Federal Court of Australia

General Manager of the Fair Work Commission v Smyth [2024] FCA 304

ORDERS

THE COURT ORDERS THAT:

1.    The proceedings be dismissed.

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

REASONS FOR JUDGMENT

LOGAN J:

1    Mr Stephen Smyth is a trade unionist.

2    That is not a term of derision. From its inception, the federal industrial system has made legislative provision for the lawful existence of registered industrial organisations to represent, in that system, the industrial interests of groups of workers or, as the case may be, employers: see Pt V of the Conciliation and Arbitration Act 1904 (Cth) (Conciliation and Arbitration Act), as enacted.

3    Absent such legislative authorisation, a combination of workers undertaking or subscribing to organisational rules providing for the undertaking of industrial action in concert might, at common law, be regarded as an unlawful conspiracy in restraint of trade. Such legislative authorisation may be traced to the Trade Union Act 1871 (UK). Contemporary federal provision is found in the Fair Work (Registered Organisations) Act 2009 (Cth) (FWRO Act). I made reference to the origins of trade unions in Construction Forestry Mining and Energy Union v North Goonyella Coal Mine Pty Ltd [2013] FCA 1444, at [30] to [32]. It is neither necessary, nor even appropriate, in the circumstances of the present case to embark upon any assessment of the virtues and vices of trade unions and their manifestation in the form of registered industrial organisations, either in the federal industrial system or otherwise. It is, however, necessary to bear in mind that the context in which proscriptions in the FWRO Act concerning the conduct of officers and officials of registered industrial organisations fall for application is very different to the context in which analogous provisions found in the Corporations Act 2001 (Cth) fall for application.

4    Related to this, and for reasons set out below, it is also necessary to appreciate that, as is a matter of common knowledge in this State (s 144(1), Evidence Act 1995 (Cth) (Evidence Act)), the first Monday in May is Labour Day. Likewise, it is common knowledge that Labour Day is marked, traditionally on that day in May, as a public holiday to celebrate organised labour and recall its great historic achievement in the late 19th and early 20th centuries, the eight-hour working day. Understandably and genuinely, Labour Day has special significance for Mr Smyth.

5    One industrial organisation registered or taken to be registered under the FWRO Act is the Construction, Forestry, Maritime, Mining & Energy Union (the Union, which term embraces the pre-amalgamation predecessor).

6    Mr Smyth is, and was at all times material to this proceeding, the President of the Queensland District Branch (Branch) of the Union’s Mining & Energy Division (Division). Under its governing rules, the office of President is the most senior within the Branch. The Branch President is also, as Mr Smyth readily accepted in cross-examination, the “public face” of the Branch. That is not to say that the Branch President is responsible for the day-to-day administration of the Branch. As is not uncommon under the rules of registered industrial organisations, that role is undertaken by the Branch Secretary.

7    Although the Branch and, for that matter, the Division are not legal entities separate from the Union, each, on the evidence (which includes relevant Union rules), enjoys a considerable degree of autonomy in administrative, financial and operational affairs. While that makes it convenient at times to refer just to the Branch or, as the case may be, to the Division, it is important to read such references subject to the point just made about their absence of separate legal personality.

8    There was some brief evidence that Mr Smyth also held office in a separate, but not unrelated State registered industrial organisation: see Re McJannet; Ex parte Minister for Employment, Training and Industrial Relations (Qld) (1995) 184 CLR 620. Such separate registration was, and remains, essential for participation in some State industrial relations systems. However, one sequel to New South Wales v Commonwealth (2006) 229 CLR 1 (the Work Choices case), and, with it, the upholding of a much greater reach in Federal industrial regulation, has been a corresponding diminution in occasion for participation in State industrial relations systems by State registered industrial organisations, other than in respect of those employed by a State or an emanation thereof. Neither party to these proceedings considered it necessary to explore in any detail that separate office held by Mr Smyth in that separate organisation, or whatever might be their ramifications in law for the present proceedings.

9    Apart from the privilege of legislative authorisation of particular activities which might otherwise be unlawful, registered industrial organisations enjoy other privileges under federal law, notably the exemption of their ordinary and statutory income from income tax: s 50.1 and s 50.15, Income Tax Assessment Act 1997 (Cth).

10    With these privileges come particular responsibilities, both for registered organisations and those who hold office in them. As to the latter, these materially include, for an officer of an organisation such as Mr Smyth, duties of care and diligence (s 285, FWRO Act), an obligation of discharging duties in good faith and for a proper purpose (s 286, FWRO Act) and an obligation of not improperly using his or her position to gain an advantage for himself or herself or someone else; or cause detriment to the organisation or to another person (s 287, FWRO Act).

11    This case is concerned with whether the General Manager of the Fair Work Commission (General Manager) has proved that, as President of the Branch, Mr Smyth contravened, in ways which are detailed below, and in ways which it is alleged ought not be the subject of relief from liability (qv s 315, FWRO Act), ss 285, 286 and 287 of the FWRO Act. It was originally instituted by an official known as the Registered Organisations Commissioner (Commissioner). As a result of amendments made by the Fair Work Legislation Amendment (Secure Jobs, Better Pay) Act 2022 (Cth), that office ceased to exist, with the General Manager assuming, as successor, responsibility, on and from 6 March 2023, for the conduct of the proceeding as applicant.

12    It is for the General Manager to prove the alleged contraventions. Although the proceedings are civil in character such that the standard of proof is proof on the balance of probabilities (s 140(1), Evidence Act), contraventions may be attended with penal sanctions. Thus, a contravention is not so proved by inexact proofs or indirect references: s 140(2), Evidence Act; Briginshaw v Briginshaw (1938) 60 CLR 336.

13    In the event that any contravention is proved, it is for Mr Smyth to prove, again on the balance of probabilities, that he should be relieved from liability pursuant to s 315 of the FWRO Act: Deputy Commissioner of Taxation v Dick (2007) 242 ALR 152, at [78] per Santow JA; cited with approval by Middleton J in Australian Securities & Investments Commission v Healey (No 2) (2011) 196 FCR 430, at [86] and, in turn, as to the latter case, cited with approval by Murphy J in Australian Securities and Investments Commission v Australian Property Custodian Holdings Limited (Receivers and Managers appointed) (in liquidation) (Controllers appointed) (2014) 322 ALR 45, at [68] (ASIC v Australian Property Custodian). ASIC v Australian Property Custodian culminated at ultimate appellate level in Australian Securities and Investments Commission v Lewski (2018) 266 CLR 173 but nothing the High Court said in that case called into question the correctness of the conclusion as to onus reached in the original jurisdiction by Murphy J.

14    There is a further issue in the proceedings as to what validating effect, if any, s 320 of the FWRO Act had four years after the date of particular alleged contraventions. Given this issue, any conclusions I reach below concerning any of the alleged contraventions must be, and are, subject to whatever may be the effect of s 320 in the circumstances. Mr Smyth contends for a novel but, if accepted, pervasively ameliorating and absolving application of that section. Given this, it seems to me desirable that I first express conclusions with respect to whether, but for the contended application of that section, any contraventions would have been proved and, if so, whether any relief would have been granted under s 315 of the FWRO Act.

15    In light of the very nature of these proceedings and of certain evidence given in them, it is desirable to make some further, introductory observations. These observations are based on both the statutory functions consigned to the General Manager and, beforehand, to the Commissioner, on the purpose of a proceeding such as this and on listening to and observing Mr Smyth closely during the course of his oral evidence, which included a lengthy cross-examination.

16    Mr Smyth’s commitment to trade unionism and the benefits it can bring those in the mining industry in particular, especially with respect to workplace health and safety, was palpable, unfeigned and transparently sincere. In a sense, I rather thought this was in his blood. For he is a miner’s son and commenced his working life as a miner. Related to that, May Day, and his attendance as President at a Branch Lodge event to mark that day, was clearly meaningful and important to him. A Lodge is a local organisational sub-unit within the Branch. It will be necessary to return to the subject of his attendance later in these reasons when considering whether particular alleged contraventions of the FWRO Act by him are proved.

17    At one stage, Mr Smyth was asked whether he resented being subject to these proceedings. His affirmative answer was frank and likewise unfeigned. I certainly do not regard his answer as detrimental to his credibility. There is a deeply personal quality about the proceedings. I am quite sure that Mr Smyth considers that there is nothing untoward about the alleged conduct, at least because it was, as he saw it, in accordance with his understanding of “custom and practice” within the Branch. Further, the proceedings have doubtless had an opportunity cost for Mr Smyth in terms of his other responsibilities. I can also well understand, and indeed observed, the emotional, perhaps even physical, impact that respondency to the proceedings has had on him. However, I am well-satisfied, on the whole of the evidence, that there is nothing frivolous or vexatious about their institution by the Commissioner, or their continuance by the General Manager.

18    Further, although, as revealed below, I have reached some adverse conclusions concerning the General Manager’s case, I am also well-satisfied, again based on whole of the evidence, that it was brought in good faith by the Commissioner and likewise continued by the General Manager. A regulator such as the General Manager, and that official’s predecessor, the Commissioner, has a duty to perform the functions consigned to that office. These include promoting compliance with the financial reporting and accountability requirements of the FWRO Act: s 329A(1)(a)(ii).

19    One such means of promoting compliance is via the institution, where reasonable cause exists, of civil penalty proceedings. The purpose of a civil penalty regime, such as that found in the FWRO Act in respect of various duties for which that Act provides, is primarily, if not solely, the promotion of the public interest in compliance with the provisions of the Act by the deterrence of further contraventions of the Act: Australian Building and Construction Commissioner v Pattinson (2022) 274 CLR 450. Reasonable cause for the institution of proceedings is assessed in prospect. The finality which is at the heart of an exercise of judicial power can tend to suggest, after delivery of judgment, a certainty of outcome that often may never be present in prospect.

20    The expenditures which form the background to the alleged contraventions may conveniently be divided into a number of separate categories:

(a)    plumbing expense;

(b)    dental expense;

(c)    USA car hire expense;

(d)    Melbourne accommodation expense;

(e)    Melbourne dinner expense;

(f)    Mrs Smyth’s Melbourne airfare expense;

(g)    sundry other private expenses as detailed in Table A (Table A expenses).

21    Each of these, save for the cost of an airfare to Melbourne in respect of travel by his wife, was paid for via a union-issued credit card. That credit card was a Commonwealth Bank corporate credit card issued to Mr Smyth as President, at the direction of the Branch, pursuant to an account with that bank operated by the Branch. Over the period covered by the alleged contraventions, there were about 50 such credit cards on issue. The airfare cost was separately paid for by the Branch.

22    Both before and during the times when each of the credit card expenditures was incurred, the Branch had in place a policy in respect of the use of corporate credit cards issued to Branch officials, including Mr Smyth. That was termed the “CFMEU Mining & Energy Corporate Commonwealth Bank Credit Card – Policy Covering Use by Cardholders” (Policy). It is common ground that, on or about 16 May 2014, Mr Smyth signed a copy of the Policy.

23    It is not controversial that Mr Smyth did use the union-issued credit card to make each of the credit card expenditures alleged.

24    While the case concerns particular alleged contraventions of the FWRO, not of the Policy per se, the subject of whether particular expenditures were or were not in conformity with the Policy is material to the reaching of a conclusion as to whether Mr Smyth did engage in particular contravening conduct. Further, it was the Rules of the Union (Rules) and the Divisional Rules which authorised expenditure, with the Policy in turn specifying the circumstances in which such expenditure via a union-issued credit card could permissibly occur. It is uncontroversial that Mr Smyth was aware of the terms of the Policy with respect to union-issued credit card use. That is not to say that he was aware either that the Policy had the meaning for which the General Manager contends at the times when the expenditures were made or that the General Manager’s contended meaning is correct.

25    The Policy provided:

Union issued Credit Cards are normally only to be used for work related expenditure. Private usage of cards is only permitted in infrequent and exceptional circumstances and where personal expenditure is incurred in conjunction with Union related expenditure e.g. room service or mini bar tab included in a hotel bill. The personal expenditure component is to be deducted from a claim sheet or deducted from wages within the normal billing period for the Card. Personal use of the Corporate Card will be monitored by the District Secretary/District President and Office Manager and personal use may be restricted or stopped if overuse applies.

26    Flowing from a controversy between the parties as to its meaning, the nature and extent of the private usage of the credit card authorised by the Branch via this quoted extract from the Policy was controversial in the proceedings.

27    The General Manager submitted that the usual meaning of the word “and” is conjunctive, such that the elements in the authorised private expenditure category are cumulative. Consequentially, it was submitted that personal expenses were not permitted unless the circumstances were not only “infrequent” and “exceptional”, but also “incurred in conjunction with Union related expenditure”. This construction was said to be consistent with the content and purpose of the Policy: to facilitate work related expenditure via a union-issued credit card.

28    The General Manager put that Mr Smyth had accepted, in cross-examination, the construction for which the General Manager contended. However, in context, and based on my very particular recollection of the exchange in which this alleged acceptance occurred, it was nothing more than an acknowledgement by him of a literal wording of the Policy by a person whose demeanour and immediate qualification as to application left me in no doubt that he had never considered the Policy had the conjunctive quality for which the General Manager contended. On the evidence, that view was consistent with the general pattern of Mr Smyth’s behaviour in using the credit card issued to him.

29    Mr Smyth submitted that the Policy permitted a person to use a union-issued credit card for personal expenditure in two categories of circumstances: in infrequent and exceptional circumstances; or where it is incurred in conjunction with Union related expenditure.

30    The Policy did not come into existence in a vacuum; nor was it unlawful for the Union or the Branch to formulate a policy concerning expenditure incurred via union-issued credit cards. Rule 24A of the Rules (Exhibit 7) provides:

24A - POLICIES AND PROCEDURES - EXPENDITURE

(a)    The Union shall develop and implement internal control policies and procedures relating to the expenditure of the Union, to ensure that the Union is conducted in accordance with the principles of good governance and to ensure accountability to members of the Union.

(b)     Such policies and procedures shall be adopted by the National Executive and once adopted, shall be binding on all officers and members of the Union. Such policies and procedures must be identified in the resolutions of the National Executive as Rule 24A policies and procedures.

(c)    Rule 24A policies and procedures must be published on the website of the Union with fourteen (14) days of their adoption.

(d)    The provisions of sub-rules (a) to (c) herein shall apply, mutatis mutandis, to each Branch, Division and Divisional/District Branch of the Union.

31    In its mutatis mutandis application via paragraph (d), Rule 24A authorised the adoption of the Policy by the Branch. Neither party suggested to the contrary. The Branch is a “District Branch” (see Rule 27(vi)) for the purposes of Rule 24A.

32    Because each party accepted that the Policy was applicable in relation to Mr Smyth’s usage of the union-issued credit card, I shall not deal immediately with how that policy is to be reconciled with the terms of a “collective agreement”, which also had application to Mr Smyth. I shall consider that subject after detailing my conclusion about the construction of the Policy.

33    The correct approach to the construction of the rules of trade unions and of registered industrial organisations is the subject of authority. Although the Policy is not a union rule, that does not, in my view, mean that authorities concerning the approach to the construction of union rules are irrelevant to its construction.

34    As to that approach, in R v Aird; Ex parte Australian Workers’ Union (1973) 129 CLR 654, at 659, in detailing the approach to the construction of a union eligibility rule, Barwick CJ stated:

This is a legal question to be solved by legal considerations. But those considerations will, in relation to the present question, include any industrial meaning or usage of the words of the clause to be construed. As with all construction, the nature of the instrument in which the words appear and the purposes the instrument is evidently intended to serve or effect must be kept in mind. In this respect, it is proper, in my opinion, in the present case to acknowledge that the eligibility clause will have been drawn, more likely than not, by union officials more familiar with the practical affairs of industry than with the niceties or subtle nuances of language. The purpose of the clause is to define, in brief terms, industries or callings relevant to the representative character of the union. But, granted this generosity of approach, the question of the meaning of the words used remains a legal question.

35    Although that statement was made in the context of construing an eligibility rule, it is by no means confined in its application just to the construction of that type of rule. Rather, it encapsulates the general approach to the construction of union rules. Further, as can be seen from the passage quoted, and, with respect, unsurprisingly, while text, context and purpose are important, so, too, is an appreciation that the Policy, like a union rule, has, more likely than not, been drawn by a layperson familiar with the union and its objects, rules, operations in practice and role, which includes but is not confined to participation in the industrial relations system, its membership and the industries in which those members work, rather than by a legally trained draftsman.

36    A similar point was made by Lord Wilberforce in delivering the joint opinion of a unanimous House of Lords in Heatons Transport (St Helens) Limited v Transport General Workers Union [1973] AC 15, at 100 – 101 (Heatons Transport):

But trade union rule books are not drafted by parliamentary draftsmen. Courts of law must resist the temptation to construe them as if they were, for that is not how they would be understood by the members who are the parties to the agreement of which the terms, or some of them, are set out in the rule book, nor how they would be, and in fact were, understood by the experienced members of the court.

37    Lest it be thought otherwise, my citation of Heatons Transport does not carry with it acceptance that an additional observation there made (at 101) by Lord Wilberforce about the role of custom and practice in the governance of a union is necessarily applicable either in the general, Australian context of the rules of a registered industrial organisation, or in the construction of the Policy. His Lordship’s additional observation entailed quoting with approval, at [99], this passage from the United Kingdom’s Trade Union Congress Handbook on the Industrial Relations Act 1971 (UK):

Trade union government does not however rely solely on what is written down in the rule book. It also depends upon custom and practice, by procedures which have developed over the years and which, although well understood by those who operate them, are not formally set out in the rules. Custom and practice may operate either by modifying a union's rules as they operate in practice, or by compensating for the absence of formal rules. Furthermore, the procedures which custom and practice lays down very often vary from workplace to workplace within the same industry, and even within different branches of the same union.

In relation to the construction of the Policy, it is not necessary to have regard to custom and practice to fill a gap or to supply a particular meaning to a phrase or term. Nor, in my view, could custom and practice of itself authorise expenditure which was contrary either to a union rule or to a policy made under such a rule. However, custom and practice may well serve to explain why, for example, a particular expenditure should be regarded as falling within the “work related category” of expenditure permissible via a union-issued credit card.

38    What follows, in my view, is that, as with a union rule, where the text of the Policy admits of constructional choices, a construction which furthers, or is at least consistent with, any evident purpose of the authorising rule is to be preferred to one which is not.

39    Also to be preferred is a construction which is in conformity with wider context. Self-evidently, Rule 24A contemplates the formulation of policies that will promote the interest not just of the Union as an abstract, separate legal entity, or of a District Branch, but also of its members in financial integrity and good governance in relation to the expenditure of the Union’s funds. Further, the governance dimension necessarily means that the Policy must be construed in the context of how the Rules provide for the wider organisation and governance of the Union and implications necessarily flowing from such provision. That therefore includes not just the Rules but also, materially, the Divisional Rules. Regard to the wider context of the Rules and the Divisional Rules discloses that, although there is a national executive, the Union has a structure of Divisions, on broad occupational lines with scope for most Divisions to have Branches constituted on a geographic basis. The Divisional Rules evidence an application of this with respect to the Division.

40    It may be accepted that the word “and” often has a conjunctive quality. But sometimes it can carry a disjunctive meaning. The Policy has been made under a rule of a registered organisation, the day-to-day operations of which are conducted under the Rules and also Divisional Rules, which make provision for organisational sub-division into geographically delineated branches. Further, under the Rules and the Divisional Rules, one such branch of one such Division covers the mining industry in a State as large and decentralised as Queensland, with that branch being further sub-divided into local, geographically disparate groupings of members which the Divisional Rules term “Lodges”. Once these features are understood, it is inherently likely that a person holding office as, presently materially, President is going to have to travel. And to do so frequently, not exceptionally. An express duty of the President in the Divisional Rules is “as far as possible, observe that the Rules are carried out by the District Branch Lodges” (rule 9(ii)(a)). That duty is quite apart from what one might infer from the diverse objects of the Rules (clause 4) and the Fair Work Act 2009 (Cth) (FWA), with the latter’s emphasis on enterprise bargaining, as to a need for the President to be seen by and interact with members at Lodge and enterprise level. Discharging the duties of an office which is the “public face” of the Branch is consistent with a peripatetic, rather than a monastic, life.

41    Once the Policy is read in the context of the FWA, the Rules and the Divisional Rules, there is, with respect, a quality of unreality, if not absurdity, and certainly contextual incongruity about the construction of the Policy promoted by the General Manager.

42    The illustrative example in the Policy of the hotel bill (“room service or mini bar tab included in a hotel bill”), read in context, indicates that there are two authorised private expenditure categories. One such category is expenditure which is in “infrequent and exceptional circumstances”; and (deliberately to use that word in the same way as I consider it is used in the Policy) the other category is “where personal expenditure is incurred in conjunction with Union related expenditure”.

43    For reasons already given, it is inherently unlikely that hotel bills will be “infrequent and exceptional” for those holding union-issued credit cards, especially including, and presently materially, the President. Instead, it is inherently likely that such bills will be frequent and unexceptional and paid for via the use of the credit card. Once it is understood from context that there is an inherent likelihood of travel, the selection of the example is not coincidental but apt as one of two categories of private expenditure permitted to be incurred (subject to later refund) via the union-issued credit card. Recalling that the Policy is not the work of a parliamentary draftsman supports this construction.

44    The Policy also states, “Personal use of the Corporate Card will be monitored by the District Secretary/District President and Office Manager and personal use may be restricted or stopped if overuse applies.” (emphasis added). The notion of “overuse” in respect of personal expenditure as a touchstone sits awkwardly with a concession which permits such use where the expenditure must, as the General Manager contended, be both “infrequent and exceptional circumstances” and “where … incurred in conjunction with Union related expenditure”. On that construction, any personal expenditure which was not in “infrequent and exceptional circumstances” would be “overuse”. In contrast, the construction promoted by Mr Smyth gives this feature of the Policy work to do even in respect of personal expenditures within the letter of one or the other permitted category according to a senior Branch official value judgement based on the overall circumstances of the use of the union issued credit card.

45    Adopting the construction of the Policy promoted by Mr Smyth is not subversive of the fiscal integrity or good governance purpose of Rule 24A, or any other rule either in the Rules or in the Divisional Rules. It does not, as the General Manager’s submissions suggested, concede a large charter for private credit card expenditure, rather the reverse. The illustrative example in the Policy underscores just how intimately associated with a work-related expenditure must be the private expenditure in the second category for it to be authorised. In that category, there must be a logical, incidental association between the work-related expenditure and the private expenditure. Otherwise, the private expenditure must fall within the obvious stricture of being infrequent and exceptional, which needs no exemplification.

46    The Policy does not confine the use of a union-issued credit card to work related expenditure, as opposed to specifying that such expenditure is the usual way in which the card must be used. That is made clear by the adverb, “normally”. “Private usage”, which in context means the same as “personal expenditure component” in the Policy, is permitted in the two specified categories.

47    So construing the Policy does not contravene either the Rules or the Divisional Rules, which do permit the making of a loan to a union member in defined circumstances. Mr Smyth was, at all material times, a member of the Union. Indeed, he had to be a financial member to hold the office of President: see rule 8(i)(e) of the Queensland District Branch part of the Divisional Rules. Also, by that rule, he retained “full membership rights of the Lodges of which they were members at the time of their election to District Branch Office”. One such right was eligibility to receive a loan from the Union in accordance with the Rules and the Divisional Rules.

48    For these reasons, I reject the construction of the Policy promoted by the General Manager and uphold that promoted by Mr Smyth.

49    I now consider the effect, if any, of the “collective agreement” in relation to credit card usage and the incurring, via it, of private expenditure.

50    Throughout the period covered by the alleged contraventions, Mr Smyth, as President, was the holder of one of the fulltime, elected offices within the Union, as provided for by the Rules and, in turn, the Divisional Rules. Under the Divisional Rules, the President is a one of the “District Executive Officers” and thus a member of the “District Executive”: rule 8(i)(a), Divisional Rules. That same rule provides that the office of President is one of those which is fulltime. The Divisional Rules specify the term of office (4 years) of a member of the District Executive (rule 9(i)(b)). They also specify that the President will receive remuneration but do not specify the amount. Instead, the Divisional Rules state that the President “shall receive such remuneration as shall be agreed upon from time to time between the District President and the Board of Management”: rule 9(ii)(a). As a member of the District Executive, the President is one of those who constitutes the “Board of Management”: rule 8(i)(b), Divisional Rules.

51    On the evidence, there is an agreement of the kind contemplated by rule 9(ii)(a) of the Divisional Rules. The origins of that agreement in relation to Mr Smyth may be traced to a Board of Management resolution dated 5 December 2011, which directed the District Executive to, inter alia, “Finalise the officials contract of employment for approval at the March 2012 Board of Management” (sic). Also on the evidence, the “contract of employment” was not approved at the Board of Management meeting in March 2012 but rather in December 2012. On 11 December 2012, the District Secretary sent an email to various Branch officials, including Mr Smyth, which enclosed a copy of the “contract of employment as endorsed at the December 2012 Board of Management”. The document enclosed was entitled the “CFMEU Officials and Officers Collective Agreement” (“Agreement”). The reference to the “CFMEU” in the title is a reference to an acronym for the Union, prior to a later amalgamation. The Agreement was not an agreement registered under the FWA. However, its industrial relations system heritage is obvious enough both in its title and in its terms. In my view, it is to be construed guided by the same principles which attend the construction of union rules.

52    The Agreement applies both to officials and officers. The former are the holders of an elected office, the latter are employees of the Union undertaking duty within the Branch. As the holder of an elected office, Mr Smyth was an “Official” in terms of the Agreement.

53    As noted, in his covering email, the District Secretary described the Agreement as a “contract of employment”. There is a certain looseness of understanding in characterising the holder of a fulltime elected office as an employee but nothing turns on that in these proceedings. At the very least, the Agreement was, in relation to Mr Smyth and with respect to his remuneration as holder of the office of President, the agreement contemplated by the Divisional Rules. As to the other provisions in the Agreement insofar as they are applicable to Mr Smyth, it may perhaps be that the Agreement exemplifies a practice of the kind to which Lord Wilberforce referred in Heatons Transport. Alternatively, those other provisions might be policies authorised by Rule 24A of the Rules. It is not necessary further to explore this subject, because each of the parties accepted that the terms of the Agreement bound both the Union and Mr Smyth.

54    Apart from remuneration, the Agreement made provision for usual hours of work, various types of leave, superannuation, a motor vehicle, a laptop computer and other office equipment, duties of confidentiality and, presently notably, the following in relation to the provision of a Union credit card (clause 6.3) and an overnight allowance (clause 6.4). These clauses provided:

6.3    A Union corporate credit card will be provided by the District to each Official/Officer. The Official/Officer may charge all accommodation and associated expenses, incurred in discharging their duties as an Official/Officer, to a corporate credit card provided by the District or make arrangements for those expenses to be billed to the District. If the District provided corporate credit card is not used the Official/Officer must provide all receipts for the amounts they are claiming for reimbursement by the District. The Official/Officer shall not use a Union Corporate Credit Card for personal expenses not associated with their employment.

6.4    Officials/Officers are entitled to a $75.00 allowance upon completion and approval of the relevant claim form, in accordance with the District policy when, in connection with their duties, they are required to stay overnight away from their place of residence. This allowance will be reviewed at the December Board of Management each year and increased if deemed necessary.

[Emphasis added]

55    The Agreement also detailed, by clause 16, how Union or Branch policies applied to officials and officers covered by it. Clause 16 stated:

16.    Policies

16.1    Policies and procedures that are applied to, or are intended to apply to Officials and Officers within the scope of this Agreement, which confer a benefit or right on Officials and Officers will form part of the terms and conditions of Officials and Officers under this Agreement.

Policies falling within the category described above shall be available to Officials and Officers via accessible hard copy or electronic form.

The Union shall consult with Officials and Officers about the introduction of any new policy or procedure that significantly affects Officials or Officers within the scope of the Agreement in relation to their duties and obligations.

Where the Union seeks to significantly alter, detract from, or remove a benefit, right or entitlement applying to an Official or Officer under a Union policy or procedure, the Official, Officer or their nominated representative may elect to have the matter dealt with under the disputes resolution procedure under this Agreement.

56    As can be seen, clause 16 of the Agreement incorporates by reference particular policies and procedures. Authorising, as it does, particular private expenditure via a union-issued credit card, it entails no strain of language to regard the Policy as one which, in terms of clause 16, confers a benefit or right. So construing clause 16 then presents a constructional difficulty in that, in providing for the issue of a union credit card, the last sentence of clause 6.3 contains the restriction that it is not to be used “for personal expenses not associated with their employment”. That is, on any view, be it the construction promoted by the General Manager or that promoted by Mr Smyth, inconsistent with the private usage exception found in the Policy. Were there any controversy about the applicability of the Policy to Mr Smyth, and there is not, it would therefore be necessary to determine which restriction was paramount. Were it necessary to resolve the issue, the answer, in my view, would be supplied by recognising that the authority for the Policy is found in the Rules (Rule 24A). It, too, confers a benefit or right in terms of private use of a union-issued credit card. Clause 16 of the Agreement envisages that such a policy is incorporated by reference. The purpose of clause 16 of the Agreement is beneficial. Being more benign, the terms of the Policy about credit card use have paramountcy to the extent of any inconsistency.

57    The conclusion which I have reached concerning the correct construction of the Policy is not wholly destructive of the General Manager’s case, but it does mean that that case was, in part, instituted and conducted on a false premise. It remains necessary to detail how, if at all, that false premise affects particular alleged contraventions.

58    The present focus on the Agreement makes it apt to make these observations about the Branch administration of union-issued credit cards, clause 6.4 of the Agreement and the overnight allowance for which that clause provided. Doing that also requires some making some contextual findings of fact.

59    It is convenient first to consider clause 6.4 of the Agreement and the overnight allowance. There is a related policy in respect of this overnight allowance which was approved by the Branch’s Board of Management in December 2011. That policy states:

When official union business finishes which allows travel back to place of residence or work accommodation before dark then members are to travel back and not claim another night’s accommodation, overnight allowance, RDO or wage payment.

60    The General Manager’s emphasis in submissions that the clause 6.4 allowance is an overnight allowance, with related entitlement based on an overnight stay, not on arrival home after dark, is undoubtedly correct. This is made explicit by the emphasised words in the text of clause 6.4, as quoted above.

61    Mr Smyth was resident in Mackay throughout the period covered by the alleged contraventions. So was his wife. They still are resident there. That is where is their family home is located.

62    Mr Smyth’s duties as President often required that he attend at various mine sites or associated towns throughout Central Queensland (for example, Moranbah, Dysart, Collinsville, Middlemount, and Blackwater) and thus be away from Mackay. Sometimes this was for issues related to enterprise bargaining, sometimes it was for issues relating to mine safety (including accidents) and other workplace health and safety issues, sometimes it was for wider industrial relations or representational issues, sometimes it was for Union, Branch or local Lodge governance issues, sometimes it was for Union, Branch or local Lodge social events, sometimes it was for an important organised labour observance such as May Day and sometimes it was for a combination of one or more of these issues. These absences from home were quite apart from those occasioned by duties that took him to Brisbane or interstate for one or more of these issues, as well as Branch and wider Union governance and industrial relations and representational issues. There was a Branch office in Mackay. That was Mr Smyth’s base for his duties. He did undertake some duties there, as did other officials or officers based there. But the point is that neither Mr Smyth nor other officials or officers based in Mackay were desk bound.

63    Mr Smyth’s journeys to various locales in Central Queensland were undertaken by road via his driving the diesel engine, motor vehicle provided to him by the Union. On the evidence, these journeys often entailed an early morning start from Mackay. They also often entailed a late return to his home in Mackay, sometimes after dark, depending on the time of year, visited location and duties which he undertook at that location. Sometimes, they necessitated an overnight stay at a locale away from home.

64    Mr Smyth gave, in evidence, estimates based on his lengthy experience of typical start and finish times and length of road journey for various locations. I thought his estimates were reliable, especially when considered in conjunction with the numerous Credit Card Usage Forms (CCU forms) and related receipts which were in evidence. The CCU forms and receipts were admissible in themselves as business records. The receipts often gave not just the date, item and amount of purchase but also the locale of purchase. Suffice it to say, several hours of driving to and fro over the course of a day was routine for Mr Smyth when his duties took him away from Mackay into Central Queensland.

65    Risk of driving fatigue from such journeys aside, I consider it is a sufficiently notorious fact, a matter of common knowledge in Queensland, and therefore also a subject for judicial notice even without formal proof (s 144(1)(a), Evidence Act), that driving in the early morning and also into the late afternoon to and from Mackay and inland Central Queensland locales, as with other journeys to and from rural Queensland, presents other risks. Driving into a rising or setting sun aside, there is a risk of encountering and colliding with kangaroos, other wildlife, livestock and birds. There is a risk encountering carrion of the same on the road. There is also a risk of encountering the debris of burst truck tyres from road trains or other heavy vehicles.

66    I have already made some statements about Mr Smyth, based on my observations of him during his oral evidence. It was obvious to me, not just by what he said but also his demeanour, that he cares and always has cared, deeply and sincerely, about the representation of members of the Branch and, especially, their welfare and safety. He routinely assumed the risks mentioned in order to undertake his duties. Doing so meant that, also routinely, he did not work the standard hours specified in the Agreement. It was obvious from his evidence he did this willingly, and, by the time of trial, had done so for many years.

67    Mr Smyth’s practice was to return home to Mackay if it was possible to complete his duties at a Central Queensland locale over the course of a day. He did this even if this entailed several hours driving and even if this meant he did not reach home until after dark.

68    In part, this was for personal, family reasons. But I also accept his evidence that there was another reason.

69    Mr Smyth stated in his oral evidence that his understanding of the policy relating to overnight allowance was that it was to encourage members, for safety reasons, not to travel after dark. Based on my observation of Mr Smyth and viewing his evidence in context, I do not accept the General Manager’s submission that this was a recent invention. I accept he always had this understanding. He was also aware that an overnight stay away entailed an accommodation expense for the Union and, strictly, an entitlement to a rostered day off. “So that’s obviously a cost incurred.”, as he put it.

70    While in part his reasons were, as mentioned, familial, they were also, notwithstanding the risks described and his understanding of the policy purpose, occasioned by a disposition on Mr Smyth’s part not to burden Union, and in particular Branch, funds if he could avoid that in relation to these Central Queensland road trips away from Mackay. In context, that is what I took from his soon after answer, “I didn’t even cast my mind to it at the relevant time.” Notwithstanding his understanding about the purpose of the overnight allowance policy, he followed the practice of driving home even if that entailed arriving after dark, because he also did not wish to burden Union, and in particular Branch funds, by taking up the alternative of a remote, overnight stay if he could avoid that. This is why he did not cast his mind to the alternative.

71    There was evidence from Mr Smyth about whether a journey back to Mackay from a particular locale would, in the ordinary course, entail an arrival after dark at a particular time of year. The end to which this was directed was to demonstrate that, had Mr Smyth chosen to have followed a different course of conduct, there were divers occasions when he could have claimed an overnight allowance. However, that he did not do this is not exculpatory in respect of any of the alleged contraventions. On that subject, it is a distraction. It is not therefore necessary to consider it in any further detail. That stated, accepting, as I do, that one of the reasons Mr Smyth returned home to Mackay, even if that entailed a long journey (by road or, for non-Central Queensland duties, air) was so as not to burden the Union, and especially the Branch, with the expense of an overnight allowance and accommodation expenses, this evidence does offer an insight into his character. The evidence was not probative of an unclaimed entitlement to the clause 6.4 allowance.

72    Completion, by the union-issued credit card holder concerned, of a CCU form was part and parcel of the Branch requirements in relation to the holding of such a card. As well as specifying the circumstances in which such a card might permissibly be used for private expenditure, the Policy also stated:

•    All cardholders will be required to fill in a Corporate Card Usage Form. Details of each transaction are to be outlined on this claim form by the cardholder (supplies, nature of expenses, reason for expense), Corresponding invoices/receipts relating to each transaction are to be attached to this completed form and returned to the Qld District Office as soon as possible to be authorised by the District Secretary.

•    All cardholders are required to obtain a tax receipt/invoice for each payment transaction that is incurred. This tax receipt/invoice is to be used for the claim forms (outlined above). If a valid receipt is not obtained & submitted with the claim form, the payment amount of the particular transaction may, at the Administration Committee's discretion, be deducted from the cardholder's next wages in the case of Elected Officials & Staff. Cardholder’s at Lodge level who do not have a valid receipt will have the amount deducted from the Lodge Account with explanation sent to the Lodge Executive.

73    There were many CCU forms completed by Mr Smyth in evidence. The form makes provision for the identification of discrete expenditures, including the separate identification of any private expenditures. Mr Smyth completed these CCU forms in his own handwriting as soon as he could after the use of the card, which was usually upon returning to the Mackay office. Thereafter, either he or an administrative assistant in the Mackay office, Ms Olivia Morgan on his behalf, dispatched them via PDF attachment to an email to the Branch’s Brisbane office, along with related receipts. Sometimes, alternatively, Mr Smyth handed these documents in at the Branch’s Brisbane office if that was convenient when his duties took him there. These forms are thus a near-contemporaneous record by him, informed, I find, by a then fresh recollection of the credit card expenditures concerned. Taken in conjunction with related receipts in evidence, I consider that the completed CCU forms offer generally reliable evidence of Mr Smyth’s credit card expenditure and the private components of that expenditure.

74    An examination of the CCU forms in evidence discloses that Mr Smyth, again and again, identified expenditures incurred when using his union-issued credit card (and retained related receipts), including even the most modest of what he regarded, according to his understanding of the Policy, as private expenditures. The latter feature is most evident in respect of CCU forms which record expenditures during Mr Smyth’s road trips to and from various Central Queensland locales. Such trips provided the most frequent occasion for his use of the credit card and related completing or making entries in the CCU forms. Considered as a whole and in conjunction with related receipts, the CCU forms disclose, in my view, a man who was meticulous in seeking to meet the Policy reporting requirements, including by identifying private expenditure, informed by his understanding of what the Policy permitted in that regard. Likewise so considered, I find that the expenditures and related reporting are the work of an honest, although not perfect, man. I give detail in respect of each of these findings below.

75    A notable feature of Mr Smyth’s completed CCU forms and related receipts is the frequency and location of expenditure in the purchase of diesel fuel. Mr Smyth expanded in his oral evidence, honestly and accurately in my view, on the location of particular service stations where fuel purchases occurred. This consumption of diesel fuel is a marker for just how much driving Mr Smyth was undertaking in the course of performing his duties as President.

76    It was put on behalf of the General Manager that Mr Smyth’s evidence about his credit card expenditures was a reconstruction. I rather thought Mr Smyth acknowledged in his oral evidence that, at least in part, there was an element of this. It seemed to me that, many years after the event, and in respect of many expenditures which, at the time incurred, he had no reason to think he would ever have later have occasion further to detail (beyond the CCU form detail), he was, at trial, trying to do his honest best to provide that detail, prompted by the contemporaneous (or near) entries he had made on the CCU forms and related receipts. I also formed the distinct impression, based on the way in which his pleaded defence evolved, that he had probably given the most attention to the subject of exactly for what reason particular credit card expenditures had been incurred quite close to the trial. Of course such attention should have informed the defence as originally pleaded but considering the evolved pleadings and evidence as a whole, I do not conclude that Mr Smyth was, in his oral evidence, just making up explanations as he went along. That finding recorded, and unsurprisingly, the most reliable evidence as to expenditures and related reasons is, as I have stated already, as found in the contemporaneous or near contemporaneous documents such as the CCU forms and related receipts.

77    Although I accept the General Manager’s submission that, where Mr Smyth has, on a CCU form, recorded that particular expenditure was “private”, it is more likely than not that it was of this character, I do not do so in an unqualified way. For one thing, that is because it was “private” according to his understanding of the private union-issued credit card expenditures which the Policy authorised. For another, and as I detail below in relation to two expenses incurred on Labour Day 2015 and others incurred in hosting informal working meal meetings with others in which he participated, Mr Smyth chose to mark those expenses as “private” even though, in part, and correctly characterised, they were work-related.

78    As mentioned, the Branch has a Brisbane office. That is the principal office of the Branch. It is at that office that the District Secretary is located.

79    I have already made some reference to the duties of the President under the Divisional Rules. It is as well, at this point, to set out in full the formal provision in the Divisional Rules as to the respective duties of the President, a Vice President and the District Secretary. Within rule 9(ii) of the Divisional Rules it is provided:

(a)    The President

The President shall preside at all meetings of the District Branch Board of Management or meetings called by the District Branch. The President shall act in conjunction with the Vice-Presidents and Secretary in transacting the general business of the District Branch and, in the absence of the Secretary, shall attend to the correspondence of the District Branch. The President shall assist the Secretary in the preparation of annual reports and accounts and arrange with the Secretary for the attendance of either at important meetings of the Lodges. The President shall act as advocate for the District Branch and ensure that the rules are carried out in the Lodges. The President shall receive for her/his services such remuneration as shall be agreed upon from time to time between her/himself and the District Branch Board of Management.

(b)    The Executive Vice-President

The Executive Vice-President shall act in conjunction with the President and Secretary in transacting the general business of the District Branch. The Executive Vice-President shall, in the absence of the President, perform the duties of the President, and on instruction of the President, deputise for the President. S/he shall receive for her/his services such remuneration as shall be agreed upon from time to time between s/he and the District Branch Board of Management.

(c)    The Vice-Presidents

The Vice-Presidents shall act in conjunction with the President, Executive Vice-President and Secretary in transacting the general business of the District Branch. The Vice-Presidents shall, in the absence of the President, and Executive Vice-President perform the duties of the President, and an instruction of the President, deputise for the President. They shall receive for their services such remuneration as shall be agreed upon from time to time between themselves and the District Branch Board of Management.

(d)    The Secretary

The Secretary’s duties shall be to keep separate accounts of all monies received or paid on account of every particular fund and to keep separate accounts of the expenses of management and of all contributions on account thereof; and with the assistance of the President and Executive Vice- President, prepare a yearly Balance Sheet of the same, submit it to the first Board of Management Meeting after the end of the financial year and forward a copy to each Lodge. The Secretary shall attend, and take minutes of the proceedings of all District Branch Meetings. S/he shall, with the President and Executive Vice-President, zealously attend to all correspondence, watch the interests of the District Branch and do all in her/his power to advance the members' interests generally.

S/he shall arrange with the President for attendance of either at important meetings of the various Lodges, and also be empowered with the concurrence of the President to call special Board of Management Meetings in all cases of emergency. The Secretary shall be responsible to the Board of Management and shall receive such remuneration as shall be agreed upon from time to time between her/himself and the District Board of Management.

80    One sees in these rules the formal provision for division of administrative and representational duties. On the evidence, this was followed in practice. Thus, Mr Smyth’s acceptance of his being the “public face” of the Branch was a manifestation of the President’s role under the Divisional Rules “as advocate for the District Branch”.

81    One also sees in these rules formal manifestation of occasion for the President to attend at Lodges. The various Lodges are grouped in numbered Divisions for Board of Management electoral purposes (see rule 8(i)(c), Divisional Rules). As already highlighted, an incidental feature of the latter provision is the revelation it offers as to the spread and location of these Lodges and, with that, the potentiality, realised in practice on the evidence, for the frequent undertaking of travel by the President.

82    It is also patent from the rules concerning the duties of these officials that it is the District Secretary, rather than the President, who has the primary administrative and financial accounting responsibilities within the Branch, with the role of the President and a Vice President being to assist the District Secretary in this regard. This is consistent with Mr Smyth’s evidence that it is the District Secretary who has the day-to-day administrative responsibility for the Branch, in the nature of a chief executive officer.

83    Although the principal office of the Branch is in Brisbane, the Branch has other offices. These are located in regional Queensland. I have already mentioned the Mackay office, where Mr Smyth is based. There are others at Blackwater, Dalby, Dysart, Moranbah and Rockhampton (according to the annotation on the foot of the document which records the Policy).

84    In addition to the duties already mentioned, the Divisional Rules also made the following provision in respect of the duties of the President of a “District Branch”:

Rule 11(vi)(f):

“The Trustees shall have power:

(1)    To receive monies or other property paid, delivered or conveyed to them as Trustees of the District Branch and to expend monies without distinction between capital and income.

(2)    To invest, gift, donate sell, exchange or otherwise dispose of investments or other property of the District Branch and to deal with the funds of the District Branch including purchase or otherwise acquiring of property out of the funds of the District Branch.

(3)    To lend and advance money or give credit to any person or corporation; to guarantee, and give guarantees or indemnities for the payment of money or the performance of contracts or obligations by any person or corporation; to secure or undertake in any way the repayment of moneys lent or advance to or the liabilities incurred by any person or corporation: and otherwise to assist any person or corporation. …

(4)    To borrow or raise or secure the payment of money and to secure the same or the repayment or performance of any debt, liability, contract, guarantee or other engagement incurred or to be entered into by the District Branch in any way, and to purchase, redeem or pay off any such securities.”

By reason of rule 11(vi)(a) and (c), the President was a trustee for the purposes of this rule. The power to make loans (rule 11(iii)) will be noted.

85    One sees in the provision for trustees in the Divisional Rules a legacy from earlier eras of trade union law, well before provision by statute, be that Federal or State, for registered industrial organisations and related provision for registration to confer separate legal personality. In earlier eras, absence of separate legal personality in respect of a trade union usually resulted in provision under the rules of an unincorporated trade union for property to be held by trustees.

86    It is not uncommon in industrial jurisdiction cases concerning registered industrial organisations to encounter rules which were once apt but which have been uncritically retained in registered industrial organisations for many years, even though applicable legislation has been much changed and though union amalgamations may have yielded in a Division or Branch what was once a separate registered industrial organisation whose eligibility rules covered particular callings. In this way, the rules of modern industrial organisations can resemble a patchwork quilt of the rules of an earlier era, amended ad hoc to accommodate some newly introduced requirement or development but without a related, comprehensive review of the whole. However this may be, neither party delved in submissions as to whether rule 11 could continue to have any relevance in relation to a Branch which had no legal personality separate from the Union itself. Instead, it was assumed that it could have application with the controversy being whether and to what extent it was applicable to the credit card expenditures in question. The approach of the parties seemed to be that the rule should be regarded as governing how funds of the Union consigned under the Rules and the Divisional Rules to the control of the Branch might be expended. I have approached the determination of whether alleged contraventions are proved on that basis. Further, and as I detail below, other rules are relevant in relation to expenditure of Branch (or Union) funds and to the making of loans.

87    In the day-to-day administration of the Branch, the District Secretary is supported by employed administrative staff. On and from early 2015, one such person was Ms Nicole Maree Boucher. Ms Boucher was the other person who gave oral evidence at the trial. Ms Boucher was called as a witness by the General Manager.

88    Ms Boucher was and is a chartered accountant and certified practising accountant (CPA), and an experienced one at that. Ms Boucher’s association with the Branch began in 2013 when the chartered accounting firm, Vincents, was engaged on behalf of the Branch by a then newly elected District Secretary (Mr Tim White) to conduct a review of, and report and make recommendations concerning, credit card usage, policies and administration within the Branch. For this purpose, staff from Vincents were seconded to the Branch. Ms Boucher, who was then working for Vincents, was one such staff member. When, later, the employed position of Finance Manager within the Branch became available, she applied for this position. The position was publicly advertised. Ms Boucher was the successful applicant. She resigned from Vincents to take up the position of Finance Manager. She held that position until 20 December 2017.

89    The adoption of the Policy by the Branch appears to have been a sequel to the review conducted by Vincents.

90    Another employee at the Branch’s Brisbane office, during the time of Ms Boucher’s tenure as Finance Manager, was the Office Manager, Ms Amanda Ross. Others based in the Brisbane office at the time were Mr Tim White, as District Secretary, Mr Mitch Hughes, as District Vice President, Mr Greg Dalliston, as a district executive member, two in-house, employed lawyers and a legal secretary/assistant (Ms Charmaine Roth), two membership officers, an administration officer and, for a time, a receptionist.

91    I find that Ms Boucher gave honest evidence. In making that finding, I have expressly taken into account that Ms Boucher was the recipient of formal warning letters in 2017 concerning her standard of performance as Finance Manager, one of which was authored by Mr Smyth in his capacity as President. Looking at those warning letters in the context of the whole of the evidence as it related to Ms Boucher and her many duties, which extended well beyond monitoring and recording credit card usage in respect of the many cards on issue and any related loans in respect of any private expenditures on such cards, I formed the distinct impression not only that the duties consigned to Ms Boucher were more than might readily be undertaken by one person, but also that some of them were not ideal uses of a professionally qualified person’s time. As to the latter, I refer, for example, to travelling to and from the Brisbane office to various metropolitan Brisbane bank branches to undertake Branch banking (see the enclosure to the email of 14 December 2016 from Ms Ross to Mr Smyth, Mr Whyte and Mr Hughes in relation to Ms Boucher’s duties and performance). In fairness to the Branch, that seems, in time, to have been understood. It may also be, with respect, that Ms Boucher’s expectation, based on her prior role as an external consultant, as to the burdens of being Finance Manager, proved an underestimation in practice. In the email to which I have just referred, Ms Ross states:

Nicole made comments when she first started that this was a one person job even going to the point of saying it was a part time job. This statement was clearly not correct as she is struggling and cannot get to jobs in a timely manner needs assistance to get herself better organised.

92    It is also necessary to record that the Branch’s 2016 accounts were qualified by the auditor in relation to substantiation of union-issued credit expenditure overall. The Branch conducted an inquiry on the subject of such expenditure in 2017, to which I refer further below.

93    This is most certainly not a case about whether and to what extent, if at all, Ms Boucher did or did not satisfactorily perform her duties when Finance Manager. I have mentioned these matters to make overt that I have taken them into account in making my finding as to Ms Boucher’s honesty in giving her evidence. They are also relevant in relation to Mr Smyth’s acquittal of outstanding loan account balances from time to time and to whether amounts should have been posted to his loan account.

94    Upon her receipt, either by email or personal delivery, of completed CCU forms and related receipts, Ms Boucher’s practice was to endeavour, transaction by transaction, to reconcile these with relevant credit card statements, as provided to the Branch by the Commonwealth Bank. If insufficient information had been provided by the particular credit card holder in the CCU form to permit this reconciliation, it was Ms Boucher’s role to seek further information from that cardholder. It was likewise her duty to follow up a cardholder if, on checking transactions in a credit card statement, it became apparent that the cardholder had not submitted either or each of a related, completed CCU form and a related receipt. Sometimes therefore, this resulted in her revisiting her initial reconciliation. Ms Boucher also frankly accepted in her oral evidence that there were occasions, and not just in relation to credit card expenditures by Mr Smyth, when she forgot to undertake the reconciliation process described.

95    Ms Boucher confirmed, according to her understanding, what a reading of the Policy would suggest, which was that there was no fixed time within which a CCU form had to be completed and submitted by the cardholder to the Branch office in Brisbane. What the Policy also stated was, “The personal expenditure component is to be deducted from a claim sheet or deducted from wages within the normal billing period for the Card. Corresponding invoices/receipts relating to each transaction are to be attached to this completed form and returned to the Qld District Office as soon as possible to be authorised by the District Secretary.”

96    As became apparent from Ms Boucher’s evidence, there was a systemic difficulty in any compliance with this aspect of the Policy, either by the Branch or, materially, Mr Smyth. The Branch’s normal billing period in respect of the credit card facility with the Commonwealth Bank was monthly, closing towards the end of the month. The Branch had a standing arrangement with the Commonwealth Bank whereby, on the last day of a given normal billing period, the Branch’s then overall debit balance in respect of total issued credit card usage was cleared in full by the Bank via an automatic debit on an account maintained with that bank by the Branch. However, the Branch, and thus Ms Boucher, did not receive from the Bank the statements with respect to that month’s usage of the issued credit cards until some few days after the end of the billing period and thus when this clearing debit had occurred. Only then could any process of reconciliation between statement entries and declared private credit card usage by given individuals occur. Part of that process would entail reallocating particular debits to particular cardholders on the basis of declared private expenditure amounts. Further, the making of deductions from claims or, as the case may be, wages could only occur upon the receipt of CCU forms containing such declarations and the actioning of the entries on those forms.

97    There was no practice in place within the Branch whereby an extract from the credit card statement provided by the Commonwealth Bank to the Branch containing entries relevant to a particular individual’s union-issued credit card was provided to that individual. Mr Smyth’s evidence, which I accept and find accordingly, was that he was never provided with a copy of any credit card statement by the Branch and did not know what the closing date was in respect of a given month for the union-issued credit card.

98    Ms Boucher also described in evidence the practice followed within the Branch in relation to the claiming of the overnight allowance of $75.00. This allowance was claimed in arrears by those officials or officers eligible. The claim was made via a claim form separate from a CCU form. These overnight allowance claim forms were also lodged separately from CCU forms. In the ordinary course, payment was then made to the officer or official concerned in the pay period next following approval of the claim. A variation of that practice, where there existed a loan account as between the Branch and an official or officer, was to credit that person’s loan account with the amount of the overnight allowance. I describe that practice in greater detail below.

99    Some overnight allowance claims were made to, and paid by, the Division, rather than the Branch, if the occasion for the claim concerned union business at Division, rather than Branch, level. Mr Smyth’s overnight allowance claim form offers an example of what one might term a “hybrid” claim, in part claiming overnight allowance in respect of business at Division level, in part claiming overnight allowance in respect of Branch level business.

100    Antedating Ms Boucher’s employment by the Branch but continuing throughout it, there existed, as between the Branch and Mr Smyth, a loan account. The existence of such an account was approved by the Branch’s Board of Management. Such an account was not unique to Mr Smyth. The existence of such loans and then related indebtedness was declared in the formal accounts of the Branch. It was also recorded in a MYOB software-based accounting record maintained by the Branch in the Brisbane office. The MYOB accounting record also included a payroll record in respect of Branch officials, employed officers and other employees. The MYOB accounting record was a comprehensive record of the financial transactions of the Branch.

101    Files created by the Branch’s MYOB accounting record could be loaded into the account which the Branch maintained with the Commonwealth Bank. In this fashion, for example, the Bank received instructions as to how much to credit to Branch officials, employed officers and other employees in respect of weekly remuneration.

102    A statement of this loan account (Document C1.35), extracted from this MYOB record, was in evidence. Within the District Branch office, and again during the period of Ms Boucher’s employment, only two persons had access to that MYOB record, Ms Boucher and Ms Ross.

103    The loan account in respect of Mr Smyth was what one might term a running balance account. The precise terms of his and the other loan accounts were left to inference. Inferentially, the terms were such that union-issued credit card expenditures identified by Mr Smyth as private on the CCU forms he completed, according to his understanding of the Policy (or a disposition in any event to refund the amount of the expenditure to the Branch), and submitted were progressively debited to this loan account, via entries made by Ms Boucher. Again inferentially, the loan balance was repayable on demand. Further, even though there were, for reasons given already, practical impediments to the refunding of monthly credit card debits before the end of a statement closing period, there appears to have been an expectation, which one might term “custom and practice” that individual loan account debits would be repaid within a reasonable time. No interest was payable in respect of any debit balance from time to time. To achieve this repayment and pre-dating the start of Ms Boucher’s employment, Mr Smyth had in place an arrangement with the Branch whereby the sum of $100.00 was automatically debited from his weekly pay and credited to this loan account. This is confirmed by entries in the extracted record in evidence. Sometimes, too, Mr Smyth directed that a claimed allowance not be paid to him but rather credited to his loan account.

104    These regular, weekly credits from Mr Smyth’s weekly pay to his loan account ceased on 9 June 2015. That was not of Mr Smyth’s doing. In an email exchange with Ms Boucher on 10 February 2016 (Document C1.43) and having been provided with a copy of a MYOB produced statement of his then loan account position (probably, I find, Document C1.35), Mr Smyth queried Ms Boucher about a then debit balance of $427.66 and why there were no continuing $100.00 credits to his loan account balance shown on the statement.

105    It is inherently likely from this contemporaneous email exchange, and I find, that Mr Smyth had no idea before this exchange that his standing arrangement for the weekly crediting of his loan account by a debit from his pay had ceased. That is not to say that, had he had occasion to look, his monthly pay advice would not have alerted him to the cessation. But he had no occasion to look. This cessation was an internal process within the Brisbane office of the Branch. Given her then role and access to the MYOB based accounting package, it is more likely than not, and I find, that Ms Boucher implemented the cessation. With the passage of time, she was unable to offer an explanation in her evidence as to why this occurred. One effect of it, however, was that it resulted in the debit balance to Mr Smyth’s loan account, as at 10 February 2016, of $427.66, in contrast to his loan account being in credit at that point, had the regular credits from his weekly pay continued.

106    Apparent from an annotation in the financial accounts of the Union (Document C1.58) was that the Union, and thus the Branch, had in place, at all times material to this proceeding, the following policy in relation to loans to members, “The CFMEU mitigates credit risk on loans to members and associates by loaning small amounts only.” Ms Boucher, whose qualifications and experience made her competent to express an opinion on the subject, acknowledged in her evidence that such a policy in respect of loans to members was indeed consistent with accounting practice as to credit risk mitigation such that a lender might not need to take security for such loans:

And that might be a mitigation of credit risk because the amount is small, therefore, one might not need security, for example. That would be consistent with accounting practice; is that right?---Yes, that’s correct.

107    The approved, standing loan account arrangement which was in place as between the Branch and Mr Smyth, in conjunction with the arrangement between the Branch and the Commonwealth Bank in relation to monthly clearance in full of total credit card balances by the Branch, necessarily meant that, whatever the individual debit balance arising from Mr Smyth’s use (including private use) of his union-issued credit card was in a given month, it was cleared in full each month if need be, in relation to a debt flowing from Mr Smyth’s use of his union-issued credit card, by funds borrowed from the Branch by him. That was so even though he never got copies of related credit card statements or knew the precise monthly closing date for the union-issued credit card.

108    Once the requisite internal accounting was done by Ms Boucher as between the declared private components of Mr Smyth’s credit card debits and any credits flowing from any standing periodic credits to the Branch from Mr Smyth’s wages (when in place), credits flowing from overnight or other allowances credited to his loan account at Mr Smyth’s request and miscellaneous payments in by him, this yielded a net running balance on Mr Smyth’s approved loan account.

109    In this fashion, insofar as the Policy required clearance in full by each credit card closing date of a private usage component, Mr Smyth did this. Outside the presently immaterial realm of recoveries in consequence of insolvency, a debt paid in full via the use in whole or in part by a debtor of borrowed funds is just as much paid in full as it is if paid in full from the debtor’s savings or salary or wages or other cash flows. I am not at all sure that this proposition was understood by the General Manager (or, beforehand, by the Commissioner).

110    I turn then to consider individual transactions in respect of Mr Smyth’s use of his union-issued credit card.

The Plumbing Expense

111    On or about 7 August 2015, Mr Smyth used his union-issued credit card to pay $934.99 for a hot water service which was installed at his home in Mackay. On any view, this was private expenditure.

112    It is uncontroversial that this expense was not “work-related expenditure”. Further, it was not incurred “in conjunction with Union related expenditure”.

113    Given the conclusion which I have reached in respect of the construction of the Policy, this feature does not, in itself, mean that the expenditure via the credit card was not authorised.

114    The question becomes, can the expenditure be characterised as “infrequent and exceptional”?

115    Mr Smyth’s amended defence, filed on the third day of the trial, pleaded that “due to the effluxion of time, Mr Smyth cannot now recall the reason for his use of the Credit Card.” This accorded with an answer Mr Smyth gave to a question posed by me in the course of his oral evidence. The question concerned was prompted by a feeling I had, based on my observation of him in the witness box, that he was trying his honest best to recall why he had used the union-issued credit card (as opposed to some other card or other source of funds) to pay the plumbing account, not that there had not been some sort of emergency in relation to the home hot water system, such that he was under pressure to replace it forthwith.

116    There is no doubt the expense was related to plumbing. I do not accept the General Manager’s submission that Mr Smyth had made up the occasion for the incurring of the plumbing expense. It does not strike me as improbable that, even some seven years after the event, a person might well recall an event such as a dramatic breakdown of a home hot water system, especially if that coincided, as Mr Smyth related, with hosting a family visit. I find that was the occasion for the use of the credit card. Where I thought Mr Smyth was struggling with his recollection was why he had used the union-issued credit card to pay for the expense. There is no inconsistency between recalling the occasion for an unusual expense and not being able, years after the event, to recall why one had paid for that expense via a particular source of funds.

117    The answer may be, as Mr Smyth also related in evidence, “I was in a hurry, and I just had that card in my wallet and I used it.”. Accepting as I do that Mr Smyth’s recollection of the circumstances for the occasioning of the plumbing expense was accurate, I also accept that he was “in a hurry”. He also mentioned, and I accept, that he was under some pressure from his wife to get the hot water system fixed. These seem to me inherently likely corollaries to an unexpected failure of a hot water system during a family visit. I do not doubt that the failure of the hot water system did generate something of a domestic emergency and related pressure to remedy the situation promptly. It is more likely than not that the union-issued credit card was used by him deliberately, not inadvertently, in what may aptly be described as an emergency.

118    In evidence were bank and credit union statements in respect of cards on two personal accounts (a Queensland Country Credit Union card account in Mr Smyth’s name and a joint (with his wife) ANZ Access Advantage Account with Overdraft Facility (ANZ Joint Account) card). The balances in these accounts at the time of the plumbing expense demonstrated, and I find, that Mr Smyth had sufficient funds in these accounts to pay for the plumbing expense without recourse to the union-issued credit card.

119    There was no evidence that Mr Smyth’s Mackay home had some sort of ongoing problem with its hot water system. The General Manager has not proved that Mr Smyth’s use of his union-issued credit card, the alternative, permissible in conjunction with Union-related expenditure use aside, was frequent. That is so even if, as is more probably the correct approach, one measures frequency not by the nature of how often the particular type of expense is encountered but rather just by reference to the frequency of the various non-work-related usages of his union-issued credit card by Mr Smyth. Bearing in mind that the period covered by the alleged contraventions covered many monthly credit card usage statements, Mr Smyth’s usage of the card for private expenditures not in conjunction with Union-related expenditure use of the card was sparing. It was infrequent.

120    The General Manager has, however, proved that Mr Smyth’s use of his union-issued credit card was not “exceptional”. That is so even though, in my view, the better construction of the phrase “infrequent and exceptional” in the Policy is that it is a hendiadys. Thus, although the phrase probably is used to convey a single idea, the “exceptional” aspect of it is used to underscore that mere infrequency of use is not sufficient. Read in isolation, “exceptional” can mean special or out of the ordinary. In context, however, and as part of a composite in a Policy concerned with when a union-issued credit card may, in accordance with the Policy, permissibly be used in certain circumstances to incur a private expense that, at least in the first instance, will be debited to the funds of the Branch, what must be out of the ordinary is a need for such debiting to occur. Occasion for that use might well be found in an emergency situation, but part and parcel of that emergency must be that it carries with it a need for such debiting. Only then will the use be “exceptional”. Given that the General Manager has proved that Mr Smyth had, on the day, access to sufficient personal funds, it has been proved that there was no such need for Mr Smyth to use his union-issued credit card in relation to this plumbing expense.

121    Although the General Manager has proved that the plumbing expense was not exceptional and therefore outside the Policy, I am not satisfied that this usage evinced any dishonesty on Mr Smyth’s part. Mr Smyth’s prompt declaration of the plumbing expense as private expenditure is also consistent with his having an honest belief as to it being an authorised use. There can be no suggestion that he covered up this private usage.

122    I have already found that the use of the union-issued credit card occurred in the context of a domestic emergency. During his oral evidence, Mr Smyth stated, in response to his understanding as to the purpose for which his union-issued credit card might be used, “My understanding was it could be used in the event of emergency, in– in conjunction with work or in relation to other matters that related to your work.” I took this answer to embrace three situations, expenditure on union-related affairs, expenditure related to such expenditure and expenditure in any emergency. For reasons which I have given, the latter is not, in my view, an accurate description of the meaning of the permissible “infrequent and exceptional” private use category. But it is not hard to see how an honest layman might have the understanding voiced by Mr Smyth in evidence about that category.

123    It might be thought that Mr Smyth’s answer is inconsistent with an answer he gave with respect to his later use of the union-issued credit card to meet a dental expense encountered unexpectedly and in what might be thought of as emergency circumstances (as related below), where he described the use of the card as “inadvertent”. But that answer did nothing more than take up a contemporaneous written explanation he had given about the incurring of that dental expense via his union-issued credit card. Further, that answer, I thought, was defensive and given in the context of an assumed position, derived from the misconstruction of the Policy by the General Manager, that, to be authorised, private expenditure had to be both “infrequent and exceptional” and “incurred in conjunction with Union related expenditure”.

124    On balance, I consider the answer which Mr Smyth gave as to his understanding of the three circumstances in which he could use his union-issued credit card to be an honest reflection of the understanding which he had, and generally applied, during the period which is the subject of the alleged contraventions. However, as will be seen, there were departures by him from this general understanding.

125    The question now becomes whether, on the evidence, any or each of the contraventions alleged by the General Manager is made out in respect of the plumbing expense?

126    It is convenient to consider the relevant law, because conclusions reached as to the meaning and effect of the provisions allegedly contravened will also have application not just to the plumbing expense related alleged contraventions but also to the other contraventions alleged.

127    The General Manager alleges that Mr Smyth contravened either or each of ss 285(1), 286(1) and 287(1) of the FWRO Act in relation to the plumbing expense. More particularly, the General Manager alleges that, on or around 7 August 2015, in using his union-issued credit card to pay $934.99 in respect of this plumbing expense, Mr Smyth contravened:

(a)    s 285(1) of the FWRO Act by failing to exercise his powers and/or discharge his duties with a degree of care and diligence that a reasonable person would exercise if they were President of the District Branch;

(b)    s 286(1) of the FWRO Act by failing to exercise his powers and/or discharge his duties in good faith for what he believed to be in the best interests of the CFMEU and for a proper purpose;

(c)    s 287(1) of the FWRO Act by improperly using his position to gain an advantage for himself.

128    Materially, ss 285, 286 and 287 of the FWRO Act provide:

285    Care and diligence — civil obligation only

(1)    An officer of an organisation or a branch must exercise his or her powers and discharge his or her duties with the degree of care and diligence that a reasonable person would exercise if he or she:

(a)    were an officer of an organisation or a branch in the organisation’s circumstances; and

(b)    occupied the office held by, and had the same responsibilities within the organisation or a branch as, the officer.

…

286    Good faith — civil obligations

(1)    An officer of an organisation or a branch must exercise his or her powers and discharge his or her duties:

(a)    in good faith in what he or she believes to be the best interests of the organisation; and

(b)    for a proper purpose.

…

287    Use of position — civil obligations

(1)    An officer or employee of an organisation or a branch must not improperly use his or her position to:

(a)    gain an advantage for himself or herself or someone else; or

(b)    cause detriment to the organisation or to another person.

129    There is no necessary antipathy between conduct constituting a contravention of s 285 of the FWRO Act and conduct constituting a contravention of s 286 or s 287 of that Act.

130    In adopting the style of pleading found in the statement of claim, the General Manager appears to have been endeavouring to reduce its length. Nonetheless, the orthodox way in which either a contravention of statute sounding in a civil penalty or conduct constituting a criminal offence is pleaded is, in respect of each alleged contravention, to follow the wording of the statutory provision concerned, giving such factual particulars as are needed to detail the date and conduct of the alleged contravenor or offender giving rise to the alleged contravention or offence.

131    As it is, having regard to the language employed in the pleading, it appears that a contravention of each of ss 285, 286 and 287 of the FWRO is alleged to be found in the following:

(a)    used funds of the District Branch for personal purposes;

(b)    caused District Branch funds to be used for purposes not associated with his employment or in furtherance of the objects of the District Branch referred to in rule 3 of the District Branch Rules;

(c)    obtained a personal benefit for himself and/or Mrs Smyth at the expense of the District Branch;

(d)    failed to avoid conflict between the interests of the District Branch and the interests of himself and/or Mrs Smyth;

(e)    failed to maintain a separation between transactions for which he might properly use the funds of the District Branch and those which he ought to have funded otherwise;

(f)    obtained an unauthorised benefit from his role as President of the District Branch;

(g)    failed to take adequate steps to ensure that the Smyth Loan was accurately recorded in the Smyth Loan Accounts;

(h)    acted in a way that was unauthorised under the Credit Card Policy and/or breached his obligations under the Credit Card Policy, set out in paragraphs 6(a) and/or 6(b);

(i)    caused the District Branch to maintain and record the Smyth Loan Accounts;

(j)    received the benefit of a credit facility for his personal benefit without incurring interest and/or requiring security.

132    It was not put that there was any resultant embarrassment to Mr Smyth flowing from the General Manager’s pleading. However, the difficulties presented by the way the case has been pleaded have become more apparent on close consideration of the evidence and what is said to constitute particular contraventions. As revealed by the pleaded list of factors said to demonstrate a contravention, the General Manager’s case, even in relation to s 285 of the FWRO Act, is nuanced. It is more than just an allegation that a particular expenditure via the union-issued credit card fell outside a permitted category of expenditure and by that very fact amounted to a failure by Mr Smyth, in the ways particularised, to exercise powers and discharge duties with the degree of care and diligence that a reasonable person would exercise.

133    It is uncontroversial that, as President of the Branch, Mr Smyth was, for the purposes of each of ss 285, 286 and 287 of the FWRO Act, an “officer of an organisation”. The reference in these sections to “organisation” is to a registered industrial organisation. The Union was such an organisation. Mr Smyth held office within that organisation.

134    The provenance of s 285 of the FWRO Act is to be found in corporations law. One evident purpose of the FWRO Act is to impose upon, materially, officers of organisations like duties to those imposed under corporations law on directors of corporations. However, as already observed, the context in which those duties fall to be considered in relation to officers of an organisation is in respect of organisations which have different objects than the carrying on of business with a view to profit.

135    In Chew v The Queen (1992) 173 CLR 626 at 642, Dawson J, in referring to the analogous s 229(2) of the Companies (West Australia) Code, stated:

The offence created.by s. 229(2) – failing to exercise a reasonable degree of care and diligence in the exercise of an officer's powers and the discharge of his duties - does not seem to import a mental element, the test being limited to what may reasonably be expected of a director in the circumstances.

In support of his conclusion, Dawson J cited Byrne v Baker [1964] VR 443 (Byrne v Baker), at 450. Regard to that case discloses that, while it is the immediate source of Dawson J’s conception of the test as “limited to what may reasonably be expected of a director in the circumstances”, the ultimate source of that understanding is to be found in like observations made by Romer J in Re City Equitable Fire Insurance Co [1925] 1 Ch. 407 (Re City Equitable Fire Insurance Co), in the course of determining a misfeasance summons in a winding up case.

136    A conclusion that the offence created by s 229(2) carried no mental element was supported by context, as, by way of contrast, the then s 229(1) of the Companies (West Australia) Code expressly imposed an obligation on an officer of a corporation to act honestly. There is no like context in the FWRO Act in relation to s 285. Even so, the text of that provision – “that a reasonable person would exercise” – is itself indicative that the test is an objective one, devoid of a need for the proof either of dishonesty or any other mental element. In General Manager of the Fair Work Commission v McGiveron [2017] FCA 405 (GMFWC v McGiveron), at [16], Barker J, having noted that s 285 of the FWRO Act is in like terms to s 180 of the Corporations Act, followed a course of corporations law authority concerning the interpretation of that kindred provision so as to hold that the test posed by s 285 is an objective one.

137    Barker J took a like view of the meaning of s 285 in Registered Organisations Commissioner v Australian Nursing and Midwifery Federation [2018] FCA 1735 (ROC v ANMF). More particularly, in that case, his Honour cited with approval as applicable to s 285 of the FWRO, these observations concerning s 180 of the Corporations Act made by French CJ, Gummow, Hayne, Crennan, Kiefel and Bell JJ in their joint judgment in Shafron v Australian Securities and Investments Commission (2012) 247 CLR 465, at [18] (Shafron):

The degree of care and diligence that is required by s 180(1) is fixed as an objective standard identified by reference to two relevant elements – the element identified in para (a): ‘the corporation’s circumstances’, and the element identified in para (b): the office and the responsibilities within the corporation that the officer in question occupied and had. No doubt, those responsibilities include any responsibility that is imposed on the officer by the applicable corporations legislation. But the responsibilities referred to in s 180(1) are not confined to statutory responsibilities; they include whatever responsibilities the officer concerned had within the corporation, regardless of how or why those responsibilities came to be imposed on that officer.

[emphasis in original]

138    To observe of the judgments of Barker J in GMFWC v McGiveron and ROC v ANMF that I should follow them because I am not persuaded that they are clearly wrong would visit a discourtesy on the reasoning of his Honour. The analogy with corporations law is a strong one, indeed one intended by parliament. That analogy makes the “objective standard” statement concerning s 180 of the Corporations Act in Shafron a compelling one with respect to s 285 of the FWRO Act, as does the text of the provision itself. I respectfully share his Honour’s understanding of the meaning of the provision.

139    I would add, given the corporations law provenance of s 285, that it is as well to recall these observations made by the Full Court in Byrne v Baker, inspired by what Romer J had earlier stated in Re City Equitable Fire Insurance Co concerning the duties of directors:

It is clear from what Romer, J., said that his conception of the diligence required of a director was something quite different from the diligence of a man who might aptly he described as a diligent person in the sense that he could always be relied upon to give close attention to all business affairs in his hands. For Romer, J., the test of an honest director's liability was whether or not it could be said of him that he had been negligent, that is to say that he had failed to exercise due skill and diligence as it was reasonable to expect of him in the circumstances.

Recalling that the text of s 285 employs “care and diligence”, one might, in my view, aptly adapt the expectation voiced by Romer J almost a century ago to be, in the context of s 285 of the FWRO Act, that the care and diligence required of an official of an organisation is something quite different from the diligence of a man who might aptly be described as a diligent person in the sense that he could always be relied upon to give close attention to all organisational affairs in his hands; rather the test of an honest official's liability is whether or not it could be said of him that he had been negligent, that is to say that he had failed to exercise due care and diligence as it was reasonable to expect of him in the circumstances.

140    As an analysis of the analogous corporations law provision offered in Australian Securities and Investments Commission v Cassimatis (No 8) (2016) 336 ALR 209 (Cassimatis), at [486] – [487] by Edelman J, when a judge of this Court, instructs, insofar as a determination of whether an officer of an organisation or a branch thereof has exercised a reasonable degree of care and diligence may also entail “balancing” a risk of harm in particular conduct against the potential benefits that could reasonably have been expected to accrue to the organisation or branch, that must be understood as “balancing” in the sense described by Mason J in Wyong Shire Council v Shirt (1980) 146 CLR 40. In that case, Mason J (as his Honour then was), at 47 – 48, stated:

[T]he tribunal of fact must first ask itself whether a reasonable man in the defendant's position would have foreseen that his conduct involved a risk of injury to the plaintiff or to a class of persons including the plaintiff. If the answer be in the affirmative, it is then for the tribunal of fact to determine what a reasonable man would do by way of response to the risk. The perception of the reasonable man’s response calls for a consideration of the magnitude of the risk and the degree of the probability of its occurrence, along with the expense, difficulty and inconvenience of taking alleviating action and any other conflicting responsibilities which the defendant may have. It is only when these matters are balanced out that the tribunal of fact can confidently assert what is the standard of response to be ascribed to the reasonable man placed in the defendant’s position.

The considerations to which I have referred indicate that a risk of injury which is remote in the sense that it is extremely unlikely to occur may nevertheless constitute a foreseeable risk. A risk which is not far-fetched or fanciful is real and therefore foreseeable. But, as we have seen, the existence of a foreseeable risk of injury does not in itself dispose of the question of breach of duty. The magnitude of the risk and its degree of probability remain to be considered with other relevant factors.

141    Also flowing from the text of s 285 of the FWRO Act, the test posed is not just objective but multi-factorial. It looks to an officer “in the organisation’s circumstances”, the office occupied by that officer and to the responsibilities within the organisation or a branch of that officer.

142    The office of President of the Branch is not one required under the Rules to be held by a person with particular experience, let alone with qualifications in law or commerce. It must be held by a member of the Union. Further, given the coverage of the Division within which the Branch is found, it is inherently likely that the member concerned will have a background of experience as a miner or in a mining industry related calling.

143    When the statutory prism for the objective determination of reasonable diligence is applied to the office held by Mr Smyth, a way of illustrating why an application of the authorities about reasonable diligence is difficult is by considering what is entailed when a single union-issued credit card expense has a work related component and a private, but Union-related, component (as, for example, with the USA Car Hire Expense, detailed below). If such a hybrid expense had been incurred personally in the course of gaining or producing assessable income, and claimed in Australia as a tax deduction, then, to a person schooled and experienced in the principles and related case law concerning the meaning and effect of s 8-1 of the Income Tax Assessment Act 1936 (Cth), it might readily be concluded that the expense was one which could not be claimed in full but instead had to be apportioned to remove from the claimed deduction the portion attributable to private purposes. Even then, expenses which had to be incurred in any event in the course of gaining or producing assessable income might not have to be apportioned. An apportionment need can seem trite to a person so schooled and experienced. But this type of expertise is not the statutory prism posited for the objective test found in s 285. It is important that those charged with determining whether that section has been contravened do not subconsciously deploy whatever personal expertise they may have under the guise of determining what is or is not reasonable or negligent. Further, as already mentioned, s 285 of the FWRO Act does not mandate perfection, only reasonable diligence.

144    Yet further, the precision of the test posited by reasonable diligence s 285 may be more superficial than real.

145    A way of illustrating this point is by analogy with the modern law of negligence, now ever increasingly governed by statutory provision rather than the common law. For example, a reasonableness test has been inserted into the Civil Liability Act 2002 (NSW) (Civil Liability Act). Section 5B(1) of that Act provides that “[a] person is not negligent in failing to take precautions against a risk of harm unless: (a) the risk was foreseeable (that is, it is a risk of which the person knew or ought to have known), and (b) the risk was not insignificant, and (c) in the circumstances, a reasonable person in the person’s position would have taken those precautions” (emphasis added). A comparison between the words emphasised in this subsection and s 285 of the FWRO discloses a similarity between respective statutory touchstones. Section 5B(2) of that Act provides that “[i]n determining whether a reasonable person would have taken precautions against a risk of harm, the court is to consider the following (amongst other relevant things): (a) the probability that the harm would occur if care were not taken, (b) the likely seriousness of the harm, (c) the burden of taking precautions to avoid the risk of harm, (d) the social utility of the activity that creates the risk of harm”.

146    As with s 285 of the FWRO Act, there is an apparent, objective precision in the statutory test in the Civil Liability Act. However, the differing views from original to ultimate appellate jurisdictions in Tapp v Australian Bushmen’s Campdraft & Rodeo Association Ltd (2022) 273 CLR 454 (Tapp) about whether, on the evidence, that objective standard was transgressed demonstrate that, in practice, certainty of outcome in the application of such an objective test to given facts can be elusive. The circumstances of that case concerned a rider who was badly injured in an open campdrafting event organised by a sporting association, after she fell from her horse. She fell when her horse slipped on the ground of the arena. The event organisers were warned, as the condition of the ground in the arena became progressively worse during the event as a result of a combination of inclement weather and related churning of the ground, that it should be cancelled. The injured rider sued the event organisers for damages for breach of the statutory duty. Ultimately, a majority in the High Court concluded that the statutory duty was breached, but there were sharply differing views both in that court and in the lower courts arising from what should or should not be regarded as “reasonable” in light of the inherently dangerous nature of campdrafting as a sport.

147    Like in the present case with s 285 of the FWRO Act, the test imposed by statute in Tapp was nominally objective. Each, however, is evaluative, according to the facts of a given case and there may be scope for reasonable minds reasonably to differ about whether the objective standard is transgressed. In this sense, the statutory test differs from determining, on judicial review, whether an administrative decision made on particular facts is, or is not, legally unreasonable. In relation to whether that jurisdictional error ground is made out, there is no “latitude of choice”: Minister for Immigration and Border Protection v SZVFW (2018) 264 CLR 541, at [55] per Gageler J (as his Honour then was).

148    Such considerations are especially pertinent in this case.

149    As to the organisation’s circumstances, the General Manager put that the Union, of which the Branch forms part, was “a large, asset-rich, and well-resourced corporation”, such that its senior officers, in particular Mr Smyth as the President of a Branch, “should be compared to those in major Australian corporations”. For the former proposition, the General Manager cited an observation by Collier J to this effect concerning the Union in Australian Building and Construction Commissioner v Ingham (The 180 Brisbane Construction Case) (No 2) [2021] FCA 263, at [38]. However, and with respect, an observation by a judge in another case, presumably based on the evidence in that case, is not evidence in the present case.

150    What I do have in evidence are the Branch’s audited financial statements for the year ended 30 June 2016, as lodged pursuant to the FWRO Act. These financial statements also offer evidence of the financial position of the Branch in the preceding financial year, by virtue of the inclusion of the previous year comparatives. Thus, they offer a good insight into the financial position of the Branch over most of the period covered by the alleged contraventions. Whatever might be the position of the Union as a whole, the financial statements of the Branch do not disclose that, considered as a semi-autonomous operating unit within the Union, the Branch was “large and asset rich”. In the circumstances of the present case, the financial position of the Branch is, in my view, the apt organisational prism through which to view Mr Smyth’s conduct for the purposes of s 285 of the FWRO Act.

151    In the 2016 year, the Branch made a loss of $2,777,980, as compared with a loss of $384,708 in the preceding financial year. The financial statements also disclose a change in net assets from $15,097,055 as at 30 June 2015 to $12,319,075 as at 30 June 2016. The financial statements also disclose that the bulk of the Branch’s income came from membership fees and levies. Another major source of financial assistance for the Branch came from the Union’s national office. As to expenditure, the financial statements disclose that Branch expenditure on wages and salaries had declined from $2,240,965 to $1,773,670 between the 2015 and 2016 financial years. The financial statements also give further insight into the terms of the arrangement between the Branch and the Commonwealth Bank in relation to the union-issued credit card, stating:

The maximum exposure of the organisation for the usage of Commonwealth Bank Business Cards and the auto pay facility is $750,000. This is secured by an undertaking in respect of the liquid assets of the organisation.

152    Taken in conjunction with other evidence as to the number of officials and employees within the Branch, and their location, as well as the evidence concerning the organisational structure and management of the Branch, including Ms Boucher’s circumstances and duties during the period of her employment, the picture which emerges with respect to the Branch is not at all that of a “large and asset rich” organisation. It is more akin to a relatively modest business encountering difficult trading circumstances which have occasioned a reduced income.

153    But even such a comparison is inaccurate, because neither the Union nor its sub-unit, being the Branch, is carrying on business with a view to profit. Insofar as the Branch is semi-autonomous, it is conducted not for profit but for the objects set out in the Rules (clause 4). Further, although as President Mr Smyth has duties ordained in the Divisional Rules, he is not the chief operating officer of the Branch. That is the Branch Secretary. Further, the Branch did have a well-qualified in-house, employed Finance Manager (Ms Boucher). Yet, and this, truly, is no adverse criticism of her, it is quite obvious that her duties were overwhelming. Yet further, it is not, in my view, apt, in relation to the Branch, to regard the relationship between the President and Secretary as akin to that of a chairman of a board of directors and a managing director. There are some superficial resemblances but these do not survive the evidence as to the direct representational and related member and Lodge liaison roles undertaken by Mr Smyth, which so obviously consumed a good deal of his time, and did so by taking him frequently away from his Mackay office base, to say nothing of away from Brisbane where the Branch Secretary, Mr White, was located.

154    It was also put on behalf of Mr Smyth in submissions that the test posed by s 285 of the FWRO Act was an objective one, and multifactorial in the sense already mentioned. This is correct. Also correct was Mr Smyth’s additional submission, citing by analogy Australian Securities and Investments Commission v Vines (2005) 65 NSWLR 281 in support, that the content of an officer’s duty was influenced by the purpose of an officer’s actions. Another point about s 285 accurately made for Mr Smyth in submissions was that whether there had been a contravention of s 285 was not to be judged via the wisdom of hindsight. As Edelman J also observed in Cassimatis, at [487], in relation to the analogous corporations law provision, the statutory test is “forward looking”.

155    It is clear enough from the authorities discussed that Mr Smyth’s absence of dishonesty in the incurring of the plumbing expense via his union-issued credit card is not exculpatory in respect of the alleged contravention of s 285 of the FWRO Act.

156    Given the conclusion which I have reached as to the meaning of the Policy, Mr Smyth’s view that use of the credit card in an “emergency” per se was an authorised category of private expenditure was wrong. On the view I have taken, and apart from infrequency, circumstances were “exceptional” if, additionally also, the expense could not be met from available private funds.

157    But it does not follow from this that Mr Smyth took a negligent view of the interpretation of a permitted category of private expenditure, i.e. that it permitted a use of the card in an emergency pure and simple. True it is that Mr Smyth was, even at the time, a long-serving senior officer of the Branch within the Union. The very nature of his duties over the years must have required him to do his best to understand industrial and workplace health and safety legislation, industrial awards and enterprise agreements as relevant to the duties he undertook. True it is too that Mr Smyth’s responsibility within the Branch, as one of those required to monitor credit card use, necessarily obliged him to do his best to understand the permitted categories of union-issued credit card expenditure, quite apart from the fact that this might reasonably be expected of a person to whom such a credit card was issued.

158    Accepting all this, I am not persuaded that his understanding of an emergency per se as a permitted category of expenditure was negligent. I can well see how a layman, even one with Mr Smyth’s background and experience and with his responsibilities in the Branch, might reasonably characterise the “infrequent and exceptional” category of permitted private expenditure on the credit card as an “emergency” category. Although I do not share that view as to the meaning of a permitted private expenditure category, Mr Smyth’s view does not do violence to a way one might reasonably understand the language of the Policy. So characterising and understanding the exception hardly makes for a free for all in relation to the incurring of private expenditure on a union-issued credit card, rather the reverse.

159    The incurring of private expenditure by the use of the union-issued credit card was not wholly forbidden by the Policy. Some categories of private expenditure were permitted. But these expenditures had to be declared. Mr Smyth was, in respect of the plumbing expense, attentive to an obligation to declare the expenditure.

160    For the reasons given, I am not persuaded that Mr Smyth’s understanding of an “emergency” category of permitted private expenditure by the use of the union-issued credit card was negligent.

161    But it is not just the incurring of the private expenditure upon which the General Manager relies. As pleaded against Mr Smyth, the case also relies upon circumstances where, while he was President, there was a related adding of the expenditure amount incurred to a loan account debt on interest-free and no security terms and a related alleged failure to clear the credit card debit balance within the usual period.

162    The Branch (or, strictly, the Union) was empowered to make a loan to Mr Smyth. It was for the General Manager to prove that a running balance loan account arrangement in the terms already described was either not approved or approved in circumstances where Mr Smyth ought to have abstained from voting. This the General Manager did not do. Indeed, in amplification of the General Manager’s pleaded case, it was put by senior counsel, “… but the Commissioner, in its case, doesn’t rely on a breach of the rule [in relation to the making of the loan] to found a contravention. It simply relies on the fact that the contraventions all relate to the specific transactions that I’ve taken you to, but it relies on the fact that this practice of incurring expenses meant that, in effect, the circumstances were that Mr Smyth had an ongoing loan and the impost that that had on the branch and the benefit that Mr Smyth received by reason of this arrangement that he had in place as president of the district branch”.

163    The evidence elicited from Ms Boucher in cross-examination, quoted above at [106], is destructive of the General Manager’s case insofar as it is reliant on an absence of security for the debit balance from time to time on Mr Smyth’s loan account. The amount thereof was always relatively modest, and monitored, notably by Ms Boucher, even if the precise amount of the debit balance was not always known to Mr Smyth. There was nothing untoward in terms of accounting practice, in the absence of any security for the from time-to-time debit balances in the loan account in the circumstances.

164    To return to the obligation imposed on Mr Smyth by s 285 of the FWRO Act, I have already concluded that there was no want of care and diligence just by his incurring the expenditure. Nor did the related debiting of the equivalent amount to his approved interest-free, balance repayable on demand loan account ipso facto confer any benefit. It only did so to the extent and for the period that the related debit either created or increased a net debit on the loan account.

165    In evidence are two documents (documents C1.35 and C1.36) from Branch financial records concerning the loan facility which existed as between the Union (via the Branch) and Mr Smyth. One shows the running balance on his loan account, the other just shows periodic debits and credits.

166    From these, it emerges that his use of his union-issued credit card in August 2015 to incur the plumbing expense of $934.99 increased on 10 August 2015 his then loan account debit balance from $3,523.62DR to $4,458.61DR. Also revealed, however, is that on, 29 September 2015, via two credits to the account, one of $100 (being a regular weekly payroll deduction pursuant to a standing direction to the Branch which Mr Smyth then had in place) and the other of $900 (being attributable to the total of accumulated overnight allowance entitlements credited by Mr Smyth’s direction to his loan account), the loan account balance was reduced to a debt of $3.032.33DR. Those credits were in addition to a credit of $550 on 1 September 2015, which had reduced the then total debit balance on his loan account from $4,480.57DR to $3,930.57DR.

167    On the evidence, the loan facility was, as I have mentioned, a running balance loan facility. And it was on terms that no interest was payable by Mr Smyth on any debit balance from time. Equally, it was on terms that no interest was payable by the Union to Mr Smyth on any credit balance from time to time. It was within power for the Union (via the Branch) to make a loan. The Union’s (via the Branch’s) power under the Rules to make a loan to a person was not qualified by a requirement that any such loan must be on commercial terms, be they requiring that a loan bear interest or otherwise.

168    It is at this point that I encounter some real difficulty arising from the General Manager’s concession above, at [162], and the way in which the General Manager has chosen to frame the pleaded alleged contravention of s 285 of the FWRO Act. Of the particulars identified above from the pleadings, one is:

(h)     receiving the benefit, via the incurring of the plumbing expense and the addition of the amount thereof to his loan account of a credit facility for his personal benefit without incurring interest and/or requiring security for that loan.

But the statement in amplification made by the General Manager’s senior counsel indicates that the approval of Mr Smyth’s loan facility is not challenged. That loan facility was on the terms I have mentioned.

169    Recalling that the pleaded focus is upon the receipt of a benefit arising from a particular credit card expenditure, Mr Smyth did receive a benefit when, on 10 August 2015, his then loan account debit balance was increased without his having to pay any interest on the amount by which the debit balance was increased. However, by the credits made on 1 September 2015 and 29 September 2015, any benefit arising from the increase in the debit balance on 10 August 2015 had been wholly eliminated.

170    The position thus stated, while accurate in isolation, is complicated by the debiting to Mr Smyth’s loan account on 8 August 2015 of the sum of $2,073.49 in respect of airfares to the United States of America (and return) for his wife when she accompanied him there both for the purpose of his attending a mining unions convention in Las Vegas and for holidays. There is an allegation of statutory contraventions arising from this trip but that concerns the incurring of a car hire expense for the hiring of a car rented in Los Angeles on arrival from Australia and returned some days later in Las Vegas. Those allegations are further discussed below.

171    Further, between 10 August 2015 and 29 September 2015, there were a series of very minor debits to Mr Smyth’s loan account arising from sundry declared private expenditure uses of his union-issued credit card by him. Even added to the plumbing expense debit of 10 August 2015, the total of these minor debits was wholly absorbed, and exceeded, by the loan account credits of 1 and 29 September 2015.

172    For the present, it seems to me that there is an inherent tension between not alleging a contravention of any, or each, of ss 285, 286 and 287 of the FWRO Act in respect of the anterior approval of a loan facility on the terms indicated and alleging contravention of these provisions arising from the receipt of a benefit arising from a debit to that loan facility in accordance with those same terms. Even just looking to s 285 of the FWRO Act, it is certainly possible to see how a contravention of that section might arise from participation by Mr Smyth as President in a Board of Management decision whereby a loan facility on such terms, if only as to no interest on a debit balance, was approved for him. But the relevant considerations in respect of such a loan facility may not be one way. The practice of the Branch was to pay, on claim, overnight allowance but in arrears. It is not hard to see good reason for that, arising from the evidence which Mr Smyth gave. Even though driving for large distances was routinely entailed when his duties took him from his Mackay home into Central Queensland, he tried to return home rather than stay overnight, if possible, even if that entailed traveling into the evening. Whether that was possible might depend on the nature and extent of the calls on his time at a given site. If it was not possible, and if he could not find hosted accommodation, he not only had to find motel accommodation but he had to have one or more meals, plus perhaps incur some incidental expenses. On the evidence, there was an unpredictable quality about all this. But the contingency existed of his having to incur expenses of a kind that would fall within the category of expense intended to be covered by the overnight allowance. So the contingency always existed for Mr Smyth (and any other like officer or official for that matter) of having to incur such expenses in the first instance, even though they were expenses for which the Branch accepted it was responsible, via providing for their coverage via the overnight allowance.

173    The General Manager submitted that the acceptance by the Branch was on terms that the allowance was paid in arrears and that Mr Smyth (or another officer or official) should therefore order personal finances accordingly and have sufficient financial resources from savings or personal credit card facility to meet, in the first instance, the types of expenses covered by the overnight allowance. That was undoubtedly one option. It is also possible to see how another option might be for a Board of Management to recognise that an officer or official who incurred such an expenditure in the first instance was conferring an interest free benefit on the Branch, pending reimbursement via the payment of an overnight allowance. In turn, recognising that such expenditures might fall within a permissible private expenditure category for a union-issued credit card, it is possible to see how resultant debits might be treated as loans by the Union (via the Branch) to the officer or official, to be interest free in recognition of an officer or official being kept out in the first instance of the allowance intended to cover such expenses.

174    There is a speculative quality about the foregoing as to what might be a rationale for approving a running balance loan facility on interest free terms. That necessarily flows from the General Manager not having put in issue the proprieties, in terms of ss 285, 286 and 287 of the FWRO Act, of the approval of such a facility and of any participation by Mr Smyth in such approval either at all or in circumstances where he was one who stood to benefit, in the way exemplified by the 10 August 2015 plumbing expense debit. Document C1.35 shows that the loan facility commenced in November 2014. The absence of controversy about the approval of the facility meant that there was no evidence led by Mr Smyth about the circumstances attending that approval or terms, including the reasons for that.

175    The precise amount of the benefit conferred on Mr Smyth arising from the debiting of the amount of the plumbing expense to his loan account was not quantified on the General Manager’s case. It was not whatever interest rate might be attracted on a debit balance in the Branch’s credit card facility with its banker. That was because the overall credit card debt was cleared in full each month. I did not have evidence of what might be a commercial interest rate on such an unsecured running balance loan facility. Whatever might be such an interest rate, the benefit from not having to pay it was progressively reduced and then eliminated by the credits to the loan account which occurred on 1 and 29 September 2015.

176    In the circumstances described, it seems to me that, while there was an unquantified, transient benefit conferred on Mr Smyth by the debiting of his loan account with the amount of the plumbing expense in accordance with the terms of his approved loan facility, I cannot, in a civil penalty proceeding, assume that this loan facility with those terms was approved in circumstances constituting a contravention of either or each of ss 285, 286 and 287 of the FWRO Act and that Mr Smyth was a party to such a contravention.

177    No want of reasonable care and diligence contrary to s 285 of the FWRO Act could arise from the mere receipt by Mr Smyth of a benefit arising from the debiting of an amount to an approved loan facility in accordance with its approved terms.

178    Thus, however one approaches the alleged contravention of s 285 of the FWRO Act arising from or in relation to incurring of the plumbing expense and its debiting to his loan account, no contravention is proved.

179    I now consider an alleged contravention of s 286 of the FWRO Act. The General Manager has offered the same particulars as with s 285 in respect of what is said to amount to a contravention of that section.

180    The General Manager’s pleading offered no differentiation between conduct which was said to constitute a contravention of s 286(1)(a) and conduct which was said to constitute a contravention of s 286(1)(b) of the FWRO Act or whether the conduct is said to contravene each of s 286(1)(a) and s 286(1)(b). Although, in the context of the like duties in corporations law, it has long been recognised that these duties are closely connected and often difficult to separate in a given case, they are conceptually separate: The Bell Group Ltd (in liq) v Westpac Banking Corporation (No 9) (2008) 39 WAR 1, at [4456] (Bell v Westpac No 9), per Owen J (a conclusion not affected by the subsequent appellate history of this case). As the pleading refers just to “s 286(1)”, I shall assume that it is alleged that each of s 286(1)(a) and s 286(1)(b) of the FWRO Act has been contravened.

181    The correctness of the General Manager’s submission that the expenditure and loan of Union funds, and a failure to account for, reimburse or record those funds, is clearly “related to” the financial management of the Union depends upon the level of abstraction. Both as President and as a member of the Board of Management for the Branch, Mr Smyth had strategic, financial managerial responsibilities and was possessed of particular related powers in respect of each of these subjects. Such powers fell to be exercised either individually or collectively. As to the latter, it fell to the board to approve particular loans and, in some instances, expenditures. In relation to other expenditures, it fell to the board to approve arrangements and related policies pursuant to which others, including Mr Smyth, might permissibly expend Branch funds.

182    In relation to union-issued credit card expenditures overall, Mr Smyth, as President, had some monitoring responsibilities, notably in respect of the use of such cards by those at Lodge level. Others also had financial managerial and monitoring responsibilities, notably the Branch Secretary and the Finance Manager.

183    Mr Smyth also had separate, individual expenditure and reporting compliance responsibilities with respect to the credit card issued to him, because he held an office which entitled him to such a card. As to the latter, Mr Smyth’s submission that these responsibilities did not entail the exercise of a power conferred on him by union rules as President ultimately leads nowhere in terms of removing him from the purview of s 286(1)(a) of the FWRO Act. That is because, as the holder of an office entitling him to such a card, Mr Smyth had a duty to ensure that, as such an officeholder with a card so issued, he incurred expenditure via that card only in accordance with the Policy.

184    In Bell v Westpac No 9, at [4466], and after a discussion of authorities, Owen J adopted, subject to a caveat which he voiced as to principle (c), the summary offered by Ipp J (with whom Malcolm CJ and Seaman J agreed) in Permanent Building Society (In liq) v Wheeler (1994) 11 WAR 187, at 218, as to the principles which, in corporations law, attend deciding whether a director has complied with the duty to exercise powers or discharge duties properly:

(a)    Fiduciary powers and duties of directors may be exercised only for the purpose for which they were conferred and not for any collateral or improper purposes.

(b)    It must be shown that the substantial purpose of directors was improper or collateral to their duties as directors of the company. The issue is not whether business decisions were good or bad; it is whether the directors have acted in breach of their fiduciary duties.

(c)    Honest or altruistic behaviour will not prevent a finding of improper conduct on their part if that conduct was carried out for an improper or collateral purpose. Whether acts were performed in good faith and in the interests of the company is to be objectively determined, although statements by directors about their subjective intentions or beliefs will be relevant to that inquiry.

(d)    The court must determine whether but for the improper or collateral purpose the directors would have performed the act impugned.

185    The caveat voiced by Owen J in relation to principle (c) was with “whether acts were performed in good faith and in the interests of the company is to be objectively determined” was correct or whether the test is subjective. Ultimately, in Bell v Westpac No 9, at [4608], after a further discussion of authority, Owen J concluded that the test in principle (c) was not wholly subjective. While acknowledging that it was not for the courts to manage companies, he opined that an assertion of directors that their conduct was bona fide in the best interests of the company was not conclusive if, on consideration of the surrounding circumstances (objectively viewed), that assertion should be doubted, discounted or not accepted. In other words, if a director’s assertion is just fanciful, in light of the surrounding circumstances, objectively viewed, a court is not obliged to accept that assertion as credible.

186    In my respectful view, the principles which Owen J identified, subject to the caveat he identified, reflect the position under corporations law and should be applied by analogy when considering whether s 286(1)(a) of the FWRO Act has been contravened.

187    A number of duties which fell on Mr Smyth emerge from the pleadings. One was a duty only to expend Branch (or Union) funds via the credit card issued to him as President only in accordance with the Policy. Another was a duty to clear expenditure so incurred by the closing date. Yet another was a duty to ensure that any borrowing of Union (or Branch) funds only occur in accordance with the terms of an approved loan. As to the latter and here again, it is necessary to note that the General Manager’s case does not entail an allegation that the approval of the loan facility entailed a transgression of the duty to exercise a power, or discharge a duty to act, in good faith in what Mr Smyth believed to be the best interests of the Union. As President, Mr Smyth may well, as a member of the Board of Management, have been a party to the adoption of the Policy. And that adoption undoubtedly did entail an exercise of an approval power. However, the General Manager’s case assumed that the Policy itself, with its permissible categories of private expenditure, had been adopted in good faith and in the interests of the Branch (or the Union); its case was policy transgression, not policy adoption, focussed.

188    Thus, as to the plumbing expense, I fail to see how an expenditure honestly incurred on the basis of a mistaken, but not negligent, understanding that the expenditure fell within a permitted private expenditure category in the Policy was other than discharging a duty in good faith.

189    Likewise, I find it difficult to see how the related increase in borrowing, in accordance with the terms of an approved loan facility, was a borrowing other than in good faith by Mr Smyth. Here, too, the General Manager’s case was not loan facility approval focussed. The General Manager’s case did not entail the allegation that the approval of the loan facility was not in the interests of the Branch (or the Union).

190    For these reasons, I conclude that a contravention of s 286(1)(a) of the FWRO Act has not been made out. Insofar as the contravention case is reliant on s 286(1)(b) of the FWRO Act, it fails for like reasons and also those now given in respect of s 287 of the FWRO Act.

191    As to s 287 of the FWRO, there is an obvious textual and purposive affinity between that section and s 182 of the Corporations Act. This affinity was appreciated by Tracey J, who, in Health Services Union v Jackson (No 4) (2015) 108 ACSR 156, at [113] to [116], offered the following helpful explanation, with reference to prior pertinent authority, of the meaning of s 182, the materially identical s 287(1) of the FWRO Act and how conduct contravening these provisions may also contravene others in just the way the General Manager’s case was pleaded and particularised in the present case:

113    The constraints imposed on officers and employees of corporations by s 182(1) of the Corporations Act are applied by reference to an objective standard. Impropriety “consist[s] in a breach of the standards of conduct that would be expected of a person in [the particular] position by reasonable persons with knowledge of the duties, powers and authority of [that] position … and the circumstances of the case …”: Doyle v Australian Securities and Investments Commission (2005) 227 CLR 18 at 28.

114    In their joint judgment in R v Byrnes (1995) 183 CLR 501 at 514-5, Brennan, Deane, Toohey and Gaudron JJ said that:

“Impropriety does not depend on an alleged offender’s consciousness of impropriety. Impropriety consists in a breach of the standards of conduct that would be expected of a person in the position of the alleged offender by reasonable persons with knowledge of the duties, powers and authority of the position and the circumstances of the case. When impropriety is said to consist in an abuse of power, the state of mind of the alleged offender is important …: the alleged offender’s knowledge or means of knowledge of the circumstances in which the power is exercised and his purpose or intention in exercising the power are important factors in determining the question whether the power has been abused. But impropriety is not restricted to abuse of power. It may consist in the doing of an act which a director or officer knows or ought to know that he has no authority to do.”

(Emphasis added).

115    It is, therefore, possible for a director to act improperly even if the director has no intention of acting dishonestly or otherwise than in the best interests of the company: see Chew v R (1992) 173 CLR 626 at 640 (Dawson J), 647 (Toohey J).

116    The approval of the withdrawal of a corporation’s funds and the making of such withdrawals by a director or officer who lacks the authority to make them and the subsequent application of such funds for the personal purposes of the officer constitutes a contravention of both ss 181 and 182 of the Corporations Act: cf Re Wan Ze Property Development (Aust) Pty Ltd (2012) 90 ACSR 593 at 601-2 (Black J).

192    Applied in the context of s 287 of the FWRO Act, it might be said that it is possible for an officer or official of a registered organisation to act improperly even if that officer or official has no intention of acting dishonestly or otherwise than in the best interests of the organisation. Thus, with respect to s 287 of the FWRO Act, Mr Smyth’s absence of dishonesty is not exculpatory in relation either to the incurring of the plumbing expense or the related debiting of the amount of that expense to his loan account. However, what is exculpatory, in my view, is that, objectively, his view of what was a permissible private expenditure category, though mistaken, was, for reasons already given, a reasonable one and, related to that, there was no reason why he ought to have known that the related debiting of the amount of that expenditure to his approved loan account was otherwise than in accordance with the approved terms of that account.

193    For these reasons, I conclude that the General Manager has not proved a contravention of either ss 285, 286 or 287 of the FWRO Act in relation to the use of Mr Smyth’s union-issued credit card to incur the plumbing expense or in relation to the related debiting of the amount of that expense to his approved loan account.

The Dental Expense

194    On 5 May 2016, Mr Smyth sought and obtained professional dental treatment at the Spring Hill Dental Practice in Spring Hill, Brisbane. This practice was located about 500 metres away from the Branch office. Mr Smyth chose this practice to receive treatment because of its proximity to that Union office. He related in oral evidence, and I find, that he was then in Brisbane for Union business, in part related to dealings with Rio Tinto and in part for miscellaneous Union issues. He had been suffering from a toothache while down in Brisbane, which had become intolerable; hence a need to seek and obtain dental treatment quickly. It transpired that he had an abscess on a tooth. It is inherently unlikely that one would forget such an experience.

195    The amount of the dental expense paid for by Mr Smyth’s use of the union-issued credit card was $729.00.

196    On 5 May 2016, at 4.21pm, the very day he incurred the expense, Mr Smyth sent an email to Ms Boucher declaring the incurring of the dental expense, attaching the related receipt of that same date requesting Ms Boucher to “take out of pay $100 a week commencing next week for this receipt, till paid” and describing his use of the card to incur the expense as “inadvertent”.

197    Although the dental treatment doubtless ensured that Mr Smyth was able to continue to discharge his Union duties in Brisbane without being debilitated by severe toothache, the expenditure was not incurred in conjunction with Union-related expenditure. Mr Smyth accepted this. Further, Mr Smyth’s contemporaneous description of the use of the card as “inadvertent” is inconsistent with his later explanation of having insufficient personal funds. Yet further, the description which he used in his contemporaneous email is inconsistent with his having acted, on this occasion, on a belief that one permissible use of the card was in an emergency. It is not hard to see from the circumstances related how a need to undertake dental treatment and incur a related expense might be described as an “emergency”. However, that is not the explanation he gave at the time for why he used his union-issued credit card to incur the dental expense. Mr Smyth’s contemporaneous description of why he had used the card, especially as it was given at a time when he had no reason to suspect that the use would come under later scrutiny, is inherently likely to be the most reliable. I find accordingly. That explanation, coupled with his promptness of disclosure of the expenditure, is completely at odds with any dishonesty attending his use of the card.

198    Honesty per se is not, however, exculpatory in relation to any contravention of the standards of conduct required by s 285, s 286 or s 287 of the FWRO Act. The union-issued credit card was a discrete card, the use of which was permitted only on terms specified in the Policy. Although, for reasons already given, I accept that a reasonable person, might have formed the view, albeit one mistaken as to the true meaning of the Policy, that a category of permissible private expenditure was in an “emergency”, that was not the basis upon which on this occasion Mr Smyth used the card issued to him as President. Viewed objectively, and absent an asserted “emergency” use, the incurring of the dental expense, even via an inadvertent use of this card, was not an act with the degree of care and diligence that a reasonable person, who held the office of President of the Branch in the Union’s circumstances (as those circumstances have already been related) and who occupied the office of President with the same responsibilities within Branch as Mr Smyth, would have committed. Although, having regard to the authorities discussed above, s 285 of the FWRO does not look to a standard of an official in the position of President and in the prevailing circumstances who can always be relied upon to give close attention to all Union affairs in his hands, it does impose an expectation of ordinary care. Objectively, the inadvertent use of the union-issued card to incur this dental expense was negligent. Especially that is so in respect of when so measured in relation to an office which has a very particular Branch leadership role and a responsibility for monitoring the use of like union-issued cards by other officers and officials within the Branch.

199    The General Manager gave like particulars in respect of the incurring of the dental expense to those given in respect of the incurring of the plumbing expense. Thus, the alleged contravention of s 285 of the FWRO Act was not said to be constituted solely by a use of the union-issued credit card to incur the dental expense contrary to the Policy without reasonable care and diligence. It was alleged also to be constituted by the related addition of the amount of that expense to Mr Smyth’s loan account of a sum incurred for his personal benefit “without incurring interest and/or requiring security for that loan”. As already discussed, the General Manager has not made the approval of the loan account on particular terms controversial. But that approval always linked any increase in a loan account balance occasioned by private expenditure effected by the union-issued credit card to private expenditure within a category permitted by the Policy. The loan account approval never extended to an increase in the loan account balance by virtue of any private expenditure so incurred. Objectively, the negligent use of the union-issued credit card by Mr Smyth carried with it a no less negligent sequel, which was to increase his loan account debt in an unauthorised way. Even as President, Mr Smyth had no right to do this unilaterally.

200    Objectively, the use by Mr Smyth of the union-issued credit card and related debiting of the loan account facility in the way described contravened s 285 of the FWRO Act in each of the two ways described.

201    Further, and also objectively, Mr Smyth’s incurring of the dental expense via his union-issued credit card and the related debiting of his loan account was, in the sense described in the authorities referred to above, improper. Granted the standard is not one of perfection. But ordinary care, in respect of a card issued to him as President for use only in accordance with the Policy, ought to have led him not to use that card to incur the dental expense. So to do was, as I have found, objectively negligent. Ordinary care as to when he might correspondingly debit his approved loan account ought, objectively, to have resulted in a conclusion that expenditure inadvertently incurred could not permissibly be debited to his approved loan account, as opposed to creating an obligation forthwith to refund in full the expense inadvertently visited on the Branch. Once again, ordinary care by a person occupying the position of President of the Branch ought, objectively, inexorably to have led to a conclusion that he had no power unilaterally to vary the basis upon which debits were permissibly made to his loan account. A reasonable person occupying the position of President ought to have been aware that the making of a loan to a member or a variation of the terms of a loan was for the Board of Management. That is quite apart from an obvious conflict between duty and interest in the circumstances, even if there were such a unilateral power. Having regard to the authorities already discussed, these conclusions mean that Mr Smyth also contravened s 286 and s 287 of the FWRO Act.

202    For these reasons, I conclude that between 5 May 2016 in incurring the dental expense and on or about that date when a corresponding debit was made to his loan account, Mr Smyth, contravened ss 285, 286 and 287 of the FWRO Act.

USA Car Hire Expense

203    Between 27 July 2015 and 30 July 2015, Mr Smyth attended a United Mine Workers of America (UMWA) conference in Las Vegas in the United States of America as a representative of the Union’s Mining and Energy Division. Further, he was not just an attendee, he was also a guest speaker, speaking on behalf of the Union.

204    Greater insight as to Mr Smyth’s planned activities when in the USA was offered by him in an email of 12 July 2015 which he sent to fellow Branch executive members, Ms Ross and Ms Vallepa, prior to his departure:

I will be out of the country in the USA from Saturday 18 July 2015 to Monday 1st August 2015.

The first week I have taken annual leave but towards the end of the week of the 24th July I have meetings planned with a couple of unions in the US including the ILWU for the Rio Tinto campaign smart caps & Rio matters) & UMWA over various matters including ongoing campaigns & meeting with NIOSH about black lung/ other matters.

This is a part of an invite to the National CFMEU from the UMWA so both myself & Tony Maher will attend on behalf of the CFMEU.

205    Although Mr Smyth used personal leave to attend the conference, on any view his attendance at the conference was Union related. I accept, unreservedly, Mr Smyth’s explanation that the Union maintained relations with the UMWA and that there were advantages for the Union and its members in that relationship. Contemporary corroboration of those advantages as Mr Smyth saw them is offered in his email of 12 July 2015.

206    Mr Smyth flew from Australia to Los Angeles. The cost of his airfare was met by the Union (from funds provided by the Division). He was accompanied by his wife.

207    Mr and Mrs Smyth arrived in Los Angeles on 19 July 2015. Upon arrival at Los Angeles international airport, Mr Smyth hired a car to drive, with his wife, to Las Vegas. They did not drive there directly upon landing. Instead, they meandered there, using the time also to undertake some recreational sightseeing.

208    On 24 July 2015, at Mamouth Lakes, California, Mr Smyth used his union-issued credit card to pay $US33.29 for fuel at a Shell Garage. Mamouth Lakes lies north of Los Angeles, but not on a direct route to Las Vagas. This expense became item 5 in Table A in the annexure to the amended statement of claim (item 5 fuel expense).

209    In annexing the related receipt to a CCU form dated 23 August 2015, Mr Smyth annotated the receipt concerned, “Fuel Drive to Las Vegas UMWA Convention”. This annotation notwithstanding, he declared the expense on the CCU form as a private expense, to be deducted from his pay. I also note, incidentally, although nothing in itself was made of this by the General Manager, that, although he declared the exact amount of the expense as shown on the receipt, it does not seem to have occurred to him that the dollar amount was in US, not Australian, dollars. At the time, the Australian dollar equivalent was $A45.87.

210    The personal banking records of Mr and Mrs Smyth in evidence disclose that they met other expenses at Mamouth Lakes from their personal funds. This contemporaneous evidence discloses that Mr Smyth was, according to his understanding of what was or what was not authorised union-issued credit card use, trying to maintain a separation between that which was authorised and that which was not. This does not just reinforce my view about his honesty; it has also contributed to my conclusions about reasonable diligence, good faith and propriety.

211    On 28 July 2015 (USA time), Mr Smyth used his union-issued credit card to pay US$795.94 (AUD$1,096.79) in respect of the car hire (USA Car Hire Expense).

212    On or around 27 February 2016, Mr Smyth submitted a CCU form recording his use of the credit card in respect of the USA Car Hire Expense. In that form, Mr Smyth did not identify whether the amount was or was not a District Branch cost in the column headed “District Cost?” and did not include the amount under “PRIVATE PART TO BE DEDUCTED FROM PAY”.

213    Based on what is disclosed by maps which were tendered in evidence, the road distance between Los Angeles and Las Vegas, depending on which point to point route is taken, is about 290 miles (about 460 to 500 kilometres). Again based on what was revealed by the maps, but doubtless depending upon traffic to some extent, it takes at least about 4 and a half hours to drive this distance, keeping within speed limits. The car hire documentation discloses that Mr Smyth and his wife drove about 1,500 kilometres when using the hire car. Near enough therefore, they drove about 1,000 kilometres    more than a point-to-point journey would have entailed.

214    The General Manager submitted that this USA Car Hire Expense was unauthorised, because it was contrary to the Policy, on the basis that it was not “work-related expenditure”. It was also submitted that it was not incurred on behalf of the Branch. Yet further, it was submitted for the General Manager that Mr and Mrs Smyth should have driven directly on arrival from the airport to Las Vegas. I understood this latter submission to be something of an alternative in the event that some component of the expenditure was work-related. A further submission was that the car hire expense could not be work-related, because it was incurred during a period when Mr Smyth was on personal leave.

215    None of these submissions should be accepted.

216    On any view, the USA Car Hire Expense entailed the incurring, by the use of the union-issued credit card, of work-related expenditure and what the Policy terms “personal expenditure … incurred in conjunction with Union related expenditure”. This was a hybrid expense. It was a mix of the work-related and, to the extent that it entailed any diversion and related journey prolongation, the private and recreational. It was no different in substance to a room-service or mini-bar expense paid for at the same time as a union duty related overnight accommodation expense via the one union-issued credit card payment. On the view I take of the true construction of the private expenditure authorised by the Policy, Mr Smyth was therefore authorised by the Policy to use his union-issued credit card to incur the USA Car Hire Expense. Indeed, in relation to the private component, it offers a paradigm example of one category of authorised private usage.

217    For these reasons, I reject the General Manager’s allegation that the USA Car Hire Expense was an unauthorised use of Mr Smyth’s union-issued credit card.

218    The item 5 fuel expense was also one incurred in conjunction with a Union-related expense because, at least in part, the car hire was Union-related.

219    In the course of his oral evidence, Mr Smyth accepted that, with hindsight, the USA Car Hire Expense could have been apportioned. His explanation for not doing this was that he had followed the practice in place, which was that “the Union would pay for you to get from point of destination and return”.

220    Mr Smyth’s attendance at the conference was approved within the Union, at Division level. This is indicative that Mr Smyth’s attendance at the conference was considered beneficial to the whole of the Division, which necessarily included the Branch. There was nothing in evidence which disclosed that it was forbidden for Mr Smyth to utilise driving, as opposed to internal air travel, as the means of completing his journey to the conference. Further, it is not for the General Manager, as it was not for the Commissioner beforehand, to make what are essentially union managerial value judgements. Subject to compliance with the law, which notably includes the FWA, the FWRO Act and the Rules, the making of union managerial value judgements is for a matter the union concerned via its officers. Inferentially, even if Mr Smyth had chosen to use internal air travel, that would at least have entailed the further expense of taxi travel from the Las Vegas airport to the conference hotel. I find that his choice of driving by hire car was permissible.

221    In circumstances where Mr Smyth and his wife had just completed a very lengthy flight across the Pacific Ocean from Australia to Los Angeles, there was nothing unreasonable in Mr and Mrs Smyth choosing not immediately to set out on and complete a four-and-a-half-hour drive to Las Vegas. It would have been perfectly reasonable for them to stage their road journey. It is the General Manager’s submission to the contrary which, with respect, is unreasonable.

222    In the circumstances, it would not be unreasonable for there to be one overnight stop, perhaps on arrival in Los Angeles, perhaps part-way to Las Vegas. In turn, in my view, that means that it would be reasonable to expect that up to two days including an overnight stop might have been entailed in proceeding to Las Vegas by car.

223    Further, the Policy refers to a conjunction with “Union related expenditure” (emphasis added). As was correctly submitted on behalf of Mr Smyth, the Union is but one legal entity. Approval at Division level of Mr Smyth’s attendance at the conference necessarily carried with it that the attendance was “Union related”. There was no need for separate, Branch approval. Further, it is nothing to the point, save for the insight it offers as to Mr Smyth’s character and commitment to trade unionism and the objects of the Union and the Branch of which he was President, that the expense was incurred while Mr Smyth was on personal leave. He chose, voluntarily, notwithstanding he was on leave, to devote a portion of that to an approved, obviously Union-related activity. He also chose, as his email of 12 July 2015 also manifests, to inform recipients that he would be contactable by phone and email.

224    Recalling the authorities discussed above in relation to each of ss 285, 286 and 287 of the FWRO Act, and the particulars of alleged contravention pleaded by the General Manager (of the same kind as already set out), I have given quite anxious consideration to whether any contravention of ss 285, 286 or 287 of the FWRO Act is proved in light of the findings which I have made.

225    I accept the submission made on Mr Smyth’s behalf that the USA Car Hire Expense was honestly incurred by Mr Smyth. That is not only because it was authorised but also because he declared the expense. I accept that he was operating under an understanding that the Union would pay for getting to the conference destination. Mr Smyth’s error, which on reflection he frankly conceded in oral evidence, was in not apportioning the USA Car Hire Expense. Equally, of course, there may well have been part of the item 5 fuel expense which was not wholly personal. If the hire car fee paid also included some allowance for fuel consumption, a proportionate amount of overall fuel cost may have to have been treated as wholly private and repayable by Mr Smyth. As with the car hire cost itself, such a thought just does not seem to have occurred to Mr Smyth at the time. Instead, informed by his view that, because the journey took him to the conference, the entire car hire was not a personal expense, he has declared but not apportioned it. Likewise, he seems to have thought that it was sufficient if he bore himself, by repayment, the cost of the extra fuel purchased. Mr Smyth’s then ignorance about apportionment meant that he was mistaken but he was consistently mistaken.

226    Because, to my observation, he is an astute man, when the concept of apportionment was explained to him, he readily understood and accepted it was applicable in relation to the USA Car Hire Expense. I am in no doubt that these mistaken views were honestly held by Mr Smyth. But honesty is not exculpatory. The test in s 285 of the FWRO Act is objective, albeit attended with evaluative features, as already highlighted.

227    Neither is it exculpatory, as was put, that Mr Smyth might alternatively, and at greater cost to the Union, have flown from Los Angeles to Las Vegas. That is not what occurred.

228    In each instance, and having regard to the difference between the approximate length of a point to point journey and the distance actually travelled by hire car, between about 33% and 40% of the car hire expense (based on days of hire) and a proportion of the overall fuel expense, based on point-to-point mileage compared with total mileage, could reasonably be regarded as “conference related expenditure”. Only by proportionate calculations could any sum owed by Mr Smyth to the Union be ascertained. As it happens, nothing of the USA Car Hire Expense has been reimbursed by Mr Smyth to the Union but all of the additional fuel expense has, after its addition to his loan account debt, been repaid by him.

229    Given that Mr Smyth’s approval to attend the conference was given at Division level and the USA Car Hire Expense was an expense incurred on a credit card account maintained by the Branch with the debit forming part of a monthly balance paid in full from Branch funds, it may be that there is an internal accounting which ought to have occurred as between the Division and the Branch in respect of this expense. I do not, however, consider that Mr Smyth’s role as President required that he undertake that internal accounting.

230    A reasonable layman holding Mr Smyth’s office was entitled to assume, having declared the expense on the form, that any necessary internal accounting would occur via the Branch’s suitably qualified in-house Finance Manager dealing with the Union’s Divisional office. He was likewise entitled to assume he would be advised about any need to apportion the car hire expense, and the overall fuel expense, and to refund the portion attributable to a recreational journey.

231    It might be said of course that Mr Smyth could have done more than just declare the USA Car Hire Expense. He could, for example, have sought advice from Ms Boucher, whom I have no doubt had the requisite knowledge and experience to advise him about apportionment. To expect this however, is, in my view, to impose too rigorous a test when objectively determining reasonable diligence. Seeking such advice would be an act of someone in his office in the Union’s circumstances who always gets things right. This conclusion also affects the aspect of an absence of increase in Mr Smyth’s loan account for the private portion of the USA Car Hire Expense.

232    In short then, viewing Mr Smyth’s actions objectively, my conclusion is that the General Manager has not proved a contravention of s 285 of the FWRO Act in relation to the USA Car Hire Expense or the item 5 fuel expense. Neither, in my view, has the General Manager proved that impropriety or absence of good faith attended Mr Smyth’s incurring of the USA Car Hire Expense. Not only did he not know that the expense was unauthorised, but more importantly there is no reason why he ought to have known. That is because, to the extent it had a private component, that component was Union-related and thus fell within an authorised, private expenditure exception in the Policy. Further, for reasons already given, having declared the expense, a person holding Mr Smyth’s position in the circumstances of the Union (at Branch level) was entitled to expect that the requisite internal accounting would occur and, further, that whatever resultant portion was attributable to private expenditure would be debited to his loan account in accordance with its approved terms. For these reasons, my further conclusion is that the General Manager has also not proved the alleged contraventions of s 286 and s 287 of the FWRO in relation to the USA Car Hire Expense.

233    Although the reasons I have given above explain my conclusion that no contraventions are proved in relation to the USA Car Hire Expense or the item 5 fuel expense, a fortifying consideration arises from reflecting on the General Manager’s own submissions. One basis for them in respect of these expenses was that, because the expenses concerned were incurred during a period of personal leave, they could not possibly fall within the terms of what was authorised by the Policy. But the general, permissible category of expenditure, “work-related”, is purposive in character with respect to the incurring of the expense. If the requisite purpose is present and proved, it is nothing to the point that the cardholder incurred it by undertaking a work-related activity and incurring a work-related expense while on personal leave. I consider that the presence of a work-related purpose was clear to the point of demonstration on the evidence. But so, too, was a private purpose. Yet that, on any view, part of the USA Car Hire Expense was necessarily work-related, given the Las Vegas conference destination, does not seem, from the closing submissions, ever to have informed the General Manager’s thinking. Of course, that thinking was also informed by what I have concluded is a misconstruction of the permissible private expenditure exemptions in the Policy. To the extent that it had a private purpose, that this part of the USA Car Hire Expense was incurred “in conjunction with” the work-related element of the expense meant that it was wholly authorised (and the like applies to the item 5 fuel expense).

234    It would seem odd to conclude that the standard of reasonable diligence which a person in Mr Smyth’s office and circumstances had to meet was so high and exacting that the General Manager, with the benefit of representation by senior and junior counsel and a solicitor, may not meet a like standard of exaction.

Melbourne Trip Expenses

235    The birthday of Mr Smyth’s wife, Mrs Kim Smyth, occurred during the weekend of 13 and 14 February 2016. As a birthday present, Mr Smyth arranged for him and his wife to attend a military tattoo in Melbourne. There is no suggestion that the expense of this attendance was met using Mr Smyth’s union-issued credit card.

236    For the purpose, I find, of attending this military tattoo and otherwise marking and celebrating Mrs Smyth’s birthday, Mr and Mrs Smyth flew to Melbourne and returned by air to Mackay. In Melbourne, Mr and Mrs Smyth stayed at the “Oaks on William” at 350 William Street in the inner city.

237    Three expenses incurred in relation to this trip to Melbourne have occasioned alleged contraventions of each of ss 285, 286 and 287 of the FWRO Act by Mr Smyth.

238    Two of the expenses were incurred via the use by Mr Smyth of his union-issued credit card. These were in respect of:

(a)    Accommodation at the “Oaks on William”, inclusive of a credit card service fee: $1,100.25, incurred on 15 February 2016 (Melbourne accommodation expense); and

(b)     Meal and beverages at the “Sofitel Melbourne on Collins”, inclusive of a credit card surcharge, incurred on 13 February 2016: $272.00 (Melbourne dinner expense).

239    The other expense was incurred by the Union, via an American Express (AMEX) account maintained by the Branch, in respect of air travel by Mrs Smyth to and from Melbourne. The expense had two components, a booking fee of $27.50 incurred on 2 February 2016 and airfare expenses of $362.00 incurred on or about 3 February 2016, in all $389.50 (Melbourne airfare expense). The Melbourne airfare expense has not been reimbursed by Mr Smyth.

240    That each of these expenses was so incurred is not contested by Mr Smyth and, in any event, is proved by a relevant business or related financial record in evidence.

241    Of these, the “Oaks on William” accommodation invoice discloses the provision of accommodation for two with a check-in on 13 February and a check-out on 15 February 2016. The two persons accommodated were, undoubtedly, Mr and Mrs Smyth. The related payment voucher discloses that check-out and payment occurred early on 15 February 2016, at about 4.34 am. Inferentially, Mr and Mrs Smyth must have had an early return flight from Melbourne.

242    In respect of the Melbourne accommodation expense, Mr Smyth later completed and lodged with the Branch a CCU form dated 15 February 2016, in which he wrote “15/2/16, Accommodation, $1,100.00, this has been repaid by EFT payment”. On 20 February 2016, Mrs Smyth transferred $1,000.00 to the Branch for the Melbourne accommodation expense. This left a balance of $100.25 outstanding.

243    Regard to the “Sofitel Melbourne on Collins” meal invoice and related credit card payment record discloses that the Melbourne dinner expense was in respect of food and beverages for two persons. These two persons were, undoubtedly, Mr and Mrs Smyth.

244    The occasion for the Melbourne dinner expense has been the subject of differing explanations over time by Mr Smyth.

245    On or about 27 February 2016, Mr Smyth submitted a CCU form in which he recorded the Melbourne dinner expense as a “District Cost”. Mr Smyth attributed this annotation to an accident.

246    As originally pleaded, Mr Smyth’s defence alleged that the Melbourne dinner expense was “work-related expenditure” because he was attending a “CFMEU dinner”.

247    During cross-examination, Mr Smyth conceded that he had used his union-issued credit card “to pay for [his] wife’s birthday dinner on a holiday” and knew at that time that “it was not work-related, in conjunction with a work-related expense, nor an emergency”. Such a concession had first been made by Mr Smyth some 10 days prior to the commencement of the trial in a proposed amended defence communicated to the General Manager’s solicitors by Mr Smyth’s solicitors. In that proposed pleading, the occasion for the use of the union-issued credit card was identified as inadvertence.

248    The Melbourne dinner expense was not refunded to the Branch until 10 April 2017 when Mrs Smyth caused the sum of $272.00 to be transferred to a Branch bank account. That transfer was, I find, a sequel to a report dated 20 March 2017 by Mr Andrew Vickers, then General Secretary of the Division and Mr Mark Watson, then National Finance Manager of the Division, which marked the culmination of a review by them of the finances of the Branch. A copy of that report was provided to Mr Smyth. In that report, Messrs Vickers and Watson identified the Melbourne dinner expense and the Melbourne accommodation expense as “questionable”.

249    Also on 10 April 2017 and, I find, for like reasons arising from his receipt of the report of 20 March 2017, Mr Smyth caused the sum of $100.25 to be transferred to the Branch. The explanation he gave for that transfer is to be found in an email of that date sent by him to Ms Ross. In that, he states, “it appears [he] may have only transferred $ 1000” and wants “to ensure the total amount was paid.” As it happens, by that date, but unbeknown to him at the time, Ms Boucher had already added the $100.25 to Mr Smyth’s loan and it had been paid off.

250    The Melbourne accommodation expense was the subject of differing explanations over time by Mr Smyth. It his amended defence, it was pleaded that “when checking out of the hotel at about 4.30am, Mr Smyth had difficulties with his personal card and so used the Credit Card to pay for the accommodation”. In his evidence in chief, Mr Smyth stated that his ANZ Joint Account card was declined “due to the transaction limit” of “$500”. However, in cross-examination, Mr Smyth conceded that a $500 transaction limit did not exist for this account. Moreover, the evidence led by the General Manager in respect of this account showed that there were sufficient funds in it at the time of checkout for Mr Smyth to have paid for the Melbourne accommodation expense from this account.

251    Of all the expenses and related transactions which have become the subject of the contraventions alleged by the General Manager, I have found those associated with this Melbourne trip in February 2016 the most troubling in terms of Mr Smyth’s honesty, diligence and propriety. Once again, contemporary behaviours, rather than explanations given years after the event, are the more reliable in my view. These send mixed signals.

252    Mr Smyth did promptly declare the Melbourne accommodation expense as a private expense. That declaration was not the act of a dishonest man. He obviously did realise in February 2016 that he needed forthwith to refund in full the amount of that expense. But he was casual to the point of negligence in ensuring he refunded the exact amount.

253    These behaviours are in turn inconsistent with his behaviour in relation to the Melbourne dinner expense. Only a fortnight after incurring that expense, Mr Smyth misdescribed it. This trip to Melbourne was a special one for Mr Smyth. Considering this, it seems inherently unlikely that the occasion for it would have passed from his mind so shortly afterwards. But the misdescription behaviour is not only inconsistent with the accurate declaration of the Melbourne accommodation expense but also with the overwhelming pattern of accurate declaration on CCU forms, even in respect of the most minor of expenses incurred by Mr Smyth on his union-issued credit card. If Mr Smyth really were intending dishonestly to cover up the use of the union-issued credit card on a private trip with his wife, he adopted the most clumsy of methods. Taking into account s 140(2) of the Evidence Act, these thoughts have led me to conclude that his misdescription was not dishonest but rather casual, even cavalier, to the point of gross negligence.

254    Neither the Melbourne accommodation expense nor the Melbourne dinner expense was an expense authorised by the Policy to be incurred via Mr Smyth’s union-issued credit card. These expenses were not “infrequent and exceptional”. As I have concluded above, this phrase describes single category of permissible private expenditure under the Policy. Granted birthdays come but once a year, but that does not make a related expense incurred via a union-issued credit card “infrequent and exceptional”. Neither can be explained because of an honestly held but mistaken view that an “emergency” was a permissible private expenditure category. Mr Smyth had sufficient other funds to meet these expenses. The incurring of these expenses via the union-issued credit card was not just outside the terms of the Policy. It also entailed an obvious conflict between duty to uphold the Policy and personal interest. That conflict extended to the related debiting of any amount to Mr Smyth’s loan account. In relation to this Melbourne trip and the incurring of these expenses, Mr Smyth somehow seems to have convinced himself that it was acceptable to use his union-issued credit card for any private expense, providing he paid the money back. That was not the basis upon which the credit card was issued to him as President and, as President, this ought to have been understood by him. Axiomatically, the incurring these expenses via the union-issued credit card involved a foreseeable risk of harm to the Union (and the Branch).

255    Likewise, the Melbourne airfare expense, though an expense incurred by a separate means, was wholly personal and private. Even if its booking via the Branch might be explained, as Mr Smyth stated, on the basis of custom and practice, and I am prepared to accept that it can be (and thus was not the subject of a dishonest direction by Mr Smyth in relation to the making of the booking), an expense so incurred carried with it an obligation on the part of Mr Smyth forthwith to place the Union in funds for this expense. It is to be remembered that the Policy did not apply to the AMEX card. Even so, no official exercising reasonable diligence could consider the position otherwise than that a prompt refund in full was needed. It was not, as Mr Smyth put it, a matter for reconciliation of the Branch AMEX account either by Ms Ross (who had made the booking) or by Ms Boucher, it was a matter, if reasonable diligence were exercised, for proactive identification by Mr Smyth of the amount incurred and prompt refunding to the Branch of that amount by him. This he did not do. The failure promptly to refund in full the airfare amount also involved a foreseeable risk of harm to the Union (and the Branch). Even though the incurring of the expense was explicable by custom and practice, in the absence of a prompt refund, a corresponding opportunity cost in respect of that expense was, necessarily, visited upon the Union (and the Branch).

256    As to this Melbourne airfare expense, and contrary to Mr Smyth’s submission, it is nothing to the point that looking at debits and credits to Mr Smyth’s loan account over the 2015/2016 financial year as a whole, Mr Smyth reimbursed the Union $8,246.03, whereas debits posted to the account totalled $6,709.72, a surplus of $1,536.31. The point is that by none of these credits did Mr Smyth seek promptly to refund the amount of his wife’s Melbourne airfare expense as incurred in the first instance in accordance with custom and practice.

257    What follows is that, in the incurring of each of the Melbourne accommodation expense, the Melbourne dinner expense and the Melbourne airfare expense, Mr Smyth did not act with reasonable diligence and thus contravened s 285 of the FWRO Act.

258    As to the Melbourne accommodation expense and the Melbourne dinner expense, Mr Smyth not only failed to exercise reasonable diligence by using his union-issued credit card, contrary to the Policy, to pay for these expenses but also failed to exercise reasonable diligence in promptly refunding in full the amounts so incurred. Further, the basis upon which his approved loan account with the Union (via the Branch) extended did not, on any view, extend to any debiting of that loan account with any amount, in whole or in part, of these expenses. This debiting, to the extent of $100.25, was a corollary of his absence of reasonable diligence in relation to the Melbourne accommodation expense. His misdescription of the Melbourne dinner expense had the necessary consequence that, when the Branch cleared in full its debit balance with its banker in accordance with the terms prevailing for the issued credit cards, Branch funds were, via Mr Smyth’s absence of reasonable diligence, depleted by the amount of this dinner expense and remained so depleted until, over a year later, he refunded the amount in April 2017. Mr Smyth’s lack of reasonable diligence in the way described in respect of the Melbourne airfare expense meant that he enjoyed a benefit, namely an airfare booking for his wife, without promptly putting the Branch in funds for the amount of that benefit. The terms of his loan account did not extend to any part of that expense being posted as a debit to his loan account.

259    The same conclusions reached in the preceding paragraphs as to a contravention of s 285 of the FWRO Act necessarily carry with them, in my view, having regard to the authorities discussed above, the consequence that Mr Smyth’s behaviours were not “proper” in terms of the authorities mentioned above. Neither were those behaviours in good faith or in the best interests of the Union (or Branch). In relation to the Melbourne accommodation and Melbourne dinner expenses, Mr Smyth obtained an advantage he should not have obtained. That advantage was obtaining credit, via the use of his union-issued credit card. Further, by not promptly refunding the amount of his wife’s Melbourne and return airfare, he obtained an advantage, namely credit, which he should not have obtained. It follows that Mr Smyth also thereby contravened both s 286 and s 287 of the FWRO Act.

Table A Expenses

260    The General Manager contends that the use of the credit card to incur the private expenses particularised in Table A in the annexure to the amended statement of claim constitute a single contravention. I annex to these reasons as “Annexure A” a table which lists, using item numbers which correspond with those used by the parties, the various expenditure items, the amount thereof and brief particulars concerning each expenditure. These facts, as tabulated in Annexure A, are not controversial, but are, in any event, proved by various receipts and other business records in evidence.

261    The General Manager’s consequential submission is that, if but one unauthorised use be proved, a contravention of each of ss 285, 286 and 287 of the FWRO Act is proved. I disagree. Each unauthorised use proved is a separate contravention. That is not to say that there may not thereby be revealed, in terms of any consequential need to determine penalty, a course or courses of conduct.

262    There are 79 items of union-issued credit card expenditure particularised in Annexure A. I have already dealt above with one of these expenses, the item 5 fuel expense incurred in the USA.

263    Mr Smyth’s detailed response in respect of the incurring of these expenditures is summarised in Schedule C to his written closing submissions.

264    There is no dispute that Mr Smyth incurred each of the 79 expenditure items via the use of his union-issued credit card. Fortunately, as to some of these expenditure items, it is possible to deal collectively with whether alleged contraventions are proved. “Are proved” offers an important reminder as to on whom the onus of proof of a contravention lies. It is for the General Manager to prove the contravention, not for Mr Smyth to prove he did not contravene the FWRO Act.

Incurred “in conjunction with” a Union-related expense?

265    The following expenditure items in Table A may be grouped for the purpose of considering whether contraventions have occurred: items 1, 3, 7-10, 13, 15, 16, 20, 24, 26, 28, 31, 32, 34-36, 41, 49-52, 54, 56, 58, 59, 63-69, 71, 72, 75, and 77-79.

266    On all but eight occasions, the expenditures concerned were for either or each of a non-alcoholic drink (usually a caffeinated drink or bottled water) or confectionary or a small food item (or a newspaper) incurred in conjunction with Union-related expenditure namely, expenditure on the refuelling of his work vehicle. The items were all relatively minor expenditures but, as already observed, Mr Smyth was meticulous in his recording of them on CCU forms and in retaining related receipts.

267    I shall deal separately with the other eight occasions. As for the balance falling within this grouping, it necessarily follows from the conclusion which I reached above, as to the correct construction of the Policy, that each of these expenditures fell within a permitted category of private expenditure. Further, they each fell within a permitted category of debits to his loan account. No contravention of either s 285, s 286 or s 287 of the FWRO Act is proved. Although a contravention would be proved had the expenditures not been authorised, I also in passing observe of the expenditures that they are unremarkable for a man who is expected to (and has done willingly for years) drive long distances in order to discharge his duties and thereby provide services to members of the Union.

268    Of the remaining eight, items 64 ($6.50) and 65 ($121.50) were expenses incurred at Moranbah on 1 May 2015. The occasion for Mr Smyth’s attendance there that day was not just ordinary representational duties but to participate in, and be guest speaker at, Labour Day celebrations by the Union’s (Branch’s) local Lodge. In continuance of that, Mr Smyth had dinner with some Lodge members and officers at the Moranbah Workers Club. There, as the evidence discloses, Mr Smyth purchased several meals (but no beverages, alcoholic or otherwise, I note).

269    In the proceedings, Mr Smyth has always maintained that this expense was work-related. That is so even though on the CCU form concerned he declared the total of these expenses to be a “Private part to be deducted from pay”.

270    On first impression, this might appear inconsistent. However, Mr Smyth’s explanation was that he did this to prevent “double dipping”. He adopted this practice on several occasions. What he meant by this term was that when, as with this Moranbah visit, he stayed overnight and claimed and received an overnight allowance (which compensated for meals and the like), not to declare the credit card paid for meal expense as private and for repayment would mean he would receive both the benefit of that payment as well as the benefit of an allowance which was intended to compensate the incurring of just such an expense.

271    In circumstances where the use of the credit card to incur an expense, the incurring of which is authorised by the Policy, and where such an expense is also, in whole or in part, compensated by an allowance payment, this practice is ethical and proper. It does indeed prevent “double dipping”. In relation to these 1 May 2015 incurred expenses, this practice is more than just in this sense ethical and proper. That is because, as to meals for persons other than himself, the expense was, in my view, work-related. It is impossible to think of a more important day for organised labour than May Day. The incurring by the Branch President of this relatively modest meal expense on this particular day was directed to an end beneficial to the Union.

272    Further, these additional meal expenses were never intended to be compensated by the payment of the overnight allowance. By treating them as a private expense refundable by him, Mr Smyth has assumed, personally, the financial burden of refunding to the Union an amount which entailed no “double dipping”. His disposition voluntarily to do this offers another marker in relation to Mr Smyth’s character and the depth and sincerity of his belief in trade unionism.

273    Given his role as a regulator under the FWRO Act of the conduct of officers and officials of registered industrial organisations and the context of the day and circumstances in which they were incurred, it is somewhat surprising that the General Manager perceived these, of all the expenditures, to have occasioned a contravention of that Act. However that may be, these expenses also serve nicely to illustrate how very different the context can be in which provisions found in the FWRO regulating conduct of officers and officials of a registered industrial organisations fall for application than their analogues in the Corporations Act. No contravention is proved in relation to the item 64 and 65 expenses.

274    Of the remaining six in this grouping, four expenditure items, items 3, 26, 49 and 50 were incurred “in conjunction with” accommodation expenses incurred during the discharge of Union business. Once again, having regard to the conclusion reached concerning the construction of the Policy, these private expenditures were each authorised and no contravention is proved. Indeed, these four accommodation-related expenditures incurred by Mr Smyth via his use of his union-issued credit card are completely in accordance with the example given in the Policy.

275    As to the incurring of each of these four items, and the others considered thus far under this heading, when Mr Smyth stated in evidence “whether right, wrong, or indifferent, I applied the Policy how I applied it”, his understanding and application of the Policy were exactly in accordance with its terms. As to these items, it was the General Manager’s question, and case, which was based on a false premise as to what private expenditure could permissibly be incurred.

276    Under this grouping, this leaves expenditure items 56 and 59.

277    Item 56 concerns expenditure of $6.50 at 7/Eleven, Albert Street, Brisbane. Mr Smyth’s evidence is that he was on his way to a Coal Mine Safety Advisory Council meeting, which commenced at 9.00am. His recollection, which I accept to be as accurate as honestly possible given the elapsed time, is that he purchased some water and chewing gum on his way to that meeting. There may well be an element of reconstruction in this recollection, based on a receipt and related locational details but I rather think that also prompted a memory of a familiar path and pattern. It was submitted on his behalf that this was an expense incurred which was associated with discharging his duties. Although the incurring of this expense has been declared on a CCU form, so doing does not mean it was a private expenditure authorised by the Policy. The expense was not one incurred “in conjunction with” a Union-related expense. It could not be described as “infrequent and exceptional”. It did not therefore fall within an authorised private expenditure category. Neither could the expense be described as “work related” in terms of the Policy. It was just a private expense.

278    I consider Mr Smyth’s overt disclosure of his incurring the expense to be inconsistent with dishonesty on his part in incurring the expense. Nonetheless, the Policy did not authorise the incurring “willy nilly” of private expenditure via a union-issued credit card. That was the position even though Mr Smyth’s presence in Brisbane on the day can be explained by a need to attend what was obviously a work-related meeting. The exercise of reasonable diligence by a person in Mr Smyth’s position and circumstances ought to have engendered that understanding, and a related understanding that the debiting of the expense to the loan account fell outside what was permissible. Modest though the expenditure was, to incur it via a union-issued credit card and have the benefit of a related debiting to his loan account, were pregnant with a conflict between a duty to uphold the Policy and interest in terms of private gratification. A contravention of s 285 of the FWRO Act is proved. Further, the incurring of the expense, and the related, unauthorised debiting of Mr Smyth’s loan account were not, in terms of the authorities discussed, “proper”. Contraventions of s 286 and s 287 of the FWRO Act are also proved.

279    Item 59 concerns expenditure of $50.60 at Olivia Pineda, Andergrove on 14 April 2016. Mr Smyth’s recollection, which I accept, is that this was in respect of a meal on his way home from work and that he arrived home after dark. Once again, an element of reconstruction may perhaps be involved but in observing him I thought it rather more likely that his memory was prompted by the amount and locational particulars with the resultant evidence being his honest best after the lapse of time. His evidence and related submission were that he was entitled to, but did not claim, a meal allowance.

280    It is, for reasons already given, clear enough that the expenditure cannot be regarded as an informal, underclaimed overnight allowance. That allowance includes provision for meal expenditure. Not only was there no claim for such an allowance but, even had there been, there was no entitlement to that allowance, because no overnight stay away from home was involved. It was not a return home “after dark” allowance.

281    But the meal allowance eligibility to which Mr Smyth pointed had a different source. Clause 23.1 of the Agreement incorporates from the Black Coal Mining Award 2010 (Award) “[a]ll other terms and conditions of employment not provided for in this contract”. At the time, clause 17.8 of the Award was concerned with “Meal breaks during non-rostered overtime”. It provided:

(a)    If an employee is required to work more than one and a half hours past their rostered shift (exclusive of crib time) then the employee will, unless agreed otherwise, before starting this overtime be allowed at least 30 minutes for a meal without deduction of pay.

(b)    The employee will also, unless notified the previous day of the requirement to work overtime, be supplied with a meal or paid meal allowance (see Schedule A.8.3 and Schedule B.3.2).

282    At the time, the Award meal allowance was $14.85.

283    The General Manager put, and it is a fact, that Mr Smyth had never claimed such a meal allowance. Consequentially, it was submitted that it could hardly have formed the foundation for a belief, at the time when the expenditure was incurred, that the incurring of the expense was an informal way of receiving such a meal allowance. I agree.

284    That is not to say that I accept the General Manager’s submission that Mr Smyth had no entitlement to such an allowance.

285    One submission was that, incorporating as it did provision for meal expenses, the overnight allowance was exhaustive of meal allowance entitlements. That is not so. The overnight allowance is directed to specific circumstances. It should not be construed, and it makes no industrial sense to construe it, as excluding any entitlement to a meal allowance which might arise from other than duty overnight away from home.

286    Another submission made by the General Manager was that, even if incorporated by reference, the allowances in the Award schedules were expressed to apply to specified classifications only (Schedule A to “production and engineering employees” and Schedule B to “staff employees”). But, with respect, such an approach to the interpretation of the Agreement does violence to the authorities discussed above concerning this subject, as well as to the like, well-known and frequently cited with approval observations of Madgwick J in Kucks v CSR Ltd (1996) 66 IR 182. To paraphrase those observations, narrow or pedantic approaches are misplaced. Like sentiments are also to be found in Amcor Ltd v Construction, Forestry, Mining and Energy Union (2005) 222 CLR 241, at [2] per Gleeson CJ and McHugh J, at [96] per Kirby J and at [128] per Callinan J.

287    Of course, one is not going to find in a schedule in the Award “Branch President” or the like. The whole point of incorporating, to the extent it is not inconsistent, the Award is that, by taking up office in the Union, a person is not going to lose the benefit of, materially, allowances which would be theirs had they stayed in a calling governed by the Award. Thus, for the purposes of the Agreement, one reads the provisions in the Award incorporated by reference mutatis mutandis. So read, Mr Smyth had an entitlement to be paid a meal allowance “if required to work overtime”. That was so even if that did not entail an overnight stay.

288    It was then put on behalf of the General Manager that there was no evidence that Mr Smyth was required to work overtime. Once again, there is no merit in this submission. Part and parcel of incorporating the conditions of the Award by reference is that they are rendered applicable, materially, to an official who, though given nominal standard hours, is in effect, his own boss as to the hours he works (and undertakes related travel) on a given day. As President, Mr Smyth is the paradigm example of such an official. If he chooses to work more than his standard hours, he is, as the term is incorporated by reference into the Agreement, “required to work overtime”. Overwhelmingly, the evidence is that Mr Smyth regularly did this, and did it willingly.

289    However, this “right” in terms of dedication to representational duties and the very considerable work-related travel that regularly entailed does not mean there was no “wrong” in the incurring of the item 59 expenditure. It was private expenditure. It fell outside categories of private expenditure permitted by the Policy. Reasonably, there was no basis for considering it otherwise. That is so even if, in some inchoate way, Mr Smyth considered it a meal allowance. It was more than the permissible allowance.

290    But I do not consider Mr Smyth regarded it as an informal equivalent. Behind the fact of the absence of any claims for such a meal allowance is, I consider, another feature of Mr Smyth’s character. He was not disposed to claim every allowance he conceivably might. But somehow, he just seems to have got into his head that this type of expenditure via the union-issued credit card was permissible under the Policy. He was not trying to hide it. It was declared on his CCU form. I consider that it was honestly incurred. But the conception of entitlement was negligent. For a person in Mr Smyth’s position and circumstances, it did not manifest the exercise of reasonable diligence. It thereby entailed a contravention of s 285 of the FWRO Act via the incurring of the expenditure and the benefit obtained by a related, unauthorised debiting of his loan account with the amount of the expenditure. These same features also prove impropriety in terms of the authorities discussed above. Thus, I also find that, via the incurring of the expenditure and the benefit obtained by a related, unauthorised debiting of his loan account with the amount of the expenditure, Mr Smyth also contravened s 286 and s 287 of the FWRO Act in relation to item 59.

291    In respect of expenditure items 3, 8, 9, 10, 14, 19, 25, 37, 42, 43, 46, 48, 55, 56, 61, 62, 63, 64, 65, 66, 76 and 77 it was also put by and for Mr Smyth that these were declared “private to pay” because he claimed an overnight allowance for work, and otherwise it would be “double dipping”. I have already given an example of how this could be so when referring to the item 64 and item 65 expenses.

292    I consider the near-contemporaneous, unqualified annotation on the CCU form concerned to be the most reliable explanation of Mr Smyth’s conception of the expenditure. I consider the related declaration on the CCU form exhibits honesty on his part. But it does not follow from this that, to the extent that an expenditure item falls outside the Policy, it was an exercise of reasonable diligence to incur the expense.

293    It was not a feature of the Policy, and it could not, in my view, with reasonable diligence be regarded as a feature of the Policy, that it authorised the incurring of private expenditure in lieu of claiming a particular allowance which would compensate in whole or in part the incurring of such expenditure. True it is that, in some instances, a permissible category of private expenditure via the union-issued credit card might overlap with what is covered by an allowance or, though private, be incurred “in conjunction with” Union-related expenditure.

294    A paradigm example of the former is offered where, during an overnight stay, a meal at a motel restaurant is paid for at the same time as accommodation. However, save in circumstances such as those highlighted by the items 64 and 65 expenses discussed above, or where Mr Smyth’s consumption of food and drink occurred during the course of a working dinner or meeting with others who also consumed food and drink for which payment was made via the credit card, that would not mean that the meal paid for via the union-issued credit card was other than private expenditure. It would just mean it was authorised private expenditure.

295    Further, the Policy did not authorise the writing off of what would otherwise be a related debit to a loan account because, or to the extent that, no overnight allowance was claimed. In any event, there is no evidence any such practice was followed either by Ms Boucher as Finance Manager or otherwise.

Mantra on Queen – item 43

296    Item 43 is a non-itemised expense incurred by Mr Smyth via his use of his union-issued credit card at Mantra on Queen, Brisbane on 25 January 2016. I accept that Mr Smyth was on Union business in Brisbane that day. He claimed an overnight allowance for his attendance in Brisbane. Initially, Mr Smyth’s position in dealing with the Commissioner via his solicitors was that this expense was most likely for room service, based on credit card details which the hotel had on record. But I have no evidence from Mr Smyth, even in his oral evidence, that he stayed at Mantra on Queen, let alone that the expense was for room service. If he did, a room service expense might perhaps be one incurred in conjunction with a work-related accommodation expense and authorised by the Policy. All that I have is a proved, prima facie unauthorised, private expense (and related unauthorised debit to his loan account). Even allowing for s 140(2) of the Evidence Act, I consider contraventions of ss 285, 286 and 287 of the FWRO Act are proved in relation to the incurring of this expense.

“Work related” because “related” to performing duties?

297    Expenditure items 11, 12, 14, 18, 19, 22, 23, 27, 29, 30, 37, 38, 44, 45, 57, 73, 74 and 76 were in respect of food or drinks (or both) which Mr Smyth purchased either at work (including away from his home base of Mackay on duty), or in transit to or from a work-related event. Once again, I consider that Mr Smyth’s contemporaneous annotation of “private” to be inherently more reliable than any evidence given years after the event as to the occasion for the expenditure. That is quite aside from the defence pleading contortions which the General Manager understandably highlighted in submissions.

298    These expenses fell outside the terms of the type of private expenditure authorised by the Policy to be incurred via the use of the union-issued credit card.

299    The item 12 expense, entailing the sum of $15.30 spent on 27 September 2015 at Bloomsbury Rural, at Bloomsbury on the Bruce Highway, offers an example of this category of card incurred expenditure. The items purchased comprised food and a non-alcoholic beverage. That same day, at Home Hill, Mr Smyth expended via his union issued credit card the sum of $9.89 in the purchase of water and a caffeinated drink (item 13), but that expenditure was incurred in conjunction with his purchase of diesel fuel there. Mr Smyth’s evidence was these expenditures were incurred in conjunction with a return home to Mackay after undertaking work-related duty. It was put for the General Manager that there was an element of reconstruction in this. However, I rather thought that Mr Smyth’s memory of the journey was prompted by the locations. None of that in any event diminishes the reliability of his “Private” annotation.

300    It may seem odd that during the one journey, a beverage purchased at one location was authorised but another beverage purchase, on this occasion with food by coincidence, was not authorised under the Policy. However, this flows from the wording of the private expenditure exemptions in the Policy. That is so even that, in 2015, 27 September fell on a Sunday and even though I accept, based on Mr Smyth’s evidence, that it is more likely than not that the item 12 expenditure was incurred on his way home from duties in Townsville.

301    Item 11 (an expense of $24.98 at BP/Puma, Moura garage on 20 September 2015 for food and a non-alcoholic beverage) is another such Sunday expense, which I also accept was incurred on the way home to Mackay from duties in Central Queensland.

302    Mr Smyth’s overt declaration of the item 11 and 12 expenses, and his accurate contemporaneous characterisation of that expense as private, evidence honesty in the incurring of the expense in my view. I add that that he undertook return journeys on a Sunday from Union duties away from home is one manifestation of what I am well-satisfied on the whole of the evidence to be a characteristic devotion to his duties by Mr Smyth. But neither that devotion nor more pertinently that Policy authorised treating the union-issued credit card as a source of an informal, discretionary meal allowance or in lieu of claiming a meal allowance.

303    The item 11 and 12 expenses were not “infrequent and exceptional”. Further, I am not satisfied that the item 11 and 12 expenditures were incurred “in conjunction with” Union-related expenditure. The distinguishing feature of the item 5 expenditure, which was also an isolated expenditure, was that the fuel purchased fuelled the vehicle hired at Union-expense to convey Mr Smyth to a work-related conference. It was incurred “in conjunction with” the continued operation of the very vehicle which was the subject of that car hire expense. That type of feature was not present in relation to the item 11 and 12 expenses. These expenditures and related loan account debits therefore gave rise to contraventions of ss 285, 286 and 287 of the FWRO Act.

304    Save for items 30 and 76, like conclusions readily follow in respect of the other expenditure items in this category.

305    Items 30 and 76 present quite a dilemma. I do not doubt Mr Smyth’s evidence that his duty related travel schedule, and that of other officers or officials of the Union, sometimes meant that he and they could not conveniently meet at, for example, the Branch’s Mackay office, as opposed to, for example, at a café with each then heading off in different directions on Union duties. Item 30 (a $4.75 expense incurred on the afternoon of Saturday, 12 December 2015 for coffee at Gloria Jeans, Mackay) and item 76 (a $10.05 expense incurred on the afternoon of 4 June 2016 for coffee and cake at Gloria Jeans, Mackay) look to be examples of this. I accept that each of these was a working meeting. However, Mr Smyth accurately classified this expense as private on the related CCU form. Each expense looks to have been in respect of items he alone consumed. However, the authorised private expenditure categories in respect of the union-issued credit card did not extend to such private expenses (and related loan account debit). Thus, contraventions of ss 285, 286 and 287 of the FWRO Act are proved.

306    There were other occasions, detailed below, when Mr Smyth also used his union-issued credit card to pay for food or beverages during a working meeting of one sort or another, but the expense was not just for him but also for another or others at the same meeting. At first blush, it seems odd that the lesser expense is wholly private and not authorised by the Policy, but a greater expense is work-related and therefore authorised by the Policy. However, the difference between the two is that, in the former category, Mr Smyth was just incurring an ordinary expense of life, food or beverage consumption, whereas in the latter category, and however informally, he was hosting a work-related meeting in which it was in the interests of the Union that the meeting occur during a meal shared with another or others. Further, as explained below, in the latter case the private component referable to Mr Smyth was incurred “in conjunction with” a Union-related expense.

307    Earlier on the same day as the item 30 expenditure, Mr Smyth had purchased a cup of coffee for $5.50 at McDonald’s Mackay (Item 29). I accept his evidence that this expense was incurred during a journey out to Moranbah to attend the Moranbah North Lodge Annual General Meeting, as I do that the afternoon expense was one incurred on the way back from this meeting. It is an unremarkable experience of life that coffee or another caffeinated beverage might assist with driver alertness during a longish road journey. But the expense is still a private one, even though the journey is on duty and one is to perform duty at the destination. It seems likely that a meal allowance was payable in respect of the time Mr Smyth spent on that Saturday. Even if such an allowance were payable, that did not carry with it any ex officio authority just to incur on the union-issued credit card a private expense for which a meal allowance would be compensatory in whole or in part. Having regard to the authorities discussed, I conclude that the incurring of these two expenses (Items 29 and 30) and the related, consequential debiting of the amounts to Mr Smyth’s loan account were not acts of reasonable diligence on his part. Expediency and reasonable diligence are not to be equated. The General Manager has thereby proved a contravention of s 285 of the FWRO Act. Further, in that these actions evinced an unauthorised assumption of authority to incur the expense and a consequential loan account debit, they were not, in the sense discussed in the authorities, “proper”. The General Manager has also proved contraventions of s 286 and s 287 of the FWRO Act.

308    Item 74 should receive more detailed explanation. It is a dinner expense (the receipt is so annotated) in the amount of $17.20 incurred by Mr Smyth on 30 May 2016 at the Tieri Hotel, Tieri prior to his driving back to his home in Mackay. I accept his evidence that he arrived home after dark and that he neither claimed an overnight allowance nor a meal allowance. For reasons already given, there was no entitlement to the former but it is likely he had an entitlement to the latter. Mr Smyth’s evidence, which I accept, was that he had driven out to Carborough Downs for a meeting about an enterprise agreement which lasted from about 9.00 am to 2.00 pm and that, thereafter, he had driven to Tieri. There, he had dinner with members of the Oaky Creek Lodge about a “Black Lung” event. Against this background, the item 74 expense is similar to the item 30 expense. As already stated, the Policy did not authorise Mr Smyth informally to pay himself a meal allowance. Further, the expense remained private even though he discussed Union business with others during his meal. And that remains the case even though, as seems likely, Mr Smyth extended his time away from home that day to optimise his ability to undertake representational duties during that day and at the price of undertaking extended hours of duty and incurring the potential hazards of a late return drive. For like reasons to those already given in respect of this type of expense (and the related debiting of his loan account), the General Manager has proved contraventions of ss 285, 286 and 287 of the FWRO Act.

309    My conclusion in respect of item 22 (expenditure of $101.50 at Nick’s Seafood Bar, Sydney on 1 November 2015) should also be explained further. I accept Mr Smyth’s evidence that this was in respect of his attendance at a working dinner meeting with members of the Union’s Central Council while he was in Sydney. From his evidence, the dinner looks to have been an extension of a more formal meeting that took him to Sydney for that purpose. I also accept that Mr Smyth may well have had an entitlement to, but did not claim, an overnight allowance. On 10 November 2015, Mr Smyth sent an email to Ms Boucher instructing her to deduct the cost of the dinner from his next pay. Neither in this email nor otherwise is there an indication that Mr Smyth paid for the food and beverages of others at this working dinner meeting. The expense of what he consumed himself was a wholly private expense which fell outside the terms of the Policy. For these reasons, I find the alleged contraventions of ss 285, 286 and 287 of the FWRO Act are proved.

310    Item 23, which is an unitemised expense in the amount of $56.00 incurred at Nothinfancy, Collinsville on 22 November 2015, should be considered in a little more detail. It was, I accept based on Mr Smyth’s evidence, in all likelihood incurred during a visit he made to Collinsville to discuss the transition of a mine from ownership by Theiss to Glencore. I also accept that he did not claim an overnight allowance and that, more likely than not, the reason is that he stayed with his sister. I further accept that he may nonetheless may well have been entitled to, but did not claim, a meal allowance for breakfast. However all this may be, and even though I accept the expense was honestly incurred, the General Manager has prima facie proved the expense to be a private one outside the terms of the Policy (and the related loan account debit not authorised). I therefore find the contraventions of ss 285, 286 and 287 of the FWRO Act proved.

Item 40 – the line trimmer

311    On Saturday, 16 January 2016, Mr Smyth incurred a total expense of $25.94 in respect of the purchase, using his union-issued credit card, of a line trimmer accessory for a Ryobi whipper snipper and a shovel at Bunnings, North Mackay. The two expenditure items concerned could not be characterised as falling within either of the permissible private expenditure categories. On their face, and as proved by the General Manager, these expenses just each look to be a private expense.

312    Although I accept Mr Smyth’s evidence that he did not then own such a whipper snipper, that still leaves that expense a private one outside an authorised category. Mr Smyth also referred to the uses to which both a line trimmer and shovel might be put (in terms of keeping the surrounds of a picket line area tidy, to the satisfaction of a local government). I do not doubt that this statement reflected his experience. However, that this was the occasion for the purchase of these items on this occasion by his union-issued credit card was, as he came frankly to concede, beyond his recollection. What is certain is that Mr Smyth’s contemporaneous annotation of the Bunnings receipt was “Private to pay”. That annotation is the most reliable indication of the occasion for the payment. It is inconsistent with the occasion for it being for use in relation to a picket line (which certainly would be work-related). Further, if that were the occasion for the use of the union-issued credit card, it is inherently unlikely with these particular expenditure items that Mr Smyth would have wrongly annotated the receipt.

313    Even allowing for on whom the onus of proof lies and s 140(2) of the Evidence Act, I am satisfied that the item 40 expense was wholly private and unauthorised. It likewise follows that I am satisfied that Mr Smyth had no warrant for the adding of this expense as a debit to his loan account. The exercise of reasonable diligence concerning the private expenditures authorised by the Policy should have led to Mr Smyth not using his union-issued credit card to incur the item 40 expense. He thus contravened s 285 of the FWRO Act. Incurring the expense in this way and the addition of the amount to his loan account conferred benefits on Mr Smyth to which he was not entitled. These actions were not, in terms of the authorities discussed “proper” and ought to have been understood as such by him, or any person holding his office. Necessarily, on the findings I have made, they involved a conflict between duty and interest. I therefore conclude that Mr Smyth additionally contravened s 286 and s 287 of the FWRO Act.

Item 17 – Driver’s license renewal

314    On 19 October 2015, at the Mackay office of Queensland Transport, Mr Smyth incurred, via the use of his union-issued credit card, an expense of $160.03 in respect of the renewal of his driver’s licence. There is just no doubt that an ability lawfully to drive a motor vehicle was essential to the performance of Mr Smyth’s duties as President. His evidence, “[O]ne of the key aspects of my role is driving and being able to service the membership out in the Central Highlands” was no exaggeration, just stark fact. It does not follow from this that he was authorised by the Policy to incur the expense. Prima facie, it was just a private expense.

315    The explanations as to why he used the credit card have varied. Initially, via his solicitors, the explanation Mr Smyth gave to the Commissioner was that his licence was expiring but that he could not recall why the credit card was used. That stated absence of recollection notwithstanding, it was then put that it was likely that the expense was incurred in infrequent and exceptional circumstances and was therefore permitted personal expenditure. As originally pleaded it was alleged in the defence that Mr Smyth did not know the occasion for the use of the credit card. In oral evidence, Mr Smyth stated, “I was – my licence expired on that day and I went to the Department of Transport to get my licence renewed – And on the use of my card I had insignificant insufficient funds, sorry, your Honour, on my personal card, and I used my work card.” It was put by the General Manager that Mr Smyth later accepted that he should not have used his union-issued credit card to incur the expense. However, I rather thought that the questions were premised on the General Manager’s understanding, flawed as I have concluded, as to what was permissible private expenditure under the Policy.

316    I observed Mr Smyth to be quite affected and embarrassed when he gave his answer about having insufficient funds on his personal card to meet the driver’s licence expense. His whole demeanour when giving this answer was different to what seemed like speculation in relation to the use of the union-issued credit card to pay for the Melbourne accommodation expense. It was this and the knowledge of the amount of driving the evidence disclosed he did to undertake his duties that prompted me to ask the question about the essentiality of his licence, to which Mr Smyth gave the answer already quoted. In the end, I was left with the clear impression that, giving due weight to earlier explanations in correspondence or pleadings, the truth came out in Mr Smyth’s answer as to insufficient funds. I thought the embarrassment was explanatory of his earlier absence of candour. I also noticed what I thought qualities of genuine emotion and commitment in that part of the answer concerning his being able to “service the Members”. I thus accept his explanation. That being so, in combination the imminence of a licence expiry date and insufficiency of funds occasioned the incurring of a private expenditure which was, in terms of the Policy, “infrequent and exceptional” and therefore authorised. It follows that the related debiting to his loan account of the amount concerned was within its terms.

317    For these reasons, I conclude that the General Manager has not proved contraventions of s 285, s 286 or s 287 of the FWRO Act in relation to this expense.

Conceded Contraventions?

318    Apart from expenditure item 17 (driver’s licence fee), which I do not accept was conceded, the General Manager also put that the following items had been conceded by Mr Smyth not to be authorised credit card expenditures:

(a)    purchase in July 2015 at the Mirage Hotel Starbucks Las Vegas of coffee and cake during a break at the Las Vegas conference (item 6);

(b)    purchase in the amount of $17.40 of food on 18 July 2015 from the Hub’s Wok, Fortitude Valley, Brisbane (item 42); and

(c)    car parking on Easter Sunday (27 March 2016) at Airlie Beach (item 53).

319    With respect, save for the item 53 car parking expense, that asserted concession is something of an exaggeration.

320    The Mirage Hotel was the conference venue in Las Vegas. The meal expense at this venue was private, but it was incurred “in conjunction with” work-related expenses. Mr Smyth’s attendance at this conference was authorised by the Union. Mr Smyth was paid an overseas allowance by the Union for the period from 26 July 2015 to 2 August 2015. His airfare was paid for by the Union. To the extent it was not a private deviation, the expense in journeying by road from Los Angeles to Las Vegas was a work-related expense. That being so, there was nothing untoward about Mr Smyth’s use for the purchase of his union-issued credit card; or his considering himself obliged nonetheless to pay the amount back, via treating the expense as one to be repaid in accordance with the terms of his loan account. The latter approach, given his receipt of an overseas allowance, was entirely “proper”.

321    Even if, contrary to this conclusion it was not “in conjunction with”, it was not negligent, in the circumstances of Mr Smyth’s attendance at this conference to so regard it. The answers he gave about this expenditure were:

“And can I ask why you used your union credit card to purchase that? --- I – that was in – in conjunction with work. It was at the conference at a break”. “Incidentally, what hotel was the convention at? --- It was at The Mirage at the same hotel where the – I bought the coffee and cake. That’s where they held the convention.”

322    Accepting, as I do, that the test in respect of reasonable diligence is an objective one with reference to a person holding that office in the circumstances of that organisation, I consider that it was perfectly reasonable to characterise the expense as one falling within the terms of the Policy. That being so, the related loan account debit was also one incurred with reasonable diligence. There is nothing improper in the circumstances about either the expense or the related debit. I therefore conclude that the General Manager has not proved a contravention in respect of the item 6 expense.

323    As to the item 42 “The Hub’s Wok” meal expense, I accept that Mr Smyth was in Brisbane on Union business on the day concerned. I also accept that in all likelihood, had he claimed it, Mr Smyth would have been entitled to have been paid a meal allowance that day. However, for reasons already given, the Policy did not authorise Mr Smyth informally to pay himself a meal allowance via the use of his union-issued credit card. The expenditure was private. It did not fall within the permissible categories of private expenditure for the use of his union-issued credit card. Related to that, it did not fall within the permissible categories of debit to his loan account. For like reasons to those given in respect of other such expenditures and debits, the General Manager has proved contraventions of ss 285, 286 and 287 of the FWRO Act.

324    Although not alleged by the General Manager to have been conceded, item 4, which entailed an expense of $17.40, incurred at The Hub’s Wok, Fortitude Valley, Brisbane on 18 July 2015 by Mr Smyth via the use of his union-issued credit card, evinces the same contraventions as does item 42, just considered. That is so even though, as seems likely on the evidence (and I find), Mr Smyth’s presence in Brisbane was referable to his undertaking duties here prior to his departure for the USA and could have been but was not the subject of a valid overnight allowance claim.

325    On 27 March 2016, Mr Smyth used his union-issued credit card to pay for car parking for two hours at Care Park, Airlie Beach (item 53) (not Melbourne as the General Manager’s Table A records it).

326    This expense is not, on its face, obviously work-related. That is so even though, given that Mr Smyth was based in Mackay and the District Branch office was in Brisbane, his presence in Airlie Beach may perhaps be explained by Union business. However, there is a speculative quality about this. Mr Smyth was unable to recall why the expense was incurred. Prima facie, the expense is a wholly private one. It could not be said to be either “infrequent and exceptional” or to be incurred in conjunction with a union-related expense. Accordingly, the General Manager has proved that the expense was not authorised. As so proved, Mr Smyth was negligent to use his union-issued credit card to incur the expense (and have the related benefit of an addition to his interest free debit to loan account balance). Accordingly, a contravention of s 285 of the FWRO Act is proved. Likewise, using that card to incur a private expense entailed a conflict of duty and interest and conferred benefits on Mr Smyth both immediately in terms of the meeting of a private parking cost and also via the addition of the amount to his loan account in respect of an expense that fell outside the terms of that loan account. Mr Smyth did not attempt to cover up the expense. He declared it. But absence of dishonesty is not exculpatory. Contraventions of s 286 and s 287 of the FWRO Act are also proved.

Expenditures for Union committee or other working meetings with others

327    On several occasions, Mr Smyth used his union-issued credit card to make modest purchases of food or beverages for a meeting of a Union committee or a working meeting. These were:

(a)    6 July 2015, at Crusty’s Mackay in the amount of $10.10, for refreshments (Item 2) during a District Administration Committee meeting;

(b)    1 November 2015 for food and non-alcoholic beverages in the amount of $93.60 (item 21) at Angelos on the Marina, Mackay to meet with Union colleagues prior to flying to Brisbane;

(c)    30 November 2015, at Café Mondial, Brisbane for food and non-alcoholic beverages in the amount of $97.65 (item 25) during a working dinner with work contacts;

(d)    12 January 2016, at Gloria Jeans, Mount Pleasant, Mackay for food or beverages, in the amount of $10.05 (item 39);

(e)    28 January 2016 for food and beverages at a working dinner at Blackwater Properties in the amount of $50,75 (item 46);

(f)    22 February 2016 for cups of coffee at Brisbane Marriott Hotel (item 47) in the amount of $26.90 during a meeting with Messrs Steve Woods, Jason Hill and Chris Brodsky during the USA Black Lung Experts Coal Mine Safety Council;

(g)    23 February 2016 for cups of tea and coffee at Izoo Express, Brisbane (item 48) in the amount of $11.50 during a meeting with the same persons as mentioned in sub-para (b) at the same Black Lung event;

(h)    5 April 2016 for food and beverages at Gilhooley, Brisbane (item 55) in the amount of $40.90 during a working meeting with Mr Hill in preparation for a meeting the following day of the Coal Mine Safety Advisory Council;

(i)    15 April 2016 for either beverages or food (or both – the receipt is not itemised) in the amount of $15.35 at Gloria Jeans, Mount Pleasant, Mackay (item 60) during a catch-up meeting on work issues with a Union organiser;

(j)    19 April 2016 for food and beverages at San Churro Chocolateria, Brisbane in the amount of $77.95 (item 61) during a breakfast meeting with fellow District Executive officials in conjunction with the Black Lung Rally.

328    Although both under the Rules and in practice Mr Smyth was the “public face” of the Branch and, with that, a senior official of the Union, there was no evidence that he was entitled to an expense of office or entertainment allowance. Yet there was ample evidence that Mr Smyth frequently availed himself of informal opportunities over meals to meet with local Lodge members or committees, members of committees or persons outside the Union having knowledge or duties of interest to the Union and its membership. In such informal meetings, Mr Smyth paid both for his own food or beverage, as well as those of others in attendance via a single payment using his union-issued credit card. Mr Smyth’s position was that expenses so incurred were “work-related” in terms of the Policy.

329    As to the expense at Angelos on the Marina on 1 November 2015 (item 21), a more detailed explanation is needed. Although the precise subject of the meeting is not clear from Mr Smyth’s evidence, I accept based on that evidence that it was more likely than not that it was with fellow Union colleagues and that it was a working meeting. The amount of the expense and its components are consistent with the presence of a number of persons. I accept it was convenient for Mr Smyth and participants to meet there.

330    Further detail ought also be provided as to why I have included item 25 in this category. The composition of the expenditure reveals that it was for more than one person. That is consistent with Mr Smyth’s explanation, which I accept, that the dinner was most likely a working dinner in conjunction with a Board of Management meeting which had occasioned his presence in Brisbane. It was for the General Manager to prove the alleged contraventions, not for Mr Smyth to prove the absence of contraventions. For this reason, it is not fatal that he could not recall with whom the working dinner was. It is sufficient that I am satisfied that the expense was not just for his own food and drink but in respect of a working meeting with another person.

331    It is also desirable to offer further detail in respect of item 39. This Gloria Jeans expense is non-specific as to what was purchased on this occasion but the venue and amount, together with Mr Smyth’s related evidence, which I accept, make it inferentially likely that it was for two non-alcoholic beverages, probably coffee. Mr Smyth’s evidence was that this was another of the opportunistic work meetings which it was convenient to conduct for the purposes of catching up with a colleague concerning Union-related issues. The (unnamed) person he had in mind also lived in North Mackay, near Mr Smyth. Mr Smyth related that the other attendee was probably a United organiser. He also added that it was “out of ears of anyone at work”. By this I took Mr Smyth to mean away from the Branch’s Mackay office. I do not find it at all surprising that there might be occasions when, as a senior Union officer, he considered that discretion made it more prudent to discuss a subject away from the office with a colleague and in the informality of a meeting at a café. In assessing Mr Smyth’s credibility, notwithstanding the absence of further detail in his evidence, I also took into account that he had no reason, at the time when he incurred the expense, to believe that he would be required, years later, to give greater precision.

332    The item 60 expense at this same venue looks to me to be in the same category as the item 39 expense. Further, inexact proofs by the General Manager are not sufficient to prove contraventions.

333    Item 46 also needs some further explanation. I accept Mr Smyth’s evidence that this expenditure was for items purchased at a dinner he attended with two Vice Presidents and the Branch’s in-house lawyer in relation to an attendance at Blackwater for the purposes of discussions concerning an enterprise agreement with BHP. The amount incurred looks modest in respect of the number of attendees, but the items purchased, some of which are admittedly obscured on the receipt, nonetheless look to be more than for one person alone. Against this background, the General Manager has not proved the contraventions alleged, with inexact proofs being insufficient.

334    To the extent that this category of expense was incurred in respect of the beverage or food of another attendee(s), I am well satisfied that the expense was indeed “work-related”. The Policy, with respect sensibly, does not define what is “work-related”. In context, it requires that there be a relevant relationship between the expenditure concerned and duties of the Branch official or officer to whom the credit card is issued. It is doubtless implicit that the expenditure must be lawful, but a considerable measure of discretion is consigned to the good sense, integrity and judgement of the official or officer concerned. The extent of that discretion is doubtless also a factor of the office held, if any, and in any event of the duties of the official or officer. What I mean by this is that, as the holder of the office of President, a relevant relationship with work might be more readily found in an expenditure which could be seen to have strategic benefits for the Branch, whereas that same expenditure by an employed officer of the Branch in relation to a meeting with a person whose duties or knowledge was outside that officer’s portfolio of duties would be more problematic. However, there could be no such rigid rule. It might be that the employed officer has seized a random opportunity presented to create or develop a relationship which could be seen to bring wider advantages to the Branch or the Union.

335    Further, although the functions of the General Manager extend to the institution of proceedings in respect of a contravention of the FWRO Act where reasonable cause exists, these functions do not extend to the management of a registered industrial organisation. Within the limits of the law, which includes the rules of an industrial organisation, the making of such managerial value judgements is for those who hold office under those rules.

336    Mr Smyth’s use of his union-issued credit card for this purpose was always for a relatively modest overall expense. Doubtless, anything other than modest expenditure could be regarded as a misuse of the card in terms of the Policy.

337    In relation to the component of beverage or food that was for, in this instance, Mr Smyth’s personal consumption, I consider the better view is that it was private, although I accept that it is arguable that this, too, was work-related. Construed against the background of a Branch where the Board of Management, in approving the Policy must be taken to be aware that officials and officers may use a union-issued credit card in circumstances where they would have an overnight allowance or separate meal allowance eligibility, it is more likely than not that it was not intended that the Policy would authorise “double dipping”. In any event, even though a component was private, it was, in terms of the Policy, incurred “in conjunction with” a Union-related expense (namely that of others attending the meeting).

338    A feature of Mr Smyth’s behaviour in respect of this type of expense is that he identifies the whole as private on the relevant CCU form. Where an overnight allowance is paid to him for the period in which the expense falls, this doubtless has his intended, and ethical and proper, effect of preventing “double dipping”. But this is so only to the extent of that component of the overall expenditure being referable to any food and beverage he consumes. Mr Smyth’s declaring the whole as private means that he is choosing to repay from his own funds, via his loan account arrangement, expenses which might quite properly be characterised as work-related expenses, which, to that extent, are not refundable by him. The thought of apportionment just does not seem to have occurred to him at the time of these expenses, as it did not in relation either to the USA Car Hire Expense or the related item 5 fuel expense. Looking at the whole of the evidence, I consider that this behaviour is a good indicator of Mr Smyth’s true character. He was not disposed to take any and every opportunity to benefit himself at the expense of Union funds via the use of his union-issued credit card. Instead, he has a tendency to use his own funds to benefit the Union.

339    In relation to the union-issued credit card expenses in this group, the General Manager has not proved any contravention of the FWRO Act. Indeed, “not proven”, although sufficient, might be thought to damn with faint praise. These expenses did not just evince the exercise of reasonable diligence on Mr Smyth’s part. They were authorised, incurred in good faith, ethical and proper, as were the related debits to his loan account.

340    Even if, contrary to my conclusion, there were a contravention within this group proved, I would exercise the discretion conferred by s 315 of the FWRO Act to relieve Mr Smyth from liability in relation to the incurring of these expenses (and the related loan account debits). I consider the meaning and effect of that section later in these reasons for judgement.

Café Mondial Meal 20 April 2016 (Item 62)

341    On 20 April 2016, at Café Mondial, Brisbane, Mr Smyth incurred the amount of $50.35 (item 62) via the use of his union-issued credit card in the purchase of food and a non-alcoholic beverage. He characterised this expenditure as private on the CCU form he completed. He claimed an overnight allowance in respect of his presence in Brisbane. His rationale for the declaration of the expense as private, which was ethical and proper, was to prevent what he termed “double dipping”.

342    Mr Smyth had no accurate recollection of the occasion for this expenditure. Nor, in respect of an event that he had no reason to expect at the time he would be recall years later, is there anything sinister in this. Initially, via his solicitor, his claim to the Commissioner was that this was either for dinner by himself or with his wife. In the course of his oral evidence and, I thought, candidly, he just stated that, unfortunately, he could not recall the circumstances of this expenditure.

343    Once again, although emerging from his overt declaration of the expense and his contemporaneous characterisation of it was private, I do not consider it was dishonestly incurred. Rather, he seems to have somehow got it into his head that, because (as I accept is inherently likely) he was staying overnight away from home on Union business, he was entitled to use his union-issued credit card to incur a private expense, providing he declared that and repaid the sum so as to prevent “double-dipping”. However, the terms of the Policy did not permit the incurring of private expenditure via the card in such circumstances. It was negligent on Mr Smyth’s part to consider he could so use the card and use it. Related to that, the adding of the sum to his approved loan account was outside the terms of that account. In the circumstances, the General Manager has proved a contravention of s 285 of the FWRO Act. The expenditure and debiting entailed a conflict of duty and interest and conferred an unauthorised benefit on Mr Smyth. Contraventions of s 286 and s 287 of the FWRO Act are also proved.

Items 33 and 70 – Other Usage When Personal Card Declined

344    I have already dealt above, in relation to item 17, with an occasion when Mr Smyth used his union-issued credit card in circumstances where payment by a personal card was declined. There were two others.

345    At 10.16am on Sunday, 20 December 2015, Mr Smyth purchased a loaf of bread and 30 cans of Coca Cola Diet Coke for $20.19, from Woolworths North Mackay via the use of his union-issued credit card (item 33). This location is about 10-15 minutes’ drive away from his home. Although Mr Smyth could not identify the personal card he sought first to use, I accept his evidence that he did first attempt to use a personal card to pay for the items but that this was declined.

346    I also accept that history repeated itself when at 9.17pm on Saturday, 28 May 2016, Mr Smyth purchased a two-pack Turkish Delight, a Drumstick Choc Mint and a Golden Gaytime for $11.40 from Coles Express Mackay via the use of his union-issued credit card (item 70). This location also is close to his home. Although Mr Smyth was again unable to identify the personal card he sought to use, I accept his evidence that it was declined, because it was expired.

347     The General Manager alleged contraventions because neither expenditure was authorised by the Policy (or authorised to be debited to Mr Smyth’s loan account). It was common ground that neither occasion was work related or incurred in conjunction with a Union-related expense.

348    The General Manager contended that that the expenses did not fall into the “infrequent and exceptional” category. It was put that, “There was nothing ‘exceptional’ about Mr Smyth’s desire to buy chocolate, ice-cream, bread and Coca Cola for himself on a weekend.” That is true but nothing to the point. What must be infrequent and exceptional to engage this category of private expenditure exception is, in the first instance, the occasion for the use of the union-issued credit card. Further, the regulatory provisions in question do not seize upon even that in isolation. They look to want of reasonable diligence by an officer holding the office Mr Smyth held in the circumstances, whether an act was in good faith and prosperity in the obtaining of an advantage.

349    It was also put for the General Manager that Mr Smyth had conceded under cross examination that neither occasion involved an emergency or exceptional circumstance for the purposes of the Policy. But any such concession, like others, was responsive to a cross-examination conducted on an understanding of the meaning of the Policy which I have found to be erroneous and certainly not an understanding shared by Mr Smyth. I place no weight on the so-called concession.

350    Although not unique, an encounter by Mr Smyth with insufficient funds to meet a private expense was not, on the evidence, frequent. Further, insufficiency of funds is just the type of event which, in my view, as expressed above, makes for an “exceptional” circumstance under the Policy. More to the point, I am satisfied that Mr Smyth, on each of these occasions, acted with reasonable diligence on the authorities in regarding these expenses as falling within a private expenditure category authorised by the Policy. True it is that he might just have replaced the items selected on the shelves and left, perhaps with a suitable apology to the sales staff, but I do not consider that an exercise of reasonable diligence, in the circumstances, obliged him to do that. As the expense was authorised, so too was the related debiting of the amount to his loan account. Mr Smyth made no attempt to hide his incurring of the expenses. They were declared as private on his CCU form. They were honestly incurred. Further, although the incurring of the expense and the related loan account debit conferred an advantage on Mr Smyth, they were authorised advantages. These acts were in good faith and proper.

351    In the circumstances, I find that no contravention of s 285, s 286 or s 287 of the FWRO Act is proved by the General Manager.

Authorised by Effluxion of time in any event?

352    So far as presently material, s 320 of the FWRO Act provides:

Validation of certain acts after 4 years

(1)    Subject to this section and section 321, after the end of 4 years from:

(a)    the doing of an act:

(i)    … ; or

(ii)    by a person holding or purporting to hold an office or position in an organisation or branch and purporting to exercise power conferred by or under the rules of the organisation or branch; or …

the act, election or purported election, appointment or purported appointment, or the making or purported making or alteration or purported alteration of the rule, is taken to have been done in compliance with the rules of the organisation or branch.

(2)    The operation of this section does not affect the validity or operation of an order, judgment, decree, declaration, direction, verdict, sentence, decision or similar judicial act of the Federal Court or any other court made before the end of the 4 years referred to in subsection (1).

(3)    This section extends to an act, election or purported election, appointment or purported appointment, and to the making or purported making or alteration or purported alteration of a rule:

(a)    done or occurring before the commencement of this section; or

(b)    done or occurring in relation to an association before it became an organisation.

353    Neither in these proceedings nor otherwise has the General Manager or, beforehand, the Commissioner sought an order under s 321 of the FWRO Act, by which s 320 of that Act is taken never to have applied to any act by Mr Smyth.

354    The origins of s 320 of the FWRO Act may be traced to amendments made to the Conciliation and Arbitration Act which inserted into that Act s 171F: see s 16, Conciliation and Arbitration (Organisations) Act 1974 (Cth). That amending Act also inserted an analogue of the present s 321 of the FWRO Act, s 171G.

355    The General Manager submitted that s 320 of the FWRO Act should be construed strictly and that “it would be contrary to the intended purpose of [ss 285, 286 and 287 of the FWRO Act], to guard against officials of registered organisations misusing their positions and member funds” by introducing a “stringent time limitation” by requiring that proceedings be both heard and determined within four years after an act contrary to a registered organisation’s rules. It was also put that “predecessors of s 320 have only ever been applied in administrative contexts, such as disputed union membership; disputed election to union office; ownership of union property; and reduction in Federal capitation fees”. The last of these submissions is true but that is no reason not to apply s 320 of the FWRO Act according to its terms. As to the other submissions noted, there is no warrant for construing s 320 of the FWRO Act “strictly”. Section 320 of the FWRO Act falls for construction by reference to its text, subject matter scope, context and purpose in accordance with the conventional modern approach to statutory construction. If that leads to a result which is considered disconcerting by the General Manager, it is open to the General Manager to persuade the Minister administering the FWRO Act to promote a remedial amendment to parliament.

356    It was also put for the General Manager that, “contraventions of ss 285 – 287 have been established in other cases despite the conduct giving rise to the breach having occurred more than four years prior to those proceedings being issued or findings being made”. So much may be accepted. But all that means is that, unlike in the present case, an issue concerning the meaning and effect of s 320 in the circumstances of those cases was not raised.

357    In the Full Court, there was reference, indeed repeated reference, by Besanko J (with whom Allsop CJ and White J agreed) to s 320 of the FWRO Act in Registered Organisations Commissioner v Australian Workers’ Union (2020) 281 FCR 518 (ROC v AWU), but in the very particular context, quite different from the present case, of a controversy concerning whether, in terms of s 331(2) of the FWRO Act, the Commissioner had reasonable cause to conduct an investigation. In addressing that subject, Besanko J, at [149], observed:

[It] is difficult, if not impossible, to see how a mere breach of a rule which imposes an obligation on a Union or a branch of a Union could give rise to a contravention by an officer of an obligation he or she owes to the organisation. Even the obligation of care and diligence in s 285(1) is very likely to involve something more than a mere breach of the Rules, such as a fact indicating relevant responsibility on an individual for the payments made or oversight responsibility for such payments. The problem becomes more acute for the AWU’s argument as one moves to s 286(1) (ie, good faith, best interests of the organisation and proper purpose) and then s 287(1) (ie, gaining an advantage or causing a detriment to the organisation). It is, for example, very difficult to see how a contravention of s 287(1) could be based on a breach of the Rules alone or even substantially based on a breach of the Rules. The difficulty is not overcome by the fact that the AWU did not contend that a breach of the Rules was not capable of founding a ground of contravention of s 287(1), as the primary judge put the matter. With respect, that is not really the issue. The issue is what do these circumstances suggest about whether there were matters grounding Mr Enright’s suspicion beyond breaches of the Rules? In my opinion, they clearly suggest that there were such other matters. Furthermore, as the Commissioner put it, in the ordinary case an investigation about compliance with ss 285(1), 286(1) and 287(1) “would be heavily focussed on ‘why’ the donations were made” and that is the “stuff” of the officers’ duties in those provisions.

358    The General Manager sought to make something of these observations and a related proposition that the case did not depend on whether or not Mr Smyth had complied with the Rules or the Divisional Rules. However, this reliance was misplaced. In these observations, Besanko J was developing a converse proposition, which was that it is difficult to see how a mere breach of a rule could give rise to a contravention of s 285, s 286 or s 287 of the FWRO Act. With this, I respectfully agree. Such a breach may, however, be a step along the way to proving such a contravention. The converse, however, that a contravention of these provisions may be found in conduct that is authorised by such rules does not follow. Nor does it follow that if, on its true meaning, s 320 of the FWRO Act requires that an act be taken to have been authorised by such rules that there remains a contravention.

359    Recently, in Jolly v Sharma [2024] FCA 171 (Jolly v Sharma), at [127], Snaden J described s 320 of the FWRO Act as a limitation provision. However, His Honour’s immediate elaboration of this description indicates that he viewed the provision as more than just a limitation on the commencement of proceedings:

It operates, after the expiry of the nominated period, so as to put relevantly non‑compliant conduct beyond the reach of correction.

Although I respectfully agree with that elaboration, it leaves unanswered how and why, according to its terms, s 320 puts non-compliant conduct beyond the reach of correction.

360    This answer was supplied, in my view, by statements made by Sweeney and Evatt JJ concerning the meaning and effect of s 171F of the Conciliation and Arbitration Act in their joint judgment in Egan v Harradine (1975) 25 FLR 336, at 380:

The purpose of the section is quite clearly to prevent the challenge of acts as defined after the lapse of a period of four years. The language used in the section is that the act, etc., shall for all purposes be deemed to have been done in compliance with the rules of the organization or branch. …

Section 171F goes beyond the mere question of validity of the particular act and requires that the act shall be deemed to have been done in compliance with the rules of the organization or branch. The effect of this is to go beyond the mere validity of a particular act. As we said in the ruling, the section adjudges or determines conclusively that the act was done in compliance with the rules. Its effect is that if in fact there was not compliance with the rules the section notionally alters those facts (d. Hunter Douglas Australia Pty. Ltd. v. Perma Blinds (62)).

In considering its application one must look at the rules of the organization or branch and determine from it what was required to be done to be in compliance with them for the validation of the particular act. Whatever was required by the rules for the act to be valid is then conclusively adjudged to have been done.

The effect of the section is to require the act to be deemed to have been done in compliance with rules. This involves an adjudgment that at that time there was compliance and there is a presumption of continuance which, however, in our view is rebuttable.

If there were no rules of a branch or an organization, as the case may be, then the section cannot operate. It cannot both notionally alter a set of facts so that those facts correspond with what was required by rules to be done until there are such rules. The notional alteration of fact A to fact B (of what was done to what the rules require to be done) cannot take place if there is no fact B.

361    The qualifying condition, identified by Sweeney and Evatt JJ in this passage, is an important one and remains as a feature of s 320 of the FWRO Act. That qualifying condition means that Mr Smyth’s submission that, “Taking the last of the events that are the subject of the proceedings as being the last day of the 2015/16 financial year—30 June 2016—Mr Smyth’s impugned conduct will be deemed to have occurred in compliance with the rules by 30 June 2020” cannot be accepted in an unqualified way. If there were no rules of the Union applicable to Mr Smyth’s conduct, s 320 of the FWRO Act could not operate.

362    Within the Divisional Rules, rule 9(vi)(d) confers on the District Branch Executive power, “To incur all necessary accounts and expenditure for the proper upkeep of the District Branch and to pay all sums so incurred.” The District Branch Executive is also, by Divisional Rule 11(ii), and subject to the Board of Management, given control of the property and funds of the Branch – “Subject to the control of the District Branch Board of Management and Convention the property and funds of the District Branch shall be under the control of the District Branch Executive.”

363    In this case, the Board of Management has, via the Policy, exercised control over such funds as are expended via a union-issued credit card by requiring that the expenditure be in accordance with the Policy.

364    Insofar as expenditure in this case concerns funds (Mrs Smyth’s airfare to the USA) consigned, not to the control of the District Branch, but rather to those under the control of the Division, that control is vested by the Divisional Rules in the Central Executive Council (rule 11(ii)), which enjoys a similar power to the District Branch in respect of the making of loans (rule 11(iii)(c)).

365    The Divisional Rules do grant power to make loans but subject to particular conditions as set out in rule 11(iii)(c):

Loans, grants and donations of any amount exceeding $1,000 shall not be made by the District Branch unless the District Branch Board of Management has satisfied itself that the making of the loan, grant or donation is in accordance with the Rules of the District Branch and that, in relation to a loan, that in the circumstances, the security proposed to be given for the repayment of the loan is adequate and the proposed arrangements for the repayment of the loan are satisfactory. Loans, grants and donations of an amount exceeding $1,000 shall not be made unless approved by the Board of Management.

366    As mentioned above, the General Manager’s case does not entail a challenge to the approval of the loan account facility extended to Mr Smyth.

367    With regard to the operation of s 320 of the FWRO Act, Mr Smyth put his reference to the Rules and the Divisional Rules at a rather general level of abstraction, “on its proper construction, s 320 is applicable to any instance of exercise of power conferred by the rules and operates effectively, as a time bar against any person who seeks to impugn such an exercise of power”. As can be seen, that submission anticipates statements made by Snaden J in Jolly v Sharma. That aside, the generality of the reference to Rules drew the ire of the General Manager. But the Rules and the Divisional Rules do, as indicated, concern themselves with expenditures of funds under the control of either the Division itself or the District Branch.

368    An expenditure which is not authorised by the Policy is, necessarily, an expenditure which is contrary to the Divisional Rules, because it has not been authorised by the Board of Management. However, on the face of the text of s 320 of the FWRO Act, and there being a rule which could authorise the expenditure, the expenditure concerned is taken to be authorised by those rules after the expiry of four years from the relevant act. That relevant act is the incurring of the expenditure concerned.

369    The same follows in relation to an expenditure which could be authorised by the Central Executive Council.

370    Further, in relation to additions to the loan account, a power to make loans is, as indicated, granted by the Divisional Rules. Insofar as making loans includes an addition to an existing loan facility, that power includes a power to increase a loan. Once again, four years after the relevant act, which is the making of the loan or addition to the loan account, the loan is taken by s 320 of the FWRO Act to be authorised by the Rules.

371    What follows from this, in my view, is that I am obliged by s 320(1) of the FWRO Act to conclude that each of the alleged expenditures was authorised by the Rules or the Divisional Rules and, further, that I am similarly so obliged to conclude that each addition to Mr Smyth’s approved loan facility was also so authorised. That obligation existed at the time when the proceedings were instituted on 30 November 2021, because more than four years had by then elapsed from the last of the acts alleged.

372    It is put that a contravention of ss 285, 286 and 287 of the FWRO Act may nonetheless be found. The foundation of the submission is that these provisions create statutory duties, whereas any deeming effected by s 320 of that Act concerns only compliance with the rules of a registered organisation. Where I have found contraventions, a conflict between duty and interest is evident in incurring an unauthorised expense or addition to a loan account or in obtaining a benefit, namely payment of Mr Smyth’s wife’s USA airfare in relation to which, although the booking was authorised by custom and practice, which ought promptly to have been refunded. It seems to me the difficulty with this is supplied by an observation made in the passage quoted from Egan v Harradine, “Whatever was required by the rules for the act to be valid is then conclusively adjudged to have been done.” The norms of conduct with which ss 285, 286 and 287 of the FWRO Act engage, at least in the circumstances of this case, inevitably engage with what was or was not permissible under the Rules (and the Divisional Rules).

373    It was also put for the General Manager in relation to s 320 that it would be anomalous if a mere effluxion of a short period of time precluded a contravention being found, in circumstances where ratification by the membership pursuant to s 289 of the FWRO Act of conduct which amounted to a contravention of s 285, s 286 or s 287 could not. Perhaps that is so. Further, it was always open to the General Manager (or the Commissioner beforehand) to apply for an order under s 321 of the FWRO Act to prevent s 320 applying according to its terms. Yet further, it may perhaps be that there has been an uncritical copying of Corporations Act provisions into the FWRO Act without appreciating the presence of s 320 and the jurisprudence concerning its predecessor. It may seem odd that conduct which was once a contravention of ss 285, 286 or 287 of the FWRO Act can be rendered no longer so by the mere effluxion of time. But the considerations may not be all one way in terms of drawing a line in the sand in relation to long ago conduct. The difficulties of recollection and proofs in this case demonstrate that. However all this may be, if s 320 has the meaning and effect it appears to have on its face, then that the conduct might alternatively have been ratified by members is nothing to the point. Neither is it anything to the point that there may be conduct which once might have been seen to be a contravention of s 285, s 286 or s 287 of the FWRO Act occurred. It is the constitutional function of the judicial branch to give effect to the text of an Act validly made by parliament and to leave to parliament the correction of any perceived anomaly: Gauntlett v Repatriation Commission (1991) 32 FCR 73, at 77, and Ralph v Repatriation Commission (2016) 248 FCR 438, at [56].

374    My conclusion concerning the meaning and effect of s 320 of the FWRO Act means that the proceedings must be dismissed.

Relief from liability?

375    In the event that my conclusion as to the meaning and effect of s 320 of the FWRO Act is in error, it is necessary to deal with Mr Smyth’s alternative submission that he ought, pursuant to s 315 of the FWRO Act, be relieved wholly or in part from liability in respect of such contraventions as I have found he committed.

376    I have already referred above to authorities concerning an analogue provision in the Corporations Act. As is revealed by ASIC v Australian Property Custodian, at [68], three issues are usually raised in relation to whether there should be any such statutory relief in a Corporations Act case:

(a)    whether the applicant for relief has acted honestly;

(b)    whether having regard to all the circumstances the applicant ought fairly to be excused; and

(c)    whether the applicant should be relieved from liability wholly or in part, and if partly, to what extent.

377    There is nothing in s 315 of the FWRO Act which would suggest that it gives rise to any different issues. However, like ss 285, 286 and 287 of the FWRO Act, s 315 falls for application in circumstances different to those of its Corporations Act analogue.

378    In Daniels v Anderson (1995) 37 NSWLR 438, at 524, Clarke and Sheller JJA stated, in relation to that Corporations Act analogue:

The purpose of this section is to excuse company officers from liability in situations where it would be unjust and oppressive not to do so, recognising that such officers are business men and women who act in an environment involving risk and commercial decision making.

379    At a more general level of abstraction, in Edwards v Attorney-General (NSW) (2004) 60 NSWLR 667, Young CJ in Eq observed, at [76], of the Corporations Act and its predecessor that, “the purpose … was for permitting the economy to be advantaged by such entrepreneurial ventures with limited liability and to regulate the rights of members inter se, the rights between and creditors of corporations”.

380    These statements serve to emphasise how different the context is in which s 315 of the FWRO Act falls for application. That context includes, but is not exhausted by, a purpose which I identified at the outset of these reasons in relation to trade union legislation. One purpose is to render a combination of workers who have objects which might otherwise be an unlawful restraint of trade lawful. Other purposes may readily be discerned from the statements in s 5 of the FWRO Act concerning parliament’s intentions in enacting the Act.

381    Registered organisations can only act via their officials and other officers. Section 315 of the FWRO Act thus requires a balance to be struck between facilitation of the achievement of the statutory purposes mentioned and holding delinquent officials or officers liable for conduct which contravenes s 285, s 286 or s 287 of that Act. As with the Corporations Act analogue, s 315 does not authorise the Court to set aside lightly such contravening conduct: Re Wave Capital Ltd (2003) 47 ACSR 418, at [29].

382    I have already identified under the heading “Expenditures for Union committee or other working meetings with others” a group of expenditures in respect of which, even if I were wrong in concluding entailed no contravention, I would relieve Mr Smyth from liability in respect of a contravention of ss 285, 286 and 287 of the FWRO Act. Each of these expenditures was honestly incurred. Each, even if wrong headed in its incurring, was directed solely to the furtherance of the interests of members of the Union and its objects. Further, although it is a distinction without a difference, each was directed to facilitating the operation of the workplace relations system (s 5(5), FWRO Act). Informal sharing of knowledge and experience about industrial relations and workplace health and safety issues is a key element of this facilitation. Either or each of these qualities can be seen to have motivated the incurring of these expenses. That being so, if there were any contravention, Mr Smyth ought wholly fairly to be excused (with this extending to each and any contravention arising from a related debit to his loan account).

383    Beyond this are cases where Mr Smyth could have claimed a meal or overnight allowance but did not, instead choosing just to incur a meal expense via the use of his union-issued credit card. Again, each such use was honest. In some cases, as with minor expenses incurred on long drives to or from representational duties remote from his home base of Mackay, whether or not the expenditure fell within or outside the Policy turned on nothing more than whether he additionally purchased, at the same time, fuel for his work vehicle. The work-related end to which such a journey or other presence away from his home base differed not at all in such cases. I regard items 4, 11, 12, 22, 23, 30, 59 and 74 as falling within this category (as also do the related debits to his loan account). It seems to me that it would put unfairly put form over substance not to relieve Mr Smyth from liability in respect of these expenditures and related debits to his loan account.

384    I do not see that the circumstances of any other expenditures or any related loan account debits warrant relief from liability pursuant to s 315 of the FWRO Act.

Outcome

385    For the above reasons, the proceedings must be dismissed.

Associate:    

Dated:    28 March 2024

ANNEXURE A