A B Hill Constructions Pty Ltd v Queensland Building and Construction Commission [2017] QCAT 391

CITATION: A B Hill Constructions Pty Ltd v Queensland Building and Construction Commission [2017] QCAT 391 PARTIES: A B Hill Constructions Pty Ltd (Applicant) v Queensland Building and Construction Commission (Respondent) APPLICATION NUMBER: OCR233-17 MATTER TYPE: Occupational regulation matters HEARING DATE: 30 October 2017 HEARD AT: On the papers decision DECISION OF: Member Olding WRITTEN REASONS DELIVERED ON: 8 November 2017 DELIVERED AT: Brisbane ORDERS MADE: The decision of the Queensland Building and Construction Commission dated 17 October 2017 is stayed, pending the determination of the application to review or until further order of the Tribunal, subject to A B Hill Constructions Pty Ltd (the Company) undertaking to provide to the Queensland Building and Construction Commission: a. a Minimum Financial Requirements Report within 28 days of this order; and b. weekly reporting of its financial position, including: i. aged debtors; ii. aged creditors; iii. print out of bank account, to show the current cash at bank; iv. itemised ATO Portal statements; v. any correspondence with creditors regarding payment arrangements -- 1 of 5 -- 2 or any alleged default by the Company; and vi. copies of any proceedings by any creditor, whether by claim or statutory demand or application to wind up; until the determination of the application to review, or until further order. CATCHWORDS: ADMINISTRATIVE LAW – ADMINISTRATIVE TRIBUNALS – QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL – whether desirable to make a stay order in respect of a decision to suspend a builder’s licence – where applicant failed to meet Minimum Financial Requirements Policy conditions – where stay granted subject to applicant’s undertaking to report financial data to the Queensland Building and Construction Commission weekly Queensland Building and Construction Commission Act 1991 (Qld), s 35, s 48(1)(h) Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 20(1), 22 NGE v Queensland Building and Construction Commission [2017] QCAT 238 APPEARANCES: This matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) (QCAT Act). REPRESENTATIVES: APPLICANT: represented by Johanson Lawyers RESPONDENT: represented by Holding Redlich Lawyers REASONS FOR DECISION [1] A B Hill Constructions Pty Ltd (the Company) has applied to the Tribunal for review of the decision of the Respondent Commission to suspend its builder’s licence on the basis that the Company has failed to satisfy the Minimum Financial Requirements (MFR) Policy, which is a condition of the licence. -- 2 of 5 -- 3 [2] The Company also sought a stay of that decision pending the determination of the review. [3] I made a stay order on condition that the Company undertakes to provide an MFR report to the Commission within 28 days, along with weekly reports of its financial position. [4] My reasons for granting the stay follow. Background [5] The Commission may suspend a licence if the licensee contravenes a condition to which the licence is subject under the Queensland Building and Construction Commission Act 1991 (QBCC Act), s 35.1 [6] Under s 35, a contractor’s licence is subject to the condition that “the licensee’s financial circumstances must at all times satisfy the relevant financial requirements stated in the [Queensland Building and Construction] board’s policies”. The relevant policy is the MFR Policy. [7] The Commission noted that the Company has breached the Policy in two respects as discussed further below. The issue for determination at the hearing of the application for review will be whether suspension of the Company’s licence is the correct and preferable decision.2 The Tribunal’s power to grant a stay [8] The Tribunal may make an order staying the suspension decision “only if it considers the order is desirable after having regard to the following: (a) the interests of any person whose interests may be affected by the making of the order or the order not being made; (b) any submissions made to the tribunal by the decision-maker for the reviewable decision; (c) the public interest”.3 [9] The Tribunal, in considering stay applications, also takes into account whether the applicant has an arguable case and the balance of convenience.4 1 QBCC Act, s 48(1)(h). 2 QCAT Act, s 20(1). 3 QCAT Act, s 22. 4 See NGE v Queensland Building and Construction Commission [2017] QCAT 238 for an example of the application of the principles applicable to stay applications in the context of a review of a decision to suspend a builder’s licence. -- 3 of 5 -- 4 Consideration [10] The Commission did not contest that declining to make a stay order would adversely affect the Company and its owners. The Company also provided several statements from customers asking for the suspension to be lifted because of the impact on their projects. [11] However, the Commission submitted that it is not in the interests of the public or the building industry for a company that is breach of the MFR condition to continue to hold a licence. [12] The Commission also submitted that the Company’s prospects of success in the application for review are poor, pointing to the two breaches of the MFR. [13] The first is a failure to notify the Commission that the Company’s net tangible asset position had decreased by more than 30% from its previously notified position and to provide a new declaration or MFR report to the Commission within 30 days of that occurring. [14] The second is a breach of the requirement to pay all undisputed debts as they fall due and within industry norms. The Commission noted that there had been two dishonoured payments under the statutory insurance scheme and other third party debts not paid as they fell due. The latter included six notified to the Commission in recent “Monies Owed Complaints”. [15] The Company did not deny that the breaches occurred but pointed to steps taken, and anticipated receipts, that should remedy the Company’s financial position, which its director, Adrian Brendan Hill, in a declaration filed in support of the application, said reflects the “ebbs and flows” of the industry. [16] One of those steps is that on 27 October 2017 the Company engaged its accountant to prepare a new MFR report. It is a concern that this has only now occurred without any explanation for the delay in attending to this requirement. Mr Hill’s references to the “ebbs and flows” of the industry are no doubt correct, but this should not have prevented compliance with the requirement to notify the Commission of the reduction in net tangible assets and update its MFR status. [17] These factors raise a concern regarding the Company’s commitment to meeting the conditions of its licence and may weigh against the Company in the hearing of the application for review. [18] The instances of failure to pay debts as they fall due are also of concern and may also weigh against the Company on the hearing of the review. On the other hand, information provided by the Company indicates that the aged debts have now been cleared or payment arrangements entered into and that a significant net inflow of funds from four projects is anticipated in the near future. Additionally, information was provided regarding pending sales of properties, although specific detail of the net amounts likely to be realised and available to the Company was not. -- 4 of 5 -- 5 [19] In these circumstances, I cannot conclude that the Company has poor prospects of success in the review. If it provides a new MFR report and the anticipated funds materialise, having regard to all the circumstances at the time of the hearing the Tribunal may be persuaded that suspension would not be the correct and preferable decision at that time. [20] The risk to the public and the industry in the meantime is a significant factor weighing against a stay where, as in this case, there have been various instances of failure to pay debts as they fall due. However, I am satisfied that, balancing the drastic impact on the Company and its customers of not granting the stay, that risk would be sufficiently mitigated by the reporting and other conditions attached to the stay order. If the circumstances change, such that further risk emerges, it will be open to the Commission to apply to the Tribunal for variation or withdrawal of the stay. [21] In those circumstances, it is my view that the balance of convenience favours granting the stay subject to the reporting and other conditions. The Company sought fortnightly, rather than weekly, reporting because: “it will take 2 weeks at least for works to be restarted and a (sic) progress claims to be made and processed by the owners’ bank. A weekly reporting condition will show little change for the first weeks.”5 [22] I was not persuaded that the absence of significant change in the Company’s financial situation for the first few weeks after the stay is a reason for fortnightly rather than weekly reporting for the whole of the period in which the Company may be trading pending the determination of the review. In circumstances where the Company has a recent history of not meeting its debts as they fall due, involving some six complaints to the Commission in a few months, weekly reporting is appropriate. [23] Accordingly, I concluded that it is desirable to make a stay order, but subject to the reporting and other conditions set out in the order. 5 Applicant’s submissions dated 28 October 2017, paragraph 6. -- 5 of 5 --