PENZAR Pty Ltd v Commissioner for Consumer Protection
[2012] WASC 435
•16 NOVEMBER 2012
PENZAR PTY LTD -v- COMMISSIONER FOR CONSUMER PROTECTION [2012] WASC 435
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2012] WASC 435 | |
| Case No: | SJA:1035/2012 | 10 AUGUST 2012 | |
| Coram: | HALL J | 16/11/12 | |
| 16 | Judgment Part: | 1 of 1 | |
| Result: | Appeal allowed Conviction set aside Charge remitted to the Magistrates Court for a re-trial | ||
| B | |||
| PDF Version |
| Parties: | PENZAR PTY LTD COMMISSIONER FOR CONSUMER PROTECTION |
Catchwords: | Criminal law Appeal against conviction Offence under Residential Tenancies Act 1987 (WA) Ignorance of the law Whether intent to defeat, evade or prevent operation of the law requires knowledge of the wrongfulness of the act Whether magistrate properly considered elements of the offence |
Legislation: | Criminal Code (WA), s 22 Residential Tenancies Act 1987 (WA), s 82 |
Case References: | Commonwealth v Baume (1905) 2 CLR 405 Iannella v French [1968] HCA 14; (1968) 119 CLR 84 Ostrowski v Palmer [2004] HCA 30; (2004) 218 CLR 493 Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 Re Question of Law Reserved (No 2 of 1998) (1998) 70 SASR 502; (1998) 101 A Crim R 317 Shire of York v Rosmill Pty Ltd [2010] WASC 189 The Queen v Taib; Ex parte Director of Public Prosecutions (Cth) [1999] 2 Qd R 649; (1998) 105 A Crim R 10 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CRIMINAL
- Appellant
AND
COMMISSIONER FOR CONSUMER PROTECTION
Respondent
ON APPEAL FROM:
Jurisdiction : MAGISTRATES COURT OF WESTERN AUSTRALIA
Coram : MAGISTRATE B A LANE
File No : PE 41936 of 2011
Catchwords:
Criminal law - Appeal against conviction - Offence under Residential Tenancies Act 1987 (WA) - Ignorance of the law - Whether intent to defeat, evade or prevent operation of the law requires knowledge of the wrongfulness of the act - Whether magistrate properly considered elements of the offence
(Page 2)
Legislation:
Criminal Code (WA), s 22
Residential Tenancies Act 1987 (WA), s 82
Result:
Appeal allowed
Conviction set aside
Charge remitted to the Magistrates Court for a re-trial
Category: B
Representation:
Counsel:
Appellant : Mr P G Donovan
Respondent : Dr E M Heenan
Solicitors:
Appellant : MDS Legal
Respondent : Department of Commerce
Case(s) referred to in judgment(s):
Commonwealth v Baume (1905) 2 CLR 405
Iannella v French [1968] HCA 14; (1968) 119 CLR 84
Ostrowski v Palmer [2004] HCA 30; (2004) 218 CLR 493
Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355
Re Question of Law Reserved (No 2 of 1998) (1998) 70 SASR 502; (1998) 101 A Crim R 317
Shire of York v Rosmill Pty Ltd [2010] WASC 189
The Queen v Taib; Ex parte Director of Public Prosecutions (Cth) [1999] 2 Qd R 649; (1998) 105 A Crim R 10
(Page 3)
- HALL J:
Introduction
1 On 17 February 2012 the appellant was convicted following a trial in the Magistrates Court of one charge of entering into an agreement with intent, either directly or indirectly, to defeat, evade or prevent the operation of s 30 of the Residential Tenancies Act 1987 (WA) (RTA) contrary to s 82(2) of the Act. The appellant now seeks leave to appeal against that conviction.
2 The appellant filed an appeal notice on 15 March 2012. That appeal notice contained four grounds of appeal. In essence, the issue raised by the grounds is whether it is sufficient to prove an intent to defeat, evade or prevent the operation of s 30 of the Act that a person voluntarily entered into an agreement that would have that effect. The appellant submits that such a finding would not be sufficient. It submits that to establish the offence it must be proven that the person entered into the agreement intending that the effect of the agreement would be to defeat, evade or prevent the operation of s 30 of the Act.
3 At trial officers of the appellant gave evidence that they entered into the relevant agreement, being a residential tenancy agreement, believing, albeit wrongly, that the agreement was one that did not contravene the Act. The magistrate concluded that such a belief was a mistake of law and provided no excuse. In coming to this conclusion her Honour applied the general principle regarding ignorance of the law contained in s 22 of the Criminal Code (WA). However, there is an issue as to how s 22 can be reconciled with the words of s 82(2) of the RTA and to what extent s 22 dictates the interpretation of s 82 RTA.
Background
4 At the trial, which occurred on 12 December 2011, a statement of agreed facts was read to the court. The agreed facts were as follows. At all material times the appellant was a company registered in Western Australia that traded under the registered business name Gow Real Estate and held a real estate and business agents licence and tri-annual certificate. The person in bona fide control of the appellant at all relevant times was a licensed real estate agent, Ms Deidre Gow. Ms Gow is also a director of the appellant.
5 On or about 2 October 2009 Ms Stephanie Turner and Mr Lance Baker were looking to rent a property at 39/62 Moondyne Drive,
(Page 4)
- Wembley. On 22 October 2009 Ms Turner and Mr Baker attended the offices of the appellant and met with Mr Craig Tippett, an employee of the appellant and a registered sales representative. On that date, Ms Turner and Mr Baker entered into a six month fixed term residential tenancy agreement to rent the property at $290 per week. The agreement contained a special condition which read:
The tenants are aware that this is a replacement lease for the current tenant who is breaking their lease and the lease will increase to $350 per week from 5 February 2010.
7 Section 30 of the RTA provides as follows:
Variation of rent
(1) Subject to this section, the rent payable under a residential tenancy agreement may be increased by the owner by notice in writing to the tenant specifying the amount of the increased rent and the day as from which the increased rent becomes payable, being a day -
(a) not less than 60 days after the day on which the notice is given; and
(b) not less than 6 months after the day on which the tenancy commenced, or, if the rent has been increased under this section, the day on which it was last so increased,
but otherwise the rent shall not increase or be increased.
(2) The right of the owner to increase rent in accordance with subsection (1) -
(a) is not exercisable in relation to a residential tenancy agreement that creates a tenancy for a fixed term during the currency of that term unless the agreement provides that the rent may increase or be increased; and
(b) in any case, may be excluded or limited by agreement between the owner and the tenant.
(3) A notice of increase of rent that has been given in accordance with this section and that has not been withdrawn by the owner varies the residential tenancy agreement to the effect that the increased rent specified in the notice is payable under the agreement as from the day specified in the notice.
(Page 5)
8 One effect of s 30 is that the rent on a residential tenancy that is covered by the Act cannot be increased at a time less than six months after the tenancy commenced. This was a residential tenancy to which the Act applied: See s 5. No exemption had been sought under s 84. Accordingly, the prohibition in s 30 was applicable in this case.
9 The word 'tenancy' is defined in s 3 to mean the right of occupancy under a residential tenancy agreement. There is no provision defining when a tenancy commences. It is reasonable to conclude that a tenancy commences when the right to occupy the premises arises.
10 In this case, the tenants had a right of occupancy as from 22 October 2009. That is the date that they entered into the relevant residential tenancy agreement. Accordingly, rent payable under that agreement could only be increased in accordance with s 30. It could not be increased less than six months after 22 October 2009.
11 The special condition was contrary to s 30 in that it had the effect of raising the rent from a time that was less than six months after the tenancy commenced. The prosecution case was that by entering into a tenancy agreement that contained a condition contrary to s 30 of the RTA the appellant contravened s 82(2) of the Act. That subsection is contained in a section headed 'Contracting out'. Section 82 provides as follows:
(1) Except as provided in subsection (3) or by or under any other provision of this Act -
(a) any agreement or arrangement that is inconsistent with a provision of this Act or purports to exclude, modify or restrict the operation of this Act is to that extent void and of no effect; and
(b) any purported waiver of a right conferred by or under this Act is void and of no effect.
(2) Except as permitted by subsection (3) or by or under any other provision of this Act, no person shall enter into any agreement or arrangement with intent either directly or indirectly to defeat, evade or prevent the operation of this Act.
Penalty: $2 000.
(3) A residential tenancy agreement may contain a provision by which section 38, 39, 40, 41, 42, 43, 45, 46, 47, 48, 49, 50, 55 or 56 is excluded, modified or restricted if the residential tenancy agreement is in writing and is signed by the owner and the tenant.
(Page 6)
12 The effect of s 82(1) is that any condition in a residential tenancy agreement that is inconsistent with, inter alia, s 30 is void and of no effect. There are some circumstances, provided for in s 82(3), where a provision of the Act can be excluded or modified. However, that cannot be done in respect of s 30. The protection afforded to residential tenants by s 30 is not one that can be excluded by agreement or waived by the tenant.
13 Section 82(2) provides that it will be an offence if an agreement is entered into with intent to defeat, evade or prevent the operation of the Act. Thus where an agreement contains a condition that is contrary to s 30 that condition will have no effect and, in some circumstances, the entering into of that agreement will be an offence. An offence is committed by any person who entered into an agreement with the requisite intent. It is not confined to the landlord or their agent, though the landlord might be assumed to be more likely to want an early rent increase and have the requisite intent. This offence provision could accurately be described as an anti-avoidance provision. That is, it is designed to discourage deliberate attempts to avoid the requirements of the RTA.
14 The appellant's case was that at the time the lease was entered into Mr Tippett had a belief that the prohibition in s 30 did not apply to a 'break lease' situation. This situation was said to arise when an original lease had been wrongly terminated by a previous tenant and a second lease is then entered into with a new tenant that acts as a substitution for the first lease. Mr Tippett's belief was that in such circumstances the six months would run from the date that the original lease was entered into.
15 It was submitted at the hearing that this interpretation of s 30 was a widely held one in the industry, however it was accepted that it was mistaken. Nonetheless, it was said to be relevant that the breach had occurred through ignorance and not deliberately. In particular, it was relevant to whether the necessary element of intent to defeat, evade or prevent the operation of the Act was established.
Magistrates Court proceedings
16 The transcript of the Magistrates Court proceedings is incomplete. Fortunately that does not matter because there is no real dispute as to what the evidence was.
(Page 7)
17 In her reasons the magistrate referred to the issue of intent and said:
15. Intent can be inferred from the conduct of Mr Tippet. The actions of Mr Tippet were deliberate and intentional. He inserted paragraph 13 as a special condition because it was his belief that in a break lease situation rent could be increased within a six month period. Section 82(2) of the Act makes it an offence for a person to enter into any agreement or agreement with intent ... to defeat, evade or prevent the operation of the Act. Is it an element of the offence that the 'intent' in section 82(2) of the Act relates only to entering into the lease agreement? Or does it mean that the person must by entering into the agreement or arrangement intend to directly or indirectly defeat, evade or prevent the operation of the Act, so that the intention relates to the evasion, preventing or defeating of the operation of the Act. It is my opinion that this is what the section means. That the person entering into the agreement or arrangement must intend to directly or indirectly defeat, evade or prevent the operation of the Act. In this case section 30 of the Act.
16. Mr Tippet and Ms Gow both believed that their interpretation of break lease/rental increase was correct in law and could be done. It was a widely belief amongst agents that in a break lease situation rental increased were allowed to be calculated from the start date of the first tenancy and the new tenancy was a continuation in time from the commencement of the first tenancy.
17. This is a criminal prosecution and the prosecution are required to prove 'intent' as an element of the offence pursuant to section 82(2) of the Act.
18. Mr Tippet intended to insert paragraph 13 of the special conditions into the lease based on his belief that he was correct in his legal interpretation of section 30 of the Act.
18 Her Honour then went on to consider the application of provisions of the Criminal Code. In particular, her Honour referred to s 24 which deals with honest and reasonable but mistaken beliefs of fact. In that context her Honour referred to my decision in Shire of York v Rosmill Pty Ltd [2010] WASC 189 before stating:
25. The mistake made by Mr Tippet was that he could increase the rent in a period less than 6 months into a new lease which was entered into in a break lease situation. It is my view that this interpretation of section 30 is a mistake of law and not a mistake of fact.
19 Her Honour then referred to s 22 of the Criminal Code which provides that ignorance of the law does not afford an excuse for an act or omission which would otherwise constitute an offence unless knowledge
(Page 8)
- of the law by an offender is expressly declared to be an element of the offence. Her Honour then said:
28. Mr Tippet's legal interpretation of section 30 is not correct. The fact that other agents held the same incorrect legal opinion does not provide a defence to Mr Tippet. This is a matter of mitigation, not defence.
Her Honour then concluded as follows:
30. In this case Mr Tippet and Ms Gow both held a belief that their interpretation of the law relating to section 30 was correct. The Residential Tenancy Court found that it was not a correct interpretation of the law and that special condition 13 was void. (Section 82(1)(A) of the Act).
31. Mr Tippet intended to insert the special condition, paragraph 13 into the lease agreement. He intended to exclude the provisions of section 30 of the Residential Tenancy Act, because he believed that his interpretation of section 30 was legally correct. It was not and the court has held that it was not with respect to the lease agreement the subject of this charge.
Findings
32. The prosecution have proven beyond a reasonable doubt that:
a) Penzar Pty Ltd is a person;
b) that they entered in a residential tenancy agreement on behalf of an owner they represented; and
c) with intent to directly or indirectly defeat, evade or prevent the operation of the Act. (Section 30 of the Act).
33. I find the Prosecution have proved beyond a reasonable doubt the charge and I enter a conviction.
20 The grounds of appeal are as follows:
1. The learned Magistrate erred both in law and in fact in finding that the prosecution had proved beyond reasonable doubt that the appellant intended to directly or indirectly defeat, evade or prevent the operation of section 30 of the Residential Tenancies Act (Act), in circumstances where the learned Magistrate made other findings which were inconsistent with such an intent.
(Page 9)
- The learned Magistrate found that:
(i) Mr Tippett (who was found to have entered the agreement as employee of the appellant) and Mrs Gow (a director and person in bona fide control of the appellant) believed, in effect, that such an agreement was correct in law;
(ii) Mr Tippett prepared the agreement based on his belief to that effect.
2. The learned Magistrate erred in law in finding, in effect, that as Mr Tippett's belief that the agreement he prepared and entered as employee was correct in law was a belief that was mistaken, that belief could not be relied upon in determining whether the appellant had the requisite intent because Mr Tippett's mistake was one of law.
3. The learned Magistrate erred in law in failing to disclose any findings of fact or, alternatively, any sufficient findings of fact, to support his conclusions that Mr Tippett intended to exclude the provisions of section 30 of the Act and the requisite intent by the appellant to defeat, evade or prevent the operation of the Act had been proved.
4. The learned Magistrate's finding that the appellant had the requisite intent to defeat, evade or prevent the operation of the Act was against the weight of evidence.
Particulars
- 4.1 The unchallenged evidence of Craig Tippett at the trial was to the effect that he had acted in the belief that he was complying with section 30 of the Act and did not intend to defeat, evade or prevent the operation of the Act.
Merits of the appeal
21 Sometimes it is suggested that every person is presumed to know the law, but that is not the effect of s 22 of the Criminal Code and any such presumption would be absurd. Rather, what s 22 provides is that ignorance of the law affords no excuse. The effect may be the same but the different focus illustrates the underlying purpose of the provision. It prevents any requirement that the prosecution prove awareness of the law and prevents offenders from escaping responsibility for criminal acts due to claimed ignorance of the law or an idiosyncratic view of it: Ostrowski v Palmer [2004] HCA 30; (2004) 218 CLR 493.
(Page 10)
22 There is no doubt that s 22 has broad application. Section 36 of the Criminal Code provides that the provisions of ch 5, in which s 22 appears, apply to all persons charged with any offence against the statute law of Western Australia. Thus it clearly applies to offences under s 82(2) of the RTA.
23 Section 22 also provides for the possibility that the legislature may make knowledge of the law an element of an offence in some circumstances. However, so as not to detract from the general principle, s 22 requires that if knowledge of the law is to be an element of the offence it must be 'expressly declared' to be an element. Presumably that means declared in the statute creating the offence.
24 In the present case the respondent submits that s 82(2) of the RTA should be interpreted consistently with s 22 of the Criminal Code. It is submitted that the statement of the offence in s 82(2) does not contain any words that expressly declare that knowledge of the law is an element of the offence and, accordingly, it cannot be an element. Whether this argument is sound depends upon the interpretation of s 82. The starting point for determining the elements of the offence under s 82(2) is the words of that subsection.
25 Section 82(2) is aimed at agreements or arrangements that are intended to defeat, evade or prevent the operation of the Act. These are words that suggest that the intention must encompass not only the outcome but the nature of the outcome. To act in a way that defeats, evades or prevents operation of the Act implies knowledge of that effect and not mere carelessness or ignorance. See Re Question of Law Reserved (No 2 of 1998)(1998) 70 SASR 502; (1998) 101 A Crim R 317, 508 (Doyle CJ).
26 In Question of Law Reserved (No 2 of 1998) the issue was whether it was necessary to prove that a person charged with a structuring offence under s 31 of the Financial Transaction Reports Act 1988 (Cth) (FTRA) had to know of the necessary reporting requirements under that Act. Doyle CJ held that s 31 was intended to prevent evasion of reporting obligations and that purpose suggested that the section was aimed at persons who are aware of the potential significance of the manner in which a transaction is conducted.
27 A different conclusion was reached by the Queensland Court of Appeal in respect of a different offence provision under the FTRA in The Queen v Taib; Ex parte Director of Public Prosecutions (Cth) [1999]
(Page 11)
- 2 Qd R 649; (1998) 105 A Crim R 10. The different outcome is accounted for by the significantly different wording of the offences that were under consideration. In Taib the offence was not one of structuring; that is, entering into a number of transactions for the purpose of avoiding a reporting requirement, rather the offence was simply one of failing to make a report in respect of the transfer of $5,000 or more.
28 Whilst both of those cases were in respect of legislation which is different from that presently under consideration and neither of them raised the issue of a provision like s 22 of the Criminal Code, they do indicate the significance of paying close attention to the words of the offence-creating provision. The words of the legislation may make it clear that for an offence to be committed a particular state of mind must be established.
29 A more closely similar case is that of Iannella v French [1968] HCA 14; (1968) 119 CLR 84. In that case the appellant was charged with an offence of wilfully demanding or wilfully recovering an irrecoverable sum as rent from the tenant of residential premises. The amount was not recoverable as the property was the subject of a Rent Control Act. The appellant and the tenant had entered into a rental agreement for the payment of rent in excess of that allowed for under the Act. At the time this occurred the appellant was under the mistaken belief that rental controls had been lifted. There had been some publicity to this effect and some controls had been lifted, but not in respect of the relevant property. The appeal was allowed on the basis that the charge was duplicitous in that it alleged that the appellant had both wilfully demanded and wilfully recovered an irrecoverable sum. However, consideration was also given to the issue of the relevant state of mind required to commit the offence. Barwick CJ said:
The criminal offence in this case is created, it seems to me, on the one hand in the expectation that it will deter landlords who might be tempted otherwise to risk the recovery by the tenant of the overcharged rent and, on the other hand, to express the community's disapproval of a defiant or contumacious act on the part of the landlord. In either case, the requirement of mens rea would be appropriate and to dispense with it, in my opinion, quite inappropriate. Then the demand is to be of an irrecoverable rent. It seems to me that the intention with which the demand must be made must be not merely an intention to obtain by the demand a sum of money: the intention, in my opinion, must be to achieve the full consequence of the demand, to obtain as it were, its forbidden fruit. This would indicate, in my opinion, the need for the existence of either an actual or an imputed consciousness of the wrongdoing involved in the demand. By including an imputed consciousness in that connexion, I
(Page 12)
- mean to leave room for the concept of recklessness, or culpable indifference as an equivalent of knowledge or consciousness of the quality of the act performed. In short, apart from the influence of the word 'wilful', there is much to be said for the view that the terms of this section require that the defendant should know that his demand is wrongful. A finding that he had an honest belief that his act was proper and lawful denies that knowledge (94).
30 A little later his Honour said:
In my opinion, 'wilful' connotes intention and knowledge: the problem is to determine in the particular circumstances what is to be intended and what known. The answer, as I have said, must vary with the nature of the act proscribed and the context of the statutory provision creating the offence. Further, the word intention itself obscures a difficulty. Thus it is said on some occasions to be satisfied by mere volition to do the specific act in question. But in truth, in my opinion, the word contains in its connotation elements of purpose. It is not merely that the mind goes with the act but that the mind intends by the act to achieve something. Of course, in some statutory circumstances, the mere doing without consequence or without purpose is forbidden, in which event the conscious doing of the act may suffice to make its performance intentional and in these circumstances wilful (95).
31 There was a divergence of views in Iannella as to whether the appellant's mistaken view as to removal of rent controls was exculpatory. Barwick CJ was in the minority in this regard, but that does not indicate that the statements of broad principle quoted are not correct. In any event, the differences arose in respect of an offence provision that included the word 'wilfully' but did not, as here, refer to the purpose of the prohibited act as being to defeat, evade or prevent the operation of the Act. It was possible in Iannella for the majority to interpret the words used as only meaning that the demand or recovery of rent had to be wilful. A similar interpretation is not open here for the reasons that follow.
32 In this case the issue is not whether intent must be proved; of that there can be no doubt. An intention to cause a particular result is immaterial unless it is expressly declared to be an element of an offence: s 23 Criminal Code. In this case a specific intent is specified as an element of the offence. The issue is what that intent must encompass.
33 In some cases there can be difficulty in determining whether the intention relates only to the physical act or omission or also to the consequences and nature of that act or omission. In this case there is less difficulty because the words of s 82(2) make it clear that the intention is not one to simply enter into an agreement but to enter into one that has a
(Page 13)
- specified character. If that character is not known and if there is no expectation that a prohibited object will be achieved, it is difficult to see how the intention could be said to exist.
34 If all that s 82 required was an intention to enter into an agreement that, as a matter of fact, defeated, evaded or prevented operation of the Act but required no knowledge or purpose in that regard then it would be expected that the offence would be framed differently. It would be clear that the intention did not relate to the character of the outcome if the offence was framed as being to enter into an agreement that would defeat or prevent the operation of the Act. However, the use of the word 'intent' when coupled with the other words makes it clear, in my view, that the intention was intended to encompass these outcomes.
35 Furthermore, the words 'defeat', 'prevent' and 'evade' better describe an outcome that is the product of moral culpability rather than being an objective description of that outcome. Whilst it is possible to understand how an agreement can, objectively, be said to have the effect of defeating or preventing the operation of an Act it is much more difficult to see how the word 'evade' could be used in this context. The use of that word connotes a human purpose.
36 The respondent's approach to s 82(2) would produce the result that any person who committed the voluntary act of entering into an agreement that had the effect described would be guilty of an offence. In my view, this interpretation would deprive the words following 'with intent' of any real meaning. It is necessary in construing an enactment to favour an interpretation that allows all of the words used to have an operative effect: Commonwealth v Baume (1905) 2 CLR 405, 414 (Griffiths CJ); Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355, 382 (McHugh, Gummow & Kirby JJ).
37 In my view, as noted earlier, the nature of the offence in s 82(2) is that it is an anti-avoidance provision. It is intended to deter deliberate acts taken in defiance of the RTA. Clearly, it was thought that where a person acted in contempt of the RTA that was conduct of so serious a nature as to be deserving of criminal sanction. As Barwick CJ said in relation to the offence under consideration in Iannella, the words used require that the accused should know that his or her act is wrongful.
38 In drawing a conclusion as to the purpose of s 82(2) I have relied entirely on the words of that section and the context of the RTA in which it is contained. The parties did not rely on any extrinsic material and do
(Page 14)
- not suggest that any such material would assist. The respondent did, however, refer to provisions of the Real Estate and Business Agents Act 1978 (WA) (REBA) and to a code of conduct promulgated under that Act which requires, amongst other things, persons licensed under the Act to take reasonable steps to ensure compliance with relevant statutes, rules and regulations. Further there was reference to requirements on licensed agents to undertake continuing professional development. It was suggested that these provisions are inconsistent with an interpretation of s 82(2) which would have the effect of allowing a person to escape criminal responsibility on the basis that he or she was ignorant of the provisions of the RTA.
39 I am unable to accept those submissions for the following reasons. First, the fact that licensed agents may have professional obligations to be familiar with the law does not require an interpretation of s 82(2) of the RTA that would be contrary to the clear words of that section. Secondly, the issue is not whether ignorance of the law provides an excuse but whether a specific intent contained in s 82(2) has been proved. Thirdly, there is no inconsistency between the provisions of the REBA and s 82(2) of the RTA - indeed a licensed agent may comply with the REBA by being aware of the RTA requirements but act in deliberate defiance of them. Fourthly, s 82(2) applies to any person not merely licensed agents under the REBA; it cannot be assumed that the only people who will be potentially liable for a s 82(2) offence are licensed agents.
40 Accordingly, the elements of the offence in this case were that the appellant:
1. entered into an agreement; and
2. that it did so with intent to defeat, evade or prevent the operation of the Act.
41 In order to prove the offence the prosecution had to establish beyond reasonable doubt that the appellant had the intent referred to.
42 Does this mean that the prosecution had to prove that the appellant had knowledge of the wording and meaning of the RTA? No, but it does mean that in order to prove the offence the prosecution must establish that the appellant was aware that there was a prohibition on incorporating a condition allowing for a rent increase within the first six months of a residential tenancy, that it applied in the circumstances of the particular residential tenancy in question and that the appellant acted deliberately in breach of that prohibition. Whether or not the appellant knew the source
(Page 15)
- of that prohibition; that is, s 30 of the RTA, is irrelevant. Thus it is not necessary to prove knowledge of the law in the sense of an awareness of a particular provision of the Act, the words used in that provision or their meaning. However, it is necessary to prove that the appellant was aware of a legal duty to act in a certain way and that the act of entering into the agreement was contrary to the duty.
43 The magistrate, when dealing with the issue of intent, initially correctly stated what the prosecution was required to prove. She then appears to have been deflected from a consideration as to whether the evidence established the necessary intent in this case. In turning to consider 'mistake of fact' under s 24 her Honour moved to a question that was not raised by the appellant on the trial. The appellant was not seeking to argue that it had made a mistake of fact and, indeed, no such argument could sensibly have been raised on the evidence. What the appellant argued was that it did not act with the required intent because its officers misunderstood the duty regarding rental increases. Whilst her Honour's conclusion that Mr Tippett's error was not one of fact was no doubt correct, that was not the relevant issue in this case.
44 When her Honour turned to s 22 it seems that she simply concluded that by reason of that section nothing raised by the appellant afforded an excuse for entering into an agreement that included the special condition. However, her Honour did not reconcile the general principle in s 22 with the particular words of s 82(2), which she had earlier identified as requiring proof of a specific intent. It is important here to note that the relevant words of s 22 are that:
'Ignorance of the law does not afford any excuse for an act or omission which would otherwise constitute an offence, unless knowledge of the law by an offender is expressly declared to be an element of the offence (emphasis added).
- The highlighted words draw attention to the fact that s 22 operates in respect of acts or omissions that, putting aside any question of knowledge of the law, would constitute an offence. Pursuant to s 82(2) the act of entering into residential tenancy agreements that contained a provision contrary to s 30 would not constitute an offence unless the intention to thereby defeat, evade or prevent the operation of the Act was proven. Thus s 22 did not detract from the necessity to prove the elements of the offence; in fact it required it. The magistrate's reasoning caused her to fail to properly consider whether the element of intent was proven.
(Page 16)
Conclusion
45 For those reasons the appeal must be allowed and the conviction set aside.
46 On the hearing of this appeal the appellant submitted that this court should enter an acquittal if the appeal was allowed. The reasons for that were said to be that the magistrate had accepted the evidence of the appellant's witnesses, Mr Tippett and Ms Gow, as to their belief that the special condition did not breach s 30. In these circumstances it was submitted that no other conclusion was available on the evidence than that the intent in s 82(2) had not been established.
47 The difficulties with this submission are as follows. First, it was unnecessary for her Honour to give close consideration to the credibility of the evidence of the two defence witnesses given her view that the issue was that ignorance of the law afforded no excuse. She certainly gave no close consideration to the details of that evidence. Whether she might have reached a different view of that evidence if it was material to the outcome cannot be known. Secondly, the transcript of the relevant evidence is not available. It would seem that there was a fault in the recording equipment at the time. Accordingly, it is impossible for me to make any independent assessment of that evidence. In these circumstances, it will be necessary to remit the matter for a retrial before a different magistrate.
Orders
1. Leave to appeal on grounds 1 to 4 is granted.
2. The appeal is allowed.
3. The conviction on charge number PE 41936/11 is set aside.
4. The matter is remitted to the Magistrates Court to be retried according to law before a different magistrate.
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