Application of the principles to the present circumstances
44 The following matters are particularly relevant to the imposition of penalty in the present case: the Origin Group is a substantial group involved principally in the energy industry. Origin Energy is a Top 20 ASX listed company. It or its subsidiaries supply electricity to customers who are mainly in New South Wales, Queensland, South Australia, the Australian Capital Territory and Victoria and supply natural gas to residential customers in those same places. Its size and reputation is such that consumers are likely to have thought that they could rely on the accuracy of its representations.
45 The representations giving rise to the contraventions were directed to residential consumers of electricity and natural gas in South Australia and as such were directed to a diverse cross-section of the public. It can be assumed that these included persons who are gullible as well as the astute, the not so intelligent as well as the intelligent, and the less well informed as well as the informed. In short, the target audience included persons who could readily be misled by the contravening conduct.
46 The prominence of the discounts in each of the forms of representation is likely to have attracted consumers. The Origin Group intended that that should be so because the focus of its campaign commencing on 1 February 2013 was on the discount off energy usage charges which consumers could obtain.
47 The false or misleading representations were made in two separate mediums (the internet and the Confirmation Packs), which would have increased their reach. In the case of Origin Energy, the representations were made on a number of pages on the Origin website over a period of approximately four months (1 February to 29 May 2013). In the case of Origin Electricity and Origin Gas, representations were made in the Confirmation Pack during a five month period (1 February to 30 June 2013).
48 It is not possible to determine with any precision the number of consumers who may have been affected by the false or misleading statements. As at 1 July 2013, the number of Origin customers being supplied electricity under a Market Retail Contract in connection with an energy plan was approximately 7,400 higher than the equivalent number at 1 February 2013. However, it is evident that at least some of these were on a Market Retail Contract in conjunction with an energy plan for which there was no discount. It is also probable that there had been some "churn" of customers in the period between 1 February 2013 and 1 July 2013 with the effect that a direct comparison of the position at 1 July 2013 and 1 February 2013 is not appropriate.
49 The position is similar with respect to those supplied gas. As at 1 July 2013, the number of Origin customers supplied gas under a Market Retail Contract in conjunction with an energy plan was approximately 11,000 higher than the equivalent number at 1 February 2013. Again however, that difference cannot be regarded as indicative of the number of consumers who may have been affected by the false or misleading statements. That is because the number includes consumers who were on Market Retail Contracts but with a no-discount energy plan and, as with those supplied electricity, it is likely that there had been some "churn" of customers.
50 What can be said, is that in each case the number affected, or likely to have been affected, is not insignificant.
51 Consumers who were sufficiently alert or sufficiently interested had a means of ascertaining, reasonably readily, that the rates applicable to the DailySaver Energy Plan were higher than those applicable under the respective Standard Retail Contracts. It should not be assumed therefore that all consumers were misled. Further still, the respondents acknowledge only that some of the consumers would have reasonably understood that the discount would be from rates applicable generally to consumers like themselves. It is improbable that all consumers had that understanding, and so some would not have been misled by the misrepresentations.
52 Contraventions of s 29(1)(g) and (i) of the ACL are serious, as the maximum penalties which may be imposed indicate. The respondents' contraventions may not be in the class of the most egregious which have come before the Courts, but nevertheless their nature, the duration for which they continued and their potential effect on consumers means that they must be regarded seriously. The respondents' departure from the required norms of conduct had, in addition to its effect on consumers, the potential to work unfairness on the competitors of the Origin Group who sought to attract custom by lawful means.
53 It is to the credit of the respondents that they have no history of contraventions. I accept that the respondents had in place, and continue to have in place, systems intended to prevent contraventions of the present kind. The Court was not informed of the nature of these systems, only that each of the statements on the webpages and in the Confirmation Pack had been the subject of a "standard approvals process" which involved review by staff in the marketing, compliance and legal teams of the Origin Group. It is an agreed fact that no senior executives in the Origin Group were involved in the conduct. Although the conduct constituting the contraventions was intentional, there is no suggestion that the respondents' contraventions were deliberate.
54 The Origin Group's conduct in relation to the ACCC investigation and in these proceedings is also mitigatory. The ACCC accepts that the Origin Group provided voluntarily and in a timely manner the information and documents which it sought without it having to resort to s 155 of the CC Act. It also accepts that the respondents made a number of admissions in the proceedings and provided other assistance which narrowed the issues in dispute and foreshortened the length of the anticipated trial. The respondents' acknowledgement of the contraventions is itself a mitigatory factor and an indication of their contrition.
55 Counsel for the respondents also referred to a number other matters: the effect of the declarations of the contraventions on the respondents' reputations; the effect of the other orders proposed by the parties on the respondents; and the economic consequences for the respondents. Subject to one qualification, I agree that these are relevant matters. The qualification relates to the economic consequences. To the extent that those effects are the consequence of the respondents having to compensate consumers who suffered loss by reason of the false or misleading statements, I do not consider that they should be brought into account as a mitigatory factor.
56 It is appropriate to refer particularly to the submission of the parties concerning the totality principle. They submitted that "the Court, in its discretion, should call upon the totality principle rather than imposing penalties for the contraventions of s 29(1)(g) and s 29(1)(i), given that the two contraventions involved in essence the same conduct". The parties referred in this context to Australian Competition and Consumer Commission v Safeway Stores Pty Ltd (1997) 145 ALR 36 at 53:
The totality principle is designed to ensure that overall an appropriate sentence or penalty is appropriate and that the sum of the penalties imposed for several contraventions does not result in the total of the penalties exceeding what it is proper having regard to the totality of the contravening conduct involved.
57 In my opinion, there is little, if any, scope for the application of the totality principle in the present case in relation to the single penalty agreed to be appropriate for the two contraventions by each respondent.
58 In criminal sentencing, the totality principle has a confined function and purpose and cannot be invoked, as a matter of routine, to reduce sentences which are otherwise appropriate. In Mill v The Queen (1988) 166 CLR 59 at 63, the High Court endorsed the following statement of the principle:
The effect of the totality principle is to require a sentencer who has passed a series of sentences, each properly calculated in relation to the offence for which it is imposed and each properly made consecutive in accordance with the principles governing consecutive sentences, to review the aggregate sentence and consider whether the aggregate is "just and appropriate". The principle has been stated many times in various forms: 'when a number of offences are being dealt with and specific punishments in respect of them are being totted up to make a total, it is always necessary for the court to take a last look at the total just to see whether it looks wrong'; 'when ... cases of multiplicity of offences come before the court, the court must not content itself by doing the arithmetic and passing the sentence which the arithmetic produces. It must look at the totality of the criminal behaviour and ask itself what is the appropriate sentence for all the offences'.
As can be seen, this passage contemplates the totality principle having application when a Court has imposed a series of individual sentences for separate offences, and those sentences are to be aggregated.
59 There are different aspects to the totality principle. The first is that when an offender is sentenced for a number of offences, the Court must ensure that "the aggregation of the sentences appropriate for each offence is a just and appropriate measure of the total criminality involved": Postiglione v The Queen [1997] HCA 26; (1997) 189 CLR 295 at 307-8 (McHugh J). The second aspect is that there may be cases in which, while the individual sentences imposed in respect of the separate offences are appropriate, the aggregate of all those sentences will be so "crushing" as to call for some reduction in the aggregate: see King CJ in R v Rossi (1988) 142 LSJS 451, cited by McHugh J in Postiglione at 308. These separate aspects of the totality principle were discussed by Doyle CJ in R v E, AD [2005] SASC 332; (2005) 93 SASR 20 at [36]-[38].
60 In the present case, the parties are not proposing individual sentences for the separate contraventions of s 29(1)(g) and s 29(1)(i). Instead, a single penalty for both contraventions by each respondent is contemplated. It to be expected therefore that the single penalty proposed for each respondent has been assessed as a "just and appropriate measure" of the culpability of each respondent. That has the consequence that there is no further scope for the application of the first aspect of the principle of totality.
61 In relation to the second aspect, it can hardly be supposed that, having regard to the size and resources of the Origin Group, the proposed penalty, or even penalties significantly in excess of those, would be "crushing".
62 Counsel for the respondents submitted that the totality principle could be applied by reference to the aggregate of the penalties imposed on the respondents, having regard to the fact that they are members of the one economic group. He submitted that the fact that there were three respondents instead of one in the present case was simply an incident of the way in which the Origin Group had chosen to organise its affairs and suggested that that circumstance attracted the totality principle.
63 There are circumstances in which, by reason of the close familial or economic relationships between respondents, it may be appropriate to have regard to the overall effect of an aggregation of proposed penalties, especially if they would result in one entity or person being punished twice for the same, or substantially similar, conduct. In Australian Competition and Consumer Commission v Dimmeys Stores Pty Ltd [1999] FCA 1175, Weinberg J noted that the effect of separate fines on the importer and the retailer of unsafe bicycles would be to punish the owner of both companies twice. His Honour said (at [39]):
Ms Strong submitted that I should not differentiate between the penalties imposed upon each defendant. I reject that submission. The evidence establishes clearly that [the importer] is beneficially owned by Mr Zappelli and the members of his family. He and his family also have a substantial interest in [the retailer]. By fining each defendant separately, the Court is, in effect, punishing Mr Zappelli and his interests twice. Their conduct may warrant separate punishment, but some recognition should be accorded to the fact that the two offences are closely related. In my view these factors warrant the imposition of a somewhat lower penalty than would otherwise be merited upon one of the defendants. I accept Mr Wheelahan's submission that the defendant to benefit should be [the importer].
64 However, there is limited scope for the application of a principle of this kind in a context like the present. The imposition of separate penalties on the present respondents does not involve an element of double punishment of any of them. It is in any event evident that the penalties agreed upon by the parties have been structured to reflect the different culpability of each respondent. Further, the respondents must have chosen to organise their affairs in the way that they did, with separate subsidiaries engaged in the retail supply of electricity and natural gas. Presumably they did so because of the advantages which thereby accrued. That being so, it does not seem appropriate to ignore their separate status, simply because it is advantageous, in the present context, to do so.