Conciliation and Arbitration Act 1904 ss. 140, 141, 170A

Industrial Relations Act 1988 ss. 221(1)(d) and 223(3)

Industrial Relations (Consequential Provisions) Act 1988 s.53

Counsel for the Transport Workers' Union of Australia: Mr M. Black QC and Mr S. Howells

Solicitor for the Transport Workers' Union of Australia: Ryan Carlisle Needham & Thomas.

Counsel for James Davis & Others: Mr P. Dalton QC and Mr S. Marshall

Solicitor for James Davis & Others: Maurice Blackburn & Co.

Counsel for the Australian Electoral Commission and the Returning Officer: Mr K. Bell.

Solicitor for the Australian Electoral Commission and the Returning Officer: Australian Government Solicitor.

THE COURT DECLARES that the following irregularities happened in relation to the elections for various offices in the Victorian Branch of the Transport Workers' Union of Australia:

(a) the purported direction of the returning officer to

the branch secretary of the Victorian Branch of the

Transport Workers' Union of Australia, by letter

dated 15th November 1988, was wrong in law, in that

it was not given to ensure that no irregularities

occurred in or in connection with the elections or

to remedy any procedural defects in the rules of

the Transport Workers' Union of Australia;

(b) the purported direction of the returning officer,

by letter dated 24th November 1988 to the branch

secretary of the Victorian Branch of the Transport

Workers' Union of Australia, and by newspaper

advertisement on 28th November 1988, cancelling

29th November 1988 as the date for closing

nominations, was wrong in law, in that it was not

given to ensure that no irregularities occurred in

or in connection with the elections or to remedy

any procedural defects in the rules of the

Transport Workers' Union of Australia;

(c) the returning officer wrongly refused to accept

the nominations of:

(i) Gary Ross Newman for the offices of

committee man and organiser;

(ii) Rex John Hore for the office of committee

man;

(iii) Barry Raymond Agg for the offices of

federal councillor, committee man and

organiser;

(iv) Darren Mark Crump for the offices of

committee man and organiser; and

(v) Allen Robert Worley for the office of

federal councillor;

nomination of Lee Robin Farmer for the office of

organiser.

Being satisfied that the irregularities may affect the results of the

(a) in the exercise of its discretion, declines to make

any order in respect of the irregularities referred

to in 1(a) and (b);

arrangements for the completion of the elections,

upon the basis that:

(i) Gary Ross Newman is a candidate for the

offices of committee man and organiser;

(ii) Rex John Hore is a candidate for the office

of committee man;

(iii) Barry Raymond Agg is a candidate for the

offices of federal councillor, committee man

and organiser;

(iv) Darren Mark Crump is a candidate for the

offices of committee man and organiser;

(v) Allen Robert Worley is a candidate for the

office of federal councillor; and

(vi) Lee Robin Farmer is not a candidate for the

office of organiser.

THE COURT ORDERS that the operation of rule 33(q) of the rules of the

Transport Workers' Union of Australia be modified so that persons elected take office immediately upon being declared elected.

THE COURT ORDERS that the application for an order that James Davis not continue to act in the office of branch secretary of the Victorian Branch of the Transport Workers' Union of Australia is dismissed.

Note: Settlement and entry of orders is dealt with by O.36 Federal Court Rules.

In a previous judgment, delivered on 18th May 1989, the Court dealt with one irregularity alleged to have happened in elections for various offices in the Victorian branch of the Transport Workers' Union of Australia ("the Union"). The formal matters relating to the institution of this inquiry into those elections, and the law pursuant to which the inquiry is conducted, are set out in that judgment, and need not be repeated. Between 22nd and 26th May 1989, the Court heard evidence and argument directed to the remaining irregularities alleged in the inquiry. These aspects can be dealt with conveniently under separate headings.

2. Rule 22(a)(I) of the rules of the Union provides, so far as is relevant:

"...a person shall not be eligible to nominate

for any office in the Union or any Branch or

Sub-Branch of the Union unless, at the date of

close of nominations for election to such

office he or she is:-

(i) a financial member of the Union, and

(ii) either is employed in the industry in

connexion with which the Union is

registered and in respect of such

employment is entitled to membership of

the Union pursuant to Rule 4, or is a

person holding office as Federal

Secretary, Federal Assistant Secretary,

Branch Secretary, Branch Industrial

Research Officer or Organiser (whether

elected or appointed) or as organiser

appointed by Federal Council or Federal

Committee of Management."

Rule 4 of the Union's rules, which contains its conditions of eligibility for membership, need not be set out in full. In substance, it provides that the Union shall consist of an unlimited number of persons "employed or seeking to be employed" in or in connection with certain industries, occupations, callings, vocations or industrial pursuits, including the transport of persons, passengers, goods, wares, merchandise or any material whatsoever, by or on vehicles, and "all driving". For the purposes of the rule, a person is deemed to be employed in one or more of the specified industries, occupations, callings, vocations or industrial pursuits, if his or her usual occupation is that of an employee in one or more of the specified industries, occupations, callings, vocations or industrial pursuits.

3. After nominations had closed, the returning officer received from the secretary of the Victorian branch of the Union, James Davis, a statutory declaration made on 19th January 1989. In that statutory declaration, Mr. Davis declared that, according to the evidence and documents before him, five candidates for various positions were independent contractors and to his knowledge had never become eligible for membership of the Victorian branch of the Union. The five candidates concerned were Rex John Hore, Darren Crump, Barry Raymond Agg, Gary Ross Newman and Allen Robert Worley. The returning officer had previously received from these five persons submissions, in which it was claimed that they were eligible to be members of the Union in its Victorian branch. The returning officer took the view that he was not in a position to dispute what was said in Mr. Davis's statutory declaration. He had no means of carrying out an investigation into the status of the candidates concerned. He therefore rejected the nominations of the five, for each of the positions for which they had been nominated, on the ground that they did not comply with the provisions of rule 22(a)(I)(i) of the rules of the Union, because they were not members of the Union. The question arose in the inquiry whether these candidates' nominations had been rejected validly. The applicant, for whom Mr. Borenstein of counsel appeared, undertook the burden of establishing not only that Messrs. Hore, Crump, Agg and Newman had been eligible to be members when they joined the Union, but also that they had retained their membership, and complied with the provisions of rule 22(a)(I)(ii) by being employed in appropriate positions at the date of closing of nominations. Mr. North of counsel appeared for Mr. Worley as an intervenor in the inquiry, and sought to establish Mr. Worley's eligibility to be a member, and compliance with rule 22(a)(I) in all respects. These claims were resisted by Mr. Dalton QC and Mr. Marshall of counsel, who appeared on behalf of Mr. Davis and others, including the other members of the committee of management of the Victorian branch of the Union. Mr. Bell of counsel appeared for the returning officer, and did not take sides on the issue. Mr. Black QC and Mr. Howells of counsel appeared for the Union, and made helpful submissions on the rules and on certain aspects of the law, without becoming involved in factual questions which were in dispute.

4. The returning officer accepted nominations from two other persons, namely Patrick Thomas Power and Stephen Paul Roach. The validity of the acceptance of these nominations was challenged by Mr. Dalton and Mr. Marshall, on the ground that they were not employees, and therefore could not comply with rule 22(a)(I). Mr. Borenstein contended for the validity of these nominations. Again, counsel for the Union confined themselves to submissions on the rules and the law. Mr. Bell and Mr. North did not enter the controversy in relation to Messrs. Power and Roach.

5. Messrs. Hore, Crump, Agg, Newman and Worley were all characterised as "owner-drivers", either when they were purportedly admitted to membership of the Union, at the time when nominations closed, or at some intervening times. The Court was therefore compelled to resolve the difficult question whether they were employees or independent contractors. With respect to Mr. Power and Mr. Roach, the question was somewhat different. They were taxi drivers at relevant times, and the question to be decided was whether the relationship between them and the owners of the taxis which they drove was characterised correctly as a relationship of employer and employee, or as a relationship of bailor and bailee.

6. Mr. Dalton relied heavily on the proposition that the four major Australian cases in which the factor of ownership of trucks was present have resulted in determinations that the truck owners concerned were not employees, notwithstanding the presence of some other factors which may have tended to show the existence of employment relationships. The four cases are Humberstone v. Northern Timber Mills [1949] HCA 49; (1949) 79 CLR 389, Wright v. Attorney-General for the State of Tasmania [1954] HCA 26; (1954) 94 CLR 409, Barro Group Pty. Ltd. v. Fraser [1985] VicRp 59; (1985) VR 577 and Stevens v. Brodribb Sawmilling Co. Pty. Ltd. (1986) 160 CLR 16. Further, reference was made to the English case of Ready Mixed Concrete (South East) Ltd. v. Minister of Pensions and National Insurance (1968) 2 QB 497, in which the factor of truck ownership was again present, and the decision was against the existence of an employment relationship. Although the consistency of results in those cases was relied upon, it was not contended that the fact that a person is the owner of a truck will lead necessarily to the conclusion that that person cannot be a party to a contract of employment with another person for whom the truck owner carries goods. The authorities themselves do make it clear that a balancing exercise is always involved in the determination whether an employment relationship exists.

7. Reference was made on numerous occasions during argument to an often cited passage from the judgment of Dixon J. (as he then was) in Humberstone, at pp 404-405, where his Honour said:

"For a case like the present, the test of the

existence of the relation of master and

servant is still whether the contract placed

the supposed servant subject to the command of

the employer in the course of executing the

work not only as to what he shall do but to

how he shall do it. The regulation of

industrial conditions and other laws have in

many respects made the classical tests

difficult of application and it may be that

ultimately they will be re-stated in some

modified form: cf. per Lord Thankerton, Short

v. Henderson ((1946) 174 LT 417, at p 421;

62 TLR 427, at p 429). But the present

case is free from such difficulties.

The question is not whether in practice the

work was in fact done subject to a direction

and control exercised by an actual supervision

or whether an actual supervision was possible

but whether ultimate authority over the man in

the performance of his work resided in the

employer so that he was subject to the

latter's order and directions. In the present

case the contract by the deceased was to

provide not merely his own labour but the use

of heavy mechanical transport, driven by

power, which he maintained and fuelled for the

purpose. The most important part of the work

to be performed by his own labour consisted in

the operation of his own motor truck and the

essential part of the service for which the

respondents contracted was the transportation

of their goods by the mechanical means he thus

supplied. The essence of a contract of

service is the supply of the work and skill of

a man. But the emphasis in the case of the

present contract is upon mechanical traction.

This was to be done by his own property in his

own possession and control. There is no

ground for imputing to the parties a common

intention that in all the management and

control of his own vehicle, in all the ways in

which he used it for the purpose of carrying

their goods, he should be subject to the

commands of the respondents."

It is not easy to discern from this passage the precise principle upon which Dixon J. came to the conclusion that the driver the subject of that case was an independent contractor. His Honour started out by stating that he was applying what became known as the "control" test; he explained the nature of this test, but does not appear to have applied it. Instead, he embarked on an inquiry as to what was the essence of the particular contract, found that it was "mechanical traction", and distinguished this from the essence of a contract of service, which he described as "the supply of the work and skill of a man". He then referred to the absence of any ground for "imputing to the parties a common intention" that one was to have the requisite control of another.

8. This process of reasoning demonstrates the essential weakness of the "control" test. Unless in a particular case it was an express term of a contract that one party should have the right to control the manner of the performance of work of another, the application of the "control" test was of little, if any, practical assistance. Indeed, the application of the test involved circularity. A contract of employment existed if there was the right to exercise the requisite control. It was only possible to find an implied term giving that right, or to impute to the parties a common intention that there should be control, if the contract were found to be a contract of employment. Thus, in reality, the search was for other factors which would enable a determination of whether the contract was one of employment. The attempt to interpose in this process a search for the existence of a term, or an imputed intention, as to the right to control only obscured the true nature of the process.

9. The practical application of the control test in some cases also tended to make nonsense of that test. It came to be recognised that there were some cases in which the skill of the person performing the work so surpassed the understanding of the person for whom the work was being performed that any attempt to exercise a right of control would have been regarded by both parties as an unwarranted interference. A hospital administator would hardly be expected to tell a brain surgeon how to perform operations. Nor would a circus proprietor normally be in a position to give directions as to the manner of performance of the work of a trapeze artist. See Zuijs v. Wirth Brothers Pty. Ltd. [1955] HCA 73; (1955) 93 CLR 561. Despite these difficulties, the courts tended to emphasise "lawful authority to command so far as there is scope for it." See Zuijs at p 571, in the joint judgment of Dixon CJ., Williams, Webb and Taylor JJ.

10. Difficulties of this kind with the application of the "control" test led to an attempt in England to replace it by an inquiry whether one party to a contract was part and parcel of the organisation of the other party. This "organisation" test was stated by Denning LJ. in Stevenson Jordan and Harrison Ltd. v. MacDonald and Evans (1952) 1 TLR 101, at p 111 and Bank Voor Handel En Scheepvaart N.V. v. Slatford (1953) 1 QB 248, at p 295. In reality, however, the "organisation" test played a role similar to that played by the "control" test, namely distracting attention from the true purpose of the investigation. If the question whether one person was part of the organisation of another was to be answered by reference to a number of factors, and to where the balance of those factors lay, and if a positive conclusion led automatically to the proposition that the contract was one of employment, there was no reason why the "organisation" step should not be removed from the process of reasoning.

11. When the question came before the High Court of Australia most recently in Stevens, the Court recognised the futility of attempting to interpose in the process of determination a question which depended simply upon the assessment of factors which would themselves provide the conclusion to the principal question, at the same time as answering the interposed one. The most important judgment was that of Mason J. (as his Honour then was), with whom both Brennan J. and Deane J. agreed on this issue. At p 24, Mason J. referred to the "control" test and said:

"But the existence of control, whilst

significant, is not the sole criterion by

which to gauge whether a relationship is one

of employment. The approach of this Court has

been to regard it merely as one of a number of

indicia which must be considered in the

determination of that question:... Other

relevant matters include, but are not limited

to, the mode of remuneration, the provision

and maintenance of equipment, the obligation

to work, the hours of work and provision for

holidays, the deduction of income tax and the

delegation of work by the putative employee."

At pp 27 and 28, his Honour discussed the "organisation" test. While accepting the relevance of the test, his Honour rejected its use as a criterion for determining a legal issue or legal liability, regarding control as a more important factor. There is also an important passage in the joint judgment of Wilson and Dawson JJ., in which their Honours rejected both the "control" test and the "organisation" test as tests which could be used to determine the question, whilst accepting the relevance of both factors. At p 35, their Honours said:

"The modern approach is, however, to have

regard to a variety of criteria. This

approach is not without its difficulties

because not all of the accepted criteria

provide a relevant test in all circumstances

and none is conclusive. Moreover, the

relationship itself remains largely undefined

as a legal concept except in terms of the

various criteria, the relevance of which may

vary according to the circumstances."

At p 36, their Honours said that, "In many, if not most, cases it is still appropriate to apply the control test in the first instance because it remains the surest guide...".

12. In the present case, Mr. Black argued for the application of yet another single test, namely whether persons performing work belong properly on the side of labour, rather than on the side of capital, in disputes or negotiations as to their working conditions. In order to answer this question, however, it would be necessary to balance the various factors which determine the nature of the contract. If such an exercise needs to be undertaken, then in undertaking it the Court should concentrate on the end of the process, rather than upon an intermediate stage. In other words, to apply a test such as that proposed by Mr. Black would be merely to substitute it for the "control" test or the "organisation" test in the process of determining the ultimate issue. Naturally, the manner in which working conditions for an owner-driver have been fixed will be relevant to the determination whether that owner-driver is an employee or not. It will, however, be only one of many factors to be considered.

13. A Court determining whether a particular relationship is that of employment or of some other kind can therefore only resort to the process of balancing all of the factors, or as they are called in Stevens and other cases, the "indicia". In truth, the result may be a matter of impression. It is unfortunate that this is so. It should not be necessary for people to obtain a decision of a court, in order to know the true nature of their relationship. Unfortunate or not, that is the case. Although the parties are free, as a matter of law, to choose the nature of the contract which they will make between themselves, their own characterisation of that contract will not be conclusive. A court will always look at all of the terms of the contract, to determine its true essence, and will not be bound by the express choice of the parties as to the label to be attached to it. As Mr. Black put it in the present case, the parties cannot create something which has every feature of a rooster, but call it a duck and insist that everybody else recognise it as a duck.

14. As is indicated by the passages in Stevens to which I have referred, there is no prescribed list of factors which will be examined in determining whether a contract is one of employment. Any circumstance which may shed light on the nature of the contract will be taken into account. Some difficulty may arise where the practical constraints on a party conflict with the express stipulations in the contract. For instance, a party may be described as an independent contractor, and the contract may even provide expressly that he or she is at liberty to provide services to other persons, outside of the contract. The reality may be that economic considerations dictate that work will only be accepted from the other party to the contract. There was evidence in the present case to the effect that, for practical purposes, an owner-driver who is heavily indebted to a finance company for the hire purchase of a truck is less independent than a person who is employed to drive a truck owned by the employer. The employee driver may leave and seek a job driving any sort of vehicle with any other employer. The owner-driver must be assured of a steady supply of work in order to keep up payments in respect of the truck, and can only take work for which the particular truck is suitable. There is also evidence that, in some cases, owner-drivers are reluctant to exercise the notional freedom which they may have to refrain from presenting themselves for work on particular days at their own choice. Evidence was given of a practice of withholding work from owner-drivers for some periods, by way of reprisal for their failure to attend and perform services as desired. In such circumstances, there is no particular reason why a court should ignore the practical circumstances, and cling to the theoretical niceties. The level of economic dependence of one party upon another, and the manner in which that economic dependence may be exploited, will always be relevant factors in the determination whether a particular contract is one of employment.

15. In many respects, the balancing of various factors once they are assembled is difficult. This is because many of the factors commonly relied upon prove to be of insubstantial weight upon proper analysis. For instance, a factor relied on commonly is whether or not income tax is deducted from the remuneration of a person before being paid to him or her. In the present case, reliance was placed on the fact that tax was deducted at the rate of fifteen per cent of the gross earnings of some owner drivers, pursuant to the prescribed payments scheme. No instalments of income tax were deducted from the remuneration of those persons under the pay as you earn taxation system. To place heavy reliance on this factor, however, is to assume that the payer has acted in accordance with the requirements of income tax legislation in choosing one type of deduction, rather than another.

16. Perhaps the major factor on which Mr. Dalton placed emphasis in respect of each of the owner drivers was that of ownership of a truck. This was said to make the essence of each of the contracts into which the owner-drivers entered the provision of "mechanical traction", as was said by Dixon J. in Humberstone. There are many persons who perform work for others, undoubtedly in the capacity of employees, and who provide their own equipment for the purpose of performing such work. A carpenter, plumber, electrician or butcher may provide tools of trade, without that provision being regarded as a conclusive factor, or even a major factor, against their being parties to contracts of employment. The essence of Mr. Dalton's argument on this point seemed to be that the amount of capital invested in a truck was so great that its owner or hire-purchaser should be regarded as having undertaken a business in his or her own right. It was this level of capital investment which was said to distinguish an owner-driver from a tradesman providing tools. The distinction is not obvious. There are cases of tradesmen who operate their own businesses. The plumber who is available for hire to various householders, to perform maintenance and installation work is an example. Ordinarily, that tradesman will provide his or her own tools. Equally, a plumber may be engaged on a building site for a long period as an employee, still providing his or her own tools. A person who owns a truck might trade as a common carrier, carting goods for anyone who wishes to hire his or her services. There seems to be no reason in principle why an owner-driver should not also be engaged on a longer term contract for one person, carting only the goods of that person, and as an employee. The amount of capital invested in a truck may vary widely, depending on factors such as the size and age of the vehicle, and the purpose for which it has been designed. Ownership of a truck may result from nothing more than the reality that it is easier to obtain work by owning one than by offering oneself as a driver of vehicles owned by others. The reality is that there are those who seek to avoid the responsibility for the capital cost of trucks by casting it on to those who actually drive the trucks, and perform carrying services for them. No doubt in fixing the remuneration of an owner-driver, there will be recognition of the owner-driver's responsibility for the capital cost of the truck. So also might a tool allowance in an award recognise an employee tradesman's responsibility for the provision of tools.

17. The social position of a person owning a truck is likely to be viewed very differently now from 1949, when Humberstone was decided. The enormous increase in the ownership of motor vehicles generally, and the common occurrence of vehicle ownership amongst persons who use their vehicles to earn their livings, are likely to have changed the perceptions of many people as to the "capitalist" status of a truck owner. It is true that the amounts of money required to purchase a large truck nowadays may be correspondingly larger than in 1949. There is, however, something rather strange about a legal principle being dependent upon the size of the money involved. The characterisation of the relationship between a person carrying goods and the person providing the carriage work should not depend on whether the former is driving a large and expensive truck, a small van, a motor cycle, or even a bicycle.

18. Other factors which have been relied upon in past cases may prove to be even more insubstantial upon examination. Mr. Dalton argued that the liberty of an owner-driver to seek work elsewhere on a day to day basis was an important factor. Such liberty, however, may be no more important than the same liberty of a casual employee, to seek work from other employers, or even to carry on a business, when not required to work by his or her employer. Mr. Dalton also emphasised the choice that many persons make to own a truck, as a means of increasing their remuneration. This was said to be a decision to go into busines, involving the application of capital, and coupled with an entrepreneurial spirit, a pride in independence, and a professionalism in work. Often, however, the exercise of a choice to own a truck may be no more significant than a change of job to one that pays more. Indeed, practical circumstances may dictate ownership, as a means to what is a higher paid job. It is clear that none of the owner-drivers in the present case had any business in the sense that he could have sold it, including any goodwill. The absence of goodwill is a factor to be taken into account, although it is not conclusive. See Australian Mutual Provident Society v. Chaplin (1978) 18 ALR 385, at pp 393-4.

19. Before turning to the individual cases, reference should be made to one further general matter. There was tendered in evidence a document described as "an agreement between the Victorian Road Transport Association and the Transport Workers' Union of Australia Victorian Branch". Each side sought to gain comfort from this agreement, although its precise status is unclear. By its own terms, the agreement "shall be binding upon the Transport Workers' Union of Australia, Victorian Branch, its officers and members; and members of the Victorian Road Transport Association in respect of Owner/Driver Sub-contractors who are engaged by a Prime Contractor member of the Association in the State of Victoria." In this and other respects, the agreement adopts terminology which is similar to that used in many industrial awards, although the agreement appears to have no statutory or other force. It is intended to lay down terms and working conditions for persons who fall within its terms. Of particular interest is the definition of the "Sub-contractor" in clause 1(e), which is as follows:

"The Sub-contractor shall mean any Owner

Driver Sub-contractor who supplies and drives

his own vehicle and who does not employ

another Driver except in such circumstances as

during Sickness or Annual Leave. He must be

captive to a particular Transport Company and

be under either a verbal or written contract

and devote himself in a permanent capacity to

the operational requirements of the Company."

20. The agreement contains a number of terms which suggest that those whose terms and conditions of work it covers are not employees. Not the least of them is clause 9(a), which provides expressly that the sub-contractor is an independent contractor and shall not hold himself out as an employee of the prime contractor. Not surprisingly, the agreement provides for the sub-contractor to provide, maintain, register and ensure a vehicle suitable for the carriage of goods, and to be responsible for its safe loading. A sub-contractor who employs any other person is responsible for insuring against Workcare claims. The sub-contractor is also responsible for public risk insurance, in the joint names of the sub-contractor and the prime contractor. Premiums for public risk insurance are paid by deduction by the prime contractor from the sub-contractor's remuneration. Among the obligations of a sub-contractor are what are described as "professional obligations". These include prompt advice to the prime contractor of inability to perform or unreasonable delay in performance of obligations, carrying out reasonable requirements of the clients and customers of the prime contractor in connection with the loading and unloading and carriage of goods, advising the prime contractor if the vehicle or any goods are involved in an accident or suffer damage, and using best endeavours to protect and advance the goodwill of the prime contractor. A sub-contractor is also obliged to ensure that any person employed by him to drive the vehicle has a driver's licence. The sub-contractor is required to maintain a personal accident insurance policy. Another significant provision is that, in the event of delay, the prime contractor has the right to transfer goods from the vehicle of the sub-contractor and to complete the contract at the sub-contractor's expense.

21. There are also several provisions of the agreement which suggest that the relationship is one of employment. There are many provisions relating to remuneration, which is fixed at an hourly rate, calculated by reference to fixed vehicle costs, variable vehicle costs and labour. There is provision for minimum payment and for overtime rates. The agreement lays down a procedure for settlement of disputes, which involves delegates and officials of the Union. The sub-contractor is obliged to "carry such goods as the Prime Contractor shall from time to time specify at such times and between such places as the Prime Contractor may reasonably require". Refusal to carry goods may only take place if in the opinion of the sub-contractor the goods are unsuited for carriage in or on the vehicle, or their carriage may result in a breach of the law. Any two way radio installed in the vehicle will be at the prime contractor's expense. The sub-contractor is required, at the expense of the prime contractor, to paint and decorate the vehicle and to affix signs and devices to it, as required by the prime contractor. It is not open to a sub-contractor to substitute another driver, or another vehicle, at his or her own whim. Substitution of a driver can only occur if the sub-contractor is prevented by sickness, disability or other urgent cause from driving the vehicle, notice is given to the prime contractor, and the prime contractor approves the substitute driver. Similarly, a substitute vehicle can only be used as a result of breakdown or accident, and must be approved by the prime contractor. If a uniform is required, it is to be supplied by the prime contractor at no cost to the sub-contractor. The prime contractor is given a right to "stand down" any sub-contractor if the vehicle does not meet requirements as to appearance; two weeks' notice of intention to stand down must be given, and a Union representative must be notified. There are detailed provisions as to termination of service by the prime contractor, different periods of notice being fixed, depending upon the cause of termination. There is also provision for retrenchment, involving the principle of "last on first off". Financial membership of the Union is a requirement. Provision is made for annual leave, the cost of which is to be borne by the sub-contractor.

22. As I have said, the exact effect of this agreement is unclear. It is purportedly made by the Victorian branch of the Union, but it is clear that a branch of a registered organisation does not have legal personality, or capacity to enter into an agreement. The agreement is purportedly binding on the members of the Victorian Road Transport Association, and the members of the Victorian branch of the Union. It does not give any indication on its face of having been entered into by any person as agent for any of those members. It therefore appears to have no binding legal effect, except insofar as its terms may be incorporated into individual contracts between owner-drivers and transport operators. If it were clear that the terms of the agreement, and only those terms, were applicable between a particular owner-driver and another person or company, I should be of the view that the balance of factors in the agreement would indicate that the owner-driver would be an employee. Factors such as the control which the prime contractor has with respect to goods, times and places, the nature of the remuneration, the provisions relating to stand down, termination and retrenchment, the involvement of the Union and the provision for annual leave seem to outweigh the other factors, including those concerned with ownership of the vehicle, so as to suggest that the relationship contemplated is one of employment. Indeed, if this were not so, one might well query the purpose of the agreement itself. An owner-driver would normally contract at the best rates and on whatever conditions he or she could obtain, if truly independent, and not "captive" as the agreement contemplates. It is not the case, however, that any of the owner-drivers the subject of the present proceeding were engaged purely on the basis of the terms of the agreement. It is now necessary to examine the particular cases in issue.

23. Gary Ross Newman joined the Union in 1983. At the time, he was working for a transport operator called Golden Brothers, driving a vehicle owned by that company. He was paid what he described as "wages", from which income tax had been deducted under the pay as you earn scheme. There is no real dispute that Mr. Newman was eligible to join the Union at the time when he joined it. The issue is whether he subsequently became ineligible to be a member. After joining the Union, he had several jobs for other transport operators, in which his working conditions were similar to those at Golden Brothers. On 5th August 1988, he began working for Greens Distribution Ltd. ("Greens"), another transport operator. This time, his working conditions were different.

24. There was in evidence a document entitled "Sub-contractors Agreement", made between Greens and Mr. Newman and dated 17th November 1988. The terms of this agreement should be set out:

"2. This agreement should be read in

conjunction with the current V.R.T.A. -

T.W.U. Agreement (as amended from time to

time) and is not intended to override any

matters contained therein.

3. All sub-contractors are required to fill

out an employment application form and be

aware of their obligations to be

financial members of the Transport

Workers Union of Victoria and the T.W.U.

Superannuation scheme.

The Sub-contractor agrees:

4. To supply a unit in acceptable condition

and colour and to allow the Company to

decorate or identify the vehicle with the

Company by use of transfers as required

and by mutual agreement.

The unit shall at all times be kept in a

roadworthy condition and have a

presentable appearance and the driver

should dress in a presentable and

appropriate manner.

5. To work as directed by authorised

employees of the Company with proper

diligence and despatch.

6. If using Company owned trailers and or

equipment (sic) To use the trailer and

equipment only for the carriage of goods

as instructed by the Company.

7. To be responsible for damage to tyres,

tubes, light globes, lens, wiring damage

or wear caused due to carelessness,

negligence or accident damage.

8. To replace at his cost any lamps,

brackets, bolts and nuts, ropes,

tarpaulins or any other equipment

including two-way radio equipment

supplied by the Company should they

become lost or stolen whilst in use by

the Sub-contractor and due to the

Sub-contractors negligence.

9. To be responsible to ensure that at all

times the unit or trailer is in a

roadworthy condition and report any

defect to the maintenance department for

repair. Should the matter not be

reported the Sub-contractor will be

responsible for any costs and penalties

incurred. Should any defect be reported

(in writing) and not actioned the

Sub-contractor is not responsible.

10. Should a mobile radio be fitted to the

Sub-contractors (sic) truck and operate

on the Company frequency the

Sub-contractor shall use same for the

purposes of Company Business only.

The radio is the Company's property and

it is the duty of the Sub-contractor to

protect this investment.

11. To be responsible at the termination of

the Agreement or breaking of this

Agreement, to return the trailer or

equipment in good condition to the

Company premises (allowing in all cases

for fair wear and tear to equipment).

12. Failing to do this, he will be

responsible for all costs in recovering

the trailer and equipment and for

replacing parts or rectifying any damage

incurred.

13. That one and one half percent shall be

deducted from the Sub-contractors (sic)

gross earnings for the insurance of goods

carried and to shipping containers.

Should the Sub-contractor hold a current

fully comprehensive insurance policy with

an approved insurer a copy should be

provided to the Company and no deduction

will be made.

14. Insurance - Public Risk

The Sub-contractor should take out a

Public Risk Insurance Policy to indemnify

Greens Distribution Limited and himself

with an approved insurer as stipulated in

the V.R.T.A. - T.W.U. agreement, clause

7, Item K (Page 23) and provide evidence

of this to Greens Distribution Limited.

The Company Agrees:-

15. To register and insure the trailer but

the Sub-contractor to pay for any damage

caused by his negligence.

16. All such equipment shall be on loan to

the Sub-contractor and shall remain the

property of the Company.

17. This document contains the entire

Agreement of the parties and shall not be

amended except by prior written consent

of the parties.

18. This shall not affect the right of the

Company to dismiss any Sub-contractor

without notice for malingering,

inefficiency, neglect of duty or

misconduct and in such cases all monies

due shall be paid to the Sub-contractor

within the normal payment period."

This agreement is very difficult to construe. Clause 2 is puzzling in the extreme. The V.R.T.A. - T.W.U. agreement referred to is the agreement which I have already described as having been entered into between the Victorian Road Transport Association and the Union's Victorian branch. The words chosen in clause 2 are not apt to make the terms of that agreement part of the agreement between Greens and Mr. Newman. Indeed, clause 17 seems to suggest that no terms other than those contained in the document are terms of any agreement between Greens and Mr. Newman. With this in mind, the statement that the sub-contractor's agreement is not intended to override any matters contained in the V.R.T.A. - T.W.U. agreement is obscure in its meaning. As the V.R.T.A. - T.W.U. agreement has no force and effect as between Greens and Mr. Newman, it is inevitably overridden by a specific agreement between those two parties, especially one which contains a clause like clause 17. It may be that clause 2 is intended only to be a guide to the proper construction of the agreement, so that in the event of ambiguity it should be construed in conformity with the V.R.T.A. - T.W.U. agreement. If this is so, no real difficulty arises.

25. In accordance with his obligations in his agreement with Greens, Mr. Newman supplied a vehicle in the form of a prime mover. He acquired the vehicle from an owner-driver who had previously carried for Greens. The purchase price was $28,000, and the acquisition was financed by a hire-purchase agreement into which Mr. Newman entered. He was responsible for all expenses of running the truck, including fuel, oil, tyres, light globes, parts and service and maintenance. Where items such as fuel and oil were supplied by Greens, these were deducted each week from Mr. Newman's remuneration. Deductions for these matters were substantial. It was Mr. Newman's practice to invoice Greens each week, the invoice showing the number of hours between his starting and finishing times on the various days of the week. From the total number of hours there was deducted half an hour per day for a lunch break. In one week, the rate for the total number of hours at the rate of remuneration, which was fixed as a flat rate per hour, amounted to $1800 for the week. Mr. Newman estimated that expenses of approximately $1300 would come out of this amount, including income tax, which was deducted at the rate of fifteen per cent of gross earnings under the prescribed payments scheme. Some emphasis was placed by Mr. Dalton on Mr. Newman's status as Mr. Newman saw it. In his nomination form for office within the Union, he described himself as "owner-driver". He gave evidence that, after working as a driver of trucks owned by others, he "decided to buy a truck to get a little bit extra money in to try and help pay the house." This was said to be evidence that he regarded himself as in business independently. It was coupled with his description in the agreement between Mr. Newman and Greens as a "sub-contractor".

26. Against these factors must be set a number of others. The most important is clause 5 of the agreement between Mr. Newman and Greens, which seems to provide Greens with the authority to exercise complete control over the manner of performance of work by Mr. Newman, if it chose to do so. Coupled with this is clause 18, which assumes the existence of a right which an employer would normally have to dismiss an employee in certain circumstances. The evidence is that, in practice, Mr. Newman was the subject of regular direction as to what he was to do. In evidence he said:

"Well, you reported for work in the morning.

They allocated you a job, and you went and did

it, and at the completion of that job you rang

in or called up on a two-way radio and

received another job."

Mr. Newman in fact carried and continues to carry only for Greens. A representative of Greens has emphasised to him the need to be reliable, and his understanding is that if he did not turn up for work one morning, he would not have a job. He conceded in cross examination that in theory he might decline to take particular jobs, but in practice he considered that it would endanger his continued relations with Greens if he did so.

27. Although he owns his prime mover, Mr. Newman does not and has not at any stage owned a trailer. His prime mover is used to tow trailers owned by Greens. Transfers have been applied to the prime mover, so that it bears the name of Greens, with Mr. Newman's name appearing only on the fuel tank. In normal circumstances, unless Mr. Newman desires to work on his prime mover, it remains overnight in a depot occupied by Greens. The transfers on the truck and its location at the Greens depot are substantial practical barriers to Mr. Newman looking for work from any other source if none is available on a particular day from Greens. The two-way radio in the truck is supplied by Greens, for the purpose of facilitating communication with Mr. Newman, so as to instruct him what to do next.

28. Mr. Newman is paid at an hourly rate. Initially, this was the hourly rate contained in the V.R.T.A. - T.W.U. agreement; under that agreement, the hourly rate declines after a certain number of hours has been worked, no doubt because it is considered that the component of the hourly rate designed to cover fixed costs of the vehicle has been covered in the hours worked. In fact, however, Mr. Newman and his fellow drivers "went on strike" and secured agreement from Greens to pay a flat hourly rate, irrespective of the number of hours worked. In addition, Greens pays superannuation contributions into a scheme set up by the Union, on behalf of Mr. Newman.

29. Mr. Newman does not have a regular starting time, but is told what his starting time is to be on the next day by a representative of Greens. He is supplied with and required to wear a uniform, bearing the name of Greens. That name also appears on documents which he carries, relevant to the particular carriage jobs which he performs. He had understood that he had the right to arrange for a substitute driver, but Greens refused to allow him to do this on the occasion on which he came to give evidence in this proceeding. Mr. Newman's own view was that owner-drivers working for Greens, including himself, have been treated no differently from other drivers employed by Greens to drive trucks owned by Greens, except with respect to the calculation of remuneration.

30. In all of these circumstances, it is clear that the relationship between Greens and Mr. Newman has been that of employer and employee at all times. The significant factor of ownership of part of the means required for transporting goods is outweighed heavily by the other factors indicating an employment relationship, particularly that of the right to control, given by clause 5 of the agreement between Mr. Newman and Greens.

31. Rex John Hore joined the Union in 1971. At that time, he was working as a driver for Green McCandlish Ltd., driving a vehicle owned by that company. He was paid what he described as "wages", from which income tax had been deducted on a pay as you earn basis. No real issue was taken as to Mr. Hore's eligibility to join the Union at the time when he did so join.

32. Shortly after he joined the Union, Mr. Hore purchased the first of a series of trucks which were owned by him, or by him in partnership with his wife. Between 1971 and 1985, Mr. Hore drove these trucks, which were mainly tip trucks, in which he carried for various persons, mainly on a "captive" basis. He gave evidence that there were occasions when he performed separate jobs for different persons on the same day, but there was no suggestion that these occasions were other than exceptional. There was an eighteen month gap in this period, during which Mr. Hore ran a workshop for a transport company in Dandenong; his duties included test driving of vehicles which had been serviced in the workshop. It was not disputed that he was an employee during this eighteen month period, and even his work in the workshop probably fell within the industries listed in rule 4 of the Union's rules.

33. In 1985, Mr. Hore and his wife incorporated or acquired a company, named R.J. and M.A. Hore Australia Pty. Ltd. That company owns a vehicle, and carries on business as a general carrier. Much of its work comes from Greens, in the form of carting steel from the Lysaght mill at Hastings. Mr. Hore is the company's driver. It pays him wages, deducting income tax on a pay as you earn basis.

34. There was no serious contest of the proposition that, since 1985, Mr. Hore has been an employee of his family company. The proposition that a person can be both a controlling director and an employee of a proprietary limited company finds support in the opinion of the Judicial Committee of the Privy Council in Lee v. Lee's Air Farming Ltd. (1961) AC 12. The issue is whether, by engaging in his owner-driver activities between 1971 and 1985, Mr. Hore lost his membership of the Union. The evidence as to the nature of his activities in that time is sketchy. The only aspects of it inconsistent with Mr. Hore remaining an employee throughout that time are the fact that he entered into a partnership with his wife in the ownership of a series of trucks, and the fact that he occasionally performed cartage jobs for more than one person on the same day. As to the first, it is established that the existence of a partnership is not necessarily inconsistent with the existence of an employment relationship between one of the partners as employee and another person. See Australian Mutual Provident Society v. Chaplin (1978) 18 ALR 385, at p 391, Barro Group Pty. Ltd. v. Fraser [1985] VicRp 59; (1985) VR 577, at p 580 and Jennings Industries Ltd. v. Negri (1982) 44 ALR 9, especially at p 13. In particular, it will not be so inconsistent if the main purpose of the establishment of the partnership appears to be the securing of an advantageous position with respect to income tax. As to the second factor, it is not necessarily inconsistent with the position of an employee that a person may do work for others at a time when free of obligations to his or her employer. There is therefore no clear evidence that Mr. Hore ceased to be eligible for membership of the Union at any time between 1971 and 1985. At the very least, there is nothing to show that Mr. Hore abandoned employment as a driver in the transport industry as his usual occupation during that period. He therefore remained a member of the Union at all times from 1971 until the date of closing of nominations in the elections the subject of this proceeding.

35. The evidence is unclear as to precisely when Barry Raymond Agg joined the Union. His own evidence was that he had joined in 1974, and had remained a member since that time. He was recalled by Mr. Dalton, and shown an application for membership, dated 18th July 1985, which described his occupation as "contractor" and stated that he was employed by Vaughans. Mr. Agg was not cross examined on his statement that he had joined the Union in 1974, other than by a suggestion, with which he agreed, that he may have joined earlier than that. Nor was there any cross examination directed to show that he may have ceased to become a member, so that his application in 1985 was by way of rejoining. He gave evidence about the work he was doing at the time when he said he joined, and about his subsequent work, but was not cross examined on these matters.

36. At the time when he believed he had joined, Mr. Agg was working for a transport operator known as Fleet Express. He was the owner of a prime mover, which was painted in Fleet Express colours and carried Fleet Express insignia. He used it to pull trailers owned by Fleet Express, which carried Fleet Express insignia as well. His truck carried a two-way radio, over which he received communications about his work. The vehicle was left on premises occupied by Fleet Express at times when Mr. Agg was not driving it. He worked exclusively for Fleet Express. He was obliged to wear and wore a uniform supplied by Fleet Express, and which carried its insignia. On this evidence, and in the absence of cross examination as to any factors indicating that Mr. Agg was not an employee, I am prepared to find that he was eligible to join the Union and that he did so in or about 1974. There is no evidence that he resigned thereafter, or that the Union took any action to deprive him of membership. His completion of an application on 18th July 1985 may have been the result of the absence of any prior application from the records of the Union.

37. From approximately 1977 until approximately 1980, Mr. Agg drove interstate for a company called Cubico. Again, he drove a prime mover which belonged to him, although during this time it was not painted with Cubico's colours or name. He towed trailers belonging to Cubico, which did carry its insignia, as did tarpaulins which were supplied by Cubico and used to cover loads on flat top trailers. Mr. Agg drove exclusively for Cubico during this time. Documents which he carried, such as manifests, bore Cubico's name.

38. In 1980, Mr. Agg began working as an interstate driver for a company known as Vaughans Transport ("Vaughans"). There was in evidence a written agreement between Mr. Agg and Vaughans, dated 22nd July 1980. That agreement was in the following terms:

"AGREEMENT WITH CONTRACTORS HAULING TRAILERS

The Company will :-

1. Arrange work from its terminals or other

nominated terminals.

2. Pay the Contractor for his time, work and

use of his vehicles at the rates applicable

from time to time.

3. Mail payments of amounts due to the

Contractor upon request to its Melbourne

Office once the cleared white copy of his

S.T.O. has been returned to that Office.

Any loss, shortage or damage to the load

will delay payment until such time as the

loss, shortage or damage has been

thoroughly investigated.

The Contractor will :-

1. Clearly understand that he remains an

independent Contractor, that he is not an

employee, agent or partner of the Company,

and has no authority to pledge the credit

of the Company.

2. Provide a vehicle suitably equipped with

quick-release turntable, standard air

fittings, long range tanks, 12 volt

electric supply for trailer lighting and,

if requested, painted to Company

specifications at no cost to the Company

within 30 days of commencing contracting to

the Company, and capable of legally hauling

a Company trailer with a payload of 11

tonnes on a single axle trailer and 16

tonnes on a bogie axle trailer.

3. Fit and return as requested by the Company

identification stickers for cabin doors

which will be supplied by and remain the

property of the Company.

4. Fully maintain, service and clean his

vehicle, independent of Company facilities.

5. Abide by all regulations of the Company and

instructions from authorised employees at

each Branch of the Company and conform to

the required standard of uniform, which is

available from the Company on a subsidised

basis.

6. Exercise maximum care of any Company

equipment while it is in his charge, and be

responsible to maintain it and return it in

the same order and condition, save for fair

wear, as it was received. The first $200

of the cost of repairing each occurrence of

damage or replacing each item of lost

equipment will be paid by the Contractor.

7. Exercise maximum skill and care to deliver

freight in good order and condition and,

where freight has been solely in his care,

to pay the first $100 of the sum of the

value of such goods which for any reason

are damaged, lost, stolen or short

delivered, and the cost of salvaging such

goods.

8. Be courteous at all times to clients and,

in the event of any dispute with a client,

contact the local Branch Manager as a

complaint from a client may result in

termination by the Company of this

agreement.

9. Adhere to time schedules, register at

designated check points and, at the

earliest opportunity during usual operating

hours, notify the Company's terminal of his

arrival in the destination city. Failure

to observe those requirements can result in

penalties to the Contractor and often cause

a breach of service by the Company.

10. Purchase fuel through the Company which

will supply fuel at its terminals at the

following price per litre for so long as

the wholesale price of fuel remains

unaltered.

Ex Adelaide Melbourne Brisbane Sydney

Distillate 31.37c 31.89c 29.65c 29.65c

litre litre litre litre

11. Park trailer at Company terminal in each

State.

12. Keep his vehicle out of the Company

terminals until required.

13. Keep vehicle registered to haul a

semi-trailer.

14. Maintain a current comprehensive insurance

policy on his vehicle and produce it to the

Company for inspection at any time.

15. Ensure that the vehicle is driven only by a

person holding a current valid driver's

licence.

16. Advise the Company immediately he does not

hold a current valid driver's licence or

the vehicle becomes uninsured

comprehensively or unregistered.

17. Obtain axle weights before departure and

contact the local Manager to arrange for

any excess weight to be removed if axle

weights exceed maximum legal limits.

18. Be responsible for all fines for

overloading, speeding or other fines which

result from the act of, or neglect by, the

Contractor.

19. Upon termination of his period of

contracting with the Company, be

responsible for the return of the trailer

hauled by him to the Depot from which he

initially was supplied with a trailer, or

to pay for its return at ruling rate unless

he has a written authority from the

Company's Fleet Manager to leave the

trailer at some other Depot.

20. And does hereby authorise the Company to

deduct from any amounts owing to him any

amount owing by him to the Company from

time to time for goods and services

supplied or payments due under the terms of

this Agreement."

39. As will be seen, clause 1 of this agreement contains the express designation of Mr. Agg as an independent contractor. Clause 5 permits Vaughans to have unlimited control over Mr. Agg, including as to the manner of performance of work by him, by means of instructions from Vaughan's authorised employees. Mr. Agg was the owner of a prime mover only, towing trailers owned by Vaughans, which carried its insignia. He carried documents bearing the name of Vaughans. He received instructions by telephone as to when to start and where to go. Contributions on his behalf were paid to the Union's superannuation fund. For some time, he was a delegate of the Union among drivers working for Vaughans.

40. Against these factors, others were urged. Mr. Agg was paid a rate per trip, which at some stage was set by agreement between the Union and the Australian Road Transport Federation. His truck bore a business name of which he was the proprietor. Until 1982, when his marriage broke down, he and his wife had been in partnership as proprietors of the same business name, although it was unregistered at that time. The purchase price of his last truck was $43,000, and he traded in his previous truck for $15,000. He received no holiday pay, sick pay or long service leave. He estimated that, on average, fifty or fifty-five per cent of gross earnings went in expenses of running a truck. By his own choice, he did not allow any substitute driver to operate his truck. He agreed with a suggestion in cross examination that he could refuse to accept work from Vaughans, but said he could only refuse "to a certain extent". In re-examination, he explained that in practice, refusal of a job would mean that nothing would be offered for a week or a fortnight by way of "retribution for not being a good boy". Reliance was also placed on his stated reason for having purchased a truck, which was "to try and improve my standard of life and standard of life for my family initially". He agreed that he had hoped to be able to build up a business out of which he would be able to earn more than if he had worked as an employee. He denied any ambition to build up a fleet of trucks. In his nomination form in the elections, he described himself as "self employed owner driver".

41. In late 1985 or early 1986, Mr. Agg spent nine or ten months as fleet controller for Vaughans at a depot owned by Vaughans in Footscray. He was paid a weekly wage, minus deductions of income tax on a pay as you earn basis.

42. Late in 1986, Mr. Agg began to work for a business entity named Forstaff, which operates as an employment agency in the transport industry. Initially, he sought work from Forstaff at times when Vaughans had nothing available for him. He worked for Forstaff for approximately two months a year until 1988, when the period was approximately four months. From December 1988 until immediately prior to the hearing of this proceeding, he worked full time for Forstaff except for one trip for Vaughans. His work involved driving vehicles belonging to any person for whom Forstaff arranged to supply Mr. Agg's services as a driver. He was paid weekly for the hours he had worked. It was conceded that, in working for Forstaff, Mr. Agg was working as an employee. He was therefore eligible to remain a member of the Union, even though his work for Forstaff was, for a time, on a part time basis. Nothing in the rules of the Union suggests that eligibility for membership is only to be attained by full time employment.

43. The issue with respect to Mr. Agg is whether his work for Vaughans as a driver was otherwise than as an employee. In my view, the balance of the competing factors comes down in favour of his being an employee. It is perhaps the express requirement in clause 5 of his written agreement, that Mr. Agg abide by all instructions, that tips the balance, in the light of the emphasis which was placed on control as a factor by the High Court of Australia in Stevens v. Brodribb Sawmilling Co. Pty. Ltd. (1986) 160 CLR 16, especially at pp 27 and 36. If he had joined earlier, Mr. Agg did not become disentitled to continue as a member by reason of his work for Vaughans. If he had not joined earlier, he was entitled to join in July 1985, because he was an employee of Vaughans.

44. Darren Mark Crump gave evidence that he joined the Union in 1981. At that time, he was working for a transport operator named F. Kerrigan Pty. Ltd., driving a vehicle owned by that company, and being paid "wages". There does not appear to be any dispute that he was employed by that company, and would have been eligible to join the Union in 1981.

45. In or about 1984, Mr. Crump purchased a prime mover. For approximately eighteen months, he worked exclusively for a transport operator known as Butler Transport. He then worked exclusively for two other transport operators for short periods in succession, before undertaking the work which he was still doing at the date when nominations closed. This was work for a company called L. Arthur Pty. Ltd. ("Arthurs"). He gave evidence that he had moved from company to company in order to obtain a better income.

46. In working for Arthurs, Mr. Crump used his own prime mover, for which the purchase price had been $19,500, and in respect of which he had entered into a hire-purchase agreement. He paid all of the expenses of the truck, which amounted to about fifty-five per cent of his gross earnings. Arthurs deducted tax under the prescribed payments scheme. Mr. Crump was paid weekly, after submitting an invoice showing his hours worked. Any annual leave, sick pay or long service leave had to be provided by him out of the rate which he earned. If Arthurs did not have any work for him on a particular day, Mr. Crump would contact one of the companies for which he had previously worked, and try to obtain work. He did not succeed in doing so on any occasion.

47. The truck which Mr. Crump drove bore on it the business name F-DAK Transport, this being a business name of a partnership in which Mr. Crump and his mother were the partners. Application to register this business name was dated 8th August 1985. Mr. Crump gave evidence that the partnership had resulted from the advice of an accountant, and was mainly for tax purposes. His mother's contribution was to keep the books of the partnership; for this, she received $50 per week, out of gross earnings of approximately $70,000 per year. Mr. Crump's case was unusual in this inquiry, in that the administration manager of Arthurs was called to give evidence. He made it clear that it was of no concern to Arthurs whether an owner-driver engaged by Arthurs had a business name or partnership; Arthurs was interested in the suitability of the vehicle and the driver.

48. In the course of his work for Arthurs, Mr. Crump pulled trailers owned by Arthurs. The name of Arthurs was painted on those trailers, and also appeared on tarpaulins used by him to cover loads. His normal starting time was 7.30 a.m., which the administration manager described as "the general starting time of most personnel in the organisation". He was then directed to his first job, and subsequently directed to other jobs by two-way radio, provided by Arthurs and placed in Mr. Crump's truck. Documents carried by him were documents of Arthurs, or of customs agents, but not documents of Mr. Crump or F-DAK Transport. Mr. Crump was paid at an hourly rate, being the rate specified by the V.R.T.A. - T.W.U. agreement. Mr. Crump gave evidence that no substitute driver had ever driven his truck. The administration manager said that, on one occasion, another owner-driver had needed to provide a substitute driver, and that Arthurs had satisfied itself that the substitute was a competent replacement. It appears that Arthurs owns a substantial number of trucks itself, and these are driven by employee drivers. It also uses a few owner-drivers, all but one of whom own prime movers only, and not trailers.

49. There being no written agreement between Arthurs and Mr. Crump, it is more difficult to determine their relationship than is the case with Mr. Newman and Mr. Agg. It is not possible to point to an express term giving a right to control. Nevertheless, I am of the view that the balance of factors leads to the conclusion that Mr. Crump was an employee. It is of significance that he owned only the prime mover. The fact that he attempted to find work elsewhere on occasions when Arthurs did not provide any is consistent with his being a casual employee. His partnership with his mother may have had more significance if it had been a matter of concern to Arthurs that it was dealing with a partnership. The balance is perhaps a fine one, but in my view it favours the existence of an employment relationship.

50. Assuming that he did join the Union in 1981, Mr. Crump was eligible to do so. On the evidence before me, he did not cease to be an employee, or at the very least to have as his usual occupation that of an employee, between 1981 and the date when nominations closed.

51. Allen Robert Worley was born in 1933. He began working for his father, who owned a truck, at the age of sixteen. Over the years, he has had many jobs driving trucks, and corresponding periods of membership of the Union. Those jobs have been interspersed with jobs as a nurse and as a foundry worker. Prior to 1985, he had always driven vehicles owned by those who engaged him to do so, and been paid "wages", from which income tax had been deducted on a pay as you earn basis.

52. Mr. Worley last applied to join the Union on 30th October 1984. He had responded to a newspaper advertisement by Coynes Transport Industries Pty. Ltd. ("Coynes"), and had attended an interview. He had been advised that he would be given employment as a truck driver on a casual basis, on a daily rate that would be loaded to cover payment of sick leave or annual leave. He was not to be paid for a particular day if he was not required to work. He was promised that if he should prove suitable after six weeks' casual employment, he would be offered employment on a regular weekly basis. After being given the job, he went to the Union office to renew his membership. In fact, he worked for Coynes on each day of the six week period, at the end of which he was offered and accepted regular weekly employment. This continued until about 27th February 1985. During that period, Mr. Worley attended Coynes's premises at Footscray by 7.30 a.m. each day. A truck was allocated to him. The trucks were owned by Coynes, and he was given a day work sheet containing his instructions for the day by a supervisor. Each of the trucks was equipped with two-way radio, by way of which Mr. Worley's instructions were varied, or additional instructions were given. As a casual employee, Mr. Worley was paid a daily amount, and also received a weekly payment in respect of overtime. Income tax was deducted from his wages on a pay as you earn basis. When he became a regular weekly employee, he was paid weekly and was also given sick leave and annual leave entitlements. It was not disputed that Mr. Worley was eligible to join the Union, by reason of the nature of his work for Coynes, in October 1984.

53. In or about March 1985, Mr. Worley responded to another newspaper advertisement seeking a casual truck driver for seven weeks. He was interviewed by a yard manager of John Danks and Son Pty. Ltd. ("Danks"), and given a job. In this job, he was allocated a truck. Each day, the manager of the yard advised him of the time he was to commence work on the following day. Each day he was given a work sheet containing his instructions for the day. Usually he returned to the yard during the course of the day to pick up new loads, and at times his work sheet was varied, or additions were made to it, when he so returned. In the course of his employment with Danks, he injured his back unloading a truck and was absent from work for a few days. He was paid workers' compensation. He was normally paid weekly at casual rates, and income tax was deducted from his pay on a pay as you earn basis. He worked for Danks on each day of the seven week period for which he was engaged.

54. While working for Danks, Mr. Worley purchased the only truck he has ever owned. It was a prime mover, and its purchase price was $8,500. He spent a further $7,500, converting it to a rigid tray truck. After he had finished work for Danks, he worked for some five transport operators, before undertaking work for a taxi truck operator called Spot On. In each case, according to his evidence, the working arrangements were similar to those he encountered at Spot On. He moved from company to company because he was not satisfied with the amount of work provided to him.

55. From September 1988 until the present time, Mr. Worley has worked for Spot On exclusively. He owns his own truck, and provides his own equipment, although he may sometimes borrow equipment from Spot On to tie down a load. There is no two-way radio in his truck, because he did not take up Spot On's offer to put one in, preferring to seek his instructions by telephone after completing a job. He submits a weekly account to Spot On of the work he has done, together with running sheets recording that work. Sick pay, holiday pay and overtime are loaded into his rate of pay, as he described it on a similar basis to when he was employed as a casual by Coynes and Danks. Income tax is deducted from his remuneration under the prescribed payments scheme. He pays the expenses of running his truck, which amount to approximately half of the gross earnings. He is in partnership with his wife, who keeps the books of the partnership. He describes this partnership as being for tax purposes. Each night, he takes the truck home.

56. Mr. Worley's remuneration is at an hourly rate, which he describes as being "set by Spot On". It is $2 per hour above the rate in the V.R.T.A. - T.W.U. agreement. He works exclusively for Spot On. His jobs are generally allocated by telephone. He carries running sheets, giving details of his jobs. These running sheets bear the name of Spot On, or of one of its customers. Mr. Worley is not permitted to substitute another driver for himself.

57. As to the question of control, there is only Mr. Worley's evidence, which was in these terms:

"So far as control by the boss is concerned,

you are expected to run the company rules and

regulations and there is no question about

that, whether your truck is in their colour,

you are using their tarps or anything else."

As to his own description of himself, one of Mr. Worley's answers sheds some light. He was asked in cross examination a question about establishing a business in the taxi truck area. The question and answer were as follows:

"Question: It is not easy for you to sort of

set yourself up and look for

customers in this very competitive

industry, is it?

Answer: It can be done. There is no

question of that. If I had enough

money to carry myself for a while

and I wanted to become an

independent contractor, I would do

that."

58. Mr. Worley's case is perhaps the most finely balanced of all. On the evidence available, however, he falls just on the employee side of the line. His unchallenged answer as to control is of particular significance.

59. There remains the question whether Mr. Worley lost the status of being an employee, or the usual occupation of being an employee, between the time when he joined the Union and the date of closing of nominations. During that time, in the winters of 1985 and 1986, he made an attempt to establish a business, using his truck to cart fire wood from Mathoura in New South Wales to Melbourne. The demand for fire wood fell off in each summer, and Mr. Worley abandoned the attempt after the second winter. The only other relevant piece of evidence is that, for some time, Mr. Worley has held the intention of doing up his rather old truck, selling it, and seeking a job driving a truck owned by someone else. In these circumstances, and having regard to Mr. Worley's lengthy history as an employee, it does not appear that he ever abandoned the status of being an employee, in the sense that that was his usual occupation. He did not therefore lose his membership of the Union between the date when he last joined in October 1984 and the date of closing nominations.

60. It follows from what I have said that each of Messrs. Newman, Hore, Agg, Crump and Worley satisfied the requirements of rule 22(a)(I) of the rules of the Union. The rejection of their nominations on the ground of failure to satisfy the requirements of that provision amounted to a breach of the rules. Unless the nomination of any one of them for any position was rejected properly under another provision of the rules, an issue which is discussed below with respect to some of them, an irregularity occurred by reason of the rejection.

61. Patrick Thomas Power and Stephen Paul Roach were taxi drivers. Their nominations were accepted by the returning officer. The correctness of those nominations was challenged by Mr. Dalton and Mr. Marshall, on the basis that, at the date when nominations closed, the relationship between each of the taxi drivers and the owner of his taxi was not an employment relationship.

62. There was little evidence about Mr. Roach, except that he was a part-time taxi driver, and had not signed a leasing agreement with the owner of the taxi. Mr. Power gave substantially more detailed evidence, as did the owner of the cab driven by Mr. Power, Brian Anthony Crichton. Mr. Crichton was the owner of two taxis. In normal circumstances, Mr. Crichton and Mr. Power took shifts at driving one of them, and other persons drove the other. Only one person who drove one of these taxis had signed a lease agreement with Mr. Crichton. The expenses of operating the taxi were paid by Mr. Crichton. Mr. Power was remunerated by receiving half of the takings of his taxi during the times he was driving it. In addition, Mr. Power was allowed to keep tips and certain fees for radio calls. Mr. Crichton deducted fifteen percent of Mr. Power's gross earnings for income tax, under the prescribed payments scheme.

63. It appears that, under Victorian legislation, the Road Traffic Authority prescribes forms of leasing agreements with respect to taxi cabs, and that those are the only forms prescribed by law. A standard form leasing agreement was in evidence, as were forms of leasing agreements prescribed by the Transport Regulation Board, under earlier legislation. An attempt was made to argue that, because the basis of the remuneration of Mr. Power was similar to that found in those leasing agreements, he was to be taken as being a lessee of the taxi, and not an employee.

64. Reference was made to the decision of the High Court of Australia in Dillon v. Gange [1941] HCA 5; (1941) 64 CLR 253. In that case, a taxi owner was sued on the basis of the negligence of the driver of the taxi. In seeking to establish that the driver was an employee of the owner, reliance was placed on a by-law of a municipality, which provided that no owner of a taxi should, without the approval of the town clerk, hand over or entrust his cab to any person to drive or ply for hire, except in the capacity of a servant. There was in evidence in the case a written agreement between the owner and the driver, under which the owner purported to hire the taxi to the driver. The High Court held that this written agreement rebutted the presumption that the by-law would be obeyed, and established that the relationship between the owner and the driver was that of bailor and bailee. In the result, the owner was not liable vicariously for the driver's negligence. In his judgment, at p 259, Starke J. said:

"The appellant led evidence which, standing

alone, is sufficient to support the finding

that the driver of the taxi-cab was the

servant of the respondent. The taxi-cab was

owned by the respondent; he was registered as

the owner under the Motor Car Act; he also

held an owner's licence and a motor-car

licence to ply for hire in respect of the

taxi-cab within the metropolitan area. The

driver, who also held a driver's licence, was

in possession of the taxi-cab with the

respondent's consent, although the respondent

did not know that the driver was actually

driving the cab at the time of the accident.

The respondent supplied the petrol used by the

cab and attended to the maintenance, running

condition, and upkeep of the cab and paid

registration fees therefor."

His honour went on to refer to the terms of the by-law. From this passage, and from an examination of the remainder of the three judgments in that case, it appears that it was the existence of the written agreement in that case which took the relationship outside that of employer and employee.

65. In the present case, in the absence of any written agreement, there is nothing to indicate that either Mr. Power or Mr. Roach was a bailee or lessee of the taxi which he drove. The circumstances point to an employment relationship in each case. The mere fact that some of the terms of a standard or prescribed leasing agreement have been adopted does not warrant a conclusion that a leasing agreement not in writing has been entered into.

66. Being employees as at the date of close of nominations, each of Mr. Power and Mr. Roach was eligible to be nominated, and no irregularity resulted from the acceptance of the nomination of each by the returning officer.

67. It will be recalled that rule 22(a)(I)(i) of the rules of the Union provides that a person shall not be eligible to nominate for any office unless at the date of close of nominations he or she is a financial member of the Union. Rule 22(a)(II)(i) contains a provision that a person shall not be eligible "to hold or retain any office" unless "at all times of holding the office", he or she is a financial member of the Union. Rule 22(b) provides as follows:

"(b) Subject to para (a) hereof a person is

eligible to hold the office of -

(i) Federal President;

Federal Vice-President;

Federal Secretary;

Federal Assistant Secretary; or

(ii) Branch President;

Branch Secretary;

Branch Industrial Research Officer;

or

(iii) Organiser (whether elected or

appointed);

if he is a financial member of the Union

continuously for the previous three years

and is financial at the time of his

nomination for election (or appointment

as the case may be) but not otherwise."

Rule 18 makes provision for contributions. Under rule 18(a), in respect of persons applying after 1st January 1982, there is provision for payment of the full year's contributions if the application is made between 1st January and 30th June, and for half the year's contributions if the application is made during the second six calendar months. Rule 18(b) requires a member to pay contributions within fourteen days from the date of making application for membership. Rule 18(c) provides for contributions in each subsequent year. For members in the Victorian branch, the rule provides that the full amount shall become due and payable on 1st January and be paid not later than 28th February. There is evidence that in December of each year accounts for contributions in respect of the following year are sent to members of the Victorian branch. Rule 21 provides as follows:

"21 - UNFINANCIAL MEMBERS

Any members who fails (sic) to pay entrance

fee, contributions, fines or levies, as

prescribed by these Rules, shall be deemed to

be unfinancial until all such entrance fee,

contributions, fines or levies have been paid

and ten days thereafter.

Unfinancial members shall be debarred from

all benefits, privileges or rights whatsoever

connected with the Union."

The remaining provision to which reference must be made in this context is rule 33(q), which provides:

"(q) Members declared elected under this Rule

shall take office from the 20th day of

April immediately following the

declaration of their election and the

retiring members shall continue to act in

the meantime provided that where there

are no retiring members, the sucessful

candidates shall assume office

forthwith."

68. The returning officer regarded it as his obligation to measure the eligibility of candidates for any of the offices referred to in rule 22(b) by reference to the criteria in that rule. He took the view that it would be futile to accept nominations of candidates who would not be eligible to hold office, and to go through to the stage of perhaps declaring those candidates elected, whereupon they would be unable to take up the office, and a further election would have to be held. The returning officer took the phrase "the previous three years" to relate to the three years immediately prior to 20th April 1989, which would be the latest date on which the successful candidates would take up office pursuant to rule 33(q). Wherever the returning officer found in the records of the Victorian branch that a candidate for one of the offices listed in rule 22(b) had failed to pay contributions prior to ten days before 20th April 1986, or prior to 28th February in 1987 or 1988, he rejected the nomination of that candidate.

69. Some of these rejections were alleged to constitute irregularities. This was so with respect to Christopher Keily and Allen Robert Worley, who were candidates for the office of branch secretary and Denis Martin Ryan, who was a candidate for branch organiser. Nominations for Joseph Henry Sanders for the offices of branch president and organiser and Lee Robin Farmer for the office of organiser were accepted by the returning officer, but Mr. Dalton and Mr. Marshall contended that their acceptance was an irregularity, because they had not been continuously financial within the meaning of rule 22(b). Mr. Dalton and Mr. Marshall supported the returning officer's construction of rule 22(b).

70. Mr. Borenstein's contention was that rule 22(b) was of no concern to the returning officer at all. He argued that the rule related only to eligibility to hold any of the offices specified, and that a person's ability to hold an office could only be tested at the stage when the person had been declared elected, and came to take up the office. The argument gains support from an examination of rule 22 as a whole. The phrase "eligible to nominate" is used in a number of sub-rules, including (a)(I), and (d) and (e), both of which relate to ineligibility by reason of age. On the other hand, the phrase "eligible to hold" is used in sub-rule (a)(II), which focuses clearly upon the situation of a person who has been elected to an office. It also gains support from the provisions of rule 25A, which prevent a person being dismissed from office unless he or she has been found guilty of certain specified offences, "or has ceased, according to the Rule of the Union, to be eligible to hold the office." Mr. Borenstein drew attention to a practical difficulty arising from the returning officer's view. In fact, because the conduct of a ballot in the current elections has been stayed by order of the Court, pending the determination of this proceeding, it is possible that, by the time the result is known, Mr. Keily and Mr. Ryan might have three years' continuous financial membership, whatever view is taken of the meaning of the word "continuously" in rule 22(b). There is no doubt that the choice of 20th April as the date from which to count back the previous three years is not capable of producing a proper result in all cases, especially given that rule 33(q) makes provision for a candidate to take up office at an earlier date in some circumstances.

71. In the alternative, Mr. Borenstein submitted that rule 22(b) does not have the effect of requiring that a candidate for one of the specified offices should never have been in arrears at any stage during the previous three years. He said that all that the rule required was that a candidate have been a member for the previous three years, and have been financial in respect of each of those years. He relied on the judgment of Smithers J., with whom Evatt J. agreed on this point, in Lovell v. Federated Liquor and Allied Industries Employees' Union of Australia [1978] FCA 43; (1978) 22 ALR 704, at pp 731-732, and the decision of Smithers J. in Re Application by Walsh for an Inquiry into an Election in the Australian Journalists Association (unreported, 19th November 1981). This argument is supported by the use of the present tense, and the positioning of the adverb in the phrase "is a financial member of the Union continuously for the previous three years". By way of comparison, reference should be made to Re Application by Carter for an Inquiry into Elections in the Federated Clerks Union of Australia (Federal Court of Australia, Gray J., 31st May 1989, unreported), where the words used were "has been a continuously financial member". Finally, Mr. Borenstein submitted that if rule 22(b) did require that a candidate not have fallen into arrears at any time during the previous three years, it was invalid as imposing upon members conditions, obligations or restrictions which, having regard to the objects of the Act and the purposes of the registration of organisations under the Act were oppressive, unreasonable or unjust. See s.140(1)(c) of the Conciliation and Arbitration Act (1904), now repealed, but preserved in its operation for the purposes of these elections by s.53 of the Industrial Relations (Consequential Provisions) Act 1988. On that basis, the provisions of the rule should have been ignored by the returning officer.

72. Mr. Black also submitted that rule 22(b), on its proper construction, did not require that a candidate never have been in arrears during the previous three years. Taking 20th April as the date from which the period required was calculated, Mr. Black pointed out that the rule would contain an irrelevant and wholly unnecessary provision if it were construed in this way. If a candidate were required to be financial on every single day for three years immediately prior to 20th April following the election, that period would include the day on which the candidate's nomination was lodged. It would therefore be unnecessary for the rule to provide, as it does, that the candidate must be financial at the time of his (or her) nomination.

73. In my view, none of the arguments put as to the construction of rule 22(b) is correct in all respects. The rule is one which in truth relates to eligibility to nominate, and must be applied by a returning officer in conducting elections for the specified positions. At the very least, this conclusion results from the inclusion of the requirement that a person be financial at the time of his or her nomination. It is to be noted that this is a requirement different from that imposed by rule 22(a)(I), to be financial at the date of closing of nominations; rule 22(b) focuses on the date on which a particular nomination is lodged. It would be strange if the returning officer were obliged to look at rule 22(b), to decide whether a candidate was "eligible to hold" a particular office by reason of being financial at the date when his or her nomination was lodged, but was compelled to ignore the rest of the rule, on the basis that it could have application only at a later date, when the person came to take up the office. This process of reasoning leads to the conclusion that the date at which the candidate is required to satisfy rule 22(b) is not the date on which the office would be taken up, but the time of the particular candidate's nomination for election to the position. In other words, rule 22(b) contains two separate criteria which a candidate for one of the specified offices must satisfy, both at the time of the candidate's nomination. This construction explains the use of the present tense with respect to both criteria. Thus, at the date when a candidate lodges his nomination, the returning officer must look to see whether he or she "is" a financial member of the Union continuously for the previous three years and "is" financial at that time. The previous three years is the three years dating back from the time of the particular candidate's nomination.

74. The submissions that rule 22(b) does not require that a candidate for the specified offices not be in arrears at any time during a three year period really depend upon the word "continuously" being read down in some way. Counsel who advanced these submissions supported them by reference to rule 21, pointing out that that rule imposed its own penalties on anyone paying contributions late. It was urged that rule 22(b) was not intended to impose an extra penalty of being unable to stand for certain offices, because of unfinanciality for so short a period as a single day in three years. These arguments have force. The difficulty with them, however, is that they do not give to the word "continuously" work to do in the interpretation of the rule. If the word "continuously" were omitted, the rule would require that a candidate be a financial member for the previous three years, i.e. in respect of each of those years. That is the construction which was urged upon the Court of the rule as it stands. The word "continuously" should not be regarded as mere surplusage. In inserting it, the framers of the rule intended it to have meaning. The ordinary and natural meaning of "continuous" is connected without break or uninterrupted. In my view, that is the meaning intended in this rule. A candidate for one of the offices specified in rule 22(b) must not only have been a member of the Union for three years immediately preceding the date of his or her nomination, but must also have been financial throughout the whole of that period, in the sense of never having fallen into arrears during that period.

75. So to construe the rule is not to render it in contravention of s.140(1)(c) of the Conciliation and Arbitration Act 1904. Most of the cases in which rules have been held to contravene that provision by imposing qualification periods for eligibility for office have been concerned with questions such as turnover of members or practical difficulties in ensuring that contributions were kept up to date. See Leveridge v. Shop Distributive and Allied Employees' Association [1977] FCA 9; (1977) 31 FLR 385 and Lovell v. Federated Liquor and Allied Industries Employees Union of Australia [1978] FCA 43; (1978) 35 FLR 72. In the present case, there is no evidence that the Union has a particularly high turnover of members; it would not be expected that the turnover would be as high as was the case in an organisation whose membership was mainly in retail shops, or one whose membership was largely in hotels and other catering establishments. It is not necessary for a member to wait for an organiser to attend at his or her workplace, in order to know how much he or she is obliged to pay for a particular period. Accounts are sent by post to members in December. A member has until 28th February in each year to pay the year's contributions. During that period, the member will not be in arrears, and will remain financial, even though contributions are due and payable on 1st January. A new member has a fourteen day period of grace, during which he or she will not be in arrears. It is therefore relatively easy to remain financial continuously. Rule 22(b) only imposes the qualifications which it contains on the offices it specifies, which are the important offices or full time positions within the Union and its branches. It does not operate therefore to exclude members from any say in the government of the Union for long periods. In my view, construed as I have construed it, it is a rule which does not offend any statutory provision.

76. Denis Martin Ryan was a truck driver employed by Carlton and United Breweries. According to the records of the Victorian branch of the Union, his contribution in respect of the year 1986 was not paid until 25th June in that year. Mr. Ryan gave evidence that he habitually paid his contribution to the shop steward in January of each year. He recalled paying in 1986 to the shop steward, who was Donald Alexander Porter, the applicant in this proceeding. Mr. Ryan did not recall the precise date of the payment, otherwise than by saying that it was his habit to pay before 28th February. According to his evidence, at the time when he paid Mr. Porter, the latter did not have his receipt book with him, so that Mr. Ryan was not given a receipt at the time.

77. Christopher Keily was also a driver employed by Carlton and United Breweries. He was assistant shop steward for some time, and replaced Mr. Porter as shop steward in mid 1986. While he was assistant shop steward, his contributions were paid in a rather odd way. The shop steward received a commission from contributions which he collected from employees at Carlton and United Breweries. From this commission, Mr. Porter paid his own and Mr. Keily's contributions. Mr. Porter would then issue a receipt to Mr. Keily. It followed from this system that the date on which Mr. Keily's obligation to the Union was satisfied in any year might depend upon enough contributions coming in from other members at Carlton and United Breweries to give rise to sufficient commission to cover the contributions of the shop steward and the assistant shop steward.

78. In May 1986, Mr. Porter resigned as shop steward and Mr. Keily was elected. An organiser from the Victorian branch of the Union took Mr. Porter's receipt books and other books away, and did not give any to Mr. Keily for some weeks. Mr. Porter did not hand any money which he had collected to Mr. Keily; apparently all his collections went to the office of the Victorian branch of the Union. Mr. Keily issued a receipt to Mr. Ryan for his contributions in June of 1986. Why he did this, if Mr. Ryan had paid some four or five months earlier to Mr. Porter, is not clear. The records of the Victorian branch of the Union show Mr. Ryan's contributions as having been transmitted by Mr. Keily to the office on 25th June 1986. The records also showed Mr. Keily as having paid his 1986 contributions on 24th April 1986.

79. I am unable to find on the balance of probabilities that Mr. Ryan did pay his 1986 contributions before 28th February of that year. I am not satisfied that he paid in that year according to his usual habit. In cross examination, he admitted to having a receipt still in his possession in respect of his 1986 payment. He undertook to hand that receipt to the applicant's solicitor. That receipt was never tendered in evidence. The only other person who might have been able to shed light on Mr. Ryan's payment was the applicant himself. He was never called to give evidence, and no explanation was given for his absence from the witness box. The same could be said in relation to Mr. Keily. No real attempt was made to establish payment earlier than the date shown in the records of the Union. Had there been such earlier payment, Mr. Porter would have been the person able to give evidence of it. Instead, Mr. Borenstein attempted to argue that Mr. Keily had paid according to a system accepted by the Union, and should not be penalised by being regarded as having been in arrears. This argument is unacceptable. The obligations imposed by the rules on Mr. Keily were the same as those imposed on any other member. They were not waived by the Union. It was always open to Mr. Keily to pay his contributions, independently of any commission received by Mr. Porter, if he wished to remain financial at all times. By choosing to wait until Mr. Porter had received enough commissions to cover two sets of contributions, Mr. Keily took the risk of allowing himself to fall into arrears. He cannot be heard to complain that this is what occurred.

80. It was conceded that Mr. Worley's contributions in respect of the year 1986 were not paid until 17th February 1987, at which time he also paid his 1987 contributions. He was therefore in arrears for a little less than a year in respect of his 1986 contributions.

81. It follows that the returning officer acted correctly in rejecting the nomination of Mr. Keily for branch secretary, the nomination of Mr. Ryan for organiser and the nomination of Mr. Worley for branch secretary, because each did not comply with rule 22(b). The returning officer also rejected the nominations of certain other persons for offices specified in rule 22(b), but these rejections were not challenged by evidence in this proceeding. In view of my conclusions as to the correct construction of rule 22(b), it must be taken that those rejections were in accordance with the rule.

82. Joseph Henry Sanders nominated for branch president and organiser, as well as for another position not the subject of rule 22(b). His nominations were accepted. They were challenged in the course of the inquiry, on the basis that Mr. Sanders did not comply with rule 22(b), in that he had paid his 1988 contributions after 28th February 1988. Mr. Sanders gave evidence that on 19th February 1988, he applied for a job at a business called Fluid Freight in Brooklyn. He was asked to obtain a medical certificate. He went immediately and obtained a medical certificate, and returned to the Fluid Freight premises, where he was told that he had been given a job. He then spoke to the Union's shop steward at the premises, Garry Wayne Scott. Mr. Sanders told Mr. Scott that he had been given a job, and offered to pay his Union fees then and there, in order to secure his financial status. Mr. Sanders paid the amount of the 1988 contribution to Mr. Scott, who was not in a position to give him a receipt, as he did not have a receipt book at the time. Subsequently, Mr. Scott issued a receipt to Mr. Sanders, dated some time in March. It appears that the records of the Victorian branch of the Union show Mr. Sanders's contributions as having been paid on 3rd March 1988.

83. I accept the evidence of Mr. Sanders that he did pay on 19th February. His evidence is supported by a statutory declaration of Mr. Scott, which was tendered without objection, and without request to cross examine Mr. Scott. It was common ground that receipt of money by a shop steward was receipt by the Union itself, and that a member could not be penalised as to financiality by any delay in transmission of the money from a shop steward to the branch office. The nominations of Mr. Sanders were therefore valid, and no irregularity occurred by reason of their acceptance by the returning officer.

84. A nomination was also accepted from Lee Robin Farmer, for the position of organiser. This nomination was challenged, on the ground that Mr. Farmer was unfinancial. The records in the Victorian branch of the Union show that he did not pay any contributions in respect of the year 1986, and was in arrears at the date of closing nominations to the extent of $97, that being the amount of the 1986 contribution. Mr. Farmer gave evidence. During 1985 and 1986, he was a truck driver employed by a business known as Linfox. In 1985, Linfox was performing distribution work for Metropolitan Dairies. It was the practice for Linfox to pay to the Union early in the calendar year an amount sufficient to cover the contributions for that year of each member employed by Linfox on Metropolitan Dairies work, and then to deduct from the pay of each of those employees each week an amount sufficient to make up over the year the total amount of the contribution paid for that employee. Mr. Farmer was working on the Metropolitan Dairies work in 1985, and his contribution for that year was paid by this means. Prior to 1986, he was transferred by Linfox to Coles work. Linfox did not pay contributions to the Union for its Coles drivers, or collect money from their wages for the purpose of paying contributions. Mr. Farmer was under the impression that he had paid 1986 contributions, but was unable to produce a receipt for them. In the circumstances, it is probable that the records in the branch office are correct, and that Mr. Farmer did not make any payment in respect of 1986.

85. Mr. Borenstein attempted to argue that Mr. Farmer should be treated as financial, because of some lack of understanding of the arrangement with Linfox. This would be difficult. There is no evidence that Mr. Farmer paid Linfox any money in respect of his 1986 contribution. Even if he had, it is doubtful whether Linfox would have received that money as agent for the Union. Linfox appears to have been involved in paying as agent for its drivers, collecting the money from them afterwards, rather than as agent for the Union, receiving contributions pursuant to some agreement with the Union. Accordingly, Mr. Farmer remained unfinancial, and his nomination should not have been accepted. An irregularity resulted from its acceptance.

86. The original timetable fixed for the conduct of the elections provided for nominations to be called between 8th November and 29th November 1988, for the ballot to open on 10th February 1989 and to close on 3rd March 1989. The period for lodging nominations opened on 8th November 1988 as planned. On or about 14th November, several persons who described themselves as prospective candidates, and who were members of a group described as the reform group, complained to the returning officer that they were not being permitted to examine their personal financial records in the records of the Victorian branch of the Union.

87. On 15th November, the returning officer gave a direction, purportedly pursuant to s.170A(1) of the Conciliation and Arbitration Act 1904. That sub-section provided as follows:

"A person conducting an election, or taking a

step in or in connection with an election, for

an office in, or a branch of, an organization

under section 165A or under section 170, may,

notwithstanding anything contained in the

rules of the organization or branch, take such

action and give such directions as he

considers necessary in order to ensure that no

irregularities occur in or in connection with

the election or to remedy any procedural

defects in those rules which appear to him to

exist."

The direction was in the form of a letter to Mr. Davis, the branch secretary, in the following terms:

"Several prospective candidates have advised

me that they have been denied access to their

financial history as recorded in the Register

of Members held in your office.

In order that members may determine their

eligibility to stand, it is necessary that

they be given access to their financial

history, including receipt book copies, and in

such a way as to enable them to write down any

details relating to their personal financial

history.

Under the provision of Section 170A of the

Conciliation and Arbitration Act 1904, I

hereby require and direct you to make

available to any financial or unfinancial

member their financial history, including

receipt book copies and that this be done

within twentyfour hours of the member making

the request.

In his affidavit, filed in this proceeding, the returning officer justified this direction in the following terms:

"The irregularity in or in connection with the

election that I hoped to prevent by my first

direction was the situation of incumbent

prospective candidates having easy access to

financial membership records and other

prospective candidates having no such access."

88. As a result of correspondence from Mr. Davis, and from the applicant and another prospective candidate from the reform group, between 17th and 24th November, the returning officer reached a conclusion that not all prospective candidates had been given an opportunity to inspect their personal financial records and that they would not be given that opportunity prior to the date fixed for closing nominations. The returning officer then gave what he described as another direction pursuant to s.170A(1), cancelling the previously advertised date for the closing of nominations, and stating that he would announce a closing date for receipt of nominations as soon as he was satisfied that prospective candidates had had ample opportunity to inspect their personal financial history from the Union's register of members. This purported direction was notified to Mr. Davis by letter dated 24th November, and by newspaper advertisement on 28th November.

89. By separate letters, in standard form, addressed to the branch president, thirteen persons requested access to their financial and membership records for the previous four years. These letters were undated, but copies of them were delivered to the returning officer on 5th December. Eleven of the thirteen received replies dated 8th December 1988; the remaining two received replies dated 12th December 1988. Each reply was from Mr. Davis and each simply said, "A search of the Union's records confirms that you are currently a financial member of the Victorian Branch of the Transport Workers' Union of Australia." The returning officer was not satisfied that the replies constituted sufficient compliance with his first direction, as they contained insufficient information to allow the thirteen prospective candidates to assess their eligibility to stand.

90. In the meantime, Mr. Davis made application to the Industrial Registrar for an inquiry into the election, alleging that the returning officer's direction of 15th November constituted an irregularity in or in connection with the elections. That application was referred by the Industrial Registrar to the Court, and became matter no. VI 57 of 1988. Negotiations then took place between the returning officer and Mr. Davis. On 20th December 1988, agreement was reached that Mr. Davis would forward the financial records of the thirteen persons to them by certified mail on 22nd December that the election inquiry instituted by Mr. Davis would not proceed, and that nominations would close on 30th December 1988 at 12 noon. The returning officer then set a revised timetable for the elections, which involved the closing of nominations on 30th December 1988, and the conduct of a ballot between 10th February and 3rd March 1989.

91. On 22nd December 1988, the inquiry commenced by Mr. Davis was terminated. On the same day, the returning officer received from Mr. Davis a statutory declaration and attached documents, which evidenced the posting by certified mail of the financial records of the thirteen prospective candidates to them on that date. Mr. Davis also undertook to send copies of financial records to other prospective candidates who applied. Others did apply, and copies of their records were posted to them on 23rd December by certified mail.

92. No doubt because of delays in the mail over the Christmas period, not all of the prospective candidates who had applied received their copy financial records by 29th December. On that date, a complaint was made to the returning officer on behalf of the reform group that not all prospective candidates had received the requisite information. A request was made that the timetable be altered further. The returning officer considered this information and complaint, and decided against altering the timetable. A further complaint and similar request was made on the following day, and the returning officer again refused to alter the date for closing nominations.

93. The applicant claimed that the refusal to extend the date for closing of nominations beyond 30th December 1988 amounted to an irregularity in relation to the elections. The basis of this claim was that the reform group should have been given a further opportunity to establish which of its members were eligible to stand for various positions, and to endeavour to nominate sufficient candidates to have a complete "ticket" in the elections.

94. Rule 13 of the rules of the Union provides as follows:

"13 - INSPECTION OF BOOKS

All financial members interested in the funds

of the Union shall be permitted to inspect the

books and register of members at all

reasonable times, on an order signed, as

regards the books of the Federal Council, by

the Federal President thereof, and as regards

the books and register of members of a Branch

or Sub-Branch, by the Branch President of such

Branch or Sub-Branch.

Provided that no such authority shall entitle

a member to inspect any books or register of

members or make any other inspection of the

moveable property of the Union unless the

Secretary concerned is present when the

inspection is being made."

95. A real question arises as to the power of the returning officer to give the direction which he gave on 15th November 1988, as to access to records. That direction was to the branch secretary. It was otherwise than in accordance with rule 13 of the Union's rules. If that rule had been invoked, and had not been complied with, the non-compliance would have been capable of remedy by application to the Court under s.141 of the Conciliation and Arbitration Act 1904. The returning officer only had power to give the direction which he gave if he considered it necessary in order to ensure that no irregularities occurred in or in connection with the elections or to remedy any procedural defects in the rules which appeared to him to exist. The Court does not review directions given by a returning officer under a provision such as s.170A(1). It accepts them, unless they are wrong in law, not a bona fide exercise of the power given by s.170A(1) for the purpose for which it is given, or so unreasonable that no reasonable returning officer could have formed a view which justified them. In the present case, the returning officer has specified what he regarded as the irregularity which he was seeking to prevent. In my view, it was not an irregularity. The fact that some persons, who had not at that stage nominated for any offices in the elections, were not being given access to some of the records of the Union, whether rightly or wrongly, was beyond the scope of the returning officer's consideration. It was no part of the returning officer's function to assist people, who may or may not have become candidates, to ascertain whether they were eligible to become candidates. In Re Federated Liquor and Allied Industries Employees' Union of Australia; ex parte Huxtable [1979] FCA 17; (1979) 40 FLR 418, at p 426, it was made clear that a returning officer exercising statutory powers in relation to an election in a registered organisation does not have the function of giving advice to prospective candidates. Nor, in my view, does the returning officer have any function of assisting prospective candidates to ascertain whether they are or are not eligible. As Northrop J. said in Huxtable, at p 427:

"A member of an organization must decide for

himself whether to nominate for an office or

not. He must look to the rules of the

organization. If he considers he is eligible

to nominate, and he desires to nominate, he

should nominate irrespective of any

expressions of opinion by a returning officer

or any other person. The returning officer

thereafter is under a duty to accept or reject

the nomination in accordance with the rules of

the organization."

The purported direction of 15th November 1988 was therefore wrong in law, and invalid.

96. The returning officer relied on the same justification for his direction of 24th November, cancelling the date for the closing of nominations. In my view, the same conclusion follows. The date for the closing of nominations was fixed by rule 33(e) of the rules of the Union. The returning officer could only override this provision in the rules if he had power to do so under s.170A(1). His conclusion that he did have such power, which was wrong in law, cannot justify a purported direction. The cancellation of the date for closing of nominations was therefore without power. It amounted to a breach of the rules, and to an irregularity in relation to the elections. It affected the results, because persons nominated for various positions after the date which should have been fixed for the closing of nominations. On one view, it would follow that only those who had nominated before 29th November 1988 were validly nominated as candidates, and that no person who nominated after that date should be permitted to participate in the ballot. Because of the actions of the returning officer, however, that result would itself amount to an irregularity. Persons who may have nominated on or before 29th November may have been persuaded not to do so by the returning officer's action in purporting to extend the date for the closing of nominations. It would be grossly unfair to exclude from the ballot persons who had nominated late, in reliance on the returning officer's wrongful act. In the exercise of the discretion given by s. 223(3) of the Industrial Relations Act 1988, I would not make any order with respect to this irregularity.

97. If the returning officer had no power to extend the date for closing of nominations beyond 29th November, it follows that he had no more power to extend that date beyond 30th December, at least if his justification for such a further extension would have been the continued existence of a denial of access to the financial records, which he wrongly thought to have been an irregularity in or in connection with the elections. It follows that the applicant cannot succeed in his allegation that the refusal to extend the date for closing nominations beyond 30th December was an irregularity. Even if this reasoning is incorrect, the same result would follow on other grounds. Just as the Court does not sit to review the correctness of a returning officer's directions under s.170A(1) of the Conciliation and Arbitration Act 1904, so it does not sit to review his refusal to give directions under that provision. An applicant would have to show that a returning officer was absolutely bound to give a direction, in order to establish that an irregularity resulted from the returning officer's failure to do so. Whilst such an irregularity may not be impossible to establish, it would be very difficult.

98. Mr. Bell and Mr. Dalton argued that the question of the validity of the returning officer's direction of 24th November, cancelling the deadline for lodging nominations, had been determined effectively in the election inquiry commenced by Mr. Davis, which was terminated on 22nd December 1988. It is plain that the Court did not examine the merits of that inquiry, but accepted that there was no need for its continuance, as a result of the agreement reached between the returning officer and Mr. Davis. Such an acceptance in no way constitutes a determination of the validity of the returning officer's purported direction.

99. Findings should therefore be made that irregularities happened in relation to the elections the subject of this proceeding, in that the returning officer wrongly refused to accept the nominations of Gary Ross Newman for the offices of committee man and organiser, Rex John Hore for the office of committee man, Barry Raymond Agg for the offices of federal councillor, committee man and organiser, Darren Mark Crump for the offices of federal councillor and committee man and Allen Robert Worley for the office of federal councillor, and wrongly accepted the nomination of Lee Robin Farmer for the office of organiser. Each of these irregularities may affect the results of the elections for those offices. In the case of the rejection of the nominations of Messrs. Newman, Hore, Agg, Crump and Worley the electors would be deprived of opportunities to vote for those persons, whose nominations were valid. In the case of the acceptance of the nomination of Mr. Farmer, votes may be cast for a person whose nomination is not valid, rather than for candidates validly nominated. Accordingly, an order will be made, directing the Industrial Registrar to make arrangements for the conduct of a ballot, including as candidates Messrs. Newman, Hore, Agg, Crump and Worley, and excluding Mr. Farmer. The timetable for such a ballot will be left to the discretion of the returning officer.

100. Because 20th April 1989 is now past, rule 33(q) would have the effect of providing that persons elected will not take office until 20th April 1990. Plainly, the Court should exercise its power under s. 223(3)(d) of the Industrial Relations Act 1988 to modify the operation of the rules of the Union to the extent necessary to enable the uncompleted steps in the elections to be taken. The logical order is for those who are elected to take office immediately upon being declared elected.

101. The applicant applied for an order pursuant to s. 221(1)(d) of the Industrial Relations Act 1988, that Mr. Davis not continue to act in the office of branch secretary pending the completion of the elections. The order was based solely on the evidence that Mr. Davis acted incorrectly in compiling the list of members to be used for the roll of voters (as to which see the judgment delivered on 18th May 1989 in this proceeding) and the allegation that he acted wrongly in frustrating the efforts of potential candidates to inspect the financial records of the Victorian branch of the Union. No attempt was made to lead evidence that Mr. Davis acted from any dishonest motive or with any ulterior purpose. The evidence is consistent with his having acted on his views of the rules. With respect to the compilation of the roll of voters, those views turned out to have been incorrect. There has not been a determination as to the correctness of Mr. Davis's views with respect to the inspection of financial records. In the circumstances, it would not be proper to prevent Mr. Davis from holding over in the office of branch secretary pending the completion of the current elections.