Re Election for Office in the Construction, Forestry, Mining and Energy Union; Ex parte Sutton [2002] FCA 971

If a ballot is necessary, voting material will be posted on 29 May 2002 to the Delegates to all of the Divisional Conferences of the Union. The ballot would close at 12 noon on Friday, 14 June 2002. Changed address? Advise the Union now. Ian Henry 23 April 2002 Returning Officer Telephone: (02) 9375.6346" 6 Mr John Sutton is also the National Secretary of the Construction and General Division of the CFMEU. I will return to explain Divisions later. On 23 April 2002 John Sutton communicated with all Divisional Branch Delegates to the Construction and General Division Divisional Conference as follows: "Re: Election of National Officers The election of the CFMEU's National Officers will shortly be conducted in accordance with the National Rules of the Union. Under Rule 16 of those rules, each Division is to decide its nominees for those National positions by resolution of the Divisional Conference of those Divisions. The three leading positions are Secretary, Assistant Secretary and President. The rules provide that these three positions must be shared between Mining, Construction and Forestry. You will be aware that the present incumbents are National Secretary (John Maitland), National Assistant Secretary (John Sutton) and President (Trevor Smith). The Construction & General Division is also entitled to one of three Joint Vice-President positions. These Vice-Presidents' responsibilities are outlined in the Rules. Attached is a proposed resolution in relation to the positions of National Assistant Secretary and Joint Vice-President (Construction & General Division). Please complete this ballot paper and return it to this office as a matter of urgency but in any event by no later than 5.00pm Thursday 2nd May 2002." 7 The resolution which was circulated was as follows: "In accordance with National Rule 16, Election of National Officers, it is hereby resolved that the CFMEU Construction and General Division nominees for National Officers positions shall be as follows: National Assistant Secretary - John Sutton Joint Vice-President (Construction & General Division) - Andrew Ferguson" Of the fifty persons entitled to vote, thirty seven returned ballot forms, with twenty seven in favour and ten against. 8 On 9 May 2002 the Construction and General Division of the CFMEU informed the Returning Officer that the Division's National Conference had decided that its nominee for the office of National Assistant Secretary was Mr John Sutton. A nomination of Mr Sutton, signed by two nominators, had been lodged. Prior to the close of nominations at 12 noon on 10 May 2002 the Returning Officer also received a nomination of Mr Martin Kingham for the office of National Assistant Secretary signed by two nominators. 9 By letter of 17 May 2002 the Returning Officer advised the Executive Officer of the CFMEU of the receipt of both the above (and the only) nominations for the office of National Assistant Secretary, and sought information which was said to be relevant to determining the eligibility of the nominees and their nominators. By letter of 21 May 2002 the National Secretary of the CFMEU wrote to the Returning Officer, drawing attention to the fourth paragraph of Rule 16(i), advising that the Construction and General Division had decided that its nominee for the position of National Assistant Secretary should be Mr John Sutton, and suggesting that the nomination of Mr Martin Kingham was invalid. The implication in this letter is that Mr Kingham was a member of the Construction and General Division of the CFMEU. As this is referred to in other evidence, I will proceed upon that basis. The Returning Officer responded by maintaining the view that Mr Kingham's nomination was valid, but inviting comments. 10 On 28 May 2002 Mr Sutton made application to the Court pursuant to s 218 of the Act for an inquiry, on the basis that there had been an irregularity in relation to the election by reason of the acceptance of the nomination of Mr Kingham for the office of National Assistant Secretary. I was satisfied, pursuant to s 219, that an inquiry should be conducted and made orders for that purpose. Mr Kingham was represented during an interlocutory hearing. 11 By letter dated 7 June 2002 Mr Kingham wrote to the Returning Officer in the following terms: "I hereby withdraw my nomination for the position of CFMEU Assistant National Secretary." The Returning Officer refused to accept that withdrawal because of the operation of the provisions of the following part of Rule 17(iii)(g) of the Rules of the CFMEU:

"A member having nominated for any office in accordance with this Rule may withdraw the nomination by notifying the Returning Officer in writing of an intention to do so at any time up to seven (7) days after the closing of nominations." Rule 17 is relevant because of the provisions of the first paragraph of Rule 16(i). 12 It is now claimed on behalf of Mr Sutton that the refusal of the Returning Officer to accept the withdrawal was an irregularity in connection with the election. Mr Kingham took no part in the proceeding after 7 June 2002. Indeed, the only represented parties have been Mr Sutton, on the one hand, and the Returning Officer, on the other. This is somewhat awkward, as there is no active contradictor with an interest in the outcome, although those representing the Returning Officer have put full arguments to support the position of the Returning Officer, a course which I regard as appropriate in the circumstances. 13 Mr Sutton now contends that there have been other irregularities in connection with the election, namely: "An irregularity has happened because the Returning Officer fixed a time for the opening and closing of nominations and the conduct of the ballot which was in breach of the Rules of the Organization namely Rule 16(i) importing, mutatis mutandis, the provisions of Rule 17 of the National Rules and, in particular, Rule 17(iii)(e), (g), (o), (p) and (r)." 14 It is also claimed by Mr Sutton that the failure of the Construction and General Division of the CFMEU to decide its nominee prior to the opening of the nominations was an irregularity, although no relief is sought in relation to it. 15 The fundamental issue which requires determination is the claimed irregularity concerning the acceptance of the nomination of Mr Kingham. I shall deal with that issue first. The contention for Mr Sutton is that the effect of Rule 16(i) is that holders of, and so nominations for, the office of National Assistant Secretary are limited to the nominee of a Division chosen by resolution from the National Conference of the Division. It is contended for the Returning Officer that any delegate to any Divisional Conference of the Union can be a nominee for any national office and can be nominated by any two members of the Union. 16 It is necessary to consider Rule 16(i) as part of the Rules as a whole. The structure of the CFMEU involves Divisions and Branches. Divisions are occupational and Branches are geographic. In a further complication, there are branches of Divisions, which may be geographic, occupational or on an area basis. Included amongst the Rules governing Divisions are the following:

"27 - DIVISIONS (i) There shall be Divisions of the Union established, in accordance with the rules of the Union. Such Divisions shall be established on a basis of industry or occupation. (ii) Each Division shall have autonomy to decide matters which do not directly affect the members of another division without any interference by any other body within the Union, including but not limited to: (a) The industrial interests of its members. (b) The election of officers within the Division. (c) Matters arising from the Objects of the Division. (d) Structure of the Division. (iii) Each division shall have autonomy in relation to its funds and property. (iv) Each Division shall have rules and have power to make, alter or rescind such rules, to be called Divisional Rules. Without limiting the generality of the foregoing paragraph, each Division shall have power to determine policy for that Division, not inconsistent with the rules and policy of the Union as decided by National Conference or National Executive. … (vi) Divisions shall, in accordance with their rules, have Branches along a geographic, occupational or area basis which branches of a Division will be called Divisional Branches and may have more than one divisional branch in a State or Territory divided on a geographic or occupational basis." 17 It is apparent from Rule 42, which contains transitional provisions, that the CFMEU was the result of an amalgamation of a number of former unions. Although the Divisions which now exist are somewhat rearranged from the earlier position, the occupational divide and the high degree of autonomy given to Divisions is clearly the product of this amalgamation and the de facto federation which that involved. 18 The supreme governing body of the CFMEU is the National Conference, which is convened every two years or specially. It consists of all of the members of each and every Divisional Executive for every Division of the Union. Persons elected as members of the Divisional Executive are to be elected in accordance with the Rules of the Division. (See Rule 13) 19 There is a National Executive Committee consisting of the National Principal Officers, being the National President, National Senior Vice-President from the FFTS Union Division, National Secretary and the National Assistant Secretary and a full-time elected officer of each Division at a national level who is not one of the National Principal Officers. This body (subject to the review of its actions by the National Executive) has the care, control, superintendence, management and administration of the affairs, business and national funds of the Union. (See Rule 14) 20 The National Executive is composed of the National Executive Committee and the Principal Officer of each Divisional Branch of the Union who is not otherwise a member of the National Executive Committee and (subject to National Conference) has the care, control, superintendence, management and administration in all respects of the affairs, business, national funds and property of the Union. (See Rule 15) 21 Rule 17 governs the election of delegates to Divisional Conferences, in accordance with the Rules of the Division, every four years by secret postal ballot of the whole of the Divisional Branch financial members entitled to vote (insofar as the Construction and General Division is concerned). Rule 18 deals with the Divisional Executive and provides as follows: "18 - DIVISIONAL EXECUTIVE ELECTION (i) There shall be a Divisional Executive composed in accordance with Divisional Rules and elected in accordance with such Divisional Rules. (ii) Every Divisional Executive shall be elected either: (a) by and from the Divisional Conference; or (b) by direct ballot of the financial members of the Division. (iii) The Divisional Officers at a national level shall be members of that Divisional Executive. (iv) The position of delegate to National Conference is to be held by the same person as is holding the position as Divisional Branch member of the Divisional Executive and the election to one position is to be an election to the other position, a removal from one position shall be a removal from the other and they are, for all purposes under these rules to be one and the same person and/or position." 22 The duties of National Officers are set out in Rule 22. The only full-time office is that of the National Secretary. 23 With this background in mind, I prefer the construction of Rule 16 advanced on behalf of Mr Sutton, at least insofar as the present controversy is concerned. I recognise the force of the submission put on behalf of the Returning Officer concerning the effect of the first paragraph of Rule 16(i). However, it seems to me that the balance of the Rule constitutes a very careful representation and power-sharing exercise, bearing all the hallmarks of the kind of negotiated compromise which would be expected in the case of an amalgamated federation. In my opinion, the second and fourth paragraphs of Rule 16(i) have the effect that the holder of the office of National Assistant Secretary must be the nominee of a Division with more than one Divisional Branch. In the events which have happened, the only nominee for the position of National Assistant Secretary who answers that description is Mr Sutton. Mr Kingham does not answer that description. I should add that there is no suggestion that Mr Kingham was a nominee of any other Division. In saying this, I am not suggesting that it would have been open to another Division to nominate Mr Kingham. 24 I recognise that there may be difficulties in applying Rule 16(i) where there is more than one nominee for each national office, but that problem does not arise in this case. For present purposes, even if there were such a difficulty, it would not overcome what, to my mind, is the clear intent of the second and fourth paragraphs of Rule 16(i) when understood against the background of the structure and governance of the CFMEU. 25 Counsel for the Returning Officer referred to various provisions of the Act which, it was said, encourage democracy in the affairs of registered organisations. This may be accepted at a very general level. However, counsel did not identify any section of the Act which would render the Rules as construed by Mr Sutton invalid. Even if the expansive view of the role of the Court in an Inquiry of this nature taken in Re Churchill (2001) 109 FCR 104 is correct, there is, in this case, no claim of invalidity and no concurrent application pursuant to s 208 of the Act. Indeed, as pointed out by counsel for Mr Sutton, the Returning Officer has no obvious interest in, or standing to make, any such challenges to the Rules. The Australian Electoral Commission has a limited (but important) role in relation to the conduct of elections, but has no wider role in relation to registered organisations. The rules of an organisation are primarily the concern of the members of the organisation, although the Industrial Registrar has an important role in relation to rules generally. 26 In any event, counsel for Mr Sutton does not accept that the Rules are undemocratic. He points to the rank and file involvement in the election of the delegates to Divisional Conference and also points to the Divisional election of the nominee for National office. This submission illustrates that there can be more than one view taken as to the best method of attaining the objects of the Act, and I do not see it as my role in this Inquiry to express any view as to the preferred approach. 27 I am thus satisfied that there was an irregularity as alleged in the nomination of Mr Kingham having been accepted. I am also satisfied that as a result of this irregularity the result of the election may be affected. The principal relief sought pursuant to s 223 of the Act is an order declaring that the calling for and acceptance of nominations for the office of National Assistant Secretary of the CFMEU should be declared void and that the Industrial Registrar be directed to make arrangements for the calling of nominations and for all other steps in the election to be taken. This relief should be granted. This conclusion renders it unnecessary to consider the other irregularities which have been alleged. I certify that the preceding twenty-seven (27) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Gyles.

Counsel for Mr Sutton: S Rothman SC and M Perry

Solicitor for Mr Sutton: Taylor & Scott

Counsel for the Returning Officer: G Johnson on 29, 30, 31 July 2002

Solicitor for the Returning Officer: J Heard of the Australian Government Solicitor

Date of Hearing: 7, 18 June, 29, 30, 31 July 2002