Callychurn v Australian Securities and Investments Commission

Background 6 On or around 24 December 2010, ASIC granted UMS an Australian credit licence, effective from that date. Ms Callychurn's now former de facto partner, Mr Rudy Frugtniet, was the sole director, secretary and shareholder of UMS at the time the credit licence was granted. Mr Frugtniet was named as the key person and one of the fit and proper persons in UMS' credit licence. 7 On 16 June 2011, Ms Callychurn was appointed a director of UMS. 8 On 14 October 2011, Mr Frugtniet ceased to be a director of UMS. During the period from 14 October 2011 to 28 April 2015, Ms Callychurn was the sole director and shareholder of UMS. 9 Before proceeding further with the chronology, the following should be noted. The Victorian Legal Services Board brought proceedings against Mr Frugtniet in the Victorian Civil and Administrative Tribunal (VCAT) seeking an order, pursuant to Division 3 of Part 2.2 of the Legal Profession Act 2004 (Vic), for the disqualification of Mr Frugtniet from practising as a lay associate of a legal practice in Victoria for a period of three years without the approval of the Legal Services Board (the VCAT proceeding). On 8 April 2011, VCAT made the order sought. The order was made on the basis that Mr Frugtniet had intentionally misrepresented himself to a barrister and a magistrate as a lawyer who was entitled to appear before the Victorian Magistrates Court. Mr Frugtniet appealed VCAT's order to the Supreme Court of Victoria, which appeal was subsequently dismissed on 13 August 2012. 10 On 24 November 2011, Ms Callychurn commenced as one of UMS' fit and proper persons for the purposes of UMS' credit licence. 11 On 5 February 2012, Ms Callychurn lodged with ASIC an annual compliance certificate on behalf of UMS for the compliance period ending 24 December 2011. 12 On 12 January 2013, Mr Frugtniet ceased to be one of UMS' fit and proper persons. 13 On 6 February 2013, Ms Callychurn lodged with ASIC an annual compliance certificate on behalf of UMS for the compliance period ending 24 December 2012. 14 On 6 March 2013, Mr Frugtniet ceased to be the key person on UMS' credit licence, at which time Ms Callychurn became the key person. 15 On 27 March 2014, ASIC issued a notice to UMS pursuant to s 266 of the Act, requiring production of certain books of the company. On that same day, ASIC also issued a notice to Ozwide Financial Services Pty Ltd (Ozwide) pursuant to s 267 of the Act, requiring production of certain books of the company. Ms Callychurn was the sole director and sole shareholder of Ozwide. 16 On 26 June 2014, a delegate of ASIC made a banning order against Mr Frugtniet which prohibited him from engaging in credit activities. On 6 March 2015, the Tribunal affirmed that decision. Mr Frugtniet appealed to the Federal Court from the Tribunal's decision. On 22 August 2016, the Court ordered that his appeal be dismissed (Frugtniet v Australian Securities and Investments Commission [2016] FCA 995). 17 On 27 February 2015, a delegate of ASIC made a banning order under s 80(1) of the Act against Ms Callychurn which prohibited her from engaging in any credit activities for five years. Further, that delegate also decided to cancel UMS' credit licence pursuant to s 55(1) of the Act. 18 On 26 March 2015, the applicants applied to the Tribunal for review of the delegate's decisions. 19 On 28 April 2015, Ms Madeleine Yasmin Seyfarth was appointed as a director of UMS. On 2 June 2015, Ms Seyfarth resigned as director of UMS. At that time Mr David Fu was appointed as company secretary of UMS.

PROCEEDINGS before the tribunal 20 On 2 June 2015, the Tribunal heard the applicants' application for a stay and the substantive application for review of the delegate's decisions. On 18 June 2015, the Tribunal decided that it was inappropriate for a stay to be granted. On the stay application it gave an oral decision on 18 June 2015 with written reasons published on 5 August 2015 ([2015] AATA 567). 21 After the Tribunal heard the substantive hearing, the applicants subsequently made further applications to the Tribunal, including an application for Deputy President Professor Deutsch to recuse himself on the ground of apprehended bias and an application to re-open the hearing to receive fresh evidence. On 18 September 2015, Deputy President Deutsch refused the application to recuse himself and the application to re-open the hearing (see the Tribunal's reasons at [2015] AATA 726). 22 On 16 October 2015, the applicants made a further application to the Tribunal to re-open the hearing and consider further submissions. On 9 December 2015, the Tribunal conducted a directions hearing in relation to the further applications made by the applicants. 23 On 29 February 2016, the Tribunal delivered its decision with reasons ([2016] AATA 114). 24 The Tribunal found that the power to make a banning order against Ms Callychurn under s 80 of the Act had been enlivened. 25 First, the Tribunal found that Ms Callychurn had contravened "credit legislation" (see ss 5(1) and 80(1)(d) of the Act). The Tribunal found that in 2012 and 2013, Ms Callychurn had contravened s 225(5) of the Act. On each of those two occasions, Ms Callychurn had lodged with ASIC an annual compliance certificate on behalf of UMS and failed to take reasonable steps to ensure that she did not make, or authorise the making of, a statement in the certificate which was false in a material particular or materially misleading. In particular, the Tribunal found that, on each occasion, Ms Callychurn had failed to take reasonable steps to ensure that she did not make, or authorise the making of, a false or misleading statement about disciplinary action and other proceedings against Mr Frugtniet. 26 Second, the Tribunal found that there was reason to believe that Ms Callychurn was not a fit and proper person to engage in credit activities. The Tribunal referred to a number of matters to support this finding. The Tribunal noted that by 2013, Ms Callychurn was the sole director of UMS. For the purposes of its credit licence, she was UMS' key person and its only fit and proper person. By this time, Mr Frugtniet had ceased to hold any such position. The Tribunal found that Ms Callychurn had nonetheless relinquished control of UMS' affairs to Mr Frugtniet at this time. The Tribunal found that she had failed in her duties as the sole director and had shirked her responsibilities as a key person and a fit and proper person. Further, the Tribunal found that in her role as director of two companies, Ms Callychurn had without satisfactory explanation failed to comply with statutory notices issued by ASIC for the production of books and records. Further, the Tribunal considered it relevant that Ms Callychurn had failed to disclose to ASIC that Ms Seyfarth (who had been appointed director of UMS) was in fact Mr Frugtniet's niece and had been bankrupt between 2004 and 2007. More generally, the Tribunal considered (at [72]) that whether or not there was reason to believe that Ms Callychurn was likely to contravene credit legislation: The pattern of behaviour over recent years suggests that there is some reason to believe that Ms Callychurrn lacks the knowledge, skill, experience and judgement which is required particularly in relation to the conduct of the business of UMS and its relations with and disclosure obligations towards the Respondent. 27 In fairness to Ms Callychurn, the Tribunal referred to factors which pointed to "some change in her behaviour" but found that they were "of limited relevance" in assessing whether or not Ms Callychurn was "likely to breach credit laws in the future". 28 Generally, the Tribunal found that it was appropriate to exercise the power to make a banning order against her. The Tribunal substituted a banning order of four years' duration. 29 As to UMS' credit licence, the Tribunal considered that as Ms Callychurn was the sole director of UMS and there was no adequate information about any appropriate alternative director, cancellation of UMS' credit licence should follow the banning order against her. Accordingly, the delegate's decision was affirmed on this aspect.

ANALYSIS 30 It is now convenient to deal with each of the applicants' grounds in turn by reference to the articulated questions of law, some of which I must say lacked conceptual coherence.

Ground 1 31 The first question of law cited by the applicants is as follows: Whether the Tribunal erred in applying the correct legal test and misapplied the legal principles which govern the proper statutory construction to s 225 (2) and (5) of the National Consumer Credit Protection Act 2010 (the Credit Act) in relation to the 2011 Annual Compliance Certificate which was pre-conditioned upon consideration of s 225 (6) which created a criminal offence upon which the standard of proof required that the balance of probabilities predicated on the Briginshaw standard be applied but was not done. Tribunal Consideration at [14-27] and Decision at [28- 29] 32 The applicants appear to assert that the Tribunal's decision to make a banning order was a considerably punitive and serious measure and therefore the Tribunal should have applied the Briginshaw standard. 33 It is not apparent to me that the principles in Briginshaw v Briginshaw (1938) 60 CLR 336 were required to be applied by the Tribunal (cf s 33(1) of the Administrative Appeals Tribunal Act 1975 (Cth) and see also Sullivan v Civil Aviation Safety Authority (2014) 226 FCR 55 at [114] to [122] per Flick and Perry JJ). But even if those principles had applied, the Tribunal did not in substance fail to adhere to them. The Tribunal was comfortably satisfied of the basis for its findings. Those findings did not rest on inexact proofs, indefinite testimony, or indirect inferences. 34 I am not in doubt that it was open to the Tribunal to find that Ms Callychurn had failed to comply with s 225(5) of the Act; although ground 1 refers to the 2011 certificate, I would also say this in relation to the 2012 certificate. Ms Callychurn was the sole director and shareholder of UMS and had responsibility for managing its affairs as well as authority to make decisions in relation to the allocation of its resources. She was required to sign the annual compliance certificates for UMS and ensure that UMS lodged those certificates with ASIC. Moreover, she signed those certificates and lodged them with ASIC. It was well open to the Tribunal to find that Ms Callychurn had failed to take reasonable steps to ensure that she did not make, or authorise the making of, false or misleading statements in the relevant annual compliance certificates. 35 The relevant test under s 225(5) is expressed in objective terms. Moreover, even if non-compliance can give rise to criminal liability (s 225(6)), that does not detract from the fact that s 225(5) is an objective test that can carry civil consequences. 36 It is well apparent to me that the Tribunal's findings were well open on the evidence and that there was no misapplication or misconstruction of s 225(5). Further, I am not persuaded that the Tribunal did not take into account the gravity of the context and consequences in making such a finding. 37 For completeness, I note that the applicants' question of law also identifies s 225(2), but it is apparent from [28] of the Tribunal's reasons that the finding of contravention is supported by reference to s 225(5). 38 Generally speaking, Ms Callychurn's assertions are little more than an attack on the merits of various factual findings that were open to the Tribunal. No error of law is established.

Ground 2 39 The second question of law is expressed as follows: Whether the Tribunal erred in the inferences it did draw from the facts as found from 2011 Annual Compliance Certificate being a restriction or right to carry on business as lay associate, or as a lawyer, that the Appeal to the Court of Appeal were disciplinary proceedings which were current or pending that may result in disciplinary action being taken by confirmation of VCAT's order and the failure of the Tribunal to consider the special rules in respect of who can sign the annual compliance certificate given that UMS was the body corporate having no CEO it was Mr Frugtniet as the responsible Manager and not Ms Callychurn. Tribunal Consideration at [14-27] and Decision at [28-29] 40 The applicants referred to a document published by ASIC entitled "About the Australian credit licence annual compliance certificate" which set out the questions asked by ASIC when an Australian credit licensee completes the annual compliance certificate. The compliance certificate required Ms Callychurn on behalf of UMS to certify various matters about its "fit and proper" people. The Tribunal found that Ms Callychurn had made misleading statements in relation to these matters. The Tribunal found that Ms Callychurn had failed to disclose that Mr Frugtniet, who was named as UMS' fit and proper person, had been subject to the VCAT proceeding. Further, the Tribunal found that Ms Callychurn failed to disclose that Mr Frugtniet had been subject to a disqualification order which prohibited him from practising as a "lay associate" in legal practice. 41 The compliance certificate required the credit licensee to certify that it had no reason to believe that any of its fit and proper people had been: (a) "refused the right or been restricted in the right to carry on any trade, business or profession for which an authorisation (licence, certificate, registration or other authority) is required by law"; (b) "subject to disciplinary action in relation to any such authorisation"; (c) "subject of any … proceedings that are current or pending and which may result in disciplinary action being taken in relation to any such authorisation". 42 The applicants asserted that it was not necessary for Ms Callychurn to disclose that Mr Frugtniet was subject to the VCAT proceeding. 43 The applicants further submitted that the disqualification order against Mr Frugtniet did not constitute a refusal of the right or a restriction of a right to carry on any trade, business or profession for which an authorisation was required by law. The applicants contended that practising as a "lay associate" did not require any "authorisation" at law. As such, so the applicants contended, there was no relevant restriction on Mr Frugniet's right to practice as a lay associate. 44 The applicants submitted that Mr Frugtinet was not subject to any "disciplinary action" which needed to be disclosed in the compliance certificate. It was said that such disciplinary action had to be "in relation to" the relevant authorisation. The applicants asserted that Mr Frugtniet was not subject to any authorisation to practise as a lay associate, and the VCAT proceeding was not a "disciplinary action" that had to be disclosed as that proceeding was not in relation to any relevant authorisation. 45 The applicants submitted that the VCAT proceeding could not be characterised as a "disciplinary action". The applicants say that proceedings brought under Division 3 of Part 2.2 of the Legal Profession Act 2004 (Vic) (as it was then), such as the VCAT Proceeding, were not disciplinary proceedings. They say that proceedings brought under Part 4.4 of the Legal Profession Act 2004 (as it was then) were "disciplinary proceedings". 46 Generally, the applicants submitted that Ms Callychurn had relied upon the relevant ASIC Regulatory Guide as to all the matters that needed to be disclosed in the compliance certificate. The applicants asserted that the compliance with that guide, namely for example, conducting a bankruptcy search and a credit check, amounted to taking reasonable steps to ensure that Ms Callychurn did not make a false or misleading statement in the compliance certificate for the purposes of s 225(5) of the Act. 47 Finally, the applicants referred to [27] of the Tribunal's reasons which stated: Mr Frugtniet concedes in his own statement (see T18-162) that the consequence of the VCAT order would be to put his other authorisations at risk. These included authorisations that he held which entitled him to carry on business as a conveyancer under the Conveyancers Act 2006 (VIC) and as a migration agent under the Migration Act 1958 (Cth). Again, this would seem to suggest that the answer to question three is clearly that there were proceedings pending at the time of the annual compliance date in respect of the 2011 Annual Compliance Certificate which could result in disciplinary action being taken in respect of the conveyancing and migration authorisations. 48 The "T18-162" document is a statement that was in evidence before VCAT but was also put before the Tribunal in the present case; it does not appear to me that its receipt by the Tribunal was objected to. The applicants contended that the Tribunal was in error for attributing matters disclosed by Mr Frugtniet in the VCAT proceeding to matters which Ms Callychurn ought to have known. The applicants submitted that Ms Callychurn was not a party to the VCAT proceeding. Further the applicants said that Ms Callychurn had never seen the contents of the T18-162 document. 49 First, I see no error of law established in relation to the Tribunal's conclusion at [25] relating to its characterisation of "disciplinary action", which had not been disclosed in the certificate. 50 Second, whatever the state of knowledge or belief by Ms Callychurn as to whether this was "disciplinary action", a contravention of s 225(5) was still made out concerning a failure to take the necessary reasonable steps (see the Tribunal's conclusion at [28]). Her subjective belief on characterisation did not negate the objective test. 51 Third, on any view it was open to the Tribunal to find that the certificate was materially misleading, whatever the characterisation of "disciplinary action". Moreover, Ms Callychurn sought to conflate what "disciplinary action" meant in ASIC's form with what she asserted to be the meaning under the Legal Profession Act 2004. 52 Fourth, it was open to the Tribunal to find that in substance Mr Frugtniet was restricted from acting as a lay associate and that the certificate was materially misleading in its failure to so disclose. 53 Generally, Ms Callychurn's submissions to me on this aspect were entirely unconvincing, so too it would appear to the Tribunal. Her submissions emphasised form rather than substance. There was more than adequate evidence before the Tribunal to support its finding of a contravention of s 225(5). 54 Finally on this ground 2, it was said that the Tribunal was in error (see at [27]) in taking into account Mr Frugtniet's statement to VCAT as being something that Ms Callychurn ought to have known. There is little doubt that Ms Callychurn knew the basal facts concerning the proceedings that had been taken against Mr Frugtniet. Irrespective of whether she knew Mr Frugtniet's own characterisation before VCAT does not alter the Tribunal's objective conclusion at [28]. But even if an error of law was made, in my view there was no real chance of the Tribunal's conclusions at [28] and [29] being altered, let alone any alteration to the Tribunal's orders that were based, in relation to Ms Callychurn's disqualification order, on a cumulative set of factors (cf House v Defence Force Retirement and Death Benefits Authority (2011) 193 FCR 112 at [31] and [174]). 55 I would reject ground 2.

Ground 3 56 The third question of law provides: Whether the Tribunal erred in the interpretation and construction it placed on the statutory concept under s 225 of the National Consumer Credit Protection Act 2010 (the Credit Act) in its failure to consider the definitions of "person", "misleading" and "statement" and whether they applied to Ms Callychurn or UMS. [11-13] Decision at [28-29]). 57 Principally, the applicants submitted that the Tribunal erred in its construction of the word "misleading" for the purposes of the Act. The applicants submitted that because of this erroneous construction, the Tribunal was wrong to find that the statements made in the compliance certificates were misleading. 58 The applicants appeared to contend that the word "misleading" in inter alia s 225(5) required a statement to be misleading as to a future matter and required that another person (in this case, ASIC or one of its employees or officers or perhaps even a third party) had to rely on that statement. The applicants appeared to contend that there had to be actual reliance on the offending statement for the statement to be "misleading". 59 It is plain that the definition of "misleading" in s 13(1) of the Act is not exhaustive. Section 13(1) explains when a future representation is taken to be "misleading". But section 13(1) does not require that a representation relate only to a future matter in order for it to be misleading. This is also made clear by s 13(2) which states that s 13(1) "does not limit the circumstances in which a representation may be misleading". A representation about a past or present matter is also capable of being "misleading". Moreover, reliance does not need to be established. Ms Callychurn's arguments are misconceived. No error of law is established. 60 For completeness, I should say that at the hearing before me the applicants did not press the ground that the Tribunal was in error in its construction of "person" or "statement". But in any event, any such assertions made in their written submissions were likewise misconceived.

Ground 4 61 The fourth question of law provides: Whether the Tribunal erred in the construction of the statutory criteria and whether it was satisfied that on the facts found on the 2012 Annual Compliance Certificates s 53 of the National Consumer Credit Protection Act 2010 (the Credit Act) in relation to each question as answered by UMS/Ms Callychurn as being false or materially misleading was not available on the evidence. (Tribunal Consideration [14-27] Decision at [28-29]). 62 Although it is not readily apparent from how this ground has been formulated, the applicants appeared to contend that the Tribunal was in error by finding that Ms Callychurn had provided a false or misleading statement in the 2012 compliance certificate by failing to list Mr Frugtniet as a fit and proper person of UMS. 63 The applicants submitted that they did not provide a false or misleading statement. Before the Tribunal, Ms Callychurn gave evidence that in respect of the 2012 compliance certificate, she had completed the section "Notification of ceasing to be a fit and proper person" stating that Mr Frugtniet ceased to be a fit and proper person on 12 January 2013, but that due to a computer glitch, Mr Frugtniet's name was subsequently automatically removed from the list of fit and proper people. Ms Callychurn contended that the omission of Mr Frugniet as a fit and proper person was not due to any fault of her own, but instead due to the apparent computer glitch. So much may be accepted on the evidence before the Tribunal. 64 Further, Ms Callychurn submitted that she was not able to manually add Mr Frugtniet's name to the list of fit and proper people. Ms Callychurn said it could not be said that she had made a false or misleading statement if the electronic form did not provide her with an opportunity to add Mr Frugtniet's name to the list of fit and proper people. 65 Now it is apparent that in submissions dated 16 June 2015 filed with the Tribunal after the substantive hearing, ASIC confirmed that the evidence given by Ms Callychurn was correct. It was said in those submissions (see at [4] and [5]): ASIC can now confirm that this evidence given by Ms Callychurn was correct. That is, ASIC accepts that once Ms Callychurn completed the section "Notification of ceasing to be a fit and proper person", stating that Mr Frugtniet ceased to be a fit and proper person on 12 January 2013, the form automatically operated to remove Mr Frugtniet's name from the "List of fit and proper people as at the licensee's annual compliance date" even though the date Ms Callychurn had entered for Mr Frugtniet's ceasing (12 January 2013) was after the annual compliance date. ASIC accepts that the form did not permit Ms Callychurn manually to add Me Frugtniet's name under the heading "List of fit and proper people as at the licensee's annual compliance date". Accordingly, ASIC disclaims any submission that Ms Callychurn herself removed Mr Frugniet's name from the List of fit and proper people as at the licensee's annual compliance date" in the 2012 Annual Compliance Certificate. To the extent that any cross-examination suggested that Ms Callychurn's evidence on this point was incorrect, that suggestion should not have been made and is withdrawn. 66 But notwithstanding such matters, the Tribunal found that Ms Callychurn knew, or ought to have known, that the 2012 compliance certificate contained false information, and that she should have taken reasonable steps to ensure that she did not make a statement in the document that was false or misleading. The applicants contended that the Tribunal's conclusion in this regard was erroneous. 67 First, the applicants submitted that ASIC's contact telephone number which appeared at the footer of the relevant form (when Ms Callychurn was completing the form), did not subsequently appear in the final form of the compliance certificate as submitted to ASIC. The applicants asserted that it could not be said that Ms Callychurn should have taken reasonable steps by contacting ASIC if the relevant contact number did not ultimately appear on the 2012 compliance certificate as submitted. 68 Second, the applicants submitted that the Tribunal was in error for assuming that Ms Callychurn knew, or ought to have known, that the form was false by omitting reference to Mr Frugtniet in the list of proper people. Ms Callychurn contended that it was reasonable and open for her to assume that because of the way the electronic form operated in automatically removing Mr Frugtniet's name from the list of proper people, ASIC had considered it unnecessary for his name to be listed in the compliance certificate. 69 I would reject ground 4. The applicants seek in essence a merits review of the Tribunal's factual findings and consideration at [38] to [43]. Those findings were well open to the Tribunal and do not disclose any reviewable error. It is not to the point that another decision maker may have taken a more benign interpretation of the facts than that taken by the Tribunal. 70 As ASIC correctly points out, there was no dispute before the Tribunal that during the annual compliance period ending on 24 December 2012, Mr Frugtniet was one of the named "fit and proper people" for UMS and he only ceased to hold that position on 12 January 2013. It was therefore open to the Tribunal to find that, insofar as the annual compliance certificate required provision of information about any of UMS' "fit and proper people", that requirement included provision of information about Mr Frugtniet. It was also open to the Tribunal to find that Ms Callychurn had failed to take reasonable steps to ensure that she did not make, or authorise the making of, false or misleading statements in the relevant annual compliance certificate about Mr Frugtniet and disciplinary action and other proceedings relating to him. In making its findings, I would also note that contrary to what the applicants assert, the Tribunal did take into account the circumstances surrounding the completion and lodgement of the relevant annual compliance certificate in a computerised form. Nevertheless, for the reasons the Tribunal gave at [39] to [41], it was still open to it to find non-compliance with s 225(5).

Ground 5 71 The fifth question of law provides: Whether the Tribunal erred by the denial to Ms Callychurn and UMS natural justice in its failure by nature of the content of the duty to give reasons and thus not discharging its duty by not addressing matters in relation to any of the definitions of "person", "misleading" "statement" or materiality and it's applicability to Ms Callychurn and UMS and denying to the Applicants to re-open the matter in accordance with the written application/requests made and submissions in support by the Applicants which were subsequent to any earlier decision as to what the Tribunal would consider (Tribunal Consideration Decision at [5(b)]) and upon re-listing the matter misleading the Applicants. 72 Under this ground, I need only separately address the application to re-open question. 73 After the substantive hearing on 2 June 2015, the applicants brought two separate applications to re-open the hearing and adduce new evidence. This ground relates to the second of such applications. The first of such applications was disposed of for the reasons given by the Tribunal on 18 September 2015 ([2015] AATA 726). 74 The applicants brought an application on 16 October 2015 to re-open the proceeding. Apparently the purpose of the application was because the applicants had obtained a copy of the transcript of Mr Frugniet's proceedings before the Administrative Appeal Tribunal, in which it is said that counsel for ASIC submitted that the proceedings were not disciplinary. Further, the applicants also sought, before the Tribunal, to adduce evidence from Mr Fu. 75 The applicants submitted before me that the Tribunal had denied procedural fairness to the applicants in its failure to consider the re-opening application. The applicants relied on the directions hearing on 9 December 2015, in which the Tribunal noted that it would make a determination on the application to re-open and the substantive matter. The applicants contended that the Tribunal's final reasons made no reference to the re-opening application, and that accordingly there had been no ruling on that application. It is said that in the absence of any reasons by the Tribunal, it could reasonably be inferred that the Tribunal did not properly consider the application. The applicants also contended that the failure of the Tribunal to consider the re-opening application was material, because the documents which they sought to rely on, if the matter had been re-opened, would have weighed in their favour. 76 Not without some hesitation, I have decided to dismiss the ground. My hesitation is simply on the basis that the Tribunal did not expressly deal with this application and its refusal in its final reasons, although I am prepared to infer that the Tribunal considered the application and rejected it. It is appropriate to elaborate further on the context. 77 The proceeding before the Tribunal involved various interlocutory applications by the applicants. In one of these applications, they applied unsuccessfully to have the Tribunal member recuse himself. In the course of that application, the applicants effectively asked the Tribunal to re-open the hearing. On 18 September 2015, the Tribunal refused that request (see its reasons at [2015] AATA 726). The Tribunal considered that the parties had had ample opportunity to present their respective cases. No error has been demonstrated in what the Tribunal said at [40] to [52] of those interlocutory reasons. 78 Not content with and despite the Tribunal's ruling on 18 September 2015, on 16 October 2015 the applicants made a further request that the Tribunal re-open the hearing. In doing so, they did not precisely specify any new material which they wished to put before the Tribunal. The statement in [10] of the applicants' written submissions of 16 October 2015 was vague to say the least. The applicants' further request was opposed by ASIC. ASIC submitted to the Tribunal that: The applicants' submission that the Tribunal is under an unqualified obligation to receive any relevant material, even after a hearing, before it makes a decision is wrong. It is contradicted by Re BQRW and Commissioner of Taxation (2014) 63 AAR 503, in which the cases relied upon by the applicants were thoroughly analysed. As is made clear there, as an aspect of the overall requirement to afford procedural fairness, the Tribunal possesses a discretion to re-open proceedings. In this case, that discretion has been exercised, correctly, against reopening (Re Callychurn and ASIC [2015] AATA 726). It should not be revisited. 79 On 9 December 2015, the Tribunal conducted a directions hearing, at which time it referred to the applicants' further request to re-open the hearing. At that stage the Tribunal informed the parties that it intended "to proceed to make an overall decision on all these matters, including the substantive matter". The Tribunal stated that if it did not accede to the applicants' further request to re-open the hearing, it would "then make a decision on the substantive matter as well". The Tribunal said: So really, the purpose of this directions hearing is - is basically - Ms Callychurn, I wanted to lay it out that these are the applications. The only one that has categorically been declined by the tribunal at this stage is the recusal application. The other matters I'm going to consider as part of the overall decision, but in doing so, if I come to the conclusion that the hearing is not to be reopened, I will then make a decision on the substantive matter as well. Now, I think that's the most efficient way of doing this. That way, both parties will have a decision that they will either be comfortable with or not. 80 On 29 February 2016, the Tribunal made its decision on the substantive matter. In that decision at [5(b)], the Tribunal referred to its refusal of the applicants' earlier request to re-open the hearing. But unfortunately it did not expressly refer to the further request to re-open the hearing. Nonetheless, I am prepared to infer that by and as part of making its decision on the substantive matter, the Tribunal had rejected that further request. Given that the applicants' earlier request to re-open had been refused and the applicants did not in support of their further request refer to any detailed new material, in my view the Tribunal's approach was appropriate. Ms Callychurn before me referred to "new" material that she says she would have put forward, but I cannot see how it could realistically have made a difference. The VCAT transcript would not have assisted. And in relation to Mr Fu, the Tribunal had some information (T72 lines 15 to 17) (see also its reasons at [85]) but it had clearly been deficient concerning the questions of association and control. Re-opening would not have changed the landscape. But in any event, in context, it was entirely appropriate to refuse the application to re-open. In my view, the Tribunal did not deny the applicants procedural fairness. 81 As to the absence of reasons, I am not prepared to say in the context of what occurred that this was an error of law. But if it was, it had no consequence for the Tribunal's decision and orders.

Grounds 6 and 8 82 The sixth and eighth questions of law appeared to be related. 83 The sixth question of law is expressed as follows: Whether the Tribunal erred on the facts found that the statutory criteria was not considered and satisfied as no finding of any contravention of general conduct obligations pursuant to s 47 under Consumer Credit Protection Act 2010 (the Credit Act) and could not give rise implicitly to Ms Callychurn not being a fit and proper person, with their being no positive finding made that would enliven such a finding. (Tribunal Consideration [45-65] Decision at [66]). 84 The eighth question of law provides: Whether the Tribunal erred in law by not applying the correct legal test or that facts evidenced did not fall within s 80(1)(e) in its conclusion as to whether Ms Callychurn was likely to contravene Credit Legislation in the future by engaging in speculation in relation to Mr Frugtniet's status in UMS. There is no evidence of Mr Frugtniet's involvement since his ban in 2014, neither has the Respondent suggested otherwise. The evidence by the Applicant was that all general conduct obligations have being rectified. The lack of candour about Ms Seyfarth connection to Mr Frugtniet in name or her previous bankruptcy, were conducted by lawyers in correspondence and discussions on a without prejudice basis with the Respondent, and the conclusion in relation to a lack of information in relation to David Fu is without foundation as substantial information in relation to his appointment, his qualifications, his exemption in relation credit activities being a registered tax agent including bankruptcy checks in compliance with the Credit Act were all provided to the Tribunal as the Respondent submitted that it would not consider any matters and it was up to the Tribunal to do so, therefore to suggest it is of little information as concluded by the Tribunal, was to ask the wrong question as Credit Legislation does not seek to elicit information about individuals associations. (Tribunal Consideration [72-81] Decision at [82-85]). 85 These questions of law appear to relate to the issue of whether Ms Callychurn is a fit and proper person, and whether Ms Callychurn and UMS are likely to contravene credit legislation in the future. At the outset I would note that no issue has been taken with and no criticism can be made concerning the Tribunal's exposition of principle at [44]. The applicants' submissions, as best as I am able to discern them, can be summarised as follows. 86 First, the applicants submitted that the Tribunal had failed to take into account the fact that Ms Seyfarth had resigned as a director of UMS. It is said that any concerns about Ms Seyfarth would have been alleviated by the substantive hearing before the Tribunal such that it could not be said that UMS would likely contravene credit legislation in the future. But even accepting this, the Tribunal's finding at [71] of a "troublesome pattern of non-disclosure" has not been in anyway impugned and casts significant doubt on the candour of Ms Callychurn, which is also not irrelevant to the "fit and proper" question. I would also note that the suggested "withdrawal" of the name of Ms Seyfarth by the applicants appears to have been proffered on a conditional basis (see T72 lines 17 to 21 of the 2 June 2015 hearing). No operative error of law has been established. 87 Second, the applicants submitted that Mr Fu was appointed as company secretary and was a suitable fit and proper person of UMS. The applicants contended that it could be inferred from the Tribunal's reasons that the Tribunal did not properly consider the "extensive documentation" provided to the Tribunal about Mr Fu's background and qualifications. The Tribunal observed at [77] of its reasons that "little information [had] been provided about the background, position and relationship of Mr Fu to any of the relevant parties". In my view this contention also has no substance. It is well apparent that the Tribunal at [85] considered his position and took into account what had been provided or said about Mr Wu at the substantive hearing (see T72 lines 15 to 17). In any event the material submitted after the substantive hearing did not address the full detail of what the Tribunal recited in [85] concerning the question of association and control. 88 Third, the applicants submitted that the Tribunal was in error in finding that the applicants had resisted or failed to comply with the notices issued by ASIC to Ozwide and UMS on 27 March 2014. The applicants asserted that the Tribunal appeared to find that there had been non-compliance with the ASIC notices, which they say was contrary to the fact that UMS had produced documents to ASIC, albeit after the due date for production prescribed in the relevant notice. The applicants also submitted that in relation to both notices, Ms Callychurn had been corresponding with ASIC about compliance with the notices and that it was not as if she had been silent after receiving the notices. In my view the Tribunal's findings (see at [60] to [66]) were open to it on the evidence and no error of law is established. The excuse given by Ms Callychurn for non-compliance initially with the Ozwide notice was untenable. Further, on the evidence before the Tribunal, compliance with the notices was tardy to say the least. In my view, the Tribunal's conclusion at [66] was fairly open. 89 Fourth, the applicants submitted that the 2013 and 2014 compliance certificates did not raise any concerns, which was said to constitute "proof" that it was unlikely that Ms Callychurn or UMS would contravene credit legislation in the future. But the Tribunal took this into account at [76]. No error is disclosed. 90 Fifth, the applicants said that the Tribunal was in error to find that Ms Callychurn was not a fit and proper person on the basis that she had allowed control of UMS to remain in the hands of Mr Frugtniet (after he was removed as a director of UMS). The Tribunal found that Mr Frugtniet maintained control of the receipt and processing of loan applications, the bank account of UMS, the website and complaints against the company. The applicants submitted that Mr Frugtniet's role did not amount to "control", but rather "housekeeping". Further, the applicants contended that they had transferred all of UMS' funds into a new bank account with Suncorp, and Mr Frugtniet did not have access to that new account. But on the evidence before the Tribunal, no error is disclosed in what was said at [72] to [77] and the conclusions at [78] to [82].

Ground 7 91 The seventh question of law provides: Whether the Tribunal erred in its conclusions by denying natural justice and taking irrelevant consideration of discussions and submissions pertaining to undertakings made by the Applicants with the Respondent during the proceedings as evidence notwithstanding they were confidential and without prejudice communication between the parties in relation to the negotiations with respect to undertakings concerning Ms Yasmin Seyfarth being appointed, withdrawn prior to the Tribunal hearing the matter, with the new appointment David Fu as Director of UMS being submitted. (Tribunal Consideration [67-68] Decision at [69-71]). 92 The applicants contended that the Act did not require any relationship or association between the applicants and Ms Seyfarth to be disclosed. It is said that because the Tribunal had considered that relationship, the Tribunal had taken into account an irrelevant matter. Further, the applicants contended that the Tribunal had failed to consider that it was open to the applicants to offer undertakings to ASIC. Further, it is said that when those undertakings were withdrawn prior to the substantive hearing before the Tribunal, the Tribunal should not have drawn an adverse inference from such conduct. 93 In my view these submissions lack substance and do not disclose any error of law. Moreover the "undertaking" point lacks coherence. The Tribunal was entitled to take the non-disclosure concerning Ms Seyfarth (see at [67] to [71]) into account in considering whether or not there was reason to believe that Ms Callychurn was not a fit and proper person to engage in credit activities for the purposes of s 80(1)(f). The Tribunal was entitled to take into account any matter that it considered relevant to that task.

Ground 9 94 The ninth question of law provides: Whether the Tribunal erred in law by its denial of natural justice by its predetermination of matters in the decision of the stay application that the Applicant at the very least had engaged in misleading conduct, and that it was of the firm belief that the case for the banning order of some duration in respect of the 1st Applicant and the cancellation of the licence by the 2nd Applicant was substantial, where a fair minded observer might reasonably have apprehended that the Deputy President constituting the Tribunal in the present case might not bring an impartial mind to the resolution of the question which he was required to decide. (Tribunal Consideration and Decision at [12-15] Callychurn and Anor and Australian Securities and Investments Commission [2015] AATA 567 18 June 2015. Moreover, the Applicants did not waive their rights to the constitution of the Tribunal by Deputy President Deutsch and thus did not waive their rights to rely on that objection in an appeal of the kind now before this court. Callychurn and Australian Securities and Investments Commission [2015] AATA 726 (18 September 2015) 95 The applicants relied on the following comments made by Deputy President Professor Deutsch in their stay application: Without seeking to conclude, it is my firm belief that the case for a banning order of some duration in respect of Ms Callychurn and the cancellation of the licence is substantial. 96 The applicants contended that on the basis of those comments, the tribunal member had pre-determined the substantive matter by referring to some form of penalty applying in the substantive matter as a reason for refusing the stay application. The applicants submitted that it was sufficiently clear to a fair minded observer that the Tribunal might have pre-determined the matter and might not bring an impartial mind to the matters at hand. 97 In my view, the applicants wrongly decontextualise the observations. Both the substantive hearing and the stay application were heard on 2 June 2015. An oral decision was given on the stay application on 18 June 2015 with written reasons published on 5 August 2015 ([2015] AATA 567). The relevant comments (see also [2015] AATA 567 at [11]) were made after the final hearing when the Tribunal, unremarkably, had been fully informed on the evidence and the issues and well placed to make confident, albeit not final, statements on the merits. A fair-minded lay observer would well appreciate that context. 98 I do not consider that the applicants go anywhere close to establishing that a fair-minded lay observer might reasonably apprehend that the Tribunal might not bring an impartial mind. Further, given the context of the stay application, the prospects of success were a relevant consideration. The Tribunal was within its rights to express views thereon albeit not concluded views. I see no error in the Tribunal's interlocutory reasons on the apprehension of bias ground ([2015] AATA 726 at [11], [15] to [19] and [34] to [39]). Further, considering the matter for myself, no apprehension of bias ground is made out.

Other matters 99 Ms Callychurn made submissions on other matters which did not neatly fit under the applicants' articulated questions of law. It is convenient to deal with them briefly. 100 First, Ms Callychurn spent some time before me seeking to demonstrate that the structure or management of UMS had been "reformed" and that on the evidence before the Tribunal, the order cancelling UMS' licence should be set aside. I found her submissions entirely unconvincing as to the merits of her assertions. But in any event, the question is whether the Tribunal made an error of law. None has been demonstrated (see the Tribunal's reasons at [83] to [85]). 101 Second, Ms Callychurn in relation to her personal position has taken issue with the Tribunal's statements and conclusions at [72] to [82]. I must say that in my view I thought the Tribunal's analysis to be balanced and fair. No error of law is disclosed. Her submissions in substance amounted to a merits challenge.

CONCLUSION 102 No error of law as attempted to be articulated by the applicants has been made out. And in any event, even if such an error had been established I see no realistic possibility that the Tribunal's determination and orders would have been any different. To set aside the Tribunal's determination and orders and remit would be an exercise in futility even if an error of law had been established. 103 The applicants' appeal must be dismissed with costs. I certify that the preceding one hundred and three (103) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Beach.