Mikosza v Key to Australia Pty Ltd - [2024] QCAT 216

QUEENSLAND CIVIL AND
ADMINISTRATIVE TRIBUNAL

CITATION:

Mikosza v Key to Australia Pty Ltd and Anor [2024] QCAT 216

PARTIES:

OLGIERD MIKOSZA

(applicant)

v

KEY TO AUSTRALIA PTY LTD (DEREGISTERED)

(first respondent)

GRAHAM MARK SCARROTT (A BANKRUPT)

(second respondent)

APPLICATION NO/S:

OCL063-21

MATTER TYPE:

Other civil dispute matters

DELIVERED ON:

15 May 2024

HEARING DATES:

12 June 2023 and 7 March 2024

HEARD AT:

Brisbane

DECISION OF:

Member Poteri

ORDERS:

1. The claim against the claim fund established pursuant to the provisions of the Agents Financial Administration Act 2014 (Qld) made by Olgierd Mikosza dated 28 June 2021 for the amount of $59,689.24 should be rejected.

CATCHWORDS:

ADMINISTRATIVE LAW – ADMINISTRATIVE TRIBUNALS – QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL – Where residents of New Zealand have invested in real estate in Australia – where the residents were induced to make this investment because of the false and or misleading representations of an Australian registered real estate agent – where the real estate agent is alleged to have disbursed funds without authorisation from the real estate agent’s trust account – where the scheme has failed – where the residents have made a claim against the Claim Fund under the provisions of the Agents Financial Administration Act 2014 (Qld) – where the claim has been referred to the Tribunal for a determination.

Agents Financial Administration Act 2014 (Qld), s 6, s 80, s 82, s 85, s 88, s 95, s 105

Property Occupations Act 2014 (Qld), s 12

Freehold Land Investments Ltd v Queensland Estates Pty Ltd (1970) 123 CLR 418

Goodchild v Ferrantino [2007] QCCTPAMD 2

APPEARANCES & REPRESENTATION:

Applicant:

Self-represented

First Respondent:

Key to Australia Pty Ltd

No appearance

Second Respondent:

Graham Mark Scarrott

No appearance

Office of Fair Trading:

Mr A Tan, Legal Officer of the Office of Fair Trading

GENERAL OVERVIEW

This is an overview of 17 claims made under the provisions of the Agents Financial Administration Act 2014 (Qld) (‘AFAA’) regarding the activities of the First Respondent, Key to Australia Pty Ltd (‘Key’), and the Second Respondent, Graham Mark Scarrott (‘Scarrott’).
I have consent of all the claimants to refer to the evidence and details of each of the various claims when considering the individual claims.
The consideration of the claims should be viewed as a whole because all of the claims refer to the proposed purchase of some 20 lots at Pimpama, Queensland. The lots were the subject of put and call option agreements (‘P&C’) with Eagle Street Finance Pty Ltd (‘Vendor’).
In all Scarrott and Key were paid the total of approximately $2,380,000 by the claimants. Scarrott paid approximately $603,000 to the Vendor for deposits under the P&Cs. Approximately $72,000 was paid to the Gold Coast City Council (‘the Council’) for application fees and approximately $33,000 was paid to the town planners, Zone Planning Group (‘ZPG’). The Tribunal has not been informed of any other amounts that Scarrott may have paid to other consultants or contractors.
Scarrott and Key had at their disposal approximately $1,690,000. It is not clear to me how Scarrott and Key used these funds. However, most of these funds were used without the implied or express authority of the claimants on personal expenses, company expenses and keeping the whole scheme going. The funds were dishonestly used by Scarrott and Key.
Scarrott and Key were charged and convicted of breaches of the Australian Consumer Law (‘ACL’) regarding their marketing of land at Pimpama. There were 18 complainants. Scarrott and Key pleaded guilty to the charges. Scarrott participated in voluntary records of interview with officers of the Office of Fair Trading (‘OFT’) in 2020. The admissions were read to the Court during the criminal proceedings. The admissions are set out in Annexure 3 attached to the Form 4 – Complaint in the Supplementary Document Bundle filed by OFT on 17 March 2023. In summary the admissions show:[1]
[1]OFT Supplementary Document Bundle filed 17 March 2023, 10-3.
(a)Scarrott and Key fraudulently converted approximately between $1,600,000 and $1,700,000 to his own account or to pay another person’s use.
(b)Scarrott forged ANZ finance approval letters to buy time.
(c)Scarrott started marketing the lots in late 2018.
(d)Scarrott had no assurances from Council that it would approve the subdivision of the lots. This was confirmed by advice from ZPG dated 23 April 2019.
(e)Scarrott arranged for ZPG to lodge six (6) applications with Council on 26 August 2019. Post lodgement of the applications, Scarrott had meeting with the Council and he was aware that the Council raised concerns with the applications. Scarrott continued to market the lots at Pimpama.
(f)The complainants’ funds were paid into the bank account known as the Key To Australia Pty Ltd As Trustees For The Scarrott Family Trust. Scarrott told the complainants that he and Key were licenced agents, and this bank account was a “trust account”.
(g)The returns that Scarrott was promising to the complainants was based on an imagined figure rather than evidence based.
(h)Scarrott and Key’s trading losses per month were between $75,000 and $120,000.
(i)Scarrott estimated that he only spent on average approximately $4,100 of each complainant’s funds in prosecuting the subdivision approval for the lots.
The Tribunal has no investigation powers. These powers are exercised by the Chief Executive of OFT under the AFAA.
The consideration of each claim was difficult and complicated because Scarrott and Key did not appear at the hearing. Scarrott did provide an unsworn statement which is very general in nature, self-serving and is not corroborated.
The claimants were ordinary everyday New Zealanders (except for one Australian claim) who trusted Scarrott. Generally, I found the claimants to be entirely credible and honest. Also, I found them to be extremely courteous and at times somewhat embarrassed by the way they were convinced by Scarrott to trust him.
In almost all cases there is no question that Scarrott did not provide the claimants with full details of his proposal. He did not inform them of the possible shortcomings, disadvantages, and obstacles to overcome. He almost invariably told the claimants about the expected profit and gave them certainty.
Scarrott’s plan was for the parties to enter P&Cs with the Vendor and pay a deposit to secure the purchase of a lot (or lots). Other monies were paid to Scarrott by the claimants so that Scarrott could obtain approval from the Council to subdivide the lot into three (3) individual lots and obtain approval to erect three (3) townhouses on the individual subdivided lots.
Scarrott arranged for ZPG to lodge applications with the Council to subdivide lots 280, 281, 282, 333, 334 and 335 in April 2019. No applications were lodged with the Council to subdivide any other lots.
I presume the plan was to on sell the subdivided lots with approved plans, or to erect the townhouses on the subdivided lots and to on sell these subdivided improved lots. However, Scarrott did promise the claimants that they would not have to invest any further funds in the scheme, and they would not have to become purchasers of the individual lots. It is not clear to me how this would work in practice from a legal or timing perspective.
Bridging finance may have been required because the Council took more than the expected three (3) to four (4) months (as advised by ZPG) to assess the applications. One of the claimants stated that at one stage Scarrott did discuss the necessity to obtain bridging finance. Scarrott has admitted to forging ANZ approval letters to buy time during this period.
It was all a question of timing and the Council approving the subdivision of the individual lots without the necessary setbacks and relaxation of on-street parking. In the end the Council took 10 months to assess and reject Scarrott’s application, financing became more difficult and the COVID epidemic made all commercial activities more complicated.
It is difficult to ascertain when Scarrott started using the funds for his personal and Key’s expenses and other financing expenses to keep the whole scheme going. However, the Vendor became impatient and in 2020 the Vendor called upon the claimants to perform their obligations under the P&Cs and to pay the balance of the purchase prices under the P&Cs. Many of the claimants could not complete the purchases so their deposits were forfeited to the Vendor.
Ironically, two (2) claimants who had the resources to complete the purchase of a lot and retain the lot have seen a substantial increase in the value of their lot and, thus, they have not suffered a financial loss.

REASONS FOR DECISION

The claims from various claimants have been referred to the Tribunal pursuant to section 95 of AFAA for determination.
I refer to the overview to provide some background to the various claims.
The Applicant, Olgierd Mikosza (‘Mikosza’), lodged a claim dated 20 July 2020 for an amount of $70,000 and on 28 June 2021, he amended the claim to the amount of $59,689.24 regarding his entering into a P&C dated 19 May 2019 to purchase lot 496 at Pimpama from the Vendor.
On 30 August 2021, OFT referred Mikosza’s claim to the Tribunal for determination pursuant to section 95 of the AFAA. OFT have annexed various documents, including details of OFT’s investigations and material supplied by Mikosza in the referral (‘the Referral’).
Mikosza has executed a sworn statement (‘Mikosza’s Statement’) dated 17 September 2019 which is on pages 94 to 97 of the Document Bundle attached to the Referral. In Mikosza’s Statement he says:
(a)In 2019, Mikosza had dealings with Scarrott and John Glover (‘Glover’), an employee of Key. Scarrott convinced him to invest in land at Pimpama.
(b)On or around 5 May 2019, Mikosza executed an expression of interest to purchase lot 495 at Pimpama.
(c)On or around 6 May 2019, Mikosza executed an expression of interest to purchase lot 496 at Pimpama.
(d)On or around 22 May 2019, Mikosza received the P&Cs relating to the purchase of lots 495 and 496 at Pimpama. On 24 May 2019, Mikosza executed the P&Cs in the presence of Glover.
(e)Mikosza transferred $127,000 to Key to secure the purchase of lots 495 and 496.
(f)The P&C dated 24 May 2019 to purchase lot 496 is on pages 120 to 278 of the Document Bundle attached to the Referral. A deposit of $33,000 has been paid to the Vendor pursuant to the terms of the P&C.
(g)A copy of the P&C to purchase lot 495 has not been supplied to the Tribunal. However, it appears that a deposit was paid to the Vendor to secure the purchase of lot 495 but the Tribunal has not been advised of the details of the purchase price for lot 495 or the deposit paid to secure lot 495.
(h)Mikosza claims that Scarrott and Glover made false and/or misleading representations to him which induced him to enter the P&Cs to purchase lots 495 and 496 and Scarrott/Key fraudulently withdrew funds from the Key bank account without authority.

LEGISLATION

For reference, I outline the relevant legislative provisions of the AFAA:
80Definitions for pt 7
In this part—
agent includes—
(a)     a former agent; and
(b)     a person who is not authorised under the Debt Collectors (Field Agents and Collection Agents) Act 2014, part 2, division 1 to perform a relevant activity within the meaning of that division, but who acts as if the person were authorised under that division; and
(c)      a person who is not licensed under an Agents Act, but who acts as a licensee; and
(d)     a former licensee under the repealed Property Agents and Motor Dealers Act 2000.
chattel auctioneer see the Motor Dealers and Chattel Auctioneers Act 2014, schedule 4.
claimant means a person who makes a claim against the fund.
claim notice see section 91(1).
financial loss, suffered by a person, if evidenced by a judgment of a court, does not include interest awarded on the judgment.
marketeering contravention means a contravention of any of the following by a relevant person—
(a)     the Property Occupations Act 2014, section 207, 208 or 209;
(b)     section 573A, 573B or 573C of the repealed Act.
Note—
For claims relating to offences mentioned in paragraph (b), see section 155 (Claim fund).
motor dealer see the Motor Dealers and Chattel Auctioneers Act 2014, schedule 4.
motor vehicle see the Motor Dealers and Chattel Auctioneers Act 2014, schedule 4.
registered office—
(a)     of an agent who is a debt collector under the Debt Collectors (Field Agents and Collection Agents) Act 2014—see section 13 of that Act; or
(b)     of an agent who is a licensee under the Motor Dealers and Chattel Auctioneers Act 2014—see section 70 of that Act; or
(c)      of an agent who is a licensee under the Property Occupations Act 2014—see section 93 of that Act.
relevant activity, for a debt collector under the Debt Collectors (Field Agents and Collection Agents) Act 2014, means any of the following activities under that Act—
(a)     a debt collection activity;
(b)     a repossession activity;
(c)      a process serving activity.
relevant person means the following—
(a)     an agent;
(b)     an agent’s employee or agent, or a person carrying on business with the agent;
(c)      a person having charge or control, or apparent charge or control, of an agent’s registered office or business.
residential property see the Property Occupations Act 2014, schedule 3.
respondent, for a claim, means a person whose actions are alleged to have given rise to the claim.
82Claims
(1)     A person may claim against the fund if the person suffers financial loss because of the happening of any of the following events—
(a)a contravention of section 21 or 22;
(b)a stealing, misappropriation or misapplication by a relevant person of property entrusted to the person as agent for someone else in the person’s capacity as a relevant person;
(c)the contravention by a relevant person of the Debt Collectors (Field Agents and Collection Agents) Act 2014, section 133;
(d)the contravention by a relevant person of the following provisions of the Motor Dealers and Chattel Auctioneers Act 2014—
•section 91
•section 92
•section 104(4)
•section 113
•section 136
•section 137
•section 215
•section 216;
(e)a failure of a motor dealer to ensure a person who has bought a motor vehicle sold by or for the dealer gains clear title to the vehicle at the time property in the vehicle passes to the buyer, whether or not the motor dealer contravenes the Motor Dealers and Chattel Auctioneers Act 2014, section 96;
(f)a failure of a chattel auctioneer to ensure a person who has bought a motor vehicle sold by the auctioneer (other than a motor vehicle sold for another auctioneer or a motor dealer) gains clear title to the vehicle at the time property in the vehicle passes to the buyer, whether or not the auctioneer contravenes the Motor Dealers and Chattel Auctioneers Act 2014, section 142;
(g)a contravention by a relevant person of the following provisions of the Property Occupations Act 2014—
•section 154
•section 155
•section 206
•section 207
•section 208
•section 209
•section 212.
(2)     A person may make a claim against the fund for financial loss relating to a non-investment residential property purchased by the person because of, or arising out of, a marketeering contravention only to the extent the loss is capital loss.
(3)     Also, capital loss mentioned in subsection (2) may be claimed only if the loss has been realised as mentioned in section 110.
85General time limit for making claims
(1)     This section applies to a claim against the fund other than a claim because of, or arising out of, a marketeering contravention relating to the purchase of a non-investment residential property.
(2)     A person may make the claim against the fund for financial loss for the happening of an event only if the person makes the claim within the earlier of the following—
(a)1 year after the person becomes aware that the person has suffered the loss;
(b)3 years after the happening of the event.
(3)     However, if the person starts a proceeding in a court to recover the person’s financial loss within the time permitted to make a claim under subsection (2), the person may make the claim within 3 months after the proceeding in the court ends.
(4)     Subsection (3) does not limit the time allowed under subsection (2) to make a claim.
(5)     In this section—
court includes QCAT.
88Making claims other than particular claims relating to marketeering contraventions and non-investment residential property
(1)     This section applies to a claim against the fund, other than a claim for loss because of, or arising out of, a marketeering contravention relating to the purchase of a non-investment residential property.
(2)     The claim must be made to the chief executive in the approved form and state—
(a)the event alleged to give rise to the claim; and
(b)when the event happened; and
(c)if the claimant was not immediately aware that the claimant suffered financial loss because of the happening of the event, when the claimant became aware of the financial loss; and
(d)all relevant particulars about the event and the financial loss; and
(e)the claimant’s estimated financial loss.
(3)     The claim is taken to have been made on the day the claim is given to the chief executive even if the claimant is unable to state all of the particulars mentioned in subsection (2).
(4)     The chief executive may require the claimant to verify the claim, or part of the claim.
Example of verification—
statutory declaration
(5) If the claim is not made within the time allowed under section 85, the chief executive must give the person a notice in the approved form stating that—
(a)the claim is out of time; and
(b)the person may apply to QCAT, within 14 days after being given the notice, for an extension of time within which to make the claim.
95Chief executive may decide or refer claim
(1)     The chief executive may—
(a)decide a claim under this division; or
(b)refer the claim to QCAT to decide, if the chief executive considers—
(i)the claim could be more effectively or conveniently decided by QCAT because of, for example, the nature and complexity of the claim; or
(ii)it would be appropriate for the claim to be decided by QCAT.
(2) However, if, under section 122, QCAT decides to extend the time within which a claim must be filed, QCAT may also decide the claim.

CLAIM

Pursuant to section 82 of AFAA, Mikosza has lodged a claim (‘Claim’) on 28 June 2021 against the Claim Fund which is administered by the OFT. The Claim was made within the time stipulated in section 85 of AFAA.

JURISDICTION

OFT has raised the issue of jurisdiction of the AFAA in these matters. There are no specific provisions in the AFAA which expressly limits the operations of the legislation to activities that take place in Queensland. Therefore, I must look to the caselaw to decide this issue.
The High Court decision of Freehold Land Investments Ltd v Queensland Estates Pty Ltd (1970) 123 CLR 418 (‘Freehold’) is instructive. Freehold involved a claim for commission where negotiations for a contract for the sale of land occurred inside and outside of Queensland.[2] The court in Freehold examined the provisions for the Auctioneers, Real Estate Agents, Debt Collectors and Motor Dealers Act 1922 to 1961 (Qld). This legislation is similar to the legislation in the AFAA.
[2]Freehold Land Investments Ltd v Queensland Estates Pty Ltd (1970) 123 CLR 418 (‘Freehold’).

In Freehold, the Court held that the activities occurred in Queensland. However, the Court stated:[3]
The Act clearly enough is not concerned with what is done outside Queensland, even if it be done in accordance with a contract the proper law of which is the law of Queensland. On the other hand, whatever may be the proper law of an agency contract, the Act applies to a person who acts as, or carries on the business, of a real estate agent in Queensland and a Queensland court would give effect to it. It is not, therefore, possible to support the conclusion which his Honour reached on the ground upon which his Honour based it.
The critical question is rather, did the claimant, in doing what it did pursuant to its agency contract with the owner, act as, or carry on the business of a real estate agent in Queensland? The circumstances here are such that unless the claimant acted as a real estate agent in Queensland in the transaction with which we are concerned it did not carry on business as a real estate agent in Queensland, so that the question can be narrowed down to whether or not, in the course of the negotiation of the sale from Queensland Estates Pty. Ltd. to Golden Acres Ltd., it acted as a real estate agent in Queensland.
[3]Ibid 425-6.
The matter of Goodchild v Ferrantino,[4] involved a claim under the Property Agents and Motor Dealers Act 2000 (Qld) (‘PAMD Act’) for certain fraudulent activities that occurred in Queensland. In Goodchild, even though the land was situated in New South Wales, all the activities occurred in Queensland, therefore, the claim was allowed, even though the land was outside of Queensland. In Goodchild, the Tribunal noted that one of the objects of the PAMD Act was for the protection of consumers. The main object of the AFAA is “to protect consumers from financial loss in dealing with agents”. The analysis of the law in Goodchild is relevant to the facts and circumstances in these proceedings.
[4][2007] QCCTPAMD 2 (‘Goodchild’).
I conclude that the protection given to claimants under the provisions of AFAA is restricted to cases where the activities take place in or predominantly in Queensland.
In these proceedings, the following facts apply:
(a)The Vendor and the Land are in Queensland.
(b)Key and Scarrott are licenced in Queensland and operated out of offices in Queensland.
(c)Mikosza transferred his funds to Key’s bank account which is located in Queensland.
(d)There were communications between the various stakeholders in Queensland and Mikosza before and after the execution of the P&Cs.
I find that the facts and circumstances of this matter demonstrate that there is sufficient nexus to Queensland for the provisions of the AFAA to apply and for the Tribunal to have jurisdiction over the Claim.

OBJECTS OF AFAA AND PROPERTY OCCUPATION ACT 2014 (QLD)

The main object of the AFAA is set out in section 6 of the AFAA. In summary, the object is to protect consumers from financial loss in dealings with agents and this is to be achieved by regulating the ways agents operate trust accounts and establishing a claim fund to compensate persons in particular circumstances for financial loss arising from dealings with agents.
The main objects of the Property Occupation Act 2014 (Qld) (‘POA’) are set out in section 12 of the POA. In summary, one of these objects is to provide a system of licencing of property which balances between the need to protect consumers and promote freedom of enterprise in the marketplace. Another object is to provide a way of protecting consumers against undesirable practices associated with the promotion of residential property.
In essence the objects of both pieces of legislation are to provide for a system for licencing agents and to protect consumers.
If there are any inconsistencies or ambiguity in the facts, circumstances and interpretation of relevant legislation in these proceedings, then given the objects of the legislation are squarely aimed at consumer protection, then any such inconsistencies and ambiguities should be exercised in the claimant’s favour.
The Claim Fund has been set up under the AFAA to enable claimants to make claims against licenced real estate agents who have acted fraudulently or who have made false or misleading representations to potential purchasers. This an initiative of the Queensland Government. In assessing claims made under the AFAA, I must be mindful that I am dealing with government funds. Therefore, I must ensure that on the balance of probabilities that there is sufficient evidence to satisfy the relevant provisions of AFAA to approve or reject any claim.
Pursuant to section 82 of the AFAA, a person may make a claim if the person suffers financial loss because of the happening of the events outlined in section 82(1) of AFAA. The basic facts and circumstances of the Claim suggest that section 82(1)(a), (b) and (g) may apply to the Claim. In summary, Mikosza is claiming:
(a)that monies were to be held in trust by Scarrott/Key and that they disbursed part of these monies without authority.
(b)In marketing the lots Scarrott made representations that were false or misleading which induced Mikosza to execute the P&Cs.
To determine the Claim, I must analyse and assess all of the evidence that is presented to the Tribunal. However, it is my view that all the relevant evidence has not been presented or supplied to the Tribunal. There are two (2) fundamental questions that must be answered before I can make a final determination of the Claim. These questions are:
(a)Is Mikosza’s purchase of lot 495 part of the facts and circumstances relating to the Claim (i.e. Mikosza’s claim for financial losses resulting from his execution of the P&C for lot 496 and the subsequent failure to complete the P&C and the forfeiture of the deposit of $33,000 to the Vendor)?
(b)If found that Mikosza’s purchase of lot 495 is part of the Claim, then this may have an impact on Mikosza’s claim for $59,689.24 for his financial losses. If the value of lot 495 has increased, then this increase should be considered as a whole in assessing Mikosza’s overall financial losses. In fact, there may be a net gain, in which case there can be no claim against the Claim Fund.
It seems to me that prima facie the two (2) P&Cs are connected and are part of the same claim. This is because:
(a)All the discussions between Scarrott, Glover and Mikosza leading up to the execution of the two (2) P&Cs took place together.
(b)The two P&Cs were executed at the same meeting with Glover on the same date.
(c)Mikosza refers to the two (2) lots and the two (2) purchases in the Claim.
Mikosza, in his Statement, has not provided the Tribunal with the full details of what transpired when he was called upon to complete both P&Cs. This was discussed when Mikosza gave oral evidence to the Tribunal by remote conferencing on 7 March 2024. Mr Tan of the OFT was also present during the hearing and he was not able to provide any further assistance to the Tribunal.
At the hearing, Mikosza stated that he had completed the P&C for lot 495 and that he is still the registered proprietor of lot 495. Mikosza stated that he was not able to complete the P&C for lot 496 and, thus, he was claiming the financial losses that he had sustained resulting from his proposed purchase of lot 496. That is the forfeiture of the deposit of $33,000 and other losses. The total claimed by Mikosza is $59,689.24. Mikosza has not provided the Tribunal with the details of how he calculates his claim of $59,689.24.
During the hearing on 7 March 2024, I went on to explain to Mikosza that if his purchase of lot 495 was determined to be part of the Claim then I would have to take into account any possible gains that he has made on the purchase in determining his overall financial losses. Further, I explained to Mikosza that he had the right to make submissions on the issue of financial losses and to respond to my questions in writing. In response, Mikosza stated that he did not accept that the purchase of lot 495 should be part of the Claim. He stated that they were two (2) separate transactions and the financial losses for his proposed purchase of lot 496 should be considered separately.
Directions were sent to Mikosza on 20 March 2024. In these directions I requested the following from Mikosza:
(a)Full details and copies of relevant documentation relating to the purchase of lot 496.
(b)A current valuation of lot 496.
(c)Submissions on why the purchase of lot 496 should not be included in his claim relating to his execution of a put and call option agreement for lot 495.
Mikosza responded to these directions on 28 March 2024. Mikosza objected to the time allowed for him to comply with the directions. He also suggested that I should recuse myself because I was not qualified to conduct the case and my directions suggest that Mikosza does not have the right to claim “loss of funds” regarding one (1) property when he was lucky to buy another one. He is maintaining his position and stated that he was not prepared to provide any further information or material and that the Claim should be paid immediately.
On 9 April 2024, I issued further directions to provide Mikosza with more time to respond to the Tribunal Directions dated 7 March 2024 and sent to Mikosza on 20 March 2024. In the new Directions, I allowed Mikosza until 26 April 2024 to provide the requested details to the Tribunal. Further, I warned Mikosza that if he did not provide the requested material/information to the Tribunal or give a reason why he does not wish to comply with the Directions then I may determine the matter on the evidence currently before the Tribunal, in his absence, without further notice to him, and the determination may be adverse to him. I also offered that Mikosza could provide this information/material in an oral hearing.
Mikosza responded to these directions on 18 April 2024 where he stated that he had nothing more to add to his case and the complaint sent in his previous email.
I have invited Mikosza to provide the material/information regarding his purchase of lot 496 on three (3) occasions (i.e. at the oral hearing and the two (2) directions issued) and on each of those occasions Mikosza has refused my requests.
I do not intend to recuse myself from determining the Claim. I am suitably qualified, and I have been properly appointed by the State of Queensland to act as a member of the Tribunal. I can see no reason to stand aside from this matter. The details that I am seeking from Mikosza are required to provide a full and balanced picture of what occurred in 2019 and 2020 relating to the execution of the P&Cs, the subsequent settlement of one P&C and the termination of the other P&C. I must be fair and reasonable to Mikosza and all stakeholders, including OFT, when dealing with claims of this size involving public funds.

FINDINGS

Pursuant to section 82(1) of AFAA a claim may be made against the Claim Fund if the person suffers a financial loss because of the happening of any of the events outlined in section 82(1)(a)(b) or (g) of AFAA. These are fundamental threshold questions.
Putting aside the issue of satisfying the happening of events outlined in section 82(1)(a)(b) and (g), the first question that I must consider is the question of Mikosza’s financial loss. To determine the financial loss of Mikosza, I must first make findings about the facts and circumstances leading up to and the execution of the two (2) P&Cs and what transpired when the Vendor called upon Mikosza to complete both P&Cs.
The two (2) possible scenarios in these proceedings are:
(a)Scenario 1 is where I make a finding that the purchase of lot 496 is not part of the Claim for the losses caused by Mikosza executing the P&C for lot 495 and failing to complete the P&C. In this scenario, Mikosza would still have to provide details and prove his claim for financial losses of $59,689.24.
(b)Scenario 2 is where I make a finding that the purchase of lot 496 is connected with and is part of the Claim for losses caused to Mikosza executing the P&C for lot 495 and failing to complete the P&C when called upon to do so by the Vendor. In this scenario, Mikosza would have to advise the Tribunal of his net gains from his purchase of lot 496 which should be deducted from Mikosza’s Claim. In fact, it may be found that there was an overall net gain in which case Mikosza would not have suffered any financial loss at all.
The scenario 2 referred to above occurred with another claimant. In that case, the claimant acknowledged that the value of the lot that he had purchased had increased considerably over the last four (4) years. When I explained this to the claimant, that any gain must be taken into account in assessing the overall financial loss, that claimant advised the Tribunal that the increased value of the lot far exceeded the financial loss claimed. That particular claimant consented to the withdrawal of their claim.
In deciding the Claim, I must be satisfied on the balance of probabilities that Mikosza can make a claim. See section 105(2) of AFAA. I cannot allow the Claim because I do not have sufficient information, material and evidence before me to determine Mikosza’s financial loss because Mikosza has not provided and refuses to provide the Tribunal with the facts and circumstances leading up to the execution of both P&Cs and the settlement of one (1) P&C and the termination of the other P&C.
As mentioned previously, I have not made any specific findings regarding the Claim satisfying the happening of events referred to in section 82(1)(a), (b) and (c) of AFAA. This is not necessary as I cannot determine if Mikosza has suffered any financial loss as outlined in section 82(1) of AFAA.
Accordingly, I must recommend that the Claim should be rejected.