Xiberras v Wurundjeri Tribe Land and Compensation Cultural Heritage Council Inc
[2005] VSC 457
•15 November 2005
| IN THE SUPREME COURT OF VICTORIA | Not Restricted | |
AT MELBOURNE
PRACTICE COURT
No. 6628 of 2005
| ANNETTE XIBERRAS | Plaintiff |
| v | |
| WURUNDJERI TRIBE LAND AND COMPENSATION CULTURAL HERITAGE COUNCIL INC. & ANOR | Defendants |
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JUDGE: | HANSEN J | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 15 November 2005 | |
DATE OF JUDGMENT: | 15 November 2005 | |
CASE MAY BE CITED AS: | Xiberras v Wurundjeri Tribe Land and Compensation Cultural Heritage Council Inc. | |
MEDIUM NEUTRAL CITATION: | [2005] VSC 457 | |
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Orders – Consent orders on Originating Motion – Application by defendant to discharge certain of the orders and make other orders – Whether power to do so – Whether orders interlocutory – New facts.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Ms A Richards QC with Mr M P Barrett | Clayton Utz |
| For the First Defendant | Mr E W Woodward | Maddocks |
| For the Second Defendant | Mr W F Gillies | Allens Arthur Robinson |
HIS HONOUR:
An unfortunate dispute within the Wurundjeri community led to an originating motion being filed on 16 June this year by Annette Xiberras, an elder in that community, against the Wurundjeri Tribe Land and Compensation Cultural Heritage Council Inc. (“the council”), and Allan Wandin, also a member of that community, who was acting as the Chief Executive Officer of the council.
The motion sought a range of relief, commencing with an order that a receiver and manager be appointed to the council until a proper governing body had been appointed to it in accordance with any declaration made by the Magistrates’ Court pursuant to s.14A of the Associations Incorporation Act 1981 as to the rights and identity of persons who are entitled to vote and elect the governing body of the council or, further or in the alternative the Rules of Incorporation of the council.
Other relief sought was an injunction restraining the defendants from dealing in or disposing of or encumbering assets of the council, and that each defendant provide an affidavit as to their knowledge of matters concerning assets of the council and their disposition.
In the usual way the proceeding was referred to the judge in the Practice Court and on 24 June this year it came before Cummins J when an order was made by consent of the parties. In the Other Matters section of the order a number of matters were recited following which a series of orders, numbering eleven in all, were made.
What is stated in Other Matters is consistent with that which is deposed to in the affidavits in support of the proceeding, and which was referred to in argument, namely, a deal of unfortunate disputation, discord and distrust among those in the community and concerning the second defendant.
In the Other Matters section of the order the following is stated:
“The Hunter, Xiberras and Wandin families agree that a new governance structure for the Wurundjeri Council shall be formulated and adopted together with a constitution and rules (if necessary) in order that any future deadlock in the management and control of the Wurundjeri Council be, as far as possible, averted.
Liberty to apply in order 9 is reserved generally but also for the express purpose of reviewing order 8 in the event that neither the Magistrates’ Court proceedings have been finalised nor has a special general meeting been convened of the Wurundjeri Council within 3 months of the date of this order.
AND UPON:
Allan Wandin undertaking to the Court to use his best endeavours to expedite the Magistrates’ Court proceedings and resolve the question of Wurundjeri Council voting entitlement.”
The reference to a proceeding in the Magistrates’ Court was to a proceeding instituted to obtain the relief specified in the originating motion to which I referred earlier. A proceeding has been commenced in the Magistrates’ Court for that purpose and a hearing has been fixed for 12 December with four days allowed. As Mr Gillies said, one cannot be certain that the case will be heard then or, if it is, when a decision will be given. The purpose is to have clarity as to those who are entitled to vote on the composition of the council which can then determine who is to be engaged as the Chief Executive Officer of the council, the affairs of which can then, hopefully, proceed in an orderly way.
It is evident from the affidavits and from the orders themselves, that there was a deal of background to the orders that were made by Cummins J. The orders are readily seen as intended to lay down a regime under which the council could continue to operate until resolution of the question of voting entitlement. It is important to remember that the council was deadlocked, there was a risk of winding up which would have had serious consequences and the orders, which were made by consent, averted those consequences. I now refer to the orders.
It is important to attend to the terms of the orders because therein lies a difficulty for the present application which seeks that a number of them be discharged.
The first order is a restraint on the defendants until the council is in a position to convene a special general meeting and make valid resolutions or until further order, from dealing with, withdrawing, disposing of or encumbering assets of the council other than in the ordinary course of business. While there is no doubt that a court has power to vary or discharge an injunction so expressed, it is not clear that that is the case with other orders sought to be discharged.
Paragraph 2 of the orders appointed a named accountant to conduct an investigation into the books and records of the council over the past seven years with his costs to be borne by the council. That order is not expressed to be subject to further order. It is a consent order for the appointment of a person to conduct a stipulated investigation with the costs to be borne by one of the parties. There is no provision for the named accountant to report to the court. The order is not subject to further order or a reservation of any supervisory or other control by the court. In short the court has nothing to do with the investigation under the terms of the order.
Paragraph 3 of the orders provided that until the council is in a position to convene a special general meeting and make valid resolutions, an archaeologist or other suitable person be retained by agreement between the plaintiff and second defendant forthwith to act as Chief Executive Officer of the council to undertake and manage the affairs of the council and provide archaeological expertise.
Paragraph 4 provided that the staff of the council be reviewed by the archaeologist in order that all the Wurundjeri families be appropriately represented on the staff.
Paragraph 5 ordered that the second defendant desist from all management and control of the Wurundjeri council affairs. Again, that order was not expressed to run until further order.
Paragraph 6 ordered that the registered office of the council be changed to an address appointed by the archaeologist. Then there were two orders concerning the second defendant. That in paragraph 7 provided that the second defendant retain the use of a motor vehicle belonging to the council on weekends only for a period of three months.
Paragraph 8 ordered that the second defendant shall continue to receive a salary of $38,000 per annum, and continue to reside at a stipulated address, subject to a valid resolution of the council terminating or confirming his employment or term of residence. I think what the order meant was that he had the right to reside at the stipulated address. I say that because otherwise the order reads in a rather unusual way in that it required him by positive order to reside at that address, in effect whether he wanted to or not.
Overall, one can see that there was in mind the matter of the Magistrates’ Court proceeding and a hoped for resolution on the matter of the ability of the council to convene a special general meeting and make valid resolutions. On that happening a chief executive officer could be appointed and the council could move forward. It would not have been necessary to return to the Court.
Then by order 9, liberty to apply was granted. By order 10, costs were reserved. And by order 11, the proceeding was adjourned sine die.
The reason for referring to all these matters is that in terms there is about these orders, or most of them, the appearance of final orders in the proceeding and the question is what would ‘liberty to apply’ apply to. The Other Matters section of the order states that it was reserved generally, and one might understand that as being for the purpose of coming back, if necessary, for orders or directions of a mechanical or administrative nature for the better implementation of that which had been ordered, but it was also recited in the Other Matters section of the order that liberty to apply was reserved for the purpose of reviewing order 8, as I mentioned earlier. That would tend to suggest that if the court proceeding had not been finalised or a special meeting convened within three months, the continued right to receive the salary or reside at the stipulated address might be called into question or reviewed, to use the word in the order. But that is perhaps speculation on my part because notwithstanding that I have heard some things from the Bar table, I do not actually have evidence as to the reason or reasons for particular drafting in the order and I must take it as it appears on its face.
It is in that context that the second defendant filed a summons on 3 November for a series of orders affecting the orders made by consent last June. In the first place the application is that orders numbered 1, 3, 4, 5, 6 and 7 be discharged. Secondly, that the contract for services between Ms Goulding, the plaintiff, and the second defendant, dated 9 August 2005, be terminated. Thirdly, that the second defendant perform the role of Chief Executive Officer of the council until such time as a special general meeting of the first defendant is convened to elect a Chief Executive Officer. Fourthly, that the registered office of the council be changed to 19 Barrick Lane, Healesville, Victoria, which is the address stipulated in the order of June at which the second defendant may reside. And fifthly, that order number 7 be extended for a period of six months from 24 September 2005. Order number 7 was that which entitled the second defendant to use the motor car at weekends for a period of three months from the date of the order.
In the course of the argument this afternoon, Mr Gillies said that he did not press the six month extension of order number 7. There are two things to note about this. The first is that the period of three months expired on 24 September 2005. Hence, what is sought is a new order. As to that, the June order did not contain provision for a further order. Moreover it would be within the authority of the archaeologist to permit the second defendant such use of the vehicle. The second thing to mention is that there is an inconsistency in the relief sought in the summons concerning order number 7. That is because paragraph 1 of the summons sought an order that order number 7 be discharged. Yet, as I have said, the summons went on to seek an order that order number 7 be extended for six months. This seemed an internal inconsistency. It is perhaps for that reason that Mr Gillies said that he did not press the order for the continuation of the right to use the motor vehicle. Perhaps it might be speculated that the reason is that if the second defendant was otherwise successful in the application and he resumed as Chief Executive Officer, he might give himself the use of the vehicle.
I referred a moment ago to Ms Goulding. She is the person, or more precisely her company, which was by agreement of the plaintiff and the second defendant appointed as Chief Executive Officer pursuant to paragraph 3 of the orders made in June. The agreement to employ her is in writing dated 1 August 2005. The principal was the council. It engaged Goulding Heritage Consulting Pty Ltd to provide the services of Ms Goulding for a term of three months, which may be extended by written agreement for a further period of up to three months. The commencement date of the contract for services was 1 August 2005.
It is important to note that the agreement provides for early termination, prior to the expiry of the term, on the following grounds, namely: (a) by either party without cause upon giving two weeks’ notice, (b) immediately by either party upon the appointment or election of a new Chief Executive Officer by the council, and (c) immediately by Goulding Heritage Consulting Pty Ltd if Ms Goulding reasonably believes that the orders of Cummins J dated 24 June 2005 have been, or are in imminent threat of being, breached.
Neither party has given two weeks’ notice of termination pursuant to the agreement. Nor have the events occurred which would constitute termination under (b) above, and Ms Goulding has not claimed that the agreement is or has been terminated pursuant to (c) above. Indeed, the period of three months has passed and Ms Goulding is continuing to perform the role of Chief Executive Officer. Doubtless that is for practical reasons, as someone must so act until resolution of the issue before the ’ Court. But it is important that her engagement is not one that follows from an order of the court in the sense that the court order did not put her in that position. All the court did was make a consent order which provided that the plaintiff and the second defendant appoint a person in that position. An engagement has been made in accordance with the order, and the person appointed remains in place, presumably with the agreement of the plaintiff and second defendant. Unless it is further extended, the engagement will end on 31 January 2006.
The application of the second defendant is made on the basis that the investigating accountant has provided a report which is said to have exonerated the second defendant from criticisms of honesty and concerning his behaviour that were made in the affidavits in support of the proceeding. Further, the report established that under his management the council had increased its revenue and improved its financial position. These were new facts which made the continuance of the orders in question unjust and warranted their discharge. See Rocket Records v White[1] and Heike Jindra v Tech-Rentals Pty Ltd[2].
[1][2001] VSC 368 at [8].
[2][2000] VSC 122 at [23].
The second defendant adds an explanation why he consented to the orders made in June, and relies upon an affidavit of the council’s accountant who has deposed to a deteriorating financial position of the council and who contends that the financial position is such that it really cannot afford to pay the expense of the protem Chief Executive Officer, the costs of the ’ Court case and the costs of the investigating accountant. There is also reference to a fall in revenue. It is said that the court should make the orders sought to restore the second defendant to his position and in effect save the council from wasting in the financial sense. The second defendant in addition states that he would heed the advice in the investigating accountant’s report.
In response to those affidavits have been filed some materials, first by the solicitor for the plaintiff, and secondly by Ms Goulding for the council. It may shortly be said that Ms Goulding has put a somewhat different hue and a more optimistic one upon the financial position.
The financial position is a major basis upon which the second defendant has moved for these orders. His application is in effect to strike a line through the orders made in June, up to which time the second defendant had been the Chief Executive Officer, and reinstate him in that position. This is to happen ahead of the resolution of the proceeding in the ’ Court, ahead of clarification as to who is entitled to vote upon the composition of the council and ahead of a council validly constituted determining who ought be the Chief Executive Officer, or any other relevant matter.
It is necessary then to turn to the particular applications that are made by the second defendant. The positive relief sought, apart from the discharging of orders, is that the second defendant by order of the court perform the role of Chief Executive Officer commencing on 1 December 2005 until a special general meeting of the council appoints a Chief Executive Officer. A further necessary order sought is that the contract for services between the council and Goulding Heritage Consulting Pty Ltd dated 1 August 2005 be terminated on 30 November 2005. One only has to reflect upon orders in these terms and compare them with the orders made in June to realise that what the court is now being asked to do is to rewrite the orders made by consent in June.
It is true, as I have mentioned, that liberty to apply was granted, and that the proceeding was adjourned sine die. Except to the extent mentioned already, it seems to me that what was done by these orders was to make final orders in the proceeding, as often occurs in the Practice Court on originating motions, and allow for liberty to apply, which I would read as I have mentioned, and to adjourn the proceeding sine die for a reason which was not specified but which may be presumed to have been to allow for the liberty to apply. At the same time I note that costs were reserved. As I have said, it has not been explained why the orders were in this form but I must take them as they stand on their face.
While order number 3 made in June provided for a person to be appointed to act as Chief Executive Officer, it is not clear to me how the court could now order that the person so appointed, or the engagement of the person so appointed be terminated, whether at any particular date or at all. The appointment was made by the plaintiff and the second defendant, not the court. Once the person was appointed, they were appointed pursuant to an agreement between the parties to which the court naturally enough is not a party, and my attention has not been drawn to any provision in the agreement which reserved to the court a right in any circumstance to terminate the engagement. And, of course, there was no need to reserve any such right as the parties dealt with the matter of termination in the agreement. In light of that specific provision, and the ability of the second defendant to give two weeks’ notice of termination, it seems to me to be a very unusual thing to suggest that a court, independently of any right reserved to it, can override a private agreement between the parties to it let alone to summarily, for reasons attractive to the court, terminate the engagement. If the second defendant wishes the engagement of Ms Goulding’s company to be terminated he has a contractual right which he may pursue if he wishes. It is misconceived to seek to transfer responsibility to the Court in that regard. The parties should be bound by their agreement.
The difficulty for the second defendant may be this. First, if he gives notice of termination pursuant to the right in the agreement he will be at risk of acting in contravention of order number 3 in the June orders. Secondly, if by giving such notice he caused the council to be without a Chief Executive Officer, the plaintiff might move again for the appointment of a receiver and manager. There would also be the added risk of the council being wound up. It is apparent that neither side wants winding up.
In light of these circumstances it may be understood why the second defendant has turned to the court to achieve what he wants pending resolution of the issue in the ’ Court. What he wants is to redo the orders made on 24 June 2005 with the effect that he be reinstated as Chief Executive Officer. That was to happen on the mere establishment of the alleged new facts. I refer below to the fact that the approach of the second defendant seemed to overlook that the plaintiff would have been entitled to revive its summons for interlocutory relief.
The only limitation that was provided for in order number 3 of the June orders was that the appointment be until the council was in a position to convene a special general meeting and make valid resolutions. The sense of that may be understood, that was the basis upon which the parties were to move forward. As it is, as I have mentioned, the employment agreement entered into was entered into for a stipulated period of three months with provision for a further three months, and it would seem that such a period of a further three months is in the course of being enjoyed. But let us suppose, just to complete this part of the exercise, that the court was summarily to terminate the engagement. Is the court to recompense the person retained for the loss of the contract? Surely not. And if the court is not to do so, who is? The whole thing simply does not work. The basic problem is, in my view, that order number 3 in the June orders was a final order which is not reviewable by the court, not able to be recalled on its terms, and I do not understand how the court can simply recall it and make an order of the sort mentioned. There are two problems: firstly, finality of the June order; secondly, inability of the court to summarily deal with a contract made out of court.
The second part of the orders sought is that the second defendant perform the role of Chief Executive Officer. In the circumstances the court could not make that order.
Turning then to the other orders that are sought, I do not see any basis upon which the court could recall order number 6 concerning the registered office; that lies in the province of the Chief Executive Officer under the June orders. The premise of that application is that the second defendant has been reinstated as Chief Executive Officer, That not having occurred, the order should not be made. It would be absurd to change the registered office to his address. Regarding the matters overall, although order number 1, which was the injunction concerned with dealing with assets, may be reviewed because it was made subject to further order, I think in the circumstances that it is not appropriate to change that, certainly not to discharge the order. In effect, what is presented by Mr Gillies is a package, and it would seem to me the package either comes as a whole or it does not. And it follows for the reasons I have given that orders 4 and 5 also should not be altered.
I conclude by noting that if the orders in question had been discharged, on the basis of new facts, it would not have followed that I would simply have made the orders sought by the second defendant. That is because the discharge would have taken the parties back to square one in which event the plaintiff could have moved for interlocutory relief on its original summons. In view of my reasons that exercise has not been necessary but it would have been had I concluded that the orders should be discharged.
The parties are in an unfortunate situation in this case. It is unfortunate that time keeps running by from them. Nevertheless I have come to the conclusion that I have expressed and I can only hope they can press on and get the Magistrates’ Court case concluded. They ought try to seek as much streamlining in that case as possible but for the present the order is that the summons be dismissed. [After discussion the second defendant was ordered to pay the plaintiff’s costs of the application.]
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