Ezy Cash Pawn Brokers Pty Limited v Director General, Department of Fair Trading

[2001] NSWADT 70

CITATION:	Ezy Cash Pawn Brokers Pty Limited -v- Director General, Department of Fair Trading [2001] NSWADT 70
DIVISION:	General Division
PARTIES:	APPLICANT Ezy Cash Pawn Brokers Pty Limited RESPONDENT Director General, Department of Fair Trading
FILE NUMBER:	013037
HEARING DATES:	19/04/2001
SUBMISSIONS CLOSED:	04/19/2001
DATE OF DECISION:	05/07/2001
BEFORE:	Hennessy N (Deputy President)
APPLICATION:	Pawnbrokers & Second-Hand Dealers Act - second-hand dealers licence - impose a condition on licence - Second-Hand Dealers licence - impose a condition on licence
MATTER FOR DECISION:	Principal matter
LEGISLATION CITED:	Human Rights and Equal Opportunity Commission Act 1986 Administrative Decisions Tribunal Act 1997 Pawnbrokers and Second-hand Dealers Act 1996
CASES CITED:	Khamis v Commissioner of Police, New South Wales Police Services [2001] NSWADT (13 February 2001) Alexander & Hassan Pty Ltd v Director General, Department of Fair Trading [2000] NSWADT 181 (8 December 2000) O’Sullivan v Farrer (1989) 168 CLR 210 Water Conservation and Irrigation Commission (N.S.W.) v.Browning (1947) 74 CLR 492 Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24 Reg. v. Australian Broadcasting Tribunal; Ex parte 2HD Pty Ltd (1979) 144 CLR 45 Swan Hill Corporation v. Bradbury (1937) 56 CLR 746
REPRESENTATION:	APPLICANT A Carter, solicitor RESPONDENT A Wilson, solicitor
ORDERS:	1. The decision of the Director General to renew Ezy Cash’s pawnbrokers and second-hand dealers licence subject to a condition that: ; Philip (AKA Phillip) Brian Taylor is to have no involvement with the operation of the business to which this licence relates; is affirmed.

Introduction

1 Ezy Cash Pawn Brokers Pty Ltd (Ezy Cash) applied to the Tribunal for a review of a decision by the Director General, Department of Fair Trading (the Director General). The decision was to renew Ezy Cash’s pawnbrokers and second-hand dealers licence subject to a condition. The condition was that:

Philip (AKA Phillip) Brian Taylor is to have no involvement with the operation of the business to which this licence relates

2 The reason the Director General imposed the condition was that Mr Taylor, who was the person in charge of the Mayfield branch of Ezy Cash, had been convicted of dishonesty offences. Those offences were obtaining financial advantage by deception in 1993 and steal property as clerk/servant in 2000.

Jurisdiction

3 Under s 39 of the Pawnbrokers and Second Hand Dealers Act 1996 (the Act), the Tribunal has power to review certain decisions of the Director-General. Section 39(2) states that:

A licensee whose licence has been revoked or suspended by the Director-General, or on whose licence a condition has been imposed (whether on grant or renewal of the licence or otherwise) may apply to the Administrative Decisions Tribunal for a review of the revocation, suspension or imposition.

Relevant legislation

4 Under the Act anyone carrying on the business of a pawnbroker or second hand dealer must be licensed. In this case a condition was imposed on that licence pursuant to s 11(1) of the Act which states that:

(1) A licence is subject to any conditions that the Director-General sees fit, in the public interest, to attach to it on grant or renewal or by order under section 36.

Issues and Conclusion

5 The issue in this case is whether the Director General made the correct and preferable decision in imposing the condition on Ezy Cash’s licence. (See s 63 Administrative Decisions Tribunal Act 1997) The particular question is whether is it was in the public interest for the condition to be imposed.

Evidence

6 The documentary evidence is contained in Exhibits A to E. Some of the documents were tendered more than once. Oral evidence was given by Mr Smith, the sole director of Ezy Cash, and Mr Taylor.

7 On 16 June 1993, Mr Taylor was convicted in the Local Court of 13 counts of “dishonestly obtain financial advantage by deception”. The offences involved failing to give his employer all the money he received from selling car alarms. He pleaded guilty to the charges and was sentenced to periodic detention for 6 months. The Court ordered Mr Taylor to repay the sum of $4,268.00.

8 On 20 March 2000, Mr Taylor was convicted in the Local Court of 355 counts of steal property as clerk/servant. These offences took place when Mr Taylor was employed as a store manager in the pawn broking industry during the period from 1996 to 1998. He pleaded guilty to stealing $91,893.00 from his employer. The Court sentenced him to home detention for 12 months commencing on 20 March 2000. The Court ordered Mr Taylor to repay the money to his employer.

9 Mr Taylor said that when he committed these offences he and his wife were having marital problems and they both turned to alcohol and gambling. He said that because he had a family to support and seemed to have no control over his gambling, he resorted to stealing.

10 Mr Taylor began working for Philjojo Pty Ltd, (a company which has a management agreement with Ezy Cash) in August 1999. The parties agreed, and I find, that the fact that Mr Taylor was not a direct employee of Ezy Cash does not prevent the Director General from imposing a condition under s 11 of the Act. Mr Taylor is not a director or shareholder of Ezy Cash, nor is he related to any person who is a director or shareholder.

11 When he applied for the job, Mr Taylor did not tell Mr Smith, the director of Ezy Cash, that he had a criminal record. When he was arrested for the offences committed from 1996 to 1998, Mr Taylor told Mr Smith about his conviction and offered to resign. Mr Smith decided to continue to employ Mr Taylor despite the previous conviction and charges for further offences.

12 Mr Smith gave evidence that he trusts Mr Taylor and believes he will not re-offend. He bases this opinion on conversations he has had with Mr Taylor and the fact that Mr Taylor knows that if he is convicted of any further offences of a similar nature he is likely to be given a custodial sentence. Mr Smith also said that he has lent money to Mr Taylor to pay for his legal fees and does not believe that Mr Taylor would take advantage of his good will by stealing from him.

13 Mr Andrew Bright was counsel for Mr Taylor in the second round of criminal proceedings. He wrote to Wood Roberts, solicitors for Mr Taylor, on 6 April 2000 reporting on the outcome of those proceedings. He said that in sentencing Mr Taylor the Court had taken into account several factors including “the fact that he was in full-time employment with an employer who was aware of his offences and personal circumstances but who nevertheless was prepared to stand by him.”

14 Mr Smith has set up computer systems and cash handling systems that he believes would make it extremely difficult for Mr Taylor to re-offend without being easily and quickly detected. Mr Smith’s step son also works in the shop and “keeps and eye” on Mr Taylor.

15 Ezy Cash has had a Pawbrokers and Second Hand Dealers licence since September 1999. Since that time, despite several inspections by officers from the Department of Fair Trading, no defaults have been disclosed.

16 A pre-sentence report in relation to Mr Taylor was prepared by a Probation Officer from the Department of Corrective Services on 4 February 2000. That report states, in part, that:

. . . while being described as outwardly confident and generous, the offender is also said to have had difficulty at times dealing with business and personal issues, when he apparently acts without giving thought to the consequences. It seems this may have been the case in his past offending, and could have contributed to the present offences, and in turn to his gambling and use of alcohol.

For the moment however, Mr Taylor appears to realise the depth and long term consequences of this behaviour, and says he is prepared to seek professional help to deal with these problems.

17 Mr Taylor concedes that he will always have a problem with gambling but since February 2000, he has been attending the Newcastle City Mission’s Gambling Recovery Project. He also goes to weekly meetings of Newcastle West Gambler’s Anonymous.

18 Mr Taylor realises that it is likely that he would be sentenced to a term of imprisonment if he is convicted of further dishonesty offences. Mr Taylor says that he has “turned his life around” by seeking help for his gambling addiction and that alcohol is not a significant problem.

19 If the condition is not set aside, Mr Taylor will lose his job with Ezy Cash. Mr Taylor is currently working in a video shop but that employment is temporary. He doubts that he will be able to obtain secure long term employment given his convictions.

Respondent's submissions

20 Mr Wilson, for the Director General, said that the decision to place the condition on Ezy Cash’s licence was made on the basis of Mr Taylor’s criminal record. There were two groups of dishonesty offences, 13 counts of “dishonestly obtain financial advantage by deception” in 1993 and 355 counts of stealing from his employer in 2000. The second group of offences was committed fairly recently, that is between 1996 and 1998.

21 Mr Wilson referred the Tribunal to the decision of Khamis v Commissioner of Police, New South Wales Police Services [2001] NSWADT (13 February 2001) at [80] in relation to the meaning of “public interest”.

22 Mr Wilson conceded that there was a public interest in Mr Taylor’s rehabilitation, but that this was not relevant in the context of the Act. Mr Wilson referred to the Second Reading speech (Hansard 24 April 1996) where the then Minister for Fair Trading, Mrs Lo Po’, said at p 439, that:
The Government is intent on enhancing the capacity of the Police Service to target thieves and those who trade with them and of the Department of Fair Trading to remove dishonest traders from the market place.

23 In any event, Mr Wilson said that Mr Taylor could get another job outside the pawnbroking industry.

24 Mr Wilson attempted to distinguish the decision in Alexander & Hassan Pty Ltd v Director General, Department of Fair Trading [2000] NSWADT 181 (8 December 2000), from the present case. In Alexander & Hassan, the Tribunal set aside the Director General’s decision to place a similar condition on a licence. The condition was imposed on the basis of a single offence, at the lower end of the scale of stealing offences, committed over 8 years ago. In Mr Wilson’s submission, the convictions in this case were much more recent and serious.

Applicant's submissions

25 Mr Carter, representing Mr Taylor, submitted that the term “public interest” in s 11 of the Act should be interpreted broadly. He noted that in Alexander and Hassan the Tribunal had confined its consideration to the matters set out in s 8(4) of the Act. Those matters relate to the review of a decision to refuse to grant a licence to a person or corporation because of a conviction for dishonesty in the previous ten years. The Triubnal may determine that the fact that the person has committed the offence should be ignored on one or more of the following grounds:
(a) the triviality of the acts or omissions giving rise to the offence,
(b) the time that has passed since the offence was committed,
(c) the subsequent good behaviour of the offender,
(d) any other ground prescribed by the regulations.

26 Mr Carter submitted that because this case does not relate to the disqualification of a potential licensee, broader public interest considerations should be considered, namely:
• the burden on the welfare system if Mr Taylor is unemployed;
• Mr Taylor’s inability to pay restitution to his former employer if Mr Taylor is unemployed;
• the effect on Mr Taylor’s rehabilitation if he cannot work for Ezy Cash; and
• discrimination issues.

27 In relation to the “discrimination” issues, Mr Carter submitted that to allow the imposition of the condition may constitute unlawful discrimination under the Human Rights and Equal Opportunity Commission Act 1986 . Clause 4 of the Human Rights and Equal Opportunity Regulations 1989 provide that the definition of discrimination includes
. . . any distinction, exclusion or preference made:
(a) on the ground of:
(iii) criminal record.“


28 Alternatively, Mr Carter submitted that the Tribunal should have regard to the fact that the Commonwealth Parliament considers that it is in the public interest that employers (and others) should not discriminate on the grounds of criminal record.

Reasons and Decision

29 The condition was imposed pursuant to s 11(1) of the Act because the administrator saw fit to impose it "in the public interest". Public interest is not defined in the Act and there are no factors listed in the Act to guide the exercise of the administrator’s discretion. In O’Sullivan v Farrer (1989) 168 CLR 210 Mason CJ, Brennan, Dawson, and Gaudron JJ, said at para 13
. . . the expression "in the public interest", when used in a statute, classically imports a discretionary value judgment to be made by reference to undefined factual matters, confined only "in so far as the subject matter and the scope and purpose of the statutory enactments may enable ... given reasons to be (pronounced) definitely extraneous to any objects the legislature could have had in view": Water Conservation and Irrigation Commission (N.S.W.) v.Browning (1947) 74 CLR 492, per Dixon J. at p 505.

30 Dixon J’s comments, in full, in Water Conservation and Irrigation Commission (N.S.W.) v.Browning (1947) 74 CLR 492, are as follows:
But there is no positive indication of the considerations upon which it is intended that the grant or refusal of consent shall depend. The discretion is, therefore, unconfined except in so far as the subject matter and the scope and purpose of the statutory enactments may enable the Court to pronounce given reasons to be definitely extraneous to any objects the legislature could have had in view.

31 In Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24 at [15] Mason J interpreted Dixon J’s words in Water Conservation and Irrigation Commission (NSW) v Browning, as well as similar pronouncements in other cases, as follows:
In the context of judicial review on the ground of taking into account irrelevant considerations, this Court has held that, where a statute confers a discretion which in its terms is unconfined, the factors that may be taken into account in the exercise of the discretion are similarly unconfined, except in so far as there may be found in the subject matter, scope and purpose of the statute some implied limitation on the factors to which the decision-maker may legitimately have regard (see Reg. v. Australian Broadcasting Tribunal; Ex parte 2HD Pty Ltd (1979) 144 CLR 45, at pp 49-50, adopting the earlier formulations of Dixon J. in Swan Hill Corporation v. Bradbury (1937) 56 CLR 746, at pp 757-758, and Water Conservation and Irrigation Commission (N.S.W.) v. Browning (1947) 74 CLR 492, at p 505).

32 These decisions make it clear that the administrator may take into account any relevant factor in determining whether it is in the public interest to impose a condition on the applicant’s licence. However, there may be an implied limitation on these factors, evident from the subject matter, scope and purpose of the legislation.

33 One public interest considerations which is relevant is the public interest is preventing dishonest people from entering or continuing to trade or work in the pawnbroking and second hand dealing industry. That purpose is plain from the mandatory provisions contained in s 8(1)(d) and s 8(2)(c) of the Act in relation to licensees and s 34 in relation to employees. In determining whether there is a risk that Mr Taylor would behave dishonestly if he continues in his current employment, several factors are relevant including:

• the nature, seriousness and circumstances of the offences,
• time since the offences were committed; and
• the subsequent good behaviour of the offender. (Compare s 8(4) of the Act)

34 The more difficult question is whether the other public interest considerations outlined by Mr Carter, for the applicant, are relevant considerations. These include:
• burden on the welfare system if Mr Taylor is unemployed
• inability of Mr Taylor to pay restitution if unemployed;
• prejudice to Mr Taylor’s continued rehabilitation if unemployed; and
• discrimination issues.


35 In relation to the first three factors listed above, I have concluded that there is an implied limitation on consideration of these factors, evident from the subject matter, scope and purpose of the legislation. While it is in the public interest for people like Mr Taylor to be employed, to compensate people from whom they have stolen money and to rehabilitate themselves, these are not matters with which the Act is concerned. The Act is concerned with ensuring, as far as possible, that the business of pawnbroking and second hand dealing is conducted honestly and transparently. Even if I am wrong in coming to this conclusion, Mr Taylor was working in another position at the time of the hearing. While I accept that this position did not pay as well as his job with Ezy Cash, and that it was temporary, I am satisfied, contrary to Mr Taylor’s evidence, that it is likely that he would be able to obtain other permanent employment outside the pawnbroking industry. There is nothing other than his convictions which would prevent him from doing so. This finding negates the relevance of the first three public interest considerations listed in paragraph 34 above.

36 In relation to the public interest that Mr Taylor is not discriminated against because of his criminal record, I do not see this as a danger. The legislation is drafted so as to give the administrator discretion to determine whether it is in the public interest for the condition to be placed on the licence. If Mr Taylor’s conviction for dishonesty offences was irrelevant to his work in the pawnbroking industry, it would be discriminatory, in the non-legal sense of that word, to take them into account. Clearly, those convictions are relevant considerations to be taken into account in the circumstances of this case.

37 Mr Taylor concedes that the offences he committed were not trivial. In relation to the second conviction, there were some 355 individual offences involving over $91,000. These offences were committed when Mr Taylor was working for a licenced pawnbroker and second hand dealer. They were offences against his employer, not against members of the public. The last of the offences was committed in mid 1998. Mr Taylor was sentenced to 12 months periodic detention which he completed a month ago, in March 2001. Mr Taylor has made significant efforts to rehabilitate himself. He has not re-offended. Since February 2000, he has been attending the Newcastle City Mission’s Gambling Recovery Project. He also goes to weekly meetings of Newcastle West Gambler’s Anonymous. He has the support and confidence of his employer.

38 On the basis of all the evidence, I consider that Mr Taylor will probably not re-offend, but there is nevertheless a tangible risk that he will do so. He has been convicted of dishonesty offences against his employer twice, once in 1993 and again in 2000. He did not learn from his first episode and may not learn from the second. While his gambling addiction is presently under control, there is no guarantee that it will remain so in the long term. Family tensions may surface again, leading Mr Taylor into a situation where he is tempted to commit dishonesty offences. A relatively short period of time has passed since Mr Taylor was convicted of these offences. Further periods of good behaviour are necessary before any lingering doubts about his suitability to work in the industry can be put to rest. In these circumstances, it is not in the public interest for Mr Taylor to continue working in an industry which is making concerted efforts to improve its credibility and transparency.

Orders

39 The decision of the Director General to renew Ezy Cash’s pawnbrokers and second-hand dealers licence subject to a condition that:
Philip (AKA Phillip) Brian Taylor is to have no involvement with the operation of the business to which this licence relates


is affirmed.