In light of the recent Queensland Civil and Administrative Tribunal (QCAT) decision in the case of All Remedial & Building Services Pty Ltd v Queensland Building and Construction Commission; Moss v Queensland Building and Construction Commission (the Decision), the tribunal set aside a determination made by the Queensland Building and Construction Commission (QBCC) that a builder and his company were an excluded individual and excluded company.
As a result of this decision, this short article will provide an outline of the Decision made by QCAT and discuss the importance of having all of your company affairs in order after resignation of a directorship to avoid being caught by section 56AC of the Queensland Building and Construction Commission Act 1991 (Qld) (QBCC Act).
Excluded individual and Company: Case background
Lance Moss (Moss) was a builder and the director of two companies; All Remedial and Building Services Pty Ltd (Remedial Building) and All Pro Australia Engineering and Construction Pty Ltd (All Pro). Both companies were involved in conducting building works. In 2014, shortly after incorporating All Pro, Moss had an administrative disagreement with the fellow director of All Pro, and subsequently, decided to “pull out” of the company and only conduct building works using Remedial Building. However, Moss did not officially resign as a director of All Pro until 2016.
In September 2018, an administrator was appointed to All Pro and on this basis, the QBCC deemed All Pro to be involved in a ‘relevant company event’ for the purposes of section 56AC of the QBCC Act. This decision impacted Moss because he previously held shareholdings in All Pro and as a result, the QBCC considered Moss to be an ‘excluded individual’. Accordingly, Remedial Building therefore became an ‘excluded company’ pursuant to section 56AC of the QBCC Act.
What were the issues, was Moss an excluded individual?
The issues in this case were whether Moss should be deemed an ‘excluded individual’, and in turn, whether Remedial Building should also be classified as an ‘excluded company’ for the purposes of 56AC of the QBCC Act.
What was the decision?
In determining their decision, the Tribunal considered that Moss did not have any involvement, nor did he conduct any actual building work for All Pro. Moss indicated that he was under the impression that providing his resignation as a director of All Pro would also result in the shareholdings held by him being transferred out of his name. Moss only realised that he still held a shareholding in All Pro when the QBCC notified him that they deemed him to be an excluded individual based on the administrator being appointed to All Pro.
Given Moss was unaware he still held shareholdings in All Pro, he had no involvement and did not exercise any aspects of control over the company, the Tribunal determined that the QBCC’s decision deeming Moss to be an excluded individual and Remedial Building an excluded company be set aside.
What does this mean for you?
Although the Tribunal set aside the previous decision made by the QBCC, it is important to note that the QBCC will investigate any director, secretary, shareholder or influential person to a building company should an administrator or liquidator be appointed.
How can we help?
If you are concerned that you may still hold shares in previous building companies, or seek advice on how to protect yourself and associated building entities being deemed an excluded individual or excluded company for the purposes of the QBCC Act, please contact the Construction Team at Rostron Carlyle Rojas Lawyers on (07) 3009 8444 or email us at [email protected].
Please note that this article has been prepared by Jakob Mignone, Law Clerk and settled by John Christian, Associate of Rostron Carlyle Rojas Lawyers. Its contents are for general information purposes only and does not by any means constitute legal advice, nor should it be relied upon.