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[2016] VSCA 44
Court of Appeal (Vic)
2016-03-17
Robson J, Sifris J, Tate JA
Original judgment source is linked above.
ADMINISTRATIVE LAW - Validity of general meeting of the Framlingham Aboriginal Trust where a quorum not present - Requirement for a quorum is one-half of the persons entitled to vote at the meeting who are residents of the reserve on the day the meeting is called - Whether Supreme Court has the power under the Aboriginal Lands Act 1970 to dispense with the quorum requirement - Whether Court's discretionary power enlivened in the circumstances of the case - Frustration of previous orders of the Court - Different judge made supplemental orders - Orders take effect as orders of the Court - Whether rights under the affected - , and - , and 32(1) - Leave to appeal granted - Appeal dismissed.
Introduction and summary .........................................................................................
The statutory scheme ...................................................................................................
Complaint before Robson J about conduct of meeting of 16 December 2013 .......
The application before Sifris J on 1 October 2014 .......................................
The meeting of 10 November 2014 and the return before Sifris J on 1 December 2014 ..................................................................................................
Grounds of appeal ........................................................................................................
Does s 27 give the Court power to declare a meeting valid in the absence of a quorum? ..........................................................................................................................
Was the power under s 27 enlivened before Sifris J? ....................................
Did the discretion miscarry? ..................................................................
Were Charter rights affected? .................................................................
Conclusion ........................................................................................
1 This matter raises the question of whether the Supreme Court can make orders dispensing with a quorum requirement prescribed by statute for a general meeting of the Framlingham Aboriginal Trust ('the Trust'). It also raises the secondary question of whether, if the Court has the relevant discretionary power, it was enlivened in the circumstances of the case.
2 The questions arise in the context of an application for leave to appeal from orders made by a judge of the Trial Division of this Court (Sifris J)[1] in relation to the exercise of powers under the Aboriginal Lands Act 1970 ('the Act') in a dispute involving the operation of the Trust which administers the Framlingham reserve ('the reserve')[2] in South Western Victoria. The issue before Sifris J was whether the Court has the power to declare as valid a general meeting convened by Receivers and Managers ('the Receivers') appointed to the Trust, despite the absence of a quorum and whether the circumstances justified an exercise of the power. The quorum requirement is one-half of the persons entitled to vote at the meeting who are residents of the reserve on the day the meeting is called.[3] The source of the Court's power to declare valid a meeting held without a quorum is argued to lie in the power conferred under the Act to make orders as the Court thinks fit in response to a complaint that the affairs of the Trust are being conducted in a manner oppressive to one or more members of the Trust, or to grant relief where the Act has been contravened.[4] In particular the issues raised are: Does the statutory power to grant relief to complainants empower the Court to dispense with the quorum requirement imposed by the Act? If so, was the power properly exercised in the circumstances of the case?
3 Sifris J held that the power to grant relief extended to directing that a meeting could be held in the absence of a quorum, and declaring valid the meeting convened by the Receivers at his direction, on 10 November 2014, that had been so held. He considered that the non-attendance of some resident members of the Trust, with the result that a quorum was not achieved, frustrated the proper and effective implementation of previous orders of the Court made by Robson J and himself[5] which had required the Receivers to convene an annual general meeting in order to appoint a new Committee of Management ('the Committee') to administer the Trust. Sifris J held that the Court's broad discretionary power under the Act to make such orders as it thinks fit includes the power to waive the requirement for a quorum. He held that the power was enlivened because the orders of the Court which had been frustrated were based upon findings of both oppression and contraventions of the Act. He took the view that the quorum requirement is simply a machinery type provision to enable meetings to proceed with minimum inconvenience, and he had directed that the members of the Trust be given a warning of the possible validity of a meeting without a quorum.[6] On 16 December 2014 Sifris J declared that: (1) the meeting held on 10 November 2014 be deemed to have been a valid and effective meeting of the Trust notwithstanding the absence of the prescribed quorum; and (2) the election of various members to the Committee at that meeting be deemed to have been a valid and effective election.
4 Geoffrey (Possum) Clark-Ugle ('Clark-Ugle') applies for leave to appeal from the orders of Sifris J made 16 December 2014. Clark-Ugle had been elected a member of the Committee and became its chairman on 3 October 2011. He remained in that position until 20 August 2014 when Robson J declared that all seven positions on the Committee were vacant and appointed the Receivers.[7] Should leave to appeal be granted, Clark-Ugle seeks: (1) a declaration that the general meeting of the Committee on 10 November 2014 was invalid by reason of the absence of a quorum; and (2) an order that the Committee that existed prior to an earlier 'proposed general meeting on 16 December 2013' be reinstated.[8] As mentioned, Clark-Ugle was a member of that earlier Committee and its Chairman.
6 The Victorian Minister for Aboriginal Affairs ('the Minister') intervened by leave.[12]
7 For the reasons set out below, I consider that leave to appeal should be granted and the appeal should be dismissed.
8 The Trust was established as a body corporate by the Act to own and operate the reserve under the supervision of the Office of Aboriginal Affairs Victoria ('the OAAV'). The Trust receives State funding for its activities. The Act commenced on 8 December 1970. Under s 3 of the Act, the Minister was required to prepare a register showing the names of all Aboriginal persons who were resident on the reserve on 8 December 1970 and who had been resident on the reserve on 1 January 1968[13] or were children born before 8 December 1970 whose mothers were resident on the reserve on 1 January 1968.[14] Under sub-s (3) of s 3, the Minister was empowered to omit from the register the name of any person who was a member of a family in respect of whom the Minister had made a grant for the purpose of purchasing a dwelling-house outside the reserve. The register was to be exhibited at the reserve for two months for objections to be raised.
9 Under s 8(a) of the Act, on a day fixed by the Governor in Council ('the appointed day') the persons whose names appeared on the register published in relation to the reserve, and who were still living, together constituted a body corporate to be known as the Trust. As Robson J noted, although called a 'trust', the Trust is a body corporate incorporated pursuant to the Act, the members of which hold shares in the Trust much like a company.[15] Under the Act, the undertaking of the Trust was divided into shares and each of the first members who were adults were entitled to 1000 shares, while each infant was entitled to 500 shares.[16] The total number of shares was determined accordingly. Only shareholders could be members of the Trust, pursuant to s 12(7):
Only those persons whose names appear from time to time in the register of members as the owners of any shares shall be members of a Trust.
10 The Trust was required immediately after its incorporation to establish a register of members showing the name, address and the extent of the shares held by each member.[17]
11 Although the shares in the Trust are personal property and are transferable,[18] there are restrictions on the persons to whom shares can be transferred. Pursuant to s 14(2), a member of the Trust may only transfer his or her shares:
(a) to the Trust;
(b) to another member;
(c) to the Crown in right of the Commonwealth or the State; or
(d) to a person whom the Trust believes to be -
(i) the husband or wife, or a child or remoter issue, brother, sister or parent of the member;
(ii) a brother or sister of a parent of the member; or
(iii) a child or remoter issue of a parent of the member, or of a brother or sister of a parent of the member:
Provided that for the purposes of this paragraph, any natural blood relationship shall be treated as being legitimate.
12 It is noteworthy that the restrictions specified by s 14(2) on the transfer of shares do not include any residential requirement; that is, they do not include any requirement that shares be transferred to residents of the reserve.[19] Not all residents are shareholders (members of the Trust) and not all shareholders are residents.
13 Section 15(1) of the Act provides that at the first general meeting of the Trust seven persons shall be elected to form the Committee. Those persons were to hold office with staggered terms of tenure:
(a) two shall be elected to hold office until the second annual general meeting;
(b) two shall be elected to hold office until the third annual general meeting; and
(c) three shall be elected to hold office until the fourth annual general meeting.
14 Robson J held that this procedure of 'staggered terms' or 'staggered elections' was a once-only arrangement that applied to the first general meeting and thereafter had no further application.[20]
15 Section 15(2) provides that the members of the Trust shall from time to time in general meetings, as may be required, elect a person to fill any vacancy on the Committee. Section 15(3) provides for a uniform (and not staggered) period of tenure of office until the third annual general meeting following the member's election unless filling a staggered vacancy:
Any person elected to fill a vacancy arising by expiration of the term of office for which a member was elected shall hold office until the third annual general meeting following his or her election, and any person elected to fill a vacancy otherwise arising shall hold office for the balance of the term of office of the member he or she replaces.
16 It is not necessary for members of the Committee to be either residents or shareholders. Section 15(4) provides that it 'shall not be necessary for a member of the committee of management of a Trust to be a member of the Trust'.
17 The Committee is empowered to act on behalf of the Trust and to exercise the powers and functions of the Trust. Section 16(1) provides:
Subject to this Act, the powers and functions of a Trust may be exercised on its behalf by its committee of management and not otherwise, but a committee of management shall comply with the terms and conditions of any resolution relating to the powers and functions of the Trust passed at a general meeting of the Trust.
18 Section 22 imposes the requirement that the Trust hold an annual general meeting within six months of the end of each financial year.[21] It also sets out the procedure for the Secretary of the Trust to call general meetings of the Trust. The Trust may hold a general meeting at any time.[22] Section 22(3) provides that the Secretary 'shall call a general meeting of the Trust if called upon to do so by a requisition in writing under the hands of not less than one-quarter of those members of the Trust who are not infants'. Non-residents may thus requisition that a meeting be called. Section 22(4) provides for 14 days' notice to be given of a general meeting:
General meetings of a Trust shall be called by giving at least fourteen days' notice of the meeting in writing to every member of the Trust (not being an infant) who has a place of address shown against his or her name in the register of members.
19 The procedure at general meetings is governed by s 23. Section 23(4) specifies the quorum in terms that impose a residency requirement:[23]
The quorum for a general meeting shall be one-half of the persons entitled to vote at the meeting who are residents of the reserve on the day the meeting was called in accordance with section 22(4).
20 Section 23(4) had been amended in 2004 to insert the words 'who are residents of the reserve on the day the meeting was called in accordance with section 22(4)'.[24] In the Explanatory Memorandum for the Aboriginal Lands (Amendment) Bill 2004 ('the Bill') it was noted that this amendment was 'intended to make it easier for a Trust to hold valid general meetings, while also increasing the opportunity for resident members to participate in those meetings.'[25]
21 The Minister remarked during his second reading speech introducing the Bill that the amendment was intended to reflect the significance of the rights of Aboriginal communities to make decisions with respect to land they occupy:
In amending the Aboriginal Lands Act, the government is very mindful of the original principles on which the act was based, namely, the rights of the Aboriginal communities involved to own and make decisions about the lands they occupy.
The act was a landmark law in 1970. It recognised the rights of the indigenous communities at Lake Tyers and Framlingham to own the land, and to control decisions about that land. To these ends, the act vested the reserve lands in two trusts, and provided for local occupants to hold personal shares in those trusts. To manage and make certain decisions about the land, the act provided for a committee of management for each trust to be elected by trust members.
This model has remained in place for the last 30 years. However, its effectiveness in practice has diminished over time due to a number of factors. In particular, local participation in decision making at Lake Tyers has declined due to the movement of shareholders out of the area, and the transfer of shares to non-residents. Because participation is linked to shareholding, there has been a decline in residents' relative capacity to participate in decision making, particularly in general meetings. In addition, the opportunity for trust members to be involved in the governance of the Lake Tyers Aboriginal Trust has been limited because there has not been a general meeting of the trust for some years. This is because of difficulties with the legislation. It has also had an impact on the ability of the trust to meet the governance requirements in the act.[26]
22 The Minister observed that the quorum requirement was intended to enhance the participation of resident members of the Trust:
The government recognises that effective community renewal requires effective community participation. To this end, the bill amends the procedure for general meetings of a trust to make it easier to hold valid meetings, and at the same time to increase the participation of resident members of the trust. This provision will apply to both Lake Tyers and Framlingham.
The act currently requires the trusts to hold annual general meetings to elect committee members when vacancies arise, to present audited books of account and other reports, and to vote on any resolutions put forward by members. At Lake Tyers, annual general meetings have not taken place in recent years. The main reason is a difficulty in reaching the quorum requirement for a valid general meeting, which is currently one-half of all shareholders. Because many shareholders live outside of Lake Tyers, this requirement has been difficult to meet.
To make it easier to hold valid meetings, the bill changes the quorum requirement from one-half of all trust shareholders to one-half of trust shareholders who are residents. Only those shareholders who are recorded on the share register as a resident of the Lake Tyers or Framlingham reserve at the time the meeting is called, will be eligible to be counted as residents for this purpose. The bill also requires the share register to be maintained to ensure that it records the addresses of current shareholders.[27]
23 Robson J noted that at the time of the hearing before him, there were six members of the Trust residing on the reserve,[28] while Sifris J noted in his reasons that at that time there were 19 members of the Trust of whom eight were residents of the reserve.[29] On the application for leave to appeal, senior counsel for Clark-Ugle informed the Court that an audit of the register by the Receivers had revealed that there were eight resident members, although by the time of the hearing of the application there were seven.
24 Section 23(2) provides for questions arising at general meetings to be resolved by a majority of votes of members present at the meeting. Each member present is entitled to one vote unless a poll is demanded in which case s 23(3) provides that the number of votes to which a member is entitled is determined by the number of shares the member owns. There is no residency requirement imposed on the determination of resolutions. This is relevant in determining the significance of the residency requirement for a quorum.
25 Section 23(2) reads:
Unless on any question submitted at a general meeting to a vote a poll is demanded by not less than five persons present, or by any person or persons entitled to exercise not less than one-tenth of the total votes of those present, every member present shall be entitled to one vote only, and a resolution shall be carried if a majority of the votes is in favour thereof.[30]
26 Section 23(3) reads:
If a poll is demanded in accordance with subsection (2), the number of votes to which each member is entitled shall be determined by the number of shares the member owns.[31]
27 The Minister has the power to intervene to require the Trust to comply with the Act under s 23A:
If the Minister believes on reasonable grounds that a Trust has failed to comply with a provision of this Act, the Minister may, by notice served on the Chairperson of the Trust, require the committee of management of the Trust to take the action specified in the notice, within a reasonable period of time specified in the notice, for the purpose of complying with this Act.
28 The Minister may also appoint an administrator of the Trust under s 23B where he or she considers that there may be relevant grounds for an appointment. The 'relevant grounds' include circumstances where the Committee has failed to take the action specified in a s 23A notice and failed to provide an explanation to the reasonable satisfaction of the Minister;[32] or where the members of the Committee have acted in the affairs of the Trust in their own interests rather than in the interests of the members;[33] or where the appointment is required in the interests of the members of the Trust or the residents of the reserve.[34] The administrator becomes responsible for the conduct of the affairs of the Trust and may exercise the powers and functions of the Committee.[35] Where an administrator is appointed, he or she is required to establish and then consult with an advisory committee which includes at least three members of the former Committee and two persons who were not members of the Committee but who are residents of the reserve.[36] There is no requirement that those residents be members of the Trust. At the end of the period of administration a general meeting is to be convened and held, in accordance with the Act, for the purpose of electing seven persons to form the Committee.[37]
29 Section 27 empowers the Supreme Court to grant relief to persons in response to a complaint of oppression or to persons aggrieved by a contravention of the Act by the Trust:
(1) A member of a Trust who complains that the affairs of the Trust are being conducted in a manner oppressive to one or more of the members (including himself or herself) may apply to the Supreme Court for an order under this section and, if the Court is of [the] opinion that the affairs of the Trust are being so conducted and that it would be just and equitable to make an order under this section, the Court may make such order as the Court thinks fit whether for regulating the affairs of the Trust in future or for the purchase of the shares of any members by other members or by the Trust, or otherwise.
(2) Any person (whether a member of a Trust or not) who is aggrieved by anything which the Trust has done or failed to do in contravention of this Act may apply to the Supreme Court for an order under this section and, if the Court is of the opinion that the Trust has contravened this Act and that the person aggrieved has suffered injustice on that account, the Court may make such order as appears to the Court to be necessary to give proper relief to the person aggrieved.[38]
Complaint before Robson J about conduct of meeting of 16 December 2013
30 The orders of Sifris J from which the application for leave to appeal is brought were made against the background of Robson J's decision in response to a complaint of oppression by the respondents.
31 The complaint of oppression concerned the manner in which Clark-Ugle and the Trust conducted an annual general meeting on 16 December 2013, including the determination about the number of vacancies on the Committee which were open to be filled; who was entitled to nominate for those positions; the manner of, and timing for, filing those nominations; who was entitled to attend and vote at the meeting; and whether the Committee appointed at the 16 December 2013 meeting was validly appointed. The respondents argued that the conduct they complained of was oppressive and, if the complaint was made out, Robson J was invited to exercise the Court's powers under s 27 of the Act.[39]
32 In the years preceding the 16 December 2013 meeting, the affairs of the Trust had been in a state of disarray. Following a review by the OAAV of the financial affairs and governance of the Trust between September 2010 and March 2011, it was found that the Trust had no audited financial accounts, or minutes of meetings or other documents showing that regular Committee meetings had been held. Nor had the Committee observed accurately the staggered terms requirement prescribed by the Act. The members of the Committee, during the time of the OAAV's review, were: Lionel Harradine, Trudy Clark, Maisie Davis, Violet Mary Clark, Violet Jennifer Clark, Brenda Chatfield, and Aaron Clark.[40]
33 The OAAV met with the members of the Trust, including the members of the Committee, and asked the Committee to step down because of serious problems identified during OAAV's investigation, including allegations of criminal conduct by some of them.[41] All but one member of the Committee refused to step down. Subsequently a general meeting was convened on 3 October 2011 at the request of Clark-Ugle and various other members of the Trust. Robson J held that this meeting was a general meeting and not an annual general meeting, the difference being that an annual general meeting is one where the audited accounts are presented and the terms of office of members of the Committee expire.[42]
34 At the meeting of 3 October 2011 four of the Committee positions were declared vacant, while two positions had been vacated by reason of resignations, leaving Brenda Chatfield (also known as Brenda Clark) as the only remaining member of the Committee. A new Committee was elected by the shareholders with each member to fill the vacancy of the previous member for the balance of his or her term (save for Brenda Chatfield). The members of the new Committee were: Jim Berg (to fill the vacancy of Lionel Harradine for the balance of his term as chairman); Kyeema Penrith (secretary, to fill the vacancy of Trudy Clark for the balance of her term as secretary); Tim Chatfield (to fill the vacancy of Maisie Davis for the balance of her term); Violet Mary Clark (to fill the vacancy of Aaron Clark for the balance of his term); Shirley McGuiness, also known as Shirley Clark (to fill the first current vacancy for the balance of that term); Clark-Ugle (to fill the second current vacancy for the balance of that term) and Brenda Chatfield.
35 However, the new Committee was unable to ascertain what terms of office the persons removed from the Committee had been serving as no records had been kept describing the length of terms of Committee members before 3 October 2011.[43]
36 On 4 October 2011 the Committee held its first meeting. Letters were issued to all shareholders of the Trust regarding the changes to the Committee. At the next meeting, on 31 October 2011, the Committee discussed the official share register of the Trust. One of the first acts by the Committee was to identify an accurate official share register for the Trust that would be recognised by the OAAV. At the 31 October 2011 meeting, the Committee unanimously agreed that the share register dated 8 June 2010 was a true and accurate account of the share register of the Trust.[44]
37 However, allegations were later made in respect of the ownership of shares in the Trust which called into question the accuracy of the share register as at 8 June 2010. Before May 2002, Geoff Clark[45] had been the registered holder of 2000 shares in the Trust. He alleged that he had transferred 1900 of his 2000 shares to his son, Jeremy Clark, but the 8 June 2010 register did not acknowledge this transfer. Geoff Clark had been declared bankrupt on 1 June 2009.[46] Jeremy Clark deposed[47] that his father transferred 1900 shares to him in or about 1 May 2002 by instrument of transfer which was approved and registered by the Committee at that time. Jeremy Clark said that in about August 2011, he executed a similar instrument to transfer 900 shares to his brother, Aaron Clark. Jeremy Clark was registered as a shareholder, at the latest, from 1 September 2011. A version of the share register prepared in 2011 showed the relevant respective shareholdings as follows: Geoff Clark (100 shares), Jeremy Clark (1000 shares); and Aaron Clark (900 shares).[48]
39 Litigation arose between members of the Trust. A settlement deed was entered into between Clark-Ugle and Aaron Clark and Jeremy Clark and Tim Chatfield on 23 April 2013 in respect of two proceedings ('the settlement deed'); one brought by Veronica Harradine against the members of the 2011 Committee with respect to her alleged ownership of shares ('the Harradine proceeding'), and one brought by the 2011 Committee in relation to the recovery of Trust moneys incorrectly or inappropriately transferred during the tenure of the previous Committee ('the Kirrae proceeding'). In the settlement deed, cl 6 represented a recognition of the shareholding of Geoff Clark, Jeremy Clark, and Aaron Clark, subject to any claim of the trustee in bankruptcy for Geoff Clark ('the trustee in bankruptcy'):
The parties to this deed acknowledge and agree that, in relation to the members of the Trust;
...
(c) subject to any claim that the trustee in bankruptcy of Geoffrey Wayne Clark may have in relation to the shares of Geoff, Jeremy or Aaron Clark, the respective shareholdings of each of Geoff, Jeremy and Aaron Clark are as follows: Geoff (100 shares); Jeremy (1,000 shares) and Aaron (900 shares).[51]
40 It was also a term of the settlement deed that a general meeting be held to consider the following resolutions: '(a) that the appointment of the present committee of management of the Trust made on 3 October 2011 be ratified; and (b) that all decisions, resolutions and actions of the current committee since its appointment on 3 October 2011 be ratified.'[52]
42 An annual general meeting was organised for 16 December 2013.
43 The trustee in bankruptcy advised Clark-Ugle that he would not attend the 16 December 2013 annual general meeting, and nor would he seek to exercise any votes in respect of the 100 shares held by Geoff Clark. In relation to the remaining 1900 shares held between Jeremy and Aaron Clark, the trustee in bankruptcy advised that his investigations were still continuing.
44 Clark-Ugle wrote to Jeremy and Aaron Clark and told them that because there was a 'dispute' between them and the trustee in bankruptcy, the Trust was unable to recognise that they had any entitlement to nominate, vote or attend meetings of the Trust. Aaron Clark's attempt to nominate himself for the Committee was marked by Clark-Ugle as 'invalid due to shares being in dispute'. On 16 December 2013 Aaron Clark was prevented from entering the meeting venue and following a verbal altercation with the Trust's secretary, Kyeema Penrith, he was told by Clark-Ugle that he was not entitled to enter the meeting. He then left with his solicitor.
45 Robson J held that as at 16 December 2013 there was no dispute between Jeremy and Aaron Clark and the trustee in bankruptcy; only an investigation.[55] As at 16 December 2013 the trustee in bankruptcy had not established any claims in relation to the shares held by Jeremy or Aaron Clark, or established that they were disabled from dealing in the shares registered in their names, including voting at the meeting. (Indeed, before May 2014, the Trustee had not asserted a claim to the shares.)[56] What the trustee in bankruptcy had told the Trust was that 'his investigations are still continuing in respect of the purported transfer of shares by the bankrupt [Geoff Clark] to Jeremy Clark (some of which were ultimately transferred to Aaron Clark)'.[57] Robson J held that the proviso to cl 6 of the settlement deed[58] 'was intended to be enlivened if and when the trustee had an established claim to the shares'[59] and that until the trustee had an established claim 'Jeremy and Aaron were entitled to enjoy the rights attaching to the shares'.[60]
46 He held that the Trust and Clark-Ugle were not entitled to deny Jeremy and Aaron Clark the right to nominate candidates for the Committee or to attend or vote at the 16 December 2013 annual general meeting:[61]
[W]here no established claim was made by the trustee [in bankruptcy] that the shares had vested in him or that he was entitled to exercise the votes, there was no ground for denying the registered owners the full rights of entitlement. The ultimate fate of the shares may have been uncertain. But that state of uncertainty did not, under the Act or the terms of the deed, disentitle the registered owner from exercising the rights attached to the shares, to nominate, attend meetings and vote at meetings.[62]
47 Robson J also noted that before 16 December 2013 the Committee had resolved to reintroduce staggered terms of office for its members. The Committee fixed staggered terms of office by resolution dated 22 November 2013 so that two of the incumbent members (Violet Mary Clark and Shirley McGuiness) were appointed until the 2014 annual general meeting, three of the incumbents (Clark-Ugle, Brenda Chatfield, and Kyeema Penrith) were appointed to hold office until the 2015 annual general meeting and there were two vacancies to be filled until the 2016 annual general meeting.[63] As Violet Mary Clark and Shirley McGuiness had been elected in 2011, this meant that they would stay in office until the third annual general meeting after their election.[64] As Clark-Ugle, Brenda Chatfield and Kyeema Penrith had been elected in 2011 this meant that they would stay in office until the fourth annual general meeting after their election.[65] Robson J observed that 'Mr Clark-Ugle denied that he saw anything odd in giving himself a four year term as opposed to a three year term'.[66]
48 The effect of this resolution was that only two vacancies on the Committee were to be voted on at the 16 December 2013 meeting.[67] A notice outlining the Committee's proposal for staggered terms, and noting that two positions were open to be filled, was sent to all the Trust members when the 16 December 2013 meeting was convened.
49 There was a challenge to the reintroduction of staggered terms at the 16 December 2013 meeting by Jim Berg and Tim Chatfield. In early December 2013 Clark-Ugle and two officers of the Trust took legal advice from senior counsel[68] and were advised that the reintroduction of the staggered terms was consistent with the intention of the Act. A letter was sent to Jim Berg indicating that advice had been given that the Committee had correctly approached the issue of elections and asking him to withdraw his resolution challenging the proposal. On 16 December 2013 Ronald Chatfield[69] and Joanne McGuiness were elected to the Committee.
50 Robson J held that the approach taken at the 16 December 2013 annual general meeting to the election of members of the new Committee was incorrect. He held that there was no basis in the Act for taking the approach the Committee took; the procedure under s 15(1) for staggered terms was a once-only arrangement that applied to the first general meeting after the Trust was established.[70] By 2011 it had no application. After the first general meeting (which may have been December 1972),[71] the process under s 15(3) applied, namely, election of members of the Committee for approximately uniform terms of three years (unless a vacancy was being filled with respect to an expired term).[72] There was thus no statutory support for the reintroduction, by means of an agreement between the members of the Trust, of staggered terms for members of the Committee after the first general meeting.
51 Robson J held that if the requirements of s 15(1) had been observed before 2011, by 2013 there would have been seven (and not two) vacancies and the term of office of the current members of the Committee would have expired:
If s 15 had been properly observed prior to October 2011, then either two or three members' terms of office were due to expire at the 2011 annual general meeting, either two or three members' terms were due to expire at the 2012 annual general meeting, and two or three members' terms of office were to expire at the 2013 annual general meeting. Thus, under the Act, there would have been seven vacancies to be filled at the 2013 annual general meeting.
The seven successful candidates would all be filling a vacancy arising by the expiration of the term of office for which they were elected. That is, the term of office of the current members of the committee would have expired.
...
Accordingly, at the annual general meeting in 2013, under s 15(3), each of the seven members elected to fill a vacancy arising by expiration of the term of office for which the member was elected, would be elected until the third annual general meeting. ...
[W]hatever be the situation, there was no basis in the Act for electing two members of the committee to hold office until the annual general meeting in 2014, three to hold office until the 2015 annual general meeting and two until the 2016 annual general meeting.[73]
52 Robson J found that the terms of all the members of the Committee elected in October 2011 had been exceeded and the Committee appointed at the December 2013 annual general meeting was not properly appointed.[74]
53 Robson J observed that the Act assumed that the procedure for staggered terms and regular annual general meetings would be faithfully observed, but it made no provision for the situation where, as in 2011 and 2012, an annual general meeting was not held with the consequence that elections were not held in accordance with the Act[75] and 'members of the committee purported to hold office in excess of the terms provided for in the Act'.[76]
54 He concluded that the conduct of the Committee, the Trust, and Clark-Ugle in inappropriately extending the term of members of the Committee and excluding Aaron and Jeremy Clark from nominating, attending or voting at the annual general meeting had harmed the interests of Aaron and Jeremy Clark who had suffered injustice on that account. He held that the affairs of the Trust were being conducted in a manner that was oppressive to Aaron and Jeremy Clark. He accepted that the wording of s 27(1) of the Act was similar to that used in s 186 of the now-repealed Companies Act 1961 which dealt with oppression of shareholders in a company.[77] Applying the principles used in the latter context,[78] he found that it was just and equitable for the Court to make an order under s 27(1) of the Act.[79] He said:
In my opinion, it is probable that the members of the committee were aware that they were keeping themselves on the committee longer than they were allowed to be on it, and they probably did so to advance their own interests. Further, the conduct of the defendants in excluding Aaron and Jeremy Clark from nominating, attending or voting at the annual general meeting was and is oppressive to Aaron and Jeremy Clark. I am satisfied that the oppression results from overbearing acts and attitudes on the part of the defendants. The conduct has had a detrimental effect on the interests of Aaron and Jeremy Clark in the governance of the Trust.
Having regard to the defendants' conduct [the Trust and Clark-Ugle] as a whole in all the circumstances surrounding the administration of the Trust, I consider that their conduct has been burdensome, harsh and wrongful to Aaron Clark and Jeremy Clark. The defendants initially agreed to recognize their shareholding then reneged on the terms of settlement and denied them the benefits of their shareholding.[80]
55 He also held that by denying Aaron Clark and Jeremy Clark the right to nominate, attend and vote in relation to the election of members of the Committee, the Trust had contravened the Act and that this had a detrimental effect on the interests of Aaron and Jeremy Clark. The Court's powers under s 27(2) were therefore enlivened.[81]
56 He considered that the proper way to rectify the injustice was for fresh elections to be held for all seven positions on the Committee at an annual general meeting.[82] He said:
Under s 27(1) the Court may make such orders as the Court thinks fit for regulating the affairs of the Trust in the future or for the purchase of the shares of any member by other members or by the Trust or otherwise. Under s 27(2) the Court may make such order as appears to the Court to be necessary to give proper relief to the person aggrieved by the contravention of the Act.
In my opinion the proper way to rectify the injustice caused to the plaintiffs by the way the defendants held the annual general meeting in December 2013 is to hold fresh elections. The plaintiffs have sought orders that an election be held for all seven positions on the committee, at an annual general meeting to be conducted by an officer of the Department of Aboriginal Affairs to be nominated by the secretary of the Department. I consider that this is an appropriate course.[83]
57 He further held that it was appropriate for an order of the Court to be made for staggered elections to be re-introduced to properly regulate the affairs of the Trust in the future, 'despite s 15(1) having been spent'.[84] This reflected the draft minutes of orders sought. He said:
Such an order will permit the Trust to continue as it should have if the Act had been properly observed in the past.[85]
58 On 20 August 2014 Robson J declared that the purported annual general meeting held on 16 December 2013 was contrary to the Act, was conducted in a manner oppressive to one or more members of the Trust, and was null and void and of no effect; that all seven positions on the Committee were vacant until filled by a further poll; and that all resolutions of the purported Committee from 6 August 2014 until the date of judgment (20 August 2014) were void and of no effect. He appointed the Receivers with all the powers and functions of the Committee, and ordered that there be an election conducted by the Receivers to fill all seven positions as members of a new Committee.[86] He also declared that Aaron and Jeremy Clark were entitled to vote in the forthcoming election and to be nominated as candidates for the Committee, subject to any rights in the trustee in bankruptcy established by court order or by agreement with Jeremy and Aaron Clark before the election. He directed that an annual general meeting be convened not more than 60 days after 20 August 2014 'to be held in place of the [16 December] 2013 Meeting, at which shall be conducted the said election to fill all seven positions as members of the Committee'.[87] The Receivers were required to collect all completed ballot papers, count them and then declare the result of the poll 'allocating to each vote a weight equal to the number of shares in the Trust of which the member casting that vote is registered as the owner'.[88] He directed that the Receivers were to continue in office until the declaration of the poll.[89] Robson J also directed a method for determining the length of office for each of the seven members of the new Committee:
The two persons receiving the lowest number of votes in the poll conducted by the Receivers shall hold office until the Annual General Meeting of the Trust to be held in 2015, the two persons receiving the next lowest number of votes shall hold office until the Annual General Meeting of the Trust to be held in 2016 and the three persons receiving the highest number of votes shall hold office until the Annual General Meeting of the Trust to be held in 2017.[90]
59 Robson J granted liberty to apply to any party, as well as to the Receivers and to the OAAV.[91]
60 The Receivers took the necessary steps to convene an annual general meeting on 24 September 2014. However, on that day the meeting did not proceed because the number of resident members of the Trust in attendance was less than the fifty per cent of resident members on the reserve on the day the meeting was called, as required by s 23(4) of the Act, with the result that a quorum was not achieved.
61 It later emerged before Sifris J that seven out of the eight resident members entitled to attend and vote at the annual general meeting called for 24 September 2014 deliberately decided not to do so.[92]
The application before Sifris J on 1 October 2014
62 The matter was brought back before Sifris J on 1 October 2014 pursuant to the liberty to apply extended by Robson J.[93] His Honour extended the Receivers' appointment until further order, and directed that there be an election within 60 days of 1 October 2014 to fill all seven positions on the Committee. He ordered that the Receivers prepare a register of members of the Trust taking account of any transfer of shares which had occurred since 26 November 2013 to be used as the roll of voters for an annual general meeting he directed to take place. He made directions for notification of the annual general meeting to be made to each person shown on the register as a shareholder. He made an order that the 'AGM or meeting be held even if there is no quorum present'.[94] Paragraph 8(ii) of his orders directed the Receivers to send by post to each person named in the register as a shareholder a notice 'specifying the date of the AGM fixed by the Receiver[95] and advising that, pursuant to an Order of this Court, an election will be conducted at the AGM for all seven positions on the Committee'. He directed that the notice make it clear that the meeting would take place in the absence of a quorum. Paragraph 8(iii) of the orders of 1 October 2014 provided:
the Receiver shall advise in the notice referred to in (ii) above that:
(a) nominations of persons seeking to be elected to positions on the Committee should be submitted in writing to the Receiver by a date to be fixed by the Receiver and specified in the said notice, being a date not less than seven days nor more than fourteen days before the date fixed for the AGM; and
(b) the Court has ordered that the AGM or meeting take place even in the absence of a quorum and has indicated that in such event, consideration will be given to the making of appropriate orders.
64 The orders of 1 October 2014 were not accompanied by written reasons but in later reasons, Sifris J noted that the failure to obtain a quorum at the September 2014 meeting had 'clearly frustrated the implementation of the final orders of Robson J'.[96] The orders made by him on 1 October 2014, and in particular the directions about communicating to the shareholders that the meeting would proceed notwithstanding the absence of a quorum, reflected his concern that the resident members ought be given notice that the Court would not permit the orders of Robson J to be rendered nugatory.
The meeting of 10 November 2014 and the return before Sifris J on 1 December 2014
65 Pursuant to the orders of 1 October 2014, the Receivers convened a meeting on 10 November 2014. However, although at least one resident member attended, again the number of resident members present at the meeting did not satisfy the requirements for a quorum under s 23(4) of the Act. The meeting proceeded regardless of the absence of a quorum and seven members were elected.
66 The matter returned to Sifris J on 1 December 2014 pursuant to the liberty to apply that Sifris J had granted on 1 October 2014. On that day the respondents (the plaintiffs below) sought a declaration that the meeting of 10 November 2014 was valid and that there was a valid election of the seven members to the Committee. That application was supported by the OAAV and opposed by Clark-Ugle. As mentioned above,[97] on 16 December 2014 Sifris J declared the meeting held on 10 November 2014 to be valid and the election that took place at that meeting to have been a valid and effective election despite the absence of a quorum. He said:
The plaintiffs submit that the Court has (and in this case should exercise) the power, both express (s 27 of the Act) and inherent or ancillary, to declare the Meeting [the 10 November 2014 meeting] a valid meeting notwithstanding the absence of a quorum and further should declare that those seven persons elected as the Committee of Management at that Meeting should be declared validly elected. I agree and propose to do so.[98]
67 He made orders in the following terms (including an order for staggered terms):
Lionel Harradine for a term of 3 years from November 2014;
Billy McGuiness for a term of 3 years from November 2014;
Ronald Chatfield for a term of 3 years from November 2014;
Brenda Clarke Chatfield for a term of 2 years from November 2014;
Jeremy Clark for a term of 2 years from November 2014;
Geoff Clark for a term of 1 year from November 2014;
Brian Davis for a term of 1 year from November 2014.[99]
68 In his reasons in support of the declarations he made, Sifris J carefully considered the scheme provided for under the Act describing it as a 'fairly skeletal regime of regulation',[100] there being no express power to wind up the affairs of the Trust and no contemplation of, nor provision made for, non-compliance with the provisions of the Act. In this latter respect Sifris J repeated the observation made by Robson J.[101]
69 Sifris J noted that there is no numerical minimum attendance required for a general meeting, and that the Act does not expressly contemplate that the requirement for a quorum may be dispensed with or relaxed.
70 He reiterated that the further failure to satisfy the quorum requirement at the 10 November 2014 meeting, after the failure to make a quorum at the 24 September 2014 meeting, clearly frustrated the proper and effective implementation of the Court's final orders made by Robson J. He said:
The orders of Robson J, made on 20 August 2014, were predicated on the basis that the Court's jurisdiction to make orders under ss 27(1) and (2) of the Act had been enlivened. It is clear enough that the failure to satisfy the quorum requirements of s 23(4) of the Act is frustrating the proper and effective implementation of the Court's final orders. This has already occurred on two separate occasions and there is presently no reason to think it may not occur again.[102]
71 Sifris J observed that Robson J had clearly formed the requisite opinion on which the discretion conferred by s 27 is predicated.[103] He considered that the power in s 27 to deal with and relieve oppression and contraventions of the Act at the suit of Trust members extended to dealing with a misuse of the s 23(4) quorum requirement:
Section 27 was the power expressly relied upon by Robson J to make the declarations and orders of 20 August 2014. Indeed it is the sole repository of express power to deal with and relieve against oppression and non-compliance with the Act at the suit of Trust members. However, the question is whether it extends to non-compliance with the quorum provisions specifically set out in s 23(4) of the Act. In my view it does.
It would be extraordinary if, having exercised the wide discretion in the way Robson J did, the Court's orders could be stultified or rendered nugatory because it lacked the power to dispense, in respect of a meeting which it has ordered, with a quorum based on a minimum number of resident members, not members generally.[104]
72 Sifris J held that the discretionary power conferred by s 27(1) to 'make such orders as the Court thinks fit' is broad and unfettered and that the words which follow are not words of limitation. He considered that as a remedial provision (which it undoubtedly is) s 27(1) should be given a liberal interpretation. He noted that the description of the discretion conferred by s 27(1) is not exhaustive or subject to any limitations, 'other than the Court's own discretion to make orders as it thinks fit'.[105] He noted that there were examples given in s 27(1) as to the type of orders that might be made, for example, orders regulating the affairs of the Trust in the future; or for the purchase of the shares of any members by other members or by the Trust; or otherwise. He also noted that s 27(2) also empowers the Court to make such orders as appear to be necessary to relieve against injustice brought about by an act or omission of the Trust in contravention of the Act.
73 He considered that Robson J clearly regarded the orders he made as 'necessary to give proper relief to the person aggrieved'.[106] Moreover, he considered that the Robson J orders would have provided proper relief had their effect not been frustrated. As he put it:
But for the unforeseen and intentional action of a group of resident members in declining to attend the substituted AGM ordered by the Court, the Plaintiff would indeed have been afforded 'proper relief'.
The remedy agitated for by the plaintiffs is that effectively the quorum requirements for an AGM be dispensed with so that the orders of Robson J may be given effect.[107]
74 He held that, despite the absence of any express power to excuse non-compliance with the quorum requirement, such a power 'is necessary if "proper relief" is to be afforded to the plaintiffs' and the Trust is to continue to operate.[108] He said:
The power (s 27) to give 'proper relief' to the aggrieved person is couched in such broad and unrestricted terms so as to authorise, in my opinion, an order dispensing with the need for a quorum in appropriate circumstances. In this case these circumstances exist. 'Proper relief' in the form suggested is necessary to enable the Trust to continue to operate.[109]
75 He considered that there was no warrant for qualifying the power of the Court under s 27 to the making of only those orders that 'do not contravene any provision of this Act'.[110] He accepted that a powerful reason for reading the power under s 27 as extending to orders dispensing with compliance was that otherwise the Trust could be 'held to ransom by the concerted efforts of a sufficient number of resident members.'[111] It would have been a simple matter for a Parliamentary draftsperson to have qualified the power under s 27 by inserting the words 'subject to this Act'.[112]
76 He acknowledged the reason for the changes to the quorum requirement,[113] including the greater facilitation of the holding of valid meetings, and took that to suggest that the quorum requirement is no more than a 'machinery type' provision:
Clearly enough an AGM or general meeting is an important decision-making forum of the Trust. In order to ensure effective community participation in the decision-making of the Trust there is a quorum requirement. The present form of s 23(4) was introduced by 2004 amendment which changed the quorum from one-half of all Trust members to one-half of the persons entitled to vote at the meeting who are 'residents of the reserve on the date the Meeting was called ...'. The change was introduced because general meetings were not being held due to non-resident members being unable or unwilling to travel from their place of residence to the appointed meeting place as well as to encourage resident participation.
The reason for the change in the quorum requirement may be relevant to the assessment as to whether s 27 confers power to dispense with the quorum requirement. Because the [section] is simply a machinery type provision to enable meetings to proceed with minimum inconvenience and not a provision designed to entrench any rights of resident members it is more easily dispensed with. However, even if this was not the case, I would still dispense with the quorum requirement.[114]
77 Sifris J also observed that in 'the area of Corporations law, where quorum requirements are abused Courts have the power to and have made appropriate orders'.[115]
78 He considered that the circumstances supported the exercise of the discretion to waive compliance with the quorum requirement, most especially, the need to ensure that Court processes are not abused and to enhance the administration of justice. He acknowledged that the power under s 27 was enlivened by the findings of Robson J and that the power to prevent abuse of Court process would extend to the making of orders to ensure that the intended relief directed by Robson J was delivered:
A number of factors suggest it would be appropriate to exercise the discretion to waive compliance with the quorum requirements of s 23(4). In circumstances where the terms of its orders are being frustrated the Court has power to ensure that its processes are not abused and to enhance the administration of justice. This power would extend to revisiting the power to grant relief already enlivened by the findings of Robson J (or indeed exercising a fresh power) to ensure orders are made which will be effectual in delivering the intended relief.[116]
79 He observed that, in the circumstances, it would be hard to sustain the proposition that there was any injustice in validating an inquorate meeting, or that there was an affront to the principle of community participation, where the relevant persons had been formally forewarned by the Court of the possible validity of an inquorate meeting.[117] By dispensing with the quorum requirement, and declaring valid the election of the Committee at the meeting of 10 November 2014, Sifris J brought to an end the external control of the Trust by the Receivers and restored it to a form of governance determined by members of the Trust.
80 The proposed grounds of appeal raised by Clark-Ugle are as follows:
Ground 1 - Sifris J erred in finding that the failure of resident members to attend the general meeting on 10 November 2014 so as to constitute a quorum denied the Plaintiffs proper relief from oppression.
Ground 2 - Sifris J erred in finding that the conduct of the resident members in failing to attend the general meeting so as to constitute a quorum had the effect of frustrating the Court's orders and processes.
Ground 3 - Sifris J erred in concluding that s 27(1) and s 27(2) of the Act were enlivened by the conduct of the resident members of the Trust in not attending so as to constitute a quorum for the general meeting.
Ground 4 - Sifris J erred in the proper construction of s 23(4) of the Act in holding that the section was simply a machinery type provision to enable meetings to proceed with minimum inconvenience and not a provision designed to entrench any rights of resident members.
Ground 5 - Sifris J erred in having regard to the fact that the Court gave the resident members warning of the consequences of non-attendance, which was irrelevant and of no legal effect to any matter before the Court.
Ground 6 - In interpreting s 23(4) and s 27(1) and (2) of the Act, Sifris J erred in:
(a) failing to interpret them, so far as it was possible to do so consistently with their purpose, in a way that was compatible with human rights as required by s 32 of the Charter of Human Rights and Responsibilities 2006 (the Charter);
(b) failing to give consideration to s 19(2) of the Charter and, in particular, sub-section (2)(d) whereby Aboriginal persons must not be denied the right, with other members of their community, to maintain their distinctive spiritual, material and economic relationship with the land and waters and other resources with which they have a connection under traditional laws and customs;
(c) failing to find that s 23(4) of the Act, in requiring that a quorum for a general meeting shall be one-half of the persons entitled to vote at the meeting who are residents of the reserve on the day the meeting was called, was intended to give effect to the special relationship which the Aboriginal residents had with the Framlingham Reserve.[118]
81 It is apparent that the focus of grounds 1-3 share a common complaint that the circumstances with which Sifris J was faced did not enliven the Court's powers under s 27. Ground 4 reflects a more direct challenge to the purpose of the quorum requirement and raises the issue of whether the power of the Court under s 27 to make orders extends to dispensing with the quorum requirement under s 23(4). Ground 5 in substance alleges that Sifris J erred in the exercise of his discretion by taking into account irrelevant considerations. Ground 6 raises a separate issue as to the impact of the Charter of Human Rights and Responsibilities ('the Charter')[119] on the construction of s 23(4) and of s 27(1) and (2) under the Act.
82 It is convenient to consider first the issue of the purpose of the quorum requirement and the related question of the existence of the power to direct that a meeting be held in the absence of a quorum, and to declare such a meeting valid, before considering whether the circumstances with which Sifris J was faced enlivened that power. It will then be necessary to consider whether Sifris J, in purported exercise of the power, took into account irrelevant considerations. The issue of the impact of the Charter can then be addressed.
83 Clark-Ugle submits that the power under s 27 to make orders for relief against oppression, or in response to a contravention of the Act, does not extend to dispensing with the quorum requirement under s 23(4) because of the character and purpose of the quorum requirement. He submits that the quorum requirement affords a vital control to residents to prevent 'outsiders', that is, non-resident members of the Trust, from taking control of the Trust and dictating to members who are residents. He contends that the Act was designed to ensure that the Framlingham land be reserved for the use of residents living on the land. In effect, he submits, the Act intended that the land become the property of the residents. He submits that the quorum requirement is not a mere machinery provision, as Sifris J characterised it, but rather an integral part of a remedial Act that provides a very strong form of control. He contends that the purpose of the quorum requirement is to address the vice of resident members not holding the majority of shares in the Trust and therefore not being able to control a general meeting. He argues that the vice was to be remedied by granting the resident members the right not to attend a general meeting where they could be out-voted by non-resident members.
84 Clark-Ugle submits that an examination of the origins of the Trust, which, as noted above, was constituted under s 8 using the register of all the Aboriginal residents at the time,[121] shows that the rights of the community of residents are paramount and that they are to be free to conduct their own affairs as property owners. He emphasises that no rights of non-resident members are recognised in the Act, nor is the Act
concerned with cultural or artistic aspects of Aborigines or Aboriginal culture that non-residents may have or be concerned with. It is simply concerned with giving property rights to the Aboriginal residents who have a connection with the land which allow them to use the land and thus maintain their connection with their culture and the land.[122]
85 This proposition was developed in oral submissions to suggest that the quorum requirement was 'almost a gatekeeper provision', that required those seeking to convene a meeting to persuade the resident members that the resolutions to be passed would be in the interests of the residents. As it was put by senior counsel for Clark-Ugle on the hearing of the appeal:
In order to get to the meeting you have to get past the quorum. So if you want to get up at a meeting you push proposals out. You have got to satisfy the residents that what you are proposing is in their interest. You have got to win that argument with the residents. You have got to get them on side in order to get the meeting at all, and that is really how it would work in reality.
If the residents said, 'Look, I don't like these proposals you're putting up whatsoever because they're' for whatever reason, and a good reason we will say, they will say, 'Well, it just won't come through the quorum'.
86 Characterised in this way, the quorum requirement, far from being a mere part of the mechanical or operational workings of a meeting, was designed to reinforce the primacy of the community of resident members of the Trust. This was argued to be supported by the statement in the second reading speech, referred to above,[123] that, in changing the quorum requirement from one-half of all Trust members to one-half of all those Trust members who were residents on the day a general meeting was called, the Government was mindful of the 'rights of Aboriginal communities to own and make decisions about the lands they occupy'.[124]
87 The respondents submit that Clark-Ugle's description of the character and purpose of the quorum requirement in s 23(4) of the Act is misconceived. They argue that the quorum requirement was designed to deal with the problems in ensuring sufficient attendance at general meetings caused by the migration of shares in the Trust to non-residents that had occurred over time. They submit that it was designed to facilitate the having of meetings by making it easier to obtain a quorum, that is, instead of requiring fifty per cent of all shareholders to be present, the amendments allowed a quorum where only fifty per cent of resident shareholders were in attendance. A secondary vice to which they submit the amendment was directed was to ensure that no general meeting could be held with a majority of non-resident shareholders in a manner that made it difficult for resident shareholders to attend. However, they argue there is nothing in the wording of the amended subsection or in the preparatory material to suggest that the changes were aimed at elevating resident shareholders to a position of control over the affairs of the Trust by providing them with a right of veto over holding meetings or electing the Committee.
88 The respondents also contest the proposition that there is no recognition of the rights of non-residents in the Act and that the Act renders the rights of residents paramount. They point to various provisions of the Act where rights are conferred without differentiation on resident and non-resident members alike, including, significantly, the right to nominate for and be elected to the Committee. Section 15[125] imposes no requirement of residency upon members of the Committee and, indeed, under s 15(4) it is not necessary for a member of the Committee to be a member of the Trust. They also point to ss 3 and 8, upon which Clark-Ugle relies, as having been enacted in the context of the establishment of the reserve and the Trust and not as imposing an enduring primacy on those who continue to be residents.
89 The respondents also submit, and I agree, that on many occasions where the Act seeks to respect the interests of residents, for example, in the identification of the relevant grounds for the appointment of an administrator (for example, where the appointment is required in the interests of the residents of the reserve),[126] or in the formation of an advisory committee to assist an administrator appointed by the Minister (which must include two persons who were not members of the Committee but who are residents of the reserve), [127] the residents may or may not be members of the Trust. The Act thus does not support the distinction between resident and non-resident members of the Trust upon which Clark-Ugle relies to support his submission that the quorum requirement was intended to confer a strong power to control the affairs of the Trust upon resident members. Shareholders who are residents are not the object of sustained special protection under the Act.
90 The Minister submits that the amendments to s 23(4) of the Act were introduced as a practical measure to facilitate general meetings because requiring 50 per cent of all shareholders to attend was proving problematic due to the fact that many members of the Trust lived off the reserve. She accepts that the amendments were intended to encourage resident shareholder participation, but insists they were not intended to confer control of the management of the Trust upon residents. She argues that the quorum requirement is only a procedural measure and to treat it as introducing a means of elevating the voting rights of resident shareholders over non-residents would impair the functioning of the Trust and the operation of the Act. She contends that it would lead to the Trust 'being held to ransom' by a small minority of resident shareholders, with the risk that the Minister would be forced to intervene by exercising her power to appoint an external administrator.[128] She also contends that there is no support in the second reading speech[129] for the suggestion that the right to constitute a quorum was a vital control for resident members to prevent 'outsiders' taking over the affairs of the Trust. She reiterates the submission of the respondents that the proposition that the quorum requirement was intended to provide to the resident members a mechanism for 'control' of the affairs of the Trust, or to confer the power to impose a 'gateway' to the holding of a meeting, is not consistent with the Act having left the voting rights of non-resident shareholders intact.
91 Furthermore, the Minister submits that even if this Court accepts that s 23(4) is not merely a machinery provision, this does not mean that it is not subject to the wide powers of relief in s 27 of the Act. As both Robson J and Sifris J observed, the Act does not itself identify the specific consequences of non-compliance with the Act.[130] Rather, what the Act does is to confer a broad discretion on the Court to grant relief under s 27 which is available to deal with the many and varied circumstances (including circumstances of non-compliance) that will potentially arise under the Act. In particular, this includes a power to override the quorum requirement in s 23(4) to deal with frustration of orders of the Court.
92 Clark-Ugle responds to the Minister by submitting that there is no basis for the Minister's submission that the amendments to s 23(4) of the Act were introduced in part to deal with attendance problems because many shareholders were living off the reserve. That explanation given in the second reading speech applied to the Lake Tyers reserve.[131] While he accepts that the voting rights of non-resident shareholders have not been directly affected by the amendments to s 23(4), he contends that it is significant that they do not have the opportunity to exercise those rights unless a quorum is formed. He maintains that if the Court accepts the submissions of the respondents and the Minister on s 23(4), the quorum requirement has little or no work to do.
93 In my view, the resolution of this issue is assisted by a consideration of the general concept of a quorum. The concept of a 'quorum' is concerned with ensuring the requisite number of suitably qualified persons are present and exercise their voting rights at a properly convened meeting of an organisation. It is concerned with process and the opportunity to participate, not with the outcome of a meeting or with the manner in which resolutions are to be passed. A 'quorum' is defined in the Butterworths Australian Legal Dictionary as being:
The specified minimum number of members whose presence is necessary to validate the transactions of a meeting of members of a body. The quorum is composed by those actually present at a time and place when all should and might be present as opposed to an ad hoc meeting: Brougham v Melbourne Banking Corp Ltd (1880) 6 VLR (Eq) 214, 222.[132]
94 In Ball v Pearsall[133] Young J in Eq observed that:
The word 'quorum' comes from the time when justices of the peace were assembled in Quarter and Petty Sessions and the justices could only transact business if certain people were there, so many of whom (quorum) were particularly qualified. That flavour filtered down through the law of corporations generally and certainly by the seventeenth century cases such as Hascard v Somany indicated that generally a major number of the whole ought to be present and that unless there was some special provision as to quorum generally speaking the courts would assume that the act of the majority was binding on the corporation. This rule has to a great degree been incorporated as part of the lore of meetings of organisations ever since ... .[134]
95 In Shackleton on the Law and Practice of Meetings[135] the authors make the following observations about the word 'quorum':
The word quorum denotes the number of members of any body of persons whose presence at a meeting is requisite in order that business may be validly transacted. (Conversely, the mere fact that a number of members, sufficient to form a quorum, may meet casually, does not constitute a meeting where the other requisites, such as due notice are absent.)
Quorum is the Latin word for 'of whom' and derives from the wording of commissions by which persons were, from at least the fifteenth century, designated as members of a body by the words 'quorum vos ... unum esse volumus,' ie 'of whom it is our wish that you ... shall be one.'[136]
96 The stipulation as to the number of eligible persons who must be present at a meeting to form a quorum will vary from organisation to organisation. The number
96 will depend on the terms of the relevant legislation or the governing document.[137] It may be that the quorum for a particular body will comprise a majority of those qualified to attend and vote. With some organisations, there will be instances where the quorum needed to validate transactions is a minority, and indeed a very small one at that.[138] By contrast with the quorum requirement under s 23(4) for general meetings of the Trust, the quorum for the Committee has no residency requirement and is less than a majority of the Committee members, being three members only.[139]
97 The role and purpose of a quorum in decision-making reflects the emphasis on the legitimacy of the transactional process rather than on the outcome of decision making. In my view, Clark-Ugle is wrong to submit that the quorum requirement under the Act is intended to be used to ensure that resolutions passed at the general meetings of the Trust favour the resident members.
98 As mentioned,[140] the Act allows for resolutions to be passed pursuant to the wishes of the majority at a general meeting where the non-resident shareholders may out-number the resident shareholders. This allows for the possibility that a quorum of members, even if they all voted in the same way, could be out-voted on any particular resolution. If the interests of residents were paramount, then the Act could have created classes of shares and attached various voting rights to them to ensure that no resolution could be passed without acceptance by a majority of resident members. It did not. It could have required that the Committee has a specified number of residents (either shareholders or not) as members (as is required of the advisory committee established to assist any Administrator).[141] It did not. Instead, as mentioned, the Committee members are made up of 'persons' who do not have to be members of the Trust (s 15(4)). Importantly, if the quorum requirement was devised to reflect or reinforce the intended primacy of the interests of residents, the Act could have introduced a residency restriction to the category of persons to whom shares may be transferred in s 14(2)(d).[142] It did not. In the absence of such a restriction, it is conceivable that as resident shareholders die or become infirm, their shares could be transferred to non-residents, giving rise to an anomalous situation where the number of resident shareholders becomes very small indeed. In such circumstances, the Act must have been intended to confer some broad mechanism to deal with the potential for one or two persons to prevent meetings taking place. Section 27 provides that mechanism.
99 In the context of corporations, it has been held that quorum provisions in articles of association do not vest a right in the minority to enable it to frustrate the wishes of the majority. For example, Wynn-Parry J, in In re El Sombrero Ltd,[143] was faced with circumstances in which no general meeting of a private company had been held. An application was made by a shareholder who held 900 shares (out of a total of 1000 shares) to direct the convening and holding of a meeting. The two respondents to the application each held 50 shares each and were the only directors of the company. The purpose of the meeting was to be to enable the applicant to remove the respondents from their directorships. The respondents opposed the application. Under the company's articles of association, a quorum for general meetings was two persons present in person or by proxy. The application was made on the basis of s 135(1) of the Companies Act 1948 (UK) which empowered the court to order that 'a meeting of the company ... be called, held and conducted in such manner as the court thinks fit', '[i]f for any reason it is impracticable to call a meeting of a company in any manner in which meetings of that company may be called, or to conduct the meeting of the company in [the] manner prescribed by the articles or this Act'. Wynn-Parry J took a broad view of the scope of the power and held that there was nothing to prevent a court exercising it where the application is opposed. He further considered that the circumstances before him justified his exercise of the power on the basis that a refusal of the application would deprive the applicant, as the majority shareholder, of his right to remove the respondents as directors[144] and because the respondents had failed to perform their statutory duty to call an annual general meeting. In rejecting the explanation that the accounts were not yet available, he observed:
It is quite obvious that the only reason why the respondents refuse to call an annual general meeting is because the inevitable result of convening and holding that meeting would be that they would find that they ceased to be directors.[145]
100 He ordered, in terms, 'that one member of the company present in person or by proxy should be deemed to constitute a quorum and that the meeting should be held at the office of the applicant's solicitors'.[146]
101 El Sombrero was relied upon by Brightman J in In re H R Paul & Son Ltd[147] as authority for the proposition that a quorum requirement does not confer a vested right in the minority of a company to enable it to frustrate the wishes of a majority. In In re H R Paul a dissentient minority did not like a proposed takeover and merger and absented itself from meetings convened for the purpose of amending the company's articles. By doing so they frustrated the proper appointment of new directors. Brightman J held that the nearly 90 per cent majority shareholder of the company ought not to be deprived of its right to alter the articles of association of a company by the refusal of a minority to attend company meetings so that the necessary quorum was lacking.
102 Both El Sombrero and In re H R Paul were cited with approval and applied by Morritt J in In re Opera Photographic Ltd[148] where a director who held 51 per cent of the issued shares sought to remove the other director, Mr Martin, who held the remaining 49 per cent. The quorum for meetings of directors or of shareholders was two. The directors had fallen out and the majority shareholder requisitioned the company to convene a meeting, for the purpose of considering a resolution for the removal of the second director, but the latter declined to attend any relevant board meeting for that purpose. It became impossible for the company to convene the meeting. The majority shareholder himself convened a meeting but on that date the other director did not attend. There being no quorum the meeting could not proceed to business. The majority shareholder applied to the court for an order to convene a meeting at which one member should constitute a quorum for the purpose of considering, and if thought fit, passing a resolution for the removal of the second director. It was argued that El Sombrero was of no assistance because the circumstances before the Court were of a quasi-partnership case and it had been recognised by the House of Lords[149] that the legal rights of the parties may be subject to equitable considerations arising out of their agreement. Morritt J rejected the submission and said:
The plain fact of this matter is that deadlock exists between the two individuals which has to be resolved one way or another. It is either capable of being resolved by ordering a meeting, at which no doubt Mr Martin will be removed ... Equally, if no order is made the deadlock will continue because no meetings can be conducted which are going effectively to manage or procure the management of this company, and if that persists for any length of time then no doubt one or other of the individuals will again be presenting a petition based on that deadlock in order to provide some form of resolution.[150]
103 In exercising the discretion to make the order sought he said:
As Brightman J's decision in In re H R Paul & Son Ltd shows, the quorum provisions cannot be regarded as conferring upon the second respondent [Mr Martin] some form of veto as being his entitlement.[151]
104 In Hancock Family Memorial Foundation Ltd v Porteous[152] the Full Court of the Supreme Court of Western Australia (Ipp, Owen and McKechnie JJ) applied Opera Photographic in the context of a dispute amongst members of a wealthy mining family. Mr Hancock held what was described as the 'Life Governor's share' in the company Hancock Prospecting Pty Ltd ('HPPL') which gave him extraordinary powers in respect of it. In effect he had complete control of HPPL and its Board, including the power to declare discriminatory dividends. A question arose as to whether that power could have been frustrated by the refusal of Mrs Rinehart (Mr Hancock's daughter by his first marriage) to attend a general meeting of the company. The Court held that it is not open to a minority shareholder, by failing to attend a meeting, to deny it a quorum and thereby obstruct the determination of the majority to declare discriminatory dividends. The Court said:
[It was] submitted that Mrs Rinehart could have prevented HPPL from resolving to declare discriminatory dividends by refusing to attend any general meeting of the company, thereby preventing the formation of a quorum. There are a number of answers to this proposition. It is sufficient to state that the courts will not allow a minority of shareholders to so obstruct the wishes of the majority: Re Opera Photographic Ltd [1989] 1 WLR 634; Favretto v Eagland (1995) 18 ACSR 196 at 198.[153]
105 Furthermore, as Sifris J observed, the principle that a requirement for a quorum does not create a power of veto is also reflected in the Corporations Act 2001 (Cth). Where applicable, the court has a specific power to resolve a deadlock when a quorum requirement is misused to frustrate the wishes of a majority. For this proposition Sifris J[154] relied upon the statement in Ford's Principles of Corporations Law:
At general law, a meeting cannot make valid decisions unless the prescribed quorum is present. But a quorum requirement does not enable a minority by absenting themselves permanently to frustrate the wishes of the majority. If need be, the court will act under s 249G [of the Corporations Act 2001 (Cth)] to convene a meeting and prescribe a quorum. In Ball v Pearsall Young J speculated that the basis for such a principle was equity's discretion to refuse relief for lack of clean hands, failure to do equity or estoppel. In the United States, the broader view is taken that if a shareholder improperly withdraws from the meeting, the law considers that the meeting may proceed without a quorum.[155]
106 I consider that Sifris J was correct in concluding that, analogously with the power under s 249G of the Corporations Act, the Court has the power under s 27(1) or s 27(2) of the Act to make appropriate orders where quorum requirements are abused by a minority who absent themselves from a meeting to frustrate the wishes of the majority. I do not consider that there is any relevant difference in this respect between a quorum stipulated under a company's articles of association and one prescribed by statute. The authorities well recognise that a quorum requirement cannot be used to prevent an organisation's capacity to conduct business, and to pass resolutions in accordance with the wishes of a majority. The power conferred under s 27 of the Act is cast in terms that are sufficiently broad so as to encompass the relevant power to direct that meetings be held despite the absence of a quorum and to issue declarations of validity both with respect to the meeting and the resolutions that are passed. Indeed, the absence of any specific provision in the Act to deal with non-compliance, or to identify with precision the consequence of a contravention of the Act, emphasised above,[156] reinforces the view that the power conferred by s 27 upon the Court reflects a legislative intention, objectively construed,[157] that, in the face of evidence of oppression or contravening conduct, the Court is to mould the relief it grants to the specific circumstances of the case. Where the vice is an abuse of the quorum requirement, the relief extends to orders dispensing with or varying the requirement, similar to the orders made in El Sombrero[158] and Opera Photographic.[159]
107 Absent the capacity of the Court to grant proper relief in the face of the obvious deadlock, there would be a real risk that the Trust could not continue to function or to administer its own affairs. Even if the Minister appointed an administrator, a general meeting would need to be held at the end of the period of administration and that would be subject to the quorum requirement in s 23(4).[160] The absence of a quorum might continue to frustrate the business and viability of the Trust. This could cause the Trust to act in emergency mode indefinitely.
108 In my view, the quorum requirement under s 23(4) has the limited purpose of encouraging participation by residents in general meetings and facilitating the calling of those meetings. It does not confer a power of veto upon resident members, nor confer upon them a 'gateway' status. It is not a device for controlling the business of the Trust so that only resolutions that favour the interests of residents can be passed. Section 23(4) is not a 'substantive right' provision designed to entrench the rights of resident members. If misused, it can be dispensed with by an order of the Court exercising the power under s 27.[161]
Was the power under s 27 enlivened before Sifris J?[162]
109 Clark-Ugle submits that, even if the power under s 27 extends to declaring a general meeting valid despite the absence of a quorum, the power of the Court under s 27 was not enlivened by the circumstances before Sifris J.
110 His argument rests on a distinction between the circumstances before Robson J and those before Sifris J. He submits that the oppressive conduct which formed the basis of the Robson J orders had been relieved by the declarations Robson J made on 20 August 2014. To recap, the relevantly oppressive conduct consisted in Clark-Ugle and the Trust improperly determining that Aaron and Jeremy Clark were not entitled to nominate for the Committee or attend or vote at the 16 December 2013 general meeting and wrongly determining that only two vacancies on the Committee were open to be filled at that meeting.[163]
111 Clark-Ugle submits that by 1 December 2014 the oppression had ceased and the respondents were restored to the position they would have been in had the oppressive conduct not occurred. In particular, the order declaring that the purported annual general meeting of the Trust on 16 December 2013 was 'conducted in a manner oppressive to one or more members of the Trust (including the plaintiffs)'[164] is relied upon as having provided any necessary relief. Clark-Ugle maintains that Sifris J, when he made his orders on 16 December 2014, was not acting in an ancillary capacity to ensure that the Robson J orders were not frustrated. Rather, he contends, Sifris J was purporting to exercise the power under s 27 independently of the earlier oppressive conduct, or the declaratory relief issued by Robson J. He submits that the decision of resident members not to attend the 10 November 2014 meeting was not a continuation of the earlier oppressive conduct, but rather an exercise of their power, at their choosing, not to satisfy the quorum requirement under s 23(4) of the Act. He claims that there is no suggestion in the Robson J orders that his Honour intended to remove or alter the ordinary rights that residential members of the Trust enjoy in relation to the election of members of the Committee through the processes and conduct of general meetings. When the sequence of court processes is seen in that light, Clark-Ugle submits, the orders made by Sifris J on 16 December 2014 were designed to deal solely with the lack of compliance with his own orders made on 1 October 2014, and not to give effect to the Robson J orders. In other words, Sifris J was intending to correct the absence of a quorum at the 10 November 2014 meeting, and not the absence of a quorum at the 24 September 2014 meeting. Clark-Ugle argues that while the power under s 27 may have been enlivened before Robson J, it was not enlivened before Sifris J either on 1 October 2014 or on 16 December 2014.
112 Furthermore, Clark-Ugle submits that the effect of the orders made by Sifris J on 16 December 2014 was that his Honour treated the respondents differently from all the other Trust members by conferring a right in their favour to dispense with the usual processes and rights of resident members in relation to the conduct of a general meeting. He contends that the 16 December 2014 orders in effect disenfranchised the resident members when they had not engaged in any oppressive conduct after Robson J made his orders, but rather had simply exercised their power not to attend a meeting and not to constitute a quorum.
113 The respondents and the Minister answer, and I agree, that the Robson J orders, without more, did not provide full and effective relief. The essence of the relief was the holding of fresh elections.[165] It was not consistent with the Robson J orders to leave the Trust ungoverned by its members as a result of the inability to hold a meeting and elect a Committee. The holding of fresh elections was intended to produce a newly constituted Committee. Robson J had expressly directed that the Receivers would hold office only until the poll was declared.[166] What was required to restore the respondents to the position which they would have been in had the oppressive conduct not occurred was the completion of a valid election. Only this could redress the oppression arising from the denial to Aaron and Jeremy Clark of the right to nominate, attend and vote at the election of members of the Committee. The Robson J orders sought to ensure that those rights were protected by providing for a valid election at which Aaron and Jeremy Clark could, if they chose, nominate, attend and vote.
114 Furthermore, the holding of fresh elections was necessary to provide relief for the fact that, in so denying Aaron and Jeremy Clark, the Trust contravened the Act.[167] For the previous irregularities to be remedied it was necessary for a Committee to be validly elected. In other words, for effective relief to be afforded to the respondents it was necessary not only for Robson J to make orders declaring invalid the meeting of 16 December 2013 but also for an annual general meeting to take place and a fresh election to be held for all seven positions on the Committee. That did not occur because of the absence of a quorum. The Robson J orders, and their intended effect, would remain frustrated until a meeting and an election validly took place.
115 It was with this object in mind that Sifris J made the orders he did on 1 October 2014 for the holding of an annual general meeting and dispensing with a quorum if necessary. This is apparent from the observation made by Sifris J that the failure to obtain a quorum at the 24 September 2014 meeting convened by the Receivers had 'clearly frustrated the implementation of the final orders of Robson J'.[168] Having referred to the frustration of the Robson J orders, he said:
Accordingly the matter came on for further hearing before me on 1 October 2014. Concerned that the orders of the Court may be rendered nugatory, I fashioned orders the effect of which was to require the Receivers to again convene an AGM.[169]
116 When the matter returned to Sifris J on 1 December 2014, it was clear to his Honour that the Robson J orders would remain frustrated if the absence of a quorum at the annual general meeting that took place on 10 November 2014 invalidated that meeting and invalidated the election of members of the Committee. He said:
The orders of Robson J, made on 20 August 2014, were predicated on the basis that the Court's jurisdiction to make orders under ss 27(1) and (2) of the Act had been enlivened. It is clear enough that the failure to satisfy the quorum requirements of s 23(4) of the Act is frustrating the proper and effective implementation of the Court's final orders. This has already occurred on two separate occasions and there is presently no reason to think it may not occur again.[170]
It would be extraordinary if, having exercised the wide discretion in the way Robson J did, the Court's orders could be stultified or rendered nugatory because it lacked the power to dispense, in respect of a meeting which it has ordered, with a quorum based a minimum number of resident members, not members generally.[171]
118 He acceded to grant the remedy sought by the plaintiffs, namely,
that effectively the quorum requirements for an AGM be dispensed with so that the orders of Robson J may be given effect.[172]
119 In my view, both the orders of 1 October 2014 and those of 16 December 2014, made by Sifris J, were ancillary or supplemental orders to the Robson J orders in that they sought to ensure that the Robson J orders took effect as they were intended; they sought to aid in the enforcement and working out of those orders.
120 The character of orders as ancillary or supplemental to primary orders was recognised in Remington Products Australia Pty Ltd v Energizer Australia Pty Ltd.[173] There Moore J made final orders permanently restraining Energizer Australia from distributing or making certain representations about batteries. Some months later he made further orders requiring Energizer Australia to remove certain batteries from public display or to place stickers over certain representations on those batteries. He found that Remington Products had endeavoured to create 'an unjustified measure of comfort'[174] for retailers if they persisted in displaying and selling batteries in the misleading packaging. Remington Products appealed on the basis that Moore J did not have the power to make the further orders. In dismissing the appeal, the Full Federal Court (Tamberlin, Jacobson and Edmonds JJ) held that Moore J had the power to make the further orders, those orders being 'supplemental orders because they were related to the [earlier] orders and were incidental to or in aid of the enforcement and working out of those orders'.[175] The Court referred to the High Court's decision in Pelechowski v Registrar, Court of Appeal (NSW)[176] where the Court referred to orders which may be 'reasonably required or legally ancillary to the accomplishment of ... specific remedies for enforcement'.[177]
121 The orders made by Sifris J were clearly reasonably required by, or legally ancillary to, the accomplishment of the specific relief ordered by Robson J. Robson J had determined, on the basis of the history of the Trust, that it was necessary for all seven positions on the Committee to be declared vacant until a further poll could be held. He ordered an election to be conducted by the Receivers so that all seven positions on the Committee could be filled and directed that an annual general meeting be convened not more than 60 days after 20 August 2014. It is clear that those orders could not accomplish what was necessary for their efficacy unless an annual general meeting was actually held. Seven out of the eight then resident members decided not to attend. In those circumstances, the relief to which the Robson J orders was directed, namely, the election of a new Committee, would fail unless ancillary or supplemental orders were made to accomplish that relief. This is precisely the purpose and character of the orders made by Sifris J on both 1 October and 16 December 2014.
122 The character of the orders of Sifris J of 1 October 2014 as supplemental to the Robson J orders is reinforced by their having been obtained, as was accepted by all parties, by means of the liberty to apply extended by Robson J.[178] They provided an intermediate step in the enforcement of the Robson J orders. So too the orders of 16 December 2014 were obtained by reason of the liberty to apply granted by Sifris J on 1 October 2014,[179] as part of a single staged process.
123 While the orders of 16 December 2014 made reference to the meeting convened as a result of the orders of 1 October 2014, this was not a de novo exercise engaged in as a result of events that had occurred after the Robson J orders were made. It is inappropriate to distinguish between the meeting convened by the Receivers on 24 September 2014 (pursuant to the Robson J orders) and the meeting convened on 10 November 2014 (pursuant to the Sifris J orders of 1 October 2014) as though there was no relationship between them. Both meetings were called (and both orders were made) to put the conduct of the affairs of the Trust on a legal and proper footing. The orders of 1 October 2014 extended an additional opportunity to the resident members, beyond that provided by Robson J, to co-operate in securing that legal and proper footing for the Trust. The orders of 1 October, and the orders of 16 December 2014, related to the Robson J orders and their enforcement.[180] Unless Sifris J made the orders he did on 16 December 2014 the Robson J orders would have become nugatory and their intended effect thwarted.
124 In my view, the orders made on 1 October 2014 and on 16 December 2014 by Sifris J were made in the exercise of the power to make ancillary or supplemental orders which gave effect to, and aided the enforcement and working out of, the Robson J orders. Because the orders of Sifris J were supplemental to the Robson J orders, it was not necessary for Sifris J to make new findings of oppression or contravention. The power under s 27 continued to remain enlivened. Sifris J was entitled to base his orders of 16 December 2014 upon all the findings made by Robson J with respect to both the oppression and the contraventions of the Act. He was entitled to 'revisit' the power under s 27(1) and (2) that Robson J had exercised for the purpose of making supplemental orders to ensure that the Robson J orders were not rendered futile by the conduct of resident members in attempting to prevent a valid election of a new Committee.[181]
125 Had the orders of 1 October and 16 December 2014 been made by Robson J, in addition to his earlier orders, it would have been untenable for Clark-Ugle to argue that either of those orders had not been made in the exercise of s 27 on the basis of all the findings of oppression and contraventions his Honour had found. It makes no difference that those orders were made by a different judge. It is important to recognise that the Robson J orders and those made by Sifris J are not to be viewed simply as orders made by individual judges. The orders made by each of the judges are orders of the Court. They take their force and effect as orders of the Court. This is reinforced by the many references in the reasons of Sifris J to 'the Court's orders'.[182] When the intended effect of an order of the Court is frustrated by external circumstances, it may be necessary for supplemental orders to be made to ensure that the intended effect of the original order is ultimately achieved. It is not material whether the orders are made by the same judge or by different judges of the same Court. The orders ultimately derive their force and effect from the power vested in the Court.
126 The recognition that the orders made by Sifris J are supplemental orders to those made by Robson J also meets an additional argument made by Clark-Ugle relating to the interpretation of s 27(1) of the Act. He claims that as s 27(1) is concerned with 'the affairs of the Trust' being conducted in a manner oppressive to one or more members, and as it is the Committee (and not individual members) that conducts 'the affairs of the Trust', the sub-section is directed at oppressive conduct of the Committee and not at an individual member's behaviour. In particular, decisions by resident members of the Trust not to attend a meeting, for whatever reason, so as to avoid a quorum being established, could not be characterised as conduct in 'the affairs of the Trust'. Similarly, it is argued, s 27(2) is directed to contraventions of the Act 'by the Trust' and the failure to constitute a quorum does not amount to a contravention of the Act 'by the Trust'. Thus, it is contended, neither sub-s (1) nor sub-s (2) of s 27 provides a vehicle for members to bring complaints against other members of the Trust in their capacity as individual members for failure to attend a meeting.
127 It may be doubted whether the 'affairs of the Trust' in s 27(1) has the narrow meaning for which Clark-Ugle contended. This need not be resolved because, on the view I adopt, the orders made by Sifris J sought to accomplish the relief to which the Robson J orders were directed. Thus the requirements of s 27(1) and of s 27(2) were satisfied by the findings made by Robson J in respect of the history of non-compliance with the Act and the circumstances of oppression he identified, and not simply in respect of non-attendance by individual resident members at a meeting. It is not necessary to decide whether the power in s 27 could be enlivened by non-attendance at a meeting, without more.
128 Clark-Ugle further argues that if the conduct of resident members in not attending the November 2014 meeting was to be challenged, the proceeding should have been brought by an aggrieved person against individual resident members of the Trust, and not just against the Trust and Clark-Ugle. He claims that a new proceeding would now need to be brought because the Court should have been assisted with evidence and full arguments on the issue. He also complains that the resident members were not represented as a group before Sifris J and there was no evidence before the judge about the reasons for their non-attendance at the 10 November 2014 meeting.
129 The Minister submits that this is the first time the issue of the proper parties has been raised notwithstanding that it was clear from 1 October 2014 that Sifris J was contemplating using s 27 to dispense with the quorum requirement and no challenge was raised to the Court's power to do so on this basis.
130 The failure to raise this issue before Sifris J creates significant difficulty for Clark-Ugle. Both Clark-Ugle and the resident members were aware that the meeting of 10 November 2014 might proceed without a quorum, by reason of the notice which Sifris J directed the Receivers to issue, and of the proceeding before his Honour more generally.[183] It cannot now be said that the manner in which the proceeding was constituted has occasioned any injustice to the resident members.
131 Moreover, while the non-attendance of resident members at the 10 November 2014 meeting prompted Sifris J to declare that meeting valid despite the absence of a quorum, his Honour was directing his orders at ensuring there could be proper governance of the Trust, not at reprimanding individual resident members who did not attend.
132 Importantly, it has never been submitted by Clark-Ugle, before Sifris J or on appeal, that there was an innocent explanation for the non-attendance by resident members either at the annual general meeting convened by the Receivers on 24 September 2014 or at the annual general meeting convened on 10 November 2014 pursuant to the orders of Sifris J. On the contrary, what is submitted is that the quorum requirement provides a right of veto to resident members with respect to the business of the Trust and that whether a meeting is held depends upon the resident members being persuaded, in advance, of the merits of the resolutions to be proposed at a meeting. Resident members, so the submission goes, have a right to choose to attend or not to attend depending upon how they elect to perform their 'gateway' function. I have rejected this submission as inconsistent with the purpose of a quorum and with the general principle at law that a requirement for a quorum does not create a power of veto that can be used to frustrate the wishes of a majority. It is apparent that this submission is far removed from, and arguably inconsistent with, the argument that there was a need for specific explanations to be sought from each eligible resident who failed to attend the relevant meetings.
133 The circumstances here appear to echo those adverted to in Opera Photographic.[184] The plain fact is that there was a deadlock between the resident members and non-resident members of the Trust which required resolution and the orders of Sifris J sought to do that. The circumstances are also reminiscent of those in El Sombrero[185] in that, given the history of disputation between resident members and non-resident members of the Trust, it is quite obvious that the only material reason the resident members refused to attend the meeting of 24 September 2014, or the meeting of 10 November 2014, is because the inevitable result of holding that meeting would be a risk that the resident members would not occupy positions on the Committee.
134 I consider that Sifris J was correct to find that the conduct of the resident members in failing to attend the annual general meeting on 10 November 2014 denied the respondents proper relief from oppression and non-compliance with the Act and frustrated the Court's orders and processes. The power under s 27 continued to be enlivened before him.[186]
Did the discretion miscarry?[187]
135 In the orders of 1 October 2014 Sifris J directed that the notice by the Receivers was to include the warning that the meeting would take place 'even in the absence of a quorum'.[188] Clark-Ugle complains that the Act did not provide his Honour with jurisdiction either to make that warning, or subsequently to rely upon it not being heeded. He submits that the warning, and the fact that it was not heeded, was an irrelevant consideration. By taking that irrelevant consideration into account, it is argued that the discretionary power exercised by Sifris J miscarried.
136 I reject the submission that the warning was irrelevant. It amounted to giving the resident members notice that they could not rely on their non-attendance, or the failure of a quorum to be achieved, to prevent a valid meeting taking place. In other words, the resident members were put on notice that the validity of what was to be resolved at the meeting (which might adversely affect their interests) would not depend on a quorum having been achieved. There was nothing inappropriate or irrelevant about the judge taking this step. Indeed, the resident members may well have complained if no notice had been given.
137 Moreover, it was relevant for Sifris J to have regard to the fact that resident members decided not to attend the 10 November 2014 meeting despite having been warned that the meeting's validity would not depend on the quorum requirement being satisfied. This provided a proper basis for Sifris J to infer that the conduct of the resident members in not attending the meeting was the result of a deliberate decision.
138 In any event, a discretion will only miscarry by reason of taking irrelevant considerations into account where a decision-maker is prohibited from taking those considerations into account.[189] In my view, it is not tenable to submit that a judge is prohibited from taking into account a warning notice he or she has given to a person whose interests may be adversely affected, or prohibited from taking into account that the warning was not heeded.
139 I consider that the discretion exercised by Sifris J did not miscarry.[190]
Were Charter rights affected?[191]
140 The final ground of appeal concerns the interpretive obligation under the Charter. Clark-Ugle submits that Sifris J failed to interpret the Act in accordance with the obligation under s 32(1) of the Charter, namely:
So far as it is possible to do so consistently with their purpose, all statutory provisions must be interpreted in a way that is compatible with human rights.
141 He submits that s 32(1) required the judge to explore all possible interpretations of the Act and adopt that which least infringed Charter rights.[192] The right which Clark-Ugle identifies as relevant is the 'cultural right' under s 19(2)(d) of the Charter. This provides:
(2) Aboriginal persons hold distinct cultural rights and must not be denied the right, with other members of their community -
...
(d) to maintain their distinctive spiritual, material and economic relationship with the land and waters and other resources with which they have a connection under traditional laws and customs.
142 Clark-Ugle submits that the failure by Sifris J to consider s 19(2)(d) of the Charter, and to interpret the Act, especially the quorum requirement under s 23(4), in a way that is compatible with the cultural right, meant that his Honour did not consider whether the quorum requirement entrenches the rights of resident members so as to give effect to the special relationship of resident members to the land reserved for use by Aboriginal persons at Framlingham, the reserve. This stands in contrast to the relationship between non-resident members and that land.
143 Exactly how the interpretive obligation is to be performed has been the subject
143 of much judicial and extra-judicial opinion.[193] What is clear, however, is that the interpretive obligation will not be enlivened unless a relevant human right is engaged. The difficulty faced by Clark-Ugle is that the right he has identified, the cultural right under s 19(2)(d) of the Charter, does not distinguish between residents and non-residents. Section 19(2)(d) does not, and does not purport to, distinguish between Aboriginal persons who live on the land with which they have a connection under traditional laws and customs and other Aboriginal persons who do not live on the land with which they have a connection under traditional laws and customs, but whom maintain a distinctive spiritual, material and economic relationship with that land nevertheless.
144 In other words, the enjoyment of the cultural right is not dependent upon residency. The characteristic of residency does not serve to differentiate between Aboriginal persons who have a distinctive spiritual, material and economic connection to the reserve and those who do not. The fact that some members of the Trust choose not to live on the reserve does not mean that they do not, and cannot, bear the distinctive spiritual, material and economic relationship to the reserve that is founded on their traditional connection to it.
145 As s 19(2)(d) does not differentiate between residents and non-residents, it follows that it does not support the further distinction Clark-Ugle seeks to draw, that between resident members and non-resident members of the Trust.
146 The right under s 19(2)(d) is a right of Aboriginal persons held 'with other members of their community'. Clark-Ugle submits that the 'community' should be interpreted here to mean 'the Framlingham Reserve community and any non-aboriginal persons living within that community'. However, this begs the question at issue. The 'Framlingham Reserve community' must extend at least to all members of the Trust given that the Trust was established precisely so that the land reserved for the Aboriginal community at Framlingham could be vested in the Trust.[194] This would mean that the Framlingham reserve community includes, at least, both resident members and non-resident members of the Trust. This reinforces an interpretation of the cultural right, in the circumstances, as extending beyond residents alone.
147 Membership of the Trust is derived from being an Aboriginal person resident on the reserve on 8 December 1970 and either having been resident on the reserve on 1 January 1968[195] or by having been born before 8 December 1970 to a woman who was resident on the reserve on 1 January 1968.[196] Alternatively, membership is derived from having received shares from a family member who may not be a resident of the reserve (including the husband or wife, or a child or remoter issue of the member, or brother, sister or parent of the member, or a brother or sister of a parent of the member, or a child or remoter issue of a parent of the member, or of a brother or sister of a parent of the member).[197] As mentioned above, not all residents are members of the Trust and not all members of the Trust are residents. Nor does the Act adopt residency as an important qualifying criterion.[198] The alternative paths to membership of the Trust, which may not include residency, reinforces the view that the cultural right under s 19(2)(d), and its enjoyment by Aboriginal persons and 'members of their community', does not treat residency as an important qualifying criterion.
148 It follows that the right under s 19(2)(d) is not engaged in the manner for which Clark-Ugle contends.
149 I reject the proposition that Charter rights were affected in these proceedings.
150 In my view, it could not be said that the appeal had no more than a fanciful prospect of success.[199] I would grant the application for leave to appeal. However, I would dismiss the appeal.
151 I have had the advantage of reading the reasons of Tate JA in draft. I agree with her Honour for the reasons that she gives that leave to appeal should be granted and that the appeal should be dismissed.
152 I agree, for the reasons given by Tate JA, that leave to appeal should be granted but that the appeal should be dismissed.
[1] Clark v Framlingham Aboriginal Trust [2014] VSC 642 ('Sifris J Reasons').
[2] The 'reserve' is defined under the Act as the Framlingham reserve or the Lake Tyers reserve. The Lake Tyers reserve is not material to the appeal.
[5] Orders of Robson J on 20 August 2014 ('the Robson J orders') and orders of Sifris J on 1 October 2014.
[6] Paragraph 8(iii)(b) of the orders of Sifris J on 1 October 2014: '[T]he Receiver[s] shall advise in the notice [of the meeting] that: ... the Court has ordered that the AGM or meeting take place even in the absence of a quorum and has indicated that in such event, consideration will be given to the making of appropriate orders.'
[7] See Clark v Framlingham Aboriginal Trust [2014] VSC 367 ('Robson J Reasons'). See [58] below. There has been no appeal from the Robson J orders. The Receivers appointed were Geoffrey Ridgeway and Glenn Anthony Crisp.
[9] The respondents were the plaintiffs below.
[11] The Trust was the first defendant in the proceedings below. Clark-Ugle was the second defendant.
[12] Pursuant to orders made by Mandie and Beach JJA on 24 April 2015.
[21] There was an exception with respect to the first annual general meeting which did not need to be held until the Trust had been in existence for a full financial year: s 22(8).
[24] Aboriginal Lands (Amendment) Act 2004, s 6.
[25] Explanatory Memorandum, Aboriginal Lands (Amendment) Bill 2004 (Vic) 1.
[26] Victoria, Parliamentary Debates, Legislative Assembly, 26 August 2004, 198 (John Thwaites, Minister for Environment) (emphasis added).
[28] Robson J Reasons [184] (23-24 June 2014).
[29] Sifris J Reasons [17] (1 December 2014).
[45] Clark-Ugle adopted the name 'Possum' (so that he is called Geoffrey (Possum) Clark-Ugle) to distinguish himself from Geoff Clark: see Robson J Reasons [5].
[47] In an affidavit dated 13 February 2014.
[48] Robson J Reasons [7] and [152]. The third plaintiff in the proceedings before Robson J, besides Aaron Clark and Jeremy Clark, was Tim Chatfield who is the registered holder of 500 shares in the Trust.
[49] Robson J Reasons [41] and [101].
[51] Clause 6. Robson J noted that it was unclear how Aaron or Jeremy Clark came to execute the deed of settlement even though they were not parties to either proceeding and the connection between Geoff, Jeremy and Aaron Clark and the Harradine/Kirrae proceedings was unknown. The trustee in bankruptcy agreed to the inclusion of the clause: Robson J Reasons [33]-[36].
[68] This was not the senior counsel who appeared on behalf of Clark-Ugle on the appeal.
[69] Ronald Chatfield resigned the following day, as did Brenda Chatfield.
[71] There was no evidence before Robson J of the timing of the first annual general meeting but it may not have been until December 1972 as the Trust was not obliged to hold its first annual general meeting until it had been in existence for a full financial year: Robson J Reasons [114].
[78] For example, Re Bright Pine Mills Pty Ltd [1969] VicRp 121; [1969] VR 1002; Re Tivoli Freeholds Ltd [1972] VicRp 51; [1972] VR 445.
[83] Ibid [189]-[190] (emphasis added).
[84] Ibid [191]. It appears that Robson J took the view that the power under s 27 was sufficiently broad to direct that staggered elections be held as an order that the Court thought fit 'to regulate the affairs of the Trust in future' although this was not a matter which members of the Committee had the power to agree upon. As mentioned, there has been no appeal from the orders of Robson J.
[92] Sifris J Reasons [4]. With respect to the meeting convened by the Receivers pursuant to the Robson J orders, Sifris J noted that there had been an article in the newspaper, the Warrnambool Standard, 25 September 2014, that quoted Clark-Ugle as saying that a majority of the resident shareholders decided not to attend that annual general meeting which was ordered by Robson J to deny that meeting a quorum. There was no contradiction of that statement before his Honour: Sifris J Reasons n 3, referring to Peter Collins, 'Divided they fall' Warrnambool Standard (Melbourne Victoria) 25 September 2014, Exhibit SD-4 to the affidavit of Shayne Daley, solicitor for the plaintiffs (the respondents), sworn 1 October 2014. In the Summary prepared for the Court of Appeal the statement is made that at the 24 September 2014 meeting the meeting did not proceed because 'there was no quorum of resident shareholders present (other than Geoff Clark)'.
[93] See Blakey v Latham (1889) 43 Ch D 23, 25-6 on the nature of interlocutory directions that may accompany final orders.
[94] Orders made by Sifris J on 1 October 2014, [8(ix)].
[95] In the Orders of 1 October 2014 Sifris J referred to the Receivers in the singular but he noted, in [1], that the appointment of both Geoffrey Ridgeway and Glenn Anthony Crisp was to continue.
[107] Ibid [26]-[27] (emphasis added).
[114] Sifris J Reasons [32] and [34].
[118] In his written case in response to the submissions filed by the Minister, ClarkUgle also indicated that if necessary he would apply to amend his application to add a further ground: 'Ground 4A - If s 23(4) was a "substantive right" provision designed to entrench any rights of resident members, Sifris J erred in holding at [34] that he would still be entitled under s 27 to dispense with the quorum requirement.' However, leave was never sought to amend the grounds of appeal to include ground 4A. As I do not consider that s 23(4) confers a substantive right on residents, ground 4A is not properly raised.
[119] Section 1(1) of the Charter of Human Rights and Responsibilities provides: 'This Act may be referred to as the Charter of Human Rights and Responsibilities and is so referred to in this Act'. The convention is to refer to an Act by its short title (as expressed in the Charter by s 1(1)) and there is thus no need to refer to the Charter as the 'Charter of Human Rights and Responsibilities Act': see Interpretation of Legislation Act 1984, s 10(1)(e); Deming No 456 Pty Ltd v Brisbane Unit Development Corporation Pty Ltd [1983] HCA 44; (1983) 155 CLR 129, 162 (Wilson J).
[122] Written Case for the applicant dated 3 February 2015, [17].
[132] Peter E Nygh and Peter Butt (eds), Butterworths Australian Legal Dictionary (Butterworths, 1997).
[135] Madeleine Cordes and John Pugh-Smith (eds), Shackleton on the Law and Practice of Meetings (Sweet & Maxwell, 13th ed, 2014).
[137] For example, a quorum at a meeting of a council or a special committee must be at least a majority of the members of the council or the special committee: s 91(3A) of the Local Government Act 1989. Where a quorum of a council cannot be formed or maintained due to the absence of councillors, the Minister or the Chief Executive Officer may follow the procedure of requiring all councillors to attend a call of the council meeting under s 85, and in certain circumstances (for example, where the Minister is not satisfied that the councillor had a reasonable excuse for not attending) the Minister may order that a councillor is incapable of continuing to be a councillor.
[138] For example, under s 64N(2) of the Bankruptcy Act 1966 (Cth) a quorum of a meeting of creditors is constituted where the trustee or his or her representative is present in person together with a creditor, or a proxy or attorney of a creditor, participating in person or by telephone.
[143] [1958] 1 Ch 900 ('El Sombrero').
[144] Pursuant to s 184(1) of the Companies Act 1948 (UK).
[145] El Sombrero [1958] 1 Ch 900, 907.
[147] (1973) 118 Sol J 166 ('In re H R Paul').
[148] [1989] 1 WLR 634 ('Opera Photographic').
[149] In re Westbourne Galleries Ltd [1973] AC 360.
[150] Opera Photographic [1989] 1 WLR 634, 636-7.
[151] Ibid 637 (citation omitted). See also Union Music Ltd v Watson [2004] BCC 37 [42], [56] (English Court of Appeal).
[154] Sifris J Reasons [35] and n 10.
[155] H A J Ford, R P Austin and I M Ramsay, LexisNexis, Ford's Principles of Corporations Law, vol 1 (at service 107) [7.500] (citations omitted). Section 249G of the Corporations Act 2001 (Cth) provides:
249G Calling of meetings of members by the Court
(1) The Court may order a meeting of the company's members to be called if it is impracticable to call the meeting in any other way.
(2) The Court may make the order on application by:
(b) any member who would be entitled to vote at the meeting.
[157] See, eg, Lacey v Attorney-General (Qld) [2011] HCA 10; (2011) 242 CLR 573.
[161] It follows that I reject ground 4 of the grounds of appeal. There is no need to consider whether the orders made by Sifris J are supported by the Court's inherent power although I would incline to the view that they are so supported.
[173] [2008] FCAFC 47; (2008) 246 ALR 113 ('Remington').
[176] (1999) 198 CLR 435 ('Pelechowski').
[177] Ibid 452 [51] (Gaudron, Gummow and Callinan JJ). This was in the context of determining the scope of orders that could be made by the District Court of New South Wales.
[180] The relationship between the orders can also be seen in the direction by Sifris J that an election be held for all seven positions as members of the Committee which depended upon the earlier declaration in the Robson J orders that all seven positions on the Committee be declared vacant: Robson J orders [2]. See [58] above.
[181] See [78] above. His Honour's comment that, in the alternative, he could exercise a fresh discretion should not distract from the power he did exercise in aiding the enforcement of the Robson J orders, as described above. In any event, it is unnecessary to resolve whether the non-attendance at the meetings, in the circumstances, could also have enlivened the discretion.
[186] It follows that I reject grounds 1, 2 and 3 of the grounds of appeal.
[189] House v The King [1936] HCA 40; (1936) 55 CLR 499, 504-5; Minister for Aboriginal Affairs v Peko-Wallsend Ltd [1986] HCA 40; (1986) 162 CLR 24, 39-40.
[190] It follows that I reject ground 5.
[192] Victorian Police Toll Enforcement v Taha [2013] VSCA 37 [24]-[25]. See also [195].
[193] For example, Hogan v Hinch [2011] HCA 4; (2011) 243 CLR 506; Momcilovic v The Queen (2011) 245 CLR 1; Victorian Police Toll Enforcement v Taha [2013] VSCA 37; Carolan v The Queen [2015] VSCA 167; Bare v IBAC (2015) 326 ALR 198; 'Human Rights under the Charter: The Development of Human Rights Law in Victoria' (2014) 2 JCVOJ
[199] Kennedy v Shire of Campaspe [2015] VSCA 47 [12].
Clark-Ugle
Clark [2016] VSCA 44
(1983) 155 CLR 129
(1987) 10 NSWLR 700
(2000) 156 FLR 249
(2008) 246 ALR 113
(1936) 55 CLR 499
(2011) 243 CLR 506
(2015) 326 ALR 198
(2011) 242 CLR 573
(1999) 198 CLR 435
(1986) 162 CLR 24
(2011) 245 CLR 1