Supreme Court New South Wales Medium Neutral Citation: Ovchinnikov v Russian Sports & Social Club Inc [2012] NSWSC 828 Hearing dates: 3 July 2012 Decision date: 03 July 2012 Before: White J Decision: Refer to paras [29] and [31] of judgment. Catchwords: ASSOCIATIONS AND CLUBS - incorporated associations - requirements pursuant to Associations Incorporations Act 2009 (NSW) (the Act) - whether defendant required to keep accounts and minutes of proceedings in English language - whether plaintiff entitled to mandatory injunction to require keeping of such documents - plaintiff entitled to provision of English translation of documents brought into existence after commencement of the Act - held no requirement for translation to be provided by duly accredited translator Legislation Cited: Associations Incorporation Act 2009 Civil Procedure Act 2005 Corporations Act 2001 (Cth) Evidence Act 1995 Cases Cited: King v Goussetis (1986) 5 NSWLR 89 Category: Interlocutory applications Parties: Mihail Ovchinnikov (1st Plaintiff) Peter Rodionov (2nd Plaintiff) Russian Sports & Social Club Inc (1st Defendant) Nadia Lavrova (2nd Defendant) Frederick Lelekov (3rd Defendant) Alexey Morozoff (4th Defendant) Paul Nazarenko (5th Defendant) Peter Parmonov (6th Defendant) Alexey Piatkov (7th Defendant) Konstantin Tonkikh (8th Defendant) Mark Tonkikh (9th Defendant) Representation: Counsel: M Foley, solicitor (Plaintiffs) S Brennan (Defendants) Solicitors: Foley Solicitors (Plaintiffs) MacElbing Mednis & Associates (Defendants) File Number(s): 2011/63213 Judgment 1HIS HONOUR: By notice of motion filed on 26 June 2012 the plaintiffs seek the following orders: 1. The First Defendant translate all of its books and records from the Russian language into English and provide with that translation a proper certificate confirming that translation by a duly accredited translator; 2. This matter be referred to Court appointed mediation. 2On 26 February 2012 the plaintiffs' solicitor wrote to the defendants' solicitor identifying the class of documents which the plaintiffs purportedly required to be translated into English. The first defendant is an incorporated association whose affairs are now regulated by the Associations Incorporation Act 2009. 3The plaintiffs claim that the affairs of the first defendant are being improperly conducted by the second to ninth defendants. They complain that the membership of the first plaintiff with the first defendant was wrongfully suspended and that the second plaintiff was wrongfully dismissed as president of the first defendant and as a committee member. The plaintiffs allege breaches of fiduciary duty and oppressive conduct on the part of the second to ninth defendants. 4The proceedings are listed for hearing on 31 October and 1 November 2012. The Club minutes and other documents have been prepared in the Russian language. This, perhaps, might be thought not surprising given that the first defendant is the Russian Sports and Social Club Incorporated ("the Club"). It would be natural that at least many of the members would read and speak Russian. 5The plaintiffs say that pursuant to s 50(3) of the Associations Incorporation Act the books and records of the club are required to be translated into English or English translations kept. The plaintiffs contend that they should be provided with an English translation of a wide variety of documents. These include not only minutes of meetings of the Committee of Management and all annual general meetings or special general meetings of the Club, but also agendas, notices of meetings, correspondence between the club and the Russian government concerning provision of moneys to the Club, correspondence and other documents between the Club and the Russian Orthodox Church concerning a proposed sale or transfer of the Club or some of its assets to that body, correspondence concerning the present proceedings, and all applications that the Club has received for membership and its response to those applications. 6On this application the plaintiffs read an affidavit sworn by Mr Fred Lelekov of 15 June 2012. He deposes that he is the treasurer and a member of the Club. He exhibits to his affidavit a number of the records of the club, including minutes, and deposes that those minutes have been prepared in the Russian language. Mr Lelekov has provided his translation of parts of those minutes, they presumably being the parts of the minutes on which the defendants propose to rely on the hearing of the matter. Not all of the documents contained in the exhibit have been translated by Mr Lelekov and there is no translation provided by a translator with credentials that are recognised by a Government authority, or at least I have not been referred to any. 7Section 50 of the Associations Incorporation Act provides: "50 Keeping of accounts and minutes of proceedings (1) An association: (a) must keep records that correctly record and explain its financial transactions and financial position, and (b) must keep minutes of the proceedings of its committee meetings and general meetings. Maximum penalty: 5 penalty units. (2) In the case of a Tier 1 association within the meaning of Division 1, the records referred to in subsection (1) (a) must be sufficient to enable financial statements to be prepared in accordance with the Australian Accounting Standards. (3) If any document required to be kept under this section is, either in whole or in part, in a language other than the English language, a copy of the document wholly in the English language must be kept with the document. (4) The regulations may make provision for or in respect of the keeping and inspection of records and minutes under this section." 8The plaintiffs rely upon subsection 3. Two questions will arise in relation to the plaintiffs' reliance on this section. First, what documents are required to be kept in a language other than English or in respect of which a copy in the English language must be kept? Secondly, whether the plaintiff is entitled to a mandatory injunction to require the provision or keeping of such documents. 9The first basis upon which the plaintiffs say that they are entitled to the relief sought in paragraph one of the notice of motion is by seeking to enforce s 50(3) of that Act. The second basis upon which the plaintiffs seek that relief is, I assume, s 61 of the Civil Procedure Act 2005. Under that section the court can give such directions as it thinks fit for the speedy determination of the real issues between the parties in the proceedings. 10The Associations Incorporation Act commenced, I am told, on 1 July 2010. I assume that to be correct as I have not been advised to the contrary. It is common ground that prior to the passing of this Act there was no requirement that documents be kept in the English language. Section 50(1) refers only to a limited class of books and records that might be kept by an association. Section 50(1) refers only to the keeping of records that record and explain the association's financial transactions and financial position and the minutes of proceedings of its committee or all general meetings. Moreover, the section does not have retrospective operation, or at least I have not been referred to any section of the Act that would give it a retrospective operation. 11However, the first defendant is required to keep at least a translation in English of what I might call its financial records. That is to say, records that explain and record its financial transactions and financial position. There is the same requirement for all minutes of proceedings of its committee and all general meetings of members. 12Section 50(3) does not require all of the documents which are the subject of the plaintiffs' application to be translated into English. However, it does require some such documents to be kept and translated. 13The second question is whether the plaintiffs can obtain a mandatory interlocutory injunction to require the provision of such translations. I received no assistance from either of the parties in relation to this question. For the plaintiffs it was simply said that the court could make orders enforcing the Association's obligations under s 50(3). For the defendants it was said that that was not so and that it would be a matter for the Director General or, perhaps, some other body to enforce the section if an offence were involved, or if such third-party could otherwise do so. 14Section 95(3) of the Associations Incorporation Act provides that s 95(1) does not operate to exclude the operation of s 1324 of the Corporations Act 2001 (Cth). Section 1324 of the Corporations Act empowers a court, amongst other things, to grant prohibitory or mandatory injunctions where a person has engaged, is engaged or is proposing to engage in conduct that constitutes a contravention of that Act. However, at least in the absence of argument to the contrary, I don't think that that section confers power to grant an injunction requiring the remedying of a contravention of the Association Incorporations Act. 15In King v Goussetis (1986) 5 NSWLR 89 McHugh JA (with whom Hope JA agreed and with whom Kirby P generally agreed), said (at 93-94) that: "... even when a statute does not confer any private right on an individual to enforce a statutory obligation, a court of equity in a proper case will lend its aid to the enforcement of the statute at the suit of a person who has 'a special interest' in its enforcement. The special interest must be an interest over and above that held by ordinary members of the public ...". (Citations of authority omitted.) 16I express no view on whether the Act confers a private right on an individual to enforce the statutory obligation. Whether or not it does, it is clear that the plaintiffs have a special interest to enforce the obligation under s 50(3). 17It is common ground that the second plaintiff is a member of the Association. The first plaintiff also claims to be a member and says that the purported suspension of his membership is invalid. It is clear that the members are the persons for whose benefit the Associations is required to keep the specified documents in the English language, or to keep a translation in the English language. It may be that the present application should have been brought by summons rather than by notice of motion in the existing proceedings but no complaint is made about that. 18In the interests of the just and quick determination of this issue I am satisfied that although the relief sought is more than interlocutory relief, I should deal with the application as it is presently framed. The plaintiffs do not seek an order requiring the defendants to keep records in the English language but rather to provide them with copies in the English language. Had records been kept, as they should have been from 1 July 2010, then the plaintiffs would have been able to inspect them in the course of carrying out the interlocutory steps that have been taken in these proceedings and to obtain copies of the documents in the English language. 19In my view, on the basis of s 50(3) of the Associations Incorporation Act the plaintiffs are entitled to an order requiring the provision to them of an English translation of documents of the Association brought into existence after 1 July 2010 that: (a) that correctly record and explain the first defendant's financial transactions and financial position and (b) minutes of the proceedings of its committee meetings and general meetings, insofar as such documents otherwise fall within the terms of the plaintiffs' request of 26 February 2012. 20The plaintiffs also seek an order that there be provided a translation with a proper certificate by a duly accredited translator. There is no such requirement under the Act. The question then is whether pursuant to s 61 of the Civil Procedure Act I should require the provision of a translation which has been certified by a duly accredited translator, and whether I should require provision of a translation of other documents the subject of the plaintiffs' request. 21There is no evidence that the plaintiffs are not themselves fluent in the Russian language. As the second plaintiff was the president of the Club, I would assume, in the absence of evidence to the contrary, that he is so fluent. I do not consider that the interests of speedy determination of the real issues in a way that is just, quick and cheap should require the defendants to go to the expense of providing a certified translation of documents, nor requiring a translation of documents that are not required to be translated by reason of s 50 of the Associations Incorporation Act. 22Mr Lelekov has provided a translation of some parts of documents that are in Russian that are exhibited to his affidavit. It will be a matter for the trial judge to decide whether the absence of a certified translation by a duly accredited translator means that the documents exhibited to Mr Lelekov's affidavit are inadmissible. 23Likewise, it will be a matter for the trial judge to decide whether the fact that only parts of the document in the exhibits have been translated means that the documents are inadmissible, or should be excluded pursuant to s 135 of the Evidence Act 1995, or whether orders should be made under s 136 as to the use to be made of the evidence. 24There is no evidence that the plaintiffs are not themselves able to understand and, indeed, to translate the documents exhibited to Mr Lelekov's affidavit and provide such translation to their solicitor. I do not think that the defendants can be compelled to incur the costs of such a translation. If there is a risk that without such a translation the exhibit or parts of it may be inadmissible, that is a risk the defendants run. 25Accordingly, and subject to any submissions that counsel may make in due course in relation to the form of the order, the order that I propose in relation to the claim for relief in paragraph 1 of the notice of motion is that within 28 days the first defendant provide to the plaintiffs an English translation of such of the documents falling within the notice dated 26 February 2012 from Foleys Lawyers to Aviars Mednis of MacElbing Mednis & Associates, as were brought into existence after 1 July 2010 and are: (a) records that record and explain the financial transactions and financial position of the first defendant; or (b) minutes of proceedings of its committee or of general meetings. 26The second issue raised by the notice of motion is whether the matter should be referred to a court-appointed mediation. The defendants oppose that course. They say that mediation would serve no useful purpose. They say that the plaintiffs are publishing various defamatory statements although I have no evidence about that allegation. 27It is clear from the terms of the statement of claim that emotions in this matter are running high. I have been told that mediation through a community justice centre was attempted before the proceedings were commenced and that attempt failed. Having regard to the fact that mediation has been attempted and has failed, and what I am told is the defendants' position in relation to mediation, I don't think that mediation would serve a useful purpose. Not to hold a further mediation would not, of course, prevent the parties from negotiating a resolution of this dispute. That course is to be encouraged. But if the parties' positions are so entrenched as they appear to be and that negotiation is unfruitful, then I think it better in the long-term interests of the Association that the present allegations be aired and determined. 28I decline to make the orders sought in paragraph 2 of the notice of motion. 29I order that within 28 days the first defendant provide to the plaintiffs an English translation of such of the documents falling within the notice dated 26 February 2012 from Foleys Lawyers to Aviars Mednis of MacElbing Mednis & Associates, as were brought into existence after 1 July 2010, being: (a) records that record and explain the financial transactions and financial position of the first defendant; or (b) are minutes of proceedings of its committee or of general meetings. [Parties addressed on costs.] 30The costs of the notice of motion should be costs in the proceedings and neither the plaintiff's costs in the proceedings, nor the defendants' costs in the proceedings. Neither party has been wholly successful. The plaintiff has had some measure of success and whilst it is not as great as the plaintiffs sought, there is no evidence that the defendants offered to do what I have found they ought to do. 31I order that the costs of the notice of motion filed on 26 June 2012 be costs in the proceedings. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 23 July 2012