The number of contraventions
4 On the issue of the number of contraventions the CFMEU committed, the Commissioner contended that, since the conduct and state of mind of its officials, Mr Desmond and Mr Watson, is attributed to the CFMEU under s 793 of the FWA, that meant it had committed three contraventions, rather than one. That is, one contravention by its own conduct and two further contraventions, one each by the conduct and state of mind of Mr Desmond and Mr Watson.
5 To deal with the Commissioner's contention, it is necessary to outline the way in which he advanced his liability case at trial. I begin by noting that, in the liability judgment, I identified the various provisions of the FWA upon which the Commissioner relied (at [36]-[41]). Initially, the Commissioner sought to establish that the CFMEU, as a corporate body, had contravened ss 343 and 348 by two separate courses: as a principal contravener within the terms of the text of those two sections; and vicariously relying upon s 793 of the FWA and the conduct and state of mind of its officials. Both of those courses were available to the Commissioner.
6 The principal contravener allegations against all three respondents were pleaded in paragraphs 57 and 58 of the Commissioner's further amended statement of claim (FASC) (see the liability judgment at [42]). Before summarising the effect of those allegations, it is important to note that, at paragraph 2(b) and (c) of the FASC, the Commissioner pleaded that the CFMEU was "a 'person' within the meaning of that term in ss 343 and 348 of the FWA" and that it was a "body corporate by virtue of s 27 of the Fair Work (Registered Organisations) Act 2009 (Cth)". Both of these allegations were admitted in the CFMEU's defence.
7 These pleas are important because, stated compendiously, ss 343 and 348 of the FWA provide that "a person" must not "organise or take" action against another "with intent to coerce" that person to exercise, or not exercise, a workplace right. With respect to the word "person", s 2C of the Acts Interpretation Act 1901 (Cth) provides that "expressions used to denote persons generally (such as "person" …) "include a body politic or corporate as well as an individual". There is nothing in the text, context or purpose of ss 343, or 348, of the FWA that would justify the exclusion of a corporate person from the word "person" in those sections where a corporate body is acting as a principal through the agency of its officers or employees (see Hamilton v Whitehead (1988) 166 CLR 121 at 127, Hanley v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union (2000) 100 FCR 530; [2000] FCA 1188 at [51] per Ryan, Moore and Goldberg JJ, Director of the Fair Work Building Industry Inspectorate v Robinson (2016) 241 FCR 338; [2016] FCA 525 (Robinson) at [42], Fair Work Ombudsman v Australian Workers' Union [2017] FCA 528 at [89] per Bromberg J and Australian Building and Construction Commissioner v McDermott (No 2) [2017] FCA 797 (McDermott) at [86]-[87] per Charlesworth J). Accordingly, ss 343 and 348 of the FWA provide that a body corporate such as the CFMEU may be held to be liable for a contravention of those sections as a principal contravener.
8 Returning to the FASC, paragraph 57 pleaded the contravening conduct of each of the CFMEU, Mr Watson and Mr Desmond and then it was alleged that (paragraph 58):
By reason of the matters pleaded in paragraph 57 hereof, the CFMEU, Desmond and Watson breached s.343 and s.348 of the [FWA].
9 To make out these allegations against the respondents, the Commissioner sought to rely upon the presumption in s 361(1) of the FWA. That presumption focused on the allegations set out above and applied "unless the person proves otherwise" (see s 361(1) set out at [41] of the liability judgment). However, as I recorded in the liability judgment (at [43]): "[n]either Mr Watson nor Mr Desmond gave any evidence at the trial and the CFMEU itself did not call any evidence". Accordingly, from [43]-[51] of the liability judgment, I analysed the interaction between that choice and s 361, particularly as it related to the elements of the coercive conduct proscribed by ss 343 and 348 as illuminated in a number of authorities to which I referred. Then, at [52] of the liability judgment, I reached a series of conclusions about that interaction as it played out in this proceeding. The import of those conclusions (particularly the second, fifth and sixth) was that the combination of the allegations pleaded in paragraphs 57 and 58 of the FASC above and the presumption in s 361(1) of the FWA would make each of the three respondents - the CFMEU, Mr Watson, and Mr Desmond - individually liable for the contraventions of ss 343 and 348, should they fail to discharge their onus with respect to the third element as referred to in my sixth conclusion. That element was described at [50(c)] of the liability judgment, as follows: "in taking the action of calling and conducting the two hour union meetings, the pressure it applied to Hansen Yuncken was not unlawful, illegitimate or unconscionable." In the end result, I concluded that the CFMEU (meaning, in this context, each of the three respondents: see liability judgment at [3]) failed to discharge that onus and thereby contravened ss 343 and 348 of the FWA (see liability judgment at [127] and [154]). Accordingly, I found that each of the three respondents contravened those two sections as a principal contravener (at [155] of the liability judgment).
10 The second course that was available to, and relied upon by, the Commissioner was to endeavour to fix liability on the CFMEU vicariously relying on s 793 of the FWA. With respect to that section, I noted in the liability judgment (at [40]) that "the Commissioner claimed that, as a body corporate, the CFMEU was liable for the conduct of its officials, Mr Watson and Mr Desmond, pursuant to s 793 of the FWA". Section 793 provides:
Conduct of a body corporate
(1) Any conduct engaged in on behalf of a body corporate:
(a) by an officer, employee or agent (an official) of the body within the scope of his or her actual or apparent authority; or
(b) by any other person at the direction or with the consent or agreement (whether express or implied) of an official of the body, if the giving of the direction, consent or agreement is within the scope of the actual or apparent authority of the official;
is taken, for the purposes of this Act and the procedural rules, to have been engaged in also by the body.
State of mind of a body corporate
(2) If, for the purposes of this Act or the procedural rules, it is necessary to establish the state of mind of a body corporate in relation to particular conduct, it is enough to show:
(a) that the conduct was engaged in by a person referred to in paragraph (1)(a) or (b); and
(b) that the person had that state of mind.
Meaning of state of mind
(3) The state of mind of a person includes:
(a) the knowledge, intention, opinion, belief or purpose of the person; and
(b) the person's reasons for the intention, opinion, belief or purpose.
Disapplication of Part 2.5 of the Criminal Code
(4) Part 2.5 of Chapter 2 of the Criminal Code does not apply to an offence against this Act.
Note: Part 2.5 of the Criminal Code deals with corporate criminal responsibility.
(5) In this section, employee has its ordinary meaning.
I interpose that s 363 of the FWA contains similar provisions to s 793, although the Commissioner did not expressly rely upon that section in this case.
11 In Robinson, Charlesworth J made an important point about the effect of s 793. Her Honour observed that it did not fix liability for a contravention on the body corporate concerned, but rather attributed the conduct and state of mind of its officers, employees and agents to the body corporate in the prescribed circumstances. Her Honour went on to observe that it was therefore necessary to pay close attention to the conduct and state of mind of the officers concerned to determine whether the body corporate had, by that attributed conduct and state of mind, committed the contravention as alleged. She said (at [48] and [50]):
48 … The question of whether the body corporate has contravened the FW Act (and, if so, on how many occasions) must be answered by assessing the facts, namely the conduct and state of mind attributed to the body corporate, against the elements of the contravention said to have been committed by it.
50 … The mere fact that two employees of the CFMEU have each contravened the FW Act does not of itself, demand the conclusion that the CFMEU is liable for two contraventions.
In this case the critical elements of the contraventions of ss 343 and 348 were the negation of choice and the use of unlawful, illegitimate or unconscionable conduct (see the liability judgment at [45]-[46]).
12 The particular allegations in the Commissioner's FASC that sought to rely upon s 793 were the following (at paragraph 56):
The conduct of each of Desmond, Watson and Sutherland described at paragraphs 24, 26 to 29, 32 to 34, 39 to 48, 52 and 53 above was conduct which:
(a) Was engaged in by an officer, employee or agent of the CFMEU;
(b) Was engaged in within the scope of his actual authority on behalf of the CFMEU; and
(c) Was engaged in within the scope of that person's apparent authority on behalf of the CFMEU,
and thereby is taken to have been engaged in by the CFMEU by operation of section 793 of the [FWA].
13 Consistent with these allegations, the Commissioner had earlier pleaded in paragraphs 3 and 4 of his FASC that Mr Watson:
was at all material times:
(a) an employee of Bosform Pty Ltd (Bosform);
(b) from at least 1 May 2016, a delegate, or other representative, of the CFMEU;
(c) in the premises set out in paragraph 3(b), an officer of the CFMEU within the meaning of sections 12 and 793 of the FW Act.
As well, he pleaded that Mr Desmond:
is and was at all material times:
(a) an employee of the CFMEU;
(b) an organiser of the CFMEU;
(c) in the premises set out in paragraphs 4(a) and/or 4(b), an official, and therefore an officer, of the CFMEU within the meaning of sections 12 and 793 of the FW Act.
These allegations were admitted in the CFMEU's defence.
14 It will be noted that Mr Sutherland's conduct was expressly mentioned in paragraph 56 of the FASC above. It is therefore important to digress to note a number of things about that inclusion. First, Mr Sutherland was, as is mentioned in passing in the Commissioner's FASC (at paragraph 24), the Assistant State Secretary of the CFMEU. Secondly, he was not named as a respondent party in this proceeding and, consequently, no reliance could have been placed on the presumption in s 361(1) with respect to his reasons, intentions or conduct. Thirdly, unlike with Mr Watson and Mr Desmond above, Mr Sutherland's status as an officer, representative, or employee of the CFMEU was not expressly pleaded in the FASC. Fourthly, however, Mr Sutherland's involvement in the events constituting the CFMEU's contraventions of ss 343 and 348 was pleaded at a number of points throughout the FASC. In particular, his involvement in four conversations - one in person and three by telephone - which occurred on 11, 18, 20 and 24 May 2016. In this respect, it is important to note that the union meetings that were central to the CFMEU's contraventions of ss 343 and 348 of the FWA were called and conducted between 9 May 2016 and 1 June 2016 (see the liability judgment at [23]). The pleading of those conversations in the FASC was as follows:
39. On or about 11 May 2016, Baumann and Michael Vicenzino, Queensland Construction Manager of Hansen Yuncken (Vicenzino) met with Sutherland, at the offices of the CFMEU at Bowen Hills.
40. During the course of the meeting referred to in the preceding paragraph, an exchange to the following effect occurred: Baumann said: The Draft CFMEU Agreement has been assessed by external parties engaged by Hansen Yuncken who advised that the Draft CFMEU Agreement included clauses that were non-compliant with the Building Code and that Hansen Yuncken were not able to proceed with a noncompliant collective agreement. Sutherland said: The wording of clause 41 is for the purpose of amending the agreement to enable contractors to bid for Government work. Baumann said: The communication meetings are inappropriate and disruptive. Sutherland did not respond.
41. On or about 18 May 2016, Baumann had a telephone conversation with Sutherland.
42. During the course of the telephone call referred to in the preceding paragraph, an exchange to the following effect occurred: Baumann said: Will the communication meetings cease if Hansen Yuncken execute the draft collective agreement? Sutherland said: I am not saying that.
43. On 20 May 2016, Baumann and Vicenzino spoke by telephone with Sutherland.
44. During the course of the telephone call referred to in the preceding paragraph, an exchange to the following effect occurred: Baumann said: We are reviewing your clause 41 and seeking external advice. The amended clause 41 does not address the concerns we have. The ongoing two-hour meetings are damaging to Hansen Yuncken, our client, stakeholders and subcontractors. They should cease while we are continuing discussions in good faith. Vicenzino said: Andy, please stop the 2 hour meetings, let's talk. The subbies have had a gutful of this. Sutherland said: Our lawyers have advised that the amended clause 41 would enable building contractors to renegotiate a different collective agreement if it was determined that they could not bid for future government work. I'll have to go and talk to others about this. I'll get back to you. Sutherland made no response to Baumann's statement concerning the two-hour meetings.
47. On 24 May 2016 at approximately 4pm, Baumann, Vicenzino and Sutherland spoke by telephone.
48. During the course of the telephone discussion referred to in the preceding paragraph, an exchange to the following effect occurred: Baumann said: The stoppages are receiving significant media attention. Let's stop the 2 hour meetings, get back to work and promote a message that the CFMEU and Hansen Yuncken are progressing towards a mutually acceptable agreement. Sutherland said: I am in Darwin at present together with Michael Ravbar. I'll have to discuss with him and get back to you, but I don't know. Baumann or Vicenzino said: That would be appreciated as the stoppages are really hurting all parties and it's unfair to continue the current actions.
As can be seen from paragraph 56 of the FASC above, all of the above paragraphs describe conduct which the Commissioner sought to attribute to the CFMEU under s 793. I will return to the significance of Mr Sutherland's role later in these reasons.
15 Having outlined how the Commissioner pleaded his case that the CFMEU had contravened ss 343 and 348 by means of the second course, it is necessary to return to the way in which these two courses were pursued, or not pursued, at the trial of this matter. As I have already mentioned above, because of the application of the presumption in s 361(1) of the FWA and the forensic choice the three respondents made not to call any evidence to attempt to displace that presumption, the Commissioner was ultimately able to establish that the CFMEU, as a corporate body, and Mr Watson and Mr Desmond had all contravened ss 343 and 348 as principal contraveners. Namely by the first course that was available to him. In that process, it was not necessary to analyse the reason or intent that Mr Watson or Mr Desmond had as individuals, or which the CFMEU itself had, when they variously engaged in the conduct constituting the contraventions. In the unusual forensic circumstances that emerged at the trial of this matter, the operation of the presumption in s 361(1) of the FWA therefore resulted in the conduct and state of mind of the CFMEU and its two officials being considered together as a whole. Furthermore, since those three persons were found to be principal contraveners, there was no necessity to consider the Commissioner's reliance on s 793 of the FWA to fix liability on the CFMEU vicariously by reason of the conduct and state of mind of its officials (see the liability judgment at [52]: third conclusion).
16 It can therefore be seen that the trial of this matter was conducted solely on the Commissioner's primary case and that resulted in the CFMEU being found liable as a principal contravener. It follows that, by raising this issue at this stage of this proceeding, the Commissioner is effectively contending that the Court should now embark upon his undetermined alternative case for the sole purpose of visiting an additional penalty on the CFMEU. For the reasons that follow, I do not consider this is a course that should, or could, be adopted.
17 In the first place, since the liability trial in this matter is complete, the Commissioner's proposal would essentially require me to now conduct a hypothetical trial on the Commissioner's alternative case. In my view, that course would constitute an extraordinary waste of resources, both public and private. It would be akin to conducting a hypothetical trial for the sole purpose of determining costs in a proceeding, an approach which courts have generally rejected as wasteful (see Ann Street Mezzanine Pty Ltd v KPMG [2011] FCA 453 at [24] per Kenny J and the cases there cited).
18 But apart from being wasteful, there is another equally compelling reason why the Commissioner's proposal cannot be adopted. It arises from the observations of Charlesworth J in Robinson (see at [11] above). If the course now contended for by the Commissioner were to be taken, that would require an assessment of the conduct and state of mind of Mr Watson and Mr Desmond to determine whether, if that conduct and state of mind were attributed to the CFMEU, it would be sufficient to establish all of the elements of a contravention by it of ss 343 and 348 of the FWA, namely the negation of choice and the use of unlawful, illegitimate or unconscionable conduct. There is a number of reasons why that assessment is neither feasible nor possible.
19 First, as I have endeavoured to explain above, because of the operation of the presumption in s 361 of the FWA and the peculiar forensic circumstances that emerged at the trial of this matter, it was unnecessary to examine the conduct and state of mind of Mr Watson and Mr Desmond separately from the conduct of the CFMEU. Nonetheless, if the Commissioner's proposed course were to be adopted, Robinson demonstrates that that examination would be required. To attempt that exercise at this stage of this proceeding would be very difficult, if not impossible. Secondly, even if their conduct and state of mind could now be separated for the purposes of that assessment, that process would be unlikely to establish all of the critical elements of the contraventions of ss 343 and 348. That is so because Mr Watson's and Mr Desmond's main involvement in those contraventions was to call and conduct the union meetings between 9 May 2016 and 1 June 2016. However, as I have already mentioned above in dealing with the seriousness of the CFMEU's contravening conduct (see at [3]), it was not the calling and conduct of those union meetings per se that comprised the unlawful and illegitimate conduct elements of the contraventions. Rather it was the pattern in which those meetings were called. This is important because, based on the evidence called at the trial, that pattern was most likely to have been devised by someone in a position of authority in the CFMEU hierarchy, above Mr Watson and Mr Desmond, both of whom were the CFMEU's local officials at the Carrara project site. That being so, if the conduct and state of mind of Mr Watson and Mr Desmond were to be attributed to the CFMEU, it would most likely be insufficient, by itself, to establish all of the necessary elements of the contraventions. Which brings me to the involvement of Mr Sutherland. As I have already observed above, the Commissioner's pleaded case on s 793 placed particular reliance on Mr Sutherland's involvement in the events of May 2016. Because of the way in which the Commissioner's primary case was determined, it was unnecessary to consider that involvement, associated, as it was, with the Commissioner's alternative case relying on s 793. However, if the Commissioner's alternative case were now to be considered, the matters mentioned above demonstrate why Mr Sutherland's role would become quite significant. Some of the difficulties associated with attempting to examine his role at this late stage of the proceeding have already been outlined above (see at [14]). It is difficult to see how those difficulties could be overcome. For instance, overcoming Mr Sutherland's non-party status, or the lack of any pleading in the FASC about his status as an employee or officer of the CFMEU. In any event, the Commissioner has not sought to attempt to address either of these matters.
20 So, having regard to all the complications outlined above, I do not consider it is appropriate, or even possible, to now attempt to embark upon a consideration of the Commissioner's alternative case for the purposes of this penalty judgment. Instead, I consider the only sensible and feasible approach is that taken in the liability judgment. That is, to treat the CFMEU's contraventions of ss 343 and 348 as one whole contravention relying, in part only, on the conduct of Mr Watson and Mr Desmond.
21 It is worth adding that, even if it had been appropriate, or possible, to adopt the course proposed by the Commissioner, it is likely that it would have resulted in the same outcome as I have come to above. I say that because Charlesworth J took a course similar to that proposed by the Commissioner and reached a similar conclusion to that above in Robinson, albeit with respect to a different provision of the FWA (s 417). The contravening conduct at issue in Robinson occurred at two separate meetings on the same day as a result of which a group of employees failed to attend work. Section 417 relevantly provided that a person must not "organise or engage in industrial action" in those circumstances. As has already been mentioned above, her Honour found that this section attached liability to the CFMEU as a principal contravener (Robinson at [42]), however, a question arose in Robinson whether the CFMEU had committed two contraventions because of the operation of s 793 (see Robinson at [43]). On this question, her Honour examined the CFMEU's conduct "as a whole" and concluded that it organised a single instance of industrial action and had therefore committed one contravention (see Robinson at [52] and [54]).
22 Furthermore, Jessup J took a similar approach in The Yarra's Edge Case. That matter also involved a contravention of s 417 of the FWA. The circumstances of the contravention and the conclusion his Honour reached about there being only one contravention appears from the following observations:
All of the organisers were employees of the CFMEU, and thus officers by the operation of s 69(3). Their conduct was attributed to the CFMEU. It does not follow, however, that the CFMEU contravened s 38 as many times as the organisers in total did. This provision had an effect which differed in an important way from s 48(2): it was the conduct, not each contravention, which was attributed to the building association (see Director of the Fair Work Building Industry Inspectorate v Robinson [2016] FCA 525 at [50]). Having attributed the conduct, the question remains: did that conduct amount to engagement in unlawful industrial action within the meaning of s 38, and if so, to how many separate instances thereof? On the facts of the present case, it would, in my opinion, be artificial to regard the conduct of the CFMEU as having amounted to a separate engagement in industrial action in respect of the conduct of each of the five organisers concerned. It may have amounted to a separate engagement on each of the discrete occasions on which those organisers prevented Mr Brinzi from bringing a vehicle on to the site, but that, as I have already held, was not the way the applicant conducted his case. I would hold, therefore, that the CFMEU contravened s 38 of the BCII Act once.
23 Three other recent cases are also worth mentioning on this aspect. In Australian Building and Construction Commissioner v Harris [2017] FCA 733 (Harris), Siopis J dealt with a contravention of s 500 of the FWA which relevantly concerns a "permit holder" rather than a person (as to which see further at [23] below). On the issue of the number of contraventions, his Honour cited Robinson and The Yarra's Edge Case above and concluded that, in the circumstances of that matter, there had only been one contravention by the CFMEU (see Harris at [51]). On the other hand, in Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (No 3) [2017] FCA 10 (CFMEU (No 3)), Besanko J considered Robinson and The Yarra's Edge Case (at [31]-[35]) together with a number of decisions upon which the Commissioner relied (see at [36]) and concluded that, since two separate threats had been made, that justified his Honour finding that two distinct contraventions had been committed (see at [37] and [39]).
24 Finally, in McDermott, Charlesworth J dealt with a contravention of s 500 of the FWA which, like ss 343 and 348, is a civil remedy provision. However, that provision applies to a permit holder, rather than a person. This gave rise to the question whether the CFMEU, as a corporate body, could be held to have contravened that provision. Relying upon the decision of Siopis J in Harris, Charlesworth J concluded that it could not. However, in the course of her reasons (at [9]), her Honour noted that s 545 of the FWA allowed this Court to make such order as it considers appropriate if it is satisfied that "a person" has contravened a civil remedy provision. Her Honour then conducted a detailed and comprehensive examination of the differences between fixing liability for a contravention on a principal contravener, and establishing liability for a contravention vicariously under s 793, or as an accessory under s 550. Apart from citing the following observation, it is unnecessary, for the purposes of this issue, to review her Honour's reasons on those questions. At [88], however, her Honour made the following pertinent observations about the operation of s 545 of the FWA:
I have already observed that Section 545 of the Act empowers the Court to grant certain remedies if satisfied that a person "has contravened" a civil remedy provision. The words "has contravened" to my mind indicate that the person in question must be shown to have actually (or otherwise deemed to have actually) contravened the prohibition in question. For an example of a deeming provision, see s 550 of the Act, extracted at [94] below. The text of s 545 tends against an outcome where a permit holder may pay a penalty for his or her contravention and a registered organisation also pay a penalty in respect of liability that is truly vicarious in its nature, rather than direct or deemed to be direct.
The observation in the last sentence is important in this matter. That is so because the deeming provision in s 550 of the FWA is similar in its effect to the presumption in s 361, albeit that it applies to the whole contravention rather than particular elements of it. However, importantly, it is to be contrasted with the provisions of s 793, which, as is noted above, does not fix any liability for the contravention on the body corporate concerned.
25 For these reasons, I reject the Commissioner's contention that the CFMEU should, in the particular circumstances of this matter, be found to have committed more than one contravention of each of ss 343 and 348 of the FWA.