Keast v Excalibur Property Services Pty Ltd & Wilkes

[2010] QCAT 512

CITATION:Keast v Excalibur Property Services Pty Ltd & Wilkes [2010] QCAT 512

PARTIES:	Mrs Denise Keast
v
Excalibur Property Services Pty Ltd Mr Michael Francis Wilkes

APPLICATION NUMBER:   OCL061-10  

MATTER TYPE: Other civil dispute matters

HEARING DATE:     13 October 2010

HEARD AT:  Brisbane

DECISION OF: Ms Susan Gardiner

DELIVERED ON: 13 October 2010

DELIVERED AT:      Brisbane

ORDERS MADE:

1. Pursuant to section 530 of the Property Agents and Motor Dealers Act 2000, the Chief Executive of the Department of Employment, Economic Development and Innovation pay to the applicant Denise Keast the sum of $13,887.43.

2. Pursuant to section 489 of the Property Agents and Motor Dealers Act 2000, the Chief Executive shall not pay the amount until the end of the period allowed for appeal, and if there is an appeal, until the appeal is finally decided.

3. Pursuant to section 488(3)(c) the respondents Excalibur Property Services Pty Ltd and Michael Francis Wilkes are the persons who misapplied in terms of section 470(1)(e) the rental payments and who are liable for the financial loss of the applicant.

4.    Upon payment of the sum of $13,887.43 from the Claim Fund to the applicant, the respondents  Excalibur Property Services Pty Ltd and Michael Francis Wilkes are liable jointly and severally to reimburse the Claim Fund by paying the sum of $13,887.43 to the Chief Executive of Employment, Economic Development and Innovation.

CATCHWORDS :  Property Agents and Motor Dealers Act 2000 s470; claim against fund for misuse of trust funds; real estate agent; claim allowed, real estate agent and company named as persons responsible

REASONS FOR DECISION

1. Excalibur Property Services Pty Ltd was a licensed real estate agent and operated two real estate agencies, Raine and Horne Ascot and Ivan Lazarou Real Estate.  The sole director of Excalibur Property Services Pty Ltd is Michael Francis Wilkes.  Mr Wilkes was also a licensed real estate agent and the sole director of another company, The Art of Property Pty Ltd the registered business name for which is “Elders New Farm”.

2. Ms Denise Keast owns an investment rental property which was managed by Excalibur Property Services Pty.  Between 1 November 2008 and 11 November 2009, Excalibur Property Services Pty Ltd collected rental monies from the tenants in Ms Keast’s property on her behalf.  Ms Keast alleges that some rent payments collected by Excalibur Property Services Pty Ltd during this period were never received by her.  In particular, Ms Keast alleges that between February 2009 and November 2009 no rental monies were transferred into her bank account despite her receiving rental statements from Excalibur Property Services Pty Ltd.  Ms Keast quantified the amount as $13,887.43.

3. On 4 March 2010, Ms Keast lodged a claim against the claim fund set up under the Property Agents and Motor Dealers Act 2000 (PAMDA Act) with the Department of Employment, Economic Development and Innovation (“the Department”). Ms Keast claims the amount referred to above, being the amount of $13,887.43.
4. Notice of that claim was given to Excalibur Property Services Pty Ltd and Mr Wilkes on 29 April 2010.  Twenty-eight days having elapsed from that notice and with no response or settlement being received from any person, on 2 June 2010 Ms Keast gave notice to the Chief Executive that she wished to proceed.  On 4 June 2010 the claim was referred by the Department to this Tribunal for determination. 

Claim

5. The claim is under section 470 of the PAMDA Act. Ms Keast claims to have suffered a financial lost as a result of her dealings with the respondents who held real estate licences under the PAMDA Act. In particular, the claim is for a stealing, misappropriation or misapplication by the relevant persons of property entrusted to the person as agent for someone else in the person’s capacity as a relevant person[1].  It is an offence under the PAMDA Act to dishonestly convert an amount to the licensee’s own or someone else’s use[2].  For these purposes a relevant person is defined as a licensee[3].

[1] section 470(1)(e) of the PAMDA Act

[2] section 573 of the PAMDA Act

[3] section 469 of the PAMDA Act

6. A directions hearing was held on 10 August 2010.  The Tribunal directed that the respondents file and serve any further statements of evidence by 4.00pm on 20 August 2010 and that the application be determined on the papers.  No further material has been received from either respondent.

7. Section 488 of the PAMDA Act sets out the process for deciding the claim.  The Tribunal must be satisfied that:
1. An event as mentioned in section 470(1) happened; and
2. The claimant suffered financial loss because of the event.

8. The Tribunal must also take into account any amount the claimant might reasonably have received or recovered if not for the claimant’s neglect or default[4] and any amount ordered to be paid to the claimant as compensation to the claimant under sections 530A, 572D or 592A of the PAMDA Act[5]. 

[4] section 488(2) of the PAMDA Act

[5] section 488(3 (a) of the PAMDA Act

9. Finally in allowing a claim the Tribunal must decide the amount of the claimant’s financial loss and name the person who is liable for the loss[6].

[6] section 488(3)(b) and (c)  of the PAMDA Act

The Event and the Loss

10. Mr Rohan Youngman was appointed by the Queensland Office of Fair Trading as Receiver over the three trust accounts of Excalibur Property Services Pty Ltd on 2 November 2009[7].   From evidence Mr Wilkes gave to the Receiver, it appears that The Art of Property Pty Ltd (Elders New Farm) had never operated a trust account.

[7] Pursuant to section 417 of the PAMDA Act

11. The conclusion reached by the Receiver in his forensic accounting report dated 12 April 2010 was that the company names and registered business names appeared to have been used interchangeably.  The Receiver made no differentiation between the corporate and business names as they all appeared, in his view, to trade utilizing the three trust accounts.

12. After investigating the claim of Ms Keast for rental monies not received, the Receiver’s 12 April 2010 report concludes:
1. The trust ledger and trust accounts records and documents show that rents were collected by Excalibur over the period October 2008 to January 2010.
2. The trust ledger and trust accounts records and documents show that rental payments, net of commissions and other deductions, were not made to Ms Keast in the amount of $13,887.43.  This amount is tabulated at table 3 in Mr Youngman’s report which shows the liabilities incurred for rental monies which remain unpaid 42 days subsequent to their due date[8] and as at 11 November 2009 (the date at which the trust accounts were frozen under the receivership);
3. As a consequence of the above, Mr Youngman considers Ms Keast’s claim against the fund in the sum of $13,887.43 to be accurate and supported by documentary evidence.

[8] section 385(4) of the PAMDA Act which allows a licensee must pay an amount to the person entitled to it if the person has not asked in writing for the balance within 42 days after the person first had the right to the balance

Other matters to be considered

13. There has been no relevant neglect or default by the claimant identified and no amounts of compensation ordered to be paid under sections 530A, 572D or 592A of the PAMDA Act.

Conclusion

14. The amount owing to Ms Keast by Excalibur Property Services Pty Ltd and Michael Francis Wilkes is found to be $13,887.43. Excalibur Property Services Pty Ltd and Michael Francis Wilkes are relevant persons for the purposes of section 470(1)(e) of the PMADA Act.

15. Excalibur Property Services Pty Ltd and Michael Francis Wilkes are named as the persons who are responsible for this loss.

ORDERS

1. Pursuant to section 530 of the Property Agents and Motor Dealers Act 2000, the Chief Executive of the Department of Employment, Economic Development and Innovation pay to the applicant Denise Keast the sum of $13,887.43.

1. Pursuant to section 489 of the Property Agents and Motor Dealers Act 2000, the Chief Executive shall not pay the amount until the end of the period allowed for appeal, and if there is an appeal, until the appeal is finally decided.

1. Pursuant to section 488(3)(c) the respondents Excalibur Property Services Pty Ltd and Michael Francis Wilkes are the persons who misapplied in terms of section 470(1)(e) the rental payments and who are liable for the financial loss of the applicant.

1. Upon payment of the sum of $13,887.43 from the Claim Fund to the applicants, the respondents  Excalibur Property Services Pty Ltd and Michael Francis Wilkes are liable jointly and severally to reimburse the Claim Fund by paying the sum of $13,887.43 to the Chief Executive of Employment, Economic Development and Innovation.