Commissioner for Consumer Affairs v Brittain - [2007] SASC 381

SUPREME COURT OF SOUTH AUSTRALIA
(Magistrates Appeals: Criminal)
COMMISSIONER FOR CONSUMER AFFAIRS v BRITTAIN
[2007] SASC 381
Judgment of The Honourable Justice Gray
16 November 2007
CONTRACTS - BUILDING, ENGINEERING AND RELATED CONTRACTS
CRIMINAL LAW - APPEAL AND NEW TRIAL AND INQUIRY AFTER CONVICTION - APPEAL AND NEW TRIAL - APPEAL AGAINST SENTENCE - APPEAL BY ATTORNEY-GENERAL OR OTHER CROWN LAW OFFICER - APPLICATIONS TO INCREASE SENTENCE
CRIMINAL LAW - JURISDICTION, PRACTICE AND PROCEDURE - JUDGMENT AND PUNISHMENT - SENTENCE - FACTORS TO BE TAKEN INTO ACCOUNT - FACTUAL BASIS FOR SENTENCE
Appeal against penalty - respondent convicted by Magistrate on plea of guilty of the offences of carrying on business as a building work contractor without authorisation of a licence; failing to comply with the requirements in relation to a domestic building work contract; performing building work without a policy of insurance being in force; and demanding or requiring an unauthorised payment to be made for building work - Magistrate imposed the one fine of $2,500 - whether the penalty imposed was manifestly inadequate - Magistrate did not err in the exercise of his sentencing discretion - personal circumstances of the respondent warranted a merciful approach.
Building Work Contractors Act 1995 (SA) s 6, s 28, s 30 and s 34, referred to.
Sobey v Commercial Agents Board (1979) 22 SASR 70; Petracaro v Commissioner of Consumer Affairs (1994) 62 SASR 387; Police v Cadd (1997) 69 SASR 150; Hemming v Droulias (2000) 206 LSJS 389; House v The King (1936) 55 CLR 499 , considered.

COMMISSIONER FOR CONSUMER AFFAIRS v BRITTAIN
[2007] SASC 381
Magistrates Appeal
GRAY J
Introduction

This is an appeal against penalty.
On 7 August 2007, the respondent, Craig Edward Brittain, in the Adelaide Magistrates Court, was convicted on his plea of guilty of the offences of carrying on business as a building work contractor without authorisation of a licence;[1] failing to comply with the requirements in relation to a domestic building work contract;[2] performing building work without a policy of insurance being in force;[3] and demanding or requiring an unauthorised payment to be made for building work.[4] The Magistrate imposed a single fine of $2,500. In addition the respondent was ordered to pay a Victims of Crime levy of $280 and costs of $375.
[1] Contrary to section 6(1)(a) of the Building Work Contractors Act 1995 (SA), which provides:
(1) A person must not—
(a)carry on business as a building work contractor except as authorised by a licence under this Part; or
…
Maximum penalty: $20 000.
[2] Contrary to section 28(2) of the Building Work Contractors Act 1995 (SA), which provides:
(1) The following requirements must be complied with in relation to a domestic building work contract:
(a) the contract must be in writing;
(b) the contract must set out in full all the contractual terms;
(c) the contract must set out the name in which the building work contractor carries on business under the contractor's licence, the contractor's licence number and the names and licence numbers of any other persons with whom the contractor carries on business as a building work contractor in partnership;
(d) the contract must comply with any requirements of the regulations as to the contents of domestic building work contracts;
(e) the contract must be signed by the building work contractor and the building owner personally or through an agent authorised to act on behalf of the contractor or building owner;
(f) the building owner must be given a copy of the signed contract as soon as reasonably practicable after it has been signed by both parties together with a notice in the prescribed form containing the prescribed information;
(g) the copy of the contract and the notice given to the building owner must (apart from signatures or initials) be readily legible.
(2)If any of the requirements of subsection (1) is not complied with, the building work contractor is guilty of an offence.
Maximum penalty: $5 000.
[3] Contrary to section 34 of the Building Work Contractors Act 1995 (SA), which provides:
A building work contractor must not perform building work to which this Division applies unless—
(a)a policy of insurance that complies with this Division is in force in relation to that building work; and
(b)in the case of building work to be performed by the contractor under a domestic building work contract—the building owner has been provided with a certificate that evidences the taking out of that policy of insurance and complies with the requirements of the regulations.
Maximum penalty: $20 000.
[4] Contrary to section 30 of the Building Work Contractors Act 1995 (SA), which provides:
(1)A person must not demand or require that a payment be made under a domestic building work contract or preliminary work contract by the person for whom work is to be performed under the contract unless the payment—
(a) constitutes a genuine progress payment in respect of work already performed; or
(b) is of a kind authorised under the regulations.
Maximum penalty: $5 000.
(2)If it is proved, in proceedings for an offence against subsection (1), that the defendant received a payment other than a payment referred to in paragraph (a) or (b), it is to be presumed, in the absence of proof to the contrary, that the defendant demanded or required the payment.
(3)The building owner under a domestic building work contract is not obliged to make a progress payment in respect of building work performed under the contract unless the building work contractor has requested the payment by notice in writing given to the building owner or an agent authorised to act on behalf of the building owner.
(4)In this section—
“preliminary work contract” means a contract—
(a) that is collateral to or otherwise related to an existing or contemplated domestic building work contract; and
(b) that provides for the performance of work that is preliminary or ancillary to the domestic building work that is or would be required to be performed under such contract.
The complainant, the Commissioner for Consumer Affairs, has appealed, contending that the penalty imposed by the Magistrate was, in all the circumstances, manifestly inadequate.
The Chronology of Events
On 21 March 2004, the respondent and his wife signed a franchise agreement with Hire-a-Hubby Pty Ltd, a franchisor, with franchisees providing home maintenance and “handyman” work.
In about July 2004, Catherine Bell engaged the respondent, her neighbour, to perform building work at her premises at 10 Columbia Street, Paralowie. That work included concreting a driveway and the installation of a carport with a roller door. The respondent quoted $27,000 to perform the work. Ms Bell orally accepted the quote. There was no written contract between the parties. At no material time was the respondent licensed as a building work contractor.
In about September 2004 the respondent commenced the building work. He performed the work himself, sometimes with assistants. The respondent failed to take out a policy of building indemnity insurance.
Ms Bell paid a deposit of $5,000. Three further periodic payments of $5,000 were made. Upon completion of the work, Ms Bell declined to pay the balance of the contract price due to her dissatisfaction with the standard of the building work.
In March 2005, Ms Bell lodged a complaint with the Office of Consumer and Business Affairs regarding the standard of the building work. Efforts to conciliate the dispute failed. During the course of conciliation, it was discovered that the respondent was not a licensed building work contractor.
During April 2005, Ms Bell received quotations from builders to remove the building work. The quotations ranged between $16,478 and $24,750. Between July 2005 and September 2005 Ms Bell received quotations from builders to rectify and re-build the carport and driveway. The quotations were $49,895 and $63,000 respectively.
Preliminary Matters
Restrictions on prosecution appeals against sentence do not apply in relation to an appeal against a non-custodial sentence.[5] Nevertheless, the appellant must still establish that the sentencing discretion miscarried in a material way.[6] As Bleby J observed in Hemming v Droulias:[7]
The appellant must nevertheless establish that in some material way the sentencing discretion reposed in the magistrate miscarried, and that proper grounds are established which require this Court to interfere with the exercise of the magistrate’s discretion, such as the grounds referred to in House v The King (1936) 55 CLR 499 at 505. It is not sufficient for this Court merely to conclude that it would have imposed a higher sentence than that imposed by the sentencing magistrate.
[5]    Police v Cadd (1997) 69 SASR 150 at 159; Hemming v Droulias (2000) 206 LSJS 389 at 392.
[6]    House v The King (1936) 55 CLR 499 at 505; Hemming v Droulias (2000) 206 LSJS 389 at 392.
[7]    Hemming v Droulias (2000) 206 LSJS 389 at 392.
The purpose of the licensing regime is two-fold – to regulate and supervise those who perform work within the ambit of the regime; and, flowing on from that purpose, to afford members of the public protection from incompetent and unscrupulous traders.[8] As Olsson J observed in Petracaro v Commissioner of Consumer Affairs:[9]
The statute is primarily concerned with the protection of the public by ensuring that building work is not carried out by persons who are not suitably skilled or who are, or are likely to be, dishonest with those with whom they enter into contracts. It goes without saying that, in the case of a subcontract bricklayer who usually gives a firm price to a builder for quite specific work, is to be assessed mainly on his reliability and skill to do the job, whereas in the case of a category 1 building contractor the public concern must relate not only to technical ability but also general trustworthiness and honesty in negotiating and discharging contractual obligations.
[8] Sobey v Commercial Agents Board (1979) 22 SASR 70 at 72; Petracaro v Commissioner of Consumer Affairs (1994) 62 SASR 387 at 390.
[9] Petracaro v Commissioner of Consumer Affairs (1994) 62 SASR 387 at 390.
Circumstances of the Offending
The Magistrate summarised the circumstances of the offending as follows:
I note Mr Brittain and Ms Case that you are married. In 2004 you were jointly trading as a Hire-a-Hubby (Valley View – Walkley Heights). The business had been purchased some time earlier for a not insignificant amount of money and Mr Brittain I note was undertaking the manual side of the work – largely minor repair work – and his wife was undertaking the clerical side of the business. The business was traded with moderate success until about July 2004.
In July 2004 you entered into a verbal arrangement with your neighbours Mr and Mrs Bell – whose premises are at 10 Columbia Street, Paralowie – to construct a carport with roller door, a pergola, install a driveway and undertake additional works. The contract was for $27,000. You received a deposit of $5,000.
...
I am informed that there remains a serious dispute as to the cost of rectification. Proceedings are on foot in the District Court and are yet to be resolved. (It is unfortunate in my respectful view that the dispute as to rectification led to proceedings in the District Court as the cost involved of that litigation will be substantial).
With respect to the respondent’s personal circumstances, the Magistrate summarised the position as follows:
Following this investigation your business collapsed. I have read references that indicate you are both hardworking people who have suffered substantial financial loss and considerable personal stress as a consequence of the litigation surrounding the contract with the Bells and the failure of the business.
I am not sure why Mr Brittain … you wanted to take this work on. Perhaps there was some element of wanting to help out your neighbours. Perhaps it was the opportunity of making more significant income from what was a far more substantial job than the sort of handyman tasks you had done up to that date.
I note you have had to sell that house at Paralowie and move to Two Wells and take on further significant financial obligations. I note you are both working, but receive moderate income.
You both come to court without any prior conviction for any form of dishonesty or breach of legislative standards.
In arriving at what in his view was the appropriate penalty the Magistrate observed:
The purpose of the legislation is clearly set out in those previous authorities and I refer with respect to comments made by the former Chief Magistrate in the matter of Loader and to the Chief Justice’s comments quoted by Mr Prescott. I must ensure in imposing a penalty that not only is the penalty sufficient to act as a personal deterrent, but also that the penalty acts as a public deterrent so to discourage others who lack the appropriate skills, experience and business acumen from engaging in similar conduct.
Obviously any fine will present additional financial hardship. I am urged to consider not only your personal circumstances, the absence of prior history, the personal stresses that you have suffered as a result of the failure of the business, the fact that you no longer work in this industry and that there is no prospect of you returning to work in this industry. In the circumstances I consider that what might be generally regarded as a moderate fine for this type of offending is appropriate.
It was accepted by the appellant that there was no sentencing standard in relation to the respondent’s offending. However, it was contended that in all the circumstances the penalty imposed was manifestly inadequate. Counsel did not identify any specific sentencing error but submitted that the penalty was so low as to warrant the conclusion that an error had occurred, leading to a manifestly inadequate penalty. It was submitted that the following five factors allowed this conclusion: the prolonged nature of the offending; the significant loss sustained by Ms Bell; the lack of reparation; the significance of general deterrence to ensure the protective purpose of the licensing regime and the maximum penalties provided for the offences.
On the hearing of the appeal, it was pointed out that the Magistrate had not identified the reduction of penalty made on account of the respondent’s guilty pleas. It was said that this caused a difficulty in assessing the notional starting fine selected by the Magistrate. On the hearing of the appeal it was agreed that the plea was early and it would attract an appropriate reduction in the order of one quarter.
The respondent accepted that the fine imposed by the Magistrate could be fairly described as moderate. However, it was submitted that there were particular circumstances that warranted a merciful approach. It was contended that there was no need for personal deterrence. Attention was drawn to the severe financial hardship suffered by the respondent and his wife. This had led to personal suffering of such a nature that it was said that it could be confidently concluded that there would be no further offending against the provisions of the Act. Particular emphasis was placed on the prior good record of the respondent, his early plea and to the tendered character references.
The respondent and his wife have two children aged 9 and 13. The respondent’s wife has been forced to return to work having left the workforce eight years earlier to raise her children. They have been forced to sell their home and move to a home further from Adelaide. The franchise had to be sold incurring losses of the order of $40,000.00. The respondent has returned to his earlier occupation of interstate truck driving – an occupation he left to be able to spend more time with his family. The personal circumstances of the respondent and his wife were pertinent to the penalty to be imposed.
The respondent drew attention to the ongoing court dispute in regard to damages claimed by Ms Bell. Although that dispute is yet to be resolved, it is obviously a financial burden to the respondent and his wife to meet the on-going costs associated with that dispute, with the further potential of having to pay a substantial damages award if Ms Bell makes out her claim.
A primary sentencing consideration was the need for general deterrence. In that respect the respondent submitted that any reader of the Magistrate’s remarks would understand that the Magistrate was not de-valuing the importance of deterrence, but rather had adopted a merciful approach to sentencing having regard to the financial hardships and personal problems that confronted the respondent and his wife.
Conclusion
I am satisfied that the Magistrate did not err in the exercise of his sentencing discretion. The penalty imposed, although modest, when all the relevant circumstances are understood, may be seen to be an appropriate sentence for the offending.
This appeal is dismissed.