Khatter v Commissioner for Fair Trading, New South Wales Office of Fair Trading
[2008] NSWADT 161
•6 June 2008
CITATION: Khatter v Commissioner for Fair Trading, New South Wales Office of Fair Trading [2008] NSWADT 161 DIVISION: General Division PARTIES: APPLICANT
RESPONDENT
Sarkis Khatter
Commissioner for Fair Trading, New South Wales Office of Fair TradingFILE NUMBER: 073381 HEARING DATES: 26 March 2008, 15 May 2008 SUBMISSIONS CLOSED: 15 May 2008
DATE OF DECISION:
6 June 2008BEFORE: Higgins S - Judicial Member CATCHWORDS: Home Builder - issue of contractor licence MATTER FOR DECISION: Preliminary matter LEGISLATION CITED: The Home Building Act 1989
The Home Building Regulation 2004CASES CITED: Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321
Commissioner for ACT Revenue v Alpha One Pty Ltd (1994) 49 FCR 589
Director-General, Department of Transport v Z (No.2) (GD) [2002] NSWADTAP 37
Raso v Commissioner for Fair Trading, Office of Fair Trading [2008] NSWADT 51
Barakat v Commissioner for Fair Trading, New South Wales Office of Fair Trading [2008] NSWADT 127
Hughes and Vale Pty Ltd v New South Wales (No.2) (1955) 93 CLR 127
Re Brennan & Australian Casino Surveillance Authority (1995) 38 ALD 794
Re Percival and Australian Securities Commission (1993) 30 ALD 280
Re T and the Director of Use and Community Services [1980] 1 NSWLR 392
Sobey v Commercial and Private Agents Board 20 SASR 70
McBride v Walton (NSW) Court of Appeal, unreported, 15 July 1994
YJ v Chief Executive Officer, WorkCover Authority [2006] NSW ADT 264REPRESENTATION: APPLICANT
RESPONDENT
G Nevin, barrister
W Maynard, solicitorORDERS: 1. On or before Monday 16 June 2008 Mr Khatter to file and serve any additional material on which he seeks to rely in regard to his reputation and character
2. On or before Monday 23 June 2008 the Commissioner to file and serve any material in reply to that which is filed by Mr Khatter
3. Listed for Directions Thursday 26 June 2008 at 2:00pm.
REASONS FOR DECISION
1 Mr Khatter has sought review of a decision of the Commissioner for Fair Trading (‘the Commissioner’) to refuse his application, under the Home Building Act 1989 (‘the Act’), for a contractor licence for the category of ‘electrical’. Mr Khatter had been the holder of such a licence from 1988 to September 2006. This licence was cancelled in 2006 as Mr Khatter had been found to have been involved in a scheme of having obtained a building contractor licence on the presentation of a falsified TAFE Certificate. The scheme was investigated by the Independent Commission Against Corruption (‘ICAC’) during 2004 and 2005. The ICAC found that a TAFE employee had prepared the false certificates for a number of existing licence holders under the Act, who held licences for specialist or other work, but who did not hold a building contractors licence.
2 Mr Khatter was one such applicant and he was issued with a building contractor licence in 2000 on the basis of a false TAFE Certificate of Associate Diploma of Applied Science (Building). Following the ICAC inquiry, on 17 May 2005, the Commissioner decided to cancel Mr Khatter’s building contractor licence. However, his other contractor licence for electrical work was not cancelled. It was renewed on 20 June 2006, which the Commissioner subsequently asserted was a mistake. Having found that the renewal of Mr Khatter’s contractor licence for electrical work was a mistake, the Commissioner decided to cancel his renewed contractor licence in September 2006.
3 Mr Khatter did not seek review of the Commissioner’s decision to cancel his building contractor licence or his contractor licence for electrical work. Instead he made a fresh application for a contractor licence for electrical work on 30 July 2007 and it is the decision in respect of that application which is the subject of review of this application.
Issues
4 This application raises two principle issues. These are:
5 On 15 May 2005, when the matter was last before the Tribunal, the parties agreed that the Tribunal determine, as a preliminary issue, the decision of the Commissioner in so far as it relates to Mr Khatter’s fitness and propriety. In regard to the question of Mr Khatter’s qualification and experience, the parties agreed to continue their discussions and this issue was set down for further directions on 26 June 2008.
(a) Mr Khatter’s qualifications and experience and whether these are sufficient for him to be issued with a contractor licence for electrical work: see section 20(2) and (3) of the Act and clause 28(1)(a) and (b) of the Home Building Regulation 2004 (‘the Regulation’). It is not disputed that the relevant qualifications and experience are those set out by the Commissioner in Form L21.
(b) Mr Khatter’s fitness and proprietary to hold a contractor licence for electrical work: see section 20(1)(a) of the Act.
6 Accordingly, this decision only relates to the issue of Mr Khatter’s fitness and propriety to be issued with a contractor licence to do electrical work.
Relevant law
7 Section 20(1)(a) of the Act provides that the Commissioner must reject an application for a contractor licence if he/she is not satisfied that the applicant is a fit and proper person to hold a contractor licence.
8 Section 20(1A) of the Act provides that ‘without limiting sub-section (1)(a), in determining whether an applicant is a fit and proper person to hold a licence the [Commissioner] is to consider whether the applicant is of good repute, having regard to character, honesty and integrity.’
9 In two recent decisions of the Tribunal, involving applicants who had also obtained a building contractor licence on the basis of a falsified TAFE Certificate and whose existing specialist work licences were also cancelled, the Tribunal considered at length the relevant legal principles in regard to the assessment of a person’s fitness and propriety to be issued with a licence to undertake a regulated activity: see Raso v Commissioner for Fair Trading, Office of Fair Trading [2008] NSWADT 51 and Barakat v Commissioner for Fair Trading, New South Wales Office of Fair Trading [2008] NSWADT 127. These principles are summarised in the paragraphs below.
10 It is well accepted that ‘the question whether a person is fit and proper is one of value judgment’ – see Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321 per Mason DJ at 380. The discretion vested in a decision maker in determining a person’s fitness and propriety is to ‘give wide scope for judgment and allow broad basis for rejection’: see Commissioner for ACT Revenue v Alpha One Pty Ltd (1994) 49 FCR 589 per Northrop, Miles and French JJ at 389.
11 The expression ‘fit and proper person’ has no precise meaning and takes its meaning from its context, namely from the activities in which the person is or will be engaged and the ends to be served by those activities: see Bond per Toohey and Gaudron JJ at 380. That is, fitness and propriety are flexible concepts depending on the legislative context and the nature of the regulated activities: see also Re Percival and Australian Securities Commission (1993) 30 ALD 280, at 290 and Re Brennan & Australian Casino Surveillance Authority (1995) 38 ALD 794 at [41].
12 Fitness ‘with respect to an office is said to involve three things, honesty knowledge and ability … ‘: see Hughes and Vale Pty Ltd v New South Wales (No.2) (1955) 93 CLR 127 at 156-7.
13 To be satisfied that a person is ‘fit and proper’ it must be shown that the applicant ‘is possessed of a requisite knowledge of the duties and responsibilities involving upon him as the holder of a particular licence … but also that he is possessed of sufficient moral integrity and rectitude of character as to permit him to be safely accredited to the public … as a person to be entrusted with the sort of work which the licence entails’: see Sobey v Commercial and Private Agents Board 20 SASR 70 per Walters J at [76].
14 Where there is evidence of misconduct, that conduct should be considered in the context of any explanation that is given for the misconduct, its seriousness to the particular activity for which the person seeks to be licensed, the motivation of the person engaging in the misconduct, whether the misconduct is an isolated incident, the person’s underlying qualities of character, and the person’s conduct since the incident of misconduct and whether this demonstrates recognition of misconduct and subsequent reform: see McBride v Walton (NSW Court of Appeal, unreported, 15 July 1994 per Kirby P at [21]-[26], Powell JA at [59]-[73]. See also YJ v Chief Executive Officer, WorkCover Authority [2006] NSWADT 264 at [34]-[47].
15 It is accepted that issues of character and reputation may be determinative in deciding whether a person is fit and proper. These are different concepts with character relating to the inherent moral qualities of a person (see Melbourne v The Queen [1999] 198 CLR 1 per McHugh J at [15]. The assessment of a person’s character is relevant as it is an indicator of the person’s likely future conduct in the role that person will perform if a licence is granted: see Bond per Toohey and Gaudron JJ. On the other hand, reputation is an indication of the public perception of the future conduct of the person in the role for which a licence has been sought: see Re T and the Director of Youth and Community Services [1980] 1 NSWLR 392 per Waddell J at 393 and Director-General, Department of Transport v Z (No. 2) (GD) [2002] NSWADT AP 37 at [38].
Consideration
16 The Commissioner relies on two incidents of misconduct as the basis for finding that Mr Khatter is not a fit and proper person to be the holder of a contractor licence for electrical work.
17 The first incident is not disputed and concerns the falsified TAFE Certificate that Mr Khatter submitted in support of his 2000 application for a builder contractor licence. Mr Khatter’s only explanation of his conduct is that contained in a chronology and statement that he filed on 15 May 2008. In this document it is stated that Mr Khatter had been approached while working on a building site as to whether he was interested in obtaining a qualification for a builder contractor licence, to which he responded he was so interested. The inference to drawn from this is that Mr Khatter, was a willing participant in making an application for such a licence on the basis of false documentation. While he did not create the false document, he at all times knew it to be false. Notwithstanding being issued with the licence, Mr Khatter at no time used the licence to contract to do building work. Nor was it disputed that Mr Khatter co-operated with the ICAC inquiry.
18 The other allegation of misconduct is disputed. This conduct concerned a statement, dated 26 February 2004, of the practical work experience of Tarek Sabra, which the Commissioner alleged to have been completed and signed by Mr Khatter and which contained false information.
19 In a letter, dated 13 September 2006, from the Commissioner’s delegate to Mr Khatter, it is asserted that this statement and a false TAFE Certificate of Electrical-Fitter Mechanic Trade was submitted by Mr Sabra in support of his application for a contractor licence to do electrical work. While the letter states that Mr Khatter was provided with a coy of the statement and the false Certificate the Commissioner only provided a copy of the latter document to the Tribunal.
20 In the chronology and statement filed by Mr Khatter it is stated that Mr T Sabra was a former apprentice of Mr Khatter and for whom Mr Khatter had provided a reference dated 12 November 2001. That reference and the latter reference were the subject of the ICAC inquiry and for which Mr Khatter provided information. That information was put into the form of a written draft statement in December 2004, a copy of which was attached to the filed chronology and statement. In that draft statement Mr Khatter states that Mr Sabra had approached him for a reference in August 1998. The draft statement goes on to refer to three exhibits, one relates to a reference dated 12 November 2001 and the other two are statements of experience dated 21 November 2003 and 26 February 2004. A copy of the exhibits have not been provided. In the draft statement of Mr Khatter it is stated that the 2001 reference and the 2003 statement were documents prepared by Mr Khatter and that the details provided therein were correct. However, the statement of 26 February 2004 was not a document prepared by Mr Khatter. The signature on this statement was not that of Mr Khatter and the contents of the document were incorrect in that the work specified in the document were not undertaken by Mr Sabra alone.
21 In my opinion, on the material before the Tribunal, no finding can be made that Mr Khatter had prepared the 26 February 2004 false statement or that he was involved in Mr Sabra’s application for a contractor licence to do electrical work. In this regard it is noted that it was not disputed that no action of adverse findings were made by the ICAC against Mr Khatter in regard to this alleged misconduct.
22 In applying the principles set out in McBride I find that the misconduct relating to Mr Khatter making an application for a builder’s licence on the basis of a knowingly false Certificate is extremely serious. This is particularly so as it arose in the course of his licensed activities under the Act. At the same time the misconduct is isolated and occurred 8 years ago. Mr Khatter has also had 18 years of working as a licensed electrical contractor under the Act and during this time the Commissioner has not received any other complaints about his work or conduct in regard to his licensed activity. The fact that Mr Khatter did not use the builder contractor licence that was issued to him and the fact that Mr Khatter fully co-operated with the ICAC inquiry, in my view shows that he recognises that his conduct was unlawful.
23 Mr Khatter had provided the Commissioner with 5 references from builders, each of whom had worked with Mr Khatter and who said they would have no hesitation in recommending him to do electrical work. Two referees went on to state that in their opinion, Mr Khatter was honest and trustworthy. However, no referee made reference to Mr Khatter’s misconduct or the fact that they are aware of Mr Khatter’s licence to have been cancelled previously and the reason for such cancellation.
24 Mr Khatter submitted additional references for the purpose of his application before the Tribunal. In some cases these were references from an earlier referee, but dated a later date. Again many of the referees state that in their opinion Mr Khatter is honest and trustworthy, but no mention is made of his misconduct and cancelled licence and how the referee regarded Mr Khatter in light of this.
25 Because of this deficiency the material before the Tribunal is not sufficient for the Tribunal to make a finding that it is satisfied that Mr Khatter is a fit and proper person to be the holder of a contractor licence to do electrical work. The question is whether he should be given an opportunity to correct this deficiency.
26 In my opinion, given the nature of the deficiency and the fact that Mr Khatter’s qualifications remain an issue and that the matter has been set down for further directions it is appropriate for the Tribunal to give Mr Khatter an opportunity to file and serve any additional material in regard to his current reputation and character. That material need not be lengthy but should be filed within ten days of the publication of this decision and the Commissioner should be given seven days within which to respond. Subject to the material that is filed, the Tribunal will then be in a position to deal with this issue when the matter is next before it on 26 June 2008.
Orders
1. On or before Monday 16 June 2008 Mr Khatter to file and serve any additional material on which he seeks to rely in regard to his reputation and character
2. On or before Monday 23 June 2008 the Commissioner to file and serve any material in reply to that which is filed by Mr Khatter
3. Listed for Directions Thursday 26 June 2008 at 2:00pm.
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