Court of Appeal (WA)|2017-04-21|Before: Martin CJ

CENTEX AUSTRALASIA PTY LTD -v- COMMISSIONER FOR CONSUMER PROTECTION [2017] WASCA 79 (21 April 2017)

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA

CITATION : CENTEX AUSTRALASIA PTY LTD -v- COMMISSIONER FOR CONSUMER PROTECTION [2017] WASCA 79

Jurisdiction : STATE ADMINISTRATIVE TRIBUNAL OF WESTERN AUSTRALIA

Citation : COMMISSIONER FOR CONSUMER PROTECTION and CENTEX AUSTRALASIA PTY LTD [2015] WASAT 129

Appeal from decision of State Administrative Tribunal finding that appellants had breached duty as real estate agents to act fairly and honestly - Challenges to findings of fact - Principles to be applied upon review of findings of fact by appellate court - Whether reasons given by Tribunal were adequate - Whether appellants were denied procedural fairness - Appeal allowed - Orders of Tribunal set aside and substituted

Orders of the State Administrative Tribunal set aside and substituted

CSR Ltd v Della Maddalena [2006] HCA 1

Armstrong v Commissioner for Consumer Protection [2014] WASCA 71

Beale v Government Insurance Office (NSW) (1997) 48 NSWLR 430

Collector of Customs v Pozzolanic Enterprises Pty Ltd (1993) 43 FCR 280

Commissioner for Consumer Protection and Centex Australasia Pty Ltd [2015] WASAT 129

Dearman v Dearman [1908] HCA 84; (1908) 7 CLR 549

Esther Investments Pty Ltd v Markalinga Pty Ltd (1989) 2 WAR 196

Garrett v Nicholson [1999] WASCA 32; (1999) 21 WAR 226

Johnson v Sheppard [2005] WASCA 13

Manonai v Burns [2011] WASCA 165

Minister for Immigration and Ethnic Affairs v Wu Shan Liang [1996] HCA 6; (1996) 185 CLR 259

Mount Lawley Pty Ltd v Western Australian Planning Commission [2004] WASCA 149; (2004) 29 WAR 273

Paridis v Settlement Agents Supervisory Board [2007] WASCA 97; (2007) 33 WAR 361

Plaintiff M64/2015 v Minister for Immigration and Border Protection [2015] HCA 50

Public Service Board of New South Wales v Osmond [1986] HCA 7; (1986) 159 CLR 656

Riley v The State of Western Australia [2005] WASCA 190; (2005) 30 WAR 525

Robinson Helicopter Co Inc v McDermitt [2016] HCA 22

Secretary to the Department of Premier and Cabinet v Hulls [1999] VSCA 117; (1999) 3 VR 331

Simonsen v Legge [2010] WASCA 238

SNF (Australia) Pty Ltd v Jones [2008] WASCA 121

Wingfoot Australia Partners Pty Ltd v Kocak [2013] HCA 43; (2013) 252 CLR 480

Zampatti v Western Australian Planning Commission [2010] WASCA 149

1 Mr Rick Anthony Bantleman is a licenced real estate agent. He is also the sole director and secretary of Centex Australasia Pty Ltd (Centex), which is also a licenced real estate agent. The Commissioner for Consumer Protection (the Commissioner) commenced proceedings in the State Administrative Tribunal (the Tribunal) seeking a determination that there was proper cause for disciplinary action against each of Mr Bantleman and Centex,[1] on the ground that each had acted unfairly or alternatively dishonestly,[2] because, it was said, Mr Bantleman, acting on behalf of Centex, had falsely represented to Mr Edward Francis Chalwell that the terms of an amended management authority which Mr Bantleman sent to Mr Chalwell had been agreed by Centex and Mr Chalwell when in fact the amended terms had not been discussed. The Tribunal found in favour of the Commissioner and ordered that each of Mr Bantleman and Centex be reprimanded, and that their licences be suspended for a period of four months. Mr Bantleman and Centex apply for an extension of time within which to appeal from the decision, and for leave to appeal. For the reasons which follow, the extension of time sought should be granted, along with leave to appeal, the appeal allowed, the Tribunal's decision set aside, and substituted with an order dismissing the Commissioner's application.

2 The nature of the grounds of appeal necessitates a detailed analysis of the course of the proceedings in the Tribunal.

3 The Commissioner commenced the proceedings in the Tribunal with an application in which penalties were sought against each of Centex and Mr Bantleman. The application contains a statement of the grounds upon which the orders were sought from the Tribunal.

4 In those grounds the Commissioner asserted that on or about 24 December 2011 Centex entered into an exclusive authority to act as managing agent for commercial premises situated at 125 Radium Street, Welshpool with Mr Chalwell, the owner of those premises. The term of the authority was a period of five years, although after two years either party could terminate the relationship by giving 30 days notice. The management authority provided that Centex was entitled to a fee of 6% of gross annual collections from the lessee of the premises.

5 The Commissioner further asserted that on or about the same date - namely, 24 December 2011 - Mr Chalwell leased the premises to BTL Transport Pty Ltd. However, by August 2013 the lease had been terminated.

6 The Commissioner further asserted that on 6 August 2013, Mr Bantleman met with Mr Chalwell when they discussed the terms of a new lease for the premises, and negotiated the amount of the commission which would be paid to Centex in respect of the new lease. The Commissioner further asserted that on or about 16 August 2013, Centex sent an amended management authority to Mr Chalwell, in the same terms as the authority which had been executed in December 2011, except that the term of the authority was stated to be 13 years, rather than five years and the management fee was stated to be 8%, rather than 6%. The Commissioner further asserted that Mr Bantleman and Centex knew that Mr Chalwell had not agreed to the amended terms. The Commissioner asserted that by sending to Mr Chalwell an agreement containing terms which Mr Bantleman knew had not been agreed, each of Mr Bantleman and Centex had acted unfairly and dishonestly.

7 In accordance with the Tribunal's standard procedures, the Commissioner was directed to provide a statement of issues, facts and contentions (SIFC). The Commissioner slightly amended that document on the last business day prior to the commencement of the hearing in the Tribunal. In the SIFC, the essential allegations made in the application were repeated and slightly expanded. So, the Commissioner expressly asserted that during the meeting between Mr Bantleman and Mr Chalwell on 6 August 2013, there was no negotiation or discussion with respect to any amendment to the terms of the management authority.

8 After the assertions of fact which we have summarised above, in the SIFC the Commissioner expressly contended that by sending the amended management authority to Mr Chalwell, each of Mr Bantleman and Centex:

(a) falsely represented to Mr Chalwell that the amended terms had been agreed; and

(b) further or alternatively, sought to obtain by deception Mr Chalwell's agreement to the amended terms.

The Commissioner gave particulars in support of the allegation that there had been an attempt to obtain Mr Chalwell's agreement to the amended terms by deception in which it was asserted that the covering letter and the amended authority did not draw Mr Chalwell's attention to the amended terms, and were provided in the form of a poor copy which was difficult to read, increasing the chance that Mr Chalwell would not notice or appreciate the effect of the amended terms.

9 However, in the course of closing submissions the Commissioner expressly abandoned the alternative contention to the effect that there had been an attempt to gain Mr Chalwell's agreement to the amended terms by deception. As will be seen, the abandonment of this aspect of the Commissioner's case is of significance in the disposition of this appeal.

The Response to the Commissioner's statement of issues, facts and contentions

10 A Response to the Commissioner's SIFC was provided on behalf of Centex and Mr Bantleman. In that Response the Commissioner's assertions with respect to the matters which occurred prior to 6 August 2013 were generally accepted, although it was asserted that the usual management fee of Centex was 8% plus GST, but that as a gesture of goodwill towards Mr Chalwell as a new client, the lower fee of 6% was agreed on the understanding that after the initial two year period a new management authority with a term of not less than five years and a management fee of 8% plus GST would be entered into.[3]

11 In the Response it was also asserted that on the afternoon of 6 August 2013, Mr Bantleman attended Mr Chalwell's home and presented him with an Authority to Lease the premises to the new tenant which had been found by Centex. It is further asserted that Mr Chalwell requested a discounted leasing fee as a result of the early termination of lease by the first tenant, and that Mr Bantleman agreed to discount the leasing fee by an amount of approximately $7,000 plus GST on the basis that the term of the management authority would be increased from five to 13 years and that the management fee 'reverted back to the standard 8% plus GST rate'.[4] In the Response it is asserted that Mr Chalwell agreed to this proposal, after which the leasing authority was amended by hand to reflect the discounted leasing fee agreed between Mr Bantleman and Mr Chalwell.

12 In the Response it is further asserted that after the meeting Mr Bantleman returned to the office of Centex where he amended by hand the management authority by amending the term to 13 years and amending the management fee to 8% together with the example of a management fee calculation in order to reflect the agreement which had been reached orally earlier that day. It is further asserted that Mr Bantleman prepared forms relating to the new tenancy specifying the financial commitment arising from the lease, which were all prepared on the basis that the management fee was 8% (not 6%) plus GST. The management fee was included in the calculations of the amount to be paid by the tenant, because the management fee was an outgoing for which the tenant was responsible to reimburse the lessor (Mr Chalwell). It was further asserted that when those documents were sent by email to the tenant, a copy was sent to the email address which Mr Chalwell had provided, which was the email address of his daughter-in-law.

13 In the Response it was also asserted that a copy of the management authority which Mr Bantleman had amended, to which 'sign here stickers' were affixed at the point where the amendments were made, was sent to Mr Chalwell by ordinary post on 8 August 2013.

14 In the Response it was further asserted that the copy of the management authority which was sent to Mr Chalwell on 16 August 2013 was sent by a member of the property management team at Centex, under cover of a standard letter and in accordance with standard practice, and was in any event a copy of the document which had been posted to Mr Chalwell on 8 August 2013.

15 In the Response it was further asserted that when Mr Chalwell purported to terminate the management authority on 13 December 2013, Mr Bantleman checked the records maintained by Centex and discovered that the amended management authority had not been initialled or returned by Mr Chalwell, after which Centex and Mr Bantleman accepted that there was no agreement in terms of the amended management authority and therefore acquiesced in the transfer of management of the leased premises to new agents.

16 In the portion of the Response headed 'Contentions' it was asserted that Mr Chalwell agreed to the terms of the amended management authority at the meeting on 6 August 2013, and that at no time did either Mr Bantleman or Centex make any false representations or seek to deceive Mr Chalwell, as was evident from the actions of Mr Bantleman immediately following the meeting. It was further asserted that Mr Chalwell did not suffer any loss or prejudice because Centex did not seek to propound or enforce the amended management authority.

17 Prior to the commencement of the hearing an agreed statement of issues and facts signed by the legal representatives of both parties was filed with the Tribunal. That statement records the factual matters which were agreed, and which correspond to the matters which were not put in issue by the process of exchanging statements of issues, facts and contentions. In addition, after referring to matters that were common ground in respect of the meeting which took place on 6 August 2013, the statement includes the following agreed facts:

Following the meeting referred to in paragraph 12, the second respondent [Mr Bantleman] on behalf of the first respondent [Centex]:

15.1 amended by hand the Management Authority by amending the term to 13 years and amending the management fee to 8%;

15.2 prepared a Tenant Annual Budget and Security Deposit and First Rent Calculator sheet for the Premises on the basis of a management fee of 8% plus GST;

15.3 amended the leasing fee calculator to reflect the discount in the leasing fee of $7,065.53 plus GST (from $18,065.53 plus GST to $11,000 plus GST).

At 8.10 pm on 6 August 2013, the second respondent emailed the New Tenant a copy of the signed offer to lease and the First Bond and Rent Calculator sheet and advised the amount of $54,003.03 was payable as the first rent and bond. The calculation of first rent and bond calculation [sic] included the budget of outgoings for management fees as 8% plus GST. This email was also copied into the email address of Mr Chalwell of nat_chalwell@hotmail.com.
On or about 16 August 2013 the first respondent, by the second respondent sent to Mr Chalwell an amended Exclusive Authority to Act as Managing Agent for Commercial/Industrial Premises (amended Management Authority) under cover of a letter which stated, among other things, 'for your records we attach a copy of "Exclusive Authority to Act as Managing Agent for Commercial/Industrial Premises"'.
The letter referred to in paragraph 15 was a standard letter sent by the first respondent's property management team at the commencement of the lease.
The amended Management Authority was in the same terms as the Management Authority other than as follows:

19.1 the term of the amended Management Authority was stated to be 13 years; and

19.2 the first respondent was stated to be entitled to a management fee of 8% plus GST of gross collections per annum. (original emphasis)

18 Counsel for the Commissioner opened the case consistently with the case enunciated in the Commissioner's statement of issues, facts and contentions - namely, that by sending the amended management authority to Mr Chalwell, Mr Bantleman and Centex represented to him that the terms of the management authority were those set out in the amended document when in fact they were not, or alternatively, sought by deception to obtain Mr Chalwell's agreement to those amendments when there had been no prior discussion of or agreement to the amendments that had been made. Counsel for Mr Bantleman and Centex opened generally in accordance with the position set out in the Response which had been served, but also drew attention to the fact which the Commissioner would concede, to the effect that Mr Chalwell noticed the changes which had been made to the management authority but said nothing to Mr Bantleman about those changes.

19 The evidence of Mr Chalwell took the form of the tender of a signed witness statement, the truth of which Mr Chalwell affirmed, and supplementary oral evidence. The witness statement dealt with the circumstances in which the management authority was executed in December 2011, and the termination of the lease to the original tenant found by Centex. The statement also describes the discussion which took place at Mr Chalwell's home on 6 August 2013 with respect to the tenant Centex had found to replace the outgoing tenant. According to Mr Chalwell's statement he was 'pretty hot under the collar about having to pay another commission to Rick and told him that I thought he should take a financial hit as well as me for having to terminate the last tenant due to non-payment of rent'.[5] According to Mr Chalwell's statement, in that context he offered to pay a leasing fee of $10,000, Mr Bantleman counter-offered at $12,000, and they agreed that the amount would be $11,000 plus GST (a total of $12,100).

20 In his statement Mr Chalwell asserted that on or about 16 August 2013 he received a covering letter attaching a copy of the management authority, which was a very blurred photocopy. Mr Chalwell became 'very concerned' when he found that the term of the agreement had been altered from five years, with termination on 30 days notice after two years, to a term of 13 years, and that the management fee had been increased from 6% to 8%, with corresponding increases in the figures used for the example calculations of management fees contained in the management authority. In his statement Mr Chalwell asserted that he showed the changed document to his wife and both his children and told them that the document had been changed without his agreement or knowledge, and that Mr Bantleman had shot himself in the foot, and that he would terminate the management authority by giving 30 days notice when the two year term had expired. According to Mr Chalwell's statement, although he was concerned about receiving the document showing changes to which he had not agreed, he was also happy to have received it because it gave him a further reason to terminate the management authority in addition to the issues with respect to complaints about Mr Bantleman that had been received from the previous tenant. In his statement Mr Chalwell asserted:[6]

I chose not to raise the issue with Rick at the time of receiving this document as I had no interest in arguing with him and I intended to use the document as one of the reasons for terminating Rick's MAA at the 2 year period, when I would have the right to terminate Rick's MAA by giving him 30 days notice.

21 Mr Chalwell's statement also deals with the circumstances in which he terminated the management authority, initially endeavouring to terminate the authority immediately, then with effect from 11 January 2014, and the correspondence which ensued, which resulted in the authority terminating with effect from 24 January 2014. Although Mr Chalwell was uncertain as to where that date came from, there is a clear inference that the date was selected by Mr Bantleman because it was two years and 30 days after the commencement of the management authority.

22 In his oral evidence-in-chief Mr Chalwell stated that Mr Bantleman initially proposed that the management authority be for a term of five years with two option periods of five years each, which was equal to the term of the initial lease and that Mr Chalwell insisted that he would not commit to anything more than a two year term, after which he would review it.[7] He also stated that he only received one copy of the amended management authority, under cover of a letter dated 16 August 2013, and did not receive any copy of the amended management authority prior to that, under cover of a 'with compliments' slip.[8]

23 In cross-examination Mr Chalwell was shown an extract from a document described as the mail register maintained by Centex which recorded that on 8 August 2013 he had been sent documents by post described by the letters 'PMS' (an acronym for property management statement), and an authority. Mr Chalwell denied receiving those documents. When it was put to him, Mr Chalwell specifically denied having received a version of the management authority to which were affixed 'sign here' stickers next to the changes made to the term of the agreement and the percentage fee chargeable.[9] When the amended management authority sent under cover of the letter from Centex dated 16 August 2013 was put to Mr Chalwell, he agreed that the amendment to the term of the agreement to 13 years was one of the clearest things on the relevant page and 'just jumps out at you as soon as you look at the page'.[10] When the change to the management fee chargeable under the agreement was put to Mr Chalwell, he asserted, inconsistently with his written statement, that he did not notice the change to the management fee - only the change to the term of the agreement.[11]

24 It was then put to Mr Chalwell that when he noticed the change to the term of the management authority he could have picked up his phone to Mr Bantleman and raised it with him. In that context Mr Chalwell agreed with the cross-examiner that he was the sort of person who was inclined to speak his mind, that the property which he owned that was being managed by Centex was a valuable property, that he had experience in business, and that he had negotiated the terms of his agreement with Mr Bantleman.[12] He also accepted that he was the sort of person who, in the relationship he had with Mr Bantleman, would tell him if there was a problem.[13]

25 In that context Mr Chalwell was asked what he did when he noticed that the term of the agreement had been altered. He responded:[14]

Well, I - well, actually I was quite elated about it because I knew I had him. This was another - I had my - my intentions to terminate his management at the end of 2 years. This just reinforced what I was going to do at the end of 2 years.

26 When it was put to Mr Chalwell that he saw this as an opportunity to get his own way he responded 'no, I had my own way anyway with a 2 year agreement'.[15]

27 In cross-examination Mr Chalwell initially maintained the position he had adopted during evidence-in-chief to the effect that the original lease was for a five year term with two five year options.[16] However, when the original lease was presented to him he agreed that the first lease was for a period of five years with two three year options.

28 In cross-examination Mr Chalwell agreed that the terms of the second lease to the tenant procured by Centex were more favourable than the first. He accepted that the annual rent increased from $79,500 plus outgoings to $139,500 including outgoings, the term increased from five years with two three year options to a five year term with two five year options, two personal guarantors guaranteed the lessee's performance under the lease whereas under the first lease there were no personal guarantees, the bond had increased from $7,000 to $38,000, and the rent was reviewed in 2016 under the second lease, rather than in 2017 under the first lease.[17]

29 In cross-examination Mr Chalwell was adamant that there had been no discussion with respect to the amount of the management fee or the term of the management authority during the meeting on 6 August 2013.[18] Mr Chalwell could not recall seeing the email which Mr Bantleman sent to the incoming tenant on the evening of 6 August 2013 and which had been copied to Mr Chalwell's daughter.[19] He stated that it was his daughter's usual practice to print out any emails she received on his behalf and provide them to him, but he could not recall seeing this email.[20] Mr Chalwell was shown a document entitled 'Tenant Annual Budget' prepared by Mr Bantleman on the evening of 6 August 2013 which referred to the management fees payable amongst the outgoings as being calculated at 8.8% (8% plus GST). However, Mr Chalwell maintained his denial that there had been any discussion with respect to increasing the commission payable earlier that day.[21]

30 Mr Chalwell accepted that he signed a new leasing authority presented to him by Mr Bantleman during the meeting on 6 August 2013. That document bears a manuscript addition recording that the leasing fee payable in respect of the new lease would be $11,000 plus GST.

31 In cross-examination Mr Chalwell accepted that when he received the management authority that was amended to show a term of 13 years there were two possibilities - either Mr Bantleman mistakenly thought he had agreed to the increase in term or he was proposing an amendment to the term[22] or, in other words, Mr Bantleman was either saying 'we've already agreed' to 13 years, or 'I want you to agree to 13 years'.[23] Mr Chalwell accepted that his position was that he had not already agreed and he was not going to agree now.[24] In that context he reiterated that he did nothing in response to receipt of the amended management authority.[25] According to Mr Chalwell:[26]

I was going to completely ignore it, give it back to them. I wasn't going to have anything to do with it because I knew that his 2 years - his 2 years were going to be up at the end of the year, and I - I didn't want to know anything about it after that.

32 Mr Chalwell also accepted that the amendments to the management authority would only be effective if he initialled and returned them, and he chose not to initial and return them.[27] Mr Chalwell also accepted that although Mr Bantleman initially sought to rely upon the amended management authority when he purported to terminate it, Mr Bantleman acknowledged that as the amendments to the agreement had not been initialled by Mr Chalwell, he was unable to rely upon them and accepted the termination of the agreement.[28]

33 Mr Bantleman's evidence-in-chief was given entirely in the form of a signed witness statement, the truth of which he affirmed and which was tendered. In that statement he asserted that in his initial discussions with Mr Chalwell relating to management of the property in Radium Street, he told him that the usual management fee charged by Centex was 8%, but that because he was a new client he would agree to charge him a lower fee of 6% for an initial period of two years on the basis that after the initial two year period a new management authority with a term of not less than five years and a management fee of 8% plus GST would be entered into. Although he could not recall Mr Chalwell's exact response, according to Mr Bantleman's witness statement, Mr Chalwell accepted those terms.

34 Following the eviction of the first tenant, Mr Bantleman identified a replacement tenant and prepared a leasing authority for Mr Chalwell to sign, out of an abundance of caution and good practice, given that the management authority already authorised Centex to lease the premises.[29] He had also prepared an offer to lease which was executed by the new tenant. He went to Mr Chalwell's home on the afternoon of 6 August 2013 and presented the leasing authority to him.

35 According to Mr Bantleman's statement, Mr Chalwell stated that he wanted a discounted leasing fee as a result of the problems arising from the first tenant's termination of the lease. According to Mr Bantleman, he responded to the effect that he would only be prepared to discount the leasing fee if Mr Chalwell agreed to extend the management term to 13 years and increase the management fee to the usual fee charged by Centex - namely, 8% plus GST. According to Mr Bantleman, Mr Chalwell agreed to this proposal. He then amended the leasing authority to reflect the discounted leasing fee, which had been agreed at $11,000 plus GST.

36 Mr Bantleman then returned to the Centex office where he amended the management authority in accordance with the terms he stated had been earlier discussed. The amended management authority was scanned onto the Centex computer system at 9.08 pm on 6 August 2013, and a document from the records of Centex to that effect was produced and tendered in evidence.

37 That evening Mr Bantleman also prepared a tenant annual budget and a security deposit and first bond and rent calculator sheet, the latter to be provided to the incoming tenant. The calculations in these documents were undertaken on the basis that the management fee was 8% (not 6%) plus GST. Those documents were also tendered in evidence. Mr Bantleman also amended the leasing fee calculator to reflect the discount in the leasing fee which had been earlier agreed.

38 At 8.10 pm on 6 August 2013 Mr Bantleman emailed a copy of the signed offer to lease and the first bond and rent calculator sheet to the new tenant, and sent a copy to the email address he had been given by Mr Chalwell - which he believed was the email address of Mr Chalwell's daughter-in-law. The bond and rent calculator sheet contained figures which had been calculated using the management fee of 8% plus GST, but did not expressly identify the rate used in the calculations.

39 According to Mr Bantleman's statement, he also placed 'sign here' stickers on the amendments he had made on a copy of the amended management authority, and placed the document in a tray from which it would be posted by the administration staff of an accounting firm with whom Centex shared offices, and who were responsible for the postage of mail from Centex. Mr Bantleman was not personally aware of when or how the document was posted, but from looking at the mail register maintained by Centex, a copy of which was tendered in evidence, he believed that the amended authority bearing the 'sign here' stickers was sent to Mr Chalwell on 8 August 2013 by ordinary post. Mr Bantleman did not recall preparing a covering letter to be sent with the amended management authority and could not find any such letter in the electronic records maintained by Centex. His evidence was that if there was no covering letter it was his usual practice to add a 'with compliments slip' bearing a brief handwritten note explaining the document. He had no reason to believe that he would not have followed his ordinary practice in this instance. The purpose of attaching the 'sign here' stickers was to draw Mr Chalwell's attention to the agreed changes and obtain his confirmation in writing of the agreement which had been made orally on 6 August 2013, according to Mr Bantleman's statement.

40 Consistently with the agreed facts, Mr Bantleman asserted in his statement that he believed that the property management team at Centex sent a copy of the standard letter with attachments, and which was sent at the commencement of each new lease to Mr Chalwell.

41 On 13 December 2013 Mr Bantleman received an email from Mr Chalwell advising that he had decided to transfer management of the premises effective immediately. He responded advising Mr Chalwell that he could terminate the agreement but only if he paid to Centex its management fees for the remainder of the term. Mr Chalwell replied to the effect that he was terminating the management authority with effect from 11 January 2014, attaching a copy of the original management authority. Mr Bantleman then checked the authority section of his electronic files and, according to his written statement, was surprised to discover that the amended management authority had not in fact been initialled or returned by Mr Chalwell. Upon discovering that fact, Mr Bantleman decided not to take any action to attempt to enforce the oral agreement made on 6 August 2013 and liaised with the new managing agents for an orderly transfer of management of the premises with effect from 23 January 2014.

42 In cross-examination Mr Bantleman was asked about his discussions with Mr Chalwell prior to entering into the original management authority. It was not put to Mr Bantleman that the evidence in his witness statement with respect to those discussions was incorrect or false.[30]

43 In cross-examination Mr Bantleman maintained his position that at the meeting of 6 August 2013, Mr Chalwell agreed to the extension of the term of the management authority and the increase in the management fee in return for Mr Bantleman agreeing to reducing the leasing fee to $11,000 plus GST.[31] He made no note of the changes on the leasing authority, because those matters were not addressed by the leasing authority document, but were contained in the management authority document, which he did not have with him at the meeting with Mr Chalwell.[32] However, after the meeting he went back to his office and that evening amended the relevant management authority document, arranged for a copy to go to Mr Chalwell by mail, and prepared all other relevant documents on the basis of his understanding that the management fee had been increased to 8%.[33] Mr Bantleman denied the proposition put by counsel for the Commissioner that when he got back to his office that night he decided he would unilaterally amend the management authority.[34]

44 In cross-examination Mr Bantleman rejected the proposition that there had been no discussion with respect to the terms of the management authority at the meeting with Mr Chalwell on 6 August 2013.

45 When asked about the manner in which he amended the management authority, Mr Bantleman denied that the ordinary procedure for amending a contract was to strike through the original text, rather than white it out.[35] Mr Bantleman reiterated his evidence to the effect that he produced a hard copy of the amended management authority that night, affixed 'sign here' stickers at the point where the changes had been made, and placed it in the tray for posting to Mr Chalwell.[36] Although Mr Bantleman could not recall if he attached a 'with compliments' slip to the amended management authority, he believes that he would have done so, written Mr Chalwell's name and address on the slip, and written words to the effect of:[37]

In accordance with our agreement, please sign at the stickers and return to me asap.

Mr Bantleman denied that it would have been prudent to take a copy of the 'with compliments' slip, relying upon his experience working in the industry, in which he asserted it was not normal practice to take photocopies of 'with compliment' slips.

46 In cross-examination Mr Bantleman gave evidence to the effect that after the meeting on 6 August 2013, he made entries in the systems of Centex which would result in the tenant being charged outgoings by reference to a management fee of 8% but Mr Chalwell was only charged 6%, until such time as he returned the signed amended management authority.[38] In cross-examination Mr Bantleman asserted that there was no point at which Mr Chalwell was charged a management fee of 8%, although in re-examination he accepted that there was a period in which Mr Chalwell was charged 8%, as a result of steps taken by Mr Milan Shah without reference to Mr Bantleman.

47 In cross-examination Mr Bantleman also stated that the letter of 16 August 2013 to Mr Chalwell, including the copy of the amended management authority, was automatically generated in accordance with standard practice, by the push of one button and the signature on the letter was computerised, rather than manuscript.

48 During cross-examination an issue arose as to whether it was the Commissioner's case that the letter said to have been sent on or around 8 August was never sent. At that point counsel for the Commissioner confirmed that it was not his case that the letter was never sent - rather, that it was accepted that it was sent, but without 'sign here' stickers on it.[39]

49 In re-examination Mr Bantleman stated that he was not aware that the amended management authority had not been signed and returned until he checked with his property manager, Mr Shah, in December 2013.

50 Mr Bantleman also asserted in re-examination that he expected that if Mr Chalwell had any difficulty with the amended terms of the management authority he would communicate those difficulties to him, based on his experience of his past dealings.[40] He also stated that when signed agreements were returned to the office it was not something he would usually deal with personally, but such documents would be dealt with instead by Mr Shah, the property manager. Mr Shah's practice was to put unsigned documents in a temporary file, and only place a document on the permanent file after it had been signed and returned.[41] Mr Bantleman also stated in re-examination that he was not aware of any difficulties with the mailing system used by Centex and considered the people providing the mail service to be very responsible.[42]

51 In re-examination Mr Bantleman stated that Mr Chalwell was happy at the meeting on 6 August 2013, because of the more favourable terms of the new lease. Mr Bantleman also stated that he would not have foregone $7,000 of his leasing fee without negotiating something in return.[43]

52 In questions posed by the Tribunal, Mr Bantleman confirmed that the letter of 16 August 2013 was a standard letter sent out by the property manager, not him, with an electronic signature and attaching standard documents drawn from the system.[44] He also confirmed that it was the property manager who took responsibility for ensuring that agreements sent out for signature were returned.[45]

53 The only other witness to give oral evidence at the hearing was Mr Milan Shah.[46] Mr Shah's evidence-in-chief was given by the tender of a witness statement in which he asserted that his usual practice was to place a copy of any unsigned property management authority in the in-tray, where it would be left until the original authority was returned to the office signed, when it would be filed. If the authority was not signed and returned, he would advise Mr Bantleman, who would then follow up the matter with the client.

54 However, after reviewing the records relating to Mr Chalwell's property, Mr Shah believes that in this instance he inadvertently filed the amended management authority before it was signed and returned - inferentially with the consequence that the fact that it was not signed and returned escaped attention.

55 In his statement Mr Shah also asserted that he routinely audited the property management files every couple of months. When he was conducting one of those audits he changed the property management fee rate charged in the computer system in respect of the Radium Street property from 6% to 8% as he had assumed that the amended management authority had been signed and returned because it had been filed.

56 In cross-examination Mr Shah confirmed that in this case he found a copy of the amended management authority in his in-tray, after which he inadvertently filed it away for a reason he could not explain. He also confirmed that the letter of 16 August 2013 was a standard form letter sent out to clients when a new lease was entered into, attaching a copy of the management authority held in the records of Centex.[47] Mr Shah accepted that it followed that the amended management authority must have been filed before that letter was sent on 16 August 2013.

57 The parties provided written closing submissions. As we have noted, in the Commissioner's closing submissions, he withdrew his alternative case, to the effect that the conduct of Mr Bantleman and Centex was unfair and dishonest because they sought, by deception, to procure Mr Chalwell's agreement to the amended management authority.[48]

58 The Commissioner submitted that Mr Chalwell's evidence should be accepted for the various reasons set out in the submissions. In that context it was submitted that the central issue was whether or not Mr Bantleman and Mr Chalwell had agreed to amend the management authority on 6 August 2013.[49] It was submitted that whether or not Mr Chalwell received both the amended management authority posted on 8 August 2013, and the further copy of that agreement posted on 16 August 2013, each contained an implicit representation to the effect that agreement had been reached in the amended terms - a representation which was false. That conduct was submitted to be dishonest or unfair because 'ordinary decent people' would consider it to be so.[50]

59 The written submissions filed on behalf of Mr Bantleman and Centex emphasised that in order to establish unfairness or dishonesty it would be necessary for the Commissioner to establish that Mr Bantleman did not in fact believe that the agreement had been amended in the manner in which he asserted. It was submitted that the fact that he and Mr Chalwell may have recalled their meeting differently would not be enough to establish the Commissioner's case.[51]

60 In the written submissions filed on behalf of Mr Bantleman and Centex, particular attention was drawn to the actions which Mr Bantleman took after returning to the Centex office following his meeting with Mr Chalwell, including preparing a number of documents on the basis that the management fee was 8% plus GST, emailing some of those documents to the incoming tenant and the email address given by Mr Chalwell, and causing a copy of the amended management authority with, according to Mr Bantleman, 'sign here' stickers affixed at the place where the amendments had been made, to be posted to Mr Chalwell. The submissions contended that even if the amendments were not agreed to by Mr Chalwell, the fact that Mr Bantleman believed that amendments had been made to the management agreement was supported by his actions on 6 August 2013.[52] As will be seen, this important submission was never dealt with by the Tribunal.

61 Attention was also drawn to the fact that although the new tenant was charged on the basis that the management fee was 8% plus GST, Mr Chalwell was initially only charged 6% plus GST until Mr Shah erroneously assumed that the amended management authority had been signed and returned, and unilaterally increased the rate to 8% plus GST. This fact was submitted to make it clear that Mr Bantleman did not intend to charge the increased rate until the amended management authority had been signed by Mr Chalwell and returned - a fact which was said to be entirely inconsistent with any dishonest or unfair intention.

62 In the written submissions attention was also drawn to the Commissioner's concession that a document in the form of the amended management authority was sent by post to Mr Chalwell on 8 August 2013, which was also said to be inconsistent with any intention to act unfairly or dishonestly.

63 The Tribunal, which comprised the President and two members, gave joint reasons. Following prefatory references to relevant legislation and an authority dealing with the meaning of 'fairly and honestly',[53] the Tribunal described the Commissioner's case in these terms:[54]

The Commissioner alleges that Rick Anthony Bantleman and Centex Australasia Pty Ltd acted unfairly and dishonestly, contrary to s 7(1) of the Code, in that Mr Bantleman, on behalf of Centex, sent Edward Francis Chalwell an exclusive authority to act as managing agent which purported to, but which did not reflect the agreement reached between Mr Bantleman and Mr Chalwell on 6 August 2013.

64 It will be noted that this is not a completely accurate description of the Commissioner's case, which was to the effect that there was no agreement reached between Mr Bantleman and Mr Chalwell with respect to the continuing management authority on 6 August 2013 and, which, in the end, was confined to a case of misrepresentation as to the terms of that agreement. Although a misdescription of that kind would not ordinarily be worthy of note, the grounds of appeal include assertions that the Tribunal failed to properly identify and address the Commissioner's case.

65 Under the heading 'Assessment of witnesses' the Tribunal observed:[55]

The Tribunal found Mr Chalwell to be an honest and direct witness who answered questions to the best of his ability, even when the answer was against his interests. The Tribunal found Mr Bantleman to be a witness who answered questions in a manner calculated to advance his and Centex's interests. Where the evidence of Mr Chalwell and Mr Bantleman conflicts, we prefer the evidence of Mr Chalwell.

66 We digress to observe that this is a statement of a conclusion, not the elucidation of a process of reasoning. At no point in its reasons does the Tribunal identify questions which Mr Chalwell answered which were contrary to his interests, nor do the reasons identify any questions which Mr Bantleman answered in a manner calculated to advance his and Centex's interests. Nor are those questions and answers at all evident from a detailed consideration of the transcript of the evidence given by those witnesses.

67 The Tribunal's unreasoned conclusion on the credibility of the witnesses must be read in a context in which Mr Chalwell:

(a) denied receiving an email which was sent to the address he had given;

(b) denied receiving documents which the Commissioner accepted were posted to him;[56]

(d) gave oral evidence which was directly contrary to the witness statement he had affirmed to be true in a significant respect - namely as to whether he noticed the change in management fees when he received the amended management authority;

(e) provided reasons for not reacting to the amendment to the term of the management authority that he noticed, which have an inherent air of implausibility, for reasons which will be developed below.

68 By contrast, the actions taken by Mr Bantleman following the meeting on 6 August and which are not disputed, including preparing all documents relating to the new tenancy on the basis of the revised terms of the agreement, emailing documents so prepared to the tenant with a copy to Mr Chalwell, posting a copy of the amended management authority to Mr Chalwell, and providing a copy of the amended agreement to Mr Shah are all consistent with the evidence which he gave.

69 Having regard to the matters which were not in contention, the Tribunal's statutory obligation to provide reasons which include its findings on material questions of fact, referring to the evidence or other material on which those findings are based,[57] required more than the expression of a conclusion that the evidence of one witness was to be preferred in every instance in which it conflicted with the evidence of another.[58]

70 After reciting various non-contentious facts, the Tribunal referred to the evidence given by Mr Bantleman to the effect that prior to entry into the management authority in December, it was understood that after the initial two year period a new authority providing for management fees of 8% and for a term of not less than five years would be entered into. In that context the Tribunal held:[59]

If the understanding was as alleged by Centex, it is difficult to explain why it was not reflected in the terms of the Management Authority. There would be no difficulty in incorporating such terms in the Management Authority.

The Tribunal does not accept that there was an understanding as alleged by Mr Bantleman.

71 These findings are not specifically challenged by any ground of appeal - presumably because they are not material to the Tribunal's ultimate conclusion. However, as we have already noted, counsel for the Commissioner never put to Mr Bantleman that there was no discussion in the terms he asserted, nor was it ever put to Mr Bantleman that the terms of the understanding could be easily incorporated in the management authority,[60] with the result that Mr Bantleman had no opportunity to respond to the proposition which found favour with the Tribunal.

72 After referring to the original terms of the management authority, and the termination of the first lease, the Tribunal turned to the meeting of 6 August 2013, setting out the respective positions adopted by the parties with respect to the events which took place at that meeting. The Tribunal stated that the critical issue for it to determine is whether the management authority was discussed at the meeting of 6 August 2013.[61] After expressing the view that the amendments to the management authority were significant, the Tribunal observed:[62]

Mr Chalwell gave evidence that he originally sought a term of two years in the Management Authority because he did not know Mr Bantleman. Mr Chalwell's evidence was that he felt that having paid the leasing commission on five years for the First Lease when it was terminated after 14 or 16 months, Mr Bantleman was not entitled to receive a completely new commission on a new lease (T: 23). At the time the second offer to lease was brought to Mr Chalwell by Mr Bantleman, Mr Chalwell was unhappy with Mr Bantleman's services in relation to the First Lease (T: 9 - 10). It is inherently unlikely in these circumstances that Mr Chalwell would agree to a term of 13 years for the Management Authority, given that he was unhappy with Mr Bantleman's services under the Management Authority to 6 August 2013.

73 We digress to observe that it seems this process of reasoning depends upon the earlier conclusion that Mr Chalwell's evidence should be accepted in its entirety, and Mr Bantleman's evidence rejected whenever it conflicted with Mr Chalwell's evidence. That is because the reasoning process elucidated in this paragraph appears to take no account of Mr Bantleman's evidence that:

(a) he did not consider that Mr Chalwell was 'hot under the collar' at the time of the meeting on 6 August 2013;

(b) Mr Chalwell was very happy with the terms of the new lease which were much more favourable than the previous lease, providing a significantly increased rental, more regular reviews of rental, an increased bond and personal guarantees - all objective facts which would, on their face, provide every reason for Mr Chalwell to be happy with Mr Bantleman's services and willing to agree to amendments to the management authority, in a context in which any increase in management fees was paid by the tenant as outgoings; and

(c) he would not have foregone a substantial portion of the leasing fee to which he was entitled for finding a new tenant unless he received a quid pro quo in the form of an extension to the term of the management authority (which could terminate within five months of the meeting on 6 August 2013).

Mr Bantleman accepted that he did not make a written note of the agreement to amend the terms of the Management Authority. His explanation was that it was because the Leasing Authority was not the right document to note such an amendment (T: 58).

Mr Bantleman explained why the Leasing Authority was not amended. However, it provides no answer as to why a note could not have been made in another document or in a new document at the 6 August 2013 meeting.

Given the nature of the amendments, there is no reason why a note could not have been made of the meeting. The failure to do so weighs against an agreement having been made, as alleged by Mr Bantleman, between him and Mr Chalwell.

75 As with the preceding portion of the Tribunal's reasons, it seems this process of reasoning was also predicated upon the Tribunal's general rejection of Mr Bantleman's evidence, because it takes no account of his evidence to the effect that, rightly or wrongly, he considered that the most appropriate document in which to record any changes to the management authority was the management authority itself.[64] This is a plausible proposition which is entirely consistent with the fact that Mr Bantleman amended the management authority later that day and caused it to be posted to Mr Chalwell - a fact which the Commissioner accepted. Further, it was never put to Mr Bantleman in cross-examination that he should have prepared a note of the agreement to amend the management authority during the meeting with the result that he was denied the opportunity to respond to that proposition.

76 The Tribunal's finding as to the matters discussed at the meeting was expressed in the following terms:[65]

The Tribunal accepts Mr Chalwell's evidence that there was no discussion of the terms of the Management Authority.

The Tribunal does not accept that there was any scope for Mr Bantleman to misunderstand the terms that had been amended. This is because there simply was no discussion. It follows that Mr Bantleman knew that there had been no discussion of the terms of the Management Authority and no agreement to amend the terms. Mr Bantleman did not allege in his SIFC that the terms of the Management Authority had been amended.

77 It is difficult to reconcile the last sentence above with the Response to the SIFC served on behalf of Mr Bantleman and Centex to the effect that Mr Chalwell and Mr Bantleman orally agreed that the management authority would be amended to provide for a term of 13 years and a management fee of 8% plus GST.

The steps taken by Mr Bantleman following the meeting

78 The Tribunal then records the various steps taken by Mr Bantleman after his meeting with Mr Chalwell on 6 August 2013. In that context the Tribunal observes:[66]

The Tribunal notes that Mr Bantleman prepared a new Leasing Authority although he was not required to do so. It is odd therefore that he did not prepare a new Management Authority rather than amending the existing Management Authority. Had he done so, it is likely that the amendments would have been more obvious.

79 We digress to observe that there are two evident difficulties with this process of reasoning. First, it was never put to Mr Bantleman that he should have prepared a new management authority rather than amend the existing authority. Second, the Commissioner's case had been confined to a case based on misrepresentation to Mr Chalwell with respect to the terms of the amended authority. Of course such a representation could only be made out if the terms of the amended authority were communicated to Mr Chalwell. In that context, reference to a course of action which should have been taken in order to make the amendments more obvious appears contrary to the case which the Commissioner ultimately presented to the Tribunal, and appears only consistent with an assumption that the alternative deception case, which the Commissioner had abandoned, remained on foot.

80 The latter observation can also be made with respect to the portion of the Tribunal's reasons which follow the reference to Mr Bantleman's amendment of the management authority using liquid paper:[67]

It strikes the Tribunal as out of the ordinary, if not extraordinary, that Mr Bantleman whited out the figures rather than preparing a new Management Authority or initialling the amendments himself and seeking to have Mr Chalwell initial them.

Mr Bantleman gave evidence that he was not aware that the ordinary manner in which a contract is amended is for the original text to be struck through and initialled (T: 64). The Tribunal does not accept Mr Bantleman's evidence.

The use of white liquid paper was not calculated to draw Mr Chalwell's attention to the amendments. Although in fact, Mr Chalwell did notice the change to the term he did not notice the change to the percentage rate (T: 18).

81 In the context of its consideration of the documents prepared by Mr Bantleman followings his meeting with Mr Chalwell on the evening of 6 August 2013, the Tribunal observed:[68]

Mr Bantleman prepared the amended Management Authority on 6 August 2013 (T: 69). Mr Bantleman advanced no reason as to why he did not, or could not have included, at least the amended page of the Management Authority in his email of 6 August 2013. Mr Bantleman's failure to attach the amended Management Authority to the email of 6 August 2013, when it had been prepared on that date, or to send it later on 6 August 2013, if it was prepared after 8:10 pm, tells against any agreement to amend the Management Authority as alleged by Mr Bantleman as having been reached. It is the first document listed in SOAF 15.

82 There are a number of evident difficulties with this process of reasoning. First, it seems likely that the explanation for Mr Bantleman's failure to advance a reason as to why he did not include at least the amended page of the management authority in his email is the fact that it was never suggested or put to him that he should have done so. Second, the proposition that the amended page of the management authority should have been included in the email is far from self-evident, given that the email was to the incoming tenant, who was not a party to the management authority, in a context in which Mr Chalwell may well have not wanted the tenant to know all the terms of his agreement with the managing agent. Third, the process of reasoning enunciated appears to ignore the agreed fact that on the evening of 6 August 2013, at about the same time the email was sent, Mr Bantleman produced a copy of the amended management authority and caused it to be posted to Mr Chalwell.

83 After referring to the cross-examination of Mr Chalwell with respect to the document headed 'Tenant Annual Budget and Actuals', and the fact that the management fee of 8% was only readily discernible on a colour copy of that document, which was a document internal to Centex and not sent as an attachment to the email to the incoming tenant, the Tribunal observed:[69]

It is difficult to understand why Mr Bantleman did not send the Tenant Annual Budget and Actuals with a request that it be printed in colour which would have expressly shown the increase in the percentage.

84 There are a number of difficulties evident in this process of reasoning. First, it was never suggested or put to Mr Bantleman that he should have attached the document to the email with a request that it be printed in colour. Mr Bantleman was thereby deprived of the opportunity of responding to a proposition which the Tribunal has used to make a finding adverse to him. Second, the email sent on 6 August 2013 was to the incoming tenant and attached the document entitled 'Security Deposit and First Rent Calculator', which contained all the calculations that the tenant needed to understand the payment due to be made. The document which the Tribunal apparently concluded should have been sent was, as its title connotes, an annual budget prepared apparently for the internal purposes of Centex and is not, on its face, a document of a kind one would expect to be sent to the incoming tenant. Third, the Tribunal's reasoning ignores the agreed fact that, at the same time as he caused the email to be sent, Mr Bantleman prepared a copy of the amended management authority which he caused to be posted to Mr Chalwell. Fourth, the process of reasoning enunciated in this portion of the Tribunal's reasons has no apparent relevance to the Commissioner's misrepresentation case, but appears only relevant to the Commissioner's alternative deception case, which had been abandoned.

85 The latter observation applies with equal force to the next two paragraphs of the Tribunal's reasons:[70]

The Tribunal notes that to perhaps the last month or two of 2013, Centex charged a management fee of 6% (T: 82). If Mr Chalwell had checked the amount of commission that was charged by reference to the monthly statements received by him from Centex, it would have shown that a commission of 6% was being charged, not 8%.

It would have been simple to include an express statement that the percentage of the management fee had increased and that the term had been extended. Yet, Mr Bantleman did nothing to expressly draw the alleged amended terms to Mr Chalwell's attention.

86 At the risk of repetition, the Commissioner's case was that Mr Bantleman, and through him Centex, had acted unfairly and dishonestly by falsely representing to Mr Chalwell that they had agreed on 6 August 2013 the management authority had a term of 13 years and provided for a fee of 8%. However, these portions of the Tribunal's reasons are only consistent with a perception on the part of the Tribunal to the effect that the Commissioner's case was based upon an attempt by Mr Bantleman to deceive Mr Chalwell as to the terms of the agreement - a case which the Commissioner expressly abandoned. Further, at no point in the Tribunal's reasons is any consideration given to the submission advanced on behalf of Mr Bantleman and Centex to the effect that continuing to charge Mr Chalwell management fees at the old rate until the amended management authority was signed and returned is inconsistent with any unfairness or dishonesty on the part of Mr Bantleman and Centex.

The first copy of the amended management authority posted to Mr Chalwell

87 Because of the grounds of appeal it is necessary to set out in full the Tribunal's reasons relating to the admitted fact that Mr Bantleman caused a copy of the amended management authority to be posted to Mr Chalwell on 8 August 2013, having placed the document in a tray for postage on the evening of 6 August 2013:[71]

There is evidence that the amended Management Authority was posted on 8 August 2013, but that is only evidence of its dispatch, not of its receipt (Exhibit B page 39). Mr Chalwell denies that he received the amended Management Authority (T: 11; T: 16).

Centex's and Mr Bantleman's case, as stated by their counsel in the course of her opening, was that Mr Bantleman had:

'... whited out the change [to the Management Authority] and then sent it to Mr Chalwell to initial it. That was the purpose for which it was sent to Mr Chalwell and that so he made the change, annexed the Sign Here sticker next to each of those two changes, and then waited, in fact, to receive back the initialled copy of the document from Mr Chalwell.'

(T: 5).

Mr Bantleman did not check to see if the amended Management Authority was returned (T: 80). Mr Bantleman's evidence was that it was only when Mr Chalwell terminated the Management Authority that he became aware that an amended Management Authority had not been returned (T: 89).

Given that the purpose of sending the amended Management Authority to Mr Chalwell was allegedly to have him initial it and return it to reflect the alleged agreement of 6 August 2013, the failure by Mr Bantleman to check that it was returned tells against the existence of the alleged agreement.

The Tribunal does not accept that Mr Bantleman placed 'sign here' stickers on the amended Management Authority of 8 August 2013.

88 There are a number of evident difficulties in this portion of the Tribunal's reasons. First, the inference drawn by the Tribunal makes no reference to and appears to take no account of the evidence given by each of Mr Bantleman, and Mr Shah, and which was not challenged in cross-examination of either, to the effect that it was Mr Shah's responsibility to monitor the return of agreements sent out for execution, not Mr Bantleman's. Second, the fact of most relevance to the question of whether amendments to the management authority were discussed on 6 August 2013 was the fact that a copy of an amended agreement was prepared by Mr Bantleman that evening, who caused it to be posted to Mr Chalwell forthwith. That fact, which was not in dispute, was of much greater relevance to the issue of what was discussed between Mr Chalwell and Mr Bantleman than the question of whether Mr Bantleman monitored the return of the amended agreement initialled by Mr Chalwell. It is not easy to reconcile Mr Bantleman's conduct in preparing and sending to Mr Chalwell an amended management authority with the state of mind alleged by the Commissioner: that Mr Bantleman knew there had been no discussion of the management authority. However, the Tribunal's reasons contain no reference to its consideration of the significance of Mr Bantleman causing the amended management authority to be posted to Mr Chalwell immediately after their discussion, in the evaluation of the evidence relating to the discussions which took place earlier that day.

89 Third, the only live issue in relation to the posting of the amended management authority was whether Mr Bantleman placed 'sign here' stickers on the document which was posted to Mr Chalwell. However, no portion of the Tribunal's reasons have any logical or rational connection to the enunciated conclusion that the stickers were not placed on the document (as counsel for the Commissioner conceded, properly, during the hearing before us). Further, that conclusion cannot be sustained by reference to the Tribunal's general preference for Mr Chalwell's evidence, where it conflicted with Mr Bantleman's evidence, because Mr Chalwell's evidence did not bear upon the issue. His evidence was not to the effect that he received the first copy of the amended management authority sent to him without 'sign here' stickers - rather, his evidence was to the effect that he did not receive the document at all. So, the Tribunal's finding to the effect that the 'sign here' stickers were not placed on the document which Mr Bantleman caused to be posted does not appear to comply with the obligations imposed upon the Tribunal to provide, in its reasons, a reference to the evidence or other materials upon which that finding was based.[72] We digress to observe that this is a finding which is of great significance to the question of whether it was open to find that Mr Bantleman (and Centex) had acted unfairly or dishonestly.

90 The Tribunal's reasons then deal with the letter of 16 August 2013, to which a second copy of the amended management authority was attached. In that context the Tribunal observed:[73]

On Mr Bantleman's evidence, a second copy of the amended Management Authority was sent. No real reason was advanced as to why a second copy was sent.

The letter of 16 August 2013 was a standard letter sent by Centex's property management team at the commencement of a lease (SOAF 18).

91 The first sentence above appears to be directly contradicted by the second sentence above, given the evidence that the letter of 16 August 2013 was automatically generated by the push of a button and attached documents drawn from the electronic records of Centex.

Mr Chalwell's failure to react to the amended management authority

92 Because of the grounds of appeal it is necessary to set out the Tribunal's reasoning in relation to Mr Chalwell's response to the letter of 16 August 2013 in full. After referring to Mr Chalwell's evidence to the effect that he noticed the change to the term but not the change to the management fee in the amended management authority sent under cover of the letter of 16 August 2013,[74] the Tribunal observed:[75]

Despite the fact that the amended Management Authority did not reflect any agreement between he and Mr Bantleman, Mr Chalwell did nothing about it. Mr Bantleman and Centex argued that this was because the amended Management Authority reflected the agreement made between Mr Bantleman and Mr Chalwell.

Mr Chalwell had already decided on 6 August 2013, when Mr Bantleman came to his home for the meeting, that he was not going to continue with it beyond two years (T: 50).

Mr Chalwell's explanation for not doing anything about it at that time was because the period of two years referred to in the Management Authority expired on 24 December 2013. He would then be entitled to terminate the Management Authority on 30 days' notice. The amendments made by Mr Bantleman without Mr Chalwell's agreement, therefore gave Mr Chalwell a further reason to terminate the Management Authority at the expiry of the two years (T: 22). The amended Management Agreement gave him 'more ammunition' (T: 50).

The Tribunal accepts Mr Chalwell's explanation. Accordingly, it does not draw any adverse inference against Mr Chalwell from his failure to do anything about the fact that the amendments did not reflect any agreement between him and Mr Bantleman.

93 Again it must be observed that this portion of the Tribunal's reasons does nothing more than summarise the evidence given by Mr Chalwell and express the conclusion that the evidence should be accepted, without enunciating any part of the process of reasoning which led to that conclusion. More specifically, the reasons of the Tribunal do not reveal that any consideration was given to the following highly pertinent facts:

(a) Mr Chalwell did not need any reason to terminate the management authority following the expiry of two years - he could do so without reason upon giving 30 days notice, and on his evidence, had already decided to take that course, knowing that he could do so without reason and as of right;

(b) if, as he testified, Mr Chalwell had already decided to exercise his right to terminate the management authority after the expiry of two years, his receipt of a version of that agreement which specified a term of 13 years had the capacity to thwart his strategy and might naturally have been expected to precipitate a vociferous, emphatic and immediate response if, as he asserted, it had not been the subject of any prior discussion whatever;

(c) each of Mr Chalwell and Mr Bantleman accepted that they had been forthright and direct in their dealings with each other; and

(d) when Mr Chalwell did give notice of termination of the agreement, no reference to Mr Bantleman's alteration of its terms was made in either the notice of termination or any of the communications which followed - in other words the 'ammunition' which Mr Chalwell said he was so pleased to receive was never used,

nor do the Tribunal's reasons explain why Mr Chalwell's evidence on this topic was accepted notwithstanding these undisputed facts.

94 In the final portion of the Tribunal's reasons it adopts a submission made by the Commissioner to the effect that even if Mr Bantleman had sent a copy of the amended management authority to Mr Chalwell with 'sign here' stickers identifying the amended portions, the Commissioner's case could still be made out because the document was a representation to the effect that the parties had agreed to the amended terms. However, what is significantly omitted from consideration at any point of the Tribunal's reasons is the implications to be derived from the fact that Mr Bantleman caused a copy of the amended management authority to be posted to Mr Chalwell very shortly after their meeting, in the assessment of the probabilities of what occurred at that meeting. Those implications are of course even more significant if, as Mr Bantleman asserted, he placed 'sign here' stickers on the document drawing attention to the amended portions, expressly inviting Mr Chalwell's response to the amendments. Those implications remain significant even if, as Mr Chalwell testified, he never received the document, because of the significance of Mr Bantleman's state of mind and subjective beliefs in the context of allegations of unfairness and dishonesty.

95 In the same context the Tribunal concluded:[76]

The 'second' amended Management Authority was sent under the cover of a letter which simply asserted that it was a copy of the agreement between Mr Bantleman and Mr Chalwell. There was nothing to draw Mr Chalwell's attention to either of the amended terms and, indeed, he confirmed in crossexamination that he did not notice that the management fee had been increased.

...

The Tribunal accepts Mr Chalwell's evidence as to what was agreed at the relevant meeting, that is, only the leasing fee for the second lease. The subsequent sending to Mr Chalwell of the 'amended' Management Authority was, in the circumstances, dishonest, or at the least unfair, because 'ordinary, decent people' would consider it so. That is, the sending to a client of an allegedly amended agreement in circumstances which represent to that client that the terms reflect a concluded agreement between the agent and the client is conduct which ordinary, decent people would consider to be dishonest and unfair.

96 When these portions of the reasons are read in the context of the earlier portions to which we have referred, they suggest that the Tribunal was, in substance, addressing the deception case which the Commissioner had abandoned. That inference can be drawn from the Tribunal's reference to the lack of anything to attract Mr Chalwell's attention to either of the amended terms (in a context in which the Commissioner was presenting a misrepresentation case). That inference is also supported by the failure of the Tribunal to address, anywhere in its reasons, precisely why ordinary decent people would consider the making of a representation which, on the Commissioner's case, must be known by the representee to be false, is dishonest and unfair. The same inference is reinforced by the following passage in the Tribunal's conclusion:[77]

Mr Bantleman's conduct does not reflect a simple incorrect recollection of what was discussed at the meeting of 6 August 2013. His evidence needs to be considered in the context of what he did at the meeting and what he did thereafter. The Tribunal finds that Mr Bantleman knew that the agreement as alleged had not been made. For that reason he took no steps to draw the alleged amendments to Mr Chalwell. Mr Bantleman's subjective intention was not to bring the alleged amendments to Mr Chalwell's attention because no such agreement to amend had been made.

97 Ordinarily appeals to this court from decisions of the Tribunal can only be brought on a question of law.[78] However, if the Tribunal's decision has the effect of depriving a person of their capacity to lawfully pursue a vocation, an appeal may be brought on any ground, whether it involves a question of law, a question of fact or a question of mixed law and fact.[79] In this case the effect of the orders ultimately made by the Tribunal was to deprive each of Mr Bantleman and Centex of their capacity to lawfully pursue the vocation of real estate agent. It follows that the ambit of this appeal is not limited to the determination of questions of law, but can include questions of fact and questions of mixed law and fact.

98 A number of the grounds of appeal assert that the Tribunal erred in making specific findings of fact. It is therefore appropriate to set out the general principles properly applied when considering grounds of that kind.

99 The proper role of an appellate court reviewing findings of fact made by a court (or tribunal) at first instance has been essayed in many cases. In Australia the most authoritative statement of the principles governing such a review is to be found in the decision of the High Court of Australia in Fox v Percy.[80] For present purposes it is sufficient to succinctly enunciate propositions developed by the plurality[81] in their reasons:

(a) all appeals are creatures of statute therefore the ambit of any appeal will turn upon the proper construction of the statute creating the right of appeal;

(b) while on the one hand the appellate court is obliged to 'give the judgment which in its opinion ought to have been given in the first instance'[82] on the other, it must, of necessity, observe the 'natural limitations' that exist in the case of any appellate court proceeding wholly or substantially on the records;

(c) these limitations include the disadvantage that the appellate court has when compared with a tribunal at first instance in respect of the evaluation of the credibility of witnesses and of the 'feeling' of a case which cannot be gleaned from the reading of the transcript;

(d) furthermore, an appellate court does not typically get taken to or read all of the evidence taken at trial, with the result that a tribunal at first instance has advantages that derive from considering the entirety of the evidence, and reflecting upon that evidence over a longer interval;

(e) within these constraints an appellate court is obliged to conduct a real review of the trial and is not excused from the task of 'weighing conflicting evidence and drawing [their] own inferences and conclusions, though [they] should always bear in mind that [they have] neither seen nor heard the witnesses and should make due allowance in this respect';[83]

(f) in general an appellate court is in as good a position as the court at first instance to decide on the proper inference to be drawn from facts which are undisputed or, which having been disputed, are established by the findings of the court;[84]

(g) in deciding the proper inference to be drawn the appellate court will give respect and weight to the conclusion of the court at first instance but once having reached its own conclusion will not shrink from giving effect to it;[85]

(h) the mere fact that a trial judge necessarily reached a conclusion favouring the witnesses of one party over those of another does not, and cannot, prevent the performance by a court of appeal of the functions imposed on it by statute;[86]

(i) in some cases incontrovertible facts or uncontested testimony will demonstrate that the conclusions of fact made by the court at first instance are erroneous even when they appear to be, or are stated to be based on credibility findings;[87]

(j) if the decision at trial is glaringly improbable or contrary to compelling inferences the appellate court is not relieved of its statutory functions by the fact that the trial judge has, expressly or implicitly, reached a conclusion influenced by an opinion concerning the credibility of witnesses;[88]

(k) while appellate deference to the decision of a trial judge can be justified by the advantage of assessing the demeanour of witnesses when giving their evidence, more recently caution has been expressed with respect to the weight properly given to assessments of demeanour as compared to an assessment of credibility based upon objectively established facts, contemporary documents and the apparent logic of events.[89]

100 Generally speaking, a trial judge's credibility-based findings will not be reversed on appeal unless it is demonstrated that such findings are flawed by reference to incontrovertible facts or uncontested testimony, or are glaringly improbable or contrary to compelling inferences.[90]

101 A number of the grounds of appeal assert that the reasons given by the Tribunal were inadequate. It is therefore appropriate to set out the general principles which are to be applied when assessing those grounds.

102 Under the common law of Australia there is no free standing duty to give reasons for making a statutory decision.[91] It follows that in any particular case the ambit of any duty to provide reasons will be determined by the proper construction of the statute imposing the obligation to provide reasons. The extent of the Tribunal's obligation to provide reasons has been defined using terms evidently drawn from Commonwealth statutes imposing similar obligations upon administrative decision-makers[92] and obliges the Tribunal to provide its reasons, including its findings on material questions of fact referring to the evidence or other material on which those findings are based.

103 The statutory terminology used to define the obligation to provide reasons can and should be construed in the context of a line of decisions which, notwithstanding their dependence upon particular statutory provisions, inform the approach taken to the construction of particular statutory provisions such as those applicable to this case. The propositions established in those cases include the following:

(a) the primary function of reasons is to allow an appeal court to determine whether the decision involved appellable error and to provide procedural fairness to the litigants who are entitled to know why they have been successful or unsuccessful;[93]

(b) the statement of reasons must explain the actual path of reasoning in sufficient detail to enable a court to see whether the decision is vitiated by error;[94]

(c) reasons need not be lengthy and elaborate, nor do they require a reference to all of the evidence led or to every submission advanced by the parties;[95]

(d) there is no mechanical formula which can be applied to determine whether reasons are adequate in any particular case - much will depend upon the particular circumstances of any individual case;[96]

CENTEX AUSTRALASIA PTY LTD -v- COMMISSIONER FOR CONSUMER PROTECTION [2017] WASCA 79 (21 April 2017)

At a glance

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Judgment (354 paragraphs)

CENTEX AUSTRALASIA PTY LTD -v- COMMISSIONER FOR CONSUMER PROTECTION [2017] WASCA 79 (21 April 2017)

Legislation Cited (4)

Cases Cited (15)