BANK OFFICIALS' ASSOCIATION (SOUTH AUSTRALIAN BRANCH) v SAVINGS BANK OF SOUTH AUSTRALIA

32 CLR 276
1923 - 0606A - HCA

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(Judgment by: HIGGINS J)

Between: BANK OFFICIALS' ASSOCIATION (SOUTH AUSTRALIAN BRANCH)
And: SAVINGS BANK OF SOUTH AUSTRALIA

Court:

Judges: Knox CJ
Isaacs J

Higgins JRich J
Starke J

Subject References:
Arbitration
Industrial Court of South Australia
Jurisdiction

Legislative References:
Savings Bank Act 1875 (SA) - the Act

Hearing date: 6 March 1923; 7 March 1923; 8 March 1923
Judgment date: 6 June 1923

MELBOURNE

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Judgment by:
HIGGINS J

A claim was made on 16th November 1920 by the Association on the Savings Bank in a dispute as to wages and other conditions of service of the officials. The Deputy President of the Industrial Court held a conference of the parties under s. 11 of the Industrial Arbitration Act 1912 on 6th and 9th December; and then referred the claim to the Court. The Bank contends that the Court has no power to make any award binding on the Bank. If this view is right, the Bank is not entitled to the benefit of the efforts of the President or Deputy President to reconcile the parties in conference, or subsequently in the Court; and, according to counsel for the Bank, even the provisions forbidding strikes do not apply to strikes of the Bank officials.

There was a new Act repealing the Act of 1912, passed on the same 9th December-the Industrial Code 1920; but under s. 3 of the Code "any proceeding which at the passing of this Act is depending in any Court, or before any wages board or other authority, may be proceeded with, heard, and determined ... under this Act." Counsel for the Bank contend that the provisions of this Code apply to the proceedings in this case. I think that the contention is right; at all events, I shall deal with this case on the assumption that it is right.

The Bank relies on the provisions of its special Acts as exempting it from the provisions of the Code; but counsel for the Bank admitted before the Supreme Court that, but for the special Acts, the words of the Industrial Arbitration Act of 1912 were wide enough to cover this dispute.

Under the Savings Bank Act of 1875, the Bank is managed by trustees appointed by the Governor in Council, and the trustees are incorporated under the name of the Savings Bank of South Australia. Under s. 7 the trustees shall, as occasion may require, "and subject to the approval of the Governor," appoint all such officers, etc, as to them shall seem necessary for efficiently conducting the business; and also subject to such approval, pay and allow to such officers, etc, such salaries as to the said trustees shall seem reasonable, and from time to time remove any officer, etc I assume in favour of the respondent, that the power to remove is also subject to the like approval. Section 8 empowers the trustees to declare any officer to be on the fixed establishment so as to be entitled to a retiring allowance, and invalidates any assignment of the allowance. Section 10 empowers the trustees to grant leave of absence up to three weeks per annum; s. 11 empowers them to grant leave of absence for a longer term to officers who have been for ten or twenty years on the fixed establishment; s. 12 makes the decision of the trustees final as to retiring allowance or leave of absence. Section 13 empowers and requires the trustees to make general rules respecting the transactions and business of the trustees and officers, and for the government and management of the Bank, and for the guidance, control and information of all agents, clerks or other officers, and of depositors, for carrying the Act into execution. Every such rule has to be signed by five trustees, certified by the Attorney-General to be not repugnant to law, approved by the Governor, and laid upon the table of each House of Parliament; and, if not disallowed by resolution of either House within one month, the rule is to have the same force as if inserted in the Act. Under s. 48, "subject to the conditions hereinbefore contained, the said trustees are hereby authorized and empowered to pay and discharge the salary," etc, "of every officer," etc, "employed by them, under the authority of, and in the discharge of the duties imposed by, this Act, and all other expenses, allowances, and incidental charges which shall necessarily attend the execution of this Act, out of the funds of the said Savings Bank." This is, of course, a mere empowering clause; but it will be noticed that it empowers the trustees to pay the salary of every officer employed by them under the Act, as well as all other incidental expenses. The power is "subject to the conditions" contained in the preceding sections; and, so long as the approval of the Governor has been obtained to the amount of the salary, the trustees have power to pay that salary.

The Industrial Arbitration Act 1912 created a Court with jurisdiction to settle industrial matters as between employers and employees; but the Full Court of South Australia has held that the Act does not apply to the Savings Bank as an employer. It bases its decision on two principles of construction-

(1)

that the Crown is not to be treated as bound except by express words or by necessary implication; and

(2)

that an earlier particular Act ought not to be treated as repealed by a later general Act except as aforesaid: Generalia specialibus non derogant.

As to the Crown, no notice seems to have been taken of another principle of construction-that "where an Act of Parliament is made for the public good, the advancement of religion and justice, and to prevent injury and wrong, the King shall be bound by such Act, though not particularly named therein" (Bacon's Abridgment, 7th ed., vol. VI., p. 462); and that the objective of these industrial Acts fits this description. For the present purpose, opinions may differ as to success or desirability of these Acts, but success or desirability is not the test. Questions are continually arising between employers and employees as to wages and conditions of employment, questions which lead to the suspension of business; and the King is entitled to the benefit of such machinery, whether it be conciliation or arbitration or any other device, as Parliament provides for the purpose of doing justice and of securing continuity in the operations of undertakings.

Then, again, the distinction has to be borne in mind between the King exercising his "primary and inalienable functions of government," and the King carrying on a business or industry. In holding that the Government of New South Wales was bound by the provisions of the Employers' Liability Act as to Government employees, the late Griffith C.J. quoted with approval Craies, 2nd ed., p. 377:

"Saying that the rights of the Crown are not barred by any statute which does not name them does not mean that the King, looked upon as a mere individual, may not be in certain cases deprived by statutes, which do not specially name him, `of such inferior rights as belong indifferently to the King or to a subject ...; what it does mean is that the King cannot in any case whatever be stripped by a statute, which does not specially name him, `of any part of his ancient prerogative, or of those rights which are incommunicable and are appropriated to him as essential to his regal capacity' " (Sydney Harbour Trust Commissioners v Ryan, ^[F16] at p. 365).

This carrying on of a bank cannot, in any sense, be put in the same category as "the administration of justice, the maintenance of order, and the repression of crime" (see per Lord Watson in Coomber v Justices of Berks, ^[F17] at p. 74). In Farnell v Bowman, ^[F18] at p. 649 the Judicial Committee warned us of the care necessary in applying principles as to Crown exemption within the colonies, where the Governments embark so frequently in undertakings which in other countries are usually left to private enterprise. There is another consideration to which I called attention in the case of the Amalgamated Society of Engineers v Adelaide Steamship Co, ^[F19] at p. 163-the consideration that from the very nature of the case industrial disputes and matters cannot be effectively handled if the greatest employer in Australia cannot, though actually a party to the dispute and interested in the matter, be subjected to the operations of the Courts.

But, even assuming that the Crown is not bound by the Industrial Act, I take a view which, to my mind, is one of the simplest and most obvious. The Industrial Code, even if it extends to these officials, does not bind the Crown or affect the Crown's powers in any way. These officials are not servants of the Crown: they are servants of the trustees. Under s. 7 of the Savings Bank Act 1875 the trustees appoint officers subject to the approval of the Governor; and subject to that approval they pay the salaries. It is for the trustees to appoint and to propose the salary; the Governor can merely interpose his veto. That veto is not disturbed by the Industrial Code. The Industrial Court prescribes, e.g., the minimum wage at which certain employees may be hired or kept in employment. If the trustees want to have such employees, and the Governor does not want to have them at the award rates, they cannot be employed. The same deadlock would arise if the cost of living rose very high, or if, as during the late war, employees became very scarce; for, if the trustees proposed to pay wages sufficient to attract employees, the Governor would have power to withhold his approval from such wages. It is the trustees that the award would bind-not the Governor. The position is similar as to s. 13. The trustees make general rules; and I assume that the rules may prescribe the hours of work and other conditions (s. 5 does not, as alleged, relate to hours of employees). The Governor can refuse his approval to any such rule drawn up so as to conform with an award, or a House of Parliament may disallow the rule. The result is that the trustees cannot employ the officers required without breach of the award; but there is no interference of the Industrial Court with the veto of the Governor. The point to be borne in mind is that the Industrial Court merely prescribes that if any persons are employed or retained in employment they must be employed or retained under certain conditions: it does not order any employer to employ or retain any one. There would now be two bodies with power to veto-the Governor and the Industrial Court; and if both bodies cannot be obeyed the officers concerned cannot be employed. The position is similar as to existing officers. If, for instance, an award be made fixing the minimum salary for bank tellers at PD300 per annum, and the Governor has hitherto approved of PD250 as the salary of some existing teller, that teller cannot be paid more than PD250 without breach of the Bank Act; and he cannot be paid less than PD300 without breach of the award. Under s. 47 (1) (d) of the Code, the award prevails over any contract of service in force at the coming into operation of the award, and the contract has to be construed as modified to conform to the award. So it would seem that the teller must leave the service if the Governor should refuse his approval to the payment of the minimum salary prescribed by the award. The position would of course, be awkward if such a deadlock arose; but there is no ground for saying that the Code interferes with the Governor's right of veto. I cannot take the view put by the learned Chief Justice of South Australia that the Governor's approval of existing salaries is deprived of effect, or his power to disapprove of future salaries nullified, by the Code.

As for the maxim Generalia specialibus non derogant, there is, in my opinion, really no more ground for treating the Bank Act as special and the Industrial Act as general, than for treating the Bank Act as general and the Industrial Act as special-if we look at the very special object of the Industrial Act. The Bank Act deals with the business of banking, on the assumption that employees can be procured at such wages and on such conditions as the trustees (with the approval of the Governor) prescribe. The Industrial Act deals with the special case of differences or questions arising as to the terms of employment, and provides for the regulation of industrial matters with the obvious view of securing industry against stoppages and disturbances. The provision that the jurisdiction of the Court or of the President over an industrial matter shall not depend upon the existence of a dispute (s. 5, "industrial matters" (3)) does not involve a corollary that the prevention and settlement of disputes or differences is not one of the objects of the Court. The definition of "industrial matters" in s. 5-e.g., "matters or things affecting or relating to work done or to be done"-must include such matters if in dispute; ss. 19 and 20 allow the President to "mediate"; ss. 99 and 100 forbid strikes and lock-outs; and s. 104 forbids picketing. The Industrial Act deals, therefore, with a different subject matter from the Savings Bank Act, a special matter with which the Savings Bank Act is not concerned at all.

But even if we are to treat the Savings Bank Act as special and the Industrial Act as general, there is nothing in the former Act that is prohibited by the latter. No one has attempted to point out any particular in which if one Act be obeyed the other Act must be disobeyed. Both Acts can be obeyed; there is no repugnancy or even inconsistency between them; there is nothing struck out of the earlier Act, expressly or by implication. Section 34 of the Code, providing that the Crown may intervene in the Court to make representations in the public interest, is quite consistent with the provisions in the Bank Act for the approval of the Governor in Council as to salaries, etc The position is analogous to that of a special Act for the constitution of a particular gas company, and a general Act regulating the quality of gas supplied by all gas companies, and the charges that may be made for the gas; there is not in either case any "derogation" or repeal of the special by the general. The Courts, on the principle of Generalia specialibus non derogant, try, if possible, to treat the rule laid down by the special Act as an exception to the general rule contained in the general Act, where the provisions conflict. The principle as expressed by Lord Selborne in Seward v Vera Cruz ^[F20] is:

"Where there are general words in a later Act capable of reasonable and sensible application without extending them to subjects specially dealt with by earlier legislation ... that earlier and special legislation" is not to be held "indirectly repealed, altered, or derogated from merely by force of such general words, without any indication of a particular intention to do so."

But here the Bank Act has not dealt at all, either specially or generally, with disputes or differences or questions between the Bank and its employees.

If the language of Lord Selborne in the Vera Cruz Case ^[F21] be carefully examined, it will be seen that he applies his rule to cases where the same subject is dealt with in the earlier Act as in the later Act; and here the subject of the later Act is radically different from that of the earlier. The subject of the earlier Act was the institution of a Savings Bank for the people, with incidental provisions for State control of the expenditure; the subject of the later Act was a novel expedient for promoting industrial peace, continuity of business operations and the easing of the economic pressure on the workers. The language of Lord Hobhouse in Barker v Edger, ^[F22] and of Viscount Haldane in Blackpool Corporation v Starr Estate Co, ^[F23] responds to the same test. These learned Judges would not, I feel sure, apply their rule to an earlier Act constituting a particular gas company, and a later Act regulating for all gas companies the quality of gas and the price to be charged.

But, after all, these maxims merely afford presumptions; and we must not let them obscure our sight of the goal, which is the meaning of the later Act in relation to the earlier. The primary rule as between successive Acts is that earlier legislation must give way to later-Leges posteriores priores contrarias abrogant; and the rule Generalia specialibus etc is treated as a qualification of that primary rule (see Craies, 2nd ed., pp. 337 and following). These maxims merely aid us in taking our bearings in the movement of our reason; and if we come to the conclusion after a thorough survey that this Industrial Code was meant to apply to all banking businesses as well as to the other industries, to subject them to the devices for conciliation and arbitration and restraint of strikes which the Code provides, we must give effect to that intention, whatever presumptions are afforded by the maxims. This was the reasoning applied in In re Williams; Jones v Williams. ^[F24] In that case, the manager of a Savings Bank died insolvent, owing the bank moneys which he received in his capacity as manager. The Savings Banks Act 1863 gave the Bank priority as to such a debt. But the Bankruptcy Act 1883 provided that, in distribution of the property of a bankrupt, taxes, wages, etc, should be payable in priority, and subject thereto all debts proved in the bankruptcy should be paid pari passu. It was held that the Bankruptcy Act prevailed over the provision in the Savings Banks Act. As Craies points out (p. 340) the rule of Generalia specialibus etc "must not be pressed too far"; and this view is supported by the numerous cases which follow this statement. See in particular the striking case of the Blenheim estates of the Duke of Marlborough (In re Duke of Marlborough's Parliamentary Estates ^[F25] ) - where it was held that, notwithstanding the stringent provisions against alienation in Act 5 Anne c. 3, the general Settled Land Act 1882 enables the estates to be alienated. The effect of the general Act must, of course, depend on its nature as shown by its language; but in this Code the note of universality of application is prominent throughout. By Division III. of Part II. the Court has jurisdiction to deal with all industrial matters pursuant to that Part, as well as all industrial matters submitted to it by certain parties, and jurisdiction over any industrial matter as to which a conference has been held (as here). By s. 5 "industrial matters" means matters or things affecting or relating to work done or to be done, or the privileges, rights or duties of employers or employees, or of persons who intend or propose to be employers or employees, in any industry, not involving questions which are or may be the subject of proceedings for an indictable offence. This express exception tends to negative an exception as to the Savings Bank officials. "Industry" means an occupation in which persons of either sex are employed for hire or reward in any business, or calling carried on by way of trade or for purposes of gain (except agriculture-again the express exception tends to negative other exceptions). "Employer" means any person or corporation employing one or more employees in any industry; and "employee" means any person employed in any industry. Why then, should we imply any exception as to employees of this Savings Bank? I should prefer to rest my conclusion on this broad ground; but I have sought to show that even on the narrower ground the conclusion is well justified.

But I pass on now to the new argument raised before us, and not before the Supreme Court, that the Industrial Code does not, even if these principles of construction are ignored, empower the Industrial Court to deal with industrial disputes or matters affecting such business as that of the Savings Bank at all. The Bank in the Supreme Court did not dispute that the word "industry" in the Industrial Act is wide enough to include the business of this Bank; but the parties then assumed that the Industrial Arbitration Act 1912 applied to this case; and if the Industrial Code (of 1920) applies, the matter is certainly not so clear. I ought to say first that if under the previous Act the proceedings in conference and in Court as to this Bank were permissible, they would seem still to be permissible under the Code (s. 3 (1); s. 3 (2), II., III., V.; s. 3 (4)); and that there is no indication of any deliberate intention to narrow the jurisdiction of the Court. But now I shall examine the definitions in the Code. Under s. 17 (1) the Court shall have jurisdiction over any "industrial matters" as to which (c) "a conference has been held under s. 20, and which, not having been finally and completely dealt with or settled at such conference, the President has referred to the Court." Under s. 5 "industrial matters" means matters or things affecting or relating to work done or to be done or the privileges, rights or duties of employers or employees or of persons who intend or propose to be employers or employees in any industry. Again, under s. 5 "employer" (a) means any person, firm, company, or corporation employing one or more employees in any industry, whether on behalf of himself or any other person; and (b) includes several bodies-the Public Service Commissioner, the Railways Commissioner, the Metropolitan Abattoirs Board, any District Council, the Fire Brigades Board, the Council of any Municipality-and "any other person, firm, company, or corporation, in respect of whom both Houses of Parliament pass a resolution approving their inclusion in this definition." These words of "inclusion," being mere words of inclusion, do not narrow the "meaning" of the previous words; and the Savings Bank is an employer in an industry if the definition of industry fits it. Now, "industry" is defined in a subsequent part of s. 5:

"'Industry'

(a)

means craft, occupation, or calling in which persons of either sex are employed for hire or reward -

(I.)

in any business, trade, manufacture, or calling carried on by way of trade or for purposes of gain (except agriculture); or

(II.)

by any employer referred to in paragraph (b) of the definition of `employer' " (above).

What the Savings Bank carries on is clearly a business; it is spoken of as a business several times in the Savings Bank Act; for instance, s. 7 speaks of "efficiently conducting the business of the said Bank.' Moreover, the business is carried on for purposes of gain. Under s. 30, depositors are to be paid interest "out of the net profits of the said Bank.' The trustees of the Bank may lend the moneys deposited on mortgage (s. 37), or on Government or municipal securities (s. 38). They must prepare a balancesheet annually (s 41), and annually set apart any necessary sum but not exceeding one-fifth part of the net profits towards a reserve fund, until the reserve fund amounts to 4 per cent. of the deposits; and thereafter the trustees must annually divide among the depositors at certain rates, "and the balance not so divided shall stand to the credit of profit account, and be carried forward to the profit of the following year" (s. 42). It is true that there are no shareholders; but the Act does not say that the purpose must be gain to shareholders. The institution was formed for the gain of the depositors from the first, as appears from the original ordinances of 1847:

"Whereas it is desirable, for the encouragement of frugality, that persons possessing small sums of money beyond what they require for the supply of their immediate wants, should be afforded an opportunity of depositing the same on good security, to accumulate at interest, and to form a provision for themselves and families."

In my opinion, therefore, the Code of 1920 as well as the Act of 1912 applies to this Savings Bank. I may add that even if the words of the definitions in s. 5 of the Industrial Code were at all ambiguous, it would be our duty to presume, from the absence of any clear indication to the contrary in the Code, that the Legislature in codifying the law did not intend to exclude institutions which before the Code were subject to the powers of the Industrial Court.

In my opinion, the appeal should be allowed, and the order of the Supreme Court set aside.