Firearms Act 1996
Cases Cited: Australian Broadcasting Tribunal v Bond [1990] HCA 33
Source
Original judgment source is linked above.
Catchwords
Explosives Act 2003Explosives Amendment Act 2013Explosives Regulation 2013Firearms Act 1996
Cases Cited: Australian Broadcasting Tribunal v Bond [1990] HCA 33
Judgment (24 paragraphs)
[1]
Solicitors:
Rothwell Lawyers Pty Ltd (Appellants)
Crown Solicitor's Office (Respondent)
File Number(s): AP 15/35205
Decision under appeal Court or tribunal: Civil and Administrative Tribunal
Jurisdiction: Administrative and Equal Opportunity Division
Citation: Boyle v WorkCover Authority of New South Wales [2015] NSWCATAD 90
Date of Decision: 05 May 2015
Before: J Lucy, Senior Member
File Number(s): 1410449
[2]
Introduction
This decision deals with appeals instituted by two Appellants, Bronze Wing Ammunition Pty Ltd ACN 145 457 263 (hereafter 'Bronze Wing') and Gregory Charles Boyle ('Mr Boyle'), from a decision of the Administrative and Equal Opportunity Division of the Tribunal.
In this decision, the Tribunal affirmed the cancellations of two licences under the Explosives Act 2003 ('the Act') held by Bronze Wing and a security clearance under the Act held by Mr Boyle.
The agency that effected these cancellations, namely the WorkCover Authority of New South Wales ('WorkCover'), is the Respondent to this appeal.
Following an internal review, which affirmed the cancellations, the Appellants commenced review proceedings in the Tribunal on 17 July 2014. The hearing of their applications took place before Senior Member Lucy on 17 and 18 November and 8 December 2014.
The decision by the Tribunal also affirming the cancellations, Boyle v WorkCover Authority of New South Wales [2015] NSWCATAD 90 ('the Tribunal's decision), was delivered on 5 May 2015. In the reasons that follow, we will use the letter 'J' to identify the numbered paragraphs of this decision.
On 28 May 2015, the Appellants filed a Notice of Appeal from the Tribunal's decision.
On 2 June 2015, an Appeal Panel granted a stay of the Tribunal's orders and directed that the hearing of the appeal be expedited.
Following the filing of outlines of submissions by the parties, the appeal was heard before us on 27 and 28 July 2015. Mr C McGrath SC appeared for the Appellants with Mr C Wood of counsel, and Mr H El Hage of counsel appeared for WorkCover. At the conclusion of the hearing, we reserved our decision.
[3]
Relevant facts
The following factual summary is an abridged and modified version of paragraphs J9 to J20. More detailed accounts of some aspects of the Tribunal's findings appear later in these reasons.
Bronze Wing held two licences issued by WorkCover, a licence to manufacture explosives and a licence to import/export explosives. The business address for both licences, being the premises at which Bronze Wing manufactured ammunition, was Doug McWilliams Road, Yenda ('the Premises').
Under the Act, a corporation is required to have a 'responsible person' (sometimes referred to as a 'nominated person') in order to be eligible to hold a licence. A 'responsible person' must be an individual holding a security clearance. The responsible person for both of Bronze Wing's licences was Mr Boyle, who held a security clearance at all relevant times.
From 19 February 2010 until 28 May 2014, Mr Marcello Casella was both the sole director and the sole shareholder of Bronze Wing. Mr Casella was also involved in the management and ownership of Casella Wines Pty Ltd ("Casella Wines") and Casella Management Pty Ltd ("Casella Management").
Casella Management owned a property in Barracks Road, Yenda ('Barracks Road'). These premises were warehouse/factory type premises. At times, ammunition that Bronze Wing had sold was packaged and/or stored at Barracks Road.
Casella Management also owned a property in Wood Road, Yenda ('Wood Road'). This property was a farm and residential property.
On 12 February 2014, NSW Police officers executed a search warrant at Wood Road. Police found and seized approximately five tonnes of ammunition and 86 kilograms of explosive propellant.
On 13 February 2014, NSW Police officers executed a search warrant at Barracks Road. During this search, police officers saw two individuals packaging and unloading pallets of shotgun shells. Those individuals did not hold security clearances.
On 27 February 2014, a delegate for the Commissioner of Police wrote to Bronze Wing advising that its 'Purchase / Sell' permit under the Firearms Act 1996 had been revoked.
On 6 March 2014, NSW Police charged Mr Casella with offences arising under the Firearms Act, the Act and the Explosives Regulation 2013 ('the Regulation').
On 18 March 2014, WorkCover advised Mr Boyle by letter that it had decided to cancel Bronze Wing's licence to manufacture and its licence to import, and to cancel Mr Boyle's security clearance.
Bronze Wing and Mr Boyle sought an internal review of WorkCover's decisions. In the resulting determination, dated 13 June 2014 ('the Internal Review decision'), those decisions were affirmed.
The grounds for the revocation of Bronze Wing's permit under the Firearms Act, the cancellation of its licences under the Act, the cancellation of Mr Boyle's security clearance and the affirmation of these cancellations in the Internal Review decision are outlined below.
On 27 May 2014, Ms Tracey Rothwell was appointed as a director of Bronze Wing and, on 28 May 2014, Mr Casella resigned his directorship.
Bronze Wing and Mr Boyle applied to the Tribunal on 14 July 2014 for a review of WorkCover's decisions. They sought orders setting aside those decisions and reinstating Mr Boyle's security clearance and Bronze Wing's licences.
The Tribunal granted a stay of WorkCover's decisions on 25 August 2014, on condition that WorkCover was satisfied that the Appellants were operating in compliance with the applicable legislation. It was contemplated that WorkCover would conduct an audit of Bronze Wing to determine whether it could reach that state of satisfaction.
On 28 August 2014, Mr Casella transferred all of his shares in Bronze Wing to Rothcock Pastoral Company Pty Ltd. Ms Rothwell is the sole shareholder and director of Rothcock Pastoral Company Pty Ltd.
On 1 October 2014, Inspector Brooks and Senior Inspector Howie of WorkCover attended Bronze Wing's manufacturing plant to conduct an audit. Notwithstanding the stay, Bronze Wing was not at this time manufacturing. Following the inspection, WorkCover issued certain directions to the Appellants.
On 2 October 2014, the condition of the stay was lifted until 17 October 2014. On 17 October 2014, WorkCover did not contest the continuation of the unconditional stay until the final hearing of the matter. This stay was, in effect, continued by the Appeal Panel's order on 2 June 2015.
As already indicated, the Tribunal's decision, given on 5 May 2015, affirmed WorkCover's cancellations of Bronze Wing's licences and Mr Boyle's security clearance. The findings on which it based this decision were that Bronze Wing was no longer a fit and proper person to hold a licence under the Act and Mr Boyle was no longer a fit and proper person to hold a security clearance. The provision on which it relied was s 21(b) of the Act. As indicated below, the previous cancellations, by WorkCover and in the Internal Review decision, referred to other grounds.
The reasons that the Tribunal gave for its decision are quoted or summarised, to the extent required for present purposes, in the ensuing discussion of the matters raised in the Notice of Appeal.
[4]
Relevant legislation
Numerous provisions of the Act and the Regulation were quoted or referred to in the Tribunal's decision and/or in the parties' submissions in the appeal.
These included the following provisions of the Act:
3 Definitions
(1) In this Act:
handling includes the activities of conveying, manufacturing, processing, possessing, using, preparing for use, treating, dispensing, storing, packing, selling, supplying, importing into the State from another country, rendering harmless, abandoning, destroying and disposing.
6 Licences required for handling explosives and explosive precursors
(1) A person must not handle an explosive or explosive precursor if:
(a) the regulations require the handling to be authorised by a licence under this Act, and
(b) the person is not authorised to do so by a licence under this Act.
Maximum penalty:
(a) in the case of a corporation - 500 penalty units, or
(b) in the case of an individual - 250 penalty units or imprisonment for 12 months, or both.
Note. An offence against subsection (1) committed by a corporation is an executive liability offence attracting executive liability for a director or other person involved in the management of the corporation - see section 33.
(2) Without limiting subsection (1) (a), the regulations may require licensing by reference to the following:
(a) the class or type of explosive or explosive precursor,
(b) the kind of handling of the explosive or explosive precursor,
(c) the circumstances of the handling of the explosive or explosive precursor.
6A Security clearance must be held in certain circumstances
A natural person must not handle any explosive or explosive precursor if:
(a) the regulations require the person to hold a security clearance that is in force when handling the explosive or explosive precursor, and
(b) the person does not hold a security clearance to handle the explosive or explosive precursor concerned.
Maximum penalty: 250 penalty units.
10 Licences may be granted under this Act
(1) Licences authorising the carrying out of an activity that constitutes handling an explosive or explosive precursor may be granted and otherwise dealt with in accordance with this Part.
(2) Licences may be granted or varied so as to cover one or more activities involving explosives or explosive precursors.
10A Security clearance a prerequisite to obtaining licence
(1) A natural person is not eligible for a licence unless the person has been granted a security clearance that is in force.
(2) A corporation is not eligible for a licence unless there is at least one responsible person for that corporation who has been granted a security clearance that is in force.
14 Conditions of licences and security clearances
(1) Licences and security clearances may be granted unconditionally or subject to conditions.
(2) After granting a licence or security clearance, the regulatory authority may, by notice in writing to the holder of the licence or security clearance:
(a) impose conditions or further conditions on the licence or security clearance, or
(b) vary or revoke any of the conditions to which the licence or security clearance is subject.
(3) A licence or security clearance is also subject to such conditions as are prescribed by the regulations. Any such prescribed condition cannot be varied or revoked by the regulatory authority under this section.
(4) A condition to which a licence is subject under this section may restrict or limit an activity authorised by the licence.
15 Offence to contravene conditions of licence or security clearance
The holder of a licence or security clearance must not contravene any condition to which the licence or security clearance is subject.
Maximum penalty: 50 penalty units.
21 Cancellation of licences and security clearances
The regulatory authority may cancel a licence or security clearance:
(a) if the holder of the licence or security clearance:
(i) is convicted of or found guilty of an offence against this Act or the regulations or a provision of a corresponding Act or regulation of the Commonwealth or of another State or Territory relating to explosives, or
(ii) breaches a condition of the licence or security clearance, or
(iii) surrenders the licence or security clearance to the regulatory authority, or
(iv) supplied information which was (to the holder's knowledge) false or misleading in a material particular in, or in connection with, the application for the licence or security clearance, or
(b) if the regulatory authority is of the opinion that the holder is no longer a fit and proper person to hold, or to continue to hold, the licence or security clearance, or
(c) for any other reason prescribed by the regulations.
24 Administrative review of decisions by Civil and Administrative Tribunal
(1) A person who is aggrieved with a decision under this Act or the regulations relating to a licence or security clearance may apply to the Civil and Administrative Tribunal for an administrative review under the Administrative Decisions Review Act 1997 of the decision.
33 Liability of directors etc for offences by corporation - offences attracting executive liability
(1) For the purposes of this section, an executive liability offence is an offence against any of the following provisions of this Act that is committed by a corporation:
section 6 (1)
(2) A person commits an offence against this section if:
(a) a corporation commits an executive liability offence, and
(b) the person is:
(i) a director of the corporation, or
(ii) an individual who is involved in the management of the corporation and who is in a position to influence the conduct of the corporation in relation to the commission of the executive liability offence, and
(c) the person:
(i) knows or ought reasonably to know that the executive liability offence (or an offence of the same type) would be or is being committed, and
(ii) fails to take all reasonable steps to prevent or stop the commission of that offence.
Maximum penalty: The maximum penalty for the executive liability offence if committed by an individual.
A matter of relevance is that s 6 falls within Part 2 of the Act.
The following provisions of the Regulation were among those quoted or referred to in the Tribunal's decision and/or in the parties' submissions in the appeal:
17 Activities requiring licences
A person handling an explosive or explosive precursor must be authorised to do so by a licence granted by the regulatory authority under the Act.
18 Natural person must hold security clearance
(1) A licence granted to a natural person authorises the person to handle explosives or explosive precursors in the manner authorised by the licence only while the person holds a security clearance that is in force.
(2) It is a condition of a licence granted to a natural person that the licence holder holds a security clearance that is in force.
19 Corporation must nominate natural person to hold security clearance
(1) A licence granted to a corporation authorises the corporation to handle explosives or explosive precursors in the manner authorised by the licence only while there is at least one responsible person for the corporation.
(2) It is a condition of a licence granted to a corporation that there is at least one responsible person for the corporation.
(3) A responsible person for a corporation is a natural person nominated by the corporation, in accordance with this clause, to be responsible for the activities authorised by the licence.
(4) A responsible person for a corporation must be a natural person who:
(a) is at least 18 years old, and
(b) is concerned in the management of the corporation, and
(c) holds a security clearance that is in force, and
(d) has satisfied the corporation that the person has the relevant knowledge, experience and qualifications to supervise the activities authorised by the licence, and
(e) consents to the nomination.
(5) A responsible person is to be nominated by a corporation in its application for a licence.
(6) A corporation that holds a licence may at any time, by notice in writing to the regulatory authority, nominate a natural person to be a responsible person instead of or in addition to a person previously nominated.
(7) The regulatory authority may require the corporation to provide evidence that a proposed responsible person has the relevant knowledge, experience and qualifications to carry out the activities authorised by the licence before granting the corporation a licence.
(8) The regulatory authority may decline to accept a nomination if it is not satisfied that the person nominated has the relevant knowledge, experience and qualifications to carry out the activities authorised by the licence.
20 Authority conferred by licence extends to other relevant persons
(1) A licence is taken to authorise any person to handle explosives or explosive precursors in the same way as the licence holder is authorised to handle them by the licence, but only if the person:
(a) is a natural person, and
(b) handles the explosives or explosive precursors in the course of his or her employment by the licence holder or under the immediate supervision of a person employed or engaged by the licence holder to supervise the person, and
(c) holds a security clearance that is in force or is acting under the immediate supervision of a person who holds a security clearance that is in force.
(2) This clause is subject to any restrictions or further requirements specified in the licence or in this Regulation.
(3) In this clause:
employment includes an engagement or other arrangement, whether or not constituting a contract of employment.
22 Licence to manufacture
A licence to manufacture authorises the licence holder to carry out the following activities:…
(g) if premises are specified in the licence - storing the explosives or explosive precursors at the premises.
23 Licence to import
(1) A licence to import authorises the licence holder to import the explosives or explosive precursors specified in the licence into the State from another country.
(2) A licence to import also authorises a person to carry out the following activities for the purpose of importing explosives:…
(c) if premises are specified in the licence - storing the explosives or explosive precursors at the premises.
35 Security plan
(1) An applicant for a licence must, if required to do so by the regulatory authority, submit a security plan in relation to the explosives or explosive precursors that are to be handled under the licence.
(2) Any security plan must contain the following:
(a) details of the facilities, systems and procedures in place for the safe and secure handling of the explosives or explosive precursors concerned…
45 Transport of explosives by police officers
A police officer is not required to hold a security clearance or licence to transport by vehicle or vessel any explosives or explosive precursors that have been confiscated or received by, and are under the immediate supervision of, the police officer.
48 Ammunition
(2) A person who holds a licence or a permit under the Firearms Act 1996 (other than a firearms collector licence) that authorises the person to possess or use a firearm is not required to be authorised by a licence in order to possess, use, store or transport:
(a) ammunition, or
(b) percussion caps, or
(c) not more than 12 kg of propellant powder.
70 Compliance with security plan
A licence holder must ensure that:
(a) the requirements of, and procedures specified in, the licence holder's security plan are observed, and
(b) all activities under the licence are undertaken in accordance with the security plan.
Maximum penalty: 250 penalty units.
In cl 5(1) of the Regulation, 'explosive precursors' are defined 'security sensitive dangerous substances'. Both in the Tribunal's decision and in the parties' submissions, this term was frequently used in conjunction with 'explosives'. For convenience, we frequently treat the word 'explosive' as including 'explosive precursor'.
Subsections (3) and (4) of s 65 of the Firearms Act should also be quoted. These state:
65 Supply, acquisition and possession of ammunition
(3) A person must not possess ammunition unless the person:
(a) is the holder of a licence or permit for a firearm which takes that ammunition, or
(b) is authorised to possess it by a permit.
(4) A person is not guilty of an offence under subsection (3) only because of possessing ammunition that is being conveyed or stored in the ordinary course of the person's duties in the business of a carrier or warehouse operator.
[5]
The grounds of this appeal
The Notice of Appeal filed by the Appellants set out ten Grounds of Appeal. In all but one of them (Ground 8), it alleged an error of law. In Ground 8 and in some of the other Grounds, it alleged that the Tribunal had 'erred in fact' in making specified findings.
Under s 80(2) of the Civil and Administrative Tribunal Act 2013, an appellant challenging a decision of the Tribunal may appeal as of right on a question of law, but requires the leave of the Appeal Panel in order to prosecute the appeal 'on any other grounds'. At the commencement of the hearing of this appeal, we indicated to the parties that our initial focus would be on the errors of law alleged in the Notice of Appeal.
Except for commencing with Ground 6, which alleges legal errors of a procedural and evidentiary nature, we will treat the Grounds of Appeal in the order in which they appeared in the Notice.
[6]
Ground 6: denial of procedural fairness and failure to apply the correct standard of proof
Ground 6 of the Notice of Appeal was in the following terms:
6. The Tribunal erred in law in taking into account matters not considered by the Respondent in making the decisions under review, namely that Bronze Wing Ammunition Pty Ltd allegedly had committed criminal offences under the Act:
a) without first giving due notice to the Appellants and affording them procedural fairness.
b) without applying to the consideration of those matters the standard of proof stipulated in Briginshaw v Briginshaw (1938) 60 CLR 336.
An additional claim of denial of procedural fairness, raised at the appeal hearing, related to a finding claimed to have been made by the Tribunal that Ms Rothwell, the current sole director of Bronze Wing, was not a fit and proper person to hold a licence under the Act.
Although put forward by the Appellants as one ground of appeal, these are in fact two distinct grounds. We shall deal with separately. But before we commence this task, we will describe aspects of the Tribunal's decision and of events preceding that decision which are relevant to both of these grounds.
[7]
The Tribunal's findings of contraventions of the Act or the Regulation
The primary focus of both of these claims of procedural error is the outcome of the Tribunal's findings that Bronze Wing had contravened provisions of the Act and the Regulation, under which a criminal penalty was attached to any contravention.
It is useful at this stage to set out in summary form the Tribunal's findings of contraventions by Bronze Wing of the Act or the Regulations. We will also outline its findings on the question whether Mr Boyle authorised or knew of the relevant conduct by Bronze Wing.
It is important to recall here that these findings were not in themselves the grounds on which the Tribunal affirmed the cancellation of the Appellants' licences. Instead, they operated, along with other factors, as reasons why the Tribunal concluded that Bronze Wing was not a fit and proper person to hold licences under the Act and Mr Boyle was not a fit and proper person to hold a security clearance under the Act. It was on this ground of lack of fitness and propriety, not the commission of any criminal offences, that the Tribunal affirmed the cancellation of the Appellants' licences and security clearance under s 21(b) of the Act.
The Tribunal made the following findings as to (a) contraventions of the Act by Bronze Wing and (b) Mr Boyle's authorisation or knowledge of these contraventions:
1. At J94, J95: With Mr Boyle's authorisation, Bronze Wing stored ammunition at Barracks Road, without being authorised to do so by its manufacturing licence or its import/export licence. By virtue of cll 17, 22(g) and 23(1)(c) of the Regulation and the definition of 'handling' in s 3 of the Act, this constituted a criminal offence under s 6(1) of the Act. Bronze Wing could not avoid liability by invoking cl 48 of the Regulation.
2. At J101: To the knowledge of Mr Boyle, Bronze Wing stored ammunition in shipping containers at the Premises. Through so doing, it failed to ensure that the requirements of its security plan were observed and that all actions taken under its licences were undertaken in accordance with this plan. This constituted a criminal offence under cl 70 of the Regulation.
3. At J108, J154: With the authorisation of Mr Casella (who was then the sole director), but without Mr Boyle being aware, Bronze Wing stored ammunition at Wood Road. By virtue of cll 17, 22(g) and 23(1)(c) of the Regulation and the definition of 'handling' in s 3 of the Act, this constituted a criminal offence under s 6(1) of the Act. Bronze Wing could not avoid liability by invoking cl 48 of the Regulation.
4. At J117, J118: on behalf of Bronze Wing and pursuant to authorisation by Mr Boyle, employees of Casella Management transported ammunition manufactured by Bronze Wing from the Premises to Barracks Road and packed such ammunition, without having a security clearance or being directly supervised by a person with such a clearance. These activities constituted a criminal offence, committed by Bronze Wing, under s 6(1) of the Act (see too cl 17 of the Regulation and the definition of 'handling' in s 3 of the Act). Bronze Wing could not avoid liability by invoking s 65(4) of the Firearms Act, cl 20, 45 or 48 of the Regulation, or the Australian Code of Transport of Explosives by Road and Rail.
[8]
Notifications to the Appellants as to the grounds of cancellation on which WorkCover and the Tribunal based their decisions
The two propositions on which the Appellants principally based their claim of denial of procedural fairness were as follows. First, it was not until they received WorkCover's final submissions - i.e. after the hearing before the Tribunal had come to an end - that they were given any notice at all of the 'nature' of the offence(s) under s 6(1) of the Act that Bronze Wing was found by the Tribunal to have committed. Secondly, given the serious nature of such offences, there should have been advance formulation and articulation of the 'charges' being made against Bronze Wing, together with sufficient particularisation of these 'charges' to enable it to meet them by evidence and argument. Because these were not provided, the Tribunal's approach was 'inquisitorial'.
As already noted, a further claim of procedural unfairness was made by Mr McGrath in oral submissions at the hearing of the appeal. This was that the Appellants had no advance notice of any claim by WorkCover that in seeking to challenge the fitness and propriety of Ms Rothwell, Bronze Wing's sole director since 25 May 2014, to hold a licence under the Act, it would contend that she had insufficient familiarity with the provisions of the Act and the Regulation.
We will commence our consideration of this part of the appeal by briefly outlining the notifications that the Appellants received of the grounds on which their licences and security clearance were cancelled.
In its Notice dated 27 February 2014 revoking Bronze Wing's Purchase and Sell Ammunition Permit under the Firearms Act, NSW Police stated that it was satisfied that it would no longer be in the public interest for Bronze Wing to hold such a permit. The reasons given in the Notice were that Bronze Wing had stored ammunition at a 'separate location' (Barracks Road) in breach of its 'authority and conditions' and that 'unauthorised persons' - namely, Mr Mancinelli and Mr Veit, who were both employees of Casella Management - were 'performing tasks, in an employee capacity, relating to possession of the ammunition'.
In its letter of 18 March 2014 to Mr Boyle advising of the cancellations of Bronze Wing's licences and of Mr Boyle's security clearance under the Act, WorkCover stated that the ground of the cancellations, provided for in s 21 of the Act, was that they had been 'in breach of the General explosive licence and security clearance conditions under the NSW Explosive Act and Regulation'.
In the Internal Review decision, dated 13 June 2014, a number of matters said to have been 'noted by the reviewer' included the following: (a) the matters set out in the Notice by NSW Police revoking Bronze Wing's Purchase and Sell Ammunition Permit; (b) a 'recommendation' from an officer of NSW Police that because Bronze Wing had no permit to have or possess ammunition, it could not have a licence to manufacture this form of product; (c) the discovery by NSW Police of ammunition being stored at Wood Road; (d) a statement by NSW Police that it did not believe Bronze Wing and Mr Boyle to be 'fit and proper entities to hold any licences or permits issued by WorkCover NSW'; and (e) the fact that when Mr Mancinelli and Mr Veit were handling ammunition at Barracks Road, they did not have security clearance and were not under the immediate supervision of a person with such a clearance.
The grounds on which the Internal Review decision affirmed WorkCover's cancellation of Bronze Wing's licences were these: (i) by storing explosives 'at separate locations to the site of storage stated on the licence', Bronze Wing 'did not comply with the licensing conditions of its Licence to manufacture as per clause 22 of the Explosives Regulation 2013'; and (ii) its failure to comply with cll 9 and 10 of the Regulation, 'given that John Mancinelli and Christian Veit did not hold a WorkCover NSW 'Security clearance' to handle explosives'. Reference was also made to cl 20.
The Internal Review decision affirmed the cancellation of Mr Boyle's security clearance on the ground of failure to comply with cll 9, 10 and 101 of the Regulation. (Cll 9 and 10 are to much the same effect as cll 17 and 20 and cl 101 makes it an offence to allow a person who has no security clearance to have unsupervised access to an explosive.) The Internal Review decision observed that under cl 19(3), Mr Boyle was 'responsible for' the activities authorised by the two licences to Bronze Wing and stated, with reference explicitly to cl 101, that 'Mr Boyle did not exercise his responsibility at least in the instances reported to WorkCover NSW by NSW Police'.
WorkCover filed and served submissions (WorkCover's 'first submissions') on 23 October 2014, about three weeks before the Tribunal hearing commenced. These submissions commenced with an Introduction and a summary, under the heading 'Factual Background', of the events that we have just outlined. Reference was then made to Part 2 of the Act and to the provisions, both within Part 3 and in the Regulation, that relate to the granting, the scope and the cancellation of licences and security clearances. The passage referring to Part 2 (para 17) was in the following terms:
Part 2 of the Explosives Act, read with cll 9, 17 and 18 of the Explosives Regulations, makes it an offence for a person to handle an explosive or an explosive precursor without a licence, and makes it an offence to handle an explosive or an explosive precursor without a security clearance. 'Handling' is defined very broadly to 'include' a large number of activities including conveying, manufacturing, processing, possessing, storing, importing into the State from another country and packing.
After referring to certain provisions of the Firearms Act, WorkCover's first submissions then advanced the claim that the 'correct and preferable decision' by the Tribunal was to cancel Bronze Wing's Licences under ss 21(a)(ii) and 21(b) of the Act, on three grounds. The first two of them, which the Tribunal subsequently rejected, were that Bronze Wing had breached a condition attaching to its Licence to Manufacturing and a further condition attaching to both its Licences. The third ground, which the Tribunal endorsed, was that Bronze Wing was no longer a fit and proper person to hold the Licences.
A number of claims made about Bronze Wing's conduct in support of the third ground included the following (at paras 31 to 35, 37 and 38 of WorkCover's first submissions):
1. 'Repeatedly' and 'over some period of time', Bronze Wing had stored 'large quantities' of explosives that it had manufactured at Barrack Road and Wood Road. Since these locations were not specified on its Licence to Manufacture, it thereby contravened 'the condition in cl 22(g) of the Explosives Regulation'. Its conduct in this regard was 'dangerous'.
2. Mr Mancinelli and Mr Veit had been 'found handling (packaging and unloading)' ammunition at Barracks Road even though they did not have security clearances and were not under the immediate supervision of a person who had a security clearance. 'As already noted', the submissions stated at this point, 'Pt 2 of the Explosives Act makes it an offence to handle explosives without a security clearance'. Bronze Wing had therefore been in breach of cl 20(1) of the Regulation. Its breach was 'compounded' by the fact that these two men were handling explosives 'on a site that had been used for (unauthorised) storage of explosives'.
3. The 'relevant contextual matters' included the following (set out as para 35(B) of the submissions):
Under the Act, there are strict prohibitions on the handling of explosives without a valid security clearance and in the absence of an applicable, valid licence. Parliament has provided for significant penalties to be imposed against persons who violate those prohibitions, including imprisonment for up to 12 months where a natural person handles explosives in the absence of a valid licence: see ss. 6 and 6A of the Explosives Act.
1. Bronze Wing had 'acted dishonestly and without regard to the law by storing large amounts of explosives' at Barracks Road and Woods Road, 'repeatedly and over a period of time'. This conduct was 'a risk to public safety and dangerous'. In addition, Bronze Wing had 'acted with disregard of the law' by not ensuring that Mr Mancinelli and Mr Veit had security clearances 'before handling any explosives', or that they 'acted under the supervision of a person with security clearance'. (The passages quoted are to be found in para 37 of WorkCover's first submissions).
In para 40 of WorkCover's first submissions, the following matters were relied on in support of its contention that Mr Boyle was no longer a fit and proper person to hold a security clearance: (a) the conduct of Bronze Wing on which WorkCover relied in submitting that Bronze Wing was not a fit and proper person to hold its Licences; (b) the fact that this conduct occurred while Mr Boyle was the 'responsible person' under the Act; (c) the fact that 'at all relevant times, he was aware of (and probably sanctioned) the unauthorised storage of explosives' at Barracks Road and Wood Road; and (d) the fact that he did not alert WorkCover to Bronze Wing's unauthorised conduct or attempt to rectify such conduct.
It will be noted that nowhere in these contentions, or indeed in any part of WorkCover's first submissions, was there any reference to Ms Rothwell.
Near the commencement of the Tribunal hearing, which took place on 17 November, 18 November and 8 December 2014, the parties' representatives made brief opening submissions. In outlining the case against Bronze Wing, Mr El Hage did not refer to s 6 or s 6A of the Act, or indeed to Part 2. He did, however, foreshadow (see Transcript, 17.11.14, p 30, lines 25-27) a submission that 'the legislation' requires a natural person 'to have a security clearance before they're able to handle explosives'. Mr El Hage also indicated (Transcript, 17.11.14, p 32, lines 9-17) that, according to WorkCover's case, (a) persons handling Bronze Wing's explosives at Barracks Road did not have a security clearance; (b) they were not supervised by a person with such a clearance; (c) these matters constituted breaches of cl 20(1) of the Regulation; (d) WorkCover had 'a power to cancel the licences… because of these breaches'; and (e) the breaches also signified that Bronze Wing was not a fit and proper person to hold a licence, furnishing 'an added basis for cancelling the licences'.
On 18 November 2014, the second day of the Tribunal hearing, it was suggested by Senior Member Lucy that the Tribunal should have 'some information' about Ms Rothwell because it would be relevant when applying the 'fit and proper person test' (see Transcript, p 130, lines 20-23).
Ms Rothwell filed an affidavit on 27 November 2014 outlining relevant aspects of her character, reputation and conduct. It included the statement that she was 'reasonably familiar with the requirements for storage of firearms and ammunition, the two being required to be stored separately'. On the final day of hearing (8 December 2014), this affidavit was tendered and she was cross-examined. During this cross-examination, she was various questions about this statement.
At the conclusion of the hearing, Tribunal did not receive oral submissions, but instead gave directions for the filing of written submissions. On 6 February 2015, pursuant to these directions, WorkCover filed its 'Final Submissions in Chief'. It stated in para 1 that these submissions replaced its first submissions.
The following passages in WorkCover's final submissions had no equivalents in its first submissions:
1. A brief passage (para 23) explaining the effect of cl 22(g) of the Regulations.
2. Extracts, at para 24, of cll 35 and 36 of the Regulations. The former clause (set out above) requires applicants for licences under the Act to submit a security plan. The latter requires the submission of a safety management plan.
3. Assertions as follows at paras 45B and 46: (a) Bronze Wing, in contravention of cl 22(g) of the Regulation and of its own security plan, repeatedly stored ammunition in shipping containers at its own premises during a period of two years; (b) in 'at least some instances', ammunition remained in a container 'for days'; (c) although aware of this practice, Mr Boyle did not inform WorkCover about it; and (d) shipping containers were never identified in the security plan submitted by Bronze Wing.
4. A passage (at para 55) adding the following three reasons why Bronze Wing was claimed not to be a fit and proper person to hold a licence: (a) Mr Boyle, who had been and remained Bronze Wing's nominated 'responsible person' in relation to its licences, was aware of Bronze Wing's conduct in disregard of the law, but 'elected not to inform WorkCover'; (b) Ms Rothwell, who was the current sole director and (in effect) sole shareholder of Bronze Wing, did not address the matter of its conduct in her evidence, did not acknowledge its past breaches and gave no evidence that would satisfy the Tribunal that they would not be repeated; and (c) in light of evidence from Mr Boyle and Ms Rothwell that they did not have 'proper familiarity' with the Act and the Regulation, the Tribunal could not be confident that these breaches would not be repeated.
Workcover's references in its final submissions to Part 2 of the Act, and to ss 6 and 6A, were in the same terms as in its first submissions.
[9]
The Appellants' submissions on procedural unfairness
Mr McGrath's oral submissions to us included the proposition that the only grounds of cancellation of Bronze Wing's licences that were communicated to the Appellants before or during the Tribunal hearing were those stated in the Internal Review decision. He took these to be the two grounds set out above at [51] and also a ground which (on one reading, at least) were mentioned rather than stated explicitly in the Internal Review decision. This was that Mr Boyle was not a fit and proper person to hold a security clearance under the Act.
Mr McGrath appeared also to agree, however, with the Tribunal's formulation of the grounds relied on by WorkCover. These were stated as follows in its decision at [36]:
36 The respondent contends that the correct and preferable decision is to affirm the cancellation of Bronze Wing's licences on one or both of the following bases:
(1) Bronze Wing breached a condition of the licence (Explosives Act 2003, s 21(a)(ii))
(2) the Tribunal is of the opinion that Bronze Wing is no longer a "fit and proper person" to hold, or to continue to hold, the licences (Explosives Act 2003, s 21(b))
The difference between these two formulations put by Mr McGrath is not material because the point that he emphasised was that neither of them mentioned breaches of s 6(1) of the Act by Bronze Wing. As already indicated, it was not, he maintained, until the Appellants received WorkCover's final submissions that they were given any notice at all of the 'nature' of the offence(s) under s 6(1) that Bronze Wing was found by the Tribunal to have committed. This had the consequence that at the Tribunal hearing Bronze Wing did not adduce evidence or argument on the question whether it had committed any such offences. Yet the Tribunal made three findings of contravention of s 6(1) by Bronze Wing: namely, the findings noted above at subparagraphs (1), (3) and (4) of paragraph [45]. Through so doing, it denied them procedural fairness.
This breach of the principle of natural justice, Mr McGrath submitted, was particularly serious because the offence created by s 6(1) is far from trivial. The maximum penalties are 500 penalty units, in the case of a corporation, and 250 penalty units or imprisonment for 6 months or both, in the case of an individual. In addition, the offence is designated as an 'executive liability offence' under s 33. This has the consequence that a director of a corporation which has committed the offence, and any other individual relevantly involved in the management of the corporation, may also be prosecuted for it.
By contrast, the offence created by cl 70 of the Regulation (being an offence which the Tribunal also found to have been committed by Bronze Wing - see paragraph [45] above at subparagraph (2)) is not an 'executive liability offence' and its maximum penalty is 250 penalty units without the alternative of imprisonment.
Because the offence created by s 6(1) was of such significance, Mr McGrath argued, it was essential that Bronze Wing should have full and detailed particulars of every 'charge' made against it under this provision. But particulars of this nature were never communicated to it.
In this context, Mr McGrath cited the High Court's decision in Kirk v Industrial Commission [2010] HCA 1 as authority for the proposition that where particulars are lacking, there is no 'charge'. He did not refer us to any part of the judgments in this case, but the following passage in the principal judgment seems apposite:
26 The common law requires that a defendant is entitled to be told not only of the legal nature of the offence with which he or she is charged, but also of the particular act, matter or thing alleged as the foundation of the charge. In John L Pty Ltd v Attorney-General (NSW), it was explained that the older cases established that an information could be quashed as insufficient in law if it failed to inform the justices of both the nature of the offence and the manner in which it had been committed. In more recent times the rationale of that requirement has been seen as lying in the necessity of informing the court of the identity of the offence with which it is required to deal and in providing the accused with the substance of the charge which he or she is called upon to meet. The common law requirement is that an information, or an application containing a statement of offences, "must at the least condescend to identifying the essential factual ingredients of the actual offence". These facts need not be as extensive as those which a defendant might obtain on an application for particulars. In Johnson v Miller, Dixon J considered that an information must specify "the time, place and manner of the defendant's acts or omissions". McTiernan J referred to the requirements of "fair information and reasonable particularity as to the nature of the offence charged".
A further consequence, according to Mr McGrath, of WorkCover's failure to provide notification, with adequate particulars, of its 'charge' of criminal liability under s 6(1) was that Bronze Wing did not realise that the case against it included a claim that when depositing at Barracks Road packages of sold ammunition that was in transit to customers it was 'storing' this ammunition within the meaning of s 3 of the Act. Consequently, it did not appreciate the importance, when presenting its case to the Tribunal, of adducing evidence as to the terms on which Casella Management received this ammunition from it and making submissions as to the meaning of the term 'storing'.
Mr McGrath's oral submissions on this matter included the observation that in the Tribunal's reasons, the passages that came closest to proper formulations of 'charges' against Bronze Wing under s 6(1) of the Act were to be found at J78, J79, J84 and J95. For reasons explained below, it is not necessary to quote these passages here.
Mr McGrath also argued that the Tribunal made one specific finding of which the Appellants had had no notice. This was the following finding at J87:
Further, the evidence establishes that six other people [in addition to Mr Mancinelli] handled the explosives at the Barracks Road property to the knowledge of Mr Casella and their firearms licences are not in evidence.
As already noted, Mr McGrath made a further claim of procedural unfairness in his oral submissions. This was that the Appellants had had insufficient notice that Ms Rothwell's familiarity with the legislation governing explosives and firearms would be taken into account when considering her fitness and propriety under the Act.
In putting forward these arguments, Mr McGrath relied on the well-known statements of the High Court in Kioa v West [1985] HCA 81; 159 CLR 550, emphasising the importance of procedural fairness in proceedings such as these.
[10]
WorkCover's submissions on procedural unfairness
A major component of Mr El Hage's submissions on these matters was the proposition that Part 2 of the Act and (more significantly) s 6 were in fact identified as important in WorkCover's first submissions. As pointed out above, these submissions were filed and served on 23 October 2014, about three weeks before the commencement of the Tribunal hearing.
These submissions, Mr El Hage observed, also included a claim that Bronze Wing had contravened 'the condition in cl 22(g) of the Explosives Regulation' by storing explosives that it had manufactured at Barrack Road and Wood Road.
In addition, Mr El Hage relied on the following two matters. First, it was put to the Appellants' expert witness, Mr Boné, during cross-examination that 'under the Explosives Act, there's a prohibition on storage of ammunition without a licence or security clearance' (Transcript, 8.12.14, p 246, lines 18-20). Secondly, the Appellants, in their submissions filed after the Tribunal hearing (on 26 February 2015), not only omitted to make any claim that they had received insufficient notice of the claims being made by WorkCover, but set out (at paras 45 and 46) their own responses to some of them, namely, the claims of packaging and storage in breach of the Regulation.
With reference to the claim that the Tribunal denied procedural fairness to Bronze Wing through taking account of Ms Rothwell's degree of familiarity with legislation on explosives and firearms, Mr El Hage submitted as follows: (a) the Tribunal did not in fact address the question whether she herself was 'fit and proper' to hold a licence; and (b) during the Tribunal hearing, Bronze Wing had been made fully aware that because she had become its sole director and shareholder, relevant aspects of her character, reputation and conduct would be taken into account in assessing whether Bronze Wing itself was 'fit and proper'.
While not seeking to deny the importance of maintaining the standards of procedural fairness articulated in Kioa v West, Mr El Hage relied on VEAL v Minister for Immigration and Multicultural and Indigenous Affairs [2005] HCA 72; 225 CLR 88. He placed emphasis on the principle, stated and elaborated at length by Gleeson CJ at [34 - 38], that a decision should not be overturned on the ground of denial of procedural unfairness unless 'practical injustice', such as the loss of an opportunity to make representations or present relevant material, has been suffered by the aggrieved party.
[11]
Our conclusions on procedural unfairness
The foregoing summary of the notifications provided to the Appellants of the grounds on which Bronze Wing's licences were claimed to be liable to cancellation shows that s 6(1) of the Act was given a low profile. Furthermore, there was no express mention of s 3, which contains the important proposition that 'handling' explosives without proper authorisation under an applicable licence or security clearance - this being the activity constituting a criminal offence under s 6(1) - includes 'storing' them.
It is undoubtedly the case, however, that WorkCover's first submissions gave notice to the Appellants (at para 33) of its claim that Bronze Wing had broken the law by authorising Mr Mancinelli and Mr Veit to engage in the 'handling' - specifically, packaging and unloading - of ammunition at Barracks Road. The submissions described Bronze Wing's conduct as a 'failure to abide by' the requirement in cl 20(1) of the Regulation that this should only be done by a person holding a security clearance or under the supervision of such a person. But this same paragraph included a reminder that Part 2 of the Act, which includes s 6(1), 'makes it an offence to handle explosives without a security clearance'.
At the commencement of the paragraph immediately following (para 34), WorkCover's first submissions made it clear also that this aspect of Bronze Wing's conduct was an ingredient of its assertions that Bronze Wing was not a fit and person proper to hold its licences and that these licences should therefore be cancelled under s 21(b) of the Act.
In addition, the passage referring specifically to ss 6 and 6A as 'relevant contextual matters' appeared in paragraph 35.
The same pattern is discernible in the passages in WorkCover's first submissions alleging unauthorised storage of explosives by Bronze Wing. At para 32, it was alleged that Bronze Wing, through depositing ammunition at Barracks Road and Wood Road, had 'stored' explosives at a location not permitted by its licence to manufacture. In advancing this claim, the submissions relied on cl 22(g) of the Regulation. They did not mention Part 2 of the Act or any of the provisions of present relevance within this Part (ss 3 and 6(1)).
In common with the Internal Review decision, these submissions argued that this conduct amounted to a breach of a condition of Bronze Wing's licence to manufacture and accordingly provided grounds for cancellation of the licence under s 21(1)(a)(ii) of the Act. But the claim of unauthorised 'storage' was also an ingredient of WorkCover's assertions that Bronze Wing was not a fit and proper person to hold its licence to manufacture and that this licence should therefore be cancelled under s 21(b) of the Act. Furthermore, the passage in the submissions referring specifically to ss 6 and 6A as 'relevant contextual matters' appeared in the paragraph next following (para 35).
It is clear for these reasons that the Appellants were on notice, at least three weeks before the Tribunal hearing, that the offence created by s 6(1) of the Act was relevant in some way to the case being brought by WorkCover. It is simply not correct to claim, as Mr McGrath did, that the first reference to s 6 within WorkCover's submissions to the Tribunal was in the final submissions filed after the hearing.
Furthermore - and crucially, in our opinion - WorkCover's claims of failures by Bronze Wing to comply with (a) cl 20 of the Regulation (through authorising the 'handling' of ammunition by Mr Mancinelli and Mr Veit) and (b) cl 22(g) (through 'storing' ammunition at locations other than the premises specified in its licence to manufacture) imported in each case a claim of failure to operate within the ambit of one or both of its licences. It was also evident from the formulation of these claims that WorkCover would argue that this 'storing' of explosives by Bronze Wing was a form of 'handling' them. As Mr El Hage pointed out, the Appellants' submissions filed after the Tribunal hearing did not contain any objection, on the ground of procedural fairness, to the making of these claims by WorkCover. Instead, it sought to refute them.
We accordingly find that legal representatives such as Bronze Wing had retained for the Tribunal proceedings can reasonably have been expected to infer from WorkCover's first submissions, filed three weeks before the hearing commenced, that contraventions of s 6(1), committed in circumstances for which Bronze Wing bore responsibility, would form part of the case on fitness and propriety brought against it by WorkCover. It is obvious from even a cursory reading of this provision that it applies to the very situations of 'handling' of explosives or explosive precursors described in WorkCover's first submissions: i.e., 'handling' of them without authorisation from a licence where the regulations require such authorisation.
At no stage, however, did WorkCover allege expressly that Bronze Wing had committed this offence. In the context of the packaging and unloading carried out by Mr Mancinelli and Mr Veit, WorkCover referred instead to a 'failure' by Bronze Wing to 'abide by' the requirements of cl 20(1) of the Regulation. It described the 'storing' of ammunition at Barracks Road as conduct 'in contravention of the condition in cl 22(g)…'
By contrast, the Tribunal, at J95, J98 and J117, recorded a different finding. It held that Bronze Wing 'acted in contravention of s 6(1) of the Explosives Act 2003'.
This discrepancy between WorkCover's allegations and the Tribunal's findings would be a matter of concern if the specific grounds on which the Tribunal affirmed the cancellation of Bronze Wing's licences were that in the three ways delineated at J95, J98 and J117 Bronze Wing had committed the offence created by s 6(1). But the ground of cancellation was materially different. It was that Bronze Wing was not a fit and proper person to hold the licences. The involvement of Bronze Wing in the activities that the Tribunal found to constitute these offences was only one of the factors on which the Tribunal based its finding of lack of fitness. We do not believe that, in the circumstances just outlined, this discrepancy provides grounds for ruling that procedural fairness was denied to the Appellants.
It may well be the case, as Mr McGrath contended, that because s 6(1) created an offence of some seriousness WorkCover was under a heightened obligation to supply full and detailed particulars of every 'charge' against Bronze Wing alleging contravention of this provision. But in the light of our conclusion that the Appellants must be taken to have realised that contraventions of s 6(1) were at least implicitly being alleged by Work Cover, any assertion by them that such particulars were lacking should have been communicated to WorkCover before or during the Tribunal hearing. This was not done.
In two decisions of the Administrative Decisions Tribunal given in the analogous context of disciplinary proceedings against a solicitor, the Tribunal's response to a claim by the respondent that proper particulars had not been furnished by the Law Society was along these same lines: see Law Society of NSW v Orford (No 2) [2008] NSWADT 221 at [136] and Council of the Law Society of New South Wales v Harrison [2010] NSWADT 201 at [65]. These decisions lend support to our view that on this particular issue - whether or not proper particulars have been furnished - it is not appropriate to inject into licensing or disciplinary proceedings the specific rules and requirements that have been developed for the purposes of criminal proceedings.
Our final observation on this matter is that Mr McGrath's argument did not in fact focus on the allegations by WorkCover that constituted the 'charges' against Bronze Wing under s 6(1) of the Act. As indicated above at [73], he referred instead to four paragraphs of the Tribunal's decision. But the extent to which any such charges were particularised by the Tribunal after the matter had been heard is not relevant to any claim of denial of procedural fairness. The fact that these passages contain general propositions is not enough in itself to demonstrate that WorkCover's allegations were also in such general terms that the Appellants could not meet the case being brought against them.
As stated above at [74], Mr McGrath also identified a fifth passage in the Tribunal's decision - paragraph [87] - which in his submission contained a finding of which the Appellants had not had notice. This finding was that to the knowledge of Mr Casella, explosives at the Barracks Road property were handled by 'six other people' (in addition to Mr Mancinelli) and that there was no evidence that any of them held relevant licences. WorkCover did not make any allegation to this effect in its first submissions. But in its final submissions, at paras 42 - 43, it did make such an allegation, and it provided references to passages in the transcript of evidence on which it relied. In their final submissions at para 47, the Appellants contested this allegation. Citing a further passage in the transcript, they asserted that 'all persons handling the ammunition held a firearms licence and [were] therefore licensed to handle the ammunition pursuant to Reg 48 of the Explosives Regulations 2013'.
In view of these matters, Mr McGrath's claim in his oral submissions that the Appellants had had no notice of the Tribunal's finding in J87 is unsustainable.
We turn now to the Appellants' contention that they were not sufficiently notified that Ms Rothwell's familiarity with the legislation governing explosives would be taken into account. This contention also has no substance, in light of the events at the Tribunal hearing that are outlined above at [60 - 61]. The Tribunal itself suggested that Ms Rothwell should testify, because it wished to have 'some information' about her for the purpose of determining Bronze Wing's fitness and propriety. In her affidavit, she claimed to be 'reasonably familiar with the requirements for storage of firearms and ammunition…' Bronze Wing could not maintain that it was taken by surprise by virtue of (a) her being cross-examined on this claim and (b) her answers during cross-examination being taken into account by the Tribunal.
We add that we agree with Mr El Hage's observation that the Tribunal did not at any stage consider whether Ms Rothwell herself was a fit and proper person to hold a licence under the Act. Instead, it gave consideration to her character, reputation and conduct in the course of determining whether Bronze Wing was a fit and proper person.
For the foregoing reasons, we reject the ground of appeal alleging denial of procedural fairness.
[12]
The parties' submissions on standard of proof
This ground of appeal, raised in conjunction with the ground of denial of procedural fairness, was to the effect because the Tribunal in this case was considering possible criminal conduct in the context of licensing proceedings, it was obliged to adopt the Briginshaw test of the standard of proof, but failed to do so.
In his outline of submissions filed before the hearing of the appeal, Mr McGrath quoted a short passage from the judgment of Santow JA in Greyhound Racing Authority (NSW) v Bragg [2003] NSWCA 388 at [35]. In this case, an issue to be determined by the Court of Appeal was whether the Greyhound Racing Appeals Tribunal ('the Tribunal'), in affirming a decision by the Regulatory Committee of The Greyhound Racing Authority ('the Committee'), had applied the appropriate test of standard of proof, namely the Briginshaw test. The Committee had imposed on a greyhound trainer the severe penalty of 10 years disqualification and a fine of ten penalty points.
The passage relied on by Mr McGrath comprised the last two sentences of paragraph [35] of his Honour's judgment. But in order to put it into context, we reproduce here the whole of this paragraph and part of the preceding paragraph:
34… Before the Tribunal the reference was to "an appropriate state of satisfaction" as being the basis on which it was properly pointed out to the Committee that it had to proceed (CB, 88). In submission to the Tribunal it was said that "there is sufficient material there which is logically or rationally probative to the requisite standard" (CB, 85). The appellant seeks to add a gloss never adopted by Committee or Tribunal, for what Dixon J in Briginshaw described as necessary in a court of law:
"in such matters reasonable satisfaction should not be produced by inexact proof, indefinite testimony or indirect references".
35 I am accordingly satisfied that the Tribunal would have recognised that Briginshaw was the standard it would apply. But, as I later elaborate, how that standard was to operate must be understood in the context of an administrative body operating informally and not as a court of law bound by the law of evidence. The notion of "inexact proof, and indefinite testimony or indirect references" needs to be translated to a comfortable level of satisfaction, fairly and properly arrived at, commensurate with the gravity of the charge, achieved in accordance with fair processes appropriate to and adopted by such a body.
In his outline of appeal submissions, Mr McGrath wrote:
The failure to apply or even refer to the Briginshaw standard is a feature of the case. The loose basis on which the Tribunal drew a connection between Bronze Wing and employees of Casella Management offended the prohibition on strained inferences and inexact proofs (to the extent that there was any evidence at all that could have justified the finding).
The response by Mr El Hage, in both his written outline of submissions and his oral submissions, included reliance on the following passage in the Appeal Panel's decision in Nakad v Commissioner of Police NSW Police Force [2014] NSWCATAP 10 at [31 - 34]:
31 We understand the Appellant's point to be that the Tribunal did not have regard to the gravity of the matters alleged when determining whether it was satisfied that the case had been proved. We do not accept that proposition for two reasons.
32 Firstly, to be satisfied that a person is a 'fit and proper' person to engage in certain activities is an 'evaluative conclusion' or opinion based on primary facts: R v Connell; ex parte Hetton Bellbird Collieries Ltd [1944] HCA 42; (1944) 69 CLR 407 at 430 and Calvista Australia Pty Ltd v Administrative Appeals Tribunal [2013] FCA 860. The 'gravity of the matters alleged' applies to the primary factual allegations, not to the evaluative conclusion.
33 One of the primary findings of fact was that the Appellant had "struck or struck at a patron on two separate occasions in circumstances where such action was unnecessary." We do not understand the Appellant to be submitting that the Tribunal did not have regard to the gravity of those matters when making its findings.
34 Secondly, there is no onus of proof, as that term is generally understood, in merits review cases: Bushell v Repatriation Commission [1992] HCA 47; (1992) 175 CLR 408 at 424-425; SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs [2006] HCA 63; (2006) 228 CLR 152 at [40]. The Tribunal must decide what the correct and preferable decision is having regard to any relevant factual material…
Mr El Hage relied in particular on paragraphs [32] and [34] of this decision. His further submissions were as follows: (a) the Tribunal's omission of any reference to Briginshaw in its decision was not in itself an error of law; (b) there was abundant evidence before the Tribunal to support the factual findings on which it based its conclusions; (c) much of this evidence came from the Appellants' own witnesses; and (d) it therefore 'cannot be seriously suggested that the Tribunal did not have regard to the gravity of the matters alleged when making its factual findings (let alone that it erred in making such findings)'.
In his submissions in reply, Mr McGrath argued that these observations of the Appeal Panel in Nakad were inapplicable to the present case because in Nakad the cancellation of the relevant licence was based on a finding by a Magistrates Court that the licence holder had committed a criminal offence. It followed, he said, that there had been no need for the Tribunal in Nakad to apply Briginshaw.
In response to a question from the Bench during his submissions in reply, Mr McGrath indicated that the 'primary finding' by the Tribunal that the Appellants contested in their appeal was its 'conflation' of Bronze Wing and Casella Management. The Tribunal, he maintained, ignored the fact that these companies were separate legal entities.
[13]
Our conclusions on standard of proof
In our judgment, this ground of appeal is not made out. Our starting-point in reaching this conclusion is our endorsement of two propositions put to us by Mr El Hage.
The first of these is that the principle, derived from Briginshaw, that a court or tribunal, when making a finding, must take account of 'the gravity of the matters alleged', applies to the primary factual allegations being considered, not to the evaluative conclusion. The basis on which Mr McGrath sought to distinguish Nakad, where this principle was reiterated in licensing proceedings such as these, is unconvincing.
Secondly, the omission of any reference to Briginshaw in a decision given in such proceedings is not in itself an error of law. The authority on which Mr McGrath chiefly relied in this part of his argument, Greyhound Racing Authority (NSW) v Bragg [2003] NSWCA 388, does not establish that such an omission is erroneous in law. Indeed, the passage from Santow JA's judgment that we have quoted above at [104] (which includes the passage quoted in Mr McGrath's submissions) indicates that in the relatively informal context of tribunal proceedings the approach to fact-finding mandated for courts by the line of authority stemming from Briginshaw need not be strictly applied.
In these circumstances, an error of law by the Tribunal involving failure to apply the correct standard of proof would only be discernible if at some point in its decision it had manifestly based a finding of 'primary fact' on evidence which, on its own showing, did not enable it to reach 'a comfortable level of satisfaction'. Mr McGrath could not identify any passage in the decision which answered this description. When asked to indicate what 'primary finding' by the Tribunal was reached without due regard to the Briginshaw principle, he replied that it erred through 'conflating' Bronze Wing and Casella Management instead of treating them as separate legal entities.
In our opinion, however, the Tribunal's rulings as to the relationship between these two companies did not involve any questions of 'primary fact'. They were 'evaluative conclusions', within the meaning of the Appeal Panel's dicta in Nakad
For the foregoing reasons, the Appellants' claim that the Tribunal erred through failing to apply 'the Briginshaw standard of proof' is not made out.
[14]
Grounds 1 and 2: the finding of illegal 'storing' of ammunition at Barracks Road
These two associated Grounds were formulated as follows:
1. The Tribunal erred in holding Bronze Wing was storing ammunition at the Barracks Rd Premises in contravention of s.6(1) of the Act or regulation 22 (g) of the Regulations.
2. The Tribunal erred a) in law in holding, or b) in finding, that Casella Management was storing ammunition at the Barracks Rd Premises for or on behalf of Bronze Wing or at its direction or authority.
In Grounds 3, 4 and 5, the Appellants again contested the Tribunal's findings on the meaning of 'storing' and on the question whether any 'storing' that occurred was properly to be regarded as storing by Bronze Wing. But since these three Grounds raised other matters as well, they will be dealt with separately.
Because the definition of 'handling' in s 3 of the Act includes 'storing', the question whether Bronze Wing, or Casella Management on its behalf, 'stored' ammunition at Barracks Road is relevant to whether Bronze Wing contravened the prohibition in s 6(1) against 'handling' explosives without proper authority.
The reason why this same question is relevant to WorkCover's claim that Bronze Wing contravened cl 22(g) of the Regulation is that its licence to manufacture 'specified' its Premises at McWilliams Road, with the consequence that under this provision it was not permitted to 'store' explosives at any other premises.
The following passages from the Tribunal's decision provide a sufficient basis for discussion of the matters raised in Grounds 1 and 2 of the appeal:
6 From 19 February 2010 until 28 May 2014, Mr Marcello Casella was both the sole director and the sole shareholder of Bronze Wing.
7 Mr Casella was also involved in the management and ownership of Casella Wines Pty Ltd ("Casella Wines") and Casella Management Pty Ltd ("Casella Management"). Casella Management owns a property at 778 Barracks Road, Yenda ("Barracks Road property"). These premises are warehouse/factory type premises…
66 Mr Boyle gave evidence that, in 2013 and 2014, finished product was regularly despatched from the Doug McWilliams Road property to the Barracks Road property after it had been sold. He said that the process was that Bronze Wing's accountant, Ms Shedrina, contacted an employee of Casella Management once she had received an invoice from a customer. The employee then came to the Doug McWilliams Road property to pick up the finished product and transport it by truck to the Barracks Road property. Mr Boyle acknowledged that he authorised the despatch from the Doug McWilliams Road property.
67 Mr Boyle also gave evidence that pallets of ammunition were sometimes held at the Barracks Road property for a number of days before they were picked up for delivery to the customer…
78 The evidence establishes that, as the respondent submitted, Mr Boyle and Mr Casella were aware of and sanctioned the practice of packaging ammunition at the Barracks Road property and leaving it there until it could be delivered to a customer. This occurred regularly in 2013 as well as in early 2014 and the ammunition was sometimes there for a number of days. I accept the respondent's position that this occurred due to shortage of space at the Doug McWilliams Road property.
79 The applicants' argument that Bronze Wing was not storing the ammunition because it had been sold is not persuasive. If that were so, a licence holder would have no responsibility for the handling of ammunition after an invoice had been received from a customer in relation to it and, possibly, the ammunition had been allocated to the customer. This cannot have been the intention of the legislature. The applicants did not point to any particular provision of the Explosives Act 2003 which they said should be interpreted so as to apply only in respect of ammunition which had not been sold. Whilst the basis for the applicants' submission was not entirely clear, it appeared to be that it was implicit in the legislation as a whole that a licence holder's obligations only extended to explosives or explosive precursors owned by the licence holder. Such an interpretation of the Explosives Act 2003 would not be consistent with the clear purpose of the legislation to ensure the safe handling of explosives.
80 Nor am I persuaded that Bronze Wing had no responsibility for the ammunition because it was "in transit." The ammunition had not been packaged and was not ready for shipping to the customer. It is arguable that once the ammunition was collected by a Casella Management employee from the Doug McWilliams Road property, it was being handled and stored by Casella Management. However, Bronze Wing may only act through employees and contractors or agents. It therefore needs to be considered whether Casella Management was storing the ammunition on behalf of Bronze Wing and/or at its direction.
81 The evidence indicates that there was a high degree of cooperation between the companies in which Mr Casella had an interest, and that Casella Management and Casella Wines often acted, at Mr Casella's direction, in Bronze Wing's interests.
82 Mr Casella gave evidence that he arranged for Casella Management to provide Bronze Wing with the initial capital to obtain its licence to manufacture. It also appears from Mr Casella's evidence that Bronze Wing used the Barracks Road property (which belonged to Casella Management) for its own purposes. He refers, in his affidavit, to "the expansion of BW's sales and the use of Barracks Road as the packaging and transportation warehouse centre for BW's product". Mr Casella also referred to preparing the Barracks Road property to take over from Doug McWilliams Road as the new manufacturing plant. This again suggests that Bronze Wing could use the Barracks Road property as it wished.
83 Mr Boyle gave evidence that the Barracks Road property was used by Bronze Wing for the storage of components, merchandise and packaging, although he denied that it was used for the storage of Bronze Wing's ammunition. This indicates that, at least in Mr Boyle's view, it was Bronze Wing which was storing those goods at the Barracks Road property and not Casella Management. It is difficult to see the basis for a distinction in relation to the explosives which were present at the Barracks Road property.
84 Mr Boyle and Mr Casella both knew that ammunition, which had been sold by Bronze Wing, was kept at the Barracks Road property, sometimes for a day or more. They both authorised this arrangement. In these circumstances, I am satisfied that Bronze Wing stored the ammunition at the Barracks Road property, notwithstanding that Casella Management owned that property and that employees of Casella Management handled the explosives at that property.
95 For the above reasons, I find that Bronze Wing stored ammunition at the Barracks Road property after it had been sold, and that this was not authorised by its licences. Bronze Wing was thereby handling the ammunition in contravention of s 6(1) of the Explosives Act 2003.
[15]
The Appellants' submissions on 'storing' at Barracks Road
In his written and oral submissions, Mr McGrath argued that the 'keeping' at Barracks Road of ammunition that Bronze Wing had manufactured did not involve 'storing' of it by or on behalf of Bronze Wing, by virtue of the following aspects of the evidence and the Tribunal's factual findings.
1. The ammunition in question had been sold to customers. It was therefore no longer in the ownership of Bronze Wing.
2. The 'keeping' of the ammunition was 'transient', representing 'part of the packaging or transportation' that was required for the purpose of delivery to customers. There was no evidence to suggest that any of the ammunition was delivered back to Bronze Wing's premises.
3. If any 'storing' was involved, this was 'storing' by Casella Management, not by Bronze Wing. Bronze Wing had parted with possession of the ammunition. The Tribunal's findings that Bronze Wing knew of and authorised the relevant conduct by employees of Casella Management did not justify its inference that the entity engaging in any 'storing' was Bronze Wing, not Casella Management.
4. The conduct to which s 6(1) of the Act applies does not include authorising or directing a person to 'store' explosives without a licence. It follows that Bronze Wing could not be held criminally liable under s 6(1) solely because it was found to have authorised or directed Casella Management (which did not hold a licence) to 'store' ammunition.
In para 18 of his written submissions, Mr McGrath set out the following argument regarding the meaning of 'storing' in the Act:
"Storing" is not defined in the Act, but is to be construed in the context of the Act. It, generally speaking, means the keeping or laying aside of goods or materials for future use. It comprehends a non-transitory, semi-permanent or long term, holding or keeping of the goods or materials, usually with the intention of the storer retrieving or using them at a later time. It involves the stockpiling or accumulation of a reserve supply for future sale or use. In the context of the Act, the word "storing" does not include the interim accumulation or keeping of a limited amount during manufacturing, processing, packing or transport of goods or materials. Rather, it describes conduct associated with a task or function which has as its purpose the storage of explosive or explosive precursors for future use or sale by the licence holder. To the extent that there is a purposive element in the definition of 'storing' it requires an intention of the person who stores the goods or materials to later use them for his or her or its own purposes.
A footnote to this passage contained the following extracts from dictionary definitions of the verb 'store':
Oxford English Dictionary:… 4.a. To keep in store for future use; to collect and keep in reserve; to form a store, stock or supply of; to accumulate, hoard…
Macquarie Dictionary:… 11. To supply or stock with something, as for future use. 12. Also, store up, to lay up or put away, as a supply for future use. 13. To deposit in a storehouse, warehouse, or other place, for keeping.
In other footnotes to para 43, three cases were cited. We shall discuss two of them. The third, Amalgamated Footwear & Textile Workers Union of Australia v Federated Ironworkers Association of Australia (1990) 42 IR 278, does not appear to us to provide material assistance.
The first of these cases, McGee v Chitty [2011] WASCA 125, involved an appeal against the acquittal by a magistrate of a person charged with offences under firearms legislation. In the passage on which Mr McGrath relied (at [43 - 44]), the Court of Appeal of Western Australia made the following observations on the meaning of the phrase 'otherwise than by way of storage' in this legislation:
43 The word 'storage' means 'the state or fact of being stored'. The word 'store' means 'to deposit in a storehouse, warehouse or other place for keeping'... The phrase 'otherwise than by way of storage' means 'otherwise than as a method or means of storage'…
44 The phrase 'otherwise than by way of storage' is plainly wide in its ambit. It captures all of the many states that a firearm can lawfully be in, other than when it is stored. Some of those states include when the firearm is in use or is in transit between places.
The second case is Botany Bay City Council v BIG Transport Pty Ltd [2006] NSWCA 57. Here the Court of Appeal construed the term 'storage' in the context of a development consent relating to the use of prime movers and trailers by a transport company. In the passage on which Mr McGrath relied, Tobias JA, after referring to dictionary definitions of 'storage' and 'store', held as follows at [35 - 40]:
35 The foregoing definitions, if applied to Condition 22, would indicate that trailers were stored upon the premises where, being separated from a prime mover, they were being kept in reserve in the sense that they were not required for immediate use in the respondent's day to day operations. In other words, the consent was concerned to limit both the number of prime movers and trailers which were to be left or parked within the open areas of the premises in circumstances where they were not currently required for the purpose of collecting, transporting and delivering containers on behalf of the respondent's customers.
36 Accordingly, a trailer with a container which is returned from the container depot at Port Botany to the premises to be parked there temporarily until it can be delivered to the customer to whom it was destined because of the inability to deliver it directly from the depot to the customer's premises, is to be considered, as it were, as still in transit between the container depot and the customer's premises and thus in use for the immediate purpose of the respondent's business in collecting and delivering containers on behalf of its customers.
37 In my opinion, any other construction would frustrate the clear purpose of the consent which was to permit three prime movers together with trailers to be operated from the premises for the purpose of the respondent's carrying on transport business. In this context, it is well to remember, as Mason P, with whom Stein and Giles JJA agreed, observed in House of Peace Pty Ltd v Bankstown City Council [2000] NSWCA 44; (2000) 48 NSWLR 498 at 507 [37]), that a development consent
"must speak according to its written terms, construed in context but having regard to its enduring function."
38 To the same effect, the President further observed (at 508 [41]):
"The enduring nature of a development consent encourages a fair but liberal reading of the rights it confers upon a landowner who may spend considerable money in acting upon it ..."
39 Given the nature of the respondent's business, I see no basis for construing the consent to limit the number of trailers able to be utilised in its operation to three although, as her Honour found, only three could be stored upon the premises at any one time.
40 I would therefore agree with her Honour's observations in [27] of her judgment that the consent differentiates between on the one hand the temporary parking of trailers, with or without containers on them, while waiting to further use them for collection or delivery in the course of the day, overnight or over a weekend and, on the other, their storage when not required in the daily operations of the respondent's business. Such a construction is supported by Conditions 4, 7, 8, 14 and 20 which draw a clear distinction between vehicles being parked upon or standing within the premises and vehicles being stored thereon.
In his oral submissions, Mr McGrath did not make any material addition to these arguments about the meaning of 'storing' in the Act, other than (a) to point out that since s 6(1) creates a serious criminal offence, both its terms and the definition of 'handling' in s 3 should be construed strictly, and (b) to seek to refute a submission by Mr El Hage (see below) as to the 'logical consequence' of the Appellants' arguments on this question.
Mr McGrath advanced the following arguments with regard to the Tribunal's conclusion at J84, that 'Bronze Wing stored the ammunition at the Barracks Road property, notwithstanding that Casella Management owned that property and that employees of Casella Management handled the explosives at that property'.
First, the Tribunal's basing of this conclusion on 'strained inferences' and 'inexact reasoning' was erroneous in law. As was made clear in the judgment of Mason CJ in Australian Broadcasting Tribunal v Bond [1990] HCA 33; 170 CLR 321 at [87], it is an error of law for a court or tribunal to draw inferences that are not reasonably open to it from the facts as found.
Secondly, a number of the Tribunal's findings - for example, the finding of 'authorisation' in the second sentence of J84 - were 'vague'. This was impermissible for reasons outlined in the Appellants' submissions based on Briginshaw v Briginshaw.
Thirdly, the Tribunal ignored the separate corporate entities of Bronze Wing and Casella Management. In his written submissions, Mr McGrath argued that the evidence relied on 'did not establish the level of detailed control necessary so as to prove that the relevant acts or omissions of Casella Management were the acts of Bronze Wing'. It was insufficient for the Tribunal to rely, as it appeared to do at J81, on its finding of a 'high degree of cooperation between the companies in which Mr Casella had an interest'. In fact, the 'authorisation' given by Bronze Wing to Casella Management went no further than the instructions described at J66.
Fourthly, the Tribunal appeared to accept the proposition that 'being aware of, permitting or authorising conduct' amounts to carrying out the conduct.
Fifthly, to the extent, if any, that Casella Management was storing ammunition at Barracks Road as a subcontractor engaged by Bronze Wing, it required a licence of its own in order to comply with s 6(1) of the Act. Since this provision did not create an offence of authorising or directing a person to store explosives, Bronze Wing could not be held criminally liable on account of the failure by Casella Management to obtain a licence. It was relevant also that Mr Mancinelli, an employee of this company who was involved in the transporting of the ammunition to Barracks Road, held a licence under the Firearms Act that entitled him to store ammunition.
[16]
WorkCover's submissions on 'storing' at Barracks Road
Mr El Hage's written and oral submissions included the following propositions regarding the meaning of 'storing' in the Act:
1. Because this term was not defined in the Act, it should be given its normal and natural meaning.
2. Any 'purposive' element in the dictionary definitions of 'storing' should not be taken to limit this term to situations where goods are stored for a person's own purposes. An individual may, for example, 'store' goods for the benefit of a friend, colleague or family member. Equally, a retail enterprise may 'store' bulky goods that it has sold pending their collection by the buyer. This form of 'storage' may last for one or two days only, or for longer periods such as two weeks.
3. It was important also to take account of the context in which the term 'storing' is used in the Act. The most significant feature of that context is that it forms part of the broad and comprehensive definition of 'handling' contained in s 3. That definition includes the activity of 'conveying' as well as 'storing'. Both of these activities are subject to control through licensing: see cll 21(d), (e) and (f) and 22(g) of the Regulation. Furthermore, under cll 35 and 36 of the Regulation, WorkCover may require a licence holder to submit a security plan which includes details of its 'facilities, systems and procedures… for the safe handling' of explosives, and/or a safety management plan. Clauses 84 and 85 specify in considerable detail how the storage of explosives must be carried out.
4. The three authorities on which Mr McGrath relied were not in point, for the following reasons. Both McGee v Chitty [2011] WASCA 125 and Amalgamated Footwear & Textile Workers Union of Australia v Federated Ironworkers Association of Australia (1990) 42 IR 278 were concerned with the meaning of 'storage', not 'storing'. The case of Botany Bay City Council v BIG Transport Pty Ltd [2006] NSWCA 57 dealt also with 'storage'; in addition, the development consent with which it was concerned expressly differentiated between the 'temporary parking' of trailers when their further use on the same day was contemplated, and the 'storage' of them when they were 'not required in the daily operations of the respondent's business (see Tobias JA's judgment at [40]).
5. The 'logical consequence' of the definition of 'storing' propounded by the Appellants was that it would be permissible for them to leave ammunition that a customer had purchased from them on a football field, in a pub or in someone's backyard. This would be completely contrary to the objectives of the Act and the Regulation, and 'would lead to a capricious result'.
In asserting that the Tribunal did not err in finding that the storing of ammunition at Barracks Road was 'storing' conducted by Bronze Wing, not Casella Management, Mr El Hage emphasised that both Mr Boyle, in his capacity as Bronze Wing's manager and 'responsible person', and Mr Casella, in his capacity as sole director and shareholder of Bronze Wing during the relevant period, gave instructions for ammunition to be taken to Barracks Road pending collection by a customer. Bronze Wing accordingly retained control of, and responsibility for, the ammunition until it was collected.
According to Mr El Hage, the Tribunal's rulings to this effect were based on a correct understanding of the law and open to it on the facts. There was nothing in its decision to suggest that it failed to take account of the existence of Bronze Wing and Casella Management as legal separate entities. Finally, the Appellants did not identify in their submissions any legal error in the Tribunal's rejection of their claim that Mr Mancinelli's licence under the Firearms Act entitled him to store ammunition in the circumstances spelt out in J87 - i.e., those of 'storage offsite', on the instructions of Bronze Wing, 'for the purposes of its manufacturing or import/export activities'.
[17]
Our conclusions on 'storing' at Barracks Road
In our opinion, Grounds 1 and 2 of the Appeal must be rejected, broadly for the reasons advanced by Mr El Hage.
We agree with him that the broad and comprehensive nature of the definition of 'handling' in s 3 of the Act suggests that each of the terms in it - such as the term 'storing' - should be construed in a manner that promotes its evident intent to cover all forms of 'handling'. It is significant that the definition is not exhaustive, but commences with the words 'handling includes…' To embrace within this definition the circumstances of 'keeping' of ammunition that occurred at Barracks Road - namely, its retention for a short period at a site other than that of its manufacture, pending collection by a customer to whom it had been sold - does not extend artificially the normal and natural meaning of the term 'storing'. Furthermore, to do this accords entirely with the detailed provisions of the Regulation relating to storage. The authorities cited by Mr McGrath do not call for a different determination of this question because, for the reasons given by Mr El Hage, they are concerned with the term 'storage', used in materially different contexts.
The limitations that the Appellants' argument would place on the term 'storing' would indeed, as Mr El Hage contended, create a significant gap in the regulatory regime created by the legislation and would be clearly contrary to the policy underlying this legislation.
We also endorse Mr El Hage's submission that there was no error by the Tribunal, either in law or in fact, in concluding that Bronze Wing, not Casella Management, 'stored' the ammunition at Barracks Road. The key factors, as he said, were that Bronze Wing, through Mr Boyle and/or Mr Casella, both gave instructions that this should occur, thereby initiating the activities leading to the placing of the packages of ammunition in the premises at Barracks Road, and retained control over them. If Bronze Wing had wished that any of the ammunition should be conveyed back to the Premises - this could, for instance, be due to rescission of the relevant sale or a concern that the ammunition might be defective - nothing in the evidence about its dealings with Casella Management suggests that its instructions to this effect would be ignored. There was ample evidence on which the Tribunal could draw the inference that even though the two companies were separate legal entities, the act of storing the ammunition at Casella Management's premises at Barracks Road was an act of Bronze Wing, not of Casella Management.
We agree with Mr El Hage's submission that the Appellants did not identify any legal error in the Tribunal's ruling on Mr Mancinelli's status as a licence holder under the Firearms Act.
On account of these conclusions, we do not need to address Mr McGrath's submission (see subparagraph (4) of paragraph [121] above) that the conduct to which s 6(1) of the Act applies does not include authorising or directing a person to 'store' explosives without a licence.
[18]
Ground 3: the finding of illegal 'storing' of ammunition at Wood Road
The claims made in this Ground were as follows: (a) the Tribunal erred in law through holding that as at 12 February 2014 Bronze Wing had stored five pallet of ammunition at Wood Road in contravention of s 6(1) of the Act; and (b) there having been no agreement or admission that ammunition found there belonged to Bronze Wing, it was against the weight of the evidence to so find.
At J104 to J108, the Tribunal dealt with allegations by WorkCover that both ammunition and propellant belonging to Bronze Wing had been found by the police at the premises of Casella Management at Wood Road. It found this allegation proven as regards the ammunition, but not the propellant. The passages in its decision dealing with the ammunition were as follows:
104 The respondent said that Bronze Wing has, on at least one occasion, used the Wood Road property to store large quantities of ammunition. Mr Casella gave evidence that he moved five pallets of ammunition from the Barracks Road property to the Wood Road property prior to 12 February 2014, when they were found there by police…
108 The parties agreed that the ammunition found by police at the Wood Road property belonged to Bronze Wing. Mr Casella's evidence was that the ammunition remained there for several days. Bronze Wing was therefore storing ammunition at a place other than that authorised by its licences, and was handling the ammunition in contravention of s 6(1) of the Explosives Act 2003.
Referring to relevant parts of the evidence, Mr McGrath submitted that there was no agreement by the parties that 'the ammunition found by police at the Wood Road property belonged to Bronze Wing'. His further submissions were as follows: (a) 'storing' of it at this property was not established merely by findings that it belonged to Bronze Wing and that Mr Casella moved it there 'for a couple of days'; and (b) the decision to move it there was not made by Mr Boyle, who was Bronze Wing's 'Security Holder'.
Mr El Hage agreed that there was no agreement by the parties as to the ownership of the ammunition found at Wood Road. But he argued that there was evidence, chiefly constituted by testimony from Mr Casella, on which the Tribunal's finding of ownership by Bronze Wing was clearly available, and that Mr Casella's conduct in arranging for it to be transferred to Woods Road 'on safety grounds' and retained there for a few days clearly constituted 'storing' by Bronze Wing. This was the case, he said, because at that time Mr Casella was the sole director and shareholder, and therefore the 'controlling mind', of Bronze Wing. It made no difference that Mr Boyle was not aware of these events.
For the reasons outlined earlier, we agree with the Tribunal's conclusion that the activities of moving this ammunition to Woods Road and retaining it there for a few days amounted to 'storing' it within the meaning of the Act. We also conclude that there was evidence to support the Tribunal's findings that (a) Bronze Wing was the owner of the ammunition and (b) Mr Casella's instructions for these steps to be taken were instructions given on behalf of Bronze Wing. His status in Bronze Wing was sufficient to permit the latter finding to be made and it was irrelevant that Mr Boyle was not involved.
For these reasons, Ground 3 of the appeal must be rejected.
[19]
Grounds 4 and 5: illegal packaging, transporting and 'storing' of ammunition
We are dealing with these two Grounds of the appeal in conjunction with each other because there is a significant degree of overlap between them.
The terms of the two Grounds are as follows:
Ground 4: The Tribunal erred in law in holding that Bronze Wing authorised Casella Management and others to package ammunition for the purposes of Bronze Wing's operations and thereby contravened s. 6(1) of the Act. It should have found there was no such authorisation.
Ground 5: The Tribunal erred a) in law in holding or b) in finding that Bronze Wing had loaded ammunition, conveyed it to the Barracks Rd Property and stored it there in contravention of s. 6(1) of the Act.
In so far as Ground 5 challenged the Tribunal's ruling on the meaning of 'storing', it is not necessary to revisit this issue. The same applies to a claim by the Appellants that Mr Mancinelli held a licence under the Firearms Act that entitled him to transport and package ammunition. As with their corresponding claim that he was authorised by this licence to store ammunition, the Appellants did not identify, in their appeal submissions, any legal error attending the Tribunal's rejection of this claim.
For present purposes, the relevant passages in the Tribunal's decision are as follows:
109 Another matter on which the respondent relied for its submission that Bronze Wing is not a fit and proper person to hold a licence was its allegation that Bronze Wing authorised individuals without a security clearance, who were not supervised by a person with a security clearance, to transport and package explosives… Bronze Wing "breached" cl 20(1), in the respondent's submission, by authorising Casella Management's employee, Mr Manchinelli, to pack ammunition belonging to Bronze Wing at the Barracks Road property, and to transport it there, without a security clearance and without being supervised by someone with a security clearance. It also breached cl 20(1), according to the respondent, when on numerous occasions in 2013 and 2014 Mr Casella and at least five other men also packed and transported ammunition without a security clearance or the required supervision.
110 There was no dispute that the ammunition was handled and transported by Mr Manchinelli, Mr John Veit and other employees of Casella Management on a regular basis in 2013 and 2014 and that, at the time, those persons did not hold a security clearance and were not supervised by a person holding a security clearance. Mr Casella and Mr Boyle were aware of this practice and authorised or sanctioned it.
111 The applicants submitted that, in the circumstances, there was no requirement for the workers at the Barracks Road property to be supervised or to have a security clearance when handling ammunition which had been sold by Bronze Wing. They said that Bronze Wing was not responsible for the ammunition because it had been sold and was in transit. The ammunition at Barracks Road property was, in their submission, under the control of Casella Management. Mr Manchinelli and Mr Veit were employees of Casella Management and not under Bronze Wing's control or supervision.
114 As already noted, it was an offence for Bronze Wing to handle explosives unless authorised to do so by its licence in circumstances where the regulations required the handling to be authorised by a licence (Explosives Act 2003, s 6(1); Explosives Regulation 2013, cl 17). The circumstance that the ammunition was sold did not affect Bronze Wing's obligation to comply with the explosives legislation in relation to that ammunition.
115 The evidence establishes that, when employees of Casella Management handled ammunition sold by Bronze Wing, they were doing so on behalf of Bronze Wing. Mr Manchinelli, an employee of Casella Management, gave evidence that he was requested to attend the Barracks Road property in 2014 to package ammunition in accordance with orders placed by Bronze Wing customers. Mr Boyle was aware of this. It can be inferred that the completion of this task assisted Bronze Wing to fulfil its contractual obligations to customers.
116 The applicants' argument that both Casella Management and Mr Manchinelli were authorised to handle the ammunition under the firearms legislation, even if accepted, does not affect the question of whether Bronze Wing acted in contravention of s 6(1) of the Explosives Act 2003 when authorising them to handle ammunition on its behalf. Clause 48(2) of the Explosives Regulation 2013 does not provide Bronze Wing with an exception from the requirement to be authorised by a licence in order to possess, use, store or transport ammunition, for reasons given above.
117 It follows that, when Bronze Wing authorised Casella Management employees and others to package ammunition for the purposes of its manufacturing operations, it acted in contravention of s 6(1) of the Explosives Act 2003.
118 … Bronze Wing commits an offence if it handles an explosive other than in accordance with its licence, in circumstances where the regulations require the handling to be authorised by a licence (Explosives Act 2003, s 6(1); Explosives Regulation 2013, cl 17). "Handling" includes "conveying" which in turn includes carrying, loading, unloading and transferring (Explosives Act 2003, s 3(1))… When, with the authorisation of Bronze Wing, Casella Management employees loaded ammunition on to a truck at the Doug McWilliams Road property, conveyed the explosives to the Barracks Road property, and unloaded the ammunition at that property, Bronze Wing acted in contravention of s 6(1) of the Explosives Act 2003…
We have omitted from these paragraphs certain passages in which the Tribunal rejected, with reasons, an argument by the Appellants that certain provisions of the Australian Code for Transport of Explosives by Road and Rail ('the Explosives Code') provided authorisation for Casella Management's employees to engage in the transportation of ammunition. In the appeal, the Appellants did not challenge this ruling, though as outlined below they invoked this Code as support for other arguments.
As he had done in his submissions in support of Grounds 1 and 2, Mr McGrath argued that instructions or authorisations given by Mr Boyle and/or Mr Casella to employees of Casella Management to load, transport, unload and/or package ammunition that belonged or had belonged to Bronze Wing provided an insufficient foundation for the Tribunal's rulings that these activities were carried out by Bronze Wing.
Mr McGrath also argued that the 'packaging' carried out by Casella Management's employees was not 'packing' within the meaning of s 3 of the Act because (to put it broadly) it was simply the further packaging of packages of ammunition that had been put together by employees of Bronze Wing at the Premises. He referred us to testimony on this matter given by Mr Mancinelli and Mr Boyle.
A further submission made by Mr McGrath was that the requirement of supervision of the packing of ammunition by a person holding a security clearance was imposed as late as 29 October 2013, under the Explosives Amendment Act 2013. Any ruling by the Tribunal that Mr Boyle, as the 'responsible person', was in breach of any such requirement before that date was accordingly erroneous.
Relying on extracts from the transcript of his cross-examination of Mr Boyle and Mr Casella, Mr El Hage argued that the transporting and packaging of ammunition by employees of Casella Management was clearly carried out under the authorisation of one or other of these individuals and that there accordingly was ample evidence on which the Tribunal could base its ruling that these activities were conducted by Bronze Wing.
Mr El Hage referred us to passages in the transcript of Mr Boyle's cross-examination from which it was clear, he said, that the packaging operations carried out at Barracks Road were not confined to the 'repackaging' of already packaged ammunition and that they amounted to 'handling' within the meaning of the definition of this term in s 3.
In response to Mr McGrath's submission based on the legal situation preceding the commencement of the Explosives Amendment Act 2013, Mr El Hage argued that nothing in the Tribunal's decision suggested that it took account of events occurring before 29 October 2013.
In our opinion, there is nothing in Mr McGrath's submissions to persuade us that the Tribunal erred in its rulings on the transporting and packaging activities carried out by Casella Management's employees.
For the same reasons as we gave in determining Grounds 1 and 2, there was ample evidence on which the Tribunal could draw the inference that even though Bronze Wing and Casella Management were separate legal entities, these activities constituted conduct by Bronze Wing.
We regard the evidence about the 'packaging' activities as not at all clear. But it suggests that on at least one occasion it went beyond mere 'repackaging'. Photographs taken by police at Barracks Road included one of an open box of ammunition, bearing the label Bronze Wing, with loose ammunition nearby. In addition, Mr Mancinelli testified that at these premises boxes of ammunition were sorted out in order that each customer would receive the particular ammunition that he or she had purchased. For reasons such as these, we are satisfied that there was evidence on which the Tribunal could properly find that some of the packing operations carried out at Barracks Road fell within the definition of 'handling' in s 3 of the Act.
We agree with Mr El Hage that a high proportion, if not all, of the events on which the Tribunal based its decision occurred after 29 October 2013.
For these reasons, we reject Grounds 4 and 5 of the appeal.
[20]
The question of 'fitness and propriety'
In Ground 7, the Appellants challenged in general terms the Tribunal's conclusions that Bronze Wing and Mr Boyle were not 'fit and proper' to hold, respectively, a licence or a security clearance under the Act. In the remaining Grounds (8 to 10), they claimed that the Tribunal erred in law or in fact in ways that had direct relevance to this conclusion.
In the Appellants' written submissions, much of the argument offered in support of Ground 7 was repeated in the context of Grounds 8 to 10. For these reasons, we will not treat each of these Grounds separately, but will organise our discussion by reference primarily to specific issues that the Tribunal took into account in affirming WorkCover's decisions on fitness and propriety.
In its decision at J48 to J62, the Tribunal provided an outline of the general principles governing the criterion of 'fitness and propriety' under licensing regimes and recorded some observations about the particular significance of Mr Boyle's being the 'responsible person' under the licences granted under the Act to Bronze Wing. This part of the decision was not questioned in the appeal proceedings.
It is useful at this stage to reproduce the passage at the end of the Tribunal's decision (J160 to J165) in which it summed up its reasons for concluding that Bronze Wing was not fit and proper to hold its licences under the Act and Mr Boyle was not fit and proper to hold a security clearance:
160 Bronze Wing breached requirements of the explosives legislation relating to storage of ammunition, and the requirement that ammunition is handled only by someone with a security clearance or someone supervised by such a person, over a significant period of time. Mr Boyle knew about and authorised these breaches. Both Mr Boyle and Ms Rothwell, Bronze Wing's director, defended such conduct in these proceedings, maintaining the position that Bronze Wing had not contravened the explosives legislation. They submitted that Bronze Wing's conduct was "safe" in circumstances where I have found that it was not. Neither acknowledged the company's past mistakes. For these reasons, I find that Bronze Wing is no longer a fit and proper person to hold a licence under the Explosives Act 2003.
161 The correct and preferable decision is therefore to affirm the respondent's decision to cancel those licences pursuant to s 21(b) of the Explosives Act 2003.
162 The respondent contends that the correct and preferable decision is to affirm its decision to cancel Mr Boyle's security clearance under s 21(b) of the Explosives Act 2003, on the basis that the Tribunal is of the opinion that Mr Boyle is no longer a fit and proper person to hold, or to continue to hold, the security clearance.
163 The respondent said that Mr Boyle was not a fit and proper person given the events which occurred in February 2014, the conduct of Bronze Wing for which he is the responsible person, Bronze Wing's disregard for the law whilst he was the responsible person, his knowledge and sanctioning of the unauthorised storage of explosives and the unauthorised handling of Bronze Wing's ammunition, his failure to take steps to alert WorkCover to this and his lack of proper familiarity with the explosives legislation.
164 For the reasons given by the respondent, and based upon the evidence discussed in relation to Bronze Wing, I am satisfied that Mr Boyle is no longer a fit and proper person to hold a security clearance under the Explosives Act 2003.
165 The correct and preferable decision is therefore to affirm the respondent's decision to cancel Mr Boyle's security clearance pursuant to s 21(b) of the Explosives Act 2003.
[21]
Specific issues raised in Grounds 7 to 10 of the appeal.
The relevance of the previous Grounds. The Appellants claimed that if they succeeded on any of Grounds 1 to 6 of the appeal, the Tribunal's findings that Bronze Wing and Mr Boyle were not fit and proper would have to be set aside on the ground of error of law.
WorkCover did not dispute this proposition (albeit that it might be perceived as unduly broad), but relied instead on its arguments opposing these six grounds of appeal.
The relevance of Mr Casella's conduct. The Appellants submitted that since Mr Casella was no longer a director or a shareholder of Bronze Wing at the time when the Tribunal reached its decision, it erred in holding or finding that on account of his past conduct Bronze Wing was not fit and proper to hold a licence. In this specific context, they described as 'wrong' a finding made by the Tribunal at [115].
As WorkCover argued, however, neither in the above summary (J160) of the Tribunal's reasons for finding Bronze Wing to be not fit and proper, nor elsewhere in its decision, was it said that Mr Casella's past conduct was enough of itself to justify this finding. On the other hand, the past conduct of Bronze Wing for which Mr Casella was partly or wholly responsible was a matter that it was entitled, and indeed obliged, to take into consideration. We add that the paragraph (J115) cited by the Appellants does not in fact refer to Mr Casella or his conduct.
The 'risk to the community' generated by Bronze Wing's conduct. At J119 to J135, the Tribunal discussed a claim by the Appellants that the alleged breaches of the Act or the Regulation by Bronze Wing did not give rise to any risk to the community because the type of ammunition involved (category 1.4S) did not present a significant hazard.
An important component of this discussion by the Tribunal was its finding that the conduct of Mr Casella and, to a lesser extent, of Mr Boyle with regard to the storage of Bronze Wing's ammunition was governed (to quote from J125) by 'perceptions of what was safe, rather than a concern to comply with legislative requirements'.
The evidence furnished by Mr Boné, the Appellants' expert witness, included an opinion supporting the Appellants' claim regarding 1.4S ammunition. On the other hand, Inspector Brooks, a witness called by WorkCover, testified that '1.4S shot shells are an explosive and are dangerous goods for transportation, regardless of their classification' (see J130). At J132-J133, the Tribunal stated, giving reasons, that it gave Mr Boné's evidence 'very little weight' and that it accepted Inspector Brooks's evidence 'concerning the danger of lead shot and of 1.4S shot shells'.
At J134-J135, the Tribunal summed up its conclusions on this topic as follows:
134 The perception that there is no or little "risk to the community" in Bronze Wing's past conduct, which was conveyed by the applicants' witnesses and put to the Tribunal in the applicants' submissions, is problematic, even if there is a lower risk to the community in the handling of ammunition than that posed by the handling of some other explosives. This is because the perception can be used to justify the applicants acting other than in accordance with the explosives legislation, and failing to take steps to ensure that WorkCover is aware of matters which may pose a risk to safety, such as storing explosives in shipping containers or packaging explosives off-site.
135 For reasons given above, I am not satisfied that there was, as the applicants submit, very little risk to the community or to employees and contractors of Bronze Wing and Casella Management in the applicants' handling of ammunition contrary to legislative requirements. The fact that the Barracks Road property was the subject of a planning permit and a licence application to manufacture ammunition, on which the applicants relied, is not determinative.
Mr McGrath argued that while 'the risk to the community' was not of itself a factor to be taken into account in determining Bronze Wing's fitness and propriety, the 'extent of the risk' might be of relevance to 'the degree of good character, honesty, knowledge or ability required of a licensee'. He claimed that the Tribunal, at J135, erred in law by 'effectively' reversing the onus of proof. It should not have made the finding recorded in the first sentence of this paragraph, because the onus had lain on WorkCover to demonstrate, in accordance with the Briginshaw test, that a 'relevant' risk to the community had arisen and WorkCover had not discharged this onus. In addition, it had erred through failing to make a finding as to the extent to which the risk to the community of category 1.4S ammunition was lower than the risk of ammunition generally.
In his submissions in reply, Mr McGrath drew our attention to extracts from the Explosives Code that were annexed to Inspector Woods' affidavit. On 11 August 2015, pursuant to directions that we gave at the end of the appeal hearing, the Appellants filed a bundle incorporating these and other portions of the material annexed to this affidavit. The extracts from this Code included provisions (for example, Table 2.1, which is headed Risk Categories for Explosives) indicating that category 1.4S explosives are classified as Low Risk.
In response, Mr El Hage argued that the Tribunal did not 'reverse' the onus of proof because its finding at J135 arose from a submission by the Appellants that Bronze Wing's conduct did not create any risk to the community. Its rejection of that submission was, he said, amply supported by the evidence.
In our judgment, the Appellants' argument on this matter is misconceived, but not entirely for the reasons advanced by Mr El Hage. The phraseology of the opening sentence of J135 does imply that the Tribunal treated some sort of onus of proof on this question of risk as lying on the Appellants.
The Tribunal was however dealing with a claim by the Appellants that because category 1.4S ammunition posed little or no risk to the community, breaches of the legislation governing its packaging, transport and storage were excusable. In the course of rejecting this claim, it held that ammunition in this category was dangerous, albeit less dangerous than a number of other types of explosive. Contrary to Mr McGrath's submission, it did not have to determine the extent to which the risk to the community of category 1.4S ammunition was lower than the risk of ammunition generally. Its ruling on this question had an adequate foundation in the evidence of Inspector Brooks, while also being compatible with the provisions of the Explosive Code classifying 1.4S explosives as Low Risk. In the appeal, it should be noted, the Appellants did not challenge the Tribunal's grounds for preferring the evidence of Inspector Brooks to that of Mr Boné.
Mr Boyle's views on the Act's regulation of the handling of explosives. At J136 to J142, the Tribunal considered the question whether Mr Boyle (and also Mr Casella) held an honest and reasonable belief that the conduct of Bronze Wing which it had held to be in breach of the Act or the Regulation was in fact in conformity with this legislation.
Most of this section of the Tribunal's reasons should be quoted:
136 The applicants' submission that they acted in accordance with the rules and regulations cannot be accepted in light of my findings above. They also said that, if there has been a breach, it was inadvertent. They said that the evidence was that Mr Boyle and Bronze Wing acted on the honest belief that the ammunition was in transit and once it left the licensed premises was adequately covered by s 65 of the Firearms Act 1996.
137 The respondent submitted that the breaches could not have been inadvertent given their nature, the repetition of the contravening conduct and the length of time during which the breaches occurred. It also said that it could not be accepted that the applicants held an honest belief that they were authorised under the explosives legislation to store and pack ammunition at the Barracks Road property, when the licence to manufacture specified the Doug McWilliams Road property as the only place for storage.
138 It is difficult to accept that, at the time of the breaches referred to above, Mr Casella had an honest belief that the ammunition "was adequately covered by s 65 of the Firearms Act 1996" once it left the licensed premises… As indicated above, Mr Casella's conduct was largely driven by what he perceived to be safe and not by any understanding of legislative requirements.
139 Mr Boyle maintained the position that, once the ammunition had been sold, it was no longer Bronze Wing's responsibility. This belief may have been honestly held. Mr Boyle may also have honestly held the belief that there was no need to inform WorkCover about storing ammunition in shipping containers, or to amend the security plan to reflect this. However, if Mr Boyle honestly held these beliefs, this indicates an unfitness on his part to hold a security clearance and is also indicative that Bronze Wing is unfit to hold a licence whilst Mr Boyle is its responsible person under s 10A(2) of the Explosives Act 2003. As indicated above, fitness involves honesty, knowledge and ability. Mr Boyle clearly did not have the requisite knowledge of the explosives legislation, and took no steps to ensure that his interpretation of the legislation was correct. It would have been a simple step to contact WorkCover to check whether it was acceptable to store explosives in a shipping container and to package explosives at the Barracks Road property.
140 Mr Boyle gave evidence that he made an enquiry of WorkCover by email in February 2013 about whether there is a requirement for a transport operator to "have a DG licence when transporting class 1.4S (ammunition cartridges) by road" and WorkCover confirmed there was not. However, there is no evidence that Mr Boyle made any enquiries of WorkCover concerning the conduct of Bronze Wing and persons acting on its behalf in transporting ammunition and packaging it offsite. Mr Boyle's evidence that he did not believe it was necessary for an employee of Casella Management to hold a security clearance when transporting ammunition to the Barracks Road property does not take account of the context of the email exchange (an enquiry about a transport operator). Nor does Mr Boyle explain how the email contributed to his belief that packaging and storage of ammunition at the Barracks Road property were lawful (if it did).
141…
142 Bronze Wing's breaches of the Explosives Act 2003 occurred over a significant period of time. A large number of individuals handled ammunition at the Barracks Road property with Bronze Wing's authority, without security clearances and without being supervised by a person with a security clearance. Ammunition was stored and handled by Bronze Wing other than in accordance with its licence. Even if Bronze Wing did not deliberately contravene the explosives legislation, Bronze Wing was reckless as to its compliance with that legislation. It did not take reasonable steps to ensure that its conduct was compliant.
Later in its decision (at J151 to J155), the Tribunal revisited these conclusions regarding Mr Boyle, in the course of determining how its view of his 'conduct, reputation and character' should affect its decision as to the fitness of Bronze Wing to hold a licence. It held that his 'character and reputation' had not been impugned. But it made the following observations about his conduct:
153 Mr Boyle knew about and authorised the handling of explosives at the Barracks Road property (including the packaging of explosives by unsupervised individuals without security clearances) in 2013 and 2014 and the storage of explosives in shipping containers at the Doug McWilliams Road property from the commencement of Bronze Wing's manufacturing licence. Mr Boyle did not inform WorkCover of either matter.
154 Mr Boyle gave evidence that he had no knowledge of the explosives stored at the Wood Road property. This is consistent with Mr Casella's evidence that he did not inform Mr Boyle that he had moved ammunition there, or that he had found propellant there. I am not persuaded that Mr Boyle knew that explosives were stored there or that Mr Casella had moved ammunition there from the Barracks Road property.
155 Mr Boyle's past conduct includes the authorisation of Bronze Wing's breaches of the requirements of the explosives legislation over a significant period of time. Such conduct tends to suggest that Bronze Wing is not a fit and proper person to hold a licence whilst Mr Boyle is its only responsible person.
Mr McGrath's principal argument on this matter, contained in his oral submissions, was that it was not manifestly clear from the explosives legislation that the conduct which the Tribunal found to have contravened it did in fact involve any contravention. In these proceedings, he said, the Tribunal had made rulings on questions of interpretation of the legislation which had not previously been determined and to which the answers were not obvious. The Tribunal at J139 held that Mr Boyle's views on these questions, while incorrect, were honestly held.
In this context, Mr McGrath referred in his submissions in reply to what he called 'carve-out' provisions operating alongside the regulatory regime established by the Act and the Regulation. These, he explained, were detailed provisions of the Firearms Act, the Explosives Code and a number of other instruments (some of which, such as the Australian Standard AS 2187 Explosives - Storage, transport and use, are mentioned in the definitions clause (cl 3) of the Regulation) modifying and elaborating the provisions of the Act and the Regulation regarding the 'handling' of explosives. (Material of this nature formed part of the bundle filed by the Appellants after the appeal hearing (see [178] above).) Mr McGrath's argument based on the existence of 'carve-out' provisions was that the determination of what could or could not be done in the handling of explosives was a complex and demanding task and that for his further reason any incorrect views on this matter that Mr Boyle held should not have been characterised as unreasonable.
Mr McGrath submitted that since these views were obviously 'arguable' at least, the Tribunal erred in reaching two important conclusions. These were (a) that because Mr Boyle held them he was unfit to hold a security clearance (see J139) and (b) that Bronze Wing, which had been 'reckless as to its compliance' with the legislation and had failed to 'take reasonable steps to ensure that its conduct was compliant', was unfit to hold any licence so long as Mr Boyle was the 'responsible person' (see J139 and J142).
Mr El Hage's primary submission on this matter was that the evidence on which the Tribunal based these two conclusions was sufficient for this purpose. He placed particular emphasis on passages in the transcript of Mr Boyle's cross-examination which demonstrated (as the Tribunal found at J139) that his knowledge of relevant parts of the Act and the Regulation was defective.
In one of these passages (Transcript, 17.11.14, p 93, lines 10 to 30), Mr Boyle stated that when including the phrase 'the provisions of the Act in relation to storage' in his affidavit he was referring to the Firearms Act. He employed this phrase with reference to the shipping containers in which Bronze Wing had stored ammunition at the Premises. After studying for more than a minute a copy of the Firearms Act that was given to him in the witness box, he could not identify any such provisions.
In another passage (Transcript, 17.11.14, p 95, line 42 to p 96, line 11), he stated that at the time when Mr Mancinelli transported ammunition from the Premises to Barracks Road, he (Mr Boyle) was not aware that the Act required a person to have a security clearance before handling any explosives. He modified this statement by saying that he 'didn't realise the individual had to have a security clearance to moved finished product, 1.4S'. He acknowledged, however, that the 'finished product, 1.4S' was an explosive and that at this time he was the 'nominated person' for Bronze Wing.
Mr El Hage pointed out that under s 19(4)(d) of the Act the 'responsible person' for a corporate licence holder must have 'satisfied the corporation' that he or she 'has the relevant knowledge, experience and qualifications to supervise the activities authorised under the licence'. Despite this, Mr Boyle had demonstrated in the witness box that his knowledge of the Act and the Regulation was inadequate. In addition, as the Tribunal found at J139 and J140, he had not taken the 'simple step' of contacting WorkCover regarding the acceptability of storing explosives in a shipping container or packaging explosives at Barracks Road, even though he had made enquiries to WorkCover about another aspect of the legislation relating to transporting explosives.
Mr El Hage's arguments did not address the submission, made in reply by Mr McGrath, that on account of the 'carve-out provisions' the ascertainment of what was permissible when handling explosives was a particularly complex and demanding task.
In our opinion, Mr El Hage's primary submission was correct: the evidence on which the Tribunal based the two conclusions stated above at [187] was sufficient for this purpose. Mr Boyle's testimony during the two episodes in his cross-examination that we have just described demonstrated a serious lack of knowledge of the relevant legislation, given that he was the 'responsible person' for Bronze Wing under s 19 of the Act. (We say this even though the proposition which was put to him in the second of these episodes did not take full account of the terms of cl 20(1)(c) of the Regulation.) His failure to contact WorkCover to clarify doubts about the operation of the legislation tells against him. If Mr McGrath was correct in describing Mr Boyle's views on the legislation as 'at least arguable', Mr Boyle should himself have realised that their correctness was or might be open to doubt and should have taken the simple step of seeking advice from WorkCover. The impact of Mr McGrath's submission based on the complexity of the 'carve-out provisions' is weakened by the fact that he did not point to any such provision that might have diluted or otherwise modified the legislative obligations of particular relevance to these proceedings.
'Propensity to reoffend'. Under this heading, the Tribunal recorded the following observations at J156 to J159:
156 The final matter put by the applicants was that there was no propensity to reoffend, in that Mr Boyle had diligently corrected all minor matters raised by Inspector Brooks in his report and there is no suggestion that Ms Rothwell or Mr Boyle would continue to knowingly breach any rule of regulation attached to the Bronze Wing licences.
157 The respondent said in reply that Ms Rothwell had not acknowledged any of the company's past breaches and that Ms Rothwell and Mr Boyle did not have proper familiarity with the explosives legislation, meaning that the Tribunal could not be satisfied that breaches by the company will not be repeated.
158 The evidence that Mr Boyle has taken steps to remedy issues identified by Inspector Brooks in the audit conducted in October 2014 is encouraging, and supports the applicants' submissions about their fitness and propriety. However, this is not conclusive of whether there is a propensity to reoffend. Mr Boyle's past conduct, and his evidence under cross examination, indicated that he does not have a good understanding of the requirements of the explosives legislation, and that he does not take proper steps to check with the regulator whether conduct which might breach that legislation (such as packaging explosives off-site) does in fact breach it. Notwithstanding Ms Rothwell's claim to be "reasonably familiar" with the requirements for storage of ammunition, Ms Rothwell did not demonstrate a good understanding of the explosives legislation when being cross examined. The primary submissions made on behalf of both applicants were that conduct which breached that legislation was in fact compliant with it.
159 In these circumstances, I cannot be satisfied that the applicants have no propensity to reoffend.
Earlier in its decision, at J149, the Tribal had held that, on the evidence before it, there was 'nothing about Ms Rothwell's character or reputation which would detract from Bronze Wing's fitness or propriety to hold a licence'.
The Appellants' submissions regarding these paragraphs quoted from the Tribunal's decision included the following propositions: (a) its conclusion was contrary to its earlier findings as to the good character of Mr Boyle and Ms Rothwell and to the accepted evidence that Mr Boyle had rectified audit defects, conducted propellant audits and taken steps to remedy issues identified by Inspector Brooks; (b) the Tribunal should have presumed that Mr Boyle and Ms Rothwell, being of good character, would ensure compliance with the legislation once the relevant aspects of it had been explained to them; (c) the Tribunal had omitted to take into account the fact that any past deficiency in Ms Rothwell's familiarity with the legislation would have been rectified during the Tribunal proceedings, since her involvement in them would have 'led to an intimate knowledge of the statutory regime'; and (d) since the Tribunal had dismissed one of the two grounds (breach of conditions attached to Bronze Wing's licences) on which WorkCover had cancelled these licences and the Internal Review decision had affirmed the cancellation, neither Ms Rothwell nor Mr Boyle should be held to lack fitness on account of their decision to institute proceedings in the Tribunal.
These submissions also referred to the following principles regarding fitness and propriety, which were stated by Toohey and Gaudron JJ at paragraph 36 of their judgment in Australian Broadcasting Tribunal v Bond [1990] HCA 33; 170 CLR 321 and were quoted by the Tribunal in the present case at [57]:
36. 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" 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 the 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.
In Mr McGrath's submission, the Tribunal, in this part of its decision, had erred in law through taking account of irrelevant matters and failing to take account of matters to which the law required it to have regard.
Mr El Hage's submissions were largely concerned with Ms Rothwell's position as the sole director and shareholder of Bronze Wing. We have already outlined (at [60 - 61]) the circumstances in which she was called as a witness in the Tribunal proceedings and required in cross-examination to answer questions regarding her knowledge of the Act and the Regulations. Mr El Hage argued that her answers (see Transcript, 8 December 2014, p 309, line 35 to p 312, line 180) showed that she did not have a good understanding of the requirements of this legislation regarding storage of explosives, even though she was giving them on the third day of the hearing and was the solicitor on the record for Bronze Wing. He submitted also that both Mr Boyle and Ms Rothwell should have come to realise that they were wrong in claiming that Bronze Wing had not breached the legislation, but had nevertheless maintained, both before and throughout the Tribunal proceedings, that no breach had occurred.
Having regard particularly to these aspects of the evidence, Mr El Hage submitted that the Tribunal's conclusion stated at J159 was clearly open to it.
In determining this question, we believe it to be important to take account of the limited nature of the Tribunal's finding. It did not find that the Appellants had a 'propensity to offend', but that it could not be satisfied that they had no such propensity. As indicated at the commencement of J156, it made this finding in response to their claim of 'no propensity'.
The Tribunal at this point was not engaging in any 'reversal' of the proper onus of proof, if for no other reason that according to a case already cited, Nakad v Commissioner of Police NSW Police Force [2014] NSWCATAP 10 at [34], there is no onus of proof in merits review cases. It was entitled to record a distinctly cautious and limited finding on this matter. Through so doing, it limited the role that the issue of 'propensity to reoffend' could play when it came to make its final evaluation of the evidence on fitness and propriety.
After taking these considerations into account, our conclusion is that, as Mr El Hage submitted, there was evidence on which the Tribunal could properly base its ruling on 'propensity to reoffend'. As the Tribunal acknowledged, Mr Boyle's remedial actions in response to Inspector Brooks's audit constituted a factor in the Appellants' favour. But his past conduct and the deficiencies in both his and Ms Rothwell's familiarity with the legislation were negative factors of sufficient weight to preclude any ruling by us that there was no probative evidence to support the Tribunal's limited finding.
As indicated above, Mr McGrath claimed that the Tribunal erred in law through taking account of irrelevant matters and ignoring matters to which the law required it to have regard. We agree that the Tribunal did not advert to one matter that it should, according to him, have taken into consideration. This was that the Appellants' decision to institute the Tribunal proceedings (which were not suggested to be improper in any way) was vindicated because the Tribunal dismissed one of the two grounds on which WorkCover had cancelled Bronze Wing's licences and the Internal Review decision had affirmed the cancellation. Equally, the Tribunal did not draw an inference that according to Mr McGrath it should have drawn: namely that Ms Rothwell's involvement in the proceedings would have 'led to an intimate knowledge of the statutory regime'.
A further matter mentioned during the appeal hearing was Ms Rothwell's dual (and, in our opinion, somewhat awkward) role in the proceedings as the director and sole shareholder of Bronze Wing and as its solicitor. It can be argued that in the latter capacity she was obliged to ensure, consistently with her duties to the Tribunal, that the best possible case on Bronze Wing's behalf was presented. In arriving at our conclusions on this part of the appeal, we have endeavoured to take proper account of the extent to which this professional obligation to Bronze Wing could legitimately induce her to 'exaggerate' (for want of a better word) the strength of its case.
In our opinion, however, the significance of all these matters is substantially diminished by the evidence that even at the time of the Tribunal hearing neither Ms Rothwell nor Mr Boyle appeared to have come to grips with the provisions within the legislation on which WorkCover's case was based. Our conclusion that the Appellants had not established any error of law in this part of the Tribunal's decision is based, to a significant degree, on this aspect of the evidence.
[22]
The correctness of the Tribunal's conclusions on fitness and propriety
We have already quoted the paragraphs in the Tribunal's decision (J160 to J165) in which it summarised the matters that it took into account in resolving the issue of fitness and propriety with respect to each of the Appellants and set out its decisions that since neither of them was 'fit and proper' Bronze Wing's licences and Mr Boyle's security clearance should be cancelled.
In the preceding sections of these reasons, we have dealt with virtually all the submissions put by Mr McGrath in challenging these decisions of the Tribunal. There remains for consideration only an argument, relating to the respective roles of Mr Boyle and Ms Rothwell within Bronze Wing, that he put to us in response to a question from the Bench.
Mr McGrath maintained that in assessing all the factors relevant to determining whether Bronze Wing was fit and proper to hold a licence under the Act, the Tribunal should have borne in mind that at the time of the hearing Ms Rothwell, as sole director and shareholder, was the 'controlling mind' of Bronze Wing and Mr Boyle, by virtue of occupying a less important position, was obliged to act in accordance with her instructions. It followed, he said, that even though Mr Boyle was the 'responsible person' for Bronze Wing under the Act, the Tribunal should have attached less weight to his character, reputation and conduct than to these attributes of Ms Rothwell. Through failing to do this, it failed also to take due account of the fact that according to its findings Ms Rothwell, unlike Mr Boyle, had no record of past involvement in breaches of the Act. These unsatisfactory aspects of its reasoning, according to Mr McGrath, constituted an error of law, in consequence of which its ultimate conclusion that Bronze Wing was not fit and proper to hold a licence was unsafe and should be set aside.
In our opinion, this submission is undermined by evidence that Ms Rothwell herself gave during cross-examination. The following questions and answers, bearing on her decision to accept appointment as director of Bronze Wing, are to be found in the transcript (8.12.14, p313, lines 38-46):
Q. Presumably, also, your lack of experience in the industry would have caused you to hesitate to become a director if it were operational?
A. Look, not really. What I would have done in that circumstance, I would have sat down with the key players. Clearly Mr Boyle as the security holder. I would have wanted to have been satisfied as to his expertise because, in essence, he would be the person that's on the day-to-day ground, so I would want to make sure that that was - I was very comfortable with that…
Later in cross-examination (see Transcript, 8.12.14, p 318, lines 2-5), Ms Rothwell said of Mr Boyle that he is the security holder and 'has the actual legal responsibility for the day-to-day manufacturing'. As examples of the decisions that she would make, she then suggested the following: 'who do the pay, what do we get in, where do we manufacture…' Towards the end of her cross-examination (Transcript, 8.12.14, p 326, lines 23-25), she said: 'My view is the director has the legal responsibility and Mr Boyle has the operational responsibility'.
The questions of compliance with the legislation with which these proceedings have been concerned have arisen in the context of 'day-to-day manufacturing' and would be squarely within the remit of the person with 'operational responsibility'. In the light of this evidence from Ms Rothwell, there is no foundation for Mr McGrath's claim that in determining the issue of fitness and propriety with regard to Bronze Wing, the Tribunal should have treated the relevant attributes of Mr Boyle as of lesser importance than those of Ms Rothwell.
This completes our consideration of the grounds of appeal in this case. Our conclusions provide no basis for doubting the correctness in law of the Tribunal's decision affirming the cancellation of Bronze Wing's licences and Mr Boyle's security clearance on the ground of 'fitness and propriety' stated in in s 21(b) of the Act.
Since we have discerned no error of law and in the absence of any other grounds put to us by the Appellants, we refuse their application under s 80(2)(b) of the Civil and Administrative Tribunal Act 2013 for leave to extend this appeal to matters other than questions of law.
[23]
Our orders
For the foregoing reasons, the appeal brought by Mr Boyle and Bronze Wing is dismissed.
In accordance with a request made by Mr McGrath, to which Mr El Hage raised no objection, we order that the stay, granted by the Appeal Panel on 2 June 2015, of Orders 1 and 2 made by the Tribunal on 5 May 2015 is to continue for 28 days following the date of this decision and is then to be discharged.
I hereby certify that this is a true and accurate record of the reasons for decision of the New South Wales Civil and Administrative Tribunal.
Principal Registrar
I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales.
Registrar
[24]
Amendments
01 September 2015 - Date of orders and decision changed to 1 September 2015
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: 01 September 2015