Harb v Commissioner of Fair Trading

[2003] NSWADT 185

Pending Appeal:

CITATION:	Harb v Commissioner of Fair Trading [2003] NSWADT 185
DIVISION:	General Division
PARTIES:	FIRST APPLICANT Peter Harb SECOND APPLICANT Steven Harb RESPONDENT Commissioner of Fair Trading
FILE NUMBER:	023240
HEARING DATES:	11-12/06/2003
SUBMISSIONS CLOSED:	06/12/2003
DATE OF DECISION:	08/21/2003
BEFORE:	Molony P - Judicial Member
APPLICATION:	Home builder - cancellation of contractor licence - Home Builder - disqualification from holding authority - Home Building Act - home builder - cancellation of contractor licence - Home Building Act - home builder - disqualification form holding authority
MATTER FOR DECISION:	Principal
LEGISLATION CITED:	Administrative Decisions Tribunal Act 1997 Consumer, Trader and Tenancy Tribunal Act 2001 Evidence Act 1995 Home Building Act 1989 Interpretation Act 1987
CASES CITED:	Moore v Guardianship and Administration Board [1990] VR 902 Jones v Dunklel (1959) 101 CLR 298 Briginshaw v Briginshaw (1938) 60 CLR 366 Australian Concrete Services Pty Ltd v Multiplex Constructions [1999] NSWSC 1140 Eddy Lau Constructions Pty Ltd v. Transdevelopment Enterprise Pty Ltd & Anor [1999] NSWSC 455 The Ikranian Reefer [1993] 2 Lloyd’s Rep 68 Cala Homes (South) Ltd v Alfred McAlpine Homes East Ltd [1995] FSR 818 Lipovac v Hamilton Holdings Pty Ltd (Unreported, ACTSC, 13 September 1996) Hughes & Vale Pty Ltd v The State of New South Wales (No 2) (1955) 93 CLR 127 Kioussis -v- Director General, Department of Fair Trading [2002] NSWADT 2 Australian Broadcasting Tribunal -v- Bond and Ors (1990) 170 CLR 321 Director General, Department of Fair Trading v O’Connell (unreported, Fair Trading Tribunal, 8 November 2000, BU2000/3762) Clyne v NSW Bar Association (1960) 104 CLR 186
REPRESENTATION:	APPLICANT T Davie, barrister RESPONDENT T Grey, solicitor
ORDERS:	In Mr Peter Harb’s case the Tribunal:; a) affirms the decision of the Administrator to cancel Mr Peter Harb’s contractor licence;; b) sets aside the determination of the Administrator to disqualify Mr Peter Harb from obtaining a contractor licence for 5years and to impose a penalty of $4,000.00; and,; c) substitutes that determination with a decision that Mr Peter Harb be disqualified from holding a contractor licence for a period of 3 years.; In Mr Steven Harb’s case, the Tribunal sets aside the determination of the Administrator and substitutes that decision with a finding that Mr Steven Harb is guilty of improper conduct within the meaning of s,51(2)(c) of the Act, and determines that he:; a) is to be reprimanded for that improper conduct; and; b) is to pay a penalty of $1,650.00 to the Administrator.

REASONS FOR DECISION

Background

1 Mr Peter Harb and Mr Steven Harb both hold a contractor licence under the Home Building Act 1989 (‘the Act’). On 12 August 2002, the Director-General of the Department of Fair Trading, now the Commissioner for Fair Trading (‘the Administrator’), issued show cause notices under s.61 of the Act directed to Mr Peter Harb and Mr Steven Harb. The notices contained information relating to their alleged conduct, and invited them to make submissions as to why disciplinary action should not be taken against them. On 22 August 2002, Mr Peter Harb and Mr Steven Harb, via their solicitors, responded to the show cause notices and made submissions that they should be reprimanded for those parts of the alleged conduct they admitted to. They denied other aspects of the alleged conduct.

2 On 11 October 2002, the Administrator pursuant to s.62 of the Act determined to cancel Mr Peter Harb’s contractor licence and to disqualify him from holding any authority under the Act for a period of five years from 23 October 2002. A penalty of $5,000.00 was also imposed. With respect to Mr Steven Harb, the Administrator was satisfied that only one of the allegations specified in the show cause notice was made out, that Mr Steven Harb had failed to comply with orders made by the Consumer Trader and Tenancy Tribunal. The Administrator determined to cancel his contractor licence and disqualify him for a period of two years from that date. The Administrator gave notice of those decisions together with reasons for decision as required by s.64 of the Act.

3 On 22 October 2002, Mr Peter Harb and Mr Steven Harb lodged an application for review of the Administrator’s decision with the Tribunal, together with an application for an urgent stay of the decision. At the same time, they sought an internal review of the Administrator’s decision, and made further submissions in support of that request. On 25 October 2002, the Tribunal stayed the decision of the Administrator on agreed conditions.

4 On 23 December 2002, Mr Peter Harb and Mr Steven Harb were given notice that the Administrator’s decision had been affirmed on internal review. The stay order made by the Tribunal on 25 October 2002 has remained in place since then.

5 The Tribunal heard Mr Peter Harb’s and Mr Steven Harb’s appeals against the Administrator’s decision to cancel each contractor licence and disqualify them on 11 and 12 June 2003. At the conclusion of that hearing the Tribunal reserved its decisions, and directed that the stay order continue to operate pending the Tribunal’s delivery of its decision. These are the Tribunal’s reasons for decision in respect to those appeals.

6 The decisions under review stem from events surrounding renovation works undertaken at 29 Harris Street, Balmain for a Mr and Mrs Daniels. The work involved an upper story addition to house (‘the works’). It is agreed that the work was in fact done by Mr Peter Harb, and that Mr Steven Harb’s association, if any, is as a partner in the business, ‘Harb Constructions’ which the Administrator maintains was the contracting party with Mr and Mrs Daniels with respect to that work.

Legislation

7 The Home Building Act 1989 makes provision for the regulation of residential building work and specialist work. Part of this regulative scheme is the provision of licences and certificates to do such work. S.4 of the Act provides that a person is prohibited from contracting to do residential building work or specialist work on behalf of an individual, partnership or corporation unless that person is the holder of a licence authorising that person to contract to do that work.

8 S.56 specifies the grounds upon which the Administrator may take disciplinary action against the holder of a contractor licence. Relevantly it provides:

The Director-General may take disciplinary action under section 62 against the holder of a contractor licence on any of the following grounds:
(a) that the holder is not entitled to hold the contractor licence,

(b) that the holder is not fit to hold the contractor licence,

(c) that the holder is guilty of improper conduct,

(d) …

(e) in the case of a holder of a contractor licence that is a partnership--that any of the members of the partnership, or any of the officers of a corporation that is a member of the partnership, is not a fit and proper person to be a member of the partnership or an officer of the corporation or has been guilty of improper conduct,

(f)…

9 S.51 makes provision regarding improper conduct generally. Relevantly it provides:
(1) A holder of a licence who is authorised by the licence to contract to do residential building work or specialist work, or a holder of a supervisor or tradesperson certificate, is guilty of improper conduct if the holder:
(a) commits an offence against this Act or the regulations, whether or not an information has been laid for the offence, or

(b) in the course of doing any work that the licence or certificate authorises the holder to do, fails to comply with the requirements applicable to the work made by or under this or any other Act in respect of the work, or

(c) breaches a statutory warranty, or

(d) in the case of specialist work, does the work otherwise than in a good and workmanlike manner or knowingly uses faulty or unsuitable materials in the course of doing the work.

(1A) …

(2) The holder of a licence is guilty of improper conduct if the holder:

(a) without reasonable cause, breaches a contract to do any work that the licence authorises the holder to contract to do, or

(b)

(c) does not comply with an order of the Tribunal, or

(d)

(e) commits fraud or makes any misrepresentation in connection with any contract authorised by the licence or any contract for the sale of any dwelling, structure or work that has resulted from, or been affected by, any work done under the authority of the licence, or

(f) is convicted of any offence under the Workers Compensation Act 1987 or the Workplace Injury Management and Workers Compensation Act 1998 or any regulations made under either of those Acts.

(3) It is a sufficient defence to a complaint that the holder of a licence has been guilty of improper conduct as referred to in subsection (1) (b), (c) or (d) in connection with work undertaken by the holder, if the holder proves to the satisfaction of the Director-General that the holder did all that could reasonably be required to ensure that a nominated supervisor for that work would exercise such degree of control over the doing of the work as would be necessary to prevent the occurrence of the improper conduct.
10 S.61 provides for the issue of a show cause notice by the Administrator, where ‘there are reasonable grounds for believing that there are grounds for taking disciplinary action’, and for the holder of a contractor licence to make submissions in response. S.62 specifies the Administrator’s powers when satisfied that there are grounds to take disciplinary action:
If, after compliance with this Division, the Director-General is satisfied that any ground on which disciplinary action may be taken against the holder of an authority has been established in relation to the holder, the Director-General may do any one or more of the following:
(a) determine to take no further action against the holder,

(b) caution or reprimand the holder,

(c) make a determination requiring the holder to pay to the Director-General, as a penalty, an amount not exceeding $11,000 (in the case of an individual) or $22,000 (in the case of a corporation) within a specified time,

(d) vary the authority held by the holder, by imposing a condition on the authority, including a condition requiring the holder to undertake a course of training relating to a particular type of work or business practice within a specified time,

(e) suspend the authority for a period not exceeding its unexpired term,

(f) cancel the authority,

(g) disqualify the holder, either temporarily or permanently, from being any one or more of the following:

(i) the holder of any authority, or any specified kind of authority,

(ii) a member of a partnership, or an officer of a corporation that is a member of a partnership, that is the holder of an authority,

(iii) an officer of a corporation that is the holder of an authority.

11 S.83B(3) of the Act provides for a right of review of decisions made by the Administrator under s.62 to the Tribunal:
(3) A person aggrieved:
(a) by a decision made by the Director-General under Part 4 (Disciplinary proceedings) to impose a penalty or to cancel or suspend a contractor licence, or

(b) by any other decision made by the Director-General under that Part that is prescribed by the regulations,

may apply to the Tribunal for a review of that decision.
Regulation 58A(3) of the Home Building Regulation 1997 (‘the Regulation’) prescribes a decision to disqualify a person from obtaining a contractor’s licence, as a decision to which s.83B(3)(b) applies. These provisions combine with s.38 of the Administrative Decisions Tribunal Act 1997 ( ADTA ) to give the Tribunal jurisdiction to review the Administrator’s decisions.

12 It is the Tribunal’s task in determining the review to make the correct and preferable decision. S.63 ADTA provides:
(1) In determining an application for a review of a reviewable decision, the Tribunal is to decide what the correct and preferable decision is having regard to the material then before it, including the following:
(a) any relevant factual material,

(b) any applicable written or unwritten law.

(2) For this purpose, the Tribunal may exercise all of the functions that are conferred or imposed by any relevant enactment on the administrator who made the decision.

(3) In determining an application for the review of a reviewable decision, the Tribunal may decide:

(a) to affirm the reviewable decision, or

(b) to vary the reviewable decision, or

(c) to set aside the reviewable decision and make a decision in substitution for the reviewable decision it set aside, or

(d) to set aside the reviewable decision and remit the matter for reconsideration by the administrator in accordance with any directions or recommendations of the Tribunal.

Material Before The Tribunal

13 The evidence tendered by the Applicants to the Tribunal consisted of a bundle of documents (Exhibit 1).

14 The documentary and physical evidence tendered by the Respondent to the Tribunal consisted of the following exhibits:

A Pages 61 to 310 of the Administrator’s material that consist of the show cause notice dated 12 August 2002 addressed to Mr Peter Harb (‘the show cause notice to Mr Peter Harb’);

B Pages 51 to 60 of the Administrator’s material that consist of the show cause notice dated 12 August 2002 addressed to Mr Steven Harb (‘the show cause notice to Mr Steven Harb’);

C Pages 49 to 50 of the Administrator’s material that consist of a letter dated 22 August 2002 from the Applicants’ solicitor to the Administrator;

D Pages 34 to 48 of the Administrator’s material that consist of the notice of decision under s.64 of the Act dated 11 October 2002 and reasons for that decision addressed to Mr Peter Harb;

E Pages 20 to 47 of the Administrator’s material that consist of the notice of decision under s.64 of the Act dated 11 October 2002 and reasons for that decision addressed to Mr Steven Harb;

F Pages 10 to 19 of the Administrator’s material which consist of a undated letter requesting an internal review and submissions from the Applicants’ solicitor to the Administrator;

G Pages 2 to 10 of the Administrator’s material which consist of the decision on internal review;

H A statement from Mrs Gale Daniels with annexures A to G; and,

I A piece of timber produced under summons by the Consumer Trader and Tenancy Tribunal.

15 Objection was taken by the Applicants’ Counsel to various parts of the show cause notice to Mr Peter Harb, which resulted in me refusing to admit various parts of that volume as evidence of the truth of their contents. I will briefly describe the material excluded and the reasons why it was excluded.
Pages 71 to 103 are an investigators’ report prepared by Mr Mark Tuckwell. It is a curious document consisting of an amalgam of:
a recitation of complaints made by Mrs Daniels to Mr Tuckwell concerning the works and of her version of events as told to him;

a summary of licence details relating to Mr Peter Harb and Mr Steven Harb;

a summary of details of the contract for the works;

a recitation of some defects found in the works by building inspectors other than Mr Tuckwell;

recitations of statements and admissions made by Mr Peter Harb and Mr Steven Harb to Mr Tuckwell during an on site inspection/interview;

expert opinion from Mr Tuckwell concerning the nature and quality of the works;

photographs of the works;

assertions of evidence given to the Consumer Trader and Tenancy Tribunal when hearing a home building claim made by Mrs Daniels;

conclusions of fact and law reached by Mr Tuckwell concerning the conduct of Mr Peter Harb and Mr Steven Harb;

recommendations for disciplinary action made by Mr Tuckwell.

Mr Davie submitted the document contained a mixture of hearsay, submissions, unqualified and expert opinion that was inadmissible, and asked me to exclude it in its entirety. I accepted Mr Davie’s criticism of the document and agree with him that ‘it is not anywhere approaching a rigorous document’. The Tribunal, however, is not bound by the rules of evidence (s.73(2) ADTA ), although it is guided by the rules of evidence in assessing admissibility and weight. I determined to admit the report into evidence on the basis that it formed part of the show cause notice. I indicated to Mr Grey, for the Respondent, that I was not accepting the document as proof of its contents, and that matters of hearsay, which could otherwise be reasonably proved by the best evidence, and submissions or unqualified opinion evidence would be given no weight.

Pages 152 to 155 which consist of part of a report prepared by BCM Consultants and was excluded insofar as it contained matters of hearsay which could otherwise be reasonably proved by the best evidence from Mrs Daniels, who had provided a statement in the proceeding. The photographic record of defects referred to in those pages remained in evidence (pages 170 to 210);

Pages 160 to 163 which consist of a chronology purporting to have been prepared by Mrs Daniels, but which was not referred to or verified in her statement, when it could have been. This was admitted into evidence on the basis that it formed part of the show cause notice, but not as proof of its contents, because it was not clear that it was Mrs Daniel’s document and could have simply been proved as her document as she had made a statement in the proceedings.

The same fate befell pages 164 to 167 that are headed ‘List of Items to Be Corrected’. It is not clear whose document this is or what qualifications the author has to express the opinions there set out.

Pages 211 to 219 consist of quotes for the alleged cost of rectifying defective works, and a summary of those quotes. Pages 234 to 237, 239 to 243, and 255-262 are further quotes, time sheets and summaries, for the alleged cost of rectifying defective works. These were admitted into evidence on the basis that they formed part of the show cause notice, but not as proof of their contents, because the costs of rectification had been the subject of findings by the Consumer Trader and Tenancy Tribunal. There was agreement that the decision on the cost of rectification by the Consumer Trader and Tenancy Tribunal constituted the best evidence of the cost of rectification.

Pages 231 and 233 which consist of unsigned copy letters dated 1 May 2001 and 27 August 2001, purportedly from Mrs Daniels to the Applicants’ solicitor and HIA Insurance respectively, but which were not referred to or verified in her statement, when they could have been. These also were admitted into evidence on the basis that they formed part of the show cause notice, but not as proof of their contents, because it was not clear that they were Mrs Daniel’s documents and they could simply have been proved as her documents.

Pages 299 to 300, which consist of copy emails passing between Mr Tuckwell and a Kim Jones. Mr Grey did not seek to rely on these documents as proof of their contents, so they were admitted into evidence on basis that they formed part of the show cause notice only.

Pages 300 to 303, which consist of photographs of a piece of timber sent by Mr Peter Harb to the Consumer Trader and Tenancy Tribunal. These were admitted into evidence on the basis that they formed part of the show cause notice, but not as otherwise as the piece of timber itself was before the Tribunal.

Other Evidentiary Matters

16 Because it is convenient to discuss and make findings concerning the various matters alleged against the Applicants separately, mention should be made of a number of evidential submissions and decisions affecting the oral evidence given to the Tribunal. These impact on the discussion of various allegations.

17 The Tribunal heard evidence from Mr Mark Tuckwell an investigator with the Office of Fair Trading, and Mr Charles Herbert the Chief Timber Inspector from State Forests. Both were called by the Respondent. Neither Applicant gave evidence to the Tribunal.

18 An issue arose with respect to the evidence of both Mr Tuckwell and Mr Herbert, which impacted on the proceedings and requires explanation. It was alleged by the Respondent that Mr Peter Harb made a false statutory declaration when he submitted to the Consumer Trader and Tenancy Tribunal, the piece of timber accompanied by a statutory declaration in which he said that the timber was a remnant from the timber used at the works, “for the installation of a new timber floor as brushbox timber”. The Respondent issued a summons seeking production of the timber from the Consumer Trader and Tenancy Tribunal. For reasons that are unclear there was a delay in production, and it was only produced on the morning the hearing before the Tribunal commenced.

19 As a consequence, the Applicants’ experts were unable to examine the timber before the hearing and compare it with the timber floor at the works. Mr Davie, while not wishing to delay the proceedings, sought the opportunity to have an expert inspect the timber and compare it with the timber floor at the works. The Respondent was intending to call expert evidence that the timber at the site and that produced to the Consumer Trader and Tenancy Tribunal were not the same. Mr Grey indicated that he was not sure whether Mrs Daniels would agree to such an inspection by the Applicants’ experts. I indicated to Mr Grey that I considered that, given the seriousness of the allegation made against Mr Peter Harb, the interests of justice and fairness required that he be given the opportunity to properly test the Respondent’s allegations that the timber was not the same as that at the works. The way to do this was to obtain appropriate expert opinion. If necessary, the hearing would be adjourned to enable this to occur. I asked Mr Grey to convey this view to Mrs Daniels.

20 Mr Grey did so, and later informed the Tribunal that Mrs Daniels was not prepared to allow the Applicant’s expert access to her property. He said that she told him that she has had enough of the troubles associated with the works.

21 That being the case Mr Davie submitted that it would be unfair, and highly prejudicial, to the Applicants to allow the Respondent to lead evidence comparing the piece of timber to that laid in the timber floors at the works. This was so because the Applicants had been deprived of the opportunity to challenge such evidence. I agreed with this submission, and indicated that because I could see no means of ameliorating the disadvantage suffered by Mr Peter Harb, I would not allow the Respondent to lead evidence comparing the piece of timber to that laid in the timber floors.

22 S.135 of the Evidence Act 1995 provides:

The court may refuse to admit evidence if its probative value is substantially outweighed by the danger that the evidence might:
(a) be unfairly prejudicial to a party, or

…

As Mr Peter Harb would be effectively deprived of the ability to challenge the Respondent’s expert evidence, I considered that I would be able to attach little or no weight to it, in the interest of fairness. Its prejudicial nature would, however, be substantial, especially going to the credit of Mr Peter Harb. I concluded that the prejudicial effect of the evidence would outweigh its probative value, and determined that the interests of fairness required that I exclude it. In reaching this conclusion I bore in mind the dangers inherent in a Tribunal determining an issue on the basis of evidence which is of little probative value, but substantial prejudicial effect, Moore v Guardianship and Administration Board [1990] VR 902, and the injunction in s.73(2) and (3) ADTA that while the Tribunal is not bound by the rules of evidence, it is bound by the rules of natural justice and is to act ‘according to equity, good conscience and the substantial merits’ of the case. In the particular circumstances of this case, I determined that it was appropriate to apply the rules of evidence and excluded the evidence sought to be adduced pursuant to s.135 of the Evidence Act 1995.

23 The other evidentiary issue arising from the oral evidence was Mr Grey’s submission that I should draw the strongest possible inference from the Applicants’ failure to give evidence. That inference, he said, was that there was “no satisfactory explanation” which could be offered by the Applicants “to the allegations as framed.” Mr Davie submitted that the inference, which could be drawn was that, the Applicants’ evidence would not have been of assistance to their case. I accept Mr Davie’s submission: Jones v Dunkel (1959) 101 CLR 298.

24 Finally, it should be noted that both parties were in agreement that the appropriate standard of proof to be applied with in the proceeding was that laid out in Briginshaw v Briginshaw (1938) 60 CLR 366.

The Allegations Leading to the Decision with respect to Mr Peter Harb

25 It is convenient to deal with the various allegations made against Mr Peter Harb that were found to be sustained by the Administrator first, and then with the single allegation found sustained against both Mr Peter Harb and Mr Steven Harb.

A Failing to Notify a Change of Particulars With Respect to a Business Name

26 Relevantly, clause 23 of the Regulation provides:

The holder of a contractor licence must notify the Director-General in writing of the following particulars within 7 days of the specified events occurring and must provide any specified documents:

Business names

(a) …

(b) if the holder notifies the Director-General of any change of particulars relating to a registered business name under which the holder carries on business or ceases to trade under such a name or if the registration of such a name expires and is not renewed—the date of notification of the change and the details notified, the date of ceasing to trade under that name and the date of expiry of the registration,

…

Mr Peter Harb is the holder of a contractor licence. He was jointly registered with Mr Steven Harb as the persons carrying on business under the registered business name, ‘Harb Construction’. The business names extract produced by the Respondent shows that the business was, “REMOVED on 27 March 2002.” The Administrator was not notified of this.

27 The Administrator found that Mr Peter Harb was in breach of clause 23 by failing to notify the Administrator, “of a change of particulars in respect of carrying on business under a trading name”. Mr Davie submitted that clause 23 is ambiguous, and said that he did not understand it. I have some sympathy for that view. On a literal reading of the clause it seems that for sub clause (b) to operate, it requires that licence holder first notify the Administrator of a change of particulars. This gives rise to an argument that as the Applicants had given no particulars to the Administrator there was no obligation under clause 23. It is clear that in construing the clause the Tribunal should attempt to give effect to the legislative intention underlying the clause and promote the purpose and object underlying the Regulation: s.33 Interpretation Act.1987. I have come to the conclusion that the clause can be construed as requiring a licence holder to notify the Administrator in writing within 7 days of the particulars relating to a registered business name under which the holder carries on business or ceases to trade under such a name, or if the registration of such a name expires and is not renewed. This appears to me to be consistent with the purpose and object of the Regulation

28 On balance I am satisfied that the Mr Peter Harb failed to comply with clause 23 of the Regulation, and as such is guilty of improper conduct for the purposes of s.62 of the Act.

B Misrepresenting that Harb Constructions Held a Licence

29 S.17 of the Act provides that:

(1) A person must not represent that an individual, a partnership or a corporation:
(a) is the holder of a licence, knowing that the individual, partnership or corporation is not the holder of a licence, or

(b) …

Maximum penalty: 200 penalty units.

(2) …

(3) For the purposes of this section, a licence or certificate is appropriate only if it authorises its holder to contract to do, or authorises its holder to do, the work that is the subject of the representation.

30 The Administrator found that Mr Peter Harb had misrepresented that Harb Constructions, a partnership, was the holder of a contractor licence. It is not disputed that Mr Peter Harb prepared a quote for the works for Mr and Mrs Daniels dated 5 November 2000. The quote is on Harb Construction letterhead which looks like this: (text version follows)
[This is a text version of the graphic:

132

Harb Construction

Builders lic. No. 65651C

Quality New Homes, Extensions & Renovations, Residential & Commercial

Office: 35 Wisdom Street, Guildford N.S.W 2161 Tel/Fax: [phone] Mobile: [phone]]

The quote was signed by Mr Peter Harb. The licence number on the letterhead is that of Mr Peter Harb, not of Harb Construction. Similarly, it is not disputed that the contract dated 12 December 2000 with respect to the works shows the name of the builder as, “Peter Harb / Harb Construction” and the builder’s licence number as 65651C. Again this is Mr Peter Harb’s licence number.

31 Mr Grey submitted that by using his licence number on the quote and the contract, Mr Peter Harb had represented that Harb Construction was the holder of licence number 65651C, knowing that was not the case. Mr Davie submitted that Mr Peter Harb’s conduct reflected a lack of knowledge of the precise legal requirements attaching to partnerships, and that, in any case, there is a legal difficulty with the proposition that a licence can attach to a partnership.

32 That last proposition is irrelevant to a determination of whether a licence holder has knowingly represented that a partnership holds a licence, when it does not do so. The evidence satisfies me that Mr Peter Harb, by displaying his own licence on Harb Construction letterhead, represented that Harb Construction, a partnership, held that licence. The fact that he used his own licence number, is evidence that he made that representation knowing that Harb Construction was not the holder of that licence. Further, his failure to give evidence enables me to infer that his evidence would not have assisted him with respect to the issue of his knowledge, when that representation was made. I am therefore satisfied that Mr Peter Harb, in breach of s.23(a) of the Act, knowingly represented that Harb Construction, a partnership, held a licence, when it did not do so. As such Mr Peter Harb is guilty of improper conduct for the purposes of s.62 of the Act.

33 I am not similarly satisfied with respect to the contract, as it is not at all clear from the contract whether the licence number disclosed is being attributed to Mr Peter Harb or Harb Construction. It is capable of being read either way, and does not support a finding against Mr Peter Harb.

C Doing Residential Building Work Without Insurance

34 S.92 of the Act, as it was at the time of the contract, relevantly provided:

(1) A person must not do residential building work under a contract unless:
(a) a contract of insurance that complies with this Act is in force in relation to that work, and

(b) a certificate of insurance evidencing the contract of insurance, in a form prescribed by the regulations, has been provided to the other party (or one of the other parties) to the contract.

Maximum penalty: 100 penalty units.

(2) A person must not demand or receive a payment under a contract for residential building work (whether as a deposit or other payment and whether or not work under the contract has commenced) from any other party to the contract unless:
(a) a contract of insurance that complies with this Act is in force in relation to that work, and

(b) a certificate of insurance evidencing the contract of insurance, in a form prescribed by the regulations, has been provided to the other party (or one of the other parties) to the contract.

Maximum penalty: 100 penalty units.

(3) This section does not apply if the contract price does not exceed $5,000 or (if the contract price is not known) the reasonable market cost of the labour and materials involved does not exceed $5,000.

(4) …

(6) To avoid doubt, this section extends to residential building work that is also owner-builder work.

35 The contract price for the works was $44,000, and Home Warranty insurance was therefore required. Schedule 4 of the contract deals with warranty insurance. It has not been properly completed. The only thing written in Schedule 4 are the words, “HOW to owners address and details.” There is no dispute that an insurance policy as required by the Act was not in force when Mr Peter Harb undertook the works. No certificate of insurance was given by Mr Peter Harb to Mr and Mrs Daniels, or vice versa .

36 The Administrator found that Mr Peter Harb was guilty of misconduct as a result of the failure to provide home warranty insurance for the work carried out. When it heard the home building claim made by Mr and Mrs Daniels against Harb Constructions, the Consumer Trader and Tenancy Tribunal found that no insurance had been effected and did not allow Harb Constructions to claim money owing to it as a consequence. I should add that it is clear that the finding of the Consumer Trader and Tenancy Tribunal is not per se admissible of evidence of those facts, and I do not take it as such evidence: s.91 Evidence Act 1995.

37 In his evidence Mr Tuckwell gave evidence of an on site interview which took place on 18 April 2002. He said that the notes of this interview were taken on a document he had prepared in preparation for the interview. The notes (at pages 265 to 278) were in fact written by a colleague of Mr Tuckwell, Mr Paul Dengate, as they made their way around the site during the interview. Present according to the notes were Mr Tuckwell, Mr Peter Harb, Mr Dengate and Mr Peter Martin a building consultant. The notes were signed by those recorded as present at the conclusion of the interview. In his evidence Mr Tuckwell said that Mr Steven Harb was also present, although there is no mention of this in the notes. During the course of this roving interview Mr Peter Harb was asked about Home Warranty Insurance. The notes of his reply read:

There is none.

Cautioned again.

Peter said he would rather not talk about it.

It can be seen that this is not a word for word transcript of what was said. I have grave concerns about the process involved in taking these notes. and their accuracy.

38 In the course of his evidence, Mr Tuckwell was cross-examined about his understanding of the requirements for Home Warranty Insurance. He said that the Regulation required that the builder have insurance. When asked to identify where this requirement could be found at the time of the contract, he was unable to do so. No such provision existed. The purpose of this cross-examination was to highlight the difficulties that exist with understanding the insurance requirements relating to home building, which have changed frequently in recent years.

39 In their submissions dated 22 August 2002 the Applicants’ solicitors wrote:

Our clients admit they failed to effect home warranty insurance on the work or rather the company contracting did not obtain such insurance. The reason was that the clients were misled by the other contracting party who indicated that she had arranged her own insurance and in fact we understand that there was in fact home owners insurance taken out by the owner as an owner-builder in respect of the approval in relation to which our clients' undertook work. Our clients have been sufficiently prejudiced in that they cannot recover the balance of the contract price as a result.

In her statement Mrs Daniels said at paragraph 9 that:

I paid a deposit of $2,200 on the date of signing the contract and work began on the 15th January 2001. I did not receive a copy of a Certificate of Insurance in respect of Home Warranty Insurance prior to the work commencing. Later, on 27 April 2001, I wrote to Peter Harb requesting the Home Warranty Insurance policy be provided to me. A copy of this letter is at page 226 of the Bundle. I did not receive a reply to this letter.

40 Mr Davie submitted that there was no obligation cast on a licence holder by s.92 at the time of the contract to effect Home Warranty insurance. He referred to Australian Concrete Services Pty Ltd v Multiplex Constructions [1999] NSWSC 1140. There the Court was concerned with the right of a sub-contractor to recover from a head contractor for work done, where the sub-contractor did not have in place a home warranty insurance policy. Hunter J said with respect to s.92 that:
35. … That section prohibits a person from contracting to do any residential building work "unless a contract of insurance that complies with [the] Act is in force in relation to the proposed work " (emphasis added). S 92(1) does not say that the contract of insurance is one that is required of the sub-contractor under a head contract where the head contractor is obliged to insure under s 92. All that is required is that there be a contract of insurance in force in relation to the work. That requirement is satisfied by the head contractor's contract of insurance. That construction has to be read in conjunction with s 92(2). I think the latter subsection is satisfied in the last mentioned situation where the head contractor's certificate of insurance is attached to the sub-contract. That construction, in my view, is also consistent with the obligation of a sub-contractor, who is engaged in the performance of residential building work, to hold a licence under the Act .

…

38 Expressed shortly, the s 92 requirement is to have in place a contract of insurance which complies with the Act in relation to the proposed work. It is silent as to the manner in which that insurance is put in place. Hence, the requirement in relation to sub-contract works is satisfied by there being in place the requisite contract of insurance in relation to the head contract works. Although not germane to my construction of s 92, that construction is underscored by cl 41 of the Regulation under the Act which is in the following terms:

"41 Persons who may arrange insurance contracts

An insurance contract may be entered into for the purposes of Part 6 of the Act by a contractor or supplier, or by a beneficiary in respect of the work done or kit home supplied, and may be arranged by any such person."

39 … As I read s 92 the obligation is cast upon a party contracting to perform residential building work, whether as head contractor or sub-contractor, to ensure that there is in place a contract of insurance, "in force in relation to the proposed work".
41 When Mr Peter Harb entered into the contract with Mr and Mrs Daniels clause 41 of the Regulation was still in the same form as that referred to in Australian Concrete Services Pty Ltd v Multiplex Constructions . Mr Davie also referred me to Eddy Lau Constructions Pty Ltd v. Transdevelopment Enterprise Pty Ltd & Anor. [1999] NSWSC 455, an interlocutory decision of Brownie AJ concerning a contract to which a certificate of insurance had not been annexed, as was then required by the Act. I found this case of no assistance in the present circumstances. The central tenet of Mr Davie’s submission was that as the contract did not make clear whose obligation it was to effect the insurance, and as the Regulation did not specifically place this burden on the licence holder, I could not be satisfied that Mr Peter Harb had the contractual responsibility to affect the required insurance. I accept that this is the case.

42 S.92, however, prohibits a person from doing residential building work under a contract unless a contract of insurance is in force in relation to that work, and a certificate of insurance has been provided by one party to the other. Even accepting Mr Peter Harb’s view that Mr and Mrs Daniels were to obtain the contract of insurance (as advanced in the submissions of 22 August 2002), it is clear that he breached s.92(1) by proceeding to do the work without requiring them to provide him with a certificate of insurance. Similarly, he was in breach of s.92(2) by accepting a payment under the contract without requiring them to provide him with a certificate of insurance. As such Mr Peter Harb is guilty of improper conduct for the purposes of s.62 of the Act.

D Installing Timber Flooring Other than Agreed

43 It was alleged in the show cause notices and it appears that the Administrator found that it was a verbal term of the contract between Harb Constructions and Mr and Mrs Daniels that timber flooring in the extension would be of brushbox. Mr Davie submitted that there was no evidence of such a term.

44 I have looked carefully at the contract and attached specifications and can find no requirement there that the flooring be constructed from brushbox. There is no mention in Mrs Daniels’ statement of any such condition. Indeed, I can only find two references in the materials before the Tribunal to the existence of such a condition. The first is an assertion in the investigators report (at page 81) that there was a verbal condition. There is no basis disclosed for this assertion and, as indicated above, I give it no weight. The second reference is in the reasons for decision from the Consumer Trader and Tenancy Tribunal (part of Exhibit 1 tendered by the Applicants). Both Mr Peter Harb and Mr Steven Harb gave evidence before the Tribunal. In those proceedings they were the Respondents. In paragraph 22 under the heading ‘The Respondent’s Case’ the Member wrote:

22 In respect of brushbox flooring, the Respondents' evidence is that they ordered brushbox from the suppliers as was required by the specification. They received the timber and laid it. They submitted that there is a wide range of colour differentiation from one timber to the next, this dependent on batches, source etc. It is not appropriate to refuse material supplied to a site, unless that supplied is of an appreciable and obvious distinction to that required. This was not the case on this project, and the material was accepted in good faith, as brushbox.
45 In my opinion this is clear evidence of an admission by Mr Peter Harb and Mr Steven Harb with respect to the issue of whether or not brushbox was specified. Given the nature of the document in which the admission is recorded, the reasons for decision of a Tribunal, and the undesirability of calling the Member before whom the evidence was given, it is my view that I should consider this as probative. The reasons for decision are signed by the Member and are a document I am required to take judicial notice of: s.76 Consumer, Trader and Tenancy Tribunal Act 2001 . When combined with the inference I am able to draw because Mr Peter Harb chose not to give evidence to the Tribunal, that his evidence would not have assisted his case that there was no verbal term that the floor would be constructed of brushwood, it is more than sufficient to persuade me that brushwood floors were specified.

46 There was evidence from Mr Herbert in his report 24 September 2002 that he had inspected the flooring and that it is not of brushbox. Mr Herbert’s expertise was not challenged. I accept that expert opinion.

47 I am therefore satisfied that Mr Peter Harb failed to do work which he was obliged to do under the contract, i.e. supply and lay brushwood floors. The explanation given to the Consumer Trader and Tenancy Tribunal does not explain why he proceeded to lay it, and there is no evidence of any other reasonable cause for him doing. Because Mr Peter Harb chose not to give evidence to the Tribunal, I am entitled to infer that his evidence would not have assisted his case in this regard. In the light of the evidence I am satisfied that, without reasonable excuse, Mr Peter Harb failed to do work which he was obliged to do under the contract. As such Mr Peter Harb is guilty of improper conduct for the purposes of s.62 of the Act.

E Not Carrying Outwork in a Proper and Workmanlike Manner

48 It was alleged that Mr Peter Harb had not undertaken the renovations in a proper and workmanlike manner in that:

a) there were excessive gaps in the timber flooring;

b) roof sheeting which was inadequately fixed;

c) there was a gap at the junction of the pitched roof beside the balcony and the flat roof at the rear of the property;

d) there is insufficient overlap of the gutters by the roof sheeting;

e) that the roof flashing on the south side provided in adequate cover;

f) the barge capping above the rear balcony has not been installed parallel to the barge board, and is unsightly;

h) the downpipe offset at the rear of the extension, falls the wrong way, leading to pooling;

i) a downpipe has been fitted to an existing gutter in an unsightly fashion which limits the flow of storm water;

j) the facia to the first floor addition has been damaged by hammer blows;

k) different timber moulding (one square, one quadrant) have been used together above the balcony, which is unsightly; and

l) the bi-fold doors to bedroom three have been hung significantly out of alignment.

49 Mr Tuckwell gave expert evidence of these defects. His evidence was challenged by Mr Davie, who conceded that there were minor defects in the works. The challenge to Mr Tuckwell was not on the basis of his qualifications to give such evidence, but on the basis that his evidence was not the balanced evidence of an impartial expert, but was the evidence of a partial investigator seeking to bring as strong a case as possible against Mr Peter Harb. Accordingly, Mr Davie submitted, I should give his evidence no weight.

50 Mr Davie asked Mr Tuckwell what his obligations were when giving expert evidence. Mr Tuckwell replied that he was to give evidence on his report and added, that given his experience in the building industry, he is “regarded as an expert”. Mr Tuckwell agreed that he:

a) had lengthy consultations with Mrs Daniels;

b) had consultations with other experts retained by Mrs Daniels;

c) had conducted research into matters of fact and law supporting her allegations;

d) had conducted the on site interview with Mr Peter Harb; and

e) had prepared the investigators report in which he laid out the case against the Applicants and recommended that show cause notices issue.

51 In his submission, Mr Grey addressed this challenge on the “impartiality of the inspector”. He noted that Mr Tuckwell had not recommended disciplinary action against Mr Peter Harb with respect to all the matters he questioned him about at the on site interview, and that were the subject of complaint. Mr Grey said that this showed that Mr Tuckwell had exercised some judgement and made considered decisions.

52 In The Ikranian Reefer [1993] 2 Lloyd’s Rep 68 Cresswell J said at 81-2 that:

An expert witness should provide independent assistance to the Court by way of objective unbiased opinion in relation to matters within his expertise… An expert … should never assume the role of advocate.
In Cala Homes (South) Ltd v Alfred McAlpine Homes East Ltd [1995] FSR 818 Laddie J observed at 843:
Of course the court will be aware that a party is likely to choose as its expert someone whose view is most sympathetic to its position. Subject to that caveat, the court is likely to assume that the expert witness is more interested in being honest and right than in ensuring that one side or another wins. An expert should not consider that it is his job to stand shoulder to shoulder through thick and thin with the side which is paying his bill.
While the Tribunal is not bound by the rules of evidence, it is my view that that the requirement that expert evidence be independent, objective and unbiased is one the Tribunal should uphold in interest of fairness and in the pursuit of equity, good conscience and in ensuring that its decisions are made on the substantial merits of a case: s.73(3) ADTA. It has been observed that, “…the rules relating to expert evidence at common law are largely based on good sense”: Lipovac v Hamilton Holdings Pty Ltd (Unreported, ACTSC, 13 September 1996 per Higgins J at paragraph 532). The requirement that expert evidence be independent, objective and unbiased is one such example, especially when the expert evidence goes to the heart of the issues in dispute.
53 When one considers the role Mr Tuckwell has played in this matter, which, on his own evidence, includes:
a) extensive discussions with Mrs Daniels;

b) discussions with experts retained by Mrs Daniels;

c) the conduct of a formal on site interview with Mr Peter Harb (at which Mr Peter Harb was cautioned);

d) obtaining other materials relevant to the various allegation made against Mr Peter Harb; and

e) the preparation of the investigator’s report that included his recommendation that disciplinary action to be taken against Mr Peter Harb,

it is clear that Mr Tuckwell is not a disinterested, independent expert, but an investigator who has played an active role in investigating Mr Peter Harb’s conduct, and recommended that disciplinary action be taken against him. Mr Tuckwell has also demonstrated no understanding of the role and obligations of an expert witness. While I accept that Mr Tuckwell has exercised judgement in making his recommendations as to what complaints should be the subject of disciplinary action against Mr Peter Harb, that goes to show some independence in the exercise of what might be described as his ‘prosecutorial discretion’, but it does not, in the circumstances, demonstrate that Mr Tuckwell is an unbiased, independent expert. I am not satisfied that in his evidence Mr Tuckwell provided the Tribunal with independent, objective, unbiased opinions, and therefore give his expert evidence no weight.
54 That, however, does not put an end to the allegations that Mr Peter Harb did not perform the works in a proper and workmanlike manner. In his report, and in the photographic survey taken by BCM consultants (pages 170 to 210) there are a series of photographs of the alleged defects which speak for themselves, and demonstrate that some of the works were defective. Specifically, they are sufficient to persuade me that:
a) there was a gap at the junction of the pitched roof beside the balcony and the flat roof at the rear of the property;

b) the barge capping above the rear balcony has not been installed parallel to the barge board, and is unsightly;

c) a downpipe has been fitted to an existing gutter in an unsightly fashion which limits the flow of storm water;

d) the facia to the first floor addition has been damaged by hammer blows;

e) different timber moulding (one square, one quadrant) have been used together above the balcony, which is unsightly; and

f) the bi-fold doors to bedroom three have been hung significantly out of alignment.

55 These findings accord with Mr Davie’s concession that there were ‘minor defects’. Mr Davie made one further submission of some relevance: that these defects exist in a job that was not finished, and would ordinarily have been corrected during the defects rectification period had Mr Peter Harb been allowed to return to the site. Mr Davie referred me to Mr Peter Harb’s statement to Mr Tuckwell during the onsite interview (at page 265 et seq) that he was kicked off the job and not allowed back in. Mr Grey took issue with this, saying that this was inconsistent with the letter from Harb Construction to Mr and Mrs Daniels of 3 April 2001 which said, in part:
We are instructed that our client has performed work in accordance with the contract with you and has attended to rectification of the defects in accordance with the contract.

Accordingly final payment is now due.

I accept Mr Grey’s submission in this regard and find on the basis of this letter that Mr Peter Harb considered that the contract was complete. I am therefore satisfied that Mr Peter Harb did not perform the matters set out on paragraph 48 in a proper and workmanlike manner. As such Mr Peter Harb is guilty of improper conduct for the purposes of s.62 of the Act as he breached the warranty implied into the contract by s.18B(a) of the Act that, “the work will be performed in a proper and workmanlike manner”.
F Carrying Out Work that Did Not Comply With the Building Code of Australia

56 This relates to Mr Peter Harb allegedly improperly constructing the junction of the roof and wall adjacent to the gutter in the kitchen, so as to allow water to enter the premises. The Respondent relied on Mr Tuckwell’s expert evidence and the photographs at page 98 of his report as evidence of this. The photographs do not speak for themselves. They rely on Mr Tuckwells ‘expert evidence’ to explain them. Given that I am not prepared to accept Mr Tuckwells evidence as expert evidence, I am not satisfied that the evidence demonstrates that there was a non-compliance with the Building Code of Australia.

G Not Being Fit to Hold a Contractor Licence

57 The core of this allegation relates to an allegedly false statutory declaration made by Mr Peter Harb and submitted to the Consumer Trader and Tenancy Tribunal in the course of the proceeding commenced by Mrs Daniels on 21 May 2001. The case was initially heard on 28 August and 2 November 2001. As already noted the reasons for decision of the Tribunal indicate that Mrs Daniels and Mr Peter Harb and Mr Steven Harb each represented themselves. After the hearing on 2 November 2001, Mr Peter Harb wrote to the Registrar of the CTTT on 4 December 2001 making submissions in support of his case. In that letter (page 306 to 309) Mr Peter Harb wrote:

We attach a sample of off-cuts from the job, which we have had verified as brushbox from suppliers, and a Statutory Declaration that these came from the … project, and could be physically matched to that installed on site.
The statutory declaration (page 264 & 264) was made by Mr Peter Harb and declared on 4 December 2001. It said:
THAT THE ATTACHED SAMPLE OF TIMBER IS A REMNANT FROM THE TIMBER SUPPLIED TO THE CONSTRUCTION SITE OF MR & MRS DANIELS AT 29 HARRIS STREET, BALMAIN FOR THE INSTALLATION OF A NEW TIMBER FLOOR AS BRUSHBOX TIMBER.

THE TIMBER ORDERED AND SUPPLIED WAS ORDERED FROM SUPPLIER AS BRUSHBOX TIMBER AND HAS SUBSEQUENTLY BEEN VERIFIED BY THEM AS SUCH.

FURTHER THAT THE TIMBER HAS NOT BEEN PURCHASED SUBSEQUENTYL (sic) OR PRIOR TO THAT JOB.

FURTHER THAT THIS COMPANY HAS NOT USED OT (sic) PURCHASED BRUSHBOX TIMBER ON ANY PREVIOUS OR SUBSEQUENT PROJECT.

THAT THE ATTACHED SAMPLE WILL MATCH EXACTLY THAT ON SITE.

The sample itself consist of four 8cm wide pieces of flooring timber, jointed together and mounted on a back board. When giving his evidence Mr Herbert was shown the timber and asked to identify what the timber was. He said it had features of brushbox, but could be northern box. He commented that it is often not possible to tell which is which, even with testing. He agreed that the depth of colour of timber can change when boards are polished and sealed, and that the floors at the works had been polished and sanded when he inspected them.
58 It was conceded by Mr Davie that the fourth paragraph of the statutory declaration was plainly wrong because the timber on the sample is 8 cm wide, whereas that laid at the works is 13 cm wide. It therefore could not match exactly. Mr Davie correctly submitted that there was no evidence of a comparison between the timber in the sample that laid at the works (apart from the issue of its width). This was a direct consequence of my refusing to allow such evidence to be tendered. As to the statement that the timber sample consisted of remnants from the site, Mr Davie submitted that there was no evidence that this was not the case. He anticipated Mr Grey’s objection that the timber in the sample is narrower than that laid at the works and therefore could not be a remnant, by submitting that it would be expected to be a remnant for precisely that reason.

59 This last submission stretches credulity. It requires a disjunctive reading of the assertions made by Mr Peter Harb in his statutory declaration, so as to read the assertions that the sample is a remnant of the timber laid at the works, as having no relation to the assertion that the sample would match the floor at the works exactly. I do not accept that this accords with a plain and ordinary meaning of the assertions made in the statutory declaration. Further, the submission requires an acceptance of the fact that the Mr Peter Harb was supplied with timber of a different size to that otherwise supplied to and laid by him, and was content to allow this non-standard timber not to be used, and to wind up as a remnant. Such a proposition offends against common sense and is inherently improbable. When combined with the inference I am able to draw, because Mr Peter Harb chose not to give evidence to the Tribunal, that his evidence would not have assisted his case, I am more than reasonably satisfied that Mr Peter Harb’s statutory declaration falsely asserted that the sample was a remnant, and would match exactly the timber on the site.

60 Mr Grey submitted that dishonesty of this nature must lead to conclusion that Mr Peter Harb is not a fit person to hold a contractors licence. In Hughes & Vale Pty Ltd v The State of New South Wales (No 2) (1955) 93 CLR 127 at 156 Dixon CJ, McTiernan and Webb JJ said, in relation to the "fit and proper person" test that its purpose:

. . .is to give the widest scope for judgment and indeed for rejection. "Fit" (or "idoneus") with respect to an office is said to involve three things, honesty knowledge and ability. .
Adapting the words of Deputy President Hennessey in Kioussis -v- Director General, Department of Fair Trading [2002] NSWADT 2 at paragraph 69, it is my view that, consistently with the decisions of the High Court in Hughes & Vale Pty Ltd v The State of New South Wales (No 2) and Australian Broadcasting Tribunal -v- Bond and Ors (1990) 170 CLR 321 the holding of a contractor licence under the Act attests that the holder is a person who will honestly perform his or her role as a contractor. I therefore accept Mr Grey’s submission that as a consequence of making a false declaration to the Consumer Trader and Tenancy Tribunal, Mr Peter Harb is not fit to hold a contractor licence. In doing so, I observe that this dishonest behaviour took place in the context of proceedings under the Act, and in circumstances where the greatest care has to be taken to ensure the honesty and integrity of one’s statements.
The Allegations against both Mr Peter Harb and Mr Steven Harb – Failing to Comply With a Tribunal Order

61 It will be recalled that the Consumer Trader and Tenancy Tribunal heard the claim made by Mrs Daniels on 28 August and 2 November 2001, and received submissions from the Mr Peter Harb in early December 2001. On 14 March 2002 the Consumer Trader and Tenancy Tribunal made orders in respect to the claim and provided written reasons for decision. The orders were:

In full and final satisfaction of all issues in dispute in matter No. BU 2001/5825 I order that:

1. Peter Harb & Steven Harb t/as Harb Constructions are jointly and severally liable to pay to Gayle Daniels the amount of $1,155. This amount is to be paid by 2 April 2002.

2. Peter Harb & Steven Harb t/as Harb Constructions are jointly and severally liable to pay to undertake work at 29 Harris Street, Balmain to ensure that the defects identified at paragraphs 6, 7 and 8 of these reasons have been rectified in a good and tradesman-like manner and in compliance with all applicable Australian Standards. This work is to be completed by 14 May 2002.

3. If for any reason the work referred to in Order 2 cannot be completed as ordered, either party may apply to have the matter re-listed any time prior to 30 April 2002.

4. If the work referred to in Order 2 is not completed as ordered, Gayle Daniels may apply to the Tribunal at any time prior to 31 May 2002 to seek a money order for the cost of the work. If no such application is received by 31 May 2002 the orders will be regarded as having been satisfied and no further action may be taken in relation to this application.

It should be understood that there was a fundamental problem with these orders, as no defects were identified in paragraphs 6, 7 and 8 of the reasons. The parties were formally notified of these orders by the Tribunal, in a notice of order dated 21 March 2002.
62 On 27 March 2002, Peter Martin from GMB Consultants, for Harb Constructions, wrote to the Registrar of the Consumer Trader and Tenancy Tribunal by fax as follows:

We have been asked by the Respondents in the above matter, messrs (sic) Peter & Steven Harb, to assist in the interpretation of the Orders issued on 14 March 2002.

In respect to para 2 of the Orders, mention is made of "..Harb Constructions are .. to ensure that the defects identified at paragraphs 6, 7 and 8 of these reasons have been rectified.."

With respect, having read the Orders, we are unable to specifically identify the particular items referred to by the Member, that need to be rectified.

The Respondents respectfully request further clarification

Please be advised that a Bankers Cheque for $1,155.00, as was requested in the Orders, has been forwarded by registered mail to the Applicant.

63 By a notice of order dated 2 April 2002 the Consumer Trader and Tenancy Tribunal amended its order of 14 March 2002 as follows:
On 28/03/02 the following orders were amended by the Tribunal in accordance with Section 50 of the Act. "the Slip Rule."

Paragraph 2 of the Orders made on the 14 March 2002 should be read as follows:

2. Peter Harb and Steven Harb t/as Harb Constructions are jointly and severally liable to undertake work at 29 Harris Street, Balmain to ensure that the defects identified at paragraphs (8), (9) & (10) of these reasons have been rectified in a good and tradesman-like manner and in compliance with all applicable Australian Standards. This work is to be completed by the 14 May 2002.

There is no evidence before me as to when this amending order was sent to Mr Peter Harb and Mr Steven Harb.
64 On 4 April 2002, GMB Consultants again wrote to the Consumer Trader and Tenancy Tribunal by fax, as follows:
We have still not received clarification of the “work referred to in Order 2" of the Orders made in the above matter, and therefore cannot comply with such.

The only paras 6,7 & 8 of the Orders, on P.2 thereof do not identify any list of items to be rectified.

Therefore, with respect, we request you submit by fax or post the exact items required to be, rectified by the builder.

Due to the difficulty in understanding which items Are referred to, time has passed, and we request that an extension be made, once the builder fully understands his task, beyond 14 May 2002, for the builder to execute such work.

I interpolate that, even if the notice of amending order had been sent to Mr Peter Harb and Mr Steven Harb on the day it was dated, 2 April 2002, it would not have reached them in the ordinary course of post by the time this further request was sent.
65 On 13 May 2002 GMB Consultants wrote to the Consumer Trader and Tenancy Tribunal twice. The first letter shows that it was be hand delivered and faxed. It reads:
URGENT URGENT URGENT

Dear Sir,

Harb Constructions & Daniels. HB 01/75825

Following numerous faxes and telephone calls to your office (particularly your Mr Sarkis), we have had no response whatever to illuminate the Respondents in the above matter as to their requirement of the Notice of Order, if any.

We have sought clarification WITH NO RESULT since 27th March 2002, of the Orders.

Therefore, due to this lack of response by the Department, the builder has been unable to do any work that may be required to the property at 29 Harris Street, Balmain, which work, if any, is to be completed by 14 May 2002.

As a matter of urgency, we request that the Tribunal contact the undersigned, or the builder, Harb Constructions direct, to discuss this matter.

The second letter from GMB Consultants on that day shows that it was to be faxed. It reads:
Further to our conversation seeking clarification of orders in the above matter, we confirm that an error in transcribing the members requests has occurred.

As we have for some considerable time being attempting to ascertain this (copies attached), no work has been carried out in this respect.

Therefore we request that a reasonable time be allowed by the member. we suggest 90 days from this date, and we respectfully request confirmation of the CORRECT list of defects be sent.

We await your response, and thank you for finally clarifying the matter

66 Mr Davie said that his instructions were that his clients had never received the amending order. His instructions were that after the letters from GMB Consultants to the Tribunal dated 13 May 2002, the next thing his clients received was a Notice of Order from the Consumer Trader and Tenancy Tribunal dated 4 June 2003 which said:
On 27/05/02 the Tribunal made the following order.
1 In full and final satisfaction of all issues in dispute 1 order that PETER & STEVEN HARB T/AS. HARB CONSTRUCTIONS, 35 Wisdom Street, GUILDFORD NSW 2161 are jointly and severally liable to pay the applicant, GAYLE DANIELS, 29 Harris Street, BALMAIN NSW 2041 the sum of $12,881.00 by 27 June 2002.
There is no dispute that neither Mr Peter Harb nor Mr Steven Harb were in attendance when this order was made.
67 In her statement, Mrs Daniels said that she attended the Tribunal hearing on 27 May 2002 having received a notice of hearing, dated 17 May 2002 advising that the matter was listed:
FOR MENTION. For correction of orders and to hear an application for extension of time.
She said that after she received this notice she wrote to the Tribunal requesting that a money order be made. It should also be noted that she makes no mention of whether or not she received payment of the $1,155 ordered to be paid by 2 April 2002 (order 1 of the orders made 28 March 2002).
68 In a faxed request dated 19 June 2002, and stamped as received by the Consumer Trader and Tenancy Tribunal on 20 June 2002, Mr Peter Harb wrote to the Registrar as follows:
We request a letter of the 4th April 2002 from the DFT clarifying the original orders in the matter, which was never received by us. Thankyou.
This was followed by what Mr Davie described as an ‘unwise’ letter from the Applicant’s solicitors to the Tribunal, dated 24 June 2002, demanding that the order of 27 may be vacated. The Tribunal’s Legal officer replied by letter dated 26 June 2002 drawing the Applicant’s attention to their rights of rehearing and appeal.
69 There was no dispute that Mr Peter Harb and Mr Steven Harb did not comply with the order made on 27 May 2002 (notice of which was dated 4 June 2002), and that Mrs Daniels was forced to levy execution against them. They did not exercise their rights of appeal or seek a rehearing.

70 During the hearing I sought the assistance of the parties representatives in trying to clarify the exact course of events surrounding the Consumer Trader and Tenancy Tribunal orders. The CTTT's file had been produced on summons and I asked them to examine the file to see if it clarified details about what documents were sent to Mr Peter Harb and Mr Steven Harb, and when and to where they were sent. The representatives advised me after examining the file that it did not clarify any of the issues.

71 As I understand the Administrator’s decision, it was found that Mr Peter Harb and Mr Steven Harb had failed to comply with both the initial order of the Consumer Trader and Tenancy Tribunal made 28 March 2002 (as amended) and the final monetary order of 27 May 2002. In the light of the evidence before me I do not agree that this was the correct and preferable decision with respect to the first (and amended) order. I am not persuaded on the evidence that Mr Peter Harb and Mr Steven Harb knew, prior to the final money order being made in place of that work order, of the final form that work order took, so that they could comply with it. At the same time, there is no evidence before me which shows that they failed to comply with the monetary order of 28 March 2002 (order 1). Indeed what evidence there is, the advice of payment in letter of 27 March 2002 from GMB Consultants, points to the likelihood that it was paid.

72 I am, however, satisfied that both Mr Peter Harb and Mr Steven Harb failed to comply with the Tribunal order of 27 May 2002 (notice of which was dated 4 June 2002). This is improper conduct within the meaning of s,51(2)(c) of the Act, and grounds for disciplinary action under s.56.

Disciplinary Action – Submission

73 In Mr Peter Harb’s case the Administrator determined to cancel his contractor licence, disqualify him from obtaining a contractor licence for 5 years, and require him to pay a penalty of $4,000. Mr Grey submitted that this was the appropriate penalty. Mr Davie submitted that the penalty was excessive, in circumstances where there was no evidence of prior misconduct. He drew my attention to the facts that:

a) the failure to undertake the works in a proper and workman-like manner related to only minor defects, and that the prejudice suffered by Mr and Mrs Daniel’s had been dealt with by civil remedies;

b) that Mr Steven Harb had admitted that there was no insurance in place for the works and that the boards he had sent to the CTTT were not exactly the same size as that laid at the works;

c) the failure to pay the Tribunal’s final monetary order followed a series of confusing circumstances, and he submitted were not the result of wilful misunderstanding or ignorance;

d) that I should not attribute any fraudulent or dishonest intent to Mr Steven Harb in making the false statutory declaration and submitting it to the Consumer Trader and Tenancy Tribunal; and

e) that Mrs Daniels had been a difficult client (referring to page 278).

74 Mr Davies noted that a penalty of the nature imposed on Mr Peter Harb was appropriate in the most serious of cases. He referred me to the decisions of the Fair Trading Tribunal in Director General, Department of Fair Trading v O’Connell an unreported decision of Deputy Chairperson McDonell in the Fair Trading Tribunal made on 8 November 2000 (BU2000/3762). In that case the Tribunal disqualified the contractor from obtaining a licence for 18 months. No prior misconduct was alleged against the contractor, but the Tribunal was satisfied that there were major and substantial structural defects in the work performed by Mr O’Connell.

75 The Administrator saw fit to cancel Mr Steven Harb’s contractors licence and disqualify him from holding a licence for a period of two years, Mr Grey submitted that this was an appropriate penalty for refusing to comply with a Tribunal order. Mr Davie, on the other hand, submitted that Mr Steven Harb involvement was entirely peripheral, and that if I found he had committed anything warranting disciplinary action, that no penalty was necessary. He has already, he said, suffered penalty enough, especially given that there was no allegation of prior misconduct by him.

Disciplinary Action – Peter Harb

76 In Mr Peter Harb’s case I have concluded that as the holder of a contractor licence he has:

a) failed to notify the administrator of a change of particulars relating to a business name;

b) misrepresented that Harb Construction was the holder of a contractor licence;

c) carried out residential building work without a contract of insurance being in place;

d) installed flooring other than as agreed ;

e) did not carry out the works in a proper and workman-like fashion, albeit the defects are not major;

f) failed to comply with money order made by the Consumer Trader and Tenancy Tribunal on 27 May 2002; and

g) that he is not fit to hold a contractor licence because of his lack of honesty in submitting a false statutory declaration to the Consumer Trader and Tenancy Tribunal.

77 I do not accept the submissions that I should regard Mr Peter Harb as having no fraudulent or dishonest intent when he submitted the statutory declaration. As noted above I find the explanation proffered of that conduct to be highly improbable and can only conclude that he was seeking to obtain an advantage in the Consumer Trader and Tenancy Tribunal proceedings, when he submitted it. That in my view is clear evidence of dishonesty.

78 With respect to the issue of the absence of insurance I regard this is a most serious matter. Mr Peter Harb accepted payment and proceeded to undertake the works without a certificate of insurance, and thereby placed his clients in serious peril. His actions undermined, and deprived them of, the essential protection which the legislative scheme regulating the home building industry, provided by the Act, seeks to put in place. The fact that he has suffered the civil consequences that the Act stipulates may befall him in such circumstances does not detract from the seriousness of his conduct.

79 With respect to the failure to comply with the Tribunal order, I accept that his failure to comply with that order was made against the background of significant confusion relating to the Tribunal’s original work orders. It did, however, occur in circumstances where Mr Peter Harb had rights of appeal and rehearing, which were not exercised. At the same time, compliance by licenced contractors with orders made by the Consumer Trader and Tenancy Tribunal in its home building jurisdiction is an essential part of the legislative scheme for the regulation of the home building industry, and the protection of consumers engaging contractors to perform residential building work. Non-compliance with orders of the Consumer Trader and Tenancy Tribunal is improper conduct and merits disciplinary action. Similarly, misrepresenting who is the holder of a contractor licence serves to undermine the legislative scheme, and detracts form the protection it seeks to offer consumers. Likewise, I regard non-compliance with an agreed specification for a matter such as the type of timber to be used on the floors of residential premises to be serious improper conduct, as the cost of rectifying such matters is generally prohibitive. With respect to the other matters alleged against Mr Peter Harb I accept that when compared to the matters discussed above they are relatively minor, but it must be remembered that they too flout the requirements of the scheme.

80 In considering what disciplinary action to take I am cognizant of the fact that the purpose of disciplinary action is not to punish Mr Peter Harb but to protect the public: Clyne v NSW Bar Association (1960) 104 CLR 186 at 201. In reviewing the matters I have found against Mr Peter Harb I have sought to highlight the dangers conduct such as his exposes members of the public to. I have also borne in mind that no prior misconduct is alleged against him.

81 In my opinion the Administrator was correct to cancel his contractor licence. I am of the view, however, that the period of disqualification, given the matters I have found against Mr Peter Harb, was greater than his offences call for. It is my view that a disqualification period of three years would be preferable. Given that decision, I do not consider it appropriate to impose a monetary penalty as a consequence of the cancellation and disqualification is that Mr Peter Harb is likely to be financially strained. In those circumstances the imposition of a financial penalty would not, in my view serve to protect the public, but rather would have a punitive effect on Mr Peter Harb.

82 In Mr Peter Harb’s case, therefore, the decision of the Tribunal is to:

a) affirm the decision of the Administrator to cancel Mr Peter Harb’s contractor licence;

b) sets aside the determination of the Administrator to disqualify Mr Peter Harb from obtaining a contractor licence for 5 years and to impose a penalty of $4,000.00; and,

c) substitutes that determination with a decision that Mr Peter Harb be disqualified from holding a contractor licence for a period of 3 years.

Disciplinary Action – Mr Steven Harb

83 It will be seen that I have concluded that Mr Steven Harb as the holder of a contractor licence failed to comply with the monetary order of the Consumer Trader and Tenancy Tribunal made on 27 May 2002. His involvement in the issues giving rise to that order was peripheral, although the order was very clearly directed to both Mr Peter Harb and him. It required action on his behalf. As with Mr Peter Harb, I accept that his failure to comply with that order was made against the background of significant confusion relating to the Tribunal’s original work orders. It did, however, occur in circumstances where Mr Steven Harb had rights of appeal and rehearing, which were not exercised. Those factors, together with Mr Steven Harb’s hitherto unblemished record, persuade me that Mr Steven Harb’s actions in this case do not warrant the cancellation of his licence.

84 Non-compliance with orders of the Consumer Trader and Tenancy Tribunal is improper conduct and, in my view, merits disciplinary action. While not persuaded that Mr Steven Harb’s conduct in the circumstances of this case merits cancellation or disqualification, I am of the view that the protection of the public requires the taking of disciplinary action against him, which reflects the seriousness of Mr Steven Harb’s failure to comply with the order. In all the circumstances, I am of the opinion that the appropriate disciplinary action is to reprimand Mr Steven Harb for his improper conduct, and to direct that he pay a penalty of $1,650.00 to the Administrator.

85 In Mr Steven Harb’s case, therefore, the decision of the Tribunal is to set aside the determination of the Administrator and substitutes that decision with a finding that Mr Steven Harb is guilty of improper conduct within the meaning of s,51(2)(c) of the Act, and determines that he:

a) is to be reprimanded for that improper conduct; and

b) is to pay a penalty of $1,650.00 to the Administrator.