Gould v Isis Club Incorporated

McMeekin J

28 August 2015

In this matter, the applicant’s membership of the respondent association – a social club incorporated under the Associations Incorporation Act 1981 [4] – had been terminated following her alleged breach of its rules. The issue before his Honour was whether there had been a breach of natural justice effectively negating that decision.

In addressing whether the respondent’s decision should be set aside, his Honour observed that s 71(3) of the Act required that, as an incorporated association, the respondent follow the rules of natural justice in adjudicating upon the rights of its members as conferred by its rules. [5]. He also noted that the rules themselves dictated that prior to the termination of a member’s membership, the member be given “a full and fair opportunity to show why the membership should not be terminated”. [8].

The requirements of natural justice are not inflexible but depend on “the circumstances of the case, the nature of the inquiry, the rules under which the tribunal is acting, the subject matter that is being dealt with and so forth”: see Russell v Duke of Norfolk [1949] 1 All ER 109 at 118 per Tucker LJ quoted in Ex Parte Angliss Group (1969) 122 CLR 546 at 552; 43 ALJR 150 at 151; and Kioa v West (1985) 159 CLR 550 at 563 per Gibbs CJ, 594 per Wilson J, 612–615 per Brennan J. Whilst social clubs are still bound by the rules, they are somewhat relaxed: see Australian Workers’ Union v Bowen (No 2) (1948) 77 CLR 601 at 628. However, that is not to say that the fundamental rules – such as accessibility to a fair hearing – are able to be disregarded by such entities: see Hall v The NSW Trotting Club Limited [1997] 1 NSWLR 378. [12].

In examining the factual background to the matter, his Honour noted that the applicant had been a participating member of the respondent club since 2011. In October 2014 a new management committee was elected. [17]. On 15 February 2015 that committee decided to terminate the applicant’s membership, [18] due to alleged “injurious and prejudicial” behaviour and conduct. [19]. The various correspondence between the parties indicated that the management committee consequently banned her from entering the club premises. The applicant stated that she was the only person in the district who had been so banned or had their membership terminated, and stated that these actions caused her personal and professional detriment. [32].

The applicant’s central complaints were threefold:

• There was an apprehension of bias, based on the language and tone of the letters of 20 February and 25 March, suggesting that the committee had pre-judged the matter;
• That correspondence “failed to identify the critical issues and to contain sufficient information to enable her to properly respond to the allegations”;
• That insufficient time was allowed to allow her to properly and adequately prepare her defence to the charges outlined. [35].

Adequate Notice

His Honour identified “several difficulties with the processes” adopted by the management committee [37] from an adequate notice perspective. The applicant was not afforded any proper notice of the charge against her [38] and the letter advising her that she had until 31 March 2015 to demonstrate why her membership should not be terminated was lacking in detail. [38]. His Honour took the view that she had been left “in the dark and could make no meaningful response” [40] in circumstances where she was not fully informed as to the precise allegations. [48].

Time to Respond

His Honour also noted that the applicant had been given a very short period of time within which to prepare her defence: an initial six weeks, but then a mere six days to meet further detailed allegations. In his view, six days was “far too short a period to enable any meaningful defence to be raised to the allegations” [52] and it was “simply unfair” to expect her to. [54].

Apparent Bias

With regards to the issue of apparent bias, his Honour stressed that it is fundamentally important to keep an open mind until a defence is heard. [61]. Whilst recognising the difficult position the committee found itself in, of being both prosecutor and judge [62], in applying the test in Laws v Australian Broadcasting Tribunal (1990) 170 CLR 70 he found that the relevant determination in the matter preceded hearing from the defence, since the committee stated that they felt “compelled” to terminate the applicant’s membership. [63]. In his Honour’s view, doing so prior to the defence case being heard “indicates pre-judgement that is the very antithesis of affording natural justice”. [63].

Conclusion

After viewing the decision-making process in its entirety and not being satisfied that the requirements of natural justice were met, his Honour declared that the decision of the committee terminating Ms Gould’s membership was void and ordered that it be set aside. He ordered that the respondent pay the applicant’s costs. [78].