Denial of natural justice and procedural fairness
12 In relation to natural justice, Professor S A de Smith, Judicial Review of Administrative Act, 2nd ed., pp 180-181 has stated:
"Natural justice generally required that persons liable to be directly affected by proposed administrative acts, decisions or proceedings be given adequate notice of what is proposed, so that they may be in a position: (a) to make representations on their own behalf; or (b) to appear at a hearing or inquiry (if one is to be held); and (c) effectively to prepare their own case and to answer the case (if any) they have to meet."
13 In Kioa v West (1985) 159 CLR 550 the High Court held that the duty to accord natural justice is a duty to act fairly. In the normal course, a party to judicial proceedings (as are those in a tribunal) could expect to be apprised of the nature of the case sought to be made against it, and of the date and time fixed for hearing such as to give it a reasonable opportunity to meet that case and to advance its own. These statements are similar to those expressed by Professor de Smith and referred to earlier. Brennan J (as he then was) at 628 stated:
"A person whose interests are likely to be affected by an exercise of power must be given an opportunity to deal with relevant matters adverse to his interest which the repository of the power proposes to take into account in deciding upon its exercise."
14 In relation to procedural fairness, Mason J stated in Kioa at 584-585 that the law had now developed to a point where it may be accepted that there is a common law duty to act fairly, in the sense of according procedural fairness, in the making of administrative decisions which affect rights, interests and legitimate expectations, subject only to the clear manifestation of a contrary statutory intention. Procedural fairness is a notion of a flexible obligation to adopt fair procedures which are appropriate and adapted to the circumstances of the particular case (pp 454 and 455). Hence, whether there is a denial of procedural fairness depends on the circumstances in each case.
15 Unlike the CTTT, this court has had the advantage of Mr Ross' evidence. The plaintiff was cross examined. I closely observed the plaintiff while he was being cross examined and formed the view that he was not a credible witness. His evidence is frankly, unbelievable.
16 The plaintiff outlined the novel way by which his business set about obtaining money from and ostensibly for the benefit of consumers. Mr Ross explained that when a client telephoned in response to an advertisement (presumably that appeared in a newspaper) they were asked to attend the plaintiff's business premises at Broadway. In evidence there are references to the "Glebe" office and the "Broadway" office. Those references are to the same place, which for convenience, I shall refer to as the Broadway office. Initially, the client was interviewed by an employee of the plaintiff's business and a "due diligence" was undertaken. After this had taken place the client was given a schedule of costs. No charges were incurred by the client up to this point. The client was then given an opportunity to decide if he or she wished to proceed to the next step. When asked what exactly was offered to the client, Mr Ross answered that he was unable to say, as every case was different. When asked if "offered to them" meant some prospect of borrowing money Mr Ross answered that "It may be".
17 Sometimes Mr Ross or his representative would instruct the client to go to Grace Bros. Broadway to obtain gift vouchers in order to establish their credit rating. The client may have been required to fill out a credit application with Grace Bros. in order to obtain the gift vouchers on credit. For example, the client would request $500.00 credit. Grace Bros. would do a cursory check and would advance to him or her credit in the form of vouchers, which could be used at the Grace Bros. Broadway store or used to pay Mr Ross' business fee. That Grace Bros. transaction record is then forwarded to the Credit Association Records. According to Mr Ross, the obtaining of gift vouchers then gave the client some form of credit rating and establishes "some borrowing empathy". The client returns to the business conducted by Mr Ross and could pay his fee in vouchers. Depending on the nature of the client's request, the business would then assist him/her either to consolidate debt or borrow more funds. Mr Ross or his representative may then assist the client in making a bankcard or loan application. Because the client had now obtained a credit rating from the Grace Bros. transaction, this credit rating meant the bank would issue a bankcard or advance a small loan (t 13, 14, 15.5).
18 Mr Ross' evidence was that the fee his company received was a fee for service business, but denied he received a fee or any form of payment from the bank or loan provider. He explained that his business took the fee upfront from the consumer with a schedule of costs. When asked if he was aware as to whether it was legal in terms of the Consumer Credit Act, Mr Ross took the stance "It is illegal under the Finances Brokers Act which is why we are not finance brokers in that business" even though he admitted that his business is called "Credit Accounting Consultancy", his letterhead bears the words "management consultant" and in the advertisement there appears in big bold type the word "Accountancy".
19 Mr Ross gave evidence that there were a number of judgments against his business in the CTTT. He admitted that dissatisfied clients who had been the subject of a "third party fraud" had not been repaid by his business. This "third party fraud" is referred to in more detail later in this judgment.