Hunt v Director General, Department of Services Technology and Administration

[2010] NSWADT 186

CITATION:	Hunt v Director General, Department of Services Technology and Administration [2010] NSWADT 186
DIVISION:	General Division
PARTIES:	APPLICANT Aaron Hunt RESPONDENT Director General, Department of Services Technology and Administration
FILE NUMBER:	093303
HEARING DATES:	26 & 24 March 2010 and 6 May 2010
SUBMISSIONS CLOSED:	14 May 2010
DATE OF DECISION:	27 July 2010
BEFORE:	Higgins S - Judicial Member
CATCHWORDS:	Application for certificate of registration as a real estate salesperson – refusal of application – applicant a disqualified person by reason of a conviction of dishonesty - whether the conviction should be ignored – whether the applicant otherwise a fit and proper to be issued with a certificate
LEGISLATION CITED:	Property Stock and Business Agents Act 2002
CASES CITED:	Hunt v Commissioner for Fair Trading [2008] NSWADT 280 Commissioner for Fair Trading, NSW Office of Fair Trading v O’Connor (GD) [2007] NSWADTAP 37
REPRESENTATION:	APPLICANT D Yuide, solicitor RESPONDENT W Maynard, solicitor
ORDERS:	The decision of the respondent is affirmed

REASONS FOR DECISION

1 This is an application by Aaron Hunt (Mr Hunt) seeking review of a decision of a delegate of the Director-General of the Department of Services, Technology and Administration (the respondent), refusing his application for a certificate of registration as a real estate salesperson, under the Property Stock and Business Agents Act 2002 (the Act).

2 Mr Hunt is aged 38 and was issued with a real estate agent’s licence in December 1996. He remained the holder of such a licence until 4 December 2007. In November 2007, he made an application for renewal of his licence, however, the respondent refused that application on the basis that he was a disqualified person: see section 16 of the Act. He was disqualified by reason of having been convicted, on 8 August 2007, by the Local Court of New South Wales, of 8 dishonesty charges (i.e. offences of obtaining money by deception). The convictions and sentences were confirmed on appeal by the District Court in November 2007.

3 In 2008, Mr Hunt was unsuccessful in his application for review, to the Tribunal, of the respondent’s decision to refuse to renew his licence application: see Hunt v Commissioner for Fair Trading [2008] NSWADT 280. In its reasons for decision, at [27] to [30], the Tribunal said the following:

‘27 There are serious obligations that are imposed on a licensee. Mr Hunt was either aware of those obligations and did not address them, or alternatively his knowledge is deficient. In my view, it is probable that Mr Hunt was aware of his obligations and has chosen not to act on the knowledge. That being the case, Mr Hunt should not be permitted to hold a real estate agent’s licence.

28 There may be circumstances where a period of three years since an offence of this kind would be sufficient to warrant the ignoring of the offence, but my view, this is not one of those cases.

29 Obligations are imposed on a licensee are for the protection of the public. For that reason it is important that a licensee be aware of those obligations and be able to comply with them. In these circumstances I am not confident that Mr Hunt is able to carry on a business in a way that ensures that the interests of the public are protected. Until he can do so, he should not be permitted to hold a real estate agent’s licence.

30 With the passage of more time the Commissioner may be able to be satisfied that Mr Hunt has the knowledge and ability to comply with the obligations are imposed on a licensee. He could possibly reduce the amount of that time if he were to undertake further training to update his knowledge and to focus his awareness on the importance of the licensing regime.’

4 In June 2009, Mr Hunt made an application for a certificate of registration under the Act. In support of this application was a letter written by Mr Hunt’s solicitor, Mr D Yuide. A delegate of the respondent refused that application. On internal review, another delegate of the respondent affirmed the decision. It is the latter decision that is the subject of this application.

The issues

5 It is not disputed that by reason of section 16 of the Act that Mr Hunt is a ‘disqualified person’. That section relevantly provides as follows:

16 Disqualified persons

(1) A person is a disqualified person for the purposes of this Act if the person:
(a) has a conviction in New South Wales or elsewhere for an offence involving dishonesty that was recorded in the last 10 years, unless the Director-General has determined under subsection (2) that the offence should be ignored, or
…

(2) The Director-General may determine that an offence committed by a person should be ignored for the purposes of this section because of the time that has passed since the offence was committed or because of the triviality of the acts or omissions giving rise to the offence.

6 The primary issue in this application is whether, having regard to all the relevant material before the Tribunal, the discretion as set out in sub-section 16(2) of the Act should be exercised in Mr Hunt’s favour.

7 It was the respondent’s contention that even if the Tribunal were to find that it was appropriate to exercise the discretion in favour of Mr Hunt, Mr Hunt’s conduct was such that he could not be considered to be a fit and proper person to be issue with a certificate of registration: see paragraph 14(3)(b) of the Act. For the reasons set out below, it is unnecessary for me to determine this issue as I have found, on the material before the Tribunal, that there is no basis on which to exercise the discretion set out in subsection 16(2) of the Act. I would however indicate that my findings in regard to the seriousness of the offences for which Mr Hunt was convicted equally apply to considerations as to his fitness and propriety to be granted a certificate of registration. Additionally, while it is noted that Mr Hunt has undertaken some additional training as suggested by the Tribunal in its earlier decision, I also noted that Mr Hunt had not undertaken any form of employment since his previous licence lapsed in 2007.

Mr Hunt’s convictions

8 The offences for which Mr Hunt was convicted occurred between 25 June and 5 July 2005 while he was employed as a Senior Property Manager for Angus Levitt Property Agents (the company). The company acted as agents for sellers and buyers of properties and it also managed rental properties on behalf of their owners. Included in these rental properties were rental properties in which Mr Hunt had an interest.

9 The offences of which Mr Hunt was convicted involved 8 incidents where Mr Hunt directed the receptionist, employed by the company, to access rental bond refunds paid to the company from the Rental Bond Board, on behalf of tenants of properties the company had under management. On each occasion, at Mr Hunt’s direction, the receptionist deposited the value of the cheque, or part thereof, into Mr Hunt’s rental property account and identified the payment as being for repairs (i.e. cost of repairs to the tenanted property to which the bond refund related). These amounts the Tribunal understands were then paid to Mr Hunt personally. The total amount involved was $6,957.08.

10 According to the police fact sheet, on about 6 July 2005, the company’s Accounts Manager discovered the discrepancy. The Directors of the company approached Mr Hunt, who initially denied any knowledge of the transfers but later made a full admission and said he had every intention of repaying the money he had taken.

11 The fact sheet also states that the Directors of the company informed the respondent’s Office of Fair Trading of the discrepancies on 18 July 2005. It was Mr Hunt’s evidence that he had contacted the Office. It was not until early March 2007 that police charged Mr Hunt. It was the Tribunal’s understanding that the Directors of the company had, some time after Mr Hunt left the employ of the company, brought the matter to the attention of the police. Mr Hunt left the employ of the company in 2005, not long after the incidents had occurred and he went to work for another real estate company as their licensed real estate agent.

12 On becoming aware of the involvement of the police, Mr Hunt voluntarily attended his local Police Station and co-operated fully with their enquiries. He was originally charged over 12 incidents of misappropriation. However, 4 of these were not pressed when he pleaded guilty to the remaining charges. The 4 charges that were not pressed related to conduct that had occurred much earlier in time.

13 The police fact sheet also states that Mr Hunt had explained that at the time of the offence he was ‘under extreme pressure as he was behind in his mortgage and his tenant was behind in rent. The accused states that he attempted to refinance with a broker but it fell through before he accessed the unclaimed Bond money.’

14 As mentioned above, Mr Hunt was fined and was made subject to a good behaviour bond. That bond was for a period of 12 months (expiring in August 2009) in regard to the offences involving the more substantial amounts that were misappropriated.

Exercise of the sub-section 16(2) discretion

15 Construction of the discretion in sub-section 16(2) of the Act was considered by the Appeal Panel in Commissioner for Fair Trading, NSW Office of Fair Trading v O’Connor (GD) [2007] NSWADTAP 37. At [34] the Appeal Panel noted that there were only 2 factors to be taken into account in the exercise of this discretion; namely (a) ‘the time that had passed since the offence was committed’ and (b) ‘the triviality of the acts or omissions giving rise to the offence’. At [37] and [38] the Appeal Panel held that factors such as what the applicant had done since the offences were committed was not a relevant consideration in the exercise of the discretion under sub-section 16(2) of the Act. Yet in considering the ‘triviality of the acts and omissions giving rise to the offence’ regard may be had to the ‘the risk to consumers’ of the criminal conduct in question.

16 Mr Hunt did not contend that the offences for which he had been convicted were trivial. He accepted the seriousness of these. At the same time he contended that they were not at the most serious end of the scale of dishonesty offences. His primary submission was that the acts and omissions giving rise to his convictions occurred within several days of each other and almost 5 years had passed since they occurred. He also relied on the fact that he was applying for was a certificate of registration and not a licence. The difference he contended was significant in that a certificate of registration only authorised him to act as a real estate salesperson and in this position he would not be handling any money. Alternatively, he submitted that he would be content with being granted a certificate of registration that was subject to conditions prohibiting him from dealing with any money.

17 The issue of a licence or a certificate of registration subject to conditions is not a matter that is relevant to the exercise of the discretion under sub-section 16(2) of the Act. Nor, in my opinion does sub-section 16(2) of the Act, provide for a distinction to be made on the type of the authority an applicant has applied for under the Act. In this regard I note that a ‘real estate salesperson’ is defined in section 3 to mean the following:

" real estate salesperson " means a person (other than the holder of a real estate agent’s licence) who, as an employee of a real estate agent or a corporation that carries on the business of a real estate agent:

(a) exercises any of the functions of a real estate agent, or
(b) engages in any other activity that is prescribed by the regulations for the purposes of this definition.

18 The term ‘real estate agent’ is also defined in section 3. It is given a very broad meaning and as indicated by the above definition, a real estate salesperson is authorised to do what a real estate agent does. The only difference is that the real estate agent is the person carrying on the business (i.e. the principal) and the real estate salesperson is the employee, for whom the principal is responsible. Furthermore section 16(1)(a) and (2) of the Act do not distinguish as to whether a person has applied for a real estate licence or a registration certificate.

19 What the section does provide is that any applicant for an authority under the Act, who has been convicted of a dishonesty offence within 10 years of having made his or her application, that person is a disqualified person for the purposes of the Act. That is, such a person is prima facie not eligible to be granted an authority under the Act. To be eligible for consideration the respondent was required to take the next step and make a finding, under subsection 16(2) of the Act, that the dishonesty offence was to be disregarded. As mentioned above, in making such a finding Parliament has specified, through the respondent (hence the Tribunal), must have regard to the matters that are referred to in that sub-section. In my opinion those matters are not necessarily mutually exclusive – both may be applicable depending on the circumstances of each case.

20 In this application, I find that the acts and omissions that gave rise to the offences committed by Mr Hunt were very serious. They were calculated and deliberate. Mr Hunt targeted cheque amounts that he knew to have been outstanding (unpaid to or unclaimed by the relevant tenant) for some time. These were amounts that were least likely to come to the attention of anyone. Additionally, he used his authority over the receptionist to perpetrate the misappropriation. I accept Mr Hunt’s evidence that at all times he intended to repay the amounts unlawfully transferred into his property account. However, this does not excuse the conduct or the very serious breach of trust he perpetrated in his privileged position as a licensed real estate agent. I also accept that Mr Hunt regrets what he did. This factor and the fact that he immediately repaid the amounts taken are not relevant considerations for the purpose of section 16(2). They are of course matters that are relevant to the issue as to whether Mr Hunt is a fit and proper person, at this time, to be issued with a certificate of registration.

21 In light of my finding as to the seriousness of Mr Hunt’s conduct, in my opinion, a period of 5 years since the offences were committed is not sufficient time so as to make a determination that the offences should be ignored. That determination, in my opinion cannot be made for another 3 years; namely 8 years from the date the offences were committed. This period of time, in my opinion, is the appropriate time given the nature of Mr Hunt’s offending conduct. Had the offences not occurred in the course of the licensed activity for which he now seeks an authority, I may have come to a different view.

Conclusions

22 On the basis of my findings, Mr Hunt remains a disqualified person and, by reason of paragraph 14(3)(d) of the Act, he is not eligible for the grant of a certificate of registration as a real estate salesperson. I note that in the Tribunal’s earlier decision no reference was made to the decision of the Appeal Panel in O’Connor (supra). That decision, in my opinion, also provides guidance on the approach that is to be taken where an applicant for an authority under the Act has been convicted of a dishonesty offence. That approach is to first and foremost determine the question as to whether the discretion in sub-section 16(2) of the Act should be exercised. If the discretion is exercised in favour of the applicant, then, subject to the facts in each case, consideration of the applicant’s fitness and propriety may nevertheless remain an issue for determination. As I have mentioned, it is in this context that conduct of the applicant subsequent to the conduct that constituted the dishonesty offence may be a relevant matter to take into account.

23 For the reasons set out above, in my opinion the decision of the respondent to refuse to grant Mr Hunt a certificate of registration as a real estate sales person is the correct and preferred decision. On this basis the appropriate order is to affirm the decision of the respondent.