office otherwise might commence or, alternatively, relying on a provision in r. 38, that the terms of those Councillors commence on 1 February 1990.

20. In my opinion, there has been no error in the accepted interpretation of the rules. In respect of the President, Vice-Presidents, General Secretary and Branch Councillors, the term of office is four years, but in the situation of the President, Vice-Presidents and General Secretary, the term commences on 1 February. However, in the case of Branch Councillors, the term commences on 1 June.

21. In reaching that conclusion, regard has to be made to a number of the rules of the union.

22. Rule 3 provides:-

"...the General Secretary ... shall be empowered to
act on behalf of the Union and to sue and be sued
under those Acts and to bring or defend or cause
to be brought or defended any action, suit,
proceeding, prosecution or complaint in any Court
of Law or Equity."

23. A question arose as to the competence of counsel to appear on behalf of the respondent union in these proceedings. However, it seems to me that r. 3 has a direct relevance to this question, and Mr. Hodder, as General Secretary, is empowered by r. 3 to give instructions on behalf of the union in these proceedings.

24. Rule 30 provides:-

"The Convention shall be held annually and shall
commence no later than 14th February each year
except in the calendar year immediately following
each ordinary election of Executive Officers when
the Convention shall commence no later than 31
January and shall be constituted as follows:
(a) The President, General Secretary and
Assistant General Secretary of the Union...
(b) Delegates elected by the various Branches.
..."

25. Rule 31 deals with the powers of the convention and provides, inter alia:-

"The Convention shall be the highest deliberative
body of the Union and shall have power:
(a) To decide and direct the policy of the Union
in matters affecting the interests of the
members in all industrial, political and
municipal concerns.
(b) to make, amend or rescind Rules and to hear
any appeal from a decision of the Executive
Council or Branch Executive.
..."

26. Rule 34 relevantly provides:-

"There shall be elected in the manner hereinafter
appearing an Executive Council consisting of a
President, one Vice-President from each Branch, a
General Secretary, and Assistant General Secretary
(all of whom shall be Executive Officers of the
Union) and one Councillor from each Branch.
Subject to removal as provided in the Rules, the
President, Vice-Presidents, General Secretary,
Assistant General Secretary and Branch Councillors
shall hold office for four years,...
...
Branch Councillors shall be elected by each Branch
in accordance with the Rules, and may be removed
by a plebiscite of the members of the Branch."

27. Rule 36 relevantly provides for the powers and duty of the Executive Council. Sub-rule (b) of that rule provides:-

"The Executive Council, when Convention is not
sitting, shall have power:
(1) to suspend the policy laid down by
Convention or any portion thereof;
(2) to make such rules and other provisions or
to rescind or vary existing Rules;
(3) to impose levies upon members and Branches;
..."

28. There is a proviso to that sub-rule which reads:-

"Provided that all acts done by virtue of
paragraphs 1, 2 and 3 of this section (b) must be
affirmed by no less than two thirds of the total
number of votes allocated to members of the
Executive Council or it shall have no effect."

29. Rule 38 deals with the powers and duties of President, Vice-Presidents, Assistant General Secretary and General Secretary. To be noted in r. 38 is the provision:-

"In the event of the President or General Secretary
or Assistant General Secretary then holding office
not being nominated or being defeated in the
ballot for the next ensuing term of office, they
shall attend and open the next ensuing Annual
Convention and retain their positions until the
1st February, after which the new officers shall
be installed in their respective offices. The
annual report and balance sheets shall be
submitted and debated or otherwise at Convention
prior to the 1st February."

30. It was submitted on behalf of the applicant that the reference to "the new officers" includes not only officers elected to the positions of President, General Secretary or Assistant General Secretary, but to all members of the Executive Council. I do not accept this submission, for it seems to me in the context of the rule that the reference to "new officers" refers to the persons who are to replace the President, General Secretary and Assistant General Secretary. The reference in my opinion does not extend to Branch Executive Councillors.

31. Rule 71 deals with the election of Executive Officers. So far as the President, General Secretary and Assistant General Secretary are concerned, sub-rule 71(a)(i) provides:-

"In the event of there being more candidates than
are required to fill the office of President or
General Secretary or Assistant General Secretary,
an election shall take place by ballot of the
whole membership of the Union every four years at
the same time and place and in the same manner as
the ballots for the election of Branch Officers."

32. So far as Vice-Presidents are concerned, sub-rule 71(c) provides:

"Persons elected to office for the positions of
President, Vice-Presidents and General Secretary
at the General Elections in 1985 shall hold that
position for the period of time as elected in
accordance with the Rules of the Union at the time
the elections were held in 1985.
At the next General Elections to be held in 1989
for all of the above positions those persons
elected to office shall hold such office until the
1st February 1994 and thereafter persons elected
at General Elections shall hold such office for a
four year period commencing at the 1st February in
the year in which the elected person takes
office."

33. Rule 72 deals with election of Executive Councillors and sub-rule (c) provides:-

"The nomination and election of Branch Councillors
shall be conducted in the same manner as provided
in the Rules for the election of Branch Officers."

34. Rule 74 is crucial to the determination of these proceedings. It deals with Branch nominations. The second paragraph of that rule provides:-

"Persons elected to office for the positions of
Branch President, Branch Vice-Presidents, Branch
Secretary, Branch Executive Councillor, District
Secretaries, the President and the Secretary of
the Mining Division of the West Australian Branch,
Organisers, District Representatives and Branch
Executive Committeemen at the General Elections in
1985 shall hold that position for the period of
time as elected in accordance with the Rules of
the Union at the time the elections were held in 1985."

I note that each of the positions there mentioned are Branch positions and are said to be elected for the period of time in accordance with the Rules of the Union at the time the elections were held in 1985. The rules covering the elections in 1985 provided for a four-year term. The next paragraph of r. 74 provides:-

"At the next General Elections to be held in 1989
for all of the above positions those persons
elected to office shall hold such office until the
1st February 1994 and thereafter persons elected
at General Elections shall hold such office for a
four year period commencing at the 1st February in
the year in which the elected person takes office."

35. It is plain that the rule provides that Branch Executive Councillors elected in 1985 are to hold office for a four-year term, as provided by the rules that were then applicable. A specific provision is then made for those persons elected to office in the elections in December 1989. The effect of that provision is that their office is to expire on 1 February 1994 and that, subsequent to that period, persons elected to the relevant offices will serve a four year term commencing on 1 February in the year immediately following their election, and continuing until 1 February four years thence.

36. The fact that prior to the application of these rules there was a lack of synchronisation in the terms of office of the Executive Officers of the union, as that phrase is explained in r. 34, and the terms of office of Branch Executive Councillors does not affect the conclusions to which I have come. The plain intent of r. 74 is to bring into synchronisation the terms of office of Branch Officers and the terms of office of Executive Officers of the union. That is to be done, in my opinion, not by shortening the four-year term of office to which Branch Executive Councillors were elected in December 1985, but rather by providing for the terms of office of those persons, inter alios, elected as Branch Executive Councillors in December 1989 to conclude on 1 February 1994. That is to say, for those particular persons, their term of office will be shorter than four years, since it will commence on 1 June 1990 and continue until 1 February 1994. The thrust of the change is indicated by the words "thereafter persons elected at General Elections shall hold such office for a four year period commencing at the 1st February in the year in which the elected person takes office."

37. That the rule should operate in that prospective way seems to me to accord with notions of fairness and also with observations made in Higgins v. McGrane (1961) 5 FLR 82 and in Beetson v. Blainey (1966) 8 FLR 292.

38. It was submitted by senior counsel for the applicant that the rules of the union did not provide the date on which the terms of office of Federal Executive officers of the union should commence. In those circumstances, the common law position would hold, which was that elected persons would take office from the date of the declaration of the poll. Reliance was placed on the observations by the Full Court of the Federal Court in Re Federated Clerks Union of Aust.; Re Callaghan (1983) 6 IR 258 at 262, where Northrop and Lockhart JJ. said:-

"In the present case, the votes recorded on the
ballot papers for the election of federal
councillors from the C. & S.Q. branch had to be
counted. For the purposes of the federal rules and
the branch rules, the relevant time is the
declaration of the ballot, since that is the time
when it is first ascertained who will be the
federal councillors for the following two years.
That is the time when the term of office of the
previous holder ceases."

39. In my opinion, the Rules of the Australian Workers' Union provide for the commencement of the term of the relevant office holders and that the general rule as indicated in that case has no present application.

40. While arguments of convenience may be seductive, it is not irrelevant to note the construction of the rules which I have favoured accords with the longstanding view of every office holder in the union. It has been the basis on which paid union officials have taken office and arranged their affairs in the anticipation that their tenure would continue until 1 June four years after their election. That gross inconvenience is avoided by the construction I have placed on the rules does not mean that interpretation is necessarily correct. Nonetheless, it is comforting.

41. As earlier indicated, the reference to "new officers" in r. 38 does not include Branch Executive Councillors. It also is my view that the effect of r. 74 is to recognize that Branch Executive Councillors elected prior to those who will take up their position after the 1989 elections will continue in office up until 1 June 1990. Those persons elected in the December 1989 elections will assume office as Branch Councillors on 1 June 1990 and continue in office until 1 February 1994. In these circumstances, I would have granted a rule nisi to permit this matter to be the subject of argument. It is proper for me now to grant leave to the applicant for an order to show cause directed to the respondent union in terms of that handed to me this morning. Nonetheless, for the reasons I have just given, I will discharge that order.

42. It seems to me that the provisions of s. 209(2) of the Act and O. 4 r. 15(2) of the Federal Court Rules require that a rule calling on the person or organisation "concerned" to show cause why the order should not be made, should be directed to all persons who would be affected by the making of such an order. It would not extend simply to those Federal Councillors whose tenure is directly in issue, but also to those Branch Officials, including organisers, who on the interpretation contended for by the applicant, would, contrary to general expectation, have had their term of office expire on 1 February rather than 1 June 1990. It seems to me that those persons also would have to be given the opportunity to be heard.

43. On the question of costs, notwithstanding the technical defects to which reference has been made, this issue was one of importance. The proceedings are not of the kind referred to in s. 347 of the Act.

44. In those circumstances the orders I make are that the rule nisi be discharged. I make no order as to costs.