BETWEEN : REAL ESTATE AND BUSINESS AGENTS SUPERVISORY BOARD

Jurisdiction : STATE ADMINISTRATIVE TRIBUNAL OF WESTERN AUSTRALIA

Citation : REAL ESTATE AND BUSINESS AGENTS SUPERVISORY BOARD and LANDA [2008] WASAT 114

Vocational regulation - Real estate agent - Breaches of Real Estate and Business Agents Act 1978 (WA) and Code of Conduct - Power to impose global penalty - Whether penalties manifestly inadequate

Interpretation Act 1984 (WA), s 10(c)

Migration Act 1958 (Cth), s 430(1)

Real Estate and Business Agents Act 1978 (WA), s 26, s 27, s 30(1), s 31, s 64(1), s 101, s 102, s 103

Sentencing Act 1995 (WA), s 6, s 39, s 88

Settlement Agents Act 1981 (WA), s 84

State Administrative Tribunal Act 2004 (WA), s 77, s 105(1), s 105(13)

Cancellation of licence and certificate and disqualification for 2 years

Appellant : Real Estate and Business Agents Supervisory Board

Abebe v Commonwealth [1999] HCA 14; (1999) 197 CLR 510

Dinsdale v The Queen [2000] HCA 54; (2000) 202 CLR 321

Griffiths v The Queen [1977] HCA 44; (1977) 137 CLR 293

Haywood v Roadknight [1927] VicLawRp 74; [1927] VLR 512

Hickey v Donnelly [1971] WAR 153

House v The King [1936] HCA 40; (1936) 55 CLR 499

Jemielita v The Medical Board of Western Australia (Unreported, WASC, Library No 920584, 13 November 1992)

McPherson v Watt (1877) 3 App Cas 254

Minister for Immigration and Multicultural Affairs v Yusuf [2001] HCA 30; (2001) 206 CLR 323

Paridis v Settlement Agents Supervisory Board [2007] WASCA 97

Thomas v The Medical Board of Western Australia [2005] WASC 244

1 McLURE JA: I agree with Pullin JA in relation to grounds of appeal 2, 3 and 4. I differ from him in relation to ground of appeal 5 and propose to state my own views on ground 1.

2 The factual background is set out in the reasons of Pullin JA and not repeated here. It is sufficient for present purposes to note that the respondent, a licensed real estate agent, was reprimanded and fined by the State Administrative Tribunal (the Tribunal) for eight breaches of the Real Estate and Business Agents Act 1978 (WA) (the Act) or the Code of Conduct for Agents and Sales Representatives prescribed pursuant to s 101 of the Act (the Code). The eight breaches related to two unrelated transactions referred to as the Devine transaction and the Flynn transaction.

3 In its application to the Tribunal, the appellant, the Real Estate and Business Agents Supervisory Board (the Board) alleged that 'there is proper cause for disciplinary action as defined in s 103 of the ... Act against the [r]espondent in the circumstances particularised in respect of each and all of the allegations set out herein'. Ten allegations were particularised. The orders sought by the Board in its application were a fine not exceeding $10,000 and an order suspending or cancelling the respondent's licence and any triennial certificate in respect thereof and, in addition disqualification, either temporarily or permanently or until the fulfilment of any condition which may be imposed by the Tribunal, from holding a licence or triennial certificate or both.

4 Thus the Board sought a global penalty for the breaches as a whole. However, the Tribunal imposed a separate penalty for each proven breach. In respect of six of the eight breaches the Board imposed both a reprimand and a fine and for two breaches imposed a reprimand only.

5 A person is prohibited from carrying on business as a real estate agent unless he or she is licensed as such under the Act and holds a current triennial certificate in respect of the licence (s 26).

6 The Board is required to grant a licence to a natural person if it is satisfied of certain conditions (s 27(1)) including that:

(b) he is a person of good character and repute and a fit and proper person to hold a licence;

...

(d) he understands fully the duties and obligations imposed by this Act on agents.

7 A licence is continuous (s 30(1)). On the grant of a licence, the Board is required to grant the licensee a certificate which confers on the licensee the right to carry on business as an agent for three years (s 31(1)). A triennial certificate may be renewed for subsequent periods of three years on certain conditions (s 31(2)). However, the Board may refuse to renew a licensee's triennial certificate if the Board is satisfied that s 27(1)(b), (c) or (d) no longer applies (s 31(3)).

8 Part VII of the Act deals with the discipline of agents. The Board may allege to the Tribunal that there is proper cause for disciplinary action against an agent (s 102(1)). Section 103 is central to the disposition of this appeal. It relevantly provides:

(1) If, in a proceeding commenced by an allegation under section 102(1) against an agent, the State Administrative Tribunal is satisfied that proper cause exists for disciplinary action, the State Administrative Tribunal may do any one or more of the following things -

(a) reprimand or caution the agent;

(b) impose a fine not exceeding $10 000 on him;

(c) suspend or cancel his licence and any triennial certificate in respect thereof and in addition, disqualify him either temporarily or permanently, or until the fulfilment of any condition which may be imposed by the State Administrative Tribunal, from holding a licence or triennial certificate, or both;

(d) where the State Administrative Tribunal is satisfied that the agent is acting or has acted in breach of section 60(3), 61(5) or 64(4) (the subsection) -

(i) order the agent to pay to a person specified by the State Administrative Tribunal the whole or part of any commission, reward or other valuable consideration received or held in contravention of a provision referred to in the subsection;

(ii) order that a demand by the agent in contravention of a provision referred to in the subsection for the whole or part of any commission, reward or other valuable consideration not be made, or if made, be withdrawn or varied in accordance with the order;

(e) where the State Administrative Tribunal is satisfied that the agent is acting or has acted in breach of section 64(1), order the agent to pay to the agent's principal any profit that the agent has made, or is, in the opinion of the State Administrative Tribunal, likely to make from the transaction.

(2) There shall be proper cause for disciplinary action against an agent if -

(a) the agent improperly obtained a licence or triennial certificate;

(b) the agent, or any person acting with the authority or upon the instructions of the agent has in the course of any dealings with a party, or a prospective party, to a transaction, been guilty of conduct that constitutes a breach of any law other than this Act and that prejudices or may prejudice any rights or interests of the party, or prospective party to the transaction;

(c) the agent is acting or has acted in breach of -

(i) a special condition of his licence or triennial certificate;

(ii) the requirements of this Act; or

(iii) the agents code of conduct;

or

(d) any other cause exists that, in the opinion of the State Administrative Tribunal, renders the agent unfit to hold a licence.

The Tribunal erred in law in the construction of sub-section 103(1) of the ... Act insofar as it imposed individual disciplinary action in respect of each breach of that Act or the Code ... whereas the sub-section requires the Tribunal to impose disciplinary action which as a whole reflects the purpose of the sub-section to provide protection of the public and maintain proper professional standards.

10 The ground of appeal fails to precisely identify the error complained of. The written submissions do little to advance the position. Based on the oral submissions, I understand the Board's contentions to be as follows:

(a) on a proper construction of s 103 of the Act, the Tribunal had the power to:

(i) impose separate penalties for each proven allegation (each proven allegation itself being a proper cause for disciplinary action for the purposes of s 103(1)); or

(ii) impose a single or global penalty for all (or I infer two or more) of the proven allegations;

(b) regardless of whether the Board imposed separate penalties or a global penalty, the Tribunal was obliged to consider the proven allegations as a whole and impose a penalty (or penalties) proportionate to the conduct as a whole.

11 Thus, the Board does not contend that the Tribunal erred in imposing separate penalties rather than a global penalty. The gravamen of its complaint is that the Tribunal failed to consider the proven allegations as a whole in determining whether or not to suspend or cancel the respondent's licence and triennial certificate.

12 Against that background, I turn to the Tribunal's reasons on this issue. The Tribunal said:

1. It is accepted by both counsel for the Board and the agent that the Tribunal has the power under the ... Act to impose a fine in respect of each of the separate allegations or findings of misconduct (disciplinary offences) made against the agent, and that the Tribunal is not limited to imposing a single 'global' fine in respect of the first set of allegations in respect of the Devine transaction and a single or 'global' fine in respect of the second set of disciplinary offence allegations in respect of the Flynn transaction. The Tribunal considers this to be correct.
2. The issue as to whether or not the Tribunal would commit an error in imposing a single penalty for a number of offences, rather than separate and discrete penalties for each offence, was mentioned in Paridis v Settlement Agents Supervisory Board [2007] WASCA 97 (Paridis). Buss JA (with whom Wheeler JA and Pullin JA agreed) questioned whether it would be an error for the Tribunal to impose a 'global order' instead of separate and discrete penalties for each offence, in exercising its disciplinary powers under s 84(1) of the Settlement [Agents] Act 1981 (WA). That provision is in identical or quite similar terms to s 103 of the ... Act.

1. In the view of this Tribunal, the question in each case where a disciplinary offence is found against an affected person, is what disciplinary outcome is appropriate in respect of that finding. Thus, on the face of it, separate and distinct penalties in respect of each offence would ordinarily, logically, be expected. However, in some cases, because a number of offences might relate to the same dealing or transaction, or otherwise overlap, the appropriate penalty in respect of some offences might be imposed having regard to the penalty imposed in respect of what might be considered in the circumstances of the case, the lead or primary offence. The Tribunal is entitled, in an appropriate case, to have regard to the extent to which particular findings relate to a common transaction. The Tribunal is also entitled, in its discretion, to regard whether the effect of the penalties, in aggregate, is proportionate to the extent of wrongdoing or misconduct identified by the offences. In these senses, a 'global' penalty may be seen as relevant, but only at the end of the penalty assessment process. In the Tribunal's view, to approach the question of penalty where there are a number of findings on the basis of what seems to be the appropriate 'global' order without first considering the discrete possible penalties, would constitute a failure to exercise the power to impose a penalty in the correct manner.
2. That this is the right approach is also suggested by the observations made by Owen J in Jemielita ...
3. As indicated, the Tribunal does not doubt that the proper approach is to consider what penalties are appropriate in respect of each disciplinary offence, but bearing in mind the extent to which the offences relate to one dealing or transaction and reveal, as it were, distinct acts of wrongdoing or misconduct; as well as taking into account the overall appropriateness of the penalty outcome in respect of the various findings made.
4. The Tribunal notes, however, that the position in some proceedings may require a different approach where there is but a single allegation which is supported by particulars of numerous cases of misconduct, incompetence or whatever. In such a case, if the allegation is made out, it would not be open to impose separate penalties to each particular wrongful act, but rather appropriate to impose a single penalty for the offence found.

13 It is apparent from [169] of the Tribunal's reasons that it did consider the proven allegations as a whole in determining whether it should make an order for suspension. The Tribunal said:

Nonetheless, the question here is whether, in all of the circumstances of the two cases, and the fact that there have been two important transgressions from duties owed by him as agent to his principals, a period of suspension of the agent from practice as a real estate agent is called for. In the event, while the Tribunal is of the view that the starting assumption is that at least a period of suspension would ordinarily be called for here, having regard to the fact that, in the Devine transaction, the agent readily admitted his guilt and refunded the commission; and in the Flynn transaction the dealing did not proceed to settlement once the complaint concerning his involvement in the transaction was brought to light, the Tribunal considers the interests of the public in being protected against sharp practices by the agent, and in ensuring professional standards are maintained, may be met by the imposition of appropriate reprimands and fines.

14 On my reading of the Tribunal's reasons (particularly [152]), it accepts that the Tribunal has power in appropriate circumstances to impose a global penalty in respect of multiple (separate) proper causes for disciplinary action but should not impose a global penalty before considering the appropriate penalty for each separate breach. Further, the Tribunal considered the totality of the proven breaches and concluded that it was unnecessary to suspend or cancel the respondent's licence and triennial certificate. That is sufficient to dispose of ground of appeal 1 without determining whether the Tribunal was correct to conclude that it has the power to impose a global penalty for two or more separate matters constituting a proper cause for disciplinary action. However, it is necessary to address the issue in view of my conclusion on ground 5 and the resulting need to re-sentence.

15 Although the issue is one of statutory construction of the Act, I propose to mention some further background. The Tribunal suggests its approach is consistent with that of Owen J (as he then was) in Jemielita v The Medical Board of Western Australia (Unreported, WASC, Library No 920584, 13 November 1992), which was an appeal from a decision of the Medical Board. The Medical Board had found a medical practitioner guilty of six disciplinary charges and, without giving reasons, ordered a single or global penalty, being that the practitioner's name be removed from the register. Owen J was critical of the Medical Board's failure to give reasons but did not expressly consider or determine whether the Medical Board had the power to impose a global penalty. However, because several of the findings on which the global penalty was based had not survived on appeal, Owen J was required to revisit the question of penalty. In re-sentencing, he imposed separate penalties for each charge. When considering the penalty for two separate charges relating to obstetrics, he noted that a fine or reprimand would be appropriate if the charges were looked at individually but that when considered together, they indicated impatience and poor judgment which justified a period of suspension on each charge. Thus, the factual inference arising from the multiple charges (but not the facts of the offences themselves) increased the seriousness of both. However, there is nothing in Owen J's reasons or in principle that requires the appropriate stand-alone penalty to first be identified.

16 After Owen J's decision in Jemielita, the Medical Board adopted the approach of identifying the appropriate penalty for each separate episode of misconduct viewed in isolation and then considering all of the conduct in its totality. The Medical Board would impose a global penalty for multiple breaches if that was required to meet the statutory objectives (protection of the public and maintenance of professional standards). The validity of this approach was upheld by Hasluck J in Thomas v The Medical Board of Western Australia [2005] WASC 244. It bears a striking similarity to the principles stated by the Tribunal in this case.

17 The influence of criminal law sentencing concepts is also evident in the Medical Board's approach in Thomas. The general common law rule is that a separate sentence has to be imposed for each proven criminal offence. There may be exceptions to that general rule permitting a court to impose a single or global penalty for multiple offences (see Warner K, 'General Sentences' (1987) 11 Criminal Law Journal 335, 337 - 339). Further, the general common law rule is that, subject to exceptions for certain types of offences, multiple sentences of imprisonment be served concurrently. The reverse is true for fines, which are accumulated. Of course, the Sentencing Act 1995 (WA) regulates such matters in this State (s 6, s 39, s 88). Under that Act, the court is obliged to impose a separate sentence for each offence, with no double punishment for common elements. However, when sentencing for multiple offences, the court is required to determine the appropriate total effective sentence having regard to the total criminality of the criminal conduct as a whole. This is an aspect of the 'totality principle'. To that end, the court is given the power to order total or partial cumulation of terms of imprisonment.

18 Although there is nothing to suggest that the common law of sentencing for criminal offences is the palimpsest against which s 103 of the Act is to be construed, some of the principles (including totality and no double penalty) would apply subject to any necessary modification attributable to the different objectives.

19 The starting point on the construction issue is whether par (d) of s 103(2) is intended to be the sole source of any power to impose a global penalty for multiple statutory breaches. That raises for consideration the scope of par (d) of s 103(2).

20 Prima facie, the word 'other' in par (d) means other than the causes specified in pars (a) to (c) of s 103(2). However, it is unnecessary to determine whether individual causes under par (a) - (c) can form the factual foundation for a single proper cause under par (d). Assuming without deciding that they can, par (d) is very confined in its scope. In effect it requires proof of conduct that would, having regard to s 27 of the Act, require or at least justify cancellation of the licence and associated triennial certificate. Thus, it would not permit a global penalty if the conduct as a whole only justified suspension. The significance of that is amplified if, as in my view is the case, the Tribunal does not have the power to order cumulation of periods of suspension imposed for separate statutory causes. It is difficult to see why, if a global penalty is permissible, it would be limited to the circumstances in par (d).

21 In the absence of a power to accumulate, the power to impose a global penalty provides the flexibility necessary to further the statutory objective of protecting the interests of the public. For example, if the appropriate penalty for each multiple breach considered alone was a suspension of 3 months but the total conduct required a suspension of say 6 months, that could not be achieved unless a global penalty could be imposed or (as in Jemielita) there were proper grounds in principle to increase the individual periods of suspension.

22 I am satisfied that the natural and ordinary meaning of the text of s 103(1) of the Act is consistent with the Tribunal having the power to order a global penalty for two or more proper causes for disciplinary action. By s 10(c) of the Interpretation Act 1984 (WA), in any written law, words in the singular number include the plural. There being no contrary legislative intent, the word 'cause' in s 102(1)(a) and s 103(1) means 'cause or causes' thus empowering the imposition of a global penalty. However, I see no requirement that the Tribunal first determine the appropriate separate penalty in isolation before doing so.

24 The Board contends that 'the disciplinary action imposed by the Tribunal overall is manifestly inadequate'. I agree.

25 The imposition of a manifestly inadequate penalty constitutes an implied error of law. A disciplinary order will be manifestly inadequate if it is plainly unreasonable or unjust. By imposing penalties at the bottom end of the scale, the Tribunal in my respectful opinion grossly underestimated the seriousness of certain aspects of the respondent's conduct.

26 I start with the Devine transaction. The Devines retained the respondent to act for them in the sale of their Mirrabooka property (the property). The first four breaches relate to the sale of the property to a purchaser who, unbeknown to the vendors, was the respondent's wife. The respondent took active steps to hide his relationship with the purchaser by using her maiden name and giving an incorrect residential address. The respondent's wife purchased the property for $15,000 less than the vendors' asking price and the vendors paid the respondent a commission of $7,300.

27 The respondent admitted the first four allegations and repaid the commission to the Devines. The first four individual breaches are closely intertwined. They are manifestations of the respondent's calculated breach of his duty of loyalty. The misconduct strikes at the very heart of the fiduciary relationship between a real estate agent and his or her client. The serious level of culpability stems from the respondent's use of deception concerning his relationship with the purchaser (allegation 4) which is linked with his failure to obtain his clients' prior written consent (allegation 1) and the purpose of the deception, which was to advance the financial interests of himself and his family which was not in the best interests of his clients (allegations 2 and 3). In view of his prior breaches for which he had been disciplined by the Board in 2002, it cannot be said the respondent was ignorant of his duties as an agent.

28 The purpose of disciplinary proceedings is not to punish the agent but to protect the public and maintain proper professional standards. The respondent's conduct the subject of allegations 1 to 4 constitutes a very serious departure from the fundamental obligations owed by an agent. The close connection between the allegations, factually and in assessing culpability, justifies a global penalty. Both personal and general deterrence are weighty considerations in this case. I agree with Pullin JA that the only appropriate course is the cancellation of the respondent's licence and triennial certificate. The use of calculated deception for an improper purpose in the carrying out of his duties as an agent demonstrates that the respondent is unfit to hold a licence.

29 It is also necessary to determine whether to disqualify the respondent temporarily or permanently from holding a licence and/or the associated triennial certificate. The type and period of disqualification determines whether, and if so when, the respondent can re-apply for a licence and triennial certificate. Having regard to all relevant factors, including his plea of guilty and repayment of the deposit, permanent disqualification is not justified. I would disqualify him from holding a licence and triennial certificate for 2 years following which he will have to satisfy the Board that he fulfils the requirements of s 27 of the Act.

30 I am not persuaded that the other penalties are manifestly inadequate or that they should be dealt with globally. That is, I would not interfere with the disciplinary orders made by the Tribunal in respect of allegations 5 and 6 in the Devine transaction and 7 and 9 in the Flynn transaction. I would hear from the parties as to the appropriate orders.

31 PULLIN JA: This is an appeal from orders made pursuant to s 103(1) of the Real Estate and Business Agents Act 1978 (WA) (REBA Act) by the State Administrative Tribunal reprimanding and fining the respondent in relation to eight breaches of the REBA Act or the Code of Conduct for Agents and Sales Representatives (Code).

32 The appeal is brought pursuant to s 105(1) of the State Administrative Tribunal Act 2004 (WA) (SAT Act). An appeal may only be brought on a question of law and only if this court grants leave. The right to appeal on a question of fact as well as questions of law under s 105(13) of the SAT Act does not apply to the appellant (Paridis v Settlement Agents Supervisory Board [2007] WASCA 97 [51]). The application for leave was heard at the same time as the appeal. There is no dispute that the appellant's grounds raise questions of law.

33 In deciding whether to grant leave, the court will usually take into account the importance of the question of law, whether the decision is attended by sufficient doubt and whether there would be substantial injustice if the decision was not reversed. See Paridis [16] - [18]. In my opinion, all grounds except grounds 2 and 4 raise questions of law of sufficient importance to warrant the grant of leave to appeal. The reasons for refusing leave in relation to grounds 2 and 4 appear below.

34 The eight allegations of breaches made by the appellant and found by the tribunal to have occurred were in relation to two properties owned by people for whom the respondent had been appointed agent. The allegations were:

1. IT IS ALLEGED that the Respondent as an agent under the Act had an interest otherwise than in his capacity as an agent in a transaction in which he acted as an agent, namely, the sale of the Mirrabooka Property from DEVINE to KOVALIOVA, without the prior written consent of his principal, contrary to section 64(1) of the Act.

1. IT IS ALLEGED that the Respondent as an agent received a reward (commission) in relation to a transaction in respect of which he had an interest in contravention of section 64 of the Act, namely, the sale of the Mirrabooka Property from DEVINE to KIOVALIOVA, contrary to section 64(4) of the Act.

1. IT IS ALLEGED that the Respondent as an agent failed to act in the best interests of his principal in the sale of the Mirrabooka Property from DEVINE to KOVALIOVA contrary to article 2 of the Code of Conduct for Agents and Sales Representatives ('the Code').

1. IT IS ALLEGED that the Respondent as an agent, knowingly misled or deceived the vendors as parties to a transaction, namely, the sale of the Mirrabooka Property from DEVINE to KOVALIOVA contrary to article 5(2) of the Code.

1. IT IS ALLEGED that the Respondent as an agent failed to act in the best interests of his principal in the rental of the Mirrabooka Property from DEVINE to LANDA and FIRINSHTEIN prior to settlement and sale of the property, contrary to article 7 of the Code.

1. IT IS ALLEGED that the Respondent as an agent failed to exercise skill, care and diligence in the rental of the Mirrabooka Property from DEVINE to LANDA and FIRINSHTEIN contrary to article 7 of the Code.

1. IT IS ALLEGED that the Respondent as an agent under the Act had an interest otherwise than in his capacity as an agent in a transaction in which he acted as an agent, namely, the negotiation of the sale of the Ballajura Property from FLYNN to IRINA VLADIMIROVNA LANDA, without the prior written consent of his principal contrary to section 64(1) of the Act.

1. IT IS ALLEGED that the Respondent as an agent failed to act in the best interests of his principal in his negotiation of the sale of the Ballajura Property from FLYNN to IRINA VLADIMIROVNA LANDA, contrary to article 2 of the Code.

35 Two other allegations, numbered 8 and 10, concerning the Ballajura property, were not proven.

Facts in relation to the Devine transaction

36 In 2005, Mr and Mrs Devine were the registered proprietors of a property in Mirrabooka. In April 2005, the Devines entered into a selling agency agreement with the respondent to sell their property for a price of $240,000. The agreement made provision for the payment of commission of $8,300. The respondent obtained an offer from S to purchase the property for $240,000. The offer was subject to finance. The offer was accepted by the Devines. S was an investor intending to rent out the property. The respondent then suggested to the parties to the transaction that his parents and grandmother would be suitable tenants to occupy the property. The respondent then wrote out a lease agreement for a periodic lease of the property to his relatives at a weekly rental and which provided for the tenants to pay a bond and two weeks' rent in advance. They did not pay the bond. The Devines signed the lease on 4 May 2005. Not long afterwards, the contract of sale to S foundered because the application for finance was rejected. The respondent advised the Devines of this.

37 In June 2005, the respondent obtained an offer from a Mrs C to purchase the property for $238,000. The offer was accepted by the Devines. Eventually, the Devines instructed the respondent to issue a 48 hour notice ending the contract and this happened.

38 An offer was then obtained from a Mr and Mrs S to purchase the property for $236,000. However, this also failed to proceed because of non-satisfaction of a finance condition.

39 In August 2005, the Devines wrote to the respondent instructing him to issue a 60 day notice requiring the tenants to vacate the property. On 12 August 2005, within a few days of the respondent receiving those instructions, he presented to the Devines a cash offer of $225,000 from a person described as 'Irina Vladimirovna Kovaliova of 7 Woodbine Terrace, Mirrabooka'. On 13 August 2005 the Devines accepted the offer. The respondent did not inform the Devines that Kovaliova was the respondent's wife; that Kovaliova was her maiden name; and that he had an interest in the transaction apart from the interest he had as an agent. He did not obtain from them, as required by the REBA Act, their prior written consent to his adverse interest in the transaction. Furthermore, he did not inform them that no commission was payable given his adverse interest in the transaction, unless they consented. The respondent knew that Kovaliova's address was not correct and that she resided with him at Fairview Place, the address at which he conducted his business. He withheld the information from the Devines to hide the true relationship he had with the buyer.

40 In September 2006, the respondent witnessed his wife's signature on a transfer of land document. The transaction then settled and the Devines instructed their settlement agent to pay a commission of $7,300 from the proceeds of sale to the respondent. The funds used to settle the purchase of the transaction came from a joint mortgage facility in the names of the respondent and his wife. Subsequently, when the deception came to light, the agent refunded the commission to the Devines.

41 The agent admitted the first four allegations against him. The tribunal found that the allegations in relation to allegations 5 and 6 were also made out.

42 Mr Flynn was a semi-retired painter who owned the Ballajura property. The Ballajura property was an under-developed vacant block that had subdivision potential. Mr Flynn had been approached by several real estate agents about selling the land but had resisted those approaches. One of the agents approaching Mr Flynn was the respondent.

43 On 5 January 2006, the respondent presented to Mr Flynn an offer by his wife to purchase the land for $250,000. The tribunal found that Mr Flynn had mentioned the sum of $250,000 to the respondent as a price at which he would consider selling. Conditions were added in handwriting and initialled by Mr Flynn, including a condition that Mr Flynn was aware that the respondent was related to the purchaser.

44 Sometime after accepting the offer and after Mr Flynn received a stamped transfer of land document with a request that he sign it, Mr Flynn sought legal advice. His solicitors wrote a letter to the respondent's wife which stated, in effect, that the contract had been induced by undue influence and in circumstances where the respondent had a conflict of interest.

45 The tribunal found that although there was a provision inserted into the offer about Mr Flynn's awareness that the respondent was related to the purchaser, the clause did not constitute the obtaining of 'prior written consent' in accordance with s 64(1) of the REBA Act and that allegation 7 was made out.

46 The tribunal also found that allegation 9 was proven. The tribunal held that the respondent failed to act in the best interests of Mr Flynn in his negotiation of a sale of the Ballajura property contrary to article 2 of the Code. The facts establishing this were that the respondent failed to test the market and there was no attempt made by the respondent other than to prefer the interests of his family in obtaining a quick purchase. The terms of the sale were highly advantageous to the purchaser in that it was a cash sale with settlement due more than six months after the date of the contract, with nothing built into the contract to take into account any movement in the market.

The tribunal's reasons for the orders made under s 103(1)

47 The tribunal made the following observations before ordering reprimands and the payment of fines:

It is accepted by both counsel for the Board and the agent that the Tribunal has the power under the REBA Act to impose a fine in respect of each of the separate allegations or findings of misconduct (disciplinary offences) made against the agent, and that the Tribunal is not limited to imposing a single 'global' fine in respect of the first set of allegations in respect of the Devine transaction and a single or 'global' fine in respect of the second set of disciplinary offence allegations in respect of the Flynn transaction. The Tribunal considers this to be correct.

The issue as to whether or not the Tribunal would commit an error in imposing a single penalty for a number of offences, rather than separate and discrete penalties for each offence, was mentioned in Paridis v Settlement Agents Supervisory Board [2007] WASCA 97 (Paridis). Buss JA (with whom Wheeler JA and Pullin JA agreed) questioned whether it would be an error for the Tribunal to impose a 'global order' instead of separate and discrete penalties for each offence, in exercising its disciplinary powers under s 84(1) of the Settlement Agent's Act 1981 (WA). That provision is in identical or quite similar terms to s 103 of the REBA Act.

While not finding it necessary to resolve the issue in that case, Buss JA, at [22], noted the observations of Owen J in Jemielita v the Medical Board of Western Australia (unreported, WASC, Library No 920584, 13 November 1992) (Jemielita) at 137 ­ 140, in the context of s 13 of the Medical Act 1984 (WA), and the approach of the Tribunal in Settlement Agents Supervisory Board and Strand Settlements Pty Ltd [2005] WASAT 350.

In the view of this Tribunal, the question in each case where a disciplinary offence is found against an affected person, is what disciplinary outcome is appropriate in respect of that finding. Thus, on the face of it, separate and distinct penalties in respect of each offence would ordinarily, logically, be expected. However, in some cases, because a number of offences might relate to the same dealing or transaction, or otherwise overlap, the appropriate penalty in respect of some offences might be imposed having regard to the penalty imposed in respect of what might be considered in the circumstances of the case, the lead or primary offence. The Tribunal is entitled, in an appropriate case, to have regard to the extent to which particular findings relate to a common transaction. The Tribunal is also entitled, in its discretion, to regard whether the effect of the penalties, in aggregate, is proportionate to the extent of wrongdoing or misconduct identified by the offences. In these senses, a 'global' penalty may be seen as relevant, but only at the end of the penalty assessment process. In the Tribunal's view, to approach the question of penalty where there are a number of findings on the basis of what seems to be the appropriate 'global' order without first considering the discrete possible penalties, would constitute a failure to exercise the power to impose a penalty in the correct manner.

That this is the right approach is also suggested by the observations made by Owen J in Jemielita. In Jemielita the Medical Board had imposed a variety of penalties, including removal of the practitioner's name from the register. Owen J, at 142, noted that the most severe penalty of removal of name from the register had been imposed by the Board without differentiating between the six charges it had found were made out. His Honour said that the Board gave no indication, by imposing this single penalty, as to the reasoning process which drove it to the conclusion that striking off was the appropriate disposition. This had left the court in a position, on appeal, where it was necessary to engage in a process of speculation to ascertain what motivated the Board to do so and whether there had been an error in the process. His Honour further pointed out that given the Board retained the power, subsequently, to restore the practitioner's name to the register in appropriate circumstances after striking him off, it would always remain useful for a later Board to understand what the process of reasoning had earlier been if a restoration application were later to be considered.

As indicated, the Tribunal does not doubt that the proper approach is to consider what penalties are appropriate in respect of each disciplinary offence, but bearing in mind the extent to which the offences relate to one dealing or transaction and reveal, as it were, distinct acts of wrongdoing or misconduct; as well as taking into account the overall appropriateness of the penalty outcome in respect of the various findings made.

The Tribunal notes, however, that the position in some proceedings may require a different approach where there is but a single allegation which is supported by particulars of numerous cases of misconduct, incompetence or whatever. In such a case, if the allegation is made out, it would not be open to impose separate penalties to each particular wrongful act, but rather appropriate to impose a single penalty for the offence found [149] - [155].

48 The tribunal correctly stated that the purpose of a vocational disciplinary order is:

[T]o ensure that the public is appropriately protected and proper professional standards are maintained. The maintenance of proper professional standards is conducive to the protection of the public. Disciplinary proceedings are not designed to punish the person affected [156].

49 The tribunal concluded that the most serious findings made against the respondent in relation to the Devine transaction, related to the first four allegations. The tribunal found that the respondent 'consciously went out of his way to prefer his own interest to those of his principal' and that he:

[T]ook advantage of the inability of the principal to obtain an enforceable sale of the property by making a cash offer pitched at a price that he believed the principal would be very likely to accept, and which the principal did accept [157].

The tribunal found that the respondent 'concealed the relationship between himself and the purchaser' who was his wife, and achieved this by using his wife's maiden name, a different address and he claimed and received a commission following the settlement of the sale [157]. The tribunal also found that 'the principal did not have the opportunity to consider whether the offer of $225,000 was truly a market offer, and whether or not a better offer could be elicited' [158].

50 The tribunal then asked itself why a period of suspension or disqualification from practice should not be imposed. The tribunal said that the public was 'entitled to have confidence that real estate agents they deal with will not have a propensity to prefer their own interests to those of the principal' and that maintenance of professional standards helps to give the public confidence that their agent will act for them strictly in conformity with the law and the industry code of conduct [159]. The tribunal noted that when confronted with this misconduct, the respondent accepted he had 'acted wrongly and refunded the commission he had received without debate' [161]. The tribunal noted at [162] that the events of the Devine transaction were followed reasonably soon after by those of the Flynn transaction, although they were not discovered by the Board until later. In this case, the tribunal held at [163] that the respondent was keen for his own or his family's purposes to acquire the property of Mr Flynn because of its subdivisional potential; that at no time did he put the property to the market; and that he was intent on buying the property for his own family.

[H]aving regard to these two transactions and the findings made in respect of them, that the agent does not fully appreciate the extent of these duties. He seems to think that so long as he is not acting out of personal greed, deviation from his direct duties can be justified. It cannot be.

Nonetheless, the question here is whether, in all of the circumstances of the two cases, and the fact that there have been two important transgressions from duties owed by him as agent to his principals, a period of suspension of the agent from practice as a real estate agent is called for. In the event, while the Tribunal is of the view that the starting assumption is that at least a period of suspension would ordinarily be called for here, having regard to the fact that, in the Devine transaction, the agent readily admitted his guilt and refunded the commission; and in the Flynn transaction the dealing did not proceed to settlement once the complaint concerning his involvement in the transaction was brought to light, the Tribunal considers the interests of the public in being protected against sharp practices by the agent, and in ensuring professional standards are maintained, may be met by the imposition of appropriate reprimands and fines [168] - [169].

52 The tribunal made orders in relation to the allegations which had been proven as follows:

• Allegation 1: A reprimand and a fine of $8,000.
• Allegation 2: A reprimand and a fine of $5,000.
• Allegation 3: A reprimand and a fine of $1,000.
• Allegation 4: A reprimand and a fine of $1,000.
• Allegation 5: Reprimand.
• Allegation 6: Reprimand.

• Allegation 7: A reprimand and fine of $5,000.
• Allegation 9: A reprimand and fine of $3,000.

1. The Tribunal erred in law in the construction of sub-section 103(1) of the Real Estate and Business Agents Act 1978 in so far as it imposed individual disciplinary action in respect of each breach of that Act or the Code of Conduct for Agents and Sales Representatives whereas the sub-section requires the Tribunal to impose disciplinary action which as a whole reflects the purpose of the sub-section to provide protection of the public and maintain proper professional standards.

1. The Tribunal erred in law in that it failed to take into account material considerations being the contemporaneous nature of the breaches, their consistency and the Respondent's motivation to benefit his family against the interest of his principals.

1. The Tribunal erred in law in that it failed to take into account a material consideration namely the prior breaches by the Respondent of the Real Estate and Business Agents Act 1978 and Code of Conduct for Agents and Sales Representatives of a similar nature and gave no reasons for such failure.

1. The Tribunal erred in law in that it allowed irrelevant material to guide its decision, namely matters personal to the Respondent such as his admissions of guilt, repayment of monies and withdrawal of a transaction after the complaint was made.

1. The disciplinary action imposed by the Tribunal overall is manifestly inadequate.

54 The relevant provisions of the REBA Act are as follows:

The Board may from time to time prescribe, and publish in the manner prescribed by the regulations -

(a) a code of conduct for agents; and

(b) a code of conduct for sales representatives.

1. Inquiries into conduct of agents and sales representatives

(1) The Board may allege to the State Administrative Tribunal that -

(a) there is proper cause for disciplinary action, as mentioned in section 103(2), against an agent; ... or

1. Disciplinary action, grounds for and forms of

(1) If, in a proceeding commenced by an allegation under section 102(1) against an agent, the State Administrative Tribunal is satisfied that proper cause exists for disciplinary action, the State Administrative Tribunal may do any one or more of the following things -

(a) reprimand or caution the agent;

(b) impose a fine not exceeding $10 000 on him;

(c) suspend or cancel his licence and any triennial certificate in respect thereof and in addition, disqualify him either temporarily or permanently, or until the fulfilment of any condition which may be imposed by the State Administrative Tribunal, from holding a licence or triennial certificate, or both;

(d) where the State Administrative Tribunal is satisfied that the agent is acting or has acted in breach of section 60(3), 61(5) or 64(4) (the 'subsection') -

(i) order the agent to pay to a person specified by the State Administrative Tribunal the whole or part of any commission, reward or other valuable consideration received or held in contravention of a provision referred to in the subsection;

(ii) order that a demand by the agent in contravention of a provision referred to in the subsection for the whole or part of any commission, reward or other valuable consideration not be made, or if made, be withdrawn or varied in accordance with the order;

(e) where the State Administrative Tribunal is satisfied that the agent is acting or has acted in breach of section 64(1), order the agent to pay to the agent's principal any profit that the agent has made, or is, in the opinion of the State Administrative Tribunal, likely to make from the transaction.

(2) There shall be proper cause for disciplinary action against an agent if -

(a) the agent improperly obtained a licence or triennial certificate;

(b) the agent, or any person acting with the authority or upon the instructions of the agent has in the course of any dealings with a party, or a prospective party, to a transaction, been guilty of conduct that constitutes a breach of any law other than this Act and that prejudices or may prejudice any rights or interests of the party, or prospective party to the transaction;

(c) the agent is acting or has acted in breach of -

(i) a special condition of his licence or triennial certificate;

(d) any other cause exists that, in the opinion of the State Administrative Tribunal, renders the agent unfit to hold a licence.

55 It is also relevant for reasons which will become apparent, that s 27 provides that a person applying to the board for a licence and paying the prescribed fee:

[S]hall be granted and may hold a licence if the Board is satisfied that:

(a) ...

(b) he is a person of good character and repute and a fit and proper person to hold a licence;

(c) ...

(d) ...

56 Although ground 1 alleges an error of law in the construction of s 103(1) of the Act, counsel for the appellant during oral submissions made it clear that the appellant did not contend that as a matter of construction s 103(1) obliged the tribunal to impose a 'global' penalty (meaning one penalty) in relation to all of the proven allegations. Counsel for the appellant also made it clear that the appellant acknowledged that the tribunal had the power under s 103(1) to impose a separate penalty in relation to each proven allegation. This was in line with the appellant's approach before the tribunal. See [149] of the tribunal's reasons. That being so, it is not necessary to consider the proper construction of s 103(1) and ground 1 should be dismissed. The appellant in effect merely alleged manifest inadequacy of penalty which is dealt with in ground 5.

57 The appellant alleges that the tribunal erred by failing to take into account material considerations being the contemporaneous nature of the breaches, their consistency and the respondent's motivation to benefit his family against the interests of his principal.

58 It is not necessary to decide whether these were considerations which the tribunal was bound to take into account because the tribunal did not fail to take these matters into account. The tribunal expressly mentioned that the 'events of the Devine transaction were followed reasonably soon after by those of the Flynn transaction' [162]; that the respondent claimed to be 'seeking to look after the interests of his family' [167]; and that the respondent 'seems to think that so long as he is not acting out of personal greed, deviation from his direct duties can be justified. It cannot be' [168].

59 In the face of those observations, leave to appeal on this ground must be refused because the ground of appeal has no reasonable prospect of success.

60 This ground alleges that the tribunal erred in law in failing to take into account a material consideration, namely a breach of a similar nature committed in the year 2000 by the respondent. The second aspect of the ground is that the tribunal breached s 77 of the SAT Act in that its reasons did not refer to this earlier breach.

61 The circumstances were somewhat unusual. According to the reasons of the tribunal, a full hearing of the case took place on 10 and 11 April 2008 and reasons for the orders were delivered on 21 May 2008.

62 On 11 April 2008, the President of the tribunal asked whether there were any prior disciplinary matters that the tribunal needed to be aware of. Counsel for the appellant board said 'No, we're not suggesting anything like that' (ts 52). Counsel for the respondent then properly informed the tribunal that there had been earlier proceedings although he could not assist as to details. The President then left it for counsel for both parties to discuss the matter and stated that if anything else needed to be brought to the tribunal's attention, then 'it can be' (ts 54). The parties were directed to inform the tribunal in writing if there was any earlier record.

63 On or about 15 April 2008, a record of inquiry against the respondent 'was brought to the attention of the Associate to [the President] with a request that the tribunal be notified of the same'. The record of inquiry revealed that on 28 November 2002 the appellant had held an inquiry under s 102(1)(b) of the REBA Act into various allegations of breach and that on that day the respondent had pleaded guilty to allegations that:

1. between 13 May 2000 and 30 August 2000 the Respondent knowingly misled and deceived the vendors in a transaction, contrary to Article 5(2) of the Code of Conduct for Agents and Sales Representatives ('the Code') made pursuant to section 101 of the Act;
2. between 13 May 2000 and 30 August 2000 the Respondent failed to act in the best interests of his principal, contrary to Article 2 of the Code;
3. on 13 May 2000 the Respondent failed to exercise due care and skill, contrary to Article 7 of the Code;
4. between 13 May 2000 and 14 May 2000 the Respondent failed to exercise due care and skill, contrary to Article 7 of the Code;
5. on or about 8 June 2000 the Respondent failed to exercise due care and skill, contrary to Article 7 of the Code;
6. between 8 June 2000 and 5 August 2000 the Respondent failed to act fairly and honestly, contrary to Article 5(1) of the Code;
7. on or about 7 March 2000 the Respondent failed to exercise due care and skill, contrary to Article 7 of the Code;

1. on or about 8 March 2000 the Respondent failed to act fairly and honestly, contrary to Article 5(1) of the Code.

64 The record revealed that 'The Board fined the Respondent $3,000 globally for the offences to which he had pleaded guilty' and ordered that the respondent pay costs of $2,000.

65 The tribunal was clearly aware of the possibility that there could be a record of some other earlier disciplinary offence. When record was found, it was referred to the associate to the president of the tribunal and there is nothing to suggest that the record was not given to the tribunal members by the associate.

66 Because the tribunal made it clear that any record of material revealing earlier breaches could be sent to it, the tribunal thereby clearly accepted that such material, if it existed, was relevant. It has not been established that the tribunal did not take into account the record of inquiry and so the first aspect of this ground must be dismissed. In any event, the mere failure of a decision maker to mention in its reasons material submitted to it during the course of a hearing will not lead to a conclusion that the tribunal failed to take into account a consideration it was bound to take into account. See Aronson M, Dyer B and Groves M, Judicial Review of Administrative Action (2009) 273. This is because considerations relevant to the tribunal's task are to be determined by reference to the legislation rather than the particular facts of the case the tribunal was called on to consider: Abebe v Commonwealth [1999] HCA 14; (1999) 197 CLR 510 [195] and Minister for Immigration and Multicultural Affairs v Yusuf [2001] HCA 30; (2001) 206 CLR 323, 347 - 348.

67 I now turn to the second aspect of the ground, namely the failure of the tribunal to mention the record. Section 77 of the SAT Act requires the tribunal to give reasons for a final decision. Section 77(2), like s 430(1)(c) of the Migration Act 1958 (Cth), requires the reasons to set out the 'findings on any material questions of fact' and to refer to 'the evidence or other material on which those findings are based' (s 430(1)(d) of the Migration Act).

68 The appellant submits that the respondent's prior record was 'highly' material to the imposition of disciplinary action in this case and that the prior record:

[W]as of such importance that the failure to mention it leads the identification of an error of law such that the exercise of discretion should be reviewed.

Questions therefore arise as to whether the appellant's implicit submission that there is some external standard of materiality is correct and whether the tribunal was obliged to make findings on any and every matter of fact objectively material to the decision it was required to make. In Yusuf the High Court had to consider s 430 of the Migration Act and at [68] McHugh, Gummow and Hayne JJ (Gleeson CJ agreeing) said:

Section 430 does not expressly impose such an obligation. In its terms, it requires no more than that the Tribunal set out the findings which it did make. Neither expressly nor impliedly does this section require the Tribunal to make, and then set out, some findings additional to those which it actually made. In Singh, significance was attached to the use of the word 'material' in s 430(1)(c). It was said (65) that 'material' in the expression 'material questions of fact' must mean 'objectively material'. Even if that were right, it would by no means follow that the Tribunal was bound to set out findings that it did not make. But it is not right to read 'material' as providing an objective or external standard of materiality. A requirement to set out findings and reasons focuses upon the subjective thought processes of the decision-maker. All that s 430(1)(c) obliges the Tribunal to do is set out its findings on those questions of fact which it considered to be material to the decision which it made and to the reasons it had for reaching that decision.

The consequence is that the failure to mention the record of earlier conviction was not a breach of s 77 of the SAT Act and therefore not an error of law. I would therefore dismiss ground 3.

69 Leave to appeal on ground 4 should be refused. The submission by the appellant that matters personal to the respondent such as admission of guilt, repayment of moneys and withdrawal from the Devine transaction after complaint was made were irrelevant, cannot be sustained. If an agent recognises his or her wrongdoing, then the tribunal was entitled to treat that as a fact relevant in deciding what order should be made against the agent. The public would clearly require greater protection from an agent who did not realise that he or she had breached the Act (even when the breach was drawn to the agent's attention) than an agent who recognised the wrongdoing and showed remorse.

70 The appellant submits that the tribunal's exercise of discretion must have miscarried, because the orders of fines and reprimands were manifestly inadequate. Once the breaches had been established, the orders made were made after the exercise of the tribunal's discretion as to the orders which would provide the protection to the public and the maintenance of requisite standards. An appeal against an exercise of that discretion is governed by established principles which are stated in House v The King [1936] HCA 40; (1936) 55 CLR 499, 505. If upon the facts the orders made were unreasonable or plainly unjust, then this court may infer that in some way there has been a failure to properly exercise the discretion which the law has reposed in the tribunal. If so, that would constitute an error of law:

In such a case, although the nature of the error may not be discoverable, the exercise of the discretion is reviewed on the ground that a substantial wrong has in fact occurred (505).

See Dinsdale v The Queen [2000] HCA 54; (2000) 202 CLR 321, 324 - 325 per Gleeson CJ and Hayne J.

71 One way of demonstrating manifest inadequacy or manifest excess is to show that the orders fall outside the range of orders customarily imposed in similar circumstances. Providing the cases which establish the range of orders reveal a principled approach then an order which is inexplicably outside the range will usually be manifestly inadequate or manifestly excessive. This court will not generally intervene if the order under review is lenient or severe, but within the range. However, even if orders made in a particular case fall within a range of orders customarily made by a tribunal for a particular kind of conduct, this court will not be bound to accept the range as providing guidance if the court considers that those other cases reflect an incorrect approach. One of the roles of an appeal court is to establish and maintain adequate standards of punishment for crime in criminal cases: Griffiths v The Queen [1977] HCA 44; (1977) 137 CLR 293, 310. Similarly, it is a role of this court to establish and maintain adequate levels of protective orders under the legislation under consideration in this case.

72 The appellant, in its written submissions asserted that the orders were manifestly inadequate without providing the court with any reference to orders that had been made in similar circumstances in the past. The court ordered that the appellant provide such information as was available about earlier relevant cases. The appellant subsequently filed written submissions referring to several decisions of the board or the District Court on appeal and the respondent did likewise.

73 Many of the cases to which reference was made involved conduct different from the conduct in this case. Those cases provide no helpful guidance about the appropriate order in the circumstances of this case. Allegation 4 relevantly concerns an agent who, although not purchasing for himself, arranged a purchase by his wife rather than himself in order to conceal the interest which he and his wife as an economic unit had in the transaction. An agent who purchases a property for himself/herself or their spouse when he/she is acting as agent for the vendor, and conceals their identity or their spouse's as purchaser, engages in conduct of the utmost seriousness. It is conduct involving a serious breach of fiduciary duty. While there is no rule of law forbidding a fiduciary from purchasing a property from the person to whom he owes fiduciary duties in relation to the property, the fiduciary must show that the transaction is at 'arms length'. That means that the fiduciary must disclose all information which could affect the judgment of the beneficiary in relation to the transaction. See Heydon JD, Jacobs' Law of Trusts in Australia (7th ed, 2006) [1747] and Meagher RP, Gummow WMC and Lehane JRF, Equity, Doctrines and Remedies (4th ed, 2002) 5-160 - 5-165. In Haywood v Roadknight [1927] VicLawRp 74; [1927] VLR 512, the Full Court of the Victorian Supreme Court pointed out that it is not to point for a fiduciary who fails to make full disclosure (in that case also a real estate agent) to seek to defeat a claim by the principal by insisting that the sale price was adequate and the conditions of sale fair. The Full Court cited Lord Blackburn in McPherson v Watt (1877) 3 App Cas 254, 272, that 'in such cases we do not inquire whether it was a good or a bad bargain, before we set it aside'. That meant that unless there had been full disclosure, the fiduciary cannot resist a decree setting aside the bargain by showing that the price was adequate.

74 This attitude of the courts demonstrates how seriously the law regards this kind of breach of fiduciary duty. The circumstances of non-disclosure may of course vary. In some cases there may be an inadvertent failure to disclose (which will still result in the transaction being set aside), but if there has been deliberate concealment of the fact that the fiduciary is the purchaser, then that will be considered a very serious breach of duty.

75 Conduct of this kind is conduct which the public must be protected against by appropriate orders. The offender must be encouraged or prevented from engaging in similar conduct in the future. In a case involving deliberate concealment, then a reprimand or a fine will be an inappropriate lenient order. Suspension or cancellation will usually be the only appropriate protective order.

76 The only decisions referred to by the parties involving cases of breach of fiduciary duty by purchasing from the vendor without disclosure were Roberts (7 February and 14 February 1992) and Kennedy/Cansdale Holdings Pty Ltd (6 March 1998). In Roberts, the agent, having sold the property, arranged to substitute himself as the purchaser without advising the vendor client that he was taking over as purchaser. The board in that case cancelled Mr Roberts' licence and triennial certificate and imposed a fine of $1,000. In an inquiry concerning Kennedy/Cansdale Holdings Pty Ltd an entity associated with the agent purchased property without first having obtained written consent of the vendor. The board imposed a $5,000 fine. There was no reference made in the board's reasons to any deliberate concealment.

77 There is also a relevant reported case not referred to by the parties. It is the decision of Hickey v Donnelly [1971] WAR 153. In that case, a real estate agent did not disclose that he was the director of the company which purchased land from his client. The magistrate who was hearing an application to cancel the agent's licence held:

In my view, the business methods adopted by the respondent in this transaction were highly questionable and it is no excuse for him to shelter behind his co-directors, pleading partial ignorance. An agent for sale who takes an interest in a purchase negotiated by himself is bound to disclose to his principal the exact nature of his interest (155).

The magistrate concluded that the true position was not properly disclosed and cancelled the agent's licence. Virtue SPJ held that there was no evidence to support the conclusion that the vendor was adversely affected by the non-disclosure and that the circumstances did not justify the extreme step of cancelling the real estate agent's licence. Virtue SPJ considered that the cancellation of licence was 'too drastic a penalty to impose' (156). His Honour set aside the cancellation and ordered that a fine of $150 was appropriate because there was no injury to the vendor and that if there were any injury 'he would undoubtedly have his civil remedy against the agent' (155). With respect, the concentration on the fact that the vendor was not adversely affected by the non-disclosure resulted in an understatement the seriousness of the conduct. As a result, that decision does not correctly reflect how seriously the law regards a breach of fiduciary duty where a fiduciary purchases property without disclosing his interest.

78 The case here is not a case of an agent purchasing the property himself, but a sale to a spouse is just as serious. In fact, it may be inferred that the sale was not to the agent himself, only because he wanted to conceal any interest he might have had in the transaction. This inference may be drawn from the fact that he used his wife's maiden name and did not give her correct address.

79 The finding was that the respondent 'consciously went out of his way to prefer his own interest to those of his principal' and that he 'took advantage of the inability of the principal to obtain an enforceable sale' [157]. The finding was that he 'concealed the relationship' between himself and his wife by using his wife's maiden name, and a different address [157]. He then claimed and received a commission following settlement of the sale, after the deception had taken place. Although the respondent admitted his guilt and refunded the commission when his conduct was uncovered, this does not significantly diminish the seriousness of the breach of duty. Furthermore, the respondent seemed not to fully appreciate the seriousness of his conduct because the tribunal noted:

He seems to think that so long as he is not acting out of personal greed, deviation from his direct duties can be justified [168].

Finally, the earlier record shows that the respondent had been guilty of deceptive and misleading conduct only five years before.

80 The range of orders authorised by the REBA Act ranges from reprimand through to fine, suspension and cancellation of licence. A reprimand is appropriate for minor misconduct. A fine is appropriate for more serious breaches which do not require the public to be protected by suspending an agent's licence or cancelling it. In relation to allegation 4, the conduct indicated a need to protect the public. For an agent to consciously prefer his own interests to those of his principal; to deceive his principal; take advantage of the principal; and to conceal his deception in the way that he did, was to engage in conduct so serious that a reprimand and fine of $1,000 were manifestly inadequate orders to make. Ground 5 should be upheld in relation to allegation 4.

81 It is therefore necessary to consider what order should be made. In my opinion, cancellation of the respondent's licence for two years is the appropriate penalty for allegation 4. That result is achieved after taking into account the fact that there had been an earlier disciplinary order made and the fact that the respondent does not seem to fully appreciate the seriousness of his conduct. The mitigating factors are those mentioned by the tribunal, including the respondent's admission in relation to allegation 4.

82 For my part, I would not interfere with any of the other penalties. The fines and reprimands imposed in those cases are not manifestly inadequate.

83 Leave to appeal should be granted in relation to grounds 1, 3 and 5 and refused in relation to grounds 2 and 4, for the reasons discussed above.

84 Grounds 1 and 3 should be dismissed. Ground 5 should be upheld in relation to allegation 4, the existing penalty should be set aside and in lieu the respondent's licence should be cancelled for two years.

85 NEWNES JA: I agree with McLure JA on grounds 1 and 5 and with Pullin JA on grounds 2, 3 and 4.