Transport Workers' Union of New South Wales v Patrick Murray

Transport Workers' Union of New South Wales v Patrick Murray - [2008] NSWIRComm 6 - NSWIRComm 2008 case summary — Zoe

[45]

23 Section 263(5) provides that a member is "entitled to inspect the accounting records of the organisation…" To be entitled is to have a right or claim to something (see Macquarie Dictionary definition). In the context of corporation law a "right" has been regarded as synonymous with a "power". Thus in BWN Industries Pty Ltd v Downey and Another (1993) 11 ACSR 777, the Court was concerned with the right of a member to call a general meeting of a corporation. At 783 Hayne J stated: Lastly, it was submitted that the resolutions to be proposed at the meeting are resolutions the passing of which would be beyond power as being either a fraud on the minority or oppressive, and that accordingly there is no power in the Commonwealth Bank of Australia to cause Secton to requisition a meeting or call a meeting to consider and if thought fit to pass such resolutions. Reference in this regard was made to Humes Ltd v Unity APA Ltd (No 1) [1987] VR 467; Re Ariadne Australia Ltd [1991] 2 Qd R 377; (1990) 2 ACSR 791; 8 ACLC 1000, and Adams v Adhesives Pty Ltd (1932) 32 SR (NSW) 398. No doubt the right of a member to requisition a meeting is subject to at least one restriction; it is subject to the general limitation on any power that the power is to be exercised by the purpose for which it is given, See for example, Mills v Mills (1938) 60 CLR 150. In the present context that limitation means, in my view, that the power to requisition and call a meeting must be used for the purpose of seeking the convening of a meeting at which particular resolutions will be considered and voted upon, and it may not be used for a purpose, for example, of simply harassing the company…. 24 The proposition that the right of a member to requisition a meeting is subject to the general limitation on any power, that is, the power is to be exercised for the purpose for which it is given, was stated in the context of a commercial corporation. Similar propositions have been stated in the same context: see Mills and Others v Mills and Others (1938) 60 CLR 150 at 185 per Dixon J regarding the duty of directors; see Humes Ltd. v Unity APA Ltd. and Another (No. 1) [1987] VR 467 regarding the power of minority shareholders to requisition a general meeting of a company and where it was stated that the right to do so "must be exercised bona fide and for the purpose for which it was conferred" per Beach J at 470; see Ngurli Limited and Another v McCann and Another (1953) 90 CLR 425 at 438 where the High Court stated: "But the powers conferred on shareholders in general meeting and on directors by the articles of association of companies can be exceeded although there is literal compliance with their terms. These powers must not be used for an ulterior purpose".

[50]

(c) no copies may be made or documents removed without the written authority of the relevant Secretary. 32 At [30]-[36] Mansfield J considered whether there was implied into r 59(3) some restriction upon its express words by reference to the purpose for which a member sought to inspect certain records: [30] The question whether r59(3) should entitle Mr Thomas to the right to inspect the membership records, given the clear purpose of his request is to assist him and his ticket in campaigning in the election, is a more difficult one. On one view, r59(3) is quite straightforward and it applies in the present circumstances. As counsel for Mr Thomas submitted, the words of r59(3) are plain. The Rule, by the use of the word "must", obliges the Secretary to make the records available for inspection. It is not a qualified right. The express restrictions on the exercise of that right are contained in the three provisos. There are, however, considerations which militate against giving r59(3) such a full operation. Mr Hanson through his counsel says that such information as workplace, gender and telephone numbers is confidential. It is information which would have its own market and which, in the hands of a disgruntled member after the election, may make its way to a competitor union, with the potential to do serious damage to the industrial interests of the AWU. The release of that information may intrude upon the privacy of members. Some members have silent telephone numbers, and may not wish to have that information made available to other members. The records are not available to members of the public. There are good reasons why they should remain confidential, both in the interests of the AWU or the Branch and in some cases (eg silent telephone numbers) of the members as individuals. Some information will have been provided to the AWU in confidence. It is easy to conceive of circumstances where the Branch Secretary has good reason to be concerned about the use to which information sought to be inspected may be put. An extreme example would be where a member seems to ascertain the private details of another member to pursue a personal vendetta.

[54]

[34] Gray J in Scott v Jess (1984) 3 FCR 263 at 282 - 284 discussed considerations relevant to implying terms into the rules of an organisation registered under the Act. His Honour said at 284 : "The difficulty of implying terms into the rules of an organisation does not, however, mean that such rules are to be construed as if no implication whatever arises from them. In many respects, there are to be derived from the express terms of the rules, the terms of the Act and the Regulations, and the nature, function and purpose of the organisation concerned, implications which limit what might otherwise be the extent of the express terms of the rules. ..." [35] His Honour at 286 - 288 referred to four useful principles in determining whether and to what extent the express powers contained in the Rules of a registered organisation are limited by implication. As his Honour acknowledged, those principles may not be equally applicable in all circumstances and indeed they may conflict in their application in certain circumstances. That statement of principles was approved by the majority of the Full Court ( Evatt and Northrop JJ) in Tanner v Maynes (1985) 7 FCR 432 at 441. The third of those principles is, to my mind, helpful in addressing the present issue. Gray J said at 287 : "3. A power given to a person or persons by the rules of an organisation must be exercised in good faith and for the purpose for which it is given, not for some ulterior or extraneous purpose. In support of this proposition, it is unnecessary to do more than to refer to the joint judgment of Evatt and Northrop JJ in Allen v Townsend (1977) 31 FLR 431 at 483-489, and to the cases cited in that passage, although the proposition at 483 that the fiduciary duty therein referred to is owed to the members of the organisation, as distinct from the organisation itself, may be questionable. In this respect, it is important to note that the onus of proving lack of good faith or ulterior purpose rests upon those who seek to overturn the exercise of a power, and not upon those who seek to uphold it. See Ascot Investments Pty Ltd v Harper (1981) 148 CLR 337, at 348-349 per Gibbs J (as he then was), with whom Stephen , Aickin and Wilson JJ concurred." [36] I consider that it is appropriate to imply into the right given to members under r59(3) some such restriction as there referred to. There are, of course, differences in the responsibility of, and the relationship with, an organisation on the part of those charged with its management from those who are simply its members. The special position of those charged with responsibility for the management of the affairs of an organisation is explained by Heerey J in McGee v Sanders (1991) 30 FCR 565 at 571 - 573. However, in my view, the nature, function and purpose of an organisation such as the AWU warrants the implication of a similar restriction upon the right of a member to inspect records of the AWU to that which applies to the members of the Branch Executive (or other officers) to exercise that right in good faith and for the purpose for which the right has been given and not for some ulterior or extraneous purpose. R4 sets out the objects of the AWU. It is clear that its principal objects include fostering and promoting the interests of its members eg r4(1), r4(3), r4(4), r4(11), r4(12), r4(15), r4(18), r4(21) and r4(23) - r4(30). R17 obliges a member to abide by the Rules. If a member were to seek to exercise the right to inspect a record of the AWU for an entirely extraneous purpose, such as identifying the personal details of a member to pursue a personal vendetta or for the purpose of assisting another organisation to recruit its members, I do not think that it is intended that the Rules are intended to facilitate that process. Consequently, I consider that it is implied into r59(3) that inspection is not permitted if it is proved that a member seeks to inspect part or parts of the records of the AWU for a purpose which is inconsistent with the interests of the members of the AWU. The onus of proving that wrongful purpose will lie upon the Branch Secretary or other officer responsible for providing inspection of records in response to a request: see McGee v Sanders (No 1) at 574; Gray J in Scott v Jess at 289. 33 It is accepted that the instrument with which Mansfield J was concerned was the registered rules of a union and not a statutory instrument. It is also accepted that preferred approach to the construction of union rules is to construe them not technically or narrowly, but broadly and liberally: see The Queen v Holmes and Others; Ex parte Public Service Association of New South Wales and Another (1977) 140 CLR 63, although such an approach would not seem to be inconsistent with a purposive approach to statutory construction.

[68]

(2) In any Act or Instrument, the word "shall", if used to impose a duty, indicates that the duty must be performed. 48 Section 9 of the Interpretation Act is not, however, decisive. Section 5(2) provides: This Act applies to an Act or instrument except in so far as the contrary intention appears in this Act or in the Act or instrument concerned. 49 As Pearce & Geddes observe at 339 in relation to such provisions as s 9: In many cases no reference is made to the provision, the courts discussing the issue only in common law terms. In other cases the courts have pointed to the fact that the Interpretation Acts are all expressed to apply unless the contrary intention appears which leads one back to the common law position. 50 The common law position is that there is a prima facie presumption that permissive or facultative expressions, such as the word "may" operate according to their ordinary natural meaning and that "it lies on those who assert that the word 'may' has a compulsory meaning to show, as a matter of construction of the Act, taken as a whole, that the word was intended to have such a meaning": Ward v Williams (1955) 92 CLR 496 at 506. 51 Importantly, I also note that the learned authors express the view that provisions which empower courts to grant relief of a specified kind are usually not treated as imposing an obligation to exercise that power (at 337). And further, that this appears to be the standard approach, fitting as it does with the general common law and equitable rules relating to the discretion the court exercises with regard to remedies (at 338). The authorities cited included Newmarch v Atkinson (1918) 25 CLR 381, Ward v Williams and Re Sarina; Ex parte Wollondilly Shire Council (1980) 32 ALR 596. 52 One of the exceptions referred to by Pearce & Geddes was Owens, which was relied upon by Mr Murray in the present proceedings. In Owens it was held that where it had been determined the applicants were entitled to be members of a union they had a right to appropriate orders to give effect to that determination.

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