FEDERAL COURT OF AUSTRALIA

Stevens v Wintawari Guruma Aboriginal Corporation RNTBC [2016] FCA 149

ORDERS

THE COURT ORDERS THAT:

1.    The parties to discuss and bring forward a minute to give effect to this judgment.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

BARKER J:

1    On 2 April 2015, Ms Tania Stevens and her two brothers, Mr Wayne Stevens and Mr Guiness Stevens, collectively the Stevens, were expelled as members of the Wintawari Guruma Aboriginal Corporation RNTBC by a special resolution of their fellow members passed at an Annual General Meeting (AGM) of the Aboriginal Corporation held that day.

2    The Stevens claim that the special resolution of members was oppressive to them, by denying them procedural fairness in the process of expelling them, and now seek to be reinstated as members of the Aboriginal Corporation, pursuant to s 166-1 of the Corporations (Aboriginal and Torres Strait Islander) Act 2006 (Cth) (CATSI Act).

3    The Aboriginal Corporation rejects the claim of denial of procedural fairness and says, in substance, that the Stevens were treated fairly at all steps of the expulsion process and had every opportunity to address the AGM at which the special resolution was passed, but instead chose to leave the meeting not long before the special resolution was discussed and voted on by members.

4    Apart from seeking reinstatement as members of the Aboriginal Corporation, the Stevens also:

(1)    allege that the conduct of the Board of the Aboriginal Corporation in failing to hold an AGM for at least the period January 2013 until 2 April 2015, and in failing to provide to its directors and members proper information as to its finances, management, audit and like affairs for that same period, was oppressive to one or more members and otherwise in breach of the provisions of the CATSI Act; and

(2)    allege, in substance, that decisions of the Aboriginal Corporation and its subsidiaries must be made according to the traditional decision-making processes of the Eastern Guruma people, of whom they, their family, and members of the Hicks family, Hughes family and Smith-Connors family are, generally speaking, members, and seek an order, under the CATSI Act, providing for the appointment of one or more members of the Stevens family to the Board of the Aboriginal Corporation.

5    The traditional decision-making issue concerning the entitlement of members of the Stevens family to be represented on the Board of the Aboriginal Corporation and certain subsidiaries, is not the subject of determination in this judgment, and, by earlier order of the Court, is to be dealt with at a later date, either at the same time as or following the hearing of a pending interlocutory application in WAD 1 of 2015.

6    In WAD 1 of 2015, filed 6 January 2015, prior to the commencement of this proceeding, the Stevens allege that Mr Glen Camille and Mr Kenzie Smith, two other members who are directors of the Aboriginal Corporation, have breached their duties as directors by establishing four wholly owned corporations pursuant to the Corporations Act 2001 (Cth), and seek a number of remedies designed to prevent Mr Camille and Mr Smith from acting as directors of the Aboriginal Corporation and from managing each of its subsidiaries, as well as an account of profits. By interlocutory application filed 20 April 2015, the Stevens have sought leave pursuant to s 169-1 and s 169-5 of the CATSI Act to bring and continue WAD 1 of 2015 on behalf of the Aboriginal Corporation. At the date of the trial of the present matter, that interlocutory application had yet to be heard and determined.

7    Thus, the primary issue to be resolved in this proceeding at the time of trial was whether the Stevens are entitled to be reinstated as members of the Aboriginal Corporation; secondary issues concerned the other allegations of oppressive conduct referred to at [4(1)] above.

Should the Stevens be reinstated as members?

The Stevens’ submissions

8    In their statement of claim filed 27 July 2015, the Stevens link the impugned special resolution of the Aboriginal Corporation made at the AGM on 2 April 2015, to remove them as members of the Aboriginal Corporation, with their commencement of the proceeding in WAD 1 of 2015 on 6 January 2015 seeking orders against Mr Camille and Mr Smith. In this regard, [13]-[19] of the statement of claim pleads:

13.    On 6 January 2015 Tania Stevens, Wayne Stevens and Guinness Stevens being the First, Second and Third Applicant’s in this proceeding, commenced proceeding number WAD/1 of 2015 in this Honourable Court in which Glen Camille and Kensie Smith were named as respondents (‘the Camille Litigation’).

14.    Glen Camille and Kensie Smith were at all material times directors and members of WGAC. Glenn Camille is the chairperson of WGAC.

15.    In summary the applicants in the Camille Litigation seek:

(a)    declarations and consequential remedies against Glen Camille and Kensie Smith alleging breaches by them of certain duties owed to WGAC pursuant to the CATSI Act and that such breaches were constituted by their conduct and involvement in the establishment and operation of four corporate entities namely:

(i)    Eastern Guruma Administration Pty Ltd;

(ii)    Eastern Guruma Administration Services Pty Ltd;

(iii)    Wintawari Guruma Enterprises;

(iv)    Muntulgura Guruma JV Pty Ltd;

(b)    declarations and consequential remedies against Glen Camille by reason of his having, contrary to the constitution of WGAC, acted as chairperson of WGAC while continuing to perform the role of chief executive officer of WGAC;

(c)    all necessary accounts and enquiries including an account of profits made by the respondents or their associates as a result of the above alleged breaches.

Particulars

Further particulars of the claim are contained in

(a)    the Statement of Claim filed in the Camille Litigation; and

(b)    the 18 February 2015 letter providing the answers of the applicants in the Camille Litigation to the Request for Further and Better particulars by the Respondents in the Camille Litigation dated 6 February 2015.

The Board Meeting of 12 January 2015

16.    The Originating Application and the Statement of Claim in the Camille Litigation were served personally on Kensie Smith on or about 10 January 2015 and on Glen Camille on or about 12 January 2015.

17.    On 12 January 2015 a meeting of directors of WGAC was held at the WGAC offices in Karratha. In the absence of Glen Camille, Kensie Smith, Wayne Stevens and Guinness Stevens, the remaining directors discussed the Camille Litigation and indicated that:

(a)    the Camille Litigation was without foundation and Glen Camille and Kensie Smith have acted properly at all times and in the best interests of WGAC;

(b)    they believed there were personal agendas behind the Camille Litigation and WGAC and the rest of the Eastern Guruma Community need to stand up for what is right and support the directors;

18.    The said remaining directors further expressed the opinion that that:

(a)    the four corporations referred to in the Camille Litigation had been established on the advice of WGAC’s advisers and with the full knowledge of the WGAC Board;

(b)    Glen Camille and Kensie Smith, or their associates have not benefited personally from the establishment of any of the four corporations;

(c)    WGAC has held annual general meetings in accordance with the CATSI Act;

(d)    there were no financial affairs of WGAC to disclose at an AGM as WGAC had not conducted operations in its own right until around 1 August 2014;

(e)    the Camille Litigation could cause significant long term damage to WGAC in the following ways:

(i)    causing unrest and disharmony between members and families of the Eastern Guruma community;

(ii)    causing financial harm and stress to the directors;

(iii)    incurring unnecessary costs for WGAC;

(iv)    discouraging existing directors from nominating for re-election as directors are;

(v)    discouraging other community members from standing for election as directors; and damaging the reputation of WGAC in the general community.

19.    After considering the matters raised in paragraphs 17 and 18 above the remaining directors unanimously resolved as follows:

‘That the Board fully supports the actions of Glen Camille and Kensie Smith over the past two years as directors of the Corporation and is satisfied that they have at all times acted in the best interest of the Corporation.

That the Board would support a members’ resolution “(Members Resolution”) being presented to the next annual general meeting seeking to cancel the membership of Wayne Stevens, Tania Stevens and Guinness Stevens while this Federal Court action against the directors continues. The cancellation of membership is on the grounds that their conduct is detrimental to the interest of the corporation.’

Particulars

    Full particulars of the matters referred to in paragraphs 17 to 19 above are contained in the minutes of the directors meeting of WGAC held on Monday, 12 January 2015.

9    Generally speaking, those factual matters are either not in dispute or are made out by the evidence led at the hearing.

10    The Stevens then allege, at [20]-[21] of the statement of claim, that their removal by the Aboriginal Corporation was in breach of cl 3.7 of the Rule Book of the Aboriginal Corporation (Rule Book) in the following way:

20.    The matters referred to in paragraphs 17 to 19 above whereby those Board members then present at the Board meeting of 12 January 2015 gave indications, expressed opinions and passed resolutions with the intent that the Board would support the proposed Members Resolution constituted the commencement and furtherance of a process to cancel the membership of a member of WGAC without the voting approval of at least 80 percent of the directors of WGAC (the Board’s Removal Proposal’) and, as a consequence, were in breach of clause 3.7 of the Rule Book of WGAC.

21.    As a consequence of the failure as aforesaid to comply with clause 3.7 of the Rule Book the said conduct of the Board referred to in paragraph 20 above was a nullity, of no effect and was otherwise oppressive to the members of WGAC and to the members of the Eastern Guruma People.

Particulars

(a)    No notice or proper notice by way of an agenda or otherwise, advising of the Board’s Removal Proposal was given to Board members in sufficient time or at all prior to the said Board meeting of 12 January 2015 so as to properly notify

(i)    any Board member who did not attend the said Board meeting; or

(ii)    any Board member, including Guinness Stevens, who left the said Board meeting prior to the matters referred to in paragraphs 17 to 19 above being considered at the said Board Meeting

of the said Board’s Removal Proposal.

(b)    No sufficient period of time was given to any Board members present at the said meeting prior to their considering and voting in favour of the Board’s Removal Proposal to allow them to properly consider or obtain legal or other advice regarding

(i)    the matters and allegations and particulars of such matters and allegations as are set out in paragraphs 17 to 19 above;

(ii)    any proposed course of conduct which the Board and any Board member may have open to him or her in voting upon or considering his or her response to the said matters and allegations.

11    This particular complaint, concerning the directors’ failure to act on an 80% vote, was not pursued at the hearing, although it was again raised in the Stevens’ written closing submissions filed after trial on 23 December 2015. The Stevens did not put their case at trial by reference to this 80% rule and so I discount this argument. In any event, as discussed below, I consider it is misconceived as a matter of construction of cl 3.7 of the Rule Book.

12    The Stevens further plead, at [22]-[30]:

22.    In furtherance of the Board’s Removal Proposal the Board caused the preparation and distribution of:

(a)    a notice of a forthcoming AGM of WGAC, dated 27 February 2015 notifying that the AGM of WGAC was to be held at the WGAC office in Karratha on 2 April 2015 at 10 AM; together with

(b)    an accompanying explanatory statement.

23.    The said notice of AGM contained an agenda item 12 headed ‘Member Resolution: Cancellation Of Membership - as set out in the attached Explanatory Statement (for approval as a special resolution). The said Explanatory Statement further stated:

‘The Corporation received notice of a members’ resolution on 24 February 2015. The notice is signed by 44 members of the Corporation and is considered to comply with the requirements of Section 201-45 of the CATSI Act and Rule 4.6 of the Rule Book.

Accordingly the corporation has included the resolution in this notice of meeting for consideration at the annual general meeting. The required notice period for such a resolution is 28 days and this has been met.

Resolution

To consider and, if thought fit, pass the following resolution as a Special

Resolution:

‘That Wayne Stevens, Tania Stevens and Guinness Stevens be removed as members of the Wintawari Guruma Aboriginal Corporation RNTBC for conduct detrimental to the interests of the Corporation.’

Background

The notice of the resolution says that the detail of the conduct considered detrimental to the interest of the Corporation will be provided at the meeting.’

24.    The said Explanatory Statement further indicated that:

(a)    detail of the conduct considered detrimental to the interest of the Corporation will be provided at the meeting; and

(b)    the members proposing the resolution had indicated that they will be providing further information on the reasons for the resolution at the AGM.

(c)    An extract from the minutes of the WGAC Board meeting on 12 January 2015 containing those parts of the board minutes dealing with the matters referred to in paragraphs 17 to 19 above was included in the Explanatory Statement.

25.    By letter of 23 March 2015 the applicants’ solicitor wrote to WGAC contending that:

(a)    the attempt to remove Wayne Stevens, Tania Stevens and Guinness Stevens as members of WGAC was for the improper purpose of supressing their agitation about the lack of disclosure of the affairs of WGAC and its operations over recent years and other issues raised in the Camille Litigation;

(b)    the grounds for any proposed exclusion of Wayne Stevens, Tania Stevens and Guinness Stevens from membership of WGAC and any supporting evidence should be set out in writing and provided to them;

(c)    given the drastic consequences of the resolution being approved, Wayne Stevens, Tania Stevens and Guinness Stevens should be given an appropriate period of time, after receiving such grounds and supporting evidence, to prepare a response and the proposed AGM should be deferred accordingly; and

(d)    material in rebuttal of the proposed exclusion from membership prepared by or on behalf of Wayne Stevens, Tania Stevens and Guinness Stevens should have been included in the notice calling the AGM or otherwise provided to members of WGAC.

26.        By letter of 25 March 2015 to the applicants’ solicitor, WGAC replied to the matters raised in paragraph 22 above contending that:

(a)    the said Members’ Resolution complied with the provisions of the CATSI act and had accordingly been accepted as valid by WGAC;

(b)    it was not a requirement for a member’s resolution to include supporting reasons and the members proposing the resolution had not supplied any such reasons,

(c)    should the resolution be passed, and should Wayne Stevens, Tania Stevens and Guinness Stevens continue to consider that the grounds advanced were inadequate or otherwise consider the cancellation to be inappropriate, then it would be open to them to seek any other remedy to which they consider they are entitled.

27.    By email of 31 March 2015 addressed to Tony Bevan, a director of WGAC, the applicants’ solicitor requested that permission be given to record the AGM as a video on the basis the applicants would keep the recording confidential and provide a copy to Tony Bevan if so requested by him.

28.    By email of 31 March 2015 addressed to the applicants’ solicitor, Tony Bevan, purporting to act on behalf of WGAC, indicated that recording of the AGM by individual members would not be allowed.

29.    The conduct of the Board referred to in paragraphs 22 to 28 above whereby the Board has taken further steps to both deal with, and make ongoing decisions about, the Board’s Removal Proposal constitutes the furtherance of a process to cancel the membership of a member of WGAC without the voting approval of at least 80 percent of the of the directors of WGAC and, as a consequence, was in breach of clause 3.7 of the Rule Book of WGAC.

30.    As a consequence of the failure as aforesaid to comply with clause 3.7 of the Rule Book the said Board’s Removal Proposal was a nullity, and of no effect and was otherwise oppressive to the members of WGAC and to the members of the Eastern Guruma People.

13    At trial, the Board’s conduct was not pressed as the basis of the ‘nullity’ contention. Rather, it was what happened from the time of the circulation of the special resolution of members, up to and including the AGM, and the discussion leading to the vote on the special resolution, that is particularly said to constitute a denial of procedural fairness and consequently be oppressive.

14    As to what occurred at the AGM on 2 April 2015, the Stevens submit that the following account of events should be accepted:

    At the AGM, Mr Tony Bevan (not an Aboriginal person) was elected chair of the AGM.

    The Stevens again requested that permission be given to video record the AGM, but this was again denied. The Stevens left the AGM before the agenda item concerning their expulsion was dealt with.

    When the AGM came to consider the expulsion resolution, Mr Bevan made a statement directing members as to how they should come to a decision on how to vote on the resolution.

    Information was then presented at the AGM in support of the special resolution to expel the Stevens. The information purported to contain reasons in support of the cancellation of the membership of the three applicants. At no time had the Stevens been apprised of that information, which was as follows:

(a)    reasons common to all three:

Disrupting the business of the Corporation

1.    Time & money being spent by WGAC on Federal Court Action commenced by all three members against Glen Camille and Kenzie Smith . Based on the information available to the Board and members the action appears to have no merit. Action is causing unnecessary legal and governance costs to be incurred by WGAC.

2.    Corporation is now being dragged into the dispute - Stevens lawyer has conceded that they did not follow the procedures set out in the CATSI Act and are now seeking leave of the court to bring this action against GC & KS on behalf of WGAC.

3.    Under the dispute resolution procedures in the WGAC Rule Book (Rule 11), WS, TS and GS should have provided the evidence to the members and have the matter considered at a general meeting. Instead they have gone to court and now WGAC are incurring unnecessary costs.

4.    History of personal abuse and intimidation at WGAC meetings by the three individuals has disrupted business of WGAC.

Discouraging members from taking on a Director role

5.    Federal Court Action has highlighted to all current & future Directors that they can be personally liable for their conduct as a Director.

6.    Current Directors are concerned that they may have to appear in court.

Causing stress in the Community

7.    A large number of Elders and their families are talking about leaving the Corporation because of the conduct of these three members.

8.    Actions of these three and their solicitors creating unnecessary stress on individual members and their families.

Damage to the Reputation of WGAC

9.    Federal Court Action is damaging the reputation of the WGAC in the community.

10.    Potential impact on new business opportunities for WGAC.

History of personal abuse and intimidation

11.    Members do feel intimidated by the behaviour and manner in which WS, GS and TS conduct themselves.

(b)    additional reasons specific to Wayne Stevens:

Disrupting the business of the Corporation

1.    WS has not attended the last nine WGAC Board meetings. Meetings have had to be cancelled due to lack of quorum. Last meeting attended was February 2014. He is not fulfilling his duties as a Director.

Mr Bevan noted that not fulfilling his role as a Director is not a reason to cancel his membership, as he can be just removed as a Director.

2.    WS left a RTIO M&L Committee Meeting on 17 July 2013 over concerns regarding other TO family members’ attending. This meant that a quorum was not reached.

Conduct Contrary to being a Director and a Member of WGAC

3.    WS has written to WGAC lawyers stating that EG people have no cultural connection to Satellite Springs and that he and his family are prepared to testify to this in court against EG. The cultural significance of Satellite Springs to the EG People has been discussed and unanimously recognised by the Elders at the last two Elders Meetings.

History of personal abuse and intimidation

4.    WS directed sustained personal abuse at Chairman, Glen Camille, over the phone on 2 September 2014 - heard by Elders and large group of members. WS directed sustained personal abuse at Chairman over the phone on 2 September 2014 - heard by Elders and large group of members.

5.    WS abused Directors & Advisors at a meeting and left the meeting before it started. Meeting on 20 September 2013 at the Ibis Hotel.

(c)    additional reasons specific to Tania Stevens:

Conduct Contrary to being a Director and a Member of WGAC

1.    TS and her family through the Windiwarri Cultural Trust would appear to have received approx $88K from FMG in the period October 2006 to June 2008 for the lease of the facilities at White Quartz Camp. The White Quartz property has been recognised for decades as an Eastern Guruma community asset and as such the community as a whole should have received these funds.

History of personal abuse and intimidation

2.    TS has been abusive at past general meetings - Ibis Styles General Meeting 15 April 2013, Lotteries House AGM 22 February 2012. Had to be prevented from physical violence against a member.

(d)    additional reasons specific to Guiness Stevens:

Disrupting the business of the Corporation

1.    GS has not attended 4 out of the past nine meetings. Meetings have had to be cancelled due to a lack of quorum.

Conduct Contrary to being a Director and a Member of WGAC

2.    GS attended the January & February 2015 Board meetings that discussed and agreed on the cultural significance of Satellite Springs to the EG People. GS has at no time while on the Board express a dissenting view about Satellite Springs.

History of personal abuse and intimidation

3.    GS attacked KS from behind in the WGAC office carpark on 18 February 2014. Left KS with cut to the forehead.

Kenzie Smith advised members that he did not agree with this and requested that this matter not be taken into account in members deliberations.

15    Each special resolution was passed and the Aboriginal Corporation subsequently removed the Stevens’ names from the register of members.

16    Thus, the Stevens say, in their written opening submissions filed 4 December 2015, and counsel’s opening submissions, that the sole issue to be determined is whether the expulsions of the Stevens were oppressive to, unfairly prejudicial to or unfairly discriminatory against one or more of them. While the Stevens more broadly refer to “procedural fairness”, they so do in the context of the power of the Court to grant relief against oppressive conduct under s 166-1 of the CATSI Act, a power which, they observe, is equivalent to that set out in s 232 of the Corporations Act.

17    The Stevens note that the definition of “affairs” found in s 700-1 of the CATSI Act is consonant with that found in s 53 of the Corporations Act. The Stevens also note that one relevant difference between the Corporations Act provisions and those found in the CATSI Act is that, under s166-10(b) of the CATSI Act, a former member is entitled to bring an application seeking relief from oppressive conduct where the application relates to the circumstances in which the person ceased to be a member.

18    The Stevens say fairness is the touchstone for oppression and it is well established that one ought not consider the word “oppressive” in isolation, but instead ask whether objectively, in the eyes of the hypothetical bystander, “there has been unfairness namely conduct that is so unfair that reasonable directors who consider the matter would not have thought the decision fair”. See Morgan v 45 Flers Avenue Pty Ltd (1986) 10 ACLR 692 at 704.

19    The Stevens note that the members’ special resolution said that the conduct that the members were complaining of was that the Stevens had acted to the detriment of the interests of the Aboriginal Corporation, and did not specify in any respect that they had misbehaved. In this regard, the Stevens draw attention to Subdiv 150-C of the CATSI Act, which only allows membership to be cancelled on the grounds that a member has “misbehaved” if the members in a general meeting are satisfied that the member has misbehaved in a manner that has significantly interfered with the operation of the company or company meetings. They say there is no separate ground specified in the CATSI Act of acting to the detriment of the interests of an Aboriginal and Torres Strait Islander (ATSI) corporation.

20    The Stevens further contend that the test of behaving “in a manner that significantly interfered with the operation of the corporation or of corporation meetings”, provided by s 150-35(3), suggests an objective test and a question likely to be different from whether or not a member has acted to the detriment of the corporation.

21    In any event, the Stevens say there is nothing in the text, context or purpose of s 150-35 that indicates an intention to exclude the rules of procedural fairness in connection with the exercise of the power. To the contrary, the power is conditional or should be conditioned by a requirement that procedural fairness be afforded. See Kioa and Others v West and Another (1985) 159 CLR 550 at 584; [1985] HCA 81.

22    As to the purported power under cl 3.7 of the Rule Book to cancel a member’s membership if his or her conduct “is detrimental to the interests of the Corporation”, the Stevens say it is unclear whether the rule seeks to apply any lesser standard than s 150-35 of the CATSI Act, but that any such attempt would be ineffective. The Stevens submit that s 150-35 is not a replaceable rule: it is that section which grants the Aboriginal Corporation the power to expel members, and any purported deviation from the standard of conduct required by it, is repugnant to the CATSI Act and invalid.

23    They submit that only conduct of the type envisaged by s 150-35 is capable of grounding a cancellation of membership and it necessarily follows that cl 3.7 of the Rule Book is also conditioned by a requirement to afford procedural fairness.

24    With regard to the facts of this case, the Stevens submit:

When the facts are considered in totality, it is clear that Tania, Wayne and Guiness:

(a)    were not apprised of the grounds upon which their expulsion was to be urged until the meeting that would decide their fate had begun;

(b)    sought, but were denied, advance notice of the grounds for their proposed expulsion;

(c)    were therefore unable to marshal evidence or otherwise prepare to squarely meet the accusations levelled at them;

(d)    were not afforded any real or substantive opportunity to present arguments in their own defence, let alone an opportunity ‘to say everything that can be said’ in their favour;

(e)    have been deprived of a right both of economic, or at least potential economic, significance and of cultural and personal significance.

25    The Stevens say it was within the power of the directors of the Aboriginal Corporation to avoid each of those results, save for the last one, in that it was manifestly within the power and competence of the directors to ensure that a fair and reasonable process was followed. For example, the early provision of the grounds for expulsion, and any material in support of them, would have significantly enhanced the degree of fairness afforded to the Stevens.

26    The Stevens say that whether they may have achieved a different result in that case is unknown and unknowable. The point is, in circumstances where the process by which they lost important rights was unfair, the process must be considered a nullity.

27    In their written closing submissions after trial, the Stevens made three primary contentions. First, that the CATSI Act sets the standard for membership cancellation and that only conduct of the type stipulated by s 150-35(3) can support the cancellation of a member’s membership of a body incorporated pursuant to the CATSI Act. Consequently, to the extent that cl 3.7 of the Rule Book purports to allow cancellation for conduct “detrimental to the interests of the Corporation”, the rule is repugnant to the CATSI Act and invalid.

28    Secondly, that the conduct alleged, even if proved, did not answer the statutory description of “significant interference” in s 150-35.

29    Thirdly, and this was the principal point upon which counsel for the Stevens opened at trial, that procedural fairness was denied. It is contended that the entire process was unfair, that there was no fault in the Stevens leaving the AGM early, and that there was a failure of the Aboriginal Corporation or the members to apprise the Stevens of the grounds for cancellation in advance of the AGM.

Aboriginal Corporation’s submissions

30    On behalf of the Aboriginal Corporation, it is submitted that on 24 February 2015, it received a members’ resolution signed by 44 members of the Aboriginal Corporation of the same date. The resolution sought the removal of the Stevens in the following terms:

that Wayne Stevens, Tania Stevens and Guinness Stevens be removed as members of WGAC RNTBC for conduct detrimental to the interests of the Corporation.

31    Thus, it says the members’ resolution was not pursued on the basis that the Stevens had “misbehaved”, but only on the ground that their conduct was detrimental to the interests of the Aboriginal Corporation. Accordingly, it is cl 3.7 of the Rule Book that permits removal of a member in this case, and the grounds for cancellation of membership set out in Subdiv 150-C of the CATSI Act are not relevant. In particular, the ground of misbehaviour in s 150-35 that is mentioned by the Stevens, is not relied on and was not relied on by the members in forming the resolution of 24 February 2015, voted on 2 April 2015.

32    The Aboriginal Corporation notes that cl 4.6 of the Rule Book states that members can propose a notice of a members’ resolution and provide it to the Aboriginal Corporation. The notice must set out the resolution in writing and must be signed by the members proposing it. This rule also sets out the number of members required to propose a members’ resolution and states that, for a corporation with 51 members or more, 10% of the members are required to propose the resolution. To this extent, cl 4.6 mirrors s 201-40(4) of the CATSI Act.

33    It also observes that cl 4.6 requires the Aboriginal Corporation to give notice of the proposed members’ resolution to all people entitled to it, pursuant to cl 4.5, and for the Aboriginal Corporation to consider the proposed members’ resolution at the next meeting which is being held at least 28 days after the notice has been sent. These rules mirror s 201-45(1) of the CATSI Act, which states that if a corporation has been given notice of a resolution under s 201-40, the resolution must be considered at the next general meeting that occurs more than 28 days after the notice is given.

34    The Aboriginal Corporation submits that, in accordance with these requirements, it was required to put the members’ resolution to the next general meeting which was being held, which, as it transpired, was the AGM of 2 April 2015.

35    The Aboriginal Corporation notes the members’ resolution was published in the notice of the AGM and explanatory statement dated 27 February 2015, and provided to all members of the Aboriginal Corporation. The members’ resolution stated that “[d]etails of the conduct detrimental to the interests of the Corporation will be provided at the meeting”.

36    The Aboriginal Corporation submits that neither the Rule Book or the CATSI Act require reasons to be provided for a proposed special resolution of members (including a resolution proposing the removal of members) prior to the meeting at which the resolution is to be considered. Consequently, it says, that the notice of the members’ resolution satisfied the Rule Book and the CATSI Act in all respects. It further says the Aboriginal Corporation was obliged to put the members’ resolution to the AGM and to not have done so would have been in breach of cl 4.6 of the Rule Book and s 201-40 of the CATSI Act.

37    The Aboriginal Corporation, so far as the provision of information prior to the AGM is concerned, says:

(1)    the members’ resolution was published in the notice of the AGM and explanatory statement dated 27 February 2015, which was sent to each of the Stevens;

(2)    a copy of the members’ resolution was also sent to the Stevens’ legal representative on 25 March 2015; and

(3)    the Stevens’ legal representative was advised by the Aboriginal Corporation that should any further correspondence be received from the members as to the reasons for the members’ resolution, the Aboriginal Corporation would endeavour to circulate this to all members (including the Stevens), should there be sufficient time to do so before the AGM.

38    With regard to the allegation in the Stevens’ statement of claim, that the conduct of the Aboriginal Corporation in putting the members’ resolution to the AGM constituted a furtherance of a process to cancel membership without the approval of at least 80% of the directors, in breach of cl 3.7 of the Rule Book, in their written opening submissions, the Aboriginal Corporation submitted the allegation was misconceived as the relevant requirement of approval by at least 80% of the directors relates to removal of members by resolution at a directors’ meeting. Even though, as stated above, the Stevens did not run their case at trial on this basis, as discussed below, I consider the Aboriginal Corporation’s submission to be correct in any event. As noted above, I discount the particular submission made in the Stevens’ closing written submissions in this regard because of the way they ran their case at trial.

39    As to the conduct at the AGM, the Aboriginal Corporation submits that it complied with the rules of procedural fairness by ensuring that the Stevens were each given a right to be heard, and in acting fairly and without bias in the conduct of the AGM and in consideration of the members’ resolution.

40    It says, however, having regard to the evidence of Mr Bevan, that each of the Stevens gave up their right to be heard with respect to the resolution by leaving the AGM of their own accord at the point of agenda item 10, when they knew that the resolution was yet to be considered at agenda item 12, and were advised by the chairperson of the AGM to remain at the AGM given that the members’ resolution had yet to be considered. The Aboriginal Corporation denies there is any basis to an allegation that the Stevens left because they did not believe they would be given the opportunity to be heard and there is absolutely no evidence to found that belief.

41    The Aboriginal Corporation says there is nothing in the evidence to justify the walkout by the Stevens, by which they denied themselves the opportunity to be heard on the members’ resolution. Indeed, it says the walkout has all the hallmarks of a premeditated act.

42    The Aboriginal Corporation submits that none of the Stevens were denied a right to be heard by it and that each of the Stevens was:

(1)    present at the AGM from the start of the AGM;

(2)    not prevented from speaking at the AGM generally, or specifically on the members’ resolution;

(3)    given prior notice and knew that the members’ resolution was agenda item 12 of the AGM;

(4)    not prevented from hearing the reasons supporting the members’ resolution presented by the members of the Aboriginal Corporation at the AGM;

(5)    not prevented from responding to the reasons supporting the members’ resolution presented by the members of the Aboriginal Corporation at the AGM, before the members’ resolution was considered and voted upon; and

(6)    not prevented from requesting additional time to respond to the reasons supporting the members’ resolution presented by the members of the Aboriginal Corporation at the AGM, before the members’ resolution was considered and voted upon.

43    The Aboriginal Corporation also says that, had the Stevens remained at the AGM for the consideration of the members’ resolution, they would have been capable of dealing with the reasons advanced for cancellation, and that submission is evidenced by:

(1)    paragraphs 40, 42 and 44 of the statement of claim, in which the Stevens claim that the reasons for cancellation of the membership are not reasonable so as to require or justify their removal on the grounds that their conduct was detrimental to the interests of the Aboriginal Corporation;

(2)    paragraphs 26 and 27 of Tania Stevens’ witness statement, which deals with the reasons advanced for the cancellation of her membership; and

(3)    paragraph 23 of Wayne Stevens’ witness statement, which deals with the reasons advanced for the cancellation of his membership.

44    As to the Stevens’ further claim that the reason why they believed they would not be given an opportunity for a fair hearing was because they had been denied the request to make a video of the AGM proceeding, the Aboriginal Corporation says there is no requirement under the CATSI Act, the Rule Book or any subsidiary laws which requires it to allow video recordings to be made of AGMs or meetings generally, or with respect to meetings of which cancellation of membership was being considered. In effect, the Aboriginal Corporation says nothing can be drawn from its refusal to allow the meeting to be the subject of videotaping.

Consideration

45    The background to all outstanding issues between the parties derives from and includes two determinations of native title made in favour of the Eastern Guruma people under the Native Title Act 1993 (Cth) (NTA) in 2007 and 2012.

46    By WAD 6208 of 1998, Nelson Hughes, P Stevens (deceased) (the father of the Stevens) and Eva Connors, as applicant on behalf of the Eastern Guruma people, sought a determination as to the existence of native title. A first determination was made on 1 March 2007, by consent of the parties, in respect of “Determination Area A”. A second was made on 20 November 2012, again by consent, in respect of “Determination Area B”. The relevant areas are located in the eastern Pilbara region of Western Australia, very generally in the vicinity of the mining town Tom Price. See Hughes (on behalf of the Eastern Guruma People) v State of Western Australia [2007] FCA 365; Hughes on behalf of the Eastern Guruma People (No 2) v State of Western Australia [2012] FCA 1267.

47    Each consent determination identified the “native title holders” as being:

(1)    the descendants of Wirntawari who:

(a)    identify and are identified by other members of the native title holding group as Muntulgura Guruma; and

(b)    have a connection with the land and waters in Determination Area A and Determination Area B, in accordance with the traditional laws acknowledged and the traditional customs observed by the Muntulgara Guruma; and

(2)    the descendants of Jack Smith to whom the Muntulgara Guruma accord the right to exercise rights and interests in Determination Area A and Determination Area B in accordance with the traditional laws acknowledged and traditional customs observed by the Muntulgara Guruma.

(These native title holders often go under the more generic description of the “Eastern Guruma”.)

48    Each consent determination ordered, pursuant to s 56(2) of the NTA, that the Aboriginal Corporation should hold the native title in trust for the native title holders.

49    The Aboriginal Corporation had been formed under the CATSI Act prior to the 2007 determination especially for this purpose.

50    Division 6 of Pt 2 of the NTA deals with the native title functions of a prescribed body corporate (PBC) and the holding of native title in trust. By s 55, if the Federal Court proposes to make an approved determination of native title and the determination is that native title exists at the time of making the determination, the Court must then, or soon after, also make such determinations as are required by s 56, which deals with the holding of native title on trust, and s 57, which deals with the non-trust functions of a PBC.

51    By s 56, the persons proposed to be included as native title holders (which s 56(2)(a) describes as the “common law holders”) must indicate whether the common law holders intend to have the native title held in trust by a PBC. If the common law holders fail to nominate a PBC for this purpose, the Court must determine that the rights and interests are to be held by the common law holders themselves. In other words, unless a PBC is nominated to hold the native title in trust for the native title holders/common law holders, the common law holders will personally hold the native title.

52    If the Court formally determines a corporation to be a PBC under s 56, that corporation will then be registered on the National Native Title Register and will become known as a registered native title body corporate, or RNTBC: see definition of “registered native title body corporate” in s 253 of the NTA. Once it becomes an RNTBC, it must include the words “registered native title body corporate” or the abbreviation “RNTBC” as part of its name, as required by s 85-1(4) of the CATSI Act.

53    If the Court does not make a determination that the native title is to be held in trust by a PBC, the Court, under s 57(2) of the NTA, must still determine which PBC is to carry out the functions of an RNTBC on behalf of the common law holders. That body then acts as an agent or representative of the native title holders for prescribed purposes under the NTA.

54    There are practical advantages in having native title held in trust and managed by a PBC. As Mantziaris C and Martin D, Native Title Corporations: a legal and anthropological analysis (Federation Press, 2000) (Mantziaris & Martin) say, at p 90, the corporate trustee and agency device allows non-native title interests dealing with the group to channel their transactions through a single legal person with perpetual succession. As the authors add:

This is intended to avoid the problem of fixing obligations on the ever-fluctuating membership of a group of natural persons lacking legal personality.

55    As the authors go on reasonably to observe, the legislative framework for native title management “has a simple appearance and a simple purpose, but it has created legal relationships of great complexity”. The present proceeding perhaps tends to illustrate the profundity of that observation made 15 years ago.

56    Section 56(7) of the NTA enables regulations to be made in respect of a PBC’s functions; consultations with, or other roles for, the common law holders; and other matters. Regulation 6 of the Native Title (Prescribed Bodies Corporate) Regulations 1999 (Cth) (PBC Regulations), provides the functions of a PBC acting as a trustee, which include managing the common law holders’ native title rights and interests; consulting with the common law holders; and performing any other function relating to native title as directed by the common law holders.

57    Regulation 8 requires the relevant PBC to consult with and obtain the consent of the common law holders in relation to a range of decisions. If there is a particular process of decision-making that, under traditional laws and customs, must be followed in relation to the giving of consent, then the consent must be given in accordance with that process. Otherwise the consent must be in accordance with a process of decision-making agreed to or adopted by them. (This reflects s 203BC(2) of the NTA.)

58    The combined effect of these various provisions of the NTA concerning a PBC and the PBC Regulations is that, where an RNTBC comes into being, it will have a “rule book” which contains its rules or constitution, its native title objectives and statutory functions.

59    It has been recognised, however, that it may often be more appropriate for a PBC to set up separate legal bodies and structures to undertake other activities, especially commercial activities. If this is done, then it is suggested the PBC is able to focus on carrying out its native title functions and to insulate itself from the risk of financial loss and insolvency. See Australian Government, Office of the Registrar of Indigenous Corporations, A guide to writing good governance rules for prescribed bodies corporate and registered native title bodies corporate (Office of the Registrar of Indigenous Corporations, 2011) p 5 http://www.oric.gov.au/publications/rule-book/guide-writing-good-governance-rules-pbcs-and-rntbcs viewed 19 February 2016 (guide).

60    All this highlights the difference between a PBC acting as a trustee controlled by its members, and circumstances where the native title is in fact held by the determined native title holders who would decide matters directly. As stated in the Guide at p 5, by reference to Mantziaris & Martin, under the general law there are significant legal differences between the duties of a corporation acting as trustee, and a corporation acting as agent or representative. One possible difference is that a trustee has a duty to exercise its own independent judgement in making a decision about matters, whereas an agent may be obliged to follow the instructions of native title holders regardless of its own judgement in the matter.

61    It has also been recognised that the membership rules of a PBC may be fashioned in different ways. As Mantziaris & Martin, Ch 10, discuss, and the Guide from p 7 confirms, one important matter to be decided is whether membership should be open to all native title holders identified in the determination, or whether it should be limited to a smaller number of individuals who are appointed to represent all native title holders.

62    In this regard, the CATSI Act, by s 144-10, provides that directors cannot accept an application for membership unless that person is eligible to be a member. The PBC Regulations, by reg 4(2)(c), currently require all members of a PBC to be native title holders.

63    When it comes to cancellation of membership, s 150-20 of the CATSI Act provides that the directors of an ATSI corporation may cancel a member’s membership if a member is not eligible for membership; has ceased to be eligible; or has not paid membership fees. Before doing so, the directors must give the member notice in writing and provide the member with 14 days to object to the cancellation in writing.

64    Pursuant to s 60-1, s 150-20 is a “replaceable rule”. Section 60-5 provides that a replaceable rule can be modified or replaced by an ASTI corporation’s constitution/rules.

65    Section 150-15(1) confirms that s 150-20 is a replaceable rule that provides a model for the cancellation of membership on the grounds of ineligibility for membership or failure to pay fees. Subsection (2) states that ss 150-25, 150-30 and 150-35 deal with cancellation of membership on the grounds that a member is uncontactable; not an ATSI person; or has misbehaved.

66    Section 150-35 specifically provides for cancellation of membership on the ground that the member has “misbehaved”, and states that the provision applies despite s 150-20 or any provision in an ATSI corporation’s constitution/rules. In other words, s 150-35 is a non-replaceable rule.

67    The manner and circumstances in which a member may have their membership cancelled on the ground that they have misbehaved is further governed by subs (3) of s 150-35, which provides:

The corporation may cancel the membership by special resolution in general meeting if the general meeting is satisfied that member has behaved in a manner that significantly interfered with the operation of a corporation or of corporation meetings.

(Emphasis added.)

68    While the rule expressed in s 150-35 may be non-replaceable, there may, under s 150-20, plainly be other rules providing grounds for cancellation additional to the ground that a person has misbehaved. That the rules may provide both additional grounds for cancellation and indeed different processes for cancellation of membership (subject to the non-replaceable terms of s 150-35 in the case of misbehaviour) is reflected in the Guide, which states at p 10:

You may want to have a different process for dealing with the cancellation of membership. For example, you may want to refer the matter to a meeting of native title holders or elders before any decision made by the directors or before the matter is referred to members at a general meeting. If necessary, you may want to use the corporation’s dispute resolution process.

69    In that regard, s 66-1(3A) of the CATSI Act requires an ATSI corporation’s constitution/rules to provide for the resolution of disputes internal to the operation of the corporation.

70    As to the “removal” of a member of the Aboriginal Corporation, cl 3.7 of the Rule Book provides as follows:

If a member:

•    can’t be contacted for two years

•    misbehaves or his or her conduct is detrimental to the interests of the Corporation

•    is not an Aboriginal or Torres Strait Islander person

•    no longer observes or complies with Law and Customs

the member can only be removed by special resolution at a general meeting. The directors must then send that person a copy of the special resolution at their last known address, as soon as possible after it has been passed.

If a person is not eligible for membership for some other reason, the directors can cancel their membership by passing a resolution at a directors meeting. Before the meeting, directors need to give the member 14 days to object in writing. If the member objects, the directors can’t cancel the membership. The member can only then be removed at a general meeting by resolution.

In deciding to commence cancelling a person’s membership, the directors shall consider the matter in accordance with Law and Customs. The process to cancel membership of a member shall not be commenced unless at least 80% of the directors vote in favour of the decision.

71    By cl 4.6 of the Rule Book, members can propose a notice of a members’ resolution and provide it to the Aboriginal Corporation. The notice must set out the resolution in writing and be signed by the members proposing it. The rule provides that for a corporation with 51 members or more, 10% of the members are required to propose the resolution. To this extent, cl 4.6 mirrors s 201-40(4) of the CATSI Act. In this case, the requisite number of members signed the resolution and the other requirements of cl 4 were met and are not in dispute.

72    Clause 4.6 also requires the Aboriginal Corporation to give notice of the proposed members’ resolution to all people entitled to it, pursuant to cl 4.5, and for the Aboriginal Corporation to consider the proposed members’ resolution at the next meeting which is being held at least 28 days after the notice has been sent. These rules mirror s 201-45(1) of the CATSI Act, which states that if a corporation has been given notice of a resolution under s 201-40, the resolution must be considered at the next general meeting that occurs more than 28 days after the notice is given. These requirements of the Rule Book were also met in this case.

73    Clause 3.7, save as to the misbehaviour ground, appears therefore to be a rule concerning cancellation of membership (or expulsion) that replaces the rules otherwise to be found in ss 150-20, 150-25 and 150-30 of the CATSI Act. While the second paragraph of cl 3.7 of the Rule Book refers to a person not being “eligible for membership for some other reason”, the rules do not appear to specify any other reason why a person is not eligible for membership.

74    In those circumstances, in my view, the directors do not have any power to cancel membership under the Rule Book and do not initiate the expulsion process, save for giving notice to members of a special members’ resolution when properly given to the Aboriginal Corporation: only the members by special resolution at a general meeting can cancel a member’s membership, save for the application of s 150-35 of the CATSI Act, which is consonant with this process in any event. As it transpires, the expulsion of a member for misbehaviour under s 150-35 also requires a special resolution at a general meeting, so there is effectively only one means of expelling a member: by special resolution at a general meeting.

75    A question arises as to whether the grounds upon which a member may have their membership cancelled or be removed or expelled from the Aboriginal Corporation include the separate and distinct ground that their “conduct is detrimental to the interests of the Corporation”, which appears to be a separate ground in the second bullet point of cl 3.7 of the Rule Book.

76    The Stevens contend that the second bullet point, which reads in full, “misbehaves or his or her conduct is detrimental to the interests of the Corporation”, should effectively be read as one and the same ground for expulsion, being that which appears in s 150-35(3) of the CATSI Act. In my view, that submission should not be accepted. The ground expressed in that bullet point plainly is drafted in a disjunctive way so that a member might be expelled if he or she “misbehaves” or “his or her conduct is detrimental to the interests of the Corporation”.

77    I accept the submissions made on behalf of the Aboriginal Corporation that the ground of conduct detrimental to the interests of an entity is not an unusual ground. It plainly is wider than mere misbehaviour, as defined in s 150-35. It is, it must be said, rather general in nature, in that the concept of conduct being “detrimental to the interests” of an ATSI corporation leaves much scope for complaint. Nonetheless, it is not so vague or incapable of application as to leap to the view that it is mere dross that purports to further explicate the word “misbehaves” in the first part of that bullet point.

78    In this case, therefore, the special resolution proposed by the requisite number of members that went forward to the AGM of 2 April 2015, did not allege that any of the Stevens had misbehaved in the way defined in the CATSI Act, but rather that they had engaged in conduct that was “detrimental to the interests of the Corporation”.

79    As explained above, there is, in my view, no reason why such a ground for expulsion cannot be included in the constitution/rules of an ATSI corporation under the CATSI Act.

80    I should also confirm what has been stated above, that under cl 3.7 of the Rule Book, the process for expulsion is commenced by a special resolution proposed by the requisite number of members, as contended for by the Aboriginal Corporation. In that regard, the last paragraph of cl 3.7, which refers to the process to cancel membership of a member not being commenced unless at least 80% of the directors vote in favour of the decision, is not relevant to this process. It is only relevant to a process where there is power in the directors to cancel membership, as anticipated by the second paragraph of cl 3.7, even though, as stated above, there appear to be no other reasons which enable the directors to initiate that cancellation process.

81    Consequently, a member may have their membership cancelled on the ground that their “conduct is detrimental to the interests of the Corporation” and may only be removed by special resolution at a general meeting. In my view, however, for the process by which such a special resolution is passed to be effective, the member affected must be adequately advised of the basis upon which the general meeting will be invited to resolve that their conduct is “detrimental to the interests of the Corporation”.

82    In that regard, I accept the Stevens’ submission that the CATSI Act, by ss 166-1 and 166-5, empower the Court to grant relief for oppressive conduct and that a denial of procedural fairness in the course of cancelling membership might be considered an instance of statutory oppression.

83    In that regard, by s 166-10(b) of the CATSI Act, a former member is expressly empowered to bring an application seeking relief from oppressive conduct where the application relates to the circumstances in which the member ceased to be a member.

84    In my view, there were, as the Stevens submit, a number of procedurally unfair aspects of the process by which the cancellations in this case were brought about.

85    While the initial resolution of the Board of the Aboriginal Corporation to support any special resolution without hearing from the Stevens is not of particular significance, it is of significance that, following the circulation of the special resolution, the grounds in support of the motion were not revealed in any detail until the AGM. These grounds were numerous and contained many allegations, some dating from as early as 2006.

86    Any member who is the subject of a special resolution to expel them, or, in the language of the Rule Book, to cancel their membership, is entitled to know in advance of the meeting at which their expulsion is to be considered and voted upon, on what basis the special resolution is proposed.

87    Additionally, the notice of the grounds of the proposed resolution need to be given to an affected member sufficiently in advance of the meeting, having regard to the nature of the issues raised, to permit the member to respond to the issues, allegations and other matters to be considered.

88    In the circumstances of the special resolution passed 2 April 2015, there was plainly considerable ill feeling between the Stevens and a number of other members of the Aboriginal Corporation, including Mr Camille and Mr Smith, who were the subject of the Stevens’ proceeding WAD 1 of 2015, commenced in January 2015, and the Stevens may reasonably have anticipated that the commencement of that proceeding would figure amongst the complaints to support the resolution that their conduct was “detrimental to the interests of the Corporation”. A member should nonetheless not have to rely on guesswork in order to prepare to respond to or rebut any issues, allegations or matters to be the subject of consideration at a general meeting before a proposed special resolution is voted upon by members.

89    There are many circumstances in voluntary associations and a range of other organisations where courts have granted relief against the procedurally unfair expulsion of a member. For example, in John Richard Bryant v Hawkesbury Radio Communication Co-operative Society Limited [2014] NSWSC 848, a member of a community radio station was expelled at a special general meeting. The plaintiff was said to have been involved in “extensive and acrimonious disputes” with the Board. Under the community radio station’s rules, a member could be expelled by a general meeting for “conduct detrimental to the Co-operative”. A resolution to that effect concerning the plaintiff was placed on a notice of special general meeting. The plaintiff’s solicitors complained that no particulars had been provided and requested a deferral of the resolution until such time as they had been. The day before the meeting, the plaintiff was provided with a letter that purported to particularise the matters to be acted upon in support of the resolution. He did not speak at the meeting; rather he sought to circulate a document that made various complaints, including as to the process. There was debate about whether or not he could record the meeting.

90    As to what procedural fairness required in the circumstances, the Court, at [48]-[56], said as follows:

48    On the third point, a reasonable opportunity to be heard involves the right to present arguments in one’s defence. This necessarily involves having a fair opportunity to know and consider what is alleged: Hall v NSW Trotting Club [1977] 1 NSWLR 378.

49    In Kioa v West (1985) 159 CLR 550, at 584-585 Mason J said:

The law has now developed to a point where it may be accepted that there is a common law duty to act fairly, in the sense of according procedural fairness, in the making of administrative decisions which affect rights, interests and legitimate expectations, subject only to the clear manifestation of a contrary statutory intention. ...

The critical question in most cases is not whether the principles of natural justice apply. It is: what does the duty to act fairly require in the circumstances of the particular case? ...

In this respect the expression ‘procedural fairness’ more aptly conveys the notion of a flexible obligation to adopt fair procedures which are appropriate and adapted to the circumstances of the particular case. The statutory power must be exercised fairly, i.e, in accordance with procedures that are fair to the individual considered in the light of the statutory requirements, the interests of the individual and the interests and purposes, whether public or private, which the statute seeks to advance or protect or permits to be taken into account as legitimate considerations.

[Emphasis in original.]

50    In examining procedural fairness, one must also bear in mind the comments of Gleeson CJ in Re Minister for Immigration and Multicultural Affairs; Ex parte Lam (2003) 214 CLR 1 where, in discussing the manner in which procedural fairness cases are approached by the courts, His Honour observed at [37] that:

Fairness is not an abstract concept. It is essentially practical. Whether one talks in terms of procedural fairness or natural justice, the concern of the law is to avoid practical injustice.

51    It has been said that natural justice makes two demands before a person’s legal rights are adversely affected or their ‘legitimate expectations dashed’. First, an opportunity to show why adverse action should not be taken which must involve a sufficient opportunity to say everything that can be said in the person’s favour; and secondly that the matter will be determined by a decision maker whose mind is open to persuasion or free from bias.

52    If there has been a denial of natural justice this will amount to an error of law that deprives a tribunal or the decision maker of jurisdiction and renders the decision void.

53    It is immaterial to pose the question whether observance of natural justice would have produced a different result. It is not the function of the court when such application is made to try the merits of the decision. In a case such as this where a person may be expelled from the co-operative it is plain, notwithstanding the consensual rules of such a body, that the principles of natural justice will clearly apply.

54    Of course in the case of a body such as a co-operative procedures have to be honed and/or followed so that for example where the expulsion is or is not going to be the subject of debate at a special general meeting it is essential that there be a level playing field between all participants. That is, the accuser needs to articulate the conduct that it says warrants expulsion but it is plain that the accused must ordinarily be given a full and adequate opportunity to defend his or her position.

55    It goes without saying that the person accused must know before the hearing and in sufficient detail the issues to be canvassed. That person must be told precisely when and where the hearing will take place and importantly have sufficient time to make enquiries and consider their position and prepare a response.

56    Proper notice has to be given ‘not at the steps of the hearing room but in such time as would enable the person to reasonably and effectually prepare any case which he would seek to make’: Re Mullen [1995] 2 Qd R 608 at 614. In any case involving some form of disciplinary action there must effectively be a charge alleging some act or omission defined in the Rules as misconduct and with which the nominated entity is authorised to deal. It is certainly not necessary for the notice to recite the Rules verbatim provided it is plain enough what rule is relied upon and a copy of it is reasonably accessible especially to the person accused: Byrne v Auckland Irish Society Inc [1979] 1 NZLR 351 at 358.

91    In that case, the Court held that the plaintiff had not been afforded procedural fairness and was entitled to the declaratory relief that he sought.

92    In my view, the principles and observations set out in that decision are generally relevant in this proceeding. While some of the authorities relied on dealt with the question of procedural fairness in a particular statutory or public law context, the substance of those principles, in my view, is relevant to a consideration of whether a member has been subject to oppressive conduct in the course of being expelled from the Aboriginal Corporation.

93    I accept the submissions made on behalf of the Stevens that:

(1)    They sought but were denied advanced notice of the grounds for their proposed expulsion.

(2)    They were therefore unable to marshal evidence or otherwise prepare to squarely meet the accusations levelled against them.

(3)    They were not afforded any real or substantive opportunity to present arguments in their own defence, let alone an opportunity to say everything that could be said in their favour.

(4)    They were deprived of a right of both cultural and personal significance.

94    I do not consider, however, that there was any denial of procedural fairness simply because they were not permitted to make an audio or audio visual recording of the proceedings.

95    Nor do I consider that, in all of the circumstances, the walkout of each of the Stevens at the AGM is relevant to the question of procedural fairness. It is no doubt true that, if the Stevens had stayed to hear what was being said, they would have learnt more about the issues, allegations and other matters raised against them, and they could have possibly addressed the meeting about some of these things. But to state this is merely to highlight the inadequacy of the process leading up to the AGM: the Stevens were learning precisely what was being put against them at the AGM just before a vote was to be taken, and if they had stayed and sought to respond to those issues, allegations and matters, they would not necessarily have had an adequate opportunity to respond to or refute them.

96    This is the whole point of procedural fairness, namely, that a person whose interests may be adversely affected by a decision has a reasonable opportunity to deal with the allegations made against them. As observed in the dicta cited above, procedural fairness is essentially a practical issue. What procedural fairness requires in any case depends on the circumstances of the case, the nature of the allegations made and what would appear, in all the circumstances, to be reasonably required to enable a person to deal with them. In some circumstances, there would not be any procedural unfairness if issues were raised for the first time at a meeting at which a special resolution was considered, so long as the meeting were then to be adjourned or in fact adjourned to accord the affected member the opportunity to return at a later date, at an appropriate time, to respond to the issues raised. But there was never any suggestion that was to occur in this case. The vote plainly was expected to be taken at the AGM, and was then taken. In this case, the Stevens were, in substance, expected to defend themselves in relation to the matters raised at the AGM, while they were at the AGM.

97    As noted above, while the Stevens no doubt could have anticipated that a range of issues might be raised against them as a result of their commencement of WAD 1 of 2015 and because of their own awareness of controversy over other matters, such as the Satellite Springs dispute, guesswork on behalf of an affected person is no substitute for a proper statement, by those propounding a special resolution, as to what actuates the motion.

98    In the result, I consider the Stevens were denied procedural fairness with the consequence that each of their memberships were cancelled by the special resolution of the AGM that was, in the circumstances, oppressive to each of them.

99    It is not necessary to rule on the proposition put on behalf of the Stevens that the conduct alleged against them at the AGM, even if proved, did not answer the statutory description of misbehaviour, for the reason that I do not consider that the special resolution was proposed on the misbehaviour ground.

Should relief be granted in respect of the other allegations of oppressive conduct?

100    As set out in [4(1)] above, the Stevens also allege other instances of oppressive conduct concerning the Board of the Aboriginal Corporation’s failure to hold an AGM for at least the period January 2013 until 2 April 2015, and in failing to provide to the Aboriginal Corporation’s directors and members proper information as to its finances, management, audit and like affairs for the same period.

101    Prior to the trial of the expulsion issue, I made case management orders which, as explained above, resulted in the traditional decision-making issue identified at [4(2)] above, being heard at a later date with or at the same time as matters arising in WAD 1 of 2015. Otherwise the issues raised by WAD 374 of 2015, including those mentioned at [4(1)] above, were to go to trial at the same time as the expulsion issue.

102    I accept the submissions made on behalf of the Aboriginal Corporation that there is no relevant evidence led of oppressive conduct in relation to those other allegations and, to that extent, the claim to relief on those alleged grounds should be dismissed.

Conclusion and Orders

103    For the reasons given above, the Stevens are entitled to relief against their expulsion. On the face of it, they are entitled to declarations that the purported cancellation of each of their memberships of the Aboriginal Corporation was invalid and had no force or effect; orders directing the Aboriginal Corporation to take all steps necessary forthwith to restore each of them to the register of members maintained by the Office of the Registrar of Indigenous Corporations; as well as costs. I will hear from the parties as to the appropriate terms of the relief to be granted.

Associate:

Dated:    26 February 2016

SCHEDULE OF PARTIES