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St Vincent de Paul Society Qld v Ozcare Ltd[2009] QCA 335

Reported at [2011] 1 Qd R 47

St Vincent de Paul Society Qld v Ozcare Ltd[2009] QCA 335

Reported at [2011] 1 Qd R 47
 

SUPREME COURT OF QUEENSLAND

 

CITATION:

St Vincent de Paul Society Qld v Ozcare Ltd & Ors [2009] QCA 335

PARTIES:

ST VINCENT DE PAUL SOCIETY QUEENSLAND
(plaintiff/appellant)
v
OZCARE LIMITED
(first defendant/first respondent)
KEITH ALEXANDER TURNBULL, ANTHONY BERNARD GODFREY, ANDREW MARK WEIL, FREDERICK CHARLES GILLETT, MICHAEL FRANCIS McCABE, MEL JAMES BREEN, MATTHEW PHILIP VANDERBYL, BRIAN TREVOR LENZ
(second defendants/second respondents)

FILE NO/S:

Appeal No 4401 of 2009
SC No 5314 of 2006

DIVISION:

Court of Appeal

PROCEEDING:

General Civil Appeal

ORIGINATING COURT:

Supreme Court at Brisbane

DELIVERED ON:

30 October 2009

DELIVERED AT:

Brisbane 

HEARING DATE:

5 October 2009

JUDGES:

McMurdo P and Muir and Chesterman JJA
Separate reasons for judgment of each member of the Court, each concurring as to the orders made

ORDERS:

  1. The appeal be allowed;
  1. Paragraphs 5 and 6 of the Order made on 31 March 2009 be set aside;
  1. The persons named in paragraph 1 of the application filed on 3 December 2008 be joined as second defendants in the proceeding;
  1. The costs of and incidental to the application filed 3 December 2008, the hearing in respect of it, and the costs of this appeal be the parties' costs in the proceeding;
  1. The appellant file and serve an amended Statement of Claim within 21 days of today's date;
  1. The respondents file and serve an amended defence or amended defences within 21 days of service on them of the amended Statement of Claim;
  1. Within 28 days of today's date the appellant apply to the supervised case list judge for such orders as the judge may make at his or her discretion with a view to ensuring the mediation of the dispute between the parties, if the judge considers that appropriate, and for the expeditious determination of the proceeding;
  1. Before the hearing of the application referred to in paragraph (7), the legal representatives of the parties confer with a view to: agreeing draft directions for consideration by the supervised case list judge limiting the extent of disclosure and considering whether it would be advantageous for there to be a trial of any separate issues.

CATCHWORDS:

PROCEDURE – SUPREME COURT PROCEDURE – QUEENSLAND – PROCEDURE UNDER RULES OF COURT – PARTIES – JOINDER AND ADDITION OF PARTIES – where primary judge refused appellant’s applications for leave (i) to join members of first respondent ("the Members") as second defendants in the action and (ii) to amend the Claim and Statement of Claim to effect the proposed joinder – where reason for refusal based on failure to disclose a cause of action warranting joinder – whether such a cause of action disclosed – whether joinder and proposed amendments permitted

EQUITY – TRUSTS AND TRUSTEES – CONSTRUCTION AND CLASSIFICATION OF TRUSTS GENERALLY – CLASSIFICATION OF TRUSTS IN GENERAL – IMPLIED TRUSTS – CONSTRUCTIVE TRUSTS-INDEPENDENT OF INTENTION – GENERAL PRINCIPLES – where appellant alleged, inter alia, that parcels of the appellant’s real property were transferred to the first respondent without consideration in breach of trust – where appellant alleged, consequent upon breach, the Members held their interests, arising from their membership of the first respondent, on trust for the appellant – where respondents submitted that interests of the Members were not recognised by law as "property" and were incapable of being held on trust – where primary judge accepted respondents' submissions and found no cause of action arose – whether Members’ interests capable of constituting "property" and thus being held on trust for the appellant

Corporations Act 2001 (Cth), s 9, s 112(1), s 119, s 231, s 1070A
Uniform Civil Procedure Rules 1999 (Qld), r 69, r 378

Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue [2009] HCA 41, cited
Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106; [1992] HCA 45, cited
Bailey v The Uniting Church in Australia Property Trust (Qld) [1984] 1 Qd R 42, cited
Colonial Bank v Whinney (1885) 30 Ch D 261, cited
National Provincial Bank Ltd v Ainsworth [1965] AC 1175; [1965] UKHL 1, considered
Newcastle City Council v GIO General Ltd (1997) 191 CLR 85; [1997] HCA 53, cited
Secure Parking (WA) Pty Ltd v Wilson [2008] WASCA 268, cited
Tasmanian Seafoods Pty Ltd v Peters [1999] QSC 144, cited
The Queen v Toohey; Ex parte Meneling Station Pty Ltd (1982) 158 CLR 327, [1982] HCA 69, cited
WACB v Minister for Immigration and Multicultural and Indigenous Affairs (2004) 210 ALR 190; [2004] HCA 50, cited
White v Shortall (2006) 68 NSWLR 650; [2006] NSWSC 1379, cited
Wilcox v Kogarah Golf Club Ltd (1995) 14 ACLC 421, cited

COUNSEL:

W Sofronoff QC, with D O'Sullivan, for the appellant
D J S Jackson QC, with P Franco, for the respondents

SOLICITORS:

Thynne & Macartney for the appellant
Clayton Utz for the respondents

  1. McMURDO P:  This appeal should be allowed.  It is reasonably arguable that the interests of the Members of the respondent, Ozcare Limited, arising from their membership of the respondent, were property capable of being held in trust for the appellant, St Vincent de Paul Society Queensland.  The primary judge erred in concluding otherwise.
  1. I agree with Muir JA's reasons and orders.
  1. MUIR JA:  The appellant/plaintiff appeals against a decision of a judge in the applications jurisdiction refusing leave to join members ("the Members")  of the first respondent/first defendant  ("the respondent") as second defendants in the action and against his refusal to give leave to amend the Claim and Statement of Claim to give effect to the proposed joinder.
  1. Before the primary judge, the respondents argued that the proposed amendments to the Claim and Statement of Claim in respect of the Members disclosed no arguable cause of action. The primary basis for this contention was the proposition that the interest of each Member in the respondent, arising from their membership, was not recognised by law as property and was thus incapable of being held on trust for the appellant, as the appellant's proposed amended Statement of Claim alleged.
  1. In his ex tempore reasons, the primary judge said:

"The primary objection of the defendants here is that the rights or entitlements, whatever they may be, fall short of constituting property and therefore are incapable of being made the subject of a trust either express or constructive.  Coupled with the fact that there could be no expressed trust in relation to members who became members subsequent to the incorporation of the company, certainly on the facts pleaded in the proposed pleading, it seems to me that the proposed amendments in so far as they are challenged, do not disclose a cause of action against the proposed second defendants to justify their being joined at this stage as parties to the proceedings."

  1. If the primary judge erred in his implicit finding that the interests of the Members in the respondent could not be held on trust, there will have been an error of law affecting the primary judge's decision and the discretion of whether to permit joinder will need to be exercised by this Court.

The factual background to the dispute between the appellant and the respondent

  1. On 1 February 1962, letters patent were issued by the Governor-in-Council pursuant to the Religious Educational and Charitable Institutions Act 1861 (Qld) declaring the appellant a body corporate.  In a broad sense the appellant is the Queensland branch of the Society of St Vincent de Paul, an international Catholic organisation of lay people founded in Paris in 1833 to carry out charitable works.
  1. The objectives of the Society of St Vincent de Paul in Australia and of the appellant are articulated in a booklet entitled The Rule of the Society of St Vincent de Paul in Australia.  The booklet is described in the draft amended Statement of Claim ("the Pleading") as "the Rule".  The Rule describes how, in Australia, there are to be branches (conferences) each of which is to have a president, an advisory board, consisting of at least one vice president, a secretary, a treasurer and a spiritual advisor.  Provision is made also for Regional, Diocesan and State councils.
  1. Article 2 of the Rule states that:

"The main work of a conference is visiting people in their homes, in hospitals, institutions and wherever else they may be found needing aid or comfort.  Those who are homeless have a special call on the charity of members.

Special works of the society rely on conferences for support, personnel and funds."

  1. In relation to acquisition of property, the Rule provides:[1]

"SOCIETY PROPERTY

The spirit of poverty requires that the Society does not encumber itself with ownership of property unless it is proven to be necessary to the work.  It does not expend funds on real estate as a capital investment and prefers to lease rather than purchase where economically viable.

The legal signatories of the Society are either trustees or members of incorporated bodies representing the national or their respective state councils.  They must be members of those councils and act only with the approval of the council concerned.

Accordingly all proposals to acquire property or enter into contracts in the name of the Society must be submitted through regional and diocesan councils if applicable, for the consideration of state council.  It is incumbent on state councils to investigate all such proposals in relation to the need for such a work, suitability of site, design of building and capacity to pay."

  1. The appellant's pleaded case places particular reliance on Article 32 of the Rule which provides:

"SPECIAL WORKS

Special works arise out of conference activity and are an example of mutual help and solidarity in that conferences co-operate in the carrying out of good works.

A special work is desirable where a conference, or a group of conferences, finds a need that cannot be satisfied within the normal scope of conference activity and there is an opportunity and capacity for person-to-person contact.  It must be financed after budgeting for the normal activities of the conference.

Examples of needs which are more effectively met by special works committees are literature distribution, homes or hostels for particular classes of deprived persons, and the organisation of district centres for the collection and distribution of clothing, furniture, etc.

Special works should be small and personal rather than large and impersonal.  The size is relative to the type of work, place and strength of membership.

Special works are managed by a conference committee under the control of a president appointed by the council in whose area the work is located.  It is important that the work has a spiritual adviser who is appointed by the council president after consultation with the parish priest (or with the Ordinary of the Diocese, if more appropriate), and with the members of the council and the special work conference or committee.

Special work conferences or committees are subject to the authority of their council and must report at regular intervals on the progress and conduct of the work.

The Society can transfer a special work to any competent authority subject of course to previous agreements made with government or Church authorities.

The financial records of every special work must be audited annually and signed accounts supplied to the council."

  1. In 1995 the appellant's Queensland State Council was persuaded, for a variety of reasons, that a company should be incorporated with a view to carrying on particular major beneficial activities including the ownership and operation of aged care facilities, homeless persons' facilities and nursing services. As part of this plan of action, it was proposed that a substantial part of the appellant's real property be transferred to the new entity.
  1. Minutes of a meeting of the Queensland State Council of the appellant, held on 27 – 28 May 1995, record:

"13.04The President asked Council to consider carefully proposals to change the structure of the Society.  He thanked Father Turnbull, Brian Lenz and Bro[2] Tim for bringing the matter to the stage it is today.

13.06State Council considered the proposals put forward in Bro Tim's paper in relation to Special Works and the following resolution was unanimously adopted –

  1. A new incorporated body and legal entity be created and the following Special Works (predominantly funded by Government Subsidy) transferred to its control:

All Aged Care Facilities (Hostels, Respite Centre);

Nursing Home;

Correctional Centre;

All Nursing Services;

Large Scale Homeless Persons Facilities;

Other Special Works dependant on Government Funds.

2.New Structure to be finalised within next six months.

  1. New structure will be responsible for management, administration and all legal responsibility.
  1. This new body will remove legal onus and burden from State Council.
  1. Conferences currently engaged in activities with the abovementioned Special Works should remain in place.
  1. The General Secretary was directed to facilitate the transfer of all assets and liabilities of the associated Special Works to the new incorporated body in accordance with the above resolution.

MATTER AGREED/APPROVED

13.07The President proposed a Special Meeting to consider the process on Saturday 15 July 1995.

MATTER AGREED/APPROVED

13.08The mechanics of the above are to be worked through and a report prepared for Diocesan Presidents to advise their members.  Brian Lenz suggested that the legal costs to implement this proposal may be in the vicinity of $80,000 and that Diocesan Councils should make provision of approximately $10,000 each for this contingency.

AGREED"

  1. Minutes of a meeting of the State Council on 25 – 26 November 1995 record:

14.01Andrew Weil, a Partner in Walsh Halligan Douglas, Solicitors, was introduced to the meeting.  Andrew spoke of the legal requirements associated with the establishment of a new incorporated body to operate certain Special Works of the Society, and why such a body is necessary.

14.02The Rule makes it clear that such action is available to the Society.

14.03.Amongst the reasons advanced for formation of a new body are the following -

Changes in funding legislation in Australia, competition in obtaining Government funds, and the accompanying necessity for public accountability.

The State Government is encouraging charitable bodies to register under more appropriate legislation, which requires accountability and better disclosure.

There is a need to protect the Society from liability and from being sued. Without incorporation, any legal liability assessed against the Society would endanger the total assets. Separation of assets will reduce this risk.

The present structure of the Society does not allow us to comply with certain requirements of Government eg, Quality Assurance, whereas the new grouping will allow appropriate organisation.

14.04Centres of Charity and small Special Works will not be affected by the change - their operation remains the same.

14.05Following lengthy discussion with professionals, the best structure has been determined as a Company Limited by Guarantee.  No dividends would accrue to anyone and the liability of the members would be limited to a $10 guarantee.

14.06The name "St Vincent’s Community Services Limited" has been reserved.  Following incorporation, application will be made to have the word "Limited" deleted from the name.

14.07The Memorandum of Association sets out the goals of the Company - the main one of which is to achieve the objects of the Society.  The Articles of Association sets up the Rules under which the Company is run, and these are in accordance with the requirements of the Taxation Department and other Government Departments.

14.08The State President of the Society has the authority to appoint the first Chairperson of the new Company.

14.09All the relevant authorities have been approached to consider the status of the new Company to ensure that the current concessions in regard to Income Tax, Stamp Duty, Pay Roll Tax, Land Tax, etc, will continue to apply.

14.10Andrew emphasised that the Society will remain, day to day operations will not change and no current concessions eg, Taxation will alter.

14.11The President thanked Andrew for his presentation, and invited members to ask any questions they wished.

14.12Brother Mel asked State Council to confirm its previous resolution - That a new company be incorporated to which all large or predominantly Government funded special works (including all assets, liabilities, obligations and rights) of the Queensland Society would be transferred; and Brian Lenz, General Secretary, in consultation with Bro Mel Breen, State President, be authorised to take all steps to give effect to the contemplated transactions.

MATTER AGREED/APPROVED"

  1. An Australian Securities and Investments Commission search reveals that the respondent was registered as a company limited by guarantee on 11 January 1996.  The subscribers to the respondent's memorandum and articles of association, dated 13 December 1991, were Father Keith Turnbull, spiritual advisor to the State Council of the Society; Mr Breen, president of the State Council of the Society; Mr Lenz, general secretary of the State Council of the Society; Ms McGrath, State secretary of the Society; and Mr Andrew Douglas, partner in the firm, Walsh Halligan Douglas.  The first three of these subscribers are Members.
  1. Clause 2 of the respondent's objects provided:

"The objects for which the Company is established are:

(a)objects the same as the objects of the Society of St. Vincent De Paul Australia;

(b)to establish, conduct and carry on, at any place or places within Australia or elsewhere, homes, night shelters and other refuges for the poor, and generally to promote the welfare of the poor, the welfare of the socially or financially disadvantaged and the relief of distress, suffering and poverty, including but not limited to the following: …"  (Charitable or benevolent objects were then listed.)

  1. Clauses 4 to 6 of the memorandum of association provided inter alia:

"4.The income and property of the Company however derived must be applied solely towards the promotion of the objects of the Company as set out in this memorandum of association and no part of that income or property may be paid or transferred, directly or indirectly by way of dividend, bonus or otherwise by way of profit to members of the Company.  Except as allowed in this clause, no director of the Company may be paid by or receive from the Company any remuneration or other benefit in money or money’s worth …

  1. The liability of the members of the Company is limited.
  1. Every member of the Company undertakes to contribute to the assets of the Company if it is wound up while the member is a member, or within one year after the member ceases to be a member, for payment of the debts and liabilities of the Company contracted before the member ceases to be a member and for the costs, charges and expenses of winding up and for adjustment of the rights of the contributories among themselves, any amount required not exceeding $10.00."
  1. The Articles named Father Turnbull and Messrs Breen and Lenz "Founding Directors". Clause 3.6 provided for four classes of members:

(a) Directors;

  1. Senior Members;
  1. Participating Members; and
  1. Associate Members.
  1. Every Founding Director was stated to be a "Member in the class of Senior Members." Directors other than the "Founding Directors" and the "Executive Director" were subject to retirement by rotation.[3]  A quorum at general meetings was one director present in person, plus two directors present in person or by proxy or attorney.[4]  All members, other than Associate Members, had equal voting rights, except in relation to the appointment of a Director by Senior Members or on a resolution for the alteration of the memorandum or articles of association.  Only Senior Members were entitled to vote in those respects.[5]
  1. Under Clause 3.3, members ceased to be such on resignation, death, bankruptcy, becoming of unsound mind, dissolution (in the case of a corporation), or upon the directors terminating the person's membership.
  1. The minutes of the 27 – 28 May 1995 meeting record that Father Turnbull, Mr Breen, Mr Lenz, Mr Vanderbyl (also a Member) and Ms McGrath attended the meeting.  Mr Lenz, however, was recorded as having been present only on 28 May.  The minutes of the 25 – 26 November 1995 meeting record the presence of Father Turnbull and Mr Vanderbyl on 25 November, Mr Lenz on 26 November and Mr Breen and Ms McGrath on both days.  Mr Weil, a partner in the firm Walsh Halligan Douglas and a Member, was recorded as having attended and given advice.  The minutes also record that on 26 November 1995 Mr Godfrey "of Peden Lavis and Company, the State Council Auditors, was introduced."  Mr Godfrey is also a Member.
  1. From about February 1997 to February 1998 some 30 parcels of real property registered in the name of the appellant ("the land") were transferred to the respondent without consideration.

The amended Claim

  1. The amended claim included claims against the respondent for:
  1. A declaration that it holds the land on trust, upon the conditions and for the purposes described in the Rule;
  1. An order that the respondent transfer the land with the exception of one parcel, to the appellant;
  1. An order that the respondent account to the appellant for the net income derived from the land;
  1. All necessary accounts and enquiries;
  1. Alternatively, a declaration that the land was transferred to and knowingly received by the respondent in breach of trust and an order that the respondent account to the appellant for the value of the land, except for one parcel, as at the date of judgment in an amount assessed by the Court.
  1. The claims against the respondent and the Members were for:
  1. A declaration that the Members hold their rights and liabilities as members of the respondent on trust for the appellant; and
  1. Such orders as are necessary to give effect "to the existence of that trust including an order that [the Members] transfer their membership in the [respondent] to the [appellant] or at its direction …".

The amended Statement of Claim

  1. The amendments to the pleading in respect of which leave was refused are summarised below. The headings used are those in the pleading and the numbers at the end of paragraphs are references to the relevant paragraph in the pleading.

Declaration of Trust as to Membership of the First Defendant

  1. The appellant decided to incorporate the respondent, that Mr Breen appoint the first chairman of the respondent and that Father Turnbull be the first chairman, and that the land be transferred to the respondent (9);
  1. Such decisions were made and the incorporation of the respondent was effected for the purposes of the Rule (10);
  1. The signatories to the memorandum of association of the respondent:

(i)signed for the purposes of the charitable objects in the Rule;

  1. signed in order to form the respondent as a company for objects which included "objects the same as the objects of the Society of St Vincent de Paul";
  1. became members of the respondent;
  1. did not provide valuable consideration in order to acquire their rights as members; and
  1. held their rights as members on trust for the appellant (11).
  1. Any member taking membership in the respondent subsequent to its incorporation and the Members hold their rights as members on trust for the appellant (12); and
  1. The appellant is entitled to a declaration that the Members hold their rights as members of the respondent on trust for the appellant or, alternatively, for the charitable objects in the Rule (13).
  1. In the alternative, the decisions in paragraph 9 and the incorporation of the respondent were not for the purposes of the Rule and were in breach of trust (14).
  1. The signatories to the memorandum of association signed in order to form the respondent as a company in breach of trust.  They became members by virtue of such breach of trust, obtained their rights as members as a consequence of the breach of trust, provided no valuable consideration to acquire their rights and held such rights on constructive trust for the appellant (15).

(h) By reason of the foregoing matters, any member taking membership in the respondent subsequent to its incorporation and the Members hold or held their rights as members on constructive trusts for the appellant (16).

  1. The appellant is entitled to a declaration that the Members hold their rights and liabilities as members of the respondent on a constructive trust for the appellant (17).

Breach of trust by transferring property to an entity not being a competent authority

  1. The land was held on trust as alleged in the Claim (4);
  1. By the terms of the Rule, the appellant was not authorised to transfer property held by it on trust without consideration unless the property to be transferred was "Special Works" as defined by the Rule and the transfer was to a "competent authority" pursuant to Article 32 of the Rule (18);
  1. The respondent was not at relevant times a "competent authority" (20);
  1. The land was transferred to the respondent without consideration, not for the purposes of the trust and in breach of trust (21);
  1. The respondent by its Directors at all times knew the facts as alleged above (23); and
  1. In the premises the land is held in trust by the respondent for the above described charitable objects (24).

Breach of trust by miscarriage of the appellant's decision-making

Appellant's entitlement to dispose of the property

  1. The appellant's powers to incorporate the respondent and to transfer trust property to it were powers that could be used only for the charitable objects described in the Rule (25);
  1. Such powers were required to be exercised upon a real and genuine consideration and for the purposes for which they were conferred (25);
  1. Such powers were not so exercised (27);
  1. The decisions to incorporate the respondent and to transfer the property to it were made in breach of trust and were a nullity (27);
  1. In the premises the respondent continues to hold the property for the objects of the trust and is accountable to the appellant in respect of its receipt of and dealing with the property (27).

Incorporation of the respondent and transfer of property to it and Miscarriage of the appellant’s decision making

  1. The breach of trust and the trust alleged above are alleged to result from: the reasons for the relevant decisions and actions being "irrelevant and manifestly unsound (32 and 33); the inadequacy of the actions resolved to be taken (34); the transfer of full beneficial ownership of the land to the respondent; the loss of any interest in the land by the appellant; the absence of control of the respondent by the appellant and the fact that the parcels of land were not Special Works.

The appellant's proprietary rights

  1. The appellant has an equity against the respondent arising from its acts as registered proprietor within the meaning of s 185(1) of the Land Title Act 1994 (Qld); and the respondent holds the property for the charitable objects described above and is accountable for the property as a constructive trustee (40).
  1. These claims are justified because:
  1. The respondent received title to the property with the knowledge that it had been transferred in breach of trust (41 (a));
  1. Messrs Lenz, Breen and Weil were actively involved in the provision to the appellant of incorrect advice that the respondent was a "competent authority" and that transfer of the property to the respondent was permitted by the Rule (41 (b));
  1. Messrs Lenz, Breen and Weil were actively involved in providing to the appellant's State Council the inadequate and misleading reasons said to justify and require incorporating the respondent and transferring the property to it (41 (c));
  1. Mr Breen misled the appellant by stating on or about 20 January 1997 that the property would be held in trust and that it would revert to the appellant or a similar organisation, in order to procure that the resolutions be carried into effect, when that was untrue (41 (d));
  1. Mr Breen appreciated or, if acting reasonably, should have appreciated that the statements made in a facsimile dated 20 January 1997 to presidents, members, conferences and councils that the property would be held in trust and that it would revert to the appellant or a similar organisation were or might be untrue (41 (e));
  1. Messrs Lenz, Breen and Weil were instrumental in incorporating the respondent, transferring the land to it and taking control of the respondent as particularised (41 (f)); and
  1. The respondent was the instrument by which Messrs Breen and Lenz procured a transfer of the property from the appellant to the respondent in breach of trust (41 (g)).

Appellant's rights to payment for the value of the property

Knowing receipt

  1. On the principle known as "the first limb" of Barnes v Addy, the respondent obtained registered and indefeasible title to the land with knowledge that it was transferred in breach of trust and is thus accountable for that receipt (42).
  1. The respondent is also liable to account to the trust estate for the value of the land and its fruits (43).

Re Diplock special equity

  1. The assignment of the property was a distribution of trust property within the meaning of s 109(1) of the Trusts Act 1973 (Qld).  It was made in breach of trust.  By reason of s 109(1) of the Trusts Act 1973 (Qld) the appellant is entitled to enforce the same remedies against the respondent as in the case of a personal representative who has wrongly distributed the estate of a deceased person. (45)
  1. By virtue of the matters pleaded, the respondent is obliged to pay the appellant the current value of the land with the stated exceptions. (51)

Are the second respondents' rights as Members of the first respondent capable of being held on trust?  – the respondents' submissions

  1. The submissions advanced by counsel for the respondents were to the following effect. For a trust to be created, the obligation imposed on the trustee must relate to some specific property.[6]  Reference was made to the statement of Higgins J in Public Curator (Qld) v Union Trustee Co of Australia Ltd[7] in which his Honour said:

"A trust must be associated with property, and rights to property.  As Story said (Contracts, vol. 1., sec. 296), 'trusts are, therefore, equitable interests in property, based on confidence, over which Courts of equity alone have full jurisdiction.'"

  1. Reliance is placed also on a statement in Jacobs' Law of Trusts in Australia[8] that, "The second essential element [for the creation of a trust] is that there should be property capable of being held on trust."
  1. The rights of the Members of the respondent do not constitute property capable of being held on trust as they:
  1. are unassignable;
  1. are personal (they may only be held by persons subscribing to the Catholic or Vincentian ethos); and
  1. lack any commercial value.
  1. While there is no single test for determining what constitutes property, assignability has been referred to as the "hallmark" of property[9] and the primary judge was correct "to treat it as a principal consideration".
  1. Brennan J stated in Australian Capital Television Pty Ltd v The Commonwealth:[10]

"In Reg v Toohey; Ex parte Meneling Station Pty Ltd, Mason J cited with approval the definition of property given by Lord Wilberforce in National Provincial Bank Ltd v Ainsworth:

'Before a right or an interest can be admitted into the category of property, or of a right affecting property, it must be definable, identifiable by third parties, capable in its nature of assumption by third parties, and have some degree of permanence or stability.'

His Honour added:

'Assignability is not in all circumstances an essential characteristic of a right of property. By statute some forms of property are expressed to be inalienable. Nonetheless, it is generally correct to say, as Lord Wilberforce said, that a proprietary right must be 'capable in its nature of assumption by third parties'.'

Although property is generally assignable, that is not universally so for, as Isaacs J said in Commissioner of Stamp Duties (NSW) v Yeend, '[a]ssignability is a consequence, not a test' of a proprietary right. Assignability may therefore be denied to what is, by other tests, properly found to be property. Nonetheless, the want of assignability of a right is a factor tending against the characterization of a right as property."  (footnotes deleted)

  1. Reference was made to a discussion in Ford & Lee Principles of the Law of Trusts[11] in which there was discussion concerning the circumstances in which a licence could be regarded as property, although not transferable without consent or where the transfer was dependant on the intended transferee meeting certain personal requirements.  In the course of the discussion it was observed that:

"For a licence to be transferable for the purpose of assisting its characterisation as property it is enough if there is no prohibition on creating an equitable interest in it even if there is a prohibition on the transfer of the legal title:  Edwards v Olsen (1996) 67 SASR 266 … Tasmanian Seafoods Pty Ltd v Peters [1999] QSC 144…."

  1. The subject rights are "intimately personal" as a member must accept either the philosophy of the Society of St Vincent de Paul or accept the Catholic ethos and membership terminates upon a member's death.
  1. The requirement that a member accept either the philosophy of the Society or the Catholic ethos is analogous to the requirement that a licence be granted "on the personal fitness of the applicant". Such a requirement has led to the conclusion that a publican's licence is not property.[12]  Counsel referred to the observation by Griffith CJ in The Queen v Miller[13] that, "A right that is personal is not property, even if the right may be transferred."[14]
  1. The Members of the respondent have no right to receive dividends or to share in the assets of the respondent on dissolution. The rights have no commercial value and thus lack the common indicia of property rights.[15]
  1. The right to appoint directors may constitute a power but is not property.[16]
  1. The appellant's reliance on s 1070A of the Corporations Act 2001 (Cth) ("the Act") is misguided.  The section does not have the effect that the rights of the Members of the respondent are properly capable of being held on trust, as the respondent has no shares and is not a registered scheme.  "The section will only apply to any 'other interest of a member in a company'."  "Interest" is a reference to "interest as member" but the term "interest" is used to connote a proprietary interest.  Support for that proposition is to be found in the definition of "interest" in the Macquarie Dictionary.[17]  The relevant objects of Chapter 7 of the Act, in which s 1070A is to be found, are to ensure "fair, orderly and transparent markets for financial products" and "confident and informed decision making by consumers of financial products …" (s 760A).  It furthers these objects by regulating dealings in marketable proprietary interests.  Where the interest of a member of a company limited by guarantee is capable of assignment, the section has a role to play in characterising its nature.  However, it does not further those objects to provide for the assignment of rights, which, as here, are personal, unassignable and have no market value.
  1. The role of s 1070A(1)(a) is not to delineate between what is property and what is not, it is to clarify for conflict of laws purposes and the like that members' proprietary interests in a company are personal rather than real property. This is apparent from s 90 of the Companies Act 1961 (Qld), a predecessor to s 1070A, which provided that:

"The shares or other interest of any member in a company shall be personal estate, transferable in the manner provided by the articles and shall not be of the nature of real estate."

Are the Members' respective interests in the respondent personal property?

  1. Counsel for the appellant relied on s 1070A of the Act which at relevant times provided:

"Nature of shares and certain other interests in a company or registered scheme

(1)A share, other interest of a member in a company or interest of a person in a registered scheme:

(a)is personal property; and

(b)is transferable or transmissible as provided by:

(i)the company’s, or scheme’s, constitution; or

(ii)the operating rules of a prescribed CS facility if they are applicable; and

(c)is capable of devolution by will or by operation of law.

(2)Paragraph (1)(c) has effect subject to:

(a)in the case of a company:

(i)the company’s constitution (if any); and

(ii)any replaceable rules that apply to the company; and

(iii)the operating rules of a prescribed CS facility if they apply to the share or interest; and

(b)in the case of a scheme:

(i)the scheme’s constitution; and

(ii)the operating rules of a prescribed CS facility if they apply to the interest.

(3)Subject to subsection (1):

(a)the laws applicable to ownership of, and dealing with, personal property apply to a share, other interest of a member in a company or interest of a person in a registered scheme as they apply to other property; and

(b)equitable interests in respect of a share, interest of a member in a company or other interest of a person in a registered scheme may be created, dealt with and enforced as in the case of other personal property."  (emphasis added)

  1. In subsection (1) it is stated, in terms, that "A share, other interest of a member in a company … is personal property." The respondents nevertheless contend that s 1070A(1) must be read in the light of the objects of Chapter 7 so that paragraph (a) is not to be given its literal meaning.  The argument must be rejected.
  1. I have not attempted to trace the origin of s 1070A back to its original source but it has a considerable heritage. Section 22 of the Companies Act 1862 (U.K.) which appeared in Part II of that Act entitled "Distribution of Capital and Liability of Members of Companies and Associations under this Act" provided:

"The shares or other interest of any member in a Company under this Act shall be personal Estate, capable of being transferred in any manner provided by the Regulations of the Company, and shall not be of the nature of Real Estate …"

  1. Section 74(1) of the Companies Act 1931 (Qld), under the heading "Transfer of Shares and Debentures, Evidence of Title, etc", provided:

"74.  Nature of Shares

The shares or other interest of any member in a company shall be personal estate, transferable in a manner provided by the articles of the company, and shall not be of the nature of real estate."

  1. This wording is virtually identical to s 73 of the Companies Act 1948 (U.K.) and s 62(2) of the Companies Act 1929 (U.K.).  Section 73 of the 1948 Act was in Part II headed "Share Capital and Debentures".
  1. Section 90 of the Companies Act 1961 (Qld), contained in Division 6, "Title and Transfers", provided:

"90.  Nature of shares

The shares or other interest of any member in a company shall be personal estate, transferable in any manner provided by the articles, and shall not be of the nature of real estate."

  1. Even if, as counsel for the respondents submits, the original purpose of identifying shares and interests in corporations as personal property was to ensure that they were not regarded as real property, it does not follow that interests in companies are, for reasons unexplained, not to be regarded as property at all. Nor, in view of the Legislative history of provisions similar to s 1070A, can the respondents draw much support from the section's location in the Act.
  1. Counsel for the respondents did not dispute that "company" in s 1070A included reference to a company limited by guarantee[18] or that "member" in that section includes reference to a member of a company limited by guarantee.[19]
  1. The respondents' approach to the construction of s 1070A(1), with respect, did not owe a great deal to conventional canons of statutory construction. The sub-section construed literally, states clearly and unequivocally that an "…interest of a member in a company …" has three distinct characteristics. Those characteristics are that it is: (a) personal property; (b) transferable or transmissible to the extent stated; and (c) capable of devolution by will or by operation of law. Characteristic (c) is qualified by s 1070A(2).
  1. The respondents' construction would require s 1070A(1)(a) to be read as if worded, "(a) if property, is personal property".  It is very difficult to see why the Legislature would wish to introduce such an element of uncertainty into a part of a section the purpose of which was to clarify and explain the nature of shares and other interests in a company or registered scheme as well as some of the incidents and rights of ownership of shares and other interests.  It is also difficult to understand why the Legislature would have wished in such a provision to differentiate between companies limited by guarantee, depending on the content of their memoranda and articles of association.  There is nothing, for example, to prevent the articles of Association of a company limited by guarantee providing for distribution of the company's surplus assets to members on a winding up or the assignability of membership interests.  The point being that there can be and are companies limited by guarantee where there can be no doubt that the interests of members are property.
  1. There is nothing in the language of s 1070A(1) which suggests that there is some Legislative purpose which can be met only by giving the provision "a strained construction".[20]  I accept that it would be arguable in the absence of a provision such as s 1070A(1) that the interests in the respondent of the Members would not be regarded as property for the reasons advanced by counsel for the respondents.[21]
  1. But, as the following discussion shows, there is nothing particularly unconventional in regarding interests of the nature of the interests of the Members in the respondent as property and it is not suggested that there are reasons of public policy which would make this approach undesirable. It does not seem to have been thought undesirable by Legislatures in Australia and the United Kingdom for well over one hundred years.
  1. In National Provincial Bank Ltd v Ainsworth[22] Lord Wilberforce said:

"Before a right or an interest can be admitted into the category of property, or of a right affecting property, it must be definable, identifiable by third parties, capable in its nature of assumption by third parties, and have some degree of permanence or stability."

  1. As appears, however, from the reasons of Brennan J in Australian Capital Television Pty Ltd v The Commonwealth[23] and R v Toohey; Ex parte Meneling Station Pty Ltd, referred to earlier, there is no one absolute or unqualified test capable of application in all circumstances.
  1. The following passage from the reasons of McPherson J in Bailey v Uniting Church in Australia Property Trust (Qld)[24] illustrates the breadth of meaning given to the word "property":

"Divorced from the context of taxing statutes, the word property, standing by itself, has been said to 'include property, rights and powers of any description': Nokes v Doncaster Amalgamated Collieries Limited [1940] AC 1015, 1033, per Lord Atkin; and cf O'Brien v Benson's Hosiery (Holdings) Ltd [1980] AC 562.  It includes a claim or right of action:  see Re United Pacific Transport Pty Ltd [1968] Qd R 517, 524-525.  'Property' was long ago said to be 'the most comprehensive of all terms which can be used, inasmuch as it is indicative and descriptive of every possible interest that a party can have:  Jones v Skinner (1836) 5 LJ Ch 90.  Insofar as 'property' includes 'right' … the word 'right' is said to mean 'a capacity residing in one man of controlling, with the assent and assistance of the State, the actions of others".

  1. In their written submissions, counsel for the appellant referred to these reasons of Buss JA, with which Martin CJ agreed, in Secure Parking (WA) Pty Ltd v Wilson:[25]

"Contractual rights and other choses in action may be the subject matter of a trust.  See Lloyd's v Harper (1880) 16 Ch D 290; Harmer v Armstrong [1934] Ch 65.  In Lord Strathcona Steamship Co Ltd v Dominion Coal Co Ltd [1926] AC 108, Lord Shaw, delivering the advice of the Privy Council, said:

'The scope of the trusts recognized in equity is unlimited. There can be a trust of a chattel or of a chose in action, or of a right or obligation under an ordinary legal contract, just as much as a trust of land (124).'

A trust may be created in respect of a contract which is not assignable at law, unless it is prohibited by the terms of the contract. See Don King Productions Inc v Warren [2000] Ch 291, 321 and 335–336.

A trust may be created in respect of a lease over real property (Keech v Sandford (1726) Sel Cas Ch 61) and, more generally, in respect of an equitable interest in real or personal property (Comptroller of Stamps (Victoria) v Howard-Smith (1936) 54 CLR 614 at 621–622)."

  1. Reference was made also to the following passage from Jacobs' Law of Trusts in Australia:[26]

"… In general, all property may be made the subject of a trust unless the policy of the law or statute forbids it.  Even property which is incapable of assignment, such as a contract involving personal skill or confidence, may be held on trust.  The property may be real or personal.  It may be corporeal or incorporeal, tangible or intangible, a chose in possession or a chose in action.  It may be property created by statute."  (footnotes omitted)

  1. That passage was relied on by the appellant before the primary judge who pointed out that it assumed that the right or interest concerned was "property". It is useful, however, as another illustration of the fact that failure to meet one or more of Lord Wilberforce's criteria in Ainsworth does not prevent, necessarily, a chose in action from being regarded as property.
  1. The articles of association of a company have the effect of a contract between the company and each member and between a member and each other member.[27]  The articles contain rights which the Members may vindicate by action or rights and obligations in respect of which the Members may be sued.[28]  These rights are supplemented by statutory rights.  The meaning of "chose in action" is discussed in Halsbury's Laws of England[29] as follows:

"The meaning of the expression 'chose in action' has varied from time to time, but is now used to describe all personal rights of property which can only be claimed or enforced by action, and not by taking physical possession."[30] (footnotes deleted)

  1. The following passage from the reasons of Fry LJ in Colonial Bank v Whinney,[31] although discussing the character of a share, has substantial application to an interest of a member in a company limited by guarantee:

"What, then is the character of a share in a company?  Is it in its nature a chose in possession, or a chose in action? Such a share is, in my opinion, the right to receive certain benefits from a corporation, and to do certain acts as a member of that corporation; and if those benefits be withheld or those acts be obstructed, the only remedy of the owner of the share is by action.  Of the share itself, in my view, there can be no occupation or enjoyment; though of the fruits arising from it there may be occupation, enjoyment and manual possession. Such a share appears to me to be closely akin to a debt, which is one of the most familiar of choses in action; no action is required to obtain the right to the money in the case of the debt, or the right to the dividends or other accruing benefits in the case of the share; but an action is the only means of obtaining the money itself or the other benefits in specie, the right to which is called in one case a debt and in the other case a share.  In the case alike of the debt and of the share, the owner of it has, to use the language of Blackstone, 'a bear [semble bare] right without any occupation or enjoyment.'"

  1. The rights held by each member are substantial when considered in their entirety. There is no prohibition on assignment of members' rights in the articles or against the creation of equitable interests.[32]  It is not uncommon for the articles of association of proprietary companies to have provisions which place substantial restrictions and even prohibitions on share transfers and which require particular classes of shares to be held only by certain persons or certain classes of persons.  For example, in a company used as a joint venture vehicle there is commonly provision that shares of a particular class must be held by a particular co-venturer.  Similar arrangements may be found in family trust companies where the beneficiaries of the trust include members of more than one family.  Some such shares carry no dividend rights or rights to participate in surplus capital on a winding up.  Nevertheless, such shares are regarded as personal property by reason in whole or in part of provisions which have been in companies legislation for generations which state that they have this character.  And I am not aware of any academic, judicial or professional concern that recognising such interests as property, gives, or may give, rise to any practical or theoretical difficulties.
  1. The requirement in the respondent's articles that persons may become Members only if they accept the philosophy of the Society of St Vincent de Paul or the Catholic ethos leaves membership open to millions of people in Australia.  The requirement is far less restrictive or personal than the membership requirements of many proprietary companies.
  1. In the joint judgment in WACB v Minister for Immigration and Multicultural and Indigenous Affairs,[33] their Honours observed that "Gibbs CJ, [in Cooper Brookes (Wollongong) Pty Ltd v Federal Commissioner of Taxation[34]] said that the canons of construction should not be treated so rigidly as to prevent the implementation of a realistic solution in the case of a drafting mistake".  However, it was also remarked that "[Gibbs CJ] went on to say that where the language of a statutory provision is clear and unambiguous … it must be given its ordinary and grammatical meaning."
  1. The primacy of the language of a statute in the determination of its meaning was affirmed in the joint reasons of Hayne, Heydon, Crennan and Kiefel JJ in Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue[35] in which it was said:

"This Court has stated on many occasions that the task of statutory construction must begin with a consideration of the text itself.  Historical considerations and extrinsic materials cannot be relied on to displace the clear meaning of the text.  The language which has actually been employed in the text of legislation is the surest guide to legislative intention.  The meaning of the text may require consideration of the context, which includes the general purpose and policy of a provision, in particular the mischief it is seeking to remedy."  (footnotes deleted)

  1. The joint reasons further warned against concentrating on the legislative purpose at the expense of due consideration of the text:[36]

"Fixing upon the general legislative purpose of raising revenue carried with it the danger that the text did not receive the attention it deserves.  This danger was adverted to by Gleeson CJ in Carr v Western Australia when he said:

'[I]t may be said that the underlying purpose of an Income Tax Assessment Act is to raise revenue for government.  No one would seriously suggest that s 15AA of the Acts Interpretation Act has the result that all federal income tax legislation is to be construed so as to advance that purpose.  Interpretation of income tax legislation commonly raises questions as to how far the legislation goes in pursuit of the purpose of raising revenue.  In some cases, there may be found in the text, or in relevant extrinsic materials, an indication of a more specific purpose which helps to answer the question.  In other cases, there may be no available indication of a more specific purpose.  Ultimately, it is the text, construed according to such principles of interpretation as provide rational assistance in the circumstances of the particular case, that is controlling.'" (footnote deleted)  (emphasis added)

  1. For these reasons I conclude that the primary judge erred in his implicit conclusion that it was not reasonably arguable that the interests of the Members as members of the respondent were properly capable of being held on trust. Senior counsel for the respondents submitted in the course of argument that this Court should not on an appeal from an interlocutory order make a final determination of the point under consideration as if it were a determination of a preliminary or separate issue. Counsel for the appellant did not urge that a different course be taken and I have concluded that it is preferable to err on the side of caution and accede to counsel's request. I should mention that the primary judge's attention was not drawn to s 1070A.

The respondents' criticisms of the pleadings relating to the Members

  1. Counsel for the respondents made the following criticisms of the paragraphs of the pleading relating to the Members. Paragraphs 7 to 11 allege the creation of an express trust. An express inter vivos trust may be created in one of two ways:[37]  by a declaration of trust, or by transfer of property.  In Commissioner of State Revenue v Lam & Kym Pty Ltd,[38] Nettle JA, with whose reasons the other members of the Court agreed, said:

"Each of the texts records that a non-testamentary trust may be created by transferring property to the proposed trustee to hold upon trust for the proposed beneficiary or, without transfer of property, by declaration of trust.  Those methods of creation are mutually exclusive in the sense that one cannot effectually transfer property to another to hold upon trust and at the same time declare that one holds it oneself on trust.  They are also exhaustive because, as the texts make clear, they are the only methods for the inter vivos creation of trusts."

  1. The alleged trusts did not arise on the transfer of property since none of the Members acquired his membership rights in that way. No declaration of trust is expressly pleaded. The signing of the memorandum of association does not amount to a declaration of trust and there is thus an absence of material facts to support the existence of the trust claimed.
  1. Paragraph 12, as the primary judge found, is defective as "simply an assertion of a conclusion to be drawn from facts which are not themselves pleaded".
  1. The constructive trust claimed against the original members in paragraphs 14 and 15 of the pleading is defective as:
  1. No basis for the imposition of a constructive trust is alleged in the pleading;
  1. There is no allegation that the original members received trust property;
  1. There is no allegation that the original members knowingly assisted a breach of trust, the rule in Barnes v Addy is not invoked.
  1. Paragraph 7 erroneously alleges that the appellant had power to authorise the incorporation of the respondent and decided to do so. The power to incorporate lay with ASIC on the application of the corporators and did not lie with the appellant. It is not alleged that the original members acted as agents for the appellant. "This startling error infects the remainder of the pleading …". There is an unstated and unjustified assumption in the pleading that it is sufficient to simply demonstrate a causal link between a breach of trust and the Members becoming members. Something further is required to invoke the rule in Barnes v Addy.  The Members' rights did not exist prior to incorporation.  They were not held on trust before then.  No trust property existed to be "knowingly received".
  1. In Farah Constructions Pty Ltd v Say-Dee Pty Ltd,[39] the following statement was unanimously approved:

"As Street J pointed out in Mayer v Coe ... the proprietary rights of a registered mortgagee of Torrens title land derive ' from the fact of registration and not from an event antecedent thereto'.  In truth, I think it is not possible, consistently with the received principle of indefeasibility as it has been understood since Frazer v Walker and Breskvar v Wall, to treat the holder of a registered mortgage over property that is subject to a trust, registration having been honestly obtained, as having received trust property.  The argument that the appellant is liable as a constructive trustee because it had 'knowingly received' trust property should in my opinion fail."  (footnotes deleted)

  1. Nor can the appellant rely on the second limb of the rule in Barnes v Addy.  There is no allegation of the requisite knowledge against the original members.  It is therefore unnecessary to consider what facts would be necessary to arguably allege a "dishonest and fraudulent design".  The constructive trust alleged in paragraph 16 of the pleading does not arguably found a claim for a constructive trust against the new members.

The submissions of counsel for the appellants on the pleadings

  1. Counsel for the appellant pointed out that although the primary judge held that the interests of members were not property and that "there could be no express trust in relation to members who became members subsequent to incorporation … [on] the facts pleaded in the proposed pleading", it was not decided that the pleading was deficient in relation to the other allegations against the Members. It was further submitted:

"… that paragraphs 7 to 12 of the [pleading] does sufficiently allege an express trust as against those of the [Members] who became members after incorporation of the [respondent].  That is because it is alleged that the … Respondent was incorporated for the purposes of the Rule (paragraph 9 – 10); by article 7.4 of the articles of association the first directors are Messrs Breen, Lenz and Turnbull; by article 3.2(b) the Directors admit additional members; and accordingly, when exercising the power to appoint additional members, and to create new rights of membership, Messrs Breen, Lenz and Turnbull must be presumed to be doing so for the purposes of the Rule, and therefore on terms that the member holds their rights on trust for the purposes of the Rule, alternatively the Appellant (paragraph 13)."

Consideration of the proposed amendments to the pleading

  1. I do not consider that there is any substance in the submission by counsel for the respondents that there is an erroneous assumption in the pleading (paragraphs 7 and 8) that the appellant had power to authorise the incorporation of the first respondent and did so: the power lying with ASIC on the application of the corporators. The allegation in the pleading, reasonably construed, relates to procuring or sanctioning the incorporation of the respondent with a view, inter alia, to the land being transferred to it.
  1. Other criticisms, however, have substance. Senior counsel for the appellant properly conceded that the allegations in paragraph 12 were not supported by pleaded material facts. The pleading does not differentiate between the Members who were signatories to the articles of association and directors when the land was transferred to the respondent and the other members as to the basis on which liability is alleged to exist. Nor is any distinction drawn between those persons who participated in the decision-making processes which led to the transfer of the land and the incorporation of the respondent and those Members who, on the face of things, came on the scene later. Nor is there an allegation that the Members, as Directors of the respondent, have caused and continue to cause it to retain the land and deny the appellant's interest in it. Consequently, the basis on which liability is alleged to exist under the second limb of Barnes v Addy is not clearly expressed.[40]
  1. The defects in the pleading make it inappropriate to give leave for the disputed amendments to be made. The pleading obviously requires further attention. That does not mean, however, that a joinder order should not be made. The proceeding was commenced in June 2006 and in over three years little has been done to get the matter ready for trial. That state of affairs cannot be permitted to continue. The presence before the Court of all Members is "desirable, just and convenient to enable the court to adjudicate effectually and completely on all matters in dispute connected with the proceeding".[41] 
  1. Having regard to the charitable purposes of the appellant and the respondent, it is more than usually desirable that the issues between them be resolved as efficiently, cost-effectively and expeditiously as possible. That end is best served by ordering the joinder now and making further orders with a view to ensuring that if the matter is not settled, it is brought on for trial as quickly as possible. Having regard to the matters alleged in the remaining part of the existing pleading and the factual matters recounted earlier, I consider it unlikely that sustainable claims against the Members will not be pleaded. It is likely also that claims against the initial Members and the respondent will affect the interests of the other Members of the respondent. If, which I think most unlikely, no sustainable cause of action is pleaded against some of the Members, the relevant part of the amended pleading and claim can be struck out. I would expect also that, having regard to the nature of the appellant and first respondent, if their differences cannot be resolved by mediation or otherwise, they would co-operate with a view to ensuring that the real issues in dispute are properly identified and litigated.
  1. There were two applications before the primary judge: one filed 29 October 2008, seeking leave to amend the Claim in terms of "the proposed Amended Claim to be exhibited to an affidavit of John Richard Moore to be sworn and filed". And one filed 3 December 2008, seeking the joinder of the Members as second defendants. I do not understand why there were two applications. The first application was to amend the Claim for purposes including amendments consequential on the joinder of the Members as second defendants. The second application was merely for the joinder, which could have been accommodated in the first application. Neither application sought leave to amend the Statement of Claim. There was no need for any such leave, as a party may amend "as often as necessary" before the filing of the request for trial date.[42]  When the matter came on for hearing, however, leave to amend the Statement of Claim was also sought.
  1. For the above reasons I would order that:

(1)The appeal be allowed;

(2)Paragraphs 5 and 6 of the Order made on 31 March 2009 be set aside;

(3)The persons named in paragraph 1 of the application filed on 3 December 2008 be joined as second defendants in the proceeding;

(4)The costs of and incidental to the application filed 3 December 2008, the hearing in respect of it, and the costs of this appeal be the parties' costs in the proceeding;

(5)The appellant file and serve an amended Statement of Claim within 21 days of today's date;

(6)The respondents file and serve an amended defence or amended defences within 21 days of service on them of the amended Statement of Claim;

(7)Within 28 days of today's date the appellant apply to the supervised case list judge for such orders as the judge may make at his or her discretion with a view to ensuring the mediation of the dispute between the parties, if the judge considers that appropriate, and for the expeditious determination of the proceeding;

(8)Before the hearing of the application referred to in paragraph (7), the legal representatives of the parties confer with a view to: agreeing draft directions for consideration by the supervised case list judge limiting the extent of disclosure and considering whether it would be advantageous for there to be a trial of any separate issues.

  1. There does not appear to be any necessity to interfere with paragraphs 1 to 4 inclusive of the Order. There is no notice of contention in respect of the orders giving leave to amend the proposed Statement of Claim in accordance with the unchallenged parts of the pleading.
  1. CHESTERMAN JA:  I agree with the orders proposed by Muir JA for the reasons given by his Honour.

Footnotes

[1] The Rule of the Society of St Vincent de Paul in Australia (4th ed., 1991) at 64 – 65.

[2] It was the custom for members of the State Council to refer to male members as "brother" and female members as "sister".

[3] Clause 9.1.

[4] Clause 5.3.

[5] Clause 6.1, 6.2 and 7.5.

[6] Official Receiver in Bankruptcy v Schultz (1990) 170 CLR 306 at 312; Tasmanian Seafoods Pty Ltd v Peters [1999] QSC 144 at [28]; Masters v Garcia (2005) 65 NSWLR 92 at 95-96 [4], 113 [68]; Benwine Pty Ltd v Jabetin Pty Ltd; Jabetin v Liquor Administration Board NSW [2004] NSWSC 995 at [58] – [63] per Gzell J (and on appeal) (2005) 63 NSWLR 602.

[7] (1922) 31 CLR 66 at 75.

[8] (7th ed., 2006) at [106].

[9] Masters v Garcia [2006] HCATrans 470 per Callinan J.

[10] (1992) 177 CLR 106 at 165 – 166.

[11] (3rd ed., 1995 -) at [4020].

[12] Burns Philp Trustee Company Limited v Ironside Investments Pty Ltd [1984] 2 Qd R 16 at 19 – 21.

[13] (1893) 5 QLJ 40.

[14] Jack v Smail (1905) 2 CLR 684 at 705 per Griffith CJ; Anthoness v Anderson (1888) 14 VLR 127 at 142; and The Queen v Toohey; Ex parte Meneling Station Pty Ltd (1982) 158 CLR 327 at 343 per Mason J.

[15] Pennington v McGovern (1987) 45 SASR 27 at 31; Fitti v Minister for Primary Industries and Energy (1993) 40 FCR 286 at 291; Pyke v Duncan [1989] VR 149 at 159.

[16] Re Silk (Dec'd) [1976] VR 60 at 63.

[17] (Rev 3rd ed., 2001).

[18] See Corporations Act 2001 (Cth), ss 9, 112(1) and 119.

[19] See Corporations Act 2001 (Cth), ss 9 and 231.

[20] C.f. Newcastle City Council v GIO General Ltd (1997) 191 CLR 85 at 113.

[21] In this regard see Wilcox v Kogarah Golf Club Ltd (1995) 14 ACLC 421.

[22] [1965] AC 1175 at 1247 – 1248.

[23] (1992) 177 CLR 106 at 165 – 166.

[24] [1984] 1 Qd R 42 at 58.

[25] (2008) 38 WAR 350 at 377.

[26] (7th ed., 2006) at [106].

[27] Corporations Law, s 180 (set out in Corporations Act 1989 (Cth), s 82) as at 1 January 1996; Corporations Act 2001 (Cth), s 140 (referring to "constitution" and "replaceable rules") as at 1 January 2006; and see generally, Hickman v Kent or Romney Marsh Sheep-Breeders’ Association [1915] 1 Ch 881.

[28] See e.g. L C B Gower, Principles of Modern Company Law (4th ed., 1979) at 315 – 320.

[29] (Volume 6, 4th ed., 1974) at [1].

[30] For definitions to like effect see Crossley Vaines on Personal Property (5th ed.,1973), 262 – 263 and Torkington v Magee [1902] 2 KB 427 at 430.

[31] (1885) 30 Ch D 261 at 286 – 287 per Fry LJ cited in White v Shortall (2006) 68 NSWLR 650 at 684.

[32] C.f. Edwards v Olsen (1996) 67 SASR 266 and Tasmanian Seafoods Pty Ltd v Peters [1999] QSC 144.

[33] (2004) 210 ALR 190 at 200.

[34] (1981) 147 CLR 297 at 304.

[35] (2009) 239 CLR 27 at 46-47.

[36] (2009) 239 CLR 27 at 47-48.

[37] Halsbury's Laws of Australia (Volume 27: Trade and Commerce to Trusts) at [430-215].

[38] (2004) 10 VR 420 at 431 [41].

[39] (2007) 230 CLR 89 at 170 per Gleeson CJ, Gummow, Callinan, Heydon and Crennan JJ.

[40] See Australian Securities Commission v AS Nominees Ltd (1995) 62 FCR 504 at 522 – 523 for a discussion of the accessorial liability of directors of trustee companies.

[41] Uniform Civil Procedure Rules 1999 (Qld), r 69.

[42] Uniform Civil Procedure Rules 1999 (Qld), r 378.

Close

Editorial Notes

  • Published Case Name:

    St Vincent de Paul Society Qld v Ozcare Ltd & Ors

  • Shortened Case Name:

    St Vincent de Paul Society Qld v Ozcare Ltd

  • Reported Citation:

    [2011] 1 Qd R 47

  • MNC:

    [2009] QCA 335

  • Court:

    QCA

  • Judge(s):

    McMurdo P, Muir JA, Chesterman JA

  • Date:

    30 Oct 2009

Litigation History

EventCitation or FileDateNotes
Primary JudgmentSC5314/06 (No Citation)31 Mar 2009Dutney J.
Appeal Determined (QCA)[2009] QCA 335 [2011] 1 Qd R 4730 Oct 2009Appeal allowed: McMurdo P and Muir and Chesterman JJA.

Appeal Status

Appeal Determined (QCA)

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