KIEFEL J:
98 The background to and history of this matter are dealt with in detail in the judgment of Wilcox and Marshall JJ. In March 2001 disputes arose as to the means by which changes could be made to the rules concerning the elections of officers of the Construction & General Division ("the Division") of the Construction, Forestry, Mining and Energy Union. A decision of the Divisional Executive, on a proposal to alter the rules to allow elections to be held earlier in the year, was obtained by postal ballot. The applicants contended this was not a course which was open and that the Divisional Conference was obliged to review that decision following a request made by Mr Kingham, a member of the Divisional Executive and Secretary of Victorian Building Unions Divisional Branch. At about the same time as these events took place four Divisional Branches advised Mr Sutton, the Divisional Secretary, of resolutions passed requiring the holding of a referendum on the question whether the Divisional Executive should make rule amendments requiring the election of three officers by direct secret ballot of all financial members of the Division. A petition to the same effect was tabled by Mr Kingham at the meeting of the Divisional Executive on 21 March 2001. The first respondents (whom I shall refer to as "the respondents") contend that neither the resolutions nor the petition fulfilled the requirements of the rules and the Divisional Executive was therefore not obliged to conduct a referendum.
99 As to the first issue raised by the appellants, his Honour the primary Judge, Goldberg J, held that there was nothing in the rules which created a right in any person to have the Divisional Conference review a decision of the Divisional Executive. Rule 9.15 of the Divisional Rules provides that the exercise by the Divisional Executive of its powers are subject to review by the Divisional Conference. This rule was relied upon by the respondents as creating an obligation, on the part of the Conference, to review the Executive's actions upon request, although the question whether this applied to any request which was made was left largely unresolved in argument. His Honour observed that there was no mechanism provided by the rules to deal with requests. In his Honour's view the language of Divisional Rule 9.15 left it to the Divisional Conference to determine whether to review. It was under no duty to do so. I respectfully agree. It would follow that there can be no implied restraint on the power of the Divisional Executive to give effect to its decision pending a review as requested, as the respondents contended. It would not seem to me necessary to consider whether that is the case where the Divisional Conference has not yet determined whether to review.
100 A number of issues concerning the holding of a referendum arose for his Honour's consideration. The question whether the Divisional Branches' resolutions were effective for the purpose of requiring the Divisional Executive to hold a referendum turned largely upon the construction of r 10(i) of the Divisional Rules:
"(i) On a decision of a majority of Divisional Branches, or Divisional Branches whose membership constitutes a majority of the members of the Division or on receipt of a petition signed by not less than 10 percent of the financial members of the Division, Divisional Executive shall take a referendum of the whole of the members of the Division upon the matter or matters submitted by the Divisional Branches or members. A decision reached by a majority of the actual votes recorded shall be binding on the Divisional Conference Divisional Executive and the members of the Division. …"
Rule 20 of the rules of the CFMEU ("the National Rules") is in similar terms.
101 It was argued by the appellants before his Honour that the four Divisional Branches' membership constituted a majority of the members of the Division. The appellants however accepted that if this part of the rule referred to both unfinancial and financial members, the four branches would not have the required number. Their argument depended upon the reference to "members" and "membership" in the first part of the rule being read as referable to financial members. His Honour rejected that construction. His Honour gave the terms their defined meanings. I agree that his Honour was correct in that approach for the reasons given by Wilcox J and Marshall J. The fact that the rule goes on to refer to financial members only as being eligible as petitioners is explicable. There is not an obvious inconsistency with the earlier part of the rule.
102 Substantial argument was addressed to the alternative method undertaken for the calling of the referendum, namely the petition. (A number of documents containing the names of persons said to be members and their signatures are collectively described as "the petition"). When the petition was tabled at the meeting on 21 March 2001, Mr Kingham put a motion to establish a committee to check the financial status of the signatories to the petition. The motion was lost. Instead, the Divisional Executive resolved to seek legal advice in relation to the Divisional Executive's obligations with respect to the petition. On 28 March 2001 a physical examination of the documents was commenced. On 2 April Mr Sutton instructed the National legal officer and another person to oversee the process of checking not only the financial status of members, but also whether there was an application for membership relating to that person in the Division's records, and whether the signatures were genuine. This process was undertaken until 7 June 2001.
103 These actions, on the part of the Divisional Executive, occurred in the background of the appellants having applied to the Court, on 22 March 2001, for orders requiring the respondents to show cause why orders should not be made requiring them to perform and observe the rules of the Division. In particular, an order was sought requiring the respondents to forthwith make all necessary arrangements for the holding of a referendum of the financial members of the Division on the question set out above.
104 There were 8,615 signatures on the petition. The report commissioned by the Divisional Executive advised that 7,376 of the persons named were financial members. The parties further adjusted this figure to 6,972. These adjustments took account of signatures which were obviously frivolous and any duplications. The figure reached was a little more than the requisite ten per cent of financial members. The report of the investigation was to the effect that application forms for membership could be found only with respect to 5,257 of those persons. The other 1,715 petitioners were shown as financial members in the various records of the Division but no application forms completed by them could be found. His Honour was satisfied that the 1,715 persons should be regarded as financial members of the Division. The respondents challenge that finding. In their submission, proof of payment of dues does not amount to proof of membership. Further, the evidence disclosed that some payments had been made by persons other than the applicant for membership. In those cases, it was submitted, a conclusion that the person intended to become a member was not possible.
105 Rule 7(v)(a) of the National Rules tells against the respondent's argument. It provides, in relevant part:
"Notwithstanding anything elsewhere contained in the Rules of the Union no application for membership of the union shall be void or irregular only for the reason that the form of application is not fully completed or completed at all, or that some other form of application is used, or any other procedure under the Rules has not been complied with provided that the person intended to, and did in fact, in some way or other, apply for membership and the Union treated the person as a member…For all purposes the payment of union dues in whole or in part shall be taken to be, without limiting the generality of the foregoing, a method by which a person intended to, and did in fact, in some way or other, apply for membership and/or evidences an intention to be or become a member".
106 His Honour held that the rule does not require a completed application form as a precondition to membership. Under the rule a person may be a member despite a form not being completed. What is necessary is that the person intended to become a member and payment of union dues is evidence of that intention. His Honour also held that the rule could be construed to refer to payments by that person or to a payment being made on their behalf and that such an approach was consistent with other methods of payment referred to in the Divisional Rules. It has not been shown that his Honour was in error in these respects. It follows that the appellants were not obliged to produce applications for membership before a person could be counted as a member.
107 Additionally, as his Honour observed, the 1,715 persons were treated as members in the records of the union. This might be sufficient to give rise to a presumption - to the effect that the correct procedures relating to applications for membership had been followed. Later in these reasons I deal with the question of a presumption which might apply in connexion with the signatures on the petition. A similar argument was not however raised on the topic of membership and it is not necessary to deal with it further.
108 The lack of production of signed application forms was said to have another significance in the respondents' argument. This was so because, it was contended before his Honour and on appeal, the appellants were obliged to prove, to his Honour's satisfaction, that ten per cent of financial members had in fact signed the petition. That required their signatures to be verified in some way.
109 The appellants produced evidence from 458 of the 1,715 signatories in question, to the effect that they had completed application forms for membership and signed the petition. Their numbers were not sufficient to take the number of persons whose signature had been verified to over ten per cent. A question which arises on this appeal is whether that was necessary to be shown.
110 The questions, for his Honour's determination, did not include one as to whether the Divisional Executive had been obliged to call a referendum when the petition was received by it, or whether it remained obliged to call it on the basis of the facts shown about the number of financial members who had apparently signed the petition. His Honour recorded that the parties joined in formulating questions which included the following:
"D. On the true construction of the rules of the Union insofar as they are binding on members of the Construction and General Division:
…
3. Does the Divisional Executive have the right and/or power to determine whether a signature on a petition is the signature of a member and determine whether the requirements of Divisional Rule 10 have accordingly been met?
4. Has the petition been signed by ten per cent of the financial members of the Construction and General Division?"
111 His Honour addressed the questions posed and answered that numbered D3 in the affirmative. So far as concerned D4, his Honour was not satisfied that the applicants had made out their claim that ten per cent of the financial members of the Division had signed the petition. His Honour considered that, since the applicants had asserted those facts, they were required to establish them by admissible evidence and they had not done so.
112 On the hearing of this appeal the appellants submitted that his Honour ought to have determined that the requisite ten per cent of financial members had signed the petition and, in doing so, ought to have applied a presumption of regularity.
113 The question, whether a presumption is to be applied to the signatures on the petition, does not appear to have been expressly raised before his Honour. Indeed, the approaches taken by the parties and the questions they posed appear to have somewhat confused the evidentiary issue. The appellants apparently took it upon themselves to adduce evidence from 458 persons, although they explained this approach as providing support for the application of a presumption that persons shown as signatories had in fact signed the documents. That is, to an extent, borne out by the written submissions. It has not been shown that the appellants, by their conduct at the hearing before his Honour, bound themselves to prove each signature. To the contrary their written submissions rely upon the petition as prima facie proof and contain the assertion that the respondents are therefore required to adduce evidence to the contrary. They did not identify a particular presumption which was said to apply to the facts of the case. Instead they relied upon s 48 of the Evidence Act 1995 (Cth) to prove the contents of the petition. His Honour ruled, correctly in my view, that the section did not apply and the matter was not further pursued on appeal.
114 The argument now advanced by the appellants does arise in connexion with the value of the petition as evidence, an issue which was raised before his Honour. His Honour determined that the appellants were obliged to go further than reliance upon the signature appearing in the petition alongside the name of the financial member. This is not a case of a fresh issue being raised upon appeal: as to which see most recently Branir Pty Ltd v Owston Nominees (No 2) Pty Ltd [2001] FCA 1833 [38] per Allsop J). The respondents were clearly alerted to the extent of the reliance the appellants placed upon the petition and were content to have the matter determined by reference to whether the burden of proof was discharged. In that process the respondents had adduced evidence of the investigation into the petition. The reports contained no reference to doubts being held about the veracity of the 1,715 signatures. The matter was dealt with as a legal question. The argument relying upon presumptions of regularity was raised and addressed in argument on the appeal. It would seem to me just in the circumstances that the appellant now be permitted to further develop the argument it advanced before his Honour.
115 The maxim that everything is presumed to be rightly and duly performed ("omnia praesumuntur rite esse acta") is regarded as both fundamental to law and of wide application: Morris v Kanssen [1946] AC 459, 475. It applies to acts of an official or public nature: see Wigmore Evidence in Trials at Common Law, Vol 9, Chadbourn Revision, 1981 at para 2534; Phipson on Evidence 15th ed. 2000 at para 4-28; Broom's Legal Maxims, 6th ed. 1884 at p. 899. As Lord Simonds observed in Morris v Kanssen (at 475) it is illustrated in the law of agency by the doctrine of ostensible authority and its application to the law relating to corporations is similar. As his Lordship there observed "The wheels of business will not go smoothly round unless it may be assumed that that is in order which appears to be in order". This is reflected in the "indoor management rule" of corporations: see Northside Developments Pty Ltd v Registrar-General (1990) 170 CLR 146, 171. There would not seem to me to be any bar to the application of the same principle to the business of unions, given that they are organisations of a public nature, governed by rules and registered under the Workplace Relations Act 1996 (Cth) (see generally Edgar and Walker v Meade (1916) 23 CLR 29, 43-44).
116 It is necessary however to consider what is here sought to be proved by means of a presumption of regularity. In one sense the members of the Union are undertaking a procedure provided by the rules. A difficulty in the application of the presumption, it seems to me, is that what is sought to be established is the singular fact that the individual named signed the petition. This does not involve questions of authority or inferences to be drawn from other acts. The other cases to which the appellant referred, Dawson v Westpac Banking Corporation (1991) 104 ALR 295 and NZI Securities Australia Ltd v Poignand (1994) 51 FCR 584, involved presumptive proof of a prior act having been performed (see also Carpenter v Carpenter Grazing Co Pty Ltd (1987) 5 ACLC 506, 514 as to when the presumption may be drawn in such circumstances).
117 Perhaps closer to the facts of this case is the presumption of the law in favour of honesty and against fraud. It has been regarded as coming under the general presumption referred to above: Broom's Legal Maxims atp. 901 and the cases therein cited. Like that presumption, it is rebuttable. There being no presumption of fraud or wrongdoing it must be distinctly alleged and proved: Joseph Constantine Steamship Line Ltd v Imperial Smelting Corp Ltd [1942] AC 154, 192. It would follow, in my view, that the onus of proving any of the signatures to be false would be upon the first respondents.
118 In any event it would seem to me, with respect, that an approach which focuses only upon evidentiary matters might overlook a consideration of what the rules of the Division, and in particular Rule 10(i), have to say about what the parties must do or establish.
119 On a plain reading of the rule, the Divisional Executive is obliged to act "on receipt of a petition…" (emphasis added). This would not suggest to me that it was intended that it then take some months to undertake investigations to determine if the signatures were false or not. It is true that the petition is also required to be signed by the requisite number of members, but there is nothing in the rules which requires the petitioners to have their signatures verified in some way. As his Honour found, it was not necessary to a conclusion that they were financial members that they had signed an application form. On the other hand, the Union and the Divisional Branches were in a position to require members to sign an application form and otherwise identify themselves (:Divisional Rule 4(i); National Rule 7(i)) and then to maintain this information as part of their records. In these circumstances it seems to me quite unlikely that the rules contemplated that the members were to take further action to prove their petition. The Union or Divisional Branches were more likely to be in a position to check signatures. In my view, upon receipt of a petition the onus is clearly on the Divisional Executive to hold a referendum or challenge the petition. In this latter respect I do not doubt its ability to challenge the fact of membership of a person named, or a signature as false, on proper grounds, and that a short period may be necessary to check the status of the person against the records. .
120 The provisions of s 187A(a) and (b) of the Workplace Relations Act 1996 (Cth) would also appear to be relevant to any question of construction of the rules. They provide that the objects of Part IX, which deals with registered organisations, include these objects:
"(a) to encourage the democratic control of organisations; and
(b) to encourage members of organisations to participate in the organisations' affairs".
121 It would not seem to me to be consistent with these objects to read the rules in such a way that the petition of members was not required to be acted upon for a period and to require the members to undertake the burdensome task of verifying the substantial number of signatures necessary.
122 Rule 10(i) is similar in its terms to articles or statutory provisions which allow a proportion of shareholders of a corporation to requisition an extraordinary general meeting (see s 249D(1) Corporations Law,which reduced the number of holders of paid up capital necessary to call a meeting from ten to five per cent). The cases and texts contain numerous observations to the effect that a Court will be reluctant to interfere with the shareholders' right to requisition a meeting and will not impede their reasonable efforts to call a meeting. (See eg Halsbury's Laws of England, Vol 7(1) at para 662 and the cases therein cited including Fruit & Vegetable Growers Association Ltd v Kekewich [1912] 2 Ch 52, 57). They confirm that the directors of a company are bound to give effect to a requisition. Their duty arises "once a requisition of shareholders properly delivered … has been received …": Premier Gold NL v Hampson-Tindale (1994) 12 ACLC 931, 935.
123 There do not appear to be many decided cases dealing with the requirements of the requisition itself, namely that the requisition be in writing and signed by the members making it (and see s 249D(2)(c)). This may reflect the fact that such issues do not often arise. This may be understandable. It has been held that the shareholders making the requisition be identified in the notice: Young v Falkirk Football & Athletic Club Ltd (1993) G.W.D. 11-714, noted in Palmer's Company Law, Vol 2, 25th ed. at para 7.406. A similar requirement might apply in the case of unions so that each person's status as a financial member might be checked against the union records. It does not appear to have been suggested in cases or commentaries that the signatures appended must be proved in some way as a pre-condition to directors calling the meeting.
124 There remains one further issue concerning the petition raised by the respondents' notice of contention. It was submitted before his Honour, and on appeal, that an order should not be made requiring a referendum to be held since the question, if answered in the affirmative, would not be effective to alter the method of election without an alteration to the National Rules of the Union and the Divisional Conference or the Divisional Executive do not have the power to alter the National Rules.
125 The change referred to in the referendum question is to the method of election of certain of the officers of the Divisional Executive. Presently Divisional Rule 9.2 provides that members and officers of the Divisional Executive are to be elected by or from the Divisional Conference. The question sought to be put to a referendum was:
"Should the Divisional Executive of the CFMEU's Construction and General Division forthwith make all necessary rule changes so that, as from and including the elections due in 2001, the offices of Divisional President, Divisional Secretary and the two Divisional Assistant Secretaries must all be filled by direct secret ballot of all the financial members of the Division."
126 The election of persons to the Divisional Conference, which is the supreme governing body of the Union (National Rule 13 and Divisional Rule 8(i)), is conducted separately from the election of persons to the Divisional Executive. National Rule 17 provides the procedures for the election of delegates to the Divisional Conference. The method is by direct ballot of the financial members of each Divisional Branch: National Rule 17(i). The ballot is a secret postal ballot: 17(iii)(a). National Rule 17(iii)(e), to which the respondent's argument is addressed, requires that nominations for the position of Divisional Branch delegates of the Divisional Conference be called for in an advertisement. The rule requires that the advertisement
"…clearly indicate that the Divisional Executive and full time Divisional Officers are elected by and from members of the Divisional Conference, that the members of the Divisional Executive make up the National Conference and that National Officers are made up of the principal officers of each Division."
127 If the method of election of some of the officers of the Divisional Executive is altered in the way proposed, this advertisement would not be accurate. To be accurate it would need to inform members that the four Divisional Executive Officers in question are elected by direct ballot of the financial members of the Division and the remaining members and officers of the Divisional Executive are elected by the Divisional Conference. Both methods are permitted by National Rule 18, which deals with the Divisional Executive elections and provides that the composition and manner of election of that body is to be provided by the Divisional Rules.
128 His Honour, Goldberg J, did not consider that any amendment would be necessary to National Rule 17 if the Divisional Rules dealing with the election of the Divisional Executive were altered. National Rule 17 does not itself specify how those elections are to be conducted. It is concerned with the election of the Divisional Conference. In his Honour's view subrule (iii)(e) of that rule should be read as requiring an advertisement which reflects the true position under the Divisional Rules as to how the Divisional Executive is elected. I respectfully agree. The respondents have not shown his Honour's approach to be in any way erroneous.