Hewett v Royal Volunteer Coastal Patrol

[2001] NSWSC 1140

CITATION:

Hewett & Ors v Royal Volunteer Coastal Patrol [2001] NSWSC 1140

CURRENT JURISDICTION:

Equity Division

FILE NUMBER(S):

SC 4719/99

HEARING DATE(S):

10 December 2001

JUDGMENT DATE:

11 December 2001

PARTIES :

Frederick James Hewett
(First Plaintiff)

Robert Silberberg
(Second Plaintiff)

Robert George Walker
(Third Plaintiff)

Thaddeus Murphy
(Fourth Plaintiff)

v

Royal Volunteer Coastal Patrol
(Defendant)

JUDGMENT OF:

Davies AJ at 1

COUNSEL :	Ps: Mr S R Donaldson SC, Mr T P Duggan D: Mr A T McInnes QC, Mr G D McDonald
SOLICITORS:	Ps: J B Malfanti D: Moore & Associates
CATCHWORDS:	Clubs and Associations - expulsion of members - conduct prejudicial - whether implication that expulsion be reasonable - function of the court - whether resolution invalid because director over 72 years of age in breach of Corporations Law.
LEGISLATION CITED:	Corporations Law, ss 228, 592 Supreme Court Rules, Pt40
CASES CITED:	Fisher v Keane (1879) 11 ChD 353 Dawkins v Antrobus (1881) 17 ChD 615 Paton v Sydney Press Club (1940) 57 WN(NSW) 57 Australian Workers' Union v Bowen (No2) (1948) 77 CLR 601 Malone v Marr (1981) 2 NSWLR 894 Whittle v Australian Miniature Pony Society Incorporated (1995) 57 FCR 252 Autodesk Inc v Dyason (No2) (1993) 176 CLR 300 Minister for Immigration and Multicultural Affairs v Bhardwaj (2000) 99 FCR 251 Ridge v Baldwin [1964] AC 40 Samuel v St George Leagues Club Limited (NSWSC, 20/10/92, unrep)
DECISION:	See paragraph 41

IN THE SUPREME COURT
OF NEW SOUTH WALES
Equity DIVISION

DAVIES AJ

11 DECEMBER 2001


4719/99 - FREDERICK JAMES HEWETT & ORS
v
ROYAL VOLUNTEER COASTAL PATROL

JUDGMENT

1 DAVIES AJ: The Royal Volunteer Coastal Patrol (“the RVCP”) was, in May 1963, incorporated as a company limited by guarantee. It took over the assets and assumed the liabilities of the previously unincorporated body known as the “Volunteer Coastal Patrol”. Relevant objects in its Memorandum of Association read as follows:-

“(e) to bring together yachtsmen and all persons interested in small ships so that they might acquire a better understanding of nautical matters generally and of the handling of small ships in particular;

(f) by precept and example to train and educate yachtsmen so that waterways may be made safer for those who sail upon them in small ships;

(g) to carry out either at the request or direction of any authority concerned or otherwise maritime rescue work and to train personnel for such work;”

2 In 1998, the first and second plaintiffs, Frederick James Hewett and Robert Silberberg, were members of the Council of the RVCP. Each resigned after forming the view that he should not continue to be a member of the Council. Each wrote to Divisional Commanders, in the area which he represented, a letter to be distributed to members in the area. The letter stated:-

“As a result of the Board Meeting of the RVCP at Sydney on 24 October 1998 I would like, through you to advise all members, that for ethical reasons I am unable to continue to represent them.

Events at this meeting offended my sense of fair play and will not allow me to continue associating with such a group of persons whose sole aim appears to be to impose their values on all members at what ever cost.

There was little regard by members of the Board (except the Directors for Victoria and Tasmania) for the Statutes and Memorandum and Articles of Association (The Companies Constitution) under which a Board must at all times operate. There appeared to be little regard for the processes of the RVCP. It was obvious at this meeting that a group of Members were illegally imposing control on the operations and administration of the RVCP.

The ultimate insult was when they tried to hear charges against the Officer Commanding and the Chairman of the AGM, without tabling details of the charge being made. Three Board members myself included refused to participate. When the former Chairman objected, he was asked to leave the room by Director Bill Kerkhoff (supported by the Chairman) As the matter concerning the Officer Commanding could be sub-judice. I stated that it should not be heard. It was indicated that the matter would still be heard. I said I would take no part in what I considered to be a Kangaroo Court and left the room.

They dismissed the Company Secretary Mr Derek Lawson without reason or even giving due notice. They appointed Mr Peter Weston of Broken Bay who is also the Director for the Central Region. They are talking of appointing their own auditor. Decisions are being made on advice from the Chairmans (Jenkins) personal Solicitor, who has been sending letters threatening legal action against the former Chairman, OC, Secretary and the Board on behalf of Jenkins re the NSW Government Grant.

I would like to remain as your representative to ensure your rights are upheld but with the existing gerrymander, my vote would be of no consequence. I am unable on moral grounds to continue as part of this Board as I would be considered legally as a party to decisions and actions I cannot condone. I will need to consider carefully the timing of my resignation as the Articles allow the Board to replace me with any person of their choice, unless two or more Directors resign at the same time. I am available if required to discuss this matter and answer questions.”

3 The Articles of Association of the RVCP provided:-

“15. If any member shall wilfully infringe any of the Articles of the Patrol or the by-laws thereof or be (in the opinion of the Council) guilty of any conduct prejudicial to the interests of the Patrol or be guilty of conduct which in the opinion of the Council shall render him unfit for membership the Council shall have power to reprimand suspend accept the resignation of or expel such member and remove his name from the register of members . No member shall be reprimanded suspended or expelled unless such member shall by notice in writing by A.R. letter posted to his last known address be notified of the charge against him at least fourteen days before the meeting of the Council at which such charge is to be heard. The member charged shall be entitled to attend the meeting for the purpose of answering the charge. The voting by the members of the Council present shall be by ballot and no motion by the Council to reprimand suspend or expel a member shall be deemed to be passed unless at least two-thirds of the members of the Full Council vote in favour of such motion . If the member fails to attend at the time and place mentioned without reasonable excuse the Councill will decide on the evidence before it his absence notwithstanding. Any decision o the Council on such hearing or any adjournment thereof shall be final and the Council shall not be required to assign any reason for its decision. The Council may at its discretion order the refund of any subscription or any part of it to any member during the current financial year in which he shall be expelled or suspended.”
(Emphasis added)

4 On 1 April 1999, the secretary of the RVCP wrote to both Mr Hewett and Mr Silberberg as follows:-

“You are hereby summoned under section 15 of the Articles of Association of the Royal Volunteer Coastal Patrol to appear at the next RVCP Council meeting to be held at the RVCP Headquarters 239 Spit Road, Mosman NSW 2088 on Saturday 17th April 1999 to investigate allegations that in writing and sending out letters containing material detrimental to the RVCP you are guilty of conduct prejudicial to the Royal Volunteer Coastal Patrol.”

5 Neither Mr Hewett nor Mr Silberberg attended the meeting on 17 April 1999. Shortly thereafter, Mr Hewett and Mr Silberberg were each informed that the Council had resolved at its meeting on 17 April 1999, “that your membership be terminated and that your name be removed from the register of members forthwith”.

6 On 3 May 1999, the solicitor for the plaintiffs wrote to the solicitors for the RVCP, advising that their clients had been given insufficient notice to attend the meeting of 17 April 1999. The Council of the RVCP declined to reinstate Mr Hewett and Mr Silberberg. These proceedings were instituted on 18 November 1999. The Summons sought, inter alia, a declaration that Mr Hewett and Mr Silberberg had not been given the notice required by Article 15 of the Articles of Association, that the resolution had not been passed by at least two-thirds majority of the Full Council, that the Council had not afforded procedural fairness to Mr Hewett and Mr Silberberg and that each decision to terminate the membership “was not reasonable and … is void”.

7 It is not now in dispute that there were procedural irregularities in the calling of the meeting on 17 April 1999. Mr S R Donaldson SC, with whom Mr T P Duggan of counsel appeared for the RVCP, conceded, after taking instructions from his client, that the resolutions of 17 April 1999 were void and that a declaration to that effect should be made.

8 Mr Hewett was subsequently advised by letter dated 27 April 2000, signed by the secretary of the RVCP, that:-

“At a meeting on 26th April, 2000 the Council of the Patrol resolved that:

1. the findings of the Council on 17th April, 1999 that Hewitt and Silberberg were guilty of the charges laid under Article 15 and the resolutions made by the Council on 17th April, 1999 to expel Messrs Hewitt and Silberberg be rescinded without admission that the findings and/or resolutions were invalid.

2. Mr Hewitt be charged, under Article 15, as follows:
that by distributing to members of the Patrol a letter, a copy of which is attached and Marked ‘A’, Mr Hewitt was guilty of conduct which was prejudicial to the interests of the Patrol or which was such as to render him unfit for membership of the Patrol.”

A similar letter was sent to Mr Silberberg.

9 Attached to that letter was a notice under Article 15 of the Articles of Association which read as follows:-

“On the 26th April, 2000 at a meeting of the Council of the Royal Volunteer Coastal patrol the Council resolved that you be charged under Article 15, as follows:

That by distributing to members of the Patrol a letter, a copy of which is attached and marked ‘A’, you are guilty of conduct which was prejudicial to the interests of the Patrol or which was such as to render you unfit for membership of the Patrol. We also attached a copy of Article 15.

You are hereby notified that the Council will hear the charge and determine any penalty at 14.30 on Saturday 27th May 2000.

You are entitled to attend that meeting for the purpose of answering the charge. The Council will decide whether you are guilty of the conduct after the hearing and on that day.

If you are found guilty of the charge, the Council will invite you to make submissions as to the appropriate penalty immediately following any finding that the charge has been made out.

If you fail to attend at the time and place mentioned without reasonable excuse the charge may be heard and dealt with and a penalty imposed by the Council in you [r] absence.”

The letter attached to the notice was the letter which I have set out above.

10 The meeting of 27 May 2000 was adjourned to 17 June 2000 and, in the meantime, the following particulars were given by the solicitors for the RVCP:-

“As to the third matter, the charge is that the letter distributed by Mr Silberberg contained a number of unfounded, false or misleading allegations to the effect that the affairs of the Patrol were being conducted by the Council in an improper manner and contrary to the interest of the Patrol.

Those allegations are as follows:

That the Council and Councillors (apart from the Councillors for Victoria and Northern NSW):

· were unethical (Paragraph 1, line 2);

· behaved in a manner which was contrary to fair play and professionalism (Paragraph 2, line 1);

· had only one motive, which was to take control of all aspects of the Patrol and to impose on all members their values (Paragraph 2, lines 2 and 3);

· paid scant regard for Statutes and Memorandum and Articles of Association (Paragraph 3, lines 1 and 2);

· gave little apparent recognition to the process of the Patrol (Paragraph 3, line 3);

· lacked integrity (Paragraph 4, line 3);

· illegally imposed control on the operations and administration of the Patrol (Paragraph 4, line 4);

· imposed a ‘Kangaroo Court’ on the Officer Commanding (Paragraph 5, line 1);

· imposed a ‘gerrymander’ (Paragraph 7, line 2) and

· were immoral (Paragraph 7, line 2).

As to the fourth matter, the charge is that the distribution of those unfounded, false or misleading allegations were prejudicial to the interests of the Patrol by creating or being likely to create disunity, controversy and ill feeling amongst the members and to affect the capacity of the Patrol to achieve its functions and objects. Further, the charge is that conduct was such as to render Mr Silberberg unfit for membership of the Patrol.”

11 Mr Hewett and Mr Silberberg did not attend the meeting on 17 June 2000. It was resolved that their memberships of the RVCP be terminated. The minutes of the meeting of 17 June 2000 recorded, in relation to Mr Silberberg, that, “The results of the secret ballot were a unanimous vote that the charges had been proved”. In relation to Mr Hewett, the minutes recorded, “Directors were asked to record their vote in the secret ballot. The result of the secret ballot was a unanimous – guilty to the charge”. In these proceedings, no issue has been made of the fact that there were alternative charges, namely, “guilty of conduct which is prejudicial of the interests of the Patrol” and “guilty of conduct … which was such as to render you unfit for membership of the Patrol”. As the Council resolved that Mr Hewett and Mr Silberberg be expelled, it may be inferred that the members of the Council had come to the view that Mr Hewett and Mr Silberberg were guilty of conduct which was prejudicial to the interests of the RVCP and also of conduct which was such as to render them unfit for membership. In any event, no challenge has been made to the resolutions on the ground that the Council did not differentiate between the two grounds.

12 As I have mentioned in paragraph [6], the Summons contended that the decisions to terminate the memberships of Mr Hewett and Mr Silberberg were not reasonable and therefore were void. There are two aspects concerning this allegation that I should mention. One is that neither male fides nor bias was alleged in the Summons. The other is that, in proceedings such as these, it is not the function of the Court to form its own view as to whether or not the resolutions of the Council were reasonable. The jurisdiction which the Court has is to protect the plaintiffs’ contractual and proprietary rights. Although it has long been established that expulsion provisions such as that found in Article 15 necessarily imply the rules of natural justice, it is not the case that it is implied in such a provision that any decision to expel will be reasonable. The authorities are indeed to the contrary.

13 In Fisher v Keane (1879) 11 ChD 353, it was held by Jessel M R that the rules of natural justice must be complied with if a member is to be expelled from a club. At p 362, his Lordship said:-

“… in my opinion a committee, acting under such a rule as this, are bound to act, as Lord Hatherley said, according to the ordinary principles of justice, and are not to convict a man of a grave offence which shall warrant his expulsion from the club, without fair, adequate, and sufficient notice, and an opportunity of meeting the accusations brought against him.”
That principle has consistently been applied since that time and in this case it was the failure of the Council to observe such procedures which led Mr Donaldson to concede that the resolutions of 17 April 1999 should be declared to be void.

14 However, on the issue of reasonableness, the authorities are clear that, if a council or a committee has power to act in certain circumstances, it is not for the court to substitute its own view as to what the council or committee ought to have done. In Dawkins v Antrobus (1881) 17 ChD 615, Jessel M R declined to intervene in an expulsion case although, in the course of his reasons, his Lordship said, at p 624, “… I cannot, as far as I am concerned, imagine how this single act could be injurious to the character and interests of the club”. His Lordship concluded that he could not impute legal malice to the committee and went on to say:-

“I do not feel that it would be right to say that the committee were so unreasonable as to act entirely without reasonable and probable cause, or so corruptly biased and unfair as to knowingly state that to be their opinion which was not their opinion, fairly arrived at so far as their light and information enabled them to arrive at an opinion adverse to Colonel Dawkins.”

15 An appeal was disallowed by James, Brett and Cotton LLJ. At p 629, James LJ said:-

“Unless we can say that their decision that such conduct would be injurious to the character and interests of the club was so manifestly absurd and so manifestly idle that it could only have been a false pretence to cover something else, and therefore was, in fact, fraudulently put forward for the purpose of giving effect to some preconceived notion of removing him without just cause – for which I can see no ground or foundation whatever – we have no right to sit in judgment on their decision.”

16 At p 636, Cotton LJ expressed the question in these terms:-

“The substantial question remains, namely, has it been made out that what was done was not in the fair exercise of the power given by the rule, and that it was done, not bona fide or honestly, but maliciously, or that there was a denial of natural justice?”

17 In Paton v Sydney Press Club (1940) 57 WN(NSW) 57, Jordan CJ, expressing the judgment of the Court, rejected the contention that it was for the Court to examine whether it was unreasonable for the board of the corporation to form the opinion which it did. His Honour said, at p 58:-

“In such a case, the question whether the Board’s decision is unreasonable becomes relevant only where the reason which it states for its opinion can be regarded as so obviously absurd that it may be inferred that it was not really of the opinion at all. An opinion which is sought to be supported only by an obvious absurdity may fairly be regarded as never having existed.”
His Honour cited from the judgments of James LJ and Cotton LJ in Dawkins v Antrobus .

18 Recent authorities have proceeded along the same lines. In Australian Workers’ Union v Bowen [No. 2] (1948) 77 CLR 601, Dixon J said, at p 628:-

“Members may act upon their own knowledge and upon hearsay if they are satisfied of the truth of what they so learn and if they give the member with whom they are dealing a proper opportunity of answering the charge and defending himself. The tests applied to juries’ verdicts, namely, whether there was evidence enabling a reasonable man to find an affirmative or whether upon the evidence a finding was unreasonable, have no place in the examination of the validity of such a domestic tribunal’s decisions. But the tribunal is bound to act honestly, that is to say it must have an honest opinion that what the member before it did amount to misconduct and its decision must be given in the interests, real or supposed, of the body it represents and not for an ulterior or extraneous motive (cf. Maclean v The Workers’ Union (1929) 1 Ch D 602, at pp 620-627; Stuart v Haughley Parochial Church Council (1935) Ch 452, at p 462; (1936) Ch 32; Lamberton v Thorpe (1929) 141 LT 638.”

19 In Malone v Marr (1981) 2 NSWLR 894 at 899, Holland J said:-

“As I have tried to make clear, it is not the court’s function to decide whether the plaintiff’s statements to the press were or were rightly to be regarded as prejudicial to the interests or welfare of the club. That was for the committee to decide. Expressly, I do not decide that; but I do decide that the plaintiff’s conduct complained of was capable of being considered to be prejudicial to the club’s interest and welfare.”

20 More recently, Burchett J reviewed the authorities in Whittle v Australian Miniature Pony Society Incorporated (1995) 57 FCR 252. His Honour expressed like views to those which I have set out above.

21 Mr A T McInnes QC, with whom Mr G D McDonald of counsel appeared for the plaintiffs, did not cavil with the point that Article 15 expressly conditions the exercise of the discretion upon the “opinion of the Council”. Mr McInnes submitted, however, that the letters which Mr Hewett and Mr Silberberg distributed were derogatory of the Council itself and not of the RVCP. He submitted that the plaintiffs’ conduct could not be regarded as “prejudicial to the interests of the Patrol” or such as to render the plaintiffs “unfit for membership” as the letters did not reflect upon the RVCP or its functions but only upon the members of the Council. Mr McInnes submitted that the comments which were the subject of consideration in Malone v Marr were directed at the team of the North Sydney District Rugby League Football Club and therefore could be regarded as disparaging of the Club itself. Mr McInnes referred to the objects of the RVCP set out in the Memorandum of Association, to some of which I have referred. He submitted that there was nothing in the letters which was prejudicial to the attainment of the aims and objects of the RVCP.

22 In my opinion, the words of Article 15 have an ambit much wider than that of which Mr McInnes contended. Thus, in Dawkins v Antrobus, the letter complained of had been one which was disparaging of a member of the Club, not of the Club itself or of its committee. In Whittle v Australian Miniature Pony Society Incorporated, the conduct in question was very much of the type complained of in the present case, although more restrained. At pp 257-258, a circular letter written by Mrs Whittle is set out. The letter complained of alleged failures by the Committee of the Society, including failures of a procedural character and failure to act with care, diligence and skill.

23 In the present case, it was, in my view, open for the Council to form the view that the distribution of the letters by Mr Hewett and Mr Silberberg was conduct which was prejudicial to the interests of the RVCP and conduct which rendered them unfit for membership.

24 Any reflection upon the Council or the members of the Council of the RVCP was necessarily a reflection upon the organisation itself as the Council was its controlling mind. The undermining of confidence in its Council could be considered to be prejudicial to the RVCP. The subject letters referred to a failure of “fair play”. They referred to a failure to have regard to the Memorandum and Articles of Association and to the Corporations Law. They referred to “illegally imposing control”. They referred to “a Kangaroo Court”. They referred to “the existing gerrymander”. The substance of the letters was that, in the circumstances, the letter writer could not continue to be a member of the Council “for ethical reasons”. The language used was extremely strong. It could be regarded as being inappropriate and “over the top”. In my opinion, it was open to the Council to form the view that the writing of those letters was unacceptable conduct for a member of the RVCP.

25 In any event, I must return to the point that the ultimate question is not whether it was open to the Council to form that view but whether the Council did form the view. If it did and if it acted for a proper purpose and followed the appropriate procedure, then the decision of the Council must stand. Article 15 imposes the power to expel upon the Council and conditions the exercise of the power upon the opinion of the Council. If the Council formed the appropriate opinion, it was entitled to act in accordance with Article 15. A challenge on the basis that it was not open to the Council to form the view which it did must so undermine the view of the Council as to show that the opinion was formed for an improper purpose or was so absurd or flawed that it was no opinion at all. That is not the position in the present case.

26 The basic point is that the crucial words used in Article 15 were ordinary words of the English language and had the meaning which they carry in ordinary parlance. The question whether the conduct of Mr Hewett and Mr Silberberg fell within the words was not a question of law but one of fact. The determination of that question of fact was committed to the opinion of the Council. The minutes of the meeting of 17 June 2000 show that the Council formed the requisite opinion. In the absence of male fides or procedural irregularity, the opinion as recorded in the minutes must be conclusive unless it is established that the opinion was, in reality, not a requisite opinion. In the present case, that has not been demonstrated.

27 Mr McInnes further submitted that the resolutions of 17 June 2000 were void because Mr Hewett and Mr Silberberg were not, at the time, members of the RVCP. The argument was put on two bases. One was that the Council of the RVCP had no power to revoke its first determination and the other was that Mr Hewett and Mr Silberberg were not members of the RVCP at the relevant time as they had not paid their membership subscriptions, which were due once they were reinstated as members.

28 The first submission necessarily fails as the Court will declare that the resolutions of 17 April 1999 were void and the declaration will take effect ab initio. In any event, there is substantial authority for the existence of a power of reconsideration in a case where a full and proper hearing of allegations has not been had or has miscarried. So far as courts are concerned, it is sufficient to refer to Pt 40 r 9 of the Supreme Court Rules and the more general power, only sparingly exercised, which was discussed in Autodesk Inc. v Dyason (No.2) (1993) 176 CLR 300. So far as tribunals are concerned, Beaumont and Carr JJ, Lehane J dissenting, in Minister for Immigration and Multicultural Affairs v Bhardwaj (2000) 99 FCR 251, upheld a decision of the Immigration Review Tribunal to reconsider a matter in the circumstance that the applicant had not attended a hearing of the Immigration Review Tribunal but had written a letter advising that he was sick and would like to appear at a later date. The letter had not been brought to the attention of the member constituting the Tribunal. The High Court of Australia has granted leave to appeal in Bhardwaj’s case and that Court will consider whether or not the Tribunal, which functioned under statutory powers, had an inherent or implied power similar to that which is exercised by courts.

29 The Council of the RVCP was not limited to statutory powers. In my opinion, the Council of the RVCP, which had ongoing responsibility for the management of the affairs of the RVCP, had both the authority and a duty to exercise its powers in a sensible and practical manner and, therefore, power to accept that a decision which it had made was invalid for breach of the Articles of Association or of the rules of natural justice and so to deal with and to reconsider the matter properly as it ought to have done in the first place.

30 Thus, in Ridge v Baldwin [1964] AC 40, Lord Reid said, at p 79:-

“I do not doubt that if an officer or body realises that it has acted hastily and reconsiders the whole matter afresh, after affording to the person affected a proper opportunity to present his case, then its later decision will be valid. An example is De Verteuil … [v Knaggs] [1918] AC 557.”

31 Accordingly, I do not accept that the resolutions of 17 June 2000 were invalid on the ground that the Council did not have power to rescind its earlier resolutions and to reconsider the matter.

32 Nor do I accept the submission that the failure to pay the membership fee of itself operated as a cessation of membership. Article 13, which I need not set out, is inconsistent with this submission. The Articles draw a clear distinction between membership and financial membership.

33 The only procedural aspect which was pursued at the hearing is that one of the councillors, Mr John McInerney, had been appointed a member of the Council when he was over the age of 72 years. Section 228(1) of the Corporations Law provided that a person who had attained the age of 72 years should not be appointed to act as a director of a public company. As the RVCP was a company limited by a guarantee and was not a proprietary company, it was a public company for the purposes of s 228(1). However, s 228(4) provided:-

“(4) An act done by a person as a director is valid notwithstanding that it is afterwards discovered that he or she had attained the age of 72 years at the time of his or her appointment or that his or her appointment had terminated by virtue of subsection (3).”

34 There were eleven persons present at the Council meeting on 17 June 2000. This comprised all members of the Council plus the Officer Commanding, who, under Article 92, was entitled to attend meetings of the Council. Article 15 provided that the Council may resolve to expel a member provided that resolution was passed by two-thirds of the Full Council. The Article thus required a vote of seven members of the Council. In the present case, the resolutions were so passed, even if Mr McInerney’s vote should be disregarded.

35 In my opinion, Mr McInerney was a member of the Council at the relevant time and his vote was properly taken into account. It was saved from invalidity by s 228(4) of the Corporations Law, notwithstanding that there was a defect in his appointment.

36 Mr McInnes relied upon the judgment of Powell J in Samuel v St George Leagues Club Limited (NSWSC, 20 October 1992, unreported) where his Honour included amongst a list of procedural requirements, in a case such as the present, the following:-

“7. An accused person’s right to an unbiased tribunal entitles him:-


…

(b) to have strangers excluded from taking part in the tribunal deliberations (see Macsween v Fraser (1956) 1 FLR 10; Steuart v Oliver (No.1) (1971) 19 FLR 99; Ethell v Whalan (1971) 1 NSWLR 416).”

37 Mr McInnes submitted that Mr McInerney was a “stranger” to the proceedings before the Council as there was a defect in his appointment. However, Mr McInerney was a member of the Council, although his appointment could have been challenged. He was not a “stranger” to the proceedings within the principle to which Powell J adverted.

38 I need not discuss the many other issues raised in the Further Amended Summons as they were not pursued by Mr McInnes.

39 At the commencement of the proceedings, Mr McInnes announced that relief was sought only by the first two plaintiffs and that the third and fourth plaintiffs, Mr R G Walker and Mr T Murphy, no longer had an interest in the proceedings.

40 Costs are a difficult matter but I have formed the view that each party should pay his or its own costs. Mr Hewett and Mr Silberberg have had some success for it was not until the hearing that the defendant conceded that the 1999 resolutions were void. On the other hand, Mr Hewett and Mr Silberberg lost on the matters of substance which they pursued at the hearing. I would have ordered that Mr Hewett and Mr Silberberg pay the majority of the defendant’s costs of the proceedings save that I have come to the conclusion that the Council was somewhat heavy-handed in the way in which it dealt with the matter. Its actions had a tendency to precipitate the litigation. In the circumstances, I consider that it is fair that each party should abide his or its own costs.

41 For these reasons, the Court orders:-

(a) that the resolutions of 17 April 1999, expelling Mr Hewett and Mr Silberberg, be declared void;

(b) that the application to the Court be otherwise dismissed;

(c) that each party abide his or its own costs.

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Last Modified: 12/21/2001