Australian Competition and Consumer Commission v Wilson Parking 1992 Pty Ltd

ANNEXURE A Attention: [insert customer name] [insert customer address] [insert date], 2009

Dear [insert name], DISCLOSURE NOTICE - Federal Court Ordered Notice The Federal Court of Australia has recently made orders against Wilson Parking Australia 1992 Pty Ltd (Wilson) in relation to legal proceedings instituted by the Australian Competition & Consumer Commission (ACCC). The Court declared that Wilson breached sections 52 and 53(aa) of the Trade Practices Act 1974 (Cth) (Act). The Court found that, during the period October 2007 to June 2008, Wilson, in the provision of mobile security patrol services, made false and misleading representations to some customers by representing to those customers that Wilson had made the contracted number of security inspections (Contracted Calls) to their premises, when in fact, Wilson had not made all those Contracted Calls. The Court also declared that Wilson breached section 52 of the Act, in that, during the period October 2007 to September 2008, Wilson, in the provision of mobile security patrol services, engaged in misleading or deceptive conduct by issuing monthly invoices to some customers for Contracted Calls without: • informing those customers that Wilson had missed some Contracted Calls; and • reducing the amount charged in the invoices to allow for the missed Contracted Calls; or • providing the customers with a refund, credit or rebate in relation to those missed Contracted Calls. Section 52 of the Act prohibits a corporation from engaging in misleading or deceptive conduct. Section 53(aa) of the Act prohibits a corporation from making false representations that services are of a particular standard, quality, value or grade. As part of the orders, the Court has issued injunctions restraining Wilson from engaging in similar conduct in the future, and has ordered that Wilson: • publish this notice; • implement a corporate Trade Practices Compliance Program; and • pay the ACCC's court costs. Since becoming aware that [insert customer name] has been overcharged as a result of missed calls, Wilson has sent [insert customer name] Adjustment Notes crediting you an amount equal to the number of contracted calls that [insert customer name] did not receive during the relevant period. Should you require any further information, please contact Wilson on [insert telephone number]. Yours sincerely, [insert name] [insert position] ANNEXURE B TRADE PRACTICES COMPLIANCE PROGRAM Wilson Parking Australia 1992 Pty Ltd (Wilson) will establish a Trade Practices Compliance Program (Compliance Program) for its security business in Western Australia (Business)that complies with each of the following requirements: 1 Appointments Within 21 days of the Court's Order, Wilson will appoint a Director or a Senior Manager, whose responsibilities are to include the development, implementation and maintenance of the Compliance Program, and who reports directly to the company Board or governing body (Compliance Officer). 2 Risk Assessment 2.1 Wilson will appoint a qualified, internal or external compliance professional with expertise in trade practices issues (Compliance Advisor) within three months of the Court's Order, for the purposes set out in paragraph 2.2. 2.2 Wilson will instruct the Compliance Advisor to conduct a Trade Practices Act 1974 (Cth) (TPA) risk assessment (Risk Assessment) in accordance with 2.2.(a) - (d) below: (a) identify the areas where Wilson is at risk of breaching sections 52 and 53 of the TPA; (b) assess the likelihood of these risks occurring and the consequences of the risks to the business operations of Wilson should they occur;

(c) identify where there may be gaps in Wilson's existing procedures for managing these risks; and

(d) provide recommendations for action having regard to the assessment; In respect of the Business. 3 Compliance Policy 3.1 Wilson will issue to all personnel engaged in the Business a policy statement outlining Wilson's commitment to trade practices compliance (Compliance Policy). Wilson will ensure the Compliance Policy is written in plain language and: (a) contains a statement of commitment to compliance with the TPA; (b) contains a requirement for all staff to report any compliance related issues and trade practices compliance concerns to the Compliance Officer; and (c) contains a clear statement that the Wilson will take action internally against any persons who are knowingly or recklessly concerned in a contravention of the TPA and will not indemnify them. 4 Complaints Handling System 4.1 Wilson will ensure the Compliance Program for the Business includes a complaints handling system capable of identifying, classifying, storing and where necessary, referring internal and external trade practices complaints. 4.2 Wilson will ensure that the Compliance Program includes whistleblower protection mechanisms to protect those coming forward with trade practices complaints. Wilson shall use its best endeavours to ensure that these mechanisms are consistent with Australian Standard 8004, though tailored to Wilson's circumstances. 5 Training 5.1 Wilson will ensure that the Compliance Program includes a requirement for regular (at least once a year) and practical trade practices training for all employees engaged in the Business whose duties could result in them being concerned with conduct that may contravene sections 52 and 53 of the TPA. 5.2 The training program will be designed to ensure the employees' awareness of the responsibilities and obligations in relation to sections 52 and 53 of the TPA. Wilson must ensure that the training is conducted by a suitably qualified compliance professional or legal practitioner with expertise in trade practices law. 5.3 Wilson will ensure that the Compliance Program includes a requirement that awareness of trade practices compliance issues forms part of the induction of all new employees whose duties could result in them being concerned with conduct that may contravene sections 52 and 53 of the TPA. 6 Reports to Senior Management 6.1 Wilson will ensure that the Compliance Officer reports to the Board and/or senior management meetings every six months on the continuing effectiveness of the Compliance Program. 7 Supply Compliance Program documents to ACCC 7.1 Wilson shall, at its own expense, within six months of the date of the Court's Order, cause to be produced and provided to the Australian Competition & Consumer Commission (ACCC) copies of each of the documents constituting the Compliance Program. 7.2 Wilson will implement promptly and with due diligence any recommendations the ACCC may make that are reasonably necessary to ensure that Wilson maintains and continues to implement the Compliance Program in accordance with the Court's Order. 8 Review 8.1 Wilson will, at its own expense, cause annual reviews of the Compliance Program (Reviews) to be carried out in accordance with each of the following requirements: (a) Scope of Reviews - the Reviews should be broad and rigorous enough to provide Wilson and the ACCC with supportable verification that Wilson has in place a program that complies with each of the requirements detailed in paragraphs 1-7 above, and to provide the reports and opinions detailed at point 9 below. (b) Independence of Reviewer - Wilson will ensure that the Reviews are carried out by a suitably qualified, independent compliance professional with expertise in trade practices law (Reviewer). The Reviewer will qualify as independent on the basis that he or she: (i) did not design or implement the Compliance Program; (ii) is not a present or past staff member or director of Wilson; (iii) has not acted and does not act for Wilson in any trade practices related matters; and (iv) has not and does not act for or consult to Wilson or provide other services on trade practices related matters other than Compliance Program reviewing; and has no significant shareholding or other interests in Wilson. (c) Evidence - Wilson will use its best endeavours to ensure that the Reviews are conducted on the basis that the Reviewer has access to all relevant sources of information in Wilson's possession or control, including without limitation: (i) enquiries of any officers, employees, representatives, agents and stakeholders of Wilson; (ii) Wilson's records, including the its complaints register/reports and any documents relevant to Wilson's training or induction program; and (iii) documents created by Wilson's consultants and legal practitioners for use in Wilson's Compliance Program. (d) Wilson will ensure that the first Review is completed within one year and one month of the Court's Order, and that each subsequent Review is completed within one year thereafter for a period of three years. 9 Reporting 9.1 Wilson will use its best endeavours to ensure that the Reviewer sets out the findings of the Review in two separate reports (Review Reports) as outlined below. 9.2 Company Compliance Program Review Report (to be provided to Wilson) (a) Wilson's Company Compliance Program Review Report will provide particular and specific information regarding the performance of the Compliance Program including: (i) if, and to what extent, Wilson's Compliance Program includes all the elements detailed in paragraphs 1 - 6 above; (ii) if, and to what extent, Wilson's Compliance Program adequately covers the parties and areas identified in the initial Risk Assessment; (iii) if, and to what extent, the trade practices training is effective; (iv) if, and to what extent, Wilson's complaints handling system is effective; and (v) recommendations for rectifying deficiencies identified by the Review, which the Reviewer thinks are reasonably necessary to ensure that Wilson maintains and continues to implement the Compliance Program in accordance with these requirements. 9.3 ACCC Compliance Program Review Report (to be provided to the ACCC) (a) The ACCC Compliance Program Review Report will supply particular and specific information regarding the scope of the Review and the effectiveness of the Compliance Program, including: (i) details of the evidence gathered and examined during the Review; (ii) the name and relevant experience of the person appointed as the company Compliance Officer; (iii) the Reviewer's opinion on whether Wilson has in place an effective Compliance Program that complies with the requirements detailed in paragraph 1 - 6 above; (iv) actions recommended by the Reviewer to ensure the continuing effectiveness of the Wilson's Compliance Program; (iv) confirmation that any actual and potential inadequacies in Wilson's Compliance Program have been brought to the attention of the Compliance Officer and the governing body; (v) confirmation that the Reviewer has revisited any actual and potential inadequacies in Wilson's Compliance Program identified in the previous Company Compliance Program Review Report, and assessed how they have been addressed by Wilson; (vi) any reservations that the Reviewer might have about the reliability and completeness of the information to which the Reviewer had access in the conduct and reporting of the Review; and (vii) any comments or qualifications concerning the Review process that the Reviewer, in his or her professional opinion, considers necessary. 9.4 Wilson will ensure that the Review Reports are completed and provided to Wilson within two months of each Review. 9.5 Wilson will retain the Company Compliance Program Review Report. Wilson will cause the ACCC Compliance Program Review Report to be provided to the ACCC within 14 days of receiving it from the Reviewer. 10 Recommendations 10.1 Wilson will implement promptly and with due diligence any recommendations made by the Reviewer or required by the ACCC, which are reasonably necessary to ensure that Wilson maintains and continues to implement the Compliance Program in accordance with the requirements of this Order. 10.2 Wilson shall, at its own expense, if requested by the ACCC, provide copies of documents and information in respect of matters which are the subject of the Compliance Program. 10.3 In the event the ACCC has sufficient reason to suspect that the Compliance Program is not being implemented effectively, Wilson will, at its own expense and if requested by the ACCC, cause an interim or additional Review to be conducted, and will provide the resulting Review Report to the ACCC. 2 What follows are the reasons for the making of those consent orders.

agreed facts 3 The parties together submit that the Court should make the orders sought as set out in a minute of proposed consent orders, having regard to the conduct of the first respondent. In that regard, the parties through their solicitors signed a statement of agreed facts dated 4 December 2009. 4 The Court received this statement of agreed facts at the hearing of the application. As explained further below it appears to the Court that it is appropriate to regard the statement of agreed facts in determining whether or not to make orders in the proceeding by consent of the parties. 5 The statement of agreed facts provides as follows. 6 The applicant is, and was at all material times, a body corporate established by s 6A of the Trade Practices Act 1974 (Cth) (Act). 7 The respondent, Wilson Parking Australia 1992 Pty Ltd (Wilson), is, and was at all material times: 1. a company duly incorporated and carrying on business in Australia; and 2. a corporation within the meaning of the Act. 8 Wilson is in the business of, among other things, providing mobile security patrol services (Patrol Services) to Customers in Western Australia through its security business division in Western Australia. 9 Wilson performs Patrol Services by causing its patrol officers to conduct security inspections of Customers' premises (Calls). Typically, a patrol officer will be assigned a schedule (known as a "run") of premises to attend and inspect during a shift. That schedule typically includes premises owned by more than one Customer. 10 Because Patrol Services are generally performed: (a) at times outside normal business hours; (b) without necessarily leaving any independent record of performance; and (c) in the physical absence of the Customers and their employees; it may be difficult for Customers to determine whether or not patrol officers have performed any particular number of Calls during a period. 11 On various dates, Wilson entered into Contracts (Contracts) for the supply of Patrol Services with each of the entities listed (Customers) in column A of the Schedule attached to the accompanying Minute of Consent Orders (Schedule). But not reproduced in these reasons. 12 It was a term of each Contract that: (a) in supplying the Patrol Services, Wilson would make a stated number of Calls at the Customer's premises in a specified service period (Contracted Calls); and (b) Wilson would use its best endeavours to provide the Contracted Calls, however interruptions or delays (or both) caused by break ins at any other Customers' premises and other emergencies including fire, flood, accident, police or emergency service activities may prevent all of the Contracted Calls being carried out during each service period (Permitted Missed Calls). This clause of each Contract was referred to by Wilson and is generally known in the security patrol industry as a "shared services clause" (Shared Services Clause). 13 The purpose of a Shared Services Clause is to provide for the possibility that a patrol officer may be delayed or prevented from making a call to one Customer's premises during a run because the patrol officer needed to respond to a break-in or other emergency at another Customer's premises. 14 During the period October 2007 to June 2008 (Relevant Period), Wilson had an insufficient number of patrol officers to make all of the Contracted Calls for all of the Customers. 15 During the Relevant Period, for each month specified in each row of column D of the Schedule: (a) Wilson made the number of Calls specified in the corresponding row of column F of the Schedule (Actual Calls) to the premises of the Customers specified in the corresponding row of column B of the Schedule; (b) the Actual Calls fell short of the Contracted Calls by the number specified in the corresponding row of column G of the Schedule (Missed Calls); (c) Wilson Missed Calls that were not Permitted Missed Calls; and (d) Wilson issued monthly Invoices (Invoices) to the Customers on the dates listed in column I of the Schedule for the amount due to be paid by the relevant Customer for the Contracted Calls for the relevant month. 16 The amount of each invoice corresponded with the amount chargeable for the Contracted Calls. 17 By issuing each of the Invoices, Wilson represented to each Customer that it had made the Contracted Calls in the preceding month, save for any Permitted Missed Calls (Call Representations). 18 The Call Representations were false because: (a) the Actual Calls for each Customer fell short of the Contracted Calls by the specified number of Missed Calls in column G of the Schedule; and (b) Wilson Missed Calls that were not Permitted Missed Calls. 19 From October 2007 to June 2008, Wilson knew: (a) that it had an insufficient number of patrol officers to perform the Contracted Calls for all of the Customers; and (b) the matters set out in [15] above. 20 From October 2007 to September 2008, Wilson refrained from: (a) informing any of the Customers of the number of Missed Calls; (b) informing any of the Customers that it Missed Calls that were not Permitted Missed Calls; (c) reducing the amount charged in the Invoices to less than the amount chargeable for the Contracted Calls; and (d) providing the Customers with a refund, credit or rebate in relation to any Missed Calls; when the Customers would reasonably have expected that, if Wilson had Missed Calls that were not Permitted Missed Calls, Wilson would have disclosed that fact to them. 21 In October 2007, Wilson operational management in Western Australia identified to Wilson senior management in Victoria that it had an insufficient number of patrol officers to perform the Contracted Calls for all of the Customers. In early November 2007, Wilson senior management authorised and directed operational management to raise and pay credits to Customers for Missed Calls which were not Permitted Missed Calls. Due to a failure at an operational management level in Western Australia, credits, while provisioned in November, were not actually paid. 22 From July 2008, Wilson was made aware of the ACCC's investigation of the conduct that is the subject of these proceedings, including the failure to pay credits or inform Customers about any failure to perform the Contracted Calls. 23 Credits were then raised and paid by Wilson to Customers, backdated to and including October 2007 for Missed Calls, which were not Permitted Missed Calls, between October 2007 and June 2008. 24 Wilson has raised and paid credits for all Missed Calls to Customers, whether or not they are Permitted Missed Calls, as follows: (a) in September 2008, Wilson processed $84,104 worth of credits for the period October 2007 - January 2008; (b) in September 2009, Wilson processed $146,214.89 worth of credits for the period February 2008 - July 2008; (c) from August 2008, Wilson has issued a manual adjustment note after each monthly invoice, crediting Customers for any Missed Calls during the month covered by that invoice.

contravening conduct 25 In the light of the agreed facts, the parties accept that Wilson contravened the Act in the manner alleged by the ACCC. 26 The ACCC alleges that by making the Call Representations and refraining from informing its Customers of the true position, Wilson engaged in misleading or deceptive conduct in contravention of s 52(1) of the Act. 27 It is understood that the conduct will be misleading if it induces or is capable of inducing error: Parkdale Custom Furniture Pty Ltd v Puxu Pty Ltd (1982) 149 CLR 191. It is not necessary to prove that anyone has in fact been misled. 28 The ACCC further alleges that by making the Call Representations Wilson falsely represented that services were of particular value in contravention of s 53(aa) of the Act. 29 A representation is false if it is contrary to fact. If the representation is not correct then it is false even if it is not false to the knowledge of the person making the representation: see Given v CV Holland (Holdings) Pty Ltd (1977) 29 FLR 212, per Franki J at 217; Darwin Bakery Pty Ltd v Sully (1981) 51 FLR 90. 30 In this regard the ACCC point to the Invoices issued by Wilson at material times that represented to Customers that they had received the security services bargained for. 31 The Court accepts it is open to characterise the conduct of Wilson in the manner agreed by the parties.

orders sought 32 Where a person has contravened s 52 and s 53(aa) of the Act, in a case such as the present, it is open to the Court on the application of a relevant party to grant relief of the following order: · Declarations under s 21 of the Federal Court of Australia Act 1976 (Cth). · Injunctions under s 80 of the Act. · Non-punitive orders under s 86C of the Act including a community service order, a probation order, a disclosure order or a corrective advertising order. · Such order as the Court considers appropriate under s 87 of the Act which might include an order for compensation of persons affected by the conduct, payment or refunds, declaration that a contract is void or unenforceable, or directing a party to provide specified services. 33 In this case, the parties agree that declarations, injunctions and non-punitive orders should be made under s 86. 34 The ACCC advised the Court that it does not seek refunds or compensation orders under s 87 because: · it accepts that refunds have been paid to affected Customers; · the contravening conduct occurred in a business‑to‑business context; and · it regards the contravening conduct in this case as including a substantial element of failure to disclose relevant facts. The ACCC considers that once the conduct ceased and Wilson's Customers were appropriately informed, the public interest will have been effectively served. 35 The ACCC suggests the Court may not make an order under s 83 of the Act, because this matter is proceeding on the basis of admissions rather than a contested trial and refer in this regard to Australian Competition and Consumer Commission v ABB Transmission and Distribution Ltd (No 2) (2002) 190 ALR 169 at 183 -184, per Finkelstein J. Whether or not his Honour's observations referred are intended to stand for such a hard and fast rule does not need to be determined here. The ACCC's enforcement mode in this case need not be questioned on the facts agreed. 36 The Court also observes that the ACCC has not commenced proceedings under Pt VC of the Act and accordingly no pecuniary penalties may be ordered. 37 The parties agree that declarations should be made in terms of proposed orders 1 and 2 of the minute of proposed orders. 38 The Court has a wide discretion under s 21 of the Federal Court of Australia Act 1976 to make declarations of right. The declarations: · are sought by the ACCC in its capacity as the Commonwealth government agency responsible for enforcing the Act; · identify with sufficient precision specific conduct that Wilson engaged in which contravenes the provisions of the Act; · affirms the basis upon which the ACCC seeks injunctions and other orders. 39 The principles stated in Forster v Jododex Australia Pty Ltd (1972) 127 CLR 421 and applied by this Court in cases such as Australian Competition and Consumer Commission v Goldy Motors Pty Ltd [2000] FCA 1885 at [30] support the making of the declarations in that: · The proposed declarations are directed to the determination of a legal controversy not dealing with abstract or hypothetical questions, in that, ¾ the ACCC has alleged and Wilson admits to engaging in conduct in contravention of the Act; ¾ the proposed declarations determine that the conduct alleged contravened the Act in the manner stated; ¾ the ACCC is responsible for enforcing the Act and therefore has a real interest in seeking the proposed declarations; ¾ the relief sought is not hypothetical and the making of the proposed declarations will result in real consequences including vindication of the ACCC's claim that Wilson contravened the Act; will assist the ACCC in performing its statutory duties in relation to consumer's of small business because it may alert, or may be used to alert, relevant individuals and market participants of the kind of conduct that may contravene the Act; Wilson is a proper contradictor because it is a party whose conduct is referred to in the proposed declarations and who has an interest in opposing them; and the making of the proposed declarations is in the public interest. They will serve to mark the Court's disapproval of the particular conduct engaged in, in contravention of the Act. 40 I am satisfied that the declarations should be made. To the extent that it is suggested that the Court should not make declarations in such circumstances, where public rights are an issue, unless there is "evidence" before the Court, I am satisfied that it is appropriate for the Court to make the declarations sought on the basis of the information currently before the Court, including the statement of agreed facts signed by the parties. See generally my observations in Australian Competition and Consumer Commission v Cosic Holdings Pty Ltd [2009] FCA 1579 at [49] - [51]. 41 So far as the injunctions are concerned, the Court has the power under s 80 of the Act to make them. In the nature of public interest injunctions. Consequently the injunctions are statutory in nature and not granted pursuant to the Court's equitable jurisdiction. As s 80(4) and s 80(5) of the Act suggest, the Court has a wider jurisdiction to grant the injunction under s 80 than at general law, although traditional equity principles are not irrelevant. See ICI Australia Operations Pty Ltd v Trade Practices Commission (1992) 38 FCR 248. 42 Injunctions can be made under s 80 if it is in the public interest to do so: Australian Competition and Consumer Commission v 4WD Systems Pty Ltd (2003) 200 ALR 491 at [212] and [216]. 43 The public interest may warrant the making of an injunction notwithstanding the contravener is not likely to repeat that conduct: see Trade Practices Commission v Mobil Oil Australia Ltd (1984) 4 FCR 296 at 300, per Toohey J; Australian Competition and Consumer Commission v Dimmeys Stores Pty Ltd (2001) ATPR 41 - 811 at [32]. In this case an injunction is sought in the public interest to reduce the risk that Wilson will engage in similar conduct in the future that contravenes Pt V of the Act. 44 I accept that the admitted facts disclose a sufficient nexus between the conduct alleged and the orders sought: see Australian Competition and Consumer Commission v Z‑Tek Computer Pty Ltd (1987) 148 ALR 339. 45 I also accept that the proposed injunction is sufficiently clearly and precisely stated to be capable of being complied with and would not require Court supervision: see Australian Competition and Consumer Commission v Real Estate Institute of Western Australia Inc (1999) 161 ALR 79 at [26]. 46 The particular injunction sought to some extent requires Wilson to comply with the law, however it also has regard to the actual practices of the respondent and the circumstances in which it deals with Missed Calls. It provides for refunds to Customers in certain circumstances. It is apparent therefore that the injunction if granted does more than admonish the respondent to comply with the law. 47 In the circumstances I consider the injunction to be appropriate. 48 The parties also request the Court to make orders pursuant to s 86C that would cause Wilson to send a letter to Customers advising them of the Court's judgment, findings and the remedies granted and also requiring Wilson to establish and maintain a compliance policy for three years. The letter to Customers will achieve the result of advising them of the nature and extent of Wilson's conduct in contravention of the Act and the outcome of the proceeding. It will protect consumers by alerting them to the fact that the conduct occurred, increase their awareness of the type of conduct that may breach the Act and encourage Customers to ensure that they receive the services to which they have contracted, and it is appropriate for such orders to be made. 49 The compliance policy is intended to prevent further incidence of the conduct in future by ensuring that Wilson has procedures in place to educate its employees about the type of conduct that may breach the Act. 50 These compliance orders are consistent with the purpose of s 86C which is raising awareness of the type of conduct that may contravene the Act and as to the outcome of particular litigation: as to which see Australian Competition and Consumer Commission v On Clinic Australia Pty Ltd (1996) ATPR 41 - 517.

conclusion and orders 51 For these reasons I am satisfied that the orders proposed by the parties in the minute of proposed consent orders should be made. I certify that the preceding forty-nine (49) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Barker.

Associate: Dated: 22 December 2009 Counsel for the Applicant: Mr W Keane

Solicitor for the Applicant: Corrs Chambers Westgarth