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Buchanan v Queensland Building and Construction Commission[2019] QCAT 354

Buchanan v Queensland Building and Construction Commission[2019] QCAT 354

QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL

 

CITATION:

Buchanan v Queensland Building and Construction Commission [2019] QCAT 354

PARTIES:

CASEY BUCHANAN

(applicant)

 

v

 

QUEENSLAND BUILDING AND CONSTRUCTION COMMISSION

(respondent)

APPLICATION NO:

OCR121-17; OCR215-17

MATTER TYPE:

Occupational regulation matters

DELIVERED ON:

20 November 2019

HEARING DATE:

18 March 2019; 22 October 2019 

HEARD AT:

Brisbane

DECISION OF:

Member Dr Collier

ORDERS:

 

 

 

In OCR121-17:

  1. The decision of the Respondent made on 16 May 2017 in respect of QUBE North is confirmed.
  2. The Respondent is to set a date which it deems appropriate from which the licences of the Applicant are to be cancelled for the period prescribed by law.

In OCR215-17:

  1. The decision of the Respondent made on 1 September 2017 in respect of QUBE Projects is set aside and of no effect.

CATCHWORDS:

STATUTES – ACTS OF PARLIAMENT – INTERPRETATION – interpretation of the Queensland Building and Construction Commission Act 1991 (Qld) – period of liability under s 56AC(2)(c)(ii) of the Queensland Building and Construction Commission Act 1991 (Qld) – excluded individual – permanently excluded individual – construction company – liquidation – relevant event – when two events are consequences flowing from what is, in substance, the one set of circumstances

Acts Interpretation Act 1954 (Qld), s 20(2), s 20(3), s 20C

Building Industry Fairness (Security of Payment) Act 2017, s 271

Professional Engineers and other Legislation Amendment Bill 2014 (Qld)

Queensland Building and Construction Commission Act 1991 (Qld), s 4AA(1), s 56AC, s 56AC(2)(c)(ii), s 56AC(3), s 56AC(4), s 56AC(5), s 56AF, s 56AF(3), s 58, s 59(a)

Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 24, s 24(2)(b)

D’Arro v Queensland Building and Construction Commission [2017] QCA 90

Dixie v Royal Columbian Hospital (1941) 2 DLR 138

Jensen v Queensland Building and Construction Commission [2017] QCAT 232 

Maxwell v Murphy [1957] HCA 7; (1957) 96 CLR 261

Ogden Industries Pty Ltd v Lucas (1967) 116 CLR 537

Paddon v Queensland Building and Construction Commission [2018] QCAT 100

Vickers v Queensland Building and Construction Commission & Ors [2019] QCA 66

APPEARANCES &

REPRESENTATION:

 

Applicant:

Self-represented

Respondent:

M Robinson, solicitor

REASONS FOR DECISION

  1. [1]
    Casey Buchanan (‘Buchanan’) has many years of experience as a tradesman and builder and holds four Queensland Building and Construction Commission (‘QBCC’) licences:[1]
    1. Builder – low rise;
    2. Builder – open;
    3. Carpentry; and
    4. Plastering drywall.
  2. [2]
    The records disclose that Buchanan had no entries in any category on his QBCC disciplinary record.
  3. [3]
    At various times Buchanan was an officeholder in two construction companies:
    1. QUBE North Pty Limited ACN (‘QUBE North’);[2] and
    2. QUBE Projects Pty Limited ACN (‘QUBE Projects’).[3]
  4. [4]
    Each of these companies had a liquidator appointed:
    1. QUBE North on 3 April 2017; and
    2. QUBE Projects on 24 May 2017.
  5. [5]
    Records of the Australian Securities and Investments Commission (‘ASIC’) and Victorian Building Authority suggest that Buchanan may have had a beneficial interest in the equity of QUBE North.[4] There is no evidence to suggest that Buchanan held equity in QUBE Projects.
  6. [6]
    As a result of his association with QUBE North, the QBCC issued Buchanan with a notice dated 16 May 2017 that he was an excluded individual. The relevant portions of this notice say:

A person becomes an excluded individual if the individual … is a director, secretary or influential person for a construction company at any time up to a year before the company has a provisional liquidator, liquidator, administrator or controller appointed.

For three years from the date of the relevant event [the appointment of the liquidator], an excluded individual is not entitled to:

  • Hold a QBCC contractor licence or nominee supervisor licence;
  • Be a director, secretary or influential person for a company holding a contractor’s licence; or
  • Be a partner of a licensed contractor.

TAKE NOTICE pursuant to Section 56AC of the QBCC Act, QBCC considers you to be an excluded individual for the following reason:

You were a director, secretary or influential person for the Company at the time of, or within one year of, the Event.

  1. [7]
    As a result of his association with QUBE Projects the QBCC issued Buchanan with a notice dated 1 September 2017 that he was a permanently excluded individual. The relevant portions of this notice say:

On 16 May 2017 QBCC wrote to you notifying you that QBCC considered you to be an excluded individual for a relevant event. QBCC has become aware of a second relevant event for which you are an excluded person.

A person becomes an excluded individual if the individual … is a director, secretary or influential person for a construction company at any time up to a year before the company has a provisional liquidator, liquidator, administrator or controller appointed.

For three years from the date of the relevant event [the appointment of the liquidator], an excluded individual is not entitled to:

  • Hold a QBCC contractor licence or nominee supervisor licence;
  • Be a director, secretary or influential person for a company holding a contractor’s licence; or
  • Be a partner of a licensed contractor.

Pursuant to Section 58 of the Queensland Building and Construction Act 1991, if a person becomes an excluded individual for a relevant event, and then has a second relevant event, that person becomes an excluded individual for life.

QBCC has become aware of the following relevant event (the Second Event) … On or about 24 May 2017, Daniel Peter Juratowitch and Glenn John Spooner of Cor Cordis were appointed liquidators of Qube Projects Pty Ltd (the Company).

TAKE NOTICE pursuant to Section 56AC of the QBCC Act, QBCC considers you to be an excluded individual for the following reason:

You were a director, secretary or influential person for the Company at the time of, or within one year of, the Event.

If you are categorised as an excluded individual for the Second Event, you will be considered a permanently excluded individual. Becoming a permanently excluded individual has the following effect for the rest of your life:

  • you are not entitled to a contractor or nominee supervisor licence.
  • Any company of which you are a director, secretary, influential person or nominee will be an excluded company. An excluded company is not entitled to a contractor licence. If an excluded company already has a contractor licence QBCC must cancel that licence.
  • You are not able to be a partner of a licensed contractor.
  1. [8]
    There was no evidence that Buchanan made submissions to the QBCC concerning either notice, and the QBCC notice that Buchanan was a permanently excluded individual was due to come into effect.
  2. [9]
    In respect of the notice by the QBCC dated 16 May 2017 concerning QUBE North, on 15 June 2017 Buchanan filed an Application to review a decision with the Tribunal seeking a review of the decision in this notice.[5]
  3. [10]
    In respect of the notice by the QBCC dated 1 September 2017 concerning QUBE Projects, on 26 September 2017 Buchanan filed an Application to review a decision with the Tribunal seeking a review of the decision in this notice.[6]
  4. [11]
    The Tribunal gave directions that the two matters would remain separate but travel together.
  5. [12]
    The Tribunal also issued a stay on the operation of each notice until both matters had been heard and determined.
  6. [13]
    During his evidence Buchanan agreed that his licences should be subject to a period of suspension on the basis of his having been an officeholder of the companies, but he raised the following points as to why he should not be a permanently excluded individual:
    1. The ASIC records showing him as a director and secretary of the two companies are inaccurate in important respects and have been the subject of unauthorised amendment without his knowledge. As a result, he was not an officeholder of QUBE Projects within the period prescribed in the QBCC Act before the appointment of the liquidator; and
    2. The appointment of a liquidator to each of QUBE North and QUBE Projects flows from what is, in substance, the one set of circumstances.
  7. [14]
    Each of these points is examined in detail below.

The relevant law

  1. [15]
    A person becomes an excluded individual if the conditions described in s 56AC of the QBCC Act are met, in this case (expressing the law as it was before 10 November 2017 and described in both QBCC notices to Buchanan):

If a construction company, for the benefit of a creditor has a liquidator, appointed and 3 years have not elapsed since the relevant company event happened; and the individual was, within the period of 1 year immediately before the relevant company event happened, a director or secretary of, or an influential person for, the construction company the individual is an excluded individual for the relevant company event.

  1. [16]
    There is no decision required by the QBCC about whether or not a person is an excluded individual, a person becomes an excluded individual by operation of the Act. In this case, if Buchanan met the conditions prescribed in s 56AC of the QBCC Act, he became an excluded individual, without more having to occur.
  2. [17]
    In the case of QUBE North, the QBCC issued a notice to Buchanan dated 16 May 2017 under the provisions of s 56AF of the QBCC Act that the QBCC considered Buchanan to be an excluded individual for the relevant company event. Buchanan had 28 days to make a submission to the QBCC but did not make a submission. In this case, s 56AF(3) requires that the commission must cancel the individual’s licence, by written notice given to the individual. The same process was followed by the QBCC in respect of QUBE Projects, except that the notice to Buchanan was dated 1 September 2017, and Buchanan made no submission to the QBCC regarding this notice.
  3. [18]
    The QBCC has not cancelled Buchanan’s licences because Buchanan commenced proceedings in this Tribunal.
  4. [19]
    Prior to 10 November 2017 the relevant portion of s 56AC of the QBBC Act said:
  1. This section also applies to an individual if—
  1. a construction company, for the benefit of a creditor—
  1. has a provisional liquidator, liquidator, administrator or controller appointed; or
  2. is wound up, or is ordered to be wound up; and
  1. 3 years have not elapsed since the event mentioned in paragraph (a)(i) or (ii) (relevant company event) happened; and
  2. the individual—
  1. was, when the relevant company event happened, a director or secretary of, or an influential person for, the construction company; or
  2. was, within the period of 1 year immediately before the relevant company event happened, a director or secretary of, or an influential person for, the construction company.

  1. If this section applies to an individual because of subsection (2), the individual is an excluded individual for the relevant company event.
  2. An excluded individual for a relevant event does not also become an excluded individual for another relevant event if the commission is satisfied that both events are consequences flowing from what is, in substance, the one set of circumstances.
  1. [20]
    From 10 November 2017 s 56AC(2)(c)(ii) was amended to read:[7]
  1. (ii)
    was, within the period of 2 years immediately before the relevant company event happened, a director or secretary of, or an influential person for, the construction company.
  1. [21]
    This amendment imposes liability on a person looking back at relevant company events that occurred within two years of that person being a director or secretary of, or an influential person for, an affected company, rather than the one year previously.
  2. [22]
    The relevant events in this matter, being the appointment of liquidators to two companies, occurred, respectively, on 3 April 2017 and 24 May 2017, both dates being before the increased period of liability began on 10 November 2017.
  3. [23]
    In its submissions to the Tribunal the QBCC argued that the liability period relevant to Buchanan is two years.
  4. [24]
    Section 58 of the QBCC Act makes provision for an individual to be a permanently excluded individual in the following circumstances:
  1. (1)
    A permanently excluded individual is an individual—
  1. (a)
    who has twice been an excluded individual for a relevant event; and
  1. (b)
    who for each relevant event has been given written notice by the commission stating—
  1. (i)
    particulars identifying the relevant event; and
  1. (ii)
    why the commission considers the individual is an excluded individual for the relevant event.
  1. (2)
    Notice under subsection (1)(b)—
  1. (a)
    must be given while the individual is an excluded individual for the relevant event to which the notice relates; and
  1. (b)
    if the notice is the second or a subsequent notice the individual has been given about being an excluded individual for a relevant event—
  1. (i)
    must state the effect of the individual becoming a permanently excluded individual; and
  1. (ii)
    may be given at any time after an earlier notice was given.
  1. (3)
    An excluded individual who is a licensee is taken to have been given notice under subsection (1)(b) if—
  1. (a)
    the individual has been given notice under section 56AF(2); and
  1. (b)
    for a second or subsequent notice, the notice also includes the information required under subsection (2)(b)(i).
  1. (4)
    A second or subsequent notice may be given for a relevant event whether the event happened before or after another event for which the commission has already given notice under subsection (1)(b).
  1. (5)
    However, subsection (1) applies only if an individual became an excluded individual for at least one of the relevant events after the commencement of this section, irrespective of when the circumstances resulting in the relevant event arose.
  1. (6)
    If a second or subsequent notice does not include the information required under subsection (2)(b)(i) another notice containing the information may be given.
  1. (5)
    It is declared that in deciding whether 2 relevant events as mentioned in subsection (1) have happened, a relevant event must be counted—
  1. (a)
    whether the relevant event happened before or after the other relevant event; and
  1. (b)
    whether or not the notices under subsection (1)(b) for the relevant events were given in the order the relevant events happened; and
  1. (c)
    regardless of the length of time between the giving of the notices under subsection (1)(b) for the relevant events; and
  1. (d)
    whether the relevant event happened before or after the commencement of this section, subject to subsection (5).

Example for subsection (2)(a)—

The commission gives a licensee a notice under this section for a relevant event for which the licensee is currently an excluded individual. The commission later discovers that the licensee was, before the grant of the licensee’s licence, an excluded individual for a previous relevant event. However, the licensee is not currently an excluded individual for this relevant event because 5 years have elapsed since the event happened. It may not give the licensee a notice for this event.

Example for subsection (7)(a), (b) and (d)—

The commission gives a licensee a notice under this section for a relevant event that happened after the commencement of this section. It later discovers that the licensee is an excluded individual for another relevant event that happened before the grant of the licensee’s licence and before the commencement of this section. It may give the licensee a notice for this relevant event. Also, it is the later notice, about the earlier relevant event, that must state the effect of the individual becoming a permanently excluded individual.

Examples for subsection (7)(c)—

1 The commission becomes aware that a person who is an applicant for a contractor’s licence is currently an excluded individual for 2 relevant events one of which happened after the commencement of this section. The commission may give the person a notice for one of the relevant events and immediately give a notice for the other relevant event. Also, it is the later notice that must state the effect of the individual becoming a permanently excluded individual.

2 A licensee becomes an excluded individual for a relevant event. The individual’s licence is cancelled under section 56AF and the individual is given notice complying with this section for the relevant event. More than 5 years later the licensee applies for and is granted a contractor’s licence. Ten years after this, the licensee becomes an excluded individual for another relevant event. The commission gives a notice complying with this section for the latest relevant event. This notice includes the information required for a second or subsequent notice under subsection (2)(b)(i) and the individual becomes a permanently excluded individual.

  1. [25]
    The consequence of being a permanently excluded individual is harsh: the QBCC must not grant a person a licence to a person who is a permanently excluded individual.[8] A QBCC licence is required to conduct most trades in Queensland, thus a permanently excluded individual is, effectively, excluded from ever again working in Queensland in his or her trade, or in the capacity of a builder, or as an officer or person of influence in a construction company.

QBCC’s position

  1. [26]
    The QBCC said that the fact that the companies were construction companies in different jurisdictions (one in Queensland, and one in Victoria and Tasmania) does not affect the operation of the QBCC Act in this regard: Vickers v Queensland Building and Construction Commission & Ors.[9] This is now settled law and the QBCC interpretation in this respect is correct.
  2. [27]
    The QBCC said that the ASIC record should be relied upon by the Tribunal, but acknowledged that the face of the record is capable of rebuttal.
  3. [28]
    In regard to the appointment of liquidators to QUBE North on 3 April 2017 the QBCC view was that, because Buchanan had been a director and secretary of that company within two years of the appointment of the liquidators, he is, by operation of s 56AC of the QBCC Act, an excluded individual.
  4. [29]
    In regard to the appointment of liquidators to QUBE Projects on 24 May 2017, the QBCC said that:
    1. because Buchanan had been a director and secretary of that company within two years of the appointment of liquidators; and
    2. because Buchanan had previously been notified that he was an excluded individual because of his association with QUBE North; and
    3. because the QBCC had given proper notice to Buchanan concerning his status as an excluded individual as a result of his association with QUBE Projects;
    4. that Buchanan became a permanently excluded individual under the provisions of s 58 of the QBCC Act.
  5. [30]
    The QBCC said that the proper period of association with a construction company before a relevant event for the purposes of s 56AC(2)(c)(ii) of the QBCC Act is two years, that is, the provision that came into force from 10 November 2017, not the one year that prevailed before that date. In support of this proposition, the QBCC relied upon the nature of the decision that has to be made – that is, the Tribunal is making a decision de novo, and the view of the Court of Appeal in D’Arro v Queensland Building and Construction Commission.[10] Which version of s 56AC(2)(c)(ii) of the QBCC Act is to be applied by this Tribunal is an important matter that is discussed in detail below.
  6. [31]
    The QBCC said that the two events were different events and did not flow from what was, in substance, the one set of circumstances. Because they were different events they were sufficient for the QBCC to decide that Buchanan was a permanently excluded individual under the terms of s 58 of the QBCC Act, and that the QBCC has complied with the provisions of that section.

Which version of s 56AC(2)(c)(ii) applies?

  1. [32]
    This section of the decision considers which version of s 56AC(2)(c)(ii) applies: the version before 10 November 2017; or the version from and after that date.
  2. [33]
    Section 24 of the Queensland Civil and Administrative Act 2009 (Qld) provides as follows:
  1. (1)
    In a proceeding for a review of a reviewable decision, the tribunal may—
  1. (a)
    confirm or amend the decision; or
  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 decision-maker for the decision, with the directions the tribunal considers appropriate.
  1. (2)
    The tribunal’s decision under subsection (1)(a) or (b) for a reviewable decision—
  1. (a)
    is taken to be a decision of the decision-maker for the reviewable decision except for the tribunal’s review jurisdiction or an appeal under part 8; and
  1. (b)
    subject to any contrary order of the tribunal, has effect from when the reviewable decision takes or took effect.
  1. [34]
    Section 24(2)(b) makes this Tribunal’s decision effective from when the reviewable decision took effect, subject to any contrary order. There are two reviewable decisions in this matter dated, respectively, 16 May 2017 and 1 September 2017. Therefore, absent an order of the Tribunal to the contrary, any decision of the Tribunal has effect from the date of the original, reviewable, decision.
  2. [35]
    This provision speaks to the conclusion that the law to be applied to the Tribunal’s decision is the law that applied as at the date of the original decision.
  3. [36]
    If the Tribunal adopts the QBCC assertion that the law to be applied should be the law as it is found on the date when the Tribunal makes its de novo decision then the Tribunal would, if it confirms the original decision of the QBCC, be doing the following:
    1. Confirming a decision of the QBCC that was made under the previous law;
    2. Based on a new law, not the law applying at the time of the original decision; and
    3. Ordering that the decision apply from the date of the original decision (subject to the Tribunal making a contrary order).
  4. [37]
    There is a logical problem with this sequence: everything is referable to past events, except the law that is to be applied. This suggests that the law to be considered by the Tribunal in making its review decision should be that which applied at the time of the original decision.
  5. [38]
    Turning to the Acts Interpretation Act 1954 (Qld), there are two provisions that bear upon the instant matters. First, s 20(2) of the Act provides as follows:

The repeal or amendment of an Act does not—

  1. (a)
    revive anything not in force or existing at the time the repeal or amendment takes effect; or
  1. (b)
    affect the previous operation of the Act or anything suffered, done or begun under the Act; or
  1. (c)
    affect a right, privilege or liability acquired, accrued or incurred under the Act; or
  1. (d)
    affect a penalty incurred in relation to an offence arising under the Act; or
  1. (e)
    affect an investigation, proceeding or remedy in relation to a right, privilege, liability or penalty mentioned in paragraph (c) or (d).
  1. [39]
    Section 20(3) of the Acts Interpretation Act provides:

The investigation, proceeding or remedy may be started, continued or completed, and the right, privilege or liability may be enforced and the penalty imposed, as if the repeal or amendment had not happened.

  1. [40]
    The effect of these provisions suggests that the amendments to the QBCC Act effective from 10 November 2017 do not alter the effect of the legislation in force at the time of Buchanan’s impugned conduct, which should be the law applied in the review decision. In particular, these provisions convey the intent of the legislature that an amendment of an Act should not permit the imposition of any additional burden upon a person that was not imposed by the earlier Act.
  2. [41]
    Second, this interpretation is supported by s 20C of the Acts Interpretation Act which relevantly provides:
  1. (2)
    If an Act makes an act or omission an offence, the act or omission is only an offence if committed after the Act commences.
  1. (3)
    If an Act increases the maximum or minimum penalty, or the penalty, for an offence, the increase applies only to an offence committed after the Act commences.
  1. [42]
    The Acts Interpretation Act does not define ‘offence’, ‘privilege’ or ‘right’ although it defines ‘liability’ and ‘penalty’.[11] Offences and penalties in this context can apply equally to civil offences and penalties, such as arise in the QBCC Act, as they could to criminal offences and penalties. Therefore an offence, or an increase in liability, can only arise prospectively and cannot be applied retrospectively.
  2. [43]
    This reading of the Acts Interpretation Act is consistent with the general law, in particular such cases as Maxwell v Murphy[12] where Dixon CJ made a distinction between amended laws dealing with substance and those dealing with procedure. Laws of substance (that is, new laws affecting rights that have already accrued or immunities that have already been established or acquired) can only be prospective in nature while laws of procedure may operate retrospectively. He quotes with approval Sloan JA when he said:[13]

Perhaps there could be no more practical summary of the principle, which, as was said, emerges from the English and Canadian cases, than the following, - "unless the language used plainly manifests in express terms or by clear implication a contrary intention - (a) A statute divesting vested rights is to be construed as prospective. (b) A statute, merely procedural, is to be construed as retrospective. (c) A statute which, while procedural in its character, affects vested rights adversely is to be construed as prospective." - Dixie v. Royal Columbian Hospital (1941) 2 DLR 138, at pp 139, 140.

  1. [44]
    The amendment to the period of liability in s 56AC(2)(c)(ii) from 10 November 2017 is an amendment to a substantive law and should have prospective, not retrospective, operation.
  2. [45]
    A proper understanding of D’Arro v Queensland Building and Construction Commission[14] accords with this interpretation. In that case the issue before the Court concerned whether ss 56AC(3) and (4) of the QBCC Act were being given retrospective operation. The leading judgment was that of Fraser JA, the other judges agreeing. In a key comment His Honour said, ‘[this] sentence describes the distinction I regard as applicable in this case’ when quoting a passage from Windeyer J in Ogden Industries Pty Ltd v Lucas:[15]

… I do not think it is the sense in which it is said that an amending Act does not disturb existing liabilities arising out of past transactions. That to my mind describes a liability having become complete by past events rather than a situation in which some future event must occur to make the effect of past events create a completed liability.

  1. [46]
    In other words, if a liability has matured, an amending Act cannot affect the liability; but if a liability is inchoate, accrued, incomplete or yet to be realised, an amending Act may have an effect upon the later reconsideration of a decision.[16]
  2. [47]
    It is not a difficult extrapolation to refer not only to liabilities in this context, but to offences, privileges, rights and penalties.
  3. [48]
    In the matters before this Tribunal the penalty on Buchanan had been imposed (or would have been but for his actions in forestalling it). That is, he had been declared an excluded individual in the case of QUBE North on 16 May 2017, and in the case of QUBE Projects on 1 September 2017. In the absence of any submissions from him within the allowed 28 days in each case, as it concerned QUBE North he became an excluded individual and, in the matter of QUBE Projects, a permanently excluded individual by the operation of s 56AF and s 58 of the QBCC Act.[17] The penalties to which he was subject had occurred (or would have but for Buchanan’s applications) and were not inchoate.
  4. [49]
    Therefore, I conclude that the law that applies in these matters to the period of liability under s 56AC(2)(c)(ii) is that which applied before 10 November 2017, namely, a period of one year.

Appointments to QUBE North and QUBE Projects

  1. [50]
    In respect of QUBE North and QUBE Projects Buchanan testified that these companies needed his licences in order to undertake building and construction work, and that he was paid a wage.
  2. [51]
    On the face of the record as it appears in ASIC, Buchanan held the following positions with QUBE North:

 

Appointed

Ceased

Director

8 Feb 2016

13 Dec 2016

Secretary

8 Feb 2016

13 Dec 2016

  1. [52]
    QUBE North had liquidators appointed on 3 April 2017. Buchanan was, within the period of one year immediately before the appointment of the liquidators, a director and secretary of QUBE North. The QBCC notice dated 16 May 2017 that he is an excluded individual appears, therefore, to be correct and in order in respect of this event.
  2. [53]
    On the face of the record as it appears in ASIC, Buchanan held the following positions with QUBE Projects:

 

Appointed

Ceased

Appointed

Ceased

Director

15 Apr 2015

19 Aug 2015

28 Aug 2015

13 Jan 2016

Secretary

15 Apr 2015

19 Aug 2015

17 Nov 2016

24 Dec 2016

  1. [54]
    QUBE Projects had liquidators appointed on 24 May 2017. Buchanan appears on the record as being, within the period of one year immediately before the appointment of the liquidators, a secretary of QUBE Projects. He is not on the record as being a director of QUBE Projects within the period of one year before liquidators were appointed to QUBE Projects.
  2. [55]
    In this case, however, Buchanan said that he had resigned from the positions of director and secretary of QUBE Projects with effect from 19 August 2015 and never sought to be reappointed. He said that his reappointment was done without his knowledge or authority. If this is correct, then Buchanan was not a director or secretary of QUBE Projects within one year of the appointment of the liquidators and, therefore, should not be an excluded individual and, therefore, not a permanently excluded individual.
  3. [56]
    Buchanan said that he submitted his resignation as a director and secretary of QUBE Projects to Drew Smith, apparently the principal of accounting firm WHK Pinnacle,[18] located at 33-35 Oldaker St, Devonport, Tasmania. This address in Devonport Tasmania was also the registered address and a principal place of business of each of QUBE North and QUBE Projects.
  4. [57]
    Among the documents filed by Buchanan there is a letter from him dated 19 August 2015 to ‘The Director’ of QUBE Projects in which he submits his resignation as a secretary of ‘the company’, presumably QUBE Projects, ‘… effective from the date of this letter.’ This is consistent with his ceasing to be a director and secretary of QUBE Projects from 19 August 2015, although there is no document supporting Buchanan’s resignation as a director of QUBE Projects from this date.
  5. [58]
    In his submission to ASIC dated 10 October 2017 Buchanan made the following comments [sic]:

I am requesting ASIC correct an incorrect and illegal lodgement of an appointment of Secretary of Qube Projects Pty Ltd on the 17.11.2016 … LODGED 17.11.2016 …

I ceased being a Secretary of the company on the 19.08.2015 … I was not a Director or any part of the company as of the 13.01.2016 …

I have only recently been made aware that i was added as a Secretary at a later date (which is a false document …) I wasn’t even a director at the time of that lodgement? Which states that I lodged the document …

I ask ASIC to please correct my removal of Secretary back to the correct date of 19.08.2015 as this is the true and correct date of my resignation as Secretary.

  1. [59]
    Buchanan gave testimony at the hearing to the same effect as the circumstances described in this extract.
  2. [60]
    Buchanan did not dispute that he remained a director of QUBE Projects until 13 January 2016. This is supported by a hand-written notation made by Buchanan on the ASIC extract created on 4 October 2017 which says [sic]:

I was not even a director at this time? I ceased as a Director as of 13.01.2016.

  1. [61]
    Based on Buchanan’s testimony and this trail of documents, I am entitled to draw the following conclusions:
    1. Buchanan resigned as secretary of QUBE Projects on 19 August 2015;
    2. Buchanan did not resign as director of QUBE Projects on 19 August 2015, and that he was removed from the record when he ought not to have been removed, and was restored as a director on the record from 28 August 2015;
    3. Buchanan remained a director of QUBE Projects with his consent until 13 January 2016;
    4. Buchanan did not consent to his being recorded as secretary of QUBE Projects after 19 August 2015.
  2. [62]
    I am fortified in drawing these conclusions based on the following analysis:
    1. The record supports Buchanan’s evidence that he resigned as a secretary on 19 August 2015;
    2. Buchanan admitted that he remained a director until 13 January 2016, consistent with the ASIC record;
    3. There is no obvious, or even evident, reason why he would have consented to be re-appointed as a secretary of QUBE Projects on 17 November 2016 as the ASIC record discloses, and he denies that he did so consent;
    4. Again, there is no obvious, or even evident, reason why Buchanan would have consented to being a secretary up to 24 December 2016 when, on the other hand, he ceased being a director on 13 January 2016; and
    5. Buchanan is on the ASIC record as being a secretary on the second occasion for only 37 days (17 November 2016 to 24 December 2016) after a gap of 15 months from the date he had earlier resigned.
  3. [63]
    Put briefly, there is nothing to suggest that Buchanan’s assertion that he was improperly and without his consent appointed a secretary is untrue. On the relevant test I accept Buchanan’s assertion that he was not properly appointed a secretary of QUBE Projects after 19 August 2015.
  4. [64]
    It therefore follows that Buchanan was not a director or secretary of QUBE Projects within one year of the date on which liquidators were appointed to QUBE Projects.
  5. [65]
    The QBCC notice dated 16 May 2017 also makes reference to Buchanan being an influential person for the purposes of the QBCC decision that Buchanan is an excluded individual. While the QBCC did not argue at the hearing that Buchanan was an influential person (rather than a director or secretary) of QUBE Projects, for completeness this issue needs to be considered.
  6. [66]
    Section 4AA(1) of the QBCC Act defines an influential person for this purpose:

An influential person, for a company, is an individual, other than a director or secretary of the company, who is in a position to control or substantially influence the company’s conduct.

  1. [67]
    The evidence demonstrated that QUBE North and QUBE Projects were financially intermingled and that Buchanan had no apparent influence over the financial arrangements involving the companies. Buchanan testified that his involvement with the companies was sought because of his Queensland and Victorian builder’s licences, and that he derived a wage from his involvement.
  2. [68]
    Based on the evidence I am satisfied that Buchanan was not an influential person within the meaning of that term in the QBCC Act in respect of either QUBE North or QUBE Projects.
  3. [69]
    I conclude that there has not been a second event giving rise to Buchanan being properly declared an excluded individual as notified by the QBCC in its notice dated 16 May 2017.
  4. [70]
    Therefore, having been declared an excluded individual for one relevant event only, Buchanan is not a permanently excluded individual.
  5. [71]
    The QBCC notice dated 16 May 2017 is set aside and of no effect.
  6. [72]
    While this conclusion and decision is sufficient to resolve this application, there remains the important issue of whether the QBCC decision that Buchanan is a permanently excluded individual based on two events of insolvency should be set aside also on the basis that the two events flow from what is, in substance, the one set of circumstances. This is examined next.

Whether the two liquidations arise from the one set of circumstances

  1. [73]
    If the two events, namely liquidators being appointed to QUBE North and QUBE Projects respectively, flow from what is, in substance, the one set of circumstances, then s 56AC(5) of the QBCC Act should apply, and the two events will be treated as one event. The benefit for Buchanan of the two events being found to flow from one set of circumstances is that he will be an excluded individual subject to having his licences cancelled for three years rather than being a permanently excluded individual.
  2. [74]
    The effect of s 56AC(5) applies to the matters here because all relevant events occurred after this provision came into force. There is no issue arising here, such as in D’Arro v Queensland Building and Construction Commission, concerning any potential retrospective action of laws.
  3. [75]
    The QBCC Act does not provide guidance as to what constitutes two events being found to flow from one set of circumstances so, to understand its meaning, it becomes necessary to consider extrinsic material.
  4. [76]
    There is scant reference to s 56AC(5) in reported cases to assist in defining the scope of this provision. Only the cases of Jensen v Queensland Building and Construction Commission[19] and Paddon v Queensland Building and Construction Commission[20] appear to mention the provision but neither has had to examine its extent.
  5. [77]
    Guidance as to the meaning of what constitutes two events being found to flow from one set of circumstances can be garnered from the reports of relevant government committees and inquiries, and the Minister’s second reading speech.
  6. [78]
    A 2012 Parliamentary Committee made the following recommendation, which appears to be the genesis of the present provision:[21]

The Committee recommends that the Minister for Housing and Public Works seek amendment to the QBSA Act to provide that where an individual’s ‘relevant bankruptcy event’ and ‘a relevant company event’ stem from the same financial incident, that they be deemed one event for the purposes of penalties.

  1. [79]
    The Second Reading speech of the Minister for Housing and Public Works described the intended operation of the provision as being:[22]

… it is proposed to amend the QBCC Act to more clearly identify that a licensee ought not to be categorised as a ‘permanently excluded individual’ merely as a result of a ‘relevant bankruptcy event’ and a ‘relevant company event’ arising out of the same incident. This proposed amendment stems from issues raised during the parliamentary committee hearings that bankruptcy and company insolvency events arising from the same circumstances should be treated as a single event. To do otherwise is clearly unfair.

  1. [80]
    The compelling conclusion from these sources is that, in order for two events to be found to flow from one set of circumstances, the events must be so closely linked that they would constitute two consequences from the one event or series of events, not comprise two or more events with similar characteristics. That is, the events would have to be similar to a ‘relevant bankruptcy event’ and a ‘relevant company event’ arising out of the same incident. It is not sufficient that there be two relevant company events arising from similar circumstances, such as has occurred in these matters.
  2. [81]
    In the matters here Buchanan has argued that the circumstances surrounding the appointment of liquidators to QUBE North and QUBE Projects were sufficiently similar that they should be treated as comprising one set of circumstances. Section 56AC(5) does not support that contention.
  3. [82]
    For the purposes of s 56AC(5) of the QBCC Act the appointment of liquidators to each of QUBE North and QUBE Projects are separate events.

Conclusions

  1. [83]
    The decision of the QBCC dated 16 May 2017 concerning Buchanan and QUBE North has been properly made.
  2. [84]
    The decision of the QBCC dated 1 September 2017 concerning Buchanan and QUBE Projects was an inappropriate exercise of its power because Buchanan was not a director or secretary of, or influential person for, QUBE Projects within one year of the appointment of liquidators to the company.
  3. [85]
    The liquidation of QUBE North and QUBE Projects did not flow from what is, in substance, the one set of circumstances.

Decision

  1. [86]
    The decision of the Respondent made on 16 May 2017 in respect of QUBE North is confirmed.
  2. [87]
    The Respondent is to set a date which it deems appropriate from which the licences of the Applicant are to be cancelled for the period prescribed by law.
  3. [88]
    The decision of the Respondent made on 1 September 2017 in respect of QUBE Projects is set aside and of no effect.

Footnotes

[1]Licence number 1017837.

[2]QUBE North was incorporated on 12 January 2016.

[3]QUBE Projects was incorporated on 15 April 2015.

[4]Through a company, Melvic Constructions Pty Ltd.

[5]This is matter is OCR 121-17.

[6]This is matter is OCR 215-17.

[7]Building Industry Fairness (Security of Payment) Act 2017 (Qld), s 271.

[8]QBCC Act, s 59(a).

[9][2019] QCA 66.

[10][2017] QCA 90.

[11]Liability is defined broadly as meaning any liability or obligation (whether liquidated or unliquidated, certain or contingent, or accrued or accruing). Penalty is defined to include forfeiture and punishment.

[12]  [1957] HCA 7; (1957) 96 CLR 261.

[13]  [1957] HCA 7, [13].

[14]  [2017] QCA 90.

[15]  (1967) 116 CLR 537, 584.

[16]  D’Arro v Queensland Building and Construction Commission, [30], [33].

[17]  Except that he did not become a permanently excluded individual for reasons that are explained later in this decision.

[18]  The firm WHK Pinnacle later changed its name to Crowe Horwath.

[19]  [2017] QCAT 232.

[20]  [2018] QCAT 100.

[21]  Inquiry into the Operation and Performance of the Queensland Building Services Authority 2012, Report No. 14, Transport, Housing and Local Government Committee, November 2012, Recommendation 35.

[22]  When presenting the Professional Engineers and other Legislation Amendment Bill 2014.

Close

Editorial Notes

  • Published Case Name:

    Casey Buchanan v Queensland Building and Construction Commission

  • Shortened Case Name:

    Buchanan v Queensland Building and Construction Commission

  • MNC:

    [2019] QCAT 354

  • Court:

    QCAT

  • Judge(s):

    Member Collier

  • Date:

    20 Nov 2019

Appeal Status

Please note, appeal data is presently unavailable for this judgment. This judgment may have been the subject of an appeal.

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