Australian Competition & Consumer Commission v McCaskey

Federal Court of Australia|2000-08-01|Before: French J

Introduction 1 When Shylock in the Merchant of Venice demanded a pound of his debtor's flesh he was confounded by the very law which he invoked. The community attitude reflected in Shakespeare's play is deep seated and persistent. In today's credit-based economy the collection of payments for goods and services is an indispensable element of trade and commerce but the use of physical force, undue harassment or coercion in connection with the collection of debts is regarded as unacceptable. It is prohibited by the Trade Practices Act of the Commonwealth and the Fair Trading Acts of the various States. In this case a debt collector and its employee have admitted to engaging in undue harassment and coercion as well as misleading or deceptive conduct in connection with the collection of debts. The debt collector, Cash Return Mercantile Pty Ltd ("Cash Return") and its employee Sharyn McCaskeyhave been sued by the Australian Competition and Consumer Commission ("ACCC") and have consented to the making of various orders by way of declaration and injunction against them. It is necessary now for the Court to consider whether the proposed orders are within power and appropriate.

Factual Background 2 Cash Return is a company which, until recently, carried on the business of supplying debt collection services involving the collection of payment for goods or services from consumers on behalf of its clients. Sharyn McCaskey was an employee of Cash Return engaged to recover debts from consumers on behalf of Cash Return's clients. Incidents involving attempts by Ms McCaskey to collect payment on behalf of Cash Return from four debtors have led to the present proceedings. The facts of those incidents are reflected in statements from persons who were to be called as witnesses in the trial of this application. Those statements have each now been agreed by both Ms McCaskey and Cash Return to be true and correct. The following factual history is based upon them. 3 The first incident arose out of the supply by Reward Consultancy Pty Ltd, trading as NetNology, of video conferencing services to TouchGold Pty Ltd. The account was unpaid because TouchGold disputed that the services provided were in accordance with the terms agreed. The rights and wrongs of the dispute are not material here. 4 The conduct the subject of the present application so far as it relates to the TouchGold debt involved three telephone calls to Ms Byart by Ms McCaskey. In the first call on 30 January 1998, Ms McCaskey introduced herself, said she was ringing about the outstanding account with NetNology and said that she was "…sending someone around now to collect the cheque". Ms Byart was not willing to pay until she had received a breakdown of the account. Ms McCaskey suggested an interim payment of $4,000 as a goodwill gesture for the time being and said she would send someone around to collect it. Ms Byart maintained that she wanted a breakdown of the charges. Ms McCaskey said she would check about the breakdown but again asked for a cheque for $4,000 to be ready by the following Monday. Ms Byart didn't agree to that and said she wanted a breakdown of the charges. Ms McCaskey said: "Look, I'm warning you…I want the money paid or a summons will be issued against you." Her manner was described by Ms Byart as "very abrupt, authoritative, forceful and demanding". 5 On the following Monday, 2 February 1998, Ms McCaskey again telephoned Ms Byart. She opened the conversation by saying words to the following effect: "Sharyn McCaskey here. Stop messing around here. You should pay this bill. I have someone here and they are going to walk out this door to collect your cheque. If you don't agree to have the cheque ready, then they'll go and issue a summons and this is going to destroy your credit rating and disgrace you and…" Ms Byart asked whether this was a threat and Ms McCaskey said that she was threatening Ms Byart but it was justifiable because she should be paying the bill. Ms Byart made reference to a heart condition from which she suffered and that the stress was causing her to have breathing difficulties at that time. Ms McCaskey said that if Ms Byart had a heart condition she shouldn't be in business. Ms Byart reiterated that she would not pay anything until she had a breakdown of the costs. Ms McCaskey claimed to have faxed the information to her on the Friday of their last conversation. Ms Byart checked her fax machine and fax journal entries but there was no record of any such document. When she told Ms McCaskey this, Ms McCaskey said: "Well, I sent it. You must be lying. You are just trying to get out of paying this debt…Anyway, you said on Friday that you were going to pay $4,000 today." Ms Byart denied that she had agreed to pay $4,000. Ms McCaskey asserted she had said it and that she had recorded the conversation and that she was recording their current conversation. When Ms Byart questioned the legality of this action, Ms McCaskey said: "Well it is legal I've had discussions with the police and I have got permission from them to do it. Anyway, I have already sent the breakdown and now you are just refusing to pay." Ms Byart offered to send a courier to collect the breakdown information from Ms McCaskey. Ms McCaskey said: "No, I don't want you to do that. I know I sent it to you. I've sent it to you three fucking times now. I'm not going to keep sending it." Ms Byart said she was not prepared to discuss the matter any further and asked where she could send the courier to pick up the information. Ms McCaskey gave her an address in Fremantle. Ms Byart asked her to stop shouting. Ms McCaskey said Ms Byart was the one who was shouting and said "…we have it all on tape, remember". Ms Byart asked for a copy of the tape and Ms McCaskey responded: "You have got to be joking. This tape recording is going to be used against you. We may not be able to use it in court, but we can use it against you - don't you worry, I'll get what I want from you." 6 Ms Byart has suffered stress related coronary artery spasms which cause breathing difficulties and increases in her blood pressure. She carries a nitroglycerine sub-lingual spray to treat the symptoms when they occur. After her second conversation with Ms McCaskey she used the spray and saw her general practitioner who took her blood pressure and calmed her down but did not prescribe any additional medication. On her return to the office Ms Byart arranged for a courier to collect the breakdown information from Ms McCaskey at the address given in Fremantle. The document they returned with was simply a copy of the invoice she had originally received from NetNology and not the breakdown of costs requested. Subsequently Ms Byart telephoned the Ministry of Fair Trading and was referred to the Commercial Agents Squad. She advised NetNology that she had lodged a complaint about the conduct of Ms McCaskey. She sent letters to both the Ministry of Fair Trading and the Commercial Agents Squad on 14 February 1998 outlining her concerns. Ms McCaskey called her again a few days later and said: "Yes, we know you have made a complaint and spoken to people, but that will not do you any good." She referred to the Sergeant of Police with whom Ms Byart had spoken at the Commercial Agents Squad and then said: "He will not do you any good because he is in trouble. And, he will be in a mess with his supervisors over this. I have connections at a higher level than him he is a nobody and I am friendly with his superiors. Because he has told you this stuff, I'm going to make sure that he is taken care of. And the police said it was OK for me to tape telephone conversations." Ms Byart said she did not have to talk to Ms McCaskey, she had reported her conduct because it was completely unacceptable. She said she still did not have the breakdown details so if they wanted to sue her they could do it. She then hung up. A summons was issued by NetNology seeking payment of the outstanding invoice and Ms Byart engaged Minter Ellison, Solicitors to act on behalf of TouchGold. The dispute over the account remains unsettled and the summons has not been pursued by NetNology. 7 The second incident which is the subject of this application concerns the recovery of a bill for legal services provided to Margaret Piercy. In mid-1997 Ms Piercy engaged the services of Ann-Marie Adam, a legal practitioner to represent her in proceedings in the Family Court. Ms Adam acted on her behalf in those legal proceedings and on 9 October 1998 sent her an invoice in the amount of $5,220.98. The matter was settled and on 15 October 1998 Ms Piercy's husband paid an agreed settlement amount of $120,000 into her bank account. On the same day she purchased a property at Yangebup for $117,000 using the proceeds of the settlement and moved in shortly afterwards. On 29 October 1998 Ms Piercy received a letter from Ms Adam requesting payment of the outstanding amount which was then $5,284.98 by 31 October 1998. 8 On 6 November 1998, two weeks after she had moved into her new home, Ms Piercy was visited by a man who introduced himself as a private investigator and asked whether she was going to pay the debt owed to Ms Adam. Ms Piercy said she was. He then gave her a card with Ms McCaskey's name on it. Ms Piercy rang Ms McCaskey who asked how much she could pay that day. Ms Piercy told Ms McCaskey that she had just bought the house with the money from the court settlement but could pay $800 on that day. She was given an account number at the Spearwood branch of the Commonwealth Bank and later that day went to that branch and deposited $800 into the account which Ms McCaskey had designated. 9 Subsequently Ms Piercy applied for a loan to the Challenge Bank to pay the account but was told that the bank would not be willing to provide her with a loan. On the day that she was at the bank her son, Bradley, was at home and answered a telephone call from Ms McCaskey. Ms McCaskey asked where his mother was. He told her that she had gone to get a loan. Ms McCaskey said "We don't want her money, we are selling the house". The boy responded "like fuck". Ms McCaskey said "You stupid little fucking idiot, what's your name, do you know who you're messing with? You had better apologise." The boy said "Sorry" and then hung up. On the following Friday, Ms McCaskey again telephoned Ms Piercy and said she wanted the rest of the money. Ms McCaskey told Ms Piercy that she was not going to have "…a fucking smart ass little kid telling me what to do". Ms Piercy said she could not get a loan overnight. Ms McCaskey said: "I'll come around and take your house and sell it if you don't pay the money. I mean business, honey." 10 Ms Piercy then approached Barry Elmslie of Finance Broking Services who arranged to meet her the following afternoon so that she could make an application for a loan. She telephoned Ms McCaskey back to explain how she was dealing with the matter, that Mr Elmslie was coming around to her home the following day to sort it all out. Ms McCaskey noted that this would simply involve making an application. She said "That is not good enough and we want our money now. If it is not paid by 5pm tonight we are going to sell your house, honey. We don't play games". Ms Piercy responded that she was trying to get the money together and Ms McCaskey then said: "Listen here, love. We are not joking with you, we are not mucking around. I mean business. Ring me at my office as soon as you find out about the finance." She hung up on Ms Piercy. Ms McCaskey then rang back and said "…and I mean my Rockingham office, not Fremantle" following which she hung up again. 11 On 17 November Mr Elmslie came to Ms Piercy's home, they completed the application for a loan and he told her he would phone Ms Adam to let her know that in his opinion finance was likely to be approved. He telephoned Ms Adam's office in Ms Piercy's presence and advised a person at the office that finance was likely to be approved. After Mr Elmslie had had his conversation with somebody at Ms Adam's office, Ms McCaskey rang and spoke to Ms Piercy again asking when she was going to pay the debt. Ms Piercy pointed out she had a financial broker with her at the time. Ms McCaskey responded "Really? Well, I want written authorisation saying the money is going to be available. I want the money - I'm not mucking around here love." Ms Piercy said she was trying to get the finance as quickly as possible and Mrs McCaskey said: "I don't care what you do and I don't care if you are on a pension. We just want our money. It is no use getting other people to help and phone us up and beg for pity because you are on a pension. If I don't get the money soon I'm going to commence legal proceedings and I'm going to take your house. My husband I have just bought a house and I know how long it takes to settle so you can't fool me, honey. I mean business." Ms Piercy pointed out that nobody had said anything about her being on a pension. Ms McCaskey responded that Mr Elmslie had and that she was in Ms Adam's office at the time. Mr Elmslie then took the phone and explained to Ms McCaskey that he was helping Ms Piercy to obtain finance. He was, however, interrupted during the course of the conversation. He then hung up the telephone. The telephone rang again, Mr Elmslie told Ms Piercy to pick it up and immediately hang up, which she did. It rang five or six times and each time Ms Piercy picked it up and then hung up. 12 On 23 November 1998, Mr Elmslie telephoned Ms Piercy at home and advised her that he had just received advice of loan approval from the ANZ Bank for the amount of $20,000. 13 On 30 November 1998, Ms Piercy was at home with a friend, Sue, when the phone rang. Sue answered the phone and then said "I am not Margaret, I am a friend of hers." She then passed the phone over to Ms Piercy. It was Sharyn McCaskey. She said: "Seeing you are getting the finance arranged I want you to come in and sign a declaration that the money will be paid no later than 4 December." Ms Piercy was not prepared to do that and said that Mr Elmslie had advised her not to sign anything. However as a result of Ms McCaskey's request later that day she went to the Bibra Lake Post Office and sent a fax to Ms Adam's office stating that once her loan was paid into the bank account, which should be no later than 4 December 1998, she would pay Ms Adam immediately by bank cheque for the full amount of the debt. About that time she received a further telephone call from Ms McCaskey who said that she was going to the bailiff's office and getting a letter of execution. She told Ms Piercy that she should not pretend to not be at home because the bailiff would simply nail the notice to her front door. Ms Piercy found Ms McCaskey's manner during all of the telephone conversations to be intimidating, aggressive and overbearing. She felt frightened and stressed and as a result did not answer her phone at all during the day. The necessary paperwork was completed by 4 December and on that day her bank account was credited with $20,000. She went to Ms Adam's office the same day to pay the account in full. She was referred to the Cash Return office. She went there and paid the debt. 14 The third incident to which this application relates concerned Jason Robert Standing. On 22 July 1998 a veterinarian from Searle Mobile Veterinary Service came to his home, by prior arrangement, to vaccinate his dog and her puppies. He was at work at the time. When he returned home his wife told him that the vaccinations had been given and that she had given the vet a cheque of $130. Mr Standing was not happy with this as the representative he had spoken to from the veterinary service the previous day had quoted a lower price over the phone. He phoned the veterinary service office and spoke to a woman who said he would not have been given a lower quote over the phone. Mr Standing then arranged for the cheque to be stopped. 15 On or about 11 March 1999 he received a letter from Cash Return signed by Ms McCaskey. The letter stated that as he had not settled his debt despite their constant requests, a summons had been drawn and would be issued unless he paid the amount of $162.50 within forty eight hours. The $162.50 was said to be made up of the original invoice amount of $130 plus "other charges" of $32.50. 16 Later that day, Mr Standing telephoned the offices of Cash Return. He spoke with someone called Kylie and said he was phoning her because he had just received a letter from Ms McCaskey. He told Kylie he was disputing the account. He said that the letter claimed there had been "constant requests" but he had not had any previous correspondence. Kylie said: "That is not true. You would have received notification by now. You are a liar. Do you think you can just rip people off and not pay?" Standing asked to speak to her superior, to which Kylie said, "…she is worse than I am anyway". She told him to "cop it sweet and pay up". Mr Standing hung up. Ten minutes later the telephone rang and it was Ms McCaskey. She asked his name and then asked him whether he would like to be arrested by the Fraud Squad. She said, "I'm Sharyn McCaskey from Lee's Legal, working for Cash Return. You have committed an offence. It is an offence to stop a cheque. I will make an example of you. You can just ask around town because I am well known as a person who makes examples of low-lives like you. I'm going to get the police to come around…". Mr Standing told her he had not received any letters or anything. She told him he was lying. She referred to another alleged debt owed to Bi-low which would also require immediate payment. He asked where the paperwork was for that. She said: "Oh, you would have received that by now. Look, do you want to be arrested by the police? I will make an example of you." He asked why she would want to make an example out of him. She said because she wanted to and because she could. She said to him: "…now the only acceptable method of payment is by depositing the entire amount of both debts into a Cash Return Trust Account by the close of business tomorrow." She told him to get a pen ready. She asked someone in the office for a bank account number and then she said: "One of the girls here used to go to primary school with you, and she reckons you are a good kisser. It is a pity you turned into such a loser, hey? Oh, can you hear us all laughing, we're having a good laugh at you." She then gave him the number of a Cash Return Trust Account with the Commonwealth Bank. She told him his cheques were no good and that it must be cash and asked if he would pay in cash by the end of the day. She said that he had better pay or they would have the police there. Later Mr Standing's wife, Michelle, returned home from the shopping and he told her about the details of his telephone conversation with Ms McCaskey. His wife then said that in order to avoid further hassles she had telephoned the offices of the veterinary service on 22 July and that shortly after that a representative from the service had come to their house and collected $130 in cash from her. She showed him the veterinary service invoice which bore the handwritten word "Paid". 17 On 12 March 1999, Mr Standing telephoned the Fraud Squad, Credit Legal Services and Credit Care to seek advice about his rights and to complain about Ms McCaskey's behaviour. Shortly after making those calls he telephoned the offices of Cash Return and had a further telephone conversation with Ms McCaskey. He told her he had a receipt for the bill and that his wife had paid it in cash on 22 July 1998. She said: "Well, I was just on the phone to the vet and that is bullshit. You are lying. You must pay." He told her this was stupid, that he would post her a copy of the receipt and that he was considering making a complaint against her. She said there was nothing he could do and that she had good news. She told him he wouldn't be getting a summons because she had passed it on to the Fraud Squad already. Subsequently Mr Standing telephoned the Perth Office of the ACCC to further complain about Ms McCaskey. He sent Cash Return a copy of the receipt and a copy of its letter of 10 March 1999 to show that the debt had been paid in full. On Monday, 15 March 1999, he received a further telephone call from a woman who identified herself as Kylie. She told him that she had just received his paperwork that day and that he owed $264. He told her she could send him the paperwork for another bill and as far as that went he didn't want to talk any more. The telephone rang again shortly after and this time it was Ms McCaskey on the phone. The substance of that conversation was to the effect that because his wife's name was on the invoice, they would take a summons out against her as well. That would be in addition to his summons for the other bill. He hung up. 18 The fourth incident which has given rise to this application, concerned Norma Joan Campbell and her husband, Kevin, who are directors of Meishiwang Australia Pty Ltd trading as San Remo Store. The company acquired the store on 1 January 1999. Prior to that date Mrs Campbell's daughter, Esther Cook and her husband Chris Cook had run the store. At that time Chris Cook had also carried on a business called Abstract Signs. It appears that late in December 1998, he had made an agreement, through Abstract Signs, with a Mrs Oliver, of Superfine Print, to purchase a quantity of business cards for about $120. 19 About 12 March 1999 in the afternoon, Mrs Campbell received a telephone call from Ms McCaskey who asked to speak to her husband. He was not there at the time. Ms McCaskey asked if she was speaking to Mrs Campbell. She said she was. Ms McCaskey said she had Mrs Oliver on the phone and said: "Mrs Oliver, this is Norma on the other line, this is Kevin's Norma. Kevin is not in. Now according to Superfine Print you owe $120 to them and we want to know why that hasn't been paid." Mrs Campbell replied that it was not her debt. She said that Kevin was not present, nor was the person who owed the money. She would have to call back. Ms McCaskey asked Mrs Oliver if was true that Kevin Campbell had said he had paid the bill. Mrs Oliver said it was. Ms McCaskey then said that made Mrs Campbell responsible for it. She replied that she was not Kevin, she had never said that and she was not responsible for the debt. Ms McCaskey then said: "I have a summons here that I am going to start writing out right this minute, so I can get the money off you straight away. And, I'll make that summons against your shop." Mrs Campbell told her to go ahead and do it. She also told Mrs Oliver she was wasting money because it was not her debt. It would cost her money to issue the summons and then issue another summons to the right person. Ms McCaskey replied: "No. The debt is yours and you are being summonsed for it." Mrs Campbell then hung up. A few seconds later Ms McCaskey called back and said: "Listen here you, don't you hang up on me." Mrs Campbell asked for Ms McCaskey's phone number, which she was given and asked her the name of the company which she claimed to own. Ms McCaskey said: "That is for you to find out sweetie. And don't think you can just hang up on me. You owe this debt…." Mrs Campbell then hung up. The telephone rang again a few seconds later and Ms McCaskey again said: "Don't you hang up on me. You know what I'm going to do? I'm going to come into your shop and I'm going to wait until there are a lot of people in your shop and then I'm going to embarrass you to the hilt and then hand you the summons." Mrs Campbell told Ms McCaskey not to threaten her like that and hung up. She found Ms McCaskey's manner extremely intimidating and aggressive. It made her feel unnerved and upset. She rang her husband who came straight back to the shop. They decided to lodge a formal complaint against Ms McCaskey. They telephoned the Ministry of Fair Trading and were referred to the ACCC. The ACCC suggested they also contact the Commercial Agents Squad. The officer at the Squad that she spoke to advised her to tell Ms McCaskey that she did not want Ms McCaskey to contact her or her husband again regarding the debt. She telephoned Ms McCaskey and started to tell her that she did not want any further contact from her. McCaskey hung up. She tried again and Ms McCaskey hung up once more. Mr Campbell telephoned Mrs Oliver and told her not to contact the Campbells by telephone or speak to either of them regarding the debt. About half an hour later the phone rang and the caller, whose voice Mrs Campbell recognised as Sharyn McCaskey, said: "This is Melissa from Lee's Legal." Mrs Campbell asked again for her name. The response was: "Melissa from Lee's Legal. We are ringing about the threat you have made to the Squad. What is the name of your shop?" Mrs Campbell asked again for the name of the caller and the name of the company. Ms McCaskey then said: "Listen here you. Don't you think you can stop me. No-one can stop me. They have been trying to stop me for years. They have been trying to get my licence off me for years and they've never been able to because I know the right people. I have barbecue lunches with these people from the Squad every Sunday. They are on my side. So don't think you can touch me. I'm still going to come down to your shop." Mrs Campbell then hung up and told her husband what the caller had said.

The Present Proceedings 20 On 13 October 1999, the ACCC filed an application against Ms McCaskey and Cash Return seeking declaratory and injunctive relief as well as other orders based on alleged contraventions of ss 52, 53(g) and 60 of the Trade Practices Act 1974 (Cth). At a directions hearing held on 27 October 1999, directions were given for the filing of defences, the giving of discovery, inspection of documents and listing for further directions. Defences were filed on 18 November by Cash Return and on 21 December by Ms McCaskey. Discovery was given by the ACCC and Ms McCaskey and on 20 January 2000 directions were given for the filing of statements of witnesses and the listing of the application for trial at a date to be fixed by the Registrar. Listing and mediation conferences were held before Deputy Registrar Rayney on 27 March 2000, 1 May and 8 May. The defences were withdrawn by a notice filed on 17 May 2000 by Ms McCaskey and by Cash Return. The parties came before me on 30 May with proposed consent orders. Directions were made for the ACCC to file and serve a joint submission if one could be agreed, including any agreement as to facts and, otherwise, its own submissions as to the power of the Court to make the consent orders proposed. The matter was relisted to 17 July. Subsequently a joint submission and agreement as to facts together with revised consent orders were filed on 11 July 2000. The agreement as to facts was in the form of an agreed statement of facts. It contained one sentence namely that: "The parties agree that the attached statements of: . Margaret June Piercy . Barry Stuart Elmslie . Bradley Albert Stott . Norma Joan Campbell . Kevin Arthur Campbell . Linda Byart . Jason Robert Standing are true and correct." Having heard argument in support of the joint submission on 17 July I reserved judgment on the proposed consent orders to 1 August. It emerged only in the course of argument that Cash Return had sold its debt collection business and no longer intends to trade in the collection of debts. It appears however that the purchaser proposes to operate the business under the name of Cash Return. 21 On the evening before judgment was to be delivered a further revised consent order was submitted to take account of some comments made during the course of argument on 17 July. The changes were comparatively minor and will be dealt with in the course of these reasons.

The Proposed Consent Orders 22 The consent order against Ms McCaskey proposes first a declaration that by reason of various matters, she has, by conduct involving the use of telephonic services, used undue harassment and coercion in connection with the payment for goods or services by a consumer contrary to s 60 of the Trade Practices Act. The matters set out in pars (a) to (e) of the declaration refer to her telephone contacts with Linda Byart, Barry Elmslie, Jason Standing and Norma Campbell and characterised them variously as involving a threatening, aggressive, excessive or abusive manner. Paragraphs (b) and (e) also assert the undue frequency of her telephone contacts with Ms Piercy and her son and with Norma Campbell and the threatening, aggressive and overbearing manner and content of those telephone contacts. 23 A further declaration is sought that by reason of various matters Ms McCaskey, by conduct involving the use of telephonic services, in trade or commerce, engaged in conduct that was misleading and deceptive contrary to s 52 of the Trade Practices Act. Another proposed declaration based on the same matters asserts that by conduct involving the use of telephonic services in trade or commerce in connection with the supply of debt collection services to the clients of Cash Return, Ms McCaskey made false and misleading representations concerning the existence and effect of a right or remedy, contrary to s 53(g) of the Act. 24 Injunctive relief was also sought against Ms McCaskey in the following terms: "3. An injunction for 3 years restraining the First Respondent from using undue harassment or coercion in connection with the payment for goods or services by a consumer by: (a) Representing that action will be taken that the first respondent has no reasonable basis for believing that she is legally permitted to take, or does not have instructions or authority to take, at the time the representation is made; (b) Threatening criminal action if a debt is not paid or engaging in conduct that is likely to lead a debtor to believe that criminal action could be a consequence of non-payment, if at the time the First Respondent has no reasonable basis for believing that the non-payment would result in criminal charges; (c) Leading a debtor to believe that the collectors decision to report an alleged criminal offence will depend on whether or not a payment is made; (d) Using abusive, offensive or obscene language to a debtor or a third party; and (e) Making more than 3 telephone calls per calender week which are personally answered by the debtor, unless the debtor otherwise agrees to further telephone calls. 4. An injunction for 3 years restraining the First Respondent, in connection with the supply of debt collection services, from making false or misleading representations to any person concerning the existence or effect of any right or remedy by: (a) Representing that action will be taken that the first respondent has no reasonable basis for believing that she is legally permitted to take, or does not have instructions or authority to take, at the time the representation is made; (b) Threatening criminal action if a debt is not paid or engaging in conduct that is likely to lead a debtor to believe that criminal action could be a consequence of non-payment, if at the time the First Respondent has no reasonable basis for believing that the non-payment would result in criminal charges; and (c) Leading a debtor to believe that the collectors decision to report an alleged criminal offence will depend on whether or not a payment is made. 5. An injunction for 3 years restraining the First Respondent from engaging in conduct, in trade or commerce, that is misleading or deceptive, or is likely to mislead or deceive a person in connection with the collection of payment of debts from any person by: (a) Representing that action will be taken that the first respondent has no reasonable basis for believing that she is legally permitted to take, or does not have instructions or authority to take, at the time the representation is made; (b) Threatening criminal action if a debt is not paid or engaging in conduct that is likely to lead a debtor to believe that criminal action could be a consequence of non-payment, if at the time the First Respondent has no reasonable basis for believing that the non-payment would result in criminal charges; and (c) Leading a debtor to believe that the collectors decision to report an alleged criminal offence will depend on whether or not a payment is made." 25 In addition an order is sought that Ms McCaskey, within three months from the date of the order, attend a Trade Practices Compliance Programme seminar: "(i) conducted by Bruce Havilah & Associates in terms of the annexed seminar outline (Annexure "A"); and (ii) which addresses the provisions of Sections 52, 53 and 60 of the Act;" Within one week of attending the Seminar, she would be required to notify the ACCC of her attendance. An order is sought that Ms McCaskey pay the ACCC's costs of the proceedings against her in the sum of $2,000. 26 As against the second respondent, Cash Return Mercantile Pty Ltd, declarations, based on Ms McCaskey's conduct, that the company has contravened ss 52, 53(g) and 60 of the Act are proposed. Injunctive relief involving three separate injunctions, similar to those sought against Ms McCaskey, are proposed. In addition an order in the following terms has been agreed: "6. An order that within 21 days from the date of this order the Second Respondent at its own expense, cause to be published in "The West Australian" newspaper an advertisement in the form annexed hereto as Annexure "A" and further that such advertisement be: (i) of a size not less than 2 columns wide; (ii) in text which is in a type not less than 8 point; (iii) published on a page on the right hand side of the newspaper; and (iv) published once on a Saturday within the first 10 pages of the newspaper." A copy of the proposed advertisement is set out below: "An Apology by Cash Return Mercantile Pty Ltd In legal proceedings taken by the Australian Competition and Consumer Commission (ACCC), the Federal Court has declared that Cash Return Mercantile Pty Ltd ("Cash Return") contravened sections 52, 53(g) and 60 of the Trade Practices Act 1974. The Court found that Cash Return and one of its agents had, while collecting debts from consumers, . made an excessive number of telephone calls to debtors; . adopted an aggressive and abusive manner in those telephone calls; and . misrepresented the consequences of non payment of the debt and of debt recovery procedures. The Act prohibits a corporation (or its servants or agents) from using physical force, undue harassment or coercion in collecting a debt for goods or services from a consumer; engaging in misleading or deceptive conduct, and making false representations about a right or remedy. Cash Return has since sold its debt collection business and is no longer involved in the collection of debts from consumers. Cash Return sincerely apologises to debtors affected by its improper conduct." An order for costs against the company in the sum of $6,000 has also been agreed.

Statutory Framework 27 Section 52 of the Trade Practices Act is in the following terms: "52(1) A corporation shall not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive. (2) Nothing in the succeeding provisions of this Division shall be taken as limiting by implication the generality of subsection (1)." Section 53, in the relevant parts, provides as follows: "53. A corporation shall not, in trade or commerce, in connexion with the supply or possible supply of goods or services or in connexion with the promotion by any means of the supply or use of goods or services: . . . (g) make a false or misleading representation concerning the existence, exclusion or effect of any condition, warranty, guarantee, right or remedy." Section 60 provides: "A corporation shall not use physical force or undue harassment or coercion in connection with the supply or possible supply of goods or services to a consumer or the payment for goods or services by a consumer." 28 The extended application of the Act to other than trading or financial corporations is the subject of s 6 which relevantly provides, in subs (3): "6(3) In addition to the effect that this Act, other than Parts IIIA and X, has as provided by subsection (2), the provisions of Part IVA and of Divisions 1, 1A and 1AA of Part V have, by force of this subsection, the effect they would have if: (a) those provisions (other than section 55) were, by express provision, confined in their operation to engaging in conduct to the extent to which the conduct involves the use of postal, telegraphic or telephonic services or takes place in a radio or television broadcast; and (b) a reference in those provisions to a corporation included a reference to a person not being a corporation." 29 Section 80, which relates to the grant of injunctions under the Act, provides in the relevant parts: "80(1) Subject to subsections (1A), (1AAA), and (1B), where, on the application of the Commission or any other person, the Court is satisfied that a person has engaged, or is proposing to engage, in conduct that constitutes or would constitute: (a) a contravention of any of the following provisions: (i) a provision of Part IV, IVA, IVB or V; (ii) section 75AU or 75AYA; . . . (e) being in any way, directly or indirectly, knowingly concerned in, or party to, the contravention by a person of such a provision; or . . . the Court may grant an injunction in such terms as the Court determines to be appropriate. 80(1AA) Where an application for an injunction under subsection (1) has been made, whether before or after the commencement of this subsection, the Court may, if the Court determines it to be appropriate, grant an injunction by consent of all the parties to the proceedings, whether or not the Court is satisfied that a person has engaged, or is proposing to engage, in conduct of a kind mentioned in subsection (1)."

Approach to the Consent Orders 30 The approach of the Court to the making of consent orders is informed by a general principle of judicial restraint. It is not the function of the Court to impede settlements between parties who are legally represented and able to understand and evaluate the desirability of agreeing to a settlement. Nor will the Court refuse to give effect to the terms of a settlement by refusing to make orders or accept undertakings where they are within jurisdiction and otherwise unobjectionable. The Court will not substitute orders which it thinks appropriate if those proffered are within power and within the range of appropriate dispositions of the case. But in making orders by consent or otherwise, the Court must ensure that the orders are within power and appropriate for it is exercising a public function in doing so and must have regard to the public interest - Australian Competition and Consumer Commission v Real Estate Institute of Western Australia Inc (1999) 95 FCR 114 at 131. In considering the orders proposed in this case, I have regard to the observations about the scope of the injunctive power under s 80 and the power to order corrective advertising under s 80A discussed in ACCC v REIWA and the cases there mentioned at 132-134. The Declaratory Orders Based on Sections 52 and 53(g) of the Trade Practices Act 31 The declaratory relief sought against Ms McCaskey, in relation to ss 52 and 53(g) paraphrases, in three paragraphs, representations which it is admitted she made in various of her telephonic contacts and declares them to have been "conduct involving the use of telephonic services in trade or commerce" which are respectively misleading or deceptive in contravention of s 52 or false or misleading representations concerning the existence of a right or remedy in contravention of s 53(g). 32 The order sought will be within power if the conduct it identifies falls within the scope of that prohibited by those provisions of the Act. I am satisfied that each of the first two paragraphs of the declaration properly identifies misleading or deceptive conduct involving representations, in the first case as to the availability of legal remedies against Ms Piercy's house, and in the second case, as to the potential criminal liability of Jason Standing arising from the stopping of his cheque. The third paragraph asserts misleading or deceptive conduct by Ms McCaskey in representing that Norma Campbell was personally responsible for the debt owed by Abstract Signs to Superfine Print and that a summons would be issued and served immediately by Cash Return against the San Remo store conducted by Mr and Mrs Campbell when neither had any legal liability or responsibility for the debt. 33 I consider there is a difficulty with the third paragraph in relation to s 52. An agent who, on instructions, asserts that an alleged debtor is liable and seeks payment of the debt under threat of recovery action does not engage in misleading or deceptive conduct just because, on the true facts of the case, the alleged debtor is not liable. The assertion of liability if reasonably based on instructions, may be the statement of an opinion honestly held or a representation of the opinion of the creditor. A legal practitioner writing a letter of demand on instructions which there are no reasons to disbelieve, does not engage in misleading or deceptive conduct if a court subsequently finds there to be no liability. The declaration alleges simply that there was no legal liability on the part of the Campbells thereby falsifying the assertion to the contrary attributed to Ms McCaskey. It does not allege a statement by Ms McCaskey of an opinion which she did not hold or for which there could be no reasonable basis. On the face of it the third paragraph of the declaration does not identify a contravention of s 52 and I decline to make it. A fortiori it does not identify a contravention of s 53(g). This is not to say that such contraventions could not be found on the agreed facts. But here I am addressing the terms of the proposed declaration itself. 34 Paragraph 53(g) must be read in light of the definitions of "goods" and "services" in s 4(1) of the Act. The class of prohibited representation is limited by the requirements: "(a) that the representation is made "in trade or commerce"; (b) that the representation is made in connexion with the supply or possible supply of goods or services or in connexion with the promotion by any means of the supply or use of goods or services." The section is directed, on the face of it, at representations related to the acquisition of goods or services. It may extend to post contractual representations. As is said in Heydon, Trade Practices Law (Law Book Co) Vol 1 at 12.760: "The statement which infringes s 53(g) may be made before or after the contract, warranty, or guarantee which it speaks of: it need not be contemporaneous with it. This is because the main body of s 53 refers to statements "in connection with the supply or possible supply" of goods or services. "Possible supply" plainly refers to future supply - not only future supply under an existing contract but future supply under a future contract…. This conclusion is fortified by the words "in connexion with the promotion by any means of the supply or use of goods or services". "Supply" refers both to contemporaneous supply and past supply; so a supplier who is asked to satisfy a guarantee and makes a misleading statement narrowing its effect is liable." 35 The declaratory relief sought against Ms McCaskey would characterise her representation to Ms Piercy about the availability of an immediate legal remedy against her house and to Mr Standing in relation to the Fraud Squad as "false and misleading representations concerning the existence and effect of [a] right or remedy contrary to s 53(g) of the Act". In each case it is asserted in the body of the declaration that the representation was made "in connection with the supply of debt collection services" to Ann-Marie Adam and to Searle Mobile Veterinary Services respectively. The joint submission offered no analysis of this application of par 53(g) to the circumstances recited in the proposed declarations. The application is not obvious. It is concerned not with representations about the existence, exclusion or effect of any right or remedy by the consumer against a supplier but rather the availability of a right or remedy by the supplier against the consumer. There appears to be neither case law nor commentary in the major texts which would suggest this application of par 53(g). 36 In its original form in the Trade Practices Act, par 53(g) read as follows: "53 A corporation shall not, in trade or commerce, in connection with the supply or possible supply of goods or services or in connection with the promotion by any means of the supply or use of goods or services - . . . (g) make false or misleading statements concerning the existence or effect of any warranty or guarantee." In its Report to the Minister for Business and Consumer Affairs dated August 1976, the Trade Practices Review Committee (The Swanson Committee) made reference to par 53(g) at par 9.77 of its Report thus: "Further technical difficulties were submitted to the Committee in connection with the use of the terms 'warranty' and 'guarantee' in paragraph 53(g). The particular problems were that those concepts were too restrictive and should be extended to include any statements as to the existence of rights or remedies for the purchaser. The primary problem that has been raised is that of misleading statements as to the exclusion of conditions and warranties implied under Division 2 or State Acts. Doubts have been expressed whether paragraph 53(g) adequately deals with this type of case. We recommend that any doubts in this respect be removed, so that the paragraph clearly covers the matter." (emphasis added) The Committee's recommendation was given effect by the Trade Practices Amendment Act 1977 which substituted for the original par 53(g) a new paragraph which read as follows: "(g) Make a false or misleading statement concerning the existence, exclusion or effect of any condition, warranty, guarantee, right or remedy." The term "representation" was introduced by the Trade Practices Revision Act 1986. In its original form par 53(g) was plainly directed to warranties or guarantees promised or given by the supplier to the consumer. The insertion of the reference to "conditions, rights and remedies" was to overcome the technical limits of the terms "warranty" and "guarantee". Warranties and guarantees are benefits conferred on the purchaser and the rights and remedies contemplated were also as the Committee Report made plain "for the purchaser". It may be possible to read this provision as covering the case in which a right or remedy is asserted by the supplier against the purchaser relating to the supplier's right to payment and the remedies for that right. But this is a strained reading and a doubtful construction. In any event it is not the reading relied upon in the proposed declaration. Alternatively it might be argued that the representations are made in connection with the supply of debt collecting services to the clients of Cash Return, albeit the representations are made to third parties who on this analysis are neither suppliers nor purchasers. This is the application of the provision relied upon by the ACCC. This also, in my opinion, is a doubtful construction involving no representation to the consumer of the relevant services or any agent or other party who might convey a representation to a consumer. Rather it relies upon a representation made to a supplier's customer by a person seeking to collect payment on behalf of the supplier. Allowing that, notwithstanding the plain history and purpose of the provision it may be possible to extract such readings from its literal words, the question arises what is the proper approach to its construction? 37 Section 79 of the Act provides that contravention of provisions of Part 5 other than ss 52, 65Q, 65R and 65S(9) are offences punishable on conviction by fines. Paragraph 53(g) therefore defines a criminal offence punishable as provided in s 79. In a passage from the judgment of Gibbs J in Beckwith v R (1976) 12 ALR 333 at 339, endorsed by the High Court in Deming No 456 Pty Ltd v Brisbane Unit Development Corp Pty Ltd (1983) 50 ALR 1 at 15 and Waugh v Kippen (1986) 64 ALR 195 at 200, his Honour said: "The rule formerly accepted, that statutes creating offences are to be strictly construed, has lost much of its importance in modern times. In determining the meaning of a penal statute the ordinary rules of construction must be applied, but if the language of the statute remains ambiguous or doubtful the ambiguity or doubt may be resolved in favour of the subject by refusing to extend the category of criminal offences…The rule is perhaps one of last resort." That observation, among others, was applied by Franki J to the construction of s 59 of the Act in Thompson v Master Touch TV Services Pty Ltd (1977) 15 ALR 487 at 496-497. See generally Pearce and Geddes, Statutory Interpretation in Australia, 4th Edition, Butterworths par 9.7-9.8. 38 In my opinion the construction necessary to support the claimed application of par 53(g) in this case is, at the very least, doubtful and should not be accepted particularly having regard to its penal character. It is inconsistent with its history and apparent purpose. I do not propose to make those declarations in so far as they relate to the Piercy and Standing representations. And even if I am wrong on the constructional ground, I cannot see how the representation made to Mr Standing, which relates to possible criminal liability attaching to his stopped cheque, would be caught by the provision. 39 I am prepared to make the consent declarations sought against Ms McCaskey in relation to admitted contraventions of s 52 arising out of the Piercy and Standing incidents. For reasons previously set out I am not prepared to make a declaration of a contravention of s 52 arising out of the Campbell representations. I will not make declarations that Ms McCaskey has contravened par 53(g). For similar reasons I am prepared to make the first two declarations sought against Cash Return in so far as they allege contraventions of s 52. I am not prepared to make the third declaration sought against Cash Return which relates to the Campbell representations and involves alleged contraventions of s 52 and par 53(g). 40 The Court's task in reaching these conclusions about this aspect of the declaratory relief sought, is to decide whether the proposed orders are within power and appropriate. There has been little or no analysis or argument in the joint submission or otherwise in relation to these issues. A schedule of the orders sought which I am prepared to make is attached at the end of these reasons. They will take effect after seven days unless any of the parties indicates that it does not wish to consent to those orders and applies to make further submissions to the Court.

Negative Injunctions based on Section 52 and Paragraph 53(g) of the Trade Practices Act 1974 41 The two limbs of the declaratory relief just considered related to s 52 and par 53(g) of the Trade Practices Act. Corresponding injunctive relief is also agreed between the parties. In the case of Ms Caskey, the injunctive orders numbered 4 and 5, set out earlier in these reasons, relate to conduct said to contravene par 53(g) and s 52 respectively. The conduct they would enjoin in each case is identical. It is characterised more narrowly in the injunction set out in par 4 of the consent order, which relates to par 53(g), than in the injunction set out in par 5 of the order which relates to s 52. Even if par 53(g) were applicable to the conduct in question, I would see no useful purpose being served by two injunctions covering the same conduct differently characterised where one characterisation (contravention of s 53(g)) would be a subset of the other (contravention of s 52). None is suggested. The same is true of the injunctions numbered 4 and 5 against Cash Return. 42 In the case of Ms McCaskey, the injunction sought against her is not limited to conduct in the use of telephonic services which conduct would attract the extended operation of the Trade Practices Act and which is the basis, set out in the statement of claim, of the relief claimed against her. There is no suggestion in the application or statement of claim nor in the joint submission, that any reliance is placed upon the Fair Trading Act 1987 (WA) via the exercise of the Court's accrued jurisdiction or otherwise. An injunction must in the circumstances of this case restrain conduct which contravenes the Act. In the case of Ms McCaskey that conduct involves the use of telephonic services. Accessorial liability, which might have picked up a wider range of conduct, is not reflected in the terms of the order which makes no reference to the conduct of any principal. 43 For these reasons I am not prepared to make orders in terms of the injunctions numbered 4 in each of the consent orders. I am prepared to make an order in terms of the injunction numbered 5 against Ms McCaskey provided that it is confined to conduct involving the use of telephonic services. I am prepared to grant an injunction against Cash Return in the terms of the order numbered 5 in the court order to which it has agreed. Section 60 of the Trade Practices Act 1974 44 The elements of the conduct prohibited by s 60 are as follows: 1. It is the conduct of a corporation or a person to whom the extended operation of the Act applies. 2. It is conduct: (a) in connection with the supply or possible supply of goods or services to a consumer; (b) in connection with the payment for services by a consumer. 3. It is one or more of the following: (a) use of physical force; (b) undue harassment; (c) coercion. 45 Section 60 is to be contrasted with s 53A(2) which is not limited to conduct in relation to consumers and provides: "53A(2) A corporation shall not use physical force or undue harassment or coercion in connection with the sale or grant, or the possible sale or grant, of an interest in land or the payment for an interest in land." Like provisions are to be found in s 55 of the Fair Trading Acts of the various States. The Fair Trading Act of the ACT, in s 26(2), does set out non-exhaustively conduct defined as undue harassment or coercion. The specific conduct includes misrepresenting to a debtor the consequences of non-payment of debt or of debt recovery procedure and unreasonable communication with a debtor. 46 Section 60 as originally enacted in 1974 was in the following terms: "60. A corporation shall not cause or permit a servant or agent of the corporation to use, at a place of residence, physical force, undue harassment or coercion in connexion with the supply or possible supply of goods or services to a consumer or the payment for goods or services by a consumer." The Swanson Report had little to say about this provision observing shortly at pars 9.92 and 9.93: "9.92 We draw to the attention of the legislative draftsman the suggestion made in some submissions that there is an unnecessary complication between sub-section 84(2) and the words "cause or permit a servant or agent of the corporation" in section 60. Unnecessary complication should, of course, be avoided. 9.93 Some criticism was made of the restriction of the prohibition to "undue harassment". We are not satisfied that there is a case for changing this requirement." The section was unchanged by the 1977 amendments. However, in 1986 its present form was substituted by the Trade Practices Revision Act 1986. The reference to a servant or agent of a corporation was deleted in accordance with the observation in the Swanson Committee Report. So too was the limitation to such conduct at a place of residence. 47 It is the second limb of the conduct defined by s 60 namely "…undue harassment or coercion in connection with…the payment for goods or services by a consumer" that is in issue in this case. The words of the section are to be given their ordinary meanings relevant to the context in which they appear. The term "harass" as defined in the new Shorter Oxford English Dictionary defines from the French "harasser", a pejorative derivation of the word "harer" meaning "to set a dog upon". The definitions of the word are thus: "1. Trouble by repeated attacks. Now Freq; subject to constant molesting or persecution. 2. Lay waste, devastate. 3. Tire out, exhaust. 4. Overwhelm with cares and misfortunes etc - Chiefly as harassed." The meaning of primary relevance here is the first, but it is important to have regard to context in considering its application in s 60. In this respect judicial exegesis, in other statutory settings, of concepts such as "sexual harassment" is of little assistance. Sexual harassment under the Sex Discrimination Act does not require a demonstration of repeated unwelcome approaches - Hall v A & A Sheiban Pty Ltd (1989) 85 ALR 503 at 514 (Lockhart J), 523 (Wilcox J), 567 (French J). And see O'Callaghan v Loder [1984] EOC 92-023 at 75,505. That proposition derived from the language of s 28(3) of the Sex Discrimination Act. Certainly it is consistent with the ordinary meaning of "harass" as involving an element of repetition to speak of a harassed state of mind arising out of one or more events - Johnston v Collier (1997) 142 FLR 409 at 412 (Anderson J). But there, "harassed" is used in the fourth of the defined meanings and relates to the state of mind of a person induced by an event or events none of them necessarily amounting to harassment. A person can feel harassed because something has gone wrong for which nobody is to blame. 48 The word "harassment" as used in s 60 must serve two broad purposes. It describes a range of conduct, in connection with the supply of goods or services which involve, inter alia, applying repeated pressure to a consumer who is under no pre-existing obligation to acquire. It also describes conduct in relation to a consumer who is under an unfulfilled obligation to pay for goods or services. Given the range of cases that it can cover, the question whether or not there is harassment involves evaluative judgment. The word "undue" adds an extra layer of evaluation which is more relevant to the case of debt recovery than to the sale of goods or services. Repeated unwelcome approaches to a potential acquirer of goods or services could qualify as harassment and, so qualified, require very little additional evidence, if any, to attract the characterisation of "undue harassment". On the other hand a consumer who owes money to a supplier can expect repeated unwelcome approaches requesting payment of the debt if he or she does not pay. No doubt such approaches might also qualify as harassment. If legitimate demands are reasonably made, on more than one occasion, for the purpose of reminding the debtor of his or her obligation and drawing the debtor's attention to the likelihood of legal proceedings if payment is not made, then that conduct, if it be harassment, is not undue harassment. If, however, the frequency, nature or content of the approaches and communications associated with them is such that they are calculated to intimidate or demoralise, tire out or exhaust a debtor rather than convey the demand and an associated legitimate threat of proceedings, the harassment will be undue. 49 Section 60 can also cover cases in which the conduct complained of lacks the element of repetition necessary to constitute harassment, undue or otherwise. This requires consideration of the term "undue coercion". 50 The word "coercion" is defined in the Shorter Oxford English Dictionary thus: "1. The action of coercing; constraint, restraint, compulsion. 2. Government by force; the employment of force to suppress political disaffection and disorder. 3. Physical pressure; compression. 4. Coercitive power or jurisdiction." The verb "coerce" is defined as: "1. To constrain or restrain by force, or by authority resting on force. 2. To subject to restraint in the matter of (rare) 1780. 3. To effect by compulsion." 51 The collection of debts may involve coercion in the sense that the debtor is subjected to the pressure of the demand and the legitimate threat of civil process for recovery with the additional cost and damage to credit which that can involve. Such pressure may be thought of as coercion but is entirely legitimate and not "undue". Where the demand includes content which does not serve legitimate purposes of reminding the debtor of the obligation and threatening legal proceedings for recovery but is calculated otherwise to intimidate or threaten the debtor, then the coercion may be undue. So if a threat is made of criminal proceedings, or of the immediate seizure and sale of house and property, a remedy not available in the absence of retention of title or some form of security, the coercion is likely to be seen as undue. The threat of criminal proceedings itself may be an offence against State laws. Quite apart from content the manner or circumstances of a demand or communication, including the language used, the time and place at which it is made and the person to whom it is communicated, may go beyond the legitimate purposes of drawing attention to the existence of the obligation and the consequences for non-compliance. Again such a communication may amount to undue coercion. Obvious examples include the use of personally abusive or obscene language, conveying the demand to uninvolved family members, particularly children, or conveying the demand through a third party in order to embarrass the debtor when the debtor could reasonably have been the subject of a direct communication. Each case will turn on its own facts. Some useful examples of situations that may give rise to contraventions of s 60 are set out in the ACCC guidelines entitled "Debt Collection and the Trade Practices Act" published in July 1999. As pointed out of course that publication is not a statement of the law. It can only be a guide. The recovery of unpaid debts can be pursued with firmness, determination and civility. It can do all those things without resorting to bullying, bluff, misrepresentation or stand-over tactics. If it does the first and avoids the second it is unlikely to contravene the law. 52 A supplier of goods or services or a debt collector, in deciding upon the approach to be taken to a debtor, should ask the question: "Are the content, the timing, the location and other circumstances of my demand for payment reasonably calculated to remind the debtor of his or her obligation, specify a time within which it must be satisfied and indicate that civil proceedings for recovery will be instituted if payment is not made?" This is not a script for the form of demand. Rather it is a statement of the legitimate purpose to be served in pursuing payment for goods or services acquired by a consumer. The content, the manner, the timing and the location of a demand for payment may be made in a variety of ways, all of which may be legitimate according to the circumstances provided they serve that essential purpose. This is to say nothing about the desirability of flexible approaches to debtors in difficulty through no fault of their own. Nor does it say anything about the desirability of negotiated settlements and recognising that if a debtor has a number of debts to different suppliers, a realistic approach to repayment arrangements may be necessary. A creditor who disregards these considerations may be cutting off his nose to spite his face, but s 60 has nothing to say about that. 53 It appears that to date there has only been one reported case on the section. The case, on appeal from a Master's order striking out a statement of claim alleging contraventions of s 55 of the Fair Trading Act (NSW), was heard by McInerney J. It is reported as Campbell v Metway Leasing Ltd (1998) ATPR 41-630. There were various incidents said to constitute undue harassment or coercion contrary to the State Act. McInerney J allowed the appeal on the basis that the Master, who had struck out the statement of claim should have allowed leave to amend. His Honour's consideration of s 55 was brief. He observed that there is no requirement in the section that the harassment or coercion involve a threat of an illegal act, whether criminal, tortious or contractual, but rather only that the harassment and coercion be undue. I respectfully agree with that observation. His Honour also observed that the section does not expressly exclude the institution of legal proceedings from its ambit. But legal proceedings which were not themselves vexatious, frivolous or an abuse of process could not, in his Honour's view constitute undue harassment or coercion for the purposes of s 55. A plaintiff, within reasonable bounds, has a legitimate right of recourse to the courts for the determination of his or her claim. It is not necessary for me to do other than note that observation as it is not an issue which falls for consideration in this case.

The Declaratory Relief in Relation to Section 60 54 The proposed declaration of contraventions of s 60 by Ms Caskey relies upon her various telephone contacts with Linda Byart (par (a)), Ms Piercy and her son, Bradley, (par (b)), Mr Elmslie (par (c)), Mr Standing (par (d)) and Mrs Campbell (par (e)). These incidents are listed and the declaration sought that by reason of them Ms McCaskey has, by conduct involving the use of telephonic services, used undue harassment and coercion in connection with the payment of goods or services by a consumer contrary to s 60 of the Trade Practices Act 1974. 55 The declaration is not to be read as referring to each of the incidents as constituting both undue harassment and coercion. I am inclined to think that most of the incidents fall within the scope of undue coercion. Some of them, however, arguably also constitute undue harassment. I consider that the declaration is within power and appropriate and having regard to the parties' agreement I am prepared to make it in the terms they propose. I am also prepared to make the like declaration in relation to Cash Return.

Injunctions Relating to Contraventions of Section 60 56 The injunction proposed against Ms McCaskey against contravening s 60 has been set out earlier in these reasons. It is to be noted that the conduct actually restrained is described in pars (a), (b) and (c) in exactly the same terms as the conduct covered by the injunction in par 5 of the consent order relating to misleading or deceptive conduct. Paragraphs (d) and (e) would restrain the use of abusive, offensive or obscene language to a debtor or third party and telephone calls at a frequency of more than three per calendar week personally answered by the debtor. While there is an overlap between the conduct restrained by this injunction and that restrained by the injunction dealing with misleading or deceptive conduct, it is not, properly characterised, a subset of misleading or deceptive conduct as was the conduct covered by proposed injunction 4. The two injunctions can therefore run in parallel subject to the qualification that as with the injunction numbered 5, the proposed injunctions must be limited to the use of telephonic services. 57 The injunction against Cash Return relating to contraventions of s 60 will be made in the terms proposed.

Compliance Programmes 58 The consent order sets out a compliance programme to be undertaken by Ms McCaskey in the terms set out earlier in these reasons. In ACCC v Real Estate Institute of Western Australia I agreed to a consent order for a compliance programme to assist in overcoming what appeared to be a want of institutional sensitivity to, and understanding of, the provisions of Part IV. I am informed from the Bar Table that Ms McCaskey intends to continue to work in the debt collection area. If she is to do that in a way that complies with the law she is going to have to undertake a major reorientation of her approach and attitude to the job. The unprofessional aggression and rudeness she displayed in her dealings with alleged debtors will have to be put behind her if she is not to get herself and her future employers into difficulty again. The proposed compliance programme should assist her in that regard. It is to be provided by her present solicitors. I note that the seminar headings set out in the outline programme reflect, to some extent, matters canvassed in the ACCC guidelines. They are helpful prudential guidelines for conduct which, if adhered to, should minimise the risk of contravening the law. But no regulator or court or legal adviser can write a script for behaviour to cover every case that may arise. In the end the debt collector properly pursuing her legitimate and socially valuable function, should test what she does by posing for herself the question which I have earlier posed. 59 The proposed compliance programme is appropriate and within the power conferred by s 80 of the Act. No compliance programme is sought against Cash Return since the sale of its business.

Publication of Notice 60 An order is sought for Cash Return to publish a notice by way of apology in the terms set out earlier in these reasons. In Australian Competition and Consumer Commission v Real Estate Institute of Western Australia at 132-133 I reviewed the authorities and principles governing the making of such orders. A legitimate purpose of an order for such advertisements flowing from contraventions of Part IV or Part V is to inform the relevant public or markets of the outcome of the litigation. In that way the public and those in the relevant markets for goods and services have at least a broad understanding of the way in which the particular contraveners have behaved and have had to change their conduct. They will increase the probability that the public and those in the relevant markets may be put on inquiry about the lawfulness of future conduct by the contravener which may be seen to breach the act and/or the injunctions which have been granted. In this way public advertising may assist in the enforcement of the injunctive orders and the prevent of repetition of the contravening conduct. When there has been misleading or deceptive conduct, a notice may be ordered to correct what has been mis-stated. 61 Importantly it is not in my opinion appropriate to order such notices simply to announce a win for the ACCC or the contrition of the respondent. Nor is the general education of the public about the Trade Practices Act a price to be exacted from a respondent for transgressing. So the notice must be related to righting the wrong which has been done or aiding in the enforcement of the other orders made. As with the debt collection process itself, the test of the proposed course of action is whether it is calculated to serve and only to serve the legitimate purposes of the law. 62 In this case the notice proposed is headed "An Apology". Notwithstanding my reservations about the inappropriateness of orders for the publication of statements of contrition, the proposed notice is an appropriate way of drawing to the attention of those debtors whom it was sought to threaten, intimidate and abuse, that Cash Return accepts the inpropriety of that conduct. In my opinion the notice is within power and appropriate and orders will be made accordingly.

Conclusion 63 For the preceding reasons, I am prepared to make the orders set out in the Further Revised Minutes of Proposed Consent Orders subject to the following modifications: A. In relation to the first respondent - Sharyn McCaskey:

Delete par 2(c). 2. Delete par 2-B. 3. Limit the injunction in par 3 to conduct involving the use of telephone services. 4. Delete par 4. 5. Limit the injunction in par 5 to conduct involving the use of telephonic services. B. In relation to the second respondent - Cash Return Mercantile Pty Ltd: 1. Delete par 2(c). 2. Delete par 2-B 3. Delete par 4. The proposed orders will take effect at the expiry of seven days unless the parties file a request for relisting of the directions on the basis that any one or more of them will not consent to the proposed orders.

ADDENDUM 64 Upon judgment being delivered in this matter the ACCC indicated it was content with the orders proposed. The Second Respondent also indicated its agreement. The First Respondent did not appear at the delivery of the judgment but, having regard to her prior consent to orders in wider terms than those which I regard as appropriate, I was prepared to make the orders as set out in the Schedule. An order was made accordingly.

I certify that the preceding sixty four (64) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice French .

Counsel for the Applicant: Mr RL Le Miere QC

Solicitor for the Applicant: Australian Government Solicitor

Counsel for the First Respondent: Mr B D Havilah

Solicitor for the First Respondent: Bruce Havilah & Associates

Counsel for the Second Respondent: Mr N W Marsh Solicitor for the Second Respondent:

Julienne Penny & Associates Date of Hearing: 17 July 2000

Date of Judgment: 1 August 2000

SCHEDULE ORDERS TO BE MADE AGAINST THE FIRST RESPONDENT 1. A declaration that by reason of: (a) the threatening, aggressive and excessive manner and content of the First Respondent's telephone contact (on behalf of the Second Respondent) with Linda Byart of TouchGold Pty Ltd in the period between January 1998 to February 1998 in connection with the collection of payment from Linda Byart for video conferencing services supplied to TouchGold Pty Ltd by Reward Consulting Pty Ltd (trading as NetNology); (b) the undue frequency of the First Respondent's telephone contact (on behalf of the Second Respondent) with Margaret Piercy and her son Bradley Stott in November 1998, and the threatening, aggressive and overbearing manner and content of that telephone contact with Margaret Piercy and Bradley Stott in connection with the collection of payment from Margaret Piercy for legal services supplied to Margaret Piercy by Ann-Marie Adam; (c) the threatening, aggressive and abusive manner and content of the First Respondent's telephone contact (on behalf of the Second Respondent) with Barry Elmslie of Able Finance Broking Services in November 1998, in connection with the collection of payment from Margaret Piercy for legal services supplied to Margaret Piercy by Ann-Marie Adam; (d) the threatening, aggressive and abusive manner and content of the First Respondent's telephone contact (on behalf of the Second Respondent) with Jason Standing in March 1999 in connection with the collection of payment from Jason Standing for veterinary services supplied to Jason and Michelle Standing by Searle Mobile Veterinary Services; and (e) the undue frequency of the First Respondent's telephone contact (on behalf of the Second Respondent) with Norma Campbell in March 1999, and the threatening, aggressive and intimidating manner and content of that telephone contact with Norma Campbell in connection with the collection of payment from Norma Campbell for business cards supplied by Superfine Print to Abstract Signs, a business operated by Norma Campbell's son-in-law Chris Cook, the First Respondent has, by conduct involving the use of telephonic services, used undue harassment and coercion in connection with the payment for goods or services by a consumer contrary to section 60 of the Trade Practices Act 1974 ("the Act"). 2. A declaration that by reason of: (a) the First Respondent, on behalf of the Second Respondent, in connection with the supply of debt collection services to Ann-Marie Adam, having made representations over the telephone to Margaret Piercy and her son Bradley Stott in November 1998 to the effect that the Second Respondent was taking, or was about to take, immediate steps to sell Margaret Piercy's residence to obtain payment of the debt owed by Margaret Piercy to Ann-Marie Adam, when no steps could then be taken to sell Margaret Piercy's residence as no legal proceedings to recover the debt owed by Margaret Piercy to Ann-Marie Adam had, at the date of the representations, been commenced; (b) the First Respondent, on behalf of the Second Respondent, in connection with the supply of debt collection services to Searle Mobile Veterinary Services, having made representations over the telephone to Jason Standing in March 1999 to the effect that the First Respondent would arrange to have Standing arrested by the police or the Fraud Squad if he did not make immediate payment of the debt allegedly due to Searle Mobile Veterinary Services, when there was no reasonable basis upon which the First Respondent could have taken action to request or arrange for the police or the Fraud Squad to arrest Standing in connection with a debt collection matter. The First Respondent, by conduct involving the use of telephonic services, in trade or commerce, engaged in conduct that was misleading and deceptive contrary to s 52 of the Act. 3. An injunction for three (3) years restraining the First Respondent from using undue harassment or coercion in connection with the payment for goods or services by a consumer by conduct involving the use of telephonic services: (a) representing that action will be taken that the First Respondent has no reasonable basis for believing that she is legally permitted to take, or does not have instructions or authority to take, at the time the representation is made; (b) threatening criminal action if a debt is not paid or engaging in conduct that is likely to lead a debtor to believe that criminal action could be a consequence of non-payment, if at the time the First Respondent has no reasonable basis for believing that the non-payment would result in criminal charges; (c) leading a debtor to believe that the collector's decision to report an alleged criminal offence will depend on whether or not a payment is made; (d) using abusive, offensive or obscene language to a debtor or a third party; and (e) making more than three (3) telephone calls per calendar week which are personally answered by the debtor, unless the debtor otherwise agrees to further telephone calls. 4. An injunction for three (3) years restraining the First Respondent from engaging in conduct involving the use of telephonic services in trade or commerce, that is misleading or deceptive, or is likely to mislead or deceive a person in connection with the collection of payment of debts from any person by: (a) representing that action will be taken that the First Respondent has no reasonable basis for believing that she is legally permitted to take, or does not have instructions or authority to take, at the time the representation is made; (b) threatening criminal action if a debt is not paid or engaging in conduct that is likely to lead a debtor to believe that criminal action could be a consequence of non-payment, if at the time the First Respondent has no reasonable basis for believing that the non-payment would result in criminal charges; and (c) leading a debtor to believe that the collector's decision to report an alleged criminal offence will depend on whether or not a payment is made. 5. An order that the First Respondent: (a) within three (3) months from the date of this order, attend a Trade Practices Compliance Programme seminar ("the Seminar"): (i) conducted by Bruce Havilah & Associates in the terms of the annexed seminar outline; and (ii) which addresses the provisions of Sections 52, 53 and 60 of the Act; and (b) within one week of attending the Seminar, notify the Applicant of her attendance. 6. An order that the First Respondent pay the Applicant's costs of the proceedings against the First Respondent in the sum of $2,000.

ANNEXURE TRADE PRACTICES COMPLIANCE PROGRAMME SEMINAR OUTLINE 1. Introduction 2. The Trade Practices Act 2.1 Section 52 2.2 Section 53 2.3 Section 60

Conduct Principles 3.1 Undue harassment and coercion. 3.2 Misleading and deceptive conduct. 3.3 False representations in terms of section 53(g). 3.4 Language, violence and physical force. 3.5 Communicating with the debtor away from their workplace. 3.6 Communicating with the debtor at the debtor's workplace. 3.7 Communicating with a debtor's representative. 3.8 Communicating with third parties. 3.9 Frequency of communications. 3.10 Personal visits. 3.11 Allowing arrangements and other processes to work.

ORDERS TO BE MADE AGAINST THE SECOND RESPONDENT 1. A declaration that by reason of: (a) the threatening, aggressive and excessive manner and content of the First Respondent's telephone contact (on behalf of the Second Respondent) with Linda Byart of TouchGold Pty Ltd in the period between January 1998 to February 1998 in connection with the collection of payment from Linda Byart for video conferencing services supplied to TouchGold Pty Ltd by Reward Consulting Pty Ltd (trading as NetNology); (b) the undue frequency of the First Respondent's telephone contact (on behalf of the Second Respondent) with Margaret Piercy and her son Bradley Stott in November 1998, and the threatening, aggressive and overbearing manner and content of that telephone contact with Margaret Piercy and Bradley Stott in connection with the collection of payment from Margaret Piercy for legal services supplied to Margaret Piercy by Ann-Marie Adam; (c) the threatening, aggressive and abusive manner and content of the First Respondent's telephone contact (on behalf of the Second Respondent) with Barry Elmslie of Able Finance Broking Services in November 1998, in connection with the collection of payment from Margaret Piercy for legal services supplied to Margaret Piercy by Ann-Marie Adam; (d) the threatening, aggressive and abusive manner and content of the First Respondent's telephone contact (on behalf of the Second Respondent) with Jason Standing in March 1999 in connection with the collection of payment from Jason Standing for veterinary services supplied to Jason and Michelle Standing by Searle Mobile Veterinary Services; and (e) the undue frequency of the First Respondent's telephone contact (on behalf of the Second Respondent) with Norma Campbell in March 1999, and the threatening, aggressive and intimidating manner and content of that telephone contact with Norma Campbell in connection with the collection of payment from Norma Campbell for business cards supplied by Superfine Print to Abstract Signs, a business operated by Norma Campbell's son-in-law Chris Cook, the Second Respondent has used undue harassment and coercion in connection with the payment for goods or services by a consumer contrary to section 60 of the Trade Practices Act 1974 ("the Act"). 2. A declaration that by reason of: (a) the First Respondent, on behalf of the Second Respondent, in connection with the supply of debt collection services to Ann-Marie Adam, having made representations over the telephone to Margaret Piercy and her son Bradley Stott, in November 1998 to the effect that the Second Respondent was taking, or was about to take, immediate steps to sell Margaret Piercy's residence to obtain payment of the debt owed by Margaret Piercy to Ann-Marie Adam, when no steps could then be taken to sell Margaret Piercy's residence as no legal proceedings to recover the debt owed by Margaret Piercy to Ann-Marie Adam had, at the date of the representations, been commenced; (b) the First Respondent, on behalf of the Second Respondent, in connection with the supply of debt collection services to Searle Mobile Veterinary Services, having made representations over the telephone to Jason Standing in March 1999 to the effect that the First Respondent would arrange to have Standing arrested by the police or the Fraud Squad if he did not make immediate payment of the debt allegedly due to Searle Mobile Veterinary Services, when there was no reasonable basis upon which the First Respondent could have taken action to request or arrange for the police or the Fraud Squad to arrest Standing in connection with a debt collection matter. . The Second Respondent, in trade or commerce, engaged in conduct that was misleading and deceptive contrary to section 52 of the Act. 3. An injunction for three (3) years restraining the Second Respondent, whether by itself, its servants, agents or howsoever, from using undue harassment or coercion in connection with the payment for goods or services by a consumer by: (a) representing that action will be taken that the Second Respondent has no reasonable basis for believing that it is legally permitted to take, or does not have instructions or authority to take, at the time the representation is made; (b) threatening criminal action if a debt is not paid or engaging in conduct that is likely to lead a debtor to believe that criminal action could be a consequence of non-payment, if at the time the Second Respondent has no reasonable basis for believing that the non-payment would result in criminal charges; (c) leading a debtor to believe that the collector's decision to report an alleged criminal offence will depend on whether or not a payment is made; (d) using abusive, offensive or obscene language to a debtor or a third party; and (e) making more than three (3) telephone calls per calendar week which are personally answered by the debtor, unless the debtor otherwise agrees to further telephone calls. 4. An injunction for three (3) years restraining the Second Respondent, whether by itself, its servants, agents or howsoever, from engaging in conduct, in trade or commerce, that is misleading or deceptive, or is likely to mislead or deceive a person in connection with the collection of payment of debts from any person by: (a) representing that action will be taken that the Second Respondent has no reasonable basis for believing that it is legally permitted to take, or does not have instructions or authority to take, at the time the representation is made; (b) threatening criminal action if a debt is not paid or engaging in conduct that is likely to lead a debtor to believe that criminal action could be a consequence of non-payment, if at the time the Second Respondent has no reasonable basis for believing that the non-payment would result in criminal charges; and (c) leading a debtor to believe that the collector's decision to report an alleged criminal offence will depend on whether or not a payment is made. 5. An order that within 21 days from the date of this order the Second Respondent, at its own expense, cause to be published in "The West Australian" newspaper an advertisement in the form annexed and further that such advertisement be: (i) of a size not less than 2 columns wide; (ii) in text which is in a type not less than 8 point; (iii) published on a page on the right hand side of the newspaper; and

(iv) published once on a Saturday within the first 10 pages of the newspaper. 6. An order that the Second Respondent pay the Applicant's costs of the proceedings against the Second Respondent in the sum of $6,000 within two (2) months from the date of this order.

ANNEXURE "An Apology by Cash Return Mercantile Pty Ltd In legal proceedings taken by the Australian Competition and Consumer Commission (ACCC), the Federal Court has declared that Cash Return Mercantile Pty Ltd ("Cash Return") contravened sections 52, 53(g) and 60 of the Trade Practices Act 1974. The Court found that Cash Return and one of its agents had, while collecting debts from consumers, . made an excessive number of telephone calls to debtors; . adopted an aggressive and abusive manner in those telephone calls; and . misrepresented the consequences of non payment of the debt and of debt recovery procedures. The Act prohibits a corporation (or its servants or agents) from using physical force, undue harassment or coercion in collecting a debt for goods or services from a consumer; engaging in misleading or deceptive conduct, and making false representations about a right or remedy. Cash Return has since sold its debt collection business and is no longer involved in the collection of debts from consumers. Cash Return sincerely apologises to debtors affected by its improper conduct."

Trade Practices Act 1974(Cth)s 52, par

Fair Trading Act 1987(WA)

At a glance

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Judgment (27 paragraphs)

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