COMMISSIONER FOR CONSUMER PROTECTION and IJR PROPERTY PTY LTD
[2020] WASAT 138
•15 OCTOBER 2020
JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL
ACT: REAL ESTATE AND BUSINESS AGENTS ACT 1978 (WA)
CITATION: COMMISSIONER FOR CONSUMER PROTECTION and IJR PROPERTY PTY LTD [2020] WASAT 138
MEMBER: PRESIDENT PRITCHARD
HEARD: 15 OCTOBER 2020
DELIVERED : 15 OCTOBER 2020
PUBLISHED : 5 NOVEMBER 2020
FILE NO/S: VR 81 of 2020
BETWEEN: COMMISSIONER FOR CONSUMER PROTECTION
Applicant
AND
IJR PROPERTY PTY LTD
Respondent
Catchwords:
Section 93(1) of the Real Estate and Business Agents Act 1978 (WA) - Whether there are reasonable grounds for believing that agent not conducting business in accordance with the Act - Whether Commissioner should be authorised to appoint supervisor
Legislation:
Real Estate and Business Agents Act 1978 (WA), s 29, s 29(c), s 93, Sch 1, cl 6, cl 6(2)
Result:
Application granted
Category: B
Representation:
Counsel:
| Applicant | : | Mr S King |
| Respondent | : | No appearance |
Solicitors:
| Applicant | : | In Person |
| Respondent | : | No appearance |
Case(s) referred to in decision(s):
Nil
REASONS FOR DECISION OF THE TRIBUNAL:
(These reasons were delivered orally at the conclusion of the hearing. They have been edited to correct matters of grammar and infelicity of expression.)
Introduction
This is an application brought by the Commissioner for Consumer Protection (Application) pursuant to s 93 of the Real Estate and Business Agents Act 1978 (WA) (Act).
The respondent, IJR Property Pty Ltd, has not appeared at the hearing today. However, I am satisfied that the director of the respondent, Ms Sarah Mack, had notice of the hearing.
The first listing of the Application was on Tuesday this week. On that occasion, the Tribunal endeavoured to contact Ms Mack on the telephone numbers that had been provided, but was unsuccessful. I made orders adjourning the hearing of the Application until today at 9.30 am. The orders made clear that if the Respondent did not provide a phone number on which its representative could be contacted, the hearing may proceed and orders may be made in its absence.
Following that hearing, Ms Mack sent an email to the Tribunal[1] and to the Commissioner, which confirmed that she was aware of these proceedings and indicated that she had some difficulties with her mobile telephone coverage, which sometimes made calls difficult. I note, for the sake of completeness, that in the last line of her email Ms Mack advised that 'if possible it would be better to make [today's hearing] after 12'.
[1] On 13 October 2020 at 11.11 am.
There was, however, no formal request to adjourn the hearing until after 12.00 pm, notwithstanding that Ms Mack clearly had notice that the proceedings had been listed this morning at 9.30am.
The staff of the Tribunal have tried a number of times this morning to telephone Ms Mack on the telephone number provided to the Tribunal, including during the course of the hearing, without success.
In those circumstances, I am satisfied that it is appropriate to proceed with the Application as the respondent has chosen not to ensure that there was an appearance on its behalf today, despite the fact that the Tribunal's last order made clear that it was imperative that the respondent advise the Tribunal of a telephone number on which its representative could be contacted, failing which the hearing may proceed.
The Application
The Application was filed on 7 October 2020, accompanied by the grounds for the application which were set out in terms of a statement of issues, facts and contentions. The Application was supported by an affidavit sworn by Mr Robert George Stirling on 7 October 2020.
The Application is made under s 93 of the Act, which permits the Commissioner to apply to the Tribunal and, where the Tribunal is satisfied that there are reasonable grounds for believing that either of two things have occurred, the Tribunal may take various actions, including to suspend an agent from carrying on business and to authorise the Commissioner to appoint a supervisor to the business of the agent.
The two grounds for the Tribunal to make those orders are, in the alternative: that there are reasonable grounds for believing that an agent is, for any reason, incapable of properly conducting the business; or that there are reasonable grounds for believing that the agent is not conducting the business in accordance with the Act. The Commissioner relies on the second of those grounds.
The evidence before the Tribunal
The evidence relied upon by the Commissioner in support of the grounds advanced in the Application permits the following conclusions to be drawn. From 13 April 2017 to today, Ms Mack has been a director of the respondent. The respondent carries on its business under the business name IJR Property. It holds a real estate and business agent's licence and a triennial certificate. Ms Mack herself held a real estate and business agent's licence and triennial certificate until August 2019, at which time her triennial certificate expired. She has not applied for the renewal of that triennial certificate. She also does not appear to hold a certificate as a real estate or business sales representative.
In 2019, the Commissioner became aware that the respondent did not have a licensed director or person in bona fide control. That was because Ms Mack was the only director of the Respondent and the only person licensed as a real estate and business agent. At that point, the Commissioner commenced proceedings in the Tribunal for the appointment of a supervisor.
Ultimately, it was not necessary to pursue those proceedings and they were withdrawn, because the respondent appointed another person as a director and that person had the appropriate licence and certification. That person was removed in December 2019 and it appears that another licensed person was appointed in March 2020. On or about 1 July 2020, that person was removed as a director of the respondent.
On the basis of the material before the Tribunal, there is nothing to indicate that since 1 July 2020 the respondent has had a director who has held the licensing and certification requirements that the Act requires.
Relevant requirements for conducting a business in accordance with the Act
Section 29 of the Act requires that a body corporate may apply to the Commissioner for a licence and may hold a licence in certain circumstances. One of those circumstances is outlined in paragraph (c) '…where there are not more than 3 directors of the body corporate at least one of them is licensed' in accordance with the Act. The triennial certificate can then be applied for, which permits the right to carry on a business for a period of three years at a time.
Under Sch 1, cl 6 of the Act, there is effectively a period of grace that is available to a body corporate if the situation arises that a licensed director either dies or withdraws from the business. This grace period is a three-month period which is available if, immediately after the withdrawal of the licensed director, the company gives the Commissioner written notice of the withdrawal. From that point in time, subject to any conditions imposed by the Commissioner, the business may carry on for a period of three months. Clause 6(2) of Sch 1 to the Act makes clear that where the body corporate carries on business pursuant to that clause, the business is deemed to have been carried on by the licensee and the holder of the current triennial certificate without interruption by reason of the death or withdrawal of the licensed director.
The Respondent is not carrying on business in accordance with the Act
The grace period afforded by the Act has been relied upon by the respondent on each of the two occasions to which I have previously referred, when a licensed director left and another was appointed to the Respondent. These were periods where the company was operating without a licensed director in bona fide control. The consequence of cl 6 of Sch 1 to the Act, however, appears to be that while the respondent has not had a licensed director in bone fide control, in accordance with the Act, since 1 July 2020, it has arguably been deemed to be carrying on business, in compliance with the Act, without interruption, until 1 October 2020.
That is because the latest period of grace expired on 20 September 2020, three months after 1 July 2020, but no licensed director has been appointed. There is one final matter to which I should refer by way of completeness. In September and October 2020, inquiries and investigations were undertaken by officers of the Commissioner to ascertain whether the respondent continues to carry on business as a real estate agent. The evidence set out in the affidavit of Mr Stirling suggests that that is the case, as there seems to have been active transactions on the trust account for the receipt of rent.
Consequently, on and from 1 October 2020, the Respondent has been carrying on business other than in compliance with the requirements of the Act.
In those circumstances, which are established by the affidavit of Mr Stirling, I am satisfied that there are reasonable grounds to believe that the respondent is not conducting its business in accordance with the Act. That enlivens the powers in s 93 of the Act.
I am content to rely on the power conferred by s 93 of the Act to make the orders that are sought in the Commissioner's minute of orders. The orders sought by the Commissioner are to suspend the respondent from carrying on its business; to restrain the Respondent's dealings with its bank accounts; to authorise the Commissioner to appoint a supervisor; to authorise the supervisor to withdraw moneys from any bank account of the respondent; and to require the service of notice of the orders on the parties affected by them, namely, the bank in question. The minute also includes an order that any person affected by the orders will have liberty to apply to vary them on 48 hours' notice. I make that observation particularly because I am cognisant of the fact that perhaps there have been difficulties for the respondent in participating in the proceeding today. I have, however, been content to proceed in the circumstances because I am satisfied that the respondent has had notice and has had every opportunity to ensure that an appearance can be organised and has failed to do so. Nevertheless, given the history of the matter, Ms Mack may be endeavouring to put in place alternative arrangements to manage the Respondent. If she secures alternative arrangements satisfactory to the Commissioner, she may wish to avail herself of the liberty to apply order that I now propose to make.
Orders
The Tribunal orders that:
1.Pursuant to s 93(1)(a) of the Real Estate and Business Agents Act 1978 (RE Act), the respondent be suspended from carrying on its business until further order of the Tribunal.
2.Pursuant to s 93(1)(b) of the RE Act, the respondent, its bankers and their respective servants and agents be restrained from dealing with all or any of the bank accounts related to or for the purpose of the respondent's practice as an agent.
3.Pursuant to s 93(1)(b) of the RE Act, the Australian and New Zealand Banking Group Limited (ANZ) and its servants and agents be restrained from dealing with the following accounts:
(i)[redacted]
(ii)[redacted]
(iii)[redacted]
4.Pursuant to s 93(1)(c) of the RE Act, the applicant be authorised to appoint a supervisor to the business of the respondent.
5.Pursuant to s 93(3)(a) of the RE Act, any supervisor appointed under order 4 be empowered to withdraw any moneys from any bank account of the respondent referred to in order 3.
6.The supervisor shall cause a notice to be issued to each financial institution with which the respondent held an account informing them of the appointment and the power to transact upon the accounts.
7.The applicant shall cause a copy of these orders to be served upon ANZ by:
(i)delivering a copy of these orders to the ANZ branch located at 239 Murray Street, Perth; and
(ii)emailing a copy of these orders to [email protected].
8.Any person affected by these orders has liberty to apply to vary them on 48 hours' notice.
9.The matter is adjourned for a further directions hearing on Thursday, 28 January 2021 at 9.30am to consider any further order which may be required and for the purpose of a report as to the progress of the supervision.
I certify that the preceding paragraph(s) comprise the reasons for decision of the State Administrative Tribunal.
EH
Associate to the Honourable Justice Pritchard5 NOVEMBER 2020
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