FEDERAL COURT OF AUSTRALIA

Conway v Fernandez [2018] FCA 1949

ORDERS

THE COURT ORDERS THAT:

1.    Upon the applicant giving the usual undertaking as to damages, and pursuant to s164(4) of the Fair Work (Registered Organisations) Act 2009 (Cth), until the hearing and determination of this proceeding or further order, the respondents be enjoined from proceeding to hear and determine the charges contained in the summons sent to the applicant on 20 November 2018.

2.    There be liberty to any party to apply on 3 days’ notice to have the proceeding listed for an interlocutory hearing.

3.    The proceeding be listed for case management on 18 December 2018 at 10.15 am.

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

REASONS FOR JUDGMENT

(Revised from transcript)

WHEELAHAN J:

Introduction

1    The applicant is the President of the Federal Council of the Australasian Meat Industry Employees Union. The first respondent is the Secretary of the New South Wales Branch of the Union, and is also a member of the Federal Council. The other respondents are also alleged to be members of the Federal Council of the Union.

2    The evidence discloses that the Federal Council of the Union proposes to meet on 4 and 5 December 2018 to consider charges which are said to be brought under the rules of the Union. The particular rule of the Union which has been invoked against the applicant, on its face, authorises expulsion or alternatively suspension from membership of the Union as a permissible sanction.

3    The applicant brings this proceeding seeking interim and final relief under s 164 of the Fair Work (Registered Organisations) Act 2009 (Cth) (RO Act). Before me is an urgent application which, as originally framed, sought orders (inter alia) that the respondents perform and observe the Rules of the Union by treating as null and void the calling of a special meeting of the Federal Council of the Union on 4 and 5 December 2018.

4    The evidence before me supports the conclusion that late on Friday 30 November 2018 each of the named respondents was sent by email a copy of the originating process and an affidavit of the applicant affirmed 30 November 2018, and was given notice that there would be an interlocutory hearing on 3 December 2018 at 2.15 pm. Of the named respondents, the first respondent appeared on the application for interim relief. There was no appearance for any other respondent.

5    On the hearing of the application, the applicant relied additionally upon two affidavits of the applicant’s solicitor affirmed 3 December 2018. The first respondent tendered, and I received into evidence, an email dated 20 November 2018 together with attachments from Kristen Rogers, the National Industrial Officer of the Union, to the applicant, the first respondent, and a number of others.

background

6    The applicant stated that he has been a full-time official of the Union for a period of 21 years. He is currently Secretary-Treasurer of the Victorian Branch, and became Federal President of the Union in September 2018.

7    The Union is an organisation of employees which is registered pursuant to the RO Act, and it is governed by the Rules of the Australasian Meat Industry Employees Union (Rules).

8    On 27 September 2018, Jason Schultz, an Industrial Officer of the New South Wales Branch of the Union, wrote an email to the second respondent, Graham Smith, as Federal Secretary of the Union, seeking to charge the applicant and Mr Smith under rule 35 of the Rules. The email stated that it was “[f]iled on behalf of State Secretary Patricia Fernandez”, who is the first respondent. The email requested that an extraordinary Federal Council be convened as a matter of urgency to consider the charges. A table was attached to the email which identified six charges which alleged (inter alia) that the applicant had used abusive language at a Federal Council dinner on 13 September 2018, and on another occasion at a Federal Executive Meeting on 8 March 2018.

9    On 20 November 2018, the National Industrial Officer of the Union sent to the applicant by email a document described as a “Summons” stating that he was summoned to attend a meeting of the Federal Council of the Union to respond to charges made by the first respondent. Some details of the charges were set out in the document. The document stated that the applicant was summoned to show cause. The document stated that it was anticipated that the meeting would take place on Wednesday 5 December 2018.

10    On 20 November 2018, the National Industrial Officer also sent the email that I received into evidence, that was sent to the applicant, the first and second respondents, and others. The email had a number of attachments, including a memorandum to the Federal Executive concerning Federal Council procedures, noting that the progress of the matter was ultimately for the Federal Executive and the Federal Council to decide. The memorandum had attached to it a table in the form of a checklist of issues relating to process and procedure.

11    On 23 November 2018, the applicant wrote to the first respondent proposing a mediation of the matters in dispute. This proposal was rejected by email from Jason Schultz of the New South Wales Branch dated 26 November 2018.

12    By letter dated 27 November 2018 from the applicant to the second respondent as Federal Secretary, the applicant sought information in relation to the process and procedures for the hearing. The applicant also requested, in relation to each of the six charges, further information and particulars.

13    By letter dated 29 November 2018, the second respondent advised the applicant (inter alia) that a day for dealing with process has been determined to be held on 4 December 2018, and that it was envisaged that all the matters on which the applicant sought clarity would be raised and discussed on that day. The letter stated that the question of further and better particulars would be better raised with the complainant.

14    On 30 November 2018, the lawyers acting for the applicant sent a detailed letter to the second respondent as Federal Secretary of the Union alleging that the applicant was being denied natural justice in three respects –

(a)    a failure to provide particulars, and information about the process and procedure;

(b)    that witnesses to the events of 13 September 2018 would be hearing and determining the charges; and

(c)    in circumstances where there was a factional divide, those in a faction opposed to the applicant would be unable to consider impartially the charges against the applicant.

15    The letter also alleged that the charges were flawed in that the first respondent was seeking to expel the applicant from each of the offices which he holds, and to that extent, the charges were incompetent.

16    In response, the National Industrial Officer wrote to the applicant’s lawyers later on 30 November 2018 and stated (inter alia) that 4 December 2018 had been allocated by the Federal Council to determine process, at which point, the matters raised by the correspondence would be dealt with. The letter denied that the applicant had been, or would be, denied procedural fairness.

17    On 3 December 2018 the lawyers for the first respondent wrote to the lawyers for the applicant in relation to further particulars of the charges. The letter stated that the charges were clear, and did not require any further particulars. The letter also stated that the question as to which witnesses would give evidence, and the manner in which they would give evidence, would be a matter for the Federal Council. Nonetheless, the letter provided some further particulars of the charges.

18    In relation to the question whether the Special Meeting of the Federal Council had been requisitioned, there was in evidence an email from the Secretary of the South and Western Australian Branch of the Union dated 9 November 2018 which appears to request under rule 13.7 of the Rules a special meeting of the Federal Council to deal with the charges. There was also in evidence an email dated 12 October 2018 from the Secretary of the Queensland Branch of the Union stating that the Queensland Branch advised pursuant to rule 13.7 that it required a special meeting of the Federal Council to deal with the charges brought by the first respondent. There is also an email dated 12 October 2018 from Jason Schultz, the Industrial Officer of the New South Wales Branch of the Union invoking rule 13.7 and stating that the New South Wales Branch called for a meeting to be held urgently, for the purpose of hearing and determining charges against the applicant.

19    Late afternoon on 30 November 2018 the applicant’s lawyers sent emails to representatives of each of the South and Western Australia, New South Wales, and Queensland branches requesting evidence that a resolution was passed by those branches requisitioning a special meeting of the Federal Council pursuant to rule 13.7. By email dated Sunday 2 December 2018 the Secretary of the South and Western Australian Branch supplied copy minutes of an executive meeting of 19 October 2018 which record that the meeting resolved to call a special Federal Council meeting in accordance with rule 13.7 to deal with charges brought by an official of the New South Wales branch.

The rules

20    Relevant rules of the Union are as follows –

13.3    Federal Council shall meet in September, at intervals of two years. Meetings, shall be held in any area in Australia as decided by Federal Council or Federal Executive.

…

13.7    When requisitioned by at least three Branches of the Union, special meetings of the Federal Council shall be called by the Federal Executive at a time and place to be decided by the Federal Executive.

…

15.2    The Federal Council may also remove from office any Federal Council Officer or Federal Council Delegate, any Branch Officer and any member of a Branch Committee of Management where the person concerned has been found guilty by the Federal Council of any one or more of the following charges:-

15.2.1    misappropriation of the funds of the Union;

15.2.2    a substantial breach of these rules;

15.2.3    gross misbehaviour;

15.2.4    gross neglect of duty;

15.2.5    the person concerned has ceased to be eligible to hold office according to these rules.

15.3    A person charged pursuant to sub-rule 15.2 shall be summoned in writing to show cause before a meeting of the Federal Council why the member should not be so removed.

15.4    A person summoned to show cause pursuant to sub-rules 15.2 and 15.3 of this rule shall be given at least 14 days' notice of the time and place of the meeting of the Federal Council to which the member is summoned and the notice summoning such person shall also specify the charge or charges upon which it is proposed to consider such removal.

15.5    The Federal Council may proceed to hear and determine a matter under this rule despite the absence of the person summoned if due notice of the hearing has been given in accordance with this rule.

15.6    When any Federal Officer is removed from office pursuant to this rule the vacancy shall be filled.

15.7    Where a delegate to the Federal Council is removed pursuant to this rule an election shall be held by the Branch concerned under rule 51 of these rules for the purpose of filling the vacancy and the person so elected shall hold office for the remainder of the term for which the predecessor was elected.

…

35.1    A member may be :-

(i)    Expelled; or

(ii)    suspended from the privileges of membership for a period not exceeding 12 months;

by the Federal Council or a Branch Committee of Management if the member:-

…

35.1.11    Uses any abusive or insulting language or who offers or threatens physical violence to any official, delegate, employee, or member of the Union;

…

35.2    A member charged under this rule shall be given every opportunity to defend the charge and may, if the member wishes, tender written submissions.

35.3    A member summoned to show cause pursuant to this rule shall be given fourteen days' notice of the time and place of the meeting of Federal Council or the Branch Committee of Management to which the member is summoned. The notice summoning him shall also specify the grounds of complaint.

35.4    The Federal Council or Branch Committee of Management may proceed to hear and determine the charge despite the absence of the person summoned if due notice of hearing has been given in accordance with this sub-rule.

…

35.8    When any member is charged with an offence under this rule by any official holding a seat on any governing body of the Union, such official shall not sit in judgement or exercise any vote when such charge is being decided by any governing body of the Union.

35.9    The Federal Council and/or each Branch Committee of Management or Branch Executive shall have the power, in addition to and without limiting the effect of any power otherwise by these rules created, to impose a fine not exceeding one thousand dollars ($1,000) for each offence on any member of the Union who -

35.9.1    Is guilty of any of the acts or omissions set out in sub-rules 35.1.1 - 35.1.18;

…

47.1    Each Branch shall have a President, Vice-President, Secretary and Treasurer.

47.2    Each Branch shall be governed by a Branch Committee of Management of such officers and such number of the committee members as hereinafter set out, elected by the Branch.

47.3    Each Branch may have as additional officers, an organiser or organisers and assistant secretary who, when elected, shall be members of the Branch Committee of Management.

…

48.    Qualifications for Office

Except in the case of officers elected in the first twelve months of the formation of the Branch, no person shall be eligible to be elected to office unless they have been a member of the Union for at least 12 months immediately preceding the member's nomination for election, and is a financial member of the Branch of which the person intends to seek office at the time of nomination. A retiring officer shall be eligible for re-election.

…

49.1    The functions of all Branch Committees of Management and Executives shall be to administer the rules for the benefit of the members, to carry out the policy of the Union to deal with all matters and transact such business as may arise, and endeavour to carry out the objects of the Union.

49.2    They shall decide in all cases for which no provision is made in these rules. The Branch Committee of Management or Branch Executive shall meet as and when required.

…

54.1    The Branch Committee of Management may remove from office any Branch Officer, Branch Delegate to the Federal Council, Branch member of the Federal Executive, member of the Branch Committee of Management of the Branch on the grounds that the person concerned is found guilty of:-

54.1.1    misappropriation of the funds of the Union; or

54.1.2    a substantial breach of these rules; or

54.1.3    gross misbehaviour or gross neglect of duty; or

54.1.4    in the case of a member of a Branch Committee of Management, the officer has failed without reasonable excuse to attend three consecutive meetings of the Branch Committee of Management that they are a member of; or

54.1.5    the person has ceased, according to these rules to be eligible to hold office.

54.2    A person charged pursuant to this rule shall be summoned to a meeting of the Branch Committee of Management in writing signed by the Branch Secretary to show cause why the person should not be so removed.

The LEGISLATION

21    Section 164 of the RO Act provides –

Directions for performance of rules

Application for order directing performance of rules

(1)    A member of an organisation may apply to the Federal Court for an order under this section in relation to the organisation.

Note:    For the meaning of order under this section, see subsection (9).

(2)    Before making an order under this section, the Court must give any person against whom the order is sought an opportunity of being heard.

(3)    The Court may refuse to deal with an application for an order under this section unless it is satisfied that the applicant has taken all reasonable steps to try to have the matter that is the subject of the application resolved within the organisation.

Court may make interim orders

(4)    At any time after the making of an application for an order under this section, the Court may make any interim orders that it considers appropriate and, in particular, orders intended to further the resolution within the organisation concerned of the matter that is the subject of the application.

(5)    An order under subsection (4) continues in force, unless expressed to operate for a shorter period or sooner discharged, until the completion of the proceeding concerned.

Definition

(9)    In this section:

Order under this section means an order giving directions for the performance or observance of any of the rules of an organisation by any person who is under an obligation to perform or observe those rules.

22    The source of the applicant’s claim for relief was confined to the Court’s power under s 164(4) of the RO Act. In Conquo v Jackson [2009] FCA 45 at [14]-[16] Sundberg J stated –

14.    The powers given by s164 and its precursors are wide, and enable the Court to go beyond the precise form of the rules and give directions calculated to ensure they are carried out. In R v Joske; Ex parte Shop Distributive and Allied Employees Association (1976) 135 CLR 194 at 212 Mason and Murphy JJ said:

The judgments of this Court in R v Commonwealth Court of Conciliation and Arbitration; Ex parte Barrett make it perfectly clear that sub-s(1) of s141 is not confined to the making of orders directing the performance or observance of a particular rule or particular rules of the organization, as the prosecutors would have it, and that it extends, as its words explicitly state, to the giving of directions for the performance or observance of any of the rules of an organization, that is, for the doing of acts which will conduce to the performance or observance of such rules.

Their Honours went on to say that the power to make interim orders is not limited to the giving of directions to perform or observe rules. See also Magner v Fowler (1979) 26 ALR 671 at 700-703.

15.    In McGee v Sanders (No 2) (1991) 32 FCR 397 at 402-403 Gray J expressed the view that applications for interim relief under s 164(4) are not necessarily to be approached in the same way as applications for interlocutory injunctions: serious issue to be tried, and balance of convenience. His Honour noted that the power to make interim orders is given in broad terms. The word “injunction” is not used, and it is rare for an applicant for an interim order under s 164(4) to be required to give an undertaking as to damages. His Honour thought that under s164(4) the Court’s duty was “to do justice as best it can”.

23    As Sundberg J noted in the passage set out above, in McGhee v Sanders (No 2) (1991) 32 FCR 397 Gray J stated that applications for interim relief are not necessarily to be approached in the same way as interlocutory injunctions. That may well be the case when interlocutory directions are sought, as may be contemplated by s 164(9). In this case, after I expressed concerns that the orders sought by the applicant were framed in mandatory terms that suggested that the Court had reached a final view about the matters in issue, the applicant amended the interim orders sought, so that paragraph 1 of the orders sought was as follows –

Pursuant to s 164(4) of the Fair Work (Registered Organisations) Act 2009 (Cth) an interim order that until the hearing and determination of the application or further order the respondents be enjoined from proceeding to hear and determine the charges contained in the Summons sent to the applicant on 20 November 2018.

24    The applicant addressed submissions before me by reference to the principles that ordinarily guide the grant of interlocutory injunctions, namely whether there was a serious question to be tried, and where the balance of convenience lay, and I shall consider the application for interim relief on that basis.

The applicant’s submissions

25    The applicant submitted that there were five grounds supporting his application for interim relief –

(a)    that he has been denied procedural fairness;

(b)    that r 35.1 is ineffective to the extent that it is being invoked to remove the applicant from his office, when there are other rules, specifically r 15.2 to 15.7 and rules 54.1 to 54.2, concerned with removal from office;

(c)    that members of the Federal Council who witnessed the alleged events that are the subject of the charges will be unable to consider the matter impartially;

(d)    that the applicant has not been given 14 days’ notice as required by rules 35.3 and 35.11; and

(e)    that the meeting of the Federal Council has not been requisitioned in accordance with rule 13.7, in that there is evidence of a resolution of only one branch, namely the South and Western Australian Branch, requisitioning the special meeting.

the first respondent’s submissions

26    The first respondent submitted first, that I should require the applicant to give an undertaking as to damages as a condition of interim relief. The first respondent also submitted that –

(a)    the application was premature, because the Federal Council was due to meet on 4 December 2018 to consider issues of process and procedure, and that the 20 November 2018 email was evidence that some thought and preparation had been given to those issues ahead of the Federal Council meeting;

(b)    the applicant had not taken reasonable steps for the purposes of s 164(3) of the RO Act to resolve the matter within the organisation;

(c)    there was nothing in rule 35.1 which excluded a charge being brought under that rule against a federal councillor;

(d)    by reference to what was said by Dixon J in Australian Workers Union v Bowen (No 2) (1948) 77 CLR 601 at 631, members of the Federal Council were entitled to act on their own knowledge of the alleged events;

(e)    14 days’ notice of the meeting had been given, because the meeting to consider the charges remained scheduled for 5 December 2018; and

(f)    I had not been referred to any rule that provides that branches must requisition a special meeting of the Federal Council by a resolution of the Branch Committee of Management.

Consideration

Denial of procedural fairness

27    I accept that the applicant has an arguable case that he has been denied procedural fairness. It is fairly arguable that under the Rules it is only the Federal Council itself that has authority to summon the applicant to show cause, to determine what particulars of the charge are necessary, and to determine its procedures. On the evidence, at least some of this appears uncontroversial, and the evidence is that the Federal Council proposes to meet on 4 December 2018 for the purpose of determining matters of procedure.

28    In my view, given the gravity of the remedy foreshadowed to the applicant, namely expulsion of the applicant from membership of the Union, it is arguable that procedural fairness requires that the applicant be given fair notice of the particulars of the charges that he faces, and the procedures to be adopted by the Federal Council, and that such information be given to him with the authority of the Federal Council. In my view it is arguable that notice of 24 hours or less does not give the applicant a fair opportunity to consider this information before the meeting proposed on 5 December 2018 to which the applicant has ostensibly been summoned to show cause.

Can rule 35.1 be invoked to remove the applicant from office?

29    I am not persuaded, on the argument advanced thus far, that the applicant has a strong case that rule 35.1 cannot be invoked to expel him from membership with the potential consequence that he is also thereby unable to hold office. The problem confronting such an argument is that the text of rule 35.1 appears to permit such a course, and does not draw any distinction between ordinary members, and officer holders. Whether an officer holder who has been expelled as a member may continue to hold office having regard to the terms of rule 48 set out above is not an issue that directly arises, and I express no opinion about it. As the matter has not been argued fully, I say no more about the applicant’s second ground other than to say that, at present, I am not persuaded that the argument is strong.

Members of Federal Council who witnessed the alleged events

30    In Australian Workers Union v Bowen (No 2) (1948) 77 CLR 601 at 630-631 Dixon J stated –

The last matter relied upon as invalidating the decisions is of a more serious kind. It is that the Executive and Dougherty were both prosecutors and judges and animated by such intensity of feeling that they were disqualified by bias. So far as this contention is based upon the fact that the Executive Council promoted the charges and that they were vitally concerned in the controversy not only as members of the union but as office-bearers whose authority had been resisted, there is in my opinion no substance in it. The reason lies in the constitution of the union. In choosing as a domestic forum a governing body and in authorizing it to make inquiries and investigations of such a kind the rules necessarily bring about, if they do not actually contemplate, such a situation. Domestic tribunals are often constituted of persons who may, or even must, have taken some part in the matters concerning which they are called upon to exercise their quasi-judicial function. Nor do I think that it has been shown that any particular member, putting aside the general secretary, was disqualified by any interest or specific ground of bias attaching to him or to them all.

31    In the case of the first respondent, she would prima facie appear to be disabled by rule 35.8 from exercising any vote on the charges brought against the applicant. As for the other members of the Federal Council, I am not persuaded on the evidence and argument presented to date that the applicant has a strong case that they cannot participate and vote at the proposed meeting. In the absence of full argument, I shall say nothing more about this ground for the time being.

Was 14 days’ notice given?

32    The applicant alleged that less than 14 days’ notice was given for a meeting of the Federal Council due to commence on 4 December 2018. However, the evidence favours the view that the meeting on 4 December has been proposed to discuss process and procedural issues, and that the meeting ostensibly to consider the charges remains scheduled for 5 December 2018. In relation to the 5 December meeting, it would appear, at least on a prima facie basis, that 14 days’ notice was given.

Has the meeting of the Federal Council been requisitioned in accordance with rule 13.7?

33    I consider that the applicant has a reasonable prima facie argument that a meeting of a Federal Council to consider the exercise of disciplinary powers under rule 35.1 must be requisitioned pursuant to rule 13.7. In this case, there is evidence that officials of three branches have requisitioned the special meeting. The issue raised by the applicant is whether the branches themselves have resolved to requisition the special meeting. Rule 47.2 of the Rules provides that each branch shall be governed by a Branch Committee of Management. Rules 49.1 and 49.2, set out above, provide for the functions of the Branch Committee of Management.

34    I consider that it is arguable on a prima facie basis, and without hearing full argument, that in the context of the Rules, a decision by a branch to requisition a special meeting of the Federal Council must be made by resolution of the Branch Committee of Management. The evidence suggests that the South and Western Australian Branch has so resolved. However, there is no specific evidence that the New South Wales Branch, or the Queensland Branch has so resolved. The lawyers for the applicant wrote to the lawyers for the first respondent by email dated 30 November 2018 requesting evidence that a resolution was passed by the New South Wales Executive requisitioning a meeting of the Federal Council pursuant to rule 13.7. The first respondent is the Secretary of the New South Wales Branch, and was represented before me at the hearing. The first respondent has not produced any direct evidence that the New South Wales branch resolved to requisition the special meeting. In the circumstances, and in the absence of full argument, I consider that the applicant has a prima facie case that the special meeting has not been requisitioned by at least three branches in accordance with rule 13.7.

Conclusion

35    I consider that within the context of what has occurred, and having regard to the issues that the applicant has raised, that the applicant has taken reasonable steps to have the issues resolved within the Union. I take into account that expulsion from membership of the Union may have serious consequences for the applicant. The applicant’s office with, and employment by the Union are the sources of his standing and livelihood. I consider that the applicant has raised a sufficiently strong prima facie case which, when taken together with the detriment that he might suffer, favours the granting of an interim order.

36    There was argument before me as to whether the applicant should give an undertaking as to damages. The first respondent did not request an undertaking. There is authority to the effect that an undertaking is not necessary in relation to the granting of an interim order under s 164 of the RO Act. However, that consideration has greater force when interim orders are in the nature of directions which are of a mandatory nature and which may be the product of full argument. In this case, where the application has been brought at short notice, where there has been only informal service of the respondents, and where only one respondent appeared, I consider it appropriate that the applicant give an undertaking as to damages as a condition of the interim order.

37    Therefore, upon the applicant giving the usual undertaking as to damages, I will order -

Upon the applicant giving the usual undertaking as to damages, and pursuant to s164(4) of the Fair Work (Registered Organisations) Act 2009 (Cth), until the hearing and determination of this proceeding or further order, the respondents be enjoined from proceeding to hear and determine the charges contained in the summons sent to the applicant on 20 November 2018.

Associate:

Dated:    4 December 2018

SCHEDULE OF PARTIES