Middlebrook and Tax Practitioners Board - [2020] AATA 3698

Middlebrook and Tax Practitioners Board [2020] AATA 3698 (18 September 2020)
Division:TAXATION AND COMMERCIAL DIVISION
File Number(s): 2019/8210
Re:Allen Middlebrook
APPLICANT

AndTax Practitioners Board
RESPONDENT

DECISION
Tribunal:Deputy President Bernard J McCabe
Date:18 September 2020
Place:Sydney

The decision to cancel the applicant’s registration as a tax agent is affirmed. The decision to prohibit the applicant from applying for registration is varied from five years to four years.
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Deputy President Bernard J McCabe
CATCHWORDS
TAX AGENT – termination of registration – reasons for misconduct/breach of Code of Professional Conduct – applicant found not to be fit and proper person – termination the correct form of regulatory action – reduction of ban from reapplying – decision varied
LEGISLATION
Tax Agents Services Act 2009 (Cth) ss 20-5, 20-15, 20-45, 30-10, 30-20, 30-25, 40-5, 40-25, 60-125
CASES
Re Allen J Middlebrook & Associates Pty Ltd and Tax Practitioners’ Board [2010] AAT 622
Re Li and Tax Practitioners Board (2014) 141 ALD 201
Rent to Own (Aust) Pty Ltd and Australian Securities and Investments Commission [2011] AATA 689
Re Tung and Tax Practitioners Board (2012) 90 ATR 480
Ridden and Tax Practitioner Board [2020] AATA 422
REASONS FOR DECISION
Deputy President Bernard J McCabe
18 September 2020

Allen Middlebrook was a registered tax agent for around 25 years. He carried on a small practice in the western suburbs of Sydney through his company. All that came to an end when the Tax Practitioners Board decided to (a) cancel his registration and (b) thereafter prevent him from seeking (re)registration for a period of five years. Mr Middlebrook was told of the cancellation decision on 31 October 2019 and the decision took effect on 30 November 2019.
Mr Middlebrook asked the Tribunal to revisit the decisions to cancel and preclude him from seeking registration for five years. By the time of the hearing, the grounds of the review had narrowed.
Mr Middlebrook did not dispute the findings of fact that were made against him by the Board as it made the reviewable decisions. Mr Middlebrook acknowledged the Board was justified in finding he had contravened a number of provisions of the Code of Professional Conduct that forms part of the Tax Agents Services Act 2009 (Cth) (the TAS Act). He agreed those contraventions justified regulatory action being taken against him. But in written submissions lodged in advance of the hearing, Mr Middlebrook insisted he was a fit and proper person, and that his registration should not be cancelled. He argued his registration should be suspended instead for a period of time, and that lifting the suspension might depend on him satisfying conditions the Tribunal imposed.
At the hearing, Mr Middlebrook sought to put his mental health at the forefront of his case. He argued his misconduct was affected by his mental state, and that his mental health had now improved. The argument about his mental health was signalled in his statement dated 9 April 2020 and in the applicant’s written outline of…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

AGLC: Middlebrook and Tax Practitioners Board [2020] AATA 3698
Case: [2020] AATA 3698
Decision Date: 18 September 2020

CaseChat Overview and Summary

The Administrative Appeals Tribunal (AAT) considered the appeal of a tax agent whose registration had been terminated by the Tax Practitioners Board (TPB). The dispute centred on whether the TPB's decision to terminate the agent's registration and prohibit them from reapplying for a period of five years was appropriate, given the applicant's conduct.

The Tribunal was required to determine if the applicant was a fit and proper person to be registered as a tax agent, and consequently, whether the TPB's disciplinary action, specifically the termination of registration and the period of prohibition from reapplication, was the correct and preferable course of action.

Deputy President McCabe P affirmed the TPB's decision to cancel the applicant's registration, finding that the applicant's misconduct and breaches of the Code of Professional Conduct meant they were not a fit and proper person. However, the Tribunal varied the period of prohibition from reapplying for registration, reducing it from five years to four years, concluding that this revised period was the appropriate regulatory response.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

After weighing all these things together, I am satisfied the applicant should not be permitted to apply for registration for a period of four years. I would vary the decision under review to that extent.CONCLUSION The decision to cancel the applicant’s registration as a tax agent is affirmed. The decision to prohibit the applicant from applying for registration is varied from five years to four years.

Ratio Decidendi

Legal Principle Established

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