Brown v Health Services Union

REASONS FOR JUDGMENT 1 There has in recent times been considerable disruption and publicity in respect to the activities of what has been identified as the "Health Services Union" or the "HSU". 2 More accurately, what is being referred to is a state-registered industrial organisation and an autonomous branch of a federally-registered union. Little distinction has been publicly drawn between the state-registered HSUeast union and the federally-registered HSU East Branch. HSUeast ('the State Union') is an organisation of employees registered under the Industrial Relations Act 1996 (NSW) ('the State Industrial Relations Act'). The HSU East Branch ('the Federal Branch') is a branch of the Health Services Union. The Health Services Union ('the Federal Union') is an organisation of employees registered under the Fair Work (Registered Organisations) Act 2009 (Cth) ('the Commonwealth Registered Organisations Act"). 3 The considerable media attention that has attended the activities of the Federal Branch and the State Union may be traced back to at least September 2011. On 10 September 2011 it was widely publicised that Ms Katherine Jackson had referred allegations of corruption levelled at Mr Michael Williamson (the Secretary of the State Union and the Federal Branch as well as the President of the Federal Union) to the New South Wales Police. 4 The unhappy events in which both the Federal Branch and the State Union have been embroiled have ultimately led (inter alia) to a number of proceedings commenced both in this Court and the Industrial Court of New South Wales. 5 When the proceedings came before the Court for hearing on Tuesday 5 June 2012 there were four proceedings on foot, namely: an application commenced by Ms Katherine Jackson on 20 April 2012. Ms Jackson, describes herself as a Union Official in the State of Victoria. She is the Executive President of the State Union and the Federal Branch as well as the National Secretary of the Federal Union. Her Originating Application sought relief (inter alia) pursuant to s 164 of the Commonwealth Registered Organisations Act; an application by the Federal Minister for Employment and Workplace Relations ('the Federal Minister'). That Application sought a "declaration under section 323(1) of the Fair Work (Registered Organisations) Act 2009 (Cth) that the HSU East Branch has ceased to function effectively and there are no effective means under the rules of the organisation by which it can be enabled to function effectively" as well as similar declaration in respect of the State Union; an application commenced on 2 May 2012 by Mr Christopher Paul Brown and several other members of the Federal Union. Mr Brown is the Vice-President of the Federal Union, Branch Secretary of the Tasmanian No 1 Branch of the Federal Union and has also been the Acting National President of the Union since Mr Michael Williamson stepped aside on 23 September 2011. That Originating Application was in substantially similar terms to the Minister's Originating Application; and a proceeding of the New South Wales Industrial Court which was transferred to this Court pursuant to orders made by S G Campbell J of the Supreme Court of New South Wales. His Honour published his reasons for decision for transferring the proceeding before that Court pursuant to the Jurisdiction of Courts (Cross-Vesting) Act 1987 (NSW) on 23 May 2012: Katherine Jackson v Peter James Mylan [2012] NSWSC 552. The Applicants in this proceeding sought a declaration in identical terms to the Applications by Mr Brown and the Federal Minister, but pursuant to s 290B of the State Industrial Relations Act. By the end of the hearing on 7 June 2012, only two proceedings remained. Ms Jackson's Counsel sought and were granted leave to discontinue her Application on 7 June 2012. A Notice of Discontinuance was filed in Court that day. Senior Counsel for the Federal Minister had earlier sought and was granted leave to discontinue his proceeding on 6 June 2012 and filed a Notice of Discontinuance in Court that day. 6 Leave was granted to Mr Brown on 6 June 2012 to file an Amended Application. The Application as amended sought (inter alia) declaratory relief under s 290B of the State Industrial Relations Act in respect to the State Union and declaratory relief under s 323 of the Commonwealth Registered Organisations Act in respect to the Federal Branch. 7 The two remaining proceedings focused attention upon the orders to be made, if any, against the Federal Branch and/or the State Union. 8 These two proceedings were heard together. Orders were made that the evidence in one proceeding was also to be evidence in the other. Orders were also made that evidence filed in the Federal Minister's discontinued proceeding would be evidence in the remaining proceedings. 9 The proceedings commenced in this Court were initially set down for hearing for 3 weeks at a directions hearing on 3 May. At a later directions hearing on 31 May 2012 this estimate was considerably reduced. At that stage it emerged that the parties were in agreement that: both the Federal Branch and the State Union had ceased to function effectively; and that there were no effective means under the rules of either organisation whereby the difficulties could be effectively resolved. There was also substantial agreement between the parties as to: the facts necessary to resolve each of the proceedings; the appropriateness of making declaratory relief that both the Federal Branch and the State Union had ceased to function effectively; and the desirability of an administrator being appointed. Three areas of concern were then identified as requiring particular attention, namely: whether the Federal Branch should be "demerged"; the terms of the "scheme" to be approved; and the identity of the administrator or administrators. All parties agreed that it would be unnecessary for the Court to resolve the merits of the competing allegations of misconduct by union officials or other persons. The very fact that there were competing allegations being made by and against members, it was said, went to the heart of why both the Federal Branch and the State Union had ceased to function effectively. 10 Notwithstanding the substantial narrowing of the issues, it remains necessary to address - albeit in less detail than would otherwise have been the case - the following matters: the factual background leading to the establishment of the Federal Branch and the State Union in their present form; the powers to be exercised by this Court; the jurisdiction of the Court, particularly in relation to the orders and declarations sought in respect of the State Union; the parties to the two remaining proceedings, including the status of those who are said to have intervened and those who have sought to be heard; the factual basis supporting any conclusion that both the Federal Branch and State Union have "ceased to function effectively"; the basis upon which it should be concluded that there are "no effective means under the rules" that would enable the Federal Branch or the State union to resolve the difficulties dividing the "factions" and the "antagonism" between those "factions"; the basis for granting declaratory relief (if any); if declaratory relief is granted, the exercise of the discretion to approve a scheme; and the terms of the scheme to be approved, including whether or not there is power to appoint an administrator; whether there should be a vacation of all offices and whether there should be an immediate demerger of the Federal Branch. 11 A further application foreshadowed on 5 June 2012 - principally by Senior Counsel for the State Union - was the need for this Court to give consideration to the appointment of an interim administrator pursuant to s 290B(3) of the State Industrial Relations Act. Pursuant to s 290B(4) the State Minister, so it was contended on his behalf, also retained power to appoint an interim administrator. That power, it was contended, could be exercised from Monday 11 June 2012 if the Court had not already taken the step of making such an order. This application was deferred until Friday 8 June 2012 in the hope that the State Minister would agree to defer the exercise of any such power as remained with him to enable this Court to resolve the Applications before it on a final basis. Regrettably, and perhaps inexplicably, the State Minister would not commit himself to refraining from exercising or purporting to exercise the power conferred by s 290B(4). 12 On 8 June 2012 the manner in which the proceedings had been conducted up to that point was challenged. A number of oral applications were either made or (at the very least) foreshadowed by Ms Jackson at that time. Those applications included an application that the Court as presently constituted be disqualified on the grounds of apprehended bias, an application that the proceedings be adjourned, and an application to (in effect) reopen the evidence. 13 At the conclusion of the hearing on 8 June 2012 the Court appointed the Honourable Michael Moore as an interim administrator of the Federal Branch and the State Union. 14 The hearing was adjourned part heard until 15 June 2012. The hearing concluded on that day.

THE POWERS BEING EXERCISED 27 Declarations are sought that the Federal Branch and State Union have ceased to function effectively and that there are no effective means under the rules which can remedy the situation. Reference is made in the Originating Applications, either as initially filed or as amended, to s 323 of the Commonwealth Registered Organisations Act and to s 290B of the State Industrial Relations Act. 28 The legislative intention in enacting the Commonwealth Registered Organisations Act is set forth in s 5 of that Act as follows: Parliament's intention in enacting this Act (1) It is Parliament's intention in enacting this Act to enhance relations within workplaces between federal system employers and federal system employees and to reduce the adverse effects of industrial disputation. (2) Parliament considers that those relations will be enhanced and those adverse effects will be reduced, if associations of employers and employees are required to meet the standards set out in this Act in order to gain the rights and privileges accorded to associations under this Act and the Fair Work Act. (3) The standards set out in this Act: (a) ensure that employer and employee organisations registered under this Act are representative of and accountable to their members, and are able to operate effectively; and (b) encourage members to participate in the affairs of organisations to which they belong; and (c) encourage the efficient management of organisations and high standards of accountability of organisations to their members; and (d) provide for the democratic functioning and control of organisations; and (e) facilitate the registration of a diverse range of employer and employee organisations. (4) It is also Parliament's intention in enacting this Act to assist employers and employees to promote and protect their economic and social interests through the formation of employer and employee organisations, by providing for the registration of those associations and according rights and privileges to them once registered. 29 Section 323 of the Commonwealth Registered Organisations Act provides: Federal Court may order reconstitution of branch etc. (1) An organisation, a member of an organisation or any other person having a sufficient interest in relation to an organisation may apply to the Federal Court for a declaration that: (a) a part of the organisation, including: (i) a branch or part of a branch of the organisation; or (ii) a collective body of the organisation or a branch of the organisation; has ceased to exist or function effectively and there are no effective means under the rules of the organisation or branch by which it can be reconstituted or enabled to function effectively; or (b) an office or position in the organisation or a branch of the organisation is vacant and there are no effective means under the rules of the organisation or branch to fill the office or position; and the Court may make a declaration accordingly. (2) Where the Court makes a declaration under subsection (1), the Court may, by order, approve a scheme for the taking of action by a collective body of the organisation or a branch of the organisation, or by an officer or officers of the organisation or a branch of the organisation: (a) for the reconstitution of the branch, the part of the branch or the collective body; or (b) to enable the branch, the part of the branch or the collective body to function effectively; or (c) for the filling of the office or position. (3) Where an order is made under this section, the Court may give any ancillary or consequential directions it considers appropriate. (4) The Court must not make an order under this section unless it is satisfied that the order would not do substantial injustice to the organisation or any member of the organisation. (5) The Court may determine: (a) what notice, summons or rule to show cause is to be given to other persons of the intention to make an application or an order under this section; and (b) whether and how the notice, summons or rule should be given or served and whether it should be advertised in any newspaper. (6) An order or direction of the Court under this section, and any action taken in accordance with the order or direction, has effect in spite of anything in the rules of the organisation or a branch of the organisation. (7) The Court must not under this section approve a scheme involving provision for an election for an office unless the scheme provides for the election to be held by a direct voting system or a collegiate electoral system. An "organisation" is defined in s 6 of the Commonwealth Registered Organisations Act as an "organisation registered under this Act". The Federal Union's status as a registered organisation was not in issue. 30 The predecessor to s 323 was s 171D of the Conciliation and Arbitration Act. As at September 1986, s 171D was in the following terms: (1) An organization, a member of an organization or any person having a sufficient interest in respect of an organization may apply to the Court for a declaration that - (a) a part of the organization, including - (i) a branch or part of a branch of the organization; or (ii) a collective body of the organization or of a branch of the organization, has ceased to exist or to function effectively and there are no effective means under the rules of the organization or branch by which it can be reconstituted or enabled to function effectively; or (b) an office or position in the organization or in a branch of the organization is vacant and there are no effective means under the rules of the organization or branch to fill the office or position, and the Court has jurisdiction to hear and determine the application and to make a declaration accordingly. (2) Where the court makes a declaration under sub-section (1), the court may, by order, approve a scheme for the taking of action by a collective body of the organization or of a branch of the organization or by an officer or officers of the organization or of a branch of the organization for the reconstitution of the branch or part of the branch, or of the collective body, or to enable it to function effectively, or for the filling of the office or position. (3) Before making an order under this section the Court shall satisfy itself that the order would not do substantial injustice to the organization or to any member of the organization. (4) Where any such order is made, the Court may give such ancillary or consequential directions as it thinks fit. (5) An order or direction of the Court under this section, and any action taken in accordance with such an order or direction, has effect notwithstanding anything in the rules of the organization or of a branch of the organization. (6) The Court may determine what notice, summons or rule to show cause is to be given to other persons of the intention to make an application under this section or of the intention to make an order under this section, and whether and how it should be given or served and whether it should be advertised in any newspaper. (7) Where - (a) a scheme to be approved under this section will involve provision for an election for an office in the organization concerned; and (b) the rules of the organization in force, or purporting to be in force, provide, in respect of that office, for - (i) a collegiate electoral system, or an electoral system which, although it is not a "collegiate electoral system" as defined in section 4, is of a similar nature; or (ii) a direct voting system, or a voting system which, although it is not a "direct voting system" as defined in section 4, is of a similar nature, the Court shall not, in proceedings under this section, where sub-paragraph (b) (i) applies, approve a scheme that provides for an election for that office otherwise than under a collegiate electoral system or, where sub-paragraph (b) (ii) applies, approve a scheme that provides for an election for that office otherwise than under a direct voting system, or in either case a scheme that departs from the provisions of those rules to a greater extent than the Court is satisfied is necessary having regard to the requirements of this Act. 31 A challenge to the constitutionality of s 171D was rejected in R v Joske; Ex parte Shop, Distributive and Allied Employees' Association (1976) 135 CLR 194. In that decision the Court held that the very width of the powers conferred by the provision did not involve the conferral upon a federal court of non-judicial functions. No doubt by reason of that decision, there was no suggestion in the present proceedings that the terms of s 323 of the Commonwealth Registered Organisations Act conferred non-judicial functions on this Court. The following observations of Stephen J in Joske nevertheless remain a useful reminder of the width of the powers intended by the Legislature to be conferred upon this Court: Section 171D(1) empowers the Industrial Court to declare that a part of an organization has ceased to exist or to function effectively or that an office or position in an organization has become vacant, and that no effective means exists under the organization's rules to remedy this. Then sub-s. (2) empowers the Court, having made such a declaration, to approve a scheme "for the taking of action by a collective body of the organization or of a branch of the organization or by an officer or officers of the organization or of a branch of the organization for the reconstitution of the branch or part of the branch, or of the collective body, or to enable it to function effectively, or for the filling of the office or position" (sub-s. (2)) but it must first satisfy itself "that the order would not do substantial injustice to the organization or to any member of the organization" (sub-s. (3)). It is the power to rectify, modify or validate as the Court thinks fit, and the power to determine whether an organization has ceased "to function effectively" and, if so, to sanction a scheme to rectify the position, in each case qualified only by the provision as to substantial injustice, that are particularly seized upon by the prosecutors as revealing in these sections that other than judicial power has been conferred on the Court. These provisions are concerned exclusively with the nature of the remedies open to the Court once it has adjudicated upon matters which have been initiated by a party and the determination of which is an eminently judicial function. The particular nature of an available remedy, at least when it is one not unfamiliar as part of the traditional equipment of courts of law or equity, can seldom be such as of itself to involve a court in a non-judicial function. [(1976) 135 CLR at 209-210] Mason and Murphy JJ similarly concluded: … There is to our mind nothing in the issues which s. 171D(1) poses for decision that is alien to the exercise of judicial power. Such issues of fact as the question whether part of an organization has ceased to exist or to function effectively, whether there are effective means under the rules by which it can be reconstituted or enabled to function effectively, are issues of fact well suited to judicial determination. So also are the issues posed by par. (b) of sub-s. (1) : (1976) 135 CLR at 218. 32 In later decisions regarding s 171D it was accepted that the provision was to be given no "narrow interpretation": Federated Cold Storage & Meat Preserving Employees Union of Australasia; Ex parte Gallagher (1983) 79 FLR 26 at 31-32 per Smithers J. His Honour there said: Considerable novelty may be appropriate in a scheme submitted under s 171D. It would seem that the court should be guided not by any narrow interpretation of s 171D, but should respond to the purpose of that section in the context of the Act and of Pt IXA of the Act. Part IXA is headed "Validating provisions for Organisations". The objects of the Act are not in doubt. They are to encourage the organisation of representative bodies of employers and employees and their registration under the Act and to equip them with effective representative governing bodies so that they may play a part in the national procedures of conciliation and arbitration of industrial disputes. Recognising that in the management of such organisations according to their rules, complex situations arise and on occasion lead to complete frustration, Parliament enacted Pt IXA. The provisions of that part are directed to the relief of organisations in situations in which the effect of rules has led to invalidity in various respects. The notion discernible is that, in such situations, subject to the overriding rule, that injustice shall be avoided, relief may be provided. … Section 171D is in the midst of the sections last mentioned and stems from the intention of Parliament to revive the effective management and administration of organisations when governing bodies have become defunct or impotent or are unable to function effectively because the rules fail to speak effectively in the relevant current circumstances. Its provisions should therefore be liberally construed. In the absence of more detailed limitation of the nature of the scheme which may be approved the contents of a scheme, within the ambit of the power to approve, must in my opinion extend to a scheme for the taking of steps which will reconstruct the defunct body by making that body again, giving it a new constitution appropriate for a body with the functions envisaged. And the scheme may contain those other provisions which will enable the body in its environment to function effectively for the purposes for which it is constituted. The provisions in a scheme must however represent a faithful pursuit of the purposes for which the power to approve such a scheme was conferred on the court by Parliament. As Dixon J, as he then was, said in R v Burgess; Ex parte Henry (1936) 55 CLR 608 at 674: "It is apparent that the nature of the power necessitates a faithful pursuit of the purposes. ... No doubt the power includes the doing of anything reasonably incidental to the execution of the purpose. But wide departure from the purpose is not permissible." In assessing the purpose of the provision the remedial aspects must inevitably prevail, so that as a matter of interpretation, the emphasis is on the approval of a practical scheme rather than on the authorisation of a particular person to take action. In relation to the scheme submitted in this case considerable effort has been expended to acquaint all members with its contents and the changes in the organisation which it is thought will be implemented by the reconstituted collective body which will come into existence pursuant to the scheme. In the same decision Northrop J similarly recognised that the powers conferred were "… extremely wide and should not be restricted": (1983) 79 FLR at 43. 33 Section 323 of the Commonwealth Registered Organisations Act is in substantially the same terms and should be given a similarly broad interpretation. The width of the powers should not be doubted. Section 323 should thus be given an interpretation consistent with the natural meaning of the words employed and the objects and purposes of the Act. 34 The power conferred by s 323(2) to "approve a scheme" most probably includes a power to either amend a proposed scheme or even to devise a scheme: Gordon v Carroll (1975) 27 FLR 129. Smithers, Woodward and St John JJ there observed in an obiter comment: … we are inclined to the view that a power to approve a scheme must include a power to amend a proposed scheme or, where necessary, to devise one. It follows from this that such a scheme may be proposed by any party to the proceedings. However, it is clearly preferable that, whenever possible, the scheme should be proposed by those who will have to administer it. [(1975) 27 FLR at 166] And when exercising the discretion "[i]t is for the Court … to satisfy itself as to the appropriateness of a proposed scheme from the point of view of the current structure of the organisation, fairness and justice thereof as between members and branches, and the necessity for the organisation to be equipped with effective governing bodies elected on a suitably democratic basis": Ex parte Gallagher (1983) 79 FLR at 30 per Smithers J. 35 Section 323 is a power which has previously been exercised - significantly, perhaps, in respect to a former branch of the Federal Union. In August 2009, Tracey J concluded that the then Victoria No 1 Branch had ceased to function effectively: Health Services Union [2009] FCA 829, 187 IR 51. In so concluding his Honour said in part: [1] For over a year the Victoria No 1 Branch of the Health Services Union has become progressively more dysfunctional. At its root, the cause of this dysfunction has been antagonism between two groups formed by members of the Branch's Committee of Management and their supporters within the Branch membership. One group coalesces around the Branch President Ms Pauline Fegan. Ms Fegan is also a paid employee of the Branch. The other is led by the Branch Secretary Mr Jeff Jackson. [2] Disputes between the two groups have given rise to a series of events which have severely undermined the functioning of the Branch. The result has been that Branch officers have been deflected and distracted from the pursuit of the industrial interests of the members. [3] It is unnecessary to record all of the disruptive events which have occurred over the past year. Some examples will suffice: • Allegations by staff members of the Branch that they have been harassed and intimidated by Ms Fegan and some of her supporters. These allegations have led to the institution of inquiries and the laying of disciplinary charges. • The terminations of the employment of some staff members which were challenged in proceedings in the Australian Industrial Relations Commission. • A dispute between Mr Jackson and Ms Fegan which led to staff members not being paid for some weeks. • Staff "locking-out" Branch officials from the Branch Office. • Meetings of the Branch's Committee of Management being disrupted by bickering and walkouts by some members. • The making of allegations and counter allegations of misconduct on the part of Ms Fegan and Mr Jackson. • The suspension from duty of various officers of the Branch. [4] Attempts by federal officials of the Union to mediate in the dispute have not succeeded. Various inquiries have not led to decisive remedial action. An attempt to bring matters to a head at a specially convened general meeting of the Branch was frustrated when the meeting dissolved into disorder and had to be abandoned without dealing with all of the business which it had been convened to consider. Various applications, made to this court, have not had any impact on the underlying issues. Large sums have been spent on legal fees and inquiries with the result that the Branch is in a parlous financial state. The Mr Jackson to whom his Honour refers is the former husband of Ms Katherine Jackson. The events summarised by Tracey J, regrettably, have a disturbing echo with many of the facts being canvassed in the present proceedings. 36 Following the filing of the Minister's Application, the New South Wales Parliament amended the State Industrial Relations Act to insert, inter alia, s 290B. The objects of that Act are expressed in s 3 as follows: Objects The objects of this Act are as follows: (a) to provide a framework for the conduct of industrial relations that is fair and just, (b) to promote efficiency and productivity in the economy of the State, (c) to promote participation in industrial relations by employees and employers at an enterprise or workplace level, (d) to encourage participation in industrial relations by representative bodies of employees and employers and to encourage the responsible management and democratic control of those bodies, (e) to facilitate appropriate regulation of employment through awards, enterprise agreements and other industrial instruments, (f) to prevent and eliminate discrimination in the workplace and in particular to ensure equal remuneration for men and women doing work of equal or comparable value, (g) to provide for the resolution of industrial disputes by conciliation and, if necessary, by arbitration in a prompt and fair manner and with a minimum of legal technicality, (h) to encourage and facilitate co-operative workplace reform and equitable, innovative and productive workplace relations. That provision was obviously in place prior to the amendments most recently enacted. Those amendments were assented to on 11 May 2012. The new s 290B provides as follows: Commission may order reconstitution of organisation or branch etc (1) Declaration by Commission of dysfunction, misconduct or vacancy in offices The Minister, a State organisation or any other person having a sufficient interest in relation to an organisation may apply to the Commission for any of the following declarations: (a) a declaration that the organisation or a part of the organisation, including: (i) a branch or part of a branch of the organisation, or (ii) a collective body of the organisation or a branch of the organisation, has ceased to exist or function effectively and there are no effective means under the rules of the organisation or branch by which it can be reconstituted or enabled to function effectively, (b) a declaration that a collective body of the organisation or one or more officers of the organisation are alleged to have engaged, or have engaged, in gross misconduct in relation to the carrying out of their functions or in relation to the organisation, (c) a declaration that an office or position in the organisation or a branch of the organisation is vacant and there is no effective means under the rules of the organisation or branch to fill the office or position. (2) Without limiting subsection (1), gross misconduct includes any conduct that may constitute a serious offence within the meaning of Division 6 of this Part. (3) Interim appointment of administrator If an application is made under this section, the Commission may, by order made no later than 3 months after the commencement of this section, appoint an administrator for the organisation the subject of the application if it is of the opinion that: (a) it is likely that the basis for a declaration under this section will be established by the application, and (b) it is in the interests of members of the organisation or in the interests of justice that an administrator be appointed pending the determination of the application. (4) If the Commission fails to make an order under subsection (3) in relation to the appointment of an administrator for the organisation within 28 days of an application for a declaration under subsection (1), the Minister may exercise the functions of the Commission under this section with respect to the appointment of an administrator if the Minister is of the opinion that: (a) it is likely that the basis for a declaration will be established by the application for the declaration or if a declaration has been made by the Commission, and (b) it is in the interests of the members of the organisation or in the interests of justice that an administrator be appointed pending the approval of a scheme under this section. To avoid doubt, a decision of the Minister under this section may be subject to judicial review by the Supreme Court. (5) An administrator appointed under subsection (3) or (4) has, during the term of office of the administrator and to the exclusion of any other person, the function of the conduct and management of the affairs of the organisation or such of those functions as may be specified in the order. (6) An administrator appointed under subsection (3) or (4) holds office until the application under this section is determined or for such shorter term as the Commission may, by order, specify. (7) If an administrator is appointed under subsection (3) or (4), any office holders of the organisation are suspended from office for the term of the administration. (8) Order for scheme and administrator by Commission If the Commission makes a declaration under this section, the Commission may, by order, approve a scheme for the taking of action by the organisation, a collective body of the organisation or a branch of the organisation, or by an officer or officers of the organisation or a branch of the organisation: (a) for the reconstitution of the branch, the part of the branch or the collective body, or (b) to enable the organisation, branch, the part of the branch or the collective body to function effectively, or (c) for the filling of the office or position. A scheme may include the appointment of an administrator for the organisation. (9) If an order is made under this section, the Commission may give any ancillary or consequential directions it considers appropriate. (10) Despite any other provision of this section, in any order made under this section the Commission may direct that specified officers are to remain as officers of the organisation or a branch of the organisation for the purposes of giving effect to any scheme or other action taken under this section or of enabling the organisation to function effectively. (11) Limits on order-making power The Commission must not make an order under this section unless the Commission is satisfied that the order would not do substantial injustice to the organisation or any member of the organisation. (12) The Commission must not approve a scheme involving provision for an election for an office unless the scheme provides for the election to be held by a direct voting system or a collegiate electoral system. (13) Notice of applications or orders The Commission may determine: (a) what notice is to be given to other persons of the intention to make an application or an order under this section, and (b) whether and how the notice should be given or served and whether it should be advertised in any newspaper. (14) Orders and directions to have effect despite rules of organisation An order or direction of the Commission under this section, and any action taken by an administrator or other person in accordance with the order or direction, has effect despite anything in the rules of the organisation or a branch of the organisation. The terms of s 290D should also be mentioned. That provision is as follows: Liability relating to administration (1) Any matter or thing done or omitted to be done by an administrator appointed under this Division for a State organisation, or a person acting under the direction of the administrator, does not, if the matter or thing was done or omitted in good faith for the purpose of executing this or any other Act, subject the administrator or person so acting personally to any action, liability, claim or demand. (2) Neither the State nor the Minister is liable for anything done or omitted to be done by or on behalf of an administrator appointed for a State organisation under this Division, whether or not the administrator is so liable. 37 Despite the substantial similarity between the Commonwealth Registered Organisations Act and the State Industrial Relations Act for present purposes, there are at least two differences of significance. First, the State Industrial Relations Act expressly provides for the "interim appointment" of an administrator (s 290B(3)). Second, the State Industrial Relations Act expressly provides that any administrator appointed under the Act has an immunity from liability (s 290D).

QUESTIONS OF STANDING - THE PARTIES AND INTERVENERS 47 The applicants in the two remaining proceedings before the Court are: Mr Christopher Brown and other members of the Federal Union in the proceeding commenced on 2 May 2012 (NSD621/2012); and The State Union in the proceeding commenced in the Industrial Relations Court of New South Wales that was transferred to this Court (NSD735/2012). The parties to those two proceedings are those applicants and the named respondents. 48 It is also the case that: although the Federal Minister has discontinued the proceeding he instituted in this Court, he has intervened in both proceedings that remain on foot and has thereby been afforded the opportunity to lead evidence and make such submissions as were considered appropriate; the New South Wales Minister for Finance and Services ('the State Minister) was initially named as an interested party in the proceedings that were cross-vested to this Court and sought to appear in the proceedings commenced by Mr Brown as amicus curiae. There was no opposition to him doing so. "The hearing of an amicus curiae is entirely in the court's discretion": Levy v Victoria (1997) 189 CLR 579 at 604-605 per Brennan CJ. The written outline of submissions that had been filed by the State Minister indicated that no significant extra time or costs would be incurred if he were granted leave to appear: cf. Attorney-General for the Commonwealth v Breckler [1999] HCA 28 at [103], 197 CLR 83 at 134 per Kirby J. His presence kept the Court informed as to whether the State Minister was giving consideration to the exercise of such residual powers as he may have retained pursuant to s 290B(4) of the State Act; and Unions NSW had intervened in the State proceeding prior to it being cross-vested to this Court. All participants were legally represented up until 8 June 2012. On that date Ms Jackson withdrew her instructions to both her solicitors and Counsel. On the final day of the hearing Senior Counsel, who had at first announced his appearance on behalf of the State Union, Mr Peter James Mylan and a number of the Respondents named in Mr Brown's Application, informed the Court that he then only appeared for the State Union. He also appeared for Mr Mylan for the limited purpose of making an application to have him removed as an Applicant in the cross-vested proceeding. 49 By discontinuing his Application, the Federal Minister removed any need to resolve the ambit of the statutory expression "any person having a sufficient interest" as employed in s 323(1) of the Commonwealth Registered Organisations Act. That phrase (and similar phrases) are employed in many provisions as a means of identifying those who may make an application: eg, Federal Court Rules 2011 (Cth) r 24.15, Uniform Civil Procedure Rules 2005 (NSW) r 33.4, NSW Trustee and Guardian Act 2009 (NSW) s 41. 50 It is a phrase which must nevertheless be construed in the particular statutory context in which it is employed: cf. Health World Ltd v Shin-Sun Australia Pty Ltd [2010] HCA 13 at [21], 240 CLR 590 at 597 per French CJ, Gummow, Heydon and Bell JJ. 51 Reservation was initially expressed during the course of several directions hearings held prior to the commencement of the hearing on 5 June 2012 as to whether or not the Federal Minister had a "sufficient interest" to seek the relief sought in his Originating Application. That reservation was expressed notwithstanding the fact that the Minister was the Minister responsible for the administration of the Commonwealth Registered Organisations Act. Cause to question such a conclusion, however, sprang from the fact that the Commonwealth Registered Organisations Act expressly recognises the role of the Minister in two ways, namely by conferring: express power to make an application (eg, ss 28 and 310(2)); and general power to intervene in an existing proceeding (s 351A). In the absence of an express grant of standing in s 323(1), the conclusion is potentially open that the Minister does not fall within the expression "other person having a sufficient interest". Where the legislature contemplates that the Minister may make an application, upon this approach, it expressly so provides. Thus, for example, s 28(1) provides that an "organisation or person interested, or the Minister, may apply to the Federal Court for an order…". Albeit in the context of an application being made to Fair Work Australia, s 30(1)(a) provides that Fair Work Australia "may cancel the registration of an organisation … on application by an organisation or person interest or by the Minister …". 52 No comparable problem arises in respect to the State Industrial Relations Act - s 290B expressly provides that the "Minister, a State organisation or any other person having a sufficient interest … may apply". 53 The necessity to resolve any question as to the standing of the Minister to make an application pursuant to s 323 disappeared, however, when the Minister discontinued his own proceeding. 54 The Minister's right to intervene, by way of contrast, is not in question. It is a right conferred by s 351A of the Commonwealth Registered Organisations Act which provides as follows: Minister's entitlement to intervene (1) The Minister may intervene on behalf of the Commonwealth in proceedings before a court (including a court of a State or Territory) in relation to a matter arising under this Act if the Minister believes it is in the public interest to do so. (2) If the Minister intervenes, the Minister is taken to be a party to the proceedings for the purposes of instituting an appeal from a judgment given in the proceedings. (3) A court may make an order as to costs against the Commonwealth if: (a) the Minister intervenes under subsection (1); or (b) the Minister institutes an appeal from a judgment as referred to in subsection (2). An entitlement to intervene is conferred in like terms by s 569 of the Fair Work Act 2009 (Cth). Given the Minister's statutory right to intervene in the proceeding otherwise being pursued by Mr Brown and others, the decision of the Minister to seek leave to discontinue is to be commended. That course removed from the dispute a question which became unnecessary to resolve. 55 The right to be heard in the proceedings, however, was not confined to those already mentioned. 56 Section 323(5) of the Commonwealth Registered Organisations Act provides that the Court "may determine … what notice … is to be given to other persons". Pursuant to orders made on 3 May 2012, advertisements were placed in The Australian, The Herald Sun and The Daily Telegraph on Monday 7 May 2012. 57 At the directions hearing held on 11 May 2012 the Commonwealth Bank of Australia foreshadowed that it may wish to be heard. The bank did not enter any further appearance at subsequent directions hearings or when the proceedings were called on for hearing on 5 June 2012. 58 During the course of the hearing the Court was also informed that Mr Robert Morrey and Ms Katrina Hart also wished to be heard. They both claimed to be members of the Federal Branch and the State Union. Mr Morrey briefly addressed the Court on 7 and 8 June 2012. He indicated to the Court that he did not wish to adduce any evidence - but he did wish to make a written submission. Given that the very purpose of providing "notice" pursuant to s 323(5) is presumably to alert interested persons of the applications being made, it was considered appropriate to entertain his submission. It was not considered necessary that he be joined as a party to either of the proceedings or that he formally seek leave to intervene. Mr Morrey was unable to attend the resumed hearing on 15 June 2012 - but Ms Hart attended with Ms Julia Batty. Whether Ms Batty was a member was not explained, but, with Ms Hart, she provided what were described as "written submissions" and also advanced short oral supplementary submissions. Notwithstanding the statement previously made by Mr Morrey, Ms Batty did in fact seek to tender evidence. The evidence was rejected. 59 The other parties took further objection to: some parts of the "written submissions" on the grounds that some parts proceeded from a factual basis which was not supported by the evidence; whether Mr Morrey, Ms Hart and Ms Batty were authorised to speak on behalf of the "rank and file members" of the Federal Branch and the State Union or some part of that group and, indeed, whether their submissions were in fact representative of the views of the persons they were purporting to speak on behalf of; and some parts of the written submissions that were said to be directed to issues which were irrelevant to those before the Court. No explanation was provided by either Mr Morrey or Ms Batty as to why they did not seek to be heard at the earlier directions hearing held on 11 May 2012. Had they then indicated their desire to be heard, some of the objections made at the hearing could have been addressed and hopefully resolved. Considerable reservation must thus be expressed in the manner in which these further "submissions" are to be entertained.

CEASED TO FUNCTION EFFECTIVELY 60 Section 323(1) of the Commonwealth Registered Organisations Act and s 290B(1)(a) of the State Industrial Relations Act refer to whether an "organisation or a part of the organisation" has "ceased to function effectively". 61 For the purposes of the present proceedings, and subject to one reservation, all parties (at least initially) tendered an Agreed Statement of Facts. That Agreed Statement of Facts provided in relevant part as follows: Background to the Union 1. The following facts are agreed for the purposes of the proceedings. 2. To the extent that it may be relevant, there is not agreement between the parties as to the cause of, and responsibility for, the fact that the HSU Branch and HSUeast have ceased to function effectively. … Dysfunction 16. The HSU East Branch and HSUeast have ceased to function effectively. 17. The facts set out below apply equally to the HSU East Branch and HSUeast, except where otherwise stated. 18. References below to the Executive Committee and Union Council are references to those bodies in each of the HSU East Branch and HSUeast. References to the Union are references to the HSUeast and HSU East Branch collectively. 19. On 22 September 2011 Michael Williamson took leave from his role as General Secretary of the HSU East Branch and HSUeast following allegations of misconduct including financial impropriety. 20. Since around September 2011, the Executive Committee and the Union Council have been split along partisan lines broadly reflecting State divisions. Antagonism between the two groups has meant that these bodies have ceased to function effectively as the bodies responsible for the government, management and control of the affairs of the Union. 21. The Union Council and the Executive Committee are not presently able to operate in a way which enables them to: (a) oversee financial management of the HSU East Branch and HSUeast; (b) draw accurate accounts of the finances of the HSU East Branch and HSUeast; (c) effectively conduct business at meetings of the HSU East Branch and HSUeast. 22. The HSU East Branch and HSUeast have not implemented effective financial control measures. 23. The governing bodies of the HSU East Branch and HSUeast have not been able to conduct their business in an orderly and timely way. 24. Meetings of the governing bodies of the HSU East Branch and HSUeast have been disrupted and in some cases abandoned. 25. Since at least September 2011, meetings of the Union Council have been disorderly and disruptions have prevented the orderly and proper transaction of business. 26. Votes on contentious issues since at least September 2011 have been split between delegates who reside in New South Wales and delegates who reside in Victoria, with very few delegates voting inconsistently with that pattern. 27. Officers of the HSU East Branch and HSUeast are deflected and distracted from the pursuit of the industrial interests of their members. 28. Elected representatives from New South Wales have since September 2011 either ceased to attend, or have attended less frequently, the Victorian offices of the HSU East Branch. 29. The resources of the HSU East Branch and HSUeast have been diverted away from representing industrial issues of members. 30. Final recruitment decisions in Victoria must be authorised by the General Secretary of the HSU East Branch and HSUeast, who is New South Wales based. 31. The rate of resignations of members of the Union has significantly increased since September 2011. 32. The HSU and HSUeast have been suspended from their respective affiliations with the ACTU, Unions NSW and the Victorian Trades Hall Council. Adverse publicity, to which those actions added, has damaged the reputations of both the HSU and HSUeast. 33. Various members, mostly from NSW, have called on members of the Executive Committee to stand-down and for an administrator to be appointed in their stead 34. The issues affecting the HSU East Branch and HSUeast have had a negative impact on the ability of other branches of the HSU to operate effectively 35. The Union has been unable to effectively investigate complaints and allegations of misconduct made in respect of officers. 36. On 23 September 2011 the Union Council of HSUeast resolved that an Independent Panel of Experts review and investigate certain matters in connection with HSUeast. 37. The HSU East Branch and HSUeast have failed to put controls and procedures in place to ensure accountability and proper governance in relation to the expenditure of members' funds including the failure to prepare and implement: (a) a procurement policy; (b) tenders for large supply agreements; (c) contracts for large supply agreements; (d) pricing comparisons; (e) a formal purchase order system; (f) a credit card policy; (g) budgetary controls; (h) payment controls; and (i) segregation of duties. 38. It is necessary for an administrator to be appointed in order to allow (a) imposition of proper fiscal controls; and (b) orderly management and operation of the HSU East Branch and HSUeast. The one reservation is that Mr Williamson did not agree to paragraphs [19], [22] and [37]. 62 Particular emphasis can presently be placed upon paragraph [16] of the Agreed Statement of Facts. 63 The Agreed Statement of Facts was tendered and reliance was placed upon s 191 of the Evidence Act 1995 (Cth). That section provides as follows: Agreements as to facts (1) In this section: agreed fact means a fact that the parties to a proceeding have agreed is not, for the purposes of the proceeding, to be disputed. (2) In a proceeding: (a) evidence is not required to prove the existence of an agreed fact; and (b) evidence may not be adduced to contradict or qualify an agreed fact; unless the court gives leave. (3) Subsection (2) does not apply unless the agreed fact: (a) is stated in an agreement in writing signed by the parties or by Australian legal practitioners, legal counsel or prosecutors representing the parties and adduced in evidence in the proceeding; or (b) with the leave of the court, is stated by a party before the court with the agreement of all other parties. Even though a fact may be "agreed", it should be recalled that an "agreed fact" need not be accepted by the Court as true: Minister for Environment, Heritage and the Arts v PGP Developments Pty Ltd [2010] FCA 58 at [35], 183 FCR 10 at 20 per Stone J. Her Honour repeated the same view subsequently in Australian Competition and Consumer Commission v Korean Air Lines Co Ltd [2011] FCA 1360 at [4]. See also: Australian Competition and Consumer Commission v MSY Technology Pty Ltd [2011] FCA 382 at [4], 279 ALR 609 at 611 per Perram J. These observations of his Honour were not the subject of further comment on appeal: Australian Competition and Consumer Commission v MSY Technology Pty Ltd [2012] FCAFC 56. Nor does s 191 "… prescribe the weight that is to be given to [agreed facts]": Secretary, Department of Health and Ageing v Prime Nature Prize Pty Ltd (in liquidation) [2010] FCA 597 at [5] per Stone J. 64 In addition to the Agreed Statement of Facts there were a number of further Affidavits which addressed factual matters in respect to which there was apparently no agreement as well as supporting those facts which were agreed. The Agreed Statement of Facts, the further Affidavits and submissions were all included in a Court Book which was jointly tendered and marked as a single exhibit. No application was made by any party to cross-examine any of the deponents of any of the further Affidavits included within the Court Book. Other than the reservation expressed by Mr Williamson, no leave was initially sought by any party, pursuant to s 191(2) of the Evidence Act to contradict or qualify any agreed fact. Given the absence of any application to cross-examine, and the consequential acceptance of the facts addressed in those Affidavits, it was perhaps curious that the Agreed Statement of Facts was not more extensive. But that matters not. The Court Book also included the outlines of written submissions that had been filed by the parties. In the absence of any cross-examination, oral submissions commenced late-morning on 6 June 2012. 65 Given that the Agreed Statement of Facts was the subject of agreement when all parties or interveners were represented, there was perhaps no reason to go behind the agreement that had been reached. The Affidavits which were contained within the Court Book were nevertheless independently reviewed because: the attention which the proceedings had attracted was such that those persons interested in the ultimate outcome (including the members of the Federal Branch and the State Union) could be thereby given some assurance that that outcome was not being dictated by one or other of the parties but was instead being independently considered; some misgiving was felt at the prospect of granting declaratory relief solely based upon agreed facts; and, albeit a consideration which only emerged on 8 June 2012 when Ms Jackson withdrew her instructions from her existing legal representatives and thereafter sought an adjournment, because: it was considered prudent to at least have some appreciation of whether an opportunity for Ms Jackson to belatedly cross-examine the deponents of Affidavits and possibly to have herself adduced additional evidence would have had any significant impact upon the conclusions to be reached. The other evidence contained within the Court Book only provided ample support for the matters contained in the Agreed Statement of Facts. 66 The Agreed Statement of Facts and the Affidavits, it is concluded, are more than sufficient to found a declaration that both the Federal Branch and the State Union have "ceased to … function effectively". In reaching this conclusion it has not been considered necessary to traverse or resolve the competing factual allegations and issues which divide the opposing parties. It is highly unlikely that any cross-examination by Ms Jackson of any of the witnesses, even if an adjournment been granted to enable her to do so, would have led to any different conclusion. The mere fact of division between the opposing parties and the consequential inability of the Federal Branch and the State Union's governing bodies to "function effectively", would not have been displaced by cross-examination. Indeed, any cross-examination may well have only further entrenched the opposing factions and provided further reason for concluding that the Federal Branch and the State Union had "ceased to … function effectively". 67 It has been unnecessary to resolve whether one or other of the opposing parties is justified in the position for which they advocate. 68 It is the very fact of division - or the agreed "antagonism" - between the opposing parties which inevitably leads to a conclusion that both the HSU East and the State Union have ceased to "function effectively".

NO EFFECTIVE MEANS UNDER THE RULES 69 Section 323 of the Commonwealth Registered Organisations Act requires that there be "no effective means under the rules of the organisation by which it can be reconstituted or enabled to function effectively" (s 323(1)(a)) and there being "no effective means under the rules of the organisation or branch to fill the office or position" (s 323(1)(b)). Section 290B(1)(a) and (c) are the counterpart provisions in the State Industrial Relations Act. 70 The former s 171D(1)(b) of the Conciliation and Arbitration Act was the predecessor provision to s 323(1)(b) of the Commonwealth Registered Organisations Act. The reference in both provisions to there being "no effective means under the rules of the organisation" serves to emphasise the importance of leaving it to the members to devise rules to themselves resolve an issue or dispute that has arisen. An instance of the Court not being satisfied that rules did not provide an "effective means" of filling an "office or position" within the meaning of s 171D(1)(b) was provided by Adams v Hill (1984) 3 FCR 138. In that case, and after setting out the terms of s 171D, Wilcox J went on to conclude as follows: There are two difficulties, arising out of the wording of the section, in granting the relief sought by the Union and Mr Kidd. The form of declaration which the court is empowered to make under subs. (1) - and which is the foundation of a scheme under subs. (2) - is that particular offices or positions are vacant "and there are no effective means under the rules of the organisation to fill the office(s) or position(s)". It is not possible to make that declaration in this case. Vacancies do exist, for the nine offices or positions of delegates to the ALP State Council, but there are effective means under the rules of the organisation to fill those vacancies. Recognising this, the applicants seek a declaration that there are no means of filling the vacancies before 11 August 1984. This is unfortunately now true, but the section does not contemplate a declaration in those terms. The section is clearly designed to resolve a problem caused by a hiatus in the rules, not a problem caused by the fact that relevant office-bearers have neglected to take action to fill vacancies at the time most appropriate to the efficient operation of the organisation. The extension of the section to cover such cases would represent a significant inroad upon the entitlement of members to have the organisation governed in compliance with the rules. [(1984) 3 FCR at 142] 71 Section 323(1)(a) - and the state counterpart s 290B(1)(a) - share the common requirement that there be "no effective means under the rules" and are to be construed in a like manner to the former s 171D(1)(b). It remains important to leave it to the members to resolve a dispute where possible. 72 The Agreed Statement of Facts did not contain any agreement as to there being no "effective means under the rules" - presumably because such a conclusion was seen by the parties as one to be drawn from the relevant rules. It is nevertheless concluded that there are no "effective means under the rules" whereby the difficulties which have emerged can be adequately addressed. 73 A number of considerations lead to this conclusion. 74 First, under the rules of the Federal Union (which govern the Federal Branch) no provision is made for the holding of "early elections". Rule 29 provides that "[e]lections shall take place in 2010 and each four years thereafter…". The rules do not contemplate or enable an election to be held prior to 2014. 75 Second, there are no means whereby an officer of the Federal Union may be removed from office. Rule 37 of the rules of the Federal Union thus provides as follows: 37 - REMOVAL OF OFFICERS ETC. (a) An Officer of the Union or a member of National Council or National Executive may be removed from his/her office if the National Council of National Executive by majority resolution of members voting finds him/her guilty, in accordance with these Rules, or misappropriation of the funds of the Union or any Branch thereof, a substantial breach of the Rules of the Union, gross misbehaviour or gross neglect of duty or finds that he/she has ceased, according to these Rules, to be eligible to hold his/her office. Any charge shall be in writing and shall be forwarded to the National President or the National Secretary, who shall notify the person charged of the details of the charge. (b) Such person may be charged by any member under this Rule and such a matter should in the first instance be dealt with by the Union's Ombudsman under rule 17. Until the Ombudsman has completed their investigation charges shall not be laid. Once the Ombudsman's findings have been presented the person/s laying the charge have seven days to consider whether they wish to proceed with the matter. (c) The person charged shall be given not less than fourteen days' notice in writing of the time and place of the meeting at which the charge is to be heard and determined and shall be entitled to attend such meeting and to be heard but not to vote thereat. (d) A member so removed by the National Executive shall have the right to appeal to the National Council provided that he/she gives to the National Secretary notice of his/her intention to appeal within seven days of his/her being notified in writing of his/her removal, but the giving of such notice shall not operate to stay the decision of the National Executive. (e) Notwithstanding the foregoing, either the National President or the National Secretary may, in their discretion, suspend from office a person charged under this rule pending determination of the charge but in no event shall a person remain suspended for a period exceeding twenty-eight days. (f) A person shall be ineligible to hold office as an office as an officer of the Union or member of the National Council or National Executive if: (i) he/she becomes of unsound mind; or, (ii) he/she ceases to be a financial member of the Union. The reference to the role of "the Union's Ombudsman under rule 17" can presently be left to one side. Of present relevance is the degree of influence that the members of the HSU East Branch exert on the National Executive. The members of the Federal Branch effectively control the Federal Union due to their numerical dominance on the National Council. By way of illustration, the HSU East Branch was entitled to 35 delegates to the National Council as at December 2011 and all other Branches combined were entitled to 33. 76 Third, there is a legitimate concern as to whether the July 2010 amendments to the rules of the State Union are valid. In his written submissions originally filed in the Industrial Court of New South Wales, the Federal Minister contended (inter alia) that s 217(1)(a) of the State Industrial Relations Act confines the organisations of employees who are entitled to registration under that Act to organisations of employees in New South Wales. No "practical industrial purpose", the Federal Minister contended, is served by admitting persons from one state as members in an industrial organisation registered in a different state. The Federal Minister ultimately submitted that no amendment of the rules of the State Union could "allow for the enrolment of members from outside of NSW and the participation of those members in the governance of the State Union". 77 There is no need to resolve this submission. It is sufficient, for present purposes to conclude that the fact that a serious question has been raised as to the validity of the rules of the State Union is a further reason to doubt the capacity of the existing rules to enable the State Union and the Federal Branch to function effectively. 78 One final aspect of the existing rules should also be briefly mentioned. In the proceedings commenced by Ms Jackson on 20 April 2012 declaratory relief was sought as to the correct construction of r 51A(iii) of the Federal Union rules (and consequently, r 15(3) of the State Union rules). Both rules are in identical terms and provide: All of the members of the Council shall have a vote on the Council except for the Divisional Secretaries, the Assistant Divisional Secretaries and any other employees of the Branch who hold office. Of particular concern is the phrase "employees of the Branch who hold office". 79 Although Ms Jackson discontinued her proceeding, a genuine dispute over the correct construction of those rules remains. Whether a person is an "employee of the Branch" affects that person's entitlement to vote on the Union Council. One of Ms Jackson's contentions in the discontinued proceeding was that all of the Organisers who were elected to the Union Council were not entitled to vote "on the Council" because they are "employees of the Branch who hold office". All of those organisers, it was said, are "employees of HSUeast and are paid a full time salary". A further issue that was to be raised in those proceedings was whether r 15(3) was contrary to s 235(1)(a) and/or (c) of the State Industrial Relations Act and whether r 51A(iii) was contrary to s 142(1)(a) and/or (c) of the Commonwealth Registered Organisations Act. 80 The principles to be applied in resolving these competing submissions may well have been common ground. 81 It may well have been accepted that the Court should adopt a "generous, non-restrictive or liberal approach" when interpreting the rules of an industrial organisation: Shaw, 'Interpreting Trade Union Constitution Rules' (1988) 62 Australian Law Journal 690 at 691. Mason J, for example, when considering whether persons were engaged in "the business of insurance" and hence eligible to be members of the Australian Insurance Employees' Union, in R v Cohen; Ex parte Motor Accidents Insurance Board (1979) 141 CLR 577 at 587 observed: In considering whether the Board is engaged in "the business of insurance", it should be recognized at the outset that we are concerned with the use of that expression in the eligibility clause of a trade union's registered rules. The expression is, in such a context, no doubt intended to have a wide meaning and it should be interpreted and applied in accordance with its ordinary and popular denotation rather than with some narrow or formal construction. Thus the question is whether, as a matter of ordinary usage, the Board can properly be said to be in "the business of insurance". It should be also borne in mind that eligibility rules "will have been drawn, more likely than not, by union officials more familiar with the practical affairs of industry than with the niceties or subtle nuances of language": R v Aird; Ex parte Australian Workers' Union (1973) 129 CLR 654 at 659. "It is well settled that union eligibility rules are to be interpreted liberally and according to their ordinary and popular meaning": Re Anti-Cancer Council of Victoria; Ex parte State Public Services Federation (1992) 175 CLR 442 at 448 per Mason CJ, Brennan and Gaudron JJ. The context in which the terms of a union rule are to be construed also extends to the historical past from which the rule emerged: cf. Short v F W Hercus Pty Limited (1993) 40 FCR 511 at 517-518 per Burchett J. 82 With reference to the argument founded upon s 142(1)(c) of the Commonwealth Registered Organisations Act and s 235(1)(c) of the State Industrial Relations Act, both provisions require that a rule not be "oppressive, unreasonable or unjust". Submissions filed by the Respondents indicated that it was going to seize upon the consequences of the New South Wales organisers not being entitled to vote. Such consequence, it was to be argued, would be that the "rules would be unrepresentative and/or undemocratic". Such a result, it was to be contended, provided further reason for rejecting the construction of the rules urged by Ms Jackson or provides the basis upon which a conclusion should be reached that the rules are contrary to s 142 of the Commonwealth Registered Organisations Act or s 235 of the State Industrial Relations Act. 83 In respect to the former s 140(1)(c) in Municipal Officers' Association of Australia v Lancaster (1981) 54 FLR 129 at 164-165 Deane J concluded that the phrase "oppressive, unreasonable or unjust" was used objectively and that no mandate was conferred upon a Court to simply rewrite rules by reference to what it perceived to be "preferable, desirable or ideal". His Honour there observed: The constraints and restrictions imposed, by positive and negative requirements of the Act and regulations, upon the freedom of the members of an organization to select, for themselves, the rules which they consider appropriate for their particular organization, are real and significant. It cannot, however, be too strongly stressed that, subject to those constraints and restrictions, the content of the rules of a registered organization is primarily a matter for the members …This Court has no authority generally to supervise the content of the rules or to require that the rules comply with what those constituting the court might see as preferable, desirable or ideal. To put the matter differently, it is for the members, or those entrusted by the members in that regard, to decide the content of the rules. The function of this Court is to determine, in accordance with ordinary judicial procedure, whether some provision or provisions of the rules adopted by, or on behalf of, the members can properly be described not merely as undesirable but as oppressive, unreasonable or unjust … There is nothing in the context of s. 140 (1) (c) which would justify giving an expansive construction of the requirement that the conditions, obligations or restrictions imposed by the rules of an organization upon applicants for membership or members not be "oppressive, unreasonable or unjust". Those three words are used objectively in the clause and each of them is to be given its ordinary strong meaning. Plainly, their meanings overlap and definition is liable to adulterate the strength which the words possess. Nonetheless, it seems desirable that I indicate the meaning which I ascribe to them. To be oppressive, a condition, obligation or restriction must be burdensome, harsh and wrongful … To be unreasonable, it must be immoderate and inappropriate. To be unjust, it must be contrary to right and justice and to ordinary standards of fair play … These observations were approved by Smithers, Keely and Wilcox JJ in Moffitt v Vehicle Builders Employees' Federation of Australia (1985) 11 IR 174 at 175. Similar words were employed in s 196(c) of the Workplace Relations Act 1996 (Cth) and were similarly construed: Woolgar v O'Neill [2001] FCA 1149 at [34], 108 IR 58 at 64 per Sackville J; Kingham v Sutton (No 3) [2001] FCA 1117 at [58] per Goldberg J. See also: Fegan v Jackson [2009] FCA 319 at [31], 183 IR 292 at 301 per Kenny J. 84 Also with reference to the former s 140(1)(c), the Full Court in Doyle v Australian Workers' Union (1986) 12 FCR 197 at 205-206 Evatt, Sheppard and Gray JJ observed: The starting point of any s 140 case is the right of an organisation to choose its own rules and internal structures, within the framework provided by the Act. This right has been referred to so often in recent authorities that it is unnecessary to examine it in detail. … The primary justification for the existence of a rule of an organisation is simply that the organisation has adopted that rule. It is then necessary to apply s 140(1)(c) to the particular provision, measuring its effect. The Act assumes that the rules of an organisation may impose conditions, obligations or restrictions which are not oppressive, unreasonable or unjust. The mere imposition by the rules of conditions, obligations or restrictions is not evidence that those conditions, obligations or restrictions, are oppressive, unreasonable or unjust. Their effect must be examined, in the particular circumstances of the organisation, and by reference to both the objects of the Act, and the purposes of the registration of organisations under the Act. … 85 The same approach may well have been adopted with respect to the same phrase as now employed in s 142(1)(c) in the Commonwealth Registered Organisations Act. 86 With reference to the current s 142(1)(c), Perram J in Gray v Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia [2012] FCA 380 expressly referred to the observations of Deane J in the Municipal Officers Association case but nevertheless more pragmatically observed: [16] There may be little to be gained in seeking to parse an expression such as 'oppressive, unreasonable or unjust', for there comes a point in every process of legal reasoning when the time for further discussion of what a statute means must end and the time for the application of the standard posited by it to the facts as found must begin. There may be much to be said for the view that, in many cases, the mere glossing of a statute may not only be ultimately unenlightening but, worse, may carry with it a significant risk of error and confusion. Exchanging the words used by Parliament for other judicially discerned synonyms not only runs the risk of engaging in a legal game of Chinese whispers, but distracts attention from the task at hand … There may well be much to be said for his Honour's pragmatism; but there may also be much to be said for gleaning such guidance as may be discerned from the earlier decisions. Those authorities serve to emphasise the objective character of the analysis to be undertaken when applying the current s 142(1)(c) and the absence of any general authority conferred upon a Court to supervise the content of the rules of an organisation to impose what it may perceive to be a more "preferable, desirable or ideal" rule. 87 Notwithstanding such an approach to the construction of r 15(3) of the State Union and r 51A(iii) of the Federal Branch - the issues that would have been raised in Ms Jackson's proceeding were not susceptible of an easy answer. Any uncertainty as to the meaning of rules governing a Council member's entitlement to vote and any uncertainty as to the validity of those rules necessarily provide a further potential basis upon which future decisions may be vitiated - or, at least, challenged. 88 Uncertainty as to the correct construction of r 15(3) of the State Union rules and r 51A(iii) of the Federal Union rules only serves to contribute to a conclusion that there are no effective means of enabling the Federal Branch or the State Union to function effectively.

A DECLARATION BASED UPON AGREED FACTS? 89 Power is conferred upon the Court to grant declaratory relief by both s 21 of the Federal Court of Australia Act 1976 (Cth) and (more immediately) by s 323(1) of the Commonwealth Registered Organisations Act. Section 290B(1)(a) and (c) of the State Industrial Relations Act is relevantly expressed in the same terms as s 323(1). 90 The form of declaration authorised by ss 323(1) and 290B(1) may be curious; they may fall short of what may otherwise be regarded as a "declaration of right": cf. Sankey v Whitlam (1978) 142 CLR 1 at 23 per Gibbs CJ. 91 On one view the form of declaration is more akin to a declaration of fact. But such is the form of the power conferred upon this Court by statute. In Joske (supra), Mason and Murphy JJ expressly referred to the factual matters that were the subject of the inquiry prompted by an application under s 171D of the Conciliation and Arbitration Act and concluded that such issues were "issues of fact well suited to judicial determination": (1976) 135 CLR at 218. 92 Power to grant declaratory relief is also addressed by s 21 of the Federal Court of Australia Act. The appropriateness of making of declarations either by consent or upon the basis of an agreed statement of facts has been canvassed in many authorities. No party or intervener argued that the two proceedings now before the Court did not raise a "matter" within the meaning of Chapter III of the Constitution. See: Allseas Construction S.A. v Minister for Immigration and Citizenship [2012] FCA 529 at [19]-[29] per McKerracher J. 93 On the one hand it is recognised that it is not the Court's function to impede settlements to litigation, especially in circumstances where the parties are represented: Australian Competition and Consumer Commission v Real Estate Institute of Western Australian Inc [1999] FCA 18, 161 ALR 79. French J there observed: [1] The cost and delays involved in the litigation process are notorious. Fortunately, only a small proportion of proceedings commenced actually go to trial and judgment. The great majority is settled one way or the other. As a general principle fair and appropriate settlements are encouraged to reduce the burden of litigation on both public and private resources. Courts are frequently asked to play their part by accepting formal undertakings or making orders by consent which prohibit parties from certain conduct or require them to do certain things. Sometimes they are asked to impose agreed pecuniary penalties. In carrying out those functions, courts are conscious of the public interest in the settlement of cases. They must also be conscious, however, that the laws they apply are public laws. It is in the public interest that, in considering agreements between parties requiring orders of a court, the court does not act as a mere rubber stamp. What is proposed must always be scrutinised to determine whether undertakings or consent orders are within power and are appropriate. There is sometimes a tension between these components of the public interest as the present case illustrates. … [20] A general principle of judicial restraint in the scrutiny of proposed settlements was enunciated early in the history of the Trade Practices Act. It is not the function of the court to impede settlements between parties legally represented and able to understand and evaluate the desirability of agreeing to a settlement nor to refuse to give effect to terms of settlement by refusing to make orders or accept undertakings where they are within the court's jurisdiction and are otherwise unobjectionable:…. 94 On the other hand, a majority of the Full Federal Court has also held that it is generally undesirable for the Court to grant relief by way of declaratory orders in the absence of any contest on the question: BMI Ltd v Federated Clerks' Union of Australia (NSW Branch) (1983) 76 FLR 141 at 153 per Keely and Beaumont JJ. But it is not required that there be a contest on the question before the court may grant such declaratory relief: Australian Competition and Consumer Commission v MSY Technology (supra) at [30] per Greenwood, Logan and Yates JJ. 95 Whatever position is adopted, "close attention" should be given "… to the form of proposed declarations, particularly those 'by consent'": Rural Press Limited v Australian Competition and Consumer Commission [2003] HCA 75 at [90], 216 CLR 53 at 91 per Gummow, Hayne and Heydon JJ. 96 In the present proceedings, separate and independent consideration has been given to the factual basis underlying the reasons why each of the organisations cannot function effectively. 97 It is concluded that it is appropriate to grant declaratory relief. That conclusion is founded in part upon the Agreed Statement of Facts and in part upon the Affidavits forming part of the Court Book.

THE APPOINTMENT OF AN ADMINISTRATOR? 112 The Agreed Statement of Facts, it will be noted, provided in part agreement as follows: [38] It is necessary for an administrator to be appointed in order to allow (a) imposition of proper fiscal controls; and (b) orderly management and operation of the HSU East Branch and HSUeast. Matters which received specific attention was whether or not there should be a single administrator or one or more administrators and whether any such appointment should be effected by an order of the Court or pursuant to a term of the scheme to be approved. The identity of the person to be appointed also received detailed attention. 113 Section 323 of the Commonwealth Registered Organisations Act confers no express power to appoint an "administrator". Section 323(2) only confers express power to "approve a scheme". Section 323(3), however, confers a discretionary power upon the Court to "give any ancillary or consequential directions it considers appropriate". In limited contrast stands s 290B of the State Industrial Relations Act. That section confers an express power to appoint an administrator (s 290B(3) and (4)) - albeit an interim administrator - and expressly there provides that a "scheme may include the appointment of an administrator". 114 Notwithstanding the lack of an express power conferred by s 323 to appoint an "administrator", the power to do so may be found either within the general power conferred by s 323(2) to "approve a scheme" or within s 323(3) - the discretionary power to "give any ancillary or consequential directions it considers appropriate". Neither the phrase "ancillary or consequential" nor the term "appropriate" are words which should be narrowly construed. The evident legislative purpose expressed in s 323(3) is to confer upon the Court all such powers as it considers "appropriate" to rectify the circumstances which have caused the "part of the organisation" to cease "to function effectively". If it were necessary to find an additional source of power, that power could be found in s 23 of the Federal Court of Australia Act. 115 The considerations to be taken into account when selecting the particular person or persons to be appointed as an administrator have not received attention in the present statutory context. Some guidance, however, may be gleaned from the considerations taken into account by a court when a liquidator is appointed. In Bovis Lend Lease v Wily [2003] NSWSC 467, 45 ACSR 612 Austin J summarised at least some of these considerations as follows: [123] It is now well established that a liquidator must be, and be perceived to be, independent of the company, its directors and shareholders, and individual creditors. The liquidator must act, and be perceived to act, impartially in the discharge of the duties and responsibilities of his or her office. Although the distinction is not always observed, there are in fact separate duties relating to independence and impartiality (absence of bias). 116 In the present statutory context, the only potential express constraint upon the exercise of that power is that the Court must consider that the appointment of an "administrator" is "appropriate": s 323(3). Without attempting to be exhaustive, the factors to be taken into account when exercising the discretionary power would include: the qualifications and expertise of the person to be appointed. Those qualifications and that expertise may vary depending upon the underlying facts and circumstances giving rise to the need to consider making such an appointment. Where a "part of [an] organisation" has ceased to "function effectively" by reason of allegations of the improper expenditure of funds, an administrator with accounting-type expertise may be appropriate; where the allegations are more broadly based and extend to factional infighting and divisions emanating from the very structure of a part of an organisation, different qualifications and expertise may be appropriate. So, too, may those qualifications and experience differ where there is a need to consider the adequacy of the existing rules and the potential to require an amendment to those rules; and the independence, together with the perceived independence, of the person to be appointed. 117 When exercising the discretionary power, it is further concluded that the Court: is not constrained by the names advanced by one or other of the parties. The Court may itself appoint a person of its own choosing; and may appoint, in an appropriate case, one or more administrators. In the present proceedings, it is thus the case that one administrator could be appointed to the Federal Branch and a different person appointed as administrator of the State Union. Where more than one person has been advanced as a person appropriate to be appointed as an "administrator": it is not considered that the task of the Court is to consider in minute detail the relative strengths and weaknesses of each of the persons under consideration. Each of the persons suggested may each be eminently suitable. 118 Whoever may be appointed as administrator, the task of the administrator would be to administer the scheme that has been approved by the Court pursuant to s 323(2). 119 In the present proceedings, two names have been posed for the consideration of the Court, namely: Mr Jeffrey Phillips SC. Mr Phillips is a member of the Inner Bar practising as a barrister primarily in New South Wales. He was admitted to practice in 1981 and appointed Senior Counsel in October 2003. Mr Phillips is proposed by the State Minister and his appointment is supported by Ms Jackson; and The Honourable Michael Moore. Mr Moore is a former Judge of this Court. He retired from this Court in August 2011. He is the person proposed by Mr Brown and his appointment is supported by the Federal Minister and the State Union. 120 The appointment of Mr Phillips is opposed by Mr Brown and the other Applicants on the basis that he cannot be seen to be impartial based on comments he has made in a publication known as Workplace Review. These comments include: • views "… as to the correctness or righteousness of Ms Jackson's actions", describing her as a "whistleblower" and a "brave and strong person" who has been subject to "abuse and innuendo"; • references to the "breathtaking" level of "entertainment expenses" incurred by "some HSU officials"; and • stating a general political opinion that "… the gulf separating union officials and their unions' membership may be a reason that in some areas of the nation more unionists vote for the Liberal National Party than for Labor…". Whether the prior expressions of such views would necessarily disqualify a person from appointment need not be resolved. 121 Although both of these individuals may well be capable and qualified to properly discharge the functions of an administrator, it is considered that the Honourable Michael Moore should be appointed. His long experience in industrial law (both prior to his becoming a Judge of this Court and thereafter) and his considerable experience as a Judge, it is respectfully considered, will well equip him to undertake the tasks entrusted to him in a manner which will be both independent of the interest parties, and be seen (objectively) to be independent. He has indicated his willingness to accept the appointment and will unquestionably be accepted as a person who will bring expertise and independence to the task. 122 It is further concluded that the same administrator should be appointed to both the Federal Branch and the State Union. The affairs of the two entities are so inextricably mixed that it would only create uncertainty and unnecessary complication if different administrators were appointed. 123 A number of different issues which emerged on the last day of the hearing should also be addressed. Two of these issues were: the fact that the Honourable Michael Moore would be unavailable on a number of occasions; and the question as to whether he should have power to appoint a "delegate" to perform his functions (presumably limited to those times when he was otherwise unavailable). The limited number of occasions on which he was to be unavailable, it has been concluded, does not warrant either the appointment of Mr Phillips as the administrator or the appointment of both Messrs Moore and Phillips as joint administrators. Mr Phillips, it was accepted, had greater availability than Mr Moore. Nor did the limited number of occasions on which the Honourable Michael Moore was to be unavailable warrant conferring upon him - even in a manner confined to his first seeking the views of the parties - a power to delegate his functions. His appointment had been the subject of considerable submissions from the parties and it was him that was to be appointed. If an occasion arises when it is prudent to appoint at some future stage for some limited purpose another person as administrator for a limited period, that application can be made if and when such an occasion arises. Any application would presumably give consideration to the extent of the powers and functions sought to be delegated. 124 Two further issues were raised by the solicitor who appeared on the final day of the hearing on behalf of the Honourable Michael Moore in his capacity as the interim administrator. Those two issues were broadly expressed as being: the extent to which the administrator should be involved in "policy" matters, particularly in relation to the Federal Branch; and whether he could appoint a "proxy" to attend, for example, a meeting to be held of the National Council and the National Executive in Perth on 27 and 28 June 2012. The first of these two matters, with respect, can be resolved with little difficulty. Order 13 of the orders made on 8 June 2012 provided (in part) as follows: … The Administrator shall have, and be at liberty to exercise, all of the powers of the Officers of the HSU East Branch under the Rules of the HSU. There is no reason to confine the full ambit of the powers conferred by this order. Those powers would extend to the administrator being at liberty to exercise all of the powers, including those involved in what may broadly be described as "policy". Insofar as the latter issue is concerned, it is concluded that the administrator should have the power to appoint a "proxy" to attend (for example) a conference of the kind identified. Although there may be an uneasy distinction between the status of a person as a "proxy" and that of a "delegate", it is considered that a "proxy" would remain subject to the immediate control and direction of the administrator. A separate concern arose from the terms of clause 41 of the rules of the Health Services Union which provides (for example) that a "National Officer may appoint in writing another member of the National Council as his/her proxy …". Although a "proxy" would not be "another member…", s 323(6) of the Commonwealth Registered Organisations Act would presumably remove any impediment to that "proxy" voting. 125 Clause 5 of the scheme to be now approved is to be likewise construed as conferring the same width of powers upon the administrator. 126 Given the terms of s 290D of the State Industrial Relations Act, the administrator will have an immunity from suit in his capacity as an administrator of the State Union. Insofar as he is appointed as an administrator under the Commonwealth Registered Organisations Act of the Federal Branch, no such statutory immunity exists. The Court has nevertheless been informed by Senior Counsel for the Federal Minister that arrangements have been made which are satisfactory to the Honourable Michael Moore. If any difficulty emerges in this regard, it should be raised with the Court.

VACATION OF OFFICES 127 Whether or not there should be a vacation of all offices was another matter to which particular attention was given in both oral and written submissions. 128 Only Ms Jackson argued that there should not be an immediate vacation of all offices. There was no evidence that any other officer, other than Ms Jackson, opposed the vacation of all offices. 129 But for the opposition of Ms Jackson, it is considered that the vacation of all offices is desirable and necessary. Her opposition, it is further concluded, leads to no different conclusion. 130 Counsel previously appearing on her behalf prior to 8 June 2012 submitted that: neither s 323 of the Commonwealth Registered Organisations Act, nor s 290B of the State Industrial Relations Act, empowered the Court to make an order for the vacation of any office (including Ms Jackson's office) or for the approval of a scheme that provided for any office to be vacated. Counsel further submitted in the alternative that if the vacation of an office or position did fall within the reach of s 323 (and s 290B), Ms Jackson would suffer "substantial injustice" within the meaning of s 323(4) and s 290B(11). In furtherance of this alternative submission, Counsel previously appearing on her behalf contended that: the phrase "substantial injustice" focussed attention on the impact of the vacation of an office upon the office holder to the exclusion of - or (at the very least) to a greater extent than - any impact on the "part of the organisation" under consideration; the onus of demonstrating that Ms Jackson would not suffer "substantial injustice" lay with those who sought to bring about the vacation of her office; and the onus had not been discharged. These submissions, it seemed, proceeded from an assumption that the vacation of the office of Ms Jackson would occasion an "injustice"; the outstanding question being whether such an order would occasion "substantial" injustice. Each of the submissions should be briefly addressed. None of them, with respect, leads to any different conclusion. It is not understood that Ms Jackson sought to withdraw any of these submissions that had been previously advanced. 131 The confined construction of s 323 and s 290B gains some limited support from the terms of s 323(1)(b) (and s 290B(1)(c)) which contemplate that an office or position "is vacant…" as opposed to (for example) a phrase which provided for the "vacating of an office …". Such a narrow construction is rejected. Where it is the very person who occupies "a position" that is the reason or a part of the reason for a "part of the organisation" being dysfunctional, it may strip s 323 of much of its force if the vacation of that office or position could not be effected. Ms Jackson's construction of the provisions is even more difficult to support in the context of the State Industrial Relations Act when the terms of s 290B(1)(b) and the separate reference in that provision to the making of a declaration that a person has engaged in "gross misconduct" are considered. Whilst no such allegation is made in the present proceedings, it would be difficult to construe s 290B(1) as not authorising the vacation of an office of a person who had engaged in "gross misconduct". 132 Assuming that the vacation of an "office or position" did fall within the reach of these provisions, Counsel on behalf of Ms Jackson then turned attention to the meaning of the phrase "substantial injustice" in s 323(4) (and s 290B(11)). Reliance, by way of analogy, was placed on the construction of the same phrase as employed in s 1322 of the Corporations Act 2001 (Cth) and the decision in Super John Pty Ltd v Futuris Rural Pty Ltd [1999] NSWSC 627, 32 ACSR 398. One of the issues that arose in that decision was whether an "irregularity" in a proceeding had occasioned "substantial injustice". Of that expression, Santow J observed: [14] The prejudice which the defendant relies upon is the deferral of its capacity to compulsorily acquire the balance of the shares in Elders while the application under s 701(6) is dealt with, causing a consequent delay in deriving the benefit of having it as a wholly-owned subsidiary. It can be conceded that this is a detriment. Its degree is contingent upon whether the plaintiffs would ultimately successfully resist compulsory acquisition in the principal proceedings, if they are saved by a dispensing order. But there is at least the detriment of delay in litigating the matter. But detriment per se is not the same as substantial injustice; that must depend on whether the remedial order in giving rise to that detriment is unjust in the sense of causing such prejudice overall as to be unfair or inequitable, taking into account the interests of all of those directly affected by such dispensation. [15] The authorities on the meaning of "substantial injustice" are conveniently summarised in a judgment of Owen J in Elderslie Finance Corp Ltd v ASC (1993) 11 ACSR 157; 11 ACLC 787 at 790. I agree with the submission of counsel for the applicant that s 1322(4) of the Law is a remedial remedy and should be given a liberal construction: see Re Australian Koyo Ltd (1984) 2 ACLC 429 at 431 ; (1984) 8 ACLR 928 at 930. The onus is on the applicant to establish positively that no substantial injustice has been or is likely to be caused to any person: see Australian Hydrocarbons NL v Green & Ors; Green & Ors v Australian Hydrocarbons NL (1985) 3 ACLC 779 at 789 ; (1985) 10 ACLR 72 at 83. The word "injustice" requires the Court to consider real, and not merely insubstantial or theoretical prejudice. A degree of prejudice to a person or persons may be outweighed if the overwhelming weight of justice is in favour of making the order: see Re Compaction Systems Pty Ltd (1977-1978) CLC ¶40-313 at 29,316 ; (1976) 2 ACLR 135 at 150. Of particular importance, so urged Counsel on behalf of Ms Jackson, was the absence of any reference to the broader interests of the corporation and the emphasis placed by Santow J of the injustice advanced - in that case - by the defendant. Reliance was also placed upon the observation endorsed by Santow J as to where the onus lay. 133 When commenting upon a similar statutory provision previously found in s 366 of the Companies Act 1961 (NSW), Bowen CJ in Eq said in Re Compaction Systems Pty Ltd and the Companies Act [1976] 2 NSWLR 477 at 493: … In my view, the word "injustice" in this provision requires the Court to consider any real, and not merely insubstantial or theoretical, prejudice which will be suffered by, for example, a member by the making of an order, and to weigh this in the scales against the prejudice to the company, other members and creditors, if an order be not made. In other words, it is insufficient to show that there may be some prejudice to a member if, on a consideration of the whole matter, the overwhelming weight of justice, as it were, is in favour of making the order … 134 Notwithstanding the self-evident differences between the provisions of s 1322 of the Corporations Act and the statutory provisions now under consideration, it is unnecessary to resolve any question as to onus. Even if it be the case that the onus of proving that the vacation of Ms Jackson's office lay upon those seeking that result, the onus has been discharged. 135 The effect of the vacation of the office presently held by Ms Jackson affects her in a number of ways, including a financial impact. 136 At present, Ms Jackson holds the office of National Secretary of the Federal Union (a position attracting remuneration of about $150,000) and the position of Executive President of the State Union and the Federal Branch (a position attracting remuneration of about $270,000). She has not been receiving the remuneration for the National Secretary position since she was elected to the position of Executive President. 137 In the absence of explanation, a salary of approximately $270,000 may seem open to question when compared to the remuneration attaching to the position of National Secretary. But nothing turns upon such a comparison. The loss of the remuneration of $270,000, however, may not be as "substantial" as it may first appear. There is, for instance, some evidence in the form of an extract from an interview given to the 7.30 Report that Ms Jackson accepts that a salary of $270,000 is "a little excessive" for someone representing some of the "poorest workers in Australia…". She has stated publicly that she would be prepared to "put [her] hand up and … [take] at least $100,000 [as a] salary cut". The loss of the $270,000 remuneration, it was suggested by Counsel for Mr Brown and his associated Applicants, would not affect her entitlement to the remuneration of $150,000 attaching to the position of National Secretary. 138 It is also accepted that the vacation of the office held by Ms Jackson impacts upon her beyond pure financial considerations. The vacation of her office may potentially affect her reputation and would disrupt her ability to continue to pursue issues which she considers to be for the "common good" of the Federal Branch and the State Union. On her approach, the origin of the disharmony within the Federal Branch and the State Union is her claim to be exposing "corruption". But these further considerations do not lead to any different conclusion. Indeed, even if attention is given to these further considerations, the onus of establishing that no "substantial injustice" would be occasioned to Ms Jackson is further discharged given that: part of the factual basis informing the conclusion that the bodies have ceased to function effectively are a number of allegations that have been made against her; and she is very much at the epicentre of the dispute. Irrespective of the merits or otherwise of the allegations she has made, she is at least partly responsible for the collective dysfunction of the Federal Branch and the State Union. The fact that Ms Jackson genuinely holds the belief that she is seeking to expose "corruption" may be accepted. There may even be considerable factual merit in her position. 139 The allegations made against her may not, on one view, be surprising. Given the nature of the allegations she has made against others and the internal factional disputes within the Federal Branch and the State Union, counter-allegations against Ms Jackson may be somewhat inevitable. The allegations made against her include claims that she: (a) engaged in unauthorised expenditure of union funds; (b) failed to produce annual budgets; (c) failed to provide proper documentation to the Finance Committee of the Federal Union. (d) failed to file financial returns in accordance with the Commonwealth Registered Organisations Act. The merit of these allegations, like other allegations, need not be resolved. The Secretary of the Western Australia Branch of the Federal Union, Mr Daniel Hill, has also voiced concerns that Ms Jackson focuses "almost all of her time on non-national duties". He expressed the view that Ms Jackson has "neglected her duties as National Secretary, particularly when performing her duties relating to the proper financial governance of the union". Mr Hill also takes the view that she has failed "to deliver quality representation and service" for members. 140 Prior to the merger of the branches in 2010, Mr Marco Bolano, Ms Jackson and Mr Michael Williamson were, respectively, the Secretaries of the Victorian No 1, 3 and NSW Branches of the Federal Union. Following the merger divisions between Ms Jackson and Mr Williamson emerged. Mr Brown set forth in his Affidavit a chronology of events. He referred to "over 1,000 articles published concerning Kathy Jackson and Michael Williamson" and to the "internal disunity and disputation between Ms Jackson and those who support her, and Mr Williamson, and those who support him…" That "disputation", Mr Brown maintains, has been "played out on the front pages and in leading articles of major newspapers across Australia over the last eight months". 141 Any assessment as to whether Ms Jackson will suffer "substantial injustice" if she is removed from her office must necessarily take into account the financial impact upon her and the role that she has played - or has perhaps been forced upon her - in the affairs surrounding that office. If the onus lies upon those seeking the vacation of her office, that onus has been discharged. 142 If regard is had to the more generally expressed interests of the Federal Branch and the State Union, the discharge of any onus on the Applicants is even more easily satisfied. Given the extent to which those entities have ceased to function effectively, there is little doubt that the vacation of all offices and the calling of new elections for all position is clearly the best course to pursue. To the extent that it was argued that the phrase "substantial injustice" did not extend to a consideration of the more generally expressed interests of those entities, the submission is rejected. Such a constraint upon the operation of s 323(4) (and s 290B(11)) is neither warranted by the terms of those provisions nor would such a constraint be consistent with the objects and purposes of the Commonwealth Registered Organisation Act in s 5 (and s 3 of the State Industrial Relations Act). 143 It is therefore unnecessary to resolve the submission that the term "member" as it appears in s 323(4) (and s 290B(11)) does not extend to the prejudice claimed by Ms Jackson because that it not a prejudice suffered by her in her capacity as a "member". The construction of that term - it was submitted - was confined to (for example) the imposition of a levy upon a member. 144 One final consideration relevant to whether Ms Jackson should be required to vacate her office should be addressed. Given the factional disputes within the Federal Branch and the State Union, the potential appearance of unfairness that may be perceived by the members (whether justified or not) of only one office-holder retaining her position whilst the others were vacated cannot be discounted. And, irrespective of any such appearance of unfairness, how Ms Jackson was to further discharge her functions in a manner consistent with the powers that would be conferred upon the administrator would only have been an inevitable source of difficulty. If the restructured organisations are to have the best chance of returning power to the membership at the earliest possible date, it is considered imperative that the administrator be free to exercise his powers free of any constraint imposed by any residual office holder. 145 One submission which was not advanced by those appearing for Ms Jackson was that it was essential to resolve the merits of the allegations of corruption being advanced by her - at least for a limited purpose confined to the application of s 323(4) (and s 290B(11)). If those facts were resolved in her favour, it would then have been open to contend that those who expose corruption would suffer a "substantial injustice" if the price they paid for doing so was the loss of office. To advance such a submission, of course, would have been a departure from - if not a substantial abandonment of - the Agreed Statement of Facts. To advance such a submission could also have had the potential to put Ms Jackson in a position different to other members whose offices were to be vacated. At least at one point, her position was that there should not be a vacation of any office; her office being in no different position to the others. There may thus have been legitimate forensic reasons why the submission was not advanced. 146 Notwithstanding the arguments that have been advanced on Ms Jackson's behalf, it is concluded that the vacation of all offices should be effected by an express order of the Court rather than taking effect as a term of the "scheme". 147 For the purposes of s 323(4) (and s 290B(11)), the Court is satisfied that the making of an order will "not do substantial injustice to the organisation or any member of the organisation".

A CHANGE OF DIRECTION? 161 Up until Thursday 7 June 2012 the proceedings had been relevantly conducted on the basis of: the Agreed Statement of Facts; the Affidavits contained within the Court Book; and the absence of any application by any party to cross-examine any of the deponents of those Affidavits. All participants had filed written submissions. All participants had orally addressed their written submissions. 162 It was during the course of final oral submissions on behalf of Ms Jackson on 7 June 2012 that it became apparent that her then-Counsel may have felt some misgivings regarding the manner in which the proceeding had been conducted up to that point. It was suggested that if any application was to be made, it would obviously have to be made before he closed his submissions. The hearing was adjourned until the following day with Counsel then appearing for Ms Jackson indicating would be only about take "about another 20 minutes" and had only several paragraphs remaining in his written outline of submissions to address. 163 Things took an unexpected turn of events on the following day. At the outset of the proceedings on Friday 8 June, Counsel advised the Court that certain "advice" had been given to Ms Jackson and that thereafter Ms Jackson had withdrawn her instructions to both the solicitors and Counsel appearing on her behalf. It was indicated that Mr Rofe QC may seek to appear on her behalf. Ms Jackson's Counsel and instructing solicitors immediately withdrew. 164 Mr Rofe QC was of the view that he may have been instructed by Ms Jackson to appear on her behalf and that his instructing solicitors were those who had just withdrawn. A short adjournment was granted to enable him to determine if indeed he was instructed to appear on her behalf. The hearing resumed and there was uncertainty as to what future course the proceedings were to take. A further short adjournment was granted to enable Mr Rofe QC to obtain instructions as to whether Ms Jackson wished to make an application to depart from the Agreed Statement of Facts or to call further evidence. Given the shortness of the adjournment granted, all that was expected was some indication as to what future course the proceedings may possibly take. 165 The hearing resumed and Mr Rofe QC sought a further adjournment of approximately one to two weeks in order to enable him to get on top of the evidence and submissions that had to-date been made and the contents of the four volume Court Book. 166 The application for an adjournment did not distinguish between whether an adjournment was being sought in respect to the application for the interim appointment of an administrator or in respect to the final hearing. It was assumed that the application extended to both. 167 Any adjournment of the application for the Court to appoint an interim administrator was without merit. Ms Jackson's decision to withdraw her former legal advisers' instructions on what was anticipated to be the last day of the hearing, it was considered, did not warrant a deferral of an application which had been foreshadowed on the first day of the hearing by Senior Counsel for the State Union. The circumstances, it was considered, warranted an immediate decision. 168 Any consideration of a possible adjournment of the proceedings and the making of final orders could not, of course, be properly considered without knowing the basis upon which the application was being made. On one view, in the absence of a properly formulated application for an adjournment being then made, the application could have been summarily rejected. 169 The task confronting Mr Rofe QC was unenviable. He had little, if any, knowledge of the issues or the evidence. Not surprisingly, he too withdrew. Ms Jackson then appeared on her own behalf. She had little difficulty in formulating - at least in part - the position she wished to advance. In very summary form, her position was that: she took particular issue with the appointment of the Honourable Michael Moore as an interim administrator; and, with reference to the factual basis upon which the Court was previously proceeding: she wished to put "all of it in issue". Particular reference was made to the Affidavit of Mr Brown which addressed in part the circumstances surround the original merger and proposed demerger of the HSU East Branch. She wished to cross-examine all of the deponents of all of the Affidavits contained within the Court Book. 170 On the issue of the identity of the interim administrator, many of her submissions went well beyond the evidence. Ms Jackson's submissions, irrespective of whether they went beyond the evidence or not, only served to reinforce the desirability of the Court assuming the responsibility for his appointment as an interim administrator (and thereafter as administrator) and the importance of appointing a person well equipped and qualified to independently deal with (and resolve, if necessary) competing factual contentions in what had all the hallmarks of becoming a highly "politicised" context. 171 As to the second of the matters raised by Ms Jackson, the proceedings were adjourned until Friday 15 June 2012. This was so notwithstanding such difficulties as would inevitably be involved in seeking the leave of the Court pursuant to s 191(2) of the Evidence Act to "contradict or qualify an agreed fact" and such further potential difficulties as may be encountered in making an application to in effect re-open her "case". Any application to "contradict or qualify an agreed fact", it may well have been expected, would have been approached by the Court with caution: cf. Environment Protection Authority v Ramsey Food Processing Pty Ltd [2009] NSWLEC 152 at [16] per Biscoe J. The adjournment in fact granted was to enable either Ms Jackson, or Mr Rofe QC on her behalf, to more properly identify how she proposed the proceedings should continue. That adjournment was opposed by the remaining parties. Although the difficulties experienced by Ms Jackson may be seen as being the result of her own actions, the fact was that she was unrepresented and the adjournment until 15 June was still within the three weeks originally set aside for the hearing. 172 Although Ms Jackson was willing on 8 June 2012 to provide an explanation as to why she had withdrawn her instructions from her previous legal representatives, it was considered inappropriate for any such explanation to be provided. Who she wished to retain was her prerogative. And an explanation, if provided, may well have involved an unrepresented party disclosing in whole or in part the disclosure of the legal "advice" she had been given by her former legal representatives. 173 On Friday 15 June 2012 Mr Rofe QC again appeared on behalf of Ms Jackson for the limited purpose of seeking an adjournment for a further week. He appeared with Junior Counsel but without the benefit of instructing solicitors. That application was founded upon: an assertion that he had been unable to gain access to Ms Jackson over the preceding week; an assertion that Ms Jackson had had either no time (or at least insufficient time) in which the address the issues arising in the proceedings; an undated and unsigned letter from a Dr Paul Foulkes, a Consultant Psychiatrist. No order was sought by Mr Rofe QC for an order pursuant to s 50 of the Federal Court of Australia Act in respect to the public availability of that letter and no order, accordingly, was made; and the limited financial resources available to Ms Jackson. These factors, it was submitted, resulted in Ms Jackson: being denied an opportunity have access to proper legal advice. To the extent that there has been non-compliance by Mr Rofe QC with Rule 4.04 of the Federal Court Rules 2011, compliance may be dispensed with. 174 The application for the further adjournment was refused. 175 It was considered that there was no evidence to support either of the two assertions. It is inexplicable that time could not be found within the week afforded to her to give instructions - no matter how limited - to either Mr Rofe QC or his Junior. Little weight could be placed upon the letter from Dr Foulkes. It was unknown when Dr Foulkes had last seen Ms Jackson - although the content of the letter suggested that he may have spoken to her on the telephone within the last week or so. Dr Foulkes did not state that Ms Jackson was not fit to meaningfully participate in the hearing or when, in his opinion, her condition would be such that she would be better able to participate in the hearing. Certainly during the course of oral submissions on both 8 and 15 June 2012 she presented as a coherent and focused individual. Any submission that Ms Jackson had been "denied" access to legal advice was without substance. Up until she withdrew her instructions from her initial legal representatives, she had had the benefit of their advice. 176 The adjournment from 8 to 15 June 2012, it was considered, was more than adequate for instructions to have been obtained - at least in outline - as to whether Ms Jackson wished (for example) to seek leave to depart from one or other of the facts in the Agreed Statement of Facts or the nature of such further evidence as she may have wished to adduce. Such misgivings as Counsel previously retained by Ms Jackson may have had on 7 June 2012, and the opportunity extended to him to make an application if considered appropriate, could well have been addressed between that date and 15 June 2012. If there was to be (for example) an application to cross-examine one or other of the deponents of the Affidavits contained within the Court Book, it was expected that those deponents could have been identified and the issues identified upon which she wished to cross-examine. And, notwithstanding the submissions she advanced on 8 June 2012 regarding the circumstances in which the Federal Branch was formed, there was no attempt on 15 June 2012 to even identify the nature of any further evidence that she may have wished to lead even on that confined factual issue. No clarification was provided by Mr Rofe QC. The best that could be done was to assert that she wished to vindicate the merits of the position she had adopted throughout the dispute. There was no identification of any specific finding of fact which it was contended should be made (perhaps in addition to those set forth in the Agreed Statement of Facts) or any identification of any specific further or additional finding of fact which should be made - even for a confined purpose (such as the application of s 323(4) (or s 290B(11)). In the absence of any identification of where any potential factual dispute was headed, it was considered that an unstructured traversing of the facts would not be of any persuasive relevance. It was the fact of the disputes within the Federal Branch and the State Union which led to them ceasing to function effectively. Who was right or wrong - or who first started the allegations that later led to the dysfunction - it was considered, would not lead to any different view regarding the appropriateness of granting the declaratory relief sought pursuant to s 323(1) and s 290B(1). It was also considered highly unlikely that the resolution of the factual merits of the competing allegations would have led to any different form of orders or scheme. 177 No satisfactory basis for the granting of a further adjournment, it was thus concluded, had been made out. 178 Having regard to the interests of the remaining parties to the two proceedings and the interests of the members of the Federal Branch and the State Union, the refusal of any further adjournment was further justified. 179 Consideration of the matters in both ss 37M and 37N of the Federal Court of Australia Act only further reinforced this conclusion. When addressing the form of a rule of court (r 21) which permitted "all necessary amendments", in AON Risk Services Australia Limited v Australian National University [2009] HCA 27, 239 CLR 175 Gummow, Hayne, Crennan, Kiefel and Bell JJ observed: [92] The purposes stated in r 21 reflect principles of case management by the courts. Such management is now an accepted aspect of the system of civil justice administered by courts in Australia. It was recognised some time ago, by courts here and elsewhere in the common law world, that a different approach was required to tackle the problems of delay and cost in the litigation process. In its report in 2000, Managing Justice: A review of the federal civil justice system, the Australian Law Reform Commission noted that: "Over the last ten years Australian courts have become more active in monitoring and managing the conduct and progress of cases before them, from the time a matter is lodged to finalisation". [93] Rule 21(2)(b) indicates that the rules concerning civil litigation no longer are to be considered as directed only to the resolution of the dispute between the parties to a proceeding. The achievement of a just but timely and cost-effective resolution of a dispute has an effect upon the court and upon other litigants. In Sali v SPC Ltd Toohey and Gaudron JJ explained that case management reflected [(1993) 67 ALJR 841 at 849] : "[t]he view that the conduct of litigation is not merely a matter for the parties but is also one for the court and the need to avoid disruptions in the court's lists with consequent inconvenience to the court and prejudice to the interests of other litigants waiting to be heard ... " Case management principles, it may be accepted, should not supplant the objective of doing justice between the parties: Andrews v Australia and New Zealand Banking Group Ltd [2011] FCA 388 at [23], 281 ALR 113 at 122-123 per Gordon J. In an appropriate case it may be necessary to make a decision which may produce a sense of injustice for the sake of doing justice to other litigants (applied in Comcare v John Holland Rail Pty Ltd (No 5) [2011] FCA 622 at [23]. 195 FCR 43 at 50 per Bromberg J). 180 In the present proceedings, it is concluded that Ms Jackson can make no legitimate claim to have suffered any sense of injustice. No basis, it was concluded, had been provided to justify departing from the manner in which the two proceedings had been managed and conducted up until 8 June 2012. Mr Rofe QC provided no satisfactory explanation as to what had happened in the week between 8 June and 15 June 2012 or what attempt had been made by him and his Junior to become familiar with the evidence and the issues in the case; indeed, on his explanation, nothing had happened. No injustice, it was concluded, would be occasioned to Ms Jackson by refusing her application for an adjournment. She had not demonstrated with any precision at all what would be achieved if a further adjournment were granted.

(1984) 3 FCR 138

(1983) 76 FLR 141

(1986) 12 FCR 197

(1983) 79 FLR 26

(1983) 152 CLR 570

(1990) 19 NSWLR 263

(1975) 27 FLR 129

(1950) 81 CLR 502

(1973) 129 CLR 65

(1990) 64 ALJR 495

(1997) 189 CLR 579

(1985) 11 IR 174

(1981) 54 FLR 129

(1981) 148 CLR 457

(1973) 129 CLR 654

(1979) 141 CLR 577

(1976) 135 CLR 194

(1992) 175 CLR 442

(1978) 142 CLR 1

(1993) 40 FCR 511

(1989) 167 CLR 568

(1999) 198 CLR 511

(1936) 55 CLR 608

(1993) 67 ALJR 841

(1976) 136 CLR 248

[1999] FCA 18

[2009] HCA 27

[2011] FCA 622

[2009] FCA 319

[2012] FCA 380

[2006] FCAFC 55

[2004] NSWCCA 353

[2003] HCA 75

[2010] FCA 597

[2012] NSWCA 14

[2011] FCA 388

[2011] FCA 1360

[2011] FCA 382

[2012] FCAFC 56

[2010] HCA 13

[2010] NSWIRComm 107

[2001] FCA 1117

[2002] HCA 47

[2003] FCAFC 272