144 Whether or not the magistrate also acted under s. 143(1) of the Fair Trading Act, it is clear from his reasons for decision that he considered Mr Cellante was directly liable for misleading or deceptive or unconscionable conduct engaged in by him as an employee on behalf of Astvilla and Perna. He applied the requirement that the employee must not have acted merely as a conduit[27] and made all the findings necessary for Mr Cellante to be directly liable.
145 It is therefore necessary to decide whether, under ss. 7(1) or 9(1) of the Fair Trading Act, an employee can be directly liable for misleading or deceptive conduct, or unconscionable, conduct engaged in for an employer.
146 In some cases the issue is whether, in the criminal law context, the contravening conduct of an employee can be attributed to a company for the purposes of shooting home liability to the company. I have recently dealt with this issue in another legislative context.[28] I there decided it was a question of construction whether the company could be so liable, and the policy of the legislation was an important consideration. The present case raises the opposite issue - the employee contends, in the civil law context, he cannot be found liable for his own contravening conduct because the company alone is so liable. I think the answer to this issue also lies in the proper construction of the legislation, taking its policy into account.
147 Sections 7(1) and 9(1) of the Fair Trading Act simply state that "a person must not, in trade or commerce, engage in" the proscribed conduct. A "person" here means a corporation and an individual.[29] The generality of the language strongly suggests the prohibitions were intended to apply to the conduct of any person, without qualification. Therefore, speaking generally, a person, in whatever capacity, in trade or commerce, engaging in conduct that is misleading or deceptive or unconscionable, is exposed to direct liability for the contravention.[30] The natural and ordinary meaning of the language is amply wide enough to support such a construction.
148 It has been said of s. 52 of the Trade Practices Act 1974 (Cth), and it may equally be said of ss. 7(1) and 9(1) of the Fair Trading Act 1999 (Vic), that "the nature of the prohibition imposed ...is ...governed by the terms in which it is created and the context in which it is found."[31] There is nothing in the terms of ss. 7(1) or 9(1) or in the context of the Fair Trading Act to warrant a narrow construction. To confine the operation of the provisions to non-employees, I would have to read down the word "person" to exclude employees and read in a requirement that the trade or commerce be that of the person themselves. Such a construction, quite apart from being contrary to high authority, as I will later show, would not promote the objects of the Act, the main ones of which I have already mentioned. A construction that gives effect to the generality of the language in ss. 7(1) and 9(1) does promote these objects and is to be preferred. As has also been said of s. 52(1) of the Trade Practices Act, the "generality of the language" of the provisions "must be afforded full weight within the framework" of the policy of the legislation.[32] The reasons that compelled me to adopt a narrow construction s. 143(1) may be starkly compared with the paucity of reasons for narrowly construing ss. 7(1) and 9(1).
149 As we have seen, Division 1 of Part 11 contains provisions for the enforcement of the Fair Trading Act against corporations and, under s. 143(1) and (2), officers who knowingly authorise or permit contravening conduct by corporations. The operation of these provisions is in no way affected if employees of corporations are directly liable for misleading or deceptive or unconscionable conduct of their own in their employer's trade or commerce. As an employee, the person is an "officer."[33] If they knowingly authorise or permit the contravention, they are liable to prosecution for an offence under s. 143(2). If they engage in the contravening conduct, they are directly liable, both to prosecution and civil action. The criminal or civil liability of the corporation is not affected.
150 In s. 145 of the Fair Trading Act 1999 as originally enacted[34] there were positive indications that employees could be directly liable. In summary, s. 145 made the conduct of an agent or employee, within the scope of their actual or apparent authority, "also" the conduct of their employer.[35] The provisions operated so that, where an agent or employee of another person or company engaged in conduct within the scope of their actual or apparent authority, the conduct was deemed "also" to have been engaged in by the other person or company. The assumption behind these provisions was that the conduct was substantively that of the agent or employee. I think ss. 7(1) and 9(1) operate on the same basis.
151 We know that, by the Fair Trading (Amendment) Act 2003, s. 145 was substituted with a "person involved" provision in familiar terms. It makes aiders and abetters and other specified persons liable for the conduct of the primary contravener.[36] We also know such a provision, until 2003, was absent from the Fair Trading Act 1999. It was therefore missing at the time the events at issue in the present case occurred. Therefore, it cannot be argued in this case that there is an inconsistency between an employee being both directly liable under ss. 7(1) or 9(1) and liable as an accessory under an accessorial provision like the current s. 145.[37]
152 If I thought this temporary lack of an accessorial provision affected the analysis, I would review my overall conclusion. I do not think it does, for the following reasons.
153 We have seen that the Fair Trading Act 1985 in its original form contained, in s. 31, a provision like the current s. 145. It seems to have been left out of the 1999 Act by mistake. In relation to the substantive liability of employees, the Parliament would not have intended the 1985 Act and the Act as amended in 2003 Act to operate differently to the pre-amended 1999 Act. And if we examine the direct liability of employees under s. 11(1)[38] of the 1985 Act and ss. 7(1) and 9(1) of the Act as amended in 2003, we see such direct liability does not detract from the operation of s. 31 of the former or s. 145 of the latter. Under the 1985 Act and the Act as amended in 2003, an employee, acting as something more than a mere conduit, might be directly liable for misleading or deceptive or unconscionable conduct in their employer's trade or commerce because the contravening conduct was their own; alternatively the employee might the liable as an accessory because they were an intentional[39] participant in contravening conduct of their employer. By contrast, under the pre-amended 1999 Act, which lacked the accessorial provision, the employee could only be directly liable. For these reasons, I think direct liability of employees was a feature of the legislation from the start, and still is.
154 For these reasons, treating the issue as one of pure statutory construction, I would conclude employees can be directly liable for conduct of their own, done in the course of their employer's trade or commerce, which contravenes ss. 7(1) or 9(1) of the Fair Trading Act.
155 Let me now turn now to the decided cases.
156 Prior judicial consideration of this issue may be grouped into three categories - decisions concerning estate agents, company directors and employees.
157 The Full Court of the Federal Court held an estate agent directly liable in John G Glass Real Estate Pty Limited v Karawi Constructions Pty Limited.[40] This was a misleading and deceptive conduct case under s. 52 of the Trade Practices Act 1974 (Cth). The agent engaged in conduct beyond "merely passing on information."[41] However the Full Court saw the agent's conduct as an ordinary part of the business of an estate agent, not part of the business of its principle. The case is therefore not an exact analogy with the present, where the employee - Mr Cellante - was acting in his employer's business. In Pricom Pty Ltd v Sgarioto[42] Eames J (as he then was) decided an estate agent who had contravened s. 11(1) of the Fair Trading Act 1985 (Vic) was directly liable. But again, the basis of the decision was that the estate agent, a company, was engaged, through its employee, in "its own trade and commerce."[43]
158 The position of a company director is more closely analogous to that of an employee. There have been several cases in which directors have been held liable, not as accessories to their company's conduct, but directly for their own conduct.
159 Lauriana Pty Ltd v Corfield Food Warehouse Pty Ltd[44] arose under the Fair Trading Act 1987 (WA). The directors made false and misleading statements on behalf of their company. The company was found liable under s. 52 of the Trade Practices Act. The directors were found liable, both as aiders and abetters under that Act and as direct contraveners under s. 10 of the Fair Trading Act. The directors were not engaged in an independent business; they were engaged in trade or commerce on their company's behalf, like an employee.
160 Another Western Australian case, but in the Full Court of the Federal Court of Australia, is Arktos Pty Ltd v Idyllic Nominees Pty Ltd.[45] One question was whether a director was directly liable under s. 10. The answer given by Carr, Tamberlin and RD Nicholson JJ could not have been clearer: