Navy League Canterbury (NZ) Incorporated v Bell-Thompson

[2013] NZHC 1275

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

CIV-2013-409-001080 [2013] NZHC 1275

BETWEEN  NAVY LEAGUE CANTERBURY (NZ) INCORPORATED

Plaintiff

ANDSONIA BELL-THOMPSON Defendant

Hearing:                   31 May 2013

Appearances:           H Evans for Plaintiff

D Lester for Defendant

Judgment:                31 May 2013

ORAL JUDGMENT OF CHISHOLM J

[1]      For many months there has been strife within Canterbury Navy League, the plaintiff in this proceeding.  To a large extent this reflects difficulties between Simon Courtney the president, and Sonia Bell-Thompson, who has been involved as secretary.  Amongst other things there are issues about the validity of meetings and the election of officers.

[2]      This proceeding, which was issued on 27 May 2013, seeks declarations and other relief, including interim relief.   Counsel on both sides have adopted a constructive approach to the issue of interim relief, as have the parties.  The hearing today only concerns the issue of interim relief.

A brief background

[3]      The Navy League was incorporated in 1939.  Its rules, which are before the

Court, have played a significant part in the disputes that have arisen.

NAVY LEAGUE CANTERBURY (NZ) INCORPORATED v BELL-THOMPSON [2013] NZHC 1275 [31 May

2013]

[4]      At an annual general meeting on 19 June 2012 various officers were elected, including Mr Courtney as president and Mrs Bell-Thompson as secretary. Unfortunately the necessary quorum of financial members was not present.  While this was recorded in the minutes the implications do not appear to have been appreciated at the time.

[5]      Following  that  meeting  issues,  largely  involving  process,  arose  between Ms Bell-Thompson  and  Mr  Courtney.     Matters  developed  to  a  point  where Mr Courtney threatened to tender his resignation, although in the event he did not do so.

[6]      On 16 November 2012 Mr Courtney asked Ms Bell-Thompson to convene a special general meeting.  She declined because the necessary percentage of financial members had not supported the request.  Thereupon email support was provided by five other members but the request to convene a special general meeting was not actioned.

[7]      The outcome was that Mr Courtney sent out his own notice of a special general meeting to be held on 27 November 2012.   However, Ms Bell-Thompson gave notice of a special general meeting to be held the day before.  Both meetings were held and thereafter there were what might be described as competing factions.

[8]      It seems that matters came to a head when Ms Bell-Thompson indicated that the   annual   general   meeting   would   be   held   next  Wednesday,   5 June   2013. Presumably it was that action that prompted the issue of this proceeding and the application for interim relief.

The interim solution

[9]     As already mentioned, with the assistance of counsel both parties have recognised that this matter needs to be resolved, at least on an interim basis.  The solution proposed by the defendant was that she would resign from the executive committee of the plaintiff effective on 31 May 2013, she would deliver up to the plaintiff’s solicitor material that she holds which belongs to the plaintiff, and she

would not object to an extension of time for the scheduled annual general meeting provided it was not delayed beyond the end of July 2013.

[10]     Although a number of issues have been discussed by counsel this morning, it has not been possible for them to obtain formal instructions.

[11]     One issue is the timing of the delivery of the material held by Mrs Bell- Thompson.  That should not present any difficulty.  The material should be delivered up immediately so that progress can be made towards finalising the accounts and preparing  an  annual  report  which  will  be  prerequisites  for  the  annual  general meeting.

[12]     The other issue was the timing of the annual general meeting.   Mr Evans indicated that the plaintiff considered that a meeting should be held by the end of October rather than the end of July.   This was not accepted by Mr Lester who thought that it should be possible to convene the annual general meeting before the end of July.   A compromise of the end of August was suggested.   I adopt that suggestion.

[13]     The following orders are made:

(a)      the  defendant  is  to  resign  from  the  executive  committee  of  the plaintiff, effective from 31 May 2013;

(b)      she is to forthwith deliver up to the plaintiff’s solicitor material she

holds which belongs to the plaintiff;

(c)      she  is  not  to  have  any  further  contact  with  the  bank  or  other organisations about the affairs of the League;

(d)there will be an extension of time for the scheduling of the annual general meeting on the basis that the annual general meeting is to be held by the end of August 2013.

[14]     The  possibility of  either  or  both  sides  endeavouring  to  “stack”  financial members before the annual general meeting was discussed.  We considered whether a pragmatic solution  would  be for the Court to  direct  no  further new  financial members were to be admitted to the League between now and the annual general meeting.  But I ruled out that possibility.

[15]     Nevertheless, I record that the Court will expect restraint and common sense on the part of all involved.   If there are obvious attempts to “stack” the financial membership before the meeting this is likely to count against those involved, should the matter come before the Court again.  Having said that, I accept that if there are people who up until now have displayed a genuine interest in the League and who wish to become financial members before the annual general meeting it is difficult to see why, provided the rules are followed, those people should not be permitted to join.

[16]     Another issue that has been traversed is the role that should be undertaken by the executive committee pending the annual general meeting.  I agree with counsel that this will be effectively a caretaker role.

A final word

[17]     The parties will need to take care to ensure that the annual general meeting is convened in accordance with the rules, subject to the extension of time that I have granted.  Hopefully, there will be no further issues about the validity of the election of officers at that meeting.  Put simply, both sides should try to bury the hatchet and act in accordance with the interests of the League.

[18]     Costs are reserved.   I reserve leave to either party to apply further.

Solicitors:

Young Hunter, Christchurch

Dale Lester, Christchurch