CONSIDERATION
16 I referred to the nature and circumstances of the offence in the primary judgment, and briefly above. I will not repeat that, save to note that at material times, the defendant was a proprietor of a chain of retail jewellery stores operating under the name of "Zamel's". It operated 69 retail stores throughout South Australia, Victoria, Western Australia, Tasmania and the Australian Capital Territory. The 2005 Christmas Sale Catalogue was distributed across each of those regions.
17 The catalogue was issued centrally, that is, through the defendant's head office. It, and the elements of it which contravened s 75AZC(1)(g) of the TP Act, were not the consequence of some local or store-based conduct. In fact, two of the defendant's directors were responsible for authorising the price of the jewellery items offered and advertised for sale, and for the issue of the catalogue.
18 On the other hand, the prosecutor does not controvert the defendant's assertion that the ticketed (and strike-through) price was a price determined by the defendant's own valuers as:
the market value of the item of jewellery, taking account of such things as replacement value for insurance purposes, and other market factors such as the fluctuating price of gold etc.
19 Quite what the "market value" so described represents is not further explained. There is no evidence about that. One might rhetorically ask why, if the jewellery items each had a ticketed (and strike-through) price which was its "market value", not one of them was ever sold for anything like that price in the period leading up to the Christmas sale. The defendant's valuers appear to have had a somewhat refined view of "market value". Whilst I accept that the valuers' "market value" may have given the defendant some basis for selecting a ticketed price for each of the jewellery items, the ticketed or strike-through price represented to a relevant group of consumers that during the sale period there would be a saving of the difference between the sale price and the strike-through price. The sales history referred to above demonstrates that that was not so. I do not accept, in the light of that sales history, that the defendant's ticketed price was a normal retail price, or one normally or not infrequently achieved, or one at which it anticipated it would be able to, or would, sell the offered items. But the evidence does not indicate that the defendant, through its directors or senior officers - those responsible for the promotion of the ticketed price - regarded the ticketed price as one at which the 11 jewellery items should in fact be sold or as being the "market" value, in the conventional sense as being the price at which a willing but not anxious buyer would buy them and a willing but not anxious seller would sell them. Nor does it suggest that they regarded that price as one which - if any of those items was sold but was lost - would be paid to secure a replacement. The justification for the ticketed price is not one which weighs much in favour of a lower penalty than otherwise, although I do take it into account in the defendant's favour because it demonstrates that the ticketed and strike-through price was not a contrived or randomly selected one.
20 However, the conduct of the defendant was deliberate. That is, it deliberately presented the catalogue in the way it did containing strike-through prices knowing that the 11 jewellery items had never been sold at those strike-through prices. In the primary judgment, I have recorded a general picture of the actual sales history of those items. The difference between the strike-through price and the actual previous highest price of each jewellery item is significant, and the suggested saving by the representations was also very significant: in all but one instance, the sale price was less than half the strike-through price.
21 The prosecutor contends that the Court should have regard to the fact that it had conducted a public awareness campaign directed to the jewellery industry in the latter months of 2005 and shortly before the contravening conduct. It says that the campaign was to assist retailers to comply with the law of comparison pricing and dual price advertising and to warn of the dangers of non-compliance with the TP Act. On 25 February 2005, the prosecutor issued a Media Release launching the "ACCC Guide to Price Comparison Advertising". On 5 September 2005 it issued a further media release launching a guide to fair trading in the jewellery industry, entitled "Advertising and promotion in the jewellery industry" in the form of a booklet. At the same time it issued a Check List for jewellery manufacturers, wholesalers, retailers and valuers. The first page of the Check List included the following, which the prosecutor says is directly relevant:
"You are likely to breach the Trade Practices Act if:
…
you refer to the "Was" price which is not a general previous selling price or, (sic) the goods were not offered for sale for a reasonable price at that "Was" price.
I do not take that into account as a factor adverse to the defendant in assessing penalty. The first reason is that I was not pointed to any evidence showing the defendant was aware of the detail of that material. The second reason is that, to some degree, the quoted part of that text is a little open-ended, where it refers to the alternative of a price at which the goods were previously "offered for sale". The defendant says that in fact, by its ticketed pricing, it in fact satisfied that alternative. Arguably it did so, although that might be qualified where a seller did not in fact realistically expect to sell any of those items at that price.
22 Indeed, the defendant sought to take advantage of that circumstance by saying that the catalogue relevantly was compiled in accordance with the Check List. I equally do not give the defendant credit for that. First, as I have said, the relevant passage in the Check List may have been taken to refer to ticketed prices at which the seller realistically expected to sell those items, and secondly because there is no evidence that the defendant adopted the strike-through price in the catalogue because it thought that in doing so it was complying with the Check List.
23 There is no evidence of any particular person or persons shown to have relied upon the conduct constituting the contraventions, so as to have suffered particular loss. The prosecutor's investigation into the defendant's conduct arose from an anonymous complaint. However, I do not accept the defendant's contention that its contravening conduct did not induce any consumer to buy one or other of the 11 jewellery items. After all, the purpose of the catalogue was to induce sales of the items depicted, and the point of the strike-through price was to provide to consumers a contrast with the sale price. In [6] above, I noted the difference between the total actual sale revenue from the 11 jewellery items during the sale and the sale period and the sale revenue if those items had been sold at the strike-through price. I do not assume that all those sales would have occurred at the strike-through price but for the catalogue offering a sale price. No doubt many would have occurred at the negotiated price of those sales even if there were no strike-through price in the catalogue, and indeed, even if there had been no catalogue. But, in fixing the penalty, I take into account that some of those sales would not have occurred but for the contravening conduct, although the evidence of other sales prior to the sale period shows that it is very unlikely that any of them would have been at the ticketed (and strike-through) price. That consideration does not materially affect the penalty I impose, because it is the nature of the offences themselves that the defendant's conduct was misleading, and as I have noted, no particular person is shown to have been a victim of any of the offences, or to have suffered loss as a result.
24 The defendant accepts in its written submissions that the offences as found are serious. So it was. In competitive retail markets, not just consumers may have been induced to enter into transactions that they may not have otherwise done. Competitors of the defendant who did not engage in conduct in contravention of the TP Act may have lost custom due to that conduct which they otherwise may have gained. At the least, they were competing for custom against the defendant but the defendant was not competing within the TP Act.
25 I accept, and take into account, that the defendant is contrite. There was considerable debate in submissions as to the extent of the credit that should be given to the defendant in the particular circumstances. In particular, the prosecutor had to resort to the use of its compulsive powers under s 155 of the TP Act to secure certain information from the defendant, and the defendant did not plead guilty to the contraventions and only shortly before the hearing came to agree the facts which ultimately were presented in a Statement of Agreed Facts.
26 Despite those matters, I give the defendant some credit for its conduct in relation to the investigation of the offences and in relation to the conduct of the prosecution. Ultimately, it did agree the facts relevant to the charges. It confined its position to disputing whether, on those facts, representations were in fact made which contravened s 75AZC(1)(g) of the TP Act. Its position enabled the hearing of the charges to be quite focused on a narrow legal issue. It did not challenge the prosecutor's evidence, and cooperated in reaching the Statement of Agreed Facts. At a relatively early stage in the conduct of the prosecution, the defendant indicated that it would adopt that approach, even though it then apparently took some time until shortly before the hearing for the Statement of Agreed Facts to be arrived at. I do not assume that that process was unreasonably prolonged by the defendant.