LITON v THE BANGLADESH ASSOCIATION NEW ZEALAND INCORPORATED [2013] NZHC 1249

LITON v THE BANGLADESH ASSOCIATION NEW ZEALAND INCORPORATED [2013] NZHC 1249 [29 May 2013]IN THE HIGH COURT OF NEW ZEALANDAUCKLAND REGISTRYCIV-2013-404-1110[2013] NZHC 1249BETWEEN SYED IFTEKHAR UDDIN LITONPlaintiffAND THE BANGLADESH ASSOCIATIONNEW ZEALAND INCORPORATEDDefendantHearing: 29 May 2013Counsel: F J Peters for the PlaintiffSRG Judd for the DefendantJudgment: 29 May 2013ORAL JUDGMENT OF WOODHOUSE J[1] Mr Liton seeks an interim injunction effectively reinstating him as treasurer of the respondent Association. He was elected treasurer in May 2012. As treasurer he is a member of the executive committee of the Association. The position, interms of the constitution of the Association, is held for 12 months, expiring on 31May of each year. Certainly that is the case in respect of Mr Liton's election in Mayof 2012. In consequence the position Mr Liton was elected to comes to an end intwo days time.[2] The brief background to the present application and the substantive claim isas follows. In November 2012 three members of the Association made a complaintto the executive committee – or perhaps to the secretary – about the election in May2012 of the president. The three complainants said that because of the alleged votingirregularities the executive committee did not have any right to deal with thesociety's funds. I am stating this in general terms but it captures the essence forpresent purposes.[3] Mr Liton decided that in the face of this complaint he should cease to operatethe Association's bank account. Again, I am stating that in rather general terms but itis sufficient. In particular, he was one of two necessary signatories on all cheques that had to be issued.[4] The complaint from the three complainants about the election went to a meeting of the executive committee. They determined that it was not necessary to take any steps in response to it. Mr Liton took a different approach. He advised the executive committee, of which he was a member, that he did not wish to expose himself to risk in signing cheques or taking other steps as treasurer until the complaint of the three complainants had been sorted out. Efforts were made to try to resolve what can be described as an impasse between Mr Liton and the other members of the executive committee, or at least a majority who were wanting him tocontinue to perform his duties as treasurer. It is plain enough at least from minutesof the Association that Mr Liton was adamant in the position he had initially taken. Ineed not go into the detail but I refer in particular to the minutes of a meeting of theexecutive committee on 9 December 2012 and a letter Mr Liton wrote to the generalsecretary of the Association on 12 December 2012.[5] The majority of the executive committee treated Mr Liton's stance aseffective resignation. The constitution provides, in clause 7, for resignation by a member of the executive committee. Mr Liton's advice to the general secretary doesnot in any express way state that he is resigning and that gives rise to one of the issues that may need to be addressed. In any event the executive committee, as I say, treated a letter from Mr Liton as amounting to a letter of resignation and in terms of clause 7 the executive committee then accepted the resignation and appointed a new acting treasurer.[6] Mr Liton then brought this proceeding. He initially applied ex parte. Venning J declined the ex parte application on the basis that there was no particular urgency and some orders in any event appeared to be inappropriate for interim relief. I indicated to Mr Peters in the course of his submissions that it was unnecessary to address matters relating to the reasons why the application was brought ex parte. The matter is now proceeding on notice.[7] The application in broad terms seeks declarations that Mr Liton is still the lawfully elected treasurer and that actions taken by the executive committee as indicated in the preceding summary were contrary to the constitution of the Association. An order is also sought restraining the Association and its servants or agents from removing Mr Liton as treasurer.[8] The application is opposed both on the basis that there is not a serious issue to be tried and on the balance of convenience. There is an affidavit from Mr Liton in support of his application, a reasonably detailed affidavit in opposition from the general secretary, and an affidavit in reply from Mr Liton.Serious question[9] Because of the conclusion I have reached, and which I will come to in a moment, on the balance of convenience, which is against Mr Liton, it is unnecessary to express any opinion on whether there is a serious question to be tried. And because of the firm conclusion on the balance of convenience it is inappropriate to express any opinion under this heading because Mr Liton may wish to pursue his substantive application for relief. I should record that the fact that I have refrainedfrom expressing any opinion should not lead to any inference one way or the other as to what my opinion might be.Balance of convenience and overall justice[10] I will deal together with the balance of convenience and overall justice. These matters in my judgment strongly favour the Association on the question as to whether there should be an interim injunction. I will simply note these matters.[11] The decisive consideration in my judgment is that to make the orders sought at this point would be pointless in large measure. This is because Mr Liton's term astreasurer expires, or would expire, in two days. Coupled with that is the fact that it has been open to him, if he wished to do so, to seek to vindicate the position he hasadopted by standing for re-election. The constitution indicates that new electionswould generally take place around about now. I do not know whether that has in facthappened, but it is a related consideration supporting the primary conclusion that anorder would, in effect, be futile.[12] There is the fact that Mr Liton chose at least to suspend performance of his duties as treasurer because of the assertions of three only of the members of the Association. Without expressing any concluded view, having regard to the fact that the substantive claim may continue, it is somewhat difficult to see how this could bejustified even if there was some merit in the assertions of the three complainants.The Association contends that Mr Liton was, in effect, holding the executivecommittee to ransom by declining to perform his duties until the other members ofthe executive committee dealt with the problem in the manner that Mr Liton thoughtit should be dealt with them. I express no opinion on Mr Liton's motivation. MrLiton has indicated, through Mr Peters, that he had concern for his personal liabilityif he was party to issuing cheques in circumstances where they should not have beenissued, which was the contention of the three complainants. Mr Liton's motivationmay have been completely genuine, but the reality is that, whatever the underlyingmerit, the operations of the Association in certain respects were coming to astandstill – certainly in relation to the payment of creditors where cheques had to beissued.[13] Declining an injunction does not in my judgment, particularly at this date, result in any material injustice to Mr Liton. As I have already indicated, if he wished he could seek to be vindicated for his actions by standing for re-election. Whether or not he has in fact done that, he does have the substantive claim which he can proceed with. Nothing of any relevance that might otherwise be available to Mr Liton will belost if the interim injunction application is declined.[14] For these reasons the application for an interim injunction is dismissed.[15] The Association is entitled to costs. Mr Judd advised that his instructions were to seek indemnity costs. I am not persuaded that there is any proper basis for indemnity costs. Having heard further from Mr Peters on the question I am satisfied that costs should be awarded on a 2B basis with reasonable disbursements.[16] There is need for directions for the disposal of the substantive proceeding. Mr Peters has advised that it will assist if he obtains some instructions from Mr Liton as to whether Mr Liton does wish to proceed with the substantive claim. In this regard, as discussed with Mr Peters, if the substantive claim is to proceed the statement of claim should be amended because it presently contains a substantial amount of evidence which should not be in a statement of claim.[17] Consequently there are the following directions:(a) If Mr Liton wishes to proceed with his substantive claim an amended statement of claim, setting out the essential contentions but without evidence, is to be filed and served within one month.(b) A statement of defence should then be filed and served within 14 daysof service of the amended statement of claim.(c) The proceeding should then be listed for the first case management conference in the usual way with the normal directions applying in that regard.(d) If Mr Liton decides that he does not wish to proceed with his substantive claim then a notice of discontinuance can be filed.________________________________Woodhouse J