Diener v Registered Association trading as Rooty Hill and District Racing Pigeon Club Inc

Supreme Court of NSW|2022-05-19|Before: Robb J, Williams J

dez (Fifth Plaintiff) George Hajidavid (Sixth Plaintiff) Kevin Gambell (Seventh Plaintiff) Louie Gottardo (Eighth Plaintiff) Michael Attard (Ninth Plaintiff) Warren Schofield (Tenth Plaintiff) Manuel Gatt (Eleventh Plaintiff) Stephen Bond (Twelfth Plaintiff) Nicholas Robinson (Thirteenth Plaintiff) Paul Zammit (Fourteenth Plaintiff) Peter Andrews (Fifteenth Plaintiff) Robert Roach (Sixteenth Plaintiff) Sam El-Helou (Seventeenth Plaintiff) Registered Association trading as Rooty Hill and District Racing Pigeon Club Inc (First Defendant) Phillip Hill (Second Defendant) Frank Zimmer (Third Defendant) Jason Harris (Fourth Defendant) Representation: Counsel: M Baroni / J Widjaja (Plaintiffs) A Maroya (Defendants)

JUDGMENT

These proceedings were commenced by 17 plaintiffs by filing a statement of claim on 12 December 2018. I will identify the individual plaintiffs when I come to deal with their claims.
The first defendant is the Rooty Hill and District Racing Pigeon Club Inc (the Club). The Club was incorporated on 25 February 1991 under the Associations Incorporation Act 1984 (NSW) (the 1984 Act). As its name suggests, the Club is a social club whose members participate in the sport of pigeon racing.
The second to fourth defendants are respectively Phillip Hill, Frank Zimmer and Jason Harris, who are officers of the Club as members of its committee. They are respectively the president, the treasurer and the secretary.

The plaintiffs' claims

By their statement of claim, the plaintiffs sought the following relief: 1. An order that the first defendant (the Association) perform and observe its rules by producing documents to the first plaintiff identified in paragraph 29 of the pleadings. 2. A declaration that the plaintiffs are members of the first defendant. 3. A declaration that the election of the Committee of Management of the Association purported to have been elected at the 2017 Annual General Meeting was not validly appointed pursuant to the Model Rules. 4. An order that the defendants pay the plaintiffs' costs of the proceedings.
The plaintiffs alleged that, at all material times, the Club has been an association within the meaning of the Associations Incorporation Act 2009 (NSW) (the 2009 Act), which legislation repealed and replaced the 1984 Act.
The plaintiffs alleged that, at all material times, they have each been members of the Club and that the second to fourth defendants were its committee members. They alleged that the constitution of the Club was in writing as set out in a document called "Model Rules for the Incorporation of Associations" (the Rules), and that the Rules bound the parties as if they were a contract between them, by reason of s 26 of the 2009 Act.
The plaintiffs then alleged that the Rules contained the express terms listed in par 6, including, in particular, as alleged in par 6(a): "A person ceases to be a member of the association if the person - (a) dies; (b) resigns that membership; or (c) is expelled from the Association (clause 4)…"
In pars 7 to 23, the plaintiffs alleged that each plaintiff became a member of the Club (mostly giving the alleged year of joining) and that each plaintiff has not resigned from membership or been expelled.
In pars 24 to 28, the plaintiffs alleged that, in February 2017, the Club held an annual general meeting at which it purported to elect the second to fourth defendants as its committee. The plaintiffs alleged that the election was invalid because they had not been given notice of the annual general meeting.
In pars 29 to 31, the plaintiffs alleged that the first plaintiff sought certain documents from the Club by his solicitors' letters dated 10 July 2017 and 16 October 2017, but that the Club has excluded him from access to the documents.
By their defence, the defendants did not admit that the plaintiffs had become members of the Club. As will be seen, in most cases, the defendants accepted that the plaintiffs had at one time been members of the Club, but they argued that those plaintiffs who had been members had ceased to be members. The defendants did not plead specific defences to the plaintiffs' claims, although they did plead in par 16 that the plaintiffs should be denied relief by reason of laches and delay.
The plaintiffs filed an amended statement of claim on 7 August 2023, which was the last day of the hearing. Although the plaintiffs' written closing submissions referred to this pleading, I have noted that the Court's file contains what appears to be an identical amended statement of claim filed in court on 1 December 2022.
The claim for relief in the amended statement of claim deleted the claim in par 3 of the statement of claim for a declaration that the second to fourth defendants had not been validly elected as officers of the Club. It added prayers 3A and 3B, to the effect that the secretary of the Club should be ordered to create and maintain a register of members, and that each of the plaintiffs be declared to be a member and be added to the register of members, provided that each plaintiff paid any annual membership fees in arrears within 28 days of judgment.
Prayer 3C sought a declaration that the constitution of the Club registered with Fair Trading NSW in October 2017 is invalid.
The amended statement of claim deleted the claims of the second, thirteenth and sixteenth plaintiffs. The Court was informed by the plaintiffs' written closing submissions that the ninth plaintiff was deceased and his claim would not be pursued.
The plaintiffs pleaded in pars 29A to 29D of the amended statement of claim that the constitution registered by the Club in October 2017 with NSW Fair Trading (the October 2017 Constitution) was invalid because rule 30 of the Rules, being the previous constitution, required that amendments to it must be passed by special resolution at a general meeting of which no less than 21 days written notice of the intention to propose the special resolution had been given, and none of the plaintiffs were given notice of the proposed new constitution.
It has taken an inordinate amount of time for these proceedings to be determined. They were set down for hearing on the parties' estimate of the length of the hearing for three days in the period 17 to 19 May 2022, but the hearing was not completed in that time. The same process occurred over the four days between 28 November and 1 December 2022. It was necessary for the Court to set aside 7 August 2023 for the parties to complete the hearing. The plaintiffs delivered written closing submissions on 25 August 2023, the defendants responded on 29 September 2023, and the plaintiffs delivered written submissions in reply on 13 October 2023.

Background

The evidence suggests that the Club existed in an unincorporated form from at least 1963. On 25 February 1991, the Club was incorporated pursuant to the 1984 Act.
Relevantly, s 15 of the 1984 Act had the following effect as at the date of incorporation of the Club: 15 Effect of incorporation (1) On and from the date specified as the date of incorporation in a certificate of incorporation of an association granted under this Act (other than under section 14 (5)), but subject to this Act and the rules of the incorporated association: (a) in the case of a certificate granted under section 10, the persons who were the members of the association immediately before that date or, where the certificate is granted in respect of a proposed association as referred to in section 8 (2), the persons who under that subsection authorised incorporation of the proposed association, … together with any other persons who from time to time become members of the incorporated association (as from the time they become members), are an incorporated association by the name set out in the certificate, subject to any change of name effected by the issue of a new certificate of incorporation under section 14 (5).
Consequently, the persons who were members of the Club when it was an unincorporated association became members of the incorporated Club when its certificate of incorporation was granted. This has the effect that the issue of whether individual plaintiffs became members will depend upon whether or not they were members at the date of the incorporation of the Club. If they were, they became members by force of s 15(1)(a) of the 1984 Act. If they purported to join as members afterwards, there will be a question of the significance of the formalities in the Rules concerning the acquisition of membership not having been complied with.
The evidence established that the seventh plaintiff, Keith Gambell, probably became a member of the unincorporated association in 1977, but he stopped participating in that association's affairs in about 1985. Consequently, it did not appear that he was still a member of the association under the informal membership rules that it applied at the date of incorporation of the Club. Consequently, it appeared that he did not become a member by force of s 15(1)(a) of the 1984 Act. Accordingly, the plaintiffs conceded at par 86 of their written closing submissions that the Court would find that Mr Gambell was not a member of the Club.
The Club adopted the "Model Rules" under the 1984 Act. On 7 April 2009, the 2009 Act came into effect. The 2009 Act repealed the 1984 Act, but the effect of clause 3 of Part 2 of Schedule 4 of the 2009 Act was that the Club was taken to have been registered under the 2009 Act, and to have continued as the same legal entity as the former association. The effect of clause 4 of the same transitional provisions was that the rules that governed the Club in its earlier form were taken to be its constitution under the 2009 Act.
On 13 October 2017, the Club submitted the October 2017 Constitution to NSW Fair Trading for registration. It is not disputed that none of the plaintiffs were given notice of the meeting at which the October 2017 Constitution was approved by a special resolution of the members of the Club then voting. The plaintiffs were not given notice of the general meeting because the committee of the Club did not believe that they were current members.
The parties conducted the case on the basis that the terms of the October 2017 Constitution are not relevant to the question of whether any of the plaintiffs are members of the Club. If the October 2017 Constitution is valid, then the rules contained in it concerning membership will be operative. I assume that the parties satisfied themselves that the rules concerning membership were materially the same as the equivalent rules in the Rules. If that is so, it is not necessary for the Court to decide what is the operative constitution of the Club before it determine the plaintiffs' membership claims.
As noted, the Club is a pigeon racing club. The intricacies of what is involved in pigeon racing are not relevant to the determination of these proceedings.
Mr Hill has been the president of the Club since its inception. Mr Zimmer has been the treasurer for about 15 years. Mr Harris has been the secretary of the Club since 2017. Mr Harris' evidence was that there are currently somewhere between 8 and 11 members of the Club, aside from the plaintiffs' claims to be members.
So far as the evidence goes, the Club has always operated informally according to its own rules as understood by the members. At least in relation to the issue of membership, it has not conformed with the formal requirements of the Rules. The evidence was that Mr Zimmer and Mr Harris had never read the Rules. It is likely that the Club has simply continued to operate in accordance with the informal rules that the members for the time being understood were in force during the period when the Club was an unincorporated association. The fact of incorporation under the 1984 Act, and the formal adoption of the "Model Rules" under that Act, do not appear to have impinged significantly on the way the Club has operated; at least in respect of the issue of membership.
It is probable that no member of the Club has ever been accepted formally in compliance with the relevant rule in the Rules. I will set out that rule below. The evidence on the subject of membership was a little unclear, but it appears that at each annual general meeting a list of persons attending, who evidently wished to be considered as members of the Club was made, and the relevant membership fees were collected. It may be that persons who were known to wish to continue to be members would be added to the list, if for some practical reason they could not attend the annual general meeting. In order to race pigeons for the Club, a person had to be a financial member. However, a person could be a member and not race pigeons. A member would be considered to be financial provided they paid their membership fees before the first pigeon race of the season. There were complicated rules established by agreement governing the pigeon racing affairs of the Club and its members.
The Club has been an affiliate of the Central Cumberland Racing Pigeon Federation Inc (the Federation), which required the Club's members to pay a "race fee" to the Federation if they wanted to race in the Federation's races.
It has been a long-standing rule of the Club that members can only participate in pigeon races with the Club if they resided within the Club's residential zone, which was specifically delineated on a map that was displayed in the Club's clubhouse. This was not a rule included in the Rules. The reason for the rule was not explored in detail, but I understand that it was adopted because racing members' pigeons would be released from the same place a considerable distance from the pigeons' lofts at the residences of members, and, so that the pigeons' flying distances would be relatively fair and equal, it was necessary to ensure that all of the members' pigeon lofts were relatively closely located.
In about 2016, the Club sold its clubhouse at 360 Rooty Hill Road North, Plumpton.
The plaintiffs say that the catalyst for the current proceedings was the introduction of what was called the "100% rule," and the refusal of the committee to permit new members to join after the Club had sold its premises and until a new clubhouse was set up, unless the applicant for membership applied at a meeting of members and was approved by all members present. The evidence did not make the origins of this supposed rule clear, but it is suggested that it had something to do with the limitations in the facilities available to assist members to engage in pigeon racing after the clubhouse had been sold. To the extent that this "rule" existed, it was informal and not included in the Rules. Whatever may be the underlying truth of the matter, it does appear that the application of the 100% rule caused contention amongst members or would-be members, and this is apparently what has led to these proceedings.
The issue of membership, according to the plaintiffs, came to a head on 24 February 2017 at a meeting of members of the Club, during which a vote was taken on an application by Mr Gatt to "join" the Club. Mr Gatt is the eleventh plaintiff, and claims in these proceedings to be a valid member of the Club, even though he made an application for membership at the meeting, and his application was rejected, because it was not supported by 100% of the members who were in attendance.

The Rules

I will now set out those parts of the Rules that have some relevance to the determination of the present dispute, as that is necessary in order to understand some of the issues.
As already noted, the Rules are the Model Rules For The Incorporation of Associations in Schedule 1 of the regulations made under the 1984 Act.
Relevantly, the following rules in Part II of the Rules deal with the issue of membership of the Club: NOMINATION FOR MEMBERSHIP 3(1) Nomination of a person for membership of the association - (a) shall be made by a member of the Association in writing in the form set out in Appendix 1 to these rules; and (b) shall be lodged with the secretary of the Association. (2) As soon as practicable after receiving a nomination for membership, the secretary shall refer the nomination to the committee, which shall determine whether to approve or to reject the nomination. (3) Where the committee determines to approve a nomination for membership, the secretary shall, as soon as practicable after that determination, notify the nominee of that approval and request the nominee to pay within the period of 28 days after receipt by the nominee of the notification the sum payable under these rules by a member as entrance fee and annual subscription. (4) The secretary shall, on payment by the nominee of the amounts referred to in clause (3) within the period referred to in that clause, enter the nominee's name in the register of members and, upon the name being so entered, the nominee becomes a member of the Association. CESSATION OF MEMBERSHIP 4. A person ceases to be a member of the association if the person - (a) dies; (b) resigns that membership; or (c) is expelled from the Association. … RESIGNATION OF MEMBERSHIP 6.(1) A member of the association is not entitled to resign that membership except in accordance with this rule. (2) A member of the association who has paid all amounts payable by the member to the Association in respect of the member's membership may resign from membership of the association by first giving notice (being not less than 1 month or not less than such other period as the committee may determine) in writing to the secretary of the member's intention to resign and, upon the expiration of the period of notice, the member ceases to be a member. (3) Where a member of the association ceases to be a member pursuant to clause (2), and in every other case where a member ceases to hold membership, the secretary shall make an appropriate entry in the register of members recording the date on which the member ceased to be a member. REGISTER OF MEMBERS 7.(1) The public officer of the association shall establish and maintain a register of members of the association specifying the name and address of each person who is a member of the association, together with the date on which the person became a member. (2) The register of members shall be kept at the principal place of administration of the association and shall be open for inspection, free of charge, by any member of the association at any reasonable hour. FEES, SUBSCRIPTIONS, ETC 8.(1) A member of the association shall, on admission to membership, pay to the association a fee of $1, or, where some other amount is determined by the committee, of that other amount. (2) In addition to any amount payable by the member under clause (1), a member of the association shall pay to the association an annual membership fee of $2 or, where some other amount is determined by the committee, of that other amount - (a) except as provided by paragraph (b), before 1st July in each calendar year; or (b) where the member becomes a member on or after 1st July in any calendar year - upon becoming a member and before 1st July in each succeeding calendar year. MEMBERS' LIABILITIES 9. The liability of a member of the association to contribute towards the payment of the debts and liabilities of the association or the costs, charges and expenses of the winding up of the association is limited to the amount, if any, unpaid by the member in respect of membership of the association as required by rule 8. DISCIPLINING OF MEMBERS 10.(1) Where the committee is of the opinion that a member of the association - (a) has persistently refused or neglected to comply with a provision or provisions of these rules; or (b) has persistently and wilfully acted in a manner prejudicial to the interests of the association, the committee may, by resolution - (c) expel the member from the association; or (d) suspend the member from membership of the association for a specified period. …
The calling of general meetings of the Club is dealt with in the Rules in the following terms: PART IV GENERAL MEETINGS ANNUAL GENERAL MEETING - HOLDING OF 22.(1) With the exception of the first annual general meeting of the association, the association shall, at least once in each calendar year and within the period of 6 months after the expiration of each financial year of the association, convene an annual general meeting of its members. … ANNUAL GENERAL MEETINGS - CALLING OF AND BUSINESS AT 23.(1) … (2) In addition to any other business which may be transacted at an annual general meeting, the business of an annual general meeting shall be… SPECIAL GENERAL MEETINGS - CALLING OF 24.(1) The committee may, whenever it thinks fit, convene a special general meeting of the Association. … NOTICE 25.… (2) Where the nature of the business proposed to be dealt with at a general meeting requires a special resolution of the association, the secretary shall, at least 21 days before the date fixed for the holding of the general meeting, cause notice to be sent to each member in the manner provided in clause (1) specifying, in addition to the matter required under clause (1), the intention to propose the resolution as a special resolution. … SPECIAL RESOLUTION 30. A resolution of the association is a special resolution if - (a) it is passed by a majority, which comprises not less than three-quarters of such members of the association as being entitled under these rules so to do, vote in person or by proxy at a general meeting of which not less than 21 days' written notice specifying the intention to propose the resolution as a special resolution was given in accordance with these rules; or …
Alterations to the Rules must be made in accordance with rule 36, which provides as follows: ALTERATION OF OBJECTS AND RULES 36. The statement of objects and these rules may be altered, rescinded or added to only by a special resolution of the association.…

Non-compliance with the Rules

The Club has apparently never complied with the Rules in relation to the admission of new members or their resignation. There is no register of members and no such register has ever been kept. As I understand it, it is not suggested by the plaintiffs that they became members of the Club in a manner that formally complied with rule 3. Equally, as I understand it, the defendants do not say that any of the plaintiffs formally ceased to be members in accordance with rules 4(b) and 6. As there was no register of members, the names of the plaintiffs were not entered into such a register when they were accepted as members, and accordingly their names have never been removed from the register.
In fact, the members of the Club for the time being have, by a relatively informal process, treated persons as having joined as members, or having resigned, as a result of what happened at each annual general meeting, and whether persons who wished to be members were accepted by the other members present - possibly informally, by consensus, before the introduction of the so-called 100% rule - and whether those persons paid their membership fees in accordance with the accepted practice.
As will be seen, the uniform divergence of the Club's practices from the requirements of the Rules gives rise to a problem in these proceedings. In particular, the plaintiffs, who did not become members in accordance with the Rules claim that they remain members because they have not resigned in accordance with the requirements of the Rules. The defendants, on the other hand, have contended that, by some informal process, the Rules must be applied subject to the informal rules that the members have in fact, by consensus, applied over the life of the Club. Consequently, as will be seen, the defendants have admitted that most of the plaintiffs were at one time members of the Club, but that is not because the formal requirements of rule 3 of the Rules were complied with; but rather, the plaintiffs had in the past been accepted as members because of the relatively informal process described above that took place at annual general meetings. Having admitted that most of the plaintiffs were members of the Club at some time in the past on this basis, the defendants have submitted that the plaintiffs all ceased to be members, not because they complied with the formal requirements of rule 6 of the Rules, but because they had at some time in the past ceased to be members in accordance with the Club's informal practices - principally, that they had not paid their membership fees for many years, or participated significantly in the Club's affairs, so that they had resigned or abandoned their memberships.
This approach by the parties gives rise to a logical problem in the determination by the Court of the principal issue in these proceedings. The plaintiffs say that they should be treated as members even though they did not join in compliance with the Rules, but they should not be treated as having resigned because they did not resign in accordance with the Rules. The defendants have admitted that most of the plaintiffs were members in the past, but that is only on the implicit basis that persons could become members in accordance with the informal practices adopted by the Club, but the defendants then submit that consistency requires that the plaintiffs have resigned or abandoned their memberships also on the basis of those informal practices.

Outline of parties' cases

Given that there are 13 separate active plaintiffs and the differences between the issues in the different plaintiffs' cases, relating as they did to different events at different times over a significant number of years, the Court required the parties to provide summaries of their claims. The plaintiffs did so on 18 October 2022 (plaintiffs' summary). The defendants provided their summary in reply on 24 November 2022 (defendants' summary).
Although the approach may be somewhat belaboured, the most efficient way to deal with the individual cases of the plaintiffs and the responses of the defendants is to set out, plaintiff by plaintiff, both the plaintiffs' and the defendants' summary in relation to that plaintiff. This will involve an element of repetition, as many of the plaintiffs' cases are structurally similar, and the defendants responses follow suit. I have to an extent abbreviated and paraphrased the parties' summaries.

Rudy Diener (first plaintiff)

Plaintiffs' summary - Rudy Diener contends that:

he became a member of the Club;
he did not resign from the Club in accordance with its constitution or at all;
he attended the 2017 Annual General Meeting and paid $25 each in membership fees for himself and his wife Barbara Diener; and
he continues to be a member of the Club.

Defendants' summary - Mr Diener:

had been, until his resignation in 2017, a member of the Club;
resigned from the Club in 2017, and that resignation from the Club may be effected not only in accordance with the procedures stipulated in the Rules, but may be unilateral;
the purported payment of membership fees for Ms Diener was of no effect, as Ms Diener was not a member of the Club; and
is not, by reason of his resignation in 2017, a member of the Club.

Barbara Diener (third plaintiff)

Plaintiffs' summary - Barbara Diener contends that:

she joined the Club in or about 2013, after Mr Diener had told her that the Club did not have enough members to continue operating;
Mr Diener was responsible for paying her membership, and she believes that he did so;
she was unable to attend Friday night Club meetings as it conflicted with other commitments;
she flew pigeons with Mr Diener as a team;
she did not resign from the Club in accordance with its constitution or at all; and
she continues to be a member of the Club.

Defendants' summary - Ms Diener:

has never been a member of the Club, and has never submitted an application for membership;
Mr Diener's purported payment of membership fees on Ms Diener's behalf was of no effect, as she was not a member of the Club;
her inability to attend Friday night Club meetings was immaterial, by reason of her not being a member of the Club;
her flying pigeons with Mr Diener as a team is irrelevant to the question of her membership of the Club;
she could not have resigned from the Club, as she is not a member thereof; and
she is not a member of the Club.

Danny Williams (fourth plaintiff)

Plaintiffs' summary - Danny Williams contends that:

he joined the Club in 1993 or 1994;
he attempted to renew his membership in 2003;
he gave Harry Eggers his membership money but his payment but was refused on the direction of Philip Hill;
he wanted to maintain his membership with the Club but was not given notice of any of the Club's annual general meetings in order to pay his membership fees;
he did not resign from the Club in accordance with its constitution or at all; and
he continues to be a member of the Club.

Defendants' summary - Mr Williams:

he became a member of the Club in about 1992 or 1993;
he failed to pay membership subscriptions after 2009;
tendering membership fees to Mr Eggers was of no effect, as Mr Williams had ceased to be a member of the Club by reason of his failure to pay membership fees;
he is not entitled, by reason of his cessation as a member of the Club, to be notified of annual general meetings;
he ceased to be a member of the Club by reason of his failure to pay membership fees, and the question of resignation, as formulated by the plaintiffs' summary, is irrelevant to the question of his membership status; and
he is not a member of the Club.

Fernando Hernandez (fifth plaintiff)

Plaintiffs' summary - Mr Hernandez contends that:

he joined the Club in 2003;
he stopped participating in the Club's races due to concerns about the management of the Club, including money which was missing from the bank account of the Club;
he did not tell anyone at the Club that he was resigning;
he understood at the time that, according to the Club's rules, he remained a member of the Club;
he was told by Harry Eggers in 2011 that he would be unable to race with the Club again due to the 100% rule;
he did not resign from the Club in accordance with its constitution or at all; and
he continues to be a member of the Club.

Defendants' summary - Mr Hernandez:

he joined the Club in 2003;
he did not pay membership fees after 2006;
not telling anyone at the Club that he was resigning is irrelevant to the question of his membership status;
his understanding of the Club rules is irrelevant, and that Mr Hernandez ceased to be a member by reason of his failure to pay membership fees;
his ability to race with the Club in 2011 was dependent on his being a member, which in 2011 Hernandez was not;
he ceased to be a member of the Club by reason of his failure to pay membership fees, and the question of resignation, as formulated in the plaintiffs' summary, is irrelevant to the question of his membership status; and
he is not a member of the Club, and is ineligible to be a member of the Club by reason of his living without the geographical boundaries set by the Club.

George Hajidavid (sixth plaintiff)

Plaintiffs' summary - Mr Hajidavid contends that:

he joined the Club in 2000;
he has not received notices of the Club's annual general meetings since about 2008;
he did not resign from the Club in accordance with its constitution or at all; and
he continues to be a member of the Club.

Defendants' summary - Mr Hajidavid:

he joined the Club in 2000;
he did not pay membership fees after 2008;
he ceased to be a member of the Club by reason of his failure to pay membership fees, and was not entitled, by reason of his cessation as a member of the Club, to be notified of annual general meetings;
he ceased to be a member of the Club by reason of his failure to pay membership fees, and the question of his resignation, as formulated in the plaintiffs' summary, is irrelevant to the question of his membership status; and
he is not a member of the Club, and is ineligible to be a member of the Club by reason of his living without the geographical boundaries set by the Club.

Louie Gottardo (eighth plaintiff)

Plaintiffs' summary - Mr Gottardo contends:

he joined the Club in 1983;
he stopped racing with the Club in about 1993;
he did not resign from the Club in accordance with its constitution or at all; and
he continues to be a member of the Club.

Defendants' summary - Mr Gottardo:

he joined the Club in 1983;
he failed to pay membership fees after 1993;
he ceased to be a member of the Club by reason of his failure to pay membership fees;
in an open communication made in 2017 to the Federation, he stated that he had "approached Rooty Hill Pigeon Club to join as a member";
had therefore admitted that he was not, as at 2017, a member of the Club;
he ceased to be a member of the Club by reason of his failure to pay membership fees, and the question of resignation, as formulated in the plaintiffs' summary, is irrelevant to the question of his membership status; and
he is not a member of the Club.

Warren Schofield (tenth plaintiff)

Plaintiffs' summary - Mr Schofield contends that:

he joined the Club in about 1980;
he ceased attending the Club in about 2010 due to issues with management of the Club;
he did not resign from the Club in accordance with its constitution or at all; and
he continues to be a member of the Club.

Defendants' summary - Mr Schofield:

he joined the Club in 1980;
he ceased attending the Club in 2007, failed to pay membership fees after 2007 and ceased to be a member of the Club by reason of his failure to pay membership fees;
he ceased to be a member of the Club by reason of his failure to pay membership fees, and the question of his resignation, as formulated in the plaintiffs' summary, is irrelevant to the question of his membership status; and
he is not a member of the Club.

Manuel Gatt (eleventh plaintiff)

Plaintiffs' summary - Mr Gatt contends that:

he joined the Club in about 1980;
he stopped racing pigeons in about 1994;
he continued to attend race meetings every second Saturday;
he continued to meet with Mr Hill between 1996 and 2017 and expressed his intention to remain involved with the Club;
he purchased racing rings from Mr Hill in 2016 or 2017;
he did not resign from the Club in accordance with its constitution or at all; and
he continues to be a member of the Club.

Defendants' summary - Mr Gatt:

he joined the Club in 1980;
he failed to pay membership fees after 1994, and ceased to be a member of the Club by reason of his failure to pay membership fees;
any attendance of Mr Gatt at race meetings was on a purely voluntary basis, and not in the character of a member of the Club;
the alleged expressions of intention are irrelevant to the question of his membership status;
the purchase of racing rings in 2016 or 2017 is irrelevant to the question of his membership status;
he ceased to be a member of the Club by reason of his failure to pay membership fees, and the question of resignation, as formulated in the plaintiffs' summary, is irrelevant to the question of his membership status;
he stated in a letter dated 6 March 2017 to the Federation that he wished to join and become a member of the Club;
he applied in 2017 for membership of the Club;
he was not admitted to membership; and
he is not a member of the Club.

Stephen Bond (twelfth plaintiff)

Plaintiffs' summary - Mr Bond contends that:

he joined the Club in about 1963;
he stopped racing with the Club in about 2010 as he had moved away from the area;
he had always intended to remain a member of the Club;
he did not resign from the Club in accordance with its constitution or at all; and
he continues to be a member of the Club.

Defendants' summary - Mr Bond:

he joined the Club in 1963;
he last attended an annual general meeting of the club in 1999;
he failed to pay membership fees after that date;
he raced with the Riverstone club from 2010;
he ceased to be a member of the Club by reason of his failure to pay membership fees, and the question of his resignation as formulated in the plaintiffs' summary, is irrelevant to the question of his membership status;
he is not a member of the Club, and is ineligible to be a member of the Club by reason of his living without the geographical boundaries set by the Club.

Paul Zammit (fourteenth plaintiff)

Plaintiffs' summary - Mr Zammit contends that:

he was a member of the Club since at least the early 2000s;
he did not race with the Club in 2009, due to ill health and the subsequent death of his father;
he was approached by Philip Hill in the factory of Rudy Diener and told that he would never race with the Club again;
as a result of being told that, he did not return to the Club to race;
he had always intended to remain a member of the Club and continue to race pigeons;
he did not resign from the Club in accordance with its constitution or at all; and
he continues to be a member of the Club.

Defendants' summary - Mr Zammit:

(without admitting that he was a member of the Club) he purportedly joined in the early 2000s;
he last attended the Club in 2007;
he failed to pay membership fees after 2007;
he was suspended from the Club that year;
what Mr Zammit was allegedly told by Mr Hill in Mr Diener's factory is irrelevant to the question of his membership status;
his intention to remain a member of the Club and continue to race pigeons is irrelevant to the question of his membership status;
he ceased to be a member of the Club by reason of his failure to pay membership fees, and the question of resignation, as formulated in the plaintiffs' summary, is irrelevant to the question of his membership status; and
he is not a member of the Club, and is ineligible to be a member of the Club by reason of his living without the geographical boundaries set by the Club.

Peter Andrews (fifteenth plaintiff)

Plaintiffs' summary - Mr Andrews contends that:

he joined the Club in 1993;
he stopped racing in about 2009;
he continued to pay the annual membership fees of the Club, even though he did not attend meetings or race pigeons;
he suffered from a brain aneurysm in about 2014 and did not race for a few years;
he, in 2016, after further surgeries and a period of recovery, told Mr Hill he wanted to start racing again and was told that he needed approval at an annual general meeting;
he attended the annual general meeting and was told that the Club was not accepting new members;
he did not resign from the Club in accordance with its constitution or at all; and
he continues to be a member of the Club.

Defendants' summary - Mr Andrews:

he joined the Club in 1993;
he last attended the Club in 2009;
he failed to pay membership fees after 2009;
he did not race pigeons for several years from 2014, but he ceased to be a member of the Club by that time, by reason of his failure to pay membership fees;
he did not submit an application for membership;
he attended the 2016 annual general meeting, expressed an interest in joining the Club, but did not submit an application for membership, and therefore was not admitted to membership;
he ceased to be a member of the Club by reason of his failure to pay membership fees, and the question of resignation, as formulated in the plaintiffs' summary, is irrelevant to the question of his membership status; and
he is not a member of the Club.

Sam El-Helou (seventeenth plaintiff)

Plaintiffs' summary - Mr El-Helou contends that:

he joined the Club in 2008;
he stopped racing and attending meetings in 2012 due to personal issues;
he continued to pay his membership fee;
he did not resign from the Club in accordance with its constitution or at all; and
he continues to be a member of the Club.

Defendants' summary - Mr El-Helou:

he joined the Club in 2008;
he last attended the Club in 2012;
he failed to pay membership fees after that date;
he ceased to be a member of the Club by reason of his failure to pay membership fees, and the question of his resignation, as formulated in the plaintiffs' summary, is irrelevant to the question of his membership status;
he ceased to be a member of the Club by reason of his failure to pay membership fees;
in an open communication made on 5 March 2017 to the Federation, he stated that he had in 2016 "asked [Mr Hill] about joining the Club again";
therefore, he had admitted that he was not, as of 2016, a member of the club; and
he is not a member of the Club.

Issues raised by the parties' cases

An analysis of the summary of the parties' cases set out above in relation to the individual plaintiffs' claims demonstrates that the following issues arise:

The defendants admit that the plaintiffs Gottardo, Schofield, Gatt and Bond became members of the Club before it was incorporated on 25 February 1991. Consequently, the admission of membership is unqualified, as it was governed by the rules adopted by the members before the Rules came into effect. In each case, the defendants allege that the events that caused the plaintiff to cease to be a member occurred after the date of incorporation, so there is an issue as to whether the plaintiffs' retirement could be effective if it was not in accordance with the Rules.
The defendants admit that the plaintiffs Williams, Hernandez, Hajidavid, Andrews and El-Helou became members of the Club after it was incorporated. For those members, the issue of whether they retired raises the question of whether they can say that they became members without complying with the Rules, but then say their retirement could not be effective unless made in compliance with the Rules.
The parties' summaries did not deal with the date when Mr Diener became a member. There was no challenge to his evidence in par 3 of his 11 October 2019 affidavit that he became a member in 1964. The validity of his membership and alleged retirement must therefore be dealt with on the same basis as the other plaintiffs who became members before the Club was incorporated.
The defendants did not admit that the plaintiff Zammit became a member, although they noted that Mr Zammit claimed to have become a member after the date when the Club was incorporated.
There is a contest as to whether Ms Diener became a member at all. As she claims to have become a member in 2013, the Rules were in effect at that time.
There is an issue in relation to whether a number of plaintiffs' memberships were affected by conduct on their part which may constitute an admission that they were not members. The defendants say that the plaintiffs Gottardo, Gatt and El-Helou made admissions that they were not members, and that the plaintiffs Gatt and Andrews either made an unsuccessful application for membership or stated at a meeting of the Club that they intended to apply for membership.
There is an issue in relation to the plaintiffs Hernandez, Hajidavid and Bond as to whether there is a rule of the Club that has the effect that members are disqualified if they do not reside in the Club's membership catchment area.
There is a reference in the defendants' summary in relation to Mr Zammit that his membership was suspended in 2007.

As will be seen from the parties' summaries, there were some discrepancies in their claims as to when a plaintiff ceased to pay membership fees, and some of the plaintiffs made assertions of limited involvement in the activities of the Club after the time when the defendants say they ceased to pay membership fees. A few plaintiffs also gave brief reasons as to why they ceased to participate in the Club's activities. The evidence on these issues was relatively limited, and they were generally not the subject of detailed contest at the hearing. It will not be necessary for the Court to make precise findings on most of these issues. As appears from the defendants' summary, they usually took the stance of not directly challenging the plaintiffs' claims, but by saying that the limited matters raised by the plaintiffs were irrelevant to the issue of their continuing membership, because the plaintiffs had ceased to pay their membership fees a long time before the events alleged by the plaintiffs occurred.
I accept the assertions made by the defendants as to the approximate times when the plaintiffs ceased paying membership fees. There was no real challenge to the defendants' position on this issue at the hearing. As I understand it, the cessation of the payment of membership fees was associated with the relevant plaintiffs ceasing to have any significant participation in the affairs of the Club.

Resignation of plaintiffs as members of the Club

The most significant issue in these proceedings is whether the plaintiffs other than Ms Diener effectively resigned as members of the Club before the commencement of the proceedings. As to Ms Diener, the defendants mount a positive case that she never became a member of the Club.
In no case did any plaintiff comply with the formal requirements in rule 6 of the Rules that purport to govern the manner in which members may validly resign from the Club.
The question therefore is whether, notwithstanding the terms of rule 6, as a matter of law, members could effectively resign or abandon their membership notwithstanding non-compliance with that term of the Rules. If that question is to be answered in the affirmative, the next question will be whether the particular conduct of each plaintiff constituted an effective resignation or abandonment of their memberships.
Those will be the only questions in the case of those plaintiffs who were definitely members of the Club because they were accepted as being members at the date it was incorporated. For those plaintiffs, it will be immaterial how they became members.
In the case of the plaintiffs who claim to have become members of the Club after the date it was incorporated, it will be necessary to consider the issue raised above; being whether they can claim to be members notwithstanding that they did not comply with rule 3 of the Rules that governed the acquisition of membership, and at the same time, say that their resignation will not be effective if the circumstances did not comply with rule 6
In the case of all plaintiffs other than Mr and Ms Diener, the conduct that the defendants alleged had the effect that the plaintiffs resigned or abandoned their membership of the Club was the non-payment of membership fees for many years, associated in various degrees with ceasing to participate in the affairs of the Club, including non-attendance at its annual general meetings.
The case involving Mr Diener must be considered separately, as the defendants claim that Mr Diener made statements to members of the committee that should be construed as stating an intention to resign his membership.
I will consider the issue of the validity of the defendants' claim that the plaintiffs resigned or abandoned their memberships by non-payment of membership fees and non-participation in the affairs of the Club, before I consider separately the cases of Mr and Ms Diener.

Legal principles governing retirement as a member

The starting position is to note the effect of s 26 of the 2009 Act that governs the nature of the legal relationship between an association that is incorporated under the Act and its members. The section provides: 26 Nature of association (1) Subject to this Act, an association's constitution binds the association and its members to the same extent as if it were a contract between them under which they each agree to observe its provisions. (2) Subject to this Act, a member of an association (including a committee member and the public officer) is not, merely because of being such a member, liable in relation to - (a) any of the association's liabilities, or (b) the costs, charges and expenses of the winding up of the association. (3) Subject to this Act, membership of an association does not confer on a member any right, title or interest, whether legal or equitable, in the association's assets.
Thus, the Court is required to determine the plaintiffs' claims on the basis that they must, first, demonstrate that they are members of the Club, so that they have standing to enforce the contract created by s 26 of the 2009 Act, and then second, they must establish the grounds for the available legal and equitable remedies in respect of any breaches committed by the Club.
For convenience, I will repeat the relevant parts of rule 6, as follows: RESIGNATION OF MEMBERSHIP 6. (1) A member of the association is not entitled to resign that membership except in accordance with this rule. (2) A member of the association who has paid all amounts payable by the member to the Association in respect of the member's membership may resign from membership of the association by first giving notice (being not less than 1 month or not less than such other period as the committee may determine) in writing to the secretary of the member's intention to resign and, upon the expiration of the period of notice, the member ceases to be a member. (3) Where a member of the association ceases to be a member pursuant to clause (2), and in every other case where a member ceases to hold membership, the secretary shall make an appropriate entry in the register of members recording the date on which the member ceased to be a member.
It is to be noted that rule 6(1) states in positive terms that a member is not entitled to resign their membership except in accordance with the rule. However, the use of the expression "not entitled" may be significant. The rule does not state that a purported resignation will be ineffective if the requirements of the rule are not satisfied. The expression "not entitled", directed as it is at the member who wishes to resign, suggests that the real purpose of rule 6(1) is to deny to members a right of resignation that they would otherwise have, unless they comply with the requirements set out in the rule.
Not only did none of the plaintiffs resign their membership in accordance with this rule, but none of them expressly resigned at all, putting aside the dispute about whether Mr Diener did so. The question is whether the other plaintiffs' conduct had the effect that they ceased to be members of the Club. Consequently, the issue is whether by their conduct the other plaintiffs impliedly resigned, or whether the real effect of their conduct was that they abandoned their memberships.
The position at common law as to whether a member is entitled unilaterally to withdraw from membership of an association is as stated by Lindley LJ in Finch v Oake [1896] 1 Ch 409 at 415 as follows: What then is the position of a member who has paid his subscription of 10s. 6d. for the current year? Can he withdraw from the association at any moment at his own pleasure, or can he withdraw only with the consent of his fellow members? In my opinion, when he has paid his subscription for the year he is under no obligation whatever to his fellow members. By paying his subscription he no doubt acquires certain rights and benefits. But what is there to prevent him from retiring from the association at any moment if he wishes to do so? Absolutely nothing. In my opinion no acceptance of his resignation is required, though of course he cannot get back the 10s. 6d. which he has paid. The other members have no power to say that he shall not retire, and there is no law that a resignation which cannot be refused must be accepted before it can take effect. If, therefore, a member of this association chooses, even from mere caprice, to retire from it, he can do so at any time without the consent of the other members, and in order that he may become a member again he must be re-elected. (See also Kay LJ at 416 and AL Smith LJ at 417)
In Redhead Grange Inc v Davidson (2002) 55 NSWLR 14; [2002] NSWSC 90, Brownie AJ outlined several qualifications to this principle at [5]-[8]: [5] The Defendants contend that they were entitled to resign as members, because there was nothing in the constitution of the Plaintiff Association that prevents that conduct, and they rely upon the decisions in Finch v Oake [1896] 1 Ch 409 (cited with apparent approval by Windeyer J in Marks v The Commonwealth of Australia (1964) 111 CLR 549 at 571) and Elmawey v Adelaide Mosque Islamic Society of South Australia Inc, Supreme Court of South Australia, Williams J, 3 December 1997, not reported), at 9 to 10 in the Austlii print out. The Plaintiff contends that upon the proper construction of its constitution, resignation was effectively prevented. [6] I think it is established that, if the Rules of an Association do not make any provision to the contrary, a member might resign unilaterally, perhaps even by implication by not complying with his or her obligations as a member for a significant period: In re Sick and Funeral Association of St John's Sunday School, Golcar [1973] 1 Ch 51 at 61-63. [7] If the membership of an Association does not expose the member in question, or other members, or other people to possible adverse consequences, it is sometimes easy to infer from the terms of the constitution of the Association that there is no rule preventing a member from resigning, but if the cessation of membership might produce adverse consequences to others, then the proper construction of the rules might more easily lead to the conclusion that the rules do prevent, or inhibit resignation. This is, perhaps, no more than to say that it is necessary to construe the words of the constitution in their context. [8] Thus, in Field v Battye [1939] SASR 235, Murray CJ at 240-244 and Richards J at 245-248 found that the Rules in question there, properly construed, did prevent a member from resigning; and they came to this conclusion, in part, by considering what would be the consequences of resignation, and what was the deemed intention of those who drafted the Rules. [Emphasis added].
His Honour was dealing with a case where it was the member who sought to establish the validity of a unilateral resignation from membership of the association, in circumstances where significant liabilities were attached to the membership in favour of the association. In that context, his Honour referred to the possibility that "the cessation of membership might produce adverse consequences to others". The issue in that case was whether the constitution of the association on its proper construction permitted members to resign unilaterally. As noted above, rule 6 of the Rules expressly prohibits a member from resigning from the Club unless the member has paid all amounts payable to the Club. Provided that is done, and the requisite notice in writing is given to the committee, the right to resign is automatic. That suggests that the purpose of rule 6 is not to enable the Club to retain members against their will, but is only to ensure that they have paid all amounts due to the Club before they are permitted to resign unilaterally. The condition governing the right of members to resign is for the benefit of the Club. That construction of the rule is consistent with the use of the expression "not entitled" in rule 6(1), as has been observed above.
If that is the effective purpose of rule 6, the question becomes whether, on the proper construction of the Rules, the Club can accept a resignation in a case where the member has not paid what is due, by means of the Club waiving the entitlement to insist upon a formal resignation in compliance with rule 6, as the waiver would be of a condition inserted for the benefit of the Club.
In this respect, it is to be noted that the effect of rule 9 of the Rules is that the liability of a member to contribute towards the payment of the debts and liabilities of the Club and other costs, charges and expenses is limited to the amount, if any, unpaid by the member in relation to fees and subscriptions payable under rule 8. As that is unlikely to be a large amount, there may be little benefit to the Club in insisting that members comply with rule 6 before their resignation is effective.
As for the type of conduct which is sufficient to amount to cessation of membership by conduct, in Elmawey v Adelaide Mosque Islamic Society of South Australia Inc (Supreme Court (SA), Williams J, 3 December 1997, unrep) at 12-14, Williams J said: It seems to me that (prior to 12 August 1995) a person who becomes a member of the Defendant Association can only lose that membership by resignation or by a sufficient display of lack of interest as to amount to an abandonment of membership… The rules of the Defendant (as they stood prior to 12 August 1995) contain no express provision for resignation…The principles relating to resignation from an association are discussed by Megarry J in re Sick and Funeral Society of St John's Sunday School, Golcar (1973) 1 Ch51 at 62: "The question, of course, is not one of expulsion, or of the society snatching at some trivial or short-lived breach of rules by a member to deny him membership: it is a question of a voluntary disregard of the obligations of membership over a continuous period of years. There must be many instances in clubs up and down the country in which this sort of thing happens. Yet if the contentions on behalf of the four members are right, either the society or the members concerned may, if it suits them, claim that the membership is still in being. Such members might find that the society is claiming many years' arrears of a substantial subscription, or the members might, as here, suddenly reassert their membership when some advantage turns up. I do not think that this can be right. It seems to me that the answer, or an answer, lies in the decision of the Court of Appeal in Finch v Oake [1896] 1 Ch 409, which I mentioned in the course of argument. This established that a member of a society has the unilateral right, not dependent on acceptance by the society, to resign his membership at any time, even though the rules contain no provision as to resignation. In that case, the member wrote a letter saying that he desired to withdraw his name as a member of the society, and that was held to be sufficient. There can be no magic in the word "resign", nor in whether the resignation is written or oral. The essence of the matter seems to me to be whether the member has sufficiently manifested his decision to be a member no more. I cannot see why such a manifestation should not be by conduct instead of by words: the only question is whether the member's decision has been adequately conveyed to the society by words or deeds. In short, in addition to resignation by words, I think there may be resignation by conduct; and I do not see why in a proper case a sufficiency of inertia should not constitute resignation by conduct. The point seems to lack authority, and so I must resolve it on principle. I am not suggesting that the mere failure to pay weekly subscriptions for a few weeks or quarterly subscriptions for two or three quarters would suffice per se: but three years and more is another matter. No reasonable man is likely to feel any real doubt about the intentions of a member of a society who for over three years has failed to make his weekly or quarterly payments, and has put forward not a word to suggest that this was due to some mistake, or that he has done some acts showing an intention to continue a member. As I have indicated, among the many thousands of clubs and societies in the country there must be many cases of members whose membership has never been terminated in accordance with any provisions in the rules, and yet who are regarded as still being members neither by themselves nor by the club or society. If their membership is said to have "lapsed," that may be another way of describing a tacit resignation. However it is described, it seems right that there should be such a doctrine, so that neither the member nor the club or society should be able to claim against the other on the basis that what has long been dead de facto still lives de jure. A moribund membership ought not to be capable of resurrection. [Emphasis added].
In Imam Ali Islamic Centre v Imam Ali Islamic Centre Inc [2018] VSC 413 (Imam Ali Islamic Centre), the rules of the relevant association provided the following in relation to the cessation of membership: Ceasing Membership (1) A member of the Association may resign from the Association by giving two weeks notice in writing specifying to the Secretary of his or her intention to resign. (2) After the expiry of the period referred in subrule (1) - a) the member ceases to be a member; and b) the Secretary must record in the register of members the date on which the member ceased to be a member.
The only significant difference between this provision and rule 6 of the Rules is that the latter is conditional on the member having paid what they owe to the Club by reason of their membership for the benefit of the Club. McMillan J stated (footnote omitted): [625] The amended rules contemplated that a member may resign by giving two weeks' notice in writing (clause 7(1)). The existence of that clause must impose some limited restrictions on the otherwise operative general principle that a member may resign at any time. However, the clause does not preclude resignation on any other basis. Relevantly, it does not exclude the operation of the general rule that a member may be found to have resigned his or her membership by reason of a long standing lack of involvement, a continuing failure to participate in the association's affairs, or a voluntary disregard of the obligations of membership over a series of years. [Emphasis added].
In the appropriate case, non-payment of the membership fees payable to an association may be sufficient evidence of an intention on the part of a member no longer to be a member. In Imam Ali Islamic Centre, McMillan J provided the following summary of the effect of non-payment on association membership: (footnotes omitted): [505] To the extent that a member has met his or her contractual obligations, for example, by paying any relevant subscription fee, he or she may unilaterally resign from the membership of the association at any time. Whether a member has resigned is a question of fact based upon a member's expression of intention. That intention may be inferred from conduct, including a long standing lack of involvement, a continuing failure to participate in the association's affairs, or a voluntary disregard of the obligations of membership over continuous period of years. Although the mere failure to pay annual subscriptions, in circumstances where there is no provision in the association's rules for the automatic cancellation of membership for non-payment, may not amount to conduct warranting the inference of resignation, prolonged non-payment over many years will likely constitute abandonment of the membership. Where a member has resigned or abandoned his or her membership from an association, he or she may only re-join the association in accordance with the ordinary process under the association's rules. [Emphasis added].
The applicable legal principle was stated succinctly by Wilson J in Faamate v Congregational Christian Church in Samoa-Australia (Ipswich Congregation) [2019] QSC 194 (Faamate), where her honour said: [226] The existence of a clause in the constitution providing for resignation by way of notice to the secretary or to a general meeting does not preclude resignation on any other basis.
By footnote 290, Wilson J cited as the authority for this proposition: Imam Ali Islamic Centre at [625] per McMillan J citing Finch v Oake , and In re Sick and Funeral Society of St John's Sunday School, Golcar [1973] Ch 51, 62 per Megarry J.
Care must however be taken not to confuse mere inactivity for a period that is not consequential for conduct that manifests an intention on the part of a member no longer to be a member.
It seems to be entirely logical that, when a member of an association has not resigned in compliance with the formalities contained in its constitution, but over a long period of time has by the member's conduct sufficiently manifested an intention to cease being a member, that implied resignation or abandonment of membership should be effective, subject to contrary provisions in the constitution. Otherwise, in cases where the membership is truly moribund, the association could sue to enforce the member's obligations many years after the effective cessation of membership, or the member could opportunistically seek to share in some windfall received by the association, when the member has long since ceased to participate in the affairs of the association that have given rise to the benefit. Where the constitution of the association contains express formalities that govern resignation, to ensure that the association is not unilaterally deprived of its rights against members, a long dormant member should not be entitled to use the express term opportunistically to insist upon the continuation of their membership against the will of the association, having de facto ceased to be a member without complying with the rules governing resignation.
So, in the case of rule 6 of the Rules, members could at any time resign by complying with the formalities, provided that they had paid all amounts payable to the Association in respect of their membership. If a member ceases to participate in the affairs of the Club for years and does not pay membership fees, the member should not be entitled to avail themselves of their own failure to comply with rule 6, to insist upon the continuation of their membership, when it is advantageous for them to do so, in the face of the willingness of the Club to waive the condition in rule 6(2) that is plainly inserted for the benefit of the Club.

Effect of rule 6(3) of the Rules

At par 24 of their written closing submissions, the defendants made a submission that the effect of rule 6(3), on its proper construction, is that the method of resignation set out in rule 6(1) and (2) requiring written notice is not the only means permitted by the Rules in which a member can resign their membership. The submission focused on that part of rule 6(3) that says: "Where a member of the association ceases to be a member pursuant to clause (2), and in every other case where a member ceases to hold membership, the secretary shall…" The defendants argued that, as this rule recognised that a member may cease to hold membership in a case that did not comply with rule 6(2), the Court should find that the Rules allowed for an effective resignation from membership without the giving of the notice required by rule 6(2).
I have already found that a member's resignation may be effective without compliance with rule 6(1) and (2), but that is because the Club may waive the necessity for compliance and accept the validity of an informal resignation. I do not accept that the wording of rule 6(3) affects the issue, because I consider that the reference to "every other case where a member ceases to hold membership" looks back to where rule 4 provides that a person may cease to be a member of the Club if the person dies or is expelled from the association, in addition to having resigned. Rule 6(3) refers to cessation by death or expulsion, and does not in express terms recognise the validity of an informal resignation.

Relief to reinstate membership

The Court has to this point considered the legal principles that govern when a member of an incorporated association's membership ceases. If a member who has not paid membership fees or participated in the affairs of the association for many years establishes that their membership continues to be valid, the failure of the association to treat the membership as valid would be a contravention of the constitution. In that case, the question arises as to what remedies are available to the member to achieve practical reinstatement of their membership, and whether the entitlement of the member is qualified in any way.
In the case of the Club, rule 7 of the Rules requires the public officer of the Club to establish and maintain a register of members. As noted above, the Club has never complied with that rule. That suggests that any party who establishes an entitlement to membership of the Club may have a right to an order against the Club that it cause its public officer to comply with rule 7 in respect of all valid members of the Club. That order could be made with an order requiring the Club to cause its public officer to record the successful plaintiff's details in the register, and also for the Club itself to recognise and comply with the member's rights under the Rules.
Even though there is no equivalent in the 2009 Act to s 175 of the Corporations Act 2001 (Cth), which gives to the Court a statutory jurisdiction to make orders for the correction of a register maintained by a company or a registered scheme, it is clear that the Court has an equivalent jurisdiction in equity that arises out of the fact that, by reason of s 26(1) of the 2009 Act, the Rules constitute a contract between people who are entitled to be members and the Club. As Black J said in Gouros v Order of AHEPA NSW Inc [2023] NSWSC 1281: [150] I outlined the scope of s 175 of the Corporations Act in Re Motasea Pty Ltd (2014) 97 ACSR 589; [2014] NSWSC 69 at [47] as follows: [s]ection 175 of the Corporations Act provides, relevantly, that a person aggrieved may apply to the court to have a register kept by a company corrected … That section operates in parallel to, and arguably assumes the existence of, the court's equitable jurisdiction to rectify a register: Grant v John Grant & Sons Pty Ltd (1950) 82 CLR 1 at 51; Peninsula Gold Pty Ltd v Sunbeam Victa Holdings Ltd (1996) 20 ACSR 553 at 558 -559. The authorities recognise that the applicant for rectification must show a personal equity that the court will protect; prima facie, such an equity is shown if a person's name is wrongly omitted from the register; however, the court has a broad discretion whether to order the correction of the register of members and may decline to order rectification if there is some reason why that should not occur: Grant above at 51. I summarised the relevant principles in Re Mogul Stud Pty Ltd [2012] NSWSC 1639 at [7] as follows: … That section does not itself confer a power to create a register, but assumes that the Court already has such a power at general law: Peninsula Gold Pty Ltd v Sunbeam Victa Holdings Ltd (1966) 20 ACSR 553; 14 ACLC 1089 at 1094. In the well known decision of Grant v John Grant & Sons Pty Ltd (1950) 82 CLR 1 at 51 , Fullagar J pointed to the discretionary character of the power to order rectification of the register and to the fact that in equity warranty rectification would prima facie be established if a person's name was wrongly included or omitted from the register; the same principle is plainly applicable where, rather than the person's name being omitted, the number of shares attributed to that person is incorrectly recorded, so as to impose a disadvantage on that person or on other shareholders. The principles of rectification at general law are relevant, and those draw attention to where the position as recorded in a document reflects the common subjective intention of the parties: Franklins Pty Ltd v Metcash Trading Ltd [2009] NSWCA 407; (2009) 76 NSWLR 603 at [444] and following.
See also his Honour's judgment in Re Centura Holdings Pty Ltd [2016] NSWSC 62; (2016) 111 ACSR 185 at [53].
The statement of principle in Grant v John Grant & Sons Pty Ltd (1950) 82 CLR 1; [1950] HCA 54 that Black J referred to was the following made by Fullagar J at 51-52 of the CLR citation: The power to order rectification of the register must clearly, I think, be in all cases discretionary. The person claiming rectification must show that he has some equity which the court will protect. If he is a shareholder, then prima facie he shows such an equity if he establishes that a name is wrongly included in or omitted from the register of his company. Some definite reason must be shown, I would think, for refusing rectification before rectification will be refused. But there may be circumstances which justify, or even compel, refusal... Equitable remedies are not, generally speaking, granted unless the court is "satisfied of the justice of the case".
These principles were developed in Re Pacific Springs Pty Ltd [2020] NSWSC 1240; (2020) 148 ACSR 454 by Rees J, as follows: [125] Finally, as Young CJ in Eq noted in Kirwan v Cresvale Far East Ltd (in liq) (2002) 44 ACSR 21; [2002] NSWCA 395 at [335] (Meagher JA agreeing with Young CJ in Eq on this issue): …An application to set aside an allotment of shares on the basis that the allotment was an improper exercise of the directors' duties, is a claim in equity. Even though s 175 of the Corporations Act gives statutory authority for the correction of the register, the correction is ordered applying the principles of equity. As such, the relief is equitable in nature and an order seeking rectification under section 175 of the Corporations Act is discretionary: Re Motasea Pty Ltd (2014) 97 ACSR 589; [2014] NSWSC 69 at [47] per Black J; Re Centura Global Holdings Pty Ltd (2016) 111 ACSR 185; [2016] NSWSC 62 at [53] per Black J. Accordingly, the plaintiffs' relief is subject to be refused on the established bases for refusing equitable relief, including by reason of delay, laches, acquiescence and hardship. [126] Thus, for instance, in Ansett v Butler Air Transport Ltd (No 1) (1957) 75 WN (NSW) 299 at 303 , Myers J held that resolutions passed by a board of directors issuing certain shares were invalid, being motivated by a desire to ensure there was always a majority of shareholders to carry out the policy which the directors thought best. Notwithstanding, a claim for rectification of the share register made after a delay of some eleven months in commencing the proceedings was refused, although the facts are somewhat different from the case at hand as the company was a public one and there was a real likelihood that persons might have dealt with the shares in the belief that the allotment would not be challenged: at 304-305. See further on this point: J D Heydon, M J Leeming and P G Turner, Meagher, Gummow & Lehane's Equity Doctrines & Remedies (5th ed, 2015, LexisNexis Butterworths) at [38-030]. (I note that her Honour's formulation of the principles extracted above was not disturbed on appeal in Mualim v Dzelme [2021] NSWCA 199; (2021) 157 ACSR 367.)
In my view, the authorities that establish that there is jurisdiction in equity for the Court to make orders for the maintenance and correction of registers required to be maintained by companies apply with equal force to a register required to be kept by an association incorporated under the 2009 Act. The equitable principles referred to are of general application and arise out of the underlying contractual rights as between the association and its members.
The result is that the Court in its equitable jurisdiction has the power to order the Club to cause its proper officer to create and maintain the register of members required by rule 7 of the Rules, and to enter in the register the names of any plaintiff who is successful in these proceedings in establishing that they are members of the Club. However, those remedies are discretionary and are subject to being defeated by generally available equitable defences such as, as is relevant in the present case, the defence of laches and delay in commencing these proceedings seeking to be treated members.

Membership status of plaintiffs other than Mr and Ms Diener

In my view, the decisive fact in the claims of all of the plaintiffs, other than Mr and Ms Diener, that they are members of the Club, is the length of time over which those plaintiffs have not participated, or have not participated in any continuing meaningful way, in the affairs of the Club; they have not attended annual general meetings, and they have not paid membership fees.
The position is, as has been set out above in relation to the parties' summaries of their cases:

Mr Williams became a member in 1992 or 1993 and has not paid membership fees or participated significantly in the Club's affairs since 2009, a period of 14 years.
Mr Hernandez became a member in 2003 and has not paid membership fees or participated significantly in the Club's affairs since 2006, a period of 17 years.
Mr Hajidavid became a member in 2000 and has not paid membership fees or participated significantly in the Club's affairs since 2008, a period of 15 years.
Mr Gottardo became a member in 1983 and has not paid membership fees or participated significantly in the Club's affairs since 1993, a period of 30 years.
Mr Schofield became a member in 1980 and has not paid membership fees or participated significantly in the Club's affairs since 2007, a period of 16 years.
Mr Gatt became a member in 1980 and has not paid membership fees or participated significantly in the Club's affairs since 1994, a period of 29 years.
Mr Bond became a member in 1963 and has not paid membership fees or participated significantly in the Club's affairs since 1999, a period of 24 years.
Mr Zammit became a member in 2000 and has not paid membership fees or participated significantly in the Club's affairs since 2007, a period of 16 years.
Mr Andrews became a member in 1993 and has not paid membership fees or participated significantly in the Club's affairs since 2009, a period of 14 years.
Mr El-Helou became a member in 2008 and has not paid membership fees or participated significantly in the Club's affairs since 2012, a period of 11 years.

I find that the level of inactivity in each case, even where the period was only 11 years, is sufficient to demonstrate that the plaintiffs have ceased to be active members of the Club, and that they have abandoned their membership and impliedly communicated with the remaining members that they did not want to participate as formal members of the Club. That is so notwithstanding, in some cases, the occasional involvement of the plaintiff with the Club or a member of the committee. In making this finding, I have had regard to the nature of the Club and its activities, being a small social sporting group, whose activities are manifested in engagement in pigeon racing at regular intervals during the racing season. It is not the type of association for which participation of members is irregular and consistent with dormant intervals. It is just not realistic for the plaintiffs to say, after the periods of their dormancy as members, that they have to the date of the hearing regarded themselves as being current members of the Club, notwithstanding their extensive defaults in paying their membership fees.
I am satisfied that the evidence proves that, even though the historical practice of the Club in noting the identities of continuing members and receiving membership fees at or shortly after the holding of the annual general meeting was not incorporated formally in the Rules, it must have been understood by all of the plaintiffs that participation in that process was the means of signifying in fact to other members of the Club that the plaintiffs wished to continue on an annual basis their membership of the Club. That being the case, in a real way, the failure of the plaintiffs, year on year, to participate in the annual general meeting and to signify their desire to be treated as continuing members by the payment of their membership fees, would have positively, albeit implicitly, communicated to the remaining active members of the Club that the plaintiffs no longer wished to be members.
I therefore hold that none of the plaintiffs other than Mr and Ms Diener have established that they were members of the Club at the date of the hearing in these proceedings.
I have come to that conclusion without having to have regard to the fact that the plaintiffs who the defendants accepted had become members after the date of the incorporation of the Club had not complied with the entry requirements in rule 3 of the Rules, but nonetheless argued that they would only cease to be members, if the formal requirements of rule 6 of the Rules were satisfied. As I have recorded above, although the defendants in the summary of their cases expressly accepted that these plaintiffs had become members, I consider that that was on the basis of the perceived need on the part of the defendants to be consistent in their case. They could not reasonably have argued that the informal rules of the Club as to the renewal of membership on an annual basis at the annual general meeting governed the continuation of the plaintiffs' membership, and then have argued that the relevant plaintiffs had not become members because their membership applications did not comply with rule 3 of the Rules. However, had it been necessary to do so, I would have found that the plaintiffs who became members after the date of incorporation of the Club are not permitted to approbate and reprobate. If they wished to be treated as members, having only been admitted by the informal process that was inconsistent with rule 3, they could not insist upon remaining members if they had not complied with the informal process of the Club for that purpose, and insist that they remained members because of the non-compliance with rule 6.
I acknowledge in relation to the case of Mr Williams that he has a fair argument that he was effectively expelled as a member of the Club in about 2006, on the basis of an allegation of infidelity between Mr Williams and the wife of another member. The plaintiffs suggested the year was 2006 in par 73 of their written closing submissions. Any constructive expulsion of Mr Williams did not conform to the procedure in rules 10 and 11 of the Rules. It may be that if Mr Williams had acted with reasonable expedition, he could have persuaded the Court to exercise its discretion in his favour to order the Club to cause its proper officer to create a register of members and to add Mr Williams' details to the register. However, I consider that a delay of 14 years is too great to justify the Court in exercising its discretion in Mr Williams' favour.
I would, in any event, have exercised my discretion against granting the relief sought by all of the plaintiffs, other than Mr and Ms Diener, if they had satisfied me that technically they remained members of the Club.
The plaintiffs have stood by for periods ranging between 11 and 30 years, and allowed the remaining members of the Club to continue to participate in its affairs. As recorded above, those affairs include the sale of the clubhouse. Although the evidence did not explore the affairs of the Club in detail, it is likely that they have changed over the years. In particular, there was no evidence about the financial significance of the sale of the clubhouse.
There was evidence that a dispute arose in about 2017, in which Mr Diener took strong exception to the imposition of the 100% rule, which was apparently directed at restricting the number of members, or flying members, of the Club before it had acquired a new clubhouse. The evidence was that, putting aside the plaintiffs, there were between eight and 11 other members of the Club. If the plaintiffs whose claims remain on foot had been reinstated as members, that would give 11 additional members, apart from the claims of Mr and Ms Diener. The plaintiffs have not explained why, after so many years, their interest in being active members of the Club has been rekindled. There was no persuasive evidence that their real motivation was to engage in regular pigeon racing. There is a strong appearance that the purpose of these proceedings is for Mr Diener to acquire either voting control, or a blocking power, in the Club's affairs. That would not by itself be a dis-entitling factor in the exercise by the Court of its discretion to grant equitable remedies to the plaintiffs. But it does justify the Court in expecting to receive a proper explanation of the reasons for the plaintiffs in bringing these proceedings, so the Court would understand the effect on the remaining members of the Club of the Court making orders that reinstated the plaintiffs as members. I consider that that explanation is lacking.
It has not been necessary for the Court to decide the claims of the plaintiffs, other than Mr and Ms Diener, on the basis of the arguments put by the defendants that the plaintiffs are not entitled to be reinstated as members, because a number of the plaintiffs had made admissions that they were no longer members, and a number of the plaintiffs resided outside the membership catchment area for the Club.
Had it been necessary to do so, I would have held that an admission by a plaintiff that they were not a member of the Club would have been immaterial, if the evidence had otherwise established that the plaintiff was lawfully entitled to membership.
Also, I would have held that, as there is no residential restriction on membership in the Rules, an informal requirement of that nature would have been irrelevant (given, in particular, that a person may be a member of the Club and not a flying member).
In relation to Mr Zammit's claim, some confusion arises out of the reference in the defendants' summary to Mr Zammit being suspended from the Club in 2007. The plaintiffs' submissions do not make anything out of this issue, save to say that it was a reason why Mr Zammit had a justification for not paying membership fees after 2007. The plaintiffs noted in par 48 of their written submissions in reply that Mr Zammit had not claimed that he was denied natural justice. The assertion that Mr Zammit had been "expelled" from the Club was made by Mr Hill in par 136 of his 5 May 2020 affidavit. The plaintiffs' submissions on the issue were only in response to this assertion. That being the case, there is no need for the Court to refer to this issue further, as it is immaterial.

Alleged resignation of Mr Diener

The defendants' case is that Mr Diener's conduct in 2017 was an effective resignation of his membership in the Club, essentially on the basis of the principle in Finch v Oake.
Mr Diener did not formally resign by complying with rule 6(2) of the Rules.
The defendants' case must be that they have accepted Mr Diener's resignation by waiving compliance with rule 6(2).
The issue of whether Mr Diener resigned his membership of the Club is factually different to those plaintiffs who ceased to take part in the activities of the Club and pay membership fees for periods ranging from 11 years to 30 years. Mr Diener became a member of the Club in 1964, and had therefore been a member for 53 years by 2019; I take it as an active flying member.
Resignation from the membership of an association of which one has been a member for more than half a century is a serious matter that is not to be inferred lightly. That is particularly so as the evidence is that Mr Diener had paid his membership fee for the relevant year.
The defendants did not plead the circumstances which they allege constituted the resignation of Mr Diener's membership in their defence. In the defendants' summary, they merely asserted that Mr Diener resigned in 2017.
The defendants' case emerges from par 68 of the affidavit of Mr Hill sworn on 5 March 2020, where he said: Rudy attended meeting for the Club on 24 February 2017 and had words to the effect: Rudy: I am resigning from the club. I can't fly here anymore. Me: You should be careful; you may end up with nowhere to fly. Rudy: I can just sit at home and look at my pigeons. I do not want to be part of Rooty Hill Club anymore.
Mr Hill then referred to the minutes of the meeting on 24 February 2017, which were admitted into evidence as Exhibit P3. The minutes are in handwriting in a diary for 24 February 2017. The minutes refer to Mr Gatt's application for membership and that he was told: "NO NEW MEMBERS UNTIL WE GET NEW CLUB HOUSE". They then record that there were three votes for and six votes against Mr Gatt's application. The minutes then state: RUDY SAID RULE CANNOT STAND SO WE VOTED. M. GARCIA. NOT FINANCIAL THEN RUDY SAID Phil HILL F ZIMMER RON WILLIAMS D. ASTON A [illegible] NOT FINANCIAL RINGS NOT PAID FOR RUDY TOLD MEMBERS HAVE UNTIL FIRST RACE TO PAY. MEETING WENT INTO SLANGING MATCH MEETING ADJOURNED RUDY LEFT CLUB RESIGNED AS RACE SEC & SAID HE WOULDN'T FLY RHD
Mr Diener was at the time of this meeting the Club's ring secretary. Rings were provided by the ring secretary to flying members of the Club. The rings were an essential aspect of pigeon racing as a ring had to be attached to each racing pigeon. Members had to pay the ring secretary for the use of the rings.
The following observations may be made about the significance of the minutes:

The entries in the minutes relating to Mr Diener followed the rejection of Mr Gatt's application for membership of the Club, which was based on what the evidence suggests was a contentious policy under which some members believed that no new members should be accepted until a new clubhouse had been acquired.
Mr Diener is recorded as having stated that the rule cannot stand. The recorded words: "SO WE VOTED" appear to refer back to the vote to reject Mr Gatt's application to be admitted as a member of the Club. There is no other vote to which it could refer.
The minutes record that Mr Diener made remarks about some members having not paid for their rings and that he set a deadline for payment.
The reference to the: "MEETING WENT INTO SLANGING MATCH" clearly suggest that the exchanges at the meeting between those present became very heated.
The minutes then record that the meeting was adjourned.
The entry: "RUDY LEFT CLUB" conveys the meaning that Mr Diener left the meeting after it had been adjourned. Therefore, anything that he said about resigning from the Club was not said formally at a meeting of its members in the presence of the committee.
The words: "RESIGNED AS RACE SEC" are not consistent with Mr Diener having resigned his membership of the Club, rather than his position as race secretary (which may be the same as ring secretary).
The entry: "& SAID HE WOULDN'T FLY RHD" can only mean that Mr Diener would not race his pigeons from the Club (i.e. RHD). That is not the same as Mr Diener saying that he would no longer be a member of the Club. Persons can be members of the Club without being racing members.

Mr Harris' evidence on this subject was given in his affidavit sworn on 6 March 2020, in which he said: 32. At the meeting Rudy stated words to the effect of: Rudy: I am disappointed that Manuel Gatt did not get in. It has been happening awhile that people have been knocked back for years. If you are going to be like this, I do not want to be part of the Club. 33. A short time after Rudy left, I received a phone call from Rudy. It sounded as though he was still driving. I was still at the Club. We had a conversation to the effect of: Rudy: Can you please collect the Ring Secretary books from me. I don't want to be part of the Club. I will just join Blacktown.
Mr Harris gave evidence of arranging sometime later for Mr Diener to return to the Club what he described as the ring secretary books.
In cross-examination, Mr Harris said at T 443.40-T 445.11: Q. Rudy resigned as the ring secretary; correct? A. No. I don't think he did that that day. I think he - I don't know if it's this meeting. He stormed out and he rang me while he was driving, saying, "I don't want to be part of this", and, "Can you pick up the ring secretary books", or something like - words to those effect, yeah. Something like that, but I don't know whether he just - at that meeting he just went, "I'm chucking in the ring secretary job." I can't really recall that. … Q. What he said to the club - and you were there - what he said is, "I'm sick of the club" - I withdraw that - what he said is, "I'm not going to be ring secretary anymore and I'm not going to fly with the club anymore", that's what he said? A. No, he didn't. He just said, "I don't want to be part of this." … Q. I want to also put … he never said to you that he was going to resign from the club? A. In words? What does he have to say? He just said, "I don't want to be part of this." What does that mean? …
Mr Zimmer, in his affidavit sworn on 6 March 2020, gave the following evidence of a conversation that he said he had with Mr Diener at Mr Zimmer's house about a week or two after the 2017 annual general meeting of the Club: 20. To the best of my recollection, Rudy and I had a conversation in words to the following effect: Rudy: I'm not happy. You are doing the wrong thing. The Club is not doing the right thing. Me: What are you talking about? You miss so many meetings and not once have you come to a meeting asking for things to be done differently. Now you are saying that things are wrong. Rudy: Well it's all rubbish that gets said at the meetings sometimes. It's not right that previous members that were part of the club have not been allowed to re-join. Me: It is only temporary that we are not allowing new members. Everyone agreed. If you are not happy you should have said something at the meeting. Rudy: I will take this to the Federation. If I have to bring the club down, I will bring it down. 21. During a meeting held at the Club in February 2017, Rudy attended the meeting with Mr Manuel Gatt. I recall hearing Rudy stating: Rudy: I don't want to be part of the club.
Mr Diener simply said in par 29 of his 23 July 2020 affidavit in reply that he told Mr Harris that he did not want to be the ring secretary anymore, as he felt he had been let down by some of the members, as they would not let in a flyer who had been a member for at least 16 years. He said that no longer being the ring secretary had no bearing on his membership.

Remedies on Mr Diener's claim

As Mr Diener remains a member of the Club at law, he has standing to seek an order in terms of prayer 2 of the amended statement of claim declaring that, at the time of judgment, he is a member of the Club.
As these proceedings were commenced on 12 December 2018, Mr Diener's claim cannot be rejected on the basis of laches or delay.
Mr Diener is also entitled to an order against the Club that it cause its proper officer, which I understand will be the secretary, to create and maintain a register of members in conformity with rule 7 of the Rules and to enter into the register the required details of his membership.
Apart from the fact that rule 7 of the Rules requires the Club to maintain a register of members, if anything is established by these proceedings it is that it is fundamentally in the interests of the Club and its members to ensure that records are properly kept so that the membership of the Club will clearly be established from time to time.
I will deal with Mr Diener's claim for a declaration that the October 2017 Constitution is invalid separately below.

Basis of Ms Diener's claim to be a member of the Club

The plaintiffs alleged in par 9 of the amended statement of claim that Ms Diener, the third plaintiff, became a member of the Club in or around 2011 and has not resigned from membership or been expelled. The amended statement of claim does not plead the facts upon which Ms Diener's claim to have become a member of the Club is based.
The most complete statement of the basis of Ms Diener's claim to have become a member of the Club is to be found in par 67 of the plaintiffs' written closing submissions, as follows (omitting references to the evidence):

Ms Diener's evidence is that she became a member in 2013 after Mr Diener informed her that the Club may not have enough members to continue operating. It was decided that Ms Diener would join as a member in her own right, and race a team with Mr Diener.
Mr and Ms Diener say that Mr Diener paid Ms Diener's membership fee to the Club on her behalf.
From 2013, the Club in various of its records referred to Mr and Ms Diener as being two competing members.
Mr Diener's evidence was that a person needed to be a member of the Club to race with it.
As the evidence of Mr Hill was that a member had to pay their race fee by the start of the racing year, it follows that if Ms Diener did race, she must have paid her membership fees to the Club.
While Ms Diener accepts that she never attended Friday night club meetings due to commitments with her spiritual group, she did attend award nights and other club functions.

Ms Diener's claim to be a member of the Club was put on the basis that the Club is estopped from denying her membership.

Application of estoppel principles to membership of an association

In Imam Ali Islamic Centre, McMillan J stated the relevant principle as follows (footnotes omitted): [506] The rules of an incorporated association in Victoria constitute a contract between the association and its members. At common law, an association's rules are mandatory and estoppel cannot operate to preclude an association from relying upon its rules to determine the validity of the association's membership.
For her statement that estoppel cannot operate in this context, her Honour relied upon Bielski v Oliver (1958) 1 FLR 258, 260 (Spicer CJ, Dunphy and Morgan JJ); and Australian Public Service Association (Fourth Division Officers) v Lawrence (1982) 2 IR 166, 168 (Toohey J). McMillan J also noted the decision of Kavourakis v Waverley Bowling & Recreation Club Ltd [2010] NSWSC 439 at [23]-[36], where Barrett J (as his Honour then was) considered and dismissed an allegation that an association was estopped from denying the membership of the plaintiff.
McMillan J's statement of principle was accepted by Wilson J in Faamate at [219]. Wilson J continued with the following observations (footnotes omitted): [220] Associations are often formed as community organisations and McMillan J was not indifferent to the difficulties faced by organisations when genuinely attempting to comply with difficult legal concepts and technicalities inherent in creating and maintaining an association. However, her Honour concluded that "the Court is nonetheless required to assess the management and operation of the organisation by reference to its statutory source, informed by any relevant general law". [221] In Re Australian Public Service Association v Robin Peter Isaac Lawrence Toohey J explained that: "… it is well established that the rules of an organisation are mandatory and that estoppel cannot operate to preclude an organisation from relying upon its rules to determine validity of membership: Bielski v. Oliver (1958) 1 F.L.R. 258".
See also Moala v Free Wesleyan Church of Tonga in Australia (Victoria) Inc [2019] VSC 205 at [427]-[436] per Ginnane J for a discussion of why a person cannot become a member by estoppel of an incorporated association in a case where the person has not complied with the procedure for acquiring membership in accordance with the constitution of the association established by statute.
The evidence given by Ms Diener in support of her claim was very limited. On 14 May 2019, Ms Diener swore a pro forma affidavit of 6 paragraphs that contained no evidence concerning her belief that she had become a member of the Club. Ms Diener swore an affidavit on 23 July 2020 that, in a single brief paragraph, explained that Ms Diener did not attend meetings of the Club on a Friday night, and that she had never been to an annual general meeting or received notice of an annual general meeting. She said that she did attend other Club functions such as award nights. She said that she had participated in pigeon races with the Club from about 2013 to 2016.
Mr Diener gave limited evidence on this issue in his 27 October 2022 affidavit, as follows: 6. [Rejected]. In 2013, the club did not have sufficient members to basket in our Club. I recall having a discussion with the other members of the club. During the discussion, someone said, "The Club doesn't have enough members and we would have to attend another club to basket our pigeons under the Central Cumberland Federation rules." I then said words to the effect of, "If we don't have enough members, then Barbara can join and I'll fly a second team with her. How does that sound?" I don't recall exactly what was said in reply, but it was words to the effect of, "That's a good idea."
It appears to be the case that for a number of years Ms Diener participated in the affairs of the Club, largely through the actions of Mr Diener. She may have been a nominal participant in a pigeon racing team, but there is no evidence that she conducted the races as a principal. Ms Diener apparently participated in a number of social events at the Club, but she did not attend the Club's principal Friday night meetings or its annual general meetings. It may be that for a number of years Mr Diener paid into the Club's bank account an amount to cover Ms Diener's membership fees. There was evidence, however, that part of Mr Diener's role was to collect annual fees for members and to pay them into the Club's bank account.
The evidence appears to be devoid of any direct evidence that any member of the committee made any representation to Ms Diener that she would be treated as a member of the Club. Those members probably had no authority to bind the Club by ignoring the rules concerning the admission of members, but it appears to be the case that no representations were made to Ms Diener in any event. It seems that, as a result of the informal conversation that Mr Diener deposed to, and which has been set out above, Ms Diener was permitted in a limited way to participate in the activities of the Club without her having been required formally to join as a member.
Ms Diener has not given evidence of the circumstances in which she was led to believe that she was a proper member of the Club, and she has not said in any material way that she acted on that belief, or that she will suffer any detriment if the Club asserts that she is not a member. All that will happen is that she will be deprived of the informal benefits that she enjoyed while the Club permitted her limited participation in its affairs as if she were a member.
The result is that Ms Diener's claim must fail, both because the common law does not permit her to assert against the Club that it is estopped from denying that Ms Diener has not satisfied the requirements for membership in the Rules, and because, even if estoppel were available, Ms Diener has not proved a factual basis for the Court to find an estoppel against the Club.

Validity of the October 2017 Constitution

When the plaintiffs filed their amended statement of claim on 1 December 2022, they introduced by prayer 3C a claim for an order declaring that the October 2017 Constitution is invalid.
That application was therefore made in the order of five years after the October 2017 Constitution was resolved by the members of the Club who attended the relevant general meeting to be introduced and to replace the Rules.
The only basis upon which the plaintiffs have alleged that the special resolution to introduce the October 2017 Constitution was invalid is their claim that all of the plaintiffs were members of the Club at the time of the resolution, but they had not been given the notice of the proposal to put the special resolution to members, as is required by rule 25(2) of the Rules.
Although the text of the October 2017 Constitution is in evidence, no reference was made to it by the parties. There was no suggestion by the plaintiffs that there was any serious defect in the October 2017 Constitution.
If the Court had found that a sufficient number of the plaintiffs were members of the Club who had not been given the notice of the intention to put the special resolution to members to which they were entitled under the Rules, then there would be a legal basis for the Court to make an order declaring the October 2017 Constitution to be invalid. That is because the plaintiffs may at least have had enough members to defeat the special resolution.
There would still have been the issue of whether the plaintiffs had established that there was any serious defect in the October 2017 Constitution, and it would have been necessary for the Court to consider whether the plaintiffs' delay in seeking the relief in prayer 3C of the amended statement of claim was a sound discretionary reason for rejecting the claim.
As it is, the result of these proceedings is that only Mr Diener has established that he is a member of the Club. It appears Mr Diener was wrongly excluded from the members who were given notice of the intention to put the special resolution to introduce the October 2017 Constitution.
There is no evidence of the result of the voting of the members of the Club when they resolved by special resolution to introduce the October 2017 Constitution. Accordingly, the Court does not know whether it would have made a difference if the Club had recognised Mr Diener's membership and given him notice of the general meeting.
As Black J has explained in In the matter of Order of AHEPA NSW Inc [2018] NSWSC 458: [20] Section 1322 of the Corporations Act relevantly provides that: 1322 Irregularities (1) In this section, unless the contrary intention appears: (a) a reference to a proceeding under this Act is a reference to any proceeding whether a legal proceeding or not; and (b) a reference to a procedural irregularity includes a reference to: … (ii) a defect, irregularity or deficiency of notice or time. … (4) Subject to the following provisions of this section but without limiting the generality of any other provision of this Act, the Court may, on application by any interested person, make all or any of the following orders, either unconditionally or subject to such conditions as the Court imposes: (a) an order declaring that any act, matter or thing purporting to have been done, or any proceeding purporting to have been instituted or taken, under this Act or in relation to a corporation is not invalid by reason of any contravention of a provision of this Act or a provision of the constitution of a corporation; … (d) an order extending the period for doing any act, matter or thing or instituting or taking any proceeding under this Act or in relation to a corporation (including an order extending a period where the period concerned ended before the application for the order was made) or abridging the period for doing such an act, matter or thing or instituting or taking such a proceeding; and may make such consequential or ancillary orders as the Court thinks fit. … (6) The Court must not make an order under this section unless it is satisfied: (a) in the case of an order referred to in paragraph (4)(a): (i) that the act, matter or thing, or the proceeding, referred to in that paragraph is essentially of a procedural nature; (ii) that the person or persons concerned in or party to the contravention or failure acted honestly; or (iii) that it is just and equitable that the order be made; and … (c) in every case - that no substantial injustice has been or is likely to be caused to any person. [21] This section applies to associations governed by the 2009 Act by reason of ss 96 and 97 of the 2009 Act, which provide for the regulations to declare that certain matters are applied corporations legislation matters within Pt 3 of the Corporations (Ancillary Provisions) Act 2001 (NSW). Regulation 18 of the Associations Incorporation Regulation 2016 (NSW), which declares matters relating to associations to be applied corporations legislation matters in relation to ss 1322(1)-(3A) and (4)-(6) of the Corporations Act, subject to certain modifications, relevantly that a reference to "this Act" in s 1322 is to be read as including a reference to the 2009 Act and a reference to a "corporation" is "to be read as a reference to an association". The operation of a predecessor of that regulation, with similar effect, was noted in Ahmed v Chowdhury [2012] NSWSC 1452 at [87] -[93] and Cambodian Buddhist Society of NSW v Meng Eang Thai [2017] NSWSC 1433 (Cambodian Buddhist Society) at [59]-[60].
The Club has not made an application in these proceedings for an order that will have the effect of validating the October 2017 Constitution, even if it may technically be invalid. As the validation power is required to be exercised liberally (see In the matter of Order of AHEPA NSW Inc at [22]), it is probable that, if the application had been made, the result would have been the continuing validity of the October 2017 Constitution.
As even in the plaintiffs' written closing submissions the only real basis upon which the plaintiffs pursued their claim for a declaration that the October 2017 Constitution was invalid was that they were all members and none had been given notice of the intention to put the special resolution, I consider that nothing is to be gained by making an order that the October 2017 Constitution is invalid, and the making of such an order would only be productive of wasted costs and inconvenience. I would infer that, it is likely that, if it were required to be done, the members of the Club could repeat their approval of a special resolution to introduce the October 2017 Constitution, even if that course were opposed by Mr Diener. Mr Diener has not even given evidence to the Court that he would oppose the special resolution, or that there is any reason for him to do so.
I will exercise the Court's discretion to reject Mr Diener's claim for a declaration that the October 2017 Constitution is invalid.

Order for the production of documents to Mr Diener

The plaintiffs observed in par 119 of their written closing submissions that there may be limited utility to prayer 1 of the amended statement of claim if the defendants agree to provide the books sought by Mr Diener in the event that any of the plaintiffs are found to be members of the Club. Rule 39 of the Rules entitles the members of the Club to inspect the records, books and other documents of the Club, free of charge, at any reasonable hour.
The defendants did not make submissions on this issue in their written closing submissions.
It is likely that the only reason why Mr Diener's requests to have access to the Club's documents was not complied with was that the defendants challenged Mr Diener's membership. There was no suggestion that Mr Diener had asked to inspect documents that he had no right to inspect under rule 39.
In the circumstances, I will simply make an order that the Club perform its obligations under rule 39 of the Rules (or whatever replacement rule may be in effect under the October 2017 Constitution) to allow Mr Diener to inspect the Club's documents.

Costs

The position is that all of the plaintiffs' claims will be dismissed, other than the claim made by Mr Diener for an order declaring that he is a member of the Club, for an order that the Club create and maintain a register of members and that his details be entered in the register, and an order that the Club allow Mr Diener to inspect the documents that he is entitled to inspect under the Club's constitution.
In principle, Mr Diener is entitled to an order that the Club pay his costs of the issues on which he has been successful.
It does not appear why it was necessary or proper for the plaintiffs to continue with the joinder of the three members of the committee as defendants after the plaintiffs abandoned the claim for relief in prayer 3 of the statement of claim.
There may be an argument that the plaintiffs, including Mr Diener, should be liable to pay the costs incurred by the members of the committee after the filing of the amended statement of claim. However, all defendants have at all times been represented by one set of lawyers and it is extremely unlikely that it has been necessary for the defendants to incur legal costs that related to separate issues involving the members of the committee. It is likely to introduce confusion and expense if separate costs orders are made in relation to the costs of the members of the committee.
An order should be made that the unsuccessful plaintiffs pay the costs of the defendants in relation to those plaintiffs' claims that they were members of the Club.
There is no rational way for the Court to make a fair broad-brush judgment that the plaintiffs as a whole should pay a percentage of the defendants' costs to make a proper allowance for Mr Diener's success in the proceedings. The Court does not have sufficient visibility of the forensic effort that was required by the parties in respect of all of the issues in dispute.
I note that, in their written closing submissions, the defendants asked for an opportunity to be heard on the question of costs. That is a reasonable request and would ordinarily be granted. However, if there is to be a hearing as to costs, it will have to be conducted by some other judicial officer than myself.
In the circumstances, I will merely note that, if I had been required to make appropriate costs orders, I would have made orders that reflected the considerations set out above.
I will make an order giving the parties leave to list the matter before the Equity Registrar so that arrangements can be made to deal with the issue of costs. If the parties cannot come to an agreement on that subject, that would lead them to being able to submit agreed short minutes of order to the Equity Registrar.

Orders

The Court's orders are: 1. Order that the claims of the third to twelfth, fourteenth, fifteenth and seventeenth plaintiffs be dismissed. 2. Declaration that the first plaintiff is a member of the first defendant as at the time of judgment. 3. Order the first defendant to create and maintain a register of the members of the first defendant within 28 days of this judgment, such register of members to be created and maintained in compliance with the constitution for the time being of the first defendant. 4. Order the first defendant to cause the details of the first plaintiff to be recorded in the register of members in compliance with the constitution for the time being of the first defendant. 5. Order the first defendant to comply within 28 days of this judgment with any rule in the constitution for the time being of the first defendant that requires it to give inspection of the first defendant's documents to the first plaintiff. 6. Order that the amended statement of claim be otherwise dismissed. 7. Grant leave to the parties to relist these proceedings before the Equity Registrar on seven days' notice to seek orders to give effect to the orders made in these proceedings. 8. Grant leave to the parties to confer as to the costs orders that should be made having regard to the observations made in the Court's reasons for judgment and if agreement can be reached, to submit short minutes of order to the Equity Registrar for arrangements for an appropriate order to be made, and if agreement is not reached, to list the matter by arrangement with the Equity Registrar so that orders can be made to deal with all outstanding issues of costs.

Amendments 02 February 2024 - Removal of hyperlinks 15 February 2024 - Correction to spelling of parties name in par 57 DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 15 February 2024

Associations Incorporation Act 1984(NSW)

Associations Incorporation Regulation 2016(NSW)

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Judgment (35 paragraphs)

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Legislation Cited (5)

Cases Cited (23)