Golman and Australian Securities and Investments Commission

[2021] AATA 4176

Golman and Australian Securities and Investments Commission [2021] AATA 4176 (12 November 2021)

Division:TAXATION AND COMMERCIAL DIVISION

File Number:          2020/8478

Re:Serge Golman

APPLICANT

AndAustralian Securities and Investments Commission

RESPONDENT

DECISION

Tribunal:The Hon Justice D G Thomas, President
Deputy President Bernard J McCabe

Date:12 November 2021

Place:Brisbane

The Tribunal has jurisdiction to deal with the reviewable decision. The parties should confer on an appropriate timetable to progress the matter towards a final hearing.

............................[SGD]............................................

The Hon Justice D G Thomas, President

CATCHWORDS

PRACTICE AND PROCEDURE – Jurisdiction – whether Tribunal has jurisdiction to review decision – disqualification order made by the Australian Securities and Investments Commission (ASIC) pursuant to s 206F of the Corporations Act 2001 (Cth) – whether ASIC had power to make disqualification order – where mechanism for disqualification under s 206F previously enlivened but ASIC decided to not disqualify applicant – whether ASIC prevented from re-exercising power under 206F due to previous disqualification process – whether s 33 of the Acts Interpretation Act 1901 (Cth) applies such that power in s 206F can be re-exercised – Tribunal has jurisdiction to review decision.

LEGISLATION

Acts Interpretation Act 1901 (Cth): s 33
Administrative Appeals Tribunal Act 1975 (Cth): s 43
Corporations Act 2001 (Cth): ss 5C, 206A, 206F, 533

Migration Act 1958 (Cth): ss 501, 501A

CASES

Minister for Immigration and Border Protection v Makasa (2021) 95 ALJR 117
Minister for Immigration and Ethnic Affairs v Kurtovic (1990) 21 FCR 193
Minister for Immigration and Multicultural Affairs v Bhardwaj (2002) 209 CLR 597
Murdaca v Australian Securities and Investments Commission (2009) 178 FCR 119

Oreb v Australian Securities and Investments Commission (No 2) (2017) 247 FCR 323

REASONS FOR DECISION

The Hon Justice D G Thomas, President
Deputy President Bernard J McCabe

12 November 2021

INTRODUCTION

1. Part 2D.6 of the Corporations Act 2001 (Cth) sets out provisions under which a person may be disqualified from being involved in the management of a corporation. Section 206A makes it an offence for a person who is disqualified under one of those provisions to thereafter be involved in the management of a corporation while disqualified. Some of the provisions in Part 2D.6 provide for automatic disqualification upon the occurrence of particular events. Other disqualification powers can only be exercised by the Court. This case is concerned with the power of the Australian Securities and Investment Commission (ASIC) to disqualify an officer where that officer has a track record of involvement in companies that were wound up in insolvency. That disqualification power is found in s 206F.

2. An ASIC delegate decided in 2020 to disqualify the applicant in these proceedings under s 206F (2020 delegate). The applicant, Mr Serge Golman, has since questioned whether the 2020 delegate had the power to make that decision in circumstances where another ASIC delegate had already decided in 2018 not to disqualify him (2018 delegate). The 2018 disqualification process was premised on Mr Golman’s involvement in four companies that were wound up due to insolvency. The 2020 process was premised on Mr Golman’s involvement in three of the same companies.

3. Mr Golman sought review of the 2020 delegate’s decision to disqualify him. He has asked the Tribunal to make a preliminary determination as to whether the delegate had the power to make the reviewable decision given a different delegate had already conducted a process with a favourable outcome that was triggered by the insolvency of the same companies. Mr Golman says ASIC is effectively seeking a ‘second bite at the cherry’ following what he presumably sees as a favourable decision by the 2018 delegate.

4. The parties provided us with written submissions and participated in a preliminary hearing where agreed questions were presented for resolution. Mr Golman‘s central argument was that ASIC had already decided not to disqualify him in 2018 and it did not have power (or should be not be permitted) to commence another decision-making process under s 206F that relied on what he said were substantially the same ‘trigger’ events.

5. While the parties canvassed some difficult technical arguments, the outcome of the interlocutory application turns on the interpretation of s 206F of the Corporations Act and its interaction with s 33 of the Acts Interpretation Act 1901 (Cth)[1]. We are satisfied the combined effect of those provisions permitted the 2020 delegate to make the reviewable decision under s 206F notwithstanding the earlier decision-making process. We explain our reasons for that conclusion below. We will begin by setting out the text of s 206F(1). We will then set out the decision-making processes to date. Ordinarily, of course, the Tribunal is only interested in the decision-making process below in order to establish there is, in fact, a reviewable decision. It would not normally be appropriate to dwell on the reasons given by the decision-maker for their decision since we are reviewing the outcome, not the reasoning process. We are not interested in the decision-maker’s reasons per se, but – at least for the purposes of this interlocutory decision – we need to explore the process because it may be relevant to whether the process can be repeated.

   [1] As at 1 January 2005: s 5C of the Corporations Act.

6. Once we have done that, we will proceed to deal with the questions put to us by the parties in the order they were compiled. It will become obvious that we regard the answer to the third question to be dispositive of the ultimate question about our jurisdiction.

   THE DECISION UNDER S 206F OF THE CORPORATIONS ACT

7. It will be helpful to set out the text of s 206F(1) at the outset of our reasons. The subsection provides:

   206F    ASIC’s power of disqualification

   (1)       ASIC may disqualify a person from managing corporations for up to 5 years         if:

   (a)within 7 years immediately before ASIC gives a notice under paragraph (b)(i):

   (i)the person has been an officer of 2 or more corporations; and

   (ii)while the person was an officer, or within 12 months after the  person ceased to be an officer of those corporations, each of the corporations was wound up and a liquidator lodged a report under subsection 533(1) (including that subsection as applied by section 526‑35 of the Corporations (Aboriginal and Torres Strait Islander) Act 2006) about the corporation’s inability to pay its debts; and

   (b)       ASIC has given the person:

   (i)a notice in the prescribed form requiring them to demonstrate why they should not be disqualified; and

   (ii)an opportunity to be heard on the question; and

   (c)       ASIC is satisfied that the disqualification is justified.

   …

8. In these interlocutory reasons, we are concerned with the effect of subsection (1)(a) in particular. Mr Golman says ASIC did not (and could not, or should not) satisfy the jurisdictional requirements or preconditions set out in that subsection before purporting to issue the notice referred to in subsection (1)(b), and before purporting to exercise the discretion referred to in subsection (1)(c).

9. We will return to our analysis of the provisions in due course as we deal with the questions posed by the parties. Before doing that, we should set out the chronology of events that was agreed between the parties for the purposes of this interlocutory application.

   THE FIRST DECISION-MAKING PROCESS THAT CULMINATED IN THE 2018 DECISION

10. Mr Golman was an officer of a number of companies that were wound up in circumstances where the liquidator reported under s 533(1) of the Corporations Act that the companies may be unable to pay unsecured creditors more than 50 cents in the dollar. On 19 September 2017, ASIC issued a ‘show cause’ notice under s 206F(1)(b)(i) referring to four corporations in particular: Lidcombe Plastering Services Pty Ltd, Lidcombe Plastering Pty Ltd, Glenvale Developments Pty Ltd and Jamison’s Joinery Pty Ltd. A copy of that notice and statement of concerns is reproduced in the Tribunal Documents at T68 pp 1429-1437. The statement of concerns noted the following reports were received under s 533:

COMPANY

REPORT

1.    Lidcombe Plastering Services

· Section 533(1) report received 19 August 2016

· Section 533(2) report received 4 November 2016

2.    Lidcombe Plastering

· Section 533(1) report received 8 April 2015

3.    Glenvale Developments

· Section 533(1) report received 30 June 2016

4.    Jamison’s Joinery

· Section 533(1) report received 11 July 2012

· Section 533(2) report received 21 August 2012

1. Having initiated the process under s 206F, the 2018 delegate convened a hearing and took submissions from Mr Golman. At the conclusion of that process, the 2018 delegate decided not to exercise the discretion in s 206F(1)(c) to disqualify Mr Golman. The 2018 delegate’s written decision to that effect is set out in a letter dated 21 February 2018. The letter is reproduced in the Tribunal Documents at T70 p 1492.

   THE SECOND DECISION-MAKING PROCESS IN 2020 THAT CULMINATED IN THE REVIEWABLE DECISION

2. ASIC issued another ‘show cause’ notice to Mr Golman under s 206F(1)(b)(i) on 18 March 2020 (2020 notice). The 2020 notice and the attached statement of concerns (reproduced in the Tribunal Documents at T3-T5 pp 87-97) (2020 statement of concerns) referred to Mr Golman having been an officer of Lidcombe Plastering, Lidcombe Plastering Services and Glenvale Developments (ie, three of the four corporations referred to in the earlier process, but not Jamison’s Joinery) where the liquidator had lodged s 533 reports. The s 533 reports for Lidcombe Plastering and Glenvale Developments were the same reports (referred to in the table above) that were before the first delegate. The material in relation to Lidcombe Plastering Services was different. In addition to the report under s 533(2) dated 4 November 2016 that was before the first delegate, the 2020 notice and 2020 statement of concerns referred to a report under s 533(1) dated 5 October 2017 and a supplementary report under s 533(2) dated 16 May 2019. We note the s 533(1) report dated 5 October 2017 was received by ASIC before the first decision-making process was completed in 2018. It was not considered by the 2018 delegate, which was probably unfortunate. The 2020 statement of concerns from ASIC identified more serious concerns about Mr Golman’s behaviour with respect to Lidcombe Plastering Services; that extra detail was derived from material that was not before the previous delegate. Other than that, a brief comparison of the 2017 and 2020 statements of concern does not suggest any additional information was available in relation to the affairs of Lidcombe Plastering and Glenvale Developments.

3. The 2020 delegate held a hearing and reached a different conclusion from the 2018 delegate. The 2020 delegate decided to exercise the discretionary power to disqualify Mr Golman for four years. Mr Golman was informed of that decision in a letter dated 25 November 2020 which enclosed a statement of reasons: Tribunal Documents at T2, pp 58-83.

   THE PRESENT REVIEW AND THE QUESTIONS POSED

4. Mr Golman has asked the Tribunal to review the 2020 delegate’s decision. That brings us to the questions that have been posed about the reviewable decision. We will deal with the questions in the order they were posed, although the answers to the questions sometimes overlap.

   Question one: Are the requirements in s 206F(1)(a) of the Corporations Act preconditions to either or both:

   (a)      the giving of a notice; or

   (b)      the exercise of the power to disqualify persons from managing corporations?

5. As it happens, both parties agreed the answer is ‘yes’ to both limbs of this question. We agree. That conclusion is suggested by a reading of the plain words of the sub-section. If there was any doubt, Mr Golman pointed out the Full Federal Court said as much in Murdaca v Australian Securities and Investments Commission (2009) 178 FCR 119. In that case, North, Kenny and Foster JJ explained (at 143, [101]):

   …

   (a)       Subsection (1) of s 206F comprises, in ascending order of importance:

   (i)A trigger mechanism (the conditions, filters or gateway) embodied in subs (1)(a) (stage 1);

   (ii)A procedural fairness requirement (the giving of a show cause notice and an opportunity to be heard): subs (1)(b) (stage 2); and

   (iii)A merits decision captured in the requirement that ASIC be satisfied that disqualification is justified: subs (1)(c) read with s 206F(2) (stage 3).

   …

6. Mr Knowles, counsel for ASIC, pointed out in written submissions that Murdaca confirms the existence of the trigger requirements referred to in s 206F(1)(a) are matters of objective fact. ASIC is not required to form a view about the adequacy of the s 533(1) report or any other matter at this stage. It is enough that the facts referred to in s 206F(1)(a) exist or have occurred: Murdaca at [98] per North, Kenny and Foster JJ.

7. We note Mr Pike SC, counsel for Mr Golman, speculated in written submissions that ASIC might give a notice before satisfying the requirements in s 206F(1)(a). In those circumstances, he suggested, the power to disqualify would not be engaged – presumably until the preconditions were satisfied. That is not what happened in this case, so we do not need to deal with that possibility any further.

   Question two: Is it necessary that both the winding up of the relevant corporation and the lodgement of the liquidator’s report mentioned in s 206F(1)(a)(ii) of the Corporations Act occur:

   (a)       while the person was an officer of the relevant corporation; or

   (b)      within 12 months after the person ceased to be an officer of the corporation?

8. Mr Pike SC conceded the answer to this question – at least insofar as our decision is concerned – was inevitably ‘No’ given the Full Court’s reasons in Oreb v Australian Securities and Investments Commission (No 2) (2017) 247 FCR 323. In written submissions that were briefly referenced at the hearing, Mr Pike argued the drafting and evident purpose of the provision pointed to a different interpretation notwithstanding the Full Court’s reasons. We disagree. The Full Court’s interpretation in Oreb is consistent with the plain words of s 206F(1)(a)(ii). The sub-section requires that the winding up occur while the person was an officer or within 12 months of that person ceasing to be an officer. That temporal limitation on the operation of that trigger makes sense because an individual’s responsibility for what occurred at the company presumably diminishes, or at least becomes less clear, as time passes following their departure. The word ‘and’ which separates that requirement from the further requirement that the liquidator’s report be lodged operates to separate the two requirements so that each stands alone, with only the first of them subject to the temporal limitation. To be clear: the temporal requirement in s 206F(1)(a)(ii) does not extend to the lodgement of the liquidator’s report under s 533(1) so it is unnecessary to consider whether such report was lodged while the person was an officer or within 12 months of ceasing to be an officer: see Oreb at 337-338, [60]-[61] per Rares, Davies and Gleeson JJ. The quality of the liquidator’s report is unlikely to be degraded over time; indeed, limiting the coverage of the sub-section to a liquidator’s report filed within 12 months of an officer’s departure would undermine the operation of the provision because it may cause liquidators to rush to deliver their reports, which would potentially make them less valuable. There is no cogent reason why the operation of the sub-section would be temporally limited to circumstances where the s 533(1) report is delivered within 12 months after the person ceases to be an officer. The Full Court’s observation in Murdaca (at 143, [101]) that s 206F was intended to provide “a quick and cheap alternative to court action” relative to other provisions in Part 2.6D does not suggest the sub-section should import a time limit that effectively forces the liquidator to rush its report.

9. While we reject the proposition that the sub-section creates a 12-month window for the filing of a liquidator’s report under s 533(1), we note the operation of the provision is subject to an overarching temporal limitation in the introductory words of s 206F(1) which limits the time within which the power can be exercised. Subject to that qualification, we answer the second question ‘No’ and find it is enough that ASIC be satisfied the liquidator’s report was lodged.

   Question three: Is ASIC entitled to give a second or subsequent notice to a person if, in giving the second or subsequent notice, ASIC relies on some of, or alternatively all of, the same matters to satisfy the requirements of s 206F(1)(a)(ii) in relation to the same ‘2 or more corporations’ (as described in s 206F(1)(a)(i) of the Corporations Act) that were relied upon by ASIC in giving the first notice?

10. This awkwardly-worded question focuses attention on whether ASIC may make a decision under s 206F(1) that is premised on the same facts and circumstances relied upon to trigger an earlier decision-making process under the same provision. To use the vernacular: is ASIC permitted to have a ‘second bite at the cherry’ under s 206F – and if so, in what circumstances? The issue lies at the heart of Mr Golman’s concerns about this case. It also raises important questions about the role and powers of the regulator and the Tribunal under the statutory scheme.

11. Mr Golman argues the power in s 206F can only be exercised once in relation to the same trigger event(s). Once it is exercised, the power is spent and ASIC’s role (at least in that regard) is concluded. The power would only become available again if a different trigger were identified – most obviously where the person was an officer of other corporations that are also wound up in insolvency. Mr Golman referred in this connection to a number of well-known authorities including Minister for Immigration and Multicultural Affairs v Bhardwaj (2002) 209 CLR 597 and Minister for Immigration and Ethnic Affairs v Kurtovic (1990) 21 FCR 193.

12. We should mention s 33 of the Acts Interpretation Act at this point. Section 33(1) provides:

    Powers, functions and duties may be exercised or must be performed as the occasion requires

    (1)Where an Act confers a power or function or imposes a duty, then unless the contrary intention appears, the power may be exercised and the function or duty must be performed from time to time as occasion requires.

13. The ordinary effect of the presumption in s 33(1) is clear enough from the text in the sub-section and is subject to any contrary intention.

14. If the presumption in s 33 of the Acts Interpretation Act applies to s 206F(1) of the Corporations Act, ASIC could exercise and re-exercise that power or function from time to time as the occasion required – meaning the power would not be exhausted after it has been exercised once, and the function could be repeated if there was a reason to do so. The question is whether there is anything in s 206F that excludes the presumption and constrains ASIC from commencing more than one decision-making process under the sub-section having regard to the same trigger.

15. Mr Pike referred to the Full Federal Court’s decision in Kurtovic to illustrate how the presumption in s 33 of the Acts Interpretation Act might be displaced. In Kurtovic, Gummow J explained (at 211):

    …in any given case, a discretionary power reposed by statute in the decision maker may, upon a proper construction, be of such a character that it is not exercisable from time to time and it will be spent by the taking of the steps or the making of the statements or representations in question, treating them as a substantive exercise of the power. The result is that when the decision maker attempts to resile from his earlier position, he is prevented from doing so not from any doctrine of estoppel, but because his power to do so is spent and the proposed second decision would be ultra vires. The matter is one of interpretation of the statute conferring the particular power in issue. 

1. Mr Pike says a careful review of the language in s 206F(1) suggests the presumption is displaced. We were told the statute in question contemplates the discretion being exercised only once in connection with a particular trigger event. Mr Pike’s argument to this effect relied heavily on observations made in the Full Court’s judgment in Murdaca where North, Kenny and Foster JJ observed (at 146, [122]):

   Section 206F(1)(b)(i) refers to "a" notice. That is to say, the subsection refers to one single notice – not to notices (plural). In our view, the subsection contemplates the giving of only one notice.

2. Mr Pike explained in his written submissions that this limitation was understandable and necessary. The alternative was to permit ASIC to issue endless notices in respect of the same subject matter, wearing down the individual. That would be oppressive. We were told ASIC might be able to make successive disqualification decisions so that an individual could end up being disqualified for longer than five years, the maximum period of disqualification that can be ordered under s 206F. ASIC might also be able to effectively appeal its own decisions where it suspects the first delegate was too lenient.

3. Mr Knowles, for ASIC, doubted whether the power could be said to be spent in 2018 in circumstances where the delegate on that occasion declined to exercise the discretion to disqualify. That is not an attractive argument. The 2018 delegate completed a decision-making process comprised of several steps including the issue of a notice, conducting a hearing and making a determination, albeit a determination that favoured Mr Golman. Arguing that the power is not spent unless it results in the active exercise of the discretion to disqualify the individual does not answer Mr Pike’s arguments about the operation of the provision. It seems to us there was an exercise of power because the various steps contemplated in the sub-section were all performed.

4. We note Mr Knowles did not press that argument, and we do not think it makes any difference to the outcome in any event. His primary submission was that a proper understanding of the entire legislative scheme suggests the power in s 206F(1) can, in fact, be re-exercised with few limitations. He submitted that this broader perspective was consistent with the High Court’s recent decision in Minister for Immigration and Border Protection v Makasa (2021) 95 ALJR 117. In that case, the High Court was asked to consider the operation of the power in s 501(2) of the Migration Act 1958 (Cth) to cancel a visa on character grounds. The individual’s visa had been cancelled by a delegate of the Minister for Immigration and Border Protection after the individual was convicted of criminal offences in 2009. The cancellation decision was subsequently set aside by the Tribunal. The individual later got into further trouble and the Minister purported to rely on the same power in s 501(2) to personally cancel the visa again. In making the second cancellation decision, the Minister expressly relied on the same 2009 offences that were relied on by the delegate on the previous occasion when he concluded the individual failed the character test. The comparatively minor trouble that occurred following the Tribunal’s earlier decision was only relevant for the purposes of exercising the discretion on the second occasion.

5. The High Court in Makasa concluded the Minister could not simply re-exercise the power under s 501(2) in the absence of any change in circumstances or new information suggesting there was a different factual basis for forming the reasonable suspicion that the visa holder did not pass the character test: at 125, [49]. The reasoning for that conclusion in the unanimous judgment repays careful reading.

6. The Court referred to the provisions of the Migration Act and the Administrative Appeals Tribunal Act 1975 (Cth) (AAT Act) in making its decision. The Court concluded the Tribunal’s power to review the decision of a primary decision-maker and re-exercise the decision-making powers precluded a primary decision-maker under the Migration Act from thereafter re-visiting the decision and re-exercising that power on the same information. To conclude otherwise, the Court reasoned, would undermine the efficacy of the Tribunal as a review mechanism. It would also be contrary to s 43(6) of the AAT Act which had the effect of bringing the decision-making process to an end: Makasa at 126, [51]. The Court explained (at 125-126, [50]):

   The function [of the AAT] would be reduced to a mockery were the subject-matter of the decision made by the AAT on review able to be revisited by the primary decision-maker in the unqualified re-exercise of the same statutory power already re-exercised by the AAT in the conduct of the review.

7. The other provision of the Migration Act that bore on the question was the power of the Minister in s 501A to effectively override a favourable decision that had been made by a delegate or the Tribunal under s 501. The override power expressly authorised the Minister to cancel the visa having regard to the same facts before the other decision-maker if the Minister was satisfied it was in the national interest that the visa be cancelled. The existence of a separate Ministerial power to cancel under s 501A notwithstanding the decision under s 501 was taken to signify Parliament’s intention to exclude a re-exercise of the power under s 501 in the absence of new facts or information: Makasa at 126-127, [52]-[56].

8. The reasoning in Makasa suggests – and ASIC concedes – that ASIC would not be permitted to rely on the same trigger to re-visit or re-exercise the power under s 206F of the Corporations Act if the earlier decision had been reviewed by the Tribunal. There is no reason to suppose that s 43(6) of the AAT Act would not have the same effect of finally concluding the decision-making process that is contemplated under s 206F. But absent a determination by the Tribunal, does Makasa suggest ASIC would be prevented from re‑visiting a process under s 206F against an individual where ASIC relies on the same (or substantially the same) trigger?

9. Mr Pike pointed out ASIC has other alternatives in Part 2D.6 if it wishes to disqualify a director. The existence of those alternative avenues might indicate Parliament intended the power in s 206F should only be exercised once, and that ASIC should be required to resort to the other powers if further action were thought justified. We disagree with that analysis because the other powers in Part 2D.6 are intended to provide ASIC with different pathways for dealing with errant directors. Whereas the Migration Act plainly contemplated the Minister’s power to cancel a visa in the national interest would only be invoked when an earlier decision was made in favour of a visa holder, the alternate pathways in Part 2D.6 of the Corporations Act are all intended for dealing with subtly different situations. The availability of alternatives in Part 2D.6 does not of itself suggest the contrary intention in s 206F to displace the operation of s 33 of the Acts Interpretation Act and so limit the re-exercise of the power in s 206F, should the occasion require. Mr Pike has not identified any other provision of the Corporations Act which suggests a contrary intention that would displace the operation of s 33 of the Acts Interpretation Act.

10. Mr Knowles argued the statement in Murdaca at 146, [122] that the sub-section contemplates the giving of only one notice does not help Mr Golman in this regard. He argued that statement needs to be understood in its context. In Murdaca, ASIC was not seeking to re-exercise the power. Rather, the disqualified person had argued ASIC was not permitted to take into account information about companies that were not mentioned in the notice in the course of a single decision-making process. The Court concluded the ASIC delegate was entitled to take into account other matters at the hearing without the necessity of issuing a further notice, albeit that the delegate might need to take extra steps to ensure procedural fairness: at 146-147, [125]-[126]. The reasoning does not suggest the Court was foreclosing the possibility of a re-exercise of that power, particularly given that possibility was not before the Court at the time.

11. In our view the presumption in s 33 of the Acts Interpretation Act is not displaced, which means ASIC was not precluded from relying on the same trigger events to re-visit the decision-making process under s 206F within the seven-year timeframe contemplated in the sub-section. Having said that, it is important to emphasise that s 33 of the Acts Interpretation Act contemplates the power being re-exercised “as occasion requires”. ASIC would not have occasion to re-exercise the power simply because it was dissatisfied with the outcome it achieved on the first occasion. There would need to be a reason to revisit the question. That would occur most obviously where ASIC became aware of new facts or circumstances that were not before the delegate on the previous occasion. ASIC points out the 2020 decision was made having regard to additional information that was not before the 2018 delegate. As we said earlier in these reasons, although it appears the s 533(1) report dated 5 October 2017 had been delivered to ASIC in time for it to be considered by the 2018 delegate, we were told (and we have no reason to doubt) the report was not taken into account.

12. Our view about the operation of the legislation is consistent with the obvious purpose of s 206F and the surrounding provisions. The power is available to protect the public from the risks posed by corporate managers with a demonstrated track record of failure. The existence of what the Court in Murdaca described as a “quick and cheap alternative to court action” in s 206F underlines the importance of ASIC responding flexibly and exercising its power under 206F from time to time as the occasion requires as the liquidator goes about its work. That flexibility is particularly important in circumstances where ASIC has no effective control over the liquidator’s work. If new information (or information that was not previously considered) provided by the liquidators suggests fresh action under s 206F is warranted, ASIC need do no more than refer to the existence of valid trigger events, regardless of whether those trigger events have been relied on before. Preventing ASIC from revisiting the process as occasion requires (but within the seven-year time limit) would frustrate the purpose of the section and lead to delays in ASIC commencing what are, in essence, protective proceedings.

13. We should add that an applicant who believes he or she is being oppressed by ASIC’s behaviour has the option of seeking review in the Tribunal. While the Tribunal does not supervise ASIC as such, the Tribunal is, first and foremost, a tool of good government. It is independent of the primary decision-maker. The Tribunal will take into account all of the relevant circumstances when it re-exercises the power of the primary decision-maker under s 206F. The Tribunal’s review - which not infrequently involves a more detailed analysis of evidence, including late-breaking developments – is capable of bringing finality to the decision-making process, subject (of course) to the supervision of the Federal Court.

    Question four: In relation to one of the corporations relied upon to satisfy the minimum “2” corporations (as required by s 206F(1)(a)(i) of the Corporations Act), is ASIC entitled to rely on (and therefore issue a second or subsequent notice to a person), each and every time a liquidator lodges a subsequent report under s 533(1) of the Corporations Act in relation to that corporation?

14. The answer to this question is affected by our analysis set out in answer to the third question. ASIC must satisfy itself that the occasion requires it to exercise the power. If it has a reason for revisiting the exercise of the power, ASIC need only satisfy itself as a formal matter that the trigger requirements set out in s 206F(1)(a)(i) have been satisfied once within the timeframe contemplated in the introduction to that sub-section, even if those same events have been relied on before to commence an earlier decision-making process.

15. As a practical matter, we would be surprised if ASIC ever saw fit to re-visit the process in the absence of a fresh report or other information that suggested it was appropriate to re‑exercise the power. Our understanding about that is consistent with the remarks of the Court in Murdaca (at 146-147, [125]-[126]) where it was acknowledged an additional report might be lodged and considered at the hearing before a delegate.

    Question five: On the assumption that:

    (a) the requirements of s 206F(1)(a)(ii) of the Corporations Act have been satisfied in relation to a relevant corporation; and

    (b) ASIC has relied on the requirements of s 206F(1)(a)(ii) in relation to that corporation in giving a previous notice to a person; and

    (c) ASIC, having given the previous notice, has made a decision to disqualify or not disqualify a person from managing corporations under s 206F,

    is ASIC entitled to rely on the same corporation (that it has already issued a notice and made a decision in relation to) for the purposes of satisfying the minimum “2” corporations required by s 206F(1)(a)(i) of the Corporations Act to give a second or subsequent notice to the person?

16. Our answer to this question is ‘yes’, for reasons that should be apparent from the answers given to previous questions – especially the third question. We are satisfied that s 33 of the Acts Interpretation Act allows the exercise of the power provided for in s 206F to be exercised from time to time as the occasion requires.

17. We have already noted Mr Pike referred to a range of authorities including Bhardwaj and Kurtovic in support of its argument that the decision-maker was functus officio following the 2018 decision – at least insofar as the same trigger events were concerned. We referred to the reasoning of Gummow J in Kurtovic in the course of explaining why that is not so in this case but we should say something about the relevance of the decision in Bhardwaj. In that case, an administrative tribunal listed a hearing of an application for review. Prior to the hearing, the applicant’s representatives wrote to the tribunal to advise the applicant was unable to attend. The letter was not brought to the attention of the tribunal member who proceeded to hear and determine the matter in ignorance of the communication. When the tribunal was contacted after making its determination, the tribunal member realised the error and decided to relist the hearing which the applicant attended. The tribunal made a different decision upon review, and the primary decision-maker appealed. The primary decision-maker said the tribunal had discharged its jurisdiction and its authority to revisit what it had already decided was spent.

18. In the course of his reasons, Gleeson CJ explained (Bhardwaj at 602, [5]):

    There is nothing in the nature of an administrative decision which requires a conclusion that a power to make a decision, once purportedly exercised, is necessarily spent. …

19. Having said that, his Honour pointed out (at 602, [6]):

    That general proposition must yield to the legislation under which a decision-maker is acting. And much may depend upon the nature of the power that is being exercised and of the error that has been made.

20. His Honour then explained (at 602, [8]):

    The requirements of good administration, and the need for people affected directly or indirectly by decisions to know where they stand, mean that finality is a powerful consideration. And the statutory scheme, including the conferring and limitation of rights of review on appeal, may evince an intention inconsistent with a capacity for self-correction. Even so, as the facts of the present case show, circumstances can arise where a rigid approach to the principle of functus officio is inconsistent with good administration and fairness. The question is whether the statute pursuant to which the decision-maker was acting manifests an intention to permit or prohibit reconsideration in the circumstances that have arisen. That requires examination of two questions. Has the tribunal discharged the functions committed to it by statute? What does the statute provide, expressly or by implication, as to whether, and in what circumstances, a failure to discharge its functions means that the tribunal may revisit the exercise of its powers or, to use the language of Lord Reid, reconsider the whole matter afresh?

21. His Honour’s point about the dictates of good government is well-taken, but the focus on the legislative scheme is the key. Whereas s 33 of the Acts Interpretation Act creates a presumption that a power can be exercised and re-exercised as required, specific provisions might displace the presumption – so it becomes important to focus on those provisions. We have already explained we are satisfied the power in question in this case is one that can be exercised from time to time as the occasion requires because there is nothing in the statutory scheme that suggests otherwise. We also explained we were inclined to accept the power was exercised in 2018 but that does not alter the conclusion we reached about the power being available in 2020 if the occasion required. We referred to the fact that the ability to re-exercise this specific power without identifying new triggers is consistent with the objective of good government. The very nature of the power in s 206F requires that it should be exercised as quickly as possible but that it remain available in response to evolving circumstances. It would be contrary to the obvious operation of the scheme (as we have outlined it in these reasons) to require ASIC to confine itself to only one exercise of this flexible protective power when liquidations, by their nature, often unearth information over time. Mr Pike raises the possibility ASIC might abuse such a power. The right to review will allow the Tribunal to play a moderating role.

    Question six: Having regard to the answers above, and in the circumstances, was it open to ASIC to issue the notice to Mr Golman on 27 March 2020, and exercise the power under s 206F of the Corporations Act to disqualify Mr Golman from managing corporations?

22. Our answer to this question is also ‘yes’, for reasons that should be apparent from our answers to earlier questions.

    CONCLUSION

23. The Tribunal has jurisdiction to deal with the reviewable decision. The parties should confer on an appropriate timetable to progress the matter towards a final hearing.

I certify that the preceding 48 (forty-eight) paragraphs are a true copy of the reasons for the decision herein of The Hon Justice D G Thomas, President, Deputy President Bernard J McCabe

..........................[SGD]..............................................

Associate

Dated: 12 November 2021

Date(s) of hearing:	8 July 2021
Counsel for the Applicant:	Mr I R Pike SC with Mr T Bateman
Solicitors for the Applicant:	Bridges Lawyers
Counsel for the Respondent:	Mr P Knowles
Solicitors for the Respondent:	Australian Securities and Investments Commission