Between: FEDERATED ENGINE-DRIVERS AND FIREMEN'S ASSOCIATION OF AUSTRALASIA
And: BROKEN HILL PTY CO LTD

Judges: Griffith CJ
Barton J
O'Connor J
Isaacs J

Higgins J

Subject References:
Industrial law
Conciliation and Arbitration
Meaning of 'industry'
Organizations
Registration
Employee association
Registration
Effect of
Whether evidence of existence of dispute
Whether municipal corporation exempt from federal legislation

Legislative References:
Conciliation and Arbitration Act 1904 (Cth) No 13 - s 4; s 21; s 40A; s 55; s 57

Judgment date: 27 June 1911

SYDNEY

Judgment by:
HIGGINS J

My answer to the first question is "Yes." The Act does not refuse to recognize, as an organization for its purposes, great unions such as the Amalgamated Society of Engineers, having members who get employment in all kind of employers' undertakings throughout the world. Nor does the Act refuse the boon of arbitration in cases where the employers, in dispute with employees of a certain craft, do not happen to be carrying on undertakings of the same character.

The answer depends on the meaning of the Act: there is no difficulty under the Constitution. Parliament could, indeed, at any time put its intention beyond all doubt; but we have to deal with the Act as it stands. I am not surprised that the words used have created a difference of opinion in this Court, for the draftsman has had occasion to use the word "industry" much more frequently in the sense of the undertaking of the employer than in the sense of the calling or occupation of the employee. The circumstances in each case dealt with in the sections happened to require the former sense; and the difficulty arises from the effort of the framers of the Act to make the one word "industry" carry the burden of two very distinct meanings.

The word "industry," in relation to employers in s. 55 (1) (a), and elsewhere, I shall assume for the present to mean their industry in the sense of business or undertaking. But what is the meaning of the words in s. 55 (1) (b), "any association of not less than one hundred employees in or in connection with any industry"? It is said that this means that the association must be confined to men, often of very diverse callings, engaged in some kind of (employer's) undertaking. That is to say, the engine-drivers of a big undertaking, such as the Broken Hill Proprietary, must, if they want the benefit of the Act, join an association in which miners, truckers, timbermen, wheelwrights, smelters, plumbers, carpenters, etc, are members, and cannot join with other engine-drivers, doing the same kind of work in timber yards or mills. Being few in number, the engine-drivers would be lost in the crowd of members of other occupations, and would probably find their interests ignored. "Birds of a feather flock together"; but it is not to be so with unions under this Act, according to the argument of the respondents. It is not engine-drivers only who will suffer if the respondents succeed, but societies such as the Amalgamated Society of Engineers, the Federated Carters and Drivers, the Federated Wood Workers, the Shop Assistants' Federation, the Sewerage and General Labourers' Association, the Amalgamated Society of Carpenters and Joiners, the Australasian Society of Engineers, the Federated Clerks' Union-all already registered under the Act. In Great Britain such unions are well recognized; and also such unions as the Associated Blacksmiths, the United Patternmakers, etc; but it is urged the federal Act is to be treated as excluding them. There is certainly no indication in the Act of any intention to cut so violently into trade union practice, to interfere with the freedom of voluntary association for the betterment of industrial conditions. According to s. 2 one object of the Act is "to facilitate and encourage the organization of representative bodies of employers and of employees ... and to permit representative bodies of employers and of employees to be declared organizations for the purposes of this Act." Prima facie, this includes any kind of representative body of employees, includes "craft unions," and the burden of proof lies on those who assert that there is any exclusion of craft unions under the other provisions of the Act.

I concur with my learned brother O'Connor in his opinion that under the word "industry," in the interpretation section, are included not only undertakings (of the employers) but also callings or occupations (of the employees). We ought to give the words "trade," "calling," "service," "employment," their full meaning unless there is something in the context which prevents us; and we ought to assume that Parliament had, at the least, such knowledge as is common property as to the modes of unionism. It is quite true that we should correctly speak of a master cutler's "trade;" but we also speak of a journeyman cutler's "trade." We may speak of an engineer's "calling"; but equally of a journeyman engineer's "calling." We speak, it is true, of a postal service, or a carrying service; but much more frequently of a labourer's service, a waiter's service. We may say that a man has employment as a builder; but it is, at the very least, equally appropriate to speak of a clerk's employment. The rest of the words in the clause are also appropriate, for in the "trade" of journeyman plumber, in the "calling" of moulder, in the "service" of waiter or labourer, in the "employment" of clerk, "persons are employed for pay." Then the exception comes which proves the rule; "excepting only persons engaged in domestic service," etc There is no force in this exception unless Parliament meant to exclude from "service" domestic service; the exception implies that under the earlier part of the clause ordinary domestic servants, whose employers may have no business undertakings of any kind, could be treated as constituting an industry.

I take it that the Act meant industrial workers on both sides to associate themselves as they thought best; subject, however, to the power of the Registrar to refuse to register an association if there is already an organization to which members might conveniently belong (s. 59); and subject to the Court's power to cancel the registration "for any reasons," as well as for certain specified reasons (s. 60). The draftsman had in his mind the wide definition of "association" in s. 4-"any trade or other union ... or any association or body composed of or representative of employers or employees, or for furthering or protecting the interests of employers or employees." He had to limit the class of associations to be registered so as to exclude, for instance, an association so vague as the Friends of Humanity, or the Workers of the World, and so as to confine registration to associations connected with some definite industrial operations. Moreover, I do not think that sufficient attention has been given during the argument to the words "in or in connection with" any industry. Even assuming that "industry" is to have the narrow meaning of an employer's undertaking only, so that it refers only to some undertaking of one employer, or common to several employers, it does not follow that this association cannot be registered. An association of miners is "in" the mining industry; but an association of engine-drivers, or of fitters, is "in connection with" other industries. The object of the words was, to my mind, obviously to provide that the association must have some definite connection with some concrete industrial operations in which are to be found the relations of employer and employed. If the contrary view is correct, an engine-driver who happens to get employment for a short time in a pickle factory cannot be in the same organization as an engine-driver in a jam factory, though they are doing precisely similar work.

Perhaps I ought to add that, in my opinion, the words added by amendment in the Act of 1910-"and includes a branch of an industry"-do not affect the question. If "industry" meant only an employer's business, it means so still. The amendment would probably allow the engine-drivers who happen to be for a time in flour mills to form a separate organization of their own; but it would not allow the engine-drivers who happen to be in a soap factory to join in an organization with engine-drivers who are temporarily next door in a candle factory.

As to the second question: Assuming that s. 55 does not allow of the registration of this association, I concur with my learned brothers, but with doubt, in the opinion that the objection is fatal, even when the case comes on for hearing. The Court has no cognizance of the dispute unless an "organization" submit it, under s. 19 (b); and although the association has been in fact registered in this case, it is an association which-if the respondents' contention is right-is incapable of being an organization. At the same time it must be admitted that the result is very unfair to the claimant union. This union simply followed the practice of the Registrar, who admitted many other such craft unions. It was registered more than three years ago; and none of the respondents applied to the Registrar, or to the Arbitration Court, although they could have so applied, to have the registration cancelled. On the faith of the registration the union has spent much money and great labour with the view of keeping the men working and of having the disputes settled by the Court; and now, when an award is ready, it is told that the Registrar should not have registered. However, my answer to question two must be "Yes."

The questions which are put actually arose in the course of the concrete case before me, and are, in my opinion, questions of law (see s. 31); and as such they ought, I think, to be answered by the High Court judicially. The consequences of the answers will be for me, as President of the Court of Arbitration, to determine-subject, of course, to the Constitution and the Act, and to such controlling power as is vested in the High Court.

The third question compels the consideration of all that difficult doctrine, propounded by Marshall C.J. in the United States, as to the implied exemption of federal and of State "instrumentalities." In a former case I have ventured to express my scepticism as to the soundness of the doctrine; for I think that in M'Culloch v Maryland ^[F45] the principle of necessary implication has been extended far beyond logical limits, at all events beyond the limits set by British law (Baxter v Commissioners of Taxation (N.S.W.), ^[F46] at p. 1164. The whole doctrine of exemption of "instrumentalities" rests on inference; and the inference becomes more and more difficult as the activities of the State increase. How can one say that business undertakings of the State were meant to be exempted by a Constitution framed in 1789, at a time when no one dreamt of such undertakings? In the South Carolina Case ^[F47] the Supreme Court of the United States seems at last to have found the necessity for some limitation of the doctrine; and probably some such line of demarcation as was found in that case will have to be adopted in Australia. But, although this question was submitted by me to the Court, I admit that it would be better not to answer it at present-not to answer it unless we can answer it fully. It would be well, first, to give an opportunity to the States and to the Commonwealth to be heard; and to have the facts more precisely set forth as to the undertakings of the several respondents affected. I am all the more inclined to this course, as the answer to the question may involve the validity of certain amendments made by the Act of 1910 in the interpretation section.

My answer to the fourth question is, "No." The questions, Is there a dispute? and Does it extend beyond one State? have been raised in nearly every case that has come before me in the Arbitration Court, and from the first. I quite recognize that the existence of the dispute, and its extension, are conditions precedent to the exercise of the jurisdiction of the Court, and I have hitherto spent much time and care in taking full evidence from all sides on the issue. But the position becomes different, now that I understand from my learned brothers that my findings on the issue must be regarded as irrelevant on prohibition or mandamus proceedings, and that even the evidence taken by me cannot be used except by consent. I shall, of course, regard it as my duty not to proceed with an arbitration if it is clear from the first that the conditions as to jurisdiction are not fulfilled; and also to demand some evidence showing a prima facie case of jurisdiction. But, as to such evidence as I take, I am of the opinion that s. 25 applies, and that by virtue of the amendment, if not of the original section, I am not bound by any rules of evidence.

My answer to the fifth question is, "No." The Act seems to have been drawn under the idea that the existence of a dispute was a matter easy to be proved; but the fact of its extension beyond one State would need some inquiry, and might be left to the Registrar, for a prima facie finding. In my opinion, the certificate of the Registrar under s. 21 is merely evidence that, assuming a dispute to exist as to industrial matters, it extends beyond one State.

The sixth question, unfortunately, has not been argued as it deserves to be argued-probably because the claimants rely on s. 40 (A). In the Bootmakers' Case ^[F48] I inserted certain provisions as to a Board of Reference. The provision which was attacked by the respondents in that case was a provision exempting certain employers from complying with the provisions of my awards as to the contents of apprenticeship deeds. My award dealt with boys employed and to be employed, the dispute being as to "the regulation of boy labour," without any qualification. No one urged before me that existing apprentices were not to be dealt with, that their grossly unfair position was not to be rectified; but it was held by the Full Court that I had no power to deal with existing apprentices, as they were not within the ambit of the dispute if properly construed. It was also held, however, that even assuming that I had power to deal with existing apprentices, I had no power to delegate power to a Board of Reference to "annual" an existing indenture. Now, what I provided was that full adult wages were to be paid to all except ( inter alios ) those lads who were indentured as I prescribed, or who were indentured in a manner approved by a Board of Reference. I did not create, or "appoint" any Board of Reference, but I stated what kind of Board of Reference, voluntarily appointed by the parties, could give the approval on which exemption would follow. It is obvious that the Board of Reference was not given power to "annul" any indenture, but was enabled to exempt indentures from annulment-if "annulment" is the proper term. It was a provision purely in the interests of the employers, allowing a dispensation in certain cases from the general rule. It was as if I gave a direction that all lads who passed a certain examination at a university were to be excepted from the rule. In such a case, there would obviously be no delegation of discretion; the direction would be mine, and the discretion exercised would be mine. Under the Act, the Court of Arbitration has power (s. 38 (b)) "to make any order or award or give any direction in pursuance of the hearing or determination;" and (s. 38 (u)) "generally to give all such directions and do all such things as it deems necessity or expedient in the premises." The direction contained in my proposed clause is that any decision of a question arising out of the award, if given by a Board of Reference, voluntarily constituted by both parties, should be binding on the parties by virtue of my award; as if a committee, empowered to settle the conditions of racing, were to prescribe that the decision of the judges is to be final. The truth is that the duty of the Court "to settle a dispute" resembles far more the duty of a Court of Chancery to "settle a scheme" for the conduct of a charity, than the duty of a Court of common law in an action for debt or damages. The Court of Arbitration does not award payment for violation of existing or past rights, but prescribes a system of relationship for the future. It has never been suggested, so far as I know, that a Court of Chancery, in committing to a board of trustees of a charity the function of selecting boys for a school, or inmates for a benevolent institution, is thereby delegating its powers. The doubt which occasioned question 6 was occasioned by the language of the majority of the Court in the Bootmakers' Case, ^[F49] at pp. 32, 46 as to delegation of authority to a Board of Reference. I did not think it was delegation; but, if it is-and the Full Court held it to be a delegation-how can Parliament, when creating a tribunal in pursuance of its power under the Constitution, enable the tribunal to delegate any authority to another body? As I have said, this question has not been argued. My duty is to express my opinion in the affirmative as to question 6, except that the words "or respecting any other matter of their industrial relations" must be excised. I inserted these words in the proposed award-words which are often, and wisely, put in agreements and State awards-merely in the hope of eliciting the opinion of the Full Court on the whole subject, and of finding the precise limits of my power.

I do not think that the express power to "appoint" a Board for all Australia, now contained in s. 40A, operates to withdraw such powers as were already contained in the original Act, under provisions which have not been repealed.