Evidence in Charles Robert Bray Knox v Fred Nile has shown that 60 per cent of the Party’s funds have been consumed in receivership and a series of expensive Supreme Court cases since May last year. This amounts to at least $300,000, most likely more.

Judgment has been reserved by Justice Black of the NSW Supreme Court after a two-day hearing this week.

If lawyer John Ferguson’s submissions are accepted, the CDP will be offered one last chance to move forward, with a meeting of all members. This will focus the Party members on choosing a new panel of officials tasked with rebuilding the Party processes. The Party’s unworkable constitution will need to be amended, probably at the meeting.

The Party has been described as “incapable of governing itself’” by two judges of the NSW Supreme Court during a series of hearings since May last year.

But Ferguson, appearing for Graeme Collins, a Party member who intervened in the case, pointed the court to a way out of the mess. The Party is paralysed because its constitution requires the election of a new board by branch delegates. There’s a fundamental disagreement over which branches are legitimate and an unrealistic 75 per cent vote by the Party’s state council meeting would be required.

CDP board unconstitutional for at least nine years

Justice Black observed this week that it is unlikely the board has been constitutionally elected for at least the past nine years. The Party has been in the habit of not following its own constitution.

Ferguson has possibly found a way of turning the holes in the Party’s odd constitution to advantage. His submission pointed the court towards the Association Incorporation Act, and the model constitution set out in the regulations.

He argued that the model constitution’s rules could apply in the absence of provisions in the Party’s own constitution.

The model constitution provides for special general meetings, and Ferguson argued that this means the court could order one.

In the court hearing, Ferguson put the case that the Party has no board at present and no officers given the terms of the receivership. There being casual vacancies, a special meeting could appoint new officers.

Ferguson’s submission raised the issue of “reserve powers” of members of an association and the court’s jurisdiction to provide a remedy.

One of the ironies of the CDP court hearing is that a Buddhist Society dispute known as the Sengthong case could be critical – as a precedent for a court to explore alternatives when an association becomes deadlocked.

Possible outcomes for the case were listed by Justice Black. These included:

• Leaving the Party receiver in place and conducting a meeting
• Reducing the role of the receiver to save funds
• A winding-up order
• A suspended winding-up order giving the parties to the dispute time to find a solution
• the Nile group’s solution of returning the Party to them.

Court judgment likely to be prompt

This hearing was full of sudden twists in the arguments put forward by the parties, some of which drew attention from the bench.

Ferguson’s client, Graeme Collins, had previously wanted an election by delegates. The Nile group – the officeholders of the party – did not press their submission for an end to the receivership until a second lawyer, Peter King, took over. They too swung behind the Ferguson plan to the extent of submitting details of how to carry it out, including a postal vote.

One party looking on from outside, Lyle Shelton, a strong advocate of a postal vote all along, has reason to be both bemused and encouraged by the proceedings. This writer had the impression that Ferguson’s plan had caught the attention, or at least the tentative support, of several of the parties.

However, Justice Black was not succumbing to the optimism suggested by the receiver’s lawyer pointing out that there were hurdles:

• Who are the members?
• When would the meeting be held?
• What would be on the agenda?
• Does it really resolve the deadlock?

As the court rose at the end of the hearing, Justice Black commented that he did not expect his judgment to take long.