FEDERAL COURT OF AUSTRALIA

Zivanovic v Australian Securities and Investments Commission (No 2) [2018] FCA 676

ORDERS

THE COURT ORDERS THAT:

1.    The appeal be dismissed.

2.    The applicant pay the respondent’s costs of the appeal.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

GLEESON J:

1    Mr Zivanovic appeals from a decision of the Administrative Appeals Tribunal (“Tribunal”) given on 8 August 2017, affirming the decision of a delegate of the respondent (“ASIC”) made on 18 February 2016 to disqualify Mr Zivanovic from managing corporations for a period of three years.

2    ASIC’s decision was made under s 206F(3) of the Corporations Act 2001 (Cth) (“Corporations Act”).

3    The appeal is brought pursuant to s 44(1) of the Administrative Appeals Act 1975 (Cth) (“AAT Act”), by which a party to a proceeding before the Tribunal may appeal to this Court, on a question of law, from any decision of the Tribunal in that proceeding.

Background to appeal

4    Section 206F(1) of the Corporations Act provides relevantly:

(1)    ASIC may disqualify a person from managing corporations for up to 5 years if:

(a)    within 7 years immediately before ASIC gives a notice under paragraph (b)(i):

(i)    the person has been an officer of 2 or more corporations; and

(ii)    while the person was an officer, or within 12 months after the person ceased to be an officer of those corporations, each of the corporations was wound up and a liquidator lodged a report under subsection 533(1) … about the corporation’s inability to pay its debts; and

(b)    ASIC has given the person:

(i)    a notice in the prescribed form requiring them to demonstrate why they should not be disqualified; and

(ii)    an opportunity to be heard on the question; and

(c)    ASIC is satisfied that the disqualification is justified.

5    Between October 2008 and November 2014, eighteen companies were wound up in insolvency of which Mr Zivanovic was a director (at least until a few months before the liquidations). The liquidator of each company subsequently reported that unsecured creditors were unlikely to be paid any dividend.

6    Mr Zivanovic accepts that the conditions in s 206F(1)(a) and (b) were satisfied, with the result that the discretion conferred on ASIC to disqualify him was enlivened.

7    ASIC having exercised that discretion, in February 2016 Mr Zivanovic applied to the Tribunal to review ASIC decision. As mandated by s 43(6) of the AAT Act, the Tribunal’s task was to determine whether it was satisfied that the disqualification was justified within the meaning of s 206F(1)(c) and, if so, whether Mr Zivanovic should be disqualified and for what period. In determining whether disqualification was justified, the Tribunal was required to apply s 206F(2) of the Corporations Act, which relevantly provides:

(2)    In determining whether disqualification is justified, ASIC:

(a)    must have regard to whether any of the corporations mentioned in subsection (1) were related to one another; and

(b)    may have regard to:

(i)    the person’s conduct in relation to the management, business or property of any corporation; and

(ii)    whether the disqualification would be in the public interest; and

(iii)    any other matters that ASIC considers appropriate.

8    The written submissions made on behalf of Mr Zivanovic drew attention to the following findings made by the Tribunal:

(1)    91% of the total liquidation liabilities were owed to entities associated with Mr Zivanovic;

(2)    fourteen out of 18 failed companies were “project specific” development, investment or holding companies;

(3)    eleven out of 14 of those failed companies accounted for 69.5% of the total liquidation liabilities, but had no significant “external” liabilities;

(4)    the Australian Taxation Office was the only significant creditor of the three companies with significant “external” liabilities;

(5)    only liquidations occurring after September 2013 involved significant external liabilities;

(6)    the failures of the two group construction/project management entities resulted in liquidation liabilities of $2.6 million, of which $452,000 (about 28%) involved “external creditors” and did not include the ATO; and

(7)    in only one instance was unpaid income tax a significant liquidation liability.

9    In relation to the Tribunal’s analysis of the “underlying reasons” for the various liquidations, the written submissions referred to the following findings (at paras 80 to 84 of the Tribunal’s reasons):

80.    … First of all, the liquidations that occurred prior to June 2010, the Mountrich liquidation in calendar 2012, and three of the four liquidations that occurred in May 2014, appear to involve entities that had been incorporated for specific projects, which they had completed. Their insolvency involved only related group entity creditors, and appears to reflect a management structure that, whilst alert to ensure satisfaction of external creditors, was generally prepared to absorb individual entity losses within the group structure …

81.    The Girraween Scaffold liquidation in January 2012 appears to have been the result of a genuine deterioration in trading conditions, and an attempt to rectify that deterioration by an appropriate re-structuring of the conduct and management of the business. Again, the costs of that adjustment appear to have been borne by group entities, without significant adverse impact on creditors or employees.

82.    On the other hand, the liquidation of the various Bargara development corporate entities, and the liquidation of Ezocom, appear to have been the result of commitment to overambitious development projects. That over ambition being dramatically highlighted by (i) the ill-considered acceptance of the PAG mezzanine funding arrangement to embark on the “Ocean” development at Narrabeen, New South Wales and, (ii) the consequences of the refinancing conditions imposed by the NAB in February 2012.

83.    … [I]t is difficult to identify any satisfactory reason for the insolvent liquidation of Fratocom, and the “migration” of its business activities to Erect Safe Scaffolding (NSW) Pty Ltd. That “migration” decision apparently saw all of Fratocom’s trade creditors paid in full (it is reasonable to assume that they were in the order of $2.15m:- see eg., Schedule 5 column F, row 45) but its known taxation liabilities undischarged.

84.     The fact … that [Mr Zivanovic] was both willing and able to fund various companies for the purpose of minimising their undischarged liabilities is evident. It mitigates, to an extent, the adverse consequences of the flawed management he ultimately conceded. There is also an element of mitigation in the corresponding appearance that, with the likely exception of Kakconab all unrelated trade creditors were paid. …

10    Mr Zivanovic’s submissions also emphasised para 121 of the AAT’s reasons which states:

I accept the proposition that [Mr Zivanovic] has had substantial sanctions visited upon him – as a result of the “related” unsecured liabilities indicated in Schedule 1, ASIC’s decision and the management changes he has caused to be implemented within the group. If the likelihood of future management deficiencies were the only material considerations, I would be disinclined to regard his disqualification as justified, even taking into account the December 2014 convictions on which ASIC relied. (I regard the non-production as aberrant, rather than typical.) However, it is not the only nor in my opinion, the determinative consideration.

11    Shortly prior to the appeal, Mr Zivanovic made an application for leave to adduce further evidence. The application was said to be contingent upon the outcome of the Full Court’s decision in Malek Fahd Islamic School Limited v Minister for Education and Training [2018] FCAFC 37. After the hearing of the appeal, Mr Zivanovic’s lawyers notified the Court that the application was not pressed in light of the outcome in Malek Fahd.

Nature of appeal

12    In Haritos v Commissioner of Taxation [2015] FCAFC 92; (2015) 233 FCR 315, the Full Court explained the scope of the phrase “question of law” in s 44 at [62].

13    In Repatriation Commission v Hill [2002] FCAFC 192; (2002) 69 ALD 581 at [59], the Full Court said:

[A] decision cannot be the subject of an appeal under s 44(1) of the Administrative Appeals Tribunal Act 1975 (“AAT Act”), unless, in making it, the Tribunal has acted otherwise than in accordance with the law. If a tribunal falls into an error of law “which causes it to identify a wrong issue, to ask itself a wrong question, to ignore relevant material, to rely on irrelevant material or, at least in some circumstances, to make an erroneous finding or to reach a mistaken conclusion, and the tribunal’s exercise or purported exercise of power is thereby affected, it exceeds its authority or powers”: see Craig v South Australia (1995) 184 CLR 163 at 179. An error of law of this kind may support an appeal under s 44 of the AAT Act on a question of law: cf Hospital Benefit Fund of Western Australia Inc v Minister for Health, Housing and Community Services (1992) 39 FCR 225 at 231–232 per Wilcox, Burchett and French JJ.

14    As explained by the Full Court in Collector of Customs v Pozzolanic Enterprises Pty Ltd [1993] FCA 456; (1993) 43 FCR 280 at 287, whose comments were subsequently adopted by the High Court in Minister for Immigration & Ethnic Affairs v Wu Shan Liang [1996] HCA 6; (1996) 185 CLR 259 at 272, the Court will not be concerned with looseness in the language of a tribunal nor with unhappy phrasing of a tribunal’s thoughts. Further, the Court will not construe the reasons for the decision under review “minutely and finely with an eye keenly attuned to the perception of error”: Politis v Federal Commissioner of Taxation [1988] FCA 739; (1988) 16 ALD 707 at 708 per Lockhart J, adopted by the Full Court in Pozzolanic at [22] and Brennan CJ, Toohey, McHugh and Brennan JJ in Wu Shan Liang at 271.

Ground 1 – Findings as to adverse effects of disqualification

15    As put on behalf of Mr Zivanovic, the “crux” of this ground of appeal was that, having accepted (at para 111 of the Tribunal’s reasons) that the consequences of the disqualification decision were relevant considerations in the exercise of the disqualification discretion, the Tribunal erred by exercising its discretion in reliance upon its finding that disqualification would not have an adverse impact on the business of Mr Zivanovic’s continuing group of companies, their companies, their employees and clients, which was not open or not reasonably open to it on the evidence.

16    Although ground 1 of the appeal refers to findings at paras 101 and 102 of the AAT’s reasons, Mr Zivanovic’s written submissions are principally addressed to para 108 of the Tribunal’s reasons. At para 101, the Tribunal found that the objective evidence established, for reasons said to be outlined at para 107, the unlikelihood of Mr Zivanovic’s disqualification having “any material adverse effect on the operations of any of the group companies”. At para 102, the Tribunal concluded that there was no sufficient basis to accept as well-founded Mr Zivanovic’s “apprehension” that “the group’s trading success” was “dependent on his reputation”. Paragraph 108 concluded:

108. There is no likelihood that the group companies, under the control of their current directors, will deviate from the reputation that [Mr Zivanovic] professes to have established with his development associate. Accordingly, I am not satisfied that the group’s prospects in relation to those projects are likely (in the sense that there is a real and significant risk) to be adversely affected by [Mr Zivanovic]’s temporary disqualification as a director of the group companies.

17    The contention that there was “no evidence” upon which these findings could, or could reasonably be based involves the proposition that the Tribunal was required not to make those findings. That proposition, in turn, requires a conclusion that the evidence necessitated conclusions to the contrary of those reached by the Tribunal.

18    The submission put on behalf of Mr Zivanovic was that there was considerable evidence, said to be the only evidence before the Tribunal, and said to have been accepted, which “amply supported” the finding of probable impact of the disqualification decision.

19    Even if that submission were accepted, it would not require a conclusion to the contrary of the findings made by the Tribunal, as set out above, or a consequent conclusion that there was an error on a question of law in connection with those findings. All Mr Zivanovic’s submission entails is that, as a question of fact, it was open to the Tribunal to make findings contrary to the disputed findings. The Tribunal was not bound by the rules of evidence (AAT Act, s 33(1)(c) and, in any event, there is no unqualified rule of evidence that requires acceptance of uncontradicted evidence: see Heydon JD, Cross on Evidence (10th ed, LexisNexis Butterworths, 2015), 199 fn 905; Zora Tomic v Limro Pty Ltd and Australian Capital Territory Health Authority [1993] FCA 897; (1993) 47 FCR 414.

20    The nature of the evidence given by and on behalf of Mr Zivanovic fell well short of evidence that required any conclusion as to the probable impact of the disqualification decision. As described by him in his written submissions, it was merely evidence “as to his beliefs with respect to the likely impact” of the decision, together with the evidence of other witnesses’ beliefs.

21    As ASIC submitted, the submission that there was an ample evidentiary foundation for a finding of a real and significant risk of adverse consequences does not support a conclusion that there was no evidence to support the Tribunal’s finding that there was no such risk.

22    Moreover, nor does the submission demonstrate that the Tribunal overlooked certain matters. Rather, the submission raises only a question of whether the Tribunal made an error of fact.

23    Finally, as ASIC submitted, there was an evidentiary basis to support the relevant findings, a basis that was identified by the Tribunal at paras 107 and 108 of its reasons. In particular, those paragraphs reveal that the findings were based on the following evidence (including an absence of evidence) that:

(1)    There was no objective reason why disqualification should or would detract from Mr Zivanovic’s practical ability to continue to contribution to the successful operation of the group’s activities. In particular, there was no reason why disqualification should diminish Mr Zivanovic’s future ability to play a meaningful substantive role in identifying and facilitating the group’s development activities, the evidence being that this was the kind of role that Mr Zivanovic had previously played.

(2)    The evidence was that Mr Zivanovic would retain his personal financial interest in the group companies and, in that capacity, would be able to continue to represent himself as directly concerned to ensure the proper and profitable operation of the group and the maintenance of the generally good reputation it was asserted to have.

(3)    While the management deficiencies which underlay ASIC’s disqualification decision do provide some objective reason to detract from that reputation, the evidence was that the relevant corporate insolvencies had the timing and consequences identified by the Tribunal and must have been well known within the building and construction circles in which the group operated.

(4)    The evidence was that Mr Zivanovic and his current group of companies had continued to enjoy a good reputation and command a significant volume of work.

(5)    Because of Mr Zivanovic’s undertaking not to act as a director pending the outcome of the Tribunal proceeding, the group was already under the control of others. At para 102, the Tribunal noted Mr Zivanovic’s concession that disqualification would not adversely affect the governance of the group in the light of the management changes that had been implemented.

24    For these reasons, the contention that the Tribunal erred on a question of law in relation to ground 1 must be rejected.

Ground 2 – Wrongful application of directors’ duties standards

25    Ground 2 is that the Tribunal erred by evaluating Mr Zivanovic’s past management of corporations and discharge of his duties as a company director by reference to levels of skill and diligence which were materially greater than the levels of skill and diligence required of him by the Corporations Act and the general law.

26    Mr Zivanovic’s written submissions commenced with a false premise, namely, that not having found “incompetence”, the Tribunal imposed on Mr Zivanovic a standard of care and diligence higher than it was entitled to require.

27    While the question of Mr Zivanovic’s competence is a matter of potential relevance to whether the disqualification was “justified”, it was not a matter that the Tribunal was required to consider. Curiously, at para 40 of his written submissions in connection with ground 3, Mr Zivanovic expressly disavows a contention that findings of dishonesty and/or incompetence were necessary for the disqualification power to be enlivened. As the Full Court relevantly observed in Murdaca v Australian Securities and Investments Commission [2009] FCAFC 92; (2009) 178 FCR 119; at [101]:

…

(b)    ASIC’s power to disqualify a person from the management of corporations must be exercised for the purposes for which it was granted. Those purposes are the protection of all those persons who deal with corporations from the consequences of the actions of those corporate officeholders who, either through incompetence or dishonesty or a combination of the two, bring about the failure of corporations and thus cause loss to others (Rich v Australian Securities and Investments Commission [2004] HCA 42; (2004) 220 CLR 129 at [47]–[50] (151–155) and the maintenance of professional management standards in the public interest (Visnic v Australian Securities and Investments Commission [2007] HCA 24; (2007) 231 CLR 381 at [11] (p 385) and [26] (p 388)).

(c)    Section 206F does not give reports prepared by liquidators pursuant to s 533 of the Act any particular status or weight. ASIC may approach the exercise of its power of disqualification under s 206F(1)(c) in any way it thinks fit, subject to complying with s 206F(1) and s 206F(2) and subject to respecting and applying the principles referred to in subpar (b) above.

…

28    The reference in the Full Court’s reasons to corporate officeholders who cause loss through “incompetence or dishonesty or a combination of the two” does not import a requirement that ASIC must be satisfied as to the existence of incompetence, dishonesty or both, before exercising the discretion in s 206F. Thus, in Scott v Australian Securities and Investments Commission [2010] FCA 424; (2010) 78 ACSR 399 at [12], Middleton J said:

In my view, the approach taken by the Tribunal in Quinlivan v Australian Securities and Investments Commission (2010) AATA 113 was correct when it explained the relationship between s 206F and other parts of the Corporations Act which impose duties on the directors. In Quinlivan, the Tribunal stated as follows:

We are not obliged to identify specific breaches of duty or contraventions of the law in order to pass judgment on the adequacy of Mr Quinlivan’s performance for the purposes of section 206F. See re Guss v Australian Securities and Investments Commission (2006) AATA 401; (2006) 90 ALD 349 at paragraph 48 per Deputy President Olney. While evidence of contraventions were obviously relevant to a decision to disqualify, the section has a different focus. The operation of the section is triggered by evidence of a pattern of failure. As the Tribunal explained in Re Andrews v Australian Securities and Investments Commission (2006) AATA 25 at [23]:

The provision was apparently enacted on the assumption that involvement in one failure might simply be unfortunate, but involvement in two or more separate failures could suggest carelessness and other breach of duty.

29    In Laycock v Forbes [1997] FCA 1322; (1997) 150 ALR 186, Goldberg J interpreted the predecessor of s 206F, s 600(3), in a similar manner and concluded at 193 that:

… It seems to me therefore that it does not necessarily follow that a disqualification order can only be made after there is established some conduct which is in breach of standards of commercial morality or involves gross incompetence. As s 600(2) entitles the Commission to give a notice to a person who is a relevant person in relation to two or more relevant bodies it seems to me that the legislation contemplates that it would be open to the Commission to serve a notice on a person prohibiting him or her from managing a corporation simply because that person had been a director of two or more companies which had been unable to pay their unsecured creditors more than fifty cents in the dollar. Putting the matter another way, the power given to the Commission under s 600 may be exercised because of the fact of such an association independently of pointing to any particular default on the part of the person to whom the notice is addressed.

30    Accordingly, the Tribunal was not required to make any specific finding concerning Mr Zivanovic’s competence and ground 2 discloses no error on a question of law.

31    In any event, as ASIC’s submissions observed, the Tribunal did have regard to Mr Zivanovic’s competence as a manager of corporations and made findings that reflect adversely on his competence. Particularly, at para 122 of its reasons, the Tribunal noted that Mr Zivanovic conceded a “history of poor corporate management”, which was said to be:

… significant – to the extent that it covers a period going back to at least 2010 and involves (at least) … 18 companies … [covering] three different areas of activity – the various property development enterprises, the building and construction activities of Devlaw and Kakconab and finally, the “migration” of the apparently successful scaffolding business of Fratocom into the new corporate structure of Erect Safe Scaffolding (NSW) Pty Ltd – against the background of an apparently long standing failure to discharge its income tax obligations.

32    Further, at para 123, the Tribunal stated:

It is also significant to take into account the extent of the total deficiency that arose from the insolvencies of the various companies. The $26.4m total was a large default in itself. And although it was predominantly borne by entities that may be described as relevantly associated with [Mr Zivanovic] himself, it is in itself an indication of the magnitude and seriousness of his past inadequacy in the management of corporations for which he was, for all practical purposes, the sole controller. The materiality of that indication is perhaps underscored by [Mr Zivanovic’s] concession that he probably did not understand the nature and extent of his obligations as a director …

33    Finally, at para 87 of its reasons, the Tribunal referred to Mr Zivanovic’s own acknowledgment:

… that he had operated too much on his own, not paid sufficient attention to matters of planning, cash flow management, governance and compliance, and that he “could, and should, have taken more effective control and management of the failed companies”. Indeed, at one point in his cross examination [Mr Zivanovic] said that he did not think that he had actually been aware of his duties as a director at the time of the liquidation of the various companies.

Ground 3 – Error in disqualifying Mr Zivanovic despite absence of finding that disqualification required for public protection

34    Mr Zivanovic’s written submissions contend that the Tribunal “expressly declined to exercise the disqualification discretion in reliance upon any need to protect the public”, referring to para 121 of the Tribunal’s reasons. Para 121 states:

I accept the proposition that [Mr Zivanovic] has had substantial sanctions visited upon him – as a result of the “related” unsecured liabilities indicated in Schedule 1, ASIC’s decision, and the management changes he has caused to be implemented within the group. If the likelihood of future management deficiencies were the only material considerations, I would be disinclined to regard his disqualification as justified, even taking into account the December 2014 convictions on which ASIC relied. (I regard the non-production as aberrant, rather than typical.) However, it is not the only, nor in my opinion, the determinative consideration.

35    In my view, para 121 indicates that the Tribunal did not consider that the likelihood of future management deficiencies would have justified disqualification. It says nothing about protection of the public or whether public protection involves only protection from future management deficiencies.

36    Mr Zivanovic next argued that the disqualification decision was “confirmed in reliance upon general deterrence, in circumstances where the primary purpose for which the power to disqualify was enacted could not justify doing so”, and this involved an error on a question of law.

37    Mr Zivanovic correctly acknowledged that general deterrence is a relevant consideration.

38    The Tribunal’s reasons for concluding that the disqualification was justified are set out at paras 121 to 126. They included:

(1)    Mr Zivanovic’s conceded history of poor corporate management;

(2)    the extent of the total deficiency that arose from the relevant insolvencies, this being said to indicate Mr Zivanovic’s past inadequacy in the management or corporations for which he was, for all practical purposes, the sole controller;

(3)    Mr Zivanovic’s concession that he probably did not understand the nature and extent of his obligations as a directors; and

(4)    the Tribunal’s view that there was relevant “parity” between Mr Zivanovic’s case and the case of Aghili v Australian Securities and Investments Commission [2012] AATA 353 in which a three year disqualification was imposed.

39    I accept that the Tribunal’s conclusion was ultimately based on considerations of general deterrence. Such general deterrence is an important object of a disqualification order, as the Tribunal recognised at para 110 of its reasons, citing Australian Securities and Investments Commission v Forge [2007] NSWSC 1489 at [103]. The Tribunal was therefore correct to proceed on the basis that considerations of general deterrence might justify a disqualification under s 206F.

40    Accordingly, ground 3 does not identify any error by the Tribunal on a question of law.

Grounds 4 and 5 – Failure to consider and provide reasons in respect of s 206F(5)

41    Section 206F(5) provides:

ASIC may give a person who it has disqualified from managing corporations under this Part written permission to manage a particular corporation or corporations. The permission may be expressed to be subject to conditions and exceptions determined by ASIC.

42    Mr Zivanovic’s request that the Tribunal exercise the power under s 206F(5) to permit him to act as a director of several of the relevant companies was addressed in para 128 of the Tribunal’s reasons as follows:

… [T]he basis for [Mr Zivanovic’s] submission [that the Tribunal should exercise its power under s 206F(5)] was, in essence, the apprehended risk of the adverse effect that disqualification might have on those companies. I have earlier set out my reasons for concluding that the risk was not significant. Accordingly, and assuming that the Tribunal could exercise the Corp Act 206F(5) power in the present proceedings, I am not satisfied there is a sufficient reason to so do.

43    The notice of appeal contends that the Tribunal erred on a question of law:

(1)    by failing to give genuine, proper and realistic consideration to Mr Zivanovic’s case for permission to manage particular corporations; and

(2)    in the alternative, by failing to adequately expose the process of reasoning which led it to refuse to grant that permission.

44    Mr Zivanovic’s written submissions contended that, in considering whether to grant permission, the Tribunal was required to take into account:

(1)    that it had not found that disqualification was justified to protect the public from Mr Zivanovic’s dishonesty or incompetence;

(2)    Mr Zivanovic’s demonstrated history of competence, particularly since 2014; and

(3)    the beneficial changes made with respect to corporate governance.

45    I do not accept that submission. Section 206F(5) requires the decision-maker to consider whether to give permission of the kind sought, despite a disqualification decision. Having found that considerations of general deterrence justified disqualification, it would have been perverse to give Mr Zivanovic permission under s 206F on the basis of any of (1) to (3) above.

46    In the written submissions, there was a factual dispute as to the basis upon which Mr Zivanovic sought permission under s 206F(5). ASIC said that the basis is correctly identified in para 108 of the Tribunal’s reasons. In oral submissions, counsel for AISC, Mr Free, supported that submission by reference to Mr Zivanovic’s written submissions to the Tribunal that he should be permitted to be a director:

… of the ultimate holding companies of each of the development and scaffolding businesses …

… in reliance upon the asserted real and substantial risk that, if the applicant is disqualified from being a company director, the viability of the business and thus the companies through which they are conducted, will become problematic.

47    Counsel for Mr Zivanovic, Mr Coleman SC, did not dispute Mr Free’s submission in reply. Accordingly, I accept that para 128 accurately identified the basis upon which Mr Zivanovic sought permission under s 206F(5).

48    Orally, Mr Coleman SC argued that there was a range of findings made by the Tribunal, favourable to Mr Zivanovic, which could and should have been considered by the Tribunal in deciding whether to exercise the power in s 206F(5).

49    I do not accept that the Tribunal erred in either of the ways identified by grounds 4 and 5 of the notice of appeal. Paragraph 128 reveals that the Tribunal considered the request for permission and the basis of the request and concluded that the permission should not be granted because the basis of the request was an apprehended risk that it had already found not to be significant. The Tribunal’s reasons do not reveal any failure to give proper consideration to the request for permission and the reasons are logical and were open to the Tribunal.

50    Finally, I do not accept that it was necessary for the Tribunal to consider the findings that had been made in favour of Mr Zivanovic for the purpose of deciding whether to give the permission sought. The Tribunal was required to make that decision against the background of its conclusion that disqualification was justified by considerations of general deterrence. In those circumstances, as ASIC submitted, the exercise of s 206F(5) would be expected to be directed to the circumstances of particular companies and whether the ongoing management of the individual was necessary or appropriate, notwithstanding the disqualification.

51    Accordingly, these grounds of appeal must fail.

Conclusion

52    The appeal must be dismissed. Costs should follow the event.

Associate:

Dated:    17 May 2018