(a) The Nature of unincorporated associations
19The HSU submitted that the absence of rules, especially at the point of formation, had the consequence that an unincorporated association was never validly formed and therefore the applicant did not exist. Further, because of this fatal flaw, the applicant was "not an organisation of employees" able to apply for registration under s 219 of the IR Act. In support of this submission it was argued that the usual way for an association to be formed was that a group of persons would gather together and would agree to form an association and be bound by its rules. Such rules usually provided that specified persons would hold office until a given date or event. At this point the association is set up and has foundation members. After that, the association is able to recruit members and hold meetings in ways permitted by the rules. Having regard to the issues raised by the HSU objection, it is necessary to consider the nature of an unincorporated association and the ability to overcome perceived defects in its formation, rules and operation.
20In Cameron v Hogan (1934) 51 CLR 358, the High Court acknowledged that there was an assumption that members of an unincorporated association do not intend to be contractually bound by the Association's rules and the courts would assume that there were no legal obligations between members unless the rules actually made it clear to the contrary.
21Having regard to these general principles, it is appropriate, therefore, to set out in some detail passages of the judgments in Cameron that have particular relevance for the present proceedings. In the joint judgment of Rich, Dixon, Evatt and McTiernan JJ, commencing at p 370, their Honours stated:
Judicial statements of authority are to be found to the effect that, except to enforce or establish some right of a proprietary nature, a member who complains that he has been unjustifiably excluded from a voluntary association, or that some breach of its rules has been committed, cannot maintain any action directly founded upon that complaint. For example, in Forbes v Eden, (1867) LR 1 Sc. & D. 568 at p 581, Lord Cranworth said
Save for the due disposal and administration of property, there is no authority in the Courts either of England or Scotland to take cognizance of the rules of a voluntary society entered into merely for the regulation of its own affairs.
Gavan Duffy, J, considered that such statements should be understood as relating only to the jurisdiction of Courts of Equity. There are, however, reasons which justify the statement that, at common law as well as in equity, no actionable breach of contract was committed by an unauthorised resolution expelling a member of a voluntary association, or by the failure on the part of its officers to observe the rules regulating its affairs, unless the members enjoyed under them some civil right of a proprietary nature. As a generalisation it expresses the result produced by the application of a number of independent legal principles: it is not in itself the enunciation or explanation of a rule or rules of the common law. One reason which must contribute in a great degree to produce the result is the general character of the voluntary associations which are likely to be formed without property, and without giving to their members any civil right of a proprietary nature. They are for the most part bodies of persons who have combined to further some common end or interest which is social, sporting, political, scientific, religious, artistic, or humanitarian in character, or otherwise stands apart from private gain and material advantage. Such associations are established upon a consensual basis, but, unless there were some clear positive indication that the members contemplated the creation of legal relations inter se, the rules adopted for their governance would not be treated as amounting to an enforceable contract. ... (pp 370 - 371)
...
If a member of a voluntary association complains, not of an invalid expulsion, but of some failure to observe the rules on the part of the committee or other officers, it would be necessary for the member complaining to show that the rules were intended to confer upon him a contractual right to the performance of the particular duty upon which he insists. It can seldom be the true meaning of the rules of any large association of such a kind that those undertaking office thereby enter into a contract with each and every member that they will execute the office in strict conformity with the rules. If, however, it were determined that the committee or the officers of a voluntary association, in attempting to exclude the member complaining, or in some other respect, had committed a breach of contract, the remaining members of the association would not be responsible. The committee or officers may be agents for the members of the association. But if so they are agents for all the members. If in the case of a member complaining they have violated the rules, they have exceeded their authority. Upon no doctrine of agency can one of the joint principals hold the others responsible. (p 373).
But the question which arises first is whether the rules relating to the selection of party candidates were intended to operate at all as a contract. If the action be treated as a representative proceeding against all the members of the party other than the respondent, it would be necessary for him to establish that the rules should be understood as a warranty by every member to every other who should be nominated for selection that his name would be admitted to ballet, unless it was withdrawn after proper opportunity for defence. If the action be treated as a proceeding against the members of the central executive who failed to submit the respondent's nomination for ballot, to establish a breach of contract it would be necessary for the respondent to show that the appellants, either by accepting office, or by adhering to the rules as members of the party, engaged with him contractually as a member to perform their duties in relation to nomination, in complete accordance with the rules. Neither of these interpretations of the rules appears to be warranted. Hitherto rules made by a political or like organisation for the regulation of its affairs and the conduct of its activities have never been understood as imposing contractual duties upon its officers or its members. Such matters are naturally regarded as of domestic concern. The rules are intended to be enforced by the authorities appointed under them. In adopting them the members ought not to be presumed to contemplate the creation of enforceable legal rights and duties so that every departure exposes the officer or member concerned to a civil sanction. (p 376).
22In his separate judgment, Starke J, at p 384, stated:
As a general rule the Courts do not interfere in the contentions or quarrels of political parties, or indeed in the internal affairs of any voluntary association, society, or club.
Agreements to associate for purposes of recreation, or an agreement to associate for scientific or philanthropical or social or religious purposes are not agreements which Courts of law can enforce. They are entirely personal. Therefore, in order to establish a civil wrong from the refusal to carry out such an agreement, if it can be inferred that any such agreement was made, it is necessary to see that the pursuer has suffered some practical injury, either in his reputation or in his property - Murdison v Scottish Football Union, (1896) 23 R (Ct. of Sess.) 449 at pp 466-67.
Contractual rights, therefore, appear to me out of the question. The rules of a voluntary association organised for political purposes are not agreements enforceable at law, or, in other words, contracts. Members of such associations who have grievances must resort to the remedies and the redress afforded them by the rules of their associations and not to the Courts of law.
23It was submitted for the HSU that "the essential or normal characteristics" of an incorporated association had been identified in Conservative and Unionists Central Office v Burrell (Inspector of Taxes) [1980] 3 All ER 42 at 58 as follows:
(i) there must be members of the association;
(ii) there must be a contract binding the members inter se;
(iii) there will normally be some constitutional arrangement for meetings of members and for the appointment of committees and officers;
(iv) a member will normally be free to join or leave the association at will;
(v) the association will normally continue in existence independently of any change that may occur in the composition of the association;
(vi) there must as a matter of history have been a moment in time when a number of persons combined or banded together to form the association.
24The passage quoted above from the 1980 report was from the judgment of Vinelott J sitting at first instance in the Chancery Division. The passage quoted from p 58 does not represent the court's determination but recounts the argument for counsel for the Central Office of the Conservative Party that those six characteristics were "either essential or normal characteristics of an unincorporated association." The first instance judgment was later considered on appeal in Conservative and Unionists Central Office v Burrell (Inspector of Taxes) [1982] 2 All ER 1.
25The issue that arose in the Conservative and Central Office case was whether income earned on subscriptions to the Conservative party was taxable as the Conservative Party and its various organisational modes was "an unincorporated association" within the meaning of provisions of the Income and Corporation Taxes Act 1970. For the purposes of this Taxing legislation, the earnings of unincorporated associations were treated as earnings of a corporation. The argument, therefore, developed around the nature of the Conservative Party: the evidence showed that it was constituted by members of the Parliamentary Party, the mass membership represented by the national union and the Party headquarters known as the Central Office. The Central Office was assessed as liable to pay corporation tax on investment income as being an unincorporated association within the meaning of the Taxation legislation. This assessment was appealed by the Central Office to the Special Commissioners where it argued that it was not an unincorporated association and even if the National Union was an unincorporated association, the funds did not belong to the National Union but were administered by the Central Office. The Conservative Party was an "amorphous combination of various elements" lacking the characteristics of an unincorporated association. Ultimately, Vinelott J held that it could not be said that the Conservative Party was an unincorporated association and thus, the appeal against the taxation assessment was upheld.
26The matter proceeded by way of a Stated Case. The essential aspects of the Stated Case were recorded at the beginning of the report where the following extract was reproduced from the determination of the Special Commissioners regarding the relevant law (at 47):
We were usefully referred to a number of cases dealing with the characteristics of unincorporated associations in a variety of contexts. Three of the cases contained short statements of what are some of the essential features in law of an unincorporated association. In Re Thackrah [1939] 2 All 4 at 6, a gift by will to the Oxford Group was in question. Bennett J commented: "Before one can find an association, there must be some rules, either written or oral, by which those who are supposed to be members of it are tied together. I think that they would probably be written rules. There must be some constitution." In Re Price [1943] 2 All ER 505 at 508, [1943] Ch 42 at 428, Cohen J referred to the comment of Lord Buckmaster in Macaulay v O'Donnell [1943] Ch 435 at 436 referring to a gift to an unincorporated association: "A group of people defined and bound together by rules and called by a distinctive name can be the subject of a gift as well as any individual or incorporated body." In the case of The Caledonian Employees' Benevolent Society 1928 SC 633 at 635, absence of any consensual contract amongst its member was a bar to the claim that the Society was an unincorporated association. The Lord President, referring to the Companies (Consolidations) Act, 1908 said:
It is not, I think, open to doubt that the fundamental and essential characteristic of the whole class of bodies described in the Act as companies, associations and partnerships, is that they are bodies constituted by some species of contract of society, and founded on the contractual obligation thus undertaken by the members, ... No doubt the word 'association' is by itself capable of including a wide variety of much more loosely and irregularly constituted bodies of persons: but looking to the context in which it appears ... I see no reason to doubt that what is meant is a society (whatever its object) based on consensual contract amongst its constituent members whereby their mutual relations inter se with regard to some common object are regulated and enforced.
27The Special Commissioners' reasons also contained reference to in Re Recher's Will Trusts re National Westminster Bank Ltd v National Anti-Vivisection Society Ltd [1971] 3 All ER 401 at 407 - 408 where Brightman J was dealing with a gift to a non-charitable association. It was noted that persons could band themselves together as an association or society, pay subscriptions and validly donate their funds in pursuit of some lawful non-charitable purposes. The obvious example given was a member's social club. Personal advantage was not essential to the members. The funds of such an association may be applied exclusively to the pursuit of some outside purpose. Of such a body, Brightman J stated:
Such an association of persons is bound, I would think, to have some sort of constitution; that is to say, the rights and liabilities of the members of the association will inevitably depend on some form of contract inter se usually evidenced by a set of rules. In the present case it appears to me clear that the life members, the ordinary members and the associate members of the ... Society were bound together by a contract inter se. Any such member was entitled to the rights and subject to the liabilities defined by the rules. If the committee acted contrary to the rules, an individual member would be entitled to take proceedings in the courts to compel observance of the rules or recover damages for any loss he had suffered as a result of the breach of contract.
28It was in that context that counsel for the Central Office identified six characteristics that were said to be required to establish the body as an unincorporated association. These were the six matters referred to in the written submissions for the HSU. The need for a contract, however, was able to be met "usually" by a set of written rules. These were submitted to be the "essential or normal characteristics of an unincorporated association." Importantly, it was then recorded at p 49 that counsel for the Crown submitted that in Re Smith Johnson v. Bright-Smith (1914) 1 Ch 937 supported the proposition that the "contract" between the members of an unincorporated association "might be in agreement or understanding falling short of a legally enforceable contract." The Commissioners then pointed to the speeches in The Free Church of Scotland [1904] AC 515 where Lord Davey referred to that Church "as a voluntary and unincorporated association of Christians united on the basis of agreement in certain religious tenets and principles of worship, discipline and church government." The Special Commissioners said that this was an illustration of an unincorporated association where the basis of the banding together was a commitment to an acceptance of certain ideas and doctrines and where the contract between the members depended not so much on any written rules as on "what had to be inferred from all the surrounding circumstances."
29After setting out the submissions for counsel for the Central Office as to the six characteristics (either essential or normal) for the establishment of an unincorporated association, at p 58 (relied upon by the HSU in the present case) it was then recorded that counsel for the Central Office made it clear that three of the six characteristics were not essential characteristics of an unincorporated association, namely, that there would normally be some constitutional arrangement for meetings of members and for the appointment of committees and officers; that a member would normally be free to join or leave the association at will and the association would normally continue in existence independently and any change that may occur in the composition of the association. In relation to this argument, Vinelott J (at 58) stated:
It is possible to imagine an unincorporated association which lacked, at least, one of these characteristics. For instance, a members' club might be so exclusive as to make no provision for the admission of new members and the original members might conceivably band themselves together in life membership. But the first two characteristics are put forward, I think rightly, as essential characteristics. Indeed, they seem to me no more than an analysis of the concept of an unincorporated association. The sixth characteristic is, I think, also a necessary characteristic of an unincorporated association. If an unincorporated association is a "group of people defined and bound together by the rules and called by a distinctive name" (see per Lord Buckmaster in Re Mcaulay's Estate, Mcaulay v O'Donnell [1943] Ch 435 at 428), there must have been a moment in time when the first members agreed expressly or impliedly to be bound by the rules. But in practice the task of answering the question whether a body with a distinctive name is an unincorporated association will rarely, if ever be, much assisted by asking when it came into existence. In many, if not most cases, an unincorporated association will have been gradually transformed over a period of time in to something very different from the unincorporated association from which it grew and it may well be impossible to ascertain either the date of its formation of (sic) the moment in time in this process of change when it assumed its distinctive contemporary character.
30Before dealing with the judgment on appeal, it is appropriate at this point to observe the central role played by contract in the English cases. In the variety of cases referred to above, contract was essential and was evidenced by the rules or inferred from surrounding circumstances. That is why the rules are significant in English cases even though those rules need not be in writing and the circumstances may have to be examined to see when the members first agreed "expressly or impliedly" to be bound by the rules. The High Court in Cameron v Hogan, as noted above, did not embraced the concept of contract as being essential for the existence of an unincorporated association: the presumption is that no contract was intended by the parties but the presumption is rebuttable by analysis of the terms of the arrangement.
31On the appeal, (Conservative and Unionist Central Office v Burrell (Inspector of Taxes), again the central issue was the identification of a contractual relationship between the three major threads of the Conservative Party. Lawton LJ noted that both parties to the appeal asked the Full Court to consider the legal nature of the Conservative Party and the statutory background where certain earned income of an unincorporated association was taxable and then stated at p 4:
I infer that by 'unincorporated association' in this context Parliament meant two or more persons bound together for one or more common purposes, not being business purposes, by mutual undertakings, each having mutual duties and obligations, in an organisation which has rules which identify in whom control of it and its funds rests and on what terms and which can be joined or left at will. The bond of union between the members of an unincorporated association has to be contractual. ...
Since membership of an unincorporated association is based on agreement between the members, a starting point for examining the legal nature of the party is to consider how anyone can join it.
On this analysis it was found that no one could directly join the party with membership being obtained either through a local constituency association or through the parliamentary party. On the facts, nothing could be found which contractually linked members of the local constituency associations to Conservative members of the House of Commons representing their constituencies. It was noted that while counsel for the Crown accepted that all those who were members of the national union were members of an unincorporated body, it still left "a constitutional gap" between the national union and the parliamentary party. Brightman LJ agreed with the analysis of Lawton LJ that such an overall unincorporated association did not exist and Fox LJ agreed with the judgments of Lawton and Brightman LJJ.
32The HSU submissions then relied on the judgment in City of Gosnells v Roberts (1994) 12 WAR 437 at 448 for the proposition that, without rules, an alleged association lacks the essential characteristic of an unincorporated association, that is, a composite body of persons in a legal relationship giving rise to mutual rights and obligations. That case involved an action for negligence where a horse had strayed on to a public road and the plaintiffs were injured as the result of a collision. The action was brought in negligence. The City of Gosnells was joined as a defendant as it owned the land from which the horse had escaped and the owner of the horse was also joined. Further defendants were the office bearers of the Gosnells Polocrosse Club, the body to which the City of Gosnells had leased the land at the time of the accident. At first instance, the club was found liable because of its occupation and control over the land and that liability attached to the members of the Executive Committee. That result ensued because the law had to attribute liability to some person where an unincorporated body was involved.
33In the judgment of Pigeon J at 443, his Honour considered whether or not the club could be made liable in circumstances where it was not incorporated, did not have a constitution or rules and was not a legal entity. In relation to this matter, his Honour stated:
In my view, the proper conclusion on the evidence is that the body did exist as an unincorporated association. The evidence showed the existence of a group of persons carrying on an activity under the name of the Gosnells Polocrosse Club. It had a bank account and it held meetings and the activities it pursued were determined at these meetings. These facts are apparent from the club's minute book. The common law relating to the conduct of meetings would apply in respect of these meeting and the moneys in the bank account would be held on trust to carry out the activity of the club as determined by these meetings. Any liability which such group would have towards other persons would not be extinguished merely because it did not have a written constitution and the trial judge recognised this.
34In a separate judgment, Roland J appears to have accepted the correctness of the result proposed by Pigeon J (as did the third member of the court, Anderson J). His Honour noted that all parties recognised and accepted that an unincorporated body without a constitution could not be a party to these proceedings and simply did not exist as a legal entity (at 444). He noted, however, there were authorities to support a claim that those who band together for a common purposes can, through their collective appointed officers, incur liability.
35In its submissions the HSU relied upon the separate judgment of Anderson J. At 448, his Honour expressed his views as follows:
As to whether there was a lease or agreement for lease to the "club", in my opinion there was not. In the first place, there was, in truth, no such legal entity. The "club" had no constitution and no rules. It did not therefore have the essential characteristic of an unincorporated association, ie, a composite body of persons in "a legal relationship ... giving rise to joint rights or obligations or mutual rights and duties": see Re Commonwealth Homes & Investment Co Ltd [1943] SASR 211 at 228, per Mayo J. See also Bohemians Club v Acting Commissioner of Taxation (Cth) (1918) 24 CLR 334 at 337 per Griffiths CJ. There was a mere aggregation of persons not in any legal relationship, not bound together by any identifiable consensual arrangement and not defined by any constitution. There was therefore no separate or identifiable entity for whom Mrs Duncan might have had some authority to complete the transaction.
36It is not totally clear where the majority opinion lies in this case. The presiding Judge, Pigeon J, concluded that the club did exist as an unincorporated association. Anderson J concluded to the contrary. Roland J agreed generally with both their reasons but did not specifically reject this aspect of either Pigeon J or Anderson J. His Honour does appear to have accepted, however, that the club was an unincorporated body because he referred to the fact that as an unincorporated body without a constitution, it could not be a party to the proceedings. He cited authority for that proposition. The headnote also treats his Honour as being in agreement with Pidgeon J on this issue.
37The judgment of Anderson J principally relied upon the judgment of Mayo J in Re Commonwealth Homes & Investment Co Ltd [1943] SASR 211 at 228. That case is, however, of little assistance in relation to the issues arising in the present proceedings. In that case, a limited company was incorporated under the Companies Act 1961 for the purpose of issuing bonds that were to be acquired by subscribers in consideration of payment of premiums. An issue arose about the terms of a prospectus that has no bearing on the present issue before this Court. At pp 228 - 229, his Honour considered whether the acts of the company and the bondholders resulted in the formation of an association. His Honour stated that to establish an association a legal relationship must be created between the members giving rise to joint rights or obligations of mutual rights. The rights, inter socios, if not of statutory origin, may ordinarily be expected to be contractual. The importance of this consideration was that if there had been such an association, then a statutory provision would prohibit the operation of such an association and would deprive the participants of action against each other. No party had suggested that there was such an association but it was a matter that his Honour concluded should be investigated and determined. His Honour held that there was no such association because, on the evidence, there was no direct intercourse between applicants for bonds or bondholders as such and he noted that by joining in and becoming privy to a common project without any direct communication, persons may, nevertheless, sometimes find themselves in a contractual relationship. That was not the case in the matter before Mayo J and therefore there was no formation of an association under the relevant statutory provision. Again, that appears to be an association whereby contractual relations were not created. Perhaps, because of special statutory provisions, Mayo J did not make any mention of Cameron v Hogan, a case decided by the High Court in 1934: nor did Anderson J in his separate judgment in City of Gosnells. The Bohemian Club case turned on the character of fees as income for tax purposes. The Club was assumed to be an unincorporated association. It is difficult to see how these cases supported the views expressed by Anderson J about the essential elements of an unincorporated association.
38More recently, the Victorian Supreme Court has dealt with the issue of the formation and the time when an unincorporated association comes into existence. In Kibby v Registrar of Titles [1999] 1 VR 861, Mandie J dealt with a claim that an incorporated association established under the Associations Incorporation Act 1981 (Vic) claimed that land registered in the plaintiff's name was held on trust for an unincorporated association of which it was the successor. In the proceedings it was alleged that the association, prior to its incorporation, purchased certain land with several members of the association agreeing to act as trustees. Those members were shown on the certificate of title as the registered proprietors. For many years a small group of people had met regularly in the library of a house located near the property in question. There were regular meetings where the participants discussed religion, comparative and oriental religion and philosophy. There were occasional lectures or talks. Some four years or so after these meetings commenced, a property directly opposite this meeting place became available for sale. A steering group or committee had been informally set up to find an appropriate site and this land was chosen. At approximately this time, a named association commenced although there was a dispute about when that occurred. At the discretion of the senior member of the association, there was evidence of membership being granted with people joining and remaining but there was no set of rules or a constitution. Other evidence suggested that the membership was fluid and based on friendship, with people coming and going as they pleased.
39At [40], his Honour commenced an analysis of the characteristics of an unincorporated association, introducing this discussion as follows:
The characteristics of an unincorporated association
[40] The Act provides no particular guidance as to the nature of an association apart from the definition in s. 3(1) but there is no reason to suppose that the Act narrows the legal concept of an association apart from the requirement that it have not less than five members. A number of cases contain statements as to the nature of an unincorporated association and, provided that account is taken of any statutory or other special context, those statements are of assistance in the present case.
[41] An association has of course no separate or distinct existence apart from its members. It is a voluntary combination of persons with some object or purpose in common: see Amos v Brunton (1897) 18 L.R. (N.S.W.) Eq. 184 at 186-7; 14 W.N. (N.S.W.) 69 at 70. If the association "has" assets, they belong, subject to the rules, to the members for the time being: see Doust v Attorney-General (1904) 4 S.R. (N.S.W.) 577 at 583. Doust v Attorney-General (1904) 4 S.R. (N.S.W.) 577 at 583. The rules do not necessarily constitute an enforceable contract between the members (Cameron v Hogan (1934) 51 C.L.R. 358; but cf. Re Sick and Funeral Society [1973] Ch. 51 at 59-60 per Megarry J).
40His Honour then considered statements from the High Court in Watson v J & A G Johnson Ltd (1936) 55 CLR 63, in Re Thackrah [1939] 2 All ER 4, The Conservative Unionists Central Office case (judgment of Vinelott J) and appearing in The City of Gosnells. At [44], his Honour noted that in Twycross v Potts [1928] SC 633 at 635, Lord President Clyde, whilst deciding that the words "company, association or partnership" in the Companies (Consolidation) Act 1908 referred to bodies "constituted by some species of contract of society", nevertheless, stated that "no doubt the word 'association' is, by itself, capable of including a wide variety of much more loosely and irregularly constituted bodies of persons" other than in the context of the Companies Acts.
41His Honour then considered dictionary definitions of the word "association" and identified the requirements of an unincorporated association. Those passages of his Honour's judgment are set out below:
[49] A selection of definitions from the Shorter Oxford English Dictionary points to the tautology or circularity involved in the s 3(1) definition of "association"
Association: "a body of persons associated for a common
purpose";
Associate: - "combine for a common purpose, join".
Society: "a number of persons associated together by the same common interest or purpose".
Club: "an association of persons meeting periodically";
"an association of persons interested in the promotion of some object";
an assocition of persons formed mainly for social purposes".
Institution: "an establishment, organisation or association instituted for the promotion of some object":
Body: - "a society, association, league, fraternity".
[50] In the light of the judicial statements to which I have referred and the ordinary meaning of the words contained in the said definition, I consider that the essence of an "association" may be described as some form of combination of persons (with a common interest or purpose) with a degree of organisation and continuity at least sufficient to distinguish the combination from an amorphous or fluctuating group of individuals and with some clear criteria or method for the identification of its members.
[51] I do not think that a name or title, or the existence of a written constitution or rules governing the combination, or the existence of some form of contract between the members, is an essential characteristic, but clearly the existence of one or more of these would go a long way towards satisfying the need for some degree of organisation and continuity and for the satisfactory identification of members. Likewise, the existence of office-bearers, a committee and a bank account are relevant to a degree of organisation. The absence of all of these features makes it unlikely, but not impossible, that an association has been formed or is being carried on.
42The flexibility with which unincorporated associations might operate was demonstrated in Ball v Pearsall (1987) 10 NSWLR 700. In that case, Young J was dealing with an application for declarations pursuant to the provisions of the Supreme Court Act 1995 as to the validity of an election of officer bearers in an unincorporated association and a declaration that a member (who had been expelled at the same meeting as the election took place), was entitled to move a motion of which notice had been given.
43The brief facts were that, during the course of an apparently highly volatile meeting, members had withdrawn and some had returned to the meeting in general protest as to the manner of its conduct. When up to 100 people finally left the meeting, the remaining 20 or so members purported to conclude the business. A question arose as to whether it was necessary to have a quorum of an unincorporated association at the time when it conducts an election or whether it is sufficient that the quorum was present at the commencement of the meeting: an allied question was whether, as a matter of law, all members of the unincorporated body had to be present before any business could be transacted. The by-laws and constitution of the body did not nominate a quorum for an annual meeting or a special general meeting but nominated seven as a quorum for a committee meeting.
44As to the issue of whether all members had to be present to form a quorum in the absence of a specified quorum in the rules, his Honour stated, at p 703
The first focus of this judgment must be on whether it is necessary to have a quorum of an unincorporated association at the time when it makes an election or whether it is sufficient that the quorum is present at the commencement of the meeting or indeed, whether as a matter of law all the members of the unincorporated body must be present before any business can be transacted.
It seems to me that as a matter of theory the last-mentioned possibility is the correct one, if there is nothing else in what the parties have done to exclude it. It seems to me that cases such as Green v The Queen (1891) 17 VLR 329; St Leonards Municipality v Williams (1966) Tas SR 166; 15 LGRA 62 and John v Rees [1970] Ch 345, go a long way to establishing this view. It is also consistent with the general law that normally a person must be consulted on his rights, unless he has appointed agents to exercise those rights for him.
However, it seems to me that in the instant case the consensual compact between the parties has moved away from the position that only a meeting at which everybody is present is effective to act. The body consists of at the moment almost 200 members, there is a written constitution, which envisages that there will be an annual general meeting at which apologies can be received, which would be quite otiose if members' meetings would only be efficacious if all were there and the trappings of a normal corporate meeting that minorities are protected by the business of the meeting being specified in the notice at least a certain time before the meeting. This usually is done so that people can make up their minds whether they will attend a meeting or not because if the business does not interest them they might stay away. This runs contrary to there being a rule that only meetings attended by the whole of the members can be effective. It is quite clear that when considering the consensual compact of a body such as this, one can look to the activities of the members after the consensual compact was made. Lord Lyndhurst's Act has not, of course, been adopted in New South Wales, but the law as to dissenting chapels that was worked out in England in the first part of the nineteenth century in cases such as Attorney-General v Murdoch (1852) 1 De G M & G 86; 42 ER 484, at 109; 494, makes it quite clear that one can look at even relatively recent conduct to get some light as to what the real consensual compact was. Indeed, even cases such as John v Rees itself show that not only does one look at the consensual compact through the written rules but also through unwritten usages. It was significant really that apart from being put as a back-up submission the proposition that all members had to agree in everything was only faintly raised in submissions in these proceedings.
45In Ball v Pearsall, the evidence disclosed that there were approximately 200 members of the unincorporated association and more than 100 attended the meeting that was the subject of the challenge. The vast majority of those attending, approximately 100, left the meeting at a vital stage leaving approximately 20 members to purportedly conduct the meeting of the association. It seems clear from the discussion later conducted by Young J that a meeting of more than 100 members, in the absence of a specific quorum rule, was sufficient to constitute a quorum and to conduct the business of the association but when the number of attendees was reduced to a relatively small number of members, no quorum existed.
46The case of Trustees of the Roman Catholic Church for the Archdiocese of Sydney v Ellis and anor (2007) 70 NSWLR 565 dealt with the issue of tort and the liability of unincorporated associations.. Mason P (Ipp and McColl JJA agreeing) made observations about the nature of unincorporated associations, stating at [47]:
A corporation has perpetual succession and is liable to sue and be sued. An unincorporated association that is not a partnership is a group of individuals associated together for some lawful purpose other than profit that may or may not have a rigid constitution or a fixed and finite membership. Procedurally, it cannot (at common law) sue or be sued in its own name because, among other reasons, it does not exist as a juridical entity.
47In dealing with the issues that have arisen, some assistance is provided by the judgment Reed AJ of the South Australian Supreme Court in Re Unley Democratic Association [1936] SASR 473. In that case, an unincorporated association had purchased a meeting hall to facilitate its purpose to advance the cause of democracy. Over the years its membership fell away dramatically until there were only four members remaining. The trustees had sold the meeting hall and the court was to determine who was entitled to the proceeds of the sale. There had not been any resolution for the dissolution of the association and the rules provided that five members constituted a quorum. In those circumstances, the affairs of the association were not formally wound up and the association was not dissolved. Rule 19 dealt only with dissolution and provided that the association could not be dissolved so long as five members remained who wished the association to continue. There was no capacity for the remaining four members to hold a meeting and no capacity for five members to require the association to continue. His Honour resolved the situation at p 480 as follows:
It seems to me that the solution in these circumstances is that the law implies a condition resolutive of the contract, that condition being that when the number of members should fall below the necessary to carry on the affairs of the association in accordance with the rules for the time being enforced, the association should be dissolved.
48After considering authority in relation to "frustration", at p 481 his Honour continued:
In this case I infer from a consideration of the whole of the circumstances of the Association that the parties to the rules, both the original members and those who subsequently became members, contemplated that the basis of their contractual relationship was that there should be at least the minimum number of members necessary to carry on the affairs of the Association in accordance with the rules from time to time enforced. This is in accordance with the principle annunciate by Lord Loreburn in F A Tamplin Steamship Co v Anglo-Mexican Petroleum Products Co. [1916] 2 A C 397 at pp. 403-404, where he said:
A Court can and ought to examine the contract and the circumstances in which it was made, not of course to vary, but only to explain it, in order to see whether or not from the nature of it the parties must have made their bargain on the footing that a particular thing or state of things would continue to exist. And if they must have done so, then a term to that effect will be implied, though it be not expressed in the contract. In applying this rule it is manifest that such a term can rarely be implied except where the discontinuance is such as to upset altogether the purpose of the contract.
Relying on these authorities, his Honour held that the association was dissolved from the time when only four members remained.
49It can be seen from the above discussion that there was no hard and fast principle that for an unincorporated association to be established there had to be written rules. The written submissions for the HSU failed to recognise that the so-called six principles (referred to in the Conservative Party case) identifying an unincorporated association contained some principles that were "essential", namely, a contract and others that were "usual", or, providing evidence of the contract. Under English law the rules of the association could be oral or there may be no such rules at all with the contract to be inferred from the surrounding circumstances as with the Free Church of Scotland case. The HSU's submissions overstate the proposition to the extent that they suggest that the absence of rules and in particular, written rules, meant that the applicant was invalidly formed as an unincorporated association. Essentially, all that is required for the formation of an unincorporated association is a group of people with a common purpose: as found in Kibby, a form of combination of persons with a common interest or purpose with a degree of organisation or continuity, will suffice. No public notice of the meeting is required. These matters will be discussed later in this decision under the heading "Was the Applicant Organisation Validly Formed."
50As explained above, in dealing with the authorities relied upon by the HSU, none of them appear to have any direct relevance to the present case and none of them would constitute a binding authority for the proposition that an unincorporated association without rules is a nullity and does not exist.