Royal Aero Club of WA is still going.
I don't know anything about this particular situation, but the whole thing of having committees full of amateurs who want cheap flying for themselves interfering with the running of the flying school is something I have seen over and over again. In the past I have managed aircraft on behalf of clubs, even with a very clear contract it has always ended with them telling me how to run my business, even "white anting" my own clients right under my nose. It only takes one rotten apple and every committee has one.
Might be easier just to pay tax like the rest of us.