Grounds 11 and 12: [48] and [51] of the AAT's reasons
156 Mr Frugtniet advanced these grounds together. They were as follows:
11. Whether the Tribunal erred in law by the construction and application of the Credit Act that the applicant had an obligation to disclose to the respondent that he was the subject of a complaint. Moreover, the statement of the applicant that he had not attracted detrimental attention as a migration agent was incorrect and misleading was not available on the evidence (Tribunal Decision at [48]).
12. Whether the Tribunal erred in law when it failed to take relevant considerations into account that the decision of MARA was provided to the Tribunal as part of the stay applications and review applications relating to the MARA matter in which the present Member was constituted and correspondence was undertaken between the Tribunal, the Member's Associate and the applicant, including there being no requirement under the Credit Act to disclose the decision to the respondent which was publicly available, and was accessed and downloaded before the commencement of these Tribunal proceedings by its investigator (Tribunal Decision at [49] and [51]).
157 The paragraphs of the AAT's reasons to which the grounds relate are these (mis-numbering of paragraphs in the original):
48. In respect of the MARA decision of 6 November 2014 to cancel Mr Frugtniet's registration as a migration agent, the Tribunal does not accept his assertion that he had no obligation to disclose the decision to the respondent before the hearing. When he compiled his Statement of Facts and Contentions dated 20 October 2014 Mr Frugtniet was aware that the matter was before MARA as a result of a complaint against him because a notice was issued to him by MARA on 5 September 2014 informing him of its proceedings. His assertion that he had not attracted detrimental attention as a migration agent was incorrect and misleading, not only because of the complaint that led to the proceedings by MARA but also because of adverse media articles identified by Mr McKinnon.
49. Mr Frugtniet was aware of the decision by MARA to cancel his registration as a migration agent when he prepared his statement to the Tribunal dated 27 November 2014 in reply to the respondent's Statement of Facts, Issues and Contentions, and the decision by MARA was clearly relevant to the application under review because it was another example of a finding that Mr Frugtniet was not a fit and proper person. Mr Frugtniet should have provided the decision to the respondent and to the Tribunal as soon as he became aware of it.
49. The Tribunal does not accept Mr Frugtniet's statement in his application for a stay of the implementation of the decision under review that there has not been … a single complaint. The meaning of the word complaint in the Macquarie Dictionary is information in written form giving details of an alleged criminal offence. There is no requirement for proof or substantiation, because a complaint is the process by which an allegation is raised and brought to the attention of the relevant person or authority. Consequently Mr Frugtniet was aware that a person had made allegations against him when he sought a stay of the decision under review, even if the complaint had not been substantiated at the time.
…
51. Mr Frugtniet has been told that he is required to disclose his past conduct in a complete and accurate manner. Despite this, he has shown a complete lack of insight into his past conduct, and has failed to make full and frank disclosure to the Tribunal. His action in failing to disclose to the respondent and to the Tribunal, until the hearing of the application under review, the decision by MARA on 6 November 2014 to cancel his registration as a migration agent shows that he has learnt nothing from previous findings about his character. Similarly his assertion that he has not been the subject of a single complaint about his behaviour as a credit facilitator is wrong and misleading.
158 It was clear from Mr Frugtniet's oral submissions that the essence of these grounds was that the AAT had concluded that he was under a legal obligation to disclose, prior to hearing, the facts of his interactions with MARA, and that that was in error because there was no such obligation. I accept that it would be an error of law to conclude that there was a legal obligation to disclose a matter if, in fact, there was not such a legal obligation.
159 I am not persuaded that the AAT used the word "obligation" to denote, strictly, a legal obligation, in the sense of identifying a statutory provision that would be contravened in the absence of disclosure by Mr Frugtniet of the facts relating to MARA. Rather, I think that the AAT had in mind something more informal. In effect, my view is that the AAT determined that the manner in which Mr Frugtniet dealt with the disclosure of the MARA decision carried with it the real risk of misleading the AAT and ASIC by omission or by half-truth, and that to have so dealt with disclosure was dishonest and counted against him in the fitness and propriety assessment. By the impugned phrase - "the Tribunal does not accept his assertion that he had no obligation to disclose" - the Tribunal meant, in my opinion, that any such asserted lack of legal obligation did not detract from the wrongfulness of Mr Frugtniet's conduct. In short, the AAT considered that Mr Frugtniet's conduct was deceptive; Mr Frugtniet's submission was that his conduct was defensible at law; the AAT's rejoinder was that it did not matter whether it was defensible at law, it remained dishonest: it did not accept that any asserted lack of legal obligation was exculpatory. I give more detailed reasons below for arriving at that view.
160 The context in which the AAT referred to an "obligation" is, I think, revealed in Mr Frugtniet's cross-examination before the AAT. Mr Frugtniet agreed under cross-examination that in September 2014 he was aware that a complaint had been made against him, and that a notice had been issued under s 309 of the Migration Act 1958 (Cth), inviting submissions in respect of consideration by MARA whether to cancel or suspend Mr Frugtniet's registration as a migration agent. He agreed that he had not mentioned that in his statement of facts, contentions, and issues dated 20 October 2014 ("SOFCI"). Rather, at [25] of his SOFCI, he had said the following:
The applicant appears to have been successful as a migration agent for 16 years without attracting detrimental attention. He remains a fit and proper person for the purpose of providing migration services - this fact should be treated as relevant to the question whether he can be categorized as fit and proper for the purposes of registration as a representative providing credit services.
161 It was put to Mr Frugtniet that, given his history of previous findings of dishonesty or a lack of full and frank disclosure, his SOFCI had been a perfect opportunity to disclose MARA's s 309 notice. Mr Frugtniet rejected the proposition and said that his SOFCI related to the documents lodged under s 37 of the AAT Act. I interpolate here to note that Mr Frugtniet had earlier submitted, at the commencement of the AAT hearing, that he was not obliged to make a statement of evidence and that ASIC ought to present its case first, leaving him to respond. That submission was rejected by the AAT, and Mr Frugtniet went first.
162 It was put to Mr Frugtniet in cross-examination that he was not limited in his SOFCI to addressing the s 37 documents and that he could have put on more evidence of his own and that he had chosen not to do that for reasons he had given. Mr Frugtniet responded, "Yes, for reasons that I was going to give it here. I was not going to prejudice my case, as I've said in my preceding answer, on the authorities that I didn't have to go first, and that I didn't have - not for any other reason - that I didn't have to show my hand. The context being is that I would give this evidence here after, for the very reasons I outlined, that the respondent had actually gone first because of matters I outlined."
163 It was put to Mr Frugtniet that his case involved showing that he was full and frank in his disclosure, and honest, and that it might have been more judicious to have brought the MARA issue to ASIC's attention sooner rather than later. Mr Frugtniet rejected the proposition, on the basis of the authorities he had earlier referenced concerning his obligation to put on a statement of evidence. He confirmed he was relying "on a legal position."
164 On 6 November 2014, Mr Frugtniet's registration as a Migration Agent was cancelled. On 27 November 2014, Mr Frugtniet lodged his statement in reply of facts, issues and contentions ("Reply SOFCI"). That statement contained no reference to his registration having been cancelled or to any of the findings made in MARA's decision. In his cross-examination, various questions were put to Mr Frugtniet concerning why he had not raised the MARA issue in his Reply SOFCI, and whether, in his principal SOFCI, he had been wrong to say that he had not attracted adverse attention when he knew that a complaint had been made against him and an investigation commenced. Substantially, he rejected that he should have referred to the MARA decision in his Reply SOFCI, and denied that it was wrong to say that he had not attracted adverse attention.
165 Mr Frugtniet agreed under cross-examination that MARA's decision was relevant to the matter then before the AAT. He also agreed that he had not mentioned it until his oral evidence and had not brought a copy of it with him to the AAT hearing.
166 The Senior Member asked Mr Frugtniet why he had not updated what he had said at [25] of his SOFCI in light of what subsequently happened, namely that his registration as a migration agent had been cancelled. Mr Frugtniet replied that his November Reply SOFCI was "a reply to the respondents' statement of facts, issues and contention, as opposed to taking out in a miniscule way any paragraph and saying this is what I'm doing, because it was a reply". The Senior Member asked the following questions:
… I mean, you gave evidence this morning?---Yes.
And I took you through the statement of facts and contentions myself before Mr Knowles asked you questions?---Yes.
And you didn't say to me, "Wait a moment, I need to amend paragraph 25". You didn't' say that. I'm just wondering why you didn't do that?---I wasn't looking at each and every paragraph, sir. As I gave that evidence I was giving a bit of narrative.
Okay?---Of - in terms, as I said before, sometimes hard to delineate between facts, contentions and issues and evidence, and therefore I was indebted when the Member asked me questions and I kept going back as my - - -
Okay?---As my memory was rekindled into saying exactly what I thought of matters in a factual sense.
167 The way that ASIC advanced its case before the AAT involved a focus upon "full and frank disclosure". Particularly on the basis of earlier warnings to Mr Frugtniet from, inter alios, Pagone J, ASIC's proposition was that Mr Frugtniet knew or ought to have known that anything other than fullness and frankness in a disclosure created the risk that the disclosure would be misleading or deceptive. Its proposition was further that Mr Frugtniet had not been full and frank in his disclosures to the AAT (and, for that matter, to ASIC), as was evidenced by [25] of his SOFCI and his failure to mention MARA's decision in his Reply SOFCI.
168 Conversely, Mr Frugtniet's case before the AAT was that he was not under an obligation to have made any disclosures to ASIC, and that his approach to disclosing MARA's decision to the AAT was unobjectionable.
169 The AAT's reasons, read as a whole, disclose that it accepted ASIC's submissions. The critical sentence, in my opinion is the first sentence of [51], which states that Mr Frugtniet had been told that he is "required to disclose his past conduct in a complete and accurate manner" (emphasis added). In other words, where a disclosure is made, it is to be made completely and accurately, and not by half-truth or in a way that is misleading. It would be wrong to state half-truths to the AAT or to ASIC, or to mislead them. I do not think any reasonable litigant could disagree with the proposition that to mislead the fact-finder, or one's opponent, by omission or by stating half-truths would be wrong, and probably dishonest, even if it did not attract legal sanction. In any event, were it necessary to find a legislative expression of that sentiment I think it could be found in the combination of ss 2A and 33 of the AAT Act, which I will set out in reverse order below, so far as is relevant:
33 Procedure of Tribunal
…
(1AB) A party to a proceeding before the Tribunal, and any party representing such a party, must use his or her best endeavours to assist the Tribunal to fulfil the objective in section 2A
2A Tribunal's objective
In carrying out its functions, the Tribunal must pursue the objective of providing a mechanism of review that:
…
(b) is fair, just, economical, informal and quick; and
…
(d) promotes public trust and confidence in the decision-making of the Tribunal.
170 It seems to me highly likely that to mislead the AAT and one's opponent by omission or by half-truth would be inconsistent with a party's obligation under s 33(1AB) of the AAT Act.
171 Here, Mr Frugtniet had made a positive statement, at [25] of his SOFCI, that he had been successful for 16 years as a migration agent "without attracting detrimental attention." That was at best a half-truth. It concealed far more than it revealed. It was inconsistent with the "requirement" - or the obligation - to be complete and accurate in making disclosures. So, too, was the failure to correct it in the Reply SOFCI. In saying that it did not "Accept [Mr Frugtniet's] assertion that he had no obligation to disclose …", I think the AAT was really saying that it did not accept that any such asserted lack of legal obligation excused the failure by Mr Frugtniet to be complete and accurate in his disclosures.
172 Seen in that way, the AAT was doing no more than saying that Mr Frugtniet's conduct in relation to disclosing the MARA matters was dishonest, or otherwise than full and frank, and that in either case that counted against him in an assessment of his fitness and propriety. An absence of legal obligation to act differently did not excuse Mr Frugtniet's conduct. That is a finding of fact with which I cannot interfere.
173 The other aspects of grounds 11 and 12 can be far more quickly dealt with. It is said in the last sentence of ground 11 that it was unavailable on the evidence to find that it was incorrect or misleading for Mr Frugtniet to have said, at [25] of his SOFCI, that he had not been the subject of any detrimental attention. I disagree. The fact of MARA having issued to Mr Frugtniet a s 309 notice in relation to a complaint that had been made against him provided a more-than-adequate basis for the AAT to have made the finding that it made.
174 Ground 12 relied upon establishing that the AAT was required to take into account three matters in making its findings, namely that Mr Frugtniet had previously provided MARA's decision to the Tribunal (albeit in a different proceeding), that there was no requirement under the NCCP Act to disclose the decision to ASIC, and that ASIC was in any event aware of MARA's decision. The second of those matters is really a repetition of ground 11, which I have already rejected. And, there is simply no basis in the statute for asserting that these were mandatory considerations. Mr Frugtniet's real complaint is that the facts were found against him. Ground 12 must fail.
175 Before leaving ground 12, however, I must deal with Mr Frugtniet's remarkable submission that, because he had provided MARA's November 2014 decision to the AAT in a different matter - a matter in which, as it happened, the Tribunal was constituted by the same Senior Member - "the Tribunal was apprised" of that decision and therefore that "the Tribunal Member is being disingenuous" in holding that Mr Frugtniet had failed to disclose MARA's decision to the AAT and to ASIC. To be disingenuous is to be lacking in candour or frankness, insincere, or morally fraudulent. For Mr Frugtniet to have made that submission about the Senior Member shows a stunning lack of self-awareness. It is completely baseless and should never have been put.
176 Lodging a document in one proceeding cannot possibly constitute disclosing that document in every proceeding in the same forum for all time, whether the Tribunal in a particular proceeding is constituted by the same member or not. If a disclosure should properly be made in one proceeding, it does not suffice to disclose it in another proceeding. Mr Frugtniet's submission appears to suggest that the Senior Member should, when presented with MARA's decision in the MARA matter, have said unprompted to the parties in the ASIC matter that a document had been lodged in a different matter that appeared to him to have been relevant and so he intended to take it into account in the ASIC matter. Disregarding the question of whether or not that would be permissible, Mr Frugtniet surely could not have expected that the AAT would do so. And, by the time of the hearing, it would have been evident to Mr Frugtniet that the AAT had not given that indication to the parties, so at best for Mr Frugtniet he had provided a document to the AAT without his opponent's knowledge. That would ordinarily be improper. And it is clear, in any event, that disclosure to the AAT is not the same as disclosure to ASIC, so Mr Frugtniet has no basis whatever for disputing the suggestion that he had failed to disclose MARA's decision to ASIC.
177 Mr Frugtniet's complaints were that the AAT had regard to prohibited considerations, and failed to have regard to mandatory considerations. These are questions of law. ASIC's notice of objection to competency does not succeed in respect of grounds 11 and 12.