Jaques v Director-General, Department of Fair Trading
[1999] NSWADT 111
•17 November 1999
CITATION: Jaques -v- Director-General, Department of Fair Trading [1999] NSWADT 111 DIVISION: General APPLICANT: Shayne Jaques RESPONDENT: Director- General, Department of Fair Trading FILE NUMBER: 993108 HEARING DATES: SUBMISSIONS CLOSED: 08/17/1999 DATE OF DECISION: 17 November 1999 BEFORE:
K P O'Connor DCJ - PresidentPRIMARY LEGISLATION: Home Building Act 1989 APPLICATION: Review of decision to refuse to grant a Home Builders licence - MATTER FOR DECISION: Principal matter REPRESENTATION: Applicant:
Respondent:
In person
A Grey, solicitor, Department of Fair TradingORDERS: 1. Decision under review affirmed.
1 The applicant applied to the Director-General, Department of Fair Trading (‘the administrator’) on 23 June 1998 for variation of an existing contractor licence for residential building work which was limited to specified categories of work. The licence had been issued by the administrator pursuant to the provisions of the Home Building Act 1989 (‘the Act’).2 The categories of work to which the licence was limited were: carpentry and joinery, concreting, glazing and drywall plastering (Licence No 83162C issued on 21 May 1997 with an expiry date of 9 May 1999). The applicant sought a variation to permit him to enter into contracts and to undertake work as a residential builder, covering all classes of building and trade work.
3 The licence had been issued pursuant to mutual recognition arrangements after the applicant had moved to New South Wales from Queensland and after confirmation of the applicant’s Queensland registration: see generally Mutual Recognition (New South Wales) Act 1992.
4 The application for variation was refused following the applicant’s failure on two occasions to pass an examination conducted by the Building Industry Skills Centre (‘BISC’) on behalf of the Department. The applicant applied for internal review. His submissions in support of reversal of the decision are referred to in detail later in these reasons. In summary he referred to his long experience in building work and expressed dissatisfaction as to aspects of the written tests. By letter dated 27 April 1999 the administrator affirmed its decision.
5 On 31 May 1999 the applicant made the present application for review pursuant to s 83B of the Act.
6 At a directions hearing on 22 July 1999 the parties agreed to the Tribunal dealing with the matter on the papers: see Administrative Decisions Tribunal Act 1997 (‘the Tribunal Act’), s 76. As directed, the administrator lodged its file and submissions on 6 August 1999. The applicant chose not to make any further submissions, relying on his written submission to the administrator on the occasion of the internal review.
7 The Tribunal subsequently sought clarification from the administrator as to its practices. The administrator advised (letter dated 29 October 1999, copy provided to applicant) the Tribunal that it dealt with the applicant’s application as an application for variation of the endorsement on the existing licence. The provisions relevant to licences and endorsed licences are referred to later in these reasons.
8 I accept the administrator’s advice. I should note, however, that this characterisation of the application is not evident from the file material lodged by the administrator with the Tribunal. The form completed by the applicant in which he made his application for variation is a standard form issued by the administrator (‘Form L7’) headed ‘Contractor Licence - Individual’ with a box, marked by the applicant with a cross, stating ‘Variation to Existing Licence (No Fee Required)’. The administrator’s letter of 11 June 1998 replying to the application describes it as an ‘application for a contractor licence/qualified supervisor certificate to carry out building work’. The administrator explained in its advice of 29 October 1999 that this was a ‘generic letter’ used by it for the issuance of both licences with an endorsement and qualified supervisor’s certificates, as “it regards the technical and experience requirements … to be the same…”. It also said in explanation that the reference in the letter of 11 June 1998 to “‘your recent application for a contractor licence/qualified supervisor certificate’ only reflects the dual purpose for which this pro-forma letter is used.” Clearly the administrator’s communication practices are confusing.
9 It would assist the process of external review if administrative procedures and descriptions adopted by administrators directly corresponded to the categories laid down in the statutory scheme.
The Legislative Scheme
10 The administrator’s responsibilities in relation to the issuance of contractor licences are set out in Part 3 of the Act, Division 1 (s 19 to s 23). Issuance of certificates and endorsed licences is dealt with in Division 2 (s 24 to s 28). Division 3 (s 29 to s32) deals with owner-builder permits, and is not relevant to this case. Division 4 is relevant. It contains provisions about procedures and powers relevant to all of the types of authority referred to in the earlier Divisions.
11 Section 19, as relevant, provides:
“19 Applications for licences
12 Section 20 provides:
(1) An individual, a partnership or a corporation may apply to the Director-General for a licence authorising its holder to contract to do such one or more of the following things as may be specified in the application:
(2) An application for a licence is to be accompanied by such particulars as are required by the Director-General concerning:
(a) to do residential building work,
(b) …,
(c) …
(3) Further particulars concerning any of those matters may be requested by the Director-General after the application has been lodged.”
(a) the fitness, ability and capacity of the applicant to carry out contracts for which the licence is required, and
(b) the arrangements made or proposed by the applicant to ensure that all work done under those contracts will be done or supervised by appropriately qualified individuals.
“20 Issue of licences
13 Section 21, as relevant, provides
(1) After considering an application, the Director-General must:
(2) The regulations may fix or provide for the Director-General to determine standards or other requirements that must be met before any licence is issued or before a licence of a particular kind is issued.
(a) issue a contractor licence to the applicant, or
(b) reject the application by serving on the applicant a notice setting out the reasons for rejecting the application.
(3) The Director-General must reject an application for a licence if:
(4) (Repealed)
(a) the Director-General is not satisfied that any such requirement would be met were the licence to be issued, or
(b) the Director-General is not satisfied with the applicant's proposed arrangements for supervision of the work which the licence will authorise the applicant to contract to do.
(5) A decision of the Director-General relating to determining standards or other requirements under subsection (2) cannot be reviewed by the Administrative Decisions Tribunal in an application for review made under subsection (2).
“21 Authority conferred by licences
14 The procedure for application for a variation is governed by s 34 of the Act.
(1) A licence authorises its holder to contract to do such residential building work, …, as may be described in the licence when it is issued.
(1A) …..
(2) The authority conferred by a licence:
(a) is subject to the conditions applicable to the licencee for the time being, and
(b) may, on the application of the holder of the licence, be varied by an order of the Director-General set out in a notice served on the holder of the licence.”
15 The power to issue an endorsed licence is conferred by s 26 which provides:
“26 Issue of endorsed licences
16 Section 28 provides:
If a licence is issued to an applicant who the Director-General considers is qualified to hold a supervisor certificate, the Director-General may, instead of issuing such a certificate, endorse the licence to show that it is equivalent to such a certificate.”
“28 Authority conferred by endorsed licences
17 In its submission the administrator noted that there is no provision in Part 3 of the Act stating expressly what requirements govern applications for variation of licences or of endorsed licences.
(1) An endorsed licence authorises its holder to do (and to supervise) the same residential building work, or specialist work, as it authorises its holder to contract to do.
(2) The authority conferred by an endorsed licence is subject to the conditions applicable to the licence for the time being.
(3) The authority conferred by an endorsed licence may be varied in the same way as that conferred by any other licence.”
Position in relation to Licence Variation Applications
18 Section 19 appears only to deal with the procedure to be followed, and criteria to be satisfied, in relation to initial applications for licence.
19 The administrator submitted that when Part 3 is read as a whole it is the obvious intention of the Act that all persons applying for a variation are subject to those requirements that would attach to an initial application to do the work the subject of the application for variation.
20 Part 3 covers various licensing stages: for example, application (s 19), variation (s 21) and automatic cancellation (s 22). The legislative scheme introduces the facility of the “endorsed licence” (s 26) within the provision dealing with qualified supervisor’s certificates (Division 2 of Part 3). Later at Division 4 of Part 3 there are a number of common provisions applicable to licences, certificates and owner-builder permits. The general term “authority” is used to deal collectively with these items: see definition of “authority” (s 33) defined as covering a licence (whether or not an endorsed licence), a supervisor or registration certificate, or an owner-builder permit. Provision is made, for example, for renewal of authorities (s 39), restoration of authorities (s 39) and provisional authorities (s 38). The right to apply for review is conferred on applicants for the “issue or alteration of an authority” (s 83B).
21 The section relating to provisional authorities gives, perhaps, the clearest insight into the way the scheme of regulation is meant to work. In that section, s 38(1), it is provided that -
“The Director-General may, but only if the Director-General considers that special circumstances exist, issue an authority to an applicant even though the applicant does not meet a requirement imposed by or under this Act for the issue of the authority.”
22 This provision is an indication of a Parliamentary intent that the administrator must ensure that usual conditions are met when ordinary authorities are issued. So in the case of an application seeking a more generous endorsement to a licence, it would follow that the administrator must apply to the extent appropriate the requirements of the statutory scheme as they relate to the class of authority in issue.
23 It would be anomalous if the administrator were to be at liberty to apply different standards to a variation application as compared with an initial or renewal application. Clearly it may not be necessary or fair for the administrator to re-examine matters that have been satisfied in relation to the initial application (including those matters determined without further enquiry because of mutual recognition arrangements).
24 I agree that the administrator must apply to the extent appropriate the requirements of the statutory scheme as they relate to the class of authority in issue.
Regulations and Standards
25 Section 20(2) provides that the regulations “may fix or provide for” the administrator “to determine standards or other requirements that must be met before a licence is issued or a licence of a particular kind is issued”. The relevant regulations are cl 19 and cl 20 of the Home Building Regulation 1997.
26 Clause 19 sets out the requirements as to which the administrator must be satisfied in the case of applications for licences. These relate to such matters as the arrangements that the applicant has, or proposes to make to ensure that all work permitted by the licence is carried out by qualified individuals, any disqualifying factors, solvency and character.
27 In cl 19(d) it is stated that the administrator must be satisfied that:
“the applicant, if applying for an endorsed licence, complies with the requirements prescribed by clause 20 (d)-(h) in relation to applicants for a qualified supervisor certificate.”
28 All of these requirements must be satisfied but only those in (d), (e) and (f) are in issue. These paragraphs provide that before a certificate is issued the administrator must be satisfied that the applicant:
“(d)has such practical qualifications or has passed such examinations or practical tests, or both, as the Director-General determines to be necessary to fit the applicant to do, to supervise, the work for which the certificate is required, and
(e) has had experience of such a kind and for such a period, as the Director-General considers would fit the applicant to do, or to supervise, the work for which the certificate is required, and
(f) is capable of doing or supervising work for which the certificate is required”.
29 In relation to matters referred to in paragraphs (d), (e) and (f) the administrator has issued a brochure headed Residential Building and Building Trade Work (‘Form L20’). The introduction states that the brochure details the technical/formal qualifications and practical experiences accepted by the administrator for issue of an individual Contractor Licence or Qualified Supervisor Certificate for various categories of residential building and building trade work.
30 The first category dealt with in the brochure refers to ‘Builder (includes all residential and building trade work)’. This is the category into which the applicant’s application fell.
31 The applicant did not hold any of the qualifications set out under the heading “Acceptable Qualifications & Experience” on page 1 of Form L20. Consequently the administrator required the applicant to satisfy the requirements under the heading “Building Industry Skills Centre (BISC) Written Technical Examination” on page 2 of Form L20. It provides:
“Applicants not holding any of the listed acceptable qualifications may still qualify for issue of a Contractor Licence/Qualified Supervisors Certificate as a builder by successfully completing the BISC Written Technical Examination provided they satisfy the guidelines for entry into the examination.”
“The applicant holds TAFE (or equivalent) Trade Course Certificate in the trades of Carpentry and Joinery … and can show ten years relevant post trade experience”.
The guideline for entry relevant to the applicant states:
32 The applicant undertook the BISC examination at Newcastle in November 1998. He was required to pass in both Parts of the examination. He passed Part A but failed Part B dealing with Quantity Surveying and Estimating. He undertook Part B of the examination again in March 1999, but again failed.
The Circumstances
33 As noted earlier, the administrator advised the applicant (by letter dated 30 March 1999) that as he had failed the examination twice his application was refused. As also noted earlier, he sought internal review and by letter dated 27 April 1999 the administrator advised that it affirmed its previous decision.
34 The letter gave the following reasons for refusal:
“[Y]ou have been unsuccessful in two attempts at the Written Technical Examinations conducted by the TAFE Building Industry Skills Centre (BISC) on behalf of the Department. The BISC, as a recognised industry training provider, conducts assessments and provides notification of the results of those assessments to the Department to assist in the determining of applications. The Department accepts the BISC’s adjudication on the results notified to the Department.”
35 In his submission to the internal review, which he relies on in these proceedings, the applicant referred to two matters. He emphasised his long involvement in the building industry, mainly in Queensland and more recently in New South Wales. (His application for variation included a number of references referring to his good character and the quality of his work.) He mentioned that his (late) father and two brothers were in the industry.
36 In addition, he criticised the circumstances of the written examination. He felt that the two-hour time limit did not replicate experience in the field. He said that he was careful in assessing quantities and making estimates. He also criticised the units of measurement chosen to be used as the basis for one of the problems. He said the units chosen also did not replicate usual practice as he had experienced it.
Assessment
37 The obligation of this Tribunal is to make the ‘correct and preferable decision’ having regard to all the circumstances (Tribunal Act s 63). The regulatory scheme makes it clear that the administrator is required to set appropriate standards and requirements for the administration of licensing.
38 In this case the general character and quality of the experience of the applicant are not in issue. The administrator’s only ground for refusal is that the applicant has failed the prescribed requirement of a written technical examination.
39 The applicant’s submission could possibly be construed as seeking to challenge the imposition of an examination requirement on persons with his degree of experience in the industry. The administrator addressed such a submission and referred to s 20(5), which provides that:
“A decision of the Director-General relating to determining standards or other requirements … cannot be reviewed by the Administrative Decisions Tribunal in an application for review made under this Act.”
40 In Ghersinich v Building Services Corporation (unreported, 21 October 1992) the Commercial Tribunal (the external review forum prior to the transfer of jurisdiction to this Tribunal), construed an earlier version of s 20(5) expressed in similar terms. It decided that the matters set out in the version of Form L20 then in circulation constituted ‘standards or requirements’ as distinct from mere guidelines. Consequently the Tribunal could not review a decision of the administrator relating to the determination of standards or requirements.
41 As the standards prescribed can not be challenged, it follows that it is not permissible to ask the Tribunal somehow to re-appraise the mark given to the applicant or, even more so, to appraise (as the applicant appears to urge) the academic choices made by the examiners in determining the time-span of the examination or the units of measurement provided for some problems. A similar view was adopted in Clarke v Building Services Corporation (1992) 1 NSWBLR 33 where the Commercial Tribunal held that the administrator’s exercise of judgment in relation to the grading and quality of the applicant’s examination performance can not be re-agitated; and that it must be treated in the same way as a result or certificate issued by a tertiary institution.
42 The administrator also referred to s 20(3) of the Act which provides relevantly:
“The Director-General must reject an application for a licence if:
43 The administrator submits that the Tribunal is obliged, like the administrator under s 20(3) to reject the application on the basis that it does not conform to the standards. I agree that this is so, where there is no discretionary content contained within the standard in issue; and that that is the case here.
(a) the Director-General is not satisfied that any such requirement would be met were the licence to be issued, or
(b) …”.
44 But as noted in the series of decisions in the Commercial Tribunal reviewed in Vasilopoulos v Director-General, Department of Fair Trading (unreported, 12 February 1998), an applicable standard may itself have a discretionary component. It may also be open to this Tribunal not to regard itself as bound by a prescriptive standard that is unlawful: see further the discussion in Doyle v Commissioner of Police [1999] NSWADT 84 at [19] to [37]. This case does not fall into either of those categories.
45 The applicant failed to meet the standard set by the administrator for variations to endorsed licences. I am satisfied that the administrator’s refusal was the correct and preferable decision.
Determination
46 The decision under review is affirmed.
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