Evenco P/L v Aust Bldg Cons Employees & Builders Labourers Federation Ors; Evenco P/L v Amalgamated Society of Carpenters, Joiners, [2000] QCA 108

INDUSTRIAL LAW - QUEENSLAND - MISCELLANEOUS MATTERS - OTHER CASES - breach of undertaking - whether inclusion of the term 'lawful' made the undertaking unclear - 'lawful' defined - undertaking in clear terms as there was no difficulty in identifying what was proscribed from a reading of undertaking itself

INDUSTRIAL LAW - QUEENSLAND - MISCELLANEOUS MATTERS - OTHER CASES - breach of undertaking - construction - whether proviso made the undertaking ambiguous - undertaking must be construed with regard to factual context in which it was made - true meaning readily ascertainable - meaning so obvious it must have been in the contemplation of BLF at time undertaking was given

PROCEDURE - CONTEMPT, ATTACHMENT AND SEQUESTRATION - BREACH OF UNDERTAKING TO COURT - proof beyond reasonable doubt - whether trial judges' findings on evidence were justified - whether fines manifestly excessive - whether trial judge took into account irrelevant considerations

INDUSTRIAL LAW - QUEENSLAND - MISCELLANEOUS MATTERS - OTHER CASES - breach of undertaking - construction - whether the inclusion of terms 'lawful agreement' or lawful supply' made the undertaking uncertain - whether terms 'impeding the performance of', 'procuring the breach of' or 'preventing the making of any lawful agreement' were so wide as to render the undertaking unenforceable - whether inclusion of the term 'and/or' created an ambiguity - true meaning of undertaking readily ascertainable

AMIEU v Mudginberri Station Pty Ltd (No 2) (1985) 9 FCR 194, considered

AMIEU v Mudginberri Station Pty Ltd [1986] HCA 46; (1986) 161 CLR 98, distinguished

AttorneyGeneral for Tuvalu v Philatelic Distribution Corporation [ 1990] 1 WLR 926, considered

Australian Consolidated Press Ltd v Morgan [1965] HCA 21; (1965) 112 CLR 483, followed

Bugge v Brown [1919] HCA 5; (1919) 26 CLR 110, considered

Deatons Pty Ltd v Flew [1949] HCA 60; (1949) 79 CLR 370, considered

DirectorGeneral of Fair Trading v Pioneer Concrete (UK) Ltd [1995] 1 AC 456, applied

House v The King (1936) 55 CLR 499, considered

Geoff Penney (Australia) Pty Ltd v Skyjack Computer & Office Supplies Pty Ltd & Ors [1990] ATPR 41-013, followed

GTS Freight Management Pty Ltd v Transport Workers Union of Australia [1990] FCA 78; (1990) 25 FCR 296, distinguished

Heatons Transport (St Helens) Ltd v Transport & General Workers' Union [1973] AC 15, approved

Latoudis v Casey [1990] HCA 59; (1990) 170 CLR 534, distinguished

Lloyd v Grace Smith & Co [1912] UKHL 1; [1912] AC 716, considered

Madierd v Roggette Pty Ltd [1990] 2 Qd R 357, considered

McIntyre v Perkes (1987) 15 NSWLR 417, considered

Meridian Global Funds Management Asia Ltd v Securities Commission [1995] UKPC 5; [1995] 2 AC 500, followed

Mudginberri ((1986) [1986] HCA 46; 161 CLR 98, considered

Morris v C W Martin & Sons Ltd [1966] 1 QB 716, considered

Re Galvanised Tank Manufacturers [1965] 2 All ER 1003, considered

Re Plumbers & Gasfitters [1987] FCA 117; [1987] 72 ALR 415, considered

Re Supply of Ready Mixed Concrete (No 2) [1995] 1 AC 456, considered

S & M Motor Repairs Pty Ltd v Caltex Oil (Australia) Pty Ltd (1998) 12 NSWLR 358, followed

Stancomb v Trowbridge Urban District Council [1910] 2 Ch 190, considered

State Rail Authority of New South Wales v Earthline Constructions Pty Ltd [1999] HCA 3; (1999) 73 ALJR 306, distinguished

Tesco Supermarkets Ltd v Nattrass [1971] UKHL 1; [1972] AC 153, considered

The Commissioner of Water Resources v Federated Engine Drivers' and Firemen's Association of Australasia, Queensland Branch [1988] 2 Qd R 385, distinguished

The Waterside Workers Federation of Australia v Burgess Brothers Limited [1916] HCA 2; (1916) 21 CLR 129, distinguished

Universal Telecasters (Qld) Ltd v Guthrie [1978] FCA 9; (1978) 18 ALR 531, considered

Vallance [1961] HCA 42; (1961) 108 CLR 56, followed

Witham v Holloway (1995) 183 CLR 525, followed

Worthington v Ad-lib Club Ltd [1965] 1 Ch 236, considered

Z Bank v DI & Ors [1994] 1 Lloyds LR 656, considered

Mr J S Douglas QC, with him Mr R Perry, for the appellants in Appeal No 3536 of 1999

Mr S Crawshaw SC, with him Mr D Rangiah, for the appellants in Appeal No 3610 of 1999

Dr C N Jessup QC, with him Mr G Martin SC, for the respondent in both Appeals

Quinlan Miller and Treston for the appellants in Appeal No 3536 of 1999

Paul Richards & Associates for the appellants in Appeal No 3610 of 1999

Maddern & Kearney for the respondent in both Appeals

[1] McMURDO P: I have read the reasons for judgment of Pincus JA and those of Williams J.

[2] As to the BLF appeal, I agree that the appeal should be dismissed for the reasons given by Williams J.

[3] As to the CFMEU appeal, the relevant facts are set out in the reasons of Williams J.

[4] I have reached the same conclusion as Pincus JA and Williams J but for slightly different reasons.

[5] It is, I think, settled law that a master or principal is liable if his or her servant or agent breaches an undertaking given by the master or principal in circumstances where he or she is acting on behalf of and within the scope of the authority conferred by the master or principal.[1]

[6] I am not satisfied that the learned primary judge materially erred in concluding that the CFMEU and Mr Trohear were liable for the actions of the union organiser Spinks, an employee of the CFMEU, as Spinks "was acting in the course of his employment" when he offended the undertaking. His Honour used the quoted term interchangeably with "acting within the scope of his authority". Whilst there was no evidence that Spinks had specific authority to act as he did in offending the undertaking, his actions were committed in the course of his employment whilst he was performing a function consistent with his duties as union organiser; the necessary authority may be tacit: see Geoff Penney (Australia) Pty Ltd v Skyjack Computer & Office Supplies Pty Ltd & Ors.[2]

[7] The CFMEU was obliged to take all reasonable steps, including, if necessary, the specific withdrawal of authority and even disciplinary action, to ensure that its responsible officers and their delegates who may handle matters within the scope of the undertaking, complied with the undertaking: see Re Galvanised Tank Manufacturers,[3] Heatons Transport (St Helens) Ltd v Transport & General Workers' Union,[4] Re Plumbers & Gasfitters[5] and Z Bank v DI & Ors.[6] A failure to comply with an injunction or undertaking may not amount to contempt where genuine and reasonable attempts to comply have been made.[7]

[8] On the facts found by the learned primary judge, which were fairly open on the evidence, Mr Trohear, the CFMEU State Secretary, did not take all reasonable steps to ensure that the CFMEU organisers, including Mr Spinks, were aware of the existence of the undertaking given by the CFMEU in March 1987. Until 1995, the training program for organisers included information about the undertaking and an explanation of what was required by the Union and its officials to ensure compliance. This ceased in about 1995, despite alleged breaches of the undertaking being brought to the attention of Mr Trohear in January and February 1994. Mr Spinks' actions occurred in 1997. In failing to ensure organisers were aware of the undertaking, Mr Trohear did not take all reasonable steps to ensure the undertaking was met. In those circumstances, Mr Spinks, in breaching the undertaking, was at least tacitly acting within the scope of his authority as an employee of the CFMEU.

[9] For the reasons given by Pincus JA and Williams J, the CFMEU was liable for its State Secretary's failings; Mr Trohear, who had been given notice of the undertaking[8] and indeed was a party to it, was also liable.

[10] On the remaining issues in the CFMEU appeal, I agree with what has been said by Williams J.

[11] In respect of both appeals, I wish to make the following comments as to penalty and costs.

[12] The costs order made by the learned primary judge in each action required the appellant to pay the respondent's costs on a solicitor and own client basis. Such an order was plainly within the proper exercise of discretion and in my view was entirely justifiable in this case.[9]

[13] The effect of an order indemnifying the respondent by requiring costs to be paid by the contemnor as between solicitor and client is to impose a further sanction or punishment for the contempt[10] and can be onerous. For that reason, it is unfortunate that consideration was given to the costs orders only after the determination of the penalties.[11] The penalties imposed in each case, especially when combined with the costs order, were heavy in the circumstances but it cannot be said that any of the orders were unreasonable or clearly unjust.[12]

[14] I agree with Williams J that both appeals should be dismissed with costs.

[15] I have read the reasons of Williams J relating to the BLF appeal (Appeal No 3536 of 1999). The principal arguments advanced by Mr J S Douglas QC, who led Mr Perry for the BLF, were put in support of the contention that the undertaking was too uncertain in meaning to be enforced. The terms of the undertaking are as follows:

"To refrain from doing or failing to do any act having the object [of] directly or indirectly preventing or hindering the servants or agents of the plaintiff ... or such building construction workers as the plaintiff may assign from time to time, from entering upon any building site situated in Queensland and from carrying out their lawful employment thereon, provided that the principal contractor on such site has been notified thereof and has made no objection thereto".

[16] One of the bases of Mr Douglas' argument was that the inclusion of the term "lawful" in the undertaking rendered it unenforceable. On that question I am in substantial agreement with the reasons of Williams J.

[17] Mr Douglas' other uncertainty point was that the words "thereof" and "thereto" do not, with reasonable certainty, refer to any activity mentioned earlier in the undertaking. It was argued for the appellant that the requirement of notification and lack of objection could rationally be applied to an "act having the object of directly or indirectly preventing or hindering the servants or agents of the plaintiff". If that were so then the undertaking would amount to this:

"We will not hinder the plaintiff's workers if the principal contractor does not object to our hindering them".

That would leave the BLF free to hinder the workers if the principal contractor objected to its doing so, a construction which would make the proviso have an absurd effect. The other view is that the proviso, when it uses the words "thereof" and "thereto", plainly refers to the activity the description of which immediately precedes it. On that construction, which is the one I favour, the proviso makes the undertaking operate only if the principal contractor does not object to the presence of the relevant workers on the site. The proviso can have a comprehensible operation attached (as the appellant contends) to the hindering act only if one reads "provided that" as meaning "unless"; in fact it means "if". For these reasons, I agree with the primary judge's conclusion on this point.

[18] As to the question whether the judge applied the proper standard of proof and reached proper factual conclusions, I agree with the reasons of Williams J.

[19] With regard to penalty, it has to be conceded in favour of the appellant that at first sight the total of the fines imposed, $60,000, appears to be high. But the findings the judge made justified a degree of harshness; his Honour was of opinion that the organiser who committed the breaches, although given no proper instruction about the undertaking, deliberately engaged in activity contrary to it, consciously defying the authority of the court. Those findings were not challenged and they support the level of fines imposed, as well as the order for costs made.

[20] I agree with Williams J that the BLF's appeal should be dismissed with costs.

[21] This appeal (Appeal No 3610 of 1999) raises a legal point, which is what has to be proved against an employer corporation to make it liable for contempt for disobeying an injunction. The same problem arises if the employer is not a corporation but a natural person.

[22] Here, the union was held liable for the act of an organiser, Spinks. The union secretary, Trohear, gave evidence that Spinks had no authority to deal with a member of another union and if that were so then the act complained of, which is explained in the reasons of Williams J, was one which was not authorised by the union.

[23] The learned primary judge did not find against the union that it had authorised Spinks' action. His Honour was right not to find that against the union because Trohear's evidence to the effect that it was not authorised was not contradicted, nor was it challenged in cross-examination. The fact of authority had to be proved beyond reasonable doubt and there was nothing to prove it. Inferences from what union organisers generally do could not fill the gap, nor could it be filled by judicial knowledge; if the question was simply whether Spinks had actual authority to act as he did, the case against the union had to fail.

[24] To prove a case against the union for contempt, on the basis of an act which it had not authorised, what had to be shown? A strict attitude against employers seems to have been taken in England where the House of Lords, as I think, has approved Rantzen v Rothschild (1865) 14 WR 94:

"In that case, an injunction was granted against the defendants, their servants, agents and workmen to prevent them from pulling down a party wall adjoining the plaintiff's house. Notice of the injunction was served upon the foreman who was superintending the works. The foreman could not read, but asked a policeman who was passing to read the notice. The policeman did so, and advised the foreman to disregard it. The foreman accordingly continued with his work. The defendants, when they themselves were served with the notice, took proceedings to stop the works". (in Re Supply of Ready Mixed Concrete (No 2) [1995] 1 AC 456 at 476)

Although the judge held in Rantzen v Rothschild that "no blame could attach to the defendants, who had taken steps to obey the injunction as soon as it was served on them" they were held liable for costs of a motion, apparently on the basis that they were absolutely responsible for their servant's act. In the Ready Mixed case, the company which was held liable for contempt had expressly prohibited the doing of the act complained of by its employees and had adopted reasonable compliance systems ([1995] 1 AC at 464C).

[25] So the law in England has developed in the direction of holding the blameless employer liable for unauthorised acts of an employee, in breach of an injunction. The qualification of this is that the employee must be shown to have acted "in the course of employment", in the sense in which that expression is used in the law of tort. Under the law of tort an employer may be held liable for his servants' acts, although clearly unauthorised: Deatons Pty Ltd v Flew [1949] HCA 60; (1949) 79 CLR 370 at 381, 384, 385, Morris v C W Martin & Sons Ltd [1966] 1 QB 716 at 740, 741; that is so even if the unauthorised act is done purely for the servant's own purposes: Lloyd v Grace Smith & Co [1912] UKHL 1; [1912] AC 716. That is the difference between an act done "in the course of employment" and one which is actually authorised; an employee's act may be in the course of employment although unauthorised, for example because forbidden. Sometimes there is a confusion of terminology, as in Heatons Transport (St Helens) Ltd v Transport and General Workers' Union [1973] AC 15, where the House of Lords used the expression "within the scope of the authority", apparently meaning or including "within the course of employment" (at 99C-D). A similar usage is to be found in Bugge v Brown [1919] HCA 5; (1919) 26 CLR 110 at 116, in the paragraph beginning "1. The Law".

[26] Vicarious liability for contempt is an important matter, since all contempt proceedings must realistically be seen as criminal in nature and require proof beyond reasonable doubt: Witham v Holloway (1995) 183 CLR 525 at 534. An employer should not, one would expect, ordinarily be held liable in proceedings which are of that kind, on the basis of actions of an employee which have been forbidden; particularly is that so when one considers that even a finding of contempt against an employer may do serious damage, leaving aside the prospect of punishment such as fines or imprisonment.

[27] My conclusion is, as will appear, that the English doctrine of strict vicarious liability to which I refer should not be followed, in this country. The proper rule is that the employer must be shown to have authorised the act complained of or shown not to have taken proper steps to prevent it. In the present case, the judge held the CFMEU liable on the "course of employment" test and that in my respectful opinion was not the proper test.

[28] This issue appears never to have been touched on in the High Court, except in AMIEU v Mudginberri Station Pty Ltd [1986] HCA 46; (1986) 161 CLR 98. That case, however, was not about liability, but only about the type of relief which was appropriate: see the argument of Mr Gleeson QC (as his Honour then was) at 100, 101, and see also 105. If the Mudginberri decision in the High Court had been about the question of vicarious liability, its application to courts other than the Federal Court would still be doubtful. That court, in punishing contempts, has to act on the basis of the power and authority of the Supreme Court of Judicature in England in 1903: AMIEU v Mudginberri Station Pty Ltd (No 2) (1985) 9 FCR 194 at 200.

[29] I am of the view that the High Court's mention of the Stancomb decision in Mudginberri ((1986) [1986] HCA 46; 161 CLR 98 at 112) with approval must have been intended to relate to the issue of the propriety of the relief granted, which is what the appeal was about, rather than to resolve the issue of the union's liability in contempt for acts of its officers, which was not in dispute.

[30] Looking at the doctrine developed in England from the Australian perspective, on the basis that what is involved is a criminal or quasi-criminal proceeding, the result arrived at there is unattractive, insofar as it can make an absolutely blameless person vicariously liable for the unauthorised act of an employee; vicarious liability for criminal acts is the exception, not the rule. The English courts have it appears regarded the presence of the word "wilfully" in a rule of court as relevant to the scope of vicarious liability, although the removal of that word from the relevant rule has made no difference: see Heatons (108G to 110B). To ascribe to the presence of the word "wilfully" in a rule of court the effect of making a blameless person liable for contempt is a surprising interpretation.

[31] In Queensland the corresponding rule was at the relevant time O 47 r 30; see now UCPR r 898, r 900. Rather similar provision is made by s 184 of the Supreme Court Act 1995, taken from s 56 of the Interdict Act 1867. The absence of the word "wilfully" from our corresponding rule is perhaps not a good reason for declining to apply the English authorities, for how can the deletion of the word "wilfully" have made the strict liability which it was said to produce any more strict? Nevertheless, it does not appear to me that the proper course is to treat the Ready Mixed case as generally applicable, in this country, to proof of contempt; that decision should be regarded as dependent upon the interpretation of the undertaking and statute there in question: see Meridian Global Funds Management Asia Ltd v Securities Commission [1995] UKPC 5; [1995] 2 AC 500 at 508G.

[32] In Z Bank v D1 and Ors [1994] 1 Lloyds LR 656 at 660, 661, it was held that disobedience of an injunction constitutes a contempt if the breach is done by a person acting within authority or if the party enjoined has not "taken all possible steps to prevent breach ..."; presumably "possible" means "reasonably possible". Approaching the matter on the basis that some element corresponding to what the criminal law calls mens rea must be shown (see per Lord Denning MR in Heatons at 50), there is room for a finding of liability even if the employer does not intend to break the law:

"[A] man, who actually realises what must be, or very probably will be, the consequence of what he does, does it intending that consequence."

per Windeyer J in Vallance [1961] HCA 42; (1961) 108 CLR 56 at 82. So the employer who has not taken proper steps to ensure that the injunction or undertaking is observed may be liable on that basis.

[33] But the learned primary judge held the CFMEU liable because what Spinks did was in the course of his employment; there was no finding that it was actually authorised, nor was such a finding open, on the evidence. The question remains whether the judge's conclusion can be and should be upheld by a different path.

[34] His Honour came to the conclusion, in considering the case against Trohear, the secretary of the union, that he had failed to take proper steps to ensure compliance with the undertaking. The evidence on which his Honour based that conclusion appears to me, with respect, sufficiently to support it. Trohear is not the union, so the question is whether his neglect can be attributed to the union. In my opinion that can be done under the doctrine that in some instances the law will test a corporation's liability on the basis of acts of certain senior officers, so that their acts are treated as its acts: Tesco Supermarkets Ltd v Nattrass [1971] UKHL 1; [1972] AC 153, Universal Telecasters (Qld) Ltd v Guthrie [1978] FCA 9; (1978) 18 ALR 531 at 535, 540, 541, 551 and 552. This, according to Lord Denning in Heatons, applies to cases of the present kind: [1973] AC at p 51. Under the Tesco principle, the union is liable for what its secretary Trohear did.

[35] The result is not entirely satisfactory in one sense: there is room for argument as to whether it is right to hold the union guilty of contempt on a factual basis different from that used against it at trial. It appears to me, however, that on the evidence and findings the legal principles which should be applied make the conclusion at which the learned primary judge arrived a correct one.

[36] As to Trohear, he was a party to the undertaking and the same reasoning applies, but more simply, to him: he personally was obliged to obey the undertaking, and so had an obligation to do everything reasonably necessary to achieve that end.

[37] On the other issues in the CFMEU case, I express my general agreement with the reasoning of Williams J.

(a) To show that a corporation is liable in contempt for breach of an injunction or undertaking, it is necessary to prove that the act or omission constituting the breach had its authority, or that it failed to take all reasonable steps to ensure that the obligation was carried out.

(b) It is not enough merely to show that an infringing act was done by an employee without authority, although in the course of employment.

(c) Because the union, by its secretary Trohear, did not take all reasonable steps to ensure that the undertaking was complied with, it was properly held liable in contempt.

(d) Because Trohear did not take such steps himself, he was also properly held liable.

[38] I agree that the appeal should be dismissed with costs.

[39] WILLIAMS J: Though separate issues were raised in each, these appeals were heard together. The common feature was that each involved a finding by the learned trial judge that an industrial union and its officers had breached an undertaking given to the Court not to interfere with employment contracts to which the respondent, Evenco Pty Ltd, was a party. In consequence it will be necessary in these reasons to deal separately with the issues raised, but repetition will be avoided wherever possible.

[40] Counsel for each appellant limited oral argument to but a few of the grounds of appeal taken, but each specifically said that all grounds of appeal were relied on and none were abandoned. That makes the task of this Court more difficult; however, all grounds of appeal will be addressed.

[41] The appellant in Appeal No 3610 of 1999 has changed its name since the commencement of the relevant proceedings; in the judgment appealed from and in argument it was referred to as the CFMEU, and it is convenient to so refer to it throughout these reasons. Similarly, the first appellant in Appeal No 3536 of 1999 has been referred to throughout as the BLF and again it is convenient to follow that course in these reasons. The respondent in each case will simply be referred to as Evenco.

[42] The points which counsel for the CFMEU elaborated on in oral argument were:

(i) the organiser, Spinks, was acting without the authority of the CFMEU or the second appellant Trohear in doing the acts and making the statements which were held to constitute the contempt;

(ii) the learned trial judge was not justified on the evidence in being satisfied beyond reasonable doubt that the acts and words alleged to constitute the contempt were proved;

(iii) the learned trial judge took irrelevant considerations into account in determining the fine to be imposed on the appellant Trohear.

[43] So far as the BLF appeal is concerned, counsel for the appellants addressed oral argument to the following matters:

(i) the learned trial judge erred in his construction of the word "lawful" where it was used in the undertaking in question;

(ii) the learned trial judge erred in his construction of the undertaking in question in not finding that it was ambiguous and therefore unenforceable.

[44] In May 1988 there was an action pending in this Court between Evenco as plaintiff and the BLF as defendant in which the plaintiff claimed damages for and an injunction restraining the BLF from interfering with its contractual relationships. That action was settled upon terms which included the BLF giving the following undertaking to the court on 17 May 1988:

"To refrain from doing ... any act having the object of directly or indirectly preventing or hindering the servants or agents of the plaintiff ... or such building construction workers as the plaintiff may assign from time to time from entering upon any building site situated in Queensland and from carrying out their lawful employment thereon, provided that the principal contractor on such site has been notified thereof and has made no objection thereto."

[45] In the current proceeding Evenco alleged and it was found that the BLF breached that undertaking in three instances. The imposition of a fine was submitted to be the appropriate penalty for that contempt and a fine was imposed; $20,000 for each of the three breaches.

[46] It was asserted on behalf of the BLF both at first instance and on appeal that the inclusion of the term "lawful" rendered the undertaking of uncertain meaning. Firstly, it was said that one would require such legal knowledge as would allow an opinion to be expressed upon the lawfulness of the agreements before one would know what particular conduct was proscribed by the undertaking. Secondly, it was said that the reference to "lawful employment" could refer either to agreements to employ which were in existence and lawful at the time when the undertaking was given, or to such agreements made subsequently. Because there was more than one possible construction there was ambiguity.

[47] The term "lawful" also occurred in the undertaking given by the CFMEU and the point was also taken by that appellant in written submissions. It was there contended that it was not possible simply by reading the undertaking to know whether any agreement was lawful and the appellants would be required to take legal advice to know whether or not particular conduct would breach the undertaking.

[48] On this issue both the judge at first instance and counsel for the appellants referred to the decision of McPherson J in The Commissioner of Water Resources v Federated Engine Drivers' and Firemen's Association of Australasia Queensland Branch [1988] 2 Qd R 385. There it was alleged that the defendant union had breached an order of the court restraining it "from procuring a breach by White Industries (Qld) Pty Ltd of the contract between the The Commissioner of Water Resources and White Industries (Qld) Pty Ltd ... by refusing to work at the construction site ... in accordance with their contracts of employment with White Industries (Qld) Pty Ltd ...". That judgment at 390 is but another illustration of the application of the principle that a person cannot be held guilty of contempt for breaking the terms of an undertaking unless its terms are clear; the undertaking must leave the promisor in no doubt what it is that must be done or must not be done in order to comply with its obligations thereunder. That leads to the subsidiary proposition that a person cannot be committed for contempt on the ground that one of two possible constructions of the undertaking has been broken.

The appellants here relied on a particular passage in the judgment of McPherson J at 390 where he said:

"In its present form the injunction ... restrains the respondents from procuring a breach by the company of its contract with the applicant. In order to comply with the injunction, it would in consequence be necessary for the respondents to refer to the terms of the contract, which is not in their possession, and no doubt also to take legal advice, in order to determine whether, by refusing to work in accordance with their own contracts of employment, they were procuring a breach of the company's contract with the applicant. That is quite contrary to another well settled rule governing injunctions, which is that the order should be so expressed that the person to whom it is directed should be able, by reading it and without more, at once to know what it is that he must do, or refrain from doing, in order to comply with its terms."

[50] The appropriateness of that observation with respect to the undertaking in that case is not in issue here. What Evenco says is that such observation is not relevant here given the terms of these undertakings. The learned trial judge was correct in drawing the distinction between an injunction restraining "procuring a breach ... of ... contract" - the situation in The Commissioner of Water Resources - and an undertaking proscribing "conduct of a defined sort" - the position here. The undertaking given by the BLF required it to refrain from doing acts having a defined object. There was, prima facie, no difficulty in identifying what was proscribed from a reading of the undertaking itself.

[51] Counsel for the appellants highlighted in submissions the conclusion reached by the learned trial judge that the term "lawful" in the context of the undertaking meant "no more than normal or ordinary". I cannot accept that conclusion. Something is lawful if it is not forbidden by law or is supported by the law or may be enforceable at law. But that conclusion reached by the learned trial judge does not vitiate his overall reasoning.

[52] The word "lawful" really adds nothing to the undertaking in this case. If on the hearing of a contempt proceeding there was any suggestion that the employment interfered with by the conduct in question was in any way unlawful, then the court would require the lawfulness of the employment to be positively established before finding the contempt proved, whether or not the term "lawful" was expressly used in the undertaking; the court would not by finding contempt impliedly give its imprimatur to something which was illegal. Here, there was nothing in the evidence to suggest that the employment interfered with was other than lawful employment. At no time did the BLF or its officers have any reason to doubt the lawfulness of the employment to which their conduct, found to be in breach of the undertaking, was directed.

[53] The inclusion of the term "lawful" in the undertaking given by the BLF did not make it unclear what it was it could not do in consequence of the undertaking.

[54] On the proper construction of the undertaking it applied both to employment agreements in existence at the date the undertaking was given and to future employment agreements. It is not uncommon for injunctions and undertakings to relate to future events and it is clear that future employment contracts were in the contemplation of the BLF at the time it gave the undertaking. That was well known to its officers as the evidence demonstrates.

[55] The more substantial submission with respect to the construction of the BLF undertaking related to the effect of the proviso; it was said that there was ambiguity as to its operation. The BLF contended that what the principal contractor must be notified of and make no objection to could be:

(i) the conduct of the union organisers hindering the construction workers;

(ii) the fact that Evenco was assigning workers to the site;

[56] There was no evidence in this case that the contractors in question were notified of and did not object to the conduct in question of the BLF organisers. It was then said by counsel for the BLF that in consequence Evenco had not proved its case beyond reasonable doubt because it had only shown contempt on one of the possible constructions of the undertaking.

[57] The learned trial judge rejected that submission; essentially he held that upon the proper construction of the undertaking all that was required was that Evenco should notify the principal that it was assigning workers to the site. The learned trial judge reasoned in this way:

"The plaintiff's answer is that, as a matter of grammar and of commonsense, the proviso does not refer to union activity preventing or hindering workers entering upon or carrying out their employment, but to the workers entry onto sites and performance of their employment. That is to say the plaintiffs construction of the undertaking is that the union may not prevent or hinder workers assigned by the plaintiff from entering on a building site or performing work on the site provided the principal contractor to the site knows of their engagement and does not object to it.

I prefer the plaintiff's construction. It has the consequence that where the principal contractor is informed that the plaintiff has provided workers to the site and does not object to their presence, the BLF may not prevent or hinder their attending at the site or working. The union's construction has the consequence that it may prevent or hinder the plaintiffs workers from entering or working on a site only when the principal contractor has been told and not objected to the acts constituting prevention or hindrance. In cases such as the three in question, where the principal contractor itself engaged the plaintiff to provide labour to its site, the union's construction is unintelligible. The undertaking would only operate in a circumstance which ex hypothesis it would not be allowed to operate because the principal contractor wanted the plaintiff's labourer on site.

Further it is not easy to see how the principal contractor could be notified and not object to acts of prevention and hindrance in advance of their occurrence. Yet if the unions construction be correct that would be required."

[58] That reasoning would appear to be correct. As was said by Priestley and Clarke JJA in S & M Motor Repairs Pty Ltd v Caltex Oil (Australia) Pty Ltd (1998) 12 NSWLR 358 at 387, an undertaking must be construed "in the factual matrix which was known to both parties." Here the undertaking was given as part of the settlement of an action Evenco had commenced against the BLF claiming relief because, through intimidation, the BLF was interfering with the contractual arrangements it had with workers. In that context it is improbable (very highly unlikely) that Evenco would have accepted an undertaking which permitted the BLF to interfere with such contracts provided the principal contractor did not object. The obvious construction is that which was preferred by the learned trial judge. An undertaking does not fall foul of the principle that its terms must be clear and ascertainable on its face simply because someone can contend for an unlikely construction thereof. In that context the learned trial judge referred to and relied on a passage from a judgment of Barwick CJ in Australian Consolidated Press Ltd v Morgan [1965] HCA 21; (1965) 112 CLR 483 at 492:

"But, if it bears a meaning which the Court is satisfied is one which ought fairly to have been in the contemplation of the person to whom the order was directed or who gave the undertaking as a possible meaning, the fact that that meaning results from a process of construction and involves a choice of possible meanings does not, in my opinion, preclude the Court from enforcing the order or undertaking in the sense which the Court assigns to it."

[59] Counsel for the BLF submitted that the learned trial judge erred in relying on that passage because Barwick CJ dissented in the result in that case. Though he agreed with Owen J to constitute a majority with respect to the end result of the case, Windeyer J appears to have agreed with Barwick CJ on the specific point in issue; at 503 he said:

"This is not a case in which the extent of obligations undertaken is ascertainable simply by construing the undertaking according to ordinary grammatical rules. If that were so, I would agree that a mistake in construction could not excuse disobedience, although it might perhaps mitigate its consequences. Those who give undertakings to a Court are bound by the language they use. If its true meaning, although not immediately plain, can be ascertained according to ordinary rules of construction, then the person giving the undertaking is bound by it in that sense."

[60] Here, the true meaning is readily ascertainable by applying ordinary principles of construction, and that meaning is confirmed by a consideration of the matrix of facts in which it was given. That is then the meaning which the BLF and its organisers are taken to have conveyed when they proffered the undertaking and they are bound by it in those terms. That meaning is so obvious it must have been in the contemplation of the BLF at the time the undertaking was given.

[61] The learned trial judge was correct in concluding that there was no such ambiguity about the undertaking as would render it unenforceable.

[62] I now turn to consider the grounds of appeal taken by the BLF which were not abandoned but not made the subject of oral submissions.

[63] Ground 2(d) alleged that the learned trial judge erred in finding that Evenco had proved its case in respect of each of the three matters beyond reasonable doubt. There is absolutely no substance in that contention. A perusal of the reasons makes it abundantly clear that at all times the learned trial judge was conscious of the fact that proof beyond reasonable doubt was required, and his reasoning amply demonstrates that he was satisfied to the requisite degree.

[64] Specifically, the BLF contended that the learned trial judge could not have been satisfied with respect to the Everton Park Shopping Centre matter, because he "in fact did have a doubt [as] is apparent from his own reasons at paragraph 131". On this part of the case it was essentially word against word as his Honour recognised in that paragraph. Here that the BLF's case was dependent upon the witness Steele. The learned trial judge said "There is nothing in Mr Steele's evidence which itself suggests that it is unreliable." But he went on to say that he preferred the contrary evidence of Mr Gersekowski, partly at least because he had made a contemporaneous diary entry as to the relevant conversation. In those circumstances the learned trial judge made a credibility finding against the witness relied on by the BLF and that entitled him to be satisfied beyond reasonable doubt that the relevant conduct had been proved.

[65] Further, in relation to the Logan Hyperdome and Carlton Crest matters it was contended that the learned trial judge erred in fact and in law and not accepting the evidence of Whysall. Again this was clearly an issue of credibility and fact primarily for determination by the trial judge. It is obvious from a consideration of the reasons that again he had in the forefront of his mind that proof beyond reasonable doubt was required. There is no reason for interfering with his conclusion.

[66] The final ground of appeal alleged that the learned trial judge erred in imposing fines which were manifestly excessive and in ordering, in the exercise of his discretion, the appellants to pay costs on a solicitor and own client basis. In each instance the learned trial judge was exercising a discretion and the appellants have not pointed to any recognised ground for interfering with its exercise. The learned trial judge considered the contempt to be a serious and deliberate breach of an undertaking given to a court which was not to be regarded lightly. In the circumstances I can see no basis for interfering either with the quantum of the fines or the order made for costs.

[67] In 1986 Evenco sued the CFMEU for damages, including exemplary damages, for intimidation and interference with its contractual relationships. The action was settled in March 1987, on terms which included the following undertaking which was recorded in an order of the court:

"Upon [CFMEU and William Wallace Trohear] and each of them by themselves their servants and agents undertaking to refrain from any act or omission, having the object:-

(a) Of directly impeding the performance of, or procuring the breach of, or otherwise interfering with, any lawful agreement between the plaintiff and any other person, (being a natural person, firm or body corporate) for the supply by the Plaintiff of labour on hire to such other person; and/or

(b) Of directly or indirectly preventing the making of any lawful agreement for hire of labour between the Plaintiff and such other person; and/or

(c) Of directly or indirectly preventing or hindering the lawful supply by the plaintiff by labour on hire to such other person."

[68] The CFMEU raised an issue with respect to the use of the term "lawful" along the same lines as that raised by the BLF with respect to its undertaking. Counsel for the CFMEU on the hearing of the appeal did not elaborate on the written submissions in this regard; he relied on what had been said by counsel for the BLF.

[69] That contention must be rejected for the reasons given above with respect to the appeal by the BLF. The inclusion of the terms "lawful agreement" and "lawful supply" did not render the meaning of the undertaking uncertain.

[70] Further, with regard to the construction of the undertaking it was asserted in written submissions that the terms were not formulated sufficiently, precisely "to admit of its ready or convenient enforcement". There was no elaboration of that contention. In the circumstances, particularly adopting the approach of Barwick CJ and Windeyer J in Australian Consolidated Press Ltd v Morgan, I am satisfied that the true meaning was readily ascertainable according to ordinary rules of construction and the CFMEU was bound by it in that sense.

[71] It was also contended in the written outline that the terms "impeding the performance of", "procuring the breach of" and "preventing the making of any lawful agreement" were so wide and uncertain as to render the undertaking unenforceable. In that regard in his reasons for judgment the learned trial judge focused on the expression "any act or omission, having the object ... of". In his view, correctly in my opinion, only conduct having one of the specified objects constituted a breach of the undertaking. That had the consequence of narrowing considerably the scope of conduct which would constitute a breach. Particularly when read in that light, I am of the view that the undertaking was not couched in such wide and uncertain language as to be unenforceable.

[72] Next, in accordance with the written outline, it was contended that the use of the terms "and/or" created ambiguity and the learned trial judge erred in law in not so finding. It is true that in Commissioner of Water Resources at 391 McPherson J expressed the view that "the words 'and/or' ... I consider, [are] always likely to be objectionable in an order sought to be enforced, as is this, by attachment." But the expression is frequently found in legal documents, and as the learned trial judge pointed out it will not always result in ambiguity. Each case must be considered on its own facts. There is no ambiguity here; one or more of the three specified acts will constitute a breach of the undertaking.

[73] Then it was contended in the written submissions that the learned trial judge erred in law in failing to construe the term "any lawful agreement" in the undertaking as a reference to agreements in existence at the time the undertaking was given, or, alternatively, in failing to decide that the term created ambiguity. Counsel for the respondent pointed out that the learned trial judge's conclusion was based only on the third limb of the undertaking which did not use the words in question. That in itself would be a sufficient answer to this submission. But, in my view, on its proper construction the meaning was clear; it applied to both existing and future contracts. That was well known to Trohear, as his evidence amply demonstrates. It is not uncommon for injunctions and undertakings to relate to future conduct and it is clear, particularly when this undertaking is construed against the background matrix of relevant facts, that future as well as existing contract were in the contemplation of the CFMEU at the time it gave the undertaking.

[74] I turn now to the matters which were the subject of oral submissions by counsel on behalf of the CFMEU. It is convenient to deal first with the submission that the learned trial judge was not justified on the evidence in being satisfied beyond reasonable doubt that the acts and words alleged to constitute the contempt were proved.

[75] Throughout the judgment the learned trial judge made frequent reference to the fact that proof beyond reasonable doubt was required, and the stress that was placed on that proposition during addresses. There is no doubt that at all times he was conscious of the onus which Evenco had to discharge.

[76] His finding was that the CFMEU and Trohear breached the undertaking because of the conduct of the organiser, Spinks, on 21 May 1997 at Southport. Concrete Constructions Pty Ltd was the head contractor working on the Southport District and Magistrates Courts project. Sarcon Building Services was the sub-contractor performing plaster rendering; Sarri was its principal on site. A labourer named Price had been engaged by Sarcon through Evenco. It was not disputed that consequent upon events which occurred on 21 May, the hiring of Price was transferred from Evenco to Australian Trades & Labour Hire; in accordance with the findings made by the learned trial judge that transfer appears to have occurred about 2 pm on that day.

[77] The real issue was as to the reason for that transfer being effected. The matter was complicated by the fact that a Mr Perrott, a representative of the Building Employees Redundancy Trust (BERT) was also present on site on that day and was also concerned with the relationship between Price, Evenco, Sarcon and BERT. One possible view of events was that Perrott was concerned that Evenco was not making a contribution to BERT with respect to Price. On that possible view, Perrott raised that concern with Sarri and that resulted in the transfer; the other hire company apparently made contributions to BERT.

[78] The other interpretation of events was that Spinks complained to Sarri that there was a person on site employed by Evenco who did not have an agreement with the union. In broad terms on that scenario, Sarri arranged the transfer of the hire in order to avoid trouble in the CFMEU.

[79] There is no dispute that there was a deal of inconsistency in the evidence of Perrott, Price, Spinks, Sarri and Trohear in relation to the events in question. The learned trial judge made a careful and detailed analysis of the evidence, including the significant inconsistencies. At the end of the day he concluded that he was satisfied beyond reasonable doubt that it was the conduct of Spinks in complaining to Sarri about Evenco being the employer of Price, which resulted in the transfer of the hiring agreement. He accepted that Spinks told Sarri that he (Sarri) had a problem on site because he was using "labour from a company called Evenco who didn't have an agreement with" the CFMEU. Further he accepted that Spinks also said to Sarri he "couldn't use them on this site and you should ... get them off the site." It is that conclusion which the CFMEU challenges.

[80] Much of the appellant's argument concentrated on Exhibit 26, the diary of Spinks for 21 May, and Exhibit 27, a print out of calls made by Spinks on his mobile phone.

[81] No witness could explain how or why, but according to his evidence Trohear became aware in the early afternoon of 21 May that something had occurred at the site in question which might create trouble because of the undertaking in place. According to the evidence of Trohear and Spinks words were exchanged about that and the former advised the latter to contact Sarri again and explain the position. The evidence of Spinks is that he telephoned Sarri again that afternoon; Exhibit 27 at least confirms that a call was made from Spinks' mobile phone to Sari's mobile phone at 3.45 pm on that day and lasted for two minutes 41 seconds. The following entry then appears in the diary against the time 4pm:

"Rang Lou Sari Sarcon told him to use which contractor he chooses as long as workers get paid right award rate Lou was happy with that but has changed to Aust Trades and they pay right and just wants to do the right thing as far as possible."

[82] Towards the end of his careful analysis of the relevant evidence the learned trial judge observed:

"The diary entry has the appearance of an invention, the necessity for which appeared with the commencement of contempt proceedings."

[83] It is sufficient to say that all relevant findings are justified on the analysis made by the learned trial judge of the evidence. Further, as he pointed out, the telephone account merely establishes a telephone call between the two phones; it does not prove a conversation in the terms alleged by Spinks.

[84] Counsel for the appellant relied on the approach of the High Court in State Rail Authority of New South Wales v Earthline Constructions Pty Ltd [1999] HCA 3; (1999) 73 ALJR 306, and contended that the findings of the learned trial judge were in conflict with unchallenged documentary evidence. He also contended that the findings of the learned trial judge were not put to the witnesses called by the CFMEU in crossexamination. In the end, I have come to the conclusion that there is no substance in those submissions. The cross-examination clearly raised the accuracy of the diary note in question, and whether or not a second phone call had been made by Spinks to Sarri that day as the former alleged. Further, the documents were in the circumstances of little weight without the acceptance of the evidence of Spinks. It was clearly a situation to be distinguished from that which existed in Earthline.

[85] As the learned trial judge himself recognised this was a situation which called for a detailed analysis of conflicting evidence and an assessment of credibility. There is no reason why in such circumstances a proper analysis of the evidence may not lead to findings of fact beyond reasonable doubt. Here the careful and detailed analysis by the learned trial judge, including the making of findings on credibility, led to his being satisfied beyond reasonable doubt that it was the conduct of Spinks which led to the hire agreement between Evenco, Price and Sarcon being terminated and an agreement with another company substituted for it. That would constitute a breach of the undertaking provided the CFMEU and Trohear were legally liable for the conduct of Spinks. That is the next question which must be addressed.

[86] The learned trial judge considered that the question whether Spinks was acting in the course of his employment was central to the determination of the question whether the CFMEU and/or Trohear was liable for his conduct. That approach was challenged by counsel for the CFMEU who contended that the question whether a union was liable for the acts of one of its organisers was dependent upon evidence establishing that the conduct was within authority; on that approach the "scope of authority" test determined the liability of a union for the acts of its officers.

[87] In this case an order had been made directing the parties to exchange pleadings. In its amended defence delivered 2 March 1999 the CFMEU admitted that in or about May 1997 Spinks was employed by it as an organiser. In consequence the hearing was conducted on the basis that at the material time Spinks was a paid union official, an employee.

[88] In the reasons for judgment the learned trial judge said that an organiser "was to argue and remonstrate with employers and contractors to secure what he was instructed were the appropriate terms and conditions for building workers who were or might become members of the CFMEU." On the appeal the accuracy of that assertion was questioned. Five of the witnesses called in the CFMEU case (Logue, Spinks, Trohear, Perrott, and Wigchert) were then, or had been at some time, union organisers or persons responsible for the conduct of union organisers. Wigchert was responsible for training organisers. A perusal of all their evidence gives a broad overview of the type of activity generally considered to be part of an organiser's job. A consideration of that evidence, and other documentary evidence (including the union rules) makes it clear that an organiser's duties include the following: checking union membership on site; ensuring union members are financial; explaining advantages in union membership; dealing with employers and employees; dealing with industrial disputes; arranging meetings of members on site; ensuring compliance with industrial agreements; checking wages and conditions under which workers are employed; increasing employment on site; checking safety issues and raising such issues with management; ensuring members receive all entitlements; checking employers make all necessary contributions to funds for workers; checking hours of work of members. Against all that background it can be seen that the statement formulated by the learned trial judge is generally a noncontentious overall description of the role of an organiser.

[89] It is clear from all the evidence that an organiser does not have to obtain express authority from union management before entering upon a work site for any of the purposes referred to above. An organiser, such as Spinks, has authority from the CFMEU by virtue of his employment to do all or any of those things. Specifically, so far as this case is concerned, that would include ensuring that workers held appropriate union membership and that with respect to all workers payments to schemes such as BERT were being made by employers.

[90] Counsel for the CFMEU contended that as Price was in fact a member of the BLF and not the CFMEU, and further being a labourer could not become a member of the CFMEU, Spinks acted outside his authority in approaching Sarcon about the position of Price. That is a matter to which I will return in a moment.

[91] Finally, before referring to the authorities Rule A24 should be noted; the relevant paragraphs thereof are as follows:

"The Divisional Branch Management Council shall not less than two months prior to the closing of nominations as prescribed in Divisional Branch Rule A27, determine the number of organisers to be elected. They shall also determine the area of the State in which organisers shall reside and operate, and may if income is sufficient appoint additional organisers.

The organisers shall be under the control of the Divisional Branch Management Committee and shall when required, attend meetings of the Divisional Branch Management Committee. They shall perform such organising duties as may be required and shall visit shops and jobs where members of the Divisional Branch and other workers eligible to join are employed and endeavour to enrol new members. They shall cooperate with all shop and job stewards and Sub-Branch Secretaries, and carry out organisational work in any part of the Divisional Branch as directed by the Divisional Branch Management Committee."

[92] In the context of union liability for contempt of court in breaching an undertaking given in an industrial context, it is important, in my view, to recognise the difference between on the one hand a paid union official (including an organiser), and on the other hand union members, shop stewards, and the like who, in an unpaid capacity, represent the union on certain issues. Industrial action usually involves acts by a significant number of "unionists" and the union body as such will not always be responsible in law for the conduct of all the unionists participating in the industrial action.

[93] Counsel for the CFMEU relied heavily on The Waterside Workers Federation of Australia v Burgess Brothers Limited [1916] HCA 2; (1916) 21 CLR 129. There Griffith CJ said at 134: "A person or a corporation is not in a Court of Justice held liable for the actions of others unless his or its authority to do the actions on his or her behalf is established by evidence." Barton J adopted a similar approach though he recognised (at 136) that such authority could be implied. In that case there was an endeavour to establish liability in the federal union body where the conduct in question was authorised by a branch which had autonomy, and where the strike was held without the knowledge of the governing body of the federal union. The remarks of Griffith CJ and Barton J must be read in that context.

[94] The comments of those two judges were referred to by Keely J in GTS Freight Management Pty Ltd v Transport Workers Union of Australia [1990] FCA 78; (1990) 25 FCR 296. In that case one Connors was an organiser of the respondent union who was subject to the control and direction of the Branch Committee of Management. He was not present when the strike in question began nor when the picket line started. The learned judge accepted that Connors was on the picket line at least on four days but he rejected evidence that Connors was then playing some organising role. The findings of fact appear to make it clear that the setting up and conduct of the picket line was not carried out by any servant of the union itself. Certainly members of the union, probably including local shop stewards, were responsible for organising the picket line and the question was whether or not the union organisation was thereby made liable. It was in that context that reference was made to Burgess Brothers; as there was no evidence establishing that the persons responsible for the organisation of the picket line had authority to bind the union the proceedings against the union were dismissed.

[95] It is clear that neither of those cases involved consideration of the liability of a trade union for the conduct of an employee doing the very sort of thing he was employed to do. There are, however, English and Australian authorities dealing with that very question.

[96] The best starting point is the decision of Warrington J in Stancomb v Trowbridge Urban District Council (1910) 2 Ch 190, a case referred to by the learned trial judge in his reasons. There the question was whether or not a corporation had committed a breach of an injunction so as to be liable for contempt. The following passage at 194 has been followed and approved by both the House of Lords and the High Court:

"In my opinion, further, the act need not be done by the person himself. In the case of a corporation it cannot be done by the corporation itself, at any rate in the case of such a corporation as an urban district council. Such a body can only act by its agents or servants; and I think, if the act is in fact done, it is no answer to say that, done, as it must be, by an officer or servant of the council, the council is not liable for it, even though it may have been done by the servant through carelessness, neglect, or even in dereliction of his duty."

[97] That judgment was referred to with approval by Lord Wilberforce in delivering the judgment of the House of Lords in Heatons Transport (St. Helens) Ltd v Transport and General Workers Union [1973] AC 15 at 109, a case concerning the liability of a union for conduct of shop stewards. At 1123 it was said:

"... consistently with its rules and practice, shop stewards of the union have a general implied authority to act in the interests of the members they represent and in particular to defend and improve their rates of pay and working conditions. They may do so by negotiation or by industrial action at the relevant place of work. They are not authorised to do any act outside union rules or policy."

[98] The shop stewards were agents not servants and against that background the observation of Lord Wilberforce at 110 is pertinent:

"To be effective in law a withdrawal or curtailment of an existing actual authority of an agent must be communicated by the principal to the agent in terms which the agent would reasonably understand as forbidding him to do that which he had reasonably been authorised to do on the principal's behalf. One is looking therefore for some communication to the shop stewards, by some officer or committee entitled to give them instructions on behalf of the union, couched in language which they would understand as being an order by the union to stop organising the blacking by members of the union of vehicles operated by the appellant companies."

[99] Factually his Lordship referred to a full time officer of the union attending a meeting and saying nothing to suggest that the union disapproved of the policy being advocated by the shop stewards. On the whole of the evidence it was held that there was evidence establishing that the union had not taken such, or any adequate, action to comply with the injunctions granted by the court. The union was responsible for the steps taken by its agents, the shop stewards.

[100] Those authorities were considered and approved by the High Court in AMIEU v Mudginberri Station Pty Ltd [1986] HCA 46; (1986) 161 CLR 98 especially at 1113. Referring to Stancomb the court said at 112: "Thus, it would suffice that the relevant act or omission was wilful even if, in case where the breach was constituted by an act or failure to act by a servant or agent, the act or omission of the servant or agent was through carelessness, neglect, or even dereliction of duty." The most recent relevant decision is that of the House of Lords in DirectorGeneral of Fair Trading v Pioneer Concrete (UK) Ltd [1995] 1 AC 456, another authority referred to by the learned trial judge. The following passages from the judgment delivered by Lord Nolan are relevant for present purposes:

"... a company, in its capacity as supplier of goods, like any person in the capacity of taxpayer, landlord or in any other capacity, falls to be judged by its actions and not by its language. An employee who acts for the company within the scope of his employment is the company. Directors may give instructions, top management may exhort, middle management may question and workers may listen attentively. But if a worker makes a defective product or a lower manager accepts or rejects an order, he is the company."(465)

"The view of Warrington J has thus acquired high authority. It is also the reasonable view, because the party in whose favour an order has been made is entitled to have it enforced, and also the effect of administration of justice normally requires some penalty for disobedience to an order of a court if the disobedience is more than casual or accidental or unintentional. ... Since Heatons' case was concerned with agents and not with servants the latter part of the relevant passage from the judgment of Warrington J in Stancomb's case was not in point, and it would have been inappropriate for Lord Wilberforce to refer to it. But if Lord Wilberforce had thought that it was erroneous, it is inconceivable that he should have failed to say so. The passage as a whole supported the proposition that disobedience by the servants of a company, acting in the course of their employment, to an injunction amounted to contempt of court by the employing company unless the conduct of the employees could be described as merely casual or accidental and unintentional, a qualification which clearly did not apply to the conduct of the employees in the present case." (479480)

[101] At all material times Spinks was an employee of the union and that in itself constitutes evidence indicating his authority. Rule A24 does not of itself impose any restriction on an organiser's authority to do the very things he is employed to do. The position of Spinks is distinguishable from that of an ordinary member of the union whose conduct would not bind the organisation unless done with express or implied authority.

[102] It was in the light of those authorities that the learned trial judge considered whether Spinks was acting in the course of his employment when he rang Sarri on 21 May 1997. In my view that was the correct test to apply given that Spinks was an employee of the CFMEU. The learned trial judge considered that at the relevant time Spinks was performing a function of a kind which he was employed to do. Given the whole of the evidence that would appear to be correct.

[103] In consequence the learned trial judge, applying the authorities to which reference has been made, went on to consider whether the conduct was merely casual or accidental or unintentional. Again he concluded that the actions of Spinks were not caught by those terms; he considered that Spinks deliberately communicated with Sarri intending to have the labourer in question removed from the site.

[104] In that regard it is relevant to consider the fact that Price was not a member of the CFMEU and was not entitled to be a member. At the material time he was working with plasterers who were members of that union and that is how the mistake came to be made. The learned trial judge concluded that Spinks "acted in the honest but mistaken belief that he was advancing the interests of a member of the CFMEU."

[105] What is important for present purposes is what Spinks did, rather than what he may have believed he was doing. The bottom line is that Spinks, acting as organiser of the CFMEU, told Sarri that he could not continue to use Price as a labourer on the site. In the circumstances that conduct amounted to a breach of the undertaking and it was deliberate conduct by an employee of the CFMEU acting as such. That conduct could not be described as casual, accidental or unintentional.

[106] The management of the CFMEU clearly understood that organisers were, if called upon to deal with Evenco, likely to breach the undertaking. For that reason steps were taken in the years immediately after the undertaking was given to ensure that organisers did not deal with Evenco, but referred any problem with that organisation to the State secretary. It was regarded as sufficiently important to have Wigchert include in his training program a direction to organisers that all problems with Evenco should be referred to the State secretary. Notwithstanding some incidents in 1994 which resulted in correspondence between Evenco and Trohear suggesting a possible breach of the undertaking, Wigchert concluded in about 1995 that it was no longer necessary to refer to the Evenco undertaking in the course of his training program. In consequence Spinks was never made aware of the existence of the undertaking. The union cannot avoid liability by relying on its failure to make its appropriate employees aware of the undertaking. It is clear that the union realised that it was its organisers who were most likely to be in a position of breaching the undertaking and in consequence there was a continuing obligation on the union to make those employees aware of the terms of it. The passage in Heatons Transport at 110 is apposite; the union was obliged to instruct its organisers that action, otherwise within their duties as an organiser, could not be taken where Evenco was involved.

[107] In all the circumstances I have come to the conclusion that the learned trial judge applied the correct test and also was correct in holding on the evidence that the CFMEU was liable for the conduct of Spinks.

[108] If, however, the correct test be that the act must be done with the authority of the corporation I would agree with Pincus JA that the evidence would not support such a finding. In that situation I would concur with Pincus JA in holding that because the union, by its secretary Trohear, did not take all reasonable steps to ensure that the undertaking was complied with, it was properly held to be in contempt.

[109] Finally, it was submitted that the fines imposed on the CFMEU and Trohear ($20,000 and $5,000 respectively) were manifestly excessive.

[110] Though this was the first breach in some 12 years since the undertaking was given the learned trial judge correctly regarded the breach as serious. On his findings the union had not taken all reasonable steps to ensure that its organisers were aware of the undertaking and the obligations it created.

[111] Trohear was a party to the original action and also gave the undertaking which was breached by Spinks. The learned trial judge concluded that Trohear, as secretary of the union and its chief executive, was in a position analogous to that of a company director. He referred to the Rules of the CFMEU in arriving at that conclusion. Reference in that context was also made to AttorneyGeneral for Tuvalu v Philatelic Distribution Corporation (1990) 1 WLR 926 at 938.

[112] The learned trial judge found that Trohear failed to take continuing steps to ensure that those to whom he delegated the handling of matters which fell within the scope of the undertaking had not forgotten or misunderstood or overlooked the obligations imposed upon them. Trohear instructed Wigchert to include reference to Evenco in the training program initially, but took no steps to ensure that such instruction continued.

[113] All of that led the learned trial judge to conclude that there had been a failure on Trohear's part to supervise the affairs of the union and its personnel in order to ensure compliance with the undertaking. Again that was a conclusion which was open on the evidence and it cannot be said that the learned trial judge erred in so concluding.

[114] It was submitted by counsel for the CFMEU that the learned trial judge took an irrelevant consideration into account in determining the quantum of the fines, namely that it "became apparent during Mr Trohear's evidence that the CFMEU regards the plaintiff with hostility." One cannot say that such a conclusion was not justified. The trial judge saw the witness in question and if that was the impression he gained he was entitled to act on it.

[115] In all the circumstances I cannot conclude that the fines were manifestly excessive.

[116] A challenge was also made to the order for costs, but as with the BLF there is no ground for interfering with the exercise of discretion in that way. Orders for costs on a solicitor and client basis have been made in similar situations and it cannot be said that it was wrong to make such an order here.

[117] It follows that each of the appeals should be dismissed with costs.

[1] Halsbury's Laws of Australia, 5, para [105-290].

[2] [1990] ATPR 41-013, 51, 247.

[3] [1965] 2 All ER 1003, 1009.

[4] [1973] AC 15, 110BC, 113C.

[5] [1987] FCA 117; (1987) 72 ALR 415, 423.

[6] [1994] 1 Lloyd's Rep 656, 661.

[7] See Worthington v Ad-lib Club Ltd [1965] 1 Ch 236, 248.

[8] See Madiera v Roggette Pty Ltd [1990] 2 QdR 357, 364.

[9] Australian Consolidated Press v Morgan [1965] HCA 21; (1965) 112 CLR 483, 498-9; McIntyre v Perkes (1987) 15 NSWLR 417, 427-428, 436.

[10] McIntyre v Perkes 427, 432; Latoudis v Casey [1990] HCA 59; (1990) 170 CLR 534 deals with the correct principles for awarding costs against unsuccessful prosecutors in the Magistrates Court; it has no application to an order for costs against an entity found guilty of contempt.

[11] For example, the penalty and costs order for a proven breach of a court undertaking in an industrial context were considered contemporaneously by Lehane J in Real Tech Systems Integration Pty Ltd & Anor v Meuross & Anor [1997] FCA 1263 (21 November 1997) and by Drummond J in Australian Competition & Consumer Commission v Goldstar Corp Pty Ltd [1998] FCA 1441 (6 November 1998).

[12] House v The King (1936) 55 CLR 499, 507-508.