FEDERAL COURT OF AUSTRALIA

Beswick, in the matter of an Election for an Office in the Shop, Distributive & Allied Employees’ Association v Swetman [2013] FCA 642

FEDERAL COURT OF AUSTRALIA

Beswick, in the matter of an Election for an Office in the Shop, Distributive & Allied Employees’ Association v Swetman [2013] FCA 642

CORRIGENDUM

1.    In paragraph 5 of the Orders of QUD 315 of 2013, the word “it” should read “is”.

2.    In paragraph 5 of the Orders of QUD 316 of 2013, the word “it” should read “is”.

Associate:

Dated:    3 July 2013

THE COURT ORDERS THAT:

1.    The acceptance by Mr Andrew Reid of the Australian Electoral Commission in his capacity as the Returning Officer of the nomination for election to the position of Secretary/Treasurer 2013 with the Queensland Branch of the Shop, Distributive & Allied Employees’ Association lodged by Mr Alan George Swetman is invalid.

2.    An irregularity has occurred in the election for the position of the Secretary/Treasurer 2013 of the Branch by the acceptance of the nomination.

3.    The Returning Officer make arrangements for the uncompleted steps in the election on the basis that there is only 1 valid nomination for that office, namely the nomination of Mr Christopher Ronald Ketter.

4.    Leave is granted for Shop, Distributive & Allied Employees’ Association to appear – so-named second respondent.

5.    Leave it granted for the Australian Electoral Commission to appear – so-named third respondent.

6.    The inquiry be terminated.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

THE COURT ORDERS THAT:

1.    The acceptance by Mr Andrew Reid of the Australian Electoral Commission in his capacity as the Returning Officer of the nomination for election to the position of Secretary/Treasurer 2013 with the Queensland Branch of the Shop, Distributive & Allied Employees’ Association lodged by Mr Alan George Swetman is invalid.

2.    An irregularity has occurred in the election for the position of the Secretary/Treasurer 2013 of the Branch by the acceptance of the nomination.

3.    The Returning Officer make arrangements for the uncompleted steps in the election on the basis that there is only 1 valid nomination for that office, namely the nomination of Mr Christopher Ronald Ketter.

4.    Leave is granted for Shop, Distributive & Allied Employees’ Association to appear – so-named second respondent.

5.    Leave it granted for the Australian Electoral Commission to appear – so-named third respondent.

6.    The inquiry be terminated.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

1    Ms Ellen Michele Beswick is a member of the Shop, Distributive & Allied Employees’ Association (SDA). She has been a member of the SDA for 36 years. The SDA is an industrial organisation of employees presently registered under, and governed by, the Fair Work (Registered Organisations) Act 2009 (Cth) (the Act). Ms Beswick has applied for an inquiry to be conducted by the court in respect of a forthcoming election within the Queensland Branch of the SDA. More particularly, her application is for an inquiry into the election for the office of Secretary/Treasurer within the Queensland Branch.

2    The election has yet to be conducted. Matters have reached the stage where nominations have been called and two nominees have been accepted by the Australian Electoral Commission for the election to that office. The two nominees are Mr Christopher Ronald Ketter and Mr Alan George Swetman.

3    There are critical timelines associated with the conduct of the election by the Australian Electoral Commission that lend a singular urgency to Ms Beswick’s application. They are that the latest date upon which the Commission is able to secure the printing of ballot papers for the election is 26 June 2013. Thereafter, the last day for the posting of ballots to members in respect of the election is 2 July 2013. The ballot will be open between 8 July and 26 July 2013.

4    Ms Beswick’s application is grounded upon the proposition that Mr Swetman is not eligible to be a candidate in the election for the position of Secretary/Treasurer because, however one reads the rules of the SDA and its Queensland Branch, he is not a member of the union. Her further contention is that, in order to be a candidate, one must be a member.

5    That the acceptance of a nomination which is not validly made under the rules of an industrial organisation may constitute an irregularity in the conduct of an election was accepted in respect of materially similar earlier federal industrial legislation in Re Election for Office in Transport Workers Union of Australia (West Australian Branch) (1992) 40 IR 245, and in Rivers, in the matter of an Application for an Inquiry relating to an Election for an Office in The Shop Distributive & Allied Employees’ Association, South Australian Branch [2004] FCA 711 (SDA South Australian Branch case). I am satisfied that the position under the Act, as it presently stands, is no different. When the case was called on today, Mr Murdoch QC, who appeared for Ms Beswick, invited me, in the first instance, to be satisfied in terms of s 201 of the Act that there were reasonable grounds for the application. In that regard, when the case was called on, Mr Swetman sought leave to appear, as did the Australian Electoral Commission. I granted each of them leave, initially for the purpose of hearing them as to whether or not I should be satisfied that there reasonable grounds for the application.

6    It became apparent to me from Mr Swetman’s submissions in particular, viewed in light of the basis of Ms Beswick’s application, that there was a real and genuine controversy as to whether or not a person in Mr Swetman’s position as an employed organiser (and it will be necessary later to say something of Mr Swetman’s employment history) was eligible to be a candidate for the office of Secretary/Treasurer of the SDA’s Queensland Branch. The Australian Electoral Commission’s stance, as one might expect, was that the Commission saw its role as nothing more and nothing less than conducting an election according to law, which materially included according to the rules of the industrial organisation concerned.

7    Also when the case was initially called on, Mr Murdoch QC informed me that there had been some contact with the solicitors instructing him by a Mr Macken of the Victorian firm AJ Macken & Co on behalf of the SDA itself (of which more shortly).

8    I formed the view that the case was one where there were reasonable grounds for the application, and that the circumstances of the imminence of a need to take an administrative step of the printing of ballots was such that the inquiry should commence instanta. Given the possibility of an interest on behalf of the SDA itself, I stood the matter down for a short time to enable that to be communicated to Mr Macken. I shall deal a little later in these reasons with what transpired to be the result of that communication. I then granted leave to Mr Swetman and to the Electoral Commission to appear on the inquiry, as well as, obviously, Ms Beswick. No other person at that stage sought leave to appear.

9    The facts of the case are not controversial. Indeed, it was a noteworthy feature of the case that the parties cooperated to a commendable extent in ensuring that particular facts were agreed.

10    The evidence before me, including the facts agreed, discloses the following.

11    Mr Swetman was employed first as an organiser by the Queensland Branch of the SDA in 1995. He had, before then, worked in the retail industry, but had not, before becoming an employed organiser, been a member of the SDA.

12    Upon becoming an employed organiser, Mr Swetman lodged with the Queensland Branch of the SDA an application for membership. Thereafter, and whilst an employed organiser, he paid from time to time the membership fees fixed in respect of union membership. Further, he received from time to time a membership card. An example of the type of card which he received, albeit one issued to another person, is an exhibit in the inquiry. The card does not discriminate as to any particular category of membership but rather specifies a particular member ID number with the designation “Member ID” as well as the name of the person concerned.

13    In May 2013, a controversy emerged in relation to Mr Swetman’s employment as an organiser. He had been continuously employed as an organiser by the SDA within its Queensland Branch from 1995 until May 2013. On 23 May 2013, a special meeting of the State Council of the SDA’s Queensland Branch was held. That council meeting resolved, unanimously, to terminate Mr Swetman’s employment and also, it must be said, his membership of the SDA. There was a prior show cause letter sent to Mr Swetman in which was specified the basis upon which it was alleged he might be terminated. It is no part of the inquiry proceeding to determine whether or not the termination was lawful. Whatever remedies there are in that regard remain open for Mr Swetman to pursue if so advised.

14    In her affidavit, Ms Beswick expressed the view that Mr Swetman was entitled to be treated as an honorary member whilst employed as an organiser. It may perhaps be that that perception informed the wording of the resolution passed by the State Council insofar as that resolution touched upon the subject of membership.

15    Mr Swetman received from the Australian Electoral Commission a letter dated 5 June 2013 under the hand of the Commission’s Mr Andrew Reid, who is the appointed returning officer for the election. In that letter, Mr Reid advised Mr Swetman that he had accepted nominations in the election in respect of Queensland Branch Secretary/Treasurer 2013 from those included in an attachment to that letter. The attachment discloses, that those accepted were the persons to whom I have earlier referred, ie, Mr Ketter and Mr Swetman. It further discloses that nominations in respect of the above election closed at 12 noon on 24 July 2013.

16    On the same day as Mr Reid authored his letter of advice to Mr Swetman, he sent an email to a Mr Chris Gazenbeek of the union. That communication conveyed the same advice as to the nominations which Mr Reid had accepted and also requested Mr Gazenbeek to provide a list of members of the SDA. The purpose of the latter request, obviously enough, was for the purpose of the conduct of the ballot. That particular communication came to Ms Beswick’s attention and the application for the inquiry was the result.

17    The SDA’s national rules make provision, by clause 3, for the persons who may constitute, ie, be members of, the union. Three broad categories of membership are specified in clause 3, parts 1, 2, and 3 respectively. Part 1 is cast in a form which is not unusual in the rules of industrial organisations in terms of its breadth. One there finds that, materially:

The Association shall consist of an unlimited number of members engaged in any capacity in or in connection with selling, receiving, handling, demonstrating, and/or delivery of goods in or for any shop or warehouse, including retail, grocers’ carters; also employees in any dispensary and/or employees engaged in the reception, sale, demonstration or delivery of good’s …

18    Part 2 is not material. Part 3 provides:

The Association shall also consist of such other persons as have been appointed officers of the Association and admitted as members thereof and such persons who have been appointed life members. Any member leaving the industry to work in another shall cease to be a member of the Association but may if he or she so desires remain an honorary member and shall not be eligible to hold office. Life members may be exempt from paying contributions and levies.

19    Rule 37(a) of the SDA’s rules is directed to the subject of the powers and duties of branches. It provides, materially, that:

Each Branch of the Association shall have full autonomy and representation and control of the industrial interests of members of the Association in their respective States or Areas, and all matters affecting the members of the Branch only.

20    Rule 37(b) provides:

Each Branch shall have power to elect its own officers.

21    Rule 37(c) permits the branch of the association to make, alter, amend, and rescind rules for the proper conduct of the branch, providing the same are not in conflict with the association’s rules.

22    The Queensland Branch has made rules as contemplated by rule 37 of the SDA rules. These provide that, as to constitution, the branch shall, in respect of a particular part of the State of Queensland, have the same constitutional coverage as set out in the constitution rule of the association as amended from time to time (rule 3, Queensland Branch Rules).

23    The Queensland Branch Rules further provide, by rule 6, for a State Council. Rule 7 of the Queensland Branch Rules specifies the constitution and powers of the State Council. It is there provided that the State Council consists of the President, two Vice-Presidents, the Secretary/Treasurer, the First Assistant Secretary, and District Representatives from areas more particularly specified in rule 7(a). Rule 8 provides for a committee of management of the branch with rule 9 specifying who comprises the committee of management. The committee of management consists of the president, two vice-presidents, the secretary/treasurer, first assistant secretary, and five district representatives from the greater Brisbane area on the State Council. There is a proviso in respect of the composition of the committee of management. That proviso mentions organisers, but it is plain from the context that the organisers referred to in this rule in respect of the committee of management are persons elected as organisers. Put another way, an employed organiser does not fall within the terms of the proviso in clause 9(a).

24    The duties of the offices of president, vice-president, secretary/treasurer, and first assistant secretary, are as respectively specified in rules 11, 12, 13, and 13A.

25    Rule 14 of the Queensland Branch Rules is directed to the subject of organisers. It provides, amongst other things, by clause (a) that:

Organisers shall attend all meetings of the branch whilst in Brisbane; they shall receive moneys due to the branch, issue receipts for payment, and hand all moneys they receive to the secretary treasurer within one week of receiving such moneys.

Other provisions in rule 14 worthy of note in respect of organisers are clause (d):

Should they desire to terminate their engagement they shall give one month’s notice in writing to the State Council.

And clause (f):

State Council may employ such number of organisers as State Council may see fit.

26    Rule 22 provides for the completion by new members of an application for membership in an application form supplied by the branch. Rule 23 provides that:

State Council may, from time to time, fix and vary membership fees payable by members, which shall be payable quarterly in advance.

And, by clause (b):

State Council may from time to time, fix an entrance fee to be paid by applicants for membership of the branch, but any fees so fixed shall not exceed fifty cents (50c); provided always that any fee so fixed may be waived where an applicant produces a current clearance form from any other registered Trade Union or organisation of employees.

27    It is common ground that one of Mr Swetman’s duties while he was employed as an organiser was the recruitment of new members. That this was one of his duties is exactly in accordance with the expectation one might have flowing from the provision of the Queensland Branch Rules with respect to organisers.

28    It is further common ground that Mr Swetman did attend members’ meetings of the SDA without challenge and further that he may well, at such meetings, have signed a members’ attendance register, again without challenge. It is likewise agreed that Mr Swetman did, upon being employed by the SDA in its Queensland Branch as an organiser, submit an application form of the kind referred to in the Queensland Branch Rules.

29    It is further agreed, as I have indicated earlier, that he paid from time to time membership fees as fixed under the SDA’s Queensland Branch Rules.

30    The submission made on behalf of Ms Beswick was that Mr Swetman was not eligible to be nominated as a candidate, or to be accepted as a nominee, because he was not eligible to be a member of the union. I can well understand why it was that Mr Swetman at least thought, in good faith, that he was eligible to stand for election and to be nominated as a candidate for the position of Secretary/Treasurer.

31    Why that is so should be apparent enough from these facts. He submitted an application form. It was not rejected. He paid his dues year after year without question and he received a membership identity card. He also attended members’ meetings without challenge and, very likely, although it is not the subject of express agreement, voted, again without challenge.

32    All of that reasonably in the mind of a layman would suggest union membership. It is, though, necessary to recall that the existence of any practice whereby persons who were not eligible to be members were nonetheless treated as such does not confer membership. So much in my view flows from the proposition that, in considering the true construction of the rules of an industrial organisation, the principle of acquiescence does not govern matters: see Re an Application by John Rajan Thomas for an inquiry into an Election in the South Australian Branch of the Australian Workers Union (unreported, Keely ACJ, 21 July 1992) (Re Application by John Rajan Thomas) and the reference in that case by his Honour to Re Demas v Pearson (1951) 73 CAR 3. Another perhaps more pithy way of putting that same point is that a stream cannot rise higher than its source. If it were to transpire that Mr Swetman was not eligible to be a member of the union, no amount of the external trappings of membership could alter that position.

33    Is he then eligible to be a member of the union?

34    The submission that was made on behalf of Ms Beswick was that Mr Swetman did not fall within part 1 of rule 3 of the Rules because it could not be said that he was either employed in any of the callings concerned or, as the term is understood, employed in connection with any of the callings. As to that, reliance was placed upon an earlier judgment of the Commonwealth Industrial Court, Rounsevell v Mitchell (1968) 11 FLR 414 at 429 (Rounsevell v Mitchell), the following was stated:

It was argued for the respondents that although Barry was not employed or engaged in the above-mentioned industries or callings at the time he applied for membership he was engaged “in connection with” those industries or callings and rule 6 permits a person in this position to become a member. The argument was that Barry was employed to handle, as an industrial officer, industrial matters arising in relation to the members of the union in the industries or callings set out in r 6 and because his employment was of this nature, he could be said to be employed in connection with those industries and callings.

In the case of Re Election for Office in Professional Radio Employees Institute of Australasia, Joske J held that a secretary employed by that institute who did not have an occupation as set out in the constitution rule of the institute could validly be admitted to membership by that institute and hence be elected to office. The rules of the institute are different in some respects from the rules of the organisation under consideration in this case. One part of the reasoning of Joske J is, however, relied upon by the respondents. He was considering the meaning of the phrase “a person employed in connextion with an industry or engaged in an industrial pursuit” in s 144 of the Act, and he came to the conclusion that a person such as the secretary under consideration in the case before him was a person employed in connextion with an industry.

35    And then a little later on page 430:

Expressed in its simplest form, the argument relied upon is that a person employed on the staff of an organisation as an employee handling industrial matters arising in respect of the employment of union members in their various industries or callings is employed by the union in connection with those industries or callings. We are unable to agree with this argument. He is employed in another industry or calling completely different from the industries or callings in r 6. There is no connextion between his employment and those industries or callings.

He does no work connected with the actual work of those engaged in those industries or callings. His work is to endeavour to obtain for them wages and conditions of employment which they seek or the organisation seeks on their behalf. Work of this kind is not work connected with the industries or callings themselves. It is not work connected with what such employees do in the industries or callings, but is work connected with the reward they get for what they do or with the relations between their employer and themselves.

36    That case was cited with approval by Mansfield J in the SDA South Australian Branch case at para 20, along with other authorities to similar effect.

37    Though Rounsevell v Mitchell was decided by a bench comprised of three judges, it was nonetheless an exercise of original jurisdiction, reflecting the practice at the time as to the way that jurisdiction was exercised by the then Commonwealth Industrial Court. Nonetheless, I would only depart from a considered decision such as that given in Rounsevell v Mitchell if I was persuaded that it was clearly wrong. Especially, that is so, given that it has been acted upon in this court by Mansfield J in the case mentioned. I am not persuaded that Rounsevell v Mitchell is clearly wrong, but rather to the contrary. With respect, it strikes me that it is clearly right, and aptly cited in the present case. The long and the short of it then is that, as an employed organiser, Mr Swetman was not, in terms of part 1 of rule 3 of the SDA Rules, entitled to be a member. He did put to me that one of the tasks which he undertook as an organiser, and that which I have mentioned earlier, was the “selling” of membership tickets. That is not the type of sales activity to which part 1 of clause 3 is directed. Indeed, to refer to it as “selling” at all is to adopt a very particular form of Australian idiom. The more correct description of the task undertaken is recruitment of new members. Further, and without in any way detracting from the point that the task is not that of selling, it is not a sale of goods. It is a sale of membership or, as I have said, the offering of the advantages of union membership to particular persons in the hope and expectation of recruiting those persons who are eligible to be members of the union.

38    That then leaves for consideration whether or not Mr Swetman falls within the terms of part 3 of rule 3 of the SDA rules. As to that my view is that, he does not and did not hold an office of the kind contemplated. He was not the holder of an elected office. Part 3 refers to those who hold such an office. It also refers to the life members and to honorary members. Mr Swetman is not a life member. At most, he may be an honorary member, but the rule in rule 3 part 3 is clear. An honorary member shall not be eligible to hold office.

39    The proceeding today was necessarily adjourned for continuation after lunch. After the luncheon adjournment, and before submissions were concluded, it came to my attention that Mr Macken had made contact with the registry. I stood the case down again for short time, on this occasion to enable telephone communication to be made of Mr Macken. Upon resuming, Mr Macken announced that he had instructions from the SDA – in other words, the federal industrial organisation. I relayed to him the course of proceedings to date, that an inquiry was being conducted and the nature of the submission made on behalf of Ms Beswick. I also drew to Mr Macken’s attention the particular observations which had been made by Finkelstein J in Re Inquiry relating to Election for offices in United Firefighters’ Union of Australia, Victorian Branch; Re Churchill (2000) 102 IR 247, concerning whether industrial organisations would or would not usually be granted leave to appear. One of the situations envisaged by Finkelstein J as to when an industrial organisation might be granted to appear was where the proper construction of the rules in the organisation might come up for consideration during an inquiry. His Honour replied at p 248, and I respectfully agree, that:

In such a case, the organisation would usually be entitled to be heard because all members may be affected by the result, and the organisation can speak on their behalf.

40    Mr Macken sought to appear on behalf of the SDA. In so doing, he expressly indicated that the SDA’s position was to adopt the submissions made on behalf of Ms Beswick, ie, that an employed organiser was not, without more, eligible to be a member of the union. I granted Mr Macken leave to appear on behalf of the SDA. That having occurred, and Mr Macken having confirmed that he wished to make no further submission other than that of adopting the position mentioned, I then granted, at Mr Macken’s request, leave for him to withdraw from the hearing.

41    The conclusion which I have reached, therefore, is that Mr Swetman was not, and indeed never was, eligible to be a member of the union of the SDA, except perhaps in an honorary capacity.

42    It is not necessary for the purposes of the inquiry to delve into whether it was even possible under the SDA’s rules for Mr Swetman to be an honorary member. That is because, even if he had that status, it is not possible for him to stand for election for an office within the union.

43    That result is one which is a necessary consequence of the true construction of the rules of the SDA’s Queensland Branch and the SDA itself. The result is consistent with the view taken of the operation of the SDA’s South Australian Branch Rules by Mansfield J in the SDA South Australian Branch case.

44    It is necessary to recall that there is a distinction between the position of employed organiser and rules which provide for persons to be elected to the office of organiser. Election to the office of organiser does not make one an employee of the union concerned: see Roughan v Coulson (1992) 3 IR 393. It may be possible, depending on the rules of the organisation concerned, for someone who is an elected officer also to have employment by the union. It is not necessary for the purpose of deciding this case to delve into that question. That is because Mr Swetman did not ever contemporaneously hold an elected office within the union. He was, at all material times, an employed organiser. Further, he does not fall within that category of person who, having once been employed within a calling, ceases to be in that calling upon taking up an elected office within the union. Such persons may continue to be members of the union.

45    The end result, then, is that a nomination has been received and accepted by the returning officer from a person who is not eligible under the rules of the Queensland Branch and the SDA to stand for elected office. That being so, the case is not one for interim, but rather final, relief.

46    As to the form of relief which should be granted, the SDA South Australian Branch case offers assistance. The orders made in that case were that the acceptance by the returning officer of the nomination for election of the office of a particular specified office by the particular nominee was invalid. A declaration was also made that an irregularity had occurred in the election by the acceptance of the nomination. A direction was further made that the returning officer make arrangements for uncompleted steps in the election to be completed on the basis of the valid nominations received by a particular date. His Honour otherwise ordered that the inquiry be terminated. His Honour cited as authority for the making of orders in such terms Re Mellor, Re Federated Liquor & Allied Industries Employees Union of Australia (1986) 17 IR 402, and Re Application by John Rajan Thomas, already cited by me earlier. Each of those cases, together with the SDA South Australian Branch case, persuades me that it is appropriate to make orders of a like kind in this case.

Associate:

Dated:    1 July 2013