Liton v The Bangladesh Association New Zealand Incorporated

[2013] NZHC 1249

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2013-404-1110 [2013] NZHC 1249

BETWEEN  SYED IFTEKHAR UDDIN LITON Plaintiff

ANDTHE BANGLADESH ASSOCIATION NEW ZEALAND INCORPORATED Defendant

Hearing:                   29 May 2013

Counsel:                  F J Peters for the Plaintiff

SRG Judd for the Defendant

Judgment:                29 May 2013

ORAL JUDGMENT OF WOODHOUSE J

LITON v THE BANGLADESH ASSOCIATION NEW ZEALAND INCORPORATED [2013] NZHC 1249 [29

May 2013]

[1]      Mr Liton seeks an interim injunction effectively reinstating him as treasurer of the respondent Association.  He was elected treasurer in May 2012.  As treasurer he is a member of the executive committee of the Association.   The position, in terms of the constitution of the Association, is held for 12 months, expiring on 31

May of each year.  Certainly that is the case in respect of Mr Liton’s election in May of 2012.  In consequence the position Mr Liton was elected to comes to an end in two days time.

[2]      The brief background to the present application and the substantive claim is as follows.  In November 2012 three members of the Association made a complaint to the executive committee – or perhaps to the secretary – about the election in May

2012 of the president. The three complainants said that because of the alleged voting irregularities  the  executive  committee  did  not  have  any  right  to  deal  with  the society’s funds.   I am stating this in general terms but it captures the essence for present purposes.

[3]      Mr Liton decided that in the face of this complaint he should cease to operate the Association’s bank account. Again, I am stating that in rather general terms but it is sufficient.  In particular, he was one of two necessary signatories on all cheques that had to be issued.

[4]      The complaint from the three complainants about the election went to a meeting of the executive committee.  They determined that it was not necessary to take any steps in response to it.  Mr Liton took a different approach.  He advised the executive committee, of which he was a member, that he did not wish to expose himself  to  risk  in  signing  cheques  or  taking  other  steps  as  treasurer  until  the complaint of the three complainants had been sorted out.  Efforts were made to try to resolve  what  can  be  described  as  an  impasse  between  Mr  Liton  and  the  other members of the executive committee, or at least a majority who were wanting him to continue to perform his duties as treasurer.  It is plain enough at least from minutes of the Association that Mr Liton was adamant in the position he had initially taken.  I need not go into the detail but I refer in particular to the minutes of a meeting of the executive committee on 9 December 2012 and a letter Mr Liton wrote to the general secretary of the Association on 12 December 2012.

[5]      The  majority  of  the  executive  committee  treated  Mr  Liton’s  stance  as effective resignation.   The constitution provides, in clause 7, for resignation by a member of the executive committee.  Mr Liton’s advice to the general secretary does not in any express way state that he is resigning and that gives rise to one of the issues that may need to be addressed.  In any event the executive committee, as I say, treated a letter from Mr Liton as amounting to a letter of resignation and in terms of clause 7 the executive committee then accepted the resignation and appointed a new acting treasurer.

[6]      Mr  Liton  then  brought  this  proceeding.    He  initially  applied  ex  parte. Venning J declined the ex parte application on the basis that there was no particular urgency and some orders in any event appeared to be inappropriate for interim relief. I indicated to Mr Peters in the course of his submissions that it was unnecessary to address matters relating to the reasons why the application was brought ex parte. The matter is now proceeding on notice.

[7]      The application in broad terms seeks declarations that Mr Liton is still the lawfully elected treasurer and  that  actions  taken  by the executive committee as indicated in the preceding summary were contrary to the constitution of the Association.  An order is also sought restraining the Association and its servants or agents from removing Mr Liton as treasurer.

[8]      The application is opposed both on the basis that there is not a serious issue to be tried and on the balance of convenience.  There is an affidavit from Mr Liton in support of his application, a reasonably detailed affidavit in opposition from the general secretary, and an affidavit in reply from Mr Liton.

Serious question

[9]      Because of the conclusion I have reached, and which I will come to in a moment, on the balance of convenience, which is against Mr Liton, it is unnecessary to express any opinion on whether there is a serious question to be tried.   And because of the firm conclusion on the balance of convenience it is inappropriate to express any opinion under this heading because Mr Liton may wish to pursue his substantive application for relief.  I should record that the fact that I have refrained

from expressing any opinion should not lead to any inference one way or the other as to what my opinion might be.

Balance of convenience and overall justice

[10]     I will deal together with the balance of convenience and overall justice. These matters in my judgment strongly favour the Association on the question as to whether there should be an interim injunction.  I will simply note these matters.

[11]     The decisive consideration in my judgment is that to make the orders sought at this point would be pointless in large measure.  This is because Mr Liton’s term as treasurer expires, or would expire, in two days.  Coupled with that is the fact that it has been open to him, if he wished to do so, to seek to vindicate the position he has adopted by standing for re-election.   The constitution indicates that new elections would generally take place around about now.  I do not know whether that has in fact happened, but it is a related consideration supporting the primary conclusion that an order would, in effect, be futile.

[12]     There is the fact that Mr Liton chose at least to suspend performance of his duties as treasurer because of the assertions of three only of the members of the Association.  Without expressing any concluded view, having regard to the fact that the substantive claim may continue, it is somewhat difficult to see how this could be justified even if there was some merit in the assertions of the three complainants. The Association contends that Mr Liton was, in effect, holding the executive committee to ransom by declining to perform his duties until the other members of the executive committee dealt with the problem in the manner that Mr Liton thought it should be dealt with them.  I express no opinion on Mr Liton’s motivation.  Mr Liton has indicated, through Mr Peters, that he had concern for his personal liability if he was party to issuing cheques in circumstances where they should not have been issued, which was the contention of the three complainants.  Mr Liton’s motivation may have been completely genuine, but the reality is that, whatever the underlying merit,  the  operations  of  the  Association  in  certain  respects  were  coming  to  a standstill – certainly in relation to the payment of creditors where cheques had to be issued.

[13]     Declining an injunction does not in my judgment, particularly at this date, result in any material injustice to Mr Liton. As I have already indicated, if he wished he could seek to be vindicated for his actions by standing for re-election. Whether or not he has in fact done that, he does have the substantive claim which he can proceed with.  Nothing of any relevance that might otherwise be available to Mr Liton will be lost if the interim injunction application is declined.

[14]     For these reasons the application for an interim injunction is dismissed.

[15]     The Association is entitled to costs.   Mr Judd advised that his instructions were to seek indemnity costs.  I am not persuaded that there is any proper basis for indemnity costs.  Having heard further from Mr Peters on the question I am satisfied that costs should be awarded on a 2B basis with reasonable disbursements.

[16]     There is need for directions for the disposal of the substantive proceeding. Mr Peters has advised that it will assist if he obtains some instructions from Mr Liton as to whether Mr Liton does wish to proceed with the substantive claim.   In this regard, as discussed with Mr Peters, if the substantive claim is to proceed the statement of claim should be amended because it presently contains a substantial amount of evidence which should not be in a statement of claim.

[17]     Consequently there are the following directions:

(a)      If Mr Liton wishes to proceed with his substantive claim an amended statement of claim, setting out the essential contentions but without evidence, is to be filed and served within one month.

(b)A statement of defence should then be filed and served within 14 days of service of the amended statement of claim.

(c)      The proceeding should then be listed for the first case management conference in the usual way with the normal directions applying in that regard.

(d)      If  Mr  Liton  decides  that  he  does  not  wish  to  proceed  with  his

substantive claim then a notice of discontinuance can be filed.

Woodhouse J