Woolmore v Sporting Shooters Association of Australia

SUPREME COURT OF VICTORIA	Do not Send for Reporting
PRACTICE COURT	Not Restricted

No. 6518 of 1998

WILLIAM WOOLMORE	Plaintiff
KEVIN JOHN ARDITTO	Second Plaintiff
v
SPORTING SHOOTERS ASSOCIATION OF AUSTRALIA (VICTORIA) ACN 005 020 422

Defendant

JUDGE:	HARPER, J.
WHERE HELD:	MELBOURNE
DATE OF HEARING:	21 JULY 1998
DATE OF JUDGMENT:	21 JULY 1998
MEDIA NEUTRAL CITATION:	[1998] VSC 1

CATCHWORDS: Associations and Clubs - Failure to include items on agenda for annual general meeting - Application to defer annual general meeting - Whether Association obliged to disseminate motion even if likely to be defamatory.

APPEARANCES:	Counsel	Solicitors
For the Plaintiffs	Mr. S. Wilmoth	A.J. Macken & Co.
For the Defendant	Mr. P. Pascoe	Ebsworth & Ebsworth

HIS HONOUR:

The Sporting Shooters Association of Australia (Victoria) is a company limited by guarantee. Each of the plaintiffs is a member. Each has a particular interest in the Association's annual general meeting for 1998, which is scheduled to be held next Saturday, 25 July.
Mr. Woolmore wished to submit a motion to the meeting. The articles of association require that, in these circumstances, the motion be delivered to the secretary of the defendant not less than 42 days before the day upon which the meeting is to be held. Mr. Woolmore duly presented his motion to the secretary on 12 June: the 43rd day before 25 July.
Notice of the motion was not given to the members of the Association when the agenda was distributed, as required by the articles, not less than 14 days before the date of the meeting. The omission was deliberate. I accept that officials of the Association were left in some disquiet about its terms, and about the terms of an explanatory note which accompanied the motion. The motion, together with the explanation, were in the following terms:
"That Victorian delegates to SSAA National pursue the recovery from Ted Drane of the tens of thousands of dollars paid to him from members' funds to finance dubious and unsuccessful private litigation, mostly conducted through his wife's law firm, against other SSAA members.
Explanation:
Two actions in particular against former National Presidents have been a scandalous waste of members' funds and the SSAA stood to gain nothing from them. The presiding judge described Drane's action in one case as 'childishly spurious'. The Association's auditors have already drawn attention to this manner of using members' funds. The money, totalling up to $50,000, must be recovered from him and returned to the SSAA."
Mr. Sebastian Ziccone, the President of the Association, on 20 July 1988 swore an affidavit in this proceeding. He described his, and the Association's Executive Council's, reaction to the motion in the following terms:
"I had and have serious concerns that the wording of the proposed motion is defamatory and may be indicative of malice on the part of Woolmore. My fear at the very least was that the wording of the motion was inflammatory and designed to provoke an adverse reaction from Mr. Drane and possibly to involve the Association in litigation. I considered that it was my duty and also a duty of the Executive Council to protect the members' funds and not to involve it in unnecessary disputation.
After taking legal advice and after an extraordinary meeting with the Executive Council it was decided not to publish the motion referring to the retrieval of funds from Mr. Drane. On 29 June 1998 I wrote to Woolmore to that effect. In that letter I informed Woolmore that legal advice had indicated that the motion was defamatory in nature. It was further pointed out that the content was materially incorrect and as such the Executive Council decided that it would not be published."
Mr. Woolmore now seeks, in effect, an order requiring the Association to distribute his motion to its members. He also seeks orders the effect of which would be to postpone the holding of the annual general meeting until proper notice of the motion has been given. He submits that the motion should be considered by the Association in the context of a full annual general meeting, and that his interest in having it adopted might be adversely affected were it to be considered at a time and place other than that at which the balance of the business of the annual general meeting was to be transacted.
Mr. Arditto also seeks the postponement of the annual general meeting. He wishes to stand for the position of Finance Committee Convener. His form of nomination was submitted in accordance with the Association's articles. It was rejected on the mistaken basis that the member who proposed Mr. Arditto's candidature was not eligible to do so. The Association now accepts its mistake. In the meantime, however, the notice of the meeting was forwarded to the members of the Association without reference to Mr. Arditto's candidature; indeed, that notice indicated that the office of Finance Committee Convener would be filled by the person who was said to be the only nominee - with the result that (according to the notice) no election was necessary.
In these circumstances, Mr. Arditto submitted that the whole of the annual general meeting should be postponed to a date after proper notice of his nomination had been given to the members. He adopted Mr. Woolmore's position - namely, that he might be prejudiced were the election for Finance Committee Convener to be conducted at a time and place other than that at which the general business of the annual general meeting was to be transacted.
I need not concern myself about the question whether the Association dealt appropriately with Mr. Arditto's nomination. It clearly did not, and has admitted as much. The only question, therefore, concerns the consequential relief to which Mr. Arditto is now entitled. Mr. Woolmore's position in this regard is somewhat different, in that the Association defended the position which it took in relation to his motion. In my opinion, however, that defence should not be upheld. Officers of an association such as the defendant have a duty to distribute to members of the association notice of motions which have been properly submitted to it. It is not for those officials to determine whether or not a proposed motion might or might not be defamatory, or might or might not "provoke an adverse reaction". If the relevant rules of the association require (as the articles of the defendant require) the distribution to members of notices of motion, then it is the duty of the relevant officers of the body in question to act accordingly. That duty will give rise to a privilege available as a defence in any proceedings in defamation which might later be taken against the official or officials concerned. Such a defence could only be defeated if it were proved that the person or persons involved in the distribution acted with malice. Of course, in carrying out their duties under the rules of the body in question, the official or officials concerned might expose themselves to proceedings in defamation; but that is a risk which necessarily adheres to the duties of the relevant office. And although the risk of being named as a defendant cannot be avoided, an official who acts without malice should be successful in any resultant litigation. Moreover, if malice is indeed absent, the risk of an adverse judgment can be minimised by taking such steps as attaching an appropriate disclaimer with the document giving notice of the motion in question. There may well be other methods, too, by which an official required to do his or her duty in the way I have indicated could properly (and at a very early stage) demonstrate absence of malice.
For these reasons, and acting pursuant to the authority of Hay v. The Australasian Institute of Marine Engineers (1906) 3 C.L.R. 1,002, it seems to me that the Association was wrong to withhold distribution of Mr. Woolmore's motion.
At the same time, I do not accept the plaintiffs' submission in relation to the timing of the annual general meeting. Given the very short interval between the hearing of this proceeding and next Saturday, postponement of the meeting would cause great inconvenience to a large number of members of the Association who may have nothing to do with the present dispute. Moreover, although I have no evidence on the point, it is likely that postponement of the entire meeting would be a greater financial drain on the resources of the Association than would follow from the adjournment of so much of the annual general meeting as is necessary to deal with Mr. Woolmore's motion and the election for the position of Finance Committee Convener. Accordingly, it seems to me that the course of least inconvenience is to make orders which will enable the meeting to be held next Saturday, but without either Mr. Woolmore's motion or the election to the office of Finance Committee Convener being part of that day's business.
I do not think that either plaintiff would necessarily be prejudiced were the business with which he is particularly interested dealt with at a time after the other business of the annual general meeting has been transacted. It is true that, to an indefinable extent, some business at any meeting may impact upon other business, so as to affect its outcome. On the other hand, Mr. Woolmore's motion would almost certainly be put after the election in respect of which Mr. Drane is a candidate and, therefore, after the outcome of that election is known. While those who might support Mr. Woolmore's motion are for that reason unlikely to look favourably upon Mr. Drane's candidature, nevertheless the fact that the motion will be debated at a time other than that at which the election is conducted, should not materially impact upon the outcome of the election. Mr. Woolmore will, of course, be in a position, immediately before the election is held, to put before the meeting such arguments as are relevant to both the election and his motion.
Mr. Arditto is, I understand, a member of a team of candidates who are putting themselves forward as such for election to nominated positions within the Association. I am nevertheless of the view that postponement of the election for the position of Finance Committee Convener is not likely materially to affect the outcome of that election; or, at the very least, consideration of the likely effect involves so many imponderables as to make it impossible to draw any conclusions one way or the other.
In these circumstances, given the inconvenience which would necessarily follow were the entire meeting to be postponed, it seems to me appropriate that it should proceed as I have indicated. Having dealt with the business of which proper notice has been given, the meeting should then adjourn to a time the fixing of which will make proper allowance for notice to be given in accordance with the articles of the defendant of Mr. Woolmore's motion and Mr. Arditto's candidature for election. I indicate that, in my opinion, distribution of the Woolmore motion will not involve any official of the Association who participates in that distribution in liability for action in defamation. Even if (which I do not decide one way or the other) the motion is defamatory, no official who acts without malice would in my opinion be the subject of a successful defamation action.
I will ask the parties, by their counsel, to submit orders which reflect these reasons for judgment.

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[1998] VSC 1

21 July 1998