Muslims New South Wales Inc v Australian Federation of Islamic Councils Inc; Australian Federation of Islamic Councils Inc v Muslims New South Wales Inc

AFIC

1. The Constitution provides that membership of AFIC includes a representative body (called a "State Council") from each state and territory and various local bodies (called "Societies") from within the states and territories. Each State Council is formed by the Societies for that state or territory. There is a debate, to which I refer below, as to whether individuals who are members of those Societies are themselves also members of AFIC.
2. MNSW is a State Council, and thus a member of AFIC.
3. AFIC has three governing bodies: 1. an Executive Committee, consisting of six office-bearers and three other members, each of whom is required by cl 26(a) of the Constitution to be a member of a Society; 2. a Federal Council, consisting of four of those office-bearers and a representative of each State Council; and 3. the Federal Congress.

The Federal Congress

1. The Federal Congress is the "highest policy-making organ" of AFIC and has the "ultimate responsibility to achieve the objects and purposes" of AFIC (Constitution cl 8).
2. Federal Congress must meet annually within four months from the end of the financial year (cl 35(1)). "Special Meetings" of Federal Congress can occur at any time, but (according to the Constitution, and subject to s 22A of the Act; see below) only on the requisition of at least four State Councils (cl 34(2)(b)).
3. The Federal Congress "consists" of members of the Executive Committee and of delegates representing the State Councils (cl 11) and each Society (cl 12(2)).
4. One delegate from each State Council and each Society and the members of the Executive Committee may attend meetings of Federal Congress: cl 12(1), (2) and (4). If (as is the case in Tasmania) a Society is acting as a State Council, that Society may send two delegates to Federal Council meetings: cl 12(3). "Other members" (I will return to this: see [41] below) may attend meetings of Federal Congress "and participate in discussions" if "permitted to do so by the Chairman": cl 36(1).
5. Each such delegate, and one representative (only) of the Executive Committee has a vote at meetings of Federal Congress; "other members" may not vote: cll 36(1) and 46(1).

Section 22A of the Act

1. Section 22A of the Act, which was inserted into the Act in 1986 (some six years after AFIC was incorporated) provides: "Notwithstanding any provision in its rules [which includes the Constitution: see [11] above], a general meeting of an incorporated association may be called by not less than 10 per cent of the members of the association entitled under the rules of the association to vote at a general meeting."
2. The Constitution does not refer, in terms, to a "general meeting". It refers only to a meeting of Federal Congress and, as I have said, in the case of a Special Meeting of Federal Congress, provides in cl 34(2)(b) (inconsistently with s 22A) for its requisition only on the request of at least four State Councils (see [16] above). Thus, if a meeting of Federal Congress is also a "general meeting" of AFIC, s 22A prevails and such a meeting can be called on the requisition of 10 per cent of AFIC members entitled to vote, notwithstanding cl 34(2)(b) of the Constitution.

The 4 February 2016 requisition

1. On 4 February 2016, MNSW, together with a number of other State Councils (together comprising more than 10 per cent of AFIC members entitled to vote), called for the holding of a "Special Meeting" of the Federal Congress on 6 March 2016, with the stated object of passing a motion of no confidence in the members of the Executive Committee (which, if effective under the Constitution, would have disqualified them from office: cl 28(1)(c)(iv)). I will call this document "the Notice".

Was the effect of the Notice to convene a meeting of Federal Congress?

1. It is common ground that the Notice was effective to convene a "general meeting" of AFIC for the purpose of s 22A of the Act.
2. What divides the parties is whether the Notice was also effective to convene a meeting of the Federal Congress.
3. If it was, the effect of the Notice was to convene a meeting which was both a general meeting and a meeting of Federal Congress, and thus a meeting empowered to pass a motion of no confidence in the members of the Executive Committee and thereby secure their disqualification from office (cl 28(1)(c)(iv)).
4. If it was not, the effect of the Notice was to call only a general meeting of AFIC, which was governed by the Model Rules (as the Constitution makes no provision for a general meeting). The Model Rules do not confer on a general meeting power to remove office-bearers.
5. The term "general meeting" itself suggests a meeting where members may meet in that capacity; as members. Such a meeting may be a general meeting, even if there are some limitations on members' rights (for example, as to voting): A D Lang, Horsley's Meetings - Procedure, Law and Practice, (7th ed 2015, LexisNexis) at [1.17].
6. Section 22A of the Act speaks of a general meeting called for by "members" of the Association "entitled under the rules of the association to vote" at such a meeting. The Model Rules define "general meeting" to be "a general meeting of members". Those provisions suggest that the "general meeting" to which the Act refers is one at which members "entitled to vote" may attend.
7. On the face of it, a meeting of Federal Congress is such a general meeting. It is a meeting of representatives of AFIC's members at which all members entitled to vote may attend.

AFIC's submissions

1. However, Mr Ashhurst SC (who appeared with Mr Rogers for AFIC) submitted that a meeting of Federal Congress is not a general meeting of AFIC because "a Congress meeting allows non-members (the Executive Committee) to have a vote in proceedings and a Congress meeting also varies the voting rights of some of the members from that which would be allowed at a general meeting."

The "non-member" point

1. As to the first of those submissions, Mr Ashhurst submitted that a meeting of a body could not be a "general meeting" if persons or entities who were not members of the body could attend and vote. Mr Ashhurst submitted that such a meeting would be "analogous to a joint venture where entities outside the organisation who are not members are given voting rights".
2. The Executive Committee is not a separate entity. It is comprised of its members. And those members must be members of a Society: cl 26(a).
3. There was thus implicit in this point the proposition that individuals who are members of Societies (which Societies are members of AFIC) are not themselves members of AFIC.
4. In my opinion, they are.
5. It is clear that State Councils and their constituent Societies are members of AFIC. There was no controversy about this before me.
6. Thus: 1. clause 5(1) of the Constitution states, consistently with AFIC's name, that "the Federation shall consist of State Councils" and goes on to state that such State Councils are "themselves formed by the local AFIC member societies of each State or Territory of Australia"; 2. clause 5(3)(c) speaks of "admission to the Federation as a member by a Society" and of a Society being admitted "as a member of the Federation" upon various conditions being satisfied; and 3. clause 5(7) speaks of "member societies" being those that have paid their "membership subscription" to AFIC.
7. As to whether individuals who are members of Societies are themselves members of AFIC, cl 5(3)(b) speaks of persons being members of AFIC "by virtue of membership in a Society" (and provides that such a person may not enrol as a member of another Society unless "he" resigns "his" membership in the first Society). That points to the conclusion that individual Society members of themselves AFIC members.
8. Clause 3 of the Constitution states that "unless there is something in the subject of context inconsistent therewith" the expression "Member of Federation" means: "…a person who is a member of a Society and a State Council which has contributed a subscription to the Federation as provided by this Constitution, such Society or State Council being entitled to be represented at the Federal Congress in accordance with this Constitution".
9. That definition also points to the conclusion that membership of AFIC includes any person who is a member of a Society or State Council.
10. As Mr Ashhurst pointed out, read literally and without reference to other provisions in the Constitution, that definition might suggest that only such persons are members of AFIC. Of course, that could not be right; Societies and State Councils are clearly members.
11. Clause 36 deals with who may attend meetings of Federal Congress. Clause 36(1) provides that delegates representing State Councils and members of the Federal Executive may attend. Clause 36(2) then provides that "other members" of the Federation may attend and "participate in the discussions, if permitted" by the Chairman. In context, "other members" could not refer to Societies, which are entitled to attend and vote at meetings of Federal Congress (cll 12(2) and 46(1)) and would thus not need the Chairman's permission to attend. Thus "other members" must be some other category of membership. That could only be, or would at least include, individuals who are members of the Societies.
12. In my opinion, these provisions compel the conclusion that individuals who are members of Societies are entitled to be members of AFIC. In my opinion, the definition in cl 3 should be read as an inclusive, and not exclusive statement of membership entitlement.
13. For those reasons, I do not accept the "non-member" point.

The "variation of voting rights" point

1. As to the second of the points made by Mr Ashhurst at [30], Model Rule 18 provides that at a general meeting "a member has one vote only" whereas the Constitution effectively confers on one category of AFIC member (a Society that is also a State Council) two votes, as such a Society may send two delegates (each with one vote) to meetings of Federal Congress (see [18] and [19] above).
2. I do not see how this casts light on the question of whether a meeting of Federal Congress is a general meeting.
3. By reason of s 16(3) of the Act, the Model Rules must give way to the Constitution to the extent of any inconsistency (see [11] above). Although the result is that one category of AFIC members has more votes than others, that does not alter the fact that all members of AFIC entitled to vote may attend Federal Congress meetings.
4. Accordingly, I do not accept the "variation of voting rights" point.

The "not in the capacity as a member" point

1. In oral submissions, the suggestion arose that even if individual members of Societies are themselves members of AFIC, the fact that a representative member of the Executive Committee is entitled to attend and vote at a meeting of Federal Congress (whereas other individual members may only attend and participate at such meetings with the permission of the Chairman and may not vote: see [18] and [19] above) might be seen to reveal that such a meeting is not a general meeting of AFIC. That is because, it was suggested, such a person would not be attending the meeting in that person's capacity as a member of AFIC, but as a member of the Executive Committee.
2. It is true that the entitlement of the member of the Executive Committee, nominated by that Committee to be its representative at a meeting of Federal Congress, to attend and vote derives from that person's position as a member of the Executive Committee, rather than as an individual member of AFIC.
3. But any such person must also be a member of AFIC, as cl 26(a) requires that a member of the Executive Committee be a member of a Society. For the reasons set out above, my opinion is that such a person is a member of AFIC.
4. Thus, although it could be said that such a person's attendance at a Federal Congress meeting is in that person's capacity as the representative of the Executive Committee, and that such a person is in a different position from other individual members (who have no entitlement to attend and vote), the fact remains that the meeting is one at which only members may attend and vote.
5. For that reason it is, in my opinion, a general meeting.
6. For those reasons, I do not accept the "not in the capacity as a member" point.

Conclusion: a meeting of Federal Congress is a general meeting of AFIC

1. For those reasons, my conclusion is that a meeting of the Federal Congress of AFIC is also a general meeting of AFIC.
2. Therefore, by reason of s 22A of the Act, and notwithstanding cl 34(2)(b) of the Constitution, a Special Meeting of AFIC's Federal Congress can be convened on the requisition of 10 per cent of AFIC members entitled to vote.
3. For those reasons, the meeting of 6 March 2016 was not only a general meeting of AFIC, it was also a meeting of the Federal Congress of AFIC.

Some alarming consequences if that be wrong

1. It was odd that AFIC would advocate the construction of its Constitution the subject of Mr Ashhurst's submissions, as some alarming consequences would flow from a conclusion that a "general meeting" of AFIC is something different from a meeting of its Federal Congress.
2. One is that, as the Constitution makes no provision for the holding of a "general meeting" (assuming, contrary to my conclusion that this is something different from holding a meeting of Federal Congress), and as s 22A of the Act permits the calling of a "general meeting", the calling and holding of such meetings would be governed by the Model Rules.
3. Those Rules require that an association, such as AFIC, hold an annual "general meeting" at which a number of matters required by the Constitution be dealt with by Federal Congress (for example, the election of office-bearers and the appointment of an auditor: cll 32 and 57(1)) be dealt with.
4. That has never occurred.
5. Further, by reason of ss 18(1) and 23(1) of the Act, the rules of an association such as AFIC can only be altered by a special resolution passed at a "general meeting" (whereas cl 57(1) of the Constitution provides for constitutional amendments to be made by special resolutions passed at both a meeting of Federal Congress and Federal Council). Thus if meetings of Federal Congress are not also "general meetings", any purported amendments made by Federal Congress and Federal Council to the Constitution in the last 36 years during which AFIC has existed are of no effect.

Conclusion

1. I invite the parties to bring in short minutes to give effect to these reasons (including the making of declarations to the effect of those at [7], but which should also take into account my conclusion that what occurred on 6 March 2016 was a validly convened meeting of Federal Congress).
2. I will hear the parties as to costs.

Amendments 18 July 2016 - Coversheet amended DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 18 July 2016