COMMISSIONER FOR FAIR TRADING v BOWDITCH (Occupational Discipline)
[2019] ACAT 112
•31 July 2019
ACT CIVIL & ADMINISTRATIVE TRIBUNAL
COMMISSIONER FOR FAIR TRADING v BOWDITCH (Occupational Discipline) [2019] ACAT 112
OR 18/2019
Catchwords: OCCUPATIONAL DISCIPLINE – agent – application to strike out proceedings prior to hearing – test to be applied – not apparent proceedings must fail – strike out application dismissed
Legislation cited: ACT Civil and Administrative Tribunal Act 2008 ss 7, 32, 36, 56, 66
Agents Act 2003 s 41
Health Practitioner Regulation National Law Act 2009 (ACT)
Cases cited: Bell v de Castella & Anor [2014] ACAT 65
Church of Scientology v Woodward (1982) 154 CLR 25
Dey v Victorian Railways Commissioners (1949) 78 CLR 62
Fancourt v Mercantile Credits Ltd. (1983) 154 CLR 87
General Steel Industries Inc v Commissioner for Railways (1964) 112 CLR 125
Knight v FP Special Assets Ltd (1992) 174 CLR 178
Webster v Lampard (1993) 177 CLR 598
Tribunal: Presidential Member MT Daniel
Date of Orders: 31 July 2019
Date of Reasons for Decision: 4 December 2019AUSTRALIAN CAPITAL TERRITORY )
CIVIL & ADMINISTRATIVE TRIBUNAL ) OR 18/2019
BETWEEN:
COMMISSIONER FOR FAIR TRADING
Applicant
AND:
DAVID EDWIN BOWDITCH
Respondent
TRIBUNAL: Presidential Member MT Daniel
DATE: 31 July 2019
ORDER
The Tribunal orders that:
1. The application for interim or other orders filed 1 July 2019 is dismissed.
2. The respondent is to file and serve his response by 9 August 2019.
3. The applicant is to file and serve all evidence and written submission by 18 August 2019.
4. This matter is to be heard jointly with matter OR 8 of 2019 and directions 5 - 10 of 17 June 2019, as varied on that matter apply equally to this matter.
……………Signed……………
Presidential Member MT Daniel
REASONS FOR DECISION
1. These proceedings consist of an application for disciplinary action brought by the Commissioner for Fair Trading (the Commissioner) against David Edwin Bowditch (the respondent). On 31 July 2019 I made orders dismissing an application by the respondent for orders dismissing the disciplinary proceedings. I gave oral reasons for that decision and indicated I would publish those reasons in due course. Following is the edited transcript of the oral reasons.
Background
2. On 17 October 2018 the tribunal made orders in disciplinary proceedings brought against Murlton Pty Ltd, a licensed agent. Under the Agents Act 2003 (Agents Act), a company may only be licensed as an agent if one of its directors holds the requisite licence and there appears to be no dispute that at the time of making those orders, the respondent was the licensed director for Murlton Pty Ltd.
3. The orders made on 17 October 2018 were made by consent. It is not disputed the respondent was present when the orders were made and provided his agreement as director on behalf of the company for the orders being made.
4. Order 3 of those consent orders was directed at addressing what was perceived to be the company’s need for further education and training.
5. Of course, a company cannot itself complete further study. Order 3 was phrased to require “the licensed director” to undertake certain courses within a specified period. It’s now alleged the respondent, as the licensed director, has failed to undertake the specified courses within the prescribed time and that that failure constitutes a contravention by him of Order 3.
6. The Agents Act provides that contravention of an ACAT order by a licensed agent is a ground for occupational discipline under that Act. The Commissioner has consequently filed an application for disciplinary action against the company on the basis that it failed to comply with the consent orders and a second application for disciplinary action against the respondent as a licensed agent, alleging that he has contravened Order 3 of those consent orders.
7. The respondent on 1 July 2019 filed an interim or other orders application seeking that the disciplinary action against him be struck out “for want of jurisdiction” and costs (the strikeout application).
8. That strikeout application is supported by a witness statement of the respondent’s solicitor, Mr Mansfield, which goes beyond asserting facts to provide an opinion on some of the issues raised by the application. It also attaches a letter to the Commissioner of 21 June 2019, foreshadowing that if an application for disciplinary action was commenced against the respondent, it would be met with this strikeout application and an application for costs.
9. Nonetheless, as I’ve noted, the disciplinary application was filed and consequently the strikeout application was filed on 1 July 2019 and that strikeout application was listed for hearing before me on Friday 26 July 2019.
10. For the hearing of the strikeout application on 26 July 2019 the respondent was represented by counsel, Mr Masters, and the Commissioner also by counsel, Ms Katavic. Counsel for the respondent provided written submissions, and Counsel for both parties made oral submissions and provided authorities.
11. I reserved my decision and advised the parties I would give a decision as soon as possible, given that the disciplinary application in relation to the company is listed for hearing in September and if this matter was to proceed, it would make sense that it be listed at the same time, given many of the facts are the same.
12. I advised the parties that if I required any further submissions, I would notify them. As it transpired, I do not require further submissions.
13. I have considered the parties’ submissions and the cases referred to. I have concluded that it is not appropriate to dismiss the application for disciplinary action at this early stage. My reasons for that decision follow.
What is the legal framework for the strikeout application?
14. The first question of course is the correct legal framework to apply to the strikeout application. The strikeout application was expressed as being ‘for want of jurisdiction’. If brought solely on this basis, it seems to me that it must fail. This is because the tribunal’s jurisdiction to deal with an application in the occupational discipline area is enlivened by the filing of an application for occupational discipline.
15. As submitted by Ms Katavic, the Commissioner is required to bring such an application if satisfied on reasonable grounds that a ground for occupational discipline exists, and that is what they have done.
16. That is not to say, however, that every application ever filed must proceed through to a full and final hearing. This is notwithstanding that section 36 of the ACT Civil and Administrative Tribunal Act 2008 (the ACAT Act) specifically provides that the tribunal must ‘hear’ each application. I note in this respect what is meant by the word ‘hear’ in section 36 is unclear. It seems by its context to be a reference to a full, final, face to face hearing of the substantive application.
17. So there is a requirement imposed on the tribunal as a starting point that every application that is filed must be heard. But although section 36 imposes that duty to hear each application, the ACAT Act then provides the means by which the tribunal may decide at an earlier stage not to hear an application, and obviously that power is really important when you are trying to be quick and efficient and deal with matters inexpensively.
18. So for example, section 32 of the ACAT Act sets out that an application which is frivolous or vexatious or otherwise lacking in substance may be struck out at an earlier stage and in some cases costs awarded. Section 56 of the ACAT Act also provides the tribunal may take any other action in relation to an application that it considers appropriate and that would include entering summary judgment for an applicant or a respondent.
19. It seems to me that the arguments put on behalf of the respondent fall overlappingly into both the section 32 ‘frivolous and vexatious’ category, or ‘lacking in substance’ category, and also the section 56 summary judgment category. The arguments essentially posit the application should be dismissed by the tribunal because it can never be satisfied that the respondent is contravening or has contravened an order of the ACAT. In other words, this disciplinary application is doomed to fail.
20. This is not said to be because of factual matters going to whether or not the courses have been completed or not, but because it is argued he was never legally required to comply with Order 3 and therefore could not be said to contravene it.
21. In determining such an application, we would apply the established principles for entering summary judgment in the exercise of inherent power. Many of the other approaches to summary judgment are flavoured by court or tribunal rules which give some form and substance to the way that discretion is going to be exercised. The tribunal does not have such rules to give form to the exercise of the discretion provided by section 56 and so I think it would be appropriate to rely on the approach taken to the exercise of that inherent power, which is sometimes referred to as the ‘traditional’ approach.
22. As I have said, I think that the test for deciding this strikeout application should be analogous to the test for summary judgment for a defendant, in the absence of rules which provide a different test. That is the ‘traditional’ test applied by a court usually in its inherent jurisdiction, and I’d refer the parties to, for example, General Steel Industries Inc v Commissioner for Railways, which is quoted in every textbook.
23. The common starting point is the need for exceptional caution in exercising the power. The test has been described as being that the case must be so plain and obvious the court can say at once that the statement of claim, even if proved, cannot succeed. The approach described in Webster v Lampard has been expressed as being that it is apparent that the action must fail:
5. It is important to note at the outset that the issue before the learned Master on the application for summary judgment was not whether Mr and Mrs Webster would probably succeed in their action against Sergeant Lampard. It was whether the material before the Master demonstrated that that action should not be permitted to go to trial in the ordinary way because it was apparent that it must fail. The power to order summary judgment must be exercised with “exceptional caution” ((4) General Steel Industries Inc. v. Commissioner for Railways (N.S.W.) (1964) 112 CLR 125, at p.129.) and “should never be exercised unless it is clear that there is no real question to be tried” ((5) Fancourt v. Mercantile Credits Ltd. (1983) 154 CLR 87, at p.99.). As Dixon J commented in Dey v. Victorian Railways Commissioners ((6) (1949) 78 CLR 62, at p.91.):
“A case must be very clear indeed to justify the summary intervention of the court to prevent a plaintiff submitting his (or her) case for determination in the appointed manner by the court with or without a jury. The fact that a transaction is intricate may not disentitle the court to examine a cause of action alleged to grow out of it for the purpose of seeing whether the proceeding amounts to an abuse of process or is vexatious. But once it appears that there is a real question to be determined whether of fact or law and that the rights of the parties depend upon it, then it is not competent for the court to dismiss the action as frivolous and vexatious and an abuse of process.”
Nowhere is that need for exceptional caution more important than in a case where the ultimate outcome turns upon the resolution of some disputed issue or issues of fact. In such a case, it is essential that “great care ... be exercised to ensure that under the guise of achieving expeditious finality a plaintiff is not improperly deprived of his (or her) opportunity for the trial of his (or her) case by the appointed tribunal” ((7) General Steel Industries Inc. v. Commissioner for Railways (N.S.W.) (1964) 112 CLR, at p.130; see, also, Church of Scientology v. Woodward (1982) 154 CLR 25, at p.31.).
24. So it is perhaps the most stringent of the three approaches to summary judgment, in that it must appear that the proceeding is destined to fail, rather than other approaches which are more along the lines of “there is no real prospect of success” or that “there is no reasonable prospect of success”.
25. This approach is very similar to the test when considering if an application is ‘frivolous or vexatious’ because it is doomed to fail. Not because of any malice in bringing it, but because it has actually got no prospects of success.
26. So, whether it is brought pursuant to section 32 or section 56 of the ACAT Act, that is effectively the test that I have applied to the strikeout application in this case.
The miscellaneous arguments raised by the respondent
27. There are a number of arguments put by the respondent as to why the disciplinary proceedings against him must fail, and I will go through these in reverse order.
28. The argument is put that the orders are only capable, at law, of being enforced against the corporation. No authority was provided for that argument and it seems to me that it is an argument which probably hangs off the first argument, which is that final orders can only be made against parties.
29. So I am not persuaded that submission, that the orders are only capable of being enforced against the corporation, is correct and that therefore this proceeding must fail.
30. The argument was also put that the order does not name Mr Bowditch, but refers to a position or office, and therefore was not enforceable against him or he is not required to comply with it.
31. Again, no authority was provided for this proposition. Of course, we know as a matter of fact that orders often describe a person not by name but by reference to a position occupied, so we might, for example, have even the party to a proceeding or a party named in an order as being the trustee for the XYZ Family Trust. Who is the trustee changes from time to time, but it does not mean that the trustee at the relevant time is not obliged to comply with that order.
32. An order might be made for costs against the Commissioner for Fair Trading. That does not mean no one has to comply with it because an individual was not named.
33. The question is whether the person said to be bound by that order is sufficiently identified at the relevant point in time. So I do not consider the argument that Mr Bowditch is not bound to comply with the order because he is not named as an individual is determinative in this case.
34. The argument is next raised that Mr Bowditch had no standing to appeal Order 3. If a person is affected by orders while not technically a party, the usual practice of the tribunal is to add the party to the proceedings on their request, should their interests be affected, and they need only make a written application for that to occur. Once added as a party, that person might seek to appeal the orders affecting them.
35. It seems to me that it is a bootstraps argument to say that due to a lack of standing to appeal the orders are not binding on the person named in them. Particularly given that the joinder of such a person as a party would routinely be exercised in their favour, should they request.
36. The argument is also put that because there is an alleged breach by Murlton Pty Ltd, that Mr Bowditch could not have breached the order. I do not consider that the current grounds of disciplinary action, as phrased in the proceedings against the corporation, are determinative of the proceedings against Mr Bowditch. It does not seem to me obvious or self-evident that an order cannot bind two persons and that therefore two persons can’t breach it.
37. So I am not satisfied that on the basis of any of those arguments the outcome of these disciplinary proceedings is so obvious that it should just be dismissed at this early stage. But I do want to talk about the first ground raised by the respondent, Mr Bowditch, which I think is a ground of some merit and warrants further consideration.
The main argument
38. So the first, and I think best, argument put on behalf of the respondent was that final orders can only be made against parties. No authority was cited for this proposition, but we are all familiar with it; it is a long-established principle and has its foundations, as Mr Masters said, in the principles of natural justice.
39. But in fact, there are a lot of exceptions to this principle and we are also familiar with them. So for example in the seminal case of Knight v FP Special Assets in which the High Court found that costs could be awarded against a non-party, what the High Court said, itself not citing an authority for the proposition that an order cannot be made against a non-party, the High Court said, well yes, that is a long-established principle and we accept that, but look at the specific statute to see what power is given. And the High Court looked at the costs power and determined that there was no basis in the costs power provided by the rules for departing from the plain wording of the rule, which permitted orders being made against anyone. And in the circumstances, they thought that there was no basis on which to narrowly interpret that power in a way that the legislature had not itself confined it.
40. So what we get from that case is that even though as a starting principle and perhaps because of natural justice, courts and tribunals do not make orders against non-parties, that principle has to be applied subject to any specific legislative provisions. In other words, go back and look at your Act.
41. When you go back and look at section 66 of the ACAT Act, this sets out the orders the tribunal may make in disciplinary proceedings ‘in relation to the subject person’:
66 Orders for occupational discipline
(1) This section applies if the tribunal may make an order for occupational discipline in relation to the subject person.
Note Section 65 sets out when the tribunal may make an order.
(2) The tribunal may make 1 or more of the following orders for occupational discipline in relation to the subject person:
(a) reprimand the person;
(b) require the person to give a written undertaking;
(c) require the person to complete a stated course of training to the satisfaction of the regulatory body or another stated person;
(d) give the person a direction;
Note For directions that may be given, see s 67.
(e) cancel or suspend the person’s licence or registration;
(f) disqualify the person from applying for a licence, or registration, of a stated kind for a stated period or until a stated thing happens;
(g) if a regulatory body may put conditions on the person’s licence or registration under an authorising law—direct the regulatory body to—
(i) put a condition on the person’s licence or registration; or
(ii) remove or amend a condition put on the person’s licence or registration;
(h) require the person to pay to the Territory or someone else a stated amount (not more than any amount prescribed by regulation);
(i) if the person gained financial advantage from the action that is the ground for occupational discipline—require the person to pay to the Territory an amount assessed as the amount of financial advantage gained by the person.
(3) If the ACAT cancels a person’s licence or registration, the ACAT may disqualify the person from applying for a licence or registration for a stated period or indefinitely.
(4) This section does not limit the orders the tribunal may make.
(5) In this section:
regulatory body means the entity responsible for issuing licences of the kind held by the subject person or for registering people in the occupation or profession in which the subject person is registered.
42. The ‘subject person’ is the person that is the subject of a disciplinary proceeding.
43. There are a list of orders in section 66(2) that may be made ‘in relation to the subject person’, most of which require that subject person to do certain things. However, section 66(4) specifically provides that section 66 does not limit the orders the tribunal may make.
44. All of the orders specifically set out in subsection 66(2) are orders directed at the subject person and there is no specific power in section 66 that enables an order to be made requiring somebody other than the subject of the disciplinary proceedings to do anything.
45. The question thus arises: is section 66(4) to be interpreted as a grant of power to make other orders including orders against persons other than the subject person? Or is it a power merely allowing further orders to be made against the subject person? Or is it not a power, but simply an acknowledgement that separate powers for occupational discipline may exist in other enabling legislation?
46. For example, under the Health Practitioner Regulation National Law Act 2009 (ACT) there is a list of other orders that may be made, so perhaps subsection 66(4) does no more than acknowledge that there are other powers given to the tribunal in other legislation.
47. Certainly there are no additional powers for the ACAT in occupational discipline matters against agents that I could find in the Agents Act, which would give section 66(4) a role and as I have noted, the powers provided in subsection 2 of section 66 are directed only at orders that can be made ‘in relation to the subject person’.
48. I think that this legal issue is critical to this matter.
49. Nonetheless, Order 3 is clearly, on its face, directed at the licensed director. Although the respondent says final orders may only be made against parties, no application to set aside that order or to appeal from it – on the basis that it is beyond power – has been made.
50. Order 3 must be assumed to be within power until it is challenged and so there is an argument that maybe it might be set aside, but until it’s set aside, it seems to me our legal system cannot operate if people are free to say, notwithstanding that I am named in this order, I reckon I do not have to comply with it and so I will not.
51. Additionally, Ms Katavic for the applicant submitted that an analogy could be drawn from the laws of contempt where an undertaking given by a company, if breached by a director, is taken to be a contempt by the director, in certain circumstances.
52. And this analogy may certainly apply if Order 3 is taken by the tribunal to in fact be an order directed at Murlton Pty Ltd, which the director, Mr Bowditch, consented to. That analogy might apply, but that depends on that order being interpreted as being an order directed at Murlton Pty Ltd. Currently, on its wording, it is directed at Mr Bowditch.
Conclusion
53. So it seems to me there are a number of arguments to be looked at in the submission raised by the respondent under that simple sentence: ‘Final orders can only be made against parties’.
54. Actually, an order can be made against a non-party if the power to do so is there. Is the power to do so there in this case? That is a tricky question and, in any event, even if this was an order against Murlton Pty Ltd, is it an order which Mr Bowditch is required to comply with because he is the licensed director who effectively undertook or consented to do that?
55. I am not satisfied, on the basis of the arguments that I have heard, that the respondent is clearly not contravening Order 3 on the basis of it being a final order against a non-party, or alternatively simply being outside the power provided by section 66 of the ACAT Act.
56. That is not to say that the proceedings against him will ultimately be successful. The test for me is whether it is apparent that these proceedings must fail. On the submissions I have heard and the argument I have heard, I am not satisfied that the proceedings must fail, and this is particularly because an order, once made, should be treated as valid and able to be enforced, unless and until it is set aside.
57. So those are my reasons for reaching the conclusion in the end that, although there are very good arguments that exist to be run, the outcome of these proceedings is by no means certain and in the end, that, under the traditional approach to summary dismissal, is the test. For the same reasons, the strikeout application would also fail if brought on the ‘frivolous and vexatious’ or ‘without substance’ basis under section 32 of the ACAT Act.
58. There are credible legal issues in dispute. It is not readily apparent that they must fail and so that application to strikeout the disciplinary application must be dismissed.
59. This outcome on the strikeout application does not stop the respondent from running those arguments at the hearing more fully, and you may get an outcome one way or another at the hearing if that occurs.
………………………………..
Presidential Member MT Daniel
HEARING DETAILS
FILE NUMBER:
OR 18/2019
PARTIES, APPLICANT:
Commissioner for Fair Trading
PARTIES, RESPONDENT:
David Bowditch
COUNSEL APPEARING, APPLICANT
Ms Katavic
COUNSEL APPEARING, RESPONDENT
Mr Masters
SOLICITORS FOR APPLICANT
O’Connor Harris
SOLICITORS FOR RESPONDENT
ACT Government Solicitor
TRIBUNAL MEMBERS:
Presidential Member MT Daniel
DATES OF HEARING:
26 July 2019
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