Lee Chuen Li and Another v Singapore Island Country Club

• Jurisdiction: Singapore
• Judgment Date: 15 June 1992
• Date: 15 June 1992
• Docket Number: Suit No 2364 of 1991
• Court: High Court (Singapore)

Lee Chuen Li and another

Plaintiff

and

Singapore Island Country Club

Defendant

[1992] SGHC 165

Michael Hwang JC

Suit No 2364 of 1991

High Court

Administrative Law–Natural justice–Club members did not pay subscriptions as required–Membership of some members terminated but not others–Whether discriminatory treatment of members violate natural justice–Equity–Relief–Against forfeiture–Whether club membership gives possessory or proprietary rights–Grounds justifying relief against forfeiture–Unincorporated Associations and Trade Unions–Friendly societies–Membership–Members' club–Termination of membership owing to non-payment of subscriptions under club rules–Whether member has right to notice–Whether certain procedures ought to have been complied with before termination of membership

The defendant was a members' club (“the club”). The two plaintiffs were members of the club whose membership was terminated on grounds that they were in arrears of absent members' subscription for more than one year and had, under r 23 (c) of the club rules, automatically ceased to be members. When the plaintiffs learnt of their loss of membership they immediately appealed to the general committee for reinstatement, but these appeals were rejected. After further unsuccessful requests to the committee of the club (“the general committee”), the plaintiffs then commenced these proceedings, arguing that: (a) they had a right to be billed for their subscriptions and no bills were received by them, and that the club failed to comply with the procedures laid down in rr 47 (c), (e) and (f) before terminating their membership; (b) the rules were not equally administered and the plaintiffs were discriminated against as 14 other absent members had been reinstated but not the plaintiffs, violating the principles of equality before the law and equal protection of the law under Art 12 (1) of the Constitution, and a breach of natural justice; (c) termination of their membership was akin to a forfeiture for non-payment of rent under a contract in that they would lose their proprietary/possessory rights acquired through their membership with the club.

Held, dismissing the claims:

(1) As a matter of law, the club was not required to send bills or reminders to members who had not paid their monthly subscriptions. Such members were debtors of the club in respect of their subscription, and a bill would have been no more than a demand for payment. The provisions of r 47 were optional in the sense that the general committee may or may not invoke them to enforce payment of subscriptions, and need not be observed before r 23 (c) applied: at [16] and [17].

(2) While the principles of natural justice must apply to the expulsion of a member from a club, r 23 (c) was not a rule dealing with expulsion of members. At common law, a member who did not pay his subscriptions for an inordinate time would be deemed to have resigned by inertia. The question of expulsion was completely separate from that of whether a member could be deemed to have resigned by virtue of his conduct; expulsion required a positive act by the club. The deletion of members' names from the register of members did not amount to an expulsion but mere recognition of a legal fact. As the club had nothing to do with the cessation of the plaintiffs' membership, its act in allowing ex-absent members to continue their membership in disregard of r 23 (c) did not amount to a waiver of the plaintiffs' cessation of membership under the same rule: at [36] to [37].

(3) Rule 23 (c) may be treated as a forfeiture clause, and this enables members losing their membership under the rule to apply to court for relief against forfeiture. Relief against forfeiture would be granted only if: it was possible to state that the object of the transaction and of the insertion of the right to forfeit was essentially to secure the payment of money; or there were the heads of fraud, accident, mistake or surprise in the forfeiting; or the conduct of the forfeiting party could be classified as unconscionable or equitable. Rule 23 (c) could not be characterised as merely a security for payment of subscriptions as the rule could well be explained on the basis that the members considered an absent member who neglected to pay his subscription for more than a year to be unworthy of membership; it was not analogous to forfeiture of a lease for non-payment of rent because the relationship of landlord and tenant was a bilateral one whereas membership of a club was a multilateral one, and stricter considerations had to apply where the interests of many parties were affected. The heads of fraud, accident, mistake or surprise did not extend to mere inadvertence, as in the present case. The concepts of unconscionability and inequity did not apply in this case because the plaintiffs had failed to make inquiries of the club when they did not receive their bills, and thus could not complain of unconscionability or inequity: at [42], [45] and [51], [54] to [61], [68], [70], and [77] to [78].

Abbatt v Treasury Solicitor [1969] 1 WLR 1575; [1969] 3 All ER 1175 (refd)

Barrow v Isaacs & Son [1891] 1 QB 417 (folld)

BICC plc v Burndy Corp [1985] Ch 232; [1985] 1 All ER 417 (refd)

Chee Wor Lok v Yeoh Saw Geok [1935] AC 69; [1935] MLJ 73 (folld)

Finch v Oake [1896] 1 Ch 409 (refd)

Gill v Lewis [1956] 2 QB 1 (refd)

GKN Bolts and Nuts Ltd Birmingham Works Sports and Social Club, In re [1982] 1 WLR 774; [1982] 2 All ER 855 (refd)

Harold Wood Brick Co Ltd v Ferris [1935] 2 KB 198 (refd)

John v Rees [1970] Ch 345 (refd)

Ladup Ltd v Williams & Glyn's Bank plc [1985] 1 WLR 851; [1985] 2 All ER 577 (refd)

Lee v Showmen's Guild of Great Britain [1952] 2 QB 329; [1952] 1 All ER 1175 (refd)

Legione v Hateley (1983) 152 CLR 406 (refd)

Levy's Trusts, Re (1885) 30 Ch D 119 (refd)

Millar v Smith [1953] NZLR 1049 (folld)

R v The Mayor and Town Council of Wigan (1885) 14 QBD 908 (refd)

Raineri v Miles [1981] AC 1050; [1980] 2 All ER 145 (refd)

Ronnie Lee Seng Choon v Singapore Island Country Club [1992] SGHC 7 (refd)

Scandinavian Trading Tanker Co AB v Flota Petrolera Ecuatoriana; The Scaptrade [1983] 2 AC 694 (refd)

Schweikert v Burnell [1963] NSWR 821 (refd)

Shiloh Spinners Ltd v Harding [1973] AC 691; [1973] 1 All ER 90 (folld)

Sick and Funeral Society of St John's Sunday School, Golcar, In re [1973] Ch 51 (refd)

Sport International Bussum BV v Inter-Footwear Ltd [1984] 1 WLR 776; [1984] 2 All ER 321 (refd)

Sumner's Settled Estates, Re [1911] 1 Ch 315 (refd)

Tian Teck Construction Pte Ltd v Exklusiv Auto Pte Ltd [1992] 1 SLR (R) 948; [1992] 2 SLR 390 (refd)

United Scientific Holdings Ltd v Burnley Borough Council [1978] AC 904; [1977] 2 WLR 806 (refd)

Civil Law Act (Cap 43,1988 Rev Ed)s 3

Constitution of the Republic of Singapore (1985Rev Ed) Art 12 (1)

Societies Act (Cap 311,1985 Rev Ed)

P Suppiah (P Suppiah & Co) for the plaintiffs

C R Rajah (Tan Rajah & Cheah) for the defendants.

Judgment reserved.

Michael Hwang JC

1 The defendant is a members' club and a society registered under the Societies Act (Cap 311). It operates a golf and country club with four 18-hole golf courses and all the recreational and social facilities expected of a top-flight club. In this judgment I will refer to the defendant as “the club” or “the defendant”. Counsel for both parties are aware that I am a member of the club and have raised no objection to my hearing the case on this ground.

2 This case arises from the purported termination of the absent membership of the two plaintiffs on the grounds that they have been in arrears of subscription for more than one year and have, under the rules of the club, automatically ceased to be members. The case has a practical and legal significance beyond the immediate interests of the parties to this action. As there are a large number of other absent members of the club who have been treated by the club as having ceased to be members for non-payment of subscriptions, the decision will to some extent be a test case for them. There are also broader issues involved which will have legal significance, not only for the club, but other members' clubs as well.

3 The facts leading to the termination of the membership concerned are similar (although not identical) in the case of both plaintiffs. Both of them were ordinary members of the club. As they were resident outside Singapore at the time of their admission, they converted their ordinary membership to absent membership. As absent members, they were required to pay a subscription of $10 per month. It is not in dispute that each of the plaintiffs was in arrears of subscription for more than 12 months when their names were deleted from the club's register of members in May 1991. In the case of the first plaintiff, she was in arrears for about 23 months when her name was deleted. In the case of the second plaintiff, the period of arrears was about 15 months. The committee of the club (which I will refer to as “the general committee”) took the position that, under its rules, an absent member whose subscription has become overdue for more than 12 months automatically loses his membership, and accordingly, the plaintiffs had ceased to be members. When the plaintiffs learnt of their loss of membership, they immediately appealed to the general committee for reinstatement. The appeals were rejected on 5 October 1991. The plaintiffs were not content to let the matter rest there, and another member sympathetic to their cause asked the general committee to table certain resolutions before an extraordinary general meeting of the club which was due to take place on 7 November 1991 in order to restore their membership. The general committee refused to do this as the extraordinary general meeting was convened for the sole purpose of amending the rules of the club. Against this background, the plaintiffs filed their writ...