Civil and Administrative Tribunal New South Wales Medium Neutral Citation: Nassif v Commissioner for Fair Trading; Toplace Pty Ltd v Commissioner for Fair Trading [2023] NSWCATOD 4 Hearing dates: 20 December 2022 Date of orders: 05 January 2023 Decision date: 05 January 2023 Jurisdiction: Occupational Division Before: T Simon, Principal Member Decision: In matter 2022/00375413: (1) The decision of the Commissioner for Fair Trading, made on 2 December 2022, to cancel Jean Khazen Nassif's supervisor certificate No. 21450S and disqualify him from holding any authority under the Home Building Act 1989, is stayed until determination of the application to review the decision (filed 13 December 2022) on condition that: Jean Khazen Nassif will not enter into any further contracts to do residential building work without the consent of the respondent or leave of the Tribunal In matter 2022/00375423: (1) The decision of the Commissioner for Fair Trading, made on 1 December 2022, to cancel Toplace Pty Ltd's contractor licence No. 215731C and disqualify Toplace Pty Ltd from holding any authority under the Home Building Act 1989, is stayed until determination of the application to review the decision (filed 13 December 2022) and on condition that: Toplace Pty Ltd will not enter into any further contracts to do residential building work without the consent of the respondent or leave of the Tribunal. Catchwords: ADMINISTRATIVE LAW - REVIEW OF DECISION BY EXTERNAL DECISION-MAKER — decision to cancel contractor licence and disqualify a licence holder pursuant to the Home Building Act 1989 (NSW) PRACTICE AND PROCEDURE — INTERLOCUTORY ORDER – interim decision — factors relevant to exercise of the power to make the interim decision under section 60 of the Administrative Decisions Review Act 1997 (NSW) Legislation Cited: Administrative Decisions Review Act 1997 (NSW) Civil and Administrative Tribunal Act 2013 (NSW) Civil and Administrative Tribunal Rules 2014 (NSW) Home Building Act 1989 (NSW) Residential Apartment Buildings (Compliance & Enforcement Powers) Act 2020 (NSW) Cases Cited: QLD Protection Security Pty Ltd v Commissioner of Police, NSW Police Force [2018] NSWCATAP 113 Texts Cited: None Cited Category: Principal judgment Parties: In matter 2022/00375413 Jean Khazen Nassif (Applicant) Commissioner for Fair Trading (Respondent) In matter 2022/00375423 Toplace Pty Ltd (Applicant) Commissioner for Fair Trading (Respondent) Representation: Counsel S Robertson SC, J Mack and B Smith (Applicants) M Fozzard (Respondent) Solicitors: EA Legal Pty Ltd (Applicants) Legal, Corporate Services, Department of Customer Services (Respondent) File Number(s): 2022/00375413 2022/00375423 Publication restriction: Nil Reasons for Decision 1. On 13 December 2022 the Tribunal received two applications for review of two decisions made by the Commissioner for Fair Trading (the Commissioner). Jean Khazen Nassif, the applicant in matter 2022/0375423, is a director and building supervisor of Toplace Pty Ltd, the applicant in application 2022/0375423. 2. On 13 December 2022, the Tribunal also received applications from each of the applicants for the Tribunal to make interim orders staying the decisions of the Commissioner until determination of the substantive review applications. There have been no finalised internal reviews provided with the application and the applicants were seeking an exception to the requirement of a finalised internal review on the basis that the applications needed to be dealt with urgently. 3. Application 2022/00375413 is for review of a decision made by the Commissioner on 2 December 2022 cancelling the supervisor license of Jean Nassif and disqualifying him from holding an authority or being a member of a partnership or officer of a Corporation under the Home Building Act 1989 (NSW) for a period on ten years (the Nassif decision). That decision was to take effect at 5pm on 16 December 2022. 4. Application 2022/0375423 is for review of a decision made by the Commissioner on 1 December 2022 cancelling the contractor license of Toplace Pty Ltd and permanently disqualifying Toplace Pty Ltd from being the holder of any authority under the Home Building Act (the Toplace decision). That decision was to take effect at 5pm on 15 December 2022. 5. On 14 December 2022, I ordered that each of the decisions of the Commissioner be stayed until 5pm on 20 December 2022 and made directions for the exchange of submissions and documents in relation to the applications for interim orders. 6. On 20 December 2022, I extended the stay order on the Toplace and Nassif decisions until 5pm on 6 January 2023 and reserved my final decision in relation to the application for a stay of the decisions. 7. The parties each provided written submissions in the matter and the applicants provided an affidavit, dated 12 December 2022, of Mr Gregory Bernard Wee, who is the solicitor on record for the applicants. Attached to the affidavit were 5 volumes of material which comprised exhibits to the affidavit. The parties also made oral submissions regarding the interim orders at the hearing. The Tribunal has considered that material and submissions in coming to its decision. 8. I have decided to stay both the Nassif and Toplace decisions, until determination of the substantive review applications, subject to the condition that neither party enter any further contracts to do residential building work without the consent of the respondent or leave of the Tribunal. These reasons for decision relate to the application for the stay order in both matters. The Administratively Reviewable Decisions 1. In the reasons for the Toplace decision, the delegate for the Commissioner states that disciplinary action was taken against Toplace Pty Ltd on two grounds: 1. That Toplace Pty Ltd was guilty of improper conduct under s 56(c) of the Home Building Act. 2. That Toplace Pty Ltd was not a fit and proper person to hold the contractor licence under s 56(b) of the Home Building Act. 1. The disciplinary action relates to building works for at the following developments: 1. A development located on Old Northern Road, Castle Hill (Old Northern Road development). That development comprised of the construction of 378 apartments, retail units at ground level and five levels of basement car parking. 2. A development located at Charles Street, Canterbury (Canterbury development). That development comprised of the construction of three residential flat buildings and an associated basement car park. 3. A development located at Old Castle Hill Road, Castle Hill (Old Castle Hill Road Development). That development comprised of 428 apartments in total. 1. The reasons disclose a series of findings in relation to each of the developments which constitute serious defects and potential serious defects, including defects in relation to waterproofing, fire safety, structural systems and other building defects. The delegate made findings that Toplace Pty Ltd: 1. Breached the statutory warranty contained in s 18B(1)(a) of the Home Building Act by failing to construct the Old Northern Road development and Old Castle Hill Road development with due skill and care – see 51 (1)(c) of the Home Building Act and; 2. Breached the statutory warranty contained in s18B(1)(c) in relation to the Old Castle Hill Road development as the work was not done in accordance with the Home Building Act or another law – see 51 (1) (c) of the Home Building Act. 1. Additionally, there were 30 defects asserted to have been found at the Canterbury development. 2. In the reasons for the Nassif decision, a delegate for the Commissioner found Mr Nassif guilty of improper conduct in his own right as an authority holder. Section 54 (1) of the Home Building Act, states that an individual who is an officer of a corporation that is the holder of a contractor licence, is guilty of improper conduct if the holder does any of the things referred to in s 51 of the Act. As Mr Nassif was the sole director and secretary of Toplace Pty Ltd and given the finding of improper conduct made against the Toplace Pty Ltd, Mr Nassif was also deemed guilty of improper conduct. The Review Applications and Internal Review 1. Section 30 of the Civil and Administrative Tribunal Act 2013 (NSW) states that the Administrative Decisions Review Act 1997 (NSW) provides for the circumstances in which the Tribunal has administrative review jurisdiction over a decision of an administrator. Pursuant to s 9(1) of the Administrative Decisions Review Act, the Tribunal has administrative review jurisdiction over a decision of an administrator if enabling legislation provides that applications may be made to the Tribunal for an administrative review under the Administrative Decisions Review Act. 2. Section 83B (3) of the Home Building Act provides for a person aggrieved by a decision to cancel or suspend an authority to apply to the Tribunal for administrative review under the Administrative Decisions Review Act. 3. Applications made to the Tribunal under the Administrative Decisions Review Act may not be made unless the applicant has applied for an internal review and the review is taken to have been finalised (Administrative Decisions Review Act, s 55(3)). However, if this has not occurred, the Tribunal may deal with the application if it is satisfied that it is necessary to do so to protect the applicant's interests and the application was made within a reasonable time (Administrative Decisions Review Act, s 55(4)). 4. The applicants did not apply for internal review of the decisions to cancel their authorities and disqualify them from holding licenses. The Nassif decision was made on 1 December 2022 and the Toplace decision was made on 2 December 2022. The applicants state in their applications that they were advised of the decisions on the date they were made. The applicants applied to the Tribunal for review of each of the decisions on 13 December 2022 and made the applications for interim orders on the same day. I am satisfied the applications to the Tribunal were made within a reasonable time. 5. The decisions to cancel the applicants' licenses and disqualify the applicants from holding authorities were each to take effect 14 days from the date they were made. In those circumstances I find it is necessary for the Tribunal to deal with the application to protect the applicants' interests (Administrative Decisions Review Act, s 55(4)(b)). 6. I accept from the affidavit of Mr Wee that the applicants' interests are immediately and directly affected by the decision to cancel their licences. I accept that the cancellation of the licences and disqualification from holding a licence will result in them not being able to undertake building and rectification works which Toplace Pty Ltd is currently undertaking. The situation has a degree of urgency, given the developments presently on foot and the nature of the rectification work being undertaken. 7. For those reasons, I have decided to deal with the application, notwithstanding that the applicants did not apply for an internal review. The interim applications for stay of the decisions 1. Both applicants seek interim orders for a stay of the relevant decisions until the final determination of the substantive application by the Tribunal in these proceedings, pursuant to s 60(2) of the Administrative Decisions Review Act. 2. The Commissioner opposes the grant of the interim orders. 3. The Tribunal has power to make an order "staying or otherwise affecting the operation of the decision under review" (s 60(2) of the Administrative Decisions Review Act). Section 60(3) of the Administrative Decisions Review Act empowers the Tribunal to make orders, if it considers that it is desirable to do so after considering: (a) the interests of any persons who may be affected by the determination of the application, and (b) any submission made by or on behalf of the administrator who made the decision to which the application relates, and (c) the public interest. 1. In QLD Protection Security Pty Ltd v Commissioner of Police, NSW Police Force [2018] NSWCATAP 113, the Appeal Panel of this Tribunal summarised the considerations which should be applied when considering a stay in matters such as this as including (at [32]); (1) whether the order is appropriate to secure the effectiveness of the determination of the application for review: s 60(2), ADR Act. (2) whether the order is desirable taking into account: (a) the interests of any persons who may be affected by the determination of the application for review: s 60(3)(a), ADR Act, Loveday v Commissioner for Fair Trading [2018] NSWCATAD 80 (Loveday) at [10], Re Scott and Australian Securities and Investments Commission [2009] AATA 798 (Re Scott) at [4]; (b) any submission made by or on behalf of the administrator who made the decision to which the application relates: s 60(3)(b), ADR Act, Loveday at [10], Re Scott at [4]; (c) the public interest: s 60(3)(c), ADR Act, Loveday at [10], Re Scott at [4]; (3) the applicant's prospects of success on the application for review: AVS Group of Companies Pty Ltd v Commissioner of Police [2010] NSWCA 81 (AVS Group) at [129], Loveday at [10] and [11], Re Scott at [4]. Effect on the applicants, contracted parties, subcontractors and others 1. In his affidavit, Mr Wee states that he is a solicitor in the employ of EA Legal Pty Ltd. In that capacity, from time-to-time, he fulfils the role of in-house counsel for Toplace Pty Ltd. In his affidavit Mr Wee describes how the applicants, employees, subcontractors and parties with which Toplace Pty Ltd is currently contracted with for construction of residences and rectification work would be affected if the stay order was not made. 2. Mr Wee states that Toplace Pty Ltd currently has two projects under construction as follows: 1. Skyview Development at Castle Hill. The development consists of five residential apartment towers, two towers have already been completed and three towers consisting of 536 residential apartments are currently under construction. 2. Box Hill Development. That development consists of 660 residential apartments and a retail shopping centre 1. Copies of the construction contracts for each of the developments have been provided as exhibits to the affidavit of Mr Wee. 2. Mr Wee describes the consequences for contracts of sale which have been exchanged and have not yet settled in relation to the current development. For each of the developments, Toplace Pty Ltd is named as the contractor. Mr Wee states that a special purpose vehicle, which is a related entity of Toplace Pty Ltd, is the principal under the construction contracts. That special purpose vehicle owns the land on which the development is occurring. That special purpose vehicle is also the entity which sells apartments, either off the plan or completed, to purchasers. Mr Wee has included a spreadsheet containing all apartments constructed by Toplace Pty Ltd in respect of which contracts that have been exchanged but have not yet settled. The spreadsheet shows a total number of 86 contracts with a total value of $74,075,887.50. Mr Wee also states that he has been informed by Mr Phillip Meyers, Director of Sales and Marketing of Toplace Pty Ltd, that those contracts are at risk of not settling if Toplace Pty Ltd.'s contractor licence is cancelled. In addition to the exchanged contracts, there is a further 64 sales of apartments constructed by Toplace Pty Ltd across multiple projects for which contracts have been issued and a reserve deposit has been paid by prospective purchasers, but contracts have not been exchanged. They are to the value of $48,330,450 million and he states that they will also be in jeopardy if the stay is not granted. 3. Mr Wee also describes how each of the finance arrangements for each the developments are at risk. Mr Wee states that the Skyview Development is primarily financed by Westpac Banking Corporation and the Box Hill Development is financed by PAG. He has included the construction facility contracts as exhibits to the affidavit. Mr Nassif and two other related entities are guarantors in relation to both finance arrangements. The finance arrangements require certain construction and sales milestones to be completed, to the satisfaction of the financier, before relevant stages of finance funding can be drawn down. 4. Under both funding facilities the borrower receives funds drawn down and then uses them to pay Toplace Pty Ltd under the construction contracts. Toplace Pty Ltd then uses that funding to pay its subcontractors. Mr Wee was informed by John Pettigrew, the Chief Financial Officer of Toplace Pty Ltd that as is required, Westpac and PAG were informed of the Toplace and Nassif decisions. Westpac has asserted that the Toplace decision constitutes an event of default under the finance facility and regards the Toplace decision as a very serious breach. Westpac advised that they would not be honouring any drawdowns of further funding under the Skyview finance facility. In respect of PAG, they regard the Toplace decision as a very serious breach and will be referring the matter to its senior credit committee to determine the consequences of the Toplace decision. 5. Mr Pettigrew has also informed Mr Wee that in respect of both the Westpac and PAG facilities, it is open to the financiers to formally declare that the borrowers are in breach of the respective finance facilities, terminate the facilities and take possession of the current development sites. 6. Mr Pettigrew has told Mr Wee that he is presently working on three refinancing deals for various sites owned by entities within the Toplace Group and that could result in higher interest rates on the loan facilities and increase the cost of debt for entities within the Toplace Group significantly. 7. Mr Wee also describes the construction consequences of the Nassif and Toplace decisions. He has been informed by Mr Charbel Barakat, the Construction Director of Toplace Pty Ltd, that he is concerned that if the Nassif and Toplace decisions take effect then Toplace Pty Ltd will be in breach of its agreements with subcontractors, consultants, suppliers, and principals of the projects. Toplace Pty Ltd will incur losses due to liability for liquidated damages accruing under various contracts and current projects will be unable to continue and construction will come to a halt. Mr Barakat also informed Mr Wee that safety issues will arise, and subcontractors and suppliers will demand immediate payment of debts. The financiers will cease providing monthly drawdowns under construction facilities and may seek to exercise step-in or other rights arising for alleged breaches of the loan facilitates, which could result in insolvency, external administration or liquidation of Toplace Pty Ltd. Interest on construction facilities will continue to accrue and Toplace Pty Ltd will continue to incur fixed overheads and staff costs. Mr Barakat believes there will be irreparable damage to the brand and ability to secure future finance. As a result, Toplace Pty Ltd will be unable to undertake rectification work on defects on completed projects and works will also come to a halt on rectification work and Toplace Pty Ltd will breach rectification deeds and be liable for damages as a result. 8. In relation to the effect on the employees of Toplace Pty Ltd, Mr Wee has been informed by Nilanga Seneviratne, an Accounts Manager at Toplace Pty Ltd, that Toplace Pty Ltd has 37 employees and all those employees' positions would be in jeopardy should the Nassif and Toplace decisions take effect. 9. In relation to subcontractors, Mr Wee has been informed by Norman Read, a Project Manager employed by Toplace Pty Ltd, that if the Nassif and Toplace decisions take effect, Toplace Pty Ltd may be unable to pay its subcontractors if it cannot draw down on its construction facilities. Further, Mr Wee has provided a copy of current subcontractor spreadsheet for the Skyview Development and the Box Hill Development. The spreadsheets were compiled by Olivier Friscan, Senior Contracts Administrator of Toplace Pty Ltd. The spreadsheet reveals that Toplace Pty Ltd has 51 subcontractors for the Skyview Development, consisting of 37 formal subcontracts and 14 purchase order arrangements, with the aggregate estimated contract price of those 51 subcontracts is $118,670,285.96. The Box Hill Development has 16 subcontractors for that development, consisting of 8 formal subcontracts and 6 verbal contracts. The aggregate estimated contract price of those 16 subcontracts (not including contracts which are based on rates or a schedule of rates and for which the estimated price cannot yet be determined) is $8,407,618.30. 10. Mr Friscan estimates, based on quantity surveyor analysis, that there is an overall value of between $144,000,000 and $147,000,000 for present and future subcontracts awarded by Toplace Pty Ltd. 11. In relation to works presently being undertaken in relation to defects on past projects, Mr Wee states that Toplace Pty Ltd has been working with the NSW Building Commissioner to identify and rectify those defects. Mr Wee states that the key impacts of the Nassif and Toplace decisions will be that there will need to be an immediate stoppage of all rectification work which is being carried out by Toplace Pty Ltd or engaged sub-contractors. The defect work relates to water ingress and, that has potential effects on owners and occupiers of units who are experiencing water ingress and resulting health hazards such as mould. 12. Mr Wee also states that according to Mr Craig Sammut, the Defects Manager of Toplace Pty Ltd, of the approximately 5171 units in Toplace Pty Ltd projects with reported defects, about 899 units are currently either the subject of pending defect repairs or under repair by Toplace Pty Ltd employees or sub-contractors. 530 units have already had defects repaired within these projects. Much of the rectification work is subject of legally binding arrangements, including deeds, agreements or orders and must be rectified within prescribed timeframes. 13. Mr Wee also outlines in his affidavit that Toplace Pty Ltd advanced a proposal to Westpac whereby Mr Barakat, would take over supervision of Toplace Pty Ltd.'s current construction work under his supervisor certificate and for a company controlled by him, CBUS Construction, to take over the present developments of Toplace Pty Ltd. Mr Wee was informed by Mr Pettigrew that on 8 December 2022, Westpac had indicated that the CBUS Construction proposal was not acceptable because of the relationship between Toplace Pty Ltd and CBUS Construction through Mr Barakat. 14. Mr Wee also describes what he refers to as safety concerns which will arise out of the cancellation of the license and the requirement to cease work. He states that he is informed by Michael Connelly, a Senior Safety Advisor employed by Toplace Pty Ltd, that: 1. the Skyview Development is surrounded by scaffolding up to 78 metres high and some of this scaffolding is partially constructed. The scaffolding requires constant maintenance due to the risks posed by inclement weather. Work, health and safety regulations require that the scaffolding be certified monthly. Without constant supervision, the scaffolding will deteriorate and become unsafe, which could result in parts of the scaffolding flying off or collapsing. 2. There are temporary electrical installations throughout the current developments which require monthly testing and certification to ensure compliance with Australian Standards and constant checking for damage to cables and electrical boards to prevent electrical hazards. 3. The current developments both have perimeter fencing and hoardings which require constant maintenance to ensure that they are secure, preventing unauthorised access to the sites. The perimeter fencing at the Box Hill Development is protecting the public against deep trenches which have been dug inside the boundary of the site. The current developments both have safety fencing, which prevents workers falling from a height, and penetration covers, which prevent workers falling through holes in walls and floors. Those require constant checking and maintenance to prevent deterioration and the risk of falls. 4. The Box Hill Development requires continual pumping out of groundwater and stormwater, as the stormwater infrastructure has not yet been constructed and the runoff from surrounding areas is directed into the site. The basements of the buildings will fill with water, which creates a risk of drowning and the electrical equipment in the buildings will be inundated with water, creating a risk of electrocution. 5. The current developments have four tower cranes on site which require constant servicing and maintenance. If these pieces of plant are not in operation, a hazard is created by the increase of rust and the deterioration of grease and lubricants. 1. Having considered the affidavit of Mr Wee, I am satisfied that the cancellation of the applicants' licenses and the disqualification of the applicants from holding authorities under the Home Building Act, would have significant effect on the applicants, parties with whom they have contracted or have arrangements to undertaking rectification work and the applicants' subcontractors and employees. I find, based on the affidavit evidence of Mr Wee, that Toplace Pty Ltd is presently involved in the construction of two sizeable developments and undertaking rectification of defects work on previous developments. I am satisfied that should the Toplace and Nassif decisions take effect, it will result in Toplace Pty Ltd breaching contracts which are currently on foot and breaching the requirements of finance facilities funding the current projects. I am satisfied that as a result there will be significant financial loss to Toplace Pty Ltd in the period in which it will not be able to undertake works, in particular the works relating to the contracts which are currently on foot. I also accept that the cancellation will have significant legal implications on finance facilities, contracts with purchasers, subcontractors and suppliers and arrangements in relation to rectification of defects work on previous projects. 2. The Commissioner does not accept the cancellation of the applicants' licences removes the obligation of the applicants, to leave any building site unsafe, unattended, or unmaintained. The Commissioner submits that the applicants have obligations under its contracts and Workplace Health and Safety requirements to secure the sites. The Commissioner submits that it may be appropriate that a stay could be made subject to conditions or other arrangements to accommodate the preservation of safety to the site until another builder is appointed. 3. Having considered the submissions of the Commissioner in that regard, I am not persuaded that the cancellation will not raise the safety concerns as raised by the applicants. While the cancellation of the licenses may not excuse the applicants from their safety obligations, the financial and contract consequences which have been outlined by Mr Wee in his affidavit will have some effect on the applicant's ability to pay for and comply with the safety requirements. While I do not have a full financial disclosure from Toplace Pty Ltd, I accept on the evidence before me that the cancellation of the licensing would result in Toplace Pty Ltd not being able to complete works for which they are contracted for and that will have substantial financial consequences for the Corporation. In those circumstances, there is a risk that Toplace Pty Ltd may at some stage become unable to meet its obligations in relation to the safety concerns being raised. It is also uncertain when an alternative builder could be found to take over the developments or whether an alternative builder could be found at all. As has been identified from the proposal to engage CBUS Constructions, any new builder would need to at least be acceptable to the financier. 4. I accept that the financial impact described in Mr Wee's affidavit will have flow on affects as to whether Toplace Pty Ltd will be able to retain all or any of its current employees or fulfill its obligations in relation to subcontractors currently engaged to complete works related to the current developments and rectification work. 5. The Commissioner submits that there is no evidence that any of the projects referred to by the applicants are dependant, in any way, on Mr Nassif as supervisor. Toplace Pty Ltd holds a contractor licence and Mr Nassif is the sole director of Toplace Pty Ltd. Section 33C of the Home Building Act relevantly states: (1) A contractor licence must not be issued unless the Secretary is satisfied that— (a) the applicant has, or proposes to have, such numbers of nominated supervisors for the contractor licence as the Secretary considers are needed to ensure that all work for which the contractor licence is required will be done or supervised by qualified individuals, and (b) the applicant, if also applying for an endorsement of the contractor licence to show that it is the equivalent of a supervisor certificate— (i) satisfies the requirements of section 33D for the issue of a supervisor certificate to the applicant, and (ii) is not disqualified from holding a supervisor certificate or a supervisor certificate of a particular kind, and (iii) is not the holder of a supervisor certificate that is suspended. … (6) An individual may be a nominated supervisor for a contractor licence only if the individual— (a) holds an endorsed contractor licence or a supervisor certificate that authorises its holder to supervise some or all of the work done under contracts for which the contractor licence applied for or held is required, and (b) is, or is proposed by the applicant or holder to be, an employee of, or a member of the partnership or director of the corporation that is, the applicant or holder, and (c) made a consent declaration that is lodged with the Secretary and has not been revoked. 1. Section 24(4) of the Home Building Act allows for application for supervisor certificates to be made by an individual, and not by a corporation, partnership or other association. 2. I reject the Commissioner's submissions that there is no evidence that any of the projects referred to by the applicants are dependent on Mr Nassif as supervisor. Staying the Toplace decision would not be sufficient if there was not a nominated supervisor for the Toplace Pty Ltd contractor licence. Presently, that nominated supervisor is Mr Nassif and in that regard the licensing of Toplace Pty Ltd is presently dependant on Mr Nassif being licensed as the nominated supervisor. While it may be possible that another nominated supervisor could be appointed by the Toplace Pty Ltd, that nominated supervisor must comply with the requirements of s 33C (6) which restricts who could be the supervisor and would presumably require the approval of the respondent. That would at least require some time to organise if it was at all possible. 3. The Commissioner also submits that the cancellation of the licences does not prevent the applicants from having the outstanding defects remedied as the applicants may engage others to undertake those works. In the context of the findings in the Nassif and Toplace decision, the Commissioner submits that the applicants' conduct indicates that they cannot and should not be attending to the repairs and that the rectification should be done by others appointed to attend to the defects. 4. Engaging new contractors to undertake the rectification works would at least require some time, presuming it could be done at all. The process would cause at least some inconvenience, delay and disruption to the rectification work currently on foot. That inconvenience and delay would be further exacerbated by the fact that some of the rectification work involves rectification to defects involving water ingress which could cause considerable issue for those living in those premises. Given that I have found that the cancellation would result in a financial impact to Toplace Pty Ltd, there is also some risk that Toplace Pty Ltd may at some point find itself in a position unable to finance the rectification work at all. I accept there will at least be some adverse effect on the ability of Toplace Pty Ltd to continue with the rectification works presently on foot. Public Interest 1. The Commissioner submits that the decisions should be maintained in the public interest for the following reasons: * the protection of the public * To stay the decisions would undermine public confidence in the building industry. * The Toplace and Nassif decisions have been necessary to safeguard and protect the community. 1. The applicants submit that the Residential Apartment Buildings (Compliance & Enforcement Powers) Act 2020 (NSW) (RAB Act) bears upon whether the public interest requires that a stay should be granted in the present case. Part 2 of the RAB Act empowers the Secretary of the Department of Customer Service to issue a prohibition order preventing the issue of an occupation certificate for a residential apartment building, including where the Secretary is satisfied that a serious defect exists (s 9). Part 3 grants investigation powers in relation to residential apartment buildings. Part 5 provides for orders to be made requiring rectification of building work, including where the Secretary has a reasonable belief that building work may result in a serious defect or a residential apartment building has a serious defect (s 33). According to the affidavit of Mr Wee the Secretary has utilised the powers under the RAB Act in relation to Toplace Pty Ltd previously. Further, the applicants submit it is necessary to consider the interests of other consumers, in particular those purchasers who have entered contracts for the sale of land on the current developments and those that have entered into deeds and arrangement for the rectification of defects on past projects. Prospects of success 1. The applicants challenge the findings that were made against them in the reasons for the Nassif and Toplace decisions and submit that they will be obtaining independent expert evidence to challenge those findings. They submit that Toplace Pty Ltd will lead expert evidence about the status of the matters alleged to be defects having been unable to do so in response to the show cause notices which is likely to show that many of the alleged defects either never were or are no longer defects. Mr Wee has also made similar statements in his affidavit. 2. Further, the applicants submit, that even if some breaches of statutory warranties were able to be demonstrated, that did not justify the licence cancellation and disqualification which are the most extreme penalties available under the Home Building Act. 3. The Commissioner relies on the findings of an investigation and various audit reports in respect of Toplace Pty Ltd and Mr Nassif, which have revealed serious defects and breaches. The Commissioner also submits that the findings of serious defects by the respondent are the central pillar of the decisions and that the scope of the rectification work that has been required on previous projects is demonstrative of the high risk the applicants pose in relation to building works. Conclusion 1. Having considered the matters referred to in s 60(3) of the Administrative Decisions Review Act, I consider it desirable to make the orders staying the Toplace and Nassif decisions, to secure the effectiveness of the determination of the applications. I have considered the submissions made by the parties and have found that the decisions will affect the interest of: 1. The applicants, specifically arising out of breach of present finance facilities, purchase contracts and deeds and arrangement which Toplace Pty Ltd or its associated special purpose vehicles have entered. If the decisions take effect, it will have a detrimental financial effect on Toplace Pty Ltd and its ability to continue to operate. 2. Parties to contracts presently exchanged in relation to the current developments and those who are parties to deeds and arrangements for rectification works on past projects. 3. Employees of Toplace Pty Ltd and subcontractors presently engaged on current projects and for rectification works. 1. I am also mindful of the size and scope of the developments presently on foot and the number of people that the Toplace and Nassif decisions will affect. 2. The Tribunal proceedings are administrative review proceedings, where the Tribunal's power is that conferred by s 63 of the Administrative Decisions Review Act and the task of the Tribunal will be to decide what is the "correct and preferable decision" having regard to any relevant factual material and the applicable law. 3. This is only an interim application, the evidence in relation to the Nassif and Toplace decision has not yet been provided, challenged or conclusively examined by the Tribunal. There will need to be in this case, an evaluation of the seriousness of the alleged breaches and the evidence overall. At this stage of the proceedings, it is not possible to conclusively determine whether there is a proper basis for findings that the breaches occurred or whether the applicants are guilty of improper conduct or not fit and proper persons to hold a licence. 4. In relation to the public interest, I am satisfied that the powers under the RAB Act, to some degree, counterbalance any potential harm that may be done to prospective purchasers for the current projects. I accept the submission of the applicants, that the applicants remain under some scrutiny in relation to the building works and the RAB Act provides a range of powers to ensure the building work is done to standard. 5. However, to further limit any potential damage to the wider public interest, I have decided to impose a condition on the stay orders. The applicants submitted that while s condition was not necessary, it was open to the Tribunal to stay the decisions on condition that the applicants do not enter new contracts to undertake building works. Given the extent of the defects that are alleged against the applicants, the time that it may take for these matters to be finalised and the possibility that the applicant may be ultimately unsuccessful in these review applications, I am of the view that such a condition should be imposed to protect the public interest. Orders 1. Accordingly, I make the following orders: In matter 2022/00375413: 1. The decision of the Commissioner for Fair Trading, made on 2 December 2022, to cancel Jean Khazen Nassif's supervisor certificate No. 21450S and disqualify him from holding any authority under the Home Building Act 1989, is stayed until determination of the application to review the decision (filed 13 December 2022) on condition that: Jean Khazen Nassif will not enter into any further contracts to do residential building work without the consent of the respondent or leave of the Tribunal In matter 2022/00375423: 1. The decision of the Commissioner for Fair Trading, made on 1 December 2022, to cancel Toplace Pty Ltd's contractor licence No. 215731C and disqualify Toplace Pty Ltd from holding any authority under the Home Building Act 1989, is stayed until determination of the application to review the decision (filed 13 December 2022) and on condition that: Toplace Pty Ltd will not enter into any further contracts to do residential building work without the consent of the respondent or leave of the Tribunal. ********** I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales. Registrar I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales. Registrar DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 11 January 2023