Leslie May and Australian Securities and Investments Commission
[2012] AATA 515
•18 July 2012
[2012] AATA 515
Division GENERAL ADMINISTRATIVE DIVISION File Number
2012/2555
Re
Leslie May
APPLICANT
And
Australian Securities and Investments Commission
RESPONDENT
DECISION
Tribunal Deputy President P E Hack SC
Date 18 July 2012 Date of written reasons 6 August 2012 Place Brisbane The application for a stay of the implementation of the decision under review is granted upon the following conditions:
1.The applicant not managing any corporation other than Abrone Holdings Pty Ltd;
2.The stay lasting only until hearing and determination of the matter or earlier order and only so long as Abrone Holdings Pty Ltd remains the trustee of the applicant’s family superannuation fund.
.............................[Sgd]...................................
Deputy President P E Hack SC
CATCHWORDS
PRACTICE AND PROCEDURE – Application to stay implementation of decision – disqualification as a director – prevented from been director of corporate trustee of family superannuation fund – non-complying superannuation fund – potential hardship – conditional stay granted.
LEGISLATION
Administrative Appeals Tribunal Act1975 (Cth) s 41
Corporations Act 2001 (Cth) s 206F
Superannuation Industry (Supervision) Act 1993 (Cth) s 17A(1)CASES
Bryant v Commonwealth Bank (1996) 70 ALJR 306
Legal Services Commissioner v Baker [2005] QCA 482; [2006] 2 Qd R 107
New South Wales Bar Association v Stevens [2003] NSWCA 95; (2003) 52 ATR 602
Oaklands and Australian Securities and Investment Commission [2011] AATA 199REASONS FOR DECISION
Deputy President P E Hack SC
6 August 2012
On 21 May 2012, the respondent, the Australian Securities and Investment Commission, made a decision disqualifying the applicant, Mr Leslie May, from managing corporations for a period of two years. Notice of that decision was given to Mr May on 1 June 2012. The decision took effect upon service on Mr May on that day.
On 22 June 2012, Mr May applied to the Tribunal for a review of the Commission’s decision and at the same time sought an order pursuant to s 41 of the Administrative Appeals Tribunal Act1975 (Cth) staying the implementation of the decision. The underlying decision is a decision made in reliance on s 206F of the Corporations Act. Mr Lawson, the solicitor for Mr May, accepts, for the purposes of today’s hearing, that the jurisdictional facts required to enliven the Commission’s discretion in s 206F were satisfied. Mr May’s case in its bluntest form is that the circumstances of his case are not such as would warrant a disqualification. On that basis he says the stay should be granted even though it has been possible to arrange an early hearing of the matter on 20 August 2012.
The factors that seems to me to be relevant in the present case are that, without reaching any view as to the substance of the case, there is at least an arguable case that no disqualification might be the result of a review on the merits. The possible adverse consequences to Mr May if the stay is refused are also relevant but have a limited relevance to which I will return. There is as well a public interest in maintaining a decision in matters of this nature pending the hearing and determination of the underlying application. As has been said by Kirby J in Bryant v Commonwealth Bank[1]and in subsequent decisions of Courts of Appeal of New South Wales[2] and Queensland[3], an application for a stay of a disciplinary matter is somewhat different to a stay inter partes in ordinary civil litigation.
[1] (1996) 70 ALJR 306, 309.
[2] New South Wales Bar Association v Stevens [2003] NSWCA 95; (2003) 52 ATR 602.
[3] Legal Services Commissioner v Baker [2005] QCA 482; [2006] 2 Qd R 107.
Subject to an exception to which I will return, and given that an early hearing can be granted, I was not persuaded to grant a stay, all the more so when on the applicant’s affidavit, it would appear that the principle basis upon which he sought a stay was so that he could become a director of a company by whom he is presently employed.
At the hearing however, the thrust of the case changed somewhat and what was particularly pressed by Mr Lawson was the hardship that would be occasioned to Mr May if he were prevented from being a director of Abrone Holdings Pty Ltd, which is the corporate trustee of Mr May’s family superannuation fund. Because the point emerged somewhat late, it has not been the subject of extensive research by either the applicant or by Mr Coveney, counsel for the respondent. However it appears, and to this point I am persuaded, that a consequence of the disqualification is that the applicant’s family superannuation fund fails to satisfy the basic conditions under the Superannuation Industry (Supervision) Act 1993 (Cth) with the further consequence that it would then be a non-complying superannuation fund. If that were so there are adverse taxation consequences for the superannuation fund.
That appears to be the case because section 17A(1) of that Act requires where the trustee of a fund is a body corporate, each director of the body corporate must be a member of the fund and each member of the fund must be a director of the body corporate. In circumstances where there will be an apparent adverse consequence and where the stay that I will propose would prevent Mr May from managing any corporation other than the corporate trustee of the family superannuation fund, I am persuaded that the appropriate order is to grant a stay but using the device adopted by Senior Member Redfern in Oaklands and Australian Securities and Investment Commission.[4] I will make that stay conditional upon (1) the applicant not managing any corporation other than Abrone Holdings Pty Ltd and (2) the stay lasting only until hearing and determination of the matter or earlier order and only so long as Abrone Holdings Pty Ltd remains the trustee of the applicant’s family superannuation fund.
[4] [2011] AATA 199.
There will be liberty to apply to vary or rescind this order if it should appear on more mature reflection on the underlying law that the concern which has prompted the grant of the stay is more apparent than real.
I certify that the preceding 7 (seven) paragraphs are a true copy of the reasons for the decision herein of Deputy President P E Hack SC. ..............................[Sgd]...................................
Associate
Dated 6 August 2012
Date of hearing 18 July 2012 Solicitors for the Applicant Porter Davis Lawyers Counsel for the Respondent Mr G Coveney Solicitors for the Respondent Self represented
0
4
3