Administrative Decisions Tribunal New South Wales Medium Neutral Citation: Baldacchino v Director General, Department of Finance and Services [2013] NSWADT 24 Hearing dates: 21 September 2012 Decision date: 04 February 2013 Jurisdiction: General Division Before: P H Molony, Judicial Member Decision: The Tribunal affirms the decision to cancel Mr Baldacchino's licence, but the decision to disqualify from obtaining a licence in the future is set aside Catchwords: Motor Vehicle Repairer - disciplinary action - receiving - fit and proper person -cancellation - disqualification Legislation Cited: Administrative Decisions Tribunal Act 1997 Crimes Act 1900 Crimes (Sentencing Procedures) Act 1999 Motor Vehicle Repairs Act 1980 Cases Cited: Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321 Carr v Director-General, Department of Finance and Services (formerly Department of Services, Technology and Administration) [2011] NSWADT 157 Drake v Minister for Immigration and Ethnic Affairs (1979) 46 FLR 409 Haining v Commissioner of Police, NSW Police Service (1999) NSWADT 6 Hughes and Vale Pty Ltd v New South Wales (No. 2) (1955) 93 CLR 127 Ng & anor v Commissioner for Fair Trading, NSW Office of Fair Trading & anor [2007] NSWADT 259 Obradovic -v- Commissioner for Fair Trading, Office of Fair Trading (GD) [2006] NSWADTAP 18 Pillai v Messiter [No.2] (1989) 16 NSWLR 197 Sobey v Commercial and Private Agents Board 20 SASR 70 Category: Principal judgment Parties: Alexander Baldacchino (Applicant) Director General, Department of Finance and Services (Respondent) Representation: PJM Lawyers (Applicant) W Maynard, Legal Officer (Respondent) File Number(s): 123163 reasons for decision Introduction 1Mr Baldacchino is the holder of a licence issued under the Motor Vehicle Repairs Act 1980 (the MVR Act) authorising him to carry on business as a Motor Mechanic (Fixed Workshop) and as a Liquefied Petroleum Gas Mechanic. He also holds current motor mechanic and LPG/CNG mechanic certificates. 2Mr Baldacchino has appealed against a decision of the Regulator, made on 25 May 2012, to - (a) take disciplinary action against him under the MVR Act; and, (b ) cancel his licence and disqualify him from holding such a licence, or from being concerned in the management or conduct of a business for which a licence is required. 3The grounds upon which the Regulator made that decision were that Mr Baldacchino - * Had been found guilty of an offence involving fraud or dishonesty. * Had been found guilty of an offence involving being unlawfully in possession or a motor vehicle or a motor vehicle part. * Was probably receiving stolen goods. * Was a person who would be refused a licence were he now to apply for one. * Was not a fit and proper person to hold a licence. The MVR Act 4The MVR Act regulates who can undertake motor vehicle repairs. It puts in place a licencing regime for repairers, and makes it an offence for an unlicensed person to carry on business as a repairer (s 14). Application for a licence is made to the industry regulator (s 16), which has power to refuse to grant such an application on both mandatory and discretionary grounds (s 18). Among the mandatory grounds for refusal is that the applicant is an undischarged bankrupt (s 18(1)(c)). Once issued, a licence remains in force until surrendered, subject to the licence holder lodging an annual statement and paying an annual fee (s 21). 5Part 4 of the MVR Act is concerned with disciplinary proceedings. Section 42 specifies the grounds on which disciplinary action may be taken against a licence holder. Relevantly, it provides - (1) The following are the grounds on which a holder of a licence may be dealt with under this Part: (a) ... (e) that the holder has, within the period of 10 years that last preceded the grant of the licence, been found guilty of an offence involving fraud or dishonesty punishable on conviction by imprisonment for 3 months or more, (f) the holder of a licence has (as an adult), within the preceding 10 years or the period of 10 years that last preceded the grant of the licence, been found guilty of: (i) ... (ii) receiving, or being in unlawful possession of, a motor vehicle (within the meaning of Division 5A of Part 4 of the Crimes Act 1900) or a motor vehicle part, (g) that the Authority considers, in the light of evidence acceptable to the Authority, that the holder is probably receiving or dealing in stolen goods, (h) ... (k) that, if the person were not the holder of a licence, the Authority would be required by this Act to refuse an application by the person for a licence, (l) ... (o) that the holder is, for any other reason, not a fit and proper person to continue to hold a licence. (2) By way of example of the operation of subsection (1) (g), the Authority may consider that the holder of a licence in whose custody stolen goods are found is probably receiving or dealing in stolen goods. 6Section 18 sets out mandatory and discretionary grounds for the refusal of an application for the grant of a licence. The existence of any one of those mandatory grounds is a ground for disciplinary action under s 42(1)(k). Those mandatory ground are relevantly (see s 18) - (a) (c) the applicant is an undischarged bankrupt, or (d) (e) the applicant is not a person likely to carry on such a business honestly and fairly, or (f) (i) the applicant is in any other way not a fit and proper person to hold a licence, or (j) the applicant has (as an adult), within the preceding 10 years, been found guilty of an offence involving, or relating to: (i) ... (ii) receiving, or unlawful possession of, a motor vehicle (within the meaning of Division 5A of Part 4 of the Crimes Act 1900) or a motor vehicle part, or (k) ... 7Section 41 establishes a show cause procedure for licence holders to show why disciplinary action should not be taken against them for "reasons specified in the notice." The licence holder is able to adduce evidence and make submissions in response to the notice (s 41(3)). In Mr Baldacchino's case his solicitors made submission in response to a show cause notice. 8Section 44 sets out the Regulator's powers, if satisfied that a ground for taking disciplinary action exists. Relevantly, it provides - 1) The Authority may, after complying with section 41, take any of the following actions if satisfied that a ground exists on which the holder of a licence or certificate may be dealt with under this Part: (a) reprimand the holder, (b) require the holder to comply within a specified time with a requirement specified by the Authority, being a requirement relating to the conduct of the business or other activity to which the licence or certificate relates or to any other thing regulated by or under this Act, (c) suspend the licence or certificate for a period not exceeding 12 months, (d) in the case of the holder of a licence, disqualify the holder or any person concerned in the direction, management or conduct of the business to which the licence relates from holding a licence or from being concerned in the direction, management or conduct of a business for the carrying on of which a licence is required, either permanently or for such period as the Authority thinks fit, (e) impose a condition or restriction on the licence or certificate, (f) cancel the licence or certificate. (2) Without limiting the powers conferred by subsection (1), among the requirements that the Authority may specify under subsection (1) (b) is a requirement that the holder of the licence concerned: (a) make a contribution to the Contingency Fund of such amount as the Authority specifies, or (b) indemnify the Fund to such extent as the Authority specifies in the event of a particular contingency arising concerning the activities of the holder of the licence. (3) Despite subsection (1), the Authority must cancel the licence concerned if satisfied that: (a) a matter referred to in section 42 (1) (f) has been established, or (b) in the case of a licence holder that is a body corporate, if the body corporate were not the holder of a licence, the Authority would be required by section 18 (3) (k) to refuse an application by the body corporate for a licence. (3A) ... (4) A holder of a licence or certificate must comply with a requirement of the Authority specified under subsection (1) (b) within the time specified by the Authority. Maximum penalty: 20 penalty units. (5) If the Authority disqualifies the holder of a licence, the Authority must cancel the licence. (6) A cancellation or suspension of a licence or certificate under this section takes effect on and from the day determined by the Authority and notified in writing to the holder of the licence or certificate. (7) The holder of a licence or certificate that is suspended or the former holder of a licence or certificate that is cancelled must return the licence or certificate to the Authority within the period specified by the Authority when suspending or cancelling the licence. Maximum penalty: 20 penalty units. (8) A person disqualified under this section must not, while disqualified: (a) hold a licence, or (b) be concerned in the direction, management or conduct of a business for which this Act requires a licence to be held. Maximum penalty (subsection (8)): 20 penalty units. 9If the regulator determines to cancel a licence and disqualify the holder from holding a licence, as was the case with Mr Baldacchino, s 45(1) gives the holder a right to seek a review of that decision in this Tribunal. When read with s 38 of the Administrative Decisions Tribunal Act 1997 (the ADTA) it confers jurisdiction on the Tribunal to review such decision on the merits. 10Section 63 of the ADTA says that in determining an application for review the Tribunal is to make the correct and preferable decision having regard to the material before it, and any applicable written or unwritten law. It is well established that in considering an application for review the Tribunal may have regard to any relevant material before it at the time of the review: Drake v Minister for Immigration and Ethnic Affairs (1979) 46 FLR 409. The salient facts 11In reality there is little dispute between the parties as to the salient facts. They are founded on: * A series of convictions recorded against Mr Baldacchino and what he told the Regulator about them. * The fact that Mr Baldacchino was bankrupt from 27 February 2009 to 28 February 2012 and did not disclose that fact to the Regulator. 12On 30 January 2003 was convicted in the Penrith Local Court of displaying misleading number plates on a vehicle in August 2003. He was fined $500. He was also charged with taking and driving a conveyance without consent at the same time. The Court found him guilty of the offence, but dismissed the charge under s 10 of the Crimes (Sentencing Procedures) Act 1999. The facts underlying those charges are set out in detail at pages 77 to 79 of the s 58 materials. There was no dispute that Mr Baldacchino had fitted false number plates to a vehicle belonging to one of his clients and used the vehicle for his own purposes, without the owner's permission. The statement of facts acknowledges differences between Mr Baldacchino and the vehicle's owner as to how he obtained the vehicle. The owner said it had been stolen form a car park, whereas Mr Baldacchino said it had been left at his business by the owner. 13Mr Baldacchino gave sworn evidence about this event to me. He agreed that he did not have permission to use the vehicle, but was doing so to test it. He had purchased some cigarettes for his business while conducting that test. I have grave difficulty in accepting that evidence. It is inconsistent with what Mr Baldacchino told the Police, and with his admission to Police that he had fitted false number plates to the vehicle when using it. I do not accept that a repairer testing a vehicle belonging to an established client- with or without permission - would change the plates. I reject Mr Baldacchino's evidence in this regard. 14When Mr Baldacchino applied for his licence in 2007 he filled in an application form, the contents of which he declared to be true and correct. When completing the application Mr Baldacchino had answered "No" to a question asking whether he had been, "found guilty of any criminal offence, within the past 10 years, whether or not the offence was recorded as a condition." The application warned that - You must answer 'Yes' even if an offence has been dismissed under s 10 of the Crimes (Sentencing Procedures) Act 1999 or s 556A of the Crimes Act 1900. If unsure seek legal advice before making your application. 15By answering the question in that fashion Mr Baldacchino failed to disclose to the Regulator the offences that the Penrith Local Court convicted him of or found him guilty of on 30 January 2003, including taking and driving a conveyance without consent. 16As a result of events that occurred in November 2006 Mr Baldacchino was convicted in December 2007 of using a carriage service to menace harass or offend. He was sentenced to six months imprisonment, which sentence was suspended on him entering a 6 month bond to be of good behaviour under s 12 of the Crimes (Sentencing Procedures) Act 1999. Mr Baldacchino had made threats to harm another mechanic who was embroiled in a dispute with his son concerning an engine. He was concerned that the mechanic had arranged for Police to be in attendance at a meeting arranged between the mechanic and his son, at which the mechanic was meant to pay moneys extorted from him under threat by the son. The threats made by Mr Baldacchino concerned what would happen to the mechanic if the Police arrested his son. He told me that at the time he was concerned that the victim was setting up his son. 17On 14 August 2008 Mr Baldacchino was charged with: * Possess a motor vehicle or vessel, with the intention of dishonestly interfering with, or copying, a unique identifier (two counts). On 15 September 2010 he was convicted at the Downing Centre Local Court, and placed on a s 9 bond to be of good behaviour for two years. * Receive a motor vehicle part the stealing of which is a serious indictable offence. On 11 November 2010 he was convicted at the Penrith Local Court and sentenced to 7 months home detention with a non-parole period of 3 months. * Possess a vehicle with intent to copy the identifier. On 11 November 2010 he was convicted at the Penrith Local Court and sentenced to 7 months home detention with a non-parole period of 3 months. 18The Police fact sheet alleges that Mr Baldacchino was found driving a vehicle that had been stolen and then rebirthed twice. The vehicle was said by Police to have an estimated value of $20,000. It was registered in Mr Baldacchino' name. When examined by Police it was found to have an altered engine number. Mr Baldacchino told Police that he had purchased the vehicle for $5,500 and had made a number of alterations to it, which were original items identified by the original owner. Police alleged that he had removed valuable seats from the vehicle and replaced them with, "an old and torn bench seat." 19Mr Baldacchino's evidence to me concerning these events was that the vehicle concerned was his own and that he had been charged with receiving a part only: a part he did not know was stolen. The Police facts, however, as summarised above, paint a much more serious picture. 20As I have previously mentioned s 21 of the MVR Act requires a licence holder to lodge an annual return and pay an annual fee. The annual renewal form asks whether, among other things, the licence holder: * Has been convicted of any offence that was recorded in the last 10 years; * Is the subject of a pending charge involving fraud or dishonestly; and, * Has become an undischarged bankrupt? The form requires the licence holder to certify that the information supplied is "correct and complete." 21In the annual return Mr Baldacchino completed on 20 November 2009 he answered "Yes" to the question about whether a charge was pending against him involving fraud or dishonesty. On a sheet he attached to the application Mr Baldacchino wrote - Pending goods in custody over a dispute with an engine that may have a stolen Police number. I purchased a motor for my own vehicle (which I put in my vehicle) from E-Bay. The motor may have been stolen. The Police have the name of the person I bought the motor from. I have receipt and proof of purchase. Any queries please don't hesitate to contact me. Mr Baldacchino answered no to the other question in the annual return. 22It follows that when completing the 2009 annual return Mr Baldacchino: * Failed to disclose his 2003 and 2006 convictions. * Falsely certified that he had no convictions in the past 10 years. * Failed to disclose that he had been bankrupt since 27 February 2009. * Did not fully or accurately disclose to the Regulator the charges that Police had laid against him on 14 August 2008. 23In the annual return Mr Baldacchino completed on 10 November 2010 he answered "Yes" to the questions concerning whether he had any conviction in the last ten year or charges pending against him. He answered "No" to the question concerning whether he was bankrupt, despite the fact that was still an undischarged bankrupt. 24In his evidence Mr Baldacchino told me something about his personal and financial circumstances. I accept that he has family members and employees who are reliant on him, and that the Regulators decision to cancel his licence and disqualify him from obtaining one in the future will cause him considerable financial hardship. While he will still be the holder of a mechanics certificate, I accept that his age and poor health may well have an impact on his ability to gain employment in that role. 25Mr Baldacchino produced a number of professional references testifying to the good reputation his business has with its customers, neighbours and other traders. There were also six personal references going to his good general reputation. None of the referees referred to or displayed an awareness of the matters which led the Regulator to make its decision. That omission substantially reduced the weight to be given to those testimonials. This is so as they do not address the fundamental issues which the Regulator relies on as affecting Mr Baldacchino's character and reputation. Consideration 26It is clear from the evidence that Mr Baldacchino has a conviction for receiving contrary to s 188(1) of the Crimes Act 1900. That section provides - (1)Whosoever receives, or disposes of, or attempts to dispose of, any property, the stealing whereof amounts to a serious indictable offence, knowing the same to have been stolen, shall be guilty of a serious indictable offence, and may be indicted, either as an accessory after the fact, or for a substantive offence, and in the latter case whether the principal offender has been previously tried or not, or is amenable to justice or not, and in either case is liable: (a) if the property is a motor vehicle or a motor vehicle part, or a vessel or a vessel part, to imprisonment for 12 years, or (b) in the case of any other property, to imprisonment for 10 years That conviction was recorded in December 2010. It is a ground for taking disciplinary action against Mr Baldacchino under s 42(1)(f)(ii) of the MVR Act. 27At the same time it provides a ground for taking disciplinary action against Mr Baldacchino under s 42(1)(k) on the basis that, if he were a new applicant and not a licence holder, the Regulator would be compelled to refuse his application on a mandatory basis under s 18(j)(ii). 28The Regulator also considered that the receiving conviction, combined with the other evidence, satisfied the ground for disciplinary action under s 42(1)(g), that the Regulator believes that the holder is probably receiving or dealing in stolen goods. The conviction for receiving demonstrates this. In my view it is better to approach disciplinary action in this case on the basis of the conviction for receiving, rather than a belief that Mr Baldacchino was receiving. 29The Regulator also determined to take disciplinary action against Mr Baldacchino on the ground that he is not a fit and proper person to hold a licence. 30In Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321,Chief Justice Mason explained that, at 380: 'The question whether a person is fit and proper is one of value judgment. In that process the seriousness or otherwise of particular conduct is a matter for evaluation by the decision maker. So too is the weight, if any, to be given to matters favouring the person whose fitness and propriety are under consideration.' Toohey and Gaudron JJ said at 380: "The expression "fit and proper person", standing alone, carries no precise meaning. It takes its meaning from its context, from the activities in which the person is or will be engaged and the ends to be served by those activities. The concept of "fit and proper" cannot be entirely divorced from the conduct of the person who is or will be engaging in those activities. However, depending on the nature of the activities, the question may be whether improper conduct has occurred, whether it is likely to occur, whether it can be assumed that it will not occur, or whether the general community will have confidence that it will not occur. The list is not exhaustive but it does indicate that, in certain contexts, character (because it provides indication of likely future conduct) or reputation (because it provides indication of public perception as to likely future conduct) may be sufficient to ground a finding that a person is not fit and proper to undertake the activities in question." 31A person's fitness is to be gauged in the light of the nature and purpose of the activities that the person will undertake. In Hughes and Vale Pty Ltd v New South Wales (No. 2) (1955) 93 CLR 127 the High Court said (at 156-7): "The expression 'fit and proper' is of course familiar enough as traditional words when used with reference to offices and perhaps vocation. But their very purpose is to give the widest scope for judgment and indeed for rejection. 'Fit' (or 'idoneus') with respect to an office is said to involve three things, honesty, knowledge and ability ... When the question was whether a man was a fit and proper person to hold a licence for the sale of liquor it was considered that it ought not to be confined to an inquiry into his character and that it would be unwise to attempt any definition of the matters which may legitimately be inquired into; each case must depend upon its own circumstances." 32In Sobey v Commercial and Private Agents Board 20 SASR 70 Walters J said: "In my opinion what is meant by that expression is that the applicant must show not only that he is possessed of a requisite knowledge of the duties and responsibilities evolving upon him as the holder of a particular licence ... but also that he is possessed of sufficient moral integrity and rectitude of character as to permit him to be safely accredited to the public ... as a person to be entrusted with the sort of work which the licence entails." 33Fitness and propriety are flexible concepts. A consideration of whether a person is fit and proper involves an assessment of their knowledge, honesty and ability in the context of the role they are seeking to undertake. Thus in Obradovic -v- Commissioner for Fair Trading, Office of Fair Trading (GD) [2006] NSWADTAP 18 the Appeal Panel agreed that a formerly licenced building contractor should have his application for a new licence refused because, despite there being no evidence that he was dishonest or of bad repute, evidence that he had been extremely tardy and intransigent in dealing with customer complaints, and the regulator, when he held a licence, was sufficient to conclude that he was not fit and proper for the role. In that case the licensing scheme was among other things, designed to protect consumers and to provide them with adequate means of redress against licensed contractors. In Bond the assessment occurred in the context of whether the applicant was a fit and proper person to hold a licence under the Broadcasting Act 1942 (Cth). 34In Haining v Commissioner of Police, NSW Police Service (1999) NSWADT 6 at [41] the President of this Tribunal made the following comments on the issue, in the context of the security industry: 'Whether a person is 'fit and proper' to hold a licence in a regulated industry will be affected by general considerations relating to the character of the person, special considerations that take account of the nature of the industry in issue and the public policy objective leading the legislature to regulate the industry.' 35In Mr Baldacchino's case I consider that his convictions and his failure to advise the Regulator about them, and of his bankruptcy, demonstrates a lack of candour and degree of dishonesty of Mr Baldacchino's part, that is incompatible with that required of a licenced motor vehicle repairer. His apparent disregard for important safeguards for protection of property in his trade (i.e. licence plates and other unique identifiers for motor vehicles) emphasizes this, as does his apparent contempt for the requirements of the industry Regulator. A licence holder is required to be honest and candid in dealings with the Regulator. Mr Baldacchino was not. He failed disclose important matters that would have affected his license. He falsely certified as correct his answers to questions given to hide those matters from the Regulator. 36I am not satisfied that Mr Baldacchino is a fit and proper person to hold a licence under the MVR Act. Disciplinary Action 37Mr Baldacchino's representative submitted that he should be allowed to continue to operate his business. He argued that Mr Baldacchino had been sufficiently punished for his crimes, and had learned his lesson as a result of them. He would suffer significant personal and financial hardship if his licence was interfered with. 38In determining a review of a decision to cancel a licence the Tribunal's focus is not on disciplining or punishing the authority holder, but on the protection the public interest. As Kirby P explained in Pillai v Messiter [No.2] (1989) 16 NSWLR 197 at 201, albeit he was concerned with a medical practitioner:- "... The public needs to be protected from delinquents and wrong-doers within professions. It also needs to be protected from seriously incompetent professional people who are ignorant of basic rules or indifferent as to rudimentary professional requirements. Such people should be removed from the register or from the relevant roll of practitioners, at least until they can demonstrate that their disqualifying imperfections have been removed ..." 39In my opinion the finding that Mr Baldacchino is not a fit and proper person to hold a motor vehicle repairer's licence, is incompatible with him continuing to hold such a licence. In the absence of extraordinary circumstances, it requires that his licence be cancelled. This is so irrespective of any hardship he may suffer as a result. That his character is such that he is not a fit and proper person to hold a licence necessarily requires cancellation. 40That being the case I agree with the decision of the Regulator to cancel Mr Baldacchino's licence. 41The Regulator also disqualified Mr Baldacchino from obtaining a licence in the future under s 44(1)(d). While the Regulator had the power to do so, it did not specify a term of disqualification, instead disqualifying Mr Baldacchino on an ongoing basis. 42In my view this penalty is oppressive, allowing no hope or opportunity for Mr Baldacchino to demonstrate that he has reformed himself and that his "disqualifying imperfections have been removed." Removing all hope that a person such as Mr Baldacchino may reform himself so as to again conduct business as a motor vehicle repairer is harsh and not in the public interest. The reality is that a person who has had his licence cancelled on the ground that she or he is not a fit and proper person will have to demonstrate that those imperfections have been removed before the Regulator will again grant a licence. 43In my view any period of disqualification must be appropriate and measured to fit the individual circumstances of each case. 44Mr Maynard for the Regulator referred me to the decisions of the Tribunal in Carr v Director-General, Department of Finance and Services (formerly Department of Services, Technology and Administration) [2011] NSWADT 157 and Ng & anor v Commissioner for Fair Trading, NSW Office of Fair Trading & anor [2007] NSWADT 259. It can be seen that I agree with Higgins DP in Carr that a finding that a licensee is not fit and proper usually requires a decision to cancel. In Ng I set out a series of factors that I considered relevant to the consideration of penalty in a case relating to a builder who had performed unsatisfactory work and breached statutory warranties. Not all of those considerations are applicable in a case such as this. 45Importantly in the present case there is no evidence of contrition on Mr Baldacchino part, or of any real understanding of why his conduct is incompatible with him continuing to hold a licence. His evidence to me was restricted to exculpatory explanations of his conduct, with no hint of regret or repentance. In my view this points to Mr Baldacchino requiring some time where he is ineligible to operate a business as a motor repairer. Time in which he can gain some appreciation of the seriousness of his conduct, and which is sufficient for any change he may make in his character to be made and consolidated. 46In the present case the reality is that, because of the operation of the mandatory disqualification provision in s 18(1)(j)(ii), Mr Baldacchino will not be eligible to apply for a licence again until ten years has elapsed from his conviction for receiving. This is so without any disqualification order being made. Given Mr Baldacchino's age, history and antecedents, any disqualification order I might make would not exceed that period. 47As a consequence, in the circumstances of this case, I think it unnecessary to make a disqualification order, but rely on the operation of s 18(1)(j)(ii) to stop him applying for a licence for 10 years from his receiving conviction. Conclusion 48It follows that the Tribunal affirms the decision to cancel Mr Baldacchino's licence, but the decision to disqualify from obtaining a licence in the future is set aside. ********** 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: 04 February 2013