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  4. Berthelsen v Queensland Building and Construction Commission - [2016] QCAT 517

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Berthelsen v Queensland Building and Construction Commission[2016] QCAT 517

Berthelsen v Queensland Building and Construction Commission[2016] QCAT 517

CITATION:

Berthelsen v Queensland Building and Construction Commission [2016] QCAT 517

PARTIES:

Kailen Berthelsen

Idc Developments Pty Ltd

(Applicant)

v

Queensland Building and Construction Commission

(Respondent)

APPLICATION NUMBER:

OCR110-15

MATTER TYPE:

Occupational regulation matters

HEARING DATE:

27 April 2016

HEARD AT:

Bundaberg

DECISION OF:

Member McLean Williams

DELIVERED ON:

12 September 2016

DELIVERED AT:

Brisbane

ORDERS MADE:

Order as follows:

The Applications for Review are dismissed.

QBCC decision 1203350 and QBCC decision 1278608 each made on 13 July 2015 are confirmed.

CATCHWORDS:

Application to Review decisions to cancel QBCC licences - Circumstances of false information on licence renewal applications for both individual applicant and building company applicant regarding prior criminal convictions, and false declarations as to accuracy of information contained in the licence renewal applications - Individual Applicant not a fit and proper person to hold a QBCC licence and a shareholder, director or other influential person for the Corporate Applicant.

Consideration of meaning of expression “fit and proper person” and analysis of honesty and knowledge components of the fit and proper person test - Impact of the making of false declarations on an assessment of fitness and propriety.

Queensland Building and Construction Commission Act 1991 (Qld), ss 31, 32, 32AA, 48

Queensland Civil and Administrative Tribunal Act 2009 (Qld) ss 20, 24

McDonald v Director-General of Social Security (1984) 1 FCR 354

Szbel v Minister for Immigration and Multicultural and Indigenous Affairs [2006] HCA 63

Abebe v Commonwealth (1999) 197 CLR 510

Re Minister for Immigration and Multicultural Affairs; Ex parte Applicant S154/2002 (2003) 77 ALJR 1909

QBCC v Mudri [2015] QCATA 78

Hughes & Vale Pty Ltd v New South Wales (1955) 93 CLR 127

Australian Broadcasting Tribunal v Bond (1990) 94 ALR 11 at 56

Dougdale Holdings Pty Ltd v Builders, New South Wale Licensing Board of New South Wales, Unreported, District Court of New South Wales, 11 December 1973

Pop v QBSA [2012] QCAT 388

Poytress v Director General, New South Wales Fair Trading ([2015] NSW CATOD 100

APPEARANCES and REPRESENTATION (If any):

 

Applicant:

Mr Geoff Ebert, solicitor, Finemore Walters & Story

Respondent:

Mr Malcolm Robinson, solicitor, Robinson Locke Litigation Lawyers

Reasons for Decision

  1. [1]
    On 13 July 2015, by reason number 1203350, the Queensland Building and Construction Commission (‘QBCC’) cancelled the licence of Mr Kailen Derek Berthelsen, on the basis that he was assessed not to be a fit and proper person to hold an industry licence.  This was done pursuant to s.32(1)(g), and 32AA(1)(d) of the Queensland Building and Construction Commission Act (‘QBCC Act’). 
  2. [2]
    Mr Berthelsen was a director and influential person for IDC Developments Pty Ltd (‘IDC’), an entity that he describes in the materials later filed before QCAT as his ‘alter ego for business purposes’.  Accordingly, on 13 July 2015, the industry licence for IDC was also cancelled, pursuant to s.31(2)(a) of the QBCC Act.  Cancellation of the company licence was effectuated by means of QBCC decision number 1278608.
  3. [3]
    On 16 July 2015 Mr Berthelsen commenced an Application to Review before QCAT to review decision 1203350.  By an order of the Tribunal made on 28 July 2015, that Application to Review was enlarged, to include IDC as a further Applicant, and to extend the remit of the Application to Review to include decision 1278608.
  4. [4]
    Applications to Review are heard and determined by way of a fresh hearing on the merits, with QCAT ‘standing in the shoes’ of the original decision maker, to re-determine the matter, on the basis of the evidence available at the time of the Tribunal hearing, so as to produce what the QCAT Act describes as the ‘correct and preferable decision’[1]. This may include receiving new evidence, not available at the time of the making of the original decision.
  5. [5]
    On the hearing of the Application to Review, the Tribunal has those powers specified in s.24(1) of the QCAT Act, and may:
  1. (a)
    Confirm or amend the decision;
  1. (b)
    Set aside the decision and substitute its own decision; or
  1. (c)
    Set aside the decision and return the matter for reconsideration to the (original) decision maker for the decision, with directions.
  1. [6]
    In the context of QCAT’s merits review jurisdiction, it is not apposite to speak of the Applicants bearing an onus of proof.[2] Nonetheless, the Tribunal still needs to be satisfied that the relevant statutory provision is enlivened by the factual material before it.[3]

Factual Background

  1. [7]
    Kailen Berthelsen holds[4] a building industry contractor licence in the following categories:
  • Builder, restricted to kitchen, bathroom and laundry installation (Nominee supervisor);
  • Wall and floor tiling (Nominee supervisor); and
  • Builder, low-rise (Site supervisor).
  1. [8]
    Mr Berthelsen is also the sole director, secretary and shareholder of IDC Developments Pty Ltd, and nominee for IDC.  Presently, IDC holds a contractor license in each of the following classes:
  • Builder, low-rise;
  • Builder restricted to kitchen, bathroom and laundry installation;
  • Wall and floor tiling; and
  • Plastering Drywall.
  1. [9]
    On 12 November 2013, Mr Berthelsen lodged an application with the QBCC in order to renew his contractor licence.  In response to the question posed at paragraph 7(iii) of the Application form: “Have you or any intended business partner…been convicted of any criminal offence (excluding traffic offences) within the last 10 years?”, Mr Berthelsen responded: “No”. 
  2. [10]
    On 30 October 2013 Mr Berthelsen had signed a declaration on the form lodged with the QBCC on 12 November 2013:

“I declare that the statements contained in this application are true and correct.  I also declare that at the date of this declaration I am not aware of anything which gives me reason to know or suspect that I do not satisfy the Financial Requirements for Licensing.  I make this solemn declaration conscientiously believing the same to be true and by virtue of the Oaths Act 1867”.

  1. [11]
    On 27 May 2014, IDC submitted a Licence (renewal) Application, identifying Mr Berthelsen as a director and the nominee for IDC.  That form included, at paragraph 6(iii), the question: Has any director, office holders, major shareholders, nominees, persons of influence or any intended business partner…been convicted of any criminal offence (excluding traffic offences) within the last ten years?”  Again, Mr Berthelson answered that question in the negative.  At section 9 of that form, Mr Berthelsen then signed an identical declaration to that which he had signed on his individual licence renewal application, on 30 October 2013.
  2. [12]
    However, contrary to both declarations, Mr Berthelsen had been previously convicted, by the District Court at Bundaberg on 26 June 2008, on 6 counts of serious assault and one of public nuisance, all referable to a public fracas that had occurred on 28 September 2007.
  3. [13]
    During that court appearance, Mr Berthelsen was sentenced to 9 months imprisonment in respect of each offence (to be served concurrently), yet wholly suspended for an operational period of two years.  Perusal of the District Court sentencing remarks makes clear that a term of imprisonment was ordered because, as at the date of sentencing, Mr Berthelsen was already serving a term of 12 months probation - referable a string of vandalism offences - for which Mr Berthelsen had been previously convicted by the Bundaberg Magistrates Court, in March of 2008.  At the time of the vandalism offences, Mr Berthelsen had been on bail for the offences that were later dealt with by the District Court, on 26 June 2008. 
  4. [14]
    All of these convictions arose within the period of ten years prior to the declarations given by Mr Berthelsen in his QBSA individual and company licence renewal applications, as referred to above.  It bears observing however that no conviction was recorded in the case of the offences dealt with in the Magistrates Court, such that what follows in these Reasons for Decision should be confined to the fact of the (recorded) District Court convictions, only.
  5. [15]
    It should come as no surprise to understand that the QBCC conducts criminal history background checks.  Because the QBCC became aware of Mr Berthelsen’s criminal convictions, the QBCC wrote to each of Mr Berthelsen and IDC on 13 May 2015 by means of a ‘Notice Of Proposed Reasons For Cancellation Or Suspension’ (‘Notice to Show Cause’), giving notice that the QBCC proposed to cancel the industry licence for each of them.  The QBCC advised that it considered that Mr Berthelsen may not be a fit and proper person to hold a Queensland Building and Construction Industry licence, and allowed each of Mr Berthelson and IDC a period of 21 days within which to show cause as to why their licences should not be cancelled, or suspended. 
  6. [16]
    Another matter of concern to the QBCC was also included in the Notice to Show Cause. On 16 January 2015 Mr Berthelsen had been issued with an infringement notice for a breach of s.68(1) the QBCC Act, arising out of a failure to pay an insurance premium on one particular building job.  Mr Berthelsen was convicted of that offence on 18 March 2015 and was also fined $1,100.  A default certificate was lodged with SPER[5] on that date, thus making Mr Berthelsen an enforcement debtor for an offence committed under the QBCC Act.  This is another matter that becomes relevant when determining whether a person is fit and proper, because of s.31(ca) and s.32(2)(d) of the QBCC Act.
  7. [17]
    Between 2 June 2015 and 26 June 2015, Mr Berthelsen, and IDC made various written and oral representations, to the QBCC in response to the Notice to Show Cause.  Unpersuaded by these representations, on 13 July 2015 the QBCC made two separate decisions, cancelling the licences of each of Mr Berthelsen, and IDC.

Relevant Law

  1. [18]
    So far as is presently relevant, section 48 of the QBCC Act provides:

The commission may suspend or cancel a licence if-

  1. (a)
    the licence was obtained on the basis of incorrect information supplied to the commission, whether or not fraud was intended; or
  2. (b)
    the licence was obtained by fraud or other improper means; or
  3. (c)
    the licensee is convicted of an indictable offence or an offence that, if committed in Queensland, would be an indictable offence; or

…/

  1. (f)
    the licensee is convicted of an offence against this Act; or

 …/

  1. (h)
    the licensee contravened a condition to which the licence is subject under section 35 or that is imposed under section 36 on the licensee’s licence; or
  1. (i)
    the licensee owes an amount to the commission and fails to comply with a demand by the commission to discharge the debt; or

(ia) the licensee fails to comply with a written request by the commission under this Act; or

  1. (j)
    the commission becomes aware of the existence of facts that, having regard to section 31(1)(a), or (2)(a), or 32(1)(g), or 32AA(1)(d). or 32AB(1)(d) –
  • would allow the commission to refuse to issue the licence if it were now being applied for by the licensee; or
  • would have allowed the commission to refuse to issue the licence originally.
  1. [19]
    Section 49 of the QBCC Act provides:
    1. (1)
      The commission must, before cancelling or suspending a licence, give the licensee notice of its reasons for the proposed cancellation or suspension and allow the licensee 21 days from service of the notice to make written representations on the matter.
    2. (2)
      The commission must consider any written representations made within the time allowed under subsection(1) before imposing the cancellation or suspension.
  2. [20]
    Section 31 of the QBCC Act provides:
  1. (1)
    A person (not being a company) is entitled to a contractor's licence if the commission is, on application by that person, satisfied that—
  1. (a)
    the applicant is a fit and proper person to hold the licence; and
  1. (b)
    the applicant has the qualifications and experience required by regulation in relation to a licence of the relevant class; and
  1. (c)
    the applicant satisfies the relevant financial requirements stated in the board's policies; and
  1. (d)
    the applicant can lawfully work in Queensland; and
  1. (e)
    the applicant is not an excluded individual for a relevant event or a permanently excluded individual; and
  1. (f)
    the applicant is not a disqualified individual; and
  1. (g)
    the applicant is not a banned individual; and
  1. (h)
    the applicant does not have an unpaid judgment debt for an amount the commission may recover under section 71.
  1. (2)
    A company is entitled to a contractor's licence if the commission is satisfied, on application by that company for a licence, that—
  1. (a)
    the directors, secretary and influential persons for the company are fit and proper persons to exercise control or influence over a company that holds a contractor's licence; and
  1. (b)
    the company's nominee holds a licence specifically identifying, as a class of building work that the nominee may supervise, the same class of building work for which the licence is sought by the company; and
  1. (c)
    the applicant satisfies the relevant financial requirements stated in the board's policies; and
  1. (d)
    the company is not an excluded company; and
  1. (e)
    the company is not a company for which a banned or disqualified individual is a director, secretary, influential person or nominee; and
  1. (f)
    neither the company, nor a director, secretary, influential person or nominee of the company has an unpaid judgment debt for an amount the commission may recover under section 71.
  1. (3)
    In deciding whether a particular person is a fit and proper person to hold a contractor's licence or to exercise control or influence over a company that holds a contractor's licence, the commission may have regard to—
  1. (a)
    commercial and other dealings in which that person has been involved and the standard of honesty and integrity demonstrated in those dealings; and
  1. (b)
    any failure by that person to carry out commercial or statutory obligations and the reasons for the failure; and
  1. (c)
    tier 1 defective work carried out by the person, whether or not the person received a notice under section 67AH, 67AI, 67AL or 67AM stating a term of ban for the work; and

(ca) if the person is an enforcement debtor under an enforcement order for an infringement notice offence for this Act—whether the person has taken steps under the State Penalties Enforcement Act 1999 to discharge the amount stated in the enforcement order; and

  1. (d)
    any other relevant factor.
  1. (4)
    However, the commission may not have regard to the matter mentioned in subsection (3)(ca) if—
  1. (a)
    the person has applied for cancellation of the relevant enforcement order and the application for cancellation has not been finally decided; or
  1. (b)
    28 days have not elapsed since the date of the enforcement order.
  1. [21]
    Section 32 of the QBCC Act provides:
  1. (1)
    An individual is entitled to a nominee supervisor's licence if the commission is, on application by the individual, satisfied that—
  1. (a)
    the applicant has the qualifications and experience required by regulation for a licence of the relevant class; and
  1. (b)
    the applicant can lawfully work in Queensland; and
  1. (c)
    the applicant is not an excluded individual for a relevant event or a permanently excluded individual; and
  1. (d)
    the applicant is not a banned individual; and
  1. (e)
    the applicant is not a disqualified individual; and
  1. (f)
    the applicant does not have an unpaid judgment debt for an amount the commission may recover under section 71; and
  1. (g)
    the applicant is a fit and proper person to hold the licence.
  1. (2)
    In deciding whether an applicant is a fit and proper person to hold the licence, the commission may have regard to—
  1. (a)
    commercial and other dealings in which the applicant has been involved and the standard of honesty and integrity demonstrated in those dealings; and
  1. (b)
    any failure by the applicant to carry out commercial or statutory obligations and the reasons for the failure; and
  1. (c)
    tier 1 defective work carried out by the applicant, whether or not the applicant received a notice under section 67AH, 67AI, 67AL or 67AM stating a term of ban for the work; and
  1. (d)
    if the person is an enforcement debtor under an enforcement order for an infringement notice offence for this Act—whether the person has taken steps under the State Penalties Enforcement Act 1999 to discharge the amount stated in the enforcement order; and
  1. (e)
    any other relevant factor.
  1. (3)
    However, the commission may not have regard to the matter mentioned in subsection (2)(d) if—
  1. (a)
    the person has applied for cancellation of the relevant enforcement order and the application for cancellation has not been finally decided; or
  1. (b)
    28 days have not elapsed since the date of the enforcement order.
  1. [22]
    Section 32AA relevantly provides:
  1. (1)
    An individual is entitled to a site supervisor's licence if the commission is, on application by the individual, satisfied that—
  1. (a)
    the applicant has the qualifications required by regulation for a licence of the relevant class; and
  1. (b)
    the applicant can lawfully work in Queensland; and
  1. (c)
    the applicant is not a banned individual; and
  1. (d)
    the applicant is a fit and proper person to hold the licence.
  1. (2)
    In deciding whether an applicant is a fit and proper person to hold the licence, the commission may have regard only to—
  1. (a)
    tier 1 defective work carried out by the applicant, whether or not the applicant received a notice under section 67AH, 67AI, 67AL or 67AM stating a term of ban for the work; and
  1. (b)
    if the person is an enforcement debtor under an enforcement order for an infringement notice offence for this Act—whether the person has taken steps under the State Penalties Enforcement Act 1999 to discharge the amount stated in the enforcement order.
  1. (3)
    However, the commission may not have regard to the matter mentioned in subsection (2)(b) if—
  1. (a)
    the person has applied for cancellation of the relevant enforcement order and the application for cancellation has not been finally decided; or
  1. (b)
    28 days have not elapsed since the date of the enforcement order.

Fitness and Propriety

  1. [23]
    The expression “fit and proper person” as used in s.31(2)(a), s.32(1)(g) and s.32AA(1)(d) of the QBCC Act is one often used in statutes concerned with occupational regulation.  The concept is a broad one, with that breadth giving the widest possible scope for judgement.
  2. [24]
    The classic statement as to the connotation of that expression is usually taken from Hughes & Vale Pty Ltd v New South Wales (1955) 93 CLR 127 at 156-7 (per Dixon CJ, McTiernan and Webb JJ.), where the High Court said:

‘’Fit’….with respect to an office is said to involve three things, honesty, knowledge and ability: ‘honesty to execute it truly, without malice affection or partiality; knowledge to know what he ought duly to do; and an ability as well in estate as in body, that he may intend and execute his office, when need is diligently, and not for impotency or poverty neglect it’ – Coke.’

  1. [25]
    In Australian Broadcasting Tribunal v Bond,[6] Toohey and Gaudron JJ said:

‘The expression “fit and proper person”, standing alone, carries no precise meaning.  It takes its meaning from its context, from the activities in which the person is or will be engaged and the ends to be served by those activities.  The concept of “fit and proper” cannot be entirely divorced from the conduct of the person who is or will be engaging in those activities.  However, depending on the nature of the activities, the question may be whether improper conduct has occurred, whether it is likely to occur, whether it can be assumed that it will not occur, or whether the general community will have confidence that it will not occur.  The list is not exhaustive but it does indicate that, in certain contexts, character (because it provides indication of likely future conduct) or reputation (because it provides indication of public perception as to likely further conduct) may be sufficient to ground a finding that a person is not fit and proper to undertake the activities in question.’

  1. [26]
    Also in Australian Broadcasting in Bond, Chief Justice Mason said:

‘The question whether a person is fit and proper is one of value judgement.  In that process the seriousness or otherwise of particular conduct is a matter for evaluation by the decision maker.  So too is the weight, if any, to be given to matters favouring a person whose fitness and propriety are under consideration’.[7]

  1. [27]
    In the specific context of the building industry, in Dougdale Holdings Pty Ltd v Builders Licensing Board of New South Wales, Goran J, when speaking of the fit and proper person test in the Builders Licensing Act 1971 (NSW) said:

‘A fit and proper person to hold a licence to build, in my view, is a person who is responsible in his intention and those projected intentions, that is projected into the performance of them; that he is so to speak a stable person upon whom the customer could depend and that he is the sort of person who the Board, in its wisdom, having looked at him in the context of the building trade and industry as a whole, would regard as the sort of person who could be entrusted with projects on behalf of prospective customers who have to pay for his services.’[8]

  1. [28]
    In Pop v QBSA [2012] QCAT 388, Member Byrne observed, at [42], that the power to grant or withhold a licence is protective, and that no element of punishment is involved, and that the primary consideration is the protection of persons - primarily consumers - with whom the licensee might deal.  It was further observed, at [43], that:

‘The QBSA submitted that the ‘concept of fitness and propriety should not be narrowly construed or confined and must extend to any aspects of fitness and propriety that is relevant to the public interest’ and noted that in the matter of Weedon v Builders’ Licencing Board (NSW), Redapple DCJ stated that:

‘In order to show that a person is a fit and proper person to hold a licence, the applicant must establish that in a general sense he is a person of honesty and integrity in his dealings with others, that he is possessed of the characteristics of stability, and of sound judgement which he can and will exercise in the interests of his clients; he must show that he is otherwise of good character’.

  1. [29]
    Although the ascertainment of fitness and propriety invites a broad inquiry, it bears note that the focus of the legislation is not on general character traits, except to the extent that these relate to the consumer protection focus of the statute.  Here, the QBCC Act is one primarily concerned with the protection of the public, by ensuring that building work is not carried out by persons who are unsuitable for participation in the building industry, either because they are not suitably skilled; or because they are persons who are (or who are at least likely to be) dishonest, with those with whom they enter into contracts.[9]
  1. [30]
    In the present matter, questions as to fitness and propriety arise in circumstances in which Mr Berthelsen has a criminal history and has given false declarations to the QBCC in relation to that fact. In Poytress v Director General, New South Wales Fair Trading ([2015] NSW CATOD 100) the following was said in relation to the making of false declarations:

90. I accept that Mr Poytress now has the benefit of legal advice and is now more aware of his obligations.  However I am not satisfied that he has a clear understanding of what is required in the future should he wish to be a licensee.  I am also concerned about the candour with which he has dealt with these issues.  He continued to point to the fact that others had completed the application forms on his behalf.  I do not think he has genuinely acknowledged the fact that it was his responsibility to ensure that the information was correct.  He is clearly an intelligent, well-educated man.  While he has a disability, he gave evidence that he has been able to read reports and some forms.  It seems to me that he simply did not provide the necessary attention to detail in completing the application forms and this suggests that he lacked understanding of the importance of ensuring that the information he was providing was accurate.

91. While I regard these failures as serious, I do not think that Mr Poytress had any ulterior motives in withholding information or that there is any concern in regard to his underlying qualities of character.  Further, there is no suggestion that there is any issue in relation to his ability as a builder.  However, in my view the proper regulation of the home building industry depends on far more than good building skills.  It requires the ability of the licensee to not only comply with the legislative requirements but for them to also understand the importance of those requirements”.

  1. [31]
    On these Applications to Review the only questions relate to whether Mr Berthelsen is a fit and proper person, and whether IDC is entitled to hold a company licence, in the event that it is found that Mr Berthelsen is found not to be a fit and proper person. 
  2. [32]
    One aspect of the inquiry as to whether a person is fit and proper relates to whether the person is possessed of the requisite trade skills and experience to hold an industry licence: these being the ‘ability’ component in the triumvirate of factors identified by the High Court in Hughes & Vale Pty Ltd v New South Wales.[10] 
  3. [33]
    Here, no issue has been taken with either the trade skills or building experience of Mr Berthelsen, and nor has any evidence been received before me that calls into question the quality of the building work undertaken by IDC.  Although ability is one matter that must be considered in relation to the ascertainment of fitness and propriety, I am prepared to proceed on the basis that this aspect of the inquiry will be determined in favour of the Applicants.  Focus must return then, to an evaluation of Mr Berthelsen’s honesty and knowledge.
  4. [34]
    The 13 July 2015 Notices to Show Cause (here summarising), specified the grounds for proposed cancellation as:
  • That Mr Berthelsen had knowingly provided false or misleading information in relation to his prior criminal convictions;
  • That Mr Berthelsen had made a false declaration, about his criminal convictions, for the purposes of obtaining a licence; and
  • On 18 March 2015 Mr Berthelsen was convicted and fined for an offence  under the QBCC Act, in breach of s.68(1), thus making Mr Berthelsen an enforcement debtor for an offence committed pursuant to the QBCC Act. 
  1. [35]
    Various submissions were then made by Mr Berthelsen to the QBCC in response to the Notice to Show Cause.  These were made both verbally, and in writing.[11]  In particular, Mr Berthelsen provided the QBCC with a lengthy written submission.[12]
  2. [36]
    In the submissions made to the QBCC and now again[13] before QCAT, Mr Berthelsen acknowledges that he was convicted of criminal offences by the District Court at Bundaberg.  More however needs to be said about the tenor of that acknowledgement, in what follows, below.
  3. [37]
    In relation to the false and misleading information, and false declaration provided in the QBCC licence applications, Mr Berthelsen explained that these transpired in a context where, immediately following upon his conviction in the District Court he had put the fact of that conviction out of his mind altogether, such that he all but forgot that he had any criminal convictions.  In other contexts, including his making passport and visa applications since the date of his District Court appearance, Mr Berthelsen admits that he has similarly answered the same (or at least a very similar) questions in the negative, without any hesitation. 
  4. [38]
    In his affidavit sworn on 15 October 2015, Mr Berthelsen elaborates on this, and says that he “may have read these standard forms more quickly than I ought to”, and “did genuinely believe that I had no conviction/s recorded against me”.[14]  Mr Berthelsen also said that, since the date of his industry licence cancellation he has contacted the passport office to correct these other false declarations, yet was only advised to be more careful to be truthful, in the future.[15]
  5. [39]
    In relation to the conviction received on 18 March 2015 for an offence against s.68(1) of the QBCC Act, Mr Berthelsen says that this arose out of his failure to pay an insurance premium in March 2014.  He said that this was his first independent job in the building industry and that he was unaware at the time that this was a compulsory requirement.  He failed to pay the fine or make a payment arrangement when first notified of the fine (in January 2015) because at that time he was distracted and pre-occupied by concerns arising out of serious complications in his wife’s pregnancy. Subsequently Mr Berthelsen assumed that the fine would be paid off by means of an already operative automatic payment arrangement with SPER.  However, unknown to Mr Berthelsen was the fact that SPER was still allocating his periodic payments to previously incurred traffic fines, in priority to the later fine incurred for the breach of s.68(1).  Hence is presumed to be the basis for Mr Berthelsen having become an undischarged judgement debtor in reference to an infringement notice issued under the QBCC Act. 
  6. [40]
    In his affidavit sworn on 15 October 2015, Mr Berthelsen deposes that no monies remain owing to SPER, although it is to be observed that no supporting documentation from SPER has been provided to confirm that.
  7. [41]
    The QBCC submits[16] that further relevant matters have arisen since the time of the original Notice to Show Cause, primarily by reason of information more recently submitted - either to the QBCC as part of the show cause process - or in the information now filed as part of the Applications to Review before QCAT. 
  8. [42]
    Because these Applications to Review require a de novo hearing, the QBCC submits, correctly in my view, that QCAT must consider the question of fitness and propriety as at the date of the hearing of the Application for Review,  and on the totality of the evidence; such that QCAT must now examine these newly arising matters, as well:
  • On the original licence application received from IDC on 25 May 2014 a declaration was given that the company had net tangible assets of $18,000 in order to meet the minimum financial requirements of the licence.[17]  Yet, the financial accounts for IDC for the year ending 30 June 2014 inconsistently specify that the company had net tangible assets of only $20.[18]
  • in an interlocutory application heard and determined by QCAT on 28 July 2015 (to obtain a stay of the QBCC decisions that are the subject of these Applications to Review), Mr Berthelsen had informed QCAT that he is subject to a payment arrangement in relation to SPER fines, yet in circumstances where on 9 October 2014, he had provided the QBCC with a Covenantor’s Statement of Financial Position declaring his assets to include cash of $65,799, and his having no current liabilities.
  • The website for IDC Developments Pty Ltd states “Designer Builder – Real Estate Developer”.  No licence number is quoted on the website.  A designer licence is separate from the licence held by Mr Berthelsen and IDC, and it is not clear from the website if the reference to ‘designer’ is a reference to Mr Berthelsen or some other person, such that it is not clear how this public statement is accurate.
  • IDC’s current address is listed in the QBCC Public Register as 10 Breeze Drive Bargara, yet this property was sold by Mr Berthelsen in February 2015 and he no longer resides there.  Section 101 of the QBCC Act requires that a change of circumstances be notified to the QBCC within 14 days of the change.
  • Whether statements made in Mr Berthelsen’s materials regarding the number of persons employed by IDC are accurate.
  • Whether the financial data more recently provided by the Applicants to the QBCC and QCAT under cover of declarations as to accuracy are accurate, or consistent with other information, previously provided, similarly under cover of declarations as to accuracy.

Analysis

  1. [43]
    The fact of Mr Berthelsen having been convicted of criminal offences is incontestable. This is because of his plea of guilt, on 26 June 2008.  Yet, some of the evidence that has been provided by Mr Berthelsen in his submissions to the QBCC in response to the Notice to Show Cause seeks to advance a version of events that is inconsistent with the fact of guilt.  That evidence cannot be accepted.  Nor can the Tribunal accept the apology for having answered the question about prior convictions incorrectly, as is contained in Mr Berthelsen’s original Response to the QBCC Notice to Show Cause.  This is because the apology was made in the context of a denial of any wrongdoing in the version of events given by Mr Berthelsen in the pages that immediately follow after the giving of that apology.[19]  I have considerable difficulty with Mr Berthelsen’s contention that he answered the question about prior criminal convictions in the negative because he has no memory of his guilty plea before the District Court, and that he genuinely believed that he had no prior convictions.  I do not accept that evidence. I do however accept that now (particularly with the benefit of recently obtained legal advice), Mr Berthelsen finally accepts and understands the fact of his having prior criminal convictions.
  2. [44]
    The response given to the Notice to Show Cause further records:

“….since this time nearly 8 years ago, I’ve faced the same if not similar question [sic] on many occasions and answered it in exactly the same way without hesitation”.[20] 

In other written correspondence Mr Berthelsen has sought to justify his false answer on the applications by stating:

“…to me its something that had no foul play involved, I didn’t knowingly intend to mislead anyone”.[21]

Then, in his affidavit, another form of explanation is given, that the error arose because:

“I may have read these standard forms more quickly than I ought to”.

  1. [45]
    This clutch of reasons affords an indication that Mr Berthelsen operates either with complete disregard for the significance of declarations or, at the least, does not understand the purpose for which declarations are given.  Both matters raise doubt, either as to Mr Berthelsen’s honesty or, at the very least about his knowledge and understanding of the obligations imposed on him as an industry licence holder.  A deficiency on either front will be sufficient to act as a negative determinant in an assessment of fitness and propriety. I accept too that significance must here attach to the fact that Mr Berthelsen only sought to correct these inaccurate declarations once the inaccuracy of his prior declarations had been detected by the QBCC.
  2. [46]
    In relation to the SPER fine payment arrangement, the QBCC submits that the circumstance of applying for a payment arrangement on the basis of an inability to pay the fine must be considered against the further circumstance that Mr Berthelsen has, in other contexts, declared to the QBCC having $65,799 in current cash assets, with no current liabilities, as at 9 October 2014.  The inference that I am invited to draw is that Mr Berthelsen could easily have drawn down on his cash reserves in order to pay the fine; and that in the circumstances of having a significant cash reserve any declaration of impecuniosity, if put up as the basis for obtaining a payment arrangement from SPER, must have been another instance of ‘empty words’ from Mr Berthelsen.  I am not however prepared to draw that inference.  For one thing, there is no evidence before me that Mr Berthelsen entered into a payment arrangement because he could not afford to pay the fine. There are a host of conceivable reasons, beyond impecuniosity, as to why a payment arrangement might have been considered preferable.  Nor is there proper evidence before me that Mr Berthelsen made a false declaration to SPER in order to obtain a payment arrangement.
  3. [47]
    Next, the QBCC submits that the ‘Designer Builder – Real Estate Developer’ reference on the IDC website is misleading, thus affording further evidence of unfitness and impropriety by Mr Berthelsen, because he is not licensed by the QBCC as a designer.  I accept however the sufficiency of Mr Berthelsen’s explanation for the website representation[22] that his intent by that statement was to do no more than convey to consumers that IDC is a builder of “designer” homes, rather than standard homes.
  4. [48]
    Then, the QBCC submits that the failure by Mr Berthelsen and IDC to notify the QBCC of IDC’s current registered address within 14 days after the sale of 10 Breeze Drive Bagarra, in breach of s.101 of the QBCC Act, affords a further matter for consideration in an assessment of fitness and propriety.  I accept that submission.  The Applicants have not satisfactorily explained that omission, and I infer from it that Mr Berthelsen has insufficient understanding or awareness of the important obligations imposed on industry licence holders, which include the need to update address details.  This then becomes another factor that goes to the ‘knowledge’ component in the fitness and propriety triumvirate identified by the High Court in Hughes & Vale Pty Ltd v New South Wales.[23] 
  5. [49]
    The QBCC also observes that Mr Berthelsen has submitted to QCAT – by means of assertions contained in his statement of evidence filed in support of the application for a stay – that IDC employs a number of employees (including apprentices), yet the QBCC says that this assertion is demonstrably inaccurate, as it is inconsistent with financial records submitted by IDC to the QBCC which reveal that IDC has incurred no employment expenses.  It is only after the inaccuracy of the assertion is identified that the error is corrected, in this instance by means of an addendum affidavit, filed in the Tribunal on 25 February 2016.
  6. [50]
    Finally, the QBCC submits[24] that, on the basis of financial information supplied more recently by IDC, there appears to have been an incorrect declaration about IDC’s financial position when originally applying for an industry licence; as well as a clear change in its financial circumstances over time, not notified to the QBCC as required, until after that change in circumstances had been identified by the QBCC in the course of these proceedings.  Mr Berthelsen and IDC have attempted to respond to those concerns by means of providing further financial accounts, again declared to be correct by Mr Berthelsen, yet again demonstrably inconsistent with other facts, similarly declared on previous occasions by Mr Berthelsen to be accurate. I accept this submission by the Respondent.
  7. [51]
    The fact that Mr Berthelsen has prior criminal convictions, incurred when he was still a very young man is no longer even relevant.  In and of themselves, those convictions (wholly unrelated as they are to Mr Berthelsen’s participation in the building industry) were not, had these been correctly declared, any actual impediment to Mr Berthelsen obtaining a building industry licence.  What however remains relevant are the false declarations subsequently given about these criminal convictions. 
  8. [52]
    I am left with an overall impression that Mr Berthelsen has insufficient regard for the significance of declarations, and is much too quick to declare the accuracy of information that can then just as easily be shown to be inaccurate.  A situation thus arises whereby the giving of Mr Berthelsen’s word becomes a matter of doubt, such that his assurances are unable to be accepted, at least not without suspicion, and then the need for constant checking.  That can hardly be a desirable state of affairs for any person who may be considering contracting with Mr Berthelsen, particularly when the purpose of the licensing regime is in order that consumers can repose confidence in the trustworthiness of licence holders.  
  9. [53]
    It seems further clear that Mr Berthelsen does not, at this stage at least, sufficiently understand all of the statutory obligations that are imposed on licence holders.  More effort will be needed by him in order to show that he has educated himself as to these obligations, before it can be concluded that he has the knowledge required to be a fit and proper person. 
  10. [54]
    In the circumstances of these findings it is appropriate to cancel the licence of each of Mr Berthelsen, and IDC, pursuant to s.48(j) or 48(a) of the QBCC Act
  11. [55]
    The Applications to Review QBCC decisions 1278608 and 1278608, each made on 13 July 2015, are dismissed.  The decisions under review are now confirmed by the Tribunal, pursuant to s.24(1)(a)  of the QCAT Act.

Footnotes

[1] QCAT Act 2009, s 20.

[2] McDonald v Director-General of Social Security (1984) 1 FCR 354; Szbel v Minister for Immigration and Multicultural and Indigenous Affairs [2006] HCA 63 at [40]; Abebe v Commonwealth (1999) 197 CLR 510 at 576; Re Minister for Immigration and Multicultural Affairs; Ex parte Applicant S154/2002 (2003) 77 ALJR 1909 at 1918.

[3] QBCC v Mudri [2015] QCATA 78 at [12].

[4] The decisions now under review to cancel the licences of Mr Berthelsen and IDC are currently subject to a stay, ordered by QCAT on 28 July 2015.

[5] State Penalties Enforcement Registry.

[6] (1990) 94 ALR 11 at 56.

[7] Ibid, at 63.

[8] Unreported, District Court of New South Wales, 11 December 1973.

[9] O'Toole v QBSA [1996] QBT 257; Petracaro v Commissioner of Consumer Affairs (1994) 62 SASR 387.

[10] Supra, [24].

[11]   Affidavit filed 16 October 2015, at paragraph 4(b).

[12] Respondent’s bundle of documents filed 25 September 2015, at p. 88.

[13] Affidavit filed 16 October 2015, at paragraph 4(b)

[14] Paragraph 11.

[15] Paragraph 12.

[16] Respondent’s opening address, paragraph 24.

[17] Respondents bundle of documents, p. 56 & 58.

[18] Respondents supplementary bundle of documents, at p. 150.

[19] Respondent’s initial Bundle of Documents, at pp. 92-94.

[20] Bundle of Documents, p. 88.

[21] Bundle of documents, p. 105

[22] Affidavit sworn 15 October 2015, paragraph 18.

[23] Supra, [24].

[24] Respondent’s closing submissions, paragraphs 44 – 57.

Close

Editorial Notes

  • Published Case Name:

    Kailen Berthelsen & Anor v Queensland Building and Construction Commission

  • Shortened Case Name:

    Berthelsen v Queensland Building and Construction Commission

  • MNC:

    [2016] QCAT 517

  • Court:

    QCAT

  • Judge(s):

    Member McLean Williams

  • Date:

    12 Sep 2016

Litigation History

EventCitation or FileDateNotes
Primary Judgment[2016] QCAT 51712 Sep 2016Applications for review of two decisions of the Queensland Building & Construction Commission made 13 July 2015 (decisions to cancel Mr Berthelsen's licence and that of his company) dismissed; decisions confirmed: Member McLean Williams.
Primary Judgment[2016] QCATA 17111 Nov 2016Parties granted leave to be legally represented; decision dated 12 September 2016 stayed until further order: Senior Member Stilgoe OAM.
Primary Judgment[2017] QCATA 8204 Jul 2017Appeal allowed; decision dated 12 September 2016 set aside and proceeding returned to the Tribunal for reconsideration: Senior Member Stilgoe OAM and A/Senior Member Howard.
Primary Judgment[2018] QCAT 40026 Nov 2018Upon remit (see [2017] QCATA 182) two decisions of the Queensland Building & Construction Commission made 13 July 2015 (decisions to cancel Mr Berthelsen's licence and that of his company) set aside: Member Howe.
Notice of Appeal FiledFile Number: Appeal 7881/1702 Aug 2017-
Appeal Determined (QCA)Appeal 7881/17 (No Citation)16 Apr 2018Application dismissed: Sofronoff P and Gotterson and Morrison JJA.

Appeal Status

Appeal Determined (QCA)

Cases Cited

Case NameFull CitationFrequency
Abebe v Commonwealth (1999) 197 CLR 510
2 citations
Jump To
Cite 1 - (1999) 197 CLR 510
Cite 2 - (1999) 197 CLR 510
Australian Broadcasting Tribunal v Bond (1990) 94 ALR 11
3 citations
Jump To
Cite 1 - (1990) 94 ALR 11
Cite 2 - (1990) 94 ALR 11
Cite 3 - (1990) 94 ALR 11
Hughes & Vale Pty. Ltd. v New South Wales (No. 2) (1955) 93 CLR 127
2 citations
Jump To
Cite 1 - (1955) 93 CLR 127
Cite 2 - (1955) 93 CLR 127
McDonald v Director-General of Social Security (1984) 1 FCR 354
2 citations
Jump To
Cite 1 - (1984) 1 FCR 354
Cite 2 - (1984) 1 FCR 354
O'Toole v QBSA [1996] QBT 257
1 citation
Jump To
Cite 1 - [1996] QBT 257
Petracaro v Commissioner of Consumer Affairs (1994) 62 SASR 387
1 citation
Jump To
Cite 1 - (1994) 62 SASR 387
Pop v Queensland Building Services Authority [2012] QCAT 388
2 citations
Jump To
Cite 1 - [2012] QCAT 388
Cite 2 - [2012] QCAT 388
Poytress v Director General [2015] NSW CATOD 100
2 citations
Jump To
Cite 1 - [2015] NSW CATOD 100
Cite 2 - [2015] NSW CATOD 100
Queensland Building and Construction Commission v Mudri [2015] QCATA 78
2 citations
Jump To
Cite 1 - [2015] QCATA 78
Cite 2 - [2015] QCATA 78
Re Ruddock; Ex parte Applicant S154/2002 (2003) 77 ALJR 1909
2 citations
Jump To
Cite 1 - (2003) 77 ALJR 1909
Cite 2 - (2003) 77 ALJR 1909
SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs [2006] HCA 63
2 citations
Jump To
Cite 1 - [2006] HCA 63
Cite 2 - [2006] HCA 63

Cases Citing

Case NameFull CitationFrequency
Berthelsen v Queensland Building and Construction Commission [2017] QCATA 8214 citations
JM Kelly Builders Pty Ltd v Queensland Building and Construction Commission [2018] QCAT 3331 citation
1

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