Calcraft and Anor v Port Douglas Accommodation Pty Ltd and Ors [2011] QCAT 478

CITATION: Calcraft and Anor v Port Douglas Accommodation Pty Ltd and Ors [2011] QCAT 478 PARTIES: Mr William Joseph Calcraft Mrs Una Imelda Calcraft v Port Douglas Accommodation Pty Ltd Yvonne Hoegger Heinz Hoegger APPLICATION NUMBER: OCL071-11 MATTER TYPE: Other civil dispute matters HEARING DATE: On the papers HEARD AT: Brisbane DECISION OF: Peta Stilgoe, Member DELIVERED ON: 11 October 2011 DELIVERED AT: Brisbane ORDERS MADE: 1. Pursuant to s 488 of the Property Agents and Motor Dealers Act 2000, the claim is allowed in the sum of $19,189.00. 2. Pursuant to s 489 of the Property Agents and Motor Dealers Act 2000, at the expiration of the appeal period, the Chief Executive must pay to Mr and Mrs Calcraft the sum of $19,189.00 from the Claim Fund, and, if there is an appeal, payment must not be made until after the appeal is finally decided. 3. Pursuant to s 488(3)(c) of the Property Agents and Motor Dealers Act 2000, Port Douglas Accommodation Pty Ltd, Yvonne Hoegger and Heinz Hoegger are named as the persons responsible for the financial loss of Mr and Mrs Calcraft. 4. Upon payment from the Claim Fund and pursuant to ss 490 and 530 of the Property Agents and Motor Dealers -- 1 of 4 -- 2 Act 2000, Port Douglas Accommodation Pty Ltd, Yvonne Hoegger, Heinz Hoegger are liable (and if more than one, jointly and severally) to reimburse the Claim Fund by paying the sum of $ 19,189.00 to the Chief Executive, Department of Justice and Attorney General. CATCHWORDS: PAMDA – CLAIM AGAINST THE FUND – where rental payments received into trust – where trust money dispersed to pay creditors of the licensee and without authority – whether claim against the fund – whether director who took no active part in the licensee’s business is a responsible person – whether that person is an executive officer Property Agents and Motor Dealers Act 2000, s 490(2) APPEARANCES and REPRESENTATION (if any): This matter was heard on the papers in accordance with section 32 of the Queensland Civil and Administrative Tribunal Act 2009. REASONS FOR DECISION [1] Mrs Hoegger was a licensed real estate agent who operated Port Douglas Accommodation Pty Ltd. She and her former husband, Heinz Hoegger were directors of that company. Receivers were appointed to the company on 13 January 2010 and Mrs Hoegger has been declared bankrupt. [2] Mr and Mrs Calcraft own two units in Port Douglas, both of which were managed by Mrs Hoegger. Between October and December 2009, the company received rental for the two units but Mr and Mrs Calcraft never received those payments. They have lodged a claim against the claim fund set up under the Property Agents and Motor Dealers Act 2000 for a total amount of $19,189.00. [3] The receiver’s report of September 2010 confirms: a) The company’s receipt of the rent. b) The unauthorised transfer of money from the trust account to the general account to pay the day to day expenses of the company. c) That money held on account of Mr and Mrs Calcraft has not been paid to them. -- 2 of 4 -- 3 [4] The directors have received notice of the claim. Mrs Hoegger has filed submissions which ask that the tribunal not make a finding that Mr Hoegger is a person liable to reimburse the fund. [5] Section 488 of PAMDA sets out the process for deciding the claim. The Tribunal must be satisfied that: a) An event as mentioned in s 470(1) happened; and b) The claimant suffered financial loss because of the event. [6] The Tribunal must also take into account any amount the claimant might reasonably have received or recovered if not for the claimant’s neglect or default1 and any amount ordered to be paid to the claimant as compensation to the claimant under sections 530A, 572D or 592A of the PAMDA2. [7] Finally in allowing a claim the Tribunal must decide the amount of the claimant’s financial loss and name the person who is liable for the loss3. [8] Section 383 of PAMDA provides that an amount paid into a trust account cannot be used for the payment of the debt of a creditor of the licensee. Section 385 of PAMDA states that a licensee may draw funds from trust (relevantly) only if authorised to do so. I am satisfied that the company was in breach of s 383, by paying its creditors from trust money. I am also satisfied that the company is in breach of s 385, by withdrawing trust money without authority. These are both events mentioned in s 470(1). [9] I am also satisfied that Mr and Mrs Calcraft have suffered financial loss because of the event. [10] I am required to name the person who is liable for the loss. If the loss was caused by a corporation, each person who was an executive officer of the corporation at the time of the relevant event is liable to reimburse the fund.4 [11] “Executive officer” is defined in Schedule 2 of PAMDA as: …any person, by whatever named called and whether or not the person is a director of the corporation, who is concerned, or takes part, in the management of the corporation. [12] Mrs Hoegger was knowingly concerned in the management of the corporation. She is liable to reimburse the fund. [13] Prima facie, Mr Hoegger, as director, is also liable to reimburse the fund but Mrs Hoegger says that: a) Her accountant told her that she had to have another person named in the business in case anything happened to her. b) The only person who was able to perform that role was Mr Hoegger. Mrs Hoegger also thought it would be in the best interests of her children to have Mr Hoegger involved. 1 Section 488(2). 2 Section 488(3)(a). 3 Section 488(3)(b) and (c). 4 Section 490(2)(a). -- 3 of 4 -- 4 c) Mr Hoegger has never been involved in the business. He has never received any income from it. He has never received any reports, had access to the accounts or any other information. d) Neither Mrs Hoegger nor Mr Hoegger realised that he was named as a director. [14] A person cannot be made a director to a company without signing a consent to that effect. Mr Hoegger ought to have known that he was a director of the company. Being a director of a company carries obligations to manage the company5. The Corporations Act does not contemplate the role of a silent director who takes no part in the management of the company and thereby avoids obligations to the company and its creditors. [15] I accept the Chief Executive’s argument that the definition of “executive officer” in Schedule 2 of the Act is meant to expand the ambit of s 490(2) liability, rather than exclude directors who might otherwise be covered. While I have some sympathy for Mr Hoegger, he is now one of many people who accept the responsibility of being a director without a consideration of the consequences. He is a person liable to reimburse the fund. Orders [16] Pursuant to s 488 of the Property Agents and Motor Dealers Act 2000, the claim is allowed in the sum of $19,189.00. [17] Pursuant to s 489 of the Property Agents and Motor Dealers Act 2000, at the expiration of the appeal period, the Chief Executive must pay to Mr and Mrs Calcraft the sum of $19,189.00 from the Claim Fund, and, if there is an appeal, payment must not be made until after the appeal is finally decided. [18] Pursuant to s 488(3)(c) of the Property Agents and Motor Dealers Act 2000, Port Douglas Accommodation Pty Ltd, Yvonne Hoegger and Heinz Hoegger are named as the persons responsible for the financial loss of Mr and Mrs Calcraft. [19] Upon payment from the Claim Fund and pursuant to sections 490 and 530 of the Property Agents and Motor Dealers Act 2000, Port Douglas Accommodation Pty Ltd, Yvonne Hoegger, Heinz Hoegger are liable (and if more than one, jointly and severally) to reimburse the Claim Fund by paying the sum of $19,189.00 to the Chief Executive, Department of Justice and Attorney General. 5 Corporations Act 2001 (Cth). s 198A. -- 4 of 4 --