Wilson v Director-General of the Department of Fair Trading

[2003] NSWLEC 134

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Land and Environment Court

of New South Wales

CITATION:

Wilson v Director-General of the Department of Fair Trading [2003] NSWLEC 134

PARTIES:

APPELLANT
Michael John Wilson

RESPONDENT
Director-General of the Department of Fair Trading

FILE NUMBER(S):

30082 of 2003

CORAM:

Talbot J

KEY ISSUES:

Appeal :- against delegates decision to strike name off register dismissed

LEGISLATION CITED:

Crimes Act 1900 s 178BB
Valuers Registration Act 1975 s 20, s 23(1)

CASES CITED:

DATES OF HEARING:

02/06/2003

DATE OF JUDGMENT:

06/06/2003

LEGAL REPRESENTATIVES:

APPELLANT
Mr K Newell (Barrister)
SOLICITORS
N/A

RESPONDENT
Ms K Grant (Solicitor)
SOLICITORS
Department of Fair Trading

JUDGMENT:

IN THE LAND AND

ENVIRONMENT COURT

OF NEW SOUTH WALES

30082 of 2003

Talbot J

6 June 2003

Michael John Wilson

Appellant
v

Department of Fair Trading

Respondent

Judgment

Introduction

1 This is an appeal by Michael John Wilson, a Valuer, from the decision of the Director-General of the Department of Fair Trading (“the Director-General”) in respect to an inquiry conducted pursuant to s 20 of the Valuers Registration Act 1975 (“the Valuers Registration Act”).

2 Section 20 provides that where the Director-General is satisfied, after inquiries, that a registered real estate valuer has, inter alia:-

(a) been convicted in New South Wales or elsewhere by any Court of any crime or offence; or

(b) been guilty of misconduct in a professional respect;

the Court may by order reprimand or caution that real estate valuer, suspend his registration or cause his name to be removed from the register.

3 The circumstances giving rise to an inquiry pursuant to s 20 follows from proceedings before Judge Shadbolt in the District Court after committal for sentence in respect of an offence to which Mr Wilson pleaded guilty under s 178BB of the Crimes Act 1900 (“the Crimes Act”).

4 Section 178BB of the Crimes Act provides as follows:-

178BB Obtaining money etc by false or misleading statements

(1) Whosoever, with intent to obtain for himself or herself or another person any money or valuable thing or any financial advantage of any kind whatsoever, makes or publishes, or concurs in making or publishing, any statement (whether or not in writing) which he or she knows to be false or misleading in a material particular or which is false or misleading in a material particular and is made with reckless disregard as to whether it is true or is false or misleading in a material particular shall be liable to imprisonment for 5 years.
(2) …

5 Shadbolt DCJ found that on 11 February 1998 Mr Wilson participated in a transaction comprising a loan application by a fictitious person relying upon forged and fraudulent documents. The subject property was jointly owned by Mr Wilson and his business associate. The application was processed on the false documentation provided so that finance was made available to a fictitious purchaser in support of a land contract.

6 Similarly, on 31 March 1998 Mr Wilson’s associate made another application to finance the purchase of property in Queensland. Subsequently, Mr Wilson signed the loan contract and the associated documents in respect of that transaction to facilitate a loan for $690,000.

7 The purchase price in each case did not reflect the realistic values of the properties concerned.

8 As a result of the first transaction Mr Wilson was able to discharge personal liabilities secured over the subject property. He received a monetary payment for his participation in the second transaction. He had no direct interest in the property in Queensland.

9 The charge against Mr Wilson in the District Court was that he concurred in making statements which he knew to be false in support of loan applications and loan contracts with intent to obtain financial advantage.

10 Recognising the defendant’s plea of guilty, Shadbolt DCJ nevertheless deferred passing sentence and ordered that Mr Wilson enter into a recognisance to be of good behaviour for a period of three years and to appear, if called upon to do so, for any breach of that recognisance in that period.

11 Following the orders of Shadbolt DCJ on 11 October 1999 Mr Wilson completed an application for renewal of registration as a real estate valuer in May 2000. In that application he answered “no” to the following question:-

Since the date of the last renewal of your registration have you:
(i)…
(ii) been convicted of any offence or had any offence proved against you under any Act or regulation, including the Valuers Registration Act?

12 The above question was again answered in the negative in a further renewal application in May 2001.

13 In the proceedings before the Director-General the delegate of the Director-General (“the delegate”) published written reasons for his decision on 6 January 2003.

14 The following passage from the published reasons of the delegate are relevant:-

On 6 May 1999, the Valuer pleaded guilty in the District Court at Sydney to two counts of making a false statement with intent to obtain financial advantage contrary to section 178BB of the Crimes Act, 1900.
…
As described by His Honour, the Valuer, in association with other parties, participated in the preparation and forging of documents which where subsequently presented to the Colonial Bank in order to obtain loans for the purchase of properties at Coffs Harbour in NSW, and Sorrento in Queensland.

15 At p 8 of his reasons the delegate summed up and concluded as follows:-

I am not satisfied within the jurisdiction of section 20(3) of the Act that the offences which the Valuer was convicted of are trivial, and that from all their circumstances in which they occurred and for the other reasons stated, the offences, in the public interest, should not disqualify the Valuer in the public interest from practising as a real estate Valuer.
I am satisfied that the Valuer has been guilty of misconduct in a professional respect in relation to the circumstances surrounding the matters of his conviction, and of his failure to answer truthfully the relevant questions on his applications for renewal of his registration as a real estate valuer.
ORDER:
In accordance with section 20(1) of the Act, cause the name of the Valuer, Michael John Wilson, to be removed from the register. In accordance with section 20(2), I fix a time of five years from the date of the removal of the Valuer’s name from the register after which the Valuer may apply for restoration of his name to the register.

16 Mr Wilson has appealed to this Court pursuant to s 23(1) of the Valuers Registration Act, which directs that the appeal be dealt with by way of re-hearing. In deciding an appeal the Court may confirm the decision appealed against or substitute its own decision.

17 Mr Wilson elected not to give evidence before the delegate or during the hearing in this Court.

Grounds for Appeal

18 Mr Newell contends, on behalf of the appellant, that the delegate erroneously considered the charges against Mr Wilson as being two counts of making a false statement whereas the offences were in both cases concurring to make a false statement. Further, the delegate found that Mr Wilson had participated in the preparation and forging of documents.

19 It is correct that Mr Wilson was not charged with making a false statement and nor was it found that he physically participated in the preparation of the documents concerned.

20 However, s 178BB of the Crimes Act makes no distinction between an offence of actually making or an offence of concurring in the making of a statement known to be false or misleading. Accordingly, the law regards either action as equally deserving of a substantial penalty, up to the maximum of imprisonment for five years.

21 The appellant was clearly a major player in the schemes to defraud the bank and reaped a material benefit by the discharge of liabilities under mortgages over the properties in New South Wales and cash as a reward for his participation in the Queensland scheme.

22 The loans were made pursuant to a policy of the Colonial Bank (“the bank”) to lend up to 80 per cent of a purchase price without valuation. It cannot be said, therefore, that Mr Wilson used his professional expertise or asked the bank to rely on his opinion, as a valuer, in support of the loan application. Nevertheless, he participated as a party in the first property transaction, which was inherently dishonest, and collaborated in the commission of the second offence that also related to the fictitious sale of real estate.

23 Although it might be argued, as it is by Mr Newell, that the appellant was not guilty of professional misconduct, nonetheless his conduct was sufficiently related to his profession to justify an order causing his name to be removed from the register. The scheme was designed to obviate the need for a valuation. In those circumstances Mr Wilson is not entitled to rely on the distinction between participating in a real estate transaction and a valuation exercise, as Mr Newell seeks to do on his behalf.

24 It is claimed by Mr Newell, from the bar table without the benefit of direct evidence, that the appellant was under the impression that the bond, which he had been required to enter by Shadbolt DCJ, entitled him to answer the question in the application for renewal in the negative. The question in the form of application for renewal of licence, set out above, is in plain English and makes a clear distinction between conviction for an offence and having an offence proved. In circumstances where Mr Wilson had pleaded guilty and the passing of sentence was expressly deferred it is difficult to comprehend how he can claim a mistake or lack of understanding when addressing the question posed. Even if he did misunderstand the question in the manner submitted by Mr Newell nevertheless it would have been on such a basis that a prudent and honest man would have sought formal legal advice before providing the answer.

25 Furthermore, it should have been obvious to Mr Wilson, if indeed he was acting in an honest manner, that the circumstances of the offence charged pursuant to s 178BB were such that he would be obliged to disclose particulars in any application for renewal of a licence to practice a profession that relied upon the integrity of its participants. The failure by Mr Wilson to enter the witness box, either before the delegate or before this Court, only lends credence to an inference that he knew exactly what he was doing.

26 The grounds for this appeal provide corroboration that Mr Wilson still does not comprehend what is expected of him as a professional valuer. The attempted rationalisation of the degree of criminality involved by participation in the two fraudulent schemes shows that he is prepared to raise specious arguments about the distinction between physically signing a document and concurring in making the document in the circumstances where he was a direct participant in the false or misleading conduct with the intent of obtaining for himself a financial advantage. Any error on the part of the delegate in this regard is immaterial.

27 For the reasons outlined above the Court does not accept the further argument put on behalf of Mr Wilson that the delegate failed to exercise his discretion pursuant to s 20 to reprimand or caution the appellant or to find that the offence proved does not disqualify the appellant as a real estate valuer.

28 Mr Newell quite rightly concedes that the offences for which Mr Wilson was found guilty were not trivial in nature. There is no doubt, in the Court’s view, that the circumstances in which the offences occurred raise matters which clearly are in the public interest and justify a suspension of registration as a valuer on that basis.

29 When deciding not to commit Mr Wilson to a prison sentence, Judge Shadbolt took into account a number of factors, including Mr Wilson’s continuing assistance to the police in their inquiries regarding offences committed by the other participants in the scheme. Even if these matters fall for consideration in the present proceedings, which I strongly doubt, they do not bear upon the question of whether Mr Wilson is a fit and proper person to be registered as a practicing real estate valuer, at least for the time being.

30 The Court takes into account that the appellant has no previous convictions, he has not re-offended since entering into his recognisance on 11 October 1999 and he has been a registered real estate valuer since 1975. Nonetheless, the Court is satisfied that the behaviour of Mr Wilson is such that it would be reasonably regarded as disgraceful or dishonourable by other registered valuers of good repute and competency.

31 However, there is one aspect of this case that requires special consideration. That is, that it is now three years and eight months since Mr Wilson was required to enter into his recognisance in respect of offences which occurred approximately one and a half years prior to that. The Court could be persuaded to the view that the elapse of time, without further evidence of subsequent misconduct, could weigh in Mr Wilson’s favour. However, in the meantime he has chosen on at least two occasions to make application for a renewal of his registration without disclosing the circumstances of the charges against him in 1999. Even though the question in the application for renewal of registration directs attention to the date of the last renewal, Mr Wilson has continued to ride on the benefit flowing from the original form of answer given in 2000. The Court is not confident, therefore, that Mr Wilson has re-made himself to the extent that he can be regarded as a fit and proper person to be placed in the position of trust and integrity required from a real estate valuer.

32 It is one thing for Mr Wilson to be punished for the offences, it is another to allow him to practice as a registered real estate valuer in the interests of the whole community. The community must be entitled to expect that persons holding such a registration are of sufficient integrity to be regarded as fit and proper persons to act as a valuer. A valuer is required to be accurate and regarded as reliable and to take into account all relevant facts and circumstances when expressing an opinion upon the value of property. The public is entitled to expect that people who carry out such work are persons of good character.

33 Five written testimonials have been presented to the Court in support of Mr Wilson. Only one of these states that the author is aware of the circumstances surrounding the application to this Court, and even then there is no explanation of an understanding of the actions which gave rise to the situation in which Mr Wilson now finds himself. I am not persuaded that any of these testimonials lend sufficient weight to the case propounded on behalf of Mr Wilson to persuade the Court that he should be treated more leniently than he was by the delegate.

Findings

34 The appellant has been convicted of two serious offences of dishonesty and has failed to disclose these convictions in at least one application for renewal of registration as a real estate valuer and has subsequently compounded that omission by failing to draw the offences to the attention of the registration body.

35 The Court agrees with the submission made by Ms Grant, on behalf of the respondent, that the misconduct resulting in Mr Wilson’s conviction and his continued failure to disclose the conviction to the regulator, support the decision made by the delegate to remove his name from the register of valuers for a period of five years. The Court redetermines the matter in the same way for the reasons given above.

Orders

36 The Court makes the following orders:-

(1) Appeal dismissed.

(2) The decision by the delegate of the Director-General of the Department of Fair Trading on 6 January 2003 is confirmed.

(3) In accordance with s 20(1) of the Valuers Registration Act 1975, the name of Michael John Wilson is to be removed from the Register of Real Estate Valuers kept under that Act for a period of five years from this date.

(4) Costs reserved.

(5) The exhibit may be returned.