Australian Building and Construction Commissioner v Construction, Forestry, Maritime, Mining and Energy Union

Federal Court of Australia|2021-05-19|Before: Mr P, Rares J

THE COURT DECLARES THAT:

On 25 January 2019, the Second Respondent (Mr Kera), being an officer and employee of the First Respondent (CFMMEU) and acting within the scope of his actual or apparent authority within the meaning of s 94 of the Building and Construction Industry (Improving Productivity) Act 2016 (Cth) (BCIIP Act), contravened s 47(1) of the BCIIP Act by engaging in an unlawful picket at 15 Hale Street, Botany in the State of New South Wales (the Botany Cranes Yard) of Griffiths Cranes Pty Ltd (t/as Botany Cranes) (Botany Cranes) (the Kera s 47 Contravention).
On 25 January 2019, the Third Respondent (Michael Greenfield), being an officer and employee of CFMMEU and acting within the scope of his actual or apparent authority within the meaning of s 94 of the BCIIP Act, contravened s 47(1) of the BCIIP Act by organising and engaging in an unlawful picket at the Botany Cranes Yard (the Michael Greenfield s 47 Contravention).
On 25 January 2019, the Fifth Respondent (Ms Mallia), being an officer and employee of CFMMEU and acting within the scope of her actual or apparent authority within the meaning of s 94 of the BCIIP Act, contravened s 47(1) of the BCIIP Act by engaging in an unlawful picket at the Botany Cranes Yard (the Mallia s 47 Contravention).
On 25 January 2019, the Seventh Respondent (Mr Byrnes), being an agent and member of CFMMEU and acting on behalf of the CFMMEU in performing the function of dealing with his employer, Botany Cranes, on behalf of himself and other members of the CFMMEU and acting within the scope of his actual or apparent authority within the meaning of ss 94 and 95 of the BCIIP Act, contravened s 47(1) of the BCIIP Act by engaging in an unlawful picket at the Botany Cranes Yard (the Byrnes s 47 Contravention).
On 25 January 2019, Mr Kera, being an officer and employee of CFMMEU and acting within the scope of his actual or apparent authority within the meaning of s 94 of the BCIIP Act, contravened s 52(a) of the BCIIP Act by taking action at the Botany Cranes Yard against, and with intent to coerce, Botany Cranes to employ Mr Byrnes (the Kera s 52 Contravention).

Penalties 15. Mr Kera pay to the Commonwealth of Australia a pecuniary penalty of: (a) $35,000 in respect of the Kera s 52 Contravention, (b) $12,500 in respect of the Kera s 47 Contravention. 16. Michael Greenfield pay to the Commonwealth of Australia a pecuniary penalty of: (a) $25,000 in respect of the First Michael Greenfield s 52 Contravention, (b) $10,000 in respect of the Michael Greenfield s 47 Contravention, (c) $30,000 in respect of the Second Michael Greenfield s 52 Contravention, (d) $35,000 in respect of the Michael Greenfield s 54 Contravention. 17. Ms Mallia pay to the Commonwealth of Australia a pecuniary penalty of: (a) $15,000 in respect of the Mallia s 52 Contravention, (b) $5,000 in respect of the Mallia s 47 Contravention. 18. Mr Byrnes pay to the Commonwealth of Australia a pecuniary penalty of: (a) $3,500 in respect of the Byrnes s 52 Contravention, (b) $1,500 in respect of the Byrnes s 47 Contravention. 19. The CFMMEU pay within 28 days of these orders: (a) a pecuniary penalty of $500,000 in respect of the contraventions of ss 47(1) and 52(a) of the BCIIP Act referred to in Declarations 11 and 12, (b) a pecuniary penalty of $175,000 in respect of the contravention of s 52(a) of the BCIIP Act referred to in Declaration 13, (c) a pecuniary penalty of $175,000 in respect of the contravention of s 54(1) of the BCIIP Act referred to in Declaration 14. by paying: (d) out of the penalty in order 19(a): (i) $30,000 to Griffiths Cranes Pty Ltd (t/as Botany Cranes), (ii) $2,500 to Rhonda Hodges, (iii) $15,000 to the New South Wales Police Force, and (e) the balance to the Commonwealth of Australia.

Personal Payment orders 20. Within 90 days of these orders, Mr Kera pay the pecuniary penalties in order 15 above (Kera Penalty) to the Commonwealth of Australia personally in that he not, whether before or after the payment of the Kera Penalty: (a) seek to have or encourage the CFMMEU in any way whatsoever, directly or indirectly, to pay him, or for his financial benefit in any way whatsoever, any money or financial benefit referable to the payment of the penalties, whether in whole or in part; and (b) accept or receive from the CFMMEU in any way whatsoever, directly or indirectly, any money or financial benefit referable to the payment of the penalties, whether in whole or in part. 21. Within 90 days of these orders, Michael Greenfield pay the pecuniary penalties in orders 16(a), (b) and (c) totalling $65,000 (Michael Greenfield Penalty) to the Commonwealth of Australia personally in that he not, whether before or after the payment of the Michael Greenfield Penalty: (a) seek to have or encourage the CFMMEU in any way whatsoever, directly or indirectly, to pay him, or for his financial benefit in any way whatsoever, any money or financial benefit referable to the payment of the penalties, whether in whole or in part; and (b) accept or receive from the CFMMEU in any way whatsoever, directly or indirectly, any money or financial benefit referable to the payment of the penalties, whether in whole or in part. 22. Within 90 days of these orders, Ms Mallia pay the pecuniary penalties in order 17 (Mallia Penalty) to the Commonwealth of Australia personally in that she not, whether before or after the payment of the Mallia Penalty: (a) seek to have or encourage the CFMMEU in any way whatsoever, directly or indirectly, to pay her, or for her financial benefit in any way whatsoever, any money or financial benefit referable to the payment of the penalties, whether in whole or in part; and (b) accept or receive from the CFMMEU in any way whatsoever, directly or indirectly, any money or financial benefit referable to the payment of the penalties, whether in whole or in part. 23. Within 90 days of these orders, Mr Byrnes pay the pecuniary penalty in order 18(a), being $3,500 (Byrnes Penalty), to the Commonwealth of Australia personally in that he not, whether before or after the payment of the Byrnes Penalty: (a) seek to have or encourage the CFMMEU in any way whatsoever, directly or indirectly, to pay him, or for his financial benefit in any way whatsoever, any money or financial benefit referable to the payment of the penalties, whether in whole or in part; and (b) accept or receive from the CFMMEU in any way whatsoever, directly or indirectly, any money or financial benefit referable to the payment of the penalties, whether in whole or in part.

Costs 24. The Respondents pay the Applicant's costs in the agreed sum of $133,000 within 28 days.

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

RARES J: 1 On 22 April 2021, I published my reasons (Australian Building and Construction Commissioner v Construction, Forestry, Maritime, Mining and Energy Union (No 3) (The Botany Cranes Case) [2021] FCA 363) (the principal reasons) and provided the parties with the orders that I proposed to make. I will use in these reasons the defined terms that I used in the principal reasons. I ordered the parties to make submissions as to whether those orders should be made and whether they should also include that: some of the $500,000 that the Union should pay for its contraventions of ss 47(1) and 52(a) of the Building and Construction Industry (Improving Productivity) Act 2016 (Cth) on 25 January 2019 be paid under s 81(5) to Ms Hodges or the New South Wales Police Force (the other payee issue), and there be a non-indemnification or personal payment order in respect of the penalty to be imposed on Mr Byrnes (the Mr Byrnes non-indemnification issue).

The parties' submissions 2 The Commissioner supported the making of an order under s 81(5) for payments to each of Ms Hodges and the police of part of the $500,000 penalty to be imposed on the Union for its contraventions of ss 47(1) and 52(a) of the Act on 25 January 2019. He submitted that in assessing the amount of any such penalty that should be paid to a third party in their position, it was relevant to consider the sum that would compensate each of Ms Hodges and the police for the effects of the Union's contravening conduct on 25 January 2019. 3 The Commissioner suggested that, on the assessment of the part of the penalty that should be paid to her, Ms Hodges' distress and hurt to her feelings could be evaluated like damages recoverable for personal injuries and that this would assist in fixing the appropriate sum to be paid as a penalty to her out of the $500,000. The Commissioner obtained from the South Sydney Police Area Command a breakdown of their costs, totalling $3066.60 expended in dealing with the unlawful picket and coercive action on 25 January 2019. The Commissioner noted that those costs did not include the time taken by four police officers in preparing witness statements for this proceeding. The Commissioner accepted that he had not sought any orders for compensation under s 81(1)(b), but contended that there was no prejudice to the Union if a direction were made, under s 81(5), that part of the penalty imposed on it be paid to Ms Hodges and the police. 4 The Union argued that there was no power under s 81(5) to make an order for payment of a penalty to more than one person. It relied on the fact that, unlike s 81(5) of the Act, s 546(3) of the Fair Work Act 2009 (Cth) expressly conferred a power on the Court to order that parts of a penalty be paid to different persons. The Union contended that the power in s 546(3) allowing the Court to apportion payment of a penalty was new, and had changed the previous law under which a common informer could sue to recover a civil penalty. It referred to Sayed v Construction, Forestry, Mining and Energy Union (2016) 239 FCR 336 at 346-350 [60]-[75]. The Union also argued that the purpose of the power to order a penalty under s 81(5) is to penalise and deter, not compensate. I note that the Union had not made such an argument earlier in relation to the Commissioner's application that some part of the penalty should be payable to Botany Cranes. 5 The Commissioner confirmed that he did not seek a non-indemnification or personal payment order in respect of Mr Byrnes, who made common cause with him on this issue. In particular, Mr Byrnes argued that he had admitted liability on the basis that no such order was, or would be, sought and that settlements would be discouraged if it were now made. Mr Byrnes contended that, if I made a non-indemnification order despite the combined stance of the parties, predictability in civil penalty proceedings would be undermined and that he would suffer significant injustice, since he could not now withdraw his admissions. He relied on what Rangiah J had held recently in Australian Building and Construction Commissioner v Construction, Forestry, Maritime, Mining and Energy Union (The North Queensland Stadium Case) (No 2) [2021] FCA 105 at [69]-[70].

The other payee issue 6 I reject the Union's argument that s 81(5) does not confer power to order that part of a penalty be paid to a person other than the applicant in a proceeding seeking to recover a pecuniary penalty under s 81(1)(a) of the Act. First, s 81(5) allows the Court to direct that a penalty be payable to the Commonwealth or some other person. The Acts Interpretation Act 1901 (Cth) provides in s 23(b) that words in the singular number include the plural. Accordingly, the expression "some other person" includes more than one person. Secondly, s 81(5) confers a broad discretionary power on the Court in relation to directing to whom a penalty is to be payable. 7 Mason CJ, Brennan, Deane, Dawson, Toohey, Gaudron and McHugh JJ held in The Owners of the Ship "Shin Kobe Maru" v Empire Shipping Company Inc (1994) 181 CLR 404 at 421 that: It is quite inappropriate to read provisions conferring jurisdiction or granting powers to a court by making implications or imposing limitations which are not found in the express words. (citation omitted) 8 Stephen, Mason, Murphy, Aickin and Wilson JJ explained the principle applicable to the construction of a statutory discretion in The Queen v Australian Broadcasting Tribunal; Ex parte 2HD Pty Limited (1979) 144 CLR 45 at 49 as follows: In the absence of some positive indication of the considerations on which a grant or refusal of consent is to depend, the discretion is "unconfined, except insofar as the subject matter, scope and purpose of the statutory enactment may enable the court to pronounce given reasons to be definitively extraneous to any objects the legislature could have had in view", to use the words of Dixon J in [Water Conservation and Irrigation Commission (NSW) v] Browning [(1947) 74 CLR 492 at 505] (emphasis added) 9 There is nothing in the text of the Act nor is there any evident policy reason why the Parliament would have intended that the Court's power to make a direction under s 81(5) should be confined to a single object. The Parliament would have understood that a contravention of the Act could affect more than one person and that such persons, as authorised applicants under s 81(1)(a), could make an application for a pecuniary penalty. If they succeeded in obtaining an order that the contravener pay a pecuniary penalty, they might seek a direction under s 81(5) that the penalty be paid to them, in parts, severally or, if the Court directed, in part to them, leaving the remaining part to be paid to the Commonwealth. 10 Thirdly, the Union's argument based on the wording of s 546(3) of the Fair Work Act ignores the fact that s 81(5) is in a different statute and each provision is expressed in different terms. The task of statutory construction must begin with the text of the statute as enacted (see eg Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (Northern Territory) (2009) 239 CLR 27 at 46-47 [47]-[48] per Hayne, Heydon, Crennan and Kiefel JJ). It is not appropriate to begin with considerations of what the legislature did not enact or enacted in a different Act. And, the Act must be read and construed as a whole. Moreover, s 81(5) allows the Court to direct that the penalty be payable to some other person instead of to the Commonwealth and to be recoverable as a debt. And, s 81(7) appropriates the Consolidated Revenue Fund "for the purposes of a debt due to a person other than the Commonwealth in relation to a penalty under [s 81(1)(a)]" (emphasis added). 11 The purpose of s 81(7) appears to be that the Consolidated Revenue Fund can be used to pay the amount of the penalty to a person the subject of a direction under s 81(5) leaving the Commonwealth free to recover the whole of the penalty as a debt due to it under s 81(5). In that way, the Commonwealth will be able to recoup what was appropriated without the person needing to take any recovery proceeding. There would be no need to make an appropriation under s 81(7) "in relation to" such a debt unless the purpose of the power to make a direction under s 81(5) were that the amount of the debt the subject of the direction would be paid by the Commonwealth to the person, while the right to enforce the penalty would remain in the Commonwealth. Of course, if the contravener paid the person in favour of whom the Court had made a direction under s 81(5), that payment would discharge pro tanto any joint liability also owed to the Commonwealth. The fact that the Act contemplates such a situation suggests that s 81(5) allows the Court to direct that part or parts of the penalty be payable to one or more persons as well as to the Commonwealth. 12 In Sayed 239 FCR at 350 [78], 353-354 [101]-[102], Tracey, Barker and Katzmann JJ held that a civil pecuniary penalty is ordinarily payable to the applicant or person who seeks it in the proceeding, but a provision, such as s 546(3) of the Fair Work Act, gave the Court a discretion to vary that result. Their Honours approved what Gilmour J had said in Woodside Burrup Pty Ltd v Construction, Forestry, Mining & Energy Union (2011) 220 FCR 551 in relation to the predecessor of s 81(5) (namely, s 49(5) of the Building and Construction Industry Improvement Act 2005 (Cth)) that payment of such a penalty is not compensatory (239 FCR at 354-355 [108]-[112]). 13 The power under s 81(5) is to direct to whom the penalty overall is payable. The penalty itself is imposed under s 81(1)(a) and its amount does not change as a consequence of any direction under s 81(5). The quantum of any penalty must achieve the purpose of deterrence, as I explained in the principal reasons. The purpose that the power under s 81(5) serves must be to allow the Court to make an order for the payment of the quantum of the penalty to the Commonwealth and or some other person or persons, including, but not limited to, an authorised person as defined in s 5 (including the Commissioner and a person affected by the contravention) in a manner consistent with the main object of the Act in s 3, that will achieve a just outcome in the circumstances. 14 Here, Ms Hodges was an innocent victim of the coercion and unlawful picket for which the Union is liable: see the principal reasons at [120]-[121]. The purpose of a payment to her of part of the penalty of $500,000 that I imposed on the Union for its multiple contraventions of ss 47(1) and 52(a) on 25 January 2019 is not compensatory. The purpose is to impose a sting or burden on the contravener to deter that person and others from engaging in similar conduct in the future: Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (2018) 262 CLR 157 at 195-196 [116]-[117] (The Non-Indemnification Case) per Keane, Nettle and Gordon JJ. 15 The police attended outside Botany Cranes' premises on 25 January 2019, in considerable numbers, to keep the peace. Of course, that is part of the function of a police force, but their presence was only necessary because of, and the attending officers were exposed (in the line of duty, no doubt) to, the risk that matters may get out of hand having regard to the lack of any lawful basis for the picket and coercive action: see the principal reasons at [71]-[73], [79]. The police resources of the State of New South Wales had to be deployed to deal with that unlawful conduct. In that circumstance, it is in the interests of justice that one body politic, the Commonwealth, not receive all of the pecuniary penalty imposed to deter the contravention of the law as part of its enforcement, when another body, the State, had to provide its resources to prevent the possibility of a breach of the peace or worse. 16 In my opinion, the purpose of deterrence will also be advanced if contraventions of the Act, such as the Union's on 25 January 2019, can attract payment of the whole or part of the penalty to the police force, or the Government of the State or Territory whose police force has to be deployed to keep the peace, exposing those officers to unnecessary potential to be injured and diverting them from carrying out their other duties. 17 In all of the circumstances, I consider that a direction under s 81(5) should be made that part of the $500,000 penalty imposed for the Union's contraventions of ss 47(1) and 52(a) on 25 January 2019 be paid as follows: $30,000 to Botany Cranes, $2,500 to Ms Hodges, $15,000 to the police and the balance to the Commonwealth.

The Mr Byrnes non-indemnification issue 18 Here, the parties' agreement to resolve the liability issues went no further than that the Commissioner would not seek that there be a non-indemnification or personal payment order in respect of Mr Byrnes. That agreement was reflected in the further amended originating application, where the Commissioner specifically sought non-indemnification or personal payment orders in respect of Mr Kera, Michael Greenfield and Ms Mallia, but not Mr Byrnes. However, the parties left it to the Court to determine what penalty should be imposed. 19 The power to make a pecuniary penalty order under s 81(1)(a) of the Act carries with it the power to make the person ordered to pay it to do so personally. That is to ensure that the effect of the order to pay the penalty will carry with it "the reality of a pecuniary penalty which is critical to the attainment of the deterrent effect which is the very point of the penalty": The Non-Indemnification Case 262 CLR at 173 [44] per Kiefel CJ. The power is implicit in s 81(1)(a) and enables the imposition of a penalty to accomplish the legislative purpose of specific and general deterrence: The Non-Indemnification Case 262 CLR at 173 [44], 174 [49] per Kiefel CJ, and see too at 196-198 [119]-[120], [123] per Keane, Nettle and Gordon JJ. As Keane, Nettle and Gordon JJ held (at 199 [125]), when a court has to impose a pecuniary penalty: the exercise is one of accomplishing the level of sting or burden which the court determines is necessary to be imposed, and thus in each case the exercise is one of doing what is necessary to accomplish the specific remedy of a pecuniary penalty order calculated to achieve the appropriate degree of deterrence. (emphasis added) 20 In The North Queensland Stadium Case (No 2) [2021] FCA 105 at [63]-[70], Rangiah J said that r 8.03 of the Federal Court Rules 2011 requires that an originating application state the relief that the applicant seeks, and, where that relief includes an injunction, the terms of such an order. His Honour reasoned that, there, based on the relief claimed in the originating application, the individual respondent had not been on notice that a non-indemnification or personal payment order was sought. His Honour considered that that circumstance may have affected the individual's decisions in his conduct of the proceeding, including in agreeing and making admissions as to the facts of his contravening conduct. His Honour found that, there, one respondent, a Mr Harradine, was an official employed by the Union as an organiser (at [6]). Rangiah J concluded that, in those circumstances, it would not be just to grant the Commissioner leave to amend the originating application to seek a non-indemnification order. He said (at [68]): I do not accept the Commissioner's submission that no prejudice would be caused to Mr Harradine by reason of the amendment. Mr Harradine's conduct occurred in the course of his employment and, ordinarily, the Union could be expected to indemnify him against payment of the penalty. The purpose of a personal payment order would be to deter Mr Harradine from future contraventions by requiring him to pay the penalty using his own finances. A personal payment order would create significant financial consequences for Mr Harradine. (emphasis added) 21 With respect, I am unable to accept that reasoning. The only purpose of the power to order pecuniary penalty under s 81(1)(a) is to achieve or promote deterrence. While an employee of the Union may have had some expectation that it would indemnify him or her, I am of opinion that such an expectation is irrelevant to the exercise of the Court's power to impose a penalty. No person, including the Union, can authorise, or create an expectation that by doing that person's biding his, her or its employees will be shielded from the consequences of, a contravention of a norm of conduct established by an Act of the Parliament. 22 It is no part of the duty of the Court, in exercise of the judicial power of the Commonwealth, to recognise or encourage an expectation that an employee or other agent can be indemnified from bearing the sting or burden of a pecuniary penalty for contravening the law in performance of an activity directed, authorised or encouraged by his or her employer. The employee is bound to obey the law as enacted by the Parliament, regardless of any instruction or expectation of his or her employer to do otherwise, and the Court is bound to enforce that law. Here, the only purpose of a pecuniary penalty, under s 81(1)(a), is deterrence. The Court cannot decline to give a penalty the sting or burden it is imposed to achieve by refraining from making a non-indemnification or personal payment order on an employee on the ground of an expectation that his or her employer, or a third party, would pay the penalty. If the Court were to entertain such a reasoning process, the law would not apply to all persons equally, and such an employee would feel empowered to contravene the law in the future (as the culture of the Union clearly encourages) because there would be no effective consequence under the law for him or her in doing so. 23 I am of opinion that it is wrong in principle to regard a non-indemnification or personal payment order as distinct or different from the actual imposition of a civil pecuniary penalty. The power to impose the penalty includes the power to make a non-indemnification or personal payment order to achieve the object of that remedy created by the Parliament - namely, deterrence. There can be no prejudice to the individual whose contravention of the law warrants the imposition of a civil pecuniary penalty that the Court, of its own motion, imposes also a non-indemnification or personal payment order on him or her in order to avoid the penalty having no impact on the actual contravener because of an expectation that his or her employer, or a third party, would otherwise pay the penalty. 24 A non-indemnification or personal payment order is a means of achieving deterrence. I reject Mr Byrnes' argument based on Rangiah J's refusal to allow the Commissioner to amend the originating application to seek a non-indemnification or personal payment order. In my opinion, such an order necessarily, if impliedly, is sought in any claim for a civil pecuniary penalty, namely a penalty fashioned so as to be effective to achieve the statutory purpose of deterrence. The Non-Indemnification Case 262 CLR 157 determined that the power to order a pecuniary penalty carries implicitly with it the power to ensure that its 'sting or burden' is effective. Thus, a non-indemnification or personal payment order is part and parcel of the penalty, not distinct from it or a matter requiring specific pleading. 25 Moreover, the Court is not bound, when imposing a civil pecuniary penalty, by any agreement of the parties. As Wigney, Beach and O'Byran JJ held in Volkswagen Aktiengesellschaft v Australian Competition and Consumer Commission [2021] FCAFC 49 at [126] and [131]: … The desirability of the Court accepting a proposed agreed penalty which it is persuaded is an appropriate penalty derives primarily from a public policy consideration; the promotion of predictability of outcome in civil penalty proceedings: [The Commonwealth of Australia v Director,] Fair Work [Building Industry Inspectorate (2015) 258 CLR 482; [2015] HCA 46] at [46]. Predictability of outcome encourages corporations to acknowledge contraventions, which, in turn, assists in avoiding lengthy and complex litigation. It should be emphasised, however, that this public policy consideration is but one of the relevant considerations to which the Court must have regard and, more significantly, it cannot override the statutory directive for the Court to impose a penalty that is determined to be appropriate. … … The overriding statutory directive is for the Court to impose a penalty which is determined to be appropriate having regard to all relevant matters. The fact that the regulator and the contravener have agreed and jointly proposed a penalty is plainly a relevant and important matter which the Court must have regard to in determining an appropriate penalty. It does not follow, however, that the determination is not discretionary in nature. (emphasis added) 26 I have now given Mr Byrnes the opportunity, which he has used, to be heard on the question of whether I should impose a non-indemnification or personal payment order. In my opinion, such an order is necessary to deter Mr Byrnes and others from engaging in similar contravening conduct to that in which he engaged on 25 January 2019 and because the Union has an embedded culture to treat the payment of penalties as a price of doing business. As I found in the principal reasons, Mr Byrnes has not expressed any contrition or acknowledgment that his conduct was unacceptable. The videos in evidence contained substantively the objective facts that established his participation in the unlawful picket and coercive conduct that constituted his contraventions of ss 47(1) and 52(a) on 25 January 2019. His agreement to the facts had some utilitarian value, but the independent evidence in the videos alone would have made such a finding inevitable, except in respect of Mr Byrnes' admission recorded in par 27(l) of the agreed facts, that he led chanting on the megaphone that the videos only recorded him as holding (see the principal reasons at [10] and [75]). 27 I do not consider that justice will be served by making an order that merely allows the Union to pay, as it and Mr Byrnes obviously intend, the whole of the penalty of $5,000 that will be imposed on Mr Byrnes. Such an unqualified order would not accomplish the statutory purpose of a pecuniary penalty, namely specific and general deterrence. Rather, the failure to impose a penalty that imposes a real sting or burden on Mr Byrnes would eschew the very object for which the penalty must be imposed: The Non-Indemnification Case 262 CLR at 199 [125]; Volkswagen [2021] FCAFC 49 at [126], [131]. I am of opinion that, in the circumstances, the parties' proposal that any penalty imposed on Mr Byrnes not include a non-indemnification or personal payment order, is not an appropriate remedy for his contraventions of the Act: The Commonwealth v Director, Fair Work Building Inspectorate (2015) 258 CLR 482 at 507 [58] per French CJ, Kiefel, Bell, Nettle and Gordon JJ. 28 Ordinarily, when a court imposes a fine or a civil pecuniary penalty on a person, the person pays it personally, as is the clear intention of the legislature in prescribing such a consequence for the person's contravention of the law. Such an outcome is what both the person and the community expect. As I have explained, Mr Byrnes' argument that somehow it would be unfair to require him personally to pay a penalty for his contraventions of the law defies both common sense and the legislative purpose inherent in s 81(1)(a). Indeed, the argument reduces to no more than an assertion that he was entitled to participate in this proceeding on the basis that he was not at risk of personally having to pay any penalty that the Court imposed on him and that it would be unfair to penalise him in that way. He seems to have proceeded (as the Union's embedded culture no doubt encouraged) on the assumption that the Court had to accept that the Union should pick up the bill for his contravention of the law and that it would be unfair to make him do so in order to deter him from engaging in similar conduct in the future. 29 For the reasons I have given, that argument is antithetic to the rule of law or, indeed, any respect for the law. While in some cases the circumstances may justify a third party making payment of a fine or penalty imposed on a contravener, there is nothing in the facts here to suggest that Mr Byrnes should not pay at least some part of the penalties that I have imposed out of his own resources. In my opinion, that is the only way that he, together with other members and officers of the Union, will be deterred from engaging in similar conduct in the future. He and they must be on notice that they personally, and not the Union, will be required by the Court to answer with their personal resources and finances for their conduct constituting any contravention that involves the Union's culture of contravening the law as a mere cost of doing business, as occurred in this matter. I consider that justice will be done if I make a non-indemnification order in respect of the $3,500 penalty that I imposed on Mr Byrnes for contravening s 52(a).

Conclusion 30 The parties raised no issue with the form of the draft orders that I provided to them on 22 April 2021 for consideration. In addition to those orders, I will make orders, reflecting these reasons, that the Union pay out of the $500,000 penalty imposed for its multiple contraventions of ss 47(1) and 52(a) on 25 January 2019, $2,500 to Mrs Hodges and $15,000 to the New South Wales Police Force, and that Mr Byrnes personally pay $3,500 out of the total penalty of $5,000 that I imposed on him. I certify that the preceding thirty (30) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Rares.

SCHEDULE OF PARTIES NSD 574 of 2019 Respondents Fourth Respondent: RITA MALLIA Fifth Respondent: HOWARD BYRNES

Building and Construction Industry (Improving Productivity) Act 2016(Cth)s 81(5), ss 3, 5, 47(1), 52(a), 81(1)(a), 81(1)(b), 81(5), 81(7)

Building and Construction Industry Improvement Act 2005(Cth)s 49(5)

Fair Work Act 2009(Cth)s 546(3)

At a glance

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