Leto v Secretary Department of Customer Service [2026] NSWCATOD 26;

(1) The Tribunal must have regard to any evident risk based on the kinds of work the licence would permit the Applicant to undertake, not based on the nature of the work proposed to be undertaken which does not require a licence;

(2) The Applicant has not demonstrated sufficient financial viability to undertake work of the kind authorised by the licence;

(3) The Applicant has not shown that he took all reasonable steps to avoid liquidation;

(4) Risk mitigation measures put in place by the Applicant may be satisfactory for undertaking inspection services, however they are insufficient for carrying out the kinds of work authorised by the licence;

(5) Based on a construction of the statute, a condition under s 33C(4) may only be considered after s 33C(3) is satisfied;

(6) Section 36 provides that an authority is subject to certain conditions and sets penalties for breach. If s 36 does create a separate power to impose conditions, s 33C(3) must still be met independently.

1. The Internal Review Decision considered the issue of whether the Applicant is a fit and proper person to hold a contractor licence. The Internal Review Decision concluded that the original decision did not assuredly establish that the Applicant is not a fit and proper person to hold a contractor licence. The Applicant contends in submissions that he is a fit and proper person to hold a contractor licence. As the Respondent does not press this issue before the Tribunal, no further consideration is given to that matter in this decision.

1. The Applicant helpfully provided the Tribunal with a court book containing the documents relied on by the parties at the time of the hearing.
2. The Applicant relies on written submissions, oral submissions and was cross examined at the hearing.
3. The Applicant relies on the following documents:

(1) Administrative Review Application form dated 16 March 2025 filed 17 March 2025

(2) Applicant's outline of submissions dated 17 June 2025 filed 18 June 2025

(3) Affidavit of Jason Frank Leto affirmed 17 June 2025 filed 18 June 2025

(4) Exhibit JL1 dated 17 June 2025 filed 11 July 2025, including sound recording

(5) Applicant's submissions in reply dated 5 August 2025 filed 6 August 2025

(6) Exhibit JL2 dated 5 August 2025 filed 6 August 2025

(7) Applicant's written submissions dated 26 August 2025 filed 27 August 2025

(8) Applicant's written submissions in reply dated and filed 29 September 2025.

1. The Respondent relies on written submissions and oral submissions made at the hearing.
2. The Respondent relies on the following documents:

(1) Respondent's section 58 documents filed 11 April 2025

(2) Addendum to Respondent's section 58 documents filed 12 May 2025

(3) Respondent's written submissions dated 9 July 2025 filed 11 July 2025

(4) Respondent's supplementary written submissions dated and filed 18 September 2025.

1. Section 83B(1) of the HBA confers jurisdiction on the Tribunal for administrative review of the Respondent's decision pursuant to s 9 of the Administrative Decisions Review Act 1997 (the ADR Act).
2. Under s 63(1) of the ADR Act the Tribunal must decide what the correct and preferable decision is having regard to the material before it. When conducting an administrative review, the Tribunal may exercise all of the functions conferred or imposed by relevant legislation on the decision-maker who made the decision: s 63(2) ADR Act. The Tribunal stands in the shoes of the decision-maker: Wojciechowska v Secretary, Department of Communities and Justice; Wojciechowska v Registrar, Civil and Administrative Tribunal [2023] NSWCA 191 at [98]; NSW Self Insurance Corporation v EEH [2023] NSWCATAP 181 at [86].
3. The Tribunal may determine an administrative review application by affirming the decision under review, varying the decision, setting the decision aside and making a decision in substitution or setting the decision aside and remitting it to the administrator for reconsideration in accordance with any directions or recommendations: s 63(3) ADR Act.

1. The requirements for proof of questions of fact in administrative review proceedings were summarised by the Appeal Panel in Meacham v Commissioner of Police [2020] NSWCATAP 107 at paragraphs [54] and [83]:

"[54] Despite not being bound by the rules of evidence, the Tribunal is required to base its findings of fact on "logically probative material", and not on "mere suspicion or speculation", as a corollary of its obligation to act reasonably: Minister for Immigration and Ethnic Affairs v Pochi [1980] FCA 85; (1980) 44 FLR 41 ("Pochi") at 62, 68 (Deane J); [1980] FCA 85; Sullivan v Civil Aviation Authority (2014) 22 FCR 555; [2014] FCAFC 93 ("Sullivan") at [5]-[8], [15]-[17] (Logan J). It is an error of law for the Tribunal to make a finding of fact with no evidence, or no probative evidence, to support it.

...

[83] Proof of matters which are asserted is required in a practical sense, and a party asserting a fact is generally required to provide evidence to substantiate it. As noted above, the Tribunal is required to base its findings of fact on "logically probative material": Pochi at 62, 68; Sullivan at [5]-[8], [15]-[17]."

1. The scheme of the HBA is concerned to provide consumer protection including regulating the issue, suspension and cancellation of various licences in relation to residential building work. The Tribunal in McGufficke v Commissioner for Fair Trading [2022] NSWCATOD 176 at [48] noted that "the overall purpose of the HBA is to protect consumers in the contracting for and the construction of residential buildings."
2. In this case the Applicant seeks a "contractor licence". A contractor licence issued by the Respondent authorises its holder to contract to do the "residential building work" and "specialist work" described in the contractor licence: s 21(1) HBA.
3. Sch 1 cl2 of the HBA defines "residential building work" as any work involved in, or involved in co-ordinating or supervising, any work involved in the construction of a dwelling or the making of alterations or additions or repairing, renovation, decoration or protective treatment of a dwelling. Sch 1 cl 1 of the HBA defines "specialist work" which is not applicable in this case.
4. Section 19 of the HBA gives the Respondent the power to grant a contractor licence.
5. Under s 20(1)(a1) and s 20(1)(a2) the Respondent must refuse an application for a licence if not satisfied of the matters under s 33B or s 33C of the HBA.
6. Section 20 of the HBA relevantly provides:

"20 Issue of contractor licences

(1) The Secretary must refuse an application for a contractor licence if -

...

(a1) the Secretary is not satisfied as to the matters of which the Secretary is required to be satisfied by section 33B, or

(a2) the Secretary, after considering evidence supplied by the applicant, is not satisfied as to the matters of which the Secretary is required to be satisfied by section 33C, or

..."

1. Section 33B(1)(a)(xvi) of the HBA relevantly provides:

"33B General requirements for issue of certain authorities

(1) An authority (other than an owner-builder permit) must not be issued unless the Secretary is satisfied that -

(a) each relevant person in relation to the application for the authority -

...

(xvi) except in relation to an application for a tradesperson certificate - within 10 years before the date of the application, was not a director of or a person concerned in the management of a body corporate that was a Chapter 5 body corporate at any time within that 10-year period (other than Chapter 5 body corporate resulting from a members' voluntary winding up of the body corporate), ..."

1. "Chapter 5 body corporate" is defined at Sch 1 cl1 of the HBA to have the same meaning as in the Corporations Act 2001 (Cth), which defines "Chapter 5 body corporate" in s 9 to include a body corporate that is being wound up or is under administration.
2. Section 33C of the HBA relevantly provides:

"33C Additional requirements for obtaining contractor licences

...

(2) Despite section 33B(1)(a)(xiii) and (xv), a contractor licence may be issued if -

(a) the licence does not authorise its holder to do general building work or swimming pool building, and

(b) the Secretary is of the opinion that there is no evident risk to the public that the applicant will be unable to complete contracts entered into in the future to do residential building work or specialist work, and

(c) the Secretary is of the opinion that the relevant person concerned took all reasonable steps to avoid the bankruptcy, liquidation or appointment of a controller or administrator, and

(d) the licence is subject to a condition that the holder must not enter into a contract to do work if the contract price exceeds $20,000 (inclusive of GST) or (if the contract price is not known) the reasonable cost of the labour and materials involved in the work exceeds $20,000 (inclusive of GST).

(3) Despite section 33B(1)(a)(xiv), (xvi) and (xvii), a contractor licence may be issued if, after considering evidence supplied by the applicant, the Secretary is satisfied that -

(a) there is no evident risk to the public that the applicant will be unable to complete contracts entered into in the future to do residential building work or specialist work, and

(b) the relevant person concerned took all reasonable steps to avoid the bankruptcy, liquidation or appointment of a controller or administrator, and

(c) the relevant person concerned has put in place sufficient risk mitigation measures to avoid a future bankruptcy, liquidation or the appointment of a controller or administrator.

(4) A contractor licence issued under subsection (3) may be issued subject to a condition that the holder of the licence must not enter into a contract to do work if the contract price exceeds $20,000 (inclusive of GST) or (if the contract price is not known) the reasonable cost of the labour and materials involved in the work exceeds $20,000 (inclusive of GST).

(5) A condition imposed under subsection (4) may be limited so that it does not apply to a subcontract entered into by the holder of the licence. A subcontract is a contract that is made between parties who each hold a contractor licence and that is for work that each party's contractor licence authorises the party to contract to do."

...

1. The question of whether a licence holder took "reasonable steps" to avoid a bankruptcy or insolvency has been considered in a number of decisions.
2. In Clarke v Commissioner of Fair Trading, Office of Fair Trading [2004] NSWADT 273 the Tribunal's President referred to a number of earlier decisions under comparable provisions in the Property, Stock and Business Agents 2002 and concluded at paragraphs [9] - [10]:

"9 The Tribunal has already dealt with three applications for review arising under the new provisions: McDonald v Commissioner for Fair Trading [2004] NSWADT 124, Smith v Commissioner for Fair Trading [2004] NSWADT 182 and Davidson v Commissioner for Fair Trading [2004] NSWADT 200.

10 It has expressed the following views as to the approach to be taken in examining the question of whether the licence holder took 'reasonable steps' to avoid the bankruptcy or insolvency:

(i) A general inquiry into the wisdom or otherwise of the original financial dealings that ultimately ended in bankruptcy or insolvency is not contemplated by the Act. The point at which the inquiry commences is when the applicant was 'faced with the possibility' of bankruptcy or insolvency (Davidson at [20]) or was 'aware' or 'should have been aware' (McDonald at [21]) of that possibility. The focus is the steps taken to avoid the relevant event (see Smith at [17]) - in cases of the present kind, administration, and later liquidation.

(ii) Subject to (i), in assessing reasonableness the Tribunal must examine all the relevant facts and circumstances. (McDonald at [25]),

(iii) The steps taken by the applicant must be objectively reasonable in the sense that they would be those taken by a 'reasonable person endowed with the knowledge and experience of the [applicant]'. (McDonald at [26-27])

11 To these should probably be added a fourth, though it is obvious enough from the provision:

(iv) The person under notice has the task of satisfying the Commissioner that he or she took all reasonable steps to avoid the insolvency."

1. Under s 36 of the HBA an authority is subject to conditions including those imposed by the Secretary.

Are the requirements of s 33B of the HBA satisfied?

1. Under s 33B of the HBA an "authority" (means a contractor licence: Sch 1 cl1) must not be issued by the Respondent unless satisfied of certain matters. Relevant to this case, the Respondent must be satisfied that the Applicant was not a director of a body corporate that was a Chapter 5 body corporate at any time within 10 years before the date of the application: s 33B(1)(a)(xvi) HBA.
2. The Applicant was a Director of Meridian Property since 1 April 2015. ASIC records provided by the Respondent show Meridian Property was placed into liquidation by Order of the Court on 9 July 2020.

1. Based on the documentary evidence and submissions of the parties, the Tribunal is satisfied that the Applicant was a director of a body corporate that was a Chapter 5 body corporate within the last 10 years and does not satisfy the requirements of s33B.

Are the requirements of s 33C(3) of the HBA satisfied?

1. Under s 33C(3) of the HBA the Respondent may issue a contractor licence despite noncompliance with s 33B(1)(a)(xvi) if satisfied of the matters set out in s 33C(3)(a),(b) and (c).

1. The Applicant contends that there is no evident risk to the public that he will be unable to complete contracts entered into in the future to do residential building work or specialist work because he will not be entering into such contracts. The Applicant seeks to hold the licence solely for the purpose of providing services as a building inspector, including engaging in new construction inspection activities and reporting.
2. Further, the Applicant submits that any concern as to risk can be mitigated by the Tribunal imposing a condition under s 33C(4) limiting contracts entered into to $20,000.
3. The Applicant has been operating a building inspection business, Meridian NSW Pty Ltd registered in March 2019 as the sole director. The business uses the business name Jim's Building Inspections Cecil Hills registered on 16 December 2024. The Applicant states that this company does not engage in residential building works. Its sole focus is pre-purchase inspections, consultancy and defect reporting.
4. The Applicant contends that the business model significantly reduces financial risks as he is not engaged in his own capacity as a traditional building contractor for the purposes of the HBA. His role is limited to preparing reports, conducting site assessments and providing compliance advice. He does not engage subcontractors or enter fixed price construction contracts.
5. The Applicant argues that while he does not intend to enter into contracts for residential building works, his business operations nonetheless require him to hold a contractor's licence. He contends that it provides clear evidence that he possesses the requisite qualifications, experience and regulatory standing to conduct building inspections lawfully; that a contractor's licence will ensure that his business meets industry standards and remains accountable to regulatory bodies; supports consumer confidence and business credibility and reduces exposure to legal and financial risks.
6. The Applicant provides two letters from an accountant dated 26 November 2024 providing their opinion "that it is financially viable for our client to carry out this new business" and a letter of 2 December 2024 confirming that the Applicant has no assets or liabilities in his name (Exhibit JL1). He also relies on a Profit and Loss statement from 1 July 2025 to 30 June 2025 showing net earnings of $33,576 and he projects income for year one of $85,750 (Affidavit in reply 5 August 2025 filed 6 August 2025 and Exhibit JL2).
7. The Applicant's Affidavit in reply gives evidence that he purchased a franchise for $69,000 to carry out the building inspection business and a vehicle worth $35,000. These are assets funded by the Applicant and are now assets held by the operating entity Meridian NSW Pty Ltd.
8. The Applicant also submits that where any residual risk exists, that risk can be managed by imposing a condition limiting the Applicant's contractor licence to general building work involving inspections and contracts not exceeding $20,000.
9. Referring to Maynard v Secretary, Department of Customer Service [2025] NSWCATOD 27 and Karall v Secretary, Department of Customer Service [2025] NSWCATOD 38, the Applicant submits that the cases demonstrate the discretion under s 33C(3) is evaluative and contextual, where appropriate, extending to the imposition of conditions under s 33C(4).
10. The Applicant submits that s 33C(4) must be understood as operating in parallel with s 33C(3) of the HBA. The existence of the power to impose a condition under s 33C(4) necessarily informs the Tribunal's assessment of risk under s 33C(3). In the Respondent's submission, nothing in the HBA states that failure under s 33C(3) permanently prevents the imposition of a condition under s 33C(4). Further the Tribunal may impose conditions under s 36 or s 33C(4).

1. The Respondent submits that the Tribunal must assess and determine the Review Application for what the licence permits, that is residential building work, not based on the Applicant's stated intention not to use the licence for that purpose.
2. On that basis, the Respondent contends that as the Applicant has no assets, the Applicant has no access to working capital, there is no basis to conclude that he would have access to credit and no demonstrated resources to pay for building materials or buy or hire tools and equipment unless funded first by clients. The Respondent submits that there are restrictions on maximum deposits and progress payments in building contracts.
3. The Respondent also submits that there is no evidence as to whether Meridian Property's unsecured creditors have sought to recover against him. The Respondent relies on the Statutory Report to Creditors dated 25 September 2020 (Liquidator's Report) which states that Meridian Property had 124 unsecured creditors estimated at $1,553,809. The Applicant disputes this amount and contends that the correct amount is $732,592, based on an Aged Payables summary as at 21 July 2020 prepared by Meridian Property.
4. Accordingly the Respondent's position is that there is an "evident risk" that any future building contracts that the Applicant entered into if licenced could not be completed.
5. The Respondent also made supplementary written submissions on the imposition of conditions and the interpretation to be afforded to s 33C(4) in the context of s 33C(3) of the HBA. In summary the Respondent contends that the power to impose a condition on a licence under s 33C(4) only arises if the "requirements" for granting the licence are made out under s 33C(3).
6. The Respondent also submits that pursuant to s 36 of the HBA the Tribunal has a broad power to impose conditions, but where there are two sources of power, they would not have been intended to give rise to inconsistent outcomes.

1. The Respondent gives evidence that 12 complaints were made against Meridian Property while licenced. The Tribunal considers the Respondent to be making the submission that these complaints, together with three fines and the issuing of a Rectification Order by the Tribunal in respect of defective works, show evident risk to the public.
2. The Respondent also contends that it is unclear whether Meridian Property fully, or at all, complied with Tribunal Orders. The Respondent submits that a consumer's renewal application was unable to proceed and had to be withdrawn because of Meridian Property's liquidation. The consumer informed the Respondent that the consumer had to rectify the works at his own cost.
3. The Respondent also refers to four Home Warranty insurance claims paid out in relation to Meridian Property which included three major defect claims and a failure to complete claim totalling $228,548.66. The Respondent contends that costs of claims are passed on to consumers and that the Applicant may not be able to secure insurance in the future.
4. The Applicant submits that the Respondent has not pointed to substantiated findings of non-compliance and the suggestion that Meridian Property did not comply with Tribunal Orders is speculative. The Applicant's evidence is that the work order was made by consent of the parties and the Applicant attended to rectification works. Had the Applicant failed to comply with the orders of the Tribunal, the consumers could have raised this with the Tribunal by 31 March 2020. The renewal proceeding was brought after this time.
5. The Applicant also submits that the insurance claims were made after liquidation and were not considered by the Respondent in its original decision. The Applicant contends it is unfair and irrelevant to consider them.

1. Pursuant to s 33C(3)(a) of the HBA the Tribunal must be satisfied that there is no evident risk to the public that the Applicant will be unable to complete contracts entered into in the future "to do residential building work or specialist work."
2. The provision plainly requires a level of satisfaction to be reached regarding "residential building work" or "specialist work", regardless of the Applicant's stated intention not to carry out that work. Building inspector services do not fall within the definition of "residential building work or specialist work" and no contractor licence is required under the HBA to carry out inspector services.
3. The Tribunal is not satisfied that there is no evident risk to the public that the Applicant will be unable to complete contracts entered into in the future to do residential building work or specialist work, which is the work that would be authorised by a contractor licence. By the Applicant's evidence, he has no assets in his name and has not demonstrated that he has the financial means to undertake work of that kind, including to purchase the necessary tools and equipment.
4. The Tribunal accepts the evidence of the Liquidator's Report that the Applicant had no assets and creditors of $1,553,809 at the time of winding up. The Liquidator's Report was prepared at the relevant time by an independent third party and is preferred over the unsigned document subsequently prepared by the Applicant's accountant. While the Applicant contends that the debts were $732,592 he has not explained this nor his assertion that the Liquidator's Report miscalculated the amount. In any event, either figure represents a significant debt incurred by the Applicant when he last held a licence.
5. In relation to the Applicant's compliance history, the issue for the Tribunal is whether it demonstrates that he is unable to complete future contracts entered into to do residential building work. Of relevance is whether or not the Applicant in fact carried out all of the works in accordance with Tribunal Orders. The evidence in that regard is inconclusive.
6. However the Tribunal does consider the paid-out insurance claim for incomplete work is evidence of failure to complete in the past. The Tribunal is able to consider all material before it, and the Applicant has had procedural fairness to address the issue by virtue of these proceedings. In addition the Applicant has given evidence that he was unable to complete projects due to financial difficulties. Considered alongside the Applicant's current financial situation referred to at [59], the Tribunal cannot be satisfied that there is no evident risk of future non-completion.
7. The Tribunal considers that all three requirements set out in s 33C(3) of the HBA must be fulfilled in order for the discretion to be exercised to grant the licence in circumstances where the Applicant does not comply with s 33B. It is only after those requirements are satisfied and the discretion exercised to grant a licence, that the conditions of that licence may be considered under s 33C(4) of the HBA.
8. A condition cannot be imposed under s 33C(4) of the HBA in order to meet the requirements of s 33C(3)(a), (b) and (c). First the condition provision in s 33C(4) is separate to the requirements set out in s 33C(3). In contrast, 33C(2) has four requirements which must be met in order for the discretion to be exercised to grant a licence, including at s 33C(3)(d) that the licence is subject to a condition that the holder not enter into contracts over $20,000. Second s 33C(4) is framed in the past tense referring to a contractor licence "issued under subsection (3) may be issued subject to a condition", indicating that the requirements in s 33C(3) must first be satisfied.
9. The Tribunal agrees with the interpretation set out in Karall v Secretary of the Department of Customer Service [2025] NSWCATOD 38 at [85]:

I have had regard to the Applicant's request that if granted a contractor licence, that it be subject to a condition that it be limited to contracts of $20,000. Whilst I accept that such a condition can be imposed on a contractor licence, in my view, 33C(3) of the HBA provides that the Tribunal must be satisfied in relation to each of each of the matters set out in s 33C(3) before it may issue a contractor licence. Accordingly, I find that the Tribunal is required to make a determination pursuant to s 33C(3) of the HBA in relation to the issue of a contractor licence, prior to considering whether a condition should be imposed on that licence. As a consequence, I have no regard to the Applicant's prosed condition in my consideration of the matters set out in s 33C(3) of the HBA.

1. While the Tribunal has not been directed to decisions considering s 36 of the HBA, on an ordinary reading, the provision states that an authority is subject to conditions set out in Schedule 3, prescribed by the Act or regulations or imposed by order of the Secretary and prescribes penalties for breaching them. If s 36 can be read as creating a separate power to impose a condition, the requirements in s 33C(3) must still be satisfied independently, for the reasons already given.
2. Accordingly s 33C(3)(a) is not satisfied. While the licence cannot be issued where one of (a) to (c) is not satisfied, the Tribunal considers s 33C(3)(b) and (c) below for completeness.

Did the Applicant take all reasonable steps to avoid the liquidation?

1. In summary the Applicant's position is that the decline in the financial position of Meridian Property was due to external factors beyond his control and that on becoming aware of financial difficulties he took steps to avoid liquidation.
2. The Applicant's "Additional Form 5 - External Administration of a Company" (Additional Form) of his Application for a contractor licence contains relevant evidence. The Applicant's response to items 3.2, 3.3 and 3.4 of the Additional Form are set out in his Affidavit of 17 June 2025.
3. At 3.2 of the Additional Form the Applicant states that he first became aware that the company was experiencing financial difficulties in 2019 due to the impacts of COVID-19 which affected the building and construction industry as a whole.
4. In his Affidavit of 17 June 2025 at par 13, the Applicant states that the company experienced financial hardship in "2019 and 2020 due to rising material costs, subcontractor shortages, and the impact of COVID-19 on residential projects in New South Wales." He also states at par 25 that the "reason for liquidation of the company was due to external factors such as COVID-19 pandemic on cash flow and a lack of strategic management".
5. On cross examination the Applicant was asked when he first realised as a director that Meridian Property had some financial problems and replied that in late 2019 the accountant called him in to go through everything and brought the issues to his attention.
6. The Applicant sets out the reasons or circumstances that existed for the financial problems at 3.3 of his Additional Form. He states that there was a transitional period in about 2018 or 2019 where the directorship of the company changed as his business partner left the company in 2019. This departure put the Applicant under stress as he had to manage the administrative functions of the company as well as the site control. The effects of COVID were impacting the financial sustainability of building residential homes and margins diminished due to trade shortages and increases in demand for trade supplies.
7. At 3.4 of the Additional Form the Applicant was asked what actions he took to address the financial pressures arising, once he became aware of the financial difficulties for the company. The Applicant stated that he attempted to enter into payment arrangements with subcontractors to finish jobs without taking on new projects due to cash flow constraints.
8. At 3.5 of the Additional Form the Applicant was asked what steps he took to avoid the company having to be placed into external administration. In response the Applicant states he had a meeting with his accountant in or about October 2020 to discuss the financial affairs and was advised to obtain a line of credit. However, "due to the scale of projects in lead up to COVID-19 I could not obtain a short term line of credit to complete the projects and receive final payments." At the hearing the Applicant submitted that the meeting with his accountant must have been in October 2019 not 2020.
9. The Applicant's Outline of Submissions filed 18 June 2025 refer to different time frames and assert other facts. While those matters are referred to as the Applicant's "evidence" in the Applicant's Submissions in Reply of 6 August 2025, there is no evidence in the Applicant's Affidavits of the asserted facts.
10. For example, at par 6 of the Outline of Submissions, the heading "Unplanned departure of business partner in 2018-2019" follows with a submission that the business partner exited the company on short notice. In the Applicant's Submissions in Reply to the Respondent's submissions, at par 16c the submissions state:

The Applicant's evidence details that the deterioration in MPG's financial position began after the departure of the Applicant's business partner, [business partner's name], in June 2016.

1. The Outline of Submissions also state that the Applicant made a payment of $100,000 to exit the company. During this period, the company sought to increase sales of house and land packages and established a display centre with estimated establishment costs of between $40,000 and $50,000 and lease of $28,000 per annum. In Submissions in Reply at par 16e the Applicant states that his wife made a number of personal cash injections into the business in early 2020.
2. Under cross examination the Applicant gave evidence that he put cash into the business from late 2019 to early 2020, taking a mortgage on his wife's property, to try and finish existing jobs, pay contractors and loans.

1. The Respondent refers to the decision in Poytress v Director General, NSW Fair Trading [2015] NSWCATOD 100. At [40] the Tribunal refers to Clarke v Commissioner of Fair Trading, Office of Fair Trading [2004] NSWADT 273 and decisions referred to in that case regarding comparable provisions in other legislation. Those decisions state that the point at which the inquiry commences as to whether the Applicant took all reasonable steps to avoid liquidation is when the Applicant was "faced with the possibility" of bankruptcy or insolvency or was "aware" or "should have been aware" of that possibility. The focus is the steps taken to avoid the relevant event, that is administration and later liquidation.
2. The Respondent contends that the "event" in this case is the Court's winding up order following a winding up application by a creditor (In Liquidation) for non-payment of a debt of $6,067.
3. The Respondent refers to the evidence and cross examination of the Applicant who confirmed he received the statutory demand for payment. When questioned about what he did regarding it, he could not recall or explain any steps taken. When asked why he did not simply pay the demand of $6,067, the Applicant said words to the effect of "Don't know. Probably couldn't afford it."
4. On cross examination the Applicant confirmed that he was served with a copy of the winding up application and that he knew that the consequences of failing to deal with a winding up application would be the appointment of a liquidator. When questioned about what he did, the Applicant said words to the effect "I don't remember. Probably nothing."
5. The Respondent contends that the Applicant's answer on the Additional Form at 3.1 as to when he became aware of financial difficulties is not true as COVID-19 did not come into Australia until the first half of 2020.
6. As to the Applicant's response on the Additional Form at 3.3 stating that the directorship changed in 2019, the Respondent refers to an ASIC extract showing the other director ceased on 27 June 2016.
7. The Respondent contends that the Applicant's statements at 3.5 of the Additional Form (meeting with his accountant in or about October 2020 to discuss the financial affairs) are untrue as they are chronologically inconsistent. Meridian Property was placed into liquidation on 9 July 2020.
8. The Respondent contends that the underlying cause of Meridian Property's solvency issues was a lack of financial management, as opined in the Liquidator's Report at page 5 and stated in the Applicant's own evidence. The Respondent also contends that Meridian Property failed to pay a debt and meet a statutory demand, the Court accepted a petition and ordered liquidation. The Respondent contends that the Applicant has not detailed any genuine reasonable steps that he took to prevent Meridian Property's liquidation.

1. For s 33C(3)(b) to be made out the Tribunal must be satisfied that the Applicant took all reasonable steps to avoid the liquidation. Based on Poytress, the point at which the inquiry commences as to whether the Applicant took all reasonable steps to avoid liquidation is when the Applicant was "faced with the possibility" of insolvency or was "aware" or "should have been aware" of that possibility.
2. The Tribunal is satisfied on the basis of ASIC records of the following facts:

(1) The Applicant was a director of Meridian Property from April 2015.

(2) The other director ceased on 27 June 2016.

(3) Meridian Property was placed into Liquidation by Order of the Court on 9 July 2020.

1. As to when the Applicant was aware of the possibility of insolvency, the Tribunal finds the Applicant should have been aware prior to the service of the winding up application and then Court Order on 9 July 2020. This is because the Applicant's position is he was experiencing financial difficulties in 2019-20.
2. The Applicant's evidence of the facts and circumstances that led to the liquidation is inconsistent and unreliable. The Applicant makes a number of factual errors such as relying on the impacts of COVID-19 in 2019 before the pandemic commenced and the loss of his business partner and payment of $100,000 in 2018-19 when it was in fact the other director exited in 2016.
3. In any event the Tribunal is not concerned with the wisdom of financial dealings that ultimately ended in the liquidation. Rather, the Tribunal is concerned with what steps the Applicant took to avoid the liquidation once he became aware or should have been aware of the possibility.
4. The Tribunal is not satisfied that the Applicant took reasonable steps to avoid the liquidation. There is no Affidavit evidence about changing to house and land packages and the Applicant's submissions state this occurred in late 2018 and 2019, prior to when he was advised of financial difficulties by his accountant in late 2019. Further, there is no documentary evidence of the Applicant's wife injecting cash into the business.
5. The Applicant's position is that he met with his accountant in October 2020, but that post dates the Liquidation Order. At the hearing the Applicant contended that it must have been 2019. The Applicant attested to trying to enter into payment arrangements with subcontractors and not taking on new projects but did not provide documentary evidence. While attempting to enter into arrangements may be a reasonable step, the Tribunal has not been provided with particulars and gives this little weight.
6. In relation to the statutory demand for payment of $6,067, the Applicant could not recall or explain that he took any steps. When informed of the winding up application (which on re-examination the Applicant indicated may have occurred via his accountant), the Applicant did not recall taking any action.
7. Section 33C(3)(b) of the HBA is not made out.

Has the Applicant put in place sufficient risk mitigation measures?

1. The Applicant's evidence in his Affidavit of 17 June 2025 is that he has implemented several risk mitigation strategies in his new business to avoid any future risk of insolvency. These include regular financial management reviews with his accountant, use of MYOB with real-time bank feed monitoring to track cash flow and budgeting, revenue diversification through a range of building inspection services, lead generation through Jim's Building Group and contingency planning to respond promptly in the event of financial stress or economic downturn.

1. The Respondent's position is that the Applicant has not provided any risk mitigation measures other than to say that he does not propose to contract to do residential building work. In the Respondent's submission, this is not a genuine risk mitigation measure.

1. The Applicant must demonstrate that he has put in place sufficient risk mitigation measures to avoid a future liquidation.
2. While the measures outlined by the Applicant may be sufficient for a building inspection service, the Tribunal must be satisfied that the measures are sufficient for carrying out residential building work, for the reasons set out at [57] and following.
3. As set out at [59], by the Applicant's evidence, aside from the car and franchise of the new business, he has no assets and has not demonstrated that he has the financial means to undertake residential building work, including to purchase the necessary tools and equipment.
4. The Applicant has not demonstrated that he has put in place sufficient risk mitigation measures to avoid a future liquidation.

1. For the reasons set out above the Tribunal finds that s 33B and s 33C(3) of the HBA are not made out. As the Tribunal is not satisfied that the Applicant fulfills the requirements, the correct and preferable decision is to refuse the application for a contractor licence.

(1) The decision of the Respondent to refuse the contractor licence is affirmed.

I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales.

27 February 2026 - Amendment to formatting of the reference in paragraph 100 which refers to paragraph 57.