FEDERAL COURT OF AUSTRALIA
O’Connor v Setka [2020] FCA 441
ORDERS
Applicant | ||
AND: | First Respondent ELIAS SPERNOVASILIS Second Respondent RALPH EDWARDS (and others named in the Schedule) Third Respondent | |
DATE OF ORDER: | 6 April 2020 |
THE COURT ORDERS THAT:
1. The proceeding be dismissed.
2. Any party wishing to do so is to file submissions on the question of costs within 7 days.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
O’CALLAGHAN J:
introduction
1 This proceeding arises from an internal demarcation dispute between the Manufacturing, and Construction and General, Divisions of the Construction, Forestry, Maritime, Mining and Energy Union (the Union or the CFMMEU) about which such Division is entitled to represent the interests of cabinet makers, floor layers and glaziers employed on construction sites in Victoria.
2 The applicant, Mr Michael O’Connor, (the applicant or Mr O’Connor) is a member of the Union. He is also its National Secretary and the Divisional Secretary of its Manufacturing Division.
3 The National Rules of the Union provide for the existence and operation of four Divisions: the Construction and General Division; the Manufacturing Division; the Mining and Energy Division; and the Maritime Union of Australia Division. Each of the Divisions has its own rules.
4 The Manufacturing Division is divided into Districts, one of which is the Victorian District.
5 The Construction and General Division is divided into Divisional Branches, one of which is the Construction and General Division, Victoria-Tasmania Divisional Branch (the Construction Branch).
6 The proceeding is brought against thirty respondents. Each of them is a member of the Union. They are members of, and comprise, the Divisional Branch Management Committee of the Construction Branch (the Victorian DBMC). Subject to review by the Divisional Branch Council, the Victorian DBMC has the care, control, superintendence, management and administration of the affairs of the Construction Branch (including dealing with applications for membership) and may exercise all of the powers of the Divisional Branch Council.
7 The first respondent, Mr John Setka, is the Branch Secretary of the Construction Branch. The second respondent, Mr Elias Spernovasilis, is the Branch Assistant Secretary of the Construction Branch.
8 The applicant commenced this proceeding under s 164 of the Fair Work (Registered Organisations) Act 2009 (Cth) (the RO Act) by way of an originating application dated 13 January 2020, seeking interim and final relief.
9 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.
10 An application for interim relief was made at a hearing on 11 February 2020. I declined the application, in circumstances where the parties agreed that a final hearing could commence, as it did, within two weeks.
11 The proceeding was conducted without pleadings, because the parties agreed that the essential question in dispute involves the proper interpretation of the National Rules.
12 It was common ground, and I accept, that the applicant has standing to bring the proceeding.
13 From around August 2019, the respondents, or some of them, began to encourage members of the Manufacturing Division to resign, and to join the Construction and General Division instead. As at the time of the hearing of this proceeding, over 200 members employed on construction sites and working in the floor laying, glass and cabinet making industries in Victoria had resigned from the Manufacturing Division and joined the Construction and General Division.
14 The applicant also complains that the Construction Branch has impermissibly taken part in enterprise agreement negotiations in the floor laying industry, which has resulted in the Construction Branch making a number of enterprise agreements with employers in that industry, some of which have been approved by, and others of which are pending in, the Fair Work Commission. Those complaints do not involve any separate legal question.
15 The applicant submits that all but one of the persons who have resigned from the Manufacturing Division and joined the Construction and General Division are not eligible on the proper construction of the National Rules to be members of the Construction and General Division and that they are only eligible to members of the Manufacturing Division. The applicant submits that the court should therefore make a declaration that persons eligible to be members of the Union pursuant to r 2(F) of the National Rules in Victoria are not eligible to be members of the Construction and General Division, and make orders in substance:
(1) enjoining the respondents from inducing further resignations;
(2) requiring the respondents to provide written instruction and direction to representatives of the Construction Branch to cease inducing further resignations;
(3) requiring the respondents to transfer back ineligible members, and to remit to the Manufacturing Division any contributions collected from those members; and
(4) enjoining the respondents from engaging in activities that would result in enterprise agreements being made covering ineligible members, and require the respondents to notify the applicant of any such enterprise agreement negotiations currently on foot.
16 The respondents submit that, on the proper construction of the National Rules, each of the relevant members rightly belongs to the Construction and General Division and that the proceeding should therefore be dismissed.
17 The National Rules, as I will need to explain in some detail, are principally the product of the following union amalgamations:
(1) The amalgamation in 1990 of the Australian Timber Workers’ Union and the Pulp and Paper Workers’ Federation of Australia to form the Australian Timber and Allied Industries Union (ATAIU).
(2) The amalgamation in September 1991 of the Building Workers’ Industrial Union of Australia (BWIU) with the ATAIU to form the ATAIU and BWIU Amalgamated Union.
(3) The amalgamation in February 1992 of the ATAIU and BWIU Amalgamated Union with the United Mineworkers’ Federation of Australia (UMW) to form the Construction, Forestry and Mining Employees’ Union.
(4) The amalgamation in September 1992 of the Construction, Forestry and Mining Employees’ Union, the Federated Engine Drivers’ and Firemen’s Association of Australasia (FEDFA) and the Operative Plasterers’ and Plaster Workers’ Federation of Australia (OPPWF) to form the Construction, Forestry, Mining and Energy Union (CFMEU).
(5) The amalgamation in March 1993 of the CFMEU, the Operative Painters and Decorators’ Union of Australia (OPDU), the Federated Furnishing Trade Society of Australasia (FFTS) and the Victorian State Building Trades Union (VSBTU) under the name of the CFMEU.
(6) The amalgamation in 1994 of the CFMEU and the Builders’ Labourers’ Federation (BLF), under the name of the CFMEU.
(7) The amalgamation in 2018 of the Maritime Union of Australia and the Textile, Clothing and Footwear Union of Australia with the CFMEU to form the CFMMEU.
18 A revised version of the National Rules was produced upon each amalgamation.
19 A number of the presently relevant National Rules are not models of good drafting. They lack internal consistency and they contain redundancies. Both the applicant and the respondents adduced evidence about the history of the rules on the basis that, in order properly to be construed, they must be construed in context. Accordingly, and because the parties relied on it, it will be necessary for these reasons to recite the history of the relevant rule changes which occurred upon each union amalgamation.
20 Ultimately, however, as the parties agreed, the role of the court is to undertake an exercise of interpretation of the rules in accordance with well-established principles.
21 Before turning to the rules, I should deal with a preliminary matter. Sub-section 164(3) of the RO Act provides that the court may refuse to deal with an application under s 164 unless it is satisfied that the applicant has taken all reasonable steps to try to have the matter resolved within the organisation. The respondent did not in the end seek to contend that the court should exercise its discretion to refuse to deal with the application under s 164(3) on the basis that Mr O’Connor had not taken such steps. He clearly had. The evidence demonstrates that:
(1) Mr Leo Skourdoumbis, the Senior Assistant Secretary of the Manufacturing Division, wrote to the Construction Branch seeking undertakings to resolve the dispute;
(2) Mr Skourdoumbis raised the dispute with the Divisional Secretary of the Construction and General Division, who then raised it with the Divisional Executive of the Construction and General Division;
(3) Mr O’Connor and Mr Skourdoumbis discussed and attempted to resolve the dispute at relevant meetings with senior Union officials that occurred in September, October and December 2019; and
(4) Mr O’Connor and Mr Skourdoumbis discussed and attempted to resolve the dispute during meetings with officials of the Construction Branch, including Mr Setka and Mr Spernovasilis, in October and November 2019.
22 It follows that no issue arises under s 164(3) of the RO Act.
The National rules
Rule 2
23 Rule 2 is headed “Constitution”. It comprises 40 of the 101 pages that comprise the National Rules. It contains provisions which have found their way into the rules as a result of the amalgamations mentioned earlier, and it identifies people who are eligible to be members of the Union by reference to their employment in, or in connection with, certain industries, occupations, callings, vocations, or industrial pursuits.
24 Rule 2(A)(A) relevantly provides as follows:
The following unlimited number of persons, whether male or female, are eligible to be members of the Union
(1) employed in, usually employed in or qualified to be and desirous of being employed in or seeking to be employed in or in connection with the industry or industries, and/or occupations, and/or calling, and/or vocations and/or industrial pursuits of
and/or
(2) who, otherwise than as employees or employers, follow an occupation in or in connection with the industries or industries of:
and/or
(3) who, otherwise than as employees or employers, are engaged in the industrial pursuits or pursuits of:
(i) carpenters or joiners … tilelayers … stonemasons, marble masons, polishers, machinists, sawyers and all other persons engaged in the dressing and preparation and/or erection of stone, marble or slate … bricklayers, tuckpointers, or in a trade or calling of a slater, roof tiler, shingler, ridger or cement tiler … in New South Wales journeymen and other labour engaged in the plate, sheet and ornamental glass trade … PROVIDED however that notwithstanding the foregoing:-
…
(e) In the States of Victoria, South Australia, Queensland, Tasmania and the Australian Capital Territory nothing in paragraph A(i) [sic] of this rule shall render eligible for membership any employee engaged in the plate, sheet and ornamental glass industries as defined in this sub-rule who is eligible for membership of the Federated Furnishing Trades Society of Australasia.
…
(iii) In the State of Victoria any process, trade or business in or of the plaster industry …
25 Rule 2(A)(b) relevantly provides as follows:
Without limiting the generality of any other subrule or paragraph or being limited thereby an unlimited number of persons employed in or seeking to be employed in or in connection with all or any of the industry and/or occupations and/or callings and/or vocations and/or industrial pursuits of the painting and decorating industry in connexion with buildings and structures, plant, machinery and equipment, fences and posts, (commercial, residential, industrial or otherwise), general and ship painting, shall be eligible to be members of the union including the following:
…
(e) glazing, glass cutting, glass processing, cutting and fixing vitrolite or like material, the fixing of glass by any means in any place prepared for its reception, fitting and fixing glazing bars (but excepting in the State of Victoria, South Australia and Tasmania only, any person who is eligible for membership of the Federated Furnishing Trade Society of Australasia) …
26 Rule 2(C) relevantly provides as follows:
Without limiting the generality of the foregoing and without being limited thereby the following are eligible to be members of the Union:
(i) All persons who are employed or are usually employed in any position on or in or in connection with (a) saws and woodworking machines; (b) handling and treating timber and articles manufactured therefrom; (c) sawmills, timber yards … (d) the preparing of woodwork for joiners, carpenters, builders …
(ii) An unlimited number of males and females engaged or usually engaged in any occupation connected with manufacture, processing and supply of pulp, paper, paper board, strawboard, plastic materials … paper bags or any similar commodity …
27 Rule 2(E) was inserted when the FEDFA was amalgamated. It relevantly provides as follows:
Without limiting the generality of the foregoing and without being limited thereby the following are eligible to be members of the Union:-
(a) An unlimited number of all classes of engine drivers, firemen, crane drivers, mobile crane drivers, forklift drivers, tow motor drivers, excavator drivers …
28 Rule 2(F) was inserted when the FFTS was amalgamated. It relevantly provides as follows:
Without limiting the generality of any other sub-rule or paragraph or being limited thereby an unlimited number of persons who are employed in, or competent to be employed in or in connection with the following industries or trades are eligible to be members of the Union:
… cabinet-makers … carpet and linoleum planners and all floor covering layers … [and] glaziers …
29 Rule 2(N) relevantly provides as follows:
Without limiting the generality of the foregoing and without being limited thereby, the following are eligible to be members of the Union: an unlimited number of persons whether male or female throughout the Commonwealth who are employed or usually employed in the Brick, Tile and Pottery Industry …
30 Rule 2(R) was inserted when the Textile, Clothing and Footwear Union of Australia was amalgamated. It relevantly provides as follows:
Without limiting the generality of Sub Rules (A) to (Q) and (S) herein or being limited thereby:
The Union shall consist of:
(a) Without limiting the generality of any other part of this rule, all persons wholly or partly engaged or usually engaged in or in connection with the following industries, mills, factories, places of work, products or processes in Australia:-
textile, woollen (other than wool scouring), worsted, wool tops, spinning, weaving, dyeing, finishing, waste-breaking, flock, wadding, felt and feltex, flax, cotton, carpets, silk and artificial silk, rayon and/or any vegetable or synthetic fibre …
31 Rule 2(S) was inserted when the Maritime Union of Australia was amalgamated. It relevantly provides as follows:
Without limiting the generality of Sub-Rules (A) to (R) herein or being limited thereby:
…
(a) The union shall be composed of any number of:
(i) bosuns, bosuns’ mates, quartermasters, storekeepers, able seamen, chief integrated ratings … sailors, deckhands, ordinary seamen … employees engaged on working on dredges, lighters, hulks, barges, punts, employees working on river and harbour vessels, including ferries, employees working on tugboats and tenders, employees working in the pilot services …
Rule 7
32 Rule 7 is headed “Membership”. Relevantly it provides as follows:
(i) A candidate for membership of the Union may make application to the National Secretary, the Division covering the occupation or industry in which the person is employed, the Branch covering the area in which the person is employed or resides, or the Divisional Branch covering the industry or occupation in which the person is employed, usually employed or desirous of being employed in the area in which the person resides or is employed, and such application shall be made and dealt with in the manner and subject to the conditions … required by the rules of the Division. Any application shall be forwarded to the office in the appropriate division which under the rules of that division deals with such applications. The decision to accept or reject that application shall be made in accordance with the Rules of that division by that office. Provided that where a person makes application to any officer of the Union that application shall be a valid application for membership of the Union and the Union shall, treat the member as a member of the Division to which the officer is attached, until transferred in accordance with the rules.
…
(iv) A member shall be attached to Division of the Union covering the industry or employment of the member and shall be in only one such Division. Each member shall be notified of the Division to which such member is attached or any other classification relevant to the Rules of the Union and such Division or classification shall be entered on the record of the Union in relation to that member which record shall be conclusive proof of the Division and/or classification to which that member is assigned.
(v) …
(b) Without affecting or detracting from the requirements of sub-rules 42(iii) and 42(xii) and without limiting the rights of a member or a Division, Divisional Branch or authorised officer thereof, to seek or obtain a transfer of Division or Divisional Branch in accordance with the rules, no membership of the union shall be invalidated, void or otherwise treated as irregular on account of the member being attached to a Division, Branch or Divisional Branch which, in accordance with the Rules, may not be the correct Division, Branch or Divisional Branch provided that the member was eligible for membership of the Union and the member was aware of the Division, Branch or Divisional Branch to which the member was attached …
…
(viii) …
(b) … where a Divisional Secretary or a Divisional Branch Secretary forms the view that a member of another Division or Divisional Branch ought to be a member of the Division or Divisional Branch to which the Divisional Secretary or Divisional Branch Secretary is attached, the Divisional Secretary or Divisional Branch Secretary shall contact the … Divisional Branch Secretary of the Divisional Branch to which the member is now attached and seek agreement that the member be transferred. Where agreement cannot be reached the matter may be referred to the National Secretary and be determined by the National Executive or an officer designated by the National Executive.
…
(d) Any determination by the National Executive or officer designated by the National executive shall use the principles established in and by sub-rules 42(i) and 42(iii) hereof.
Nothing in these paragraphs shall affect or detract from the provisions of sub- rule(s) 42(i), (iii) and (xii) and membership of a Division or a Divisional Branch shall be valid notwithstanding an irregularity in, breach of or failure to comply with the procedures in either one or both paragraphs (a) or (b) herein.
Rule 25
33 Rule 25 is headed “Alteration of Rules”. Rule 25(a) provides that the Rules “may be altered, rescinded, varied or made by the National Conference and/or National Executive”. Rule 25(d) contains a proviso to this position, as follows: “Provided that no rule change shall be effected without the approval of a Division, by either the National Conference, National Executive or National Executive Committee which affects the existence of that Division or interferes with its autonomy under these rules, including the internal structures of a Division”.
Rule 26
34 Rule 26 is headed “Rules Binding on Members, Branches and Divisions”. It provides as follows:
These National Rules and all the rules of the Union, and all alterations, additions or rescissions thereof or thereto, shall apply to and be binding on all Divisions, Branches, and Divisional Branches in all sections of the Union and all members who now, or who may hereafter, belong to the Union until they are made or become null and void according to the law.
Rule 27
35 Rule 27 is headed “Divisions”. Rule 27(i) provides:
There shall be Divisions of the Union established, in accordance with the Rules of the Union. Such divisions shall be established on a basis of industry or occupation.
Provided that upon the amalgamation of the Maritime Union of Australia and the Textile, Footwear and Clothing Union of Australia with the Union there shall be four (4) Divisions of the Union as follows:
(a) the Construction and General Division;
(b) the Manufacturing Division;
(c) the Mining and Energy Division; and
(d) the Maritime Union of Australia Division.
36 Rule 27(ii) provides:
Each Division shall have autonomy to decide matters which do not directly affect the members of another Division without any interference by any other body within the Union, including but not limited to:
(a) The industrial interests of its members.
(b) The election of officers within the Division.
(c) Matters arising from the objects of the Division.
(d) Structure of the Division.
37 Rule 27(iv) provides:
Each Division shall have rules and have power to make, alter or rescind such rules, to be called Divisional Rules. Without limiting the generality of the foregoing paragraph, each Division shall have power to determine policy for that Division, not inconsistent with the rules and policy of the Union as decided by National Conference or National Executive.
Rule 42
38 In his 19 February 2020 affidavit, Mr Martin Kingham, who is nowadays a shop steward and safety representative with Hutchinson Builders, and who worked in numerous roles within the BWIU and the CFMEU between 1981 and 2006, gave the following evidence, about which he was not cross-examined, concerning the role of Divisions in the Union over time and the purpose or object of r 42:
When the CFMEU first formed, its Divisions were based on membership of the old unions, prior to amalgamation. Over time, however, the agreed structure for the CFMEU was to form Divisions based on industries, rather than based on old demarcations between unions. This agreed structure is reflected in Rule 42 of the National Rules.
When Rule 42 was adopted, it was understood that union members would have to move across to new Divisions, depending on the type of work they did, and which industry they belonged to. This process was often referred to as ‘translation’. How the ‘translation’ of workers was to occur was discussed at state and national level.
39 Rule 42 is headed “Transitional Provisions – Original Amalgamation”. Relevantly it provides:
(i) Upon Amalgamation
On and from the date of amalgamation there shall be five (5) Divisions of the Union, being the Building Unions Division, the ATAIU Division, the UMW Division, the FEDFA Division and the FFTS Union Division. The Building Unions division shall be the former BWIU/Plasterers Division together with members and officers of the OPDU.
The Building Unions Division shall consist of those persons eligible and continuing to be eligible for membership of the union under Rule 2 (A) and (B), the ATAIU Division shall consist of those persons eligible and continuing to be eligible for membership of the Union under Rule 2 (C), the UMW Division shall be those persons eligible for membership and continuing to be eligible for membership of the union under Rule 2 (D) and the FEDFA Division shall be those persons eligible for membership and continuing to be eligible for membership of the Union under Rule 2 (E). The FFTS Union Division shall consist of all persons eligible and continuing to be eligible for membership of the Union under Rule 2(F) including all former members of the previously registered FFTS.
While the FFTS Union Division continues its separate existence, the demarcation between the FFTS Union Division and the other Divisions of the CFMEU shall be in accordance with the above demarcation on the basis of the status quo and custom and practice of coverage as it existed between the previously registered … Federated Furnishing Trade Society of Australasia and the CFMEU including therein demarcation disputes which have been determined by either State or Federal industrial authorities. Where any disagreement occurs between the FFTS Union Division and any other Division of the Union the matter shall be referred to the National Executive which shall determine the demarcation appropriate but such determination shall be based on the principles enunciated in this paragraph.
(ii) Upon amalgamation no person who was previously a member of either the CFMEU or OPDU or FFTS shall be liable for any entrance fee over and above the entrance fee already paid by such financial members.
(iii) After Amalgamation
Subject to any changes made by unanimous decision of the National Executive Committee following amalgamation, there shall be a restructuring of the Divisions on the following basis:
(a) There shall be created a restructured Mining and Energy Division which shall consist of all members of the union eligible to be members under Rule 2 (D) and all members, including members eligible under Sub-Rules 2 (A), (B), (C) and (E) employed in the Mining, Exploration and Energy Industries and all members employed in the County of Yancowinna:
(b) There shall be created a Forestry and Forest, Building Products Manufacturing Division (herein after referred to as the Forestry Division) which shall consist of all members of the union eligible to be members under Rule 2 (C) and all members, including members eligible under Sub-rules 2 (A), (B) and (E) employed in the following sectors of the industry (or occupations within them):
Forest and forest products industry,
Pulp and paper industry,
Timber and building related manufacturing industry including joinery, wall frame/roof trusses, furniture, aluminium windows, glass window manufacturing and any other sectors of manufacturing activity as agreed to between the ATAIU and the Building Unions and FEDFA Divisions of the union.
This sub-rule up until April 3rd 2000 shall be read subject to the agreement entitled CFMEU Forestry Division and CFMEU Construction & General Division Translation Agreement dated September 2nd 1998.
(c) There will be a Construction and General Division which shall consist of all members of the union employed in or in connection with the Construction industry (including shopfitting) and all other members of the Union not referred to in sub-rules (iii) (a) (b) and (d) herein.
(d) deleted
(iv) The transfer of members from any Division to any other Division in accordance with the restructuring proposals in sub-rule (iii) herein, shall be on terms as agreed to by the Divisions concerned in the transfer and sub-rule (iii) shall be used as the basis of an agreement.
(v) In the event of further amalgamations other Divisions may be established.
40 Rule 42D has been deleted. It expired in 2005 (although for some unknown reason it remained in the rules until 2018). The applicant relies on r 42D, which dealt in terms with the divisional restructuring of the FFTS, for a critical plank of his case, as I will explain later. It was inserted into the rules in July 2002 and provided:
42D – DIVISIONAL RESTRUCTURING (FFTS)
1. Notwithstanding any other Rule of the Union to the contrary, the process of restructuring may be completed in steps, such steps may deal with one Division at a time and/or Divisional branches within a restructured Division at a time.
2. In relation to the above, the FFTS Division shall on and from the 11th February 2002, be restructured in the first instance into the Forestry Division to form “The Forestry, Furnishing, Building Products and Manufacturing Division” (FFPD) which shall result in:
(a) The abolition of full-time FFTS Divisional Officers at a national level and the allocation of responsibility for the FFTS Division to the restructured Division.
(b) The allocation of Divisional/Branch Office Holders of the FFTS Division to the Office Holders positions of the restructured Division.
(c) The continued operation of the Victorian and Queensland Divisional Branches of the FFTS Division within the restructured Division of up to four years beyond the expiration of the eight years referred to in sub-rule 42(xii). This sub-rule shall not otherwise affect the operation of sub-rule 42(xii). For the avoidance of doubt, the four years referred to in this sub-rule shall expire on 26 March 2005.
3. Further to the above provisions and notwithstanding any other rule of the Union to the contrary, the FFTS Victorian Branch shall unless otherwise agreed by the FFTS Victorian Branch Management Committee maintain its current structure and existence within the restructured Division up until 26 March 2005.
4. Prior to the 26 March 2005, The Forestry and Furniture products Division (which shall include representatives of the former FFTS Division) and the Construction & General Division (which shall include representatives from the National Office and all interested Branches) will meet under the chairpersonship of the National Secretary of the CFMEU to reach agreement to finalise translation/integration provisions intended by the respective Schemes of Amalgamation and the Rules of the Union in respect to the Forestry, FFTS and C&G Divisions.
5. Should agreement not be reached between the Divisions the matter shall be referred to the CFMEU National Executive to determine in accordance with the Schemes of Amalgamation and Rules of the Union.
41 The current divisional structure (see r 27(i) extracted at [35] above) has its origins in the 1992 “Scheme for Amalgamation of Construction, Forestry and Mining Employees Union (CFMEU) and the Federated Furnishing Trade Society of Australasia (FFTS), the Operative Painters and Decorators Union of Australia (OPDU) and the Victorian State Building Trades Union (VSBTU)” (the Scheme for Amalgamation).
42 Mr Ralph Edwards is the third respondent. He is the President of the Construction Branch. He has been an elected office holder in the Union since 2000 and has worked in the construction industry since the early 1970s. He was previously a member of the BLF, the BWIU, the FEDFA, and the Australian Manufacturing Workers’ Union.
43 Mr Edwards deposed that between September 1991 and March 1993, the CFMEU was created out of a series of amalgamations, which “occurred in line with the general policy of the Australian Council of Trade Unions and the Hawke ALP government from 1989 onwards to drive union amalgamations across the labour market”.
44 He also deposed that the FFTS, which was one of the last unions to amalgamate, first commenced amalgamation negotiations with the BWIU in 1989 and that “[o]n 3 November 1992, a written agreement was formed between the CFMEU … the FFTS, the OPDU and VSBTU … titled the Scheme for Amalgamation of CFMEU, FFTS, OPDU and the VSBTU … [and it] expressed the terms of the final round of amalgamation”.
45 The Scheme for Amalgamation relevantly provided:
Structure
10. The new CFMEU will consist of five (5) National Divisions (Building Unions Division, ATAIU Division, UMW Division, FEDFA Division and FFTS Union Division) and each Division shall consist of a number of Divisional Branches (State and District).
11. The existing BWIU/Plasterers Division shall become the Building Unions Division which shall incorporate the VSBTU and OPDU.
All existing Divisions will continue to operate and there shall also be a new Division being the FFTS Union Division.
…
13. …
(e) All persons who are or who become members of the new CFMEU who are covered by that part of the Eligibility Rule which was formerly that of the FFTS shall be assigned to the FFTS Union Division of the new CFMEU.
Industry Divisions
14. It is proposed that subsequent to amalgamation the Union Divisions (ie Building Unions Division, UMW Division, ATAIU Division, FFTS Union Division) will be restructured into Industry Divisions (namely, Construction; Forestry, Forest & Building Manufacturing Products; Mining; and Energy Divisions). The FFTS Union Division shall have eight (8) years in which to reach agreement on the way in which that restructuring will occur, during which time the FFTS Union Division will be autonomous in those matters that relate to members of that Division only.
…
15. It is the current intention that the FFTS Union Division will be restructured after a maximum of eight (8) years substantially into Forestry, Forest and Building Manufacturing Products Division.
The DIVISIONAL rules
46 The “Rules of the CFMMEU, the Manufacturing Division” (Manufacturing Division Rules) contain a provision (r 2) headed “Eligibility for Division” which provides: “Every member who is a member of the union by virtue of Rule 2 Sub-Rule (C), (F) and (R) of the National Rules shall belong to this Division”.
47 The “Rules of the CFMEU Construction and General Division and Construction and General Divisional Branches” (Construction and General Division Rules) contain a provision (r 2) which relevantly provides:
Every member who is a member of the union of virtue of Rule 2 Sub-rules (A), (B) and (N) of the National Rules shall belong to this Division.
Further, every member who is a member of the Union by virtue of Rule 2 sub-rule (E) of the National Rules, shall also be eligible for membership of this Division.
48 The Maritime Union of Australia Division Rules contain a provision (r 3) headed “Eligibility for Division” which provides: “Every member who is a member of the Union by virtue of Rule 2(S) (Eligibility) of the National Rules shall belong to this Division”.
The evidence
49 Mr O’Connor relied upon the following evidence:
(1) His affidavits affirmed on 10 January 2020 and 7, 11 and 14 February 2020. Among other things, Mr O’Connor deposed to the involvement of the respondents in the conduct that he contends is in breach of the National Rules. There was no dispute about the fact that the respondents, or some of them, have procured the resignations referred to above, so there is no need to rehearse the evidence on that topic in these reasons. Mr O’Connor also gave evidence about his attempts to resolve the dispute internally, which I accept as explained above at [21]. Mr O’Connor also gave evidence in his third affidavit, about which he was cross-examined, that r 42 of the National Rules was never “implemented”. It will be necessary to recite that evidence, and the case put against it by the respondents, later in these reasons. He also deposed in his third affidavit that “there was never any restructuring” of the Manufacturing Division (previously the Forestry, Furnishing, Building Products and Manufacturing Division (FFPD)) and the Construction & General Division pursuant to rule 42(iii) of the National Rules. He further deposed in his fourth affidavit that the Construction and General Division and the FFPD failed to reach agreement under the process in r 42D regarding the restructuring of the FFTS Victoria Branch, and of the failure of the National Executive Council and the National Executive to impose a resolution.
(2) Affidavits of Leo Skourdoumbis affirmed on 8 January, 7 February and 21 February 2020. As noted above, Mr Skourdoumbis is the Senior Assistant Secretary of the Manufacturing Division of the CFMMEU. He deposed, among other things, to facts no longer in dispute about the involvement of the respondents in the alleged conduct in breach of the National Rules. He was cross-examined.
(3) An affidavit of Trevor Smith affirmed on 14 February 2020. Mr Smith is a life member of the CFMMEU. When he retired in April 2006 he was the National President of the Union and the National Divisional Secretary of the FFPD. He gave evidence about the non-implementation of r 42 along the same lines as Mr O’Connor, and he was cross-examined about it.
(4) A solicitor’s affidavit of Phillip John Pasfield sworn on 25 February 2020 (producing material relevant to historical amendments to the National Rules).
(5) An affidavit of Steve Abboushi sworn on 10 January 2020 (deposing to the involvement of the respondents in the conduct alleged to be in breach of the National Rules).
50 The respondents relied upon the following evidence:
(1) Affidavits of Ralph Edwards affirmed on 5 February 2020 and 19 February 2020. As noted above, Mr Edwards is the President of the Construction Branch. He gave evidence about the history of amalgamations; the distinction between “on-site” construction work, on the one hand, and “off-site” manufacturing work on the other hand; and the different on-site and off-site jobs performed by floor layers, glaziers and cabinet makers. He was cross-examined.
(2) An affidavit of Martin Kingham affirmed on 19 February 2020. He gave evidence about the historical role of the Divisions within the CFMMEU, translation of members under the National Rules and the distinction between on-site and off-site workers.
(3) Solicitor’s affidavits of Declan Vincent Murphy affirmed on 19 and 24 February 2020 (producing material relevant to historical amendments to the National Rules).
(4) Affidavits of: Andrew Smith affirmed on 19 February 2020; Mansour Taghinejad affirmed on 19 February 2020; Peter Ngauamo sworn on 4 February 2020; John Kevin Semmens affirmed on 5 February 2020; Jay Rose affirmed on 4 February 2020; Benjamin George Smart affirmed on 4 February 2020; Boipelo Sithole affirmed on 5 February 2020; Andrew Doughty sworn on 3 February 2020; Adam Tester sworn on 4 February 2020; and Benjamin James Galeney affirmed on 5 February 2020. Those individuals are, variously, glaziers, floor layers or cabinet makers, who deposed to the nature of the work that they perform on construction sites and the circumstances of their resignations from the Manufacturing Division and of their joining the Construction and General Division, none of which was controversial and none of which was referred to in closing addresses as having any bearing on the question of the proper construction of the rules.
(5) A solicitor’s affidavit of Daniel James Victory affirmed on 5 February 2020, relating to the applicant’s efforts, through his solicitors, to resolve the dispute within the Union.
51 Ultimately, the only affidavit material which the parties said was of particular relevance to any issue concerning the question of the construction of the National Rules was the following:
(1) documents proving the history of the National Rules;
(2) documents produced by Mr Edwards explaining the history of the union amalgamations (including that of the FFTS with the CFMEU) (referred to at [43]ff above), including the Scheme for Amalgamation;
(3) the passage from Mr Kingham’s affidavit extracted at [38] above; and
(4) parts of the evidence given by Mr O’Connor and Mr Smith (to which I will next turn).
52 To the limited extent to which some deponents purported to give evidence of their subjective understanding of the meaning of the National Rules, most of it was excluded by agreement. To the extent that such expressions of understanding remained in evidence, I have had no regard to them.
The contention that rule 42 was never “implemented”
53 In his third affidavit dated 11 February 2020, Mr O’Connor sought to respond to the submission made at [37] of the Respondents’ Outline of Submissions on Interlocutory Relief dated 10 February 2020. That submission at [37] stressed the central importance of r 42(iii) to the respondents’ defence to the applicant’s claim (including the claim for interlocutory relief then on foot) and read as follows:
The demarcation between the Construction and General, Mining and Energy, and Manufacturing Divisions is governed by Rule 42(iii). The critical provision is sub-rule 42(iii)(c), which places all members ‘employed in or in connection with the Construction industry (including shopfitting)’ within the Construction and General Division. On its ordinary meaning, this sub-rule makes it clear that, regardless of where in Rule 2 one might find the relevant description of a particular member’s occupation, that member will fall within the Construction and General Division so long as their employment is properly characterised as being in, or in connection with, the construction industry.
54 Mr O’Connor responded to this submission at [3]-[7] of his third affidavit, as follows:
I refer to the respondents’ Outline of Submissions filed yesterday and in particular those submissions commencing at paragraph 37 concerning the operation of National Rule 42(iii).
Subsequent to the receipt of the Outline of Submissions I had a telephone conversation with Trevor Smith, who was the former National Secretary of the Forestry Division at the time that National rule 42 commenced operation.
Mr Smith informed me that National Rule 42(iii) was never implemented. There was never any restructuring of the two Divisions as envisaged by the sub-rule as the C&G Division refused to agree to such a restructure. As such there was no implementation of any agreement between the two Divisions to transfer members from a Division to another Division in accordance with the restructuring proposals contained in sub-rule 42(iii). Mr Smith further informed me that there may have been some transfer of members between the Divisions which occurred after the amalgamation but these would have been minimal.
The information provided by Mr Smith is consistent with my own knowledge of the matter and I believe it to be true and correct.
It is my understanding that the C&G Division did not agree to a restructure as overall, they would lose members under the proposed restructure.
55 Mr Smith also deposed in his affidavit dated 14 February 2020 that “National Rule 42(iii) was never implemented” and that “[t]here was never a restructure between the Forestry and Construction Divisions”. He also gave evidence about a so-called “Translation Agreement” dated 2 September 1998 between the CFMEU Forestry Division and the CFMEU Construction and General Division, in response to evidence given about it in the first affidavit of Mr Edwards. The agreement was not said in the course of closing addresses to have any particular significance, so it is unnecessary to say anything further about it.
56 During his closing submissions, Mr Borenstein QC, who appeared with Mr Fetter and Mr Bakri for Mr O’Connor, put the case somewhat more equivocally, contending instead that r 42(iii) was not “fully implemented” (rather than “never implemented” as Mr O’Connor and Mr Smith deposed).
57 The respondents contend that the history of r 42(iii), among other things, stands positively against a finding that it was “not implemented”, so I will deal with the point later in these reasons, after I have set out of the relevant history.
the history of rule 42
58 The applicant submitted (and the respondents contested) that the history of r 42 supports these propositions:
(1) r 42(iii) in its various iterations was always “a work in progress” and “a plan or an aspiration”;
(2) because by 2005 no agreement was ever reached about the amalgamation of the FFTS Division “the situation was left by the union on the basis that was set out in rule 42D and in the resolutions [of the National Executive and the National Executive Committee] in 2002” – that is, that the FFTS Division was integrated into what is now the Manufacturing Division; and
(3) that is the position reflected in the current Manufacturing Division Rules, which identify members described in r 2(F) of the National Rules as being eligible for membership of the Manufacturing Division.
59 Rule 42 first appeared at the time of the amalgamation of the ATAIU and BWIU, which became the “ATAIU and BWIU Amalgamated Union” on 23 September 1991. In its original form, r 42 relevantly provided as follows:
(i) On and from the date of amalgamation there shall be two (2) Divisions of the Union, being the BWIU Division and the ATAIU Division.
The BWIU Division shall consist of those persons eligible and continuing to be eligible for membership of the union under Rule 2 (A) and (B), and the ATAIU Division shall be those members eligible for membership and continuing to be eligible for membership of the union under Rule 2 (C).
(ii) Upon amalgamation no person who was previously a member of either the BWIU or ATAIU shall be liable for any entrance fee over and above the entrance fee already paid by such financial members.
(iii) Following amalgamation there shall be a restructuring of the Divisions on the following basis:
(a) There shall be created a Forestry and Forest, Building Products Manufacturing Division (herein after referred to as the Forestry Division) which shall consist of all members of the union eligible to be members under Rule 2 (C) and all members, including members eligible under Sub-rules 2 (A) and (B), employed in the following sectors of the industry:
Forest and forest products industry,
Pulp and paper industry,
Timber and building related manufacturing industry including joinery/shopfitting, wall frame/roof trusses, furniture, glass window manufacturing and any other sectors of manufacturing activity as agreed to between the ATAIU and the BWIU Divisions of the union.
(b) There will be a Construction Division which shall consist of all other members of the union.
(iv) The transfer of members from the BWIU Division to the new Forestry Division shall be on terms as agreed to by the two Divisions and shall use as a guide the immediately preceding paragraph.
(v) In the event of further amalgamations other Divisions may be established.
…
(xii) The restructuring referred to herein shall be effected within four (4) years from the date of the amalgamation. If no agreement has been reached by that date then notwithstanding any other rule of the Union the National Executive shall determine the changes necessary to effect such restructuring including any and all rule changes therefore.
…
60 On 10 February 1992, the ATAIU and BWIU Amalgamated Union amalgamated with the United Mineworkers’ Federation of Australia and became known as the Construction, Forestry and Mining Employees’ Union. Rules 42(i), (ii) and (iii), which originally referred to the BWIU Division and the ATAIU Division, were amended so that they also referred to the new Mining Division. Rule 42(iii) was amended to provide for the Mining Division as follows:
(iii) Following amalgamation there shall be a restructuring of the Divisions on the following basis:
(a) There shall be created a restructured Mining Division which shall consist of all members of the union eligible to be members under Rule 2 (D) and all members, including members eligible under Sub-Rules 2 (A), (B) and (C), employed in the Mining industry.
…
61 The provisions in r 42(iii) relating to the Forestry Division and the Construction Division were moved from paragraphs (a) and (b) to paragraphs (b) and (c), but otherwise remained the same. The Forestry Division continued to comprise members eligible under r 2(C) and certain members eligible under rr 2(A) and (B); and the Construction Division continued to comprise all members of the Union not otherwise allocated. Rule 42(xii) was not amended, and continued to provide that the restructuring was to be effected within “four (4) years from the date of amalgamation”.
62 On 23 September 1992, the Construction, Forestry and Mining Employees’ Union amalgamated with the FEDFA and the OPPWF and became the Construction, Forestry, Mining and Energy Union. A number of further changes were made to the rules, including the following:
(1) Rule 42(iii)(c) was amended so that the Construction Division would now comprise “all members of the union employed in or in connection with the Construction industry”, rather than simply “all other members of the Union”.
(2) Rule 42(iii)(d) was added, which provided that there was to be “an Energy Division which will consist of all other members of the Union.”
(3) Rule 42(iv) was amended. This provision had previously stated that the transfer of members between Divisions as part of the restructuring was to be done using r 42(iii) “as a guide”. It now provided that r 42(iii) was to be used instead “as the basis of an agreement” between the Divisions involved in the transfer.
(4) Rule 42(xii), concerning the time in which the restructuring was to be effected, was moved to r 42(xiii) and amended to provide as follows:
The restructuring referred to herein shall be effected within four (4) years of the 23 September 1991. Except in the case of the FEDFA Victorian Branch which shall become the CFMEU, FEDFA Victorian Divisional Branch such restructuring may be effected at a time later than 23 September 1995 but shall be effected before 23 September 1999. If no agreement has been reached by the dates set out herein then, notwithstanding any other rule of the Union, the National Executive shall determine the changes necessary to effect such restructuring including any and all rule changes therefore.
63 On 3 November 1992, the CFMEU agreed under the Scheme for Amalgamation to further amalgamations with the FFTS, the OPDU and the VSBTU.
64 The Scheme for Amalgamation included the following provisions:
(1) Clause 5 was headed “Proposed Change to the Description of Industry and Eligibility Rule” and provided as follows:
The Industry and Eligibility Rules of the new CFMEU will incorporate the existing CFMEU rules and added to that will be the Eligibility Rules of the FFTS, OPDU and VSBTU and only persons eligible for membership of any of the amalgamating unions before the amalgamation shall be eligible for membership of the new amalgamated union after amalgamation.
(2) Clause 11 provided that there was to be, among other things, a new “FFTS Union Division” (the FFTS Union Division or the FFTS Division).
(3) Clause 14 stated:
It is proposed that subsequent to amalgamation the Union Divisions (ie Building Unions Division, UMW Division, ATAIU Division, FFTS Union Division) will be restructured into Industry Divisions (namely, Construction; Forestry, Forest & Building Manufacturing Products; Mining; and Energy Divisions). The FFTS Union Division shall have eight (8) years in which to reach agreement on the way in which that restructuring will occur, during which time the FFTS Union Division will be autonomous in those matters that relate to members of that Division only.
Members, Officers, Executive Members, Organisers etc will be attached to the appropriate Industry Division by agreement between the Union Divisions affected by the restructuring.
(4) Clause 15 stated:
It is the current intention that the FFTS Union Division will be restructured after a maximum of eight (8) years substantially into Forestry, Forest and Building Manufacturing Products Division.
(5) Clause 27 set out a statement of principles relevant to the amalgamation, including the following:
The rights, history and tradition of the members of each union should be fully respected and provisions made for continuity of membership and existing rights in the CFMEU.
65 Following the Scheme for Amalgamation, on 26 March 1993, the FFTS, the OPDU and the VSBTU amalgamated with the CFMEU. Rule 42 was further amended to accommodate this amalgamation. In particular, r 42(xiii) was amended to provide as follows:
The restructuring referred to herein shall be effected within four (4) years of the 23 September 1991. Except in the case of the FEDFA Victorian Branch which shall become the CFMEU, FEDFA Victorian Divisional Branch such restructuring may be effected at a time later than 23 September 1995 but shall be effected before 23 September 1999. Further provided that in relation to the FFTS Union Division it may have a separate existence for a period of up to eight years which period shall be shortened only with the agreement of the Divisional Executive of the FFTS Union Division and the eight (8) years shall commence on the date of effect of amalgamation of the FFTS and CFMEU. If no agreement has been reached by the dates set out herein then, notwithstanding any other rule of the Union, the National Executive shall determine the changes necessary to effect such restructuring, including any and all rule changes therefor. It is the current intention that the FFTS Union Division will be restructured after a maximum of eight (8) years substantially into Forestry, Forest and Building Manufacturing Products Division.
66 In addition, while r 42(iii) continued to provide for membership of the Mining Division (paragraph (a)), the Forestry Division (paragraph (b)) and the Construction Division (paragraph (c)), the following proviso was inserted at the end of the rule:
Provided that the restructuring referred to above shall not affect the separate existence of the FFTS Union Division for the time specified in this Transitional Rule.
67 On 4 June 1993, the following italicised words were inserted into the introductory text of r 42(iii): “Subject to any changes made by the National Executive Committee, following amalgamation there shall be a restructuring of the Divisions on the following basis”.
68 In May 1994, the following italicised words were inserted into the introductory text of r 42(iii): “Subject to any changes made by unanimous decision of the National Executive Committee, following amalgamation there shall be a restructuring …”
69 On 5 May 1995, minor amendments were made to r 42, including the following amendments to r 42(iii):
(1) Rule 42(iii)(a) was amended to refer to the Mining and Energy Division, rather than the Mining Division.
(2) Rule 42(iii)(d), which previously dealt with the Energy Division, was removed.
(3) The proviso below r 42(iii) which stated that “the restructuring referred to above shall not affect the separate existence of the FFTS Union Division for the time specified” was renumbered r 42(iii)(d) and was extended to cover not only the FFTS Union Division but also “untranslated FEDFA Divisional Branches”.
70 On 7 July 1995, r 42(iii)(c) was amended so that the Construction Division, by now called the Construction and General Division, once again comprised all members not otherwise allocated under one of the other provisions of r 42(iii), subject to the proviso in favour of the FFTS and the FEDFA in r 42(iii)(d). Other amendments deferred aspects of the FEDFA restructure to 2 January 1997. The rule concerning the time in which the restructuring was to be effected was moved from r 42(xiii) to its original position at r 42(xii).
71 On 6 August 1996, r 42(xii) was altered to extend the deadline for restructuring (aside from the FFTS and FEDFA) to 1 April 1997.
72 In 1999, a new paragraph was added to the foot of r 42(iii)(b), which referred to the Translation Agreement between the Construction and General Division and the Forestry Division. “Shopfitting” was removed from paragraph (b) of r 42(iii) (dealing with the Forestry Division) and inserted into paragraph (c) (dealing with the Construction and General Division).
73 On 19 July 2002, r 42D was inserted into the rules. Rule 42D, which as discussed above expired in 2005, and has been deleted, is set out in full at [40] above.
74 On 28 October 2003, further changes were made to r 42, including the following:
(1) References to the FEDFA Division were deleted (because its members had by then been integrated into other Divisions of the Union).
(2) Rule 42(xii) was deleted. (It had provided for the FFTS Union Division to have “a separate existence for a period of up to eight years” and that “[i]t is the current intention that the FFTS Union Division will be restructured after a maximum of eight (8) years substantially into Forestry, Forest and Building Manufacturing Products Division”, among other things.)
(3) Rule 42(iii)(d) was deleted. (It had provided that “the restructuring referred to above shall not affect the separate existence of the FFTS Union Division and untranslated FEDFA Divisional Branches for the time specified”).
75 The applicant also relied on the minutes of a National Executive meeting held in February 2002 as part of the history relevant to his contention that, because by 2005 no agreement was ever reached about the amalgamation of the FFTS Division, “the situation was left by the union on the basis that was set out in rule 42D” (namely, that the FFTS Division was to be integrated “in the first instance” into what is now the Manufacturing Division). At that meeting, it was agreed that, prior to March 2005, the FFPD, including representatives of the former FFTS Division, would meet with the Construction and General Division to finalise translation and integration provisions provided for in the Scheme of Arrangement and the National Rules. Rule 42D was approved for insertion into the National Rules at another meeting of the National Executive in May 2002.
76 The applicant also relied on the minutes of the National Executive Committee meetings held on 2 March 2005 and 13 September 2005. Counsel for the applicant accurately summarised that evidence as follows:
March 2005
… 26 March 2005 was the deadline for the Construction and Manufacturing Divisions to either agree on a final settlement, or else refer the matter to the National Executive for decision.
In about June 2004, the National Secretary, John Maitland had recommended that the FFTS coverage stay entirely within the Manufacturing division. On 2 March 2005, the National Executive Committee was told that the two divisions had been unable to agree, and that “it was now time” for the National Executive to make a decision. However, on that occasion, the Committee decided to hold over its decision until the next meeting.
On 25 March 2005, the deadline under rule 42D came and went.
September 2005
On 13 September 2005, the next meeting of the National Executive Committee took place. The Committee again resolved not to deal with the FFTS integration matter. The National Executive never took any further steps in the matter.
THE PARTIES’ SUBMISSIONS
The parties’ characterisation of the issue
77 Mr Borenstein characterised the central issue for determination in this proceeding as “whether members of the [U]nion in Victoria who fall within the occupations described in National Rule 2(F) are eligible to be members in the Construction and General Division in its Victorian branch”. In his closing address, and consistently with what was said in writing, Mr Borenstein described the “essential issue” as whether the respondents, by enrolling into the Construction and General Division persons who are eligible to be members of the Union under National r 2(F), are in breach of the National Rules.
78 Mr Dowling SC, who appeared with Mr Doyle and Mr Tran for the respondents, described the principal issue in similar terms, as follows: does allocation of membership to individual Divisions depend only upon the application of r 2 of the National Rules and the divisional rules (the applicant’s case) or does allocation depend upon r 42(iii) (the respondents’ case)? He submits that if that question is answered adversely to the applicant, it follows that his application must be dismissed.
The applicant’s case
79 The applicant relies on the following passage from the judgment of Barwick CJ in R v Cohen; Ex parte Motor Accidents Insurance Board (1979) 141 CLR 577 at 580 (Cohen’s case) for the proposition that the question of the meaning of the National Rules is to be seen from the standpoint of a prospective member:
The first matter to be decided, in my opinion, is the precise meaning and scope of the eligibility clause. There is no reason, in my opinion, to read it otherwise than in its natural and ordinary sense. There are, of course, occasions when one needs to be generous in the interpretation of documents prepared in the industrial field. There is, however, nothing of that kind involved in the construction of the words of this eligibility clause. There is in the case of an eligibility rule the consideration that the employee himself must know whether or not he is qualified to join a particular industrial organization. This consideration underlines the necessity to give the words of the eligibility clause their ordinary significance as they would be understood by the employee. Further, in my opinion, there is no need to expand the area of the eligibility clause beyond the ordinary meaning of the words it employs. After all, the area for inter-union disputation about union coverage is already large enough and fraught with great peril to the national interest.
(Citations omitted, emphasis added.)
80 The applicant submits that “the clear and obvious reading of the rules, and one which is readily accessible to a prospective member, is to start with National Rule 2 and to identify the various categories of members that are described there”. (Relevantly, r 2(F), as set out above, provides that “ … an unlimited number of persons who are employed in, or competent to be employed in or in connection with the following industries or trades are eligible to be members of the Union: … cabinet-makers … carpet and linoleum planners and all floor covering layers …[and] glaziers”.)
81 The applicant further submits that “[a] prospective member would start there to see whether he or she is eligible to be a member of the [U]nion at all” and “[h]aving established that he or she comes within one of these categories in National Rule 2, the prospective member would then examine the rules of the various divisions to see into which division he or she fits.” He next submits that following that process the member, if he or she was in a trade or vocation referred to in National Rule 2(F), would find in r 2 of the Manufacturing Division Rules that the allocation of that trade or vocation had been made to the Manufacturing Division “without any qualification”. (Those rules, it will be recalled, provide that “[e]very member who is a member of the union by virtue of Rule 2 Sub-Rule (C), (F) and (R) of the National Rules shall belong to this Division”.)
82 The applicant submits that “that is the straightforward and common-sense process of construing the rules to establish where various members belong within the competing divisions … [which] follows the guidance of Barwick CJ in Cohen’s case”.
83 The applicant submits that the respondents’ case that r 42(iii) controls the allocation of members between the Construction and General Division and the Manufacturing Division should not be accepted because the respondents cannot point to any rule “which derogates from the allocation which is explicitly set out in rule 2 of the Manufacturing Division [R]ules” and cannot explain why “if the employees that are in issue here are properly eligible” to be members of the Construction and General Division “why the rules of that division where they expressly address who shall belong to that division make no reference to them”.
84 The applicant made the following submissions founded principally on the history of r 42, and in particular the history of it in relation to the former FFTS Division:
(1) Rule 42 was not “self-executing” when it was passed and was, as Mr O’Connor and Mr Smith deposed, never implemented, or never “fully” implemented. This was said to be the case because: (a) the statement in r 42(iii) that “there shall be” a restructuring is expressed in the future tense; (b) when r 42 was introduced, r 42(xii) (later r 42(xiii)) acknowledged that the proposed restructuring may require further rule changes; (c) r 42 continued to be amended after the FFTS joined the Union, including when the deadline it imposed upon restructuring was extended – these amendments demonstrated that the restructuring was still a “continuing process” and a “work in progress”; and (d) r 42D, which was inserted to deal specifically with the integration of the FFTS, “bypassed rule 42(iii)”.
(2) The deletion in October 2003 of r 42(iii)(d), which had read “[p]rovided that the restructuring referred to above shall not affect the separate existence of the FFTS Union Division and untranslated FEDFA Divisional Branches for the time specified in this Transitional Rule”, was a “technical amendment consequent upon the abolition of the FEDFA division” and was not intended to work any changes to the allocation of ex-FFTS Division members at the time.
(3) The entry of the FFTS Division into the amalgamation was not necessary to be recorded in r 42(iii) “because it was protected by the third paragraph of [r 42](i) which provided for it to stand alone”.
(4) Rule 42D “did the job [in 2002] of transferring or restructuring the FFTS Division into the Manufacturing Division” and the “proper conclusion is that the position of ex-FFTS Division members was by [October 2003] enshrined in and protected by r 42D, such that the deletion of r 42(iii)(d) could not have any effect on them”.
(5) By September 2005 “the ‘transitional’ arrangements under rules 42 and 42D applying to what had once been the [FFTS] union came to an end, in a practical and a legal sense” and by then “the default position under rule 42D to give the coverage of the former FFTS Division to the Manufacturing Division became fixed because there had not been any contrary agreement with the Construction Division or National Executive decision”.
(6) “In the absence of any such contrary agreements or decisions, rule 42D worked the result that the Manufacturing Division took coverage of all of the former FFTS coverage” and “[i]n those circumstances, on and from September 2005 (if not from 25 March 2005), the Manufacturing Division has had lawful and exclusive coverage of the rule 2(F) members”.
(7) That position with respect to lawful and exclusive coverage is the “position [that] is explicitly reflected in the Rules, in that the Manufacturing Division’s rules specify that rule 2(F) members belong to that division, and the Construction Division’s rules do not extend to rule 2(F) members”.
85 The applicant also submitted that r 2 of the National Rules could provide an appropriate basis for allocating members between the Divisions of the Union, because “there is no potential for overlap” (such that a worker might fall within multiple parts of r 2, each allocated to a different Division). This was said to be the case because the provision of rule 2 that most specifically and accurately described the worker’s activities would prevail over any other more general provision.
The respondents’ case
86 Mr Dowling emphasised these points in his closing address:
(1) The Union is presently divided into four industry divisions.
(2) Whatever time limits may have been imposed from time to time on the restructure, the former FFTS is now part of the Manufacturing Division.
(3) Rule 42 is the only rule that directly serves the purpose of allocating members to Divisions within the Union.
(4) Rule 2, on the other hand, is a rule about eligibility for membership of the Union as a whole and is deliberately drafted to avoid any particular category being read down so as to avoid overlap.
(5) The applicant’s case that r 42D did not fully realise an agreement, and that r 42 was not “fully implemented”, means that, if accepted, the “FFTS members” are in a different position to all other members of the Union: although every other member of the Union is allocated to a Division along industry lines, the FFTS members are not.
(6) On Mr O’Connor’s case, although r 7 expressly provides that a dispute about divisional membership is to be resolved in accordance with rr 42(i) and (iii), any dispute involving FFTS members is to be resolved only in accordance with r 2(F).
(7) The divisional rules cannot determine the boundaries between Divisions, “because you would not be able to determine when another division is intruding on your rights without a tiebreaker or without a higher rule to determine … that contest.”
(8) Deleted r 42D was only ever intended to operate consistently with the schemes of amalgamation and the Rules of the Union, as identified in it (viz, rr 7 and 42 of the National Rules).
87 In their more detailed written closing submission, the respondents’ counsel contended that the proposition that r 42(iii) of the National Rules determines the Division to which a person is allocated under the National Rules, assuming that that person is eligible to be a member of the Union under r 2, “follows from a traditional analysis of the text, context and purpose of the National Rules” and “is supported also by history”.
88 The respondents say that the introductory words of r 42(iii), namely, “there shall be a restructuring of the Divisions” on the basis set out in that paragraph, mean that the natural and ordinary meaning of the words is concerned with the boundaries of the Divisions and “is inward looking”, and that:
The words ‘shall be’ does not speak to some unknown future, but is an imperative. It dictates that there is to be a restructure along the lines set out there, ‘[s]ubject to any changes made by unanimous decision of the National Executive Committee following amalgamation’. Throughout the National Rules, the words ‘shall be’ are used to create presently existing rights, obligations and bodies, and on their own cannot be read as delaying the existence of such things until the occurrence of some future condition. A classic example of the use of ‘shall’ in this way is in rule 1 of the National Rules, which directs that ‘[t]he name of the Union shall be the ‘Construction, Forestry, Maritime, Mining and Energy Union’. The Divisions themselves, the existence of which is not in dispute, are created in Rule 27 with the same expression.
89 Accordingly, the respondents submit that r 42(iii) is not subject to a condition precedent that there be a restructure as a matter of interpretation.
90 The respondents submit that, in any event, the evidence demonstrates that a restructure from the former trade unions to a Divisional structure in fact took place, as follows:
Mr Smith accepted under cross-examination that the aim of this stage of the restructuring was ‘to transfer these unions with their individual backgrounds into the industries’ of construction, forest and forest products and mining and energy. The CFMMEU is undoubtedly divided into industry-based divisions. That it is so divided allows the Court to infer that any restructure contemplated by rule 42(iii) has in fact occurred.
Mr Edwards gave evidence that ‘[t]he divisions that the Amalgamating Unions created were the Mining and Energy Division (Mining Division), the Forestry and Forest, Building Products Manufacturing Division (Forestry Division), the Construction and General Division (Construction Division) and the FFTS Union Division (FFTS Division)’.
The fallacy of the argument is readily revealed by inquiring into the previous structure of the CFMMEU that was to be the subject of restructure. That previous structure was the historical union-based divisions of the kind referred to in rule 42(i). Undoubtedly, that structure no longer applies. There must have been, therefore, a restructure of the kind contemplated by rule 42(iii).
91 The respondents also submit that there are “contextual indications that point powerfully towards rule 42(iii) operating so as to allocate members between Divisions”, including these:
(1) There is conceivable overlap in the Divisions to which a person might be allocated, and a rule is necessary, therefore, to make the National Rules and divisional rules work coherently.
(2) There is no other rule in the National Rules that conceivably fulfils this function, so by deduction it falls to r 42(iii) to do so.
(3) Rule 7 of the National Rules (headed “Membership”) refers to, and picks up by cross- reference, r 42(iii). It does not refer to r 2, or any other rule as guidance for demarcating the boundaries between the Divisions.
(4) Rule 7(viii), which is a rule about disagreements between Divisions about the Division to which a member should be attached, allows for the National Executive (or a delegate) to determine the dispute, in accordance with “the principles established in and by sub-rules 42(i) and 42(iii) hereof”, which shows that r 42(iii) was considered to be one of the rules that supply the principles to be applied in determining where a member should be allocated within the Union.
92 As to purpose, the respondents submit that the text of r 42 “demonstrates that it is concerned with specifying the internal boundaries of the Divisions as between themselves” and “[t]hat is reinforced by rule 7”.
93 The respondents also submit that the applicant’s submissions about the pre-eminence that is to be accorded r 2, and the role that deleted r 42D has to play in interpreting the existing National Rules, should not be accepted for many of the same contextual indicators, namely:
(1) Rule 2 is about eligibility for membership of the CFMMEU as a whole, not the Divisions.
(2) Rule 2 is drafted to avoid any particular category being read down so as to avoid overlap (by the use of phrases like “[w]ithout limiting the generality of the foregoing and without being limited thereby the following are eligible to be members of the Union”), so that “it is very difficult, if not impossible, for any member to be able to determine with precision exactly which rule and only … which rule they fall within”.
(3) The operation of r 42(i) is temporally confined because it expressly operates only “[w]hile the FFTS Union Division continues its separate existence”.
(4) Rule 42(iii) then applies to determine the allocation of members between Divisions after the FFTS Union Division ceased its separate existence.
94 As to the applicant’s submission that r 42(iii) was “not implemented”, the respondents submit that the court should not accept an argument that results in redundancy of a whole paragraph of a rule in the National Rules, and that there is nothing in r 42(iii) to suggest that its operation is subject to any condition precedent, as the applicant’s submissions may be understood to contend.
95 Further, the respondents submit that “the history of rule 42(iii) stands positively against a finding that it was ‘not implemented’, or that it no longer has application with respect to members who would formerly have been eligible to join the FFTS” and that the amendments to r 42(iii) made between 1994 and 2003 confirm the effect and effectiveness of r 42(iii), because if r 42(iii) had never been implemented, there would have been no reason (repeatedly) to amend it.
96 The respondents say that the applicant’s reliance on deleted rr 42(iii)(d) and 42D “highlights the fundamental difficulty” with his case, because rr 42(iii)(d) and 42D “were two of the rules which, for a time, preserved the independence of the FFTS. Those rules were no longer of any effect, and were eventually deleted, after the absorption of the FFTS into the Manufacturing Division. By this point, the special status which had been accorded the FFTS under rule 42(i) had clearly lapsed”. The respondents’ written submissions continued as follows:
The respondents’ contention that rule 42(iii) now applies to the allocation of former members of the FFTS is reinforced by the introduction of rules 42(iii)(d) and 42D, and by their terms. The need for rules like these to preserve the independence of the FFTS illustrates the respondents’ point: in their absence, rule 42(iii) applies to determine demarcation. In that respect, the historic eligibility rule of the FFTS is in no different category to the eligibility rules of any other union now amalgamated into the CFMMEU.
Paragraph 14 of the Scheme of Amalgamation … contemplated that the FFTS would retain its autonomy for eight years. Paragraph 15 of the Scheme recorded the intention that the FFTS would, after this time, be integrated “substantially” into the Forestry, Forest and Building Manufacturing Products Division. This plan for the FFTS has been reflected, historically, in a number of provisions in rule 42.
What later became paragraph (d) of rule 42(iii) was originally an unnumbered clause at the foot of rule 42(iii). This paragraph specifically provided that the restructuring in rule 42(iii) would not affect the separate existence of the FFTS ‘for the time specified in the Transitional Rule’. The insertion of a specific clause at the foot of rule 42(iii) directed to preserving the status of the FFTS recognised that, but for such provision, the status of the FFTS would be affected by the restructuring produced by rule 42(iii). It also recognised that, as a general proposition, nothing further needed to be agreed for rule 42(iii) to take effect. Absent any further agreement, rule 42(iii) set out the default position.
The ‘time specified in the transition rule’ was eight years. It was specified by rule 42(xiii), which later became rule 42(xii). This rule was then referenced in rule 7(b)(v), which was inserted in August 1996. This ensures membership is not void or invalid by a member being in the wrong Division. The rule begins with the words: ‘without affecting or detracting from the requirements of sub-rules 42(iii) and 42(xii) ...’ The terms of this rule recognised that allocation to a Division would be determined by rule 42(iii). Rule 42(xii) only provided for a delay in the application of rule 42(iii) in the case of the FFTS. Rule 42(xii) was deleted in 2003, when the FFTS had lost its separate existence. The reference to rule 42(xii) in the current version of 7(v)(b) is now redundant. It is clear, however, that rule 7 refers to rule 42(iii) as governing disputes about the transfer of members between Divisions.
Rule 42(d) was also deleted in October 2003. At that point it was redundant, the FFTS having integrated into the Manufacturing Division on 11 February 2002. As with the deletions of other provisions which had functioned to preserve the separate existence of the FFTS, the effect of this deletion was to confirm that the other parts of rule 42(iii) then applied to govern the allocation within the union of former FFTS members.
(Emphasis in original.)
97 As for deleted r 42D, the respondents submitted as follows:
This rule was introduced in July 2002, and deals with administrative arrangements for the restructuring of the FFTS into the Manufacturing Division. The rule allowed for a Victorian Branch of the FFTS to exist within the Manufacturing Division up until 26 March 2005. It then provided (in paragraph 4) for a meeting, prior to this date, to be chaired by the National Secretary for the purposes of finalising translation/integration provisions “intended by the respective Schemes of Amalgamation and the Rules of the Union”. Importantly, paragraph 5 provided that, in default of agreement, the matter would be referred to the National Executive to be determined in accordance with “Schemes of Amalgamation and the Rules of the Union”.
The reference to the “Rules of the Union” in Rule 42D must be taken to be a reference to the rules governing the allocation of members between Divisions, as set down by rules 7 and 42. These rules are consistent with the Scheme of Amalgamation, which was also to be applied to any unresolved dispute under the terms of rule 42D. Presumably, Mr O’Connor’s case is that rule 2 would have applied to determine a dispute had one been referred. But this could not be the case, as the application of historic eligibility rules to a demarcation dispute is inconsistent with the industry divisions provided for in the Scheme of Arrangement.
The fact that no agreement was reached after rule 42D was enacted, and no determination was made by the National Executive, is not to the point. It is clear that rule 42(iii) would supply the basis for any such agreement or determination.
CONSIDERATION
98 The parties agreed about the applicable principles of construction, save for the relevance of the passage from the judgment of Barwick CJ in Cohen’s case, upon which Mr Borenstein relied (see [79] above).
99 The ordinary rules which govern the construction of written documents apply also to union rules, although the courts are accommodating of infelicities in drafting and strive to achieve a practical construction of them: see R v McKenzie; Ex parte Actors and Announcers Equity Association of Australia (1982) 148 CLR 573 at 576-577 (Gibbs CJ; Mason, Aickin and Wilson JJ agreeing); ResMed Ltd v Australian Manufacturing Workers’ Union (No 2) (2017) 249 FCR 408 at 413 [14] (Siopsis, Bromberg and Katzmann JJ).
100 The common understanding of the ordinary application of the words is relevant. In R v Williams; Ex parte Australian Building Construction Employees’ and Builders’ Labourers’ Federation (1982) 153 CLR 402 at 408, Gibbs CJ, Mason, Wilson, Brennan, Deane and Dawson JJ said:
The eligibility provisions in the rules of a registered organization of employees serve the function of defining the general area or areas of industry or industrial pursuit from which members can legitimately be drawn and with which the organization can legitimately be concerned. Since such eligibility provisions constitute a reference point for courts, commissions, employers, employees and other organizations in determining or ascertaining an organization’s proper coverage and field of operation, they must be construed objectively. In so construing them, however, it is permissible to pay regard to any common understanding among people concerned with relevant industries and particularly with industrial matters of the ordinary application of the words used and to take account of evidence of that common understanding furnished by the previous use of the words in the relevant organization’s rules and in statutory provisions, decisions, determinations, awards, reports and other papers concerned with the relevant industry or industries.
(Citations omitted.)
101 It may also be relevant to consider “the context in which an instrument is made, and which it is intended to address” and “the facts as they are known at the time the instrument is drafted”: see Transport Workers’ Union of Australia v Coles Supermarkets Australia Pty Ltd [2014] FCAFC 148; (2014) 245 IR 449 at 461 [46] (Siopis, Buchanan and Flick JJ), cited in the context of construing union rules in Finance Sector Union of Australia v Unimoni Pty Ltd [2019] FCA 1128 at [15].
102 As for the passage from Barwick CJ’s judgment in Cohen’s case, Mr Dowling said that it is not good authority for Mr Borenstein’s proposition that the task of construction should be carried out from the perspective of an imaginary prospective member because: (a) the Chief Justice was in dissent; and (b) although the passage is cited with approval in R v Williams; Ex parte Australian Building Construction Employees’ and Builders’ Labourers’ Federation (1982) 153 CLR 402 at 408 (extracted at [100] above), it is so cited only in support of the proposition that eligibility rules are to be construed objectively.
103 I agree. Other than the passage from Barwick CJ’s dissenting judgment, there is no authority to which I was taken which stands for the proposition that the task of construction should be carried out from the perspective of an imaginary prospective member. And such a notion is inconsistent with the long accepted proposition that the ordinary objective rules which govern the construction of written documents apply also to the construction of union rules: see, eg, R v McKenzie; Ex parte Actors and Announcers Equity Association of Australia (1982) 148 CLR 573 at 576 (Gibbs CJ; Mason, Aickin and Wilson JJ agreeing); R v Isaac; Ex parte Transport Workers’ Union (1985) 159 CLR 323 at 340 (Wilson J; Deane and Dawson JJ agreeing).
104 It cannot be gainsaid that various relevant parts of the National Rules contain infelicities of expression, and redundancies, of one sort or another. This is largely the product of the fact that the rules have been amended many times in a piece-meal fashion to accommodate union amalgamations and, at the same time, accord to the newly joined Divisions a significant degree of autonomy. That has resulted in rules that can, and in this case do, have their challenges.
105 In my view, however, for reasons which I will explain, the approach to the construction of the rules contended for on behalf of the respondents is to be preferred.
106 The approach contended for a behalf of the applicant, it seems to me with respect, has a number of difficulties.
107 The applicant’s case is that the relevant task of construing the National Rules starts with r 2, and then moves directly to r 2 of the Manufacturing Division Rules. That is, that having identified floor layers, glaziers and cabinet makers as being eligible to join the union under r 2, one goes directly to r 2 of the Manufacturing Division Rules and finds that such persons are eligible to be members of that Division and, as one also knows from the other divisional rules, no other Division.
108 The applicant says that there is no hierarchy of rules; that the Manufacturing Division Rules are to be construed accordingly; and that the process of ascertaining the true construction of the National Rules thus effectively ends with r 2 of the Manufacturing Division Rules.
109 It seems to me however that, construing the National Rules objectively, and reading them as a whole, one is bound also to have regard to r 7 and to r 42.
110 Rule 7 makes it clear that:
(1) a candidate for membership of the Union may make application to the National Secretary, to the Division covering the occupation or industry in which the person is or will be employed, or to the relevant Branch (r 7(i));
(2) a member shall be attached to the Division of the Union covering the industry or employment of the member and shall be in only one such Division (r 7(iv));
(3) any disagreement about which Division or Branch a member properly belongs to may be referred to the National Secretary and be determined by the National Executive or its delegate (r 7(viii)(b));
(4) any determination by the National Executive or its delegate “shall use the principles in and by sub-rules 42(i) and 42(iii) hereof” (r 7(viii)(d)); and
(5) nothing in r 7(viii) “shall affect or detract from the provisions of subrule(s) 42 (i), (iii) and (xii) and membership of a Division or a Divisional Branch shall be valid notwithstanding an irregularity in, breach of or failure to comply with the procedures in either one or both paragraphs (a) or (b) herein” (r 7 (viii)).
111 It follows, in my view, that it is necessary in construing the rules as a whole to have recourse to, and to construe, r 42 for the purposes of determining the appropriate Division or Branch to which a Union member belongs, just as the National Executive would be required to do if a disagreement about the appropriate allocation of a member were referred to it under r 7(viii)(b).
112 In that regard, a number of matters of context about r 42 are tolerably clear.
113 The Scheme for Amalgamation dated 3 November 1992 (referred to at [41] and [63] above) between the CFMEU the FFTS, the OPDU and VSBTU contemplated that:
(1) the new union-based Divisions (the Building Unions Division, the UMW Division, the ATAIU Division, the FEDFA Division and the FFTS Union Division) would be restructured into “Industry Divisions” (namely, Construction; Forestry, Forest and Building Manufacturing Products; Mining; and Energy Divisions) (cls 10, 14);
(2) the FFTS Union Division would have eight years in which to reach agreement on the way in which that restructuring would occur (cl 14);
(3) the FFTS Union Division would during that time “be autonomous in those matters that relate to members of that Division only” (cl 14); and that
(4) the FFTS Union Division was to be restructured after a maximum of eight years substantially into the Forestry, Forest and Building Manufacturing Products Division (cl 15).
114 Those matters are reflected in r 42 as amended at 26 March 1993. The March 1993 amendments altered r 42(i) so that it provided, among other things, that “on and from the date of amalgamation there shall be five (5) Divisions of the Union being the Building Unions Division, the ATAIU Division, the UMW Division, the FEDFA Division and the FFTS Union Division”. Further, r 42(iii) was amended to provide that the restructuring referred to in r 42(iii) “shall not affect the separate existence of the FFTS Union Division for the time specified in this Transitional Rule” (ie up to eight years).
115 Those same amendments also included amendments to r 42(xiii) so that it, among other things, provided that:
(1) the FFTS Union Division could have a separate existence for a period of up to eight years commencing on the date of effect of amalgamation of the FFTS and the CFMEU;
(2) if no agreement was reached by then, the National Executive would determine the changes necessary to effect the restructuring, including all rule changes; and
(3) it was then the current intention that the FFTS Union Division would be restructured after a maximum of eight years substantially into the Forestry, Forest and Building Manufacturing Products Division.
116 It is clear that the amalgamation referred to in the Scheme for Amalgamation has occurred; that the FFTS Union has now merged into the Manufacturing Division, so that it no longer continues its separate existence; and that the Union now comprises four Divisions, not five – namely, the Construction and General Division, the Manufacturing Division, the Mining and Energy Division and the Maritime Union of Australia Division: r 27(i). It is also tolerably clear that those Divisions are established principally “on a basis of industry”, as r 27(i) contemplates (“[t]here shall be Divisions of the Union … established on a basis of industry or occupation”), because each of the Divisions obviously describes an industry, not an occupation. (The Maritime Union is not mentioned in r 42. That may be because it amalgamated in 2018. In any event, “Maritime” obviously describes an industry.)
117 It must follow that “the demarcation between the FFTS Union Division and the other Divisions of the CFMEU”, being “the status quo” which r 42(i) says was to prevail “[w]hile the FFTS Union Division continues its separate existence”, cannot represent a statement of the current position, because the FFTS Union Division no longer continues its separate existence. Rule 42(i) thus no longer operates.
118 One next turns, as the National Executive would turn in the event of a divisional allocation dispute being referred to it, to the balance of r 42 invoked by r 7, namely r 42(iii).
119 Rule 42(iii) is headed “After Amalgamation”, which indicates that it is intended to have operation after the amalgamation of the FFTS Union Division (among others).
120 Rule 42(iii) contains an anachronistic description of the current Divisions of the Union. (The four current Divisions are correctly described in r 27(i) (see above at [116]).)
121 Rule 42(iii) instead refers to three Divisions: the Mining and Energy Division; the Forestry, Forest and Building Manufacturing Products Division (called the Forestry Division); and the Construction and General Division.
122 Eligibility for membership of the Mining and Energy Division and the Forestry Division is defined in both cases by reference to rr 2(A), (B), (C) and (E). Members falling within those categories of membership eligibility who are “employed in the Mining, Exploration and Energy Industries” are allocated to the former Division, and those in the “Forest and forest products industry, [p]ulp and paper industry, [and the] [t]imber and building related manufacturing industry” are allocated to the latter Division. Workers eligible to be members under r 2(D) are allocated wholly to the Mining and Energy Division.
123 The Construction and General Division, in turn, is to consist “of all members of the union employed in or in connection with the Construction industry (including shopfitting) and all other members of the Union not referred to [elsewhere in r 42(a)(iii)]”.
124 Rule 42 thus makes no mention of those members who are eligible to be members of the Union under r 2(F).
125 The applicant does not contend that r 42(iii) is to be construed on the basis that it contains a lacuna, or that a failure to include an express reference to r 2(F) in it was a mistake. Nor does he contend that r 42(i) provides relevant assistance, presumably because it is recognised that it is no longer capable of operation.
126 As the respondents submitted, the redundant provision in r 42(i) that “[t]he FFTS Union Division shall consist of all persons eligible … for membership … under Rule 2(F) including all former members of the previously registered FFTS” is a “problem” for the applicant because:
(1) that sentence “is the case that the applicant says continues in operation”; and
(2) “[he] can’t tell you that [his case] prevails by operation of [r 42(i)] because it must have ceased operation by reason of the [FFTS Union Division] ceasing its separate existence, and so they get there by what they say the work of rule 42D did …”
127 The respondents do not lay any claim to floor layers, cabinet makers and glaziers who work “off-site”, because they are not “employed in or in connection with the Construction industry” within the meaning of r 42(iii)(c). (Although the respondents adduced some evidence about the dichotomy between “on-site” and “off-site” workers, and their parallels “the construction industry” and the “manufacturing industry”, those distinctions received little attention in closing addresses.)
128 The effect of the respondents’ case is thus that r 42(iii)(c) is to be construed as meaning that all members of the Union not employed in or in connection with the construction industry who are eligible to be members of the Union under r 2(F) properly belong to the Manufacturing Division.
129 That is the approach to the construction of the National Rules which I favour. It is doubtless “generous”, because it involves reading words into r 42(iii)(c) that it does not contain. But the authorities say that in cases involving rules that are not drafted by skilled draftsmen and which contain internal inconsistencies and the like, a generous approach to the task of construction is permissible. As Wilson J observed in R v Isaac; Ex parte Transport Workers’ Union (1985) 159 CLR 323 at 340 (Deane and Dawson JJ agreeing):
In construing the eligibility clause in the constitution of an organization, it is necessary to bear in mind the nature of the instrument in which the words appear and the purposes that it is intended to serve. The rule now in question bears ample indication on its face that it has been prepared without the assistance of the skilled draftsman. It has been amended from time to time, probably in response to the exigencies attending the industrial affairs of the union and without regard to the effect of the amendment on the internal consistency of the clause as a whole. It follows that the words of the rule should be given a wide meaning and interpreted according to their ordinary or popular denotation rather than by reference to some narrow or formal construction. Nevertheless, notwithstanding this generosity of approach, the meaning of the words remains a legal question to be determined by the application of the ordinary rules which govern the construction of written documents.
(Citations omitted.)
130 The description of the rules of the Transport Workers’ Union in the second sentence of that passage, if I may say so with respect, is an apt description of the National Rules in this case.
131 One of the reasons that the applicant submits that one does not get to r 42 is that there is “no stated hierarchy” between the National Rules and the divisional rules, and nothing in the National Rules “derogates from the allocation which is explicitly set out” in r 2 of the Manufacturing Division Rules.
132 I am unable to accept that proposition. To say that divisional rules have the same hierarchical authority as national rules cannot, with great respect, be correct. The former are necessarily subordinate to the latter. As Mr Dowling said in his oral closing submissions, the divisional rules cannot determine divisional boundaries “because you would not be able to determine when another division is intruding on your rights without a tiebreaker or without a higher rule to determine … the contest”.
133 Justice Gray said something along the same lines in Callaghan v Federated Clerks Union of Australia (1987) 22 IR 346 at 367-368 (Callaghan’s case), as follows:
An organisation registered under the [Conciliation and Arbitration Act 1904 (Cth)] is a body corporate … The corporation is the owner of all its funds; they cannot belong separately to its branches. It must have an interest in the collection, preservation and proper application of those funds. Similarly, an organisation must have rules. To the extent to which it has separate rules for the operation of branches, those rules must inevitably be subordinate to the rules of the organisation itself, and some machinery must exist for ensuring that the rules of a branch are not, or do not become, inconsistent with the rules of the organisation itself. All of the general powers given by the rules of the union to its national council and national executive, including the powers to amend rules and to supervise the amendment of branch rules, are no more than one would expect within an organisation.
(Citations omitted, emphasis added.)
134 In this case, the “machinery … for ensuring that the rules of a branch [or Division] are not, or do not become, inconsistent with” the National Rules is provided by r 7 of the National Rules – which, in turn, invokes the “principles” contained in r 42(iii). In those circumstances, to accept that r 2 of the Manufacturing Division Rules governs the matter, as the applicant contends, would involve turning on its head what Gray J said in the passage quoted above from Callaghan’s case.
135 I am also unable to accept the applicant’s submission that r 42 is to be disregarded because it was “never implemented”, fully or otherwise. Quite apart from anything else, as the respondents submitted, r 7 (headed “Membership”) refers to, and picks up by cross-reference, r 42(iii) (not any provision of divisional rules), and directs the National Executive to r 42(iii) to resolve disputes about divisional allocation in accordance with the “principles established” by r 42(iii). It is true that the rules contain provisions that are redundant, as I have explained. There are obvious redundancies in r 42 in particular. The provision in rule 42(iii)(b) that “up until April 3rd, 2000 [it] shall be read subject to the agreement … dated September 2nd 1988” is clearly anachronistic, because it cannot by its own terms have any current operation. And the reference in r 42(iii)(c) to “sub-rule (iii) … (d)” is wrong because that sub-rule has been deleted.
136 But the applicant’s case, which amounts to saying that one must construe the cross-reference in r 7 to the principles established in r 42(iii) as referring to something that is wholly inoperative, seems to me to be a most improbable reading of the rules as a whole.
137 Likewise, acceptance of the applicant’s contention that r 42(iii) was not implemented would also result in giving the entire sub-rule, which on its face says that it operates (because it is effective “[a]fter amalgamation”), no work to do. That too is an improbable construction of the rules, and I do not accept it.
138 Further, there is also considerable force in the respondents’ submission that the amendments to r 42(iii) made between 1994 and 2003 confirm “the effect and effectiveness” of r 42(iii), because if it had never been implemented, there surely would have been no reason to have amended it multiple times.
139 I am also unable to accept the applicant’s submission that the 2003 deletion of r 42(iii)(d) from the rules (which had read “[p]rovided that the restructuring referred to above shall not affect the separate existence of the FFTS Union Division and untranslated FEDFA Divisional Branches for the time specified in this Transitional Rule”), was a merely “technical amendment consequent upon the abolition of the FEDFA division” and was not intended to work any changes to the allocation of ex-FFTS Division members at the time. That submission is, with respect, an assertion which is unsupported by any evidence. It seems to me that if one were to hazard a guess, the more likely possibility is that the section was deleted because it was recognised that it had no more work to do.
140 It follows that to the extent that Mr O’Connor and Mr Smith gave evidence that r 42 had never been implemented, I am unable to agree. In saying so, I make no criticism of them. I have no doubt that is a view that they genuinely held.
141 I also am unable to accept the applicant’s submission that r 42 was anything other than “self-executing”. As the respondents submitted, and I agree, when r 42(iii) says that “there shall be a restructuring of the Divisions” it “does not speak to some unknown future, but is an imperative. It dictates that there is to be a restructure along the lines set out there, “[s]ubject to any changes made by unanimous decision of the National Executive Committee following amalgamation”. The words “shall be”, in other words, “are used to create presently existing rights, obligations and bodies, and on their own cannot be read as delaying the existence of such things until the occurrence of some future condition” (see [88] above).
142 Next, I deal with the applicant’s submission about deleted r 42D. I have set out the submission above at [84], but it is as well to repeat the substance of it:
(1) r 42D did the job in 2002 of transferring or restructuring the FFTS Division into the Manufacturing Division;
(2) the position of ex-FFTS Division members was by October 2003 “enshrined in and protected by” rule 42D, such that the deletion of r 42(iii)(d) could not have any effect on them;
(3) by September 2005, the transitional arrangements under rr 42 and 42D applying to what had once been the FFTS came to an end “in a practical and a legal sense” and “the default position” under r 42D to give the coverage of the former FFTS Division to the Manufacturing Division “became fixed” because there had not been any contrary agreement;
(4) in the absence of any such agreement, r 42D “worked the result” that the Manufacturing Division took coverage of all of the former FFTS coverage; and
(5) it follows, so it is submitted, that from March or September 2005 the Manufacturing Division has had lawful and exclusive coverage of r 2(F) members.
143 I am unable to accept the applicant’s submissions about r 42D.
144 First, the submissions involve construing the extant rules by reference to a deleted rule. Counsel did not cite any authority regarding the use that may be made of deleted provisions when construing union rules, but in my view, as in cases involving the meaning of a contract, they are likely to be “an unsafe guide to meaning”: see Sir Kim Lewison and David Hughes, The Interpretation of Contracts in Australia (Thomson Reuters, 2012) at 3.04.
145 As Lloyd J said in Mineralimportexport v Eastern Mediterranean Maritime Ltd [1980] 2 Lloyd’s Rep 573 at 575:
I do not belong to the school of thought which regards it as inadmissible to look at deletions in a printed clause. Thus the use of a word or phrase in the deleted part of a clause may throw light on the meaning of the same word or phrase in what remains of the clause. But it seems to me quite another thing to say that the deletion itself has contractual significance; or that by deleting a provision in a contract the parties must be deemed to have agreed to converse. The parties may have had all sorts of reasons for deleting the provision; they may have thought it unnecessary; they may have thought it inconsistent with some other provision in the contract; it may even have been deleted by mistake.
(Citations omitted.)
146 Similarly, in Mopani Copper Mines plc v Millennium Underwriting Ltd [2008] EWHC 1331 (Comm); [2008] 2 All ER (Comm) 976 at 1003 [122]-[123], Clarke J said:
Even if recourse is had to the deleted words, care must be taken as to what inferences, if any, can properly be drawn from them. The parties may have deleted the words because they thought they added nothing to, or were inconsistent with, what was already contained in the document; or because the words that were left were the only common denominator of agreement, or for unfathomable reasons or by mistake. They may have had different ideas as to what the words meant and whether or not the words that remained achieved their respective purposes.
Further, as Morgan J pointed out in Berkeley Community Villages Ltd v Pullen [2007] EWHC 1330 (Ch) at [55], [2007] All ER (D) 36 (Jun) at [55]:
Even in the cases where the fact of deletion is admissible as an aid to interpretation, there is a great difference between a case where a self-contained provision is simply deleted and another case where the draft is amended and effectively re-cast. It is one thing to say that the deletion of a term which provides for ‘X’ is suggestive that the parties were agreeing on ‘not X’; it is altogether a different thing where the structure of the draft is changed so that one provision is replaced by another provision. Further, where the first provision contains a number of ingredients, some assisting one party and some assisting the other, and that provision is removed, it by no means follows that the parties intended to agree the converse of each of the ingredients in the earlier provision.
See also Health & Case Management Limited v The Physiotherapy Network Limited [2018] EWHC 869 (QB) at [72]ff; Ideal Business Centres Pty Ltd v Violin Holdings Pty Ltd atf The Violin Investment Trust [2018] NSWSC 1249 at [65]-[70].
147 Secondly, and in any event, there is no part of the text of deleted r 42D that invites any suggestion that the transitional arrangements became “fixed’ or “enshrined” absent any determination by the National Executive. On the contrary, r 42D(5) provided that “[s]hould agreement not be reached between the Divisions the matter shall be referred to the CFMEU National Executive to determine in accordance with the Schemes of Amalgamation and Rules of the Union”. Those “Rules of the Union” obviously included rr 7 and 42(iii), and it is those rules that at the relevant time (when r 42D was in force) would have provided the basis for the resolution of any internal demarcation dispute. The fact that the question was not determined by the National Executive is not, in my view, a fact that establishes, as the applicant would have it, that a “transitional” arrangement became fixed or enshrined, whatever those words may mean.
148 Thirdly, clear words would be required to make good the “fixed” or “enshrined” proposition because it would be an unlikely thing to have intended that the FFTS Division was to be treated differently to any other Division. Such an intention is even more unlikely when (on the applicant’s case) one must have reference to evidence of context, including minutes of meetings of the National Executive or the National Executive Committee dating back to 2002, and the text of a deleted rule, in order to divine it.
conclusion
149 In my view, for the reasons that I have given, the construction of the National Rules contended for by the respondents is to be preferred.
150 The proceeding will therefore be dismissed. Any party wishing to make any submission about costs will be directed to do so within 7 days.
I certify that the preceding one hundred and fifty (150) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice O'Callaghan. |
SCHEDULE OF PARTIES
VID 13 of 2020 | |
DEREK CHRISTOPHER | |
Fifth Respondent: | ROBERT GRAAUWMANS |
Sixth Respondent: | FRANK AKBARI |
Seventh Respondent: | STEVEN BALTA |
Eighth Respondent: | BILL BEATTIE |
Ninth Respondent: | GERARD BENSTEAD |
Tenth Respondent: | PETER BOOTH |
Eleventh Respondent: | RAYMOND BOOTH |
Twelfth Respondent: | MICK CODY |
Thirteenth Respondent: | ANTHONY CORDIER |
Fourteenth Respondent: | JOHN CONSTANTINOU |
Fifteenth Respondent: | FERGAL DOYLE |
Sixteenth Respondent: | DENNIS GRITZALIS |
Seventeenth Respondent: | KEVIN HARKINS |
Eighteenth Respondent: | RICHARD HASSETT |
Nineteenth Respondent: | ANTHONY IOANNIDIS |
Twentieth Respondent: | STEVE LONG |
Twenty-first Respondent: | DAVID LYTHGO |
Twenty-second Respondent: | DARKO MISIC |
Twenty-third Respondent: | JOHN PERAK |
Twenty-fourth Respondent: | JOHN PERKOVIC |
Twenty-fifth Respondent: | BRENDAN PITT |
Twenty-sixth Respondent: | RUDY RASPUDIC |
Twenty-seventh Respondent: | PAUL ROUND |
Twenty-eighth Respondent: | JAMES SIMPSON |
Twenty-ninth Respondent: | THEO TEHODOROU |
Thirtieth Respondent: | LISA ZANATTA |
