Gosford Christian School Ltd v Totonjian

CATCHWORDS : CORPORATIONS - public companies - management and administration - directors - constitution requires retirement of directors at each annual general meeting - meeting not held - whether offices become vacant at conclusion of year - holder of church position declared by company's constitution to be director ex officio - whether subject to annual retirement - purported action by three directors when two of them no longer in office - effectiveness of participation by third - where constitution permits continuing director to act - effect of failure to maintain minimum number of directors required by Corporations Act - whether act in which one director only participated within s.1322(4)(a) - whether validating order should be made - where no explicit application for such order - whether purported appointment of representative under s.250A defective in form - proceedings at member level in single member public company - passing of resolutions by paper based procedure under s.249B - whether such procedure available where Corporations Act requires meeting - whether right of directors to be given notice of general meetings indicates that meeting must be held to pass resolutions affecting directors - whether right of auditor to be given notice of general meetings and to attend and speak on matters relevant to auditor indicates that meeting must be held to pass resolutions omitting from constituition requirement that accounts be audited - where efficacy of documents depends on signing in particular order - availability of presumption of regularity where evidence shows all signed on one day but does not indicate order

LEGISLATION CITED : Companies Act 1961, ss.16(1), 29(2)(b), 140(3), regs 83, 84 Table A Fourth Schedule Corporations Act 2001 (Cth), ss.117(2)(c), 120(1), 136(2), 136(3). 201A, 201E, 203B, 203D, 205D, 249B, 249J, 250D, 250RA, 250S. 250SA, 251A(1), 300A(1), 301, 327A, 331, 1274B, 1322(2), 1322(4), 1322(6),

Allied Mining & Processing Ltd v Boldbow (2002) 26 WAR 355 Ayre v Skelsey's Cement Co (1904) 21 TLR 464 Briginshaw v Briginshaw (1938) 60 CLR 336 Carpenter v Carpenter Grazing Co Pty Ltd (1987) 5 ACLC 506 Channel Collieries Trust Ltd v Dover St Margaret's and Martin Mill Light Railway Company [1914] 1 Ch 569 CIC Insurance Ltd v Hannan Pty Ltd (2001) 38 ACSR 245 Club Flotilla (Pacific Palms) Ltd v Isherwood (1987) 12 ACLR 387 Dick v Comvergent Telecommunications Ltd (2000) 34 ACSR 86 Drummond v Drummond [1999] NSWSC 923 Harris v Knight (1890) 15 PD 170 Hillig v Darkinjung Pty Ltd [2006] NSWSC 594 Holmes v Life Funds of Australia Ltd [1971] 1 NSWLR 860 Host-Plus Pty Ltd v Australian Hotels Association [2003] VSC 145 Link Agricultural Pty Ltd v Shanahan [1999] 1 VR 466 CASES CITED : Mamouney v Soliman (1992) 9 ACSR 63 McLean Bros and Rigg Ltd v Grice (1906) 4 CLR 835 Morris v Kanssen [1946] AC 459 Poliwka v Heven Holdings Pty Ltd (1992) 7 ACSR 85 Re Ausam Resources Ltd [2004] FCA 823 Re Broadway Motors Holdings Pty Ltd (1986) 6 NSWLR 45 Re Colorbus Pty Ltd; Mentha v Colorbus Pty Ltd (2004) 57 ACSR 677 Re Consolidated Nickel Mines Ltd [1914] 1 Ch 883 Re Continental Pacific Insurance Co Ltd [2002] NSWSC 789 Re Fireproof Doors Ltd [1916] 2 Ch 142 Re New Cedos Engineering Ltd [1994] 1 BCLC 797 Re Pembury Pty Ltd [1993] 1 QdR 125 Re Sly Spink & Co [1911] 2 Ch 430 Sutherland v Robert Bosch (Aust) Pty Ltd (2000) 33 ACSR 680 Twin v Deputy Commissioner of Taxation [2004] 1 QdR 450 Whitehouse v Carlton Hotel Ltd (1987) 162 CLR 285

Gosford Christian School Limited - First Plaintiff Gosford Christian Centre Limited - Second Plaintiff PARTIES : Simon Totonjian - First Defendant Michael Crocombe - Second Defendant Steven Owers - Third Defendant Prolegis Pty Limited - Fourth Defendant

COUNSEL : Ms G.C. Dempsey - Plaintiffs Mr G.O. Blake SC - Defendants

SOLICITORS : Thomson Rich O'Connor - Plaintiffs Prolegis Pty Limited - Defendants

IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION CORPORATIONS LIST

3467/06 GOSFORD CHRISTIAN SCHOOL LIMITED & ANOR v SIMON TOTONJIAN & 3 ORS JUDGMENT

The parties and their dispute 1 Gosford Christian Centre Limited ("Centre") and Gosford Christian School Limited ("School") are both companies limited by guarantee. Each is therefore a "public company" as defined by the Corporations Act 2001 (Cth). Centre was incorporated in 1979 under the Companies Act 1961 for religious purposes. School was registered in 2004 under the Corporations Act 2001 (Cth) for a combination of religious and educational purposes. Centre is a corporate vehicle for activities of a Christian congregation based on the Central Coast. School operates a school on land at Narara owned and leased to it by Centre. Both Centre and School are named as plaintiffs in an originating process filed on 28 June 2006. 2 By the originating process, Centre and School seek, as principal relief, an order restraining each of the first, second and third defendants from acting as a director of School (it will be convenient to refer to them together as "the defendants", even though there is a fourth defendant). There are further claims for relief but, by consensus of the parties, this first claim was agitated as a separate matter, together with a cross-claim by which the defendants seek, as principal relief, declarations to the effect that certain purported resolutions of the members of School passed on 26 June 2006 are invalid. 3 The purported resolutions of the members of School thus attacked by the defendants are the source of the plaintiffs' contention that the defendants are no longer directors of School. At issue is the question of the efficacy of steps taken to remove the defendants from office as directors of School. The documents 4 At the heart of the parties' dispute are three documents which it is necessary to set out in full. One (which I shall call "the appointment document") is in these terms: " Corporations Act 2001 (Cth) s 250D GOSFORD CHRISTIAN CENTRE LIMITED (GCCL) RECORD OF RESOLUTIONS The directors of GCCL hereby appoint Maxwell Warren as the representative of GCCL to Gosford Christian School Limited pursuant to section 250D of the Corporations Act 2001 (Cth). Dated 26th June 2006 Signed by the directors of GCCL: (sgd) Max Warren (sgd) Stuart Curtis (sgd) Kevin Lieschke" 5 Another of the documents (which I shall call "the special resolution document") is in these terms: " Corporations Act 2001 (Cth) s 249B GOSFORD CHRISTIAN SCHOOL LIMITED (GCSL) RECORD OF SPECIAL RESOLUTIONS OF MEMBERS Pursuant to section 249B of the Corporations Act 2001 (Cth), the following special resolutions are passed: 1 The Constitution of GSCL be repealed, save for: 1.1 clauses 1, 6, 7, 30, 51, 52, 68 and 81 through 83 inclusive; 1.2 clause 8, except that the first sentence of clause 8 is deleted; 1.3 clause 9, except that clause 9(a)(i) is deleted. 2 The following clauses be added to the Constitution of GCSL: '85A. The members may by resolution at any time remove any or all of the directors, the chairman, deputy-chairman, secretary, treasurer, or any other company officer from office. Such officers may be removed without notice and prior to expiry of any relevant term of office, and with effect from such time as stated in the resolution. To remove any doubt, such resolution may be resolution passed pursuant to section 249A or 249B of the Corporations Act 2001 .' '85B. The members may by resolution at any time elect such number of directors as the members may fix from time to time.' '85C. The members may by resolution elect a chairman of directors. In the absence of such an appointment or in the event of a casual vacancy the directors shall elect a chairman from among their number.' '85D. The members may by resolution elect a company secretary. In the absence of such an appointment or in the event of a casual vacancy the directors shall elect a company secretary from among their number.' '85E. The directors may at any time pass resolutions by all of the directors for the time being signing a memorandum of the resolution, which may be signed in a single document or in counterparts.' Dated 26th June 2006 (sgd) signed by Max Warren as authorised representative of Gosford Christian Centre Limited Sole member of GCSL" 6 The remaining document (which I shall call "the ordinary resolution document") is as follows:

" Corporations Act 2001 (Cth) s 249B GOSFORD CHRISTIAN SCHOOL LIMITED (GCSL) RECORD OF RESOLUTIONS OF MEMBERS Pursuant to section 249B of the Corporations Act 2001 (Cth), the following resolutions are passed: 1 Pursuant to clause 85A of the Constitution the following directors of GCSL be removed from office with immediate effect: 1.1 each of the directors of GCSL; and 1.2 each of the chairman, deputy-chairman, secretary and treasurer of GCSL from that office. 2 Pursuant to clause 85B of the Constitution, the number of directors shall be six. 3 Pursuant to clause 85B of the Constitution, the following be elected directors of GCSL, with immediate effect: 3.1 Kevin Lieschke;

3.6 Mary Warren. 4 Pursuant to clause 85C of the Constitution, Kevin Lieschke be elected chairman of GCSL. 5 Pursuant to clause 85D of the Constitution, Kevin Lieschke be elected secretary of GCSL. Dated 26th June 2006 (sgd) signed by Max Warren as authorised representative of Gosford Christian Centre Limited Sole member of GCSL" 7 It is contended by the plaintiffs that the execution of these three documents produced legal consequences such that, as from 26 June 2006, none of the defendants was any longer a director of School. It is the contention of the defendants, upon their cross-claim, that the special resolution document was not effective to cause to be passed a special resolution of School and the ordinary resolution document was not effective to cause to be passed a resolution of School. The plaintiffs' contentions 8 The plaintiffs were represented before me by Ms Gillian Dempsey of counsel. The basis on which she advanced the plaintiffs' case is as follows:

1. The only directors of Centre, as at 26 June 2006, were Mr Warren, Mr Curtis and Mr Lieschke.
2. Centre was, as at 26 June 2006, the sole member of School.
3. Centre was, as at 26 June 2006, a body corporate.
4. By virtue of s.250D of the Corporations Act, it was therefore open to Centre to appoint an individual as its representative to exercise powers of Centre in relation to School.
5. That power of Centre was exercisable by the directors of Centre.
6. By the appointment document, Mr Warren became the representative of Centre under s.250D and was therefore able to exercise, in relation to School, the powers referred to in that section which belonged to Centre as the sole member of School.
7. By virtue of s.249B, the special resolution document, once signed by Mr Warren, caused to be passed a special resolution of School in the terms there set out.
8. By virtue of s.136(2) (which allows the constitution of a company to be modified by special resolution), the signing by Mr Warren of the special resolution document caused the constitution of School to take the form stated in the special resolution - so that, in particular, the constitution made provision in the new articles 85A to 85E for the members of School, by resolution, to remove directors from office, to fix the number of directors and to elect directors.
9. By virtue of s.249B, the ordinary resolution document, once signed by Mr Warren, caused to be passed resolutions (not being special resolutions) of School in the terms there set out.
10. Having regard to the form that the constitution of School took as referred to at 8 above, that resolution of School caused the offices of the defendants as directors of School to be vacated. The defendants' contentions 9 Mr G.O. Blake SC appeared for the defendants. Their case is that this analysis breaks down at several points. Their main contentions are as follows:
11. Mr Warren, Mr Lieschke and Mr Curtis were not, as at 26 June 2006, directors of Centre.

2. Centre was not, as at 26 June 2006, a member of School.

3. Even if, as at 26 June 2006, the only directors of Centre were Mr Warren, Mr Lieschke and Mr Curtis and Centre was the sole member of School, the appointment document was not effective to enable Mr Warren to exercise the voting power belonging to Centre as a member of School.

4. Even if the appointment document was effective to enable Mr Warren to exercise the voting power belonging to Centre as a member of School, the special resolution document was not effective to cause to be passed a special resolution of School, with the result that the constitution of School was not modified in such a way as would have been essential to the efficacy of the ordinary resolution document.

Relevant provisions of the Corporations Act 10 Before addressing these contentions, I should set out the two particularly relevant provisions of the Corporations Act. The first is s.250D: " Body corporate representative (1) A body corporate may appoint an individual as a representative to exercise all or any of the powers the body corporate may exercise: (a) at meetings of a company's members; or (b) at meetings of creditors or debenture holders; or (c) relating to resolutions to be passed without meetings; or (d) in the capacity of a member's proxy appointed under subsection 249X(1). The appointment may be a standing one.

(2) The appointment may set out restrictions on the representative's powers. If the appointment is to be by reference to a position held, the appointment must identify the position.

(3) A body corporate may appoint more than 1 representative but only 1 representative may exercise the body's powers at any one time.

(4) Unless otherwise specified in the appointment, the representative may exercise, on the body corporate's behalf, all of the powers that the body could exercise at a meeting or in voting on a resolution.

Note: For resolutions of members without meetings, see sections 249A and 249B." 11 The second provision is s.249B: " Resolutions of 1 member companies (1) A company that has only 1 member may pass a resolution by the member recording it and signing the record. (2) If this Act requires information or a document relating to the resolution to be lodged with ASIC, that requirement is satisfied by lodging the information or document with the resolution that is passed. Note 1: A body corporate representative may sign such a resolution (see section 250D). Note 2: Passage of a resolution under this section must be recorded in the company's minute books (see section 251A)." Who were the directors of Centre on 26 June 2006? 12 There is evidence in an ASIC Company Extract in respect of Centre marked "Report Generated: 30 May 2006 12:11:50 WST" which begins: "Section 1274B This extract has been prepared by the Australian Securities & Investments Commission from information it obtained, by using a data processor, from the national database. If you believe that this extract contains any error or omission please advise the A.S.I.C. promptly. The Information Division of the Australian Securities & Investments Commission is certified under the Australian Quality Standard AS 3901 (International Standard ISO 9001)." That ASIC Company Extract lists as "Current Director" each of Mr Warren, Mr Lieschke and Mr Curtis. Their "Appointment Dates" are shown as 30 November 1986, 9 November 2000 and 15 July 1997 respectively. The space for "Cease Date" is, in each case, blank. 13 Section 1274B of the Corporations Act is in these terms: " Use, in court proceedings, of information from ASIC's national database

(1) In this section: 'data processor' means a mechanical, electronic or other device for processing data.

(2) In a proceeding in a court, a writing that purports to have been prepared by ASIC is admissible as prima facie evidence of the matters stated in so much of the writing as sets out what purports to be information obtained by ASIC, by using a data processor, from the national database. In other words, the writing is proof of such a matter in the absence of evidence to the contrary.

(3) A writing need not bear a certificate or signature in order to be taken to purport to have been prepared by ASIC.

(4) Nothing in this section limits, or is limited by, section 1274 or 1274A." 14 The evidentiary value of the entries concerning Mr Warren, Mr Lieschke and Mr Curtis is as explained in the following extract from the judgment of Austin J in Drummond v Drummond [1999] NSWSC 923 at [32]: "The historical company extract is a writing that purports to have been prepared by the Commission. It begins with the words 'Section 1274B This extract has been prepared by the Australian Securities and Investments Commission from information it obtained, by using a data processor, from the national database.' It follows that the historical company extract is prima facie evidence of, inter alia, the number of shares on issue and the identity of the shareholders in the Company. The earlier records of the Registrar of Companies and the other corporate records corroborate the information about shareholdings contained in the extract." 15 In the absence of evidence to the contrary, I must, by virtue of s.1274B, accept that each of Mr Warren, Mr Lieschke and Mr Curtis was a director of Centre at 30 May 2006, that each had been appointed on the day shown in respect of him and that no other person was a director at that date. 16 Mr Blake SC submitted that any such prima facie position is displaced. He points to several provisions of the constitution of Centre. By article 30(a), the board is to consist of not less than three and not more than nine directors. Articles 35, 36 and 37 are in these terms: "35 . A director shall retire from office at the conclusion of the annual general meeting which shall elect the directors for the ensuing year. 36. A retiring director shall be eligible for re-election. 37. The Company at the general meeting at which a director retires in manner aforesaid may fill up the vacated office by electing a member thereto and in default the retiring director shall be deemed to have been re-elected unless at such meeting it is resolved not to fill up such vacated office. 38. Any casual vacancy occurring in the board may be filled up by the directors but the member so chosen shall be subject to retirement at the same time as if he had become a director on the day on which the director in whose place he is appointed was last elected a director." 17 The matter of convening and holding annual general meetings is dealt with in article 8: "An annual general meeting of the Company shall be held once in every calendar year at such time (not being more than fifteen months after the holding of the last preceding annual general meeting) and place as may be prescribed by the board." (This requirement parallels that in s.250N of the Corporations Act insofar as it contemplates a meeting in every calendar year.) 18 Mr Blake submitted that no annual general meeting of Centre was held in the calendar year 2005, that is, the year from 1 January 2005 to 31 December 2005. As a result, he says, no directors of Centre were in office after 31 December 2005. This is because all ceased to hold office by force of article 35 when the deadline for the holding of the annual general meeting passed without the meeting having been held. Was there an annual general meeting of Centre in 2005? 19 I now consider the contention of the defendants that there was no annual general meeting of Centre in the year 2005. Mr Warren was the main witness for the plaintiffs. He annexed to his affidavit of 6 July 2006 a document described by him as a copy of the minutes of an annual general meeting of Centre held on 7 July 2005. The document does not form part of (or purport to be) a minute book kept in accordance with s.251A(1) of the Corporations Act. It therefore derives no evidentiary value from ss.1305 and 1306 of that Act. But proceedings at a meeting may be proved by the evidence of any person present or by other admissible evidence: McLean Bros and Rigg Ltd v Grice (1906) 4 CLR 835 at p.844. 20 Mr Warren said in cross-examination that he had prepared the minutes as recently as 27 or 28 June 2006, that is, almost a year after the date shown as the date of the meeting. He said that he prepared the minutes from his memory of events at the time and without relying on any notes taken at the meeting, although he did have regard to the agenda for the meeting. He was unable to produce the agenda. Mr Warren was asked whether he had any recollection of the meeting on 7 July 2005. He answered: "A. Precisely that meeting - I'm sorry, I am pausing because there were so many meetings. Precisely the annual general meeting, I have a recollection that we had an annual general meeting. Precisely the details of that meeting I wouldn't like to say I have a clear recollection of that in the sense I can remember sitting down and doing X, Y and Z. Certainly I remember we had the annual general meeting and they are fairly short affairs and we follow through the agenda. So I am not too sure how precise a recollection you would like me to have. I mean, I can recollect - I obviously know we had an annual general meeting. A specific recollection - I think I can say I recollect we had an annual general meeting." 21 The cross-examination continued: "Q. Do you have a recollection of this particular annual general meeting to which reference is made in the minutes? A. Yes.

Q. Who do you recall being present? A. Stuart Curtis and Kevin Lieschke.

Q. And yourself, is that correct? A. And myself, yes.

Q. You will see in paragraph 4 of the minutes, 'consent to short notice'? A. Yes.

Q. Was any such consent signed? A. At this stage I have to say not that I am aware of, but it was passed and that was accepted.

Q. So there was no written consent to short notice that had been signed? A. No, there wasn't. That's been, I think - I notice that when I attended the school annual general meeting the same sort of thing happened, from recollection.

Q. You say short notice was passed as item 4 during the course of the annual general meeting; is that correct? A. Yes." 22 Mr Warren was then shown a Form 388 lodged with ASIC and accompanied by Centre's financial statements and reports for the year to 31 December 2004. The form was signed by the then secretary, Mr Barrett, and dated 24 May 2005. In the space reserved for "Date of Annual General Meeting (if any)", was inserted "26 May 2005". The form is stamped as received by ASIC on 19 September 2005. 23 Having been shown this document, Mr Warren was further cross-examined: "Q. It is not correct to say that the financial statements and reports were adopted at the annual general meeting on 7 July 2005, is it? A. I believe it is.

Q. They had already previously been adopted, hadn't they? A. Not to my recollection.

Q. Do you say that the certification of Mr Barrett is false? A. I am saying that the minutes, the accounts, to the best of my recollection, and according to an agenda sent to me, an agenda for the meeting for 2005 sent to me by Mr Barrett, and an agenda for the annual general meeting for 2005, to be held on 7 July, contained in that the point 5 on Exhibit 7, which said, 'resolve to adopt the statutory financial statements for Gosford Christian Centre for the year ended 31 December 2004'. That was sent to me by Mr Barrett on the 25th of this month - of last month, sorry. As I said, it was on the basis of that agenda that I drew up the minutes and so why this has been signed on 24/5/05, I do not know.

Q. You have no explanation; is that correct? A. I have no explanation. I go back to, Mr Barrett sent me an e-mail with the agenda saying that the financial reports for 2004 would be adopted at the annual general meeting on 7 July 2005." 24 There was then a further call for the agenda document received from Mr Barrett. Again it was not produced. The cross-examination continued: "BLAKE: Q. Do you have any recollection of any election for directors taking place at the annual general meeting, Mr Warren? A. I know we do that at every annual general meeting and it is recorded in the minutes.

Q. Can you answer the question? A. I don't have a direct recollection, other than I know it happened.

Q. Do you have a recollection of you being re-elected as chairman of Gosford Christian Centre Ltd? A. Yes.

Q. Who moved the resolution? A. I don't know who moved the resolution.

Q. There was no appointment of an auditor at this annual general meeting, was there? A. That's not shown on the minutes. It would appear not to be, no.

Q. And there was no resolution fixing any remuneration for the auditor passed at this meeting, was there? A. No.

Q. These draft minutes, Mr Warren, are purely a reconstruction, on your part, of the matters that you think should have been attended to of any annual general meeting of the centre in 2005? A. No, they are based on the agenda items that we had for that meeting and they were passed by all the directors at the annual general meeting last Thursday.

Q. Mr Warren, this relates to an annual general meeting on 7 July 2005. That could not have been passed last Thursday? A. The minutes were passed. The minutes of the meeting of 2005 were passed at the annual general meeting on Thursday.

Q. I suggest to you that you, in preparing these minutes, had no actual recollection of any annual general meeting and purely used an agenda document to prepare them? A. Well, I used the agenda document and, as I said, we know the procedure that we adopt at annual general meetings.

Q. They were a reconstruction based on the agenda document, weren't they? A. Yes.

DEMPSEY: Not produced." 25 It is also relevant to quote from the re-examination of Mr Warren: "DEMPSEY: Q. If I could please take you back in time to 2005? A. Yes.

Q. My learned friend referred to the annual general meeting of the Gosford Christian Centre Limited. Do you, of your own account, recall who attended that meeting? A. Yes.

Q. Can you tell the Court who attended that meeting? A. Myself, Kevin Lieschke and Stuart Curtis. That was 2005, wasn't it?

Q. In relation to the votes cast, are you capable of recalling how you passed any votes at that particular annual general meeting? A. Yes, we - obviously there was only three of us. We says, 'Are you all in favour of that?' It's a fairly simple procedure because there are only three and we tend not to vote until we have got a sense of--

BLAKE: I object to the word 'tend'. If he has got a recollection, he can give it.

WITNESS: A. Well, we only vote - our practice is to vote when we have a sense of we have got an agreement.

HIS HONOUR: Q. The question needs to be answered by reference to this particular meeting. A. Okay.

Q. Do you have a recollection that enables you to answer by reference to that particular meeting? A. Sorry, could you repeat the question?

DEMPSEY: Q. Do you recall how you passed votes at that particular meeting, that is the annual general meeting of the Gosford Christian Centre Limited in 2005? A. Well, by simply saying 'those in favour' or 'are we all in agreement'.

Q. Are you capable of recalling how many votes were passed in relation to the resolution to re-elect Mr Curtis? A. Yes.

Q. Can you tell the Court? A. That would be three, including myself.

Q. Can you recall how many votes were cast against the re-election? A. No votes, no votes against.

Q. In relation to Mr Lieschke, are you capable of recalling how many votes were cast in favour of re-electing Mr Lieschke? A. Three.

Q. And against? A. None." 26 One of the other persons said to have been present on the 7 July 2005 meeting, Mr Lieschke, gave affidavit evidence but was not cross-examined. He did not refer to the holding of the 2005 annual general meeting of Centre. There was no evidence from Mr Curtis, the third person said to have been present. 27 With Mr Warren's evidence as it is, and that evidence being the only evidence on the subject (apart from the Form 388), I cannot find that an annual general meeting of Centre took place on 7 July 2005 or on any other day in 2005. To the extent that the Form 388 referred to 26 May 2005 as the date of the annual general meeting, it simply cannot be relied upon since it was, it appears, signed by Mr Barrett two days earlier on 24 May 2005. The most it could conceivably be seen to do is to indicate an intention, existing at 24 May 2005, that the annual general meeting be held on 26 May 2005. There is nothing to show that any such intention, if it existed, was implemented. 28 That leaves Mr Warren's oral evidence. He began by saying (see paragraph [20] above) that he had a recollection of an annual general meeting. Before saying that, however, he paused and said, "I am pausing there because there were so many meetings". He then said, in the same answer, that he "wouldn't like to say" that he had "a clear recollection of that in the sense I can remember sitting down and doing X, Y and Z". He then said again that he recalled the annual general meeting and supported that by reference to what I took to be a common practice, that is, that "they are fairly short affairs and we follow through the agenda". He concluded by saying, "I think I can say I recollect we had an annual general meeting" [emphasis added]. 29 Later, Mr Warren again stated that he had a recollection of the particular annual general meeting (see paragraph [21] above). He professed a recollection that Mr Lieschke, Mr Curtis and he were present and that, while no written consent to short notice was signed beforehand, the short notice proposal was agreed to at the meeting, noting that "the same sort of thing happened" at other meetings. There was thus again resort to common practice. 30 Coming to the matter of election of directors, Mr Warren said, in relation to the supposed meeting of 7 July 2005, that he had "no direct recollection" of that having occurred, but "I know it happened" (see paragraph [24] above). Then, when asked whether he had a recollection of his having been re-elected as chairman, he said unequivocally, "Yes". He could not remember who moved the motion but said that everyone voted. Next, when asked about appointment of auditors, he was content to fall back on the content of the supposed agenda as a basis for his answer that it did not appear to have occurred. 31 When challenged (also at paragraph [25] above) with the proposition that the alleged minutes were purely a reconstruction of matters he thought should have been dealt with at any annual general meeting, Mr Warren denied that proposition and again said that the minutes had been prepared from the agenda document. He ultimately admitted that the minutes were a reconstruction based on the agenda document. Despite several calls, the agenda document was not produced. 32 In the course of re-examination (see paragraph [26] above), Mr Warren purported to say with some particularity what happened at the supposed meeting by way of voting upon motions for re-election of Mr Lieschke and Mr Curtis as directors. But those answers are undermined by the fact that the witness attempted on two occasions to answer questions about the particular events by referring to general practice. I cannot be at all confident that what purported to be answers about the specific occasion were not merely extrapolations from general practice or descriptions of what the witness thought would have happened if the usual course had been followed. 33 I am particularly conscious of the need, expressed by Dixon J in Briginshaw v Briginshaw (1938) 60 CLR 336 at p.361, for the trier of fact to "feel an actual persuasion of its occurrence or existence before it can be found", and that a finding of fact cannot be made "independently of any belief in its reality". 34 With the evidence in the state described, I cannot feel an actual persuasion that an annual general meeting of Centre occurred in 2005. Mr Warren's professed recollections are unreliable, given his overriding tentativeness and the fact that the matters to which he was really directing himself were procedures commonly adopted and things he admitted having reconstructed from an agenda document that was never produced, despite his having had it as recently as 27 or 28 June 2006. In those circumstances, I cannot find that decisions relevant to the constitution of the board of directors of Centre were made at any annual general meeting of Centre in the year 2005. If there was no annual general meeting in 2005, did all offices become vacant? 35 The question that next arises is as to the effect upon the tenure of directors of Centre of failure to hold an annual general meeting in 2005, resulting in articles 35 and 37 not being implemented in that year. 36 Article 35 requires retirement of "[a] director" from office "at the conclusion of the annual general meeting". This refers, clearly enough, to each and every annual general meeting. On one interpretation, there can be no retirement and hence no vacancy unless an annual general meeting takes place, since there can otherwise be no "conclusion" of the annual general meeting and therefore no occasion for retirement and the creation of the resultant vacancy. 37 Such a construction is, however, out of line with authority. The following passage in the judgment of Sargant LJ in Re Consolidated Nickel Mines Ltd [1914] 1 Ch 883 at pp.888-889 is in point: "As to the two other directors, Steel and Phillips, there is another objection. By clause 62 of the articles of association and by statute (s.49 of the Companies Act, 1862) the directors were bound to summon a general meeting of the company once in every calendar year, and article 101 provided that 'At the ordinary meeting in 1906 all the directors … shall retire from office'. No ordinary meeting was held or called in 1906 or 1907, and the liquidator's contention is that all the directors vacated office on December 31, 1906, which was the last day on which a meeting of the company for that year could have been held. That contention appears to me to be well founded. A director on his appointment does not ordinarily step into an office which is perpetual unless terminated by some act, but into an office the holding of which is limited by the terms of the articles. The meaning of article 101 is that the holding of the office of director was only to last until the end of 1906, or until the earlier date on which the ordinary meeting for that year was held." 38 This case was referred to by Needham J in Club Flotilla (Pacific Palms) Ltd v Isherwood (1987) 12 ACLR 387 in connection with a submission that a committee required to retire at the conclusion of the first annual general meeting "would continue to hold office until such time as the first annual general meeting was held and concluded, no matter how long a delay in holding that general meeting". His Honour said at p.389: "I think this submission is contrary to the line of authority which stems back over 70 years; the initial decision is that of Sargant LJ in Re Consolidated Nickel Mines Ltd [1914] 1 Ch 883, where his Lordship held that, in articles not dissimilar from the present, directors vacated their office on the last day on which a meeting of the company for that particular year could have been held. That decision has been recognised as correct by the House of Lords in Morris v Kanssen [1946] AC 459 and in a recent decision of the Chancery Division Re Zinotty Properties Ltd [1984] 3 All ER 754 at 763." 39 The House of Lords in Morris v Kanssen [1946] AC 459 did not deal with this matter at any length. In the context of provisions of generally similar import, Lord Simonds (with whom the other members agreed) merely said that neither of the persons concerned "has in any view been a director since the end of 1941", that being the deadline for the holding of the relevant general meeting. Re Consolidated Nickel Mines Ltd (above) was referred to in argument (at p.465) and it is clear that his Lordship's statement was referring to the construction preferred in that case. 40 I therefore conclude that because there was no annual general meeting of Centre in 2005, the offices of each director of Centre in office at 31 December 2005 who was required by article 35 to retire at the end of the annual general meeting held in 2005 became vacant at the end of 31 December 2005. Did Mr Warren nevertheless continue as a director? 41 I have framed the conclusion just stated by reference to each director in office on 31 December 2005 who was required by article 35 to retire at the end of the annual general meeting held in 2005. That form of expression is indicated by the possibility that one person may, quite independently of the matters so far explored, have been in office uninterruptedly at all material times. 42 Ms Dempsey drew attention to article 30(c) of Centre's constitution: "The Senior Minister shall be ex-officio a member of the Board and shall be the Board's Chairman." 43 Article 1 of the constitution defines "Senior Minister" as "the person for the time being holding the position of Senior Minister in the Gosford Christian Centre congregation". It is, as I understand it, accepted on both sides that, at all material times, Mr Warren was the Senior Minister. The effect of article 30(c) must therefore be that Mr Warren, while Senior Minister, was automatically a director of Centre without appointment or election as such - although, no doubt, subject to his consenting to hold the position, which he obviously has done and continues to do. 44 It then becomes necessary to consider the interaction between article 30(c) and articles 35, 36 and 37. The starting point is article 30(a) which states that "[t]he board shall consist of" not less than three nor more than nine "members". Article 30(b) then says that the five subscribers to the memorandum "shall constitute the first board". It goes on to provide that those five persons shall also be "the first officers", allocating a position to each. The position of chairman is allocated to P.A. O'Sullivan whose occupation is stated in the memorandum of association to be minister of religion. Then follows article 30(c) itself, and its specification to the effect that the person for the time being holding the position of Senior Minister in the Gosford Christian Centre congregation shall, by virtue of the person's office as such Senior Minister, be a "member of the Board" and "the Board's Chairman". If, as may have been the case, Mr O'Sullivan was the Senior Minister at the time of incorporation, article 30(c) may be taken to have an operation beyond merely causing the Senior Minister at the time of incorporation to be a member of the board and the board's chairman. On the assumption stated, that purpose was achieved by article 30(b) which installed Mr O'Sullivan as a director and as chairman. Article 30(c) must be taken to have some greater intended significance, particularly in light of the fact that it applies to the person "for the time being holding" the position of Senior Minister to the congregation and therefore has a continuing and ambulatory operation. 45 There are two provisions concerning periodic retirement of directors. The first is article 30(b). Dealing with the five subscribers to the memorandum as the first board, it says: "They shall all retire at the first annual general meeting but shall be eligible for re-election." 46 In addition, there is article 35 which, as already noted, provides: "A director shall retire from office at the conclusion of the annual general meeting which shall elect directors for the ensuing year." 47 Article 30(b), on its face, applied to Mr O'Sullivan and required him to retire at the first annual general meeting. He was clearly comprehended by "They" at the start of the concluding sentence of article 30(b). If, as postulated, he was, at the time, the Senior Minister, the express reference to him by name in article 30(b) would, in my view, have prevailed over the general provision in article 30(c) regarding the person holding office as Senior Minister of the congregation for the time being. 48 The interaction between article 30(b) and article 35 is, however, an interaction between two provisions of indiscriminate application, one concerning the person "for the time being" holding the position of Senior Minister of the congregation and the other concerning "A director …". 49 The clear effect of article 30(c) is that while a particular person holds the position of Senior Minister of the congregation, that person is a director, assuming that the person has actually entered into and remains willing to exercise the office of director. If, as under article 30(b), the person were by name required to retire at an annual general meeting, that requirement would have to be observed. But where, as in the case of articles 35 and 36, it is stated that "a director" must retire at the annual general meeting and is eligible for re-election, the provision causing the person to be a director by virtue of the person's office as Senior Minister must be viewed as a specific provision with respect to the directorship of the office holder and the provisions with respect to retirement and eligibility for re-election of directors at large must be regarded as general provisions. The general provisions must have an operation that is subservient to that of the specific provision. The person who is declared by article 30(c) to be a director by virtue of holding the position of Senior Minister is intended to be in office as a director throughout the person's tenure as Senior Minister; and the general requirement in article 35 takes effect subject to that expressed intention. It is the person's position as Senior Minister, not any election or appointment, that causes them to be a director. 50 I am therefore of the opinion that, although, as I have found, there was no annual general meeting of Centre in the 2005 calendar year and, as a consequence, the directors required by article 35 to retire at that annual general meeting are now no longer directors, Mr Warren, as the Senior Minister, was kept apart from that process by article 30(c) and continued to be a director ex officio by virtue of that provision. Did the constitution allow Mr Warren to act as sole director on 26 June 2006? 51 This leads to the question whether the appointment document is valid because signed by Mr Warren and despite the circumstance that, as I have found, Mr Lieschke and Mr Curtis, the other two signatories, were not directors of Centre at the time of signing. 52 Section 250D, unlike some predecessor provisions (for example, s.140(3) of the Companies Act 1961), does not specify a mode of appointment by a body corporate. The nature of the acts required is thus to be gathered, in the first instance, from Centre's constitution. Article 42(f) of the constitution reads: "Where all the Directors have signed a document containing a statement that they are in favour of a prescribed resolution in terms set out in the document, a resolution in those terms shall be deemed to have been passed at a meeting of the Directors held on the day on which the document was signed and at the time at which the document was signed by the Director last signing it. Where a document is so signed the Board shall be deemed to have held a Board meeting at that time on that day and the document shall be deemed to constitute a minute of that meeting." 53 The appointment document of 26 June 2006 is, on the basis that Mr Warren was then the only director, a document signed by "all the Directors". This is because it was signed by Mr Warren who, on the basis stated, was then the only director. According to article 1, the plural includes the singular, so that a reference to "all the directors" must be construed as a reference to the sole director where there is only one in office. But there is then the question whether it was open to Mr Warren alone to act in that way. It is necessary to quote, in that connection, articles 30(a), 43 and 44: "30. (a) The board shall consist of not less than three nor more than nine members."

"43. The quorum necessary for the transaction of the business of the directors shall be sixty percent of directors holding office.

44. The continuing directors may act notwithstanding any vacancy in their body but if and so long as their number is reduced below the number fixed by or pursuant to the regulations of the Company as the necessary quorum of directors the continuing directors may act for the purpose of increasing the number of directors to that number or of summoning a general meeting of the Company but for no other purpose." 54 When article 44 refers to "any vacancy in their body", it has in contemplation the situation where the minimum complement of directors required by the constitution has previously been in office but there is now some deficiency, in the sense that less than the minimum complement remains. This is made clear by the decision in Re Sly Spink & Co [1911] 2 Ch 430. The articles there under consideration contained a provision similar to the present article 30(a). It was in these terms: "The number of directors shall be not less than four or more than eight." 55 Neville J, after observing that four was "the minimum number of directors which can constitute a board", said (at p.436): "Below that number you cannot have any board at all." 56 The situation in that case was one in which the minimum of four directors had never been in office. That being so, it was held that an article like the present article 44, referring to "any vacancy in their body", did not apply: there could be no "vacancy in their body" unless the body had, at some time, been complete. 57 In the present case, it must be accepted that the "body" was at some time complete. This is because article 30(b), to which I have already referred, designates as the "first board" by name the five subscribers to the memorandum of association. They, having also signed the accompanying articles of association (see Companies Act 1961, ss.16(1) and 29(2)(b)), must be presumed to have duly entered into office as directors upon incorporation. It follows that if, at any time thereafter, the number of directors in office fell below the prescribed minimum of three, the situation was as contemplated by article 44. 58 Since, on my findings, Mr Warren was the only person in office as a director on 26 June 2006, it becomes necessary to determine which part of article 44 applied at that point - the part permitting the "continuing directors" to act without restriction notwithstanding the vacancy in their body; or the part allowing them to act only for the specific purpose of increasing the number of directors or summoning a general meeting. (I interpolate here that, in view of the aspect of article 1 to which I have just referred, the "continuing directors" refers to the sole continuing director where there is only one: Channel Collieries Trust Ltd v Dover St Margaret's and Martin Mill Light Railway Company [1914] 1 Ch 569.) 59 Whether it is the first or the second part of article 44 that applies depends on whether, when there is only one director, it is correct to say that "their number is reduced below the minimum fixed by or pursuant to the regulations of the Company as the necessary quorum of directors". 60 This directs attention to article 43, there being, on the evidence, no suggestion of any other quorum specification for directors. Under that provision, what article 44 calls "the necessary quorum of directors" (being, in the words of article 43 itself, "[t]he quorum necessary for the transaction of the business of the directors") is "sixty percent of directors holding office". The focus there is clearly upon the number of directors for the time being actually in office, as distinct from, for example, the minimum number required by article 30(a). That is the force of the words "holding office". 61 Because the quorum fixed by article 43 is a fraction of the number of directors actually holding office, there can never be, under the constitution as it stands, a number of directors holding office that is less than the required quorum. Furthermore, where there is one director only in office, I am satisfied that "sixty percent of directors holding office", being, as it were, three-fifths of one director, is properly regarded as one. The matter may be tested this way. Let it be assumed that the number of directors actually in office is four. Sixty percent of four is 2.4. Is the necessary quorum then two or three? In my view, it must be three. Two is less than sixty percent of four. Given that a quorum must be a whole number, the requirement would not be satisfied by the presence of two, whereas it would be amply satisfied by the presence of three. In other words, the presence of three is the minimum that is consistent with the sixty percent specification in a case where four directors are in office, given that the provision is obviously intended to identify a whole number without any fraction by way of remainder. 62 In the situation now before me, that is, where there is only one director in office, the same process of analysis produces the conclusion that the quorum requirement is one. It cannot be zero because zero, if a number, is less than sixty percent of one. Nor should the quorum provision be seen as intended to deny the ability of the organ to operate as distinct from laying down a rule as to its operation. It has been held, in relation to a provision requiring retirement of the number of directors "nearest to one-third", that, if there is only one director in office, that director must retire: see Re New Cedos Engineering Ltd [1994] 1 BCLC 797 (a case decided in December 1975). One reason for this conclusion was that zero is not a number but, rather a "cipher of no value". That, it seems to me, must be the correct approach here too, with the result that, if there is one director, a quorum consists of that director. 63 The question which then arises is whether a quorum of one is, in any event a meaningful concept, given that "quorum", in a general sense, connotes the minimum number of persons necessary for a meeting and that, in general, a meeting involves a plurality of persons. The case of Re Fireproof Doors Ltd [1916] 2 Ch 142 is extensively cited in textbooks in support of the proposition that where the directors are themselves empowered to fix their quorum, they may fix a quorum of one: see, for example, S. R. Brown, "Company Directors", second edition (1965), p.66; G. B. Parker and M. Buckley, "Buckley on the Companies Acts", fourteenth edition (1981), p.1019; H. A. Davidson, "Company Meetings", second edition (1992), p.272; G. Morse (ed), "Palmer's Company Law", (first loose-leaf edition, current February 2006) , p.8080. Just as it is sensible to speak of a committee of one, so it is meaningful to contemplate a quorum of one. The construction produced by the foregoing analysis is therefore in accordance with the terms of the constitution. 64 Any conclusion that, where only one director is in office, "the minimum fixed by or pursuant to the regulations of the Company as the necessary quorum of directors" is one raises a question about the meaning of the part of article 44 that permits the continuing directors to act "for the purpose of increasing the number of directors to that number". The reference to "that number" is obviously a reference to the necessary quorum fixed by or pursuant to the regulations of the company. But, according to the foregoing analysis based on article 43, the number of the "continuing directors" can never be smaller than the necessary quorum, at least while article 43 in its present form fixes the quorum. There can accordingly never be any possibility of "increasing" the number of directors in office to the number necessary to constitute a quorum. 65 One may speculate that the person who drafted article 44, although referring to "the number fixed by or pursuant to the regulations of the Company as the necessary quorum of directors", did not, in reality, intend to refer to the number specified in article 43. The number in contemplation may have been the minimum number specified in article 30(a). Alternatively, it might have been contemplated that precisely the position I have outlined should prevail unless and until the constitution itself was altered so as to specify a fixed number as the quorum for meetings of directors (a conceptually similar provision seems to have been considered by Hansen J in Host-Plus Pty Ltd v Australian Hotels Association [2003] VSC 145 - see paragraph [10] of the judgment). Article 44 is in exactly the same terms as regulation 84 of Table A in the Fourth Schedule to the Companies Act 1961. But the quorum provision there (regulation 83) says that the quorum necessary for the transaction of the business of the directors "may be fixed by the directors, and unless so fixed shall be two". This raises the possibility that the draftsman of Centre's articles simply adopted regulation 85 of Table A as article 44 and then formulated article 43 as a special provision without appreciating the significance of the fundamental difference between it and regulation 83. 66 These, however, are matters of pure speculation. There is no basis on which to conclude that article 44 is to be given any meaning other than that which its interaction with the clear words of article 43 produces as a matter of construction. 67 The several considerations to which I have referred compel the conclusion that, where there is only one director in office, that director alone can act for all purposes and is not confined to increasing the number of directors in office (by resort to article 38 which allows the directors to fill casual vacancies) or calling a general meeting. The conclusion is scarcely a palatable one, in that, with three fixed by s.201A(2) of the Corporations Act as the minimum permitted number of directors for a public company, the constitution may be seen to sanction a situation that the Act does not allow. At the same time, however, where a public company has less than three directors, there must be a clear expectation that, as a matter of duty, those with the power to make appointments to restore the board to the minimum permitted complement will be diligent in taking all reasonable steps to do so. 68 A combination of articles 44 and 43 produces a result that may have been unintended and is, to some extent at least, anomalous and undesirable. But the court, in construing a company constitution which is clear in its language, does not lead to any absurd result and does not lend itself to any apparently more symmetrical or more satisfactory construction, is bound to take it as it finds it. 69 For these reasons, I conclude that, as at 26 June 2006, Mr Warren, being the only person in office as a director of Centre, was permitted by Centre's constitution, to exercise any power of Centre referable to its status as a member of School. Significance of non-compliance with s.201A 70 Although, for the reasons explained, the constitution of Centre countenances the action that Mr Warren, as sole director, took to appoint himself as Centre's representative in relation to School, the implications of non-compliance with s.201A require consideration. I approach the matter, at this point, on the assumption that, consistently with submissions made on behalf of the plaintiffs, the appointment is not defective in form. That is a matter to which I shall return in due course. 71 Section 201A is in the following terms: " Minimum number of directors

(1) A proprietary company must have at least 1 director. That director must ordinarily reside in Australia.

(2) A public company must have at least 3 directors (not counting alternate directors). At least 2 directors must ordinarily reside in Australia." 72 The directive in s.201A(2) is that a public company have at least three directors. The duty or obligation imposed by the section lies upon the company. The question that arises is as to the validity of proceedings within a company that is in default under the duty or obligation, where the proceedings have ramifications beyond the internal affairs of the company. In the present case, there is an issue as to whether the purported appointment of Mr Warren as Centre's representative under s.250D in relation to School is effective so that it must be recognised and accepted by School. 73 In Whitehouse v Carlton Hotel Ltd (1987) 162 CLR 285, Brennan J (with whom Wilson J concurred on the matter and Mason, Deane and Dawson JJ expressed general agreement) was of the opinion that the analogous provision of the Companies Act 1961 was not contravened where the constitution reposed all decision making at director level in a governing director, leaving the remaining directors with only such powers, if any, as the governing director might assign to them. It was held that the statutory provision did not invalidate the provision of the constitution vesting plenary powers in the governing director. But in that case, the required number of directors was in office, even though all but one of them were essentially powerless. 74 It may perhaps be inferred from this decision that s.201A invalidates any provision of the constitution that sanctions the exercise of the powers of the directors by a board consisting of fewer directors than the statutory minimum. An assumption to that effect (or, at least, that a directorate not conforming to s.201A cannot validly act) may be found in a number of relatively recent cases where the court has considered applications for validating orders under s.1322(4)(a) in respect of proceedings conducted by boards with a deficiency of members. 75 The first such case is my decision in Re Continental Pacific Insurance Co Ltd [2002] NSWSC 789 where each of two public companies ("Continental Pacific" and "Holdings") had purportedly appointed Part 5.3A administrators in circumstances where only one director was in office and that director alone had participated in the steps to appoint administrators. I there made orders under s.1322(4)(a) having first said (at [5] to [11]): "Each of the companies is a public company, not a proprietary company. As a result, s.201A(2) requires that there be at least three directors. In addition, the constitution of each company works by reference to a clear assumption (which is not surprising in light of s.201A(2)) that the company may not have a sole director. Each constitution sets the minimum number of directors at three. In the case of Holdings, the constitution states that the quorum for a meeting of directors is two directors. In the case of Continental Pacific, the relevant provision says that a quorum is two or such greater number as is determined by the directors from time to time. In the absence of evidence of any such determination I must work on the footing that the quorum is two.

In the constitution of Continental Pacific, unlike the constitution of Holdings, there is a further provision to the effect that, if there is a vacancy in the office of a director, the remaining directors may act but, if their number is not sufficient to constitute a quorum, they may act only for the purpose of increasing the number to a number sufficient to constitute a quorum or of convening a general meeting.

When a resolution of its board was supposedly passed in accordance with s.436A, neither company had a board of the minimum size required by s.201A(2) and the one director who was in office could not, under the constitution, constitute a quorate meeting, even assuming that the particular context might be regarded as one permitting a 'meeting' of one. (I note here that s.436A does not, in terms, require a meeting - it only requires a resolution and, as the Act itself recognises in, for example, Division 1 of Part 2G.2, there can be a resolution without a meeting.) In the case of Continental Pacific, there is the further point that the constitution expressly limited the capability of the single director to increasing the number of directors to the minimum of three or convening a general meeting.

But this case is distinguishable from other cases of lack of quorum in that the totality of the directorate, in the person of the sole director, assented to the proposed resolution. It is not as if there were directors capable of attending who did not attend, or that proceedings took place in the absence of directors whose participation might have had some bearing on the outcome.

There is, I think, some uncertainty as to the consequences of failure to comply with s.201A(2). As has been pointed out in other cases (recently reviewed by Windeyer J in DVT Holdings Ltd v Bishop.com.au Ltd (2002) 42 ACSR 378), a company may fall into the position of having too few directors without any action on its part. This can, for example, happen where several directors resign or are removed at the one time. The company, as a person, has no control over these events and it cannot be intended that s.201A denies or controls an individual's right to resign or the corporators' right to remove. It is, for me, difficult to accept that a company contravenes s.201A(2) when the number of its directors falls below the statutory minimum. If that were the correct approach, a proprietary company with one director would, by operation of s.1311(1)(c), become guilty of an offence upon the death of that single director.

Despite this unease, I must accept the possibility that a contravention of s.201A(2) occurs if the number of the directors falls below the stated minimum for any reason. The need to recognise the possibility arises from observations of Cohen J in Corpique (No 20) Pty Ltd v Eastcourt Ltd (1989) 15 ACLR 586 and the comment by Windeyer J in DVT Holdings (above) that: 'It is an offence for a public company to have fewer than three directors.'

I therefore approach Mr Palmer's applications for curative orders on the basis, first, that at the time of the purported passing of the resolution of the kind referred to in s.436A, there existed a contravention of the Corporations Act in relation to each company in that the number of the directors was less than the number required by s.201A(2) and, second, that the action of the sole director in purporting to pass the resolution was in contravention of the constitution because its provisions did not allow a single director to pass such a resolution." 76 Subsequently, in Re Ausam Resources Ltd [2004] FCA 823, French J entertained an application under s.1322(4) in a situation where resolutions had been passed by a board of directors which, while consisting of the minimum of three directors required by s.201A(2), did not include at least two directors ordinarily resident in Australia as specified in that section. His Honour proceeded to address the s.1322(6) criteria. 77 The third case to which reference should be made is Re Colorbus Pty Ltd; Mentha v Colorbus Pty Ltd (2004) 57 ACSR 677, a decision of Mandie J. That was also a case in which a sole director purported to appoint voluntary administrators. The company was a proprietary company, so that s.201A(1) applied. There was one director, but that director was not (either at the time of the proceedings or at the time of the relevant activities) ordinarily resident in Australia. Indeed, it appeared that the person had not been resident in Australia at the time of appointment, so that the situation of non-compliance with s.201A had existed since inception. Mandie J described the consequences as follows (at [21]: "In my opinion the mandatory obligation or requirement contained in s 201A(1) operates so that the appointment of a person as a director of a proprietary company, who does not at the time of the appointment ordinarily reside in Australia, is 'invalid' or irregular, if the company does not at that time have a resident director. The appointment of Mr Kintsch as a director, although invalid in that sense, was not in my view a nullity. The invalidity might have been cured by Mr Kintsch commencing to ordinarily reside in Australia. It might also have been cured by the appointment as an additional director of a person who ordinarily resided in Australia. These events of course did not occur and Mr Kintsch's appointment was invalid and remained so." 78 Mandie J went on to hold that s.201M rendered effective the relevant act of the sole director in appointing voluntary administrators. His Honour then proceeded to consider, in the alternative, the applicability of s.1322(4) in relation to the appointment of administrators and, in so doing, accepted that the case was within the reach of that section. 79 I am satisfied that the situation now before me involving Mr Warren, while going beyond the kind of "procedural irregularity" contemplated s.1322(2), is capable of being validated under s.1322(4). This is not a case where there was no action. It is a case where three persons purported to act as a full board of directors; two of them, as has now been found, were not directors; the third was permitted by the constitution to do what he joined with the other two in doing; and the contravention of the Act was a consequence of those two not being validly in office as directors and the third alone acting as the constitution allowed him to act. Those circumstances are within the contemplation of s.1322(4)(a). 80 Turning to the criteria in s.1322(6), it seems to me that lack of honesty can in no way be attributed to Mr Warren or, for that matter, to Mr Lieschke and Mr Curtis. Those three persons are, in terms of s.1322(6)(a)(i), the only persons who could be within the description "the person or persons concerned in or party to the contravention or failure". Each acted, in the matter of the purported appointment under s.250D, in a straightforward way. I am satisfied that they "acted honestly" as referred to in s.1322(6)(a)(i). Given the disjunctive nature of the three criteria in s.1322(6)(a) (where a semi-colon alone separates (i) and (ii) but a semi-colon and the word "or" separate (ii) and (iii)), that finding is of itself sufficient to satisfy s.1322(6)(a). 81 The other question posed by s.1322(6) is whether "substantial injustice" has been or is likely to be caused to any person. Of necessity, that question relates to the impact of the defective process itself: did "substantial injustice" arise from the purported appointment of Mr Warren as Centre's representative empowered to exercise powers of the s.250D(1) kind exercisable by Centre in relation to School? 82 Submissions were made on behalf of the defendants (related to the applicability of s.1322(2) on a wider front) to the effect that "substantial injustice" arose from the alteration of School's constitution and the reconstitution of its board of directors, assuming them to be effective. There were references to the possibility that the tax deductibility of gifts to School's building and library funds might be jeopardised and that difficulties might arise in relation to bank financing. I do not consider those matters to be relevant to the question whether "substantial injustice" was occasioned by the purported appointment of Mr Warren as Centre's s.250D representative in relation to School. The question is whether "substantial injustice" arose from the circumstance that Centre purported to vest s.250D powers in a natural person, not whether "substantial injustice" arose more remotely from what that natural person did in exercise of the powers: Re Broadway Motors Holdings Pty Ltd (1986) 6 NSWLR 45 at p.58; Re Pembury Pty Ltd [1993] 1 QdR 125 at p.127; Poliwka v Heven Holdings Pty Ltd (1992) 7 ACSR 85 at pp.97-98; Mamouney v Soliman (1992) 9 ACSR 63 at p.71; Sutherland v Robert Bosch (Aust) Pty Ltd (2000) 33 ACSR 680 at p.690; Twin v Deputy Commissioner of Taxation [2004] 1 QdR 450 at pp.457-458. 83 School could not be prejudiced merely because Centre chose to appoint a natural person as its representative under s.450D. Neither the appointment nor its validation has occasioned or will occasion "substantial injustice" to anyone. An order under s.1322(4)(a) may therefore appropriately be made. The form of the appointment document 84 I consider next the contention of the defendants that the appointment document does not satisfy the form requirements of s.250D. In addressing that matter, I observe at the outset that Centre is a "body corporate", as contemplated by s.250D(1). It acquired that character by force of s.16(4) of the Companies Act 1961 upon its incorporation. 85 The defendants say that the form of words used in the appointment document - "appoint Maxwell Warren as the representative of GCCL to Gosford Christian School Limited pursuant to section 250D of the Corporations Act 2001 (Cth)" - did not attract the operation of s.250D so as to cause the named appointee to be empowered in the way described in s.250D(4). 86 Mr Blake SC submitted on behalf of the defendants that an appointment under s.250D must specify the powers to be exercised by the representative, being some or all of the powers stated in paragraphs (a) to (d) of s.250D(1). It is insufficient (and ineffective), in Mr Blake's submission, for a purported appointment to be "as representative … to" the relevant company, since this specifies no powers. 87 I do not accept that submission. Read together, ss.250D(1) and 250D(4) make it clear that an instrument of appointment may do one of two things. First, it may entrust to the appointee the totality of the powers of the specified kind, that is, all powers that the appointor body corporate may exercise at meetings of the company's members, all powers that it may exercise at meetings of the company's creditors or debenture holders, all powers that it may exercise in relation to resolutions of the company to be passed without meetings, and all powers that it may exercise in the capacity as a proxy appointed under s.249X(1). Alternatively and as s.250D(4) makes clear, it may entrust to the appointee some only of those powers. 88 Where a body corporate appoints a person "as" its representative "to" a named company "pursuant to section 250D of the Corporations Act 2001 (Cth)", there is obviously no explicit delineation of powers. But there is unmistakeably an appointment as representative. Because particular powers are not specified, the unambiguous and unqualified constitution of the appointee as representative "to" the company "pursuant to" s.250D must activate that part of s.250D(4) which causes the representative to be able to exercise "all of the powers that the body corporate could exercise at a meeting or in voting on a resolution", that is, the whole of the powers referred to in s.250D(1). In the absence of words of limitation, an appointment expressed to be made pursuant to the section can only be construed as intended to take the fullest possible advantage of the section. 89 I am satisfied that, if Centre was on 26 June 2006, a member of School, the appointment document was valid and effective to cause Mr Warren to be capable of exercising, on Centre's behalf, all powers that Centre could exercise in relation to resolutions of members of School to be passed without meetings, being a power contemplated by s.250D(1)(c). But did Centre possess voting power in relation to School? 90 The power of Centre relating to resolutions of members of School that Mr Warren purported to exercise as representative of Centre is the power that the sole member of a company has under s.249B to cause a resolution to be passed. The power is exercised by the sole member's signing a record of the resolution. The capacity of a s.250D representative to exercise the power for a body corporate which is sole member is mentioned in Note 1 to s.249B. 91 An essential pre-requisite to the validity of the resolutions supposedly passed by Mr Warren's signing of the special resolution document and the ordinary resolution document is that Centre was, on 26 June 2006, the sole member of School. It is to that matter that I now turn. 92 The register of members of School is not in evidence. There is, however, in the annexures to Mr Warren's affidavit of 28 June 2006, documentary evidence that, in connection with the formation and registration of School, Centre, as "the initial member of Gosford Christian School Limited", agreed to the constitution, consented to become a member and agreed to pay the sum of $10.00 as set out in clause 10 of the constitution. I infer from this that Centre consented to be a member of School in advance of, and for the purposes of, the registration of School (s.117(2)(c)) and became a member on registration by force of s.120(1). An ASIC extract in evidence shows the date of registration of School as 1 September 2004. I am satisfied that Centre was the sole member of School on that date. 93 It is relevant to refer next to certain matters appearing from the audited financial statements of School for the year ended 31 December 2005, a copy of which is in evidence as an annexure to Mr Totonjian's affidavit. Note 17 to the accounts states that there was one member of School at 31 December 2005. Note 21 identifies the ultimate parent entity at that date as Centre. 94 These indications that Centre continued as the sole member of School are confirmed by a number of internal School documents. Minutes of a meeting of directors of School on 3 November 2005 referred to "Member" in terms obviously identifying Centre. The agenda for a meeting of School's board on 8 June 2006 likewise refers to "Member" in terms clearly identifying Centre. There are equivalent references in minutes of board meetings held on 30 May 2006, 8 June 2006 and 22 June 2006. 95 Taken as a whole, the evidence shows that Centre continued to be the sole member of School up to 26 June 2006, subject to an important matter which I must now consider. 96 It was submitted by Mr Blake SC on behalf of the defendants that, by virtue of a positive act of Centre, the membership of Centre ceased on 3 November 2005. He points to a letter of that date sent by Mr Warren, on behalf of Centre, to Mr Totonjian, the first defendant, as chairman of the board of School. Mr Warren emailed to Mr Totonjian on that day what he described as "a letter from the directors of GCC to be presented to the Board tonight". The reference to "the Board" is, clearly enough, a reference to the board of School and it must be accepted that the letter was a communication by Centre to School. 97 The defendants contend that Centre, by communicating to School the content of the letter of 3 November 2005, ceased to be a member of School. The contention is based on clause 13 of School's constitution: "Any member may by notice to the Secretary resign as a member with immediate effect or with effect from a particular date subsequent to, but not being later than six months from, the date of that notice." 98 The letter of 3 November 2005 runs to almost four pages. It refers in some detail to differences that had arisen between Centre and School. The first few paragraphs refer to a meeting on the preceding Tuesday at which the differences were discussed. Then follows this passage: "As stated at the meeting the member sees it has two possible responses; 1. To dismiss the Board. This would effectively kill the school and it is not a position GCC would want to take. 2. To accept that since GCSL no longer wants to be part of the ministry of GCC to cease being the member and release GCSL to either stand on its own or to find another member. With sadness we choose option 2. This being the case we now have to make one final decision - the purchase by GSCL of the land. This process will need to be worked through by both companies, who whilst looking after their own interests must be aware of the interests of the other. This means that both will have to be willing to compromise to make this succeed." 99 Later, under a sub-heading "Very Important Statement", appears the following: "Should the Board choose to revisit the situation (i.e. points A. and B. above as understood by Kevin and confirmed by Simon) we would be quite happy to do so but if not please understand that in the absence of a further direction from God we will release the school to choose its own path. I would ask the Board to read and carefully consider the post scrip to this letter." 100 At the conclusion of a long postscript is the following passage: "As stated above we all need to move forward and GCC will not stand in the way of GCSL going its own way. May you have wisdom, grace and insight as you deliberate and decide the future for Gosford Christian School." 101 It was submitted on behalf of the defendants that the words, "With sadness we choose option 2", coupled with the description of a particular course of action in the immediately preceding item 2, caused the letter of 3 November 2005 to be a notice in terms of clause 13 of School's constitution. 102 I do not consider that to be correct. Even leaving to one side the technical point that the letter was not addressed to the secretary of School as required by clause 13, its content was not as contemplated by that clause. The second of the "two possible responses" Centre saw as available to it was: "To accept that since GCSL no longer wants to be part of the ministry of GCC to cease being the member and release GCSL to either stand on its own or to find another member." 103 The letter then said that Centre chose this second of the "two possible responses" ("With sadness we choose option 2"). What was thus chosen was "[t]o accept … to cease being the member …". The thing chosen was acceptance of a concept - that is, that Centre should cease being the member and allow School to go its own way. But the letter went on to make it clear that the connection between the two entities remained, although on the footing that its end was in contemplation. The quoted passage from the "Very Important Statement" invited the board of School "to revisit the situation" and expressed a willingness of Centre to do likewise. That passage then went on to address the possibility that the board of School might not "revisit the situation" ("but if not …"). In that event, Centre indicated, it would take a particular course "in the absence of a further direction from God". The course thus foreshadowed was "release" of School to "choose its own path". The idea that Centre saw any separation as lying in the future was reinforced by the passage at the end of the postscript: "…GCC will not stand in the way of GCSL going its own way". 104 This letter was not, in terms of School's constitution, a notice of resignation as member either "with immediate effect" or "with effect from a particular date subsequent to, but not later than six months from, the date of that notice". The letter conveyed the message that Centre had decided that, as between the possibility of dismissing School's board and the possibility of relinquishing its membership of School, the latter was in concept adopted and the former was in concept rejected. What the letter notified was that decision as to a future course of action; but part of what was notified was the qualification that there would be relinquishment of membership if neither a revisiting of "the situation" by School's board nor "a further direction from God" was forthcoming, with School, as it were, left with the task of considering whether some solution might be found that would deflect Centre from its chosen policy of future resignation. 105 I am satisfied that delivery by Centre to School of the letter of 3 November 2005 did not cause Centre's membership of School to cease pursuant to clause 13 of School's constitution. It is therefore unnecessary to address the question whether clause 13 of School's constitution could be given such an operation as to allow School to have no members at all.

The sequence of the documents 106 I pause at this point to observe that, in view of my findings regarding Mr Warren's tenure as a director of Centre, the capacity of a sole director under Centre's articles, the availability of validation under s.1322(4)(a), the continuity of Centre's status as a member of School at 26 June 2006 and the construction of s.250D, the appointment document must be accepted as having caused Mr Warren to be able to exercise all of the powers that Centre, as a member of School, could exercise in relation to resolutions of School to be passed without meetings. I am referring, of course, to the powers referred to in s.250D(1)(c). It is true that the appointment document dated 26 June 2006 was signed by Mr Lieschke and Mr Curtis in addition to Mr Warren and that, on my findings, they were not directors of Centre on that day. But that in no way detracts from the force that the document was given through the signature of Mr Warren who, on my findings, was the sole director of Centre on the relevant day and was empowered by its articles to act. The signatures of Mr Lieschke and Mr Curtis may be regarded as mere surplusage. 107 Mr Blake SC pointed out that there is no evidence as to the order or sequence in which the three documents - the appointment document, the special resolution document and the ordinary resolution document - were in fact signed. He emphasised the fundamental importance of sequence: the ordinary resolution document (concerned with steps made available by the new clauses 85A, 85B, 85C and 85D of School's constitution) could have had no force or effect unless and until clauses 85A, 85B, 85C and 85D formed part of School's constitution or, of course, unless and until the signatory, Mr Warren, had via s.250D the capacity to act for Centre under s.249B; clauses 85A, 85B, 85C and 85D would not have formed part of School's constitution unless and until a special resolution altering the constitution by inserting those provisions had been passed; and that position would not have prevailed unless and until the special resolution document had been signed following Mr Warren's achieving that capacity to act for Centre under s.249B. In short, the efficacy of the steps taken depends on the following order of signing of documents: first, the appointment document; second, the special resolution document; and, third, the ordinary resolution document. 108 In Mr Blake's submission, failure of the plaintiffs to prove that signing of the documents occurred in the necessary order means that an element essential to proof of the plaintiffs' case is lacking. 109 The sequence here in question is a sequence of acts performed by one person, Mr Warren. On the face of the documents themselves, it may be accepted that all three were signed on the same day. Answers given by Mr Warren in cross-examination regarding an e-mail sent by him to Mr Leischke and Mr Curtis at 8.28 am on 26 June 2006 were consistent with all documents necessary to the accomplishment of the plan to reconstitute School's board having been signed on that day, the date each bears. 110 As the sole effective signatory, Mr Warren must be presumed to have intended the three documents to have the force they were obviously designed to have. His intention was that each should have effect according to its terms; and it was a series of acts on his part alone that was necessary to produce that outcome. He is shown to have performed all of the necessary acts, in that his signature appears on each of the three documents. The gap in the evidence as to the sequence in which the documents were signed may be filled by resort to the presumption of regularity, omnia praesumuntur rite esse acta. The relevant principle was succinctly stated by Lindley LJ in Harris v Knight (1890) 15 PD 170 at pp.179-180: "The maxim, 'Omnia praesumuntur rite esse acta,' is an expression, in a short form, of a reasonable probability, and of the propriety in point of law of acting on such probability. The maxim expresses an inference which may reasonably be drawn when an intention to do some formal act is established; when the evidence is consistent with that intention having been carried in effect in a proper way; but when the actual observance of all due formalities can only be inferred as a matter of probability. The maxim is not wanted where such observance is proved, nor has it any place where such observance is disproved. The maxim only comes into operation where there is no proof one way or the other; but where it is more probable that what was intended to be done was done as it ought to have been done to render it valid; rather than that it was done in some other manner which would defeat the intention proved to exist, and would render what is proved to have been done of no effect."

(See also Carpenter v Carpenter Grazing Co Pty Ltd (1987) 5 ACLC 506 at p.514.) 111 The rule described by Lindley LJ applies here. I accordingly infer, as a matter of probability (which is all I need find), that Mr Warren signed the documents in the order necessary to give efficacy to his actions, that is, that he signed the appointment document, followed by the special resolution document, followed by the ordinary resolution document. Efficacy of the special resolution document 112 I come now to a series of submissions as to the validity of the special resolution supposedly passed by means of the signing of the special resolution document by Mr Warren in exercise of the power exercisable by Centre in relation to School as referred to in s.250D(1)(c). 113 Mr Blake SC referred to clause 84 of School's constitution: "No addition, alteration or omission may be made to or from this Constitution unless the same are approved by special resolution of the members of the Company." 114 Reference was also made to the fact that, under clause 6 of School's constitution, an expression used in the constitution has the same meaning as in that part of the Corporations Act which deals with the same subject matter. The reference to "special resolution" in clause 84 must therefore by a reference to a "special resolution" within the meaning of the Act. That being so and since special resolution is the means prescribed by the Act for modifying or repealing a company's constitution (see s.136(2)), it is not, in my view, possible to regard clause 85 as imposing what s.136(3) of the Act calls "a further requirement" (cf. Hillig v Darkinjung Pty Ltd [2006] NSWSC 594). Clause 85 must be regarded as no more than an acknowledgment of the statutory means of altering the constitution. It is not possible for a company's constitution to create some mechanism for its own alteration separate from the statutory method: Ayre v Skelsey's Cement Co (1904) 21 TLR 464. 115 Mr Blake SC referred in submissions to the requirement under ss.249J and 249K that notice of a meeting of a company's members be given to each member entitled to vote at the meeting, to each director and to the company's auditor. He also referred to s.249V, which gives the auditor both a right to attend any general meeting of the company and a right to be heard at the meeting on any part of the business of the meeting that "concerns the auditor in their capacity as auditor". (I interpolate that, in the case of a listed company's annual general meeting, the auditor is compelled to attend: s.250RA). 116 From that base, Mr Blake advanced an argument as follows: while s.249B allows a company having only one member to pass a resolution by the member recording the resolution and signing the record, that procedure is not available if the Corporations Act requires or contemplates that the resolution is to be passed at a meeting; and where the directors or auditors (or both) have an interest in the proposed resolution, their right to be given notice of a meeting (and, in the case of the auditor, the right under s.249V to attend and to be heard) indicates that a meeting must be held, with the result that the s.249B procedure is not available. 117 The effect of the supposed special resolution in this case, if valid, was to create a mechanism for the removal of directors by members that did not provide for directors proposed for removal the safeguards conferred by s.203D, being safeguards that were implicitly recognised by clause 51(i) of the constitution (which provided, in effect, that a director should cease to hold office if removed pursuant to the Corporations Act). The safeguards are spelled out in ss.203D(2), 203D(3), 203D(4) and 203D(5). They ensure that the director concerned has adequate opportunity to put his or her case to members, both before and at the meeting. The proposal to provide a means of removing directors which did not embody these safeguards therefore directly impinged upon the interests of directors. This, it was argued, caused to be emphasised the directors' rights to receive notice of the meeting. Likewise, the proposed repeal of clause 70(b) requiring accounts to be audited was said to bring to the fore the auditor's right to receive notice of the meeting, to attend and to speak. 118 It follows, in Mr Blake's submission, that the special resolution purportedly passed by means of the signing of the special resolution document could only properly and validly be passed at a meeting of members in relation to which the rights of the directors and the auditors were exercisable. 119 These submissions were made in response to Ms Dempsey's contention that the paper-based procedure in s.249B was available to be used to alter the constitution of School and that there was no need for a meeting to be held. She based that submission on the following passage in my judgment in CIC Insurance Ltd v Hannan Pty Ltd (2001) 38 ACSR 245 at p.246: "A special resolution is defined by s.9 as a resolution of which certain notice has been given and which has been passed by at least 75% of the votes cast by members entitled to vote on the resolution. In former times the holding of a meeting was an essential ingredient in the passing of a special resolution, and in that respect reference may be made to the decision of Lehane J in Sipad Holding ddpo v Popovic (1995) 61 FCR 205 ; 18 ACSR 436. But modifications to the Corporations Law, in the context where one member companies are now allowed without restriction, provide for simple paper-based processes. In particular, s 249B(1) provides that a company that has only one member may pass a resolution by the member recording it and signing the record. It may be that there are instances where s 249B(1) cannot be employed to cause a resolution of a single member company to be passed. I have in mind cases where the Corporations Law itself imposes some special requirement (over and above a lodgment requirement of the kind dealt with by s 249B(2)) which relates to a meeting, thereby indicating that a meeting is an essential element. Examples are s 203D(4)(b) which gives a right to speak to the motion at the meeting and s 497(1) which makes it necessary to be able to identify the day on which the meeting is to be held. In cases of this kind, it may be that a meeting as such is made a necessary part of the statutory machinery (cf Re Montana Frocks Pty Ltd [1967] 2 NSWR 584) so that, in the case of a company having one member, the provision must be taken to be one in relation to which the normal meaning of "meeting" as a plurality of persons is displaced and the legislature countenances (indeed requires) a meeting of one: Re Hastings Deering Pty Ltd (1985) 9 ACLR 755." 120 Mr Blake argued that this case, as regards the special resolution document, is within the latter part of this extract and that the Act itself shows an intention that a meeting actually occur, thus displacing the availability of s.249B. He relied on the statutory indications concerning directors and auditors as warranting that conclusion. In his submission, the purported special resolution was invalid and the foundation essential to the effectiveness of the ordinary resolution document and the removal of directors and new appointments it purported to make was accordingly lacking. 121 The position of directors and the position of auditors should be considered separately. Dealing with directors, the Corporations Act confers, as a general matter, no more than a right to be given notice of a meeting of members. There is no express statutory right to attend or to speak, except as part of the safeguards made available by s.203D where the meeting is to consider a proposal for removal of a director pursuant to that section. A right for directors to attend and speak is, to some extent, implied in relation to an annual general meeting by s.250S and, in the case of a listed company, by s.250SA. Section 250S requires that the members as a whole be given at an annual general meeting a reasonable opportunity to ask questions about or make comments on "the management of the company" - a matter which, under most constitutions, is confided to the directors. Section 250SA makes a corresponding provision in relation to the remuneration report of a listed company, being the part of the directors' report required by s.300A(1)). But any statutorily implied right of directors to attend and to be heard cannot extend beyond the narrow matters upon which the members as a whole are given a statutory right to ask questions. 122 It follows, in my view, that the Corporations Act does not show any intention that the directors are to be afforded an opportunity to attend (or to attend and speak) at any general meeting the business of which includes matters affecting the directors' interests - such as, for example, a proposed modification that will make a director's tenure less secure or facilitate removal of directors or change directors' remuneration. The same is true of any individual director. Inclusion in the Act of specific provisions expressly contemplating the making of representations by directors on particular matters at meetings of members, as well as provisions contemplating questions on particular matters within the directors' province at meetings of members, must be taken to indicate that there is no wider and more general statutory intention regarding attendance and speaking by directors. 123 Where, as in the present case, a special resolution is proposed which will create within the constitution a mechanism for removal of directors that does not embody safeguards for affected directors of the s.205D kind, there does not arise any statutory right for directors to attend and speak at a meeting convened to consider the proposed special resolution. Nor does a director's right under s.249J to be given notice of a general meeting carry with it some right that ensures that a meeting will be convened in a case where the particular objective can be achieved perfectly well without a meeting. The s.249J right is no more than a right to be given notice of a meeting in those cases where a meeting is to be convened. 124 The auditor, by contrast, is given by s.249V a statutory right to attend a general meeting and a statutory right to be heard on any part of the business "that concerns the auditor in their capacity as auditor". This may well mean that where any such matter arises for decision by the membership, the paper-based procedures under s.249B is not available. It was submitted on behalf of the defendants that the repeal of clause 70(b) of the constitution of School requiring that annual accounts be audited was a matter that concerned School's auditors in their capacity as auditors, with the result that a right of the auditors to attend and speak at a meeting of members was activated and the repeal could not be effected by a paper-based determination under s.249B as distinct from by a resolution passed at a meeting of members - albeit, in the particular circumstances, a meeting of the sole member. 125 I am not satisfied that repeal of clause 70(d) of School's constitution is a matter that could be said to have concerned School's auditors in their capacity as auditors. The requirement that a public company have an auditor is imposed by s.327A and related provisions of the Corporations Act. School, being a company that is not a small proprietary company, must, in conformity with s.301, have its financial report for each financial year audited in accordance with Division 3 of Part 2M.3 and obtain an auditor's report. Section 331 makes the reasonable fees and expenses of an auditor payable by the company. All these statutory provisions apply regardless of the content of the constitution. Removal of clause 70(b) did not affect the tenure, duties or rights of School's auditors. Nor did it alter the audit regime to which School was subject. Repeal of clause 70(b) was therefore not, in any sense, a matter that concerned the auditors in their capacity as auditors. Vindication and observance of the auditors' s.249V rights accordingly did not require the holding of a meeting at which the right to attend and the right to speak might be exercised by School's auditors in relation to the proposed repeal of clause 70(d). 126 In summary, therefore, the Corporations Act did not impose or imply any requirement that any of the matters sought to be effected in relation to School by the special resolution document dated 26 June 2006 should be effected only at a meeting of the members of School. In accordance with the quoted extract from the judgment in CIC Insurance Ltd v Hannan Pty Ltd (above), it was open to Centre, as the sole member of School, to cause the relevant special resolution of School to be passed by means of the procedure made available by s.249B, without any meeting being held. 127 It follows from this and my earlier findings that the special resolution document was effective to modify the constitution of School in the ways there set out.

The ordinary resolution document 128 I record, for the sake of completeness, my opinion that, in light of the form the constitution of School assumed as a result of the special resolution document, it was open to Centre, as the sole member of School, to remove directors of School and elect new directors of School by means of the procedures in that respect provided for in the amended constitution. Those procedures were available despite the existence in the Act of the removal mechanisms provided for in s.203D: see Holmes v Life Funds of Australia Ltd [1971] 1 NSWLR 860, Link Agricultural Pty Ltd v Shanahan [1999] 1 VR 466, Dick v Comvergent Telecommunications Ltd (2000) 34 ACSR 86, Allied Mining & Processing Ltd v Boldbow (2002) 26 WAR 355. The fact that resolution 3 in the ordinary resolution document elected six persons together as directors raises no issue under s.201E, since that section applies only to "a resolution passed at a general meeting of a public company". Here, there was no meeting and no requirement that a meeting be held. 129 I am accordingly of the opinion that the ordinary resolution document was effective to cause the defendants to be removed as directors of School. Conclusion 130 Subject to one matter, the plaintiffs are entitled to the injunctive relief they seek directed towards restraining each of the first, second and third defendants from acting as a director of School, and the cross-claim must be dismissed. 131 I have indicated at paragraph [83] above that an order under s.1322(4)(a) of the Corporations Act may appropriately be made in respect of Centre's non-compliance with s.201A. But while the plaintiffs, in their defence to cross-claim, raised the general issue of s.1322 (by way of specific reference to s.1322(2)) and submissions on both sides canvassed the question of validation under that section, there is no actual claim for s.1322(4)(a) relief. That section permits a validating order to be made "on application by any interested person". Under s.63 of the Supreme Court Act 1970 and rule 36.1 of the Uniform Civil Procedure Rules 2005, the court should grant all such remedies as are necessary to determine all matters in controversy, whether or not a specific claim is included in any originating process. Where, as here, there is a statutory requirement for a specific application, the court should, before taking the course indicated by s.63 and rule 36.1, require an application to be filed and defer making orders until it has been forthcoming. 132 Subject to the plaintiffs filing an application to amend in accordance with paragraph [131] of these reasons, the court will grant that application and make the following orders: 1. Declare pursuant to s.1322(4)(a) of the Corporations Act 2001 (Cth) that the purported appointment on 26 June 2006 of Maxwell Warren by the second plaintiff pursuant to s.250D of that Act as representative in relation to the first plaintiff is not invalid by reason of any contravention of s.201A(2) of that Act. 2. Order that each of the first, second and third defendants be restrained from purporting to act as a director of the first plaintiff. 3. Order that the cross-claim be dismissed. 133 I will hear submissions on any further orders that should be made in response to paragraphs 2 and following of the originating process. It may be that, in light of the principal findings, the parties can reach a consensus on those matters. 134 As to costs, I am disposed to think that there should be an order that the defendants pay the plaintiffs' costs but I will hear submissions on costs if the defendants indicate that they wish to contend for the making of some other order. **********

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