Frugtniet v Australian Securities and Investments Commission

Federal Court of Australia (Full Court)|2017-10-12|Before: Gleeson JJ

Background facts 5 An important aspect of this appeal concerns whether the Tribunal was entitled to have regard to historical matters that, according to Mr Frugtniet, the Tribunal was required to disregard. The Tribunal recorded, at [34] of its decision record, the following submission made by Mr Frugtniet: Mr Frugtniet said that an assessment of whether he is a fit and proper person should be made in the context of his current activities in the field of providing credit facilities rather than concentrating on past matters, except where relevant. He said that there are no matters that affect adversely his character, honesty and ability to deal in credit activities. 6 The historical matters recorded by the Tribunal (including observations made by Mr Frugtniet to the Tribunal about those matters), which are not in issue on the appeal, are set out in [7] to [30] below. 7 In 1978, Mr Frugtniet was convicted in the United Kingdom on 15 counts of handling stolen goods, forgery, and obtaining property by deception and theft ("1978 UK convictions"). He was sentenced to a term of imprisonment and served two years. Mr Frugtniet said that the sentence was spent under Commonwealth legislation and, therefore, not relevant to his application for review of the banning order. 8 In 1995, the Administrative Appeals Tribunal of Victoria ("Victorian AAT") found that Mr Frugtniet had been involved in the conduct of Tarson Pty Ltd ("Tarson"), a travel agency of which his former wife was a director. This was in breach of a special condition imposed on the agency excluding Mr Frugtniet from any involvement in the business. Mr Frugtniet said that Tarson breached the licence condition, and he was not a party to the proceeding, and so the issue was not relevant to his application for review of the banning order. 9 In 1997, in the Broadmeadows Magistrates' Court, Mr Frugtniet was found guilty of obtaining property by deception in relation to the issue of airline tickets. Mr Frugtniet was fined $1,000 but no conviction was recorded. Mr Frugtniet said that, as no conviction was recorded, the matter was not relevant to his application for review of the banning order. 10 In March 1998, Mr Frugtniet was charged with six counts of theft and three counts of attempted theft, in which it was alleged that he had given personal details of accounts to an accomplice while working at the ANZ Bank. 11 On 26 October 1999, Mr Frugtniet applied to the Migration Agent Registration Authority ("MARA") for registration as a migration agent and answered "No" to a question asking whether he was the subject of criminal charges still pending before a court. At the time, Mr Frugtniet was the subject of the pending criminal charges concerning his employment with the ANZ Bank. In March 2000 he was acquitted of the charges, while a person charged as an accomplice pleaded guilty. 12 In 2001, Mr Frugtniet applied to the Victorian Board of Examiners for admission to practise as a barrister and solicitor and an officer of the Supreme Court of Victoria ("Supreme Court"). His application was refused, and in 2002 the Supreme Court dismissed Mr Frugtniet's appeal against the decision, finding that Mr Frugtniet had failed to satisfy the Court that he was a fit and proper person for admission to legal practice: Frugtniet v Board of Examiners [2002] VSC 140. In that decision, Pagone J stated at [12]: [Mr Frugtniet] accepted during his submissions to me that the perjury charges, the ANZ charges and the UK convictions were matters that ought to have been disclosed and considered in deciding whether he was a fit and proper person for admission to practice. The Board of Examiners might itself have found in his favour if he had candidly laid out these matters, and if he had done so, there would have been more prospect of the present appeal succeeding. However, these were matters that only came to light upon investigations undertaken by the Board itself after its adverse decision, after [Mr Frugtniet's] institution of this appeal and after [Mr Frugtniet] had filed his first affidavit in this court in support of the appeal. In those circumstances I have no present confidence that [Mr Frugtniet] would have disclosed these matters if they had not come to the Board's knowledge and had the Board not tendered the evidence in the proceeding before me. 13 In May 2002, MARA initiated a complaint against Mr Frugtniet about his conduct as a migration agent, concerning possible false declarations arising from his answers to questions about his involvement in past investigations or inquiries. In February 2003, MARA decided to take no further action at that stage in relation to the complaint, but MARA informed Mr Frugtniet: However, the Authority reminds you that the legislation requires you to declare any charges other than spent convictions and you are required to declare them in the future. Should further information regarding this matter come to the attention of the Authority or should the content of this complaint demonstrate a pattern of behaviour which is disclosed in other complaints then the Authority may take this matter into account in future deliberations. 14 Mr Frugtniet said that ASIC had been provided with documents showing that the matter of the false declarations had been investigated, that MARA had found that no false declarations were made and, accordingly, the matter was not relevant to his application for review of the banning order. 15 In July 2004, Mr Frugtniet applied again to the Board of Examiners for admission to practise. His application was refused in February 2005 and in August 2005 the Supreme Court dismissed his appeal against the decision: Frugtniet v Board of Examiners [2005] VSC 332. Gillard J stated at [47], concerning Mr Frigtniet's application to MARA on 26 October 1999 referred to above: The date of the declaration is 26 October 1999. On no view could that answer be correct. He admits as much now. At that time he was facing nine charges concerning his employment at the ANZ Bank. The answer to the question: "Are you the subject of any criminal charges still pending before a court?" should have been "Yes". When asked by the Court as to his explanation, the appellant prevaricated, did not initially answer the question but referred to the fact that the matter was raised years later by MARA, he gave them an explanation and no further action was taken by the authority. Eventually he admitted to the Court that his answer was wrong and he should have answered "Yes". Another matter of concern is that he did not appreciate the importance of making a false declaration. He informed the Court that he had in fact in a separate document told MARA of the charges. He was unable to produce a copy and MARA did not have any copy. I have grave doubts about his evidence. But as was put to him, if he was revealing this information to MARA in another way, then his answer should have been "Yes", and reference back to an earlier communication. The way he gave evidence in relation to this raises considerable concerns about his honesty and more importantly whether he is prepared to be frank about his past indiscretions. His seemingly ignorant attitude to the importance of a statutory declaration is also a matter of concern. As the Court asked him "Would you advise a client to do what you did in the circumstances?" He said "No". Gillard J stated further: [67] The appellant carries with him a massive bag of dishonest conduct. It is a pattern of conduct committed over an extensive period ... [68] His pattern of conduct raises a substantial question mark concerning his honesty and his character and reputation. He is a person who does not appear to have learned from his experiences during 1989 to 2000. He carries a very heavy burden of persuading this Court that he is a person of good character and reputation and a fit and proper person to practise law. He has not discharged that burden. The way he has presented himself to this Court shows a man who is loose with the truth and is prepared to distort the truth if he thinks it will help him. Often he was asked questions which he failed to answer and went off on some tangent seeking to minimise his criminality in the past. The evidence does not persuade me that the appellant has learned from his past experience, or that he is a person motivated to tell the truth. ... [70] The appellant has to frankly and candidly state the level of his dishonesty in the past, and not seek to hide it. He must show that it will not reoccur. Unfortunately he has not demonstrated any of these matters to the Court. Indeed, he is one of those witnesses who, when asked a question, thinks how he should answer the question rather than answering it truthfully and accurately. It will take, in my view, many years of blameless conduct before one could have any confidence that the appellant has shed his past, turned over a new leaf and intends to pursue a blameless and honest career. 16 Mr Frugtniet accepted that he was unable to satisfy the requirements for admission because he had failed to make full disclosure under Victorian legislation. He said that this was caused by his mindset at the time, as he believed that he was not required to disclose spent convictions. 17 In September 2004, the Tribunal made a decision on an application by Mr Frugtniet in relation to an overpayment of social security payments to him: Frugtniet and Secretary, Department of Family and Community Services [2004] AATA 996. The Tribunal found that the debt owed by Mr Frugtniet was incapable of being waived under social security legislation because the debt had resulted from Mr Frugtniet knowingly making false statements in support of his application for social security benefits. The Tribunal stated at para 36 of its 2004 decision record: In this case, Mr Frugtniet was clearly aware, at the time that he made the statements, that he was employed on a full-time basis by Network Recruitment and the evidence was that his migration practice had also become active again, which explained the deductions claimed in his 2000 income tax return. Therefore, the answer "No" to a question asking whether he did any work in the relevant period must have been made in the full knowledge of the falsity of that statement ... 18 However, the Tribunal set aside the decision to recover the debt because of the Department's failure to comply with data-matching legislation. 19 Mr Frugtniet denied making false statements and said that he would have appealed against the Tribunal's findings, but was unable to do so because he had been successful in recovering the amount of the debt in full. He said that no further recovery action had been brought against him. 20 In July 2005, Unique Mortgage Services Pty Ltd ("UMS") (of which Mr Frugtniet was the sole director, secretary and shareholder) and Australian Finance Group ("AFG") entered into an agreement in which UMS would receive a commission for referring potential customers to AFG. Mr Frugtniet declared to AFG that he had not been convicted of an offence involving a criminal charge relating to fraud, dishonesty or deceptive conduct in the previous ten years; had not been refused membership of a statutory professional body; and had not been subject to disciplinary proceedings by a statutory professional body. 21 Mr Frugtniet told the Tribunal that his answers were technically correct at the time and, in cross-examination, maintained that there was no need to divulge other proceedings, including the criminal proceedings and Supreme Court matters. 22 On 25 May 2010 at Werribee Magistrates' Court, Mr Frugtniet deliberately and falsely represented to a barrister that he was a solicitor and deliberately gave to a magistrate the false impression that he was a solicitor. 23 In November 2010, UMS lodged an application for an Australian credit licence with ASIC and this was granted, effective from 24 December 2010. Mr Frugtniet was the sole director, secretary and shareholder, and he declared in the application form that all the information that he had provided was complete and accurate, including questions about his status as a fit and proper person. 24 Mr Frugtniet stated that he did not make any false statements in the application as he was not refused a right in which authorisation was required; was not the subject of disciplinary proceedings in relation to such an authorisation; was not the subject of an investigation that may result in disciplinary proceedings in relation to such an authorisation; and was not the subject of any proceedings that were determined adversely as he was not a lay associate nor intended to be one in respect of the proceedings at Werribee Magistrates' Court. 25 In April 2011, the Victorian Civil and Administrative Tribunal ("VCAT") granted an application by the Law Institute of Victoria and decided that Mr Frugtniet was, for three years, a disqualified person under the Legal Profession Act 2004 (Vic) ("Victorian Legal Profession Act"). The basis for the decision was Mr Frugtniet's conduct at the Werribee Magistrates' Court, set out at [22] above. In August 2012, the Victorian Court of Appeal dismissed Mr Frugtniet's appeal against the decision except in respect of a finding by VCAT of contempt: Frugtniet v Law Institute of Victoria Ltd [2012] VSCA 178. 26 Mr Frugtniet stated that the VCAT proceedings were not disciplinary proceedings, and he emphasised that no contempt charges were sustained against him. Mr Frugtniet stated further that, at the time of his appearance at the Werribee Magistrates' Court, he was not a lay associate or intending to be one, and he had appeared on a once-only basis to help a group of families. He said that the proceedings in the Magistrates' Court were preliminary and nothing fundamental to the proceedings actually occurred, but he regretted his actions which were simply wrong. Mr Frugtniet said that at the time of becoming a disqualified person under the Victorian Legal Profession Act he was not a disqualified person for the purposes of his credit activities and was not required to notify ASIC. 27 As a result of Mr Frugtniet becoming a disqualified person under the Victorian Legal Profession Act, the Business Licensing Authority cancelled his statutory conveyancing licence and imposed conditions on the statutory conveyancing licence of UMS. These conditions included a prohibition on UMS allowing the involvement of Mr Frugtniet with UMS. Despite these prohibitions, it appeared that Mr Frugtniet continued to be involved with UMS as indicated by its website. He remained the sole director until 16 June 2011, the sole shareholder until 19 October 2011 and the company secretary until 12 January 2013. 28 Mr Frugtniet stated that the cancellation of his conveyancing licence was automatic as a consequence of disqualification under the Victorian Legal Profession Act and for no other reason. He stated that he had resigned as a director of UMS and that the conditions applied only to the conveyancing aspect of UMS (which trades as Mortgage Migration & Conveyancing Services). He did not accept that he had breached the terms of the disqualification. 29 In January 2013, the Tax Practitioners Board terminated Mr Frugtniet's registration as a tax agent and prohibited him from registering as a tax agent for five years on the basis that he was no longer a fit and proper person to be registered as a tax practitioner. Mr Frugtniet applied to the Tribunal for review and on 23 October 2014 the Tribunal affirmed the Tax Practitioners Board's decision: Frugtniet and Tax Practitioners Board [2014] AATA 766; (2014) 148 ALD 401 ("Frugtniet [2014] AATA 766"). Mr Frugtniet stated that he did not accept many of the Tribunal's findings and that he had lodged an appeal to the Federal Court on a question of law. 30 In November 2014, MARA cancelled Mr Frugtniet's registration as a migration agent following a complaint about the provision of false information to authorities and a finding that Mr Frugtniet was not a fit and proper person to be a registered migration agent. Under cross-examination Mr Frugtniet agreed that, during the proceeding before the Tribunal, he had not informed ASIC of MARA's decision, and had not referred to the decision at the time of preparing his statement of facts and contentions dated 20 October 2014 ("SoFC"). By way of explanation, Mr Frugtniet said no formal finding had been made at that time. He denied that his action contradicted his contention that he appeared to have been successful as a migration agent for 16 years without attracting detrimental attention. He said that he made no reference to the MARA decision in his response to ASIC's Statement of Facts, Issues and Contentions that he filed on 27 November 2014 because he was replying to ASIC's claims, although he maintained that he was intending to disclose the decision to ASIC at the hearing even though he did not consider that he had any obligation to do so. 31 The following factual finding, at para 49 of the Tribunal's decision record, was also not in dispute on the appeal: In his application for a stay of implementation of the current proceedings, Mr Frugtniet stated as one of the reasons for seeking a stay: ... Public protection paramount, hence, not a single complaint. He told the Tribunal that this statement was correct. Under cross-examination he agreed that there had, in fact, been a complaint about his activities as a credit facilitator, but stated that the Financial Services Ombudsman had not made a determination, so the matter could not be considered to be a complaint, as that word means a complaint that had been proved or sustained and not merely alleged.

Legal framework 32 Section 80(1)(f) of the NCCP Act provides that ASIC may make a banning order against a person if ASIC has reason to believe that the person is not a fit and proper person to engage in credit activities. Section 6 of the NCCP Act explains when a person engages in a credit activity, and covers topics such as credit contracts, consumer leases, mortgages and guarantees. 33 Section 80(2) provides, relevantly: (2) For the purposes of paragraphs (1)(e) and (f), ASIC must (subject to Part VIIC of the Crimes Act 1914) have regard to the following: (a) if the person is a natural person - the matters set out in paragraphs 37(2)(a) to (f) and subparagraph 37(2)(g)(i) in relation to the person; ... (c) any criminal conviction of the person, within 10 years before the banning order is proposed to be made; (d) any other matter ASIC considers relevant; (e) any other matter prescribed by the regulations. Note: Part VIIC of the Crimes Act 1914 includes provisions that, in certain circumstances, relieve persons from the requirement to disclose spent convictions and require persons aware of such convictions to disregard them. 34 Section 37 sets out circumstances in which ASIC is required to grant an Australian credit licence. Section 37(2) provides, relevantly: (2) For the purposes of paragraphs (1)(b) and (c), ASIC must (subject to Part VIIC of the Crimes Act 1914) have regard to the following: … (g) if the person is a single natural person: (i) whether the person has ever been disqualified from managing corporations under Part 2D.6 of the Corporations Act 2001; (ii) any criminal conviction of the person, within 10 years before the application was made; ... (i) any other matter ASIC considers relevant … 35 The expression "fit and proper person" is frequently used in legislation which regulates the conduct of activities which place consumers in a relationship of trust with a service provider. As the primary judge observed (at [45]): It is plain that many consumers to whom "credit activities" are provided would have serious financial exposure to dishonesty on the part of a licensee. In that sense, such consumers are vulnerable. The purpose of the licensing scheme is, inter alia, to ensure that "credit activities" are performed by persons who are fit and proper to perform them, in order that the exposure and vulnerability of consumers is lessened. That is also why there is an obligation on licensees to ensure that credit activities are engaged in "efficiently, honestly and fairly" (s 47(1) NCCP Act). 36 In Hughes & Vale Pty Ltd v New South Wales (No 2) [1955] HCA 28; (1955) 93 CLR 127 at 156, Dixon CJ, McTiernan and Webb JJ said: … The expression "fit and proper person" is of course familiar enough as traditional words when used with references to offices and perhaps vocations. But their very purpose is to give the widest scope for judgment and indeed for rejection. "Fit" (or "idoneus") with respect to an office is said to involve three things, honesty knowledge and ability: "honesty to execute it truly, without malice affection or partiality; knowledge to know what he ought duly to do; and ability as well in estate as in body, that he may intend and execute his office, when need is, diligently, and not for impotency or poverty neglect it" - Coke. 37 In Australian Broadcasting Tribunal v Bond [1990] HCA 33; (1990) 170 CLR 321, Toohey and Gaudron JJ said, at 380: The expression "fit and proper person", standing alone, carries no precise meaning. It takes its meaning from its context, from the activities in which the person is or will be engaged and the ends to be served by those activities. The concept of "fit and proper" cannot be entirely divorced from the conduct of the person who is or will be engaging in those activities. However, depending on the nature of the activities, the question may be whether improper conduct has occurred, whether it is likely to occur, whether it can be assumed that it will not occur, or whether the general community will have confidence that it will not occur. The list is not exhaustive but it does indicate that, in certain contexts, character (because it provides indication of likely future conduct) or reputation (because it provides indication of public perception as to likely future conduct) may be sufficient to ground a finding that a person is not fit and proper to undertake the activities in question. 38 ASIC's Regulatory Guide 204 entitled "Applying for and varying a credit licence" para RG204.177 provides that to be a fit and proper person to engage in credit activities means that the person: (a) is competent to operate a credit business (as demonstrated by the person's knowledge, skills and experience); (b) has the attributes of good character, diligence, honesty, integrity and judgment; (c) is not disqualified by law from performing their role in your [sic] credit business; and (d) either has no conflict of interest in performing their role in your [sic] credit business, or any conflict that exists will not create a material risk that the person will fail to properly perform their role in your [sic] credit business. 39 The primary judge concluded his reasons by making the following observations about honesty (at [191]): Honesty is a notion of broader compass than legality. The two are not coextensive. A person who baldly lies may not have acted in contravention of law. Nevertheless a person in the habit of baldly lying, especially one who sees nothing objectionable in that habit, is unlikely to be fit and proper to engage in activities involving trust and vulnerability. It follows that it is not necessarily an answer to an accusation of dishonesty to plead consistency with law, nor often will technical chicanery or linguistic artfulness improve the plea. It does not suffice for a person who has patently and deliberately misled another to point to the absence of legal obligation to excuse the misleading. I would like to think that it is an aspect of being a fit and proper repository of trust that one does the moral thing whether or not one is legally obliged to do so. 40 The primary judge clarified, at [192], that this passage was not intended to contain findings concerning Mr Frugtniet specifically. However, his Honour noted that it was substantially on the basis of satisfaction as to Mr Frugtniet's record of dishonesty (and not a record of contraventions of statutory obligations) that the Tribunal had reached its decision.

Tribunal's reasons 41 In summary (and subject to the matters raised by ground 1 of the appeal), in [1] to [35] of its decision record, the Tribunal set out the legal framework for its review and the background facts identified above, together with Mr Frugtniet's observations concerning those background facts. 42 Paragraphs 36 to 52 of the Tribunal's decision record are headed "Consideration". Mr Frugtniet's appeal raises issues concerning most of these paragraphs. Mr Frugtniet does not take issue with the following conclusions in this section of the Tribunal's decision record: (1) Mr Frugtniet conceded that, in 2004, he was unable to satisfy the Board of Examiners that he met the requirements for admission to legal practice and that he failed to make full disclosure under State legislation. Despite his claims that his failure was caused by his mindset at the time, this is an example of Mr Frugtniet's failure to make full disclosure of relevant matters when he knew or ought to have known that he was required to do so (para 42 of the Tribunal's decision record); (2) In respect of the 2010 false representation at the Werribee Magistrates' Court, Mr Frugtniet conceded that his actions were wrong. However, he sought to minimise his wrongdoing by claiming that he had a "brain snap"; that the proceedings were of a preliminary nature; and that he was helping a friend. He claimed to have misled by omission. This demonstrates that Mr Frugtniet has not gained an insight into the serious nature of his actions (para 45 of the Tribunal's decision record); (3) In respect of the 2011 cancellation of Mr Frugtniet's conveyancing licence, UMS was required to ensure that Mr Frugtniet had no involvement with the company. Despite Mr Frugtniet's evidence that the website listing his name as the contact person for UMS in the provision of credit facilities, including loans, had been dormant for some time, Mr Frugtniet appeared to have continued his involvement with UMS. This is demonstrated by the evidence that the website was in existence on 30 October 2014, which is after the date of the banning order, and shows either a complete disregard for the banning order or at least carelessness that had the potential to mislead the public about UMS and its provision of credit services (para 46 of the Tribunal's decision record). 43 At paras 50 and 51, the Tribunal concluded: [50] On all the material before the Tribunal there is no doubt that Mr Frugtniet has been the subject of multiple findings of dishonesty by courts, tribunals and other bodies. He has been told repeatedly that his conduct is unacceptable and that he needs to demonstrate that he has changed his behaviour before he can be considered to be a person of integrity, trustworthiness and good character. However in his evidence to the Tribunal Mr Frugtniet has continued to minimise the nature and seriousness [of] his past actions and his dishonest conduct. The Tribunal does not accept that he has shown genuine remorse for a lack of candour in the past. [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. 44 At para 52, the Tribunal found that Mr Frugtniet had not shown himself to possess the attributes of good character, diligence, honesty, integrity and judgment as set out in ASIC's Regulatory Guide 204 at para RG204.177. 45 Also at para 52, the Tribunal concluded that it was satisfied that, having regard to the relevant factors in s 80(2) and s 37(2) of the NCCP Act, it had reason to believe that Mr Frugtniet is not a fit and proper person to engage in credit activities.

Right of appeal on a question of law 46 As noted above, Mr Frugtniet's right of appeal under s 44 of the AAT Act was limited to a right of appeal "on a question of law". The primary judge explained the scope of the phrase "question of law" at [24] and [25] of his Honour's reasons. Mr Frugtniet did not contend that there was any error in this aspect of the primary judge's decision. In particular, at [24] the primary judge set out the following passage from the decision of a five-member bench of the Full Court of this Court in Haritos v Commissioner of Taxation [2015] FCAFC 92; (2015) 233 FCR 315, concerning the scope of the phrase "question of law" in s 44, at [62]: (1) The subject matter of the Court's jurisdiction under s 44 of the AAT Act is confined to a question or questions of law. The ambit of the appeal is confined to a question or questions of law. (2) The statement of the question of law with sufficient precision is a matter of great importance to the efficient and effective hearing and determination of appeals from the Tribunal. (3) The Court has jurisdiction to decide whether or not an appeal from the Tribunal is on a question of law. It also has power to grant a party leave to amend a notice of appeal from the Tribunal under s 44. (4) Any requirements of drafting precision concerning the form of the question of law do not go to the existence of the jurisdiction conferred on the Court by s 44(3) to hear and determine appeals instituted in the Court in accordance with s 44(1), but to the exercise of that jurisdiction. (5) In certain circumstances it may be preferable, as a matter of practice and procedure, to determine whether or not the appeal is on a question of law as part of the hearing of the appeal. (6) Whether or not the appeal is on a question of law is to be approached as a matter of substance rather than form. (7) A question of law within s 44 is not confined to jurisdictional error but extends to a non-jurisdictional question of law. (8) The expression "may appeal to the Federal Court of Australia, on a question of law, from any decision of the Tribunal" in s 44 should not be read as if the words "pure" or "only" qualified "question of law". Not all so-called "mixed questions of fact and law" stand outside an appeal on a question of law. (9) In certain circumstances, a new question of law may be raised on appeal to a Full Court. The exercise of the Court's discretion will be affected not only by Coulton v Holcombe [1986] HCA 33; (1986) 162 CLR 1 considerations, but also by considerations specific to the limited nature of the appeal from the Tribunal on a question of law, for example the consideration referred to by Gummow J in Federal Commissioner of Taxation v Raptis (1989) 20 ATR 1262 that there is difficulty in finding an "error of law" in the failure in the Tribunal to make a finding first urged in this Court. (10) Earlier decisions of this Court to the extent to which they hold contrary to these conclusions, especially to conclusions (3), (4), (6) and (8), should not be followed to that extent and are overruled. Those cases include Birdseye v Australian Securities and Investments Commission (2003) 38 AAR 55; Australian Securities and Investments Commission v Saxby Bridge Financial Planning Pty Ltd (2003) 133 FCR 290; [Comcare v Etheridge [2006] FCAFC 27; (2006) 149 FCR 522]; HBF Health Funds and Hussain v Minister for Foreign Affairs (2008) 169 FCR 241. 47 In Repatriation Commission v Hill [2002] FCAFC 192; (2002) 69 ALD 581 at [59], the Full Court comprising Black CJ, Drummond and Ryan JJ said: [A] decision cannot be the subject of an appeal under s 44(1) of the Administrative Appeals Tribunal Act 1975 ("AAT Act"), unless, in making it, the Tribunal has acted otherwise than in accordance with the law. If a tribunal falls into an error of law "which causes it to identify a wrong issue, to ask itself a wrong question, to ignore relevant material, to rely on irrelevant material or, at least in some circumstances, to make an erroneous finding or to reach a mistaken conclusion, and the tribunal's exercise or purported exercise of power is thereby affected, it exceeds its authority or powers": see Craig v State of South Australia (1995) 184 CLR 163 at 179. An error of law of this kind may support an appeal under s 44 of the AAT Act on a question of law: cf The Hospital Benefit Fund of Western Australia Inc v Minister for Health, Housing and Community Services (1992) 39 FCR 225 at 231-232 per Wilcox, Burchett and French JJ. 48 As explained by the Full Court in Collector of Customs v Pozzolanic Enterprises Pty Ltd [1993] FCA 456; (1993) 43 FCR 280 at 287, whose comments were subsequently adopted by the High Court in Minister for Immigration and Ethnic Affairs v Wu Shan Liang [1996] HCA 6; (1996) 185 CLR 259 at 272, the Court will not be concerned with looseness in the language of a tribunal nor with unhappy phrasing of a tribunal's thoughts. Further, the Court will not construe the reasons for the decision under review "minutely and finely with an eye keenly attuned to the perception of error".

Grounds of Appeal 49 Mr Frugtniet raised 11 grounds of appeal. At the hearing of the appeal on 2 May 2017, Mr Frugtniet applied orally to adduce an affidavit sworn by himself that day as evidence in the appeal. The affidavit annexes a ruling dated 23 February 1998, apparently in a trial of Mr Frugtniet on charges of perjury. The ruling includes a conclusion that the 1978 UK convictions are spent convictions under the Rehabilitation of Offenders Act 1974 (UK) and under Pt VII of the Crimes Act 1914 (Cth). The affidavit also annexes a police certificate from the Australian Federal Police dated 20 August 1996. While Mr Frugtniet's application was granted, during his oral submissions he did not appear to make any use of this evidence.

Ground 1: statement that Mr Frugtniet was required to notify ASIC of disqualified person status 50 Ground 1 concerns the Tribunal's statement at para 25 of its decision record that: At the time of becoming a disqualified person, Mr Frugtniet was required to notify [ASIC] of his status as a disqualified person in respect of his connection with the Australian credit licence held by UMS. 51 We will refer to this statement by the Tribunal as the "notification statement". 52 The statement relates to VCAT's April 2011 decision that Mr Frugtniet was a disqualified person under the Victorian Legal Profession Act, based on his misconduct at the Werribee Magistrates' Court in May 2010. 53 Before both the primary judge and this Court, Mr Frugtniet contended that the notification statement was a conclusion of law. The primary judge rejected that contention. 54 The primary judge's reasons concerning the notification statement are at [48] to [64] of his Honour's judgment. At [52], his Honour observed that, at para 26 of its decision record, the Tribunal recorded, relevantly: Mr Frugtniet said that at the time of becoming a disqualified person under the [Victorian Legal Profession Act] he was not a disqualified person for the purposes of his credit activities and was not required to notify [ASIC]. 55 The primary judge concluded that: (1) paragraphs 3 to 35 of the Tribunal's decision record set out facts and recorded submissions; (2) in those paragraphs, the Tribunal was not engaged in an exercise of reconciling disputed propositions of fact or law; (3) the findings of fact that entered into the Tribunal's deliberations are set out at paras 36 to 49 of the decision record; (4) paragraphs 25 and 26 record facts and submissions (concerning the events at Werribee Magistrates' Court and VCAT's subsequent decision); and (5) the facts and submissions recorded in paras 25 and 26 are addressed by findings made in para 45 where the Tribunal concluded: In respect of the false representation at the Werribee Magistrates' Court, Mr Frugtniet conceded that his actions were wrong. However he sought to minimise his wrongdoing by claiming that he had a brain snap; the proceedings were of a preliminary nature; and he was helping a friend. He claimed to have misled by omission. This demonstrates yet again that Mr Frugtniet has not gained an insight into the serious nature of his actions. 56 At [55] and [56] of his Honour's reasons, the primary judge noted that the Tribunal did not refer to the notification statement at para 45 of the decision record, or at paras 50 to 52 of the decision record where the Tribunal concluded that it had reason to believe that Mr Frugtniet is not a fit and proper person to engage in credit activities, or anywhere in paras 36 to 49 of the Tribunal's decision record. At [56], the primary judge stated that the absence of reference in paras 36 to 49 to any obligation of disclosure to ASIC of the VCAT decision led him to conclude that it was not a matter upon which the Tribunal relied in making its decision. 57 In reaching that conclusion, the primary judge rejected Mr Frugtniet's submission that, when the Tribunal commenced its conclusions (at para 51 of the decision record) with the words: "On all the material before the Tribunal", it was relying on the notification statement as a finding. 58 At [57] and following, the primary judge considered the significance of the fact that the notification statement reads like a conclusion of law. Against that interpretation the primary judge noted that, if it were a conclusion of law, it would be unique in the context of paras 3 to 35 of the Tribunal's decision record. His Honour also noted that, in context, the statement must be understood as a contested statement because of the submission made by Mr Frugtniet and recorded in the immediately following paragraph (set out at [54] above). 59 At [58], the primary judge concluded that the notification statement recorded "with respect somewhat unclearly" a submission made by Mr Frugtniet to VCAT which was in evidence before the Tribunal. In that submission, Mr Frugtniet had argued that a consequence of a disqualification order would be that he would be required to notify ASIC which may, in turn, make a banning order against him. At [59], the primary judge recorded that Mr Frugtniet was cross-examined before the Tribunal about whether he believed that he was required to notify ASIC that he was a disqualified person. At [61], the primary judge concluded that the notification statement should have read: "Mr Frugtniet thought at the time that he was required to notify [ASIC of his status as a disqualified person …]" and that this is really what the Tribunal intended. 60 Accordingly, at [62], the primary judge concluded that: (1) the notification statement was not in fact expressing a conclusion of law, erroneous or otherwise and accordingly it can betray no error of law; and (2) the Tribunal did not have regard to any failure by Mr Frugtniet to comply with any requirement to advise ASIC of his disqualification. Accordingly, any error of law was immaterial. 61 Ground 1 contends that, in the reasons described above, the primary judge erred by "failing to find that the Tribunal misunderstood its statutory task and fell into error of a jurisdictional kind capable of corresponding to the Court's exercise of jurisdiction under s 44" of the AAT Act. 62 In our view, the primary judge's reasons involve no error. We respectfully agree with his Honour's interpretation of the Tribunal's reasons. Contrary to Mr Frugtniet's submissions, it was a necessary part of the primary judge's task to decide what the Tribunal meant by its reasons: it was not impermissible for his Honour to reason from the whole of the reasons and the evidence, including the cross-examination of Mr Frugtniet, to the conclusion that the notification statement was intended to describe Mr Frugtniet's belief as articulated by him to VCAT. 63 We reject Mr Frugtniet's submission that the notification statement expressed a conclusion of law: it formed part of the Tribunal's account of the facts and submissions, which included the contrary proposition as put by Mr Frugtniet in the following paragraph (para 26 of the Tribunal's decision record). Contrary to Mr Frugtniet's submissions, the primary judge did not proceed on the basis that the notification statement was part of a recital of evidence: as his Honour recognised (at [54]), it formed part of an account of facts and submissions. 64 The reference to "all the material before the Tribunal" must be understood to include Mr Frugtniet's submission that he was not required to notify ASIC, where the conflict between that submission and the notification statement was not resolved. Accordingly, it does not include the notification statement in the absence of that other material. 65 Ground 1 must therefore fail. Consequently, it is unnecessary to consider ground 1 of the notice of contention.

Ground 1A: false credit licence application 66 Ground 1A concerns the November 2010 lodgement by UMS of an Australian credit licence application. At para 44 of the Tribunal's decision record, the Tribunal found relevantly that "when completing the credit licence application on behalf of UMS in November 2010 Mr Frugtniet provided answers that were false or misleading by not revealing all his relevant history". 67 Ground 1A is that the Tribunal erred by "misconstruing the NCCP Act in concluding that the application for a credit licence was false pursuant to s 80(1)(f) although not enlivened as no consideration of s 80(1)(d) was undertaken". 68 Mr Frugtniet contends that the Tribunal erred by failing to address how the application may have contravened credit legislation "or being involved in the contravention of credit legislation of another person." 69 Ground 1A was not ventilated before the primary judge. In Francuziak v Minister for Justice [2015] FCAFC 162; (2015) 238 FCR 332 at [11], a Full Court of this Court said that leave to rely on an argument not previously relied on will generally be granted only where it is expedient in the interests of justice to do so. See also Sun v Minister for Immigration and Border Protection [2016] FCAFC 52; (2016) 243 FCR 220 at [90] (Flick and Rangiah JJ). 70 In this case, leave to amend the notice of appeal to rely on ground 1A should be refused because the ground lacks merit. The Tribunal's finding was relevant to the question of Mr Frugtniet's fitness and propriety, regardless of whether the 2010 credit licence application on behalf of UMS involved any contravention of credit legislation. Ground 1A appears to perpetuate a misconception on Mr Frugtniet's part that it is necessary for there to be legal wrongdoing (and, in particular, a contravention of credit legislation) in order for his conduct to be inconsistent with propriety. The primary judge attempted to address that misconception in the passage set out at [39] above.

Grounds 2 and 4: spent convictions 71 These grounds concern Mr Frugtniet's contention that the Tribunal impermissibly relied upon "spent convictions" in making its decision. 72 Ground 2 concerns the Tribunal's finding (at para 38 of its decision record) that Mr Frugtniet's 1978 UK convictions (referred to at [7] above) were relevant evidence of dishonest conduct under ASIC's policy guidelines. Ground 4 concerns the finding, referred to at [9] above, that Mr Frugtniet was guilty of obtaining property by deception in 1997. 73 At para 40 of its decision record, the Tribunal found that the 1997 finding of guilt was a "further example of dishonest conduct that is relevant to the Tribunal's proceedings". 74 Ground 2 is expressed in the following terms: The primary Judge erred by failing to find that the Tribunal misconstrued the statutory context of s 80(2)(c) of [the NCCP Act] which provided for a conviction within the last 10 years expressly stated so that s 80(2)(c) was not limited by s 80(2)(d) in that "any other relevant matter", was other than those listed in sub-sections, which was circumscribed by consideration of spent convictions pursuant to Div 3 of Pt VIIC of the Crimes Act - ss 85ZV and 85ZW so that Div 6 of Pt VIIC, Section 85ZZH could not exclude it given that the Tribunal performs a review function pursuant to the enabling enactment relevantly ("the NCCP Act"), so that the specific issue in Toohey v Tax Agents' Board of Victoria (2007) 171 FCR 291 was determined wrongly and should not have been followed. 75 Ground 4 is relevantly identical to ground 2. 76 At [68] of his Honour's reasons, the primary judge referred to his earlier rejection of the submission that, because s 80(2)(c) deals expressly with certain convictions, all other conviction-related matters are impermissible considerations. In the primary judge's view, where the Tribunal formed the view that historical convictions were "evidence of dishonest conduct", the Tribunal was prima facie authorised to take them into account by s 80(2)(d). 77 From [70], the primary judge considered the effect of Pt VIIC of the Crimes Act. Part VIIC is entitled "Pardons, quashed convictions and spent convictions". Division 3 of Pt VIIC is entitled "Spent convictions". At [72], his Honour assumed that the offences for which Mr Frugtniet was sentenced were "spent convictions" within the meaning of s 85ZM of the Crimes Act. His Honour referred to ss 85ZV(2)(b) and 85ZW(b) which have the effect that, subject to Div 6, there is no requirement to disclose a spent conviction and a spent conviction is a matter that may not be taken into account. 78 At [73], the primary judge set out s 85ZZH (in Div 6 of Pt VIIC), which provided relevantly: Division 3 does not apply in relation to the disclosure of information to or by, or the taking into account of information by a person or body referred to in one of the following paragraphs for the purpose specified in relation to the person or body: ... (c) a court or tribunal established under a Commonwealth law, a State law or a Territory law, for the purpose of making a decision, including a decision in relation to sentencing … 79 At [74], the primary judge recorded his concern with ASIC's interpretation of s 85ZZH, to the effect that the Tribunal could take into account "spent convictions", even though ASIC itself would be precluded from doing so. However, at [75], his Honour recorded his view that the plain words of s 85ZZH(c) tended to support ASIC's interpretation. His Honour also cited the following conclusion of Middleton J in Toohey v Tax Agents Board of Victoria (2007) [2007] FCA 431; (2007) 171 FCR 291 ("Toohey") at [30]: The operation of those 2 provisions under Div 3 of Pt VIIC of the Crimes Act - ss 85ZV and 85ZW - are, in express terms, made subject to Div 6 of Pt VIIC. Section 85ZZH relevantly says that Div 3 does not apply in relation to the taking into account of information by a tribunal established under a Commonwealth law for the purposes of making a decision. In my view, that provision is of general import, and does not just apply where a tribunal is making a determination specifically referred to it in relation to a conviction, or where it is otherwise bound to take into account a conviction. 80 At [76], the primary judge concluded that Middleton J's decision was directly on point and should therefore be followed, unless his Honour formed the view that it is plainly wrong. Not finding that Middleton J was plainly wrong, the primary judge found that the Tribunal was not precluded by Pt VIIC of the Crimes Act from taking into account the 1978 UK convictions. 81 Concerning ground 4, at [100], the primary judge noted that a finding of guilt without a recording of a conviction is a "conviction" for the purposes of Pt VIIC of the Crimes Act, by s 85ZM(1)(b). His Honour accepted that ASIC would have been precluded from taking into account the 1997 finding of guilt, by the operation of ss 85ZV and 85ZW, but that the Tribunal was not so precluded, applying Toohey.

Mr Frugtniet's submissions 82 In his written submissions in support of ground 2, Mr Frugtniet submitted that: (1) The convictions were spent both under the Rehabilitation Act 1974 (UK) and the Crimes Act. (2) As a matter of construction of s 80, spent convictions are not relevant except in criminal proceedings where propensity evidence may be used. In comparable legislation affecting registration of migration agents (s 290 of the Migration Act 1958 (Cth)), spent convictions are not within the scope of "any other matter relevant to the applicant's fitness to give immigration assistance". (3) The policies referenced by the Tribunal did not empower consideration of spent convictions. From his written submissions in reply, this submission apparently refers to ASIC's Regulatory Guide 204, mentioned earlier. Specifically, paras RG204.288-294 address criminal history checks. RG204.288 states: You are not obliged to disclose convictions to us that are 'spent' or 'quashed': see the definition of 'spent conviction' in Pt VIIC of the Crimes Act 1914. You must ensure that the national criminal history checks you apply for do not disclose details of spent convictions. We may not accept national criminal history checks that have been conducted for other purposes, such as applications for a firearms licence, because those checks may include details of spent convictions. (4) The decision in Toohey was not binding on the primary judge and was wrongly decided. To this end, Mr Frugtniet points to an order made by Tracey J in the matter of Zahidul Haque v Migration Agents Registration Authority & Anor, which was proceeding number VID257/2014 in this Court. The order document contained the note: The Tribunal decision dated 17 April 2014 is affected by an error of law as the Tribunal erroneously found that the applicant's conviction on 9 March 2004 was not a conviction that is spent under Part VIIC of the Crimes Act 1914 (Cth) contrary to Section 290(2)(c) of the Migration Act 1958 (Cth). Reasons were not published for the making of the order. 83 Mr Frugtniet also submitted that the International Covenant on Economic, Social and Cultural Rights, International Covenant on Civil and Political Rights and the Convention on the Rights of the Child each prohibit discrimination against any person on the ground of "other status". He noted that the European Court of Human Rights has interpreted non-discrimination on the grounds of "other status" to include non-discrimination on the basis of criminal record, but did not explain how these matters affect the issues on the appeal. International Conventions to which Australia is a party do not form part of its domestic law unless and until given effect by statute, although they can supply content to a rule of construction that statutes are to be interpreted and applied, as far as their language permits, so as not to be inconsistent with the comity of nations or with established rules of international law: Brown v Members of the Classification Review Board of the Office of Film & Literature Classification [1998] FCA 319; (1998) 82 FCR 225 at 236. In his submissions in reply Mr Frugtniet contended, in effect, that the right not to have spent convictions taken into account was in the nature of a fundamental right. This submission seemed to misunderstand the effect of the observations of Gleeson CJ in Al-Kateb v Godwin [2004] HCA 37; (2004) 219 CLR 562, which were concerned with fundamental common law rights (in contrast to the statutory rights created by spent convictions legislation) and the improbability that Parliament would abrogate fundamental rights by the use of general or ambiguous words. 84 Mr Frugtniet's submissions in support of ground 4 did not raise any additional matters. 85 In his submissions in reply, Mr Frugtniet relied upon the Australian Law Reform Commission ("ALRC") Report No 37 "Spent Convictions". Relevantly, the report says (at para 39): The reasons for a general obligation to disregard spent convictions have less force when the decision maker is a court or tribunal. Courts and tribunals apply a well defined and highly structured set of rules in admitting evidence of convictions and determining the weight to be given to the evidence. And (at para 40): Given the safeguard already imposed by the laws of evidence, there is no need for courts or tribunals, when applying the laws of evidence, to be further restricted by the obligation to disregard spent convictions. The latter sentence contains a footnote which states: This recommendation should not extend to cases where the court or tribunal is not applying the laws of evidence. 86 A "Spent Convictions Bill 1987" is annexed to the report as well as a draft explanatory memorandum. These documents are drafted in accordance with the recommendations of the ALRC.

Consideration 87 The primary judge's reasoning proceeded upon the assumption that the 1978 UK convictions were spent convictions. That was an appropriate assumption, in Mr Frugtniet's favour. His Honour applied his reasoning in relation to the 1978 UK convictions to the 1997 finding of guilt, thereby implicitly assuming that it was also a spent conviction. 88 In our view, the primary judge's interpretation of s 80 of the NCCP Act (aside from the effect of Pt VIIC of the Crimes Act) was correct for the reasons given by his Honour. For the purposes of deciding whether there is reason to believe that a person is not a fit and proper person to engage in credit activities within the meaning of s 80(1)(e), s 80(2)(c) requires the decision-maker to have regard to any criminal conviction within 10 years before the banning order is made. Subject to consideration of the operation of Pt VIIC of the Crimes Act (and specifically Div 3 of Pt VIIC), that requirement does not imply a duty to disregard criminal convictions that do not fall within the scope of s 80(2)(c) of the NCCP Act, particularly having regard to the requirement, in s 80(2)(d), that the decision-maker have regard to any other matter considered relevant. 89 As to Pt VIIC of the Crimes Act, the relevant question, as the primary judge correctly identified, is whether s 85ZZH(c) of the Crimes Act operated to preclude the Tribunal from taking into account the 1978 UK convictions (or the 1997 finding of guilt). In the light of his Honour's assumption that those matters were spent convictions, there is no doubt that ASIC was precluded by Div 3 of Pt VIIC from taking those matters into account. That statutory inhibition was supported by paras RG204.288-294 of ASIC's Regulatory Guide 204. 90 In full, s 85ZZH provides: Division 3 does not apply in relation to the disclosure of information to or by, or the taking into account of information by a person or body referred to in one of the following paragraphs for the purpose specified in relation to the person or body: (a) a law enforcement agency, for the purpose of making decisions in relation to prosecution or sentencing or of assessing: (i) prospective employees or prospective members of the agency; or (ii) persons proposed to be engaged as consultants to, or to perform services for, the agency or a member of the agency; (b) an intelligence or security agency, for the purpose of assessing: (i) prospective employees or prospective members of the agency; or (ii) persons proposed to be engaged as consultants to, or to perform services for, the agency or a member of the agency; (c) a court or tribunal established under a Commonwealth law, a State law or a Territory law, for the purpose of making a decision, including a decision in relation to sentencing; (d) a person who makes a decision under the Migration Act 1958, the Australian Citizenship Act 2007, or the Immigration Act 1980 of the Territory of Norfolk Island, for the purpose of making that decision; (g) a Commonwealth authority, for the purpose of assessing appointees or prospective appointees to a designated position; (h) AUSTRAC, for the purpose of assessing: (i) prospective members of the staff of AUSTRAC; or (ii) persons proposed to be engaged as consultants under subsection 225(1) of the Anti-Money Laundering and Counter-Terrorism Financing Act 2006; or (iii) persons whose services are proposed to be made available to AUSTRAC under subsection 225(3) of that Act; (j) the Australian Government Solicitor, for the purpose of instituting or conducting proceedings for Commonwealth offences; (k) a prescribed person or body, for a prescribed purpose, in relation to a conviction for a prescribed offence. 91 Regulation 8 of the Crimes Regulations 1990 (Cth) prescribes specified persons and bodies for the purposes of s 85ZZH(k). ASIC is a prescribed person for the following prescribed purposes for all offences: (1) considering whether to prosecute and making submissions as to sentence; (2) assessing the suitability of a person to be: (a) a member of ASIC: or (b) employed by ASIC; or (c) engaged as a consultant to ASIC; or (d) engaged to perform services for ASIC. 92 At [76] of his Honour's reasons, the primary judge concluded that the holding in Toohey was directly on point. This conclusion was not challenged by Mr Frugtniet: as appears from the language of ground 2, set out at [74] above, Mr Frugtniet's argument was that Toohey was determined wrongly and should not have been followed. In Toohey, the ultimate issue was whether Mr Toohey was a fit and proper person to prepare income tax returns and transact business on behalf of taxpayers in income tax matters. Section 251BC of the Income Tax Assessment Act 1936 (Cth) permitted the Board, in assessing a person's fitness, to disregard a conviction in certain circumstances. Middleton J concluded (at [24]) that the Tribunal had failed to address the ultimate issue for consideration and thereby made an error of law. 93 At [30], set out in full in the primary judge's reasons and at [79] above, Middleton J rejected Mr Toohey's submission that ss 85ZV and 85ZW of the Crimes Act (in Div 3 of Pt VIIC) applied to the Tribunal's consideration. In our view, the primary judge was correct to conclude that he should follow Middleton J's construction of s 85ZZH unless of the view that it was "plainly wrong". The correctness of the approach was explained by French J (as he then was) in Hicks v Minister for Immigration & Multicultural & Indigenous Affairs [2003] FCA 757 as follows (at [75]-[76]): [75] It is well established that a judge of this Court should follow an earlier decision of another judge unless of the view that it is plainly wrong - Takapana Investments Pty Ltd v Teco Information Systems Co Ltd (1998) 82 FCR 25 at 33 (Goldberg J), citing Towney v Minister for Land and Water Conservation for New South Wales (1997) 147 ALR 402 at 412 and Esso Australia Resources Ltd v Commissioner of Taxation (Cth) (1997) 150 ALR 117 at 121. See also La Macchia v Minister for Primary Industries and Energy (1992) 110 ALR 201 at 204 where Burchett J said: 'The doctrine of stare decisis does not, of course, compel the conclusion that a judge must always follow a decision of another judge of the same court. Even a decision of a single justice of the High Court exercising original jurisdiction, while "deserving of the closest and respectful consideration", does not make that demand upon a judge of this court: Businessworld Computers Pty Ltd v Australian Telecommunications Commission (1988) 82 ALR 499 at 504. But the practice in England, and I think also in Australia, is that "a judge of first instance will as a matter of judicial comity usually follow the decision of another judge of first instance [scil of coordinate jurisdiction] unless he is convinced that the judgment was wrong": Halsbury, 4th ed, vol 26, para 580. The word "usually" indicates that the approach required is a flexible one, and the authorities illustrate that its application may be influenced, either towards or away from an acceptance of the earlier decision, by circumstances so various as to be difficult to comprehend within a single concise formulation of principle...' [76] The injunction to judicial comity does not merely advance mutual politeness as between judges of the same or co-ordinate jurisdictions. It tends also to uphold the authority of the courts and confidence in the law by the value it places upon consistency in judicial decision-making and mutual respect between judges. And where questions of law, and statutory construction, are concerned the proposition that a judge who has taken one view of the law or a statute is `clearly wrong' is one not lightly to be advanced having regard to the choices that so often confront the courts particularly in the area of statutory construction. 94 The primary judge was not of the view that the decision was "plainly wrong". 95 In considering Mr Frugtniet's submission about the comparability of s 290 of the Migration Act, it is relevant to note s 85ZZH(d), by which Div 3 does not apply to a person who makes a decision under the Migration Act. Section 290(2)(c) provides that, in considering whether it is satisfied that an applicant for registration as a migration agent is not fit and proper or not a person of integrity, MARA must take into account: (c) any conviction of the applicant of a criminal offence relevant to the question whether the applicant is not: (i) a fit and proper person to give immigration assistance; or (ii) a person of integrity; (except a conviction that is spent under Part VIIC of the Crimes Act 1914); … (h) any other matter relevant to the applicant's fitness to give immigration assistance. 96 Section 279 of the Migration Act further provides: (1) Despite paragraph 85ZZH(d) of the Crimes Act 1914, Part VIIC of that Act applies to this Part. (2) Division 3 of Part VIIC of the Crimes Act 1914 applies in relation to the Migration Agents Registration Authority as if it were a Commonwealth authority for the purposes of that Division. 97 In s 279(1), "this Part" is Pt 3 of the Migration Act, entitled "Migration agents and immigration assistance". 98 In s 513(2) of the Fair Work Act 2009 (Cth), the Parliament has also expressly provided that Div 3 of Pt VIIC applies to the disclosure of information to or by, or the taking into account of information by, the Fair Work Commission for the purpose of making certain decisions, despite para s 85ZZH(c). 99 These provisions tend to suggest that s 85ZZH(c) of the Crimes Act should be read according to its terms, in the absence of a provision applying Div 3 of Pt VIIC of the Crimes Act to the review of the banning order by the Tribunal despite s 85ZZH(c). The ordinary and natural meaning of s 85ZZH extends to apply it to the tribunal engaged in merits review: cf Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue [2009] HCA 41; (2009) 239 CLR 27 at [47]. 100 As to the provisions of ASIC's Regulatory Guide 204 concerning spent convictions, while the Tribunal is entitled to take account of any relevant government policy, it was not entitled to abdicate its function of determining whether, on the material before it, the banning order was the correct or preferable decision: Drake v Minister for Immigration and Ethnic Affairs (1979) 24 ALR 577 ("Drake") at 590. Accordingly, the policy could not operate so as a fetter on the Tribunal's obligation to take into account any matter that it considered relevant in accordance with s 80(2)(d) of the NCCP Act. 101 Mr Frugtniet's submissions concerning the relevance of the ALRC Report were based on s 15AB of the Acts Interpretation Act 1901 (Cth). Section 15AB provides relevantly: (1) Subject to subsection (3), in the interpretation of a provision of an Act, if any material not forming part of the Act is capable of assisting in the ascertainment of the meaning of the provision, consideration may be given to that material: (a) to confirm that the meaning of the provision is the ordinary meaning conveyed by the text of the provision taking into account its context in the Act and the purpose or object underlying the Act; or (b) to determine the meaning of the provision when: (i) the provision is ambiguous or obscure; or (ii) the ordinary meaning conveyed by the text of the provision taking into account its context in the Act and the purpose or object underlying the Act leads to a result that is manifestly absurd or is unreasonable. (2) Without limiting the generality of subsection (1), the material that may be considered in accordance with that subsection in the interpretation of a provision of an Act includes: (a) … (b) any relevant report of a Royal Commission, Law Reform Commission, committee of inquiry or other similar body that was laid before either House of the Parliament before the time when the provision was enacted; … 102 As introduced into the Crimes Act by the Crimes Legislation Amendment Act 1989 (Cth), Pt VIIC was substantially different from the Bill annexed to the ALRC report, as is the Explanatory Memorandum for the Crimes Legislation Amendment Act. In particular, as introduced, Pt VIIC did not include the express provision that the exemption for courts and tribunals would only apply where the laws of evidence were being applied. The Explanatory Memorandum does not address the position of tribunals not bound by the rules of evidence, saying only: [65] Proposed Section 85ZZH provides that the prohibitions on disclosure of, and taking into account spent convictions do not apply in particular circumstances to particular persons or bodies. As well as these statutory exemptions the Privacy Commissioner may examine requests for exemption and advise the Minister on whether an exemption should be granted and prescribed in Regulations. 103 Accordingly, we do not consider that the ALRC material is capable of assisting in the ascertainment of the meaning of s 85ZZH.

Kocic 104 Although not referred to before the primary judge or on the appeal, there is appellate consideration of a similar provision in the Criminal Records Act 1991 (NSW) in Kocic v Commissioner of Police, NSW Police Force [2014] NSWCA 368; (2014) 88 NSWLR 159. 105 Without considering the broader context of the Criminal Records Act, s 16(1) of that Act appears similar to s 85ZZH. The two pieces of legislation do not form part of a scheme of uniform national legislation and, accordingly, this is not a situation where the Court should follow the approach taken in Kocic unless convinced that the interpretation is plainly wrong: cf. Farah Constructions Pty Ltd v Say-Dee Pty Ltd [2007] HCA 22; (2007) 230 CLR 89 at [135]; Australian Securities Commission v Marlborough Gold Mines Ltd [1993] HCA 15; (1993) 177 CLR 485 at 492. However, it is instructive to consider the Court of Appeal's reasoning. 106 At [66], Basten JA (Leeming JA agreeing) explained the underlying premise of the Criminal Records Act as follows: The underlying premise of the Criminal Records Act is that reliance on old convictions for minor offences is more likely to give effect to prejudice than to provide a useful assessment of a person's current character or future behaviour. The exception provided with respect to court proceedings and decisions no doubt reflects the view that judges and magistrates will not act on prejudice or give undue weight to material which is of little relevance. 107 Basten JA referred to the possibility of anomalous results, where the tribunal standing in the shoes of an administrative decision-maker is entitled to have regard to spent convictions, whereas the original decision-maker was not. At [67], his Honour noted that if, "contrary to the assumption underlying the legislation, the spent convictions were material to the outcome of the application, arguably the applicant should have succeeded before the Commissioner but may not be able to succeed before the Tribunal on appeal". 108 At [68], Basten JA concluded that the answer to the apparent anomaly must turn on the powers of the tribunal, not the operation of s 16. His Honour referred to s 63(1) of the Administrative Decisions Tribunal Act 1997 (NSW) ("ADT Act"), which provides that, in determining an application for a review of a reviewable decision, the tribunal is to decide what the correct and preferable decision is having regard to the material then before it. His Honour considered that s 63(2) identified the nature of the tribunal's function by providing that, for the purpose of determining an application, "the Tribunal may exercise all of the functions that are conferred or imposed by any relevant enactment on the administrator who made the decision. 109 At [76], Basten JA concluded that the proper construction of s 16 is to recognise that the exception extends to tribunals generally, but not to the tribunal exercising merits review of an administrative decision-maker who is bound by the Criminal Records Act. His Honour's conclusion was based on the following reasons: [73] It is not entirely anomalous for an applicant to complain of legal error on the part of the decision-maker, but to see that error corrected on a merits review without the applicant improving his or her position. (That may occur where there has been a breach of procedural fairness at first instance.) However, it is counter-intuitive that an applicant must necessarily be in a more disadvantageous position in the case of spent convictions on review, than before the original decision-maker. There is certainly no incentive for the Commissioner not to rely on spent convictions where, if a refusal to issue a licence is challenged, the Tribunal will validly take precisely the same material into account. [74] On the other hand, if courts (including tribunals) are generally to be trusted to give only such weight as is deserved to spent convictions, the anomaly is diminished. Especially is that so if spent convictions are inherently of little weight. [75] One way of looking at the matter is to treat the functions of the Tribunal as limited to those of the original decision-maker (in this case the Commissioner) and to be exercised according to the same legal principles. On that approach, the operation of the Criminal Records Act is not to be characterised as procedural or evidentiary in effect, but as setting the legal parameters for the Commissioner's powers in dealing with an application for a firearm licence. [76] On that approach, s 16 would be seen to change the ground rules, as it were by a side-wind, without any clear intention that it should have such an operation. Indeed, if that operation had been intended, it might have been expected that it would be adverted to, possibly in s 75 of the Firearms Act, conferring jurisdiction on the Tribunal. That was not done. 110 White JA dissented on this point. At [128], his Honour noted that, by s 63(1) of the ADT Act, the tribunal was required to make the correct and preferable decision having regard to the material before it. The question before the tribunal was not whether the Commissioner made the correct decision on the material before him: cf Drake at 589. White JA considered that s 16 permitted the tribunal to have recourse to a wider range of materials than was before the Commissioner and must apply according to its terms, in the absence of some implied qualification according to the function being exercised by the tribunal. 111 At [132], White JA said: No different function is imposed on the Tribunal. The Tribunal is required to have regard only to those considerations which would be relevant to the Commissioner's decision. But because of s 16 of the Criminal Records Act the Tribunal is entitled to have regard to more materials than are available to the Commissioner in deciding whether it should be satisfied that the applicant is a fit and proper person who can be trusted to have possession of firearms without danger to public safety or to the peace. 112 At [136], White JA rejected the contention that to apply s 16 in accordance with its terms would fundamentally subvert the protections provided by the Criminal Records Act. At [138], in response to [73] of Basten JA's reasons (set out above), White JA said: In my respectful view, the question is one of Parliament's intention. Parliament's intention was that courts, and tribunals, could be trusted to give only such weight to spent convictions as was appropriate. For this reason there is no anomaly if the Tribunal can have regard to materials to which the Commissioner cannot have regard. 113 As to the question of whether there was no incentive for the Commissioner not to rely on spent commissions, his Honour said (at [139]): With respect, that observation suggests that the Commissioner, although not permitted to rely on a spent conviction for the purposes of s 11(3)(a) might nonetheless do so and refuse a licence because he knows that the Tribunal can take the same material into account. That implies that the Commissioner will disregard the limitations placed on him by s 12 of the Criminal Records Act in making his decision. Whilst that is a theoretical possibility, I see no reason to assume that the Commissioner would act otherwise than as required by law. More relevantly, I see no basis to assume that in enacting s 16 Parliament might have assumed that the original decision-maker might disregard the constraints imposed on him or her if an appeal lay to a tribunal to make a decision afresh where that tribunal was not subject to the same constraints. 114 Accordingly, at [140], White JA did not accept that s 12 "sets the 'legal parameters' for the Commissioner's power in dealing with an application for a firearms licence, if that expression refers to more than the materials to which regard may be had". 115 His Honour then considered whether there is an implied limitation in the Criminal Records Act to the kind of matters before a tribunal to which s 16 applies. His Honour concluded (at [141]-[142]: [141] … There is nothing in the Criminal Records Act itself that suggests that s 16 is limited to tribunals who are not conducting a merits review of a decision made by an administrative decision-maker who is bound by the Criminal Records Act. Unless a tribunal were confined to using the same materials as the decision-maker, there is no reason to imply such a limitation. If a tribunal is so confined, the limitation will be imposed by the law governing the tribunal's powers. [142] For these reasons I consider that notwithstanding the Commissioner cannot have regard to the spent convictions, nor to the conduct underlying the spent convictions, when deciding if he is satisfied that an applicant for a firearms licence is a fit and proper person who can be trusted to have possession of firearms without danger to public safety or to the peace (s 11(3)(a)), the Tribunal is not subject to that restraint. 116 In our respectful view, the reasoning of White JA is persuasive. Section 43(1) of the AAT Act, read in conjunction with s 25(4A) and Drake, prescribes the task of the Administrative Appeals Tribunal to be essentially the same as the task imposed on the Administrative Decisions Tribunal by s 63(1) of the ADT Act. The principle stated by Bowen CJ and Deane J in Drake is that the question for the determination of the Tribunal is not whether the decision which the decision-maker made was the correct or preferable one on the material before him. The question for the determination of the Tribunal is whether that decision was the correct or preferable one on the material before the Tribunal. That principle was applied by the High Court of Australia in relation to the review of a decision by the Tribunal concerning fitness and propriety in Shi v Migration Agents Registration Authority [2008] HCA 31; (2008) 235 CLR 286 ("Shi"). Shi makes it clear that, depending on the decision under review, the Tribunal may have regard to material that was not before the original decision-maker: in Shi, that comprised material relevant to the fitness and propriety of Mr Shi at the time of the relevant tribunal's decision. 117 Further, in the light of s 290 of the Migration Act and s 513(2) of the Fair Work Act, it seems unlikely that s 85ZZH(c) was not intended to have its literal effect in relation to tribunals engaged in merits review. 118 In our view, the reasoning of White JA fortifies the conclusion that the primary judge did not make any error in concluding that the Tribunal was entitled to take into account the 1978 UK convictions and the 1997 finding of guilt. 119 Accordingly, grounds 2 and 4 fail. As for ground 1, it is therefore unnecessary to consider grounds 2 and 3 of the notice of contention.

Ground 3: breach of travel agent's licence condition 120 The relevant passage of the Tribunal's decision is para 39, set out at [80] of the primary judge's reasons, is as follows: In respect of the matter involving Tarson Pty Ltd the Tribunal does not accept Mr Frugtniet's assertion that as he did not breach the terms of its licence it was the company, not him, that was at fault. Mr Frugtniet conceded in evidence that it was his own behaviour that caused the breach, and this is an example of dishonest conduct for which Mr Frugtniet has not accepted responsibility. 121 The passage concerns the 1995 incident, mentioned at [8] above, when the Victorian AAT found that Mr Frugtniet had been involved in the conduct of Tarson, a travel agency, in breach of a special condition imposed on the agency that excluded Mr Frugtniet from any involvement in the business. The decision of the Victorian AAT, Frugtniet trading as Karina Travel Int v Travel Agents Licensing Authority [1995] VICCAT 39, concerned a decision by the Travel Agents Licensing Authority to cancel the licence of Mrs Frugtniet, the wife of Mr Frugtniet. The Director of Consumer Affairs had raised objections to Mrs Frugtniet's continuing to hold a statutory licence, including that she was not a fit and proper person to continue to hold the licence by reason of her alleged failure as a director of Tarson to ensure compliance with the special condition. 122 Ground 3 states: The primary Judge erred by failing to find that the Tribunal misdirected itself as to the statutory context of s 80(2) in that it did not provide for an irrelevant consideration to be taken into account under s 80(2)(d) any other matter it considers relevant, as that would not encompass matters where the Appellant was not even a party to such proceedings, could therefore not appeal the matter, and which was fairly put to the Tribunal, if in the alternative it be found that it could consider such matters that by giving it the excessive weight that it did it drew upon facts that were quite unreasonable and was procedurally unfair and thereby fell into jurisdictional error. 123 At [84] of his Honour's reasons, the primary judge identified the following two questions of law raised by Mr Frugtniet in connection with para 39 of the Tribunal's decision record: (1) whether the findings were irrelevant considerations; and (2) whether Mr Frugtniet was denied procedural fairness in connection with the findings. 124 The primary judge concluded, at [87]-[89], that there was no denial of procedural fairness by the Tribunal because Mr Frugtniet was aware that the findings in the proceeding involving Tarson were in issue before the Tribunal, he was aware of the content and nature of those findings and he had the opportunity to deal with those findings in the course of the Tribunal's hearing. At [89], the primary judge expressed the view that it was difficult to see what more the Tribunal could have done with a view to enabling Mr Frugtniet to address the substance of the Tarson findings as he saw fit. 125 At [91], the primary judge accepted that historical dishonesty was a matter that was relevant to fitness and propriety. At [92], his Honour rejected Mr Frugtniet's submission that the scope of relevant matters is confined to credit activities, observing that a person's conduct and character in non-credit-related activities might bear upon their fitness and propriety to carry out credit activities and referring to the rejection of a similar submission by a Full Court in Maritime Union of Australia v Fair Work Commission [2015] FCAFC 56; (2015) 230 FCR 15 at [21]-[25]. 126 At [93], the primary judge concluded that whether Mr Frugtniet was a party to the proceeding involving Tarson was immaterial, saying: It could not be right that the AAT would be obliged to disregard a finding, made in a proceeding against a company, that its non-party director was not a witness of truth. There is nothing in the NCCP Act to support a conclusion that matters arising in proceedings can only be taken into account if the applicant was party to those proceedings. 127 At the hearing of the appeal, counsel for ASIC, Mr Knowles conceded that the primary judge incorrectly referred to Mr Frugtniet as Tarson's "non-party director" in this passage because, although Mr Frugtniet had previously been a director of Tarson, he had resigned from that role prior to the proceeding in the Victorian AAT. However, Mr Knowles submitted, that did not detract from the correctness of the proposition that the Tribunal could not have been obliged to disregard the finding of the Victorian AAT that Mr Frugtniet was not a witness of truth. Mr Knowles submitted that any error of the primary judge was an error of fact. 128 Finally, at [94], the primary judge rejected the contention that an inability to challenge a finding necessarily renders the finding irrelevant, noting that that inability might be a basis for an argument that the finding should be given little or no weight. However, the question of weight was one for the Tribunal and, in any event, Mr Frugtniet's argument concerned relevance and not weight.

Mr Frugtniet's submissions 129 Mr Frugtniet's written submissions were difficult to understand. They appear to re-agitate the arguments addressed by the primary judge at [92] and [93] of his Honour's reasons, but also seemed to raise a factual question about whether the relevant licence condition was breached and to say that the proceedings concerning Tarson were "tortuous" and that all matters concerning those proceedings had not been considered. 130 In his written submissions, Mr Frugtniet also seemed to submit that the Tribunal's finding that his conduct was "dishonest" was not justified by the evidence. This is a submission that does not appear to have been made to the primary judge or included in ground 3. Orally, Mr Frugtniet did not accept that he had made the concession set out in para 39 of the Tribunal's decision record (set out at [120] above) but he did not support that submission by reference to the transcript. 131 In oral submissions, Mr Frugtniet referred to a decision of Deputy President Rizkalla which he said was "in favour". Mr Frugtniet did not provide details of the decision, which seems to have been a decision of 28 September 1992 setting aside an earlier decision of the Travel Agents Licensing Authority cancelling Mrs Frugtniet's travel agent's licence. The reference to Deputy President Rizkalla's decision did not advance Mr Frugtniet's case. 132 Mr Frugtniet then referred to a decision in the Victorian Court of Appeal, again without providing any citation, in which the decision of Deputy President Rizkalla was set aside because "too much emphasis had been placed rather on me as opposed to the company". In Secretary to the Department of Justice v Frugtniet (1994) 8 VAR 23, the Appeal Division of the Supreme Court set aside Deputy President Rizkalla's decision of 28 September 1992. At [25], Ormiston J (Nathan J agreeing) concluded that the defect in the Deputy President's reasoning lay in her concentration on the culpability of Mr Frugtniet rather than on the responsibility of Mrs Frugtniet for Tarson's alleged failure to comply with the condition brought about by Mr Frugtniet's actions. At 36-37, Vincent J (Nathan J also agreeing) concluded that the Deputy President's decision could not stand for reasons that included the Deputy President's failure to refer to the particular importance of the special condition on Tarson's licence when, on the Deputy President's findings, Mrs Frugtniet was directly and personally implicated in a clear breach of the special condition by Mr Frugtniet's representation of Travel Trend (Victoria) in relation to a matter of considerable importance to the company, namely, the obtaining of IATA accreditation. These conclusions illustrate that the Appeal Division's reasoning does not advance Mr Frugtniet's case.

Consideration 133 The primary judge's reasons at [92] and [93] are correct for the reasons given by his Honour, despite the reference to Mr Frugtniet as a "non-party director". Mr Frugtniet's argument does not explain how there was an error in the Tribunal's conclusion that his behaviour, in causing Tarson to breach a licence condition that excluded him from involvement in Tarson's travel agency business, demonstrated dishonesty on his part. 134 The argument that the Tribunal took into account an irrelevant consideration fails because findings of dishonesty were relevant to whether there was reason to believe that Mr Frugtniet is not a fit and proper person to engage in credit activities. 135 Accordingly, the primary judge was correct to reject the argument that the Tribunal made any error of law in connection with its findings at para 39 of its decision record. 136 It follows that ground 3 must fail.

Ground 5: false answer to MARA 137 The relevant passage of the Tribunal's decision, set out at [103] of the primary judge's reasons, is as follows: 41. The Tribunal takes into account that in March 2000 Mr Frugtniet was acquitted of charges of theft and attempted theft while working for the ANZ Bank. However when he made application to MARA on 26 October 1999 for registration as a migration agent he did not disclose the charges, which were still pending, and despite his assertions that MARA had investigated the matter and had cleared him of any wrongdoing, documents show that on 3 February 2003 MARA decided not to take further action against him, although he was reminded of the requirement to declare any charges other than spent convictions. 138 Ground 5 is: The primary Judge erred by failing to find that the Tribunal misconstrued the statutory context of drawing upon an inference from a fact that did not exist namely that the appellant had given a false answer to MARA in 1999 in his repeat application which wasn't available on the evidence, in that MARA did not find that a false answer had been given in the 1999 application for repeat registration, so that the said inference from non-existent facts was clearly unreasonable and unjust for the Tribunal to have drawn upon such an inference in the context of propriety or otherwise going to matters of dishonesty. 139 Based on Mr Frugtniet's submissions, at [106] of his Honour's reasons, the primary judge identified the following questions of law raised by Mr Frugtniet: (1) whether the Tribunal's finding that Mr Frugtniet was obliged to disclose pending charges to MARA was a wrong finding; and (2) whether or not it was the case that the fact that Mr Frugtniet had failed to disclose pending charges to MARA was not relevant to whether he was a fit and proper person to carry on credit activities and that Tribunal was prohibited from taking it into account. 140 At [107], the primary judge concluded that the Tribunal had not found that Mr Frugtniet was obliged to disclose pending charges to MARA. Mr Frugtniet did not take issue with that conclusion on this appeal. At [112], the primary judge found that there was no basis in the NCCP Act for a conclusion that the Tribunal was obliged to disregard that Mr Frugtniet had given a dishonest answer to MARA in an application for repeat registration as a migration agent. 141 The proposition, contained in ground 5, that the fact that Mr Frugtniet had given a false answer to MARA in 1999 was "a fact that did not exist" is a contention that the Tribunal should not have made that factual finding. There was evidence to support the finding, namely, the answer which Mr Frugtniet gave to MARA and the evidence that Mr Frugtniet was facing criminal charges at the time that he gave the answer. In his written submissions, Mr Frugtniet seemed to accept that there was evidence of false answers. He characterised the answers as "simply erroneous" which, he observed, is insufficient to lead to a conclusion of dishonesty. 142 Mr Frugtniet's argument, in substance, is that the finding should not have been made in the light of other disclosures which he made to MARA and in the light of his contention that MARA did not find that a false answer had been given. That is an argument about whether the Tribunal erred in its factual finding: it is not based upon any question of law. 143 Accordingly, ground 5 does not identify any error of law on the part of the primary judge and fails.

Ground 6: false statements concerning social security 144 The relevant passage of the Tribunal's decision, set out at [117] of the primary judge's reasons, is as follows: 43. In respect of the Tribunal's findings in 2004 that Mr Frugtniet had knowingly made false statements which resulted in a debt owed to the Commonwealth under social security legislation, Mr Frugtniet stated that he would have lodged an appeal but for the fact that his application was successful on other grounds. This is a further example of Mr Frugtniet not accepting an independent decision that reached adverse conclusions about his honesty. 145 Ground 6 is: The primary Judge erred by failing to find that the Tribunal misconceived its statutory duty in drawing upon an inference not available on the facts that the Appellant's successful outcome of the Social Security matters before the AAT, did not provide a basis for appealing any particular finding, was therefore in essence an example of the Appellant not accepting an independent decision that reached adverse conclusions about his honesty and wasn't available on the evidence, so that filling in with facts not so found by the Tribunal by the primary Judge was unfair and unjust in the circumstances that would clearly illustrate the point of it being unreasonable. 146 Before the primary judge, Mr Frugtniet had complained of a denial of natural justice in relation to the finding at para 43 of the Tribunal's decision record. Ground 6 does not take issue with the primary judge's rejection of that complaint. 147 In his written submissions, Mr Frugtniet essentially contended that the primary judge should not have concluded that the Tribunal was entitled to reason from the first sentence of para 43 to the conclusion in the second sentence of para 43. Mr Frugtniet also noted that a refusal to accept the decision did not amount to dishonest conduct and contended that the Tribunal "converted" the non-acceptance to a finding of dishonest conduct. 148 The first sentence of para 43 sets out findings of fact. Mr Frugtniet did not submit that there was no evidence that a tribunal had made the findings described in para 43. Nor did he submit that he had not made the statement attributed to him in para 43. The second sentence of para 43 is a finding of fact that was open to the Tribunal on the basis of the findings in the previous two sentences. 149 It is true that a refusal to accept a decision is not dishonest conduct, but the Tribunal did not reach that conclusion. There is no reason why the primary judge should not have taken the second sentence of para 43 at face value. 150 Thus, there was no basis for the primary judge to find that the Tribunal had "misconceived its statutory duty" in the manner identified in ground 6. No error is apparent in the primary judge's conclusion. 151 It follows that ground 6 must fail.

Ground 7: disclosure by Unique Mortgage Services 152 The relevant passage of the Tribunal's decision, set out at [126] of the primary judge's reasons, is as follows: 44. In the agreement between UMS and AFG on 11 July 2005 Mr Frugtniet relied on technicalities including the fact that he had not been convicted of a criminal offence involving fraud in the previous ten years. However this restrictive and narrow approach ignored the duty of full disclosure. It must have been obvious to Mr Frugtniet that AFG would have been particularly interested in previous matters involving dishonesty, including the 1997 finding of guilt, even if actual convictions did not occur within the stipulated time limit. Similarly, when completing the credit licence application on behalf of UMS in November 2010 Mr Frugtniet provided answers that were false or misleading by not revealing all his relevant history. 153 The background facts are set out at [20], [21] [23] and [24] above. There are two relevant documents: a declaration made by Mr Frugtniet on behalf of UMS to AFG in July 2005, and an application for an Australian credit licence lodged by UMS with ASIC in November 2010. 154 Ground 7 states: The primary Judge erred by failing to find that the Tribunal misconceived its statutory duty in drawing upon a conclusion of law that was beyond its power and thus exceeded its jurisdiction in that it concluded that the Appellant was under a duty which was consistent with that of a duty invoking a legal obligation and not the meaning of anything else being filled in and ascribed to by the primary Judge in the application made to AFG. 155 At [128], the primary judge articulated Mr Frugtniet's complaint to be that the Tribunal concluded he had a legal obligation of full disclosure, that there was in truth no such legal obligation and therefore that the Tribunal had proceeded on an error of law. At [130], his Honour cast that question as whether the Tribunal erred in law in stating that Mr Frugtniet "ignored the duty of full disclosure". 156 At [131] and [132], the primary judge identified the questions to which Mr Frugtniet gave answers and referred to ASIC's submission to the Tribunal that, in relation to the credit licence application, the applicant knew or should have known that his answers were false and misleading. At [133], the primary judge considered Mr Frugtniet's cross-examination in the Tribunal on his answers in the 2005 declaration. 157 Although his Honour did not make a finding that any particular answer was false or misleading, the primary judge referred to the fact that MARA had initiated disciplinary action against Mr Frugtniet in May 2002. The declaration contained the answer "no" to a question asking whether Mr Frugtniet had been "subject to disciplinary proceedings or been expelled by a statutory body, professional or other body in respect of [his] professional capacity?" 158 After setting out the competing submissions, at [140] the primary judge concluded that the Tribunal's reference to "the duty of full disclosure" was not a reference to a "legal duty of full disclosure sourced expressly in a contractual term, a section of legislation, or elsewhere". His Honour noted that neither party put to the Tribunal that there was an obligation of that nature, and the Tribunal did not refer to the source of any such obligation. 159 His Honour concluded: Rather, my view is that what the AAT had in mind was, as ASIC submitted, that Mr Frugtniet had previously been criticised for partial or selective disclosure and warned about the risk of his answers thereby being false or misleading. Here, UMS was obliged by cl 4.2(a)(iii) of the Deed to provide the Declaration and Consent, and it was necessary to declare that the information in that declaration was "true and correct". 160 At [141] to [143], his Honour continued: [141] Of course, it is possible for a statement to be both literally true and nevertheless misleading or deceptive: see, e.g., CPA Australia Ltd v Dunn (2007) 74 IPR 495 at [28] (Weinberg J). And, as Mr Frugtniet had previously been warned, it is possible to mislead by omission. In that context, what the AAT likely had in mind was no more than that Mr Frugtniet would have engaged in wrongful or reproachable conduct if, by giving partial or selective disclosure, his statements in the declaration were misleading or deceptive or likely to mislead or deceive. That nature of wrongful or reproachable conduct would count against him in an assessment of fitness and propriety. In order to avoid reproach, it was necessary for Mr Frugtniet to complete the declaration in a manner that was sufficiently full and frank that his answers did not have such a misleading tendency. In other words, should he wish to avoid a finding of having engaged in conduct that counted against his claim to be a fit and proper person to engage in credit activities, his "duty" - and, with respect to the AAT, I accept that the word was not especially well chosen - was to have disclosed matters fully rather than partially or selectively. [142] Expressed compactly, the AAT did not find that Mr Frugtniet had a duty of full disclosure in the sense that he was obliged to volunteer information for which he had not been asked. Rather, his "duty" was of a far more limited character: it was to ensure that statements he made were not half-true, and were not technically true but misleading or deceptive by omission or selection. His "duty" was to answer questions sufficiently fully and frankly that his answers were not misleading or deceptive. The AAT did not have in mind that failure to discharge the duty constituted breach of a legal obligation (although it is possible that it would have); rather, the AAT had in mind that failure to discharge the duty would be to fall short of the standard expected of one who sought to establish fitness and propriety to engage in credit activities. [143] Read thus, the AAT's conclusion was one of fact rather than of law.

Mr Frugtniet's submissions 161 In his written submissions, Mr Frugtniet contended that the Tribunal made an erroneous conclusion of law that a "duty of full disclosure" was owed to AFG, arising from the Tribunal's failure to deal separately with the different contexts of the 2005 declaration and the 2010 credit licence application. 162 Concerning the 2005 declaration, Mr Frugtniet referred to s 8(2) of the Sentencing Act 1991 (Vic), which provides that, except as otherwise provided by that or any other Act, a finding of guilt without the recording of a conviction must not be taken to be a conviction for any purpose. Mr Frugtniet refuted the proposition that there was any "duty of full disclosure" where he was not acting in a "professional capacity". 163 Concerning the 2010 credit licence application, Mr Frugtniet noted that the application was made on an approved form pursuant to s 36 of the NCCP Act and argued that, as a consequence, any deficiency in the application should have been considered pursuant to s 80(1)(d) and not s 80(1)(f).

Consideration 164 It was open to the Tribunal to make the factual finding that Mr Frugtniet relied on technicalities in making the 2005 declaration, and took an approach that was "restrictive and narrow". Perhaps the clearest example is the reasons that he gave for answering no to the question whether he had been subject to disciplinary proceedings, in the face of disciplinary action brought against him by MARA. Mr Frugtniet's position involved drawing a distinction between disciplinary action and "disciplinary proceedings". 165 The Tribunal next made a finding of fact about Mr Frugtniet's "restrictive and narrow" approach to the 2005 declaration, concluding that his approach was one which ignored "the duty of full disclosure". In our view, at [140], the primary judge correctly interpreted the Tribunal's finding to relate to the criticism, made by Pagone J of Mr Frugtniet in 2002, in the context of an application for admission to legal practice, that the standard of fitness and propriety required Mr Frugtniet to disclose all matters that could inform a judgment about whether he was a fit and proper person. 166 We accept that the Tribunal did not differentiate between the legal requirements for disclosure in the context of an application for admission to legal practice and the legal requirements in the context of the 2005 declaration. However, the Tribunal was not addressing the question whether Mr Frugtniet satisfied the legal requirements for disclosure to AFG. As the primary judge correctly concluded, at [141]-[142], the Tribunal was considering what Mr Frugtniet's "restrictive and narrow" approach said about his fitness and propriety to engage in credit activities. In the context of an assessment of Mr Frugtniet's fitness and propriety to engage in credit activities, it was open to the Tribunal to assess Mr Frugtniet by reference to whether he disclosed matters fully rather than partially or selectively. 167 Thus, the Tribunal assessed Mr Frugtniet's behaviour in making the 2005 declaration and concluded, adversely to Mr Frugtniet, that by his "restrictive and narrow" approach, Mr Frugtniet ignored consideration of whether he should be frank, and whether he should give AFG all information in which they would have been interested. 168 The primary judge properly acknowledged that the word "duty" was not well chosen by the Tribunal. However, for the reasons given above, we accept the Tribunal did not make an erroneous conclusion that Mr Frugtniet owed a legal "duty of full disclosure" to AFG. 169 Concerning the 2010 credit licence application, it is not clear that Mr Frugtniet's argument falls within the scope of the ground of appeal. In any event, it is another illustration of the fallacy that the primary judge attempted to address in the concluding paragraphs of his Honour's reasons. That is, it is not a sufficient answer to the matters raised against Mr Frugtniet that he complied with the letter of the law. The Tribunal was not required to confine its consideration to whether the application complied with the law: it was required to consider the broader issue of how the application reflected upon Mr Frugtniet's fitness and propriety. 170 Accordingly, this ground of appeal fails.

Ground 8: non-acceptance of finding about failure to disclose in Frugtniet [2014] AATA 766 171 The relevant passage of the Tribunal's decision, set out at [145] of the primary judge's reasons, is as follows: 47. In respect of the Tribunal's decision in 2014 to affirm the decision of the Tax Practitioners' Board to cancel Mr Frugtniet's registration as a tax agent, the Tribunal notes that in those proceedings Mr Frugtniet did not accept the independent decision that his failure to disclose all relevant past conduct was wrong, despite the earlier comments by Gillard J and Pagone J in the Supreme Court. 172 The decision referred to in para 47 is Frugtniet [2014] AATA 766, referred to at [29] above. In that decision, the Tribunal stated at paras 105 to 108: 105. ... If, as he contended, he had put his past misdeeds behind him, I would have expected him to have disclosed his past conduct, including charges of which he was acquitted, which would then indicate sincerity in having changed from the person he was. That he chose not to do so, must be cause for concern that he has not changed his behaviour. In fact, the judgements of Pagone and Gillard JJ are highly critical of Mr Frugtniet's failure to disclose his past misconduct. As Gillard J said, if his past conduct shows him to be a man who is dishonest and cannot be trusted, he must show that his past is behind him and that he can be trusted to pursue an honest career. I find that Mr Frugtniet has failed to do so in answering the questions in his application in the negative. 106. I have also found the way in which Mr Frugtniet attempted to exculpate himself to be most disturbing. For example, his arguments about the Board of Examiners not being a professional body or registration board were wholly unmeritorious in the context in which he was required to make disclosure to the Board regarding his fitness and propriety to act as a tax agent. 107. Similarly, Mr Frugtniet's explanation for his conduct when he appeared before the Werribee Magistrates' Court is cause for serious concern. Despite transcript of that proceeding clearly indicating that he held himself out to be a sole practitioner (inferring that he was admitted as a legal practitioner) to the Magistrate, he then gave a totally implausible explanation including the suggestion that he was referring to the conduct of his practice as a migration agent, tax agent and conveyancer. It also appears as though Mr Frugtniet concocted a power of attorney for the purpose of establishing his right to appear on behalf of his clients. If that was the basis upon which he appeared, it begs the question why his response to the Magistrate was that he was a sole practitioner. In his supplementary submissions lodged with the Tribunal on 8 August 2014, Mr Frugtniet attempted to excuse his conduct by suggesting he had a brain snap and acted out of loyalty to a friend. I must say that every excuse Mr Frugtniet offered simply appears to make the situation worse than it was at the outset. 108. Finally, the most recent matter for concern was the complaint lodged by Ms Galvez-Londono regarding her tax return for the 2011 income year. His conduct in that matter indicates that he has learnt nothing from the past and that his dishonest behaviour has continued unabated. I find that he is clearly not a fit and proper person to be registered as a tax agent. He should not be permitted to deal with other people's money in any circumstances. 173 On 1 October 2015, in Frugtniet v Tax Practitioners Board [2015] FCA 1066, a judge of this Court allowed an appeal from the 2014 Tribunal decision on the ground of apprehended bias, and remitted Mr Frugtniet's application for review for hearing and determination by the Tribunal differently constituted. 174 Ground 8 is: The primary Judge erred by failing to find that the Tribunal misconceived its statutory duty in drew drawing upon matters in relation to the matter: Frugtniet [and Tax Practitioners Board] [2014] AATA 766, as evincing on part of the Tribunal that the Appellant's appealing the decision to the Federal Court amounted to [his] not accepting the [Tax Tribunal's] independent decision, instead the primary Judge reading beyond such a conclusion that his failure to disclose all relevant past conduct was wrong" which was plainly unjust and unreasonable with undue weight having being placed on such matters of little weight in the circumstances. (errors in original) 175 Mr Frugtniet's written submissions before the primary judge on this point are referred to at [146] of his Honour's reasons. At [151], the primary judge explained that Mr Frugtniet's submission was that the Tribunal had counted against him the mere fact of his appeal from the decision in Frugtniet [2014] AATA 766. 176 At [152], the primary judge concluded that Mr Frugtniet's argument was based upon a misconstruction of the Tribunal's reasons. We agree. The Tribunal's reasons are not concerned with Mr Frugtniet's appeal to the Federal Court. Rather, the reasons are directed to an argument put by Mr Frugtniet to the effect that he did not accept that his failure to disclose past conduct was wrong. 177 In his written submissions on the appeal, Mr Frugtniet noted that his appeal had been allowed and argued that the reasons in Frugtniet [2014] AATA 766 were "of no consequence anymore" and were an "irrelevant consideration". This is a matter that did not fall within the scope of the appeal before the primary judge and it does not fall within the scope of ground 8. In any event, those submissions must be rejected. In hindsight, it must be accepted that the decision to affirm the cancellation of Mr Frugtniet's registration as a tax agent has been set aside. That does not mean that the decision never occurred, or that the Tribunal (which determined Mr Frugtniet's application to review ASIC's decision before the Federal Court decided to set aside the Tax Tribunal's decision) was obliged to ignore the Tax Tribunal's reasons as part of its review of ASIC's decision: cf Lansen v Minister for Environment and Heritage [2008] FCAFC 189; (2008) 174 FCR 14 at [164]; Ma v Minister for Immigration and Citizenship [2007] FCAFC 69 at [27]; AZAAD v Minister for Immigration and Citizenship [2010] FCAFC 156; (2010) 189 FCR 494 at [41]. 178 As this ground of appeal is premised upon a misconstruction of para 47 of the Tribunal's decision record, it must fail.

Ground 9: non-disclosure to ASIC of MARA disciplinary proceeding 179 Ground 9 states: The primary Judge erred by failing to find that the Tribunal misconceived its statutory duty under [the NCCP Act], in that the Appellant was not under any obligation to disclose at that stage any interaction with MARA to ASIC, let alone any decision that ensued, which was in any case provided as part of the review application to the Senior Member who was assigned to hear the stay application as part of the review of the MARA decision but subsequently resolved to hear the ASIC matter in a short period of months and was apprised of matters so that no contention of apprehended bias was taken to the Member, instead the Tribunal being apprised of such matters and evidence being given that would inform ASIC who were in any event aware of such matters and were possessed of the decision does not give rise to such obligation taken in the statutory context where there was no such legal obligation cannot be filled in with assumptions of the primary Judge as what he the ought the Tribunal meant so that obligations are not findings of fact but matters of law. 180 The relevant passage of the Tribunal's decision is as follows: 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. 181 Mr Frugtniet's complaint is that the Tribunal found that he was obliged to disclose MARA's decision of 6 November 2014 to cancel Mr Frugtniet's registration as a migration agent ("MARA decision") to ASIC before the Tribunal's hearing. Mr Frugtniet did not challenge the primary judge's finding (at [165]) that he had agreed under cross-examination that the decision was relevant to the matter then before the Tribunal, namely, whether ASIC's banning order should be affirmed. 182 Nor did Mr Frugtniet dispute the primary judge's finding (at [171]) that Mr Frugtniet had made the following positive statement, in his SoFC to the Tribunal, dated 20 October 2014: 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. 183 Nor did Mr Frugtniet dispute the primary judge's finding (at [164]) that, on 27 November 2014, Mr Frugtniet lodged a statement in reply with the Tribunal, in which he did not refer to the MARA decision. 184 At [172] of his Honour's reasons, the primary judge concluded that the finding that Mr Frugtniet sought to challenge was a finding of fact with which the primary judge could not interfere. We agree with that conclusion for the reasons given by the primary judge. 185 By rejecting the proposition that Mr Frugtniet had no obligation to disclose the MARA decision to ASIC before the hearing, the Tribunal did not make an error of law. It simply rejected Mr Frugtniet's argument. On the face of the decision, the rejection was based upon the matters identified by the Tribunal: namely, the preparation of an incorrect and misleading SoFC which was further falsified by the MARA decision. The SoFC was submitted to the Tribunal in support of an application in respect of which a relevant consideration was whether Mr Frugtniet was honest. 186 In that context, it was plainly open to the Tribunal to reject the assertion that there was no obligation of disclosure because the factual assessment of Mr Frugtniet's fitness was likely to depend, amongst other things, on whether the Tribunal was satisfied that Mr Frugtniet had disclosed all matters that were germane to the question of his honesty (subject to the possible application of the spent convictions legislation). 187 Ground 9 therefore fails and it is unnecessary to address ground 4 of the notice of contention.

Ground 10: false statement in application for stay 188 Ground 10 is: The primary Judge erred by failing to find that the Tribunal's finding that the statement by the Appellant of there being no complaint which it said was wrong and misleading, however, it did not mislead any party and was a semantical distinction, including intervening to uphold the decision of the Tribunal and converting questions of morality to be in accordance with law. 189 The Tribunal's findings, at paras 49 and 51 of the decision record are: 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…. … 50. his assertion that he has not been the subject of a single complaint about his behaviour as a credit facilitator is wrong and misleading. 190 As set out at [31] above, the finding related to a reason given by Mr Frugtniet for seeking a stay of the banning order. ASIC argued that the reason was falsified by a complaint about Mr Frugtniet's activities as a credit facilitator which, according to Mr Frugtniet, was not yet the subject of a determination by the Financial Services Ombudsman. 191 Ground 10 articulates a complaint that the primary judge erred by failing to find a factual error on the part of the Tribunal, namely, the Tribunal's finding that Mr Frugtniet's statement that there had been no complaint was wrong and misleading. 192 At [180], the primary judge found that this was "patently a complaint about a finding of fact". His Honour also concluded that oral submissions made by Mr Frugtniet that he was correct in having said at a particular time that no complaints had been made against him did not raise a question of law. At [184] and [186], the primary judge set out correspondence between the Credit Ombudsman Service Ltd and Mr Frugtniet regarding a complaint received from "AT". 193 In his written submissions (in chief and in reply), Mr Frugtniet put forward matters about the characteristics of the complaint made by "AT" - that it was not published, not adjudicated upon and not the subject of internal dispute resolution and that it was "a complaint the client was dealing with UMS in circumstances where I was representative". Mr Frugtniet also contended that the Tribunal's conclusions were irrelevant in those circumstances. Orally, Mr Frugtniet's submission was that "in all my tenure I've only had one complaint", which appeared to be a reference to a complaint to MARA (not the Financial Services Ombudsman) in respect of which there were ongoing proceedings. 194 Mr Frugtniet's submissions on this ground have no merit. His Honour correctly concluded that the Tribunal's relevant finding was a finding of fact. To the extent that ground 10 suggests that it is relevant that Mr Frugtniet's statement "did not mislead any party and was a semantical distinction" or that the Tribunal's finding involved "converting questions of morality to be in accordance with law", this appears to be another illustration of the misconception that it is necessary for there to be legal wrongdoing (and, in particular, a contravention of credit legislation) in order for Mr Frugtniet's conduct to be inconsistent with propriety.

Conclusion 195 For these reasons, none of Mr Frugtniet's grounds of appeal have any merit. Accordingly, his appeal must be dismissed with costs. It is therefore unnecessary to deal with any of the matters raised by ASIC's notice of contention. I certify that the preceding one hundred and ninety-five (195) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justices Reeves, Farrell and Gleeson.

Crimes Legislation Amendment Act 1989(Cth)

Administrative Decisions Tribunal Act 1997(NSW)s 63

Legal Profession Act 2004(Vic)

Crimes Act 1914(Cth)ss 85ZM, 85ZV, 85ZW, 85ZZH

Migration Act 1958(Cth)ss 279, 280

ion and Ethnic Affairs v Wu Shan Liang [1996] HCA 6; (1996) 185 CLR 259 Repatriation Commission v Hill [2002] FCAFC 192; (2002) 69 ALD 581 Shi v Migration Agents Registration Authority [2008] HCA 31; (2008) 235 CLR 286 Sun v Minister for Immigration and Border Protection [2016] FCAFC 52; (2016) 243 FCR 220 Toohey v Tax Agents Board of Victoria (2007) [2007] FCA 431; (2007) 171 FCR 291

THE COURT: 1 Mr Frugtniet appeals from a decision of a single judge of this Court dismissing his appeal from a decision of the Administrative Appeals Tribunal ("Tribunal") which, in turn, affirmed a decision of a delegate of the Australian Securities and Investments Commission ("ASIC") making a banning order against Mr Frugtniet: Frugtniet v Australian Securities and Investments Commission [2016] FCA 995; (2016) 152 ALD 31. 2 ASIC's banning order was made pursuant to s 80 of the National Consumer Credit Protection Act 2009 (Cth) ("NCCP Act"), following the delegate's decision that ASIC had reason to believe that Mr Frugtniet was not a fit and proper person to engage in credit activities. 3 Mr Frugtniet applied unsuccessfully to the Tribunal for review of the banning order pursuant to s 327 of the NCCP Act: Frugtniet v Australian Securities and Investments Commission [2015] AATA 128. Following that unsuccessful application, by s 44(1) of the Administrative Appeals Tribunal Act 1975 (Cth) ("AAT Act"), Mr Frugtniet was entitled to appeal to this Court, on a question of law, from the Tribunal's decision. The primary judge was not persuaded that the Tribunal had made any error of law. 4 For the reasons that follow, Mr Frugtniet's appeal from the decision of the primary judge should be dismissed. Costs should follow the event.

At a glance

Court

Decision date

Before

Source

Judgment (23 paragraphs)

Parties

Legislation Cited (13)

Cases Cited (62)