The MEAA NSW. Application by The MEAA NSW for a determination of the question of an invalidity under s 288 of the Industrial Relations Act 1996 [2009] NSWIRComm 80

Judgment (10 paragraphs)

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CITATION: The MEAA NSW. Application by The MEAA NSW for a determination of the question of an invalidity under s 288 of the Industrial Relations Act 1996 [2009] NSWIRComm 80

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PARTIES: APPLICANT: The Media Entertainment and Arts Alliance New South Wales

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CATCHWORDS: Registered organisation - application for determination of invalidity - Industrial Relations Act 1996 - s 288 - failure to hold elections in State registered organisation - practice of Federal Branch officers assuming equivalent position in State organisation - Federal organisation restructure not reflected in rules of State organisation - few equivalent offices - failure to hold valid elections since 2004 - failure to lodge financial returns and comply with provisions of Industrial Relations Act concerning organisations - Branch Council meets and authorises changes to rules to reflect structure of Federal Branch - invalidity found in management and administration of organisation - invalidity in election of offices and in alteration of rules - proposed orders would not do substantial injustice to members of the organisation or a creditor or any other person having dealings with the organisation - form of proposed orders varied - declaration and orders made to rectify the invalidities and validate decision to alter rules

1 The Media Entertainment and Arts Alliance New South Wales ("the State Alliance") is a State union registered and recognised under the provisions of the Industrial Relations Act 1996 (NSW). It is closely associated and connected with the New South Wales Branch of the Federally registered Media Entertainment and Arts Alliance ("the Federal Alliance") The State Alliance, pursuant to s 288 of the Industrial Relations Act has applied to the Court claiming that an invalidity or invalidities have occurred in its management and administration between March 2003 and to the present time. Essentially, the application is based upon the fact that elections for offices in the State Alliance had always been treated as counterpart offices to the equivalent offices in the related Federal Alliance but the offices were no longer true counterparts because of changes in the rules of the Federal Alliance that had, by oversight, not been reflected in the rules of the State Alliance. It was proposed that, on the finding of an invalidity, the purported elections of persons now treated as the executive of the Alliance be validated. 2 The application by the State Alliance was supported by an affidavit of Mr Mark Ryan, Assistant Federal Secretary of the Federal Alliance who also had responsibility for the operation of the State Alliance. As was made clear in submissions, Mr Ryan is a member of the Federal and State registered unions and had been authorised by the State Alliance to make the application. Mr Ryan spoke of becoming aware of these invalidities and determining that it would be necessary to adopt revised rules that restored harmony between the rules of the Federal Alliance and the State Alliance. In September 2008 the Branch Council of the State Alliance had met and resolved to adopt new rules and authorised him to take all necessary steps to apply to the Court on behalf of the State Alliance to cure the invalidity occurring in the management and administration of the State Alliance. Minutes of the Branch Council of the State Alliance held on 18 September 2008 were annexed to Mr Ryan's affidavit. That meeting not only considered legal advice but also correspondence from the the New South Wales Industrial Registrar concerning invalidities that had arisen in the management and administration of the State Alliance because of a restructure carried out under the rules of the Federal Alliance that had not been reflected in the rules of the State Alliance. The meeting adopted revised rules and authorised Mr Ryan to make this application to the Court. 3 On the first mention of this matter the Court made directions that an advertisement be placed in the public and legal notices section of a metropolitan daily newspaper advising of the nature of the application and inviting any person who claimed an interest in the proceedings to appear at a time specified in the advertisement and also to contact the Deputy Industrial Registrar on a nominated telephone number. The same notice was also placed within the E-Bulletin circulated amongst New South Wales members of the Federal and State Alliances. At the hearing of the application no person sought to appear to be heard in opposition to the application. 4 On the hearing of the application an affidavit provided by Mr Richard Harris was read. He was the New South Wales Brach secretary of the Federal Alliance and also had responsibility for the operation of the State Alliance. He spoke of the operation of the two unions being conducted as one organisation. With the introduction of the Work Choices legislation the overwhelming number of employers of union members were under the Federal system and there were very few members employed by non-corporate employers. There were six State awards (NAPSA's), serviced by the State Alliance with four in the entertainment and broadcasting industry and two operating in the field of journalism. The residual coverage of non-corporate employers was minimal. The State Alliance retained industrial award and agreement coverage of two significant New South Wales public sector employers in relation to Hansard reporters and a wide range of technical, front-of-house and related employees employed at the Sydney Opera House. 5 Mr Harris provided a document setting out the financial position of the union as at 30 June 2007 showing that there were no accumulated funds and no current assets, no receipts and no payments. There were no creditors. The balance sheet and audit for the 2007/2008 period had not yet been carried out but Mr Harris stated that, since 2003, the audit results had been the same and he knew of no reason why the 2007/2008 audit would not show precisely the same position. 6 Under the current records held by the Alliance, there were some 7,770 members of the New South Wales branch of the Alliance and these members were treated as members of the State Alliance under the rules of the union and in conformity with longstanding practice. Of these the Alliance had email addresses for over 5,000 members and they had received the E-Bulletin notifying them of the present proceedings. In addition, Mr Harris confirmed that the September 2008 meeting of the Branch Council of the State Alliance had resolved to adopt new rules and had authorised Mr Ryan to take the necessary steps to have them apply to the State Alliance. Mr Harris said that the union had transacted no other business for many years because all relevant matters had been attended to by the Federal branch of the Alliance. 7 In November 2008 the Australian Electoral Commissioner declared the result of the election for officers of the New South Wales Branch of the Federal Alliance under the Workplace Relations Act. In that election the branch President and three Vice-Presidents were elected unopposed. Mr Harris' position as branch secretary was not dealt with in that election as he was elected in April 2007 with a four-year term. 8 Also tendered in the proceedings were letters from the Court Registry dealing with non-compliance with provisions of the Industrial Relations Act by the State Alliance. In that correspondence it was noted that the rules of the State Alliance provided that persons elected to office in the New South Wales Branch of the Federal Union could be taken to be elected to the corresponding offices in the State Union but to achieve that result the State union had to observe the provisions of rule 16, Conduct of Elections, and have corresponding offices exist in the two organisations. That and other correspondence urged the State Alliance to bring its rules into conformity with those of the Federal Alliance but also noted that there would be a need to address the validity of the union's office holders from 2004. Since that time no approval had been granted for the persons elected to office in the New South Wales Branch of the Federal Alliance to be taken as validly elected to corresponding offices in the State registered Alliance. Throughout the correspondence, the State Alliance was advised that, for some years, elections had not been properly held under its rules and that not only did the rules require attention, but consideration needed to be given to validating the position of the current officers and any decisions made by them, 9 The proposed new rules of the State Alliance were placed before the Court as an annexure to Mr Ryan's affidavit. Under these rules, rule 16 provided that each of the persons elected from time-to-time to offices in the New South Wales branch of the Alliance (being the Federally registered union) would be taken to be validly elected to the corresponding office of the union so long as certain membership requirements were met and so long as the rules of the State branch of the Federal organisation in relation to the election of officers complied substantially with the requirements relating to election of office holders under the Industrial Relations Act 1996 (NSW). From the information before the Court, those rules appear to operate so as to reflect the structure of the Federal branch of the Alliance operating in New South Wales. 10 On the hearing Mr J Nolan of counsel appeared for the applicant Alliance. The affidavits were formally read and other relevant documents tendered. Mr Nolan helpfully provided a detailed written submission setting out the history of the matter and addressing the legal issues arising under an application made in accordance with s 288 of the Industrial Relations Act 1996. 11 In the submission it was stated that the State Alliance was, for all intents and purposes, a counterpart of the New South Wales Branch of the Federal Alliance. The State Alliance had no employees and had always been run by office holders who held corresponding offices in the Federal Alliance. The State Alliance had no premises or property. It was pointed out that the evidence before the Court indicated that no injustice would be done to the union, any member, creditor or any other person having dealings with the union if those orders were made. DELIBERATION 12 It was submitted that the principles applicable to applications of this kind had been appropriately considered by the Court in Re Seamens' Union of Australia, New South Wales Branch [2001] NSWIRComm 151 and Liquor Hospitality and Miscellaneous Union, New South Wales Branch [2006] NSWIRComm 244. That line of authority was further supported by decisions in the Australian Liquor Hospitality Miscellaneous Workers Union, New South Wales Branch [1999] NSWIRComm 217 and Merchant Service Guild of Australia, Queensland Branch, Union of Employees [2005] QIRComm 191, a case dealing with the equivalent provisions under Queensland legislation. The Court accepts that the Seamen's' Union case and the 2006 Liquor Hospitality and Miscellaneous Union case sets out the approach to be adopted in cases brought under s 288 and in regard to this application, the Court will be guided by those statements of principle. 13 Applying those principles the Court is firstly to consider whether an invalidity has occurred in relation to the matters described in s 288(1)(a)(b) or (c) of the Act. Section 288 of the Act is in the following terms:

288 Commission may make orders in relation to consequences of invalidity. (1) An organisation, a member of an organisation or any other person having a sufficient interest in relation to an organisation may apply to the Commission for the determination of the question whether an invalidity has occurred in: (a) the management or administration of the organisation, or (b) an election or appointment in the organisation, or (c) the making or alteration of the rules of the organisation. (2) On an application under subsection (1), the Commission may make such determination as it considers appropriate. (3) If, in a proceeding under subsection (1), the Commission determines that an invalidity of a kind referred to in that subsection has occurred, the Commission may make such order as it considers appropriate: (a) to rectify the invalidity or cause it to be rectified, or (b) to negative, modify or cause to be modified the consequences in law of the invalidity, or (c) to validate any act, matter or thing rendered invalid by or because of the invalidity. (4) Where an order is made under subsection (3), the Commission may give such ancillary or consequential directions as it considers appropriate. (5) The Commission must not make an order under subsection (3) without satisfying itself that such an order would not do substantial injustice to: (a) the organisation, or (b) any member or creditor of the organisation, or (c) any person having dealings with the organisation. (6) The Commission may determine: (a) what notice, summons or rule to show cause is to be given to other persons of the intention to make an application or an order under this section, and (b) whether and how the notice, summons or rule should be given or served and whether it should be advertised in any newspaper. (7) This section applies: (a) to an invalidity whenever occurring (including an invalidity occurring before the commencement of this section), and (b) to an invalidity occurring in relation to an association before it became an organisation. 14 On the evidence before the Court there has been an invalidity in relation to the management and administration of the organisation. In accordance with the Alliance's rules, the governing body since approximately 2004 has failed to make an application to the Registrar to treat the offices elected in the New South Wales Branch of the Federal Alliance as being elected to "equivalent" office in the State Alliance. The rules of the Federal Alliance were then altered so that there was not a harmonious equivalence of offices in the New South Wales Branch of the Federal Alliance and the State Alliance. These two invalidities have resulted in there being no properly elected officials in the State Alliance since 2004. That had the consequential effect that the purported decision of the Branch Council in 2008 to amend its rules so as to bring about harmony of provisions with the Federal Alliance rules was a decision made by a body that had no authority to make that decision. The endorsement of this very application by the same body suffers from the same difficulty. The Court readily accepts the applicant's evidence and the submissions that there has been invalidity under s 288(a), (b) and (c) being invalidity in the management and the administration of the State Alliance, in an election in the State Alliance and in the making or alteration of the rules of the State Alliance. 15 Having determined that there has been such invalidities, the applicant seeks the following orders: 1. A declaration that an invalidity has occurred in the management and administration of the Media Entertainment and Arts Alliance, New South Wales ['the organisation'] between March 2006 and the date of this order, in that: (a) The organisation has failed to comply with its registered rules and the relevant statutory provisions concerning the election of office holders and terms of office; (b) no application has been made to the Industrial Registrar by the organisation for an election to be conducted, or that it receive a dispensation to treat the corresponding officers of its federally registered counterpart as the officers of the organisation; (c) the organisation has failed to comply with relevant statutory provisions concerning the preparation, certification, audit, distribution, presentation and lodgement of financial accounts; (d) the organisation has failed to comply with relevant statutory provisions concerning the preparation, certification, audit, distribution, presentation and lodgement of financial accounts. 2. Under s 288 of the Industrial Relations Act 1996 that the purported election of the NSW Branch Council member of the organisation declared on 21 November 2008 [Namely: President, Tina Bursill, Vice Presidents, Chloe Dallimore, Marcus Strom and Jennifer Ward], and that the purported election of the NSW Branch Secretary of the organisation, Richard Harris, declared in April 2007 be, and are hereby, validated. 3. That the NSW Branch Council shall hold office until their successors are elected. 4. A declaration that the Commission is satisfied that the making of orders herein will not do injustice to the union or any member or creditor of the union or to any person having dealings with the union. 16 Prior to making those orders the Court is required to consider the operation of s 288(5), namely, such proposed orders under s 288(3) must not be made unless the Court is satisfied that such an order would not do substantial injustice to the organisation or any member or creditor of the organisation or any person having dealings with the organisation. In this matter the nature of the application has been advertised in the public notices of the Sydney Morning Herald and has also been publicised to the members by way of their email bulletin. Those steps having been taken, the Court is satisfied that sufficient notice has been given to any person likely to have an interest in the application. Having regard to the history of how the State Alliance operates the Court is satisfied that in fact there are no creditors and in any event, if there were creditors from a past era the proposed orders would not do substantial injustice to those creditors. In relation to the members of the organisation it appears to the Court that rectifying the identified invalidities is of positive assistance to the State Alliance and its members and no injustice will flow as a result of the orders being made. There is nothing in the evidence to suggest that any other person having dealings with the State Alliance would suffer substantial injustice because of the proposed orders. There is a public interest, in the sense there is a registered union covering a significant number of employees that seeks to properly operate within the system of industrial regulation established by the Industrial Relations Act 1996 and to the extent that participation is inhibited or nullified by the identified invalidities, those invalidities should be cured. Further, the provisions of the Industrial Relations Act 1996 and its objects are designed to ensure that registered organisations function and operate effectively and making the orders will assist in achieving that result as well as achieving the object of s 3(d) of the Act. The Court also accepts the applicant's submissions that there is nothing before the Court to suggest that those responsible for the invalidity acted other than in a bona fide way and there was no evidence that the invalidities arose as a result of a knowing or deliberate act on the part of any officers of the State Alliance. They appear to have arisen because of oversight. Once it was fully brought to the attention of the State Alliance that the omissions had a quite fundamental effect on the organisation, steps were taken to rectify the deficiencies in the affairs of the union and the those steps themselves require validation. 17 Having regard to all those matters the Court is satisfied that all requirements of s 288 have been met. Further, considering the evidence before the Court a modified version of the orders sought shall be made: 18 The Court makes the following orders: 1. A declaration that an invalidity has occurred in the management and administration of the Media Entertainment and Arts Alliance New South Wales ['the organisation'] between March 2004 and the date of this order, in that: (a) The organisation has failed to comply with its registered rules and the relevant statutory provisions concerning the election of office holders and terms of office since 2004; (b) no application has been made to the Industrial Registrar by the organisation for an election to be conducted, or that it receive a dispensation to treat the corresponding officers of its federally registered counterpart as the officers of the organisation; (c) the organisation has failed to comply with relevant statutory provisions concerning the preparation, certification, audit, distribution, presentation and lodgement of financial accounts; (d) the organisation has purported to alter its rules, subject to approval as required, through the Branch Council, a body that has not been properly elected under the rules since 2004. 2. (i) an Order made pursuant to the provisions of s 288 of the Industrial Relations Act 1996 that the purported election of the NSW Branch Council members of the organisation declared on 21 November 2008 [Namely: President, Tina Bursill, Vice Presidents, Chloe Dallimore, Marcus Strom and Jennifer Ward] and that the purported election of the NSW Branch Secretary of the organisation, Richard Harris, declared in April 2007 be and is hereby validated; (ii) the NSW Branch Council constituted pursuant to order 2(i) herein shall hold office until their successors are elected in accordance with the rules of the organisation; (iii) the decisions taken by the Branch Council of the organisation on 18 September 2008 be declared to have been duly made and authorised under the rules of the organisation registered under the Industrial Relations Act 1996 be and are hereby validated; (iv) a declaration that the Commission is satisfied that the making of orders herein will not do injustice to the union or any member or creditor of the union or to any person having dealings with the union.

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Judgment (10 paragraphs)

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