Matamu v Si'itia

[2016] NZHC 2516

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2014-404-000170 [2016] NZHC 2516

In the matter

of the Avondale Union Parish

BETWEEN

TUIʼIMALO MATAMU, TALAOALIʼI NASERI, MALIELEGAOI AUMUA, SAENI PITA AND TOFA TOFIA TOFA Plaintiffs

AND

VAʼAIMALU SIʼITIA, MARY MCEWING, REV ALISA LASI, REV ROY CHRISTIAN, FORBES WORN AND SALAPO RAPITI TUIA

First Defendants

AND

THE PREBYSTERIAN CHURCH PROPERTY TRUSTEES

Second Defendants

Hearing:	7 June to 10 June 2016
Appearances:	Olinda Woodroffe and Jeffrey Ussher for the Plaintiffs Richard Pidgeon for the First, Second, Third and Sixth Named First Defendants Katie Hogan for the Fourth and Fifth Named First Defendants
Judgment:	21 October 2016

JUDGMENT OF MOORE J

This judgment was delivered by me on 21 October 2016 at 4:30 pm pursuant to Rule 11.5 of the High Court Rules.

Registrar/ Deputy Registrar

Date:

MATAMU & ORS v SIʼITIA & ORS [2016] NZHC 2516 [21 October 2016]

Contents

Paragraph Number

Introduction ..............................................................................................................[1] History and background

History and formation of Avondale Parish Union ..................................................[7]

The Samoan congregation ....................................................................................[13] The Pacific Island Synod and Rev Amosa ...........................................................[17] White Sunday and its aftermath ...........................................................................[25] Finances of the AUP.............................................................................................[37] The meeting of 5 December 2013 ........................................................................[46] Procedural history ................................................................................................[57] Present position ....................................................................................................[62] Causes of action and relief sought ........................................................................[64] Jurisdiction to grant declaratory relief ................................................................[68]

What are the applicable rules which apply to Co-operative Ventures?

The rules ...............................................................................................................[76] Breach of Contract .................................................................................................[88] Is there an enforceable contract between the parties? ..........................................[89] Was there a breach? ..............................................................................................[97]

Were the members of the plaintiffs’ group part of the AUP as at

5 December 2013 or had they repudiated their membership?.......................[104] The law on repudiation.......................................................................................[106] Is the test for repudiation met on the evidence?.................................................[107]

Decision on repudiation and reasons .................................................................. [110] (i)      Declaration a new church formed ............................................................ [111] (ii)     Continuation of Rev Amosa’s ministry ................................................... [118] (iii)    Separate organisational structure.............................................................[121] (iv)    Financial independence and lack of contributions to AUP .....................[133] (v)      Non-attendance at Parish Council meetings ............................................[139] (vi)    Discipline and respect for chain of command .........................................[142] (vii)   The plaintiffs’ arguments that they had not been removed from

the AUP’s membership roll in accordance with the Book of Order ........[148]

Conclusion on repudiation ..................................................................................[151] Breach of trust ......................................................................................................[154] Breach of fiduciary duties ...................................................................................[162] Result .....................................................................................................................[166] Costs ......................................................................................................................[167]

Introduction

[1]      This case represents the culmination of a bitter and longstanding dispute between elements of the Samoan congregation of the Avondale United Parish (“AUP”) and the balance of the congregation.

[2]      The dispute centres on the status and property rights of the group represented by the plaintiffs, who have expressed a desire to form a new church.

[3]      Following several years of rising tension within the AUP, its Parish Council

voted to disallow the plaintiffs’ group1 the future use of the premises.

[4]      The plaintiffs seek declarations that the meeting of the Parish Council at which this vote was taken was not properly notified and improperly constituted with the consequence the motions were invalid.

[5]      The determination of this question focuses on whether, in fact, the plaintiffs’ group were members of the AUP at the time of the Parish Council’s vote or whether they had effectively left the AUP.

[6]      For the purposes of this judgment, the use of the term “defendant(s)” may be

interpreted as a reference to the first, second, third and sixth named first defendants.2

1      The expression “plaintiffs’ group” is explained more fully later in this judgment.  For present purposes it suffices as a collective term to describe the plaintiffs and the wider group they represent.

2      I note that an application to strike out the fourth and fifth first named defendants was filed and that orders were made by Muir J that it would be heard at the beginning of the hearing.  I heard submissions but given the late nature of the application and the fact that I would be hearing evidence as to the substantive liability of the parties, I declined to make orders. With the benefit

of hindsight, had the application been made at an earlier stage, I would have granted it owing to

the fact that the fourth and fifth named first defendants played no role at the meetings in question;   it is also noted that settlement has been reached as between the plaintiffs and the second  defendants.    The  plaintiffs have  agreed  not  to  proceed  further  against  the  second defendants and the second defendants have agreed to abide any Court orders as between the plaintiffs and the first defendants. No costs orders are sought as between these parties.

History and background

History and formation of Avondale Parish Union

[7]      For a very substantial period St Ninians Presbyterian Church was the only church  in  the Avondale  region.    From  well  before  the  turn  of  the  last  century Christians who wished to worship either attended the service at St Ninians, met informally or travelled considerable distances to attend churches of their own denominations.

[8]      As the city of Auckland grew, the non-Presbyterian denominations in the Avondale and West Auckland areas withdrew from St Ninians and established their own churches; first the Anglicans and later the Methodists.

[9]      However, an increase in ecumenicalism in the 1960s and 1970s saw many churches return to the earlier co-operative model, including those in the Avondale and West Auckland areas.   This broadly coincided with large numbers of Pacific Island families, mostly from Samoa, immigrating to New Zealand.  Many settled in West Auckland.   As a consequence the Pacific Island congregation of St Ninians grew, particularly the Samoan component.

[10]     In Avondale the increase in ecumenicalism was formalised in 1972 when the AUP was established with several Presbyterian and Methodist congregations uniting. The unification model, which is discussed in more detail later in this judgment, permits churches of different denominations to join as a single, unified congregation. In the AUP the constituent, founding churches and congregations were St Ninians, the Methodist  Church  at  Rosebank  Road,  the Waterview Methodist  Church  and

Victoria Hall.3

3      Some years later the Waterview Methodist Church withdrew from the union.

[11]     The agreement establishing the AUP defined the boundaries of the Parish, its constitution and membership, its governance, the number and appointment of Ministers, property and finance, and the joint use of buildings.  As for the last of these, the buildings included the Avondale Methodist Church and the land owned by it, the Waterview Methodist Church, the St Ninians Church Hall and manse and the Victoria Hall, including land and houses.

[12]     Under  the AUP,  although  individual  members  of  the  congregation  might affiliate as Presbyterian or Methodist, each is part of a single, unified congregation known as the AUP.  Denominationally, the Ministers appointed to the AUP alternate term by term.

The Samoan congregation

[13]     The main decision-making and governing body of the AUP is the Parish Council.   It is the Parish Council which “manages the life and resources” of the church.4  Those elected to the Parish Council must be members of the church.

[14]     Initially the Parish Council consisted of the Minister and 10 representatives drawn equally from the Presbyterian and Methodist members of the congregation. However, as the Pacific Island membership of the AUP grew, there was a call for that constituent group to have its own Minister.  In 1979 this aspiration was realised in an agreement which recognised that the Pacific Island community had become an integral part of the Parish.   As a consequence it was resolved that the Rev H C Pomeroy and the Rev L Si’itia would both be appointed as full-time Ministers of the AUP working together in what was described as a “Team Ministry … as a team, both of equal status and, exercising the fullest possible ministry … to all members of the

Parish.”5

[15]     An arrangement was then implemented which led to two services being held

for the AUP’s congregation each Sunday; an 11:00 am for the English speaking fellowship (“ESF”) and a later service for the Samoan speaking fellowship (“SSF”).

4      Rule 3.2.1 of the Procedures for Co-operative Ventures of the United Congregations of Aotearoa

New Zealand.

5      Team Ministry Agreement dated 1 May 1979, signed by the AUP Session Clerk, the Samoan

Secretary and both AUP Ministers.

Although the two services were primarily organised along language lines some from the ESF would attend the afternoon service and vice versa.  The Ministers tended to alternate between the services.   Although there was a broad and largely informal delineation  within  the AUP congregation  based  on  language,  the  ESF  included parishioners from both the Presbyterian and Methodist denominations while the SSF primarily  identified  as  Presbyterian.    Members  of  the  congregation  from  other Pacific Island communities were welcome at either service although they were fewer in number than the Samoan parishioners and tended to worship with the ESF.  This arrangement of separate morning services appears to have operated well; co- operatively and without any evident tension or difficulties.

[16]     From 1986 it was agreed that the membership of the Parish Council should reflect both the English speaking and Samoan speaking elements of the AUP congregation.   It was thus decided that the 10 seats formerly reserved in equal numbers for the Presbyterian and Methodist members of the congregation should be reduced to five with an equivalent number drawn from the SSF.

The Pacific Island Synod and Rev Amosa

[17]     In 2003 Rev Si’itia’s term as the SSF’s Minister ended.  Rev Asora Amosa was inducted as his replacement.  On the evidence it is apparent that Rev Amosa’s 10 year ministry had a polarising effect in the AUP both within the SSF and the ESF.

[18]     As will be discussed more fully later, the appointment of Ministers to a united parish is prescribed by the rules and principles promulgated by the governing body for united parishes, the Uniting Congregations of Aotearoa New Zealand (“UCANZ”).  The rules are contained in the Procedures for Co-operative Ventures

2012 (“PCV”).6    Rev Amosa’s letter of appointment recorded his tenure was for an

initial term of eight years beginning 31 July 2003.  The appointment was made by the Presbytery of Auckland.7   It was signed by Rev Amosa and countersigned by the Presbytery Clerk for the AUP, the Chairperson for the Joint Regional Committee and

by representatives of the two partner churches being the Methodist Synod and the

6      In 2013, when Rev Amosa was appointed, the applicable rules were those contained in the Guide to Procedures (2001).  These were replaced in 2012 by the PCV (as approved by the Forum of Co-operative Forums).

7      Later this name was changed to the Northern Presbytery.

Moderator of the Auckland Presbytery.    However, the maximum period a Presbyterian Minister may hold office is eight years with a possible extension of two years.8   At the end of Rev Amosa’s second four year term in 2011 he was granted a further two year extension.   It was inevitable that his ministry had to end at the conclusion of this extension.  The rules are explicit.  No term for any Minister may exceed 10 years.

[19]     On 8 March 2006 the Aoga Amata Pacific Island Church Avondale Trust (“APICA”) was established by Rev Amosa as a vehicle to receive funds from the SSF for what the trust deed described as the benefit of “the Pacific Island Church Avondale, known as the Samoan Fellowship of the Avondale Union Parish”.

[20]     On 6 October 2012 the national governing body of the Presbyterian Church of Aotearoa New Zealand (“PCANZ”) created the Pacific Islanders’ Synod (“PI Synod”).  This initiative reflected PCANZ’s response for the need to recognise and meet   the   spiritual   requirements   of   Pacific   Island   congregations   within   the Presbyterian Church.  The new synod enjoyed the same status and powers of a self- governing and self-managing Presbytery but without its territorial boundaries.  As a consequence the PCANZ’s rule book, the Book of Order, was amended to reflect this initiative.   The Book  of Order also provided that a parish’s congregation could resolve to leave its governing Presbytery and elect, instead, to be governed by the PI Synod.   However, a special majority of at least two thirds of the members of the whole parish was required to vote in favour of joining the PI Synod before such a

move was authorised.9

[21]     In  March  2013  the Parish  Council  consisted  of two  ministers, Rev Alisa

Lasi10 and Rev Amosa and five representatives from each of the fellowships.  Those representing the SSF were Talaoali’i Naseri,11  Leaupepe Matamu,12  Silipi Auva’a,

8      This is pursuant to rules 212(5) and (7) of Appendix F-5 of the Common Provisions for Co- operative Ventures, issued by the Presbyterian Church of New Zealand.

9      Book of Order, rule 13.4(1).

10     Rev Alisa Lasi is the third named first defendant.  She is currently the Methodist Minister of the

AUP.

11     The second named plaintiff.

12     Now deceased.

Michael Tuiletufuga and Va’aimalu Si’itia13.  The five representatives from the ESF were Salapo Tuia,14 Susana Maiama (neé Lesatele), Perelini Crichton, Toleafoa Maiama and Mary McEwing.15

[22]     On 16 June 2013 a meeting of the AUP was called for the purpose of taking a ballot to consider joining the PI Synod.  This was undertaken at the request of certain members of the SSF.  The evidence indicates this move was influenced, if not driven, by Rev Amosa whose term as Minister was due to expire the following month.  At the time, in addition to his duties as a parish Minister, he also held office as the PI Synod clerk.  Witnesses for the defendants’ group described Rev Amosa as holding an agenda (to have the SSF join the PI Synod), and of exhibiting a “personality- driven leadership” style.   It was said he “carefully sowed the seeds of discontent within the AUP’s SSF to gain support [to join] the PI Synod”.  By a considerable

margin the vote in favour of a transfer failed.16    Despite losing the vote it appears

that Rev Amosa called for another vote which also failed.  Although these issues are incidental to the primary questions engaged in these proceedings, they provide a contextual background for what then happened in the Parish over the following months as tensions rose within the SSF and the lines of opposition began to form.

[23]     Of particular significance, and no doubt adding to the rising tensions, was the conclusion of Rev Amosa’s 10 year ministry on 31 July 2013.  This was a source of considerable  dismay  and  resentment  on  the  part  of  some  within  the  SSF. Exacerbating these concerns was an erroneous belief held by many of his supporters that the Northern Presbytery had somehow intervened and wrongly dismissed Rev Amosa who, but for the Presbytery’s premature intervention, would have remained in his Ministry until he elected to retire.   This view ignored the reality that the termination of Rev Amosa’s ministry was governed by the operation of his letter of appointment  and  Appendix  F-5  of  the  Common  Provisions  for  Co-Operative Ventures issued by the Presbyterian Church. Vitriolic and abusive correspondence directed at the Northern Presbytery from some of Rev Amosa’s supporters reinforces

the conclusion that there was a widespread misapprehension within the SSF that

13     First named first defendant.

14     Sixth named first defendant.

15     Second named first defendant and Parish Secretary.

16     The motion, which required a special majority of two thirds to pass, was lost 71 to 41.

Rev Amosa’s term had been wrongly and prematurely terminated at the will of the

Presbyterian leadership.

[24]     If these events were not the catalyst for what happened later, they certainly contributed substantially to a rapidly growing sense of frustration and alienation within some elements of the SSF.   It is also apparent that despite Rev Amosa’s ministry terminating he remained a visible, vocal and influential figure within the SSF of the AUP.

White Sunday and its aftermath

[25]     Matters came to  a  head  on  Sunday,  13  October 2013.   This  was White Sunday, an important event on the AUP’s calendar.   It is a day when the Pacific Island community dresses in white and gathers to acknowledge and celebrate childhood. According to several witnesses attempts were made by some from within the SSF to frustrate or otherwise prevent White Sunday from taking place that year. However, if there were such attempts, they failed.   On this particular Sunday the assumption of many was that the usual convention of two morning services would continue.  At the SSF’s 11:30 am service it was expected that Rev Alisa Lasi, the AUP’s Methodist Minister, would share a joint service with Rev Maafala Koko, who the Northern Presbytery had appointed on Rev Amosa’s retirement as the interim moderator for the SSF pending the election of a new Minister.  However, Rev Koko apparently excused himself leaving Rev Lasi to conduct the service on her own.

[26]     Following the service, members of the SSF congregation retired to the church hall for lunch.  However, several noticed a group of Rev Amosa’s supporters, who had not attended the morning service, enter the church.  They decided to investigate. They entered the church to find a service being conducted by Rev Koko, Rev Amosa

and the leader of the PI Synod.  Mr Malielegaoi Aumua17, a senior member of the

SSF, addressed the congregation.   According to one witness, he said this was a special day for their forefathers, one which they had prayed and dreamt for; to establish  an  independent  PIC Avondale  Church.    Other  witnesses  described  the

congregation being congratulated for starting the new church.  There then followed a

17     The third named plaintiff.

discussion about fundraising for the new enterprise during which a list of donors’ names was read out together with the contributions they had made towards the establishment of the new church.  Amongst the donors named were Rev Amosa and his wife who had made a contribution of $10,000.

[27]     This service appears to have been the first of what is now a regular service which takes place at 3:00 pm every Sunday afternoon.  The congregation, claimed by the plaintiffs to number 317,18 were formerly members of the SSF who now seek to worship separately and who are represented by the plaintiffs.  In the course of the hearing and for the purposes of this judgment they will be referred to as the “plaintiffs’  group”  while  the  balance  of  the  SSF  will  be  referred  to  as  the “defendants’ group”.19

[28]     At the morning service on the following Sunday, 20 October 2013, Rev Koko led the SSF service at the usual time of 11:30 am.   One of the purposes of that service was to elect a new Minister for the SSF.  However, due to dissention within the congregation arising from the events of White Sunday, particularly the claim a new church had been established, no ballot was taken.

[29]     On 23 October 2013 Rev Lasi called a meeting of the SSF.   Notice of the meeting was given in the usual way, that is through advice in the Parish notices and by making an announcement during the course of the service.  The purpose of the meeting was to elect new SSF Parish councillors to replace those who had joined the plaintiffs’ group, and were therefore considered to have left the AUP.  As a result, Talaoali’i Naseri, Silipi Auva’a and Michael Tuiletufuga were replaced by Susana Maiama, Perelini Crichton and Namulauulu Falevaa, all of whom were connected

with the defendants’ group.20    In practice, this change removed any representation

the plaintiffs’ group had hitherto had on the Parish Council.  It is accepted that the

18     This is a figure which was mentioned several times in the course of the evidence and in some of the correspondence connected to the plaintiffs’ group. The defendants’ group claims that its own composition is in excess of 280 members.  No reliable evidence in support of either figure was adduced.

19     The apellation “defendants’ group” is inapt to the extent it may suggest Rev Christian and

Mr Worn were part of it. They were not.

20     This changed the composition of the Parish Council such that Salapo Tuia, Va’aimalu Si’itia, Susana Maiama, Perelini Crichton and Namulauulu Falevaai represented the SSF and Mary McEwing, Emi Kamuta, Fa’amao Ula, Pam Anderton and Elizabeth Stuart represented the ESF.

three departing Parish Council members were not given specific notice of this meeting.  Also on 23 October 2013 Salapo Tuia, as the new AUP Secretary, wrote to the moderator of the Northern Presbytery.  He described the anguish, pain and grief caused by the fractures within the Samoan congregation of the AUP.  He was fiercely critical of the interim moderator, Rev Koko, who he blamed for failing to manage the crisis effectively.  More particularly, he claimed that Rev Koko had advised that the Presbytery had  “okayed  …  the  breakaway  group”.    He  sought  confirmation  of Rev Koko’s claim that the Northern Presbytery had authorised the establishment of the Pacific Island Church (PIC) Avondale within the AUP and exhorted the Presbytery to act urgently to prevent the conflict from escalating.

[30]     It is not apparent from the evidence whether Mr Tuia’s letter received a written reply, but it would appear the hierarchy of the partner churches responded to it because six days later, on 29 October 2013, a meeting of leading figures from the Northern Presbytery, Methodist Church and UCANZ was called.  These included the moderator of the Northern Presbytery, Rev Roy Christian.  While the minutes of that meeting  do  not  make  it  clear  who  from  the AUP  attended,  Rev Christian  was recorded as advising that the purpose of the meeting was to receive and consider the community’s  concerns.     Presumably  in  response  to  Mr  Tuia’s  reference  to Rev Koko’s claims, Rev Christian advised the meeting that Rev Lasi was the AUP’s Minister and that Rev Asora was no longer a Minister of the AUP.  Rev Koko had been appointed as interim moderator.

[31]     On 30 October 2013 the newly elected Parish Council met.  With Rev Lasi in the chair,  those  attending included  Rev Tupou  (a newly appointed  probationary Minister),  Mesdames Anderton,  Crichton,  Kamuta,  Maiama,  Stuart,  Ula,  Messrs Aukuso, Naseri, Pita, Selu Si’itia, Tuia Savaiinaea and Namulauulu Falevaai.  Other members of the AUP were also in attendance.  Of note, Mr Naseri attended although the minutes are silent as to his participation, if any.

[32]     On 20 November 2013 a meeting appears to have taken place between the Northern Presbytery, representatives of the Forum of Co-operative Ventures and members of the plaintiffs’ group.  Presumably written in anticipation of this meeting is a letter dated 20 November 2013 authored by officers of what was described as the

Pacific Island Church Avondale addressed to the Moderator and the Chair of the Forum of Co-operative Ventures.  The letter purported to be written on behalf of a group described by the authors as:

“… 73 percent of the former Samoan fellowship of the Avondale Union

Parish.”

[33]     The letter referred to the group’s “mau” which, roughly translated, apparently

means proposal or mission.  It made two requests:

(a)      that the group be formally recognised, constituted and established as the Pacific Island Church Avondale within the premises of the AUP; and

(b)the PIC Avondale would be governed by the Presbyterian Church and working under the Pacific Island Synod.

[34]     The letter referred back to both the termination of Rev Amosa’s term and the circumstances  which  led  to  the Parish  voting  against  joining  the  PI Synod.    It expressed a strong preference to continue to use the church facilities but as a separate and identifiable congregation.

[35]     Of significance is the manner in which the letter was signed off.  There were four signatories.  Beside the name of each was the role or office that person claimed to hold within the plaintiffs’ group.   These were Tui’imalo Matamu as Chairman, Talaoaliʼi Naseri as Treasurer, Malielegaoi Aumua as Secretary and Tofa Tofa as a member of the committee.21

[36]     It is apparent that what the authors of the letter were seeking was to establish themselves as a separate congregation operating under the oversight and superintendence of the PI Synod rather than the Northern Presbytery.  In other words they sought the same result which they had failed to achieve in the ballot of 16 June

2013 when the Parish voted on the issue of joining the PI Synod and the motion was

defeated.

21     There was no signature adjacent to Tofa Tofa’s name.

Finances of the AUP

[37]     Of growing concern to those governing the AUP was the Parish’s ability to meet its operating expenses as they fell due.   Since August 2013 the SSF’s usual contributions to the Parish’s finances had been suspended.  As a consequence, the Parish was placed under considerable financial stress.  As already noted, the trusts operated by the respective partner  churches owned the properties.   The income derived from those assets and the responsibility for meeting the running and maintenance costs of the buildings and other assets lay with the Parish Council.  The usual sources of income, being monies received from carparking rentals, rent from the use of church buildings and the rent for the pre-school were all paid into accounts operated by the SSF.

[38]     It was the task of Ms McEwing, the Secretary to the Parish Council, to monitor and ensure the timely payment of the Parish’s costs.   These included the UCANZ levy ($12,300), PCANZ and Methodist levies, insurance premiums ($19,600), utilities, telephone, etc.

[39]     In the past an informal agreement appears to have operated within the AUP, with the SSF and ESF meeting the expenses according to settled ratios.  Traditionally the SSF had met the costs of electricity and water.  They also assumed responsibility for the maintenance of the church centre.  The ESF was generally responsible for the maintenance of some of the other properties.

[40]     On a pro-rata basis calculated according to the number of members within each fellowship, the SSF and the ESF, paid a monthly amount into the AUP’s joint general account from which the Parish’s accounts were paid.   It appears that the division of responsibility for meeting these costs as they fell due was one which had worked well in the past.

[41]     The SSF operated a significant number of accounts.  Income included carpark rentals, rentals from APICA, gifts and tithes. There were three authorised signatories for  the  operation  of  these  accounts.    In  August  2013  these  were  Mr  Naseri, Mr Salapo Tuia and Mr Mailata Su’a.  Any withdrawal from these accounts required at least two signatures.

[42]     In or about August 2013 Mr Naseri approached Mr Tuia and requested that he sign an account signatory authorisation form to remove Mr Su’a as an authorised signatory and replace him with Mr Aumua.  Mr Tuia, whose grasp of English and understanding of business matters is limited, said he signed the form because he trusted Mr Naseri.   Up until that time he and Mr Naseri had been senior officers within the SSF and both had been strong and vocal critics of Rev Amosa. According to  Mr Tuia,  the week  after Mr Naseri  obtained  Mr Tuia’s  signature  Mr Naseri “changed sides” and joined the plaintiffs’ group.

[43]     Mr Naseri denied any subterfuge or dishonest conduct in relation to this transaction.  He said the removal of Mr Su’a as a signatory and replacing him with Mr Aumua was because Mr Su’a had been removed as Vice Secretary at the May Annual General Meeting.   While I am not required to decide this issue the consequence  of  Mr Naseri  and  Mr  Aumua  being  authorised  signatories  of  the accounts is that the plaintiffs’ group has been able to control the accounts formerly operated  by  the  SSF.      Significantly  the   funds   in   these  accounts   included contributions made by the wider SSF which included members from both the plaintiffs’ and defendants’ groups.  Any suggestion the funds in these accounts were derived solely from the generosity of the plaintiffs’ group is misleading.  The funds represent the cumulative efforts and generosity of the whole of the SSF.

[44]     Over the period since the plaintiffs’ group has controlled these accounts some

$70,000 has been withdrawn for unknown purposes and with the exception of a limited number of automatic payments the SSF has made no contribution to the AUP’s joint general account with the consequence the ESF has carried the burden of meeting the liabilities for the whole of the AUP including the payment of substantial insurance and levy payments.

[45]     On 19 June 2014 the defendants’ group obtained freezing orders over SSF’s

accounts which have not been operated since.

The meeting of 5 December 2013

[46]     On 5 December 2013 the Parish Council met.  It is this meeting which lies at the heart of these proceedings because it was then the Parish Council purported to

pass the resolution denying the plaintiffs’ group future use of the Parish’s premises.

It is that resolution which the plaintiffs’ group now challenges.

[47]     Meetings of the Parish Council were not generally notified in writing because they occurred regularly every second Tuesday of the month.  However, this was not a regular monthly Parish Council meeting.  Notice was given from the pulpit and in Parish notices.  It is common ground that notice of this meeting was not received by any of those within the plaintiffs’ group.  None from the plaintiffs’ group attended. Present at the meeting was Rev Lasi.  She invited Rev Tupou to attend because the meeting  involved  the  Parish  of  which  he  was  a  probationary  Presbyter.    Also attending by invitation were Rev Christian and Mr Forbes Worn who was the project manager of the Northern Presbytery with particular skills and experience in management, organisational change and finances.  Rev Koko was not included.

[48]     The five representative members from the ESP and the five newly appointed members from the SSF attended.

[49]     Rev Christian was invited to the meeting to act as a facilitator and to chair the meeting in his capacity as Moderator of the Northern Presbytery.  He viewed his role as a facilitator and a steward of the AUP.  The uncontradicted evidence is that neither he nor Mr Worn voted.22

[50]     Two   sets   of   minutes,   completed   by   different   authors,   recorded   the discussions.23   The meeting commenced with a prayer after which Mr Worn set out the  position  as  understood  by  the  Northern  Presbytery  and,  in  particular  the following:

(a)       The AUP is the legal entity which occupies the building.  The Parish

Council is its governing body.

22     Although the plaintiffs’ group claim Rev Christian and Mr Worn voted there is no evidence to contradict the evidence of both men they did not vote.  Their evidence on this point is supported by others who attended this meeting and confirm neither Rev Christian nor Mr Worn voted.

23     One set of minutes were written by Mr Worn and the other by Mrs Crichton.

(b)The SSF appears to have broken into two parts with one desiring to remain a part of the AUP and the other separating itself from the Parish and Presbytery with only a small chance, at best, of reconciliation.

(c)       The AUP needs all of the SSF.

(d)      Some families have been split between the two groups.

(e)      If both groups were to remain at the AUP there would need to be a Memorandum of Understanding drawn up and supervised by the Auckland Regional Forum, the Methodist Synod and the Northern Presbytery.

[51]     Following these comments a lengthy discussion followed.  The reference in the minutes to the plaintiffs’ group separating itself from the AUP and there being little or no chance of reconciliation reflected statements made by Rev Christian who reported on his meetings with the plaintiffs’ group and what they had told him. These meetings are discussed more fully later in this judgment.   Against that background the Parish Council considered its options. The Parish Council concluded that such was the level of friction and distrust between the two groups that continued contact within the AUP and its facilities was neither a viable nor safe option.  The tension within the Parish had become intolerable.  Serious health and safety issues were in play given the levels of mistrust and animosity.   There was no realistic prospect for peaceful worship in the future and the situation would not be resolved by the plaintiffs’ group remaining on the premises even as tenants.

[52]     Also discussed were the Parish’s finances as earlier noted.  The strangle-hold the plaintiffs’ group exercised over the SSF’s finances had created an intolerable and crippling burden on the AUP.

[53]     Accordingly, the following motions were put to the meeting and passed:

(a)      “The [Parish] Council of the AUP will not allow future use of their premises by the separating Samoan group.”  This motion was carried

10 to 1 with Rev Tupou voting against.

(b)“Rev Lasi and the Parish Council Secretary be appointed to determine the use of the facilities meantime, with the final service of the separating Samoan speaking fellowship on 26 January and the buildings be vacated by Saturday, 1 February.”  The minutes are silent on the voting for this motion.

[54]     The AUP then wrote to Messrs Matamu, Aumua, Naseri and Tofa advising

them of the AUP’s resolutions of 5 December 2013. Two days later, on 11 December

2013,  the  plaintiffs’ group’s  solicitors  wrote  to  the  Executive  Secretary  of  the Assembly of the Presbyterian Church and copied in the Northern Presbytery.  The letter commenced as follows:

“We advise that we have been instructed to act for the members of the Avondale PIC Samoan group.  We understand that the Avondale Church is a Union church.

We are instructed that there is discord amongst the Union Parish members, over issues affecting the rights of the majority of the Samoan members and in particular the decision not to extend the appointment of Rev Asora Amosa as the church Minister of the Avondale PIC Samoan group.

…

We are instructed by our clients to seek a dissolution of the current co- operative venture.   Our client’s members wish to formally apply for recognition as a new Congregation pursuant to the PCANZ Book of Order. Our clients wish to enter into a Joint  use Agreement for the use of the Church buildings and assets.  Most of our clients contributed to the building and the maintenance of the church facilities over many years.   We would appreciate hearing the initial views of the Church in regards the request for a dissolution of the current co-operative venture and advice whether PCANZ are receptive to an Application by our clients to form its own Congregation, that  enters  into  a  Joint  Use Agreement  with  the  Methodist  part  or  any remaining parts of the current Union Parish.”

[55]     Some   days   later   the   Northern   Presbytery   established   a   Presbytery Commission for the purpose of investigating all property and financial matters relevant to the AUP, the SSF and associated trusts.

[56]     There then followed an email from the Presbytery office to Mr Naseri, as Treasurer of the plaintiffs’ group, advising of the establishment of the Commission. This correspondence provoked a most abusive email from Mr Naseri who warned the Presbytery not to “dip [its’] nose in areas [it knows] nothing about.”  He said he would not respond to any queries relating to the group’s financial circumstances adding the advice that the account in question was under the control of the Pacific Island Church Avondale and that the AUP had had no share at all in it, noting he “… had enough of idiots like you who would exploit our people.”   He claimed that despite sending numerous emails to the Presbytery he had not received any answers.

Procedural history

[57]     On 31 January 2014 the plaintiffs’ group applied, on a without notice basis, for an interim injunction.  This came before Courtney J who granted the application and made orders that the plaintiffs’ group were permitted to continue to use the church  property  for  the  purposes  of  their  services  and  activities  at  the  times nominated in the order including Sundays from 3:00 pm.24   The orders also included a direction that the plaintiffs’ group be provided with a set of keys to the church property and a further order that the defendants’ group not change the locks of the church without the knowledge and consent of the plaintiffs’ group.

[58]     As earlier noted, on 19 June 2014 the defendants’ group applied for and obtained  a  freezing  order  in  relation  to  a  series  of  nominated  bank  accounts belonging to the AUP but controlled by the plaintiffs’ group which, it was alleged, had withdrawn funds to the exclusion of the defendants’ group.

[59]     On 1 August 2014 the freezing orders were extended and the periods of

access by the plaintiffs’ group varied.25

24     Matamu v Si'itia [2014] NZHC 34.

25     Matamu v Si'itia CIV-2014-404-000170, 1 August 2014 per Thomas J.

[60]     The substantive hearing of this matter was scheduled to be heard before Duffy J on 19 May 2015.  However, in the course of the hearing the parties agreed that the appropriate course would be for the Court to issue an interim decision recording the issues for determination at trial.   Timetabling orders would then be made to permit the plaintiffs to amend pleadings and file any additional evidence.

[61]     The central issue before Duffy J was whether notice of the Parish Council meeting of 5 December 2013 was required and, secondly, whether the plaintiffs’ group were entitled to notice.26    Following an exchange between the bench and the bar, counsel for the defendants accepted that no notice of the meeting had been given to those identified by the plaintiffs’ group as deserving of notice.  As a consequence, the sole, remaining issue for determination at trial was whether the persons the plaintiffs’ group claim were entitled to notice were, in fact, members of the Parish

Council at that time.  In other words, as at 5 December 2013, were those who the plaintiffs’ group assert were still members of the Parish Council in fact members of the Parish Council.   If so, the first defendants accept that these members were, in principle, entitled to notice.  If not, they would not have been entitled to notice and the resolutions passed on 5 December 2013 were thus lawful and enforceable.

Present position

[62]     At present there are now three services each Sunday; the ESF at 9:30 am, the SSF at 11:00 am and the plaintiffs’ group at 3:00 pm.   Rev Amosa is involved in taking the afternoon service for the plaintiffs’ group.

[63]     Attempts   at   reconciliation   between   the   groups   have   failed   including mediation.   Judges of this Court involved in the various phases of litigation have appealed to the parties to settle their differences in an attempt to reach an accommodation.   However, all efforts at resolving this dispute, which has divided friends and families, have failed.  The unfortunate and undesirable consequence is that it is now necessary for this Court to decide a dispute between elements of a community which until three years ago had been a happy and co-operative unit the

members  of  which  shared  their  religious  needs  and  social  lives  with  the AUP

representing the community’s spiritual epicentre.

Causes of action and relief sought

[64]     The plaintiffs’ case rests on two interconnected claims.  The first is that the Parish Council meeting of 23 October 2013 was improperly constituted and notified. This  meeting  resulted  in  Susana  Maiama,  Perelini  Crichton  and  Namulauulu Falevaai  (allied  with  the  defendants’ group)  being  elected  to  replace  Talaoali’i Naseri, Silipi Auva’a and Michael Tuiletufuga (allied with the plaintiffs’ group) as representatives of the SSF on the Parish Council.   The plaintiffs allege this contravened the PCV because Parish Council members may only be elected at an Annual Meeting of the AUP.   They claim the former SSF members of the Parish Council had not left the AUP.   They thus remained the legitimate elected Parish councillors.

[65]     The plaintiffs claim that, as a result, the motions passed at the Parish Council meeting of 5 December 2013 were null and void.  Susana Maiama, Perelini Crichton and Namulauulu Falevaai were not valid representatives of the SSF and were not entitled  to  vote  in  this  capacity.    Talaoali’i  Naseri,  Silipi Auva’a  and  Michael Tuiletufuga remained the valid appointees and were entitled to receive notice of and vote at this meeting.  It is accepted that they were not provided notice.

[66]     The plaintiffs plead three causes of action:

(a)       First,  by  passing  the  motions  in  the  manner  that  they  did  on

5 December, the first defendants breached their duties as trustees of the church property.

(b)Secondly, by voting on the motions at the meeting of 5 December, the first defendants breached their fiduciary duties to the plaintiffs in a number of ways.

(c)      Thirdly, by allowing persons who were not validly elected members of the Parish Council to vote on 5 December and failing to provide

notice of this meeting to the former SSF representatives the first defendants breached PCANZ’s Book of Order, the Laws and Regulations of the Methodist Church of New Zealand and/or the PCV, all of which have contractual force as between the parties.

[67]     In respect of all three causes of action, the plaintiffs seek the same form of declaratory relief. This is described in the Fourth Amended Statement of Claim as:

“(a)      A declaration that the Plaintiffs were represented on the AUP Parish Council as at 5 December 201[3], by Talaoali’i Naseri, Silipa Auva’a and Michael Tuiletufuga, who were not given notice of, nor present at the Parish Council meeting of 5 December 201[3].

(b)       A  declaration  that  plaintiffs  representatives  on  the  AUP  Parish Council, Talaoali’i Naseri, Silipa Auva’a and Michael Tuiletufuga who remain members of the AUP are entitled to be notified, participate and vote as full members of the AUP Parish Council.

(c)       A declaration that the motions of the 5 December meeting purporting to evict and lock out the plaintiffs and the PIC Avondale from the church properties of AUP, are unlawful and in breach of trust.

(d)       A declaration that any purported appointments to the Parish Council made on the 23 October 2013 and/or any other time, without knowledge, consent and presence of the AUP Parish Council members of the plaintiffs, are invalid and of no effect.”

Jurisdiction to grant declaratory relief

[68]     Declaratory relief is most commonly sought under the Declaratory Judgments Act 1908 (“the Act”).  This enables a Court to make binding declarations of right including in relation to the construction or validity of any deed, agreement or set of rules. A two step process is involved:27

“Proceedings under the Declaratory Judgments Act require the Court to first determine whether the matter in respect of which a declaration is sought falls within the scope of the Declaratory Judgments Act (the jurisdiction issue) and, secondly whether the case is an appropriate one for the exercise of the Court’s discretion to make a declaration.”

[69]     Jurisdiction is conferred through one of two provisions in the Act.  Section 3 provides:

“3       Declaratory orders on originating summons

Where any person has done or desires to do any act the validity, legality, or effect of which depends on the construction or validity of any statute, or any regulation made by the Governor-General in Council under statutory authority, or any bylaw made by a local authority, or any deed, will, or document of title, or any agreement made or evidenced by writing, or any memorandum or articles of association of any company or body corporate, or any instrument prescribing the powers of any company or body corporate; or

Where any person claims to have acquired any right under any such statute, regulation, bylaw, deed, will, document of title, agreement, memorandum, articles, or instrument, or to be in any other manner interested in the construction or validity thereof,—

such person may apply to the High Court by originating summons for   a   declaratory   order   determining   any   question   as   to   the construction or validity of such statute, regulation, bylaw, deed, will, document of title, agreement, memorandum, articles, or instrument, or of any part thereof.”

[70]     Section 2 also states:

“2       Declaratory judgments

No action or proceeding in the High Court shall be open to objection on the ground that a merely declaratory judgment or order is sought thereby, and the said Court may make binding declarations of right, whether any consequential relief is or could be claimed or not.”

[71]     Section 3 confers a specific jurisdiction on a Court to determine the validity, legality or effect of a statute, rule or written agreement.   Courts have frequently commented that declarations under this provision are inappropriate in cases where contested facts need to be determined,28 or where the Court is being asked to address

a purely hypothetical question29 or give an advisory opinion.30

28     Ambrose v Attorney-General [2012] NZAR 23 (HC) at [33]; Hayes v Parlane [2014] NZHC

2416 at [33]; Mandic v Cornwall Park Trust Board [2011] NZSC 135, [2012] 2 NZLR 194 at

[5]-[8].

29     Telecom  New  Zealand  Ltd  v  Commerce  Commission (2005)  3  NZCCLR  40 (HC)  at  [44]- [46]; Canterbury Regional Council v Attorney-General [2009] NZAR 611 (HC) at [22].

30     Auckland City Council v Taubmans (New Zealand) Ltd [1993] 3 NZLR 361 (HC) at 365.

[72]     Section 2, on the other hand, operates as a catch-all provision.  In effect, it permits a Court to make a declaration in any circumstance not covered by s 3 directly.31

[73]     I consider it clear in this case that the Court has jurisdiction to make a declaration under the Act through one or both of these provisions.

[74]     Whether it should do so is a separate matter, which I shall consider if I determine that a cause of action has been made out.  At this stage I simply note that the remedy is purely discretionary. This is confirmed by s 10:

“10     Jurisdiction discretionary

The jurisdiction hereby conferred upon the High Court to give or make a declaratory judgment or order shall be discretionary, and the said Court may, on any grounds which it deems sufficient, refuse to give or make any such judgment or order.”

[75]     Mr Pidgeon submits, and I accept, that there is some debate over whether the Court also has the power to make declarations at common law or through its inherent jurisdiction  particularly  where  the  statutory  requirements  are  not  met.32    The plaintiffs have not specified which avenue of relief they seek to use.  Traditionally declarations under s 3 were brought by way of proceedings on originating summons whereas declarations under s 2 were brought by ordinary proceedings.  In practice this is a distinction without a difference.  Regardless of whether the declaration is sought under the Act, at common law or through this Court’s inherent jurisdiction it

remains a matter for the Court’s discretion.

What are the applicable rules which apply to Co-operative Ventures?

The rules

[76]     In this judgment reference has already been made to the PCANZ’s Book of

Order and the PCV which govern Co-operative Ventures (“CVs”) such as the AUP.

To  place  the  causes  of  action  in  the  proper  context,  and  to  allow  them  to  be

31     Johnston v Johnston [1991] 2 NZLR 608 (HC); Simpson v Whakatane District Court (No 2)

[2006] NZAR 247 (HC); Ambrose v Attorney-General [2012] NZAR 23 (HC).

32     Peter Blanchard (ed) Civil Remedies in New Zealand (online ed, Thomson Reuters) at [14.7.1];

Peters v Davison (No 2) [1998] NZAR 309 (HC).

determined  effectively,  it  is  necessary  to  review  these  rules  more  closely  and examine how, in practice, they operate in the context of the AUP.

[77]    In discussing this question I am assisted by the evidence of Rev Peter MacKenzie. Although Rev MacKenzie did not give oral testimony at the hearing his evidence in the form of two affidavits was admitted by agreement.  I advised counsel that unless his evidence was contradicted it would be accepted as admissible expert evidence.  No other witness with expertise in UCANZ matters generally or the PCV in particular was called.  In any event, I do not understand that any material parts of Rev MacKenzie’s evidence are regarded as controversial.  Certainly, no counsel has submitted as such.  Furthermore, much of Rev Mackenzie’s evidence is consistent not only with  the evidence of others but  also  a plain  reading of the  rules  and principles he discussed in his evidence.

[78]     Rev MacKenzie has been an ordained Presbyterian Minister for some 30 years.  For the past eight years he has been the Executive Officer for UCANZ.  As Executive Officer,  Rev MacKenzie works  closely with  the five  UCANZ partner churches which are the Presbyterian, Methodist, Anglican, Christian and Congregational Union churches.   He also works with the various co-operating parishes around New Zealand, including the AUP.   He has had no personal involvement with the present dispute and no direct dealings with the AUP although, unsurprisingly given his role in UCANZ, he was aware of the circumstances.

[79]     All CVs, including the AUP, fall under the provisions of the PCV.33  The rules and principles which govern the activities of the AUP are drawn from three primary sources; the PCV, the PCANZ Book of Order and the Laws and Regulations of the Methodist Church of New Zealand.  The PCV and the Book of Order, and how they operate in relation to one another, are discussed more fully below.34

[80]     The PCV were adopted by the five partner churches in 2012 through their umbrella organisation, UCANZ.  They replaced a set of provisions which had been

33     Procedures for Co-operative Ventures, Rule 1.5.1.

34     In the circumstances of these proceedings, given the nature and focus of the dispute, it is not necessary to discuss the Methodist Rule Book.

developed by the partner churches  when  the forum  of CVs  was  established by

UCANZ.

[81]     All CVs, such as the AUP, are subject to the PCV as provided for in rule 1.5.1 which states:

“1.5     Legalities

1.5.1    APPROVAL

The  Procedures  for  Cooperative  Ventures  have  been  approved  by  the Forum of Co-operative Ventures (2011) and the Partner Churches to guide the partnerships Cooperative Ventures.   Irrespective of the date of inauguration, the current Procedures for Cooperative Ventures applies to all Cooperative  Ventures  acknowledged  through  UCANZ  and  replace  the Guide to Procedures (2001).   The accompanying Documents, Guidelines and Forms are provided to resource the local churches and partners in working out their shared journey.  Exceptions for special cases are possible where the local church partners have agreed in writing that specific circumstances   exist   and   are   approved   by   the   UCANZ   Standing Committee.”

[82]     CVs remain constituent churches of the partner churches involved in the local

CV. This is reflected in rule 1.5.3 which states:

“1.5.3     STATUS COOPERATIVE VENTURES

It is important to note that Cooperative Ventures are not a legal entity in themselves and cannot enter into a formal lease or assume corporate status. Local churches are part of the wider churches to which they affiliate and cannot act independently or contrary to the laws of the Partner Churches.”

[83]     The  relationship  between  the  PCV  and  the  rule  books  governing  the particular partner churches is set out in rule 1.5.4.  The CV is required to operate under the PCV and the law books of the partner churches.  While a local church may develop its own local rules or procedures these may not conflict with the PCV as is apparent from the following provision:

“1.5.4     COVENANTS, CONSTITUTIONS and AGREEMENTS

When an acknowledged Cooperative Venture is formed there is a covenant agreement  that  outlines  how  the  partnership  will  function.    The  local church, as a Cooperative Venture, falls under these Procedures for Cooperative Ventures and  the  law books of the  local church’s Partner Churches.  A local church may develop a constitution which outlines local processes, but these cannot conflict with the Procedures for Cooperative Ventures.”

[84]     According to Rev MacKenzie the processes set out in the PCV provide the guidance by which every CV such as the AUP is obliged to comply.

[85]     Each CV has a co-ordinating partner which is responsible for taking a leading role in the governance of the local church.35   As Rev MacKenzie confirmed, in the event the PCV do not provide guidance in relation to a particular matter, the rules and processes of a CV’s co-ordinating partner would then typically apply. Alternatively it seems, in practice, the CV as a whole could adopt a particular custom or set of customs, provided this did not conflict with either the PCV or the rule books

of the partner churches.

[86]     At the time of the dispute the co-ordinating partner of the AUP was the Northern Presbytery.   As such the alternative partner church rules were those contained in the Book of Order.36    Significantly, the Book of Order recognises the principle  that  where  a  Presbyterian  church  is  a  partner  in  a  CV the  principles contained in the PCV apply in preference.

“2.2     Authority of the Book of Order

All members of congregations and any other person affected by any provision in the Book of Order must comply with the Book of Order, except for members of Cooperative Ventures in circumstances where the Guide to Procedures in Cooperative Ventures applies.”

[87]     From  this  analysis  it  is  apparent  that  the  primary  rules  governing  the operation of the AUP are those contained in the PCV.   Only to the extent these procedures do not provide guidance will the principles contained in the Book of Order apply.

Breach of Contract

[88]     Because discussion of this cause of action will necessarily involve making factual determinations which will be of assistance throughout this judgment, it is

appropriate to consider this issue first.

35     Procedures for Co-operative Ventures, Rule 2.1.1.

36     Adopted and prescribed by the General Assembly of the Presbyterian Church of Aotearoa on

29 September 2006 as amended in 2008 and 2010.

Is there an enforceable contract between the parties?

[89]     In respect of both incorporated and unincorporated societies (as is the case here), the Courts have traditionally expressed a degree of reluctance to rule on disputes of a non-proprietary nature or in circumstances where it is clear no legal relationships were intended to arise between members.37     In recent years this reluctance has yielded somewhat to the reality that, as with commercial bodies, organisations  which  are  purely social,  political,  sporting or religious  in  purpose

require an avenue through which disputes may be finally settled.  In an appropriate case  the  Courts  will  intervene  to  protect  non-proprietary  rights  such  as  voting rights.38

[90]     It is now recognised that the rules of an incorporated society constitute a contract between its members and the society itself, enforceable in the same manner as any other contract.39    It has been held that this general principle also applies to unincorporated societies including voluntary religious bodies albeit that the contract is between the members themselves. 40   This is because the society cannot be a legal entity in its own right.   Most recently, in  Shergill & Ors v Khaira & Ors, the Supreme Court of the United Kingdom made the following helpful comments:41

“The law treats unincorporated religious communities as voluntary associations.  It views the constitution of a voluntary religious association as a civil contract as it does the contract of association of a secular body: the contract by which members agree to be bound on joining an association sets out the rights and duties of both the members and its governing organs.  The courts will not adjudicate on the decisions of an association’s governing bodies unless there is a question of infringement of a civil right or interest.

…

The  governing  bodies  of  a  religious  voluntary  association  obtain  their powers  over  members  by  contract.    They  must  act  within  the  powers

37       Mark von Dadelszen Law of Societies (3rd ed, LexisNexis, Wellington, 2013) at [5.5.6].

38       See Antunovich v Dalmatinsko Kulturno Drustvo Inc [2001] NZAR 229 citing Woolford v

Smith [1971] All ER 1091 per Megarry J.

39Lee v Showmen’s Guild of Great Britain [1952] 1 All ER 1175; affirmed in New Zealand in Antunovich v Dalmatinsko Kulturno Drustvo Inc, above n 38, Byrne v Auckland Irish Society Inc [1979] 1 NZLR 351 at 364, Kung v Country Section NZ Indian Association Inc [1996] 1

NZLR 663 and Stratford Racing Club Inc v Adlam [2008] NZAR 329 (CA).

40‘Akau’Ola v  President of  the  Conference of  the  Methodist Church  of  New  Zealand  HC Auckland CP183/SW01, 26 June 2001 at [26]; Peters v Collinge [1993] 2 NZLR 554; see also the comments of William Young J (joined by Glazebrook J) in Gilbert v Body Corporate

162791 [2016] NZSC 61 at [31].

41       Shergill & Ors v Khaira & Ors [2014] UKSC 33 at [46]-[48].

conferred by the association’s contractual constitution.  If a governing body of a religious community were to act ultra vires, for example by seeking a union with another religious body which its constitution did not allow, a member of the community could invoke the jurisdiction of the courts to restrain an unlawful union.”

[91]     What I take from these authorities, and the passage cited from Shergill in particular, is that a contractual relationship does exist between the parties, as the plaintiffs claim.  Mr Pidgeon not only accepts this principle but urges the Court to adopt this approach.

[92]     However, where the parties in the present proceedings differ is on the issue of which rules apply and have contractual force.  The plaintiffs assert that the PCANZ Book of Order, the Laws and Regulations of the Methodist Church of New Zealand and the PCV, all remain relevant and applicable.  The first defendants claim that only the PCV apply to the present dispute.

[93]     Consistent with my discussion above, I consider that the PCV are the primary applicable  rules.    These  rules  make  room  for  and  indeed  incorporate  the  more specific provisions contained in the rule books of the partner churches.  Where the PCV do not apply to an aspect of the present dispute, then the Book of Order, as the rule book of the co-ordinating partner, is applicable as are the particular customs and practices which have been established over time within the AUP.  My impression of the evidence given by the witnesses for the first defendant is that they too believed

that all three of these sources continued to play a part in the running of the AUP.42

[94]     Support for this view is derived from the overriding principle that the PCV are intended to apply to all united churches throughout New Zealand.  They must be flexible enough to incorporate local practices which are inevitably both diverse and deeply embedded.   In practice, the purpose of the PCV is to co-ordinate relations between partner churches and provide for the establishment of a fair and effective governance  structure  within  each  uniting  church,  like  the AUP.    The  rules  and

practices  relating  to  the  day  to  day  management  of  congregations  are  left  to

42     In particular I am referring to the oral and written evidence of Mary McEwing and Rev Alisa

Lasi.

individual  churches  to  formulate,  either by deference to  the practice of the co- ordinating partner or by following an established custom.

[95]    I consider that all three of these sources of authority form part of the constitutional structure of the AUP.  Accordingly these rules also form part of the contract regulating membership.

[96]     Although I do not understand this to have been challenged by the defendants, I also accept that the present dispute is justiciable.  To the extent the dispute engages issues relating to the plaintiffs’ rights to vote as members of the governing body of the AUP, it engages civil rights of the sort discussed in Shergill.   Furthermore, to determine the present dispute the Court is not required to enquire into matters of religious doctrine or orthodoxy.  I am conscious that the role the Court is adopting in this case, effectively determining whether a group of individuals remain members of a particular church, sits somewhat uncomfortably with the traditional reluctance of the secular courts to intervene in the affairs of religious bodies. Were the plaintiffs in this case alleged to have left the AUP owing to a dispute over faith, for example if they were  refusing  to  abide  by a  particular  aspect  of  church  doctrine,  I would certainly have been hesitant to recognise the justiciability of the dispute.  However, the allegation here is simply that rules of procedure and practice have been breached on both sides.  In effect, all that is required of the Court is for it to “keep the parties

to their contract”.43

Was there a breach?

[97]     The central issue in these proceedings, as agreed by counsel and recorded by Duffy J in her judgment, is whether or not the plaintiffs’ group remained part of the AUP as at 5 December 2013.44   Before undertaking this complex determination, it is helpful to briefly consider whether a breach would have been found in any event.

[98]     If  Talaoali’i  Naseri,  Silipi  Auva’a  and  Michael  Tuiletufuga  remained members of the AUP and thus Parish councillors, it appears that at least some of the

alleged contractual breaches advanced by the plaintiffs will have been made out on the evidence.  My reasons follow.

[99]     First, the election of new Parish councillors which took place at the meeting of 23 October 2013 was not carried out in accordance with the PCV.  The election of a  Parish  councillor  may only take  place  at  an Annual  Meeting  of  the AUP as provided for in rule 3.2.3:

“3.2.3   The local church council reports to the congregation(s) through an Annual Meeting and that meeting elects the members of the local church council.”

[100]   As  the  plaintiffs  submit,  the  meeting  of  23  October  was  not  an Annual Meeting of the AUP.  Neither do the first defendants suggest it was.  Indeed, a Notice of Resolution prepared by Mr Tuia (the Secretary of the SSF) records that the Annual Meeting for that year actually took place on 17 November 2013.45    Accordingly, I accept  Ms  Woodroffe’s  submission  that  the  elections  of  Mesdames  Maiama, Crichton and Mr Falevaai were not, in all likelihood, compliant with the PCV.

[101]   Secondly, it is accepted by the first defendants that if the three original SSF members were still Parish councillors at the time of the meeting on 5 December, they were in principle entitled to notice of this meeting.   It is accepted notice was not given.

[102]   Unsurprisingly, the section in the PCV dealing with Local Church Councils (an alternative name for Parish Councils) does not contain a provision requiring that a particular period of notice be given or that notice be given at all.   In its stead, Ms Woodroffe submits that rule 7.16(2) of the Book of Order applies, requiring the moderator of a church council to give not less than 10 working days’ notice of a meeting.  By custom Parish Council meetings took place on the second Tuesday of

every month.46    This was not, however, a typical or usual Parish Council meeting,

having been called by the Northern Presbytery.   Given the relatively complex constitutional structure of the AUP, to attempt to specify a required notice period to the day would be to import or require a greater level of prescription and formality

than is warranted or contemplated by the rules. As will become apparent later in this judgment, this refinement has little practical application in any event.  I accept some notice would have been required, as the first defendants conceded before Duffy J and in the hearing before me.

[103]   If the plaintiffs’ group and their Parish Council representatives in particular did not repudiate their membership of the AUP, this cause of action will have been made out.

Were the members of the plaintiffs’ group part of the AUP as at 5 December 2013 or

had they repudiated their membership?

[104]   This  is  the  central  issue.    The  first  defendants  submit  that  by words  or conduct, the plaintiffs’ group clearly indicated they no longer wished to remain part of the AUP or to be bound by the PCV.   They had, in effect, repudiated their membership in the AUP.

[105]   In contrast, the position of the plaintiffs’ group is that put at its highest, all they did was to signal or evince an intention or desire to leave the AUP.   The plaintiffs’ group say they took no steps towards achieving such a course let alone initiating any of the formal procedures required under either the PCV or the Book of Order to achieve that result.

The law on repudiation

[106]   As Ms Woodroffe urges me to bear in mind, whether or not a breach of contract amounts to a repudiation is a “serious matter not to be lightly found or inferred.”47   The test is an objective one;48 whether the actions of the complained of party, in all the circumstances, are such as to lead a reasonable person to conclude

that the party no longer intends to be bound by the provisions of the contract.49   This

47     Ross Smyth & Co Ltd v Bailey, Son & Co [1940] 3 All ER 60 at 71; see also J Burrows, J Finn and S Todd Law of Contract in New Zealand (5th ed, LexisNexis, Wellington, 2009), at 670.

48     Betham  v  Margetts  [1996] 2 NZLR 708 (HC) at 711; Starlight  Enterprises Ltd  v  Lapco

Enterprises Ltd [1979] 2 NZLR 744 (CA) at 745-756.

49     Universal Cargo Carriers Corp v Citati [1957] 2 QB 401 at 436; Seadrill Management Services

Ltd v OAO Gazprom [2009] EWHC 1530 (Comm), [2010] 1 Lloyd’s Rep 543 at [249].

intention may be inferred from express instructions or implied from conduct.50   The critical point is that it be made plain and clear that one party would no longer be meeting its obligations.51

Is the test for repudiation met on the evidence?

[107]   One of the difficulties in the present case is that the PCV do not impose express obligations on individual members of uniting churches.  As I have already discussed, this is likely due to the fact that the PCV are intended to govern the broader relations between the partner churches, and not the day to day running of CVs.

[108]   Rule 4.6 of the Book of Order does set out, at least in a broad sense, the obligations of members of PCANZ.  It provides that:

“A member of a congregation must fulfil the following responsibilities:

(a)       lead a life consistent with his or her profession of the Christian faith, (b)    as far as he or she is able, join in the worship, life, and mission of the

congregation,

(c)       as far as he or she is able, contribute to supporting the worship, life, and mission of the congregation,

(d)      accept the spiritual oversight of the Church, and

(e)       accept the discipline of the Church.”

[109]   Some obligations are implicit in membership of any religious body.   Such terms are to be implied in the contract of membership.  Of particular relevance to the present dispute is the central obligation to submit to the authority of the church and to be willing to participate constructively in its operation.   As previously noted, while members of the AUP’s congregation may affiliate denominationally as Presbyterian  or  Methodist,  the  church  they  belong  to  is  the  United  Parish  of Avondale.  The partners are the signatories to the 1972 agreement, the PCANZ and

the Methodist Church of New Zealand.

50     Spettabile Consorzio Veneziano di Armamento e Navigazione v Northumberland Shipbuilding

Co Ltd (1919) 121 LT 628 at 634. Hochster v De la Tour (1853) 2 El & Bl 678, 118 ER 922.

51     Denarau Investments Ltd v Ludlow [2008] NZCA 158, (2008) 9 NZCPR 525 at [23].

Decision on repudiation and reasons

[110]   I have concluded that the actions and declarations of the plaintiffs’ group were such that a reasonable person would have concluded they no longer intended to be  bound  by  the  constitutional  structure  of  the AUP  or  by  their  most  central obligations as members.  The plaintiffs’ group not only evinced a clear intention to leave the AUP but had, in effect and in fact, left the AUP.  Accordingly, I consider that  they  had  repudiated  their  membership  in  the AUP before  the  meetings  of

23 October and 5 December 2013.  My reasons for so concluding now follow.

(i)       Declaration a new church formed

[111]   The dispute between the plaintiffs’ group and the remainder of the AUP had clearly been brewing for some time and although formal separation was sought as early as June 2013 matters came to a head on 13 October 2013.   This was White Sunday.  The plaintiffs’ group did not attend the morning SSF service.  Supporters of Rev Amosa  congregated  in  the  church.    Neither  the  Parish  Council  nor  those elements within the SSF who did not support Rev Amosa or the AUP joining the PI Synod  were  aware  this  service  had  been  organised.    Those  affiliated  to  the defendants’ group who witnessed this service described Malielegaoi Aumua addressing the congregation and celebrating the creation of the new church.  Indeed, Ms  Auva’a,  for  the  plaintiffs’  group,  accepted  under  cross-examination  that Mr Aumua had announced to those gathered their church had been established and it was a different church from the morning fellowship.

[112]   Furthermore, Mr Aumua had been a senior member of the SSF.   However, after the split he described himself as the secretary of the PIC Avondale, a newly created role and one which had not existed previously either within the SSF or the AUP.

[113] Susana Maiama was at the White Sunday service when Mr Aumua congratulated  everyone  that  they  had  “finally  done  it”.     This  statement  was consistent with the meeting on 16 September 2013 at which the congregation was told   that   a   PIC   Avondale   would   be   established   the   following   Sunday

(22 September 2013).  This did not, in fact, occur but the statement is consistent with the intention, later put into effect on White Sunday, to leave the AUP.

[114]   Additionally, Rev Christian had several meetings with the plaintiffs’ group before the Parish Council meeting of 5 December 2013.  In cross-examination, when explaining why it was that he told the meeting that the plaintiffs’ group had left the AUP, he said he did so because that is what they told him.  He said it was only later that they claimed they had never left the AUP.  He said that it was the leaders of the group who told him that they had left.   He had one meeting with the full Parish. Then he had a meeting with the SSF (being the remainder of that fellowship after the plaintiffs’ group had left) who asked him to consult with the plaintiffs’ group to see whether it was possible for them to reunite.   He went to the plaintiffs’ group who made it clear they would not reunite.   On his evidence he met with the plaintiffs’ group  on  at  least  two  and  possibly  three  occasions.    At  each  meeting  they emphasised they were the PIC church and they were adamant they would not reunite. When Rev Christian was asked who it was he spoke to in the plaintiffs’ group he said there were four leaders but when he attempted to address the whole group he was shut down and permitted only to consult with the four leaders.  He said he was told, “… we’ve left, we’re not the uniting church, we’re the PIC church and there’s no

way we would go back and join them.”52

[115]   Mr Naseri’s evidence was that Rev Christian met with the plaintiffs’ group only once.   In cross-examination he accepted there had been a meeting with the whole of the AUP and that Rev Christian promised to come back and meet with the plaintiffs’ group.  However, according to Mr Naseri, despite promising to return, Rev Christian never did.  For the reasons set out later in this judgment there are aspects of Mr Naseri’s evidence which I do not accept and in relation to this aspect of the evidence I prefer the account given by Rev Christian whose responsibility it was to lead the negotiations on the part of the Northern Presbytery which was attempting to

resolve this issue.  Not only did Rev Christian impress me with his measured and

52     This evidence emerged under cross-examination from Mr Pidgeon, for the first, second, third and sixth defendants.  Ms Woodroffe for the plaintiffs successfully applied to recall Mr Naseri on the grounds that Rev Christian’s evidence of the number of meetings he had  with the plaintiffs’ group was a matter of importance, it   was in the interests of justice to recall the witness, and the issue had arisen ex improvise (refer Evidence Act 2006, s 99(1)).  I permitted Mr Naseri to be recalled on this narrow point.

careful approach to giving evidence but as an intermediary he had relatively little at stake in the dispute, unlike Mr Naseri.   He saw his role as a diplomatic and intermediary one, designed to achieve a resolution between the opposing factions for the wider benefit of the church and the Parish.   For these reasons I accept his account.  In any event the actual number of meetings Rev Christian attended with the plaintiffs’ group is of less importance than his recollection of what was actually said by representatives of the plaintiffs’ group at one or more of those meetings.  This is not something he is likely to be inaccurate, mistaken or wrong about.  His role was to attempt to reach a resolution on behalf of the Northern Presbytery.  It was what senior and influential members of the plaintiffs’ group told him which led him in person to conclude resolution was not possible.  Significantly, he was not seriously challenged on his account of what the plaintiffs’ group told him on the prospects of reconciliation.

[116]   Rev Christian described the difference between the meetings he had with the plaintiffs’ and defendants’ group.  He said he wanted to allow everyone attending to have their say, not just the leaders.  And while the first meeting with the plaintiffs’ group was described by him as lengthy, everyone was invited and encouraged to have their say.   However, in contrast, the second meeting was described by Rev Christian as very abrupt.  At this meeting he was told he was authorised to speak to only four nominated individuals.  He said others at the meeting attempted to speak but were shut down by the leaders and not permitted to speak.  Not only were they stopped but Rev Christian was not permitted to answer their questions.   With open dialogue crushed in this way it is apparent the leaders of the plaintiffs’ group were not open to any discussion designed to reach a resolution unless the outcome suited their purpose of establishing a separate church aligned to the PI Synod.

[117]   Rev Christian said that he twice attended meetings of the plaintiffs’ group where the level of animosity was palpable.  At one meeting a fight almost broke out and at another a fight actually did take place.  He described it in the following way:

“So it wasn’t a case of them just splitting up and having separate times.  The second group, the breakaway group, they wanted to take over everything. … They did not want to come under the auspices of the Presbyterian Church any longer.”

(ii)      Continuation of Rev Amosa’s ministry

[118]   Despite Rev Amosa’s term as Minister concluding in July 2013 he continued as the Minister of the congregation established by the plaintiffs’ group.  Rev Amosa’s tenure as a Minister of the AUP expired on the tenth anniversary of his appointment. From that point he had no relationship of call nor any official role within the AUP. His Ministry terminated through the operation of his appointment and the rules. Even if the AUP had wished to extend his term it could not have.  This fact does not appear to have been understood by many of his supporters within the SSF.  Indeed, I was left with the distinct impression that leading figures within the plaintiffs’ group capitalised on Rev Amosa’s popularity with some in the SSF and formented disunion and dissent towards the AUP by wrongly blaming the leadership of the AUP and/or the Northern Presbytery for ending Rev Amosa’s ministry prematurely.   That was certainly what the joint letter to the Northern Presbytery of 20 November 2013 expressed when it claimed “… your decision to terminate the service of our Minister, Rev Asora Amosa, was both harsh and unjustified …”.

[119]   That Rev Amosa has continued in what appears to be a spiritual leadership role  within  the  plaintiffs’ group  emphasises  the  way  that  group  regards  itself; independent and not accountable to the AUP or its leadership.

[120]   This conclusion is further supported by the uncontradicted evidence that a substantial fund had been raised by the time of the White Sunday service for the new church and Rev Amosa and his wife were identified as primary benefactors whose generosity towards the new entity was publicly acknowledged at that first service of the new church.

(iii)     Separate organisational structure

[121]   On 20 November 2013 four officers of what they described as the Pacific Island Church Avondale wrote to the Moderator of the Northern Presbytery and the Chairperson of the Forum of Co-operative Ventures.   The officers were the chairperson, the secretary, the treasurer and a committee member.   Although this organisational structure was new it appears to have been a formalisation of the roles that various members of the plaintiffs’ group had adopted after the schism.

[122]   I am satisfied, however, that before this dispute arose, the Pacific Island Church Avondale did not exist as a separate entity.   I reject the evidence of the plaintiffs’  group’s  witnesses,  particularly  Messrs  Tuiletufuga  and  Naseri  who claimed the PIC Avondale had been part of the AUP since the start of Rev Si’itia’s full-time “Team Ministry” in 1979.   It is plain that the agreement establishing the Team Ministry at that time was for the purpose of recognising the importance of the growing Samoan component of the AUP.   Nowhere in the agreement is there a reference to a new or separate congregation known as the PIC Avondale.   The agreement was signed by the AUP’s session clerk and the Samoan secretary.  The partner churches of the AUP remained as the Presbyterian and Methodist churches. No additional partner church was created.

[123]   On this point I found the evidence of both Mr Tuiletufuga and Mr Naseri to be evasive and unconvincing.   Both attempted to portray the plaintiffs’ group as indistinguishable from what they called the PIC Avondale.  But the evidence does not support that proposition.  The plaintiffs’ group split from the SSF.  The balance of the SSF still exists.   It is a substantial and sizeable worshipping fellowship.   It continues to worship on Sunday mornings as it did before the schism.  After Rev Amosa’s term expired the AUP’s Team Ministry continued with Rev Lasi and Rev Koko sharing duties as the AUP’s appointed “Team Ministers”.

[124]   In cross-examination, both Mr Naseri and Mr Tuiletufuga patently evaded questions, the answers to which would likely have revealed the fallacy of their assertions.  Not infrequently their answers bore little or no resemblance to the issue engaged by the question, for example the repeated claim they had never left the AUP or that they remained members of the Parish Council.  Another answer which was inapt given the question asked, was that there had always been a congregation within the AUP known as the PIC Avondale.

[125]   When it was put to Mr Tuitelefaga in cross-examination that there are now two Sunday services for the SSF, one in the morning and one in the afternoon, he said  he  only remembered  there  being  one  Samoan  service  and  that  was  in  the afternoon.  That was a most surprising answer given he was formerly a member of the SSF worshipping in the morning and was a central figure in establishing the

group which now worships in the afternoon.  When asked how he would describe the group from the SSF who worship in the mornings he said they were the AUP, adding that in the afternoon it was the Samoan PIC.   He then hastily corrected himself calling it the Presbyterian PIC.   Furthermore, he claimed that the PIC Avondale began in 1972, in other words when the AUP itself was established by the uniting of the Presbyterian and Methodist congregations.   That is plainly incorrect and unsupported by any other evidence.  At no time has the PIC Avondale been a partner in the establishment of the AUP.

[126]   Ms  McEwing  has  been  a  congregational  member  of  the AUP  since  its foundation in 1972.   She described the increase in the Samoan proportion of the AUP’s congregation during the 1970s and it was apparent from her evidence that she regarded this development as a positive one for the AUP.   Ms McEwing greatly impressed me as a sincere and careful witness who, despite her age53  and hearing difficulties did her very best to give an honest, accurate and balanced account to both parties.  She is plainly a much valued and widely admired member across the whole of the AUP.

[127]   She said that she found it difficult to hear the plaintiffs’ group describing themselves as the PIC Avondale.  She said that the Parish has only ever been known as the Avondale Union Parish.   She described the history and background to the development of the ESF and SSF groups, adding that she often attended the SSF services  herself.    She  said  it  was  quite  wrong  for  anyone  to  say the  SSF  was Presbyterian and the ESF was Methodist as at least one witness for the plaintiffs’ group suggested.  The difference between the elements of the congregation was that one was English speaking and the other Samoan speaking.   And while the SSF primarily affiliated as Presbyterian, the members of the ESF affiliated as both Presbyterian and Methodist.  As did other defence witnesses, she also said that until the present dispute she had never heard the name “PIC Avondale” except in the limited context of inter-church sports days when the term was used as a convenient reference or label when members of the SSF were competing against PIC groups from  other  parishes.    Otherwise  members  of  the  Parish,  whether  SSF  or  ESF,

described themselves as members of the AUP.

53     She is 84 years of age.

[128]   Under cross-examination Ms McEwing was asked about what she meant by the Parish only ever being known as the Avondale Union Parish.  Her frank response deserves repetition:

“Well how can I put it?  If they’ve set themselves up as the PIC Church and call themselves the PIC Church then they have done that after the vote that wasn’t 66% in their favour and I’m not quite sure how I can put it.  I don’t see how they can call themselves the PIC Church if they really belonged to the Avondale Union Parish. You understand what I mean?”

[129]   It was then put to her that the term “PIC” had been used since 1972 and was

not a new term.  Ms McEwing’s response was unadorned.  She said:

“That’s a new one on me.”

[130]   A further exchange in cross-examination:

“A.So they went – I understood that they have become the PIC Church, but they didn’t want to come to the meetings.  So why are you trying to get me to say they’re members of the same church?

Q.        Yeap. The –

A.       That, to me, is confusing. Q.       Yes.

A.        They can’t be AUP and PIC Church.

Q.        Why can’t they?

A.        Because it’s two different churches as far as I’m concerned.

Q.        Under what rule are you saying that they can’t? Rule –

A.        It’s getting, you’re getting me all confused.  I don’t know whether I’m Arthur or Martha.  To me, you can be one or the other, not both at the same time.

Q.        But isn’t the union a combination of –

A.        Yes it’s a union of those who want to be combined, not those who want to be separate.”

[131]   Ms McEwing’s evidence on this point is consistent with the evidence of

others as well as the documentary record.

[132]   In finding the plaintiffs’ group established a separate organisational structure which they call the PIC Avondale, I do not overlook that in 2006 Rev Amosa formed APICA.   However, that entity was established for the purpose of receiving funds from the Pacific Island community.  The trust deed states that its aims include the holding of assets and money in trust for the Samoan members of the AUP “… who are commonly called Pacific Island Church Avondale …”.  I have no doubt that the creation of a separate Pacific Island or Samoan church was an aspiration of Rev Amosa as his later actions in 2013 revealed.   However, at the time APICA was established the SSF was unified as  a single worshipping fellowship.   It is  also noteworthy that APICA was established for the Samoan members of the AUP and not the wider Pacific Island community within the Parish.   Its identity and focus was Samoan rather than Pasifika.  This provides further support for the view that in 2006

APICA was  established  for  the  wider  SSF  rather  than  the  specific  group  now

identified as the plaintiffs’ group.

(iv)      Financial independence and lack of contributions to AUP

[133]   Ms McEwing, as the secretary of the Parish Council, was closely involved in the management of the AUP’s finances and, more particularly, ensuring the Parish complied with its fiscal obligations and met its debts as they fell due.  A joint bank account was maintained with the BNZ in the name of the Avondale Union Parish Joint General Account.  As Ms McEwing explained, the contribution ratios between the ESF and SSF were determined by the number of members in each fellowship and it fell to Ms McEwing, as secretary, to maintain a record of the members of the two groups which allowed her to apportion the anticipated costs.  Historically the SSF had paid for the electricity, water and maintenance of the church centre.  The ESF was responsible for the costs associated with other properties.  On a pro rata basis the two groups, depending on the number of members within them at any particular time, paid a monthly amount into the joint general account.

[134]   However, Ms McEwing’s evidence is that since the dispute began around June or July 2013, the ESF has carried the overwhelming burden of maintaining the whole church.  The SSF, including the plaintiffs’ and defendants’ groups, have not contributed except for some automatic payments for certain utilities which have

continued to be paid from the account which is otherwise frozen.  Furthermore, the income from some of the assets formerly controlled by the SSF have not been applied to general AUP purposes.  The reason for this is that after the split the SSF’s bank accounts were controlled by the members of the plaintiffs’ group, who had signing authority, until the freezing orders were made.

[135]   On this  issue Mr Naseri’s  evidence is  instructive.   When  asked whether contributing to the running costs of the AUP was the price of membership, Mr Naseri responded that he could not force people to give money to the church.  When asked what he meant by the church he, tellingly in my view, said, “Our church, the Pacific Island  Church  of  Avondale,  or  our  congregation”.    When  asked  whether  the plaintiffs’ group had contributed to levies since early 2013 he accepted they had not adding that the Northern Presbytery had taken sides.   He then observed that his group had not been given any invoices commenting, “That the only interest the Northern Presbytery had was money; they never attempted to negotiate …”.

[136]   Furthermore, I do not accept Mr Naseri’s explanation that the reason the plaintiffs’ group did not contribute to the expenses of the AUP was because they did not receive invoices.  While it is correct Ms McEwing said she had never sent the afternoon group a demand, she qualified this statement by adding she did not need to because, “…if [the plaintiffs’ group] were going to pay they would have approached me because before 2014 everyone collectively paid for the expenses of the AUP”.

[137]   That the plaintiffs’ group viewed themselves as financially independent and not accountable to the AUP from mid to late 2013 is supported by Mr Worn who said that he attempted to get financial information from both groups.  He said the AUP supplied financial information but the plaintiffs’ group supplied nothing.  This is also consistent with Mr Naseri’s intemperate email of 14 January 2014 in which he made it plain to the Presbytery office he was not prepared to co-operate with the Commission’s  investigation  into  the  finances  and  property issues  of  the  Pacific Island Church Avondale.  Mr Worn said the Commission met a stone wall and it was impossible to determine the correct financial position.  None of the income from the revenue normally received by the SSF appeared in the accounts.  This, according to

Mr Worn, was because the plaintiffs’ group refused to disclose any financial information despite requests to do so.

[138]   There can be no justification for the plaintiffs’ group maintaining control of the finances of the SSF and denying the AUP access to those funds for the purposes of  assisting  the  running  of  the  Parish.    The  funds  had  been  accumulated  from revenue, donations and tithes derived from the efforts and generosity of the whole of the SSF, not just the plaintiffs’ group.   And yet the plaintiffs’ group through its leadership plainly regarded and treated these assets as if they were their own and not the property of the AUP or the balance of the SSF who elected not to join them but had also contributed to the funds over the years.  This is yet another indication that the plaintiffs’ group saw itself as an independent church which was and is separate from and not accountable to the AUP.

(v)      Non-attendance at Parish Council meetings

[139]   The  three  SSF  Parish  Council  members  who  are  also  members  of  the plaintiffs’ group were sporadic attendees, at best, at AUP Parish Council meetings. Rev Lasi, who had attended meetings with the Parish Council for nearly three years prior to the 5 December 2013 meeting observed that Ms Auva’a and Mr Tuiletufuga did  not  attend  any  meetings  over  that  period  except  for  one  appearance  by Ms Auva’a.     Ms  McEwing  said  the  ESF  would  almost  always  have  a  full complement of five members but that was not the case for the SSF representatives.

[140]   Ms Auva’a said that after Rev Amosa left she never got notice of the Parish Council meetings, a proposition which is improbable given the well established practice that Parish Council meetings occurred on the second Tuesday of the month. Ms Auva’a then corrected herself and said that when Rev Amosa was there she was always invited to the meetings but most of the time had to excuse herself because she worked night shifts.   Mr Tuitelefuga appeared to accept that he attended only one meeting of the Parish Council in two and a half years.

[141]   This evidence supports the view of several witnesses that for some time before  the  events   in   October  2013  a  number  of  the  SSF  Parish   Council representatives were disengaged from the AUP and its governing body.

(vi)      Discipline and respect for chain of command

[142]   The  conduct  of  the  plaintiffs’ group  makes  it  plain  that  they  estranged themselves  from  the  authority  of  both  the  Northern  Presbytery  and  the  Parish Council.

[143]   As previously discussed, one implicit obligation of church membership is acceptance   of   the   discipline   of   the   church.      This   was   reinforced   when Rev MacKenzie stated that being a member of a church requires submission to the authority of the church.   In particular, the principles governing the Presbyterian Church make it clear that one cannot be a member of more than one congregation.

[144]   Rev Lasi emphasised this principle by reference to the role of the Parish Council in the AUP.  It is the Parish Council which is responsible for the Parish’s buildings and infrastructure.  If a group wished to set up a new service or worship at a different time using the Parish’s buildings, including the church itself, the Parish Council is the body which must authorise such a course.

[145]   Mr Tuiletufuga accepted, as he was bound to, that joining the Union Parish requires  a  commitment  to  the  structures  and  discipline  of  the  Union  Parish. Similarly, Mr Naseri accepted Rev MacKenzie’s proposition that being a member of the church requires you to submit to the authority of the church.  He also accepted that one could not be a member of more than one congregation.

[146]   Despite accepting this fundamental proposition it is common ground there was no consultation with the leadership of the AUP before the plaintiffs’ group began to conduct its separate service on Sunday afternoons.  There was no consultation as to who would conduct those services.  Indeed the very opposite was the case.  The first Sunday service on White Sunday took place without the knowledge of the balance of the SSF, Rev Lasi or anyone on the Parish Council.

[147]   The  establishment  of  a  new  congregation  led  by  a  Minister  with  no contractual connection to the AUP worshipping in the AUP’s facilities at a different time is, on any analysis, a significant development in the life of the Parish.  That this step was undertaken in stealth, clothed in secrecy and delivered as a fait accompli to

the leadership of the AUP amply demonstrates not only the intention but also the way in which the plaintiffs’ group viewed itself; an independent functioning entity which was not accountable to the AUP.

(vii)     The plaintiffs’ arguments that they had not been removed from the AUP’s

membership roll in accordance with the Book of Order

[148]   Ms Woodroffe urges  me to  place significant  weight  on  the fact  that  the plaintiffs’ group was never formally removed from the membership roll of the AUP, in accordance with the Book of Order;54 a responsibility which she claims fell with the Parish Council.

[149]   In cross-examination of the defence witnesses many were asked to identify which rule or set of rules they relied on to assert the plaintiffs’ group were no longer members of the AUP.   However, this line of challenge is formulated on a misapprehension of the scheme of the rules and their practical application.  As such this submission may be dealt with in short order.

[150]   The removal procedure in the Book of Order is designed to provide a means of removing or expelling members of a Presbyterian church were it to become clear that, either by choice or compulsion, they will play no further role in the active life of the church.  However, as a matter of commonsense church membership fluctuates as individual parishioners and their families move out of the parish, join different congregations  or  experience  lapses  in  faith.     It  would,  in  my  view,  be  an unreasonable and, frankly an unworkable, burden to impose the strict requirement that the church must immediately and unfailingly invoke the formal removal processes every time any parishioner elects to leave the congregation.  The departure of members would  much more likely be taken  into  account  when  the rolls  are reviewed on an annual basis, at which point the procedure would be invoked if necessary, if the governing body of the church was diligent enough to comply with them at all.   As a result, I do not consider that the fact this procedure was not

invoked in the present is particularly telling or of relevance given the circumstances.

54     Rule 4.10(4) and (5).

Conclusion on repudiation

[151]   In all the circumstances, the actions and declarations of the plaintiffs’ group were  such  that  a  reasonable  person  would  have  concluded  that  they  no  longer intended  to  be  bound  by  the  constitutional  structure  of  the  AUP  or  by  their obligations as members.  Through this conduct I consider that the plaintiffs’ group repudiated their membership of the AUP prior to the meeting of 23 October.   Its representatives thus lost their eligibility to serve on the Parish Council, and the remainder of the AUP was entitled to proceed on this basis when electing new members to replace them.   That this was undertaken at a meeting other than an Annual Meeting of the AUP is a technical or procedural breach, and I would not grant the relief sought on this basis alone.  I consider the elections were lawful and valid.    It  follows  that  the  representatives  of  the  plaintiffs’ group  on  the  Parish Council were not entitled to notice of the meeting of 5 December, and that the resolutions passed at the meeting were lawful and valid.

[152]   Having reached this conclusion, it is unnecessary for me to consider the first defendants’ submissions in the alternative regarding the indoor management rule and the doctrine of estoppel.

[153]   For completeness sake, however, I note that the resolutions at the meeting of

5 December were passed by a 10  to 1 margin.   Even if the Parish  councillors representing the plaintiffs’ group had remained members of the Parish Council and voted at this meeting, not having been replaced two months earlier, the resolutions would still have passed by a 7 to 4 margin.

Breach of trust

[154]   The plaintiffs submit that the members of the Parish Council by making day to day decisions about the management of church property are acting in a position of trust  relative to  the members of the AUP.   They say that  this  relationship  was breached by the first defendants in the same manner as the contract of membership; essentially that the elections of Susana Maiama, Perelini Crichton and Namulauulu Falevaai (allied with the defendants’ group) to replace the plaintiffs’ representatives of the SSF on the Parish Council, at the meeting of 23 October, were invalid and

unlawful.  As a result, the plaintiffs maintain that these individuals were not entitled to vote at the meeting of 5 December, which the plaintiffs’ representatives should instead have received notice of and been allowed to participate in.

[155]   The plaintiffs’ case is that this trust relationship arises by way of delegation. In relation to property owned by the two AUP CV partners, the Methodist Board of Administration and the Presbyterian Church Property Trustees55  hold the titles in trust for each of the partner churches.  The Presbyterian Church Property Trustees are the second defendants in these proceedings.   The details of the property are required  to  be  recorded  in  what  are  known  as  the  Schedules  of  Record.    The

Schedules of Record must, from time to time, be reviewed to reflect changes in the property held, the value of the assets and the proportions in which the assets are held for the partner churches.

[156]   The PCV provides guidelines on dissolution56 which state that when a CV is dissolved the assets are divided according to the ratios contained in the Schedules of Record so that each partner church receives its fair share.

[157]   The  effect  of  this  is  that  the  individual  members  of  the AUP  hold  no ownership rights themselves in respect of the property; these are retained by the Presbyterian Church Property Trustees and the Methodist Board of Administration. However, the individual members enjoy beneficial ownership in the sense that they have the use and exclusive possession of the property.

[158]   It is incontrovertible that the management of members’ use and possession is the domain of the Parish Council.   The plaintiffs argue that in so managing the church property and undertaking a decision making function in respect of it, the members of the Parish Council were exercising trustee powers delegated to them by the Presbyterian Church Property Trustees and the Methodist Board of Administration.  Ms Woodroffe submits, and I accept, that such an interpretation is consistent with the provisions of the Presbyterian Church Property Handbook.   A

sample appears below:

55     Pursuant to the Methodist Model Deed of New Zealand 1887 and s 15 of the Presbyterian

Church Property Act 1885.

56     Rule 9.3.4.

“Principle 1

·    Everyone making decisions about property or finance within the Church is a ‘trustee’.

…

Section 16: Duties and Responsibilities of Decision Makers

·    All members of church courts who manage the assets of a parish are in a

‘trustee relationship.’

·    They have responsibilities as trustees in keeping with the Trustee Act

1956.

·    The most important responsibility is to exercise ‘care and prudence’ in

all decisions that are made.

·    There is legal accountability to the parish for this responsibility.”

[159]   If those who deal with church property on a day to day basis in a standard single denomination Presbyterian church exercise delegated trustee powers, it stands to reason that similar powers will be conferred upon those who deal with church property on a similar basis in a united church with a Presbyterian component, such as the AUP.

[160]   I am therefore willing to accept that a trustee relationship exists between the members of the Parish Council and the wider congregation of the AUP.  However, the challenge the plaintiffs’ group faces is that, consistent with my determination above, they had already left the AUP at the time the alleged breaches of this trustee relationship occurred; being at the meetings of 23 October and 5 December 2013. Therefore to whatever extent the first defendants were bound to exercise trustee duties, they were no longer owed to the members of the plaintiffs’ group.

[161]   Even  if  I  had  found  that  the  plaintiffs’ group  had  not  repudiated  their membership of the AUP prior to the complained of meetings, I would not have found that a breach of trust occurred.  In this respect I accept Mr Pidgeon’s argument that these trustee duties are owed to the whole of the AUP congregation, not simply to the plaintiffs’ group.  For the reasons I have set out above, by the time of the meeting of

23 October, and indeed well before then, relations between the plaintiffs’ group and

the remainder of the AUP had deteriorated to such a point that I consider the Parish

Council,  including  the  first  defendants,  acted  in  the  best  interests  of  the AUP

congregation as a whole in reaching the decisions that they did.

Breach of fiduciary duties

[162]   The plaintiffs’ final claim, is that the first defendants breached the fiduciary obligations they owed to members of the AUP, including the plaintiffs.  They make two allegations in this respect:

(a)      First, they allege that the first defendants created a conflict of interest in respect of the present dispute because they would stand to benefit financially from the removal of the plaintiffs’ group.  This is because dissolution  of  the AUP  according  to  the  PCV  would  result  in  a distribution of church property in accordance with the Schedules of Record.  If the plaintiffs’ group were removed they would lose their entitlement  to  a  share  of  the  property  meaning  that  a  greater proportion would be left to the first defendants.

(b)Secondly, it is alleged that the first defendants breached their duty of loyalty and were acting in a conflict of interest as Parish Council members by virtue of the fact that they were on the opposite side of the present dispute.

[163]   Having found that a trust relationship exists between the first defendants and the members of the AUP, it follows that fiduciary obligations are also owed.  The relationship between a trustee and a beneficiary has been described as “the paradigmatic  fiduciary  relationship.”57      Some  of  the  most  important  obligations owed include the duties to avoid unauthorised personal profit or benefit and conflicts between personal interests and duties to the beneficiary.58

[164]   However, the plaintiffs encounter the same obstacle they face in respect of the claim for breach of trust.  The fiduciary obligations in this case are owed to the

57     A Butler Equity and Trusts in New Zealand (2nd  ed, Thompson Reuters, Wellington, 2009) at

17.3.1; See also K Ayers “Fiduciary obligations in express trusts” [1997] NZLJ 243.

58     See Boardman v Phipps [1967] 2 AC 46 (HL) and Chirnside v Fay [2006] NZSC 68.

members  of  the AUP.    By  the  time  of  the  alleged  breaches,  the  plaintiffs  had repudiated their membership of the uniting church, meaning they were no longer parties to this relationship of trust and confidence.

[165]   And even if this were not the case, the fiduciary obligations would have been owed to the whole of the AUP congregation, not just the plaintiffs’ group.  By acting in the manner that they did the first defendants were acting in an earnest and sincere attempt to protect the integrity of the remainder of the AUP.  It follows I would not have found a breach occurred even if the plaintiffs’ group had remained part of the church.

Result

[166]   All three of the plaintiffs’ causes of action are dismissed.  Accordingly the declaratory  relief  sought  is  declined.    The  practical  effect  of  this  is  that  the resolutions passed on 5 December 2013 are found to be lawful and enforceable.

Costs

[167]   The defendants, as the successful party, are entitled to costs.   I regard this matter as properly covered by a 2B award.

[168]   I invite counsel to confer with a view to filing a consent memorandum.  In the event the parties are unable to agree I direct memoranda to be filed and served no

later than 20 working days from the date of this judgment.

Moore J

Solicitors:

Ms Woodroffe, Auckland Mr Pidgeon, Auckland Meredith Connell, Auckland