Craig v South Australia

THE COURT Introduction These proceedings involve an application by the Construction, Forestry, Mining and Energy Union ("CFMEU") and two other organizations of employees for writs of prohibition, mandamus and certiorari directed to members of the Australian Industrial Relations Commission ("the Commission"). The application arose from proceedings in the Commission initially heard and determined by Justice Boulton who made orders under s 170MW(1) of the Workplace Relations Act 1996 ("WR Act"). The employer affected by those orders was Coal & Allied Operations Pty Limited ("Coal & Allied"). On 10 November 1997 Coal & Allied instituted an appeal to a Full Bench against those orders. On 29 January 1998 a Full Bench constituted by the President, Justice Giudice, Justice Munro and Commissioner Larkin made orders quashing the orders of Justice Boulton. In these proceedings the applicants challenge the decision and orders of the Full Bench. The High Court by order of McHugh J on 23 March 1998 remitted to this Court the further proceedings in the application by the Construction Forestry Mining & Energy Union ('the CFMEU') the Automotive Food Metal Engineering Printing & Kindred Industries Union ('the AFMEPKIU'), and the Communications Electrical Electronic Energy Information Postal Plumbing & Allied Services Union of Australia ('the CEPU') for an order nisi for writs of prohibition mandamus and certiorari directed to the Full Bench of the Industrial Relations Commission and Coal & Allied Operations Pty Limited. It is relevant to acknowledge the constraints imposed by the nature of the relief that is sought by the prosecutors; in particular, the proceedings remitted to this court are not by way of an appeal from the orders of the Full Bench of the Commission made on 29 January 1998. As described by Shaw and Gwynne, 'Certiorari and Error on the Face of the Record' in (1997) 71 ALJ 356 at 357: Certiorari is a prerogative power of superior courts to review decisions of inferior courts and tribunals. It differs from an appeal in that the reviewing court may not substitute its own decision for that of the lower tribunal. The order can be quashed, but, for redetermination, the case needs to be returned to the lower court which may then decide the case in light of the higher court's enunciation and clarification of the law. In Craig v State of South Australia (1995) 131 ALR 595, the High Court adopted the narrow view of what constitutes the record for the purpose of the ground of certiorari for error of law on the face of the record. For present purposes, it is useful to note the description by the Full Court (Brennan, Deane, Toohey, Gaudron and McHugh JJ) of the scope of certiorari at 599-600: Where available, certiorari is a process by which a superior court, in the exercise of original jurisdiction, supervises the acts of an inferior court or other tribunal. It is not an appellate procedure enabling either a general review of the order or decision of the inferior court or tribunal or a substitution of the order or decision which the superior court thinks should have been made. Where the writ runs, it merely enables the quashing of the impugned order or decision upon one or more of a number of distinct established grounds, most importantly, jurisdictional error, failure to observe some applicable requirement of procedural fairness, fraud and 'error of law on the face of the record.' Where the writ is sought on the ground of jurisdictional error, breach of procedural fairness or fraud, the superior court entertaining an application for certiorari can, subject to applicable procedural and evidentiary rules, take account of any relevant material placed before it. In contrast, where relief is sought on the ground of error of law on the face of the record, the superior court is restricted to the 'record' of the inferior court or tribunal and the writ will enable the quashing of the impugned order or decision only on the ground that it is affected by some error of law which is disclosed by that record. The above summary identification of the grounds upon which the prerogative writ of certiorari may properly issue glosses over a number of difficulties about the content of those grounds. Two of those difficulties are of direct relevance in the present case where it is argued that the alleged error on the part of the trial judge was either 'jurisdictional error' or 'error of law on the face of the record' for the purposes of certiorari. The first relates to what relevantly constitutes 'jurisdictional error'. The second is what constitutes 'the record' for the purpose of determining whether there is 'error of law on the face of the record'. Section 170MW is found in Pt VIB of the WR Act. That part deals with certified agreements. Division 8 of Pt VIB establishes a scheme enabling negotiations for the purpose of entering a certified agreement. Aspects of the scheme will be discussed in more detail shortly. For present purposes it is sufficient to describe the scheme in the following way. A prospective party to a certified agreement may give notice of an intention to negotiate a proposed certified agreement. In doing so the party can identify a period during which negotiations can occur: see s 170MI. During that bargaining period a prospective party to the certified agreement can take industrial action which is protected action: see s 170ML. The protection afforded by the WR Act is that no action lies under any law in respect of the protected industrial action subject to certain qualifications: see s 170MT. An employer cannot dismiss an employee for engaging in protected action though an employer may stand down or refuse to pay employees engaged in protected action: see s 170MU, and can lock out employees: see s 170ML. Before protected action is undertaken there must be negotiations: see s 170MP. A bargaining period ends if agreement is reached, one party indicates to the other they do not wish to reach agreement or the Commission terminates the bargaining period: see s 170MV. If a bargaining period is terminated by the Commission on a limited number of specified grounds the Commission can arbitrate issues in dispute: see s 170MX and s 170MY. The Commission can do so even though generally it might not be able to exercise arbitral power in relation to those issues. Of central importance to these proceedings is the power of the Commission to suspend or terminate a bargaining period conferred by s 170MW. The nature of the power conferred by that section will be considered in detail later in this judgment. Background facts Coal & Allied operates the Hunter Valley No. 1 mine which is a coal mine located in the Hunter Valley of New South Wales. Many employees of Coal & Allied were members of the CFMEU and the other two applicants in these proceedings, the AFMEPKIU and the CEPU. During 1996 the workforce took industrial action amounting to over 14 days of strike action at the mine. On 8 January 1997 CFMEU and AMWU members stopped work for 24 hours. On 9 January 1997 Coal & Allied made application to the Commission for orders under s 127 of the WR Act against the CFMEU, AMWU and CEPU and its members in relation to alleged industrial action. The orders sought were directions that industrial action stop or not occur. On 30 June 1997 a Full Bench of the Commission made orders that specified industrial action stop. The Full Bench had given their reasons for making the orders in a decision published on 20 June 1997. On 6 March 1997 the CFMEU gave notice to commence a bargaining period and the AMWU did likewise the following day. On 21 March 1997 members of both unions engaged in a 24 hour stoppage at the coal processing plant at the mine. By 19 May 1997 there had been more than 6 days of strike action at the mine and 7 days of strike action at the coal processing plant. On 10 June 1997 the workforce at the mine went on a strike which lasted for approximately six weeks. During that period there was picketing at the main entrance to the mine and on rail access to the coal loader. On 10 June 1997 Coal & Allied made application for the termination of the bargaining periods initiated by the CFMEU, AMWU and the CEPU in relation to the Hunter Valley No. 1 mine and the coal preparation plant. The ground on which the application was made was that the unions were not genuinely trying to reach an agreement with Coal & Allied. The application was heard by Justice Boulton on 10, 12 and 14 June 1997. On 17 June 1997 Justice Boulton decided not to terminate the bargaining periods, though his Honour gave directions about further negotiations between Coal & Allied and the three unions. These recommendations were accepted and negotiations continued through July and August 1997. However on 8 September 1997 members of the CFMEU, AMWU and CEPU commenced an indefinite strike after notice had been given under s 170MO that the members intended to take protected industrial action under the WR Act. The action that was undertaken included the maintenance of pickets at the main entrances to the mine and on the train line from the mine to the coal loader. On 15 September 1997 Justice Boulton commenced to hear an application by Coal & Allied requesting the Commission to exercise powers conferred by s 166A of the WR Act. That section enables the Commission to issue a certificate which removes a statutory prohibition imposed by s 166A on the bringing of proceedings in tort against an organization of employees, its officers or members. Late in the afternoon on 16 September 1997 Justice Boulton announced he had decided to issue a certificate under s 166A. His Honour also indicated he would give consideration to terminating or suspending the bargaining periods applying at the mine. He embarked upon a consideration of that question on 17, 18 and 19 September 1997. However in the afternoon of 19 September 1997 he announced that he thought it would be inappropriate for the Commission to terminate the bargaining periods at that stage. His Honour indicated he had decided not to proceed any further with the hearing of the matter. On 26 September 1997 Coal & Allied commenced proceedings in the Supreme Court of New South Wales seeking interlocutory injunctive relief against the CFMEU and the AMWU and officers and delegates of those two unions. On 14 October 1997 Justice Bruce gave judgment indicating he would issue interlocutory orders restraining conduct which physically impeded the ingress and egress of persons or vehicles or trains to and from the mine or from the showgrounds at Muswellbrook and Singleton. His Honour indicated that the order was not intended to preclude the maintenance of pickets at the mine which did not physically impede such ingress and egress. The reference to the showgrounds at Muswellbrook and Singleton was a reference to locations at which employees who were continuing to work for Coal & Allied parked their vehicles and caught buses to the mine. Before Justice Bruce gave judgment a Full Bench of the Commission had, on 30 September 1997, dismissed an appeal against the issuing of the certificate under s 166A by Justice Boulton. In addition, an order had been made by Senior Deputy President Harrison under s 127 of the WR Act directed to train crews employed by the Rail Freight Corporation requiring them not to engage in industrial action. On 30 October 1997 Justice Boulton relisted proceedings relating to the industrial action on the application of the three unions. On 31 October 1997 the three unions made application for the termination of the bargaining periods and the application was heard on 4 and 5 November 1997. On 7 November 1997 Justice Boulton published a decision indicating why he would make an order terminating the bargaining periods and made the order. His Honour concluded that industrial action being taken was threatening to endanger the welfare of part of the population: see s 170MW(3)(a), and the industrial action was threatening to cause significant damage to an important part of the Australian economy: see s 170MW(3)(b). On 10 November 1997 Coal & Allied filed an application seeking leave to appeal from Justice Boulton's orders. On 11 November 1997 the strike that had commenced on 8 September 1997 ended when the striking employees returned to work. Justice Giudice refused to stay the order of Justice Boulton pending the hearing and determination of the appeal. The appeal was heard on 26, 27 and 29 November and 5 December 1997 and a decision was given by the Full Bench on 29 January 1998. Nature of the power exercised by Justice Boulton on 7 November 1997 Before considering the way in which Justice Boulton and the members of the Full Bench exercised the powers conferred on them by the WR Act, it is convenient to consider more generally several of the relevant provisions of that Act. The power of the Commission to suspend or terminate a bargaining period is found in s 170MW of the WR Act. That section provides: 170MW(1) Subject to subsection (8), the Commission may, by order, suspend or terminate the bargaining period if, after giving the negotiating parties an opportunity to be heard, it is satisfied that any of the circumstances set out in subsections (2) to (7) exists or existed. 170MW(2) A circumstance for the purposes of subsection (1) is that a negotiating party that, before or during the bargaining period, has organised or taken, or is organising or taking, industrial action to support or advance claims in respect of the proposed agreement: (a) did not genuinely try to reach an agreement with the other negotiating parties before organising or taking the industrial action; or (b) is not genuinely trying to reach an agreement with the other negotiating parties; or (c) has failed to comply with any directions by the Commission that relate to the proposed agreement or to a matter that arose during the negotiations for the proposed agreement; or (d) has failed to comply with a recommendation of the Commission under section 111AA that relates to the proposed agreement or to a matter that arose during the negotiations for the proposed agreement. 170MW(3) A circumstance for the purposes of subsection (1) is that industrial action that is being taken to support or advance claims in respect of the proposed agreement is threatening: (a) to endanger the life, the personal safety or health, or the welfare, of the population or of part of it; or (b) to cause significant damage to the Australian economy or an important part of it. 170MW(4) A circumstance for the purposes of subsection (1) is that industrial action is being organised or taken by: (a) an organisation that is a negotiating party; or (b) a member of such an organisation who is employed by the employer; or (c) an officer or employee of such an organisation acting in that capacity; against an employer to support or advance claims in respect of employees: (d) whose employment will be subject to the agreement; and (e) who are neither members, nor eligible to become members, of the organisation. 170MW(5) A circumstance for the purposes of subsection (1) is that industrial action that is being organised or taken by an organisation that is a negotiating party: (a) relates, to a significant extent, to a demarcation dispute; or (b) contravenes an order of the Commission that relates, to a significant extent, to a demarcation dispute. 170MW(6) If the bargaining period relates to employees employed in a part of a single business, a circumstance for the purposes of subsection (1) is that the initiating party is not complying with an award or order, a direction of the Commission, or a certified agreement, in relation to another part of the single business. 170MW(7) A circumstance for the purposes of subsection (1) is that: (a) immediately before the commencement of this section, the wages and conditions of the kind of employees whose employment will be subject to the agreement were determined by a paid rates award, or would have been so determined if a certified agreement, an enterprise flexibility agreement (within the meaning of this Act as then in force) or a State employment agreement had not prevailed over the award; and (b) so far as the wages and conditions of the kind of employees whose employment will be subject to the agreement were, before the commencement of this section, customarily determined by an award or a State award, they were determined by a paid rates award; and (c) there is no reasonable prospect of the negotiating parties reaching an agreement under Division 2 or 3 during the bargaining period. 170MW(8) The Commission: (a) may not make an order under subsection (1), in a circumstance set out in subsection (2), (4), (5), (6) or (7), except on application by a negotiating party; but (b) may make an order under subsection (1), in a circumstance set out in subsection (3) (i) on its own initiative; or (ii) on application by a negotiating party or the Minister. 170MW(9) Anything done by a negotiating party or any other person in respect of the proposed agreement is not protected action if it is done at a time when the bargaining period is suspended. 170MW(10) An order under subsection (1) terminating the bargaining period may, if the Commission considers it to be in the public interest, contain a declaration that, during a specified period beginning at the time of the termination, a specified negotiating party or employee of the employer: (a) is not allowed to initiate a new bargaining period in relation to specified matters that are dealt with by the proposed agreement; or (b) may initiate such a bargaining period only on conditions specified in the declaration. (Emphasis added)

(i) The discretionary nature of the power Section 170MW was inserted into the WR Act by Act No 60 of 1996 and the amending legislation was assented to on 25 November 1996 and commenced, relevantly, on 31 December 1996. Section 33(2A) of the Acts Interpretation Act 1901 which commenced on 18 December 1987 provides: Where an Act assented to after the commencement of this subsection provides that a person, court or body may do a particular act or thing, and the word "may" is used, the act or thing may be done at the discretion of the person, court or body. Section 2(1) of that Act provides that the Act applies to all Acts except so far as the contrary intention appears. The statutory context in which the power created by s 170MW(1) is found does not suggest that the Commission is under a duty to exercise the power if it is satisfied that any of the circumstances set out in s 170MW(2)-(7) exists or existed: see Commissioner of State Revenue (Vic) v Royal Insurance Ltd (1994) 182 CLR 51 at 84-85. Indeed, there is nothing in the statutory context of s 170MW that suggests an intention that the Acts Interpretation Act 1901, and s 33(2A) in particular, not apply.

(ii) The satisfaction of the Commission The power to terminate the bargaining period conferred by s 170MW(1) is a discretionary power that can be exercised if a condition precedent is satisfied. The condition precedent is that the Commission is satisfied that one of the circumstances identified in the following subsections "exists or existed". Of significance is that the exercise of the power is not conditioned by the existence of one of the circumstances but rather the satisfaction of the Commission that it exists or has existed. The character of the condition precedent based on the satisfaction of the Commission has to be considered in the statutory context in which s 170MW appears. The nature of a power exercisable when an opinion is formed will depend on the statutory context in which the power arises. So too will the basis upon which the exercise of the power can be challenged. Generally the repositories of such a power must act in good faith and not arbitrarily or capriciously. They must not misdirect themselves in law or fail to take into account relevant considerations or take into account irrelevant considerations. The exercise of the power may be challenged on the footing that the decision is so unreasonable that no reasonable person could properly arrive at it. These matters were discussed by Gibbs J in Buck v Bavone (1976) 135 CLR 110 at 118-119 and referred to with approval by Brennan CJ, Toohey, McHugh and Gummow JJ in Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259 at 275-276. In order to understand what might be necessary for the condition precedent created by s 170MW to be met, the general structure and powers of the Commission should be considered. Section 37 of the WR Act contemplates the creation of industry panels to which members of the Commission are allocated. It also contemplates, subject to any specific provision in the WR Act or a direction of the President, that the powers of the Commission in relation to that industry shall, as far as practicable, be exercised by a member or members of the panel: see s 37(1). While the powers of the Commission in relation to an industry may be exercised by a member of the Commission who is not a member of the panel: see s 37(1A), the general scheme of the Act is that the powers of the Commission are, in relation to a particular industry, exercised by those members of the Commission familiar with that industry. This aspect of the scheme of the WR Act indicates that members of the Commission are to draw on their experience in much the same way as members of the Administrative Appeals Tribunal might call upon their experience in determining some issues before them: see Maric v Comcare (1993) 40 FCR 244. In Maric v Comcare an issue arose as to whether Comcare would be prejudiced by the grant of an extension of time in which an application for review could be lodged. O'Loughlin J said at 250: In the present case however, the facts were very different for Comcare had every reason to believe in April 1992 that the issue had long been put to rest, and the learned senior member who constituted the Tribunal was entitled to draw on his experience and conclude that a public authority, such as Comcare, would suffer prejudice. In Pereira v The Queen (1992) 66 ALJR 791 special leave was sought to appeal to the High Court against a decision of the New South Wales Court of Criminal Appeal which equated culpability arising from the importation of cocaine with that of heroin. Mason CJ referred to the approach of the Court of Criminal Appeal as "based upon judicial experience, if not judicial notice" (at 791); he saw no foundation for regarding it as erroneous. In my view, the learned Senior member was also entitled to place relevant reliance on his experience. (See also Tapper v The Queen (1992) 39 FCR 243.) The Tribunal is a specialist tribunal; it regularly deals with matters (such as these) involving public authorities and Government departments. The Tribunal and its members are entitled to make use of the knowledge that is thereby acquired and in appropriate circumstances that knowledge will entitle the Tribunal more readily to infer prejudice. A member of the Commission exercising the power conferred by s 170MW would ordinarily be dealing with a panel matter in a statutory context in which the Commission has been afforded a measure of flexibility concerning the manner in which factual issues are considered. Section 110 provides: 110(1) Where the Commission is dealing with an industrial dispute, it shall, in such manner as it considers appropriate, carefully and quickly inquire into and investigate the industrial dispute and all matters affecting the merits, and right settlement, of the industrial dispute. 110(2) In the hearing and determination of an industrial dispute or in any other proceedings before the Commission: (a) the procedure of the Commission is, subject to this Act and the Rules of the Commission, within the discretion of the Commission; (b) the Commission is not bound to act in a formal manner and is not bound by any rules of evidence, but may inform itself on any matter in such manner as it considers just; and (c) the Commission shall act according to equity, good conscience and the substantial merits of the case, without regard to technicalities and legal forms. 110(3) The Commission may determine the periods that are reasonably necessary for the fair and adequate presentation of the respective cases of the parties to an industrial dispute or other proceeding and require that the cases be presented within the respective periods. 110(4) The Commission may require evidence or argument to be presented in writing, and may decide the matters on which it will hear oral evidence or argument. (Emphasis added) It can be seen that s 110(2)(b) relieves the Commission of any obligation it might otherwise have to give effect to rules of evidence and authorizes it to inform itself in such manner as it considers just, though the relief is not without limits: see South Australian Commissioner for Prices and Consumer Affairs v Charles Moore (Aust) Ltd (1977) 139 CLR 449. A similar provision governs procedures in the Administrative Appeals Tribunal: see s 33(1)(c) of the Administrative Appeals Tribunal Act 1975. In Re Barbaro (1980) 3 ALD 1 Davies J said of s 33(1)(c) at 5: In informing itself on any matter in such manner as it thinks appropriate, the Tribunal endeavours to be fair to the parties. It endeavours not to put the parties to unnecessary expense and may admit into evidence evidentiary material of a logically probative nature notwithstanding that the material is not the best evidence of the matter which it intends to prove. … … As an administrative tribunal, it has the duty to review an administrative decision and to exercise the decision-making power. It is necessary that the nature of the procedures adopted at the hearing and the nature of the evidence which is received by the Tribunal be adapted to the function which it performs. A provision similar to s 110(2)(b) and s 33(1)(c), found in the Northern Territory Workmen's Compensation Ordinance 1949 (NT), was considered by the Full Court of the Federal Court in Dare v Dietrich (1979) 26 ALR 18. Deane J said at 33 that provisions of this type: … make it clear that, while the tribunal is, no doubt, under an obligation to act with judicial detachment and fairness, the proceedings before the tribunal are not governed by the ordinary principles relating to the determination of disputed questions of fact by a judicial tribunal. In reaching the requisite degree of satisfaction under s 170MW the Commission is engaged in a process which may well involve impressions and subjective value judgement: see Australian Heritage Commission v Mt Isa Mines Ltd (1997) 71 ALJR 441 at 444. This is particularly so in relation to the circumstance identified in s 170MW(3) which involves an evaluation of whether either or both of the matters referred to in paras (a) and (b) are being threatened.

Whether conduct or action is threatening to endanger something or cause significant damage to something will require consideration of the possible or likely effect of the conduct or action and consideration of whether that possible or likely effect is deleterious or harmful. That a process of evaluation arises in the context of s 170MW(3) is all the more apparent from the terms in which the subject matter that might be affected by the conduct or action is identified. It includes the welfare of the population and an important part of the Australian economy. Neither of these matters is susceptible of rigid or even clear definition. Nor ordinarily would the effect of conduct or action on them be capable of measurement in any quantitative sense. Necessarily the formation of the opinion that the circumstance identified in s 170MW(3) exists will involve evaluation and judgment. It involves a process of evaluation similar to that undertaken by the Commission when assessing whether there is an impending or probable industrial dispute. In making that assessment the Commission can do no more than form a view rather than determine, as a matter of fact, that a situation is likely to give rise to an industrial dispute: see Attorney-General for Queensland v Riordan (1997) 71 ALJR 1173 at 1186 per Gaudron and Gummow JJ; see also Victoria v The Commonwealth (1996) 187 CLR 416 at 497.

(iii) Need for circumstance to exist or to have existed The Commission's satisfaction referred to in s 170MW(1) concerns whether a circumstance "exists or existed". An issue arguedbefore the Full Bench and in these proceedings is whether the power conferred by s 170MW(1) is enlivened when the Commission is satisfied that any one of the identified circumstances in subsections (2) to (7) either has existed or presently exists. It can be seen in the highlighted parts of subs (2) to (7) in s 170MW set out earlier that certain of the identified circumstances are expressed in the present tense and some in the past sense. The construction of s 170MW(1), may be approached in one of two ways. The first approach is that the word "exists" is intended to refer to a circumstance that, in terms, is identified in s 170MW as an existing circumstance. On that approach the word "existed" is intended to refer to a circumstance which is identified, in terms, in s 170MW as a circumstance that formerly existed but no longer exists. On this approach the power conferred by s 170MW(1) may be exercised in relation to a circumstance identified in language signifying its present existence (by use of the present tense) only if the Commission is satisfied the circumstance exists at the time the power is to be exercised. The wording of s 170MW(2) tends to support this approach. The second approach to the construction of s 170MW(1) is that the power is enlivened if the Commission is satisfied that one of the identified circumstances either exists or existed irrespective of whether the circumstance is identified in language indicating it is existing or has existed. The two approaches may be illustrated this way. Section 170MW(3), which is a provision central to these proceedings, is in terms that identify the circumstance as presently existing. That is, the present tense is used in describing the circumstance. On the first approach, the power conferred by s 170MW(1) could not be exercised if the Commission was satisfied the circumstance had existed but was not existing at the time the power might be exercised. It must exist, to the satisfaction of the Commission, when the power is exercised. That is to be contrasted with one of the ways a circumstance is identified in s 170MW(2). Subsection (2) refers to a circumstance that may have occurred but is no longer occurring when it speaks of "a negotiating party … did not genuinely try to reach an agreement". It is couched in language of the past. That circumstance is one that could reasonably be described as having "existed". Thus the power conferred by s 170MW(1) could be exercised if the circumstance had existed, to the satisfaction of the Commission. Plainly s 170MW(2) also refers to an existing circumstance when it speaks of a negotiating party which "is not genuinely trying to reach an agreement …". Thus the power could also be exercised if the circumstance was existing, to the satisfaction of the Commission, when exercised. The second approach involves the Commission forming an opinion about whether a circumstance exists or existed even though the circumstance is itself identified in language using the present tense. It is an approach that might be thought to be consistent with the language of s 170MW(1). That is because even though the circumstance is identified in language signifying its present existence, what the Commission must do is to ascertain, to its satisfaction, whether the circumstance "exists or existed". Moreover the second approach satisfied the legislative purpose of s 170MW. That this is so can be illustrated by the circumstance identified in s 170MW(5). An organization which is a negotiating party might engage in industrial action that relates to a significant extent to a demarcation dispute. It may, additionally or in the alternative, be engaging in industrial action in contravention of an order of the Commission. The industrial action may be brief. It may, for example, be a strike of 24 hours duration. The first approach to the construction of the expression "exists or existed" would have the result that if the Commission came to consider whether an order should be made under s 170MW(1) but the industrial action had ceased then the circumstance identified in s 170MW(5) would not then exist. Thus the Commission could not be satisfied in a way that enlivened the power. The second approach would permit the Commission to consider whether the circumstance had existed and, if satisfied it had, then exercise the discretion conferred by s 170MW(1). Relevant considerations in the exercise of the discretion may well be the period that had elapsed since the industrial action had been taken as well as the circumstances in which it ceased. However the condition precedent to the exercise of that discretionary power would be satisfied. We have not found it necessary, having regard to the nature of these proceedings, to reach a concluded view as to whether the first or the second approach to the interpretation of s 170MW is the correct approach.

(iv) The relevance of picketing in deciding whether to terminate a bargaining period It was common ground in these proceedings that the reference to industrial action in s 170MW(3) (and by implication elsewhere in s 170MW) is a reference to industrial action as defined in s 4 and is not to be treated as a more limited reference to protected industrial action. Nonetheless there was an issue in these proceedings about whether picketing was industrial action. The applicants submitted it was. The definition of industrial action in s 4 provides: "industrial action" means (a) the performance of work in a manner different from that in which it is customarily performed, or the adoption of a practice in relation to work, the result of which is a restriction or limitation on, or a delay in, the performance of the work, where: (i) the terms and conditions of the work are prescribed, wholly or partly, by an award or an order of the Commission, by a certified agreement or AWA, by an award, determination or order made by another tribunal under a law of the Commonwealth or otherwise by or under a law of the Commonwealth; or (ii) the work is performed, or the practice is adopted, in connection with an industrial dispute; (b) a ban, limitation or restriction on the performance of work, or on acceptance of or offering for work, in accordance with the terms and conditions prescribed by an award or an order of the Commission, by a certified agreement or AWA, by an award, determination or order made by another tribunal under a law of the Commonwealth or otherwise by or under a law of the Commonwealth; (c) a ban, limitation or restriction on the performance of work, or on acceptance of or offering for work, that is adopted in connection with an industrial dispute; or (d) a failure or refusal by persons to attend for work or a failure or refusal to perform any work at all by persons who attend for work, if: (i) the persons are members of an organisation and the failure or refusal is in accordance with a decision made, or direction given, by an organisation, the committee of management of the organisation, or an officer or a group of members of the organisation acting in that capacity; or (ii) the failure or refusal is in connection with an industrial dispute; or (iii) the persons are employed by the Commonwealth or a constitutional corporation; or (iv) the persons are employed in a Territory; but does not include: (e) action by employees that is authorised or agreed to by the employer of the employees; or (f) action by an employer that is authorised or agreed to by or on behalf of employees of the employer; or (g) action by an employee if: (i) the action was based on a reasonable concern by the employee about an imminent risk to his or her health or safety; and (iii) the employee did not unreasonably fail to comply with a direction of his or her employer to perform other available work, whether at the same or another workplace, that was safe and appropriate for the employee to perform. (Emphasis added)

The only basis on which picketing might be comprehended by the definition of industrial action is if it is conduct of the type identified in para (c) of the definition. That is, if it is a restriction on the performance of work or on the acceptance of or offering for work. The word "picketing" may simply describe a lawful assembly outside a workplace (or elsewhere) protesting about and drawing attention to conditions of employment in the workplace. The word "picketing" may also describe an assembly which engages in protest of this type but also prevents or impedes access into and out of the workplace (or elsewhere). Even if used to describe the latter situation it is unlikely that picketing is conduct comprehended by the expression "a … restriction on the performance of work" as it appears in para (c). Having regard to the context in which that expression appears, it is more likely to relate to restrictions imposed by an employee or a group of employees on the work they do so as to limit the scope of that work or the time or the circumstances in which it is done. While the expression "a … restriction … on acceptance of or offering for work" in para (c) might comprehend picketing of the latter type which prevented employees who were continuing to work from attending the workplace it is unlikely to have such a wide meaning if the other elements in para (c) relate to circumstances of the type just discussed. It is likely that para (c) in its entirety is directed to the conduct of employees who engage in conduct limiting the work they do or the circumstances in which they offer to do it. Reference was made to the judgment of Drummond J in FH Transport Pty Ltd v Transport Workers Union of Australia (1997) 145 ALR 366 that might suggest that picketing is industrial action as defined. However that question was not directly addressed in his Honour's reasons. The scope of the definition of "industrial action" appears not to have been canvassed in argument in that matter which generally related to the operation of the protective provisions of the WR Act on picketing. Other authorities referred to by counsel for the applicants in these proceedings including In re Building Construction Employees and Builders Labourers Federation of New South Wales v Jennings Industries Ltd (1982) AR 677 at 688 and the judgment of Derrington J in Castlemaine Perkins Pty Ltd v The Australian Liquor and Hospitality and Miscellaneous Workers Union of Australia, Queensland Branch, Union of Employees (unreported, 2 December 1997, Supreme Court of Queensland) either did not depend on a definition of industrial action or related to a definition that was in materially different terms to that appearing in s 4 of the WR Act. However for reasons which will emerge shortly it is unnecessary to express a concluded view about the scope of the definition of industrial action as it might apply to picketing. That is not to say, however, that if picketing of either of the types just discussed is undertaken and is reasonably incidental to industrial action to support or advance claims in respect of a proposed certified agreement, the picketing is irrelevant when considering whether the industrial action is causing a particular result. That issue is discussed shortly in the context of considering the decisions of both Justice Boulton and the Full Bench.

The manner in which Justice Boulton exercised the power conferred by s 170MW The decision of Justice Boulton to terminate the bargaining period and the orders terminating it were made on 7 November 1997 on the application of CFMEU, AMWU and CEPU. There had been a hearing on 4 and 5 November 1997 and both the applicant unions and Coal & Allied asked that the application to terminate be decided as soon as possible. In these proceedings counsel for the applicants have, in their written submissions, summarized the decisions of Justice Boulton and the Full Bench. That summary was commented on in the written submissions of counsel for Coal & Allied. The summary provides a convenient means of setting out the reasons for decision of Justice Boulton (and later the Full Bench) and what follows (and follows later) is an adaptation of that summary. The grounds on which the application to terminate the bargaining period were made were summarized by Justice Boulton in his reasons for decision: The grounds relied upon by the unions in the applications relate to industrial action and associated developments which have taken place at the Mine since June this year. These include a six week strike by workers which took place in June and July 1997, strike action which commenced on 9 September 1997 and is continuing, retaliatory action by the Company, and picketing of access roads and rail lines leading to the Mine. More particularly, the grounds relied upon for the termination of the bargaining periods are: (a) that there exists or existed circumstances under s.170MW(3)(a) in that the industrial action taken by the CFMEU, AMWU and CEPU, and the retaliatory action of the Company, and the further industrial action threatened to be taken by the trade union movement in the Newcastle and Hunter regions to support or advance claims in respect of the proposed agreement, had threatened or is further threatening to endanger the welfare of part of the population, being in particular the population of the Newcastle and Hunter regions; (b) that there exists or existed circumstances under s.170MW(3)(b) in that the industrial action taken by the CFMEU, AMWU and CEPU, and the retaliatory action of the Company, and the further industrial action threatened to be taken by the trade union movement in the Newcastle and Hunter regions to support or advance claims in respect of the proposed agreement, is causing and is threatening to cause significant damage to the Australian economy, or part of the Australian economy, being that part which is comprised of the Newcastle and Hunter regions; (c) that circumstances exist or existed generally under s.170MW(3) which warrant the Commission suspending or terminating the bargaining period. Justice Boulton then observed that the circumstances in which the applications were being made were that there had been strike action and picketing by workers at the mine since 9 September 1997. Justice Boulton set out the background to the applications and referred to matters adverted to in this judgment as the background facts concerning the history of proceedings in the Commission. His Honour referred to the Commission of its own motion considering on 17-19 September 1997 whether the bargaining periods should be terminated under s 170MW(3). His Honour also referred to a strike at the mine that had lasted for approximately six weeks commencing on 10 June 1997. Justice Boulton indicated the background of disputation at the mine was relevant as it explained the general circumstances and context in which the applications were made. Justice Boulton noted that the parties had relied on submissions and evidence presented in earlier proceedings before the Commission constituted by him, and in particular C. Nos. 35882, 23521 and 37394 of 1997, and evidence and submissions before another member of the Commission (Commissioner Harrison) in C. Nos. 23689, 23690, 23691, 23693, 23694 and 23698 of 1997 as well as evidence which was led in the Supreme Court proceedings before Justice Bruce. Justice Boulton stated that the applications to terminate the bargaining periods needed to be determined according to whether the requirements for their termination under s. 170MW(3) had been made out. Justice Boulton noted the Commission must be satisfied that, relevantly, either of the circumstances identified in s. 170MW(3) must exist or have existed. He also noted that if the Commission was so satisfied then a discretion arose under s 170MW(1) to make an order terminating the bargaining period. Two competing interpretations of s 170MW(3) had been put to Justice Boulton. The first interpretation ("the narrow view") was propounded by the Commonwealth and Coal & Allied. The narrow view was that the Commission in applying the terms of the section was only entitled to have regard to protected industrial action being taken by a negotiating party as the relevant industrial action which was threatening the endangerment or damage referred to in paragraphs (a)-(b) of s 170MW(3). It was argued that it was not sufficient for the protected industrial action indirectly to bring about the effects identified in either of those sections. Thus sympathy action or an escalation of the action involving other workers was not relevant to the Commission's satisfaction of the existence of the situations identified in the section. The CFMEU, AMWU and CEPU as well as the State of New South Wales, which had intervened in the proceedings, argued that the reference to industrial action in s. 170MW(3)(a) and (b) was not qualified or restricted and that the Commission in forming the requisite satisfaction was required to have regard both to the direct and indirect consequences of the industrial action that was taking place ("the broad view"). Justice Boulton preferred the broad view. However he observed that even if the industrial action referred to in s 170MW(3) was limited to protected industrial action, sympathy and associated action might be relevant in considering whether a circumstance identified in s. 170MW(3) had arisen. Despite his preference for the broad view, Justice Boulton indicated it was unnecessary to make any final decision favouring either the narrow or broad view because there was evidence and material before the Commission that satisfied him that the circumstances as referred to in the subsection exist or existed. Justice Boulton stated that his satisfaction as to the existence of circumstances identified in s 170MW(3) came about having regard to all of the material and evidence presented to him. He then identified some particular evidence and material that had been considered. These included: (a) the material, evidence and submissions put before the Commission in the proceedings and in other proceedings regarding industrial action and picketing at the mine and the consequences of that action and also regarding the negotiations for an enterprise agreement at the mine; (b) the evidence given by witnesses called by Coal & Allied in the proceedings before Justice Bruce and in particular the affidavits sworn by Mr Davies, the general manager (operations) of the mine, Mr Ian McPhee, Coal & Allied's executive general manager for marketing and Mr Tony Moore, manager, supply for Rio Tinto Coal (NSW) Pty Ltd. The affidavits dealt with the difficulties experienced by Coal & Allied in the operations of the mine and the supply of coal to customers as a result of the industrial action and picketing. (c) the personal intervention of the Premier of New South Wales in the dispute and the statements made by the Premier and the Attorney-General for New South Wales regarding the impact of the industrial action and the disputation; (d) the debate in the Legislative Assembly of New South Wales on 21 October 1997 in which a motion was passed concerning the dispute. Two sections of the motion were supported by both Government and Opposition parties and one of them was in terms of a warning of the "devastating impact upon the New South Wales and national economy of a further prolonged or escalated dispute"; (e) the concern expressed by local shire and city councils about the impact of the dispute on local communities in the Hunter Valley region. Justice Boulton then turned to consider the circumstances identified in s 170MW(3) and whether an identified circumstance had been made out. Justice Boulton said: On the basis of the material before me, I am satisfied that the strike action being taken at the Mine is threatening to endanger the welfare of part of the population, namely the people of the Hunter Valley region. This is plainly an expression of satisfaction that the identified circumstance presently exists. Justice Boulton then referred to factual matters that supported his conclusion. They were that the strike action was taking place at one of the largest coal mines in the region and involved almost 400 workers, that the action had been continuing for over 8 weeks, and that there had been previous action in June and July 1997 over a period of some 6 weeks. Justice Boulton said that there were reasonable grounds upon which it could be assumed that the action might continue for some considerably longer period. Justice Boulton referred to the evidence about the impact of the action on workers and others providing services to the mine and about the divisions and social tensions it was causing within local communities and the effect on local businesses. He noted that the newsletter from the general manager operations at the mine, which was forwarded on 19 June 1997 to all employees and their families, stated in respect to the earlier 6 week stoppage that the strike was hurting everyone, namely, the employees, their families, Coal & Allied and the Hunter Valley, and that it was currently costing one million dollars a day in lost income to the mine and that that money would have gone back into the pockets of employees, suppliers and contractors who lived locally. Having regard to the length of the dispute, the number of workers and families involved, the concerns expressed about its effect, the potential for the continuation of the disputation, Justice Boulton found that "it would be difficult to conclude that the strike action which has taken place at the mine and which may continue is not threatening the welfare of the people of the Hunter Valley". His Honour then said: For the above reasons, and regardless of whether a broad or narrow construction of s. 170MW(3) is adopted, I am satisfied that a circumstance for the termination of the bargaining period exists or existed under s. 170MW(3)(a). It is to be noted that his Honour refers to the circumstance as one that exists or existed and, in so doing, was simply repeating the language of s 170MW(1). Justice Boulton went on to indicate that he was also satisfied that the industrial action at the Mine was threatening to cause significant damage to an important part of the Australian economy. It is relatively clear that this is a reference to the regional economy of the Hunter Valley. His reasons for reaching this conclusion were: The strike action at the Mine has lasted for more than fourteen weeks. On the material presented and having regard to the circumstances of this particular dispute and the coal industry, it is unlikely that the disputation will be brought to an end quickly or that the matters in issue between the parties will be resolved by further negotiation. As stated in earlier proceedings, there is every sign that both the Company and the workers and unions involved have become resigned to a war of attrition extending over a considerable period of time before an outcome is achieved. This would mean a continuation of strike action by almost 400 workers at one of the largest coal mines in the Hunter Valley for an indefinite period. Given this potential, I am satisfied that the strike action being taken is threatening to cause significant damage to the economy of the Hunter Valley region. Justice Boulton said that the evidence for this conclusion included the evidence he had earlier referred to and the assessment he had made based on his own knowledge of the coal industry of the potential for the disputation and the strike action to continue. Justice Boulton referred to evidence of Dr Paradise who was the research director of the Hunter Valley Research Foundation regarding the economic interrelationship between various activities in the Hunter region. That evidence related to the potential for a strike in one industry to have multiplier effects on other sectors. Justice Boulton said that where there was room for argument about the precise impact of the industrial action, "a prolonged stoppage at such a mine may well have the potential through its direct and associated effects to cause significant damage to the regional economy." Justice Boulton then said: However if the broader view of s 170MW(3) is taken, and the potential for the escalation of the dispute at the Hunter Valley No. 1 Mine to include other coal mines and workers in other industries is considered, there is a basis for concluding that the industrial action at the Mine is threatening to cause significant damage to the Australian economy, to the New South Wales economy, to the economy of the Hunter Valley region or to the coal industry. Justice Boulton then noted the potential for escalation of the dispute and observed that the dispute at the mine had already led to one stoppage at other coal mines in the region and had the potential to spread to other areas including railways and ports. He referred to the fact that the Premier of New South Wales had been involved personally and to the debate that had occurred in the New South Wales Parliament. He also referred to the evidence given in the Supreme Court proceedings about damage caused by the strike to the trading reputation of Coal & Allied and that the damage may extend to other Australian exporters of coal especially if there is an escalation of the dispute in the coal industry. Justice Boulton indicated that whatever might be the cause of the strike it was evident the dispute had assumed a significance beyond that of a strike affecting a single workplace. This development was another reason for concluding that there was a very real potential for the dispute at the mine to escalate to involve other workers in the coal industry and indeed workers in other industries. He concluded: In all these circumstances I am satisfied that the industrial action being taken at the mine is threatening, through its potential for escalation, to cause significant damage to the Australian economy or an important part of it. Justice Boulton described the dispute as "a battle between titans, in which the stakes are considered to be high and in which there is a determination on both sides to be seen to win". He said the hard fought dispute had already caused significant loss to the company, the workers and the local community and it had a "potential to cause wider economic and social damage". Justice Boulton indicated that he was satisfied that whether a broad construction of s. 170MW(3) was adopted or not, one or more of the circumstances existing under the subsection allowed him to exercise his discretion to suspend or terminate the relevant bargaining periods. He determined that it was appropriate to terminate the bargaining periods applying at the mine. He made declarations and orders giving effect to these conclusions. The nature of an appeal to a Full Bench of the Commission It is to be recalled that the orders of Justice Boulton were quashed by the Full Bench exercising the appellate jurisdiction of the Commission arising under s 45 of the WR Act. It is desirable to consider the nature of the appellate jurisdiction before dealing with the way the Full Bench approached the matter in the present case. Section 45 provides: 45(1) Subject to this Act, an appeal lies to a Full Bench, with the leave of the Full Bench, against: (a) a decision of a member of the Commission by way of a finding in relation to an industrial dispute or alleged industrial dispute; (b) an award or order made by a member of the Commission, other than an award or order made by consent of the parties to an industrial dispute; (c) a decision of a member of the Commission not to make an award or order; (d) a decision of a member of the Commission under paragraph 111(1)(g); (e) a decision of a member of the Commission refusing to certify an agreement under Division 4 of Part VIB; (ea) an opinion formed by a member of the Commission under section 127A or a decision by a member of the Commission not to form such an opinion; (eb) an order made by a member of the Commission under section 127B or a decision by a member of the Commission not to make such an order; (ec) (Repealed) (ed) a decision of the Commission to vary, or not to vary, an award that has been referred to the Commission under section 50A of the Sex Discrimination Act 1984; (f) a decision (other than in relation to a prescribed matter) in a proceeding before a designated Presidential Member acting in that capacity; and (g) a decision of a member of the Commission that the member has jurisdiction, or a refusal or failure of a member of the Commission to exercise jurisdiction, in a matter arising under this Act. 45(2) A Full Bench shall grant leave to appeal under subsection (1) if, in its opinion, the matter is of such importance that, in the public interest, leave should be granted. 45(3) An appeal under subsection (1) may be instituted: (a) in the case of an appeal under paragraph (1)(b) that is not against an order under Part VIA - by an organisation or person bound by the award or order; (aa) in the case of an appeal under paragraph (1)(b) against an order under Part VIA - by a person entitled under section 170JF to institute the appeal; (b) in the case of an appeal under paragraph (1)(e) - by a person who made the agreement; (bb) in the case of an appeal under paragraph (1)(ed) - by a party to the review of the award under section 111A; (c) in the case of an appeal under paragraph (1)(f) - by a party to the proceeding; and (d) in any other case - by an organisation or person aggrieved by the decision or act concerned. 45(4) Where an appeal has been instituted under this section, a Full Bench or Presidential Member may, on such terms and conditions as the full Bench or Presidential Member considers appropriate, order that the operation of the whole or a part of the decision or act concerned be stayed pending the determination of the appeal or until further order of the Full Bench or Presidential Member. 45(5) A Full Bench may direct that 2 or more appeals be heard together, but an organisation or person who has a right to be heard in relation to one of the appeals may be heard in relation to a matter raised in another of the appeals only with the leave of the Full Bench. 45(6) For the purposes of an appeal under this section, a Full Bench: (a) may admit further evidence; and (b) may direct a member of the Commission to provide a report in relation to a specified matter. 45(7) On the hearing of the appeal, the Full Bench may do one or more of the following: (a) confirm, quash or vary the decision or act concerned; (b) make an award, order or decision dealing with the subject-matter of the decision or act concerned; (c) direct the member of the Commission whose decision or act is under appeal, or another member of the Commission, to take further action to deal with the subject-matter of the decision or act in accordance with the directions of the Full Bench; (d) in the case of an appeal under paragraph (1)(d) - take any action (including making an award or order) that could have been taken if the decision under paragraph 111(1)(g) had not been made. 45(8) Where, under paragraph (6)(b), a Full Bench directs a member of the Commission to provide a report, the member shall, after making such investigation (if any) as is necessary, provide the report to the Full Bench. 45(9) Each provision of this Act relating to the hearing or determination of an industrial dispute extends to the hearing or determination of an appeal under this section. A Full Bench of the Commission consists of at least three members including at least two Presidential members: see s 30(2). Presidential members may be legally qualified but need not be: see s 10, though Presidential members have the status, rank and precedence of a judge of this Court: s 9(2). It can be seen from s 45(1) that an appeal lies to a Full Bench only with the leave of the Full Bench. Section 45(1) confers a power on the Full Bench to grant leave and s 45(2) requires a Full Bench to grant leave if it forms the opinion that the matter is of such importance that in the public interest leave should be granted. The formation of that opinion dictates that leave be granted. Section 45(2) does not prescribe the test for the grant of leave. It requires the Full Bench to grant leave, if the Full Bench forms the requisite opinion. The conventional considerations for the granting of leave, including whether, in all the circumstances, the decision is attended with sufficient doubt to warrant its being reconsidered by the Full Bench, or whether substantial injustice would result if leave were refused, supposing the decision to be wrong, are not replaced by a different test: rather, s 45(2) provides a further, and obligatory, basis for the grant of leave. The range of matters that may be the subject of an appeal is not narrow and covers disparate powers or functions exercised or undertaken by a member of the Commission sitting alone. The powers of the Commission are ordinarily exercisable by a single member: see s 31, though some may only be exercised by a Presidential member. In ascertaining the nature of the appellate jurisdiction of the Commission arising under s 45 it is instructive to consider the legislative history of that provision. It is sufficient to commence that consideration with the creation in 1956 of the predecessor of the Commission, the Commonwealth Conciliation and Arbitration Commission ("C&A Commission") and the nature of the appellate jurisdiction conferred on it. Jurisdiction was conferred on the C&A Commission to hear and determine two classes of appeals. The first was an appeal under what became s 35 (it was initially s 16U) of the Conciliation and Arbitration Act 1904 (C&A Act) and the second under s 88F of that Act. An appeal under s 35 was heard and determined by not less than three members of the C&A Commission two of whom had to be Presidential members. The matters that might be subject to such an appeal were identified in s 35(2) in the following way: (a) An award made by the Commission constituted by a Commissioner; (b) A decision of the Commission, constituted by a Commissioner, certifying, or refusing to certify, a memorandum under section thirty-one of this Act; (c) A decision of the Commission, constituted by a Commissioner, under paragraph (d) of section forty-one of this Act refraining or refusing to refrain from further hearing or from determining an industrial dispute on the ground that the industrial dispute has been dealt with, is being dealt with or is proper to be dealt with by a State Industrial Authority. Section 35(3) provided that an appeal did not lie unless, in the opinion of the Commission, the matter was of such importance that, in the public interest, an appeal should lie. This provision is to be contrasted with s 45(2) of the WR Act. It can be seen that decisions amenable to appeal lay from members of the Commission sitting alone, and were limited to the decisions of the kind specified. Those decisions concern powers which involve the exercise of a discretion. However, by 1983, the decisions amenable to appeal had been expanded, and included a decision of a member of the C&A Commission by way of finding as to the existence of or the parties to an industrial dispute. This amendment was made by the Conciliation and Arbitration Act 1972 to overcome the decision of a Full Bench in Federated Ironworkers Association v Alcoa of Australia Pty Ltd (1966) 115 CAR 920 in which the Full Bench concluded it had no power to entertain an appeal concerning the scope of a finding of the existence of an industrial dispute. The relevance of this amendment was that it could ground an appeal against an act of a member of the Commission which did not involve the exercise of a discretionary power. Section 24(1) of the C&A Act, imposing a duty on the Commission to make a finding as to its jurisdiction both as to parties and as to subject matter, createda procedural bar to the exercise of powers capable of affecting substantive rights and liabilities: see Re Australian Bank Employees Union; Ex parte Citicorp Australia Ltd (1989) 167 CLR 513 at 517. The role of a Full Bench exercising the appellate jurisdiction under s 35 was considered by a Full Bench in The Australian Workers' Union v Poon Bros (WA) Pty Ltd (1983) 289 CAR 269. The Full Bench reviewed earlier Full Bench decisions concerning the appellate function under s 35. The approach that had been consistently adopted was that if leave had been given, the Full Bench did not exercise again the powers of the Commission without regard to the manner in which the member of the Commission sitting alone had exercised those powers. After undertaking that review and considering the decision of the High Court in Warren v Coombes (1979) 142 CLR 531, the Full Bench said at 277-278: There are of course, appeals when questions of jurisdiction are raised and must be determined, but in the great majority of cases, the decisions brought before a Full Bench on appeal have come up from a single member who has been required to exercise a discretion in reaching his conclusion. In our opinion, the approach to those decisions should accord with the principles stated and applied by Full Benches of the Commission for many years. These basically follow the principles published in House v King which have been affirmed by the High Court on a number of occasions since 1936 (see for example, Attorney-General (NSW) v Grant (1975-76) 135 CLR 587 at 611; Aickin J in Gronow v Gronow (1979) 144 CLR 513 at 534. Thus the Full Bench was repeating the approach that had consistently been adopted by the Commission that an appeal under s 35, in so far as it constituted an appeal against the exercise of a discretionary power, was an appeal in which the appellant had to demonstrate that the single member of the Commission had made an error in exercising the discretion. Such an error would occur, to use the language in the well known passage in House v King (1936) 55 CLR 499 at 504: If the judge acts upon a wrong principle, if he allows extraneous or irrelevant matters to guide or affect him, if he mistakes the facts, if he does not take into account some material consideration … In addition to the appellate jurisdiction conferred on a Full Bench under s 35 there was an appellate jurisdiction conferred on a single member of the C&A Commission under s 88F of the C&A Act. That concerned an appeal from an act or decision of the Industrial Registrar which included a Deputy Industrial Registrar. Leave was required to appeal. The Industrial Registrar was a statutory office holder but was not a member of the Commission. Industrial Registrars exercised a range of administrative powers in relation to registered organizations including their registration and alterations to their eligibility or industry rules. The appellate jurisdiction conferred by s 88F was exercisable by a Presidential member or the President. Section 88F was inserted into the C&A Act by an amendment made by the Conciliation and Arbitration Act 1958. The terms of s 88F will be referred to in more detail shortly. These two appellate jurisdictions, one arising under s 35 and the other under s 88F, continued until the abolition of the C&A Commission by the repeal of the C&A Act and the creation of the Commission by the enactment of the Industrial Relations Act 1988 (which in 1996 was renamed the Workplace Relations Act). At the time of its repeal the C&A Act provided that the classes of matters against which an appeal could be brought under s 35 were those that had appeared in s 35 when enacted in 1956 (originally as s 16U), a decision concerning the finding of the existence of an industrial dispute and an order by a Presidential member, or the refusal to make an order, under s 142A (being an order of the character of a demarcation order). The nature of the appeal under s 88F remained essentially the same as it had been since 1958 though at the time of the repeal of the C&A Act the appeal could also be heard by a Full Bench. The Industrial Relations Act 1988 continued a scheme for appeals from the Industrial Registrar to the Commission (a Presidential member or a Full Bench): see s 81, and a scheme for appeals from single members of the Commission to a Full Bench: see s 45. However under that Act the functions and powers of an Industrial Registrar relating to the registration of organizations of employees or employers and alterations to their eligibility rules were vested in a member of the Commission, a designated Presidential Member, and were not exercisable by an Industrial Registrar. Section 45 provided for appeals from a decision of a designated Presidential Member. This had the effect of conferring on a Full Bench an appellate jurisdiction of the same character that had arisen under s 88F but in the same statutory provision as the appellate jurisdiction that had existed under s 35. The significance of this change emerged when the High Court gave judgment in Re Coldham; Ex parte Brideson (1990) 170 CLR 267 ("Brideson (No 2)"). Judgment was given after the enactment of the Industrial Relations Act 1988 but it related to the provisions of the C&A Act and, in particular, s 88F. The judgment of the Court concerned a matter which had been considered by the Court in another context a year earlier: see Re Coldham; Ex parte Brideson (1989) 166 CLR 338 ("Brideson (No 1)"). In Brideson (No 2) the High Court considered the nature of the jurisdiction of theC&A Commission under ss 88F of the C&A Act. That section provided: (1) The Commission may grant leave to appeal to the Commission from an act or decision of the Registrar in relation to a matter and may hear and determine an appeal in respect of which leave is so granted. (2) Where leave to appeal has been granted under this section, the Commission may, on such terms and conditions as it thinks fit, make an order that the operation of the act or decision of the Registrar be stayed pending the determination of the appeal or until further order of the Commission. (3) The Commission may take further evidence for the purposes of an appeal under this section. (4) Upon the determination of an appeal under this section by the Commission, the Commission shall make such order as it thinks fit and may confirm, quash or vary a decision of the Registrar appealed from. (5) The powers of the Commission under this section in respect of an appeal to the Commission are exercisable by the Commission constituted by the President or by a presidential member of the Commission assigned by the President for the purpose of the appeal or, in a case in which the President so directs, by a Full Bench. (Emphasis added) Brideson (No 1) was decided against the following background. Three associations of employees made application for registration as organizations of employees under s 132 of the C&A Act. Objections were made to each application. The Industrial Registrar registered each association. Objectors to the application of two of the associations for registration appealed against the Industrial Registrar's decision. That appeal was heard by a Full Bench which took the view that the Industrial Registrar's decision to register one of the associations, the Teacher's Association of Australia ("TAA"), should be quashed. It did so on the basis that the registration of TAA might result in competition for membership between registered organizations. The C&A Act and regulations identified the bases upon which registration might be refused and the grounds on which an objection to registration might be maintained. The ground relied upon by the Full Bench for refusing to register TAA was not an identified ground for refusing registration nor a ground of objection identified in the C&A Act or regulations. The High Court concluded in Brideson (No 1) at 348: It follows that the Commission erred in holding that registration could be refused by reference to considerations not expressly directed by the Act and Regulations. And, in so far as the Commission quashed the decision of the Registrar by reference to such considerations it did so by reference to impermissible considerations. The High Court issued a writ of mandamus compelling the Full Bench to deal with the application for registration of TAA. The appeal from the original decision of the Industrial Registrar, in so far as it related to the application by TAA for registration, was heard again by the Full Bench. That hearing took place in circumstances where the other two associations had secured registration and thus were registered organizations of employees. Section 142 of the C&A Act provided that an Industrial Registrar should ordinarily refuse to register any association if there was already registered an organization of employees to which the members of the applicant association might conveniently belong. A critical question then became whether the Full Bench should deal with the application before it, namely TAA's application for registration, having regard to the circumstances as they existed before the Industrial Registrar or the circumstances as they existed before the Full Bench. In the former situation there was no registered organization to which the relevant employees could conveniently belong though in the latter situation there was. It was in these circumstances that the High Court had to consider in Brideson (No 2) the nature of the appellate jurisdiction conferred on a Full Bench by s 88F. In the joint judgment of Deane, Gaudron and McHugh JJ their Honours discussed at 100 observations of McHugh JA in Strange-Muir v Corrective Services Commission [1986] 5 NSWLR 234. The observations of McHugh JA will be referred to in more detail shortly. However the following was then said in the joint judgment in Brideson (No 2) about the nature of the appellate jurisdiction arising under s 88F (at 273-275): Nevertheless, whether the right of appeal against an administrative decision is given to a court or to an administrative body, the nature of the appeal must ultimately depend on the terms of the statute conferring the right: Builders Licensing Board v Sperway Constructions (Syd) Pty Ltd (1976) 135 CLR 616 at 621-622. In the present case, the enactment of s 88F(3) -"take further evidence", the terms of s. 88F(4) -"make such order as it thinks fit", and the nature of many of the issues which came before the Commission on appeal from the Registrar point irresistibly to the conclusion that the Commission was required to decide the case on the facts and law which existed at the date of its decision. In appeals against decisions to register associations as organizations for the purposes of the Act, one of the issues which the Commission often had to determine under s. 88F was whether the association had complied with the prescribed conditions. Another issue which often had to be determined was whether, by reason of the provisions of s. 142 of the Act, registration should be refused. It seems most unlikely that the legislature intended that, on an appeal under s. 88F, the Commission had to register or confirm the registration of an association notwithstanding that, at the date of the appeal, the association no longer complied with the prescribed conditions. Furthermore, as this Court pointed out when the present case was previously before it: "The history of industrial regulation in this country has shown the desirability of ensuring that industrial representation is structured in the interests of employees and the industry in which they are engaged, both for the purpose of avoiding demarcation disputes and for the purpose of ensuring effective industrial representation." The effective administration of the Act made it a matter of importance that an association should not be registered if its members might conveniently belong to a registered organizaiton unless in all the circumstances it was undesirable to refuse registration. It would seem most unlikely, therefore, that the legislature intended that the Commission should register or confirm the registration of an association if, at the date of the appeal, there was an organization to which the members of the association might then conveniently belong and the Commission did not think it was undesirable to refuse registration to the association. In our opinion, upon the correct construction of s. 88F, the Commission was bound to make its own decision on the evidence before it, including evidence of events which had occurred since the Registrar's decision. As Higgins J. said in Federated Carters and Drivers' Industrial Union of Australia v Motor Transport and Chauffeurs' Association of Australia (1912) 6 C.A.R. 122, at p. 123: "the appellant is entitled to have … a re-hearing, a 'review' of the decision … He is entitled to such judgment as I can bring to bear upon the question, independently of the Registrar, although, of course, I should attach a good deal of weight to the Registrar's view." This statement was made when the predecessor of s. 88F contained the word "review". Nevertheless, it is equally applicable to s. 88F. Consequently, the statement of the Full Bench in Re Federated Miscellaneous Workers Union of Australia (1974) 157 C.A.R. 623, at p. 631 that "the principles relating to the function of a tribunal sitting on appeal from the exercise of a discretion should be applied" in an appeal under s. 88F cannot be accepted as a correct description of the Commission's functions under that section. That is not to say, however, that those principles could not be brought to bear on the question whether leave to appeal should be granted. In determining whether leave to appeal should be granted under s. 88F(1), it would have been appropriate for the Commission to refuse leave unless it thought that there was an arguable case that the Registrar had acted upon a wrong principles, given weight to irrelevant matters, failed to give sufficient weight to relevant matters or made a mistake as to the facts or that the decision was plainly unreasonable or unjust. But once leave was granted, the Commission was bound to make its own decision on the evidence before it, including any further evidence admitted pursuant to s. 88F(3). It follows from what has been said above that the Commission had jurisdiction to permit the objections under s. 142 to be raised. Consequently, the order nisi to review its decisions had to be discharged.

The following discussion proceeds on the basis that the jurisdiction conferred by s 88F is exercised by a Full Bench though plainly it can also be exercised by a Presidential Member: see s 88F(5). It can be seen from the reasons of the High Court just quoted that the nature of the jurisdiction conferred by s 88F could be ascertained by reference to two matters. The first was the scope of the powers conferred by the statute on a Full Bench both when hearing and when determining an appeal. The power of the Full Bench to take further evidence and the breadth of the powers available to dispose of the appeal tended to indicate that the Full Bench was required to exercise the power of the Industrial Registrar afresh having regard to circumstances existing at the time the Full Bench exercised its appellate jurisdiction. The second matter was the nature of the powers that might be exercised by the Industrial Registrar against which an appeal could be brought. It is clear that the subject matter on which the Industrial Registrar exercised the power and the statutory context in which it was exercised was viewed by the High Court as a material and probably critical consideration in ascertaining the nature of the appeal. That is, the proper construction of s 88F was to be ascertained by reference to the subject matter of the act or decision which was amenable to appeal under that section. Thus the subject matter of the appeal together with the powers conferred on a Full Bench when hearing it pointed to the conclusion that the Full Bench was to exercise the power of the Industrial Registrar unconstrained by any decision the Registrar may have made and by reference to circumstances existing at the time the Full Bench decided the appeal. It can be seen from the quoted extract of the joint judgment that the decision of the Industrial Registrar might be relevant in determining whether leave to appeal should be granted and in that context consideration could be given to whether the Registrar had, or had arguably, erred. However once leave was given that issue ceased to be relevant. Before considering further s 45 of the WR Act, it is convenient to identify how appeals have traditionally been characterized. A convenient summary is found in the judgment of Kirby P in Clark & Walker Pty Ltd v Department of Industrial Relations [1985] 3 NSWLR 685 at 690-691. His Honour said: … it is necessary for the Court to approach the resolution of the meaning of the word "appeal", guided by a number of helpful authorities: 1. The starting point is to have clearly in mind the various possibilities. In some cases it has been suggested that there are two basic forms of appeal competing for selection: cf Ex parte Australian Sporting Club Ltd; Re Dash(1947) 47 SR (NSW) 283; 64 WN 63. In other cases, it is suggested that there are three different kinds of appeal: see Wigg v Architects Board of South Australia [(1984) 36 SASR 111]. But in Turnbull [[1976] 2 NSWLR 281], Glass JA catalogues no fewer than six forms of litigious process loosely called "appeal" (at 297-298): "… Appeal is a term loosely employed to denote a number of different litigious processes which have few unifying characteristics. They vary greatly in the extent to which the appellate court may interfere with the result below. Graded in ascending order, in accordance with the width of the corrective power exercised by the appeal court, they are as follows: (a) Appeals to supervisory jurisdiction. Only errors going to jurisdiction or denials of natural justice can be ventilated. (b) Appeals on questions of law only, for example, from the Workers' Compensation Commission. Undetermined or wrongly determined issues of fact must be remitted. (c) Appeals after a trial before judge and jury. The result below will be disturbed if the judge fell into error of law, or if the jury's errors of fact transcend the bounds of reason. But, except for the assessment of damages, issues of fact must be redetermined in a new trial. (d) Appeals from a judge in the strict sense, for example, appeals to the High Court. If the judge has fallen into error of law, or has made a finding of fact which is clearly wrong, the appellate court will substitute its own judgment. Only such judgment can be given as ought to have been given at the original hearing. Later changes in the law are disregarded and additions to the evidence are not allowed: Victorian Stevedoring and General Contracting Co Pty Ltd and Meakes v Dignan (1931) 46 CLR 73 at 107. (e) Appeals from a judge by way of rehearing, for example, appeals under s 75A of the Supreme Court Act 1970. Judicial opinion differs on whether a power to receive fresh evidence is implied: Ex parte Currie; Re Dempsey (1968) 70 SR (NSW) 1; 88 WN (Pt 2) 193. Almost invariably, however, it is expressly conferred. If errors of law or wrong findings of fact have occurred below, the appellate court will try the case again on the evidence used in the court below, together with such additional evidence as it thinks fit to receive. Since it will decide the appeal in the light of the circumstances which then exist, changes in the law will be regarded … (f) Appeals involving a hearing de novo, for example, appeals from a Court of Petty Sessions to a Court of Quarter Sessions. All the issues must be retried. The party succeeding below enjoys no advantage, and must, if he can, win the case a second time: Sweeney v Fitzhardinge (1906) 4 CLR 716. This catalogue of classes of appeal has, in the present case, to be approached with some caution. It involves observations that, in many respects, concern appeals within the court hierarchy or to a court from an administrative board or body. The Commission does not exercise the judicial power of the Commonwealth nor is it a court. However its functions are not entirely alien to the functions of a court: see Re Cram; Ex parte Newcastle Wallsend Coal Co Pty Ltd (1987) 163 CLR 140 at 148-149. However as Gibbs CJ observed in R v Moore; Ex parte Australian Telephone and Phonogram Officers Association (1982) 148 CLR 600 at 613 after quoting from the judgment of Lord Reid in British Oxygen Co Ltd v Board of Trade [1971] AC 610 at 625: As the words of Lord Reid indicate, it would be wrong to apply literally to the situation of the Commission statements of principle enunciated in relation to the exercise by other tribunals or administrative bodies of discretionary powers different from those exercised by the Commission. The Commission stands in a special position, not directly comparable with that of other administrative or quasi-judicial tribunals. Reference was earlier made to observations of McHugh JA in Strange Muir v Corrective Services Commission concerning an appeal to an administrative body from an administrative decision. McHugh JA discussed the proper approach to the characterization of administrative appeals. His Honour first referred to the judgment of Sheppard J in Horne v Locke [1978] 2 NSWLR 88 and Smithers J in Drake v Minister for Immigration and Ethnic Affairs (1979) 46 FLR 409. McHugh JA then said (at 250): It is true that these two decisions were not uninfluenced by the terms of the legislation which they were considering. Nonetheless they are consistent with the principle that, in the absence of a contrary legislative indication, the conferring of a right of appeal to an administrative tribunal against an administrative decision is not a grant of jurisdiction to make a fresh or original decision. Uniformity of approach in this area of the law is highly desirable. Accordingly, I think that those two cases should be taken as establishing that there is a presumptive rule that in an administrative appeal to an administrative body the issue is whether the decision was correct when it was made. The hearing is not de novo. This is so whether or not the tribunal is empowered to hear additional evidence. The correctness of this approach was doubted by a Full Court of the Supreme of Victoria in McDonald v Guardianship and Administration Board (1993) 1 VR 521. In Maritime Services Board v Murray (1993) 52 IR 455 Kirby P observed at 463: The appellant sought to extract from Strange-Muir, and the qualified support given to it, by reference, in Re Coldham, a settled rule of law governing all appeals from administrative decisions to administrative tribunals. I would doubt the existence of such a rule. If it exists, it is no more than a principle to aid in the ultimate task to which the High Court drew attention in Re Coldham. This is to try to find what Parliament intended by the particular "appeal" provided by the legislation in question. However the observations of McHugh JA in Strange-Muir v Corrective Services Commission were referred to by the Court in Brideson (No 2) as if they might assist in ascertaining the true character of an appeal heard by the Commission though, in relation to an appeal heard under s 88F, the language of the section and the subject matter of the appeal led to a conclusion which did not reflect the presumptive rule identified by McHugh JA. Section 45 might be approached on the footing that all appeals that might be brought under it are appeals of the same character. That is, appeals against all the matters identified in the paragraphs (a) to (g) in s 45(1) are of the same character irrespective of whether the decision, act or function referred to in the paragraph involved the exercise of discretionary power or involved the exercise of a non-discretionary power such as determining whether the Commission had jurisdiction in a particular proceedings. On this approach the judgment of the High Court in Brideson (No 2) would lend strong support for the view, or even dictate, that the Full Bench, if it grants leave, engages in the task described in the judgment of the Court in Brideson (No 2). That is because the appeal arising under s 45(1)(g) concerns essentially the same, though in some respects wider, powers that were the subject of appeal under s 88F and considered in Brideson (No 2). That approach denies, when determining the appeal, the operation of the principle discussed by the Full Bench of the C&A Commission in the AWU v Poon Bros and recently confirmed by a Full Bench of the Commission in Asahi Diamond Industrial Australia Pty Ltd v Automotive Food Metals and Engineering Union (1995) 59 IR 385 which was a bench constituted by the President, the two Vice Presidents and two other members of the Commission. That Full Bench confirmed that the approach of the Commission in determining an appeal against the exercise of a discretionary power should be that identified in Poon Bros v Australian Workers Union. However such an approach to the jurisdiction created by s 45 would ignore the disparate range of powers and functions that are amenable to appeal under s 45. As was apparent from the decision of the High Court in Brideson (No 2) the nature of the power that is subject to appeal is a material, if not critical, consideration in ascertaining the nature of the appeal. It is not a novel proposition that the nature of the power which is amendable to appeal is material in ascertaining the nature of the appeal: see Turnbull v New South Wales Medical Board [1976] 2 NSWLR 281 at 285 and 298. Section 45 enables an appeal to be brought against the exercise of a discretionary power as well as powers which involve no discretion such as finding or not finding the existence of an industrial dispute. Section 45(7) confers wide powers on a Full Bench when hearing an appeal and the nature and scope of the powers are consistent with an appeal in which the Full Bench would simply exercise afresh the power from which the appeal was brought. However they are equally consistent with an appellate function where, if the appeal was against the exercise of a discretionary power, the appellate jurisdiction of the Full Bench was limited to ascertaining whether the discretion was erroneously exercised and if it was, correcting the error. The fact that the Full Bench may entertain further evidence is not inconsistent with a strict appeal: see Duralla Pty Ltd v Plant (1984) 2 FCR 342, though the approach to be adopted in a review of a discretionary decision may alter if fresh evidence is led because the factual matrix in which the exercise of the power would have to be considered might have altered: see Petreski v Cargill (1987) 18 FCR 68 at 75 and the observations of Toohey and Gaudron JJ in Mickelberg v The Queen (1989) 167 CLR 259 at 298. The better view is that s 45 was intended to create several types of appeal with differing characteristics having regard to the power, act or function against which an appeal can be brought. The powers, acts or functions are identified in s 45(1). If the power, act or function is one that is truly discretionary, such as a decision under s 111(1)(g) to refrain from further hearing a dispute: see s 45(1)(d), then the appellate function of the Full Bench, if leave to appeal is given, involves ascertaining whether the exercise of the discretion was attended by appellable error of the type discussed in House v The King. The rationale for the appeal being of that character was discussed by Mason and Deane JJ in Norbis v Norbis (1986) 161 CLR 513 at 518-519: The sense in which the terms "discretion" and "principle" are used in these remarks [from House v The King] needs some explanation. "Discretion" signifies a number of different legal concepts: see, e.g., the discussion in Pattenden, The Judge, Discretion, and the Criminal Trial (1982), pp. 3-10. Here the order is discretionary because it depends on the application of a very general standard - what is "just and equitable" - which calls for an overall assessment in the light of the factors mentioned in s. 79(4), each of which in turn calls for an assessment of circumstances. Because these assessments call for value judgments in respect of which there is room for reasonable differences of opinion, no particular opinion being uniquely right, the making of the order involves the exercise of a judicial discretion. The contrast is with an order the making of which is dictated by the application of a fixed rule to the facts on which its operation depends. The principles enunciated in House v The King were fashioned with a close eye on the characteristics of a discretionary order in the sense which we have outlined. If the questions involved lend themselves to differences of opinion which, within a given range, are legitimate and reasonable answers to the questions, it would be wrong to allow a court of appeal to set aside a judgment at first instance merely because there exists just such a difference of opinion between the judges on appeal and the judge at first instance. In conformity with the dictates of principled decision-making, it would be wrong to determine the parties' rights by reference to a mere preference for a different result over that favoured by the judge at first instance, in the absence of error on his part. According to our conception of the appellate process, the existence of an error, whether of law or fact, on the part of the court at first instance is an indispensable condition of a successful appeal. If on the other hand the appeal under s 45 is against the exercise of a power, act or function which is not discretionary such as a decision that a member has jurisdiction: see s 45(1)(g), or is, additionally, a function that must be exercised by reference to current facts (that is, facts existing at the time the Full Bench hears the appeal) such as a decision of a designated Presidential member under s 189 to register an association of employees as an organization of employees: see s 45(1)(f), then the powers and functions of the Full Bench are not so constrained. Further, if the appeal is against the exercise of a discretionary power, and the Full Bench permits the tender of evidence that alters the factual matrix by reference to which the power had earlier been exercised, then, as earlier discussed, that would bear upon the application of the principles in House v King. It would not, however, alter the nature of the Full Bench's jurisdiction.

There is nothing in the WR Act that clearly indicates that a Full Bench is, in exercise of powers conferred by s 45, intended to have some general supervisory role over the exercise of discretionary powers exercised by single members of the Commission in the absence of appellable error. That is, a supervisory role involving the exercise afresh of the discretionary power in the absence of error. Indeed the existence of the mechanisms in s 106, s 107, s 108 and s 109 for referring matters to a Full Bench tells against such a construction. Those sections enable a party or the Minister to apply to have an industrial dispute, an order or award (or a related decision) or principles concerning the making or varying awards in relation to allowable award matters dealt with or reconsidered by a Full Bench or for the President to assume control of the proceeding with that ultimate effect. Proceedings involving these matters can be heard and determined by a Full Bench which can exercise the powers that would otherwise be exercisable by a single member (or have been in relation to a matter dealt with under s 109). In that way the exercise of several of the more significant powers of the Commission can be undertaken by a Full Bench which can establish principles for the exercise of those powers more generally: as to a similar mechanism in the C&A Act see R v Moore Ex parte Australian Telephone and Phonogram Officers Association (1982) 148 CLR 600. The existence of these express provisions providing these mechanisms tells against the appellate jurisdiction arising under s 45 as being generally for the same purpose, that is, as a mechanism of general application for a Full Bench to exercise a supervisory jurisdiction in the absence of appellable error.

The manner in which the Full Bench exercised the jurisdiction conferred by s 45 On 29 January 1998 orders were made by the Full Bench quashing the orders of Justice Boulton. Each of the members of the Full Bench gave separate reasons for decision. In his reasons, Justice Giudice first set out the principle findings of Justice Boulton then turned to the submissions made by the parties to the Full Bench. His Honour identified the appeal as one brought under s 45(1)(b). That is, against the orders of Justice Boulton. Justice Giudice then commenced to consider the principles applicable to an appeal. He said: The decision and orders made by Boulton J are the product of an exercise of discretion based upon considerations of mixed law and fact. The statutory test guiding the Commission in determining whether leave to appeal should be granted is that the Commission be satisfied that the matter of the appeal is of such importance that it is in the public interest that leave should be granted. In that context, it is usual to require that an appellant demonstrate that it has reasonable grounds for contending that the decision subject to appeal reflects a manifest error of principle or a fundamental misconception of the facts. Demonstration of an arguable case has generally been accepted in the Commission and its predecessors to be a determinative consideration in answering the question of whether the matter of the appeal is of such importance that it is in the public interest that leave to appeal should be granted. The continued determination of leave to appeal by reference to that consideration is encouraged by observations of Gaudron J in Brideson No 2 and Public Service Association (SA) v Federated Clerks Union. That encouragement is subject to the qualification stated in PSA (SA) to the effect that an Appeal Bench must determine an application for leave to appeal on the basis on which leave is sought. In the Commission's practice, the decision of the Full Bench in Asahi Diamond Industrial Australia Pty Limited and Automotive, Food, Metals and Engineering Union Print L9800 appears to have been intended to sustain a practice established from at least the 1983 decision in The Australian Workers' Union v Poon Bros (WA) Pty Ltd (1983) 289 CAR 269 until it came to be doubted because of the decision in Brideson No 2. That practice treats the demonstration of error as the determinative consideration on the merits of an appeal from the exercise of a discretion. The strict application of that practice, even to matters demanding the review on appeal of a simple exercise of arbitral discretion, involves a sometimes unacceptable risk. The risk is that a Full Bench determining an appeal by reference to that practice might be found to be itself in error. That error might be founded upon the conflict between the practice and the views expressed by various members of the High Court to the effect that an appeal under section 45 of the Act is in the nature of a rehearing, involving a responsibility on the Appeal Bench to determine for itself whether to confirm, quash or vary the decision or act subject to appeal. The notice of appeal in this matter presented each ground about the merits of the appeal as a ground also for claiming that it is in the public interest that leave to appeal be granted. The grounds stipulated include points going to jurisdiction, error of law, fundamental misconception of fact relevant to the determination, and failure to give any or adequate weight to considerations claimed to be relevant. Thus, there is a high degree of integration between grounds that are said to go to leave to appeal and those that go to the merits. Because of that integration, the case was heard and will be determined in a way that allows determination of the question of leave to be informed by the case presented on the merits. Only if it becomes necessary to do so will any distinction between the determination of the appeal by reference to its character as a rehearing and the determination of it by applying the principle as to review of a discretion outlined in House v The King and reiterated in Asahi be addressed. The discretionary power exercised by Boulton J in this matter to terminate three bargaining periods turns upon the requirements of subsections 170MW(1) and (3). So far as immediately relevant, those provisions read: [Justice Giudice then set out s 170MW(1) and (3)] It appears to be almost common ground on the appeal that for the power in subsection 170MW(1) to be exercised, it is necessary that: (1) the Commission Member be satisfied that at circumstance described in paragraph 170MW(3)(a) or (b) exists; and (2) the Commission Member determines that the power to make an order should be exercised having regard to that circumstance and to any consideration relevant to the discretionary power being exercised or not exercised. The grant of leave to appeal in this matter should be dependent upon the demonstration of the likelihood of error in the decision subject to appeal. However, having regard to the nature of the decision and of the surrounding circumstances, it may become necessary to assess whether those considerations alone would cause the matter of the appeal to be of such importance that it is in the public interest that leave to appeal should be granted. His Honour adverts to the possible effect of the decision of the High Court in Brideson (No 2) on the proper construction of s 45 and the nature of the appellate jurisdiction of a Full Bench under that section. It is not clear, however, whether he views the jurisdiction as one where, if leave to appeal was granted, the hearing of the appeal would or would not be governed by the principles in House v King. However from later remarks it appears Justice Giudice took the view that, in relation to an appeal from the exercise of the power under s 170MW(1), the principles in House v King had relevance. His Honour appears to proceed on the basis that the only ground for the grant of leave to appeal is that identified in s 45(2). Returning to his reasons for decision, Justice Giudice went on to deal with the construction of sections 170MW(1) and (3) in the context of the decision of Justice Boulton. First, he noted that the words "if it is satisfied" imported "a measure of subjective judgement or assessment on the part of the Commission Member or Members constituting the Tribunal for purposes of the exercise of the power in subsection 170MW(1)." His Honour said this jurisdiction was predicated on the Commission's satisfaction as to the existence of a circumstance identified in subsections 170MW(2) to (7) of the WR Act. Justice Giudice noted there was well established authority to the effect that a tribunal's or public officer's "satisfaction" in such a context must not be exercised capriciously and must be based upon relevant considerations and the evidence. He observed that "unless such satisfaction is shown to be unreasonable the appeal or judicial review tribunal would not generally intervene to set aside such an assessment" and would not ordinarily do so to substitute its own view on how the discretion should be or should have been exercised in the matter. However of some significance in the present proceedings, Justice Giudice went on to say that "principle does not preclude the Commission at Full Bench level from exercising a supervisory function on the merits of particular instances". This was said to be a concomitant of the appellate function under s. 45 so as to ensure consistency of approach to the exercise of the discretion. Justice Giudice did not explain the statutory foundation for this notion of the supervisory function exercised by the Full Bench. What his Honour appears, in substance, to have done was to characterize, correctly, the nature of the power conferred by s 170MW(1) and identify, correctly, the scope of the grounds upon which its exercise could be impugned but also to lay a foundation for some wider basis for reviewing the exercise of the power by Justice Boulton having regard to "the supervisory function" of a Full Bench. That this was the approach of his Honour is apparent from his later detailed analysis of Justice Boulton's reasons for decision and criticisms of it. It resulted in his Honour misconceiving the nature of the power exercised by Justice Boulton and identifying errors that, in truth, were not errors but incidents of the proper exercise of the power by Justice Boulton. The appellate jurisdiction arising under s 45 is not, in relation to the exercise of a discretionary power, a means of facilitating the exercise of the discretion in the way a Full Bench believes is appropriate, in the absence of error, under the guise of exercising a supervisory function. Justice Giudice then referred to Justice Boulton's finding under s 170MW(3)(a) that identified the relevant circumstance as one that "exists or existed". He noted that Justice Boulton's decision "did not discuss any difference between the use of the present and past tense in subsection 170MW(1)" nor did Justice Boulton "develop any reasons for such differences in the application to the issues and evidence". Justice Giudice did not acknowledge that this was not an issue which Justice Boulton was required to determine. Justice Giudice then construed the words "exists or existed" in subsection 170MW(1) on the footing that they were to be read distributively in so far as they correlated with the relevant other subsections of s 170MW. That is, his Honour adopted the first of the approaches to the construction of s 170MW discussed above. He concluded that in order for the Commission to be satisfied as to the circumstance in either of paragraphs (a) or (b) of 170MW(3) the circumstance must exist at the time the discretion is exercised under s 170MW(1). As we have noted above, we have not found it necessary to reach a concluded view on the proper construction of s 170MW. However, even on the construction adopted by Justice Giudice, there was no error on Justice Boulton's part. The identified circumstance that Justice Boulton was satisfied about arising from the provision of s 170MW(3)(a) was that the strike "is threatening" to endanger the welfare of the people of the Hunter Valley. Justice Boulton's later use of the expression "exists or existed" was no more than a formal recitation of the language of the section and isfairly to be read in conjunction with his earlier express finding. To seize on the recitation of the language of the section is to scrutinize inappropriately Justice Boulton's reasons: see Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259 at 291 per Kirby J. Justice Giudice then turned to consider what was comprehended by the expression "industrial action that is being taken to support or advance claims in respect of the proposed agreement …" in s 170MW(3). He decided that the industrial action to be taken into account could include secondary action such as sympathy strikes if such action were taken "to support or advance claims in respect of the proposed agreement". Justice Giudice indicated that: Conduct that is not capable of being industrial action within the meaning of the Act is not a proper subject for assessment even if it is thought to be in support of the proposed agreement. Thus, in this case, laying spikes on the mine perimeter is not within the definition. Nor can such conduct be conceived to be a sufficiently proximate effect or incident of industrial action that is being taken to support claims. Justice Giudice then observed that picketing activity was "distinct". The clear implication from this passage, confirmed by later observations of Justice Giudice, was that picketing could not be taken into account for the purpose of achieving the requisite satisfaction. This approach involves too narrow a conception of the circumstance identified in s 170MW(3). If industrial action in support of or to advance claims in respect of a proposed agreement is undertaken it will have direct and probably indirect consequences. Those consequences may have an effect on the welfare of a community or the economy or part of it in a way that leads to satisfaction of the type contemplated by the combined operations of s 170MW(1) and (3). Statutory indications to the contrary apart, causation is to be resolved by the application of common sense: see March v Stramare (E & MH) Pty Ltd (1991) 171 CLR 506 and Wardley Australia Ltd v Western Australia (1992) 175 CLR 514. Industrial action such as a strike can lead directly to picketing. That is because employees who would otherwise be required to work are free, in the sense of uncommitted, to engage in picketing. Further, the grievance that led to the strike would most likely sustain the picketers in their picketing in the sense that it would motivate them to maintain the picket. Common sense suggests that there will be situations where the effect of picketing undertaken by striking employees can be viewed as an effect of the strike itself, though an indirect one. Thus, in ascertaining the effect of the strike, in the situation just discussed, it is legitimate to consider the effect of the associated picketing. Justice Giudice went on to consider the scope of various expressions in s 170MW(3). Justice Giudice then proceeded to discuss an issue that is central to these proceedings. He observed that "the main thrust of the appeal was that the evidence before Boulton J was not sufficient to support the findings made". He then commenced to consider the evidence before Justice Boulton. Relevantly, Justice Giudice referred to: (a) the evidence of Mr Davies, the general manager of operations at Hunter Valley No.1 Mine in the s. 166A proceedings on 15 September 1997 that referred to "a large number of contractors" not providing services to the mine because of their awareness of the picketing activity and their concern about their own business future, being scared that their business may be effected because of "the influence placed on them, not only by other companies but by the unions which operate in those companies"; that the coal separation plant was operating at "a significantly reduced rate; and that a value of 40 million dollars in lost sales could be attributed to the six week strike and picketing in June 1997"; (b) the evidence of Mr Royle that picketing activity involved an appeal to people to not place themselves in a position of helping Coal & Allied, to not enter the mine and perform normal work; (c) the further evidence given by Mr Davies on 18 September 1997 that the mine is one of the largest mines in the Hunter Valley region, that all of the coal it produces is exported representing 3% of the national black coal exports and 1˝% of the national black coal production overall. The evidence of Mr Davies that in 1996 the mine exported 5 million tonnes of about 140 million exported nationally which represented about 7.9% of the annual loading capacity of Port Waratah. That in 1997 Coal & Allied paid $11 million to the State Government in excise, $3 million in payroll tax, $2 million in rail freight charges and $4 million in electricity charges. That for the 1996 year the complete wages and salaries bill including on-costs was $58 million. Mr Davies evidence was that the strike was having little impact on profitability because the mine had recently been operating at break even point; (d) Mr Davies' evidence that since 8 September 1997 the mine had been operating with 70 staff and a small number of production and engineering employees who were not on strike. The remainder of the usual workforce of 420 had been on strike since 8 September 1997. The operating capacity during the September strike was slightly less than 1/3 of normal capacity. Mr Davies evidence was that the impact of the strike was "not dissimilar" to that experienced in June and July 1997; (e) Mr Davies' evidence concerning the effect of the strike on associated contractors - he acknowledged that on 18 September 1997 the contractor activity was reduced but said that the impact of the reduction across the Hunter Valley on general contractors "would be fairly small"; (g) evidence of Mr Davies concerning his statement in the newsletter of 19 June 1997 that the strike was hurting everyone and costing one million dollars a day in lost income to the Mine and that most of that money would have gone back into the pockets of employees, suppliers and contractors who lived locally. Mr Davies had agreed in cross examination that the impact of the two stoppages was very similar. However the distinctions made by Mr Davies were that during the first stoppage stockpiles were full; during the second there was plenty of room to produce coal; the use of contractor services was higher during the September strike, and, that during the early part of the first stoppage no coal was produced meaning revenue loss associated with no sale of the produce was one million dollars a day. During the second stoppage the operating capacity was based on using fewer staff for one shift suggesting slightly less than 1/3 of the revenue loss. Emerging also from Mr Davies' evidence, was that the total loss of revenue on the calculation put forward by Mr Davies for the second strike would have been around $40 million being the same as the June/July strike; (h) Mr Davies' evidence on 18 September 1997 in response to questions from Justice Boulton where Mr Davies estimated that there was a 30-50% chance of a national stoppage in the coal industry involving companies beyond Rio Tinto and its subsidiaries (including Coal & Allied) and a fairly low likelihood of there being a major problem caused by related industrial action in Port Waratah. Further Mr Davies evidence was that the chances of an agreement being reached with the unions was low and the chance of reaching an agreement with employees or groups of employees in the then current environment would not be easy. Mr Davies evidence was that industrial action could run for months before agreement could be reached; (i) The affidavit of Mr Davies sworn on 24 September 1997 which relevantly outlined the history of the dispute; the affidavit of Mr Moore of 23 September 1997 concerning the effect of the picketing on contractors; the evidence of Mr McPhee in his affidavit of 22 September 1997 concerning the effect of industrial action on sales of coal. Mr McPhee's evidence "showed there was some loss to the company arising from each of the diverted orders but that there was no overall quantification of that loss"; (j) the evidence, that it was not disputed in the appeal, that no coal had been shipped from the mine since the September 1997 strike commenced; (k) the totality of the evidence indicating that despite a stockpile of some four hundred thousand tonnes as at 12 September 1997 and some production related to its reduced operating capacity no deliveries could be made. This had led to losses and would lead to further losses from the deferral of supply and in some cases the loss of orders altogether - the evidence, it was said, fitted within the perspective of Mr Davies oral evidence that the stockpile of coal in the region was high and that the Port of Waratah was operating at capacity; (l) the transcript of the hearing before Commissioner Harrison on 10 October 1997. That evidence related to the 72 hour stoppage in all coal mines in the northern district region. Representatives of various coal producers told the Commission in those proceedings what the effect of the strike would be on them. The submissions in that matter indicated fears that the mines in the northern district generally were on the threshold of a major industrial campaign "unless the Commission and other pressures could be brought to bear to dissuade the CFMEU from the type of campaign contemplated". A representative of the New South Wales Minerals Council listed the daily loss calculated by each of several companies totalling $900,000.00 for the 72 hour strike and that such industrial action would create serious damage to the economy of New South Wales and not only the companies concerned. (m) evidence concerning the resolution of 600 delegates of unions affiliated to the Newcastle Trades Hall Council passed on 21 October 1997. The resolution included an undertaking to mobilise membership in all industries in defence of Hunter Valley No.1 members and their families if the dispute could not be settled by arbitration. The mobilisation called for financial support, support stoppages and stop work report meetings and other activities; (n) evidence of resolutions passed by the Singleton Shire Council and the Cessnock City Council - urging a resolution of the dispute. (o) evidence of a resolution passed in the New South Wales Legislative Assembly expressing concern for the effect of the dispute upon the Hunter Valley and the New South Wales economy and the warning of the devastating impact upon the New South Wales and National economy of a further prolonged or escalated dispute. (p) an article in the Singleton Argus which referred to the loss in the Singleton community. In relation to the council and parliamentary resolutions and the newspaper article Justice Giudice said: In relation to evidential material of this kind, it must be observed that it is the Commission, and no one else, that is required to form a relevant opinion. Evidence conducive to the formation of that opinion, if that evidence exists, must be put before the Commission. The fact that a representative body expresses an opinion of the kind set out in the resolution and associated speeches is relevant and probative of the issue about which the Commission may satisfy itself in such manner as it sees fit. Nonetheless, it is far from being compelling and direct evidence of facts in issue. Justice Giudice returned to the findings made by Justice Boulton pursuant to s. 170MW(3) and first focused upon the finding made under subsection 170MW(3)(a). He then proceeded to criticize the evidentiary case upon which Justice Boulton's findings were made. In particular: (a) Justice Giudice found that the evidence of the effect of the strike on the 400 striking employees was scant; (b) he indicated there was "almost" no evidence about the effect of the strike on the business of contractors either in the affidavits and material in the Supreme Court or in the Parliamentary debates. There was no refutation of Mr Davies evidence that the impact of the strike on general contractors across the Hunter Valley "would be fairly small". (c) in respect of both of these matters, Justice Giudice found that Justice Boulton failed to make clear in what way a threat was constituted to the welfare of the population of the Hunter Valley community as a whole - this was said to be in sharp contradiction to other cases under paragraph (a) in which, for example, threats to medical, psychiatric or fire protection services had been considered; (d) Justice Giudice then referred to Justice Boulton's reference to the divisions and social tensions the action was causing within the local community. This evidence, Justice Giudice said, "might have" emanated from expressions of concern as found in the evidence, but for reasons earlier expressed about the opinion held by others, Justice Giudice concluded that the evidence fell short of establishing a threat to the welfare of the population of the Hunter Valley region; (e) Justice Giudice rejected Justice Boulton's reliance upon the Parliamentary debates and the extract from the Singleton Argus - those pieces of evidence were not of themselves sufficient to found conclusions about the collective welfare of the Hunter Valley population; (f) Justice Giudice then turned to the evidence of Mr Davies on 19 June 1997 and other evidence about loss of revenue and concluded that it was a fair assumption that the loss in revenue resulting from the strike was in the vicinity of one million dollars per day. The statement indicates that "most" of the revenue would have gone to employees, suppliers and contractors who lived locally. Justice Giudice identified these as economic effects. However, he said that there was no connection established between the economic loss to the region, whatever it might actually be, and the welfare of the population of the region. Justice Giudice held that any loss of revenue through failure to ship coal could not in any relevant sense be caused by industrial action within s 170MW(3) of the WR Act - the failure to ship coal, "it might be inferred" was the result of a tactical judgement made in the overall context of the dispute between the parties. This was said to be a different matter and not relevant to what Justice Giudice described as "the finding of fact required pursuant to 170MW(3)". It was said that Coal & Allied's criticism of Justice Boulton's reliance upon Mr Davies statement had some force. What followed in Justice Giudice's reasons is an important passage that should be set out in full: Boulton J went on to consider the effects of the conduct associated with the strike, in addition to the effect of the strike itself - the broad view. "Taking the broad view of s 170MW(3) and including in the consideration industrial conduct associated with the strike action at the Mine, namely the picketing at the Mine, the sympathy action that has been taken at other Hunter Valley coal mines and the potential for the dispute to escalate within the coal industry and other industries in the region and beyond, there is also a reasonable basis for the Commission being satisfied that the industrial action at the Mine is threatening to endanger the welfare of the people of the Hunter Valley region. In addition to the material earlier referred to, the evidence for this conclusion includes that concerning the impact of the picketing on contractors and suppliers to the Mine given by Mr Moore and the decisions taken by the unions affiliated to the Newcastle Trades Hall Council on 21 October 1997 to take action in support of the Hunter Valley No. 1 Mine workers and their families. Coal & Allied submitted that in taking into account the conduct he identified in this paragraph, Boulton J made fundamental errors which may be summarised as: · taking into account action which was not industrial action for the purposes of s 170MW(3) or, alternatively · assuming that the threatened escalation would be taken to "support or advance claims in respect of the proposed agreement". Before dealing with those submissions it is relevant to point out that His Honour does not seem to have thought it significant that the unlawful picketing had ceased. Nor did he refer to the fact that the sympathy action taken at other coal mines, while originally scheduled for 72 hours, had voluntarily been reduced by the unions to a stoppage of 24 hours. Moreover, there was no sympathy action occurring at the time. Those matters apart, Coal & Allied's submission that His Honour took into account action which was not industrial action for the purposes of s 170MW(3) is correct. His Honour's conclusion was influenced by an impermissible consideration, the threats that the dispute would escalate if the Commission did not impose arbitration. Any industrial action occurring, provided it is engaged in for the relevant purpose, can be considered when assessing whether a relevant threat exists under s 170MW(3) (see section 6.3 above). The threats of escalation in this case were not industrial action within the section, not least because they were directed towards the achievement of arbitration rather than an agreement. Nor was the prospect of escalation, including the effect it might have upon the welfare of the population, sufficiently proximate to the industrial action that was occurring i.e. the strike, to be taken into account in assessing whether the industrial action constituted a threat in the relevant sense at the time Boulton J was considering the matter. This is not to say that the threats of escalation would not be relevant pursuant to s 170MW(1). But before that stage was reached, a valid finding of fact was necessary pursuant to s 170MW(3). In the circumstances of this case the threats of escalation were not relevant to that fact finding exercise. For that reason His Honour's finding pursuant to the so-called "broad view" was in error. There remains the question of whether His Honour's conclusion on the "narrow view" should be disturbed. Some of the evidentiary matters which tend to undermine the conclusion that the strike itself was threatening to endanger the welfare of the population of the Hunter Valley region are discussed earlier in this section of the decision. In addition to those matters it is patent that there was a critical lack of evidence linking the effects of the strike to any perceived threat to the welfare of the population of the region. There is no evidence of the geographical area His Honour had in mind, the size of its population, the size of its workforce, the number of contractors the mine regularly engaged compared with the number of contractors in the region, the number of businesses effected [sic] compared with the number of businesses within the region, or the size of the regional economy. With great respect to His Honour, I have concluded that the finding was not firmly based on evidence of the requisite kind. Whether the error be characterized as an error in approach or in weighing the evidence, the finding was wrong in the sense that it was not reasonably open on the evidence. Before leaving s 170MW(3)(a) His Honour went on to consider whether the industrial action was threatening to endanger the personal safety of the people of the Hunter Valley region. Because of the conclusions he had already reached he indicated that he did not need to rely on the existence of a threat to personal safety. He declined to make a finding in that respect. Nevertheless it should be pointed out that his approach took into account "conduct associated with picketing at the mines, bus pick up points and the rail lines and about the finding of spikes on various mine roads". Such matters are not "industrial action" for the purposes of s 170M(3). (Emphasis added) The consideration by Justice Giudice, evident in this passage, of the approach that had been taken by Justice Boulton manifests a fundamental misconception, in our respectful opinion, of the Commission's role arising from the combined operation of s 170MW(1) and (3). As was noted earlier, the exercise of the power conferred by s 170MW(1) is not conditioned by the existence of one of the circumstances identified in the following subsections but the satisfaction of the Commission about their existence. Moreover the satisfaction may be based on impressions and involve elements of value judgment. It is not necessary, as Justice Giudice says in the lengthy passage following the quotation from Justice Boulton, for there to have been "a valid finding of fact … pursuant to s 170MW(3)". His observations that Justice Boulton's conclusion as to the existence of the circumstance identified in s 170MW(3)(a) on "the narrow view" was not firmly based on evidence of the requisite kind is a further manifestation of that misconception. Justice Giudice does say in the last sentence of the penultimate passage that Justice Boulton's finding was wrong "in the sense that it was not reasonably open on the evidence". It would have been an appellable error for Justice Boulton to have proffered a satisfaction which was not reasonably open to him having regard to the logically probative evidentiary material before him. In this regard, it is to be noted that Justice Giudice described the resolutions that had been passed by, inter alia, the New South Wales Legislative Assembly "as relevant and probative of the issue about which the Commission may satisfy itself …" However his Honour went on to say that "it is far from compelling and direct evidence of the facts in issue". That latter comment is a further manifestation of Justice Giudice's misconception about the nature and quality of the material capable of founding a satisfaction. The former comment is an acknowledgment that there was at least material on which Justice Boulton could have been satisfied in the relevant way. Questions of privilege aside, the fact that several members of Parliament had asserted that a strike was having a deleterious effect on the community they represented, and all the more so if it shows a measure of bipartisan unanimity, might be sufficient to found the requisite satisfaction. No issue, such as the motive of the members of Parliament, arose before Justice Boulton which could have given rise to an issue of Parliamentary privilege (Wright & Advertiser Newspapers Limited v Lewis (1990) 53 SASR 416). Moreover it is, with respect, specious to imply that Justice Boulton had in some way erred by failing to identify, or failing to refer to evidence which identified, the geographical area comprehended by the Hunter Valley, the size of its population and the other matters referred to in the penultimate paragraph in the extract of Justice Giudice's reasons quoted earlier. Following this part of Justice Giudice's reasons was a consideration of Justice Boulton's findings pursuant to s 170MW(3)(b). Justice Giudice did not undertake as detailed a review of the material on which Justice Boulton had been satisfied of the circumstance identified in para (b) as he had earlier done in relation to para (a). The following is, in part, Justice Giudice's reasons concerning para (b): His Honour's first conclusion under this subsection was that the industrial action at the mine was threatening to cause significant damage to an important part of the Australian economy; namely, the economy of the Hunter Valley region. "The strike action at the Mine has lasted for more than fourteen weeks. On the material presented and having regard to the circumstances of this particular dispute and the coal industry, it is unlikely that the disputation will be brought to an end quickly or that the matters in issue between the parties will be resolved by further negotiation. As stated in earlier proceedings, there is every sign that both the Company and the workers and unions involved have become resigned to a war of attrition extending over a considerable period of time before an outcome is achieved. This would mean a continuation of strike action by almost 400 workers at one of the largest coal mines in the Hunter Valley for an indefinite period. Given this potential, I am satisfied that the strike action being taken is threatening to cause significant damage to the economy of the Hunter Valley region." In this paragraph Boulton J indicated that his conclusion that a relevant threat existed was based upon his assessment that the strike would last for an indefinite period. He then specified the evidence which he took into account in reaching this conclusion. The evidence for this conclusion includes that earlier referred to and the assessment that I have made, based on my knowledge of the coal industry, of the potential for the disputation and the strike action to continue. The evidence also includes the testimony given in the proceedings by Dr William Paradise, the Research Director of the Hunter Valley Research Foundation, regarding the economic inter-relationship between various activities in the Hunter region and the potential for a strike in one industry to have multiplier effect on other sectors. There is room for argument as to the precise impact that industrial action at one coal mine in the region, albeit one of the largest, may have. This is evident from the cross-examination of Dr Paradise. However a prolonged stoppage at such a mine may well have the potential through its direct and associated effects to cause significant damage to the regional economy. It is evident that His Honour relied upon the evidence he had earlier referred to (presumably in dealing with s 170MW(3)(a)), his knowledge of the industry and the evidence of Dr Paradice. There is no need to repeat what has already been said concerning that evidence, both in the analysis of it in section 7.2 and in dealing with the findings under s 170MW(3)(a). The matters set out in dealing with those findings are also relevant to this part of the decision. Boulton J's comments about his knowledge and experience should not be taken as a reference to a separate species of evidence as such. His Honour was simply underlining the fact that he was in a good position to assess the evidence because of his knowledge of the industry. This was undoubtedly so. Nevertheless the appeal falls to be determined on the evidence presented. The evidence of Dr Paradice seems not to have been relied upon in a positive way by Boulton J at all. This is clear from the concluding sentence of the paragraph set out above, in which reference is made to the effect of a prolonged stoppage in terms signifying a potential threat rather than an actual one. The following can be said about this passage. Justice Boulton was quite properly entitled to call in aid his experience in making an assessment of the likely duration of the strike. It is no different, in principle, to the process described by Gaudron and Gummow JJ in Attorney-General for Queensland v Riordan (supra) at 1186 concerning whether a dispute was impending or probable: Their Honours said: (I)t is difficult to see that the Commission … could ever do more than form a view, as distinct from determining as a matter of fact, that a situation was likely to give rise to an industrial dispute or that a dispute was impending or probable. The question of whether a dispute was impending or probable and the question of whether a strike would continue are essentially the same question. That is, they both involve an assessment of whether, at some point after the assessment is made, there will be or continue to be industrial action. Plainly the past experience and prior knowledge of the member of the Commission would play a part, and an important part, in that evaluation. Justice Boulton was the head of the panel which included the coal industry, had been a Presidential Member of the Commission and its predecessor since 1986 and had been exercising powers in relation to the dispute at the mine for several months. His knowledge and experience was not merely to be treated as an aid in assessing evidence. It was a matter on which he was entitled to rely in reaching or not reaching satisfaction that a circumstance existed of the type identified in s 170MW(3) based on his assessment of how long the strike would last. The last sentence in the passage from Justice Giudice's reasons just set out distorts what Justice Boulton had said. Dr Paradise had given evidence about the potential adverse economic impact of the strike. Evidence that it could have this effect could plainly found an opinion that it was presently threatening the local economy. Justice Boulton was not attempting to draw distinctions between potential threats and actual threats. He was simply expressing a view about what could happen to the local economy if the strike continued, whether the local economy might be adversely affected and thus was being presently threatened. Justice Giudice then referred to Justice Boulton's conclusion concerning the circumstance identified in s 170MW(3)(b) on the broad view and indicated Justice Boulton had fallen into error in reaching the requisite satisfaction. As to the narrow view, Justice Giudice reviewed the evidence. He noted the evidence concerning the place of the mine in the broader economy was scant. He noted there was evidence that the mine produced 3% of the national black coal exports; exported around 7.9% of the annual loading capacity of Port Waratah and produced between 7% and 8% of the coal exported from New South Wales. Justice Giudice also noted that it was likely that the effect of the strike in aggregate to the date of hearing was a potential reduction of 2% in the amount of coal exported annually from the region. This was, in his view, to be weighed against the fact that Port Waratah was operating to capacity and a large number of ships was in queue to load. Moreover there was Mr Davies uncontested evidence that stockpiles contained between 5 and 10 million tonnes and would take 4 to 8 weeks to clear from the port without taking account of continuing production assuming the port continued to operate at full capacity. In Justice Giudice's view there was no evidence to suggest that the Port in the foreseeable future would be operating under capacity and that the indications were to the contrary. Justice Giudice then expressed the view that Justice Boulton's conclusion that the strike was threatening to cause significant damage to the Australian economy, the New South Wales economy, the economy of the Hunter Valley region or the coal industry was not reasonably open. Justice Giudice said that Justice Boulton had not been assisted in this case by any economic data, other than that which had been referred to earlier by Justice Giudice, by which to gauge the broader economic effects of the stoppage. Justice Giudice then said: No data concerning the size of the economy of the region - assuming that it extends beyond the black coal export industry - the size of the economy of New South Wales or any other data which would have enabled relevant quantifications to be made were produced. The economic evidence was not adequate to support a finding on the narrow view of s 170MW(3)(b). Nor did it support His Honour's conclusion on the wider view, which for other reasons was in error in any event. Justice Giudice speaks of the adequacy of the evidence and "a finding" under s 170MW(3)(b). He speaks of quantification in a way that implies that a measurable likely effect on the economy must be identified and then an assessment made whether that was "threatening … to cause significant damage". No such task is dictated by s 170MW(1) and s 170MW(3)(b). The obligation of the Commission is to determine whether it is satisfied. As long as there was some material that might reasonably found that satisfaction, then the Commission was empowered to exercise the discretion arising in s 170MW(1). Justice Giudice misconceived the task Justice Boulton had to undertake. The following is Justice Giudice's conclusion after he set out a passage from House v The King at 504-505:

In this case there is no doubt that Boulton J was exercising a discretion reposed in the Commission by s 170MW(1). As His Honour recognised, a pre-condition to the exercise of the discretion was his satisfaction that a relevant threat existed pursuant to s 170MW(3). For the reasons given His Honour's findings under that section were wrong. The findings based on the broad view of s 170MW(3) involved error in the construction and application of the section. Absent those errors the findings could not have been made. The findings based on the narrow view of s 170MW(3) were not reasonably open on the limited facts in evidence. The subject matter of the appeal touches important issues concerning the construction of s 170MW, in particular the operation of s 170MW(3). Section 170MW defines the circumstances in which the Commission may arbitrate to settle enterprise bargaining disputes. Section 170MW(3) is a most important part of the section. The way in which it is interpreted and applied has serious consequences for disputing parties and for the public at large. Its operation involves the resolution of the competing rights of registered organisations and employers to take industrial action against each other with impunity and of the community and the economy to be protected from serious harm arising from such industrial action. In all of the circumstances it is in the public interest that leave to appeal be granted. For the reasons given in section 8 of this decision I uphold the appeal. To avoid doubt I should record my view that on the material and evidence before the Commission no positive finding could properly be made pursuant to s 170MW(3). The orders terminating the bargaining period in each case should be quashed. In the circumstances it is not necessary to rule on that part of the decision which dealt with the exercise of discretion pursuant to s 170MW(1). For reasons already given, Justice Giudice reached this conclusion on a misconception of the nature of the power conferred by s 170MW. It appears that his Honour's decision to grant leave was based on the formation of an opinion that the matter was of such importance that in the public interest leave should be given. However central to the decision of Justice Giudice to exercise jurisdiction to quash the orders of Justice Boulton terminating the bargaining period was the misconception earlier referred to about the nature of the power conferred by s 170MW(1) and its exercise by Justice Boulton. Justice Munro approached the matter differently. He summarised his position in the following way: I am unable to agree with his Honour the President's conclusion that it was unreasonable for Boulton J to have been satisfied that the industrial action being taken was threatening to endanger the welfare of that part of the population comprised of the people in the Hunter Valley. In my view, Boulton J's satisfaction as to at least that paragraph 170MW(3)(a) "circumstance" was reasonably open to him on the cases presented. It follows, from my view on that point, that a jurisdictional prerequisite to Boulton J's exercise of the discretion in subsection 170MW(1) was established. His Honour the President's conclusion entails that it was not. However, I am satisfied that leave to appeal should be granted. Because of the view I take about the obligation on the Full Bench in the determination of this appeal as a re-hearing, I am satisfied it is appropriate that I should adopt part of his Honour the President's reasoning as the basis for my concurring in the order that will be made by this Full Bench under subsection 45(7) of the Act as a determination of the appeal. Much of the approach of Justice Munro accords with what has been said in this judgment about the proper construction of s 170MW. On the question of leave to appeal Justice Munro's approach was that irrespective of whether or not leave should be granted on grounds related to the alleged errors in Justice Boulton's decision, the matter was of the requisite importance that in the public interest an appeal should lie. Justice Munro then said that because the appeal is by way of rehearing, the Full Bench should be able to determine for itself how the power in s 170MW should have been, or should be, exercised. He then did so. For reasons already given, Justice Munro's approach involves an erroneous view of the appellate jurisdiction conferred by s 45 in relation to an appeal against the exercise of a discretionary power of the type conferred by s 170MW(1). After further detailed consideration of the issues, Justice Munro said that if he were bound by House v King he would not quash the order subject to appeal. He had, however, earlier indicated that he did not believe that it had been open to Justice Boulton to reach one of the conclusions he had, namely that the industrial action being taken was threatening to cause significant damage to the Australian economy. Justice Munro agreed with Justice Giudice that the appeal was by way of re-hearing and that therefore the Full Bench was obliged to determine for itself "whether it is satisfied that a circumstance within the meaning of paragraph 170MW(3)(a) existed at the time of Boulton J's decision" and whether it would exercise the discretion under sub-section 170MW(1) of the WR Act. Justice Munro then, in large part, adopted the reasoning of Justice Giudice in determining that the requisite degree of satisfaction was not established as to the existence of a circumstance identified in s 170MW(3). Accordingly he joined in making an order quashing the orders of Justice Boulton. The third member of the Full Bench, Commissioner Larkin, said: I have had the opportunity to read and consider the reasons for decision of His Honour the President and His Honour Justice Munro in this matter. I will concur and adopt His Honour the President's decision with the following reservation. I have weighed most carefully the reasons for decision of their Honours in relation to Boulton J's finding of the existence of a circumstance under s 170MW(3)(a). His Honour Justice Munro's analysis and determination on this point has force in many respects. It is not necessary for me to detail aspects on which I would agree or disagree in any relevant sense with their Honours' reasons which lead to their respective conclusions. On balance, and in taking a holistic view, I conclude that I am satisfied that it is appropriate that I adopt and concur with His Honour the President's conclusions. In adopting His Honour the President's determination on the outcome of the appeal, I would concur with the following view expressed by His Honour Justice Munro in his decision: There then appears an extract from the reasons of Justice Munro dealing with effect of the Full Bench's orders on the negotiating position of the parties and the need for consistency in exercising the discretion conferred by s 170MW(1). What Commissioner Larkin was saying is not clear. It is not clear whether, for example, she was adopting the conclusions of Justice Giudice and the reasons he gave for reaching them or the conclusions only. If the latter, her reasons for doing so are not clear. If the former it is difficult to understand her support, albeit tentative, for the analysis of Justice Munro concerning the existence of a circumstance under s 170MW(3)(a). It may be, that in referring to a holistic approach, she was indicating that she felt it was necessary to adopt all or nothing of the decision and reasons for decision of either Justice Giudice or Justice Munro. That is, she effectively had to elect between them. If so, then she was not discharging the duty reposed in her as a member of the Full Bench of deciding the appeal on its merits rather than preferring one or other of the decisions of the other members of the Full Bench.

Conclusion The error in the reasons of the Full Bench, namely its view that the appellate jurisdiction conferred on it by s 45 in relation to an appeal against the exercise of a discretionary power of the type conferred by s 170MW(1) was by way of re-hearing and that the Full Bench was not only competent, but obliged, to determine for itself 'whether it is satisfied that a circumstance within the meaning of para 170MW(3)(a) existed at the time of Boulton J's decision is not an error within jurisdiction. The error identified in this case resulted in a constructive failure to exercise the jurisdiction conferred on the Full Bench by s 45: Re Coldham & Ors; Ex parte Brideson (1988-9) 166 CLR 338 at 339; Ex parte Hebburn Ltd; Re Kearsley Shire Council (1947) 47 SR(NSW) 416 at 420, where Jordan CJ said: …if a mistake of law as to the proper construction of a statute investing a tribunal with jurisdiction leads it to misunderstand the nature of the jurisdiction which it is to exercise, and to apply 'a wrong and inadmissible test': Estate and Trust Agencies (1927) Ltd v Singapore Improvement Trust [1937] AC 898 at 917; or to 'misconceive its duty,' or 'not to apply itself to the question which the law prescribes': The King v War Pensions Entitlement Appeal Tribunal (1933) 50 CLR 228 at 242-3; 16 Austn Digest 808; or 'to misunderstand the nature of the opinion which it is to form': The King v Connell (1944) 69 CLR 407 at 432, in giving a decision in exercise of its jurisdiction or authority, a decision so given will be regarded as given in a purported and not a real exercise of jurisdiction, leaving the jurisdiction in law constructively unexercised, and the tribunal liable to the issue of a prerogative writ of mandamus to hear and determine the matter according to law: R v Board of Education [1910] 2 KB 165. While Munro J expressed the view that "Boulton J's satisfaction as to at least that paragraph 170MW(3)(a) 'circumstance' was reasonably open to him on the cases presented" and, at least on one view of the reasons of Commissioner Larkin, she agreed with that view of Munro J and Giudice J expressed the view that there was evidence "relevant and probative of the issue about which the Commission may satisfy itself", the hearing and determination of the appeal from the orders of Boulton J is not for this Court but for the Full Bench of the Commission. Accordingly, certiorari should go to remove into this Court the decision of the first respondents made on 29 January 1998 for the purpose of quashing the decision and order, and mandamus should issue to the first respondents commanding the hearing and determination in

accordance with law of the appeal from the orders of Boulton J made at Sydney on 7 November 1997. I certify that this and the preceding sixty (60) pages are a true copy of the Reasons for Judgment herein of the Court

Counsel for the Applicant: W R Haylen QC with R Reitano

Solicitor for the Applicant: R L Whyburn & Associates

Counsel for the Second Respondent: J N West QC with G J Hatcher

Solicitor for the Second Respondent: Freehill Hollingdale & Page

Counsel for the New South Wales Government (intervener) S Crawshaw

Solicitor for the New South Wales Government Crown Solicitor of New South Wales

Date of Hearing: 26-28 August 1998

Date of Judgment: 6 November 1998