Other sentencing principles
86 Each instance in which Mr Chopra made a Representation in breach of s 29(1)(m) or failed to supply a good following acceptance of payment in breach of s 36(4) constitutes a separate act in contravention of those provisions.
87 It is appropriate to treat the acts of Mr Chopra that gave rise to the contraventions of s 29(1)(m) as one course of conduct comprising the making of the Representations, because these contraventions arose from the same or similar facts. This is a relevant consideration in considering the total pecuniary penalty.
88 However, it is appropriate to treat the four instances of failure to supply a good within a specified or reasonable time following acceptance of payment in breach of s 36(4) as four separate contraventions, rather than a single course of conduct, because those contraventions occurred as discrete incidents and relate to four different consumers.
89 In light of the recent decision of the Full Court in CFMEU, the ACCC has provided submissions detailing pecuniary penalties imposed in previous potentially analogous decisions. This included details of pecuniary penalties imposed:
(a) in other cases for contraventions of s 29(1)(m);
(b) under the ACL in cases involving sole traders or small proprietary companies (but where no contravention of s 29(1)(m) was alleged); and
(c) for contraventions of three other provisions that have some similarities to s 36(4) (because no pecuniary penalty has previously been imposed for a contravention of s 36(4) of the ACL), namely s 58(b) of the TPA, s 75AZL(3) of the TPA and s 19 of the Fair Trading Act 1999 (Vic).
90 Those submissions were useful, in that they provided details of the relevant statutory provisions, the maximum penalties, the nature of the conduct of the contravener, and the relevant factors taken into account by the court.
91 Counsel for the ACCC referred to (amongst other decisions) Australian Competition and Consumer Commission v Artorios Ink Co Pty Ltd (No 2) [2013] FCA 1292 ('Artorios'), in which the contraveners had engaged in deceptive conduct in attempts to establish contractual relationships with small business customers, including by representing that they had placed orders for certain products, when that was not the case.
92 In that case, Mortimer J (at [21]) inferred:
a deliberate and calculated plan constructed to misrepresent to small businesses (through calls to unsuspecting employees or shop managers) some kind of existing supply relationship, then to take advantage of the misrepresentation to supply goods and then demand payment….
93 However, Mortimer J noted (at [93]) that:
[t]he proven loss and damage is at such a modest level that I do not consider it should attract a heavier penalty than might otherwise be imposed if no loss or damage were proven on similar facts.
94 Like the respondents in Artorios, Mr Chopra was operating a relatively small but fully-functioning small business, which was large enough to employ staff (see [94]) and his "conduct was spread across Australia, and continued over a substantial period of time": see [96].
95 In considering the appropriate penalty in Artorios, her Honour (at [100-1]) noted the important need for deterrence, especially in light of the deliberate nature of the conduct, as has occurred in this proceeding.
The penalties imposed in this proceeding should be sufficiently high to deter the second and third respondents from harbouring any ideas it is worth repeating this kind of conduct. The penalties should also be high enough to demonstrate a real financial impact on any other suppliers of goods who might consider engaging in such a scheme.
These factors, especially the calculated and deliberate nature of the conduct, the planning and preparation for it disclosed by the evidence, and the targeting of low-level employees and small businesses with a common and necessary product, could have led me to conclude that penalties higher than those proposed in the joint submissions should be imposed….
96 However, her Honour considered that a lower penalty was appropriate after taking into account the following mitigating factors (at [102-5]):
[102] I take into account the cooperation of the respondents, their ultimate agreement to the facts necessary to found liability and the consequent saving of the public resources of both the regulator and the Court. These matters have led me to consider a lower figure than otherwise might have been the case.
[103] The second and third respondents have lost the business they established. They have also undertaken not to be directors of, or be involved in the management of, any corporation for five years. These two matters produce significant and adverse changes to their personal circumstances and I take those into account in determining the appropriateness of the sum of $50,000 as a penalty for each of them.
…
[105] Both the second and third respondents attended the penalty hearing before the Court. I am prepared to infer that their experiences in being subjected to these proceedings, and to public admissions and findings of wrongdoing, and their naming in proceedings such as this, has been difficult and somewhat shameful for them. Those effects should also be taken into account in the determination of penalty.
(Emphasis added)
97 Justice Mortimer further held (at [106]) that absence of prior contraventions also justified a lower penalty:
Neither of the respondents has been found previously to have engaged in similar conduct under Ch 4 or Pt 5.2 of the ACL. This fact weighs in favour of a significant but not heavy penalty. I consider the sum of $50,000 to fit that description, given the maximum penalty is $220,000.
(Emphasis added)
98 As noted above, the maximum penalty in respect of a contravention of a provision of Pt 3-1 of the ACL by a natural person is $220,000.
99 The ACCC submitted that some of the mitigating factors in Artorios may not be present in this proceeding. In relation to cooperation, Counsel for the ACCC referred to unsuccessful attempts between the parties, pursuant to court orders, to attempt to agree a set of facts for the purposes of today's hearing. However, Counsel accepted that Mr Chopra's admission to the allegations, and the subsequent need for this Court to limit its consideration to penalty, warrants some discount.
100 Further, in my view, the mitigating factors considered by Mortimer J in paragraphs [103] and [105-6] are applicable here, save for the fact that Mr Chopra did not provide an undertaking. As I mentioned, I accept that Mr Chopra's business is no longer viable and that he is in the process of closing it down. Finally, I am prepared to make a similar inference to that of Mortimer J, that Mr Chopra's experience in this proceeding has been difficult and shameful for him.
101 I make detailed mention of the decision and approach of Mortimer J, and the differences and similarities to this proceeding, to demonstrate that with appropriate discernment as to detail, previous decisions can be of some guidance.
102 However, one point is important to stress. Previous decisions (no matter how analogous) do not limit the range of penalty which may be appropriate, nor do they restrict the approach to be taken by the court in imposing the appropriate penalty in any particular later decision. As Barker J said in Comcare v Tanspacific Industries Pty Ltd [2015] FCA 500 at [268-9]:
In taking all relevant factors into account, the Court may also have regard to what penalties have been provided in apparently like cases. This is emphasised in the recent Full Court decision of [CFMEU]. I, with respect, agree with the comments made by the Full Court to that effect, given that consistency in the imposition of penalties under the OHS Act is also a desired outcome of the operation of the legislative regime.
At the same time it is understood that there is no 'tariff' to be applied for particular types of contraventions. If that were so then the Court would be failing properly to conduct the intuitive synthesis exercise required of it. It would be a slave to precedent rather than to principle in assessing the appropriate penalty.