Chief Executive, Department of Justice and Attorney General v Hawash [2012] QCAT 119

CITATION: Chief Executive, Department of Justice and Attorney General v Hawash [2012] QCAT 119 PARTIES: Chief Executive, Department of Justice and Attorney General v Fawzi Nick Hawash APPLICATION NUMBER: OCR276-11 MATTER TYPE: Occupational regulation matters HEARING DATE: On the papers HEARD AT: Brisbane DECISION OF: Peta Stilgoe, Senior Member DELIVERED ON: 21 March 2012 DELIVERED AT: Brisbane ORDERS MADE: 1. Mr Hawash is reprimanded. 2. Mr Hawash may not reapply for a motor dealer’s licence unless and until he has provided the Chief Executive with evidence that he has successfully completed the equivalent of a Certificate IV in Property Services (Real Estate). 3. Mr Hawash shall pay a fine of $7,000 to the Chief Executive on or before 23 October 2012. CATCHWORDS: MOTOR DEALER – where dealer failed to provide all necessary paperwork to buyers – where repeated breaches – where no buyer disadvantaged by breach – penalty Property Agents and Motor Dealers Act 2000, ss 496(1)(g)(iii), 497 Chief Executive DEEDI v Clout [2009] CCT PD010 -09 Chief Executive DJAG v Tomlin PD006 -08 Chief Executive DTRFT v Walker Truck Sales Pty Ltd & Walker [2003] CCT X503 - -- 1 of 5 -- 2 03 & X508 -03 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] Mr Hawash held a motor dealer’s licence from March 2006 to March 2011. He carried on business under the name Marcells Car Centre. [2] On February 2010, the Chief Executive issued three infringement notices to Mr Hawash for: a) Failure to give notice of a statutory warranty. b) Failure to guarantee title to a motor vehicle in an approved form. c) Failing to give the original statement to a buyer prior to the buyer signing a contract. [3] In response to a complaint from a buyer, the Chief Executive conducted further investigations into Mr Hawash’s business. Those investigations revealed that, between February and May 2010, Mr Hawash: a) Failed to issue motor dealers receipts and failed to keep duplicate receipts as required by s 32 of Property Agents and Motor Dealers Regulation 2001. b) On six occasions, did not grant a cooling off period as required, because the documentary requirements were incomplete or incorrect. c) On six occasions failed to ensure that a written contract was provided or, if one was provided, failed to ensure that it complied with the requirements of s 333 of Property Agents and Motor Dealers Act 2000 (“PAMDA”). d) On two occasions, failed to give the approved notice regarding an unwarranted vehicle as required by ss 316, 316A and 317 of PAMDA. e) On ten occasions, failed to give a security interest certificate on the day the property was passed to the buyer, as required by s 295(4) of PAMDA. f) On two occasions, failed to provide, in the approved form, confirmation of clear title to the buyer. g) On eleven occasions, failed to provide statutory warranty notices in the approved form prior to purchase as required by s 317 of PAMDA. In seven of those cases, the notices that did issue were incorrect or not signed by the buyer. h) On twelve occasions, Mr Hawash had not entered the prescribed particulars into his transaction register as required under s 330 of PAMDA within the required period. -- 2 of 5 -- 3 [4] The Chief Executive’s investigations were based upon a sample of transactions during the period. [5] The Chief Executive has referred Mr Hawash to the tribunal for disciplinary proceedings under s 497 of PAMDA on the basis that, pursuant to s 496(1)(g)(iii), Mr Hawash has been incompetent or acted in an unprofessional way. [6] Mr Hawash does not dispute the facts giving rise to the referral but he does dispute the Chief Executive’s assertion that he has been unprofessional. He concedes that his attention to documentation requirements was “less than satisfactory”. [7] I have considered the material filed in these proceedings and I am satisfied that the grounds for disciplinary action are substantiated. I turn, then, to the question of penalty. [8] The Chief Executive asks that Mr Hawash be reprimanded, fined $2,000 and prohibited from holding a licence, or being an executive officer of a company that holds a licence, for a period of two years. In support of that submission, the Chief Executive says: a) Mr Hawash was a “not inexperienced” dealer. b) In previous compliance checks, Mr Hawash was fully compliant. c) Mr Hawash was fully aware of his obligations. d) The conduct occurred after Mr Hawash had been issued with infringement notices. e) Mr Hawash’s buyers were people from Torres Strait or Cape York who may have had difficulty in understanding their rights and enforcing them if there was a problem. f) The cars the subject of these proceedings were old, high mileage cars that will suffer more mechanical difficulties given the remote locations in which they will operate. It is, therefore, critical that consumers are fully informed of their rights through full compliance with the legislation. g) Mr Hawash was cooperative with the Chief Executive’s investigations. [9] Mr Hawash asks the tribunal to take no action as: a) He has only ever received one customer complaint. b) His “errant” documentation has never negated a sale or put ownership at risk and he has always honoured warranty claims. c) In May 2009, most of his stock was written off due to vandalism. He relocated the business and merged it with a mechanical repair shop but the restructure was not successful. d) His paperwork was consistently compliant until he moved the business to another address and tried to manage both the car sales and a mechanical repair shop. -- 3 of 5 -- 4 [10] The Chief Executive has referred me to three comparative cases. In Chief Executive DEEDI v Clout1 the dealer promised to pay stamp duty and registration costs but failed to do so. In three cases, the buyers recovered their stamp duty and registration costs from the statutory fund. The dealer’s business was failing at the time. The learned Member was not satisfied that the dealer had been actively dishonestly. The dealer was disqualified for two years and ordered to pay a fine of $750. [11] In Chief Executive DJAG v Tomlin2 the dealer sold one car in circumstances where most of the required paperwork was missing. The dealer also failed to honour the statutory warranty, causing the buyer $1,000 loss and damage. The dealer had not previously been subject to proceedings before the tribunal. His licence was cancelled for two years, he was ordered to pay the buyer compensation and he was ordered to pay a fine of $750. The order was made by consent; there are no reasons from the tribunal which assist me in making my decision. [12] Chief Executive DTRFT v Walker Truck Sales Pty Ltd & Walker3 involved a motor dealer not using the appropriate form for consignment sales. In two cases, he did not immediately pay the proceeds of sale into trust. The dealer had no previous disciplinary history but admitted he was not fully aware of his obligations. The tribunal imposed a fine of $5,250 and the dealer was ordered to undertake a business management course. [13] Factors to consider when imposing a penalty include: the protection of consumers; prevention of a repetition of the offence; the dealer’s blameworthiness; and the harm to the industry as a whole. [14] The evidence available to me indicates that no consumers have been harmed by Mr Hawash’s failure to comply with the requirements of PAMDA. I note the Chief Executive’s argument that, because Mr Hawash was dealing with members of the indigenous community, he was less likely to receive complaints. There is no evidence to support that argument and I am disinclined to rely on a statement made by an investigating officer in the course of an interview unless there is some support for that statement. The Chief Executive was aware of at least one complaint from that community and had officers in the area who may have been able to make further inquiries. The absence of any further complaints supports Mr Hawash’s argument that no consumers suffered any loss through his actions. [15] I do not accept that Mr Hawash was unaware of his obligations under PAMDA. He had operated a business since 2007 without coming to the attention of the Chief Executive. It is unlikely that he survived that period without scrutiny simply by chance or good luck. The more likely explanation is that financial pressures and the task of trying to run two businesses was too much for Mr Hawash and he simply lost his ability to attend to detail. [16] I also accept that Mr Hawash cooperated with the Chief Executive and has admitted the offending behaviour occurred. While this should operate to 1 [2009] CCT PD010-09. 2 PD006-08. 3 [2003] CCT X503-03 and X508-03. -- 4 of 5 -- 5 mitigate any penalty, I am also mindful of the fact that Mr Hawash’s breaches were numerous and extended over a period of some months. [17] On balance, I am not persuaded that Mr Hawash should be excluded from holding a licence for a period of two years. He has not held a licence since March 2011 but he does, apparently, intend to act as a dealer in the future. The industry and future consumers will be well protected by me imposing a condition that Mr Hawash may not reapply for a licence unless and until he has provided the Chief Executive with evidence that he has successfully completed the equivalent of a Certificate IV in Property Services (Real Estate). [18] Mr Hawash should also pay a fine. The learned Member in Chief Executive DTRFT v Walker Truck Sales Pty Ltd & Walker imposed a fine of 70 penalty units. On today’s scale, that would equate to a penalty of $7,000. I am mindful that Mr Hawash is already repaying the infringement notices through SPER and a fine of this size will be a burden to him. However, any fine must act as a deterrent to both Mr Hawash and the industry at large and I have not deprived Mr Hawash of his ability to return to work as a motor dealer. Mr Hawash engaged in more breaches over a longer period than Mr Walker. I can find no good reason to reduce the penalty from that imposed in Chief Executive DTRFT v Walker Truck Sales Pty Ltd & Walker. Orders [1] Mr Hawash is reprimanded. [2] Mr Hawash may not reapply for a motor dealer’s licence unless and until he has provided the Chief Executive with evidence that he has successfully completed the equivalent of a Certificate IV in Property Services (Real Estate). [3] Mr Hawash shall pay a fine of $7,000 to the Chief Executive on or before 23 October 2012. -- 5 of 5 --