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AVS Group Australia Pty Limited v Commissioner of Police, NSW Police Force [2012] NSWADT 1 (10 January 2012)
Last Updated: 19 January 2012
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Administrative Decisions Tribunal
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Case Title:
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AVS Group Australia Pty Limited v Commissioner of
Police, NSW Police Force |
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Medium Neutral Citation:
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Hearing Date(s):
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8, 11, 14, 15, 31 March, 6,11 April, 26, 27, 39,
31 May, 3, 10, 15, 17, 22, 29, 30 June 2011 |
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Decision Date:
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Jurisdiction:
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Before:
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S Montgomery, Judicial Member |
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Decision:
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1. In matter No. 093216 the decision under review is
affirmed 2. In matter No. 093202 the decision under review is affirmed
3. The orders take effect 14 days after the date of this decision |
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Catchwords:
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Security Industry Act - Security industry licence
- revocation or suspension of licence - undisclosed close associate - relevant
position |
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Legislation Cited:
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Cases Cited:
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Texts Cited:
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Parties:
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(093202) FIRST APPLICANT AVS Group of
Companies Pty Ltd SECOND APPLICANT Peter
Sleiman RESPONDENT Commissioner of Police, NSW Police
Force (093216) FIRST APPLICANT AVS Group Australia Pty
Ltd SECOND APPLICANT Tony Sleiman RESPONDENT Commissioner of
Police, NSW Police Force |
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Representation
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Counsel K Oliver, (Applicants) T Lynch
(Respondent) M Higgins (counsel assisting the Tribunal) |
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- Solicitors:
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AJL Legal (Applicants) Crown Solicitor's Office
(Respondent) R McIlwaine and S Schaudin, Legal Representation Office (counsel
assisting the Tribunal) |
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File number(s):
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Publication Restriction:
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REasons for decision
- GENERAL
DIVISION (S MONTGOMERY, (JUDICIAL MEMBER)): These applications relate to
determinations by the Commissioner of Police ("the
Commissioner") to cancel
licences held by the applicants under the Security Industry Act 1997
("the Act").
- In
these reasons I will refer to Mr Tony Sleiman as 'Tony' and Mr Peter Sleiman as
'Peter'. No disrespect is intended by referring
to these individuals by their
first names. I will refer to matter No. 093202 as 'the Peter Sleiman matter'.
Matter No. 093216 is
referred to as 'the Tony Sleiman matter'.
- Tony
is the sole director and shareholder of AVS Group Australia Pty Ltd ("AVS GA").
A master security licence was issued to Tony
in respect of AVS GA.
- Peter
is the licensee in respect of AVS Group of Companies Pty Ltd ("AVS GC") and a
disclosed close associate of ASET Security and
Training Pty Ltd.
Background
- The
background to the applications is set out in the Appeal Panel decision in AVS
Group of Companies Pty Ltd v Commissioner of Police, NSW Police Force (GD)
[2010] NSWADTAP 61 as follows:
"8 On 23 July 2009 the Commissioner of Police served a notice of
revocation on Mr Peter Sleiman revoking his personal licence held
under [the
Act], Class 1ABC Class 2ABD, and the Master Licences held by the two companies
for which he is the nominated person, AVS Group of Companies
Pty Ltd and ASET
Security and Training Pty Ltd, numbers 4084999079 & 408981164.
9 On 13 August 2009 the Commissioner of Police served a notice of
revocation on Mr Tony Sleiman as the nominated person revoking the
Master
Licence issued in the name of AVS Group Australia Pty Ltd.
10 In both cases service was effected at the common business address for
the above businesses, 88 Parramatta Rd, Granville.
Contents of Notices of Revocation
11 The 23 July 2009 notice of revocation gave as grounds for revocation
that Peter was no longer a fit and proper person to hold a
security licence
(referring to section 26(1A) read in combination with section 15(1)(a) of the SI
Act) and was not in the public interest (not referring to any provisions, but
the relevant provisions are section 26(1A) read in combination with section
15(3)).
12 The body of the notice made no further reference to the public interest
ground. It confined itself to the fitness ground. It begins
with words: 'For the
purposes of Section 26(1A) and Section 15(1)(a) of the Act, Section 15(6)
provides; and then set out the words of the sub-section which are as follows:
(6) For the purpose of determining whether an applicant is a fit and
proper person to hold the class of licence sought by the applicant,
the
Commissioner may have regard to any criminal intelligence report or other
criminal information held in relation to the applicant
that:
(a) is relevant to the activities carried out under the class of licence
sought by the applicant, or
(b) causes the Commissioner to conclude that improper conduct is likely to
occur if the applicant were granted the licence, or
(c) causes the Commissioner not to have confidence that improper conduct
will not occur if the applicant were granted the licence.
13 The 13 August 2009 notice gave as the grounds for revocation that Tony
had contravened a condition of a licence being failure to
disclose particulars
of a close associate, Peter Sleiman, that a close associate of AVS Group
Australia Pty Ltd is not a fit and
proper person to hold a licence (Peter
Sleiman) and that it is not in the public interest that Tony hold a licence.
Section 26(1)(b)(iii) provides that contravention of a condition is a ground for
revocation.
14 The body of the notice was fuller than in the case of the Peter notice.
It started off with the same material as in the Peter notice
relating to the
fitness ground, quoting section 15(6) and then went on to state:
Section 15(7) of the Act states that the Commissioner is not, under this
or any other law, required to give any reasons for not granting a licence if the
giving of those reasons would disclose the existence or content of any criminal
intelligence report or other criminal information
as referred to in subsection
(6).
Section 15(5) of the Security Industry Act 1997 prescribes that except as
provided by the regulations, reference in this section to an applicant includes,
in the case of an application
for a master licence, a reference to each close
associate of the applicant.
Section 26(1)(d) of the Security Industry Act 1997 prescribes that a
licence may be revoked for any other reason prescribed by the regulations.
Clause 29 of the Security Industry Regulation 2007 provides that a
licence may be revoked if the Commissioner considers that it is not in the
public interest for the person to whom
it was granted to continue to hold it.
15 The notice then gave information as to the licensee's rights to apply
for review by the Tribunal.
16 [The Commissioner has indicated in the course of these proceedings that
the 'public interest' grounds in each of the decisions
is no longer pressed.
...]
17 In respect of the 'Peter Sleiman' revocations, the affected persons
filed an application for review by the Tribunal on 30 July
2009. In the 'Tony
Sleiman' case the affected party filed an application for review on 13 August
2009. As already noted, on 13 August
2009 stays were granted, the context
further explained below.
- The
Appeal Panel also set out a litigation history of the proceedings that included
what the Appeal Panel referred to as " a welter
of interlocutory appeal
activity". Since the time of that decision there have been a number of further
interlocutory appeals, applications
to the Supreme Court and Court of Appeal and
an application for special leave to the High Court.
- In
Commissioner of Police v Sleiman & AVS Group of Companies Pty Ltd &
Ors [2011] NSWCA 21 the Court of Appeal considered the proposal that the
Tribunal adopt a "special advocate" procedure to independently assess the
confidential
material. Following on from the Court of Appeal's consideration of
that issue, the Tribunal has had the benefit of Mr Higgins in
the role of
counsel assisting in these proceedings and the support of Mr McIlwaine and Mr
Schaudin from Legal Representation Office.
- Section
75(1) of the Administrative Decisions Tribunal Act 1997 ("the ADT Act")
provides that proceedings of the Tribunal are to be conducted in public, but
sub-section (2) then makes provision in relation to
closed hearings and the
Tribunal's powers to restrict the disclosure, and publication, of evidence and
materials before it. It provides:
(2) However, if the Tribunal is satisfied that it is desirable to do so by
reason of the confidential nature of any evidence or matter
or for any other
reason, it may (of its own motion or on the application of a party) make any one
or more of the following orders:
(a) an order that the hearing be conducted wholly or partly in private,
(b) an order prohibiting or restricting:
(i) the disclosure of the name, address, picture or any other material
that identifies, or may lead to the identification of, any
person (whether or
not a party to proceedings before the Tribunal or a witness summoned by, or
appearing before, the Tribunal), or
(ii) the doing of any other thing that identifies, or may lead to the
identification of, any such person,
(b1) an order prohibiting or restricting the publication or broadcast of
any report of proceedings before the Tribunal,
(c) an order prohibiting or restricting the publication of evidence given
before the Tribunal, whether in public or in private, or
of matters contained in
documents lodged with the Tribunal or received in evidence by the Tribunal,
(d) an order prohibiting or restricting the disclosure to some or all of
the parties to the proceedings of evidence given before the
Tribunal, or of the
contents of a document lodged with the Tribunal or received in evidence by the
Tribunal, in relation to the proceedings.
...
- The
licences held by AVS GC and by Peter were revoked by the Commissioner pursuant
to section 26 (1A) of the Act. The Notice of Revocation gave as it reasons for
the revocation of the licence that the holder was no longer a fit and proper
person
for the purposes of holding a licence under the Act. The Notice of
Revocation is under review in these proceedings.
- Section
26 of the Act provides:
26 Revocation of licence
(1) A licence may be revoked:
(a) (Repealed)
(b) if the licensee:
(i) supplied information that was (to the licensee's knowledge) false or
misleading in a material particular in, or in connection
with, the application
for the licence, or
(ii) contravenes any provision of this Act or the regulations, whether or
not the licensee has been convicted of an offence for the contravention, or
(iii) contravenes any condition of the licence, or
(c) (Repealed)
(d) for any other reason prescribed by the regulations.
(1A) The Commissioner must revoke a licence where the Commissioner is
satisfied that, if the licensee were applying for a new licence,
the application
would be required by this Act to be refused.
...
Issues
- The
substantive issue is whether the Commissioner's decision to revoke the various
licences should be varied, set aside or confirmed.
This requires consideration
of a number of issues but primarily the issue of whether Peter is a close
associate of Tony and AVS GA;
and if so, whether Peter is a fit and proper
person to hold a licence under the Act.
- Section
63 of the ADT Act 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 is not
constrained to have regard only to the material that was before the
Commissioner, but may have regard to any
relevant material before it at the time
of the review: Drake v Minister for Immigration and Ethnic Affairs [1979] AATA 179; (1979)
46 FLR 409. Re Repatriation Commission and McCartney (1986) 9 ALD 441 at
449; Turner v minister for Immigration and Ethnic Affairs [1981] FCA 65; (1981) 35 ALR
388 at 390
Onus Of Proof
- Section
29 of the Act permits an application to the Tribunal for review a decision in
relation to a licence under the Act. There is no provision in the Act for the
onus of proof in such a review. Whilst Part 2 of Chapter 6 of ADT Act empowers
the ADT to determine its own procedure, it is silent as to the onus of proof in
an application for review. Accordingly,
it is appropriate to consider the
administrative context in which the provisions of the Act operate, and the
issues relevant to the review of the Commissioner's decision.
- Whilst
it is clear that the Tribunal can determine its own procedure, and undertake its
own inquiries if so minded, the reference
to "receive evidence and hear
argument" in section 29 (3)(b) contemplates the Tribunal will conduct a hearing
in which the Commissioner will seek to sustain the revocation.
- The
administrative context is whether circumstances existed to justify the
cancellation of the licence. In the Tony Sleiman matter
those circumstances
concern the alleged breach of a condition of the licence, namely the failure by
Tony to disclose a close association
with Peter during the period of the master
licence revoked, and whether Peter was, in fact, a close associate of Tony. In
the Peter
Sleiman matter the circumstances are those that the commissioner would
consider justify a refusal to renew a licence of a notional
applicant as bearing
directly upon the fitness and propriety to hold a class of licence under the
Act. It is implicit in this that the Commissioner holds material that contains
information directly concerning the conduct of Peter and
AVS GC.
- The
Applicants in the Tony Sleiman matter submit that the Commissioner bears the
onus of proving the breach of the condition of the
licence and that Peter was in
fact a close associate of Tony. The Applicants in the Peter Sleiman matter
submit that the Commissioner
bears the onus of proving that Peter is not a fit
and proper person to hold the licence.
- They
submit that if the review is characterized as analogous to that in a breach of
discipline matter, the onus of proving such a
breach lies on the party alleging
the breach. The Applicants cited the decision of Beaumont J in Minister for
Health v Thomson [1985] FCA 208; (1985) 8 FCR 213 in which his Honour quoted with approval
Professor Campbell's explanation of legal burdens of proof:
" ... where the issue to be decided is whether circumstances have arisen
which would justify cancellation or suspension of a licence
... the onus of
proving that these circumstances have arisen would devolve on the accuser."
- The
view of Beaumont J. in Minister for Health v Thomson was cited with
approval by Hill J in Casarotto v Australian Postal Commission [1989] FCA 116; (1989) 86
ALR 399 at 412-413.
- In
Re Appeals of Johnson and Anderson [1967] 2 NSWLR 357 the Court was
concerned with two statutory appeals from the decisions of the Medical
Disciplinary Tribunal where both appellants
were found guilty in the original
Tribunal of infamous conduct. Both appeals were hearings de novo. Whilst the
court accepted that
the appellants had an appellant's onus to show that the
decision appealed was wrong, the appellant discharged the onus by showing
that
the complainant in the original proceedings had not discharged its onus.
- In
Secretary, Department of Social Security v Willee and Others [1990] FCA 221; (1990) 96
ALR 211 per Foster J, the Federal Court was concerned with an application for
review of a decision of a disciplinary appeals committee to
vary the decision of
the applicant to the Federal Court substituting dismissal of the second
respondent with a monetary penalty.
The applicant sought an order of review on
the ground that the committee had regarded the applicant as bearing an onus of
justifying
the decision. The argument of the applicant that the committee fell
into error by treating the second respondent's appeal to the
committee on the
basis that the onus lay on the applicant to justify the decision was rejected.
Foster J rejected the general proposition
that the concept of an ultimate onus
of proof being inappropriate to proceedings before an administrative tribunal
where that tribunal
is to determine disciplinary proceedings. At page 220 Foster
J stated:
"In such circumstances, common fairness would require the casting of the
customary onus upon the prosecution to prove its case. Such
a situation is, in
my opinion, significantly different from one where an inquiry or investigation
of an administrative character
is being undertaken ... Generally speaking,
concepts of onus of proof used in adversary proceedings are inapplicable in
administrative
proceedings in the social security area ... However, where, as
here, a breach of discipline or something analogous is alleged, the
onus of
proving such a breach of lies upon the accuser."
- In
contrast to the view expressed by Beaumont J in Thompson , Fox J stated:
"I do not think it useful, and it may be misleading, to talk in terms of
onus of proof in relation to proceedings such as those with
which the Committee
was concerned. The Committee was one of inquiry, and it was inquiring into the
services charged by one doctor.
It was obliged to find the facts, so far as it
could do so, concerning those services. There were not multiple parties to the
inquiry.
The process at the hearing was one in which documentary evidence was
formally laid before it by its Secretary and thereafter Dr.
Thomson gave
evidence and was questioned at length by members of the Committee. No other
evidence was called. To talk of onus of
proof, in its legal sense, is in my view
inappropriate (cf. McDonald v. Director-General of Social Security [1984] FCA
57; (1984) 1 F.C.R. 354)."
- The
Commissioner submits that there is disagreement in Thompson . He argues
that neither party bears a legal onus of proof in the Tribunal unless the
legislation governing the decision under review
provides to the contrary.
- The
Administrative Appeals Tribunal considered the various authorities in VBN and
Ors and Australian Prudential Regulation Authority and Anor [2006] AATA 710;
(2006) 92 ALD 259. APRA disqualified seven directors of a staff superannuation
fund trustee. All were disqualified under section 120A(2) of the contravened
the
Superannuation Industry (Supervision) Act 1993 ("the SIS Act") on the
basis that they were directors at times when the trustee entity allegedly
contravened sections 52(2)(b), (c) and (g) of the SIS Act and that those
contraventions were of such nature and seriousness as to justify their
disqualification. The AAT decided that the
Trustee had not contravened the SIS
Act and with regard to all seven of the directors, that there is no power to
disqualify them under section 120A(2). The tribunal set
aside each of APRA's
decisions on that basis. However, with regard to the remaining two, VBW and VBN,
APRA also based its decisions
on their not being fit and proper persons to be
responsible officers of the trustee. This entitled the regulator to disqualify a
person not considered a fit and proper person. In considering the general
principles of the manner in which the case was presented,
the tribunal was asked
to consider setting aside the decision of APRA in the absence of being
affirmatively satisfied whether the
Trustee has contravened the Act and whether
a person is a fit and proper person to be a responsible officer of the Trustee.
In considering the submissions to set
aside the decision of APRA the Tribunal
considered a number of authorities:
230. The Trustee and the Applicants submitted that, unless the Tribunal is
affirmatively satisfied of the relevant matters in s 120A,
it is bound to set
aside APRA 's decisions. They relied on a passage from the judgment of Woodward
J in McDonald v Director -General of Social Security : [(1984) [1984] FCA 57; 1 FCR 354;
6 ALD 6]
"If the AAT finds itself in a state of uncertainty after considering all
the available material, unable to decide a question of fact
either way on the
balance of probabilities, it will be necessary to analyse carefully the decision
it is reviewing. If, for example,
it is a decision whether or not to cancel a
pension in the light of changed circumstances, then it has failed to achieve the
statutory
requirement of reaching a state of mind. ..."[ [1984] FCA 57; (1984) 1
FCR 354; 6 ALD 6 at 358; 11]
231. They relied too on a passage from the judgment of Beaumont J in
Minister for Health v Thomson [(1985) [1985] FCA 208; 8 FCR 213; 60 ALR 701] when he
said:
"Generally speaking, concepts of onus of proof used in adversary
proceedings are inapplicable in administrative proceedings in the
social
security area: (see McDonald v Director -General of Social Security ) ...
However, where, as here, a breach of discipline, or something analogous, is
alleged, the onus of proving such a breach lies
upon the accuser. ..."[ [1985]
FCA 208; (1985) 8 FCR 213; 60 ALR 701 at 223; 712]
232. This passage was approved by Hill J in Casarotto v Australian
Postal Commission [[1989] FCA 116; [1989] FCA 116; (1989) 86 ALR 399; 17 ALD 321 at 412-413,
334-335] when he said that "It may be that what was said by Woodward J in
McDonald should be confined to the context of social security
legislation." [[1989] FCA 116; [1989] FCA 116; (1989) 86 ALR 399; 17 ALD 321 at 412, 334] In
Secretary, Department of Social Security v Willee [(1990) [1990] FCA 221; 96 ALR 211; 20
ALD 557] Foster J also approved the passage. In the case before him, he would
have found no error had a disciplinary committee proceeded on
the basis that the
Secretary bore the general onus of establishing the breach it had charged
[[1990] FCA 221; [1990] FCA 221; (1990) 96 ALR 211; 20 ALD 557 at 221, 560] His Honour said:
"... In my opinion, in a de novo hearing, the person in the position of
prosecutor bears the overall onus of establishing not only
the offence but also
all the facts upon which he seeks to rely for the grounding of a penalty of a
particular nature. ..." [[1990]
FCA 221; [1990] FCA 221; (1990) 96 ALR 211; 20 ALD 557 at 221,
560]
233. No mention was made in any of these cases of the judgment of Fox J in
Minister for Health v Thomson ...
234. The Trustee and the Applicants referred also to two earlier High
Court cases. The second of those cases was Unity Insurance Brokers Pty Ltd v
Rocco Pezzano Pty Ltd [[1998] HCA 38; [1998] HCA 38; (1998) 192 CLR 603; 154 ALR 361]. It
concerned proceedings originally taken in the Supreme Court of Western Australia
under the Insurance Contracts Act 1984. It does not relate to merits
review. The first does concern merits review. It is The Commonwealth v
Muratore [(1978) [1978] HCA 47; 141 CLR 296; 22 ALR 176] in which the High Court considered
an application for judicial review of a determination made under the
Compensation (Commonwealth Employees) Act 1971. Jacobs J, with whom
Gibbs, Stephen and Aickin JJ agreed, said of allegations made by the
Commonwealth that an employee is either
physically able to earn in some suitable
employment an amount not less than that employee's former weekly pay at the date
of injury
or is not physically incapacitated for work:
"... In both situations the Commonwealth is, or would be, alleging that
the circumstances of the employee had changed; and the onus
lies upon the party
alleging the change of circumstances to prove it. The position is quire [sic]
different if there has been no
previous finding of partial incapacity with a
consequent assessment of the compensation payable. It is established that the
employee
then bears the onus of proving the partial incapacity for work and its
reflection in the degree of his ability to earn ..." [[1978]
HCA 47; [1978] HCA 47; (1978) 141
CLR 296; 22 ALR 176 at 302, 180]
235. The submission made by the Trustee and the Applicants gives us the
impression that it is underpinned by notions of a legal burden
or onus of proof.
If that is so, we cannot accept it for none of the cases goes so far. In the
first instance, neither party bears
a legal onus of proof in the Tribunal unless
the legislation governing the decision under review provides to the contrary.
That was
made clear by Woodward J in McDonald v Director -General of Social
Services . This is not contradicted by the subsequent cases and, in
particular, is not contradicted by Beaumont J's judgment in Minister for
Health v Thomson . His Honour was speaking of the practical reality that the
party wanting to change the status quo must ensure that the relevant evidence
is
brought to the Tribunal to consider. The party may introduce the evidence, may
draw it out in cross-examination of the other party's
witnesses or trust that
the other party will produce it.
- Whilst
I accept that there is disagreement in Thompson as to the allocation of
the onus of proof, it is significant to me that the Commissioner is alleging a
change of circumstance. I consider
that the onus lies upon the party alleging
that change of circumstance to prove it. It is also significant that the
Commissioner
is alleging that he has material directly concerning Peter and AVS
GC which he contends justifies revoking the licences. I consider
the onus lies
upon the party alleging that such conduct has occurred or circumstances exist to
prove it. Accordingly, I consider
that the Commissioner has the onus of proof to
establish to the requisite standard that:
1.Peter was a "close associate";
2.Tony failed to disclose that Peter was a "close associate";
That the failure to do so was a breach of a condition of the licence;
4.Peter and AVS GC are no longer fit and proper persons for the purposes
of holding a licence under the Act.
Reasons for refusing applications dated 6 April 2011
- On
6 April 2011 counsel for the Applicants made several applications arising out of
the Tribunal's ruling on 31 March 2011 disallowing
a question asked of Mr
Cameron Smith in cross-examination. The Applicants sought the following:
(a)request, not pursuant to s 89 of the ADT Act, but pursuant to s
73(4)(b) of the ADT Act, that the Tribunal explain to them its reasons for
disallowing the proposed line of questioning;
(b)renew their application, pursuant to s 58(2) of the ADT Act, for a
direction that they be given a copy of so much of the statement of reasons
lodged with the Tribunal pursuant to s 58(1)(b) of the ADT Act as consists only
of the Commissioner's statement of reasons for satisfaction that a condition of
the relevant master licence has
been breached by failure to disclose particulars
of Peter Sleiman as a close associate;
(c)apply, pursuant to s 84(1)(b) of the ADT Act, for a direction that the
Registrar issue a summons to the Commissioner of Police to attend and produce
(on a date to be determined
by the Tribunal) copies of every database entry, and
of any other "document" (as defined in the Dictionary to the Evidence Act 1995)
whatsoever in his possession, or under his control, being or evidencing material
to which the Commissioner, or his delegate, had
regard in determining whether he
was satisfied that a condition of security master licence number 409404756 had
been contravened
by reason of failure to disclose particulars of a "close
associate"; and
(d)request, pursuant to s 73(4)(b) of the ADT Act, that, if the Tribunal
refuses any or all of the foregoing requests and/or applications, the Tribunal
explain in each case its reasons
for such refusal.
- I
refused to grant the orders sought in items (a), (b) and (c) of that
application.
- [Not
for publication]
The Issue of Close Association
- The
Commissioner's notice of revocation alleges that Peter is a "close associate" of
AVS GA. The Commissioner also contends that Peter
is a "close associate" of
Tony. This latter contention does not appear in the Notice of Revocation. The
Commissioner contends that
there is an undisclosed association, impacting upon
Tony as a fit and proper person.
- As
noted above, section 15(5) of the Act provides:
(5) Except as provided by the regulations, a reference in this section to
an applicant includes, in the case of an application for
a master licence, a
reference to each close associate of the applicant.
- The
meaning of the expression "close associate" is set out in section 5 of the Act
as follows:
5 Meaning of "close associate"
(1) For the purposes of this Act, a person is a close associate of an
applicant for, or the holder of, a licence if the person:
(a) holds or will hold any relevant financial interest, or is or will be
entitled to exercise any relevant power (whether in his or
her own right or on
behalf of any other person), in the business of the licence applicant or holder,
and by virtue of that interest
or power is or will be able (in the opinion of
the Commissioner) to exercise a significant influence over or with respect to
the
conduct of that business, or
(b) holds or will hold any relevant position, whether in his or her own
right or on behalf of any other person, in the business of
the licence applicant
or holder.
(2) In this section:
relevant financial interest in relation to a business means:
(a) any share in the capital of the business, or
(b) any entitlement to receive any income derived from the business,
whether the entitlement arises at law or in equity or otherwise.
relevant position means the position of director, manager, and other
executive positions and secretary, however those positions are designated, and
such other positions as may be prescribed by the regulations for the purposes of
this definition.
relevant power means any power, whether exercisable by voting or otherwise
and whether exercisable alone or in association with others:
(a) to participate in any directorial, managerial or executive decision,
or
(b) to elect or appoint any person to any relevant position.
- The
Commissioner must satisfy the Tribunal that:
(a)Peter is, or will be, able to exercise a significant influence over the
conduct of the security business of AVS GA, and
(b)that significant influence is, or will be exercised as a result of:
(i)Peter holding or will hold a relevant financial interest in the business
of AVS GA; or
Peter being entitled, or that he will be entitled, to exercise any relevant
power in the business of AVS GA; or
(c)Peter holds, or will hold a relevant position in AVS GA business (in which
case the ability to exercise a significant influence
need not be established).
Construction of section 15(6) of the Act
- Section
15(6) of the Act authorises the Commissioner to have regard to any criminal
intelligence report or other criminal information
that is "held in relation to
the applicant" whose security licence is in issue, for the purpose of
determining whether the relevant
applicant is a fit and proper person to hold
the class of licence sought.
- Section
29(3) of the Act provides:
29 Right to seek review from Administrative Decisions Tribunal
...
(3) In determining an application for a review of any decision to refuse
to grant a licence or to revoke a licence that was made on
the ground of the
applicant not being a fit and proper person, the Administrative Decisions
Tribunal:
(a) is to ensure that it does not, in the reasons for its decision or
otherwise, disclose the existence or content of any criminal
intelligence report
or other criminal information referred to in section 15 (6) without the approval
of the Commissioner, and
(b) in order to prevent the disclosure of any such report or other
criminal information, is to receive evidence and hear argument
in the absence of
the public, the applicant for review, the applicant's representative and any
other interested party, unless the
Commissioner approves otherwise.
...
Criminal intelligence report or other criminal information
- The
expressions "criminal intelligence report" and "other criminal information" are
not defined in the Act. There has been no judicial
determination of whether a
particular item of data is or is not a criminal intelligence report or other
criminal information. However
there has been some judicial consideration of that
phrase: see for example Commissioner of Police v Gray [2009] NSWCA 49; 74 NSWLR 1 ("
Gray "); AVS Group Of Companies Pty Ltd v Commissioner Of Police
[2010] NSWCA 81 (" AVS C/A (No. 1) ").
- The
Applicants submit that for the purposes of section 15(6) of the Act, the
expression "criminal intelligence report" denotes:
- by a
professional intelligence agent acting in that capacity;
- of actual or
suspected organised criminal activity;
- that the law
obliges, or at least entitles, the Commissioner to refrain from disclosing.
- The
Applicants further submit that the expression "other criminal information"
denotes:
- information
other than a criminal intelligence report;
about actual or alleged
criminal conduct by the person in relation to whom it is held;
obtained from any source and in any form;
that the law obliges, or at least entitles, the Commissioner to refrain from
disclosing.
- It
is also submitted that in order to constitute any "criminal intelligence report
or other criminal information" that is referred
to in section 15(6), the further
elements of that subsection must be satisfied. It must be held "in relation to
the applicant" and
it must be "relevant to the activities carried out under the
class of licence sought".
- The
Commissioner submits that 'reports and Information' should be read as a single
concept, viz any information about or relating
to criminal activity, rather than
as a statement of distinct categories of such information. Support for that
submission is found
in AVS C/A (No. 1) at [169] where Campbell JA
referred to "section 15(6) information".
- He
contends that the overlap in the phrase reflects an attempt to ensure that no
category of information concerning criminal activities
the circumstances in
which criminal activities can arise and the identity of those involved and their
associates was deprived of
either probative utility for the purposes of section
15(6) or 15(7) and section 29(3) protection.
- The
rationale for the construction urged by the Commissioner is that the object of
sections 15(7) and 29(3) is that an applicant for
a licence or review of a
decision should not know about the existence or content of the police
information holdings, that the Commissioner
has about the applicant,
notwithstanding that such holdings were a reason for a decision that is adverse
to the applicant, unless
the Commissioner otherwise approves. He submits that
nothing in the context of the Act generally suggests any narrower meaning and
that a construction of 'reports and Information' that deprive some subset of
information about or relating to criminal activity of
section 15(6) use or
sections 15(7) and 29(3) protection would not advance that statutory purpose.
- The
Commissioner refers to the reference in Gray at paragraph [16] that
'[t]he Commissioner urges a broad approach to the interpretation of [what is
section 15(6)] material ..., as
this would promote the objects of the Act, by
ensuring the protection of police information holding and ensure that only
persons
of utmost integrity are granted [or hold] a licence...". The
Commissioner then submits that there is nothing in the subsequent decisions
AVS C/A (No. 1) or Commissioner of Police v Sleiman & AVS Group of
Companies Pty Ltd & Ors [2011] NSWCA 21 (" AVS C/A (No. 2) ") to
suggest such a "broad approach" is wrong. Indeed the reasons in those decisions
each suggest the submission was correct.
- The
Commissioner's view must be considered in light of the fact that the Act confers
coercive powers on the Commissioner and generally
should be construed
restrictively. I am conscious of the views expressed in FCT v Citibank Ltd
(1989) 20 FCR 404 at 433; 85 ALR 588 at 614-15, where French J adverted to
the interrelationship between the presumptions of common law rights and the will
of the legislature:
The nature of this society, and its tradition of respect for individual
freedoms, will support an approach to construction which requires
close scrutiny
and a strict reading of statutes which would otherwise remove or encroach upon
those freedoms. But where the natural
meaning of the words is clear, the will of
Parliament must be respected.
- However,
in my view the close scrutiny and strict reading of the statute supports the
Commissioner's submission that a broad approach
to the construction of the
expression "criminal intelligence report and other criminal information" is
necessary to promote the objects
of the Act. Nevertheless, in my view the
Applicants have correctly identified the separation between the concepts of
"criminal intelligence
report" and "other criminal information". One informs the
other. For example, information might be gathered from a number of sources
which
appear to be unrelated but which take on a different character and greater
significance when analysed and brought together
in a report.
- If
a broad approach is adopted in regard to the meaning of the expression 'criminal
information', the purpose to which the Commissioner
refers is met.
- I
agree with the Commissioner that the expression includes information about the
following:
(1)criminal activity,
(2)the circumstances in which criminal activity may occur or has occurred,
(3)the identity of those involved in criminal activity,
(4)the identity of those with whom the individuals involved in criminal
activity associate.
- I
also agree with the Applicants that the further elements of that subsection must
be satisfied. The criminal intelligence report
and other criminal information
must be held "in relation to the applicant" and it must be "relevant to the
activities carried out
under the class of licence sought". Whether it is so held
is an objective question for the Tribunal to determine: Gray at paragraph
[96]. For the reasons argued by the Commissioner, it is also my view that a
broad approach should be taken to the construction
of those expressions.
- In
the remainder of these reasons, unless the context requires otherwise, I will
refer to 'criminal intelligence report or other criminal
information'
collectively as 'section 15(6) material'.
Having regard to section 15(6) material
The Applicants' submission
- The
Applicants contend that neither the Commissioner, nor the Tribunal, is
authorised to have regard to any section 15(6) material
for any purpose other
than "determining whether the applicant is a fit and proper person" to hold a
relevant class of licence. It
is submitted that neither the Commissioner, nor
the Tribunal, has authority to have regard to section 15(6) material for the
purpose
of determining generally whether a security licence should be granted or
refused. Therefore, so long as the existence of the alleged
close association
remains to be determined, use of any section 15(6) material for the purpose of
determining its existence would
neither be, nor be deemed to be, use "for the
purpose of determining whether an applicant is a fit and proper person" and
hence would
not be authorised by section 15(6).
- It
is further submitted that the section confers such authority only for the
purpose of determining a specific question, which, if
determined adversely to an
applicant, is a mandatory ground for refusal. In support of that submission the
Applicants rely on views
expressed in Anthony Hordern & Sons Ltd v
Amalgamated Clothing and Allied Trades Union of Australia [1932] HCA 9; (1932) 47 CLR 1 at
7.7 per Gavan Duffy CJ & Dixon J:
"When the legislature explicitly gives a power by a particular provision
which prescribes the mode in which it shall be exercised
and the conditions and
restrictions which must be observed, it excludes the operation of general
expressions in the same instrument
which might otherwise have been relied upon
for the same power".
- Whether
the Anthony Hordern principle applies "[i]n every case ... will depend on
the precise character of the relevant provisions and on the context in which
they are found": Leon Fink Holdings Pty Ltd v Australian Film Commission
(1979) 141 CLR 672 at 680 per Mason J.
- The
Applicants contend that in the present case, the purposive limitation on the
function that section 15(6) confers must be construed
in the relevant context of
sections 15(7) and 29(3) of the Act. It is submitted that this leads to the
construction that section
15(6) material cannot be used for the purpose of
determining the existence of the alleged close association.
The Commissioner's submission
- The
Commissioner contends that Tony's fitness and propriety to be and remain the
holder of his licence is to be determined by reference
to the fitness and
propriety of his "close associates" to be such a licensee.
- It
is submitted that in assessing the suitability of a master licence holder,
sub-section 15(5) permits the Commissioner to consider
a wider scope of
materials to better enable the Commissioner to assess whether an applicant is
influenced, as a consequence of his/her
association, by another.
- The
Commissioner argues that the proper intent of the provision is to enable the
Commissioner to inform himself from information relevant
to the suitability of
the applicant for a master licence. It is consistent with this legislative
purpose that the proper construction
of sub-section 15(5) is to permit the use
of section 15(6) material in the assessment of whether a person is a close
associate of
an applicant. It is submitted that to construe otherwise would mean
that there is no purpose achieved by extending the application
of the term
'applicant' to include 'each close associate of the applicant'.
- The
Commissioner submits that section 15(1)(a) is to be construed as follows:
"15(1)(a) The Commissioner must refuse to grant an application ... if the
Commissioner is satisfied that the applicant [including
each close associate of
the applicant]:
(a)is not a fit and proper person to hold the class of licence sought by
the applicant".
- For
the same reasons, the Commissioner submits that section 15(6) is to be construed
as follows:
"15(6) For the purpose of determining whether an applicant [including each
close associate of the applicant] is a fit and proper person
to hold the class
of licence sought by the applicant, the Commissioner may have regard to any
criminal intelligence report or other
criminal information held in relation to
the applicant [including each close associate of the applicant] that:
(a)is relevant to the activities carried out under the class of licence
sought by the applicant, or
(b)causes the Commissioner to conclude that improper conduct is likely to
occur if the applicant [including any close associate of
the applicant] were
granted the licence, or
(c)causes the Commissioner not to have confidence that improper conduct
will not occur if the applicant were granted the licence."
- Alternatively,
the Commissioner submits that section 15(5) can be viewed as making each close
associate of the nominal applicant itself
a notional joint applicant for the
licence sought. The Commissioner contends that on either approach, Tony's
fitness and propriety
to be the holder of a licence is to be determined by
reference to the fitness and propriety of his "close associates" to be such
a
licensee.
- In
support of that view, the Commissioner argues that Information that he obtained
about an applicant's associations with others is
information 'held in relation
to' the applicant. Further, that or other information held by the Commissioner
may suggest that those
associates either:
(1)engage in criminal activity, or
(2)are themselves associates of persons who engage in or are associated
with criminal activity.
- The
Commissioner submits that if that were the case, then the information held by
the Commissioner is "criminal information held in
relation to ... " the
applicant because of his association with those persons.
- Further,
the Commissioner submits that as reports and information about an association
between persons will very commonly, but to
varying degree, be informative as to
the nature and purpose of the association it is "improbable" that section 15(6)
was not intended
to permit recourse to reports and information
(1)for the purpose of identifying the fact an applicant's associations with
those who engage in criminal activity, but
(2)not for the purpose of identifying the nature and purpose of the
association, which may be innocent or sinister.
- If
it is accepted that reports and information may be used as evidence of the
nature and purpose of an association between an applicant
and another, then
there is no reason why that information cannot be used in determining whether
the association is a "close association"
for the purposes of section 15(6).
- There
is nothing in the terms of section 15(6) that suggests 'criminal intelligence
report or other criminal information' may not
be used at every step the
provision requires for a determination of fitness and propriety.
- The
determination of whether there is a "close association" between an applicant and
another individual, because of the operation
of section 15(5), is made "For the
purpose of determining whether an applicant 'including each close associate of
the applicant'
is a fit and proper person".
- In
summary, the Commissioner contends that, as the fitness and propriety of an
applicant holding his master licence is to be decided
by reference to the
fitness and propriety of his close associates,
(1)evidence of his association with another individual is material held in
relation to him because he is its direct subject, and
(2)evidence held about any close associate is evidence held in relation to
him for the purposes of section 15(6) because, although
he may not be the or a
subject of that material, his close associate is, and
The terms of section 15(6) do not require that any putative close association
be proved only by material which is not "criminal intelligence
report or other
criminal information".
Discussion
- I
agree with the Commissioner in regard to this issue. In my view, that
construction is consistent with the legislative intent of
section 15.
- In
making these findings I have been conscious of the remarks in FCT v Citibank
Ltd referred to above and the similar remarks of the Chief Justice in
K-Generation Pty Ltd v Liquor Licensing Court [2009] HCA 4; (2009) 252
ALR 471 at [84] where his Honour said:
"There is also a well established and conservative principle of
interpretation that statutes are construed, where constructional choices
are
open, so that they do not encroach upon fundamental rights and freedoms at
common law. That is to say, there is a presumption
against a parliamentary
intention to infringe upon such rights and freedoms."
- Section
15 prescribes criteria for suitability of a licence holder. Specifically, in
assessing the suitability of a master licence
holder, section 15(5) permits the
Commissioner to consider a wider scope of materials to better enable the
Commissioner to assess
whether an applicant is influenced, as a consequence of
his/her association, by another.
- The
proper intent of the provision is to enable the Commissioner to inform himself
from information relevant to the suitability of
the applicant for a master
licence. It is consistent with this legislative purpose that the proper
construction of section 15(5)
is to permit section 15(6) material in the
assessment of whether a person is a close associate of the applicant. To
construe otherwise
would mean that no purpose is achieved by extending the
application of the term 'applicant' to include 'each close associate of the
applicant'.
- In
my view, material, if any, tendered on the issue of Peter's fitness and
propriety, and material, if any, which comes within section
29(3) of the Act may
be relied upon in the determination of the issue of "close association". The use
of material, if any, relevant
to Peter's fitness and propriety does not
eliminate the operation of section 29(3) the Act.
- Consistently
with the approach that I have adopted in these proceedings I do not propose to
indicate whether or not I have referred
to section 15(6) material in the
assessment of whether Peter is a "close associate" of Tony or of AVS GA.
Confidential Exhibit C6B
- The
Applicants have sought reasons for the Tribunal's ruling that the part of
Confidential Exhibit C6B ("the C6B documents") that
has been disclosed to the
review Applicants is material referred to in section 15(6) of the Act.
- It
is submitted on behalf of the Applicants that the Commissioner did not have
regard to the C6B documents in deciding that Peter
was not a fit and proper
person to hold a security licence. The Commissioner accordingly has not used the
subject documents in a
manner that brings them within the scope of reference of
section 15(6) of the Act. Further, the Tribunal has not had regard to the
C6B
documents, and may never have regard to them, for the purpose of determining
whether Peter is a fit and proper person to hold
a security licence. The
Tribunal accordingly has not used the subject documents in a manner that brings
them within the scope of
reference of section 15(6) of the Act.
- It
is submitted that since the C6B documents have not been used for a purpose to
which section 15(6) of the Act refers, they cannot
at the present time be
documents "referred to in section 15(6)" within the meaning of section 29(3) of
the Act.
- I
do not agree with that narrow construction of the Act. At the time the issue
arose for consideration by the Tribunal, it was open
to the Commissioner to
place the C6B documents before the Tribunal for consideration for "the purpose
of determining whether an applicant
is a fit and proper person to hold the class
of licence sought by the applicant". It became necessary to form an opinion with
respect
to whether the C6B documents comprised "criminal intelligence report or
other criminal information held in relation to the applicant".
I in fact formed
the view that the C6B documents met that description. In doing so, I adopted the
view that a broad approach should
be taken to the construction of the expression
"held in relation to the applicant".
- In
my view, the C6B documents are relevant to the particular purpose for which
section 15(6) authorizes use of the material. I do
not agree with the
Applicants' submission that information provided by an applicant necessarily
falls outside the scope of reference
of section 15(6) of the Act. In my view,
information need not be detrimental to an applicant's case to fall within the
scope of the
section.
Confidential Exhibit C18
- The
Applicants have sought reasons for the Tribunal's ruling that Confidential
Exhibit C18 ("the C18 material") is material referred
to in s 15(6) of the
Security Industry Act.
- As
was the case with the C6B documents it became necessary that I form an opinion
with respect to whether the C18 material comprised
"criminal intelligence report
or other criminal information held in relation to the applicant". I in fact
formed the view that the
C18 material met that description. In doing so, I
adopted a broad approach should be taken to the construction of the expression
"held in relation to the applicant".
- [Not
for publication]
Commissioner's Outline of his 'Close Association' case
- The
Commissioner contends that Peter is a 'close associate' of Tony and/or AVS GA.
- Close
association will be established if the evidence discloses that Peter
(1) held a relevant "financial interest", or
(2) was 'entitled to exercise a relevant power',
in the business carried on under the Tony/AVS GA licence (the "AVS GA
Business") and in either case is or will be able (in the opinion
of the
Commissioner) to exercise a significant influence over or with respect to the
conduct of that business, or
(3) held a relevant position in that business.
- The
Commissioner's case is that
(1) there is evidence of specific occasions throughout the period of the
existence of the Tony/AVS GA licence of Peter exercising
'directorial,
managerial or executive' authority in the AVS GA Business,
(2) it is to be inferred from that evidence that Peter
(a) was entitled to exercise a relevant power, and/or
(b) held a relevant position, in that business, and
(3) the evidence in (1) considered with the balance of the evidence permits
conclusions in terms of each of (2) to (3) above.
- As
to (3) above, the Commissioner contends that the evidence discloses
(1) the operation of an entity operating commercially as 'AVS' and/or
'Australian Venue Security'.
(2) prior to October 2006 Peter
(a) held a financial interest,
(b) exercised a power, and
(c) held a position,
in the business of AVS, and in particular that part of it that thereafter
became the AVS GA Business,
(3) that interest, power and position was in each case what is defined in the
Act as a 'relevant financial interest', relevant power'
and 'relevant position',
and
(4) AVS GA and AVS GC each being manifestations of the AVS entity,
- Alternatively,
the Commissioner contends that the evidence of Tony that is to the effect that
he is in effect in sole ownership and
control of AVS GA and the AVS GA Business,
i.e. that no-else else has been relevantly financially interested, empowered or
positioned
in that business, should not be accepted, the consequences being,
(1) that AVS GA has a close associate the identity of whom has not been
disclosed, and
(2) for that reason
(a) each of AVS GA and Tony is not a fit and proper person to be the holder
of a licence; in which event the licence must be revoked,
or
(b) for the reason in (1) above alone, the licence should be revoked.
- Alternatively,
the Commissioner contends that in the event that the Tribunal finds that Peter
(1) is not a 'close associate' of Tony/AVS GA, but
(2) is nevertheless involved in directorial, managerial or executive
functions in the AVS GA Business, or otherwise in full or partial
control of
that business,
it cannot then proceed to allow the Application for Review and set aside the
Commissioner's revocation of the Applicants' master licence.
- In
the circumstances of those findings, the Commissioner contends that the Tribunal
is constrained to consider whether Peter is a
fit and proper person to be
(1) a holder of a licence under the Act, or
(2) involved in the AVS GA Business.
- If
the Tribunal finds that Peter is not so fit and proper the Tribunal must
consider whether
(1) Tony's permitting or acquiescing in Peter being so involved, reveals
himself and/or AVS GA to be not a fit and proper person to
hold the licence, and
(2) it should confirm the revocation of the Tony/AVS GA licence on the ground
that it is not in the public interest that it continue
to be held by Tony/AVS
GA.
Relevant Power
- Firstly
the Commissioner relies upon evidence of specific occasions throughout the
period of the existence of the licence of AVS GA
where Peter exercised "...
directorial, managerial or executive ..." authority in the business of AVS GA.
The Commissioner argues
that it is to be inferred from the evidence of those
specific occasions that Peter was entitled to exercise a relevant power, and/or
held a relevant position in that business.
- In
so far as the Commissioner's submission that the evidence allows an inference
that Peter was entitled to exercise a relevant power in the business of
AVS GA, it was developed such that the Commissioner was contending that Peter
exercised
de facto managerial authority over the business of AVS GA after
October 2006. The contention is that the entitlement to do so was based
upon a construction of section 5(2) in which relevant power is defined. For
present purposes it is necessary to
determine, in the context of the definition
that ""relevant power" means any power, whether exercisable by voting or
otherwise ...",
what affect the phrase "or otherwise" has upon the construction
of the breadth of the definition. The phrase qualifies the word "power".
It
follows that it cannot import into the definition of "relevant power' anything
that is not a power.
- In
Avilion Group Pty Ltd v Commissioner of Police, NSW Police (GD) (No 2 )
[2010] NSWADTAP 56 (" Avilion AP ") the Appeal Panel considered the
construction of section 5(1)(a) and specifically the word "entitled". The Appeal
Panel held that:
83 This question of the scope of the term 'entitled' in section 5(1)(a) of
the SI Act is not an easy one. Our conclusion with regard
to it is that, despite
the force of some of the arguments put by Mr Bourke, the intention of the Act is
that the term should be confined
to 'entitlements' that are capable of
enforcement by legal means. We base this conclusion on the following
considerations:-
(i) The dictionary definitions cited to us, together with the dicta
described above, delineate a concept that embraces legal rights
and 'just
claims' but stops short of de facto powers.
(ii) In section 5(1)(a), the phrase 'is or will be entitled to exercise
any relevant power' is followed immediately by a phrase suggesting
legal
entitlement - i.e., 'whether in his or her own right or on behalf of any other
person'.
(iii) To characterise as an 'entitlement' the form of 'surreptitious'
controlling influence that the Tribunal found Mr Blissett to
be able to exercise
over Avilion takes the term 'entitlement' a long way outside the realm of legal
rights and 'just claims'.
(iv) There are a number of forms of legal entitlement - for example, a
purely contractual right, enforceable through an action for
damages - under
which a person might participate in the management decisions of a company
without being formally appointed to a recognised
position within the company,
such as that of director or manager. For this reason, restricting 'entitlement'
in section 5(1)(a) to
legal entitlements does not narrow the scope of 'relevant
power' to the extent that it is effectively synonymous with 'relevant position'.
(v) If the legislature had wished, in this part of the definition of
'close associate', to refer to situations where a person actually
exercises - as
opposed to being entitled to exercise - a significant influence over decisions
made by a license applicant or holder,
it could very easily have used language
that made this clear.
(vi) As the Tribunal's decision illustrates, the 'public interest' ground
on which it separately based its decision to confirm the
Commissioner's
revocation of Avilion's licence may, in appropriate circumstances, cover the
situation where an unsuitable person
exercises a significant influence over the
conduct of the business of a licence holder, but has no 'entitlement' to
exercise such
influence.
(vii) The legislature's use of the term 'entitled' actually brings within
the ambit of 'close associate' persons who at the relevant
time do not exercise
such influence, but are merely 'entitled' to do so. The task of proving that a
person is 'entitled' to exercise
a 'relevant power' and for that reason is or
will be 'able' to exercise a significant influence over the conduct of the
business
of the licence applicant or holder may sometimes be easier than proving
that he/she does in fact exercise such influence.
- The
Appeal Panel's conclusion is contrary to the first construction advanced by the
Commissioner. The ability of a person to influence
a business in the nature of
one family member upon another does not amount to an entitlement to exercise a
relevant power.
- The
Appeal Panel's decision was the subject of appeal to the Court of Appeal:
Avilion Group Pty Ltd v Commissioner of Police [2010] NSWCA 275. The
appeal was dismissed. However, Allsop P stated at paragraphs [3] - [4]:
3 As to the question of "close associate", a difference of view arose
principally by reference to the phrase "entitled to control"
in s 5 as
applicable to the facts and by reason of a holding of a relevant position.
4 The correctness of the approach of the Appeal Panel would arise if one
or more of the grounds is or are upheld. For the reasons
that follow, I am of
the view that none of the appeal grounds has merit. It is, therefore,
unnecessary to deal with the notice of
contention. However, it is appropriate to
say this, with respect to the members, that the lack of dealing with the notice
of contention
should not be taken as my agreement with the Appeal Panel's
approach to the operation of the definition of "close associate".
- In
the Commissioner's submission, the Appeal Panel wrongly decided the issue of the
scope of the term 'entitled' in section 5(1)(a)
of the Act. I note that the
Court of Appeal left the issue open. However, I do not consider that this is the
correct forum to revisit
that issue.
- In
relation to the Commissioner's further submission that Peter was the true
controlling mind, I note that the status of the evidence
in this matter is
different from that with which the Appeal Panel dealt in Avilion AP .
- Although
the Appeal Panel in Avilion AP rejected the submission that the criteria
had been met in section 5(2) as the evidence as to the nature of the position of
Mr Blissett
was less clear, the Appeal Panel declined to substitute its own
decision for that of the Tribunal's given the evidence of the level
of control
exercised by Mr Blissett in the business of Avilion. The Appeal Panel was
unwilling to do so, not as a matter of construction,
but as a matter of
procedure. The Appeal Panel was confined to questions of law. The Appeal Panel
did not otherwise address the scope
of the phrase "relevant position".
- In
this matter, the evidence as to Peter's activities is clear. The dispute between
the parties is primarily about how those activities
are to be interpreted.
Holds or will hold any relevant position
- In
my view, the Appeal Panel decision in Avilion AP is not authority for the
proper construction of the expression "holds or will hold any relevant
position". It does not preclude the
construction urged by the Commissioner to
the effect that an individual exercising control over a business holds a
relevant position.
- The
Commissioner argues that there is no basis for importing the requirement of
"entitlement" into section 5(1)(b). If the Commissioner's
submission is correct,
the scope of the provision could extend to a circumstance where an individual
was able to influence a person
with that legally enforceable entitlement. If the
further submission is correct, the phrase in section 5 (1)(b) " and other
executive position " is to be given an expansive construction such that it
includes an individual acting in a role approximating a managerial role in
the
business. The Commissioner contends that such a construction promotes the
purpose of the Act to prevent persons who are not fit
and proper to hold a
licence from acting on behalf of a security business.
- Section
9 of the Corporations Act defines director as:
"director" of a company or other body means:
(a)a person who:
(i) is appointed to the position of a director; or
(ii) is appointed to the position of an alternate director and is acting
in that capacity;
regardless of the name that is given to their position; and
(b) unless the contrary intention appears, a person who is not validly
appointed as a director if:
(i) they act in the position of a director; or
(ii) the directors of the company or body are accustomed to act in
accordance with the person's instructions or wishes.
Subparagraph (b)(ii) does not apply merely because the directors act on
advice given by the person in the proper performance of functions
attaching to
the person's professional capacity, or the person's business relationship with
the directors or the company or body.
- The
Applicants argue that if the Act was intended to include de facto directors or
shadow directors within the ambit of "close associates"
of a security business,
it would have enacted provisions comparable to section 9(b)(i) or (b)(ii) of the
Corporations Act . It did not do so.
- I
agree with that submission insofar as it relates to the position of directors.
However, in my view the standpoint in regard to the
proper construction of the
expression " and other executive position " is not so clear.
- In
Corporate Affairs Commission (NSW) v Yuill [1991] HCA 28; (1991) 65 ALJR 500 Brennan J
approved the approach to statutory construction of Lord Reid in Black-Clawson
Ltd v Papierwerke AG [1975] UKHL 2; [1975] AC 591
We often say that we are looking for the intention of Parliament, but that
is not quite accurate. We are seeking the meaning of the
words which Parliament
used. We are seeking not what Parliament meant, but the true meaning of what
they said
- However,
Lord Simon of Glaisdale explained in that case:
... if the draftsman uses the tools of his trade correctly, the meaning of
his words should actually represent what their promulgator
meant to say. And the
court of construction, retracing the same path in the opposite direction, should
arrive, via the meaning of
what was said, at what the promulgator meant to say
...
- The
courts are duty bound to give effect to the words of the legislature: Sorby v
Commonwealth [1983] HCA 10; (1983) 152 CLR 281 at 322. It is only when a rule of
construction fails to yield the effect that the court considers the legislature
intended by its
words, that it is permissible to consider a new rule of
construction better fitted to the considered intention: Bropho v Western
Australia [1990] HCA 24; (1990) 171 CLR 1. Although in a dissenting decision in Yuill
, Gaudron J said at 508:
The difficulty inherent in the notion of "the intention of the
legislature" dictates that, save where there are settled rules or where
there is
some feature of the legislation requiring otherwise, the legislature should be
taken to have said what it meant and to have
meant what it said. Or, more
accurately in terms of legal principle, the words of the statute should be taken
to bear their natural
and ordinary meaning.
- The
Applicants referred to Cockerell v Fry (1967) LGRA 164 in which McInerney
J held at 178 that holding office is ordinarily regarded as following
appointment; not the exercise
of its functions without having been formally
appointed.
- It
is submitted that the Commissioner must establish, directly or inferentially,
that Peter "held" the position of a director, manager,
executive or secretary in
the AVS GA business in the legally relevant sense of being duly appointed to one
or more of those positions,
and consequently entitled to exercise the privileges
that such appointment conferred. Further, it is submitted that the evidence
in
these proceedings could not reasonably satisfy the Tribunal that Peter, at any
time after October 2006, "held", in that legally
relevant sense, any "relevant
position" in the business of AVS GA.
- In
my view, circumstances exist in this matter that take it out of the ordinary. I
consider that the circumstances in which an individual
with a legally
enforceable entitlement permits an individual without such an entitlement to
exercise a significant influence over
or with respect to the conduct of that
business permit the departure from the usual situation referred to in
Cockerell v Fry .
- In
the circumstances of a family business arrangement, directors commonly are
formally appointed. However, it is less likely that
individuals will be formally
appointed to other roles within a family business than in the wider commercial
sphere.
- In
my view, the close scrutiny and a strict reading urged by French J in FCT v
Citibank Ltd supports the Commissioner's contention. The use of the words
"manager, and other executive positions and secretary, however those
positions
are designated" in section 5 of the Act suggests to me that the legislature
intended that an official title is not conclusive
of the issue. The actual role
played by an individual must be considered to determine whether or not the
duties can reasonably considered
as falling within the scope of one or more of
those positions.
- It
is not necessary that the Commissioner establish that Peter "held" a "relevant
position" in the business of AVS GA in the legally
relevant sense. It is
sufficient if the Commissioner establishes that Peter exercised the functions of
such a position without having
been formally appointed.
- That
construction of the provision promotes the purpose of the Act to prevent persons
who are not fit and proper to hold a licence
from acting on behalf of a security
business.
Relevant financial interest
- Secondly,
the Commissioner submits that the balance of the evidence discloses that AVS GA
was the same entity as a previously operating
entity, Australian Venue Security
("AVS") in which Peter held a financial interest, exercised power and held a
position prior to
October 2006. The Commissioner contends that AVS GA's business
is in reality the business of AVS but by a different name. In order
that this
contention be accepted, it is necessary to find that the interest, power and
position be a relevant financial interest,
a relevant power and a relevant
position within section 5 the Act, and that AVS GA is AVS but by a different
name.
- It
is not in issue that as and from 23 August 2006 Peter did not hold any share in
the capital of AVS GA and following 17 October
2006 there is no evidence that
the income of AVS GA was paid to entities owned or controlled by Peter. The
evidence does not disclose
any interest in the capital of AVS GA or an
entitlement to the income of AVS GA after October 2006, other than receipt of
monies
by the AVS GA Trust from income derived by AVS GA. It is the
characterization of Peter's beneficial entitlement under the Trust Deed
that
warrants consideration, as this is the basis for the assertion of his having a
relevant financial interest in the business of
AVS GA.
- The
Applicants contend that the assessment of whether an individual holds or will
hold a relevant financial interest and thereby is
able to influence the business
of a licensee is confined to either a share in the capital of a business or an
entitlement as described
in section 5(2)(b) of the Act; the entitlements being
confined to those capable of enforcement by legal means. The Applicants contend
that more than the influence of one family member (Peter) over another (Tony) is
necessary for the entitlement described in section
5(2)(b).
- The
Commissioner submits that Tony and Peter were business partners in AVS GA before
October 2006. However the evidence underlying
that submission must be read with
the balance of Tony's evidence, viz from 22 August 2006 Tony owned and
controlled AVS GA, which
owned the good will of the business of AVS from 21
October 2006. Prior to 21 October 2006 Tony had no entitlement to any of the
profits
of the business of AVS.
- The
Commissioner submits that the inclusion in section 5(2)(b) of entitlements
arising ' at law or in equity or otherwise' extends the entitlement from
that which is enforceable at law or in equity to that of one where the
entitlement to receive income
arises, in this case, beneficially from either AVS
GA Trust or the Sly Fox Family Trust of which Tony is the appointor and the
specified
beneficiary.
- The
terms of the Sly Fox Family Trust Deed are identical to AVS GA Trust Deed.
O'Malley's Hotel is a venture of the Sly Fox Family
Trust of which Peter was a
beneficiary since the acquisition of O'Malley's Hotel. The inference the
Commissioner asks to be drawn
is that as O'Malley's Hotel is Peter's and he is
able to significantly influence the operation of that hotel, his designation as
a beneficiary of the Sly Fox Family Trust is indistinguishable from his
designation as a beneficiary of the AVS GA Trust such that
he is able to
significantly influence the operation of AVS GA.
- However,
in this regard, l note that AVS GA Trust is a discretionary trust; a general
beneficiary of a discretionary trust has no
vested interest in the trust
property, and no entitlement to receive any part of the trust income. Until such
time as a distribution
is made in Peter's favour, the only entitlement of a
general beneficiary is an entitlement to be considered for such a distribution:
Garside v Inland Revenue Commissioners [1967] UKHL 6; [1968] AC 553 per Lord Reid at
607. The Applicants contend, and I agree, that even if a discretionary
distribution were made, it would not be a
correct characterization of that
distribution as an entitlement from the business of AVS GA.
- In
the absence of evidence disclosing an entitlement to income other than that as a
beneficiary to a discretionary trust, I find that
Peter had no relevant
financial interest in the business of AVS GA after October 2006.
An Undisclosed Unidentified Close Associate
- Thirdly,
the Commissioner contends that the Tribunal would reject Tony's evidence that he
owns and controls AVS GA such that no-one
else has a relevant financial
interest, exercises a relevant power, or occupies a relevant position in the
business of AVS GA. the
Commissioner submits that if the evidence does not
permit a finding that Peter is the close associate of AVS GA, but the evidence
does support a finding that there is an undisclosed close associate, the Act
entitles the Commissioner to revoke the licence, and
Tony is not a fit and
proper person to be the holder of a licence.
- Clause
13(3)(c)(ii) of the Security Industry Regulations 2007 ("the
Regulations") obliges a corporation seeking a master licence to disclose a close
associate of the applicant. Clause 13(3)
provides:
13 Information and particulars to accompany licence application: section
14 (2) (b)
...
(3) Master licences-corporations
For the purposes of section 14 (2) (b) of the Act, an application for a
master licence that is made by a corporation (other than a
government agency or
public authority) must include the following information:
(a) the name of the applicant,
(b) the applicant's Australian Business Number and Australian Company
Number and each business name (within the meaning of the Business Names Act
2002) under which the applicant carries on business,
(c) the nominated person for the licence, being an individual who is:
(i) an Australian citizen or permanent Australian resident, and
(ii) a close associate of the applicant, and
(iii) involved in the day-to-day conduct of the applicant's security
activities,
(d) the name, date and place of birth and residential address of each of
the applicant's close associates,
...
- Clause
34 of the Regulations obliges the licensee to disclose any change relating to
close associates of that licensee:
34 Requirement to notify changes relating to close associates
It is a condition of a master licence that the licensee must notify the
Commissioner in writing of any change in the particulars relating
to the close
associates of the licensee within 14 days after the change occurs.
- If
it is found that Tony and/or AVS GA has a close associate, and failed to
disclose that close associate, section 26(1) of the Act
entitles the
Commissioner to revoke the licence.
- Evidence
that Tony was irresponsible or incompetent in the management of AVS GA is no
substitute for affirmative evidence of another's
entitlement to exercise any
relevant power in AVS GA. The evidence does disclose an inadequacy on the part
of Tony in understanding
the distinction between a corporate entity and the
business of the corporate entity. However, in my view it does not establish that
someone other than Tony owns or controls AVS GA.
- In
light of the above findings, it is necessary that I consider the material
tendered by the parties and the arguments in relation
to the inferences that can
be drawn from that material.
The Commissioner's case on relevant position
- The
Commissioner contends that the evidence of occasions when Peter engaged in what
the Commissioner characterizes as "exercising
'... directorial, managerial or
executive...' authority" in the AVS GA business supports an inference that on
those occasions Peter
held a "relevant position" in the AVS GA business.
The licensing sergeants
- Senior
Sergeant Darren Thompson was the licensing sergeant at the Rocks from December
2003 to May 2008. This period represents both
periods of purported governance of
AVS GA by Peter and Tony i.e. either side of 21 October 2006. Sgt Thompson gave
evidence that
he had extensive contact with Peter throughout that time and only
one contact with Tony in 2004. On none of the occasions when he
met Peter did
Peter decline contact as the representative of AVS GA's NSW business, and on no
occasion did he refer Sgt Thompson
to Tony. These facts were not challenged. The
change in the business of AVS AVS to AVS GA in October 2006 did not result in
any change
in the nature or frequency of Sgt Thomson's contact with Peter.
- Constable
Randal Wood was for the period April 2007 to June 2009 the Licensing Sergeant
for the Rocks LAC. The effect of his unchallenged
evidence is that, for the
period April 2007 to May 2008, Peter was the face of AVS business undertaking
security contracts in licensed
premises at The Rocks. All the venues the subject
of this evidence were AVS GA clients.
- The
Commissioner contends that the evidence of both Sgt Thompson and Constable Wood
is further evidence of Peter continuing to perform
the same management functions
after October 2008 as before.
Operation Revocation
- In
February 2009 police undertook "Operation Revocation". Its object was to check
the licence status of persons working as "security
operatives". Constable
Katharine Graham prepared a checklist and it is to be inferred that was for the
recording of information obtained
from such operations.
- Neither
AVS GA nor AVS GC was the targets of Operation Revocation.
- On
the night of 6-7 February 2009 AVS GA guards were interviewed at two AVS GA
venues, The Argyle and Tank. Three of the guards identified
"Peter " as their
"Employer Contact person".
- The
statement of Ms Howard (nee Graham), prepared for a different purpose, asserts
that all security operatives at The Argyle and
Mr Scott Dawson were spoken to.
The Commissioner accepts that it may fairly be inferred that no other AVS GA
guard at either venue
so identified Peter.
- Clayton
Carmichael and Raymond Nanai, two of the three guards who did so identify Peter,
had been employed for approximately 12 and
6 months respectively.
- The
Commissioner submits that if Peter was not involved in the AVS GA Business in
those periods he could not have been known to Messrs
Carmichael and Nanai, as
being connected to it at all, let alone as their "employer contact". It is
further submitted that Peter
being familiar to those employed is not consistent
with his and Tony's evidence of Peter being wholly disengaged from the
management
AVS GA Business after October 2006. The evidence is much more
consistent with Peter's own assessment of himself as "... very hands
on..." in
his operations.
- The
Commissioner contends that those nominations of Peter as employer contact is
some evidence of his holding a directorial, managerial
or executive position
i.e. being relevantly positioned in the AVS GA Business.
- The
third nominator, Mr Dawson, had been employed for approximately 10 years. The
Commissioner submits that if there had been an actual
real change in the
ownership or the directorial, managerial or executive control of the business
after about August/October 2006,
it is inconceivable that Mr Dawson would not
have become aware of it; after all, hierarchically there was only an area
manager between
him and Peter/Tony.
- The
Commissioner submits that Mr Dawson's February 2009 identification of Peter
should be treated as reflecting his knowledge, as
a long-term employee, of the
operations of the business at that time.
- It
is submitted that as at 7 February 2009 there was no reason for Mr Dawson not to
have been candid in his response to the police
inquiry made. There was no reason
for the Police to have been anything but indifferent to his response. However,
the Commissioner
contends that the position is otherwise in respect of his
testimony on 10 June 2011. He was not candid, very likely he was not truthful;
certainly he was evasive, guarded and calculating in his answers. The
Commissioner submits that Mr Dawson's attempt to suggest that
the information
recorded in his checklist did not come from him should not be accepted. There
were four items that could not have
been accurately obtained from anyone else,
(1)his full name as given that evening,
(2)his status as supervisor/manager at the Argyle,
(3)his status as employee rather than contractor to AVS GA ,
(4)the duration of his employment to that time,
all of which details Mr Dawson agreed were correct.
- The
Commissioner further submits that, while slight in itself, the Operation
Revocation evidence is consistent with, and therefore
corroborative of, the
other evidence from routine police activity, and the other objective evidence
about the Peter/AVS GA association
tendered by the Commissioner. It is
inconsistent with the Applicants' case and evidence.
Ralph Guderjan
- Mr
Ralph Guderjan had dealings with Peter in relation to the provision of security
services to the venue Jackson's on George. Jackson's
on George is a long time
client of the AVS-AVS/AVS GA Business.
- Mr
Guderjan's evidence is that in the interval between October 2006 and 20 August
2010 AVS GA had not informed him of Peter's departure
from the AVS GA Business,
and it had not otherwise become apparent to him. Mr Guderjan would speak
directly to Peter about core issues
or legal level issues" although as at August
2010 he had not done so "of late".
- The
Commissioner contends that Mr Guderjan's evidence is evidence of Peter being
relevantly empowered and/or positioned in the AVS
GA Business; i.e. of Peter
being a close associate.
- Peter's
evidence does not challenge Mr Guderjan's account of their dealings. It does not
assert no contact with Mr Guderjan in the
interval between October 2006 and 20
August 2010. The Applicants do not suggest any liaison between Mr Guderjan and
Tony about "core
or high level issues".
Dean Martin
- Mr
Dean Martin has been Group Security manager with the Merrivale Group since 2005.
Mr Martin's evidence is that in about December
2008 Peter participated in
discussions/negotiations about AVS GA obtaining work at a clubbing venue known
as 'Tank'. Peter was thereafter
seen in circumstances suggestive of him having a
non-operational (ie. managerial) function in the performance of that work.
- Peter's
evidence is to the effect that the discussions/negotiations took place in two
immediately successive meetings, not one, and
that Mr Martin was not present at
the first. Mr Martin acknowledged that that was so.
- Peter's
evidence is that he introduced himself as being "from AVS Group of Companies".
Mr Martin did not concede that was so. His
recollection remained that the
introductions were in terms of "AVS". ,
- Peter's
evidence is that he was present at, but not a participant in, the
discussions/negotiations at either of the meetings. His
explanation for his
presence being that he had a personal relationship with a Mr Savage.
- Mr
Martin acknowledged that most of the discussions in the second part of the
meeting was between himself and Mr Scott Taylor, and
concerned operational,
rather than financial matters. He did not concede that there was no
participation by Peter.
- The
Commissioner submits that even if Peter's account of the second stage of the
meeting is accepted it does not establish that Peter
did not participate in the
financial arrangement made in the first phase. It is further submitted that the
evidence of Peter's persistent
involvement in the AVS GA Business after
August/October 2006 and up to December 2009 suggests the implicit explanation
for Peter
not to be involved in the financial discussions should not be
accepted.
- The
Commissioner argues that the issue about the first stage is one of credit. The
effect of Peter's own evidence is that it was he
himself who knew the guards who
were to be and who were supplied for the work, and decide that AVS GA rather
than AVS GC would obtain
the Tank work. Peter stated:
- "When
I arrived at the meeting it was my intention to permit Scott to contract for the
work directly on behalf of Group Australia".
- The
Commissioner submits that subsumed within that statement is an acknowledgement
of the capacity of Peter to direct Scott Taylor
to prefer AVS GC to AVS GA, and
prevent AVS GA from seeking and obtaining that or other work, i.e. that Peter
was relevantly empowered
or positioned in the business of AVS GA.
- No
explanation is offered for Tony's absence from the discussions/negotiations.
Tony's own evidence is that neither Peter nor Scott
Taylor ever informed him of
the occurrence of the Tank meeting. The Commissioner submits that at the least
it is surprising that
neither of Peter nor Scott Taylor ever reported the
meeting to Tony given that Peter asserts that Tony was by then the principal
of
the AVS GA Business.
- Peter
provided further (direct) evidence of him being relevantly empowered or
positioned in the AVS GA Business on multiple occasions:
(1)the guards working at Tank phoned him directly upon the advent there of
"... troublesome bikie gangs ...", a management issue,
(2)to come and help manage it,
(3)he directly acceded to each request and undertook the supervision of those
guards and the management of those situations, and
(4)did so without reference to or regard for the ostensible formal management
structure of the AVS GA Business.
- The
Commissioner submits that each of the occasions was an occasion where Peter made
and "participate[d] in [a] directorial, managerial
or executive decision" in AVS
GA Business on his own authority. It is further submitted that Peter's own
evidence is evidence to
the effect of his being a "close associate" of Tony/AVS
GA.
- The
Commissioner argues that Peter's relationship to the AVS GA "bikie troubles" at
Tank itself gives a reason to doubt the accuracy
of Peter's explanation for his
involvement in the discussion/negotiations at Tank, and illuminates the meaning
of his statement about
his capacity "to permit" that work, particularly in the
context of Tony's evidence that he was never informed of the occurrence of
the
Tank meeting.
- In
any event the Commissioner contends that to the extent that the resolution of
any conflict between Peter's testimony and that of
Mr Martin is necessary, the
matter is essentially one of credit. The Commissioner contends that Peter should
be found to have no
credit.
Cameron Smith
- Mr
Cameron Smith is the registrar of the Security Industry Registry and was
appointed on 27 October 2008 but had acted in the position
since 12 June 2007.
He gave evidence of 3 meetings that he had with Peter and Scott Taylor: 29
January 2008 (with Peter Nassif attending),
12 November 2008 (with Joe Nasr
attending) and 22 June 2009 (with Joe Nasr attending). His evidence is that
throughout those meetings
no distinction was made by any party of the various
AVS entities, the descriptor "AVS" was uniformly used, and Scott Taylor is
described
as deferring to Peter on operative issues for AVS's operations in NSW.
Peter does not dispute the use of AVS as a descriptor at these
meetings. He does
however dispute Mr Smith's evidence that Peter was introduced as 'our director',
and the staffing difficulty identified
as being AVS's difficulty. Otherwise,
Peter explains the absence of Tony and his leading role as being a consequence
of being at
the meeting on behalf of AVS GC; the meeting is said not to have
concerned the business of AVS GA.
- The
Commissioner contends that Peter's explanation should not be accepted; and if
not accepted this infers and reinforces the balance
of evidence that Peter is
relevantly financially interested, empowered and/or in a positioned in the AVS
GA business. The subject
matter of the first meeting was employment issues. As
such it could not have concerned AVS GC as its licence precludes it being an
employer. Secondly, the Commissioner contends that the presence of Joe Nasr
would be anomalous if it was for the business of AVS
GC as he was not employed
by AVS GC in November 2008. Thirdly, the Commissioner contends that the topic of
the second meeting was
Peter's purchase of Asset Security and Training Pty Ltd.
Peter does not deny the In the course of that meeting, he said:
"we can employ good quality people ... it is difficult to get good
guards."
- The
meeting did not concern the operations of AVS GC as an employer. In the context
of the operation of Asset Security and Training
Pty Ltd and the interest of AVS
GA as an employer within NSW security industry, it is inherently unlikely that
Peter would not have
distinguished AVS GA as having the staffing difficulties
rather than the industry generally.
- The
Commissioner submits that these are specific occasions throughout the period of
the existence of the licence of AVS GA where Peter
exercised "... directorial,
managerial or executive ..." authority in the business of AVS GA. The
Commissioner further argues that
it is to be inferred from the evidence of those
specific occasions that Peter was entitled to exercise a relevant power, and/or
held
a relevant position in that business.
- In
the event the account of Mr Smith is considered reliable, the conclusions
advanced by the Commissioner are available.
The Applicants' case on relevant position
- Tony's
evidence is that, for some time after October 2006, about once or twice a month,
he requested and received from Peter unpaid
advice about such matters as risk
management at hotels. Tony and Peter both gave evidence that between 2006 and
2007 or 2008, Peter
volunteered his advice to assist the AVS GA business at a
time when it was losing clients.
- It
is submitted that the role performed was advisory only. Peter attended meetings
with AVS GA clients only in the company of appointed
directors or managers of
the AVS GA business. He did not purport to make, on his own authority, any
promises binding on AVS GA. It
is further submitted that an occasional provider
of voluntary advice is not the holder of a "relevant position". putting the
evidence
at its highest, it shows that the role that Peter performed was that of
an unpaid consultant or adviser.
Evidence concerning Peter's dealings with Dean Martin
- Peter
gave additional evidence about the meeting that he attended, together with Scott
Taylor, then the State Manager of the AVS GA
business, at the Establishment
Hotel. On Peter's account, he attended the meeting at the invitation of a former
client who was also
a personal friend, and with the intention of helping out
Tony by permitting AVS GA to contract for the business rather than taking
the
business himself through AVS GC.
- Mr
Martin confirmed Peter's evidence that it was Scott Taylor, and not himself, who
did the bulk of the talking at the meeting. Peter's
evidence is that he
introduced himself as being 'from AVS Group of Companies". In cross examination,
Mr Martin conceded that Peter
might have introduced himself in those terms.
- It
is submitted for the Applicants that at its highest, the evidence is that Peter
voluntarily, and for no reward, solicited work
with the Merivale Group, for the
AVS GA business. These dealings did not involve "exercising ... authority" in
the AVS GA business.
They do not support an inference that Peter held a
"relevant position" in the AVS GA business, or that he purported to hold such
a
position, or that the lawful director of AVS GA habitually entrusted him with
directorial or managerial functions.
- Peter
and Dean Martin agree that on a small number of occasions after AVS GA entered
the Merivale contract, Peter was present at the
Bridge Lane entrance of the
"Tank" Bar in company with the AVS GA security guards. Peter says that these
were occasions when he attended
voluntarily at the request of former employees
who were also personal friends, to smooth over confrontations with bikies. Mr
Martin
was not in a position to know anything that would enable him to say
otherwise.
- It
is submitted that Peter was not "exercising ... authority" in the AVS GA
business, or purporting to do so, when he intervened at
the door of the "Tank"
Bar. He was volunteering assistance to former employees who were his friends,
and doing so at their request.
He was not purporting to be a manager, still less
a director, of the AVS GA business.
Evidence concerning Peter's dealings with Senior Sergeant Thompson
- Peter
does not dispute that he continued to have contact with Senior Sergeant Thompson
in The Rocks after October 2006 and up until
May 2008. He gave evidence that he
regularly spoke to Senior Sergeant Thompson about matters affecting licensed
venues, including
venues that were serviced by the AVS GA business. He denies,
however, ever telling anyone that he was the owner of AVS GA. Senior
Sergeant
Thompson did not say that his continuing understanding that Peter was the owner
of the AVS GA business was based on anything
Peter said, or on anything at all
other than the mere fact that, after October 2003, no-one ever told him
otherwise.
- It
is submitted that Senior Sergeant Thompson does not positively say that he can
recollect the detail of any particular dealing that
he had with Peter after
October 2006 and that this is significant. It is argued that the evidence of
Senior Sergeant Thompson is
consistent with those of his recollected dealings in
which Peter acted on behalf of the AVS GA business having all occurred during
the period prior to October 2006, and his dealings with Peter after that date
having all been dealings of the kind that Peter described.
- It
is submitted that Senior Sergeant Thompson's evidence would not enable the
Tribunal to be satisfied that Peter was "exercising
... authority" in the AVS GA
business, or purporting to do so, in any particular dealing that he had with
Senior Sergeant Thompson
after October 2006.
Submissions concerning Peter's dealings with Constable Wood
- It
is submitted for the Applicants that the Tribunal could not rationally and/or
consistently with the rules of natural justice, give
Constable Wood's
conclusions any weight at all. Those conclusions were admitted for whatever they
are worth. It is submitted that
in proceedings where the existence or otherwise
of any factual basis for conclusions to the effect of Constable Wood's
conclusions
is the central issue, those conclusions standing alone are worth
nothing.
Submissions concerning the "Operation Revocation" documents
- It
is submitted for the Applicants that while each of the three documents relate to
a person who, it may be accepted, was, in February
2009, employed by AVS GA as a
security guard, there is no evidence that the guards themselves were the sources
of the contact person
representations. Scott Dawson gave evidence that he could
not have been the source.
- It
is further submitted that there are plausible explanations for how Peter could
have come to be identified as the "Employer contact
person" in respect of the
relevant guard. Mr Dawson gave evidence that, at the time when Constable Graham
interviewed him, he was
wearing his lanyard. That lanyard is clearly marked with
the words "AVS Group of Companies". It is suggested that had Constable Graham
placed a telephone call to security industry registry and in the course of that
telephone call identified to the registry operator
that "AVS Group of Companies"
was the relevant employer, the registry operator would have been expected to
access registry records
that would identify Peter as the licensee of that
entity, and to communicate that information to Constable Graham.
- Constable
Graham was not called to give evidence. It is submitted that the Tribunal should
therefore draw the usual inference, which
is that her evidence would not have
assisted in proving that the representations as to "Employer contact person" in
the "Operation
Revocation" documents were obtained from a source, or in
circumstances, of such a kind that the Tribunal can properly give them any
weight.
Submissions concerning the evidence of Ralph Guderjan
- It
is submitted for the Applicants that there is nothing in Mr Guderjan's evidence
that the Tribunal could regard as evidence that
Peter has been a close associate
of the AVS GA business at any time after October 2006. Mr Guderjan says only
that he met Peter well
prior to October 2006, and that since that time, no-one
has positively told him that Peter is no longer in charge of the AVS GA
business.
- On
his own evidence, Mr Guderjan has "not spoken to Peter of late". The period to
which he was referring is not clear. It is submitted
that the Tribunal cannot
rationally or fairly draw any inference adverse to the Applicants from this
evidence.
Submissions concerning Cameron Smith's evidence
- It
is submitted for the Applicants that Mr Smith's evidence relevantly amounts to
nothing more than the following:
- In three
conversations that he had with Peter, he observed that Scott Taylor and David
Nassif behaved in Peter's presence as though
Peter was the boss of the entity
that Peter claimed to be speaking for, and which Mr Smith understood to be
called "AVS".
No-one who might reasonably have been expected to
have reliable knowledge of the matter ever told Mr Smith that the entity for
which
Peter was speaking, and which Mr Smith identified as "AVS", did not own
and operate the AVS GA business.
- Mr
Smith never inquired whether Peter was representing any business that currently
employed security guards, or was currently licensed
to do so in New South Wales,
and that the conversations he had with Peter were not of such a nature as to put
Peter, Scott Taylor
or anyone else on notice that Mr Smith might have expected
Tony or AVS GA to be mentioned.
- It
is further submitted that Mr Smith's evidence in regard to the website could not
responsibly be regarded as a basis for revoking
the relevant master licence on
the ground of an undisclosed 'close association'. The website is uninformative
as to the precise corporate
structure of the entities whose services it
promotes, but it does not follow that the purpose of the website is to mislead
anyone.
And even if the website had been intended to mislead someone, it would
not follow that the intention was to mislead anyone into believing
that Peter no
longer owned or controlled the business of AVS GA when in fact he did. It is
further submitted that on the evidence,
if Tony had a motive to mislead anybody
about anything after October 2006, it was a motive to mislead his customers into
believing
that Peter did still own and/or control the business of AVS GA when in
fact he did not.
The Assessment of the Credibility of Tony and Peter
- Thirdly,
the Commissioner contends that the Tribunal would reject the evidence of Peter
and Tony as to the transfer in ownership and
control of AVS GA from Peter to
Tony in August to October 2006. The Commissioner submits this on two bases.
Firstly, the transfer
of business was not ordinary dealings in the course of
commercial business activity. Secondly, the Commissioner contends that on
the
assessment of the overall credibility of Peter and Tony, neither should be
believed about a fact in issue.
- In
so far as the first of those bases, the Applicants submit that in August 2006
Peter gave AVS GA to Tony and on 21 October 2006
AVS GA obtained its current
master licence.
- The
Applicants also submit that in October 2006 Peter gave the business of AVS
Australian Venue Security Pty Ltd ("AVS AVS") to AVS
GA. The Applicants says
that, thereafter, Peter ceased to be relevantly financially interested,
empowered or positioned in AVS GA's
business.
- As
at 21 June 2006 Peter was a director and participated in executive and
managerial decisions of the security business activity carried
on under the
licence of Tony for AVS AVS. Accordingly, he held a relevant position and
exercised relevant power in the business of
AVS AVS for which Tony was the
nominee holder of the licence.
- The
ASIC search suggests that on that that day he resigned as a director and
disposed of the company to Raymond Saab. Notwithstanding
his apparent lack of
ownership and control of AVS AVS, Peter's evidence is that he gave the AVS-AVS
Business to Tony in October 2006,
and thereafter sold Australian Venue Security
Pty Ltd to Raymond Saab.
- As
at October 2006 Tony was a manager and executive, and as a consequence
participated in managerial and executive decisions of AVS
AVS. Accordingly, he
held a relevant position and exercised relevant power in the business of AVS
AVS. He had held that position
since 2002.
- For
approximately four years before October 2006 Peter and Tony shared the profits
of AVS AVS, and regarded themselves as business
partners.
- Both
Peter and Tony had relevant financial interests in the AVS AVS business as at
October 2006. As at October 2006 Peter was a close
associate of Tony and AVS
AVS.
- The
Applicants submit that AVS GA was a valueless "shelf company", and the AVS AVS
business was an asset of considerable but unquantified
value. Peter and Tony
explain the transaction as a family arrangement. In this regard, the
Commissioner contends that by reason of
the transaction having a family
arrangement quality, it is attended by casual informality, and may attach all
future dealings with
the family relationship dynamics at the time of the
transaction.
- There
is no evidence of them being effected through a contract for the sale of
business etc. the subject of warranties or adjustment
for financial Liabilities
or benefits.
- The
Commissioner submits that there is a legal but rebuttable presumption that
inter-family dealings are not intended to have contractual
or at least legal
consequences which normally attend a commercial transaction for consideration.
- In
this case Peter and Tony each gave evidence of the intensity of the family
relationships and the non-significance of their commercial
forms. Peter's
evidence is that his father charged him with responsibility for the welfare of
his immediate family shortly before
his father's death, and that he takes that
responsibility very seriously. Tony's evidence is to the effect that "it doesn't
matter
whose name is on the title; it's a family asset".
- The
Commissioner submits that the importance of the fact of the transaction of the
business being within a family context is highlighted
by the number of immediate
and extended family members that work in the Jaken Business Centre. They are:
George (brother)
Rose Lenden (sister)
Najette Michael (sister)
Tony Michael (bras-in-law)
Angela Siviero (neice)
Daniel Siviero (neice's husband)
Mandy Reid (Peter's ex-wife)
Steve Reid (Mandy's current hsband)
Roldo Yacoub (cousin)
Joe Nasr (cousin)
David Nassif (cousin)
- The
Commissioner submits that the evidence suggests that no business independent of
the Sleiman interests operates from Jaken Business
Centre. The Commissioner
contends that Peter's identification of Ultimate Computer Solutions as such an
enterprise ought not to be
accepted; ultimately he revealed it/Mr Fares was the
(in house) supplier to the various Sleiman enterprises at Jaken Business Centre.
- The
Commissioner relies on the considerable evidence of Peter dealing with family
members in a business context. Australian Admin
Services Pty Ltd is a
corporation for which Tony and Angela Michael are or were once the directors
which provides administrative
and management services to AVS GC. The
Commissioner contends that this is a business that was created by Peter.
- Further
the Jaken Property Group Pty Ltd is ostensibly an independent business for which
the director is Raymond Saab, and was previously
Peter and Najette Michael. That
business has its registered office at the premises of Jaken Business Centre at
17 Cowper Street,
Granville. It is the trustee for the Sly Fox Family Trust.
- The
Commissioner contends that the evidence suggests that Peter has a dominant
position or at least leading role in the family and
that the family business
dealings is a measure relevant to the assessment of whether Peter wished to
retain de facto control of the
NSW business despite it disposition to Tony. If
it is accepted that Peter would not have disposed of AVS GA outside the family,
i.e.
disposed of it commercially, it suggests that Peter did not wish to lose
his NSW business to someone beyond his influence or control
as it would hinder
his commercial goal through AVS GC to operate nationally.
- The
Commissioner contends that it is significant that in Tony's evidence in regard
to the period from October 2006 to date he does
not assert the occurrence of
even one meeting (with or without an AVS GA manager) of himself with an AVS GA
client; any contact between
himself and the Police or any other regulatory
agencies; ever inspecting client premises to see how his staff were performing;
or
convening even one staff meeting.
- The
Commissioner submits that it is inherently improbable that the principal of a
business would have not engaged in any such activity.
The absence of such
evidence as in 10.7 above suggests Tony was neither relevantly empowered nor
relevantly positioned. It is further
submitted that the inevitable consequence
of that conclusion is that "... directorial managerial [and] ... executive
decision ..."
making authority in AVS GA Business resided other than in Tony.
- In
contrast, the Commissioner has adduced evidence of Peter meeting with an AVS GA
client; having contact with Police or other regulatory
agencies and inspecting
client premises to see how AVS GA staff were performing.
- The
Commissioner contends that as Peter did engage in all of these activities, and
the evidence does not suggest anyone else doing
so, it may be supposed that
after August/October 2006 Peter remained, as he had prior to that date,
relevantly empowered and relevantly
positioned in the business he had founded.
- The
Commissioner submits that Tony was a witness on whom the Tribunal could not
rely. He was ignorant of many matters, and his explanations
of some matters were
implausible to the point of being ludicrous. He submits that nothing in Tony's
demeanour would cause the Tribunal
to hesitate in reaching the conclusions for
which he contended.
Submissions concerning the assessment of Tony's credit
- It
is submitted for the Applicants that the Commissioner has not presented to the
Tribunal a positive case upon which the Tribunal,
acting rationally and fairly,
could find that Peter is, or has at any material time been, a 'close associate'
of the AVSGA business.
- It
is further submitted that on the proper construction of section 5 of the Act,
the Commissioner has probably not even established
a prima facie case to answer
on the question of 'close association'.
- The
Applicants contend that even if it were proved that Tony is not to be believed
on his oath, this would not assist the Tribunal
in resolving a question about
which Tony's account is supported by other evidence, and concerning which there
is simply no evidence
that would reasonably cause the Tribunal to doubt the
truth of Tony's version of relevant events.
Consideration
- The
Applicants have urged caution in regard to the weight given to material on which
the Commissioner relies and particularly in regard
to the material that has not
been made available to the Applicants. Reference was made to the following
observation made by Judicial
Member Molony in Avilion Group Pty Ltd v
Commissioner of Police, NSW Police [2010] NSWADT 129 ("Avilion GD") at
paragraphs [47] - [48] about the material upon which the Commissioner relied in
that matter:
"47 ... much of the material is self-corroborating; with the result that,
when one considers the weight of the underlying evidence,
the whole house of
cards collapses. This, in my view, is not evidence upon which the Tribunal could
be satisfied to the Briginshaw
standard. In that case Dixon CJ said:
"... reasonable satisfaction is not a state of mind that is attained or
established independently of the nature and consequence of
the fact or facts to
be proved. The seriousness of an allegation made, the inherent unlikelihood of
an occurrence of a given description,
or the gravity of the consequences flowing
from a particular finding are considerations which must affect the answer to the
question
whether the issue has been proved to the reasonable satisfaction of the
tribunal. In such matters "reasonable satisfaction" should
not be produced by
inexact proofs, indefinite testimony, or indirect inferences."
48 Among the considerable body of material submitted by the Commissioner
there are, however, a number of pieces of evidence which
are sufficiently
reliable for the Tribunal to rely on when making findings of fact.
- In
these proceedings I have had the assistance of Mr Higgins as Counsel Assisting
the Tribunal. Mr Higgins has had access to the Commissioner's
material and has
made submissions in regard to that material. As a consequence of considerations
at the interlocutory stages much
of the Commissioner's material has been
provided to the Applicants. In the circumstances I do not have the same concerns
as those
that Judicial Member Molony expressed.
Consideration of the Evidence
- When
exercising discretion in relation to a licence it is necessary to keep in mind
the activities that the person will be engaged
in under the licence. In that
regard, the objects and purposes of the Act are relevant i.e. the regulation of
the security industry
to maintain public safety and to ensure that those who are
licensed to operate in the industry are appropriately qualified and persons
of
integrity: O'Neill v Commissioner of Police, NSW Police [2005] NSWADT
130.
- Several
decision of this Tribunal have emphasized the view that the security industry
has a special role in ensuring that public order
is maintained, in safeguarding
community assets and private property and in ensuring that the public and public
venues are safe:
Haining v Commissioner of Police [1999] NSWADT 6.
Is Peter a close associate?
- In
my view, the evidence does not support the finding that Peter holds a relevant
financial interest in the business of AVS GA within
the meaning of section 5 of
the Act.
- If
the Appeal Panel decision in Avilion AP is correct, there is no basis on
which the finding could be made that Peter "is or will be entitled to exercise
any relevant power
(whether in his or her own right or on behalf of any other
person), in the business of the licence applicant or holder, and by virtue
of
that ... power is or will be able (in the opinion of the Commissioner) to
exercise a significant influence over or with respect
to the conduct of that
business". The evidence does not support the finding that Peter is so entitled.
- While
doubt has been raised in regard to the correctness of the Avilion AP
decision, insofar as it relates to the construction to be give to the
expression Peter "is or will be entitled to exercise any relevant
power', this
is not the forum in which to ventilate that issue.
- It
is therefore necessary to determine the question of whether the evidence
supports the finding that Peter holds or will hold any
relevant position in the
business of AVS GA.
- I
have considered the evidence presented on behalf of the parties and their
submissions in regard to the interpretation to be give
to that evidence.
- A
person is a close associate of an applicant under section 5 if that person holds
a position of "director, manager, and other executive
positions and secretary,
however those positions are designated, and such other positions as may be
prescribed by the regulations
for the purposes of this definition." The
Macquarie Dictionary On-Line defines "manager" -
noun 1. someone who manages.
2. a person charged with the management or direction of an institution, a
business or the like
- On
Peter's and Tony's own evidence I am satisfied that Peter played an executive
role in the business of AVS GA up until October 2006.
As such he was a close
associate within the meaning of section 5.
- Their
evidence also supports the finding that Peter also played an executive role in
the business at some time in at least 2007. I
am satisfied that Peter was
performing the role of a manager in the business. He made operational decisions
as needed, liaised with
and advised clients and dealt with the rostering of
personnel.
- However,
Peter and Tony both deny that Peter has performed an executive role in the
business after that date. It is therefore necessary
to consider the evidence
presented on behalf of the Commissioner and determine whether or not Peter has
continued to be a close associate
of AVS GA.
- I
agree with the Applicants that little weight can be given to the Operation
Revocation evidence. In my view the explanation for how
Peter came to be named
as "Employer Contact person" that has been proffered on behalf of the Applicants
is plausible. In the absence
of direct evidence by Constable Graham in regard to
how the Employer Contact details were obtained I do not consider that the
evidence
is of assistance.
- However,
in my view significant weight should be given to the evidence concerning Peter's
dealings with Dean Martin and Ralph Guderjan.
I do not accept the Applicants'
explanation of those dealings. I agree with the submissions made on behalf of
the Commissioner in
regard to the interpretation to be given to that evidence.
- When
the evidence from routine police activity is considered along with that of Mr
Martin and Mr Guderjan, it can be readily inferred
that Peter has continued to
play an executive role in the business of AVS GA.
- In
my view Peter exercised executive authority in the business of AVS GA and he did
so with Tony's approval - either tacit or explicit.
Peter represented the
interests of AVS GA at meetings with the regulator and discussed employing
security guards. Tony never attended
such meetings. Scott Taylor attended in an
apparent subordinate capacity to Peter. Peter exercised managerial or
controlling function
over AVS GA in respect of the conduct of security
activities concerning a number of venues and generally.
- It
is probable that Peter was able to maintain that role because of his position in
the family. I am satisfied that through that arrangement
Peter was effectively
charged with the management of the core business of AVS GA. Regardless of
whether he was officially appointed
to the position, he was a manager and the
holder of an executive position in the business of AVS GA. As such he was a
close associate
within the meaning of section 5.
- I
do not accept the evidence given by Peter and Tony to the effect that Peter no
longer has any role with the AVS GA. In my opinion,
Peter continues to be able
to exercise a significant influence over and with respect to AVS GA's business,
as he has in the past.
- I
am satisfied that Tony is not a person with the ability or experience to manage
the business of AVS GA. He has engaged the management
skills of others to
perform that role. The need for that assistance has allowed Peter's
participation in the executive and managerial
decisions of the business of AVS
GA to continue. Despite Tony's assurances that he is operating the business free
of the influence
of Peter, I do not accept that this is the case.
- The
inclusion of the words "holds or will hold any relevant position" in the section
5 definition of "close associate" suggests that
the relevant time at which that
finding must be reached is at the time of the decision. That is, to be a close
associate Peter must
hold a relevant position at the time the question of
whether he is a close associate is determined or alternatively it must be found
that he will hold such a position.
- I
am satisfied that Peter held a relevant position in the business of AVS GA as at
2010. However, there is no evidence that Peter
continues to carry out that role.
For practical purposes where a person is found to hold a position de facto
despite their denials
of doing so, it would be rare case in which a finding that
the person "holds or will hold" the relevant position at the time of the
decision. Of necessity the finding must be one made by inference.
- In
this matter, given my finding that Peter held a relevant position in the
business of AVS GA as at 2010 and that I did not accept
his denials that that
was the case, any suggestion that Peter no longer holds a relevant position in
the business of AVS GA lacks
force. The inference must be drawn that that he
continues to hold a relevant position and I therefore find as a fact that Peter
holds
a relevant position in the business of AVS GA. In my view he is a close
associate within the meaning of section 5.
The Consequences of Peter being a close associate
- Tony
has not notified the Commissioner that Peter is a close associate in the
business of AVS GA. The failure to do so was a breach
of a condition of the
licence. If Peter had been declared as a close associate at the time the
application for master licence was
made, the effect of section 15(5) would have
been to require the Commissioner to determine whether Peter was a fit and proper
person
to hold a master licence. If he were not a fit and proper person to hold
the licence the Commissioner would have been required to
refuse to grant the
licence.
- Section
26(1A) of the Act provides that the Commissioner must revoke a licence if
satisfied that, were the licensee applying for a
new licence, the Act would
require that the application be refused. If Peter has been and continues to be a
close associate of the
business of AVS GA and if he is not fit and proper to
hold a master licence, the Commissioner is bound to revoke the master licence.
- [Not
for publication]
Is Peter a fit and proper person to hold a master licence?
- In
Avilion GD Molony JM considered a number of authorities that have dealt
with the question of whether a person is fit and proper. He discussed
the matter
at paragraph [119] as follows:
"119 In FD v Commissioner of Police, New South Wales Police [2008]
NSWADT 88 at [46-54] I wrote:
"The discretion vested in a decision maker in determining whether a person is
fit and proper, in any given context, was said by the
Full Court of the Federal
Court in Commissioner for ACT Revenue v Alphaone Pty Ltd (1994) 49 FCR
589 at 389, per Northrop, Miles and French JJ, to "give wide scope for judgement
and allow broad bases for rejection." See also Commissioner of Police v
Toleafoa ([1999] NSWADTAP 9 at [25].
In the present context, additionally to these principles, s.15(6) of the SIA
provides that "for the purpose of determining whether
the Applicant is a fit and
proper person" the Commissioner may have regard to criminal intelligence or
information which, among other
things, "causes the Commissioner not to have
confidence that improper conduct will not occur if the applicant were granted
the licence."
The Act contains no definition of "improper conduct". Section 33 of the
Interpretation Act 1987 ("the IA") says that:
"In the interpretation of a provision of an Act or statutory rule, a
construction that would promote the purpose or object underlying
the Act or
statutory rule (whether or not that purpose or object is expressly stated in the
Act or statutory rule or, in the case
of a statutory rule, in the Act under
which the rule was made) shall be preferred to a construction that would not
promote that purpose
or object."
S.34 of the IA then provides:
"(1) In the interpretation of a provision of an Act or statutory rule, if any
material not forming part of the Act or statutory rule
is capable of assisting
in the ascertainment of the meaning of the provision, consideration may be given
to that material:
(a) to confirm that the meaning of the provision is the ordinary meaning
conveyed by the text of the provision (taking into account
its context in the
Act or statutory rule and the purpose or object underlying the Act or statutory
rule and, in the case of a statutory
rule, the purpose or object underlying the
Act under which the rule was made), or
(b) to determine the meaning of the provision:
(i) if the provision is ambiguous or obscure, or
(ii) if the ordinary meaning conveyed by the text of the provision (taking
into account its context in the Act or statutory rule and
the purpose or object
underlying the Act or statutory rule and, in the case of a statutory rule, the
purpose or object underlying
the Act under which the rule was made) leads to a
result that is manifestly absurd or is unreasonable."
... The Macquarie Dictionary contains the following definition of "improper"
- "not in accordance with propriety of behaviour, manners, etc .: improper
conduct."
On that understanding, the improper conduct to which s.15(6) refers is
conduct in the course of the regulated activity or as a consequence
of the grant
of a licence. In FD's case, were he granted a licence, this would be as an
unarmed guard of persons or property, or
in crowd control. The purpose and
object of the Act appear to be the maintenance of the highest standards of
personal integrity and
conduct in the carrying out of regulated security
activities.
What amounts to prospective improper conduct (having regard to criminal
intelligence) in the context of such a licence, which the
Commissioner is not
confident will not occur, is a difficult question. Some guidance can be found
from the Second Respondent Speech
on the Security Industry Amendment Act
2002 - which, among other things, introduced s.15(6) and (7) to the SIA. Mr
Gaudry, Parliamentary Secretary, in the Legislative Assembly
on 12 November
2002, said:
"The intention of the Security Industry Act is to ensure that high standards
of integrity and conduct are maintained within the security industry. Entry to
the industry is restricted
by the licensing system in order to protect the
public interest by diminishing the likelihood of criminal activity within the
industry.
For this reason, persons convicted of specified offences are barred
from working in security.
It is the view of NSW Police that persons who are known to have extensive
links to organised crime figures, who are members of an
outlaw motor cycle gang
linked to organised crime, or who are suspected of offences relating to drug
trafficking, murder or other
violence offences, should be regarded as "not fit
and proper" to hold a security licence.
However, the determination of whether a person is "fit and proper" is
contextual, as has been recognised in common law. For example,
in Australian
Broadcasting Tribunal v Bond , Justices Toohey and Gaudron found that:
"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
person" 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 those 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."
The Deputy President of the Administrative Decisions Tribunal has also held
that there should be some 'nexus' between the conduct
complained of and the
activities to which the licence relates. This would apply, for example, in the
case of a security guard who
is reported to be associated with criminals with
convictions for the armed robbery of banks. It is therefore considered that
there
is insufficient direction within the Security Industry Act to
ensure that the balance is maintained between the interests of public safety in
ensuring a crime free security industry, and the
interests of individual licence
holders in retaining their licences to work within the industry.
To this end, it is proposed to clarify the definition of "fit and proper
person" in section 15 of the Act such that it can be clearly
seen to include,
but is not limited to, circumstances where:
- criminal intelligence is held on a licence applicant-holder which has a
relationship to the duties performed under the licence applied
for/held;
- which cause the Commissioner of Police to conclude that improper conduct is
likely to occur if the person were to be granted/continue
holding a security
licence; or
- which cause the Commissioner of Police to not have confidence that improper
conduct will not occur if the person were granted/continued
to hold a security
licence.
Clearly, it is in the public interest that persons thought by police to
present a public safety or a criminal risk are not given special
access to
premises, persons or goods under the security licensing system. This should
apply even where the person has yet to be charged
with a specific criminal
offence."
It is apparent that the legislative intention underlying s 15(6)(c) is that
where criminal intelligence or other criminal information
causes the
Commissioner to not be confident that an applicant will not act in accordance
with the high standards of integrity and
behaviour required by the SIA, the
Commissioner may find that person not to be fit and proper to hold a licence.
This is so despite
the fact that, without that criminal intelligence or other
criminal information, the person may otherwise be fit and proper."
- I
agree with that summation. I have considered both the open and confidential
evidence presented by the Commissioner that is the basis
for the assertion that
Peter is not a fit and proper person to be the holder of a licence under the
Act. I agree with the Commissioner's
assessment of that material. I have weighed
the material provided by the Applicants against that of the Commissioner and, in
my view,
the evidence supports the contention that Peter is not a fit and proper
person to be the holder of a licence under the Act.
- I
have found that Tony and/or AVS GA have a close associate, and they have failed
to disclose that close associate. The undisclosed
close associate is not a fit
and proper person to be the holder of a licence under the Act.
- As
a consequence I am satisfied that were AVS GA now applying for a master licence,
the Commissioner would be obliged to refuse that
application under section
15(1)(a). As a result section 26(1A) requires that AVS GA's master licence be
revoked. On this ground I
consider that the Commissioner's decision to revoke
the AVS GA master licence should be affirmed.
- The
Commissioner revoked the licences held by Peter and by AVS GC on the basis that
the holder was no longer a fit and proper person
for the purposes of holding a
licence under the Act. The evidence supports that determination.
- In
my view, the correct and preferable decision is to revoke each of the licences
that are the subject of these applications. Accordingly,
the decisions under
review should be affirmed.
- As
this will have a significant effect on the Applicants and their employees and
clients I think it appropriate that the orders not
have effect immediately. In
my view, it is appropriate that the decision have effect 14 days after this
decision.
Orders
1. In matter No. 093216 the decision under review is affirmed
2. In matter No. 093202 the decision under review is affirmed
3. The orders take effect 14 days after the date of this decision
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