Air-conditioning and cocktail parties: How a school board’s dismissal of a board member was ruled invalid

Published
20 April 2017

The Western Australian State Administrative Tribunal (the Tribunal) recently set aside the decision of a school board to terminate the membership of one of its board members.

Despite being a state tribunal decision resolved on its own facts, schools should be aware of the Tribunal’s findings on the requirements of procedural fairness in a school board’s decision-making.

The facts

The case concerns a non-government school in Western Australia, which is an incorporated association governed by the Associations Incorporation Act 2015 (WA) (the Associations Incorporation Act).

Mr D was a member of the school Board of Governors for 9 years.

The conflict of interest

On 17 February 2016, Mr D emailed the Board noting his concern regarding an air-conditioning system being installed in the school, which he believed was not to specification. Mr D had been associated with an air-conditioning company which had failed to obtain the contract for the installation of the school’s air-conditioning.

On 23 February, the Chair of the Board (Chair) emailed Mr D, noting that he had a conflict of interest regarding the air-conditioning system issue and asked him to resign from the Board. Replying by email on 27 February, Mr D denied he had any conflict of interest and told the Chair he found the request for resignation to be entirely inappropriate.

A special meeting was convened on 2 March, chaired by the Deputy Chair of the Board (Deputy Chair) and which excluded Mr D. The attending members found Mr D to have a conflict of interest and that his actions were unsuitable and improper.

In a letter dated 5 March (the letter), the Deputy Chair noted the Board’s decision, telling him he must withdraw his 27 February email and formally apologise. The letter concluded by noting that the Board “…will not tolerate any further activities [by Mr D] which seek to use [his] position on the Board in any manner which could be construed as prejudiced…”.

On 15 March, Mr D retracted the email and apologised to the Chair. In the Board’s annual general meeting in April, Mr D re-nominated for the Board and was successful.

The alleged misconduct

On 8 June, Mr D was the sole board member who attended the school’s Parents & Friends (P&F) meeting at the school. The meeting discussed the decision of the Board to cancel the 20 years cocktail evening at the school, and Mr D commented that he thought it could have gone ahead. He later requested the Board to reconsider the cancellation. The Principal claimed that Mr D made him feel uncomfortable and embarrassed by his behaviour at the P&F meeting.

Following discussion with the Chair, Business Manager and the Principal, but without involving Mr D, the Deputy Chair wrote to Mr D on 15 July advising that his position on the Board was untenable and that he was dismissed with immediate effect, due to ‘breach of the conditions set out in the letter of 5 March 2016.' No member of the Board felt there was anything constructive to be gained by holding a further meeting on the matter.  Mr D requested mediation however it did not occur.

Mr D then applied to the Tribunal seeking reinstatement as a Board member. Under section 182(3) of the Associations Incorporations Act, the Tribunal can make various orders, including an order for the association to observe its own rules.

Legal issues and conclusion

Under the Associations Incorporations Act (Division 1, Schedule 1, item 18) an association's rules must include ''a procedure for dealing with any dispute under or relating to the rules (a) between members; or (b) between members and the incorporated association."

The school’s Constitution did not have a dispute resolution rule but under rule 11 of the Constitution, a member ceases to be a member if they act in any manner which the Board finds unsuitable, improper, disloyal to the Principal or the school, or discredits the school.

The issue for determination by the Tribunal was whether Mr D was given a full and fair opportunity to show why his membership of the Board should not be terminated under this rule. The Tribunal decided to declare both the school’s decision to terminate Mr D’s membership, and the letter informing him of this termination, to be invalid and set aside, because of the school’s failure to afford procedural fairness.

The legal requirements of natural justice depend on the circumstances of the case and the nature of the Tribunal’s inquiry. The requirements of natural justice will be satisfied if the decision-making process, viewed in its entirety, entails procedural fairness.

The rules applicable to Boards are more relaxed than other entities, because they have no rules of evidence and members ‘may act upon their own knowledge and upon hearsay if they are satisfied of the truth’. However, the Tribunal noted that there are some basic, fundamental principles which apply to any decision-maker. The Tribunal concluded that the school failed to:

  • fully and fairly inform Mr D of the allegations made against him, in terms of the conduct he was alleged to have engaged in and why that was seen to be prejudicial, in order to enable him to mount a defence. No contact was made with him prior to his dismissal, and the dismissal letter did not refer to rule 11 of the Constitution or expressly state that he would automatically be dismissed if any further actions were found to be unsuitable or improper;
  • give Mr D adequate time to mount his defence to the dismissal letter, or to the earlier conflict of interest issue. Mr D was specifically requested not to attend the special meeting which considered his conflict of interest, and no meeting was called before the dismissal letter was sent; and
  • keep an open mind on the question of whether to terminate Mr D’s employment and to give him a chance to persuade the Board otherwise. The school accepted the Principal’s version of events – that Mr D had behaved inappropriately and in an embarrassing manner at the P&F meeting – without any discussion with him.

The lesson for schools

Even though the Board was in agreement as to the course of action, and its members had previously warned Mr D about his behavior, this was not sufficient to afford him procedural fairness.

The Tribunal’s finding serves as a reminder for all schools that any allegation of misconduct by a board member, regardless of its severity or similarity to a previous incident, must be dealt with in a procedurally fair manner. In deciding whether to dismiss a board member for alleged misconduct, a school board should:

  • fully inform the member of the allegations against them, and the reasons that these allegations may result in their dismissal;
  • give the member the opportunity to provide their version of events or to explain their behaviour;
  • ensure a fair process for dispute resolution is in place;
  • ensure that proper investigation of the allegation occurs, gathering evidence from all parties including the member under scrutiny; and
  • make its final decision fairly and without prejudice.

This matter also demonstrates how seriously school board members take their positions and their willingness to use external channels to resolve disputes.  Schools should be mindful of the reputational damage that may ensue when such channels are used.  Having a robust internal dispute resolution process is the first step in avoiding an internal dispute becoming public.

 

Kieran Seed

Kieran is a Legal Research Coordinator at CompliSpace. In his position, Kieran assists with drafting and review of governance, risk and compliance content programs and client-requested policies, while also writing regular articles for School Governance. Kieran’s key focus areas are student duty of care and school registration. Kieran studied at the University of Sydney, completing a Bachelor of Law and Bachelor of International and Global Studies majoring in Government and International Relations.