AVS Group Australia Pty Limited v Commissioner of Police, NSW Police Force

SECOND APPLICANT Tony Sleiman

RESPONDENT Commissioner of Police, NSW Police Force Representation: Counsel K Oliver, (Applicants) T Lynch (Respondent) M Higgins (counsel assisting the Tribunal) AJL Legal (Applicants) Crown Solicitor's Office (Respondent) R McIlwaine and S Schaudin, Legal Representation Office (counsel assisting the Tribunal) File Number(s): 093202, 093216 Publication restriction: Section 75(2) of the Administrative Decisions Tribunal Act 1997 applies to those paragraphs of these reasons identified as [not for publication]. Those paragraphs are not to be released to either the Applicants or to the public

REasons for decision 1GENERAL DIVISION (S MONTGOMERY, (JUDICIAL MEMBER)): These applications relate to determinations by the Commissioner of Police ("the Commissioner") to cancel licences held by the applicants under the Security Industry Act 1997 ("the Act"). 2In these reasons I will refer to Mr Tony Sleiman as 'Tony' and Mr Peter Sleiman as 'Peter'. No disrespect is intended by referring to these individuals by their first names. I will refer to matter No. 093202 as 'the Peter Sleiman matter'. Matter No. 093216 is referred to as 'the Tony Sleiman matter'. 3Tony is the sole director and shareholder of AVS Group Australia Pty Ltd ("AVS GA"). A master security licence was issued to Tony in respect of AVS GA. 4Peter is the licensee in respect of AVS Group of Companies Pty Ltd ("AVS GC") and a disclosed close associate of ASET Security and Training Pty Ltd.

Background 5The background to the applications is set out in the Appeal Panel decision in AVS Group of Companies Pty Ltd v Commissioner of Police, NSW Police Force (GD) [2010] NSWADTAP 61 as follows: "8 On 23 July 2009 the Commissioner of Police served a notice of revocation on Mr Peter Sleiman revoking his personal licence held under [the Act], Class 1ABC Class 2ABD, and the Master Licences held by the two companies for which he is the nominated person, AVS Group of Companies Pty Ltd and ASET Security and Training Pty Ltd, numbers 4084999079 & 408981164. 9 On 13 August 2009 the Commissioner of Police served a notice of revocation on Mr Tony Sleiman as the nominated person revoking the Master Licence issued in the name of AVS Group Australia Pty Ltd. 10 In both cases service was effected at the common business address for the above businesses, 88 Parramatta Rd, Granville. Contents of Notices of Revocation 11 The 23 July 2009 notice of revocation gave as grounds for revocation that Peter was no longer a fit and proper person to hold a security licence (referring to section 26(1A) read in combination with section 15(1)(a) of the SI Act) and was not in the public interest (not referring to any provisions, but the relevant provisions are section 26(1A) read in combination with section 15(3)). 12 The body of the notice made no further reference to the public interest ground. It confined itself to the fitness ground. It begins with words: 'For the purposes of Section 26(1A) and Section 15(1)(a) of the Act, Section 15(6) provides; and then set out the words of the sub-section which are as follows: (6) For the purpose of determining whether an applicant is a fit and proper person to hold the class of licence sought by the applicant, the Commissioner may have regard to any criminal intelligence report or other criminal information held in relation to the applicant that: (a) is relevant to the activities carried out under the class of licence sought by the applicant, or (b) causes the Commissioner to conclude that improper conduct is likely to occur if the applicant were granted the licence, or (c) causes the Commissioner not to have confidence that improper conduct will not occur if the applicant were granted the licence. 13 The 13 August 2009 notice gave as the grounds for revocation that Tony had contravened a condition of a licence being failure to disclose particulars of a close associate, Peter Sleiman, that a close associate of AVS Group Australia Pty Ltd is not a fit and proper person to hold a licence (Peter Sleiman) and that it is not in the public interest that Tony hold a licence. Section 26(1)(b)(iii) provides that contravention of a condition is a ground for revocation. 14 The body of the notice was fuller than in the case of the Peter notice. It started off with the same material as in the Peter notice relating to the fitness ground, quoting section 15(6) and then went on to state: Section 15(7) of the Act states that the Commissioner is not, under this or any other law, required to give any reasons for not granting a licence if the giving of those reasons would disclose the existence or content of any criminal intelligence report or other criminal information as referred to in subsection (6). Section 15(5) of the Security Industry Act 1997 prescribes that except as provided by the regulations, reference in this section to an applicant includes, in the case of an application for a master licence, a reference to each close associate of the applicant. Section 26(1)(d) of the Security Industry Act 1997 prescribes that a licence may be revoked for any other reason prescribed by the regulations. Clause 29 of the Security Industry Regulation 2007 provides that a licence may be revoked if the Commissioner considers that it is not in the public interest for the person to whom it was granted to continue to hold it. 15 The notice then gave information as to the licensee's rights to apply for review by the Tribunal. 16 [The Commissioner has indicated in the course of these proceedings that the 'public interest' grounds in each of the decisions is no longer pressed. ...] 17 In respect of the 'Peter Sleiman' revocations, the affected persons filed an application for review by the Tribunal on 30 July 2009. In the 'Tony Sleiman' case the affected party filed an application for review on 13 August 2009. As already noted, on 13 August 2009 stays were granted, the context further explained below. 6The Appeal Panel also set out a litigation history of the proceedings that included what the Appeal Panel referred to as " a welter of interlocutory appeal activity". Since the time of that decision there have been a number of further interlocutory appeals, applications to the Supreme Court and Court of Appeal and an application for special leave to the High Court. 7In Commissioner of Police v Sleiman & AVS Group of Companies Pty Ltd & Ors [2011] NSWCA 21 the Court of Appeal considered the proposal that the Tribunal adopt a "special advocate" procedure to independently assess the confidential material. Following on from the Court of Appeal's consideration of that issue, the Tribunal has had the benefit of Mr Higgins in the role of counsel assisting in these proceedings and the support of Mr McIlwaine and Mr Schaudin from Legal Representation Office. 8Section 75(1) of the Administrative Decisions Tribunal Act 1997 ("the ADT Act") provides that proceedings of the Tribunal are to be conducted in public, but sub-section (2) then makes provision in relation to closed hearings and the Tribunal's powers to restrict the disclosure, and publication, of evidence and materials before it. It provides: (2) However, if the Tribunal is satisfied that it is desirable to do so by reason of the confidential nature of any evidence or matter or for any other reason, it may (of its own motion or on the application of a party) make any one or more of the following orders: (a) an order that the hearing be conducted wholly or partly in private, (b) an order prohibiting or restricting: (i) the disclosure of the name, address, picture or any other material that identifies, or may lead to the identification of, any person (whether or not a party to proceedings before the Tribunal or a witness summoned by, or appearing before, the Tribunal), or (ii) the doing of any other thing that identifies, or may lead to the identification of, any such person, (b1) an order prohibiting or restricting the publication or broadcast of any report of proceedings before the Tribunal, (c) an order prohibiting or restricting the publication of evidence given before the Tribunal, whether in public or in private, or of matters contained in documents lodged with the Tribunal or received in evidence by the Tribunal, (d) an order prohibiting or restricting the disclosure to some or all of the parties to the proceedings of evidence given before the Tribunal, or of the contents of a document lodged with the Tribunal or received in evidence by the Tribunal, in relation to the proceedings. ... 9The licences held by AVS GC and by Peter were revoked by the Commissioner pursuant to section 26 (1A) of the Act. The Notice of Revocation gave as it reasons for the revocation of the licence that the holder was no longer a fit and proper person for the purposes of holding a licence under the Act. The Notice of Revocation is under review in these proceedings. 10Section 26 of the Act provides: 26 Revocation of licence (1) A licence may be revoked: (a) (Repealed) (b) if the licensee: (i) supplied information that was (to the licensee's knowledge) false or misleading in a material particular in, or in connection with, the application for the licence, or (ii) contravenes any provision of this Act or the regulations, whether or not the licensee has been convicted of an offence for the contravention, or (iii) contravenes any condition of the licence, or (c) (Repealed) (d) for any other reason prescribed by the regulations. (1A) The Commissioner must revoke a licence where the Commissioner is satisfied that, if the licensee were applying for a new licence, the application would be required by this Act to be refused. ...

Issues 11The substantive issue is whether the Commissioner's decision to revoke the various licences should be varied, set aside or confirmed. This requires consideration of a number of issues but primarily the issue of whether Peter is a close associate of Tony and AVS GA; and if so, whether Peter is a fit and proper person to hold a licence under the Act. 12Section 63 of the ADT Act says that in determining an application for review the Tribunal is to make the correct and preferable decision having regard to the material before it, and any applicable written or unwritten law. It is well established that in considering an application for review the Tribunal is not constrained to have regard only to the material that was before the Commissioner, but may have regard to any relevant material before it at the time of the review: Drake v Minister for Immigration and Ethnic Affairs (1979) 46 FLR 409. Re Repatriation Commission and McCartney (1986) 9 ALD 441 at 449; Turner v minister for Immigration and Ethnic Affairs (1981) 35 ALR 388 at 390

Onus Of Proof 13Section 29 of the Act permits an application to the Tribunal for review a decision in relation to a licence under the Act. There is no provision in the Act for the onus of proof in such a review. Whilst Part 2 of Chapter 6 of ADT Act empowers the ADT to determine its own procedure, it is silent as to the onus of proof in an application for review. Accordingly, it is appropriate to consider the administrative context in which the provisions of the Act operate, and the issues relevant to the review of the Commissioner's decision. 14Whilst it is clear that the Tribunal can determine its own procedure, and undertake its own inquiries if so minded, the reference to "receive evidence and hear argument" in section 29 (3)(b) contemplates the Tribunal will conduct a hearing in which the Commissioner will seek to sustain the revocation. 15The administrative context is whether circumstances existed to justify the cancellation of the licence. In the Tony Sleiman matter those circumstances concern the alleged breach of a condition of the licence, namely the failure by Tony to disclose a close association with Peter during the period of the master licence revoked, and whether Peter was, in fact, a close associate of Tony. In the Peter Sleiman matter the circumstances are those that the commissioner would consider justify a refusal to renew a licence of a notional applicant as bearing directly upon the fitness and propriety to hold a class of licence under the Act. It is implicit in this that the Commissioner holds material that contains information directly concerning the conduct of Peter and AVS GC. 16The Applicants in the Tony Sleiman matter submit that the Commissioner bears the onus of proving the breach of the condition of the licence and that Peter was in fact a close associate of Tony. The Applicants in the Peter Sleiman matter submit that the Commissioner bears the onus of proving that Peter is not a fit and proper person to hold the licence. 17They submit that if the review is characterized as analogous to that in a breach of discipline matter, the onus of proving such a breach lies on the party alleging the breach. The Applicants cited the decision of Beaumont J in Minister for Health v Thomson (1985) 8 FCR 213 in which his Honour quoted with approval Professor Campbell's explanation of legal burdens of proof: " ... where the issue to be decided is whether circumstances have arisen which would justify cancellation or suspension of a licence ... the onus of proving that these circumstances have arisen would devolve on the accuser." 18The view of Beaumont J. in Minister for Health v Thomson was cited with approval by Hill J in Casarotto v Australian Postal Commission (1989) 86 ALR 399 at 412-413. 19In Re Appeals of Johnson and Anderson [1967] 2 NSWLR 357 the Court was concerned with two statutory appeals from the decisions of the Medical Disciplinary Tribunal where both appellants were found guilty in the original Tribunal of infamous conduct. Both appeals were hearings de novo. Whilst the court accepted that the appellants had an appellant's onus to show that the decision appealed was wrong, the appellant discharged the onus by showing that the complainant in the original proceedings had not discharged its onus. 20In Secretary, Department of Social Security v Willee and Others (1990) 96 ALR 211 per Foster J, the Federal Court was concerned with an application for review of a decision of a disciplinary appeals committee to vary the decision of the applicant to the Federal Court substituting dismissal of the second respondent with a monetary penalty. The applicant sought an order of review on the ground that the committee had regarded the applicant as bearing an onus of justifying the decision. The argument of the applicant that the committee fell into error by treating the second respondent's appeal to the committee on the basis that the onus lay on the applicant to justify the decision was rejected. Foster J rejected the general proposition that the concept of an ultimate onus of proof being inappropriate to proceedings before an administrative tribunal where that tribunal is to determine disciplinary proceedings. At page 220 Foster J stated: "In such circumstances, common fairness would require the casting of the customary onus upon the prosecution to prove its case. Such a situation is, in my opinion, significantly different from one where an inquiry or investigation of an administrative character is being undertaken ... Generally speaking, concepts of onus of proof used in adversary proceedings are inapplicable in administrative proceedings in the social security area ... However, where, as here, a breach of discipline or something analogous is alleged, the onus of proving such a breach of lies upon the accuser." 21In contrast to the view expressed by Beaumont J in Thompson , Fox J stated: "I do not think it useful, and it may be misleading, to talk in terms of onus of proof in relation to proceedings such as those with which the Committee was concerned. The Committee was one of inquiry, and it was inquiring into the services charged by one doctor. It was obliged to find the facts, so far as it could do so, concerning those services. There were not multiple parties to the inquiry. The process at the hearing was one in which documentary evidence was formally laid before it by its Secretary and thereafter Dr. Thomson gave evidence and was questioned at length by members of the Committee. No other evidence was called. To talk of onus of proof, in its legal sense, is in my view inappropriate (cf. McDonald v. Director-General of Social Security [1984] FCA 57; (1984) 1 F.C.R. 354)." 22The Commissioner submits that there is disagreement in Thompson . He argues that neither party bears a legal onus of proof in the Tribunal unless the legislation governing the decision under review provides to the contrary. 23The Administrative Appeals Tribunal considered the various authorities in VBN and Ors and Australian Prudential Regulation Authority and Anor [2006] AATA 710; (2006) 92 ALD 259. APRA disqualified seven directors of a staff superannuation fund trustee. All were disqualified under section 120A(2) of the contravened the Superannuation Industry (Supervision) Act 1993 ("the SIS Act") on the basis that they were directors at times when the trustee entity allegedly contravened sections 52(2)(b), (c) and (g) of the SIS Act and that those contraventions were of such nature and seriousness as to justify their disqualification. The AAT decided that the Trustee had not contravened the SIS Act and with regard to all seven of the directors, that there is no power to disqualify them under section 120A(2). The tribunal set aside each of APRA's decisions on that basis. However, with regard to the remaining two, VBW and VBN, APRA also based its decisions on their not being fit and proper persons to be responsible officers of the trustee. This entitled the regulator to disqualify a person not considered a fit and proper person. In considering the general principles of the manner in which the case was presented, the tribunal was asked to consider setting aside the decision of APRA in the absence of being affirmatively satisfied whether the Trustee has contravened the Act and whether a person is a fit and proper person to be a responsible officer of the Trustee. In considering the submissions to set aside the decision of APRA the Tribunal considered a number of authorities: 230. The Trustee and the Applicants submitted that, unless the Tribunal is affirmatively satisfied of the relevant matters in s 120A, it is bound to set aside APRA 's decisions. They relied on a passage from the judgment of Woodward J in McDonald v Director -General of Social Security : [(1984) 1 FCR 354; 6 ALD 6] "If the AAT finds itself in a state of uncertainty after considering all the available material, unable to decide a question of fact either way on the balance of probabilities, it will be necessary to analyse carefully the decision it is reviewing. If, for example, it is a decision whether or not to cancel a pension in the light of changed circumstances, then it has failed to achieve the statutory requirement of reaching a state of mind. ..."[ [1984] FCA 57; (1984) 1 FCR 354; 6 ALD 6 at 358; 11] 231. They relied too on a passage from the judgment of Beaumont J in Minister for Health v Thomson [(1985) 8 FCR 213; 60 ALR 701] when he said: "Generally speaking, concepts of onus of proof used in adversary proceedings are inapplicable in administrative proceedings in the social security area: (see McDonald v Director -General of Social Security ) ... However, where, as here, a breach of discipline, or something analogous, is alleged, the onus of proving such a breach lies upon the accuser. ..."[ [1985] FCA 208; (1985) 8 FCR 213; 60 ALR 701 at 223; 712] 232. This passage was approved by Hill J in Casarotto v Australian Postal Commission [[1989] FCA 116; (1989) 86 ALR 399; 17 ALD 321 at 412-413, 334-335] when he said that "It may be that what was said by Woodward J in McDonald should be confined to the context of social security legislation." [[1989] FCA 116; (1989) 86 ALR 399; 17 ALD 321 at 412, 334] In Secretary, Department of Social Security v Willee [(1990) 96 ALR 211; 20 ALD 557] Foster J also approved the passage. In the case before him, he would have found no error had a disciplinary committee proceeded on the basis that the Secretary bore the general onus of establishing the breach it had charged [[1990] FCA 221; (1990) 96 ALR 211; 20 ALD 557 at 221, 560] His Honour said: "... In my opinion, in a de novo hearing, the person in the position of prosecutor bears the overall onus of establishing not only the offence but also all the facts upon which he seeks to rely for the grounding of a penalty of a particular nature. ..." [[1990] FCA 221; (1990) 96 ALR 211; 20 ALD 557 at 221, 560] 233. No mention was made in any of these cases of the judgment of Fox J in Minister for Health v Thomson ... 234. The Trustee and the Applicants referred also to two earlier High Court cases. The second of those cases was Unity Insurance Brokers Pty Ltd v Rocco Pezzano Pty Ltd [[1998] HCA 38; (1998) 192 CLR 603; 154 ALR 361]. It concerned proceedings originally taken in the Supreme Court of Western Australia under the Insurance Contracts Act 1984. It does not relate to merits review. The first does concern merits review. It is The Commonwealth v Muratore [(1978) 141 CLR 296; 22 ALR 176] in which the High Court considered an application for judicial review of a determination made under the Compensation (Commonwealth Employees) Act 1971. Jacobs J, with whom Gibbs, Stephen and Aickin JJ agreed, said of allegations made by the Commonwealth that an employee is either physically able to earn in some suitable employment an amount not less than that employee's former weekly pay at the date of injury or is not physically incapacitated for work: "... In both situations the Commonwealth is, or would be, alleging that the circumstances of the employee had changed; and the onus lies upon the party alleging the change of circumstances to prove it. The position is quire [sic] different if there has been no previous finding of partial incapacity with a consequent assessment of the compensation payable. It is established that the employee then bears the onus of proving the partial incapacity for work and its reflection in the degree of his ability to earn ..." [[1978] HCA 47; (1978) 141 CLR 296; 22 ALR 176 at 302, 180] 235. The submission made by the Trustee and the Applicants gives us the impression that it is underpinned by notions of a legal burden or onus of proof. If that is so, we cannot accept it for none of the cases goes so far. In the first instance, neither party bears a legal onus of proof in the Tribunal unless the legislation governing the decision under review provides to the contrary. That was made clear by Woodward J in McDonald v Director -General of Social Services . This is not contradicted by the subsequent cases and, in particular, is not contradicted by Beaumont J's judgment in Minister for Health v Thomson . His Honour was speaking of the practical reality that the party wanting to change the status quo must ensure that the relevant evidence is brought to the Tribunal to consider. The party may introduce the evidence, may draw it out in cross-examination of the other party's witnesses or trust that the other party will produce it. 24Whilst I accept that there is disagreement in Thompson as to the allocation of the onus of proof, it is significant to me that the Commissioner is alleging a change of circumstance. I consider that the onus lies upon the party alleging that change of circumstance to prove it. It is also significant that the Commissioner is alleging that he has material directly concerning Peter and AVS GC which he contends justifies revoking the licences. I consider the onus lies upon the party alleging that such conduct has occurred or circumstances exist to prove it. Accordingly, I consider that the Commissioner has the onus of proof to establish to the requisite standard that: 1.Peter was a "close associate"; 2.Tony failed to disclose that Peter was a "close associate"; That the failure to do so was a breach of a condition of the licence; 4.Peter and AVS GC are no longer fit and proper persons for the purposes of holding a licence under the Act.

Reasons for refusing applications dated 6 April 2011 25On 6 April 2011 counsel for the Applicants made several applications arising out of the Tribunal's ruling on 31 March 2011 disallowing a question asked of Mr Cameron Smith in cross-examination. The Applicants sought the following: (a)request, not pursuant to s 89 of the ADT Act, but pursuant to s 73(4)(b) of the ADT Act, that the Tribunal explain to them its reasons for disallowing the proposed line of questioning; (b)renew their application, pursuant to s 58(2) of the ADT Act, for a direction that they be given a copy of so much of the statement of reasons lodged with the Tribunal pursuant to s 58(1)(b) of the ADT Act as consists only of the Commissioner's statement of reasons for satisfaction that a condition of the relevant master licence has been breached by failure to disclose particulars of Peter Sleiman as a close associate; (c)apply, pursuant to s 84(1)(b) of the ADT Act, for a direction that the Registrar issue a summons to the Commissioner of Police to attend and produce (on a date to be determined by the Tribunal) copies of every database entry, and of any other "document" (as defined in the Dictionary to the Evidence Act 1995) whatsoever in his possession, or under his control, being or evidencing material to which the Commissioner, or his delegate, had regard in determining whether he was satisfied that a condition of security master licence number 409404756 had been contravened by reason of failure to disclose particulars of a "close associate"; and (d)request, pursuant to s 73(4)(b) of the ADT Act, that, if the Tribunal refuses any or all of the foregoing requests and/or applications, the Tribunal explain in each case its reasons for such refusal. 26I refused to grant the orders sought in items (a), (b) and (c) of that application. 27[Not for publication]

The Issue of Close Association 28The Commissioner's notice of revocation alleges that Peter is a "close associate" of AVS GA. The Commissioner also contends that Peter is a "close associate" of Tony. This latter contention does not appear in the Notice of Revocation. The Commissioner contends that there is an undisclosed association, impacting upon Tony as a fit and proper person. 29As noted above, section 15(5) of the Act provides: (5) Except as provided by the regulations, a reference in this section to an applicant includes, in the case of an application for a master licence, a reference to each close associate of the applicant. 30The meaning of the expression "close associate" is set out in section 5 of the Act as follows: 5 Meaning of "close associate" (1) For the purposes of this Act, a person is a close associate of an applicant for, or the holder of, a licence if the person: (a) holds or will hold any relevant financial interest, or is or will be entitled to exercise any relevant power (whether in his or her own right or on behalf of any other person), in the business of the licence applicant or holder, and by virtue of that interest or power is or will be able (in the opinion of the Commissioner) to exercise a significant influence over or with respect to the conduct of that business, or (b) holds or will hold any relevant position, whether in his or her own right or on behalf of any other person, in the business of the licence applicant or holder. (2) In this section: relevant financial interest in relation to a business means: (a) any share in the capital of the business, or (b) any entitlement to receive any income derived from the business, whether the entitlement arises at law or in equity or otherwise. relevant position means the position of director, manager, and other executive positions and secretary, however those positions are designated, and such other positions as may be prescribed by the regulations for the purposes of this definition. relevant power means any power, whether exercisable by voting or otherwise and whether exercisable alone or in association with others: (a) to participate in any directorial, managerial or executive decision, or (b) to elect or appoint any person to any relevant position. 31The Commissioner must satisfy the Tribunal that: (a)Peter is, or will be, able to exercise a significant influence over the conduct of the security business of AVS GA, and (b)that significant influence is, or will be exercised as a result of: (i)Peter holding or will hold a relevant financial interest in the business of AVS GA; or (ii)Peter being entitled, or that he will be entitled, to exercise any relevant power in the business of AVS GA; or (c)Peter holds, or will hold a relevant position in AVS GA business (in which case the ability to exercise a significant influence need not be established).

Construction of section 15(6) of the Act 32Section 15(6) of the Act authorises the Commissioner to have regard to any criminal intelligence report or other criminal information that is "held in relation to the applicant" whose security licence is in issue, for the purpose of determining whether the relevant applicant is a fit and proper person to hold the class of licence sought. 33Section 29(3) of the Act provides: 29 Right to seek review from Administrative Decisions Tribunal ... (3) In determining an application for a review of any decision to refuse to grant a licence or to revoke a licence that was made on the ground of the applicant not being a fit and proper person, the Administrative Decisions Tribunal: (a) is to ensure that it does not, in the reasons for its decision or otherwise, disclose the existence or content of any criminal intelligence report or other criminal information referred to in section 15 (6) without the approval of the Commissioner, and (b) in order to prevent the disclosure of any such report or other criminal information, is to receive evidence and hear argument in the absence of the public, the applicant for review, the applicant's representative and any other interested party, unless the Commissioner approves otherwise. ...

Criminal intelligence report or other criminal information 34The expressions "criminal intelligence report" and "other criminal information" are not defined in the Act. There has been no judicial determination of whether a particular item of data is or is not a criminal intelligence report or other criminal information. However there has been some judicial consideration of that phrase: see for example Commissioner of Police v Gray 74 NSWLR 1 (" Gray "); AVS Group Of Companies Pty Ltd v Commissioner Of Police [2010] NSWCA 81 (" AVS C/A (No. 1) "). 35The Applicants submit that for the purposes of section 15(6) of the Act, the expression "criminal intelligence report" denotes:

• a report;
• by a professional intelligence agent acting in that capacity;
• of actual or suspected organised criminal activity;
• that the law obliges, or at least entitles, the Commissioner to refrain from disclosing. 36The Applicants further submit that the expression "other criminal information" denotes:
• information other than a criminal intelligence report;
• about actual or alleged criminal conduct by the person in relation to whom it is held;
• obtained from any source and in any form;
• that the law obliges, or at least entitles, the Commissioner to refrain from disclosing. 37It is also submitted that in order to constitute any "criminal intelligence report or other criminal information" that is referred to in section 15(6), the further elements of that subsection must be satisfied. It must be held "in relation to the applicant" and it must be "relevant to the activities carried out under the class of licence sought". 38The Commissioner submits that 'reports and Information' should be read as a single concept, viz any information about or relating to criminal activity, rather than as a statement of distinct categories of such information. Support for that submission is found in AVS C/A (No. 1) at [169] where Campbell JA referred to "section 15(6) information". 39He contends that the overlap in the phrase reflects an attempt to ensure that no category of information concerning criminal activities the circumstances in which criminal activities can arise and the identity of those involved and their associates was deprived of either probative utility for the purposes of section 15(6) or 15(7) and section 29(3) protection. 40The rationale for the construction urged by the Commissioner is that the object of sections 15(7) and 29(3) is that an applicant for a licence or review of a decision should not know about the existence or content of the police information holdings, that the Commissioner has about the applicant, notwithstanding that such holdings were a reason for a decision that is adverse to the applicant, unless the Commissioner otherwise approves. He submits that nothing in the context of the Act generally suggests any narrower meaning and that a construction of 'reports and Information' that deprive some subset of information about or relating to criminal activity of section 15(6) use or sections 15(7) and 29(3) protection would not advance that statutory purpose. 41The Commissioner refers to the reference in Gray at paragraph [16] that '[t]he Commissioner urges a broad approach to the interpretation of [what is section 15(6)] material ..., as this would promote the objects of the Act, by ensuring the protection of police information holding and ensure that only persons of utmost integrity are granted [or hold] a licence...". The Commissioner then submits that there is nothing in the subsequent decisions AVS C/A (No. 1) or Commissioner of Police v Sleiman & AVS Group of Companies Pty Ltd & Ors [2011] NSWCA 21 (" AVS C/A (No. 2) ") to suggest such a "broad approach" is wrong. Indeed the reasons in those decisions each suggest the submission was correct. 42The Commissioner's view must be considered in light of the fact that the Act confers coercive powers on the Commissioner and generally should be construed restrictively. I am conscious of the views expressed in FCT v Citibank Ltd (1989) 20 FCR 404 at 433; 85 ALR 588 at 614-15, where French J adverted to the interrelationship between the presumptions of common law rights and the will of the legislature: The nature of this society, and its tradition of respect for individual freedoms, will support an approach to construction which requires close scrutiny and a strict reading of statutes which would otherwise remove or encroach upon those freedoms. But where the natural meaning of the words is clear, the will of Parliament must be respected. 43However, in my view the close scrutiny and strict reading of the statute supports the Commissioner's submission that a broad approach to the construction of the expression "criminal intelligence report and other criminal information" is necessary to promote the objects of the Act. Nevertheless, in my view the Applicants have correctly identified the separation between the concepts of "criminal intelligence report" and "other criminal information". One informs the other. For example, information might be gathered from a number of sources which appear to be unrelated but which take on a different character and greater significance when analysed and brought together in a report. 44If a broad approach is adopted in regard to the meaning of the expression 'criminal information', the purpose to which the Commissioner refers is met. 45I agree with the Commissioner that the expression includes information about the following: (1)criminal activity, (2)the circumstances in which criminal activity may occur or has occurred, (3)the identity of those involved in criminal activity, (4)the identity of those with whom the individuals involved in criminal activity associate. 46I also agree with the Applicants that the further elements of that subsection must be satisfied. The criminal intelligence report and other criminal information must be held "in relation to the applicant" and it must be "relevant to the activities carried out under the class of licence sought". Whether it is so held is an objective question for the Tribunal to determine: Gray at paragraph [96]. For the reasons argued by the Commissioner, it is also my view that a broad approach should be taken to the construction of those expressions. 47In the remainder of these reasons, unless the context requires otherwise, I will refer to 'criminal intelligence report or other criminal information' collectively as 'section 15(6) material'.

The Applicants' submission 48The Applicants contend that neither the Commissioner, nor the Tribunal, is authorised to have regard to any section 15(6) material for any purpose other than "determining whether the applicant is a fit and proper person" to hold a relevant class of licence. It is submitted that neither the Commissioner, nor the Tribunal, has authority to have regard to section 15(6) material for the purpose of determining generally whether a security licence should be granted or refused. Therefore, so long as the existence of the alleged close association remains to be determined, use of any section 15(6) material for the purpose of determining its existence would neither be, nor be deemed to be, use "for the purpose of determining whether an applicant is a fit and proper person" and hence would not be authorised by section 15(6). 49It is further submitted that the section confers such authority only for the purpose of determining a specific question, which, if determined adversely to an applicant, is a mandatory ground for refusal. In support of that submission the Applicants rely on views expressed in Anthony Hordern & Sons Ltd v Amalgamated Clothing and Allied Trades Union of Australia (1932) 47 CLR 1 at 7.7 per Gavan Duffy CJ & Dixon J: "When the legislature explicitly gives a power by a particular provision which prescribes the mode in which it shall be exercised and the conditions and restrictions which must be observed, it excludes the operation of general expressions in the same instrument which might otherwise have been relied upon for the same power". 50Whether the Anthony Hordern principle applies "[i]n every case ... will depend on the precise character of the relevant provisions and on the context in which they are found": Leon Fink Holdings Pty Ltd v Australian Film Commission (1979) 141 CLR 672 at 680 per Mason J. 51The Applicants contend that in the present case, the purposive limitation on the function that section 15(6) confers must be construed in the relevant context of sections 15(7) and 29(3) of the Act. It is submitted that this leads to the construction that section 15(6) material cannot be used for the purpose of determining the existence of the alleged close association.

The Commissioner's submission 52The Commissioner contends that Tony's fitness and propriety to be and remain the holder of his licence is to be determined by reference to the fitness and propriety of his "close associates" to be such a licensee. 53It is submitted that in assessing the suitability of a master licence holder, sub-section 15(5) permits the Commissioner to consider a wider scope of materials to better enable the Commissioner to assess whether an applicant is influenced, as a consequence of his/her association, by another. 54The Commissioner argues that the proper intent of the provision is to enable the Commissioner to inform himself from information relevant to the suitability of the applicant for a master licence. It is consistent with this legislative purpose that the proper construction of sub-section 15(5) is to permit the use of section 15(6) material in the assessment of whether a person is a close associate of an applicant. It is submitted that to construe otherwise would mean that there is no purpose achieved by extending the application of the term 'applicant' to include 'each close associate of the applicant'. 55The Commissioner submits that section 15(1)(a) is to be construed as follows: "15(1)(a) The Commissioner must refuse to grant an application ... if the Commissioner is satisfied that the applicant [including each close associate of the applicant]: (a)is not a fit and proper person to hold the class of licence sought by the applicant". 56For the same reasons, the Commissioner submits that section 15(6) is to be construed as follows: "15(6) For the purpose of determining whether an applicant [including each close associate of the applicant] is a fit and proper person to hold the class of licence sought by the applicant, the Commissioner may have regard to any criminal intelligence report or other criminal information held in relation to the applicant [including each close associate of the applicant] that: (a)is relevant to the activities carried out under the class of licence sought by the applicant, or (b)causes the Commissioner to conclude that improper conduct is likely to occur if the applicant [including any close associate of the applicant] were granted the licence, or (c)causes the Commissioner not to have confidence that improper conduct will not occur if the applicant were granted the licence." 57Alternatively, the Commissioner submits that section 15(5) can be viewed as making each close associate of the nominal applicant itself a notional joint applicant for the licence sought. The Commissioner contends that on either approach, Tony's fitness and propriety to be the holder of a licence is to be determined by reference to the fitness and propriety of his "close associates" to be such a licensee. 58In support of that view, the Commissioner argues that Information that he obtained about an applicant's associations with others is information 'held in relation to' the applicant. Further, that or other information held by the Commissioner may suggest that those associates either: (1)engage in criminal activity, or (2)are themselves associates of persons who engage in or are associated with criminal activity. 59The Commissioner submits that if that were the case, then the information held by the Commissioner is "criminal information held in relation to ... " the applicant because of his association with those persons. 60Further, the Commissioner submits that as reports and information about an association between persons will very commonly, but to varying degree, be informative as to the nature and purpose of the association it is "improbable" that section 15(6) was not intended to permit recourse to reports and information (1)for the purpose of identifying the fact an applicant's associations with those who engage in criminal activity, but (2)not for the purpose of identifying the nature and purpose of the association, which may be innocent or sinister. 61If it is accepted that reports and information may be used as evidence of the nature and purpose of an association between an applicant and another, then there is no reason why that information cannot be used in determining whether the association is a "close association" for the purposes of section 15(6). 62There is nothing in the terms of section 15(6) that suggests 'criminal intelligence report or other criminal information' may not be used at every step the provision requires for a determination of fitness and propriety. 63The determination of whether there is a "close association" between an applicant and another individual, because of the operation of section 15(5), is made "For the purpose of determining whether an applicant 'including each close associate of the applicant' is a fit and proper person". 64In summary, the Commissioner contends that, as the fitness and propriety of an applicant holding his master licence is to be decided by reference to the fitness and propriety of his close associates, (1)evidence of his association with another individual is material held in relation to him because he is its direct subject, and (2)evidence held about any close associate is evidence held in relation to him for the purposes of section 15(6) because, although he may not be the or a subject of that material, his close associate is, and The terms of section 15(6) do not require that any putative close association be proved only by material which is not "criminal intelligence report or other criminal information".

Discussion 65I agree with the Commissioner in regard to this issue. In my view, that construction is consistent with the legislative intent of section 15. 66In making these findings I have been conscious of the remarks in FCT v Citibank Ltd referred to above and the similar remarks of the Chief Justice in K-Generation Pty Ltd v Liquor Licensing Court [2009] HCA 4; (2009) 252 ALR 471 at [84] where his Honour said: "There is also a well established and conservative principle of interpretation that statutes are construed, where constructional choices are open, so that they do not encroach upon fundamental rights and freedoms at common law. That is to say, there is a presumption against a parliamentary intention to infringe upon such rights and freedoms." 67Section 15 prescribes criteria for suitability of a licence holder. Specifically, in assessing the suitability of a master licence holder, section 15(5) permits the Commissioner to consider a wider scope of materials to better enable the Commissioner to assess whether an applicant is influenced, as a consequence of his/her association, by another. 68The proper intent of the provision is to enable the Commissioner to inform himself from information relevant to the suitability of the applicant for a master licence. It is consistent with this legislative purpose that the proper construction of section 15(5) is to permit section 15(6) material in the assessment of whether a person is a close associate of the applicant. To construe otherwise would mean that no purpose is achieved by extending the application of the term 'applicant' to include 'each close associate of the applicant'. 69In my view, material, if any, tendered on the issue of Peter's fitness and propriety, and material, if any, which comes within section 29(3) of the Act may be relied upon in the determination of the issue of "close association". The use of material, if any, relevant to Peter's fitness and propriety does not eliminate the operation of section 29(3) the Act. 70Consistently with the approach that I have adopted in these proceedings I do not propose to indicate whether or not I have referred to section 15(6) material in the assessment of whether Peter is a "close associate" of Tony or of AVS GA.

Confidential Exhibit C6B 71The Applicants have sought reasons for the Tribunal's ruling that the part of Confidential Exhibit C6B ("the C6B documents") that has been disclosed to the review Applicants is material referred to in section 15(6) of the Act. 72It is submitted on behalf of the Applicants that the Commissioner did not have regard to the C6B documents in deciding that Peter was not a fit and proper person to hold a security licence. The Commissioner accordingly has not used the subject documents in a manner that brings them within the scope of reference of section 15(6) of the Act. Further, the Tribunal has not had regard to the C6B documents, and may never have regard to them, for the purpose of determining whether Peter is a fit and proper person to hold a security licence. The Tribunal accordingly has not used the subject documents in a manner that brings them within the scope of reference of section 15(6) of the Act. 73It is submitted that since the C6B documents have not been used for a purpose to which section 15(6) of the Act refers, they cannot at the present time be documents "referred to in section 15(6)" within the meaning of section 29(3) of the Act. 74I do not agree with that narrow construction of the Act. At the time the issue arose for consideration by the Tribunal, it was open to the Commissioner to place the C6B documents before the Tribunal for consideration for "the purpose of determining whether an applicant is a fit and proper person to hold the class of licence sought by the applicant". It became necessary to form an opinion with respect to whether the C6B documents comprised "criminal intelligence report or other criminal information held in relation to the applicant". I in fact formed the view that the C6B documents met that description. In doing so, I adopted the view that a broad approach should be taken to the construction of the expression "held in relation to the applicant". 75In my view, the C6B documents are relevant to the particular purpose for which section 15(6) authorizes use of the material. I do not agree with the Applicants' submission that information provided by an applicant necessarily falls outside the scope of reference of section 15(6) of the Act. In my view, information need not be detrimental to an applicant's case to fall within the scope of the section.

Confidential Exhibit C18 76The Applicants have sought reasons for the Tribunal's ruling that Confidential Exhibit C18 ("the C18 material") is material referred to in s 15(6) of the Security Industry Act. 77As was the case with the C6B documents it became necessary that I form an opinion with respect to whether the C18 material comprised "criminal intelligence report or other criminal information held in relation to the applicant". I in fact formed the view that the C18 material met that description. In doing so, I adopted a broad approach should be taken to the construction of the expression "held in relation to the applicant". 78[Not for publication]

Commissioner's Outline of his 'Close Association' case 79The Commissioner contends that Peter is a 'close associate' of Tony and/or AVS GA. 80Close association will be established if the evidence discloses that Peter (1) held a relevant "financial interest", or (2) was 'entitled to exercise a relevant power', in the business carried on under the Tony/AVS GA licence (the "AVS GA Business") and in either case is or will be able (in the opinion of the Commissioner) to exercise a significant influence over or with respect to the conduct of that business, or (3) held a relevant position in that business. 81The Commissioner's case is that (1) there is evidence of specific occasions throughout the period of the existence of the Tony/AVS GA licence of Peter exercising 'directorial, managerial or executive' authority in the AVS GA Business, (2) it is to be inferred from that evidence that Peter (a) was entitled to exercise a relevant power, and/or (b) held a relevant position, in that business, and (3) the evidence in (1) considered with the balance of the evidence permits conclusions in terms of each of (2) to (3) above. 82As to (3) above, the Commissioner contends that the evidence discloses (1) the operation of an entity operating commercially as 'AVS' and/or 'Australian Venue Security'. (2) prior to October 2006 Peter (a) held a financial interest, (b) exercised a power, and (c) held a position, in the business of AVS, and in particular that part of it that thereafter became the AVS GA Business, (3) that interest, power and position was in each case what is defined in the Act as a 'relevant financial interest', relevant power' and 'relevant position', and (4) AVS GA and AVS GC each being manifestations of the AVS entity, 83Alternatively, the Commissioner contends that the evidence of Tony that is to the effect that he is in effect in sole ownership and control of AVS GA and the AVS GA Business, i.e. that no-else else has been relevantly financially interested, empowered or positioned in that business, should not be accepted, the consequences being, (1) that AVS GA has a close associate the identity of whom has not been disclosed, and (2) for that reason (a) each of AVS GA and Tony is not a fit and proper person to be the holder of a licence; in which event the licence must be revoked, or (b) for the reason in (1) above alone, the licence should be revoked. 84Alternatively, the Commissioner contends that in the event that the Tribunal finds that Peter (1) is not a 'close associate' of Tony/AVS GA, but (2) is nevertheless involved in directorial, managerial or executive functions in the AVS GA Business, or otherwise in full or partial control of that business, it cannot then proceed to allow the Application for Review and set aside the Commissioner's revocation of the Applicants' master licence. 85In the circumstances of those findings, the Commissioner contends that the Tribunal is constrained to consider whether Peter is a fit and proper person to be (1) a holder of a licence under the Act, or (2) involved in the AVS GA Business. 86If the Tribunal finds that Peter is not so fit and proper the Tribunal must consider whether (1) Tony's permitting or acquiescing in Peter being so involved, reveals himself and/or AVS GA to be not a fit and proper person to hold the licence, and (2) it should confirm the revocation of the Tony/AVS GA licence on the ground that it is not in the public interest that it continue to be held by Tony/AVS GA.

Relevant Power 87Firstly the Commissioner relies upon evidence of specific occasions throughout the period of the existence of the licence of AVS GA where Peter exercised "... directorial, managerial or executive ..." authority in the business of AVS GA. The Commissioner argues that it is to be inferred from the evidence of those specific occasions that Peter was entitled to exercise a relevant power, and/or held a relevant position in that business. 88In so far as the Commissioner's submission that the evidence allows an inference that Peter was entitled to exercise a relevant power in the business of AVS GA, it was developed such that the Commissioner was contending that Peter exercised de facto managerial authority over the business of AVS GA after October 2006. The contention is that the entitlement to do so was based upon a construction of section 5(2) in which relevant power is defined. For present purposes it is necessary to determine, in the context of the definition that ""relevant power" means any power, whether exercisable by voting or otherwise ...", what affect the phrase "or otherwise" has upon the construction of the breadth of the definition. The phrase qualifies the word "power". It follows that it cannot import into the definition of "relevant power' anything that is not a power. 89In Avilion Group Pty Ltd v Commissioner of Police, NSW Police (GD) (No 2 ) [2010] NSWADTAP 56 (" Avilion AP ") the Appeal Panel considered the construction of section 5(1)(a) and specifically the word "entitled". The Appeal Panel held that: 83 This question of the scope of the term 'entitled' in section 5(1)(a) of the SI Act is not an easy one. Our conclusion with regard to it is that, despite the force of some of the arguments put by Mr Bourke, the intention of the Act is that the term should be confined to 'entitlements' that are capable of enforcement by legal means. We base this conclusion on the following considerations:- (i) The dictionary definitions cited to us, together with the dicta described above, delineate a concept that embraces legal rights and 'just claims' but stops short of de facto powers. (ii) In section 5(1)(a), the phrase 'is or will be entitled to exercise any relevant power' is followed immediately by a phrase suggesting legal entitlement - i.e., 'whether in his or her own right or on behalf of any other person'. (iii) To characterise as an 'entitlement' the form of 'surreptitious' controlling influence that the Tribunal found Mr Blissett to be able to exercise over Avilion takes the term 'entitlement' a long way outside the realm of legal rights and 'just claims'. (iv) There are a number of forms of legal entitlement - for example, a purely contractual right, enforceable through an action for damages - under which a person might participate in the management decisions of a company without being formally appointed to a recognised position within the company, such as that of director or manager. For this reason, restricting 'entitlement' in section 5(1)(a) to legal entitlements does not narrow the scope of 'relevant power' to the extent that it is effectively synonymous with 'relevant position'. (v) If the legislature had wished, in this part of the definition of 'close associate', to refer to situations where a person actually exercises - as opposed to being entitled to exercise - a significant influence over decisions made by a license applicant or holder, it could very easily have used language that made this clear. (vi) As the Tribunal's decision illustrates, the 'public interest' ground on which it separately based its decision to confirm the Commissioner's revocation of Avilion's licence may, in appropriate circumstances, cover the situation where an unsuitable person exercises a significant influence over the conduct of the business of a licence holder, but has no 'entitlement' to exercise such influence. (vii) The legislature's use of the term 'entitled' actually brings within the ambit of 'close associate' persons who at the relevant time do not exercise such influence, but are merely 'entitled' to do so. The task of proving that a person is 'entitled' to exercise a 'relevant power' and for that reason is or will be 'able' to exercise a significant influence over the conduct of the business of the licence applicant or holder may sometimes be easier than proving that he/she does in fact exercise such influence. 90The Appeal Panel's conclusion is contrary to the first construction advanced by the Commissioner. The ability of a person to influence a business in the nature of one family member upon another does not amount to an entitlement to exercise a relevant power. 91The Appeal Panel's decision was the subject of appeal to the Court of Appeal: Avilion Group Pty Ltd v Commissioner of Police [2010] NSWCA 275. The appeal was dismissed. However, Allsop P stated at paragraphs [3] - [4]: 3 As to the question of "close associate", a difference of view arose principally by reference to the phrase "entitled to control" in s 5 as applicable to the facts and by reason of a holding of a relevant position. 4 The correctness of the approach of the Appeal Panel would arise if one or more of the grounds is or are upheld. For the reasons that follow, I am of the view that none of the appeal grounds has merit. It is, therefore, unnecessary to deal with the notice of contention. However, it is appropriate to say this, with respect to the members, that the lack of dealing with the notice of contention should not be taken as my agreement with the Appeal Panel's approach to the operation of the definition of "close associate". 92In the Commissioner's submission, the Appeal Panel wrongly decided the issue of the scope of the term 'entitled' in section 5(1)(a) of the Act. I note that the Court of Appeal left the issue open. However, I do not consider that this is the correct forum to revisit that issue. 93In relation to the Commissioner's further submission that Peter was the true controlling mind, I note that the status of the evidence in this matter is different from that with which the Appeal Panel dealt in Avilion AP . 94Although the Appeal Panel in Avilion AP rejected the submission that the criteria had been met in section 5(2) as the evidence as to the nature of the position of Mr Blissett was less clear, the Appeal Panel declined to substitute its own decision for that of the Tribunal's given the evidence of the level of control exercised by Mr Blissett in the business of Avilion. The Appeal Panel was unwilling to do so, not as a matter of construction, but as a matter of procedure. The Appeal Panel was confined to questions of law. The Appeal Panel did not otherwise address the scope of the phrase "relevant position". 95In this matter, the evidence as to Peter's activities is clear. The dispute between the parties is primarily about how those activities are to be interpreted.

Holds or will hold any relevant position 96In my view, the Appeal Panel decision in Avilion AP is not authority for the proper construction of the expression "holds or will hold any relevant position". It does not preclude the construction urged by the Commissioner to the effect that an individual exercising control over a business holds a relevant position. 97The Commissioner argues that there is no basis for importing the requirement of "entitlement" into section 5(1)(b). If the Commissioner's submission is correct, the scope of the provision could extend to a circumstance where an individual was able to influence a person with that legally enforceable entitlement. If the further submission is correct, the phrase in section 5 (1)(b) " and other executive position " is to be given an expansive construction such that it includes an individual acting in a role approximating a managerial role in the business. The Commissioner contends that such a construction promotes the purpose of the Act to prevent persons who are not fit and proper to hold a licence from acting on behalf of a security business. 98Section 9 of the Corporations Act defines director as: "director" of a company or other body means: (a)a person who: (i) is appointed to the position of a director; or (ii) is appointed to the position of an alternate director and is acting in that capacity; regardless of the name that is given to their position; and (b) unless the contrary intention appears, a person who is not validly appointed as a director if: (i) they act in the position of a director; or (ii) the directors of the company or body are accustomed to act in accordance with the person's instructions or wishes. Subparagraph (b)(ii) does not apply merely because the directors act on advice given by the person in the proper performance of functions attaching to the person's professional capacity, or the person's business relationship with the directors or the company or body. 99The Applicants argue that if the Act was intended to include de facto directors or shadow directors within the ambit of "close associates" of a security business, it would have enacted provisions comparable to section 9(b)(i) or (b)(ii) of the Corporations Act . It did not do so. 100I agree with that submission insofar as it relates to the position of directors. However, in my view the standpoint in regard to the proper construction of the expression " and other executive position " is not so clear. 101In Corporate Affairs Commission (NSW) v Yuill (1991) 65 ALJR 500 Brennan J approved the approach to statutory construction of Lord Reid in Black-Clawson Ltd v Papierwerke AG [1975] AC 591 We often say that we are looking for the intention of Parliament, but that is not quite accurate. We are seeking the meaning of the words which Parliament used. We are seeking not what Parliament meant, but the true meaning of what they said 102However, Lord Simon of Glaisdale explained in that case: ... if the draftsman uses the tools of his trade correctly, the meaning of his words should actually represent what their promulgator meant to say. And the court of construction, retracing the same path in the opposite direction, should arrive, via the meaning of what was said, at what the promulgator meant to say ... 103The courts are duty bound to give effect to the words of the legislature: Sorby v Commonwealth (1983) 152 CLR 281 at 322. It is only when a rule of construction fails to yield the effect that the court considers the legislature intended by its words, that it is permissible to consider a new rule of construction better fitted to the considered intention: Bropho v Western Australia (1990) 171 CLR 1. Although in a dissenting decision in Yuill , Gaudron J said at 508: The difficulty inherent in the notion of "the intention of the legislature" dictates that, save where there are settled rules or where there is some feature of the legislation requiring otherwise, the legislature should be taken to have said what it meant and to have meant what it said. Or, more accurately in terms of legal principle, the words of the statute should be taken to bear their natural and ordinary meaning. 104The Applicants referred to Cockerell v Fry (1967) LGRA 164 in which McInerney J held at 178 that holding office is ordinarily regarded as following appointment; not the exercise of its functions without having been formally appointed. 105It is submitted that the Commissioner must establish, directly or inferentially, that Peter "held" the position of a director, manager, executive or secretary in the AVS GA business in the legally relevant sense of being duly appointed to one or more of those positions, and consequently entitled to exercise the privileges that such appointment conferred. Further, it is submitted that the evidence in these proceedings could not reasonably satisfy the Tribunal that Peter, at any time after October 2006, "held", in that legally relevant sense, any "relevant position" in the business of AVS GA. 106In my view, circumstances exist in this matter that take it out of the ordinary. I consider that the circumstances in which an individual with a legally enforceable entitlement permits an individual without such an entitlement to exercise a significant influence over or with respect to the conduct of that business permit the departure from the usual situation referred to in Cockerell v Fry . 107In the circumstances of a family business arrangement, directors commonly are formally appointed. However, it is less likely that individuals will be formally appointed to other roles within a family business than in the wider commercial sphere. 108In my view, the close scrutiny and a strict reading urged by French J in FCT v Citibank Ltd supports the Commissioner's contention. The use of the words "manager, and other executive positions and secretary, however those positions are designated" in section 5 of the Act suggests to me that the legislature intended that an official title is not conclusive of the issue. The actual role played by an individual must be considered to determine whether or not the duties can reasonably considered as falling within the scope of one or more of those positions. 109It is not necessary that the Commissioner establish that Peter "held" a "relevant position" in the business of AVS GA in the legally relevant sense. It is sufficient if the Commissioner establishes that Peter exercised the functions of such a position without having been formally appointed. 110That construction of the provision promotes the purpose of the Act to prevent persons who are not fit and proper to hold a licence from acting on behalf of a security business.

Relevant financial interest 111Secondly, the Commissioner submits that the balance of the evidence discloses that AVS GA was the same entity as a previously operating entity, Australian Venue Security ("AVS") in which Peter held a financial interest, exercised power and held a position prior to October 2006. The Commissioner contends that AVS GA's business is in reality the business of AVS but by a different name. In order that this contention be accepted, it is necessary to find that the interest, power and position be a relevant financial interest, a relevant power and a relevant position within section 5 the Act, and that AVS GA is AVS but by a different name. 112It is not in issue that as and from 23 August 2006 Peter did not hold any share in the capital of AVS GA and following 17 October 2006 there is no evidence that the income of AVS GA was paid to entities owned or controlled by Peter. The evidence does not disclose any interest in the capital of AVS GA or an entitlement to the income of AVS GA after October 2006, other than receipt of monies by the AVS GA Trust from income derived by AVS GA. It is the characterization of Peter's beneficial entitlement under the Trust Deed that warrants consideration, as this is the basis for the assertion of his having a relevant financial interest in the business of AVS GA. 113The Applicants contend that the assessment of whether an individual holds or will hold a relevant financial interest and thereby is able to influence the business of a licensee is confined to either a share in the capital of a business or an entitlement as described in section 5(2)(b) of the Act; the entitlements being confined to those capable of enforcement by legal means. The Applicants contend that more than the influence of one family member (Peter) over another (Tony) is necessary for the entitlement described in section 5(2)(b). 114The Commissioner submits that Tony and Peter were business partners in AVS GA before October 2006. However the evidence underlying that submission must be read with the balance of Tony's evidence, viz from 22 August 2006 Tony owned and controlled AVS GA, which owned the good will of the business of AVS from 21 October 2006. Prior to 21 October 2006 Tony had no entitlement to any of the profits of the business of AVS. 115The Commissioner submits that the inclusion in section 5(2)(b) of entitlements arising ' at law or in equity or otherwise' extends the entitlement from that which is enforceable at law or in equity to that of one where the entitlement to receive income arises, in this case, beneficially from either AVS GA Trust or the Sly Fox Family Trust of which Tony is the appointor and the specified beneficiary. 116The terms of the Sly Fox Family Trust Deed are identical to AVS GA Trust Deed. O'Malley's Hotel is a venture of the Sly Fox Family Trust of which Peter was a beneficiary since the acquisition of O'Malley's Hotel. The inference the Commissioner asks to be drawn is that as O'Malley's Hotel is Peter's and he is able to significantly influence the operation of that hotel, his designation as a beneficiary of the Sly Fox Family Trust is indistinguishable from his designation as a beneficiary of the AVS GA Trust such that he is able to significantly influence the operation of AVS GA. 117However, in this regard, l note that AVS GA Trust is a discretionary trust; a general beneficiary of a discretionary trust has no vested interest in the trust property, and no entitlement to receive any part of the trust income. Until such time as a distribution is made in Peter's favour, the only entitlement of a general beneficiary is an entitlement to be considered for such a distribution: Garside v Inland Revenue Commissioners [1968] AC 553 per Lord Reid at 607. The Applicants contend, and I agree, that even if a discretionary distribution were made, it would not be a correct characterization of that distribution as an entitlement from the business of AVS GA. 118In the absence of evidence disclosing an entitlement to income other than that as a beneficiary to a discretionary trust, I find that Peter had no relevant financial interest in the business of AVS GA after October 2006.

An Undisclosed Unidentified Close Associate 119Thirdly, the Commissioner contends that the Tribunal would reject Tony's evidence that he owns and controls AVS GA such that no-one else has a relevant financial interest, exercises a relevant power, or occupies a relevant position in the business of AVS GA. the Commissioner submits that if the evidence does not permit a finding that Peter is the close associate of AVS GA, but the evidence does support a finding that there is an undisclosed close associate, the Act entitles the Commissioner to revoke the licence, and Tony is not a fit and proper person to be the holder of a licence. 120Clause 13(3)(c)(ii) of the Security Industry Regulations 2007 ("the Regulations") obliges a corporation seeking a master licence to disclose a close associate of the applicant. Clause 13(3) provides: 13 Information and particulars to accompany licence application: section 14 (2) (b) ... (3) Master licences-corporations For the purposes of section 14 (2) (b) of the Act, an application for a master licence that is made by a corporation (other than a government agency or public authority) must include the following information: (a) the name of the applicant, (b) the applicant's Australian Business Number and Australian Company Number and each business name (within the meaning of the Business Names Act 2002) under which the applicant carries on business, (c) the nominated person for the licence, being an individual who is: (i) an Australian citizen or permanent Australian resident, and (ii) a close associate of the applicant, and (iii) involved in the day-to-day conduct of the applicant's security activities, (d) the name, date and place of birth and residential address of each of the applicant's close associates, ... 121Clause 34 of the Regulations obliges the licensee to disclose any change relating to close associates of that licensee: 34 Requirement to notify changes relating to close associates It is a condition of a master licence that the licensee must notify the Commissioner in writing of any change in the particulars relating to the close associates of the licensee within 14 days after the change occurs. 122If it is found that Tony and/or AVS GA has a close associate, and failed to disclose that close associate, section 26(1) of the Act entitles the Commissioner to revoke the licence. 123Evidence that Tony was irresponsible or incompetent in the management of AVS GA is no substitute for affirmative evidence of another's entitlement to exercise any relevant power in AVS GA. The evidence does disclose an inadequacy on the part of Tony in understanding the distinction between a corporate entity and the business of the corporate entity. However, in my view it does not establish that someone other than Tony owns or controls AVS GA. 124In light of the above findings, it is necessary that I consider the material tendered by the parties and the arguments in relation to the inferences that can be drawn from that material.

The Commissioner's case on relevant position 125The Commissioner contends that the evidence of occasions when Peter engaged in what the Commissioner characterizes as "exercising '... directorial, managerial or executive...' authority" in the AVS GA business supports an inference that on those occasions Peter held a "relevant position" in the AVS GA business.

The licensing sergeants 126Senior Sergeant Darren Thompson was the licensing sergeant at the Rocks from December 2003 to May 2008. This period represents both periods of purported governance of AVS GA by Peter and Tony i.e. either side of 21 October 2006. Sgt Thompson gave evidence that he had extensive contact with Peter throughout that time and only one contact with Tony in 2004. On none of the occasions when he met Peter did Peter decline contact as the representative of AVS GA's NSW business, and on no occasion did he refer Sgt Thompson to Tony. These facts were not challenged. The change in the business of AVS AVS to AVS GA in October 2006 did not result in any change in the nature or frequency of Sgt Thomson's contact with Peter. 127Constable Randal Wood was for the period April 2007 to June 2009 the Licensing Sergeant for the Rocks LAC. The effect of his unchallenged evidence is that, for the period April 2007 to May 2008, Peter was the face of AVS business undertaking security contracts in licensed premises at The Rocks. All the venues the subject of this evidence were AVS GA clients. 128The Commissioner contends that the evidence of both Sgt Thompson and Constable Wood is further evidence of Peter continuing to perform the same management functions after October 2008 as before.

Operation Revocation 129In February 2009 police undertook "Operation Revocation". Its object was to check the licence status of persons working as "security operatives". Constable Katharine Graham prepared a checklist and it is to be inferred that was for the recording of information obtained from such operations. 130Neither AVS GA nor AVS GC was the targets of Operation Revocation. 131On the night of 6-7 February 2009 AVS GA guards were interviewed at two AVS GA venues, The Argyle and Tank. Three of the guards identified "Peter " as their "Employer Contact person". 132The statement of Ms Howard (nee Graham), prepared for a different purpose, asserts that all security operatives at The Argyle and Mr Scott Dawson were spoken to. The Commissioner accepts that it may fairly be inferred that no other AVS GA guard at either venue so identified Peter. 133Clayton Carmichael and Raymond Nanai, two of the three guards who did so identify Peter, had been employed for approximately 12 and 6 months respectively. 134The Commissioner submits that if Peter was not involved in the AVS GA Business in those periods he could not have been known to Messrs Carmichael and Nanai, as being connected to it at all, let alone as their "employer contact". It is further submitted that Peter being familiar to those employed is not consistent with his and Tony's evidence of Peter being wholly disengaged from the management AVS GA Business after October 2006. The evidence is much more consistent with Peter's own assessment of himself as "... very hands on..." in his operations. 135The Commissioner contends that those nominations of Peter as employer contact is some evidence of his holding a directorial, managerial or executive position i.e. being relevantly positioned in the AVS GA Business. 136The third nominator, Mr Dawson, had been employed for approximately 10 years. The Commissioner submits that if there had been an actual real change in the ownership or the directorial, managerial or executive control of the business after about August/October 2006, it is inconceivable that Mr Dawson would not have become aware of it; after all, hierarchically there was only an area manager between him and Peter/Tony. 137The Commissioner submits that Mr Dawson's February 2009 identification of Peter should be treated as reflecting his knowledge, as a long-term employee, of the operations of the business at that time. 138It is submitted that as at 7 February 2009 there was no reason for Mr Dawson not to have been candid in his response to the police inquiry made. There was no reason for the Police to have been anything but indifferent to his response. However, the Commissioner contends that the position is otherwise in respect of his testimony on 10 June 2011. He was not candid, very likely he was not truthful; certainly he was evasive, guarded and calculating in his answers. The Commissioner submits that Mr Dawson's attempt to suggest that the information recorded in his checklist did not come from him should not be accepted. There were four items that could not have been accurately obtained from anyone else, (1)his full name as given that evening, (2)his status as supervisor/manager at the Argyle, (3)his status as employee rather than contractor to AVS GA , (4)the duration of his employment to that time, all of which details Mr Dawson agreed were correct. 139The Commissioner further submits that, while slight in itself, the Operation Revocation evidence is consistent with, and therefore corroborative of, the other evidence from routine police activity, and the other objective evidence about the Peter/AVS GA association tendered by the Commissioner. It is inconsistent with the Applicants' case and evidence.

Ralph Guderjan 140Mr Ralph Guderjan had dealings with Peter in relation to the provision of security services to the venue Jackson's on George. Jackson's on George is a long time client of the AVS-AVS/AVS GA Business. 141Mr Guderjan's evidence is that in the interval between October 2006 and 20 August 2010 AVS GA had not informed him of Peter's departure from the AVS GA Business, and it had not otherwise become apparent to him. Mr Guderjan would speak directly to Peter about core issues or legal level issues" although as at August 2010 he had not done so "of late". 142The Commissioner contends that Mr Guderjan's evidence is evidence of Peter being relevantly empowered and/or positioned in the AVS GA Business; i.e. of Peter being a close associate. 143Peter's evidence does not challenge Mr Guderjan's account of their dealings. It does not assert no contact with Mr Guderjan in the interval between October 2006 and 20 August 2010. The Applicants do not suggest any liaison between Mr Guderjan and Tony about "core or high level issues".

Dean Martin 144Mr Dean Martin has been Group Security manager with the Merrivale Group since 2005. Mr Martin's evidence is that in about December 2008 Peter participated in discussions/negotiations about AVS GA obtaining work at a clubbing venue known as 'Tank'. Peter was thereafter seen in circumstances suggestive of him having a non-operational (ie. managerial) function in the performance of that work. 145Peter's evidence is to the effect that the discussions/negotiations took place in two immediately successive meetings, not one, and that Mr Martin was not present at the first. Mr Martin acknowledged that that was so. 146Peter's evidence is that he introduced himself as being "from AVS Group of Companies". Mr Martin did not concede that was so. His recollection remained that the introductions were in terms of "AVS". , 147Peter's evidence is that he was present at, but not a participant in, the discussions/negotiations at either of the meetings. His explanation for his presence being that he had a personal relationship with a Mr Savage. 148Mr Martin acknowledged that most of the discussions in the second part of the meeting was between himself and Mr Scott Taylor, and concerned operational, rather than financial matters. He did not concede that there was no participation by Peter. 149The Commissioner submits that even if Peter's account of the second stage of the meeting is accepted it does not establish that Peter did not participate in the financial arrangement made in the first phase. It is further submitted that the evidence of Peter's persistent involvement in the AVS GA Business after August/October 2006 and up to December 2009 suggests the implicit explanation for Peter not to be involved in the financial discussions should not be accepted. 150The Commissioner argues that the issue about the first stage is one of credit. The effect of Peter's own evidence is that it was he himself who knew the guards who were to be and who were supplied for the work, and decide that AVS GA rather than AVS GC would obtain the Tank work. Peter stated: 151"When I arrived at the meeting it was my intention to permit Scott to contract for the work directly on behalf of Group Australia". 152The Commissioner submits that subsumed within that statement is an acknowledgement of the capacity of Peter to direct Scott Taylor to prefer AVS GC to AVS GA, and prevent AVS GA from seeking and obtaining that or other work, i.e. that Peter was relevantly empowered or positioned in the business of AVS GA. 153No explanation is offered for Tony's absence from the discussions/negotiations. Tony's own evidence is that neither Peter nor Scott Taylor ever informed him of the occurrence of the Tank meeting. The Commissioner submits that at the least it is surprising that neither of Peter nor Scott Taylor ever reported the meeting to Tony given that Peter asserts that Tony was by then the principal of the AVS GA Business. 154Peter provided further (direct) evidence of him being relevantly empowered or positioned in the AVS GA Business on multiple occasions: (1)the guards working at Tank phoned him directly upon the advent there of "... troublesome bikie gangs ...", a management issue, (2)to come and help manage it, (3)he directly acceded to each request and undertook the supervision of those guards and the management of those situations, and (4)did so without reference to or regard for the ostensible formal management structure of the AVS GA Business. 155The Commissioner submits that each of the occasions was an occasion where Peter made and "participate[d] in [a] directorial, managerial or executive decision" in AVS GA Business on his own authority. It is further submitted that Peter's own evidence is evidence to the effect of his being a "close associate" of Tony/AVS GA. 156The Commissioner argues that Peter's relationship to the AVS GA "bikie troubles" at Tank itself gives a reason to doubt the accuracy of Peter's explanation for his involvement in the discussion/negotiations at Tank, and illuminates the meaning of his statement about his capacity "to permit" that work, particularly in the context of Tony's evidence that he was never informed of the occurrence of the Tank meeting. 157In any event the Commissioner contends that to the extent that the resolution of any conflict between Peter's testimony and that of Mr Martin is necessary, the matter is essentially one of credit. The Commissioner contends that Peter should be found to have no credit.

Cameron Smith 158Mr Cameron Smith is the registrar of the Security Industry Registry and was appointed on 27 October 2008 but had acted in the position since 12 June 2007. He gave evidence of 3 meetings that he had with Peter and Scott Taylor: 29 January 2008 (with Peter Nassif attending), 12 November 2008 (with Joe Nasr attending) and 22 June 2009 (with Joe Nasr attending). His evidence is that throughout those meetings no distinction was made by any party of the various AVS entities, the descriptor "AVS" was uniformly used, and Scott Taylor is described as deferring to Peter on operative issues for AVS's operations in NSW. Peter does not dispute the use of AVS as a descriptor at these meetings. He does however dispute Mr Smith's evidence that Peter was introduced as 'our director', and the staffing difficulty identified as being AVS's difficulty. Otherwise, Peter explains the absence of Tony and his leading role as being a consequence of being at the meeting on behalf of AVS GC; the meeting is said not to have concerned the business of AVS GA. 159The Commissioner contends that Peter's explanation should not be accepted; and if not accepted this infers and reinforces the balance of evidence that Peter is relevantly financially interested, empowered and/or in a positioned in the AVS GA business. The subject matter of the first meeting was employment issues. As such it could not have concerned AVS GC as its licence precludes it being an employer. Secondly, the Commissioner contends that the presence of Joe Nasr would be anomalous if it was for the business of AVS GC as he was not employed by AVS GC in November 2008. Thirdly, the Commissioner contends that the topic of the second meeting was Peter's purchase of Asset Security and Training Pty Ltd. Peter does not deny the In the course of that meeting, he said: "we can employ good quality people ... it is difficult to get good guards." 160The meeting did not concern the operations of AVS GC as an employer. In the context of the operation of Asset Security and Training Pty Ltd and the interest of AVS GA as an employer within NSW security industry, it is inherently unlikely that Peter would not have distinguished AVS GA as having the staffing difficulties rather than the industry generally. 161The Commissioner submits that these are specific occasions throughout the period of the existence of the licence of AVS GA where Peter exercised "... directorial, managerial or executive ..." authority in the business of AVS GA. The Commissioner further argues that it is to be inferred from the evidence of those specific occasions that Peter was entitled to exercise a relevant power, and/or held a relevant position in that business. 162In the event the account of Mr Smith is considered reliable, the conclusions advanced by the Commissioner are available.

The Applicants' case on relevant position 163Tony's evidence is that, for some time after October 2006, about once or twice a month, he requested and received from Peter unpaid advice about such matters as risk management at hotels. Tony and Peter both gave evidence that between 2006 and 2007 or 2008, Peter volunteered his advice to assist the AVS GA business at a time when it was losing clients. 164It is submitted that the role performed was advisory only. Peter attended meetings with AVS GA clients only in the company of appointed directors or managers of the AVS GA business. He did not purport to make, on his own authority, any promises binding on AVS GA. It is further submitted that an occasional provider of voluntary advice is not the holder of a "relevant position". putting the evidence at its highest, it shows that the role that Peter performed was that of an unpaid consultant or adviser.

Evidence concerning Peter's dealings with Dean Martin 165Peter gave additional evidence about the meeting that he attended, together with Scott Taylor, then the State Manager of the AVS GA business, at the Establishment Hotel. On Peter's account, he attended the meeting at the invitation of a former client who was also a personal friend, and with the intention of helping out Tony by permitting AVS GA to contract for the business rather than taking the business himself through AVS GC. 166Mr Martin confirmed Peter's evidence that it was Scott Taylor, and not himself, who did the bulk of the talking at the meeting. Peter's evidence is that he introduced himself as being 'from AVS Group of Companies". In cross examination, Mr Martin conceded that Peter might have introduced himself in those terms. 167It is submitted for the Applicants that at its highest, the evidence is that Peter voluntarily, and for no reward, solicited work with the Merivale Group, for the AVS GA business. These dealings did not involve "exercising ... authority" in the AVS GA business. They do not support an inference that Peter held a "relevant position" in the AVS GA business, or that he purported to hold such a position, or that the lawful director of AVS GA habitually entrusted him with directorial or managerial functions. 168Peter and Dean Martin agree that on a small number of occasions after AVS GA entered the Merivale contract, Peter was present at the Bridge Lane entrance of the "Tank" Bar in company with the AVS GA security guards. Peter says that these were occasions when he attended voluntarily at the request of former employees who were also personal friends, to smooth over confrontations with bikies. Mr Martin was not in a position to know anything that would enable him to say otherwise. 169It is submitted that Peter was not "exercising ... authority" in the AVS GA business, or purporting to do so, when he intervened at the door of the "Tank" Bar. He was volunteering assistance to former employees who were his friends, and doing so at their request. He was not purporting to be a manager, still less a director, of the AVS GA business.

Evidence concerning Peter's dealings with Senior Sergeant Thompson 170Peter does not dispute that he continued to have contact with Senior Sergeant Thompson in The Rocks after October 2006 and up until May 2008. He gave evidence that he regularly spoke to Senior Sergeant Thompson about matters affecting licensed venues, including venues that were serviced by the AVS GA business. He denies, however, ever telling anyone that he was the owner of AVS GA. Senior Sergeant Thompson did not say that his continuing understanding that Peter was the owner of the AVS GA business was based on anything Peter said, or on anything at all other than the mere fact that, after October 2003, no-one ever told him otherwise. 171It is submitted that Senior Sergeant Thompson does not positively say that he can recollect the detail of any particular dealing that he had with Peter after October 2006 and that this is significant. It is argued that the evidence of Senior Sergeant Thompson is consistent with those of his recollected dealings in which Peter acted on behalf of the AVS GA business having all occurred during the period prior to October 2006, and his dealings with Peter after that date having all been dealings of the kind that Peter described. 172It is submitted that Senior Sergeant Thompson's evidence would not enable the Tribunal to be satisfied that Peter was "exercising ... authority" in the AVS GA business, or purporting to do so, in any particular dealing that he had with Senior Sergeant Thompson after October 2006.

Submissions concerning Peter's dealings with Constable Wood 173It is submitted for the Applicants that the Tribunal could not rationally and/or consistently with the rules of natural justice, give Constable Wood's conclusions any weight at all. Those conclusions were admitted for whatever they are worth. It is submitted that in proceedings where the existence or otherwise of any factual basis for conclusions to the effect of Constable Wood's conclusions is the central issue, those conclusions standing alone are worth nothing.

Submissions concerning the "Operation Revocation" documents 174It is submitted for the Applicants that while each of the three documents relate to a person who, it may be accepted, was, in February 2009, employed by AVS GA as a security guard, there is no evidence that the guards themselves were the sources of the contact person representations. Scott Dawson gave evidence that he could not have been the source. 175It is further submitted that there are plausible explanations for how Peter could have come to be identified as the "Employer contact person" in respect of the relevant guard. Mr Dawson gave evidence that, at the time when Constable Graham interviewed him, he was wearing his lanyard. That lanyard is clearly marked with the words "AVS Group of Companies". It is suggested that had Constable Graham placed a telephone call to security industry registry and in the course of that telephone call identified to the registry operator that "AVS Group of Companies" was the relevant employer, the registry operator would have been expected to access registry records that would identify Peter as the licensee of that entity, and to communicate that information to Constable Graham. 176Constable Graham was not called to give evidence. It is submitted that the Tribunal should therefore draw the usual inference, which is that her evidence would not have assisted in proving that the representations as to "Employer contact person" in the "Operation Revocation" documents were obtained from a source, or in circumstances, of such a kind that the Tribunal can properly give them any weight.

Submissions concerning the evidence of Ralph Guderjan 177It is submitted for the Applicants that there is nothing in Mr Guderjan's evidence that the Tribunal could regard as evidence that Peter has been a close associate of the AVS GA business at any time after October 2006. Mr Guderjan says only that he met Peter well prior to October 2006, and that since that time, no-one has positively told him that Peter is no longer in charge of the AVS GA business. 178On his own evidence, Mr Guderjan has "not spoken to Peter of late". The period to which he was referring is not clear. It is submitted that the Tribunal cannot rationally or fairly draw any inference adverse to the Applicants from this evidence.

Submissions concerning Cameron Smith's evidence 179It is submitted for the Applicants that Mr Smith's evidence relevantly amounts to nothing more than the following:

• In three conversations that he had with Peter, he observed that Scott Taylor and David Nassif behaved in Peter's presence as though Peter was the boss of the entity that Peter claimed to be speaking for, and which Mr Smith understood to be called "AVS".
• No-one who might reasonably have been expected to have reliable knowledge of the matter ever told Mr Smith that the entity for which Peter was speaking, and which Mr Smith identified as "AVS", did not own and operate the AVS GA business. 180Mr Smith never inquired whether Peter was representing any business that currently employed security guards, or was currently licensed to do so in New South Wales, and that the conversations he had with Peter were not of such a nature as to put Peter, Scott Taylor or anyone else on notice that Mr Smith might have expected Tony or AVS GA to be mentioned. 181It is further submitted that Mr Smith's evidence in regard to the website could not responsibly be regarded as a basis for revoking the relevant master licence on the ground of an undisclosed 'close association'. The website is uninformative as to the precise corporate structure of the entities whose services it promotes, but it does not follow that the purpose of the website is to mislead anyone. And even if the website had been intended to mislead someone, it would not follow that the intention was to mislead anyone into believing that Peter no longer owned or controlled the business of AVS GA when in fact he did. It is further submitted that on the evidence, if Tony had a motive to mislead anybody about anything after October 2006, it was a motive to mislead his customers into believing that Peter did still own and/or control the business of AVS GA when in fact he did not.

The Assessment of the Credibility of Tony and Peter 182Thirdly, the Commissioner contends that the Tribunal would reject the evidence of Peter and Tony as to the transfer in ownership and control of AVS GA from Peter to Tony in August to October 2006. The Commissioner submits this on two bases. Firstly, the transfer of business was not ordinary dealings in the course of commercial business activity. Secondly, the Commissioner contends that on the assessment of the overall credibility of Peter and Tony, neither should be believed about a fact in issue. 183In so far as the first of those bases, the Applicants submit that in August 2006 Peter gave AVS GA to Tony and on 21 October 2006 AVS GA obtained its current master licence. 184The Applicants also submit that in October 2006 Peter gave the business of AVS Australian Venue Security Pty Ltd ("AVS AVS") to AVS GA. The Applicants says that, thereafter, Peter ceased to be relevantly financially interested, empowered or positioned in AVS GA's business. 185As at 21 June 2006 Peter was a director and participated in executive and managerial decisions of the security business activity carried on under the licence of Tony for AVS AVS. Accordingly, he held a relevant position and exercised relevant power in the business of AVS AVS for which Tony was the nominee holder of the licence. 186The ASIC search suggests that on that that day he resigned as a director and disposed of the company to Raymond Saab. Notwithstanding his apparent lack of ownership and control of AVS AVS, Peter's evidence is that he gave the AVS-AVS Business to Tony in October 2006, and thereafter sold Australian Venue Security Pty Ltd to Raymond Saab. 187As at October 2006 Tony was a manager and executive, and as a consequence participated in managerial and executive decisions of AVS AVS. Accordingly, he held a relevant position and exercised relevant power in the business of AVS AVS. He had held that position since 2002. 188For approximately four years before October 2006 Peter and Tony shared the profits of AVS AVS, and regarded themselves as business partners. 189Both Peter and Tony had relevant financial interests in the AVS AVS business as at October 2006. As at October 2006 Peter was a close associate of Tony and AVS AVS. 190The Applicants submit that AVS GA was a valueless "shelf company", and the AVS AVS business was an asset of considerable but unquantified value. Peter and Tony explain the transaction as a family arrangement. In this regard, the Commissioner contends that by reason of the transaction having a family arrangement quality, it is attended by casual informality, and may attach all future dealings with the family relationship dynamics at the time of the transaction. 191There is no evidence of them being effected through a contract for the sale of business etc. the subject of warranties or adjustment for financial Liabilities or benefits. 192The Commissioner submits that there is a legal but rebuttable presumption that inter-family dealings are not intended to have contractual or at least legal consequences which normally attend a commercial transaction for consideration. 193In this case Peter and Tony each gave evidence of the intensity of the family relationships and the non-significance of their commercial forms. Peter's evidence is that his father charged him with responsibility for the welfare of his immediate family shortly before his father's death, and that he takes that responsibility very seriously. Tony's evidence is to the effect that "it doesn't matter whose name is on the title; it's a family asset". 194The Commissioner submits that the importance of the fact of the transaction of the business being within a family context is highlighted by the number of immediate and extended family members that work in the Jaken Business Centre. They are: George (brother) Rose Lenden (sister) Najette Michael (sister) Tony Michael (bras-in-law) Angela Siviero (neice) Daniel Siviero (neice's husband) Mandy Reid (Peter's ex-wife) Steve Reid (Mandy's current hsband) Roldo Yacoub (cousin) Joe Nasr (cousin) David Nassif (cousin) 195The Commissioner submits that the evidence suggests that no business independent of the Sleiman interests operates from Jaken Business Centre. The Commissioner contends that Peter's identification of Ultimate Computer Solutions as such an enterprise ought not to be accepted; ultimately he revealed it/Mr Fares was the (in house) supplier to the various Sleiman enterprises at Jaken Business Centre. 196The Commissioner relies on the considerable evidence of Peter dealing with family members in a business context. Australian Admin Services Pty Ltd is a corporation for which Tony and Angela Michael are or were once the directors which provides administrative and management services to AVS GC. The Commissioner contends that this is a business that was created by Peter. 197Further the Jaken Property Group Pty Ltd is ostensibly an independent business for which the director is Raymond Saab, and was previously Peter and Najette Michael. That business has its registered office at the premises of Jaken Business Centre at 17 Cowper Street, Granville. It is the trustee for the Sly Fox Family Trust. 198The Commissioner contends that the evidence suggests that Peter has a dominant position or at least leading role in the family and that the family business dealings is a measure relevant to the assessment of whether Peter wished to retain de facto control of the NSW business despite it disposition to Tony. If it is accepted that Peter would not have disposed of AVS GA outside the family, i.e. disposed of it commercially, it suggests that Peter did not wish to lose his NSW business to someone beyond his influence or control as it would hinder his commercial goal through AVS GC to operate nationally. 199The Commissioner contends that it is significant that in Tony's evidence in regard to the period from October 2006 to date he does not assert the occurrence of even one meeting (with or without an AVS GA manager) of himself with an AVS GA client; any contact between himself and the Police or any other regulatory agencies; ever inspecting client premises to see how his staff were performing; or convening even one staff meeting. 200The Commissioner submits that it is inherently improbable that the principal of a business would have not engaged in any such activity. The absence of such evidence as in 10.7 above suggests Tony was neither relevantly empowered nor relevantly positioned. It is further submitted that the inevitable consequence of that conclusion is that "... directorial managerial [and] ... executive decision ..." making authority in AVS GA Business resided other than in Tony. 201In contrast, the Commissioner has adduced evidence of Peter meeting with an AVS GA client; having contact with Police or other regulatory agencies and inspecting client premises to see how AVS GA staff were performing. 202The Commissioner contends that as Peter did engage in all of these activities, and the evidence does not suggest anyone else doing so, it may be supposed that after August/October 2006 Peter remained, as he had prior to that date, relevantly empowered and relevantly positioned in the business he had founded. 203The Commissioner submits that Tony was a witness on whom the Tribunal could not rely. He was ignorant of many matters, and his explanations of some matters were implausible to the point of being ludicrous. He submits that nothing in Tony's demeanour would cause the Tribunal to hesitate in reaching the conclusions for which he contended.

Submissions concerning the assessment of Tony's credit 204It is submitted for the Applicants that the Commissioner has not presented to the Tribunal a positive case upon which the Tribunal, acting rationally and fairly, could find that Peter is, or has at any material time been, a 'close associate' of the AVSGA business. 205It is further submitted that on the proper construction of section 5 of the Act, the Commissioner has probably not even established a prima facie case to answer on the question of 'close association'. 206The Applicants contend that even if it were proved that Tony is not to be believed on his oath, this would not assist the Tribunal in resolving a question about which Tony's account is supported by other evidence, and concerning which there is simply no evidence that would reasonably cause the Tribunal to doubt the truth of Tony's version of relevant events.

Consideration 207The Applicants have urged caution in regard to the weight given to material on which the Commissioner relies and particularly in regard to the material that has not been made available to the Applicants. Reference was made to the following observation made by Judicial Member Molony in Avilion Group Pty Ltd v Commissioner of Police, NSW Police [2010] NSWADT 129 ("Avilion GD") at paragraphs [47] - [48] about the material upon which the Commissioner relied in that matter: "47 ... much of the material is self-corroborating; with the result that, when one considers the weight of the underlying evidence, the whole house of cards collapses. This, in my view, is not evidence upon which the Tribunal could be satisfied to the Briginshaw standard. In that case Dixon CJ said: "... reasonable satisfaction is not a state of mind that is attained or established independently of the nature and consequence of the fact or facts to be proved. The seriousness of an allegation made, the inherent unlikelihood of an occurrence of a given description, or the gravity of the consequences flowing from a particular finding are considerations which must affect the answer to the question whether the issue has been proved to the reasonable satisfaction of the tribunal. In such matters "reasonable satisfaction" should not be produced by inexact proofs, indefinite testimony, or indirect inferences." 48 Among the considerable body of material submitted by the Commissioner there are, however, a number of pieces of evidence which are sufficiently reliable for the Tribunal to rely on when making findings of fact. 208In these proceedings I have had the assistance of Mr Higgins as Counsel Assisting the Tribunal. Mr Higgins has had access to the Commissioner's material and has made submissions in regard to that material. As a consequence of considerations at the interlocutory stages much of the Commissioner's material has been provided to the Applicants. In the circumstances I do not have the same concerns as those that Judicial Member Molony expressed.

Consideration of the Evidence 209When exercising discretion in relation to a licence it is necessary to keep in mind the activities that the person will be engaged in under the licence. In that regard, the objects and purposes of the Act are relevant i.e. the regulation of the security industry to maintain public safety and to ensure that those who are licensed to operate in the industry are appropriately qualified and persons of integrity: O'Neill v Commissioner of Police, NSW Police [2005] NSWADT 130. 210Several decision of this Tribunal have emphasized the view that the security industry has a special role in ensuring that public order is maintained, in safeguarding community assets and private property and in ensuring that the public and public venues are safe: Haining v Commissioner of Police [1999] NSWADT 6.

Is Peter a close associate? 211In my view, the evidence does not support the finding that Peter holds a relevant financial interest in the business of AVS GA within the meaning of section 5 of the Act. 212If the Appeal Panel decision in Avilion AP is correct, there is no basis on which the finding could be made that Peter "is or will be entitled to exercise any relevant power (whether in his or her own right or on behalf of any other person), in the business of the licence applicant or holder, and by virtue of that ... power is or will be able (in the opinion of the Commissioner) to exercise a significant influence over or with respect to the conduct of that business". The evidence does not support the finding that Peter is so entitled. 213While doubt has been raised in regard to the correctness of the Avilion AP decision, insofar as it relates to the construction to be give to the expression Peter "is or will be entitled to exercise any relevant power', this is not the forum in which to ventilate that issue. 214It is therefore necessary to determine the question of whether the evidence supports the finding that Peter holds or will hold any relevant position in the business of AVS GA. 215I have considered the evidence presented on behalf of the parties and their submissions in regard to the interpretation to be give to that evidence. 216A person is a close associate of an applicant under section 5 if that person holds a position of "director, manager, and other executive positions and secretary, however those positions are designated, and such other positions as may be prescribed by the regulations for the purposes of this definition." The Macquarie Dictionary On-Line defines "manager" - noun 1. someone who manages. 2. a person charged with the management or direction of an institution, a business or the like 217On Peter's and Tony's own evidence I am satisfied that Peter played an executive role in the business of AVS GA up until October 2006. As such he was a close associate within the meaning of section 5. 218Their evidence also supports the finding that Peter also played an executive role in the business at some time in at least 2007. I am satisfied that Peter was performing the role of a manager in the business. He made operational decisions as needed, liaised with and advised clients and dealt with the rostering of personnel. 219However, Peter and Tony both deny that Peter has performed an executive role in the business after that date. It is therefore necessary to consider the evidence presented on behalf of the Commissioner and determine whether or not Peter has continued to be a close associate of AVS GA. 220I agree with the Applicants that little weight can be given to the Operation Revocation evidence. In my view the explanation for how Peter came to be named as "Employer Contact person" that has been proffered on behalf of the Applicants is plausible. In the absence of direct evidence by Constable Graham in regard to how the Employer Contact details were obtained I do not consider that the evidence is of assistance. 221However, in my view significant weight should be given to the evidence concerning Peter's dealings with Dean Martin and Ralph Guderjan. I do not accept the Applicants' explanation of those dealings. I agree with the submissions made on behalf of the Commissioner in regard to the interpretation to be given to that evidence. 222When the evidence from routine police activity is considered along with that of Mr Martin and Mr Guderjan, it can be readily inferred that Peter has continued to play an executive role in the business of AVS GA. 223In my view Peter exercised executive authority in the business of AVS GA and he did so with Tony's approval - either tacit or explicit. Peter represented the interests of AVS GA at meetings with the regulator and discussed employing security guards. Tony never attended such meetings. Scott Taylor attended in an apparent subordinate capacity to Peter. Peter exercised managerial or controlling function over AVS GA in respect of the conduct of security activities concerning a number of venues and generally. 224It is probable that Peter was able to maintain that role because of his position in the family. I am satisfied that through that arrangement Peter was effectively charged with the management of the core business of AVS GA. Regardless of whether he was officially appointed to the position, he was a manager and the holder of an executive position in the business of AVS GA. As such he was a close associate within the meaning of section 5. 225I do not accept the evidence given by Peter and Tony to the effect that Peter no longer has any role with the AVS GA. In my opinion, Peter continues to be able to exercise a significant influence over and with respect to AVS GA's business, as he has in the past. 226I am satisfied that Tony is not a person with the ability or experience to manage the business of AVS GA. He has engaged the management skills of others to perform that role. The need for that assistance has allowed Peter's participation in the executive and managerial decisions of the business of AVS GA to continue. Despite Tony's assurances that he is operating the business free of the influence of Peter, I do not accept that this is the case. 227The inclusion of the words "holds or will hold any relevant position" in the section 5 definition of "close associate" suggests that the relevant time at which that finding must be reached is at the time of the decision. That is, to be a close associate Peter must hold a relevant position at the time the question of whether he is a close associate is determined or alternatively it must be found that he will hold such a position. 228I am satisfied that Peter held a relevant position in the business of AVS GA as at 2010. However, there is no evidence that Peter continues to carry out that role. For practical purposes where a person is found to hold a position de facto despite their denials of doing so, it would be rare case in which a finding that the person "holds or will hold" the relevant position at the time of the decision. Of necessity the finding must be one made by inference. 229In this matter, given my finding that Peter held a relevant position in the business of AVS GA as at 2010 and that I did not accept his denials that that was the case, any suggestion that Peter no longer holds a relevant position in the business of AVS GA lacks force. The inference must be drawn that that he continues to hold a relevant position and I therefore find as a fact that Peter holds a relevant position in the business of AVS GA. In my view he is a close associate within the meaning of section 5.

The Consequences of Peter being a close associate 230Tony has not notified the Commissioner that Peter is a close associate in the business of AVS GA. The failure to do so was a breach of a condition of the licence. If Peter had been declared as a close associate at the time the application for master licence was made, the effect of section 15(5) would have been to require the Commissioner to determine whether Peter was a fit and proper person to hold a master licence. If he were not a fit and proper person to hold the licence the Commissioner would have been required to refuse to grant the licence. 231Section 26(1A) of the Act provides that the Commissioner must revoke a licence if satisfied that, were the licensee applying for a new licence, the Act would require that the application be refused. If Peter has been and continues to be a close associate of the business of AVS GA and if he is not fit and proper to hold a master licence, the Commissioner is bound to revoke the master licence. 232[Not for publication]

Is Peter a fit and proper person to hold a master licence? 233In Avilion GD Molony JM considered a number of authorities that have dealt with the question of whether a person is fit and proper. He discussed the matter at paragraph [119] as follows: "119 In FD v Commissioner of Police, New South Wales Police [2008] NSWADT 88 at [46-54] I wrote: "The discretion vested in a decision maker in determining whether a person is fit and proper, in any given context, was said by the Full Court of the Federal Court in Commissioner for ACT Revenue v Alphaone Pty Ltd (1994) 49 FCR 589 at 389, per Northrop, Miles and French JJ, to "give wide scope for judgement and allow broad bases for rejection." See also Commissioner of Police v Toleafoa ([1999] NSWADTAP 9 at [25]. In the present context, additionally to these principles, s.15(6) of the SIA provides that "for the purpose of determining whether the Applicant is a fit and proper person" the Commissioner may have regard to criminal intelligence or information which, among other things, "causes the Commissioner not to have confidence that improper conduct will not occur if the applicant were granted the licence." The Act contains no definition of "improper conduct". Section 33 of the Interpretation Act 1987 ("the IA") says that: "In the interpretation of a provision of an Act or statutory rule, a construction that would promote the purpose or object underlying the Act or statutory rule (whether or not that purpose or object is expressly stated in the Act or statutory rule or, in the case of a statutory rule, in the Act under which the rule was made) shall be preferred to a construction that would not promote that purpose or object." S.34 of the IA then provides: "(1) In the interpretation of a provision of an Act or statutory rule, if any material not forming part of the Act or statutory rule is capable of assisting in the ascertainment of the meaning of the provision, consideration may be given to that material: (a) to confirm that the meaning of the provision is the ordinary meaning conveyed by the text of the provision (taking into account its context in the Act or statutory rule and the purpose or object underlying the Act or statutory rule and, in the case of a statutory rule, the purpose or object underlying the Act under which the rule was made), or (b) to determine the meaning of the provision: (i) if the provision is ambiguous or obscure, or (ii) if the ordinary meaning conveyed by the text of the provision (taking into account its context in the Act or statutory rule and the purpose or object underlying the Act or statutory rule and, in the case of a statutory rule, the purpose or object underlying the Act under which the rule was made) leads to a result that is manifestly absurd or is unreasonable." ... The Macquarie Dictionary contains the following definition of "improper"

• "not in accordance with propriety of behaviour, manners, etc .: improper conduct." On that understanding, the improper conduct to which s.15(6) refers is conduct in the course of the regulated activity or as a consequence of the grant of a licence. In FD's case, were he granted a licence, this would be as an unarmed guard of persons or property, or in crowd control. The purpose and object of the Act appear to be the maintenance of the highest standards of personal integrity and conduct in the carrying out of regulated security activities. What amounts to prospective improper conduct (having regard to criminal intelligence) in the context of such a licence, which the Commissioner is not confident will not occur, is a difficult question. Some guidance can be found from the Second Respondent Speech on the Security Industry Amendment Act 2002 - which, among other things, introduced s.15(6) and (7) to the SIA. Mr Gaudry, Parliamentary Secretary, in the Legislative Assembly on 12 November 2002, said: "The intention of the Security Industry Act is to ensure that high standards of integrity and conduct are maintained within the security industry. Entry to the industry is restricted by the licensing system in order to protect the public interest by diminishing the likelihood of criminal activity within the industry. For this reason, persons convicted of specified offences are barred from working in security. It is the view of NSW Police that persons who are known to have extensive links to organised crime figures, who are members of an outlaw motor cycle gang linked to organised crime, or who are suspected of offences relating to drug trafficking, murder or other violence offences, should be regarded as "not fit and proper" to hold a security licence. However, the determination of whether a person is "fit and proper" is contextual, as has been recognised in common law. For example, in Australian Broadcasting Tribunal v Bond , Justices Toohey and Gaudron found that: "The expression "fit and proper person" standing alone, carries no precise meaning. It takes its meaning from its context, from the activities in which the person is or will be engaged and the ends to be served by those activities. The concept of "fit and proper person" cannot be entirely divorced from the conduct of the person who is or will be engaging in those activities. However, depending on the nature of those activities, the question may be whether improper conduct has occurred, whether it is likely to occur, whether it can be assumed that it will not occur, or whether the general community will have confidence that it will not occur. The list is not exhaustive but it does indicate that, in certain contexts, character (because it provides indication of likely future conduct) or reputation (because it provides indication of public perception as to likely future conduct) may be sufficient to ground a finding that a person is not fit and proper to undertake the activities in question." The Deputy President of the Administrative Decisions Tribunal has also held that there should be some 'nexus' between the conduct complained of and the activities to which the licence relates. This would apply, for example, in the case of a security guard who is reported to be associated with criminals with convictions for the armed robbery of banks. It is therefore considered that there is insufficient direction within the Security Industry Act to ensure that the balance is maintained between the interests of public safety in ensuring a crime free security industry, and the interests of individual licence holders in retaining their licences to work within the industry. To this end, it is proposed to clarify the definition of "fit and proper person" in section 15 of the Act such that it can be clearly seen to include, but is not limited to, circumstances where:

1. In matter No. 093216 the decision under review is affirmed
2. In matter No. 093202 the decision under review is affirmed
3. The orders take effect 14 days after the date of this decision DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 11 January 2012