Re Industrial Relations Act 1988 v Re An Application By Steven Patrick Post of An Inquiry Into the Election of Offices In the Transport Workers Union of Australia, Western Australian Branch [1992] FCA 15 (31 January 1992)

FEDERAL COURT OF AUSTRALIA

Re: IN THE MATTER OF THE INDUSTRIAL RELATIONS ACT 1988
And: IN THE MATTER OF AN APPLICATION BY STEVEN PATRICK POST FOR AN INQUIRY
INTO THE ELECTION FOR OFFICES IN THE TRANSPORT WORKERS UNION OF AUSTRALIA,
WESTERN AUSTRALIAN BRANCH
No. WA I1 of 1992
FED No. 11
Industrial Law
(1992)40 IR 162

COURT

IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
INDUSTRIAL DIVISION
French J.(1)

CATCHWORDS

Industrial Law - elections - application for inquiry - whether reasonable ground for application - validity of rules - reliance upon invalid rule as constituting irregularity - whether reasonable ground for contention that rule imposing financial qualifications oppressive, unjust or unreasonable - alleged unlawful use of Union funds to support incumbent candidate and others - whether irregularity in relation to an election - sufficiency of facts to support ground that rejected nominee was financial - application dismissed.

Industrial Relations Act 1988 ss.218, 219, 223, 196

Conciliation and Arbitration Act 1904

Gordon v Hospital Employees' Federation of Australia (1975) 27 FLR 129

Lovell v Federated Liquor and Allied Industries Employees' Union of Australia (1978) 22 ALR 704

Leveridge v Shop Distributive and Allied Employees' Association (1977) 17 ALR 145

Allen v Townsend [1977] FCA 10; (1977) 16 ALR 301

Allen v Vehicle Builders Employees' Federation of Australia (1978) 22 ALR 510

Bucknall v Painting and Kindred Industries Union (1981) 52 FLR 258

Re Collins; Ex parte Hockings [1989] HCA 42; (1989) 167 CLR 522

Re Davidson (1990) 31 IR 102

HEARING

PERTH
31:1:1992

Counsel for the Applicant: Mr P. J. Gethin

Solicitors for the Applicant: Patrick J. Gethin

Counsel for the Branch President and Branch Secretary: Mr R. Le Miere

Solicitors for the Branch President and Branch Secretary: Dwyer Durack

ORDER

The application is dismissed.
Note: Settlement and entry of Orders is dealt with in Order 36 of the Federal Court Rules.

DECISION

Steven Patrick Post is a member of the Western Australian branch of the Transport Workers Union of Australia. He has nominated as a candidate for the office of Secretary in pending Branch elections but his nomination has been refused by the returning officer. By an application filed on 15 January 1992 under s.218 of the Industrial Relations Act 1988, he seeks an inquiry by the Court into irregularities which, he says, have occurred in relation to the election for a number of offices. The offices are those of Branch President, Vice President, Secretary, Trustees, Committee of Management, Branch Organisers and Federal Councillors. The election has not yet been held and the printing of ballot papers has, for the time being, been restrained by an order in another application on unrelated grounds brought by another party.

2. Section 219 of the Act has the effect that before the Court can embark upon an inquiry it must be satisfied that there is reasonable ground for the application. In this case that issue has been contested by counsel appearing for the present Branch President and Branch Secretary.
The Grounds for the Application

3. There are four irregularities alleged in the application. The first is that a substantial number of members of the Union in Western Australia has been wrongfully excluded from the electoral roll for the pending election. The second is the alleged unlawful use of Union resources to promote the candidacy of the incumbent Secretary and certain candidates for other offices. The third is that the returning officer wrongfully rejected Post's nomination as a candidate for the office of Secretary incorrectly alleging that he did not have three years continuous financial membership of the Union at the time of his nomination. The fourth irregularity is set up as an alternative to the third. Mr Post contends that if it be the case that he was not eligible for nomination as a candidate for the office of Branch Secretary, then the incumbent Secretary by unlawfully refusing him access to the financial records of his membership, caused him to nominate in ignorance of his true financial status. On the assumption that Mr Post was going to run for the office of Branch Secretary another person who would have nominated as a candidate for that office did not do so. The action of the incumbent Secretary in refusing access to Mr Post's financial records of his membership of the Union was allegedly in breach of the rules of the Union and a means by which the full and free recording of votes by all persons entitled to record votes was prevented or hindered or attempted to be prevented or hindered.
Facts Relied Upon

4. The application set out various facts relied upon to support the alleged irregularities. In relation to the exclusion of members from the electoral roll, Mr Post referred to arrangements between the Union and various employers under which contributions to the Union are collected by a pro-rata deduction from wages. Persons whose contributions are paid in this way are nevertheless excluded from the electoral roll upon the basis that they are unfinancial. This situation, according to Mr Post, arises because r.18 of the Union Rules provides, in effect, that subscriptions are to be paid annually on 1 January and not later than 28 February. Any member who fails to pay within that time, he says, is treated as unfinancial and by r.21 unfinancial members are debarred from all benefits, privileges or rights connected with the Union. Several hundred members of the Branch whose contributions are collected by deduction from their wages are said to be treated as unfinancial because their full subscription has not been paid by 28 February. Mr Post attacks r.18 when read in conjunction with r.21 as a rule contravening s.196 of the Act in that it imposes upon members of the Union in Western Australia restrictions which, having regard to the objects of the Act and the purpose of registration of organisations under the Act, are oppressive, unreasonable and unjust. In substance, the first irregularity depends upon the success of an attack upon the validity of the rule by which financial membership is defined.

5. The second alleged irregularity relating to the use of Union resources to support the candidacy of the incumbent Secretary relies upon the use of a mail franking machine owned and maintained by the Union to stamp envelopes which contain leaflets promoting the incumbent's candidacy.

6. As to the allegedly wrongful refusal of Mr Post's nomination, he points to the requirement of r.22 of the Union Rules that a candidate for the office of Secretary must have been a financial member continuously for the previous three years. Mr Post had paid his annual subscriptions by 28 February in each of the years 1990 and 1991 but had not paid his annual subscription for the year 1989 until 15 May. He contends, nevertheless, that he was financial even for the year on the basis that amounts which he had paid in previous years from 1975 to 1990 exceeded the lawful subscription. This depended upon an allegation that the Union had claimed from members during those years an amount which exceeded their subscription and did so without any lawful basis. In substance Mr Post seems to be saying that he had accumulated a credit by reason of these overpayments which meant he was already financial as at 28 February 1989 even though he did not pay the subscription demanded by the Union until 15 May in that year.

7. In relation to the alleged refusal by the Branch to grant him access to his financial records, this is the subject matter of proceedings in action number WAI 2 of 1991 which is listed for hearing in this Court next week. He maintains that the refusal by the Branch to grant him access to the records means he had no opportunity to ascertain his true financial status or that of other candidates. Subsequently he and others had to nominate in ignorance of their true financial status and if some at the time had been convinced that they were not eligible to nominate as candidates for office, other persons might have nominated in their place. He refers in particular to another candidate, Mr Laurie Humphreys, who would have become a candidate for the office of Branch Secretary if Mr Post had not nominated. The rejection of his nomination occurred after the close of nominations generally.
Statutory Framework

8. The provisions of the Industrial Relations Act 1988 relating to inquiries into elections contemplate an application for an inquiry and a threshold determination by the Court that there is reasonable ground for the application. This appears from ss.218 and 219:

"218. Where a person who is, or within the preceding
period of 12 months has been, a member of an
organisation claims that there has been an
irregularity in relation to an election for an office
in the organisation or a branch of the organisation,
the person may make an application for an inquiry by
the Court into the matter.
219. Where:
(a) an application for an inquiry has been
lodged with the Court under section 218;
and
(b) the Court is satisfied that there is
reasonable ground for the application;
the Court shall fix a time and place for conducting
the inquiry, and may give such directions as it
considers necessary to ensure that all persons who are
or may be justly entitled to appear at the inquiry are
notified of the time and place fixed and, where the
Court fixes a time and place, the inquiry shall be
taken to have been instituted."

9. The function of the Court in the conduct of an inquiry is dealt with in s.223:
"223(1) At an inquiry, the Court shall inquire into

and determine the question whether an irregularity has
happened in relation to the election, and such further
questions concerning the conduct and results of the
election as the Court considers necessary.
.
.
.
(3) If the Court finds that an irregularity has
happened, the Court may, subject to sub-section (4),
make one or more of the following orders:
(a) an order declaring the election, or any
step in relation to the election, to be void;
.
.
.
(c) an order directing the Industrial
Registrar to make arrangements:
(i) in the case of an
uncompleted election -
for a step in relation to
the election (including
the calling for
nominations) to be taken
again and for the
uncompleted steps in the
election to be taken;
.
.
.
(d) an order (including an order modifying the
operation of the rules of the organisation
to the extent necessary to enable a new
election to be held, a step in relation to
an election to be taken again or an
uncompleted step in an election to be
taken) incidental or supplementary to, or
consequential on, any other order under this section.
(4) The Court shall not declare an election, or
any step taken in relation to an election, to be void,
or declare that a person was not elected, unless the
Court is of the opinion that, having regard to the
irregularity found, and any circumstances giving rise
to a likelihood that similar irregularities may have
happened or may happen, the result of the election may
have been affected, or may be affected, by irregularities."

10. In light of the attack on r.18, reference should also be made to s.196 of the Act which provides:

"196. The rules of an organisation:
.
.
.
(c) shall not impose on applicants for
membership, or members, of the
organisation, conditions, obligations or
restrictions that, having regard to the
objects of this Act and the purposes of
the registration of organisations under
this Act, are oppressive, unreasonable or unjust."

11. The objects of the Act set out in s.3 include in para (g):

"To encourage the democratic control of organisations,
and the participation by their members in the affairs
of organisations."

Applications may be made under s.208 of the Act seeking a declaration that the whole or part of a rule of an organisation contravenes s.196. If such a declaration is made then, by virtue of s.208(5) the rule or part of the rule, as the case may be, shall be taken to be void from the date of the order.
Rules of the Union

12. The relevant provisions of the registered rules of the Union include the following:

"18 - CONTRIBUTIONS
(a) Each person who makes application for and
is granted membership on and after 1st
January 1982 shall for the first year (or
part thereof) of membership pay a
contribution for the fund of the Union as
follows:-
(i) During the first six
calendar months
(1st January - 30th June)
Yearly Contribution
(ii) During the second six
calendar months
(1st July - 31st December)
50% of Yearly Contribution
(b) A member shall pay the contributions as
defined in this Rule within fourteen days
from the date of making application for membership.
(c) Contributions in each subsequent year
shall be paid as follows:-
South Australia/Northern Territory - half
the amount not later than the 28th day of
February and the other half not later than
the 31st day of August.
Other Branches and in States and
Territories where no Branch is constituted
- the full amount shall become due and
payable on the 1st day of January and be
paid not later than the 28th February.
.
.
.
(e) Definition
The year for the purpose of this Rule
shall commence on the 1st day of January
and shall end on the 31st day of December each year.

Rule 20 provides for levies to be imposed upon Branches by the Federal Council and upon members by each Branch. Rule 21 deals with unfinancial members in the following terms:

"21 - UNFINANCIAL MEMBERS
Any member who fails to pay entrance fee,
contributions, fines or levies, as prescribed by these
Rules, shall be deemed to be unfinancial until all
such entrance fee, contributions, fines or levies have
been paid and ten days thereafter.
Unfinancial members shall be debarred from all
benefits, privileges or rights whatsoever connected
with the Union."

Rule 22 which covers eligibility for various offices is in the following terms:
"22(a)(I) That subject to Rule 63(14) in respect of

the New South Wales Branch a person shall not be
eligible to nominate for any office in the Union or
any Branch or Sub-Branch of the Union unless, at the
date of close of nominations for election to such
office he or she is:-
(i) a financial member of the Union, and
(ii) either is employed in the industry in
connexion with which the Union is
registered and in respect of such
employment is entitled to membership of
the Union pursuant to Rule 4, or is a
person holding office as Federal
Secretary, Federal Assistant Secretary,
Branch Secretary, Branch Industrial
Research Officer or Organiser (whether
elected or appointed) or as organiser
appointed by Federal Council or Federal
Committee of Management.
.
.
.
(b) Subject to para.(a) hereof a person is eligible
to hold the office of -
(i) Federal President;
Federal Vice-President;
Federal Secretary;
Federal Assistant Secretary; or
(ii) Branch President;
Branch Secretary;
Branch Industrial Research Office; or
(iii) Organiser (whether elected or appointed);
if he is a financial member of the Union continuously
for the previous three years and is financial at the
time of his nomination for election (or appointment as
the case may be) but not otherwise."

"Reasonable Ground for the Application"

13. The question for the Court mandated by s.219(b) of the Industrial Relations Act 1988 is whether it is satisfied that there is reasonable ground for the application. It will not be so satisfied if the grounds relied upon could not, even if made out, constitute "an irregularity in relation to an election for an office in the organisation". The question whether there is such an irregularity lies at the heart of this jurisdiction. Nor will it be so satisfied if the allegations of fact relied upon in the application do not at least offer good grounds for suspicion that there has been such an irregularity. The Court will not entertain an application of a speculative nature based upon the applicant's opinion that there has been irregularity unless that opinion rests upon some substantial factual foundation. Necessary conditions to establish the requisite state of satisfaction can be multiplied. It is harder to state what is sufficient to satisfy the Court beyond the words of the section itself which require an evaluative judgment at this preliminary stage.
The Applicant's Grounds

14. The first ground relied upon by the applicant was that r.18 is oppressive, unreasonable or unjust and therefore in contravention of s.196 of the Act because of the restrictive criteria which it establishes for determining whether or not a member is financial and entitled to vote. In this connection it is to be read in conjunction with r.21. The attack could more logically have been directed at r.21, the argument being that the rule is invalid because it operates unfairly in respect of a certain class of member and to exclude people from voting because of that rule constitutes an irregularity in relation to the election. Although it was not put that way, I consider this ground on the basis of the argument actually advanced and that to which I have just referred.

15. On the face of it there is nothing in the terms of rr.18 or 21 to support the contention that they contravene s.196. The applicant, however, relies not upon their language alone but their practical operation having regard to the way in which Union subscriptions are collected by deduction from the wages of some members. There is no doubt that the practical operation of a rule unobjectionable in form may cause it to contravene s.196:

"...a rule which may seem reasonable on its face may be
or become quite unreasonable and unjust or oppressive
in practice. All organizations have, through their
office bearers an obligation to their members to keep
their rules under review and to see that they do not
fall behind the developing needs of the organization".
- Gordon v Hospital Employees' Federation of
Australia (1975) 27 FLR 129 at 174; Lovell v
Federated Liquor and Allied Industries Employees'
Union of Australia (1978) 22 ALR 704 at 709.

And if a returning officer in the conduct of a union election relies upon a rule of the union which is invalid, then that reliance may constitute an irregularity in relation to the election even though proceedings have not been brought for a declaration of invalidity under s.208 - Leveridge v Shop Distributive and Allied Employees' Association (1977) 17 ALR 145 at 172; Allen v Townsend [1977] FCA 10; (1977) 16 ALR 301 at 346-7; Allen v Vehicle Builders Employees' Federation of Australia (1978) 22 ALR 510 at 515; Bucknall v Painting and Kindred Industries Union (1981) 52 FLR 258. In the latter case Toohey J. said at 261:

"It is a consequence of this line of authority that in
the present proceedings the applicant may, invoking
s.140, (now s.196) challenge the validity of a rule or
rules and if successful argue that the returning
officer's reliance upon that rule or those rules
constituted an irregularity."

In this case, however, if it be the case that some members were not financial because of the way in which their subscriptions were collected by deduction from their wages, the short answer is that the rules provide a simple remedy. By r.21 the member is deemed to be unfinancial "until all such...contributions...have been paid and ten days thereafter". There is nothing to suggest that a member who is unfinancial cannot take appropriate steps to rectify that situation in time to be eligible to vote. In my opinion, there is nothing in the rules themselves nor the rather general factual contentions underlying this ground, to satisfy me that it constitutes a reasonable ground for the application.

16. The second ground depends upon the contention that the alleged unlawful use of Union resources to support the campaign of the incumbent Secretary and certain other candidates constitutes an irregularity in relation to the election. In my opinion this ground cannot be sustained in light of the decision of the High Court in Re Collins; Ex parte Hockings [1989] HCA 42; (1989) 167 CLR 522. There it was held that the expression in the former Conciliation and Arbitration Act 1904 "irregularity in or in connection with an election" did not extend to activities, whether or not involving the use of Union funds, by which a particular candidate is promoted to voters. The reasoning reflected in the judgment of Gaudron J., with which the other members of the court substantially agreed, was sufficiently broadly based that the slightly different wording of the equivalent provisions of the Industrial Relations Act 1988 could not affect its application. In so saying, I note the concerns about the effect of the decision expressed by Wilcox J. in Re Davidson (1990) 31 IR 102. There is no basis therefore, upon which I could be satisfied that the second matter raised in the application discloses a reasonable ground for it.

17. The third ground arises from the refusal of Mr Post's nomination on the basis that he did not have three years continuous financial membership of the Union at the time of his nomination as required by r.22. It may well be that the requirement of three years continuous financial membership is oppressive and that it disqualifies a person who has had a brief and inconsequential period of arrears - see e.g. Lovell v Federated Liquor and Allied Industries Employees' Union of Australia (1978) 22 ALR 704 at 712. But Mr Post does not put his application on that ground. Rather, he contends that because of overpayments of subscriptions preceding 1989 he was financial at all material times in that year even though he did not pay his subscription for that year until May. In my opinion however, there is insufficient justification for the ground disclosed in the application. Neither the facts nor the submissions put to me indicate how I could come to the conclusion that there had been an overpayment in earlier years or how that overpayment could be credited against subscriptions.

18. The fourth and alternative ground does not, even if made out, in my opinion, constitute an irregularity in relation to an election.

19. For these reasons I propose to dismiss the application.