A senior member of the Western Australian Industrial relations Commission has recently issued a decision in an unfair dismissal case which summarizes the law about what constitutes a constitutional corporation for the purposes of determining whether such a case falls to be determined by the Fair Work Commission or the State Commission.
In Phillip Digney -v- The Black Cockatoo Preservation Society of Australia (2014) WAIRC 01285 Kenner C wrote
“The relevant test as to whether a corporation is a trading or financial corporation was dealt with by the Industrial Appeal Court in Aboriginal Legal Service of Western Australia (Inc) v Lawrence [No 2] (2008) 89 WAIG 243. In this case, Steytler P, with whom Pullin J agreed, set out the relevant principles dealt with by six decisions of the High Court, as to the test in determining whether a corporation should be regarded as a trading corporation. At par 68 Steytler P summarised the relevant principles falling from those cases in the following terms:
(1) A corporation may be a trading corporation even though trading is not its predominant activity: Adamson (239); State Superannuation Board (303 – 304); Tasmanian Dam case (156, 240, 293); Quickenden  – , ; Hardeman .
(2) However, trading must be a substantial and not merely a peripheral activity: Adamson (208, 234, 239); State Superannuation Board (303 – 304); Hughes v Western Australian Cricket Association Inc (1986) 19 FCR 10, 20; Fencott (622); Tasmanian Dam case (156, 240, 293); Mid Density (584); Hardeman .
(3) In this context, ‘trading’ is not given a narrow construction. It extends beyond buying and selling to business activities carried on with a view to earning revenue and includes trade in services: Ku-ring-gai (139, 159 – 160); Adamson (235); Actors and Announcers Equity Association of Australia v Fontana Films Pty Ltd (1982) 150 CLR 169, 184 – 185, 203; Bevanere Pty Ltd v Lubidineuse (1985) 7 FCR 325, 330; Quickenden .
(4) The making of a profit is not an essential prerequisite to trade, but it is a usual concomitant: St George County Council (539, 563, 569); Ku-ring-gai (140, 167); Adamson (219); E (343, 345); Pellow .
(5) The ends which a corporation seeks to serve by trading are irrelevant to its description: St George County Council (543, 569); Ku-ring-gai (160); State Superannuation Board (304 – 306); E (343). Consequently, the fact that the trading activities are conducted is the public interest or for a public purpose will not necessarily exclude the categorisation of those activities as ‘trade’: St George County Council (543) (Barwick CJ); Tasmanian Dam case (156) (Mason J).
(6) Whether the trading activities of an incorporated body are sufficient to justify its categorisation as a ‘trading corporation’ is a question of fact and degree: Adamson (234) (Mason J); State Superannuation Board (304); Fencott (589); Quickenden , ; Mid Density (584).
(7) The current activities of the corporation, while an important criterion for determining its characterisation, are not the only criterion. Regard must also be had to the intended purpose of the corporation, although a corporation that carries on trading activities can be found to be a trading corporation even if it was not originally established to trade: State Superannuation Board (294 – 295, 304 – 305); Fencott (588 – 589, 602, 611, 622 – 624); Hughes (20); Quickenden ; E (344); Hardeman .
(8) The commercial nature of an activity is an element in deciding whether the activity is in trade or trading: Adamson (209, 211); Ku-ring-gai (139, 142, 160, 167); Bevanere (330); Hughes (19 – 20); E (343); Fowler; Hardeman .
It is therefore a question of fact and degree as to whether the trading activities of a corporation are sufficient for the corporation to be characterised as a trading corporation.”