Kalache's Investments Pty Ltd v Tow Truck Authority of New South Wales [2004] NSWADT 234

CITATION: Kalache's Investments Pty Ltd v Tow Truck Authority of New South Wales [2004] NSWADT 234 DIVISION: General Division APPLICANT PARTIES: Kalache's Investments Pty Ltd RESPONDENT Tow Truck Authority of New South Wales FILE NUMBER: 043335 HEARING DATES: 13/10/2004 SUBMISSIONS CLOSED: 10/13/2004 DATE OF DECISION: 10/14/2004

BEFORE: Hennessy N - Magistrate (Deputy President) APPLICATION: Stay of proceedings MATTER FOR DECISION: Preliminary matter Administrative Appeals Tribunal Act 1975 (Cth) LEGISLATION CITED : Administrative Decisions Tribunal Act 1997 Migration Act 1958 Tow Truck Industry Regulation 1999 Shi v Migration Institute of Australia Ltd and Anor 78 ALD 281 CASES CITED: Williamson v Director-General, Department of Transport [2000] NSWADT 16 Williamson v Director-General, Department of Transport [2000] NSWADT 16 APPLICANT REPRESENTATION: G Blake SC, barrister RESPONDENT D Jordan, barrister ORDERS: 1. The decision of the Tow Truck Authority to refuse the applicant's application for a Tow Truck Operator Licence is stayed pending further order of this Tribunal; 2. The hearing of this matter be expedited.

REASONS FOR DECISION Introduction 1 Kalache's Investments Pty Ltd is a company that operates a tow truck business. The company's sole director is Kaled Kalache. On 8 October 2004 the Tow Truck Authority told Mr Kalache that the company's application for a Tow Truck Operator Licence had been refused. The basis for the refusal was that on 5 October 2004 Mr Kalache and others were charged with conspiracy to defraud the National Bank of $316,000.00. The Tow Truck Authority formed the view on the basis of that charge that Mr Kalache was not a fit and proper person to hold a licence and/or that the granting of the licence was not in the public interest. 2 The company has applied for a stay of the decision to refuse to grant its application for a tow truck operator's licence. An internal review has not been finalised in relation to the decision, but I am nevertheless satisfied, pursuant to s 55(2) of the Administrative Decisions Tribunal Act 1998 (ADT Act), that it is necessary to deal with the application in order to protect the interests of the company and the application was made within a reasonable time following the decision of the administrator. 3 The first issue is whether the refusal of an application for a licence is the kind of decision that can be stayed. If it can be stayed the second issue is whether it should be stayed taking into account factors including the interests of Mr Kalache and the public interest. Can the decision to refuse to grant an application be stayed? 4 The Tow Truck Industry Act 1998 prevents a person from carrying on business as a tow truck operator unless that person is licensed. (s 15) Under s 22, a licence generally continues in force for a period of one year from the date on which it was granted. The company's licence expired on 7 September 2004 but Mr Kalache applied for it to be renewed on 30 August, before it expired. The renewal application was not refused until 8 October 2004. The Regulations provide that in those circumstances the current licence continues until the date on which the person is notified that the subsequent licence has been granted or refused. (Tow Truck Industry Regulation 1999 Cl 22A). Consequently the situation just prior to the decision to refuse the application was that the company was licensed as a tow truck operator. 5 Section 60(2) of the ADT Act gives the Tribunal power to make such orders "staying or otherwise affecting the operation of the decision under review as it considers appropriate to secure the effectiveness of the determination of the application." The staying of a decision is designed to put a person back into the situation that they were in prior to the decision being made. In this case, if the decision were stayed, the company would be in the position of having a current operator's licence. This situation is analogous to that in Shi v Migration Institute of Australia Ltd and Anor 78 ALD 281 where the decision under review was a decision to refuse to renew an applicant's registration as a licensed migration agent. The statutory provisions in that case were similar to those in the present case. (Administrative Appeals Tribunal Act 1975 (Cth) s 41(2) and Migration Act 1958 (Cth) s 300(1).) The legislation provided that the agent's registration was taken to continue beyond the expiry date of their licence pending the authority's consideration of an application for renewal. Tamberlin J decided that the decision not to renew the registration was a termination of the rights of the applicant and accordingly it is a decision capable of being stayed. I respectfully adopt the same reasoning in relation to this case. Should a stay be granted? 6 Securing the effectiveness of the determination. Before granting a stay the Tribunal must be satisfied that it is necessary to "secure the effectiveness of the determination" (ADT Act s 60). The effectiveness of the Tribunal's ultimate decision will not be preserved if, for example, the applicant loses his or her business in the meantime, suffers irreparable losses or loses money for which he cannot be compensated. (Williamson v Director-General, Department of Transport [2000] NSWADT 16 at [15] and [17].) If a stay is not granted, the tow truck business operated by the company will not be able to continue and the company's nine employees will ultimately lose their jobs. Mr Kalache, as the sole director of the company, will suffer significant financial loss if the business ceases to operate. I am satisfied for those reasons that a stay is necessary to "secure the effectiveness of the determination." 7 Desirability of a stay. The Tribunal's next task is to consider whether it is desirable to grant a stay after taking into account: 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. (Section 60(3)) 8 Interests of any person affected by the determination. Mr Kalache is dependent on the income from the tow truck business to support his family and meet his financial commitments. I accept that it is unlikely that he would be able to obtain alternative employment, at least in the short term, which would provide an income comparable to that which he is presently receiving. He would suffer significant financial loss if a stay were not granted. Similarly it is likely that the employees of the company will lose their jobs unless the decision is stayed. 9 Public interest. Relevant factors to be taken into account in assessing the public interest are: · the nature and seriousness of the charges; · whether they relate to the activity for which the applicant is licensed; and · whether public safety may be prejudiced if the applicant continues to operate. 10 Seriousness of the charges. It is not the Tribunal's role to determine whether Mr Kalache is innocent or guilty. I must simply examine the seriousness of the charges and the circumstances of those charges. (Williamson v Director-General, Department of Transport [2000] NSWADT 16 at [15] and [17].) Both parties agreed that the matter with which Mr Kalache has been charged is serious. The charges relate to the purchase of low value residential real estate and the sale of those properties at grossly inflated prices. It is alleged that Mr Kalache and his wife purchased a residential property for $155,000 in December 2000 and that Fadi Sleiman (Mr Kalache's uncle) used a false identity to apply for a loan. The property was then sold for $395,000. Those are the only relevant details that I have before me at the stay hearing. 11 The provisions of the Tow Truck Industry Act suggest that the legislature takes criminal activity within the tow truck industry extremely seriously. There are provisions that oblige the Tow Truck Authority to refuse a licence if the person (or a close associate) has been convicted, or been found guilty with no conviction being recorded, of certain offences including any offence involving fraud, dishonesty or stealing. The Authority may refuse a licence on the ground that a person is not a fit and proper person to hold a licence. In addition, the Authority can take disciplinary action, including suspending a licence, if a person has been charged with an indictable offence. 12 Mr Jordan submitted that the honesty of Mr Kalache was in further doubt because he did not disclose to the Tribunal the fact that Kalache Investment's Pty Ltd has been in receivership since 2 July 2004. That is a matter which is potentially relevant to the company's suitability to have an operator's licence. Section 42(j) of the Tow Truck Industry Act states that the Tow Truck Authority can take disciplinary action against a corporation for which a receiver or manager has been appointed. As Mr Jordan pointed out, in circumstances where I denied him the opportunity to cross-examine Mr Kalache, because of the urgent and interlocutory nature of the proceedings, there is an expectation that parties will draw the Tribunal's attention to any matter relevant to the decision. As I was not told the circumstances which led to the company being placed into receivership, I do not know whether that is a matter which is relevant to the public interest in this case. However, I agree with Mr Jordan that, if that matter is relevant, it reflects adversely on Mr Kalache's level of candour. 13 Relationship between the offence and tow truck operations. The offences with which Mr Kalache has been charged did not take place in the course of his activities as a tow truck operator. However, because the charges allege that Mr Kalache engaged in fraudulent conduct, they are relevant to his suitability to participate in that industry. 14 Public safety. Finally, there was no suggestion that there would be any threat to public safety if Mr Kalache were permitted to continue to operate his business in the short term. Conclusion 15 Mr Kalache has been charged with a serious offence involving fraud and dishonesty. That offence relates to the purchase of a home in 2000, nearly four years ago. The stay is sought in order to allow Mr Kalache to continue to operate his business for a few weeks until a hearing on the substantive issue can take place. If he is not allowed to continue operating his business will close down, his employees will lose their jobs and the income generated by the business will cease. Although it is not in the public interest for people who may have acted fraudulently to operate in the tow truck industry, that public interest is not significant enough in the circumstances of this case to override the potentially serious short term financial consequences to Mr Kalache that would result if a stay were not granted. Order 1. The decision of the Tow Truck Authority to refuse the applicant's application for a Tow Truck Operator Licence is stayed pending further order of this Tribunal. 2. The hearing of this matter be expedited.