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June 2014

The TWU "training fund" that Josh Bornstein from Maurice Blackburn did a fantastic job on

Here is a link to Kathy Jackson's statement adopted in sworn evidence to the Royal Commission.

This extract is about Josh Bornstein, a principal at Maurice Blackburn lawyers.

Josh bornstein


And here's Ray Martin, Ross Coulthard and Nine's Sunday program talking about the very same training fund that Josh did such a fantastic job on.   Fantastic that is for Tony Sheldon.   Members - not so much.



Starting next Wednesday the Royal Commission into Trade Union Governance and Corruption will let you know all about it too - and we'll find out what Michael Williamson meant when he praised up Josh and the fantastic job he did.

Val GOSTENCNIK met with lawyers for Williamson's HSU to help Bill Shorten get an administrator into the union

Bill Shorten's lawyer Val GOSTENCNIK attended a conference with lawyers acting for Michael Williamson friendly elements of the HSU days before Bill Shorten applied to put the HSU into administration.

Holding Redlich solicitors billed the HSU $2,060 for a series of telephone "attendances" on Val GOSTENCNIK and others 3 days before Shorten's application for an Administrator.   GOSTENCNIK made the application to the Federal Court on Shorten's behalf.

Kathy Jackson was then the National Secretary of the HSU.   She reported Michael Williamson and Craig Thomson to police for embezzlement of HSU funds in August/September 2011.   Jackson alleged at the time that Shorten's application for an Administrator was co-ordinated with Williamson-friendly elements within the HSU.   Ms Jackson told the AFR, "“[Mr Shorten] wants to make sure he ends up in a position where he controls this union personally, not as the minister, but personally.”

On Friday 21 March 2014 the Legal Services Board of Victoria was sent this complaint about GOSTENCNIK.   The complaint alleged a serious conflict of interest on GOSTENCNIK's part in acting for Fair Work Australia in its investigation of Craig THOMSON while at the same time acting for Bill Shorten in Shorten's application to put the HSU into administration.   GOSTENCNIK was in possession of FWA's then confidential investigation report into Thomson and the HSU, information that was not available to other parties in the Shorten application to the Federal Court for an Administrator to be appointed to run the HSU.

The following publications refer to GOSTENCNIK and SHORTEN:

  • Report to the Legal Services Board alleging serious misconduct against GOSTENCNIK.
  • Chronology regarding SHORTEN's application to the Federal Court.
  • GOSTENCINIK's role in recommending an "independent" body to review FWA's Thomson investigation of Thomson.
  • StephenJ's commentary about potential breaches of the Commonwealth Crimes Act by GOSTENCNIK

The following correspondence is from Holding Redlich, lawyers acting for Michael Williamson-friendly elements of the Health Services Union in 2012.

Here is Holding Redlich's letter to Chris Brown, one of Michael Williamson's supporters.

Holding letter to brown


Here is the Holding Redlich Trust Statement for the HSU for May to August 2012 - $270,000 in legal fees paid for by the HSU in the Federal Court proceedings that resulted in Shorten's administrator being appointed.

Holding redlich trust statement

And here is a bill received by Chris Brown in August 2012 in relation to work Holding Redlich performed in April 2012 in the same matter.

Holding redlich to brown bill_001

Holding redlich to brown bill_002

Note the following billing entry for 27 April, 2012.


Brown gostencnik

On 3 April 2012 Bernadette O'Neill, Fair Work Australia GM sent GOSTENCNIK a complete copy of FWA's report into Thomson and all its attachments/statements etc.

On 12 April 2012 GOSTENCNIK accepted Bill Shorten's brief to act for Shorten in his application to have an administrator appointed to the HSU.

27 April, 2012 GOSTENCNIK attended the above conference with lawyers for Chris Brown and the HSU.

30 April, 2012 GOSTENCNIK applied on Bill Shorten's behalf for an Administrator to be appointed to the HSU.


Here's the AFR's reporto published on 27 April 2012 the day after Shorten announced he would ask the Court to appoint an Administrator:

Judge queries Shorten move against HSU

PUBLISHED: 26 APR 2012 11:12:00 | UPDATED: 27 APR 2012 11:38:02



A Federal Court judge has expressed scepticism about the Gillard government’s sudden decision to install an administrator to take control of the Health Services Union and questioned why the government turned up to court asking for two weeks to get the paperwork together.

Workplace Relations Minister Bill Shorten took the rare step of moving to place the HSU East branch into administration, a decision welcomed by the ACTU and Unions NSW and blasted by Kathy Jackson, the national secretary at the centre of a power struggle in the union.

“He [Mr Shorten] wants to make sure he ends up in a position where he controls this union personally, not as the minister, but personally,” she said.

Mr Shorten, who said he was acting to protect the union’s 55,000 members, signalled he might block publication of a report by Fair Work Australia into alleged irregularities in the union that examined the role of former national secretary and federal Labor MP Craig Thomson.

“I will not put at risk any potential civil or criminal charges,” he said.

He was accused by the federal opposition of trying to shield Mr Thomson.

Appointing an administrator will delay the release of an investigation by barrister Ian Temby and accountant Dennis Robertson into alleged rorting in the HSU East branch, which covers workers in Victoria and NSW.

A version of the report was due to go to the branch’s executive on Monday. The meeting was cancelled because of legal action.

A government-hired lawyer asked the Federal Court in Sydney on Thursday for a fortnight to file the application to appoint an administrator.

Judge Geoffrey Flick said the request was a “bit odd” and gave the government until the end of Monday. Justice Flick said it would not be enough to issue a “press release” in his courtroom about a “hypothetical application”.

“I have a degree of scepticism as to the timing of this application,” he said. “The minister should have made it much earlier than today.”

In Melbourne, Mr Shorten said the government had to decide on a “most serious and grave action” to protect the union’s members from further “dysfunctional fighting”.

Mr Shorten said the government’s intervention would not support any individual or faction within the union. His claim was attacked by outspoken HSU leader Ms Jackson who has pursued Mr Thomson and HSU president Michael Williamson.

Ms Jackson agreed there were grounds to appoint an administrator but accused Mr Shorten of being personally involved in backroom manoeuvring against her, and protecting Mr Thomson.

Ms Jackson alleged that a HSU member and suburban Labor Party identity in Melbourne, Diana Asmar, contacted union members in recent weeks to seek individuals who would be prepared to lodge internal charges against her. Cr Asmar is a former Labor mayor of the City of Darebin and unsuccessfully stood for a position in the union’s Victorian branch against a key supporter of Ms Jackson.

Mr Shorten said he had “absolutely not’’ been involved in backroom machinations against Ms Jackson and had not seen Cr Asmar for about a year. A spokesman for Communications Minister Stephen Conroy said he had not “met with or spoken to Diana Asmar this year”.

The federal opposition’s workplace relations spokesman, Eric Abetz, said Mr Shorten’s actions were “too little, too late” and voters and union members were entitled to know the full details.

“The release of the Wood Royal Commission, the release of the Fitzgerald inquiry in Queensland, did not prejudice the bringing of criminal charges,” he said.

“It also shows the thinking of [Prime Minister Julia] Gillard and her government that the longer this matter can drag on, the better, because it gets them closer and closer to the election date without having to deal with Mr Thomson.”

Opposition Leader Tony Abbott dismissed Mr Shorten’s actions as a “squalid manoeuvre” to hide a contentious report.

“What is the government trying to hide here?” Mr Abbott said on the Nine Network on Friday.

“What does the government know? Is the government trying yet another squalid manoeuvre to keep the FWA report hidden, to try to protect Craig Thomson for even longer?”

A Senate committee sought advice from the Commonwealth Director of Public Prosecutions over a request from Mr Thomson’s lawyers to suppress a Fair Work Australia report that outlines 181 workplace law breaches at the Health Services Union while he was national secretary.

Read more at the AFR website.

I look forward to Shorten's appearance at the Royal Commission - and GOSTENCNIK's answers to the Legal Services Commissioner.


Lance Boyle, former General Secretary of the NSW Branch of the ACU*T. Mentor to a new generation of union leaders.

It's well worth the effort to find a copy of this collection of Barry Humphries scripts and sketches:

Barry humphries one

It was published by Currency Press in 1981.

Barry created the character Lance Boyle, General Secretary of the NSW Branch of the ACU*T in 1978.   Barry Humphries is a genius.   Here's Lance:

Lance cropped

It's hard to imagine Craig Thomson, Michael Williamson, Bruce Wilson and many others charting their course without the Lance Boyle guidebook to union leader ettiquette. 

Here's a little sample:

Lance does his block

Lance does his block two

Lance does his block three

I hope that Barry Humphries can find it in his heart to get in touch with Lance from his chalet in the Swiss Alps - the Royal Commission should put him on as a consultant.

StephenJ with a smoking gun

You should read the affidavit of Detective Sergeant Ross Mitchell below - then read these comments from StephenJ.


From the desk of StephenJ

1.The Police have had all Gillards personnel records and S&G records dealing with her since June 2013.

Sciacca’s had become involved somehow in relation to a subpoena issued to the Commonwealth Bank in Perth. Police have S&G’s response to this. See the mention of Sciacca’s in relation to the documents on which S&G  were successful  in their LPP claim. Sciacca’s have acted on behalf of Ludwig.

2.The Documents for which S&G claimed privilege appear to relate to the Trust Account transactions on Kerr St.

S&G appear to have been concerned (probably sh*tting bricks actually) about the incorrect recording that had taken place. The documents include the instructions from the Commonwealth Bank on the depositing of the $67k recorded in the Slater and Gordon Trust Account Ledger as having come directly from Ralph Blewitt, when the actual drawer of the cheque was the AWU Workplace Reform Association Inc.

Their concern appears to have arising because some interference had occurred in the normal processes involved. The possible candidates for such interference are extremely limited.

None of the originals of these documents would have been subject to a claim for LPP. The copies were made specifically for the purpose of obtaining advice from Phillips Fox and therefore are subject to LPP on the basis of the decision in Propend.

However certain comments were made in that case about the situation that would apply if originals were destroyed. LPP may not apply to the copies on Public Policy/ abuse of court grounds. I can find the comments if you desire.

I don’t know whether these issues were dealt with in the argument before Digby.

Perhaps you could make some enquiries, however as I have been trying to make clear while the decision may restrict the Police it will not stop the RC under the powers it possess as a Victorian RC.

3. I wanted to add something to what I sent you a few days ago.

a) I can see no reason why the Police would not have interviewed Martin Albrecht, the managing director of Thiess at the relevant time.

The story of a separate entity to provide for training just wont wash.

Albrecht is in the gun and he would know it.

It is conceivable that Albrecht may have had recent discussions with Ludwig about this and likewise Ludwig with Wilson.

It may be that this is the reason for Wilson’s admission about the meeting at which the arrangement was discussed. Albrecht may have informed the Police about it.  

b) If a Client came to an Accountant or Solicitor and said “I want to incorporate an Association” the first response would be to get them to state what they were trying to achieve. Whether the Professional was attempting to further illicit aims or not they would give some thought to how to best achieve the Clients objectives.

An Association is an unusual structure although one which is likely to avoid normal scrutiny by regulatory authorities eg the Tax Office.

Ludwig and Wilson controlled the Union. I can see no reason why Murphy wouldn’t have asked the right questions and I can see no reason why he wouldn’t have been told that the Association was required by and because of an arrangement with Theiss.

Assuming he was also told that the funds were to be used for Union related training there is no problem. Extracting funds from Employers to use for Union purposes does not raise the issue of secret commissions or fraud on some party. However the use of such funds for private purposes will bring such considerations into play and Gillard has stated numerous times that her understanding of the Associations purpose was as a slush fund for elections.

It is clear that such use is for private purposes.

If Murphy knew where the funds were coming from it is inconceivable Gillard did not.

If she knew the source of the funds her stated understanding of the proposed uses directly involves her in the offences committed.

This position is only reinforced by subsequent events where it appears she received personal benefits herself and may have been involved with Trust Account irregularities.

c) Murphy is the key and I can think of a lot of reasons why he would want to be very careful in what he says to the RC.

I say on the evidence that the RC has “Wilsons File”. It appears they are saving it for use against later witnesses.

Wilson is going down anyway.

I think we are getting very close to saying Gillard is too.

The affidavit of Detective Sergeant Ross Glenn MITCHELL of the Fraud and Extortion Squad, Crime Department, Victoria Police

It's worth reading Ross's affidavit in the matter of the legal professional privilege claim lodged by Bruce Morton WILSON.   WILSON's claim has been rejected by Chief Magistrate Peter Lauritsen and WILSON has appealed against the Magistrate's ruling to the Supreme Court.   The Supreme Court has heard the arguments and read evidence submitted by each of the parties and has reserved its decision sine die - it could be delivered any day now.

Shortly StephenJ with some analysis of Ross's affidavit.

Ross glenn mitchell_001 Ross glenn mitchell_002 Ross glenn mitchell_003 Ross glenn mitchell_004 Ross glenn mitchell_005 Ross glenn mitchell_006 Ross glenn mitchell_007 Ross glenn mitchell_008 Ross glenn mitchell_009  Ross glenn mitchell_011Ross glenn mitchell_010 Ross glenn mitchell_012  Ross glenn mitchell_015Ross glenn mitchell_014Ross glenn mitchell_013   Ross glenn mitchell_017Ross glenn mitchell_016  Ross glenn mitchell_019Ross glenn mitchell_018    Ross glenn mitchell_023Ross glenn mitchell_020Ross glenn mitchell_021Ross glenn mitchell_022 Ross glenn mitchell_024  Ross glenn mitchell_026Ross glenn mitchell_025 Ross glenn mitchell_027 Ross glenn mitchell_028 Ross glenn mitchell_029 Ross glenn mitchell_030 Ross glenn mitchell_031
Ross glenn mitchell_032 Ross glenn mitchell_033 Ross glenn mitchell_034 Ross glenn mitchell_035 Ross glenn mitchell_036

More on the LPP claim by Wilson and the Royal Commission - by StephenJ

Hi Michael

The Royal Commission (has powers in relation to) the documents from the S&G search warrant.  One reading of the exchange below in combination with what's known of the Royal Commission's powers would deliver an inference that the RC already has the documents.

It appears the Royal Commission is allowing Victoria's Supreme Court to give its decision.

Under the Commonwealth RC Act the documents have to be provided to the RC unless a Court has previously decided that they are subject to privilege.

When they are provided Wilson must claim privilege with the R/C.

As I have previously set out it wont stop the R/C anyway because of the powers it possesses under its Victorian Commission.


Here is some of the proceedings at the Royal Commission on Wednesday, 11 June 2014.

DR HANSCOMBE: Commissioner, Astrid Haben-Beer is present

7 with me today. She will tomorrow, if need be, be making a

8 privilege argument before the Commission for Mr Wilson.


10 THE COMMISSIONER: She will present a privilege argument

11 tomorrow?


13 DR HANSCOMBE: If need be, yes.


15 THE COMMISSIONER: Have you discussed anything about that

16 with Mr Stoljar?


18 DR HANSCOMBE: I just asked Mr Stoljar had there been any

19 progress about that issue and he told me that he was not

20 aware of any progress. I can tell you that the appeal in

21 the court in Victoria was adjourned yesterday, to be heard

22 in Victoria on Friday.


24 THE COMMISSIONER: That appeal concerns what I will call

25 these 1995 documents for which privilege is claimed?


27 DR HANSCOMBE: Yes, Commissioner, so there's a direct

28 overlap between the privilege claim made in the appeal and

29 the privilege claim made here.


31 THE COMMISSIONER: The appeal is against the decision of a

32 magistrate that the documents were not privileged?




36 THE COMMISSIONER: I didn't quite catch the name of your

37 colleague who will present the argument.


39 DR HANSCOMBE: My junior's name is Astrid Haben-Beer and

40 I think the Commission has received a short submission made

41 by Ms Haben-Beer in writing.


43 THE COMMISSIONER: I've certainly seen a submission. I'm

44 not sure it's by her, but at all events, I've seen that.

45 Very well. It's contemplated that argument will be dealt

46 with at 10 o'clock tomorrow, assuming other matters.


.11/06/2014 (4) 287

Transcript produced by Merrill Corporation


Some insight into the Legal Professional Privilege claim by Wilson

Here's a bit of background - more soon as we await the publication of the Supreme Court of Victoria's finding in the Wilson appeal against Chief Magistrate Lauritsen's orders that the Slater and Gordon documents be released to police.   This piece was first published in October 2013


The mother of all expense reimbursements - $160,000 handed back after legal advice

Today we should get some insight into what's in the box of documents seized by police from Slater and Gordon under their search warrant on 17 May this year. 

Here's the SMH's Mark Baker on 17 October, 2012.

Gillard files missing, say lawyers

A FILE detailing Julia Gillard’s role in helping set up a union slush fund from which her former boyfriend stole hundreds of thousands of dollars has disappeared.

Law firm Slater & Gordon yesterday said it could find no documents relating to the work done by Ms Gillard — a former salaried partner of the firm — in establishing the Australian Workers Union Workplace Reform Association in 1992.

Police believe the association was used by Ms Gillard’s former boyfriend and senior AWU official Bruce Wilson to steal more than $400,000, including about $100,000 which helped fund the purchase of a Fitzroy unit bought with Ms Gillard’s professional assistance.

Slater & Gordon managing director Andrew Grech told The Age last night that the firm had not been able to locate any documents relating to the controversial transaction. ‘‘We have not been able to identify any such documents following extensive searches of our archival records,’’ Mr Grech said. 

‘‘If there are such documents, we don’t have them. They could have been misplaced, or lost. I simply don’t know.’’ 

We know that the file was present at Ms Gillard's departure interview on 11 September, 1995.

PG: My recollection is that all of that happened in or about mid-1992. Is that right?

JG: I wouldn't want to be held to the dates without looking at the file, but whatever the dates the file shows are the right dates, so . . .

PG: Yes. And to the extent that work was done on that file in relation to that it was done by you?

But it's now disappeared.   So today's proceedings can't be about setting up the workplace reform association.

On what other issues then did a laywer(s) at Slater and Gordon give legal advice to Bruce Wilson?    We are told Mr Wilson intends to claim client legal privilege over the documents in the box at the court today.   We also know that police will argue that the documents were created in the furtherance of fraud.   So the issue has to be one on which he received advice and one in which it appears some fraud or improper conduct was involved.

To me the most likely topic will be the issues associated with Bruce Wilson's departure from the union.

In the first few months of 1995 about $160,000 was banked into the AWU Members Welfare Association No 1 Account, the deposits are detailed here.   Large cheques came from Thiess, John Holland, Philips Fox and other companies.

On 14 July, 1995, Wilson tried to bank a cheque for $160,770 from the Members Welfare Association No1 a/c into an account he controlled with Ralph Blewitt.  That action may have amounted to an attempted theft of the money.

On that same day, 14 July 95 Maurice Blackburn wrote to the Commonwealth Bank on behalf of the new AWU Victorian state mananagement instructing the bank to freeze all AWU accounts.

So from 14 July there was no access to official AWU funds in Victoria until the settlement of the matters with Wilson's departure on 17/18 August, 1995.

On 2 August, 1995 the National Finance Committee of the AWU met in Sydney.  Wilson admitted that the AWU Members Welfare Association No 1 account contained private and union funds.

Bill Ludwig swore an affidavit (on 18 August, 1995) in which he said that on 2 August Bruce Wilson told the National Finance Committee that the AWU Members Welfare Association contained private funds, notwithstanding that large cheques made out to the AWU were banked into it.   This post shows some of the transactions on the account, including the payment of $10,000 to Kon Spyridis the builder along with a withdrawal of $5,000 in cash.

On 4 August, Bob Smith (Victoria Branch Secretary) wrote to Ian Cambridge and Steve Harrison, the joint national secretaries of the AWU, advising of his intention to charge Bruce Wilson internally and to refer him to police.

On 9 August, 1995 Ian Cambridge wrote to the Commonwealth Bank recording that Slater and Gordon and Maurice Blackburn represented parties to a dispute.


Bob Smith advised Ian Cambridge of his intention to charge Wilson and refer him to police on 4 August, 1995.   On 9 August, Ian Cambridge writes to the CBA and refers to a telephone conversation between himself and the bank manager Peter McArthy - in which the fact of Wilson being represented by Slater and Gordon was noted.

On 27 November, 2012, Slater and Gordon released this statement,, which included the following:

For the avoidance of doubt in relation to the AWU matter:

a) Slater & Gordon acted for both a union and a union official (personally).

b) in acting for the official, Slater & Gordon obtained information:

i). that was confidential to the official; and

ii) the disclosure of which to the union would have represented a conflict between the interests of the union and the interests of the official.

c) Slater & Gordon ceased acting for both clients after it became aware of this conflict situation.

Peter Gordon was a little more descriptive when he and Nick Styant Browne were jointly involved in putting this statement together, published by The Australian newspaper on 21 August, 2012.   Peter Gordon says Slater and Gordon found out about the Wilson allegations in July, 1995.

I have been told that the relevant Slater & Gordon files reveal that certain relevant 'new' information was made to Bernard Murphy in July 1995, and very shortly thereafter to Ms Gillard. No evidence in any of the firm's records exists that information as to any matter which can incontrovertibly be described as wrongdoing was available to or known by either of them before this time. Shortly after this time, this 'new' information was passed on to the other partners. There was a small delay in the transmission of this information by Mr Murphy to the rest of us which I interpreted as mediated only by the serious deterioration in our relationship and the mental strain under which he obviously labored at the time. When the information was conveyed to the other partners, the firmimmediately ceased acting for the AWU, for Mr Wilson and Mr Blewitt. The leadership of the AWU had passed at this time from Mr Wilson to a new administration which retained Maurice Blackburn. Both Maurice Blackburn and the new administration were aware of the relevant allegations and was to our satisfaction, in a position to protect the union's interests insofar as those interests may have been affected.

So we know that Peter Gordon's memory had been refreshed prior to his August 2012 statement by the details contained in "the relevant Slater and Gordon files".    That lends support to the belief that those files were available to police when they executed their warrant this year.

I think Peter Gordon's interpretation of the "small delay" in the transmission of information by Bernard Murphy to the other partners is a charitable one.   Perhaps today we will see what else happened during the "small delay" and whether either Bernard Murphy, or Ms Gillard continued to give Bruce Wilson legal advice.

On 17 August, 1995, Bruce Wilson, Jim Collins and Bob Smith attended at the Commonwealth Bank and each signed a hand-written letter describing the only accounts in which the AWU had an interest as being the AWU Victorian Branch Account and the AWU Grant Account.

As a result, the Commonwealth Bank released the money in the AWU Members Welfare Association No 1 Account directly to Bruce Wilson (the signatory) and Bob Smith.


Wilson at that point assumed the rights of an owner, or appropriated that money.   It will be interesting to hear what factual basis Wilson, Bob Smith and Jim Collins have for telling the bank that the AWU had no interest in the money in the AWU Members Welfare Association No 1 account.

After appropriating the money, Wilson further dealt with it as it was returned to the various companies from whom it had been extracted.   But it's important to note, it was not the AWU that returned the money, the CBA did not release the money to the AWU.  It was Wilson and Bob Smith's money to deal with, and they had arguably deceived the CBA in the hand-written letter which claimed that the AWU had no interest in the money in that account.

So Wilson supervised the release of the money - more than $160,000 - and its repayment to the companies from whom he had extracted it.   Today we might find out on whose legal advice he did that.

As I said in this post on 10 July, 2013 - "maybe the Minchin Protocol started right here" as it's unusual in the extreme for anyone to return money that's been properly received in the first place. 

Phil Gude spoke about the matter in October 1995 in this newspaper article.

Mr Gude said that when Wilson had found he had been discovered, he sought legal advice from the union's solicitors, Slater and Gordon, andwas given advice by Ms Gillard.

In July this year I wrote this post

Slater and Gordon's lawyers continued to act not for, but against the AWU after July, 1995

The Murphy/Gillard actions after July, 1995 were similar to their actions in August, 1993 when allegations of financial mismanagement were made within the AWU against Ralph Blewitt.   Instead of acting to examine the matters raised and to safeguard the AWU's interests, Gillard and Murphy went in to bat for Wilson and Blewitt, issuing agressive defamation proceedings against those people who were calling for proper audit and enquiry into the branch finances.

It's hard to see how the interests of Slater and Gordon's client the AWU were served in either case.   After Wilson returned the money to the companies, the AWU was put to considerable time and effort to get that money back and in so doing it asserted its rights as the owner of the money.   It will be interesting to see how police treat the hand-written letter of 17 August in which Wilson, Smith and Collins tell the CBA that the AWU has no interest in the Member Welfare Association No 1 money.

That assertion by the police about the furtherance of fraud in relation to these documents is starting to make a bit more sense.