McClelland v Burning Palms Surf Life Saving Club

CITATION : McClelland v Burning Palms Surf Life Saving Club [2002] NSWSC 470 CURRENT JURISDICTION: Equity FILE NUMBER(S) : SC 5204/99 HEARING DATE(S) : 6/5/02 - 8/5/02 JUDGMENT DATE : 12 June 2002

PARTIES : Robert Francis McClelland (Plaintiff) Burning Palms Surf Life Saving Club (Defendant) JUDGMENT OF : Campbell J

COUNSEL : W L Marler (Plaintiff) S Bell (Defendant) SOLICITORS : Coode & Corry (Plaintiff) Terrett Lawyers (Defendant) CATCHWORDS : ASSOCIATIONS AND CLUBS - incorporated associations - expulsion procedures - natural justice - relationship between association rules and natural justice - whether rules can exclude natural justice - locus standi of association member to seek court relief concerning expulsion resolution Associations Incorporation Act 1984 LEGISLATION CITED : Charitable Fundraising Act 1991 Commonwealth Conciliation and Arbitration Act 1904 Trade Practices Act 1974 (Cth) Allinson v General Council of Medical Education and Registration (1894) 1 QB 750 Amos v Brunton (1897) 18 NSWR (Eq) 184 Australian Workers' Union v Bowen (No.2) (1948) 77 CLR 601 Balfour v Balfour [1919] 2 KB 571 Barnes v Australian Telecommunications Commission (1989) 25 FCR 283 Blackler v New Zealand Rugby Football League (Inc) [1968] NZLR 547 Bonsor v Musicians Union [1954] Ch 479 Broussard v Minister for Immigration, Local Government and Ethnic Affairs (1989) 21 FCR 472 Buckley v Tutty (1971) 125 CLR 353 Byrne v Kinematograph Renters Society Ltd [1958] 1 WLR 762 Calvin v Carr [1977] 2 NSWLR 308 Cameron v Hogan (1934) 51 CLR 358 Century Metals and Mining v Yeomans (1989) 40 FCR 564 Clisdell v Commissioner of Police (1993) 31 NSWLR 555 Colpits v Australian Telecommunications Commission (1986) 9 FCR 52 Council of Civil Service Unions v Minister for the Civil Service [1985] AC 374 Curro v Beyond Productions Pty Ltd (1993) 30 NSWLR 337 Dawkins v Antrobus (1881) 17 Ch D 615 Dickason v Edwards (1910) 10 CLR 243 Dixon v Australian Society of Accountants (1989) 95 FLR 231 Dorf Industries Pty Ltd v Toose (1994) 54 FCR 350 Edgar v Meade (1916) 23 CLR 29 Edwards v Society of Graphical and Allied Trades [1971] 1 Ch 354 Enderby Town Council Football Club Ltd v Football Association Ltd [1971] 1 Ch 591 Finnigan v New Zealand Rugby Football Inc [1985] 2 NZLR 159 Fisher v Keane [1879] 11 Ch 353 Forbes v New South Wales Trotting Club Ltd (1979) 143 CLR 242 Gaiman v National Association for Mental Health [1971] Ch 317 General Medical Council v Spakman [1943] AC 627 Hall v New South Wales Trotting Club Ltd [1977] 1 NSWLR 378 Harbottle Brown & Co Pty Ltd v Halstead [1968] 3 NSWR 493 Harrison v Hearn [1972] 1 NSWLR 428 Heatley v Tasmanian Racing & Gaming Commission (1977) 137 CLR 487 Hepples v Federal Commission of Taxation (1992) 173 CLR 492 Hornby v Narrandera Ex-Servicemen's Club Ltd [2001] NSWSC 235 John v Rees [1970] Ch 345 CASES CITED : Kioa v West (1985) 159 CLR 550 Law v National Greyhound Racing Club Ltd [1983] 1 WLR 1302 Lee v The Showmen's Guild of Great Britain [1952] 2 QB 329 Luu v Renevier (1989) 91 ALR 39 Macksville & District Hospital v Mayze (1987) 10 NSWLR 708 Makin v Gallagher [1974] 2 NSWLR 559 Malone v Marr [1981] 2 NSWLR 894 McInnes v Onslow-Fane [1978] 1 WLR 1520 McKinnon v Grogan [1974] 1 NSWLR 295 McNab v Auburn Soccer Sports Club Ltd [1975] 1 NSWLR 54 Minister for Immigration and Ethnic Affairs v Teoh (1995) 128 ALR 353 Mobil Oil Australia Pty Ltd v Federal Commissioner of Taxation (1963) 113 CLR 475 National Companies and Securities Commission v The News Corporation Limited (1984) 156 CLR 296 Parkes Rural Distributors Pty Ltd v Glasson (1986) 7 NSWLR 332 Preston v Carmody (1993) 44 FCR 1 R v Blizzard; ex parte Downs [1993] 1 Qd R 151 R v British Broadcasting Corporation; ex parte Lavelle [1983] 1 WLR 23 R v The Commonwealth Conciliation and Arbitration Commission; ex parte The Angliss Group (1969) 122 CLR 546 R v Criminal Injuries Compensation Board; ex parte Lain [1967] 2 QB 864 R v Disciplinary Committee of the Jockey Club; ex parte Aga Khan [1993] 1 WLR 909 R v Marks; ex parte Australian Building and Construction Employees and Builders Labourers Federation (1981) 147 CLR 471 R v Panel on Takeovers and Mergers; ex parte Datafin Plc [1987] 1 QB 815 R v Panel on Takeovers and Mergers; ex parte Guinness Plc [1990] 1 QB 146 R v Visitors to the Inns of Court, ex parte Calder [1994] QB 1 R v Wilson; ex parte Robinson [1982] Qd R 642 Rigby v Connol (1880) 14 Ch D 482 Russell v Duke of Norfolk [1949] 1 All ER 109 South Australia v O'Shea (1987) 163 CLR 378 Stininato v Auckland Boxing Association (Inc) [1978] 1 NZLR 609 Stone v Law Society (NT) (1992) 108 FLR 332 Sullivan v Department of Transport (1978) 20 ALR 323 Thorborn v All Nations Club (1975) 1 ACLR 127 Twist v Randwick Municipal Council (1976) 136 CLR 106 University of Ceylon v Fernando [1960] 1 WLR 223 Typing Centre of New South Wales v Toose (NSW Supreme Court, Mathews J, 15 December 1988, unreported) Victoria v Master Builders Association of Victoria [1995] 2 VR 121 Whittle v Australian Miniature Pony Society Inc, (1995) 57 FCR 252 Wood v Woad [1874] LR 9 Ex 190 DECISION : Expulsion resolution effective

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

5204/99 ROBERT FRANCIS McCLELLAND v BURNING PALMS SURF LIFE SAVING CLUB JUDGMENT 1 HIS HONOUR: Mr Robert McClelland first became a member of Burning Palms Surf Life Saving Club more than 40 years ago. From the time he joined, he was actively involved in carrying out beach patrols and in competitions between surf clubs. After 20 years or so his involvement in the more physically demanding activities of the Club was curtailed, but he continued to be involved in fundraising and in the administration of the Club. On 15 July 1995, a special general meeting of the Club resolved to expel him. In these proceedings, he contends that that expulsion was invalid, and seeks relief against it. The Fundraising Activities 2 The Club regularly conducted fundraising activities at the Mortdale Hotel. There was a meat tray raffle, which was conducted weekly and drawn on a Thursday evening from February to December. There was an "instant party" raffle conducted annually, near Christmas. As well, there was a "Mug of the Week" activity which was conducted weekly, and drawn on each Tuesday evening from February to December. 3 The "Mug of the Week" is a lucky number competition. A person who participates in the "Mug of the Week" pays two dollars each week that the competition is running. There is a tally sheet in the form of a grid, where each participant in the competition has a row of the grid allocated to him or her, and there is a column for each week that the competition is run. When someone pays to participate in the competition, a mark is made in the square of the grid which relates to that person, and the week for which payment is made. Sometimes, participants in the "Mug of the Week" were behind in their contributions; sometimes, they paid in advance. The winner, each week, was decided by the spin of a chocolate wheel. 4 In the latter part of 1994 and the early part of 1995, the Club's fundraising activities at the Mortdale Hotel were under the control of Mr Jack Ryan, who was then a Senior Vice President of the Club. Mr McClelland and Mr John Vaughan regularly assisted with fundraising at the Hotel. There was a table at the Hotel, at which Mr McClelland and Mr Vaughan frequently sat, as they collected the money. The usual practice was that as money was paid, an entry would be made on the tally sheet to record that it had been paid, and the money would be put into a moneybag, of which Mr McClelland retained custody. On a Thursday, Mr McClelland would give the contents of the moneybag to Mr Vaughan, for banking. 5 On a number of occasions - Mr McClelland estimates between eight and ten - he had borrowed money from the bag containing money collected for "Mug of the Week". Mr McClelland explained this, in a letter which he wrote to Mr Jacobs (the Secretary of the Club) on 29 April 1995: "It is no secret within the Club that my personal financial position has been difficult for some time. There have been a few times over the last couple of years when I did not have the ready cash to go to the pub. When those occasions have coincided with my fundraising activities for the Club I have borrowed from the kitty. This has been done with the knowledge and concurrence of the other members involved in those fundraising activities - Jack Ryan, Steve Singleton, and in particular John Vaughan - monies so borrowed have been small, recorded and repaid, usually fairly promptly. Furthermore, these borrowings have been solely to maintain my presence and fundraising for the Club." 6 Mr McClelland's practice, when he made such a borrowing, was that he made a note on a drink coaster of the sum he had borrowed, and kept that drink coaster with the moneybag. In about April 1994 he had a conversation with Mr Ryan, in which Mr Ryan said words to the effect of: "I know you have borrowed the Club's money a couple of times. That's between you and Rooster [John Vaughan]. Don't lose track of it." 7 Mr McClelland agreed. On most of the occasions when Mr McClelland borrowed money from the bag, he repaid it within a day or two. When he repaid the money, he tore up the coaster which recorded his borrowing. He says that, to the best of his knowledge, Mr Vaughan was aware of this practice. 8 In 1995, there was a period, starting in mid to late February of 1995, when Mr McClelland had become unemployed. He had made various borrowings from the "Mug of the Week" money at that time. He recorded his borrowings, in accordance with his usual practice, on a drink coaster, as a series of running totals. The drink coaster records "Bob owes", and a column of dollar amounts, all except the last of which is crossed out. This column of numbers represented the progressive total of his borrowings from time to time. The crossed out entries record amounts of $20, $60, $90, $115, $130, and $150. The amount not crossed out records $170. The money which was borrowed was mainly used to purchase beer for Mr McClelland's own consumption, while at the Hotel during the running of raffles. 9 At some time during March 1995, Mr Vaughan spoke to Mr McClelland about his borrowings from the kitty monies. Mr Vaughan knew that Mr McClelland was planning to go to Queensland at the time of the Australian National Surfing Championships, which were to be held in early April. Mr McClelland had told Mr Vaughan about the amount he had borrowed, and at first Mr Vaughan did not say anything about it. Then a couple of days later, he suggested that Mr McClelland should put a cheque in to cover the $170 while Mr McClelland was away, "… so if anyone went crook he could say, "I have a cheque" and I said, "I can't do that because I don't have a cheque account anymore".

It was on 27 March 1995 that Mr Vaughan asked Mr McClelland to put a cheque in. 10 There had been some disputes, the details of which were not explored in evidence, between Mr McClelland and the Club prior to this time. One of those disputes had resulted in the Club passing a resolution, on 18 January 1994, where it was resolved that Mr McClelland's membership be suspended from the date of the meeting until 30 November 1995. Mr McClelland instituted an appeal against that resolution, and the appeal process had not run its course by April 1995. 11 As well, an article had appeared in the Leader newspaper which concerned, in some way, Mr McClelland and the Club. The Club had written a letter, on 27 March 1995 (it is not clear to whom) concerning that article. Both Mr Vaughan, and Mr McClelland, knew about that letter written by the Club. Mr McClelland showed Mr Vaughan a draft of a reply which Mr McClelland proposed to send, concerning the article. Mr Vaughan asked that Mr McClelland do nothing, including sending his reply, until he returned from the Australian Championships in Queensland, around 9 or 10 April 1995. 12 On Monday 3 April Mr McClelland gave to Mr Vaughan copies of some letters which Mr McClelland had written, notwithstanding Mr Vaughan's request to do nothing, concerning the Leader article. Mr Vaughan did not read those letters at the time, but read them when he got home that evening. Mr Vaughan said, in a statutory declaration which he made in May 1995: "I considered that his actions in not giving me, or anybody else, a chance to put things right concerning the Club's letter negated any agreement we had and I saw no reason for giving him time to make things right with the "Mug" money. I told him on the phone I considered the money due now." 13 The next morning, 4 April 1995, Mr McClelland phoned Mr Jacobs, who was then the Honorary Secretary of the Club. He told Mr Jacobs that he owed the "Mug of the Week" $170, and that Mr Vaughan had demanded that he pay it back before he went to Queensland. Mr McClelland told Mr Jacobs in any event the Club owed him money, for half the value of a surfboat trailer, a gas bottle, and a fire extinguisher. Mr McClelland told Mr Jacobs that he had to go to Queensland, and he needed what money he had for that. He explained that he was able to travel with a friend to get to Queensland, would stay at the Surf Club, but still needed money to be able to eat and drink. He said that the Club could wait until he got back. 14 Mr Jacobs says that he said to Mr McClelland, "Bob you cannot take the raffle money. It's not right. And you know that the Club disputes your position on the other matters." Mr McClelland says he cannot recollect Mr Jacobs saying, "You cannot take the money. It's not right". It seems to me more likely than not that Mr Jacobs did make such a statement. It was Mr Ryan and Mr Vaughan, not Mr Jacobs, who knew about Mr McClelland's previous borrowings from the "Mug of the Week" money. The response which Mr Jacobs attributes to himself in evidence, is just the sort of response one would expect someone, told the story for the first time, to give. Mr Jacobs struck me in the witness box as being a cautious man, and the response he attributes to himself is consistent with that. Further, Mr McClelland does not actually deny that Mr Jacobs said those words. 15 On 11 April 1995, Mr McClelland gave the drink coaster, containing his record of borrowings, to Steve Singleton, the Assistant Treasurer of the Club. 16 On 14 April, Mr Vaughan wrote to the Committee of the Club, setting out his account of the circumstances concerning Mr McClelland's borrowing. That letter raised some concerns besides the borrowing of $170. First, Mr Ryan recollected that he had had a conversation with Mr McClelland, about 10 days before, when Mr McClelland had said something about $200, and Queensland. Mr Vaughan's letter continued: "… I told him that I could not authorise or condone his use of Club money and that he should talk to Jack Ryan. I did not think about it any more until the matter of the $170 was raised. The two amounts did not make sense as the second sum was smaller than the first and it seems unlikely that he would need less than he did 10 days before." 17 Second, Mr Vaughan said that he had checked the bankings he had made, and found that up to March 2, the deposits appeared normal, but that the deposits for weeks commencing March 9 to 30 were below the average. Mr Vaughan reported that on 4 April, Steve Singleton, "did a quick reconciliation and was of the opinion, since mid January, the banking could be in the vicinity of $700-plus short. He has since done a detailed study and has confirmed that there is a substantial shortfall." 18 Mr Vaughan also said, in this letter: "I have since recalled two other incidents that Bob mentioned but I have no knowledge of whether these matters were resolved. · Bob made a loan to a friend who was "a bit short" of $20. He said that he did not have spare cash himself at the time. · He told me that he had collected $50 one Friday night and had mislaid it over the weekend." 19 Mr Vaughan also said: "At no time have I given permission for Bob McClelland to use "Mug" money for any purpose." 20 On 18 April there was a committee meeting of the Club. Standing Orders were suspended to discuss the situation concerning the "Mug" money. A motion was passed. "a.1) That letter be sent to R F McClelland requesting he attend a meeting of the Committee in accordance with Rules No's. 15.1 & 15.3 a.2) That the letter be prepared by the honorary solicitor for the hearing." 21 On 20 April Mr McClelland went to the Mortdale Hotel, and was told by Mr Ryan that he had been relieved of raffle duties. Mr Ryan mentioned something about improper use of Club funds. Mr McClelland said something like, "It's going to look rather funny to the boys if I walk away right now." Mr Ryan agreed, and they ran the raffles as usual. 22 On 29 April 1995 Mr McClelland wrote to Mr Jacobs. His letter contained a little over six pages of typed, single space text. He gave details of what he said were irregularities committed by other people in the Club concerning the handling of money. He referred to what he said were other errors, of Club officials, which had resulted in the Club paying too much for a surfboat, and losing a federal government grant to purchase premises. Concerning the borrowing of Mug money, he made the statement I have set out at paragraph 5 above. He continued: "Under these circumstances I do not believe any court would find anything wrong with my actions and I challenge anyone who thinks otherwise to do something about it. More recently, my position has worsened and I have advised those concerned that I would not be able to continue but that I would hold the fort until the Australian Championships after which others would have to take over. It is a Pyrrhic victory for the committee to relieve me of these duties when I have already quit, and when you will be hard put to find a replacement who will give the service I have given. Nonetheless, I consider this action to be a gross and unwarranted insult and I demand and expect an immediate retraction and apology. It is poor thanks for 35 years and tens of thousands of dollars raised over those years." 23 He went on to threaten defamation actions, accuse the committee of having a "hidden agenda" and give details of the claim which he said he had against the Club, for an amount $849.40, relating to the boat trailer, gas cylinder and fire extinguisher. He also mentioned some other matters of dispute which he had with the Club. 24 On 30 April, Mr McClelland wrote to the Department of Gaming and Racing. That Department administers the Charitable Fundraising Act 1991. The letter was not in evidence, but from the reply I infer that he informed the Department about his suspension from the Club, his borrowings from the raffle monies, and raised questions about the validity of the Rules of the Club. 25 On 1 May 1995, there was a further committee meeting of the Club. The minutes record the following: "3.6 Assistant Treasurer advised an analysis of the "Tick Sheets" that record patrons payments for the "Mug of The Week" raffle. The shortfall in raffle money that amounted to $170 occurred in the period 24/1/95 to 11/4/95. 3.7 Further discussion was held on the action that may be undertaken and the timing to undertake this action. Secretary pointed out any action should be strictly in accordance with the rules. It is not in the clubs interest to undertake any action on this matter that is not entirely within our rules. The Rules 15 & 16 provide for the dealing with the discipline and for members to appeal, it is important that the timing as required by the rules is followed. Moved J Vaughan/D McAlpine that any letters or resolution on this matter should be forwarded to Burning Palms legal adviser to ensure action is correct and strictly in accordance with Burning Palms rules ………..carried. Moved J Vaughan/J Culbert that club members J Vaughan, S Singleton, D Jacobs, J Ryan and B Traynor submit to the club Statutory Declarations before any letters are sent to R F McClelland …………carried. 3.8 It was agreed by all present that this matter should be referred to the clubs honorary solicitor P Terrett and any subsequent correspondence. This will ensure that all correct procedures are strictly adhered to." 26 On 3 May, the Department of Gaming and Racing wrote to Mr McClelland. The thrust of the letter was that the Department could not help him with most of the matters about which he had written on 30 April 1995. The Department did say, however: "Nevertheless, your 'borrowings' from the raffle 'kitty' may contravene section 20(6) of the Charitable Fundraising Act which states in part that 'any money received in the course of a fundraising appeal, before the deduction of any expenses, is to be paid immediately into an account at a bank or building society …" 27 Also on 3 May 1995, the Department wrote to the Club, enclosing a copy of the letter it had written to Mr McClelland. The covering letter to the Club said: "I would draw your attention to references to the current reporting requirements on changes to your Club's constitution, and also the need to bank the gross proceeds from a fundraising appeal without deduction into a bank or building society account. Under the circumstances I would be grateful if you would advise the Department of the circumstances surrounding Mr McClelland's 'borrowings' from the proceeds of fundraising raffles, and the controls and procedures applying to the conduct of such raffles." 28 On 16 May 1995 there was a further committee meeting of the Club. Mr McClelland was given no notification that this meeting would be held, and did not attend it. At that meeting, Mr Jacobs tabled a Supplementary Agenda, and four statutory declarations. The Supplementary Agenda contained the following items: "1. Consideration of the factual matters set out in the Statutory Declarations referred to in the Schedule to this Agenda, copies of which Statutory Declarations have been circulated with this Agenda, in relation to the involvement of R F McClelland in the "Mug of The Week" fundraising raffle at Mortdale Hotel. 2. Consideration of, and if thought fit, passing as Resolutions, Motions as follows:- ' That the actions of R F McClelland in having:- (a) collected monies from patrons of Mortdale Hotel ("Raffle Monies") in relation to the "Mug of the Week" fundraising raffle of Mortdale Hotel ("Raffle") on behalf of Burning Palms Surf Life Saving Club; and (b) failed, without proper reason, to account to the Club for Raffle Monies totalling approximately $170.00 collected by him on or between the following dates: 24 January 1995, 31 January 1995, 7 February 1995, 14 February 1995, 21 February 1995, 28 February 1995, 7 March 1995, 14 March 1995, 21 March 1995, 28 March 1995 and 4 April 1995. be considered to be persistent and wilful actions prejudicial to the interest of the Club. 2. That R F McClelland be expelled from membership of the Club pursuant to rule 15.1 for having acted persistently and wilfully in a manner prejudicial to the interests of the Club. 3. That R F McClelland be advised of his expulsion of the Club pursuant to rule 15.1 and that he be advised of his right of appeal against the expulsion decision pursuant to rule 16.' Schedule Name of Declarant John Kendall Vaughan John George Ryan Donald Charles Jacobs Stephen David Singleton" 29 The four statutory declarations were from the four people named in the schedule to the agenda. Mr Vaughan's statutory declaration was identical in text (apart from the formal parts appropriate to a statutory declaration) to his letter of 14 April 1995. 30 The statutory declaration of Mr Steve Singleton was in the following form: "On Monday evening 3 April 1995, Robert McClelland told me something. He had just returned from a telephone conversation with John Vaughan when he stated: "Rooster has just told me to pay back the money I borrowed from the Mug of the Week before I go to Queensland, …" Robert also said something like I can't do that now. This was the first time that I was aware that Robert had "borrowed" money from the Surf Club takings on this occasion. Robert had previously borrowed up to $50.00 to "see him through a couple of days" until he was paid. Although not strictly correct procedure and never authorised, this has been condoned. On Tuesday morning 4 April 1995 I received a phone call from John Vaughan, where he told me something. John said he was concerned about the money collected for the Mug of the Week. John indicated he believed that two amounts had not been offered for banking by Robert McClelland. The first amount of $200.00 which was due for banking about 23 March 1995 and the second amount was $170.00 which was due for banking 30 March 1995 and on 4 April 1995. On the evening of 4 April 1995, I attended the Mortdale Hotel where I took possession of the records for the Mug of the Week and was given a list of amounts banked from January to April 1995 by John Vaughan. In the presence of John Vaughan, I performed a preliminary reconciliation of the records to the banking. At this time I informed John that an amount exceeding $400.00 appeared to be unaccounted. Later that evening I performed a detailed reconciliation and am satisfied that an amount of $739.00 has not been accounted for. The reconciliation was performed using the following given data. The records for the mug established a status as at 24 January 1995. From the same sheet it was possible to establish a status as at 4 April 1995, a list of amounts banked was extracted from the bank deposit slips. (see attached) Given that John Vaughan can account for $370.00 as amounts mentioned by Robert McClelland, there is an unaccounted shortfall of $369.00 In a phone conversation with Donald Jacobs, on Wednesday 5 April 1995, Don indicated he had a conversation with Robert McClelland regarding the "loan of Mug Monies" on the previous day. On Tuesday 11 April 1995 at approximately 6.00 PM at Mortdale Hotel, I spoke to Robert McClelland and advised him that I had performed a reconciliation of the Mug of the Week and the banking records of the club. I advised Robert McClelland that an amount of $739.00 could not be accounted for. Robert McClelland admitted he had taken $170.00 over the period of the last several weeks, "to maintain my presence in the pub". Robert offered that he knew of one instance where $50.00 had been lost by him during a collection week. Robert handed over cash amounting to $46.00 relating to the week collection up to 4 April 1995. Robert had no explanation of other monies missing from the Mug of the Week. I spoke to Don Jacobs on 12 April 1995 where he indicated he did not give permission or approval in any form to Robert McClelland in relation to the $170 "borrowed". On Thursday 13 April 1994 I spoke to Brad Traynor. He indicated that Mr McClelland had attempted to contact him on Tuesday 4 April 1995 without success. I advised Brad of the unaccounted funds from the Mug of the Week to an extent of approximately $730. It is my opinion that Mr Robert McClelland did over a period of time take $170.00 without the authorisation of the Management Committee of the Burning Palms Surf Lifesaving Club. I believe that the following scenarios could account for the remaining $434.00 which remains unaccounted: 1 Person or persons unknown have entered marks on the record without paying the appropriate fee on up to 185 occasions. 2 Monies collected were lost prior to being offered for banking. 3 Clerical Errors were made in recording payments on up to 185 occasions. 4 Monies were offered for banking but were not banked. 5 Monies collected by Robert McClelland are currently in his possession. 6 Monies collected by Robert McClelland were held by him for his use. 7 A combination of more than one of the above. I brought the matter to the attention of the next available meeting of the Burning Palms Surf Lifesaving Club Management Committee on 18 April 1995." 31 Mr Ryan's statutory declaration said: "… at no time did I, as Senior Vice President of Burning Palms Surf Life Saving Club and the Officer in charge of fundraising at the Mortdale Hotel give ROBERT McCLELLAND permission to use $170 or any other moneys of the Club's funds which he collected for the "Mug of the Week" for his own use. On the odd occasion, he may have mentioned that he had borrowed a small sum from these moneys, but I cannot remember any specific details of these instances." 32 Mr Jacobs' statutory declaration stated the following: "On Tuesday 4 April, 1995 prior to departure to the Australian Titles R F McClelland rang me to ask the telephone number of B Traynor. During the discussion when he also advised there would be further letters sent to Sydney Branch. In addition, advised that he had taken $170 from the raffle money required to help pay expenses to go to the Australian Titles. Also stated that the Club owed him half the value of a boat trailer, one fire extinguisher and a 20 kg gas bottle." 33 The minutes of the committee meeting of 16 May 1995 record: "The meeting discussed and considered the factual matters set out in the statutory declarations and the motions set out in the supplementary agenda. Following such consideration and discussions, motions were moved by J Ryan, seconded by D McAlpine and unanimously passed as resolutions by the meeting: [there followed the text of the three motions contained in the Supplementary Agenda]. 34 The minutes also noted, under the heading "General", correspondence received and sent: "10.11 Letter Dept. of Gaming and Racing dated 3/5/95 requesting the club advise on the borrowing from "the proceeds of fundraising raffles" and our controls and procedures that are in place to monitor conduct of the raffles. 10.12 Copy of letter dated 3/5/95 sent to Mr R F McClelland in answer to a letter that I assume was Mr R F McClelland's letter of 29/4/95. 10.13 Letter dated 4/5/95 from J Vaughan setting out the history on the boat trailer that Mr R F McClelland claims the club owes an amount against. 10.16 Letter dated 19/4/95 J Vaughan's answer to letter received from Mr R F McClelland of the 12/4/95. 10.17 It is noted letters from Mr R F McClelland dated 7/2/95, 2/4/95 and 29/4/95 acknowledged." 35 Thus, Mr McClelland's letter of 29 April 1995 was before that meeting. 36 By a letter dated 25 May, which Mr Jacobs actually signed on 27 May, Mr McClelland was informed as follows: "On 16 May 1995 the Committee of Burning Palm Surf Lifesaving Club Inc ("Club") passed certain resolutions concerning your membership of the Club. The exact Resolutions passed by the Committee on that occasion concerning your membership are set out in the Schedule to this letter. In short, it was resolved that you be expelled from membership of the Club pursuant to Rule 15.1 of the Club's Rules for having acted persistently and wilfully in a manner prejudicial to the interest of the Club. Pursuant to Rule 15.3 we now give you written notice of the Resolutions passed by the Committee and the grounds upon which they are based. Pursuant to Rule 15.3(b) you are entitled to address the Committee at a meeting to be held not earlier than fourteen (14) days and not later than twenty eight (28) days after service of this letter on you. Please be advised that the Committee has scheduled a meeting on the date and at the place and time set out below at which you may address the Committee regarding the Resolutions which have been passed: Date: 13 June 1995 Place: Meeting Room, St George Masonic Club Limited, 86 Roberts Avenue, Mortdale Time: 8.00pm In relation to the meeting, particulars of which are set out above we draw your attention to the following matters:- 1. You are not entitled to legal representation at the meeting; 2. You may attend and speak at the meeting; and 3. you may submit to the Committee at or prior to the date of that meeting written representations relating to the Resolutions which have been made. Your attention is drawn to the provisions of Rules 15 and 16, a copy of which is enclosed with this letter. 37 A schedule to the letter set out the text to the resolutions which had been passed. A copy of Rules 15 and 16 was enclosed. 38 On 26 May 1995 the Club wrote to the Department of Gaming and Racing, replying to the Department's letter of 3 May 1995. It stated the current procedures concerning the handling of money. Under the heading "McClelland 'borrowings'", the letter said: "The so called "borrowings" by Mr McClelland were clearly unauthorised by the Club. They contravene the Club's money handling procedures and it is the Club's position that the "borrowings" amount to unlawful misappropriate of monies by Mr McClelland. At a meeting of the Committee of the Club held on 16 May 1995 it was resolved that Mr McClelland be expelled from membership of the Club for having failed, without proper reason, to account to the Club for raffle monies apparently collected by him between 24 January 1995 and 4 April 1995. The Schedule to this letter sets out the Resolutions which were passed by the Committee on 16 May 1995 concerning Mr McClelland and his "borrowings". Please let us know should you require any further information. We have requested Mr McClelland to forthwith account to the Club for the $170.00 which, we believe, he has collected from the patrons of Mortdale Hotel in relation to the Club's "Mug of the Week" fundraising raffle on behalf of the club but for which he has failed to account." 39 On 4 June 1995 Mr McClelland wrote to Mr Jacobs. The first point he made was that the resolutions of 16 May were invalid because certain provisions of the model rules, under the Associations Incorporation Act 1984, had not been complied with. He reminded Mr Jacobs that for officers or members of an incorporated association to contravene a provision of the Act or regulations was a criminal offence. His letter continued: "… Notwithstanding the above, I shall address your resolutions: 1. (a) I have indeed collected monies from the Patrons of the Mortdale Hotel; and elsewhere over the years, on behalf of the Club. Many thousands of dollars in fact which is a damn sight more than most of the Committee have done. (b) To say that I have "failed to account to the Club for Raffle Monies totalling approximately $170" is, quite simply, false. I draw your attention to the Macquarie Dictionary: "account - A verbal or written recital of particular transactions and events" It is precisely because I have accounted to the Club for Raffle Monies totalling exactly $170 that you are aware that I have borrowed that amount. There is nothing underhand or dishonest in my actions and to imply that there is, as the Committee has done in its resolutions, is an act of pure and unmitigated bastardry! I draw your attention to my letter of 29 April and in particular: "It is no secret within the Club that my personal financial position has been difficult for some time. There have been a few times over the last couple of years when I did not have the ready cash to go to the Pub. When those occasions have coincided with my fundraising activities for the Club I have borrowed from the kitty. This has been done with the knowledge and concurrence of the other members involved in these fundraising activities - Jack Ryan, Steve Singleton and, in particular, John Vaughan - monies so borrowed have been small, recorded and repaid, usually fairly promptly. Furthermore, these borrowings have been solely to maintain my presence and fundraising for the Club." I do not accept that this action was, in any way, "prejudicial to the interests of the Club". In fact the reverse was the case. I have collected substantial sums for the Club, which I would not otherwise have collected. Previous such borrowings have been repaid, as this would have been by now were it not for your actions. Also if you take into consideration the Club's debt to me, the $170 was and is well and truly covered. However, if you consider my action to be in some way improper, then what of Jack Ryan who is in charge of our activities at Mortdale Hotel and who was aware, although not in detail, of this practice; and what of John Vaughan who is responsible for taking and banking the monies collected and who was aware of both the practice and the details. Surely, if I am guilty of any impropriety, then they with their greater responsibilities and authority are even more guilty. Is there any suggestion that they should be expelled? Of course not! And neither should there be, for them or me. Again I refer you to my letter of 29 April: "Your actions are petty, vindictive and grossly hypocritical . They are not about improper use of funds or a lousy $170. They are about punishing me for my letters of 2 April and yet some of your have the hide to accuse me of having a hidden agenda. My agenda is not hidden; it is simply to clear my name, totally and absolutely, and you had better believe that it is going to happen, one way or another, preferably within Surf Life Saving but if not, then within the Courts." Your hypocrisy is compounded by the fact that the Club's debt to me - spelt out in my letter of 29 April - is 5 times greater and substantially older than my debt to the Club. The Committee should be ashamed and should apologise!" 40 On 7 June 1995, Santow J was the Equity Duty Judge. An Associate's Record of Proceedings, relating to proceedings "R F McClelland v Burning Palms S L S C, Sydney Branch Surf Life Saving" records that Mr McClelland appeared in person that day, and that someone called A David appeared for one or other (or perhaps both) of the intended defendants. The matter occupied his Honour for 15 minutes, and resulted in a direction "I stand the matter down so that it should come before me at 10.00am on 14 June 1995". It seems likely that his Honour was informed about the committee meeting being fixed for 13 June 1995, and took into account that whatever happened at that meeting might well affect what, if any, orders it might be appropriate to make. Mr McClelland says that Santow J directed him to "serve the documents in the meantime". 41 On 13 June 1995 there was a further committee meeting of the Club, which Mr McClelland attended. The Club's honorary solicitor, Mr Terrett, also attended. The minutes of that meeting record the following: "R F McClelland-Expulsion Decision The Chairman noted that R F McClelland been invited to attend the meeting in order to make oral representation concerning the decision made by the committee on the 16th May, 1995 that he be expelled from membership of the club. Mr R F McClelland arrived at 7:56pm and:- a) made various statements concerning matters before Sydney Branch of SLSA; and b) Read the contents of his letter to the Club dated 4 June, 1995. The Chairman made a ruling that certain materials set out on pages 1, 2 & the first half of page 3 of R F McClelland's letter of 4th June, 1995 were not relevant to the Committee's present deliberations and would not be considered for the purpose. R F McClelland withdrew from the meeting at the Chairman's request at 8-05pm (for approximately 7 minutes) and also during the meetings recess between 8-20pm and 8-25pm. After advising the Chairman that he had nothing further to add to his submissions R F McClelland withdrew permanently from the meeting at 8-50pm. The meeting subsequently discussed the matters which had been raised by R F McClelland. Following such discussion it was moved by J Vaughan, seconded by D Jacobs and unanimously carried as Resolutions. a) "That the Committee hereby confirm its decision passed at the Committee Meeting of 16th May, 1995 that R F McClelland be expelled from membership of the Club pursuant to Rule 15.1 for having acted persistently and wilfully in a manner prejudicial to the interests of the Club"; and b) "That the Club Secretary be requested and directed to send R F McClelland a letter pursuant to Rule 15.5 advising R F McClelland of the Committee's confirmation of the expulsion decision made on 16th May, 1995 and advising him of his rights of appeal to the members in general meeting pursuant to Rule 16."" 42 The portion of Mr McClelland's letter of 4 June 1995 which the Chairman ruled not relevant, was the portion where Mr McClelland made allegations about failure to comply with provisions of the model rules, and the Associations Incorporations Act. 43 Mr McClelland accepted the proposition, in cross-examination, that when he received the letter from the Department dated 3 May, "it is very difficult to see how your borrowing from the kitty would not be in contravention of the Act". As well, Mr McClelland had had a conversation with someone at the Department, before he received that letter, in which he was told that his borrowing was "maybe in contravention of the Act". 44 At the committee meeting on 13 June, Mr McClelland read to the committee the whole of the portion of his letter of 4 June which I have earlier quoted (see paragraph 39). At that meeting, Mr Phillips, the then President of the Club, asked him whether he was going to repay the $170. Mr McClelland made quite clear that he would not repay it. 45 In cross-examination, Mr McClelland accepted that at the committee meeting held on 13 June he was asked whether he had anything further to say, and said that he had nothing further to say. 46 On 14 June 1995, Mr McClelland appeared, ex parte, before Santow J. He filed that day, a document called a Statement of Claim, which was really more akin to a summons - it stated the orders he sought, without alleging the basis on which those orders were sought. The orders were: "1 An order that the defendant be restrained from holding its annual general meeting until such time as all the matters disputed between the plaintiff and the defendant are properly resolved. 2 An order that the defendant supply to the plaintiff copies of all and any allegations written or supply me with particulars of allegations verbally made against him and copies of all and any resolutions passed by the defendant pertaining to the plaintiff. 3 Such other orders as the court deems fit." 47 His Honour made an order which, amongst other things, made clear that any appeal which Mr McClelland exercised should be dealt with in accordance with the requirements of natural justice. 48 On 19 June 1995, Mr Jacobs wrote to Mr McClelland, saying: "This letter is to confirm that:- 1. On 16 May 1995 the Committee of Burning Palms Surf Lifesaving Club Inc (" Club " resolved that you be expelled from membership of the Club pursuant to Rule 15.1 of the Club's Rules. 2. On 13 June 1995 the Committee of the Club heard your oral submissions and considered your written submission concerning its decision made on 16 May 1995. 3. After careful consideration the Committee decided, pursuant to Rule 15.4, to confirm its decision made on 16 May 1995. As a consequence your expulsion from membership of the Club has been confirmed. You have a right of appeal against the Committee's decision made on 16 May 1995 as confirmed on 13 June 1995. That appeal is to the members of the Club in general meeting and may be exercised pursuant to Rule 16.1. A copy of Rule 16 of the Club's Rules is attached for your ease of reference." 49 On 25 June 1995, Mr McClelland wrote to Mr Jacobs saying: "I appeal against the committee's decision of 16 May 1995." 50 Mr Jacobs issued a notice calling a general meeting of the Club. The notice was in the following form: "NOTICE OF GENERAL MEETING Notice is hereby given of General Meeting of Burning Palms SLSC Inc to be held on Saturday 15 July, 1995 at 2pm at the St George Budapest Soccer Club, Regency Room 84 Victoria Ave, Mortdale. BUSINESS The meeting has been called pursuant to Rule 16 of the Club rules so that the members in General meeting can hear an appeal by Robert F McClelland against resolution of the Committee passed on 13 June, 1995 (pursuant to Rule 15.4) ("Expulsion Resolution") confirming an earlier resolution of the Committee passed on 16 May, 1995. Details of the relevant resolutions are set out below for the reference of members. The members present at the meeting will be asked:- (a) to vote whether the Expulsion Resolution should be confirmed or revoked; and (b) to vote for or against a Special Resolution in favour of confirmation of the Expulsion Resolution. RESOLUTIONS PASSED BY THE COMMITTEE ON 16 MAY 1995 1. That the actions of R F McClelland in having:- 1.a) collected monies from patrons of Mortdale Hotel (RAFFLE MONIES) in the "Mug of The Week" fundraising raffle of Mortdale Hotel (RAFFLE) on behalf of Burning Palms Surf Life Saving Club; and 1.b) failed, without proper reason, to account to the Club for Raffle Monies totalling approximately $170.00 collected by him on or between the following dates: 24 January 1995, 31 January 1995, 7 February 1995, 14 February 1995, 21 February 1995, 28 February 1995, 7 March 1995, 14 March 1995, 21 March 1995, 28 March 1995 and 4 April 1995 be considered to be persistent and wilful actions prejudicial to the interests of the Club. 2. That R F McClelland be expelled from membership of the Club pursuant to Rule 15.1 for having acted persistently and wilfully in a manner prejudicial to the interests of the Club. 3. That R F McClelland be advised of his expulsion from the Club pursuant to Rule 15.1 and that he be advised of his right of appeal against the expulsion decision pursuant to Rule 16. RESOLUTIONS PASSED BY THE COMMITTEE ON 13 June 1995 4. "That the Committee hereby confirm its decision passed at the Committee Meeting of 16th May, 1995 that R F McClelland be expelled from membership of the Club pursuant to Rule 15.1 for having acted persistently and wilfully in a manner prejudicial to the interests of the Club"; and 5. "That the Club Secretary be requested and directed to send R F McClelland a letter pursuant to Rule 15.5 advising R F McClelland of the Committees confirmation of the expulsion decision made on 16th May, 1995 and advising him of his rights of appeal to the members in general meeting pursuant to Rule 16." Notes : 1. Pursuant to Rule 16.2: (a) this general meeting was required to be held within twenty-one (21) days after the Secretary received notice from R F McClelland against the Expulsion Decision. (Notice to this effect was received on 25 June, 1995); and (b) all members were required to be given at least seven (7) days notice of the matter to be dealt with at the meeting. 2. For a resolution to be passed as a Special Resolution it is necessary, as a minimum, that it be proposed as a Special Resolution and that it be passed by a majority which comprises not less than three-quarters of the members who, being entitled to vote at the meeting, do actually vote at the meeting in favour of the Special Resolution. 3. Copies of Rules 15 and 16 are attached for your reference." 51 Though the notice is undated, I would infer that it was given promptly after Mr McClelland's letter dated 25 June 1995 exercising his right of appeal, was received. 52 On 14 July 1995, Mr McClelland appeared before Brownie J. Though a wider variety of claims were made, his Honour dealt only with those which needed to be resolved that day. These his Honour summarised as being a claim "to restrain the holding of the meeting tomorrow, or perhaps to restrain the passing of a resolution confirming the resolutions of the committee" and "the plaintiff's claim that he be given documents in connection with that meeting tomorrow". His Honour considered, and rejected, a submission that the rules of the Club were inconsistent with those required under the Associations Incorporation Act 1984. This was the only basis upon which the claim to restrain the holding of the meeting was made. His Honour then continued: "Turning then to the question whether the plaintiff is entitled to be given any document in relation to tomorrow's meeting, the evidence establishes that on 25 May the Club secretary wrote to the plaintiff giving him notice of the meeting of the committee to be held on 13 June, informing him in a schedule to that letter of the precise allegations made against him and setting out a procedure to be followed. Those allegations contained a considerable amount of detail, and there has been no complaint about that detail. He has also been given a letter dated 19 June, advising him of the resolution of the committee of 13 June, advising him of his appeal rights and enclosing copies of the relevant club rules. Presumably in response to that the plaintiff wrote to the Secretary of the Club on 25 June, in effect giving notice of appeal. The notice of the meeting convened for tomorrow repeats the same particulars of the allegations made against the plaintiff. There is no question but that the plaintiff is entitled to be told of the allegations made against him. As I see it at the moment, the notices and letters to which I have referred do just that. The existing injunction granted by Santow J seems to be sufficient to mean that if there is any deficiency in those particulars, then the defendant should cure that deficiency. I do not know however what the supposed deficiency is. As I understand him, the plaintiff does not know either, but suspects or fears that or wonders whether there might be something he has not seen. If I am asked to rule as to whether any particular document should be made available to the plaintiff before tomorrow's meeting I will deal with that application. For the moment, however, subject to that possibility, I decline to grant any interlocutory relief today. I will adjourn the case to a date to be fixed. (His Honour directed the plaintiff to advise the defendant of the precise document which the defendant had not produced yet and if there were any dispute, the matter to be mentioned at 2.30)" 53 At 12.45pm on 14 July Mr Jacobs gave Mr McClelland the Supplementary Agenda for the committee meeting of 16 May 1995. At about 7.30pm on 14 July, Mr Jacobs gave Mr McClelland copies of the four statutory declarations which were referred to in the Supplementary Agenda. Mr McClelland gave the following evidence: "A. I received the statutory declarations in the pub the night before and I wasn't exactly sober. I did try and read them that night and hence a lot of handwritten comments on one of them that I should not have put there. So I went over them again the next morning and I attended the local police station to seek some advice that might be available to me on a Saturday morning." 54 The General Meeting took place on 15 July 1995. The minutes of the meeting are as follows: "Minutes of The General Meeting held at St George Budapest Soccer Club, 84 Victoria Ave, Mortdale on Saturday 15 July 1995 at 2pm. 1 Attendance: As per the attendance sheet dated 15/7/95 (copy of which comprises Attachment No.1) with thirty four financial members in attendance. 2 Business of Meeting: As set out in the Notice of General Meeting referred to in Attachment No.2. No other business was discussed or presented to the meeting as required by the Rule 16.3 to hear the members appeal under discipline. BUSINESS OF THE MEETING AS PER NOTICE 3.1 President opened the meeting and requested all members be seated and advised the nature of the meeting in referring to the Attachment No. 1. the Notice of General Meeting. 3.2 It was moved by G Phillips and seconded by R Daley that the resolutions as stated in the Notice of General Meeting for the 15 July 1995 be put to the meeting in accordance with Rule 16. 3.3 Scrutineers S Singleton and B Gray of Sydney Branch handed out ballot papers. The Chairman requested all financial members eligible to vote to mark papers in either yes or no box on the ballot paper, fold and pass to one of the scrutineers. 3.4 Votes result was: Resolution (a) was passed by the meeting in the affirmative. Resolution (b) was passed in the affirmative as a Special Resolution by more than 75% of those present and voting. 3.23 J Ryan moved and was seconded by S Strange that a vote of thanks be recorded to the Secretary D Jacobs and our Legal adviser P Terrett …… carried by acclamation. 3.23 It was moved by G Phillips and seconded by C Fogwell that the meeting should now close at 16:18pm …… carried. 55 At the meeting on 15 July Mr McClelland read out portions which he chose from his letters of 29 April 1995 and 4 June 1995. He also read portions which he chose from the statutory declarations. The statutory declarations had not been made available to the members of the Club as a whole, though the committee members who were present on 16 May would, of course, have seen them. Mr McClelland accepts that he spoke for somewhere between 30 and 60 minutes at that meeting, "in bits and pieces". 56 There was a time, in the meeting, when a member, Mr Keith Ebdon, asked Mr McClelland a question concerning repayment of the money. There are differing accounts in the evidence about the precise question which was asked. In his affidavit, Mr McClelland said that the question concerned whether he had repaid the $170. Mr Jacobs' evidence is also that Mr Ebdon's question concerned whether Mr McClelland had repaid the $170. Mr Miller likewise recollects that Mr Ebdon's question was whether Mr McClelland had paid the money back. Mr Phillips' recollection is that Mr Ebdon's question was whether Mr McClelland would pay the money back. Having seen Mr Phillips cross-examined, I do not have a great deal of confidence in his recollection of details of that meeting. However, more importantly, in cross-examination Mr McClelland said that Mr Ebdon had asked "had I and was I going to repay". 57 There is a consensus amongst these witness (apart from Mr McClelland) that the answer which Mr McClelland gave to Mr Ebdon's question was "No". Mr McClelland says that he did not say "No" in response to that question, but in this respect I reject his evidence. 58 I am satisfied that at the meeting, Mr McClelland made the substance of his position concerning the $170 known, namely, that he had borrowed the money, had not repaid it, and was not going to repay it because he had a cross-claim against the Club for more than that amount. Mr Cane, a witness called by Mr McClelland, recollected Mr McClelland saying words to the effect of "No, I have a cross-claim against the Club". As well, that was Mr McClelland's actual position at the time, and there was no reason why he should not explain it to the meeting. 59 The meeting was one where there were some interjections and interruptions. Mr Jacobs described it as, "a lively and rather emotion-packed meeting". There was an occasion when Mr Phillips spoke over Mr McClelland. There were some other topics, besides the $170, which arose during the course of the meeting. At one time Mr Strange (a Club member with whom Mr McClelland had a dispute going back to 1988) complained about Mr McClelland not having apologised to him about those matters. There was an interjection from someone who wondered aloud what sort of an act it was for Mr McClelland to write to the Department asking them to investigate the Club. Mr Ryan at one stage interrupted Mr McClelland by saying, "We are not a bloody bank!" When Mr McClelland was commenting on Mr Vaughan's statutory declaration, Mr Vaughan interrupted asking, "Is Mr McClelland saying that I lied under oath." However, I am not satisfied that there was such disruption at the meeting as to prevent Mr McClelland from communicating effectively the substance of what he wanted to say. Mr Bill Singleton (who was, in mid 1995, the President of the Sydney Branch of the Surf Life Saving Association of Australia, and who was not a member of the Club) attended the meeting to assist with the count of votes. While his recollection of his detail of the meeting had faded in some respects, he gave evidence that, "… he got a very good hearing, I thought." 60 There was one Club member, Alan Nelson, who spoke at the meeting in support of Mr McClelland. 61 At the meeting, Mr McClelland referred to his recording the borrowings on the beer coaster, said that he had never made any secret of having taken the money, and that recording the borrowings on the beer coaster amounted to "accounting for" the money. Mr Terrett stated, while Mr McClelland was making his submission, that the coaster was not, legally, a proper account of the monies, and should not be considered by the members as Mr McClelland having accounted for the $170. 62 I have earlier mentioned that Mr Bill Singleton was present at the meeting, although not a member of the Club. He and Mr Bill Gray, the Deputy President of the Sydney Branch of the Surf Life Saving Association, had been asked to attend the meeting to supervise the conduct of the ballot. They followed a procedure where they distributed a piece of paper to each member present. Members were asked to mark on that ballot a "Yes" or a "No" to indicate how they voted. When the members had finished writing, Mr Singleton and Mr Gray collected the ballot papers, making sure that they received back the same number of pieces of paper as they had given out. They retired to the back of the hall, where they counted the votes. The procedure that they adopted was to work out, in advance, what number of votes was needed to pass the resolution by a three-quarters majority. They kept counting votes until the affirmative votes which they had counted exceeded that number. They did not count the remainder of the votes. All the votes which they counted were ones in favour of Mr McClelland being expelled. Some votes were cast in Mr McClelland's favour, by Mr Nelson, Mr Miller, Mr Cane, and by Mr McClelland himself. Those votes were amongst the ballots which Mr Singleton and Mr Gray did not count, once the three-quarters threshold had been passed. 63 Soon after the 15 July meeting, Mr McClelland repaid the $170. He did this after approaching a chamber magistrate to seek some advice about his cross-claim against the Club, and being advised that it was 'much simpler" if he repaid the money and made a claim of everything that was owed to him. 64 On 20 July 1995 Mr McClelland issued a statement of liquidated claim against the Club, from the Local Court at Sutherland. The claim related to $949.40, made up of the three items he had mentioned in his letter of 29 April 1995, together with an additional $100 being the value of a "Mug of the Week" prize which Mr McClelland said he was entitled to. That claim was settled on 13 September 1995, on the basis that the Club would supply Mr McClelland with two 10 pound gas cylinders, would pay the $46 cost of issuing the statement of liquidated claim, would pay $78 as the "Mug of the Week" prize, and an arrangement was entered into whereby Mr McClelland recognised the trailer as being the property of the Club, but the Club agreed to make it available for Mr McClelland's use on reasonable notice to the boat captain. 65 On 25 July Mr McClelland initiated an appeal to the Sydney Branch of the Surf Life Saving Association, against the Club's resolution of 15 July. It appears that nothing was done about any such appeal until November 1995, when Mr McClelland wrote again to the Branch. The Branch, fairly promptly, replied, contending that Mr McClelland had no right of appeal to the Branch. Sporadic disputation about this topic continued until March 1996. 66 There was then a further gap until August 1996, when Mr McClelland requested the Sydney Branch to forward his appeal to Surf Life Saving New South Wales Inc. That body also took the view it had no jurisdiction to hear the appeal. In March 1997, Mr McClelland endeavoured to appeal to Surf Life Saving Australia Limited. That organisation likewise took the view that it did not have jurisdiction to hear the appeal. 67 On 1 April 1998, Mr McClelland appeared before Santow J on a notice of motion, filed in the proceedings he had begun in June 1995. He sought, amongst other things, declaratory relief that the Club recognise him as a member in good standing, and waive the membership fees for the 1995/6 to 1997/8 seasons. Following discussion before his Honour, a compromise was arrived at whereby Mr McClelland would be permitted to make a fresh application for membership of the Club, without the making of that application prejudicing any other rights he might have, which would then be considered by the Club in good faith. His Honour recognised that the delay which had intervened up to that time, might have some effect on the rights which Mr McClelland then had. His Honour's order was that: "… by consent I dismiss the notice of motion of 24 March 1998, noting that it is on the basis that the applicant reserves any right he may have to renew his application by a properly pleaded statement of claim with accompanying affidavits." 68 Mr McClelland made an application for membership of the Club on 2 April 1998, but on 1 May 1998 it was rejected. On 29 May 1998 he sought a statement of reasons, and on 4 June 1998, the Secretary of the defendant declined to provide any such reasons. 69 The present proceedings were begun on 22 December 1999, when the plaintiff filed a statement of claim. The Defendant's Rules 70 The Club had started its life as a voluntary unincorporated association. In 1988 it came to be incorporated under the provisions of the Associations Incorporations Act 1984. On 2 January 1994 it adopted new rules. 71 Though, at one time in 1995, Mr McClelland was contending that the rules adopted in 2 January 1994 were not validly adopted, that contention was not pressed before me. 72 Relevant provisions of the rules of the Club are: DISCIPLINING OF MEMBERS "15.1 Where the committee is of the opinion that a member of the Club:- (a) Has persistently refused or neglected to comply with a provision or provisions of these Rules; or (b) Has persistently and wilfully acted in a manner prejudicial to the interests of the Club. the Committee may, by resolution:- (c) expel the member from the Club; or (d) suspend the member from membership of the Club for a specified period. 15.2 A resolution of the Committee under clause 15.1 is of no effect unless the Committee, at a meeting held not earlier than fourteen (14) days and not later than twenty-eight (28) days after service on the member of a notice under clause 15.3 confirms the resolution in accordance with this rule. 15.3 Where the Committee passes a resolution under clause 15.1, the Secretary shall, as soon as practicable, cause a notice in writing to be served on the member:- (a) setting out the resolution of the Committee and the grounds on which it is based; (b) stating that the member may address the Committee at a meeting to be held not earlier than fourteen (14) days and not later than twenty-eight (28) days after service of the notice; (c) stating the date, place and time of that meeting and that the member is not entitled to legal representation; and (d) informing the member that the member may do either or both of the following: (i) attend and speak at that meeting; (ii) submit to the Committee at or prior to the date of that meeting written representations relating to the resolution. 15.4 At a meeting of the Committee held as referred to in clause 15.3, the committee shall:- (a) give to the member an opportunity to make oral representations; (b) give due consideration to any written representations submitted to the Committee by the member at or prior to the meeting; and (c) by resolution determine whether to confirm or to revoke the resolution. 15.5 Where the Committee confirms a resolution under clause 15.4, the Secretary shall, within seven (7) days after that confirmation, by notice in writing inform the member of the fact and of the member's right of appeal under Rule 16. 15.6 A resolution confirmed by the Committee under clause 15.4 does not take effect:- (a) until the expiration of the period within which the member is entitled to appeal against the resolution where the member does not exercise the right of appeal within that period; or (b) where within that period the member exercises the right of appeal, unless and until the Club confirms their resolution pursuant to Rule 16.4. 16. RIGHT OF APPEAL OF DISCIPLINED MEMBER 16.1 A member may appeal to the Club in general meeting against a resolution of the Committee which is confirmed under Rule 15.4, within seven (7) days after notice of the resolution is served on the member by lodging with the Secretary a notice to that effect. 16.2 Upon receipt of a notice from a member under clause 16.1. the Secretary shall notify the Committee which shall convene a general meeting of the Club to be held within twenty-one (21) days after the date on which the Secretary received the notice and shall give all members of the club at least seven (7) days notice of the matter to be dealt with at the meeting. 16.3 At a general meeting of the Club convened under clause 16.2:- (a) no business other than the question of the appeal shall be transacted: (b) the Committee and the member shall be given the opportunity to state their respective cases orally or in writing, or both; and (c) the members present shall vote by secret ballot on the question of whether the resolution should be confirmed or revoked. 16.4 If at the general meeting the Club passes a special resolution in favour of the confirmation of the resolution, the resolution is confirmed. … 33. NOTICE 33.1 Except where the nature of the business proposed to be dealt with at a General Meeting requires a special resolution of the Club, the Secretary shall, at least fourteen (14) days before the date fixed for the holding of the General Meeting, cause to be sent by pre-paid post to each member at the member's address appearing in the register of members, a notice specifying the place, date and time of the meeting and the nature of the business proposed to be transacted at the meeting. 33.2 Where the nature of the business proposed to be dealt with at a General Meeting requires a special resolution of the club, the Secretary shall, at least twenty-one (21) days before the date fixed for the holding of the General Meeting, cause notice to be sent to each member in the manner provided in clause 33.1 specifying in addition to the matter required under clause 33.1, the intention to propose the resolution as a special resolution. 33.3 No business other than that specified in the notice convening a General Meeting shall be transacted at the meeting except, in the case of an Annual General Meeting, business which may be transacted pursuant to Rule 32.3. … 39. SPECIAL RESOLUTIONS 39.1 A special resolution must be passed by a General Meeting of the club to effect the following changes: (a) a change of the Club's name; (b) a change of the Club's Rules (c) a change of the Club's objects; (d) an amalgamation with another Incorporated Club (e) to voluntarily wind up the Club and distribute its property; (f) to apply for registration as a Company or a Cooperative. 39.2 A resolution of the Club is a special resolution if it is passed by a majority which comprises not less than three-quarters of such members of the Club as, being entitled under these rules so to do, vote in person at a General Meeting of which not less than twenty-one (21) days' written notice specifying the intention to propose the resolution as a special resolution was given in accordance with those rules. …" Was There Adequate Notice of the Meeting of 15 July 1995? 73 One basis upon which Mr McClelland contends that the expulsion is ineffective is that inadequate notice was given to members of the meeting of 15 July. Mr McClelland puts the argument this way: pursuant to clause 15.6, the resolution of the Committee of 13 June 1995 does not take effect because he has exercised a right of appeal against it within the correct time; the resolution of the General Meeting of 15 July is ineffective because clause 16.4 requires a special resolution to be passed at the meeting if an expulsion is to be confirmed; clause 39.2 requires not less than 21 days written notice for a special resolution; yet in the present case less than 21 days notice was given. 74 A power to expel from an incorporated club is one where the procedures laid down by the Club's constituent documents must be strictly complied with, if the expulsion is to be valid. Hamilton J has collected authorities in support of this proposition in Hornby v Narrandera Ex-Servicemen's Club Ltd [2001] NSWSC 235, at [8]-[10]. Before one can apply that principle in the present case, however, one needs to first construe the rules of the Club, to find what period of notice was required for this particular meeting. 75 The rules of the Club show some signs of being drawn from different sources, not all of which are compatible one with the other. Rule 16 sets out a procedure to follow when a member wishes to appeal against a decision of the committee for his or her expulsion or suspension. Clause 16.1 sets out the first step - that the member who is the subject of the resolution appeal within 7 days after notice of the resolution being served on the member. In the present case, Mr McClelland was notified on 19 June of the Committee's resolution of 13 June, and appealed against that decision on 25 June. Thus, his appeal was within the time laid down by clause 16.1. 76 The next step, once a notice of appeal has been lodged, is that laid down by clause 16.2. That provision, requiring the Committee to convene a General Meeting of the Club to be held within 21 days after the date on which the Secretary received the notice, and to give all members of the Club at least 7 days notice of the matter to be dealt with at the meeting, has also been complied with in the instant case. 77 However, clause 16.4 contemplates that the expulsion or suspension is effective if at the General Meeting "the Club passes a special resolution in favour of the confirmation of the resolution". Clause 33.2 and clause 39.2 each contemplate that a special resolution must be one of which not less than 21 days written notice has been given. 78 If those requirements of clause 33.2 and clause 39.2 were read into clause 16.4, the effect would be that clause 16.4 was in irreconcilable conflict with clause 16.2 - it would be completely impossible for the period of notice required by clause 16.2 to be given, and for the period of notice required by clause 33.2 and clause 39.2 to also be given. That irreconcilable conflict is to be resolved, in my view, by allowing the specific notice provision contained in clause 16.2, and said to be applicable to the exercise of an appeal under clause 16, to prevail over the more general notice provisions contained in clause 33.2 and 39.2. When clause 16 is construed in that way, it has been strictly complied with, so far as the notice to call the meeting of 15 July 1995 is concerned. 79 This approach to the notice provisions is the same as that adopted by Burchett J in Whittle v Australian Miniature Pony Society Inc (1995) 57 FCR 252 at 257, concerning rules not materially different to rules 15 and 16 of the Club, and a general provision defining the notice requirements for a special resolution in a way incompatible with those rules. The Legal Basis of Mr McClelland's Complaint of Denial of Natural Justice 80 Mr McClelland also contends that he was denied natural justice in connection with the expulsion, and that in consequence the expulsion is invalid. 81 "Natural justice" is a concept familiar in the field of administrative law. There, it is now recognised as deriving from a common law duty concerning the manner in which powers are exercised in public law (Kioa v West (1985) 159 CLR 550 at 584 per Mason J, South Australia v O'Shea (1987) 163 CLR 378 at 386 per Mason CJ). There are two reasons for recognising it as a common law duty. The first is that the common law provided its own set of remedies, in the form of the prerogative writs, to enforce that duty. The second is that it is now established that a duty to accord natural justice can be owed by a decision maker whose authority does not derive from legislation - and hence, the source of the obligation to accord natural justice is, at least in those cases, not to be found by a process of statutory construction which implies into legislation a duty to act in accord with natural justice. Examples of an obligation of natural justice being imposed on public decision makers whose authority does not lie in legislation are Council of Civil Service Unions v Minister for the Civil Service [1985] AC 374 (exercise of the prerogative by the Prime Minister is subject to natural justice), and Victoria v Master Builders Association of Victoria [1995] 2 VR 121 (non-statutory "task force" compiling list of builders it would advise the government should be black listed is subject to natural justice). Further, various private bodies which exercise powers of public significance have been held to be bodies the courts can supervise by issuing prerogative orders: R v Panel on Takeovers and Mergers; ex parte Datafin Plc [1987] 1 QB 815 at 842; R v Panel on Takeovers and Mergers; ex parte Guinness Plc [1990] 1 QB 146; R v Visitors to the Inns of Court, ex parte Calder [1994] QB 1. 82 Concerning private clubs, it has likewise long been recognised that rules of natural justice apply to the exercise of a power of expulsion: Wood v Woad [1874] LR 9 Ex 190 (expulsion from a ship owner's mutual insurance society); Fisher v Keane [1879] 11 Ch 353 (expulsion from a gentlemen's club). However, the remedies available to correct a wrongful expulsion from a private organisation did not include the issue of a prerogative writ - rather, the appropriate remedy was a declaration that the expulsion was invalid, and an injunction against treating the expulsion as valid: R v Wilson; ex parte Robinson [1982] Qd R 642; R v British Broadcasting Corporation; ex parte Lavelle [1983] 1 WLR 23 at 30-31; Law v National Greyhound Racing Club Ltd [1983] 1 WLR 1302; Dixon v Australian Society of Accountants (1989) 95 FLR 231; R v Disciplinary Committee of the Jockey Club; ex parte Aga Khan [1993] 1 WLR 909. 83 Further, it is not in all cases where someone has been expelled from a club in breach of rules of natural justice that the court will intervene to provide a remedy. One circumstance in which a court would intervene, to provide a remedy by way of injunction if a person was expelled from a voluntary association in breach of rules of natural justice, was if the member would be thereby deprived of property to which membership entitled him or her (Rigby v Connol (1880) 14 Ch D 482 at 487 per Jessel MR. The proportion of members' subscriptions that was unspent at the time the action was brought was regarded as being an insufficient property right to justify the grant of an injunction: Amos v Brunton (1897) 18 NSWR (Eq) 184. However, in the course of the 20th century the courts came to regard what amounted to a sufficient right of property in a more liberal sense, so that the right of being a member of a trade union came to count as being enough of a right of property: Makin v Gallagher [1974] 2 NSWLR 559 at 578-582 per Holland J. 84 There is a long line of judicial statements, explaining that the basis on which a court can prevent excess of power by a domestic tribunal is by enforcing the contract under which the tribunal operates. Thus, in Dickason v Edwards (1910) 10 CLR 243 at 250 Griffith CJ said: "It is, of course, a general rule of natural fair play that a man cannot be judge in his own cause. In the case of statutory tribunals that rule is absolute unless the statute provides, as it does in some cases, that a person who is only formally a party may nevertheless sit on the tribunal, as, for instance, in England in the case of licensing tribunals and the London County Council when it sits to determine applications for granting licences. The rule prevails except so far as the language of the particular statute is to the contrary. In the case of tribunals created by contract between the parties it is entirely a question of the construction of the contract whether the parties have agreed that an interested person shall or shall not be disqualified. To exclude the general rule of fair play I think it is necessary that it should appear that the parties intend that a person may sit although he is interested, that is to say, he must be able to collect from the contract itself an agreement either expressly or by necessary implication to that effect. The question therefore resolves itself into an examination of this contract."

O'Connor J said, at 255: "It is necessary in the management of a society of this kind to give powers of expulsion. It is necessary also to appoint tribunals for the purpose of dealing with questions of conduct, and the courts will not interfere with the decisions of these tribunals unless they exceed their powers, and their decision results in injury to property or to civil rights. Whether a domestic tribunal has exceeded its powers is entirely a question of the construction of the contract which creates it. The rules of a society may give power to decide disputes on any principle the members think. The rules may be of such a nature as to empower a judicial body to decide in violation of all principles of natural justice. If the parties choose to agree to a tribunal having power of that kind the courts will not interfere. But in the interpretation of such a contract there are some leading principles to be borne in mind. The first is that in interpreting rules which give jurisdiction to any tribunal there is always to be read into them the underlying condition that the proceedings shall be carried out in accordance with the fundamental principles of common justice. It is upon a party who wishes to shut out the implication of that basic condition to show that the rules expressly or by necessary implication negative the implication of its existence." 85 Isaacs J puts the matter differently, with adherence to natural justice by a domestic tribunal being required as a matter of public policy, but subject to the possibility that any individual can waive it. At 258, he quoted with approval from the judgment of Esher MR in Allinson v General Council of Medical Education and Registration (1894) 1 QB 750, at 758: "In the administration of justice, whether by a recognised legal court or by persons who, although not a legal public court, are acting in a similar capacity, public policy requires that, in order that there should be no doubt about the purity of the administration, any person who is to take part in it should not be in such a position that he might be suspected of being biased." 86 At 260-261 Isaacs J said: "A distinction has been drawn between public judicial tribunals and private judicial tribunals, but I am not satisfied that that is a sound distinction. In Ranger v Great Western Railway Co (5 HLC, 82) a distinction was drawn between judicial and non-judicial tribunals, and I would particularly refer to these words of Lord Brougham (5 HLC 82, at 116): - "I think, therefore, that there is no ground for considering that the position in which he was placed was a quasi judicial position." There there was a contract by which the party had agreed to allowed the engineer of the company to arrive at an opinion which would govern him, and it was pointed out that that was in the face of the knowledge that the engineer represented the company. The House of Lords did not consider the engineer in the light of a judicial tribunal, but considered that there was a contract by which the plaintiff bound himself to submit to the determination of the agent of the defendant. That distinction is also drawn in R v Howard (1902) 2 KB 363, and the same point is referred to in R v Justices of Dublin (1904) 2 Ir R 75, at 91. But in any event it is clear that in the case of a public tribunal the party affected may, if he has knowledge, waive the objection of disqualification. Now, if he can in the case of a public tribunal, of course he can in the case of a private contract . He can waive the objection by his own agreement ." (emphasis added) 87 Further, it is apparent that Isaacs J is of the view that, in the case of a domestic tribunal, the agreement to waive what would otherwise be a requirement of natural justice can be found in the rules under which the tribunal is established. His Honour said, at 262: "The only thing that could sustain the finding is some distinct and express or necessarily implied provision in the contract under which, despite the natural injustice which would otherwise exist, Gallant was allowed to sit." 88 His Honour went on to see whether there was any such express or necessarily implied provision in the rules of the organisation. 89 Thus, there is not as great a difference between the views of Griffith CJ and O'Connor J (on the one hand) and Isaacs J (on the other), as might at first appear. While Isaacs J invokes "public policy" as a ground on which a requirement of observance of the rules of natural justice will be imposed on "persons who, although not a legal public court, are acting in a similar capacity", it is a public policy which is able to be overcome by the agreement of the parties. A public policy which can be circumvented or overcome by agreement of the parties is of a quite different type to the public policy which can invalidate a provision in a contract which is inconsistent with that policy, like a contract to oust the jurisdiction of court (Harbottle Brown & Co Pty Ltd v Halstead [1968] 3 NSWR 493), or a contract (or non-contractual arrangement) in restraint of trade (Buckley v Tutty (1971) 125 CLR 353). 90 A basis additional to the protection of property rights, upon which a court could grant a declaration of the invalidity of an expulsion, and an injunction against giving effect to the invalid expulsion, was recognised in Edgar v Meade (1916) 23 CLR 29. One plaintiff had been wrongly expelled from an organisation registered under the Commonwealth Conciliation and Arbitration Act 1904. Another plaintiff, representative of a branch concerning which a resolution had been passed to close the branch, challenged the validity of that decision. Isaacs J said, at 43-44: "In the case of a purely voluntary association, a Court of equity bases its jurisdiction on property, there being nothing else for it to act on. A Court of common law before the Judicature Act regarded the invalid expulsion as void, and gave no damages. So between the two jurisdictions the plaintiff could rely only on property as the basis for jurisdiction. But here the situation, in my opinion, calls for another view. This organisation is a creature of the federal parliament for a special reason, and as incidental to a specific power in the Constitution. The incorporation of employees in such an organisation is a matter of public policy, and to effectuate the object of the Act. For this purpose rules are required to be registered, and in my opinion a member or a group of members forming a branch recognised by the rules have a locus standi to assert in a competent Court their legal rights to remain members of the organisation, notwithstanding an invalid resolution to expel him or them, and so exclude him or them from the status and benefits which the Act intended them to have. As to Edgar [the first plaintiff] he has a proprietary right; but, as to both him and the plaintiffs in the second action, I hold their rights to sue do not in such a case as this depend on the question of property affected. The very object of the legislative provisions in incorporating such associations and facilitating the settlement of industrial disputes might be defeated if members and branches could be excluded by a governing body, contrary to rules, unless property was involved. The organisation is therefore not in the same position as a voluntary club."

(The first three sentences of this quotation were quoted with approval by Rich, Dixon, Evatt and McTiernan JJ in Cameron v Hogan (1934) 51 CLR 358, at 372.) 91 In relation to some voluntary unincorporated associations, the rules are not intended to be contractual, and the members have no interest in the property of the association. Concerning such organisations, courts have declined to intervene by way of declaration and injunction when it is alleged an expulsion has occurred contrary to the rules. Thus in Cameron v Hogan (1934) 51 CLR 358, at 376 which Dixon, Evatt and McTiernan JJ said: "Hitherto rules made by a political or like organisation for the regulation of its affairs and the conduct of its activities have never been understood as imposing contractual duties upon its officers or member. Such matters are naturally regarded as of domestic concern. The rules are intended to be enforced by the authorities appointed under them. In adopting them, the members ought not to be presumed to contemplate the creation of enforceable legal rights and duties so that every departure exposes the officer or member concerned to a civil sanction." cf Balfour v Balfour [1919] 2 KB 571 . 92 It is always a matter of construction of the rules of the individual organisation whether they are intended to create contractual relations, whether they confer on members a sufficient right of property to give the member standing to seek a declaration and injunction, or whether there is some other circumstance (such as occurred in Edgar v Meade) which gives the member standing to seek those remedies. 93 The difference between the basis upon which the court acts in keeping within proper bounds public decision-makers, and private or domestic tribunals continues to be recognised. In R v Criminal Injuries Compensation Board; ex parte Lain [1967] 2 QB 864 at 882 Lord Parker CJ said: "The position as I see it is that the exact limits of the ancient remedy by way of certiorari have never been and ought not to be specifically defined. They have been varied from time to time being extended to meet changing conditions. At one time the writ only went to an inferior court. Later its ambit was extended to statutory tribunals determining a lis inter partes. Later again it extended to cases where there was no lis in the strict sense of the word but where immediate or subsequent rights of a citizen were affected. The only constant limits throughout were that it was performing a public duty. Private or domestic tribunals have always been outside the scope of certiorari, since their authority is derived solely from contract, that is, from the agreement of the parties concerned." (Emphasis added.) 94 Diplock LJ said, at 884: "The jurisdiction of the High Court as successor of the Court of Queens Bench to supervise the exercise of their jurisdiction by inferior tribunals has not in the past been dependant upon the source of the tribunal's authority to decide issues submitted to its determination, except where such authority is derived solely from agreement of the parties to the determination. The latter case falls within the field of private contract and thus within the ordinary civil jurisdiction of the High Court supplemented where appropriate by its statutory jurisdiction under the Arbitration Act ." 95 In Law v National Greyhound Racing Club Ltd [1983] 1 WLR 1302 the English Court of Appeal considered a claim that a decision of stewards, under the rules of racing applicable to greyhounds, that the plaintiff's trainer's licence should be suspended, was void. The ground on which the plaintiff alleged the decision was void was that it was contrary to an implied term of an agreement between the trainer and the racing club that any action taken would be reasonable and fair and made on reasonable grounds. The plaintiff claimed a declaration of invalidity of the decision. The question for determination by the court, was whether the special procedures which Order 53 of the Rules of the Supreme Court applied to applications for judicial review should have been followed in the instant case. The court held that those procedures should not have been followed. In so deciding, Lawton LJ said, at 1307: "In my judgment, such powers as the stewards had to suspend the plaintiff's licence were derived from a contract between him and the defendants. This was so for all who took part in greyhound racing in stadia licensed by the defendants. A stewards' enquiry under the defendants' Rules of Racing concerned only those who voluntarily submitted themselves to the stewards' jurisdiction. There was no public element in the jurisdiction itself."

At 1309, Fox LJ said: "Accordingly, in my view, the authority of the stewards to suspend the license of the plaintiff derives wholly from a contract between him and the defendants. I see nothing to suggest that the defendants have rights or duties relating to members of the public as such. What the defendants do in relation to the control of greyhound racing may affect the public, or a section of it, but the defendants' powers in relation to the matters with which this case is concerned are contractual."

Slade LJ said, at 1312: "… the rules of racing of the NGRC and its decision to suspend the plaintiff in purported compliance with those rules have not been made in the field of public law. Furthermore, its authority to perform judicial or quasi judicial functions in respect of persons holding licenses from it is not derived from statute or statutory instruments or from the Crown. It is derived solely from contract. Rule 2 of the NGRC's Rules of Racing provides that every person who is the holder of a license shall be deemed to have read the rules and to submit himself to them and to the jurisdiction of the NGRC. The relief, by way of declaration and injunction, sought by the plaintiff in his originating summons is correspondingly based primarily and explicitly on alleged breach of contract."

(See also Lee v The Showmen's Guild of Great Britain [1952] 2 QB 329 at 346 per Denning LJ; Byrne v Kinematograph Renters Society Ltd [1958] 1 WLR 762 at 778-781 per Harman J.) 96 There have been suggestions in some cases that, in relation to bodies which have no statutory basis but whose decisions can affect the rights of members or others, rules of natural justice are implied as a matter of public policy (Dawkins v Antrobus (1881) 17 Ch D 615 at 630-631 (per Brett LJ); Lee v The Showmen's Guild of Great Britain [1952] 2 QB 329 at 342 per Denning LJ; Bonsor v Musicians Union [1954] Ch 479 at 485-486 per Denning LJ; John v Rees [1970] Ch 345 at 399-400 per Megarry J; Edwards v Society of Graphical and Allied Trades [1971] 1 Ch 354 at 377 per Lord Denning MR, 382 per Sachs LJ; Enderby Town Council Football Club Ltd v Football Association Ltd [1971] 1 Ch 591 at 606 per Lord Denning MR (recording a concession by counsel) Forbes v New South Wales Trotting Club Ltd (1979) 143 CLR 242 at 275-276 per Murphy J; Calvin v Carr [1977] 2 NSWLR 308 at 331-332 (per Rath J)). However the length of this list does not lead to a conclusion that it is correct to say that rules of natural justice are implied into the rules of such bodies as a matter of public policy, if by "public policy" one means the sort of legal provision out of which it is impossible to contract. Not all of these cases are ones which squarely face the question of whether the kind of public policy which is being talked about, is the kind of public policy which results in a provision of a contract being void or unenforceable. Any persuasiveness of the dictum of Megarry J in John v Rees is lessened by the fact that in Gaiman v National Association for Mental Health [1971] Ch 317 at 338 Megarry J deliberately refrained from deciding whether there was any rule of public policy which prevents the principles of natural justice from being ousted by an express term which excludes them. The persuasiveness of Lord Denning MR's remarks in Edwards is lessened by their being linked to a person's "right to work", the juristic peculiarities of which have been pointed out by Megarry V-C in McInnes v Onslw-Fane [1978] 1 WLR 1520 at 1528, and further questioned in Forbes v New South Wales Trotting Club Ltd (1979) 143 CLR 242 at 260-261; Hepples v Federal Commission of Taxation (1992) 173 CLR 492 at 502-3, 527 and 529; and Curro v Beyond Productions Pty Ltd (1993) 30 NSWLR 337 at 346. 97 In Australia, the preferable view is that natural justice comes to operate in private clubs and associations by the rules of those private organisations being construed on the basis that fair procedures are intended, but recognising the possibility that express words or necessary implication in the rules could exclude natural justice in whole or part. The judgments in Dickason v Edwards support that view. Further, in Australian Workers' Union v Bowen (No.2) (1948) 77 CLR 601 the statement of O'Connor J in Dickason v Edwards to that effect (set out in paragraph 84 above) was approved by Latham CJ at 617, and also by Dixon J (with whom Starke J agreed) at 631. Williams J, at 638 said: "But the principles of natural justice cannot override the express provisions of the rules, and it could not be "contrary to the essence of justice" for the executive council honestly and bona fide to exercise all its powers and duties under the rules." 98 To some extent the rules of natural justice are applied to the rules as a matter of construction of terms within them (so that a reference to a "hearing" will be construed as a reference to a fair hearing, and a reference to "after inquiry" will be construed as a reference to "after due inquiry", unless there is a context which shows that that construction was not intended), and to some extent the rules of natural justice are applied to the rules of the private organisation by a process of implication of terms, when there is no express term inconsistent with the implication of such a term. 99 In Thorborn v All Nations Club (1975) 1 ACLR 127 Helsham J held, at 132: "In my view, the rules of a social club may expressly provide that the rules of natural justice shall not apply to expulsion of a member for misconduct in cases where there are no proprietary rights involved and the livelihood of members is not involved. It seems to me impossible in such cases to draw a distinction between the cases where the express provisions of the rules make it impossible to imply that the rules of natural justice are to be observed and a case where those rules are alluded to and expressly excluded." 100 That this should be so is consistent with the way that the "rules of natural justice" are recognised as having a variable content. In General Medical Council v Spakman [1943] AC 627, at 644 the expression was described as "sadly lacking in precision". In Russell v Duke of Norfolk [1949] 1 All ER 109 at 188 Tucker LJ said: "The requirements of natural justice must depend on the circumstances of the case, the nature of the inquiry, the rules under which the tribunal is acting, the subject matter that is being dealt with, and so forth. Accordingly I do not derive much assistance from the definitions of natural justice which have been from time to time used, but, whatever standard is adopted, one essential is that the person concerned should have a reasonable opportunity of presenting his case."

In R v The Commonwealth Conciliation and Arbitration Commission ; ex parte The Angliss Group (1969) 122 CLR 546, at 552 the High Court said that the common law principles of natural justice, "… are not to be found in a fixed body of rules applied inflexibly at all times and in all circumstances." Their Honours quoted the first sentence of the passage set out above from the judgment of Tucker LJ in Russell v Duke of Norfolk, and noted that it had been approved by the Privy Council in University of Ceylon v Fernando [1960] 1 WLR 223. Their Honours also quoted from the judgment of Kitto J in Mobil Oil Australia Pty Ltd v Federal Commissioner of Taxation (1963) 113 CLR 475, at 504, where Kitto J said: "What the law requires in the discharge of a quasi-judicial function is judicial fairness … what is fair in a given situation depends upon the circumstances."

(See also National Companies and Securities Commission v The News Corporation Limited (1984) 156 CLR 296 at 312 per Gibbs CJ, 319-320 per Mason, Wilson and Dawson JJ, Kioa v West (1985) 159 CLR 550 at 563 per Gibbs CJ , 594 per Wilson J, 612-615 per Brennan J. 101 In Kioa, at 585, after referring to this line of authority, Mason J continued: "The critical question in most cases is not whether the principles of natural justice apply. It is: what does the duty to act fairly require in the circumstances of the particular case? It will be convenient to consider at the outset whether the statute displaces the duty when the statute contains a specific provision to that effect, for then it will be pointless to inquire what the duty requires in the circumstances of the case, unless there are circumstances not contemplated by the statutory provision that may give rise to a legitimate expectation. However, in general, it will be a matter of determining what the duty to act fairly requires in the way of procedural fairness in the circumstances of the case." 102 When the "rules of natural justice" have this variable, chameleon quality, it would be odd if there were to be a public policy which made adherence to such a shifting standard completely unexcludable. The Significance of the Club being Incorporated under the Associations Incorporation Act 103 The Club is an association incorporated under the Associations Incorporation Act 1984. That Act enabled the incorporation of associations formed or carried on for any lawful object and consisting of not less than five members (section 71), provided that the association was not of a type listed in any of section 7(2)(a)-(g). Section 11 provides: " (1) The rules of an incorporated association or proposed incorporated association comply with this section if: (a) they make provision, whether by adoption of the model rules or otherwise, for: (i) the several matters specified in Schedule 1, and (ii) such other matters as may be prescribed, and (b) they are divided into paragraphs which are designated by letters in alphabetical order or are numbered consecutively. (2) Subject to this Act, the rules of an incorporated association bind the association and the members of the association to the same extent as if the rules had been signed and sealed by each member and contained covenants on the part of each member to observe all the provisions of the rules." 104 Schedule 1 of the Act included the following: "5. Disciplining of members The procedure (if any) for the disciplining of members and the mechanism (if any) for appeals by members in respect of disciplinary action taken against them. 5A. Internal disputes The mechanism for the resolution of disputes between members (in their capacity as members) and between members and the incorporated association." 105 Section 18 provides: "(1) Subject to this Act, an incorporated association shall not: … (b) exercise any power contrary to a restriction on the exercise of that power contained in the rules of the association … (3) An act of an incorporated association … is not invalid by reason only that the doing of the act is prohibited by subsection (1) or by the rules of the association. (5) The fact that: (a) the doing of an act by an incorporated association was or would be prohibited by subsection (1) or by the rules of the association … may be asserted or relied on only in: … (d) proceedings against the association by a member of the association to restrain the doing of any act by the association." 106 Analogously to Edgar v Meade (paragraph 90 above), the members of an association incorporated under this Act have locus standi in a court to take proceedings against the association to restrain the association from treating as valid any purported expulsion or suspension which is contrary to the rules of the association. Section 18(5)(d) of the Act expressly confers that locus standi. 107 This conclusion mirrors the conclusion which has been reached in relation to the standing of a member of a club conducted by a company limited by guarantee to approach the court for relief concerning a wrongful expulsion: McNab v Auburn Soccer Sports Club Ltd [1975] 1 NSWLR 54, at 59 per Needham J. By this process of reasoning, the important policy objective of allowing the courts to decide such matters can be carried out, without running foul of the High Court's decision in Cameron v Hogan (1934) 51 CLR 358, which related to an unincorporated association: cf McKinnon v Grogan [1974] 1 NSWLR 295. 108 Another conclusion which can be drawn from the terms of section 11(1) and Schedule 1(5) of the Associations Incorporations Act, is that it was to be a matter of choice for associations whether they would have rules governing the procedure for the disciplining of members, and the mechanisms for appeals by members in respect of disciplinary action taken against them. While section 11(1) and Schedule 1(5A) made it mandatory for an association to have rules providing a mechanism for the resolution of disputes between members (in their capacity as members) and between members and the incorporated association, it was for the members of the association to choose precisely what the mechanism would be. There was no attempt to compel, by legislative requirement, any particular set of standards that (in particular) rules must adhere to, concerning the expulsion of members. 109 As well, section 11(2) has an effect which cuts two ways concerning an expulsion from the Club. So far as a member is concerned, he or she has the benefit of a deemed covenant with each other member to observe all the provisions of the rules, which has as a consequence a contractual obligation on each member not to expel any other member save in accordance with the rules. As well, though, that covenant has the consequence that someone in the position of Mr McClelland covenants with the other members that, if the procedures of the rules are followed for an expulsion, he will be bound to treat that expulsion as an effective one. These mutual contractual obligations are ones which would be cut down or varied only to the extent to which there was some contrary public policy (meaning thereby a public policy of the type which can override contractual obligations), or if there was some equity which precluded the parties to the contract from relying on their strict contractual rights. As I have earlier held, the rules of natural justice are not, in their application to domestic tribunals, rules which operate as a matter of public policy of a kind incapable of being varied by contract. No equity to prevent the provisions of the deemed contract between the members being relied upon has been asserted in the present proceedings. A Digression about Non-Members and Natural Justice in Private Bodies 110 Though the provisions of the Associations Incorporation Act suffice to give Mr McClelland standing to bring the present action, there will be occasions when a person who is affected by a decision of a private body wishes to challenge the validity of that decision as being contrary to natural justice, even though that person is not a member of the body which made the decision, or otherwise not in a contractual relationship with it. In Forbes v New South Wales Trotting Club Ltd (1979) 143 CLR 242 the High Court made a declaration of invalidity of a "warning off" by the Trotting Club, a corporation which had de facto control of trotting in New South Wales, and which administered rules which had no statutory force (250) at the suit of a plaintiff who was not a member of the defendant. It should be noted, however, that the applicability of the rules of natural justice was conceded by counsel (248, 264), the concession apparently being made on the basis of Heatley v Tasmanian Racing & Gaming Commission (1977) 137 CLR 487, a case where the Commission in question was a statutory authority, and the reasoning in which proceeded on the basis where the fact that it was a statutory authority played a role in why the rules of natural justice were applicable to it. Even so, Gibbs J said, in Forbes, at 264: "This concession seems to me to have been correctly made. The respondent, although not granted statutory powers, was in fact the body whose function was to control trotting in New South Wales, and trotting is a public activity in which quite large numbers of people take part, whether as spectators or otherwise. Members of the public have the legitimate expectation that they will be given permission to go on to courses when trotting meetings are being held provided that they pay the stipulated charge and provided of course that they are not drunk, disorderly or otherwise unfitted by their condition or behaviour to be admitted. The respondent had power to defeat this expectation by acting under r 28, and was accordingly required to observe the rules of natural justice: Heatley v Tasmanian Racing & Gaming Commission (1977) 137 CLR at 494, 508-509." 111 In Harrison v Hearn [1972] 1 NSWLR 428 Helsham J held that a student at Macquarie University had standing to restrain a proposed ultra varies expenditure of money by the students' council, even though he was not a member of the council and not in contractual relationship with it. In McInnes v Onslow-Fane [1978] 1 WLR 1520 Megarry V-C acted on a concession by counsel (1528H) that there was an obligation of natural justice and fairness when someone not a member applied to an unincorporated body with de facto control of boxing for a boxing manager's license. In Stininato v Auckland Boxing Association (Inc) [1978] 1 NZLR 609 the New Zealand Court of Appeal held that a professional boxer had standing to apply to the Court for a declaration that a decision of the defendant (a body with de facto control of the sport, and with whom the plaintiff had no contractual relationship) was void by reason of being contrary to natural justice. Richmond P noted that the courts had accorded standing to footballers and horse trainers to challenge decisions of bodies of which they were not a member, on the ground that those decisions contravened the public policy concerning restraint of trade, and that standing existed in such cases even when the plaintiff was not a member or otherwise in a contractual relationship with the decision maker. Richmond P said, at 8: "The authorities to which I have just referred demonstrate that if the rules of the New Zealand Association had expressly stated that when considering an application for a license the council had the right to act capriciously or unfairly then, and in either case, a professional boxer with a sufficient interest could have asked the court to declare that the rule itself was void as an unreasonable restraint of trade. I think that the court would in fact have made such a declaration having regard to the monopolistic control in fact exercised by the council. If the actual rule is saved from being void as an unreasonable restraint of trade because, as I believe, it is inherent in the nature of the discretion conferred on the council that it must not be exercised either capriciously or unfairly, then it would be an absurdity if a plaintiff, whose application had not in fact been fairly dealt with, could not also come to the court and ask for a declaration that a decision unfairly arrived at under a valid rule should be declared a nullity. That cannot be the law, and I accordingly hold that the lack of contractual relationship between Stininato and the Council is not fatal to his claim."

Cooke J, at 28 referred to restraint of trade cases including Blackler v New Zealand Rugby Football League (Inc) [1968] NZLR 547, where a rule under which the plaintiff had been denied a "clearance" to play in Australia was declared void as an unreasonable restraint of trade. Cooke J said, at 28: "In Blackler the rule was held void. No similar wholesale attack has been made on the rule in this case. But in principle I think that plaintiff should be able to limit his attack and to claim simply that a decision under power delegated by a rule is in unreasonable restraint of trade. And, taking the point one stage further, I think a plaintiff can say 'it may be reasonable in this professional sport for the council to have a wide discretion to refuse a licence, but it certainly is not reasonable for them to refuse a licence on the grounds of misconduct without giving me any chance of being heard'. … … Blackler is for us an important affirmation by a majority of the court of the need to mould public policy to protect the right to work. When one adds the traditional concern of the common law to ensure that a man is not condemned without an opportunity of being heard, there is strong reason for holding that the court has a power of review in the present kind of case. That does not mean that the court can compel licensing or admission to membership. But I think the court can declare past decisions invalid, which may assist future applications and may also mitigate damage to the plaintiff's status or reputation. And in some cases a mandatory injunction to compel proper consideration of a pending application would be available. Both remedies, of course, are essentially discretionary." 112 In Finnigan v New Zealand Rugby Football Inc [1985] 2 NZLR 159 at 177-179 a member of a local rugby club (who was not a member of the national controlling body) was held to have standing to challenge a decision of the national body to send a team to South Africa as being contrary to the objects of the national body. 113 If one tries to apply the approach of Gibbs CJ in Forbes it is difficult to see how someone who is in practice affected by a decision of a private body of which he is not a member, or otherwise in any contractual relationship, could have any legitimate expectation other than that the body would act in accordance with its own rules, properly construed, in reaching that decision. A member of the private body has an expectation, and a right, that the body will make decisions in accordance with its rules: it is hard to see how the expectation of a non-member could be that the body will observe any different standard. If a decision is arrived at by a private body which, contrary to its own rules, does not accord procedural fairness to a non-member who is affected, it is in theory possible that there may be circumstances where the courts will recognise such a person as having standing to apply for a declaration of the invalidity of the decision, and an injunction against treating it as valid. It would be for the courts to develop, on a case-by-case basis, the circumstances in which such standing should be recognised. Even though the legal basis of the body's right to make a decision is contained in the constitutive documents of the body itself, there is no necessary reason why it should be only members of the body, or people with the benefit of a contractual promise that the body will follow its own required procedures, who can assert the invalidity of the decision. It is a fact of life that a decision of a private tribunal can affect people who are not members, or people who are not bound by contract to observe the decision- and the existence of the private body and of the decisions of its tribunal is a reality which affects people other than by force of a contract with the body. If the body has practical power to affect a plaintiff in a sufficiently serious way, it would be for the courts to recognise in which situations the nature of affectation of the interests of the plaintiff is sufficient to confer standing. 114 For all the conceptual difficulties of the notion of there being a "right to work", the practical importance of not being deprived of the opportunity to work may well suffice to accord a plaintiff standing to contend that the decision of a private tribunal which denied him or her the opportunity to work was void, and that a declaration of invalidity and injunction should issue. 115 In Typing Centre of New South Wales v Toose (15 December 1988, unreported) Mathews J was prepared to embark upon judicial review of a decision of the Advertising Standards Council (a body established by "Charter" in 1974, the parties to that charter being the Media Council, the Australian Association of National Advertisers, and the Advertising Federation of Australia). The plaintiff was not a member of the Council, nor, apparently, did the plaintiff have any contractual relationship with it. The plaintiff was aggrieved that the Council had upheld a complaint about one of the plaintiff's advertisements. The effect of upholding that complaint was that, pursuant to an agreement concerning which an authorisation under the Trade Practices Act 1974 (Cth) had issued, no media proprietor would publish the advertisement. Mathews J held that the Advertising Standards Council was exercising public functions. Her Honour's reasons were (at 19-20): "The ASC has power, through its complaints procedures, to interpret and mould the various advertising codes in precisely the same way as the courts can interpret and mould Acts of Parliament. This, to my mind, is a very public function indeed. And it goes further than this. Many provisions of the Codes, (including the ones we are concerned with in this case), do little more than restate the existing law. In relation to these provisions, the ASC is, in effect, providing an alternative forum for dealing with matters which might otherwise need to be litigated in the courts. And all this in relation to people or organisations who need do no more than insert a single media advertisement in order to attract the ASC's jurisdiction." 116 Her Honour also relied on the self-evident importance of advertising in our community. 117 In adopting this test, her Honour was applying the decision in Panel on Takeovers and Mergers, ex parte Datafin Plc [1987] 1 QB 815. Insofar as the Datafin case was concerned with whether a body was susceptible to "judicial review" within the meaning of Order 53 of the Rules of Supreme Court (at 817, 845) her Honour was applying a test for the availability of prerogative remedies. See also Dorf Industries Pty Ltd v Toose (1994) 54 FCR 350 at 363ff where Ryan J held that the fact that a decision of the Advertising Standards Council was susceptible to judicial review, and no proceedings had been taken to quash it, was a sufficient reason not to grant a declaration that (contrary to a decision of the ASC) certain advertisements did not contain anything likely to cause serious offence to the community or a significant section of the community, contrary to clause 6 of the Advertising Code of Ethics. The availability of prerogative remedies against a private corporation exercising public powers may provide a means, alternative to expanding the situations where a non-member is accorded standing to seek an injunction and declaration of invalidity, by which such bodies can be required to act within their powers. Mr McClelland's Complaints 118 On the basis of this understanding of how the "rules of natural justice" operate in the affairs of an association like the Club, I turn to consider the particular complaints which Mr McClelland makes. It is common ground between the parties that the court is not concerned with the merits of the decision which was made by the Club. Rather, the court's enquiry is directed to whether there has been any breach of procedures which are legally required before there can be an effective expulsion resolution. Complaints About the Meeting of 16 May 1995 No Opportunity to Address the Meeting at all 119 At the meeting on 16 May, Mr McClelland had no opportunity to address the Committee at all. However, it is the effect of Rule 15.2 that any resolution passed under clause 15.1 is not effective unless confirmed, in the manner required by clause 15.3 and 15.4. Thus, the resolution passed under clause 15.1 is not of itself sufficient to bring about an expulsion. 120 It would have been inconsistent with express provisions of the Rules for Mr McClelland to have had the opportunity to make submission on 16 May. It is an inevitable part of the structure of decision-making which Rules 15 and 16 sets out that any member who is not a member of the Committee will not have an opportunity to put submissions at the meeting called pursuant to clause 15.1. When the decision under Rule 15.1 cannot bring about an expulsion of its own force, and there is full opportunity for an accused member to make submissions, as to both guilt and penalty, under clause 15.3, a process of construing the rules with a view to making them accord fair procedures does not require an opportunity to make submissions on these matters to be accorded at the meeting called under clause 15.1. 121 At the meeting held on 13 June, Mr McClelland had been given notice (by Mr Jacobs' letter dated 25 May 1995 (see paragraph 36 above)) of the resolutions, and his right to attend and speak at the meeting. He had every opportunity, at that meeting, of making whatever submissions he felt were needed on any matter whatever. He also had another opportunity at the general meeting. The structure of the rules as a whole gives him the opportunity to present his case, before a final decision is made. No Separation of Questions of Guilty and Penalty 122 In relation to the meeting of 16 May, and also the meetings of 13 June and 15 July, Mr McClelland complains that there were no separate hearings on the topics of guilt, and penalty. It is convenient to deal with that complaint in relation to all three meetings. 123 The meeting of 16 May is one where the Committee was acting pursuant to Rule 15.1. At that meeting, the Committee had before it the three motions set out in the supplementary agenda (see paragraph 28 above). The first resolution on that agenda was one concerned with the question of guilt; the second resolution was one concerned with the question of penalty. It was perfectly possible for the Committee to pass one, but not the other. Thus, the topics of guilt, and penalty, were separated in the sense that there were the two resolutions, which needed to be separately voted on. 124 At the meeting on 13 June, and also at the General Meeting, Mr McClelland had the opportunity to make the submission that, even if the first resolution was passed, expulsion would be an excessive penalty and, that, consistent with the express terms of clause 15.1, suspension would suffice. 125 Fair procedures, when applied by a process of construction and implication to these rules, would require that Mr McClelland have the opportunity of making submissions on both guilt, and penalty (Stone v Law Society (NT) (1992) 108 FLR 332 at 344; Malone v Marr [1981] 2 NSWLR 894; Hall v New South Wales Trotting Club Ltd [1977] 1 NSWLR 378). However, there is no rule of law to the effect that it is not possible for there to be a single hearing which addresses both questions of guilt, and on a contingent basis, questions of penalty (Barnes v Australian Telecommunications Commission (1989) 25 FCR 283 at 290-291.) Most civil litigation involving claims for damages accord the plaintiff a single hearing, where the quantum of damages is argued about on the contingent basis that the court ultimately decides that liability is established, but the court's procedures are not thereby shown to be unfair ones. 126 But it is to the terms of the rules that one must turn in deciding what procedures were required. The structure of clause 15.3 required that "the resolution of the Committee" be the subject of the meeting under clause 15.4. That resolution was the resolution to expel. The finding that the actions referred to in the first resolution be considered to be persistent and wilful actions prejudicial to the interests of the Club were the grounds on which that resolution was based. The structure of the rules required that the meeting under clause 15.4 "determine whether to confirm or to revoke the resolution", which would involve consideration of both guilt, and penalty. 127 Similarly, the subject of the general meeting called under clause 16 was "whether the resolution should be confirmed or revoked" and this likewise involved questions of guilt, and penalty, both being considered. I am not persuaded that there was any departure from the requirements of clauses 15 and 16 arising from any failure to give separate hearings on the question of guilt and the question of penalty. Irrelevancies 128 Mr McClelland complains that, at the meeting on 16 May, the Committee had before it material which was irrelevant to the resolutions. Mr Singleton's statutory declaration referred to more monies being unaccounted for than the $170 which were the subject of the resolution. Mr Vaughan's statutory declaration contained his recollections of the conversation where Mr McClelland had talked about $200, and Queensland (see paragraph 16 above), and the two incidents which I have set out in paragraph 18 above. 129 Concerning the amount of $200, Mr McClelland had a ready explanation. It was that he had borrowed $200 from Steve Singleton, in addition to the $170 borrowed from the "Mug" monies, to finance his trip to Queensland. In other words, notwithstanding the initial suspicions which Mr Vaughan had harboured, the $200 had not been borrowed from the "Mug" money. 130 The only resolutions which the meeting was asked to consider were ones which related to the missing "Mug" monies, and the only amount of missing "Mug" money, concerning which Mr McClelland was in any way accused, was $170. I see no breach of fair procedures in the statutory declaration making reference to these other matters which were part of the surrounding circumstances, part of the history of how the charge concerning the missing $170 came to be made, but were matters which were not made the basis of any resolution to expel Mr McClelland. Mr Vaughan's Attitude 131 In submissions, Mr McClelland sought to place reliance on two letters he had received from Mr Vaughan. The first was dated 6 April 1995. It set out Mr Vaughan's account of his finding out about Mr McClelland having responded to the Club's letter concerning the Leader article. That letter says, concerning the letters which Mr McClelland handed to Mr Vaughan on 3 April 1995: "I read these when I arrived home and was incensed to the extent that I immediately rang you at the Hotel. I told you what I thought of you and the action you had taken which, in every respect, broke the arrangements I am convinced I made with you on Friday and as far as I am concerned still held. I make no apologies for the language, the sentiments expressed and the later demand I made on you. As a result of your behaviour I have lost all faith in you as a person to be trusted - this is not the first time you have broken arrangements with me to suit your own agenda but it will certainly be the last. You must have been terrified over the weekend that somebody would take action to withdraw the letter and possibly apologise, thus robbing you of the chance of having another go at the Club, the Branch and, in particular, Steve Strange. Even though you knew that endeavours were being made to set things right, you did not have the common decency to phone and say you had changed your mind and were going to send out letters (dated Sunday). I am at a loss as to how you made the quantum leap from "complaints from many Surf Club members" to "that some members of the Branch 'were not pleased' with the article" and then go on to abuse Association Officials. But, as you have often said of others, "don't let the truth stand in the way of a good story". Suffice to say I no longer want to be associated with you in any regard including commercially. I no longer trust you or your motives and whereas, in the past, I have at least endeavoured to ensure that, by my standards and to the best of my ability, you received a fair go - Now - I couldn't give a shit." 132 Mr McClelland had replied to that letter on 12 April 1995, agreeing with some of it, disagreeing with other parts of it, and referring to some other disputes which Mr McClelland had with the Club, some of which went back to 1987. Mr Vaughan's reply, dated 19 April 1995, was concise: "Read my lips - I don't give a shit!" 133 Mr McClelland sought to submit that this gave rise to a claim of actual bias. No allegation of bias had been pleaded, nor had it been referred to in opening, nor had any evidentiary foundation for it been laid in cross-examination. Mr Vaughan was, at the time of the hearing, seriously ill. He had sworn an affidavit for the purpose of the proceedings, which I had declined to permit to be read when Mr Vaughan was unavailable for cross-examination. In these circumstances I did not permit the question of bias to be agitated. 134 An alternative submission was put, that people at the meeting were acting "as both prosecutor and judge", which was inconsistent with fair procedures. 135 A domestic tribunal is not a court, and what counts as fair procedures within the scope of its rules is not to be measured by the standards of a court. In Australian Workers Union v Bowen (No.2) (1948) 77 CLR 601, at 628 Dixon J (with whom Starke J agreed) said: "That leaves on one side any question of the violation of the principle that prima facie a prosecutor cannot sit as judge. It is important to keep steadily in mind that we are dealing with a domestic forum acting under rules resting upon a consensual basis. It is a tribunal that has no rules of evidence and can inform itself in any way it chooses. Members may act upon their own knowledge and upon hearsay if they are satisfied of the truth of what they so learn and if they give the member with whom they are dealing a proper opportunity of answering the charge and defending himself. The tests applied to juries' verdicts, namely whether there was evidence enabling a reasonable man to find an affirmative or whether upon the evidence a finding was unreasonable, have no place in the examination of the validity of a domestic tribunal's decisions. But the tribunal is bound to act honestly, that is to say it must have an honest opinion that what the member before it did amounted to misconduct and its decision must be given in the interests, real or supposed, of the body it represents and not for an ulterior or extraneous motive."

And at 630-631: "The last matter relied upon as invalidating the decisions is of a more serious kind. It is that the Executive and Dougherty were both prosecutors and judges and animated by such intensity of feeling that they were disqualified by bias. So far as this contention is based upon the fact that the Executive Council promoted the charges and that they were vitally concerned in the controversy not only as members of the Union but as office bearers whose authority had been resisted, there is in my opinion no substance in it. The reason lies in the constitution of the Union. In choosing as a domestic forum a governing body and in authorising it to make enquiries and investigations of such a kind the rules necessarily bring about, if they do not actually contemplate, such a situation. Domestic tribunals are often constituted of persons who may, or even must, have taken some part in the matters concerning which they are called upon to exercise their quasi-judicial function. Nor do I think that it has been shown that any particular member, putting aside the general secretary, was disqualified by any interest or specific ground of bias attaching to him or to them all." 136 Dixon J went on to say that Dougherty, the general secretary, had engaged in bitter public attacks on the respondents, and at the hearing of the charges had assumed the functions of prosecutor. Dixon J went on, at 631: "It is true that the rules make him a member of the Council as general secretary and require the general secretary's attendance. But they do not make his presence indispensable and do not necessitate his participation in the decision of questions in which his interest or concern makes it improper. "In interpreting rules conferring jurisdiction to any tribunal, there is always to be read into them the underlying condition that the proceeding shall be carried on in accordance with the fundamental principles of natural justice. It is upon a party who wishes to shut out the implication of that basic condition to show that the rules expressly or by necessary implication negative the implication of its existence": per O'Connor J in Dickason v Edwards (1910) 10 CLR, at 255. It is not in accordance with the principles of natural justice to have present as a member of the tribunal a person who has promoted the charge and supports it as the prosecutor or one who is invincibly biased against the accused as a result of his participation in the controversy, and this was the case with Dougherty. If the person disqualified by such consideration sits with the tribunal and takes part in the decision, that is enough to vitiate it." 137 I am not satisfied that it was Mr Vaughan who in effect acted as prosecutor, or indeed that there was anyone who "acted as prosecutor" at all. While it was Mr Vaughan who had made the initial demand that Mr McClelland repay the "Mug" money, and moved motions at meetings held on 1 May (see paragraph 25 above) and 13 June (see paragraph 41 above), it was Mr Jacobs, as Honorary Secretary, who was responsible for the Supplementary Agenda put before the meeting on 16 May, and Mr Ryan who moved the motions at the meeting on 16 May (see paragraph 33 above). There was no exploration in the evidence of what transpired at either the meeting of 16 May, or of the meeting of 13 June, with a view to establishing that any particular person had "acted as prosecutor" at that meeting. Failure to Take Into Account Matters Which Should have been Taken Into Account 138 Mr McClelland complains that the meeting should have been informed about his cross-claim, and also that, while Mr McClelland had received $170, there was much more money missing, which was the overall responsibility of Mr Ryan as the Fundraising Officer. Further, he says, the meeting should have had presented to it the fact that the controls over the fundraising were slapdash. 139 While this submission was made in relation to the meeting of 16 May, I take it as also being intended to apply to the later meeting. The answer to it is in part factual, and in part a matter of principle. At the factual level, the meeting did have before it Mr McClelland's allegation of a cross-claim. Mr Jacobs' statutory declaration referred to it, and Mr McClelland's letter of 29 April 1995 was tabled at the meeting. The "larger picture" of funds missing was set out, at least in part, in Mr Vaughan's statutory declaration. 140 At the level of principle, there is no obligation on a decision-maker in the position of the Club to "make a case" for the plaintiff. Rather, what natural justice requires is that the plaintiff have a reasonable opportunity to present his case, and there is usually no obligation on the decision-maker to point out any deficiencies in the case that has been presented (Century Metals and Mining v Yeomans (1989) 40 FCR 564 at 593; Broussard v Minister for Immigration, Local Government and Ethnic Affairs (1989) 21 FCR 472 at 480-481 per Gummow J; Luu v Renevier (1989) 91 ALR 39 at 45; Sullivan v Department of Transport (1978) 20 ALR 323 at 342-343 per Deane J with whom Fisher J agreed on this topic; Minister for Immigration and Ethnic Affairs v Teoh (1995) 128 ALR 353 per Mason CJ and Deane J.) For the reasons I have earlier given, Mr McClelland had an adequate opportunity to present his case at the meeting of 13 June, and at the General Meeting. Meeting 13 June 1995 141 Mr McClelland complains that he was not supplied with any supporting material or particulars relating to the allegations against him. 142 In my view, the notice which Mr Jacobs gave him, adequately informed him of the nature of the allegation made against him. Indeed, there was never any contest about the fact that Mr McClelland had borrowed money, totalling $170, from the "Mug" money, and had not paid it back. There is no obligation on a decision-maker to provide to the person about whom the decision is being made, every piece of evidence, so long as that person has the opportunity to consider and make submissions about the substance of the allegations against him or her. In my view, Mr McClelland had that opportunity. When Mr McClelland came before Brownie J on 14 July 1995 (see paragraph 52 above) his Honour records that the notice of the meeting of 13 June was one, "… informing him in a schedule to that letter of the precise allegations made against him and setting out a procedure to be followed. Those allegations contained a considerable amount of detail, and there has been no complaint about that detail."

I respectfully agree with Brownie J's description of the notice which Mr McClelland received of the letter of 13 June. The fact that Mr McClelland did not complain to Brownie J about the adequacy of the information he had been given about the allegations supports, in my view, the conclusion that Mr McClelland well understood what the allegations were. Failure to Allow Legal Representation 143 Mr McClelland agreed in cross-examination that he could not have afforded paid legal representation at this meeting, but said that had he been allowed to, he may have been able to get legal representation without payment. 144 Pursuant to clause 15.3(c), legal representation was not to be permitted at the meeting held under clause 15.4. Under these circumstances, it could not be said that fair procedures, accorded within the structure of these rules, required that legal representation be granted. 145 Further, even in a case where the rules are silent about whether legal representation is to be allowed, there is no invariable requirement, springing from the laws of natural justice, which requires legal representation to be granted (McNab v Auburn Soccer Sports Club Ltd (1975) 1 NSWLR 54; R v Blizzard; ex parte Downs [1993] 1 Qd R 151 at 163 per Derrington J (with whom Macrossin CJ agreed, and with whom McPherson SPJ agreed on this topic). 146 Mr McClelland had some acquaintance with legal matters. He had, for several years been Tipstaff to Sir John Moore, and had worked as an industrial relations officer for several companies over a period of about seven years. In the latter capacity, he had worked almost exclusively as an adviser and in carrying out negotiations, rather than performing advocacy. I do not accept that this limited acquaintance with legal matters had the effect that Mr McClelland would have become disentitled to have legal representation, if he was otherwise entitled to have it. 147 While it was the effect of clause 15.3(c) of the Rules that Mr McClelland was not entitled to legal representation at the meeting of 13 June, there was no provision of the rules which denied him legal representation at the general meeting held on 15 July. He was never told he could not have legal representation at the general meeting. Mr McClelland did not ask for legal representation at that meeting. The Meeting of 15 July 1995 148 I have already decided that notice of this meeting was given, in accordance with the rules. Further, I reject the submission that proceedings at the meeting were so disorderly, and so littered with irrelevancies, as to taint the outcome. 149 A submission was also put that at this meeting, and indeed at the meeting of 13 June also, Mr McClelland was not aware of the allegation made against him, because of unclarity in the expression contained in the resolution "failed, without proper reason, to account to the Club for raffle monies …". He maintained this stance even in evidence: "Q. The details generally of the charges were that you failed to account for $170? A. That's the charge that I defended, Mr Bell, I sought to defend and as I saw it quite frankly how can you say - and I am a layman - how can you say that I failed to account when you are told both verbally and in writing that I had borrowed that amount of money. Q. You understood that the Committee wanted that $170 repaid? A. I understood that the Committee had waved a red herring to overcome the Sydney Branch's decision to hear an appeal on other matters. HIS HONOUR: Would you answer the question. WITNESS: The answer is no." 150 I do not accept that there was any doubt in Mr McClelland's mind about the intended meaning of "failed …. to account". Nor do I accept his evidence that he did not understand the Committee wanted the $170 repaid. At the meeting on 13 June it was quite clear to Mr McClelland that the Committee's concern was about him having taken the money and not paid it back. When, at the meeting of 15 July, Mr McClelland raised the argument that he had "accounted for" the money by writing down amounts on the beer coaster, Mr Terrett had stated that a coaster was not legally a proper accounting for the money. I accept the argument of counsel for the Club that the argument put forward that the beer coaster was a sufficient accounting was "sophistry". 151 An attempt was made in submission to cast doubt on the accuracy of the vote counting at the meeting. I am not satisfied that there was any inaccuracy. Indeed, it was not put to Mr Singleton in cross-examination that the count was in any way wrong. There was no call for a re-count, and no call that the ballots be kept. There is nothing sinister in the fact that the ballots were destroyed, when clause 16.3 of the Rules expressly requires that there be a secret ballot. Does the 15 July Meeting Cure Any Earlier Defect? 152 If I am wrong in the view that there was no invalidity, arising from failure to accord natural justice, in the proceedings of the meetings of 16 May and 13 June, a question would arise of whether the meeting of 15 July could cure any such defect. Earlier cases have held that, at least sometimes, a breach of nature justice can be cured by a later decision where natural justice is accorded. In Australian Workers Union v Bowen (No.2) (1948) 77 CLR 601 Dixon J had concluded that a resolution passed by a committee meeting attended by a biased secretary who had acted as prosecutor was void. However, his Honour held that, even so, an expulsion was valid because it was confirmed by a later general meeting. He said, at 631-632: "But there then confronts the respondents the fact that from these decisions six of them appealed to the convention. By so appealing they treated the expulsion, not as regular, but as having an operation under the rules and as proceedings to be reviewed, and, if the convention thought fit, corrected by the convention. The convention had complete authority over the whole question of expulsion, and it was for it to decide whether the findings and the dismissals from membership should be set aside, varied or confirmed. The convention confirmed them. It may be true that the convention gave them less consideration than might be thought proper. It may be true that the convention treated the dismissal of the appeals as almost a foregone conclusion. But it is the supreme authority in the Union and if a supreme authority is chosen as a domestic tribunal, particularly when it is a deliberative assembly, it may be expected to act upon views formed by the knowledge the members possess of the affairs of the body. I think that under the rules the decision of the convention gave a fresh authority to the dismissals and they no longer depended upon the resolutions of the executive council. No ground has been shown for treating the conventions decisions as void, or for invalidating it."

(See also at 618 per Latham CJ, 619 per Rich J.) 153 In Twist v Randwick Municipal Council (1976) 136 CLR 106 at 116 Mason J said: "Further, the earlier cases should not be regarded as deciding that the presence of an appeal to another administrative body is an absolute answer to a departure from natural justice or the standard of fairness. The existence of such an appeal does not demonstrate in itself that the inferior tribunal is at liberty to deny a hearing. But if the right of appeal is exercised and the appellate authority acts fairly and does not depart from natural justice the appeal may then be said to have "cured" a defect in natural justice or fairness at the first instance. Certainly this view has been taken in a number of cases - notably by the Privy Council in De Verteuil v Knaggs [1918] AC 557; Pillai v Singapore City Council [1968] 1 WLR 1278, at 1286 and by the Supreme Court of Canada in Re Clark and Ontario Securities Commission (1966) 56 DLR (2d) 585 and King v University of Saskatchewan (1969) 6 DLR (3d) 120; cf Denton v Auckland City [1969] NZLR 256 and Leary v National Union of Vehicle Builders [1971] Ch 34 where the contrary view was taken. In this conflict of authority my preference is for the approach taken by the Privy Council and the Supreme Court of Canada: first, because the party affected has elected to treat the administrative decision as a valid, though erroneous decision, by appealing from it, in preference to asserting his right to a proper performance by the authority of its duty at first instance; and secondly, because in some cases the court will be compelled to take account of the public interest in the efficiency of the administrative process and the necessity for reasonably prompt despatch of public business and balance that interest against the countervailing interest of the individual in securing a fair hearing - in appropriate cases that balance will be achieved if the individual secures a fair hearing on his appeal."

(See also Calvin v Carr [1980] AC 574; R v Marks; ex parte Australian Building and Construction Employees and Builders Labourers Federation (1981) 147 CLR 471 at 485; Preston v Carmody (1993) 44 FCR 1 at 14-18 per Wilcox J.) 154 It has been held that, to be able to effect a cure of any earlier defect in procedure, the appeal procedure must be a full re-hearing, at which the person charged has the opportunity to address all matters relevant to both guilt and penalty, and where the appeal body has full power to substitute its own view for that of the decision maker appealed against: Colpits v Australian Telecommunications Commission (1986) 9 FCR 52, at 65. 155 There are numerous authorities to the effect that a decision or recommendation which is beyond power, by reason of breach of rules of natural justice, is not totally void in the sense of being legally non-existent, but is, at least in some circumstances, capable of being appealed against, Calvin v Carr [1980] AC 574, Twist v Randwick Municipal Council (1976) 136 CLR 106 at 116, Forbes v New South Wales Trotting Club Ltd (1979) 143 CLR 242 at 277 per Aickin J (with whom Steven J agreed); Parkes Rural Distributors Pty Ltd v Glasson (1986) 7 NSWLR 332 at 336A-B, 338A-B per Glass JA with whom Samuels and Priestley JJA agreed; Macksville & District Hospital v Mayze (1987) 10 NSWLR 708 at 716-719 per Kirby P, 729D-730D per Mahoney JA (with whom Priestley JA agreed); Clisdell v Commissioner of Police (1993) 31 NSWLR 555. 156 However, the decision about whether the appeal to the meeting on 15 July cures any earlier defect in the proceedings does not depend on the direct application of the decisions in earlier cases. Whether the full opportunity which Mr McClelland was given to address the meeting on both guilt and penalty on 15 July cures any earlier defect, depends in part on his election to treat the earlier decision as a decision within the scope of the rules, by appealing against it, and in part upon the construction of the rules themselves. As well, section 18(3) of the Associations Incorporation Act (see paragraph 105 above) has the effect, it seems to me, that even if an association passes a resolution for expulsion in a way which is prohibited by its rules, that is not a sufficient reason for the expulsion to be invalid. 157 Clause 15.6 of the Rules makes clear that, if an appeal against a decision of the Committee under clause 15.4 is lodged, the decision of the Committee is to be of no effect unless and until a general meeting confirms the resolution. This shows, in my view, that the general meeting has full power to decide matters of both guilt and penalty. If an appeal is lodged, the rules themselves provide that there is no effective resolution of expulsion or suspension until that appeal is dealt with. As a matter of construction, and bearing in mind section 18(3) of the Act, it seems to me that the right of appeal to the general meeting is conferred in relation to not only valid decisions of the Committee under clause 15.4, but also in relation to purported decisions of the Committee under clause 15.4. If there had been a breach of natural justice in the decisions of the Committee, concerning some matter which the rules, properly construed, required to happen, those decisions would be, for that reason, defective decisions, but not (because of section 18(3)) invalid. Even though they were defective, they would be purported decisions of the Committee. When there is an appeal instituted, within the confines of the rules, against such a purported decision, and the General Meeting acting in accordance with the rules decides to confirm the expulsion, that expulsion is effective. Laches 158 The defendant relied upon two factors, beyond mere delay, in submitting that a defence of laches should succeed. These were that the evidence of Mr Vaughan was not available to it, because of his illness, and that Mr Gray (the second scrutineer at the meeting on 15 July 1995) had died some years before the trial. Because I have come to the view that the expulsion was effective, the decision of the case does not require me to decide whether the plaintiff has engaged in laches of a type which would disentitle him to an order. Orders

2 Plaintiff to pay defendant's costs. **********

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