Ananda Marga Pracaraka Samgha Ltd v Tomar (No 2)

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FEDERAL COURT OF AUSTRALIA

Ananda Marga Pracaraka Samgha Ltd v Tomar (No 2) [2010] FCA 1342

Citation: Ananda Marga Pracaraka Samgha Ltd v Tomar (No 2) [2010] FCA 1342
Parties: ANANDA MARGA PRACARAKA SAMGHA LTD (ACN 003 193 897), DEVENDHRAN VADIVELOO PILLAY and PRABANJAMURTHI PILLAI v SUNIL KUMAR SINGH TOMAR, CLAUDIA ALISTER, RICHARD PFEIFFER, DAYASHANKAR TIWARI, PAUL ALISTER, DIETER DAMBIEC, JAKE KARLYLE, LUKE DEACON, MIRAI DEACON, MICHAEL TOWSEY and DHARANENDRAN PARTHY
File number: VID 208 of 2010
Judge: DODDS-STREETON J
Date of judgment: 3 December 2010
Catchwords:

CORPORATIONS – company limited by guarantee – objects include promotion of a religion – dispute over validity of resolutions to remove the plaintiff directors, the identity of members and requirements for membership – existing injunction restraining defendants – plaintiffs allege defendant director, assisted by others, diverted company’s mail, redirected traffic from company websites, copied company seal, withheld corporate contact list, competed with company’s activities and otherwise breached directors’ duties and statutory provisions to company’s detriment – whether to grant further injunctive relief – interim regime for management of company – whether external administrator required

CORPORATIONS – whether company properly a plaintiff or defendant – whether company precluded from active participation or funding the litigation
Legislation: Corporations Act 2001 (Cth), ss 181 and 183
Crimes Act 1914 (Cth), ss 85N and 85U
Trade Marks Act 1995 (Cth), s 122
Trade Practices Act 1974 (Cth), s 52
Cases cited:

Ananda Marga Pracaraka Samgha Ltd  v Tomar [2010] FCA 565
Bradto Pty Ltd v State Of Victoria (2006) 15 VR 65
Coombs v Dynasty Pty Ltd (1994) 14 ACSR 60
Metyor Inc v Queensland Electronic Switching Pty Ltd (2002) 42 ACSR 398
Power v Ekstein (2010) 77 ACSR 302
Re A Company (No 001126 of 1992) [1994] 2 BCLC 146
Re DG Brims and Sons Pty Ltd (1995) 16 ACSR 559
Sandalciyan v International Development & Construction Pty Ltd (2010) 80 ACSR 31
Sellar v Lasotav Pty Ltd [2008] FCA 1766

R P Austin and I M Ramsay, Ford’s Principles of Corporations Law

Date of hearing: 24 November 2010
Date of last submissions: 24 November 2010
Place: Melbourne
Division: GENERAL DIVISION
Category: Catchwords
Number of paragraphs: 137
Counsel for the Plaintiffs: Mr C Gunst QC with Mr M Irving
Solicitor for the Plaintiffs: Holding Redlich
Counsel for the Defendants: Mr C.A Sweeney QC
Solicitor for the Defendants: Cooper Grace Ward

IN THE FEDERAL COURT OF AUSTRALIA

VICTORIA DISTRICT REGISTRY

GENERAL DIVISION

VID 208 of 2010
BETWEEN:

ANANDA MARGA PRACARAKA SAMGHA LTD (ACN 003 193 897)
First Plaintiff

DEVENDHRAN VADIVELOO PILLAY
Second Plaintiff

PRABANJAMURTHI PILLAI
Third Plaintiff
AND:

SUNIL KUMAR SINGH TOMAR
First Defendant

CLAUDIA ALISTER
Second Defendant

RICHARD PFEIFFER
Third Defendant

DAYASHANKAR TIWARI
Fourth Defendant

PAUL ALISTER
Fifth Defendant

DIETER DAMBIEC
Sixth Defendant

JAKE KARLYLE
Seventh Defendant

LUKE DEACON
Eighth Defendant

MIRAI DEACON
Ninth Defendant

MICHAEL TOWSEY
Tenth Defendant

DHARANENDRAN PARTHY
Eleventh Defendant

JUDGE:

DODDS-STREETON J

DATE OF ORDER:

3 DECEMBER 2010

WHERE MADE:

MELBOURNE

THE COURT ORDERS THAT:

1.Until final determination of the proceeding…

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Details
Case
[2010] FCA 1342
Decision Date

CaseChat Overview and Summary

The matter involved Ananda Marga Pracaraka Samgha Ltd, a company limited by guarantee operating to propagate the ideals, philosophy and practice of the Ananda Marga religion, and several defendants who were former directors of the company. The dispute centred on the validity of resolutions to remove the plaintiff directors, the identity of the company's members, and the requirements for membership. The plaintiffs alleged that the defendants, assisted by others, had taken actions detrimental to the company, including diverting its mail, redirecting traffic from its websites, copying its seal, withholding its corporate contact list, competing with its activities, and breaching directors’ duties and statutory provisions. The court was required to decide whether to grant further injunctive relief and whether an external administrator was necessary for the interim management of the company.

The court found that the plaintiffs had established a serious issue to be tried concerning the validity of the resolutions to remove the plaintiff directors and the identity of the company's members. The court was satisfied that the plaintiffs would suffer irreparable harm if the defendants were not restrained from interfering with the conduct of the company's business and making or varying contracts or arrangements on its behalf. Consequently, the court granted the relief sought by the plaintiffs and dismissed the defendants’ notice of motion. The court also ordered that the second and third plaintiffs be recorded as directors and mandated further mediation between the parties. Additionally, the court directed the defendants to take several specific actions, including refraining from using the company seal and mail, not using the Ananda Mela Contact List, and not interfering with the conduct of the company's business by the second and third plaintiffs.

The court's decision underscored the importance of protecting the company's assets and interests while the litigation proceeded and ensured that the defendants could not further undermine the company's operations. The orders provided a framework for the interim management of the company, aimed at preserving its integrity and preventing further harm.

Orders

Orders of the court

1. Until final determination of the proceeding or further order, the defendants and each of them:

(a) Shall not affix the company seal to any contract, instrument or document.

(b) Shall deliver to the solicitors for the plaintiffs any copy or original of the company seal of the first plaintiff that is in his or her custody or control by 6 December 2010.

(c) Shall not make, or procure the making of, a copy or original of the company seal of the first plaintiff.

2. On or by 4 pm on 6 December 2010, the defendants and each of them shall deliver to the solicitors for the plaintiffs an affidavit listing all the contracts, instruments or other documents signed by that defendant after 20 March 2010 to which the company seal has been affixed, together with a copy of such contracts, instruments and documents if such are in the possession or control of the defendant.

3. Until final determination of the proceeding or further order, the defendants and each of them:

(a) Shall not collect the mail from the Post Office Box 231 at Katoomba.

(b) Shall, by 4 pm on 6 December 2010, deliver to the solicitors for the plaintiffs any copy or original of any key to the Post Office Box 231 at Katoomba that is in that defendants’ custody or control.

(c) Shall not make, or procure the making of, a copy of the key to the Post Office Box 231 at Katoomba.

(d) Shall not seek the redirection of mail addressed to the company.

(e) Shall, if so requested by the solicitors for the plaintiffs, deliver within 7 days to the solicitors for the plaintiffs an affidavit listing the names of all persons to whom any of the defendants has given a copy or original of the key to the Post Office Box 231 at Katoomba.

4. Subject to order 8 of the order, until final determination of the proceeding or further order, the defendants and each of them:

(a) Shall not use the Ananda Mela Contact List, being the list identified in paragraph 21 of the affidavit of the second plaintiff sworn 15 November 2010 ("the Ananda Mela Contact List").

(b) Shall not make, or procure the making of, a copy of the Ananda Mela Contact List.

5. Until the final determination of the proceeding or further order, the first and second defendants and each of them:

(a) Shall not enter into, or procure the making of, contracts with persons on the Ananda Mela Contact List concerning the attendance at or participation in a festival not conducted by the first plaintiff in late December 2010 or early January 2011.

(b) Shall not perform contracts with persons on the Ananda Mela Contact List concerning the conduct of a festival not conducted by the First Plaintiff in late December 2010 or early January 2011.

6. On or by 4 pm on 6 December 2010, the defendants and each of them shall deliver to the solicitors for the plaintiffs:

(a) Any copy or original of the Ananda Mela Contact List that is in his or her custody or control.

(b) any copy or original of any list of persons created using the Ananda Mela Contact List.

(c) an affidavit listing of all the letters, emails and other documents sent or received by the defendant after 20 March 2010 to or from persons on the Ananda Mela Contact List and a copy of such letters, emails and other documents if such are in the possession or control of the defendant.

7. Until final determination of the proceeding or further order, the defendants and each of them shall not use the Ananda Marga trademark or any trademark substantially identical or deceptively similar thereto, without the consent of the first plaintiff

8. On or by 4 pm on 6 December 2010, the Second Defendant write a letter or send an email to each person on the Ananda Mela Contact List to the following effect:

"On about 25 September 2009 I wrote to you promoting a New Year's Gathering 2011 to be held at the Maranatha Camp near Nambour in Queensland. The email suggested that the gathering was associated with Ananda Marga Pracaraka Samgha Ltd. The New Year's Gathering 2011 is not organised or promoted by Ananda Marga Pracaraka Samgha Ltd. There is an Ananda Mela organised by Ananda Marga Pracaraka Samgha Ltd that will be held at the property of Ananda Marga Pracaraka Sangha Ltd at Stanthorpe in Queensland between the dates 5th January 2011 and 11th January 2011. Details of that Ananda Mela can be found at www.anandamelafestival.org.au."

9. On or by 4 pm on 6 December 2010, the second and sixth defendants deliver to the solicitors for the plaintiffs affidavits setting out the following details:

(a) the correspondence sent by the second or sixth defendant using the trademark of the first plaintiff, inviting people to attend the New Year's Gathering 2011 or otherwise promoting the New Year's Gathering 2011;

(b) a statement of the funds received as a result of such invitations or promotions and a statement of by whom those funds are held;

(c) the names and addresses of each person who has accepted an invitation to attend the New Year's Gathering 2011.

10. Until the final determination of the proceeding or further order, the defendants and each of them:

(a) shall not seek or procure the redirection of traffic from the websites at the addresses www.anandamela.com.au, www.anandamela.org.au and www.anandamelafestival.org.au;

(b) Shall, if so requested by the solicitors for the plaintiffs, deliver within 7 days to the solicitors for the plaintiffs a signed letter stating that the defendant consents to the second plaintiff being nominated as the authorised administrator of the company's websites at the addresses www.anandamela.com.au, www.anandamela.org.au and www.anandamelafestival.org.au and the locking of those websites.

11. Until the final determination of the proceeding or further order, the register be amended to record that the second and third plaintiffs are directors.

12. Until the final determination of the proceeding or further order, the defendants and each of them shall not:

(a) Interfere with the conduct of the business of the first plaintiff by the second and third plaintiffs.

(b) Make or vary contracts or arrangements on behalf of the first plaintiff.

(c) Represent to others that he or she has authority to make or vary contracts or arrangements on behalf of the first plaintiff.

13. The defendants’ notice of motion dated 22 November 2010 be dismissed.

14. The parties participate in a further mediation, to be conducted on a date to be fixed.

15. The undertaking given by the second and third plaintiffs on 31 March 2010 at A(ii) be varied to include the words “other than for effecting a variation of the mortgage on the Adelaide property”.

16. On or before 4 pm on 6 December 2010 the plaintiffs file and serve, and on or before 4 pm on 8 December 2010 the defendants file and serve, any submission regarding the form of orders and related matters in relation to the interim management regime proposed in the reasons for decision of Dodds-Streeton J of 3 December 2010.

17. On or before 4 pm on 6 December 2010 the plaintiffs file and serve, and on or before 4 pm on 13 December 2010 the defendants file and serve, a brief submission on the feasibility of determining the disputed construction of the memorandum and articles as a preliminary question pursuant to Order 29 of the Federal Court Rules, including a brief statement of the issues likely to arise, whether any and if so what evidence may be required and an estimate of the hearing time required.

18. The defendants pay the plaintiffs’ costs of the plaintiffs’ notion of motion dated 16 November 2010.

Note:

Background

Background to the litigation

The affidavits in opposition to the plaintiffs’ notice of motion and in support of the defendants’ notice of motion were:(a) The affidavit of Claudia Sue Alister sworn 19 November 2010.(b) The affidavit of Dayashankar Tiwari sworn 19 November 2010.(c) The affidavit of Michael James May sworn 22 November 2010.BACKGROUND The present applications must be understood in the context of the developments in the proceeding since its commencement in March 2010. Some of the background is set out in my reasons for judgment dated 3 June 2010 (Ananda Marga Pracaraka Samgha Ltd v Tomar [2010] FCA 565) at [10]-[14] and [18]-[23]. The first plaintiff, Ananda Marga Pracaraka Samgha Ltd (“the company”), is a company limited by guarantee which has, since its inception, operated as a vehicle for the operations and activities of adherents of the Ananda Marga religion. The memorandum of the company originally stated that its objects include, inter alia:a.To propagate the ideals, the philosophy and practice of ANANDA MARGA.b.To carry out the objectives of the company through discourses, open addresses, personal contacts and through the medium of literature and such other means as may assist in the fulfilment of the objectives of the “the company”.c.To work for the development of a universal society and the welfare of all human beings through:i.Social service.ii.Relief work among suffering humanity.iii.Primary, secondary and tertiary schools and pre-school facilities such as kindergartens and child-minding centres.iv.Encouraging literacy and artistic faculties.v.Homes for the aged and physically and mentally handicapped.vi.Hospitals and other medial services.vii.Spiritual, moral and cultural upliftment.viii.Development of integrated human personalities embracing all spheres of life, social, individual and married.ix.And such other means as may assist in the fulfilment of the above objectives.d.To exert and expend all its resources for the purpose of expansion of the company, social services, and universal and world unity.e.To provide all the above types of services without any form of discrimination based on race, religion or sex. In 1992 the memorandum was amended to amend the objects as follows:1. Clause 2(a) be amended by deleting the full stop after the words "Ananda Marga" and adding the words "which is an autonomous religion, faith and social system based upon the teachings of the Founder and Preceptor of Ananda Marga, Shri P.R. Sarkar, also known as Shrii Shrii Anandamurtii. The religious doctrine, faith, moral canons and creed of Ananda Marga being contained in the scriptures given by the Founder including but not limited to: The Supreme Command, Ananda Sutram, Guide to Human Conduct, Subhasita Samgraha and Ananda Marga Carva Carva I, II and III. The Articles of Faith, and religious doctrines of Ananda Marga are:i.The belief in One, Infinite, Supreme Entity which in the Sanskrit language is referred to as Parama Purusa.ii.The belief that through the twice daily practice of Ananda Marga meditation the Supreme, Infinite Being may be fully and personally realised by the individual.iii.Meditation and hence realisation of the Supreme, Infinite Being is dependent upon the proper application of cardinal moral principles (Yama and Niyama) in the individual's life.iv.It is a duty of the highest order to encourage all persons to practice Ananda Marga meditation and to follow a life of virtuous and righteous conduct.v.Engaging in selfless, humanitarian service dedicated to the relief of human suffering whether it be physical, mental, or spiritual is indispensable in the individual's progress toward the realisation of the Supreme, Infinite Entity,"2. Clause 2(c) be amended by deleting clause 2(c)(ix) and inserting after clause 2(c)(viii) the following words:"(ix) Conducting the religious functions of Ananda Marga including collective meditation services, marriages, baby namings, funerals, and religious holidays.(x) Providing for the training, ordination and ongoing maintenance of religious ministers of Ananda Marga for the purposes of instruction and guidance of members in the doctrines, faith, and practices of Ananda Marga.(xi) And such other means as may assist in the fulfillment of the above objectives."…4. That clause 3 be amended by adding at the end of the clause after the words "any share of profits he/she may receive in respect of such payment." the following words:"Provided further that nothing herein shall prevent the company from fulfilling its fiduciary, equitable and legal duties and obligations in relation to property and any income therefrom that it holds as custodian trustee or otherwise on trust for any person, association, institution, venture or enterprise, whether incorporated or unincorporated."…

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Should subsequent developments require the company to assume an active role in the litigation, it will be necessary to consider whether it should be represented separately from the second and third plaintiffs. In my opinion, however, there are presently no sufficient grounds for granting the relief sought in the defendants’ notice of motion.CONCLUSION In my opinion, the relief sought in the plaintiffs’ notice of motion should be granted. The relief sought in the defendants’ notice of motion should be refused.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.