Chief Executive, Department of Justice and Attorney General v Cameo Property Services Pty Ltd and Anor [2012] QCAT 509

CITATION: Chief Executive, Department of Justice and Attorney General v Cameo Property Services Pty Ltd and Anor [2012] QCAT 509 PARTIES: Chief Executive, Department of Justice and Attorney General v Cameo Property Services Pty Ltd Margaret Doris Johnson APPLICATION NUMBER: OCR201-12 MATTER TYPE: Occupational regulation matters HEARING DATE: On the papers HEARD AT: Brisbane DECISION OF: Peta Stilgoe, Senior Member DELIVERED ON: 18 October 2012 DELIVERED AT: Brisbane ORDERS MADE: 1. Cameo Property Services Pty Ltd and Margaret Doris Johnson are reprimanded. 2. Cameo Property Services Pty Ltd and Margaret Doris Johnson are disqualified from holding a licence or registration certification under the Property Agents and Motor Dealers Act 2000 for a period of two years. 3. Margaret Doris Johnson is disqualified from being an Executive Officer of a corporation that holds a licence or registration certificate under the Property Agents and Motor Dealers Act 2000 for a period of two years. 4. Cameo Property Services Pty Ltd shall pay $1,074.37 compensation to the Chief Executive Department of Justice and Attorney General by 18 January 2013. -- 1 of 4 -- 2 CATCHWORDS: REAL ESTATE AGENT – where payments from trust without authority – where trust money repaid – penalty Property Agents and Motor Dealers Act 2000, ss 10, 492, chapter 12, part 1 Chief Executive DTFTWID v Cornwell [2005] QCCTPAMD 49 Chief Executive DEEDI v Schellaars [2010] QCAT 477 Chief Executive DJAG v DJ Stringer Property Services Pty Ltd and Anor [2012] QCAT 27 APPEARANCES and REPRESENTATION (if any): This matter was heard and determined on the papers in accordance with section 32 of the Queensland Civil and Administrative Tribunal Act 2009. REASONS FOR DECISION [1] Cameo Property Services Pty Ltd and Ms Johnson are both real estate licensees under the Property Agents and Motor Dealers Act 2000. Ms Johnson is the sole director of Cameo. [2] The Chief Executive has referred them to the tribunal for disciplinary proceedings under s 496 of the Act, asserting that they have breached the Act and are not suitable to hold a licence and/or that they have been carrying on business in an unprofessional way. [3] Ms Johnson admits that, on five separate occasions, between June and September 2010, she withdrew trust funds without authority. She admits that the total sum withdrawn was $31,759.80. [4] Ms Johnson’s actions are a breach of her obligations under chapter 12, part 1 of the Act. A breach of the Act is a ground for disciplinary action1. I am therefore satisfied that disciplinary proceedings are appropriate. Penalty [5] In addition to a reprimand, the Chief Executive submits that both Cameo and Ms Johnson should be disqualified from holding any form of licence for a period of two years. The Chief Executive also submits that Ms Johnson should be disqualified from being an executive officer of a corporation that holds any form of licence for the same period and that she undertake a course of study before being permitted to reapply for a licence. The Chief Executive wants Cameo to pay compensation for lost interest in the sum of $1,074.37. 1 Section 492(1)(b). -- 2 of 4 -- 3 [6] One of the objects of the Act is to protect consumers against particular undesirable practices associated with the promotion of residential property.2 The objects of the Act are achieved mainly through: a) Ensuring only suitable persons are licensed.3 b) Ensuring that those who carry on business maintain close personal supervision of the way the business is carried on.4 c) Providing protection for consumers in their dealings with licensees.5 [7] Ms Johnson transferred trust money to her general account to pay business expenses. The number of licensees who succumb to this temptation is, unfortunately, increasing but that does not justify my taking a more lenient view of the penalty that should be imposed. The misuse of trust money is a very serious matter that goes to the heart of the consumer protection regime of the Act6. [8] Ms Johnson’s breach of the Act was revealed through a spot check conducted in September 2010. Investigators from the Department interviewed Ms Johnson in June 2011. At that time, she had repaid only $10,000 of the $31,759.80 wrongfully withdrawn from trust. She has now repaid all of the money. [9] Although Ms Johnson has cooperated fully with the Department, she deliberately withdrew money from trust when she knew that she had no authority to do so. She did not volunteer the information to the Department until the spot check. She took her time to repay the money. Ordinarily, both Cameo and Ms Johnson would face a period of disqualification. [10] Ms Johnson submits that I should not disqualify her because there were substantial mitigating factors. She says that she has been in the industry for nine years, has conducted herself professional and ethically in every respect, is of good character and repute and has no previous disciplinary proceedings. Interestingly, Ms Johnson has not provided any evidence from third parties to support her submission that she is of good character and repute. The fact that she has been in the industry for nine years, to me, means that she should have known better. [11] Ms Johnson says that the transactions occurred over a very short period. She says that she had “moments of poor judgment” brought on by extreme stress and naivety. I can accept that a person may have moments of poor judgment once or twice. I do not accept that a person can have moments of poor judgment in June and then again in September. Her assertion that she was naïve is in direct contradiction to her earlier assertion that she has conducted herself professionally and ethically in the industry for nine years. [12] I accept that Ms Johnson is remorseful. I accept that she did not intend to defraud anyone or to deprive any member of the public of trust money. I accept that she has now repaid the money to trust. 2 Section 10(2) PAMDA. 3 Section 10(3)(a)(i) PAMDA. 4 Section 10(3)(a)(ii) PAMDA. 5 Section 10(3)(b)(i) PAMDA. 6 Chief Executive DTFTWID v Cornwell [2005] QCCTPAMD 49 at [10]. -- 3 of 4 -- 4 [13] I accept that Ms Johnson’s only means of earning an income is as a licensee and that she will have difficulty in entering a new industry at her age. That difficulty faces many licensees who are subject to disciplinary proceedings. It is something that they should consider before they engage in inappropriate conduct, not once they face the spotlight of disciplinary proceedings. [14] The Chief Executive has referred me to: a) Chief Executive DTFTWID v Cornwell7; b) Chief Executive DEEDI v Schellaars8; and c) Chief Executive DJAG v DJ Stringer Property Services Pty Ltd and Anor9. [15] The weight of that authority favours a disqualification. The only reason the tribunal did not impose a disqualification in Stringer is that the withdrawals were done by an employee without Mr Stringer’s knowledge. Here, Ms Johnson is solely responsible for her actions. [16] Ms Johnson’s conduct was not as frequent as that of Schellaars and her period of disqualification should reflect that. I accept the Chief Executive’s submission that a disqualification of two years is appropriate. I also note the Chief Executive’s concession that neither Cameo nor Ms Johnson should be fined or ordered to pay costs. [17] The Chief Executive submits that Ms Johnson should be required to undertake a course of study in trust accounts before being permitted to reapply for a licence. I am satisfied that Ms Johnson now understands her onerous obligations in dealing with trust account money. I note that those obligations have been reinforced in a letter from her auditor JMR Group which draws her attention to her responsibilities. I am not persuaded that Ms Johnson needs a course of study to reinforce those obligations. Orders [1] Cameo Property Services Pty Ltd and Margaret Doris Johnson are reprimanded. [2] Cameo Property Services Pty Ltd and Margaret Doris Johnson are disqualified from holding a licence or registration certification under the Property Agents and Motor Dealers Act 2000 for a period of two years. [3] Margaret Doris Johnson is disqualified from being an Executive Officer of a corporation that holds a licence or registration certificate under the Property Agents and Motor Dealers Act 2000 for a period of two years. [4] Cameo Property Services Pty Ltd shall pay $1,074.37 compensation to the Chief Executive Department of Justice and Attorney General by 18 January 2013. 7 [2005] QCCTPAMD 49. 8 [2010] QCAT 477. 9 [2012] QCAT 27. -- 4 of 4 --