Civil and Administrative Tribunal New South Wales Medium Neutral Citation: Angel's Paradise Wagga Pty Ltd ATF The APW Business Trust v Secretary, Department of Education [2025] NSWCATAD 5 Hearing dates: 17 December 2024 Date of orders: 17 December 2024 Decision date: 06 January 2025 Jurisdiction: Administrative and Equal Opportunity Division Before: L Andelman, Senior Member Decision: The application for a stay is dismissed. Catchwords: STAY – administrative review of decision to suspend approval to operate childcare centre – principles relevant to a stay Legislation Cited: Administrative Decisions Review Act 1997 (NSW) Children (Education and Care Services) National Law (NSW) Civil and Administrative Tribunal Act 2013 (NSW) Education and Care Services National Regulations Cases Cited: Bentran Pty Ltd v Sabbarton [2014] NSWCATAP 37 DBU v Secretary, Department of Education [2017] NSWCATAD 257 Texts Cited: None cited Category: Procedural rulings Parties: Angel's Paradise Wagga Pty Ltd (Applicant) Secretary, Department of Education (Respondent) Representation: White Knight Lawyers (Applicant) Crown Solicitor (Respondent) File Number(s): 2024/00431860 Publication restriction: Nil REASONS FOR DECISION 1. The applicant seeks a stay of a decision made by the respondent of 5 September 2024, suspending the applicant's approval to operate a childcare centre with immediate effect for a period of 6 months. I refused the stay application at the hearing. These are my reasons for the Order. 2. The applicant sought an internal review of the decision made on 5 September 2024 and the respondent's decision was confirmed on 21 October 2024. By the time the matter was before the Tribunal, the childcare centre had been closed for some three and a half months. 3. The decision made on the 5 September 2024 was made immediately following a compliance and monitoring visit on the same day. The compliance and monitoring visit was conducted because the respondent was concerned about child safety at the centre on 13 and or 14 August 2024. The concerns were raised based on a complaint made by a parent whose child suffered an injury that required medical attention. 4. The respondent's decision to immediately suspend the applicant's approval to operate a child care centre was made pursuant to s 73 of the Children (Education and Care Services) National Law (NSW) ("the National Law"). The applicant complied with the decision. The National Law 1. The National Law is part of the national scheme for the regulation of the education and care of children. 2. The objectives and guiding principles of the National Law are set out in s 3. Section 3(2)(a) identifies safety, health and wellbeing of children attending education and care services as one of the objects and guiding principles of the National Law. 3. The guiding principles of the national education and care services quality framework are set out in s3(3) as follows: (a) that the rights and best interests of the child are paramount; (b) that children are successful, competent and capable learners; (c) that the principles of equity, inclusion and diversity underlie this Law; (d) that Australia's Aboriginal and Torres Strait Islander cultures are valued; (e) that the role of parents and families is respected and supported; (f) that best practice is expected in the provision of education and care services. 1. The National Law provides, in s 4 that the respondent is to "exercise its functions having regard to the objectives and guiding principles of the national education and care services quality framework set out in section 3." 2. Section 73 of the National Law permits the respondent to suspend the service approval of a childcare centre without giving it a show cause notice "if it is satisfied that there is an immediate risk to the safety, health or wellbeing of a child or children being educated and cared for by the childcare centre." 3. The Tribunal's jurisdiction with respect to a review of a decision to suspend approval to operate a childcare centre is a review of a decision identified in s 192 of the National Law. Section 192 requires the Tribunal to conduct an "administrative review" of the decision made by the respondent. 4. In reviewing such a decision, the Tribunal is exercising its general jurisdiction in s 29 of the Civil and Administrative Tribunal Act 2013 (NSW) ("CAT Act") and not the jurisdiction to review derived from the Administrative Decision Tribunal Act (NSW) 1997 ("ADR Act"); DBU v Secretary, Department of Education [2017] NSWCATAD 257 at [22]. 5. Section 193 of the National Law permits the Tribunal to exercise powers as an entity, within the meaning of s 4 of the National Law. It follows that in exercising its jurisdiction to consider a stay application, the Tribunal is doing so pursuant to s 43(3) of the CAT Act and not s 60 of the ADR Act. Section 43(3) of the CAT Act states: (3) The Tribunal may make such orders (whether with or without conditions) staying or otherwise affecting the operation of a decision to which a pending general application or appeal relates as it considers appropriate to secure the effectiveness of the determination of the application or appeal. Applicable principles 1. The principles applicable to an application for a stay pursuant to s 43(3) of the CAT Act was set out in Bentran Pty Ltd v Sabbarton [2014] NSWCATAP 37 ("Bentran") at [9]: As a result of the use of "may" in s 43(3) of the Act, the Tribunal has a discretion whether or not to grant a stay. That discretion must be exercised judicially and general principles which apply in relation to the exercise of that discretion can be derived from the terms of s 43(3) itself. Additional guidance can be obtained from the considerations applied by the Courts in deciding whether or not to grant a stay pending an appeal. The applicable principles can be summarised as follows: (1) Generally a successful party is entitled to the benefit of the decision or orders that the party has obtained at first instance, but a stay may be granted where the appellant has demonstrated an appropriate case to warrant the exercise of discretion in its favour - s 43(2) and (3) of the Act. (2) In practical effect the onus is on an applicant for a stay to make out a case that it is appropriate for the court to make such an order. (3) The mere lodgment of the notice of appeal is insufficient, of itself, to demonstrate that it is an appropriate case to warrant the granting of a stay - s 43(2) and (3) of the Act. (4) An order staying the operation of a decision or orders will generally be appropriate where such an order is reasonably necessary to secure the effectiveness of the appeal - s 43(3) of the Act. This is similar to, if not the same as, the considerations applied by the Courts that where there is a risk that an appeal will prove abortive if the appellant succeeds and a stay is not granted or where unless a stay is granted an appeal will be rendered nugatory, the discretion should generally be exercised in favour of granting a stay. (5) The Tribunal may also take into account the strength or otherwise of the case of the party seeking the stay. This consideration may be particularly relevant when it is plain that an appeal, which does not require leave, has been lodged without any real prospects of success and simply in the hope of gaining a respite against immediate execution of the decision. (6) The Tribunal's power to grant a stay includes a power to make such an order subject to such conditions as the Tribunal specifies - ss 43(3) and 58 of the Act. (7) In exercising the discretion the Tribunal will also weigh the balance of convenience and the competing rights of the parties and may impose appropriate conditions so as to achieve a result that is fair to all parties. (8) Finally, the overriding principle in an application for a stay is to ask what the interests of justice require (citations omitted). Background to the suspension decision 1. The applicant relied on the affidavit of John Tanios, with annexures, the sole director and corporate trustee of the applicant and written submissions filed on 2 December 2024. 2. The respondent relied upon an affidavit of Amanda Anderson, a bundle of documents and written submissions filed 9 December 2024. 3. Ms Anderson is a Senior Field Officer employed by the respondent. She has significant experience of working in early childhood education as an educator, manager and in numerous compliance and quality assurance roles. 4. Ms Anderson and another employee of the respondent watched CCTV footage for 13 and 14 August 2024 for two rooms within the childcare centre. As stated above, the respondent received a complaint from a parent of a child referred to as AB. The parent asserted that child AB was injured at the childcare centre on 13 or 14 August 2024. 5. On 27 August 2024 in response to a request from the respondent for the CCTV footage for 13 to 15 August 2024, Mr Tanios emailed the respondent to advice that he had watched the footage for 13 August and that he did not observe AB having been involved in any incident or altercation from the time of his arrival at 6am to until he was collected at 5pm. Mr Tanios indicated that he was prepared to provide a sworn statement confirming this information and 30 minutes of footage, which he suggested would be sufficient for the respondent to close the investigation. 6. Ms Anderson stated that she observed an incident at about 10.50am on 13 August 2024, where AB attempted to climb on a home corner cupboard and fell on his left side. After that incident AB was distressed and crying and otherwise asleep until he was collected at 5pm. AB was not provided with first aid. AB was placed in a highchair and not actively supervised or comforted for about 20 minutes. 7. Ms Anderson at paragraph 19 of the Affidavit also stated that she formed a view that there were numerous other instances of noncompliance with the National Law and Education and Care Services National Regulations ("the National Regulations"), including children eating scraps of food of the floor, children not secured in high chairs, children being placed in high chairs for behaviour management purposes, children being left unsupervised for periods of time, including when engaging in dangerous activities such as climbing onto chairs tables and shelves. Educators were observed as sharing food with children, not supervising children while eating, holding discussions to resolve conflict and educators crying while working directly with children. Educators using their phones while supervising children and a child being left in a highchair up to 50 minutes. An educator was observed to grab a child under their right arm pit and being pulled, pushed on the forehead, a wrist grabbed and pulled. 8. On 5 September 2024, Ms Anderson together with another employee of the respondent attended on the applicant at about 1.30pm. they observed that the Responsible Person for the Service was not signed into the centre. During interviews with staff it was identified that one did not know that she was a mandatory reporter, did not hold a working with children check and had not commenced any formal training in early childhood education. 9. Ms Anderson communicated with the acting Manager of Compliance and Investigation, who informed Ms Anderson that together with other executive members at the Regulatory Authority that there was an immediate risk to the safety, health or wellbeing of children and actioned an immediate suspension of the centre. 10. Ms Anderson's evidence was that the decision to suspend the service approval was made following a history of non-compliance with the National Law and National Regulations. She considered that several breaches were serious and "indicative of substantial and ongoing risk to the health, safety and wellbeing of children. She identified the greatest concerns as being: 1. Non reporting of child protection concerns. 2. lack of awareness of mandatory reporting requirements. 3. infants placed in highchairs as a form of behaviour management. 4. educators WWCC checks not being verified with one of these having no evidence of application for WWCC. 5. infants placed in highchairs for extended periods of times. 6. infants standing on chairs and tables with no redirection from educators. 7. infants eating food scraps off the floor and lack of general hygiene 8. infants being repeatedly left alone in play spaces unsupervised. 9. infants left restricted in sleeping bags for extended periods while not sleeping. 10. infants left unattended in highchairs while eating. 11. educators moving infants by holding their wrists and swinging them forward. 12. the child AB being left to sleep on the floor with a cushion and not being checked for a period of at least 50 minutes despite him displaying signs of distress. 13. infants drinking bottles unsupervised while lying on pillows. 14. infants left in bounces and not strapped in and as a result having falls. 15. unqualified staff or educators that were not actively working towards their qualifications being left alone in the room with children counted in ratios. 16. infants accessing the fridge independently. 17. educators allowing children to drink from their personal drinks after they have drunk from them themselves. 18. educators holding discussions to resolve conflict and becoming distressed while working directly with children. 19. the nominated supervisor and lead educators modelling inappropriate behaviour and not addressing poor practise. 20. educators sitting on tables and shelves at times while children are also climbing them. 21. personal phones being used within rooms including to take photos of children. 22. educators not being given an induction which included any review of policies and procedures. 23. educators not having any training on adequate supervision risk management child protection or the Child Safe Standards. The applicant's evidence and submissions 1. The applicant broadly refuted the allegations in regard to child AB. The refutal was contained in a document the applicant provided to the respondent for the purpose of the internal review of the decision to suspend the applicant's approval to operate a childcare centre. The applicant stated that staff using mobile phones while educating children is a breach of the policy and new measures would be implemented. In regard to the other allegations, the applicant acknowledged that children were eating food of the floor and suggested a change to procedure. Induction, onboarding and insurance of knowledge of policies was being reconsidered. The applicant admitted that the comments made by Ms Johns were deeply disturbing. Ms Johns indicated that she would be resigning her employment. 2. Mr Tanios did not address any of the specific allegations in his affidavit. At paragraph 25, he stated that he denied those grounds founding the suspension decision. 3. Mr Tanios stated that the childcare centre was funded and financed by trading income, capital by him and his wife, banking finance on which the applicant pays interest and that he personally guarantees. 4. Mr Tanios was at the time of swearing the affidavit finalising the property distribution with his ex-wife. Mr Tanios and his ex-wife were equal business partners for the applicant and two other childcare centres. 5. Mr Tanios believed that the applicant could become financially distressed if not insolvent and the business of the applicant lost within about one or two months from 29 November 2024 if the stay order was not granted. He is currently refinancing his home mortgage and trying to obtain debt to continue funding the applicant. His refinance application is not yet approved. 6. In the documents, Mr Tanios stated that he never intended to mislead the Department in regard to child AB and on further review and reflection recognised that his assessment "may not have fully captured all the nuances of the situation." 7. In evidence were prior assessments and rating conducted by the respondent. Both parties relied on these assessments. The applicant submitted that it passed the assessments and the respondent relied on the number of ratings the respondent did not meet such as health, hygiene and safe food practices and protection of children from harm and hazards. 8. The applicant's documents revealed that the centre generated about $6000 per week as gross profit. Since 5 September 2024, the staff were not being remunerated but fixed costs such as rent was required to be paid. There was some evidence before the Tribunal that Mr Tanios has not paid some of the rent owing on the premises and the landlord has taken some steps to end the lease arrangements. 9. The profit and loss statement as at 30 June 2024 showed that the centre made a net profit of over $371 000. Mr Tanios stated that he had $1000 in the bank, although no bank statements were provided. 10. In evidence is a document which may be a screen shot that shows that on 15 November 2024, about $20 000 was withdrawn from the home loan. It was submitted that these amounts were withdrawn for the purpose of financing the applicant's financial obligations such as the rent and that Mr Tanios is struggling to pay the fixed expenses and his home mortgage. 11. The applicant submitted that the stay should be granted because there are no immediate or potential risks to the safety, health and wellbeing of children. The applicant wished to retain the services of an independent consultant and submitted that it would adopt all the recommendations made. 12. The applicant also submitted that the applicant will likely become insolvent within months and before the Tribunal determines the matter "all things being equal". Consideration 1. In considering the factors set out in Bentran, I do so within the statutory context of the decision subject to the application for review and the objectives and specifically the guiding principles of the National Law, which are set out in s 3. 2. It is generally the case that the respondent should be taken to be entitled to the benefit of the decision at first instance unless the applicant can demonstrate that it is appropriate to grant a stay of the decision made. Is a stay reasonably necessary to secure the effectiveness of the substantial decision? 1. The applicant's submissions that if the stay was not granted the childcare centre would not continue to operate were largely unsupported by documentary evidence. There was no evidence of assets or income, bank statements or mortgage accounts. There was no evidence from an accountant or any other person in regard to the solvency of the applicant of the likely future insolvency. 2. I accept that the applicant since 5 September 2024 has lost $6000 of gross profits per week which had made it difficult to pay fixed expenses such as rent while the centre is not operating. I accept that Mr Tanios is seeking to refinance his home mortgage. There was some evidence to suggest that regardless of whether a stay was granted, the landlord had taken steps to terminate the lease. 3. The applicant's submission that the net profit of some $371 000 in 2024 should not be considered because there is no evidence as to whether it has been spend is misguided as the onus rests on the applicant to satisfy the Tribunal that a stay should be granted as it is reasonably necessary to secure the effectiveness of the substantive decision. 4. I am not satisfied that Mr Tanios does not have sufficient funds for the applicant's fixed costs. I am not satisfied that the applicant is likely to become insolvent if the stay is not granted. 5. The applicant has not demonstrated that a stay is necessary to secure the effectiveness of the final hearing, which was set down for February 2025, prior to 5 March 2025, which is the date on which the suspension decision ceases. The strength of the applicant's case 1. I consider that the applicant's case is not hopeless and there is a contest between the parties as to whether there was on 5 September 2024 an immediate risk to the safety, health or wellbeing of a child or children being educated and cared for by the applicant. 2. Much will rest on the consideration of the CCTV footage taken on 13 and 14 August 2024 which was not before the Tribunal. Balance of convenience 1. I have taken into consideration the fact that the centre has been closed for some three and a half months and the stay will have no immediate impact on a significant number of families and many children who are receiving care elsewhere. 2. There was no evidence as to whether the educators have been employed elsewhere, or are seeking to return to work for the applicant. 3. On the information before me, I am not satisfied that the operation of the service could be addressed on an interim basis by the imposition of conditions such as the engagement of a consultant. Such a step was open to the applicant for the last three and half months and has not been taken up. The submission that the applicant would accept all recommendations made by the consultant is entirely hypothetical as it is unknown when the recommendations would be made or what the recommendations may encompass. 4. I am not satisfied that in these circumstances consistent with s 3(a) of the National Law that the balance of convenience favours the granting of the stay. There are far too many serious alleged breaches. The unacceptable risk to the health wellbeing and safety of the child can best be protected by refusing a stay. Public Interest 1. The public has an interest in the availability of childcare which complies with the National Law. Safety, health and wellbeing of the children are paramount considerations. 2. I accept that the respondent's concerns are very serious, ongoing and well documented. I do not accept the applicants' contention that the respondent is a "hyper vigilant" regulator that has over overreacted. 3. Nor do I accept the applicant's submission that there is no ongoing risk to the health and safety of children at the centre. Conclusion 1. Given my findings, I am not satisfied that the applicant has demonstrated that it is appropriate for the Tribunal to grant a stay. Orders 1. My order is as follows: 1. The application for a stay is dismissed. ********** 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: 06 January 2025