South Head Synagogue: the rabbi is back in his pulpit

June 26, 2017 by J-Wire
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Rabbi Benzion Milecki remains as the spiritual head of Sydney’s South Head Synagogue after the Supreme Court of NSW ruled that his termination was void.

Rabbi Benzion Milecki

The fate of Sydney’s South Head Congregation will lie within hoped-for negotiations between its rabbi of 32 years, its board and its administrator with a possibility of a move by the administrator locking out the members from the building shortly.

The story so far. The board failed to do a deal with Rabbi Benzion Milecki which would have seen him leave the congregation. The cash-strapped shul is a debt to Westpac which was paid out by three members who funded a loan to the congregation of $500,000 equally. The shul was put into administration and the administrator terminated the rabbi’s employment…a termination the rabbi refused to accept. The Supreme Court in NSW found the termination was void and ruled that the matter had to be heard by a Din Torah which would decided if the rabbi was to be terminated. The court awarded the costs to Rabbi Milecki.

President James Hochroth wrote the members saying: “As you are aware, last Thursday the NSW Supreme Court stated that the termination by the Administrator of Rabbi Benzion Milecki was invalid and the Administrator must treat him as the continuing rabbi of our synagogue.

Yet, to continue to do so will see our Shule plunge into liquidation.  Indeed, the very existence of our beloved South Head Synagogue now rests in the hands of Rabbi Milecki.  If he does not resign (with a fair financial settlement, in line with the award of a Beth Din in similar matters), there will be no future for our Shule and liquidation will commence.  There is no viable alternative.

The only chance left for the Shule to survive, is if Rabbi Milecki decides to CHOOSE LIFE for the Shule, and not be the author of the demise of his once thriving Kehillah.”

David Balkin, a members of the Synagogue’s advisory committee, wrote: “The Shule is in administration because it is operating on the point of insolvency.

The decision by the Court to reinstate the Rabbi has acutely worsened the financial situation given the Shule’s costs have now increased by 30% and its revenue base is eroding again.
Within an hour of the Court’s decision, two families called the Shule to cancel their credit card authorisation.”

He added: It has demonstrated that the South Head kehillah can be vibrant, financially and economically viable without Rabbi Milecki in the pulpit.”

The situation has reached a crescendo: either the Rabbi agrees to go or the Shule will be put into liquidation in the next two weeks.”

Rodney Naumberger is also a member Financial Advisory Committee and one of the three who loaned the synagogue, He also wrote to members saying: “We the secured creditors together with the Board, believe we could formulate a Deed of Company Arrangement that would allow the synagogue to come out of administration and be put back in the hands of the Board.

However, that Deed of Company Arrangement is dependent on the Rabbi vacating the pulpit.
We cannot see a situation where a Deed of Company Arrangement could be put in place with the Rabbi in the pulpit as confirmed by the recently conducted survey that revealed:
The vast majority (over 70%) of the community are looking for urgent rabbinical renewal.
For them this means a new rabbi who will appeal to families with younger children and teenagers who has the latitude to put his stamp on the Shule without interference from Rabbi Milecki.
The Shule has lost 35% of its membership in the last few years.
At least 27% of the current membership has indicated that they too will cease their membership if there is no rabbinical renewal.
A further 21% are also at risk for unknown reasons. As such, we would have a totally collapsing revenue base.
The Rabbi’s remuneration is excessive and unaffordable. He has continually threatened legal action if there was ever any attempt to reduce his remuneration.”
J-Wire understands the rabbi’s remuneration is $380,000. The rabbi also claims expenses over and above this.
But member Robert Krochmalik wrote to James Hochroth, Curtis Manne, Rodney Numberer and David Balkin: “Let me place on the record that Curtis Mann rang me on Thursday night at about 9.30 pm from Gary Cohen’s place and told me we needed to come to an agreement that night. I asked if we could meet and negotiate the next day Friday afternoon and Curtis told me, in explicit terms, and in front of Gary Cohen, that it was not settled by Thursday night then it would be too late and that the Shul would be liquidated on Friday.Curtis also advised me, again in front of Gary Cohen, that you planned to start a public relations campaign to malign the Rabbi and drive him out of Sydney.

Rodney may call that wanting to negotiate. I call it bullying. The Rabbi was out and I had urgent things to attend to and could not come at a moment’s notice. There was no point communicating again on Friday as Curtis made it very clear. Either come to a deal on Thursday night or else liquidation the next day. I asked him to elaborate and he said he couldn’t or wouldn’t.

Please read my comments below. The final decision about the life and death of the Shul is in the hands of the three secured creditors.

I hope common sense prevails but if it does not then it will be on your heads. Not mine. Not Gary’s. Not Kevin’s and not the Rabbi’s.”

Robert Krochmalik then referred to another he mail he sent in which he wrote: “I can’t believe that Mr Hochroth can still call himself President.

According to the Constitution only a board member can be President and Mr Hochroth’s office as a Board member was vacated when he took a mortgage over Shul property.

Bottom line is that the creditors will vote at the creditors’ meeting, not the members.

When you paid off Westpac, I immediately believed that what you were doing was seeking to control the DOCA (Deed of Company Arrangement). And so it turned out to be. You did so without seeking approval or agreement from the membership base. This Company is a Public company.

The Directors have certain obligation under the Corporations Act to act in the interests of the Company and its members you have a fiduciary duty to do so.

How can you say that the matter rests in the hands of Rabbi Milecki? Everyone is fully aware that now the three secured creditors will carry the day. The Rabbi’s vote will not count. The members are not even given the right to vote.

The choice is yours.

Vote for liquidation and it will be your votes that will put an end to the Shul. Everyone will see it as a means for you to get your money back at the expense of the members.

On the other hand if you vote to keep the Shul out of liquidation, resign your positions, and allow a new Board to arrange funding for the Shul’s survival, then the members will still have a Shul.

It’s over to you and to your cohorts. You can choose life for your beloved Shul. Or you can choose death.  The choice is not the Rabbi’s . It is your choice.

In the end, everyone will know who voted at the creditors’ meeting and what was the result.

BTW the Court did not say that the purported termination was invalid, it said it was VOID.

And read Order 3. The Shul has to pay the Rabbi’s costs. The legal costs of the Shul and the Rabbi could have been better spent. No wonder the Shul has no money. Because the Board has chosen to spend OUR money on surveys, insolvency advisors, Administrators , Solicitors, Barristers and now you have the ignominy of having to pay the Rabbi’s costs. But not with your own money. With the members’ money.

What about your fiduciary duty to act in the interests of all members?”

J-Wire has a barmitzvah scheduled for this weekend organised by long-term members, has been changed to the nearby Misrachi Shul.


4 Responses to “South Head Synagogue: the rabbi is back in his pulpit”
  1. Rodney Naumburger says:

    Yes, the secured creditors purchased the bank debt and that is why the community still has a synagogue. Otherwise, it may well be in the hands of a receiver.

    Just as Rabbi Milecki repeatedly endeavoured to sheet home the blame for the shul’s financial predicament on the past Boards, the Rabbi and his supporters are attempting to absolve the Rabbi of all responsibility for the Shul’s predicament and are trying to thrust responsibility for the Shul going into liquidation onto the secured creditors. The Shul’s perilous financial predicament has accumulated over many years. Wages, as a percentage of income, is grossly out of proportion to all comparable Australian synagogues and ongoing adjusted net losses incurred since 2009 total $1.8 million (per independent insolvency firm McGrath Nicol report to the congregation in February 2017). Rabbi Milecki has been a shadow director for the past 32 years – he, himself, says that he was the “driver” of all initiatives.

    The Rabbi has been aware of the dire financial situation since at least 2014.
    Rabbi Milecki stated in his 2014 offer to the board “The synagogue is overcommitted financially leading to annual deficits” and went on to state “for all intents and purposes, I have been the driver (with the support of the board) of all major and minor initiatives for 30 years”.

    It appears that the Rabbi’s two most outspoken and voluble supporters know better than the two highly respected insolvency experts Anthony Elkerton (the Administrator) and Barry Kogan (partner at McGrath Nicol) who have been through the books and records of the Shule. There is no point in calling for the Board or the Finance Committee’s resignation. The only person that has any powers is the Administrator. In the absence of any agreement for Rabbi Milecki to leave, the only way ahead is liquidation.

  2. Ari says:

    Sitting in Johannesburg reading this saga with great interest.What a sad game is being played here at the expense of Yiddishkeit.Seems to me that the Rabbi has an ego the size of the Kimberley Hole and was given unfettered power to do as he pleased,which has eventuated in this situation.If the rabbi was respected so much how come the vast majority want him to leave.I suspect that this is another attempt by Chabad to take over another kehilla as they did in Joburg to one of the shuls and have done in parts of Europe.

  3. Harold says:

    The Board don’t need lessons from Krochmalick about their duties.
    He should be start being a bit more objective.

  4. Ron Burdo says:

    This “Rabbi” is like the sons of Eli the chief priest, which are described in the book of Samuel, chapter 2.
    Not only he should be sacked, he should be revoked of his Rabbinical authority.

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