R v Joske; Ex parte Shop, Distributive & Allied Employees' Association

High Court of Australia|1976-07-01|Before: Murphy JJ, McTiernan J, Jacobs JJ

High Court of Australia Barwick C.J. McTiernan, Gibbs, Stephen, Mason, Jacobs and Murphy JJ. R v Joske; Ex parte Shop, Distributive & Allied Employees' Association [1976] HCA 48

In this matter I have had the advantage of reading the reasons for judgment prepared by my brother Stephen. I agree with him in thinking that the interim order made in proceedings No. 161 of 1974 was not made in relation to the matter to which those proceedings related within the meaning and operation of s. 141(2) of the Conciliation and Arbitration Act 1904, as amended ("the Act"). The power given by that section is not confined to the making of orders for the performance of or observance of rules of an organization: nor to orders germane to the relief claimed in the proceedings. The matter actually in dispute between the parties out of which the proceedings have arisen and to which they relate will satisfy the limitation contained in the final words of the sub-section. But even so, as my brother Stephen points out, the status of the applicant for prohibition was not in dispute: and it was to that status which the interim order itself related. For the reasons which my brother Stephen gives, I would make absolute the order nisi granted with respect to the interim order made in proceedings No. 161 of 1974.

I also agree with my brother Stephen's conclusion that the order nisi granted in relation to proceedings No. 295 of 1975 should be discharged. Section 171B of the Act does not afford any reason why an invalid act should not be restrained. That section does not purport to deprive a court of jurisdiction to restrain acts which, if they had been performed, would or might have fallen within the ambit of the operation of the section.

I also agree with my brother Stephen in his opinion that neither of the orders made in proceedings No. 300 of 1975 were beyond the power of the Industrial Court. I agree with my brother's reasons for that conclusion.

In the application for prohibition in relation to proceedings Nos. 301 and308 of 1975 respectively, an attack was made upon the constitutional validity of ss. 171C and 171D of the Act. The submitted ground of invalidity was that the sections purported to confer non-judicial power on the Industrial Court. This ground should be rejected because the nature of the relief which the sections auhorize is, in no sense, antithetic to the exercise of judicial power: indeed, on the contrary, it is of a kind which in other areas of the law courts are wont to give. I agree with my brother Stephen that the relief which a court is authorized to give consequentially upon its judicial determination of some situation can rarely, if ever, be denied the quality of an exercise of judicial power. I also agree with my brother that the authorized relief cannot, in any case, be regarded as of a non-judicial nature. I agree with his expressed reasons for that conclusion.

Being of this opinion, it is inappropriate in this matter to consider the propriety of the decision of the Court in Reg. v. Kirby; Ex parte Boilermakers' Society of Australia [1] .

In my opinion, all the orders nisi other than that made in relation to proceedings No. 161 of 1974 should be discharged.

I heard argument only upon the question whether the interim orders made were within statutory power. I am of opinion that upon the true construction of s. 141(2) of the Conciliation and Arbitration Act 1904, as amended ("the Act"), it conferred power upon the Industrial Court to make such orders.

I agree with the conclusion of the other Justices who have dealt with the question that ss. 171C and 171D of the Act do not purport to confer on the Australian Industrial Court non-judicial functions. Such powers as those sections give to the Court are of a judicial nature or incidental to the exercise of judicial power.

In the course of argument before a bench of which we were not members it was contended by the respondents, in answer to the submission of the prosecutors that ss. 171C and 171D of the Conciliation and Arbitration Act 1904 as amended, are invalid in that they attempt to confer non-judicial power on a federal court, that the Boilermakers' Case [2] should not be followed. Because of their importance the matters raised by the respondents' contention were argued separately before all members of the Court then available. However, the Court as constituted to hear the application to make absolute the orders nisi hold that the applications should be refused, thereby determining that ss. 171C and 171D do not attempt to confer on the Industrial Court powers or functions which are not judicial. The attack on the validity of those sections therefore fails, whether or not the decision in the Boilermakers' Case was correct. In these circumstances it is unnecessary to consider whether it would be right to reopen the decision in the Boilermakers' Case and if so whether that decision was incorrect and we would express no opinion one way or another on either of those questions.

The complexities of this case are principally of fact, not law and may be largely disregarded in these reasons for judgment; my views concerning each of the five orders nisi which are before the Court will sufficiently appear without detailed reference to the facts.

Each of the orders nisi relates to a distinct proceeding before the Commonwealth Industrial Court concerning the affairs of a trade union, the Shop Distributive and Allied Employees' Association. In three of those proceedings interim orders were made under s. 141(2) of the Conciliation and Arbitration Act 1904, as amended, and the power of the Industrial Court to make those interim orders is now challenged, it being further asserted that the making of the orders involved errors of law. In one of those same three proceedings an order, purportedly under s. 187 of the Act, authorized the inspection of union record cards and again jurisdiction to make the order is denied. In a fourth proceeding the Industrial Court was asked, in exercise of power conferred upon it by s. 171C, to declare invalid certain rules of the union and it is now said that that section is unconstitutional since it purports to confer non-judicial power upon a federal court. In the fifth proceeding the Court was asked to validate, under s. 171C, certain union proceedings and also to approve, under s. 171D, a scheme for the re-organization of the affairs of the union; these two sections are attacked as unconstitutional upon the like ground.

Three questions thus arise; two of them involve matters of statutory interpretation, the construction of s. 141(2), including its interaction with s. 171B, and of s. 187, and their application, when properly construed, to the particular facts. The third question raises a constitutional question, whether s. 171C and s. 171D involve the exercise of non-judicial power.

(1) The Court may, upon complaint by any member of an organization and after giving any person against whom an order is sought an opportunity of being heard, make an order giving directions for the performance or observance of any of the rules of an organization by any person who is under an obligation to perform or observe those rules.

(2) At any time after proceedings under this section have been instituted (including proceedings instituted before the commencement of this sub-section), the Court may make such interim orders as it thinks fit in relation to the matters to which the proceedings relate.

(3) An order under the last preceding sub-section continues in force, unless expressed to operate for a shorter period or unless sooner discharged, until the completion of the proceedings under this section.

In proceedings No. 161 of 1974 the applicants, Egan and Davis, sought a large number of orders, none of them concerned with the status, as a financial member of the relevant union, of its New South Wales branch. Nevertheless the Court, on application by one of the individual respondents, made an interim order against the rest of the respondents that the branch "be deemed to be for all purposes of the organization a financial member of (the Union) for 36,741 members". In doing so it purported to be exercising powers under s. 141(2) but the prosecutors assert that in the circumstances that sub-section confers no such power; they add that in any event the order wrongly went against the union itself, it being one of the respondents and they also point to the fact that in the proceedings the applicants contended that none of the individual respondents other than those representing the New South Wales branch were members of the union.

In answer to the contention that there was no power to make the interim order, because it was not made "in relation to the matters to which the proceedings relate" - s. 141(2), it was said that even if the relief sought in the proceedings did not concern the status of the New South Wales branch, this requirement of the sub-section was nevertheless satisfied. To succeed, the proceedings required the making of orders against members of the union; according to the applicants there existed no valid membership other than that of the members of the New South Wales branch; it was therefore essential to the obtaining of relief that that branch be declared to be a member so that its own members might thereby be members of the union; this the interim order did. It is in this, so say the present respondents, that there is to be found the necessary relationship between the interim order and the "matters to which the proceedings relate".

No doubt were the New South Wales branch not a member of the union then, if the applicants were correct in denying membership of all others, there would exist no-one obliged "to perform or observe" the union's rules and against whom orders could be made. But this is a consideration quite unrelated to the meaning of the limiting words of sub-s. (2) - "matters to which the proceedings relate". Such "matters" must, I think, be found either in the "complaint by any member of an organization" by which proceedings are initiated or else, perhaps, in the substance of the dispute which underlies that complaint and which the relief sought seeks to resolve. It is as inappropriate to describe the branch's status as such a "matter" as it is to say of an action in tort or contract against a defendant that it "relates" to the fact of the defendant's existence as a legal person. Effect must be given to the concluding words of sub-s. (2). But for their presence interim orders might be made "as it (the Court) thinks fit"; as it is the sub-section restricts the Court's power in a quite specific manner. I find no warrant for departing from what I regard as the clear meaning of this restriction, that is, that the matters concerning which interim orders may be made must be coincidental with the matters to which the proceedings relate.

In the course of argument there emerged another possible answer to the principal attack made on this interim order. The respondent who applied for it might, it is said, have obtained a similar order had he instituted original proceedings under s. 141(1) instead of making application under sub-s. (2) in the course of the applicants' proceedings. In the light of reg. 155 of the Conciliation and Arbitration Regulations, which guards against proceedings being avoided for non-compliance with the regulations, any defect of form should not be regarded as affecting jurisdiction, particularly since no want of notice to other parties or of a fair opportunity to be heard could be made out.

In my view reg. 155(2) is not in point; it is concerned with non-compliance with regulations and no doubt would have authorized the Industrial Court to deal appropriately with any non-compliance with formalities required by regulation and which it encountered in the course of the application for the interim order. Perhaps it could thus have treated the application here in question as a substantive application proper to be dealt with under sub-s. (1) of s. 141, thus making an order under sub-s. (1) accordingly, but that would have been a final order, finally disposing of the complaint with which it originated. That is not at all the order which the Court in fact made, as it believed, under sub-s. (2); the order is in terms of an interim order and the reasons given by the Court for making it disclose, very naturally in the case of an interim order, a pre-occupation with the preservation of the status quo rather than with any ultimate resolution, by final order, of a complaint under sub-s. (1).

Accordingly, to disregard non-compliance with formal requirements so that the application may be treated as if made as a final order under s. 141(1) will only lead to the conclusion that the Court wholly misconceived its function when it made the order. An alternative would be to regard the Court as empowered to make an interim order, as it in fact did, still treating the actual application as if made under s. 141(1) but treating the order itself as if made under sub-s. (2), the absence of any separate application for it being accounted for by it being made by the Court of its own motion. Still another alternative would be to avoid altogether recourse to sub-s. (2), treating sub-s. (1) as itself authorizing interim orders. Neither of these suggestions will do; the unrealities they involve become manifest when the reasons given by the Court for the making of the order are examined. Were either of these alternatives to be accepted the Industrial Court would be being treated as if it had before it, when making the order, a situation quite different from that with which it was in fact presented; all else apart, it would be being asked to make the order not in the actual context of application No. 161 but in quite other circumstances. Whether in that case the interim order would ever have been made is problematic, but at least it is clear that the reasons for its making would not have been those which the Court in fact gave. This is, in my view, enough to dispose of these two alternatives.

I conclude accordingly that there was no power to make the interim order here in question and would accordingly make absolute the order nisi for prohibition. I need therefore not deal with such other arguments as were raised concerning proceedings No. 161 of 1974.

In the next proceedings, No. 295 of 1975, the interim order there made at the instance of the applicants, and in exercise of the power conferred by s. 141(2), is challenged on quite different grounds. That order required that certain respondents should not recognize other respondents as entitled to vote on particular motions moved at meetings of the national council of the union and that other respondents should not themselves vote on such motions.

The prosecutors contend that but for that order those motions might have been passed; and, even if invalid, would then have been proper subject matter for validation under s. 171B. The interim order, by ensuring that they were not passed, prevented a situation arising in which s. 171B might operate; the motions would, they say, have been passed "in good faith" and the invalidity affecting voting would only have been discovered "afterwards", both pre-requisites for the operation of s. 171B. The legislative intent is, it is said, that s. 141(2) should not be used so as to prevent advantage being taken of s. 171B in the very sort of case for which it is designed, yet a specific ground for the making of the interim order was precisely that, were it not made, advantage might be taken of s. 171B. Want of jurisdiction was said to arise because the Industrial Court was obliged not merely to take account of the existence of s. 171B in determining whether or not to make the interim order but positively to refuse the application because of its existence; its failure to do so meant that it acted without jurisdiction (Anisminic v. Foreign Compensation Commission, per Lord Reid [3] ).

It is clear from the material before this Court that, while the Industrial Court did have s. 171B very much in mind in making its interim order it did not regard it as any bar to the making of that order. The prosecutors' proposition must be that s. 141(2) should never be applied to prevent acts which may, or, perhaps are likely to, become appropriate for the grounding of an application for validation under s. 171B.

The Act does not anywhere state this proposition; in particular s. 141(2) contains no such limitation and in its absence s. 171B is still capable of useful work. Sections 171B and 171C are not, I think, to be regarded as any exclusive code, alone applicable to cases of invalid acts and their consequences. Moreover, as was said on behalf of the present respondents, these sections are primarily concerned with existing acts of invalidity and not with prospective acts the occurrence of which may be prevented by recourse to an order under s. 141(2).

For these reasons I would discharge this order nisi.

The third order nisi relates to proceedings No. 300 of 1975 in which two orders were made, one an interim order under s. 141(2), the other an order said to be made under s. 187 of the Act. By the first of these orders a respondent, Tacon, was required to take no further steps to conduct the election for officials in the Newcastle and Northern branch of the union. The steps in question were the counting of votes by Tacon and the declaration of the result of the poll. The prosecutors would deny to the Industrial Court power to make the order it did, there being no rule of the union which would be breached by a counting of votes and the declaration of the result of the poll.

The Industrial Court made the order because it thought that a strong prima facie case had been made out that the rule under which the entire election was conducted was invalid. In those circumstances it was, I think, clearly within power to make the order; its terms were, in the words of Dixon J. in R. v. Commonwealth Court of Conciliation and Arbitration; Ex parte Barrett [4] , "well framed to bring about a compliance with the rules", in the sense that to forbid acts which, if undertaken, would not be authorized by the rules and would involve giving positive and practical effect to impugned rules clearly assists in procuring such compliance.

In the case of this order reliance was also again placed upon s. 171B as limiting the power to make orders under s. 141(2). With that submission I have already dealt. I do not regard the prosecutors' adaptation of their previous argument to the circumstances of this order as any more persuasive than it was in matter No. 295 of 1975.

The order said to be made under s. 187 of the Act was an order entitling one Whalan "or any other agent of the parties" to inspect certain documents which were to be produced to the Court on subpoena duces tecum. Objection was taken to this order because s. 187, in referring to documents produced in evidence, speaks of their inspection by the Court and by "such of the parties as the Court allows" and neither Whalan nor "any other agent" would be such a party. The documents here in question have been produced to the Court and are now in its custody but they are not, and may never be, in evidence; accordingly s. 187 does not apply to them.

The purpose intended to be served by s. 187 is not clear; at least in so far as it entitles the Court to inspect documents in evidence before it it seems but to labour the obvious; whether its reference to inspection by "the parties" in fact limits the Court, in permitting inspection, to the parties themselves need not be determined. The fact is that the section is inapplicable to the present facts and the Court is, I think, then left with a discretion to allow inspection of documents which are in its custody but are not in evidence. It exercised that discretion in a particular manner and no question of want of jurisdiction or error of law arises.

I would accordingly discharge the orders nisi in this case.

In these two proceedings the applicants invoked the provisions of Part IXA of the Act. In the first of them declarations were sought, under s. 171C, that certain rules of the union were invalid and, under s. 171G, that to apply to those rules the validating power which s. 171B conferred would do substantial injustice. In the second proceedings a number of declarations were sought under s. 171D, coupled with an order approving a scheme for the reconstitution both of the branches and of the national council of the union.

The prosecutors now attack the constitutionality of ss. 171C and 171D; they assert that the power which those sections purport to confer upon the Industrial Court, a power which these two proceedings have sought to invoke, is non-judicial.

That the Industrial Court is a Court exercising the judicial power of the Commonwealth is common ground; the two further propositions, that such a Court may not have vested in it non-judicial powers and that the powers conferred by ss. 171C and 171D are in fact not judicial in character, are those on which the parties are at issue. To contest the first of these would involve a reversal of the decision in the Boilermakers' Case [5] and for that reason argument upon it was reserved for a bench of six Justices, which sat some time after the conclusion of the hearing of argument upon all other aspects of these proceedings. The second of these two contested propositions requires to be established by the prosecutors before any question concerning the first proposition can arise. I turn accordingly to examine this second contested proposition.

Section 171C first of all empowers the Industrial Court, on application made to it, to determine whether "an invalidity has occurred in the management or administration" of an organization or otherwise in specified ways related to its affairs; if so the Court may make such declaration as it thinks fit - sub-s. (1). So far the power conferred is clearly judicial. Then under sub-s. (2) (a) the Court may, if it determines that such an invalidity has occurred, "make such order as it thinks fit to rectify or cause to be rectified the invalidity, or to negative, modify or cause to be modified the consequences in law of the invalidity, or to validate any act, matter or thing rendered invalid by or as a result of the invalidity"; and before doing so must, under sub-s. (2) (b), "satisfy itself that such an order would not do substantial injustice to the organization or to any member or creditor of the organization or to any person having dealings with the organization". It is upon these two quoted provisions that the prosecutors rely in contending that a grant of non-judicial power is involved.

Section 171D(1) empowers the Industrial Court to declare that a part of an organization has ceased to exist or to function effectively or that an office or position in an organization has become vacant, and that no effective means exists under the organization's rules to remedy this. Then sub-s. (2) empowers the Court, having made such a declaration, to approve a scheme "for the taking of action by a collective body of the organization or of a branch of the organization or by an officer or officers of the organization or of a branch of the organization for the reconstitution of the branch or part of the branch, or of the collective body, or to enable it to function effectively, or for the filling of the office or position" (sub-s. (2)) but it must first satisfy itself "that the order would not do substantial injustice to the organization or to any member of the organization" (sub-s. (3)).

It is the power to rectify, modify or validate as the Court thinks fit, and the power to determine whether an organization has ceased "to function effectively" and, if so, to sanction a scheme to rectify the position, in each case qualified only by the provision as to substantial injustice, that are particularly seized upon by the prosecutors as revealing in these sections that other than judicial power has been conferred on the Court.

These provisions are concerned exclusively with the nature of the remedies open to the Court once it has adjudicated upon matters which have been initiated by a party and the determination of which is an eminently judicial function. The particular nature of an available remedy, at least when it is one not unfamiliar as part of the traditional equipment of courts of law or equity, can seldom be such as of itself to involve a court in a non-judicial function.

The power in s. 171C(2) to relieve against what otherwise would be the invalidating effect of non-compliance with requirements of the law is a commonplace of our jurisprudence and can scarcely of itself involve any overstepping of the bounds of judicial power. To qualify, by reference to the avoidance of "substantial injustice", the exercise of the wide discretionary power conferred by the words "as it thinks fit" introduces a concept with which courts are familiar and which does nothing to suggest a non-judicial function. By directing attention to the effect of a proposed order upon all those likely to be affected by it the Court is required to have regard to all the circumstances of the case. What was said by members of this Court in Cominos v. Cominos [6] is sufficient to answer the present attack upon s. 171C(2). I need do no more than refer to what was said in the joint judgment of McTiernan and Menzies JJ. [7] and in the judgments of Walsh J. [8] , of Gibbs J. [9] and of Mason J. [10] . My own reasons for judgment [11] express views which I regard as applicable in large measure to the present case.

(1972) 127 C.L.R. 588. 2. (1972) 127 C.L.R., at p. 591. 3. (1972) 127 C.L.R., at pp. 593-594. 4. (1972) 127 C.L.R., at pp. 599-600. 5. (1972) 127 C.L.R., at p. 608. 6. (1972) 127 C.L.R., at pp. 602-606.

No different considerations appear to me to apply to s. 171D; when the Court has made a declaration under sub-s. (1) of that section a situation is disclosed in which some part of a registered organization has ceased to exist or has become moribund; the rules of the organization are found to provide no solution but some efficacious remedy is called for; the traditional response of the law in such a case has been to do very much what sub-s. (2) provides for, to empower the Court to supervise a scheme for reconstitution of the defunct or moribund organization. In the fields of charitable trusts and of companies the same concept has been employed in exercise of power eminently judicial in character. It is said that the reference in s. 171D(1) to an organization having ceased "to function effectively" invokes broad considerations of industrial policy such as are referred to in the recitation of the chief objects of the legislation in s. 2 of the Act. I regard the reference to effective functioning as much more limited in scope; it is concerned with the performance, by the "part of the organization" which has been found wanting, of its function as such a part. Whether it is, in this sense, functioning effectively is a matter which is entirely within the scope of determination by the exercise of judicial functions. My general observations concerning s. 171C apply equally to s. 171D.

It is for the foregoing reasons that I reject the submission that either of these two sections involves the purported conferring of non-judicial power upon the Industrial Court. I would accordingly discharge the orders nisi applicable to these two proceedings.

There are before the Court five orders nisi made by Stephen J., all arising out of multifarious proceedings in the Australian Industrial Court, concerning the affairs of the Shop Distributive and Allied Employees' Association ("the Association"), an industrial organization of employees registered under the Conciliation and Arbitration Act 1904, as amended. In all but one of these proceedings final or interim orders were made by the Court relying upon the authority conferred by s. 141(1) and (2) of the Act. The prosecutors challenge the validity of a number of orders on various grounds, all of which, it is claimed, go to absence or excess of jurisdiction in the Court below and, accordingly, to attract relief by way of prohibition or certiorari. In the one case in which no order has yet been made prohibition or certiorari is sought on the ground that the Court below has no jurisdiction.

The prosecutors' argument in the main centres upon the provisions of s. 141 and ss. 171B, 171C and 171D which were introduced into the Act by the Conciliation and Arbitration (Organizations) Act No. 89 of 1974. Indeed, it was part of the prosecutors' case that ss. 171C and 171D are invalid in that they constitute an attempt to confer non-judicial power on a federal court contrary to the doctrine enunciated by the Boilermakers' Case [12] . By way of answer the respondents, apart from contending that the power conferred by the sections was judicial in character, submitted that the Boilermakers' Case was incorrect and should not be followed, this question being reserved for separate argument before the Court en banc.

We begin, then, with s. 141 which provides, so far as it is material:

(1) The Court may, upon complaint by any member of an organization and after giving any person against whom an order is sought an opportunity of being heard, make an order giving directions for the performance or observance of any of the rules of an organization by any person who is under an obligation to perform or observe those rules.

The judgments of this Court in R. v. Commonwealth Court of Conciliation and Arbitration; Ex parte Barrett [13] make it perfectly clear that sub-s. (1) of s. 141 is not confined to the making of orders directing the performance or observance of a particular rule or particular rules of the organization, as the prosecutors would have it, and that it extends, as its words explicitly state, to the giving of directions for the performance or observance of any of the rules of an organization, that is, for the doing of acts which will conduce to the performance or observance of such rules. The Court was there concerned with the provisions of s. 58E of the Commonwealth Conciliation and Arbitration Act 1904-1934 which conferred upon the Arbitration Court power to make an order "giving directions for the performance or observance of any of the rules of an organization by any person who is under an obligation to perform or observe those rules", the very words now contained in s. 141(1).

The power to make interim orders, given by sub-s. (2), is likewise not limited to the giving of directions to perform or observe rules. The terms of the grant to the Court of authority "to make such orders as it thinks fit in relation to the matters to which the proceedings relate" indicate that the Court has a wide discretion as to the form of order to be made. The exercise of this discretion cannot be restricted to the making of orders for the performance or observance of the rules, or for that matter to directions as to matters which will conduce to performance or observance of the rules. The history of sub-s. (2) suggests that in its present form it is designed to enable the Court to make any interlocutory order which will safeguard the position and interests of parties pending a final determination, provided that it bears a relationship "to the matters to which the proceedings relate". The judgments of this Court in Reg. v. Forbes; Ex parte Bevan [14] drew attention to the limitation attaching to the power to make interim orders given by sub-s. (2) in its then restricted form. Subsequently the sub-section was amended to overcome this limitation by Act No. 37 of 1972 which enacted the sub-section in its present form.

The only relevant limitation on the Court's power to pronounce an interim order is to be found in the concluding words of the sub-section. Yet they are not susceptible of the construction which the prosecutors seek to place upon them. It is impossible to read "the matters to which the proceedings relate" as signifying no more than the relief claimed by the applicant in the proceedings, or, for that matter, than the issues which are raised for decision in the proceedings. The words, we think, signify the controversy between the parties to which the proceedings relate, whether or not it be crystallized as an issue in these proceedings or in the form of the relief sought.

Before departing from s. 141 we should refer to the provisions of Pt IXA because the existence of these provisions was relied upon by the prosecutors as a ground for confining the power given by s. 141(2), this being yet a further ground of attack on two of the interim orders which were made. Part IXA - ss. 171A to 171G - contains a series of validating provisions. Section 171B validates all acts done in good faith by the collective body or officeholder of an organization or branch, notwithstanding the subsequent discovery of invalidity in his or its election or appointment or in the making or the alteration of a rule. Section 171C enables the Industrial Court to make orders in respect of the consequences of invalidity in the affairs of an organization, in particular orders rectifying, negativing or modifying the invalidity or validating any act, matter or thing rendered invalid (sub-s. (2)). Section 171D empowers the Court to approve schemes for the reconstitution of an organization or part of an organization which has ceased to exist or to function effectively and there are no effective means under the rules by which it can be reconstituted or enabled to function effectively. Section 171F validates certain acts done by the collective body or an office-holder of an organization or branch upon the expiration of four years from the doing of the act. Section 171G enables the Court to make an order, where it is satisfied that the application of s. 171B or s. 171F would cause substantial injustice having regard to the interests of the organization, its members or creditors or persons having dealings with it, that neither section shall apply to an act specified in the Court's declaration.

In seeking to circumscribe power to make interim orders conferred by s. 141(2) the prosecutors submitted that ss. 171B and 171C are to be viewed as a comprehensive and exclusive code on the topic of invalidity - except in so far as final orders under s. 141(1) are concerned - and that therefore no interim order can be made under s. 141(2) to restrain the commission of an act prima facie invalid or flowing from an invalidity where it appears that the invalidity or its consequences could be cured subsequently by an order under ss. 171B or 171C. The argument is plainly misconceived. It is a misnomer to describe the sections as a code exclusively applying to all invalid acts and their consequences. Indeed, so much is conceded by the acknowledgment that the two sections do not trench upon an exercise of the power to make a final order under s. 141(1). And once it is accepted that the sections do not diminish the power to make an order under sub-s. (1), there is no reason to think that they diminish the power to make an order under sub-s. (2) of s. 141. Sections 171B and 171C deal with acts of invalidity which have already taken place and the consequences of such acts; there is no reason to suppose that they displace the power to restrain, whether by final or interim order, the commission of an invalid act, original or consequential, which lies in prospect only. In relation to such acts and consequences s. 141(1) and (2) operate according to their full flavour. No doubt in deciding whether to make an order under s. 141(2) the Court will take into account the existence of the powers conferred by Pt IXA, but in no sense is this a displacement of the Court's jurisdiction or of its power to grant relief under s. 141(2).

The provisions of Pt IXA are remedial and alleviating. They enable the Court to relieve against invalid acts and their consequences. But it is too much to say that the existence of the sections circumscribes the Court's jurisdiction and power to compel performance and observance of the rules of an organization by interim, as well as final, relief.

The prosecutors argue that ss. 171C and 171D confer on the Industrial Court non-judicial power. The attack upon s. 171C was supported largely by reference to the provisions of pars (a) and (b) of sub-s. (2) of that section. They follow sub-s. (1) which empowers the Court, on the application of an organization, a member or a person having a sufficient interest in respect of it, to hear and determine the question whether an invalidity has occurred in the affairs of the organization and to make such declaration as it thinks proper. The sub-section provides:

6C. (2) Where, in proceedings under sub-section (1), the Court finds that an invalidity of the kind referred to in that sub-section has occurred, the Court -

(a) may make such order as it thinks fit to rectify or cause to be rectified the invalidity, or to negative, modify or cause to be modified the consequences in law of the invalidity, or to validate any act, matter or thing rendered invalid by or as a result of the invalidity;

(b) shall, before making such order, satisfy itself that such an order would not do substantial injustice to the organization or to any member or creditor of the organization or to any person having dealings with the organization.

It involves, so the argument runs, the conferment on the Court of functions which differ markedly from the ascertainment and declaration of existing rights, involving as they do, the making of determinations by reference to criteria not enunciated and the making of orders creating new rights. In addition, it is urged that the concept of "substantial injustice" is so vague as not to lend itself to an exercise of judicial power. These considerations, it seems to us, are not enough to bring us within reach of the conclusion which the prosecutors seek to attain. Many examples are to be found in the exercise of judicial power of orders which alter the rights of the parties or are the source of new rights. Likewise, there are countless instances of judicial discretions with no specification of the criteria by reference to which they are to be exercised - nevertheless they have been accepted as involving the exercise of judicial power (see Cominos v. Cominos [15] ). It is no objection that the function entrusted to the Court is novel and that the Court cannot in exercising its discretion call in aid standards elaborated and refined in past decision; it is for the Court to develop and elaborate criteria regulating the discretion, having regard to the benefits which may be expected to flow from the making of an order under sub-s. (2)(a) and the impact which such an order will have on the interests of persons who may be affected.

In the exercise of judicial power courts are called upon to decide whether particular transactions are invalid or unenforceable under the legislation relating to companies, money-lending and hire-purchase. Likewise they are frequently required to determine whether procedural steps taken in the course of legal proceedings have been validly or regularly taken. In each class of case the courts are empowered to relieve against invalidity, unenforceability or irregularity after having regard to any injustice, prejudice or hardship that may be caused by the making of such an order. This function, so it seems to us, is essentially an exercise of judicial power. Even if this were not so, the exercise of the power to grant relief must be regarded as incidental to the exercise of judicial power which is involved in the determination of the initial issue of invalidity, unenforceability or irregularity. For our part, we can perceive no real difference between these functions and the role thrust upon the Australian Industrial Court by s. 171C. The exercise of the power given by s. 171C(2), if not itself an exercise of judicial power (which in our opinion it is), is incidental to proceedings for a declaration of invalidity under sub-s. (1) which involves the exercise of such power.

It is a significant consideration, as the judgments in Reg. v. Davison [16] point out, that the function is entrusted to a court, at least in those cases in which the function cannot be clearly classified as administrative in character, and that it is the same as or essentially similar to functions which have hitherto been discharged by courts.

To our mind the present case should be distinguished from Reg. v. Spicer; Ex parte Australian Builders' Labourers' Federation [17] in which s. 140 of the Conciliation and Arbitration Act 1904-1956 was held invalid. Here the Court has a jurisdiction vested in it, exercisable on the application of a party; there the Court was given a power to act of its own motion. Here the jurisdiction conferred enables the Court to relieve against invalidity and its consequences, a function frequently undertaken by courts and not essentially dissimilar to that entrusted to courts under the companies, money-lending and hire-purchase legislation; there the power to disallow rules was a power which has been regarded as a non-judicial function.

True, it was said in that case that the discretion given by s. 140 was not a judicial discretion but was based "wholly on industrial or administrative considerations" (per Dixon C.J. [18] ) and involved "considerations of industrial policy" (per Taylor J. [19] ). We do not regard these observations as indicating that the mere requirement that a court take into account considerations of industrial policy in exercising a discretion is of itself enough to stamp that discretion with the character of a non-judicial function. The observations were made in a context in which there were other grounds supporting the conclusion reached by the Court.

(1957) 100 C.L.R., at p. 289. 2. (1957) 100 C.L.R., at p. 310.

In the result it may be said of s. 171C, as Barwick C.J. said of s. 143(2) of the Conciliation and Arbitration Act 1904-1973 in Reg. v. Joske; Ex parte Australian Building Construction Employees and Builders' Labourers' Federation [20] , that "The basis for the exercise of the discretion is specifically set out. It clearly partakes of judicial function: the weighing of the gravity of ascertained facts and decision upon the claims of justice."

Section 171D(1) enables the Court, on an application made by an organization, a member or any person having a sufficient interest in respect of it, to declare

(a) a part of the organization has ceased to exist or to function effectively and there are no effective means under the rules of the organization or branch by which it can be reconstituted or enabled to function effectively; or

(b) an office or position in the organization or in a branch of the organization is vacant and there are no effective means under the rules of the organization or branch to fill the office or position,

Sub-section (2) empowers the Court, once a declaration has been made, to "approve a scheme for the taking of action for the reconstitution of the branch or part of the branch, or of the collective body, or to enable it to function effectively, or for the filling of the office or position". The Court, before making an order, must satisfy itself that the order would not do substantial injustice to the organization or to any member (sub-s. (3)). An order or direction and any action taken in accordance with an order or direction has effect notwithstanding anything in the rules (sub-s. (5)).

Much of what we have said in relation to s. 171C has equal application to s. 171D. There is to our mind nothing in the issues which s. 171D(1) poses for decision that is alien to the exercise of judicial power. Such issues of fact as the question whether part of an organization has ceased to exist or to function effectively, whether there are effective means under the rules by which it can be reconstituted or enabled to function effectively, are issues of fact well suited to judicial determination. So also are the issues posed by par. (b) of sub-s. (1).

The principal point of attack made by the prosecutors was on the power given to the Court by sub-s. (2) to approve a scheme. Yet this is a power which is associated with a jurisdiction to make a declaration under sub-s. (1), a function which we have held to involve the exercise of judicial power. Whether a scheme will or is likely to (a) reconstitute a branch, part of a branch or a collective body, (b) enable any one or more of these entities to function effectively, (c) result in the filling of an office or position or (d) cause substantial injustice to the organization or any member are all issues which are susceptible to judicial determination in the exercise of the judicial power, as indeed is the evaluation of the considerations which may be thought to be relevant to the making of an order granting or refusing approval. To the extent to which the argument is an attack on sub-s. (3) it is sufficient for us to reiterate the observations which we have already made in connexion with s. 171C(2) (b).

Section 171D(1) entrusts to the courts a function similar to that which courts have undertaken in confirming schemes of arrangement under the Companies Act. These schemes often reconstitute the capital structure of a company and readjust the rights of creditors and shareholders. The jurisdiction thereby exercised, it should be acknowledged, involves the exercise of judicial power. Consequently, it is our opinion that the jurisdiction conferred upon the court by s. 171D is itself an exercise of judicial power.

We turn now to the structure of the Association and the sequence of events which generated the proceedings in the Industrial Court. The Association is a federal body having a branch in each State with provision under its constitution for the establishment of two additional branches one of which is the Northern Newcastle Branch in New South Wales. The branches have autonomy in the management of their affairs. Membership of a branch constitutes membership of the Association. Under the Association's rules branches are required to pay affiliation fees on or before 1st April in each year, the fees being calculated on the basis of the membership as it exists on the preceding 1st January. The management of the affairs of the Association is vested in a National Council which consists of a president, vice-president, secretary-treasurer, assistant secretary and delegates from the branches, the representation by delegates from each branch being proportionate to the number of its members. The National Council meets biennially in October. Between meetings of the National Council the affairs of the Association are administered by the national executive which consists of the president, vice-president, secretary-treasurer and three other members elected by and from the national council, with the provision that a branch not represented on the executive may elect one of its council delegates to the executive. The Council has power to change the rules and to fix affiliation fees. Non-financial members and branches are not entitled to privileges of membership.

The critical events commenced when at a meeting of the council on 12th October 1974 the then national secretary, Egan, was removed from office under r. 12(d) and was replaced by Goldsworthy, formerly the assistant secretary. Proceedings (No. 161 of 1974) were then taken by the respondents Egan and Davis, members of the organization, under s. 141 for an order for Egan's reinstatement and for a series of orders establishing that the members of the National Council (other than the New South Wales delegates) and some members of the national executive were not validly elected or appointed. A final order for the reinstatement of Egan was ultimately made but during the course of the proceedings and before any final order was made, the Court made an interim order deeming the New South Wales branch to be for all purposes a financial member of the Association for 36,741 members.

The prosecutors challenged this order on a number of grounds. In discussing s. 141(2) and its relationship with s. 141(1) and Pt IXA we have already said enough to dispose of the submissions that s. 141(2) only authorizes an order for the performance or observance of the rules and that the existence of Pt IXA operates to deny jurisdiction to make an order in this case. Other submissions made by the prosecutors now need to be considered. The first is that there is no power to make an order against an organization and that this was such an order. The objection is without substance. The order was an order binding on the parties requiring them to act in the affairs of the organization on the footing that the New South Wales branch was a financial member to the extent stated; it was not an order against the organization itself.

The other submissions are that the order was not sought by the applicants but by those respondents who represented the New South Wales branch against other respondents and that it was not commenced in the manner required by r. 70, namely by rule nisi. Again this submission is in our opinion misconceived. Once it is accepted that the power to make interim orders is wide enough to enable the Court to protect on an interim basis the interests of the parties, there is no reason to think that the Court cannot make an order which differs from the relief sought by the applicants, provided that the occasion for its making arises in the course of the proceedings and it answers the description contained in s. 141(2). The question then is whether the interim order relates to a matter to which the proceedings relate. This question should be answered in the affirmative. The relief sought in the proceedings called in question the membership of the branches other than the New South Wales branch, but in order to obtain the final relief sought the applicants needed to establish that the New South Wales branch was a member; unless this was so, the applicants were not entitled to relief. What was in controversy between the parties was the membership of the branches because on this depended the conduct of the Association's affairs and in particular the composition of the Association's delegation to a meeting of the Australian Council of Trade Unions, the composition of the delegation hinging on the outcome of the proceedings. Accordingly, the matter to which the proceedings related was the membership of the branches and the composition of the delegation. The interim order related to this controversy by providing an interim basis for performance or observance of the rules so as to enable the Association's affairs to be conducted and an appropriate delegation to be selected.

Rule 70 required that the proceedings should be commenced by rule nisi. Instead of obtaining a rule nisi the respondent O'Neill filed a document described as an application. No objection was taken to the informal mode of commencement by application and the Court made an order after hearing argument without attention being drawn to the existence of the formal defect. In our opinion the defect falls within r. 155(2) and is one which may now be overlooked. In any event, as it is a defect procedural in character it does not in our opinion go to jurisdiction (see R. v. Commonwealth Court of Conciliation and Arbitration; Ex parte Grant [21] ).

In the result we would discharge the order nisi relating to proceedings No. 161 of 1974.

In consequence of an election held by postal ballot for the National Council and other officers of the Association in 1974 questions arose as to the validity of the election. In proceedings No. 295 of 1975 the applicants sought in the Australian Industrial Court orders that certain national councillors of the Association cease to hold themselves out or recognize other respondents as national councillors of the Association. By way of interim relief under s. 141(2), orders were made against particular respondents requiring them to cease to hold themselves out or to recognize other respondents as national councillors. The validity of these orders was challenged by the prosecutors on the ground that by reason of the existence of the provisions of Pt IXA they were not authorized by s. 141(2) and also on the further ground that the order was not an order for the performance or observance of the rules. The prosecutors' submissions, therefore, do no more than raise questions already discussed and disposed of. The consequence is that the rule nisi in this Court (No. 109 of 1975) should be discharged.

The third proceeding in the Industrial Court (No. 300 of 1975) arose out of amendments to the rules of the Association made at a meeting of the National Council on 15th to 17th October 1975. In these proceedings the respondents in this Court alleged that the amendments were not validly made, in particular those amendments which related to the membership of the Newcastle and Northern branch, and they sought relief in connexion with these rules and in connexion with the enrolment of persons as members of the Newcastle and Northern branch pursuant to the amended rules. The proceedings were in fact adjourned but during the course of the proceedings an interim order was made requiring Tacon, the national secretary, to take no further steps to conduct, continue or complete the election for officers for the Newcastle and Northern branch pursuant to national r. 40. This order was challenged again on the ground that it exceeded the limited scope of s. 141(2), viewed in the light of Pt IXA, contended for by the prosecutors. This ground has already been discussed and disposed of. Consequently, the order nisi relating to this proceeding should also be discharged.

In the same proceedings, in response to a subpoena duces tecum, certain documents were lodged by the applicants in this Court with the Industrial Court. After argument an interim order was made on 28th November 1975 giving the respondents in the Industrial Court leave to inspect the documents "by Mr. Whalen or any other agent of the parties" and stating that the inspection would be under the supervision of an officer of the Court. Apart from grounds already discussed, that order was attacked on the ground that it fell outside the authority conferred by s. 187 which provides that "all books, papers, documents and things produced in evidence before the Court may be inspected by the Court or by such of the parties as the Court allows". This section deals with documents produced in evidence; it does not purport to deal with the inspection of documents produced under subpoena before their production in evidence. The section therefore provides no basis for relief by way of prerogative writ.

Finally, the applicants challenge the jurisdiction of the Industrial Court to entertain proceedings ( Nos. 301 and308 of 1975) in which the organization and some of the respondents sought declarations under s. 171C(2) of the invalidity of (a) certain rules and (b) validating orders. In addition orders under s. 171D approving a scheme were sought. The views which we have already expressed dispose of the contention put in support of the challenge that the sections operated to confer non-judicial functions on a federal court.

In the light of the conclusions which we have reached we do not find it necessary to consider the submission made at the subsequent hearing that the Boilermakers' Case [22] was incorrectly decided and we therefore refrain from expressing an opinion on it.

In the result, therefore, we would discharge the five orders nisi made by Stephen J.

At a glance

Court

Decision date

Before

Source

Judgment (87 paragraphs)

Parties