The Queensland Building and Construction Commission Act 1991 (“the Act”) sets out numerous grounds and procedures for Queensland Building and Construction Commission (“QBCC”) licence cancellation and exclusion.

What do you need to know about the QBCC Licence Exclusion?

Part 3E of the Act sets out those provisions relating to the allocation of demerit points and the disqualification of a person for accumulating more than 30 demerit points within 3 years. As with most provisions of the Act, those contained in Part 3E are heavily reliant on the use of defined terms the meaning of which may be contained and modified throughout the Act and which may not reflect the ordinary meaning of the plain word used. Accordingly, some of the main defined terms are set out below.

This article briefly outlines the disqualifying provisions under the Act in respect of demerit matters.

Please note that the information contained in this article is provided for information purposes only and should not be considered as being legal advice applying to your specific situation.

PART 1: DEMERIT MATTERS

Part 3E of the Act requires the QBCC to allocate demerit points to a licensee in respect of a demerit matter.

What is a “demerit matter”?

A “demerit matter” can be either:

(a) a “conviction” for a “demerit offence”; or

(b) an unsatisfied “judgment debt”.

What is a “demerit offence”?

Under the Act, a “demerit offence” can be either:

(a) An offence against a provision prescribed by regulation; or

(b) A contravention of a requirement imposed under this Act and prescribed by regulation.

We have set out the offence provisions listed in the Queensland Building and Construction Commission Regulation 2003 (“QBCC Regulation”) schedule 2AA, column 1 which carry demerit points.

Note that in addition to Part 3E of the Act (the subject of this article), the Act additionally provides in Part 3 Division 9 for the suspension of cancellation of and a licence where the licensee is convicted of an offence against this Act.

Wide definition of “conviction”

Under the Act, the term “conviction” of a person for a demerit offence, includes the following in relation to the offence:

(a) a court finding the person guilty or accepting the person’s plea of guilty, whether or not a conviction is recorded;

(b) the person paying a fine under an infringement notice in full;

(c) the person paying the first instalment of a fine under an infringement notice;

(d) the registration by the registrar of a default certificate for an infringement notice given to the person; and

(e) a decision of the QBCC to take disciplinary action against the person if the disciplinary action has “taken effect” under section 74G of the Act.

In relation to sub-paragraph (e) above, a QBCC disciplinary action notice is deemed to have “taken effect” 29 days after the person is given a notice of the decision to take disciplinary action (unless stayed or another period is given in the notice.

What is the definition of “judgment debt”?

Under the Act, a “judgment debt” is the amount, for which judgment has been entered in a court of competent jurisdiction, owing by a building contractor:

(a) in relation to a building contract or a domestic building contract ; or

(b) for goods or services supplied for building work to be carried out under a building contract or domestic building work to be carried out under a domestic building contract; or

(c) to the QBCC for a claim under the statutory insurance scheme .

The Act puts the onus on a judgement debtor to notify the QBCC within 14 days if a judgment debt becomes an unsatisfied judgment debt. Failure to do so is an offence attracting a maximum fine of 40 penalty units.

The potential reach of the offence is unpredictable and concerning, given that the reference to “goods or services” imports a very wide application of the offence, particularly given that the terms “building contract”, “domestic building contract”, “building work”, and “domestic building work” are defined by the Act and may include things that are not immediately apparent from the ordinary meaning of the plain words used.

Allocation of demerit points

Under the Act, the QBCC must allocate demerit points in the following manner:

(a) Where a person has a conviction for a demerit offence, QBCC must apply the number of points allocated to the offence under the QBCC Regulation.

(b) Where a person is a judgment debtor for an unsatisfied judgment debt, the QBCC must allocate 10 demerit points.

The Act includes detailed provisions setting out when demerit points are deemed to be allocated.

The QBCC must notify a person as soon as practical after allocating demerit points to them. The notification must include details of the demerit points allocated, the demerit matters for which they are allocated, and the date the points took effect.

A QBCC decision to allocate demerit points to a person is not a decision reviewable in QCAT.

PART 2: DISQUALIFICATION PROCESS FOR AN INDIVIDUAL

The disqualification process for an individual who has accumulated 30 demerit points in a period of 3 years is it out below.

First Notice: Accumulation of 30 demerit points (s 67AZD)

If the QBCC considers that an individual has accumulated 30 demerit points in a period of 3 years, it must give the individual a written notice stating:

(c) Details of the demerit matters for which the demerit points have accumulated and the dates the points took effect;

(d) The effect of the individual becoming a disqualified individual for accumulating 30 demerit points in a period of 3 years; and

(e) An invitation to the individual to make written submissions, within a stated period (at least 28 days), to satisfy the QBCC that the individual has not accumulated 30 demerit points in a period of 3 years.

Providing submissions to the QBCC

The QBCC must consider any submissions made by the individual, and if it is satisfied that the individual has not accumulated 30 demerit points in a period of 3 years, it must advise the individual in writing that no further action will be taken in relation to the written notice.

Second Notice (to a Licensee): Cancellation and not a fit and proper person (s 67AZF)

If the QBCC is not satisfied by the submissions (or if no submissions are received), then the QBCC is required to take the following steps:

(a) notify the individual in writing of that decision; and

(b) cancel their licence and inform them that they are taken not to be a fit and proper person under the Act; and

(c) inform them regarding their right to apply to QCAT for a review and any right to have the operation of the QBCC decision stayed by QCAT.

An individual given a notice that they are taken not to be a fit and proper person (a disqualified individual) may apply have the QBCC’s decision reviewed by QCAT.

PART 3: DISQUALIFICATION PROCESS FOR A COMPANY

The disqualification process for company that has accumulated 30 demerit points in a period of 3 years is it out below.

First Notice: accumulation of 30 demerit points (s 67AZH)

If the QBCC considers that a company has accumulated 30 demerit points in a period of 3 years, it must give any individual who was a director or secretary of, or an influential person or nominee for, the company, a written notice stating:

(a) Details of the demerit matters for which the demerit points have accumulated and the dates the points took effect;

(b) The effect of the director, secretary, influential person, or nominee becoming a disqualified individual because the company has accumulated 30 demerit points in a period of 3 years; and

(c) An invitation to the director, secretary, influential person, or nominee to make written submissions, within a stated period (at least 28 days ), to satisfy the QBCC that:

(i) the company has not accumulated 30 demerit points in a period of 3 years; or

(ii) the director, secretary, influential person, or nominee exercised reasonable diligence to ensure that some or all of the matters for which the demerit points accumulated did not happen;

(iii) the director, secretary, influential person, or nominee was not in a position to influence the conduct of the company’s affairs in relation to some or all of the matters for which the demerit points accumulated.

Providing submissions to the QBCC

The QBCC must consider any submissions made by the director, secretary, influential person, or nominee, and if it is satisfied that the individual has not accumulated 30 demerit points in a period of 3 years, it must advise the person in writing that no further action will be taken in relation to the written notice.

The QBCC must consider any submissions made by the accused director, secretary, influential person or nominee, and must advise them in writing that no further action will be taken in relation to the written notice if after considering their submissions, the QBCC is satisfied that:

(a) the company has not accumulated 30 demerit points in a period of 3 years;

(b) the director, secretary, influential person or nominee exercised reasonable diligence to ensure that some or all of the demerit matters for which demerit points accumulated did not happen; or

(c) the director, secretary, influential person or nominee was not in a position to influence the conduct of the company’s affairs in relation to some or all of the demerit matters for which demerit points accumulated.

Second Notice (to licensee): cancellation & not a fit and proper person (s 67AZJ)

If the QBCC is not satisfied by the submissions of those matters (or if no submissions are received), then in the case of a director, secretary, influential person or nominee who is a licensee, the QBCC is required to take the following steps:

(a) notify the person of that decision;

(b) cancel their licence and inform them that they are taken not to be a fit and proper person under the Act; and

(c) inform them of their right to apply to QCAT for a review and of any right to have the operation of the QBCC decision stayed by QCAT.

A director, secretary, influential person or nominee who is given this notice is taken not to be a fit and proper person. They may have the QBCC’s decision to give the notice reviewed in in the QCAT.

Further, upon being given the notice, the director, secretary, influential person or nominee becomes a “disqualified individual”.

Second Notice (to non-licensee): not a fit and proper person (s 67AZK)

In the case that the director, secretary, influential person or nominee is not a licensee, if the QBCC is not satisfied by the submissions of those matters (or if no submissions are received), then it is required to take the following steps, namely it must:

(a) notify the individual of that decision;

(b) inform them that they are taken not to be a fit and proper person under the Act; and

(c) inform them regarding their right to apply to QCAT for a review and any right to have the operation of the QBCC decision stayed by QCAT.

A director, secretary, influential person or nominee who is given this notice is taken not to be a fit and proper person. They may have the QBCC’s decision to give the notice reviewed in in the QCAT.

Further, upon being given the notice, the director, secretary, influential person or nominee becomes a “disqualified individual”.

Notice to company regarding a disqualified individual (s 67AZL)

If the QBCC considers that a company that is a licensee has a disqualified individual as a director, secretary, influential person or nominee, then it must give the company a written notice:

(a) identifying the relevant individual said to be a director, secretary, influential person or nominee; and

(b) stating that the relevant individual must stop being a director, secretary, influential person or nominee of the company within 28 days after the QBCC gives the notice, or else the QBCC must cancel the company’s licence.

If the QBCC must cancel the company’s licence under this section, it is not required to give the usual notice of its reasons in the case of cancellation of the licence.

The QBCC’s decision that a company has a disqualified individual as a director or secretary, influential person or nominee can be reviewed in in the QCAT.

How Boss Lawyers can help you

This can be a complex area of law which can have a devastating effect on your ability to operate in the building industry in Queensland.

Given the serious consequences involved, you should always obtain competent independent legal advice regarding your particular circumstances, the validity of any adverse decision made against you, and the options that may be available to you.

For practical legal advice, support and assistance regarding your particular circumstances, call Boss Lawyers. We are ready to step in and assist you to assert your rights and protect your interests.