ENMORE SPIRITUALIST CHURCH - THE REAL STORY REVEALED
amelia on Wed Jun 23, 2010 12:26 am
DISCLAIMER: Let it be clear from the outset of this review that there is no deliberate intention to cast blame or pass judgement on any individual mentioned. Their actions will speak for themselves. This document merely records the facts as far as they are known at the present time.
If any person, on reading this record, chooses to form an opinion, or arrive at a judgement, they must acknowledge that it is they who have so formed that position, based on their interpretation of the facts here presented. Their actions, subsequent to reading this material will therefore be based on such opinion or judgement and must be their responsibility alone.
This review of events at Enmore Spiritualist Church, and information and material found in it has not been posted directly or indirectly by any Committee member, or member of Enmore Spiritualist Church. It has been posted by those who believe in justice and fair play, and in the necessity that the truth, whether it proves to be flattering or critical, beneficial or adverse, should be told. Spiritualism, as a legitimate Religion, Philosophy, and Science, and Spiritualists, whomever and wherever they are, deserve nothing less than the truth.
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Part 1 - The Present:
On Friday evening, the 4th of June, 2010, an A4 notice was found on the front window of the Enmore Spiritualist Church, located at 2 London Street, Enmore, New South Wales.
“Notice to all Parishioners the church is closed until further notice.
Due to unavoidable circumstances.
We apologise for any inconvenience caused to you
Reverend Cleary”
The same day, three of the Church’s Committee members, elected by the members of the Church at an Annual General Meeting held on 11th February, 2010, 110 days, and just short of four months earlier, received letters from ‘Reverend’ Patricia Cleary, the President of the Church.
The letters, dated 2nd June, 2010, though individually addressed, all conveyed the same information:
“Motions to be moved at a Committee meeting of the Church which is to be held at 6.30pm on Wednesday 23rd June, 2010 at the Church premises, 2 London Street, Enmore.
1. That each of the following members be removed from the Church Committee under clause 18 (a) of the Constitution on the ground of misconduct particularized in the schedule accompanying this meeting notice with effect immediately.
(a) Kerri Sevenoaks
(b) Inge Vann
(c) Glen Shales
2. That each of the following members be removed from their membership of the Church under clause 7 (b) of the Constitution on the ground of the misconduct particularized in the schedule accompanying this meeting notice with effect immediately.
(a) Kerri Sevenoaks
(b) Inge Vann
(c) Glen Shales
Yours truly
(Signed) Patricia Cleary
Reverend Cleary”
The “Schedule of Misconduct by Glen Shales, Kerri Sevenoaks, Inge Vann” which accompanied the letters lists 15 numbered complaints, some items including several different allegations under the numbering system used. These are headed by the following statement:
“Immediately following The Church’s Annual General Meeting held on 11th February, 2010, at which Glen Shales, Kerrie Sevenoaks and Inge Vann were elected to the Church Committee, they have set about a course of disrupting the orderly conduct of the affairs of the Church by engaging in the following misconduct, whether alone in concert (sic)”
The items of misconduct cover a wide range of allegations, and include:
- failure to return Church documents and passwords as requested;
- making false claims that the Reverend Cleary had resigned;
- spreading misinformation about her purported resignation;
- locking the Reverend Cleary out of the Church;
- providing the Department of Fair Trading with documents in the name of the Church without consultation with the committee;
- falsely claiming that such documents had been compiled by all the committee members;
- failing to inform all committee members of the content of documents provided to the Department of Fair trading;
- deliberately withholding information from the committee;
- refusing to table important letters and documents, including legal notices, as requested at the committee meeting, this affecting the orderly management and control of the Church;
- locking a committee member in a room, with the view to obtaining her signature on a document with defamatory remarks about certain Committee members;
- yelling abuse and defamatory remarks to Committee members in hearing range of children, a Church member and visiting Medium;
- sending text message with insulting remarks to a Committee member late at night;
- preventing access to the Church premises to the Reverend Cleary;
- refusing to provide her with a key to the new lock;
- making false and misleading allegations of financial mismanagement in respect of the finances of the Church by certain committee members;
- failure to provide Treasurer Monthly financial reports to all Committee members;
- failure of the Acting Secretary to provide minutes to all Committee members for their own keeping.
There is no doubt, that on examining this schedule of misconduct, some very serious allegations of improper behaviour are described. The question is, of course, is the alleged misconduct actually true? Is it entirely true, partially true or even entirely untrue? And if so, in what circumstances did this occur? If not true, or a distortion of the truth, why is this action now being taken, and by whom?
Equally important, is the fact, that on examining this schedule, it is clear it fails to identify which of the three named Committee members, actually committed any of the itemised alleged misconducts.
Did they ALL fail to return documents, make false claims, lock the Reverend out of the Church, disrespect her, provide the Department of Fair Trading with false information, withhold information from the Committee, refuse to table important letters and documents, refuse to share information, lock a member in the room with an intent to coerce, yell abuse and make defamatory remarks, send insulting test message, make false and misleading allegations of financial mismanagement on the part of certain committee members, or fail to produce Treasurer’s reports, and so on?
Or, did each of the named person’s commit some of the alleged misconduct, but not other alleged misconducts? Did one named person commit only one of the alleged misconducts, while another committed many of these?
These are important questions, for without identifying who allegedly did what, how can these three named individuals defend themselves against the allegations, if indeed, they have any defence. How do these people effectively refute these allegations of misconduct?
Must they prove that they didn’t, for example, fail to provide a Treasurer’s Monthly financial report, because they are not the Treasurer? Or that they didn’t lock the President out of the Church because they don’t hold keys to the Church? Or are they to be deemed guilty, without distinction being made as to what their specific alleged crimes against the Church actually are?
Is it sufficient, if a person named is deemed ‘in the opinion’ of the other Committee members, guilty of one of these misconducts, though not of others, that their status as an elected Committee member be removed, or do they need to be deemed to have committed more than one, say, three, or seven, or all of them, to justify removal?
A significant miscarriage of justice would appear to be possible, with a motion to remove Committee members from an Incorporated Association, which the Enmore Spiritualist Church is, couched in this undefined and undesignated manner.
This appears to also be the case in terms of the motion to remove these named persons, as members of the Church.
Clause 7 (b) of the Enmore Spiritualist Church Inc Constitution provides that a Committee may remove a member from the Membership Roll, when their actions are, in their opinion, contrary to, or enters into a course of conduct, likely to prejudice the interests of the Church or bring the Church or its objectives into disrepute.
Of course, in this issue, as in that of determining to remove these people as Committee members, procedural fairness would require that the opinion a person’s membership should be removed must be ‘reasonable’, and based on grounds which any reasonable person* might arrive at, when presented with the allegations of misconduct being considered.
* In legal terms, this is what is often referred to as ‘the man on the London Omnibus’ common law test of reasonableness.
This means, of course, that the information on which the Committee members rely must be real examples of misconduct, not fabrications, or distortions of the truth; that the Committee members must genuinely consider that evidence before arriving at a decision, and, the opinion they arrive at, based on the evidence, should be what any ‘reasonable’ person was likely to conclude.
It cannot, for example, be considered reasonable for certain Committee members to have made up their mind to remove another Committee member, before the person against whom the motion has been moved has been given a reasonable opportunity to know what the allegations of misconduct made against them actually are, and has equally had an opportunity to answer to the alleged misconducts, including the right to offer any defence to them that they may wish to present.
There is an expectation that Committee members, will act in a proper manner, in accordance with the duties placed upon them by the Association’s Constitution, and the relevant legislation (in this case the Associations Incorporation Act 1984, and other associated legislation). That they will, in considering such a serious matter as the loss of membership and of Committee status, do so in a reasonable and honest manner.
It is a standard and well understood practice that, for procedural fairness to occur in such situations, Committee members will not, for example, take part in any deliberation of such motions, if they have a vested interest in the outcome, such as where a Committee member may receive a ‘pecuniary benefit’ from supporting the motion to remove the member. This is clearly a case where a ‘conflict of interest’ exists. Any Committee member who has a personal interest in the outcome of the deliberations should always excuse themselves from the decision making.
In other words, when based verifiable information (evidence), on which a genuine majority of Committee members, who do not have a conflict of interest, individually, and jointly, believe that a member should be removed, and that belief, or opinion, is reasonable (though not necessarily correct in strict legal terms), a Committee may arrive at a decision to remove a member.
In this specific case, the question must inevitably be asked: Do any, or all, of the Committee members who will consider this motion to remove three people from the Committee and as members of the Church, have any conflict of interest that might affect their ability to arrive at a genuine determination in this matter; that is, does Reverend Patricia Cleary, Ms Caroline Allen, Ms. Miranda Vila, and Mr. Jon Lindsay, have any pecuniary interest, that might influence their decision making? One might also ask whether Mandy Miami (Miranda McCarthy) who is, it is understood, Mr. Lindsay's 'partner' and a member of the previous Committee, also have a 'pecuniary' interest' in the matters before the Committee tonight?
It would appear that there may be evidence which would suggest that they do, indeed, have such a conflict of interest, resulting from a pecuniary benefit, which would arise if Ms. Kerri Sevenoaks, Ms. Inge Vann, and Mr. Glen Shales are no longer on the Committee or members of the Church. Just what that interest is, will be dealt with in some detail later in this review.
History Repeating Itself:
It must also be said, that, in regard to allegations of misconduct against certain Committee members, aimed at removing them from the Committee, and as members of the Church, what is happening right now appears to be history repeating itself.
During 2009, four of the then Committee members, headed by the President, Reverend Patricia Cleary, attempted on repeated occasions to remove on the grounds of misconduct the other four Committee members, all of whom had been elected to the Committee by the members at the Annual General Meeting held on Thursday 5th February 2009.
The President, Ms. Cleary, and general Committee members, Ms. Caroline Allen, Ms. Matilda Vila, and Ms. Mandy Miami, legally known as Ms. Miranda McCarthy, were the persons who sought to remove from the Committee, the Vice-President and Secretary, (who was also the Public Officer), Ms. Chorel Terelinck, the Treasurer, and general Committee members, Ms. Wendy Hemington, and Ms. Reci Kypri.
In September 2009, after the four Committee members, headed by Ms. Cleary, had tried on at least 3 previous occasions to remove the other Committee members, an action that the ‘breakaway’ Committee members refused to accept was valid, Ms. Cleary, and her faithful Committee members, attempted to appoint a further person, Mr. Jon Lindsay, to the Committee.
From June 2009, Ms. Cleary, Ms. Allen, Ms. Miami, and Ms. Vila had been operating as a Committee without having a quorum. A number of very significant and far-reaching decisions were made during that time, including action involving the appointment of lawyers, and the taking of a legal action resulting in a court hearing in November 2009.
Whether the four Committee members, named above, who were the ‘plaintiff’s in that legal action, were acting independently as individuals, or were representing the Church in these dealings, is a matter of much debate, and uncertainty. Whether, in the circumstances, being four Committee members in dispute with the other half of the Committee, and having no quorum at Committee meetings, they were ever validly in a position to purport to act on behalf of the Church, is also a matter of great conjecture.
The consequence of their actions, however, is quite clear, as are the enormous financial costs their actions incurred. More will be reported about this matter later.
Whether the person who joined the Committee in September was ever a valid Committee member, is a not unimportant point, since the four ‘breakaway’ Committee members had not yet validly been removed, and were not until November 2009, however, whatever his true status was, Mr. Lindsay played and continues to play a significant part in the story that has unfolded at Enmore Spiritualist Church.
In February of this year (2010), the membership re-elected Ms. Allen, who was nominated by Rev. Cleary for the position of Church Secretary, and appointed by the membership, and Ms. Villa (nominated by Mr. Shales), and Mr. Lindsay (nominated by Mandy Miami), as general Committee members. Ms. Cleary remained in position as President, and was not subject to election.
Ms. Miami who stood for the position of Vice-President, on the nomination of Mr. Lindsay), was unsuccessful; Ms. Kerri Sevenoaks, nominated by Ms. T. Arronis, was elected to the position of Vice-President by the membership.
Four further members were elected to the Committee to in accordance with the Constitution, to arrive at eight Committee members. They were Ms. Inga Vann, nominated by Ms. Sevenoaks, and elected unopposed as Treasurer, while Ms. Lola Inglezakis, and Mr. Glen Shales, completed the Committee as general members.
Four months on, it seems that once again the President, Ms. Cleary, Ms. Allen, Ms. Vila, and Mr. Lindsay, wish to remove the Vice-President, the Treasurer, and a general Committee member on the grounds of misconduct.
Tonight, at 6.30pm, a Committee meeting will be held. The Vice-President, the Treasurer, and a general Committee member, will find their fate decided.
Though without doubt, all three emphatically deny and refute the allegations against them, indeed, may well have done so in writing, and requested the evidence relied upon to support the allegations of misconduct, it is doubtful they will attend the meeting to hear the outcome.
It is understood they will not because they believe it has already been decided. They will not get a fair hearing. They will not be listened to. Their denials of guilt will be ignored. Their evidence of the falseness of the allegations will be dismissed.
It will not be a valid meeting of the Committee, just as the alleged motion to remove them to be considered at it, is not valid.
Why? Because there has been no validly convened Committee meeting at which these motions to remove were ever moved for discussion or vote.
Clause 18(a) of the Enmore Spiritualist Church Incorporated Constitution defines how a motion expressing an intention to remove a Committee member must be decided upon at a validly convened Committee meeting, after which the member must be notified of the intention of the Committee to deliberate on the motion, and the member given an opportunity to defend themselves against the allegations at a subsequent Committee meeting, before any decision is made.
The President does not have the authority to independently move a motion to remove a Committee member or member, and can only instigate such action on the authority of a Committee decision. No individual Committee member can act to move that a Committee member be removed either.
In other words, the President of the Enmore Spiritualist Church has sent to three Committee members a notice of a motion in contravention of the requirements of the Constitution of the Enmore Spiritualist Church Incorporated.
Despite the fact that it is likely only four** of the current Committee will attend the meeting this evening, and there being, therefore no quorum (the Constitution requires 5 Committee members to constitute a quorum), based on history, the motions will be voted upon and be deemed by the four present as having removed 3 members from the Committee, and from membership of the Church.
** It is understand that Ms. Inglezakis, the fourth Committee member, not as yet under threat of removal, was unaware of the purpose of tonight’s meeting, but now having been made aware of it, and being unhappy at not being informed of what was going on, is also unlikely to attend the meeting, though it is not impossible that pressure might yet be put upon her by the other four Committee members to be present.
Perhaps, as has been done in the past, when dealing with attempts to remove Waters, Terelinck, Hemington and Kypri, the President will attempt to use her deliberative and casting vote, to give the appearance of a majority of 5 votes in favour of the removals.
That such an action is obviously invalid, and contrary to the requirements of the Constitution, the legislation, and procedural fairness, unfortunately did not in the past prevent Ms. Cleary from acting in this way, apparently in an effort to lend validity to her actions, and decisions of the quorum-less Committee meetings.
Let it also be said at this point, that there is substantive, objective and verifiable documented evidence, that the allegations of misconduct against Ms. Kerri Sevenoaks, Ms. Vann, and Mr. Shales, are untrue, or constitute a major distortion of the true facts and circumstances that have taken place at Committee meetings, and in the Enmore Spiritualist Church.
Perhaps, one can now begin to see why it is suggested that ‘history’ may be repeating itself.
Cancellation of a Special General Meeting:
It should also be noted here, that on the same day the three Committee members received letters informing them of motions to remove them they were informed, in writing by Ms. Caroline Allen, Secretary of the Enmore Spiritualist Church Inc, a Special General Meeting of the membership previously called for Tuesday 8th June, 2010, had been cancelled. The cancellation of the SGM, originally called by the full Committee at a meeting on the 18th of May, 2010, and duly notified to the members, was, the notice claimed “due unavoidable circumstances.”
What those circumstances were, or how a decision was made to cancel the SGM, and by whom, remains a mystery.
As far as the three Committee members under threat of removal are aware, no Committee meeting at which such a decision to cancel the SGM could validly be made has been held. Indeed, a meeting planned to prepare for the requirements of the SGM meant to take place on the 28th of May, 2010, was arbitrarily cancelled by the President, Ms. Cleary, on the day of the meeting. It was allegedly rearranged to be held on Friday 4th June, 2010.
That’s right, to be held on the same day, that Sevenoaks, Vann, and Shales received notification of motions against them, and of the cancellation of the SGM.
Did a Committee meeting actually take place on Friday 4th June, minus the attendance of Sevenoaks, Vann and Shales, and of course, the fourth Committee member, Inglezakis? Apparently not! Or if it did, no one is telling!
The consequence, however, of the cancellation, and the subsequent recalling of the SGM meeting to now be held on Tuesday 29th June, 2010, is, assuming Sevenoaks, Vann and Shales, are removed as Committee members and members of the Church at the Committee meeting tonight, they will , in the view of Cleary, Lindsay, Vila and Allen, be unable to attend the SGM, nor to address any of the many issues, including certain very significant financial matters, that would have been placed before the membership were they still on the Committee.
Bear in mind also, that Ms. Vann, as the elected Treasurer of the Enmore Spiritualist Church Inc was due to present the required Financial Report for the year ending December 2009 to the members at the SGM. It is understood, however, that Ms. Vann was recently informed she was not entitled to present the financial report because she was not the Treasurer in 2009!!!
Instead, apparently the President intended do so, despite the fact that she wasn't the elected Treasurer in 2009 either, though did 'take over' the job in one sense during that year, even though Ms. Terelinck who really was the elected Treasurer, was not legally removed from that position until November 2009, and retained the cheque book and accounts books for much of the year.
One might reasonably ask, what on earth is going on at Enmore Spiritualist Church?
To even begin to answer that question it will be necessary to examine in some detail events that have occurred at Enmore Spiritualist Church over the past 15 or so months.
Over the coming days, this is exactly what the forum will attempt to do. Then the current members, past members, including those who have been removed in one way or another in the past year, and members of the general public who take an interest in the welfare and continued existence of Enmore Spiritualist Church Inc will be better placed to understand what is happening in this Church. It is time the whole story is told.
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Part 2 – Background Information:
“The spirit feud not even the psychics saw coming,”
Sydney Morning Herald 2nd November 2009:
Many in the Spiritualist community in both Australia and overseas first became aware of the dispute that was occurring at Enmore Spiritualist Church, when on November 2nd, 2009, the Sydney Morning Herald published an article entitled “The spirit feud not even the psychics saw coming,” written by journalist Tim Elliott.
It began with the following words:
“Before all the talk of embezzlement and bikies taking over, and before the allegations of vandalism, abuse and computer hacking, the Enmore Spiritualist Church was just your average suburban home where people performed seances and channelled the dead.”
Now, Spiritualists know that Spiritualist Church’s are not really about ‘channelling the dead’ and the phrasing used by Mr. Elliott is not appropriate or fair, especially since the building from which Enmore Spiritualist Church operates is the registered meeting place of an Incorporated Association, not a “home,” as referred to in the article. Nevertheless, the reference to “embezzlement,” “vandalism,” and “bikies taking over” was disturbing, if true.
The article went on to state that a “bitter schism” existed at Enmore Spiritualist Church which had “led to members being locked out, police being called, and a blizzard of legal threats and counter threats.”
The article also alleges that the “troubles began in February, when Cleary 87 (the President of Enmore Spiritualist Church), lost the position of treasurer to (Chorel) Terelinck.” It further claimed that the new treasurer, on examining the financial records “identified several inconsistencies, such as missing petty cash and altered receipts.”
Mention is made of the then Secretary, who was also the Vice-President and Public Officer of the Church at the time, though this fact is not made clear in the article. According to Elliott, an independent review of the financial records was commissioned by the Church with accounting firm CBC partners, who, “among other things” allegedly “found no receipts for expenditures of $45,000 between 2006 and (2008), when Cleary was treasurer.”
There are also certain claims made, which the article alleges were said by Mr. Waters, and counter claims allegedly made by Ms. Cleary relating to who might have “taken the money” and what motives Mr. Waters may have had. It was claimed also that “the committee” had confronted the Church President over these allegedly missing receipts.
Attention is drawn to a time, in September 2009, when it was alleged that:
“24 of the church's 46 members voted to remove Cleary as president and call an election. Cleary responded by declaring the vote invalid; she then shut the church, had the locks changed and installed a supporter …”
The article continued with the following statement:
“Relations between the feuding parties have since turned ugly. Both sides accuse the other of violence and intimidation. Police have been called to the church several times, the last being October 22, after white paint was spattered over the front of the property. The tussle has spilled into cyberspace. Each side accuses the other of hacking into the church's website.”
After further remarks, best left unrepeated, since they appear to defame Mr. Waters, the article informed the public that “Cleary’s lawyer, Terry Goldberg of Turner Freeman … has been instructed to commence proceedings in the Supreme Court …”
Ms. Terelinck was reported as having described the situation as “totally bonkers and very sad. We need to save the church for the legacy for which it was set up. We just want to get the doors back open for the members.” Earlier in the piece she had allegedly stated “I know we’re meant to be psychics … But none of us saw this coming.”
Reviewing the News Article:
How accurate a report might this news article be? Clearly the writer had no real knowledge or understanding of what services and activities take place in Spiritualist Churches, but perhaps he can be forgiven for that – after all many people do not.
That a bitter schism existed is undoubtedly correct, and many different allegations and counter- allegations do seem to have been expressed by various parties involved in the dispute. That Ms. Cleary was described as having “lost the position of treasurer to Terelinck” is less accurate, given, in fact, Ms. Cleary had not stood for the position at the AGM that year.
Whether she would have wished to continue in the role of treasurer, a position she had held for a number of years, both before, and after, the time the Church became an incorporated association, is possible, however, it appears she was not nominated by the membership, and Ms. Terelinck was duly appointed to the role.
It also appears to be correct to say that Ms. Terelinck, and Mr. Waters claimed that on examining the financial records they discovered there were certain inconsistencies and missing receipts. Whether this was due to ‘misappropriation’ of some kind, or merely poor standards of book-keeping is still a matter for conjecture, and an issue unlikely to be resolved with any certainty one way or another despite further attempts to do so.
As such, it would seem quite inappropriate to accuse Ms. Cleary, or any one else for that matter of embezzlement, or mismanagement of Church funds. Nevertheless, it was evident that the Church’s financial records were an issue, and one of significance. Indeed, they remain so today.
A further matter mentioned in the article concerned a time in September 2009 when a number of members allegedly ‘removed’ Ms. Cleary as President and Ms. Cleary responded by closing the Church. This ‘meeting’ was to become the subject of legal proceedings, and will be dealt with in some detail in due course.
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Part 3 – Further Background Information:
Before progressing to reviewing what happened in 2009 it is relevant to make clear the background situation regarding the nature of the organisation, the property, and finances of Enmore Spiritualist Church prior to that time.
The Church became an Incorporated Association on 20th July, 2005. Prior to that time it had operated for many years as an unincorporated body, whose property, located at 2 London Road, Enmore was held in a trust for the benefit of the Church and its members.
The Property – Title Deeds & Trust Document:
The Certificate of Title on the property, which is readily available to the public on request, shows that in 1976 a ‘Declaration of Trust By Trustees,’ dated 11th July, of that year, declared that five named persons, having been elected by the members of what was then known as ‘The Stanmore Spiritualist Church of New South Wales,’ were registered as the proprietors of the property in fee simple as joint tenants and that by the deed of trust they held the property as “Trustees upon trust for the absolute benefit of” the Church.
A later Trust Declaration, also attached to the Title, shows that in 1984, the Church was by then known as ‘The United Spiritualist Church of Enmore,’ and that the five named Trustees, who were composed of a different group of individuals from that in the original trust document, were again holding the property in Trust for the “absolute benefit” of the named Church “and the members thereof.” One of the trustees at this time was Ms. Patricia Cleary.
Attached to the Certificate of Title is a “Caveat by the Registrar General Forbidding Registration of Dealing With Estate or Interest” which specifies that registration of any dealing affecting the land comprised in the Certificate of Title, that is, the property located at 2 London Road, Enmore, NSW, that is “not in accordance with the terms of a certain declaration of Trust” is forbidden.
In other words, the registration of any dealing (sale, mortgage, loan, transfer of ownership, etc) that is not in accordance with the object of the trust, namely for the “absolute benefit” of the Church and its members, is not allowed.
On 22 November 2006, further documents were lodged and attached to the Certificate of Title, vesting the Title in the now named ‘Enmore Spiritualist Church Incorporated.’ This shows that the land (identified by Folio Identifier) is “held by the named trustees noted on the Title Deed as Trustees for ‘The United Spiritualist Church of Enmore’ which on 20 July 2005 was incorporated pursuant to the Associations Incorporation Act … and …the property is from that date real property held by the Trustees as vested in Enmore Spiritualist Church Incorporated.”
This is accompanied by a 'Certificate of Public Officer of Enmore Spiritualist Church Incorporated,' who was at that time Ms. H. L. Kitson. It declares that “immediately before incorporation of Enmore Spiritualist Church Inc on 20 July 2005 (it was) held on trust by Patricia Cleary, Lionel White, Marcia Joyce Quinton and Susan Elizabeth Morrison.” The declaration was signed by Ms. Kitson on 25 November 2006.
A further letter that forms part of the Certificate of Title Deeds, from Boyd House & Partners, Solicitors, makes clear “the vesting of the property from individual names of the trustees in which the Title is currently held, to the name of the incorporated association, Enmore Spiritualist Church Incorporated.”
This would suggest that at the present time those who were Trustees are no longer trustees of the property, it having been vested in the Association subsequent to incorporation, however, the requirement of the pre-existing trust deed that the property be used for the absolute benefit of the Association and its members remains intact.
It may be wondered why such a length exposition of the Title Deeds, trust documents, and ownership of the property has been undertaken. Is will become clearer as this review progresses, however, it is pertinent to mention here that in recent times various parties have wished to obtain hold of the Certificate of Title to the property. The deeds were held for many years in safe keeping by a firm of Solicitors, though it is unclear whether this is still the case today.
It would appear that the Church’s property can be sold, or indeed used as collateral for a loan or a mortgage, however, whatever is done it must always be done with the absolute benefit of the Church and its members as the express purpose.
Should, for any reason, the association cease to exist - that is permanently close, or be dissolved by the membership, and/or no longer operate for the absolute benefit of the association and its members, there is no provision in the trust deed for the proceeds from the sale of the property to be used for any other purpose.
Financial Affairs of the Church 2005 – 2008:
It is uncertain how financially viable the Church was, under the Presidency and Treasurer-ship of Patricia Cleary, in the years prior to Incorporation. Ms Cleary, who has been given the title of ‘Reverend’ by the membership in accordance with provisions in the Church Constitution, was the Treasurer of the Church in the years 2002, 2003, 2004, and 2005, prior to Incorporation, and remained as President and Treasurer after Incorporation in 2005, 2006, 2007, and 2008.
In 2009, at the Annual General Meeting held on 5th February, Ms Chorel Terelinck was elected as the new Treasurer of the Association.
It is worth detailing certain information, taken from the annual financial reports presented to the membership of the newly formed Incorporated Association in the years 2005 to 2008, particularly in light of the allegations which would arise in 2009, of misappropriation and/or mismanagement of Church funds.
a) 2005 Financial Statement:
An ‘Accountants Report’ produced by the firm Chan & Naylor Pty Ltd, Public Accountants dated 23 January 2006, states the firm had examined the books and vouchers of the General Fund Account for the year ended 31st December 2005, and in their opinion the statement of income and expenditure and balance sheet were in accordance.
In the 2005 financial year the statement of Income and Expenditure showed that the newly formed association had a total income of $43,593.97, while the total expenditure amounted to $52,766.55.
Therefore, in that Financial Year there was a deficit of expenses over income amounting to $9,172.58, and the Church had operated at a loss in 2005.
The most significant expenditure, that year was found to be for repairs and maintenance ($8,541.40), legal costs ($8,418.40), and insurance ($7,314.93).
However, a significant amount of high expenditure was also found for other items, expenditure which might be considered excessive for a small incorporated association such as Enmore Spiritualist Church.
The major further items were: Entertainment/refreshments in excess of $4,000.00; sundry expenses over $3,200.00; cleaning over $3,200.00; travelling*over $3,200.00; telephone just a few dollars under $3,000.00; flowers, gifts, candles almost $2,000.00; and garden $1,600.00.
* Note: The “Travelling” expenses itemised in excess of $3,200.00 was apparently the cost of petrol reimbursed to the President to travel to and from the Church on a weekly basis.
At the end of the 2005 Financial Year, the Church had Accumulated Funds in excess of $16,000.00 held in the Church’s bank account.
This Financial Statement was duly presented to the membership at the Annual General Meeting held in February 2006.
b) 2006 Financial Statement:
The Financial Statements for the year ended 31st December 2006, was also compiled by the accounting firm, Chan & Naylor. Total Income for 2006 amounted to $36,844.05, while Expenditure stood at $40,901.36.
Therefore, in the 2006 Financial Year, the Church had once again operated at a net loss of $4,057.31.
The combined loss over income in 2005 and 2006 amounted to $13,229.89 (comprising $9,172.58 in 2005, and $4,057.31 in 2006). At the end of 2006, the Church’s Accumulated Funds now stood at $12,363.76, held in the Church Bank Account.
Expenditure in 2006 showed some significant figures. Apart from insurance at $8,302.99, Petty Cash stood at $3,600.00; cleaning/rubbish removal at $3,255.00; printing & stationary at $3,072.55; repairs & maintenance: $2,682.00; telephone & internet: $2,457.61; keys: $2,277.50; donations (to various charities): $1,884.00; legal fees: $1,821.56; travelling: $1,490.36; and sundry expenses: $1,328.14.
This Financial Statement was duly presented to the membership at the Annual General Meeting held in February 2007.
c) 2007 Financial Statement:
The Statement of Financial Performance, Statement of Financial Position and Statement of Significant Accounting Policies, was again prepared by accountants, Chan & Naylor.
Total Income for 2007 was $48,658.74, while Total Expenditure was $37,862.53.
For the first time since becoming an Incorporated Association, Enmore Spiritualist Church made a Net Profit over Expenditure of $10,796.21.
Again, however, expenditure was high on a number of items: Insurance: $6,219.41; Petty Cash: $4,510.00; M/V car – petrol: $3,182.90; cleaning/rubbish removal: $3,090.00; repairs & maintenance: $2,935.97; telephone & internet: $2,672.25; printing & stationary: $2,207.36; flowers: $1,450.00; gifts & candles: $1,440.60; marriages/funerals/benevolence: $1,379.45; and, sundry expenses: $1,360.90.
This Financial Statement was duly presented to the membership at the Annual General Meeting held in February 2008.
d) 2008 Financial Statement:
The Financial Statements were again produced by accountants Chan & Naylor.
Total Income for 2008 was $50,873.69. Total Expenditure was $40,296.15.
Net Profit over Expenditure: $10,577.54.
Most Significant Expenditure in 2008 was: Insurance: $7,330.64; travelling*: $5,598.50; legal fees: $5,603.40; petty cash: $4,050.00; repairs/maintenance: $3,883.00; cleaning/rubbish removal: $2,320.00; sundry expenses: $1,397.98; and donations: $1,378.00.
In comparison to 2007, where expenditure on flowers, gifts & candles was $2,890.60, in 2008, the total expenditure on these items fell to $1,000.00.
*Note: Travelling costs which were already high rose significantly in 2008 over previous years (2007: $3,222.60; 2006: $1,490.36; 2007: $3,182.90) to $5,598.50), due to the President no longer being able to drive and being authorised by the Committee to travel by taxi to and from the Church.
On averaging the expenditure over a 12 month period the cost for taxi’s in 2008 was approximately $466.54 per month. Given the Church traditionally closed at certain times of the year, and the return journey to/from the church from the President’s home was claimed at $140.00 per journey, the real monthly figure is actually higher.
This Financial Statement was duly presented to the membership at the Annual General Meeting held in February 2009.
e) Unpaid Present Entitlements:
It must be noted in the Financial Report for 2008, the accountants noted under the heading of “Financial Liabilities – Unsecured: Unpaid present entitlements: Trust Fund” the sum of $8,143.86.
Note: This figure was to give rise to significant confusion resulting in the Financial Statements for 2008 being approved at the Annual General Meeting subject to “the condition that the sum of unpaid present entitlements of $8,143.86 is accounted for.”
Further discord occurred at the first Committee meeting after the AGM, held 6th March 2009, regarding this figure, when the newly elected Vice-President, Secretary, and Public Officer of the Church Association:
“pointed out to the committee that the church was facing a theoretical problem as when the insurance bill is paid and if there is $8,143.86 owing to someone as presented in last year’s financials that the church would only have around $11,000 left in the bank account.”
Other issues of importance also arose at this meeting which will be dealt with shortly.
It is unfortunate that neither the members at the AGM, the Committee members, especially, the then Treasurer, Ms. Cleary, and subsequently, Ms. Terelinck and Mr. Waters, did not at the time check with the accountants what this sum of money referred to, as, had they done so, much confusion and, perhaps some of the subsequent animosity between certain parties might have been avoided.
In simple terms, the $8,143.86 listed as unpaid present entitlements, did not refer to any outstanding debt at all. It was a mere accounting device to show that the sum of $8,143.86 was the net profit attributable to beneficiaries of the trust – Beneficiaries Share of Profit – Trust Fund of $10,577.54 less (2,433.68)** resulting in the figure of $8,143.86.
** The accountants had, over the previous years, offset the losses incurred in 2005, and 2006, against the profit figures of 2007, and 2008, hence arriving at a figure of minus $2,433.68, which was deducted from the net profit of $10,577.54 accrued in 2008.
As such, there was not only no debt, the figure represented a ‘profit’ due to the ‘trust’, that is to the benefit of the Church. It certainly did not represent a sum of money that may have been ‘misappropriated’ or accrued as a debt by any mismanagement.
f) Overview of Financial Reports of 2005 – 2008:
It is evident that initial costs in becoming an Incorporated Association were high and that for the first two years the Church operated at a loss. In the following two years, the Church’s financial position improved significantly, with income over expenditure in the $10,000 to $12,000 range. Given this, it is likely, had the difficulties of 2009 and ongoing not occurred, the Church would have continued to operate successfully, with modest, but genuine profit over expenditure in each financial year.
The consequences of the difficulties, in terms of expenditure, disruption of Church activities, and emotional distress of all parties involved in the dispute, has been a disaster for the Church, and a disaster in human terms.
Having said that, it might also be considered that the Church was, in the years 2005 to 2008, was spending far too much on items which, in the long term it would not be able to maintain unless income had increased significantly each financial year.
This is particularly the case with respect to expenditure on travelling costs, legal fees, repairs and maintenance, as well as on flowers, gifts, and candles. Importantly, the Church financial reports suggest poor record keeping, in that large amounts of money are recorded under headings such as Petty Cash, and Sundry Expenses, leaving the nature of the expenditure unidentified.
It should also be noted, that what is evidenced in the annual financial reports of Enmore Spiritualist Church, in terms of its simple and perhaps antiquated accounting system, is not at all uncommon amongst small incorporated associations, especially those of a religious or quasi-religious nature, particularly when they have been previously in operation for many years as unincorporated bodies.
The Requirement of the Constitution:
At this point it is necessary to draw attention to the fact that the Constitution adopted by the Church in 2005, required at “Clause 21. Auditor: (emphasis in bold added):
The books of account and other financial records of the Church shall be audited at least once every twelve months by a registered auditor. The report of the auditor shall be presented to the Committee, the Directors and the Annual General Meeting of the Church.”
This provision of the Constitution presents the Committee of Management of the Church with an imperative. The word “shall” means that they must have the financial records of the Church audited by a registered auditor, in order to comply with the requirement of the Constitution.
Requirement of the Constitution Not Met:
In reality, the Financial Statements produced by the accountants Chan & Naylor, were not audited reports merely a financial statement prepared from information provided by the Treasurer, Ms. Patricia Cleary each year.
This fact is confirmed by the accountant producing the financial statements, and it is understood was done so in writing to the Solicitors Turner Freeman & Associates in November 2009, wherein they reiterated what they had previously verbally advised the lawyers in October 2009.
This is a significant breach of the requirements of the Constitution on the part of the Treasurer incumbent in 2005 to 2008, and the Committee of that time. In breaching the requirements of the Constitution, the Treasurer and responsible Committee were also in breach of the requirements of the Associations Incorporation Act 1984.
It appears that the then Treasurer, Ms. Cleary, and possibly the Committee members, during the time period 2005 to 2008, were aware that Chan & Naylor were not in fact undertaking an Audit of the financial records of the Church, nor were they undertaking the production of a financial report as registered auditors. There is some evidence to suggest Ms. Cleary’s view was that having the financial records audited would cost prohibitive, and hence the requirement to do so in the Constitution was ignored.
Such an approach to maintaining financial records of the Church’s activities may be viewed unfortunate, particularly when it is recognised that the problem could have easily been rectified by taking a motion to the membership to remove that requirement from the Constitution on the grounds of it being a cost, excessive to the needs of a small incorporated association, with a limited income - audited financial records and production of reports by a registered auditor potentially costing, even for such a small organisation, in excess of fifty percent of any profit each year.
