Construction, Forestry, Mining and Energy Union v Alfred

Date of hearing: 13 August 2010

Place: Sydney

Division: FAIR WORK DIVISION

Category: Catchwords

Number of paragraphs: 146

Counsel for the First, Second and Third Appellants: Mr J Pearce

Solicitor for the First, Second and Third Appellants: Taylor & Scott Lawyers

Counsel for the Respondent: Mr J Fernon SC with Ms E Raper

Solicitor for the Respondent: Freehills

IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY FAIR WORK DIVISION NSD 1272 of 2009

ON APPEAL FROM THE FEDERAL MAGISTRATES COURT OF AUSTRALIA

BETWEEN: CONSTRUCTION, FORESTRY, MINING & ENERGY UNION

CONSTRUCTION, FORESTRY, MINING & ENERGY UNION (NSW BRANCH)

JUDGES: BUCHANAN, Flick and Katzmann JJ DATE OF ORDER: 10 February 2011 WHERE MADE: SYDNEY

1. The appeal be dismissed. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. The text of entered orders can be located using Federal Law Search on the Court's website.

IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY FAIR WORK DIVISION NSD 1272 of 2009

ON APPEAL FROM THE FEDERAL MAGISTRATES COURT OF AUSTRALIA

BETWEEN: CONSTRUCTION, FORESTRY, MINING & ENERGY UNION

CONSTRUCTION, FORESTRY, MINING & ENERGY UNION (NSW BRANCH)

JUDGES: BUCHANAN, Flick and Katzmann JJ DATE: 10 February 2011 PLACE: SYDNEY

The parties 1 The appellants are, respectively, a federal union ("the CFMEU"), a state union ("the New South Wales branch") and a union organiser whom the CFMEU and the New South Wales branch each admitted they employed ("Mr Manna"). The respondent is an Inspector ("the informant") who was appointed under s 57 of the Building and Construction Industry Improvement Act 2005 (Cth) who was competent to commence the proceedings against the appellants which have led to the present appeal.

The proceedings at first instance 2 The informant commenced proceedings in the Federal Magistrates Court of Australia ("the FMCA") against the appellants alleging a breach by them of s 789 of the Workplace Relations Act 1996 (Cth) ("the WR Act") (since repealed and replaced by the Fair Work Act 2009 (Cth)). The alleged breach of the WR Act arose from events which occurred on 11 April 2006. The application filed by the informant sought penalties and other relief under s 807 of the WR Act. The FMCA found that the alleged breaches of the WR Act had been established (Alfred v CFMEU & Ors [2009] FMCA 613) and imposed monetary penalties on each of the appellants (Alfred v CFMEU & Ors (No.2) [2009] FMCA 1003). The penalties imposed were $13,000 on each of the CFMEU and the New South Wales branch and $2,600 on Mr Manna. 3 The events which provided the foundation for the proceedings arose from a telephone conversation between Mr Manna and Mr John Holm on the afternoon of 11 April 2006. Mr Holm was a concreter. He was in partnership with a Mr and Mrs Spicer. Together they traded as "Anything Concrete" and carried out concrete placing and finishing work. On such work Mr Holm had the day to day role of managing the affairs of the partnership and of conducting negotiations on its behalf. He worked personally on jobs taken by the partnership. When a project was undertaken the partnership also engaged additional labour necessary to carry out the contracted work. Those persons, it appears, were not engaged as employees but rather as individual subcontractors, a practice which was regarded with disfavour by the CFMEU and the New South Wales branch. Persons engaged in that fashion, and Mr Holm himself, were eligible to be members of both the CFMEU and the New South Wales branch, each of which had an active policy that such persons should be members. Part of Mr Manna's role involved encouraging union membership. 4 In 2006 a shopping centre known as "The Portico Plaza" was under construction at Toongabbie, New South Wales. The head contractor was North East Developments Pty Ltd ("North East"). On 21 February 2006 North East contracted with Conform Australia Pty Ltd ("Conform") for it to supply form work and to place and finish concrete at the site. The sole director and secretary of Conform was Mr Joseph Younan. On or about 24 March 2006 Conform contracted with the Anything Concrete partnership for it to carry out concrete placing and finishing work in performance of parts of Conform's contract with North East. 5 On 11 April 2006 there was a meeting at the site. Mr Simon Symond, a director of North East, Mr Manna and another official of the CFMEU met together. Mr Younan was on the site and was asked to join the meeting. Mr Manna was informed that Anything Concrete had been engaged by Conform to perform work on the site. He expressed his strong disapproval of that choice. During the afternoon Mr Manna (but not in the presence of the others) spoke to Mr Holm for about 16 minutes. They each spoke on a mobile telephone. During this conversation statements were made by Mr Manna which were asserted in the pleadings to be evidence of a breach of s 789 of the WR Act. 6 In an amended statement of claim filed on 2 October 2008 the matters relied upon by the informant were pleaded as follows: 10. On or about 11 April 2006, Manna advised John Holm that if he proceeded with the Anything Concrete services on the Site and he did not become a member of the First and/or Second Respondent, Manna would: (a) bankrupt Holm and/or Anything Concrete; (b) have Holm and/or Anything concrete audited; and/or (c) make Holm's life a misery. 10A. In the alternative to paragraph 10, on or about 11 April 2006, Manna advised Holm that if he proceeded with the Anything Concrete services on the Site and he and/or his employees and/or subcontractors did not become members of the First and/or Second Respondent, Manna would: (a) bankrupt Holm and/or Anything Concrete; (b) have Holm and/or Anything concrete audited; and/or (c) make Holm's life a misery. 11. In so doing, Manna threatened to organise or take action against Holm with the intent to coerce Holm and/or his employees and/or subcontractors to become members of the First and/or Second Respondent. 12. By reason of the matters pleaded in paragraphs 10, 10A and 11, Manna contravened section 789 of the Act. 7 By this pleading, about which no complaint was made on the appeal, the informant sought to attach liability to Mr Manna under s 789 of the WR Act for statements made by Mr Manna to Mr Holm concerning the question of whether he should become a member of the CFMEU (or the New South Wales branch) and whether other persons engaged by Anything Concrete to work on the site, whether as employees or subcontractors, should become members of either association. 8 The CFMEU and the New South Wales branch were alleged to be jointly and severally culpable with Mr Manna by reason of s 779(2) of the WR Act which provided that the conduct of an officer of an "industrial association" was taken to be conduct of that industrial association. The term "industrial association" was defined in s 779(1) to include an association of employees registered under an industrial law. The term "industrial law" was defined, also in s 779(1), to include the WR Act and a law of a State regulating the relationships between employers and employees. The CFMEU was registered under the WR Act. The New South Wales branch was registered under the Industrial Relations Act 1996 (NSW), a State law which satisfied the definition of "industrial law" in s 779(1). As a result, if Mr Manna's conduct was proved to be in breach of s 789 of the WR Act, it would follow, so the informant contended, that the CFMEU and the New South Wales branch had also breached the same provision. On the present appeal an issue arises as to whether the legislative provisions had the result that the New South Wales branch could be held liable under s 789 of the WR Act for Mr Manna's conduct but, subject to the resolution of that issue, it was not denied that the CFMEU and the New South Wales branch would be jointly liable with Mr Manna. 9 Neither Mr Manna nor Mr Holm made any contemporaneous record of their conversation. Their evidence about the conversation which took place between them on 11 April 2006 was irreconcilable. Inevitably, findings of fact were required which would involve acceptance of the evidence of one of them rather than the other where matters were in dispute and corresponding rejection of any competing version of the events. The FMCA accepted Mr Holm's version of events and rejected Mr Manna's. 10 The FMCA found that the statements Mr Manna made to Mr Holm were made with an intent to coerce Mr Holm personally to become a member of the CFMEU and the New South Wales branch and to coerce him to procure the union membership of the Anything Concrete workforce which would be engaged on the project.

The meaning of "intent to coerce" 11 Section 789 of the WR Act provided: 789 Coercion (1) A person must not organise or take, or threaten to organise or take, any action against another person with intent to coerce the other person or a third person: (a) to become, or not become, an officer or member of an industrial association; or (b) to remain, or cease to be, an officer or member of an industrial association. 12 The meaning of the phrase "intent to coerce" in this statutory setting has become settled (see Finance Sector Union of Australia v Commonwealth Bank of Australia (2000) 106 FCR 16 per Gyles J at [18]-[38]; National Union of Workers v Qenos Pty Ltd (2001) 108 FCR 90 per Weinberg J at [128]; Seven Network (Operations) Ltd v Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (2001) 109 FCR 378 ("Seven Network") per Merkel J at [38]-[43]; Williams v Construction, Forestry, Mining and Energy Union [2009] FCA 223 ("Williams") per Jessup J at [105]). The relevant principles were distilled by Merkel J in Seven Network in the following terms (at [41]): First, it needs to be shown that it was intended that pressure be exerted which, in a practical sense, will negate choice. Second, the exertion of the pressure must involve conduct that is unlawful, illegitimate or unconscionable. 13 No issue arose in the present case about the second aspect. It was not suggested that the FMCA made any relevant error in its assessment of that issue. However, there are, as will be seen, questions which arise for examination concerning whether, and to what extent, the first element identified by Merkel J was satisfied in the present case.

The approach to the appeal 14 An appeal such as the present involves examination of the question of whether error was made in the judgment under appeal (see eg Whittaker v Child Support Registrar [2010] FCAFC 112 at [2]). In its examination of that question, an appeal court may be required to make its own assessment of the facts. Whether it is in a position to do so in a way which differs from the assessment made by a trial judge will often depend on whether the findings of fact made by the trial judge are based on an advantage not enjoyed by the appeal court, such as the resolution of disputed facts based on an assessment of the credit (or lack of credit) of witnesses in circumstances which depend upon actually hearing and seeing the witnesses give evidence. 15 In the present case the resolution of the conflict between the evidence of Mr Holm and the evidence of Mr Manna depended very substantially upon an assessment of the credit of each of them. It depended, in part, upon observation of the way each of them gave evidence and responded to questions. The FMCA said it was comfortably satisfied that Mr Holm's account of the conversation should be accepted. It said it had a very favourable impression of Mr Holm's demeanour when giving evidence, to which it had given significance. By contrast, it found Mr Manna's evidence to be (variously described) unpersuasively presented, untruthful, unbelievable, unsatisfactory and clearly inconsistent with contemporaneous records. 16 In Fox v Percy (2003) 214 CLR 118 the majority judgment in the High Court (Gleeson CJ, Gummow and Kirby JJ) discussed the approach which should be taken by an intermediate appellate court dealing with an appeal where a judge at first instance had determined questions of fact, and ultimately liability, based on findings about the credibility of witnesses. In that case, the New South Wales Court of Appeal had set aside the verdict of a trial judge and entered judgment for the defendant even though the findings of the trial judge (in favour of the plaintiff) were substantially influenced by his acceptance of the evidence of particular witnesses over others. One question which arose on the appeal to the High Court was whether the Court of Appeal was entitled to set aside the findings of the trial judge or was bound to defer to the advantage he possessed of hearing and seeing the evidence given. At [25] the majority justices quoted the following passage from Warren v Coombes (1979) 42 CLR 531 at 551: "[I]n general an appellate court is in as good a position as the trial judge to decide on the proper inference to be drawn from facts which are undisputed or which, having been disputed, are established by the findings of the trial judge. In deciding what is the proper inference to be drawn, the appellate court will give respect and weight to the conclusion of the trial judge but, once having reached its own conclusion, will not shrink from giving effect to it." 17 Their Honours then referred (at [26]) to an established line of authority "concerning the need for appellate respect for the advantages of trial judges, and especially where their decisions might be affected by their impression about the credibility of witnesses whom the trial judge sees but the appellate court does not" (Jones v Hyde (1989) 63 ALJR 349 at 351-352; 85 ALR 23 at 27-28; Abalos v Australian Postal Commission (1990) 171 CLR 167 at 179; Devries v Australian National Railways Commission (1993) 177 CLR 472 at 479, 482-483). 18 Importantly, their Honours observed (at [27]): The cases mentioned remain the instruction in this Court to appellate decision-making throughout Australia. 19 The instruction in those cases (and this was the point which required direct attention in Fox v Percy) does not have the consequence that conclusions based on credibility findings are unreviewable but, as emphasised in the passage which follows, the circumstances which might justify an appeal court acting contrary to or in disregard of credibility findings are limited. The majority judgment in Fox v Percy said, in that respect, (at [28]-[29]): 28 Over more than a century, this Court, and courts like it, have given instruction on how to resolve the dichotomy between the foregoing appellate obligations and appellate restraint. From time to time, by reference to considerations particular to each case, different emphasis appears in such reasons. However, the mere fact that a trial judge necessarily reached a conclusion favouring the witnesses of one party over those of another does not, and cannot, prevent the performance by a court of appeal of the functions imposed on it by statute. In particular cases incontrovertible facts or uncontested testimony will demonstrate that the trial judge's conclusions are erroneous, even when they appear to be, or are stated to be, based on credibility findings. 29 That this is so is demonstrated in several recent decisions of this Court. In some, quite rare, cases, although the facts fall short of being "incontrovertible", an appellate conclusion may be reached that the decision at trial is "glaringly improbable" or "contrary to compelling inferences" in the case. In such circumstances, the appellate court is not relieved of its statutory functions by the fact that the trial judge has, expressly or implicitly, reached a conclusion influenced by an opinion concerning the credibility of witnesses. In such a case, making all due allowances for the advantages available to the trial judge, the appellate court must "not shrink from giving effect to" its own conclusion … (Emphasis added - footnotes omitted) 20 McHugh J said (at [90]): It is a serious mistake to think that anything said in Abalos or Devries necessarily prevents an appellate court from reversing a trial judge's finding when it is based, expressly or inferentially, on demeanour. Those cases recognise - in accordance with a long line of authority - that it may be done. But there must be something that points decisively and not merely persuasively to error on the part of the trial judge in acting on his or her impressions of the witness or witnesses. Recently in State Rail Authority (NSW) v Earthline Constructions Pty Ltd (in liq), for example, this Court held that undisputed and documentary evidence was so convincing that no reliance on the demeanour of witnesses could rebut it. (Emphasis added - footnote omitted) 21 Although a headnote in a published report, even in an authorised series such as the Commonwealth Law Reports, may not be substituted for, or contradict, the text of the judgments in the case in question, it is instructive to note the principle for which Fox v Percy is said by the headnote to be authority (at page 118): A finding of fact by a trial judge, based on the credibility of a witness, may only be set aside upon appeal where incontrovertible facts or uncontested testimony demonstrate that the judge's conclusions are erroneous or where it is concluded that the decision at the trial was glaringly improbable or contrary to compelling inferences in the case. 22 In my view Fox v Percy is not authority for the proposition that findings based on credibility are to be treated with less respect than before. On the contrary, Fox v Percy emphasised again the limitations which were earlier recognised whilst accepting that, in that particular case, appellate intervention by the Court of Appeal had been justified. 23 A clear case of error would therefore need to be established before the findings of fact made by the FMCA, based on an assessment of the respective credit of Mr Holm and Mr Manna, were displaced on appeal.

The findings of fact 24 I am satisfied that the Federal Magistrate who heard the case at first instance made a conscientious and careful analysis of the evidence before him. He explained in considerable detail the findings of fact which were made and the way in which he assessed the evidence of various witnesses including, in particular, the evidence of Mr Holm and Mr Manna. He explained the reasons why he accepted the evidence of Mr Holm and rejected the evidence of Mr Manna. He identified the factors which he took into account and explained why they were significant. Insofar as a preference was expressed for the evidence of Mr Holm over the evidence of Mr Manna it seems to me that the Federal Magistrate had an undeniable advantage which constitutes a very significant obstacle to any interference with those findings on appeal unless the findings were inconsistent with incontrovertible facts or the decision was contrary to compelling inferences to be drawn from the evidence as a whole. 25 However, as the authorities make clear, the respect to be accorded to the findings of fact does not prevent a re-assessment of inferences drawn from them. So far as inferences are concerned, it is well established that an appeal court is in as good a position as a trial judge to draw inferences from established facts and should not be deflected from so doing. In the present case, for example, the fact that Mr Holm's evidence about the content of the disputed conversation with Mr Manna was accepted (and Mr Manna's evidence rejected) does not mean that Mr Holm's subjective conclusions are necessarily to be accepted, that inferences arising from the established facts are not reviewable or that legal conclusions based on the established facts, and the inferences to be drawn from them, do not remain a matter for debate. 26 The appellants made a series of attacks on particular findings of fact, and other observations, made by the FMCA. The attacks were directed to two issues: a defence of Mr Manna's evidence and credibility; and a contention that not all of Mr Holm's evidence should be accepted. In particular, it was argued that, in the light of other evidence, the FMCA should not have accepted that any threat made by Mr Manna to Mr Holm was concerned with union membership. 27 I shall shortly deal with the evidence about the conversation in greater detail. However, the following points might be made now. 28 The FMCA was conscious of the need to be positively satisfied that it should accept Mr Holm's evidence, even if Mr Manna's evidence was rejected. The FMCA said (at [44]): 44. … it is not enough for me to discount the evidence of Mr Manna. I must be positively, and comfortably, satisfied as to the truth of Mr Holm's recollection of threatening words being spoken as alleged. 29 The FMCA gave explicit consideration to whether it should accept those parts of Mr Holm's evidence to the effect that he had been threatened by Mr Manna over the specific issue of union membership. The FMCA recorded (at [75]): 75. The submissions of the parties invited me to put at the forefront of my consideration of the case whether Mr Holm's account of what was said to him by Mr Manna was true. In particular, whether Mr Manna spoke words which in their expressed terms threatened to cause harm to Anything Concrete if it continued with its contract without employing workers who were union members. 30 The FMCA's finding on this point was (at [84]): 84. … I am comfortably satisfied that [Mr Manna] made threats in the terms attributed to him by Mr Holm. 31 It will become clear from the discussion which follows that, so far as the written record of the proceedings is concerned, and based solely on that record, I would have been less prepared than the FMCA to draw some of the inferences which sustained the conclusion that a breach of s 789 of the WR Act had been committed. There are two questions in the case in respect of which answers were given, inferences were drawn and conclusions were reached which were, despite the advantage possessed by the FMCA, in my respectful view wrongly determined, notwithstanding that Mr Holm's evidence was accepted. As a result I would not have found that the appellants had breached s 789 of the WR Act. Nevertheless, for reasons which it will be necessary to explain, those conclusions do not result in the appeal succeeding. 32 The first question is whether there was a sufficient foundation for a finding that Mr Manna intended to coerce persons other than Mr Holm to join the CFMEU and the New South Wales branch. The FMCA found that Mr Manna intended to coerce Mr Holm to procure the union membership of individual sub-contractors engaged by Anything Concrete. In my view that finding did not sustain a conclusion that Mr Manna intended to coerce those individual sub-contractors to join either the CFMEU or the New South Wales branch. Section 789 of the WR Act required a direct connection between a threat to take action against a person and an intent to coerce that person or a third person to become a member of an industrial association. The intent to coerce must, in the case of a third person, have been sufficiently directed to that third person even if the threatened action was to be taken against another. In other words, even accepting that Mr Manna threatened to take action against Anything Concrete, for a breach of s 789 to be proven it was necessary to show that such a threat was intended to coerce third persons, as well as Mr Holm, to join the CFMEU and the New South Wales branch. 33 The second question is the more general one of whether it should have been concluded by the FMCA that, when he spoke to Mr Holm, Mr Manna intended to coerce Mr Holm (or anybody else) to join the CFMEU and the New South Wales branch. In order to examine the second question it is relevant to enquire whether, on the evidence, Mr Manna had a different objective altogether - namely, to prevent Anything Concrete from being accepted on the site at all. 34 Further discussion of these two questions must await a more detailed examination of the evidence which was before the FMCA. Those issues aside, I see no basis in the present case to set aside or disregard the findings of fact made by the FMCA as a result of its assessment of the credit of Mr Holm and Mr Manna. To do so would, in my view, be contrary to Fox v Percy because acceptance of Mr Holm's evidence about the words spoken by Mr Manna was not shown to be contrary to incontrovertible facts or uncontested testimony.

The disputed conversation 35 Mr Manna's version of the conversation with Mr Holm on 11 April 2006 may be mentioned briefly in light of the fact that it was rejected, together with his credit. Mr Manna testified that he had a friendly conversation with Mr Holm during which Mr Holm enquired whether he could sign up about twelve persons as members of the union. Mr Manna responded, according to his evidence, that it could not be done over the telephone and he would have to attend to it at the site when work commenced. He said that Mr Holm then announced, during the conversation, that he did not really want the job and had decided not to do it. 36 The last element in this version of events matched the fact that, shortly after the conversation between Mr Manna and Mr Holm, Mr Symond directed that Conform withdraw the contract from Anything Concrete. Mr Holm and his partners that evening signed a document accepting their discharge from the job. However, under a private arrangement with Mr Younan made a short time later, Anything Concrete in fact commenced and continued to perform work for some time until again Mr Symond intervened and the involvement of Anything Concrete came to a definite end on 10 May 2006. 37 The FMCA accepted Mr Holm's version of events, both written and oral, without relevant qualification. Mr Holm's affidavit contained the following conversation: 23. At approximately 3.00pm, I pressed the button which automatically redialled the missed call. A man answered the phone and we had a conversation as follows: Holm: 'John from Anything Concrete, I just received a missed call.' Person: I'm [name of person indistinguishable] from the CFMEU. I want to talk to you about the Toongabbie site. Are your workers employees and are they in the union? Holm: 'Simon Symond said we only need to give a couple of members to the union. All my workers are subcontractors anyway, not employees.' Person: 'It's illegal to do that. They need to be employees with all the benefits. You need to be paying them super, wet days, holidays, sick pay and site allowance.' Holm: 'For the amount quoted for the Toongabbie project, the low price that they got me down to did not allow for any of that. Workers comp has just been through my books. Everything is fine and they actually owe me money. We're being guided by our accountant and the Department of Fair Trading.' Person: 'If you proceed with the job and do not join the union, pay your men the benefits, we'll send you bankrupt.' Holm: 'You can't do that. Everything is legal in the way we operate.' 24. I also recall at some point in the conversation the man raising with me the issue of travel allowance. We had a conversation as follows: Person: 'You will have to pay the members travel allowance.' Holm: 'It's faster to go from The Entrance to Toongabbie than to get across Sydney.' Person: 'I will get a bigger company in there to do the job, like Concrete Constructions.' Holm: 'That's unfair. First the builder screws us and now you.' 25. I cannot now recall the exact sequence of the remainder of the conversation that I had with the man from the union. However, I recall that during the conversation and around the time that man said the words 'I'll send you bankrupt', he also said 'We'll have you audited …' and 'We will screw you and make your life a misery.' I understood at the time that being 'audited' meant being audited by the tax department. When the man from the union said 'We'll have you audited …', I responded as follows: 'We've just been audited by WorkCover and everything's fine. In fact, they owed us money. We're running the business according to their guidelines.' 26. The conversation was a relatively long conversation for a mobile phone call, lasting around 15 to 17 minutes. 27. The conversation with the man from the union became very heated. What sticks firmly in my mind about the conversation was the man's threat to bankrupt me if I commenced working at the Site and did not join the union. This stuck firmly in my mind because I was concerned about the threat to bankrupt Anything Concrete. I understood that my partners in Anything Concrete had used their house to get a loan to back the business. If the business failed and they were unable to pay the loan, they might have lost their house. (Emphasis added) 38 The only words directly attributed to Mr Manna in Mr Holm's affidavit, to the effect that Mr Holm should become a member of either the CFMEU or the New South Wales branch were (set out above from paragraph 23): "If you proceed with the job and do not join the union, pay your men the benefits, we'll send you bankrupt." Regrettably, there appears to be some looseness of language associated with the identification of who might "join the union". It was not confined to Mr Holm or, as attributed by him, to Mr Manna. In the written submissions filed on the appeal for the respondent reference was made twice to demands or coercion that "Anything Concrete join the union". For the purpose of s 789 of the WR Act it is necessary to identify clearly both the person to whom an alleged threat was made (in this case Mr Holm) and the person intended thereby to be coerced into doing something. I have some doubt whether, in context, the statement above, which was attributed to Mr Manna in Mr Holm's affidavit, served to adequately identify Mr Holm as an intended object of concern in relation to union membership. 39 The more general description given by Mr Holm (set above from paragraph 27 of his affidavit) that he remembered that the threat was, effectively, to bankrupt him if he commenced working and did not join the union does not, when regard is had to the overall context, satisfactorily single out, or necessarily include, Mr Holm either in my view. However, it is not necessary to attempt any final resolution of those questions for the moment. As will become clear, I think there are other reasons to conclude that, accepting Mr Holm's evidence, Mr Manna probably had other objectives in mind than securing the union membership of Mr Holm. 40 Later that day Mr Holm had a telephone conversation with Mr Younan. In his affidavit Mr Holm said: 34. Some time later on the same day, I had a telephone conversation from [sic] Mr Younan. I cannot now recall whether I called him or he called me. We had a conversation as follows: Holm: 'I received a call from the union. They've threatened to bankrupt and audit me. They don't want us to do the job.' Younan: 'Your contract will probably be dissolved. But don't worry about it, I've found a way around it. You will still be doing the job for the same money. I'll pay your workers direct into their bank account. I'll pay their super and I'll pay you the balance was wages direct. I'll just give the union a couple of members to keep them happy. Just do what Simon [Symond] wants. Simon will ring you. Holm: 'Yes, no worries. I'll talk to you later.' (Emphasis added) 41 The statement I have emphasised is an important one. This represented the first reported complaint by Mr Holm about the conversation between him and Mr Manna. It suggests a different complexion to their conversation - namely that Mr Manna may have been more concerned with keeping Anything Concrete off the site than with the question of union membership. 42 The following day (12 April 2006) Mr Holm met with Mr Younan at about 7am. In Mr Holm's affidavit he said: 45. During this meeting, I said to Mr Younan words as follows: Holm: 'I had a call from the union and they told me they wanted all my boys to be members and that I can't do the job for that price and they will send me bankrupt. All my men have workplace agreements and there's no allowance for union dues in the quote I gave you.' 43 Mr Holm's assertion of what he said to Mr Younan is conspicuous for its absence of any suggestion that a demand was made that Mr Holm should join the union. Moreover, the reference to doing "the job for that price" seems inapt to refer to the question of union membership, as such, of those he might engage. Their union fees were not his direct responsibility. Benefits of the kind provided to employees would be. 44 Mr Younan made a note of what Mr Holm told him. That note said in part: Meeting J Younan and John Holm. … 3 During conversation between John Holm and Sammy (CFMEU) … 4. Sammy said to John a) Anything Concrete structure was not legal … d) Sammy said don't waste your money. There is no way you will be on the site unless all employees receive CBUS ACERT [sic] … (Sammy is Mr Manna, CBUS is a superannuation scheme, ACIRT is a redundancy pay arrangement) 45 This note was handwritten by Mr Younan and countersigned by Mr Holm. There was no reference in it to union membership. I think the inference is fairly available that the concern attributed to Mr Manna was with the way Anything Concrete proposed to operate, i.e. by using individual subcontractors who would not have contributions made on their behalf to CBUS or ACIRT. Those are matters which may be, but are not necessarily, questions related to union membership. 46 Mr Holm gave no additional oral evidence in chief. A good part of his cross-examination was devoted to putting to him the version of events advanced by Mr Manna, which he consistently rejected. However the following matters were put to him directly: MR PEARCE: Can I suggest to you also that at no stage in that conversation did Mr Manna tell you that you would have to join the union?---Can you repeat the question, please? Can I suggest to you that at no stage in that telephone conversation did Mr Manna tell you that you had to join the union?---That's incorrect. Can I suggest to you that at no stage did he tell you that any of your employees had to join the union?---No, that's incorrect. Well, you didn't have any employees, did you?---No. Why ask the question? Can I suggest to you that at no stage did he say to you that any of your subcontractors would have to join the union?---He said everyone would have to join the union. 47 Mr Holm was also asked about a subsequent conversation he had with Mr Symonds and Mr Younan. The relevance of this exchange is that it permits a comparison with what he said in his affidavit evidence about his conversation with Mr Younan on 12 April 2006. The exchange was: MR PEARCE: ... You didn't say to Mr Symonds and Mr Younan in that conversation that Mr Manna had demanded that you join the union?---Not in that conversation, but I'd said that to Mr Younan in a previous conversation. And you didn't in that conversation say that to Mr Symonds or Mr Younan that Mr Manna had said that your employees or your subcontractors had to join the union as well, did you?---Not in that conversation, but it was said previously. When do you say it was said previously?---When I rang up Joe and told him I'd been threatened by the union. 48 It is clear from the extract from his affidavit which I set out earlier that Mr Holm did not earlier assert that he had rung Mr Younan and said anything to him about being threatened over the question of union membership. He said Mr Manna did not "want us to do the job". A little later in the cross-examination Mr Holm was referred to Mr Younan's written note which Mr Holm had also signed and the following exchange occurred: MR PEARCE: Now, have you got that annexure in front of you?---Yes. You've agreed that you were happy to sign it?---Yes. And it was true and correct?---Yes. Do you agree with me that nowhere in that annexure is it said that Sammy Manna told you that you had to join the CFMEU or join the union?---It's not written here, but it was said. Can I suggest to you that it's not written in that annexure because you didn't say that to Mr Younan on 12 April?---No, that was said. That's why they didn't want us to do the job. and: Can I suggest to you that at no stage did Mr Manna say to you you had to join the union or your employees had to join the union, employees/subcontractors?---No, he did say that. If this was such an important aspect of the conversation, why didn't you correct annexure J and record it?---I wasn't writing it and that's what the whole conversation was about was us joining the union. and: Perhaps he'd ring you because he was concerned about the conditions of your subcontractor employees?---No, he wanted them to be all members. (Emphasis added) 49 It is hard to accept Mr Holm's outright rejection of Mr Manna's possible interest in the question of conditions and entitlements in the light of his affidavit. In his affidavit more was said (in what was attributed to Mr Manna) about conditions and entitlements than about union membership. Mr Younan's note did not record any concern about union membership but did refer to conditions and entitlements. I also confess to some doubt about the overall reliability of Mr Holm's evidence so far as it concerns the suggestion that he was personally required to become a union member. He was in the position of a working proprietor. I think it inherently less likely that Mr Manna would have been concerned with him, or about his conditions or entitlements, than he was with other persons engaged to do the job. Be that as it may, the only direct evidence about this conversation which was accepted by the FMCA was the evidence given by Mr Holm. In his cross-examination, in particular, Mr Holm was steadfast in his assertion that Mr Manna required everybody to be a union member. 50 Counsel for the appellants submitted that, despite the advantage enjoyed by the FMCA, there was sufficient doubt about the reliability of Mr Holm's evidence that, in light of the fact that the accusation against the appellants was a serious one, it should not have been accepted as establishing a breach of s 789 of the WR Act. However, some allowance must be made (and was made by the FMCA) for the circumstances in which Mr Holm first reported his complaints about the conversation to others. There is no reason to think that Mr Holm had in mind, when he recounted the substance of the conversation to Mr Younan, that proceedings under s 789 of the WR Act would be instituted as a result of the conversation with Mr Manna or that the question of a threat about union membership would come under such close scrutiny. On the other hand, even on Mr Manna's (rejected) version of the conversation, the question of union membership was a central issue - Mr Manna ascribed it to Mr Holm as the reason for the telephone call from Mr Holm. In those circumstances it would be artificial to suggest that there was no reason for the FMCA to think that union membership was discussed. Counsel for the appellants accepted that but argued that there was, nevertheless, no basis to think that there was any threat made about union membership. 51 As I said earlier, the FMCA had an undoubted advantage. The Federal Magistrate was impressed by Mr Holm. There were clearly, on the facts found by the FMCA, threats made by Mr Manna to Mr Holm about something. Notwithstanding my own doubts about this aspect of the matter it was, in my view, well within the range of findings open to the FMCA on the evidence to conclude that Mr Manna made a threat connected with union membership. On that basis it must be accepted that the overall effect of Mr Holm's evidence (as accepted by the FMCA) was that Mr Manna said that both Mr Holm and those workers engaged by him should "join the union" if Anything Concrete commenced work on the site. 52 However, this finding of fact does not conclude the question of whether a breach of s 789 of the WR Act was committed by Mr Manna (and therefore the CFMEU and the New South Wales branch).

Difficulties with the FMCA's conclusions 53 Notwithstanding the FMCA's acceptance of Mr Holm's evidence, and my acceptance that the words spoken by Mr Manna referred sufficiently to the question of union membership, there remain nevertheless the two issues I earlier identified which depend on inferences to be drawn from the accepted evidence, or on legal conclusions reached in the case, rather than on findings of fact turning on credit.

Third persons 54 I cannot find anywhere in Mr Holm's evidence, or elsewhere, an adequate foundation for the contention that Mr Manna intended that what he said would coerce persons (other than Mr Holm), who were engaged by Anything Concrete, to become members of either the CFMEU or the New South Wales branch. Accepting for the moment that Mr Manna, by the threats he made against Mr Holm and his partners, intended to effectively negate any choice Mr Holm might have about the question of union membership (a matter to which further attention needs to be given) I do not see how that circumstance could, in the present case at least, provide sufficient evidence of an intention to coerce others who had not at that stage been identified to Mr Manna. 55 The link between Mr Manna's actions and any illegitimate pressure on persons who might have been engaged by Anything Concrete to perform work on the project was not established. There was no evidence about the persons who had been engaged to work on the project, if any had been by 11 April 2006. There was no evidence of any communication to them of any statements made by Mr Manna, much less that such statements as were made to Mr Holm could represent pressure on those persons with respect to the question of union membership. Section 789 of the WR Act required a direct connection between statements made to a person and the application of illegitimate pressure to that person or to third persons. It is insufficient that the person to whom the statements were made might have a compelling reason to encourage union membership in a third party. The pressure must be felt by the third party, even though the threat was made directly to a different person. It is necessary that some direct interest of the third party be thereby engaged in a way which effectively negates the choice of that third party. Those conditions were not met in the present case. 56 However, although I think that the FMCA made an error in concluding that the respondent had proved that Mr Manna had an intent to coerce persons other than Mr Holm to join either of the unions, in view of the way the case was pleaded that does not mean necessarily that no breach of s 789 of the WR Act occurred. The FMCA found that s 789 had been breached both because of a proved intent to coerce Mr Holm and a proved intent to coerce other persons. Those allegations were made in the alternative. No complaint was made about that on the appeal. Ultimately, a single breach of s 789 was found to have been established. That conclusion may be sustained by reference, if necessary, to coercion of Mr Holm only. Counsel for the appellant accepted as much. 57 This identified error, therefore, provides no basis upon which to uphold the appeal, in whole or in part.

Mr Manna's objective 58 Although I accept the findings of the FMCA that Mr Manna's statements to Mr Holm involved threats which were connected with the question of union membership, and that Mr Manna stated to Mr Holm that his workers should join the union if Anything Concrete was to commence work on the site, that is not to say that the statements made to Mr Holm, when weighed with all the other evidence, actually disclosed any intent by Mr Manna to coerce Mr Holm (or anybody else) to become a union member. I do not think it could have been safely concluded that Mr Manna had that intent. To have that intent, Mr Manna would need to have accepted, as a real and not merely theoretical possibility, that Anything Concrete would be allowed to do the job. In my view the evidence as a whole demonstrated that Mr Manna's objective was to prevent Mr Holm, and the Anything Concrete partnership, from doing the job at all. By the evening of 11 April 2006 it appeared as though, with the co-operation of Mr Symond, Mr Manna had achieved that objective. I see no evidence that Mr Manna was prepared to contemplate an alternative position whereby he accepted Anything Concrete on the job with everybody a union member. There was no hint of that in the conversations he had with others and that was not the overall impression he left on Mr Holm. 59 As I have already indicated, Mr Holm's evidence was not simply that Mr Manna was intent on securing union membership of persons engaged by Anything Concrete. By the end of the conversation at least, Mr Holm had come to the view that Mr Manna was opposed to Anything Concrete doing the work at all. Although, in his evidence given for the purpose of the proceedings, Mr Holm connected the threats of bankruptcy, audit and "misery" to the requirement for union membership, that is not the effect of his evidence about his telephone call to Mr Younan later on the same day or the advice which he gave the following day to Mr Younan. Mr Younan's final two points in his handwritten note were as follows: 5. Sammy Manna from C.F.M.E.U. kept insisting Anything Concrete would not be on the job otherwise Anything Concrete would go bankrupt. 6. According to John he was making implications that if Anything Concrete was on site (12 Cornelia St Toongabbie) he (Sammy Manna) would make life difficult. 60 That appreciation of Mr Manna's position (that Mr Manna did not want Anything Concrete on the site at all) is consistent with other evidence given by Mr Younan about the position stated by Mr Manna in the earlier meeting with Mr Symond. In his affidavit Mr Younan gave the following evidence: 28. Also during the meeting, Mr Manna and I had a conversation as follows: Manna: 'Who's doing the concreting on the job?' Younan: 'Anything Concrete is doing the job' Manna: 'Why are you using them?' Younan: 'They did some work for me up at the Entrance. I find them to be reliable and their price is right.' Manna: 'They're no good. They can't be legit and be doing the work for you at the price they are and travelling all the way from the Central Coast and working for you at such a cheap rate. There is no way all his men are on wages, CBUS or workers comp. Here are a number of concrete companies who you should try. Can you write this down? You might find these companies more reputable. I suggest you ring one of these companies and get them to do the work for you.' 29. Mr Manna then dictated a few concrete company names and some of their telephone numbers to me which I wrote down straight away on the sheet of paper that I was using at the meeting to take notes. That sheet of paper is annexure 'G' to my affidavit. The conversation then continued as follows: Younan: 'I'll look into it. However, there is already an agreement between Conform and Anything Concrete.' Manna (grinning): 'I'm sure there's some way around that. These are better companies.' Symond: 'We need to get John [Mr Holm] on the line. There are serious issues here that need to be addressed.' (Emphasis added) 61 This conversation occurred before the discussion between Mr Manna and Mr Holm. Mr Younan's evidence about the meeting on 12 April 2006 with Mr Holm included the following: 40. On Wednesday, 12 April 2006 I left home at about 5.00am and drove to The Entrance. I arrived at The Entrance at about 6.15am. I met Mr Holm at the Decon site at Fairview Street, The Entrance at about 7.00am. Mr Holm and I were standing at the back of my ute where I had parked in the street directly opposite the Decon site. Mr Holm and I had a conversation as follows: Younan: 'Why have the unions got it in for you?' Holm: 'I really don't know. I have offered to give him all the paper work that I have given you.' Younan: 'OK. Why didn't you ring Sammy Manna back as you said you would?' Holm: 'What are you talking about? I did ring him back.' Younan: 'I heard you say yesterday that you were going to ring him not long after he had spoken to you.' 41. Mr Holm appeared shocked. He showed me the dialled number call register on his mobile phone. I checked Mr Manna's business card (which I had with me at the time) and the number Mr Holm showed me was identical to the mobile number on Mr Manna's business card. We continued our conversation as follows: Holm: 'I rang him ten minutes afterwards. Why, what's the problem?' Younan: 'Symond had rung Sammy Manna and Sammy told him he had not spoken to you.' Holm: 'That's not true, I spoke to Manna and offered to supply any documentation he wanted. He didn't seem to be concerned about anything I could give. By our conversation, he made it clear that irrespective of what paper work I supply, I won't be doing that job.' Younan: 'Hang on a sec, this is very important. Explain to me what had happened. I would like to write this down and have someone witness it.' 42. At that point I grabbed a note pad from my car and placed it on the tail gate of my ute. I wrote on the pad in point form Mr Holm's recollection of his conversation with Mr Manna the previous day. I tried to write down word for word what Mr Holm said to me but I missed words here and there because I was writing while he was speaking and I was also asking him questions. 43. When Mr Holm had finished speaking, I handed him what I had written on the note pad and said: Younan: 'Check what I have written and see if this is an accurate account of your conversation with Sammy Manna.' Mr Holm took the 2 page document that I gave him, read it and said: 'That's fine'. Our conversation continued as follows: Younan: 'Are you happy to sign it?' Holm: 'Yes, I have no problems.' (Emphasis added) 62 In the evening of 11 April 2006, after the conversation with Mr Manna, Mr Holm and his partners agreed to the formal withdrawal of their contract with Conform. They did so in response to the insistence of Mr Symond, who was giving effect to the wishes of Mr Manna. They later agreed with Mr Younan, at his request, that they would do the work in a less formal setting but there is no evidence that Mr Manna or Mr Symond became aware of that arrangement at the time. As I earlier mentioned, this arrangement itself came to an end on 10 May 2006. That was because Mr Symond, who was opposed to the use of Anything Concrete in light of Mr Manna's resistance, became aware that they were being used and expressed dissatisfaction with their work. Mr Younan, in the circumstances, agreed to terminate the arrangement completely. 63 Giving full weight to the factual findings in the FMCA I am nevertheless left with a clear impression from the evidence that Mr Manna was not engaged in any form of negotiation with Mr Holm, or stating any requirement, about the conditions on which Anything Concrete would be acceptable to work on the project. He was not intent on securing Mr Holm's membership or the membership of the workforce. Mr Manna's objective appears to have been to prevent them working on the project at all. That conclusion seems to me to be consistent with other findings made by the FMCA. 64 At paragraph 51 of the judgment of the FMCA the following conclusions were expressed: 51. On all the evidence before me, and taking into account the absence of any evidence presented by the respondents or put to Mr Holm in cross-examination giving any substance to the vague complaints made by Mr Manna to Mr Symond and Mr Younan, I find it probable that complaints about Anything Concrete were made by Mr Manna at the meeting, but that they were specious, cloaking the real objection of the two union officials to the employment of Anything Concrete on the project. This suggests that Mr Manna had a real objection to Anything Concrete which he wished to present to Mr Holm privately over the phone, and a secret purpose in wishing to speak to him in the absence of witnesses. In my opinion, the making of unfounded complaints about Anything Concrete at the site meeting lends support, and not the contrary, to Mr Holm's account of an attempted coercion of him and his workers to join the union or to abandon the contract if they did not. (Emphasis added) 65 In my respectful view, the final conclusion expressed in this paragraph does not follow sufficiently from the earlier discussion. Mr Manna's "real objection" to Anything Concrete does not give support to the idea of attempted coercion of Mr Holm, or those engaged by him, to join the union. Mr Manna's objection appears to me to be more consistent with the idea that their union membership was not Mr Manna's immediate concern. Mr Manna, it would appear, was not contemplating that Anything Concrete would come on the site with its workers being union members but was, rather, intent that Anything Concrete not be on the site at all. He preferred that someone else be engaged to do the work. 66 In my view the evidence as a whole, therefore, does not support the thesis that Mr Manna had a particular interest in securing the union membership of Mr Holm or of the persons he engaged to do the work. Mr Manna's declared position was that Anything Concrete should not be engaged on the job at all. He made that clear to Mr Symond and Mr Younan. It is an impression which he clearly left with Mr Holm who transmitted it to Mr Younan. The arrangements which were made subsequently are consistent with a desire by Mr Holm and Mr Younan to find a way around that problem. They were not, it would seem to me, directing their energies to avoiding the necessity for union membership but trying to deal with a circumstance where Mr Manna was opposed to Anything Concrete being on the job at all.

Despite error the appeal fails 67 The conclusion reached by the FMCA about Mr Manna's intent (a necessary ingredient in proving a breach of s 789) involved a process of inferential reasoning rather than a finding of primary facts. Mr Manna's words, as attributed to him by Mr Holm, are not direct evidence of an intent to coerce - that is the inference or conclusion which is drawn from the evidence. I accept, as counsel for the respondent suggested, that the FMCA enjoyed some advantages, not only in finding facts but in drawing inferences and conclusions from them. Nevertheless I would not, in ordinary circumstances, have felt it necessary to defer to those conclusions in light of my own view of the evidence despite the conscientious and thorough way in which the FMCA explained the findings which it made. 68 However, the view of the evidence which has impressed itself upon me was eschewed at the trial and explicitly disavowed on the appeal. 69 At the trial the following exchange occurred during final submissions: FEDERAL MAGISTRATE: Do you say I could draw conclusions that there were threats for reasons other than union membership? MR PEARCE: Your Honour, I'm not going to say that but there were certainly - I do say that Mr Manna had - - - FEDERAL MAGISTRATE: Is that a finding I should make? MR PEARCE: No, your Honour, I'm not going to say that but Mr Manna certainly had concerns, very big concerns for reasons other than union membership. In fact - - 70 On the appeal counsel for the appellants made it clear (more than once) that the appellants' case on the appeal rested only on the contention that Mr Holm's evidence should not be accepted. If the finding of the FMCA to accept Mr Holm's evidence was not disturbed, counsel made it clear that the appeal was lost so far as it concerned the CFMEU and Mr Manna. (The position of the New South Wales branch raises one further issue to be addressed.) 71 In the circumstances, despite my own assessment of the facts as found, I feel no alternative but to allow the result of the appeal to follow the forensic choices made by the appellants at first instance and on the appeal. As a result, the matters to which I have drawn attention do not afford a reason to uphold the appeal.

The reverse onus 72 Section 809 of the WR Act provided: 809 Proof not required of the reason for, or the intention of, conduct (1) If: (a) in an application under section 807 relating to a person's conduct, it is alleged that the conduct was, or is being, carried out for a particular reason or with a particular intent; and (b) for the person to carry out the conduct for that reason or with that intent would constitute a contravention of this Part; it is presumed, in proceedings under this Division arising from the application, that the conduct was, or is being, carried out for that reason or with that intent, unless the person proves otherwise. (2) This section does not apply in relation to the granting of an interim injunction. 73 The presumption erected by s 809 applied in the present proceedings on the face of that provision. The FMCA did not feel it necessary to rely upon it. In view of the conclusions expressed above it is not necessary for me to address the question whether it was necessary to plead reliance on s 809 to have the benefit of it, as the appellants contended. In view of the concession to which I have referred there is no foundation to disturb the finding of the FMCA that a breach of s 789 of the WR Act was established without the need to refer to s 809.

The New South Wales branch 74 It was argued by the appellants that the New South Wales branch could not be liable under the regime established by Part 16 of the WR Act (which includes s 789). The submission was based upon the contention that the WR Act provided that liability under s 789 would only attach to the CFMEU and Mr Manna. Section 789 appeared in Division 3 of Part 16 of the WR Act. Sections 782 and 783 (in Division 2 of Part 16) provided as follows: 782 Application Divisions 3 to 8 of this Part apply only to the extent provided in this Part. 783 Organisations This Part applies to: (a) conduct by an organisation; and (b) conduct by an officer of an organisation acting in that capacity; and (c) conduct carried out with a purpose or intent relating to a person's membership or non-membership of an organisation. 75 The CFMEU is an organisation within the meaning of s 783(a) and Mr Manna was an officer of the organisation within the meaning of s 783(b). The contention was, accordingly, that no conduct attributed to the New South Wales branch (an industrial association but not an organisation) was conduct to which s 789 applied. In my view the argument should not be accepted for two reasons. 76 First, s 783(c) was also apt to refer to the conduct carried out by Mr Manna. His conduct was taken to be the conduct of the New South Wales branch if it was carried out by him as an "officer of [the New South Wales branch] acting in that capacity" (s 779(2) of the WR Act). On the evidence Mr Manna had been an officer of the CFMEU and the New South Wales branch almost continuously for about 29 years. In that capacity he concerned himself with questions of union membership. I do not accept, on the facts of the present case, that he could not have been acting in the capacity of an officer of the New South Wales branch when he did something with respect to membership of the CFMEU or vice versa (cf. Hadgkiss v Sunland Constructions Pty Ltd (2007) 158 FCR 193; (2007) 161 IR 317 at [45]-[46]). In the present case it seems clear that the two associations were involved in a joint enterprise so far as the encouragement of union membership was concerned and Mr Manna was their joint officer for that joint purpose. 77 Secondly, as contended by a Notice of Contention filed in the appeal, a sufficient connection to the New South Wales branch, having regard to Mr Manna's conduct which is to be imputed to it, arises from s 785 of the WR Act, which applies Part 16 of the WR Act as follows: 785 Constitutional corporations (1) This Part applies to the following conduct: ….. (f) conduct carried out with intent to directly affect a person in the capacity of: … (ii) a contractor, or prospective contractor, of a constitutional corporation; 78 The partners of Anything Concrete contracted with Conform, which itself took a contract from North East. The matters pleaded in the amended statement of claim alleged sufficient material facts which would, if proved, sustain a conclusion that Conform and North East were each constitutional corporations. The evidence sufficiently proved those facts. That was sufficient to engage the operation of s 785(1)(f)(ii) with the result that the New South Wales branch was not outside the operation of Part 16 of the WR Act. 79 As a result, there is no separate basis to dismiss the proceedings against the New South Wales branch.

Conclusion 80 A challenge to the penalties imposed was withdrawn by the written submissions filed for the appellants. The arguments upon which the appellants rely having been rejected, the appeal should be dismissed. I certify that the preceding eighty (80) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Buchanan.

Associate: Dated: 10 February 2011 IN THE FEDERAL COURT OF AUSTRALIA NSW DISTRICT REGISTRY FAIR WORK DIVISION NSD 1272 of 2009

ON APPEAL FROM THE FEDERAL MAGISTRATES COURT OF AUSTRALIA

BETWEEN: CONSTRUCTION, FORESTRY, MINING & ENERGY UNION

CONSTRUCTION, FORESTRY, MINING & ENERGY UNION (NSW BRANCH)

JUDGES: BUCHANAn, FLICK AND KATZMANN JJ DATE: 10 FEBRUARY 2011 PLACE: SYDNEY

FLICK J: 81 This is an appeal from two decisions of a Federal Magistrate, the first given on 10 July 2009 (Alfred v Construction, Forestry, Mining & Energy Union [2009] FMCA 613, 185 IR 325); the second given on 20 October 2009 (Alfred v Construction, Forestry, Mining & Energy Union (No 2) [2009] FMCA 1003). 82 The Notice of Appeal was filed in this Court on 10 November 2009 and the Respondent filed a Notice of Contention on 18 December 2009. 83 The opportunity has been taken to read the reasons for decision of Buchanan J. His Honour's careful and detailed review of the evidence advanced before the Federal Magistrate removes any necessity to again do so. 84 Concurrence is expressed with the conclusion of Buchanan J that the appeal is to be dismissed. 85 Less reservation is experienced, however, in reaching that conclusion than that expressed by Buchanan J, primarily because of two inter-related considerations, namely: the necessity for the Appellants to establish "appellable error" on the part of the Federal Magistrate and their failure to do so; and the manner in which the proceeding was conducted before the Federal Magistrate and the confined issues raised for resolution on appeal. 86 The jurisdiction presently being exercised in this appeal is that conferred by s 24(1)(d) of the Federal Court of Australia Act 1976 (Cth), namely the jurisdiction to hear and determine appeals from judgments of the Federal Magistrates Court. 87 That jurisdiction is in the nature of a complete re-hearing: Farrington v Deputy Commissioner of Taxation [2002] FCA 1013, 50 ATR 429 per Kenny J; Kowalski v Domestic Violence Crisis Service [2005] FCA 12 at [51] per Madgwick J. See also: Branir Pty Ltd v Owston Nominees (No 2) Pty Ltd [2001] FCA 1833, 117 FCR 424. 88 The jurisdiction nevertheless remains an appellate jurisdiction which is to be exercised for the correction of error: cf. Dovuro Pty Ltd v Wilkins [2000] FCA 1902 at [38], 105 FCR 476 at 487 per Branson J; Knight v Beyond Properties Pty Ltd [2007] FCAFC 170 at [20], 242 ALR 586 at 591. And, when conducting the re-hearing, it was common ground that the approach which this Court should pursue when reviewing the findings of fact as made by the Federal Magistrate was the approach as summarised in the majority judgment of Gleeson CJ, Gummow and Kirby JJ in Fox v Percy [2003] HCA 22 at [30] and [31], 214 CLR 118 at 128 to 129. It was recognised in that decision that "mistakes … can occur at trial in the comprehension, recollection and evaluation of evidence": Fox v Percy, supra at [24]. A "real review", it was said, must be undertaken on appeal: at [25]. The task entrusted to the appellate court is to conduct "a real rehearing": CSR Ltd v Della Maddalena [2006] HCA 1 at [16], 224 ALR 1 at 7 per Kirby J. See also: Kovan Engineering (Aust) Pty Ltd v Gold Peg International Pty Ltd [2006] FCAFC 117 at [117] per Allsop J. 89 In undertaking that task, the Court is to determine whether the findings made are correct but it is not the function of the appellate court "merely to substitute its own view, as if it were again performing the function of the trial judge": cf. Wade v Australian Railway Historical Society (South Australian Division) (t/as Steamranger) [2000] SASC 233 at [38], 77 SASR 221 at 227 per Doyle CJ (Duggan and Lander JJ concurring). Nor is it appropriate to invite an appellate court "simply to revisit the relevant evidence … and then contend that the court should reach a different conclusion … In an appeal by way of rehearing, error must be demonstrated for the appellate court to be entitled to disturb the decision of the primary decision-maker… Furthermore, the manner in which the case is conducted by the parties on appeal ought not depart from the manner in which the case was conducted at trial, and generally, the appeal arena is not the appropriate forum to raise new arguments": cf. Tasmanian Sandstone Quarries Pty Ltd v Legalcom Pty Ltd [2010] SASCFC 6 at [34] per Gray J (Nyland and Kourakis JJ agreeing). 90 The passage which assumed particular importance in the hearing of the present appeal was that of Gleeson CJ, Gummow and Kirby JJ in Fox v Percy - namely the ability to revisit on appeal a finding which is "glaringly improbable" or "contrary to compelling inferences": Fox v Percy at [29]. See also: Li Pei Ye v Crown Ltd [2004] FCAFC 8 at [104] to [107] per Sackville, Selway and Lander JJ; Jardein Pty Ltd v Stathakis [2007] FCAFC 148 at [23] to [24] per North, Weinberg and Middleton JJ. "Consistent with the principles of appellate review", findings of fact "cannot be set aside on appeal merely by identifying evidence which, if accepted, was capable of supporting contrary findings": Yousif v Commonwealth Bank of Australia [2010] FCAFC 8 at [34], 193 IR 212 at 221 per Kenny, Tracey and Jagot JJ. Leveraged Equities Ltd v Goodridge [2011] FCAFC 3 provides an instance where a finding made by the primary Judge was set aside. Jacobson J (with whom Finkelstein and Stone JJ agreed) there concluded that "there were incontrovertible facts and uncontested testimony which demonstrates that the primary Judge's conclusion was erroneous": at [391]. His Honour was of the view that "this was a case where contemporary materials, objectively established facts and the apparent logic of events pointed only in one direction": at [405]. 91 The acceptance by the Federal Magistrate in the present proceeding of the account given by Mr Holm of the 11 April 2006 conversation - and, in particular, that part of the conversation when Mr Manna told Mr Holm that he would send him bankrupt "if you proceed with the job and do not join the union" - was said by the Appellants to be "glaringly improbable" or "contrary to compelling inferences" by reason of: the contrary evidence of Mr Manna; inferences which were said to be consistent with the evidence of Mr Manna; and inferences which were said to be inconsistent with the evidence of Mr Holm. Importantly, before the Federal Magistrate, no finding of fact was sought by the now Appellants that the words attributed to Mr Manna "were threats for reasons other than union membership". And, on appeal, the essential issue to be resolved reduced itself to the Federal Magistrate's acceptance of the evidence of Mr Holm in preference to that of Mr Manna. That was said to be the "appellable error" that occurred. 92 None of the arguments now advanced for resolution on appeal are accepted. Indeed, it is respectfully considered that such submissions as were advanced on behalf of the Appellants do not go beyond the Appellants seeking a further opportunity to make further submissions with the hope that a different conclusion may be reached by a Court differently constituted. 93 No appellable error is discernible. 94 The expressions used by Gleeson CJ, Gummow and Kirby JJ in Fox v Percy - namely findings that may be "glaringly improbable" or "contrary to compelling inferences" - were obviously expressions deliberately employed to emphasise the "quite rare case" in which an appellate court would interfere with factual findings. But those expressions are not to be elevated to the status of a statutorily prescribed standard to be universally applied. Every case must necessarily depend upon its own facts. It would nevertheless be an error of principle for an appellate court to interfere with factual findings made by a Federal Magistrate merely because it may have drawn different inferences. Even if an appellate court may be inclined to draw different inferences, or would indeed itself have made different findings to those made by a primary Judge, this does not make the contrary findings made at first instance findings that are "glaringly improbable" or (for present purposes) findings which expose appellable error. 95 The forum in which factual findings are to be made is normally before a court at first instance. It is in this forum that all parties have the opportunity to advance submissions which they consider best advance their respective interests. Reasons for decision and findings of fact are then made founded upon the submissions advanced. An appeal - even an appeal by way of re-hearing - is not to be used as the vehicle whereby the losing party at first instance can thereafter take the benefit of such findings of fact as are made in its favour and avail itself of a further opportunity to then make more detailed submissions directed to those findings which it wishes to impugn. The opportunity to advance all submissions as to the findings which should be made is an opportunity to be availed of at first instance; it is not an opportunity reserved only to be pursued on appeal. The benefit of hindsight may provide the window whereby a party may perceive deficiencies in its case as previously advanced and have those deficiencies brought into the light. But hindsight does not necessarily expose "appellable error". Nor is an appeal in the nature of a re-hearing an opportunity to attempt to re-characterise the facts which were presented for resolution at first instance. 96 For the purposes of the present appeal, it may be accepted that a failure on the part of a judge to refer to evidence of particular significance (perhaps even evidence not referred to by the parties in their submissions) may potentially expose appellable error. Appellable error may also be exposed where "reliance has been placed on key evidence wrongly admitted or key evidence wrongly excluded when such evidence is pivotal to the result" (Devers v Kindilan Society [2010] FCAFC 72 at [48], 269 ALR 404 at 415 per Ryan, Mansfield and McKerracher JJ) or by a failure to refer to a submission of particular significance. 97 Counsel for the Appellants in the present case, with great respect, advanced all such submissions as could possibly be advanced in support of the appeal. Those submissions contended, for example, that there was inconsistency in the evidence where there was (upon analysis) no such inconsistency. The submissions again sought to emphasise the fact that Mr Holm in his evidence before the Federal Magistrate gave an account of what was said on 11 April 2006 but made no reference to some of those facts in a note signed on 12 April 2006. The submissions also sought to take issue with particular statements made by the Federal Magistrate and to contend that those statements were devoid of evidential support. 98 But the Appellants, with respect, fell well short of pointing to "incontrovertible facts or uncontested testimony [demonstrating] that the trial judge's conclusions are erroneous" or that his findings are "glaringly improbable" or "contrary to compelling inferences": Fox v Percy at [29]. 99 One simple fact remains an insurmountable obstacle to success on the part of the Appellants - the Federal Magistrate accepted Mr Holm's account of the 11 April 2006 conversation and rejected the account and the evidence of Mr Manna. That was a decision open to the Federal Magistrate and was a decision supported by the inferences he drew from the other evidence before him. 100 It is thus also concluded that the appeal should be dismissed. I certify that the preceding twenty (20) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Flick.

Associate: Dated: 10 February 2011 IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY FAIR WORK DIVISION NSD 1272 of 2009

ON APPEAL FROM THE FEDERAL MAGISTRATES COURT OF AUSTRALIA

BETWEEN: CONSTRUCTION, FORESTRY, MINING AND ENERGY UNION

CONSTRUCTION, FORESTRY, MINING AND ENERGY UNION (NSW BRANCH)

JUDGES: BUCHANAN, Flick and Katzmann JJ DATE: 10 February 2011 PLACE: SYDNEY

REASONS FOR JUDGMENT KATZMANN J: 101 In the Federal Magistrates Court Gregory Charles Alfred ("the prosecutor") applied for penalties and other orders for alleged breaches by the appellants of s 789 of the Workplace Relations Act 1996 (Cth) ("the Act") on 11 April 2006. 102 At the relevant time s 789 of the Act (which appears in Division 3 of Part 16) provided: 789 Coercion (1) A person must not organise or take, or threaten to organise or take, any action against another person with intent to coerce the other person or a third person: (a) to become, or not become, an officer or member of an industrial association; or (b) to remain, or cease to be, an officer or member of an industrial association. (2) Subsection (1) is a civil remedy provision. 103 Section 782 provided that Divisions 3 to 8 of Part 16 apply only to the extent provided in Part 16. Section 783 relevantly provided: 783 Organisations This Part applies to: (a) conduct by an organisation; and (b) conduct by an officer of an organisation acting in that capacity; and (c) conduct carried out with a purpose or intent relating to a person's membership or non-membership of an organisation. 104 The prosecutor pleaded that the third appellant, Mr Manna, an employee of both the first and second appellants (the federal union - "the CFMEU" - and its NSW State branch respectively), threatened Mr Holm with the intention of coercing him and/or his employees and/or subcontractors to become members of the CFMEU and/or its State branch. The relevant pleading appears in paragraph 6 of the judgment of Buchanan J. The evidence of the threat was given by Mr Holm in an affidavit. He said that he received a telephone call on 11 April 2006 while he was driving. He said he did not answer the phone but called the missed number a few minutes later and spoke to a person whom he later identified as Mr Manna. The detail of the conversation appears in paragraph 37 of Buchanan J's judgment. 105 There was no dispute that Mr Holm telephoned Mr Manna and had a conversation with him that afternoon. The dispute turned on the substance of the conversation. Mr Manna denied uttering any threat. 106 The Federal Magistrate preferred the evidence of Mr Holm, made favourable findings about his credibility and demeanour, and unfavourable findings about the credibility and demeanour of Mr Manna. He held that Mr Manna contravened s 789 in a mobile phone conversation by threatening Mr Holm with the words: "If you proceed with the job and do not join the union, pay your men the benefits, we'll send you bankrupt", "have you audited" and "screw you and make your life a misery". 107 The first and second appellants were also held to be liable for the conduct of Mr Manna by the operation of s 779(2) of the Act, which deems conduct by an officer or agent of an industrial association acting in that capacity to be conduct of the association. 108 Following a separate hearing his Honour went on to impose fines on all three appellants. 109 The appellants appeal against the convictions. An appeal on penalty was not pressed. 110 As Flick J observes at [87] of his reasons, the appeal is in the nature of a rehearing. A rehearing is not a completely fresh hearing of all the evidence. Error must still be shown in the decision of the primary judge. The Court is bound to conduct a real review of the trial and the judge's reasons. If, making proper allowances for the advantages enjoyed by the trial judge, the Court finds error, it is not merely authorised but obliged to come to its own decision, including drawing the proper inferences from undisputed or established facts. The mere fact that the trial judge favoured the witnesses of one party over those of another cannot prevent an appellate court from performing its statutory function. That will be so even in the case of credibility findings where "incontrovertible facts" or uncontested testimony prove them to be wrong. "Ritual incantation" about witness credibility (or demeanour) does not relieve the appellate court of its responsibility. What is more, [i]n some, quite rare, cases, although the facts fall short of being "incontrovertible", an appellate conclusion may be reached that the decision at trial is "glaringly improbable" or "contrary to compelling inferences" in the case. In such circumstances, the appellate court is not relieved of its statutory functions by the fact that the trial judge has, expressly or implicitly, reached a conclusion influenced by an opinion concerning the credibility of witnesses. In such a case, making all due allowance for the advantages available to the trial judge, the appellate court must "not shrink from giving effect" to its own conclusion. Fox v Percy (2003) 214 CLR 118 at 126-128, [2003] HCA 22, and especially at [28]-[29] per Gleeson CJ, Gummow and Kirby JJ. The question, here, is whether this is one of those "quite rare" cases. 111 The appellants' argument is that the Federal Magistrate's conclusion that Mr Manna threatened Mr Holm in the mobile phone conversation by using the words Mr Holm said he used was "glaringly improbable and/or contrary to compelling inferences". It is true, as Buchanan J points out (at [15] of his Honour's reasons), that the resolution of the conflict between the evidence of Mr Holm and the evidence of Mr Manna depended very substantially on an assessment of the credit of each of them. But it did not only rest on the Federal Magistrate's assessment of the two protagonists. It also depended on the evidence given by an independent witness, Mr Younan, whose company had contracted with Mr Holm's, to do the concreting work on the Toongabbie site and whom the prosecutor called to corroborate Mr Holm. 112 In essence, the appellants' case is that Mr Holm should not have been believed because his evidence was not only inconsistent with the evidence of Mr Manna but also with the evidence of Mr Younan, particularly his uncontested evidence of a contemporaneous record he made of what Mr Holm told him the day after the alleged threat had been uttered. Counsel submitted that that evidence made Mr Holm's account "glaringly improbable". He also submitted that the Federal Magistrate's conclusions were affected by a number of appealable errors. 113 In my respectful opinion, the Federal Magistrate did fall into error. The errors largely relate to the way in which his Honour dealt with the evidence of Mr Younan. That evidence did support Mr Holm's evidence but only up to a point. 114 Mr Younan gave evidence that he met with Mr Holm at about 7.00 am the day after the conversation between Mr Manna and Mr Holm. He said he asked Mr Holm: "Why have the unions got it in for you?" He said that Mr Holm replied: "I really don't know. I have offered to give him all the paper work that I have given you." He said that he then asked him why he had not telephoned Mr Manna. Mr Holm protested that he had and showed Mr Younan his mobile phone to prove that the call had been made. Then Mr Younan said this exchange occurred: Holm: ... I spoke to Manna and offered to supply any documentation he wanted. He didn't seem to be concerned about anything I could give. By our conversation, he made it clear that irrespective of what paper work I supply, I won't be doing that job. Younan: Hang on a sec, this is very important. Explain to me what had happened. I would like to write this down and have someone witness it. 115 Mr Younan said he tried to write down what Mr Holm was saying "word for word" but "missed words here and there". In cross-examination he said he decided to write down what Mr Holm was telling him because it seemed important and he "smelled a rat". He said he felt that "someone was - going to - well, someone was trying to get shafted". 116 The memorandum was in the following terms: 12.04.06 Meeting J Younan & John Holm 1. John Rang Sammy Manna on 11.04.06 at about 2pm which was 5-10 mins after S Symond rang John and asked John to ring Sammy (CFMEU) straight away. 2. Sammy spoke to S Symond and said John did not ring straight away but about 1½ hrs later. 3. During conversation between John Holm and Sammy (CFMEU) which lasted about 20 mins (can be verified by phone records). 4. Sammy said to John (a) Anything Concrete structure was not legal. (b) John said to Sammy he as (Anything Concrete) was legal as workers comp did an audit early 2005 and it was found that Anything Concrete was entitled for a refund (c) John told Sammy that he was happy to pay for the CFMEU (Union) to do an audit. (d) Sammy said don't waste your money, there is no way you will be on the site unless all employees receive CBUS, ACERT [sic]. (e) He said it would cost a lot more to get the concreting done than what you quoted. (f) Sammy also told John that he couldn't pay the travelling time from Central Coast to Sydney. (g) John said it takes less time for us to get to Toongabbie from the Central Coast than it does to get across Sydney. 5. Sammy Manna from CFMEU kept insisting Anything Concrete would not be on the job otherwise Anything Concrete would go bankrupt. 6. According to John he was making implications that if Anything Concrete was on site (12 Cornelia St Toongabbie) he (Sammy Manna) would make life difficult. 117 In his affidavit Mr Younan said that after Mr Holm had finished speaking he handed him what he had written and asked him to check it "and see if this is an accurate account of your conversation with Sammy Manna". He said Mr Holm then took the two page document, read it and said "that's fine". He asked him whether he was happy to sign it and Mr Holm said "Yes, I have no problems". He then (with Mr Holm's consent) arranged for the memorandum to be witnessed. 118 In his affidavit Mr Holm stated that he said to Mr Younan words to the following effect: I had a call from the union and they told me they wanted all my boys to be members and that I can't do the job for that price and they will send me bankrupt. All my men have workplace agreements and there's no allowance for union dues in the quote I gave you. 119 In his oral evidence Mr Holm said that at the meeting with Mr Younan he informed him that Mr Manna had told him he had to join the union. He insisted "that's what it was all about. That's why we were doing the letter" (presumably referring to the memorandum). 120 Despite the absence in the memorandum of any reference to a desire, let alone a demand, for union membership, Mr Holm agreed that he said he had no problems with it. He signed it having read it and after Mr Younan had asked him to check what had been written and see if it was an accurate account of the conversation with Mr Manna, although his evidence was that he read it as Mr Younan was writing it. 121 The errors appear in the following passages from his Honour's reasons. I shall deal with them in sequence. The first appears in paragraph 66. 66. The respondents' submissions gave great emphasis to the absence in Mr Younan's memorandum of express reference to Mr Manna conditioning his threats to Mr Holm upon a refusal to join the union. I have given careful consideration to the significance of this point, before accepting Mr Holm's evidence as to what was said to him by Mr Manna. Nowhere was it suggested in cross examination of Mr Younan that Mr Holm made no mention to him that Mr Manna's threats included statements demanding that Mr Holm and his workers should join the union, and I would not draw any conclusions as to how Mr Younan might have responded to this point, if it had been squarely put to him. (Emphasis added) 122 There was no obligation on counsel for the appellants to put to Mr Younan in cross-examination that Mr Holm made no mention to him that Mr Manna demanded that he and his workers join the union because nowhere in his evidence had he indicated otherwise. If there was any obligation, it was on the prosecutor to explain the apparent inconsistency between the two accounts. 123 More than one error appears in paragraph 67. 67. I have above referred to Mr Holm's evidence that he made known to Mr Younan that Mr Manna's threats arose out of a demand that Mr Holm and his workers should join the union, notwithstanding that the relevant words he now attributes to Mr Manna are not recorded in Mr Younan's memorandum. There is a suggestion in the memorandum of an attempted coercion to join the union and pay union "extra" benefits, in paragraph 4(d), since "ACIRT" is a union sponsored redundancy payments trust, and "C.B.U.S" is a union supported superannuation fund. There is also a clear indication in paragraphs 5 and 6 that Mr Manna's threats arose out of Mr Holm's refusal to accept that his workers should receive benefits which would follow from union membership. I therefore do not accept that there is any direct inconsistency between Mr Younan's memorandum and Mr Holm's evidence to the Court. To the contrary, I consider that it provides general support for Mr Holm's evidence. (Emphasis added) 124 This was not the only time his Honour referred to "union extras". At [50] of his reasons he said that Mr Holm maintained his perception that the only grievance the union had about him and his firm was that its workers were not members of the union receiving "union extras". It was not put to Mr Holm in cross-examination that, in fact, the union had a reason to want his firm excluded from the site, other than the absence from its workforce of union members receiving "extra benefits". 125 Presumably the use of inverted commas at that point was designed to reflect the oral evidence Mr Holm had given of his belief that the entitlements he said Mr Manna referred to were benefits of union membership. Further on in his reasons his Honour abandoned the use of the inverted commas, accepting Mr Holm's belief as fact. That is clear not only from the passage at [67] set out above. At [87], for example, he found that Mr Manna "had offered Mr Holm an alternative method of placating the union by his becoming a member and paying union benefits" (emphasis added). This was one of the matters upon which he relied to conclude that "the proscribed intention … was a "substantial or operative" intention at the time the relevant words were spoken". And he also relied upon it to conclude that Mr Manna intended not only to coerce Mr Holm to join the union but also his workers, saying: In my opinion, Mr Manna intended to prevent concreting workers being employed on the project who did not receive the union supported benefits, and it seems likely that he also expected their employer to procure their joining the union as part of the benefits which he was promoting. 126 His Honour took it that ACIRT (an acronym for Australian Construction Industry Redundancy Trust) and CBUS (an industry superannuation fund) were benefits paid only to union members. This was a misconception. It appears to derive from an answer Mr Holm gave in cross-examination when referring to a statement he said he made to Mr Manna, that for the price he had signed the contract he couldn't do the work "with all the union's extras", which, when pressed he said were "Cert [sic, presumably ACIRT] and C+BUS [sic] and to make all men employees". He later added: "site allowance, travel time and wet days and things like that." At one point he said "union extras" are "the fees you've got to pay when the union comes on the job". 127 This Court was told that such benefits are paid to all workers regardless of union membership. And so was his Honour. Mr Pearce, who appeared for the appellants before us and in the Court below, explained to the Federal Magistrate: CBus is the superannuation, your Honour, and ACIRT are redundancy payments. And I can assure your Honour that non-unionists get CBus and ACIRT, you don't have to be a member of the union to get it. In fact you don't even have to work in the building industry to be a member of CBus as I told your Honour the other day. It's got nothing to do with union membership. It's about superannuation. 128 Counsel for the prosecutor did not suggest otherwise. 129 There was some evidence to support this. Enterprise agreements entered between the union and a number of different concreting contractors were in evidence. They included terms requiring the payment of such benefits and they bound, not merely the union, but all employees of the companies engaged in any of the occupations, callings or industries specified in the National Building and Construction Industry Award. 130 Thus, the record Mr Younan made of the demand allegedly made on Mr Holm was that the workers had to receive certain lawful entitlements, or at least entitlements payable to employees. It was, in my view, incapable of giving rise to the suggestion the Federal Magistrate drew from it "of an attempted coercion to join the union and pay union 'extra' benefits". 131 The proposition that paragraphs 5 and 6 of the memorandum provide "a clear indication" that the threats arose out of Mr Holm's refusal to accept that his workers should receive benefits which would follow from union membership is demonstrably false. 132 His Honour later said (at [68]) that Mr Holm "at all times was firmly of the belief that it was obvious to everyone, and to Mr Younan and Mr Symond in particular, that Mr Manna's threats were made with an intent to coerce Mr Holm and his workers to join the union or abandon the project". His Honour then asserted that that conviction "probably meant that this was not something he thought necessary to dwell on nor explain to Mr Younan in detail at any stage". The trouble with this explanation is twofold. First, Mr Holm's evidence was that he had spoken to Mr Younan twice about the subject, once in a telephone call the same day Mr Manna made the threats and the next day when the memorandum was taken and that the requirement of union membership was what it was "all about". Under cross-examination he claimed to have told Mr Younan of it in a previous conversation. But the only previous conversation about which he gave evidence did not include any reference to it. The account in his affidavit of the first conversation (which, as Buchanan J points out at [41] of his reasons, is the first reported complaint about Mr Manna's call) does not mention a demand for union membership. Secondly, Mr Younan's evidence did not reflect any knowledge that the threat concerned union membership. Mr Symond did not give evidence and no explanation was given for his absence. 133 The Federal Magistrate was very favourably impressed with Mr Holm's demeanour and not at all impressed with Mr Manna's, and due weight must be given to his Honour's impressions. But, as the plurality noted in Fox v Percy at [30], demeanour is not everything and there are dangers about too readily drawing conclusions about the truthfulness and reliability of witnesses solely or mainly from their appearances. A proper evaluation of Mr Holm's evidence required an accurate comparison with Mr Younan's. The Federal Magistrate recognised this when he said at [44] of his reasons: ... if the factual dispute between Mr Holm and Mr Manna is resolved by reference to the credibility of their separate presentation of their evidence, I would confidently resolve it in favour of Mr Holm. However, as I have noted above, it is not enough for me to discount the evidence of Mr Manna. I must be positively, and comfortably, satisfied as to the truth of Mr Holm's recollection of threatening words being spoken as alleged. I can only achieve that satisfaction if, as well as finding Mr Holm to be a convincing witness, I accept that his evidence is consistent with "contemporary materials, objectively established facts and the apparent logic of events". In particular, I need to consider whether it is supported by, or inconsistent with, the evidence of the corroborative witness called by the applicant, and his contemporaneously prepared memoranda.... (Emphasis in original) 134 Having considered Mr Younan's evidence his Honour said: 68. Assessing the evidence of both witnesses about their meeting at The Entrance on 12 April 2006, I conclude that Mr Holm at all times was firmly of the belief that it was obvious to everyone, and to Mr Younan and Mr Symond in particular, that Mr Manna's threats were made with an intent to coerce Mr Holm and his workers to join the union or abandon the project. This conviction probably meant that this was not something he thought necessary to dwell on nor explain to Mr Younan in detail at any stage. 69. Mr Younan's opinions over the relevant period about the union's purposes for objecting to Anything Concrete were not explored in evidence, and are unclear. During all the discussions to which he was privy on 11 April 2006, he seems to have been left unsure about the true reasons for the union hostility to Anything Concrete, and he was keen to get Mr Holm's account of this from him. Mr Younan's apparent concern in making a memorandum was to record a chronology of events and the threats which had been made, not their expressed or implicit intent or motivation on the part of Mr Manna and his union. This is clear from his memorandum. He was not legally trained, and is unlikely to have understood that the stated or apparent reasons for Mr Manna's threats was something which should be recorded. (Emphasis added) 135 Mr Younan's opinions about the union's purposes would have been inadmissible. Why his Honour raised the subject is obscure. If, however, Mr Younan was keen to get Mr Holm's account of those reasons from him, as his Honour noted, and if part of Mr Younan's concern in making the memorandum was to record "the threats which had been made", it is surprising, to say the least, that he did not make any note or give any evidence that Mr Holm told him the threat had involved a demand for union membership. On the prosecutor's case and on Mr Holm's evidence, this was not merely the reason for the threat but part of its text. Indeed, the prosecutor relied upon the words Mr Holm attributed to Mr Manna to show that the appellants had the necessary intent. What is more, his Honour took the view that "the case essentially turns upon my satisfaction that these words were actually said by Mr Manna". 136 His Honour went on to conclude: 70. In all these circumstances, I am not persuaded that Mr Holm did not convey to Mr Younan at their meeting on 12 April 2006 that Mr Manna's threats were accompanied by words which indicated that they were conditioned upon Anything Concrete remaining in the project without its workers joining the union. I would not find that the record made by Mr Younan establishes that words expressing this were not spoken by Mr Manna to Mr Holm, nor reject Mr Holm's evidence that the words he attributes to Mr Manna were spoken to him. 137 This arguably reverses the onus of proof. 138 If, as Mr Holm said in evidence "that's what the whole conversation was about was about us [sic] joining the union", it is difficult to understand why Mr Younan would not have adverted to it in his statement to the prosecutor, his affidavit and, in particular, his contemporaneous note. The references to employee benefits do not assist because it was common ground that the two of them discussed such things and, contrary to what the Federal Magistrate mistakenly believed, employee benefits were unrelated to union membership. It is possible that Mr Holm's evidence in this regard was an exaggeration. It is also possible that it was an honest mistake. On the other hand, Mr Younan did not create a transcript of the conversation he had with Mr Holm. As I mentioned earlier, he said he tried to write down what he was saying "word for word" but "missed words here and there". In cross-examination he said he was as careful as he could be to write down the words but did not write shorthand. Still, he agreed that the note was "a complete record" of the "important" things that were said. It is conceivable that he did not regard the question of union membership as important. That would explain why he did not include such a reference in the first place. But it does not explain why, when Mr Holm checked it, he did not see to it that it included what he regarded was at the heart of the threat. This evidence has troubled me. Ultimately, however, I have concluded that the inconsistency between Mr Holm's and Mr Younan's evidence is more apparent than real. It is entirely plausible that if, as Mr Holm told his Honour, he believed that CBUS and ACIRT, travel time and other benefits payable to employees were "union extras" (and it was not suggested to him in cross-examination that that evidence was dishonest), he also believed at the time that the memorandum captured the essence of the threat. 139 There is, therefore, a rational explanation for the absence in the memorandum of the reference to union membership. Furthermore, in critical respects, as his Honour observed, Mr Younan's account was broadly consistent with Mr Holm's account, certainly more consistent with it than with Mr Manna's, who had denied making any threat at all. As his Honour said at [71] of his reasons: What is made irrefutably clear from Mr Younan's notes, and from my acceptance of Mr Younan as a disinterested witness whose notes can be accepted as contemporaneous records, is that Mr Manna's disclaimer of having made any threats to Mr Holm to induce his abandonment of his contract cannot be accepted. 140 Counsel for the appellants did not challenge any part of Mr Younan's evidence, but in cross-examination Mr Manna denied, not only Mr Holm's version of the conversation with him, but also Mr Younan's evidence about other conversations to which he was a party. The Federal Magistrate's conclusion that Mr Manna's evidence was "entirely unreliable" was a conclusion open to him on the evidence. The evidence Mr Younan gave about the conversation with Mr Holm was not inconsistent with Mr Holm's account and it was generally corroborative of it, although it did not, in terms, provide corroboration of the union content of the threat. 141 The appellants also complained about the Federal Magistrate's reasons at [53]. There his Honour said he was inclined to prefer Mr Holm's recollection where it differed from Mr Younan's because Mr Holm was "more confident in his recollections than Mr Younan and also because Mr Younan participated in much longer and more numerous discussions that day and it is quite possible that Mr Younan's memory of what was said in particular conversations might be confused". The appellants submitted "there was no evidence whatsoever of other conversations … and the proposition was never tested by Smith FM with Younan or indeed Holm". I take his Honour's finding to refer to discussions about the matters relevant to the proceeding. In my view, the finding that Mr Younan participated in much longer and more numerous discussions that day was open from the affidavit evidence, although there was no exploration of the number and length of Mr Holm's discussions. The speculation at the end of the sentence is no more than a commonsense observation. 142 The appellants also submitted that it was not open to the Federal Magistrate to find, as he did (at [57]), that Mr Younan's evidence "probably compressed a series of conversations" and he was "involved in very protracted discussions with Mr Symond and others, throughout the afternoon, about how to deal with the union's opposition to Anything Concrete". They contended that the only evidence to which His Honour referred that might support the finding is confined to "the one conversation on 11 April". But it is obvious from Mr Younan's evidence that there were a number of conversations or discussions that afternoon. In my view this finding was also open to his Honour. 143 I have given careful consideration to the other alleged errors to which the appellants pointed in their written submissions. In my opinion, however, none of the other challenges to his Honour's conclusions, even if accepted, is sufficient to overcome the very great advantage the Federal Magistrate enjoyed over this Court in resolving the conflict between the competing versions of events. 144 For these reasons, in spite of the errors to which I have referred, I am not satisfied that the appellants have shown that the finding of the Federal Magistrate that Mr Manna threatened Mr Holm by using the words Mr Holm attributed to him in his affidavit was either glaringly improbable or contrary to compelling inferences. Nor am I satisfied that the finding was demonstrably wrong in the face of "incontrovertible facts" or uncontested testimony. Counsel for the appellants conceded that if the Court did not disturb this finding, the appeal must fail. 145 I agree with Buchanan and Flick JJ on the subject of the liability of the New South Wales branch and on the question of Mr Manna's objective and respectfully adopt the reasons of Buchanan J at [58]-[71] and at [75]-[78]. 146 I, therefore, agree that the appeal must be dismissed. I certify that the preceding forty-six (46) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Katzmann.