Courto v The Tasmanian Gaming Commission

[2013] TASSC 80

[2013] TASSC 80

COURT:  SUPREME COURT OF TASMANIA

CITATION:              Courto v The Tasmanian Gaming Commission [2013] TASSC 80

PARTIES:  COURTO, Michael
  v
  TASMANIAN GAMING COMMISSION, THE

FILE NO:  404/2013
DELIVERED ON:  20 December 2013
DELIVERED AT:  Hobart
HEARING DATE:  14 October 2013
JUDGMENT OF:  Tennent J

CATCHWORDS:

Appeal and New Trial – Appeal - General principles – Right of appeal – Nature of right – Appeals by way of re-hearing – When hearing involves hearing de novo – Appeal from decision of Tasmanian Gaming Commission to take disciplinary action against the holder of a special employee licence.

Bishop v Tasmanian Gaming Commission [1999] TASSC 9, applied.
Gaming Control Act 1993 (Tas), ss112S, 112T.
Aust Dig Appeal and New Trial [8]

REPRESENTATION:

Counsel:
             Appellant:  J O'Shannessey
             Respondent:  A McKee
Solicitors:
             Appellant:  Murdoch Clarke
             Respondent:  Director of Public Prosecutions

Judgment Number:  [2013] TASSC 80
Number of paragraphs:  37

Serial No 80/2013
File No 404/2013

MICHAEL COURTO v THE TASMANIAN GAMING COMMISSION

REASONS FOR JUDGMENT  TENNENT J

20 December 2013

1. On 6 May 2013, the Tasmanian Gaming Commission ("the Commission") made a decision pursuant to the Gaming Control Act 1993 ("the Act"), s112T(4), to cancel Special Employee licence number 12030 held by Michael Courto ("the appellant").

1. The appellant now appeals that decision and seeks an order setting it aside. The grounds of the appeal are that the action of cancelling the appellant's licence was manifestly excessive, and that, in exercising its discretion, the Commission gave insufficient weight to factors presented by the appellant.

1. The decision of the Commission arose out of the following circumstances. In April 2012 the appellant was the manager of the Queenstown Railway Hotel. That hotel had a Keno facility. The appellant held a Special Employee Licence, a licence issued under the Act, required to enable him to operate that Keno facility. He had held that licence since 5 June 2002. Since 19 July 2002, that licence had also been endorsed with senior writer competency.

1. It was a condition of the Special Employee licence that the licensee must not play Keno during any work shift. It was a requirement under the Act that such a licensee must not participate in gaming while on duty. There is no question that the appellant was aware of these requirements.

1. On 10 separate occasions on 7 April 2012, while he was on duty as manager of the hotel, the appellant purchased Keno tickets. He accepted that he had, in doing so, breached not only a condition of his Special Employee licence but also the provisions of the Act. Two of the tickets purchased by the appellant won prizes. Those prizes totalled $423,269.50. At some time between 7 and 10 April 2012, a member of the public made a complaint about the appellant's activities to officers of Network Gaming, the entity which oversees Keno operations in Tasmania. Those officers contacted the compliance branch of the Commission and an investigation commenced.

1. The officers of the compliance branch obtained evidence to the effect the appellant had not only participated in gaming while on duty on 7 April 2012, but also played Keno during his shift that day. They recommended to the Commission that it make a preliminary determination to take disciplinary action against the appellant and cancel his Special Employee licence. The Commission accepted the recommendation, and invited the appellant to make submissions as to why the intended disciplinary action should not be taken. The appellant's solicitors made submissions. On 9 April 2013, after considering those submissions, the Commission determined to cancel the appellant's Special Employee licence.

1. On 6 May 2013, the appellant filed an appeal with this Court against that decision. He also filed an interlocutory application by which he sought an order restraining the Commission from immediately cancelling the relevant licence. That matter came on for hearing the day it was filed. As a result of an indication to the effect that there may be no power under the Act to grant the relief sought, the appellant filed an originating application seeking judicial review of the decision of the Commission. The Judicial Review Act 2001 allowed for the type of interlocutory relief the appellant was seeking. An order was made in those proceedings suspending the operation of the Commission's decision until the appeal and/ or the judicial review applications were dealt with.

1. The Act, DIV6, deals with disciplinary action which may be taken against persons who hold licences under the Act. Section 112S sets out the grounds which must exist before disciplinary action may be taken in respect of prescribed licences. There is no dispute the appellant's Special Employee licence was a prescribed licence. Ground 1(d) is that "the prescribed licence holder has contravened a condition to which the prescribed licence is subject;". There is no dispute the appellant contravened a condition of his licence.

1. Section 112T defines disciplinary action to mean:

-     the cancelation of a prescribed licence;

-     the suspension of a prescribed licence;

-     the cancellation of a gaming endorsement;

-     the suspension of a gaming endorsement;

-     the amendment of the conditions to which a prescribed licence is subject;

-     the imposition of a fine;

-     the issue of a letter of censure.

1. Pursuant to the Act, s112T(3), the Commission is required to notify a licence holder that it is considering disciplinary action, and give the licence holder an opportunity to make submissions. That occurred in this case. Following the submissions, the Commission determined, pursuant to s112T(4), to take disciplinary action in the form of cancellation of the appellant's licence.

1. An appeal under the Act is to be by way of a hearing de novo; see Bishop v Tasmanian Gaming Commission [1999] TASSC 9 at [11]. Crawford J (as he then was) said at [9]:

"It will be a matter for me to decide, upon the evidence the parties put before me, whether there are grounds for disciplinary action, as that expression is used in the Gaming Control Act 1993, s61(1), and if so whether, in the exercise of my discretion, disciplinary action of some form should be taken against the appellant. The onus will be on the respondent to justify its decision to cancel the appellant's licence. However my choice will not be merely to affirm or set aside the respondent's decision. In the exercise of my discretion I may, if I find that grounds for disciplinary action have been established, decide instead to censure the appellant or to vary or suspend his licence rather than cancel."

1. The respondent to this appeal submitted that there can be no argument that the appellant breached a condition of his licence and that therefore there is a ground for disciplinary action. There is no dispute about that on this appeal. Counsel for the respondent however also submitted that the Court, in exercising its discretion imposed by reference to the Act, s112T(4), should determine that disciplinary action is appropriate, and that the form of that disciplinary action should be the cancellation of the Special Employee licence held by the appellant.

1. The Act is silent as to the matters to be taken into account when exercising the discretion. Counsel for both parties addressed a number of different issues, and there was no dispute that each of the matters referred to was relevant to the exercise of the discretion.

Submissions of counsel for the appellant

1. The appellant is aged 62. He is married with six children and nine grandchildren. He left school at the age of 15 years to work in the mines on the West coast. He has worked consistently in various positions since, and achieved in all. In 2001, he was appointed the licensee and employed as manager of the hotel. He still holds those positions. The person who is in effect the appellant's employer and who has known him for many years, Mr Robert Cox, said in an affidavit:

"I consider the Appellant to be a highly ethical person. He is honest, forthright and passionate. I have observed that he is held in high regard by the Aboriginal community of Tasmania and has served with distinction in the various commercial ventures to which he has been appointed."

Mr Cox also indicated that the appellant would lose his position at the hotel if the penalty imposed by the Commission were to stand, indeed if any penalty beyond a three month suspension was imposed.

1. Counsel for the appellant also made a number of submissions relating to the appellant's contribution to the community. These were as follows:

"10In addition to his contributions to both the West Coast and indigenous communities through his formal employment with WCAC, the Appellant has been significantly involved in community organisations in Tasmania throughout his life.

11Whilst employed at the West Coast Council, the Appellant was elected as Aboriginal Torres Strait Islander ('ATSIC') Regional Councillor for the Tasmanian Region Aboriginal Council ('TRAC') and was further appointed as Deputy Chairperson on multiple occasions through the 1990's.

(JP p 28 lines 1-4).

12During his involvement with TRAC, ATSIC was successful in working with local, state, and federal governments in introducing new policies in the areas of health, employment, accident and police relations so as to attempt the redress the dispossession and disadvantage of indigenous Australians in Tasmania. (JP p 28 lines 5-8).

13In 1998, the Appellant was appointed as community representative to the West Coast Advisory to the West Coast Advisory Committee by the Tasmanian Government. (JP p 28 lines 13 – 14).

14In 1999, the Appellant was elected as Chairperson of the Tasmanian Aboriginal Investments Trust (TAIT) and still acts in this position.  TAIT is a private trust and over course of the last 13 years under the leadership of the Appellant has provided economic advice to its members which presently consist of 8 indigenous Australian organisations spread across Tasmania.

(JP p 28 lines 9 – 12)

15In between 1999 and 2000, the Appellant was a member of the Committee at the Lyell District Ex-Services Club. (JP p 28 lines 15 – 16).

16The Appellant has served as Chairman of the Workforce Aboriginal Corporation ('WAC') which was established in 1999.  WAC was established to operate the Community Development and Employment Program in Tasmania.  During the Appellant's involvement, WAC has provided assistance to members of the local indigenous community through organising work placement and training. (JP p 28 lines 17 – 21).

17The Appellant has also been involved in sponsoring community groups such as the Men's shed, the Queenstown Anglers Club and the Queenstown and District Basketball Association. (JP p 28 lines 21 – 23).

18The Appellant possesses a long and rich history of community service which has aided in assisted members, in particular indigenous members of Tasmania's West Coast.  His contribution reflects not only his good character but also his focus on advancing and resolving the issues of members of his community.

19The contributions made by the Appellant to the Tasmanian community may also be reflected in the comments of Mr Robert Cox who noted that the Appellant 'has made significant contributions to the Tasmanian indigenous community.  In particular, I have observed his efforts in securing employment and training outcomes in real world situations for Aboriginal people and the broader community.  The Appellant's commitment to the wider community can also be demonstrated in his sponsorship of bodies such as: the Queenstown Rifle Club, Queenstown Anglers Club, the Men's Shed, and the Queenstown and District Basketball Association.' (JP p 34 lines 15 – 21).

20The Appellant's contribution to community is also reflected in the comments of Mr Mark Setori who noted that the 'Appellant has been involved in the West Coast community, and in particular has run fundraising events for various individuals who were in need of assistance.  I recall that the Appellant recently co-ordinated a fundraiser for a local person who was in need of an electric wheelchair. I am also aware that the Appellant makes contributions to local sporting bodies and the yearly Australia Day picnics which are run at Strahan and Lake Burbury.' (JP p 36 lines 7 – 14).

21The respect in which the Appellant is held within the West Coast Community may also be reflected by the comments of Julianne Jones who noted that the Appellant 'has a strong bond to many West Coast people and is respected in most circles.' (JP p 38 lines 5 – 6)."

1. The appellant has not been the subject of any finding adverse to his licence before.

1. As to the issue of personal deterrence, the appellant has been distressed by the process which followed the complaint against him. It has involved an interview with investigative officials, and the knowledge for over a year that his licence may be cancelled and his job lost. He has expressed regret for his actions, he is ashamed of his conduct and the embarrassment he has caused family and friends. He has incurred significant expense in engaging legal representation.

1. As to general deterrence, counsel submitted that in effect the penalty imposed in this case was the most severe available. He submitted that it is relevant to consider that the Commission has, on ten occasions where it was considering disciplinary action arising from a licensee playing Keno while on duty, the penalty has not involved cancellation of a licence.

1. Counsel also submitted that a Commission policy relating to employees of Betfair Pty Ltd who hold special licences and gamble while on duty was reflective of a policy generally about the type of disciplinary action which would constitute general deterrence. Very generally, that policy provides for a system of warning letters for a first offence, a letter of censure for the second (following a notice to show cause why disciplinary action should not be taken), and only on the third breach would an offender be asked to show cause why disciplinary action should not be taken. Counsel submitted that, in this case, a letter of censure would act as an appropriate deterrent.

1. Counsel for the appellant also raised the issue of hardship to the appellant. The appellant would lose his position if his licence were cancelled, and, given his age, he would have difficulty finding alternative employment.

1. Other factors raised were:

-     that the appellant's conduct occurred on one day and there was no evidence it had been repeated;

-     the quantum of the appellant's winnings was irrelevant;

-     there was no element of dishonesty in that the appellant's actions did not involve any manipulation of the Keno system;

-     the appellant had co-operated with the respondent in the preparation and conduct of this appeal.

Respondent's submissions

1. The respondent accepted that, in general terms, it was impossible for a Keno writer to manipulate the outcome of a game of Keno. Network Gaming jealously guarded its reputation as conductor of a gaming operation that cannot be manipulated. One of the primary purposes of the condition preventing Keno writers from gaming while on duty was to assure the public that a Keno writer had no ability to manipulate the system, and had no vested interest in the outcome of a game. That public perception would be undermined if licence holders were seen to be gaming.

1. The complaint to officials came from a member of the public. While the amount of any winnings the appellant may have received was in itself not relevant to penalty, it was relevant when considering this issue of public perception. A member of the public would be rightly concerned about the integrity of the system were they to see a large amount of winnings go to a licensee.

1. As to personal deterrence, the appellant was an experienced Keno writer who well knew the conditions of his licence. There had been no explanation for what appears to have been a conscious decision to gamble on ten separate occasions during the course of a particular day. While the appellant had indicated his behaviour would not be repeated, the lack of explanation and his actions would give the Court no comfort as to that.

1. As to general deterrence, counsel submitted that any penalty must adequately protect the need to reassure the public as to the integrity of the system.

1. As to hardship, the only hardship identified was the difficulty the appellant may have finding alternative employment were he to lose his position. While it may be accepted that difficulty might exist, it must be balanced against his conduct, that is a deliberate decision to gamble several times in one day knowing that, if he was caught, he could face the cancellation of his licence.

1. Other matters raised by the respondent were:

-     the minimal co-operation by the appellant with investigating officials. He initially only made admissions to purchasing two tickets. He made no comment when specifically asked about the other eight;

-     the appellant's prior good character should have limited weight because, to obtain his licence in the first place, the appellant needed to be of good character and undergo a police check.

Discussion and conclusion

1. The appellant breached a condition of his Special Employee licence by playing Keno while on duty and breached the Act by gaming. The breaches took the form of the purchase of ten Keno tickets at intervals over the course of a day between 9.04am and 4.57pm. Two of the tickets earned him very significant winnings which was most likely the reason why a member of the public lodged a complaint. The appellant was a licence holder of many years' standing, and well knew the conditions he was obliged to adhere to and the possible penalties if he breached those conditions. There can be little doubt that a member of the public who saw the licensee buying Keno tickets and winning a large amount of money would have had legitimate concerns about the integrity of the system. That is a system, the integrity of which was important to those who operate it. The existence of the conditions the appellant breached was part of a system designed to protect that integrity.

1. There has been no explanation at all as to why the appellant engaged in the conduct that he did.

1. There is no doubt the appellant has over many years had a very good work ethic, has given much back to the community and is well thought of by his employer. However that does not assist him greatly in the face of deliberate actions in breach of his licence. Rhetorically, one must ask, why have the conditions if they can be breached so deliberately and without explanation?

1. The summary of prior penalties imposed by the Commission in respect of licensees gambling while on duty indicates that of the 21 matters listed (omitting that of the appellant), ten involved the cancellation of a licence. Only two involved a letter of censure, the rest being divided between suspensions and fines. It is not possible to use that list as any definitive indication of what the most common penalties imposed by the Commission were because there was very little information contained in it as to the circumstances surrounding each matter. However, what it does indicate is that clearly the disciplinary action involving cancellation is not uncommon.

1. The appellant did not initially co-operate with investigating officers, and it may be inferred hoped not to be detected in relation to all his activities.

1. The facts of this matter lead to only one conclusion, and that is that it is appropriate for disciplinary action to be taken in respect of the appellant. The only real issue on this appeal is the nature of that disciplinary action. In essence what the appellant submits is that the disciplinary actions outlined in the Act, s112T(1), range from the most severe, that is cancellation, to the most lenient, that is a letter of censure, and that the facts of this matter do not support the imposition of the harshest action.

1. The submissions of counsel for the appellant to that effect do have merit. However, the submissions of the respondent persuade me that cancellation is the appropriate penalty. The factors which support that in this case are:

-     the number of acts constituting the breaches;

-     the apparent deliberate nature of them at regular intervals over a day against a background of the experience and knowledge of the appellant;

-     the limited initial co-operation with investigating officials;

-     the need to reassure the public as to the integrity of the Keno system;

-     the lack of any explanation as to why the appellant committed the breaches.

1. I am of the view that the cancellation of the appellant's Special Employee licence is in all the circumstances of this case the appropriate penalty to impose.

Outcome

1. What I am determining is the appeal against the decision of the Commission. The order that I make is that the appeal is dismissed.  Counsel have also invited me to make orders which would also finalize the judicial review proceedings in the event that the appeal was dismissed, and in particular the effect of the injunctive order made.

1. In the circumstances, there will be a further order in relation to proceedings 406 of 2013 to the following effect, namely that, in the event that, at the expiration of the time permitted for an appeal from this decision, there is no appeal filed, the interlocutory order made in the proceedings commenced by the appellant under the Judicial Review Act 2001 on 6 May 2013 is vacated, the substantive proceedings are dismissed and there is no order as to costs in those proceedings.