Modini and Tax Practitioners Board

Case [2012] AATA 772

[2012] AATA 772 

Division GENERAL ADMINISTRATIVE DIVISION

File Number

2012/2113

Re

Denise Modini

APPLICANT

And

Tax Practitioners Board

RESPONDENT

DECISION

Tribunal

Deputy President R P Handley
Date 6 November 2012
Place Sydney

Decision Summary The decision under review is affirmed.

............[sgd]................................

Deputy President R P Handley

CATCHWORDS

TAX AGENTS – Application for registration as individual tax agent – Applicant for registration as individual tax agent rejected – Whether Applicant satisfies ‘fit and proper person’ requirements under the Tax Agent Services Act 2009 to be registered as an individual tax agent – Whether Applicant satisfies relevant experience requirement under the Tax Agent Services Act 2009 – Decision under review affirmed

LEGISLATION

Income Tax Assessment Act 1936 (Cth)

Tax Agent Services Act 2009 (Cth)

Tax Agent Services Regulations 2009 (Cth)

CASES

Australian Broadcasting Tribunal v Bond(1990) 170 CLR 321

Hughes & Vale Pty Ltd v New South Wales (No 2)(1955) 93 CLR 127

Kolya Tax Practitioners Board [2012] FCA 215

Modini and Tax Agents’ Board of Queensland [2004] AATA 427

Modini and Tax Agents’ Board of Queensland (2005) 89 ALD 496

Modini and Tax Agents’ Board of Queensland (2007) 98 ALD 466

Re Su and Tax Agents Board of South Australia (1982) 61 FLR 1

Stasos v Tax Agents Board of NSW (1990) 21 ALD 437

SECONDARY MATERIALS

Tax Agents Services Bill 2008 – Explanatory Memorandum

Tax Agent Services Regulations – Explanatory Statement

REASONS FOR DECISION

Deputy President R P Handley

  1. Denise Modini (the Applicant) has applied for the review of a decision of the Tax Practitioners Board (the Board) (the Respondent) to reject her application for registration as an individual tax agent under the Tax Agent Services Act 2009 (Cth) (the TAS Act).

    BACKGROUND

  2. On 5 March 2012, Ms Modini applied to the Board for registration as a tax agent and provided documentation supporting her application.  At a meeting on 4 April 2012, the Board decided to reject Ms Modini’s application.  On 4 May 2012, the Board wrote to Ms Modini, notifying her that she was not eligible for registration as a tax agent, and that her application had been rejected.  The stated reasons were that the Board was not satisfied, first, that Ms Modini met “the prescribed requirements relating to qualifications and relevant experience for registration as a tax agent under the Tax Agent Services Regulations 2009” (the TAS Regulations) and, second, that Ms Modini was a fit and proper person within the meaning of the TAS Act “to meet the eligibility requirements for registration as a tax agent under paragraph 20-5(1)(a)” of that Act. On 25 May 2012, Ms Modini applied to the Tribunal for a review of the Board’s decision.

  3. Ms Modini has previously lodged five separate applications for registration as a tax agent with the former Tax Agents’ Board of Queensland (the former Board), under the now repealed s 251JA of the Income Tax Assessment Act 1936 (Cth) (ITAA 1936). These applications were rejected. The most recent decision by the former Board, made…

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AGLC
Modini and Tax Practitioners Board [2012] AATA 772
Case
[2012] AATA 772
Decision Date

CaseChat Overview and Summary

Denise Modini sought a review of the Tax Practitioners Board's decision to reject her application for registration as an individual tax agent. The Tax Agent Services Act 2009 (Cth) mandates that an individual must meet specific requirements to be eligible for registration as a tax agent, including being a fit and proper person and satisfying the relevant experience and qualification requirements. The Board rejected Ms Modini's application, citing concerns about her suitability as a fit and proper person and her failure to meet the required experience criteria. Ms Modini applied to the Administrative Appeals Tribunal for a review of the Board's decision.

The primary legal issues the court had to address were whether Ms Modini satisfied the fit and proper person requirement and the relevant experience requirement for registration as a tax agent under the Tax Agent Services Act 2009. The court had to consider whether Ms Modini's past behavior, as evidenced by her interactions with various professionals and regulatory bodies, demonstrated her capacity to engage in professional and reasoned dialogue, which is essential for a tax agent. Additionally, the court needed to assess whether Ms Modini's experience, including her background as a Certified Practising Accountant and her administrative experience, met the statutory requirements for registration as a tax agent.

The court affirmed the Board's decision, finding that Ms Modini's extensive history of criticism and denigration of others, including her employers and regulatory bodies, indicated an inability to engage in respectful and professional dialogue. This behavior was deemed inconsistent with the professional standards expected of a registered tax agent. The court also found that Ms Modini's experience, while diverse, did not fully meet the statutory requirements for registration. Consequently, the Board's decision to reject Ms Modini's application was upheld.

The court concluded that the Tax Practitioners Board's decision to reject Ms Modini's application for registration as a tax agent was correct, and the review application was dismissed. The court did not make any recommendations regarding Ms Modini's financial circumstances.

Orders

Orders of the court

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Background

Background to the litigation

Denise Modini (the Applicant) has applied for the review of a decision of the Tax Practitioners Board (the Board) (the Respondent) to reject her application for registration as an individual tax agent under the Tax Agent Services Act 2009 (Cth) (the TAS Act). BACKGROUND On 5 March 2012, Ms Modini applied to the Board for registration as a tax agent and provided documentation supporting her application. At a meeting on 4 April 2012, the Board decided to reject Ms Modini’s application. On 4 May 2012, the Board wrote to Ms Modini, notifying her that she was not eligible for registration as a tax agent, and that her application had been rejected. The stated reasons were that the Board was not satisfied, first, that Ms Modini met “the prescribed requirements relating to qualifications and relevant experience for registration as a tax agent under the Tax Agent Services Regulations 2009” (the TAS Regulations) and, second, that Ms Modini was a fit and proper person within the meaning of the TAS Act “to meet the eligibility requirements for registration as a tax agent under paragraph 20-5(1)(a)” of that Act. On 25 May 2012, Ms Modini applied to the Tribunal for a review of the Board’s decision. Ms Modini has previously lodged five separate applications for registration as a tax agent with the former Tax Agents’ Board of Queensland (the former Board), under the now repealed s 251JA of the Income Tax Assessment Act 1936 (Cth) (ITAA 1936). These applications were rejected. The most recent decision by the former Board, made on 12 March 2007, was the subject of a review by the Tribunal. On 2 November 2007, Deputy President Hack decided to affirm the decision under review: Modini and Tax Agents’ Board of Queensland (2007) 98 ALD 466. LEGISLATION The relevant legislation is the TAS Act, which in Part 2, provides for the registration of tax agents. Section 20.5(1) states that an individual is eligible for registration as a registered tax agent if the Board is satisfied that:(a) the individual is a fit and proper person; and (b) the individual meets the requirements prescribed by the regulations (including, but not limited to, requirements relating to qualifications and experience) in respect of registration as a registered tax agent ... Section 20.15 states:In deciding whether it is satisfied that an individual is a fit and proper person, the Board must have regard to: (a) whether the individual is of good fame, integrity and character; and (b) without limiting paragraph (a): (i) whether an event described in section 20-45 has occurred during the previous 5 years; and (ii) whether the individual had the status of an undischarged bankrupt at any time during the previous 5 years; and (iii) whether the individual served a term of imprisonment, in whole or in part, at any time during the previous 5 years. None of the matters referred to in paragraph (b) is relevant here. Section 20.20 provides for applications for registration as a registered tax agent to be made to the Board on an approved form with any documents that are required by the Board and the prescribed fee. Section 20.25(1) requires the Board to grant an application if the applicant is eligible for registration, but otherwise to reject the application.

Evidence

Evidence Before The Court

Deputy President Hack stated:45 …. In the course of the hearing, Ms Modini engaged in an almost endless pattern of denigration of those whose views differed from hers. She spoke of being “less than impressed” by the standards of some sole practitioners for whom she had worked. Of one of her employers she said, “people were phoning there all the time complaining about [him]”. Of another, she said, “personnel agents in Townsville avoid him”. A third “should not have been registered”. A former employee of the Board was, “running his own little secret society”. Her contempt for tax agents whose qualifications she regarded as being less than hers was manifest throughout the hearing. Her written material referred, for example, to the Board “constantly passing applications from people with no professional qualifications and other incompetent people”. She referred to the “gross incompetence” of two members of the Tribunal who had affirmed decisions refusing her earlier applications for registration. 46. It is not necessary for me to reach any conclusions about the subject matter of Ms Modini’s complaints and I do not suggest, for a moment, that anyone, including members of the Tribunal, is, or should be, immune to criticism. However, whether Ms Modini is right or wrong in her views, her criticisms are irrational, unreasonable, and go far beyond the bounds of what might be regarded as being proper or appropriate. The notion of respectful disagreement is entirely foreign to Ms Modini. No criticism of her is warranted (in her view) and when made it is responded to in an abusive and hectoring manner. That pattern appears frequently in the material in the case. 47. Part of the task of a registered tax agent is to deal with officers of the Commissioner of Taxation, often in the context of a disagreement regarding the revenue consequences of a client’s transactions or business. A tax agent is not expected to be deferential to officers, but the dealings between officers and tax agents need to be professional, civil, and rational. Ms Modini’s evidence satisfies me she is not capable of conducting a professional and reasoned dialogue with an officer (or others) with whom she had a disagreement. EVIDENCE Ms Modini has a Bachelor of Arts degree from the University of Sydney and a Bachelor of Commerce degree from James Cook University, the latter awarded on 15 May 1993. She was admitted as a Certified Practising Accountant (CPA) on 23 June 1997 and was granted a Public Practice Certificate in 2001. Ms Modini said that apart from her experience as an accountant, she has also been a registered teacher for 40 years (for example, undertaking casual ‘relief’ teaching), and has considerable administrative experience (for example, working for the Australian Electoral Commission and Queensland Electoral Commission managing polling stations at election time). She is not currently doing any relief teaching because she has moved house and is too far away from one school where she used to teach, and the other school is no longer using the relief teachers they used to employ. In 2008 and 2009, she was relief teaching two or three days a week.

Decision

Reasons for decision

Ms Modini’s evidence indicates that her financial circumstances are undoubtedly straitened. However, in view of my decision, it is not appropriate that I make such a recommendation and I therefore decline to do so.CONCLUSION The decision under review is affirmed.

Ratio Decidendi

Legal Principle Established

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