Styles v Ku-Ring-Gai Historical Society [2003] NSWSC 926

New South Wales Supreme Court

CITATION : Styles v Ku-Ring-Gai Historical Society [2003] NSWSC 926 HEARING DATE(S) : 14 October 2003 JUDGMENT DATE : 15 October 2003

JUDGMENT OF : Gzell J DECISION : Declaration that committee resolution void. Summons otherwise dismissed.

CATCHWORDS : ASSOCIATIONS AND CLUBS - Incorporated Associations - Rules - Whether a committee has power to determine that nominations for committee membership will not be put to a general meeting - Whether that power rests in the chairman of the meeting - Whether the court should declare the nominations valid LEGISLATION CITED : Associations Incorporation Act 1984 Associations Incorporation Regulation 1999 St George Bank Ltd v Rangers Club of NSW Inc (1995) 18 ACSR 370 CASES CITED : Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 Rivers v Bondi Junction-Waverly RSL Sub-Branch Ltd (1986) 5 NSWLR 362 PARTIES : Kathleen Styles - Plaintiff Ku-Ring-Gai Historical Society - Defendant FILE NUMBER(S) : SC 4992/03 COUNSEL : N L McCaffery - Plaintiff W Purdon (Solicitor) - Defendant SOLICITORS : W Purdon - Defendant

IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION

GZELL J

WEDNESDAY 15 OCTOBER 2003

4992/03 KATHLEEN STYLES v THE KU-RING-GAI HISTORICAL SOCIETY JUDGMENT 1 By her amended summons, the plaintiff, the secretary of the defendant, seeks a declaration that nominations for the election of members of the committee of the defendant at its adjourned annual general meeting to be held this evening are valid and a declaration that a resolution passed at an extraordinary committee meeting of the defendant, approving for election only certain of the nominated candidates, is void. The defendant has entered an appearance submitting to the making of all orders save as to costs. 2 The defendant is incorporated under the Associations Incorporation Act 1984. Its rules provide for a committee constituted by its office bearers and five ordinary members to be elected at an annual general meeting. Rule 14(1)(a) provides that nominations for election of committee members shall be made in writing, signed by two members of the defendant and accompanied by the written consent of the candidate which may be endorsed on the form of nomination. Rule 14(1)(b) requires nominations to be delivered to the secretary not less than seven days before the date fixed for the holding of the annual general meeting at which the election is to take place. 3 The annual general meeting was convened on 17 September 2003 and adjourned to today. At its extraordinary meeting held on 22 September 2003, the committee excluded the nominations of Kelvin Grose for president on the basis that it had been written in a single handwriting and was therefore not signed by a proposer and seconder and the nomination of Peter Derwent for committee member on the basis that the plaintiff had not provided the nomination immediately prior to the annual general meeting on 17 September 2003 and had not disclosed it to the immediate past president on inquiry after the due date for closure of nominations. 4 The plaintiff swears that she has since located the correct nomination of Mr Grose as well as the form that was mistakenly photocopied. The document she identifies as the correct form appears to be signed by the candidate and the seconder, but the name of the proposer appears to be written and not signed by her. The nomination of Mr Derwent appears to be signed by him and by a proposer and seconder. The plaintiff swears that she received nominations not less than seven days before the 17 September 2003. That evidence was not challenged. 5 The matter came before me yesterday in my duty list. Neither party pointed to any authority on the point. Reference was made to St George Bank Ltd v Rangers Club of NSW Inc (1995) 18 ACSR 370, Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 and Rivers v Bondi Junction-Waverly RSL Sub-Branch Ltd (1986) 5 NSWLR 362. Those decisions are of no assistance. 6 Model rules are prescribed under the Associations Incorporation Act 1984. They are contained in the Associations Incorporation Regulation 1999, Sch 1. Section 19(3) provides that where the model rules make provision in relation to any matter and the rules of an incorporated association do not, the relevant provision of the model rules is deemed to be included in the rules of the association. That provision does not apply to the defendant with respect to the matter in issue because its rules are drawn in accordance with the model rules on the subject. 7 It was submitted on behalf of the defendant that the committee had authority to take the action it did under r 12(c) which provides that the committee, subject to the Associations Incorporation Act 1984, the Associations Incorporation Regulation 1999, its rules and any resolution passed in general meeting, has power to perform all such acts and do all such things as appear to the committee to be necessary or desirable for the proper management of the affairs of the association. 8 The committee thought it could act under this power for it mentioned it in its resolution limiting the nominations to go forward to the adjourned annual general meeting. The committee also referred to r 14(6) which provides that a ballot for the election of a committee member shall be conducted at an annual general meeting in such usual and proper manner as the committee may direct. 9 In the limited time I have had to determine this matter, I have formed the view that neither rule justified the committee in resolving to exclude the nominations of Messrs Grose and Derwent. The election of members of the committee is a matter for a general meeting of the defendant. It is not a matter for the committee unless it is called upon to fill a casual vacancy. Procedure at a general meeting is in the hands of the chairman of that meeting. It is for he or she to determine the nominations that should go forward for consideration by the members. In making that decision the chairman will usually seek a report from the secretary as to the validity of the nominations. It is the duty of the secretary to ensure that nominations reported to the chairman as valid conform with r 14(1). The secretary may carry out an investigation or cause an investigation to be carried out for this purpose. For example, in large companies when many proxy votes are expected to be lodged with the secretary before a general meeting, a returning officer may be appointed to carry out this task. A secretary may request the assistance of the committee in carrying out an investigation. In the end, however, it is for the chairman of the general meeting to determine which nominations will go forward. In arriving at that conclusion he or she will no doubt be influenced by the opinion of the secretary and the result of any investigation carried out in relation to the validity of the nominations. 10 While r 14(6) provides that the committee is to determine the usual and proper manner for the conduct of a ballot for the election of committee members, that does not vest in the committee an entitlement, generally, to determine the procedures of the general meeting. Likewise, the power of the committee to manage the affairs of the association under r 12(c) does not remove from the chairman of a general meeting the duty to determine the procedures to be followed at the meeting. That is a function of a general meeting and r 12(b) excludes from the ambit of the committee, functions required by the rules to be exercised by a general meeting. 11 In my view, therefore, it was not the function of the committee to exclude the nominations of Messrs Grose and Derwent from consideration by the adjourned annual general meeting. If those nominations are to be excluded, that will be done by the chairman after exercising his or her power in a proper manner. 12 The rules provide that the president or in the president's absence, a vice president, shall preside as chairman at each general meeting of the defendant. It may well be that the chairman of the adjourned annual general meeting will take the same view as the committee did. 13 There appear to be suggestions of other reasons for exclusion of the nominations. Reference was made at the meeting to the Associations Incorporation Act 1984, s 68 which makes it an offence to submit a document to a general meeting that makes a statement that, to the person's knowledge, is false or misleading in any material particular. Upon that issue I do not comment. I mention it simply to point out that the question whether the nominations were valid is a matter for the chairman of the adjourned meeting. It is not one that I can determine on the limited material that is before me. No argument was advanced with respect to the other reasons for rejecting the nominations. 14 I therefore decline to make the declaration sought by the plaintiff as to the validity of the nominations. 15 Whatever the view of the committee, as I have said I am of the view that the chairman of the adjourned meeting has the duty to determine whether the nominations are valid. It was not for the committee to determine that issue. 16 I make the declaration sought in par 2 of the amended summons. I otherwise dismiss the summons. I will hear the parties on costs. **********