Chand v Nasinu Land Purchase Co-operative Ltd [2024] FJCT 2; COT 03 of 2021 (5 August 2024)

IN THE CO-OPERATIVE TRIBUNAL
CENTRAL DIVISION

COT 03 of 2021

BETWEEN:

PREM CHAND
COMPLAINANT

AND:
NASINU LAND PURCHASE CO-OPERATIVE LIMITED
COMPLAINEE

For the Complainant: Mr. Nair
For the Complainee: Mr. Singh

RULING

Background

1. The Complainant is a Retiree of Nasinu and was a member of the Complainee. The Complainant had his membership expelled under Section (9) of the Complainee’s By Laws. This was communicated by way of the Complainee’s letter to him dated 22^nd August 2018.
   
2. The Complainee is a duly registered cooperative based at 68 Suva Street, Suva. One of the primary objectives of the Complainee is to ensure that membership is dealt with according to the by-laws and Cooperative Act 1996.
   
3. The Complainant filed this application for referring a dispute to this Tribunal on 22^nd December 2021 (hereinafter referred to as “the application”).
   
4. The nature of the application is premised on membership and share. Basically, the Complainant claims that the Complainee unlawfully terminated his membership and board membership because he questioned one Yogesh Krishna on the way he transfer on lot to his mother in law who was not a member.
   
5. Both parties filed several affidavits with their annexures in support and written submissions in support of their respective positions. These affidavits are as follows:
   1. Affidavit of Satya Narayan dated 9^th December 2021.
   2. Affidavit of Satya Narayan (In Opposition to Prem Chand’s Claim) dated 17^th February 2022.
   100. Affidavit of Prem Chand in Reply to the Affidavit in Opposition dated 1^st March 2022.
   4. Affidavit in Reply of Satya Narayan (In Reply to Affidavit of Prem Chand filed on 01.03.22) dated 2^nd May 2022.
   5. Affidavit of Chief of Prem Chand dated 3^rd January 2023.
   6. Affidavit of Evidence in Chief of Satya Narayan dated 6^th January 2023.
   7. Submissions on behalf of the Complainee with List of Authorities dated 27^th January 2023.
   8. Submissions by Complainant (Prem Chand) dated 23^rd January 2023.
   9. Submissions by Complainant (Prem Chand) dated 12^th April 2024.
   10. Submissions on behalf of the Complainee dated 30^th April 2024.
       
6. During the hearing of this complaint, the Complainant called himself as a witness and the Complainee called Satya Narayan, the CEO of the Complainee. Both parties cross-examined each other’s witness respectively.
   
7. Both parties have filed written closing submissions for which the Tribunal is grateful for.
   

Complainant’s Submission

8. This Tribunal has considered all the evidence and submissions in support of the Complainant’s position. The following are some of the relevant features of the evidence and submissions.
   
   1. That his membership was terminated because he questioned how Yogesh Krishna fraudulently transferred one lot to his mother in law who is a non-member.
   2. That the Complainee relied on irrelevant factors or no reasons when arriving to the termination.
   100. That the Complainee was biased and was not independent in the process leading to the termination.
   4. That the Complainee denied him the opportunity to be heard in the process relating to the termination.
   5. That the Complainee accepted a fraudulent disciplinary report that was supposedly signed by one Vijendra Singh.
   6. That he seeks his membership to be reinstated and dividend be restored.
   7. That his membership was suspended vide a letter on 16^th March 2016. That since this suspension of his membership was deemed unlawful then the expulsion would be unlawful too.
   8. That he was not told of any appeal period and so that was unfair.
   9. That he filed an appeal to the Complainee on 18^th March 2016 but did not receive any response.

Complainee’s Submission

9. This Tribunal has also considered all the evidence and submissions in support of the Complainee’s position. The following are some of the salient features of the evidence and submissions.
   
   1. That the Complainant became a member of the Complainee in October 2011.
   2. That the Complainant’s claim that Yogesh Krishna committed fraud is false because Chandra Kali was entitled to the lot allocation based on the nomination/shares given by her late husband.
   100. That the Complainant defrauded the Complainee by acquiring 3 lots in the names of his son, Akash Chand, daughter in law, Karishma Kartika Chand and one Rajendra Prasad (the allegation). Due to this, the Complainee asked the Complainant to pay back the sum of $50,000, which he agreed to do. This was done in a board meeting on 12^th May 2016 and captured in the minutes of the said meeting.
   4. That the Complainant did pay the $50,000 by way of bank cheque on 23^rd June 2016. The actual copy of the bank cheque supports this. The Board then decided to suspend the Complainant during the AGM on 27^th July 2016 and that he was summoned by way of a letter dated 4^th August 2016 to attend the Board Meeting on 8^th September 2016 at 6pm so that the Board can hear the Complainant’s submissions on the issue. The suspension of course was declared unlawful but it did not take away the allegation against the Complainant.
   5. That the Complainant’s submissions were heard by the Board on 8^th September 2016 as confirmed by the minutes.
   6. That a Disciplinary Committee of 5 members was formed on 5^th May 2018 and on 28^th July 2018 convened a forum to analyse and make a finding regarding the Complainant’s fraudulent activity. The said committee found that the Complainant had full knowledge of all the transactions on the allocation of the lots in which case three lots were transferred to his family members. The allocation of lots was found to be ultimately questionable and so it was recommended that the Complainant’s membership be expelled with no rights and benefits under section 43 of the Cooperative Act.
   7. That the Complainant’s membership was terminated under Section (9) of the By –Laws which cited the Complainant as either dishonest or acted in contrary to the objectives of the cooperative or acted in a way that is seriously detrimental to the interests of the cooperative or failed in his duties as member.
      

Analysis

10. Section 115 of the Cooperative Act of 1996 (the Act)states:

(1) If a dispute concerning the by-laws, election of officers, conduct of meetings, management or business of a co-operative arises-

(a) among members, past members and persons claiming through members, past members and deceased members;

(b) between a member, past member or persons claiming through a deceased member, and the co-operative, its Board or any other officer of the co-operative;

(c) between the co-operative or its Board and any other officer of the co-operative;

(d) between the co-operative and any other co-operative,

such dispute may be referred, after due attempts to settle the issue by local informal mediators, to the Registrar or directly to the Co-operative Tribunal constituted under Section 116 of this Act for decision.

(emphasis added)

11. Before we delve into the gist of the analysis, it would be prudent to examine the Complainant’s assertion that the Tribunal should not consider the documents which the Complainee’s documents that were tendered into evidence. Section 10 of the Civil Evidence Act 2002 states:

Proof of statements contained in documents

10.-(1) If a statement contained in a document is admissible as evidence in civil proceedings, it may be proved-

(a) by the production of that document; or

(b) whether or not that document is still in existence, by the production of a copy of that document or the material part of it,

authenticated in a manner the court approves.

(2) It is immaterial for the purpose of this section how many extracts there are between a copy and the original.

In this matter, the Complainee’s witness produced the photocopy of the document. This is the basis of why such documents were admitted. As to the weight of such documents, the Tribunal noted in the course of the evidence that the Complainant himself identified the documents. Therefore, the Complainant’s submission that the Tribunal not consider the documents is misplaced. The Tribunal will consider all documents before it and will gives them significant weight.

12. The Complainant submits that the Complainee unlawfully terminated his membership while the Complainee says otherwise. Therefore, this application qualifies under section 115 of the Act as it is dispute between the Complainant who is a past member and the Complainee which is a Cooperative, on the management of its procedures involving the expulsion of the Complainant’s membership. The Complainant from the outset alleged that the Complainee expelled or terminated his membership just because he (the Complainant) had raised an issue regarding how a lot was transferred by Yogesh Krishna to his mother when she was not entitled to the same as she was not a member. Later, the Complainant has alleged other grounds on why he claims his membership was terminated including Paragraph 6 of his Affidavit of Evidence in Chief, which states that since the suspension of his membership was deemed unlawful then it should follow that his expulsion was unlawful. Therefore, the following will focus on the main grounds submitted by the Complainant and will look at the Complainee’s response to each; and then determine lawfulness of the same.
    
13. On the ground that the Complainant questioned how Yogesh Krishna fraudulently transferred one lot to his mother in law who is a non-member, there needs to be evidence to support this. As this Tribunal cited in Ajay Baby Prasad v NLPCL COT 22 of 2022, “regardless in whatever shape, manner of form, the general rule is that any allegation of fraud must be proved.” With respect, there is nothing before the Tribunal to substantiate his claim therefore, this ground has no merit.
    
14. There are several grounds of the Complainant’s position that correlate and so for purposes of clarity they will be addressed together. These grounds are that that the Complainee relied on irrelevant factors, was not given an opportunity to be heard and there were no reasons given in the expulsion letter. The other correlated grounds involve the claim that the Complainee was biased and was not independent and accepted a fraudulent disciplinary report that was supposedly signed by one Vijendra Singh. The final grounds are the unfair practices in the appeal process.

Irrelevant factors, No Opportunity to be Heard and No Reasons in Expulsion Letter

15. Section 43 of the Act states:

(1) The expulsion of a member may be ordered by the Board or by the General Meeting if a member carried out or attempted to carry out an act seriously detrimental to the co-operative or if he or she failed to respect any or all the duties stipulated in Section 39 of this Act.

(2) The procedure for expulsion of a member shall beset out in the by-laws and shall include:

(a) a period of notice of at least two months;

(b) a written notification thereof stating the reasons for the expulsion; and

(c) the member's right to defend himself or herself before the Board or the General Meeting prior to the decision.

(3) If the expulsion was decided by the Board, the expelled member may appeal to the next General Meeting whose decision shall be final: Provided that such appeal shall not suspend the effects of the decision.

(emphasis added)

16. The following are the relevant clauses of the By-Laws of the Complainee, which states:
    9. A member may be expelled for any action which is held by the Board and confirmed by a General Meeting to be dishonest or contrary to the stated objects of the co-operative or if a member carried out or attempted to carry out an act seriously detrimental to the cooperative or if he or she failed to respect any or all of the duties stipulated in Section 39 of the Co-operative Act.

10. The procedure for expulsion of a member shall include:

(a) a period of notice of at least two months;

(b) a written notification thereof stating the reasons for expulsion and;

(c) the members shall have the right to defend himself or herself before the Board or General Meeting prior to the decision.

11. If the expulsion was decided by the Board, the expelled member may appeal to the next General Meeting whose decision shall be final.
    
17. Before we continue, it is vital to note that both parties, the Complainant and the Complainee agree that the above mentioned By-Laws reflects the same spirit and content of section 43 of the Act.
    
18. So when arriving at the expulsion, the Complainee primarily relied on an alleged fraudulent act by the Complainant that is, by being dishonest and fraudulently transferring three (3) lots to persons two of whom are his children when the said three (3) persons were not entitled to them as the transferors of the said lots did not authorise the same. The said transferors had either passed away or migrated at the time of the transfer. This was the essence in the following meetings and correspondence:
    1. Meeting of the Board of Directors on 12^th May 2016 as captured in Exhibit D of the Complainee’s evidence, which shows Paragraph 12 of the Minutes of the meeting;
    2. Meeting of the Board of Directors on 8^th September 2016 as seen in Exhibit G of the Complainee’s evidence which shows Paragraph 12 of the Minutes of the meeting;
    100. Annual General Meeting on 5^th May 2018 as contained in Exhibit H of the Complainee’s evidence showing the minutes of the said meeting. To form a Disciplinary Committee investigating the allegation;
    4. Disciplinary report on 28^th July 2018 as contained in Exhibit J;
    5. Special General Meeting on 30^th July 2018 as per Exhibit K; and
    6. Letter from Complainee to Complainant on 22^nd August 2018 marked Exhibit L.
19. I find the content of all the said meetings and correspondence as not irrelevant factors. They contain focused discussions on the serious allegation against the Complainee. They are relevant factors that the Complainee considered at arriving at its decision to expel the Complainee’s membership.
    
20. I also find that the Complainant was given the opportunity to be heard or to exercise his right to defend himself. This is clear in the above Exhibits D and H. Also, had he disagreed to the allegation then he should have expressly stated that in Exhibits D and H. In fact he expressly states that the opposite, which is that he agrees to pay the $50,000.00, which is implied as the cost of the allegation. Further, the Complainant admits in his evidence page 20 of the Court Transcript:
    1. Question by Mr. Singh (Counsel for Complainee): Very well. Mr. Chand I put to you that as a result of that you caused loss to the Cooperative, the Cooperative has given a fair opportunity to hear your grievances. You agree with that?
    2. Answer by the Complainant: Yes, agreed.
       
21. Now as for whether the Complainee did give reasons of the expulsion to the Complainant in writing or otherwise, ideally the Complainee must spell out the reasons in the letter Exhibit L as the law requires “a written notification thereof stating the reasons for the expulsion.” Exhibit L shows:

“This is to inform you that during our SGM held on 30^th July 2018...you have been expelled from Nasinu Land Purchase & Housing Cooperative Membership as mentioned in the By-Laws (9).

A member may be expelled for any action which is held by the Board and confirmed by the General Meeting to be dishonest or contrary to the stated objects of the cooperative or if he or she failed to respect any or all the duties stipulated in Section 39 of the Co-operative Act.

The members present at the SGM unanimously agreed to the Disciplinary Committee’s decision.”

22. The Board issued this letter after an SGM, hence qualifies under section 43 of the Act. The Complainee’s assertion that the SGM is only limited to particular situations under the Act holds no weight as section 43 requires the Board as an authority which was what was done here.
    
23. Upon reading the letter, it refers to the applicable law as the reasons for expulsion in the Letter but it does not refer to the allegation or any other issue as the reason. One would reason that the allegation is the main reason that has been concluded as dishonest or contrary to the objectives of the cooperative or that the Complainant failed to carry out his duty under the law. But is it sufficient to put in just the law against the background that led to the expulsion for the Complainant to know why he was been expelled or would it be sufficient to have the exact reasons for expulsion.
    
24. Unfortunately, this was not raised in cross-examination by Counsel of the Complainant to the Complainee’s witness. Such is required under the Brown v Dunn (1893) 6 R 67 test as adopted in the case of Singh v Singh [2012] FJHC 957 (19 March 2012):

“The legal effect of failure by a party to challenge and contest in cross-examination a fact relied upon by its opponent is that the tribunal of fact could accept the fact as unchallenged and act upon, if the evidence on that fact is convincing.

Blackstone's Civil Practice: 2011: Oxford at page 888, states that:

...[c]ross-examination provides the other side the opportunity to test and seek to undermine the evidence given in chief. One of the main obligations of an advocate cross-examining a witness is to put his or her client's case. This means that the witness must be challenged and given an opportunity to comment on the points of conflict between the evidence he or she has given and the case being advanced by the cross-examining party. If this is not done, the court may decide that the witness's account is accepted. ..”

After perusing the evidence, the following is clear:

1. The Complainant did not adduce in evidence either orally or by way of Affidavit of Evidence in Chief of the Complainee not providing reasons of the expulsion as a ground of complaint;
2. The Complainant did not cross-examine the Complainee’s witness on the not providing reasons of the expulsion.

In light of the above, the Tribunal has no other option but to accept the reasons of the expulsion.

25. Therefore, this clustered ground does not have merit.

Biased, Not independent and Accepted a Fraudulent Disciplinary Report alleged signed by one Vijendra Singh

26. The Complainant did not lead any evidence at Hearing regarding any allegation on the Complainee being biased or not independent. The Complainant cross-examined the Complainee’s witness though that one Vijendra Singh was not at the Disciplinary Committee meeting but the Complainee’s witness stated that he was not present at the meeting to speak to that. There is no other evidence before the Court.
    
27. These are serious allegations which require sufficient evidence to prove the same. After assessing the evidence before the Tribunal, I find there is not enough evidence adduced by the Complainant to support these grounds. Therefore, these grounds lack merit as well.

Unfair Practices in Appeal Process

28. The Complainant states that he was not told of any appeal period and so that was unfair. Further, he filed an appeal to the Complainee on 18^th March 2016 but did not receive any response.
    
29. In cross-examination of the Complainant, he admitted that he did not have a copy of the letter of the supposed appeal. He then further on to say that it could have been stolen in a home break in that he allegedly endured. I agree with the Complainee in this matter, it is very difficult to accept the Complainant’s evidence that there was indeed an appeal letter. This is shown in pages 17 and 18 of the Court Transcript.
30. Also the Complainee’s witness stated that all Board members including the Complainant are issued and are well aware of their right to appeal under the By-Laws and the Act. The Complainee on the other hand says he is unlearned and that only two members of the Board has a copy of the By-Laws. I choose to believe the Complainee’s evidence as it would bring the whole cooperative to disrepute and without credibility if the Board members are not even aware of their rights and responsibilities under the By-Laws and the Act.
    
31. Therefore, these grounds do not have merit.

Decision

32. Therefore, given the above, the Tribunal is of the view that the Complainant has not proven its claim in the application on a balance of probabilities.
    
33. The application has been heard and is hereby dismissed.
    
34. Costs is summarily assessed and awarded to the Complainee in the sum of $500.
    

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Joseph Daurewa
Co-operative Tribunal

5^th August 2024