Khmer Buddhist Temple Association Inc v Chhet (No 4) - [2024] VSC 572

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL COURT

COMMERCIAL LIST

S ECI 2021 00158

KHMER BUDDHIST TEMPLE ASSOCIATION INC (ABN 63 990 104 294) (and others according to the Schedule attached)	Plaintiffs
v
HOUT CHHET (and others according to the Schedule attached)	Defendants

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JUDGE:	GARDE J
WHERE HELD:	Melbourne
DATES OF HEARING:	23-25 July 2024
DATE OF JUDGMENT:	17 September 2024
CASE MAY BE CITED AS:	Khmer Buddhist Temple Association Inc & Ors v Chhet & Ors (No 4)
MEDIUM NEUTRAL CITATION:	[2024] VSC 572

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INCORPORATED ASSOCIATIONS – Conduct of membership audit and committee election – Which rules apply – Preparation of list of members eligible to vote – Whether an auditor is an expert – Discretion – Summons to set aside membership list audit dismissed.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiffs	Mr A Naidu of Acrolex Pty Ltd
For the First to Fifth Defendants	Mr J Sutton	SDR Law
For the Sixth Defendant	No appearance

HIS HONOUR:

Introduction

On 15 August 2023, a new committee was elected to the Khmer Buddhist Temple Association Inc (ABN 63 990 104 294) (‘association’) at a special general meeting at 99 Alexander Avenue, Thomastown (‘premises’) chaired by Ms Bettina Evert, special counsel (‘chairperson’) with the assistance of an interpreter following an audit of the membership of the association conducted by Mr Timothy Sowden of counsel, (‘auditor’).

The results of the election were:

(a) Mr Visal Mom, the second plaintiff, was the only nominee for the role of President and was elected unopposed;

(b) Mr Thay Choeung was the only nominee for the role of Vice President and was elected unopposed;

(c) Mr Serei Put, the third plaintiff, was the only nominee for the position of Secretary and was elected unopposed; and

(d) Ms Saran Saing was the only nominee for the position of Treasurer and was elected unopposed.

By summons filed 10 May 2023, the first to fifth defendants (‘defendants’)[1] seek various orders of the Court, including in substance that:
[1]The sixth defendant was excused from attendance at the case conference by order made on 6 December 2021, and has not subsequently participated in the proceeding.

(a) the Court declare that the auditor failed to complete the audit of members of the association as directed by the orders of Steffensen JR (now Steffensen AsJ) dated 24 March 2022 (‘March 2022 orders’);

(b) the list of members of the association provided by the auditor to the Court on or about 10 February 2023 be set aside;

(c) the appointment of the auditor be ended;

(d) a new independent person be appointed as auditor (‘new auditor’) to audit the association’s records to identify the names and addresses of the members of the association who are entitled to vote;

(e) the new auditor meet with the principal parties to discuss the audit process and any matters that the principal parties raise relating to the audit process;

(f) the new auditor prepare a draft list of association members who are…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2024] VSC 572
Decision Date: 17 September 2024

CaseChat Overview and Summary

In this case, the Khmer Buddhist Temple Association Inc brought proceedings against Chhet, challenging the conduct of a membership audit and committee election. The matter was heard in the Supreme Court of Victoria. The central dispute involved the interpretation and application of the association's rules in conducting a membership audit and the subsequent committee election. The association alleged irregularities in the audit process and sought to have the membership list and election results set aside.

The legal issues before the court were whether the auditor was required to be an expert, the correctness of the auditor's preparation of the list of members eligible to vote, and the appropriateness of the court's exercise of discretion to set aside the membership list audit. The association argued that the auditor, who was a member of the association, did not possess the requisite expertise to conduct the audit and that the auditor had incorrectly prepared the list of members eligible to vote. They further contended that the court should exercise its discretion to set aside the membership list audit due to the alleged irregularities.

The court found that the auditor was not required to be an expert and that the preparation of the list of members eligible to vote was within the auditor's discretion. The court held that the association had failed to demonstrate that the auditor had acted outside the scope of their authority or that the auditor's actions were unreasonable. The court also found that the association had not provided sufficient evidence to support their claim that the membership list audit should be set aside. As a result, the summons to set aside the membership list audit was dismissed.

In light of the court's findings, no further orders were made by the court. The association's application to set aside the membership list audit was dismissed, and the association was ordered to pay costs to the respondent.

Orders