Jumbunna Coal Mine No Liability v Victorian Coal Miners' Association

6 CLR 309

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(Judgment by: Griffith CJ)

Jumbunna Coal Mine No Liability
v.Victorian Coal Miners' Association

Court:

Judges:
Griffith CJBarton J
O'Connor J
Isaacs J

Legislative References:
Conciliation and Arbitration Act 1904 - The Act
Trade Disputes Conciliation and Arbitration Act 1892" (NSW); - The Act
Conciliation Act 1894" (SA) - The Act
Conciliation Act 1896 (England) - The Act
Industrial Conciliation and Arbitration Act 1900 (WA) - The Act
New South Wales Act 1901 (No 59) - s 7

Case References:
United States v Fisher - 2 Cranch 358
McCulloch v Maryland - 4 Wheaton
United States v Reese - 92 US 214
D'Emden v Pedder - 1 CLR
Illinois Central Railway Company v McKendree - 203 US 514
Grenada County Supervisors v Brogden - 112 US
Marshall v Grimes - 41 Miss 27
Nicol v Ames - 173 US 509
Buttfield v Stranahan - 192 US 470
United States v Coombs - 12 Pet 72
Perth Local Board v Maley - 1 CLR 702

Hearing date: 12, 15-19 June 1908
Judgment date: 6 October 1908

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Judgment by:
Griffith CJ

The main question for determination in this case is whether, as incidental to the power to make laws with respect to "conciliation and arbitration for the prevention and settlement of industrial disputes extending beyond the limits of any one State," the Commonwealth Parliament can constitute new corporate bodies within the States, and confer on them such powers as Part V of the "Conciliation and Arbitration Act" purports to confer. The answer to the question requires a careful consideration of the language of the Constitution and of the Act itself. The grant of the power in question is strictly limited by its express terms. The dispute must be one "extending beyond the limits of any one State." It does not, therefore, extend to purely domestic or municipal disputes. Again, the power, so far as regards the prevention of disputes, is limited to conciliation for that purpose. It does not, therefore, extend to making laws for what is called "collective bargaining," except so far as collective bargaining may be incidental to such conciliation or to arbitration for the settlement of existing disputes. An industrial dispute exists where a considerable number of employés engaged in some branch of industry make common cause in demanding from or refusing to their employers (whether one or more) some change in the conditions of employment which is denied to them or asked of them. The form of combination is immaterial, though it most commonly arises where there are organised associations of employés or employers. The degree of permanency of the combination is also immaterial, but there must be some continuity of action.

It is contended for the appellants that the term "industrial dispute extending beyond the limits of any one State" imports, of itself, that there must be on both sides of the dispute parties whose operations are carried on in more than one State. This, of course, includes the case of a single employer having employés in more than one State, who combine together in a dispute with him. It is conceded for the Registrar that this condition must exist on one side of the dispute, but he contends that it need not exist on both sides, and that if a combination of workmen or of employers operating in more than one State makes a common demand against separate employers or bodies of workmen in different States, those in one State being willing to accede to the demands and those in the other unwilling, there is nevertheless a dispute extending beyond the limits of one State. This is a difficult question which may some day arise for decision, but it is not necessary to decide it in this case.

Another question which arises at the outset is -- What is an "industrial dispute" within the meaning of the Constitution? It must, of course, be a dispute relating to an "industry," and in my judgment the term "industry" should be construed as including all forms of employment in which large numbers of persons are employed, the sudden cessation of whose work might prejudicially affect the orderly conduct of the ordinary operations of civil life. The term "extending beyond the limits of any one State" must connote the same idea in connection with both prevention and settlement. In the case of settlement of a dispute, the dispute must be one already extending beyond the limits. In the case of prevention, there can only be danger of such an extension. It follows that the dispute must be in its nature such that it is likely to extend, or at least capable of extending. This, however, does not throw much light on the question, since a dispute might arise in any industry whatever which in fact was carried on upon the border between two States, and would for that very reason be likely to extend from one to the other.

The word "settlement" connotes that the dispute to be settled is already existing. The power to legislate with respect to arbitration for the settlement of a dispute necessarily involves, in my opinion, power to make provisions for constituting an arbitral tribunal, for bringing before it the parties to the dispute, and for enforcing the award of the tribunal. In the exercise of this power, and to attain these ends, the Parliament is unfettered in its choice of means, provided that they are really incidental to the attainment of these ends, and not manifestly unconnected with them. There must be some nexus between the means and the end. I will return to the question of what might primá facie be such means, but will first say a few words on the power to legislate with respect to conciliation for the prevention and settlement of disputes. In this case, ex vi termini , any notion of compulsion is excluded, so that it cannot be incidental to conciliation to make any change in the existing rights or capacities of any person or body of persons, except by creating agencies through which the function of conciliation may be the better exercised. These considerations apply, whether the conciliation is for preventing a dispute from coming into existence or for bringing it to an end. Arbitration, on the other hand, can only relate to an existing dispute. It was suggested, but not pressed, that the settlement by arbitration of an intrastate dispute might be a means of preventing the extension of the dispute beyond the limits of the State. This contention would involve the consequence that any domestic industrial dispute whatever would fall within the power, since it might possibly under some circumstances extend beyond the State -- a consequence inconsistent with the retention by the States of the exclusive power to deal with the regulation of their own internal trade, and which would give no effectual meaning to the words "extending beyond the limits of any one State." What means, then, may be regarded as incidental to bringing together for the purpose of conciliation parties between whom an industrial dispute is likely to arise or has already arisen, or incidental to bringing parties before the tribunal of arbitration for the purpose of settlement of an existing dispute and enforcement of the decision of the tribunal?

It is plain that communication with all the individual disputants or probable disputants would be impracticable for either purpose. It would, therefore, be expedient, and indeed necessary, to make provision for representation. And I can see no reason why the Parliament should not provide that existing State organisations, representative of bodies of employers or employés, should be recognised as representative for the purpose of the law which they pass to deal with the matter. Nor can I see any reason why they should not authorise the constitution of new organisations for the specific purposes of the Act. And they might confer upon such organisations of either kind such powers as are incidental to the discharge of these functions. They might, if they thought fit, prescribe that any such organisation should be disentitled to act as a representative body unless it gave security in money or in the form of property for obeying the decisions of the tribunal. But, beyond such limits, it seems to me that they could not go in this respect. The Parliament has no independent power to create corporations except in the cases specified in s 51, pl. XIII. (banks), and possibly in s 51, pl. XX. And since the powers and functions of every corporation are limited by its constitution, it follows that the Parliament cannot confer upon a corporation created by it powers or functions for the exercise of which alone it could not create a corporation. It could, however, I think, create a corporation as a means to the execution of an express power, and confer on it such powers and functions as are incidental to the execution of that power. This is the accepted doctrine under the Constitution of the United States.

I pass now to the provisions of the "Conciliation and Arbitration Act," on which the appellant's objection is based. That objection takes two forms -- (1) That the Act authorises the creation of corporations which cannot from the nature of their powers and functions be parties, or representatives of parties, to an industrial dispute within the meaning of the Constitution; (2) that it purports to confer upon all corporations of which it authorises the creation, powers and functions which have nothing to do with conciliation or arbitration for the prevention and settlement of industrial disputes within that meaning, and that these provisions are so inseparably connected with the rest that they cannot be severed, with the consequence that the whole of the provisions must be held to be ultra vires . Whether this objection can be sustained depends in part upon the construction of the words of the Act itself, and in part on the question whether the powers and functions in question can be regarded as incidental to conciliation or arbitration for the prevention or settlement of industrial disputes.

Part V of the Act deals with "Organisations." s 55 provides that any of the following associations may be registered as an organisation: -- ( a ) Any association of employers in or in connection with any industry, who have in the aggregate, throughout the six months next preceding the application for registration, employed on an average taken per month not less than one hundred employés in that industry; and ( b ) any association of not less than one hundred employés in connection with any industry. The term "association" is defined by s 4 as "meaning" "any trade or other union or branch of any union or any association or body composed of or representative of employers or employés or for furthering or protecting the interests of employers or employés " s 55, therefore, authorises the recognition, in addition to trade unions and other unions, of a new legal entity, described as "any association or body composed of or representative of employers or employés, or for furthering or protecting the interests of employers or employés " s 58 provides that every registered organisation shall, for the purposes of the Act, have perpetual succession and a common seal. This is the accepted formula for creating a corporation. A question was raised as to the meaning of the words "for the purposes of this Act." But, remembering that the functions and powers of every corporation are limited, I think that these words may be read as meaning that corporations so constituted shall have the powers and functions conferred by the Act. The section goes on to authorise these new corporations to hold real and personal property.

Read literally, s 58 incorporates every trade union upon its registration as an organisation. The Act also, to some extent, regulates the internal management of such corporations, quá corporations. Whether a trade union can at one and the same time both be a corporation under the Act and also not be a corporation, quá trade union, is an interesting and novel question. Possibly it is analogous to the case of a corporation sole. If the Federal law is valid, it must prevail over State law, with the result that a body of persons associated under a State law and not incorporated under that law, can, on the pretext that it may some day become a party to a proceeding under this Act, be registered as an association, and so become a corporation which the State must recognise as such, with apparently no power to dissolve it or regulate it. Whether the corporation would die on the dissolution of the State-created body, I do not know.

It was strenuously contended for the appellants that the competence of the Parliament to create representative organisations or corporations, as incidental to the execution of the power in question, was limited to organisations or corporations representing the employers or employés of more than one State, and I was for some time disposed to attach weight to this argument. But in the case of an industrial dispute in actual existence, and extending beyond the limits of a State, it is not unlikely that the parties to the dispute on one side would be organisations of different States in temporary alliance for the common purpose, and in such a case it would be convenient that the court should be able to call them before it. The recognition, or even the creation, and the registration, of such bodies may, therefore, be fairly considered as incidental to the power to make laws with respect to arbitration. It was contended also that conferring upon such corporations the capacity to hold land is not a matter incidental to that power. It was answered that it is desirable that such corporations should hold property to answer orders and awards made against them. I am not at all impressed by this argument, but I think that the right to hold property is primá facie incidental to all corporations lawfully created. I do not think, however, that a corporation created by the Parliament can hold land or any other property except for the limited purposes for which it is incorporated. If s 58 purports to confer a general authority to hold property to any extent for any purpose, I think that it is pro tanto ineffectual. But I think that this excess is severable, and does not vitiate the main provisions to which it is incident.

I pass to the other objection, which is, to my mind, much more serious. s 55 (2) enacts that the conditions to be complied with by associations applying to be registered as organisations shall be those set forth in Schedule B, which provides that the affairs of the association must be regulated by rules providing for a variety of matters, some of which are foreign to the primary objects of trade unions, one being the manner in which industrial agreements may be made by or on behalf of the association. Part VI. of the of the Act relates to such industrial agreements. This part of the Act is -- I think unfortunately -- based on the model of Statutes which were in force in some of the States and in New Zealand, and which were passed by Legislatures of plenary authority, free to deal with other matters than those to which the competency of the Commonwealth Parliament is limited. s 73 provides that any organisation may make an industrial agreement with any other organisation for the prevention and settlement of industrial disputes by conciliation and arbitration. The following sections, 74 to 81, contain detailed provisions as to such agreements and their effect. I have already expressed my view of the meaning to be attached to the word industry. The terms "industrial agreements" and "industrial disputes" must have a corresponding meaning. The Act, however, defines the term industrial dispute as meaning

a dispute in relation to industrial matters ... . extending beyond the limits of any one State including disputes in relation to employment upon State railways or to employment in industries carried on by or under the control of the Commonwealth or a State or any public authority constituted under the Commonwealth or a State but it does not include a dispute relating to employments in any agricultural viticultural horticultural or dairying pursuit.

And it defines the term "industry" as meaning

business trade manufacture undertaking calling service or employment on land or water in which persons are employed for pay hire advantage or reward excepting only persons engaged in domestic service and persons engaged in agricultural viticultural horticultural or dairying pursuits.

The appellants contend that this definition of "industry" includes callings and employments which are of such a nature that an "industrial dispute," as the term is used in the Constitution, cannot arise in respect to them, and that ss 55 and 73 must be construed accordingly as extending to employments in which an "industrial dispute" is impossible, either from their nature or from their strictly localised operation. They further contend that the term "industrial dispute" as defined, having regard to the definition of that term itself and to the definition of "industry," includes disputes which are not industrial disputes within the meaning of the Constitution, ie , extending beyond the limits of one State. As was pointed out in Barger's Case , 14 ALR 374, and the Trade Marks Case , 14 ALR 565, the Parliament cannot, either by means of a definition or otherwise, extend its powers beyond those conferred by the Constitution. If, therefore, these terms as used in the Act include matters not within the power, any provisions relating to such matters are to that extent invalid. Whether that invalidity affects the whole enactment is another question. The definition of "industrial dispute" is on its face intended in one particular to include disputes which are outside the ambit of power of the Parliament, as was decided in the Railway Servants' Case , 13 ALR 273. If the definition of "industry" includes forms of employment which are not within the competence of the Parliament, the provisions of the Act are, no doubt, pro tanto invalid, as was decided in that case. But, after some doubt, I have come to the conclusion that this does not affect their validity as to matters within their competence. So far, therefore, I think that this objection fails.

I think, also, that s 73, read according to the plain meaning of the words used, means that any registered organisation may make an industrial agreement, using that term in the widest sense, with any other registered organisation, for any of the purposes mentioned in Part VI., and this whether the subject-matter of the agreement does or does not extend to operations beyond the limits of one State. I have already pointed out that the power of the Commonwealth Parliament does not extend to general legislation for the prevention of industrial disputes, but only to conciliation for that end. s 73, however, authorises agreements for such prevention. It may be that industrial agreements, such as s 73 purports to authorise, would be conducive to preventing industrial disputes from arising, and would in that indirect way conduce to preventing them from extending beyond the limits of any one State. If this be so, and if the power to authorise such agreements had been conferred on the Parliament, it might be argued that industrial agreements between purely intrastate organisations, would be justifiable as having a preventive tendency. Whether this would be a proper inference or not, I think that s 73 is based on that view, and that its plain language purports to authorise such agreements, whether they do or do not relate to an existing or prospective industrial dispute extending beyond the limits of any one State.

I am, therefore, of opinion that these provisions, on their face, and construed according to the intention of the Legislature, extend to a great number of cases not within the competence of Parliament, and are so far ineffectual.

The question remains to be considered whether this excess invalidates the provisions of the Act relating to registration. In order that an association may be registered, its rules must provide for, amongst other things, ( d ) the mode in which industrial agreements may be made by it or on its behalf. Any provision in the rules for making an agreement which is not an agreement relating to a matter within the ambit of the powers of the Parliament, cannot derive any authority from the Act, nor can any such agreement derive any validity from it. What, if any, validity it may have, it must derive from other sources. But I think that the Parliament may limit the privilege of registration to associations whose internal constitution is such that they have, by agreement of the members, authority to deal with other matters of a like kind, although not within the ambit of the powers of the Parliament. In this view, the provisions of the schedule are not enabling, but restrictive, provisions. And in this view I think that they are not open to objection. Upon the whole, therefore, I think that these provisions do not vitiate the provisions for registration. Although, therefore, in my opinion, the Act contains provisions which are beyond the competence of the Parliament, I think that the provisions for registration of associations are severable from the invalid provisions, and are not themselves invalid.

I should add that the association registered in this case is one of employés in an industry, namely, coalmining, which is clearly within the Constitution, and they might become parties to an industrial dispute extending beyond Victoria.