Advice that most members of state executive of the New South Wales Liberal party would cease to hold office next Monday would do “significant violence” to the principles of the party, the state’s supreme court has heard.
On Thursday, the chief justice of the supreme court in equity, Julie Ward, reserved her decision in an urgent case which will determine the future of the NSW branch of the Liberal party.
However Ward noted Monday’s crucial deadline, when the state executive of the party – the equivalent of the board of a company – arguably ceases to exist.
A bitter factional war over preselections has paralysed the NSW party’s state executive, resulting in the Liberals not having endorsed candidates in nine important seats just weeks before an expected federal election in May.
It has also prompted a constitutional crisis that has cast doubt on the division’s future, and prompted the federal party to consider a takeover.
The urgent hearing, brought by one elected member of the state executive, Matthew Camenzuli, is seeking a declaration that members of the state executive can continue in office beyond Monday 28 February despite the annual general meeting of the party having been postponed to March.
If Ward decides the state executive members cease to hold office, the federal division will step in and take control, giving the prime minister, Scott Morrison, a much greater say over who becomes candidates.
If Camenzuli wins his case the state division continues to operate with its state executive in place, but there is no certainty that the gridlock over preselections will be resolved easily.
Camenzuli and his supporters in the party want to see the local branches given the right to hold preselection ballots, where branch members choose the candidates, as the constitution of the party now requires.
But time is running out.
Factional organisers have been attempting to negotiate a deal that would see candidates appointed administratively, but have struggled to get 90% of the 28-member executive to agree to the carve-up of seats, as is required.
The centre-right faction – that of Morrison and his representative on the state executive, Alex Hawke – appear to be supporting a federal intervention.
Hawke, who has been named as first defendant in the case, had a lawyer present at proceedings on Thursday but did not make submissions.
Ward heard detailed argument about the Liberal party of NSW’s constitution and what should happen if it fails to hold its annual general meeting.
Last Thursday the NSW director, Chris Stone, presented legal advice to state executive stating that if it did not hold an annual meeting by the end of February they would soon be in breach of their constitution.
Counsel for Camenzuli, Scott Robertson SC, said the interpretation advanced in Thursday’s legal advice would result in the ex-officio (appointed) members of the state executive remaining, while those elected by the 500-member state council were terminated.
This, Robertson argued, “did significant violence” to the principles of the party.
Nicholas Bender, who appeared in the capacity of “friend of the court” to argue the alternate view in the earlier legal advice, said the ex-officio members would continue, but it was clear the constitution did not allow for the elected members to continue.
He said it was possible under his construction that a much smaller state executive could continue to meet and still have a valid quorum for an AGM of state council.
Ward has reserved her decision.
