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Queensland Judgments

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Authorised Reports & Unreported Judgments
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Ezra Constructions Pty Ltd & Ors v Queensland Building and Construction Commission & Ors  
Unreported Citation: [2019] QSC 47
EDITOR'S NOTE

The first respondent issued notices to the applicants that it considered the third applicant to be an “excluded individual” under the Queensland Building and Construction Commission Act 1991.  The notices were issued under the statutory regime that existed before the Queensland Building and Construction Commission and Other Legislation Amendment Act 2014 came into force, but did not fully comply with the requirements of that regime.  The question before Boddice J was whether those notices were valid.  In deciding those notices were not valid, his Honour engaged in an interesting discussion of the impact of the amending legislation on the statutory regime, and any rights that may have existed under it.

Boddice J

12 March 2019

The first respondent issued four notices to the applicants – one each for the first two applicants and two for the third applicant – on 5 April 2018. [9]–[11]. These notices purportedly gave the applicants notice under ss 56AG and 56AF of the Queensland Building and Construction Commission Act 1991 (“the QBCC Act”), respectively, that it considered the third applicant to be an “excluded individual”.  The third applicant was formerly director of RT No 2 Pty Ltd and RT No 3 Pty Ltd. [6]–[7]. He resigned from those directorships shortly before each company was placed into administration, in each case owing several million dollars to its creditors. [6]–[7]. The third applicant resigned as the companies’ director on 29 September 2014 and 1 January 2015, respectively. [6]–[7]. 

The notices relied on the appointment of administrators in RT No 2 Pty Ltd and RT No 3 Pty Ltd, gave the applicants 28 days to make submissions, and warned that the applicants’ licences may be cancelled. [9]–[11].

The applicants duly provided submissions on 3 May 2018. [12]. On 18 June 2018, the first respondent issued notices to the applicants, advising that each applicant was an excluded company or individual by reason of the appointment of an administrator for RT No 2 Pty Ltd. [13]. The notices advised that the applicants were not excluded by reason of the appointment of administrators to RT No 3 Pty Ltd. [13]. The applicants sought relief in respect of these notices in the Supreme Court. [1].

Significantly in the present case, the QBCC Act was amended by the Queensland Building and Construction Commission and Other Legislation Amendment Act 2014 (“the Amendment Act”), the relevant provisions of which commenced operation on 1 July 2015. [16]. Notably, the Amendment Act repealed s 56AD of the QBCC Act, by which an excluded individual could apply to be categorised as a permitted individual. [16]. Such categorisation had the effect of preventing an individual or the company of which they were director or an influential person in from being subject to licence exclusion and cancellation under ss 56AF and 56AG of the Act.

Further, pre-amendment, s 56AF(2)(b) required that the first respondent give an individual it considered to be an excluded individual a written notice stating that they could apply to be categorised as a permitted individual.  Similar notice had to be given to companies the first respondent considered to be excluded companies under s 56AG(2)(c).  It does not appear that the applicants would have been excluded companies or individuals under the amended s 56AC.

In considering the application, Boddice J found that the changes introduced in the Amendment Act were “significant changes to a regime which materially affected the rights of individuals and companies”. [29]. They took away a “substantive right”: the entitlement to apply to be categorised as a permitted individual and thereby avoid the consequences of being considered an excluded individual. [29]. Accordingly, his Honour found that the presumption that a statute will be assumed not to have retrospective operation in the absence of a clear statement to the contrary applied. [30].

Boddice J then turned to whether there was a clear intention which would allow the first respondent to provide notice under the pre-amendment ss 56AF and 56AG, but not give notice of the permitted individual provisions. [32]. His Honour could find no such intention in the amending provisions. [32]–[33]. Similarly, no such clear intention was evidenced from the “standard transitional provisions”, which, if anything, were “consistent with an intention on the part of the legislature for the first respondent to have the ability to categorise a person as a permitted individual, despite the repeal of s 56AD of the Act.” [35].

Boddice J next found that, as the requirements of s 56AC pre-amendment were met, the first respondent’s reliance on that regime “directly affects the right the third applicant had under that regime to apply to be categorised as a permitted individual.” [36]. The issuing of notices pursuant to s 56AC triggered a disadvantage of the kind considered by the Court of Appeal in D’Arro v Queensland Building and Construction Commission [2017] QCA 90. [36].

Ultimately, his Honour concluded that if, as here, the first respondent elected to avail itself of the pre-Amendment Act provisions to issue a notice, it was under an obligation to ensure the notice complied with the statutory requirements governing such notices. [38]. It followed that the first notices dated 5 April 2018 were not valid notices and should be set aside. [39].

Boddice J concluded by turning to the appellant’s submission that the appointment of an administrator for RT No 2 Pty Ltd was not “for the benefit of a creditor”, and so s 56AC did not apply. [41]. His Honour quickly disposed of this argument, finding that “for the benefit of a creditor” ought to be given a wide interpretation. [44]. Regardless of the primary purpose of an administrator being appointed, “there is still a benefit to creditors in that appointment” as, at the very least, one of the administrator’s obligations is to prepare a report to creditors. [45]. It followed that the appointment of an administrator to RT No 2 Pty Ltd was for the benefit of a creditor. [46].

M Paterson