Woodrow v Canine Control Council (Queensland) Ltd (Trading as Dogs Queensland)

[2021] QSC 327

SUPREME COURT OF QUEENSLAND

CITATION:

Woodrow v Canine Control Council (Queensland) Ltd (Trading as Dogs Queensland) [2021] QSC 327

PARTIES:

CHRISTOPHER JOHN WOODROW

(applicant)

AND

CANINE CONTROL COUNCIL (QUEENSLAND) LTD (TRADING AS DOGS QUEENSLAND) CAN 160 285 192

(first respondent)

AND

AUSTRALIAN SECURITIES AND INVESTMENT COMMISSION

(second respondent)

FILE NO/S:

11532 of 21

DIVISION:

Trial Division

PROCEEDING:

Application

ORIGINATING COURT:

Supreme Court

DELIVERED ON:

10 December 2021

DELIVERED AT:

Brisbane

HEARING DATE:

28 October 2021

JUDGE:

Freeburn J

ORDERS:

1.          The court directs ASIC to rectify its register, such that Mr Woodrow be restored to the register as a director of Dogs Queensland with effect from 27 March 2019;

2.           The court declares that the resolution of the board on 10 May 2021 determining that Mr Woodrow had ceased to be a director of Dogs Queensland was ineffective to remove or otherwise have Mr Woodrow cease to be a director of Dogs Queensland; and

3.          The court declares that Mr Woodrow has been, at all times since 27 March 2019, and remains, a director of Dogs Queensland.

4.          The parties be heard on costs. 

CATCHWORDS:

CORPORATIONS – DIRECTORS – REMOVAL – VALIDITY – where the applicant’s membership to the respondent was suspended due to the applicant breaching the respondent’s media policy – where the term of the suspension of the applicant’s membership was extended on two further occasions – where  the respondent removed the applicant as a director for the respondent – where the applicant was removed as a director, by the respondent, on ASIC’s register – whether the board’s resolution determining the applicant had ceased to be a director of the respondent was effective to remove the applicant as director  of the respondent – whether the applicant, at all times, remains a director of the respondent – whether the respondent wrongfully removed the applicant as a director of the respondent on the ASIC register.

HNA Irish Nominee Ltd v Kinghorn (2010) 78 ACSR 553, cited.

Corporations Act 2001 (Cth), s 140

COUNSEL:

A O’Brien and M Windsor

(applicant)

M Stewart QC and T Jackson

(first respondent)

SOLICITORS:

Small Myers Hughes Lawyers

(applicant)

Russells

(first respondent)

REASONS

Introduction

[1]The first respondent (‘Dogs Queensland’) is an unlisted public company limited by guarantee.[1] The purpose of Dogs Queensland is to bring together people with an interest in breeding, training, and showing purebred registered dogs, and to provide them an opportunity to associate in order to promote best practice.[2]

[1]See page 165 in CJW-05 of the Applicant’s Affidavit dated 27 September 2021.

[2]Outline of Argument of the First Respondent at [7].

[2]On 27 March 2019, the applicant (‘Mr Woodrow’) was appointed as a director of Dogs Queensland.[3] At the time of his appointment as director, Mr Woodrow was a member of Dogs Queensland.[4]

[3]See CJW-04 and page 166 in CJW-05 of the Applicant’s Affidavit dated 27 September 2021.

[4]Applicant’s Affidavit dated 27 September 2021 at [7].

[3]From 14 January 2020, Mr Woodrow was subject of three decisions of an internal panel of Dogs Queensland called the Dogs Queensland Breaches Panel (the ‘Panel’).[5] The first decision of the panel, on 26 September 2019, imposed a penalty of suspension for 21 days because of a social media post published by Mr Woodrow. The second decision of the panel, on 14 January 2020, was that Mr Woodrow’s membership be suspended for 12 months on the basis of a contravention of Dogs Queensland’s social media policy. The third and last decision of the panel, on 25 May 2020, imposed a further suspension of three years, meaning that Mr Woodrow was suspended for a cumulative term of four years from 14 January 2020.[6]

[5]See CJW-06, CJW-07 and CJW-08 of the Applicant’s Affidavit dated 27 September 2021.

[6]Applicant’s Affidavit dated 27 September 2021 at [14]-[19].

[4]In parallel with those actions against Mr Woodrow, there were further actions taken by Dogs Queensland targeted at Mr Woodrow’s directorship. By a letter dated 22 January 2020, the General Manager of Dogs Queensland wrote to Mr Woodrow referring to the second decision of the Panel which suspended his membership for 12 months. The letter referred to Rule 79.5 of the Dogs Queensland Rules (the ‘Rules’) which provides as follows:

Any person whose membership is suspended or who is disqualified from membership is ineligible for the benefits of membership for the period of suspension or disqualification and no transactions of any kind will be processed on behalf of or involving that member.   

[5]The letter stated that one of the benefits of membership is an entitlement to stand for election as a director and to be a director. On the basis of Rule 79.5 Dogs Queensland stated that: ‘your position as a director is vacated until the end of your period of suspension.  At the end of the period of suspension, provided that your term has not expired, you again are entitled to the benefits of membership, i.e. to be a director of the company.’

[6]On 11 May 2021, that is the day before the hearing which led to the third decision of the Panel, the General Manger of Dogs Queensland wrote to Mr Woodrow saying that at the Dogs Queensland Board of Directors meeting on Monday 10 May 2021 the Board passed the following resolution:

The Board determines that Mr Woodrow ceased to comply with the requirements of being a Board member and thereby ceased to be a Director of Dogs Queensland (as defined in cl 2.1(5) of the Constitution) on 14 January 2020, upon his suspension as a member of Dogs Queensland. The Secretary shall lodge notification in ASIC that Mr Woodrow ceased to be a director on 14 January 2020.

[7]The board then lodged a Form 484 with the Australian Securities and Investments Commission (‘ASIC’) seeking to remove Mr Woodrow as a director on its register. ASIC have noted that change on its register for Dogs Queensland.

[8]Mr Woodrow seeks orders of the court to this effect:

a.   the court direct ASIC to rectify its register, such that Mr Woodrow be restored to the register as a director of Dogs Queensland  with effect from 27 March 2019;

b.   the court declare that the resolution of the board on 10 May 2021 determining that Mr Woodrow had ceased to be a director of Dogs Queensland was ineffective to remove or otherwise have Mr Woodrow cease to be a director of Dogs Queensland; and

c.   the court declare that Mr Woodrow has been, at all times since 27 March 2019, and remains, a director of Dogs Queensland. 

[9]Dogs Queensland opposes the proposed direction and declarations.

[10]At the hearing on 28 October 2021, an order was made pursuant to rule 304(1)(b) of the Uniform Civil Procedure Rules 1999 (Qld), which had the effect of discontinuing the proceedings against ASIC. I was informed that ASIC is not a necessary party and that ASIC have suggested some amendments to orders proposed by Mr Woodrow in the event he is successful in this application. Those suggested amendments have been embraced.[7]

[7]Transcript T1-3 line 3.

Mr Woodrow’s Arguments

[11]Mr Woodrow did not challenge his membership suspensions, or the facts underpinning those suspensions. Instead, Mr Woodrow contends that the suspension of his membership did not bring about the automatic cessation of his directorship.[8] Mr Woodrow contends that, on a proper construction of the Dogs Queensland Constitution and the Dogs Queensland Rules, a special general meeting is required before he could be removed as a director. That is because:

[8]Applicant’s Submissions at [2].

a.   his suspension as a member of Dogs Queensland, and any allegation that he missed board meetings without a leave of absence (although no board determination about the latter has been made) are not automatic triggers for removal; and

b. by clause 31.4 of the Constitution, in order to have Mr Woodrow so removed, it was required that a successful vote to that effect be conducted at a special general meeting. No special general meeting was ever held for this purpose.[9]  

[9]Applicant’s Submissions at [4].

[12]For those reasons Mr Woodrow contends that the board had no power to resolve to determine that he ceased to be a director upon being suspended as a member. And, he contends that Dogs Queensland was not entitled to lodge a Form 484 notifying ASIC that he should been removed as a director on the ASIC register.

Dogs Queensland’s Arguments

[13]First, Dogs Queensland argues that, on a proper interpretation of the Constitution and Rules, a person loses their eligibility to be a director and therefore ceases to be a director when they cease to hold the critical qualification – that of being a member of the company.[10]

[10]Outline of Argument of the First Respondent at [6].

[14]Second, Dogs Queensland contends that, properly construed, rule 31.4 only applies where a director ceases to satisfy the largely negative attributes set out in the proviso to clause 25.3. That leaves membership, and the consequences of the loss of membership to be dealt with elsewhere.[11]

[11]Outline of Argument of the First Respondent at [9].

[15]Third, the combined effect of clauses 25.3, 31.3, 31.4, and the definition of ‘Director’ in clause 2.1 of the Constitution is that to maintain one’s office as a director, a person must continue to be a member, and that upon a director’s membership being suspended, the directorship ceases.[12]  

[12]Outline of Argument of the First Respondent at [10].

Interpretation of Corporate Constitutions

[16]Pursuant to s 140 of the Corporations Act 2001 (Cth), the Constitution and the Rules have the effect of a contract between Dogs Queensland and each of its members, and each director and secretary, as well as between the members among themselves.

[17]Restraint must be exercised when having regard to surrounding circumstances that can be taken into account in construing the provisions of the Constitution and the Rules.[13] In HNA Irish Nominee Ltd v Kinghorn the court said:  

[13]Lion Nathan Australia Pty Ltd v Coopers Brewery Ltd (2006) 156 FCR 1 at [56] per Weinberg J.

In giving a commercial contract a business-like interpretation, it is necessary to consider the language used by the parties, the circumstances addressed by the contract and the objects that it is intended to secure: International Air Transport Assn v Ansett Australia Holdings Ltd (2008) 234 CLR 151 at 160 [8] per Gleeson CJ; see too at 174 [53] per Gummow, Hayne, Heydon, Crennan and Kiefel JJ. A corporate constitution has the effect of a contract between the company and each of its members, the company and each director and secretary, as well as the members amongst themselves (s 140(1) of the Act). The range of surrounding circumstances available as aids to the construction of such a contract is perhaps more limited than in other cases. This is because constitutions, and replaceable rules, can be amended at different times and in different circumstances. In addition, the members who are the corporators at particular times may change. These factors suggest that ordinarily primacy must be given to the objective intention discernable from the language in which the constitution is expressed rather than to other features of the surrounding matrix of fact in which its provisions may have been made.[14]

[14](2010) 78 ACSR 553 at 563 [42] per Keane CJ, Jacobson, and Rares JJ.

[18]The Constitution here bears all the hallmarks of a document that has been amended at different times for different purposes.

Meaning of ‘Member’

[19]It is necessary to start with the meaning of a ‘member’ of this corporate body. The Constitution defines a ‘Member’ as ‘[a]ny current Member of [Dog Queensland] registered in accordance with the relevant clauses of this Constitution’.[15]

[15]Constitution clause 2.1 (definition of ‘Member’).

[20]Clause 12 outlines the relevant privileges of membership. One of the many privileges of membership is the ‘right to nominate for appointment to the Board of Directors’ of Dogs Queensland.[16] It will be necessary to return to clause 12.

[16]The Rules r 12.1(6).

Meaning of ‘Suspended Member’

[21]Mr Woodrow’s membership was suspended for a cumulative term of 4 years. The term ‘suspension’ is defined in the Rules as:

… the stoppage of all rights and privileges normally conferred by membership of the [Dogs Queensland] for a period of time. Membership is reinstated automatically on completion of the period of suspension, provided that membership fees have been paid throughout the period.[17]

[22]That definition of suspension is consistent with the ordinary dictionary meaning of a ‘suspension’ which is a ‘temporary abrogation, as of law or privilege’.[18]

[23]Rule 14.1 provides:

14.1Membership of [Dogs Queensland] shall cease ipso facto:

(1)Upon the expiration of the period of membership, whether by the expiration of time or otherwise, unless the member shall be readmitted by the Board of Directors for a further period of membership’

(2)If the member resigns, by notification in writing;

(3)If the member dies;

(4)If the member’s annual subscription remains unpaid on the second day after the Annual General Meeting in  March first ensuing after the year in which the person was a financial member; or

(5)if the member is suspended from membership of [Dogs Queensland] or disqualified or otherwise declared ineligible to take part in any capacity in an Exhibition for the term of such suspension, disqualification or ineligibility;[19] [emphasis added]

[17]The Rules, r 3.1 (definition of ‘suspension’).

[18]The Macquarie Concise Dictionary 3^rd edition.

[19]The Rules, r 14.1.

[24]Rule 14.1(5) makes clear that the effect of a suspension is to immediately nullify the person’s membership but only for the term of the suspension.  Thus, the object of rule 14.1(5) appears to be that, not only does a suspended member cease to be entitled to the benefits of membership for the period of the suspension, but the suspended member loses his status as a member for the period of the suspension.

[25]Counsel for Mr Woodrow contended for the contrary. For Mr Woodrow, it was contended that ‘legal status’ and ‘rights and privileges’ are two distinct concepts under the regime created by the Constitution and Rules. According to that argument rule 14.1(5) means that the rights and privileges that attend membership cease on suspension, rather than membership as a legal status. In other words, the argument is that Mr Woodrow’s legal status as a member survived his suspension.

[26]Mr Woodrow’s counsel’s interpretation is premised on the following four considerations. 

[27]First, in the cases of both ‘disqualification’ and ‘suspension’ the benefits of membership are removed by rule 79.5 of the Rules. However, counsel for Mr Woodrow contend that the Rules distinguish the two concepts, in that a ‘disqualification’ results in the termination of the person’s legal status as a member, which is not the case for a ‘suspension’.[20] More specifically, rules 79.3 and 79.4 of the Rules state:  

79.3  Any member of the [Dogs Queensland] or Affiliate disqualified by the [Dogs Queensland] … shall not be entitled to the return of his/her annual subscription or other fees or any portion thereof. Any member who has been disqualified must reapply for membership after the period of disqualification has expired.

79.4  The membership of any member whose membership is suspended in accordance with these Rules will be automatically reinstated either on completion of the period of suspension imposed or upon completion of all outstanding actions required as the case may be and all membership fees have been paid for each year throughout the period of suspension.

(emphasis added)

[20]Transcript T1-7 lines 33-36.

[28]It is doubtful that distinction between disqualification and suspension overcomes the relatively plain language of rule 14.1(5) and, in particular, the use of the language of ‘membership shall cease ipso facto’. A disqualification from membership occurs immediately. A suspension from membership may still occur immediately but be able to be revived by automatic reinstatement, without the need for a fresh application for membership.

[29]Second, if a suspended member wishes to be reinstated as a member upon the completion of the suspension, the suspended member is required to continue to pay membership fees throughout the period of suspension.[21] The Constitution likewise imposes an obligation on Dogs Queensland to restore the suspended member’s rights and privileges at the end of the suspension period. Those mutual obligations, counsel for Mr Woodrow submits, support the interpretation that membership as a legal status continues to operate during the period of suspension.

[21]The Constitution, cl 13.

[30]It can be accepted that those ‘mutual obligations’ mean that a suspended member’s status is different from that of a disqualified member. But it is to be doubted that the membership of a suspended member can be regarded as a membership which still exists. Rule 14.1(5) makes explicit that a suspended membership ceases immediately. When the suspension lifts, the membership resumes. That occurs provided that the suspended member has paid his membership fees.

[31]Incidentally, on that point, Mr Woodrow submitted that ‘[a]t all times from the date that my membership of Dogs Queensland commenced to the date of this Affidavit [being 27 September 2021], I have paid all my membership fees as requested by Dogs Queensland’.[22] 

[22]Applicant’s Affidavit dated 27 September 2021, at [11].

[32]Third, counsel for Mr Woodrow points out that clause 17 of the Constitution provides a comprehensive mechanism that must be adhered to prior to a membership being terminated. That is true. However, it does not detract from the plain words and effect of rule 14.1(5).

[33]Fourth, Mr Woodrow’s counsel point out that the Constitution provides that membership of Dogs Queensland includes ‘such other classes of member as may from time to time to allowed under the Rules’.[23] It is contended that this phrasing supports the idea that suspended members maintain their legal status as members throughout the period of their suspension, irrespective of the limits imposed on their rights.

[23]The Constitution, cl 11.1(7).

[34]That is doubtful. A provision that caters for different classes of membership can hardly be said to justify the conclusion that a suspended member’s status as a member continues throughout that member’s suspension. That is because, in plain terms, rule 14.1(5) explicitly provides that the membership of a suspended member ceases upon his suspension.

[35]In my view, the language of rule 14.1(5) is sufficiently clear. The membership ceases on the suspension. Mr Woodrow’s membership of Dogs Queensland ‘ceased ipso facto’ upon the Panel suspending his membership. To read rule 14.1(5) in any other way would inflict some violence on a plain and literal reading of the clause. However, that does not mean that Mr Woodrow had no status at all. His membership was capable of being revived provided he continued to pay his membership fees.

[36]It is also worth observing that the words of the Dogs Queensland Constitution and Rules do not require that a suspended member be ascribed a particular legal status. It may be useful to apply a conventional legal taxonomy to the status of a suspended member, but the words of rule 14.1(5) are plain enough that a suspended member no longer has the status as a member.

[37]Next, counsel for Mr Woodrow submits that, even if Mr Woodrow’s membership was deemed to be extinguished upon his suspension, Mr Woodrow’s position as a director remains unchanged. The submission is that Mr Woodrow’s directorship does not cease in the absence of a Special General Meeting. On this point, in my view, Mr Woodrow’s counsel is on a sounder footing.

Meaning of ‘Director’ and Removal of Directors

[38]The Constitution defines a ‘Director’ as ‘[a] duly elected member of the Board of [Dogs Queensland], eligible to be a member of the Board in accordance with clause 25.3’.[24] Further, ‘[a]ll Members elected to the Board in accordance with this Constitution shall hold office from the close of the Annual General meeting for a four (4) year period.’

[24]The Constitution, cl 2.1 (definition of ‘Director’).

[39]The Constitution explicitly provides a mechanism for the removal of directors This mechanism is found in subclauses 31.3 to 31.7 of the Constitution, which provides:

31.3    The Board may determine that a Director has ceased to comply with the requirements of being a Board member if the Director:

(1)    becomes bankrupt or suspends payment or compounds with his or her creditors;

(2)    becomes of unsound mind or a person whose person or estate is liable to be dealt with in any way under the law relating to mental health;

(3)    is not present at three (3) consecutive meetings and does not have special leave of absence;

(4)    ceases to be qualified as a Director under clause 25.3;

(5)    Becomes disqualified from being a Director under the Act or any order made under the Act;

(6) Is removed from office in accordance with clause 31.6; or

(7)    Resigns from office in accordance with clause 31.1.

31.4If the Board determines that one (1) of their number has ceased to comply with the requirements for being a Board member under clause 25.3 or should otherwise be removed from office, then the Board may call a Special General Meeting to determine whether the Board member should be removed, or a Special General Meeting requested pursuant to clause 47.1(2).

31.5Before a vote of Members is taken about removing the Director from office, the Board member must be given a full and fair opportunity to address the meeting and to show cause why he/she should not be removed from office.

31.6If more than fifty (50%) of Members present at a Special General Meeting determine that a Director ought to be removed, then the Board member ceased forthwith from the position.

31.7A Director of the Board has no right of appeal against his removal at a Special General Meeting but may stand at the next election if otherwise eligible. [emphasis added]

[40]The evident objective of those provisions is to regulate the removal of directors by making their removal subject to, first, a determination by the board and then, second, a vote of members at a Special General Meeting. Directors are elected by the members and so the intention is that they should be removed by a vote of the members.

[41]As can be seen, clause 31.3 of the Constitution provides that the Board may determine that a Director has ceased to be qualified as a director under clause 25.3 of the Constitution. Clause 25.3 provides that:

25.3Any current Ordinary or Honorary Life Member of [Dogs Queensland] of at least five (5) years standing, including equivalent membership of an interstate Canine Controlling Body, may stand for election as a Board member provided that the Member:

(1)is eighteen (18) years of age or older;

(2)has not been convicted of an indictable offence or summary offence resulting in a term of imprisonment or an offence involving cruelty to animals;

(3)is eligible to be a Director of a company in accordance with the Corporations Act 2001 (Cth);

(4)is not an undischarged bankrupt under the Bankruptcy Act 1966 (Cth) or the corresponding law of an external territory or of another country;

(5)has not executed a deed of arrangement under Part X of the Bankruptcy Act 1966 (Cth) or the corresponding law of an external territory or of another country;

(6)does not have creditors who have accepted a composition under Part X of the Bankruptcy Act 1966 (Cth) or a corresponding law of an external territory or of another country and a final payment has not been made under the composition; and

(7)is not an employee of [Dogs Queensland].

[42]The Board has not made a determination that Mr Woodrow has ceased to comply with clause 25.3. It is not disputed that Mr Woodrow fulfills the requirements of clause 25.3. And, Dogs Queensland concedes that Mr Woodrow did not cease to be a director by a vote of the members.[25]  Counsel for Dogs Queensland submitted that ‘we don’t make a contention that anything that the board of the company has done had the effect of removing Mr Woodrow from his position as the director of the company’.[26] Rather, Counsel for Dogs Queensland contends that, by virtue of the operation of the Constitution and Rules, Mr Woodrow ceased to be a director of Dogs Queensland by reason of his suspension.[27]

[25]Affidavit of James Bernard O’Brien at JBO-2.

[26]Transcript T1-4 lines 26-30.

[27]Applicant’s Second Supporting Affidavit at CJW-14, p.65.

[43]Mr Woodrow, it is argued by Dogs Queensland, became ‘disqualified from being a Director’ when he ceased to be a member.[28] That argument is said to be supported by the following contentions.

[28]The Constitution cl 31.3(4); Transcript T1-13 and T1-18 lines 39-44.

[44]First, counsel for Dogs Queensland contends that this is not a profit-making enterprise. It is a company limited by guarantee which has, as its purpose, to provide people with an interest in breeding, training and showing purebred registered dogs with an opportunity to associate in order to promote good practice in these fields and pursue their interest that brought them together at the same time.[29] These people, it is said, are members not shareholders. That all may be true. However, the central and important issue is what is set out in the Constitution and Rules.

[29]Outline of Argument of the First Respondent at [7].

[45]Second, counsel for Dogs Queensland argues that the language of clauses 25.3, 31.3, 31.4 and the definition of ‘Director’ in clause 1.1 preclude an argument that all a person must do to be entitled to continue to be a director is to satisfy the elements of clause 25.3 only at the moment of election.[30] Those provisions, it is said, point to the necessity that a person continue to satisfy those elements in order to occupy the position of director.

[30]Presumably this is intended to refer to the moment of nomination.

[46]That is not an accurate summary of the effect of clauses 25.3, 31.3, 31.4 and the definition of ‘Director’ in clause 1.1. Those clauses provide a two-step process. The first step is that the board can determine that one of their number has ceased to meet the requirements of being a board member – for example by becoming a bankrupt or by being convicted of an indictable offence. If the board makes such a determination, then there is no automatic removal of the director. Instead, the second step is activated. A Special General Meeting is called, the director is entitled to address the meeting, and the members vote. Only if more than 50% of the members vote that the director should be removed is the effect that the director ‘ceases forthwith’ to hold his position as director.[31]    

[31]Constitution, clause 31.6.

[47]It seems reasonably clear from that scheme that none of these clauses specify that continued membership is a requirement of directorship. And even a bankrupt who is a convicted criminal is entitled to a full and fair opportunity to address a Special General Meeting before the members vote on whether he or she should be removed.

[48]Third, counsel for Dogs Queensland contends that, properly construed, clause 31.4 concerns only circumstances where a director ceases to satisfy the largely negative attributes set out in the proviso to clause 25.3. Again, that is not accurate. Clause 31.3 enables the board to make a determination that a director has ceased to comply with the requirements of being a board member. Clause 31.4 provides that, in the event that the board makes such a determination, the board has the ability to call a Special General Meeting. Clause 31.4 is not restricted to those cases where the director has failed to comply with clause 25.3. The failure of a director to be qualified as a director under clause 25.3 is only one of the many events that might lead to the two-step process explained above.

[49]Fourth, counsel for Dogs Queensland argued that the combined effect of clauses 25.3, 31.3, 31.4 and the definition of ‘Director’ in clause 1.1, read as a whole, is that to maintain one’s office as a director, a person must continue to be a member, and that upon his or her membership being suspended, the directorship ceases.  That argument is not accepted.

[50]Membership is not specified as one of the requirements of being a board member in clause 31.3. And the ‘qualifications’ in clause 25.3 merely specifies that any current ordinary member or a life member of at least 5 years standing may stand for election. That is consistent with Rule 12.1 which specifies that one of the privileges of membership shall include the right to nominate for the appointment to the board of Dogs Queensland.

[51]It is important to note that this particular privilege, which is accorded to members, is a right to nominate for appointment to the board. Thus, there is a temporal limitation in that a person needs to be a member at the time they nominate for appointment to the board. Rule 12 does not require that a person be a member, and remain a member, throughout their term as a director.

[52]That particular privilege of membership, the right to nominate for the board, can be contrasted with the language of r 12.1(8) of the Rules which is a right to ‘hold an office-bearer position on the Committee of an Affiliated Club’ [emphasis added]. The Constitution contains detailed provisions relating to affiliates.[32]

[32]See the rr 4 to 9 of the Rules, including clause 5 which deals with applications for affiliation. Rule 7.4 of the Rules provides that a person must be a financial member of Dogs Queensland, and a resident of Queensland in order to hold office on the committee of an affiliate (other than an Agricultural Show Society.

[53]Consequently, the plain language of r 12.1 of the Rules does not make membership an eligibility requirement for a board position. It merely requires membership at the time of nomination for a board position. The same applies to

[54]Conspicuous by its absence is any requirement in the Constitution or Rules is any requirement that directors must continue to be members. Nor is there any compelling reason why that would be the case. Corporations, including not-for-profit corporations might well not require their directors to be shareholders or members.

[55]Nor is it inappropriate for a suspended member to remain a director. A member may be suspended for a short time because of some minor indiscretion. If Dogs Queensland’s argument were correct, that would mean that a member who was suspended for a week for a minor indiscretion would automatically lose their position as a director which they would otherwise hold for four years. All of that is inconsistent with the scheme in clauses 31.3 to 31.7 which goes to some effort to ensure that even a convicted criminal has a right to address a Special General Meeting regarding his or her removal as a director.

[56]Further, as Counsel for Mr Woodrow submitted:[33]

[33]Transcript T1-24, lines 32-5.

If the suspension brought about an automatic or instantaneous cessation of directorship, 31.4 would not have any work to do, and that would be a difficult proposition to accept in this case, where 31.4 expressly refers to ceasing to comply with the requirements for eligibility under 25.3.

[57]Finally, I should return to the letter written by the General Manager of Dogs Queensland to Mr Woodrow dated 22 January 2020, which was quoted above. It will be recalled that that letter referred to the second decision of the Panel which suspended his membership for 12 months. The letter relied on Rule 79.5 of the Rules which provides as follows:

Any person whose membership is suspended or who is disqualified from membership is ineligible for the benefits of membership for the period of suspension or disqualification and no transactions of any kind will be processed on behalf of or involving that member.  

[58]It can be accepted that, for the period of his suspension, Mr Woodrow lost all of the benefits of membership. That included the right to nominate for a position as a director. However, his loss of those benefits had no consequence because he had already been elected as a director and so the regime for removing directors applied. That regime is found in subclauses 31.3 to 31.7 of the Constitution. Thus, the General Manager’s reliance on Rule 79.5 was misplaced. The same applies to the General Manager’s letter of 11 May 2021.

[59]For those reasons, in my view, the proper interpretation of clause 31 requires Dogs Queensland to hold a Special General Meeting, before a Director may be removed from their position. It is appropriate to give the direction and declarations sought by Mr Woodrow.