(2022) 320 IR 249
SZTAL v Minister for Immigration and Border Protection (2017) 262 CLR 362
[2017] HCA 34
The application of National Union of Workers NSW Branch
Source
Original judgment source is linked above.
Catchwords
(2022) 320 IR 249
SZTAL v Minister for Immigration and Border Protection (2017) 262 CLR 362[2017] HCA 34
The application of National Union of Workers NSW Branch
By a Summons filed on 26 July 2023, Mutual Banking Employers' Association ("the Association") applied for an order, pursuant to s 227(1) of the Industrial Relations Act 1996 (NSW) ("the Act"), to cancel the registration of the Association. This application was supported by an affidavit of the President of the Association, Ms Leigh Abberton, affirmed on 26 July 2023 ("Ms Abberton's affidavit"). There was no opposition to this application.
This Court has jurisdiction to make the order sought, pursuant to s 355B(e) of the Act.
The Association is an industrial organisation as it is registered under s 221(2) of the Act, having the registration number ER40. The Association has standing to make the application pursuant to s 225(3), because "[a]n industrial organisation may apply for the cancellation of its own registration".
Secretary of the Ministry of Health v The New South Wales Nurses and... [2023] NSWSC 1060 | Case summary | Zoe
Under s 227 of the Act, the Supreme Court may exercise its power to cancel the registration of an industrial organisation if the Court considers that a ground for cancellation has been established under s 226 of the Act.
The ground under which the Association sought cancellation of its registration in this matter is found in s 226(f), namely "that the organisation has applied for the cancellation of its own registration". Under this ground, it must be at least implicit that, where an industrial organisation seeks its own cancellation, it must do so in accordance with its own rules.
The Rules of the Association ("the Rules") as registered with the Industrial Register, (see ss 218(f), 221 and 234 of the Act) were provided in Annexure B of Ms Abberton's affidavit and Rule 15, Dissolution provides that the Association may be dissolved in accordance with the following procedure:
(a) members in a general meeting:
(i) pass a special resolution to dissolve the association; and
(ii) adopt by resolution proposals providing for distribution of the assets and funds of the association
(b) the association conducts a secret postal ballot of members in which at least 75% of members approve:
(i) the dissolution; and
(ii) the proposals adopted by the general meeting for the distribution of the assets and funds of the association
The evidence reveals that the Association's application is made in conformity with those provisions of its Rules and accordingly the ground in s 226(f) is satisfied.
A special general meeting was called for 31 March 2023 where a special resolution was passed to dissolve the Association, and following dissolution, distribute any surplus assets of the Association to The Australian Mutuals Foundation Limited (ACN 602 774 434) ("AMFL"). It was also determined that if the secret postal ballot is passed to dissolve the resolution with a 75% majority, then the Association will apply to the Court for cancellation. These resolutions conformed with Rule 15(1)(a).
A secret postal ballot was then conducted between 21 April 2023 and 19 May 2023 which resulted in a vote of 15 out of the 18 members remaining in the Association in favour of dissolution. As such, 15(1)(b) of the Rules was satisfied as at least 75% of the Associations members approved the dissolution (and the proposal for the distribution of remaining assets and funds).
Notwithstanding the satisfaction of s 226(f), counsel for the applicant, Dr O'Shea submitted that the Court may have a discretion under ss 226 or 227. Reference was made in that respect to The application of National Union of Workers NSW Branch; in the matter of Industrial Relations Act 1996 (NSW) [2022] NSWSC 1437 where Hamill J at [7] mentioned the existence of such a discretion.
Although I do not wish to express a concluded view as to that matter, because it is clear that any existence of a discretion would favour the grant of the application, I propose to make some brief observations as to the existence of a discretion beyond those expressed in my last decision: Re: The Newcastle Master Builders' Association [2023] NSWSC 868 (Per Walton J) at [24].
The use of the word 'may' in ss 226 and 227 is suggestive that the word has its ordinary meaning and thereby confers a discretion. In any event, the statutory context strongly supports construing s 227 (and s 226) as conferring a discretion upon the Court (see SZTAL v Minister for Immigration and Border Protection (2017) 262 CLR 362; [2017] HCA 34 (per Kiefel CJ, Nettle and Gordon JJ) at [14]) for the following reasons:
1. The registration of industrial organisations is essential to the effective operation of the Act: Secretary of the Ministry of Health v The New South Wales Nurses and Midwives' Association [2022] NSWSC 1178; (2022) 320 IR 249 at [614]-[615]. This is made clear by the objects of the Act in s 3(d) and other essential provisions such as ss 11(2)(b) and 130(1)(a).
2. Whilst the Court does not have jurisdiction to register industrial organisations per se, the Court has a supervisory or regulatory role with respect to registered organisations such as those residing in s 355B(e) (Pt 3, Registration of Organisations, Pt 4, Regulation of State Industrial Organisations and Pt 5, Regulation of Industrial Organisations (other than state organisations).
3. While cancellation in this case was self-activating, the Court's power in this respect is central to the regulation of industrial organisations under the Act. This is evident in light of other grounds in s 226 that gives power to the Court to, for example, decide that a substantial number of an industrial organisation's members have contravened the industrial relations legislation or any industrial instrument or any order of the Supreme Court (s 226(a), decide whether an organisation is defunct (s 226(g)) or whether an organisation was registered by mistake (s 226(d)).
4. The existence of a discretion in the Court is, therefore, the corollary of the Court's powers and functions with respect to registered organisations under the Act.
Lastly, it is clear that there are substantial discretionary factors in favour of the granting of this application. These are as follows:
1. In May 2022, there was a significant change in the relationship between the Association and the Australian Federation of Employers and Industries ("AFEI"). Up until this date, the AFEI had an agreement with the Association that provided the Association with secretarial and administrative services as well as access for their members to use the AFEI phone hotline to receive advice about industrial relations and employment related issues. The ceasing of this relationship between the AFEI and the Association, as I understand it, reduced the capacity of the Association to operate effectively, although I note, Ms Abberton's affidavit specified that an analysis of this service revealed that only a handful of members had been actively using the hotline before May 2022.
2. Membership of the Association is in decline. This created financial difficulties for the Association and made it difficult to continue operating. Subsequently, the capacity of the Association to represent its members effectively is greatly reduced. As mentioned, at the time of the hearing, the Association had 18 members, reduced from 80 when the Association was established in 1974. The Association waived membership subscriptions fees for the 2021/2022 financial year, where an operating loss was reported, and no longer receives such subscriptions.
3. The Association has experienced difficulty in filling vacant councillor positions, which is likely a consequence of the decline in membership.
4. There are no current matters initiated by the plaintiff or involving them before the Industrial Relations Commission of New South Wales.
5. The Association has no outstanding debts or liabilities.
6. The Association does not employ any persons.
7. The Association has appropriately come to a resolution, as part of the Special Resolution of 31 March 2023, to distribute the Associations remaining funds to AMFL. The distribution of those funds to the AMFL aligns with the Associations object, namely, "to promote the interests of the members of the Association" as the AMFL is a charity that assists in the training of persons in the industry. This satisfies s 228(3)(c) of the Act that requires any surplus assets or property to be "held and applied for the purposes of the organisation under the rules of the organisation so far as they can still be carried out or observed".
In the result, the Court makes an order, pursuant to s 227(1) of the Act, that the registration of the Association, as an industrial organisation, be cancelled, effective from 11 September 2023.
The Court also orders that a copy of these reasons will be provided to the Principal Registrar for the purposes of the notification which the Principal Registrar is required to make to the Industrial Registrar under s 231A(b) of the Industrial Relations Act 1996 (NSW).
[3]
Amendments
04 September 2023 - Typographical error
04 September 2023 - Typo error
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Decision last updated: 04 September 2023
Parties
Applicant/Plaintiff:
Secretary of the Ministry of Health
Respondent/Defendant:
The New South Wales Nurses and Midwives' Association