NSW Vocational Education and Training Accreditation Board v Focal Holdings Pty Ltd (GD)

[2011] NSWADTAP 11

Administrative Decisions Tribunal

New South Wales

Medium Neutral Citation:

NSW Vocational Education and Training Accreditation Board v Focal Holdings Pty Ltd (GD) [2011] NSWADTAP 11

Hearing dates:

31 January 2011

Decision date:

31 January 2011

Before:

Deputy President D Patten
N Isenberg, Judicial member
R Fitzgerald, Non judicial member

Decision:

1. Appeal dismissed

2. Application for leave to appeal on merits dismissed

3. Orders made by Tribunal on 14 September 2010 confirmed

4. No order as to costs but leave reserved to parties to make submissions

Catchwords:

Appeal - No error of law shown - Leave to extend to the merits refused

Legislation Cited:

Vocational Education and Training Act 2005
Vocational Education and Training Accreditation Act 1990

Cases Cited:

Commissioner of Police v Fortuna [2010] NSWADTAP 51
Minister for Aboriginal Affairs v Peko Wallsend (1986) 162 CLR 23
Picture House Ltd v Wednesbury Corporation [1948] 1KB 223
Roberts v Hopwood [1923] AC 578

Category:

Principal judgment

Parties:

NSW Vocational Education and Training Accreditation Board (Appellant)
Focal Holdings Pty Ltd (Respondent)

Representation:

Counsel
M Cleary (Respondent)
NSW Vocational Education and Training Accreditation Board (Appellant)
Pryor Tzannes & Wallis (Respondent)

File Number(s):

109054

 Decision under appeal 

Citation:

Training Accreditation Board v Focal Holdings Pty Ltd v NSW Vocational Education and Training Accreditation Board [2010] NSWADT 226

Date of Decision:

2010-09-14 00:00:00

Before:

General Division

File Number(s):

103010

Reasons for Decision

1. This is an appeal against a decision of the Tribunal in its General Division published on 14 September 2010. At the conclusion of the hearing we made the following orders:

1. Appeal dismissed.

2. Application for leave to appeal on merits dismissed.

3. Orders made by Tribunal on 14 September 2010 confirmed.

1. What follows are the reasons for those orders.

1. The appellant (VETAB) is the regulatory authority established under the Vocational Education and Training Act 2005 (VET Act). The respondent (Focal) was registered in 1995 as an education or training provider under the Vocational Education and Training Accreditation Act 1990 (the 1990 Act) and under the 1990 Act was approved to provide courses for overseas students. Such registration and approval were in force immediately before the repeal of the 1990 Act by s53 of the VET Act and accordingly by cl 4 of Schedule 2 to the VET Act Focal is taken to be a registered training organisation for the purposes of the VET Act and an approved provider of courses for overseas students under that statute.

1. In 2007 issue arose between the parties concerning the number of students Focal was entitled to admit to its courses and as to the premises from which it may operate. At that time Focal was operating from premises at Greenfield Parade Bankstown from which another training organisation Inter-Continental Colleges Pty Ltd was also operating. There was a mediation on 7 February 2007 at which the parties agreed to the following terms:

1. That Inter-Continental Colleges Pty Ltd approval for delivery at 7 Greenfield Parade Bankstown (the premises) be changed to 30 students ("X").

2. That Focal Holdings Pty Ltd approval for delivery at the premises be changed to 350 students ("Y").

3. The total number of 380 students is over three shifts.

4. The nominated figures for "X" and "Y" may be adjusted by written notice to VETAB with VETAB acknowledging that the two providers are operated by the same or similar management, and VETAB undertakes that it will not unreasonably withhold consent for the adjustment.

5. Focal Holdings will provide by 30 June 2007 a timetable for the courses for the period 1 July 2007 to 31 December 2007.

1. The following paragraphs of the Tribunal's reasons demonstrate that the terms of settlement did not encompass all the matters discussed at the mediation and illustrate the dispute which gives rise to this appeal:

18 Discussions took place at the mediation in relation to other sites from which Focal was operating. Ms Absolon (the principal of Focal) said that it was agreed orally at the mediation that VETAB would "not unreasonably withhold approval" in relation to those sites. Mr Cribb put to Ms Absolon that that was not agreed and that if it had been agreed, it would have featured in the Terms of Settlement. It was suggested to Ms Absolon that she may have been confusing VETAB's agreement not to "unreasonably withhold consent" for an adjustment between number of students at Focal and the number at another College (see paragraph 4 of the Terms of Settlement). Ms Absolon disagreed.

19 It is clear from a passage in a letter that Ms Absolon wrote to VETAB dated 2 December 2008 that Mr Cribb's suggestion as to the source of her confusion is correct. In that letter at page 3, Ms Absolon refers to an "adjustment" of the student numbers:

The mediation agreement provided that VETAB would not unreasonably withhold consent for the adjustment of student capacity approval, which in our view VETAB has done in not so much as considering our applications, or giving account of Sarah Dew's inspection of Focal's off site premises.

20 Ms Absolon's reference to the mediation agreement and her use of the term "adjustment" makes it clear that she has misinterpreted or misunderstood paragraph 4 of the Terms of Settlement. That paragraph relates to an adjustment as between Focal and Inter-Continental Colleges Pty Ltd. It does not say that new applications for approval to provide courses at sites other that Greenfield Parade would not be unreasonably withheld.

21 On the basis of this letter, we are satisfied that there was no written or verbal agreement between Focal and VETAB at the mediation that VETAB would "not unreasonably withhold" approval to operate at new sites.

22 At the mediation VETAB's officers provided Ms Absolon with an application form for approval to teach overseas students from the other sites. Ms Absolon said that that was the first time she was aware that VETAB required her to complete an application form. We accept that evidence. Ms Absolon said that it was her understanding that after she completed that form a VETAB officer would inspect the premises. While we accept that that was Ms Absolon's understanding at the time, the correspondence she received from VETAB following the mediation could have left her in no doubt that she was required to apply in proper form before any inspection would take place.

23 Ms Absolon did not complete the form because she suspected that VETAB was singling her out for special treatment. She was suspicious because the form was not generally available on the web-site. Ms Dew explained that the form was not put on the website until April 2008 but that it was in use prior to that time. We are satisfied that VETAB was using the form it provided to Ms Absolon at the mediation and she was not being treated any differently from other registered organisations.

24 Following the mediation, Ms Absolon wrote to Ms Willis, the Director of VETAB, on 20 March 2007. In that letter she attached the relevant floor plans for the additional premises and provided information about their size and capacity. Ms Absolon wrote that:

We also note that you indicated that we were to provide you with additional documentation to substantiate the request for additional student numbers. However, we noted that the training areas at these premises are not being used to teach any courses/qualifications other than those already on our scope. The form that you provided at the mediation meeting requests the submission of complete audit documentation which simply duplicates all the documents that have been sighted and deemed compliant by VETAB auditors over the period of the protracted audit from April 2005 to date. We submit, therefore, that there is no requirement for us to provide Learning and Assessment Strategies, resources, teaching matrix, timetables, etc, a second time as these areas have all been assessed by the VETAB auditors as "compliant".

25 She concluded the letter by asking Ms Willis if she could arrange for auditors to inspect the premises as a matter of urgency and increase the number of overseas students accordingly.

26 Ms Willis responded on 30 March 2007 advising that the applications were not in the form required, were not in good order and were incomplete. She wrote that an application form attaching supporting documents must be completed for each additional site. She quoted s 34(3) of the VET Act which states that:

An application for approval to provide courses for overseas students must be in such form, and be accompanied by such fee, as the Board may determine.

27 Ms Willis also noted Ms Absolon's view that additional documentation was not required as the premises are to be used to teach courses/qualifications that have already been approved. She made it clear in the letter that further documentation was required because VETAB must take into account more than just the space allocated to the delivery of training qualifications and courses. In particular, VETAB must assess whether the particular requirements of the qualification or accredited courses are being met. She reiterated that an application form with supporting documentation needed to be provided for each additional site.

28 On 2 April 2007 Ms Absolon responded to this letter expressing the view that s 34(3) of the VET Act applies to applications for approval to provide courses to overseas student and does not require an application to be made to increase the number of students that can be enrolled. Ms Absolon pointed out that Focal already had approval to provide courses for overseas students and that it was not requesting any additional courses. She concluded the letter by saying:

We enclose the completed forms identifying the various locations and sizes of the premises on which we seek increases in student numbers. Copies of the relevant signed agreements for the use of the relevant premises can be sighted during the inspection of the relevant premises. An inspection of the premises should satisfy VETAB as to the physical resource capacity of the relevant sites. As we already have our courses approved for CRICOS as per section 34(3) of the VET Act 2005 we believe there is no justification on VETAB's part for insisting that we resubmit all the documentation on the checklist supplied by VETAB.

29 Ms Absolon did not enclose with that application a set of Learning and Assessment Strategies for each qualification, copies of leases and/or agreements, policies and procedures, trainers matrix, timetables etc as had been requested. She told the Tribunal that she thought that VETAB had all the documentation it needed and she believed it was an unreasonable request. She said she co-operated by submitting a request in writing for site approval and by submitting the floor plans but not the other documents that had been requested. Nevertheless, Ms Absolon admitted that she could have provided the requested documents.

30 VETAB did not respond to Ms Absolon's letter. We note that VETAB could have exercise its power under s 34(7)(a), to refuse the application for approval on the ground that "the applicant has not furnished such further information in relation to the application as the Board requires." Instead VETAB did not determine the application. Nevertheless, Ms Absolon agreed that as of shortly after 30 March 2007, when she received Ms Willis' letter, she was on notice that VETAB required her to provide the requested documentation. She also agreed that she did not submit all the information that Ms Willis had requested. In our view, Ms Absolon's attitude to VETAB's requests to apply for approval was unjustifiably combative.

31 As its registration and approval were due to expire, Focal submitted an application for renewal of registration and CRICOS re-approval on 1 April 2008. VETAB appointed Ms Sarah Dew to conduct a desk-based audit. The application did not seek an increase in approved student capacity. Ms Dew conducted the desk audit on 2 October 2008. As at that date PRISMS data identified that 2,098 students were enrolled. Ms Dew's compliance audit report was sent to Focal on 4 November 2008. Ms Absolon's failure to apply for the relevant approval is another example of her unco-operative attitude to VETAB's legitimate requests.

32 Meanwhile, in May 2008, Ms Absolon says that Focal imposed its own moratorium on enrolling new students for commercial reasons. In Ms Absolon's words, Focal decided to 'take stock, from a commercial perspective, to make sure that premises were adequate and that there were sufficient qualified staff.' She said that that decision had nothing to do with VETAB. This explanation highlights Ms Absolon's lack of respect for VETAB as the regulating authority. Rather than concede that she was acting outside the scope of her approval to provide courses to overseas students, she chose to characterise the moratorium on student enrolments as a purely commercial decision, inferring that it was for her and her alone to determine the number of students that should be enrolled.

33 On 24 June 2008 a meeting was held at Focal's Greenfield Parade site with representatives from the Commonwealth Department of Education, Employment and Workplace Relations. The purpose of the meeting was to discuss the fact that 2,200 overseas students were enrolled at that time, even though Focal only had approval for 350 students. Ms Absolon and Lisa White, Focal's administration manager, attended that meeting. Ms Dew attended as an observer. It was put to Ms Dew that there were two issues discussed at the meeting; the current level of enrolments, and the fact that Focal had imposed its own moratorium on enrolling new students from May 2008. Ms Dew admitted that the issue of over enrolments had been discussed and agreed that over 2,000 students were enrolled at the time. Ms Dew cannot recall a conversation about a self-imposed moratorium but said that since the meeting she has read that Focal said it had imposed such a moratorium. We accept that Ms Dew cannot recall that conversation but find, in accordance with Ms Absolon's recollection, that that matter was discussed.

34 On 19 September 2008, Dr Shaw, Director of the Education Services for Overseas Students (ESOS) Provider and Support and Compliance Unit wrote to Ms Absolon suggesting that because of the over-enrolment issue, Focal agree not to create any new enrolments in any of its courses for 3 months. Dr Shaw said that "Focal's agreement to implement this option would help minimise the risk that overseas students could be adversely affected by any outstanding issues of compliance with Standard 14 of the National Code and/or with state legislation, to be determined by VETAB." Focal did not agree to this suggestion. This failure is another example of Ms Absolon's belief that it was acceptable for her not to comply with recommendations or requirements of the regulators, if she did not regard them as legitimate or in accordance with her interests.

35 On 4 November 2008 VETAB wrote to Ms Absolon advising that the audit report had been completed. The conclusion reached in that report was that certain matters including Focal's breach of the student capacity limit and operating from unapproved sites, were serious enough to recommend immediate suspension as a provider of courses to overseas students. Ms Absolon responded to that letter on 2 December 2008 taking issue with many of VETAB's findings. In particular, Ms Absolon submitted that while VETAB has a discretion to approve a provider's maximum capacity, it does not have the power to "unduly restrict an organisations training operations by limiting its enrolments". While conceding that VETAB has the discretion to approve a provider's maximum capacity, Ms Absolon appears to be suggesting that VETAB does not have the power to limit enrolments if that is not in the interests of the organisation. This comment reflects Ms Absolon's view that VETAB should not interfere with her operations.

36 On 7 September 2009 VETAB formally advised Ms Absolon that Focal's registration had been cancelled. One reason for the cancellation was that Focal had 1,389 overseas students enrolled and studying at various sites despite only having approval for 350 students to be enrolled and studying at the Greenfield Parade site. Furthermore, despite being asked to do so, Focal had not submitted an application in proper form for an increase in those numbers.

37 Ms Absolon agreed that VETAB had authority to approve sites from which courses could be provided to overseas students and that by 24 July 2006 she had obtained that approval in relation to the premises at Greenfield Parade. When pressed, Ms Absolon agreed that VETAB had not granted approval in relation to any other sites. She said that VETAB had not approved Focal to provide courses to overseas students from any other sites because its officers had not taken up her invitation to assess those sites. Ms Absolon said that her responsibility was merely to notify VETAB of the fact that Focal was operating from other sites. It was then up to VETAB to assess those premises. Ms Absolon denied that VETAB had told her what the process was to be and that she had ignored it. However, we are satisfied that from the date of the mediation on 7 February 2007, Ms Absolon was aware that VETAB required her to apply for approval for sites at which Focal provided courses for overseas students and a student capacity in respect of those sites. We also find that Ms Absolon was aware as of at least 30 March 2007 that VETAB required her to provide a complete set of documentation in support of that application.

38 Ms Absolon declined to comply with Board's requests and continued to operate from sites other than Greenfield Parade. It was not until nearly 3 years later, when Focal's registration and approval had been cancelled, that Focal applied in proper form for approval of those sites and an increase in student capacity.

1. The powers of VETAB in respect of registered training organisations and approved providers are wide. Specifically the power to cancel suspend or amend registration and the power to amend suspend or cancel an approval to provide courses for overseas students are contained respectively in sections 18 and 35 of the VET Act. These sections provide:

18 Board may cancel, suspend or amend registration

(1) The Board may do any one or more of the following:

(a)impose or amend the conditions recorded on the National Register in relation to a training organisation that has been registered by another registering body so as to restrict the operations of the training organisation in this State,

(b)amend the scope of registration or recorded conditions of a training organisation that has been registered by the Board so as to restrict the operations of the training organisation in this State or any other jurisdiction,

(c)suspend the registration, or part of the scope of registration, of a training organisation that has been registered by the Board,

(d)cancel the registration of a training organisation that has been registered by the Board.

(2) The Board may only take action under subsection (1) in relation to an RTO on any one or more of the following grounds:

(a)the training organisation requests the suspension or cancellation of its registration,

(b)the training organisation is no longer providing the courses in respect of which it is registered,

(c)the training organisation has ceased to exist,

(d)the training organisation has failed to comply with the RTO standards or the registration and accreditation guidelines,

(e)the training organisation's financial arrangements or ethical standards are such that they would not warrant the registration of the training organisation if it were now to apply for registration,

(f)a reasonable doubt exists as to the training organisation's financial capacity to continue to meet its contractual obligations to its students, staff or other persons,

(g)the training organisation does not have the resources to competently provide the courses in respect of which it is registered,

(h)the resources of the training organisation do not comply with the RTO standards or the registration and accreditation guidelines,

(i)the training organisation has contravened this Act or a condition to which its registration is subject.

(3) The Board may not impose a restriction under subsection (1) (a) unless the registering body that registered the training organisation:

(a)fails to take any step to deal with the matter to which the grounds relate within 30 days after the matter comes to its attention, or

(b)fails, after taking any step to deal with the matter to which the grounds relate, to take another step within 30 days.

(4) Subsection (3) does not apply if the Board:

(a)is relying on a ground established by a compliance audit, or

(b)is satisfied that it is in the public interest to impose the restriction immediately.

(5) A restriction or suspension imposed under subsection (1) (a), (b) or (c) may, but need not, relate to a particular place or jurisdiction, but if it does so, it may only be imposed because of a particular fact situation that has arisen in that place or jurisdiction.

(6) A restriction or suspension imposed under subsection (1) (a), (b) or (c) must be consistent with this Act and the RTO standards.

(7) Before cancelling the registration of a training organisation under subsection (1) (d), the Board must consult the registering bodies of each of the other jurisdictions where the RTO is operating.

(8)Failure to comply with subsection (7) does not affect the cancellation. Also, the Board is not required to comply with subsection (7) if the Board is satisfied that it is in the public interest to immediately cancel the registration of the training organisation.

(9)A restriction or suspension imposed under this section may be lifted at any time by the Board on payment of such fee as may be determined by the Board and if the Board is satisfied that such requirements as may be determined by the Board have been complied with.

...

35Amendment, suspension or cancellation of approval

(1) The Board may, on its own motion or on the application of any person, do any of the following in relation to an approved provider:

(a)amend the approval so that it applies to different courses,

(b)revoke or amend any condition to which the approval is subject,

(c)impose additional conditions on the approval,

(d)suspend or cancel the approval.

(2)The suspension of an approval may be lifted at any time by the Board. Before lifting the suspension, the Board may require the payment of a fee determined by the Board.

(3)The Board may not suspend or cancel an approval except on one or more of the following grounds:

(a)the approved provider requests the suspension or cancellation,

(b)the approved provider is no longer providing courses for overseas students,

(c)the approved provider has ceased to exist,

(d)the approved provider has failed to comply with the approval guidelines,

(e)the approved provider's financial arrangements or ethical standards are such that they would not warrant the approval of the provider if it were now to apply for approval,

(f)a reasonable doubt exists as to the approved provider's financial capacity to continue to meet its contractual obligations to its students, staff or other persons,

(g)the approved provider does not have the resources to competently provide the courses to which the approval relates,

(h)the resources of the approved provider do not comply with the approval guidelines,

(i)in the case of a course that includes matter the subject of proprietary rights (such as copyright)-that the approved provider is not lawfully entitled to the benefit of those rights,

(j)the approved provider has engaged in misleading or deceptive conduct in connection with the recruitment of intending overseas students,

(k)the approved provider has failed to comply with a requirement of the Education Services for Overseas Students Act 2000 of the Commonwealth, or of a regulation under that Act, in relation to the courses to which the approval relates,

(l)the approved provider has contravened this Act, the regulations or a condition to which the provider's approval is subject.

1. In exercise or purported exercise of its powers VETAB on 17 August 2009 made 5 decisions (the subject decisions) viz:

a) cancel Focal's registration as a training organisation: VET Act , s 18(1)(d);

b) refuse Focal's application for renewal of registration as a training organisation: VET Act , s 12(1)(b);

c) cancel Focal's approval to provide courses to overseas students: VET Act , s 35(1)(d);

d) refuse Focal's application for renewal of approval to provide courses to overseas students: VET Act , s 34(1); and

e) impose a condition on Focal to prevent it from recruiting or enrolling any new students: VET Act , s 35(1)(c).

1. As the Tribunal pointed out in paragraph 2 of its reasons each of the decisions is reviewable by the Tribunal by virtue of s47 of the VET Act. By the time the matter was heard by the Tribunal a number of matters relied upon by VETAB in making the subject decisions and in a subsequent internal review had been abandoned. The only issues left to the Tribunal were whether within s18(2)(e) Focal's " financial arrangements or ethical standards are such that they would not warrant registration of the training organisation if it were now to apply for registration" and whether within S35(3)(e) Focal's "financial arrangements or ethical standards are such that they would not warrant the approval of the provider if it were now to apply for approval".

1. Although it seems to us at least arguable having regard to the context of subsections 18(2) and 35(3) and the positioning of paragraph (e) in both of them that Parliament intended it to relate only to matters of a financial nature this was not argued before either the Tribunal or this Panel and we put the matter to one side.

1. The Tribunal approached the issues before it by first considering the meaning of the word "ethical" which it took from the Macquarie Dictionary 3 rd edition:

"1. Relating to or dealing with morals or the principles of morality, relating to right and wrong in conduct

2. In accordance with the rules or standards for right conduct or practice especially the standards of a profession".

There is no challenge to the Tribunal's acceptance of that definition.

1. After reviewing the arguments respectively put to it on behalf of VETAB and Focal the Tribunal expressed its conclusions in these paragraphs:

50 The Tribunal stands in the shoes of VETAB. VETAB has power to cancel Focal's registration and approval on the ground that its "ethical standards" are such that registration and/or approval are not warranted if it were applying for registration or approval now: VET Act , 18(2)(e) and s 34(7)(c).

51 The evidence satisfies us that Ms Absolon did not comply with VETAB's legitimate requests to apply in proper form for additional sites and an increase in student capacity. Even when told in 2007 that her application was incomplete and, later, that an application form with supporting documentation needed to be provided for each additional site, Ms Absolon did not comply. Rather, she was suspicious of VETAB's motives and responded in a combative manner. As the sole director and chief executive officer of Focal, Ms Absolon's ethical standards are below that which VETAB and the general public is entitled to expect of her. However, that diminution in ethical standards does not warrant the cancellation decisions. That is the case for several reasons. Firstly, the degree of moral culpability is not as great as it would have been had Ms Absolon been dishonest. Secondly, while Ms Absolon was fully aware that she was only approved to provide courses to 350 overseas students, that was not an express condition of her registration. Finally, Ms Absolon's culpability diminished when VETAB took no action after receiving her April 2007 letter.

52 In all the circumstances, Ms Absolon's ethical standards do not warrant cancellation of Focal's registration or cancellation of Focal's approval to provide courses to overseas students. Nevertheless, Ms Absolon is on notice that if her unco-operative, disrespectful and, at times, combative attitude continues, adverse decisions may be warranted.

1. In the submission of VETAB, in reaching those conclusions the Tribunal erred in law. It is necessary that we consider that submission but before doing so we should note that the Tribunal in its reasons lifted the corporate veil in the sense that it attributed to Focal all the acts and omissions of Ms Absolon. Neither party raised an issue about this at the hearing before us and we are content to treat the matter on the same basis.

1. Likewise, unsurprisingly, there was no challenge by VETAB to the Tribunal's finding that " As the sole director and chief executive officer of Focal, Ms Absolon's ethical standards are below that which VETAB and the general public is entitled to expect of her". However it was submitted that this finding required as a matter of law and the proper exercise of discretion that the cancellation and refusal decisions be affirmed. Whether or not Ms Absolon's ethical standards were "below those which VETAB and the general public were entitled to expect" is an irrelevant consideration. There is only one standard or criterion mandated by Parliament, namely one that recognises that not every ethical transgression would necessarily lead to the cancellation of registration or withdrawal of approval and that the relevant decision maker would need to exercise judgment. The Tribunal addressed the correct question in paras 51, 52 and 53 of its reasons when it held in effect that Ms Absolon's tarnished ethical standards would not have warranted the cancellation decisions.

1. We note the preliminary words of s18(1) and s35(1) which seem to us to confer upon VETAB an unfettered discretion to do the various matters stipulated. The power is circumscribed in the case of s18 by ss(2) and in the case of s35 by ss(3) but as a matter of interpretation in our opinion proof of one or more of the circumstances set forth in the paragraphs enlivens but does not mandate an occasion for the exercise of the discretion. In some situations, of course, clause (c) for instance, failure to act may well indicate that the exercise of the discretion miscarried.

1. For the most part clauses (a) to (i) in the case of s18(2) and (a) to (l) in the case of s35(3) involve a simple factual finding. Paragraph (e) in both cases however involves a two step process. First a factual finding as to the relevant financial arrangements or ethical standards and second a determination as to whether they are such that they would not warrant registration or approval as the case may be upon an application made at that time. The second step requires a factual finding as to the extent of any departure from what the fact finder regards as proper financial arrangements or ethical standards and then the exercise of a discretion.

1. The Tribunal listed in para 51 of its reasons the factors it took into account in deciding that the unethical conduct it found would not warrant cancellation of registration or refusal of approval. None of those factors seems to us to be irrelevant nor was it submitted that any other consideration should have been but was not taken into account.

1. As to the circumstance that Ms Absolon had not been dishonest we agree with Mr Cribb that a requirement to act ethically is not limited to a requirement to act honestly. Nonetheless it seems to us relevant to consider honesty as a factor mitigating the gravity of the unethical conduct found proved.

1. We reject Mr Cribb's submission to the effect that it was irrelevant for the Tribunal to take into account the fact that an obligation to provide courses to no more than 350 students was not a condition of Focal's registration. In support of this submission Mr Cribb referred to Roberts v Hopwood [1923] AC 578. That case is certainly authority for the proposition that VETAB and the Tribunal in its place were required by law to act reasonably and not have regard to irrelevant considerations. We are not however persuaded that this was an irrelevant consideration. In the context of what was occurring at the time between VETAB and Focal it may not have carried much weight, but it was, as it seems to us, relevant to take into account that Focal was not in breach of conditions attached to its registration, particularly as VETAB had been entitled at any time to impose such conditions under s13(2) of the VET Act but chose not to.

1. Significant delays by VETAB were also in our opinion a relevant factor to be taken into account in assessing the gravity of Focal's departure from appropriate ethical standards. As the Tribunal found there certainly was fault on the part of Focal but there were also delays and perhaps bureaucratic inflexibility by VETAB. These were relevant factors in considering the moral culpability of Focal.

1. In our opinion the Tribunal's fact-finding process revealed no error of law. Nor in our opinion were its conclusions including its exercise of discretion so unreasonable as to fall within what was said in Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1KB 223. It would of course be quite wrong of us to interfere with the exercise of a discretion merely because we preferred some other decision. The words of Mason J in Minister for Aboriginal Affairs v Peko Wallsend Ltd (1986) 162 CLR 24 at para 28 of His Honour's judgment are apt:

The rules governing appellate review of a discretionary judgment are only partly founded on the opportunity of the judge who first exercises the discretion to assess the evidence at first hand. More fundamentally, they are grounded in the view that it would not be right to overturn a judicial decision solely on the basis of the appellate court's mere preference for a different result, when the question is one on which reasonable minds may come to different conclusions, the decision of the judge first exercising the discretion falls within a reasonable range, and no error on his part can be shown.

1. As we have indicated earlier, even proof of a breach of ethical standards of sufficient gravity to establish the second limb of paragraph (e) of the subsections does no more than enliven the power to exercise the discretion conferred by their opening words. In this case the Tribunal for what we regard as unassailable reasons found that the second limb was not established, and that, in our view, puts an end to the matter. There was no error of law in expressing that conclusion. We have not overlooked Mr Cribb's submission related to para 42 of the Tribunal's reasons, that in the paragraph the Tribunal "erred as a matter of law on the grounds that the Tribunal as constituted under the ADT Act ought not excuse a party from choosing a course of action which that party knew or ought to have known was contrary to the legislative regime which governed that party's conduct in circumstances where a legal remedy was available to that party." It is not immediately clear to us how a failure to commence proceedings in the nature of a claim for prerogative relief in the Supreme Court should count against Focal. Moreover it is not apparent exactly what relief it is suggested should have been sought.

1. In relation to the application for leave to appeal on the merits we observe that the hearing before the Tribunal occupied some five days. As to the relevant principles we respectfully adopt what was said by an Appeal Panel of this Tribunal in Commissioner of Police v Fortuna [2010] NSWADTAP51 at para 44:

44 It is not necessary for the Appeal Panel to first identify an error of law before granting leave for an appeal to be extended to the merits of the Tribunal's decision: Lloyd v Veterinary Surgeons Investigating Committee [2005] NSWCA 456. The onus of proof lies on the party applying for leave and the standard of proof is on the balance of probabilities: World Best Holdings Ltd v Sarker & Anor [2004] NSWSC 935 at [25] per Sully J. The discretion is open and unfettered but must be exercised in a fair and just manner having regard to the purpose of the relevant legislation: Jones v Ekermawi [2009] NSWSC 143 at [13]. Certain inferences can be drawn from the fact that leave is required. They include the fact that the need for leave is a 'control filter' designed, among other things, to protect respondents from the cost of a full hearing of appeals which should not properly be entertained: World Best Holdings Ltd v Sarker & Anor , per Sully J at [25]. Circumstances which may justify leave being granted include where the Tribunal has gone about its fact finding process in an unfair or unorthodox manner: K v K [2000] NSWSC 1052 at [10] to [15].

1. Although the Appeal Panel did not expressly say so, in the passage quoted it implied, and we agree, that an error of law would be a circumstance pointing to the exercise of the discretion in favour of allowing an appeal on the merits. There was no such error in this case nor in our opinion did the Tribunal go about its fact finding process in an unfair or unorthodox manner. Moreover as we have found the Tribunal's decision was within the bounds of reasonableness. That being so we are of the opinion that it would be unfair and unjust to allow VETAB the opportunity of persuading us that a different conclusion on the merits should be made by us and substituted for that made by the Tribunal who saw the witnesses over a 5 day hearing.

1. In addition to the orders made on 14 September 2010 we give Focal leave to make written submissions within 21 days in the event it seeks an order for costs. VETAB may make submissions in reply within a further 21 days. Thereafter the matter to be decided on the papers. If no such submissions are made by Focal, there will be no order as to costs.

I hereby certify that this is a true and accurate record of the reasons for decision of the Administrative Decisions Tribunal.

Registrar

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Decision last updated: 21 March 2011