CLARE, BARONESS BAILLIEU v. THE FOREIGN CORRESPONDENTS' CLUB, HONG KONG

HCMP1567/2006

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 1567 OF 2006

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Dates of Hearing : 24, 27, 28 and 30 October 2008

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J U D G M E N T

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1. The plaintiff is suing the defendant in respect of her membership of The Foreign Correspondents’ Club, Hong Kong (“the Club”).

2. The action relates to her suspension from the Club on 22 March 2005 and the cancellation of her membership on 12 August 2005.

3. She complains that the Club failed to comply with the Rules of Natural Justice, were in breach of the terms of the Club’s Articles of Association and that it acted mala fides.  At the conclusion of the trial the plaintiff withdrew her claim that the Club acted mala fides.

4. Initially she also claimed damages but this claim was no longer pursued. 

5. The Club were counterclaiming for the subscriptions they were claiming for the period when the plaintiff was in Hong Kong while she claimed to be an Absent Member.

6. The plaintiff gave evidence that she joined the Club in September 1991 as an Associate Member.

7. In December 1998, she applied to the Club to transfer her membership status from being an Associate Member to becoming a Life Absent Member for which she paid the Club $2,000.  

8. It is perhaps relevant to observe that at the time of this application there was no provision in the Articles for life absent members.  There was provision for absent members and Articles 27 and 28 read as follows :

“27.   A Member who may be leaving Hong Kong for three or more consecutive months, provided he previously shall have given notice to the Secretary in writing that he desires to have his name placed upon the list of Absent members, and provided that he pays an Absent Member subscription, shall not be liable to pay his monthly subscription for the time he is absent from Hong Kong.

28.     Absent Members shall pay an Absent Member subscription, the amount of which shall be determined by the Board, payable at the commencement of each twelve months or part of twelve months of their absence.  Immediately upon their return to Hong Kong they shall be liable for the usual monthly subscription including the month when such Absent Member returns.”

9. In this judgment I will use the terms “Absent Member” and “Life Absent Member” interchangeably but no significance attaches to this.

10. The reason given by the plaintiff for making this application was that her father, who was resident in Australia, was ill and she wished to assist him.  She did not know when she would be returning to Hong Kong.

11. When she made her application she claimed that she informed the General Manager of the Club, Mr Sanders, that unless the Club otherwise advised she considered she would be entitled to hold membership in two classes, namely, as an Associate Member with membership held indefinitely in life absent status which could be reverted to active associate membership at any time at her pleasure and spouse membership which she intended to obtain by virtue of her relationship with another member, Mr Nedderman who, she described, as being a “life partner”.  He is in fact her husband.

12. This part of her evidence was hotly contested by the Club.

13. When the plaintiff described in the witness box what had transpired when she made her application, she said that she had been in the main bar of the Club and while she was walking towards the Club’s office she encountered Mr Sanders and gave him the application form she had completed.  He asked her how long she would be away and, on being informed that it would be three months, he said that would be alright.  He had then gone on to say that if, on her return, she went on Mr Nedderman’s account there would be no problem as everyone did it.

14. It will be observed that this advice is directly contrary to Articles 27 and 28 which specifically impose a duty upon members returning to Hong Kong to immediately inform the Club of this, whereupon the monthly subscription again becomes payable.

15. There are also provisions in the Articles requiring a member to give one month’s notice in writing of his or her intention to resign from the Club.

16. There are, however, no provisions entitling a member to belong to two classes of membership.

17. Having regard to the casual nature of the encounter with Mr Sanders, it would appear to be unlikely that he would, of his own volition, give advice which was clearly contrary to the provisions contained in the Articles of Association.

18. Be that as it may, on her return in March 1999, Mr Nedderman made an application to the Club for the plaintiff to become a “Spouse Member” which entitled her to enjoy the privileges of being a member of the Club and chits which she signed for services provided would be debited to Mr Nedderman’s account.

19. The Club issued her with a card enabling her to activate the account.

20. She did not, at any time after her return, activate her associate membership status nor did she give actual notice of her return as was required by the Articles of Association.  She did, however, attend the Club premises on numerous occasions and even participated in some of the activities undertaken by the Food and Beverage House Committee.

21. In May 2002, Mr Nedderman was elected to the Board of Governors of the Club.

22. Although for the purposes of this judgment it is not necessary for me to go into the matter in any detail, it appears that there was some friction between Mr Nedderman and some other members of the Board of Governors and, at a meeting on 11 March 2005, there was an altercation involving Mr Nedderman, David Garcia, the Convener of the Board and Mr Gilbert Cheng, the General Manager at that time, the result of which led to Mr Nedderman’s suspension from the Club.  This was resolved at a meeting on 19 March 2005 and the suspension was for six months from 22 March 2005.

23. On 22 March 2005, there was an exchange of emails between the plaintiff and various officials of the Club.

24. The plaintiff was demanding a copy of the minutes of the 19 March 2005 meeting which had taken place and of any other documents in which reference was made to her.

25. To get a flavour of the correspondence it may be helpful to see a copy of the plaintiff’s email to Mr Garcia which was copied to the President of the Club at that time, Mr Matt Driskill :

“Hi Dave

Since enactment of the Hong Kong Bill of Rights Ordinance, any attempt to extend suspension of a member’s privileges to a spouse member will constitute a direct infringement of that spouse member’s individual rights.

Be that as it may, I am in any event a member in my own right.

Please supply the amended minutes as shown to the Board.

Clare”

26. It is pertinent to observe that in this correspondence the plaintiff attempted to assert her right to sighting the documents by claiming to be a member by virtue of her Life Absent Membership.

27. It would appear that it was this which put the Club on notice of the apparent irregularity in the plaintiff’s membership status.

28. The plaintiff said that she later learned that on the same day Mr Masaharu Ushiyama, who was the Convener of the Membership and Finance Committees, had without giving any notice to her or affording her any opportunity of making any representations suspended her Life Absent Membership with immediate effect.

29. She surmised that he had taken this action so as to prevent her from seeing the documents she was seeking.

30. Following this, the plaintiff wrote various letters or emails to the Club demanding an explanation for what had transpired but at no time did she ever receive any satisfactory explanation.

31. The plaintiff’s then solicitors, Hampton Winter and Glynn, wrote to the Club on 24 March 2005 in these terms :

“24 March 2005

Dear Sir,

Baroness Baillieu

We act for Lady Baillieu who is both a spouse member and an absent member of the Club in her own right.

We are instructed that our client has recently been informed by Mr Ushiyama that there has been an official decision that her right of entry to the Club has been suspended.

Our client has no knowledge of any allegation made, meeting being convened or decision taken by the Board against her.

There is simply no basis whatsoever for our client’s membership to be suspended.  Not to mention that no formal notification and reasoning for such suspension and/or its duration has been given to our client.

Unless a satisfactory explanation is received by us by close of business on 29 March 2005, a formal complaint will be lodged pursuant to Article 13 of the Articles of Association.  Meanwhile, our client remains entitled to enjoy all her privileges under her membership.

Yours faithfully,

Signed

HAMPTON, WINTER AND GLYNN”

The Club replied as follows :

“29 March 2005

Hampton, Winter and Glynn

…

Dear Sirs :

In response to your correspondence dated 24 March 2005, please note the following:

The Spouse Membership privileges of Baroness Baillieu are dependent upon the good standing of her spouse, Mr. Anthony Nedderman.  Under Article 8 of the Memorandum and Articles of Association of the club, ‘A spouse of a Member shall be accorded the use of the Club’s premises and facilities on the Member’s subscriptions.’  Since Mr. Nedderman’s privileges have been suspended, the spouse’s privileges are also suspended as a matter of course and no notification is required under the bylaws since the Member himself has been notified by registered post.

With regards to the second point raised in your letter that the Baroness is also an ‘absent Member’ of the club, this privilege only applies to members who are not resident in Hong Kong.  Articles 27, 28 and 29 apply.  I would draw your attention in particular to Article 28 which states in part, ‘… Immediately upon their return to Hong Kong, they (the members) shall be liable for the usual monthly subscription including the month when such Absent Member returns.’

The Club’s database shows that the Baroness was granted absent member status on 29 December 1998.  If she has been resident in Hong Kong since that time, then she will be required to pay the monthly subscription amount that is in arrears for the past seven years and must reapply to the Club to activate her absent membership as an active membership.  Further, if she has been a resident since that time and has utilized absent membership while a resident, this is a clear violation of the club’s bylaws.  I have directed the club’s financial controller to research the records to determine whether this violation has occurred and thank you for bringing this to our attention.

Yours faithfully,

Signed

Matthew C. Driskill

President, By and on Behalf of the Board of Governors Foreign Correspondents Club of Hong Kong”

32. It will be noted that the Club did not specifically deal with the suspension of the plaintiff’s Absent Membership save but to inform the solicitors that they were conducting an inquiry to ascertain whether a claim could be made for monthly subscriptions to be payable in respect of the period following the plaintiff’s return to Hong Kong.

33. Again, without the knowledge of the plaintiff, a meeting was held on 23 July 2005 when it was resolved that the plaintiff’s Life Absent Membership should be terminated.  According to the minutes of the meeting, discussion of this item of business only took three minutes.

34. The plaintiff was not informed of this until 12 August 2005.

35. The plaintiff commenced legal proceedings on 1 November 2005.

36. Shortly after this, the Club formulated a claim for $74,105 which sum represented monthly subscriptions payable after the plaintiff’s return from Australia in March 1999 up to the date of her suspension.

37. The plaintiff was subjected to a quite searching cross-examination by Mr Bell who was representing the Club.  She was unable to provide any satisfactory explanation for the fact that although the alleged conversation with Mr Sanders was important she had not placed any reliance upon this shortly after she was first informed that an investigation would be undertaken into the circumstances surrounding her claimed change of status from a Life Absent Member to becoming a Spouse Member of Mr Nedderman.

38. Her evidence concerning the allegation she was making that the Club had not been acting in good faith was also not very satisfactory.

39. Mr Bell took her through the minutes and correspondence relating to the incidents which brought about Mr Nedderman’s suspension and she did not accept that Mr Nedderman had been at fault in any way.

40. It was clear that she had not read the Articles of Association of the Club and persisted in her claim that she was in no way at fault.  This was notwithstanding the fact that it is manifest from Article 7 that a duty is imposed on a member to notify the Club of any circumstance which may affect his or her membership classification :

“7.     A Member shall notify the Board of any circumstance which may effect his membership classification whereupon the Board shall meet to decide whether such Member’s classification of Membership should be changed.  The Board may hold such a meeting on its own volition and in that event it shall give to the Member concerned not less than 14 days’ notice in writing of its intention to review that Member’s classification of Membership.  The Member shall be entitled to appear before the Board at any such meeting or adjourned meeting and may make such representations as he thinks fit.”

41. The plaintiff also was unable to substantiate in any convincing manner her complaint that the Club had been acting mala fides.

42. One puzzling aspect of her evidence related to the use she had made of the facilities of the Club since the lifting of Mr Nedderman’s suspension.  She said that she had only used the Club on a few occasions as she was under the impression that the staff of the Club displayed a hostile disposition towards her.  This has some relevance to the relief she is seeking concerning her reinstatement as a Life Absent Member.  There would not appear to be much point in ordering her reinstatement to this class of membership as it would confer upon her no practical benefits over and above the rights she already enjoys.  She is clearly at the present time not an Absent Member and if her past intentions are anything to go by, it is unlikely she will wish to convert to becoming a member in her own right particularly as this would necessitate the payment of a monthly subscription.

43. I regret that I did not form a favourable view of the plaintiff as a witness.  I believe that she was not telling the truth concerning the alleged advice she received from Mr Sanders about her Life Absent Membership.  Certainly where there is a conflict between her version of what transpired and his, I prefer his evidence. 

44. In addition to this I believe that on a number of occasions she exaggerated her evidence and was not a frank and honest witness.  In particular I refer to her evidence concerning the unhappy events in relation to the incidents which led to the suspension of Mr Nedderman.

45. It is difficult to avoid coming to a conclusion after weighing and considering all the relevant evidence that the plaintiff deliberately decided not to inform the Club of her return to Hong Kong so that she could maintain her membership rights while at the same time avoiding payment of subscriptions by virtue of obtaining spouse privileges under Mr Nedderman’s membership.  I believe that she knew full well that she was not entitled to hold two classes of membership and, to say the least, this was less than honest.

46. Mr Ushiyama was the only other witness for the plaintiff.  He was the holder of a number of offices in the Club at the relevant time.  He was aware of the situation concerning the plaintiff and was cognisant of the events leading up to the suspension and termination of the plaintiff’s membership.

47. He strongly denied that the Club had in any way acted in bad faith towards the plaintiff.  He did however agree that the hearing in relation to the plaintiff’s suspension had been undertaken with great expedition.

48. He had received advice from Mr Egan, the Committee Member in charge of constitutional matters, that this was necessary.  The reason being that unless a suspension was ordered expeditiously the plaintiff might reactivate her own membership and thus enable her to nominate Mr Nedderman as her spouse member.  The consequence of this would have been that the disciplinary action which had just been taken against Mr Nedderman would have been effectively frustrated and rendered nugatory.  

49. I found Mr Ushiyama to be a truthful and reliable witness and accept him as a witness of the truth.

50. Two witnesses were called for the Club.  The first was Mr Kevin Egan.  As stated earlier he was at the relevant time the convenor of the Constitutional Affairs Committee and was a member of the Board of Governors. 

51. As he is a barrister-at-law he also gives legal advice to the Club when called upon to do so.

52. He gave evidence that he had knowledge of the circumstances surrounding both the suspension and the termination of the plaintiff’s membership of the Club.

53. He accepted that there had been some problems concerning some members applying to become Life Absent Members and then failing to inform the Club of their return to Hong Kong if indeed they had ever gone away.  The consequence of this was that even though they were resident in Hong Kong, they evaded payment of the monthly subscription.

54. He emphasised however that this abuse was not widespread and that when it came to the knowledge of the Club it would take the necessary remedial action. 

55. In a similar vein he was aware that there had been occasions when there had been abuses of the spouse member status which was a derivative right flowing from a member.  There were far fewer examples of this abuse.

56. In the present case he was adamant that the plaintiff had been in breach of Articles 7, 27 and 28.  

57. The main problem had been the failure of the plaintiff to notify the Club of her return to Hong Kong.  Mr Egan was aware of the fact that the plaintiff had been in Hong Kong and that she had visited the Club on numerous occasions.

58. However, until he personally had been informed that the plaintiff had applied to become Life Absent Member, he had been unaware that she had acquired this status.

59. This being the case it had never occurred to him that the plaintiff might have been in breach of the Articles of Association of the Club. 

60. He surmised that other office bearers in the Club would in all probability be in a similar situation to himself as it would not normally occur to them when they saw another member that they might be in breach of the Articles of Association of the Club.  Also it would almost invariably be the case that they would be unaware that the member might have applied to be a Life Absent Member.

61. What he went on to say was that it was impractible for the Club to police this type of abuse and that was the main rationale of clearly imposing upon the member the responsibility of informing the Club of their return to Hong Kong.

62. Also it was clear from the Articles that it was incumbent upon members to formally advise the Board of Governors of any change of status.

63. Mr Egan said that it was manifest from the information available to the Club that the plaintiff had been in breach of the Articles of Association and it was for this reason he had felt justified in advising his colleagues they could short circuit the provisions in the Articles relating to disciplinary proceedings.

64. It may be of assistance at this juncture to set out the main Articles on this subject :

“14.   If any Member violates the Articles of Association or By-Laws of the Club or if his conduct shall, in the opinion of the Board, be injurious to the character or interests of the Club, the Board shall consider the case.

15.     When any Member has been accused of any of the aforesaid matters, a meeting of the Board shall be convened of which not less than seven clear days’ notice by registered post shall be given to the Member concerned, informing him of the charge against him, of the intention of the Board to hold such a meeting to inquire into the charge and of his right to be present at such meeting and to adduce evidence and address the Board in his own defense.

16.     If within 15 minutes after the time for which the meeting was called such Member shall not appear at the meeting, the Board may in his absence hear the evidence against him and may decide upon the matter as it sees fit.

17.     Following such meeting, the Board shall have power to decide that such Member has forfeited his right to Membership of the Club, whereupon it shall direct that the Member’s name shall be deleted from the List of Members and with effect from such deletion he shall cease to be a Member.  The Board shall also have power to reprimand such Member and to suspend the privileges of such Member for such period as it thinks fit.

18.     Written notification of any decision of the Board shall be sent to the Member concerned by registered post.

19.     Any Member expelled from Membership of the Club shall be entitled to appeal against such expulsion to a meeting of the Club convened for such purpose.  Notice of appeal shall be given by such Member in writing to the Board within 14 days of the posting to him of the decision of the Board to expel him and thereupon the Board shall convene a general meeting of the Club within 14 days.  The Board shall in any event review any decision to expel any Member upon the written request of at least six Correspondent Members.

20.     Pending an appeal or pending a review of its decision by the Board, a Member affected by a decision to expel him shall not enjoy the privileges of Membership unless and until any such appeal or review is decided in his favour.”

65. A further reason given by Mr Egan for not complying with the Articles of Association was that he considered it to be important to take immediate action.

66. The Club had been taken completely unaware by the plaintiff’s contention that she enjoyed two classes of membership and they were not sure what she intended to do.

67. This had all happened very shortly after Mr Nedderman’s suspension and Mr Egan feared that the plaintiff would endeavour to reactivate her associate membership and then apply to the Club for spouse rights to be accorded to Mr Nedderman, the effect of which would negate the disciplinary action which had been taken against him.

68. I do not think that this is a very convincing reason for the haste.

69. Mr Egan agreed that a discretion is reposed in the Club to refuse an application from a member to confer spouse rights on any person.

70. If an application was made by the plaintiff for these rights to be conferred upon Mr Nedderman, the Club could simply refuse the application.

71. The part of Mr Egan’s evidence which I found to be convincing was his evidence in relation to the knowledge he and his colleagues would have had concerning the plaintiff’s membership status and the fact that she had clearly attended at the Club premises on numerous occasions.

72. I accept that he and his colleagues would understandably not connect her presence with the fact that she was a Life Absent Member unless their attention was specifically drawn to this fact. 

73. I also agree with Mr Egan that it was not unreasonable for the Club to place reliance upon members to comply with the Articles of Association and that there was undoubtedly an obligation placed upon members who had taken advantage of the provision relating to Absent Members to report to the Club when they returned to Hong Kong.

74. The fact that there was a note on the application form to the effect that if a member signed a chit this would automatically reactivate their accounts in no way reduces the obligation to report their return.  Apparently the reason for this note was to provide for a situation where a member was returning to Hong Kong for a very short period and provision was made for them to use the Club’s facilities by purchasing chits which could be used. 

75. The purpose of the note was to provide a warning to such members that signing a chit would activate their accounts.

76. Where I found myself in disagreement with Mr Egan was in respect of the advice he gave to his colleagues in relation to the disciplinary proceedings taken against the plaintiff.

77. Mr Egan’s advice that the normal procedures could be waived as this was clearly an open and shut case was undoubtedly in my view mistaken advice.

78. The question as to whether the plaintiff had abused the life absent membership provisions might well be described as being an open and shut case.

79. However, this was only half of the situation which needed to be addressed by the Disciplinary Committee.

80. There was also the question of the back payment of subscriptions which the Club subsequently were contending to be payable by the plaintiff.

81. Had the correct procedure been adopted and the plaintiff been afforded an opportunity of making representations to the Committee, she would have been able to advance powerful mitigating factors.

82. The first and most obvious being that if she had complied with the Articles of Association, she could nonetheless have continued to enjoy the privileges of the Club by virtue of the spouse membership she derived from her husband Mr Nedderman.

83. This being the case, it was arguable that the Club would not in reality have suffered any significant financial loss.

84. The benefit she derived from maintaining her membership rights were not of any great monetary value.

85. The other mitigation she could have advanced would have been the fact that this whole problem had come to light as a result of her disclosing to the Club that she also enjoyed Life Absent Membership.

86. It is certainly not possible to say that this mitigation would have found merit with the Committee.  Equally it cannot be said that these arguments inevitably might not have had some bearing in relation to the monetary claim which the Club contemplated making against the plaintiff. 

87. Like Mr Ushiyama Mr Egan strongly denied acting in bad faith towards the plaintiff.

88. I have come to the conclusion that Mr Egan was a truthful witness and I am not prepared to conclude that the Club acted in bad faith towards the plaintiff.

89. The final witness to give evidence for the Club was Mr Robert Sanders who was the general manager at the time when the plaintiff applied to the Club to become a Life Absent Member.

90. He totally rejected that any conversation of the nature claimed by the plaintiff ever took place.

91. He pointed out the obvious fact that he had only been an employee of the Club and he would have lacked any authority to give the assurances claimed.

92. Had the plaintiff approached him in the manner claimed, he would have advised her that she would have to take the matter up with the Board of Governors.

93. I believe that Mr Sanders was an honest witness and where there is conflict between his evidence and the plaintiff’s I much prefer his.

94. I have no doubt that the rules of natural justice have to be complied with. 

95. The Articles on this subject copied earlier in this judgment clearly set out a code which if adhered to does meet the requirements of natural justice.

96. On the virtually unchallenged evidence, the plaintiff was not served with a notice setting out the nature of the allegations being made against her and perhaps more importantly was afforded no opportunity of making representations to the Disciplinary Committee prior to their making their determination.

97. Mr Cheuk for the plaintiff drew my attention to a number of cases where the courts have upheld the necessity of adhering to the rules of natural justice.

98. Perhaps this is best expressed by Megary J at 397 of John v. Rees (1970) 1 Ch 345 :

“        Burn’s case concerned a trade union.  A rule required the executive committee of the union to ‘take every means to secure the observance of the union’s rules,’ and authorised it to ‘suspend, expel and prosecute’ members, and to ‘remove any incompetent or insubordinate officer.’  The committee passed a resolution removing the plaintiff from any office held by him, and preventing him from holding any delegation on behalf of the union for five years.  The plaintiff had been treasurer of his branch, and was chairman of it at the date of the resolution.  The complaint against him related solely to his conduct as treasurer; and the resolution was passed without hearing the plaintiff or giving him any opportunity of explaining.  P. O. Lawrence J. construed the rules strictly, and held that the language of the rule did not authorise the resolution that was passed.  He went on to consider the position if he were wrong in thus construing the rules, and said at p.374,: ‘I have no hesitation in holding that the power to suspend or expel a member for acting contrary to the rules is one of a quasi-judicial nature’; and he accordingly held the resolution bad because the plaintiff had not been given an opportunity of being heard in his defence.  In relation to the rules of natural justice Lawrence J. thus made no distinction between suspension and expulsion.  I would respectfully concur: in essence, suspension is merely expulsion pro tanto.  Each is penal, and each deprives the member concerned of the enjoyment of his rights of membership or office.  Accordingly, in my judgment the rules of mutual justice prima facie apply to any such process of suspension in the same way that they apply to expulsion.

…”

                   and at 402 :

“        It may be that there are some who would decry the importance which the courts attach to the observance of the rules of natural justice.  ‘When something is obvious,’ they may say, ‘why force everybody to go through the tiresome waste of time involved in framing charges and giving an opportunity to be heard?  The result is obvious from the start.’  Those who take this view do not, I think, do themselves justice.  As everybody who has anything to do with the law well knows, the path of the law is strewn with examples of open and shut cases which, somehow, were not; of unanswerable charges which, in the event, were completely answered; of inexplicable conduct which was fully explained; of fixed and unalterable determinations that, by discussion, suffered a change.  Nor are those with any knowledge of human nature who pause to think for a moment likely to underestimate the feelings of resentment of those who find that a decision against them has been made without their being afforded any opportunity to influence the course of events.”

99. Mr Cheuk submitted that the rules of natural justice clearly required that the plaintiff should have been given the benefit of the provisions contained in the Articles of Association and that the failure of the Club to adhere to these provisions meant that the requirements of natural justice had not been met.  These observations applied equally to both of the disciplinary proceedings.

100. Mr Bell argued that there had been a copious exchange of correspondence and that the Club had been fully appraised of the contentions being advanced by the plaintiff.

101. I do not think that this sufficiently meets the situation which prevailed for the reasons I outlined when commenting upon Mr Egan’s evidence.

102. As a fall back position Mr Bell placed heavy reliance upon the judgment of Pennycuick VC at p.496 of Glynn v. Keele University (1971) 1 WLR 487 :

“        I have, again after considerable hesitation, reached the conclusion that in this case I ought to exercise my discretion by not granting an injunction.  I recognise that this particular discretion should be very sparingly exercised in that sense where there has been some failure in natural justice.  On the other hand, it certainly should be exercised in that sense in an appropriate case, and I think this is such a case.  There is no question of fact involved, as I have already said.  I must plainly proceed on the footing that the plaintiff was one of the individuals concerned.  There is no doubt that the offence was one of a kind which merited a severe penalty according to any standards current even today.  I have no doubt that the sentence of exclusion of residence in the campus was a proper penalty in respect of that offence.  Nor has the plaintiff in his evidence put forward any specific justification for what he did.  So the position would have been that if the vice-chancellor had accorded him a hearing before making his decision, all that he, or anyone on his behalf, could have done would have been to put forward some plea by way of mitigation.  I do not disregard the importance of such a plea in an appropriate case, but I do not think the mere fact he was deprived of throwing himself on the mercy of the vice-chancellor in that way is sufficient to justify setting aside a decision which was intrinsically a perfectly proper one.

          In all the circumstances, I have come to the conclusion that the plaintiff has suffered no injustice, and that I ought not to accede to the present motion.”

103. Mr Bell also referred me to Lam Ping Cheung Andrew v. Law Society of Hong Kong (2007) 1 HKC 123.  The facts of that case were so different from the present case that it is difficult to obtain much assistance from it. 

104. In my judgment, the circumstances of the present case do not justify a departure from the rules of natural justice or the non-compliance with the Articles of Association.

105. This then leads to the final point made by Mr Bell namely that I should primarily direct my attention to the hearing on 23 July 2005 in relation to the termination of the plaintiff’s membership rather than the earlier decision made on 22 March 2005 relating to her suspension.

106. The argument he advanced in support of this contention was that an account had been rendered to the plaintiff in respect of moneys due and owing to the Club and that it was evident from a perusal of the relevant article on this subject that a member ceased to be a member if the account was not settled within 30 days.  Article 59 reads :

59.         “Notwithstanding anything contained in Article 54, the Board may at any time as it sees fit, present for payment to any Member his account, and if the person concerned fails to pay such account within thirty days of presentation of such account, he shall ipso facto cease to be a Member of the Club.”

107. On the face of it, it may appear that this article offends the rules of natural justice.

108. However it may be the case that it is saved by what amounts to a safety net in Article 61 which reads :

“61.   The Board may at its discretion reinstate any person who has been suspended or has ceased to be a Member by virtue of Article 58 or 59 as the case may be.”

109. I do not think that the problem is resolved as easily as that.

110. It is evident to me that Article 59 is designed to meet the situation of a member who has failed to pay his or her Club bill simpliciter.

111. Such a situation should not warrant the elaborate procedures laid down for determining whether a member has been guilty of some moral turpitude.

112. In this case, it definitely was not a simple matter of presenting a bill for payment.

113. Here, there is a dispute between the parties as to whether the amount is in fact due and payable and it would be artificial in the extreme to attempt to resolve the outstanding issues between the parties in what amounts to being a summary process.

114. This leads on to what should be done in respect of the defendant’s counterclaim for $74,105 representing the subscriptions which were payable by the plaintiff for the period she was in Hong Kong after her return from Australia and prior to her suspension as a member.

115. As I have indicated earlier this is hotly disputed.

116. The plaintiff was not given an opportunity of putting forward representations at either of the so-called disciplinary proceedings.

117. However she has had ample opportunity of canvassing the matter before me.

118. Perhaps understandably she has maintained her stance that she was justified in what she did and that she did give constructive notice to the Club of her return in March 1999.

119. In this judgment, I have found against her on these issues. 

120. Clearly, it is the case under the Articles of Association that an Absent Member must give notice of their return whereupon subscriptions will again become payable.

121. It is undisputed that she did return and I have no doubt in such a case that from that time on her subscriptions became payable.

122. Accordingly I order that the plaintiff must pay to the Club the amount claimed in the counterclaim.  Mr Cheuk submitted that some of the moneys were time barred.  As was pointed out by Mr Bell the plaintiff concealed her membership and this being the case time does not run.  I agree.

123. At this stage it is necessary for me to summarise my conclusions by reference to the claims and counterclaims made by the parties :

(1)     I find as a fact that the plaintiff did not have a conversation with Mr Sanders as claimed before proceeding to Australia in 1998.

(2)     I find as a fact that the plaintiff did not give the Club notice of her return to Hong Kong as was required by the Articles of Association.

(3)     On the evidence I am not satisfied that the Club either waived or has been estopped from maintaining that they had no notice of the plaintiff’s return.  The mere fact that the plaintiff was seen by various office holders at the Club premises does not mean that they were aware that she had abused the Absent Member article.  There was no reason to suppose that these members would have been aware that the plaintiff was at the relevant times an Absent Member.

(4)     I am satisfied that the procedures undertaken by the Club in relation to the hearings on 19 March and 23 July 2005 did not comply either with the Articles of Association nor were they in conformity with the rules of natural justice.

(5)     Neither the correspondence exchanged between the parties nor the type of situations envisaged by Pennycuick VC in Glynn v. Keele University could rectify the failure of the Club to comply with the rules of natural justice.

(6)     I make a declaration that the Club was in violation of the Articles of Association and the rules of natural justice and accordingly their determinations were of no legal effect.

(7)     I am not prepared to direct that the Club reinstate the plaintiff’s membership.

          Prior to the hearing on 23 July 2005, the plaintiff was an Absent Member.  It is common ground that she was not absent at that time.  She was present in Hong Kong.  As she was not an Absent Member I should not reinstate her as such.  A further reason for not reinstating her is her apparent unwillingness to pay the monthly subscriptions.

(8)     For the reasons given I allow the Club’s counterclaim.

(9)     It is not necessary to make an adjudication upon whether the plaintiff had clean hands. 

(10)   Costs :  I make an order nisi that there will be no order for costs.

124. The rationale for this is that this whole mischief would never have occurred if the plaintiff had given notice to the Club on her return from Australia.

125. However, the failure of the Club to adhere to the Articles of Association for the disciplinary proceedings was in no way the fault of the plaintiff.  Here the fault lies with the Club.

126. Taking these factors into account in my view the fairest order to make on the material before me is that there should be no order for costs.  Also there is no need to vary any order for costs made earlier in this litigation.  I also have made no order for costs on the counterclaim.