Kaur v Sikh Gurdwara Perth (Inc)
[2017] WASC 270
•21 SEPTEMBER 2017
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CIVIL
CITATION: KAUR -v- SIKH GURDWARA PERTH (INC) [2017] WASC 270
CORAM: LE MIERE J
HEARD: 3-6 APRIL 2017
DELIVERED : 21 SEPTEMBER 2017
FILE NO/S: CIV 2632 of 2015
BETWEEN: KARAMJIT KAUR
First Plaintiff
LAKHBIR SINGH SIDHU
Second PlaintiffAMRIT PAL SINGH
Third PlaintiffAND
SIKH GURDWARA PERTH (INC)
Defendant
Catchwords:
Associations and clubs - Standing - Where plaintiffs applied for membership of the defendant association - Whether there is a contractual relationship between the plaintiffs and the defendant association - Whether the plaintiffs had a legitimate expectation that decisions would be made in accordance with the defendant association's rules - Nature of interest sufficient to ground standing for a non-member of a voluntary association
Remedies - Declaration - Overriding discretion - Exercise of discretion to refuse grant of a declaration
Natural justice - Whether there has been a contravention of the rules of natural justice
Practice and procedure - Pleading - Whether plaintiff's case adequately pleaded
Legislation:
Associations Incorporation Act 1984 (Qld)
Associations Incorporation Act 1987 (WA)
Associations Incorporation Act 2015 (WA)
Health Act 1911 (WA), s 178
Supreme Court Act 1935 (WA), s 25(6)
Result:
Claim dismissed
Category: A
Representation:
Counsel:
First Plaintiff : Mr I R Freeman
Second Plaintiff : Mr I R Freeman
Third Plaintiff : Mr I R Freeman
Defendant: Mr M W Fatharly & Ms A L Spencer
Solicitors:
First Plaintiff : Lavan Legal
Second Plaintiff : Lavan Legal
Third Plaintiff : Lavan Legal
Defendant: Kott Gunning
Case(s) referred to in judgment(s):
Ainsworth v Criminal Justice Commission (1992) 175 CLR 564
Baker v Liberal Party of Australia (SA Division) (1997) 68 SASR 366
Blackler v New Zealand Rugby Football League (Inc) [1968] NZLR 547
Cameron v Hogan (1934) 51 CLR 358
Carberry v Drice as Rep of Brisbane Junior Rugby Union (An unincorporated Body) [2011] QSC 016
Croome v Tasmania (1997) 191 CLR 119
Echunga Football Club Inc v Hills Football League Inc [2014] SASC 201
Egan v Willis (1998) 195 CLR 424
Finnigan v New Zealand Rugby Football Inc [1985] 2 NZLR 159
Forbes v New South Wales Trotting Club Ltd (1979) 143 CLR 242
Forster v Jododex Australia Pty Ltd (1972) 127 CLR 421
Harrison v Hearn [1972] 1 NSWLR 428
Islamic Council of South Australia v Australian Federation of Islamic Councils Inc [2009] NSWSC 211
Johnco Nominees Pty Ltd v Albury-Wodonga (NSW) Corporation [1977] 1 CSWLR 43
Lawton v Bidgerdii Aboriginal & Torres Strait Islanders Corp Community Health Service Central Queensland Region [2004] FCA 1474
McClelland v Burning Palms Surf Life Saving Club (2002) 191 ALR 759
McInnes v Onslaw-Fane [1978] 1 WLR 1520; [1978] 3 All ER 211
Mutasa v Attorney-General [1980] QB 114
Parramatta CC v Sandell [1973] 1 NSWLR 151
Rose v Boxing NSW [2007] NSWSC 20
Russian Commercial and Industrial Bank v British Bank for Foreign Trade Ltd [1921] 2 AC 438
Shergrill v Khaira [2014] UKSC 33; [2015] AC 359
Stininato v Auckland Boxing Association (Inc) [1978] 1 NZLR 1
Thorpe v Commonwealth of Australia (No 3) [1997] HCA 21; (1997) 72 ALJR 767
Typing Centre of New South Wales v Toose (Unreported, NSWSC, 15 December 1988)
Woodford v Smith [1970] 1 WLR 806
LE MIERE J:
Summary
The defendant is a voluntary association incorporated under the Associations Incorporation Act 1987 (WA) (the Act) (now replaced by the Associations Incorporation Act 2015 (WA)). Each of the plaintiffs is a Sikh who has sought and been refused membership to the defendant.
The plaintiffs are seeking a 'declaration that the [d]efendant failed to assess the [p]laintiffs' applications in accordance with the [defendant's] [r]ules' and costs. In response, the defendant argues the nature of the present dispute makes it inappropriate for judicial intervention, and that, even if the dispute is open to such intervention, that the defendant's assessment of the plaintiffs' applications was in accordance with the rules.
This case involves two central issues. First, whether the plaintiffs have standing to pursue their claim. Second, the proper construction to be given to the defendant's rules.
For the following reasons, I reject the plaintiffs' claim for a declaration.
The defendant and its rules of association
The defendant
The defendant became an incorporated association on 28 May 1996. At a meeting on 10 March 1996, a number of persons decided to establish a Gurdwara (Sikh temple) separate to that being operated by the Sikh Association of Western Australia Inc (SAWA). Some of these persons formed a Rules Committee and on 22 May 1996, a memorandum was circulated attaching for comment a set of draft rules of association. The 1996 rules are in substantially the same form as those that were lodged with the office of the Commissioner for Consumer Protection on 24 March 2010. The rules lodged with the Commissioner, the 'Sikh Gurdwara, Perth (Inc) Rules' (Rules) were operative at all material times.
The defendant manages two Gurdwaras, one located in Bayswater and the other in Bennett Springs. The Gurdwara in Bennett Springs was officially opened on 15 February 2015. The Bayswater Gurdwara ceased having services on 15 September 2015.
Defendant's rules
The defendant's rules describe it as 'a unique purpose association for believers of the "Sikh" religion' and continue that 'the spirit and intendment of the Rules are the promotion and tenets and principles of Sikh religion' (r 3.2). The defendant's objects are recorded in r 4.1 of the Rules:
The objects of the Association are to:
(a)promote the Sikh religion, education and culture;
(b)establish a Gurdwara and manage it according to 'Sikh Rehat Maryada';
(c)establish a Khalsa school for the advancement of the objects;
(d)organise social and sporting functions; and
(e)do such things as are incidental to the attainment of the objects.
A Gurdwara is defined as a 'Sikh temple', and the Sikh Rehat Maryada as 'the Sikh Code of Conduct adopted by [the defendant] as per schedule IV of the Rules' (r 3.1). 'Sikh' is defined as 'a person who believes in One God, Sri Guru Granth Sahib (the Sikh holy Book), teachings of the ten Gurus, and amrit (holy nectar)' (r 3.1).
The affairs of the defendant are managed by the 'Committee of Management' (Committee) (r 11.1). Rules 5.4 and 5.5 set out what is required of the Committee and r 5.6 specifies what powers the Committee has. Pursuant to r 11.5, the Board of Trustees (Board) oversees the Committee's compliance with the Rules and the Association Incorporation Act 1987 (WA) (the Act) (now replaced by the Associations Incorporation Act 2015 (WA)).
Membership of the defendant
Rule 7.1 provides that:
A Sikh above the age of 18 years who is interested in subscribing the objects of the Association, may submit an application to the General Sewada to become a Life member or Ordinary member or Student / Pensioner member.
Applications for membership are made by completing the application form attached to the Rules as Schedule I (r 7.3). On this form the applicant is to set out their name, that they are a Sikh and believe in 'one God … the Sri Guru Granth Sahib … [the] teachings of the ten Gurus … and amrit', that they are older than 18 years of age, and that they subscribe to the objects of the defendant and will abide by the Rules.
Applicants must be permanent residents of Australia or Australian citizens (r 7.3), and must pay a fee, the amount of which depends on the type of membership applied for. Life members must pay a once-only subscription of $200 (r 7.4), ordinary members an annual fee of $110 (r 7.5), and Student or Pensioner members an annual fee of $25 (r 7.6). Under r 7.3, '[t]he Committee reserves the right to deny membership if the applicant had any history or is likely to create problems to [the defendant] in attaining its goals [sic]'. Under r 7.2, the Committee can appoint a person as an honorary member where that person has 'rendered a substantial contribution to the welfare of the [defendant]', but that person is not entitled to any vote at the defendant's Annual General Meeting (AGM) (r 24.2).
Pursuant to r 25.2, the defendant and its members are bound by the Rules to the same extent as if every member and the defendant had signed and sealed the Rules and agreed to be bound by all of their provisions.
Benefits of membership of the defendant
It is common ground between the parties that non-members of the defendant are entitled to attend the defendant's Gurdwara and to undertake seva (service) and eat a meal in the Langar hall within the Gurdwara.
There are certain activities which, under the Rules, require membership of the defendant.
The first is voting at an AGM or Special General Meeting (SGM). The Committee must convene an AGM each year before the end of August, and has the power to convene SGMs (r 21.1). Under r 24.1, a 'Life member and his spouse, Ordinary member and his spouse, and Student/Pensioner member and his spouse present at a general meeting is entitled to a deliberative vote each'.
The second is the ability to stand for election to the Committee. The Committee has considerable powers to facilitate its coordinating the affairs of the defendant (r 5.6, r 11.1). Committee members are entitled to vote on issues at Committee meetings (r 20.2). Pursuant to r 11.6, the Committee is constituted as follows:
The Committee … shall consist of:
(a)Chief Sewadar
(b)Vice-chief Sewadar
(c)Stage Sewadar
(d)General Sewadar
(e)Assistant General Sewadar
(f)Treasury Sewadar
(g)Assistant Treasury Sewadar; and
(h)Not less than 2 other Sewadars, all of whom must be Life Members and there shall be at least 2 female Committee Sewadars. These Sewadars will be given Kitchen and General Maintenance responsibilities and any other responsibilities that are not covered by (a) to (h) Sewadars.
'Sewadar' is defined to mean attendant (r 3.1(r)). The Sewadars identified in (a) to (g) must be 'Kesadhari Sikhs' (r 11.7). That term is defined in Schedule IV of the rules as persons 'with unshorn hair' (Rules sch IV). Those Sewadars in (a) to (g) have additional powers and responsibilities articulated in the Rules. The '[n]ot less than 2 other Sewadars' identified in (h) do not need to be Kesadhari Sikhs. All members of the Committee must be life members who have had that status for at least two years (r 11.6, r 11.10). A bankrupt person is ineligible to hold a position on the Committee (r 11.14). To qualify for nomination for the position of Chief Sewadar, a person must have served on the Committee 'at least for two earlier years', and those nominating for positions in r 11.6(c), (d) and (f) must have served the Committee 'at least one earlier year' (r 11.10). Qualifying persons may nominate ahead of an AGM. If the position of Chief Sewadar is contested, the election of the members of the Committee is determined by each of the Chief Sewadar candidates forming a group ticket, or 'team'(r 11.10). The members of the ticket with a simple majority will become the Committee (r 11.10). If the position of Chief Sewadar is not contested, members of the Committee are elected by a secret ballot or by a show of hands (r 11.11).
The third is the ability to stand for election to the Board of Trustees. The Rules provide for a Board of Trustees (Board), the five members of which must be life members of the defendant (r 11.2). The Board is obliged to ensure that the Committee conforms to the Rules and the Act (r 11.5). Members of the Board, must be 'amritdhari', a term not defined in the Rules nor established in the evidence before the court (r 11.2). Members of the Board must also be life members, cannot be bankrupt, and are elected by secret ballet or by a show of hands (r 11.2, r 11.14, r 11.10).
Although asserted by counsel for the defendant, it is not apparent from the Rules that a person must be an amritdhari Sikh before they can be a member of the Committee.
The fourth is the ability to, together with more than one-third of the defendant's members, convene a special general meeting by written request (r 21.1).
The fifth is the inspection of the defendant's books. Registered members are entitled to, with seven days' notice, inspect the books, documents, records and securities of the Association (r 27).
The plaintiffs' applications
On 23 May 2015 the first plaintiff completed a membership application form. The first plaintiff testified that she gave this application form to a Mr Balbeer Singh, who returned the form to her and told her to send an application by post. The first plaintiff subsequently completed a further application form on 27 June 2015. On or about 13 July 2015 the first plaintiff posted the application to the defendant together with a cheque for $200. The first plaintiff's application was considered at a meeting of the defendant's Management Committee on 16 August 2015. The minutes of the 16 August 2015 Committee meeting record that the defendant had received a large number of applications (including that of the first plaintiff) and that all of these were rejected because:
(a)the applicants are 'unknown people who have no history of active attendance, involvement or participation with the [defendant] and its programs or activities';
(b)the defendant was at risk of breaching its capacity at the Bennett Springs Gurdwara;
(c)the applications were not submitted in person (the minutes record that earlier at this same meeting the Committee had resolved that applicants must apply in person); and
(d)the Committee suspected 'fraudulent activity' because of similarities in all of the applications, and believed that this 'fraudulent activity' could put the defendant at risk.
The first plaintiff's application was rejected by a letter of the defendant dated 21 August 2015, which cited the following reasons for the rejection:
(a)at the time the defendant had received a high volume of membership applications;
(b)the defendant did not have capacity to take on any new members as it already had 352 members and was at risk of breaching the maximum accommodation of its Gurdwara under the Health Act 1911 (WA) (a limit of 377 persons); and
(c)the defendant favoured applicants with a history of involvement with the defendant ‑ those regularly visiting the Gurdwara and with a demonstrated history of involvement.
In the letter, the first plaintiff was encouraged to 'increase and continue [her] involvement with the [defendant]'.
The second and third plaintiffs applied for membership of the defendant on 6 January and 11 January 2014 respectively. Their applications were both rejected by letters each dated 28 May 2014 following a meeting of the defendant's Management Committee on 25 May 2014 where it was resolved that their applications should be refused. The reasons for rejection stated in those letters, which are identical in substance, were that the second and third plaintiffs:
(a)did not visit the Bayswater Gurdwara and that was believed to be because the second and third plaintiffs are 'very busy' with their involvement in 'other organisations', including the defendant's 'sister and parallel organisation';
(b)the defendant favoured applications from recent migrants who follow the Sikh Rehat Maryada and are regular attendees of the defendant; and
(c)the defendant had reached a sufficient number of members and were 'looking to give chance to new migrants'.
The defendant admits that the reference to its 'sister and parallel organisation' is a reference to SAWA.
The proceedings
The proceedings were commenced by writ of summons filed 14 October 2015. Although the plaintiffs initially sought additional declarations, the plaintiffs now seek only a 'declaration that the Defendant failed to assess the Plaintiffs' applications in accordance with the SGP Rules' and costs.
The prejudice to the plaintiffs by the refusal of membership
Each of the plaintiffs gave evidence as to their reasons for wanting to become members of the defendant. The first plaintiff gave evidence that she wanted to be a member in order to help the community, and that as a result of her application being rejected, she was not able to participate or vote at the Defendant's 2015 Annual General Meeting. She conceded that as a non-member she is entitled to attend the defendant's Gurdwara on any day to pray and is able to do seva (service). The first plaintiff is not an amritdhari Sikh, so is ineligible to stand for election to the Board. There is no evidence as to whether the first plaintiff is a Kesadhari Sikh. In the absence of this evidence I can only conclude that she is entitled to stand for election to one of the 'not less than 2' other Sewadar positions on the Committee, provided for in r 11.6(h).
The second plaintiff gave evidence that he wants to be a member of the defendant so that he 'can feel that [he is] fully contributing to the community'. He is neither an amritdhari Sikh nor a Kesadhari Sikh. Therefore he is not able to stand for election to the Board, but if he were a member he would be entitled to stand for election to one of the 'not less than 2' other Sewadar positions on the Committee, provided for in r 11.6(h).
The third plaintiff testified that he wishes to be a member so that he can feel that he is fully contributing to the community and because he wants to be involved in decisions affecting the Sikh community at large, the Gurdwara, and the Indian community at large. Although he conceded in cross-examination that he is entitled to attend the Gurdwara and participate in events, he commented that as a non-member he cannot make suggestions directly to the Committee and must do it via a member. There is no evidence before the Court as to whether the third plaintiff is an amritdhari Sikh or a Kesadhari Sikh. Like the second plaintiff, if the third plaintiff were a member of the defendant he would be entitled to stand for election to a small number of Committee positions.
It is clear from the Rules that the plaintiffs are deprived of the ability to participate in AGMs, from a sense of community and togetherness obtained by membership, and from the alibility to stand for election to certain, limited Committee positions.
Declarations
The plaintiffs seek a declaration. A declaration 'conclusively establishes the situation it declares to exist between the parties': Parramatta CC v Sandell [1973] 1 NSWLR 151 (CA), 167 (Hutley JA). The foundation of the power to grant a declaration in this court is s 25(6) of the Supreme Court Act 1935 (WA). The jurisdiction to grant a declaration is very wide: Forster v Jododex Australia Pty Ltd (1972) 127 CLR 421 (Forster), 435 (Gibbs J; McTiernan, Stephen & Mason JJ concurring).
This broad discretion is guided by a general approach that declaratory relief may be granted where:
(1)the court's jurisdiction has not been ousted by statute (either expressly or by necessary implication);
(2)the plaintiff has standing to seek the declaration;
(3)there is a contradictor to oppose the declaration; and
(4)there is no other discretionary ground for refusing the declaration.
It is the second feature that is primarily in issue in this case. The plaintiffs must establish that they have a real interest to raise the subject of this dispute: Forster (437) (Gibbs J) citing Russian Commercial and Industrial Bank v British Bank for Foreign Trade Ltd [1921] 2 AC 438, 448 (Lord Dunedin). A determination of this issue is guided by a number of cases which consider the standing requirements to intervene in the affairs of voluntary associations.
Standing
Standing and justiciability
In this context, as in many others, questions of standing and justiciability are inextricably related. Whether a litigant fails to establish standing, or argues an issue that is non-justiciable, the outcome is the same: access to the Court is excluded. In Shergrill v Khaira [2014] UKSC 33; [2015] AC 359 (Shergrill), their Honours defined non-justiciability as referring to a case where, by reason only of its subject matter, an issue is inherently unsuitable for judicial determination: [41]. Their Honours subjected non-justiciable subject matters to a dichotomy: first, where the subject matter is beyond the court's constitutional competence; and second, claims or defences which are neither based on private legal rights or obligations nor on reviewable matters of public law: [41] - [43].
In this case, consideration of standing is an anterior question to the consideration of justiciability. In this case, if plaintiffs are successful in establishing standing (by proving that they have an interest entitling them to invoke this court's jurisdiction), it seems to me that they will be successful in establishing that a dispute is justiciable (by proving that their claim is based on a private legal right or obligation or a reviewable matter of public law), subject to there being no constitutional element that would put the dispute beyond this court's competence. Such an approach is consistent with the authorities, where, after considering the question of standing, the status of a controversy as non‑justiciable has been treated as a factor going to the decision-maker's discretion, albeit by requiring the court to refuse to exercise discretion to grant a declaration: Egan v Willis (1998) 195 CLR 424, (Egan) 438 - 439 (Gaudron, Gummow & Hayne JJ) citing Croome v Tasmania (1997) 191 CLR 119, 132 ‑ 133; Mutasa v Attorney-General [1980] QB 114, 123; [1979] 3 All ER 257 (Mutasa); Johnco Nominees Pty Ltd v Albury-Wodonga (NSW) Corporation [1977] 1 CSWLR 43, (Johnco) 59 (Street CJ).
The plaintiffs' case on standing
The plaintiffs' argument that they have standing to seek a declaration was put on two bases:
(a)The plaintiffs have a contractual interest: the Rules constituted an offer that the plaintiffs accepted by submitting an application form and paying the prescribed fee.
(b)The plaintiffs have a 'legitimate expectation' that decisions (the assessment of membership applications) will be made in accordance with the Rules.
The first plaintiff makes a further argument that she has standing on the basis of a breach by the defendant of the rules of natural justice. This argument will be considered separately and subsequently to the above arguments that are made in respect of all of the plaintiffs.
Was there a contractual relationship between the parties?
The essence of the plaintiffs' argument is that there is no express ground or general discretion to refuse membership, and that as a result, the plaintiffs' offers of membership had to be accepted subject to the plaintiffs not being rejected on the basis of r 7.3 because they 'had [a] history or [were] likely to [create] problems to the [defendant] in obtaining its objects'. In this way, the plaintiffs characterise the Rules as an offer. The defendant rejects any assertion that a contractual relationship is formed before the point that an application is accepted, arguing that the Rules give the defendant an implicit power to reject membership applications. Counsel for the defendant had some difficulty in articulating this construction argument specifically with reference to the rules, but argued that there is a discretion on the basis of:
(a)rule 11.1 (that the power to manage the defendant's affairs includes a power to accept or reject members); and / or
(b)rule 7.3 (that the wording of this rule is broad enough that 'the objects of the [defendant] come into play and the Committee can consider how those objects are affected'); and/or
(c)the Rules as a whole.
The evidence relied on by the defendant in support of its assertion that the admission of the plaintiffs as members would have been contrary to the interests of the defendant is primarily that:
(a)the defendant would be at risk of breaching s 178 of the Health Act 1911 (WA) at future AGMs if it continues to admit members because its membership numbers are swiftly approaching the maximum accommodation limit of the Bennett Springs Gurdwara;
(b)each of the plaintiffs do not attend the defendant's Bennett Springs Gurdwara regularly; and that
(c)the application of the first plaintiff was received at the same time as many other applications, all of whom are said by members of the defendant's Committee to be unknown to them.
In support of its argument the plaintiffs cited Lawton v Bidgerdii Aboriginal & Torres Strait Islanders Corp Community Health Service Central Queensland Region [2004] FCA 1474 (Lawton), where Kiefel J held that the respondent's rules did not contain a discretion to reject a person's application and that the respondent's rules constituted an offer of membership to persons who qualified as member under the rules that could be accepted by completing a membership application form: [21]. In addition, counsel for the plaintiff cited Woodford v Smith [1970] 1 WLR 806 (Woodford), a case that concerned membership of a ratepayers association. The rules of the ratepayer's association provided that '[a]ny person who agrees with the objects of the association shall be eligible for membership' for an annual subscription fee (and an application). There, Megarry J held that the rules did not give the Committee a power to reject or suspend the application for membership unless that application was not in accordance with the rules: (813 - 814).
These decisions are of little assistance in the present case. An assessment of the state of contractual relations between the plaintiffs and the defendant turns upon the proper construction to be given to the Rules, not that given to different rules in a different case.
The rules of an incorporated association such as the defendant are to be construed with a recognition, first, that these rules have an inherent public dimension; and second, that their being drafted by lay-persons justifies a more flexible interpretive approach: Echunga Football Club Inc v Hills Football League Inc [2014] SASC 201 [18] (Stanley J).
The Rules bear a feature that leads to the conclusion that they do not function as an offer open to acceptance by only an application by a suitably qualified applicant. This feature is the existence in r 7.3 of an express right to deny membership to an applicant who is assessed as having a history or a likelihood of creating problems for the defendant in attaining its objects. The existence of an express power on the part of the Committee to deny membership to an applicant is a substantial obstacle to any assertion that membership is automatic upon application. A corollary of this conclusion is that the plaintiffs' applications did not constitute an acceptance of any offer. Though the plaintiffs may have some interest, it is not at the level of a contract. Whether any subordinate interest is sufficient to give the plaintiffs standing to seek a declaration is the basis of the plaintiffs' second argument.
Was there a 'legitimate expectation' of an assessment in accordance with the Rules?
In the plaintiffs' written submissions they argue that as non-members they have a 'legitimate expectation' that their applications will be considered according to the Rules, and that this interest is sufficient to ground standing. I will first consider whether the interest articulated by the plaintiffs is sufficient to ground standing. Counsel for the plaintiffs referred to a number of cases to support this proposition, though primarily to McClelland v Burning Palms Surf Life Saving Club (2002) 191 ALR 759 (McClelland) and the cases cited by Campbell J therein. I will consider those cases, then cases cited by the parties that were not referred to by Campbell J, before continuing to consider cases not cited either by Campbell J or the parties. Subsequently, I will consider how each of these cases relates to the present case.
Standing in the context of voluntary associations
That a current (or former) member of an association, whether that association be incorporated or unincorporated, may have standing to sue for a denial of natural justice, or a breach of the rules of the association that affects a right or interest of that person is a relatively uncontroversial proposition, but one that nonetheless depends on the nature of the interest and the construction to be given to the rules of that association.
A comparatively more contentious proposition is whether and in what circumstances a non-member may have standing to obtain a declaration that the decision of a voluntary association has been made contrary to the rules of that association. It is this second type of situation that we are presently concerned with.
Campbell J's comment
The plaintiffs relied upon the comments of Campbell J in McClelland at [113] that (emphasis added):
… it is difficult to see how someone who is in practice affected by a decision of a private body of which he is not a member, or otherwise in any contractual relationship, could have any legitimate expectation other than that the body would act in accordance with its own rules, properly construed, in reaching that decision. A member of the private body has an expectation, and a right, that the body will make decisions in accordance with its rules: it is hard to see how the expectation of a non-member could be that the body will observe any different standard. If a decision is arrived at by a private body which, contrary to its own rules, does not accord procedural fairness to a non-member who is affected, it is in theory possible that there may be circumstances where the courts will recognise such a person as having standing to apply for a declaration of the invalidity of the decision, and an injunction against treating it as valid. It would be for the courts to develop, on a case-by-case basis, the circumstances in which such standing should be recognised. Even though the legal basis of the body's right to make a decision is contained in the constitutive documents of the body itself, there is no necessary reason why it should be only members of the body, or people with the benefit of a contractual promise that the body will follow its own required procedures, who can assert the invalidity of the decision. It is a fact of life that a decision of a private tribunal can affect people who are not members, or people who are not bound by contract to observe the decision- and the existence of the private body and of the decisions of its tribunal is a reality which affects people other than by force of a contract with the body. If the body has practical power to affect a plaintiff in a sufficiently serious way, it would be for the courts to recognise in which situations the nature of affectation of the interests of the plaintiff is sufficient to confer standing.
There are a number of material points which detract from the support that this proposition may lend to the plaintiffs' case.
First, this comment is obiter. Immediately beforehand, at [110], Campbell J commenced his analysis of the standing of non-members with a heading identifying it as a 'digression', after already having acknowledged that the plaintiff had standing on the basis of the provisions of the Associations Incorporation Act 1984 (Qld), which provided that the rules of an incorporated association take effect as a contract between the association and its members (which the plaintiff in that case was). Second, Campbell J only expressed a view that there 'may' be circumstances in which a non-member will have standing. Third, Campbell J's comment references a requirement that a plaintiff be affected in a 'sufficiently serious way'. The plaintiffs have not established that, in light of the prejudice outlined above, that the effect on their interests is at all serious.
Authorities referred to by plaintiffs
Cases referred to within Campbell J's judgment
Counsel for the plaintiffs referred to a number of cases, the majority of which are discussed in Campbell J's judgment in McClelland.
The first case referred to by Campbell J in his Honour's digression about non-members and natural justice in private bodies was Forbes v New South Wales Trotting Club Ltd (1979) 143 CLR 242 (Forbes). In Forbes, the defendant Trotting Club was a corporation with de-facto control of trotting in New South Wales, but no statutory powers (250) (Barwick CJ). The plaintiff was not a member of the defendant. A 'warning off' given by the defendant to the plaintiff was held to be invalid by a 4-1 majority of the High Court. Although the applicability of the rules of natural justice was conceded by counsel, (264) Gibbs J considered that this concession was 'correctly made' because even though the Trotting Club did not have statutory powers, it did control a public activity in which 'quite large numbers of people take part', meaning that:
[m]embers of the public have the legitimate expectation that they will be given permission to go on to courses when trotting meetings are being held provided that they pay the stipulated charge and provided of course that they are not drunk, disorderly or otherwise unfitted by their condition or behaviour to be admitted (264).
The second case referred to by Campbell J is Harrison v Hearn [1972] 1 NSWLR 428 (Harrison), in which an undergraduate Macquarie University student, who had paid all fees entitling him to enrolment at the university during 1972 (including the fee to the students' council) was held to have standing to seek a declaration and an injunction to restrain a proposed expenditure of money by the students' council, notwithstanding that he was not a member of the council and had no proprietary right in the property of the council nor any contract with the council. Helsham J held that:
(1)the council, an elected body governed by a constitution, was an unincorporated association (435);
(2)the funds from which the expenditure was proposed were analogous to trust funds because the source of the funds was the students of the university, and because the council represented the students and was charged with the promotion of their welfare (434 - 435); and
(3)the plaintiff had standing, as a student for whom those funds were effectively on trust, to seek a declaration and injunction in relation to the two impugned resolutions.
The third case is McInnes v Onslaw-Fane [1978] 1 WLR 1520; [1978] 3 All ER 211 (McInnes). The plaintiff had at various times held different types of boxing licenses. The defendants were members of an unincorporated body with de-facto control of boxing in the United Kingdom. All of the plaintiff's licenses were withdrawn by the defendant in 1973 because of his conduct as a master of ceremonies at a boxing tournament. Between 1972 and 1975 the plaintiff made five unsuccessful applications for a boxers' manager's license. In 1976, when the plaintiff again applied for that license, he sought a declaration that the defendant had acted in breach of natural justice and or unfairly in dealing with his application. Megarry VC held that, consistent with the defendant's concession, the court was entitled to intervene to enforce the appropriate requirements of natural justice and fairness owed to the plaintiff, noting that the defendant had an ability to affect the plaintiff's right to work (218).
The fourth case Campbell J referred to is Stininato v Auckland Boxing Association (Inc) [1978] 1 NZLR 1 (Stininato). The appellant in that case held a license as a professional boxer. Following a number of complaints, the defendant, a body with de facto control of boxing in New Zealand allowed the plaintiff's license to expire. Later, when the plaintiff applied, his application was refused. Noting; first, the significance of the public policy concerning restraint of trade, and instances where the courts have recognised the standing of footballers and horse trainers to challenge the decisions of bodies of which they were not a member; and second, the 'monopolistic control' exercised by the defendant, Richmond P held that the plaintiff had standing (and that the matter was justiciable) even though he was not a member and not in any contractual relationship with the defendant (7 ‑ 8).
The fifth case referred to by Campbell J is Blackler v New Zealand Rugby Football League (Inc) [1968] NZLR 547 (Blackler). The plaintiff was not a member of the defendant League. However, the effect of one of the League's rules prevented him from playing rugby league in Australia unless he obtained a clearance from the League in New Zealand. The plaintiff applied to the League for a clearance but was refused. The Court of Appeal (North P and McCarthy J, Turner P dissenting) gave a declaration that the rule under which the League was acting amounted to an unreasonable restraint of trade that was therefore void. The defendant did not challenge the plaintiff's standing in that case, a position that was affirmed by North P's conclusion that because the plaintiff's interests were 'vitally affected' by the League's rule, he had standing (554).
Next, Campbell J referred to Finnigan v New Zealand Rugby Football Inc [1985] 2 NZLR 159 (Finnigan), a decision of the New Zealand Court of Appeal. The defendant had decided to accept an invitation by the South African Rugby Board for the New Zealand rugby team to tour South Africa. The plaintiffs, members of two local rugby clubs, who were not members of the national controlling body, sought a declaration that the decision was invalid and unlawful and an injunction preventing the defendant from implementing the decision. The plaintiffs were held to have standing on the basis of factors including (178 ‑ 180):
1.Although there was no direct contractual relationship between the plaintiff and the defendant, the plaintiffs were more than mere followers of the game or other members of the public; as local club members they were part of the structure of the whole organisation.
2.The question of whether the defendant had failed in its objects was a fundamental question and not one that can be dismissed as involving dispute about internal management.
3.The decision to send the national team to Apartheid South Africa had considerable potential to affect the image, standing and future of rugby as a national sport of New Zealand and to affect the New Zealand community as a whole and the relationship of that community of its local rugby clubs.
4.While technically a private and voluntary sporting association, in making this decision, the defendant held a position of major national importance.
5.Unless people like the plaintiffs were accorded standing then in reality no effective way of determining whether the defendant was acting within its power.
The final case referred to by Campbell J in his discussion is Typing Centre of New South Wales v Toose (Unreported, NSWSC, 15 December 1988) (Typing Centre). The plaintiff sought judicial review of the decision of the Advertising Standards Council (a body established by Charter in 1974). The plaintiff was not a member of the ASC and had no contractual relationship with it. On the basis that the ASC was exercising a public function in interpreting and moulding advertising codes, Mathews J held that the ASC's decision was susceptible to judicial review.
Cases referred to in argument
The parties referred to additional cases that were not raised in Campbell J's analysis.
The parties referred to a number of cases concerning the standing of existing members that offer little assistance.
The plaintiffs referred to Lawton. In that case, the respondent was a community health association incorporated under the Aboriginal Councils and Associations Act 1976 (Cth). Under the respondent's rules, membership was 'open to adult Aboriginal and Torres Strait Islander persons normally and permanently resident in: Rockhampton and the Central Queensland Region' and applicants who qualified for membership were required to make an application and pay the annual membership fee. The applicant and those who applied together with her were notified that their applications were not accepted and their membership fees were returned. The applicant submitted that the defendant's rules do not give it the power to reject applications if the person applying meets the description in the rules and pays the necessary fees. The respondent submitted that the preservation of the defendant's objects gave them a discretion to refuse applications. Kiefel J held that the respondent's rules gave no implied discretion to the respondent's committee to reject a person's application, such that the respondent's rules constituted an offer to all persons who qualify for membership [20]. Her Honour granted a declaration that the respondent's committee did not have power to reject applications where the applicants had met the eligibility requirements and paid the fee provided for in the rules.
Counsel for the plaintiff also cited Woodford, where, after construing the defendant's rules, Megarry J held that the defendant's committee did not have a power to reject or suspend the application for membership unless that application was not in accordance with the rules (813 - 814). Each of the two plaintiffs in that case, one an admitted member and the other having been refused membership, were held to have the same interest and to have standing (811).
After arguing that the cases referred to by Campbell J in McClelland are distinguishable from the present case, counsel for the defendant argued that the present case is analogous to Baker v Liberal Party of Australia (SA Division) (1997) 68 SASR 366 (Baker). There, the plaintiff had sought membership of the defendant but had her application declined. The defendant's State Executive had an explicit discretion under the applicable rules to reject applications without giving any reasons (369). Bollen J held that there was '[n]o relationship known to the law' established between the plaintiff and the defendant and that the plaintiff had no 'special interest' entitling her to any order from the court, as and that the defendant had acted in accordance with its rules (374).
The defendant referred to comments by the majority in Cameron v Hogan (1934) 51 CLR 358, 378 (Rich, Dixon, Evatt & McTiernan JJ) (Cameron) and by Brereton J in Islamic Council of South Australia v Australian Federation of Islamic Councils Inc [2009] NSWSC 211 (Islamic Council) at [31], for the principle that the Court does not as a matter of course intervene in the affairs of a voluntary associations like the defendant.
Authorities not referred to by the parties
In Rose v Boxing NSW [2007] NSWSC 20 (Rose), Brereton J considered, inter alia, whether the plaintiff, 'Australia's pre-eminent amateur boxing referee and judge' had standing to bring proceedings challenging the resolution of the executive committee of Boxing NSW Incorporated. Having found that the plaintiff had standing on the basis of a contractual relationship [54], Brereton J continued that even if he was mistaken in that finding, there were four reasons that, as a non‑member, the plaintiff would have standing; three of those reasons are relevant to the present case [60]:
(1)there is a plenary power to grant declaratory relief absent a statutory provision precluding it, and
(2)the Association is not a mere private social club, but performs important public functions, and
(3)the reputation and ability of Mr Rose to conduct his affairs and activities in the boxing field (albeit amateur and not professional) is at stake.
Carberry v Drice as Rep of Brisbane Junior Rugby Union (An unincorporated Body) [2011] QSC 016 (Carberry) concerned the applicant's application for various forms of relief against bans preventing him from being a Brisbane Junior Rugby Union coach and banning him from rugby grounds for life. The applicant was not a member of the unincorporated Brisbane Junior Rugby Union, or the second or third respondents, which were incorporated rugby bodies. After hearing a strike-out application, Margaret Wilson J held that the applicant's claims for declaratory and injunctive relief should proceed to trial because, although the applicant did not have a case for a breach of a contract or the infringement of a proprietary right, given that he held two paid and two unpaid positions as a junior rugby coach, there was the potential that his livelihood or reputation would be affected [35] - [37], [44].
Do these cases bear a relationship with the present dispute?
As acknowledged by Brereton J in Rose, many of the cases referred to by Campbell J in McClelland were ones involving a financial interest or a restraint of trade [58]. That is not an element shared by the present case. I will now comment on how each of the cases referred to above relate to the present case.
Unlike the plaintiff in Forbes, the defendant here does not control a public activity in which a large number of persons take part. Unlike the plaintiff in Harrison, there is no existing trust-like relationship between the plaintiffs and the defendant in this case. McInnes and Stininato are both distinguishable because the defendant here does not have de facto control of a public activity nor was it argued that the defendant has the ability to affect the plaintiffs' right to work. Unlike in Blackler there is no issue about restraint of trade. The defendant's decision here can be distinguished from that in Finnigan: the plaintiffs are not part of some broader structure constituted by the defendant; this dispute is about internal management (and not more fundamental matters) and does not have the same ability to affect public or national interests; and in the absence of the plaintiffs, there remain suitable persons (the existing members) with standing to query whether the defendant is acting within power. Unlike the defendant in Typing Centre, it was not argued that the defendant here is exercising a public function.
I now proceed to consider the additional authorities raised by the parties in argument: Lawton, Woodford and Baker.
First, counsel for the plaintiffs argued that the present case is analogous to Lawton. There are a number of difficulties with that proposition. First, contrary to the decision in Lawton, the Rules do not constitute an offer of membership to all persons who qualify for membership under r 7.1. Whereas in Lawton standing could be asserted on the basis of contractual rights, no equivalent rights exist in the present case. The plaintiffs in the present case are now seeking to establish the existence of a 'legitimate expectation'. Second, Kiefel J gave no overt consideration to questions of standing or justiciability. Third, in addition to any argument about the Community Health Service's rules constituting an offer, it appears from the limited factual information that membership of the Community Health Service entitled members to certain rights that were proprietary in nature, and further, that the Centre was providing a public service.
Second, the plaintiffs argued that the present case is analogous to Woodford. As discussed in relation to Lawton, the plaintiffs here have not made out an argument that the rules constitute an offer to be accepted by an eligible applicant, which was accepted, and therefore have not established that they are in a contractual relationship with the defendant.
I will return to the third case raised by the parties, Baker, after I consider the decisions in Rose and Carberry.
Unlike the defendant body in Rose, the defendant here does not perform a public function, nor do its decisions have a comparable ability to affect the reputation and affairs of the plaintiffs. Whereas the applicant in Carberry held two paid and two unpaid positions as a rugby coach that were jeopardised by the bans imposed on him, there is no comparable effect on the plaintiffs' livelihood or reputation here, nor does the defendant perform any public function.
Conclusion
Counsel for the defendant argues that this case is analogous to Baker; that is, that the plaintiffs have no interest giving rise to standing to object to the refusal of their membership.
It is apparent from the comparisons above, that where a court has intervened in the affairs of a voluntary association at the suit of a non-member, some or all of the following features have been present:
(a)a contractual relationship between the plaintiff and the defendant association;
(b)an effect on the plaintiff's proprietary rights;
(c)a detrimental effect on the livelihood or right to work of the plaintiff (whether or not coupled with an effect on the plaintiff's reputation);
(d)the defendant association is a statutory authority and/or controls a public activity in which a large number of participants participate and/or fulfils a public function;
(e)the dispute is not about internal matters but is instead about matters more fundamental to the defendant association; and
(f)in the absence of persons in the category of the plaintiff, there are no others with standing to query whether the defendant association is acting within power;
Whether or not there may be cases in which a non-member has standing, the present case is not one. Whether or not the plaintiffs have a legitimate expectation that their applications would be considered in accordance with the rules, that interest would not suffice to give them standing.
Was there a breach of the rules of natural justice?
Having rejected the argument of the plaintiffs that they have standing on the basis of a legitimate expectation, I proceed to consider the argument that the rules of natural justice have been contravened in relation to the first plaintiff (but not in relation to the second and third plaintiffs). The first plaintiff's argument is that each of the applications dealt with at the 16 August 2015 meeting were not dealt with in accordance with the Rules. Counsel for the plaintiff did not refer to specific actions of the Committee at that meeting, but I understand he was arguing that the Committee considered all of the applications collectively, and not individually, and that rejecting applications sent by post and where persons are unknown to the Association is not in accordance with the Rules. Whether or not there has been a breach of the rules of natural justice in this case, for the reasons given above, the first plaintiff does not have standing to seek a declaration that the defendant 'has acted in a manner that is unfair, biased and capricious'.
Overriding discretion
A declaration is a flexible and discretionary remedy. Previous decisions make it clear that the broad discretion accorded by this remedy is not to be fettered by laying down strict and absolute rules on how discretion is to be guided: Forster (437) (Gibbs J); Johnco (50 - 51) (Street CJ); cf Ainsworth v Criminal Justice Commission (1992) 175 CLR 564, 581 ‑ 582 (Mason CJ, Dawson, Toohey & Gaudron JJ). I find that, even if the plaintiffs had established standing to seek a declaration, that I would refuse their claim in the excise of my discretion. This is for three reasons.
The first of these reasons is applicable to each of the plaintiffs. The first and second plaintiffs accepted in cross-examination that they did not make attempts to resolve the concerns expressed by the defendant's Committee (whether or not those concerns were valid under the Rules) and did not discuss the decision with members of the Committee or make another application for membership. The third plaintiff testified that he sought an explanation from a Mr Pooni, but that he took no other action (there is record of a Mr Pooni in the defendant's member register, however that person is not a member of the defendant's Committee). Although encouraged to increase their participation, the plaintiffs' evidence was generally that they were discouraged by the rejection letters that they received and did not do so. Whereas the courts are already reluctant to intervene in the affairs of voluntary associations, they should be even more reluctant where persons have not sought to resolve their dispute before seeking the assistance of the courts.
Second, the delay in seeking a remedy on behalf of the second and third plaintiffs. There was a delay of over sixteen months between their being informed of their rejection and when the writ was issued in this matter.
The third reason relates to justiciability. I have found that the plaintiffs in this case do not have standing, because they have not established an interest entitling them to relief. I also find that the plaintiffs have not established that this dispute is justiciable, because they have failed to prove that their claim is based on a private legal right or obligation or a reviewable matter of public law. There is authority for the proposition that the non-justiciability of a matter is a factor going to the exercise of a court's discretion in granting a declaration, such that the non-justiciability of a dispute determines conclusively that discretion should not be exercised and the remedy refused: Egan (438 - 439) (Gaudron, Gummow & Hayne JJ); Thorpe v Commonwealth of Australia (No 3) [1997] HCA 21; (1997) 72 ALJR 767, 779 (Kirby J); Mutasa; Johnco (59) (Street CJ). On the basis that this dispute is non-justiciable I refuse the grant of a declaration.
Was the plaintiffs' case adequately pleaded?
The defendant argued that the plaintiffs' case was not adequately pleaded in a number of ways. First, in relation to the plaintiffs' first argument that the defendant's rules constitute an offer to be accepted by a qualifying member who pays the prescribed fee, the defendant argues that the plaintiff pleaded only that a completed application form needs to be assessed by the defendant, and that the plaintiff did not plead that the applicant automatically becomes a member subject to not enlivening the express ground for rejection in r 7.3. Second, the defendant argues that there is no plea that the plaintiffs have standing to enforce the Rules. Third, in relation to the plaintiffs' argument that there has been a breach of natural justice in respect of the first plaintiff, the defendant argues that a plea that '[i]n failing to assess the [p]laintiffs' applications in accordance with its Rules, the [d]efendant has acted in a manner that is unfair, biased and capricious', is an inadequate plea for the argument advanced at trial.
Having decided that the plaintiffs do not have standing to pursue their claim, it is not necessary to consider the defendant's argument that the plaintiffs' case was not adequately pleaded.
Conclusion
The plaintiffs' claim shall be dismissed.
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