Zollo v Commissioner for Consumer Affairs - [2020] SASCFC 118

SUPREME COURT OF SOUTH AUSTRALIA
(Full Court)
ZOLLO v COMMISSIONER FOR CONSUMER AFFAIRS
[2020] SASCFC 118
Judgment of The Full Court
(The Honourable Justice Peek, The Honourable Justice Blue and The Honourable Justice Stanley)
4 December 2020
PROFESSIONS AND TRADES - BUILDERS - DISCIPLINARY PROCEEDINGS
STATUTES - ACTS OF PARLIAMENT - INTERPRETATION - GENERAL APPROACHES TO INTERPRETATION - WORDS TO BE GIVEN LITERAL AND GRAMMATICAL MEANING - PARTICULAR CASES
STATUTES - ACTS OF PARLIAMENT - OPERATION AND EFFECT OF ACTS - INTERACTION OF ACTS
In December 2016 the Commissioner for Consumer Affairs (the respondent) by complaint brought proceedings seeking disciplinary action against a building company, Built It Pty Ltd (Built It), and the appellant who was the director of Built It at the relevant time. The disciplinary action was brought pursuant to s 22 of the Building Work Contractors Act 1995 (SA) (the Act). The complaint brought by the respondent alleged six grounds for disciplinary action. Grounds 1 to 5 related to Built It. Ground 6 repeated grounds 1 to 5 and alleged that disciplinary action could be taken against the appellant personally by virtue of him being a director of Built It at the relevant time and on the basis there was proper cause for disciplinary action against the company.
Section 21(4) of the Act provides that disciplinary action may be taken against each director of a body corporate if there is proper cause for disciplinary action against the body corporate.
On 22 November 2017 a liquidator was appointed to Built It, which resulted in grounds 1 to 5 of the disciplinary complaint being stayed by virtue of s 471B of the Corporations Act 2001 (Cth). In the circumstances the respondent decided not to seek permission to proceed against Built It Pty Ltd (in liq) (Built It (in liq)) and only pursued ground 6 of the disciplinary complaint against the appellant personally. Built It (in liq) took no further part in the proceedings from the day on which it went into liquidation.
The appellant contended that the disciplinary proceedings brought against him were incompetent and were no longer available to the respondent on the ground that the operation of s 471B of the Corporations Act operated to stay the proceedings against the company.
The judge hearing the proceedings rejected the appellant’s submission and ruled the respondent could proceed against the appellant personally notwithstanding that the proceedings against the company in liquidation were stayed.
The judge ultimately found that there was proper cause for disciplinary action. In consequence, the judge made orders prohibiting the appellant from being licensed or registered under the Act; being employed or otherwise engaged in the business of a building work contractor; being a director of a body corporate that is a building work contractor; carrying on business as a building consultant; being employed or otherwise engaged in the business of a building consultant; and being a director of a body corporate that is a building consultant. The judge stipulated that these prohibitions were to apply permanently.
On this appeal the appellant contends that the judge erred in law in holding that the respondent could proceed against the appellant as a director of Built It (in liq) despite the proceedings against Built It being stayed by virtue of s 471B of the Corporations Act. He argues that in order to take proceedings against Built It (in liq) the respondent had to obtain permission from this Court pursuant to s 471B of the Corporations Act. The appellant further contends that the disciplinary action taken against him is manifestly excessive and was made based on an error of fact.
The appeal is out of time. The respondent did not oppose an extension of time within which to bring the appeal being granted.
Held per Stanley J, Peek and Blue JJ agreeing (dismissing the appeal):
1. An extension of time within which to bring the appeal is granted.
2. The judge was correct in holding that, as a matter of statutory construction, “proper cause for disciplinary action” in s 21(4) of the Act does not have the same meaning of “proper cause for taking disciplinary action” in s 25(1) of the Act. It follows that there was no error in the judge ruling that the respondent was entitled to pursue the complaint against the appellant.
3. No proper basis exists to interfere with the judge’s finding of fact.
4. In the circumstances the need for the protection of the public and the maintenance of the public’s confidence in the regulatory scheme required an order prohibiting the appellant from working within the building industry permanently. The orders made by the judge were not manifestly excessive.
Building Work Contractors Act 1995 (SA) s 20, s 21, s 22, s 23, s 24, s 25; Corporations Act 2001 (Cth) s 471B, referred to.
Commissioner for Consumer Affairs v Sollars (2001) 79 SASR 145; Papps v Medical Board of South Australia [2005] SASC 345; Craig v Medical Board of South Australia (2001) 79 SASR 45; Marin v Chiropractic Board of Australia [2020] SASCFC 74, applied.
Commissioner for Consumer Affairs v Built It Pty Ltd & Zollo [2019] SADC 66; Commissioner for Consumer Affairs v Built It Pty Ltd & Zollo (No 2) [2019] SADC 191, distinguished.
Certain Lloyd’s Underwriters v Cross (2012) 248 CLR 378; Fox v Percy 2003) 214 CLR 118; Grljusich v Andrews [2003] WASCA 206; Australian Securities and Investments Commission v Adler [2002] NSWSC 483 ; Australian Securities and Investments Commission v One Tech Media Ltd (No. 6) [2020] FCA 842; Mavaddat v Real Estate & Business Agents Supervisory Board [2009] WASCA 179; The Law Society of South Australia v Jordan (1998) 198 LSJS 434; New South Wales Bar Association v Evatt 1968) 117 CLR 177, considered.

ZOLLO v COMMISSIONER FOR CONSUMER AFFAIRS
[2020] SASCFC 118
Full Court: Peek, Blue and Stanley JJ

PEEK J: I would dismiss the appeal. I agree with the reasons of Stanley J.
BLUE J: I would dismiss the appeal. I agree with Stanley J.
STANLEY J:
Introduction
In December 2016 the Commissioner for Consumer Affairs (the respondent) by complaint brought proceedings seeking disciplinary action against a building company, Built It Pty Ltd (Built It), and the appellant who was the director of Built It at the relevant time. The disciplinary action was brought pursuant to s 22 of the Building Work Contractors Act 1995 (SA) (the Act). The complaint brought by the respondent alleged six grounds for disciplinary action. Grounds 1 to 5 related to Built It. Ground 6 repeated grounds 1 to 5 and alleged that disciplinary action could be taken against the appellant personally by virtue of him being a director of Built It at the relevant time and on the basis there was proper cause for disciplinary action against the company.
Section 21(4) of the Act provides that disciplinary action may be taken against each director of a body corporate if there is proper cause for disciplinary action against the body corporate.
On 22 November 2017 a liquidator was appointed to Built It, which resulted in grounds 1 to 5 of the disciplinary complaint being stayed by operation of s 471B of the Corporations Act 2001 (Cth) (Corporations Act). In the circumstances the respondent decided not to seek permission to proceed against Built It Pty Ltd (in liq) (Built It (in liq)) and only pursued ground 6 of the disciplinary complaint against the appellant personally. Built It (in liq) took no further part in the proceedings from the day on which it went into liquidation.
The proceedings were brought in the District Court. The appellant contended that the disciplinary proceedings brought against him were incompetent and were no longer available to the respondent on the ground that the operation of s 471B of the Corporations Act operated to stay the proceedings against the company.
The judge hearing the proceedings rejected the appellant’s submission and ruled the respondent could proceed against the appellant personally notwithstanding that the proceedings against the company in liquidation were stayed.
The trial proceeded and the judge found that there was proper cause for disciplinary action against Built It on five grounds. The judge found it had failed to provide a certificate of insurance for work performed for three consumers between 2011 and 2013 (grounds 1 to 3). The judge found the appellant acted improperly in the course of conducting the business of Built It between November 2011 and March 2015 because he was acting in breach of an undertaking he gave to the District Court on 21 March 2000 not to act as a director of a body corporate which held a building work contractor’s licence (ground 4). The judge found Built It would not have been entitled to be licensed as a building work contractor from November 2011 to March 2015 because the appellant was not a fit and proper person to be a director of the company by reason of his breach of the undertaking (ground 5).
Finally, the judge found that there was proper cause for disciplinary action against the appellant because there was proper cause for disciplinary action against Built It as alleged in grounds 1 to 5 and the appellant was a director of Built It at all relevant times (ground 6).
In consequence, the judge made orders prohibiting the appellant from being licensed or registered under the Act; being employed or otherwise engaged in the business of a building work contractor; being a director of a body corporate that is a building work contractor; carrying on business as a building consultant; being employed or otherwise engaged in the business of a building consultant; and being a director of a body corporate that is a building consultant. The judge stipulated that these prohibitions were to apply permanently. The power to make such orders is conferred by s 25(2)(a)(i) of the Act.
On this appeal the appellant contends that the judge erred in law in holding that the respondent could proceed against the appellant as a director of Built It (in liq) despite the proceedings against Built It being stayed by virtue of s 471B of the Corporations Act.
The appellant puts the consequential submission that in order to take proceedings against Built It (in liq) the respondent had to obtain permission from this Court pursuant to s 471B of the Corporations Act.
The appellant further contends that the disciplinary action taken against him is manifestly excessive.
The appeal is out of time. The respondent did not oppose the Court granting an extension of time.
Did the judge err in permitting the proceedings to continue against the appellant once they were stayed against the company?
The appellant submits that s 21(4) of the Act requires as a condition of taking disciplinary action against a director of a body corporate that is a building work contractor or building consultant that there exists proper cause for disciplinary action against the body corporate. Where the proceedings for disciplinary action against the body corporate have been stayed, the necessary condition for pursuing disciplinary action against a director does not exist. The judge erred in finding that proper cause existed for taking disciplinary action against the body corporate when the very proceedings alleging that disciplinary action be taken against the body corporate were stayed. In these circumstances the judge erred in finding that the necessary condition for the operation of s 21(4) was established.
The judge identified the issue as being whether the Court was able to make a finding that there was proper cause for disciplinary action against a body corporate in circumstances in which the Commissioner was not proceeding against the body corporate.
The judge referred to the provisions of s 25 of the Act which provide:
(1) On the hearing of a complaint, the Tribunal may, if it is satisfied on the balance of probabilities that there is proper cause for taking disciplinary action against the person to whom the complaint relates, by an order or orders do one or more of the following:
(a)     reprimand the person;
(b)     impose a fine not exceeding $20 000 on the person;
(c)     in the case of a person who is licensed as a building work contractor or registered as a building work supervisor—
(i) impose conditions or further conditions on the licence or registration;
(ii) suspend the licence or registration for a specified period or until the fulfilment of stipulated conditions or until further order;
(iii) cancel the licence or registration;
(d)     disqualify the person from being licensed or registered under this Act;
(e)     prohibit the person from being employed or otherwise engaged in the business of a building work contractor;
(f)      prohibit the person from being a director of a body corporate that is a building work contractor;
(g)     prohibit the person from carrying on business as a building consultant;
(h)     prohibit the person from being employed or otherwise engaged in the business of a building consultant;
(i)      prohibit the person from being a director of a body corporate that is a building consultant.
(2) The Tribunal may—
(a)     stipulate that a disqualification or prohibition is to apply—
(i) permanently; or
(ii) for a specified period; or
(iii) until the fulfilment of stipulated conditions; or
(iv) until further order;
(b)     stipulate that an order relating to a person is to have effect at a specified future time.
(3) If—
(a)     a person has been found guilty of an offence; and
(b)     the circumstances of the offence form, in whole or in part, the subject matter of the complaint,
the person is not liable to a fine under this section in respect of conduct giving rise to the offence.
The judge found that the respondent was entitled to proceed against the appellant even though the proceedings against the company were stayed for the following reasons:[1]
In my view, the word ‘taking’ has work to do in the phrase ‘proper cause for taking disciplinary action’ in s 25(1) of the Act. It is different from the phrase ‘proper cause for disciplinary action’ which appears in s 21 (1) to (4). Upon a consideration of Part 4 as a whole, it is evident the difference is relevant and purposeful.
Part 4 of the Act sets out three different stages or steps in the discipline of building work contractors, supervisors and building consultants. The first is the existence of a proper cause for disciplinary action (s 21). The second is the commencement of proceedings in the District Court by way of a complaint setting out matters alleged to constitute grounds for disciplinary action followed by a hearing to determine whether the matters so alleged constitute grounds for disciplinary action (ss 22 – 24). Finally, on the hearing of a complaint, the District Court may [sic] an order or orders if satisfied there is proper cause for taking disciplinary action against the person to whom the complaint relates. It is not until this third stage has been reached that it is correct to refer to the taking of disciplinary action. The making of such an order or orders is what is meant by taking of disciplinary action.
Section 21(4) and (5) deal with the circumstances in which disciplinary action may be taken against a director of a body corporate or may not be taken against a person by the making of orders pursuant to s 25(1).
Orders may be made against a director of a body corporate if there is proper cause for disciplinary action against the body corporate. This does not first require the taking of disciplinary action against the body corporate, that is, the making of an order or orders against the body corporate pursuant to s 25(1) of the Act. Rather, it requires the complainant to allege in the complaint that a ground for disciplinary action against the director is that there is proper cause for disciplinary action against the body corporate by reference to either s 21(1), (2) or (3). That will be the subject of the hearing of the complaint against the director and determination made pursuant to s 23 of the Act. If that is so determined, then the court may make an order or orders pursuant to s 25(1) if satisfied on the balance of probabilities there is proper cause for taking disciplinary action against the director.
An example of when the court may not be so satisfied is to be found in s 21(5) of the Act. Orders may not be made pursuant to s 25(1) against a person in relation to the act or default of another if that person could not reasonably be expected to have prevented the act or default.
This construction is to be preferred because it promotes the protective purpose of the legislation. For example, there may be occasion when the Commissioner does not become aware of the existence of a proper cause for disciplinary action until after a relevant body corporate has been deregistered. The Commissioner would not be able to proceed against the body corporate. If the construction contended for by the Second Respondent was preferred, then s 21(4) would prevent action being taken against any of the directors upon the body corporate becoming deregistered. Such a result would be inconsistent with the protective purpose of the legislation. The purposes of the Act and the disciplinary proceedings include regulating the conduct of persons who are licensed and/or registered under the Act, protecting the public and maintaining proper standards of conduct. It cannot be the case that the protection of the public may be comprised simply because the body corporate has become defunct in the meantime. The fact that disciplinary proceedings against directors are envisaged in such circumstances is consistent with the broad definitions of a ‘building work contractor’, ‘building consultant’, ‘building work supervisor’ and ‘director’ to include persons who were formerly in those positions.
[citation omitted, emphasis in original]
[1] Commissioner for Consumer Affairs v Built It Pty Ltd & Zollo [2019] SADC 66 at [34]-[39].
I do not accept the appellant’s contention that the judge erred in ruling that the respondent was allowed to proceed with taking disciplinary action against him.
The judge’s construction of Part 4 of the Act is correct. No error has been demonstrated.
It is convenient to start with the scheme of Part 4 as it stood at the time the orders were made by the judge.[2] Section 20 is definitional. Section 21 prescribes the circumstances which establish a proper cause for disciplinary action against a building work contractor, a building work supervisor, a building consultant and a director of a body corporate that is a building work contractor or building consultant. Section 22 permits the lodging with the District Court of a complaint alleging matters that constitute grounds for disciplinary action under Part 4. Section 23 provides for the hearing of the complaint by the District Court. It also confers additional powers on the Court in exercising the jurisdiction conferred by the Act. Section 24 allows the Court to sit with assessors for the purpose of determining proceedings under Part 4. I have set out the terms of s 25 earlier in these reasons. Section 25 provides for the disciplinary action the Court may take if it is satisfied on the balance of probabilities that there is proper cause for taking disciplinary action against the person to whom the complaint relates. Section 26 creates an offence where an individual contravenes an order of the District Court. Sections 21 to 25 are to be read temporally. The judge correctly identified the three-step process established by the Act. It is not until the final stage when orders may be made pursuant to s 25 that disciplinary action is actually taken against one of the persons identified in ss 21(1) to (4). It is only when s 25 is engaged that disciplinary action can be taken. It is the making of any of the orders prescribed in ss 25(1)(a) to (i) that constitutes “taking disciplinary action against the person to whom the complaint relates”.
[2] The Act was subsequently amended and jurisdiction conferred on the South Australian Civil and Administrative Tribunal (SACAT).

I come back to s 21(4). Section 21(4) is permissive.
The differences in the text of s 21(4) compared to s 25(1) are significant. Section 21(4) permits the taking of disciplinary action against a director if there is proper cause for disciplinary action against the body corporate. However, it does not require disciplinary action to be taken against the body corporate in those circumstances. But it conditions the taking of disciplinary action against the director on there being proper cause for disciplinary action against the body corporate. However, satisfaction that there is proper cause for disciplinary action against the body corporate is to be distinguished from taking disciplinary action against the body corporate. Orders can only be made pursuant to s 25(1) if the conditions it prescribes are established on the balance of probabilities, at a hearing of a complaint by the District Court, against the person to whom the complaint relates.
By contrast, the work performed by s 21(4) does not depend upon disciplinary action having been taken. The necessary condition for permitting disciplinary action to be taken against a director is a finding that there exists proper cause for disciplinary action against the body corporate. The District Court may find there is proper cause for disciplinary action against the body corporate without a hearing of a complaint against the body corporate. The taking of disciplinary action against the body corporate does not condition the taking of disciplinary action against a director of that body corporate.
This textual analysis is supported by a consideration of the purpose of s 21(4).[3] The judge was correct in holding that this textual analysis promotes the protective purpose of the Act. The purpose of the Act is consumer protection. Parliament is concerned to ensure that licensed and registered builders have appropriate qualifications and experience and are fit and proper persons to work in the building industry. That purpose is achieved by regulating the conduct of persons who are licensed or registered under the Act.   It is through the regulation and licensing of builders that proper standards of conduct are maintained in the building industry.[4] That purpose would be undermined if directors of body corporates operating in the industry could escape disciplinary action by deregistering the company thereby making proceedings against the company impossible. This is consistent with the expansive definition of “director” found in s 20 which extends the operation of Part 4 to former directors of a body corporate.
[3]    Certain Lloyd’s Underwriters v Cross [2012] HCA 56 at [23]-[26], (2012) 248 CLR 378 at 388-390.
[4]    See Commissioner for Consumer Affairs v Sollars [2001] SASC 110 at [47], (2001) 79 SASR 145 at 147.
Further, the judge only made findings of fact for the purpose of taking disciplinary action against the appellant as a “director” within the meaning of Part 4. The judge was not making findings of fact against Built It (in liq). There is no judgment, in rem or in personam, against the company. In these circumstances s 471B of the Corporations Act was not enlivened as no proceedings were taken against the company or in relation to the property of the company. For this reason the respondent did not need to obtain permission from this Court before taking disciplinary action against the appellant.
Accordingly, the judge was correct in holding that, as a matter of statutory construction, “proper cause for disciplinary action” in s 21(4) does not have the same meaning of “proper cause for taking disciplinary action” in s 25(1). It follows that there was no error in the judge ruling that the respondent was entitled to pursue the complaint against the appellant.
Was the disciplinary action taken by the judge manifestly excessive?
To establish that disciplinary action is manifestly excessive the appellant needs to establish that the action is obviously unreasonable or unjust,[5] in the sense that the disciplinary action is such as could not have been taken in a proper exercise of the discretion.[6]
[5] Papps v Medical Board of South Australia [2005] SASC 345 at [98].
[6] Commissioner of Consumer Affairs v Sollars [2001] SASC 110 at [24], (2001) 79 SASR 145 at 149.
However, the appellant also submits that not only were the orders made outside the range of disciplinary action that is reasonable and proportionate given the findings made by the judge, but that the judge took disciplinary action against him based on a mistake of fact.
The appellant submits that the error of fact made by the judge was in making orders on the basis that the judge found he acted improperly in the course of conducting the business of the first respondent between November 2011 and March 2015 because he was acting in breach of an undertaking he gave to the District Court on 21 March 2000. The appellant denies he gave the undertaking. Permission on this ground was refused but the appellant nonetheless sought to agitate it on appeal.
In the District Court proceedings the appellant gave evidence he did not sign the undertaking in 2000. He called his former solicitor, Mr Barone, to give evidence. Mr Barone no longer had any documents relating to the preparation of the undertaking. His recollection was vague. The judge rejected the appellant’s evidence that he did not sign the undertaking in March 2000. The judge did so in part because on 25 February 2009 the appellant appeared before Judge Muecke on his application to renew his building licence. During the course of his submissions he stated that he signed an agreement in 2000 saying that he would not be a director of the company.
No proper basis exists to interfere with the judge’s finding of fact. The judge had the advantage of hearing evidence from the appellant and Mr Barone. There is no basis to consider that the judge misused that advantage. Her rejection of the appellant’s evidence is not inconsistent with incontrovertible facts or uncontested testimony.[7] On the contrary, the appellant’s evidence is inconsistent with the Court record of submissions he made in 2009.
[7] Fox v Percy [2003] HCA 22 at [28], (2003) 214 CLR 118 at 128.
I reject the submission that the Court ordered disciplinary action based on an error of fact. To the extent that the appellant sought to renew the application for permission, I would refuse that application.
That leaves the appellant’s submission that the disciplinary action ordered against him by the Court was outside the range of disciplinary action available for the conduct found by the judge, i.e. the decision made was one which could not have been reached in a proper exercise of the discretion.
It is convenient to consider the reasons of the judge for making the orders.
The judge identified the purpose of s 25. The judge said:[8]
These proceedings are not for a punitive purpose, notwithstanding that the effect of any orders may have punitive consequences. Rather, the purpose is to protect the public. In so doing, disciplinary proceedings achieve the secondary purpose of upholding confidence and integrity in the building industry. The requirements set out in the Act perform an important function. Consumers place significant trust in, and reliance upon, those in the building industry to perform their duties diligently and in good faith.
[8] Commissioner for Consumer Affairs v Built It Pty Ltd & Zollo (No 2) [2019] SADC 191 at [12].
The judge explained the need for orders to be made against the appellant personally as follows:[9]
It is readily apparent, having regard to the purpose of the Act, that the actions of the second respondent necessitate the making of further orders against him. Protective orders were made in 1994 and then relaxed to some extent in 2000. In discharging the 1994 disqualification, the court gave the second respondent an opportunity, subject to an undertaking given by him, to demonstrate that disciplinary action was no longer required. I have not heard any evidence or received any other material which indicates there is no longer a need to protect the public.
As to the Commissioner’s application for an order prohibiting the second respondent from being a director of a body corporate that is a building work contractor, I note that this already exists by virtue of the second respondent’s undertaking to the court. However, the second respondent has challenged the validity of that undertaking. It is therefore necessary to make such an order pursuant to s 25(1)(f).
An assessment of whether orders should be made pursuant to s 25(1)(d), (e) and (g) to (i) involves, inter alia, an assessment of the conduct which led to the 1994 orders, the circumstances of the relaxation of those orders in 2000, and the second respondent’s conduct thereafter. In that respect, I have particular regard to the undertaking entered into by the second respondent, the failure to apply for a licence after 2000 when he was permitted to do so, and the way in which he instead established an alternative vehicle, in breach of his undertaking, to avoid having to apply for a licence personally.
[9] [2019] SADC 191 at [13]-[15].
The judge considered the appellant should be personally disqualified from being licensed or registered under the Act. She turned to the question of how long orders protecting the public were required. The judge said:[10]
The second respondent has demonstrated a determined willingness to act in contravention of his undertaking and the builders’ licensing scheme. He has failed to accept responsibility for his actions. The second respondent’s past actions and ongoing dismissive attitude to the protective regime tells me he is highly unlikely to accept and obey any conditions of a licence should he be permitted to reapply. He has demonstrated no contrition, remorse or insight into his conduct. His actions following the relaxing of the 1994 orders show that trust in him was misplaced. It would defeat the protective scheme of the Act if the second respondent were not permanently prohibited from operating within the building industry.
[10] [2019] SADC 191 at [17].
On that basis the judge concluded that it was necessary for comprehensive orders to be made prohibiting the appellant from working in the building industry again. The judge ordered the appellant be permanently disqualified from being licensed or registered under the Act pursuant to s 25(1)(d); permanently prohibited from being employed or otherwise engaged in the business of a building work contractor pursuant to s 25(e); permanently prohibited from being a director of a body corporate that is a building work contractor pursuant to s 25(f); permanently prohibited from carrying on business as a building consultant pursuant to s 25(g); permanently prohibited from being employed or otherwise engaged in the business of a building consultant pursuant to s 25(h); and permanently prohibited from being a director of a body corporate that is a building consultant.
The judge considered the seriousness of the appellant’s conduct by reference to his history of non-compliance, previous disqualification and the continued, deliberate and calculated breach of the undertaking given to the District Court.
On 25 February 1994 the Commercial Tribunal delivered judgment in disciplinary proceedings against the appellant. Fifteen breaches were found proved. The Tribunal found that proper cause existed for disciplinary action against the appellant on the basis he had ceased to be a fit and proper person to be licensed and registered under the Act. On 7 December 1994 the Tribunal cancelled the appellant’s licence as a builder and his registration as a building work supervisor. He was also disqualified from being licensed or registered until further order. On 21 March 2000 the disqualification imposed by the Tribunal in 1994 was discharged upon the appellant signing the undertaking referred to above that he would not act as a director of a body corporate which held a building work contractors licence. This enabled him to apply to the Commissioner for a licence or registration under the Act. He failed to do so.
In 2009 the appellant commenced proceedings in the District Court seeking an order that the Commissioner send an application to him to renew his licence. The proceedings were dismissed by Chief Judge Muecke, who nonetheless made it clear there was no impediment to the appellant applying to the respondent for a licence. However, rather than making that application, the appellant established Built It as a building work contractor. He procured others to be directors in name only to try and conceal the fact it was entirely the appellant’s business. He used the title “estimator” and described himself during those proceedings as a mere employee in an attempt to conceal his true role. The judge held that the appellant’s breach of his undertaking was deliberate, calculated and continued for over three years. In doing so, he deliberately and consciously sought to subvert both his undertaking to the Court and the builders licensing regime.
The following factors should be weighed by courts when determining the appropriate period of a disqualification:
(1)general deterrence;[11]
(2)the circumstances surrounding the conduct, and the professionalism and character of the person;[12]
(3)the degree of seriousness of the contravention; the propensity of the person to engage in similar conduct in the future; and the likely harm that may be caused to the public;[13] and
(4)whether the person is capable of re-establishing themselves in the future.[14]
[11] Craig v Medical Board of South Australia [2001] SASC 169 at [47], (2001) 79 SASR 45 at 555; Marin v Chiropractic Board of Australia [2020] SASCFC 74 at [73].
[12] Grljusich v Andrews [2003] WASCA 206 at [161].
[13] Australian Securities and Investments Commission v Adler [2002] NSWSC 483 at [56]; Australian Securities and Investments Commission v One Tech Media Ltd (No. 6) [2020] FCA 842 at [26].
[14] Mavaddat v Real Estate & Business Agents Supervisory Board [2009] WASCA 179 at [95].
The appellant submits that the making of the orders on a permanent basis is harsh and excessive. He submits that his entire working life has been in the building trade. He is 72 years of age.
The respondent accepts that the sanction imposed by the judge is very much at the upper end of the range of sanctions available in the disciplinary scheme and effectively excludes the appellant from the overwhelming majority of work in the building industry on a permanent basis. Nonetheless the respondent contends that the circumstances of this case warrant the orders made by the judge.
The purpose of disciplinary proceedings is to protect the public, not to punish a person.[15] However, the operation of the order may seem punitive.[16] In fact, the protection of the public may require the making of an order that has a greater adverse effect on a person than might be warranted if punishment, in the sense of a sanction imposed by the criminal law, was the only consideration.[17] The protection of the public may also require a sanction that emphasises personal as well as general deterrence.[18]
[15] Marin v Chiropractic Board of Australia [2020] SASCFC 74 at [2]; Craig v Medical Board of South Australia [2001] SASC 169 at [41], (2001) 79 SASR 45 at 553-554.
[16] The Law Society of South Australia v Jordan (1998) 198 LSJS 434 at 460; Commissioner of Consumer Affairs v Sollars [2001] SASC 110 at [18], (2001) 79 SASR 145 at 148.
[17] Craig v Medical Board of South Australia [2001] SASC 169 at [43], (2001) 79 SASR 45 at 554; New South Wales Bar Association v Evatt [1968] HCA 20, (1968) 117 CLR 177 at 183-184.
[18] Craig v Medical Board of South Australia [2001] SASC 169 at [47], (2001) 79 SASR 45 at 555; Marin v Chiropractic Board of Australia [2020] SASCFC 74 at [73].
The respondent submits that the appellant’s conduct in respect of the undertaking, and the circumstances and way in which that undertaking was breached, are the most serious aspects of his conduct. The appellant’s actions in knowingly breaching the undertaking for a period of approximately three years and four months was serious, ongoing and deliberate. The content of the breach was acting as a de facto director with control of the body corporate while procuring others to appear as directors on paper to facilitate the deception of the public and the regulatory authority. In addition, the appellant failed to comply with the legislative requirement to provide necessary insurance documents to the owners of three houses where he was working. The respondent submits the appellant’s actions can be characterised as deliberate, calculated and brazen. He has shown no remorse, insight or contrition into his conduct. He has not taken responsibility for his actions nor acknowledged the wrongfulness of them.
In my view, the conduct of the appellant was very serious. The need for the protection of the public and the maintenance of the public’s confidence in the regulatory scheme required an order prohibiting the appellant from working within the building industry permanently. I do not consider that the making of orders permanently prohibiting the appellant from being licensed or registered under the Act, or working in the building industry, is manifestly excessive. Having regard to the nature and extent of his conduct, its seriousness, the period of time over which it occurred, that it was deliberate, calculated and involved the deception of the public and the regulatory authority, I do not consider that this Court should interfere with the orders made by the judge. The making of orders is not to be undertaken solely by reference to the circumstances and conduct of the person against whom the orders are made. As orders are being made to protect the public, the issue is whether permanent orders were within the appropriate range of disciplinary action available to the judge. For the reasons set out above, notwithstanding the respondent’s acceptance that the orders made by the judge were at the upper end of the range, I accept they were within the range. Permanent orders are justified for the purposes of general deterrence. I emphasise that the appellant’s age is a relevant factor. Whether permanent orders would be appropriate in the case of a much younger person is a question for another day.
In the circumstances the permanent orders made by the judge are not manifestly excessive. The appellant has not established any ground that would justify interference by this Court with the orders made by the District Court.
Conclusion
I would grant an extension of time within which to bring the appeal. I would dismiss the appeal. I would hear the parties as to costs.