Musgrave v Director General, Ministry of Transport

[2004] NSWADT 141

CITATION:	Musgrave v Director General, Ministry of Transport [2004] NSWADT 141
DIVISION:	General Division
PARTIES:	APPLICANT David Kevin Musgrave RESPONDENT Director-General, Ministry of Transport
FILE NUMBER:	033358
HEARING DATES:	25/05/2004
SUBMISSIONS CLOSED:	05/25/2004
DATE OF DECISION:	07/12/2004
BEFORE:	Higgins S - Judicial Member
APPLICATION:	Passenger Transport Act - tourist service operator - suspension of accreditation - Tourist Service operator - suspension of accreditation
MATTER FOR DECISION:	Principal matter
LEGISLATION CITED:	Administrative Decisions Tribunal Act 1997 Crimes Act 1900 Passenger Transport (Bus Services) Regulation 2000 Passenger Transport Act 1990
CASES CITED:	Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321 B v Director-General, Department of Transport [2001] NSWADT 203 Commissioner for Fair Trading, Office of Fair Trading v Lindfield (GD) [2004] NSWADTAP 28 Farquarson v Director-General, Department of Transport [1999] NSWADT 53 Hughes and Vale Pty Ltd v State of New South Wales (1955) 93 CLR 127 King v Ministry of Transport [2004] NSWADT 50 Lo v Director-General, Department of Transport [2002] NSWADT 101 Re T and the Director of Youth and Community Services [1980] 1 NSWLR 392 Sterjovski v Director-General, Department of Transport [2002] NSWADT 10 Williams v Director-General, Department of Transport [2001] NSWADT 3
REPRESENTATION:	APPLICANT In person RESPONDENT A Wozniak, solicitor
ORDERS:	The Tribunal orders that the decision of the Director-General be set aside

BACKGROUND

1 An application for review of a decision of a delegate of the Director-General, Ministry of Transport (“the Director-General”) to suspend Mr Musgrave’s operator accreditation pursuant to the Passenger Transport Act, 1990 (“the PT Act”) Mr Musgrave is accredited to operate a tourist and charter bus service.

2 The original decision to suspend Mr Musgrave’s accreditation was made by the Director-General on 19 December 2003 and it was to take effect immediately for a period of two months or until such time as the Notice to Show Cause as to why his accreditation should not be cancelled was finalised. The Notice to Show Cause was forwarded to Mr Musgrave at the same time he was advised of the decision of the Director-General.

3 The basis on which this decision was made was Mr Musgrave’s failure to comply with certain provisions in the Passenger Transport (Bus Services) Regulation 2000, and accreditation standards. In particular, his failure to have a vehicle monitoring device installed in one of his buses, the fact that the vehicle monitoring device installed in his other bus was not operational, his failure to respond to a Notice issued under s.55A of the PT Act and numerous other failures to comply with the declaration that was attached to his application for an operator’s accreditation.

4 On 19 December 2003, Mr Musgrave made an application for review to the Tribunal. He also made an application for a stay of the Director-General’s decision.

5 On 22 December 2003, the Tribunal granted Mr Musgrave a stay of the operation of the Director-General’s decision until the determination of this application. At the same time, the Tribunal set the matter down for hearing on 3 March 2004.

6 On 3 March 2004, when the matter was listed for hearing Mr Wozniak, who appeared on behalf of the Director-General, informed the Tribunal that the Director-General was relying on additional grounds for the suspension of Mr Musgrave’s operator’s accreditation. The additional grounds were 153 offences under s.178BD of the Crimes Act 1900, for fraudulently producing Taxi Transport Scheme Subsidy (“TTSS”) vouchers to the Ministry of Transport and receiving payment for those vouchers. As Mr Musgrave had not had an opportunity to consider these charges, the matter was adjourned to 25 May 2004 for further hearing.

7 Prior to the hearing, the Director-General filed and served an amended statement of reasons, which incorporated the abovementioned changes.

JURISDICTION

8 Section 38 of the Administrative Decisions Tribunal Act 1997 (“ADT Act”) confers jurisdiction on the Tribunal to review certain administrative decisions. That section, so far as is relevant, provides as follows:

“s.38(1) The Tribunal has jurisdiction under an enactment to review a decision (or a class of decisions) if the enactment provides that applications may be made to it for a review of any such decision (or class of decisions) made by an administrator:

(a) in the exercise of functions conferred or imposed by or under the enactment; or

(b) in the exercise of any other functions of the administrator identified by the enactment”.

9 The term “enactment” is defined in s.5 of the ADT Act to mean an Act other than the ADT Act. In this application, the decision for which review is sought is a decision that was made under s.10(1) of the PT Act. Section 52(1) of the PT Act makes provision for a person to make an application to the Tribunal for review of a decision made under that Act, to refuse, vary, suspend or cancel the persons’ accreditations, authority or authorisation. This includes a review of a decision to suspend an accreditation pursuant to s.10 of the PT Act. That is, a decision to suspend an accreditation under the PT Act is a “reviewable” decision for the purpose of s.38 of the ADT Act.

10 Accordingly, the decision of the Director-General to suspend Mr Musgrave’s accreditation is a decision that the Tribunal has jurisdiction to review.

11 However, s.55(1)(b) of the ADT Act provides that a person cannot make an application for the review of a “reviewable” decision unless an internal review is taken to have been finalised pursuant to s.53(9) of the ADT Act.

12 In this case, at the time Mr Musgrave made his application, no internal review had been requested or made.

13 In Commissioner for Fair Trading, Office of Fair Trading v Lindfield (GD) [2004] NSWADTAP 28, the Appeal Panel recently considered the question of the Tribunal’s jurisdiction to hear and determine an application for review where no internal review had been requested, let alone finalised. The Appeal Panel found (at [11]) that:

“…it is a mandatory pre-condition to the exercise of jurisdiction that there be an internal review determination”.

14 The Appeal Panel went on to state that the Tribunal may dispense with the requirement if it is satisfied of the matters set out in s.55(2)(c) of the ADT Act. That section, so far as it is relevant, provides as follows:

“s55(1) A person may apply to the Tribunal for a review of a reviewable decision only if:

(a) the application is made by an interested person, and

(b) an internal review is taken to have been finalised under section 53(9), and

(c) ...

(d) ...

(2) However, subsection (1) (b) or (d) does not prevent a person from making an application in respect of a reviewable decision that has not been the subject of an internal review under section 53 if the Tribunal is satisfied that:

(a) ...

(b) ...

(c) it is necessary for the Tribunal to deal with the application in order to protect the person’s interests and the application to the Tribunal was made within a reasonable time following the decision of the administrator concerned”.

15 On the material before the Tribunal, notwithstanding the fact that an internal review had not been finalised at the time Mr Musgrave made his application for review, I find that he made his application for review within a reasonable time after he was informed of the Director-General’s decision, and as that decision was effective immediately, the circumstances were such that it was and is necessary to deal with his application in order to protect his rights.

RELEVANT LEGISLATION

16 Section 10 of the Passenger Transport Act, 1900 (“PT Act”) gives the Director-General power to vary, suspend or cancel a person’s accreditation. That section provides as follows:

“s.10(1) Having regard to the purpose of an accreditation, the Director General may at any time vary, suspend or cancel any person’s accreditation

(2) The accreditation of a corporation is automatically cancelled when there is no designated director or manager for the purposes of s.7(2)(a).”

17 The purpose of an accreditation is set out in ss.8(2). That section provides as follows:

“s.8(2) The purpose of accreditation under this Division is to attest:

(a) that the accredited person is (or, in the case of an accredited corporation, the designated directors and managers of the corporation are) considered to be of good repute and in all other respects fit and proper to be responsible for the operation of a public passenger service; and

(b) that the authorised person has demonstrated the capacity to meet the Government’s standards of:

(i) financial viability; and
(ii) safety of passengers and the public; and

(iii) vehicle maintenance,

to the degree and in the manner required in respect of services of the kind specified in the accreditation.”

18 Mr Wozniak, on behalf of the Director-General, relied on the material that had previously been filed and served by the Director-General. This material included a copy of the Department’s file on Mr Musgrave’s accreditation, a copy of the 153 charges that had been laid against Mr Musgrave in respect to the TTSS vouchers and a statement of facts in respect of those charges.

19 Mr Musgrave gave oral evidence and was cross-examined by Mr Wozniak. The essence of his evidence was as follows:

(a) He is the holder of a bus, taxi and hire car driver authority under the PT Act. He has held a bus driver authority for 22 to 23 years, a taxi authority for 15 to 16 years, and a hire car authority for 3 to 4 years. He has not been the subject of any complaints in respect of these authorities.

(b) He made an application for an operator’s accreditation in March 2002. That application was approved in April 2002. Since he received his accreditation, Mr Musgrave has operated two buses. They are smaller sized buses, with one bus licensed to carry no more than 8 passengers. He has 5 full-time drivers and 5 part-time drivers that he calls on when he needs to. His buses are used to transport passengers to dinner functions, bucks nights, cruises, airport pick up and drop off. In addition to this he provides transport services to hotels and corporations for their customers.

(c) In respect of the vehicle monitoring devices, Mr Musgrave stated that he had always been under the impression that these were not required for the type of buses he was driving and the type of work he was carrying out. In particular, it was his understanding that trips of less than 80 kilometres did not require such devices. It was not until 10 October 2003, when his bus was inspected by the Ministry’s inspectors, that he realised that this was a requirement. As a consequence, on 21 October 2003, he arranged for such a monitoring device to be installed in the bus that had no such device in it.

(d) Mr Musgrave acknowledged that he had received a warning from the Director-General on 14 October 2003. He also acknowledged that he had been operating the bus with a defective vehicle monitoring device, after he had received the warning. This was for a period of 4 days. It was his contention that such a device was not needed, as this bus was used primarily as a courtesy bus for the transport of patrons from the Wentworthville Leagues Club to their homes, which was no more than 5 kilometres away. The arrangement he had with the Club was that the Club paid for his drivers, the insurance of the bus, together with the registration of the vehicle. In support of his contention, Mr Musgrave filed a report, dated May 2002, of the Ministry of Transport, relating to a review of the regulatory framework for community and courtesy transport services in New South Wales. This review suggested that a less rigorous regulatory regime should apply to such services.

(e) In November 2003, Mr Musgrave bought an additional component for the defective vehicle monitoring device on his bus. He stated that each bus now had fully operational vehicle monitoring devices, and Mr Musgrave was in a position to produce the necessary records from these devices.

(f) In addition to rectifying the vehicle monitoring devices in his buses, Mr Musgrave has attended to all the other matters raised by the Director-General in his initial decision to suspend his operator’s accreditation.

(g) In respect of the s.178BD charges, Mr Musgrave stated that he will be vigorously defending these charges. He admitted that he had been accepting TTSS vouchers for disabled passengers that he had transported in his small bus. It was his belief that he was entitled to make a claim in respect of these journeys. He stated that he no longer used such vouchers, and that they only represented 10-15% of his overall business.

20 Copies of the 153 charges laid against Mr Musgrave were tendered into evidence. I note that the charges cover the period of 13 May 2003 to 13 June 2003, and the amounts involved in each charge varied between $60.00 and $90.00. According to the fact sheet tendered by Mr Wozniak, these charges were only representative of the extent of the alleged fraud. It was stated that there were 481 vouchers presented by Mr Musgrave in the period 31 May 2003 to 2 August 2003, and involved the payment of $14,381.45 to Mr Musgrave which it is alleged he was not entitled to.

21 The fact sheet also states that on each voucher, the driver’s name was recorded as “Dave” and the recorded taxi registration number was that of one of Mr Musgrave’s buses. It also states that when contacted about the vouchers, Mr Musgrave admitted to completing the vouchers and stating that he had been authorised to do so.

SUBMISSIONS

22 Mr Musgrave submitted that there was no basis to suspend his operator’s accreditation. The matters on which the Director-General relied on originally to suspend his accreditation had all been rectified. He went on to submit that his use of the TTSS vouchers had not been dishonest. Furthermore, he had been working in the passenger transport industry for over 20 years, and during this time there has been no complaint made about him.

23 Mr Wozniak acknowledged that the matters of concern raised in the Director-General’s initial Notice of Suspension were no longer serious, as they had each been addressed. However, it was his submission that the numerous charges, under s.178BD of the Crimes Act, were sufficiently serious to warrant the suspension of Mr Musgrave’s accreditation. In particular, he argued that the particular vouchers expressly stated on them that the subsidy scheme only related to taxi services. There was no mention of bus services, and Mr Musgrave had been in the industry for a sufficient number of years to understand the difference. He also pointed out that the vouchers, completed by Mr Musgrave, each required details of the taxi registration number to be inserted. In this case, Mr Musgrave put in a number he knew not to be a taxi registration number.

REASONS AND DECISION

24 The role of the Tribunal is to determine whether the decision of the Director-General to suspend Mr Musgrave’s operator’s accreditation is the correct and preferred decision having regard to the relevant facts and the applicable law (s.63 ADT Act). In this case, the relevant decision is the original decision of suspension, with the grounds for that decision including the charges that were subsequently laid against Mr Musgrave.

25 The meaning of “good repute” has been canvassed in several cases. Wattle J in Re T and the Director of Youth and Community Services [1980] 1 NSWLR 392 at 393 said that:

“A person’s reputation, in fact and in law, is to be found in the estimate of his moral character entertained by some specific group of people, such as those who live in the neighbourhood of his residence, those who work with him or those with whom he associates in his occupation or profession… Evidence of conviction for a criminal offence is, however, admissible as evidence, indeed, most cogent evidence of bad reputation”.

26 The Tribunal has also considered the meaning of a “fit and proper person” on numerous occasions and has followed the reasoning of Chief Justice Mason in Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321 at [63] where he stated:

“The question whether a person is fit and proper is one of value judgment. In that process the seriousness or otherwise of particular conduct is a matter for evaluation by the decision maker. So too is the weight, if any, to be given to matters favouring the person whose witness and propriety are under consideration”.

27 In the decision of Farquarson v Director-General, Departmentof Transport [1999] NSWADT 53 at [27], the President stated:

“A taxi driver has a continuing responsibility to ensure that he is of ‘good repute’ and a ‘fit and proper person’. Clearly the laying of serious criminal charges bears on the reputation of an individual and may raise questions as to a person’s character. The concepts of ‘good repute’ and ‘fit and proper character’ involve different considerations. The former concept goes to the way in which the person is regarded by others in the community (fairly or unfairly), while the latter concept goes to an individual’s intrinsic characteristics, whether they are known to others or not”.

28 The President went on to state at [28] that even an acquittal of the criminal charges may leave unresolved in an administrator’s mind questions as to the reputation and integrity of a licensed individual. The President stated the following in respect of the Director-General’s power to suspend an authority:

“Powers of suspension are, by their nature, designed to provide a temporary form of intervention pending further development or further consideration or action by the administrator. A power of suspension, as compared to outright cancellation, does carry the (marginal) benefit for the licensee in not placing at risk the license itself”.

29 The discretion to suspend a licence or authority must be exercised, keeping in mind the activities, which the person is authorised to undertake, and the objectives of regulating those activities (see Hughes and Vale Pty Ltd v State of New South Wales (1955) 93 CLR 127 at 156 and Bond v Australian Broadcasting Tribunal (supra). In this case, Mr Musgrave is authorised to operate and drive a public passenger bus and the objectives of regulating this activity are those set out in s.4 of the PT Act, which includes paragraph (e) which provides:

“(e) to encourage public passenger services that meet the reasonable expectations of the community for safe, reliable and efficient passenger transport services, …”

30 Accordingly, in exercising his responsibilities under the PT Act, the Director-General must take account of likely perceptions of the travelling public if they find themselves travelling with a person suspected of and charged with a criminal offence (see Farquason at [36]).

31 Earlier in his decision in Farquason, at [20], the President made the following statement in respect of the power to suspend a licence where a person is charged with an offence:

“Regulatory schemes which provide for the issuance of licences on the basis of satisfaction as to licensee’s fitness and character usually include, as part of the continuing oversight powers, a power to suspend the licence for public interest reasons. Whilst it is the case that a person charged with a criminal offence must be presumed innocent until proven guilty it does not follow the consequences that lie outside the criminal law may be avoided. Civil consequences typically attach to the laying of criminal charges in various categories of public sector employment. Commonly, a public sector employee may be stood down with or without pay depending on the statutory provisions.”

32 The President went on to state at [22]:

“In considering whether to exercise any discretion to suspend or otherwise interfere with the licence an administrator cannot reasonably be expected to enquire into the strength or weakness of the case against the licensee ... Similarly a review tribunal cannot be expected to go behind the information on which the administrator has relied to the extent of examining the strengths and weaknesses of the prosecution case.”

33 The decision in Farquarson has been followed in other decisions of the Tribunal, in particular in B v Director-General, Department of Transport [2001] NSWADT 203; Williams v Director-General, Department of Transport [2001] NSWADT 3; Lo v Director-General, Department of Transport [2002] NSWADT 101; King v Ministry of Transport [2004] NSWADT 50; and Sterjovski v Director-General, Department of Transport [2002] NSWADT 10.

34 In my opinion the decision of Farquarson correctly states the law in that the Tribunal cannot reasonably be expected to enquire into the strength or weakness of the charges against Mr Musgrave for the purpose of reviewing the Director-General’s decision to suspend his licence. In my opinion, on the basis of Farquarson, and decision that have followed it, the relevant factors to be taken into account are:

(a) the seriousness of the allegations which have been made against Mr Musgrave;

(b) the circumstances in which the conduct is alleged to have occurred;

(c) the fact that charges have been laid, but there has been no finding of guilt;

(d) previous complaints against Mr Musgrave in respect of the authorities he has held under the PT Act; and

(e) Mr Musgrave’s otherwise previous good character.

35 As I have already mentioned, Mr Musgrave denies the criminal charges that have been laid against him, and he will be given every opportunity to defend them when they are ultimately heard. However, in light of the number of charges laid, it is unlikely that these proceedings will be concluded for some time.

36 I agree with Mr Musgrave’s submission that the basis on which the Director-General originally suspended his accreditation can no longer be supported as each of the matters complained of had been rectified. This leaves the charges which have subsequently been laid in respect of the TTSS vouchers completed and submitted by Mr Musgrave.

37 In my opinion, these allegations are serious charges as they involve a systematic course of conduct over a period of time and involves a substantial amount of money. The alleged offences also relate to conduct which occurred in the performance of his duties as an accredited operator under the PT Act, and they reflect on his honesty.

38 However, it is not disputed that Mr Musgrave provided passenger transport services to the persons named in each TTSS voucher and that these persons were entitled to a subsidiary under the TTSS scheme. That is, the customers or consumers were not disadvantaged in any way. The persons who have been disadvantaged, if the charges are proven, is the taxpaying public at large. It was also not disputed that since July 2003 Mr Musgrave has ceased using the vouchers and that there is almost no likelihood of Mr Musgrave again using such vouchers in an unauthorised way.

39 It was not disputed that during Mr Musgrave’s considerable period in the public passenger transport industry that he has not been the subject of complaint, other than those incidents that gave rise to the suspension that is the subject of this application.

40 As the Deputy President stated in Williamson (supra), the suspension of an authority is justified where the person’s reputation or fitness to drive is sufficiently compromised by allegations or findings of impropriety for it to be in the public interest that the person not drive until those issues are addressed or resolved.

41 In my opinion, in light of the fact that:

(a) Mr Musgrave has denied the charges;

(b) the hearing and determination of these charges are unlikely to be determined for some time;

(c) the offences did not place any member of the public at risk;

(d) the conduct constituting the offences ceased immediately after Mr Musgrave was questioned and they are unlikely to re-occur; and

(e) Mr Musgrave has had 20 years in the passenger transport industry without complaints being laid against him,

42 Mr Musgrave’s reputation and fitness to operate a passenger bus service has not been sufficiently compromised by the charges for it to be in the public interest and that his operator’s accreditation be suspended until the determination of these charges.

43 Accordingly, for the reasons set out above, in my opinion, the decision of the Director-General to suspend Mr Musgrave’s operator’s accreditation is not the correct and preferred decision.

44 The Tribunal orders that the decision of the Director-General be set aside.