Real Estate And Business Agents Supervisory Board and Mavaddat

[2008] WASAT 193

REAL ESTATE AND BUSINESS AGENTS SUPERVISORY BOARD and MAVADDAT [2008] WASAT 193

Link to Appeal :

[2009] WASCA 179

Jurisdiction:	STATE ADMINISTRATIVE TRIBUNAL	Citation No:	[2008] WASAT 193
Act:	REAL ESTATE AND BUSINESS AGENTS ACT 1978 (WA)
Case No:	VR:281/2005	Heard:	5 - 6 AUGUST 2008
Coram:	JUDGE J CHANEY (DEPUTY PRESIDENT) MR R AFFLECK (SENIOR SESSIONAL MEMBER) MR A MACNAGHTEN (SESSIONAL MEMBER)	Delivered:	27/08/08
No of pages:	26	Judgment Part:	1 of 1
Result:	Respondent permanently disqualified from holding a licence
Category:	B
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Parties:	REAL ESTATE AND BUSINESS AGENTS SUPERVISORY BOARD MICHAEL MOOJAN MAVADDAT
Catchwords:	Professional disciplinary proceedings ­ Real estate agent ­ Admission of allegations of breaches of Real Estate and Business Agents Act 1978 (WA) ­ Admissions as to making of false statements in various documents and unauthorised use of funds in company ­ Findings in Supreme Court proceedings of breaches of fiduciary duty, unconscionable conduct and lies and equivocation in testimony before Supreme Court ­ Acknowledgement that proper cause for disciplinary action exists ­ Appropriate penalty
Legislation:	Real Estate and Business Agents Act 1978 (WA), s 60(1), s 60(3), s 61(3),s 61(5), s 103(1)
Case References:	Ex parte Tziniolis; Re Medical Practitioners Act (1967) 67 SR (NSW) 448 Grljusich v Andrews [2003] WASCA 206 Jemielita v Medical Board of Western Australia (unreported, WASC, Library No 920584, 13 November 1992) Motor Vehicle Industry Board and Dawson [2006] WASAT 8 New South Wales Bar Association v Evatt (1968) 117 CLR 177 NSW Bar Association v Evatt (1968) 117 CLR 177 Paridis v Settlement Agents Supervisory Board [2007] WASCA 1997 Sobey v Commercial and Private Agents Board (1979) 22 SASR 70 The Registrar, Real Estate and Business Agents Supervisory Board v Barnett (unreported, FCt, WASC, Library No 970426, 26 August 1997)
Orders	1. By reason of the matters identified in par 3, par 4 and par 5 of the Agreed Allegations dated 27 May 2008, the real estate agent's licence held by Michael Moojan Mavaddat and any triennial certificate in respect thereof is cancelled, and Mr Mavaddat is disqualified permanently from holding a licence or triennial certificate.,2. By reason of the matters referred to in par 1 of the Agreed Allegations dated 27 May 2008, the respondent is to pay to the applicant a fine in the sum of $1,000, such fine to be paid within 30 days of the date of this order or such further time as the Board may permit.,3. The respondent is to pay the applicant's costs of the proceedings in an amount to be agreed, or failing agreement to be determined by the Tribunal.
Summary	The Real Estate and Business Agents Supervisory Board brought proceedings against Mr Michael Mavaddat, a licensed real estate agent. The Board alleged various breaches of the Real Estate and Business Agents Act 1978 (WA), and that cause for disciplinary action existed by reason of various false or dishonest statements made in various documents. It also alleged misuse of funds belonging to a company which Mr Mavaddat had formed with a business associate, Mrs Lee. In addition, the Board asserted that cause for disciplinary conduct existed by reason of certain findings made in a Supreme Court action brought by Mrs Lee against Mr Mavaddat. Those findings were that Mr Mavaddat had breached fiduciary duties owed to Mrs Lee, that he engaged in unconscionable conduct towards her, and that he lied and equivocated in his testimony in the Supreme Court action and demonstrated himself to be deceitful. ,The breaches of the Act, and the false statements contained in documents all arose in connection with Mr Mavaddat's dealings with Mrs Lee. A number of the false statements in documents were made in connection with attempts to obtain credit.,Mr Mavaddat initially resisted the allegations against him, but after the first day of the hearing before the Tribunal, the matter was resolved by agreement between the parties. The agreement was that Mr Mavaddat admitted, or did not challenge, most of the allegations against him. Two of the allegations against him were not pursued by the Board. In light of that resolution of the matter, it fell to the Tribunal to determine the appropriate penalty to be imposed upon Mr Mavaddat. ,The Board asserted that the admitted dishonest conduct, the misuse of company funds for his own purposes, and the findings by the Supreme Court judge, were such as to render Mr Mavaddat unfit to hold a licence as a real estate agent. The Board sought his permanent disqualification. ,The events the subject of complaint took place between 1999 and 2001, with the findings being made against Mr Mavaddat by the Supreme Court in 2004. Apart from the matters the subject of complaint, there had been no complaint or disciplinary issues in Mr Mavaddat's lengthy career as a real estate agent. Mr Mavaddat contended that his conduct was entirely caused by the stress of his relationship with Mrs Lee, and was out of character. He called a number of character witnesses who testified to their opinion that the events the subject of findings by the Supreme Court were totally out of character with Mr Mavaddat as they knew him.,The Tribunal considered the background to the matter, the proper approach to be taken to professional disciplinary penalties, the evidence adduced through character witnesses, and the opinion of a psychiatrist called on Mr Mavaddat's behalf. It concluded that the nature of the conduct admitted by Mr Mavaddat was such as to render him unfit to be licensed as a real estate agent. The Tribunal did not accept that Mr Mavaddat's explanation for his conduct, made through Mr Mavaddat's counsel, and by Mr Mavaddat to others, could be relied upon. It noted that the evidence before the Tribunal suggested that Mr Mavaddat had no appreciation of the seriousness of his conduct and did not accept responsibility for it. The Tribunal concluded that the public interest required that Mr Mavaddat be permanently disqualified from holding a real estate agent's licence.

JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL STREAM : VOCATIONAL REGULATION ACT : REAL ESTATE AND BUSINESS AGENTS ACT 1978 (WA) CITATION : REAL ESTATE AND BUSINESS AGENTS SUPERVISORY BOARD and MAVADDAT [2008] WASAT 193 MEMBER : JUDGE J CHANEY (DEPUTY PRESIDENT)

MR R AFFLECK (SENIOR SESSIONAL MEMBER)
MR A MACNAGHTEN (SESSIONAL MEMBER)

HEARD : 5 - 6 AUGUST 2008 DELIVERED : 27 AUGUST 2008 FILE NO/S : VR 281 of 2005 BETWEEN : REAL ESTATE AND BUSINESS AGENTS SUPERVISORY BOARD

Applicant

AND

MICHAEL MOOJAN MAVADDAT
Respondent

Catchwords:

Professional disciplinary proceedings ­ Real estate agent ­ Admission of allegations of breaches of Real Estate and Business Agents Act 1978 (WA) ­ Admissions as to making of false statements in various documents and unauthorised use of funds in company ­ Findings in Supreme Court proceedings of breaches of fiduciary duty, unconscionable conduct and lies and equivocation in testimony before Supreme Court ­ Acknowledgement that proper cause for disciplinary action exists ­ Appropriate penalty

(Page 2)

Legislation:
Real Estate and Business Agents Act 1978 (WA), s 60(1), s 60(3), s 61(3),s 61(5), s 103(1)

Result:

Respondent permanently disqualified from holding a licence

Category: B

Representation:

Counsel:

Applicant : Mr P O'Neal and Ms Y Fang
Respondent : Mr R Birmingham QC and Mr S Penglis

Solicitors:

Applicant : Tottle Partners
Respondent : Freehills

Case(s) referred to in decision(s):

Ex parte Tziniolis; Re Medical Practitioners Act (1967) 67 SR (NSW) 448
Grljusich v Andrews [2003] WASCA 206
Jemielita v Medical Board of Western Australia (unreported, WASC, Library No 920584, 13 November 1992)
Motor Vehicle Industry Board and Dawson [2006] WASAT 8
New South Wales Bar Association v Evatt (1968) 117 CLR 177
NSW Bar Association v Evatt (1968) 117 CLR 177
Paridis v Settlement Agents Supervisory Board [2007] WASCA 1997
Sobey v Commercial and Private Agents Board (1979) 22 SASR 70
The Registrar, Real Estate and Business Agents Supervisory Board v Barnett (unreported, FCt, WASC, Library No 970426, 26 August 1997)


(Page 3)

REASONS FOR DECISION OF THE TRIBUNAL:

Summary of Tribunal's decision

1 The Real Estate and Business Agents Supervisory Board brought proceedings against Mr Michael Mavaddat, a licensed real estate agent. The Board alleged various breaches of the Real Estate and Business Agents Act 1978 (WA), and that cause for disciplinary action existed by reason of various false or dishonest statements made in various documents. It also alleged misuse of funds belonging to a company which Mr Mavaddat had formed with a business associate, Mrs Lee. In addition, the Board asserted that cause for disciplinary conduct existed by reason of certain findings made in a Supreme Court action brought by Mrs Lee against Mr Mavaddat. Those findings were that Mr Mavaddat had breached fiduciary duties owed to Mrs Lee, that he engaged in unconscionable conduct towards her, and that he lied and equivocated in his testimony in the Supreme Court action and demonstrated himself to be deceitful.

2 The breaches of the Act, and the false statements contained in documents all arose in connection with Mr Mavaddat's dealings with Mrs Lee. A number of the false statements in documents were made in connection with attempts to obtain credit.

3 Mr Mavaddat initially resisted the allegations against him, but after the first day of the hearing before the Tribunal, the matter was resolved by agreement between the parties. The agreement was that Mr Mavaddat admitted, or did not challenge, most of the allegations against him. Two of the allegations against him were not pursued by the Board. In light of that resolution of the matter, it fell to the Tribunal to determine the appropriate penalty to be imposed upon Mr Mavaddat.

4 The Board asserted that the admitted dishonest conduct, the misuse of company funds for his own purposes, and the findings by the Supreme Court judge, were such as to render Mr Mavaddat unfit to hold a licence as a real estate agent. The Board sought his permanent disqualification.

5 The events the subject of complaint took place between 1999 and 2001, with the findings being made against Mr Mavaddat by the Supreme Court in 2004. Apart from the matters the subject of complaint, there had been no complaint or disciplinary issues in Mr Mavaddat's lengthy career as a real estate agent. Mr Mavaddat contended that his conduct was entirely caused by the stress of his relationship with Mrs Lee, and was out of character. He called a

(Page 4)

number of character witnesses who testified to their opinion that the events the subject of findings by the Supreme Court were totally out of character with Mr Mavaddat as they knew him.

6 The Tribunal considered the background to the matter, the proper approach to be taken to professional disciplinary penalties, the evidence adduced through character witnesses, and the opinion of a psychiatrist called on Mr Mavaddat's behalf. It concluded that the nature of the conduct admitted by Mr Mavaddat was such as to render him unfit to be licensed as a real estate agent. The Tribunal did not accept that Mr Mavaddat's explanation for his conduct, made through Mr Mavaddat's counsel, and by Mr Mavaddat to others, could be relied upon. It noted that the evidence before the Tribunal suggested that Mr Mavaddat had no appreciation of the seriousness of his conduct and did not accept responsibility for it. The Tribunal concluded that the public interest required that Mr Mavaddat be permanently disqualified from holding a real estate agent's licence.

Cause for disciplinary action

7 On 27 May 2008, the Tribunal found that proper cause for disciplinary action existed against Michael Moojan Mavaddat, a licensed real estate agent, by reason of matters referred to in a document entitled "Agreed Allegations" submitted to the Tribunal by the parties to these proceedings jointly. The agreement between the parties had been reached on the morning of the second day of what was to be a lengthy contested hearing. The agreement amounted to an admission by Mr Mavaddat of most of the allegations made against him by the Real Estate and Business Agents Supervisory Board (the Board). The Board did not pursue an allegation of deception in relation to the provision of security for a borrowing, and two of the three allegations particularised concerning unauthorised funds of a company known as Ark Securities Pty Ltd.

8 The terms of the Agreed Allegations are as follows:

1. The applicant alleges and the respondent admits that contrary to sections 60(1) and 60(3) of the Act the respondent received the sum of $133,000 as commission on the sale of the premises situated and known as 237-241 Hay Street, Subiaco, being the whole of the land comprised in certificate of title volume 1834 folio 644 (“Subiaco Property”), when the respondent did not have a written valid appointment to act for the vendor of the Subiaco Property, Absica Pty Ltd (“Absica”) under section 60(2) of the Real Estate and Business Agents Act 1978 (“Act”).

(Page 5)

PARTICULARS

The applicant relies on and the respondent admits:

1.1 the facts set out below:


(a) The respondent is and was at all material times:

(i) the holder of a real estate and business agent’s licence number 3420 first issued on 26 January 1990, expiring on 25 January 2011; and
(ii) trading as Key West Realty (“KWR”).

(b) At all material times the respondent was the sole director and shareholder of Keywest International Group Pty Ltd (“Keywest International”).

(c) At all material times, Kyung Hee (Angela) Lee (“Mrs Lee”) and Yuen Ling (Johnson) Lee (“Mr Lee”) were the directors and shareholders of Courtza Pty Ltd (“Courtza”).

(d) On 2 September 1997, Absica became the registered proprietor of the Subiaco Property.

(e) By a contract for sale of land by offer and acceptance executed by Keywest International and Courtza, as purchasers, on 28 and 30 August 1999, respectively, and by Absica, as vendor, on 31 August 1999 (“Subiaco Contract”), Keywest International and Courtza agreed to purchase the Subiaco Property, as tenants in common in equal shares, from Absica for a purchase price of $843,000, with a deposit of $133,000 to be paid forthwith.

(f) By a document headed “Disclosure As A Principal” dated 30 August 1999 executed by Courtza and Absica (“Disclosure Document”) the respondent gave notice that he was a director of Keywest International and a licensed real estate agent, and that KWR was entitled to charge, and Absica was required to pay to KWR, a commission of $133,000 upon satisfactory settlement of the sale and purchase of the Subiaco Property pursuant to the Subiaco Contract.

(g) The deposit of $133,000 to be paid forthwith under the Subiaco Contract represented, and was

(Page 6)

accepted by Absica and KWR as, the commission due by Absica to KWR for the sale of the Subiaco Property referred to in the Disclosure Document.

(h) At all material times, KWR acted or purported to act as Absica’s agent in relation to the sale of the Subiaco Property.

(i) At no time prior to, nor at any time after, the execution of the Subiaco Contract did KWR have a valid written appointment signed by Absica for KWR to act for, or on behalf of, Absica in the sale of the Subiaco Property within the meaning of section 60(2) of the Act.

1.2 paragraph 437 of the judgment of Roberts-Smith J delivered on 29 April 2005 in Lee v Mavaddat [2005] WASC 68 (“Judgment”) in Supreme Court actions CIV 1862 of 2001 and CIV 1824 of 2001 between Mrs Lee as plaintiff and the respondent as defendant (“Action”), and the matters referred to therein.

2. The applicant alleges and the respondent admits, for the purpose of these proceedings only, that contrary to sections 61(3c) and 61(5) of the Act the respondent demanded and received the sum of $133,000 as commission, reward or other valuation [sic] consideration for his services in relation to the sale of the Subiaco Property which was unjust in all the circumstances.

PARTICULARS

The applicant relies on and the respondent does not challenge for the purpose of these proceedings:

2.1 the facts set out in paragraphs 1.1(a) to (i) above and the following facts:

(a) pursuant to a selling agency agreement dated 2 August 1999, Absica appointed Stanton Hillier Parker (WA) Pty Ltd as its agent to sell the Property for $690,000 and agreed to pay Stanton Hillier Parker (WA) Pty Ltd a commission of $15,000, being 2.17% of $690,000;

(b) the amount of $133,000 demanded and received by the respondent represents 15.78% of the purchase price of $843,000 paid by Ark Securities Pty Ltd (“Ark”) for the Subiaco Property; and


2.2 paragraphs 433 to 443 and 445 to 449 of the Judgment, and the matters referred to therein.

(Page 7)

3. The applicant alleges and the respondent does not challenge for the purpose of these proceedings that:

3.1 the respondent’s conduct and actions, as found by Roberts-Smith J in the Action, which stand unaffected by the appeal in Mavaddat v Lee [2007] WASCA 141, as set out below:

(a) The respondent, in business correspondence and in seeking financial accommodation, held himself out as having a BSc degree from the United States of America when he had never held such a degree.


PARTICULARS
The applicant relies on and the respondent admits paragraph 342 of the Judgment.

(b) The respondent, in financial dealings with Mr Lee, lied in various statements he made to Mr Lee in his facsimile to Mr Lee dated 6 December 1999.

PARTICULARS
The applicant relies on and the respondent does not challenge for the purpose of these proceedings paragraphs 156 and 343 to 352 of the Judgment and the matters referred to therein.

4. The applicant alleges and the respondent does not challenge for the purpose of these proceedings that:

(a) the respondent, through his accountant, Lombardo, submitted a letter to St George Bank Limited (“St George”) on 28 October 1999 containing the following false statements, for the purpose of obtaining financial accommodation with the bank:

(i) that the respondent had received income of $236,078 for the financial year ending 1999, including two amounts totalling $150,000, described as “Kung Hee consultation” and “Lee consultation”, when the respondent knew that the $150,000 referred to therein was money loaned by Mrs Lee to Keywest International.

PARTICULARS
The applicant relies on and the respondent does not challenge for the purpose of these proceedings paragraphs 354, 355 and 356 of the Judgment, and the matters referred to therein.

(Page 8)

(ii) that the respondent had received income of $17,250 for the financial year ending 1998, described as “Marble Bar consultation”, when the respondent knew that that was a loan from Umberto Tinelli to the respondent.

PARTICULARS

The applicant relies on and the respondent does not challenge for the purpose of these proceedings paragraph 357 of the Judgment and the matters referred to therein.

(iii) that there was some $240,000 in unconditional settlements due in the next three months when there was no unconditional contract.

PARTICULARS

The applicant relies on and the respondent does not challenge for the purpose of these proceedings paragraph 358 of the Judgment and the matters referred to therein.

(b) In April 2000, the respondent instructed his accountant, Lombardo to prepare a draft income tax return for submission to St George for the purpose of obtaining a loan for the purchase of 817 Canning Highway, Applecross, and the respondent sent a fax dated 28 April 2000 to Lombardo, for the purpose of the preparation of the draft income tax return, confirming that the sum of $150,000 loaned by Mrs Lee to Keywest International was fee income when the respondent knew that that was not the case, thereby, creating or causing to be created false documents to obtain a financial benefit.

PARTICULARS
The applicant relies on and the respondent does not challenge for the purpose of these proceedings paragraphs 360 and 376 of the Judgment and the matters referred to therein.

(c) The respondent made false statements in a credit application he made of behalf of Ark to Bunnings dated 30 October 2000 in order to get a financial facility from Bunnings.

PARTICULARS

(Page 9)

The applicant relies on and the respondent does not challenge for the purpose of these proceedings paragraphs 361 to 372 of the Judgment and the matters referred to therein.

(d) The respondent lied in an affidavit that he swore in the Action on 17 August 2001.

PARTICULARS
The applicant relies on and the respondent does not challenge for the purpose of these proceedings paragraphs 374 to 375 of the Judgment and the matters referred to therein.

(e) The respondent created or caused to be created false entries in the accounts of Ark that he gave to Mrs Lee in September 2000.

PARTICULARS
The applicant relies on and the respondent does not challenge for the purpose of these proceedings paragraphs 377 to 382 of the Judgment and the matters referred to therein.

(f) The respondent made unauthorised use of the funds of Ark in that the respondent transferred funds to himself and used those funds for his own purposes.

PARTICULARS
The applicant relies on and the respondent does not challenge for the purpose of these proceedings paragraphs 505 to 522 of the Judgment and the matters referred to therein.

5. The applicant alleges and the respondent does not challenge for the purpose of these proceedings that the respondent was found by Roberts-Smith J in the Action to have:

(a) breached fiduciary duties owed to Mrs Lee.

PARTICULARS
Paragraph 465 of the Judgment.

(b) engaged in unconscionable conduct towards Mrs Lee.

PARTICULARS
Paragraph 465 of the Judgment.

(Page 10)

(c) lied and equivocated in his testimony in the Action and demonstrated himself to be deceitful.

PARTICULARS
Paragraphs 341, 342, 343 and 383 of the Judgment.

6. By reason of the matters referred to in paragraphs 3, 4 and 5 above the applicant alleges and the respondent admits that proper cause for disciplinary action exists pursuant to section 103(2) of the Act.

9 We will adopt the definitions used in the Agreed Allegations in these reasons.

10 Following the resolution as to the substantive allegations, and at the request of Mr Mavaddat, the matter was adjourned for submissions on costs and penalty. The reason for the adjournment was to enable Mr Mavaddat to undertake a psychiatric assessment, which his counsel considered might assist in explaining his conduct, and also to provide updated character evidence.

11 There are three bases upon which cause for disciplinary action against Mr Mavaddat exist. The first concerns the breach of s 60(1) and (3) of the Real Estate and Business Agents 1978 (WA) (the REBA Act). That is described in par 1 of the Agreed Allegations.

12 The second is the breach of s 61(3)(c) and (5) of the REBA Act as described in par 2 of the Agreed Allegations.

13 The third is the conduct and findings identified in par 3, par 4 and par 5 of the Agreed Allegations. Those matters comprise admissions as to the creation of false documents related to transactions with Mrs Lee during 1999 to 2000 (par 3.1(a), (b), 4(a), (b), (c), (e)), the making of a false affidavit (par 4(d)), the misuse of Ark's funds (par 4(f)) and findings by Roberts-Smith J in the Action to the effect that Mr Mavaddat breached fiduciary duties, behaved unconscionably towards Mrs Lee and lied and equivocated in his testimony in the Action and demonstrated himself to be deceitful.

The object of disciplinary proceedings

14 There was no dispute between the parties as to the object of disciplinary proceedings, which they accurately identified. The object of imposing disciplinary penalties is the protection of the public, and notwithstanding that the exercise of disciplinary powers may involve a great deprivation of the person disciplined, there is no element of

(Page 11)

punishment involved -NSW Bar Association v Evatt (1968) 117 CLR 177. As well as the protection of the public, disciplinary penalties serve to maintain proper professional standards -Paridis v Settlement Agents Supervisory Board [2007] WASCA 1997 at [25]. It is also necessary to deter others who may be of a like mind to transgress in the future - Jemielita v Medical Board of Western Australia (unreported, WASC, Library No 920584, 13 November 1992) per Owen J.

The Board's submissions

15 The Board acknowledges that Mr Mavaddat admitted, at an early stage of the proceedings, the breach of s 60(2) of the Act which is the subject of par 1 of the Agreed Allegations. It contends that the breach was not merely one of form, nor technical or innocent. It contends that the appropriate penalty is a fine pursuant to s 103(1) of the REBA Act in the moderate to high range. The maximum fine under s 103 is $10,000.

16 In relation to the admitted breach of s 61(3)(c) and s 61(5) of the REBA Act as set out in par 2 of the Agreed Allegations, the Board submits that the appropriate penalty is a substantial fine and cancellation of the respondent's licence and triennial certificate. It observes that, while Mr Mavaddat admitted the receipt of the benefit of $133,000 commission, he denied, up until 27 May 2008 that the commission was "unjust in all the circumstances" and thus a breach of the Act.

17 The fact and amount of commission were set out in a document entitled "Disclosure as a Principal" bearing the seals of the vendor company, and a company controlled by Mr and Mrs Lee, and bearing Mrs Lee's signature. In addition, the contract for sale of the Subiaco property bore a special condition disclosing, in effect, that Mr Mavaddat, whose company was one of the purchasers, was a real estate agent and would receive a commission on the sale. Mr Mavaddat relies on those disclosures as justifying the commission charged.

18 In response to that justification, the Board relies upon conclusions reached by Roberts-Smith J where he found that Mr Mavaddat did not explain the terms of the contract to Mrs Lee and did not give her the opportunity to read it. His Honour also made findings that the vendor had been prepared to sell the property for $690,000. However, when Mr Mavaddat initially presented the offer to the vendor, the offer was for $823,000. After allowing for the commission for $133,000, the vendor was thus left with a price of $690,000 being the amount which it had indicated it would accept for the property. His Honour found that Mrs Lee did not read the disclosure statement before signing it (at [447]) and that Mr Mavaddat's conduct in relation to the commission of $133,000 constituted a breach of his

(Page 12)

fiduciary obligations to the plaintiff (at [449]). The Board relies upon those findings as demonstrating that there was no genuine consent to the charging of what was, quite clearly, an excessive amount of commission. On that basis the Board submits that the breaches of the Act were serious, and should lead to suspension or cancellation of the respondent's triennial certificate or registration.

19 With respect to the allegations in par 3, par 4 and par 5 of the agreed allegations, the Board submits that the respondent should be permanently disqualified from holding a real estate agent's licence. It submits that, until the matter was resolved on 27 May 2008, Mr Mavaddat's response to the allegations was that those findings ought not to be applied by the Tribunal in light of evidence which he proposed to adduce at the hearing of the matter, being evidence not before Roberts-Smith J in the Supreme Court. The Board observes that Mr Mavaddat's approach to the allegations against him was to seek to diminish the significance of his dishonest conduct, or to deny either the falsity of documents or his knowledge of their falsity. The Board relies upon the admitted dishonesty, as evidenced in the false documents, as leading to the conclusion that Mr Mavaddat is not fit to hold a licence. The Board places significant reliance upon the observations of Roberts-Smith J at [383] where his Honour said:

There are many other matters going to the defendant's credibility, some of which it will be necessary to consider later. In light of them and the matters set out above, I conclude the defendant is neither an honest nor a credible witness. I would not accept his testimony on any significant issue and without independent evidence I would not be prepared to accept the genuineness or truthfulness of any document generated by him or at his instigation. I further find that he has demonstrated himself to be deceitful and to manipulate others almost as a matter of course. One could have no confidence that what he told other people about anything, was true.

20 The Board submits that, contrary to Mr Mavaddat's assertions that his conduct was a result of his emotional turmoil relating from his relationship with Mrs Lee, an inference should be drawn that his conduct was prompted by financial need or greed, and his continued denial of the substance of many of the allegations against him arose out of a desire to avoid responsibility for his actions.

Mr Mavaddat's submissions

21 Mr Mavaddat's position is that all of the conduct the subject of the admitted allegations occurred because of the pressures he was under as a result of his relationship with Mrs Lee, and was out of character for him. His position is

(Page 13)

that he had an intimate personal and sexual relationship with Mrs Lee, and that his behaviour the subject of the proceedings before the Tribunal, was entirely a consequence of the existence of that relationship, and his turmoil arising from concern that the relationship might be discovered by his wife. To establish that proposition, the respondent called Dr Oleh Kay, a psychiatrist whom Mr Mavaddat had consulted. In addition, he called a number of business or personal associates who testified that the conduct outlined in the agreed allegations was out of character with Mr Mavaddat as they know him.

22 Mr Mavaddat observes that all of the matters the subject of complaint relate to this dealings with, or connected with, Mrs Lee. He relies on his otherwise unblemished record as a licensed real estate agent as demonstrating that the protection of the public does not require his disqualification or suspension from practice as a real estate agent.

23 In relation to allegations 1 and 2, the respondent submits that a reprimand or a monetary penalty is the appropriate sanction. He relies upon the disclosure documents referred to above to refute the suggestion of the Board that his conduct in relation to allegations 1 and 2 was "surreptitious". He admits that he received the benefit of $133,000 by way of commission from the sale of the Subiaco property, but points out that that sum was repaid to Mrs Lee following judgment in the Action.

24 The respondent does not, in his written submissions, identify what penalty should be imposed in relation to the matter set out in par 3 to par 5 of the Agreed Allegations. He submits, however, on the basis of the evidence called by him, that neither suspension nor disqualification is appropriate.

25 Dr Kay was consulted by Mr Mavaddat on three occasions in June and July 2008. He had been provided with the Agreed Allegations and an extract of various paragraphs of Roberts-Smith J's judgment that were referred to in the Agreed Allegations. He did not read the whole of the judgment. Dr Kay related the history given to him by Mr Mavaddat, including his background. Mr Mavaddat told him that he had been having a "secret relationship with Mrs Lee". He described his relationship with Mrs Lee as being "intensely personal and passionate but one that he was fearful that other people would discover", in particular his wife but also Mrs Lee's husband who was resident in Hong Kong.

(Page 14)

26 Dr Kay concluded that "if the relationship was as intense as he describes it as being", he could see it as being a significant causative factor in explaining why Mr Mavaddat acted as he did in his dealings with Mrs Lee, her husband, Bunnings and the bank". He said that these were "examples of muddled thinking". He said that he saw that behaviour as "an example of wanting or needing to please Mrs Lee who in a sense had the 'whip hand' over him emotionally". He said that the relationship "caused Mr Mavaddat anxiety and panic and clouded his judgment in relation to other matters associated with Mrs Lee and her husband". He said that the events the subject of complaint appear to have occurred within a relatively short period of time.

27 Dr Kay concluded that there was no evidence of any psychiatric abnormality in Mr Mavaddat. Rather, he said, Mr Mavaddat has a particular personality prevalent in people who are involved in sales. He did not consider that there should be any concern in Mr Mavaddat's dealings with the public in future.

28 The respondent also relied upon character references from Mr Mark Andrews, a solicitor and personal friend of Mr Mavaddat's family. He also called a number of business associates who had had dealings with Mr Mavaddat, being Mr Robert Cocking, a property developer; Mr Ron Farris, a real estate agent; Mr Shane Jacob, a settlement agent, and Mr John McKenzie, an architect. Each of those gave evidence orally, and were cross-examined by counsel for the Board. With the exception of Mr Farris, who had known and had dealings with Mr Mavaddat over a 20-year period, and Mr McKenzie, who had known Mr Mavaddat for some eight years, the other witnesses had known Mr Mavaddat for periods of four or five years, being after most of the events subject to these proceedings had occurred.

29 In addition, the respondent relied upon written references from Mr Len Brajkovich, a business associate of Mr Mavaddat, and Mr Mavaddat's accountant and tax agent, Mr Hugh Barrett Walker.

30 In his written submissions, the respondent asserted that the Tribunal can be confident that the public is not at risk in relation to his continued practice because his prospects of reoffending are minimal on the following basis:

"i. He has an awareness of the consequences of his behaviour and is equipped with understanding and other strategies in respect of his behaviour;

(Page 15)

ii. He feels responsible for adding stress to his family due to his actions, the Defendant's remorse in that respect have [sic] also served as a lasting personal deterrent;

iii. In essence, as a result of his stupidity he has required at 52 years of age to start again with his life;

iv. His actions were not related to his practice or business but rather his personal transactions. He has paid a high price for his failure to act in a proper manner - being required to fully indemnify Mrs Lee in respect of her losses;

v. As a result of publicity surrounding the action and these proceedings he has suffered public humiliation – a very salutary lesson had.

Is disqualification appropriate?

31 It is appropriate to consider the penalty which should be imposed in relation to par 3, par 4 and par 5 of the Agreed Allegations first, as the Board principally relies upon those allegations for the proposition that Mr Mavaddat's registration should be permanently disqualified.

32 The admissions made by Mr Mavaddat are of serious misconduct. He admits that he lied in statements made to Mr Lee in a facsimile dated 6 December 1999. It was found by Roberts-Smith J that much, if not most, of what was in that facsimile were lies. At [343]-[352] of Roberts-Smith J's reasons, he identifies the lies contained in the document, and notes Mr Mavaddat's attempt to "evade, to obfuscate, to dissemble and to attribute blame to the plaintiff" in relation to those lies. In those paragraphs, Roberts-Smith J makes references to passages in the transcript where Mr Mavaddat asserts that he was coerced by Mrs Lee to lie in the document. His Honour noted, at [352], that it was never suggested to Mrs Lee in cross-examination that she had manipulated Mr Mavaddat into sending the facsimile containing lies. His Honour concluded that Mr Mavaddat's evidence "strikingly suggests desperate fabrication on the run" in cross-examination.

33 The respondent also admits that he overstated his income in a letter seeking financial accommodation from St George. He admitted that, in April 2000, he instructed his accountant to prepare a draft income tax return falsely identifying a sum of $150,000 as fee income in order to obtain a financial benefit, namely an advance of funds from St George.

34 He further admits that he made false statements in a credit application to Bunnings on 30 October 2000 and that he lied in an affidavit he swore in the Supreme Court Action on 17 August 2001. When questioned in the Supreme

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Court proceedings about his preparedness to lie in order to get financial accommodation from Bunnings, he responded "I will not be the first one. It is industry standard". The lie contained in the affidavits filed in the Action was found by Roberts-Smith J at [375] to demonstrate that Mr Mavaddat "is prepared to lie on oath to advance his case and that he is prepared to present false documents to the court to bolster his lies."

35 Mr Mavaddat further admitted that he created false entries in the accounts of Ark. He was found by Roberts-Smith J to be responsible for the creation of a number of false entries in the accounts. One entry was found (at [381]) to have been created for the purpose of concealing the purpose for which he had transferred money into his own account.

36 Mr Mavaddat has admitted making unauthorised use of Ark funds. That included an amount of $60,000 used to pay for a trip to China and to defray his own personal and business expenses, and to pay for the air fare and other expenses of his secretary, with whom he was then having a sexual relationship. The use of those funds was found by Roberts-Smith J to be a breach of his fiduciary obligations to Mrs Lee. He admits that he caused Ark to advance $150,000 for use in the purchase by Mr Mavaddat's business of new premises in Applecross. That payment was also found to constitute a breach of his partnership agreement with Mrs Lee, and his fiduciary duty to her. He also drew $4,000 from the Ark's account, apparently for his own purposes. Finally, Roberts-Smith J found that seven other payments totalling $5,758.84 were made from Ark's funds by Mr Mavaddat in breach of his fiduciary duties to Mrs Lee (see [513]-[522] of Robert-Smith J's reasons).

37 The respondent contends that the conduct set out above occurred independently of his practise as a real estate agent and related to his business dealings associated with Mrs Lee. That is a distinction which we do not think can be properly drawn. Mr Mavaddat met Mr and Mrs Lee through his work as a real estate agent. He assisted them in relation to various real estate transactions. The misleading communication with Mr Lee on 6 December 1999 was concerned with the purchase of a property in respect of which Mr Mavaddat took a commission of $133,000. The allegations concerning misuse of funds did not relate to funds held in his capacity as a real estate agent. However, they were funds which, in effect, he controlled on behalf of others. Dishonesty in relation to those funds is cause for concern about how he might act generally in relation to funds held on behalf of others, even though he has not misused funds as a real estate agent.

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38 It was not in issue between the parties that honesty is an essential attribute of a person licensed as a real estate agent. The nature of the admitted dishonesty by Mr Mavaddat, comprising as it does a series of intentional lies, creation of false documents and misuse of funds, is so serious that, in the absence of some adequate explanation, it must be concluded that Mr Mavaddat is unfit, by reason of his dishonesty, to hold a real estate agent's licence.

39 We are not persuaded that Mr Mavaddat's conduct can simply be considered an aberration flowing from his relationship with Mrs Lee. It is true, as counsel for the respondent observed, that from time to time during his evidence before Roberts-Smith J, Mr Mavaddat made reference to being coerced, or under the influence of and pressured by Mrs Lee. It is apparent, however, that Robert-Smith J did not accept that explanation. His Honour did conclude, (at [395]) that Mrs Lee's relationship with Mr Mavaddat was closer than she was prepared to admit, but he did not accept that it was an intimate sexual relationship. The true nature of Mr Mavaddat's relationship with Mrs Lee was not the subject of any conclusive findings by Roberts-Smith J.

40 Mr Mavaddat did not give evidence in these disciplinary proceedings. The assertion as to the nature of his relationship comes through his account of events given to Dr Kay and from the submissions of his counsel. During cross-examination, Dr Kay acknowledged that what Mr Mavaddat told him was at variance with what Roberts-Smith J found at trial. He said that Mr Mavaddat spent quite some time refuting the findings and explaining the way the evidence had been produced at trial. Dr Kay considered himself bound to accept as truthful everything that he was told by Mr Mavaddat, and formed his opinion based upon the veracity of what he was told. It became apparent, however, that Mr Mavaddat did not mention a number of relevant matters to Dr Kay, and in some respects gave an account of events which appears to conflict with his evidence, and the findings made in the Action. There are a number of examples.

41 Dr Kay understood that, at the same time as he was having a sexual relationship with Mrs Lee, Mr Mavaddat was having a sexual relationship with his secretary as well as his wife. However, what Dr Kay was apparently told as to the extent of the emotional relationship between Mr Mavaddat and his secretary appears to be in conflict with the evidence

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Mr Mavaddat gave in the action as to his distress when the secretary terminated the relationship.

42 Mr Mavaddat did not disclose to Dr Kay that, at the time of the events surrounding the Subiaco contract in 1999, his bank was dishonouring cheques and he was in a degree of financial difficulty. On the contrary, Mr Mavaddat told Dr Kay that, at the relevant time, his finances were "in pretty good shape". The dishonouring of the cheques was a matter established in the Action, and Mr Mavaddat's apparent misstatement of his financial position to Dr Kay essentially concealed what might be thought to have been a motive for his conduct at the time, namely financial gain.

43 In relation to the money taken from Ark, including money which was used for Mr Mavaddat's personal purposes, Dr Kay was apparently told that there were "some inconsistencies in accounting records" and that he was having difficulties with his accountant.

44 In relation to his explanation for wrongly claiming to possess a Bachelor of Science degree, Dr Kay was not told that the qualification was used in correspondence with financial institutions, and there is an apparent inconsistency between the explanation he gave for wrongly using that qualification from that which he proffered in evidence in the Action.

45 Dr Kay was not aware that Mr Mavaddat had said in evidence that his overstatement of his financial position in a claim for credit from Bunnings was "industry practice".

46 Mr Mavaddat told Dr Kay that his emotional turmoil arose from his concern that others may find out about his relationship with Mrs Lee. He did not disclose, as the evidence in the Action apparently revealed, that he and Mrs Lee frequently dined together in public restaurants and that he had told a family friend of his relationship with Mrs Lee. Dr Kay accepted that that evidence was inconsistent with what Mr Mavaddat told him. The inconsistency goes to the heart of what Dr Kay accepted as the motivating factor explaining Mr Mavaddat's behaviour.

47 According to Dr Kay, Mr Mavaddat's principal justification for the findings against him in the action was that he blamed the findings on ineffective legal representation, and he considered himself to have been "set up as a sacrificial lamb".

48 None of the above inconsistencies caused Dr Kay to alter his opinion that Mr Mavaddat does not suffer from a psychiatric abnormality. Having expressed that view, however, his opinion does no more than accept what, in effect,

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Mr Mavaddat explained to him as being the cause for his conduct. The explanation proffered by Mr Mavaddat is, of course, entirely self-serving.

49 There are three reasons why we do not consider the explanation reliable. The first is the inconsistencies in the account given to Dr Kay compared to the evidence in the Action and the findings of Roberts-Smith J. The second is that Mr Mavaddat appears to have explained away the adverse outcome of the Action on the basis of legal representation, and as though there was simply a preference of the evidence of other witnesses over Mr Mavaddat's evidence. That approach ignores Mr Mavaddat's own admissions in these proceedings as to his dishonesty. For example, the misuse of Ark funds cannot be explained as inconsistencies in accounting records or by problems with his accountant. It was demonstrated at trial, and is now admitted by Mr Mavaddat, that he misused funds for his personal purposes. Furthermore,thedishonesty of the documents referred to in the Agreed Allegations was demonstrated by evidence at trial, and is admitted by Mr Mavaddat in these proceedings. Those findings of dishonesty are now admitted to be correct and their significance cannot be reduced by attributing them to inadequate legal representation.

50 The third reason is that the explanation for the conduct is not provided by evidence from Mr Mavaddat in these proceedings, with the result that he did not subject himself to cross-examination in relation to his motives. Accordingly, the Tribunal is merely invited to accept what appears to be a somewhat incomplete history given to Dr Kay as the basis of the explanation for Mr Mavaddat's conduct.

51 We accept that each of the character witnesses who gave evidence before the Tribunal considered Mr Mavaddat's admitted conduct to be out of character with their own experience of him. It is apparent, however, that, at least in most cases, Mr Mavaddat was somewhat dismissive with each of those who gave evidence on his behalf as to the findings against him. In Mr Jacob's case, Mr Mavaddat told him that the decision was not correct, and that he was not happy with it. They apparently had a brief discussion about the action, but Mr Jacob did not feel it his place to seek any explanation of what had occurred. Mr Farris considered that the findings by Roberts-Smith J were wrong; that the decision did a "gross injustice" to Mr Mavaddat. He had only, however, had a brief discussion with Mr Mavaddat about the findings.

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52 Mr Cocking spoke "very briefly" to Mr Mavaddat about the circumstances leading to Roberts-Smith J's findings, but did not ask him what led to the findings. Mr Mavaddat apparently told Mr Cocking that the allegations were incorrect and Mr Cocking accepted that, preferring to make his judgment upon Mr Mavaddat based upon his personal dealings with him, not some other person's views.

53 Mr Andrews had a discussion with Mr Mavaddat concerning the circumstances giving rise to the dispute with Mrs Lee. It was apparent to Mr Andrews that Mr Mavaddat had "immense difficulty accepting the findings in the judgment". Mr Andrews characterised Mr Mavaddat's conduct as being a result of a breakdown of a commercial relationship, although he did not seek an explanation of the admitted allegations in specific terms.

54 Mr McKenzie said he was amazed by the findings by Roberts-Smith J which he read in full. Notwithstanding the findings, he assessed Mr Mavaddat's character on the basis of his own dealings with him.

55 It is apparent that, speaking generally, Mr Mavaddat sought to downplay the findings against him to the character witnesses in a similar way to that which he did with Dr Kay. While one may accept that a litigant might disagree with findings of credibility, and a preference of the evidence of other witnesses over himself, the admitted dishonesty contained in the Agreed Allegations does not lend itself to being explained away in that fashion.

56 We accept that those who gave evidence in these proceedings have had no cause to be concerned about Mr Mavaddat's conduct in his business or personal dealings with them. In our view, however, that does not lead to the conclusion that there is no danger of Mr Mavaddat in future displaying the same level of dishonesty as he did in relation to the matters the subject of the Agreed Allegations, if appropriate circumstances presented themselves in the future.

57 In TheRegistrar, Real Estate and Business Agents Supervisory Board v Barnett (unreported, FCt, WASC, Library No 970426, 26 August 1997), Kennedy J (with whom Barker J agreed) endorsed what was said in Sobey v Commercial and Private Agents Board (1979) 22 SASR 70 at 76 by Walters J that:

The issue whether an appellant has shown himself to be 'a fit and proper person', within the meaning of s 16(1) of the [Commercial and Private Agents Act], is not capable of being stated with any degree of precision.

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But for the purposes of the case under appeal, I think all I need to say is that, in my opinion, what is meant by that expression is that an applicant must show not only that he is possessed of a requisite knowledge of the duties and responsibilities devolving upon him as the holder of the particular licence under the Act, but also that he is possessed of sufficient moral integrity and rectitude of character as to permit him to be safely accredited to the public, without further inquiry, as a person to be entrusted with the sort of work which the licence entails (cf Ex parte Meagher (1919) 19 SR (NSW) 433, at 442).

58 In Grljusich v Andrews [2003] WASCA 206 at [142] the Full Court, in dealing with the question of penalty under the REBA Act referred to the passage from the New South Wales Bar Association v Evatt (1968) 117 CLR 177 where the Court (at 183) said:

The power of the court to discipline a barrister is, however, entirely protective, and, notwithstanding that its exercise may involve a great deprivation to the person disciplined, there is no element of punishment involved. … The respondent's failure to understand the error of his ways of itself demonstrates his unfitness to belong to a profession where, in practice, the client must depend upon the standards as well as the skill of his professional adviser.

59 We consider that Mr Mavaddat's admitted conduct, and the findings made by Roberts-Smith J demonstrates that he is not possessed "of sufficient moral integrity and rectitude of character to permit him to be accredited to the public". That conclusion is fortified by Mr Mavaddat's apparent reluctance to accept the seriousness of his admitted wrongdoing.

60 In our view, the appropriate penalty for the conduct the subject of par 3, par 4 and par 5 of the Agreed Allegations is cancellation of his licence. The issue which then arises is whether that disqualification should be permanent, or for some specified period.

61 In Grljusich, the court also made reference to what was said by Walsh JA in Ex parte Tziniolis; Re Medical Practitioners Act (1967) 67 SR (NSW) 448 at 461 where it was said:

One cannot assume that a change has occurred merely because some years have gone by and it is not proved that anything of a discreditable kind has occurred. If a man has exhibited serious deficiencies in his standards of conduct and his attitudes, it must require clear proof to show that some years later he has established himself as a different man.

62 We have noted above, (at [30]) the assertions made by the respondent as demonstrating that the public is not at risk in relation to his continued practise. In relation to the first of those, nothing in the materials or oral evidence
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before us establishes that Mr Mavaddat is "equipped with understanding and other strategies in respect of his behaviour". An awareness of the consequences of improper behaviour is an inevitable result of any disciplinary proceedings. The personal consequences of the action and these proceedings are also common to most, if not all, respondents to successful disciplinary proceedings. The extent to which those personal consequences may, in fact, act as a personal deterrent to Mr Mavaddat would seem to us to be reduced by his apparent reluctance to accept the seriousness of his wrongdoing, and of the findings made against him. We have already observed that we do not consider it accurate to say that his actions were not related to his practise or business as a real estate agent.

63 In Grljusich, the Full Court reduced the permanent disqualification imposed by the Board in that case to a disqualification for a period of five years. We accept the submission of the Board that the conduct the subject of complaint in this case, extending as it did over several years, and involving a series of dishonest actions, distinguishes this case from the facts of Grljusich. We are not satisfied that Mr Mavaddat can be held out to the public as possessed of the honesty and moral integrity required of an accredited real estate agent. In our view, by reason of the matters referred to in par 3, par 4 and par 5 of the Agreed Allegations, Mr Mavaddat's licence as a real estate agent, and his triennial certificate in respect thereof, should be cancelled, and Mr Mavaddat should be disqualified permanently from holding a licence or triennial certificate.

Breach of s 61(3)(c) and s 61(5) REBA Act

64 As observed above, the Board submits that these breaches should lead to suspension or cancellation of the respondent's triennial certificate and licence.

65 The amount of the commission charged in relation to the sale of the Subiaco property was many times what might be considered a normal level of commission. Having regard to that fact, and the findings made as to the circumstances in which the commission was obtained, we consider that, viewing these breaches in isolation, a period of suspension of Mr Mavaddat's triennial certificate would have been the appropriate penalty. Taking account of the fact that the commission was ultimately paid back to Mrs Lee following the action, we consider that a suspension of six months would be appropriate in relation to these breaches. However, because of the disqualification for the other matters, no separate order for suspension is called for.

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Breach of s 60(2) of the REBA Act

66 We agree with the Board that, in the circumstances of this breach, a fine is appropriate. We are mindful of the seriousness of the penalty of cancellation of Mr Mavaddat's licence which we have determined is appropriate in relation to par 3, par 4 and par 5 of the Agreed Allegations. For that reason, we consider that a fine lower than what might have been imposed for the conduct identified in par 1 of the Agreed Allegation taken alone, is appropriate. We are conscious that cancellation of Mr Mavaddat's licence has very serious financial and personal consequences, and it would be inappropriate to fix a fine without regard to those consequences. In our view, in relation to the allegations in par 1 of the Agreed Allegations, Mr Mavaddat should be fined an amount of $1,000.

Costs

67 There was no dispute between the parties as to the general approach to costs which should be taken by the Tribunal in this case. Both agreed that the approach explained by the President of the Tribunal in Motor Vehicle Industry Board and Dawson [2006] WASAT 8 at [44]-[48] is appropriate. In that case, his Honour said:

Where proceedings are commenced by a vocational regulatory body (such as the Board) against a person affected by a vocational Act (such as Mr Dawson), the Tribunal will usually make an order for costs in favour of the vocational regulatory body where it is successful in obtaining an order in the proceedings. In Medical Board of Western Australia and Roberman[2005] WASAT 81(S) at [30] the Tribunal (Judge John A Chaney SC, Deputy President, presiding member) observed in relation to s 87(2) that:

"Where a regulatory authority successfully brings a complaint of conduct which, if proved, justifies disciplinary action by the Tribunal, there will usually be a strong case for the exercise of that discretion in favour of the regulatory body. That is because such bodies perform a function which promotes the public interest, and usually with limited resources. The financial burden of bringing disciplinary action if the body had no capacity to recover some or all of its costs may be such as to provide a disincentive to bring disciplinary action, or when brought, to ensure that the allegations against the practitioner concerned are properly and thoroughly presented. It is in the public interest that such bodies have an expectation that, if the allegations are made out, the offending professional will meet or at least contribute to the costs incurred in bringing the application. The question of an award of costs is, of

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course, a matter of discretion to be exercised in the circumstances of each case."

With those observations the Tribunal concurs.

In the Roberman case, however, the Medical Board of Western Australia was unsuccessful in relation to some of the allegations made against the medical practitioner. For that reason the Tribunal in its discretion considered it was appropriate that the practitioner only pay one-third of the costs of the Medical Board. In so doing the Tribunal implicitly recognised that a person affected by proceedings instituted by a vocational regulatory body should not have to bear the costs of the proceedings or contribute to the costs of those part of the proceedings which were not successfully maintained.

The decision in the Roberman case does not support the view, however, that an affected person in such proceedings is entitled to an award of costs for the portion of the proceedings in which they were successful. If this approach were to be adopted, vocational regulatory bodies may well feel inhibited in commencing proceedings that should be commenced and maintained in the public interest even though "success" cannot be guaranteed. Consequently, the Tribunal considers that, ordinarily, unless it can be demonstrated that an application made by a vocational regulatory body lacked any reasonable basis or was not made in good faith, costs should not be awarded against a vocational regulatory body simply because the application was not successful.

Of course, in every case the Tribunal retains the discretion under s 87(2) of the SAT Act to order costs in the circumstances of the case.

68 The issue between the parties is as to the costs associated with the matters which were the subject of the complaint but were not pursued by the Board following the agreement on 27 May 2008. The respondent contends that, the Board having effectively abandoned those allegations, it should not be entitled to recover costs which are referable to those allegations.

69 The Board contends that there was a reasonable foundation for the making of the allegations which were not pursued, and that it was reasonable for it to accept the compromise which resulted in Mr Mavaddat accepting most of the allegations made against him.

70 We agree that, on the basis of the findings of Roberts-Smith J, there was a reasonable foundation for the allegations which were not pursued. It is apparent that the compromise which was ultimately achieved arose at Mr Mavaddat's instigation. It resulted in admission of the majority of the allegations, most of which were not accepted by Mr Mavaddat up until 27 May 2008. The matter had been listed for eight days. That time was allocated on the

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basis that Mr Mavaddat's proposed to cross-examined Mrs Lee, and call other evidence to establish the defences outlined in the respondent's Statement of Issues, Facts and Contentions. The admissions ultimately made in the Agreed Allegations were sufficient to establish the existence of cause for disciplinary action, and, we have found, to support permanent disqualification of Mr Mavaddat's licence. Acceptance of the Agreed Allegations had the consequence of saving both the Board and Mr Mavaddat very substantial costs.

71 In the circumstances, where it is apparent that the "abandonment" of a relatively small number of allegations occurs as part of a compromise involving acceptance of the bulk of the allegations, the Board should not be deprived of a proportion of its costs of bringing the application.

72 In our view, it is appropriate that Mr Mavaddat pay the costs of the proceedings in an amount to be agreed, or if not agreed, to be determined by the Tribunal.

Orders

1. By reason of the matters identified in par 3, par 4 and par 5 of the Agreed Allegations dated 27 May 2008, the real estate agent's licence held by Michael Moojan Mavaddat and any triennial certificate in respect thereof is cancelled, and Mr Mavaddat is disqualified permanently from holding a licence or triennial certificate.

2. By reason of the matters referred to in par 1 of the Agreed Allegations dated 27 May 2008, the respondent is to pay to the applicant a fine in the sum of $1,000, such fine to be paid within 30 days of the date of this order or such further time as the Board may permit.

3. The respondent is to pay the applicant's costs of the proceedings in an amount to be agreed, or failing agreement to be determined by the Tribunal.

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I certify that this and the preceding [72] paragraphs comprise the reasons for decision of the State Administrative Tribunal.

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JUDGE J CHANEY, DEPUTY PRESIDENT