Steve Parrott Pty Ltd v Fire Protection Association Australia

Relief sought

1. By these proceedings, the company and Mr Parrott challenge the defendant's authority to make those decisions in the manner that it did, seeking declaratory relief or an order setting the decisions aside on the grounds of denial of natural justice and procedural fairness. The original pleading also sought an order that the corporate plaintiff's membership and Mr Parrott's status as an accredited practitioner be reinstated but that relief was not pursued at the hearing. [2] The plaintiffs also seek damages, including damages under s 236 of the Australian Consumer Law.
2. The defendant has not suggested that the dispute is not justiciable, accepting that the relationship between it and each plaintiff is contractual (albeit that the relationship with the company and that with the individual are governed by different terms). The defendant contends, however, that the plaintiffs' claim is fundamentally misconceived in that it ignores the critical significance of the private contractual relationship, assuming rather the existence of a fixed notion of procedural fairness which confuses private bodies with public authorities.
3. As already noted, the defendant is a private body (a company limited by guarantee). The scheme it administers, known as the Bushfire Planning and Design or BPAD scheme, is not a statutory accreditation scheme. In administering the scheme, the defendant does not exercise any public power or perform any executive or administrative function. [3] The scheme enjoys statutory recognition only in the sense that, as already noted, it is recognised by the NSW Rural Fire Service, [4] with the result that persons accredited under the scheme are recognised as qualified consultants for the purpose of planning legislation relating to bushfire prone land.
4. It follows that the relationship between the defendant and its members and accredited practitioners is governed by private law. While it is well recognised that the court has power to grant declaratory relief in respect of wrongful expulsion in such circumstances, the content of any obligation to afford procedural fairness is not co-extensive with the obligation to afford procedural fairness that exists in public law but, rather, is critically informed by the relevant contractual provisions.
5. The original statement of claim filed 24 September 2013 also pleaded a claim in negligence [5] but that was abandoned at the hearing. [6] However, the plaintiffs later obtained leave to file an amended statement of claim expanding the claim in contract in response to information provided by the defendant during opening addresses [7] and adding the claim for damages under the Australian Consumer Law. [8]

Circumstances in which the claims are brought

1. Mr Parrott has conducted business in the profession of bushfire risk assessment since around early 2003, trading as "Bushfire Safety Solutions". [9] Before starting that business, Mr Parrott had been a volunteer with the NSW Rural Fire Service for over 40 years and a field officer for more than 20 years. He has lengthy experience and qualifications in both fire-fighting and as a building surveyor.
2. The BPAD scheme administered by the defendant was introduced in New South Wales in 2006 in response to "the lack of entry requirements for bushfire consultants". [10] The purpose of the scheme is to accredit bushfire consultants as persons capable of providing advice and reports regarding bushfire resilience. The kind of services provided by bushfire consultants include assessing bushfire hazard and risk; undertaking bushfire attack assessments and determining bushfire attack levels (referred to in the industry as BALs [11] ); preparing reports for the development of land in bushfire prone areas in response to regulatory requirements and providing advice regarding appropriate mitigation measures to reduce the risk from bushfire impact for existing and new buildings. [12]
3. The plaintiff company, Steve Parrott Pty Ltd, became a corporate member of the defendant in June 2008. Mr Parrott is the sole director of that company. He became an accredited practitioner under the scheme administered by the defendant in July 2010.
4. On 29 March 2012, Mr Wyborn, the senior technical officer for the defendant, received a complaint by email concerning Mr Parrott. [13] The complaint came from Ms Catherine Gorrie, who was also a BPAD accredited consultant and so a competitor of Mr Parrott. Ms Gorrie's email informed Mr Wyborn that, in addition to holding BPAD accreditation, she was also a development assessment officer at Blue Mountains City Council and, in that role, saw "a lot of bushfire reports coming into council for various projects". She asserted that Mr Parrott had submitted several reports to the council which were "completely unacceptable". The email said: On a number of recent occasions he has reduced Flame Zone developments to BAL 19 and 29 and his justification lies in adjacent properties carrying out clearing.
5. Ms Gorrie provided a quote from one of Mr Parrott's reports to substantiate that concern, asserting that the approach indicated in the quote was not in line with "Planning for Bushfire Protection" [14] and "is also a ridiculous suggestion in each of the cases of this type I've seen". The email continued: [Mr Parrott] is a joke in our office and I feel he is bringing down the bushfire consultant profession. I'm not sure how to handle this as it seems like a conflict of interest for me as he would be seen as my competitor consultant in my area. However I don't feel this is the case because I have a written undertaking with my general manager that I won't carry out any bushfire work privately in the Blue Mountains Council area.
6. It should go without saying that the suggestion that an accredited practitioner was producing reports that understated bushfire attack levels (which seek to quantify the risk of bushfire in bushfire prone land) warranted investigation of some kind. That is not, of course, to make any assumption as to whether Ms Gorrie's complaint was well-founded but only to observe that the proper administration of the accreditation scheme plainly demanded its investigation.
7. Upon receiving Ms Gorrie's email, Mr Wyborn wrote to Mr Lew Short, the group manager of "Community Resilience" at the NSW Rural Fire Service. Mr Short was at that time the NSW Rural Fire Service representative responsible for liaising with the defendant (as its representative on the BPAD peer review panel). [15]
8. Mr Wyborn's email to Mr Short asked for his "thoughts" on the work undertaken by Mr Parrott. Mr Wyborn wrote: Yesterday I received a complaint about two reports that he had produced that were purported to understate the risk significantly by relying on vegetation management on neighbouring property not used for residential purposes. I will be undertaking an investigation, but thought I'd take the opportunity to seek your views before I start.
9. In cross-examination at the hearing, Mr Wyborn said he thought the reference to "two reports" was an error on his part, probably based on a misreading of Ms Gorrie's original email. [16]
10. Mr Short responded by forwarding material he had received from Mr Shepparton, a manager with the NSW Rural Fire Service, providing five examples of jobs undertaken by Mr Parrott in which errors or concerns had been raised. The information was drawn from a "Consultant Issue Register" maintained by the NSW Rural Fire Service. In his email to Mr Short, Mr Shackleton wrote: As discussed the other day, Steve Parrott has causing (sic) concerns within the CSC ranks for some time now. There have been a number of occasions where Steve's reports have either been erroneous or appeared misleading, however as you are aware, unfortunately until recently, information has not been gathered on these examples. What I do have now (attached) is a few examples of jobs that Steve has done recently in which errors or concerns were raised.
11. The acronym "CSC" is a reference to the Customer Service Centre of the NSW Rural Fire Service.
12. Mr Short's email attached the material from the Consultant Issue Register. Mr Wyborn considered that material and formed the view that the NSW Rural Fire Service had concerns as to Mr Parrott's conduct.
13. Mr Wyborn sought copies of the reports that had been submitted by Mr Parrott in respect of those five properties. The NSW Rural Fire Service sent him such details and documents as were held by it. Mr Wyborn reviewed that material. He formed the view that there were grounds to suspect that Mr Parrott had failed to meet the standards of the BPAD scheme in preparing the five reports. However, he determined that he could not reach a concluded view on that issue without reviewing Mr Parrott's working papers and notes for each site. A file note recording his analysis and conclusions was in evidence in the proceedings. [17]
14. On 3 January 2013 (after consulting with Mr Williams, the CEO of the defendant), Mr Wyborn wrote to Mr Parrott. The letter informed Mr Parrott that a formal complaint had been received in respect of his activities as a certified practitioner. It identified the complaint as "a claim…that several reports prepared and submitted by you incorrectly assess the bushfire risk and propose recommendations that do not adequately address the actual risk"; informed Mr Parrott that the defendant's preliminary investigation had included a request to the Rural Fire Service for information; noted that after reviewing that information the defendant considered that further investigation was warranted and concluded with the request for specified documents.
15. It should be noted that the documents sought were the historical records in respect of the five sites identified by the NSW Rural Fire Service (all versions of any bushfire report, site assessment notes, correspondence, computations and so on). The request did not ask Mr Parrott to prepare any form of evaluative response to the complaint or to defend his position in any way. It merely sought production of such documents as might already exist and be in his possession relating to the concerns raised. The letter sought production of the documents by 8 February 2013.
16. On about 15 January 2015 Mr Parrott called Mr Wyborn in relation to that letter. Mr Parrott gave the following account of that conversation in his affidavit: Parrott: Who has made the complaint against me? Wyborn: It is an anonymous complaint, and we are not prepared to allow you to view any evidence or provide you with the name of the person who has made the complaint submitted to us. Parrott: The time frame for me to respond is too short. I need an extension of time to respond so that I can gather up my files and other information. I will also have my solicitor review the material I intend to submit before submission, including the veracity of the complaint and complainant, and the legitimacy of the procedural fairness of the investigation. I will need an extension to the end of February 2013. I also require the evidence that supports the complaint made against me to be provided to me so that I can adequately defend myself and my reputation. Wyborn: We are prepared to allow you more time.
17. Mr Wyborn does not accept that he said the first words attributed to him in that exchange. He says he explained that the defendant was following a defined process in accordance with the BPAD scheme and the Code of Practice (those documents are considered below). In cross-examination of Mr Parrott, it was also put to him that he did not say anything in that conversation about consulting a solicitor. Rather, the defendant's case is that, in that initial conversation, Mr Parrott openly accepted that he would provide the documents requested, but simply sought further time in which to do so.
18. Mr Wyborn's note of the conversation [18] records that Mr Parrott sought an extension of time for compilation of the material, which was "in storage off-site", and that Mr Wyborn had indicated he was happy to give an extension as the date had been arbitrary and intended only to establish a deadline. Mr Wyborn's note also records that Mr Parrott expressed a concern that the NSW Rural Fire Service was seeking to "make a scapegoat of him" and that Mr Wyborn informed Mr Parrott that it was not the Rural Fire Service that had lodged the complaint.
19. Mr Wyborn's note concluded: I advised Steve that [the defendant] was following a defined process in accordance with the BPAD scheme and the COP and would ensure procedural fairness was applied. I advised that at this stage we were just seeking his primary documents and that he didn't have to defend his position as a breach had not been determined at this stage.
20. After that conversation, Mr Parrott wrote to Mr Wyborn confirming his request for an extension of time to gather his files. [19] Mr Parrott wrote, further: Prior to any submission, my solicitor will be reviewing my intended responses, the veracity of the complaint (and complainant) and the legitimacy of the procedural fairness being proposed to investigate this alleged breach".
21. Mr Parrott also requested that the complainant's evidence be provided to him so that he could adequately defend himself.
22. Mr Wyborn replied by email dated 17 January 2013 agreeing to extend the deadline to 15 February 2013. [20] In that email, he set out the process that the defendant proposed to adopt in investigating the complaint. In particular, he confirmed that the request for information was "to support further investigation of the complaint in order to determine if there is any evidence or not". The email confirmed that, following receipt of the requested information and further investigation, the CEO would make a decision as to whether a breach of regulations, standards or codes had or had not occurred. The email said: If no breach is discovered, no further action will be undertaken and the complainant advised accordingly. If a breach is discovered, this will be put to you and you will be afforded the opportunity to respond and defend your position in an open, transparent and fair process.
23. The email concluded by outlining the sanctions that could follow if a breach was determined, reiterating: You will be further afforded the opportunity to respond and appeal any decision in an open, transparent and fair process in accordance with the conditions of the scheme.
24. On 11 February 2013, the defendant received a letter from Mr Parrott's solicitors, Yates Beaggi Lawyers. [21] In summary, the letter asserted an entitlement to procedural fairness during the investigation and requested copies of the complaint and the complainant's correspondence with the NSW Rural Fire Service; an explanation as to why the defendant believed the complaint and the information received from the NSW Rural Fire Service warranted investigation; the facts and matters relied upon "to ground a basis for investigation" and, "if indeed" the defendant believed there was a basis to suggest investigation was warranted, particulars of the defendant's "findings and reasons" by reference to the five sites. The letter concluded by stating "only upon receipt of the abovementioned particulars/documents will our client be in a position to properly address your request, and respond".
25. In my assessment, the letter misconceived the import of the earlier correspondence. As recorded above, Mr Wyborn's letter made plain that he was seeking documents for the purpose of the investigation, which would determine whether a case for breach would be put to Mr Parrott at all. Further, since the request was for nothing more than documents that already existed, it is difficult to understand the solicitor's assertion that particulars were needed in order to address the request properly. The documents either existed or did not. As explained below, it is clear that the defendant had a contractual entitlement to request such material.
26. On 26 February 2013, the CEO of the defendant, Mr Scott Williams, wrote to Mr Parrott. [22] Mr Williams drew Mr Parrott's attention to the fact that he had executed agreements that he would abide by the defendant's Code of Practice and the General Conditions of the BPAD scheme. Mr Williams refused the request for a copy of the complaint and reiterated the request for information made by the letter dated 3 January 2013, extending the deadline (again) until 8 March 2013. The letter concluded: The Association views this matter very seriously and reserves all its rights accordingly.
27. Mr Amirbeaggi of Yates Beaggi replied by email dated 5 March 2013, accusing the defendant (somewhat bizarrely) of pursuing "a course of self-interest". The email reasserted Mr Parrott's entitlement to particulars, the request for which was said to have been prepared "by reference to the controls you refer to in your letter, and matters of law". [23] The letter concluded with a threat to approach this Court "for Administrative Relief including without limitation Injunctive Orders and costs".
28. Mr Williams replied by letter dated 8 March 2013. [24] That letter is important. Apart from expressing disagreement with Mr Amirbeaggi's uncharitable characterisation of the defendant's conduct, the letter explained, to help provide "some further clarity" for Mr Amirbeaggi, that the defendant was unable to determine if there was a case against Mr Parrott without canvassing the further information requested in the letter of 3 January.
29. Mr Williams rejected the assertion that Mr Parrott had no understanding of the nature of the complaint but provided further comments, as follows: Our preliminary investigation given the information we have available to us seems to support the complainant's allegations that the development applications lodged to the appropriate authorities by your client are inconsistent with the objectives and performance requirements as specified in Planning for Bushfire Protection and therefore do not satisfy the requirements of the Environmental Planning and Assessment Act. This incorrect application of PBP extended to matters relating to: Vegetation assessment Determination of applicable level of bushfire risk and Determination of appropriate control measures This applies to the five sites as outlined in my letter dated 3 January 2013 to Mr Steve Parrott.
30. The letter concluded by warning that, if the requested information was not provided, Mr Parrott would be in "automatic breach" of the Code of Practice and the General Conditions of Bushfire Planning and Design Certification Scheme, in which event "we would have no alternative other than to pursue one or more of the options available to us." For a third time, the period within the documents were to be produced was extended, to 14 March 2013. The letter reiterated that provision of the documents within that time would allow the defendant to investigate the matter further "and not automatically place your client in breach". It was stated that no further extension would be granted.
31. Mr Amirbeaggi responded saying that he had prepared an application to file in this Court and inviting discussion to "tease out the issues" so as to prevent the approach to the Court. Mr Williams responded that there was "nothing to tease out other than providing the required information to allow us to conclude our investigation".
32. In hindsight, it is difficult to understand why Mr Parrott was so resistant to producing documents. His evidence suggested that, in fact, there was little to produce. In cross-examination, he gave the following evidence: [25] Q. The request asked you to produce all of the documents in your possession relating to the subject sites. A. Yes. Q. You didn't think there would be any difficulty in doing that, did you? A. In regards to 1(a) through to (d), I'd say 99% of that information was in the reports. It's just the way I run my business, all the computations, all the assessments, any notes formulated into paragraphs, and so forth, in the reports. Q. Do you keep a file for each site you work on? A. I do. I've got a very small manila folder for each job. Q. In that you would include your report, as ultimately produced? A. No, everything is kept electronically. In that folder is an email requesting me to do the job, a site check sheet, and that check sheet information is actually in the report. It is incorporated into the computer modelling if I do that. All the information is in the actual reports. There's generally very little other information. I might do a site snapshot from Google, or something like that, just so I can find the block, but all the mapping is in the reports. Q. Is this right that most of the information is in the report, and to the extent that it isn't in the report, it's in the file? A. Almost all the information is in the file, except for perhaps an email or two in regards to his report, or can you do the job, how much was it quoted, that sort of thing. Q. You've said almost all, but the reality is that between the file and the report you would have everything? A. Yeah, as I said, in the manila folder there'd be generally information in regards to these jobs. Almost all my work is in the report, because that's how I formulate my response. Q. In order to comply with this request, your understanding was that you would need to dig out each of the reports for the sites in question, yes? A. I would have to do that, yes. Q. You would also dig out the files for each of the sites? A. Yes. Q. And by doing that you would cover all of the material that was asked for? A. I would say so, yes.
33. In any event, the final deadline came and went without the production of any documents.

Suspension of membership

1. On 20 March 2013, the defendant wrote to Mr Amirbeaggi. The letter noted that the deadline had passed and continued: In accordance with items 3.16, 5.2, 5.3 and 5.4 of the association's Code of Practice, this matter was referred to the Board of Directors for further determination. Given your client refuses to supply any of the requested information and has been given every opportunity, the Board of Directors has concluded that your client is automatically in breach of the Code of Practice and therefore has made the decision to suspend the membership of your client effective immediately. This suspension will continue until such time as your client appears before a Bushfire Planning and Design Disciplinary Review Panel ("Review Panel") as outlined in the General Conditions of The Bushfire Planning and Design Certification Scheme. At the conclusion of this Review Panel, the matter will again be referred to the Board of Directors for a final determination. As your client has been found to be in breach of the association's Code of Practice and this is a condition of certification as a Bushfire Planning and Design Practitioner under the scheme, your client's status as an Accredited Practitioner will also be suspended immediately pending the outcome of the Review Panel and the final determination of the association's Board of Directors. The association will be removing Mr Steve Parrott T/A Bushfire Safety Solutions from the register of Accredited Practitioners from today's date and would ask that your client does not promote or make reference that he is a Registered or Accredited Practitioner under the scheme. The association will liaise with your client in the following week as to an appropriate date and time for the requirement to appear before the Review Panel.
2. On 3 April 2013, Mr Wyborn telephoned Mr Parrott to discuss arrangements for him to appear before the Disciplinary Review Panel. Mr Parrott gave evidence in his first affidavit that the conversation was in the following terms: Wyborn: When are you available to appear before the Disciplinary Review Panel in connection with your suspension? Parrott: Where would this meeting be? Wyborn: At the RFS in Sydney. Parrott: When will the meeting take place? Wyborn: Some time during the week commencing 22 April 2013. Parrott: I will have to check with my solicitor first to see what his availability is, and I will let you know.
3. Mr Wyborn agrees that there was a conversation in those terms. However, the following day, the defendant's board of directors determined to terminate the company's membership for breach of the Code of Practice. [26]
4. On 18 June 2013, after the termination of the company's membership and Mr Parrott's accreditation, Yates Beaggi wrote to the defendant stating that Mr Parrott had "compiled an array of documents in relation to the five sites" identified in the letter of 3 January 2013. The letter enclosed copies of the reports in relation to each site together with a "file summary" in respect of each site. The letter otherwise recorded the history of correspondence and argued that there had been "a gross miscarriage of justice" in that Mr Parrott had not been afforded procedural fairness. In particular, the letter argued that the plaintiffs' failure to provide the information requested in the letter of 3 January 2013 did not contravene the code; that, if it did, it was "a minor breach only"; that if it was a major breach, Mr Parrott was not advised of the alleged breach and asked to respond in accordance with the General Conditions of the BPAD scheme; that Mr Parrott had subsequently been requested to appear before the panel and that, without any opportunity for him to appear before the panel, the board had proceeded to terminate the membership and accreditation.
5. The letter concluded with a threat that if Mr Parrott's membership was not reinstated within seven days, proceedings would be commenced. Mr Williams replied by letter dated 21 June 2013 stating that the board was satisfied that Mr Parrott had been afforded every opportunity over a considerable period to comply with the requests for documents; that the defendant had been unable to determine compliance due to the refusal to provide the information sought and that the board had determined that the refusal to provide that information constituted an automatic breach of the Code of Practice in response to which the board had exercised its right to cancel the membership.

The contractual framework

1. As already explained, the determination of the plaintiffs' claim rests critically on an analysis of the contractual context in which Ms Gorrie's complaint fell to be considered. The contractual arrangements between the defendant and its members and accredited practitioners are complex, comprising documents with different objectives adopted at different times. There is considerable overlap and cross-reference between the documents; their treatment of the distinction between individuals, companies and businesses is not always consistent and in some instances they address the same topics in different language.
2. The relevant provisions were explained carefully in the defendant's written submissions. The following summary draws heavily from that document.
3. Prior to 1 January 2013, the relevant documents were: 1. The Memorandum and Articles of Association; 2. the Code of Practice (Version FPAA001-2008), which prescribes "the principles, standards of behaviour and service delivery requirements for all [the defendant's] Corporate Members"; 3. the "General Conditions of the Bushfire Planning Design Certification Scheme" (Version 2011:4) (referred to hereafter as the General Conditions); 4. the Corporate Membership Terms and Conditions, to which corporate members agreed to be bound at the time of applying for membership (referred to as the Corporate Membership Conditions); 5. Individual and corporate renewal terms, whereby accredited practitioners and corporate members agreed to be bound by the General Conditions and the Code of Practice (the Renewal Terms).
4. The plaintiffs accept (and indeed rely upon) the application of the Articles of Association, the Code of Practice and the General Conditions. However, they argued that the Corporate Membership Conditions did not form part of the contract.
5. As recorded in the material set out above, the suspension and termination decisions were expressly based on the proposition that the plaintiffs' refusal to produce the information requested in the defendant's letter dated 3 January 2013 was an "automatic breach" of the Code of Practice. Mr Williams' letter of 8 March 2013 also invoked the General Conditions.
6. The central premise of the plaintiffs' claim is that the defendant was obliged to afford procedural fairness in the conduct of the investigation "before finding that [either plaintiff] had breached any provision of the Code or the Scheme" and before making any decision to suspend or terminate the first plaintiff's membership or the second plaintiff's accreditation. [27] The references to the "Code" and the "Scheme" must be understood to refer to the Code of Practice and the General Conditions respectively.
7. The plaintiffs contend that relevant the contractual arrangements were governed by the Articles of Association, which incorporated the Code of Practice, the General Conditions and the Handbook. They contend that those documents required that the plaintiffs be informed of any complaint made against them which was the subject of an investigation. [28]
8. The reference to the Handbook is a reference to a later document, the Bushfire Planning and Design Accreditation Scheme Handbook (NSW), which was introduced by the defendant to replace the General Conditions from 1 January 2013 onwards. The defendant's position at the hearing was that, while it would have been content to embrace the Handbook as part of the relevant contractual matrix, there was in fact never a variation of the contract between the plaintiffs and the defendant by which the parties agreed that the General Conditions would be replaced by the Handbook. In those circumstances, it was submitted that the relevant provisions for purpose of these proceedings are those of the General Conditions, not the Handbook. On my analysis, that is the correct position.
9. In considering the relevant contractual provisions, it is necessary to bear in mind that membership of the defendant was open only to corporations; Mr Parrott was not a member. Accordingly, it is necessary to address the corporate plaintiff's membership and Mr Parrott's position as an accredited practitioner separately.

Contract between the defendant and Steve Parrott Pty Ltd

1. Steve Parrott Pty Ltd first applied for membership of the defendant in June 2008, completing a Corporate Membership Application. The Application included a Membership Declaration in the following terms: On behalf of the company (or companies) listed in the attached schedule, I confirm that we have read and understood the Terms & Conditions printed in this Membership Application Form and agree to abide by them for the term of our membership.
2. Mr Parrott completed and signed that declaration on behalf of Steve Parrott Pty Ltd.
3. The terms and conditions referred to were the Corporate Membership Conditions, which were set out as part of the Corporate Membership Application. They included a condition that the member agreed to be bound by the Code of Practice.
4. Under the heading "Termination and Suspension", the Corporate Membership Conditions relevantly provided: Any member who breaches any provision of the Memorandum and Articles of Association, or as a signatory fails to comply with the Code of Practice, or is guilty of any misconduct or any other action deemed inappropriate by the Board may have their membership immediately suspended or terminated at the sole discretion of the Board.
5. The defendant argues that that provision confers a broad discretion to suspend and terminate members in circumstances not limited to cases of breach of the Code of Practice or misconduct and that the power is sufficiently broad to permit suspension or termination of membership where a member has engaged in any conduct "deemed inappropriate" by the Board "in its sole discretion". It was submitted that there is nothing ambiguous or vague about the power conferred and that, although it is a very wide power, there is no reason to construe it otherwise than in accordance with its plain terms.
6. The issue of suspension and termination is also addressed in the Articles of Association, clauses 8A and 8C. Clause 8A provides: 8A Suspension of Membership The Board may, in its absolute discretion suspend a member's membership of the Association by written notice from the Board on the occurrence of any one of the following events: (i) ... (ii) if such member be guilty of any conduct which may be prejudicial to the interests of the Association or its members; or (iiii) such member be guilty of any other action deemed inappropriate by the Board...
7. As noted by the defendant, that again is a wide power to be exercised in the Board's "absolute discretion".
8. Where suspension has occurred in accordance with clause 8A of the Articles of Association, there is a power to terminate following such suspension in clause 8C of the Articles of Association, as follows: 8C Special Resolution A. If a member's membership of the Association has been suspended pursuant to clause 8A of these Articles, their membership may be terminated subject to a Special Resolution of the Board being passed at a meeting duly called to consider such resolution.
9. However, it emerged at the hearing (being frankly and properly disclosed by senior counsel for the defendant in his opening address) that the board did not in fact meet in order to suspend the membership of the first plaintiff; that action was taken by the CEO. Accordingly, it was common ground at the hearing that the defendant did not in fact invoke the process allowed under the Articles of Association.
10. The defendant submitted that clause 8C provides an alternative means of termination to the provision in the Corporate Membership Conditions but is not intended to act as a code which limits the defendant's rights of termination existing under other powers. In particular, it was submitted that nothing in that clause purports to limit the circumstances in which membership might be terminated in accordance with the Corporate Membership Conditions; they are merely alternative powers which may be used "as circumstances require".
11. The defendant's submissions also referred to the Renewal Conditions to which members agreed in renewing their membership with the defendant. Prior to 1 January 2013, corporate members of the defendant were required to renew their membership every two years. The last renewal submitted by Steve Parrott Pty Ltd was by application dated 15 September 2012. That application was signed by Mr Parrott. In that application, Steve Parrott Pty Ltd made the following declaration: I solemnly and sincerely declare that... I have read the current version of the General Conditions of the Bushfire Planning and Design Certification Program and the relevant Certification Guide for the business's Certified Business category. I acknowledge that the business for which I am the responsible officer will continue to abide by the certification conditions and the expectations of Certified Practitioners and Businesses specified in the above documents and will accept the decisions of FPA Australia or a representative of FPA Australia. I acknowledge that the business for which I am the responsible officer will continue to abide by the FPA Australia Code of Practice.
12. The defendant submitted that the effect of that declaration was to incorporate the terms of the General Conditions and the Code of Practice into the agreement between Steve Parrott Pty Ltd and the defendant. As already noted, the plaintiffs' pleading appears also to accept that to be the case and indeed invokes those same contractual documents.
13. The defendant submitted that the declaration further confers a broad power on the defendant in its superintendence of the General Conditions and the Code of Practice by requiring members to "accept decisions" of the defendant in respect of the operation of those documents. That could not derogate from any entitlement to challenge any decisions in accordance with the provisions of those same documents, but I accept that the declaration records common acceptance of the importance of a cooperative approach. The reason for requiring such a declaration is obvious and should not be controversial. In the important field of bushfire risk assessment, transparency and cooperation would be essential features of any accreditation scheme.
14. Around the time Steve Parrott Pty Ltd renewed its membership in September 2012, Mr Parrott, on behalf of the company, also executed a Code of Practice/Insurance Declaration dated 12 June 2012 in which he made the following declaration: On behalf of the companies listed above, I hereby declare and agree to the following in renewing my membership: …. 2. That I will continue to abide by the FPA Australia terms and conditions of membership as outlined at www.fpaa.com.au/members/?member=details.
15. The website address took the reader to a document containing the Corporate Membership Conditions, including the suspension and termination provision set out above. As submitted by the defendant, that declaration served to confirm the company's agreement to that term as a condition of its membership.
16. The defendant submitted that, in the period from its membership renewal in September 2012 until its termination as a member of the defendant in April 2013, the company's contract with the defendant incorporated: 1. the Corporate Membership Conditions (by reason of both the 2008 Corporate Membership Application and the 2012 Code of Practice/Insurance Declaration); 2. the General Conditions (incorporated by means of the declaration in the 15 September 2012 renewal); 3. the Code of Practice (incorporated by means of the declaration in the 15 September 2012 renewal); and 4. the Articles of Association (by operation of s 140 of the Corporations Act 2001 (Cth)).

Contract between the defendant and Mr Parrott

1. A similar, but not identical, contractual framework governed the relationship between the defendant and Mr Parrott. However, as already noted, Mr Parrott was not himself a member of the defendant.
2. Mr Parrott's last renewal of his practitioner certification was dated 10 September 2012. That renewal was for a period of two years. The renewal form contained the following statement: Certification requirements To maintain your Practitioner certification you must: … Continue to abide by the certification conditions and the expectations of Certified Practitioners specified in the current version of the General Conditions of the Bushfire Planning and Design Certification Program...
3. Later in the same document, Mr Parrott gave a declaration in the following terms: I solemnly and sincerely declare that... I have read the current version of the General Conditions of the Bushfire Planning and Design Certification Program and the relevant Certification Guide for my Certified Practitioner Category. I will continue to abide by the certification conditions and the expectations of Certified Practitioners in the above documents and will accept the decisions of FPA Australia or a representative of FPA Australia. (Emphasis added.)
4. As submitted by the defendant, the effect was that Mr Parrott contracted with the defendant to abide by the General Conditions, including by agreeing to accept decisions of the defendant as to the operation and requirements of the General Conditions and the Code of Practice.
5. The defendant also noted that, under the General Conditions, certification holders are required to comply with the Code of Practice. Accordingly, by agreeing to be bound by the General Conditions, Mr Parrott also agreed to be bound by the Code of Practice.

Summary of Contractual Terms

1. The defendant summarised the contractual provisions governing the contractual relationship between the defendant and each plaintiff in the following table in its written submissions: Party Governing Documents • Articles of Association Steve Parrott Pty Ltd • Corporate Membership Conditions • General Conditions • Code of Practice Mr Parrott • General Conditions • Code of Practice

1. The defendant submitted that the plaintiffs' case ignores certain of those documents and the contractual rights and obligations they impose. In particular, it was submitted that the plaintiffs had failed to grapple with the defendant's powers of suspension and termination under the Corporate Membership Conditions and the circumstance that each plaintiff undertook to accept the defendant's decisions regarding the operation of the General Conditions and the Code of Practice.

Defendant's right to request documents

1. As will be clear from the circumstances explained above, the point at which the parties reached an impasse (ultimately resulting in the termination decision) was when the plaintiffs refused to produce the documents sought in the letter of 3 January 2013. Accordingly, a critical issue in the proceedings is the defendant's power to compel members and accredited practitioners to produce documents.
2. Mr Parker SC, who appears with Mr Yezerski for the defendant, relied upon two contractual provisions pursuant to which the defendant is entitled to seek, and members are obliged to produce, documents upon request. The plain purpose of those provisions is to enable to defendant to monitor compliance with the obligations of members and practitioners under the General Conditions and the Code of Practice.
3. The first is found in the General Conditions of the scheme, as follows: [29] Those seeking certification or who are already certified agree to provide FPA Australia with documentation when requested.
4. The second is found in the audit provisions of the Code of Practice. Clause 5.2 of the Code of Practice provides: 5.2 Monitoring Code Compliant Companies Code Compliant Companies are responsible for meeting obligations to maintain compliance. FPA Australia reserves the right to request Code Compliant Companies to complete self-audit documentation to demonstrate processes and procedures are in place to meet compliance requirements. FPA Australia also reserves the right to conduct a compliance audit or to appoint an independent auditor to conduct such an audit.
5. The defendant submitted that, by that provision, members agreed to produce documents upon request to enable it to monitor compliance with the scheme. Although no audit was conducted in the present case, Mr Parker submitted that "the greater must include the less". He submitted that such an entitlement would not be read down when regard is had to the context in which it was agreed (that is, in the important undertaking of maintaining best practice in the profession of bushfire risk assessment).
6. Read alone, those provisions plainly create an entitlement of the defendant to request documents irrespective of any complaint or investigation. The burden of the plaintiffs' argument was that, in the present case, the defendant was undertaking an investigation in response to a written complaint and so was constrained to follow the process contemplated by clause 5.3 of the code, which provides: Suspected breaches of the Code must be reported in writing to the Executive Director FPA Australia with the complainant identifiable and contactable and include: A brief outline of the complaint; and Copies of all correspondence exchanged between the complainant and the Code Compliant Company in regards to the complaint being reported to FPA Australia. The Code does require the complainant to first raise a complaint with the Code Compliant Company and attempt to resolve the dispute before a formal complaint is lodged with FPA Australia. The exception would be a complaint covered under section 34.10 of this Code. The Executive Director will initially investigate the validity of a reported breach of the Code. If the validity of the complaint is sustained the Executive Director will recommend to COPSAC that a formal investigation be undertaken. Relevant stakeholders will be written to and a file established to keep records of all correspondence received and sent in regards to the complaint. The Executive Director will: a) receive allegations about breaches of this Code; b) investigate all alleged breaches; c) determine whether a breach has occurred, and if appropriate, refer the matter to the Code of Practice Strategic Advisory Committee.
7. The proposition contended for by the plaintiffs appeared to be that whereas in the absence of any complaint the defendant is entitled to request a member to produce any document it sees fit, once a written complaint has been received that entitlement is implicitly qualified by the requirements of clause 5.3, which include the requirement that the complainant "first raise a complaint with the [member company] and attempt to resolve the dispute before a formal complaint is lodged".
8. Mr Fernon, who appears for the plaintiffs, sought to support that contention by reference to clause 5.1 of the Code of Practice, which provides that the defendant "may instigate investigation without receipt of a written complaint where it has reason to believe that a Code Compliant Company is acting in breach of the Code provisions." The suggestion was that investigations are subject to a binary classification (either based on a written complaint or not) and that the receipt of a written complaint has the result that the investigation must be conducted strictly in accordance with clause 5.3.
9. Clause 5.3 is a difficult provision, purporting on its face to bind complainants (who would have no contractual or other relationship with the defendant) as well as the defendant's corporate members. It deals with disparate topics, ranging from the form in which a complaint should be presented to an outline of the obligations of the Executive Director. The part concerning the putative obligation of a complainant first to raise a complaint with the member company and attempt to resolve the dispute before lodging a formal complaint appears to be directed primarily at commercial disputes. There would be many other kinds of complaints which would not be susceptible of resolution with a complainant, particularly where a complaint raised the broader, more fundamental issue of the appropriateness of an individual practitioner holding accreditation under the scheme. I would not read clause 5.3 as an exhaustive code of the manner in which the defendant is entitled to investigate complaints of the kind made by Ms Gorrie.
10. In my view, the suite of documents governing membership and accreditation must be construed having regard to the context in which they are entered into, which derives (albeit indirectly) from the statutory regime addressing the serious risks posed by bushfire in this country. If, for example, the defendant received a written complaint asserting that an accredited practitioner was an arsonist, it would be absurd to construe the Code as imposing an obligation on the complainant to "attempt to resolve the dispute" before the defendant could investigate it. It would be equally absurd to think that the defendant could not request the production of documents without first identifying the complainant and giving particulars of the complaint, as asserted by the plaintiffs in the present case.
11. That, of course, is an extreme example. The present case was, in a sense, at the other end of the scale. The complaint received by the defendant was not sufficiently cogent to enable the defendant to form a view as to whether a breach had occurred. The further material provided by the NSW Rural Fire Service took the matter a little further, prompting Mr Wyborn to form a suspicion that there had been breaches of the Code. However, as stated several times in the correspondence, the defendant needed to see the plaintiffs' documents before determining whether there was an occasion for calling upon the plaintiffs to answer the complaint.
12. I am not persuaded that the defendant's entitlement to request the production of documents was qualified in the manner contended for or was conditional upon an obligation to provide the particulars sought by the plaintiffs. In the contractual context in which this issue falls to be determined, I am not persuaded that the plaintiffs were denied procedural fairness in the investigation of the complaint. In my assessment, the plaintiffs' claim wholly misconceives their rights and obligations at the point the investigation had then reached.
13. In particular, the plaintiffs' contention that they could not answer the defendant's request until they received the particulars sought was factually wrong and contractually misconceived. It was factually wrong because all that was sought was historical material - its collation did not require any evaluative assessment of the charge made by the complainant (which, in my view, had been adequately summarised in the defendant's correspondence in any event). It was contractually misconceived because the defendant's right to request the production of documents was not qualified by any obligation to justify or explain the basis on which they were sought (provided they were sought for a proper purpose, which was plainly the case here).
14. Perhaps most fundamentally, the position adopted by the plaintiffs was irrational. The defendant had repeatedly explained that it needed the documents in order to determine whether there was any charge to answer; self-evidently, the particulars of any charge could not be provided unless and until that determination was made (for which purpose, the documents had to be produced).
15. In my view, the defendant was correct to conclude that, after the third deadline for production passed, the plaintiffs were refusing to comply with a proper request and so were in breach of the provisions of the General Conditions and the Code of Practice set out above relating to the production of documents.

Defendant's right to terminate

1. More difficult questions arise as to the suspension and termination decisions. As noted above, although the articles of association provide a procedure for suspension and termination of membership, Mr Parker acknowledged that, in the present case, the defendant did not suspend the corporate plaintiff's membership in accordance with that procedure (since there had not been a formal meeting of the board). He submitted, however, that the existence of those provisions does not imply an exclusive method of suspension or termination and that the Corporate Membership Terms provide an independent basis on which membership can be suspended or terminated. [30]
2. The relevant provision is considered above. For convenience, the complete clause is repeated below: Termination and Suspension Membership will be suspended if subscription fees are not paid within 60 days of the date of invoice from FPA Australia and may thereafter be terminated at the sole discretion of the Board. Any member who breaches any provision of the Memorandum and Articles of Association or as a signatory fails to comply with the Code of Practice, or is guilty of any misconduct or other action deemed inappropriate by the Board may have their membership immediately suspended or terminated at the sole discretion of the Board. If a member's membership is terminated or suspended the member must immediately cease from holding out or otherwise representing that the member is in any way connected with or interested in FPA Australia.
3. Mr Fernon submitted that the Corporate Membership Conditions do not form any part of the contractual relationship because the completion of an application form merely constitutes an offer to become a member and that there was no acceptance by the defendant. He submitted that the relationship between the defendant and its members can be governed only by the articles of association, which carry the force of s 140 of the Corporations Act.
4. To the extent that the submission turned on offer and acceptance, I would reject it. In my view, the circumstances outlined above make plain that the Corporate Membership Conditions were accepted by Mr Parrott on behalf of the company and, subject to any inconsistency, form part of its contract with the defendant.
5. The more difficult question, however, is whether the clause relating to termination and suspension can have operative force in a context where the Articles of Association themselves provide a mechanism of suspension and termination of membership. The question is whether the Corporate Membership Conditions can be construed so as to derogate from or truncate the procedural entitlements of members provided by the Articles.
6. Mr Parker's position, as I understood it, was that it is ultimately not necessary to determine that difficult question, because the plaintiffs' refusal to provide documents was such a fundamental breach of the company's contract with the defendant as to repudiate it. He noted that the plaintiffs were clearly warned of the defendant's position in that respect, in the letter sent by Mr Williams on 8 March 2013. The correspondence made plain that the investigation itself was still in progress and that the defendant had not determined if there was a case against the plaintiffs and could not do so until the requested documents were produced. Failure to produce the documents was described as "an automatic breach" of the Code of Practice and the General Conditions.
7. In the circumstances, Mr Parker submitted that the failure to produce the documents amounted to repudiation, on the part of both plaintiffs, of their respective contracts with the defendant.
8. On that analysis it would not matter that the board of the defendant did not meet prior to the suspension of the company's membership and Mr Parrott's accreditation. Mr Parker submitted that the defendant could accept a repudiatory breach by any means it chose and that the CEO could do that on the defendant's behalf.
9. Mr Parker accepted that the defendant's letter of 20 March 2013 was not clear in some respects, including in its failure to distinguish between the company, the trading name and Mr Parrott. He submitted, however, that the critical question is whether grounds for termination in fact existed regardless of the way in which the letter was expressed. Mr Parker said that, if authority were needed for that proposition, it may be found in the decision of the High Court in Shepherd v Felt and Textiles of Australia Ltd (1931) 45 CLR 359. As noted by Mr Parker, that was a case in which the circumstances warranting termination of a contract of agency were not known until after the contract had been terminated; the position is a fortiori in a case such as the present, where the defendant knew of the repudiatory conduct but did not characterise it (in the correspondence) in the terms in which a lawyer might have.
10. Mr Fernon submitted that there can be no repudiation where a party seeks to enforce a right he genuinely believes to be in accordance with the contract, citing the decision of the High Court in DTR Nominees Pty Ltd v Mona Homes Pty Ltd (1978) 138 CLR 423 at 432; [1978] HCA 12 at [21].
11. I do not think that principle assists the plaintiffs. In the passage relied upon, the majority said (Stephen, Mason and Jacobs JJ; Aickin J agreeing; Murphy J dissenting in terms inconsistent with the plaintiffs' contention): No doubt there are cases in which a party, by insisting on an incorrect interpretation of a contract, evinces an intention that he will not perform the contract according to its terms. But there are other cases in which a party, though asserting a wrong view of a contract because he believes it to be correct, is willing to perform the contract according to its tenor. He may be willing to recognize his heresy once the true doctrine is enunciated or he may be willing to accept an authoritative exposition of the correct interpretation. In either event an intention to repudiate the contract could not be attributed to him.
12. However, as submitted by Mr Parker in reply, that was a case in which the respondent, Mona Homes, had terminated the contract without any articulation of its interpretation of the contract. The majority said (at 432, [22]): In this case the appellant acted on its view of the contract without realizing that the respondents were insisting upon a different view until such time as they purported to rescind. It was not a case in which any attempt was made to persuade the appellant of the error of its ways or indeed to give it any opportunity to reconsider its position in the light of an assertion of the correct interpretation. There is therefore no basis on which one can infer that the appellant was persisting in its interpretation willy nilly in the face of a clear enunciation of the true agreement.
13. Those remarks cannot be invoked in favour of the plaintiffs in the present case. On the contrary, this is a case in which the defendant gave a clear account of its interpretation of the correct contractual position, giving them every opportunity to reconsider their position. The plaintiffs' refusal to provide documents was firm and unequivocal. Contrary to Mr Fernon's submission, I do not think it was premised upon a different interpretation of the contract. Rather, it was premised upon an undifferentiated notion of entitlement to "natural justice", in the pursuit of which the plaintiffs repeatedly professed their intention to commence legal proceedings. I see no reason to conclude that was anything other than outright rejection of their contractual obligations.
14. In my view, the defendant was entitled to regard that as such a fundamental breach of the contract as to amount to repudiation. In the field of risk assessment, particularly a risk with such potentially catastrophic consequences, transparency and cooperation are of the utmost importance. This was not a question of a potential breach of the practices imposed by the Cope of Practice or the General Conditions; it went to the heart of the defendant's role in providing certification to that end. The refusal to cooperate with the process threatened the defendant's capacity to proceed to investigate a complaint which, if established, was a serious matter. As already noted, that is not to make any assumption as to the merits of the complaint. The point is it needed to be investigated and the plaintiffs were refusing to cooperate in that process in the manner required by their contract.
15. In the circumstances, I am persuaded that the plaintiffs each repudiated their contract with the defendant.
16. A further question raised by the plaintiffs is whether the defendant accepted the repudiation. In my view, it is plain that it did. In submitting otherwise, Mr Fernon relied on the language of the letter of 20 March which he submitted tended to affirm rather than accept repudiation of the terms of the contract. For the reasons already explained, I do not think the language of the letter derogates from its clear operation; the substance of the defendant's position was that the refusal to provide documents was an "automatic breach" rendering the plaintiffs' contractual position untenable and that the contracts were being terminated on that basis.
17. I am satisfied that the contracts were validly terminated upon the defendant's acceptance of the plaintiffs' repudiation. On that basis, the plaintiffs' claim in contract fails.

Claim for misleading or deceptive conduct

1. The claim in misleading or deceptive conduct was added by amendment on the second day of the hearing and was not addressed in any great detail by either party. It arose from the matter disclosed by Mr Parker in his opening address, namely, that there was no minute to be produced recording the suspension decision because the board of the defendant did not in fact meet when that decision was made; that was an act of the CEO, Mr Williams. There is no suggestion that the decision did not accord with the views of the individual members of the board but the required formality of convening a meeting did not occur.
2. The basis for the claim is that, in the circumstances, the representation in the letter dated 20 March 2013 that the suspension of the company's membership and Mr Parrott's accreditation was a determination of the board (and the consequential removal of their names from the relevant registers) amounted to misleading or deceptive conduct.
3. On the conclusion I have reached regarding repudiation, that claim must also fail. As submitted by Mr Parker, if there was repudiatory breach, the repudiation could be accepted by the defendant in any manner it chose; it was not necessary for that to be a decision of the board. On that analysis, the representation as to suspension was true in substance; the incorrect description of the process is of no moment, in my view.
4. In the circumstances, it is not necessary to consider the claim for damages.
5. For those reasons, the proceedings are dismissed. It would ordinarily follow that the plaintiffs would be ordered to pay the defendant's costs. If either party seeks a different order, leave will be granted to file a short written submission within 14 days identifying the order sought and the basis on which it is sought, failing which an order that the plaintiffs pay the defendant's costs will be entered.

Endnotes

1. Environmental Planning and Assessment Act 1979 (NSW), s 79BA(1)(b); State Environmental Planning Policy (Exempt and Complying Development Codes) 2008, regulation 3.36B.
2. T146.48.
3. Affidavit of Christopher Wyborn affirmed 12 May 2014, para 23.
4. Mr Wyborn's affidavit, paras 25 to 26.
5. Statement of claim filed 24 September 2013, paras 16 to 20.
6. T36.30.
7. T34-35.
8. Amended statement of claim filed in court on 8 December 2015.
9. Affidavit of Mr Parrott sworn 29 March 2014, para 6.
10. Mr Wyborn's affidavit, para 13.
11. Mr Parrott's affidavit of 29 March 2014, para 49.
12. Mr Wyborn's affidavit, paras 9, 11.
13. Exhibit A, page 527.
14. A document propounded by the NSW Rural Fire Service, in evidence in Exhibit A, page 354.
15. Mr Wyborn's affidavit, para 40.
16. T80.29.
17. Exhibit A pages 680 - 684
18. Exhibit B, page 794.
19. Exhibit B, page 793.
20. Exhibit B, page 795.
21. Exhibit B, page 796.
22. Exhibit B, page 798.
23. Exhibit B, page 800.
24. Exhibit B, page 801.
25. T59-60.
26. Exhibit B, page 817.
27. Amended statement of claim, para 6.
28. Amended statement of claim, para 7.
29. Exhibit A, page 479.
30. Exhibit A, page 459. 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: 10 October 2016