COMMISSIONER FOR CONSUMER PROTECTION and ABC REAL ESTATE
[2015] WASAT 118
•27 OCTOBER 2015
JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL
ACT: REAL ESTATE AND BUSINESS AGENTS ACT 1978 (WA)
CITATION: COMMISSIONER FOR CONSUMER PROTECTION and ABC REAL ESTATE [2015] WASAT 118
MEMBER: JUSTICE J C CURTHOYS (PRESIDENT)
MR D MACLEAN (MEMBER)
MR R ADAMS (SESSIONAL MEMBER)
HEARD: 13 OCTOBER 2013
DELIVERED : 27 OCTOBER 2015
FILE NO/S: VR 170 of 2015
BETWEEN: COMMISSIONER FOR CONSUMER PROTECTION
Applicant
AND
ABC REAL ESTATE
Respondent
Catchwords:
Licensed director - Person in bona fide control - Appointment of supervisor
Legislation:
Real Estate and Business Agents Act 1978 (WA), s 29, s 93
Result:
Orders made appointing supervisor under s 93 of the Real Estate and Business Agents Act 1978 (WA)
Summary of Tribunal's decision:
The Commissioner for Consumer Protection made application to the Tribunal under s 93 of the Real Estate and Business Agents Act 1978 (WA) in relation to ABC Real Estate which was carrying on a business as a real estate agent in Western Australia.
The Tribunal was satisfied that ABC Real Estate was not conducting its business in accordance with the Act.
The Tribunal made orders that ABC Real Estate be suspended from carrying on business; the company's servants or agents be restrained from dealing with all of its bank accounts; and that a supervisor be appointed under s 93 of the Real Estate and Business Agents Act 1978 (WA).
Category: B
Representation:
Counsel:
Applicant: Ms K La
Respondent: N/A
Solicitors:
Applicant: Department of Commerce
Respondent: N/A
Case(s) referred to in decision(s):
Nil
REASONS FOR DECISION OF THE TRIBUNAL:
Introduction
On 8 October 2015, the Commissioner for Consumer Protection (the Commissioner) made application to the Tribunal under s 93 of the Real Estate and Business Agents Act 1978 (WA) (the Act) for orders that:
1. Pursuant to section 93(1)(a) of the Real Estate and Business Agents Act 1978 (Act) the Respondent be suspended from carrying on its business until further order of the Tribunal.
2.Pursuant to section 93(1)(b) of the Act the Respondent and its servants and agents be restrained from dealing with all of the bank accounts related to or for the purpose of the Respondent's practice as an agent.
3.Pursuant to section 93(1)(c) of the Act, the Applicant be authorised to appoint a supervisor to the business of the Respondent.
4.Pursuant to section 93(3)(a) of the Act, any supervisor appointed under order 3 be empowered to withdraw any moneys from any bank account of the Respondent.
5.The Supervisor shall cause a notice to be issued to each financial institution with which the Respondent held an account informing them of any appointment and the power to transact upon the accounts.
6.The parties have liberty to apply.
Background
On 13 October 2013, the Tribunal made interim orders, including an order that the matter be dealt with on the documents.
The matters set out below are verified by the affidavit of Mr Matthew Damien Ormston sworn on 8 October 2015, filed in support of the application. References below to page numbers are to page numbers in Mr Ormston's affidavit. We have substantially adopted the Commissioner's submissions in these reasons.
The respondent carries on a real estate business under the business name 'ABC Real Estate Perth' (ABC) and holds a real estate and business agent's licence and triennial certificate. ABC's triennial certificate is current and expires on 14 October 2016 (page 3).
Ms Mercuri is the person in bona fide control of ABC. Ms Mercuri held a real estate business agent's licence and triennial certificate. Ms Mercuri's triennial certificate expired on 6 August 2015 (page 3).
The Act
In order for a corporate body to hold a real estate and business agents licence (licence), one of its directors must hold a personal licence (s 29 of the Act), that is, a licensed director and the licensed director must be in bona fide control of the business (page 4).
ABC has not had a licensed director or a licensed person in bona fide control since 6 August 2015 (page 4).
Since 2014, the Department of Commerce has received a total of 14 complaints from clients of ABC in relation to the alleged failure of ABC to pay moneys owed to these owners. These complaints include complaints from owners who have not received their end of month rental payments for July, August and September 2015 (page 4).
The Commissioner's Statement of Issues, Facts and Contentions
Issues
The Commissioner states that the following issues arise in this matter:
1.1.whether, by reason of not being qualified in terms of sections 29(c) and 29(d) of the Real Estate and Business Agents Act 1978 (Act), the Respondent is not conducting its business in accordance with the Act; or
1.2. in the alternative, whether by the Respondent surrendering its licence and triennial certificate it is no longer capable of properly conducting its business; and
1.3.whether in those circumstances the Tribunal should make orders pursuant to section 93 of the Act:
1.3.1.suspending the Respondent from carrying on business until further notice from the Tribunal;
1.3.2.restraining the Respondent and its servants and agents from dealing in all of the bank accounts related to or for the purpose of the Respondent's practice as an agent until further notice from the Tribunal; and
1.3.3.authorising the Applicant to appoint a supervisor to the business of the Respondent.
Facts
1.On 10 September 2010, the Respondent was registered as a proprietary company with the Australian Securities and Investments Commission ('ASIC').
2.The Respondent holds a current real estate and business agent's licence and triennial certificate granted on 15 October 2013.
3.The Respondent carries on the business of a real estate agent under the business name ABC Real Estate Perth.
4.Tanya Marie Mercuri is the sole director and person in bona fide control of the Respondent.
5.Ms Mercuri held a real estate and business agent's licence and triennial certificate that expired on 6 August 2015 (Licence).
6.On 12 May 2015 and again on 10 July 2015, the Applicant sent letters to Ms Mercuri advising that her Licence was due to expire and required renewal.
7.On 5 August 2015, a representative of the Applicant attended the Respondent's principal place of business at Unit 3/2 West Road, Bassendean. There was a notice on the door of the business stating that the owner had taken possession of the premises and that anyone who entered the premises would be trespassing.
8 On 28 August 2015 the Applicant received in the mail the Respondent's original licence and triennial certificate. No other documents were included with the licence and triennial certificate.
9.On 7 September 2015, the Applicant sent a further letter to Ms Mercuri advising that her Licence had expired and she is no longer authorised to carry on business as an agent.
10.Ms Mercuri has not responded to any of the Applicant's letters and has not applied to have her Licence renewed.
11.On 5 October 2015, the Applicant sent an email and attached a letter to the Respondent indicating the Applicant's intention to make an application to the State Administrative Tribunal for orders to appoint a supervisor to its business.
12.The Respondent has not had a licensed director or a licensed person in bona fide control since 6 August 2015.
13.The Respondent holds two trust accounts with the Westpac Banking Corporation in the name of:
•ABC Real Estate WA Pty Ltd T/AS ABC Real Estate Perth Reba Trust A/C - Rentals - T/C 62024 with BSB 036033 and account number 235265 (Rental Account); and
•ABC Real Estate WA Pty Ltd T/AS ABC Real Estate Perth Reba Trust A/C - Sales - T/C 62024 with BSB 036033 and account number 235249 (Sales Account)
14.As at 15 September the Respondent's Rental Account had a balance of $21,594.24 and the Sales Account had a balance of $0.
15.As at 5 October 2015 the Respondent had two rental listings on the website for the properties located at 27 William Street, Midland and 85A Hamilton Street, Bassendean.
Contentions
16.Section 29(c) of the Act provides that a body corporate may continue to hold a licence if, where there are not more than three directors of the body corporate, at least one is licensed.
17.Section 29(d) of the Act provides that a body corporate may continue to hold a licence provided the person in bona fide control of the business operated under the licence is licensed.
18.The Respondent has not had a licensed director or a licensed person in bona fide control appointed within the corporate structure since 6 August 2015.
19.Since 6 August 2015, the Respondent has not been qualified to continue to hold its licence pursuant to section 29(c) and 29(d) of the Act in that it does not have a director and person in bona fide control of the business that is licensed.
20.In these circumstances, the Respondent is not conducting its business in accordance with the Act.
21.Alternatively, if by returning its original licence and triennial certificate to the Applicant on 28 August 2015 the Respondent has surrendered its licence, then the Respondent is unable to lawfully distribute the monies that remain in its Rental Account because to do so would be to act as a real estate agent without a licence.
22.In these circumstances the Respondent is incapable of properly conducting its business.
23.It is necessary for the protection of the public and the completion of the Respondent's outstanding business that:
20.1the Respondent be suspended from carrying on business;
20.2the Respondent and its servants or agent be restrained from dealing with all of the Respondent's bank accounts; and
20.3a supervisor be appointed pursuant to section 93 of the Act to ensure that the outstanding business of the Respondent, in particular the payment of monies owed to clients of the business and the audit of the trust account of the business, is completed in accordance with the requirements of Part VI of the Act.
Conclusion
The Tribunal is satisfied that the facts are proved by the affidavit of Mr Ormston.
The Tribunal is also satisfied that the applicant's contentions support the orders sought by the applicant.
Orders
Accordingly, the Tribunal makes the following orders:
1.Pursuant to s 93(1)(a) of the Real Estate andBusiness Agents Act 1978 (WA), the respondent be suspended from carrying on its business until further order of the Tribunal.
2.Pursuant to s 93(1)(b) of the Real Estate and Business Agents Act 1978 (WA), the respondent and its servants and agents be restrained from dealing with all of the bank accounts related to or for the purpose of the respondent's practice as an agent.
3.Pursuant to s 93(1)(c) of the Real Estate and Business Agents Act 1978 (WA), the applicant be authorised to appoint a supervisor to the business of the respondent.
4.Pursuant to s 93(3)(a) of the Real Estate and Business Agents Act 1978 (WA), any supervisor appointed under order 3 be empowered to withdraw any moneys from any bank account of the respondent.
5.The supervisor shall cause a notice to be issued to each financial institution with which the respondent held an account informing them of any appointment and the power to transact upon the accounts.
6.The parties have liberty to apply.
I certify that this and the preceding [12] paragraphs comprise the reasons for decision of the State Administrative Tribunal.
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JUSTICE J C CURTHOYS, PRESIDENT
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