Chief Executive, Department of Justice and Attorney-General v Sheppard [2014] QCAT 347

CITATION: Chief Executive, Department of Justice and Attorney-General v Sheppard [2014] QCAT 347 PARTIES: Chief Executive, Department of Justice and Attorney-General (Applicant) v Lindy Joy Sheppard (Respondent) APPLICATION NUMBER: OCR020-14 MATTER TYPE: Occupational regulation matters HEARING DATE: On the papers HEARD AT: Brisbane DECISION OF: Member Paratz DELIVERED ON: 15 July 2014 DELIVERED AT: Brisbane ORDERS MADE: 1. Lindy Joy Sheppard is reprimanded. 2. Lindy Joy Sheppard is disqualified from holding any form of licence or certificate of registration issued under the Act (or legislation subsequently enacted within Queensland which regulates the real estate industry or occupation) for a period of 5 (five) years. 3. Lindy Joy Sheppard must successfully complete the subjects PRDRE 28A (Maintain trust account) or its equivalent and PRDRE37A (Perform and record property management activities and transactions) or its equivalent prior to making any further application for any form of licence or certificate of registration issued under the Act (or legislation subsequently enacted within Queensland which regulates the real estate industry or occupation). 4. Lindy Joy Sheppard is to pay the Chief Executive, Department of Justice and Attorney-General a fine of $1,000 by 1 December 2014. -- 1 of 7 -- 2 5. Lindy Joy Sheppard is to pay Imoda Management Pty Ltd an amount of $3,550.00 by 1 December 2014. CATCHWORDS: Where a Senior Property Manager took an amount of $3,550 over three occasions – where the manager had a gambling addiction – remorse shown – where grounds for disciplinary proceedings shown Property Agents and Motor Dealers Act 2000 (Qld), s 496(1)(h)(ii), s 529 Chief Executive DTFTWID v Matheson [2006] QCCTPAMD 29 Chief Executive DTFTWID v Turner [2003] PAMDT X011-03 Chief Executive, Department of Justice and Attorney-General v Lake [2014] QCAT 282 APPEARANCES and REPRESENTATION (if any): 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). REASONS FOR DECISION [1] Ms Sheppard was a Property Manager at Ken Guy Real Estate Mooloolaba. An Application for disciplinary proceedings against her was filed by the Chief Executive on 28 January 2014. [2] The grounds of the application were that Ms Sheppard, as an employee, used her position to misappropriate $3,550 from her employer’s trust account, and that pursuant to s 496(1)(h)(ii) has in performing an activity of a licensee, been incompetent or acted in an unprofessional way. [3] I made Directions on 5 February 2014 as to the filing of material in this Application. The Chief Executive has filed material and submissions as directed. No material or submissions have been filed by Ms Sheppard. No request for an oral hearing was made by either party. In accordance with the directions, a decision on the papers would be made after 30 April 2014. This is the decision in this Application. [4] Ms Sheppard held a Real Estate Salesperson’s certificate of registration issued on 15 November 2010 which expired on 15 November 2011. It was reinstated on 12 April 2013 and expired on12 April 2014. [5] On Monday 22 April 2013 at 6:06am Ms Sheppard sent an email to her employer, which included the following paragraphs: -- 2 of 7 -- 3 I have something to tell you both. I have a very bad gambling addiction and I took the $1,000 and I just took $750 and I took the bond money for 12 Carwoola Crescent. I am going to the police today to tell them what I have just told you. I am looking at this as a positive because something needed to change in my life. The police will be in contact with you about what I have done. I can only apologise and tell you this is not the person I am and I want my life back. I am 50 years old and my life is ruled by an addiction. My sister is my strength and she has tried to help me but this is something only I can do. I am ready to take my punishment and am so sorry to do this to you as you are all wonderful people and I loved working there but this had to happen this is the only way that I am going to get the help I need. …I have to go to the police and I will be moving as this has not only destroyed my career it has destroyed my relationship. [6] Ms Rosemary Brady is the General Manager/Partner of Imoda Management Pty Ltd trading as Booom Property Management. Prior to 1 September 2013 the company was trading as Ken Guy Mooloolaba for its Sunshine Coast operations. She received the email from Ms Sheppard about the theft of the monies. [7] She states that Ms Sheppard was employed as a Senior Property Manager on 4 February 2013. Her duties encompassed managing a portfolio of clients, acting as a mentor to the more junior members of staff as well as performing the daily receipting of monies, banking and mid and end of month disbursements from the trust account. [8] She says that the initial $1,000 was supposed to be banked by Ms Sheppard on Friday 23 March 2013. Ms Sheppard told the Operations Manager on Monday morning that she had missed the bank, and that when she checked her handbag on Monday morning 25 March 2014, the envelope with $1,000 in cash and a couple of cheques was gone. The cheques were later found in Ms Sheppard’s desk drawer files. [9] Ms Brady speculates that the trigger for Ms Sheppard’s confession was that an announcement was made that a bond audit was going to be undertaken starting on that Monday, and the missing $1,800 bond payment would have been discovered. [10] The allegation against Ms Sheppard is only in respect of the amount of $3,500. However, Ms Brady does refer to some unusual dealings with the Trust Account handling. Those dealings could have related to monies being taken from the trust account and replaced, which is a pattern that could be surmised as being used by someone with a gambling addiction who was using the trust account moneys as a “bank”. However, there is no evidence that this did occur. The observation was that:- Subsequent investigations for the period of Lindy’s employment as the senior Property Manager responsible for the banking and daily trust reconciliations indicated that she was not banking the funds within 24 hours from receipt. She was receipting them in the trust account on the correct day but reversing the deposit with the explanation such as “receipted as -- 3 of 7 -- 4 EFT should have been cash” and then not actually banked for a couple of more days. She ensured that the trust account was in order at the end of each month which was when I reviewed the reports. [11] An audit of the Trust Account by Synergy Audit identified three instances of cash receipted by Ms Sheppard in the software system but not subsequently banked in the Trust Account, as follows1:- 8 March 2013 $1,800.00 Bond 22 March 2013 $1,000.00 Rent 18 April 2013 $ 750.00 Rent [12] A Record of Interview was conducted with Ms Sheppard and Mr Noel Baillie, an Inspector from the Office of Fair Trading on 15 October 2013. [13] Ms Sheppard was asked about taking the money:- [NB] Okay, why did you take this money? [LS] I was a gambling addict. Well, probably still am ‘cause you never get out of it. [NB] Did the company give you authority to take this money? [LS] No [NB] Have you paid the money back? [LS] No. I did, um, when it happened I was speaking with Jay, the owner and he, well I sent him my Gmail address and he was going to, like, organize some sort of payment but I haven’t heard from him since, so. [NB] Can you pay the money back? [LS] Slowly, yes. [NB] Do you intend to seek further employment in the real estate industry? [LS] I would like to, yes. [14] The actions of Ms Sheppard in taking the money clearly constitute grounds for starting a disciplinary action pursuant to s 496(1)(h)(ii) of the Act in that in performing an activity of a licensee, she has acted in an unprofessional way. [15] The Tribunal may make a range of orders against a person in relation to whom the Tribunal finds ground exist to take disciplinary action, pursuant to s 529 of the Act. Penalty [16] The Chief Executive notes that the conduct involved stealing $3,550 of trust money on three occasions over a four week period. It submits that the conduct involved some manipulation of trust account records in an effort to hide the activity. It describes Ms Sheppard as having been in a position of significant responsibility and trust and having betrayed her employer, her clients and the community. 1 Letter Synergy Audit Specialists Pty Ltd to OFT 11 November 2013. -- 4 of 7 -- 5 [17] No material has been provided in relation to any criminal prosecutions against Ms Sheppard in relation to these matters. [18] The Chief Executive seeks the following penalty:- 1. The Respondent be reprimanded. 2. The Respondent be disqualified from holding any form of licence or certificate of registration issued under the Act (or legislation subsequently enacted within Queensland which regulates the real estate industry or occupation) for a period of 5 (five) years. 3. The respondent must successfully complete the subjects PRDRE 28A (Maintain trust account) or its equivalent and PRDRE37A (Perform and record property management activities and transactions) or its equivalent prior to making any further application for any form of licence or certificate of registration issued under the Act (or legislation subsequently enacted within Queensland which regulates the real estate industry or occupation). 4. The Respondent pay the Applicant a fine of $1,000 by 1 December 2014. 5. The Respondent pay Imoda Management Pty ltd an amount of $3,550.00 by way of compensation for the funds lost to the business by 1 December 2014. 6. The Respondent be prohibited from holding or obtaining any form of licence or certificate of registration issued under the Act (or legislation subsequently enacted within Queensland which regulates the real estate industry or occupation) if the terms of order 5 are not dealt with in a manner to the satisfaction of the applicant. [19] The Chief Executive refers to Matheson2 and Turner3 as comparable cases. [20] In Matheson a real estate salesperson stole $13,200 from rents and bonds over a three month period. She showed remorse and was co-operative with the Police and Inspectors from the Office of Fair Trading. She was disqualified for 10 years and ordered to pay legal costs. [21] In Turner a real estate salesperson stole $12,000 on 68 occasions over nine months. She showed some level of remorse and made substantial reparation. She was disqualified for 10 years and ordered to pay legal costs. [22] Both of these cases involved larger amounts of money and a more prolonged and repeated course of conduct. [23] I have regard to a previous QCAT matter case Number OCR217-114. I refer to that case in my recent decision in Chief Executive, Department of Justice and Attorney-General v Lake.5 2 Chief Executive DTFTWID v Matheson [2006] QCCTPAMD 29. 3 Chief Executive DTFTWID v Turner [2003] PAMDT X011-03. 4 OCR217-11 QCAT 20 September 2012. -- 5 of 7 -- 6 [24] In OCR217-11 an assistant property manager misappropriated $2,665.00 from her employer’s trust account. There was substantial material in mitigation. The Chief Executive initially sought a disqualification period of three years. After further consideration, consent orders were put forward which the Tribunal agreed with, and a disqualification period of six months was imposed. [25] In Lake, an assistant property manager misappropriated $4,312.86. No explanation of her conduct, or any material in mitigation was provided. I ordered that she be disqualified for three years. [26] Ms Sheppard has expressed strong remorse. She has attributed the events to a gambling addiction. However, she has not adduced any evidence as to any treatment she has sought or obtained in relation to her addiction. The public need to be protected in the handling of their monies. Ms Sheppard has not demonstrated that she is not a continuing threat to the public in the handling of monies. A period of disqualification is therefore appropriate to provide this protection. [27] The amount which Ms Sheppard took was slightly more than the amounts in OCR217-11 and in Lake. Further, Ms Sheppard was in a more senior position of trust than the managers in those cases, who were assistants. Therefore a longer period of disqualification should apply. [28] I adopt the submission of the Chief Executive that a period of disqualification of five years is appropriate in this matter. [29] The Chief Executive has sought an order that if Ms Sheppard does not make the compensation payment as ordered ‘in a manner to it’s satisfaction’, that she should be absolutely disqualified. I do not consider that such an order is appropriate, as the period of disqualification is related to the nature of the offence, and should be assessed accordingly. Further, a penalty should not be subject to the administrative decision of the Chief Executive, the power to determine disciplinary proceedings being vested in the Tribunal. I will not therefore make such an order. [30] It is appropriate that a fine should be imposed as a monetary penalty on Ms Sheppard. I adopt the submission of the Chief Executive that a fine of $1,000 is appropriate in the circumstances. [31] Ms Sheppard should compensate the real estate agency for the loss of $3,550.00 which it has suffered. I adopt the submissions of the Chief Executive in this regard (which have not been challenged by Ms Sheppard) and will allow her until 1 December 2014 to make such payment. [32] Ms Sheppard should be reprimanded, and it would be for her and the public benefit, for her to undergo appropriate further training before re- 5 [2014] QCAT 282. -- 6 of 7 -- 7 entering the property industry if she chooses to do so, as she indicates. I adopt the submissions of the Chief Executive in those regards also. [33] I will make formal orders pursuant to s 529 of the Act in terms of these findings. -- 7 of 7 --