DCB v Secretary of the Department of Education NSW

Legislative background

1. The objectives and guiding principles of the National Law are in section 3: 3 Objectives and guiding principles (1) The objective of this Law is to establish a national education and care services quality framework for the delivery of education and care services to children. (2) The objectives of the national education and care services quality framework are- (a) to ensure the safety, health and wellbeing of children attending education and care services; (b) to improve the educational and developmental outcomes for children attending education and care services; (c) to promote continuous improvement in the provision of quality education and care services; (d) to establish a system of national integration and shared responsibility between participating jurisdictions and the Commonwealth in the administration of the national education and care services quality framework; (e) to improve public knowledge, and access to information, about the quality of education and care services; (f) to reduce the regulatory and administrative burden for education and care services by enabling information to be shared between participating jurisdictions and the Commonwealth. (3) The guiding principles of the national education and care services quality framework are as follows- (a) that the rights and best interests of the child are paramount; (b) that children are successful, competent and capable learners; (c) that the principles of equity, inclusion and diversity underlie this Law; (d) that Australia's Aboriginal and Torres Strait Islander cultures are valued; (e) that the role of parents and families is respected and supported; (f) that best practice is expected in the provision of education and care services.
2. Section 4 provides how the functions under the National Law are to be exercised as follows: 4 How functions to be exercised An entity that has functions under this Law is to exercise its functions having regard to the objectives and guiding principles of the national education and care services quality framework set out in section 3.
3. Person is defined in section 5 the National Law as: "person" means- (a) an individual; or (b) a body corporate; or (c) an eligible association; or (d) a partnership; or (e) a prescribed entity;
4. The National Law provides under Part 2 for a natural person or company to operate an education and care service, which includes family day care services. The applicant in this matter is a company. An applicant must obtain provider approval under Part 2 in order to operate education and care services. The applicant was granted service approval 3 months after the grant of the provider approval.
5. The process under the National Law provides that under Part 2 an applicant must have provider approval from the regulatory body, which is defined in section 5. The Regulatory Authority is defined in section 5 to be: "Regulatory Authority" means a person declared by a law of a participating jurisdiction to be the Regulatory Authority for that jurisdiction or for a class of education and care services for that jurisdiction...
6. Pursuant to section 24 of the Children (Education and Care Services) Supplementary Provisions Act 2011 (NSW) references to Regulatory Authority in the National Law is a reference to the Regulatory Authority for this jurisdiction. Under section 9 of the Children (Education and Care Services National Law Application) Act 2010 (NSW), the Regulatory Authority for this jurisdiction (NSW) is the Director-General of the Department of Education.
7. A provider approval is granted pursuant to section 15 of the National Law.
8. There are conditions which attach to the grant of a provider approval as provided by section 19 of the National Law, and relevantly for this application, to comply with the National Law and regulations or conditions that are determined by the Regulatory Authority. The penalty for failure to comply is $50,000 in the case of a company such as the applicant in this matter.
9. The National Law also provides a mechanism for the Regulatory Authority to suspend or cancel a provider approval and a service approval. Relevantly for this matter section 31 of the National Law provides: 31 Grounds for cancellation of provider approval The Regulatory Authority may cancel a provider approval if- (a) the Regulatory Authority is satisfied that the approved provider or a person with management or control of an education and care service operated by the approved provider is not a fit and proper person to be involved in the provision of an education and care service; or (b) the Regulatory Authority is satisfied that the continued provision of education and care services by the approved provider would constitute an unacceptable risk to the safety, health or wellbeing of any child or class of children being educated and cared for by an education and care service operated by the approved provider; or (c) the approved provider has been found guilty of an indictable offence or an offence that if committed in this jurisdiction would be an indictable offence; or (d) the approved provider has been found guilty of an offence under this Law as applying in any participating jurisdiction; or (e) the approved provider has breached a condition of the provider approval; or (f) the approved provider has not operated any education and care service for a period of more than 12 months (including any period of suspension).
10. If the Regulatory Authority is considering the cancellation of the provider approval under section 31 a "show cause notice" must issue under section 32 of the National Law. In this matter a show cause notice was issued on 27 January 2017. Pursuant to section 32(2)(c) the approved provider may, within 30 days after the notice is given, give the Regulatory Authority a written response to the proposed cancellation. The applicant provided a response to the show cause notice on 28 February 2017.
11. After considering any written response to the show cause notice received within 30 days, the Regulatory Authority may cancel, suspend or decide not to cancel the provider approval pursuant to section 33 of the National Law. The decision is a discretionary decision. The decision is to take effect at the end of 14 days after the date of the decision or other period as specified by the Regulatory Authority. The decision was specified by the Regulatory Authority to take effect from 17 May 2017.
12. In this application the respondent decided to cancel the provider approval because of the alleged breaches of the provider approval by failing to comply with the law in relation to specific requirements under the regulations which are detailed in the show cause notice.

Jurisdiction

1. In CTG v NSW Department of Education Early Childhood and Care Directorate [2017] NSWCATAD 60, Senior Member McAteer determined that the application before the Tribunal is in the review jurisdiction rather than as an external appeal. This decision was followed by the Senior Member in CVT v NSW Department of Education & Communities, Early Childhood Education & Care Directorate [2017] NSWCATAD 74. In CTZ v NSW Department of Education, Early Childhood Education and Care Directorate [2017] NSWCATAD 132 the currently constituted Tribunal considered the same matters in detail. The same Tribunal has since decided DAM v NSW Department of Education and Communities [2017] NSWCATAD 175.
2. Pursuant to section 28 of the Children (Education and Care Services) Supplementary Provisions Act 2011 (NSW) a reference in section 192 of the National Law to a reviewable decision for external review includes "any decision of the Regulatory Authority of a kind specified for the regulations to be a reviewable decision for external review." Clause 114 of the Children (Education and Care Services) Supplementary Provisions Regulation 2012 (NSW) in relation to a reviewable decision states: 114 Reviewable decisions For the purposes of section 28 of the Act, the following decisions of the Regulatory Authority are reviewable decisions for external review: (a) a decision to require an approved provider to employ additional staff, (b) a decision to refuse an application for an approval to provide a child-minding service under Part 8.
3. Pursuant to section 28 (a1) of the Community Services (Complaints, Reviews and Monitoring) Act 1993 (NSW) a decision that is administratively reviewable for external review under section 192 of the National Law Alignment Provisions is to be heard in the Civil and Administrative Tribunal for administrative review under the Administrative Decisions Review Act 1997 (NSW). The National Law Alignment Provisions is defined in section 17 of the Children (Education and Care Services) Supplementary Provisions Act as follows: 17 Alignment with National Law The National Law, as in force from time to time: (a) applies to State regulated education and care services as if those services were education and care services within the meaning of the National Law, and (b) so applies with the modifications provided for by or under this Act, and (c) as so applying may be referred to as the "National Law Alignment Provisions" , and (d) so applies as if it were part of this Act.
4. Section 192 of the National Law relevantly provides: 192 Reviewable decision-external review A reviewable decision for external review is- (a) a decision of the Regulatory Authority made under section 191 (other than a decision in relation to the issue of a compliance direction or a compliance notice); or (b) a decision of the Regulatory Authority under this Law as applying in any participating jurisdiction- (i) to suspend a provider approval under section 27; or (ii) to cancel a provider approval under section 33; or (iii) to suspend a service approval under section 72; or (iv) to cancel a service approval under section 79 or 307; or (v) to suspend or cancel a supervisor certificate under section 125; or (vi) to direct the approved provider of a family day care service to suspend the care and education of children by a family day care educator; or (vii) to give a prohibition notice or to refuse to cancel a prohibition notice. Note : A person is not entitled to a review under this section in respect of a suspension or cancellation of a service approval if that suspension or cancellation relates only to an associated children's service. Any right of review would be under the children's services law.
5. The cancellation of a provider approval under section 33 of the National Law is thus a reviewable decision for external review pursuant to section 192 (b) (ii) of the National Law.
6. Section 193 of the National Law provides: 193 Application for review of decision of the Regulatory Authority (1) A person who is the subject of a reviewable decision for external review may apply to the relevant tribunal or court for a review of the decision. (2) An application must be made within 30 days after the day on which the applicant is notified of the decision that is to be reviewed. (3) After hearing the matter, the relevant tribunal or court may- (a) confirm the decision of the Regulatory Authority; or (b) amend the decision of the Regulatory Authority; or (c) substitute another decision for the decision of the Regulatory Authority. (4) In determining any application under this section, the relevant tribunal or court may have regard to any decision under this Law as applying in another participating jurisdiction of a relevant tribunal or court of that jurisdiction.
7. In section 5 of the National Law the definition of relevant tribunal or court is: "relevant tribunal or court" , in relation to a participating jurisdiction, means the tribunal or court declared by a law of that jurisdiction to be the relevant tribunal or court for the purposes of this Law or a provision of this Law;
8. In section 8 of the Children (Education and Care Services National Law Application) Act 2010 the relevant Tribunal is declared: 8 Relevant tribunal or court For the purposes of the definition of "relevant tribunal or court" in section 5 of the Children (Education and Care Services) National Law (NSW) : (a) the District Court is declared to be the relevant tribunal or court for this jurisdiction for the purposes of section 181 of that Law, and (b) the Civil and Administrative Tribunal is declared to be the relevant tribunal or court for this jurisdiction for the purposes of Part 8 of that Law.
9. Therefore, the scheme of the legislation is that the Civil and Administrative Tribunal is the relevant tribunal to which an application may be made for external review of a decision of the Regulatory Authority under section 79 of the National Law. The powers given to the Tribunal by section 193 of the National Law are not as extensive as the powers under section 63(3) of the Administrative Decisions Review Act 1997 (NSW). Section 194 of the National Law provides that the National Law does not limit the act which establishes the relevant tribunal. This may mean that section 65 of the Administrative Decisions Review Act and the power to remit the matter for further consideration by the Regulatory Authority is an additional power of the Tribunal.
10. Since the application to this Tribunal is an administrative review it is considered that the Tribunal is to decide what the correct and preferable decision is having regard to the material before it: section 63(1) Administrative Decisions Review Act 1997 (NSW); YG & GG v Minister for Community Services [2002] NSWCA 247, Hodgson JA (with whom Foster and Brownie AJJA agreed) at [25].

The evidence relied upon in the interim hearing

1. The documents in evidence for the interim application before the Tribunal are: 1. Application for stay or interim order filed 16 May 2017 annexing a letter from the solicitor for the applicant and the notice of decision to cancel the provider approval dated 2 May 2017: Exhibit 1. 2. Affidavit of a Director of the applicant dated 24 May 2017 and filed the same date: Exhibit 2. 3. A bundle of documents prepared by the respondent and filed on 25 May 2017: Exhibit 3.
2. The Tribunal was also assisted by the parties' representatives and their respective oral submissions.

Other Legislative Provisions relevant to the interim decision

1. The guiding principle to be applied to practice and procedure in the Tribunal "is to facilitate the just, quick and cheap resolution of the real issues in the proceedings" consistent with the objects and principles under the Act: section 36 of the Civil and Administrative Tribunal Act.
2. The Tribunal may determine its own procedure in relation to any matter for which the Civil and Administrative Tribunal Act, or Civil and Administrative Rules 2014 do not otherwise make provision. Additionally, the Tribunal is not bound by the rules of evidence (except in relation to privileged disclosures, for example under section 128 of the Evidence Act 1995), and is to act with as little formality as the circumstances permit to appropriately determine matters without regard to technicalities or legal form: sections 38, and 67 of the Civil and Administrative Tribunal Act; Kostas v HIA Insurance Services Pty Ltd [2010] HCA 32.
3. Procedural fairness and other aspects of natural justice, of course, are to apply to these proceedings and the Tribunal has a discretion to act on material which is rationally probative, but must determine in all the circumstances whether it is proper to act on that material and must act fairly towards the parties: see e.g. Commission for Children and Young People v FZ [2011] NSWCA 111; Roberts v Balancio (1987) 8 NSWLR 436.
4. The Administrative and Equal Opportunity Division ("AEOD") of the Tribunal has its practice and procedure prescribed by reason of Schedule 3 of the Civil and Administrative Tribunal Act. Relevantly, a party to proceedings in this division on an application for review of this current decision is not entitled to be represented by a lawyer without seeking leave of the Tribunal: see sections 16, 17 and Schedule 3, clause 9(1), of the Civil and Administrative Tribunal Act. Also, costs may be awarded; see schedule 3, clause 13.

The Issue

1. The applicant seeks to stay the decision of the NSW Department of Education and Communities made on 2 May 2017. The applicant seeks that the operation of the decision should be stayed until after a further and more complete hearing. The Tribunal has to determine whether it is desirable to do so after taking into account: 1. the interests of any persons who may be affected by the determination of the application, and 2. any submission made by or on behalf of the administrator who made the decision to which the application relates, and 3. the public interest.
2. Additionally, conditions may be imposed while granting a stay for a specified period of time, or if no period is specified until the decision of the Tribunal on the application takes effect: section 62 Administrative Decisions Review Act; Elgammal v Director General, Department of Transport [1999] NSWADT 82.
3. Generally, in civil litigation, a stay of the operation of a decision pending an appeal is granted where a successful appeal would be useless or futile unless the stay were granted: Polini v Gray (1879) 12 Ch D 438. This application is not an appeal but an administrative review, but there is force in the rationale behind the grant of a stay in those circumstances.
4. It has also been said that the overriding principle in any stay application is that of upholding the interests of justice in the particular circumstances: New South Wales Bar Association v Stevens [2003] NSWCA 95 at [83].
5. Where a decision has been made in the public interest, the protection of the public is a matter entitled to significant weight: New South Wales Bar Association v Stevens (supra) at [90]-[104].
6. In New South Wales Bar Association v Stevens (supra) His Honour Chief Justice Spigelman (as he then was), with whom Meagher and Sheller JJA agreed, said this of the public interest at [103]-[104]: "[103] The significance of the public interest dimension in the exercise of the discretion to grant a stay in such circumstances, was highlighted by Kirby J in Bryant v Commonwealth Bank of Australia (1996) 70 ALJR 306 at 309 where his Honour said: "In the exercise of the jurisdiction to provide a stay, it has often been emphasised that cases involving a stay of the operation of the criminal law or of laws designed to protect the public (e.g. deregistration of a professional lawyer or medical practitioner) are in a class different from cases involving no more than the suspension of the operation of orders affecting two private litigants only." [104] It is clear from this consideration of the authorities that each case must turn on its specific facts. The range of relevant considerations is broad. Nevertheless the fact that the issues involved in professional rights to practice concern the protection of the public, means that the public interest is always entitled to significant weight."
7. As previously referred to, the issue the Tribunal is to decide in these proceedings is what "the correct and preferable decision is having regard to the material then before it" including material which may not have been before the NSW Department of Education and Communities: section 63(1) Administrative Decisions Review Act 1997 (NSW); YG & GG v Minister for Community Services [2002] NSWCA 247, Hodgson JA (with whom Foster and Brownie AJJA agreed) at [25].
8. There is no requirement upon the applicant to show that the original decision maker's decision was wrong: Re Control Investments Pty Ltd v Australian Broadcasting Tribunal (No 2) (1981) 3 ALD 88.

Considerations and the Evidence

1. The application and approval was made under the National Law where various criteria for approval and maintaining of the currency of the approval are set out.
2. The applicant has been operating its childcare business and seemed to run it appropriately apart from a visit on 1 August 2014 which identified an alleged breach in that the approved provider was unable to provide a register of family day-care educators that contained the prescribed information in respect of each family day-care educator engaged or registered with a family day-care service to educate and care for children. There is no evidence as to when the business actually commenced operating.
3. The applicant records in the affidavit from the Director (Exhibit 2) that there are some concessions but equally there are refutations of the alleged breaches. The applicant has indicated that it is capable of remedying any breach identified by the respondent. The applicant has engaged a specialist compliance consulting firm after the inspection in order to assist it to comply with the National Law. The applicant will continue to engage with the consultant to ensure compliance with its obligations under the National Law.
4. The fortnightly expenses of the applicant to conduct its business is about $12,400. The applicant will incur a liability between the dates 17 May 2017 to 17 November 2017 of approximately $161,200. The applicant operates with approximately 200 students and 30 educators. It is not a minor business. The educators in the employ of the applicant receive a cumulative income of approximately $50,000 per fortnight.
5. In the event that the stay was not granted the parents of the students and the educators would have to move to other providers and there would be no business for the applicant to operate if the final decision is in its favour. It is likely the applicant would become insolvent and be involuntarily liquidated if the stay is not granted.
6. The guiding principles under the National Law are in subsection 3(3) stated to be: (3) The guiding principles of the national education and care services quality framework are as follows- (a) that the rights and best interests of the child are paramount; (b) that children are successful, competent and capable learners; (c) that the principles of equity, inclusion and diversity underlie this Law; (d) that Australia's Aboriginal and Torres Strait Islander cultures are valued; (e) that the role of parents and families is respected and supported; (f) that best practice is expected in the provision of education and care services.
7. The rights and best interests of the child are paramount in implementing the National Law. Since section 4 of the National Law requires an entity that has functions under the law to exercise those functions having regard to the objectives and guiding principles set out in section 3, the Tribunal is required to regard the rights and best interests of the child as paramount in making a determination as to the correct and preferable decision in this matter.
8. It is in the interests of all those involved in the provision of the applicant's childcare services and the consumers of those services for there to be as little interruption to those services as possible until a final determination is made in the Tribunal.
9. The administrator has made relevant submissions.
10. It is in the public interest for properly run services to continue to operate. These services provide a worthwhile and much-needed public benefit for the care and education of children.

Conclusion

1. The ultimate determination of the correct and preferable decision must regard the best interests of the child who may receive the benefit of the service as paramount.
2. The National Law facilitates the provision of a national education and care services quality framework for the delivery of education and care services to children. The fact that the applicant received service approval to run a Family Day Care Service is an indication that the applicant was considered capable of providing quality education and care services to children. The fact that the service has operated successfully is also an indication that it has been viewed favourably by parents of the children who benefit from its service.
3. The applicant says that the administrative review will be rendered nugatory if there is not a stay. The respondent says that there was an unacceptable risk of harm to the children because the Working with Children Check Clearances were not provided, the risk assessment of residences was not undertaken, and there was a complaint by a member of the public. The respondent submitted that there were hazardous environments for the children.
4. A successful review would be useless or futile unless the stay was granted. In all of the circumstances, including that factor, a stay of the operation of a decision pending the review is indicated. The overriding principle in any stay application is that of upholding the interests of justice in the particular circumstances, and the interests of justice in this matter require that the decision not be acted upon until the review is determined.
5. An order under section 60 of the Administrative Decisions Review Act to stay the operation of the decision is desirable to do so after taking into account the matters required in the subsections. In particular it is in the interests of the applicant for the service to continue to operate unimpeded until a final determination is made. It is in the interests of the parents and children for the service to continue to operate until a final decision is made. It is in the public interest for the service to continue to operate provided it operates properly and within the National Law. Since it is in dispute as to whether there is compliance by the applicant with the National Law, in relation to some of the breaches alleged, and there are concessions made in relation to some other breaches alleged the proposals made for remedying those alleged breaches, it is not in the public interest to reach a precipitous and potentially damaging conclusion before considering all of the evidence.
6. The matter has been allocated a final hearing date on 14 July 2017. Directions were made to prepare the matter for hearing. At the hearing the Tribunal will be able to determine whether the provider approval should be cancelled and what the correct and preferable decision is having regard to the evidence. The period of time during which the applicant will continue to operate is limited by the hearing date. Any decision made by the Tribunal will not be rendered nugatory because the stay is in place.
7. It was for these reasons that a stay was granted on 25 May 2017.

Order

1. The order of the Tribunal is that: 1. The decision of the respondent on 2 May 2017 to cancel the applicant's provider approval under the Children (Education and Care Services) National Law (NSW) is stayed until the final determination of the Tribunal of the Administrative review application filed 16 May 2017.

Endnotes

1. See section 28(1)(a1) Community Services (Complaints, Reviews and Monitoring) Act 1993 (NSW)
2. See section 28(1)(b) Community Services (Complaints, Reviews and Monitoring) Act 1993 (NSW) I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales. Registrar DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 16 June 2017