Nelson v Oakbank Racing Club Inc - [2021] SADC 160

DISTRICT COURT OF SOUTH AUSTRALIA
(Civil)
NELSON v OAKBANK RACING CLUB INC
[2021] SADC 160
Decision of her Honour Judge Thomas
23 December 2021
ASSOCIATIONS AND CLUBS - INCORPORATED ASSOCIATIONS - MEMBERS
The applicant is a life member of an incorporated association established for objects including the carrying on of horse racing for the purposes of recreation and amusement of its members at the Oakbank racecourse and promoting the improvement of horse racing in South Australia. Without consulting or engaging with the broader club membership, the racing club’s Committee resolved to support the decision of the controlling body for horse racing in South Australia to cease programming jumps racing from 2022.
There was intense division between the membership and the horse racing industry over the issue. Two Committee members resigned, there was a sudden influx of membership applications and a members’ requisition for a special general meeting was served on the Committee proposing a vote of no confidence in the Committee and to resolve to communicate to the controlling body the members’ opposition to the decision to cease jumps racing. The Committee refused to convene the special general meeting on the basis the requisition was not made by sufficient members, calling into question the Committee’s practices for the election of members for the past decade in non-compliance with the club’s constitution and the validity of the appointment of the current Committee members.
In the context of these controversies, the applicant’s request of the Committee made through her solicitors for access to the books and records of the club relevant to her legitimate concerns about important affairs of the club was refused. The applicant seeks an order authorising the inspection and copying of 12 categories of books, relying on s 39D of the Associations Incorporation Act 1985 (SA) or by reason of her implied contractual rights as a member to access and inspect the club’s records.
Held: The evidence, objectively considered, demonstrates that the member is acting in good faith and the inspection of the club’s books is for proper purposes related to her rights as a member within the meaning of s 39D of the Associations Incorporation Act 1985 (SA). Accordingly, the applicant is entitled to an order authorising inspection and copying of the club’s books relevant to the club’s affairs in issue. The proper scope of the categories sought considered. Further consideration given to the applicant’s contractual rights of access to the club’s books in the circumstances of this case.
Associations Incorporation Act 1985 (SA) s 3, s 3A, s 39C, s 39D, s 51, referred to.
McKay v Australian Alpaca Association (1997) 69 SASR 218; Grogan v McKinnon [1973] 2 NSWLR 290; Chiropractic and Osteopathic College of SA Inc v Struthers 97 LSJS 49; Millar v Houghton Table Tennis & Sports Club Inc [2003] SASC 1, applied.

NELSON v OAKBANK RACING CLUB INC
[2021] SADC 160
Civil
INTRODUCTION
Nature of the Application

The Applicant is a Life Member[1] of the Oakbank Racing Club Incorporated (the Club), an association incorporated under the Associations Incorporation Act 1985 (SA) (the AI Act) and seeks an order authorising the inspection and copying of 12 categories of the Club’s books under s 39D of the AI Act. The Applicant also relies on a right to access the books and records required to be kept by the Club as an implied term of the contract between each member and the Club and the members inter se.
[1] As defined in Constitution comprising Exhibit A2. A “Life Member” is a person who has rendered valuable services to the Club and been elected as such at any annual general or special meeting of the Club on the recommendation of the “Committee” in accordance with clause 8. A Life Member is entitled to all the privileges of an Ordinary Member without payment of the annual subscription fee due on the first day of each financial year: clauses 8, 17 and 18.
The categories of books she seeks to inspect and copy are listed in revision 2 of her application.[2] I address the issues arising from the specific categories for which inspection is sought at the end of these reasons. First, I set out the facts leading to the application as ultimately pressed and opposed at the hearing before me and my consideration of the merits of the application generally.
[2] Originating Application - Revision 2 (FDN 12).
End to Jumps Racing in SA
The application is made against the background of the recent controversy surrounding the announcement on 1 October 2021 by the controlling body for horse racing in South Australia, Racing SA Limited (Racing SA), to cease programming jumps racing in South Australia from 2022 and the decision made by the Club’s Committee[3] to publicly support Racing SA’s decision and program a 2022 Oakbank Easter Carnival comprising flat racing only.
[3] The “Committee” is empowered “to manage the affairs and the general business of the Club” by clause 25 of the Constitution (Exhibit A2).
Club Membership Issues
There is intense division between the membership and the horse racing industry over the issue. The Committee’s expression of public support of Racing SA’s decision was made without consulting or engaging with the broader Club membership.
As a result, two Committee Members resigned. Contemporaneously, there has been a “sudden influx” of membership applications. A members’ requisition for a special general meeting of the Club was served on the Committee. The requisition set out as the objects of the meeting proposed resolutions to pass a vote of no confidence in the Committee, to resolve and communicate to Racing SA the members’ opposition to the cessation of jumps racing and to appoint a new Committee.
The Committee refused to convene a special general meeting on the basis that the requisition was not made by sufficient “Members”[4] because only seven of the signatories were Members, the others being pending applications for membership. This was despite the Committee’s 10-year practice of accepting membership applications without any election as required by the Constitution.
[4] “Member” is defined in clause 3 of the Constitution (Exhibit A2) to mean various categories of members (including for example an “Ordinary Member” and a “Life Member”) and those previously elected as corporate Members and excluding others. An “Ordinary Member” is defined as a natural person who has been elected as a Member of the Club and who is not an “Under 25 Member”, a “Limited Member” or an “Honorary Member”. Emphasis supplied.
The Committee’s conduct in these circumstances has called into question its practices over the last 10 years for the due election of Members[5] by comparison to its rejection of the recent influx of membership applications and, specifically, the validity of the appointment of the current Committee Members if any are not duly elected Members and therefore are ineligible for appointment to the Committee.
[5] But not Life Members.
Basis of Opposition
The Club by its Committee opposes the application.
The Committee has taken an adversarial approach to opposition to its position on jumps racing, on the basis that the Club has no control over Racing SA’s decision to remove jumps racing from the 2022 racing program. In the Committee’s view, the practical reality is that it is vitally important to maintain a positive working relationship with Racing SA. The Committee considers its antagonists wish to harm the Club and are seeking to promote a political agenda in favour of jumps racing that is hostile to the Club and its best interests as determined by the remaining Committee Members.
Ultimately and practically speaking, the Club’s opposition is directed at the scope and form of the order for inspection and copying, having regard to what its counsel described as the “central question” of the intended use by the Applicant of the books sought to be inspected and copied. The Club seeks to constrain the Applicant’s use of its books by characterising the Applicant’s purposes for inspection as ultimately improper ones within the meaning of s 39D of the AI Act:[6]
…the issue is the excess in the way in which she pitches her categories…and the excess in [the] wanting to be able to use it in ways that are going to harm the Club…
[6] T116.35-.38.
In this way the Club opposes the application despite its (properly made) concession that the Applicant as a member holds genuine and legitimate concerns about important affairs of the Club in all the circumstances. It was submitted by the Club’s counsel that at the heart of its opposition is the Committee’s concern to ensure its confidential information does not get out to those with adverse interests, and this controversy does not get played out in the media, bearing in mind that a member’s right to inspection of the Club’s books does not confer a right to a broad-ranging inspection of all the Club’s books in the nature of discovery or permit intrusion into the management of the Club.
The Club further submits that various of the categories of books sought to be inspected and copied are too widely cast and unnecessary having regard to the relevant affairs of the Club in issue and any proper purpose for inspection necessarily constraining the exercise of the Court’s discretion in authorising inspection and copying of the Club’s books in this case.
The Evidence
The parties read and relied on affidavits of evidence-in-chief of the following witnesses:
·the Applicant, Ms Frances Nelson QC, a Life Member of the Club, whose extensive involvement with the Club and racing industry is set out below in more detail
·Mr John Adrian Glatz OAM, also a Life Member of the Club, who served on the Committee from 1986 until April 2021, including as Chair for 25 years
·Ms Arabella Branson, current Chair of the Committee
·Mr Matthew Selley, the Club’s solicitor, whose affidavit exhibited correspondence between the parties’ solicitors
The Applicant and Ms Branson were cross-examined.
I found the Applicant an impressive witness, who was frank about her grievances and the purposes of her application. I accept her as an honest witness who genuinely says she does not know what has occurred and until she does investigate matters by inspecting the Club’s books, she cannot be precise about what, if any, further action she might take. I also accept that the Applicant understands the reasonable need for the confidentiality of personal and sensitive commercial information to be protected and is prepared to abide by any order of this Court to control the use of any information disclosed to her, consistent with any legitimate concerns of the Club in this regard.
Overall, I found Ms Branson’s evidence defensive and reflected her obvious discomfort about the public and unfortunate way in which this controversy has unfolded. I accept she believes she is acting in the Club’s best interests and it is evident that her entrenched view that “it’s simply not possible” to seek to advocate for a possible reversal of Racing SA’s decision on jumps racing[7] informs her judgment on membership matters and concerns about the Applicant’s ultimate purposes in pressing her application as she perceives them.
[7] T79.26-.27.
In cross-examination, Ms Branson was at times less than direct about important matters, including the timing and detail of her discussions with Racing SA about the decision to cease jumps racing and the Committee’s deliberations on the matter. Her evidence was surprisingly vague given the significance of these matters and their recency. In my view, her evidence is an important contextual fact and fuels scepticism and suspicion about what has actually happened regarding a matter of significant importance to the members of the Club. Ms Branson’s evidence about the alleged burden and practical difficulties in the Club providing access to its books was particularly unsatisfactory and I found her evidence as to the oppressive nature of the requests for inspection overstated. I comment further on this aspect of her evidence in addressing the specific categories of documents sought below.
Conclusion
As a matter of principle, subject to the provisions of the Constitution, the Applicant is entitled as a member of the Club to participate in the management of the Club and its affairs delegated to the Committee and not to be unfairly excluded from participating. She has an interest in the longer-term aspects of its affairs (such as the cessation of programming jumps racing) and in ensuring that the Club conducts its operations in accordance with its Constitution and, in particular, who is properly a Member and whether the present Committee Members are validly elected.
As I have said, the Club concedes the Applicant as a member holds genuine and legitimate concerns about important affairs of the Club and properly does so in all the circumstances. Specifically, the Club accepts that the Committee’s decision to publicly support Racing SA’s decision was very significant given the Club’s 147-year history of jumps racing,[8] the membership issues are real[9] and the Applicant as a member has a right to understand what has transpired for proper purposes, such as vindicating her rights and entitlements as a member by suing the Club. The Club does not suggest the Applicant has any form of collateral interest.
[8] T82.26-.32.
[9] T110.24-.27.
From the Applicant’s evidence and the relevant events set out below I find that her purposes in seeking inspection of the Club’s books (as are relevant) are twofold.
·First, to understand the Committee’s position and involvement in Racing SA’s decision to cease programming jumps racing in South Australia from 2022 and why the membership was not consulted on a matter of such general importance.
·Secondly, to understand the Committee’s disregard of its obligations under the Constitution regarding the election of Members for the last 10 years that has significant implications for the legitimacy of the present Committee Members’ claims to hold office and its subsequent refusal of the influx of new membership applications and refusal to convene a special general meeting.
I accept the Applicant’s evidence that her purposes for inspection are a first step to investigate relevant events to gain an understanding of what went on and she cannot formulate a second step until she has the information from an inspection of the Club’s books.
The Club characterises the Applicant’s purposes as improper within the meaning of s 39D of the AI Act because it submits, ultimately, her agenda is to reinstate jumps racing, which in the Committee’s view is not possible and against the best interests of the Club. Further, it is suggested that she wants to promote her jumps racing agenda by making public the Club’s confidential and sensitive records and engage in a media war with supporters of jumps racing who are hostile to the Club’s best interests and not members.
In my view, this is not a fair characterisation of the Applicant’s evidence and inconsistent with the Applicant’s early and appropriate concession by her solicitors, as reiterated in her oral evidence, that she does not have any objection to a reasonable and appropriately tailored confidentiality regime that does not impinge on the use of those materials for the purposes of taking subsequent legal action, if so advised. The Applicant was plain in cross-examination that she did not say she would share the documents with other people, rather she was prepared to share her understanding of what had gone on (and not the documents per se). In her view, the operations of the Club should not be secret from its Members and she would of course abide by any confidentiality orders of this Court.
Furthermore, objectively considered, there is no evidence to conclude that the Committee’s view is the only position to take in promoting the best interests of the Club in accordance with the objects for which it is established or that use of information from the Club’s books will harm the Club.
For the reasons that follow, in the extraordinary circumstances where the Committee has not consulted with and deliberately refrained from engaging with its members over issues of significant importance to members, I am entirely satisfied that the Applicant is acting in good faith and the inspection and copying of the Club’s books I will authorise (as set out at the end of these reasons) is for a proper purpose within the meaning of s 39D of the AI Act.
I will hear the parties as to the form of the further orders I propose to make to protect any reasonable claim for confidentiality of the Club’s affairs, having regard to matters that are already in the public domain. I will also hear the parties as to costs.
CONSIDERATION
Legal Principles
It is uncontroversial that the constitutional rules of the Club represent a contract between it, the Applicant as a member and the members inter se.[10]
[10] Chiropractic and Osteopathic College of SA Inc v Struthers 97 LSJS 49 at 50-51 per King CJ and at 63 per Mitchell J.
Further, the rights and interests of a member of an incorporated association are to be distinguished from those of a member of a company incorporated under the Corporations Act 2001 (Cth) (Corporations Act). The AI Act expressly excludes the operation of the Corporations Act[11] and there is a fundamental difference between the nature of a company and an incorporated association. Broadly speaking, a company is established for commercial objects whereas an incorporated association involves its members joining together for a specific social, cultural or like purpose, without necessarily any financial or commercial interest.
[11] s 3A of the AI Act.
Subject to the terms of the constitution, a member of an incorporated association has an interest in sharing in its facilities and activities and the longer-term aspects of its operations, and is entitled to participate in its management and other decision-making bodies. This means a member has an interest in ensuring the incorporated association carries on its operations in accordance with its constitution (including its constitutional objects and the powers) and in not being unfairly excluded therefrom.[12]
[12] Millar v Houghton Table Tennis & Sports Club Inc [2003] SASC 1 at [136] per Besanko J.
An incorporated association must keep accounting records to correctly record and explain the transactions of the association and its financial position[13] and it must keep minutes of all proceedings of general and committee meetings.[14] A member’s rights as to inspection of the records of an incorporated association are provided for in s 39D of the AI Act as follows.
[13] s 39C AI Act.
[14] s 51 AI Act.
39D—Inspection of records
(1)A member of an incorporated association may apply to the District Court for an order authorising an inspection of the association's books on behalf of the member by a person authorised under this Act to audit the accounts of a prescribed association or a legal practitioner.
(2)If the Court is satisfied that—
(a) the member is acting in good faith; and
(b) the inspection is for a proper purpose,
the Court may make an order authorising a person authorised under this Act to audit the accounts of a prescribed association or a legal practitioner, at a time specified in the order, to inspect and make copies of or take extracts from the association's books.
(3)The Court may, on an application under this section, make such further or other orders as it thinks fit, including an order for costs.

‘Books’ are defined in s 3 as including:
any register or other record of information and any accounts or accounting records, however compiled, recorded or stored, and also includes any document
The rights of a member under s 39D of the AI Act are conditioned on this Court being objectively satisfied on the composite criteria that the member is acting in good faith and the inspection is for a proper purpose.
There is consensus between the parties to this extent. The Applicant contends that her statutory rights under s 39D of the AI Act extend her implied contractual rights as a member to access and inspect the Club’s records. The Respondent disputes that any such contractual right arises in this case, where its facts are distinguishable from McKay v Australian Alpaca Association[15] and Grogan v McKinnon[16] by reason of different constitutional rules.[17]
[15] (1997) 69 SASR 218, 225-226 and 228.
[16] [1973] 2 NSWLR 290.
[17] [1973] 2 NSWLR 290.
It is not strictly necessary for me to determine this point of principle because, ultimately, I have found that the Applicant’s statutory right under s 39D of the AI Act a sufficient basis upon which to authorise inspection of the Club’s books for the reasons that follow. Nonetheless, I accept as a matter of basic contractual principle, that where a contract provides for one party to keep records (ie the Club), absent any requirement of confidentiality imposed by the terms of the contract or other relevant limitation under the contract or at general law, the other parties to the contract (ie the Members) are entitled to access those records.[18]
[18] McKay op cit; Grogan v McKinnon ibid.
In this case, there is nothing in the Club’s Constitution that limits a member’s rights of access to the various records the Club is required to keep under the Constitution: that is, the register of members,[19] full accounts[20] and minutes of Committee and members’ meetings.[21] Taking account of the objects for which the Club is established, namely to carry on horse racing for the purposes of recreation and amusement of the Members and to provide for the social and sporting advantages for its Members, and that the Members have delegated to the Committee management and conduct of the Club on their behalf, it is implicit from reading the Club’s Constitution as a whole that the records required to be kept are to be kept for the Members’ benefit. The Club’s records would be of no benefit to Members if they were not made available to the Members for proper purposes.
[19] Clause 14.
[20] Clause 31.
[21] Clause 26.
A Member’s implied contractual right to access the Club’s records, like any other right or power, is not unconstrained. That right must be used for a proper purpose consistent with the grant of the right.
Finally, for completeness I mention that there was debate between the parties as to application of authorities considering s 247A of the Corporation Act and its predecessors. Such authorities are not directly relevant given the fundamentally different nature of companies and incorporated associations, but I accept they provide some guidance about matters affecting the exercise of the Court’s discretion regarding inspection of records. Ultimately, it is the circumstances of the specific case and context circumscribing the purpose for inspection by a member that must be considered.
Background
Jumps Racing at Oakbank Racecourse
The objects for which the Club is established are set out in clause 4 of its Constitution as follows.
(a)    To carry on horse-racing for the purposes of recreation and amusement of Members of the said Club at Oakbank in the State of South Australia or at such other place or places as may from time to time be decided upon by the Committee.
(b)    To provide social and sporting advantages for its Members and for persons interested in horse-racing and to promote the improvement of horse-racing in South Australia.
(c)    For the furtherance of the last mentioned object to encourage horse-racing by the promotion of horse races, and the giving of prizes, stakes and rewards therefore.
(d)    …
(e)    To delegate to the Members of a Committee (to be appointed as hereafter provided) the conduct and management of the Club and the affairs thereof.
(f)     …
It is notorious that the Club has a long history in conducting an Easter Racing Carnival largely comprising jumps racing and three internationally famous races: the Great Eastern Steeplechase, the von Doussa Steeplechase and the Harry D. Young Hurdle, widely reputed as traditionally the world’s largest picnic race meeting.[22] The Easter Racing Carnival is plainly important to the local community, historically, socially and economically.
[22] Exhibit MS2 to the Exhibit R12.
The Applicant has been a Member of the Club since 1986 and a member of the Committee between 1988 and 2007. Her contribution and the valuable services rendered by her to the Club have been recognised by her election as a Life Member pursuant to clause 8 of the Constitution. She has ridden and trained horses at Oakbank Racecourse for over 50 years. She is a licensed owner and was a licensed trainer for 22 years. She has significant longstanding associations with various other horse and racing bodies, including as Chair of Jumps Racing SA from 2001 to 2007 and, until 2021, as a member and Chair of Racing SA (and its predecessor body Thoroughbred Racing SA) as well as board positions with Racing Australia and the Asian Racing Federation. The strength of the Applicant’s interest and reputation and standing in horse racing generally is shown by her induction into the Racing Hall of Fame in 2021, which honour was acknowledged at the Club’s annual general meeting in September 2021.
It is accepted by the Club that she makes her application in her capacity as a Member of the Club and, as I have said, has a genuine and legitimate interest as a member in investigating the affairs of the Club in the circumstances surrounding the decision of Racing SA to cease programming jumps racing in SA from 2022. Given her longstanding involvement with the Club and horse racing industry, she as a member is genuinely and vitally interested in what the Club is doing and in her words:[23]
I am concerned about the viability and sustainability of a club to which I devoted a very large part of my life. That is my concern.
[23] T41.21-.23.
On 1 October 2021, Racing SA announced that jumps racing would not be scheduled in the South Australian racing calendar from 2022. Self-evidently, this decision has significant implications for the Club and its members. It means that the Easter carnival will comprise flat racing only. This was confirmed by Racing SA’s release on 8 October 2021 of a revised program for the Easter Racing Carnival at Oakbank Racecourse comprising no jumps racing. This announcement included a public endorsement of the revised program by the Chair of the Club, Ms Arabella Branson, as a “true Easter carnival” and “great news for the traditionalists as well as families.”[24]
[24] Exhibit A10 at page 15.
The Club’s annual general meeting was held on 16 September 2021, just over two weeks before Racing SA’s public announcement. The Applicant was present. Despite reports being delivered by both the Chair, Ms Branson, and the Chief Executive Officer, Mr Shane Collins, that looked forward to the 2022 season and the coming announcement of the program for the 2022 Easter Carnival, no mention was made about the removal of jumps racing or impending changes to the usual program for the Easter Carnival.
Ms Branson gave oral evidence that she had a specific telephone discussion with a staff member from Racing SA after the Club’s annual general meeting, some ten days before a Racing SA board meeting scheduled for 1 October 2021 and was told that the cessation of jumps racing in South Australia was on the agenda. Ms Branson convened a Committee Meeting in the following week to consider Racing SA’s impending decision on jumps racing. The Committee decided to support Racing SA’s decision if it made an announcement to cease jumps racing and attend the media conference to support that decision.
The Committee did not consult with the Club membership about the impending decision by Racing SA or its decision to publicly support Racing SA’s decision, despite the obvious importance of these matters to members.
In her written evidence, the Applicant expressed her deep concern over this sudden development changing the entire modus operandi of the Club without warning after a 147-year history of jumps racing at Oakbank. In her view, this decision risks significantly diminishing the Easter Carnival, which is largely reliant on jumps racing and draws attention across Australia and internationally, and, in turn, threatens the ongoing racing and commercial viability of the Easter Carnival and the Club.[25] Her greater concern, however, is that these significant changes were made without notice or consultation by the Committee with the broader membership.[26]
[25] Exhibit A10 at [9].
[26] Ibid at [10].
In the Applicant’s words:[27]
This [inspection] is a step to gain information so that people have an understanding of what happened, why it happened, who said what, what – I mean we are really in a situation where a decision has been made, there was no consultation with members, no-one has any understanding of what went on and there’s an obdurate committee that won’t even engage to explain why they made that decision.
[27] T40.20-.28.
And:[28]
The purpose of these proceedings is to get information so that I have an understanding of what happened, how it happened and why it happened and I wouldn’t be bringing the proceedings if the Committee had deigned to meet with members and explain themselves which they have steadfastly refused to do.
[28] T39.29-.34.
Based on her industry experience, the Applicant gave evidence that she finds it inconceivable that there was not a large amount of consultation between Racing SA and the Committee of the Club before the decision to stop jumps racing was made public. She said she does not know what position the members of the Committee have taken on the issue to stop jumps racing but considers it reasonably likely that the Committee instigated or promoted the decision of Racing SA. She expects whatever has happened will be recorded in correspondence between the Club and Racing SA and Committee meeting papers and minutes. By her application, she seeks authorisation to inspect and copy Club books on this topic.[29]
[29] See paragraphs 2.11 and 3 of her Application.
I am entirely satisfied of the propriety of the Applicant’s purpose in inspecting the Club’s books to understand the full circumstances of the Committee’s involvement in and deliberations regarding Racing SA’s decision to cease programming jumps racing from 2022. The propriety of her purpose is underscored by the Committee’s failure to consult with members over a matter of significance and the Committee’s resistance to engaging with members in any meaningful way to explain why its entrenched position is in the best interests of the members.
Membership Issues
On 19 October 2021, the Applicant signed a requisition to convene a special general meeting addressed to the Committee giving notice of the following matters to be considered at the meeting:
1.   To pass a vote of no confidence in the Committee;
2.   To resolve that the Members do not consent to a racing programme at Oakbank without the inclusion of jumps racing, and that such decision be communicated to Racing SA; and
3.   To resolve that immediate steps be taken to elect a new Committee.
More than 50[30] other persons signed the same requisition addressed to the Committee, purporting to be members of the Club. More than 50 of the signatories to the requisition had applied for membership following Racing SA’s announcement to cease jumps racing in South Australia.
[30] Exhibit A1 comprising a bundle of members’ requisitions for a special general meeting.
The Committee did not convene a special general meeting. Instead, following an opinion from Queen’s Counsel,[31] it took the approach that the requisition was not valid because the Constitution by clause 37 required not fewer than fifty (50) Members to validly requisition a special general meeting, and according to Ms Branson’s review of the membership records as of 3 November 2021, only seven were current Members. This was so despite the Committee being expressly empowered to convene such a meeting “whenever they think fit” and their express power to “[r]efer questions of general importance to the Members in General Meeting assembled.”[32]
[31] Exhibit R14.
[32] Clause 25 VIII.
On 3 November 2021, the Chair, Ms Branson, sent one of the requisitioners, Ms Penny Keen (who is also the Secretary of Jumps Racing SA), an email stating that she had reviewed the “current membership or new membership application lists” and “noted” that only seven of the signatories were current members of the Club, two had applied to be removed, five did not appear at all and the balance were recent applicants for membership.[33] The email ended with “…the Club will be sending out correspondence to all applicants for membership shortly once we have had a chance to ensure that correct processes are followed.”
[33] Exhibit A3.
The written evidence of Mr Glatz, a Life Member and former Chair and Committee Member, was that for at least 10 years, the Committee has not followed the requirements provided for in the Constitution for the election of new Members by a vote at a Committee Meeting.[34] After dispensing with the previous requirement for a nominee to be proposed and seconded by an existing Member and ratified by the Committee and any re-joining fee, the process for becoming a Member for at least the last 10 years has simply involved the completion of the application form (online) and payment of the annual subscription fee, after which membership and guest passes for race meetings for that financial year are issued to the member.
[34] Clause 9 provides: Any person desiring to become a Member shall apply in writing to the Secretary, furnish his name and address, and forward with his application the necessary subscription fee, which shall be repaid to him in the event of his not being elected. The power of electing Members (other than Life Members) shall vest in the Committee, and all elections shall be by vote to be conducted in such manner as the Chairperson presiding at any Committee Meeting at which any election for Members is to take place shall direct.
Ms Branson confirmed in her oral evidence that since she had joined the Committee in late 2017, she had never been present at any Committee meeting where applications for membership were considered or any election or vote occurred. She explained that the Committee had informally delegated the responsibility of electing members to management for practical reasons. In her view, it would not be reasonable for the Committee to comply with clause 9 of the Constitution and consider individual applications for membership and vote on them given the number of applications and the time they are usually received.
Whilst it is apparent that the Applicant was aware of the Committee’s disregard for the constitutional requirements for the election of members from Mr Glatz in November 2021, she does not know the detail of this practice and whose membership status is affected, bearing in mind that the Constitutional provisions for the admission of membership distinguishes between new members and recurrent members who are required to pay their annual subscription fee before being issued member and guest passes for race meetings.
There was then an exchange of solicitors’ letters[35] between the parties about the Applicant’s concerns about how the Committee had dealt with the requisition notice and its determination that the greater majority of the requisition signatories were not elected members in circumstances of the Committee’s membership practices for the last 10 years and it not returning the subscription fee paid by any of these applicants.
[35] Exhibit R12 – 5 Nov, Griffins Lawyers to Club; 10 Nov, Iles Selley to Griffins Lawyers;15 Nov, Griffins Lawyers to Iles Selley; 16 Nov, Iles Selley to Griffins lawyers
By her solicitors’ letter dated 15 November 2021, the Applicant made a request under ss 39D and 51(6) of the AI Act for inspection of 12 categories of the Club’s books and records within seven days, so that she “may properly consider her position in respect of the Club and the position now taken by the Committee”.[36]
[36] Exhibit R12 Tab MS5 page 23.
This letter confirmed the Applicant’s instructions to make urgent application to the court if arrangements were not made for inspection as requested.
On 15 November 2011, the Applicant also filed her originating application seeking inspection of the books of the Club under s 39D of the AI Act on the basis of the supporting affidavit of her solicitor Mr Greg Griffin.[37]
[37] FDN 1 which was superseded by FDN 5 – Originating Application – Revision 1. His affidavit was not in evidence before me.
The Club’s solicitors responded by letter dated 16 November 2021,[38] objecting to the request as framed in the application as oppressive and unsupported by any properly articulated purpose for which inspection is sought under s 39D of the AI Act. The letter concluded by expressing concerns about the confidentiality of the material for which inspection was sought and the attendant publicity to the proceedings, claiming the media knew about the proceedings before the Committee did.
[38] Exhibit A6.
The Applicant’s solicitors responded by letter dated 18 November 2021,[39] clarifying the ambit of the request and her purposes in seeking inspection of the Club’s books. As to the Club’s concerns for confidentiality, the letter communicated the Applicant’s instructions that she did not object to a reasonable and appropriately tailored confidentiality regime, provided it did not impinge on her using those materials in subsequent proceedings, if so advised. The letter concluded by asking whether the Club would grant the Applicant access to inspect and copy the requested books. The Club did not.
[39] Exhibit A7.
On 25 November 2021, the Committee met to determine pending applications for membership.
According to Ms Branson’s oral evidence, the Club presently has only 68 members for the current financial year. In previous years membership has varied between 200 and 250 members. In 2015, there were 1500 members. Ordinarily, the vast majority of applications are received in the two to three weeks, even days before or during the Easter Carnival.[40] In Ms Branson’s words, by the time of this Committee meeting, the Club had received a “sudden influx” of some 250 to 300 applications for membership since early October 2021 when the controversy over jumps racing first erupted.[41] She considered the applications unusual, noted many were from people from Victoria (the only State currently holding jumps racing) and not explained by the twilight carnival to be held on 22 December 2021.
[40] T63.30-.33.
[41] T66.28-.29.
As it transpires, according to Ms Branson’s oral evidence, there was no election by vote conducted by her as the Chair presiding at the meeting as required by clause 9 of the Constitution. In fact, none of the applications for membership were put before the Committee when it met to determine them. Instead, the Committee resolved to establish the following filters for management to screen the “sudden influx” of applications and reject any application made by a person who had:
·signed the requisition for the special general meeting or
·contributed to the “Go Fund Me” fund to raise moneys for the purpose of restoring jumps racing
on the basis that this would screen out any applicant advocating for the return of jumps racing and, in the Committee’s view, was therefore not seeking membership for a proper purpose. It was further resolved that for all applicants not rejected in this way, a letter would be sent to them seeking more information as to the basis on which they sought membership. Further consideration of those applications was deferred to the Committee’s December meeting.

Formal minutes of the Committee’s 25 November 2021 meeting had not been prepared by the time of the hearing. Ms Branson exhibited to her written evidence the text of resolutions passed at this meeting. It is not necessary to set out the whole of the text, other than to observe that it plainly seeks to justify the Committee’s resolution to reject any applicant who signed the “petition” for a special general meeting or contributed to the “Go Fund Me” fund to raise moneys for the purpose of restoring jumps racing on the basis that either of those circumstances gives rise to a reasonable prospect that the applicant is not seeking membership for a proper purpose.
It is not clear on the evidence before me how many of the pending applications were rejected and how many were deferred for further consideration, but it is apparent that none of the pending applications for membership were accepted as Members at the Committee meeting held on 25 November 2021.
The Applicant gave evidence of persons she knew or believed to be members of the Club from her involvement in the Club and attending race meetings over the last 30 years. As a Committee Member, she is aware that the Committee in admitting new members never “knocked back” any membership application. She has since been refused access to the Membership Register in circumstances where there are significant implications arising as to who is a duly elected Member or not, including the present Committee Members.
At the hearing before me, the Club sought to constrain the Applicant’s rights of inspection by its characterisation of her ultimate purposes as being improper, despite accepting the propriety of her immediate purposes. The Club’s counsel put to the Applicant a number of propositions in cross-examination to the effect that, ultimately, her agenda is to reinstate jumps racing and unwind the decision of Racing SA, that she is using her status as a member to represent jumps racing supporters concerned about Racing SA’s decision and intends to make public and share the Club’s highly confidential and sensitive documents with non-members who are hostile to the Club and its interests.
The Applicant frankly and sensibly responded to each proposition put to her by reiterating that whilst she considers Racing SA’s decision short-sighted and unwinding it is something she would like to happen, the purpose of her inspection is to understand, in her words: “what went on”. She explained that Racing SA had previously given a commitment that jumps racing would endure for at least three years to the 150^th year of running the Great Eastern Steeplechase and they have reneged without any consultation. In her words:[42]
…this is the greatest decision the Committee’s ever made and they will not engage with members to explain what they are doing, why they’re doing it, what their business plan is and indeed what their contingency plan is if it turns out not to work. So I have put 20 years of my life into that club. I have put 31 years in total into racing administration as a volunteer. I do not want to see an ill-considered decision made without consultation with the participants and that goes to the Committee too because only one of them lives in the local area, I think.
[42] T39.14-.24.
Importantly, the Applicant was clear in her oral evidence that the first purpose of her inspection and copying was investigating “what went on” and that was the only step she intended at this stage until she has sufficient information to formulate her next step, if any. She holds the strong view that the affairs of the Club should not be secret from its members and whilst she is prepared to share her understanding of what went on publicly, she did not say she would share the Club’s documents with other people. Further, I accept that the Applicant respects the confidentiality of personal information (such as Members’ addresses) and only seeks general information about the Club’s affairs, and in this regard, I accept that she will abide by any confidentiality orders made by this Court.
I did not find Ms Branson’s evidence of her understanding of the Applicant’s ultimate purpose of any assistance in determining the propriety of the Applicant’s purposes for inspection. In her view, the decision of Racing SA is immutable, and it is not in the Club’s best interests to try and persuade Racing SA to take a different stance.[43] Counsel for the Applicant described this as a fanciful objection that is untested and cannot count against the Applicant’s purpose for inspection.
[43] T79.6-.9.
I accept the Applicant’s submission in this regard. Just because the parties hold opposing views about jumps racing and what may be in the best interests of the Club is not to the point.
On the evidence, objectively considered, I am entirely satisfied that the Applicant is acting in good faith and seeks inspection of the Club books for proper purposes related to her rights as a Member. In circumstances where the Committee failed to consult the broader membership about a very significant, if not the most significant, decision made by the Committee in recent history, the Applicant is entitled as a first step to inspect and copy the Club’s books for her expressed purposes. That is, to investigate “what went on” as regards the Committee’s involvement and attitude to Racing SA’s decision to stop jumps racing in SA from 2022 and to understand the membership issues arising so as to formulate how it affects her interests as a Member, and if so advised, to institute proceedings as a next step in vindicating her rights as a member.
In the circumstances, I am entirely satisfied that it is proper for her to inspect the Club’s books to understand the Committee’s compliance with the Constitution for the election of members for the past 10 years by comparison with its recent approach to the membership applications of those who signed the requisition for the special general meeting and to understand how that affects the standing of the present Committee Members.
Although the Applicant is entitled to inspect the Club’s books, there are particular issues to be addressed by the scope of the categories described in the Application, which I now turn to consider. The Club’s reasonable concerns about the confidentiality of the Club’s books can be properly addressed by further orders and an appropriate confidentiality regime, the form of which orders I will hear from the parties.
THE SPECIFIC CATEGORIES SOUGHT
Categories 2.1, 2.2 and 2.7 of the application[44] - Committee Meeting Minutes since 1 August 2011
[44] The categories in paragraphs 2.1 and 2.2 overlap.
Counsel for the Club submitted it was unnecessary for the Applicant to inspect the Committee Meeting minutes to prove something that is uncontroversial. The minute books are sensitive and should not be handed out to the broader world. Further, the provision of access to 10 years of minutes was oppressive.
I reject the Club’s submissions.
First, as I have found, I am entirely satisfied of the Applicant’s good faith and the propriety of her inspection of the Club’s books for her expressed purposes. The minutes of Committee Meetings are important records and central to any understanding of how the Committee has managed the Club’s affairs. Minutes for Committee Meetings in more recent times will shed light on the Committee’s involvement in Racing SA’s recent decision and its attitude over time to the issue. As for the Committee’s practices for admission of Members over time, it is difficult for the Applicant to constrain the time period to other than the last 10 years without access to the Membership Register or knowing the dates that the present Committee Members joined.
Secondly, accepting Ms Branson’s evidence that there are usually about 10 Committee meetings held per annum and the minutes usually run to two or three pages, it is not oppressive for the Club to provide access to the minutes for Committee meetings held since August 2011 when these records are required to be kept under its Constitution and under s 51 of the AI Act.
These categories of documents are clearly relevant to either the Committee’s deliberations over whether to support Racing SA’s decision to cease programming jumps racing in 2022 and the Committee’s practices for the admission of members for the last 10 years in apparent disregard of the requirements of clause 9 of the Constitution.
Category 2.2 is in practical terms a subset of category 2.1. On the basis of the evidence before me, I consider the minutes of Committee meetings (whether formally or informally convened) are the only records of the Committee’s determination of membership applications (if any determination has in fact occurred). Accordingly, I consider category 2.7 overlaps category 2.1 and it is not necessary to order inspection of that category separately. In case there are draft minutes yet to be approved, I will include in my order for category 2.1, draft minutes.
Accordingly, I will authorise the inspection of all minutes of meeting of the Committee of the Club held since 1 August 2011, whether formally or informally convened, including drafts of any minutes not yet confirmed. I will hear the parties as to the terms of an appropriate confidentiality regime.
Category 2.3 – Communications between Members and/or the Committee and/or others in relation to the Requisition Notice
There is no challenge to the relevance of this category of books. The Requisition Notices are dated from 15 October 2021. I see no practical difficulty in the Club providing inspection of these books and I will make an order authorising inspection in these terms.
Category 2.4 – the Opinion of Queen’s Counsel
During the hearing on 1 December 20201, I ordered this opinion be provided to the Applicant under UCR 41.2. The opinion was tendered by the Club and comprises an exhibit before me.[45] I will make a further order authorising its inspection and copying. Given its nature, it is appropriate that the opinion be subject to a confidentiality regime and its use limited. I will hear the parties as to the terms of an appropriate confidentiality regime.
[45] Exhibit R14.
Category 2.5 – the Members Register
During the hearing on 1 December 20201, I also ordered this register be provided to the Applicant under UCR 41.2. I will make a further order authorising its inspection and copying and I will hear the parties as to an appropriate confidentiality regime to protect individual Members’ privacy.
Category 2.6 – all documents recording applications made to the Club and/or the Committee for membership of the Club since 1 August 2011
I am not prepared to make an order authorising inspection of all documents meeting this description because of the likely volume of applications and the breadth of documents that may be caught by this description, bearing in mind that the Register of Members is to be made available for inspection and copying and may provide the information sought.
If the Applicant wishes to press her application for this category of books after she has inspected the other books, I will hear the parties further.
Category 2.8 – all correspondence between the Club and/or the Committee and any persons in relation to an application for membership and/or the status of any person as a Member since 1 August 2011
This category is cast too broadly to be reasonable and is otherwise oppressive for the specified time period. I will authorise inspection of such correspondence for the current financial year only from 1 July 2021, to catch the Committee’s treatment of membership issues before and after the Requisition for a special general meeting.
Category 2.9 – all documents recording payment of any application fees, subscriptions fees or similar membership fees to the Club by any members or person applying to be Members of the Club since 1 August 2011
This category is also cast too broadly to be reasonable and is otherwise oppressive for the specified time period. I will authorise inspection of such correspondence for the current financial year only from 1 July 2021, to catch the Committee’s treatment of membership fees before and after the Requisition for a special general meeting.
Category 2.10 – any refunds paid to Members of any fees paid to the Club since 1 August 2011
This category is also cast too broadly to be reasonable and is otherwise oppressive for the specified time period. I will authorise inspection of such records for the current financial year only, from 1 July 2021 to catch the Committee’s treatment of membership fees before and after the Requisition for a special general meeting.
Category 2.11 – documents re communications, discussions or meetings with Racing SA regarding the cessation of jumps racing and the program for the 2022 Oakbank Easter Carnival
This category is unconstrained by time, although given its subject matter, it is likely to be constrained temporally in any event. I will authorise inspection of such records but confine them to the period commencing 1 January 2021.
Category 2.12 – Club bank statements from 1 March 2021
This category will show the banking of membership subscriptions and is relevant to the membership issues. I will authorise inspection of this category and hear the parties as to the terms of an appropriate confidentiality regime given the obvious sensitivity of banking records.