Johnston and Commissioner of the NDIS Quality and Safeguards Commission
[2024] AATA 3438
•30 September 2024
Johnston and Commissioner of the NDIS Quality and Safeguards Commission [2024] AATA 3438 (30 September 2024)
Division:NATIONAL DISABILITY INSURANCE SCHEME DIVISION
File Number: 2023/2477
Re:Simon Johnston
APPLICANT
AndCommissioner of the NDIS Quality and Safeguards Commission
RESPONDENT
DECISION
Tribunal:Senior Member D Katter
Date:30 September 2024
Place:Brisbane
The decision under review is affirmed.
................[SGD]................
Senior Member D Katter
Catchwords
NATIONAL DISABILITY INSURANCE SCHEME – National Disability Insurance Scheme Act 2013 (Cth) – section 73ZN – decision under review affirmed
Legislation
Administrative Appeals Tribunal Act 1975 (Cth)
National Disability Insurance Scheme Act 2013 (Cth)
National Disability Insurance Scheme (Quality and Safeguards Commission and Other Measures) Transitional Rules 2018 (Cth)
Cases
Downey v Pryor (1960) 103 CLR 353
REASONS FOR DECISION
Senior Member Katter
30 September 2024
This is an application for review[1] of an internal review decision[2] made by the Respondent to vary a decision to make a ‘Banning Order’ as to the Applicant.[3]
[1] Exhibit 1, page 1.
[2] Exhibit 1, T2, page 24.
[3] Exhibit 1, T2, page 26.
An application for renewal of registration with the Respondent was submitted by ‘the trustee for the Johnston Family Trust trading as My Healthy Mind’ on 14 February 2020.[4]
[4] Exhibit 1, pages 34 and 243.
There is a ‘notice of internal review decision’ dated 13 April 2023:[5]
[5] Exhibit 1, T2, page 24.
‘I refer to your request received by the NDIS Quality and Safeguards Commission … on 1 March 2022 requesting a review of the decision dated 25 February 2022 to make a banning order against you for a period of six years under section 73ZN(2)(a)(iii) of the [National Disability Insurance Scheme Act 2013 (Cth) (the “Act”)]. …
I am a delegate of the NDIS Commissioner for the purposes of section 100 of the … Act, and am authorised to make a decision on your request for internal review.
The internal review decision
I have decided to vary the original decision. I have decided that the banning order against you will remain in place, however I have varied the banning order period such that you are prohibited from being involved in the provision of supports and services, directly or indirectly, to NDIS participants until 14 March 2027.
I enclose the banning order as varied and the reasons for my review decision at Attachment A to this notice.
Consequences of review decision
The effect of my review decision is that the banning order against you remains in place and you are prohibited from being involved in the provision of supports and services, directly or indirectly, to NDIS participants, effective from 5pm on 28 February 2022 until 14 March 2027.
Engaging in conduct that breaches a banning order is a contravention of section 73ZN(10) of the … Act. Contravention of a banning order attracts a civil penalty of 1,000 penalty units for an individual ($275,000).
External review rights
If you are dissatisfied with my review decision, you may apply to the Administrative Appeals Tribunal … for a review of the decision. You must apply within 28 days after receiving this notice of decision. …
Variation or revocation of banning order
Section 73ZO of the … Act allows the NDIS Commissioner to vary or revoke a banning order at any time, on her own initiative, or in response to an application by the person against whom the order was made. If you are minded to request a variation or revocation of the banning order against you, an application must be in accordance with the matters set out in section 73ZO of the … Act.’
There is a document headed ‘section 73ZN Banning Order’ (the ‘banning order’):[6]
‘ … as delegate of the Commissioner of the NDIS Quality and Safeguards Commission under the … Act … , make this banning order with respect to Simon Richard Johnston.
I make the order believing on reasonable grounds that Simon Richard Johnston is not suitable to be involved in the provision of supports or services to people with disability.
Pursuant to section 73ZN(2)(a)(iii) of the … Act, I prohibit Simon Richard Johnston from being involved in the provision of supports and services, directly or indirectly, to NDIS participants until 14 March 2027 at 00:01 (AEST), effective from 28 February 2022 at 5:00pm (AEST).
My reasons for making this order are set out in the enclosed statement of reasons.
This order takes effect on 28 February 2022 at 5:00pm (AEST). …
General Counsel and Assistant Commissioner, Legal Services and Internal Integrity Delegate of the NDIS Quality and Safeguards Commissioner
13 April 2023’
[6] Exhibit 1, T2, page 26.
The Applicant applied to the Tribunal to review the decision of the Respondent dated
13 April 2023.[7]
[7] Exhibit 1, page 1.
Section 73ZN of the Act, as referred to in the “banning order”,[8] states:
[8] Exhibit 1, T2, page 26.
‘Banning orders--NDIS providers
(1) The Commissioner may, by written notice, make an order (a banning order) prohibiting or restricting specified activities by an NDIS provider, or by a person who was an NDIS provider, if:
(a)the Commissioner has revoked the registration of the person as a registered NDIS provider; or
(b)the Commissioner reasonably believes that:
(i) the person has contravened, is contravening, or is likely to contravene this Act; or
(ii) the person has been involved in, or is likely to become involved in, a contravention of this Act by another person; or
(iii) the person is not suitable to provide supports or services to people with disability, having regard to any matters prescribed by the National Disability Insurance Scheme rules for the purposes of this subparagraph; or
(iv) in the case of an NDIS provider--there is an immediate danger to the health, safety or wellbeing of a person with disability if the person continues to be an NDIS provider; or
(c)the person is convicted of an offence involving fraud or dishonesty; or
(d)the person becomes an insolvent under administration.
Note: A person who is subject to a banning order cannot be registered as an NDIS provider in a way that is inconsistent with the order (see subsection 73E(3)).
Banning orders--persons employed or otherwise engaged by NDIS providers or key personnel of NDIS providers
2The Commissioner may, by written notice, make an order (a banning order) prohibiting or restricting a person who is or was employed or otherwise engaged by an NDIS provider, or a person who is or was a member of the key personnel of an NDIS provider, from engaging in specified activities if:
(a)the Commissioner reasonably believes that:
(i) the person has contravened, is contravening, or is likely to contravene this Act; or
(ii) the person has been involved in, or is likely to become involved in, a contravention of this Act by another person; or
(iii) the person is not suitable to be involved in the provision of supports or services to people with disability, having regard to any matters prescribed by the National Disability Insurance Scheme rules for the purposes of this subparagraph; or
(iv) there is an immediate danger to the health, safety or wellbeing of a person with disability if the person continues to engage in the specified activities; or
(b)the person is convicted of an offence involving fraud or dishonesty; or
(c)the person becomes an insolvent under administration.
Banning orders--persons not suitable to be involved in provision of supports or services to people with disability
(2A) The Commissioner may, by written notice, make an order (a banning order) prohibiting or restricting a person from being involved in the provision of specified supports or specified services to people with disability if:
(a)the Commissioner reasonably believes that the person is not suitable to be so involved, having regard to any matters prescribed by the National Disability Insurance Scheme rules for the purposes of this paragraph; and
(b)the person has not previously been an NDIS provider; and
(c)the person has not previously been employed or otherwise engaged by an NDIS provider; and
(d)the person has not previously been a member of the key personnel of an NDIS provider.
Application of banning orders
(3) A banning order may:
(a)apply generally or may be of limited application; and
(b)be permanent or for a specified period; and
(c)be made subject to specified conditions.
(4) However, a banning order cannot prohibit or restrict activities that a registered NDIS provider is registered to provide under 73E.
(5) A banning order takes effect from the day specified in the order.
(5A) If a banning order under subsection (2) is made against a person who is employed or otherwise engaged by an NDIS provider, the continuity of the order is not affected by the employment or engagement ceasing.
(5B) If a banning order under subsection (2) is made against a person who is a member of the key personnel of an NDIS provider, the continuity of the order is not affected by the person ceasing to be such a member.
(6) A banning order is not a legislative instrument.
Process
(7) The Commissioner may only make a banning order against a person after giving the person an opportunity to make submissions to the Commissioner on the matter.
(8) However, subsection (7) does not apply if the Commissioner's grounds for making the banning order are, or include, the following:
(a)that there is an immediate danger to the health, safety or wellbeing of a person with disability;
(b)that the Commissioner has revoked the registration of the person as a registered NDIS provider.
(9) The Commissioner must:
(a)give the banning order to the person against whom the order is made; and
(b)include in the banning order a statement of reasons for the order; and
(c)if the banning order is against a person who is employed or otherwise engaged by an NDIS provider or is a member of the key personnel of an NDIS provider--notify the NDIS provider of the order as soon as possible.
Civil penalty
(10) A person contravenes this subsection if:
(a)the person engages in conduct; and
(b)the conduct breaches a banning order (including a condition of the order) that has been made against the person.
Civil Penalty: 1,000 penalty units.’
The ‘banning order’ document,[9] refers specifically to section 73ZN(2)(a)(iii), which states that the Commissioner may, by written notice, make an order prohibiting or restricting a person who is or was employed or otherwise engaged by a NDIS provider or a person who is or was a member of the key personnel of a NDIS provider, from engaging in specified activities if the Commissioner reasonably believes that the person is not suitable to be involved in the provision of supports or services to people with disability, having regard to any matters prescribed by the National Disability Insurance Scheme rules for the purposes of this sub-paragraph.
[9] Exhibit 1, T2, page 26.
Section 99 of the Act is headed ‘Reviewable decisions and decision–makers’ and has a table which ‘sets out the reviewable decisions under the Act’. Item 15 of the table refers to ‘a decision to make a banning order’ and lists the ‘Commissioner’ as the decision-maker, referring to section 73ZN of the Act.
Section 73ZN(2) of the Act refers to ‘the Commissioner’. Section 9 of the Act states that in the Act the ‘Commissioner’ ‘means ‘the Commissioner of the NDIS Quality and Safeguards Commission referred to in section 181C’. Section 181C of the Act states that there is to be a Commissioner of the NDIS Quality and Safeguards Commission. The document referred to above, stated to be a ‘banning order’,[10] dated 13 April 2023, states that it is signed by a delegate of the NDIS Quality and Safeguards Commissioner. There was no issue taken by the Applicant as to the stated delegation of the Commissioner in that document dated
13 April 2023.
[10] Exhibit 1, T2, page 26.
There was ‘written notice’ by the document of 13 April 2023,[11] as ‘given’ to the Applicant.[12] There is no definition of the word ‘order’ in section 9 of the Act. In section 9 of the Act the phrase ‘banning order’ as included within the parentheses in section 73ZN(2) means ‘an order made under section 73ZN’.
[11] Exhibit 1, T2, page 26.
[12] Section 73ZN(9) of the Act.
The Respondent submits that the Applicant ‘is or was a member of the key personnel of an NDIS provider’.[13] A ‘NDIS provider’ is defined in section 9 of the Act:
[13] Transcript, 5 March 2024, P-11 lines 17-26.
‘"NDIS provider" means:
(a)a person (other than the Agency) who receives:
(i) funding under the arrangements set out in Chapter 2; or
(ii) NDIS amounts (other than as a participant); or
(b) a person or entity:
(i) who provides supports or services to people with disability other than under the National Disability Insurance Scheme; and
(ii) who is prescribed by the National Disability Insurance Scheme rules for the purposes of this subparagraph.’
In section 9 of the Act, the phrase ‘key personnel’ is stated to have the meaning given by section 11A:
‘Definition of key personnel
1Each of the following is one of the key personnel of a person or entity:
(a)a member of the group of persons who is responsible for the executive decisions of the person or entity;
(b)any other person who has authority or responsibility for (or significant influence over) planning, directing or controlling the activities of the person or entity.
2Without limiting paragraph (1)(a), a reference in that paragraph to a person who is responsible for the executive decisions of a person or entity includes:
(a)if the person or entity is a body corporate that is incorporated, or taken to be incorporated, under the Corporations Act 2001 - a director of the body corporate for the purposes of that Act; and
(b)in any other case - a member of the person's or entity's governing body.’
The Respondent submitted that there was no contention by either party that the Applicant was not ‘a member of the key personnel of a NDIS provider’[14]. The Applicant did not make any contrary submissions as to the phrase ‘key personnel’ not being applicable to the Applicant[15]. As to the ‘person or entity’ by whom the Applicant was ‘employed or otherwise engaged’, the Respondent referred to ‘My Healthy Minds’[16]. The Respondent submitted that the Applicant ‘was the (sole) trustee director for the Trustee for the Johnston Family Trust, which traded as My Healthy Minds’.[17] The Respondent referred to a ‘Details for ABN’ document, which states that ‘The Trustee for the Johnston Family Trust’ had the business name ‘My Healthy Mind’ and included under the heading ‘authorised contacts’, ‘MR Simon Johnston’, whose position is stated as ‘Trustee Director’.[18] The Respondent referred to ‘My Healthy Minds’ as being a ‘transitioned provider’[19]. The National Disability Insurance Scheme (Quality and Safeguards Commission and Other Measures) Transitional Rules 2018 (Cth) state at section 7(4) that ‘a person or entity who is a registered NDIS provider under the Act because of paragraph (2)(b) of this section is a transitioned provider’. Accordingly, the Applicant is a person who is or was a member of the key personnel of an NDIS provider.
[14] Transcript, 5 March 2024, P-11 lines 15-27.
[15] Transcript, 5 March 2024, P-23 lines 29-30.
[16] Closing Submissions of the Respondent, page 3, paragraph 8.
[17] Closing Submissions of the Respondent, page 3, paragraph 8.
[18] Exhibit 1, T3, pages 150 and 151.
[19] Exhibit 1, page 265.
Section 73ZN(2)(a)(iii) includes the phrase ‘that the person is not suitable to be involved in the provision of supports or services to people with disability…’. The words and phrases used in that phrase are not defined in section 9 of the Act, except that ‘supports’ includes ‘general supports’. There is then in sub-paragraph (iii) a comma followed by the words: ‘ … having regard to any matters prescribed by the National Disability Insurance Scheme rules for the purposes of this subparagraph.’ The parties did not submit that there are rules prescribed expressly for section 73ZN(2)(a)(iii) of the Act.[20] The Applicant submitted that where there are no rules for the purposes of that sub-paragraph, the sub-paragraph ‘does not stand up at the Tribunal. It’s not binding at the Tribunal’[21]. The Respondent submitted that ‘it is appropriate to essentially read out the words after the [comma] in subparagraph (iii)’[22]. The Respondent submitted that the phrase ‘having regard to’ ‘ … prescribe[s] matters relevant to the decision maker’s consideration of a person’s suitability; [it does] not impose a condition precedent upon the exercise of power’.[23] The Respondent submitted that the ‘position was explained’ in Downey v Pryor (1960) 103 CLR 353[24]:
‘Upon consideration of the words themselves, the context, and the nature of the provision, the intention may appear that a prescribed method is of the essence of the authority, so that there is no authority capable of exercise at any given time unless at that time a valid prescription of a method is in force … But on the other hand the meaning may be that the authority is to be subject to a power in the Executive to regulate its exercise and that in the reference to the prescribed method the words “if any” are to be implied … In the latter class of cases, a person exercising the authority must observe any method which is prescribed for the time being; but if none is prescribed the authority is exercisable by any appropriate method … ‘
[20] See Closing Submissions of the Respondent, page 3, paragraph 13.
[21] Transcript, 10 April 2024, P-66 lines 1-2.
[22] Closing Submissions of the Respondent, dated 18 March 2024, paragraph 13.
[23] Closing Submissions of the Respondent, dated 18 March 2024, paragraph 14.
[24] Downey v Pryor (1960) 103 CLR 353, at 361-2 per Kitto J.
It was also stated in Downey that:[25]
‘In my view the words “as prescribed” that appear, somewhat clumsily, in s 215 of the Local Government Act 1919 do not make that section depend for its effectual operation on something being prescribed. This is not, it seems to me, a case where a prescription of something pursuant to a statute is necessary to complete a statutory right. It is rather a case of the statute recognizing that a right given by it may be further defined, or its exercise regulated, by ordinance.’
[25] Downey v Pryor (1960) 103 CLR 353, at 364 per Windeyer J.
The Respondent submits that the ‘position is even clearer [as to section 73ZN(2)(a)(iii)], because it is not strictly necessary to read the words, if any, into’ the sub-paragraph and the ‘provision already contemplates that there may in fact be no prescribed rules and only requires the decision-maker to have regard to “any” matters prescribed by the National Disability Insurance Scheme rules’.[26]
[26] Closing Submissions of the Respondent, dated 18 March 2024, paragraph 15.
The phrase ‘ … , having regard to any matters prescribed by the National Disability Insurance Scheme rules for the purposes of this subparagraph’ used in section 73ZN(2)(a)(iii) is of the kind referred to above by Windeyer J, and of the latter kind referred to above by Kitto J, in that the prescription of rules is not necessary for the operation of that sub-paragraph; if no rules are prescribed for the sub-paragraph ‘the authority is exercisable by any appropriate method’.[27]
[27] Downey v Pryor (1960) 103 CLR 353, at 361-2 per Kitto J.
Section 73ZN(2)(a)(iii), as referred to above, includes the phrase ‘is not suitable to be involved in the provision of supports or services to people with disability’. In the statement of reasons as to the internal review decision, the following was stated:[28]
[28] Exhibit 1, T2, pages 33-34.
‘ … 37. According to the evidence before me, on 7 December 2016, Mr Johnston was issued with a notice from the Ministry of Business, Innovation and Employment in New Zealand, prohibiting him from being a director of, or being concerned in taking part, whether directly or indirectly, in the management of any company in New Zealand for a period of seven years and six months from 7 December 2016.
35. Further, on 13 March 2017, Mr Johnston was found guilty of accepting payment and failing to supply goods or services under subsections 158(7)(a) and (b)(ii) of the Australian Consumer Law (ACL).
36. Mr Johnston did not disclose either of these matters to the NDIS Commission as part of the renewal application for MHM in his response to the suitability assessment question above.
37. Through his legal representatives, Mr Johnston has previously submitted that he misunderstood the relevant question in the suitability assessment and had interpreted it to mean regulatory actions in relation to services provided to people with disability only.
38. In relation to Mr Johnston's prohibition from directing and managing companies in New Zealand, Ms Mullighan has submitted that the statements made by the Deputy Registrar in that matter are emphatically denied by Mr Johnston. Mr Johnston says that his company was being run by a colleague and it was the colleague that engaged in the action's causative of the prohibition order.
39. In relation to the convictions under the ACL, submissions made by Ms Mullighan states:
• The conviction involved a number of building contracts for which insurances covered the losses of his clients. The only party financially affected was Mr Johnston;
• The matter was incorrectly heard by the Office of Fair Trading and should have been dealt with before the Queensland Building and Construction Commission, who Mr Johnston contends would have dealt with the matter appropriately by dismissing it in light of the insurances that covered the losses of his clients;
• Mr Johnston was in poor health at the time the conviction was made, to the extent that he did not enter a plea;
• The conviction was more than five years ago and Mr Johnston has put in place successful business practices since then;
• The conviction has been spent and should have no bearing on Mr Johnston's suitability; and
• That the NDIS Commission was already aware of the convictions, and that it is manifestly unfair to raise this issue again in the context of the banning order.’
The Applicant is named on a document described as a ‘Ministry of Business Innovation & Employment’ ‘Companies Act 1993 section 385 notice prohibiting a person from managing companies’.[29] That document is dated 7 December 2016 ‘at Wellington’ and states that it is signed by the Deputy Registrar of Companies.[30] ‘Pursuant to section 385(3) of the Companies Act 1993, I, Peter Barker, Deputy Registrar of Companies, hereby prohibit SIMON RICHARD JOHNSTON from being a director or promoter of, or being concerned in or taking part, whether directly or indirectly, in the management of any company for a period of seven years + six months as from the date of this notice.’ There is a document headed ‘Minute section 385 Companies Act 1993 – Simon Richard Johnston Minute of Deputy Registrar of Companies’.[31] That document is dated 7 December 2016.[32] Paragraph 9.6 of that Minute document states:[33] ‘I consider the nature and extent of the mismanagement to be serious. Mr Johnston seems to have ignored basic duties required of a company director. The failure of Mr Johnston is just as damming whether it was done deliberately or in ignorance.’ Paragraph 12.6 of that Minute document states:[34]
‘I regard the breaches as much more serious than being, in MBIE’s words, “unreasonable.” Where a director uses company funds for personal expenditure when the Company is insolvent that amounts to theft. It shows a complete lack of understanding of the difference between operating a business through a company having a separate legal identity to the director. A director cannot use the Company as his personal cashbox particularly when the Company is insolvent.’
[29] Exhibit 1, T3, page 108.
[30] Exhibit 1, T3, page 108.
[31] Exhibit 1, T3, pages 110-119.
[32] Exhibit 1, T3, page 119.
[33] Exhibit 1, T3, page 115.
[34] Exhibit 1 T3, page 98.
The Respondent submitted:[35]
[35] Closing Submissions of the Respondent, pages 9-11, paragraphs 38.1-39.
‘ … the [A]pplicant’s company was incorporated in March 2013 and was placed in liquidation in September 2014. During that time, it owed the Inland Revenue Department approximately $23,565, and failed to file GST and PAYE returns after
September 2013.[[36]] The total indebtedness of the Company was approximately
[36] R1, page 113, paragraphs 8.2-8.3.
$326,000 and "there were very few realisable assets.[[37]]
[37] R1, page 115, paragraph 9.5.
… the [A]pplicant engaged in reckless trading, and there was "mismanagement and
that it was at least a partial reason for the failure of the Company".[[38]]The Deputy
[38] R1, page 113, paragraph 8.4.
Registrar also found that the "overall attitude of the [Applicant] expressed through
the failure to file returns, and the trend, is serious".[[39]]The Deputy Registrar made,
[39] R1, page 114, paragraph 8.9.
with respect, the obvious point that "[p]ersons who cannot be trusted to fulfil
statutory obligations should not be a company director".[[40]]
… the [A]pplicant engaged in insolvent trading. The Deputy Registrar concluded that the [A]pplicant “seems to have ignored basic duties required of a company director. The failure of [the Applicant] is just as damning whether it was done deliberately or in ignorance”.[[41]]
… the [A]pplicant failed to keep proper accounting records. The Deputy Registrar found that the accounting records were "inadequate", and referred to a person resigning from the company because "she was not comfortable with the situation".[[42]] The Deputy Registrar also noted that the information supported the liquidators' assessment "that the taking of deposits for sheds that could not realistically be built was a scam".[[43]]
… the [A]pplicant … failed to act in good faith and in the best interests of the company. The Deputy Registrar noted that the [A]pplicant's shareholder account was overdrawn by $92,587, and considered this to be "much more serious than ...
unreasonable".[[44]]
… in exercising the discretion to prohibit the [A]pplicant, the Deputy Registrar said … :
I consider that [the Applicant] has no understanding at all of his duties to creditors, nor of his duties and obligations generally. I consider [the Applicant's] mismanagement to be very serious for the reasons set out earlier in this Minute. I consider [the Applicant] to be a menace to the public and the public requires protection from [the Applicant]. This conclusion is reinforced when the materials show that [the Applicant] is being prosecuted by the Office of Fair Trading in Australia for a very similar pattern of trading by taking money to perform goods and services and failing to supply them in a reasonable time.
… plainly, the [A]pplicant’s business dealings in New Zealand were unsatisfactory. On the basis of the matters set out in the Minute, the [A]pplicant was involved in a scam or a grift whereby he took deposits for sheds which he could not realistically build. [The Applicant] failed to pay creditors, including the tax department, failed to lodge tax documents, failed to keep proper records, and withdrew money from the company for a personal use at a point in time when the company was insolvent. These are matters which clearly bear upon the applicant's suitability to be an NDIS provider, as they clearly undermine his integrity, honesty and probity.’
[40] R1, page 114, paragraph 8.7.
[41] R1, page 115, paragraph 9.6.
[42] R1, page 116, paragraph 10.7.
[43] R1, page 116, paragraph 10.9.
[44] R1, page 117, paragraphs 12.1-12.6.
At the hearing, the Applicant stated:[45]
‘ … I was never based and living in New Zealand, no.
… did you have a company there? --- Yes, I did. Was I based there? No.
… you’re aware that the Deputy Registrar of Companies in New Zealand prepared a decision in relation to your business dealings in New Zealand? --- Yes, I am aware of that. …
You were aware that your company had gone into liquidation in New Zealand? --- Correct. I put it into liquidation myself.
How much did your company owe when it went into liquidation? --- I have no idea.
… So your evidence … is that you were just … never made aware of any of the investigations from the Ministry for Business, Innovation and Employment in New Zealand? --- That’s correct.’
[45] Transcript of proceedings 5 March 2024, pages 31-34.
There is a document headed ‘Verdict and Judgment Record form 44 rule 62 Criminal Practice Rules … Magistrates Court of Queensland at Southport’.[46] The ‘ordered person’ on that document is ‘Simon Richard Johnston’.[47] The ‘date of judgment or order’ is
13 March 2017.[48] The document is signed and has a Magistrates Court Southport stamp on it and is dated 29 August 2019[49]. The document states:[50]
‘Complaint And Summons (Charge)
[46] Exhibit 1, T3, page 107.
[47] Exhibit 1, T3, page 107.
[48] Exhibit 1, T3, page 107.
[49] Exhibit 1, T3, page 107.
[50] Exhibit 1, T3, page 107.
Chg
Offence
Section/Statute
Date of Offence
Plea
Plea Date
Verdict/Result
V/R Date
1
ACCEPT PAYMENT AND FAIL TO SUPPLY GOODS OR SERVICES WITHIN A REASONABLE TIME
158(7)(A)&(B)(II) – AUSTRALIAN CONSUMER LAW
ON 05/10/2016
NO PLEA
13/03/2017
EX PARTE
13/03/2017
Judgment or Order of the Court
MONETARY (ADULT) – Conviction recorded
The court ordered that SIMON RCHARD JOHNSTON pay the following:
FINE: $13,000.00
Total Amount Ordered: $13,000.00
Due Date for Payment: 2 Months
In Default of Payment: Nil Default
MONETARY (ADULT) – Conviction recorded
The court ordered that SIMON RCHARD JOHNSTON pay the following:
COSTS OF COURT: $89.40
RESTITUTION: $3,765.00
Total Amount Ordered: $3,854.40
Due Date for Payment: 2 Months
In Default of Payment: Nil Default’
The Respondent submitted[51]:
‘The [A]pplicant was fined $13,000 and ordered to pay compensation across the 4 matters in the total of $24,495.37.[[52]] The summary of prosecution facts, which was taken into account by the Magistrate when sentencing the [A]pplicant, demonstrated that the [A]pplicant accepted payment for goods and services “being the construction of alloy and steel storage sheds and one alloy and steel carport” and failed to supply those goods at all. The company was in operation from August 2013 to December 2015. The prosecutor said … :[[53]]
The defendants did engage in behaviour that was evasive and deceptive with respect to advising those particular victims as to when their services and goods would be delivered, if they were to be delivered, and at the end of the day he was uncontactable by the victims in the matter to try and establish whether or not they were going to get any redress, any refund or any service or goods delivered. …
These Australian convictions support the probity concerns with the [A]pplicant’s business dealings. They again demonstrate essentially a scam – whereby the [A]pplicant takes money for the construction of sheds and does not deliver the service – and then fails to account or take responsibility at all for the conduct. …
Both the Australian and the New Zealand matters reflect very poorly on the [A]pplicant’s character. It is one thing to have a business which fails. But the [A]pplicant’s management of that business’ failings was wholly unsatisfactory. [The Applicant] did not keep proper records, did not pay his debts or compensate the customers, and did not communicate with his customers. In each case, a regulator became involved, and the [A]pplicant did not engage with the regulator either. … That is not behaviour consonant with a person suitable to be involved in the provision of supports or services to people with disability.’
[51] Exhibit 1, T3, pages 12-13.
[52] Comprised of three separate compensation orders of $3,765, $43,232 and $16,498.37: R1 15.
[53] R1 9, lines 34-38.
At the hearing, the Applicant stated:[54]
‘What’s your understanding of why you were convicted of offences in Queensland in 2017? --- Well, my understanding of it is that we had sold some metal frame sheds that we were supposed to erect. In between times while we were waiting for the council approvals I was working for a company called Contract Build, that we were contracting to. We’d done three months of work for that company, of which we never got paid a dollar for, and I ran short of funds and couldn’t complete the contracts.
When you couldn’t complete the contracts did you discuss the issues that you were having with your clients? --- Well, each of those contracts had QBCC insurance.
Did you engage with the insurer? --- The QBCC are aware of it, yes.
Did you tell the clients of their possible recourse to insurance? --- And Fair Trading [k]new also.
But you told the clients of their possible recourse to insurance? --- I didn’t need to tell the clients … . They already knew because it’s issued as part of the paperwork.”
[54] Transcript, 5 March 2024, P-35.
In the statement of reasons as to the internal review decision, the following was stated:[55]
‘35. Mr Johnston was the sole key personnel for MHM. In his capacity as key personnel, Mr Johnston made an application to the NDIS Commission to renew the registration of MHM. When assessing an applicant seeking registration (including renewal of registration), the NDIS Commissioner must be satisfied that the [A]pplicant, and the [A]pplicant’s key personnel, are suitable to provide supports or services to people with disability. Therefore, as part of MHM's renewal application, Mr Johnston completed a 'suitability assessment', dated 14 February 2020. Amongst others, the suitability assessment contained the following question:
Has the Applicant or any of the Applicant's Officeholders been the subject of any investigation, adverse findings or enforcement by any regulator, including authorities responsible for the quality or regulation of services for people with disability?
36. Mr Johnston responded 'no' to this question.’
[55] Exhibit 1, T2, pages 33-34.
At the hearing the Applicant recalled ‘filling in’ a suitability assessment when applying for registration of My Healthy Mind as a NDIS provider.[56] The Applicant stated that he ‘did not know about the New Zealand matters’ at the time when he filled in the suitability assessment document.[57] The Applicant stated that the question as to adverse findings was ‘limited to the provision of services for people with disability’.[58] The Applicant stated that he didn’t know he had the Queensland conviction or convictions when he answered the question in 2019.[59]
[56] Transcript, 5 March 2024, P-36, lines 31-33.
[57] Transcript, 5 March 2024, P-37, lines 16 and 17.
[58] Transcript, 5 March 2024, P-39, lines 13-15.
[59] Transcript, 5 March 2024, P-40, lines 17 and 18.
There was on the documents, as referred to above, available on 13 April 2023, a ‘reasonable belief’ that the Applicant is not suitable to be involved in the provision of supports or services to people with disability. The ‘section 385 Companies Act 1993 (NZ) notice’[60] and the Queensland Magistrates Court conviction[61] are a basis for ‘reasonable belief’ that the Applicant is not suitable to be involved in the provision of supports or services to people with disability. There is, having regard to the circumstances referred to above, a ‘reasonable belief’ that the Applicant is not suitable to be involved in the provision of supports or services to people with disability.
[60] Exhibit 1, T3, page 108.
[61] Exhibit 1, T3, page 107.
There is, therefore, a ‘reasonable belief’ that there is a basis for the discretion (‘may’) to make an order (‘banning order’). The order prohibited or restricted the Applicant as a person who is or was a member of the key personnel of a NDIS provider from ‘being involved in the provision of supports or services, directly or indirectly, to NDIS participants’.[62] The ‘written notice made an order prohibiting or restricting the Applicant as a person who is or was a member of the key personnel of an NDIS provider from engaging in specified activities.’ Section 9 of the Act does not define the phrase ‘engaging in specified activities’ or the words within that phrase. The parties did not contend or submit that there was any issue as to the specification of the activities in the ‘banning order’ dated 13 April 2023.
[62] Exhibit 1, T2, page 26.
The order dated 13 April 2023 was a written notice prohibiting or restricting the Applicant who is or was a member of the key personnel of a NDIS provider from engaging in specified activities where there is reasonable belief that the Applicant was not suitable to be involved in the provision of supports or services to people with disability as stated in section 73ZN(a)(iii) of the Act.
DECISION ON REVIEW
The decision under review of 13 April 2023[63] is affirmed[64].
[63] Exhibit 1, T2, page 26.
[64] Section 43(1)(a), Administrative Appeals Tribunal Act 1975 (Cth).
| I certify that the preceding 30 (thirty) paragraphs are a true copy of the reasons for the decision herein of Senior Member D Katter |
.................[SGD]................
Associate
Dated: 30 September 2024
Dates of hearing: 5 March and 10 April 2024 Representation for the Applicant: Self-represented Counsel for the Respondent: Mr J. Barrington
Solicitors for the Respondent: Australian Government Solicitor
0
1
0