Richard Ehiozee v EDO Nigerian Association of New South Wales Incorporated & Ors

Judgment 1By his further amended statement of claim filed 26 March 2012 the plaintiff claims declarations that certain action taken by the defendants against him as a member of the EDO Nigerian Association of New South Wales Incorporated, the first defendant (the association), was invalid. He also claims damages for defamation arising from the publication by the defendants of a number of email communications. The defamation claim is to be tried at some future time. This judgment is concerned only with the claims for declaratory relief. 2The plaintiff is a member of the association, a body originally incorporated under the Associations Incorporation Act 1984 (repealed), and now under the Associations Incorporation Act 2009 (the Act). The association is an ethnic cultural group defined by the language and social activities of the EDO culture. At all relevant times the second to seventh defendants inclusive, were office-bearers of the association, and members of its executive committee. 3The association is governed by its constitution dated October 2000, and registered on 27 August 2002. 4These proceedings were commenced by summons filed on 21 February 2011, after a decision by the members of the executive committee that the plaintiff be removed from the position of patron. Relevant background was described in Ehiozee v EDO Nigerian Association of New South Wales Incorporated [2012] NSWSC 239 by Schmidt J as follows: "2 ... That decision was made in the aftermath of a dispute between Mr Ehiozee and the second defendant, Mr Vincent Evbuomwan, the then president of the Association, over the Association's acceptance of Mr Ehiozee's gift of three goats, which were intended to be eaten by members of the Association, at its end of year festivities in 2010. 3 While the goats were eventually received and eaten, the dispute led not only to Mr Ehiozee's removal from the position he understood that he held, but also to the publication of certain information about the dispute. In the result Mr Ehiozee refused to attend a 'peace meeting'; or a disciplinary committee meeting. A special general meeting of the Association was called to deal with the dispute, which Mr Ehiozee addressed, but which concluded without any resolutions about the dispute being put, because of the announcement of the executive committee's decision to 'deconfer' Mr Ehiozee as patron. This escalated the disagreement. A 'peace committee' was established to try to resolve the matter. That failed and these proceedings were commenced ..." 5The position of patron was provided for in proposed amendments to the constitution which were approved at a general meeting of the association on 1 December 2002. The relevant proposed amendment was as follows: "Office of the patron Nomination of Patron shall be through Executive Committee recommendation to the memberships at general meeting for ratification. And the role of the patron shall be ceremonial, non-factional, and independent. He/She shall not be directly involved in the day-to-day running and operations of the Association. The ENA Patron shall be consulted whenever necessary for advise [sic] and guidance." 6The proposed amendments were never registered as required by the Act. It is common ground that the proposed amendments and the plaintiff's appointment to the position of patron were never effective. 7The present proceedings are concerned with the plaintiff's claims that the association and the individual members of the executive committee failed to deal with the dispute over the goats in accordance with the provisions of the constitution which governed the resolution of disputes between members of the association. During the hearing, the plaintiff abandoned his claim for consequential damages. 8The dispute arose following the refusal by the president of the association to accept the plaintiff's offer made at the meeting of the association on 12 December 2010 to donate three goats for end of year festivities. The president asked for a cash equivalent instead. 9On 23 December 2010 a meeting of the executive committee was arranged to take place on 26 December 2010. The plaintiff did not attend this meeting. 10On 24 December 2010 the plaintiff sent a letter entitled "Goodwill Message to ENA Members December 24 2010" to members of the association. Under the heading "Donation Issues" it included: "I was with other members at Mr and Mrs Omokaro's house Friday night December 17, 2010 to support preparation for 10th Anniversary, the goats matter was raised by members who were present that night ... They discussed the issue, in the end I supported the view that we should all focused on the 10th Anniversary occasion for peace and unity. It was proposed that a conciliation meeting on th [sic] goat issue be held at Smart Okunbor's house on Sunday 26, 2010. I want to personally thank members for their concerns in this matter, my wife in particular for her maturity. On December 18, we all were at Blactown [sic] Bowman hall and indeed we celebrated our memorable 10th Anniversary occasion in peace and harmony. We also eat the goat meat I donated that day. In my mind the goat issue is completely finished, dead and buried. I have forgiven those who have offended me and my family. Myself and my wife have resolved to put the matter behind us. As Patron, I will continue play to my fatherly role to enhance ENA progress and properity [sic]" 11By email of 29 December 2010, the plaintiff was invited to attend a meeting of the association's disciplinary committee to be held within the next fourteen days. It included: "After careful deliberation during our last Executive Meeting, we (Executive Committee) hereby invite you to afford us an opportunity to hear your side of the controversy surrounding your recent email "Patrons Message 2010" to the ENA Community. This did not only bring the whole Association of which you are an Officer into disrepute, but a breach of Section 15. RESOLUTION OF INTERNAL DISPUTES of ENA Constitution which recommends such issues be referred to Executive Committee for mediation." 12On about 15 January 2011 the executive committee held a meeting at which it passed a vote of no confidence against the plaintiff and resolved to "de-confer" [sic] him as the patron of the association. Its email of 15 January 2011 to the plaintiff stated: "NOTICE TO WITHDRAW YOUR PATRONSHIP TO ENA The Executive Committee of ENA after a careful and exhaustive deliberation during our recent Executive Meeting and in accordance to ENA constitution, section 18, subsection a to c - POWERS OF THE COMMITTEE commissioning the executive to effectively manage the affairs of our great association. The Executive Committee has unanimously passed a vote of no confidence against you (Mr R Ehiozee) and hereby DE-CONFERS you as the patron of the Association. The reasons for this action include: i Disregarding the executive invitation to explain your story regards 'Patron Message 2010' and publicizing the issue to the general community before the executive could mediate over it. ii Unacceptable and continued intimidation to members of our association. iii Insult, intimidation, threatening, and bully of our great ENA president in the discharge of his official functions. You have a 7 days right (see section 17 - RIGHT OF APPEAL OF DISCIPLINED MEMBER of ENA constitution) of appeal against this decision. Long Live ENA, Long Live us all" 13On 17 January 2011 the executive committee called a special general meeting of members of the association to be held on 30 January 2011 to inform them of the decision to remove the plaintiff from his role as patron. 14On 30 January 2011 a meeting of the association was held. It ended without any resolution being proposed or passed by the members present after being informed by the secretary that the decision of the executive committee was final. 15Under the constitution, "ordinary member" is defined to mean a member of the association who is not an office-bearer; "office-bearer" means an elected member to the executive committee. The constitution includes the following provisions: "5 POWERS The association shall, subject to the provisions of NSW Incorporation and Association Act, have power to do all such lawful things as may seem to the executive committee necessary to carry out the objectives of the Association. 6 EXECUTIVE COMMITTEE (1) The Executive Committee of the association shall be a committee of six members namely [the officer-bearers]. ... (7) The executive committee shall manage and control the affairs of the association in accordance with this constitution and with the Act. (8) If any dispute between the association and any of its members arises that cannot be amicably settled by the executive committee, the matter shall be referred to the general meeting of the association for decision. ... 15 RESOLUTION OF INTERNAL DISPUTES Disputes between members (in their capacity as members) of the association, and disputes between members and the association, are to be referred to the Executive Committee for mediation. 16 DISCIPLINING OF MEMBERS (1) A complaint may be made by any member of the association that some other member of the association: (a) has persistently refused or neglect to comply with a provision or provisions of these rules; or (b) has persistently and willfully [sic] acted in a manner prejudicial to the interests of the association. (2) On receiving such a complaint, the association recommends to [sic]: (a) must give the member at least 14 days from the time the notice is served within which to make submissions to the association in connection with the complaint; and (b) must take into consideration any submissions made by the member in connection with the complaint. (3) The association may, by resolution expel the member from the association or suspend the member from membership of the association if, after considering the complaint and any submissions made in connection with the complaint, it is satisfied that the facts alleged in the complaint have been proved. ... 17 RIGHT OF APPEAL OF DISCIPLINED MEMBER (1) A member may appeal to the association in general meeting against a resolution of the executive committee under rule 11, within 7 days after notice of the resolution is served on the member, by lodging with the secretary a notice to that effect. ... (4) At a general meeting of the association under clause (3): (a) no business other than the question of the appeal is to be transacted; and (b) the executive committee and the member must be given the opportunity to state their respective cases orally or in writing, or both; and (c) the members present are to vote by secret ballot on the question of whether the resolution should be confirmed or revoked. ... 18 POWERS OF THE COMMITTEE The committee is the executive committee of management of the association and, subject to the Act the Regulation and these rules and to any resolution passed by the association in general meeting. (a) is to control and manage the affairs of the association; and (b) may exercise all such functions as may be exercised by a general meeting of members of the association; and (c) has power to perform all such acts and do all such things as appear to the executive committee to be necessary or desirable for the proper management of the affairs of the association. ... 27 VOTING AND DECISIONS (1) Questions arising at a meeting of the executive committee or of any sub-committee appointed by the executive committee are to be determined by a majority of the votes of members of the executive committee or sub-committee present at the meeting. ... (3) Any act or thing done or suffered, or purported to have been done or suffered, by the committee or by a sub-committee appointed by the executive committee, is valid and effectual despite any defect that may afterwards be discovered in the appointment or qualification of any member of the executive committee or sub-committee." 16Under the Act, s 26 provides: "26 Nature of association (1) Subject to this Act, an association's constitution binds the association and its members to the same extent as if it were a contract between them under which they each agree to observe its provisions." 17I turn to the first prayer for relief, namely a declaration to the effect that the invitation of 29 December 2010 to the association's disciplinary committee is invalid. It was opposed on the grounds that, in the circumstances, a declaration to that effect was futile and would serve no purpose, and should be refused. 18The plaintiff submitted that the invitation was an erroneous exercise of power under cl 16(2) of the constitution. 19It is well established that a power to expel from an incorporated club is one where the procedures laid down by its constituent documents must be strictly complied with, if the expulsion is to be valid (Hornby v Narrandera Ex-Serviceman's Club Ltd [2001] NSWSC 235, pars 8, 9, 10; McClelland v Burning Palms Surf Life Saving Club [2002] NSWSC 470; (2002) 191 ALR 759, par 74; Rana v Survery [2012] NSWSC 439, pars 10, 11). 20The relevant rule, cl 16, is concerned with the disciplinary procedure to be followed where a complaint has been made by a member that some other member has either persistently refused or neglected to comply with the rules, or has persistently and wilfully acted in a manner prejudicial to the interests of the association. Clause 16(2) is a mandatory requirement that the accused member is afforded at least 14 days from the time the notice is served within which to make submissions to the association in connection with the complaint. Implicit is the requirement that adequate particulars of the complaint of conduct within cl 16(1)(a) or (b) be given to enable the member to make submissions in response to them. 21Analysis of the document shows that, on its face, no particulars were given of a complaint which alleged conduct of the kind to which either cl 16(1)(a) or (b) referred, and no period of at least 14 days was given within which submissions were to be made. In my opinion the invitation was defective and invalid as a notice under cl 16(2). In any event, the plaintiff disregarded it. No meeting took place at which a resolution adverse to the plaintiff was either put, or passed. 22Principles applicable to the discretionary refusal of declaratory relief were explained by Brereton J in Commonwealth of Australia v BIS Cleanaway Ltd [2007] NSWSC 1075; (2007) 214 FLR 271 in which he referred to established categories of cases in which the court will generally decline, as a matter of discretion, to exercise its power to make a declaration. He said: "28 Another, related, category is where no good purpose would be served by granting declaratory relief [Buck v Attorney-General [1965] Ch 745; Blackburn v Attorney-General [1971] 2 All ER 1380; Gardner v Dairy Industry Authority (declaration if otherwise appropriate would have been declined where it had no foreseeable consequences, not leading to damages or other consequential relief but at best somehow prompting possible administrative or legislative action that that might improve the position of the appellants and others in their position); Rivers v Bondi Junction-Waverley RSL Sub-Branch Ltd [1986] 5 NSWLR 362 (declaration that election of directors involved irregularities refused where they did not affect the result)]. In this respect, it is generally inappropriate to grant declaratory relief if it will be inconclusive, in the sense that the proposed declaration would leave unresolved issues, with the parties still in dispute as to the consequences so that further litigation would be required to resolve the controversy [Smart v Allen (1970) 91 WN(NSW) 241; Integrated Lighting & Ceilings Pty Ltd v Phillips Electrical Pty Ltd (1969) 90 WN (Pt 1) (NSW) 693, 702]." 23In my opinion, this claim for a declaration falls into the category of those where no good purpose would be served by the grant of such relief. The communication of 29 December 2010 was merely an invitation to attend a meeting at which, as it happened, nothing adverse to the plaintiff's interests as a member took place. In the circumstances no remedy is called for. Accordingly, the claim for the declaration is refused. 24I next turn to the claim for declaratory relief in respect of the resolution of the executive committee which was communicated to the plaintiff by the email of 15 January 2011. The email recorded a unanimous resolution of a vote of no-confidence against the plaintiff, and to "de-confer" him as the patron of the association. The case proceeded on the basis that the intention behind the second limb of the resolution was to terminate the purported appointment of the plaintiff to the office of patron as envisaged by the proposed amendments to the constitution based on the vote of no confidence against him. 25Although prayers 2, 3, and 4 of the further amended statement of claim are formulated as separate claims for relief, in my opinion it was the passing of the resolution which is the real, and only, matter for which declaratory relief is available. The email was merely the means by which the resolution was communicated. 26The defendants accepted (T pp 53, 54) that the decision recorded in the email was a nullity. It was common ground that as there was no effective provision in the constitution for the office of patron it followed that a resolution which purported to strip the plaintiff of a non-existent office was without effect. 27The plaintiff submitted that an additional ground of invalidity was that the passing of the resolution was in breach of the rules of natural justice in that the purported exercise of power was without notice to the plaintiff and, in any event, ultra vires the powers provided under rr 18(a), (b) and (c) of the constitution. It followed, so it was put, that because the association was incorporated with rules which bound the members and the association as a contract, there was a breach of contract in respect of which the plaintiff was entitled to relief. It was put that although the executive committee purported to act under rr 18(a), (b), and (c), it was, nevertheless, incumbent upon it, in the circumstances, to follow a procedure similar to that required under r 16(2) which it failed to do. 28In opposition, the defendants contended that, in the exercise of discretion, declaratory relief should be refused on the ground that, in the circumstances, it would serve no purpose. In the alternative, it was submitted that the plaintiff was not entitled to relief as against the second to seventh defendants as they acted as members of the executive committee. 29Under s 75 Supreme Court Act 1970 the court is empowered to make a declaration of right whether or not any consequential relief is claimed. In this case, no consequential relief is claimed. 30In my opinion, the acceptance that the resolution was a nullity is sufficient, without more, to justify the making of a declaration. The present claim in respect of the resolution does not raise a merely hypothetical question. The background to the passing of the resolution was the dispute earlier referred to, which involved the plaintiff and members of the association including the members of the executive committee. It is apparent that the dispute had a divisive effect among members. It is self-evident that the resolution would have been detrimental to the plaintiff's reputation among members of the association. Furthermore the executive committee proceeded as if the resolution operated as intended in calling a special general meeting of members of the association for 30 January 2011 to deal with the removal of the plaintiff as patron, and at the meeting informing the members that its decision was final. By bringing this claim the plaintiff has demonstrated his desire and concern to obtain a remedy for the wrong done as a result of the erroneous exercise of power by the association through its executive committee. 31Had the resolution not been inherently defective, the plaintiff's challenge to its validity based on a denial of natural justice should be upheld. 32In my opinion, in the circumstances of this case, justice will be served by the making of a declaration in the following terms: "Declaration that the resolution of the executive committee of the first defendant made on or about 15 January 2011, concerning the plaintiff, is invalid and of no effect." 33In light of this conclusion and the fact that no order is sought against any defendant, it is unnecessary to determine the question raised by the defendants that it was not open to the plaintiff to seek relief against individual members of the executive committee in circumstances where the challenged conduct was the purported exercise of the powers and functions of the executive committee under the rules of the association. It is also unnecessary to decide the related issue of the scope of the contractual obligations between the association and its members under s 26 of the Act.