Happy 'N' Friendly Day Care Pty Ltd and Secretary, Department of Education and Training

Case

[2018] AATA 4676

21 December 2018


Happy 'N' Friendly Day Care Pty Ltd and Secretary, Department of Education and Training [2018] AATA 4676 (21 December 2018)

Division:GENERAL DIVISION

File Number(s):      2018/7003

Re:Happy 'N' Friendly Day Care Pty Ltd

APPLICANT

AndSecretary, Department of Education and Training

RESPONDENT

DECISION

Tribunal:Chris Puplick AM, Senior Member

Date:21 December 2018

Place:Sydney

The application for a stay of the Department’s decision of 21 November 2018 is refused.

...........................[sgd]......................................

Chris Puplick AM, Senior Member

CATCHWORDS

PRACTICE AND PROCEDURE – request for stay order – decisions under review to cancel registration as a provider of day care services under A New Tax System (Family Assistance)(Administration) Act 1999 (Cth) – factors to be considered in deciding whether to grant a stay – stay refused

LEGISLATION

Administrative Appeals Tribunal Act 1975

Administrative Decisions (Judicial Review) Act 1977

A New Tax System (Family Assistance)(Administration) Act 1999

Education and Care Services National Law Act 2010

CASES

Australian College of Vocational Studies Pty Ltd v Australian Skills Quality Authority (General) [2018] AATA 1088

Azaria Family Day Care Pty Ltd v Secretary, Department of Education and Training [2018] FCA 1640

Collector of Customs (NSW) v Brian Lawlor Automotie Pty Ltd (1979) 24 ALR 307

Galaxy Day Care Pty Ltd v Secretary, Department of Education and Training [2018] FCA 1549

Institute of Training Pty Ltd and Australian Skills Quality Authority [2018] AATA 4127

Madafferi v Minister for Immigration and Multicultural Affairs [2001] 63 ALD 373

Moonlight Family Day Care Pty Ltd and Secretary, Department of Education and Training [2018] AATA 2706

Panganiban and Australian Securities & Investments Commission  [2016] AATA 703

Re Alexander and Migration Agents Registration Board [1995] 40 ALD 99

Re Confidential and Australian Prudential Regulation Authority [2002] AATA 1346

Re Dart and Director-General of Social Services (1982) 4 ALD 553

Re Dekanic and Tax Agents’ Board of New South Wales [1982] 6 ALD 240

Re Hollas and Child Support registrar and Simon Rockliff [2002] AATA 480

Re Metro College of Technology Pty Ltd and Australian Skills Quality Authority (unreported) [2015] Application 2015/6137

Re Pelling and Secretary, Department of Aviation [1984] 5 ALD 638

Re Secretary, Department of Employment and Workplace Relations and Hitchcock [2006] AATA 1127

Rust-Oleum Australia Pty Ltd and Australian Pesticides & Veterinary Medicines Authority [2017] AATA 298

Samir Pty Ltd and Aged Care Standards and Accreditation Agency [2012] AATA 333

Scott v Australian Securities And Investments Commission [2009] AATA 798

Secretary, department of Employment and Workplace relations and Anastasiadis [2007] AATA 1065

Sunrising Family Day Care Pty Ltd and Secretary, Department of Education and Training [2018] AATA 1463

Technical Education Australia Pty Ltd and Australian Skills Quality Authority [2018] AT 3047

Trade College Australia Pty Ltd v Australian Skills Quality Authority [2018] AATA 1703

REASONS FOR DECISION

Chris Puplick AM, Senior Member

21 December 2018

  1. This is an application for the stay of a decision made by the Department of Education and Training (the Respondent) to cancel the registration of Happy ‘N’ Family Day Care Pty Ltd (the Applicant) as a provider of day care services under the A New Tax System (Family Assistance)(Administration) Act 1999 (the Act)[1].

    [1] Also referred to generically as “the family assistance law”.

    BACKGROUND

  2. On 25 September 2018 the Respondent cancelled the Applicant’s approval pursuant to its powers under section 195H(1) of the Act. On 9 October 2018 the Applicant sought an internal review of the cancellation decision.

  3. The Applicant also appealed to the Federal Court for a stay of that decision on 19 October 2018 under the Administrative Decisions (Judicial Review) Act 1977.

  4. The Federal Court granted a stay until 16 November 2018 in order to provide time for the internal review to be conducted.  On 15 November 2018 the Respondent notified the Applicant that its internal review had resulted in an affirmation of the original cancellation decision.

  5. The Applicant returned to the Federal Court on 16 November 2018 requesting a further stay until an appeal against the decision could be heard by this Tribunal and, on the 28 November 2018 applied to this Tribunal for such a review. The Federal Court, by consent of the parties, granted a stay effective to the date on which the Tribunal “determines the Applicant’s application for a stay of the Decision”.

  6. The hearing for a stay order as requested by the Applicant was heard in this Tribunal on 20 December 2018.

    STAY APPLICATIONS

  7. 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.

  8. It is important to distinguish matters which are relevant for the Tribunal’s consideration in stay applications from those which are not.

  9. 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.[2]

    [2] Secretary, department of Employment and Workplace relations and Anastasiadis [2007] AATA 1065; Re Dart and Director-General of Social Services (1982) 4 ALD 553.

  10. What is central to a stay application is the extent to which a stay is necessary, in the express words of s. 41(2) of the AAT Act “for the purpose of securing the effectiveness of the hearing and determination of the application for review.”

  11. In other cases this has been referred to as akin to enjoining the Tribunal to “preserve the staus 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.”[3]

    [3] Re Alexander and Migration Agents Registration Board [1995] 40 ALD 99 at [102].

  12. 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.”[4]

    [4] Madafferi v Minister for Immigration and Multicultural Affairs [2001] 63 ALD 373 at [24].

  13. 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”[5] as the preferred approach.

    [5] Re Hollas and Child Support registrar and Simon Rockliff [2002] AATA 480.

  14. 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 will give consideration to who might, in this instance, be encompassed by such a description, below.

  15. These limbs of section 41(2) of the AAT Act are distinguishable from the “balance of convenience” which was the basis upon which the Federal Court stay was granted[6] and which was used in the Tribunal’s 1982 decision in Dekanic.[7]

    [6] Galaxy Day Care Pty Ltd v Secretary, Department of Education and Training [2018] FCA 1549 at [29].

    [7] Re Dekanic and Tax Agents’ Board of New South Wales [1982] 6 ALD 240 at [242].

  16. Something akin to a “check list” of items for consideration in stay applications was provided by then AAT President Downes in Scott[8] 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.

    4The 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.

    [8] Scott v Australian Securities And Investments Commission [2009] AATA 798 at [4].

  17. The issues for the Tribunal’s consideration in stay applications has also been elucidated by Senior member Taylor SC in Panganiban[9] to include:

    [9] 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.

  18. 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.”[10]

    [10] Trades College Australia Pty Ltd v Australian Skills Quality Authority [2018] AATA 1703 at [38].

  19. However as the two cited lists encompass essentially the same material the Tribunal proposes to consider this application against the tests outlined in Scott.

  20. In order to undertake this exercise the Tribunal must have regard to some of the more detailed matters leading to the original cancellation decision and the Applicant’s response to it.

    SPECIFIC CONSIDERATIONS

  21. On 23 April 2018 the Respondent notified that Applicant that it was giving consideration to the cancellation of its registration for approval under the family assistance law. The Applicant was invited to respond to this notice which it did on 21 May 2018. After consideration of the Applicant’s submission the Respondent, on 25 September notified it of its decision to cancel its approval.

  22. On 9 October 2018 the Applicant (via its solicitor) sought an internal review of the cancellation decision and this was followed by the Applicant’s notice to the Respondent that they were seeking judicial review of the decision in the Federal Court. In that court a stay order was made against proceedings until 16 November 2018.

  23. As noted above, on 15 November 2018 the Respondent affirmed its original decision and after the grant of further stay in the Federal Court that matter now comes before the Tribunal for determination of a stay order sought on 28 November 2018 which would have the effect, if granted, of staying the cancellation until such time as the Tribunal heard the merits review of the original decision.

  24. The basis of the cancellation decision lies in the Respondent having found the Applicant to be seriously non-compliant, and indeed misleading, in its reporting of its activities under section 219N of the Act; making false claims for payment of child care benefits, including:

    ·211 instances where payments were made but the relevant educators were overseas at the time

    ·567 instances where payment were made but the child in question was overseas

    ·718 instances of “child swapping” where payments were made to non-eligible individuals

    ·2350 occasions where payments were made in respects of children who were either in school or else over the age of 14 years when no such payments should have been claimed.

  25. These identified breaches occurred in the period from 1 January 2016 to 18 April 2018.

  26. Moreover there appear to have been breaches of statutory requirements related to the passing-on to parents, or remitting to the Commonwealth, monies related to child care fee reductions.

  27. In addition to these instances, the Respondent notes (and categorises) some 4,313 instances which it describes as “further apparent contraventions of the family assistance law”. 

  28. The Respondent also identified these breaches or non-compliance which had taken place after the issuing of the original notification to the Applicant of the possible imposition of sanctions.[11]  

    [11] Respondent’s Submission in support of opposition to stay application, dated 11 December 2018 at [36]-[46].

  29. On behalf of the Applicant, Mr Hibo Gulleid, a director of the company has provided two substantial affidavits outlining the Applicant’s response to various concerns of the Respondent and outlining the remedial steps taken by the Applicant to address them.

  30. Mr Gulleid outlines measures including:

    ·Continuing the practice of self-auditing of the records but introducing a new fortnightly review system supported by processes to rectify reporting errors within 28 days;

    ·Ensuring that Co-ordinators are in touch with educators on a weekly basis and supplementing this with unannounced inspection of educator’s premises, and

    ·Implementing a new system whereby educators are to be contactable every day that they are providing care.

  31. In addition Mr Gulleid commits the Applicant to the repayment to the Commonwealth of any subsidy amounts incorrectly received.[12]

    [12] Hibo Gulleid Affidavit dated 27 November 2018 at [50].

  32. The Respondent rejects these proposals as being without any weight in relation to the stay application; merely undertaken in response to the proposed sanctions process; failing to address issues of future compliance and not being an adequate response to its previous non-compliance record.[13]

    [13] Respondent’s Submission in support of opposition to stay application, dated 11 December 2018 at [47]-[48].

  33. As the Tribunal has stated already, it is not its responsibility (nor within its powers) to examine these matters in detail at this stage and resolve (or decide) any disputes between the parties. That would be the Tribunal’s role at the merits/review hearing.

  34. The contending positions are however germane to the consideration of the Tribunal’s analysis of the tests laid out in Scott.

    WHAT ARE THE PROSPECTS OF SUCCESS IN A FULL MERITS HEARING?

  35. Although there is some recent authority suggesting that “Prospects of success have no place”[14] in the considerations of the Tribunal, nevertheless it has been the Tribunal’s past practice to give them at least some consideration, albeit within the strictures of section 41(2) of the AAT Act.

    [14] Rust-Oleum Australia Pty Ltd and Australian Pesticides & Veterinary Medicines Authority [2017] AATA 298 at [36] per DP Forgie.

  36. The Tribunal cannot, on the material before it, rate such prospects favourably, despite the submissions of the Applicant, both in terms of Mr Gulleid’s affidavits and the evidence at the hearing. There has been an identified history of substantial non-compliance in a number of areas and over a prolonged period of time. Even after the original notification of an intention to impose sanctions, breaches and non-compliance continued. [15]

    [15] Respondent’s Submission in support of opposition to stay application at [45].

  37. While the Applicant disputes some of the claims of the respondent, and in some instances disclaims direct responsibility for breaches,[16] it does not deny the substance of the claims related to its non-compliance. It asserts that:

    “In summary, when regard is had to the circumstances in which the uncontested contraventions occurred, and the steps taken by the respondent to address those alleged breaches, there are reasonable prospects of success in arguing that a different decision, including a sanction other than variation, should have been made.”[17]

    [16] Applicant’s Submission in support of stay application, dated 18 December 2018 at [13].

    [17] Ibid at [26].

  38. Putting aside that the failures are either “uncontested contravention” or “alleged breaches” but cannot be both, the Applicant does not advance any rationale for an alternate sanction within the range of section 195H of the Act, nor does it present the Tribunal with significant evidence of the measures which it took to avoid breaches after the first cancellation notification or those which has implemented more recently.

  39. In the Applicant’s submissions at hearing, it was argued that the Applicant would contest the substance of the findings of the Audit and the respondent as to the extent of alleged breaches or contraventions. It was put to the Tribunal that 2,968 instances would be disputed and that these constituted “the majority” of the alleged breaches or contraventions. Even were the Applicant to be successful on each of these, that would still leave the number of uncontested findings at an unacceptably high level by any standards.

  40. The Applicant put to the Tribunal that the failures to meet the requirements of accurate reporting under section 219N of the Act were not the responsibility of the Principal but rather of its servants and that the matters outlined in Mr Gullein’s first affidavit should be taken as evidence that adequate remediation activity was in place.

  41. Although the Federal Court has expressed a view that the “errors of others” may be a mitigating factor which should be given “proper consideration”,[18] it remains fundamental to the whole regulatory scheme that ultimate responsibility lies with the Principal of any registered organisation. As the Tribunal said in Moonlight Family Day Care Pty Ltd and Secretary, Department of Education and Training:

    “Finally, I see no merit in Moonlight blaming the educators involved: Moonlight had a clear obligation imposed on it by Commonwealth law and it is not in point to explain away failure to meet that obligation by referring to the error of others. This shows us in my view as a failure of governance which is central to the admitted breaches of the Applicant.”[19]

    [18] Azaria Family Day Care Pty Ltd v Secretary, Department of Education and Training [2018] FCA 1640 at [33]-[36].

    [19] Moonlight Family Day Care Pty Ltd and Secretary, Department of Education and Training [2018] AATA 2706 at [26].

  42. This particular Tribunal considered very similar matters in Sunrising Family Day Care Pty Ltd and Secretary, Department of Education and Training[20] and came to the conclusion that the steps proposed by way of remediation were inadequate and not likely to be of effect. All the same elements of both non-compliance and response are evident in this instance and the Tribunal sees no reason to come to a conclusion different from that in its previous determination.

    [20] Sunrising Family Day Care Pty Ltd and Secretary, Department of Education and Training [2018] AATA 1463.

  43. In that same determination the Tribunal also noted, with reference to where responsibility for preventing misreporting to the Department laid that: “Critically, what needs to be in place as a condition precedent of any complying operation is a sound and effective governance structure.”[21]

    [21] Ibid at [126].

  1. Similarly, in Australian College of Vocational Studies, the Tribunal expressed a view that the degree of “urgent remedial work” which that applicant would need to implement in order to justify a stay was of such an order of magnitude as to render its prospects of ultimate success so limited that it was a factor weighing against the grant of a stay.[22]

    [22] Australian College of Vocational Studies Pty Ltd v Australian Skills Quality Authority (General) [2018] AATA 1088 at [47].

  2. The weight of evidence before the Tribunal at this stage (which may of course be different when the full merits/review hearing is held) clearly tip the balance of probabilities against the success of the Applicant at the review stage.

    WHAT ARE THE CONSEQUENCES FOR THE APPLICANT IF STAY IS REFUSED?

  3. There is no doubt that there would be adverse consequences for the Applicant in terms of loss of revenue, loss of employment and perhaps reputational damage.

  4. The Tribunal is aware that potential hardship to the Applicant from an economic point of view is a legitimate concern to be put before it.[23] It is also aware that with each case to be examined on its individual merits, the Tribunal may also take into account the extent to which the Applicant’s financial position is one brought about by its own actions.[24] Finally there is authority to make clear that issues of financial hardship are, in and of themselves, not sufficient and may need to be balanced against other factors such as the public interest.[25]

    [23] Re Secretary, Department of Employment and Workplace Relations and Hitchcock [2006] AATA 1127 at [7]-[8].

    [24] Re Confidential and Australian Prudential Regulation Authority [2002] AATA 1346.

    [25] Re Pelling and Secretary, Department of Aviation [1984] 5 ALD 638.

  5. The question of the Applicant’s financial position is one of obvious dispute between the parties. Not only are there matters related to the Applicant’s principal operation in Victoria, but the Applicant also operates a similar service in Brisbane.[26] Exactly how they interrelate in a financial sense if not clear although Mr Gulleid asserts that the profits of the Brisbane operation would not be sufficient to offsets potential losses in Victoria with the result that there is a risk of the company becoming insolvent.[27]

    [26] Hibo Gulleid, Affidavit dated 18 December 2018 at [3]-[11].

    [27] Ibid at [24(c)].

  6. Some of the material appended to Mr Gulleid’s affidavits, especially that of 18 December 2018, do serve to elucidate some relevant details, but they are also, in large part speculative and predictive on a basis which is questionable and dependent upon both future student and educator numbers.

  7. It should be noted that the cancellation decision, in and of itself, does not preclude the Applicant from continuing to offer child care services. The cancellation goes to the question of subsidy payments not capacity to operate. As long as the Applicant continues to be (as it is) licenced to operate in Victoria under the National Law,[28] then it is free to continue to offer its services. Its viability then becomes a matter more for the market than the Tribunal to determine.

    [28] Education and Care Services National Law Act 2010.

  8. However, it must be repeated that the financial or employment consequences of the refusal of a stay are not the central issues – the issue is the extent to which the stay is necessary to allow the Applicant to pursue its rights and opportunities in “securing the effectiveness of the hearing and determination of the application for review.”

  9. The Applicant urged upon the Tribunal the proposition that, in the absence of income from child care benefits, not only would it suffer financial disadvantage (with the potential to be put into liquidation) but that equally it would be unable to sustain adequate legal representation to allow the substantive issues to be determined in the merits review.[29]

    [29] Applicant’s Submission in support of stay application, dated 18 December 2018 at [44].

  10. The contended financial position as exposed in the submissions of both parties does not allow for any clear resolution of this matter. It appreciates that cash flow problems are the inherent curse and weakness of small business operations, but it cannot say with any certainty either what the Applicant’s reserves/liquid assets are, not what the cost of its legal proceedings might be.

  11. It is thus not in a position to conclude that the loss of subsidy (for what might be a relatively short period of time) would cause the Applicant to become so financially compromised that it would not be able to sustain its ongoing legal case and thus render the prospect of any future hearing or determination nugatory.

    THE PUBLIC INTEREST

  12. In another decision given by this specific Tribunal, the centrality of the public interest in considering stay applications was highlighted. On that occasion this Tribunal stated:

    “In the view of the Tribunal, the public interest is best served by not allowing the Applicant to continue to operate, as it is, in a way which is non-compliant with the Standards and in the absence of immediate and effective remedial action having commenced.”[30]

    [30] Institute of Training Pty Ltd and Australian Skills Quality Authority [2018] AATA 4127 at [87].

  13. A similar position was outlined in Trade College Australia Pty Ltd and Australian Skills Quality Authority[31] where the Tribunal held that the public interest in having a registered provider meet the required standards and conditions laid down in legislation outweighed any disadvantage to an individual non-complying provider.

    [31] Trade College Australia Pty Ltd and Australian Skills Quality Authority [2018] AATA 1703 at [67].

  14. Regulatory bodies are established, in part, to ensure that the public interest is protected in the areas of their competence and the Tribunal should be cautious about taking steps which may derogate from the protection of that public interest by failing to give due regard (although not unqualified deference) to their assessments in such matters. As the Tribunal said in Metro CollegeThe regulatory regime assumes there is a public interest in ensuring these programs are properly run according to recognized standards.”[32]

    [32] Re Metro College of Technology Pty Ltd and Australian Skills Quality Authority (unreported) [2015] Application 2015/6137 at [10].

  15. In relation to this consideration the Tribunal regards with some concern the statement in the Applicant’s formal Submission to the effect that:

    “While the applicant accepts that the risk to public funds as a result of overpayment would be a public interest factor against a stay, the applicant submits that that factor should not be given significant weight in the present  case….”[33]

    [33] Applicant’s Submission in support of stay application, dated 18 December 2018 at [35].

  16. It then goes on to outline five reasons why this should be so, ranging from disputes as to the quantum, the amount taken as part of the Applicant’s overall receipt of child care payments, offers to repay and promises of system control improvements.[34] Although it is not the Tribunal’s role, at this stage, to analyse the validity of these qualifications, it cannot but be influenced by the approach of asking that any “risk to public funds” should not be given significant weight.

    [34] Ibid at [36].

    THE CONSEQUENCES FOR THE RESPONDENT IF A STAY  GRANTED

  17. This issue was clearly articulated by Senior Member Taylor in Panganiban[35] as follows (citations omitted)

    9. The precondition requiring the Tribunal to take into account “the interests of any persons who may be affected by the review” ordinarily requires the Tribunal to have regard to the decision maker’s position in relation to the stay application: AAT Act s 41(4). Together with the basic criteria for the exercise of the stay power, it also requires the Tribunal to have regard to the statutory scheme relevant to the reviewable decision. This is because the statutory scheme is likely to be critical to a proper understanding of both the practical consequences of the reviewable decision, and the relevance of the public interest to that decision, and to the exercise of the stay discretion.

    10. The nature of the procedures involved in the reviewable decision, the specificity of the findings the decision involves, and the interests the exercise of the statutory power are intended to serve, may provide a proper basis for refusing a stay application. They are particularly likely to do so where the available material does not conduce to an appropriate degree of satisfaction that the review process has a substantial prospect of a more favourable outcome.

    [35] Panganiban and Australian Securities & Investments Commission  [2016] AATA 703.

  18. As already indicated in reference to public interest considerations, the integrity of regulatory schemes and the central role of the systems regulator are proper matters for the Tribunal’s consideration[36].

    [36] Trade College Australia Pty Ltd v Australian Skills Quality Authority [2018] AATA 1703 at [40],[63], [67].

  19. The Tribunal notes that the respondent outlines a number of steps which it states it will have to take were a stay granted, eligibility established for individuals and possible consequences if that eligibility were to be overturned by the final merits/review decision.[37] While the Tribunal appreciates this, it sees these, from the point of view of any organisation as large and sophisticated as the Respondent more as an inconvenience rather than a significant burden.

    [37] Respondent’s Submission in support of opposition to stay application at [92]-[94].

    POSSIBLY RENDERING THE FINAL REVIEW PROCESS NUGATORY

  20. The Applicant has not demonstrated to the Tribunal that it would be unable to carry forward its appeal against the reviewable cancellation decision, other than advancing arguments about the immediate financial impact of no stay being granted on its business operations.

  21. The Tribunal has accepted the principle that where an applicant, by virtue of a stay not being granted, is genuinely likely to become insolvent and cease to operate, then that would mean that “the Applications would be rendered nugatory or pointless.”[38] However the burden of proof lies heavily upon any applicant to establish such a case. Mere assertion or speculation is not enough. The Applicant, in this instance, has not discharged that onus.

    [38] Australian College of Vocational Studies Pty Ltd v Australian Skills Quality Authority (General) [2018] AATA 1088 at [78].

  22. This matter was addressed by the Tribunal in Technical Education Australia[39] where Senior Member Cameron remarked:

    [125]  The Applicant contended that if it ultimately succeeded at the final hearing but in the interim suffered “irreparable damage” as a result of revocation of the interim stay order, the application for review would be nugatory. The justification for this contention was that the purpose of the final hearing is to grant relief to a successful applicant and therefore avoid irreparable damage flowing from the decision under review. This contention obviously presupposes that the Applicant would become insolvent in the interim or its reputation so damaged prior to the final hearing that it could not “effectively recover commercially”.

    [126]  The Tribunal has some difficulty with this approach for several reasons. Firstly, as noted previously, there is just insufficient evidence to conclude that the Applicant would become insolvent or its reputation would be so damaged. Apart from some bare assertions, there is no evidence that enables the Tribunal to reach a view one way or another, as to what if any, reputational damage might be suffered by the Applicant in the event that the stay order was revoked.

    [128]  Overall, given the limited evidence, the Tribunal cannot place much weight on this factor.

    [39] Technical Education Australia Pty Ltd and Australian Skills Quality Authority [2018] AT 3047.

  23. The Tribunal has already given consideration to this matter and does not need to elaborate further.

    OTHER RELEVANT MATTERS

  24. It is under this heading that the Tribunal turns to consider “the interests of any persons who may be affected by the review.”

  25. Clearly there are a number of parties who may be affected, including the parents of enrolled children, were the service to cease operations and members of its staff.

  26. There is some difficulty in establishing details about staff or educators employed. In Mr Gulleid’s affidavit of 27 November 2018 he claims that the Applicant had 61 educators, in his affidavit of 18 December 2018 that number has fallen to 43.[40] While the Respondent’s records show only 35 registered educators.[41]

    [40] Hibo Gulleid Affidavit (27 November 2018) at [32] and Affidavit (18 December 2018) at [32].

    [41] Respondent’s Submission in support of opposition to stay application at [74].

  27. Similarly the number of children enrolled is disputed, ranging from 337 to 217.[42] The Respondent notes that there is evidence that some 75 children have been able to move to other providers and that there are at least 28 other child care centres in the immediate vicinity of the Applicant’s Victorian operations in Truganina.[43]

    [42] Hibo Gulleid Affidavit (18 December 2018) at [36] and Respondent’s Submission in support of opposition to stay application at [76].

    [43] Respondent’s Submission in support of opposition to stay application at [75] and [73]

  28. Hardship to individuals and service providers is not to be treated as being exactly the same, and where reasonable alternatives are available for people who might be affected by decisions of the Tribunal, that should be taken into account.[44]

    [44] Samir Pty Ltd and Aged Care Standards and Accreditation Agency [2012] AATA 333.

  29. The Tribunal has made previous references to the protection of the public revenues and this must count as another relevant matter which it is legitimate to take into account. It forms, as do many such administrative decisions part of the fabric of good government in Australia.

  30. To quote again from this Tribunal’s own previous decision in Institute of Training:

    [70]  It is important to note that the Administrative Appeals Tribunal, apart from exercising jurisdiction under the relevant provisions of specific statutes, and not having a general jurisdiction across all Commonwealth administrative decisions, is part of an administrative law system which should be conducted by reference to the “standards of good government”.[45] It is an:

    instrument of government administration and designed to act where decisions have been made in the course of government administration but which are in the view of the Tribunal not acceptable when tested against the requirements of good government.[46]

    [71]  “Good government” includes both the protection of the public interest and protecting the integrity of the national vocational education system.[47]

    [45] Collector of Customs (NSW) v Brian Lawlor Automotie Pty Ltd (1979) 24 ALR 307 at [334] per Smithers J.

    [46] Ibid at [335].

    [47] Institute of Training Pty Ltd and Australian Skills Quality Authority [2018] AATA 4127.

  31. A similar degree of consideration applies to the system of child support benefits and the operations of the nationally regulated system of child care centres.

    CONCLUSION

  32. Consideration of all the matters placed before the Tribunal must be undertaken in the light of the express purpose of s. 41(2) of the AAT Act which is that stays should be granted essentially “for the purpose of securing the effectiveness of the hearing and determination of the application for review” and the legitimate interests of other parties “affected by the review”.

  33. The Tribunal is not persuaded that the granting of a stay in this instance is required in order to ensure that those express objectives are met. On the other hand it is persuaded that the Tribunal’s overall responsibility to promote “good government”, in this instance via protection of the public interest, weighs against a stay being granted.

    DECISION

  34. The application for a stay of the Department’s decision of 21 November 2018 is refused.

I certify that the preceding 77 (seventy -seven) paragraphs are a true copy of the reasons for the decision herein of Chris Puplick AM, Senior Member

............................[sgd]..........................................

Associate

Dated: 21 December 2018

Date(s) of hearing: 20 December 2018
Counsel for the Applicant: Mr N Bentley
Solicitors for the Respondent: Mr D Hertzberg, Department of Education and Training

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