C. A. 1903 HOWDEN V. YORKSHIRE ASSOCIATION. subsisting for any other purpose than the recovery of damages : Frost v. Knight. (1) With regard to rule 65, it is clear that this was not the case. of a lock-out, and the men cannot be said on July 17 to have been "thrown out of employment" in consequence of any action taken by the association for they had already put an end to their employment of their own accord on June 30. It is submitted that the rule must contemplate an employment the continuity of which is broken in the first instance through some action of the association. Here all that can be said is that the men failed to obtain re-employment by reason of following advice given to them by the association. If the words "thrown out of employment" are to be construed as suggested by the defendants, then they must include any members unable to obtain work at a colliery in consequence of the action of the association, whether they had ever been at work at the colliery before or not, which cannot have been the intention of the rule. R. Vaughan Williams, for the trustees of the association, stated that they had taken the view that they were bound to apply any funds in their hands in accordance with the directions of the council of the association, but with regard to the future they would of course be bound by any order the Court thought fit to make. Danckwerts, K.C., in reply. VAUGHAN WILLIAMS L.J. This action is brought by the plaintiff, a member of the Yorkshire Miners' Association, a trade union registered under the Trade Union Act, 1871, against the association and its general and branch treasurers. There were no pleadings, but the indorsement on the writ states that the plaintiff claims, as a member of the association, an injunction to restrain the defendants, their officers, agents, and servants, from misapplying the funds of the association and dealing with them in a manner contrary to the rules of the said association and the provisions contained therein. The case really raises two questions, of which the first is a pure (1) (1872) L. R. 7 Ex. 111. question of law, and the other is a question which depends partly on the true construction of certain of the defendant society's rules and partly on the inferences of fact to be drawn from certain documents and undisputed facts. This latter question is whether the application of the funds which the defendants are proposing to make is a misapplication of them, which ought to be restrained by injunction. The argument for the defendants on the first question, which, as I have said, is one of law, is put in two ways. First, it is said that the right to bring such an action as this must depend upon the provisions of the Trade Union Act, 1871, and that, when that Act is looked at, it will be seen that a member of a trade union is not only not entitled thereby to bring such an action, but is actually prohibited from doing so. That contention is based mainly on the 3rd sub-section of s. 4 of the Act. It is further contended that, if the argument based on the words of that section cannot be maintained, and such an action is not thereby prohibited, the plaintiff is not the right person to bring the action. It is said that possibly some action of the kind might be brought by the trustees of the trade union, whose position is defined by s. 9 of the Act; but that this action is not brought by them, but by the plaintiff, without any reference on the face of the writ to its being brought by him on behalf of any other members of the association besides himself. These, I think, are shortly the main questions raised by this case. In the course of the argument it was pointed out by the Court that, according to the usual practice in such cases, the trustees, as being the persons in whose hands are the funds the misapplication of which it is sought to restrain, ought to be brought before the Court in order that the action may be properly constituted. The Court therefore thought it right to direct that they should at this stage be added as defendants on certain terms, in order that any injunction which might be granted with regard to the future application of the funds should be binding upon them. Having made these observations, I will proceed to deal with the question of law arising on the construction of the Trade Union Act, 1871. The defendants deny that the proposed C. A. 1903 HOWDEN v. YORKSHIRE MINERS' ASSOCIATION. Vaughan Williams L.J. C. A. 1903 HOWDEN v. YORKSHIRE MINERS' ASSOCIATION. Vaughan application of the funds would be a misapplication of them; but they contend that, assuming the contrary to be the case, an action of this kind is prohibited by s. 4, sub-s. 3, of the Trade Union Act, 1871. It will be remembered that, prior to the passing of that Act, combinations of workmen, like the defendant association, were illegal in such a sense that their Williams L.J. members could not bring actions to enforce their rights inter se, nor could they successfully prosecute their officials for the misappropriation of their funds. Then came the Act, which by ss. 2 and 3 provides that the purposes of a trade union shall not, by reason merely that they are in restraint of trade, be deemed to be unlawful, so as to render any member of the union liable to criminal prosecution, or so as to render void or voidable any agreement or trust. If those provisions stood alone, then, subject to any practical difficulties which might arise from the fact of a trade union not being a corporate body, the result would be that there would be nothing to prevent a trade union from suing or being sued for the purpose of enforcing an agreement which was in its nature in restraint of trade that is to say, not only would such trade unions be relieved from any liability to criminal prosecution and any disability under which they had previously laboured with regard to the protection of their property, but they would be in a position to enforce an agreement in restraint of trade, which no other person in the realm can do. The Legislature appears to have thought that, the agreements made between the members of trade unions being ordinarily in restraint of trade, some limitation ought to be imposed upon their power to bring actions in respect of such agreements, after the removal of their prior disabilities as provided for by ss. 2 and 3 of the Act; and therefore s. 4 was passed for that purpose. That section, so far as material, runs as follows: "Nothing in this Act shall enable any Court to entertain any legal proceeding instituted with the object of directly enforcing or recovering damages for the breach of any of the following agreements, namely. 3. Any agreement for the application of the funds of a trade union (a) to provide benefits to members." It is not disputed that the rules of the defendant association registered in C. A. 1903 accordance with s. 14 and the 1st schedule of the Act constitute an agreement of the kind contemplated by sub-s. 3; but it is contended on behalf of the plaintiff that this action is not a proceeding instituted with the object of directly enforcing that agreement, inasmuch as the result of the action, if successful, MINERS' HOWDEN V. YORKSHIRE -ASSOCIATION. will not be that the plaintiff will recover anything, or obtain Vaugban any declaration of his right to any benefit. In support of Williams L.J. that contention the decision of Fry J. in the case of Wolfe v. Matthews (1) was cited. In that case the plaintiffs sued, on behalf of themselves and other members of a trade union, to restrain the defendants from applying any part of the funds of the society in carrying out an amalgamation with another society, contrary to the rules which directed the application of such funds to the provision of benefits to members. The preliminary objection was taken that the action was a proceeding instituted with the object of directly enforcing an agreement for the application of the funds of a trade union to provide benefits to its members. Fry J. held that to grant an injunction to restrain the misapplication of the funds of the union was not directly to enforce such an agreement. He said that an order that the defendants should pay money to the plaintiffs would be a direct enforcement of an agreement for the application of funds, but that all that was sought was to prevent the payment of the moneys to somebody else; and that, either that was no enforcement of an agreement at all, or it was an indirect enforcement. He went on to say that it was only by a stretch of language that such an order could be said to enforce an agreement, and that the utmost that could be said was that it made it more likely that the plaintiffs would obtain payment of the benefits to which they might be entitled. On those grounds he was of opinion that the judgment of Jessel M.R in Rigby v. Connol (2) did not apply. In answer to the plaintiff's contention the defendants contend that the decision of Fry J. in Wolfe v. Matthews (1) was wrong; that the decision of Jessel M.R. in Rigby v. Connol (2) governs the present case, and that that decision was affirmed by the judgment of the Court of Appeal in (1) 21 Ch. D. 194. (2) 14 Ch. D. 482. C. A. 1903 HOWDEN V. YORKSHIRE ASSOCIATION. Vaughan Chamberlain's Wharf, Limited v. Smith. (1) It is therefore necessary to consider those cases. In Rigby v. Connol (2) the plaintiff, who had been expelled from a trade union, brought an action against the committee and trustees of the union, MINERS' claiming to be entitled to participate in the benefits of the union, and asking that the defendants should be restrained Williams L.J. from excluding him therefrom. That appears to me to be a very different kind of action from that which was brought in Wolfe v. Matthews (3), because the plaintiff was claiming a share in the benefits of the union, and asking for an injunction to enable him to get that share. Jessel M.R., after saying that the statement of claim shewed no cause of action, inasmuch as it did not state that there was any property belonging to the union, or that the plaintiff was entitled to any share in such property, went on to dismiss the action on the ground that it came within the prohibition of s. 4 of the Trade Union Act, 1871. After stating that the object of the Act was primarily to prevent the officers of trade societies from robbing them, and to enable them to sue in respect of their property, and to hold property, he went on to say that it was not intended that the contracts entered into by the members of the society should be made legal contracts inter se, so that Courts of justice should interfere to enforce them; and that, the agreement contained in the rules of the union being an agreement to provide benefits for members, if he were to decide in favour of the plaintiff, he would be directly enforcing that agreement, because he would be declaring that the plaintiff was entitled to participate in the property of the union, and in substance enforcing specific performance of the agreement. I agree with Fry J. in thinking that the judgment of Jessel M.R. in Rigby v. Connol (2) did not involve the result that to decide in favour of the plaintiffs in Wolfe v. Matthews (3) was directly to enforce an agreement for the provision of benefits to the members of a trade union. Then comes the case of Chamberlain's Wharf, Limited v. Smith. (1) That also was an action by plaintiffs, who were members of (1) [1900] 2 Ch. 605. (2) 14 Ch. D. 482. (3) 21 Ch. D. 194. |