Wills v Chief Executive Officer of the Australian Skills Quality Authority
[2022] FCAFC 10
•9 February 2022
FEDERAL COURT OF AUSTRALIA
Wills v Chief Executive Officer of the Australian Skills Quality Authority [2022] FCAFC 10
Appeal from: Site Skills Group Pty Ltd and Australian Skills Quality Authority [2020] AATA 4805 File number(s): QUD 401 of 2020 Judgment of: LOGAN, GRIFFITHS AND PERRY JJ Date of judgment: 9 February 2022 Catchwords: ADMINISTRATIVE LAW – appeal on a question of law from a decision of the Administrative Appeals Tribunal (Tribunal) affirming a decision of the Australian Skills Quality Authority to reject the second respondent’s application to renew its registration as a Registered Training Organisation under the National Vocational Education and Training Regulator Act 2011(Cth) – where Tribunal found that the second respondent failed to comply with Standard 7.1 of the Standards for Registered Training Organisations (RTOs) 2015 (2015 RTO Standards) by reason of its failure to ensure that the applicant satisfied criterion (i) of the Fit and Proper Person requirements in Sch 3 to the 2015 RTO Standards – where applicant alleged breach of procedural fairness – where the applicant was afforded an opportunity to respond but failed to take it by pressing a misconstruction of the first respondent’s case – where counsel for the applicant declined adjournment following clarification of the first respondent’s case – whether finding of dishonesty or fraud made without notice – discussion of principles by which it is determined whether there is a breach of procedural fairness – no denial of procedural fairness – appeal dismissed
PRACTICE AND PROCEDURE – where first respondent objected to the competency of the appeal – whether appeal constituted abuse of process – where applicant sought leave to rely on further amended notice of appeal – leave granted in the interests of justice
Legislation: Administrative Appeals Tribunal Act 1975 (Cth) ss 30(1A), 37(2), 38AA, 41, 44
Education Services for Overseas Students Act 2000 (Cth) s 83(3)(c)
Higher Education Support Act 2003 (Cth)
National Vocational Education and Training Regulator Act 2011 (Cth) ss 2A, 3, 17, 33, 36(2)(f), 39, 185, 186
Federal Court Rules 2011 (Cth) r 33.31
Cases cited: Allesch v Maunz [2000] HCA 40; (2000) 203 CLR 172
Australian Competition and Consumer Commission v Productivity Partners Pty Ltd (trading as Captain Cook College) (No 3) [2021] FCA 737
Australian Competition and Consumer Commission v Unique International College [2017] FCA 727
Briginshaw v Briginshaw (1938) 60 CLR 336
Collector of Customs v Pozzolanic Enterprises Pty Ltd (1993) 43 FCR 280
Commissioner for Australian Capital Territory Revenue v Alphaone Pty Ltd (1994) 49 FCR 576
Fang Wang v Minister for Immigration and Multicultural and Indigenous Affairs [2003] FCA 1044
Federal Commissioner of Taxation v Primary Health Care Ltd [2017] FCAFC 131; (2017) 252 FCR 496
Haritos v Federal Commissioner of Taxation [2015] FCAFC 92; (2015) 233 FCR 315
Kioa v West (1985) 159 CLR 550
Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24
Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259
Minister for Immigration and Multicultural Affairs v Bhardwaj [2002] HCA 11; (2002) 209 CLR 597
Muin v Refugee Review Tribunal [2002] HCA 30; (2002) 76 ALJR 966
Re Refugee Review Tribunal; Ex parte Aala [2000] HCA 57; (2000) 204 CLR 82
Repatriation Commission v Owens (1996) 70 ALJR 904
Site Skills Group Pty Ltd and Australian Skills Quality Authority [2020] AATA 1919
Site Skills Group Pty Ltd v Administrative Appeals Tribunal [2019] FCA 1970
SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs [2006] HCA 63; (2006) 228 CLR 152
VAAD v Minister for Immigration and Multicultural and Indigenous Affairs [2005] FCAFC 117
Division: General Division Registry: Queensland National Practice Area: Administrative and Constitutional Law and Human Rights Number of paragraphs: 145 Date of hearing: 9 August 2021 Counsel for the Applicant: Mr J Giles SC with Mr P Knowles Solicitor for the Applicant: MinterEllison Counsel for the First Respondent: Ms M Brennan QC with Ms S Wright Solicitor for the First Respondent: Australian Government Solicitor Counsel for the Second Respondent: The Second Respondent filed a submitting notice save as to costs ORDERS
QUD 401 of 2020 BETWEEN: VERNON WILLS
Applicant
AND: CHIEF EXECUTIVE OFFICER OF THE AUSTRALIAN SKILLS QUALITY AUTHORITY
First Respondent
SITE SKILLS GROUP PTY LTD ACN 153 744 417
Second Respondent
ORDER MADE BY:
LOGAN, GRIFFITHS AND PERRY JJ
DATE OF ORDER:
9 FEBRUARY 2022
THE COURT ORDERS THAT:
1.Leave is granted to amend the notice of appeal in terms of the proposed further amended notice of appeal emailed by the applicant’s solicitors to the Court on 9 August 2021.
2.The appeal under s 44 of the Administrative Appeals Tribunal Act 1975 (Cth) against the Administrative Appeals Tribunal’s decision given on 30 November 2020 is dismissed.
3.The applicant is to pay the first respondent’s costs as agreed or assessed.
THE COURT NOTES THAT:
4.The parties are to endeavour to agree the quantum of costs payable under order 3, fixed if possible in a lump sum pursuant to r 40.02(b) of the Federal Court Rules 2011 (Cth).
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
REASONS FOR JUDGMENT
LOGAN J:
I have had the privilege of reading in draft the judgment to be delivered by Perry J. I agree with the orders that her Honour proposes and with her Honour’s reasons for the making of those orders.
I certify that the preceding one (1) numbered paragraph is a true copy of the Reasons for Judgment of the Honourable Justice Logan. Associate:
Dated: 9 February 2022
REASONS FOR JUDGMENT
GRIFFITHS J:
I agree with the proposed orders and Perry J’s reasons for judgment.
I certify that the preceding one (1) numbered paragraph is a true copy of the Reasons for Judgment of the Honourable Justice Griffiths. Associate:
Dated: 9 February 2022
REASONS FOR JUDGMENT
PERRY J:
1 INTRODUCTION
[3]
2 THE COMPETENCY OF THE SECTION 44 APPEAL AND FURTHER AMENDED NOTICE OF APPEAL
[11]
3 LEGISLATIVE FRAMEWORK
[16]
4 THE FACTUAL CONTEXT AGAINST WHICH THE GROUNDS OF APPEAL FALL TO BE CONSIDERED
[28]
4.1 The decisions by ASQA with respect to SSG and the related company, Productivity Partners Pty Ltd
[29]
4.2 The application to the Tribunal for merits review of the ASQA PP decision
[38]
4.3 The application to the Tribunal for review of the ASQA SSG decisions
[41]
4.3.1 The grant of a stay of the ASQA SSG decisions
[41]
4.3.2 The Tribunal’s ruling permitting ASQA to raise the issue of compliance with Standard 7.1 and the challenge to that ruling in the Federal Court
[43]
4.3.3 ASQA’s first 7.1 SFIC (18 March 2019)
[48]
4.3.4 ASX announcement of replacement of Mr Wills as CEO of SSG (26 March 2019)
[52]
4.3.5 First tranche of the Tribunal hearing (15 to 24 May 2019)
[53]
4.3.6 Joinder of Mr Wills and issues and contentions regarding Standard 7.1
[54]
4.3.7 ASQA’s Amended 7.1 SFIC dated 26 May 2020
[59]
4.3.8 Correspondence seeking clarification of ASQA’s contention at [85] of its Amended 7.1 SFIC
[67]
4.3.9 The Further Wills SFIC
[78]
4.3.10 The second tranche of the Tribunal hearing
[80]
4.3.11 Oral submissions as to the scope of ASQA’s case and the ruling by the Tribunal on 6 July 2020
[82]
4.3.12 The parties’ closing submissions
[90]
4.4 The Tribunal’s SSG decisions
[93]
5 DISPOSITION OF THE SECTION 44 APPEAL
[113]
5.1 Did the Tribunal act in breach of procedural fairness (Ground 1)?
[113]
5.1.1 Relevant principles
[113]
5.1.2 No breach of procedural fairness has been established
[121]
5.2 Did the Tribunal fail to consider a relevant consideration (Ground 2)?
[144]
6 CONCLUSION
[145]
1. INTRODUCTION
The applicant, Mr Vernon Wills, was the sole director and Chief Executive Officer (CEO) of the second respondent, Site Skills Group Pty Ltd (SSG).
On 3 April 2012, SSG was registered as a Registered Training Organisation (RTO) under s 17 of the National Vocational Education and Training Regulator Act 2011 (Cth) (NVR Act) by the National VET Regulator, Australian Skills Quality Authority (ASQA), and thereby became an RTO within the meaning of s 3 of the NVR Act. Pursuant to its registration as an RTO and approved VET provider, SSG engaged in the provision of vocational education and training (VET) courses to students for which it received fees paid directly by the Commonwealth pursuant to the VET FEE-HELP assistance scheme as a consequence of which students would incur a debt to the Commonwealth: see further the helpful overview of the VET FEE-HELP assistance scheme in Australian Competition and Consumer Commission v Unique International College [2017] FCA 727 at [5] (Perram J).
SSG has filed a submitting appearance in this proceeding save as to costs.
On 18 April 2018, the first respondent, the Chief Executive Officer of ASQA, made a decision relevantly rejecting SSG’s application for renewal of its registration as an RTO. That decision was affirmed by the decision of the Administrative Appeals Tribunal (Tribunal) given on 30 November 2020 on the ground that SSG had failed, and continued to fail, to comply with Standard 7.1 of the Standards for Registered Training Organisations (RTOs) 2015 (2015 RTO Standards) by reason of its failure to ensure that Mr Wills, executive officer of SSG, satisfied criterion (i) of the Fit and Proper Person requirements in Sch 3 to the 2015 RTO Standards (the F&PP requirements).
Mr Wills challenges the Tribunal’s decision by an “appeal … on a question of law” under s 44(1) of the Administrative Appeals Tribunal Act 1975 (Cth) (AAT Act). As such, this Court has jurisdiction to grant relief in the event that Mr Wills establishes that the Tribunal erred in law, but not to determine the merits of the Tribunal’s decision. In this regard, s 44 of the AAT Act is concerned to ensure that the merits of the case are dealt with by the Tribunal and not by the Court, reflecting a “distribution of function [which] is critical to the correct operation of the administrative review process”: Repatriation Commission v Owens (1996) 70 ALJR 904 at 904 (the Court (refusing special leave to appeal to the High Court of Australia)), cited in Haritos v Federal Commissioner of Taxation [2015] FCAFC 92; (2015) 233 FCR 315 at [133] (the Court).
By Ground 1 of the appeal, Mr Wills contends that the Tribunal denied him procedural fairness in finding that he did not satisfy the F&PP requirements based on his involvement in the affairs of another RTO, Productivity Partners Pty Ltd (PP) (trading as Captain Cook College), which was a subsidiary of the same parent company as SSG. The particulars of Ground 1 include:
(1)the failure by ASQA to clearly articulate the nature of its case against Mr Wills;
(2)the confused way in which ASQA ultimately put its case (described by Mr Wills as an “incoherent ‘half-way house’”) despite Mr Wills’ repeated requests for clarification;
(3)the fact that the Tribunal made findings concerning the matters underlying ASQA’s decision to cancel PP’s registration despite ASQA having expressly stated that it did not advance its case on that basis; and
(4)the Tribunal’s finding at [156] (including footnote 113) of its reasons delivered on 30 November 2020 (TR) made without notice to Mr Wills that PP or Mr Wills was involved in a fraudulent or dishonest manipulation of the system of public funding of vocational education.
Ground 2 alleges that the Tribunal failed to give active intellectual consideration to a relevant consideration in that “it did not make findings on the critical issue of Mr Wills’ involvement and knowledge in what it determined to be [the] critical issue, the fact that PP was (the Tribunal found) involved in a fraudulent and dishonest manipulation of the system of public funding of vocational education” (applicant’s submissions dated 13 July 2021 (AS) at [31]). This ground and the complaint on procedural fairness grounds challenging the same finding turn in the first instance on the proper construction of paragraph [156] of the Tribunal’s reasons and its accompanying footnote, read fairly in the context of the Tribunal’s reasons as a whole.
For the reasons set out below, neither ground is established and the s 44 appeal must be dismissed with costs.
2. THE COMPETENCY OF THE SECTION 44 APPEAL AND FURTHER AMENDED NOTICE OF APPEAL
As originally filed, Mr Wills’ notice of appeal sought to appeal “from part of the Tribunal’s decision, being its finding that the Applicant did not satisfy the requirement in subparagraph (i) of Schedule 3 of the [2015 RTO Standards]”. The orders sought were to set aside the Tribunal’s decision insofar as the Tribunal found that Mr Wills did not satisfy this requirement, to remit the matter to the Tribunal to be heard and determined according to law, and to direct the Tribunal that in any rehearing its previous findings on all other issues stand.
In addition to Mr Wills’ s 44 appeal, SSG also initially appealed the whole of the Tribunal’s decision under s 44 of the AAT Act in proceeding QUD400/2020 (the SSG appeal). However, the SSG appeal was discontinued on 9 July 2021 by consent. This included Mr Wills’ consent, as the second respondent to the SSG appeal.
Following discontinuance of the SSG appeal, ASQA filed a notice of objection to the competency of Mr Wills’ appeal on 27 July 2021.
As elucidated in ASQA’s written submissions dated 20 July 2021 (RS), ASQA contended that Mr Wills’ appeal was incompetent on the following grounds:
(1)Mr Wills sought to appeal only from a finding of the Tribunal, being the finding that he failed to satisfy the requirement in criterion (i) of Sch 3 of the 2015 RTO Standards, when the finding was a step in the AAT’s reasoning to a decision whether to affirm, vary or set aside ASQA’s decision refusing renewal of SSG’s registrations. It was not a conclusion with the characteristics of a decision on a properly separable part of the matter before the AAT.
(2)Alternatively, Mr Wills’ s 44 appeal should be permanently stayed as an abuse of process given that:
(a)the SSG appeal was discontinued with Mr Wills’ consent;
(b)pursuant to r 33.31 of the Federal Court Rules 2011 (Cth), the notice of discontinuance has the effect of a court order dismissing the SSG appeal;
(c)the relief sought on the appeal, namely to set aside the Tribunal’s decision, is inconsistent with the effect of the court order dismissing the SSG appeal; and
(d)the appeal is prejudicial to the proper administration of justice.
As a result, Mr Wills sought leave to amend his appeal by an interlocutory application filed on 29 July 2021 attaching a draft amended notice of appeal. By the draft amended notice of appeal, Mr Wills sought to amend the notice of appeal so as to appeal from the whole of the Tribunal’s decision and to limit the substantive relief sought to setting aside the Tribunal’s decision. Subsequently, following observations in arguendo from the Bench at the start of the hearing, Mr Wills sought to rely upon a further amended notice of appeal in which he sought relief further and in the alternative in terms of a declaration that the Tribunal denied him procedural fairness. ASQA opposed the grant of leave to amend on discretionary grounds by reason of the alleged inconsistency between the relief now sought and the resolution by consent of the SSG appeal and related to this, on the ground of abuse of process. However, I am satisfied that there is no abuse of process (at least insofar as declaratory relief is sought as opposed to setting aside the Tribunal’s decision) and that it is in the interests of justice to grant leave to amend given the following considerations:
(1)Mr Wills was a party to the Tribunal proceeding and therefore had a right of appeal under s 44 of the AAT Act;
(2)as the Tribunal expressly recognised, he was joined for the reason that he had “a vital interest in these proceedings insofar as his reputation was at stake”;
(3)it was not in issue that a breach of procedural fairness would constitute an error of law for the purposes of s 44; and
(4)if adverse findings were made against him by the Tribunal in breach of procedural fairness, there are strong grounds for contending that it would be appropriate for the Court to grant declaratory relief in the terms sought in the exercise of its discretion.
3. LEGISLATIVE FRAMEWORK
The objects of the NVR Act are set out in s 2A which provides as follows:
(a) to provide for national consistency in the regulation of vocational education and training (VET); and
(b) to regulate VET using:
(i) a standards‑based quality framework; and
(ii) risk assessments, where appropriate; and
(c) to protect and enhance:
(i) quality, flexibility and innovation in VET; and
(ii) Australia’s reputation for VET nationally and internationally; and
(d) to provide a regulatory framework that encourages and promotes a VET system that is appropriate to meet Australia’s social and economic needs for a highly educated and skilled population; and
(e) to protect students undertaking, or proposing to undertake, Australian VET by ensuring the provision of quality VET; and
(f) to facilitate access to accurate information relating to the quality of VET.
Section 17 of the NVR Act confers power on ASQA to grant an application for registration as an RTO. Registration must be granted for a period set by ASQA which cannot exceed 7 years and may be subject to conditions imposed by ASQA (ss 17(5) and (6), NVR Act).
Section 31 in turn enables an RTO to apply for renewal of registration under s 17:
31Renewal of registration
(1)The National VET Regulator may renew an NVR registered training organisation’s registration under section 17 if the organisation makes an application for renewal:
(a)at least 90 days before the day the organisation’s registration expires; or
(b)within such shorter period as the Regulator allows.
…
(3)An NVR registered training organisation’s registration is taken to continue until the organisation’s application is decided.
…
In determining whether or not to grant registration, s 17(2) of the NVR Act lists certain considerations which ASQA, and the Tribunal standing in its shoes on review, “must” consider, namely:
(2)In deciding whether to grant an application, the National VET Regulator must consider whether the applicant complies with:
(a)the VET Quality Framework; and
(b)the applicable conditions of registration set out in Subdivision B of this Division.
Section 17(3) also provides that “[w]hen considering the application, the National VET Regulator may conduct an audit of any matter relating to the application.”
The 2015 RTO Standards were made under ss 185(1) and 186(1) of the NVR Act and comprise part of the VET Quality Framework as defined in s 3 of that Act. In furtherance of the express objects of the NVR Act, the stated purpose of the 2015 RTO Standards as at the relevant time was to:
1.set out the requirements that an organisation must meet in order to be an RTO;
2.ensure that training products delivered by RTOs meet the requirements of training packages or VET accredited courses, and have integrity for employment and further study; and
3.ensure RTOs operate ethically with due consideration of learners’ and enterprises’ needs.
Under the heading “Structure”, the 2015 RTO Standards explain that:
These Standards consist of eight Standards. Under each Standard is a set of Clauses of the Standard.
To comply with a Standard, the RTO must meet each of the Clauses. A person applying to register as a new RTO must demonstrate the capacity to meet these Standards for all of the person’s intended scope of registration.
For each Standard a context statement is also included. The context does not form part of the Standard itself, and has been included to provide background information to help readers understand the Standard.
(Emphasis added.)
Standard 7.1 is the relevant Standard in this case. The Standard and its accompanying contextual statement relevantly provided that:
Standard 7. The RTO has effective governance and administration arrangements in place
Context:
Business viability is critical to the ongoing sustainability of an RTO and the investment it makes in its services. If RTOs are not viable, then this negatively impacts on the quality of its training and assessment outcomes and on learners.
Operational and financial business standards therefore provide important protective measures for the learner and RTOs, as well as acting as a disincentive for underprepared organisations to enter the market.
The factors determining the viability of an RTO are dependent upon the business objectives and operating characteristics of the RTO. For example, the factors determining the business viability of an enterprise RTO embedded within a major Australian business may be different to those impacting upon a private provider or a [publicly]-owned TAFE Institute.
To be compliant with Standard 7 the RTO must meet the following:
7.1 The RTO ensures that its executive officers or high managerial agent:
a)are vested with sufficient authority to ensure the RTO complies with the RTO Standards at all times; and
b)meet each of the relevant criteria specified in the Fit and Proper Person Requirements in Schedule 3.
Additional requirements imposed by Standard 7 include satisfaction of the Financial Viability Risk Assessment Requirements and that the RTO holds public liability insurance covering the scope of its operations throughout its registration period.
In turn, the F&PP requirements in Sch 3 to the 2015 RTO Standards relevantly provide that:
Fit and Proper Person Requirements
Criteria for suitability
In assessing whether a person meets the Fit and Proper Person Requirements, the VET Regulator will have regard to the following considerations:
…
b)whether the person has ever been an executive officer or high managerial agent of an RTO at a time that the RTO had its registration on the National Register cancelled or suspended by its VET Regulator for having breached a condition imposed on its Registration;
…
h)whether the person has ever been determined not to be a fit and proper person as prescribed under any law of the Commonwealth or of a State or Territory of Australia, and if so, whether that determination remains in place;
i)whether the public is likely to have confidence in the person’s suitability to be involved in an organisation that provides, assesses or issues nationally recognised qualifications;
…
k)any other relevant matter.
(Emphasis added.)
No issue is taken on the appeal with the Tribunal’s construction of Standard 7.1 and Sch 3 of the 2015 RTO Standards. In this regard, as the Tribunal found at [104]–[105], Standard 7.1 imposes a mandatory obligation on the RTO to ensure that every executive officer or high managerial agent is compliant with each of the matters listed. In turn, the provisions of Sch 3 of the 2015 RTO Standards oblige ASQA to “have regard to” a number of considerations, some of which including, notably, criterion (i), require an evaluative assessment to be undertaken by the decision-maker. Furthermore, it is clear from criterion (k) that the decision-maker is not confined to the specific matters set out in Sch 3 in assessing whether the F&PP requirements are met. Those further matters which may be relevant would be informed by the stated purpose of the 2015 RTO Standards and the contextual statement introducing Standard 7.
Finally, the statutory definitions of “executive officer” and “high managerial agent” are found in s 3 of the NVR Act and Part 1 of the 2015 RTO Standards, and are relevantly identical. Specifically, s 3 of the NVR Act provides that:
executive officer in relation to a registered training organisation means:
a)a person, by whatever name called and whether or not a director of the organisation, who is concerned in or takes part in the management of the organisation; or
b)if the RTO is a body corporate:
i.A person who, at any time during the period for which the organisation is registered, owns 15% or more of the organisation; or
ii.a person who, at any time during a period for which the organisation is registered, is entitled to receive 15% or more of dividends paid by the organisation; or
…
high managerial agent means an employee or agent of the organisation with duties of such responsibility that his or her conduct may fairly be assumed to represent the organisation in relation to the business of providing courses.
4. THE FACTUAL CONTEXT AGAINST WHICH THE GROUNDS OF APPEAL FALL TO BE CONSIDERED
As the Tribunal noted, this matter has had a lengthy history. It is necessary to set out that history with some care, given that the issue of procedural fairness needs to be considered in all of the relevant circumstances: see further the discussion of applicable principles at [118] below.
4.1 The decisions by ASQA with respect to SSG and the related company, Productivity Partners Pty Ltd
On 18 April 2018, ASQA rejected SSG’s applications for renewal of registration and to change the scope of its registration as an RTO pursuant to s 33 of the NVR Act (the ASQA SSG decisions). While ASQA found SSG to be critically non-compliant with a number of standards specified in the 2015 RTO Standards, it is common ground that the ASQA SSG decisions did not rely on any non-compliance with Standard 7.1 or non-compliance with the F&PP requirements set out in Sch 3 of the 2015 RTO Standards.
For reasons which will become apparent, it is relevant that ASQA had earlier on 16 June 2017 notified Mr Wills of its decision to cancel the registration of a related company, PP, as an RTO, with effect from 21 July 2017. At the same time, ASQA cancelled PP’s RTO registration under ss 36(2)(f) and 39 of the NVR Act and its registration as a registered provider pursuant to s 83(3)(c) of the Education Services for Overseas Students Act 2000 (Cth) (ESOS Act) (together the ASQA PP decision) (Appeal Book (AB) Part C, tab 7).
PP was founded in 1998 and traded as Captain Cook College. As earlier mentioned, PP and SSG shared a common parent company, Site Group International Limited (SGI), which was listed on the Australian Stock Exchange (TR at [72]). SGI established SSG in 2011 and acquired PP in 2014. Mr Wills became a director of SGI on 12 October 2010 and chairman of the board from that date until his resignation in March 2019 as sole director and CEO of SSG. Mr Wills held approximately 15% of the shares in SGI and was one of three directors. Furthermore, on or about 28 February 2017 Mr Ian Cook, who was the serving CEO of PP, was replaced by Mr Wills who was also a director of PP.
The process leading to the ASQA PP decision was described in the statement of reasons which comprised part of ASQA’s Sanction Decision Record (the ASQA PP reasons) and in the Background set out in the same, namely:
(1)the ASQA inquiry into PP commenced in January 2016 and included the issue and execution of a warrant on 10 May 2016, interviews of 15 persons in the initial formal investigation process, the exercise of statutory powers to obtain data records involving student enrolments and progression, and contacting a sample of students (the ASQA PP inquiry);
(2)following analysis of information gathered during the ASQA PP inquiry, on 13 April 2017 ASQA issued a notice of its intention to cancel PP’s registration under the NVR Act and the ESOS Act;
(3)to support the notice, four reports were issued by ASQA and attached to the notice outlining the findings of the ASQA PP inquiry, including the identified instances of non-compliance as described at [60(4)] below;
(4)PP was afforded an opportunity to respond to the notice; and
(5)PP in fact responded to the notice on 22 May 2017 and provided limited evidence but, significantly, did not refute many of the findings made by ASQA.
With respect to the evidence provided by PP in response to the Notice, ASQA found in the ASQA PP reasons that:
The substance of the RTO’s reply relied on reports from two independent audit activities that the RTO had commissioned in 2015 and 2016.
•These commissioned audits, largely, assessed the RTO’s processes and procedures only and did not consider the actual practices performed by the RTO with particular consideration to the number of students the RTO enrolled.
•The scope of these audits was very limited and there is no evidence that student records or data of the RTO’s activities were considered.
•The audit reports do not, in any way, show that the RTO’s demonstrated behaviours and practices were compliant.
•Further, the audit report in 2015 found continuing non-compliance with the RTO’s obligations to determine student suitability and amount of training required – this is consistent with behaviour in relation to enrolling unsuitable students in order to maximise VET FEE-HELP revenues.
(Emphasis added.)
Importantly, the attachments to the ASQA PP decision record included the evidence analysis relating to the sanction evidence review. While Mr Wills complains that the ASQA PP reasons were pitched at a high level of generality, that complaint ignores the fact that the findings made in the ASQA PP reasons were based upon the evidence analysis contained in the four reports in respect of which Mr Wills (on behalf of PP) was afforded, and had taken advantage of, an opportunity to respond.
In the ASQA PP reasons, ASQA found that there remained evidence of specific and systemic non-compliance with the VET Quality Framework, including the Standards for NVR Registered Training Organisations 2012 (with respect to PP’s demonstrated practices before April 2015) and the 2015 RTO Standards (with respect to PP’s demonstrated practices from April 2015). Its findings based upon that evidence included that:
(1)there was widespread and systemic non-compliance with the marketing/recruitment and enrolment practices undertaken by PP and by third parties operating on its behalf;
(2)PP failed to monitor its third parties to ensure that marketing and advertising were ethical, accurate and factual;
(3)PP’s priority was to enrol as many students as possible into diploma-level qualifications through the VET FEE-HELP scheme, with little consideration given to the course in which the student was enrolled or to the student’s suitability to undertake the course;
(4)in the period from 1 January 2013 to September 2016, PP had 9,983 online enrolments of which 7,546 students completed zero units of competency despite being charged a total of $72,443,272.68 in VET FEE-HELP fees by PP, and only 165 were issued qualifications (or in PP’s contention, 240);
(5)7,518 of the 9,983 online enrolments occurred between 1 July to 31 December 2015, with only 36 students (or in PP’s contention, 59) enrolled in this period being issued with qualifications, and only 124 (or in PP’s contention, 198) completing a unit of competency and issuing a statement of attainment;
(6)PP was aware that the majority of its students lacked the underpinning capabilities to complete a diploma-level qualification and required further support which was not provided;
(7)PP lacked sufficient trainers and assessors or sufficient learning resources to deliver the qualifications to the number of students enrolled and provide the necessary support to them; and
(8)despite being aware of information suggesting widespread agent misconduct and misrepresentations, PP did little, if anything, to properly deal with the complaints.
ASQA further found that:
The extant misbehaviour and lack of remedial action of and by the RTO, and its third parties on its behalf, is apparently widespread, systemic, unethical and materially unanswered. This misbehaviour was or should have been within the knowledge of the RTO’s senior management and directors and they should have swiftly taken action to remedy it.
Having regard to the totality of the available information and in the context of the fit and proper person requirements contained at schedule 3 of the Standards for Registered Training Organisations (RTOs) 2015, particularly items i) and k) of the criteria for suitability, the RTO and its executive officers and high managerial agents are not fit and proper to be involved in or registered as an RTO. On this basis, the RTO is therefore also in breach of Clause 7.1 of the Standards and section 23 of the NVR Act.
(Emphasis added.)
As I shortly explain, the Tribunal essentially reached the same conclusion on a narrower basis, namely, that the statistics extracted from PP’s records which were not challenged by evidence established a disastrous and dysfunctional performance by PP about which Mr Wills, as a director of PP, knew or should have known and should have taken steps to address.
4.2 The application to the Tribunal for merits review of the ASQA PP decision
On 13 July 2017, PP applied to the Tribunal for review of the ASQA PP decision (the PP Tribunal proceeding) (TR at [95]). ASQA filed a Statement of Facts, Issues and Contentions (SFIC) in the PP Tribunal proceeding alleging that:
(1)PP engaged in deliberate conduct which was significantly in breach of the 2015 RTO Standards; and
(2)as a result of that conduct, Mr Wills (and others involved) are not persons in whose suitability to be involved in an RTO the public would have confidence and, as a consequence, PP was in breach of Standard 7.1 (by reference to Sch 3 criterion (i)) (the PP Suitability Contention).
While PP contested the PP Suitability Contention and the ASQA PP decision, it did not seek a stay of its operation.
However, on 21 December 2018 the PP Tribunal proceeding was stayed by the Tribunal pending the conclusion of proceedings in the Federal Court instituted by the Australian Competition and Consumer Commission (ACCC) against PP. In that proceeding, the ACCC alleged, among other things, that PP had engaged in unconscionable conduct contrary to s 21 of the Australian Consumer Law. That decision was reserved at the time of the Tribunal’s decision the subject of this appeal, with judgment being delivered subsequently on 2 July 2021: Australian Competition and Consumer Commission v Productivity Partners Pty Ltd (trading as Captain Cook College) (No 3) [2021] FCA 737.
4.3 The application to the Tribunal for review of the ASQA SSG decisions
4.3.1The grant of a stay of the ASQA SSG decisions
SSG applied to the Tribunal on 24 April 2018 for review of the ASQA SSG decisions and for a stay of both decisions (the SSG Tribunal proceeding).
On 21 May 2018, pursuant to s 41 of the AAT Act, the Tribunal granted SSG an unconditional stay of ASQA’s decision to not renew SSG’s registration pending determination of the application for review (AB Part A, tab 3).
4.3.2The Tribunal’s ruling permitting ASQA to raise the issue of compliance with Standard 7.1 and the challenge to that ruling in the Federal Court
On 17 January 2019, the Australian Government Solicitor (AGS), solicitors for ASQA, wrote to HopgoodGanim Lawyers, solicitors for SSG, advising that they were instructed to apply for an expedited hearing of SSG’s applications and for the Tribunal to be constituted by a Presidential Member given the complexity and number of legal issues in the matter (AB Part C, tab 11 at p. 209).
Importantly, AGS also gave notice that, in addition to other contentions, it intended to put in issue SSG’s fitness for registration as an RTO on the ground that SSG did not comply with Standard 7.1 of the 2015 RTO Standards because its CEO, Mr Wills, was the CEO of PP when its registration as an RTO was cancelled and was not a fit and proper person (the Suitability Contention). AGS attached a letter dated 26 April 2018 giving notice of this issue in the PP Tribunal proceeding and further explained that:
This step is necessary given certain issues also affecting this RTO [SSG] (noting both have the same parent company and there is some duplication in executive officers/high managerial agents) will not now be the subject of the Tribunal’s consideration in the Productivity Partners hearing in February 2019. Those issues require urgent consideration insofar as they also affect this RTO and consideration in the current context appears now unlikely to result in duplication from simultaneous consideration/determinations in multiple proceedings.
The letter further advised that, as compliance with Standard 7.1 would now be in issue in the SSG Tribunal proceeding, a range of material filed in the PP Tribunal proceeding was now relevant to the issues in the SSG Tribunal proceeding and ASQA would therefore shortly file these documents in accordance with its obligations under s 38AA of the AAT Act.
The letter also attached a draft application for directions in the SSG Tribunal proceeding which relevantly stated that:
7. The applicant is in ongoing breach of Standard 7.1 of the Standards for Registered Training Organisations (RTOs) 2015 (2015 Standards) because, by reason of Vernon Wills being an executive officer of Productivity Partners on 16 June 2017 when its registration on the National Register was cancelled, SSG is in breach of Standard 7.1 (see criteria (b) in Schedule 3). The applicant is required to ensure Vernon Wills meets each of the relevant criteria specified in the Fit and Proper Person Requirements in Schedule 3. It is undeniable that he does not meet the criteria. This is therefore an ongoing serious breach that has been extant in respect of SSG since 16 June 2017, and remains un-remedied. This alone, is sufficient reason to find that SSG should not be registered as an RTO.
(Emphasis in bold and italics added.)
On 13 March 2019, the Tribunal decided to permit ASQA to rely upon the Suitability Contention in the SSG Tribunal proceeding, granted ASQA’s expedition application, and set the matter down for expedited hearing between 13 and 24 May 2019. I interpolate that on 8 April 2019, SSG applied to the Federal Court for certiorari to quash this ruling under s 39B of the Judiciary Act 1903 (Cth). That application was summarily dismissed by Reeves J on 22 November 2019, who held that none of SSG’s grounds for challenging the Tribunal’s decision to permit ASQA to rely upon the Suitability Contention had any reasonable prospects of success: Site Skills Group Pty Ltd v Administrative Appeals Tribunal [2019] FCA 1970.
4.3.3ASQA’s first 7.1 SFIC (18 March 2019)
Returning to the chronology of events, on 18 March 2019 ASQA filed its initial Statement of Facts, Issues and Contentions: Standard 7.1 (ASQA’s first 7.1 SFIC) (AB Part C, tab 10). In the SFIC at [2], ASQA acknowledged that, in deciding to reject SSG’s application for renewal of its registration as an RTO, ASQA had not relied on any non-compliance with Standard 7.1 or non-compliance with the F&PP requirements set out in Sch 3 of the 2015 RTO Standards. However, ASQA explained that it had raised this issue in the PP Tribunal proceeding:
3. Prior to the making of the [ASQA SSG] decision[s], ASQA had made a decision to cancel the registration of another RTO, Productivity Partners Pty Ltd (PP) which is owned by the same company as SSG – Site Group International Ltd (Site) (PP Cancellation Decision). At the time of the cancellation of PP’s registration, Vernon Wills was its CEO. Mr Wills is currently SSG’s CEO. From June 2014 when Site acquired PP, Mr Wills had been a Director of PP and was involved in the management of the company. PP has challenged ASQA’s decision in the Tribunal (PP Proceedings).
4. In the PP proceedings ASQA has filed a statement of facts, issues and contentions alleging that PP engaged in deliberate conduct which was significantly in breach of the 2015 Standards. ASQA also contends that as a result of that conduct, Mr Wills (and others involved) are not persons in whose suitability to be involved in an RTO the public would have confidence and as a consequence PP was in breach of Standard 7.1 (by reference to Schedule 3 criteri[on] (i)) (Suitability Contentions). ASQA also notes that Mr Wills ceased to meet the criteria in Schedule 3 as a consequence of being an executive officer of PP at the time PP had its registration cancelled (criteria (b)).
5. PP contests the Suitability Contentions. It also contests the cancellation decision more generally but has not sought a stay of its operation[.]
6. It is now unlikely that the substantive question of whether Mr Wills is a person in whose suitability to be involved in an RTO the public would have confidence as a consequence of his conduct while a director of PP will be resolved in the PP Proceedings within the foreseeable future. Consequently, it is necessary for the Tribunal to consider the Suitability Contentions in these proceedings.
(Emphasis in bold and italics added.)
ASQA contended that “the Tribunal could not grant SSG registration unless it has first considered compliance with Standard 7.1” (emphasis in the original), and that historical, as well as current, compliance was relevant to determining whether registration should be granted (ASQA’s first 7.1 SFIC at [9]–[11]). In addition to non-compliance with a number of 2015 RTO Standards said to be demonstrated by ASQA’s audit and continued non-compliance identified in SSG’s expert evidence, Part II of ASQA’s first 7.1 SFIC at [19]–[29] set out detailed facts and contentions on which it relied to contend that:
16.1.SSG is in breach of Standard 7.1 of the 2015 Standards by failing to ensure that its executive officers or high managerial agents meet each of the relevant criteria specified in the Fit and Proper Person Requirements in Schedule 3;
16.2.In particular SSG failed to ensure that its CEO, Mr Wills was a person in whose suitability to be involved in an RTO the public is likely to have confidence;
16.3.By reason of Mr Wills’ conduct during the time of his involvement with PP, he is not a person in whose suitability the public is likely to have confidence.
In this regard, ASQA further explained in its first 7.1 SFIC that:
17.These contentions are in addition to the contentions which will be made in a separate SFIC dealing with other 2015 Standards and in addition to the contention that SSG is in breach of Standard 7.1 by reason of the fact that its CEO was CEO of PP when its registration was cancelled (Schedule 3 criteria (b)).
In short, in line with the letter in January 2019 from AGS, ASQA’s first 7.1 SFIC put Mr Wills (and SSG) on clear notice that ASQA, in the context of determining whether SSG was in breach of Standard 7.1 in the SSG Tribunal proceeding, raised the “substantive” question of whether Mr Wills met the F&PP requirements in circumstances where that question would not now be resolved in the PP Tribunal proceeding in the foreseeable future. Mr Wills (and SSG) was also on clear notice that the basis for that contention was, relevantly, Mr Wills’ involvement in the management of PP which ASQA alleged had been significantly in breach of the 2015 RTO Standards as found in its PP decision.
4.3.4ASX announcement of replacement of Mr Wills as CEO of SSG (26 March 2019)
On 26 March 2019, SGI issued an ASX announcement advising that the Mr Wills was being replaced as the CEO and sole director of SSG (AB Part C, tab 9).
4.3.5First tranche of the Tribunal hearing (15 to 24 May 2019)
The first tranche of the Tribunal hearing took place on 15 to 24 May 2019 and concerned all issues other than those the subject of SSG’s s 39B application to which I have referred at [47] above, namely, issues relating to the quality of education being delivered by SSG and ASQA’s application for revocation of the stay order made on 21 May 2018. This part of the hearing did not address the “fit and proper person” issues in accordance with the parties’ agreement because Mr Wills was involved in the proceedings before the Federal Court which arguably overlapped with the SSG Tribunal proceeding: TR at [6]. On 12 July 2019, the Tribunal handed down its decision declining to revoke the stay order or to impose conditions on that order: TR at [7].
4.3.6Joinder of Mr Wills and issues and contentions regarding Standard 7.1
Following the decision by Reeves J summarily dismissing SSG’s application for judicial review of the Tribunal’s decision permitting ASQA to rely upon the Suitability Contention, AGS wrote to the solicitors for SSG on 12 December 2019 proposing that the SSG Tribunal proceeding be listed for directions to final hearing (AB Part C, tab 15, JCM-1, pp. 323–4). In that letter, AGS asked for confirmation as to whether Mr Wills would be made available for cross-examination or “[a]lternatively, if ASQA’s contentions regarding Mr Wills will not be answered and will go unchallenged by Mr Wills, the matter only needs to be listed for closing submissions. In that event, ASQA will contend that the Tribunal ought to make all of the findings sought by ASQA in respect of the “suitability contention”” (emphasis added). SSG’s solicitors responded on 19 December 2019 advising that Mr Wills would be available for cross-examination (AB Part C, tab 15, JCM-1, pp. 325–6).
On 30 January 2020, Mr Wills’ application for leave to be joined as a party under s 30(1A) of the AAT Act (as an Other Party) was granted by the Tribunal (AB Part A, tab 4). Mr Wills duly lodged an SFIC on 9 March 2020 in relation to the Suitability Contention (the Wills first SFIC). In his first SFIC (AB Part C, tab 12), Mr Wills accepted that at the time of the ASQA PP decision, he was the CEO of PP and of SSG (Wills first SFIC at [4]). However, for reasons set out in the SFIC, Mr Wills contended at [13] that SSG had not failed to comply with Standard 7.1 on the basis of the Suitability Contention or otherwise. Of particular relevance, he contended that:
…
(b)Mr Wills is not a person whom, by reason of his conduct during the time of his involvement with PP, the public is likely not to have confidence is suitable to be involved in an organisation that provides, assesses or issues nationally recognised qualifications, and accordingly does not fail to satisfy criterion (i) of Schedule 3; and
(c)the consideration of whether Mr Wills is a Fit and Proper Person is a global assessment taking into account, as relevant, the matters prescribed under Schedule 3, and a failure to meet any one of the criteria specified in Schedule 3 (which is denied) would not in any event automatically result in Mr Wills failing to meet the Fit and Proper Person requirement.
Thus, after referring to the seriousness of making a finding that a person is not fit and proper to be involved in an RTO and the alleged need to apply the Briginshaw v Briginshaw (1938) 60 CLR 336 standard of proof, Mr Wills at [48]–[82] of his SFIC engaged in a detailed refutation of ASQA’s Suitability Contention. He contended that the Suitability Contention was incorrect and did not establish that he was a person in whom the public would lack confidence to be involved in an RTO.
It is, therefore, clear from the Wills first SFIC that at this point in the SSG Tribunal proceeding, Mr Wills intended to mount a substantive case establishing that he met the F&PP requirements. Consistently with this, on 28 April 2020 Mr Wills applied to the Tribunal for production of documents under s 37(2) of the AAT Act relevant to the Standard 7.1 issue. In this regard, I note that, by a decision given on 24 June 2020, the Tribunal found that the documents sought in specified categories may be relevant to the review of ASQA’s decision and directed that those documents be lodged with it, with the qualification that documents over which ASQA claimed privilege were to be placed in a sealed envelope and not made available until further order of the Tribunal: Site Skills Group Pty Ltd and Australian Skills Quality Authority [2020] AATA 1919.
Following the lodging of the Wills first SFIC, on 26 May 2020 ASQA filed an amended SFIC concerning Standard 7.1 (ASQA’s Amended 7.1 SFIC), which it is appropriate now to consider.
4.3.7ASQA’s Amended 7.1 SFIC dated 26 May 2020
In its Amended 7.1 SFIC dated 26 May 2020, ASQA explained its position by way of introduction:
2. At issue is whether the Tribunal can be satisfied that SSG has effective governance and administration arrangements in place as demonstrated by SSG’s past and current compliance with clause 7.1(b) of the [2015 RTO Standards] in respect of Mr Vernon Wills (Mr V Wills). The Tribunal has previously heard evidence as to SSG’s compliance/non-compliance with this standard as it applies to other executive officers or high managerial agents of SSG.
3. ASQA contends first, that SSG from at least July 2017 to March 2019 failed to ensure that Mr V Wills, as its sole director and CEO, complied with each of the relevant fit and proper person (FPP) criteria in Schedule 3, namely criterion (b), (h), (i) and (k). Secondly, SSG continues in non-compliance as, notwithstanding the replacement of Mr V Wills as sole director and CEO of SSG, Mr V Wills remains an executive officer as defined of SSG. Further and alternatively, SSG’s response to Mr V Wills’ demonstrated failure to meet each of the criteria in Schedule 3 is a further illustration of SSG’s, at best, ad hoc approach to remedying those specific examples of non-compliance put in issue by ASQA and its failure to comprehend and implement systemic processes sufficient to ensure SSG compliance with the Standards.
After summarising the legislative provisions, ASQA set out its factual contentions at [11]–[66] of its Amended 7.1 SFIC, cross-referenced to the evidence. These contentions included:
(1)Mr Wills’ executive roles, managerial and governance involvement, and interests in the parent company, SGI, and in PP following its acquisition by SGI, and the relationship between the companies;
(2)the contention that Mr Wills’ attention was regularly brought to matters of third-party compliance and referral agent practices, PP enrolment practices, and PP educational attainments (at [21]);
(3)the preparation of an initial report dated 6 October 2016 by Deloitte Touche Tohmatsu (Deloitte) for the Commonwealth Department of Education and Training (DET) to determine the validity and veracity of distance students enrolled at PP based on Deloitte’s analysis of PP’s Learning Management System (LMS) which had all course materials and assessments, and was the educational platform used by distance learning students (at [25]);
(4)the provision of notice to PP on 13 April 2017 by ASQA of its intention to cancel PP’s NVR and ESOS registrations (AB Part C, tab 11, pp. 119–21), with a description of the analysis and conclusions reached with respect to data and files from PP in the detailed monitoring reports provided to PP by ASQA which underpinned the notice, namely:
(a)the 6 January 2017 Compliance Monitoring Report: Student Sample which analysed a sample of student files for each of the calendar years 2013-2016 provided in response to a s 26 notice and documents on its enrolment processes provided by PP – the report found breaches of various standards and identified the ways in which each of the sample files demonstrated a deficiency in compliance with the 2015 RTO Standards (ASQA’s Amended 7.1 SFIC at [31]–[37]);
(b)the 8 March 2017 Compliance Monitoring Report: Clause 1.3 based on a comparison between the number of trainers and assessors at PP and the number of enrolled students – the report concluded that PP did not demonstrate that it had sufficient trainers to deliver the training and assessment and educational and support services to meet the needs of learners as required by Standard 1.3 of the 2015 RTO Standards (ASQA’s Amended 7.1 SFIC at [38]–[39]);
(c)the 16 March 2017 Compliance Monitoring Report: Telephone Sample and Complaints Management which, among other things, provided an overview of what PP’s enrolment data indicated, including the extraordinary discrepancy between enrolments and completion rates and analysed the performance of marketing/referral agencies engaged by PP between 1 July to 31 December 2015 – the report concluded that PP failed to implement adequate controls to prevent misbehaviour of its agents involving breaches of the NVR Act and the Higher Education Support Act 2003 (Cth) and failed to properly deal with information indicating widespread agent misconduct (at [40]–[45]); and
(d)the 27 March 2017 Compliance Monitoring Report: Cover Report (at [46]–[56]) which explained the background to ASQA’s inquiries, provided an analysis of information collated and reported in the earlier compliance monitoring reports, and stated a preliminary view as to PP’s non-compliance with the NVR Act in specified areas. The report concluded that:
Having regard to the totality of available information and in the context of the fit and proper person requirements ..(… particularly items i and k) of the criteria for suitability) the RTO and its executive officers and high managerial agents are not fit and proper to be involved in or registered as an RTO.
(Quoted in the ASQA Amended SFIC at [47].)
(5)the steps taken by ASQA, PP and Mr Wills following the provision of the Notice of Intent and extension of an opportunity to PP to respond before the cancellation decision was made (at [48]-[55]);
(6)the contention that “ASQA’s detailed ‘Evidence Analysis’ and assessment of the material provided in response including the initial Deloitte Report ASQA obtained from DET, is set out at ST146.” (at [56]);
(7)the cancellation decisions made by ASQA in relation to PP on 16 June 2017 and the particulars of non-compliance on the basis of which those decisions were made, and conclusions reached by ASQA (at [57]-[61]);
(8)the addendum provided by Deloitte to its Report of 6 October 2016 based on further information provided by PP and the summary of its findings as to the lack of student engagement with PP’s LMS (at [62]); and
(9)the facts on the basis of which it was alleged that Mr Wills remained an executive officer within the statutory definition of SSG, notwithstanding his replacement as sole director and CEO in March 2019 (at [64]–[66]).
ASQA then identified the broad issue addressed by its Amended SFIC at [67] as “whether SSG is in breach of, or has breached clause 7.1(b) of the Standards: see also WSFIC [14]”, with the particular questions arising being as follows:
(a) While it is common ground that Mr V Wills was an executive officer and, or high managerial agent of SSG at all relevant times until 26 March 2019, has Mr V Wills been an executive officer of SSG since 27 March 2019?
(b) Did Mr V Wills meet criteria b) from July 2017, when ASQA’s decision to cancel the registration of PP took effect? What steps, if any, did SSG take to ensure that Mr V Wills did meet this criteria?
(c) Did Mr V Wills meet criteria h) from July 2017 when ASQA’s determination that each of the executive officers and high managerial agents of PP were not fit and proper persons to be involved in an RTO took effect in July 2017? What steps, if any, did SSG take to ensure that Mr V Wills met this criteria?
(d) Can this Tribunal be satisfied that from July 2017, Mr V Wills met criteri[on] i) having regard to:
(i) ASQA’s determination that having regard to this criteria and Mr V Wills’ role as an executive officer and or high managerial agent of PP he was not a fit and proper person to be involved in an RTO;
(ii) Mr V Wills’ role as an executive officer and or high managerial agent of PP in circumstances where PP has been found to have breached the Standards in the manner set out in the ASQA decision of April 2017;
(iii) Mr V Wills’ role as sole director and CEO of SSG at the time of the ASQA audit and ASQA’s decision to cancel the registration of SSG due to serious non-compliances and the ongoing failure of SSG to remedy the specific non-compliances identified by both ASQA and Ms Duncan let alone the systematic failures to comply with the NVR Act as addressed in the first round of these proceedings;
(iv) Mr V Wills’ continuing role as an executive officer of SSG, his denial of any such position, and SSG’s continuing non-compliance and failure to implement systematic change sufficient to assure this Tribunal that SSG is currently in a position to be compliant;
(e) What steps, if any, did SSG take to ensure that from July 2017, Mr V Wills met criteri[on] i)?
(f) Are there any other relevant matters that support or reduce the import of the Tribunal’s findings on criteria b), h) and i)?
(Emphasis added; footnotes omitted.)
The terms in which issue (d) is expressed in this passage are important. They make it clear that ASQA considered the question to be whether the Tribunal could be satisfied that Mr Wills met criterion (i). There is no suggestion that the Tribunal should simply adopt the ASQA PP reasons without more.
ASQA further contended among other things in its Amended 7.1 SFIC that:
83.Following an inquiry into the operation of PP as set out above, ASQA determined that Mr V Wills was not a fit and proper person to be involved in an RTO and drew particular attention to criterion (i).
84.Notwithstanding unsubstantiated allegations of ASQA’s impartiality and discrimination against PP, the ASQA decision, in so far as it addressed the application of the FPP requirements to PP and, or any of PP[’s] executive officers or high managerial agents, was not subject to judicial review. It is a valid decision and it remains operative.
85.This Tribunal, having regard to ASQA’s notice of intention to cancel with accompanying briefs of evidence and of analysis to PP, PP’s response and ASQA’s reasoned findings, and its decision which continues to be operative, may be satisfied that, consistent with ASQA’s finding, Mr V Wills, at the time of that decision, was not a person in whom the public was likely to have the relevant confidence.
(Emphasis added; footnotes omitted.)
Despite, as I shortly explain, a different view being put forward in correspondence between Mr Wills’ solicitors and AGS, read in context the statement at [84] that the ASQA PP decision is valid and remains operative could not reasonably be read as a contention that the Tribunal should simply adopt the ASQA PP decision without more. To the contrary and in line with the terms in which issue (d) was expressed above, the reference at [85] to the contention that “[t]his Tribunal … may be satisfied” of the matters alleged “consistent with ASQA’s finding” makes it plain that ASQA accepted that the Tribunal needed to reach its own state of satisfaction. Furthermore, it was arguably relevant that the ASQA PP decision had not been overturned even though a merits review of that decision was pending (albeit subject to a temporary stay) in circumstances where ASQA sought to rely in the SSG Tribunal proceeding upon the soundness of its analysis and reasoning in the ASQA PP decision.
In its Amended 7.1 SFIC, ASQA further contended with respect to issue (d) that:
86. SSG has failed to demonstrate that at the time, and prior to 26 March 2019, it took any steps to ensure that its executive officer and high managerial agent was not similarly likely to be bereft of the necessary public confidence. While the SSG audit and findings did not include unethical practices of third[-]party referral agents, they did find critical non-compliances in the assessment of, and response to the needs of prospective learners, the individual learner’s support requirements, and the consistency between the course requirements and course delivery, and the continued failure to introduce and implement systematic reform in response to ASQA’s inquiries. The critical non-compliances were not limited to the adequate preparation of foundational documents, though that remained very poor after 7 years of operation. They extended to a serious failure to understand the minimum requirements of the Standards as they apply to all qualifications within the scope of SSG’[s] registration and how to systematically ensure adherence to the Standards.
87. Under Mr V Wills’ direction and management, SSG continued to operate whilst in serious non-compliance as found by SSG’s own expert witness briefed on his instructions. Rectifications were piecemeal and reactionary. SSG continued to eschew the implementation of systematic reform.
88. SSG’s response to the ASQA audit was as directed by SGI and, more particularly Mr V Wills as director of SGI and as sole director and CEO of SSG. Mr V Wills’ direction and management of SSG up until 26 March 2019 left SSG in serious non-compliance such that this Tribunal could not be satisfied that he was a person in whom the public was likely to have confidence in the management of the RTO. As with PP, Mr V Wills had not demonstrated workable understanding of the RTO’s responsibility to self-regulate and implement effective systems to ensure compliance. To the contrary, he authorised ASX reports making unsubstantiated criticisms of ASQA potentially corrosive of public confidence in the regulator and in the provision of VET generally.
89. SSG continues under the direction of SGI. SSG has failed to demonstrate any steps it has taken to ensure that Mr V Wills as an executive officer of SSG is a person in whom the public is likely to have the requisite confidence.
90. SSG’s inability to reach compliance by May 2020, according to its own expert evidence as referenced in ASQA’s submissions dated 26 May 2020 about the ‘education issues’, is itself evidence that the governance changes SSG purported to make in March 2019 have been ineffective in bringing SSG into compliance. This is likely because of the ongoing involvement in SSG’s management of Mr V Wills, who has now shown himself in respect of two separate RTOs to be unable to manage an RTO in compliance with the NVR Act.
(Emphasis added; footnotes omitted.)
In these passages, therefore, ASQA alleged that in common with, and in addition to, its contentions that the Tribunal should be satisfied that at the time of the ASQA PP decision Mr Wills did not satisfy the F&PP requirements relying upon the ASQA PP reasons, the Tribunal should be satisfied that Mr Wills’ direction and management of SSG before 26 March 2019 and his involvement thereafter were also such that the Tribunal could not be satisfied that he was a person in whom the public was likely to have confidence given SSG’s critical and continuing non-compliances. The evidence relied upon by ASQA included serious non-compliances found by SSG’s own expert witness, as well as Mr Wills’ unfounded public statements potentially undermining the regulator’s authority.
4.3.8Correspondence seeking clarification of ASQA’s contention at [85] of its Amended 7.1 SFIC
As I have foreshadowed, the lodging of ASQA’s Amended 7.1 SFIC precipitated a course of correspondence from Mr Wills’ legal representatives seeking clarification of ASQA’s contentions at [84] and [85] of its Amended 7.1 SFIC. It was Mr Wills’ understanding of ASQA’s position as “clarified” through that correspondence which was said to involve a departure by ASQA from its position set out in its first 7.1 SFIC and is relied upon by him in relation to the alleged breach of procedural fairness.
On 3 June 2020, the applicant’s solicitors wrote to AGS relevantly seeking clarification of ASQA’s contention at [85] of its Amended 7.1 SFIC in light of its contention at [84] that ASQA’s decision in relation to PP “remains operative”, stating that:
It is unclear from the above-mentioned paragraphs whether ASQA’s contention is:
1.that the fact of ASQA having made a determination in relation to PP (being a determination which has not yet been set aside) is sufficient to establish that Mr V Wills, at the time of that decision, was not a person in whom the public was likely to have the relevant confidence; or
2.that the Tribunal should make its own assessment of the underlying matters which formed the basis of ASQA’s determination in relation to PP and thereafter independently make its own assessment of whether our client satisfied criterion (i) of Schedule 3 to the 2015 Standards.
Would you please confirm as a matter of priority which of the above two contentions your client adopts. If it is the latter, then our client also requires your urgent particularisation of the underlying facts that ASQA contends supports its contention in paragraph [85]. It is not sufficient for your client to simply rely in an unparticularised manner on “ASQA’s notice of intention to cancel with accompanying briefs of evidence and of analysis to PP, PP’s response and ASQA’s reasoned findings” (at [85]).
(AB Part C, tab 15, JCM-8.)
On 5 June 2020, AGS replied by letter in the following terms:
2. We consider that ASQA’s contention at [85] of its Amended SFIC on Standard 7.1 dated 26 May 2020 (Amended 7.1 SFIC) is clear as stated, that is, that the Tribunal, having regard to the matters stated in the Amended 7.1 SFIC, may be satisfied that at the time of ASQA’s Productivity Partners decision, Mr V Wills failed to satisfy criteri[on] (i) of Schedule 3 to the Standards.
3. Further, we note that subject to your client’s response, ASQA contends that having regard to all of the matters listed in the Amended 7.1 SFIC will be sufficient to establish that at the time Mr V Wills failed to satisfy criteri[on] (i). We say ‘subject to your client’s response’ because at this time we do not know what that response will be and we do not seek to limit the Tribunal’s consideration of any matters relevant to any party’s case.
(AB Part C, Tab 15, JCM-9.)
It is clear therefore from this response that AGS was directing Mr Wills’ solicitors to ASQA’s Amended 7.1 SFIC and that ASQA maintained its position that it was for the Tribunal to decide whether it was satisfied that Mr Wills met criterion (i) at the time of the ASQA PP decision, as found in the ASQA PP reasons. Nor was there anything in that or subsequent correspondence indicating that ASQA was not pressing its additional contentions as to why the Tribunal should be satisfied that Mr Wills did not meet criterion (i): see at [65]–[66] above.
However, Mr Wills’ solicitors responded on 9 June 2020, reiterating their queries and stating that:
The further difficulty with your response is that it introduces a new layer of ambiguity. Paragraph 85 of the Amended 7.1 SFIC does not include the words “having regard to the matters stated in the Amended 7.1 SFIC”. Rather, it invites the Tribunal to have regard to other specific matters including, for example, “the notice of intention to cancel” and the “accompanying briefs of evidence and of analysis”. The Amended 7.1 SFIC makes reference to the notice of intention to cancel (at [29]) but says nothing as to its content or the relevance of that content to criterion (i). The SFIC makes no reference at all to the “accompanying briefs of evidence and of analysis” (apart from the reference at [85]).
If your client’s position is that it relies only on the facts specifically identified in the Amended 7.1 SFIC at [11]-[66] to establish the breach non-satisfaction of criterion (i), it should say so. If your client’s position is that there is some other fact or matter in the underlying material the subject of the PP decision that the Tribunal should consider, your client should identify it. Our client cannot be left to guess at the facts upon which ASQA relies to establish the very serious allegation it has made.
(AB Part B, tab 64, JCM-10; emphasis in the original.)
Mr Wills foreshadowed that in the absence of further clarity, he may seek further directions from the Tribunal.
In response, on 10 June 2020 AGS wrote that:
2. The contention at [85] of ASQA’s Amended 7.1 SFIC does not require the Tribunal to “make its own assessment of the underlying matters which form the basis of ASQA’s determination in relation to PP, and thereafter independently make its own assessment of whether [y]our client satisfied criterion (i) of Schedule 3 to the 2015 Standards.” We understand from your correspondence that no further particulars are required. Your client’s request for a directions hearing is both unnecessary and opposed.
3. ASQA has difficulty in understanding your more recent assertions that our correspondence of 5 June 2020 has introduced “a new layer of ambiguity”, seemingly on the basis that the Amended 7.1 SFIC says nothing as to the content of certain documents. ASQA makes the following observations which it says are clear on the face of the Amended 7.1 SFIC:
3.1The notice of intention is identified and footnoted at [29].
3.2The briefs of evidence and of analysis are identified and addressed in summary form at [30]-[47].
(AB Part C, tab 15, JCM-11.)
Mr Wills’ solicitors responded again on 12 June 2020 stating that:
Your further correspondence indicates that ASQA will not, in the SSG Tribunal proceeding, be inviting the Tribunal to make its own assessment of the factual matters that formed the basis of ASQA's decisions in relation to PP, in the context of inviting the Tribunal to make findings with respect to Standard 7.1 of the 2015 Standards. That is, we understand your correspondence to confirm that ASQA will only invite the Tribunal to reach a finding because ASQA has itself made a finding rather than because of any objective basis for ASQA’s finding.
That being the case, we do not see the reason for the inclusion of summaries of the Compliance Monitoring Report of 6 January 2017 (at [31]–[37]), the Compliance Monitoring Report of 8 March 2017 (at [38]–[39]), the Compliance Monitoring Report of 16 March 2017 (at [40]–[45]) and the Compliance Monitoring Report of 27 March 2017 (at [46]–[47]) in ASQA's Amended 7.1 SFIC. Similarly, the inclusion in the Amended 7.1 SFIC of the ‘particulars of the findings of non-compliance’ set out in ASQA's decision (at [59]–[60]) also appears superfluous in light of your statement that the Tribunal will not be required to make its own assessment of the underlying matters which formed the basis of ASQA's determination in relation to PP. It is also unclear why ASQA has filed a further 106 documents as Supplementary T Documents, largely relating to conduct underlying the decision in connection with PP. This appears to be inconsistent with the statement made in paragraph 2 of your letter of 10 June 2020, and makes it difficult for our client to understand the precise nature of the case being put.
Both our client and SSG are entitled to understand with clarity the way that ASQA puts its case to the Tribunal. ASQA’s case has changed substantially since the original SFIC was filed. This is evident from (at least) the service of an additional 106 documents not previously relied upon or referred to since mid-late May 2020 and the reliance by ASQA on two new sections of Schedule 3 to the 2015 Standards not previously alleged.
In the circumstances, we consider it appropriate to exercise our liberty to apply to the Tribunal for further directions. We will seek that the Tribunal direct ASQA to confirm in writing that its case in relation to the Standard 7.1 issues as relates to Mr Wills is limited to ASQA inviting the Tribunal to reach a finding that Mr Wills is not a fit and proper person and, as a result, SSG is in breach of the 2015 Standards solely because ASQA has made a finding about Mr Wills’ suitability rather than because of any objective basis for ASQA’s finding.
(AB Part C, tab 15, JCM-12; emphasis added.)
ASQA advised on 15 June 2020 that its position remained unchanged from its letter of 10 June 2020 and that it would not conduct its case by correspondence, referring Mr Wills’ solicitors to its Amended 7.1 SFIC (AB Part B, tab 64, JCM-13). It opposed the request for a directions hearing.
On 15 June 2020, Mr Wills’ solicitors wrote to the Tribunal regarding their issues with ASQA’s Amended 7.1 SFIC and requesting that the matter be listed for directions. Correspondence from AGS on 23 June 2020 assumed that Mr Wills would have three witnesses, being himself and two character witnesses, Mr James Elder and Mr William Wall, and confirmed that ASQA required all of the witnesses on which SSG and Mr Wills relied for cross-examination. Two witnesses were to be called for SSG.
In a letter to AGS dated 25 June 2020, the solicitors for Mr Wills advised that in circumstances where the Standard 7.1 issue formed no part of the decision under review, ASQA should open its case before SSG and Mr Wills and that, “[i]f Mr Wills elects to call evidence, that evidence should be called after ASQA has closed its case on the Standard 7.1 issue” (AB Part C, tab 15, JCM-17).
4.3.9The Further Wills SFIC
On 1 July 2020, Mr Wills lodged a further SFIC concerned with Standard 7.1 with annexures (AB Part C, tab 14) (the Further Wills SFIC). The Further Wills SFIC stated that it was lodged in response to ASQA’s Amended 7.1 SFIC and was cross-referenced to the First Wills SFIC. In the Further Wills SFIC, Mr Wills agreed with ASQA’s statement of issues (set out at [61] above) but contended that that agreement must be read in light of two matters, namely:
5. First, SSG’s compliance with Standard 7.1 – including Mr Wills[’] status as a fit and proper person – formed no part of the reasons for the decision under review. While it is open for ASQA to raise a new issue before the Tribunal, procedural fairness requires that any new issue be identified with precision: SZBEL v Minister for Immigration and Multicultural andIndigenous Affairs [2006] HCA 63; (2006) 228 CLR 152 at [34]-[35]. The generality of some of the issues identified by ASQA are to be understood in light of, and confined by, the contentions made in ASQA’s Amended 7.1 SFIC.
6. Secondly, and relatedly, in relation to the issue of compliance with criterion (i) (see subparagraph 3(d) above), Mr Wills by his solicitors sought clarification of ASQA’s contentions in a letter dated 3 June 2020. The letter asked – with specific reference to paragraph 85 of ASQA’s Amended 7.1 SFIC – whether ASQA’s contention was that the fact of ASQA having made a decision in relation to PP was sufficient to establish its contention or whether the Tribunal was required to make its own assessment of the underlying facts the subject of ASQA’s decision in relation to PP. After an exchange of correspondence, on 10 June 2020 ASQA through its solicitors stated:
The contention at [85] of ASQA’s Amended 7.1 SFIC does not require the Tribunal to make its own assessment of the underlying matters which formed the basis of ASQA’s determination in relation to PP, and thereafter independently make its own assessment of whether [y]our client satisfied criterion (i) of Schedule 3 to the 2015 Standards.
7. On the basis of this clarification, Mr Wills approaches the issue on the basis that, although he disagrees with aspects of ASQA’s findings in relation to PP, the underlying merits of those findings (as opposed to the fact of the findings having been made) is not an issue in the review.
(AB Part C, tab 14; emphasis added.)
On 2 July 2020, the solicitors for Mr Wills advised ASQA that Mr Wills would not be giving evidence on the basis of ASQA’s confirmation of the manner in which it proposed to conduct its case (AB Part C, tab 15, JCM-30). However, even on Mr Wills’ construction of ASQA’s position with respect to reliance on its PP decision, there remained ASQA’s case as to the further and additional reasons why Mr Wills was said not to satisfy the F&PP requirements. Yet the explanation given for why Mr Wills would not be giving evidence did not logically address those important aspects of ASQA’s case.
4.3.10The second tranche of the Tribunal hearing
The second and final tranche of the Tribunal hearing took place on 6 to 10 July 2020 and addressed the “fit and proper person” issue as well as a consideration of the “education issues” arising after the first hearing. In the interim since the first hearing in May 2019, further evidence on the “education issues” was filed by the parties and the Other Party. Specifically:
(1)SSG filed additional evidence including further expert reports auditing compliance with the 2015 RTO Standards;
(2)ASQA lodged additional evidence including the statement of Ms Jessica MacDonald, solicitor, which among other things annexed the correspondence between AGS and Mr Wills through his solicitors in which they sought clarification of [85] of ASQA’s Amended 7.1 SFIC, and all of the T and Supplementary T documents referred to in ASQA’s Amended 7.1 SFIC; and
(3)Mr Wills filed affidavits of Mr Wall and Mr Elder, providing character evidence, and Mr Mohammed Akbery.
(TR at [23]–[25].)
As I explain below, on the first day of this hearing the scope of the Standard 7.1 issue was the subject of oral submissions and ruled upon by the Deputy President in favour of the submissions by Ms Brennan QC for ASQA. The hearing expressly proceeded thereafter on that basis, with Mr Giles SC, counsel for Mr Wills, declining at that stage an invitation by the Deputy President for an adjournment if he had been taken by surprise.
4.3.11Oral submissions as to the scope of ASQA’s case and the ruling by the Tribunal on 6 July 2020
The position as advised in the letter of 2 July 2020 was repeated by Mr Giles SC (T, 6/07/20, 471.36-42 (AB Part C, tab 16)). Ms Brennan QC for ASQA explained in opening that, in response to Mr Wills’ question as to whether ASQA was trying the litigate the bulk of the issues in the PP Tribunal proceeding that was stayed, “the answer to that question is a clear no” (T, 6/07/20, 473.20-22 (AB Part C, tab 16)). However, she continued:
What ASQA has said in paragraph 85 of its SFIC is not that ASQA made a decision therefore this Tribunal is to find. What ASQA has said is, if you look at all the circumstances of the case as we have set out in our SFIC, which deal with Mr Vern[on] Wills’s involvement and role in PP, and you look at the matters that were investigated by ASQA, the way they investigated it, their findings, what they put to PP, the opportunities PP had to respond, and the nature of PP’s response, and then [its] decision, then any reasonable member of the public – looking at those matters, and seeing what ASQA has done, and the conclusions that ASQA came to – would also be of the view that Mr Wills is not a fit and proper person by virtue of criterion [i].
So at no stage have we said, and this needs to be clear, at no stage have we said that this Tribunal is restrained from examining for itself the facts leading to, and underlying, ASQA’s finding as it pertains to Mr Wills. And rightly, the other party doesn’t, I don’t think, suggest that we did. I just want to make it clear that that’s the basis upon which this matter is proceeding, and the decisions in respect of the running of the cases, have been made.
So it really is a matter for the other party as to how they wish to run their case, and whether they agree or disagree with the case put by ASQA.
(T, 6/07/20, 473.24-43 (AB Part C, tab 16); emphasis added.)
In response, Mr McLeod for SSG submitted that this was “a[n] impossible halfway house in which ASQA is taking a position that it is not seeking to have you determine anything about the conduct of Productivity Partners, and whether or not the decision to cancel its registration, or ultimately to be found to be correct of course, that being the subject matter of the stay [of the] Productivity Partners proceedings.” (T, 6/07/20, 474.5-11 (AB Part C, tab 16)).
Ms Brennan QC then explained that:
ASQA has said the [T]ribunal, having regard to all the background facts coming into the making of the decision which continues to be operative as yet another element may be satisfied. The [T]ribunal may itself be satisfied that consistent with that finding, Mr Wills at the time of that decision was not a person in whom the public was likely to have the relevant confidence. So all ASQA is doing there is saying we’ve looked at this matter. We’ve looked at this matter in PP and this is how we looked at it, this is how we reasoned our conclusion and this is the conclusion we made, and we stand by it. We’re not second-guessing it. But the other party can. The other party can challenge it. SSG could challenge it. They chose not to.
In the correspondence we made it very clear that ASQA was not limiting the role of the Tribunal. This isn’t a case where we’ve come to the [T]ribunal and said like for example in the Gungor case, use a conviction, don’t go behind it, don’t look at anything, just take it. We haven’t done that. We have said here’s the decision but we’ve said but you’d better look at the facts in the circumstances and the reasoning of this decision, and the Tribunal like the public will be satisfied that at that time Mr Vernon Wills was not fit and proper. That’s 2017 and then were going to say and from then on he hasn’t exculpated himself in any way. A lot of those matters of course were dealt with in the first stage of the hearing. So that’s ASQA’s case.
(T, 6/07/20, 479.45-480.19 (AB Part C, tab 16); emphasis added.)
At that point, the Deputy President asked whether there was anything of surprise there to Mr Giles SC, who submitted that there was and there were a number of difficulties, and took the Deputy President to some of the correspondence summarised above in Section [4.3.6]. Mr Giles SC submitted that there were only two alternatives:
… one either has and we understand that we are meeting ASQA has made a decision and we’ve got various answers to that.
Alternatively, one could seek to prove ASQA could have put forward a case that said in effect Productivity Partners behaved extremely badly. They could go and try and seek to prove that it did so behave, would have been required to give us proper particulars as to that which we were meeting. … We would have understood that case but that’s not what is expressly described. What we do not understand can be run is something in between those two where it is said ASQA’s made a decision and it is going to have a particular weight without proving the underlying facts, contraventions et cetera, but because it’s apparently rationally reasoned then one should take it. That’s exactly what one is not permitted to do, and we have not understood and we sought to clarify to make sure that we were right about this and we did receive that clarification, that we’re not here fighting a fight about Productivity Partners.
(T, 6/07/20, 482.13-30 (AB Part C, tab 16).)
There was a footnote to the word “rorted” at [156] which read:
A word appearing in the Oxford English Dictionary and being described as chiefly used in Australian politics meaning to engage in fraudulent or dishonest manipulation of a system.
The Tribunal then posed the question:
160. Is the public likely to have confidence in Mr Wills’ suitability to be involved in the applicant organisation? This calls for the application of the common sense of the reasonable man. For this purpose and in this particular case I put aside the issue of the standard of education that the applicant provides or that PP provided.
The Tribunal concluded on the F&PP issue and compliance with Standard 7.1 that:
161. In relation to Mr Wills, I find that:
(a)He was a high managerial agent of PP. By definition, such a person is an employee or agent of the organisation with duties of such responsibility that his or her conduct may fairly be assumed to represent the organisation in relation to the business of providing courses.
(b)He was a director of PP.
(c)The performance of PP was such that large sums of money were paid to it, a minimal number of students completed courses; about half the students did not even [log in] to a course for which they were enrolled and most of this happened when the concerns about the VET Fee help system were well-known to Mr Wills.
(d)To express the concerns to which I have referred was inadequate. The abuse of the VET fee help system was obvious and on a grand scale. He should have stopped it promptly. Whatever steps were taken were inadequate.
162.I am satisfied that, applying the Briginshaw standard, the public is not likely to have confidence in Mr Wills’ suitability to be involved in an organisation that provides, assesses or issues nationally recognised qualifications. I am satisfied that the applicant does not satisfy the fit and proper person requirements in Schedule 3 of the Standards and does not adequately comply with Standard 7.1.
163.Evidence has been provided from Mr Elder and Mr Wall attesting to Mr Wills[’] good character, his business skills and his work in the field of vocational education. I have considered that evidence but it does not dissuade me from my conclusions.
(Footnotes omitted.)
For these reasons, the Tribunal affirmed ASQA’s decisions under review (TR at [166]).
5. DISPOSITION OF THE SECTION 44 APPEAL
5.1 Did the Tribunal act in breach of procedural fairness (Ground 1)?
5.1.1Relevant principles
The relevant principles are well settled.
First, it is trite to say that the Tribunal is bound by the rules of procedural fairness: see by analogy VAAD v Minister for Immigration and Multicultural and Indigenous Affairs [2005] FCAFC 117 (VAAD) at [38] (the Court) and the authorities referred to therein.
Secondly, Mr Wills bears the onus of establishing the factual foundation for a breach of procedural fairness (eg VAAD at [44]–[45] (the Court)).
Thirdly, as McHugh J observed in Re Refugee Review Tribunal; Ex parte Aala [2000] HCA 57; (2000) 204 CLR 82 (Ex parte Aala), in order to comply with the requirements of procedural fairness:
101. … a decision-maker should not make an adverse finding relevant to a person’s rights, interests or legitimate expectations unless the decision-maker has warned that person of the risk of that finding being made or unless that risk necessarily inheres in the issues to be decided. It is a corollary of the warning rule that a person who might be affected by the finding should also be given the opportunity to adduce evidence or make submissions rebutting the potential adverse finding.
(Footnotes omitted.)
See also Ex parte Aala at [78] (Gaudron and Gummow JJ).
Fourthly, as the Full Court held in Commissioner for Australian Capital Territory Revenue v Alphaone Pty Ltd (1994) 49 FCR 576 (Alphaone) at 590–1, compliance with this obligation “would ordinarily require the party affected to be given the opportunity of ascertaining the relevant issues and to be informed of the nature and content of adverse material” (approved in SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs [2006] HCA 63; (2006) 228 CLR 152 (SZBEL) at [32] (the Court)). Conversely, the Full Court in Alphaone pointed out that “[w]ithin the bounds of rationality a decision-maker is generally not obliged to invite comment on the evaluation of the subject’s case”: at 591.
Fifthly, the precise content to be given to the obligation to accord procedural fairness and the question of whether it has been breached will depend upon the facts and circumstances of the particular case, including the relevant statutory framework, as opposed to a priori classifications: SZBEL at [26] (the Court). Thus, as Brennan J observed in Kioa v West (1985) 159 CLR 550 at 611–2:
It is not possible precisely and exhaustively to state what the repository of a statutory power must always do to satisfy a condition that the principles of natural justice be observed.
…
The principles of natural justice have a flexible quality which, chameleon-like, evokes a different response from the repository of a statutory power according to the circumstances in which the repository is to exercise the power.
In the sixth place, and as an aspect of the last point, the Tribunal is required to put a party on notice of critical issues on review in circumstances where (as in the present case with respect to Standard 7.1) the issues were not considered dispositive by the primary decision-maker: see by analogy SZBEL at [35] (the Court); see also Alphaone at 591 (the Court).
Finally, compliance with these requirements requires the provision only of a reasonable opportunity to deal with matters adverse to the person’s interests that the decision-maker proposes to take into account: eg Muin v Refugee Review Tribunal [2002] HCA 30; (2002) 76 ALJR 966 at [123] (McHugh J); and Minister for Immigration and Multicultural Affairs v Bhardwaj [2002] HCA 11; (2002) 209 CLR 597 at [40] (Gaudron and Gummow JJ).
5.1.2No breach of procedural fairness has been established
Ground 1 of the further amended notice of appeal alleges a breach of procedural fairness by the Tribunal. I deal with each of the considerations relied upon in support of the alleged breach of procedural fairness as particularised in the further amended notice of appeal and elucidated in the submissions for Mr Wills, and have reached the view that neither individually nor cumulatively do they establish a breach of procedural fairness.
First, by virtue of s 17(2) of the NVR Act, it was a requirement for ASQA and the Tribunal on review to consider whether SSG complied with the VET Quality Framework before it could grant SSG’s application for registration, which included Standard 7.1 requiring the RTO to ensure that its executive officers or high managerial agents meet each of the F&PP requirements. ASQA maintained consistently since January 2019 and ASQA’s first 7.1 SFIC that the Tribunal could not be satisfied that SSG had complied with Standard 7.1 given Mr Wills’ involvement as an executive officer in PP which demonstrated that he was not a person in whose suitability the public was likely to have confidence.
Secondly, it was these allegations which led to Mr Wills personally being joined at his request to the SSG Tribunal proceeding, in order to afford him the opportunity to defend his reputation against these allegations. As the Tribunal found at [144], “[h]e is a man who had a vital interest in these proceedings insofar as his reputation was at stake.” The point therefore, in his being joined was, as the Tribunal also found, “to enable him to be heard on the fit and proper person issue in relation to his conduct in PP and in the applicant” (TR at [145]). In other words, it was properly understood that adverse findings of the nature sought by ASQA in its first 7.1 SFIC with respect to Mr Wills’ conduct should not be made without affording Mr Wills the opportunity personally to give evidence and make submissions in response. This is in fact what Mr Wills indicated he would do in his first SFIC where he set out his facts and contentions in response, alleging that he did in fact meet the F&PP requirements (see at [55]–[57] above).
Thirdly, Mr Wills contended on the appeal that the Tribunal failed to ensure that he had fair notice of ASQA’s case by reason of the lack of particularity of allegations against him in ASQA’s Amended 7.1 SFIC, the position taken by ASQA in response to requests for clarification, and the subsequent adoption by ASQA at the second tranche of the hearing of an “incoherent ‘half-way house’” to the following effect:
ASQA has eschewed, in writing and orally, any need for the Tribunal to conduct a full review of all the underlying facts to determine whether its decision in relation to PP was the correct or preferable decision. Nor, however, has it relied solely upon the fact of its decision. Rather, it contends that certain matters – including ASQA’s investigation, and PP’s response, and ASQA’s reasoning process – could justify a conclusion that Mr Wills does not meet the fit and proper person requirements. …
(Wills CS at [69].)
This construction of ASQA’s position at various times in the SSG Tribunal proceeding underpins the second matter on which Mr Wills relies, namely, that contrary to ASQA’s position as clarified in correspondence and at the Tribunal hearing, the Tribunal in fact undertook a review of the underlying facts in determining that he did not meet the F&PP requirements. In so doing, Mr Wills alleges that the Tribunal failed to afford him fair notice of the specific facts and circumstances which might cause that body to conclude that he did not meet the F&PP requirements as a result of which he was deprived of a fair opportunity to decide whether or not to give evidence and to make submissions against such a finding.
These submissions must be rejected. As a starting point, the critical passages of ASQA’s Amended 7.1 SFIC which led to the requests for clarification by Mr Wills’ solicitors bear repeating:
84.Notwithstanding unsubstantiated allegations of ASQA’s impartiality and discrimination against PP, the ASQA decision, in so far as it addressed the application of the FPP requirements to PP and, or any of PP[’s] executive officers or high managerial agents, was not subject to judicial review. It is a valid decision and it remains operative.
85.This Tribunal, having regard to ASQA’s notice of intention to cancel with accompanying briefs of evidence and of analysis to PP, PP’s response and ASQA’s reasoned findings, and its decision which continues to be operative, may be satisfied that, consistent with ASQA’s finding, Mr V Wills, at the time of that decision, was not a person in whom the public was likely to have the relevant confidence.
(Emphasis added.)
The correspondence from Mr Wills’ legal representatives focused upon the contention at [84] that the ASQA PP decision “remains operative” and, based on that, sought to confine ASQA to one of two possible constructions on the erroneous assumption that one or the other must be correct; that is, either:
(1)ASQA relied upon the existence of its operative PP decision as sufficient to establish that at the time of that decision, Mr Wills could not satisfy the F&PP requirements; or
(2)the Tribunal should revisit all of the underlying matters and form its own assessment.
(See eg the letter dated 3 June 2020 from Mr Wills’ solicitors quoted at [68] above.)
However, it is apparent from ASQA’s Amended 7.1 SFIC, that neither alternative represented ASQA’s position. The letter posed, in other words, a false dichotomy. To the contrary, in its Amended 7.1 SFIC, ASQA’s primary case was plainly that:
(1)the relevant issue was whether “this Tribunal [can] be satisfied that from July 2017, Mr V Wills met criteri[on] i)”, ie, that it was for the Tribunal independently to reach the requisite state of satisfaction with respect to criterion (i);
(2)in line with this, paragraph [85] of ASQA’s Amended 7.1 SFIC alleged that the Tribunal may be satisfied, “consistent with ASQA’s finding”, that Mr Wills was not a person in whom the public was likely to have the relevant confidence at the time of the ASQA PP decision; and
(3)the Tribunal should be satisfied that Mr Wills did not meet that criterion:
(a)at the date of the ASQA PP decision:
(i)for the reasons given by ASQA in its PP decision including the analysis in the underlying audit reports which were set out in detail in ASQA’s Amended 7.1 SFIC and fully cross-referenced to the evidence, as explained above; and
(ii)having regard to the failure by PP (and therefore Mr Wills as CEO and a director) to challenge that analysis despite having the opportunity to do so in the context of the ASQA PP inquiry, which was again the subject of explicit factual contentions in ASQA’s Amended 7.1 SFIC;
(b)nor did he meet that criterion subsequently, given among other things the report addendum dated 11 August 2017 prepared by Deloitte for the DET with respect to PP, Mr Wills’ role with SSG, and SSG’s continuing non-compliance and failure to implement systemic change.
As such, ASQA’s proposition was ultimately a simple one. With respect to Mr Wills’ failure to meet the criterion as at the time of the ASQA PP decision, ASQA did not seek to “reinvent the wheel” but relied upon the matters which it identified at [85] of the Amended 7.1 SFIC. In this regard, PP’s failure in the course of the ASQA PP decision-making process, save in very limited respects, to challenge the evidence and analysis underlying ASQA’s notice of intention to cancel PP’s registration was, given Mr Wills’ executive roles within PP as well as SSG, plainly relevant. Specifically, it was a matter which could, in the absence of any evidential challenge in the SSG Tribunal proceeding to the ASQA PP decision or underlying material, logically form a basis on which the Tribunal might infer that neither ASQA’s findings nor the underlying analysis were capable of being answered otherwise than by bare assertion. Further or alternatively, absent such a challenge, it might logically form a basis on which the Tribunal could derive greater comfort in reaching the same view as that reached by ASQA in light of the Tribunal’s own assessment of such underlying material as it considered relevant.
It follows, with respect, that Mr Wills’ contentions to the contrary in the correspondence took certain statements in [84]–[85] out of context. Not surprisingly, therefore, in subsequent correspondence ASQA asserted its continued reliance upon all of the matters listed in its Amended 7.1 SFIC. To do so did not invite uncertainty or introduce confusion, but directed Mr Wills’ attention back to its carefully defined facts, issues and contentions in its Amended 7.1 SFIC and from there, to the cross-references to the evidence filed in support of its contentions. Subject to only one caveat, with respect, it beggars belief that Mr Wills had any confusion about the case which ASQA sought to make and on which he had been on notice in the SSG Tribunal proceeding since the letter from AGS on 17 January 2019.
The caveat is that the letter from AGS on 10 June 2020 was arguably ambiguous in so far as it stated that “[t]he contention at [85] of ASQA’s Amended 7.1 SFIC does not require the Tribunal to “make its own assessment of the underlying matters which form the basis of ASQA’s determination in relation to PP, and thereafter independently make its own assessment of whether [y]our client satisfied criterion (i) of Schedule 3 to the 2015 Standards”.” Certainly, Mr Wills’ legal advisers responded on their understanding that AGS’s letter “confirm[ed] that ASQA will only invite the Tribunal to reach a finding because ASQA has itself made a finding rather than because of any objective basis for ASQA’s finding” (see at [74] above).
The short point, however, is that any possible confusion about whether ASQA’s contentions had fundamentally changed since Mr Wills was joined to the SSG Tribunal proceeding was put beyond doubt by Ms Brennan QC in the passages from the transcript set out at [84], [87] and [88] above on day one of the second tranche of the Tribunal hearing. In unequivocal terms, Ms Brennan QC explained how ASQA sought to rely upon the ASQA PP decision and that, while ASQA was not “second-guessing” its reasoning, it was perfectly open to SSG or Mr Wills to challenge its reasoning if they disagreed with it. That position accorded with the case contained in ASQA’s Amended 7.1 SFIC, properly understood, for the reasons I have earlier explained. Furthermore, the Tribunal then ruled upon the issue, expressly accepting Ms Brennan QC’s submission as to the nature of ASQA’s case and, despite the Tribunal’s invitation for an adjournment to consider his position as a result, Mr Giles SC stated that he did not require any adjournment (see at [89] above).
The fact that Mr Wills (and SSG) continued to press a construction of SSG’s case in closing submissions as a confusing “half-way house” and may have made forensic decisions on the assumption that that construction would be ultimately accepted by the Tribunal, cannot alter the facts that:
(1)as a result of the argument at the commencement of the first day of the second tranche of the hearing, Mr Wills (and SSG) were on clear notice as to the nature of ASQA’s case;
(2)the Tribunal ruled at that point that the matter would proceed on the basis that that was ASQA’s case; and
(3)Mr Wills (and SSG) had ample opportunity to meet that case notwithstanding any earlier confusion, given the invitation to have an adjournment to reconsider their position if they so wished.
Nothing more was required to be done as a matter of procedural fairness. As Kirby J stated in Allesch v Maunz [2000] HCA 40; (2000) 203 CLR 172 at [38]:
Sometimes, through stubbornness, confusion, misunderstanding, fear or other emotions, a party may not take advantage of the opportunity to be heard, although such opportunity is provided. Affording the opportunity is all that the law and principle require.
(Emphasis added.)
That being so, it also follows that there was no breach of procedural fairness in the Tribunal assessing material underlying the ASQA PP decision in order to satisfy itself as to whether Mr Wills met the F&PP requirements as a step in its reasons for concluding that SSG had not complied with Standard 7.1.
Fourthly, Mr Wills challenges the Tribunal’s rejection of his contention that ASQA had failed to particularise a specific fact that he performed in PP simply on the basis that “the material which is voluminous fully apprise[d] him of the conduct of PP during his time as a director and high managerial agent” (TR at [99]). The submission is, with respect, untenable. While the material was voluminous, ASQA’s Amended 7.1 SFIC set out in detail the basis on which it contended that Mr Wills’ involvement in PP was, given its disastrous performance, such as to render him a person in whom the public could not have the relevant confidence and was cross-referenced to the specific evidence relied upon, as I have earlier explained. Nor can it be said that the issues were defined at too great a level of generality. In this regard, the following additional matters should be addressed:
(1)The contention at AS [19] that ASQA’s Amended 7.1 SFIC failed to give notice of the conduct of PP which was alleged by focusing wrongly instead on the ASQA PP inquiry relies upon reading paragraph [84] of the SFIC out of context for the reasons I have already given. The conduct of PP upon which ASQA relied was the subject of detailed reasons and analysis in the ASQA PP decision and the underlying reports, all of which were summarised in the Amended 7.1 SFIC, and in the other factual contentions set out in ASQA’s Amended 7.1 SFIC: see at [60] above.
(2)Nor is there any merit in the proposition that “nowhere did the Amended SFIC identify what it was about Mr Wills’ conduct in relation to PP … that was said to have the consequence that he did not meet the “Fit and Proper Person” criteria” (AS at [20]). To the contrary, ASQA’s case focused upon Mr Wills’ role as an executive officer and/or high managerial agent of PP in circumstances where ASQA contended that PP had breached the 2015 RTO Standards “in the manner set out in” the ASQA PP decision (Amended 7.1 SFIC at [67(d)(i) and (ii)]), namely: that PP’s lack of compliance and remedial action, and that of third parties on its behalf, “[was] apparently widespread, systemic, unethical and materially unanswered [and] was or should have been within the knowledge of the RTO’s senior management and directors and they should have swiftly taken action to remedy it”.
Fifthly, Mr Wills further contends that:
… the error in the Tribunal’s approach is also manifested in its approach of having regard to “whether or not a matter was challenged by Mr Wills or [SSG] at the time” of the decision in respect of PP: J[140], see also J[99] … Even at the most abstract level there is an obvious problem with this conclusion. Why would either Mr Wills or SSG make a submission or seek to challenge a decision which related to PP? PP did challenge the decision by seeking review of the decision in the Tribunal and that challenge remains pending.
(AS at [21].)
However, at [99], the Tribunal made the different point that Mr Wills “was given an opportunity to respond on behalf of PP to ASQA when it proposed to cancel PP’s registration” (emphasis added) – a contention that was undeniably correct. As to the Tribunal’s reasons at [140] (quoted at [106] above), Mr Wills rightly points to the illogicality of suggesting that weight might be given to whether or not a matter giving rise to the ASQA PP decision was challenged by SSG or Mr Wills. However, it is by no means clear that this was what the Tribunal was suggesting at [140]. Its statement is very unclear. In any event, there is no such illogicality in suggesting that weight might be given to whether such a matter was challenged by PP or Mr Wills given that he was a director of PP at the time, and ultimately, it was this, together with the failure by Mr Wills and SSG in the SSG Tribunal proceeding to challenge the statistical evidence with respect to PP, to which the Tribunal attached weight.
Furthermore, Mr Wills’ submission at AS [22] that neither PP nor Mr Wills was given a proper opportunity to comment on Mr Wills’ fitness to be an executive officer of an RTO in the course of the PP investigation lacks specificity and cannot be sustained. It ignores the terms of the notice itself (at AB Part C, tab 11, pp. 119–21) which explained, under the heading “Reasons for the intended decision”, that ASQA intended to make the decision to cancel PP’s registrations under the NVR Act and the ESOS Act because of the findings, including instances of non-compliance, in the four attached reports. Furthermore, the 27 March 2017 Compliance Monitoring Report: Cover Report specifically found that PP and its executive officers and high managerial agents were not fit and proper to be involved in or registered as an RTO citing in particular criteria i) and k): cf AS at [23]. As earlier explained, the notice then invited PP to respond, which PP in fact took advantage of.
In the sixth place, the unfairness of the Tribunal’s approach was said to have been compounded by the following matters:
(1)the finding by the Tribunal that PP engaged in a fraudulent and dishonest manipulation of the system for public funding of vocational education of which Mr Wills had actual or constructive knowledge in circumstances where ASQA’s contentions had never been framed by reference to an allegation of fraud and Mr Wills was not otherwise on notice that such a finding might be made (referring to TR at [156]–[157]); and
(2)the Tribunal’s failure to engage with Mr Wills’ substantial, clearly articulated submission relying on contemporary audits of PP (quoting from the Newbery report summarised at [103] above), which instead “sidestepped any analysis of this evidence, by stating “these are reports that involve value judgements” as opposed to the “purely statistical” material upon which it did place weight” (quoting from TR at [141]–[142]).
However, the first of these contentions is based on a misreading of the Tribunal’s reasons. In this regard, it is well established that the reasons of an administrative decision-maker “are not to be construed minutely and finely with an eye keenly attuned to the perception of error”: Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259 at 271–2 (Brennan CJ, Toohey, McHugh and Gummow JJ (quoting with approval Collector of Customs v Pozzolanic Enterprises Pty Ltd (1993) 43 FCR 280 at 287)). When, therefore, it is said that such reasons should be read beneficially, ultimately this means that “a commonsense and realistic approach should be taken to understanding the reasons as a whole to see what it was that the Tribunal was saying”: Fang Wang v Minister for Immigration and Multicultural and Indigenous Affairs [2003] FCA 1044 at [14]–[15] (Allsop J (as his Honour then was)).
The Tribunal’s finding that the VET FEE-HELP system was “rorted” in the sense explained in the accompanying footnote needs to be understood in context. At [154], the Tribunal refers to “the work of dishonest agents” which had been uncovered by the Senate Inquiry, the establishment of which, together with related adverse publicity, should, in the Tribunal’s view, have led PP to put its house in order. However, despite finding that PP may have been benefiting from the work of dishonest agents (TR at [154]), the Tribunal did not find that PP itself was dishonest. Rather, it found at [156] that PP was “at best … totally dysfunctional”. That is a far cry from a finding of dishonesty or fraud. Nor did the Tribunal make any finding of dishonesty or fraud against Mr Wills. Rather, bearing in mind that fraud and dishonesty cannot be constructive, the Tribunal found only that, as a director of and high managerial agent of PP during this period, he “knew or should have known” of the matters occurring over a long period of time in relation to PP and appreciated their seriousness (TR at [157]). It follows that there was no breach of procedural fairness in failing to advise of any possibility that a finding might be made that PP and/or Mr Wills had knowingly participated in fraud or dishonesty as encapsulated in the concept of a “rort”. The short point is that no such finding was made.
As to the Newbery report, Mr Wills’ disagreement with the weight given by the Tribunal to the report is in truth a disagreement with the merits of the Tribunal’s decision which this Court lacks power to consider on a judicial review application: Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24 at 41 (Mason J); Federal Commissioner of Taxation v Primary Health Care Ltd [2017] FCAFC 131; (2017) 252 FCR 496 at [21] (the Court). As earlier stated, the requirements of procedural fairness do not extend to a requirement to advise an applicant of the Tribunal’s internal thinking processes such as with respect to the weight which it may attach to particular documents or opinions.
5.2 Did the Tribunal fail to consider a relevant consideration (Ground 2)?
As earlier stated, the disposition of Ground 2 also turns upon the proper construction of the Tribunal’s reasons at [156] and its accompanying footnote. As I have already rejected Mr Wills’ construction of [156], it follows that Ground 2 must also be dismissed.
6. CONCLUSION
For the reasons set out above, the appeal under s 44 of the AAT Act must be dismissed with costs.
I certify that the preceding one hundred and forty-three (143) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Perry. Associate:
Dated: 9 February 2022
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