The High Court (HC) was requested to decide on the legality of an election for the Executive Committee (EC) of a religious charity.
Background:
Masjid e Tauheedul Islam is a registered charity whose principal activity is the running of a mosque in Blackburn. The charity has around 1,200 members. The constitution of the charity provides for its business to be conducted by an EC. In addition, four trustees are to hold the property of the charity although they do not themselves have a role in its management.
Around June 2024, a notice was issued announcing an Annual General Meeting (AGM) to be held on the 4th of August 2024. The notice outlined the dissolution of the current committee and the nomination process for new candidates to the EC, requiring all nominees to adhere to a code of conduct and meet specific criteria.
On the 3rd of July 2024, 26 members wrote to the Trustees and the EC requesting that a Special General Meeting (SGM) be convened. The notice stated that the board of trustees had unanimously agreed to hold an SGM on the 11th of August 2024 which included a list of the candidates nominated. The vote could take place between the 29th of July and the 4th of August 2024. However, no AGM was held on the 4th of August 2024. The results of the ballot were posted on the 7th of August 2024 on the noticeboard of the mosque. However, only 34% of all eligible members voted.
Various questions were raised, although the main ones were whether the election was conducted in compliance with the charity’s constitution, even extending to the lawfulness of a previous election. The applicants also sought declaratory and injunctive relief regarding the election.
Decision:
The HC concluded that the election did not comply with the stipulated procedures in the constitution, notably Clause 9, as the elections should have occurred at an AGM. The election of the new EC was thus deemed to be invalid.
The Judge agreed that there were clear breaches of the constitution. However, the Court found that there was “no basis on which a power in the Executive Committee to impose the criteria at issue in the present can be implied into the constitution.” However, this was not an independent breach.
The HC, applying the test for the grant of an interim junction found in American Cyanamid Co v Ethicon Ltd [1975], granted such relief. The Judge ordered a new AGM to be convened for October 2024.
The Court ordered a stay on the Part 8 claim, indicating that further proceedings might be unnecessary given the outcome of the case.
Implications:
This case highlights the importance of following a constitution to avoid elections being invalidated. It also provides useful guidelines as to the lawfulness of the elections. One key takeaway from the case is the importance of drawing up a constitution which affords some latitude if that is what a charity, or indeed a company requires. A well-drafted constitution avoids many conflicts and allows for a swift resolution by courts, as was the case here, with only two months elapsing between the start of the lawsuit and the judgement.
The decision also reaffirmed the application of the American Cyanamid for injunctions in the context of a charity.