Moranbah North Coal v Construction, Forestry, Mining and Energy Union

REASONS FOR JUDGMENT 1 This is an application pursuant to s 178 of the Workplace Relations Act 1996 (Cth) ("the Act") and seeks a penalty order in respect of a breach of a s 127(2) order of the Australian Industrial Relations Commission. The applicants seek a declaration that the respondent breached the Shell Coal Award Simplification Protest Industrial Action Order 2000 dated 18 June 2000 ("the Order") made by Commissioner Bacon of the Australian Industrial Relations Commission on 18 June 2000. Penalties pursuant to s 178(4) of the Act are also sought. History 2 The first applicant, Moranbah North Coal (Management) Pty Ltd ("Moranbah North Coal") is the operator of and employer of the workforce at the Moranbah North Coal Mine, situated in the Central Queensland Bowen Basin. The owner of that mine is the Moranbah North Coal Joint Venture, and the coal produced from that mine is sold by each joint venture participant to Moranbah North Coal (Sales) Pty Ltd. 3 The second applicant is the operator of and employer of the workforce at the German Creek Coal Mine, situated in the Central Queensland Bowen Basin, approximately 250 kilometres south-west of Mackay. The German Creek Mines comprise two underground longwall mines (central and southern collieries) and an open cut mining operation. 4 The third applicant is the operator of and employer of the workforce at the Callide Coalfields, situated in Central Queensland, near Biloela, south-west of Gladstone. The Callide Coalfields comprise four open cut mining operations, known as Dunn Creek, Boundary Hill, Trap Gully and The Hut. 5 The fourth applicant is the operator of and employer of the workforce at the Dartbrook Mine, located near Scone, in the Hunter Valley in New South Wales. 6 The fifth applicant is the operator of and employer of the workforce at the Drayton Mine, situated near Muswellbrook in the Hunter Valley in New South Wales. 7 The respondent, the Construction, Forest, Mining and Energy Union (the CFMEU) is a trade union registered as an organisation under the Act and a body corporate capable of being sued in its registered name, pursuant to s 192 of the Act. The CFMEU admits that the first applicant employs members of the CFMEU at the Moranbah North Mine, pursuant to the Moranbah North Coal Enterprise Interim Award 1997; that the second applicant employs members of the CFMEU at the German Creek Mines, pursuant to the German Creek Surface Operations Certified Agreement 1998, the Capricorn Coal Management Pty Ltd and CFMEU and CEPU Certified Agreement 1996, and the Capricorn Coal Management Pty Ltd and CFMEU Certified Agreement 1997; that the third applicant employs members of the CFMEU at the Callide Mines, pursuant to the Callide Coalfields CFMEU Enterprise Agreement 2000; that the fourth applicant employs members of the CFMEU at the Dartbrook Mine, pursuant to the Dartbrook Enterprise Agreement 1999; and the fifth applicant employs members of the CFMEU at the Drayton Mine, pursuant to the Drayton Coal Industry Agreement 1999. 8 The CFMEU admits that, on Sunday 18 June 2000, Commissioner Bacon of the Australian Industrial Relations Commission made the following orders addressed to the applicants and to the respondent: "In the matter of: work that is regulated by: · Moranbah North Coal Enterprise Interim Award 1997; · Dartbrook Enterprise Agreement 1999; · Drayton Coal Industrial Agreement 1999; · German Creek Surface Operations Certified Agreement 1998; · Capricorn Coal Management Pty Ltd and CFMEU and CEPU Certified Agreement 1996; · Capricorn Coal Management Pty Ltd and CFMEU Certified Agreement 1997; · Callide Coalfields CFMEU Enterprise Agreement 2000. (the 'Agreements'). 1. Title This Order shall be known as the Shell Coal Award Simplification Protest Industrial Action Order 2000. 2. Persons Bound and Application of Order This Order applies to: (a) the Construction, Forestry, Mining and Energy Union (the 'CFMEU'); and (b) employees of the Companies who are employed at the Moranbah North, German Creek, Callide, Dartbrook and Drayton mines, ('the Mines') who are members of the CFMEU and who are engaged in work which is regulated by the Agreements (the 'Employees'); 3. Industrial Action to Stop (a) The Employees must not, in respect of or in any way in connection with, the decision of the High Court in Re Pacific Coal Pty Ltd; Ex parte Construction, Forestry, Mining and Energy Union [2000] HCA 34 (15 June 2000) or the recent Award Simplification decision of the Full Bench of the Australian Industrial Relations Commission (Print S6142): (i) engage in industrial action being a refusal to attend for work; (ii) engage in industrial action being a refusal to perform work; or (iii) engage in industrial action being the imposition of restrictions, bans or limitations on the normal performance of work or on acceptance of or offering of work. (b) The Employees must attend work and perform work as normal, without any restrictions, limitations or delays. (c) The CFMEU must, in respect of or in any way in connection with, the decision of the High Court in Re Pacific Coal Pty Ltd; Ex parte Construction, Forestry, Mining and Energy Union [2000] HCA 34 (15 June 2000) or the recent Award Simplification decision of the Full Bench of the Australian Industrial Relations Commission (Print S6142): (i) Stop (whether by its officers, servants, agents or howsoever otherwise) and not recommence any ban on members of the CFMEU attending for and performing work in accordance with the Agreements; (ii) Not (whether by its officers, servants, agents or howsoever otherwise) direct, procure, advise or authorise its members to stop performing work in accordance with the Agreements; (iii) Withdraw its request that the coal industry cease work and immediately advise all relevant Lodge Secretaries that this request has been withdrawn and direct the relevant Lodge Secretaries that a return to normal work, without any restrictions, limitations or delays, must occur immediately. 4. Service of Order (a) Service of a copy of this Order upon the President or Secretary of the CFMEU Lodge at a Mine shall be sufficient service of this Order upon employee members of the CFMEU Lodge at that Mine. (b) Service of this Order personally upon an officer of the CFMEU Mining & Energy Division shall be sufficient service of this Order on the CFMEU and its officers. (c) Notification by telephone of the making of this Order to an officer of the CFMEU Mining & Energy Division shall be sufficient service of this Order upon the CFMEU if that notification is given at any time after a copy of this Order is served by facsimile on the Queensland office of the CFMEU Mining & Energy Division. 5. Term and Date of Effect This Order shall come into effect from 11.30pm 18 June 2000 and shall remain in force for a period of 7 days." ("the Order") 9 The CFMEU does not admit that the orders made by Commissioner Bacon were within the power conferred under s 127 of the Act. 10 Service of the Order, as alleged by each of the applicants, is denied by the respondent. Each applicant claims: "1. A declaration that the Respondent has breached the Order in that it: (i) Did not stop (whether by its officers, servants, agents or howsoever otherwise) any ban on members of the CFMEU attending for and performing work in accordance with the Agreements; (ii) Did continue to (whether by its officers, servants, agents or howsoever otherwise) direct, procure, advise or authorise its members to stop performing work in accordance with the Agreements; (iii) Did not withdraw its request that the coal industry cease work and immediately advise all relevant Lodge Secretaries that this request has been withdrawn and direct the relevant Lodge Secretaries that a return to normal work, without any restrictions, limitations or delays, must occur immediately. for the purposes of a dispute about the decision of the High Court in Re Pacific Coal Pty Ltd; Ex parte Construction, Forestry, Mining and Energy Union [2000] HCA 34 (15 June 2000) or the recent Award Simplification decision of the Full Bench of the Australian Industrial Relations Commission (Print S6142). 2. That a penalty be imposed on the Respondent pursuant to section 178(4) of the Workplace Relations Act 1996 for its breach of the Order; 3. That the penalty payable pursuant to paragraph 2 above be paid to the First Applicant within seven (7) days of service of the order on the Respondent. 4. In the alternative to paragraph 3 above that the penalty payable pursuant to paragraph 2 above be paid to the Registrar of this Honourable Court within seven (7) days of service of the order on the Respondent for payment into the Consolidated Revenue Fund." 11 Paragraph 3(c) of the Order of Commissioner Bacon required the CFMEU, in respect of or in any way in connection with, the decision of the High Court in Re Pacific Coal Pty Ltd; Ex parte Construction, Forestry, Mining and Energy Union [2000] HCA 34 (15 June 2000) or the recent Award Simplification decision of the Full Bench of the Australian Industrial Relations Commission (Print S6142), to stop and not recommence any ban on members of the CFMEU attending for and performing work in accordance with the agreements; to not direct, procure, advise or authorise its members to stop performing work in accordance with the agreements; and to withdraw its request that the coal industry cease work and immediately advise all relevant Lodge Secretaries that this request has been withdrawn and direct the relevant Lodge Secretaries that a return to normal work must occur immediately. 12 There is evidence before the Court establishing that there was a failure by employees to return to work. In respect of Capricorn Coal, it appears from the affidavits of Mr Hendry and Mr Jakeman that none of the employees rostered to commence the nightshift on 19 June attended for work, and that no CFMEU employees had returned by 6.00 am 19 June. In respect of Callide, the affidavit of Mr Gillett establishes that CFMEU members did not return to work until the commencement of the night shift (10.30 pm 19 June). In respect of Dartbrook, the affidavit of Mr Anderson shows that the majority of members did not return to work until the commencement of the night shift on 19 June. In respect of Drayton, the affidavit of Mr Hughes establishes that the employees rostered to start the night shift at 11 pm 19 June did not attend for work; and in respect of Moranbah North, the affidavit of Mr Lawrence establishes that at 6.50 am 19 June no employees of the CFMEU had returned to work. 13 The reference to the directions by Commissioner Bacon to the CFMEU contained in par 3(c) of the Order linking those directions to the High Court decision in Re Pacific Coal Pty Ltd; Ex parte Construction, Forestry, Mining and Energy Union [2000] HCA 34 (15 June 2000) or the Award Simplification decision (Print S6142) creates a complication. The evident purpose of that reference is to limit the application of the Orders to the ban which the Commission found was in effect, and which it is evident the Commission believed was connected with either the High Court decision in Re Pacific Coal or the Award Simplification decision. The reference to those matters in the Order contained in par 3(c), it seems to me, was not to impose any restrictions on the CFMEU in respect of bans that might have a different provenance, and be quite unconnected with the industrial circumstances which led to Commissioner Bacon making his Orders. 14 The applicants invite the Court to infer, from the failure of the employees to return to work, that there was a breach by the CFMEU of its obligations pursuant to the Order. It is unnecessary in this case to determine whether there was a breach by the CFMEU of its obligations pursuant to the Order, because it is first necessary for the applicants to prove that the CFMEU was served with the Order in the manner which the Order required. 15 The applicants rely only on service according to par 4(b) of the Order. The evidence establishes that Mr Jakeman received a facsimile copy of the Order which he then served personally upon a Mr Steven Davison, the President of the Southern Colliery Lodge, at 1.45 am 19 June 2000 at his home in North Middlemount. Mr Davison was not served with the Order, but with a facsimile copy of it. 16 In my opinion, the application fails because the applicants have not established service of the Order of Commissioner Bacon on the CFMEU, as required by the Order. There are two aspects concerning what is relied upon by the applicants as service which are fatal to the proof of the element of service. 17 In order to comply with par 4(b) of the Order, personal service of the Order has to be effected on an officer of the CFMEU Mining & Energy Division. In my opinion, service of a facsimile copy of the Order is not service of the Order. Secondly, the person served with a copy of the order was Mr Davison, who was the President of the Southern Colliery Lodge. In my opinion, this service is not service on an officer of the Mining & Energy Division, as required by par 4(b) of the Order. Service of the Order 18 Paragraph 4(a) of the Order directs that service of a copy of the Order upon the President or Secretary of the CFMEU Lodge at a mine shall be sufficient service of the Order upon employee members of the CFMEU Lodge at that mine. This specifically permits service of a copy of the Order to constitute sufficient service upon employee members of the CFMEU, and further contemplates that service on the President or Secretary of the Lodge at a mine is sufficient service upon employee members of the CFMEU Lodge at that mine. 19 These provisions as to service of the Order on employee members of the CFMEU are to be contrasted with the requirements of service of the Order on the CFMEU. Commissioner Bacon there ordered that the Order had to be served before it could constitute sufficient service, and required personal service of the Order. The contrast with a copy of the Order referred to in par 4(a) of the Order is plain. In my opinion, what was required was service of the Order and service of a copy of the Order is not sufficient service. This follows, in my view, from a plain reading of the terms of Commissioner Bacon's Order. 20 While the context is vastly different, the Bankruptcy Act 1966 (Cth) and the Rules make it clear that an authenticated bankruptcy notice, and not a copy or its equivalent, is required to be served personally on the debtor: Re Ronald Thorpe; Ex parte Noel Perry [1988] FCA 283, an unreported judgment of Lee J in Perth on 1 June 1988. What is common in the present circumstances and those involving service of bankruptcy notice is that each is a serious matter and might involve consequences that have been described as quasi-penal in nature: Re Long; Ex parte Fraser Confirming Pty Ltd (1975) 24 FLR 392, referring to the commission of an act of bankruptcy. 21 It is also to be noted that par 4(c) contemplates service by facsimile. Officer of the CFMEU Mining & Energy Division 22 In my opinion, Mr Davison, as the holder of a position in a Lodge, namely President of the Southern Colliery Lodge, was not, on that account, an officer of the CFMEU Mining & Energy Division as the term was used in the Order. I think so much appears from the Order on its face; it also follows, in my opinion, from the Rules of the CFMEU and from the Act. Whilst the terms "officer" and "office" have defined meanings in the Act, there is no basis for assuming that Commissioner Bacon was using the words in anything other than their ordinary meanings, with "officer" referring to a person holding office within the divisional structure of the Union. To permit service of an Order binding upon the CFMEU upon a Lodge official would be illogical because it would direct service on a person with no power to effect compliance with the Order. I accept the submissions of Ms Howell, counsel for the CFMEU, in this regard. 23 The power with respect to the management of industrial disputes resides under the Rules of the CFMEU with the Central Executive: Rules of the Mining & Energy Division r 10(iv)(c). A Lodge official would have no power to take any steps on behalf of the CFMEU to commence or end any stoppage. If service on a Lodge official, many of whom are full-time miners, would constitute sufficient service on the CFMEU, it would mean that service on a local Lodge official in another state would be effective service in respect of actions required to be done by the CFMEU in a different state. Similarly, service on a Lodge official in the New South Wales Energy Division, which has no connection with the mining industry, would be sufficient service on the CFMEU in respect of a mining dispute in Queensland. 24 As counsel for the CFMEU points out, to treat a Lodge President as an officer for the purposes of par 4(b) of the Order would have the effect that, with respect to par 4(c) of the Order, a notification of the Order by telephone to the Lodge official after the service of the Order by facsimile on the Queensland Office of the Mining & Energy Division would constitute service on the CFMEU, but not service on the employees who are expressly permitted to be served via the same individual. For service on those employees, a service of a copy of the Order on the Lodge official would be required. 25 I accept that the plain meaning and obvious intent of the Order was that a person holding an office in the Divisional structure should be served, so that appropriate steps could be taken, consistent with the Rules of the CFMEU, to obey the Order. The Rules of the CFMEU confirm, in my opinion, that a Lodge Official is not, by virtue of holding that position, an officer of the Mining & Energy Division. 26 The CFMEU is a union which, as a result of various amalgamations, is constituted by a number of divisions which operate on a national basis. One such division is the Mining & Energy Division. As far as the divisional structure of the CFMEU is concerned, r 5 of the National Rules of the CFMEU ("the National Rules") provides various definitions, including the definition of "division". Rule 28 of the National Rules provides for divisions. The governing bodies of the Mining & Energy Division are the Central Council (r 8 of the Rules of the Mining & Energy Division) and the Central Executive (r 10 of the Rules of the Mining & Energy Division). 27 Central Council consists of the General President, General Vice-President, Senior Vice-President, two Vice-Presidents, the General Secretary, the National Conference Delegate and representatives of the District Branches: r 8(i)(b) of the Rules of the Mining & Energy Division. Each District Branch elects a number of representatives to Central Council in proportion to its membership: r 8(i)(c) of the Rules of the Mining & Energy Division. The Central Council is the supreme decision-making body of the Division and meets twice a year. Its powers and duties are set out in r 8(vi) of the Rules of the Mining & Energy Division. These powers include the general power to do all other acts, business and things which the Central Council decides are proper for the achievement of the objects established under these rules: r 8(vi)(n) of the Rules of the Mining & Energy Division. 28 The Central Executive consists of a number of "executive officers", being the General President, Senior Vice-President, General Vice-President, two Vice-Presidents and the General Secretary: r 10(i)(a) of the Rules of the Mining & Energy Division. The holders of these positions are described as "officers" throughout r 10. The duties of the Executive Officers are set out in r 10(ii) of the Rules of the Mining & Energy Division. The Central Executive has extensive powers, including the day-to-day care, control, custody, superintendence, management and administration in all respects of the affairs, funds and property of the Division: r 10(iv) of the Rules of the Mining & Energy Division. 29 The Central Council and the Central Executive constitute the collective bodies of the Mining & Energy Division. In my opinion, the members of those bodies are the officers of the Division under the Rules, as contemplated by the Act. 30 Rule 18 of the Rules of the Mining & Energy Division is important in the present context. It is headed "Eligibility for Divisional Office" and provides: "No member shall be eligible for any office unless he has been a financial member continuously for at least twelve (12) months …" This rule indicates that membership of the Divisional Office is to be distinguished from holding office in a Lodge, because eligibility for the Divisional Office requires financial membership for at least twelve months, where no such qualification period exists in relation to persons holding positions in Lodges. The Mining & Energy Division, like other Divisions of the CFMEU, has within it state-based branches known as "District Branches" and also has occupationally-based branches, such as the New South Wales Energy District Branch. There are general rules for District Branches provided for in the Rules of the Mining & Energy Division. Rule 12(iii)(d) of the Rules of the Mining & Energy Division provides: "All District Branches shall make rules for the establishment and government of Lodges of members of the division including provision for the election of Lodge Officers and representatives …" 31 The District Branches have autonomy in matters affecting the branch only: r 12(ii) and r (iii) of the Rules of the Mining & Energy Division. Within the general framework of r 12, District Branches have their own rules. In the branch structure, there is provision for Lodges to be established with respect to individual workplaces: r 12 of the Rules of the Mining & Energy Division. Branches are governed by a Board of Management (r 7 of the Branch Rules), and on a day-to-day basis by a District Branch Executive (r 9 of the Branch Rules). Lodges each elect one representative to the Convention (rule 7(i)(b) of the Branch Rules) which meets every four years (r 7(ii)(a) of the Branch Rules). The Board of Management meets at least three times a year (rule 7(ii)(a) of the Branch Rules). Lodges are grouped for the purpose of electing delegates to the Board of Management (about six Lodges for each delegate). The District Branch Executive consists of various named officers, some of whom are required under the rules to be full-time officers. 32 Lodges are formed under r 12 of the Branch Rules. Lodges have committees consisting of named officers and representatives. Lodges have limited powers and duties - in particular, they are not permitted to cease work without the sanction of the District Branch Executive of the Branch (r (ix)(a) of the Branch Rules). 33 The analysis of the Rules outlined in submissions by counsel for the CFMEU in my opinion makes it plain that the term "officer" is used to denote holders of named positions, such as President or Secretary. There is nothing to suggest that "Divisional Officer" under the Rules means anything other than a person holding such an office within the structures governing the Division as a whole. The ordinary meaning, and the meaning which in my opinion is that used by Commissioner Bacon of "an officer of the CFMEU Mining & Energy Division" did not extend to an official of a Lodge. 34 In my opinion, a Lodge President is not an "officer" of the Mining & Energy Division. 35 Under the Act, "officer" in relation to an organisation or branch of an organisation is a person who holds office in the organisation or branch. The definition of "office" in s 4 is: "office, in relation to an organisation or branch of an organisation, means: (a) an office of president, vice-president, secretary or assistant secretary of the organisation or branch; (b) the office of a voting member of a collective body of the organisation or branch being a collective body that has power in relation to any of the following functions: (i) the management of the affairs of the organisation or branch; (ii) the determination of policy for the organisation or branch; (iii) the making … of rules of the organisation or branch; (iv) the enforcement of rules of the organisation or branch …;" 36 The term "branch" is not defined in the Act. The Mining & Energy Division is not an organisation under the Act, but rather "a branch" of the organisation. It follows, in my opinion, that an officer of the Division is someone who is a member of a collective body which has power in relation to the management and affairs of the division. The bodies having such power are the Central Executive and the Central Council of the Division. 37 Northrop J in AFMEPKIU v Fohmsbee (1998) 83 FCR 161 at 177 said: "In common usage, each collective body within an organisation may be a collective body of the organisation … However, having regard to the consistent use in the Act of the phrase 'organisation or branch' there is much to be said for the view that a committee or collective body of an organisation should be limited to those committees or collective bodies having powers of management over the affairs of all members of the organisation while a committee or collective body of a branch refers to those committees or collective bodies having powers of management over the affairs of a limited group of members of the organisation coming within what constitutes a branch of the Organisation within the proper meaning of the word branch. However, no final opinion is expressed on this matter." 38 Persons who are, at best, officers of a Lodge are not, on that basis, officers of the Mining & Energy Division, because they do not hold an official position within that branch. They have no power within the CFMEU Mining & Energy Division structure which would confer upon them the status of officers of the Mining & Energy Division. 39 It follows that there was not service on the CFMEU, as the Order required. Since that is a necessary precondition to success on the present application, the application, made pursuant to s 178 of the Act for a penalty for breach of an order made under s 127 of the Act, is dismissed. I certify that the preceding thirty-nine (39) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Spender.