Lianos v Order of AHEPA NSW Inc

Court of Appeal (NSW)|2021-02-26|Before: Macfarlan JA, Meagher JA, Black J, Commission J

Introduction On 26 November 2020, for reasons published on 26 August 2020 [1] (the Principal Reasons) and on 26 November 2020 [2] (the Supplementary Reasons), the Court made orders in relation to this appeal (the November Orders). By amended notice of motion dated 14 December 2020 (the Reopening Application), the Court has now been asked, in effect, to withdraw the Principal Reasons and the Supplementary Reasons, set aside the November Orders and reopen the hearing of the appeal. In these reasons, terms will be used as defined in the Principal Reasons and the Supplementary Reasons.

The primary question in the appeal concerned the validity of resolutions adopting a new constitution of the Association purportedly passed at the November 2018 Meeting. [3] That question depended upon the construction and effect of provisions concerning membership contained in the 2018 Rules of the Association. Two principal issues arose in relation to construction. The first issue concerned the meaning of the phrase "the unincorporated association" in the 2018 Rules of the Association. The second was whether certain rules in the 2018 Rules of the Association were cumulative as to prerequisites for eligibility for membership rather than providing separate, alternative prerequisites for eligibility for membership. The Dissenting Members contended that references to "the unincorporated association" should be understood as references to the New South Wales Chapters of AHEPA Australia. They also contended that the prerequisites for membership described in the 2018 Rules are cumulative, such that all prerequisites must be satisfied. The Court accepted the contentions of the Dissenting Members in relation to both of those issues. The consequence was that certain persons purportedly admitted as members of the Association were not in truth members of the Association and resolutions purportedly passed at the November 2018 Meeting attended by those persons were invalid. [4]

The Reopening Application

By the November Orders, the Court, relevantly, made declarations concerning the construction of the 2018 Rules of the Association as to the prerequisites for becoming a member of the Association and consequential declarations and orders concerning the effect of resolutions purportedly passed at meetings of members of the Association. By the Reopening Application, the Court is asked to set aside the November Orders, order the joinder of the Applicants as additional parties and reopen the hearing of the appeal.
The Court has now considered the written submissions filed on behalf of the Applicants and the Dissenting Members and has heard oral argument from them. The Association was the active plaintiff at first instance and fully contested the appeal in this Court. However, it has played no active role in relation to the Reopening Application other than to be represented by its solicitor, who did no more than inform the Court that the Association adopted the submissions of the Applicants.
The Applicants seek to reopen the appeal because of what they characterise as "the significant structural consequences" that the November Orders would have on AHEPA Australia Limited and the Association. They assert that the construction adopted by this Court is inconsistent with the manner in which the Applicants and various bodies have conducted themselves in the past and has the effect of imposing a "constraining, hierarchical structure" on the Applicants and their members that did not previously exist. They assert that the construction given to the 2018 Rules of the Association is contrary to the Applicants' own constitutions, which make no reference to any association and do not recognise any relationship with AHEPA Australia Limited or its predecessors.
The Reopening Application is based on the following grounds: 1. the Court proceeded on a misapprehension as to the facts, in that, on the construction of the Rules of the Association adopted by the Court, the Rules of the Association will in practice operate so that there are no members of the Association; 2. the Court misapprehended the membership of AHEPA Australia Limited, which does not include the Applicants; 3. the following matters call for review of the November Orders: 1. the November Orders would disenfranchise the Applicants and in excess of 79% of persons claiming to be members of the Association; 2. the Applicants did not know of or consent to any resolution to change the status of an unincorporated association to AHEPA Australia Limited; 3. the Applicants have been denied provision of a copy of the Constitution of AHEPA Australia Limited and resolutions of meetings of AHEPA Australia Limited and were not notified of the change of the Constitution of AHEPA Australia; 4. significant uncertainty remains as to who is entitled to vote at any meeting of the Association; 5. the November Orders impact upon "the AHEPA movement in other States in Australia", who were not joined as parties to the proceedings and did not have a right to be heard; 6. the Applicants and other interested parties have not had the opportunity to put before this Court evidence that, on its face, establishes that the "unincorporated association" referred to in the Rules of the Association is the Association prior to its incorporation under the 1984 Associations Act, which does not of itself have a hierarchy as a matter of fact and historical practice. 1. the November Orders were based only on matters argued by the parties to the appeal and persons who are affected by the November Orders were not parties to the appeal and did not have the opportunity to be heard on the appeal.
The Applicants assert that the following circumstances warrant the further intervention by the Court at this stage:

Despite the fact that the November Orders affect the rights and liabilities of the Applicants, the Dissenting Members failed to join the Applicants;
The Applicants would suffer irremediable prejudice and detriment if AHEPA Australia Limited and the Association were to operate by the regime that would be put in place by the November Orders;
The November Orders go beyond the subject matter in dispute "such that [the ramifications for the Applicants following consent orders in other proceedings] was not anticipated at the hearing of the dispute at first instance"; and
the November Orders do not reflect the Court's reasoning in the Principal Reasons.

Jurisdiction to Entertain the Reopening Application

The jurisdiction of the Court to set aside or vary the November Orders is not in doubt. Under UCPR r 36.16, the Court has power to correct orders where it is shown that the orders do not correctly reflect the Court's decisions as contained in its reasons. [9] In addition, under UCPR r 36.16(1), the Court may set aside or vary a judgment or order if an application is made before entry of the judgment or order. However, the November Orders have been entered. Nevertheless, irrespective of entry, under UCPR r 36.16(3A) the Court has power to set aside or vary orders if a notice of motion seeking the setting aside or variation is filed within 14 days after entry. The Reopening Application was filed within 14 days after the November Orders were entered, albeit that it was not filed by the Association but by the Applicants, which were not parties to the appeal.
In addition, under UCPR r 36.15(1), the Court has power to vary or set aside a judgment or order after the entry if the judgment was given or the order was made, irregularly, illegally or against good faith. The Applicants assert that the failure to join them as parties to the proceedings constituted an irregularity.
Having regard to the importance of the finality of litigation, the Court's jurisdiction to set aside orders and permit the reopening of proceedings should be exercised sparingly and with caution [10] and the power ought not to be exercised to permit a general reopening of a case. [11] In particular, the purpose of the jurisdiction to reopen proceedings is not to provide a backdoor method by which unsuccessful litigants can seek to reargue their cases. [12]
Two distinct questions are raised by the Reopening Application. One is whether the Principal Reasons proceeded on a misapprehension of the facts and whether the November Orders reflect the intent of the Principal Reasons. The other concerns the entitlement of the relevant Chapters to be heard and, if so, to adduce fresh evidence. For the reasons that follow, the Principal Reasons should be clarified and the November Orders should be varied. The Reopening Application, as presently constituted, should be otherwise dismissed.

Position of the Applicants

The Applicants seek to be joined as parties to the proceedings and the appeal. They were not necessary or even proper parties to the proceedings at first instance or on appeal. On no view were the Applicants members of the Association. The only interest that the Applicants may have in the outcome of the appeal is an indirect one in that, on the basis of the contentions advanced, new members of the Applicants may not be eligible for membership of the Association, even if existing members of the Applicants are members of the Association. On one view, therefore, they would not be bound by the orders made.
However, there are situations where a person may be precluded from litigating a claim that has or could have been litigated in earlier proceedings, albeit that the person in question was not a party to those proceedings and there is no res judicata or issue estoppel binding the person. Thus, where a person, who has an interest in proceedings and who knows of the proceedings, and who could intervene in the proceedings and apply to be made a party, stands by to see the battle fought by someone else in the same interest, that person should not be afforded the opportunity of a second chance and should be bound by the result. Such a principle is founded on justice and common sense. If the Court is satisfied that everything has been done bona fide in the interests of persons who subsequently seek to disturb the result, the Court should not allow the matter to be reopened. [13]
Thus, a person who was not a party to earlier proceedings may nonetheless be precluded from maintaining later proceedings in respect of substantially the same subject matter, even though not a privy in the strict sense of a party in the earlier proceedings. If the person is sufficiently identified with a party to the earlier proceedings and it was unreasonable to stand by and allow the earlier proceedings to be determined without intervening, the person may be prevented from relitigating the question. The principle will apply in any proceedings if the subsequent litigant conducted, controlled or managed the earlier proceedings or the other party to the proceedings was induced to believe that the suit was sufficiently constituted by the subsequent litigant. [14] That is to say, where a given issue is raised in litigation for adjudication, the parties ought to bring forward the whole of their case and, if one of them fails to do so, in circumstances where it was unreasonable not to do so, the person may thereafter be estopped from raising the issue in later proceedings. [15]
If a person stands by and waits to see the outcome of a case in which that person has a distinct interest and does not seek to become a party, any attempt to relitigate an issue may be an abuse of process. Thus, it is an abuse of process to initiate proceedings in a court for the purpose of mounting a collateral attack upon a final decision against the intending plaintiff that has been made by another court of competent jurisdiction in previous proceedings in which the intending plaintiff had a full opportunity of contesting the decision in the court by which it was made. [16]
It is contrary to the efficient administration of justice for a party who could have caused others with a similar interest to join in proceedings to refrain from doing so and then seek, indirectly, to relitigate the issue through another entity controlled by the person. It is contrary to the quick, just and inexpensive resolution of litigation and offensive to the administration of justice for a person to circumvent such principle by, in effect, suing through a different controlled entity. The question depends upon reasonableness. [17] On the other hand, merely attempting to relitigate the question does not necessarily constitute an abuse of process. Some additional element is required such as a collateral attack on a previous decision, dishonesty or successive actions amounting to unjust harassment. [18]
While the rule requiring interested persons to be joined as parties to proceedings rests on general principles of natural justice, [19] the rule is relaxed when the number of persons is so large as to make joinder unwieldy. [20] For declaratory relief to be granted, it is not necessary for every affected person to be a party to the proceedings. It is necessary only that the interests of every affected person are adequately presented. [21] Where the class of persons interested is too large for all members to be made parties, one or more of the class may be appointed to represent the whole class.
Apart from the three Dissenting Members, the Association had some 489 members. [22] Those persons could be affected by the November Orders. Thus, it is at least arguable that any member of one of the Applicants, who is also a member of the Association, or claims to be a member of the Association, could be affected by the November Orders. The Dissenting Members assert that it would have been impracticable to join all purported members of the Association and that the Association was a sufficient contradictor to represent the interests of the purported members who opposed the position taken by the Dissenting Members. Therefore, the Dissenting Members assert, there has been no injustice arising from the absence of those members of the Association as parties.
During the oral hearing, the Court suggested that it may be appropriate for individuals who are members of the Applicants to be substituted for the Applicants and to represent all members of the Applicants. That suggestion was made in the expectation that any such individuals would simply be substituted for the eight Chapters who are the Applicants. However, the suggestion has not been taken up.
Significant questions of costs would be involved if the Reopening Application were to be allowed, in that the costs of the hearing at first instance before the primary judge and of the appeal before this Court would be thrown away. The Reopening Application, as presently constituted, should be refused in so far as the Applicants seek to be joined as parties.

Position of the Association

The position of the Association must be distinguished from that of the Applicants. The Applicants have only foreshadowed the nature of the evidence that they would seek to adduce. They have not actually set out in an affidavit the evidence upon which they intend to rely if afforded the opportunity. That is fatal in so far as the Reopening Application is an application on behalf of the Association to adduce further evidence, since UCPR 51.51(4) requires, not only that evidence necessary to establish the grounds of the application to adduce further evidence be given by affidavit, but also that the evidence that the applicant wants the Court to receive also be given by affidavit.
In so far as the Reopening Application is supported by the Association, through its solicitor, that support must therefore be understood as an application by the Association to reopen on the basis that the November Orders do not correctly reflect the Court's decisions as contained in the Principal Reasons or exhibit a misapprehension of the facts in evidence. The considerations relevant to the grant of an indulgence to the Association to adduce further evidence are somewhat different from the considerations relevant to the question of whether the Court should reopen its consideration of the issues because the November Orders do not reflect the reasons of the Court or exhibit a misapprehension of the facts in evidence.
At first instance and in the hearing in this Court, the Association was represented by counsel and solicitors. Accordingly, the hurdles that must be overcome by the Association, for it to be permitted to adduce further evidence at this stage, are high indeed.
While an appeal to this Court is to be by way of rehearing, [23] where the decision or other matter under appeal has been given after a hearing, the Court may receive further evidence in an appeal. [24] However, where the appeal is from a judgment after a trial or hearing on the merits, as this appeal is, the Court is not to receive further evidence except on special grounds, [25] unless the evidence concerns matters that occur after the trial or hearing. [26] That constraint is applicable in so far as the Association is concerned.
Thus, in so far as the Reopening Application is to be regarded as an application on behalf of the Association to adduce further evidence, it could not possibly succeed. There is no basis for contending that there are special grounds for permitting the Association to reopen for the purposes of adducing further evidence. Even if an application had been made prior to the hearing of the appeal for leave to adduce further evidence, no special grounds have been demonstrated for permitting the Association to do so. All of the further evidence foreshadowed on behalf of the Applicants was available to the Association prior to the hearing before the primary judge.
On the other hand, in so far as the Reopening Application is based on the ground that, in the Principal Reasons, the Court proceeded on a misapprehension as to the facts or that the November Orders do not properly reflect the Principal Reasons, the position is different. If, on the basis of the evidence presently before the Court, the Court proceeded under a misapprehension, a case could be made for allowing the Association to reopen in order to disabuse the Court of the misapprehension. However, the Association must demonstrate that the misapprehension is material and that the true circumstances or facts would be decisive or at least very compelling in leading to a different outcome.

The Principal Reasons

The difficulties in relation to the November Orders arise out of observations in the Principal Reasons concerning the subordinate position of the Association and Chapters to the organisation that existed in 1990 that was referred to as "AHEPA Australia". Those observations were reflected in the November Orders, which were premised upon AHEPA Australia Limited being considered the successor to the unincorporated association, AHEPA Australia.
The principal matters in dispute were, first, the meaning of the "unincorporated association" in r 3(1), and second, whether r 3(1) and r 3(2) were cumulative or alternative requirements. The answer to the first question involved an historical consideration of the Association's Rules as they evolved from 1993 to 2010 as compiled in 2018. The primary judge and the Principal Reasons ultimately concluded that membership of the "unincorporated association" in r 3(1) was satisfied in the same way, by membership of a New South Wales Chapter. Yet each made certain findings in the course of reaching that conclusion that led to different findings on the second question.
Thus, at [114], the Principal Reasons said as follows: "The primary judge was correct in concluding that unincorporated association had come to refer to Chapters in the sense described above, such that Chapter membership satisfied the requirement for membership of the 'unincorporated association'. However, that conclusion is correct only in so far as membership of the Chapters is the same as membership of AHEPA Australia, because the latter is the unincorporated association." (footnotes omitted) A question has been raised as to the correctness of the last sentence, in so far as it suggests that membership of the Chapters is the same as membership of AHEPA Australia Limited.
The effect of [114] was to agree with the primary judge that r 3(1) of the Association's rules contemplated membership of a Chapter geographically located in New South Wales. So much so is apparent from the conclusion at [147] of the Principal Reasons as follows: "It would follow that, in order for a person to be entitled to be a member of the Association within the meaning of r 3(1) of the 2018 Rules of the Association, that person must be shown to have been, on 30 June of the last financial year before applying for membership, a financial member of a New South Wales Chapter of AHEPA Australia or its successor. If a person has not, on 30 June of the last financial year, been a financial member of a New South Wales Chapter of AHEPA Australia or its successor, such a person can only be an associate member of the Association who is not entitled to participate in resolutions of the Association." (my emphasis)
The question for determination in the proceedings at first instance and in the appeal was not whether Chapters should now be conclusively regarded as "Chapters of" AHEPA Australia, of AHEPA Australia Limited or of the Association. Rather, the question was whether persons who voted in the November 2018 meeting, who were not members of one of the 13 Chapters as at the previous financial year, [27] were entitled to vote. Against that background, the remark at [114] that the primary judge's "conclusion is correct only in so far as membership of the Chapters is the same as membership of AHEPA Australia, because the latter is the unincorporated association", requires clarification.
The primary judge's conclusion as to the identity of the "unincorporated association" was: [28] "Rather, I consider the reference to the "unincorporated association" in 1993 was to the entity referred to in the 1981 trust deed and Part XIV of the Constitution of The Order of AHEPA Australasia, that is, The Order of AHEPA in the State of New South Wales." The Principal Reasons came to the same conclusion, regarding the identity of the "unincorporated association" as follows: [29] "The relationship between the organisation referred to in the Trust Deed and AHEPA Australia, which was the subject of the 1990 AHEPA Constitution, is not entirely clear. However, it is clear enough that the organisation referred to in the Trust Deed is the same organisation as is referred to in Pt XIV of the 1990 AHEPA Constitution…It follows that 'the unincorporated association' referred to in the 1993 Rules of the Association was the organisation referred to in the Trust Deed on whose behalf the Trustees held property." That is to say, both the primary judge and the Principal Reasons concluded that "unincorporated association" referred to the "The Order of AHEPA in the State of New South Wales", as referred to in Pt XIV of the 1990 AHEPA Constitution.
The primary judge was satisfied that the 1990 AHEPA Constitution documented numerous individual unincorporated associations including the Order of AHEPA in the State of New South Wales, Chapters and AHEPA Australia. [30] Her Honour considered that the Chapters, Grand and District Lodges and State Convention "were not subordinate units of a national body, but distinct entities in their own right, not established by the national body but pre-dating it and with an independent existence". [31] Thus, upon incorporation in 1993, the Association succeeded the individual unincorporated association, "the Order of AHEPA in the State of New South Wales", which thereafter ceased to exist. [32]
That background informed what her Honour perceived as a shift in meaning that occurred between the 1993 and the 2003 Rules of the Association. Relevantly, her Honour said: [33] "In its original sense, 'unincorporated association' in rule 3(1)(a) was a reference to The Order of AHEPA in the State of New South Wales as it existed pre-incorporation in 1993. As that term had come to be used in rule 3(1)(a), as a result of the loss of the 1993 Rules for a period of time, the development of a practice of assembling the Register of Members each year based upon the lists of financial members submitted by the Chapters to the State Convention, the recasting of the Rules in 2003 to record this practice, and further amendments in 2005 and 2010, 'unincorporated association' had come to mean the Chapters." (my emphasis)
Thus, her Honour considered, the term "unincorporated association" had had two different meanings over time such that from 2003, r 3(1) was satisfied by Chapter membership, whereas the earlier iteration in the 1993 Rules was a transitional provision directed toward a now non-existent entity. In contrast, the Principal Reasons considered that "unincorporated association" could not refer to the Chapters alone and that "unincorporated association" remained a relevant concept notwithstanding the incorporation of the Association in 1993.
The Principal Reasons found that, absent any evidence contradicting the 1990 AHEPA Constitution and Regulations that regulated Chapters, Grand Lodges, "the Order of AHEPA in the State of New South Wales" and the other "units" of the Order of AHEPA so described, each of those various bodies should be considered subordinate to the unincorporated association referred to as AHEPA Australia, as that organisation existed and was constituted in 1990. [34] In that context, although the Principal Reasons and the primary judge agreed that "unincorporated association" referred to "the Order of AHEPA in the State of New South Wales", the finding of subordinacy in the Principal Reasons assumed significance because membership of "the Order of AHEPA in the State of New South Wales" necessarily connoted membership of a wider organisation, AHEPA Australia.
Thus, financial membership of the "unincorporated association" required one to be a part of "the Order of AHEPA in the State of New South Wales". Under the 1990 AHEPA Constitution and Regulations, the "basic unit" of AHEPA Australia was the Chapter. Members of AHEPA Australia were those individuals who were members of a Chapter, and Chapters are geographically organised such that they can be identified as located in one State or another. Thus, membership of AHEPA Australia had a geographical quality such that the membership of the Order of AHEPA in the State of New South Wales could be identified as those members of Chapters located in New South Wales. Notably, a number of the eight Chapters, as well as Chapters associated with the Dissenting Members are listed in the 1990 AHEPA Regulations as units of AHEPA Australia.
Aside from the steps required to join a Chapter set out in the 1990 AHEPA Constitution and Regulations, nothing more appeared to be necessary to be a member of the "unincorporated association", the Order of AHEPA in the State of New South Wales and, ultimately, its parent, AHEPA Australia. Thus, while membership of the "unincorporated association" ultimately referred to membership of AHEPA Australia, in practical terms, that condition was satisfied by membership of a Chapter geographically located in New South Wales. The amendments to the Association's rules between 2003 and 2010, by which the role of the "unincorporated association" gained greater significance to the functioning of the Association, reflected that understanding rather than constituting a different meaning altogether.
For the reasons given in the Principal Reasons, there must have been some continuing "unincorporated association" by reference to which the Association conducted its affairs. Thus, "unincorporated association" could not refer to the Chapters alone, as somehow distinct from AHEPA Australia.
First, that would be inconsistent with r 15 of the 2018 Rules of the Association, which refers to the Grand President and the District President as "office bearers" of the "unincorporated association". On the available evidence, the only entities that had office bearers corresponding to those titles were the Grand and District Lodges, which were bodies regulated within, and seemingly subordinate to, AHEPA Australia. [35]
Secondly, the Principal Reasons concluded that Chapters are subordinate "units" of the organisation regulated by the 1990 AHEPA Constitution and the 1990 AHEPA Regulations and have no independent existence separate from that organisation. [36] The Principal Reasons proceeded on the basis that AHEPA Australia Limited succeeded AHEPA Australia, but the conclusion, as indicated at [147] of the Principal Reasons, was that it was Chapter membership that r 3(1) called for. That was because, under the 1990 AHEPA Australia Constitution and Regulations, Chapter membership was itself sufficient to constitute membership of the "unincorporated association". Therefore, it was not necessary to construe "unincorporated association" as "the Chapters". It appeared that gaining membership of a Chapter, under the 1990 AHEPA Constitution and Regulations, would have involved the acceptance of that Constitution and Regulation.
It may well be the case that AHEPA Australia Limited is not appropriately described as a successor body to AHEPA Australia or "the Order of AHEPA in the State of New South Wales". However, in terms of identifying what r 3(1) required of individuals, it was membership of a Chapter located in New South Wales that was required. Both the primary judge and the Principal Reasons concluded that membership of the "unincorporated association" was established by membership of a Chapter geographically located in New South Wales.
The Principal Reasons proceeded on the assumption that, as a matter of fact, subordinacy continued to exist as between the Order of AHEPA in New South Wales and AHEPA Australia and then AHEPA Australia Limited. That now appears to have been a misapprehension of the facts. Nevertheless, the essential point was that the term "unincorporated association" referred to AHEPA Australia as it existed in 1990 and seemingly throughout the period of amendments to the Associations Rules up until at least 2010.
It may be that the organisation that now encompasses the Grand Lodge of New South Wales and the components below it, including Chapters in New South Wales, can no longer be said to be in any real way subordinate to AHEPA Australia and its apparent successor, AHEPA Australia Limited. It may be that the Order of AHEPA in the State of New South Wales was always separate and never a part of AHEPA Australia. However, in the state of the evidence before the Court, those are matters of speculation. Whatever the true position may be, it is not correct to say that the Chapters became the "unincorporated association", even though it was sufficient, in order to satisfy the requirement for membership of the Association, to be a member of a Chapter in New South Wales.
The Principal Reasons should not be understood as requiring that being on a register of AHEPA Australia Limited, in accordance with Pt II cl 2 of the AHEPA Australia Limited Constitution, was a prerequisite for membership of the Association. That was not something required by the 1990 AHEPA Constitution or the Regulations. It was not the intention of the Principal Reasons to suggest that satisfaction of r 3(1) of the 2018 Rules and its predecessors entailed additional requirements that did not exist in 1993 going beyond membership of a Chapter. Notwithstanding that there may have been a change in the entitlement conferred by membership of a Chapter, in the sense that, in 1990, membership of a Chapter conferred entitlement to membership of AHEPA Australia, it is now apparent that membership of a Chapter does not equate to membership of AHEPA Australia Limited. Rule 3(1) refers to membership of the Chapters located in New South Wales, be they connected with AHEPA Australia Limited or otherwise.
The primary judge's conclusion that "unincorporated association" had come to mean membership of a Chapter was equivalent to the conclusion intended by the Principal Reason's, that r 3(1) would be satisfied by membership of one of the 13 Chapters at the conclusion of the previous financial year. The Principal Reasons proceeded on the assumption that the 13 Chapters were the Chapters located in New South Wales.
However, the findings of subordinacy in the Principal Reasons, in at least the historical sense, were relevant to determining whether the requirements of r 3(1) and r 3(2) were cumulative or alternative pathways to membership. That is different from the question of whether subordinacy continues to exist in relation to AHEPA Australia Limited or some different body. It was in that context that the subordinacy of Chapters became relevant in construing the 2018 Rules. Accordingly, the force of the conclusions reached in the Principal Reasons does not depend on the proposition that AHEPA Australia Limited is the successor to AHEPA Australia. Nevertheless, that is the basis upon which the November Orders should be varied.
Thus, the basis for the Principal Reasons concluding that the requirements were cumulative included the following reasons: [37] "Secondly, for a member to be admitted under r 3(2)(b) of the 2018 Rules of the Association, that member must, in accordance with r 4(1)(a), be nominated by the Secretary of a 'unit' of 'the unincorporated association'. It would be curious for the Secretary of 'the unincorporated association' to be designated to nominate new members for the Association if the nominees were not required to be members of the unincorporated association. Third, it would be nonsensical for membership of the Association to lapse under r 5(1)(d) of the 2018 Rules of the Association where a person became an 'unfinancial member' of 'the unincorporated association' unless all members were first required to be a financial member of the 'unincorporated association'. There is no provision for a separate register to be kept of members admitted under r 3(1), as distinct from members admitted under r 3(2). Fourth, under r 15 of the 2018 Rules of the Association, the Committee of Management of the Association is composed of office bearers of 'the unincorporated association' and persons nominated by Chapters of the 'unincorporated association'. If the membership of the Association were not the same as the membership of the unincorporated association, there would be members of the Association who have no say in the composition of the Committee of Management and no ability to be appointed to the Committee of Management. Fifth, the Association was created for the purpose of managing the assets of those members of the organisation governed by the 1990 AHEPA Constitution and the 1990 AHEPA Regulations who were situated in New South Wales. That organisation is the 'Australian Hellenic Educational Progressive Association'. The Association was incorporated in order to take over the functions of the Trustees, such as under the Trust Deed. The beneficiaries under the Trust Deed were the members of the NSW based Chapters of the organisation referred to in the 1990 AHPEA Constitution and the 1990 AHEPA Regulations. The incorporation of the Association was not intended to terminate the membership of that other organisation."
Clearly enough, the Association operated after its incorporation in a manner suggestive of the existence of an "unincorporated association" that shared similarities with at least the State organisation of the 1990 AHEPA Australia Constitution and Regulations. There remained Grand Lodge Presidents and other office holders, who took office within the Association in accordance with the Association's Rules. That appeared to be in conformity with the 1990 AHEPA Constitution and Regulations. However, it might equally be in conformity with a State-based organisation carrying on independently of the overall AHEPA Australia framework, but retaining the same terminology.
On the available evidence, it was correct to regard them not as independent entities, but rather as being subordinate to AHEPA Australia, at least in 1993. The significance is that it was artificial to consider the reference to the "unincorporated association" as meaning simply "the Chapters". It is equally artificial to consider "unincorporated association" as referring to "the Chapters" because it is apparent that an organisation, namely the Grand Lodge of New South Wales, continued to exist with office bearers that served as relevant office holders in the Association. It was clearly infelicitous to refer to the organisation that now includes the Grand Lodge of New South Wales as being Australia AHEPA Limited as the successor of AHEPA Australia, in circumstances where that organisation does not retain any reference to a Grand Lodge or the other features that were present in the 1990 AHEPA Constitution and the Regulations.
The question of whether a Chapter is now a part of AHEPA Australia Limited or some unincorporated New South Wales variant of AHEPA Australia or something else, is not significant for the purpose of construing the 2018 Rules. All that matters is that there was some concurrently operating unincorporated association. That was all that was necessary, without going further, to resolve the construction issue at the heart of the dispute.
Thus, for the purposes of the second reason noted above, it makes no difference, for the requirement that a person nominated by the secretary of a "Unit" of "the unincorporated association", whether "unincorporated association" means AHEPA Australia Limited or properly refers to a different, State based, association. The point is that the relevant provision assumed that a "Unit" was a Chapter located in New South Wales and that the secretary of that Unit would lodge the nomination with the Secretary of the Association as required by r 4(1)(b).
For the third reason noted above, it makes little sense to regard the Association as a successor to an unincorporated association that ceased to exist upon incorporation, in circumstances where the Association's Rules make provision for situations where a person ceases to become a financial member of the unincorporated association. That indicates recognition of a persisting entity beyond incorporation, the membership of which being satisfied by membership of a New South Wales based Chapter.
Similarly, for the fourth reason noted above, the Association is composed of specified office bearers of "the unincorporated association" and persons nominated by Chapters of the "unincorporated association". That is to say, there is some other unincorporated association in existence and it is the fact of its existence and significance to the workings of the Association that it makes sense to construe r 3(1) and r 3(2) as cumulative. If, as a review of the Constitution of AHEPA Australia Limited suggests, that organisation does not provide for the Grand Lodge President and other officers, there may well be another State based unincorporated association.
It would be curious and artificial for AHEPA Australia Limited, as an organisation that does not have Grand Presidents and the like, to claim now that it does have such officers if there is some other unincorporated association in New South Wales that does have such officers and has done for some time. Those matters go beyond the scope of what was needed to resolve adequately the construction question. That is to say, irrespective of the identity of that "unincorporated association", r 3(1) and r 3(2) of the Rules of the Association should be construed as cumulative. It follows that any individual who was not a member of one of the 13 Chapters was not entitled to participate in or vote at the November Meeting.

The Relevant Factual Circumstances

There are 13 Chapters located in New South Wales (the 13 Chapters). The 13 Chapters are: 1. Chapter Arete No.3 (a female chapter); 2. Chapter Platon No.4 (a combined chapter); 3. Chapter Prometheus No.6 (a male chapter); 4. Chapter Anatole No.7 (a male chapter); 5. Chapter Diogenes No.8 (a combined chapter); 6. Chapter Antigone No.8 (a female chapter); 7. Chapter Antigone No.27 (a combined chapter); 8. Chapter Heracles No.12 (a combined male/female chapter); 9. Chapter Apollon No.16 (a male chapter); 10. Chapter Ippokratis No.21 (a combined male/female chapter); 11. Chapter Chiron No.22 (a combined male/female chapter); 12. Chapter Alexandros No.25 (a combined chapter); and 13. Chapter Odysseas Elytis No.26 (a combined male/female chapter). These 13 Chapters include the Applicants, each of which has been incorporated under the 2009 Associations Act or the 1984 Associations Act. Of the remaining five Chapters, Chapter Heracles No. 12 appears to be incorporated and the other four have not been incorporated under the 2009 Associations Act or under the 1984 Associations Act.
The 13 Chapters were referred to in the reasons for judgment of Black J of 13 April 2018 in proceedings concerning the validity of resolutions purportedly passed by the Association in 2005, 2007 and 2010 (the Earlier Resolutions). [38] On 21 March 2018, Black J made orders by consent pursuant to s 1322(4)(a) of the Corporations Act, as applied by ss 96 and 97 of the 2009 Associations Act, that the Earlier Resolutions were not invalid by reason of any contravention of the 1984 Associations Act, 2009 Associations Act or the constitution39 of the Association and that acts, matters or things purporting to have been done by the Association or persons acting on the Association's behalf are not invalid by reason of any invalidity of those resolutions or failure to lodge or register them under the 1984 Associations Act or the 2009 Associations Act. Black J also noted an agreement between the parties to the Earlier Proceedings, to the effect that the persons who are members of the Association in the financial year in which a proposed special general meeting is held and who are also entitled to vote at the special general meeting consist of all persons who as at 30 June immediately preceding the holding of the special general meeting were financial members of one of the 13 Chapters.
If the November Orders stand, delegates from the eight Applicants will not be allowed to participate in the Committee of Management. If the members of the Applicants are not able to participate as delegates in the Committee of Management of the Association, there may be a risk that the Dissenting Members could control the Association to the exclusion of the members of the Applicants and could take steps to ensure that the Association does not prosecute its application for special leave to appeal to the High Court.
The Applicants say that construing the phrase "unincorporated association" in cll 15(1), 15(2), 15(3) and 15(4A) of the 2018 Rules of the Association as referring to AHEPA Australia Limited would create difficulties if there has never been a Grand President or District President of AHEPA Australia Limited and none of the Applicants and no member of the Applicants is or has been a member of AHEPA Australia Limited. The Applicants complain that, since there is no reference in the constitutions of any of the Applicants to AHEPA Australia Limited, the effect of the November Orders would be to alter the operation of the Association and to change "the operation of the Constitutions" of the Applicants.
By the new constitution for the Association that was purportedly adopted at the 13 November 2018 Meeting, an attempt was made to resolve the difficulties of meaning and construction that have given rise to these proceedings. The constitution of the Association was purportedly amended by substituting the following definitions in cl 1, which deals with "Interpretation": "In this Constitution, except in so far as the context of subject matter otherwise indicates or requires - (1) Association means the incorporated association constituted by this document and registered by the Commissioner for Fair Trading, Department of Finance Services and Innovation with incorporation Number Y1649605. (2) "Chapter" means an incorporated Association [39] or unincorporated Association to which a charter has been granted and not revoked by the Grand Lodge. To remove any doubt, as at 30 June 2018, those Chapters were: [the 13 Chapters]".
Part II of the Constitution, dealing with "Membership", was to be amended to provide, relevantly, as follows: "4. MEMBERSHIP (1) A person is a member of the Association: (a) if the person: (i) was a financial member of the unincorporated predecessor of the Association on the 30th June 1992 (being the end of the last financial year prior to the incorporation of Association); and (ii) has been approved by the Grand Lodge and the Committee; or (b) notwithstanding any provision or procedures in the By-Laws of any Chapter, if the person has been nominated, endorsed and entered in the register of members of the Association as provided by clause 5. 5. NOMINATION FOR MEMBERSHIP (1) A Chapter, secretary or member of the Committee of Management may nominate a person for membership of the Association. (2) A nomination must be made in writing in the form determined by the Committee of Management. (3) A nomination must be lodged with the Secretary of the Association. (4) As soon as practicable after receiving a nomination, the Secretary shall refer the nomination to the Committee of Management for endorsement. (5) If the Committee of Management endorses the nomination, the Secretary shall notify the nominee and request the nominee to pay within the period 28 days after receipt of the nominee of the notification the sum payable under clause 10(1) as an entrance fee. (6) The Secretary shall, on payment by the nominee of the amount referred to in clause 10(1) within the period referred to in that clause, enter the nominee's name in the register of members and, upon the name being so entered, the nominee becomes a member of the Association."
It is now apparent that the construction and meaning of "unincorporated association" adopted in the Principal Reasons could have significant consequences for the management and regulation of the Association and its affairs. However, it is not clear how that bears on the meaning of the phrase "the unincorporated association" when it appears in the Rules of the Association, from the time of its incorporation in 1993.
Paragraph [117] of the Principal Reasons said that the impugned 2018 Constitution of the Association sought to vest in the Grand Lodge of New South Wales a measure of control with respect to Chapters located in New South Wales, similar to that of AHEPA Australia, thereby rendering those Chapters subordinate to the Grand Lodge of New South Wales, whereas a survey of the 1990 Constitution and Regulations of AHEPA Australia indicated that the Chapters were subordinate to AHEPA Australia. The Applicants assert that paragraph [117] assumes that all the New South Wales Chapters were Chapters of AHEPA Australia and that that assumption was erroneous.
Part I of the 2017 AHEPA Constitution contains a diagrammatic flowchart of the structure of AHEPA Australia Limited, which is set out in the Appendix to these reasons. The flowchart shows a National Council at the head of a hierarchy that contained male Units, combined Units and female Units. The Units are Chapters. The 1990 Regulations of AHEPA Australia list as Chapters of the Order of AHEPA three Chapters with names similar to those of several of the Applicants. Those three appear again in the 2010 AHEPA Constitution and By-Laws, in addition to two more names similar to those of two of the Applicants. Clause 1 of Pt VI of the 2017 AHEPA Constitution provides that the "Unit" is to be the basic primary and fundamental unit of AHEPA and that each member of AHEPA is to be a member of a Unit. Clause 4 of Pt VI refers to the power to grant charters to "new Units", which was to be vested in the National Council and were to be issued following a recommendation from the State Council. Clearly enough, the Units are Chapters.
Being a member of a Unit is a necessary qualification for being a member of AHEPA Australia Limited but one does not necessarily become a member of AHEPA Australia Limited simply by being a member of a Unit. The effect of the November Orders would be that, to become a member of the Association, a person must be a member of a Chapter that is a Unit of AHEPA Australia Limited. By reference to the 2010 AHEPA Constitution and By-Laws, most of the predecessors of the Applicants appear to have been Units of the unincorporated organisation known as AHEPA Australia (referred to as AHEPA Australasia after 2010). It is not clear if this remained the case by the time of the incorporation of AHEPA Australia Limited.
The Court's task is to ascertain the meaning of the terms in the Rules of the Association. A cause of great difficulty is that those rules operate by reference to the affairs of bodies external to the Association. Whatever might have been thought to be the position in 2018 is irrelevant. The question is whether the predecessors of the Applicants, previously unincorporated Chapters, were Chapters of AHEPA Australia. It appears that they were.

Conclusion

The Principal Reasons proceeded on a misapprehension as to the structure of AHEPA Australia Limited and possibly its predecessor, AHEPA Australia, and the relationship of that structure with the Association. Thus, the Principal Reasons proceeded on the basis that all Chapters located in New South Wales were Chapters of AHEPA Australia prior to its conversion to a company limited by guarantee under the name of AHEPA Australia Limited and that the only entity that had office bearers corresponding with relevant titles was AHEPA Australia Limited.
The Principal Reasons intended to make clear that an individual who attended the November 2018 Meeting, but who was not relevantly a member of one of the 13 Chapters was not entitled to vote. The construction of the 2018 Rules as to membership of the Association adopted in the Principal Reasons should stand. However, the November Orders should be varied to reflect the reasoning of the Principal Reasons as explained above.
In the light of the misapprehension that AHEPA Australia Limited was the successor to the unincorporated association, it is appropriate to confine the November Orders to the specific relief sought in the proceedings. Further, in the light of the events chronicled by the primary judge concerning the "split" between the Grand Lodge of New South Wales and the national AHEPA organisation (at [92]-[94]), there may be further arguments about the significance of such events to determining office bearers. In those circumstances, although references in the 2018 Rules of the Association to Grand Presidents and other matters provide helpful context in construing the object of the "unincorporated association" in r 3(1), the preferable course is for the Court to avoid making any determination in relation to other provisions that were not directly in issue.
By Order 3.b. of the November Orders, the Court declared, relevantly, that, on and from the date of registration of the Earlier Resolutions, "in order to become a member of the Association who is entitled to vote at any general meeting of the members of the Association, a person must have been a financial member of a Chapter (or Unit) of AHEPA Australia that is geographically situated in New South Wales on 30 June of the last financial year". It is certainly arguable, in the light of the factual circumstances set out above, that Order 3.b. goes beyond what was claimed on behalf of the Dissenting Members or is, at best, ambiguous. In any event, it goes beyond what was intended by the Principal Reasons.
On one view, the phrase "who is entitled to vote at any general meeting of the members of the Association" qualifies the phrase "in order to become a member of the Association", such that those who are already on the register of members of the Association would not be affected by the November Orders. The alternative view is that even those persons recorded on the register of members of the Association have no entitlement to vote unless they satisfy the cumulative prerequisites of r 3 of the 2018 Rules of the Association, as construed by the Court.
The November Orders were not intended to alter the current membership of the Association. To reflect properly the reasoning of the Principal Reasons, Order 3.a. should be rescinded and Order 3.b. should simply declare that, on and from the Registration Date, in order to become a member of the Association who is entitled to vote at any general meeting of the members of the Association, a person who was not already a member of the Association as at the Registration Date must have been a financial member of one of the 13 Chapters on 30 June of the last financial year.
Accordingly, Order 3 of the November Orders should be amended to read as follows: 3. Set aside orders made by the primary judge on 3 October 2019 and, in lieu thereof: b. Declare that, on and from the registration of the 2005 resolutions, the 2007 resolutions, and the 2010 resolutions in accordance with the orders of Black J made on 21 March 2018 in proceeding number 2016/380711 in the Supreme Court of New South Wales (the 2018 Orders), in order to become a member of the first respondent (the Association) who is entitled to vote at any general meeting of the members of the Association, a person must have been a financial member, on the 30th of June of the last financial year, of one of the 13 Chapters referred to in the 2018 Orders. c. Declare that the resolutions purported to be passed at the special general meeting of the Association held on 13 November 2018 are invalid and that the proceedings at that meeting were void. d. Order that the second respondent rectify the Register of Incorporated Associations maintained under s 98 of the Associations Incorporation Act 2009 (NSW) by removing the purported constitution of the Association registered on or about 18 December 2018 from the Register. e. Declare that the resolution (described as a "motion") referred to in the notice of general meeting dated 11 February 2019 signed by Bill Skandalakis and Panayiotis Diamadis, circulated to certain members of the Association, and subsequently purported to be declared carried at a general meeting of the Association on 28 February 2019, in the following terms, is invalid and of no effect: "3) That the Committee of Management be authorised to obtain funds not exceeding seven million dollars (AUD$7M) for the construction and the completion of Stage 1 of the project." f. Declare that between 1 December 2018 and 15 March 2019, the Association did not validly appoint any person to occupy the office of Secretary or Treasurer of the Committee of Management of the Association.
It is apparent that there will be difficulties as to the operation of the Rules of the Association in so far they refer to the "unincorporated association". For example, there is no mechanism to address the situation where new Chapters purport to have been established and claim that they should have a part in the Association, since, in effect, the orders freeze the composition of the unincorporated association, limiting it to the 13 Chapters. There may well be mechanisms open to the members of the Association to remedy those difficulties. However, those questions are not presently before this Court.
The Reopening Application should be otherwise dismissed. However, it will be necessary to hear further argument on the question of the costs of the Reopening Application.

Endnotes

See Lianos v Order of AHEPA NSW Inc [2020] NSWCA 193.
See Lianos v Order of AHEPA NSW Inc (No 2) [2020] NSWCA 304.
See Principal Reasons at [84].
See Principal Reasons at [158] and [159].
See Supplementary Reasons at [30].
See Supplementary Reasons at [39].
See Supplementary Reasons at [53] and [54].
See Lianos v Order of AHEPA NSW Inc (No 3) [2020] NSWCA 340.
See DJL v Central Authority (2000) 201 CLR 206; [2000] HCA 17 at [93].
See Majak v Rose (No 5) [2017] NSWCA 238 at [13].
See Poulos v Commonwealth Bank of Australia Ltd (No 3) [2020] NSWCA 72 at [7].
See Autodesk Inc v Dyason (No 2) (1993) 176 CLR 300 at 303; [1993] HCA 6.
See Wytcherley v Andrews (1871) LR 2 PD 327 at 328 and In the matter of HIH Insurance (in liq) [2014] NSWSC 774 at [37] and following and [59] and following.
See John Alexander Clubs Pty Ltd v White City Tennis Club Limited (2010) 241 CLR 1; [2010] HCA 19 at [143]-[144].
See Port of Melbourne Authority v Anshun (1981) 147 CLR 589; [1981] HCA 45.
See Hunter v Chief Constable of West Midlands Police [1982] AC 529 at 541.
See In the matter of HIH Insurance (in liq) [2014] NSWSC 774 at [59].
See Ann Street Mezzanine Pty Ltd (In liq) v Beck (2009) 175 FCR 532; [2009] FCA 333 at [33]-[34].
See John Alexander Clubs Pty Ltd v White City Tennis Club Limited (2010) 241 CLR 1; [2010] HCA 19 at [153].
See Carnie v Esanda Finance Corp Ltd (1995) 182 CLR 398 at 415-417 and 428-429; [1995] HCA 9.
See Ainsworth v Criminal Justice Commission (1987) 175 CLR 564 at 596; [1992] HCA 10 and Ahmed v Chowdhury [2012] NSWSC 1452 at [26], [41]-[45].
See Primary Judgment at [117].
See Supreme Court Act 1970 (NSW), s 75A(5).
See s 75A(7).
See s 75A(8).
See s 75A(9).
Defined below at [66].
See Primary Judgment at [41].
See Principal Reasons at [59].
See Primary Judgment at [25].
See Primary Judgment at [28].
See Primary Judgment at [58].
See Primary Judgment at [136].
In the sense referred to in Hall v Job (1952) 86 CLR 639 at 650; [1952] HCA 57.
See Principal Reasons at [115].
See Principal Reasons at [116].
See Principal Reasons at [150]-[153].
See In the matter of Order of AHEPA NSW Incorporated [2018] NSWSC 458.
The significance of "Association" being used with caps in (2), but not in (1) where that term was defined is unclear. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 06 August 2021

Associations Incorporation Act 1984(NSW)

See Supreme Court Act 1970(NSW)

47 CLR 589; [1981] HCA 45 Poulos v Commonwealth Bank of Australia Ltd (No 3) [2020] NSWCA 72 Wytcherley v Andrews (1871) LR 2 PD 327 Texts Cited: Nil Category: Consequential orders Parties: Chapter ALEXANDROS (First Applicant) Chapter ANATOLE (Second Applicant) Chapter ANTIGONE 27 (Third Applicant) Chapter CHIRON (Fourth Applicant) Chapter DIOGENES (Fifth Applicant) Chapter IPPOKRATIS (Sixth Applicant) Chapter ODYSSEAS ELYTIS (Seventh Applicant) Chapter PLATON (Eighth Applicant) George Lianos (First Respondent) Luke Kyprios (Second Respondent) Con Gouros (Third Respondent) Order of AHEPA NSW Inc (Administrator Appointed) (Fourth Respondent) Representation: Counsel: F Corsaro SC with LL McGovern (Applicants) M Ashhurst SC with D Meyerowitz-Katz (First to Third Respondents)

Solicitors: Pure Legal (Applicants) McCabe Curwood (First to Third Respondents) Tzovaras Legal (Fourth Respondent) File Number(s): 2019/335705 Publication restriction: Nil Decision under appeal Court or tribunal: Supreme Court of New South Wales Jurisdiction: Equity Citation: [2019] NSWSC 1329 Date of Decision: 3 October 2019 Before: Rees J File Number(s): 2019/25650

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