SIMISTER v TAURANGA CRUISE TOURISM OPERATORS ASSOCIATION INC [2015] NZHC 1852 [6 August 2015]

SIMISTER v TAURANGA CRUISE TOURISM OPERATORS ASSOCIATION INC [2015] NZHC 1852 [6 August 2015]IN THE HIGH COURT OF NEW ZEALANDTAURANGA REGISTRYCIV-2015-470-000036[2015] NZHC 1852IN THE MATTER of the Judicature Amendment Act 1972and Part 30 of the High Court RulesANDIN THE MATTER of an application for judicial reviewBETWEEN ROGER ALAN SIMISTERPlaintiffAND TAURANGA CRUISE TOURISMOPERATORS ASSOCIATIONINCORPORATEDDefendantHearing: 21, 22 July 2015Appearances: T J Castle and T A Castle for PlaintiffG A Mathieson and K J Jordan for DefendantJudgment: 6 August 2015(RESERVED) JUDGMENT OF ANDREWS JThis judgment is delivered by me on 6 August 2015 at 4 pmpursuant to r 11.5 of the High Court Rules......................................................Registrar / Deputy RegistrarContentsIntroduction .......................................................................................................... [1]Background ........................................................................................................... [3]Application for judicial review .......................................................................... [19]Natural justice principles .................................................................................. [23]Should a lesser standard of natural justice be applied to TCTOA? .............. [24]Evidence .............................................................................................................. [32]Analysis: introduction ........................................................................................ [34]The warning ........................................................................................................ [35]Submissions ................................................................................................ [39]Discussion .................................................................................................. [43]Incident on 3 December 2014 ............................................................................ [49]Executive's notice ............................................................................................... [53]Solicitor's letter of 17 December 2014 .............................................................. [58]Alleged further breach before termination ...................................................... [60]The termination decisionSubmissions ................................................................................................ [62]Discussion .................................................................................................. [65]The termination notice ....................................................................................... [69]Breaches of the TBoP code ................................................................................ [73]Mr Simister's letter of explanation ................................................................... [76]The appeal meeting ............................................................................................ [77]Submissions ................................................................................................ [79]Discussion .................................................................................................. [88]Conclusion as to claims of breaches of natural justice ................................... [98]Relief .................................................................................................................... [99]Submissions .............................................................................................. [100]Discussion ................................................................................................ [103]Conclusion as to application for judicial review ........................................... [108]Breach of contract ............................................................................................ [109]Costs .................................................................................................................. [112]Introduction[1] In this proceeding for judicial review the plaintiff, Mr Simister, alleges that the defendant, Tauranga Cruise Tour Operators Association Inc ("TCTOA") was in breach of the rules of natural justice when it terminated his membership of TCTOA. Mr Simister further alleges that TCTOA was in breach of contract. By way of relief, he claims orders quashing decisions made concerning his membership, and a declaration that TCTOA's rules governing termination of membership breached theprinciples of natural justice and should be re-drafted. On his cause of action for breach of contract, Mr Simister claims compensation for financial losses arising from the breach in respect of his direct loss of earnings and general damages.[2] The allegations are denied by TCTOA. TCTOA says that Mr Simister'smembership was terminated because he broke the rules.Background[3] The Port of Tauranga receives visits from more than 80 cruise ships during each cruise ship season (October – May). Passengers on cruise ships may purchase tours through an "ITicket" and "IPort" facility under the auspices of Tourism Bay ofPlenty ("TBoP"). A tour operator wishing to access the IPort facility must be a party to an Operator Agency Agreement ("operator agreement") with TBoP. One ofthe requirements for entering into an operator agreement with TBoP is that the tour operator is a current member of TCTOA.[4] Both TCTOA and TBoP have rules and codes of conduct with which members of TCTOA, and those having operator agreements with TBoP, must comply. These will be referred to as the "TCTOA rules", "TCTOA code", and "TBoP code".[5] TCTOA was formed as an unincorporated association during 2008. It was registered as an incorporated society in May 2014. As set out in its rules, TCTOA's purposes are "to facilitate the provision of first class tourism services to visitors to Tauranga and the Bay of Plenty", and to represent the interests of independent tour operators with a number of entities, including cruise ship operators, TBoP, Port ofTauranga, Tauranga City Council, and New Zealand Transport Agency. As at the date of hearing, TCTOA had 27 members, whose annual membership fee was $40. It had an executive comprising six members.[6] The rules of TCTOA include, at r 14, provisions relating to "cessation"(termination) of membership. These include a right to appeal against a termination decision to a meeting of the full TCTOA association.[7] Mr Simister is a tour operator, trading as Arrow Tours. He became a member of TCTOA in October 2013, prior to its incorporation, and continued as a member after incorporation. While he operates a business website on which bookings can be made, and advertises locally, the majority of his clientele has come from TBoP'sIPort facility.[8] Much of the controversy between the parties focuses on the procedure followed when a cruise ship is at the Port of Tauranga, and members of TCTOA wish to take passengers on tours that have been booked through the IPort facility. For those members wishing to use the IPort facility, the procedure (as set out in the TBoP and TCTOA codes) is as follows:(a) Prior to 5 pm on the day prior to the arrival of the cruise ship, a tour operator must complete and send its available inventory form to TBoP (TBoP code, 7.3).(b) A draw is made each cruise day at 7.30 am. This sets the order inwhich the fleet of operators' vehicles move to the port after the draw,and the order of parking at the Mount Ocean Sports Club (MOSC) car park (TCTOA code, Standard Operating Procedures for MOSC car park, 1).(c) If an operator has more than one vehicle, only one vehicle may be in the first draw; the second vehicle will be in the second draw (TCTOA code, Standard Operating Procedures for MOSC car park, 2).(d) Operators must comply with all parking instructions and directions given by Tauranga City Council parking wardens (TBoP code, 5.1)(e) All drivers must remain with their vehicles at all times and receive their bookings/ticketing communications from the TBoP co-ordinator on duty (TBoP code, 5.2)[9] It is evident from the fact that both TCTOA and TBoP have rules surrounding the use of the IPort facility, and matters such as car parking in the Tauranga Port area, that use of the IPort facility is valued by tour operators, and that TCTOA considers it appropriate to manage the use of car park spaces at or near the port. Members of TCTOA may opt not to use the IPort facility, if they have pre-booked tours. If that is the case, they are not required to take part in the draw, and they do not park in the area used by operators using the IPort facility.[10] On 19 November 2014 the then chairman of TCTOA, Mr Bruce Remnant,emailed a "first and final warning" to Mr Simister. I shall refer to this email as "the warning". In his evidence, Mr Remnant said that the warning was sent following "a meeting held in the MOSC car park and by phone", at which it was decided to sendMr Simister a written warning. The warning set out eight alleged breaches of TCTOA's code of conduct, and stated that if the behaviour did not stop, TCTOAwould activate the process to terminate Mr Simister's membership.[11] On 8 December 2014, Mr Simister received a further email from Mr Remnant, on behalf of the executive. This set out a further alleged breach of the code of conduct, said to have occurred on 3 December 2014, and required Mr Simister to give reasons why his membership of TCTOA should not be terminated. I shall refer to this email as "the executive's notice".[12] On 17 December 2014, Mr Simister's solicitors wrote to the solicitors for TCTOA, confirming that they had that week been instructed by Mr Simister. They said they would be meeting with him to obtain full instructions. The solicitors further said they would not be able to respond to TCTOA until the week beginning12 January 2015. The solicitors also suggested, as "a pragmatic approach", ameeting between the parties, and invited TCTOA's solicitors to take instructions onthat point. The letter concluded:In view of further time being required for due process to be followed, our client will continue to operate as per his current terms and conditions of membership and instructs us he will operate within the Rules of the Association and the Code of Conduct.[13] TCTOA's solicitors forwarded the letter to the executive, but did not respond to Mr Simister's solicitors.[14] On 18 December 2014, Mr Remnant sent an email to the executive members, recommending that unless they had good reason in writing before 22 December, theycancel Mr Simister's membership. All of the executive members responded by 19 December, agreeing with Mr Remnant's recommendation. On 23 December 2014, all executive members voted by email to terminate Mr Simister's membership ofTCTOA.[15] Mr Simister was not told of the termination until 12 January 2015 when he was told by way of a notice sent under cover of a letter from TCTO's solicitors to his solicitors. I shall refer to this letter as "the termination notice". The letter referred toMr Simister's "failure to respond to" the executive's notice as "yet another example of his flagrant abuse of the rules of" TCTOA. It also referred to "further incidences"alleged to have occurred after the executive's notice. The letter concluded by referring to Mr Simister's right to appeal against the termination within 14 days.[16] On the same day (but apparently independently of TCTOA's decision toterminate his membership), Mr Simister was suspended by TBoP for five consecutive cruise ship days, as from 12 January 2015, for breaches of the TBoP code. His tour products were not to be sold through the IPort facility during the suspension period.[17] Mr Simister met with TBoP on the morning of 2 February 2015. The outcome of that meeting was that TBoP was happy to lift the suspension, subject toMr Simister's membership of TCTOA being reinstated.[18] Mr Simister appealed against the termination of his membership. The appeal was dealt with at a meeting of TCTOA on the evening of 2 February 2015 ("the appeal meeting"). Mr Simister was accompanied by his solicitor, and TCTOA'ssolicitors were present. Members voted to uphold the termination.Application for judicial review[19] Mr Simister applied for judicial review of each of the executive's decision toissue the warning, the executive's decision to terminate his membership, andTCTOA's decision to uphold the termination.[20] On his behalf, it was submitted that each decision was made in breach of the rules of natural justice; in particular that Mr Simister was not fully informed of the complaints against him, he was not given any, or any proper, opportunity to respond or to be heard, that in making the decisions, the decision-makers took into account irrelevant considerations, that the appeal process was flawed, that decisions were pre-determined, and that there was apparent (if not actual) bias against him.[21] It was submitted for TCTOA that the application for judicial review should be dismissed. It was submitted that proper procedures were followed, that Mr Simister was properly informed of complaints, and had opportunities to respond. It was further submitted that there was no apparent or real bias, and that the appeal meeting was conducted in accordance with the rules of TCTOA.[22] It was further submitted that in considering the issue of natural justice, it is important to bear in mind the nature and size of TCTOA, and to apply an appropriate standard of natural justice. Finally, it was submitted that even if the Court were to conclude that there had been a breach, no relief should be granted, as the outcome of the process (if repeated) would inevitably lead to the termination of Mr Simister'smembership of TCTOA.Natural justice principles[23] The essence of the doctrine of natural justice was summarised by Glazebrook and Hammond JJ in their judgment for the Court of Appeal in Combined Beneficiaries Union Inc v Auckland City COGS Committee:1The term "natural justice" has a long-established meaning. The two key principles of natural justice are that the parties be given adequate notice and opportunity to be heard (audi alteram partem) and that the decision-maker be disinterested and unbiased (nemo debet esse judex in propria sua causa). The extent of the requirements of natural justice, however, depends on the circumstances and the nature of the decision, assessed in light of any relevant statutory provisions: ...(references omitted)Should a lesser standard of natural justice be applied to TCTOA?[24] Mr Mathieson relied on the judgments of Maugham J in MacLean v Workers Union,2 and the Court of Appeal in Perry v Feilding Club Inc,3 in support of his submission that the standard of natural justice required to be observed by TCTOA was not the same as that required of a Court or statutory body.[25] I reject the suggestion that these two cases are authority for applying a modified or lesser standard of natural justice to an association such as TCTOA. InPerry, the Court of Appeal found that there was no bias, there was no pre- determination, and no decision was made before Mr Perry was heard. In order to make those findings, the Court must have accepted that the relevant principles applied. Further, the Court expressly accepted that the principle of audi alteram partem applied to "every tribunal or body or persons invested with authority to adjudicate upon matters involving civil consequences".4[26] I accept the submission made by Mr T J Castle for Mr Simister, that 86 years after Perry, the relevant principles of natural justice are firmly recognised in the1 Combined Beneficiaries Union Inc v Auckland City COGS Committee [2008] NZCA 423, [2009] 2 NZLR 56, at [11]2 MacLean v Workers Union (1929) 45 LTR 256 ChD.3 Perry v Feilding Club Inc [1929] NZLR 529.4 Perry, at 543, citing Wood v Wood LR 9 Ex. 196.common law and relevant statutes (in particular, the Judicature Amendment Act 1972 and the New Zealand Bill of Rights Act 1990).[27] In Stininato v Auckland Boxing Association Inc, the Court of Appeal considered a decision by the defendant association to cancel a boxing licence.5 It was submitted that the association had acted unfairly. While dismissing Mr Stininato's appeal on other grounds, Richmond P commented on the issue of procedural fairness, and the need to comply with natural justice:6I am not aware of any authority binding on this court to the effect that a tribunal entrusted with a discretion whether or not to admit an applicant intoa "closed shop" situation is not under a duty to act fairly towards theapplicant if the tribunal has in mind the rejection of the application on theground of some specific complaint relating to the fitness of the applicant. it is not possible to lay down rigid rules as to when the principles of natural justice are to apply, nor as to their scope and extent. Everything depends on the subject-matter.Woodhouse J said:7It is not possible to categorise the circumstances which will require the application of principles of natural justice to the procedures of the domestictribunal. the broad test may well be that natural justice will apply to allpowers of decision unless there are relevant circumstances sufficient toenable the principles to be disregarded. It must always be in the publicinterest to ensure that organised bodies which have acquired the effective power to admit or exclude individuals from some widespread social or professional activity do not misuse that de facto authority by reaching decisions that involve arbitrary or capricious or discriminatory practices, or ignore relevant facts or considerations.[28] In his judgment in Auckland Boxing Association Inc v New Zealand Boxing Association Inc, Priestley J responded to a submission that a lower standard ofprocedural correctness was appropriate to the respondent, as a "voluntary organisation concerned with the sport of amateur boxing".8 His Honour acceptedthat such an allowance is made for "purely leisure-based private organisations",9 but went on to hold:5 Stininato v Auckland Boxing Association Inc [1978] 1 NZLR 1 (CA).6 Stininato, at 6.7 Stininato, at 13.8 Auckland Boxing Association Inc v New Zealand Boxing Association Inc [2001] NZAR 847 (HC) at [48]–[51].9 Auckland Boxing Association, above n 8 at [49].The level of the requirement to observe the standards of natural justice and fairness must reflect the significance and consequences of the relevant decision to those affected by it. Where the decision-making body is effectively capable of denying someone their livelihood, then the requirements of natural justice will be of a high order. Where no such weighty matters turn [on] the decision, less stringent standards are appropriate.[29] There are obvious similarities to the present case. Termination of Mr Simister's membership of TCTOA deprived him of the opportunity of access tothe IPort facility, and thus access to tour groups from the many cruise ship visits to Tauranga each season. Termination of membership of TCTOA would clearly have asignificant impact of Mr Simister's business, and thus his livelihood.[30] As to the appropriate standard of natural justice, Collins J recently said inGibson v New Zealand Land Search and Rescue Dogs Inc:10[40] The degree to which compliance with the principles of natural justice is required will depend upon the context in which the duty to comply with natural justice arises. [41] The threshold for expulsion from an organisation will also varydepending on context. In all circumstances however, there is still aminimum requirement to comply with the principles of natural justice. Even those who appear to be the least deserving are entitled to the protection of the minimum standards of natural justice when they risk expulsion from an organisation.[31] I conclude that where, as here, the consequences of the decision to terminateMr Simister's membership of TCTOA would have a significant impact on his ability to earn a living, the Courts expect a high level of compliance with the principles of natural justice. I reject the submission for TCTOA that its small size and limited resources in some way allows it to observe a lesser standard of natural justice.Evidence[32] The hearing proceeded on the basis of affidavits by Mr Simister (dated 23 March 2015, 12 June 2015, and 29 June 2015) and an affidavit by Mr K P Otto in support of the application for judicial review; and affidavits by Mr Remnant (dated 510 Gibson v New Zealand Land Search and Rescue Dogs Inc [2012] NZHC 1320 at [40]–[41], citing R v Secretary of State for the Home Department; ex p Daly [2001] 2 AC 532 (HL) at [28] per Lord Steyn.May 2015 and 20 June 2015), together with affidavits by Mr J G Mathieson, Ms C J Kelliher, Mr R G Arrowsmith and Mr B P Millar on behalf of TCTOA. An affidavit by Ms R J Moynihan was also filed, to which was annexed a transcript of the appeal meeting.[33] None of the deponents was required for cross-examination.Analysis: introduction[34] It was common ground that TCTOA's decisions are amenable to judicialreview. Similar grounds were submitted for seeking review of each of the challenged decisions. It is appropriate to consider each decision (and intervening events) in turn.The warning[35] The eight alleged breaches of TCTOA's code were as follows:(a) "Early in the season [Mr Remnant] told you on 3 occasions not toleave your unmanned vehicles in the MOCS car park. As an executive member he should only have to tell you once."(b) "You have received an agency agreement warning from RhysArrowsmith GM TBoP. We have been advised that you are bringingour association into disrepute."(c) "Last week you were observed by members of our Executive touting more than one metre from your vehicle. This is unacceptable."(d) "You sent your inventory sheet to TBoP at 9.15 pm on the 16 November for a ship on 17 November. This is required no later than 2 pm.11 This is unacceptable."11 As noted at [8](a), above, the TBoP code specifies, at 7.3, that an inventory form is to be sent to TBoP by 5.00 pm on the day prior to the arrival of each cruise ship.(e) "On Monday 17th November at the draw at Blake Park you talked over [Mr Remnant] as he was having a quiet discussion with Ian [Ian Holroyd] and his new driver. He had to ask you 3 times to stop so he could continue the discussion he was having. You then went on in front of all the operators to tell Ian in a loud voice that he was not training his drivers. You have publicly been critical of this operatoron a number of occasions. This must stop."(f) "The day before this your own new driver told the executive he didnot know what to do. Please ensure all your drivers are fully trainedand briefed before they come to the draw."(g) "You have told members of our executive that you were not told aboutthe 1 metre [touting] rule at the induction. This is untrue, both Terry [Terry Kelliher, an executive member] and [Mr Remnant] told you at the induction. Please stop spreading untruths about our organisation. You have a copy of the rules of the association and we would suggest you read them and confirm immediately as we will not tolerate anyfurther indiscretions on your part."(h) "You constantly ask for clarification and seem to delight in wastingthe time of the executive. Please can you read through the rules and make sure you are familiar with the processes. You have already had a season as an operator, and induction, and more interaction and discussions with the executive than all the rest of the organisation combined. If you cannot now conform to the rules, and understand what is required we must question whether your [sic] are a suitablemember of our organisation."[36] The warning ended "This is your final warning."[37] The following provisions of the TCTOA code are referred to in the warning:General rules and guidelines3 All TBoP agency agreement rules must be observed when working with them.6 No touting for business unless within 1 metre of a correctly parked vehicle.Standard operating procedures in the MOSC car park4 All members must behave in a courteous and respectful manner to all other operators and members of the public.[38] The warning also referred to r 15.1 of TCTOA's rules:All Members (and Executive Members) shall promote the purposes of the Association and shall do nothing to bring the Association into disrepute.Submissions[39] Mr T A Castle, for Mr Simister, first submitted that the TCTOA rules do not provide for a warning to be given, so it was ultra vires, and could not found theprocess of terminating Mr Simister's membership. Mr Mathieson's response, onbehalf of TCTOA, was to refer to r 8(i) of the TCTOA rules, which provides that theexecutive's role includes "[d]ecide the procedures for dealing with complaints and use where appropriate the procedures set out in cl 14 [Cessation of membership] ofthese Rules."[40] Mr Castle next submitted that the warning was in breach of natural justice, in that Mr Simister was not given notice of the allegations against him, he was not given a chance to be heard, the issue as to whether a warning would be given was pre-determined, and the procedure was biased, as decision-makers were also witnesses or complainants. He also submitted that the decision-makers were competitors of Mr Simister, and therefore biased.[41] Mr Mathieson submitted that as the TCTOA rules do not require a written warning to be given before a decision is made to terminate membership, the warning was not part of the termination process. Rather, he submitted, it was an educational and correctional tool. In any event, he submitted, all matters recorded in the warning had been raised with Mr Simister at the time, and were repeated in the termination notice which was sent to Mr Simister later.[42] Mr Mathieson rejected the submissions as to pre-determination and bias. He submitted that the reasonable and impartial observer would have considered that the executive members were simply carrying out their roles under TCTOA's rules.Discussion[43] I accept that the executive could, under TCTOA's rules, decide to sendMr Simister a written warning. It was not ultra vires.[44] The warning cannot be seen as solely "an educational and correctional tool"and not part of the termination process. It is replete with references to termination ofMr Simister's membership. It makes it plain that it is Mr Simister's "final warning".I do not accept TCTOA's submission that the warning was not part of the termination process. The decision to terminate Mr Simister's membership of TCTOA wouldclearly have a significant effect on his business, as termination of membership would prevent him from using the IPort facility. Having decided to send Mr Simister a final warning, the executive was required to observe the rules of natural justice.[45] There is some dispute on the affidavits as to whether the matters referred to in the warning were raised with Mr Simister at the time. Mr Simister said in his second affidavit that he was not given details of many of the allegations until well after the termination decision was made and, in some cases, details were not given until they appeared in affidavits sworn on behalf of TCTOA and filed in this proceeding. As there was no cross-examination on the affidavits, I cannot reach a conclusion on that point. However, there is no evidence that Mr Simister was given any formal opportunity to respond to the allegations set out in the warning.[46] As to the submission that the decision to issue the warning was pre- determined, and biased, it must be accepted that within a small organisation such as TCTOA, it may often be the case that complainants and witnesses will also be decision-makers. However, that simply highlights the need to allow the accused person a proper opportunity to respond before decisions are made. Here, those executive members who were not complainants or witnesses heard from only one side before deciding to issue the warning. They heard what Mr Remnant and Mr Kelliher had to say, but they heard nothing from Mr Simister.[47] For completeness, I record that I put little weight on the submission that the executive members, as competitors of Mr Simister, were therefore biased. Again, that must frequently be the case within a small organisation. However, again, that highlights the need to follow the principles of natural justice.[48] I am satisfied that the TCTOA executive did not observe natural justice in relation to giving Mr Simister the warning.Incident on 3 December 2014[49] Before considering the termination advice, it is necessary to refer to an incident on 3 December 2014 which, Mr Mathieson submitted, led to thecommencement of the process to terminate Mr Simister's membership of TCTOA.[50] It is not disputed by Mr Simister that he went to the draw on 3 December 2014, then drove in the convoy of tour operators to the MOSC car park. He then parked in the wrong car park space. Nor does Mr Simister dispute that he was asked to move to the car park space he should have parked in.[51] TCTOA's case is that Mr Simister refused to move to the correct space, whengiven the opportunity to do so. Mr Simister says in his affidavit in support of the application for judicial review that he made an honest mistake as to where he should park, and was then not able to move as vehicles were banked up behind him. He said that it is not uncommon for operators to park in the wrong place, and he does not believe anyone has been sanctioned for doing so.[52] I cannot reach a conclusion as to the disputed evidence. However, there is no evidence that Mr Simister was given any formal notice that he was alleged to have breached TCTOA's code on 3 December 2014, or that it was considered grounds to terminate his membership. Further, there is no evidence that he was given any opportunity to respond to the allegation before the termination advice was sent to him on 8 December 2014.Executive's notice[53] The executive's notice began as follows:1/You have continued to breach the rules, bylaws and code of conduct of our association and have acted in a manner inconsistent with the purposes of our association.2/We now require you to write to the executive and give reasons why the executive should not terminate your membership.3/If within 14 days after you receive this notice from the executive the executive is not satisfied, the executive may in its absolute discretion immediately terminate your membership.4/If the executive terminate your membership you may appeal to the association.5/On the 19th of November we sent you a letter of warning and it statedThe [TCTOA] executive refer you to our code of conduct and the following sectionDisputes and infringements of the Code of ConductPart 2A serious breach of our code of conduct, or repeated minor breaches by amember, may result in the operator's membership of [TCTOA] Inc beingterminated as per rule 14 "Rules of the Tauranga Cruise Tourism Operators Association Incorporated".We have now had repeated breaches our code of conduct with you since the season began and this is a warning that if this behaviour does not stop we will activate the above process to terminate your membership.You have since this letter of warning behaved in the following manner.[54] The executive's notice then refers to the incident on 3 December 2014. Comments from Mr Remnant, other executive members, and a member of TCTOA are recorded. There is then a comment by Mr Remnant concerning a discussion with Mr Simister on 4 December 2014. The executive's notice continues:So once again we have a complete disregard to our rules and authority as a committee.We now ask you Roger to respond to these reports.6/We now ask you to respond to points in our letter of warning dated 19 November.Here is a copy.[55] Having set out the contents of the warning, the executive's notice concludes:You now have 14 days to respond to the executive in writing for their consideration.If the executive is not satisfied, the executive may in its absolute discretion immediately terminate your membership.[56] I note in passing that the wording of the executive's notice leaves no doubt that the warning was, and was intended to be, the commencement of the processleading to the termination of Mr Simister's membership of TCTOA.[57] On its face, the language of the executive's notice can only be seen asconclusory ("you have continued to breach "; "once again we have a completedisregard to our rules and authority as a committee"), when it should properly have been expressed as allegations. Framed as it was, the executive's notice tends tosupport Mr Simister's submission that the executive's subsequent decision toterminate his membership was pre-determined.Solicitor's letter of 17 December 2014[58] I have already referred to the letter sent by Mr Simister's solicitors to thesolicitors for TCTOA on 17 December 2014. Mr Mathieson first submitted that,with the Christmas break approaching, "there simply wasn't time" to respond. Helater accepted that a decision was made not to respond to the letter, but submitted that any irregularity was cured by the appeal meeting.[59] As indicated to counsel at the hearing it is, in my view, extremely unfortunate that TCTOA's solicitors chose not to respond to the letter. It is quite possible that the suggested "pragmatic approach", with the individuals being properly advised, may well have led to a resolution. As a courtesy to a fellow practitioner, and in view ofthe importance of the matter, a response should have been sent to Mr Simister'ssolicitors.Alleged further breach before termination[60] TCTOA alleges that on 21 December 2014, Mr Simister displayed an advertising sign that was larger than A3 size, in breach of the TCTOA code Standard Operating Procedure in the MOSC car park, 3:Advertising – Vehicles may be sign written and display tour itineraries and information as window displays. Signs are to be no bigger than A3 size –No sandwich boards or the like are permitted.[61] In his affidavit, Mr Remnant said that this was witnessed by himself and another executive member, Mr Rowlands. Mr Remnant exhibited a copy of hisemail advice of the incident to TCTOA's solicitors, but there is no evidence of anyformal notification of the alleged breach to Mr Simister.The termination decisionSubmissions[62] Mr T A Castle submitted that by not responding to the solicitors' letter of 17 December 2014, TCTOA deprived Mr Simister of his right to respond to the allegations, as the decision to terminate his membership was made one day after theletter was received by TCTOA's solicitors. He also submitted that, as was the case with the warning, the decision to terminate was made in circumstances of actual or apparent bias, as the executive members were complainants and witnesses, as well as decision-makers.[63] Mr Mathieson submitted that the solicitors' letter did not alter the fact that Mr Simister did not respond to the allegations within the prescribed time. He submitted that the executive was therefore entitled to terminate his membership. He further submitted that an appropriate standard of natural justice was observed, and there was no pre-determination, and no actual or apparent bias.[64] Mr Mathieson also referred to a comment made later (at the appeal meeting)by Mr Simister's solicitor, to the effect that had he known that an extension of timewould not be given, a letter responding to the allegations could have been sent. Mr Mathieson submitted that this showed that Mr Simister could have responded tothe allegations, so the refusal to extend time was irrelevant. Further, Mr Mathieson referred to the alleged breach of the TCTOA code on 21 December 2014, andsubmitted that, in any event, Mr Simister was in breach of the "undertaking" given inthe request for extension of time, and had failed to comply with the condition on which the extension of time was sought.Discussion[65] I am satisfied that the decision to terminate Mr Simister's membership ofTCTOA was one which would have a significant impact on his business, and thus his livelihood. It required compliance with the principles of natural justice. The decision to terminate his membership was made without giving him a proper opportunity to respond to the allegations against him. He was not given that opportunity before the warning and, by failing to respond to the solicitors' letter of 17 December, he was denied the opportunity to respond to the executive's notice.[66] Further, I reject Mr Mathieson's submission that the solicitors' letter records an undertaking by Mr Simister, and was therefore a conditional request for an extension of time such that when on 21 December 2014 Mr Simister (allegedly) breached the TCTOA code of conduct, he could not satisfy the condition for an extension of time. On its plain words, the solicitors' letter simply records that the solicitors have receive certain instructions from Mr Simister. It cannot be construed as an undertaking, and the letter cannot be construed as a conditional request. Further, as noted earlier, there is no evidence that Mr Simister was given any formal notice of an alleged breach of the code of conduct on 21 December 2014, or given any opportunity to respond to it.[67] On the issue of bias and pre-determination, I repeat my comments in respect of the warning, at [42] above. While it may often be that in a small organisation like TCTOA, complainants and witnesses will also be decision-makers, that makes it all the more important to be scrupulous as to allowing a proper opportunity to respond before making a decision such as termination of membership. No such opportunity was given to Mr Simister in this case.[68] I am satisfied that the decision to terminate Mr Simister's membership wasmade in breach of natural justice.The termination notice[69] The executive did not advise Mr Simister of the decision to terminate his membership until 12 January 2015. The termination notice, sent to Mr Simister under cover of a letter to his solicitors, set out three grounds for termination:1 You have continually breached the Rules and Code of Conduct of [TCTOA];2 A letter of warning was given to you on 19 November 2014 for breaches of the Code of Conduct;3 In accordance with rule 14.2(a) an Executive's Notice was given toyou on 8 December 2014 which invited you to give reasons why your membership should not be terminated within 14 days (by 22 December 2014). We received no correspondence from you providing any reasons. On 17 December 2014 we received a letter from your solicitor advising us of their appointment, but not stating any reasons why your membership should not be terminated.[70] The covering letter set out five allegations of "further" breaches of the TCTOA Rules and Code of Conduct. The allegations set out by TCTOA's solicitorsmay be summarised as follows:(a) the incident on 21 December 2014;(b) parking in the wrong place on 24 December 2014;(c) on 24 December 2014, having clients waiting in his vehicle for one hour and five minutes, when the norm is 15-30 minutes;(d) on 24 December 2014, failing to deliver customers booked for a tour to Whakarewarewa (a complaint made by Whakarewarewa Thermal Village Tours to TBoP);(e) on 24 December 2014, having customers booked for three tours on two tour buses;(f) on 5 January 2015, without authority, informing TBoP that there would be no draw for parking, contrary to what was agreed at an earlier meeting attended by Mr Simister.[71] No further details were given of the alleged further breaches, and no reason is given for including them in the letter. Further, the letter gave no explanation for the delay in sending out the termination notice.[72] Again, it may be noted that the fact that the warning was included in the grounds for terminating Mr Simister's membership of TCTOA underlines theimportance of the warning to the termination process.Breaches of the TBoP code[73] As noted earlier, TBoP suspended Mr Simister for five consecutive cruise ship days as from 12 January 2015, for breaches of the TBoP code, following a warning having been given on 7 November 2014 (the substance of which had been copied into the TCTOA warning of 19 November 2014). The breaches which led to the suspension had occurred on 24 December 2014, and are appear to be identical to those referred to in the covering letter to the termination notice, summarised at [70](c)–(e), above.[74] In an email dated 15 January 2015, clarifying the terms of the suspension, Mr Arrowsmith of TBoP told Mr Simister "we'd like to see you back as soon aspossible. prior to selling your tours again we will need to sit down and start with a clean slate understanding."[75] Mr Simister met with TBoP on the morning of 2 February 2015. Mr Arrowsmith advised Mr Remnant later that morning that:The outcome from this meeting is that we feel Roger [Simister] now has a clear understanding of our expectations. The conclusion is that we are happy to lift the suspension and resume selling Arrow tours however it remains subject to Arrow tours membership to TCTOA being reinstated.TBoP strives toward providing an even balance pragmatic approach where, fairness and professionalism prevails. This is a positive outcome that wehope lessons have be learnt and approach to issues in the future are better communicated or resolved.[sic]Mr Simister's letter of explanation[76] On 23 January 2015, Mr Simister's solicitors sent a "letter of explanation" to TCTOA's solicitor. It was marked "without prejudice". A copy of the explanation isannexed to Mr Remnant's second affidavit. In the explanation, Mr Simister refers tothe solicitors' letter of 17 December 2014 and the termination of his membership,and responds to the allegations against him, recording that his responses are on "thelimited material that has been provided to me by the Executive".The appeal meeting[77] The appeal meeting was attended by all six executive members, and 16 members of TCTOA. The meeting was chaired by Mr Remnant. The meeting was told that executive members, and three members who were witnesses in relation to alleged breaches, would be excluded from voting. Accordingly, 13 members were eligible to vote.[78] Shortly before the appeal meeting, Mr Simister was sent a document headed"Procedure to hear Roger Simister's (Arrow Tours) Appeal". This set out eightmatters to be considered (paraphrasing the matters set out in the executive's notice of8 December 2014), the issues to be determined (the facts, whether it was reasonableto terminate Mr Simister's membership, and whether termination was proportionate to the facts as determined), and the procedure to be followed at the meeting.Submissions[79] Mr T J Castle submitted that the appeal meeting was not conducted in accordance with the TCTOA rules, or in accordance with the principles of natural justice.[80] Regarding the TCTOA rules, Mr Castle referred to r 14.2(d) of the TCTOArules, which provides in relation to a meeting at which a member's appeal is heard:When the Member is heard at an Association Meeting, the Association may question the Member and the Executive Members.Mr Castle submitted that the effect of r 14.2(d) is that the executive members (prior decision-makers) may be present at the appeal meeting to be asked questions, but may not themselves ask questions. He submitted that in breach of r 14.2(d) executive members interrogated Mr Simister at the appeal meeting, and relentlessly and vociferously challenged him over his alleged breaches. He submitted that evenspouses of executive members "launched into" Mr Simister, and any protest by him was dismissed.[81] Mr Castle also submitted that TCTOA wrongly considered alleged breaches of the TBoP code at the appeal meeting. As these had been resolved between TBoP and Mr Simister before the appeal meeting, they were an irrelevant consideration.[82] Further, Mr Castle submitted that the executive members and witnesseswrongly remained in the room when the vote was taken on Mr Simister's appeal. Hesubmitted that this raised the danger (at least) of improper influence by the prior decision-makers, and thus bias in the appeal decision.[83] In summary, Mr Castle submitted that there was no due process, and no fair procedure observed at the appeal meeting. He submitted that the appeal meeting was properly described as a farce which could not, and did not, cure any earlier defects; rather, it compounded them.[84] Mr Mathieson submitted that r 14.2(d) of the TCTOA rules did not preclude executive members from asking questions of Mr Simister. He submitted that the matter of the executive asking questions was not provided for, so the executive could determine the procedure.[85] As to the alleged breaches of the TBoP code, Mr Mathieson submitted that these were properly raised, as Mr Simister had misled TCTOA in saying that matters between them were resolved and, in particular, that TBoP wanted to "see him back as soon as possible".[86] Regarding the presence of executive members and witnesses during voting, Mr Mathieson submitted that there was no danger of improper influence or bias, as Mr Simister and his lawyer also remained in the room. Further, he referred me to his opening comments as to the procedure to be followed, and the principles of natural justice.[87] In summary, Mr Mathieson submitted that if the transcript of the appeal meeting is read as a whole, it can be accepted that there was compliance with the appropriate standard of natural justice.Discussion[88] I turn first to the issue as to the TBoP breaches. The documentary evidencebefore me tends to support Mr Simister's contention that matters between him and TBoP had been resolved, and that he had been told that TBoP wanted to see him back, subject to his being reinstated as a member of TCTOA. As the TBoP breaches had been resolved, they were not a relevant consideration at the appeal meeting, and ought not to have been referred to. However, they were referred to, and Mr Simister was accused of misleading TCTOA.[89] I accept Mr Castle's submission that r 14.2(d) does not allow for executivemembers to ask questions at the appeal meeting. The rule is clear: "the Associationmay question the Member and the Executive Members". It does not say that theexecutive may question the member. That interpretation is consistent with thepurpose of the appeal meeting, which is to hear the member's appeal to theAssociation against the decision made by the executive. I do not accept Mr Mathieson's submission that it was open to the executive to, in effect, disregardr 14.2(d) by relying on r 27.1(h) which provides "Matters not covered in these Rulesshall be decided upon by the Executive". The rules as to questioning at the appeal meeting is not something that is "not covered" in the TCTOA rules.[90] On the more general issue as to whether Mr Simister was given a fair appeal hearing, in accordance with the principles of natural justice, having reviewed the transcript of the appeal meeting, it is evident that at the start of the meeting, Mr Mathieson addressed the meeting, and appropriately directed members as to thematters that could properly be considered by members, and the requirements ofnatural justice. He was followed by Mr Attwood, Mr Simister's lawyer.[91] However, it is also evident that, very shortly thereafter, the meeting became unstructured, and uncontrolled. Although Mr Mathieson submitted that each matter set out in the warning and executive's notice was discussed one after the other, withMr Simister able to give his side of the story, and the executive members able to give their side of the story, with questions from members present, that is not what emerges from the transcript. Mr Castle's characterisations of the questions asked by executive members of Mr Simister as being "interrogation", and "vociferous challenges", and appeal meeting as a "free for all" are, regrettably, apt.[92] The final issue relating to the appeal meeting is Mr Castle's submission thatthe presence of the executive members during voting is sufficient to raise a real danger of influence and bias. Mr Castle referred me to Church v The Auckland Commerce Club,12 and Gibson v New Zealand Land Search and Rescue Dogs Inc.13In Church Venning J held that the involvement of a prior decision-maker in an appeal hearing was sufficient to show a real danger of bias.14 In that case a Mr Watson had been a member of a Board that had suspended Mr Church'smembership and instituted disciplinary proceedings, had chaired a JudicialCommittee, communicated the Judicial Committee's decision to Mr Church'ssolicitor, been present throughout the appeal hearing, and retired with the Board of Appeal.[93] In Gibson v New Zealand Land Search and Rescue Dogs Inc, Collins J noted that the rule of administrative law requiring decision-makers to be impartial was breached when a prior decision-maker wrote to the members hearing Mr Gibson's appeal in terms "which were clearly intended to influence their decision".15[94] Mr Mathieson referred me to the Armstrong v Kane, in which Wilson J held that the fact that the President of a Union had presided over a disciplinary hearing12 Church v The Auckland Commerce Club HC Auckland CIV 2002-404-2441, M1296-02, 9 July 2003.13 Gibson v New Zealand Land Search and Rescue Dogs Inc, above n 10.14 Church, above n 12 at [103].15 Gibson, above n 10 at [51].concerning Mr Armstrong (who was challenging him for the presidency), had taken a leading part in questioning him, but had not voted on a motion to suspend him, did not lead to a conclusion that the disciplinary hearing was invalid.16[95] However in that case it was not alleged that any questioning was unfair, or that Mr Armstrong was not given a full opportunity to put his case. The sole groundrelied on for invalidity was that Mr Kane's mere presence at and participation in thedisciplinary hearing was sufficient to vitiate the whole proceeding.17 Further,Armstrong v Kane was not a case where involvement of prior decision-makers was at issue. The facts of Armstrong v Kane are distinguishable from those of the present case.[96] I have concluded that the prior involvement of the executive through the process of issuing the warning and the executive's notice, and terminatingMr Simister's membership, and their subsequent active involvement in the appealmeeting and presence during voting is sufficient to raise a real danger of influence over remaining members and, therefore, a real risk of bias. The fact that Mr Simister and his lawyer were also present during voting does not ameliorate the danger.[97] Accordingly, I conclude that Mr Simister's appeal was not given a hearing inaccordance with the rules of TCTOA, or in accordance with the principles of natural justice. The appeal meeting could not, and did not, cure any of the defects arising in the earlier decisions.Conclusion as to claims of breaches of natural justice[98] I conclude that at no stage was Mr Simister dealt with by TCTOA in accordance with the rules of natural justice. It is necessary to go on to consider what remedy, if any, is appropriate.16 Armstrong v Kane [1964] NZLR 369 (HC) at 374.17 See at 372–373.Relief[99] It is well accepted that the courts have a discretion as to what remedy, if any, to grant in a proceeding for judicial review. Mr Simister sought relief by way of orders quashing the decisions to issue the warning, to terminate his membership of TCTOA, and to uphold the termination decision. He also sought an order reinstating his membership. Further, Mr Simister sought a declaration that the TCTOA Rules breach the principles of natural justice, and should be re-drafted accordingly.Submissions[100] Mr T J Castle submitted that if I were to find any one or more of the decisions failed the threshold for natural justice, there was no room for exercising my discretion against quashing the decisions. He referred me to Gibson in which Collins J quashed the decision to expel Mr Gibson, while expressing some sympathy for the difficulties faced by the defendant organisation because of its small size, dependency on volunteers, and limited access to legal advice and assistance.18Mr Castle further submitted that the Court should not remit the matter back for reconsideration, as the result would be the same.[101] Mr Mathieson submitted that if I were to find a breach of natural justice, I should decline the relief sought. He referred me to the decision of Speight J inWislang v Medical Practitioners Disciplinary Committee, in which his Honour considered three issues, before concluding that the relief sought by Dr Wislang should not be granted:19(a) the nature of the irregularity, with particular reference to whether any different result would have been arrived at;(b) the conduct of the applicant; and(c) the existence of an alternative remedy.18 Gibson, above n 10 at [53].19 Wislang v Medical Practitioners Disciplinary Committee [1974] 1 NZLR 29 (SC) at 42–43.[102] On the first point, Mr Mathieson submitted that any breach of natural justice was minor, and the same decision would have been made even if there had been no breach. On the second point, Mr Mathieson submitted that had Mr Simister notbreached TCTOA's rules and code after the final warning, and if he had compliedwith the executive's requests and respected the members and purposes of TCTOA,the outcome may have been different. Finally, on the third point, Mr Mathieson submitted that the appeal meeting was a fair alternative remedy.Discussion[103] I have found that TCTOA failed to observe the principles of natural justice ina number of respects. The number and nature of TCTOA's breaches are such thatthey cannot be disregarded, or brushed over as minor. I am satisfied that the starting point for a remedy must be that all three challenged decisions must be quashed. The alternatives then available to me are to remit the matter back to TCTOA for reconsideration; or to quash the decision but not remit it back – that is, to order Mr Simister's reinstatement as a member of TCTOA.[104] In considering the option of remitting the matter back for reconsideration, certain submissions made on behalf of TCTOA cause me concern. These are the submissions that even if the executive had not terminated Mr Simister's membershipin December 2014, his continuing conduct would have led to a further decision toterminate, and that Mr Simister's return would "undoubtedly" create disruptionwithin TCTOA and the MOSC car park. It was suggested that such disruption might have significant implications for the cruise ship tourism industry in Tauranga.[105] The former submission appears to indicate pre-determination, and the second appears to indicate a substantial degree of animosity towards Mr Simister. Either ofthese would be a substantial impediment to Mr Simister's having a fair hearing.[106] Against that, Mr Simister and TBoP have resolved matters (subject to Mr Simister being reinstated as a member of TCTOA). This gives grounds for some confidence that Mr Simister and TCTOA should be able to establish a modus operandum, under which Mr Simister and TCTOA members can carry on their businesses, and visiting tourists can be taken on the tours they want.[107] In the end, I have reached the conclusion that I should order that Mr Simister is reinstated as a member of TCTOA, effective as from the date of this judgment. The sentiments expressed by Mr Arrowsmith of TBoP in his message to Mr Remnant on 2 February 2015 are apt, and should be taken to heart by both sides in this proceeding. The parties should strive towards a balanced and pragmatic approach, where fairness and professionalism prevails. Lessons will now have been learned, and there should be better communication and resolution of issues, on both sides, in the future.Conclusion as to application for judicial review[108] My formal orders are as follows:(a) The decisions by the TCTOA executive to issue a warning to Mr Simister and to terminate his membership of TCTOA are quashed. The decision by the members of TCTOA to uphold the termination is also quashed.(b) I decline to remit the matter back for reconsideration. Mr Simister is to be reinstated as a member of TCTOA as from the date of this judgment.(c) I decline to make any declaration as to the TCTOA Rules. The issues in this proceeding have centred on the application of the rules, and processes followed, not the rules themselves.Breach of contract[109] Having found that TCTOA was in breach of natural justice in its dealings with Mr Simister, I accept that TCTOA is also in breach of contract.[110] Mr T J Castle submitted that Mr Simister's claim for losses arising from thebreach is modest, and an award of damages should flow. However, I have concluded that, as did Collins J in Gibson, I should decline to make an award for damages. This is for the following reasons:(a) Mr Simister's primary objective (evident from the focus of hissubmissions) was to quash the decision terminating his membership of TCTOA. He has succeeded in that objective.(b) TCTOA is a small business organisation with a very limited income from membership fees. I have seen no evidence that it could meet an award of damages. I cannot see that bankrupting TCTOA would serveeither side's interests.[111] Accordingly, while finding that TCTOA was in breach of contract, I make no award for payment of any damages.Costs[112] I did not receive submissions as to costs. My present view is that any orderfor costs in favour of Mr Simister should be very modest, given TCTOA's limitedability to meet an order for costs. In the event that costs cannot be resolved, submissions may be filed on behalf of Mr Simister within seven days of this judgment, and on behalf of TCTOA within a further five days.__________________________Andrews J