THE LUTHERAN CHURCH - HONG KONG SYNOD LTD. v. CHUNG BUN WING AND OTHERS

HCMP261/2000

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 261 OF 2000

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J U D G M E N T

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1. The plaintiff is the Lutheran Church - Hong Kong Synod Limited ("the Church"). It seeks declarations that the various defendants have ceased to be managers or supervisors of various Lutheran schools and injunctions against their acting as such.

THE BACKGROUND

2. The Church operates a number of schools in Hong Kong. Each school has a management committee and a supervisor. In 1995, the Church appointed the defendants as members of the management committees of its Lui Cheung Kwong Lutheran Kindergarten, Primary School, College and Evening College. They were appointed in different combinations but the 1st defendant was appointed to all the committees. He was appointed as supervisor of three of the schools and the 2nd defendant was appointed as supervisor of one of them. There is no dispute as to the validity of their appointments, and in fact some of these were re-appointments. The defendants were registered with the Education Department as members of the management committees of the schools. Those who were appointed as supervisors were approved as such by the Education Department.

3. In 1998, following meetings of the Education Committee, Executive Counsel and General Conference of the Church, the defendants were not appointed as members of the management committees of the relevant schools for the period of 1998 to 2001. The General Conference, on 18 April 1998, purported to appoint other persons in their place.

4. It is the plaintiff's case that the defendants were all appointed in 1995 for a term of three years, and that their appointments expired on 1 October 1998 by effluxion of time. That is the end of the matter. If, as the defendants say but which is disputed, the new appointments of supervisors and managers made in 1998 were invalid, this is simply irrelevant.

5. It is the defendants' case that the defendants' appointments do not expire by effluxion of time. They were under no duty to resign at the end of their three-year term of office. They hold office unless and until their registrations as managers are cancelled or their approvals as supervisors are withdrawn by the Director of Education. The new appointments which the plaintiff purported to make in 1998 are invalid, because the meeting of the General Council which purported to approve them did not have or could not be shown to have a quorum. There was a naked plan in 1998 to expel the defendants. That is shown by the changes which that same meeting purported to make to the Articles of Association in relation to the terms of office of managers and supervisors.

6. It is necessary first to consider the effluxion of time issue. If the appointments expired by effluxion of time, then that is indeed the end of the matter. This depends on the interpretation of the statutory scheme for managers and supervisors and the Church's scheme for appointing them as it stood in 1995.

THE STATUTORY SCHEME FOR MANAGERS AND SUPERVISORS

Managers

7. By section 3 of the Education Ordinance, Cap.279 ("the Ordinance"), it is provided that :

"... 'manager' means a person who manages or takes any part in the management of -

(a) a school; or

(b) the activities of the pupils of a school."

By section 32 of the Ordinance, every school is to be managed by its management committee which is defined as the registered managers of the school. By section 33, the management committee is responsible for ensuring that the school is managed satisfactorily, that the education of the pupils is promoted in a proper manner and that the Ordinance is complied with.

8. By section 8 of the Ordinance, the Director of Education is required to maintain a register of managers and by section 27, no person shall act as a manager of a school unless he is registered as a manager of the school. Section 30 provides the grounds on which the Director may refuse to register an applicant as a manager and further provides :-

"...

(2) The Director shall refuse to register an applicant as a manager of a school if it appears to the Director that the applicant is not acceptable as a manager of the school to the majority of the management committee."

Section 31 provides the grounds on which the Director may cancel the registration of a manager of a school. In particular, he may do so by subsection 1(c), if it appears to him that the person has ceased to be a manager, or cannot perform satisfactorily, or is not performing satisfactorily the duties of a manager. The section further provides :-

"...

(2) The Director shall cancel the registration of a manager of a school-

(a) if it appears to him that the manager is no longer acceptable as a manager of the school to the majority of the management committee; or

(b) at the written request of the manager."

9. Section 41 gives the Director power to appoint a manager or managers if it appears to him :-

"(a) that a school is not being managed satisfactorily or that the education of the pupils is not being promoted in a proper manner;

(b) that the composition of the management committee of a school is such that the school is not likely to be managed satisfactorily, or is such that the education of the pupils is not likely to be promoted in a proper manner; or

(c) that for any reason a school has no manager."

Supervisors

10. The duties of a supervisor are set out in section 39 and are primarily to correspond with the Director concerning the management of the school. The Director shall, by section 34, approve the first supervisor recommended by the applicant for registration of the school and shall approve further supervisors in the circumstances set out in section 38. A supervisor must be a registered manager, and holds office until he ceases to be a registered manager or resigns, or his approval is withdrawn. One of the grounds for withdrawal of approval is that the supervisor is no longer acceptable as such to the majority of the members of the management committee.

THE CHURCH'S SYSTEM OF APPOINTMENTS OF MANAGERS AND SUPERVISORS

11. The Articles of Association of the Church, as they stood in 1995, provided as follows :-

"Schools of the Synod

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51. Schools operated in the name of the Synod belong to the Synod. The supervisor and all members of the Management Committee of each of these schools are elected by the Education Committee of the Synod and approved by the General Conference. When the General Conference is not in session, this approval is given by the Executive Council. The removal or dismissal of the supervisor and any member of the Management Committee will follow the same procedure.

52. Management Committee of Synodical Schools

(a) The Executive Council shall nominate for each school established or carried on by the Synod a management committee whose members shall be appointed for a term of three years but they shall be eligible for re-election, and such nominees shall make application to the Director of Education for registration as managers under the provisions of the Education Ordinance.

(b) The Executive Council with the agreement of the majority of the members of a school management committee may remove or dismiss a member of a management committee from office and any member so removed or dismissed and any member whose term of office has expired and has not been renewed or extended by the Executive Council and the majority of the members of the school management committee shall forthwith tender his resignation in writing to the Director of Education as a registered manager under the Education Ordinance.

(c) The Executive Council with the agreement of the majority of the members of a school management committee shall nominate another member to replace a number of a management committee who has been removed or dismissed with the agreement of the majority of the members of a school management committee or whose term of office has expired, and such nominee shall make application to the Director of Education for registration as a manager under the provisions of the Education Ordinance.

...

53. Supervisors of Synodical Schools

(a) The Executive Council with the agreement of the majority of the members of a school management committee nominates a member of the school management committee to be the supervisor of the school for a term of three years, but he shall be eligible for re-election, for which he is to hold such office and thereupon the school management committee shall recommend such person to the Director of Education for his approval in accordance with the Education Ordinance.

(b) The Executive Council with the agreement of the majority of the members of a school management committee may remove or dismiss a supervisor from office and any supervisor so removed or dismissed or whose term of office has expired and has not been renewed or extended by the Executive Council and the majority of the members of a school management committee shall tender forthwith his resignation in writing to the Director of Education as an approved supervisor under the Education Ordinance.

(c) The Executive Council with the agreement of the majority of the members of a school management committee shall nominate another supervisor to replace one who has been removed or dismissed or whose term of office has expired and thereupon the school management committee shall recommend such person to the Director of Education for his approval in accordance with the Education Ordinance."

EVIDENCE

12. All the evidence is by affidavit. There is no real dispute on the facts. After the General Conference of 1998, there was correspondence between the parties and with the Education Department. The latter seems to have taken the line that the parties should settle the matter among themselves. The defendants remain registered as managers and approved as supervisors. They continue to act as such.

INTERPRETATION

13. The plaintiff seeks declarations that the defendants have ceased to be managers or supervisors of the various schools. It does not seek a declaration that they have ceased to be registered managers. It seems to me that the arguments about registration and approval and the tenure of office of a manager or a supervisor under the statutory scheme miss this point.

14. The appointment of managers and supervisors is a matter between the Church and those whom it appoints. That appointment must be done in terms of Articles 51 and 52 of the Articles of Association of the Church. If it is so done, it is valid.

15. Registration is not an appointment or a ratification of appointment; it is simply the obtaining of a statutory licence for the person appointed to act in the office of his appointment. The Director has no power of appointment save under section 41 in the restricted circumstances where there is no manager or no satisfactory management.

16. To hold that a manager must hold office until his registration is cancelled under section 30 or section 31 would produce the result of taking away the Church's right of appointment and dismissal of its school managers, and giving it to the Director. This would be absurd, particularly in the light of section 41.

17. Articles 52 and 53 clearly provide for a three-year term of office with eligibility for re-election. I take that to mean that there is no objection to a person's being elected by the Education Committee (as provided by Article 51) for a further term of office.

18. The Articles provide for removal or dismissal of a member by the Executive Council with the agreement of the majority of the members of the school management committee, but they do not require any positive step to remove or dismiss a member at the end of his three-year term.

19. There are provisions in item 2 of both Articles which require a member whose term of office has expired and has not been renewed or extended by the Executive Council and the majority of the members of the school management committee to resign forthwith. One may ask what is the need for a resignation if the term of office has expired. At the same time, however, it seems to me that the only circumstance in which a resignation would not be required is that in which the member's term of office has been renewed or extended by the Executive Council and the majority of the members of the school management committee.

CONCLUSION

20. I conclude that the effect of the Articles is that a member is appointed for three years. He may be re-elected or have his appointment renewed or extended by the Executive Council, but these require positive decisions and resolutions. If those decisions and resolutions are not taken, then the appointment lapses by effluxion of time.

21. In fact, the defendants were not re-elected by the Education Committee. Their terms were not renewed or extended by the Executive Council. The result is that they no longer have any right to manage or take part in the management of the relevant schools. They may still be licensed by the Director to manage the schools, but this cannot give them a right against the Church as owner of the schools (see Article 51) which they do not now possess.

22. It is not necessary for me to consider whether the appointments of others in 1998 were valid or not, or whether or not they, or indeed the amendments to the Articles, are in breach of the Statement of Policies.

23. Since the defendants have no right to act as managers or supervisors of the school under the Articles of Association, the plaintiff must succeed. There will be judgment in terms of Items 1 to 16 of the orders and reliefs sought in the Originating Summons. Parties have liberty to apply for any consequential directions and inquiries which may be required. Costs nisi be to the plaintiff, to be taxed if not agreed.