Supreme Court New South Wales Medium Neutral Citation: Tsoukaris v Royal Motor Yacht Club of New South Wales Limited [2012] NSWSC 1190 Hearing dates: 20, 21 October 201123 November 2011 Decision date: 08 October 2012 Before: McCallum J Decision: Proceedings dismissed Catchwords: ADMINISTRATIVE LAW - procedural fairness - requirements of procedural fairness where member of club facing expulsion CORPORATIONS LAW - oppression Legislation Cited: Corporations Act 2001 (Cth) Cases Cited: Australian Football League v Carlton & Ors Football Club Limited & Anor [1998] 2 VR 546 Australian Workers' Union v Bowen (No 2) (1948) 77 CLR 601 Battle v Bundagen Co-Operative Ltd (No 2) [2011] NSWCA 38 Cains v Jenkins (1979) 28 ALR 219 Dale v New South Wales Trotting Club Ltd [1978] 1 NSWLR 551 Maloney v New South Wales National Coursing Association Ltd [1978] 1 NSWLR 161 Meyers v Casey [1913] HCA 50; (1913) 17 CLR 90 McNab v Auburn Soccer Sports Club Limited [1975] 1 NSWLR 54 Mitchell v Royal New South Wales Canine Council Limited [2001] NSWCA 162 Stead v State Government Insurance Commission [1986] HCA 54; (1986) 161 CLR 141 T.O Supplies (London) Ltd v Jerry Creighton Ltd [1952] 1 KB 42 Whittle v Australian Miniature Pony Society Inc (1995) 57 FCR 252 Category: Principal judgment Parties: Nicholas Tsoukaris (plaintiff) Royal Motor Yacht Club of New South Wales Ltd (defendant) Representation: Counsel: M McHugh (plaintiff) C Sweeney QC (defendant) Solicitors: Davis Legal (plaintiff) Gells Lawyers (defendant) File Number(s): 2010/320348 Publication restriction: None Judgment 1HER HONOUR: Mr Nicholas Tsoukaris was a member of the Royal Motor Yacht Club of New South Wales from 1995. He had a berth for his vessel "Tainui" at the Club's marina at Point Piper from October 2000. He paid a capital sum of about $9000, together with monthly fees, for the licence of the berth. There is now a waiting list of many years for new berths at the Club. 2On 23 August 2010, Mr Tsoukaris was expelled as a member of the Club and required to remove his vessel from its berth. The decision was made on the strength of a finding that guests in the company of Mr Tsoukaris had boarded a fellow member's vessel from the marina and removed property (two bags of ice) belonging to that member. 3Mr Tsoukaris contends that the disciplinary process against him was flawed in that he was denied procedural fairness. He invokes the jurisdiction of the court at common law and under the Corporations Act 2001 (Cth) to prevent the implementation of the Club's decision. 4The existence of the court's discretionary power at common law to intervene in the affairs of a voluntary tribunal has long been recognized, notwithstanding an absence of consensus as to the source of that jurisdiction: see Mitchell v Royal New South Wales Canine Council Limited [2001] NSWCA 162 at [34] to [39] per Ipp AJA, Mason P and Stein JA agreeing. At times identified as having its foundation in contract, the jurisdiction has equally been characterised by reference to broader notions of justice and fair process in the protection of private rights or interests. 5In Mitchell, the Court of Appeal cited with apparent approval the following description of the circumstances in which the court will intervene, stated by Tadgell JA in Australian Football League v Carlton Football Club Limited [1998] 2 VR 546 at 550: Statutes aside, the courts have been disposed to interfere in a limited way with decisions of private or domestic tribunals in order to protect private rights that have been adjudged to deserve protection, including rights in property. The concept of property has been broadly interpreted for this purpose and, in cases within that category, I believe that there is no decision of a private or domestic tribunal with which the courts will refuse to interfere if interference be considered necessary for the attainment of justice. 6The ground for invoking the court's power to grant relief under the Corporations Act is the contention that the Club's resolution was oppressive or unfairly prejudicial within the meaning of s 232 of the Act. It was indicated at the hearing that the relief sought on that basis is founded on the same allegations of denial of procedural fairness as are relied upon to found the relief sought at common law. Mr Tsoukaris expressly abandoned a separate ground under s 232 that the decision was oppressive in substance (T82.15). 7In the same vein, although the orders sought in the statement of claim were framed in a variety of separate ways, all were acknowledged to be directed in effect to having both the expulsion decision and the decision requiring removal of the vessel from the berth quashed on the grounds of denial of procedural fairness (T16.35) 8The Club denies any failure to afford procedural fairness to Mr Tsoukaris. It further contends that he is in any event estopped from denying the validity of his expulsion because he invoked his entitlement under the Club's Articles of Association to seek a review of the decision. The Club also relies upon allegedly dishonest conduct on the part of Mr Tsoukaris when first confronted with the disciplinary complaint as pointing to the likelihood that his later absence from the disciplinary process was due to a deliberate decision on his part, and not due to any want of notice of the relevant meeting. The Club further relies upon alleged lies told by Mr Tsoukaris during the course of these proceedings as a basis upon which the Court should decline to exercise the discretion to intervene, in the event that a basis for the relief sought is otherwise established. Requirements of procedural fairness 9A member of a sporting or social club charged with a departure from the rules of the club and facing expulsion or other detriment, in circumstances where the rules of the club permit him to attend a meeting and answer charges against him, is entitled to procedural fairness and the rules of natural justice attach to the misconduct proceedings: McNab v Auburn Soccer Sports Club Limited [1975] 1 NSWLR 54 at 59E per Needham J. 10It is important, however, to bear in mind that the authority of such proceedings over members has its juridical foundation in contract. The significance of that feature of disciplinary proceedings before a board such as the board of the defendant Club was explained by Dixon J in Australian Workers' Union v Bowen (No 2) (1948) 77 CLR 601 at 628: It is important to keep steadily in mind that we are dealing with a domestic forum acting under rules resting on a consensual basis. It is a tribunal that has no rules of evidence and can inform itself in any way it chooses. Members may act upon their own knowledge and upon hearsay if they are satisfied of the truth of what they so learn and if they give the member with whom they are dealing a proper opportunity of answering the charge and defending himself. 11Mr Tsoukaris submitted that the evidence in the present case firmly establishes that he was denied procedural fairness in two respects. First, it was submitted that there was a breach of the hearing rule in that Mr Tsoukaris was not given due notice of the meeting at which his expulsion was to be considered and, accordingly, was not heard on the issues to be considered at that meeting. Secondly, it was submitted that there was a breach of the bias rule in that two of the members of the board who voted at the meeting were involved in the underlying incident and the instigation of the disciplinary process, and so were precluded from voting on the expulsion resolution. 12Those contentions fall to be assessed in the context of the relevant provisions of the Club's Articles of Association and, in particular, the disciplinary powers of the board set out in clause 96, as follows: Disciplinary powers of the Board 96.The Board for the purpose of ensuring the strict adherence by the members to the provisions of the Memorandum and Articles of Association or any rules, by-laws or regulations prescribed thereunder and for the purpose of preserving the good name and reputation of the Club and ensuring the smooth and unobstructed executing of its duties shall have disciplinary powers exercisable in the circumstances and in the manner following: On receiving a complaint or on becoming otherwise aware that a member: (a) wilfully infringes the provisions of the Memorandum and Articles of Association or any rules, by-laws or regulations made thereunder; or (b) acts in a manner prejudicial or detrimental to the interests of the Club or in a manner obstructing the progress or effectiveness of the Board's work; or (c) conducts himself on the premises of the Club or in the precincts thereof or in functions or gatherings of people to which he attends on behalf of the Club or by virtue of his being a member of the Club, in the manner which reflects discredit to the Club or which is objectionable to other members or their guests or to his hosts; or (d) ignores or defies any reasonable direction fo the Board or its duly authorised officers of Committeemen or employees in the execution of their duties; or (e) being a member of the Board of if [sic] a Committee is guilty of gross negligence of duty or of breach of confidence; may summon such member to appear before it in order to give an explanation, if any, of what is alleged against him, and if such explanation is unsatisfactory and not less than seven (7) of its members consider that the allegations against the member concerned are well founded, may in case of a minor offence, reprimand such member or reprimand and also fine him for an amount not exceeding that of his annual subscription as provided in Article 95(c) concerning the determination of levies or suspend the privileges of membership for such period as it thinks fit but not more than six (6) months. If however the aforesaid seven (7) members of the Board are of the opinion that the offence committed is of such gravity as to deserve a severe punishment involving his expulsion from the Club it shall adjourn the meeting dealing with the subject matter for a period of not less than fourteen (14) days in order to afford the member a further opportunity to explain or defend his conduct before a final decision is made. A notice in writing of at least seven (7) days shall thereupon be given to the member of the place, date and time of the meeting inviting him to attend thereat, if he so desired and once again either verbally or in writing offer an explanation in his defence. Such notice shall also state the intention of the Board to decided upon his punishment, shall reiterate the allegations made against him and shall draw his attention to his right to elect for his case to be dealt with by General Meeting of the Club instead of being dealt with by the Board. If the member fails to exercise his right of election as above by notice in writing delivered to the Secretary not less than twenty four (24) hours before the time appointed for the meeting and also fails to attend at the said meeting, a resolution of the Board carried unanimously at the meeting at which a quorum shall be not less than seven (7) members, of the guilt or innocence of the member and in the former case his expulsion from the Club shall be final and effective as from that date. In the event, however, of the accused member electing by a notice as aforesaid to have his case referred to a General Meeting of the Club for its decision, the Board shall at the earliest convenient time convene an Extraordinary General Meeting for that purpose. A resolution of such Extraordinary General Meeting carried by the vote of not less than three-fourths of the members present and having the right to vote shall be a final determination of the case, and if the member is found guilty, he shall be expelled from the Club. Scope of the present inquiry 13Before turning to consider the evidence relating to Mr Tsoukaris's contentions, it is appropriate to note a preliminary issue as to the relevance of one aspect of the evidence. 14Some explanation is required. As at April 2010, the vessel berthed next to "Tainui" was "Big Buddy", owned by Mr Keith Snr, who was also a member of the Club. The substance of the complaint against Mr Tsoukaris is that guests of his boarded Big Buddy one evening and removed bags of ice from its freezer. The Club alleges that the men were stopped by the Rear Commodore of the Club, Mr Michael Tess, and ordered off the boat. Mr Tsoukaris accepts that one of his guests, a Mr Allombert, boarded Mr Keith's boat. Mr Tsoukaris says that Mr Allombert did so without consulting Mr Tsoukaris. 15Mr Tess reported his version of those events to the Commodore of the Club, Mr John Barbouttis. Mr Barbouttis contacted Mr Keith Snr, who told him that Mr Tsoukaris was not authorised to board Big Buddy. Mr Barbouttis suggested to Mr Keith Snr that, although the incident only concerned bags of ice, it involved stealing. He asked whether Mr Keith Snr was "willing to make the complaint" (affidavit of John Barbouttis sworn 17 March 2010 at paragraph 6). Mr Keith Snr stated that he was. 16The Club then sent a letter to Mr Tsoukaris informing him of Mr Keith's complaint and requesting that he attend the next meeting of the board of directors to show cause why his membership and boating privileges should not be withdrawn. 17Mr Tsoukaris attended the meeting of the board on 9 June 2010. Mr Keith Snr was overseas at that time. There is a dispute as to what happened at the meeting. The Club alleges that Mr Tsoukaris distributed copies of an email dated that day purportedly sent to him by Mr Keith Snr. The email "confirmed" that Mr Tsoukaris had access to Big Buddy "for the purpose of keeping your ice bags in my freezer". The email purportedly expressed Mr Keith's dismay at the board's overreaction to the incident. 18In light of the inconsistency between the content of the email and Mr Keith's earlier statement that he wished to pursue a complaint against Mr Tsoukaris, the meeting of the board was adjourned to enable further inquiries to be made of Mr Keith Snr following his return from overseas. 19Mr Tsoukaris denies distributing the email and denies ever having seen it before receiving the Club's affidavits in these proceedings. He gave evidence that the only email he distributed at the meeting was an email from himself apologising to the board in respect of the ice incident. 20A "furious" Mr Keith Snr later informed the Club that the email was a forgery and that Mr Tsoukaris had no authority to board his boat at any time (affidavit of John Barbouttis sworn 17 March 2010 at paragraph 12; affidavit of John Keith sworn 7 October 2010 at paragraphs 4-5). Mr Tsoukaris did not suggest otherwise, volunteering in cross-examination that the email was "all lies" (T132.10). However, he disclaimed any knowledge of the provenance of the email. For convenience, and because it was not ultimately a matter in dispute, I will refer to it as the forged email. 21The events which followed are considered in detail below. For present purposes it is enough to record that Mr Tsoukaris was not present at the meeting of the board on 23 August 2010 at which the expulsion resolution was passed. 22The preliminary issue relates to the relevance of the forged email in these proceedings. Mr Tsoukaris contends that the forged email is wholly irrelevant to any issue required to be determined by me. As already noted, his application is founded on alleged breaches of the hearing rule and the bias rule. Mr Tsoukaris submits that the proceedings are confined to the determination of those contentions and that they cannot be informed by the circumstances surrounding the forged email. 23I do not accept that submission. I accept, as submitted on behalf of Mr Tsoukaris, that a claim of denial of procedural fairness is no warrant for an inquiry into the merits of the impugned decision. That is not to say, however, that administrative law proceedings raise no issues of fact. In the present case, the complaint of breach of the hearing rule raises an issue of fact as to whether Mr Tsoukaris had notice of the meeting of the board at which his expulsion was to be considered. He says he did not. The Club asks the Court to find that Mr Tsoukaris chose not to face that meeting, his forgery of the email having been uncovered. 24Mr Michael McHugh, who appeared for Mr Tsoukaris, relied on the decision of the High Court in Meyers v Casey [1913] HCA 50; (1913) 17 CLR 90. In that case, a member of the Victoria Racing Club was threatened with expulsion after stewards concluded that a horse owned by him "did not try to win". The judge at first instance had dismissed an application for declaratory and injunctive relief in respect of that threat on the basis that the plaintiff, "in seeking the assistance of equity, did not come into Court with clean hands". That conclusion was evidently based on an assessment of the conduct of the plaintiff that had prompted the threat of expulsion. The High Court noted, unexceptionably, that the merits of the plaintiff's conduct were not in issue in the proceedings and could not be taken into account in determining whether to grant the relief sought: at 101-102 per Barton ACJ; at 123-124 per Isaacs J; Powers J (in dissent) agreeing on that issue at 147.9; Rich J agreeing with Isaacs J at 148. 25The decision in Meyers v Casey thus provides support, if it were needed, for the proposition that judicial review of the action of a voluntary tribunal is concerned only with the validity, and not the factual correctness, of the impugned decision. However, as noted by Isaacs J in Meyers v Casey at 124.2, the position will be different where the right sought to be vindicated "is itself to some extent brought into existence or induced by some illegal or unconscionable conduct by the plaintiff". 26In my view, an evaluation of the evidence concerning the forged email must be undertaken, for two purposes. First, the Club relies on that evidence as informing the determination of issues of fact raised by Mr Tsoukaris's present application, namely, whether he did receive notice of two further meetings of the board (including the meeting on 23 August 2010 at which the expulsion resolution was carried). The Club's case is that he did receive notice, but chose not to attend those meetings because his forgery had been uncovered. In my view, the evidence as to the forged email is plainly relevant to those issues. 27Secondly, in the peculiar circumstances of this case and for the reasons explained below, I consider that the decision whether I should exercise the discretionary powers invoked by the application is properly informed by an evaluative assessment of the evidence given before the Court by Mr Tsoukaris. 28Against that analysis, it is necessary to consider the circumstances of the following matters in some detail: (i) the terms of the exchange between Mr Tess and Mr Tsoukaris after Mr Allombert boarded Mr Keith's vessel; (ii)whether Mr Tsoukaris distributed the forged email at the board meeting of 9 June 2010; (iii)the content and circumstances of various communications between Mr Tsoukaris and the board after 9 June 2010. The exchange on the marina 29As already noted, it is common ground that Mr Allombert, as a guest of Mr Tsoukaris, boarded Big Buddy to get some bags of ice. He was observed by Mr Tess, who ordered him off the boat. Mr Tess then confronted Mr Tsoukaris, alleging that he had observed and heard Mr Tsoukaris directing Mr Allombert and another guest to take two bags of ice from Big Buddy's freezer. 30In his first affidavit (sworn 24 September 2010), Mr Tsoukaris gave the following evidence as to that incident: 6.On Saturday 10 April 2010 I was about to leave to go fishing on my boat in the company of various guests. One of the guests was Charlie Allombert. At about 7:30pm that night before departing the marina, Mr Allombert stepped onto a vessel berthed on the marina opposite my vessel and known as 'Big Buddy'. I do not know why Mr Allombert took this action and he did this without any reference to me. However, he had been present on my boat a few weeks earlier when the son of the owner of 'Big Buddy' loaned me two bags of ice because the Club bar facilities were closed at an unusually early hour. I had told Mr Allombert that I replaced the two (2) bags of ice the following Saturday with eight (8) bags of ice and had later rung the skipper of 'Big Buddy', John Keith to advise him what I had done. I had known and been an acquaintance of Mr Keith for about ten years at the Club. 7.Mr Allombert did not enter the cabin of the vessel but rather stepped into the open cockpit at the rear of the vessel. I believe that he then stepped off the vessel almost immediately and took nothing with him. He was observed doing this and then confronted at the boat by a Mr Tess, the Rear Commodore of the Club. I observed that Mr Tess was aggressive, I then realised what had happened in the confusion. I said to Mr Tess words to the effect, 'Can you please calm down.' He said, 'Why are you on the boat? What are you doing? How dare you get on somebody else's boat.' I said to him words to the effect, 'I was not on the boat please calm down and stop shouting. My guest should not have been on the boat but he was only on it for a few seconds.' The Rear Commodore then tried to ring the owner of 'Big Buddy' and left a message. I do not know what was said. I then said to him, 'We all know each in the marina and apologise for any misunderstanding [sic]. I know he is not allowed on that boat.' 31Mr Tsoukaris denied the substance of Mr Tess's conflicting account of the incident (set out in full below). Mr Tsoukaris also stated that he estimated Mr Tess to be approximately 35 metres away from the berth. He denied that Mr Tess could have overheard from that distance any conversation between Mr Tsoukaris and his guests. 32In a further affidavit sworn on 12 April 2011, Mr Tsoukaris asserted that he had "a friendly arrangement with John Keith Jnr" that he was allowed to borrow ice from his father's boat. Mr Tsoukaris described an earlier occasion on which he had done so. He stated that he saw Mr Keith Jnr on Big Buddy and said to him: "John, do you have any spare ice as the Club is shut?" He stated that Mr Keith Jnr replied, "Let me have a look, I've only got one bag but I'll check the ice maker". He stated that Mr Keith Jnr then collected two bags of ice and handed them to him. 33However, Mr Tsoukaris agreed in cross-examination that, as at 10 April 2010, he and his guests were not entitled to go onto Mr Keith Snr's boat and take ice. He accepted that they would be acting improperly if they did so (T35.37). He said that he did not intend for his evidence in the affidavit sworn 12 April 2012 to be used to justify his guests' conduct on 10 April 2010, since that would only be relevant "with John Keith present". He repeated the assertion that he had apologised to Mr Tess on the marina for what had happened. 34Mr Allombert gave the following account of the incident (affidavit sworn 13 April 2011): 3At about dusk, before we departed the Marina, I boarded the adjacent vessel known as 'Big Buddy'. I did so with the intention of obtaining some ice for our evening cruise. I did not ask Nicholas Tsoukaris whether I should do so because some weeks previously I was in his company when he asked a person on Big Buddy for the loan of some ice. On that previous occasion the person on the boat appeared to be on good terms with Nicholas and readily handed over two bags of ice. 4On Sunday 11 April 2010 I had no sooner boarded Big Buddy when I heard a voice, apparently talking to me. The person, in civilian clothes, whom I did not recognise said to me words to the effect, 'Get off this boat'. I was initially shocked as I did not recognise the person and he seemed to be yelling at me in a most aggressive manner. Without saying anything to him I immediately left the vessel. I had not located any ice on the vessel and I did not remove any. I was the only person on the vessel. 35Mr Allombert sent a letter to the Club's board of directors dated 30 August 2010 apologising for boarding the vessel and asserting that Mr Tsoukaris did not instruct him to do so (exhibit A). 36In cross-examination, Mr Allombert said that he did hear the conversation between Mr Tsoukaris and Mr Tess that took place after he left the boat, but was not sure whether or not Mr Tsoukaris told Mr Tess that he had permission to go onto Mr Keith's boat. He explained that he was in shock after the way Mr Tess came up to him (T49). 37Mr Tess gave a different version of events, as follows (affidavit sworn 7 October 2010): I heard [Mr Tsoukaris] tell two of his guests to board Mr John Keith's vessel which was moored in pen 32. I saw [Mr Tsoukaris] gesture towards Mr Keith's boat, which was directly opposite and heard [Mr Tsoukaris] say to them words to the effect, 'Get two bags of ice from the rear freezer and bring them here.' I saw the two men board Mr Keith's boat and immediately said to these two people, 'Please get off Mr Keith's boat. Do not touch or remove anything from the boat.' I also said to them, 'I am the Rear Commodore in charge of the marina.' Immediately following my statement to the two men, [Mr Tsoukaris] standing at the rear of his boat, yelled out to them whilst they were still on Mr Keith's boat: 'Remove the ice and bring it here.' He then said to me, 'Don't you make an ass of yourself and be an idiot.' He said to me words to the effect, 'They are my bags of ice in the freezer and I made arrangements to take the ice off the boat.' As Rear Commodore, I telephoned the Keith family boatman whose name is Gavin. I asked Gavin whether the previous instructions from Mr John Keith about no one having permission to go on the boat had changed and he told me that they had not changed. Prior to the incident, I had had conversations with John Keith Jnr and Gavin. I was instructed by them as the Rear Commodore that under no circumstances was anybody allowed on their vessel. I was also informed by them that Mr Keith Snr had requested Gavin to put an alarm on the boat freezers to deter people from taking ice out of it. 38In re-examination, Mr Tess stated that there was nothing unusual about being able to hear a conversation from the distance at which he was standing from Mr Tsoukaris's berth, which he agreed was five boat lengths. He said that the marina is very quiet at night (T106.42). 39Mr Keith Jnr gave evidence which contradicted Mr Tsoukaris's account of their so-called friendly arrangement (affidavit sworn 17 March 2010): In or about early March 2010 our boatman Gavin raised concerns with me about ice missing from our eutectic fridges on Big Buddy. Eutectic fridges work more efficiently when they are full of ice and as such we kept our fridges full. On a Monday evening, I'm not sure of the exact date, but I do recall it was a Monday in March I came down the [sic] Marina of the club to discover Nick Tsoukaris on the back of Big Buddy removing bags of ice. I said to him, 'Hey Nick what are you doing?' He said, 'I am just getting some ice we have run out on our boat, I will replace it don't worry.' I said, 'Mate you can't just get on the boat, you know you just can't go onto someone else's boat.' He replied, 'Sorry John don't worry, I will replace the ice.' He then left the boat. I noticed on the back of his boat a large group of people that he was entertaining. I rang Gavin the boatman a couple of days later and asked if any ice had been replaced, no ice has ever been replaced. A few weeks later I again went down to the club to check our boat, and this time I discovered a person on the back of our boat taking ice, and when I told them to get off our boat they went directly to Nick Tsoukaris boat. Nick said to me, 'Sorry John I have run out of ice again I will replace it.' I said to Nick: 'Nick don't get on the boat.' 40Mr Tess's version was to some extent corroborated by a Mr Stephen Geissler, another member of the club who observed the incident. Mr Geissler gave the following evidence (at T139): HER HONOUR Q. That's okay. All you are asked is to repeat what you perceived with any of your five senses rather than saying A. Perceived and saw, two people on a boat which I hadn't seen as before. I saw a, I saw and heard basically a discussion or argument between Mr Tess and the owner of Tainui, which I know boats more than members as such. SWEENEY Q. Is that Mr Tsoukaris? A. Yes, Mr Tsoukaris, yes. Mr Tess was basically saying "Get off the boat" to the other members. Mr Tsoukaris was saying basically, "No. Grab the bags of ice." That, basically, I think it was something like he called Mick an idiot or something equivalent to that. "Don't be an idiot." Mick was quite stern in saying "Get off Big Buddy. You don't have a right to be on it". And from that, that was the altercation. The guys basically dropped, stopped what they did and then got off the boat. Is that... HER HONOUR: All right. SWEENEY Q. Did I understand you to say that you heard Mr Tsoukaris direct the people on Big Buddy to get the ice? A. Yes. The board meeting of 9 June 2010 and the forged email 41As already noted, Mr Tess informed Mr Barbouttis of his version of the incident. Mr Barbouttis then telephoned Mr Keith Snr and had the following conversation (affidavit sworn 17 March 2011): [I said:] 'Michael Tess had an argument with Tsoukaris on Sunday night when some of his guests boarded your boat, I'm sure you're aware of the previous incidents which Mick spoke to Gavin and John Junior about.' He said: 'I am aware of that previous incidents [sic] and the new incident, Tsoukaris is not authorised to go on my boat, Tsoukaris is a thief, we keep losing ice from the boat.' I said: 'John, this is very serious, I know its [sic] only bags of ice but its [sic] stealing. I will be asking the Board to summons Tsoukaris to appear before it and show cause why his membership should not be suspended or otherwise dealt with by the Board under the article of Association, are you willing to make the complaint.' He said: 'Yes I am, he is a thief'. 42Mr Barbouttis convened a board meeting on 27 May 2010 at which he recounted the substance of his conversation with Mr Keith Snr. Mr Tess also gave his account of the incident to the board. The complaint was recorded in the minutes of the board meeting, under the heading "Commodore's Report", in the following terms: A complaint has been received by member John Keith and confirmed by the Rear Commodore that guests in Nicholas Tsoukaris's company had removed property from a fellow member's boat in April 2010. 43The board resolved that a letter be sent to Mr Tsoukaris in accordance with s 96 of the Articles of Association. The letter was sent to Mr Tsoukaris on 28 May 2010 by ordinary prepaid post (affidavit of Ms O'Donnell sworn 7 October 2010 at page 7). It was in the following terms: A complaint has been received by member John Keith and confirmed by the Rear Commodore that on Sunday 11 April at 8.30pm, guests in your company boarded a fellow member's boat and removed property, that being property of a member. Member John Keith Jnr. also witnessed the same incident occurring on another occasion. Under Section 96 of the Articles, the Board request your attendance at the next Board meeting on Wednesday 2 June 2010 at 6.00pm to show cause why your membership and boating privileges should not be withdrawn from the Club. The Board has the power to suspend your membership and remove your vessel from the Marina for the time of your suspension if it is not satisfied with your explanation. This matter will be dealt with in your absence if you choose not to attend. 44Mr Tsoukaris stated during cross-examination that he did not believe he ever received that letter (T28.06). He gave evidence that the next time he gave any thought to the incident was on 8 June 2010 when he received a telephone call from Ms O'Donnell, the secretary of the Club, advising him that he was required to attend a board meeting to discuss the incident (first affidavit at paragraph 9). On that evidence, he may not have been aware, going into the meeting, that Mr Keith Snr had been consulted and made a decision to pursue a complaint. 45The board meeting was scheduled for 9 June 2010. In his first affidavit, Mr Tsoukaris said that, following his phone discussion with Ms O'Donnell and prior to attending the meeting, he sent an email to the Club explaining his position in relation to the matter. He said that he could not locate a copy of that email because his computer had crashed, causing him to lose all of his emails from May to June 2010. He described the email as "an explanation of a friend boarding the boat and an apology and that was really the basis of the letter. It was short and sweet" (T17.22). 46Mr Tess denied that anyone in the Club had ever received an email of apology as described by Mr Tsoukaris (affidavit of Michael Tess sworn 7 October 2010 at paragraph 13). No other member gave evidence of receiving an apology email. 47The Club then served a number of affidavits asserting that, at the meeting on 9 June 2010, Mr Tsoukaris had distributed copies of an email purportedly from Mr Keith Snr confirming that Mr Tsoukaris had permission to go on the boat. Mr Tsoukaris responded to those assertions in his second affidavit (sworn 8 October 2010) by denying that he handed the directors "copies of any email" (at paragraph 10). He said that the first time he had seen the email purportedly from Mr Keith Snr was in his solicitor's office on 8 October 2010, the day on which he swore his second affidavit. 48During cross-examination, however, Mr Tsoukaris said for the first time that he had distributed an email at the meeting, being his apology email (of which he no longer has a copy). He could not explain why he had said in his second affidavit that he did not hand any email to the directors. He repeated that he had handed them a copy of the email of apology he had sent following his phone call with Ms O'Donnell in early June (T19.18). He offered no reason for not providing that information in his first affidavit (T38.44). In cross-examination, he also stated that no one else at the meeting had circulated the forged email in his presence (T44.36). 49As already noted, the Club asserts that the meeting was adjourned to investigate the inconsistency between the position attributed to Mr Keith Snr in the email relied upon by Mr Tsoukaris and Mr Keith's earlier willingness to pursue the complaint. 50After the adjournment of the meeting of 9 June 2010, the board sent a letter to Mr Tsoukaris 16 June 2010 (set out in full below) which said: "Your attendance and presentation of the email from Mr. Keith leave no alternative but to adjourn the meeting until Mr Keith returns from his holiday and have him attend the meeting to explain his position in this matter" (exhibit SOD2 to the affidavit of Ms O'Donnell sworn 7 October 2010 at page 3). Mr Tsoukaris was taken to that letter in cross-examination. He was asked why he took no steps to correct that statement if, as he asserted, he did not distribute an email purportedly from Mr Keith Snr. Mr Tsoukaris responded: "I thought I would have my chance in front of the board in person" (T28.22). 51Mr Tsoukaris otherwise denied the accounts of the board meeting of 9 June 2010 given by the board members and other persons who were present. 52The minutes of the 9 June meeting were taken by the Club secretary, Ms Suzanne O'Donnell, and were exhibited to her affidavit sworn 7 October 2010 (exhibit SOD2 at page 2). It is appropriate to set them out in full: PresentCommodore John Barbouttis Rear Commodore Michael Tess Director Neil Webster Director Michael Zammit Director Richard Poole In attendance:Robert Paridis In accordance with Section 96 of the Articles, Nicholas Tsoukaris appeared before the Board to give an explanation of what is alleged against him. Mr. Tsoukaris produced an email purportedly from John Keith (who is at this time is overseas) alleging that Mr. Tsoukaris had authority to have access to his boat at any time. The meeting was adjourned at 6.05 pm to a date to be fixed when Mr. Keith could attend also. The Vice Commodore arrived at 6.15pm. Discussions ensued in relation to Mr Tsoukaris. The meeting closed at 6.30pm. 53Mr Barbouttis gave the following evidence as to that meeting (affidavit sworn 17 March 2011 at paragraph 9): I thanked Nick for attending and said; "Nick you have received our letter in relation to the incident this meeting is for you to give an explanation of what occurred on the night." Tsoukaris said: "I received this e-mail today from John Keith here is a copy for each of you. It explains everything and confirms I was authorised to go on his boat, and when you've read it you will see that this is a vendetta against me by Michael Tess." He then stood up and proceeded to hand out copies to all of the Board members present and to the Secretary ... He started talking again and I said: "Just hang on Nick, let me read it and let the others read it". After I finished reading the e-mail, I said to Tsoukaris: "This email seems to have been sent to Valerie (his wife) by you, how come?" Tsoukaris said: "I sent it to Valerie's address as my printer was not working at the office and I had her print it before I came here. See this is just a vendetta by Michael Tess." I said: "It is not a vendetta by Michael Tess, but we will have to get to the bottom of this either John Keith is making a fool of us or your [sic] making a fool of us. In the circumstances we will have no choice but to adjourn this matter and send a letter to each of you, that is John Keith and you Nick to explain this. We will write to you when we will hold the adjourned meeting." 54A copy of the email was annexed to Mr Barbouttis' affidavit (annexure B). It appears as an email from Mr Tsoukaris to his wife forwarding an email from "admin@jrk.com.au" sent on 9 June 2010. 55It is appropriate to set out the email in full, exactly as it appears: Dear Nick I am currently organising myself to get out of sydney for europe as you know and cannot be at the club meeting tonight by 6 pm though I did get your message last week the change of times from the office As you know mate I would be there if I could I was somewhat bemused at the clubs actions as we have been fellow members and neighbours on the marina since the club marina was renovated for the Olympics in 2000 Since you called me back in April advising me of the way Mick Tess over reacted when getting on my boat , It doesn't surprise me and by the way I didn't have any missed calls from Mick Tess on that evening of the incident after checking my mobile I cannot believe that they would go to such length and call you to the board as I didn't know it was a crime to go onto fellow members vessels particularly when the club rear commodore knows very well that we have been mates and most importantly we keep and I on each other s boats I hope this letter clarifies the relationship we have with fellow boat members and I confirm that you have access to the boat for the purpose of keeping your ice bags in my freezer , free to come and go as you may wish I would also like to confirm that you have access to my boat at any time and you know where the spare keys are kept on the boat I will personally make a complaint to John Barboutis on my return if this escalates any further and I feel it will be the end of this confusion Ps John Junior say hello and thanks for the tips on Bars in St Tropez where Valerie cousin runs as his already been in touch with him by email last week and has invited us all for drinks on the 18th of June when we are staying in St Tropez. Don't hesitate to present this letter to the board at rmyc and am sorry I cant be there to put the record straight Best regards and good luck 56The email had a footer with the name "John R Keith, Managing Director, John R Keith Group of Companies", contact details and a graphic image of the company's logo. 57Mr Tess gave the following account of the board meeting (affidavit sworn 7 October 2010 at paragraph 16): At the Board meeting on 9 June 2010, [Mr Tsoukaris] handed to each of the members of the board including myself copies of what he said were "copies of an email which I have received from Mr John Keith confirming that I had permission to go no to his boat" [sic]. The board meeting was adjourned to enable inquiries to be made from Mr John Keith. 58Mr Neil Webster recounted the meeting as follows (affidavit sworn 7 October 2010 at paragraph 3): At the meeting, [Mr Tsoukaris] said words to the effect: "Michael Tess is conspiring to get me kicked out of the club. It is rubbish. It was only a few bags of ice." He said: "I was only taking a few bags of ice and John Keith was well aware of the arrangement." He said: "All this for a few bags of ice." He said: "I had the full permission of John Keith to get on his boat and take ice whenever I wanted." He stood up and handed to each of the directors copies of a document, leaving a few extra copies on the table, and said words to the effect: "This is an email which John Keith sent to me confirming that I had authority to go on to his boat". ... A member of the board asked [Mr Tsoukaris]: "why was the email to Valerie Tsoukaris?" [Mr Tsoukaris] said: "I was running late and couldn't get home to my printer so needed to email it to my wife's email and printer." As Mr Keith was overseas at the time, the board resolved to adjourn the meeting until his return and to ask Mr Keith to attend the board on the resumed meeting. 59Mr Paridis, Mr Poole and Mr Zammit also each stated that they were in attendance at the meeting. Each annexed a copy of the same email, which they said was handed around to everyone at the meeting by Mr Tsoukaris (affidavits sworn 16 March 2011, 17 March 2011, and 16 March 2011 respectively). 60Finally, Ms O'Donnell, the Club Secretary, also gave evidence that Mr Tsoukaris distributed the email at the meeting (T128.36): Mr Tsoukaris came into the boardroom. I sat him down. I had a seat at the board table and Mr Tsoukaris distributed it [the email] to all the board members and myself. 61 In short, every person in attendance at the meeting apart from Mr Tsoukaris himself gave sworn evidence that he distributed copies of the forged email at the meeting. 62Mr John Keith (Snr) gave evidence as follows (affidavit sworn 7 October 2010): 4I have been shown a copy of an email said to have been sent by myself to [Mr Tsoukaris]. ... The email is a forgery. 5I have not sent any such email to [Mr Tsoukaris]. 6The footer to the email, whilst it contains my name, contains the details of an administrative assistant in my office, namely her fax number and mobile number, which are different to mine. 7The footer on the email contains a combination of my details and the details of an administrative assistant in my office, namely her fax number and mobile number, which are different to mine. ... 9My company did have some dealings with [Mr Tsoukaris] some years ago. I think the footer to the email may have been the footer which was used by company staff members on emails they may have sent to [Mr Tsoukaris] when purchasing some t-shirts and protective work clothing from a company associated with [Mr Tsoukaris]. 10I have checked in my office to ascertain whether the email was sent by me or anyone else in my office. A search of the computer system shows no record of any such email being sent by me or any other person to [Mr Tsoukaris] in June 2010. 11As to the content of the email, I say I had never given [Mr Tsoukaris] permission to go onto my boat. 63In the proceedings before me, Mr Tsoukaris did not dispute that Mr Keith Snr had not in fact granted him permission to board his boat or to take ice. 64In order to accept Mr Tsoukaris's account of the meeting of 9 June 2010, I would have to accept that all seven of the other persons who attended the meeting were lying or mistaken as to its events. I do not accept that to be the case. Even leaving aside the compelling evidence of those witnesses, the proposition that Mr Tsoukaris circulated the email finds ample support in the events that followed (all of which revolved around the pivot of the confusion created by the forged email) and in the content and form of the emails itself. 65The content of the email mirrors the response which, according to Mr Tess and Mr Geissler, Mr Tsoukaris gave when first confronted about his guest having boarded Big Buddy. In particular, the email trivialises that event; asserts that there was ice in the freezer that in fact belonged to Mr Tsoukaris (not Mr Keith) and purportedly confirms authority for Mr Tsoukaris to board Big Buddy to retrieve his own ice. Interestingly, an assertion attributed to Mr Keith Snr in the email, "most importantly we keep and I on each other s boats (sic)" echoes a remark volunteered by Mr Tsoukaris during cross-examination (at T37.02): "Yes, everybody keeps an eye on each others' boats down there including me". 66As to the form of the email, what is immediately striking is the poor punctuation, including the absence of almost any full stops. In a short and damaging cross-examination by Mr Sweeney on behalf of the Club, Mr Tsoukaris revealed two things about himself which are pertinent in that context. First, given a full opportunity to remark on any unusual feature of the grammar of the email, he did not observe the absence of full stops. Secondly, he produced a bundle of emails composed by himself which display the same feature, containing many sentences and paragraphs poorly punctuated and without full stops (exhibit 1). The proposition that someone other than Mr Tsoukaris forged the email with such skill as to make it look so like his own style of writing may be dismissed as fanciful, in my view. 67I am mindful of the care with which I must approach the evidence on this issue, in light of the gravity of reaching a finding that Mr Tsoukaris was the author of the forgery and relied upon its false contents to answer the charge. Regrettably for Mr Tsoukaris, the evidence that he did so is simply overwhelming. I am left in no doubt that that is what occurred. Events between 9 June 2010 and 23 August 2010 After the meeting on 9 June 2010, a letter was sent to Mr Keith dated 16 June 2010 (exhibit SOD2 to the affidavit of Ms O'Donnell sworn 7 October 2010 at page 4) stating: At the meeting on 9 June, Mr. Tsoukaris presented an email from you contradicting your previous advice [that he had no permission to board your vessel]. This left the Board with no alterative but to adjourn the meeting until you return from your holiday and have you attend an adjourned meeting to explain your position in this matter. 68The forged email was attached to that letter. 69Mr Keith telephoned Mr Barbouttis shortly after receiving the letter, stating that he was "furious" and had not sent any email to Mr Tsoukaris. Mr Keith advised that he would attend a meeting of the board with his son, Mr Keith Jnr, to confirm this. Mr Barbouttis asked Ms O'Donnell to re-convene the adjourned board meeting. 70A letter was also sent to Mr Tsoukaris on 16 June 2010, stating (in its entirety): Dear Mr Tsoukaris I refer to your attendance before the Board on Wednesday 9 June 2010. The Board does not summons members to a meeting until a matter has been thoroughly investigated; the Board regards the summonsing of a member as a serious matter. In relation to your matter the Commodore advises that he spoke to Mr John Keith (senior) prior to the Board meeting which decided to summon you to appear. The Commodore confirmed that Mr. Keith stated categorically that you had no authority to enter upon his boat and remove ice there from. Given that background and the report by the Rear Commodore the Board unanimously summonsed you to attend and give an explanation in accordance with Article 96. Prior to the meeting on 9 June, the Vice Commodore spoke with Mr. Keith (senior) and confirmed the advice previously given to the Commodore. Your attendance and presentation of the email from Mr. Keith leave no alternative but to adjourn the meeting until Mr. Keith returns from his holiday and have him attend the meeting to explain his position in this matter. We will advise you when the meeting will be called when we confirm Mr Keith's availability. 71Mr Tsoukais at no stage sought to correct the contention that he had presented an email from Mr Keith Snr at the meeting. In his affidavit sworn 24 September 2011, Mr Tsoukaris denied receiving any correspondence from the Club apart from a letter dated 25 August 2010 (detailed below). His account of the period from 9 June 2010 to 25 August 2010 was as follows (at paragraph 11): The next that I heard was when I received a further telephone call from the Secretary of the Club [Ms O'Donnell] on my mobile at 4.45pm on 2 August 2010. The Secretary said to me words to the effect, 'You have to be at a Board Meeting on Wednesday 4 August 2010.' I responded by saying, 'I am travelling to Melbourne on business tomorrow and will not be able to attend on 4 August 2010 on such short notice.' I was not offered the opportunity to attend an alternate Board Meeting although I did say to her, 'I will be available to attend a Board meeting in two (2) weeks time.' 72However, during cross-examination, Mr Tsoukaris said he received the letter dated 16 June 2010 on or around 20 or 21 June 2010 (T19.48-T21.5). 73Ms O'Donnell gave evidence that she called Mr Tsoukaris on 26 July 2010 at approximately 3.00 pm and asked him to attend a board meeting at 6.30 pm on 4 August 2010 to continue the adjourned meeting of 9 June 2010. She said Mr Tsoukaris told her he would be flying back and forth to Melbourne for business until the week commencing 23 August 2010, and that he had thought the issue was "all over" after speaking to Mr Barbouttis. Ms O'Donnell said she told Mr Tsoukaris that the meeting had only been adjourned, and that he replied "Oh well, I will see you on 4 August 2010 at 6.30pm" (affidavit sworn 7 October 2010 at paragraph 7). 74It is not clear whether Mr Tsoukaris denies that conversation took place. In his first affidavit, he stated (at paragraph 11): "The next that I heard was when I received a further telephone call from the Secretary of the Club [Ms O'Donnell] on my mobile at 4.45pm on 2 August 2010." However, in his second affidavit (responding to Ms O'Donnell's affidavit) he did not deny that there was a conversation on 26 July 2010. He did deny saying the words "What is the meeting about?" in that conversation (at paragraph 9). 75Ms O'Donnell sent the following letter to Mr Tsoukaris by prepaid mail on 27 July 2010 (exhibit SOD2 to the affidavit of Suzanne O'Donnell sworn 7 October 2010 at page 6): Dear Mr. Tsoukaris I refer to our letter on 28 May 2010, your attendance at the Board meeting on 9 June 2010 and our letter on the 16 June 2010. In accordance with the Articles of Association Section 96 (Disciplinary Powers of the Board), I request your attendance to reappear before the Board on 4 August 2010 at 6.30pm to afford you a further opportunity to explain or defend your conduct before a final decision is made. I advise that this matter will be dealt with in your absence if you fail to attend. 76It was put to Ms O'Donnell in cross-examination that Mr Tsoukaris had advised her he would be away until 23 August 2010 and that the terms of her letter contemplated his likely absence from the meeting. She disagreed (T121.23). 77As already noted, Mr Tsoukaris initially stated that the only letter he received from the Club was a letter dated 25 August 2010, after the expulsion decision (affidavit sworn 24 September 2011 at paragraph 14). On that basis, it appears that he denies receiving the letter dated 27 July 2010. However, that issue was not dealt with in cross-examination at the hearing. 78Ms O'Donnell says that she next phoned Mr Tsoukaris on Tuesday, 3 August 2010 at approximately 11.25am to reconfirm his attendance at the board meeting the following day. She recounted their conversation as follows (affidavit sworn 7 October 2011 at paragraph 8): I asked whether he had received my letter requesting him to come to the board meeting the following day. [Mr Tsoukaris] hesitated for some moments and then said to me words to the effect, 'I have not really opened any of my mail for the last few days as I have been busy.' [Mr Tsoukaris] then said to me words to the effect, 'Get John Barbouttis (the Club Commodore) to ring me instead of him getting you to do his dirty work for him.' I responded by saying words to the effect, 'The Commodore is a busy person and will not be ringing you.' [Mr Tsoukaris] said, 'John Barbouttis is not busy - I saw him swanning around the boat show (Darling Harbour the weekend before) avoiding me. This is ridiculous.' [Mr Tsoukaris] then said to me, 'You will be hearing from my legal people - John Barbouttis and Mick Tess will know what legal action is all about.' He then hung up. 79Mr Tsoukaris's account (set out above) is that Ms O'Donnell called him on 2 August 2010 and told him for the first time of the 4 August meeting, which he said he could not attend on such short notice. 80In cross-examination, Mr Tsoukaris appeared ultimately to accept that he made a choice not to attend that meeting. He accepted that he was in the Club on 3 August 2010 and in Sydney on 4 August 2010. The cross-examination continued (at T31.35-50): Q. And you could have gone to the club for the meeting if you wished to, couldn't you? A. Yes. Q. And you made a deliberate decision not to go to the club for the meeting? A. No. Q. What sort of decision? A. Proper business decision. Q. You put some aspects of your life in priority to this meeting, is this right? A. Yes. Q. But the explanation you gave that you were going to be in Melbourne for the date of the meeting was not what happened, was it? A. No. 81Mr Sweeney invited me to infer that Mr Tsoukaris deliberately chose not to attend the meeting of 4 August 2010. Mr McHugh submitted that it would be unfair to draw that inference when it was clear that the decision was based on the simple fact that Mr Tsoukaris was not available on the date proposed. I disagree. Many of the plaintiff's submissions on this issue rested on the premise that Mr Tsoukaris wanted to attend a further meeting of the board, the only issue being to find a convenient date. 82I do not accept that was the position. Having presented the forged email at the meeting of 9 June 2010, Mr Tsoukaris had "crossed the Rubicon", as it was put by Mr Sweeney. I accept, as submitted on behalf of the Club, that Mr Tsoukaris's position had become so untenable that avoidance of the adjourned meeting was the only option. The alternative was either to maintain the lie face to face with Mr Keith Snr or to admit the lie and the forgery. In my assessment, Mr Tsoukaris's evident reluctance to attend the meeting on 4 August 2010 is entirely explained by that circumstance. 83Mr Barbouttis gave evidence that Ms O'Donnell told him she had had two conversations with Mr Tsoukaris and that he said he would pencil in the meeting on 4 August 2010. As a result, Mr Barbouttis expected to see Mr Tsoukaris on that date (T65.27). 84The meeting re-convened on 4 August 2010 in the absence of Mr Tsoukaris. Messrs Keith Snr and Keith Jnr attended. Mr Barbouttis recounted the meeting as follows in his affidavit sworn 17 March 2010 at paragraph 14: John Keith senior addressed the meeting and said: "I have not sent any e-mail to Nick Tsoukaris in regard to this incident, I told you John on the phone and Michael Courtney just before I left that he had no permission to go on my boat." He then proceeded to show us two email footers from his office... He then said: "These are the current footers of mine and my assistant's they are not the same footer as the footer on the email you sent me. I want to state two things; I am concerned firstly as to his dishonesty and secondly about the forging of my name on the email presented by him." John Keith junior then said: "Dad's right he's a thief, I have caught him taking stuff off the boat before and told him he shouldn't be on the boat." I asked: "Have you ever sent an e-mail to Nick Tsoukaris." He said: "My company had dealt with Nick Tsoukaris a number of years ago they may have sent an e-mail then but I had no direct recollection of that he would have dealt with one of my staff he was trying to sell us some clothing or promotional gear." 85Mr Webster (at T73) and Mr Scarf (in his affidavit sworn 7 October 2010 at paragraph 4) gave evidence that they had viewed CCTV footage of Mr Tsoukaris entering the marina on the evening of 4 August, between 6.00 and 6.30pm. 86The minutes of the meeting (in their entirety) were as follows (exhibit SOD2 to the affidavit of Ms O'Donnell sworn 7 October 2010 at page 7): PresentCommodore John Barbouttis Vice Commodore Michael Courtney Rear Commodore Michael Tess Honorary Treasurer Matthew Scarf Director Neil Webster Director Michael Zammit Director Robert Paridis Director Richard Poole Apologies:Director Ian Dale In Attendance:John Keith John Keith Jnr The Commodore reconvened the adjourned meeting of 9 June 2010 at 6.00pm. The Commodore welcomed the Keiths' [sic] to the meeting and thanked them for attending. Mr. Barbouttis showed Mr. Keith all correspondence in the matter of Mr. Nicholas Tsoukaris. Mr. Keith confirmed that no emails had been either been [sic] sent or received in regards to Nicholas Tsoukaris. Mr. Keith also confirmed that he has a different footer than that presented from Mr. Tsoukaris. Mr. Keith then represented to the Board his email cover sheet and that of his P.A.'s email cover sheet. Both reflected that they were completely different. Mr. Keith explained the only time Mr. Tsoukaris had received an email from his office was when his company had purchased clothing from Mr. Tsoukaris's company some years ago. He believes this was how Mr. Tsoukaris had Mr. Keith's P.A.'s email footer. Mr Keith said "I want to state two things; I am concerned firstly as to his dishonesty and secondly about the forging of my name on the email presented by him". Messrs Keith departed the meeting at 6.20pm. The Board noted at 7.15pm that Mr. Nicholas Tsoukaris had not attended the meeting. In accordance with Article 96 of the Memo and Articles, the Board unanimously agreed this offence has such gravity as to deserve a severe punishment involving Mr. Tsoukaris expulsion [sic] from the Club. Mr. Tsoukaris is to be written to and advised of his rights on 5 August 2010 by registered mail. A copy of the letter to Mr. Tsoukaris as approved by the Board is to be annexed to these minutes. The Board resolved to adjourn the meeting to Monday 23 August 2010 at the Boardroom, 21 Wunulla Rd, Point Piper to afford Mr. Tsoukaris a further opportunity to explain or defend his conduct before a final decision is made. Such explanation may be either verbal or in writing. There being no further business, the meeting closed at 7.45pm. 87The letter to Mr Tsoukaris referred to in the minutes was sent by registered post on 5 August 2010. It stated (exhibit SOD2 to the affidavit of Ms O'Donnell sworn 7 October 2010 at page 9): Dear Mr. Tsoukaris I refer to previous correspondence and in particular notice sent to you dated 27 July 2010 in which you were summoned to reappear before the Board on 4 August 2010. The Board noted that at 7.15 on 4 August you had failed to attend the said meeting. The Board considered the explanation proffered by you on 9 June and received evidence from Mr. John Keith in relation to the "alleged" email produced to the Board by you on that occasion as the explanation for your guests' conduct. Mr. Keith stated that the email was a forgery. In accordance with Article 96 the Board unanimously resolved that the offence which is alleged against you is of such gravity as to deserve a severe punishment involving your expulsion from the Club. Further the Board resolved: To adjourn the meeting to Monday 23 August 2010 at 6.00pm at the Boardroom, 21 Wunulla Road, Point Piper to afford you a further opportunity to explain or defend your conduct before a final decision is made. Such explanation may be either verbal or in writing. It should be noted the Board at that meeting intends to decide your punishment on that evening. The Board reiterates that the charges against you are 'that on Sunday 11 April 2010 at 8.30pm guests in your company boarded a fellow member's boat and removed property, that being property of a member'. Your attention is drawn to Article 96 (a copy of which is enclosed) which gives you the right to elect for your case to be dealt with by a General Meeting of the Club instead of being dealt with by the Board. If you fail to exercise your right of election as above by notice in writing delivered to the Secretary not less than twenty four (24) hours before the time appointed for the meeting and you also fail to attend at the said meeting, a resolution of the Board carried unanimously at the meeting at which a quorum shall be not less than seven (7) members, of the guilt or innocence of you and in the former case your expulsion from the Club shall be final and effective as from that date. In the event, however, of your electing by a notice as aforesaid to have your case referred to a General Meeting of the Club for its decision, the Board shall at its earliest convenient time convene an Extraordinary General Meeting for that purpose. A resolution of such Extraordinary General Meeting carried by the vote of not less than three-fourths of the members present and having the right to vote shall be a final determination of the case, and if you are found guilty, you shall be expelled from the Club. 88Mr Tsoukaris says that he did not receive the notification to collect the registered letter dated 5 August 2010 until he returned to Sydney on or about 20 August 2010, and did not pick the letter up until after a confrontation with Mr Tess at the Club on 25 August 2010. In cross-examination, Mr Tsoukaris was asked (T33.30) "Was it the case you knew there would be a letter from the Royal Motor Yacht Club and that you did not wish to participate in any further meeting?" He responded: No, that was not the case at all. I was expecting a letter that there would be a meeting 23 August and I would receive a letter from Sue telling me there was. 89Mr Tsoukaris did not explain why, given that he was expecting such a letter, he did not collect his registered mail upon his return except to say that he receives a lot of registered mail in the course of his business (T33.28). 90Mr Babouttis accepted that he did not contact Mr Tsoukaris to make sure he was going to attend the 23 August 2010 meeting and did not, as far as he could recall, instruct anyone else to call Mr Tsoukaris for that purpose (T65.45). 91Mr Tsoukaris did not attend the meeting of 23 August 2010. The minutes of the meeting are as follows: PresentCommodore John Barbouttis Vice Commodore Michael Courtney Rear Commodore Michael Tess Honorary Treasurer Matthew Scarf Director Michael Zammit Director Robert Paridis Director Richard Poole Apologies:Director Neil Webster Director Ian Dale The meeting commenced at 5.30pm. The minutes of the Board meetings on 28 July 2010, 4 August 2010, 17 August 2010 and 19 August 2010 were accepted, proposed by Honorary Treasurer Matthew Scarf and seconded by Nice Commodore Michael Courtney. COMMODORE'S REPORT The Commodore opened the meeting and welcomed all Directors in attendance. The Commodore reiterated the facts of the Nicholas Tsoukaris matter. He referred to the letter sent to Mr. Tsoukaris (copy of which is annexed to the minutes) by registered mail. Article 96(e) in part 'If a member fails to exercise his right to election as above by notice in writing delivered to the Secretary not less than twenty four (24) hours before the time appointed for the meeting and also fails to attend at the said meeting, a resolution of the Board carried unanimously at the meeting at which a quorum shall be not less than seven (7) members, of the guilt or innocence of the member and in the former case his expulsion from the Club shall be final and effective as from that date.' Mr. Tsoukaris failed to exercise his right to elect to have this mater dealt with by a General Meeting. Mr. Tsoukaris has also failed to attend meeting [sic] he was requested on 4 August 2010. Mr. Tsoukaris was also requested to attend tonight's meeting to afford him a further opportunity to explain or defend his conduct before a final decision was made. It was noted that Mr Tsoukaris failed to attend tonight's meeting at the time appointed 6pm, (the Board noted the time had reached 6.20pm). The Board passed the following Resolution unanimously, moved by Vice Commodore Michael Courtney and seconded by Director Michael Zammit: That Nicholas Tsoukaris was guilty of the following offence; 'That on Sunday 11 April 2010 at 8.30pm, guests in your company boarded a fellow member's boat and removed property, that being property of a member.' And as such expels Mr. Nicholas Tsoukaris from the Club, such expulsion being final and effective from this date (the 23rd August 2010). The Board also unanimously passed the following resolution moved by Rear Commodore Michael Tess and seconded by Director Michael Zammit: That the vessel of Mr. Nicholas Tsoukaris be moved to a mooring forthwith and he be given 28 days to remove the vessel from the Club. A letter is to be forwarded to Mr. Nicholas Tsoukaris advising him of the Board's decisions, (a copy of which is to be annexed to the minutes of this Board meeting). Was there a breach of the hearing rule? 92Mr Tsoukaris submitted that there was "simply no hearing". I do not accept that submission. The disciplinary charge against him remained the same throughout the disciplinary process. He was informed of that charge, and was heard in response to it at the meeting of 9 June 2010. 93As submitted by Mr Sweeney on behalf of the Club, the explanation provided by Mr Tsoukaris at that meeting had jurisdictional significance. In accordance with clause 96 of the Articles, if Mr Tsoukaris's explanation was unsatisfactory and not fewer than seven members of the board considered that the allegations against Mr Tsoukaris were well-founded, there were agreed consequences within the terms of the Articles. The consequences depended on whether it was a minor offence or one as to which the same members of the board were of the opinion that the offence committed was of such gravity as to deserve a severe punishment involving his expulsion from the Club. The jurisdictional significance of the presentation of the forged email was that the explanation was unsatisfactory, which led the board to the next step. 94The board addressed those matters at its meeting of 4 August 2010. Mr Tsoukaris had notice of that meeting and could have attended it. It is relevant to consider why he did not. For the reasons explained above, I am satisfied that Mr Tsoukaris was aware that the board was requesting him to attend on that date to hear from Mr Keith Snr. I am further satisfied that Mr Tsoukaris chose not to attend the meeting in order to avoid having to confront the consequences of having presented the forged email at the previous meeting. 95It remains necessary, however, to consider what further steps the Club was required to take in order to ensure a fair process from that point. It was a requirement of clause 96 that, upon forming the opinion that the offence was of such gravity as to deserve expulsion, the board had to adjourn the meeting for a period of not less than fourteen days in order to afford Mr Tsoukaris a further opportunity to explain or defend his conduct before a final decision was made. Written notice was required to be given at that point. 96The manner of giving such notice is addressed in clause 122 of the Articles, which provides: Notices 122. A Notice may be given by the Club to any member either personally or by sending it by post to him at his registered address or, if he has no registered address within the State, to the address if any, within the State supplied by him to the Club for the giving of notices to him. Where a notice is sent by post, service of the notice shall be deemed to be effected by properly addressing, prepaying and posting a letter containing the notice and to have been effected in the case of a notice of a meeting on the day after the date of its posting, and in any other case at the time at which the letter would be delivered in the ordinary course of post provided always that non-receipt of notice by or the accidental omission to give any notice to any of the members entitled thereto shall not invalidate any resolution passed by any meeting. 97Mr Tsoukaris submitted that the notice given to him of the meeting of 23 August 2010 was not in accordance with that clause. In particular, he submitted that the giving of notice by registered mail does not comply with the requirement of the clause that service be effected by "prepaying and posting" a letter. It was submitted that there is a material difference between registered mail and pre-paid post in that, in the case of registered mail (if the person is absent at the time of delivery), all that is received is a slip of paper informing the recipient of an item for collection at the post office. 98Mr Sweeney pointed to a number of authorities in support of the proposition that prepaid post includes registered mail, including the decision in T.O Supplies (London) Ltd v Jerry Creighton Ltd [1952] 1 KB 42 at 45 per Devlin J. Contrary to the plaintiff's submissions in reply, I think that decision does provide some support for the Club's contentions. 99However, I do not think that resort to authority is necessary for the purpose of construing article 122. The requirement is that the notice be given "by sending it by post". I see no reason why that expression should be construed to exclude notice given by sending an item by registered post. 100To the extent (if any) that the meaning of that expression is qualified by the deeming provision in clause 122, the requirement is that the notice be given "by properly addressing, prepaying and posting" the letter. Once again, I see no reason why the requirement of prepaying the cost of posting the letter should be construed to exclude prepayment for delivery by registered post. I do not think the clause poses any difficulty in that respect. Members agreed that notice could be given to them by post, and that is what occurred in the present case. 101It follows, in my view, that notice of the meeting of 23 August 2010 as required by clause 96 was given to Mr Tsoukaris in accordance with clause 122. 102Mr Tsoukaris relied upon the further consideration that, whereas on earlier occasions Ms O'Donnell had called him to make sure he was aware of scheduled meetings, no call was made to inform him of the meeting of 23 August 2010. I do not think that the Club was required by the rules of procedural fairness to make any such telephone call. Even assuming that it is necessary or appropriate to look outside the clear provisions of the Articles on this issue, Mr Tsoukaris had been difficult in his discussions with Ms O'Donnell and had shown no willingness to cooperate with her in her attempts to secure his attendance at the previous meeting. In my opinion, the requirements of procedural fairness did not extend to requiring the board to play along on his terms. 103In any event, the terms on which members participated in the benefits provided by the Club are those set out in the Articles of Association, by which members are bound. In the case of voluntary tribunals, the court should not overlook the terms of such agreements in determining the requirements of procedural fairness. 104For those reasons, I am satisfied that the Club complied with the requirements of procedural fairness to give notice that a decision adversely affecting Mr Tsoukaris's interests might be made at the meeting of 23 August 2010. 105In case my conclusion on that issue is wrong, it is appropriate to consider whether Mr Tsoukaris in fact collected the letter dated 5 August 2010 before the meeting of 23 August 2010. I am satisfied, on balance, that he probably did not. The Club submitted that Mr Tsoukaris's evidence on the issue of whether he had actual notice of the meeting should be rejected and that his appearance of surprise when he arrived at the Club on 25 August 2010 and was told he had been "expelled for life" was feigned. 106I do not think I can draw that conclusion. There is ample indication in the evidence that Mr Tsoukaris was slow to appreciate the seriousness with which the Club regarded the underlying incident. After failing in his attempt to resolve the issue by presenting the forged email from Mr Keith Snr, he ought to have appreciated the risk that further action would be taken against him. At the very least, it may be said that a sensible person in his position would have been astute to that risk. However, it is difficult to accept that even a man of Mr Tsoukaris's evident confidence would deliberately let his opportunity to defend his membership pass and then turn up at the Club intending to pretend ignorance that the battle was over. It may be that Mr Tsoukaris had his head in the sand during the period after the meeting of 9 June 2010, but I am not persuaded that he in fact received the letter dated 5 August 2010 and made a deliberate choice to ignore it. 107It was submitted on behalf of the Club that, whether or not Mr Tsoukaris in fact received notice of the meeting of 23 August 2010, he had no intention of attending that meeting in any event. On that basis, it was submitted that any breach of the requirements of procedural fairness made no difference to the outcome. 108I think there is force in the contention that Mr Tsoukaris would have been loath to attend any further meeting of the board. However, I cannot exclude the possibility that, had he become aware of the risk of expulsion, he may have exercised his right under clause 96 to elect for his case to be dealt with by General Meeting of the Club instead of being dealt with by the board. I do not think it is appropriate for me to presume to know what the outcome of such a meeting would have been. Accordingly, if I am wrong that there was no failure to comply with the obligation of procedural fairness, it cannot be concluded that compliance with that obligation would have made no difference to the result: cf Stead v State Government Insurance Commission [1986] HCA 54; (1986) 161 CLR 141. 109In any event, for the reasons already explained, I am satisfied that notice of the meeting was given in accordance with the Articles of Association and that the requirements of procedural fairness were accordingly met. Was there a breach of the bias rule? 110The complaint that there was a breach of the bias rule is based on the involvement of Mr Tess and Mr Barbouttis in the passing of the expulsion resolution. 111In the application of the bias rule, it is recognised that a distinction is to be drawn between domestic, consensual or private tribunals on the one hand and statutory or public tribunals on the other hand. In the case of a public or statutory tribunal, it is accepted as a fundamental requirement that justice should not only be done (in that the matter should be heard by a person who is free of actual bias), but should be seen to be done (in that a reasonable observer would not have apprehended bias on the part of the decision-maker). 112In the case of a consensual tribunal such as the board of the Club (exercising its disciplinary powers), apprehended bias as distinct from actual bias may not be enough to disqualify a member from participating in a decision: Maloney v New South Wales National Coursing Association Ltd [1978] 1 NSWLR 161; cited in Battle v Bundagen Co-Operative Ltd (No 2) [2011] NSWCA 38 at [56] per Hodgson JA; Campbell JA agreeing at [87]; Sackville AJA not expressly agreeing. 113Mr McHugh submitted that the principle stated in Maloney was refined in Dale v New South Wales Trotting Club Ltd [1978] 1 NSWLR 551. He submitted that, whilst the presence of a reasonable suspicion of bias does not disqualify a person from participating as a member of a domestic tribunal, in relation to conduct in the course of the tribunal's proceedings, the test is whether a reasonable observer having knowledge of the Articles of Association would have apprehended bias. 114In any event, for the reasons that follow, I am not persuaded that there was actual bias or any basis for a reasonable observer having knowledge of the Articles to apprehend bias. 115Mr Tsoukaris submitted that the bias rule was breached by reason of the involvement of Mr Tess and Mr Barbouttis. Mr Tess accepted that he was the complainant (T104.10), accuser (T104.45) and a judge (T104.55-105.10). Mr McHugh noted that Mr Tess reported the incident in the first place and believed his account to be true, "absolutely" (T101.55). It was submitted that this is actual bias or, at the very least, a basis for apprehended bias on the part of a reasonable observer of the conduct of the proceedings. 116As to Mr Barbouttis, it was submitted that he appeared to have made his mind up at the very start, based on his evidence (at T64.1-64.15) as follows: Q. When you had said in the charge that it was an allegation that property had been removed that was not your view? A. My view, and I had been told property had been removed. Q. And you believe that to be true? A. I had not heard anything to the contrary. Q. And you believed that to be true? A. Yes. 117It was further submitted that Mr Barbouttis was, in substance, a complainant himself, as he had invited Mr Keith Snr to bring the complaint. There is no dispute that both Mr Tess and Mr Barbouttis were present during all deliberations and decisions concerning Mr Tsoukaris. 118It may be accepted that, in the case of a statutory or public tribunal, the participation of a decision-maker who was also the complainant or a critical witness in the prosecution of a complaint would be considered completely inappropriate. Whether the position is different in the case of a voluntary tribunal is an issue which must fall to be determined by reference to the terms on which members have agreed to participate in its proceedings. 119In my view, the constitution of the board as the entity with disciplinary powers over members of the Club necessarily bought about a situation in which those powers might be exercised with the participation of persons who had witnessed the conduct complained of and otherwise participated in the launching of the disciplinary process: cf Australian Workers' Union v Bowen where Dixon J observed at 630: Domestic tribunals are often constituted of persons who may, or even must, have taken some part in the matters concerning which they are called upon to exercise their quasi-judicial function. 120Statements to similar effect may be found in Whittle v Australian Miniature Pony Society Inc (1995) 57 FCR 252 at 268-269 per Burchett J and Cains v Jenkins (1979) 28 ALR 219 at 227 per Sweeney and St John JJ. 121It is an inescapable feature of the facilities provided by the Club that the Rear Commodore, and perhaps to a lesser extent the Commodore, will frequently have taken part in the matters concerning which the board is called upon to exercise its disciplinary powers under clause 96. As noted on behalf of the Club, the Rear Commodore is one of the "Flag Officers" of the Club: see clause 1 of the Articles. He presides over the Marine Committee, which is responsible for the affairs of the marina and its functions, including the protection of its premises and equipment. 122In my view, the participation of the Commodore and the Rear Commodore in the exercise of the board's disciplinary powers in respect of matters in which they may have played a factual or prosecutorial role is plainly within the contemplation of the Articles. Contrary to the plaintiff's submissions, that is not axiomatically to be equated with actual bias. The consensus underlying the authority of the board to exercise disciplinary power over members militates against that conclusion. The obvious likelihood that the Rear Commodore would vote in accordance with his own view of events witnessed by him is checked in the Articles by the requirement that an expulsion resolution be carried unanimously at a meeting of the board with a quorum of not fewer than seven members. 123For those reasons, I am not persuaded that there has been any breach of the bias rule. Formulation of the charge 124I should briefly address one further issue which appeared to be relied upon by Mr Tsoukaris at the hearing, although it did not feature in the final submissions. 125The charge against Mr Tsoukaris alleged the removal of property, in effect amounting to a charge of stealing. The evidence clearly established that no ice was in fact removed from Big Buddy, Mr Tess having intervened before that occurred. 126There was some confusion in the evidence of the members of the board as to whether they understood Mr Tess to have said that Mr Tsoukaris's guests had actually removed ice, or only that the guests had attempted to remove ice without succeeding in doing so (see eg T68, T75, T92, T101-102, T116). 127Mr Babouttis accepted that he may have been mistaken when he said, both in letters sent to Mr Tsoukaris and in board meetings, that the Rear Commodore Mr Tess had reported to him that Mr Tsoukaris's guest "removed some ice", or otherwise removed Mr Keith's property. 128In my view, the significance of that issue falls to be assessed by reference to my finding as to what transpired at the meeting of 9 June 2010. In light of Mr Tsoukaris's claim, purportedly substantiated by the forged email, that he was entitled to board Mr Keith's vessel to retrieve his own ice stored there by agreement, the issue whether the charge alleged a successfully executed offence or only an attempt was of no consequence. The justice of the procedure must be assessed according to the real issues in dispute. Conclusion 129For those reasons, I am not satisfied that there has been any breach of procedural fairness or any oppressive or unfairly prejudicial conduct within the meaning of section 232 of the Corporations Act. 130In case I am wrong in reaching those conclusions, I should indicate the factors that I would have taken into account in considering whether to exercise the discretionary power to grant the relief sought. It necessarily follows from my conclusion that Mr Tsoukaris prepared the forged email, and presented it at the meeting of 9 June 2010 as his explanation in answer to the charge, that I reject his evidence on that issue given at the proceedings before me. Specifically, I am satisfied that his denial of any knowledge of that email must have been false. 131In my view, that is a factor which ought to preclude Mr Tsoukaris from obtaining the relief sought both at common law and under the Corporations Act. To grant the relief sought would aid Mr Tsoukaris to derive advantage from his own wrong (in putting forward a false denial so as to sustain the relief sought): cf Meyers v Casey at 124.3 per Isaacs J. 132Accordingly, even if I had been persuaded that there was a breach of the requirements of procedural fairness, or oppressive conduct within the meaning of the Corporations Act, I would not have granted the relief sought. 133In light of the conclusions I have reached, it is not necessary to consider the Club's contention that Mr Tsoukaris is precluded in any event from obtaining relief on the basis that he exercised his entitlement under clause 34 of the Articles to request the board to reconsider the matter on the grounds of special circumstances. 134The order of the Court is that the proceedings be dismissed. At the request of the defendant (T39.31), I will hear the parties as to costs. ********** 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: 10 October 2012