Hana Group Pty Ltd and Australian Skills Quality Authority
[2019] AATA 4146
•13 June 2019
Hana Group Pty Ltd and Australian Skills Quality Authority [2019] AATA 4146 (13 June 2019)
Division:GENERAL DIVISION
File Number(s): 2019/2698
Re:Hana Group Pty Ltd
APPLICANT
AndAustralian Skills Quality Authority
RESPONDENT
DECISION
Tribunal:Chris Puplick AM, Senior Member
Date:13 June 2019
Place:Sydney
The application for a stay is refused.
............................[sgd]............................................
Chris Puplick AM, Senior Member
CATCHWORDS
PRACTICE AND PROCEDURE – application to stay decision of Australian Skills Quality Authority – decision to cancel registration – prospects of success – consequences for Applicant – public interest – consequences for ASQA – whether review would be rendered nugatory – interests of students – stay application refused
LEGISLATION
Administrative Appeals Tribunal Act 1975 (Cth)
National Vocational Education and Training Regulator Act 2011 (Cth)
CASES
Australian Securities and Investment Commission v Administrative Appeals Tribunal [2009] 181 FCR 130
Department of Workplace Relations and Anastasiadis [2007] AATA 1065
Institute of Training Pty Ltd v Australian Skills Quality Authority [2018] AATA 4127
Madafferi v Minister for Immigration and Multicultural Affairs (2001) 63 ALD 373
Metro College of Technology Pty Ltd v Australian Skills Quality Authority (unreported 2015/6137)
Panganiban and Australian Securities & Investments Commission [2016] AATA 703
Prestige Technical Training Institute Pty Ltd and Australian Skills Quality Authority [2019] AATA 460
Re Alexander and Migration Agents Registration Board (1995) 40 ALD 99
Re Dart and Director-General of Social Services (1982) 4 ALD 553
Re Hollas and Child Support registrar and Simon Rockliff [2002] AATA 480
Re Trades College Australia Pty Ltd and Australian Skills Quality Authority [2018] AATA 1360
Scott v Australian Securities and Investments Commission [2009] AATA 798
Secretary, Department of Employment and Workplace relations and Anastasiadis [2007] AATA 1065
Sher-E-Punjab Ltd v Australian Skills Quality Authority [2018] AATA 46
Trades College Australia Pty Ltd v Australian Skills Quality Authority [2018] AATA 1703
REASONS FOR DECISION
Chris Puplick AM, Senior Member
13 June 2019
STAY APPLICATION
This is an application by the Hana Group (the Applicant) for a stay of a decision made by the Australian Skills Quality Authority (ASQA) to cancel its registration under the National Vocational Education and Training Regulator Act 2011 (the NVR Act).
FRAMEWORK
The NVR Act establishes a framework for the general regulation of the vocational education and training (VET) sector across Australia. It sets standards which must be met by any organisation seeking registration as a Registered Training Organisation (RTO) and thereafter requires an RTO to maintain a level of compliance with standards which are set under the Act. These standards encompass (but are not limited to) such matters as the quality and assessment of courses offered; the qualifications of trainers and teachers; the adequacy of training resources and premises; the competence of the RTO’s management, its governance arrangements and financial viability. ASQA is the body established under the Act as the national regulator.
Where a decision is made under the NVR Act by ASQA to suspend, qualify or cancel an RTO’s registration, that decision may be appealed to the Administrative Appeals Tribunal. Moreover, an application may be lodged for a stay of such an order or decision under section 41(2) of the Administrative Appeals Tribunal Act 1975 (AAT Act) where
“the Tribunal considers (it) appropriate for the purposes of securing the effectiveness of the hearing and determination of the application for review.”
CHRONOLOGY
The Applicant was first registered as an RTO on 21 December 2016 when Mr Bishoy Hana and Ms Georgette Hana were listed as the owners. It was registered to provide training in five courses:
1.Certificate III if Early Childhood Education and Care
2.Diploma in Early Childhood Education and Care
3.Certificate IV in Building and Construction
4.Diploma in Building and Construction
5.Provide Cardiopulmonary Resuscitation.
Evidence before the Tribunal establishes that, at the date of the appeal, the Applicant had never delivered training in either of the two building courses and had no current students enrolled in any of its courses.
On 8 November 2018 ASQA conducted a standard post-initial site Audit to assess the Applicant’s current state of compliance with registration requirements.
At the time of the Audit the Applicant had two students enrolled in the Diploma in Early Childhood Education and Care, both of whom were studying by approved distance education learning arrangements.
In the course of the Audit ASQA also assessed the training products being used by the Applicant at its premises in Castlereagh Street, Liverpool, NSW, and their suitability as an educational facility.
The Audit identified significant issues of non-compliance in relation to the delivery of the two early childhood education and care courses and the cardiopulmonary resuscitation course. As a result, ASQA issued an “Intent Notice” advising the Applicant of its intention to cancel its registration as an RTO. The Notice was issued on 14 January 2019.
As provided by the NVR Act (section 37) the Applicant was afforded the opportunity to comment on the adverse Audit findings and given until 12 February 2019 to do so. The Applicant sought an extension of this time for response and this was granted by ASQA with a revised submission date of 28 February 2019. The Applicant again failed to meet this requirement and, on 27 February requested a further extension of time from ASQA. This was refused on 28 February 2019.
On 24 April 2019 ASQA advised the Applicant that its registration would be cancelled, effective from 29 May 2019.
On 15 May 2019 the Applicant applied to this Tribunal for both a review of the cancellation decision and a stay of the cancellation order. By agreement of the parties a stay was granted until the date of the Tribunal hearing on 5 June 2019 and, following that hearing further extended until 14 June 2019 in order to give the Tribunal time to make its decision.
STAY APPLICATIONS
Stay applications may be brought under section 41(2) of the Administrative Appeals Tribunal Act 1975 (AAT Act) which provides:
(2) The Tribunal may, on request being made by a party to a proceeding before the Tribunal (in this section referred to as the relevant proceeding ), if the Tribunal is of the opinion that it is desirable to do so after taking into account the interests of any persons who may be affected by the review, make such order or orders staying or otherwise affecting the operation or implementation of the decision to which the relevant proceeding relates or a part of that decision as the Tribunal considers appropriate for the purpose of securing the effectiveness of the hearing and determination of the application for review.
It is important to distinguish matters which are relevant for the Tribunal’s consideration in stay applications from those which are not.
In particular, the Tribunal, in stay applications, is not concerned with a merits review of the original decision under appeal, nor with a detailed examination of matters which will ultimately have to be considered by the Tribunal in any full hearing.[1]
[1] Secretary, Department of Employment and Workplace relations and Anastasiadis [2007] AATA 1065; Re Dart and Director-General of Social Services (1982) 4 ALD 553.
What is central to a stay application is the extent to which a stay is necessary, in the express words of section 41(2) of the AAT Act “for the purpose of securing the effectiveness of the hearing and determination of the application for review.”
In other cases this has been referred to as akin to enjoining the Tribunal to “preserve the status quo, so as to ensure that a continuum which is broken by a reviewable decision may be reinstated in order to secure the ultimate effectiveness of the hearing.”[2]
[2] Re Alexander and Migration Agents Registration Board (1995) 40 ALD 99 at [102].
The focus on this central issue was affirmed by the Federal Court in Madafferi where, in relation to an analogous (but not exactly equal) provision in migration legislation the court described as “the primary question” in a stay application, how such a decision “will impact in any way on the effectiveness of the hearing and determination of the appeal.”[3]
[3] Madafferi v Minister for Immigration and Multicultural Affairs (2001) 63 ALD 373 at [24].
Section 41(2) also requires, as its other limb, that the Tribunal have regard to “the interests of any persons who may be affected by the review.”
The Tribunal recognises that the principles in Madafferi have been called into question as perhaps excessively narrowing the focus of the Tribunal’s considerations, the Tribunal still regards following this “narrower test”[4] as the preferred approach.
[4] Re Hollas and Child Support registrar and Simon Rockliff [2002] AATA 480.
Something akin to a “check list” of items for consideration in stay applications was provided by then AAT President Downes in Scott[5] as follows:
Application having been made for a stay of proceedings under s 41 of the Administrative Appeals Tribunal Act 1975, it is nevertheless incumbent upon me now to consider whether a stay is appropriate. In considering the application, it is appropriate for me to consider a range of matters, including:
(1) The prospects of success.
(2) The consequence for the applicant of the refusal of a stay.
(3) The public interest.
(4)The consequences for the respondent in carrying out its functions depending upon whether a stay is granted or not.
(5) Whether the application for review would be rendered nugatory if a stay were not granted.
(6) Other matters that are relevant, amongst which I would include the length of time that the ban has already been in place and the gap between today and the hearing of the application.
[5] Scott v Australian Securities And Investments Commission [2009] AATA 798 at [4].
The issues for the Tribunal’s consideration in stay applications has also been elucidated by Senior member Taylor SC in Panganiban[6] to include:
[6] Panganiban and Australian Securities & Investments Commission [2016] AATA 703 at [7].
(a) an applicant’s prospects of success, in obtaining a materially different outcome as a result of the review proceeding;
(b) the functions and responsibilities of the statutory decision maker, the nature and purpose of the reviewable decision, and the public interest in relation to it;
(c) the reasons proffered to support, or oppose, the stay application, and the potential practical consequences of any stay;
(d) the practical consequences of the decision under review (to the parties and to any interested persons), unless its operation is the subject of a relevant stay, after taking into account:
(i) conditions that might be imposed as a term of any stay;
(ii) the timing of the reviewable decision, the application, and any likely review hearing;
(iii) the ability of the applicant to pursue the review proceedings effectively; and
(iv) the likely practical utility of any favourable review outcome.
It should also be noted that Deputy President Forgie, in reference to the “check list” in Scott has observed that it “should not be regarded as a comprehensive list of all matters that may be relevant in a particular case.”[7]
[7] Trades College Australia Pty Ltd v Australian Skills Quality Authority [2018] AATA 1703 at [38].
However as the two cited lists encompass essentially the same material the Tribunal proposes to consider this application against the tests outlined in Scott.
However it is important to note that the grant of a stay is entirely at the discretion of the Tribunal, there is no automatic right to obtain a stay. Furthermore, a stay is not to be seen as a mechanism for either subverting the decision of the Regulator; providing time for additional compliance steps to be taken[8] or avoiding the consequences of any actions by an applicant which have led to a cancellation decision.[9]
[8] Prestige Technical Training Institute Pty Ltd and Australian Skills Quality Authority [2019] AATA 460 at [21].
[9] Metro College of Technology Pty Ltd v Australian Skills Quality Authority (unreported 2015/6137) at [5].
Nor should the stay be granted simply in relation to the interests or position of the applicant without considering the interests of other parties as required by section 42(2) of the AAT Act.[10] In this respect consideration of the interests of staff, students, the Regulator (ASQA) and the general public may be relevant.
TURNING TO THE TESTS IN SCOTT
[10] Sher-E-Punjab Ltd v Australian Skills Quality Authority [2018] AATA 46 at [102]-[110].
Prospects of success: The Tribunal again emphasises that this is not the place for the substantial merits of the application to be argued, rather, the Tribunal has to be persuaded that the Applicant has, in putting their best foot forward, established that there is sufficient evidence to call into question the merits of ASQA’s cancellation decision.[11]
[11]Department of Workplace Relations and Anastasiadis [2007] AATA 1065 at [51]; Re Trades College Australia Pty Ltd and Australian Skills Quality Authority [2018] AATA 1360 at [19].
In this respect the Applicant has done itself no favours in failing to put to ASQA any evidence of its compliance activities when given the opportunity to do so. Nor was the Tribunal assisted by the Applicant providing several hundred pages of documents less than 24 hours before the Tribunal’s scheduled hearing.
Nevertheless, to the extent that it has been able to do so, the Tribunal has considered the material supplied by the Applicant against the listed non-compliances identified by ASQA. In particular, the Tribunal takes note of the non-compliances identified in terms of the premises and the equipment, that is to say the unsuitability and lack thereof, in relation to the course in pulmonary resuscitation and the general lack of a coherent strategy to remedy non-compliance apart from the engagement of two external consultants (Mr Chris Stephens and Ms Judith Bowler[12]).
[12]Statement of Georgette Hana (dated 4 June 2019) at paragraph [6]-[8].
Mere assurances that the consultants believe that the non-compliances have been remedied are insufficient.[13] Their reports, such as they may be, have not been examined by ASQA[14] nor the Tribunal and the detailed “Rectification Report” submitted by the Applicant less than 24 hours before the hearing did not permit sufficient time for a detailed analysis by the Tribunal. In any event that is not the role of the Tribunal in these proceedings, such reports are matters for consideration in the merits review.
[13]Statement of Georgette Hana (dated 4 June 2019) at paragraph [9].
[14] Respondent’s Supplementary Outline of Submissions (dated 5 June 2019) at paragraph [3].
In her statement to the Tribunal, Ms Georgette Hana, on behalf of the Applicant, writes:
“To this extent, I seek a stay of the decision from ASQA and I undertake not to advertise or otherwise teach the four RTO courses that are currently on the scope of registration for the College. I understand that this will mean that I will not be able to offer any of these courses to any students.”[15]
[15]Statement of Georgette Hana (dated 4 June 2019) at paragraph [25].
The Tribunal can only agree with the submission of ASQA to the effect that:
“The Applicant has in effect “run up the white flag” in relation to attaining compliance and operating and effective, compliant training organisation.”[16]
[16] Respondent’s Outline of Submissions (dated 5 June 2019) at paragraph [54(x)].
On the basis of the material before it the Tribunal cannot conclude that the prospects of success, given the Applicant’s past record and the details of responses to the Audit to date, are indicative of a serious prospect of final success.
Consequence for the Applicant: While it may be the case that there have been a number of fee-paying students undertaking a short course offered in “Delivery of Aid and Deliver CPR”[17] and which the Applicant intends to continue to offer/teach[18], the evidence suggests that at the time of the Audit there were only two enrolled students (undertraining distance courses) and at the time of the April cancellation notice the College had no enrolled students.[19] The Tribunal also notes that in the Applicant’s submitted Responses attached to Ms Hana’s submission of 4 June 2019 it is stated that:
“There have been no enrolments in the past six months and as such there has been no impact of non-compliance to students.”[20]
[17] A course of this description does not appear in any of the formal registered courses discussed in the Audit Report or otherwise identified in documents before the Tribunal. Although see Statement of Georgette Hana (dated 4 June 2019) at paragraph [27].
[18]Statement of Georgette Hana (dated 4 June 2019) at paragraph [31].
[19] Affidavit of Ms Petra Petersen, Lead Regulatory Officer, ASQA (dated 4 June 2019) at [40].
[20] Applicant’s Table of Responses at page [4].
The Tribunal accepts the Applicant’s statement that “the College does not have much money in the bank”[21] and that employees may have to be terminated. This however could equally well be the inevitable consequence of the Applicant’s current undertaking/concession not to enrol or teach students in any of the registered courses even were the stay to be granted. The Tribunal also noted that the Applicant has engaged two consultants to assist it in this matter and presumably has the resources to ensure that both are remunerated adequately.
[21] Statement of Georgette Hana (dated 4 June 2019) at paragraph [25].
The public interest resides in having a VET system which has integrity and regards non-compliance as a serious matter which carries significant consequences. Section 2A of the NVR Act sets out the Act’s objectives:
Objects
The objects of this Act are:
(a) to provide for national consistency in the regulation of vocational education and training ( VET ); and
(b) to regulate VET using:
(i) a standards-based quality framework; and
(ii) risk assessments, where appropriate; and
(c) to protect and enhance:
(i) quality, flexibility and innovation in VET; and
(ii) Australia's reputation for VET nationally and internationally; and
(d) to provide a regulatory framework that encourages and promotes a VET system that is appropriate to meet Australia's social and economic needs for a highly educated and skilled population; and
(e) to protect students undertaking, or proposing to undertake, Australian VET by ensuring the provision of quality VET; and
(f) to facilitate access to accurate information relating to the quality of VET.
Ensuring that these objectives are met is in the public interest. In an earlier case decided by this Tribunal, I stated:[22]
(61)However, the authority of ASQA should be given considerable respect in such proceedings as it is the essential guardian of the integrity of the VET regulation system. The Tribunal must have regard to the fundamental elements of the regulatory scheme in assessing stay decisions.[23] In this instance section 2A of the NVR Act includes among its objects national consistency in regulation and the protection of students.
(62)If ASQA’s decisions are to be either stayed (or in other instances, set aside) then the Tribunal believes that it is incumbent upon any Applicant to demonstrates that those “special circumstances” referred to in Anastasiadis have been established.
[22] Institute of Training Pty Ltd v Australian Skills Quality Authority [2018] AATA 4127.
[23] Australian Securities and Investment Commission v Administrative Appeals Tribunal [2009] 181 FCR 130 at [53].
The consequences for the Respondent may be briefly stated as allowing it a degree of certainty as to the management of its decisions (subject to the final merits review application) and allowing it to conduct its business in an orderly fashion once cancellation decisions have been notified. These consequences do not weigh heavily with the Tribunal as any legislated appeals system carries within it the inherent interruption of normal business activities by regulators, something which the Parliament intended that they manage.
Rendering the merits hearing nugatory: In this instance the Tribunal accepts that the Applicant will find itself in financial difficulty were a stay not to be granted, but it is unpersuaded that this would be in any way different were it granted. The Applicant has no students in its designated courses nor has it ever delivered training in two of the four courses and it has delivered training to only a limited number of students in the others. The Tribunal heard no evidence in relation to the reserves which might be available to the Applicant which, since it has been operational since 2016, might be expected to exist.
Key issues raised by ASQA in relation to the qualification of trainers (in particular Ms Hana); the position of the Chief Executive Officer; the status of leases on educational premises; the validity of assessment tools and the suitability of equipment, none of which this Tribunal is in a position nor has a mandate to judge, will all be in exactly the same position at the date of the merits hearing as they are now. Nothing in that respect will change or be prejudiced for the Applicant. Indeed, in that respect the requirement in the AAT Act of securing the effectiveness of the hearing and determination of the application for review will be maintained.
Other relevant matters include consideration of “the interests of any persons who may be affected by the review” as per the AAT Act. There are none not already identified. Apart from the principals and the staff of the College, there are no students or external parties with an identifiable interest in this matter. A stay is in operation until the decision of the Tribunal and so there is no need to consider matters in relation to any length of time already encompassed although no specific date is yet established for the merits-hearing of the appeal.
DISCUSSION
The Applicant has demonstrated a lack of co-operation with the regulator (ASQA) in terms of its response within a period of almost five months (14 January to 4 June 2019) to its Notice of Intent to deregister. The Tribunal cannot have confidence that the material presented at the very last moment is sufficient to satisfy any examination as to its success in achieving compliance, indeed, a reading of Ms Hana’s statement of 4 June 2019 together with the Affidavit of Ms Petersen and ASQA’s two outlines of submissions (dated 4 and 5 June respectively) would suggest the contrary.
The Tribunal does not believe that the Applicant satisfies any of the tests outlined in Scott justifying the continuation of the current stay order. It judges prospects of success at a full merits hearing to be limited and that its current situation would not be significantly worse at that hearing to render it nugatory. The consideration of the interests of the Applicant, the Respondent and the public suggest that no adequate grounds for continuation of the stay have been made out. The evidence before the Tribunal is too weak to justify an effective setting aside of the ASQA decision and to allow the Applicant to continue with its current operations, such as they are.
DECISION
The application for a stay is refused.
I certify that the preceding 44 (forty -four) paragraphs are a true copy of the reasons for the decision herein of Chris Puplick AM, Senior Member
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Associate
Dated: 13 June 2019
Date(s) of hearing: 5 June 2019 Solicitors for the Applicant: Mr P Doukas, Denison Toyer Pty Ltd (by phone) Solicitors for the Respondent: Mr T Lloyd, Australian Skills Quality Authority (by phone)
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