Lindfield v Director General, Office of Fair Trading [2004] NSWADT 8

Set aside by Appeal : Decision set aside by appeal on 30 June 2004.

CITATION: Lindfield v Director General, Office of Fair Trading [2004] NSWADT 8 DIVISION: General Division APPLICANT PARTIES: Matthew William Lindfield RESPONDENT Director General, Office of Fair Trading FILE NUMBER: 033202 HEARING DATES: 18/09/2003 SUBMISSIONS CLOSED: 09/18/2003 DATE OF DECISION: 01/15/2004

BEFORE: Higgins S - Judicial Member APPLICATION: Home Builder - suspension of contractor licence - Home Building Act - home builder - suspension of contractor licence MATTER FOR DECISION: Principal matter Administrative Decisions Tribunal Act 1997 LEGISLATION CITED : Consumer, Trader and Tenancy Tribunal Act 2001 Home Building Act 1989 Harb v Commissioner of Fair Trading [2003] NSWADT 185 CASES CITED: Hughes & Vale Pty Ltd v The State of New South Wales (No.2) 93 CLR 127 Maurice Neville Hinchcliffe v Building Services Corporation (24 July 1997) APPLICANT REPRESENTATION: M Manwaring, solicitor RESPONDENT T Grey, solicitor ORDERS: The decision of the Director General is set aside

BACKGROUND 1 Matthew William Lindfield ("Lindfield") has made an application seeking review of a decision made by a delegate of the Director-General, Office of Fair Trading ("Director-General") under Part 4 (disciplinary proceedings) of the Home Building Act, 1989. Mr Lindfield is the holder of a contractor's licence under the Home Building Act, 1989. Pursuant to that licence Lindfield is authorised to enter into contracts for home building plumbing work. 2 The factual basis on which the Director-General made his decision, pursuant to the disciplinary proceedings under the Home Building Act, 1989, emanated from a decision on 4 December 2000 of the then Fair Trading Tribunal ("FT Tribunal") in which Lindfield was ordered to undertake specified rectification work on a plumbing contract he had entered into with a Mrs Joan Barnett. After these orders were made, Mrs Barnett brought the matter back before the FT on 26 June 2001. Lindfield did not attend that hearing. On this day, the FT Tribunal ordered that Lindfield pay $6,223 to Joan Barnett by 26 July 2001. It was Lindfield's conduct in respect of the payment of this amount which was the basis on which the Director-General based his decisions. 3 The decisions made by the Director-General pursuant to the disciplinary proceedings provisions of Part 4 of the Home Building Act, 1989 were as follows: "(a) Lindfield was guilty of improper conduct; (b) Lindfield was not a fit and proper person to continue to hold a licence; (c) In so far as Lindfield was guilty of improper conduct, the following disciplinary action had been decided to be taken; (i) the contractor licence held by Lindfield was to be suspended for a period of four months, effective from 20 August 2003; and (ii) Lindfield was required to pay a penalty, the amount of $1,500 within a period of 28 days. (d) In so far as Lindfield was found to be not fit to hold a contractor licence, his contractor licence was to be cancelled and he was disqualified for a period of one year, effective from 20 August 2003, from being any of the following: (i) the holder of any authority, (ii) a member of a partnership, or an officer of a corporation that is a member of a partnership, that is the holder of an authority, and (iii) an officer of a corporation that is the holder of an authority". 4 Lindfield lodged his application with the Tribunal on 21 July 2003 and at the same time made an application for an urgent stay of the Director-General's decision. The application for an urgent stay was heard on 24 July 2003 and the Tribunal granted a stay pending the hearing of the matter. That stay was then extended to the date on which Lindfield's application was determined. 5 The Tribunal has jurisdiction to hear and determine this matter pursuant to s.83B(3)(a) of the Home Building Act, 1989 and s.38 of the Administrative Decisions Tribunal Act, 1997. Legislation 6 The Home Building Act, 1989 ("the Act") makes provision for the regulation of residential building work and specialist work. Part of this regulative scheme is the provision of licences and certificates to do such work. Section 4 of the Act provides that a person is prohibited from contracting to do residential building work or specialist work on behalf of an individual, partnership or corporation unless that person is the holder of a licence authorising that person to contract to do that work. 7 Section 56 of the Act specifies the grounds upon which the Director-General may take disciplinary action against the holder of a contract licence. So far as is relevant to this application this section provides as follows: "s.56 The Director-General may take disciplinary action under s.62 against the holder of a contractor licence on any of the following grounds: (a) that the holder is not entitled to hold the contractor licence, (b) that the holder is not fit to hold the contractor licence, (c) that the holder is guilty of improper conduct, and (d)…. (e)…. (f)…." 8 The circumstances which constitute "improper conduct" for the purposes of s.56 of the Act are defined in s.51. So far as is relevant to this application, the section provides as follows: "s.51(1) A holder of a licence who is authorised by the licence to contract to do residential building work or specialist work, or a holder of a supervisor or tradesperson certificate, is guilty of improper conduct if the holder: (a) commits an offence against this Act or the regulations, whether or not an information has been made for the offence, or (b) in the course of doing any work that the licence or certificate authorises the holder to do, fails to comply with a requirement applicable to the work made by or under this or any other Act in respect of the work or (c) breaches of statutory warranty, or (d) in the case of specialist work, does the work otherwise than in good and workmanlike manner or knowingly uses faulty or unsuitable materials in the course of doing the work. (1A)… (2) The holder of a licence is guilty of improper conduct if the holder: (a) Without reasonable cause, breaches a contract to do any work that the licence authorises the holder to contract to do or, (b)…. (c) does not comply with an order of the Tribunal". 9 One term "Tribunal" is defined in s.1 of the Act to mean the Consumer Trader and Tenancy Tribunal. Prior to this Tribunal coming into operation the section defined "The Tribunal" to be the Fair Trading Tribunal. 10 Where the Director-General is satisfied that there are reasonable grounds for believing that there are grounds for taking disciplinary action under Part 4 of the Act, s.61 provides for the issue of a show cause notice by the Director-General. That section also makes provision for the licence holder, the subject of the show cause notice, to make submissions in response within a specified period. 11 After issuing a show cause notice and receiving a response thereto (if any), s.62 of the Act provides that where the Director-General is satisfied that any ground on which disciplinary action may be taken against the license holder has been established, the Director-General may do any one or more of the following: (a) determine to take no further action against the holder; (b) caution or reprimand the holder; (c) make a determination requiring the holder to pay to the Director-General, as a penalty, an amount not exceeding $11,000 (in the case of an individual) or $22,000 (in the case of a corporation) within a specified time; (d) vary the authority held by the holder, by imposing a condition on the authority including a condition requiring the holder to undertake a course of training relating to a particular type of work or business practice within a specified time, (e) suspend the authority for a period not exceeding its unexpired term; (f) cancel the authority; (g) disqualify the holder, either temporarily or permanently from being anyone or more of the following: (i) the holder of any authority, or any specified kind of authority, (ii) a member of a partnership, or an officer of a corporation that is a member of a partnership, that is the holder of an authority, (iii) an officer of a corporation that is the holder of an authority". 12 The term "authority" is defined in s55 for the purpose of ss 55 to 69 of the Act to include a contractor's licence. Evidence 13 Mr Manwaring, on behalf of Lindfield, tendered into evidence an affidavit sworn by Lindfield on 2 September 2003 ("Lindfield's affidavit"). In addition to this he called Lindfield to give oral evidence and he was cross examined by Mr Grey, on behalf of the Director-General. 14 Mr Manwaring also relied on the statutory declaration made by Lindfield on 8 May 2003; the statutory declaration of his father, Paul Francis Lindfield, made on 8 May 2003 and the character references that were tendered on 24 July 2003 for the purposes of Lindfield's stay application. The character references were from the following persons: - Richard Nagy, a local builder who has known Lindfield for the past 8 years and for whom Lindfield has done numerous plumbing jobs, dated 22 July 2003. In the reference Mr Nagy states that he has never had any problems with Lindfield's tradesmanship and that he has always been reliant and efficient on all the projects he has been asked to work on. - Richard White, Director of Central West Homeworld Pty Ltd, dated 23 July 2003. Mr White makes reference to the fact that Lindfield had his contractor licence cancelled or suspended as a result of an incident that in his view should not have arisen. He states that his company has engaged Lindfield's firm to complete plumbing work on several buildings they were constructing. During the time that they have engaged Lindfield's firm there has never been an issue over cost, standard of work, call back or indeed anything at all. - Steven Coles, Building Supervisor and Estimator, Central West Homeworld Pty Ltd, undated. Mr Coles makes reference to the fact that the Director-General had decided to cancel or suspend Lindfield's contractor licence. He states that in his view Lindfield is suitable to hold a contractor licence. He has found Lindfield's work to be of a high quality and call backs have been rare. He goes on to state that when Lindfield has been requested to do a call back he has been both punctual and willing in all circumstances. He also states "We have found that Matt has improved our Business in both the Quality of his work and the fact that his contracts on our home are completed on time. We believe from our dealings with Matt that he is both honest and sincere in his Business dealings with us and we sincerely hope that he can retain his Contractor's Licence". 15 Mr Grey, on behalf of the Director-General, tendered into evidence a folder of documents which included the abovementioned statutory declarations, investigator's reports, the show cause notices, the decisions of the Director-General and other relevant material. He also tendered into evidence a copy of the completed proforma affidavit as to property and means, sworn by Lindfield on 24 April 2002 in support of his application to pay the judgment debt ordered by the Tribunal on 26 June 2001 by the FT Tribunal. 16 The evidence discloses the following sequences of events: (a) After completing his apprenticeship in 1995, Lindfield obtained his contractor licence on or about 25 June 1997. Since completing his apprenticeship he estimates that he has completed approximately more than 15,000 jobs. These jobs range from menial tasks like changing the washer in a tap or fixing cracked pipes to major commercial plumbing fit outs. Since 1999, Lindfield has operated his own firm and employs two apprentices and one or two holders of a supervisors certificate under the Act. These personnel have been employed as the need arose. (b) On or about 18 April 2000 Lindfield entered into a contract with Mrs Barnett, an elderly lady, to do some drainage work in the driveway of her home. The cost of that work was $1,500. When this work was actually carried out is not very clear. In his affidavit, Lindfield states that he undertook this work in about August/September 2000. Yet there is an unsigned letter by Mrs Barnett, dated 27 September 2000, addressed to Lindfield which makes reference to this work commencing at the end of April 2000. During the course of evidence it was never put to Mr Lindfield that he in fact received the original of this letter, a copy of which was forwarded to the then Department of Fair Trading and retained in the Department's file. The Department is now an office within the Department of Commerce ("the Department"). (c) On or about 24 August 2000, Mrs Barnett lodged a complaint with the Department. She was subsequently advised that she was required to notify Lindfield of her concerns. The file notes of an officer of the Department, which are contained in the folder of documents tendered into evidence by Mr Grey, indicate that Mrs Barnett contacted the Department after receiving the letter advising her to contact Lindfield. The file note of that conduct indicates that Mrs Barnett was abusive and difficult to deal with. It also indicates that Mrs Barnett's recollection of events such as the date on which she lodged her complaint was far from precise. (d) On 15 November 2000, Mrs Barnett lodged a claim against Lindfield with the FT Tribunal. The matter was heard on 1 December 2000 and the Tribunal ordered that Lindfield was to remove all wet material from the trenches, replace such material with materials to be advised by Mr Onley, to scrape mud off driveway and to renew surface of driveway to minimise depth of 25mm from garage to end of excavation of Mrs Barnett's home. The Tribunal ordered that this work be undertaken, weather permitting, by 15 January 2001. In addition to these orders the Tribunal gave Mrs Barnett leave to renew the claim if the work was not done or not corrected. According to Lindfield's affidavit he undertook this work under the supervision of Mr Onley, who was the person nominated by Mrs Barnett to supervise the work. Furthermore, Mr Onley wrote on the notice of the order stating that the work was completed to his satisfaction within the due date. On or before 4 June 2001, Mrs Barnett exercised her right for leave to renew her claim. That claim was heard on 26 June 2001. Lindfield was given written notice of the hearing by the FT Tribunal, however he had concerns about attending as Mrs Barnett had sought and obtained an interim apprehended violence order against him on 12 April 2001. That order was extended by the Local Court at Orange on 14 June 2001. In his affidavit, Lindfield states that when he contacted the FT Tribunal he was informed that the Tribunal would get back to him. He then goes on to state that he received no further information from the Tribunal. There is evidence which supports Lindfield's statement that he made contact with the FT Trading Tribunal (see below). (e) On 26 June 2001, the FT Tribunal ordered that Lindfield pay Mrs Barnett $6,223 by 26 July 2001. There is no evidence before this Tribunal as to the basis on which this order was made. On 16 July 2001, Lindfield lodged a re-hearing application with the FT Tribunal. In that application he stated "I could not attend the hearing because she had taken out an AVO upon me". Lindfield's application was refused and he was advised of this on or about 20 August 2001. In the reasons for decision the FT Tribunal stated that Lindfield had telephoned the Tribunal on 4 June 2001 to advise that he would not be attending the hearing as Mrs Barnett had taken out an AVO against him. The reasons go on to state that Lindfield was advised that the matter would still proceed and that he should attend. However, this Tribunal was not provided with the material on which such a finding was made. It only has the evidence of Lindfield, which is inconsistent with that stated in the decision. (f) On or about 17 August 2001 Mrs Barnett made an application in the Local Court at Orange to have judgment entered. This she appears to have done following advice from the Department. She also made an application for a writ of execution. Some time before 20 September 2001, the Sheriff at Orange attended Lindfield's home and attempted to execute the writ. It was at this stage that Lindfield sought legal advice for the first time. He was successful in obtaining an ex parte stay of the writ of execution pending the hearing of a Notice of Motion for a stay of the enforcement of the judgment. The Motion was subsequently granted and the enforcement of judgment was stayed until 9 November 2001, or further order of the Court. That Motion was subsequently struck out on 1 February 2002. (g) On 20 November 2001, on the advice of his solicitor, Lindfield signed a further re-hearing application with the FT Tribunal. That application was again refused and Lindfield's solicitor communicated with the FT Tribunal between 6 December 2001 and 6 February 2002. (h) Having received advice about the cost of appealing the decisions of the FT Tribunal, Lindfield decided not to pursue an appeal and on or about 24 April 2002, he made an application to the Local Court at Orange to pay the judgment debt by way of instalments at the rate of $40 per week. In support of his application, as mentioned above, Lindfield swore a one page pro forma affidavit as to property and means. In that affidavit he disclosed that he owned a van and that this van's current market value was $5,000. Lindfield's application was refused by the Registrar and this refusal was subsequently confirmed at a hearing on 31 May 2002. (i) On 18 October 2002, Lindfield attended an examination summons at the Local Court at Orange. The examination summons was conducted by the Registrar. In his affidavit, Lindfield states that when he was asked the question as to whether he owned or was purchasing a motor vehicle he responded to the following effect: "Yes, I have one vehicle, a Toyota Hius van registered number POWER1. I also have a Mitsubishi express vehicle registered number GDS-471. Both vans are subject to hire purchase to Esanda, about $6,000 owing on the Toyota and the Mitsubishi van about $4,500. I would estimate the value of the vehicles to be approximately $8,000 for the Toyota and the Mitsubishi about $6,000 to $7,000". (j) What Lindfield failed to disclose was the fact that on or about 14 June 2002, he had become the registered owner of a Porsche GT-3. (k) Following the examination summons Lindfield made some payments to the Local Court in defrayment of the debt. (l) On 9 January 2003, the Director-General issued a notice to show cause to Lindfield. According to Mr Lindfield he never received a copy of that notice. However, on 20 January 2003 he received a letter dated 16 January 2003 advising him that as a result of his failure to comply with the order of the FT Tribunal that he pay Mrs Barnett a sum of $6,223 on or by 26 July 2001 that this failure amounted to "improper conduct" under the Act. The letter also stated that in light of this the Department considered that his conduct may warrant the imposition of certain conditions being placed on his licence. He was given fourteen days to respond to the letter. In his affidavit, Lindfield states that on receipt of this letter he for the first time understood the seriousness of not complying with the FT Tribunal order and he therefore made every attempt to make the payment to Mrs Barnett. This he did, on 14 February 2003, after borrowing money from his father. Prior to this Lindfield also had had discussions with the Department in respect of the conditions that would be imposed on his contractor licence as set out in the Department's letter of 16 January 2003. On the following day, the Department wrote to Lindfield advising him that conditions had been placed on his licence as he had been unable to satisfy the Department that he had made the payment to Mrs Barnett. (m) On 18 February 2003, the Director-General issued a notice to Lindfield in which he stated that he had determined that Lindfield's contractor licence should be suspended for its entire term, that is, until 25 June 2003. That decision was subsequently revoked as it had been determined that the notice to show cause had not been properly effected upon Lindfield in order for him to be able to respond within the stipulated time. (n) On 28 February 2003, the Director-General issued a fresh notice to show cause to Lindfield pursuant to s.61 of the Home Building Act, 1989. In that notice the Director-General only relied on the grounds that Lindfield's conduct in failing to comply with the FT Tribunal's order to pay Mrs Barnett constituted "improper conduct" under s.51(2)(c) of the Act. In response to the show cause notice, Lindfield met with officers of the Department, at Parramatta, on 6 March 2003. According to a file note made by one of the Department's officers at that meeting, which was attached to Lindfield's affidavit, Lindfield explained that the delay in making the instalment application was as a result of legal advice that he had been receiving in regard to a possible appeal. He also went on to state that he did not understand the serious implications of failing to comply with an order of the FT Tribunal and that he would never let that happen again. In his opinion, any disciplinary action should be in the form of a warning as he had now learnt his lesson and would not offend in the future. (o) On 21 March 2003, the Director-General wrote to Lindfield asking him to answer certain questions. These questions included a question requesting Lindfield to explain why he had failed to refer to the 1999 Porsche Coupe during the examination summons on 18 October 2002 when he was asked to list the motor vehicles that he either then owned or was purchasing. In his response to that question Lindfield stated the following: "The reason it was not included was that it isn't mine. Its registered in my name and housed in my garage because the owner lives on a property and the car can't be driven down his road and he hasn't got enough room for it". (p) On 22 April 2003, the Director-General amended the notice to show cause to include the additional allegation of Lindfield not being fit to hold a contractor's licence. This finding was made following further investigations by the Director-General. In particular, the Director-General ascertained that the Porsche was valued at $227,000 and that Mr Lindfield was the sole purchaser of the vehicle, that he had traded his Holden Commodore valued at $85,041.23 to purchase the Porsche together with a commercial loan of $228,089. That loan was provided by AGC. (q) On 24 June 2003, the Director-General issued a notice of decision pursuant to s.64 of the Act. It is that decision which is the subject of this application. (r) On 21 July 2003, Lindfield lodged an application, with the Tribunal, for review of the Director-General's decision together with an application for a stay of that decision. (s) On 1 August 2003, another delegate of the Director-General completed an internal review of the earlier decision of the Director-General. The outcome of that internal review was that this delegate affirmed the earlier decision. (t) In his affidavit, Lindfield stated that he had failed to tell the Registrar of the Local Court, on 18 October 2002, that he was the part owner of a Porsche 911-GT3 motor vehicle, because he did not consider that he was in effect the owner of that motor vehicle as its value was entirely encumbered to the company that had financed his purchase of the vehicle together with the arrangement he had with his father in respect of the vehicle. In respect of the arrangement with his father, he stated that his father assisted in making payments for the vehicle, that he has liberty to use the vehicle whenever he wishes to do so and he knew that the vehicle could in no way be utilised as satisfying the payment of a debt owed to Mrs Barnett or any other creditor. As to the arrangements with his father, the statutory declaration of Mr Lindfield Senior supports what is contained in Lindfield's affidavit. In respect of his response to the question asked of him by the Director-General in his letter of 21 March 2003 concerning the motor vehicles that he either owned or was purchasing, Lindfield stated the following in his affidavit: "67. I disclosed that the car was registered in my name. The reference to the "owner" is a reference to my father. I did not want to reveal his name and have him brought into this matter. My father lives on a property and the car cannot get down the driveway to the property. Moreover, my father is an earthmoving contractor and has no room to store the car. 68. The car is in effect "owned" by Esanda. I cannot deal with it in any way without Esanda's permission. 69. I should have been more accurate with my response to the Office of Fair Trading and I accept that my answer is ambiguous. For that I apologise. I hurried my response and I did not seek advice. I should have not hurried my response and I should have sought advice. 70. In hindsight and on reflection I guess in my own mind I did not believe that the Tribunal had the right to ask me about my finances in circumstances such as these, particularly when the order that started the process had been paid. I was confused by the process and felt besieged by the Office of Fair Trading and I could not understand why. I felt I was being unfairly persecuted and I could not understand why. I felt my privacy was being breached and I could not understand why. 71. I apologise for not being more detailed in my response to the Office of Fair Trading and dealing more accurately with ownership of the Porsche." (u) During oral evidence Lindfield acknowledged that he had sold a Holden when purchasing the Porsche. That Holden was also of considerable value, but it was fully financed, giving Lindfield no profit. 17 Mr Manwaring on behalf of Lindfield submitted that when the conduct complained of is considered in its proper context, the Tribunal will be satisfied that the conduct is not sufficient to warrant the suspension or cancellation of Lindfield's contractor licence. In particular he made reference to the fact that Lindfield attended the initial hearing before the FT Tribunal, and that he complied with these orders that were made on this occasion as evidenced by the certifications of Mr Onley. He also submitted that in light of no contrary evidence, the reasons why Lindfield did not attend the second hearing should be accepted as his reasons were reasonable in the circumstances. He pointed out that the Tribunal had not heard from Mrs Barnett, nor did the Tribunal have before it the evidence relied on by Mrs Barnett at the rehearing before the FT Tribunal on 26 June 2001. Mrs Barnett had not been called to give evidence nor has the Tribunal been provided with a sworn statement or even a signed letter from Mrs Barnett. Furthermore, there is no evidence before the Tribunal as to the basis on which the FT Tribunal made its order that Lindfield pay Mrs Barnett a sum of $6,223. That is, there is no evidence before the Tribunal to indicate in what way the work undertaken by Lindfield was not of an adequate standard or in accordance with what he had contracted to provide. Indeed, on the basis of Mr Onley's certification, together with the references on which Lindfield relies, the evidence before the Tribunal is to the effect that the standard of Lindfield's work at Mrs Barnett's was satisfactory. 18 He also pointed out that the Tribunal should have regard to the fact that it was not until he had his application for a re-hearing refused that he sought legal advice. This advice was limited to endeavouring to obtain a re-hearing of the matter together with copies of the evidence on which the order had been made. 19 Mr Grey, on behalf of the Director-General, submitted that the Director-General's decision in respect of Lindfield having engaged in improper conduct was factually correct as Lindfield did not comply with the order within the time set down by the FT Tribunal. Accordingly, there was a proper basis on which the Director-General could take disciplinary action. 20 In respect of the Director-General's decision that Lindfield was not fit to be the holder of a contractor's licence, Mr Grey submitted that there was ample evidence to demonstrate that Lindfield had acted deliberately to frustrate Mrs Barnett being paid the amount he had been ordered to pay her. His actions, he alleged amounted to dishonesty and, Mr Lindfield only paid with the intervention of the Director-General. He further submitted that to the date of hearing Lindfield did not recognise he had acted dishonestly. Mr Grey also relied on the decision of Harb v Commissioner of Fair Trading [2003] NSWADT 185 in support of his contention that the Director-General's decision was correct. In my opinion, the facts in that case vary markedly from those in the present case. They were far more serious and involved fundamental breaches of the Act. Reasons & Decisions 21 The role of the Tribunal is to determine whether the Director-General's decision was the correct and preferred decision having regard to the relevant facts and the applicable law (see s63 of the Administrative Decisions Tribunal Act 1997). 22 There are three main issues in this matter. These are as follows: (a) is Lindfield guilty of "improper conduct" in that he failed to comply with an order of the FT Tribunal as set out in s51(1)(c) of the Act? (b) does Lindfield's conduct establish that he is "not fit" to hold a contractor licence under the Act? And (c) if one or both of the abovementioned matters are satisfied, are the disciplinary action taken by the Director-General the appropriate action having regard to the circumstances. 23 While the Tribunal is not bound by the rules of evidence, the Tribunal has long accepted that these rules are to provide guidance as to what weight should be placed on the material that is put before the Tribunal in support of an application. Where that material is contradictory or conflicting, the Tribunal places greater weight on that evidence which is direct evidence as opposed to hearsay or non verified evidence. In this case, the Tribunal has only heard direct evidence from Lindfield. It did not receive any direct, sworn or otherwise signed evidence from the complainant, Mrs Barnett, nor did it receive any evidence on the basis on which the FT Tribunal made its orders on 26 June 2001. As mentioned above, it did however receive direct evidence from Lindfield and his father. Lindfield was cross-examined by Mr Grey, on behalf of the Director-General, and in my opinion, while some of Lindfield's responses to questions were not as clear as they could have been, he gave truthful evidence. Accordingly, where Lindfield's direct account of events differs to those contained in documents contained in the files of the Department, Lindfield's account was preferred. Improper conduct 24 I will first deal with the issue of whether Lindfield is guilty of "improper conduct". 25 There is no dispute, that Lindfield failed to pay Mrs Barrett as ordered by the FT Tribunal on 26 June 2001 by 26 July 2001. Accordingly, in a technical sense, there has been a failure to comply with the order of the FT Tribunal. As noted above, the amount ordered to be paid by the FT Tribunal was in fact paid some 18 months later. Notwithstanding this, there is an argument that Lindfield's failure to pay Mrs Barnett by the required day was sufficient to constitute improper conduct as defined in s51(2)(c) of the Act. On the other hand, that section must be read subject to licence holder's right of appeal against any order that is made. In this case, Lindfield exercised his rights of a re-hearing together with his right to make an application to pay the amount owing by way of instalments. The fact that he was ultimately unsuccessful in such applications does not alter the fact that he had a right to make them in the first place. 26 In my opinion, Parliament did not intend for s.51(1)(c ) of the Act to operate in a way which prejudiced a licence holder's rights of appeal. Had it intended to do so it would have expressly provided for such and it has not done so. 27 Accordingly, in my opinion, on the proper construction of s.51(1)(c) of the Act and having regard to the circumstances of this application, it cannot be said that Lindfield is guilty of "improper conduct" as set out in s.51(1)(c) of the Act. He clearly acted inappropriately in response to Mrs Barrett's attempt to enforce the order of the FT Tribunal, but this does not mean that he in fact breached the order. Fitness 28 Section 56(b) of the Act does not specify what is meant by the term "fit to hold a contractor licence". Nor is there a definition of this phrase for the purposes of the disciplinary provisions in Part 4 of the Act. 29 However, there is a reference to "fitness" for the purposes of an application for a contractor licence. The relevant section is section 19 of the Act. Subsection 19(1) provides for applications for such licences and subsection 19(2)(a) provides that an application for a licence is to be accompanied by particulars, as required by the Director-General, concerning "the fitness, ability and capacity of the applicant to carry out contracts for which the licence is required…". 30 Section 20 makes provision for the issue of licences by the Director-General. Subsection 20(2) of the Act provides that the Regulations may fix or provide for the Director-General to determine standards or other requirements that must be met before a licence of particular kind is issued. In this regard clause 19(1)(b)(v) of the Home Building Regulation provides that before a licence is issued, the Director-General must be satisfied that the applicant is a "fit and proper person to hold the licence and is otherwise of good character". 31 In Hughes & Vale Pty Ltd v The State of New South Wales (No. 2) 93 CLR 127 at 156 Dixon CJ, McTiernan and Webb JJ said the following, in relation to the purpose of the "fit and proper person" test: "…is to give the widest scope for judgment and indeed for rejection. "Fit" (or idoeneus) with respect to an office is said to involve three things, honesty, knowledge and ability: "honesty to execute it truly, without malice, affection or partiality; knowledge to know what he ought duly to do; and ability as well as estate as in body , that he may intend and execute his office, when need is, diligently, and not for impotency or poverty neglect it." (emphasis added). 32 It is widely accepted that this test is to be applied having regard to the object and purpose of the legislation in question. In this case, the purpose of the relevant Act is to regulate the residential building industry so as to protect consumers against defective and unsafe workmanship as well as protecting consumers from contractors who are dishonest in their contractual dealings with consumers. Accordingly, the Act requires the Director General, who is given the task of issuing the relevant authorities Act, to have regard not only to the persons ability to do the work but also his honesty and integrity in performing the tasks that the person is authorised to do. 33 As stated by the Commercial Tribunal in Maurice Neville Hinchcliffe v Building Services Corporation (24 July 1997) the holding of a qualified supervisor certificate is taken to be evidence that the person " can be held out to the public not as being not only possessed of acceptable building expertise but is a person of integrity and honesty." 34 In my opinion, on the material before the Tribunal, Lindfield's affidavit on assets and liabilities and his responses in the examination on 18 October 2002 before the Registrar of the Local Court were not full and frank. Even though, there was no equity in the Porsche he was under an obligation to make a full disclosure of what he owned and what he owed in respect of such. This he did not do and his explanations for not doing so are not entirely satisfactory. Consequently, his actions give rise to questions about his honesty and this lack of honesty is indirectly related to his activity as a licence holder under the Act. 35 Such a finding must, however, be considered in light of all of the other relevant factors. When determining whether Lindfield is not fit to be the holder of a contractor licence. In my opinion, the other relevant factors are as follows: (a) This was an isolated incident concerning one of the many contracts that Lindfield has entered into since being the holder of a licence; (b) The incident occurred two years ago and no complaints have been received of similar conduct since then; (c) Lindfield now understands what his obligations are when swearing an affidavit as to his assets and liabilities and when giving evidence of such; and (d) There is no evidence that Lindfield's workmanship is unsatisfactory. Indeed his references indicate the contrary and vouch for his honesty and punctuality. 36 For the reasons stated above, in my opinion, the material before the Tribunal, when considered as a whole does not give rise to a finding that Lindfield is no longer fit to be the holder of a contractor licence. Should he engage in similar conduct in the future, then the position would be very different. 37 Accordingly, in my opinion the decision of the Director-General in regard to whether Lindfield is guilty of "improper conduct" and whether Lindfield is no longer "fit" to be the holder of a contractor licence is not the correct and preferred decision. Appropriate Disciplinary Action 38 On the basis of my findings above, it is not necessary to consider the third matter in issue; ie, the appropriate disciplinary action. However, I wish to make some general remarks in this regard as it was argued at the hearing. 39 The primary purpose of the disciplinary provisions of Part 4 of the Act are consumer protection. They are not punitive even though the Director-General is given a discretion to impose a penalty under s62(c) of the Act. That is, they are directed towards protecting consumers from licence holders who do not have the ability or capacity to carry out the work they are authorised to do pursuant to their licence or who are dishonest in carrying out such work. Their purpose is not to provide an additional mechanism whereby the Director-General is able to take action on behalf of individual consumers who are dissatisfied with the work undertaken by a licenced contractor and who have suffered loss as a result. In those cases the consumer's remedy lies with bringing an action against the licence holder under the Act in the Consumer Trader & Tenancy Tribunal or any other appropriate court. 40 As I have observed in other decisions, the disciplinary provisions contained in s62 of the Act are first and foremost discretionary and they range from taking no further action, to cancelling a licence holder's licence. This is a range of disciplinary actions indicate that Parliament intended that the Director-General exercise his discretion under this section having regard to the seriousness of the matters which provided the trigger for such action to be taken. That is, where the breach by a licence holder is technical in nature, and there has been no or very minimal consumer detriment, it may be appropriate for the Director-General to take no further action against the licence holder. On the other hand, to cancel a licence in such circumstances would be inappropriate. 41 On the other hand, where a finding is made that the licence holder is no longer fit to be the holder of a licence, and where such a finding is serious, the suspension or cancellation of the licence is likely to be the most appropriate disciplinary action. As I have said previously, a policy, which addresses such matters would assist the Director-General in making his decision in the individual cases that come before him. 42 In this case, even if I am wrong in my findings as to whether Lindfield is guilty of "improper conduct" or is not "fit" to be the holder of a contractor licence, the circumstances were not, in my opinion, of sufficient seriousness to warrant cancellation or suspension of his licence. They certainly would warrant the issue of a warning and perhaps a fine, but not the most severe of all the disciplinary action the Director-General can take. 43 The Tribunal orders that the decision of the Director-General be set aside.