Plaintiff v Plaintiff

Supreme Court of Victoria|2011-12-02|Before: GARDINER AsJ

Associations Incorporations Act - Section 36CA - Distribution of surplus assets of church incorporated under Associations Incorporation Act 1981 at conclusion of winding up - Surplus distributed to bodies which had similar objects and purposes to liquidated church and whose constitutions proscribed distributions of surplus assets to their members in the event of any liquidation or dissolution.

2 On 5 November 2009 the board of directors of the Church resolved that it be placed into voluntary administration and that Mr Andrews be appointed as administrator.

3 In December 2009, Mr Grant Taylor, the former Senior Pastor of the Church, made application to this Court seeking to restrain Mr Andrews from conducting the second meeting of creditors required to be convened under s 439A of the Corporations Act 2001 on the ground that Mr Andrews' appointment as administrator was not valid by reason that the board appointing him was invalidly constituted. On 16 April 2010 Davies J dismissed that application.[1]

4 On 4 May 2010, a second meeting of creditors of the Church was held. It was resolved that the Church be wound up and that Mr Andrews be appointed as liquidator pursuant to s 439C of the Act.

5 On 5 August 2011 Mr Andrews made application by originating process seeking orders under s 36CA(6)(b) of the Associations Incorporation Act and ss 477(6) and 511(1)(b) of the Corporations Act 2001 in respect of the distribution of the surplus assets of the Church upon completion of the liquidation.[2] That surplus is of the order of $2.5 million to $3 million.

6 Mr Andrews relies on three affidavits sworn by him in support of the application, dated 4 August 2011, 8 September 2011 and 16 November 2011 and an affidavit of Chantal Reigo sworn 18 November 2011.

7 Notice of the making of this application was advertised in The Age newspaper on 10 August 2011 and in the Diamond Valley Leader, a local newspaper circulating in the immediate neighbourhood of the Church, on the same date.

8 Section 31M of the Associations Incorporation Act imports into the context of incorporated associations the voluntary administration provisions of Part 5.3A and Division 3 of Part 5.9 of the Corporations Act, subject to some modifications. In the same way, s 36D provides that the voluntary winding up of an incorporated association under Division 1 of Part 8 of the Associations Incorporation Act is, subject to certain modifications, an applied corporations legislation matter for the purposes of Part 3 of the Corporations (Ancillary Provisions) Act 2001 in relation to the provisions of Part 5.5 (voluntary winding up) and 5.6 (winding up generally) of the Corporations Act. Without descending to a close analysis of the effect of these provisions, they have the effect of importing the winding up provisions of the Corporations Act into the winding up of incorporated associations.

9 Section 36CA of the Associations Incorporation Act provides relevantly:

(1) In this section surplus assets, in relation to the winding up of an incorporated association, means those assets remaining after satisfaction of the debts and liabilities of the incorporated association and the costs, charges and expenses of the winding up.

(2) Subject to subsections (3) and (4), an incorporated association must not distribute any surplus assets available for distribution at the completion of the winding up of the incorporated association under this Part, to -

(a) any member or former member of the incorporated association; or

(b) to any person to be held on trust for any member or former member of the incorporated association.

(3) The surplus assets of an incorporated association that is in the process of winding up may be distributed to a member or former member if -

(a) the member or former member is a body corporate or an association (whether incorporated or not) and the Registrar is satisfied that -

(i) at the time of the distribution, the body corporate or association is prevented by its rules or otherwise from distributing the surplus assets to its members; and

(ii) the distribution is not contrary to this Act or the regulations; or

(b) the member or former member is a trustee who holds, or held, membership of the incorporated association on behalf of a trust and the Registrar is satisfied that -

(i) at the time of the distribution, the trustee is prevented by the terms of the trust or otherwise from distributing the surplus assets to the beneficiaries of the trust; and

(ii) the distribution is not contrary to this Act or the regulations.

(4) ...

(5) Subject to this section and any court order, the surplus assets of an incorporated association are, on the winding up of the incorporated association, to be distributed in accordance with -

(a) the rules of the incorporated association; or

(b) if there are no valid rules of an incorporated association governing the distribution of any surplus assets, by a special resolution of the incorporated association.

(6) The Supreme Court may make an order relating to the distribution of the surplus assets of an incorporated association on a winding up on the application of -

(a) the Registrar; or

(b) a liquidator of the incorporated association; or

(c) a member of an incorporated association; or

(d) any person aggrieved by the operation of this Division in relation to the surplus assets of an incorporated association.

(7) The Supreme Court may make an order under subsection (6) permitting the distribution of surplus assets to its members.

(8) The Supreme Court, in making an order under subsection (6), must have regard to any relevant rules and the purposes of the incorporated association.

(9) This section applies subject to any trust affecting all or any of the assets of the incorporated association.

10 Mr Andrews makes application as the liquidator of the Church under s 36CA(6)(b). While subs (7) provides that the Court may make an order under subs (6) permitting the distribution of surplus assets to its members, subs (8) provides that the Court must have regard to the relevant rules and the purposes of the organisation.

11 Prior to Mr Andrews' appointment as administrator, there was conflict within the assembly of the Church which arose from the standing down and ultimate removal of Mr Taylor as Senior Pastor. Mr Andrews describes such events in his affidavit of 5 August as the "Senior Pastor matters". By reason of the Senior Pastor matters, a number of members of the Church apparently left the assembly. There remained at least two factions in the assembly with different outlooks as to the future role and function of the Church.

12 Following his appointment, Mr Andrews obtained the books and records which consisted of financial accounts, supporting documentation including invoices and receipts, bank statements and other accounting materials.

13 In his evidence, Mr Andrews describes the general financial position of the Church. It had a very small cash balance in its account with the National Australia Bank and unsecured creditors at the date of his appointment of $8,512.72 as well as the secured debt referred to below.

14 The Church is the registered proprietor of land on four separate titles at Nyora Road, Eltham ("the properties"). Mr Andrews deposes that it is his understanding that, as at 8 April 2010, those properties were collectively valued at between $2.5 million and $3 million. One of the properties was subject to a mortgage which secured amounts owing to the National Australia Bank of approximately $250,000 at the date of his appointment. That mortgage was subsequently refinanced with the Properties Corporation of the Churches of Christ ("the Properties Corporation"). The balance owing under that mortgage as at 30 June 2011 was $276,217.75 and caveats have been lodged over each property to secure the refinanced loan.

15 The Church is governed by its Statement of Purposes and Constitution. Of particular significance in the context of the present application is cl 30 of that document, which provides:

Disseminating funds upon dissolution

If upon the winding up or dissolution of the Assembly there remains, after satisfaction of all its debts and liabilities, any property whatsoever, the same shall not be paid or distributed among the members of the Assembly but shall be given or transferred to some other Assembly or institution or institutions having objects similar to the Statement of Purposes of the Assembly and whose constitution shall prohibit the distribution to its or their members to an extent at least as great as is imposed on the Assembly under or by virtue of clause 34[3] hereof, such institution or institutions to be determined by members of the Assembly at or before the time of dissolution and in default thereof by application to the Supreme Court for determination.

16 It will be seen that clause 30 imposes certain restrictions on the distribution of any surplus on a winding up of the Church. They are that the members of the Assembly of the church are not to receive a distribution of the surplus property, rather it is to be given or transferred to some other assembly or institution having objects similar to those set out in the Statement of Purposes of the Assembly. The body which receives such a transfer of the surplus must have a constitution which prohibits the distribution to its members to an extent at least as great as that imposed on the Assembly under the Church's rules. In default of a determination by the members of the Assembly at or before the time of dissolution of the Church, such distribution can be determined by application to this Court.

17 The "Statement of Purposes for the Assembly" which is mentioned in cl 30 of the rules identifies 10 purposes as follows:

Statement of purposes

The purposes of the Assembly are:

To propagate the message of the Christian faith and to promote and encourage the worship of God as sovereign Lord and Creator of all things, through the regular gathering together of members and adherents.
To engage in evangelism by all means possible.
To establish self-governing, self-propagating local churches as the opportunity affords.
To uphold the family as the basic social unit of society.
To provide Christian and General education for all age groups and to encourage training for active ministry at home and abroad to establish, support and conduct Christian Colleges and Schools of Education.
To release the divinely bestowed ministry gifts of Christ into full operation.
To support and engage in missionary enterprise in Australia and other lands with the view to establishing and or strengthening indigenous local churches.
To encourage an attitude of Christian fellowship towards all believers in Christ irrespective of doctrinal or denominational differences.
To honour all civil governing authorities according to the Biblical Scriptures.
To affiliate and co-operate with, for any length of time:[4] whatever Protestant denomination in Australia or oversees that the congregation finds it expedient and useful to do so.

18 It will be seen that the Statement of Purposes for the Assembly includes such matters as the propagation of the Christian faith, evangelism, i.e. the promulgation of the Gospel, the provision of Christian education and the encouraging of Christian fellowship.

19 Subsequent to the publicity given to this matter, Mr Andrews has been approached by two religious bodies who are interested in receiving a distribution of the surplus assets of the Church. They are the Churches of Christ and the Eltham Baptist Church. Mr Andrews requested those bodies to provide copies of their constitutions and other relevant documentation to enable consideration of the present issue before the Court.

20 Such an exercise involves discerning whether the constitution of the proposed candidate for receipt of the surplus prescribes similar objectives to the Church and a prohibition on a distribution to its members of an extent at least as great as that contained in the Church's constitution. It is also relevant to take into account matters such as the involvement that the recipient candidate has had in the Church's activities and other features which would point to an affinity with the Church's ethos and philosophy.

21 The Church of Christ provided Mr Andrews with a copy of a document entitled the Constitution and Statement of Purposes of the Conference of Churches of Christ in Victoria and Tasmania. He was provided by the Eltham Baptist Church with a copy of its Constitution and other associated material.

22 The Churches of Christ Constitution, which contains a statement of purposes for that church in Victoria and Tasmania, describes, under the heading "Mission Strategy", the ethos of the Churches of Christ. It identifies the following as "aspects of New Testament Christianity that make up the distinctive ideology of the Churches of Christ" as follows:

(i) Mutual ministry of Christian believers.

(ii) Congregational autonomy with a commitment to the other churches of our movement through our conference structures.

(iii) Simplicity and vitality of worship.

(iv) Weekly communion.

(v) Witness to, and practice of believers' baptism by immersion.

(vi) Commitment to extending the kingdom of God and the making of disciples through a passion for sharing "the good news".

(vii) Working for social justice, equality and the responsible care of our environment and all of God's creation.

(viii) Being a servant church, responding to human needs.

(ix) Concentrating on the essentials rather than the nonessentials of the Christian faith.

(x) Allowing for wide diversity of Christian understanding, practices and beliefs.

(xi) Recognizing as Christians all who accept Jesus as Saviour and Lord and an openness to close cooperation with other Christians in worship, witness and service.

(xii) Promotion of the unity of all God's people, maintaining a passionate commitment to the ultimate goal of visible unity.

(xiii) Affirming the centrality of the scriptures as our authority for Christian belief and practice.

23 I consider that the constitution of the Churches of Christ reveals an ethos and objectives which are much akin to those of the Church. Further, paragraph 18 of the Constitution of the Conference of the Churches of Christ in Victoria and Tasmania provides for a prohibition on the distribution of assets to its members as follows:

Non-profit organisation

The assets and income of the Conference shall be applied solely in furtherance of its statement of purposes and no portion shall be distributed directly or indirectly to the members of the organisation except as bona fide compensation for services rendered or expenses incurred on behalf of the organisation.

24 The Churches of Christ in Victoria Property Act 1941 prescribes the terms upon which the Churches of Christ holds property in Victoria. Section 3 of the Act incorporates a body entitled "The Properties Corporation of the Churches of Christ" (i.e. the Properties Corporation). Section 3(1) provides for the ability of the Properties Corporation to hold and enjoy real and personal property of any description. Section 4 provides that the property of the Properties Corporation be held upon the trusts set out in Schedule 1 of the Act.

25 While the Churches of Christ in Victoria Property Act 1941 and Schedule 1 of that Act permit the sale of its property, the proceeds of such sale are required to be applied for the furtherance of the purposes of the Churches of Christ.

26 The Constitution of the Eltham Baptist Church is expressed in quite a different idiom to that of the Church and the Churches of Christ. It does not contain a statement of purposes as such. Paragraph 2.1 of the constitution provides:

2.1 The Church is a body of Christian people who have responded to the Word of God and the call of the Holy Spirit and have been united to Jesus Christ and to his people in their own confession of faith and in their baptism.

2.2 The Church baptises professing believers, in the name of the Father, the Son and the Holy Spirit, as a sign of their salvation and their initiation into the membership of the body of Christ. Wherever practicable, baptism is practised by immersion into water as the form of baptism normative in the New Testament because it portrays "going down" into death with Christ and "coming up" into resurrection with Christ.

2.3 Affirming Baptist understandings of the Gospel, the Church is a member church of The Baptist Union of Victoria and accepts as expressions of the Christian faith the Doctrinal Basis and the Principles and Ideals of the Baptist faith contained in the Constitution of that Union and printed as Appendices I and II to this Constitution.

28 Paragraph 2.5 of the constitution, which is headed "Mission Statement", provides:

celebrating the lordship of Jesus Christ,
communicating the good news with integrity,
training people to maturity of faith,
encouraging wholeness as a spiritual community,
commitment to the mission and character of God's Kingdom.

29 Because of the length of Appendices I and II, I have annexed them as a schedule to these reasons. An examination of them reveals that in broad terms the Eltham Baptist Church shares similar objectives to the Church and the Churches of Christ. The exercise of comparison is complicated by the difference in the idiom of the respective churches but when one distils their substance, all three organisations appear to be carried on for similar purposes and objects.

30 Prior to the enactment of the Baptist Union Incorporation Act 1930, the individual Baptist churches in Victoria were unincorporated bodies the property of which was held on trust by the trustees as referred to in the preamble of that Act. The Act created a body corporate by the name of the "Baptist Union of Victoria" which was to have perpetual succession, a common seal and which could sue and be sued in its own name. Upon its enactment, the property previously held by the trustees of the various Baptist churches in Victoria was vested in the Baptist Union and from that time the Union was the entity by which the Baptist Churches in Victoria held property. Section 2 of the Act makes reference to Schedule B to the Act which sets out the general tenets and doctrines of Victorian Baptist Churches.[5]

31 The constitution of the Eltham Baptist Church appends as Appendix III what purports to be a plain English summary of Schedule B to the Baptist Union Incorporation Act 1930. It states:

Money received by the Church.[6]

7.1 raised by way of mortgage by way of Church property;

7.2 derived by a sale of Church property;

7.3 received as an insurance payout in relation to Church property;

must be used for further property purchase or building improvement. Moneys so derived are deposited with the union[7] in the normal course until the Church directs the use of the money.

32 Paragraph 15 of Appendix III summarises the effect of clause 15 of Schedule B. It states:

If:

15.1 the Church is dissolved;

15.2 the Church is dispersed;

15.3 the membership of the Church is reduced below six; or

15.4 public worship in the Church sentry property stops for six months (not being for building alterations) the Union automatically assumes full control of the Church property. [At this stage any proceeds of sale of church property by the Union would be deposited in the Union's advancement fund.] (words in parentheses in original text)

33 When this matter first came on for hearing on 9 September 2011, Mr Andrews proposed that the Court should order that the surplus assets of the church be distributed to the Church of Christ by a transfer to the Properties Corporation because it met both the similar purposes criterion and the distribution restriction mentioned in r 30 of the Church's Statement of Purposes. If the surplus was transferred to that body, the properties at would then be held subject to the trust created by the Churches of Christ in Victoria Property Act 1941. As has been observed, those trusts upon which real property is held are set out in the Schedule 1 to that Act and, while giving that body the power to sell property, the moneys received from such sale are required to be applied for the purposes of the Churches of Christ. It was contended on Mr Andrews' behalf that the provisions of the Churches of Christ of Victoria Property Act therefore fulfilled the distribution restriction to which the Court must have regard to in making an order under s 36CA(8).

34 I indicated to Dr Button of Counsel who appeared on behalf of Mr Andrews that I required further evidence as to why Mr Andrews considered that the Churches of Christ was to be preferred to the Baptist Church. In particular, I asked for elaboration of what Mr Andrews describes in his initial affidavit as the "preexisting affiliation" of the Church with the Conference of the Churches of Christ and support for the assertion that the Church has, from time to time over the years, sought assistance from the Conferences of the Church of Christ on Church matters. Mr Andrews had said in his initial affidavit in support of this application that during the course of the Church dealing with the Senior Pastor matters, the elders of the Church sought assistance from the Conference of the Churches of Christ and that conference offered support and guidance to the congregation as to how to resolve that disharmony.

35 Mr Andrews deposes in his affidavit of 16 November 2011 that he has written to both the Churches of Christ and the Eltham Baptist Church requesting that they submit to him any material that they wish to put forward to establish an association between them and the Church. Both the Churches of Christ and the Eltham Baptist Church have since provided Mr Andrews with a large volume of documentation to which he had not previously been privy in support of the respective submissions that they each have longstanding affiliations with the Church and as such an entitlement to the Church's surplus assets in its liquidation.

36 The Churches of Christ provided Mr Andrews with evidence of a formal administrative affiliation process going back to 1999, by which at its annual general meeting, its members passed a resolution that the Church would become affiliated and be known as a Church of Christ Church. Since 1999 the Church has paid annual membership fees to the Churches of Christ for provision of services including the Churches of Christ's involvement in assisting the Church through the Senior Pastor Matters. The further evidence obtained reveals that that assistance included members of the Conference attending the Church, speaking to and addressing the Church members and undertaking a process described as a Church Health Consultancy. In addition, members of the Conference became elders of the church. Mr Andrews considers that because of this what he describes as an existing relationship with the Conference, the Conference has an understanding of the Church, by which I take it to mean it identifies with its ethos and philosophy.

37 The Eltham Baptist Church currently leases one of the four parcels of land which form part of the properties. It is used during the week but not for services on the weekend. Mr Andrews says that members of the Eltham Baptist Church have been worshipping at the church at the Eltham site and some members of the assembly of the Church appear to have joined the Eltham Baptist Church congregation.

38 Mr Andrews deposes that on 11 November 2011 representatives of both churches met and agreed upon a resolution between them as to the matter. Their agreement implementing the resolution is evidenced by a deed of settlement and release executed on that date. Mr Andrews deposes that he has been told by his solicitors that they have explained to each of the legal representatives of the Churches that while an agreement might have been reached between them, approval for that agreement must still be obtained from the Court and until that occurs the terms of the deed are of no effect.

39 The parties to the deed are the Properties Corporation, the Baptist Union of Victoria and the Eltham Baptist Church. Its terms are somewhat complex. The deed provides that Mr Andrews be requested to seek orders from this Court that the assets of the Church be transferred to the Properties Corporation in exchange for it discharging the Church's liabilities. The deed also provides that within 90 days of the date of the deed, the properties be transferred to the Properties Corporation, the members of the Eltham Baptist Church give approval to this in accordance with its constitution and obtain finance to enable the payments required to be made under the deed to be made. The Properties Corporation will then transfer the properties to the Baptist Union of Victoria to be held on trust for the Eltham Baptist Church. The Eltham Baptist Church will pay the Properties Corporation the amount which was required to be paid by the Properties Corporation to discharge the liabilities of the Church (which are estimated in the deed to be approximately $500,000), the amount required to reimburse the Properties Corporation the sum it has paid in legal expenses in connection with the Church and its liquidation on a "full" indemnity basis capped at $50,000 plus GST, together with a further sum of $200,000 plus GST.

40 If those events do not occur within the time prescribed by the deed, the deed provides that the Properties Corporation will sell the properties with vacant possession and upon settlement distribute the proceeds first, in discharging the costs and commissions incurred in the sale, secondly, the amount required to reimburse the Properties Corporation for the amounts paid by it in discharging the Church's liabilities, thirdly, to Properties Corporation the amount incurred by it in legal expenses in connection with the Church and its liquidation (again on a full indemnity basis limited to $50,000 plus GST) and fourthly, a payment to Properties Corporation of the amount of $200,000 plus GST. The residue is to be paid to Eltham Baptist Church.

41 The deed provides that Eltham Baptist Church will be permitted to continue to occupy the properties on the same terms and conditions as it presently occupies the property.

42 As I have observed, the terms and operation of the deed are somewhat labyrinthine and convoluted. To paraphrase Mr Andrews, he considers that the agreement reached represents an appropriate mechanism for distribution of the surplus assets of the Church, as the two churches which are best suited and qualified to benefit from the transfer of the assets are in agreement as to how those assets are to be distributed. He says that no other entity has expressed an interest in taking a transfer of the Church's surplus assets.

43 In the circumstances, I am satisfied that what is proposed under the deed of 11 November 2011 will implement an appropriate distribution of the surplus assets of the Church. The Eltham Baptist Church and the Church of Christ have both been demonstrated to have an intimate affiliation and a close constitutional affinity with the Church. The constitutions of both bodies proscribe distribution of their assets to their members on their liquidation or dissolution. I consider that such a distribution meets the criteria which I am required to apply under the provisions of s 36CA of the Associations Incorporation Act.

44 I will make orders as proposed in the proposed minutes of orders submitted to me at the hearing on 18 November 2011. Those minutes contemplate a copy of the deed of release and settlement of 11 November 2011 being annexed to the orders. The other matters segment of the orders also mention that the properties also include the fixtures and fittings on the properties as at 29 October 2010, the date that Eltham Baptist Church went into possession as licensee.

1. Upon the payment by Properties Corporation of the Churches of Christ of:

a. the debts of the Nillumbik Community Church Inc (in Liquidation);

b. the costs of the administration of the Nillumbik Community Church Inc (in Liquidation); and

c. the costs of the liquidation the Nillumbik Community Church Inc (in Liquidation);

the surplus assets of the Nillumbik Community Church Inc (in Liquidation) be transferred to the Properties Corporation of the Churches of Christ.

2. The plaintiff's costs be costs in the liquidation of the Nillumbik Community Church Incorporated (in Liquidation).

46 For completeness, I set out the observations in the "Other Matters" segment of the orders:

The order made in paragraph 1 of these orders is made pursuant to a referral by The Honourable Justice Ferguson on 8 September 2011 in accordance with r.77.05 of the Supreme Court (General Civil Procedure) Rules 2005.

The order made in paragraph 1 is made upon the basis that the Properties Corporation of the Churches of Christ, the Baptist Union of Victoria and the Eltham Baptist Church have entered into a Deed of Release and Settlement dated 11 November 2011, a copy of which is annexed to these Orders.

The surplus assets of the Nillumbik Community Church Inc (in Liquidation) comprise:

four parcels of land: Certificate of Title Volume 10640 Folio 894, Volume 10913 Folio 617, Volume 10913 Folio 616 and Volume 10913 Folio 615 together with fittings, fixtures and chattels up to 29 October 2010 being the date the Eltham Baptist Church entered into possession as licensee; and

b) the costs order in favour of the Nillumbik Community Church Inc (in Liquidation) made by the Honourable Justice Davies on 16 April 2010 in proceeding SCI 2009 10613 against Grant Desmond Taylor."

Appendix I to the constitution of the Eltham Baptist Church:

The Doctrinal Basis from the Constitution of the Baptist Union of Victoria

The divine inspiration and supreme authority of the Scriptures of the Old and New Testaments.
The existence of one God in three persons - the Father, the Son, and the Holy Spirit.
The deity and incarnation of the Lord Jesus Christ, who is the Son of God, the second person of the Holy Trinity.
The fallen, sinful and lost estate of all people.
The salvation of men and women from the penal consequences and power of sin through the perfect obedience of the Lord Jesus Christ, His atoning death, His resurrection from the dead, His ascension to the right hand of the Father, and His unchanging priesthood.
The immediate work of the Holy Spirit in the regeneration of men and women, in their sanctification, and in their preservation to the heavenly Kingdom of the Lord Jesus Christ.
The necessity, in order to know salvation, of repentance towards God and of faith in the Lord Jesus Christ.
The resurrection of the dead, and the final judgment of all people by the Lord Jesus Christ.
The two ordinances of the Lord Jesus Christ, namely Baptism and the Lord's Supper, which are of perpetual obligation: Baptism being the immersion of believers upon the profession of their faith in the Lord Jesus Christ, and a symbol of the fellowship of thee regenerate in His Death, burial and resurrection; the Lord's Supper being a memorial, until He comes, of the sacrifice of the body and blood of the Lord Jesus Christ.

The Principles and Ideals of the Baptist Faith from the Constitution of the Baptist Union of Victoria

Whilst holding many phases of Christian Truth in common with other denominations, Baptists place a distinctive emphasis upon the following fundamental principles of the Christian Faith, as revealed in the New Testament.

1. The Child in the Kingdom

(a) Baptists believe that infants are God's little ones, whether children of Christian or nonChristian parents, and accept without modification the word of the Lord, "Of such is the Kingdom of Heaven". This Christian view of the child makes the external act of "Infant Baptism" unnecessary.

(b) Baptists approve of the presentation of children to God by parents, if thereby they solemnly undertake to train them in the nurture and admonition of the Lord, in the home and in the Church.

(a) To all who at the stage of personal responsibility, ignore God's law, and wander as prodigals from the Father's Home, Baptists preach the gospel of the Father's love, and the message of the cross, as the Way of Life. Conversion is acceptance of Jesus Christ as Saviour and Lord.

(b) This acceptance of Christ is a personal and deliberate act, involving the assent of the mind, the decision of the will, and the love of the heart.

(c) This avowal of allegiance to Christ implies a constant endeavour to live a life worthy of, and well-pleasing to Him in all things.

Baptists hold that the Church, as established by the Lord Jesus Christ should consist of persons who have personally and intelligently accepted Him as Saviour and Lord, and pledged themselves to discipleship and service in the Kingdom of God.

(a) Baptists hold and teach that Jesus Christ alone is the Head of the Church, and that without any human intervention or ritualistic ceremony.

(b) Therefore, He is the sole authority in all matters of faith and conduct, in the life both of the Church and of the individual.

(c) This involves liberty of thought and conscience, and the rights of the Believer and the Church, freed from any ecclesiastical or other external authority, to interpret His Mind.

(a) Believing that the voice of the Church is subordinate to the voice of Christ, and that the mind of the Master is the Standard of Christian belief, Baptists do not subscribe to any formal Church Creed lest it hamper the development of Christian thought.

(b) Further, in their interpretation of the Lord's farewell declaration, "When He, the Spirit of Truth, is come, He will guide you into all truth", Baptists accept the principle that God has yet "more light and truth to break forth from His Word".

(c) Therefore, Baptists claim the personal privilege, and accept the Christian responsibility of courageously thinking God's thoughts after Him, under the guidance and inspiration of the Spirit of Truth.

(a) In adopting the Congregational Principles of Church government, with no formal creed, with no external authority, and no defined ecclesiastical policy, and each member having equal rights and responsibilities, the Baptist Church is largely dependent on the reality and vigour of the spiritual life of its individual members.

(b) This spiritual life is generated by the understanding and Inspiration of Christ's ideals, and by the creation and maintenance of a spiritual atmosphere, in which all that is unworthy dies, and in which Christian life becomes healthy and aggressive.

(c) Baptist ministers accept their office from the Lord of the Church, and while they are "servants of the Church" the Church is not master over them. They are the spiritual leaders in the life and ministry of the church.

(d) Associated with the ministers in the spiritual oversight of the Church are men and women chosen for their Christian gifts and graces, who are called to be examples to the members of the Church, in conduct, zeal, selfdenial and generosity.

(e) Church officers are appointed as spiritual leaders to work in sympathetic cooperation with the minister and Church members.

(f) The periodic Church Business Meeting is the centre of the Church's Christian activities, and is the seat of authority in the management of Church business.

(a) Christian Baptism, by which is meant the immersion of believers as instituted by our Lord, is a personal, public confession of the believer's identification with Christ, and also a means of grace to the Christian.

(b) Baptism is an outward act which symbolises, but does not effect regeneration, and salvation is not dependent on it.

(c) Baptism is a glorious privilege and a personal responsibility, and is a help to all believers in reminding them of their spiritual union with Christ in his death, burial and resurrection.

(a) To Baptists the Church is not so much an organisation as a fellowship, effective only as there is spiritual association with the Head of the Church.

(b) The Lord's Supper is a service of spiritual fellowship whereby, through remembrance of His Life and Death believers may experience in supreme degree the reality and influence of His Presence.

(c) It is an opportunity of entering into close fellowship with the Lord in the Holy of Holies, where there is a rekindling of love and a reconsecration of life to His service.

Baptists recognise their responsibility to strive for the establishment of the Kingdom of God in the world and teach that membership in the Church implies service and sacrifice. This involves a stewardship of time, talents and money which aims at being worthy of the Son of God who loved and served humankind, even unto death.

Provided lastly that until a Church has been duly formed such as those from time to time belonging to the Baptist Union of Victoria or in case the Church so formed or the Church already existing shall at any time hereafter be dissolved or disbursed or the members thereof be reduced to five in number or if the state of Public Worship of God in the trust premises shall be discontinued for six calendar months continuously (except in the case of altering or rebuilding) then and in any of such cases the Union shall stand seised and possessed of the trust premises or the proceeds to arise from all or any part of the same in trust for such purpose or purposes and to deal with and dispose of the trust premises and proceeds as and in such manner as the Executive Council of the Union if then in existence shall direct by resolution passed by a majority of two-thirds of the members of the said council present and voting in a Special Meeting called for the purpose thereof and certified under the hand of the President for the time being of the Union or if such union be not in existence then as the Pastors of the five Baptist Churches connected with the Union at the date of it ceasing to exist then in existence nearest to the trust premises shall in their discretion direct or appoint by writing under their hands.

[1] Re Nillumbik Community Church Incorporated (in administration) [2010] VSC 136.

[2] On 8 September 2011, Ferguson J ordered that the originating process be referred to an associate judge for hearing and determination pursuant to r 77.05 of the Supreme Court (General Civil Procedure) Rules 2005 and, if required, also pursuant to r 16.1(3) of the Supreme Court (Corporations) Rules 2003.

[3] It appears that the reference in cl 30 to 34 is a typographical error as that rule pertains to quite unrelated matters and should refer to cl 30 itself, which is the rule dealing with the distribution of any surplus on a winding up or dissolution.

[4] The colon appears in the original text.

[5] The provisions of clause 15 of Schedule B are set out in Schedule 2 to these reasons.

[6] "Church" is defined as a member church, such as the Eltham Baptist Church would be in these circumstances.

Incorporation Act 1981

(Ancillary Provisions) Act 2001

Churches of Christ in Victoria Property Act 1941

While the Churches of Christ in Victoria Property Act 1941

Baptist Union Incorporation Act 1930

Baptist Union Corporations Act 1930

Court (General Civil Procedure) Rules 2005

Court (Corporations) Rules 2003

Incorporation Act 1981

(Ancillary Provisions) Act 2001

Churches of Christ in Victoria Property Act 1941

While the Churches of Christ in Victoria Property Act 1941

Baptist Union Incorporation Act 1930

Baptist Union Corporations Act 1930

Court (General Civil Procedure) Rules 2005

Court (Corporations) Rules 2003

At a glance

Court

Decision date

Before

Source

Judgment (87 paragraphs)

Legislation Cited (16)