Ms Walker was unable to establish any one of the three grounds which would justify the Court to intervene in the Selection Committee ’ s decision making process , and so the Court refused her application .
In this case , because the Court decided that the Protocol did not have contractual effect , Ms Walker was left to argue that her livelihood or reputation was damaged by the Selection Committee ’ s refusal to consider her application . This was a difficult proposition and one which she ultimately failed to prove .
If the Protocol had been held to have contractual effect between the Association and its members , a different outcome may have resulted . This is because a breach of contract , not requiring proof of damage , is easier to establish .
This case is a timely reminder for Clubs to adhere to the letter of their constitutions when making decisions which may affect the rights or interests of its members , because the constitution is treated as a contract between the Club and its members .
Tracing the thief
Clubs operating large cash businesses are often the victims of fraudsters . If these situations arise , clubs should devote as much time and resources to dealing with it as soon as possible due to the difficulty of tracing lost monies .
A recent decision of the NSW Court of Appeal in Fistar v Riverwood Legion & Community Club Ltd [ 2016 ] NSWCA 81 confirmed that there are many overlapping claims available to victims of fraud against the recipient of stolen property . The Court of Appeal held that where money had been stolen it is held on trust for the victim of the theft , even in the hands of the thief , and is recoverable and traceable as trust money . The Court of Appeal observed that there are a variety of remedies available to fraud victims and the fact that they overlapped did not oust one in favour of another .
In this case , an employee had stolen from the Club and given it to a fraudster who used the money to partially discharge a debt to a third party , Ms Fistar . As the ultimate recipient was actually owed a debt and was unaware of the fraud , the Club was unsuccessful in pursuing the stolen monies from her . Despite the prompt and diligent steps taken by the Club , the Court found that it could not impose on Ms Fistar who was innocent of the fraud and in the court ’ s opinion , genuinely owed money by the fraudster . Had she received the money as a volunteer , that is as a gift , then a different result may have been obtained .
Sylvia Fernandez , Partner , and Jodi Walkom and Nicholas Riordan , Senior Associates work in the Litigation and Dispute Resolution Group of Thomson Geer ’ s Sydney office .
“ Clubs should be wary of how damaging disputes at an executive level can become .”
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