Is the State amenable to a civil pecuniary penalty?
8 Whether the State is amenable to the imposition of a civil pecuniary penalty for contraventions of ss 340(1) and 343(1) of the FW Act is to be considered in the statutory context provided for by the FW Act. The CFMEU relies upon the following provisions to contend that the State is liable to be penalised for a contravention of a civil remedy provision:
(i) Sections 340(1) and 343(1) are "civil remedy provisions".
(ii) Section 546(1) of the FW Act empowers the Federal Court to order "a person to pay a pecuniary penalty that the Court considers is appropriate if the Court is satisfied that the person has contravened a civil remedy provision".
(iii) The State is "a person". Section 40A of the FW Act provides that the Acts Interpretation Act 1901 (Cth) as in force on 25 June 2009 ("the Acts Interpretation Act") applies to the interpretation of the FW Act. Section 22(1)(a) of the Acts Interpretation Act provided that:
(1) In any Act, unless the contrary intention appears:
(a) expressions used to denote persons generally (such as "person", "party", "someone", "anyone", "no-one", "one", "another" and "whoever"), include a body politic or corporate as well as an individual;
…
(iv) The FW Act binds the Crown. Section 37 of the FW Act provides:
(1) This Act binds the Crown in each of its capacities.
(2) However, this Act does not make the Crown liable to be prosecuted for an offence.
(v) A contravention of a civil remedy provision is not an offence (s 549).
9 Whilst the State accepts that it is bound by the FW Act, it denies that it is liable to have a pecuniary penalty imposed upon it for a contravention of a civil remedy provision. In making that contention, the State relies on the terms of s 546(2).
10 Section 546(2) of the FW Act provides:
The pecuniary penalty must not be more than:
(a) if the person is an individual - the maximum number of penalty units referred to in the relevant item in column 4 of the table in subsection 539(2); or
(b) if the person is a body corporate - 5 times the maximum number of penalty units referred to in the relevant item in column 4 of the table in subsection 539(2).
(Emphasis added.)
11 The State contends that when s 546(1) is read in context with s 546(2), the reference in s 546(1) to the Court's capacity to impose a penalty on "a person" must be read down by reference to the only kinds of persons identified in s 546(2), namely, "an individual" or "a body corporate". As the State is a body politic and not "an individual" or "a body corporate", the State contends that it is not amenable to the Court's power to impose a penalty on "a person".
12 To bolster its contention, the State relies upon the presumption explained by Dixon J in Cain v Doyle (1946) 72 CLR 409 and which has been approved by the High Court in Jacobsen v Rogers (1995) 182 CLR 572 at 587 (Mason CJ, Deane, Dawson, Toohey and Gaudron JJ); State Authorities Superannuation Board v Commissioner of State Taxation (WA) (1996) 189 CLR 253 at 270 (Brennan CJ, Dawson, Toohey and Gaudron JJ); Telstra Corporation Ltd v Worthing (1999) 197 CLR 61 at [22] (the Court); and Wurridjal v Commonwealth of Australia (2009) 237 CLR 309 at [164] (Gummow and Hayne JJ). At 424, Dixon J said:
There is, I think, the strongest presumption against attaching to a statutory provision a meaning which would amount to an attempt to impose upon the Crown a liability of a criminal nature. It is opposed to all our conceptions, constitutional, legal and historical. Conceptions of this nature are, of course, not immutable and we should beware of giving effect to the strong presumption in their favour in the face of some clear expression of a valid intention to infringe upon them. But we should at least look for quite certain indications that the legislature had adverted to the matter and had advisedly resolved upon so important and serious a course.
13 The State contends that the presumption applies to the imposition of a civil pecuniary penalty upon the Crown. The CFMEU contends that the presumption is confined to the question of whether the Crown may be convicted of a criminal offence.
14 Given that the Cain v Doyle presumption is, as Dixon J said "a rule of interpretation" (at 425) and given the contest between the parties as to whether or not it may be deployed in the interpretive task which the Court is called upon to consider, it is best that I commence my consideration with the question of whether the Cain v Doyle presumption applies in relation to the imposition upon the Crown of a civil pecuniary penalty.
15 The State concedes that the Cain v Doyle presumption is not applicable in relation to all civil remedies which may be imposed upon the Crown. There are observations in Cain v Doyle itself which make that proposition plain: at 419 (Latham CJ) and at 425 (Dixon J). The State says however that the civil remedy of a pecuniary penalty stands in a different position.
16 The State contends that the Cain v Doyle presumption is based on the rationale that absent a clear indication that the legislature has resolved to the contrary, the Crown should not be punished. The State then reasons that the imposition of a civil pecuniary penalty involves punishment and therefore, the State argues, the Cain v Doyle presumption is applicable.
17 The issue in Cain v Doyle concerned whether the Commonwealth could, as an employer, be convicted for an offence against the Re-establishment and Employment Act 1945 (Cth). Dixon J commenced that interpretive task by referring to the presumption the nature of which is identified in the passage quoted above. The first observation to be made about the Cain v Doyle presumption is that it is not an immunity and as Dixon J said "not immutable". The presumption identifies a "rule of interpretation". It provides a starting point for interpreting whether a particular enactment was intended to "impose upon the Crown a liability of a criminal nature". The starting point is that it should be presumed that it is inherently unlikely that, in the ordinary case, Parliament intended to impose criminal liability upon the Crown. That is the rationale at the core of the presumption. As Brennan CJ, Dawson, Toohey and Gaudron JJ said in State Authorities Superannuation Board at 270, the Cain v Doyle presumption is a "presumption based upon the inherent unlikelihood that the legislature should seek to render the Crown liable to a criminal penalty".
18 There were a range of reasons identified in the judgment of Dixon J in Cain v Doyle as to why, in the absence of a clear indication to the contrary, it should be presumed that Parliament did not intend to impose a criminal penalty upon the Crown. What appears to be the central reason relied upon by Dixon J for the existence of the presumption is that the imposition of criminal liability upon the Crown "is opposed to all our conceptions, constitutional, legal and historical" (at 424). That was said in the context of Dixon J's observation (at 425) that he was unaware of any statute which had ever provided a criminal remedy against the Crown itself. Other specific reasons referred to by Dixon J as "only minor considerations" were outlined at 424-425. Some of those were particular to the Act there under consideration and included that no court of summary jurisdiction had jurisdiction over the Crown; the fine imposed upon the Crown would be payable by the Crown; and that the Crown may remit fines.
19 Latham CJ did not expressly rely on a presumption but in the process of interpreting the Act in question, identified a number of reasons why he considered that the Crown was not amenable to a criminal sanction. Those reasons (outlined at 417-419) were:
the application of the rule that "the King can do no wrong" and is thus not liable for a civil or criminal wrong unless made liable by statute;
it has never been suggested that the criminal law binds the Crown;
as the Crown is ordinarily the prosecutor, it would be impossible for the Crown to prosecute the Crown;
the fundamental idea of the criminal law is that "breaches of the law are offences against the King's peace, and it is inconsistent with this principle to hold that the Crown can itself be guilty of a criminal offence"; and
the Crown cannot be imprisoned and there would be little utility in requiring the Crown to pay a fine to itself. Further, the Commonwealth has the power to remit any penalty imposed for a breach of federal law.
20 The common law immunity of the Crown to which Latham CJ referred (in the first reason listed above) was also a matter reflected upon in passing by Weinberg J in McKellar v Container Terminal Management Services (1999) 165 ALR 409. At [224] Weinberg J explained that the "King's unquestioned immunity from prosecution for crime" was based upon "the somewhat arcane legal fiction that the Sovereign was incapable of possessing the requisite mens rea".
21 Weinberg J continued at [225]:
A more modern and less dubious justification for the doctrine is that the Sovereign is immune from punishment, rather than being incapable of committing a crime.
22 Relying upon that observation of Weinberg J, the State submitted that the most modern rationale for the Cain v Doyle immunity is that the Crown is immune from punishment. As the imposition of a civil pecuniary penalty involves punishment, the State argues that there is no material difference in the character of punishment between criminal penalties and civil pecuniary penalties. Those matters, so the State contends, enable the Court to conclude that the principle that the Crown is immune from criminal penalty in the absence of an express statement to the contrary, extends to civil pecuniary penalties under current Commonwealth law. It is contended that the function and effect of criminal and civil penalties are in substance sufficiently the same for the principle to apply to civil penalties of the kind found in s 546 of the FW Act.
23 There are a number of propositions which underpin the conclusion for which the State contends which require closer examination.
24 Contrary to the State's submission, it is not correct to speak of the Cain v Doyle presumption as an "immunity". As I have already observed, it is not an immunity. It is an expression, as Gummow and Hayne JJ observed in Wurridjal v Commonwealth at [164], of "accepted principles of statutory construction" for discerning whether a legislative purpose exists to impose a criminal sanction upon the Crown.
25 Weinberg J in McKellar was dealing with a common law immunity and said nothing directly about the Cain v Doyle presumption. Weinberg J's observation at [224] that immunity from punishment is the justification for the Crown's immunity from "a serious common law offence" does however provide a reason (the Sovereign is not ordinarily punished for a crime), which supports the Cain v Doyle presumption.
26 The parties have not been able to identify and I am not aware of any case in which the Cain v Doyle presumption has been considered or applied in relation to a civil pecuniary penalty. There are however a number of cases (to which I will shortly refer) where, by reference to predecessor provisions to s 546 of the FW Act, this Court has imposed civil pecuniary penalties upon the Crown without the Cain v Doyle presumption being applied and in circumstances where the applicability of that presumption was not raised by the Crown.
27 I am not persuaded that it would be appropriate to extend the application of the Cain v Doyle presumption to civil pecuniary penalties on the basis that punishment is a common feature of both criminal sanctions and civil pecuniary penalties. Reliance upon that commonality is too simplistic a basis for the direct and unqualified extension of the principle. First, very different perceptions and consequences arise in relation to criminal offending than those that attach to a civil contravention. Those differences must be taken into account. Secondly and in relation to the commonality of punishment, what needs to be considered is not punishment per se but the extent of commonality of retributive punishment. The extent to which retributive punishment is an objective for the imposition of a civil pecuniary penalty for a contravention of Part 3-1 of the FW Act differs from the extent to which retributive punishment is an objective of a criminal sanction. As I will explain, those differences make the direct and unqualified extension of the presumption inappropriate. However, the rationale for the Cain v Doyle presumption is nevertheless informative of the approach to be taken to the task of statutory construction.
28 As a rule of construction, the rationale for the Cain v Doyle presumption is that it ought to be assumed that what historical experience and long held conceptions suggest would be an inherently unlikely objective, is not the objective which Parliament has pursued in an enactment. The notion that Parliament intended that the Crown be amenable to conviction and punishment for a crime sits most uncomfortably with what may be described as long held conceptions. In contrast, the same or similar level of discordance does not necessarily arise in relation to the Crown's involvement in a civil contravention.
29 Criminal behaviour is conduct which is morally or socially reprehensible although that formulation does not define what is a crime. Views may differ as to the extent of reprehensibility required. What constitutes a crime is ultimately provided by the law. A crime is what the law (usually through Parliament) has designated to be a crime. That designation is important. It marks conduct out as being sufficiently reprehensible to warrant a high degree of social condemnation and deserving of a criminal sanction. The stigma of a criminal conviction is a stamp of society's disapproval of both the conduct and the person who engaged in it.
30 Other kinds of wrongdoing, including the contravention of a civil penalty provision, stand apart. They are distinguished by the fact that the wrongdoing concerned has not been designated a crime. The conduct will not be regarded as criminal conduct, the wrongdoer will not be branded a criminal and the stigma of a criminal conviction will not be the stamp of society's disapproval.
31 The high degree of moral culpability and social condemnation attached to the commission of a crime, is a powerful distinguishing feature between a crime and a civil contravention in an exercise designed to distil whether or not Parliament intended to impose a sanction of a "criminal nature" upon the Crown. Whilst criminal sanctions and civil pecuniary penalties may share some commonality, the distinction between a crime and a civil contravention remains, in my view, a highly significant factor in the determination of the issue at hand. It is significant because there is an obvious relationship between the character of the wrongdoing as identified by its legal designation and the inherent unlikelihood of Parliament having intended to sanction the Crown.
32 Turning then to the commonality upon which the State relies, the State's contention that civil pecuniary penalties are like criminal sanctions because both involve punishment is correct but of itself not very helpful. Many forms of civil remedies involve an element of punishment, such as the loss of property or the loss of a right, privilege or other benefit. If the existence of punishment in a sanction is sufficient to attract the application of the Cain v Doyle presumption, then the presumption ought be extended to all manner of civil remedies. Nor is the form of punishment determinative. Pecuniary penalties exist as a criminal sanction but may also be imposed administratively and contractually. As Goldberg J observed in Australian Competition and Consumer Commission v Australian Safeway Stores Pty Ltd (1997) 75 FCR 238 at 241, the ordinary dictionary meaning of "penalty" is "a punishment for contravention of law, rule or contract".
33 The word "punishment" may be used to refer to the consequence of a sanction as well as the purpose of a sanction. In examining whether a relevant commonality exists between criminal punishment and the punishment imposed by a civil pecuniary penalty, it is purpose rather than consequence which is relevant to the comparative exercise here being undertaken. But the context in question demands, in my view, further specification of the sense in which "punishment" is to be compared.
34 Spigelman CJ identified in the last sentence of the extract below, the sense of the word "punishment" which it seems to me is germane to the comparison which here needs to be made. At [89] of Rich v Australian Securities and Investment Commission (2003) 203 ALR 671, Spigelman CJ said:
There is an ambiguity, in the sense of inexplicitness, in the use of general terms such as "punitive", "punishment" or "penalty". Each of these words may signify different matters in different contexts. A criminal sentence, for example, is often referred to as a "punishment" or as a "penalty". That is so even though the sentence is to serve a number of disparate objectives including retribution, specific and general deterrence and/or rehabilitation. Another sense of the word "punishment" would be to restrict that term to the retributive element in a sentence.
35 At [4.3] of the Australian Law Reform Commission's report, Same Crime, Same Time, Report No 103 (2006), the ALRC observed that retribution is often referred to as "punishment" in legislation and case law. At [4.4] the ALRC identified retribution as being based on the belief that those who engage in criminal activity deserve to suffer. However the biblical 'eye for an eye' justification for retributive punishment has been overtaken by the modern form of retribution. In the modern cases, the word retribution is generally used in the sense of the infliction of a just punishment to express the moral outrage of the community: R v Valentini (1980) 2 A Crim R 170 at 174 (Bowen CJ, Muirhead and Evatt JJ).
36 Retribution may not be the exclusive domain of a criminal sanction, the imposition of punitive damages has a retributive objective, but retribution is a hallmark of criminal punishment. The infliction of punishment on the Crown, as an expression of community outrage for conduct sufficiently morally or socially reprehensible to have been designated as criminal conduct, tends to offend long held conceptions about the status of the Crown and the extent to which the laws and the courts may impinge upon its special position as a non-subject. It is for that reason that it may be presumed that it is inherently unlikely that Parliament would intend to impose retributive punishment upon the Crown for the commission of a crime.
37 In contrast, when the aim or objective of the imposition of a statutory sanction is utilitarian or functional such as the objective of deterrence, the application of that aim to the activities of the Crown is not inherently abhorrent to legitimate expectations about the extent to which Parliament intended that the sanction apply to the Crown. That is particularly so when the conduct involved is not criminal but liable only to a civil sanction and when recognition is given to the contemporary role of the Crown. As the High Court recognised in Bropho v Western Australia (1990) 171 CLR 1 at 19 (Mason CJ, Deane, Dawson, Toohey, Gaudron and McHugh JJ), the activities of the Crown in contemporary Australia "reach into almost all aspects of commercial, industrial and developmental endeavour and…it is a commonplace for governmental commercial, industrial and developmental instrumentalities and their servants and agents...to compete and have commercial dealings on the same basis as private enterprise".
38 A wide range of statutory regimes exist in Australia which are designed to protect public welfare across a range of subject matters from occupational health and safety to the protection of the environment to fair trade and competition. It is commonly the case that these schemes bind the Crown in relation at least to their commercial, industrial and developmental endeavours. It is commonly the case that civil sanctions are utilised to enforce compliance. That Parliament would seek to impose effective statutory sanctions to deter wrongdoing and thereby prevent further wrongdoing by all persons whose activities are regulated, is unsurprising. That motivation suggests an intent that the Crown be treated the same as any other person who is the subject of the regulation. Such an intent is supported by the principle of equality before the law. An expression of that principle was articulated by Gibbs CJ (with whom the other members of the Court agreed) in Townsville Hospitals Board v Townsville City Council (1982) 149 CLR 282. In construing the applicability of a legislative scheme to a public sector statutory corporation, Gibbs CJ said at 291:
All persons should prima face be regarded as equal before the law, and no statutory body should be accorded special privileges and immunities unless it clearly appears that it was the intention of the legislature to confer them.
39 The difficulty is that sanctions are often motivated by a mix of objectives and attempts at classification are likely to be unstable because the drawing of mutually exclusive distinctions are likely to prove elusive. That is because there will likely be an overlap of objectives for the imposition of a sanction as explained in Rich v Australian Securities and Investment Commission (2004) 220 CLR 129 at [32] and [35] (Gleeson CJ, Gummow, Hayne, Callinan and Heydon JJ).
40 In its report entitled Principled Regulation: Federal, Civil and Administrative Penalties in Australia, Report No 95 (2003), the Australian Law Reform Commission identified and considered the different objectives for the imposition of a penalty. It did so in the context of identifying differences between the imposition of criminal and civil penalties.
41 At [3.5] of that report, the ALRC characterised the possible objectives of the imposition of a penalty as:
retribution ('just deserts' for having committed the contravention);
social condemnation (expressed through the stigma of a criminal record or severe penalty such as imprisonment);
specific deterrence (deterrence of the person sanctioned from repeating the contravention);
general deterrence (deterrence of others from engaging in the prohibited behaviour);
protection of third parties or the public at large; and
payment of reparation or compensation.
42 As the ALRC observed at [3.6], more than one of these aims is usually present in any particular penalty. Nevertheless, the ALRC considered that social condemnation and retribution had a more dominant role to play in relation to the imposition of a criminal penalty than in relation to a civil penalty. As the ALRC said at [3.6]:
The aim of social condemnation, or stigma, traditionally applies to criminal penalties, and remains one important criterion for distinguishing between criminal and non-criminal penalties. The remaining aims apply both to civil and criminal regulatory penalties but retribution plays a less important role in civil penalties than in criminal ones.
43 Observations to a similar effect were made by French J in Trade Practices Commission v CSR Limited (1991) ATPR 41-076. That case was concerned with a contravention of s 46 of the former Trade Practices Act 1974 (Cth) (now the Competition and Consumer Act 2010 (Cth)). The section was directed to procuring and maintaining competition in trade and commerce.
44 French J considered that moral or amoral components of a contravener's behaviour in a contravention of s 46 had no part to play in determining the appropriate sanction and that this conclusion reflected the purpose of the pecuniary penalties imposed for restrictive trade practices under s 76. At 52,152 his Honour said:
Punishment for breaches of the criminal law traditionally involves three elements: deterrence, both general and individual, retribution and rehabilitation. Neither retribution nor rehabilitation, within the sense of the Old and New Testament moralities that imbue much of our criminal law, have any part to play in economic regulation of the kind contemplated by Pt IV. Nor, if it be necessary to say so, is there any compensatory element in the penalty fixing process - Trade Practices Commission v Mobil Oil Australia Ltd (1984) 4 FCR 296 at 298 (Toohey J). The principal, and I think probably the only, object of the penalties imposed by s 76 is to attempt to put a price on contravention that is sufficiently high to deter repetition by the contravenor and by others who might be tempted to contravene the Act.
45 Those observations of French J, as Goldberg J noted in Safeway Stores at 241-242 may have influenced the view of the majority in NW Frozen Foods Pty Ltd v Australian Competition and Consumer Commission (1996) 71 FCR 285 at 296-297 where Burchett and Kiefel JJ said:
But the penalties imposed by s 76 are, as we have said, not criminal sanctions, and their purpose, established now by a long line of cases, is not punishment.
The third member of that Full Court, Carr J, preferred to leave that question open (at 299). The issue was also left unresolved by a Full Court in Australian Competition and Consumer Commission v Ithaca Ice Works Pty Ltd [2001] FCA 1716 at [50] (Wilcox, Hill and Carr JJ) and in J McPhee and Son (Australia) Pty Ltd v Australian Competition and Consumer Commission (2000) 172 ALR 532 at [170] (Black CJ, Lee and Goldberg JJ).
46 In Safeway Stores, Goldberg J said that he had difficulty with the proposition that the fixing of a penalty for a contravention of a statutory provision such as that found in Part IV of the Trade Practices Act should not be regarded as a punishment (at 242). In Australian Competition and Consumer Commission v SIP Australia Pty Ltd [2003] FCA 336, Goldberg J at [24] referred to what he termed "an unresolved issue as to whether the element of punishment has a role in the imposition of a penalty pursuant to s 76".
47 Whilst there may be differing views about whether retributive punishment is a relevant consideration for the imposition of a civil pecuniary penalty under the Competition and Consumer Act, each of the authorities to which I have referred have made it abundantly clear that the object or primary object of the imposition of a penalty under that Act and its predecessor is specific and general deterrence: see Safeway Stores at 240; SIP Australia at [22] and the authorities there cited; and Australian Competition and Consumer Commission v Hire Adventure Pty Ltd [2005] FCAFC 247 at [11], where the Full Court described deterrence (especially general deterrence) as "the primary purpose lying behind the penalty regime".
48 The availability of retributive punishment as an aim for the imposition of a civil penalty under the Corporations Act 2001 (Cth) is well accepted. In Australian Securities and Investments Commission v Adler [2002] NSWSC 483 at [125] Santow J observed that "It is well established that the principal purpose of a pecuniary penalty is to act as a personal deterrent and a deterrent to the general public against a repetition of like conduct". At [126] his Honour acknowledged that the pecuniary penalty "has a punitive character". That observation is consistent with an earlier observation made by Cooper J in Australian Securities Commission v Donovan (1998) 28 ACSR 583 at 608 where his Honour said that the purpose of the pecuniary penalty was "in an appropriate case…to punish, but principally imposition of a pecuniary penalty is to act as a personal deterrent or a deterrent to the general public against a repetition of like conduct".
49 In Rich v Australian Securities and Investment Commission (2004) 220 CLR 129, McHugh J explained that a disqualification order made against a director may be imposed not only for protective purposes but also by way of punishment (at [41]-[42]). In Australian Securities and Investments Commission v Vizard (2005) 145 FCR 57, Finkelstein J dealt with civil contraventions of the Corporations Law (Cth) relating to the improper use by a director of information to gain an advantage contrary to ss 183 and 232 of that Act. At [29], Finkelstein J characterised a breach of those provisions as carrying with it "a significant degree of moral blameworthiness…because a contravention involves a serious breach of trust". His Honour continued at [30]:
It is appropriate now to make mention of the principles that underlie sentencing, being principles that also guide the determination of civil penalties. This is not the occasion upon which to discuss in any detail the four concepts that inform sentencing: general deterrence and personal deterrence (where punishment is imposed to avert future harm), and rehabilitation and retribution (where punishment is imposed simply because the offender deserves it). It is important, however, to make this point. For most offences (and contraventions of ss 232(5) and 183(1) are no exception) the punishment imposed by the Court is the means by which society expresses its moral condemnation of the offender. It also affirms that the particular law is worthy of obedience. If the punishment is unduly lenient there is the risk that the Court will be perceived as endorsing the offender's conduct.
50 At [33], Finkelstein J observed that "While retribution is important as a stamp of society's disapproval of particular conduct, the governing principle of 'sentencing' in cases of the kind with which we are concerned is general deterrence".
51 The extent to which the purpose of the penalty regime provided by the FW Act is retributive, has not been the subject of any close consideration.
52 Broadly speaking, the FW Act establishes a scheme for regulating workplace relations between employers and their employees. It provides for minimum terms and conditions of employment (the "National Employment Standards") which an employer must provide its employees. It provides regimes for the making and enforcement of 'modern awards', 'enterprise agreements' and 'workplace determinations' which are intended to specify additional terms and conditions of employment and regulate other aspects of relations between an employer and its employees.
53 Relevantly to the contraventions to which this proceeding relates, the FW Act also regulates industrial behaviour including by conferring workplace rights and imposing responsibilities upon employers, employees, industrial organisations and other persons. The rights protected by Part 3-1 include fundamental human rights such as the right to freedom of association. The objects of Part 3-1, as specified by s 336, are to protect workplace rights including freedom of association, to provide protection from workplace discrimination and to provide effective relief for persons who have been discriminated against, victimised or otherwise adversely affected as a result of contraventions of the Part.
54 Part 3-1 establishes behavioural norms which the legislature has sought to secure through a regulatory scheme dealing with both individual rights and public welfare. The legislature has sought to secure the objectives of that scheme including through the device of civil sanctions. The primary objective of those sanctions is functional. It is to deter proscribed conduct by placing a cost upon the contravener and thereby deterring both the contravener and others from future contravention. So much was recognised in Plancor Pty Ltd v Liquor, Hospitality and Miscellaneous Union (2008) 171 FCR 357, by Branson and Lander JJ at [70] who endorsed the view expressed by Greenwood J in McIlwain v Ramsey Food Packaging Pty Ltd (No 4) (2006) 158 IR 181 at [108] that the imposition of a penalty (under the WR Act) was "designed fundamentally to serve the public interest in acting as a deterrent to the particular Respondents and others generally" from engaging in contravening conduct: see also Plancor at [37] (Gray J); Draffin v Construction, Forestry, Mining and Energy Union (2009) 189 IR 145 at [89] (Goldberg, Jacobson and Tracey JJ); Finance Sector Union of Australia v Commonwealth Bank of Australia (2005) 147 IR 462 at [41] and [60] (Merkel J); and Community and Public Sector Union v Telstra Corporation Limited (2001) 108 IR 228 at [8]-[9] (Finkelstein J).
55 Subject to the reach of Commonwealth constitutional power, the FW Act is an Act of general application. It binds the vast majority of employers and employees in Australia including "the Crown in each of its capacities" (s 37(1)). The Crown in right of the Commonwealth is undoubtedly Australia's largest employer of employees. Each of Australia's States and Territories are very substantial employers.
56 There is no indication in the FW Act that in its capacity as an employer or as a person otherwise bound by Part 3-1, the FW Act seeks to treat the Crown differentially to other persons. The Crown in right of the Commonwealth is a 'constitutional covered entity' (s 338(2)(b)) and is subject to Part 3-1. Sections 30G(1) and 30R(1) provide that Part 3-1 applies to action taken in a 'referring State'. There is no indication that the conduct of the Crown is not subject to the behavioural norms set by Part 3-1 and insofar as civil sanctions seek to promote compliance with those behavioural norms, there is no basis for supposing that securing the intended behavioural norms from the Crown was not intended as part of the regulatory scheme.
57 Nevertheless, retributive punishment seems to me to be an available objective for the imposition of civil pecuniary penalties for a contravention of Part 3-1. Whilst a contravention of Part 3-1 is not conduct that is likely to attract the odium of criminality, it is conduct that is capable of being regarded as socially reprehensible and deserving of retributive punishment. The workplace rights protected by Part 3-1 are important rights, the loss of which can lead to severe disadvantage to individuals and serious social disruption. A contravention of Part 3-1, particularly where deliberateness, defiance or wilfulness is involved, may well require a response involving retributive punishment.
58 A number of authorities have recognised that retributive punishment is an available objective for imposing a penalty for a contravention of the FW Act, its predecessors and also similar legislation such as the Building and Construction Industry Improvement Act 2005 (Cth).
59 In Ponzio v B & P Caelli Constructions (2007) 158 FCR 543 at [93], Lander J speaking generally, but addressing the correctness of the primary judge's decision not to impose a pecuniary penalty under the WR Act, said:
There are three purposes at least for imposing a penalty: punishment; deterrence; and rehabilitation.
60 That Lander J had retributive punishment in mind is apparent from the sentence which followed, where Lander J said:
The punishment must be proportionate to the offence and in accordance with the prevailing standards of punishment: R v Hunter (1984) 36 SASR 101 at 103. Therefore the circumstances of the offence or contravention are especially important.
61 That observation of Lander J has been followed in a number of other cases including Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union [2011] FCA 810 at [26] (Gilmour J); Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union v Visy Packaging Pty Ltd (No 4) [2013] FCA 930 at [16] (Murphy J); and Director of the Fair Work Building Industry Inspectorate v Abbott (No 6) [2013] FCA 942 at [16] (Gilmour J). Observations have often been made in the cases that flagrant, wilful or deliberate conduct is deserving of a higher penalty: see for example Australian Federation of Air Pilots v Skywest Airlines Pty Ltd (1996) 70 IR 284 at 286 (Marshall J); and Abbott (No 6) at [28] (Gilmour J).
62 Most of the authorities that have considered the imposition of a penalty under the FW Act and its predecessors have done so by reference to a list of general (but not exclusive) considerations. An early 'list' was formulated by Branson J in Construction, Forestry, Mining and Energy Union v Coal and Allied Operations Pty Ltd (No 2) (1999) 94 IR 231 at [7]-[8]. The observations of Branson J were made in relation to s 298U of the Workplace Relations Act 1996 (Cth) ("the WR Act"), a provision by which civil pecuniary penalties were imposed for contraventions of Part XA of the WR Act, which contained many of the predecessor provisions now set out in Part 3-1 of the FW Act.
63 As Merkel J noted in Finance Sector Union v Commonwealth Bank at [24] the observations of Branson J have been cited and applied in relation to penalties under s 298U and other sections of the WR Act. Those observations, which Merkel J himself applied, were as follows:
The Act gives no explicit guidance as to the circumstances in which an order imposing a penalty under s 298U of the Act will be appropriate or as to the circumstances in which a penalty of or near the maximum, or alternatively of a lesser amount, may be called for. The Court is simply directed to consider what is appropriate in all the circumstances of the case.
The following matters, which are not intended to comprise an exhaustive list, seem to me to be considerations to which the Court may appropriately have regard in determining whether particular conduct calls for the imposition of a penalty, and assuming that it does, the amount of the penalty:
(a) The circumstances in which the relevant conduct took place (including whether the conduct was undertaken in deliberate defiance or disregard of the Act);
(b) Whether the respondent has previously been found to have engaged in conduct in contravention of Pt XA of the Act;
(c) Where more than one contravention of Pt XA is involved, whether the various contraventions are properly seen as distinct or whether they arise out of the one course of conduct;
(d) The consequences of the conduct found to be in contravention of Pt XA of the Act;
(e) The need, in the circumstances, for the protection of industrial freedom of association; and
(f) The need, in the circumstances, for deterrence.
64 A more recent 'list' of relevant factors which has very often been applied by other judges of this Court in relation to the fixing of penalties under the Building and Construction Industry Improvement Act 2005 (Cth) and the FW Act and its predecessors is that formulated by Tracey J in Kelly v Fitzpatrick (2007) 166 IR 14 and restated by Tracey J in Stuart-Mahoney v Construction, Forestry, Mining and Energy Union (2008) 177 IR 61 at [40].
65 That list, as Tracey J acknowledged at [39] and [40] of Stuart-Mahoney was derived from a number of judgments dealing with the Trade Practices Act and from the judgment of Branson J in Coal and Allied Operations. The non-exhaustive relevant factors identified by Tracey J are:
• The nature and extent of the conduct which led to the breaches.
• The circumstances in which that relevant conduct took place.
• The nature and extent of any loss or damage sustained as a result of the breaches.
• Whether there had been similar previous conduct by the respondent.
• Whether the breaches were properly distinct or arose out of the one course of conduct.
• The size of the business enterprise involved.
• Whether or not the breaches were deliberate.
• Whether senior management was involved in the breaches.
• Whether the party committing the breach had exhibited contrition.
• Whether the party committing the breach had taken corrective action.
• Whether the party committing the breach had cooperated with the enforcement authorities.
• The need to ensure compliance with minimum standards by provision of an effective means for investigation and enforcement of employee entitlements.
• The need for specific and general deterrence.
66 The use of 'lists' of this kind has been the subject of some criticism: Plancor at [35] (Gray J) and at [58] (Branson and Lander JJ); and Australian Ophthalmic Supplies Pty Ltd v McAlary-Smith (2008) 165 FCR 560 at [91] (Buchanan J); see also McDonald v Australian Building and Construction Commissioner (2011) 202 IR 467 at [30] (North, McKerracher and Jagot JJ). Their deployment tends to mask the extent to which retributive punishment is an aim of the sanction. A number of considerations on the 'list' including the nature and extent of the conduct, the circumstances in which it took place and the deliberateness of the conduct are, it seems to me, directed at least in part to retribution.
67 Nevertheless as I have sought to explain, the principal objective for the imposition of a penalty for a breach of Part 3-1 is deterrence. Other features of the penalty regime support that functional objective including that penalties can be sued for by affected employees, employers, unions or other persons identified in column 2 of the table in s 539(2) and that any penalty imposed can be and is ordinarily ordered to be paid to such a person in their role as a common informer: s 546(3); Plancor at [39] and [41]-[44] (Gray J); and Finance Sector Union v Commonwealth Bank at [65]-[71] (Merkel J). The existence of deterrence as the primary objective does not suggest that Parliament was unlikely to intend to make the Crown amenable to a penalty. To the contrary, the significant participatory role of the Crown in the activities regulated by the FW Act and Parliament's obvious intent to put in place an effective regulatory scheme, suggests the opposite. The availability of retributive punishment as an objective for the imposition of a penalty militates in the opposite direction. In that regard the rationale for the Cain v Doyle presumption is informative with the qualification that the conduct being addressed is civil and not criminal.
68 In the task of construing whether Parliament intended that the Crown should be amenable to the imposition of a penalty for a contravention of Part 3-1, each of those considerations should be taken into account. When the availability of retributive punishment is taken into account it should be recognised that though available, retributive punishment is unlikely to be imposed upon the Crown other than in extraordinary circumstances. It will rarely be necessary to provide redress for the moral outrage of the community, which retributive punishment serves to address, in relation to the conduct of the Crown. The Crown acts in furtherance of the public interest rather than any personal interest. Any unlawful conduct taken on behalf of the Crown is likely to be well intentioned but misguided rather than so reprehensible as to be deserving of the community's moral and social condemnation.
69 Nevertheless, in terms of the relative strength of the two considerations I have identified, I consider that on their own those two competing considerations are finely balanced. However, there are other indicators of Parliament's intent which, in my view, strongly negate the effect of the availability of retributive punishment as an objective for the imposition of a civil pecuniary penalty for a contravention of Part 3-1.
70 In Cain v Doyle at 426 Dixon J adverted to an important indicator of Parliamentary intent in the following passage:
At all events, where it is uncertain whether the legislature adverted to the special position of the Crown, it is the very case in which the presumptive rule of interpretation should prevail and the application of the penalty clause should be restricted to the subject to the exclusion of the Crown.
71 The FW Act is not legislation in relation to which it may be said that there is uncertainty as to whether Parliament adverted to the special position of the Crown. In that regard it is worth repeating the terms of s 37:
(1) This Act binds the Crown in each of its capacities.
(2) However, this Act does not make the Crown liable to be prosecuted for an offence.
72 The liability of the Crown to be sanctioned is expressly addressed by the terms of s 37 and has been limited by reference to the special position of the Crown. The word "however" and the qualification which follows it in s 37(2) shows that Parliament turned its mind to the extent of the limitation intended. Section 37(2) reflects the presumed intent of Parliament as articulated by the Cain v Doyle presumption. There can be no doubt that the special position of the Crown was adverted to. The fact that when doing so, Parliament did not impose a limitation upon the Crown's exposure to a civil pecuniary penalty is a strong indicator that Parliament did not intend such a limitation. Section 37 should not be regarded as being silent as to whether the Crown is amenable to a pecuniary penalty because the extent to which Parliament sought to qualify the amenability of the Crown to the full force of the FW Act is expressly addressed. That conclusion is reinforced by the declaration made in s 549 that a contravention of a civil remedy provision is not an offence. It is also supported by authority.
73 In Coochey v Commonwealth (2005) 149 FCR 312, Madgwick J imposed a pecuniary penalty upon the Commonwealth for a contravention of the WR Act. The contravention in question was a breach of a certified agreement which bound the Commonwealth in its capacity as an employer. Section 6 of the WR Act was in the same terms of s 37 of the FW Act. Referring to s 6(2) of the WR Act, Madgwick J said at [64]:
The terms of subs (2) appear to underline that the Commonwealth might be sued for a penalty.
74 The other decision in which a civil pecuniary penalty has been imposed upon the Crown for breaches of Commonwealth industrial relations legislation is Community and Public Sector Union v Commonwealth of Australia (2007) 168 IR 107. In that case, Branson J found that the Commonwealth had contravened s 298K(1) of the WR Act (a predecessor provision to the current s 340) and was involved in further contraventions of that Act by reason of the breach of industrial instruments to which the Commonwealth was a party. The penalty phase of the proceeding was determined by reference to an agreed minute from the parties as to the declarations to be made and written submissions as to penalty. At [3], Branson J indicated her preparedness to make a declaration in the form proposed by the parties, save that her Honour declined to include a statement to the effect that the Commonwealth is liable to have a penalty or penalties imposed on it. Her Honour declined to do so on the basis that she saw "no utility in making a declaration as to the plain effect of the WR Act". Although Branson J did not refer to s 6 of the WR Act, it is likely that her reference to the "plain effect" of the WR Act was a reference to that provision.
75 It is necessary then to consider the terms of s 546(2) and the State's contention that s 546(2) exhaustively identifies those persons who are amenable to a pecuniary penalty and does not provide that the State is amenable, because the State is neither "an individual" nor "a body corporate". The State's contention is based on the proposition that although the Crown is a person capable of being found to have contravened a civil remedy provision, the terms of s 546(2) deliberately exclude the Crown from the description of persons upon which penalties may be imposed.
76 In my view, if Parliament held that intent, it is unlikely that it would not have been earlier expressed in the statute. The most obvious place to have given expression to such an intent is s 37 where the subject matter of the Crown's amenability to the full force of the FW Act is specifically addressed. For reasons I have already indicated, the manner in which that subject matter is addressed strongly suggests the opposite intent to that which the State seeks to attribute to Parliament. If the State's contention is correct, s 37 is to be read down by reference to s 546(2).
77 It is s 546(1) which gives an eligible court the power to impose a pecuniary penalty upon a person who has contravened a civil remedy provision. If that power was to be restricted to exclude the Crown, the next most obvious place to have done so would have been in s 546(1) because that provision deals directly with the issue of who may be the subject of a pecuniary penalty. There is no restriction to be found in the words of s 546(1). The provision confers a power to order "a person" to pay a pecuniary penalty where the Court is satisfied that "the person" has contravened a civil remedy provision. Section 22(1)(a) (now s 2C(1)) of the Acts Interpretation Act (set out above) provides that unless the contrary intention appears, "person" includes "a body politic or corporate".
78 The State contends that a contrary intention appears so as to exclude the Crown from the expression "a person". For the State's contention regarding s 546(1) to be correct, s 546(1) needs to be read down by reference to s 546(2).
79 Section 546(2) does not deal directly with the question of which contraveners are amenable to a penalty. Its direct subject matter is the maximum penalty that may be imposed on particular contraveners.
80 On the State's approach to construction, the tail seems to be wagging the dog. Rather than working backwards from s 546(2), an alternative approach to construction would be to interpret s 546(2) by reference to the intent found in s 37 and s 546(1). However the preferable course to take to the task of construction is to consider all of the indicators of Parliamentary intent together, ascribing the appropriate weight to each indicator. In doing so it is permissible to assume Parliament's intent has been rationally ordered and expressed by the draftsperson and that it is most likely that an expression of intent on a particular subject matter will have been dealt with directly in provisions addressing that subject, rather than indirectly in a provision on a related subject.
81 In my view, the positive indicators of Parliament's intent that the Crown is amenable to a pecuniary penalty found in s 37 and s 546(1), outweigh any contrary indication found in s 546(2). I will address the contrary indicator in more detail shortly. But there are other positive indicators of Parliament's intent which reinforce my conclusion.
82 First, if it was intended that the Crown be shielded from exposure to a pecuniary penalty, it is difficult to reconcile why the Crown in all of its manifestations is not shielded. The State accepted that its construction of s 546(1) and (2) results in some parts of the Crown, namely statutory corporations representing the Crown, being amenable to a civil penalty. Those corporations are bodies corporate and there is no issue that s 546(2)(b) would apply. Why Parliament should have intended such a result is not apparent.
83 Overwhelmingly, it is conduct taken in the capacity of an employer that it is capable of exposing the Crown or its agencies to contravention of a civil remedy provision under the FW Act. Public sector employees may not be directly employed by the Crown. Often they are employed by a statutory corporation representing the Crown or by individuals designated by statute to be their employer on behalf of the Crown. An example of the latter is provided by s 20 of the Public Administration Act 2004 (Vic) which designates "a public service body Head" to have all of the rights, powers, authorities and duties of an employer in respect of the employees in the Department or public service body which that person is charged to manage. A Minister may also be the subject of such a designation in respect of the public servants in the Department assigned to the Minister. That was the position in Tasmania in relation to the employment of government school teachers as Heerey J recorded in Frearson v Minister for Public Sector Management (Tas) (1998) 82 IR 211. In Frearson Heerey J applied a predecessor provision to s 546(2) (s 178(4)(a) of the WR Act) to impose a penalty on the relevant Minister as an individual (at 216).
84 On the State's construction, the exposure of the State as an employer to a penalty for contravention of the FW Act, will depend upon whether or not the State has chosen to directly employ public employees. The same peculiarity will apply across the whole range of Crown activities.
85 The State suggested that this position may be explained by the special position of the Crown itself which is reflected in the Cain v Doyle presumption. However it does not follow that when Parliament creates an agent of the Crown, whether by a public corporation or by an office held by a natural person, that the agent does not possess the attributes of the Crown including its privileges and immunities. That may or may not be the case. Much depends upon the terms of the governing statute by which the Crown agent has been established: Inglis v Commonwealth Trading Bank of Australia (1969) 119 CLR 334 at 337-338 (Kitto J, with whom Barwick CJ and Windeyer J agreed); Townsville Hospitals Board v Townsville City Council at 289 (Gibbs CJ, with whom Murphy, Wilson and Brennan JJ agreed); NT Power Generation Pty Ltd v Power and Water Authority (2002) 122 FCR 399 at [79]-[80] (Branson J) and [126] (Finkelstein J); see also s 46A Interpretation of Legislation Act 1984 (Vic).
86 If the draftsperson had sought to shield from exposure to a penalty all of the limbs of the Crown entitled (on the State's case) to the benefit of the Cain v Doyle presumption, the draftsperson would not have chosen the incorporation of a limb of the Crown as the discriminating characteristic for determining whether or not an aspect of the Crown was exposed to a penalty. The draftsperson would most likely have chosen the characteristic utilised by s 37(2) where an immunity is provided to the Crown which necessarily extends to all of its statutory corporations and other agents entitled to the privileges and immunities of the Crown. That analysis serves to reinforce the contention that if there was an intent to shield the Crown from exposure to a penalty, that intent would have been made plain by the terms of s 37(2) rather than indirectly and imperfectly by the terms of s 546(2).
87 Secondly, the legislative history does not support the State's contention. Part 3-1 contains what have traditionally been referred to as the 'freedom of association' provisions in Commonwealth industrial legislation. The name emanates from the title to Part XA of the WR Act enacted in 1996, although provisions protecting freedom of association were part of Commonwealth industrial legislation going back to the enactment of the Conciliation and Arbitration Act 1904 (Cth) ("the C&A Act").
88 The enactment of the WR Act first exposed a contravener of the freedom of association provisions to civil pecuniary penalties. Prior to that point, the freedom of association provisions contained in the C&A Act and later the Industrial Relations Act 1988 (Cth) ("the IR Act") were criminal offences. For that reason the historical survey should begin with the WR Act.
89 As earlier observed, s 6 of the WR Act was in the same terms as s 37 of the FW Act. Section 298X provided that a contravention of Part XA was not an offence. Remedies for a breach of Part XA of the WR Act were dealt with in that Part. Section 298U empowered this Court to impose (amongst other orders) a penalty upon a person whose conduct contravened a provision of Part XA of not more than:
(i) in the case of a body corporate - $10,000; or
(ii) in any other case - $2,000.
90 Substantial amendments were made to the WR Act by the Workplace Relations Amendment (WorkChoices) Act 2005 ("the WorkChoices amendments"). Following those amendments and consequent upon further renumbering, s 807 of the WR Act dealt with the imposition of civil pecuniary penalties in relation to a contravention of the freedom of association provisions, which at that time were contained in Part 16. Section 10 of the WR Act (post the WorkChoices amendments) was in the same terms as s 37 of the FW Act. Each of the relevant provisions of Part 16 capable of giving rise to a contravention were identified as civil remedy provisions. Section 807 empowered the Court to make orders including an order imposing a pecuniary penalty on "a person" who had contravened a civil remedy provision in Part 16. Section 807(2) provided:
(2) The maximum pecuniary penalty under paragraph (1)(a) is 300 penalty units if the defendant is a body corporate and otherwise 60 penalty units.
(Emphasis added.)
91 The legislative history shows that in relation to a contravention of Part 3-1 and its predecessor civil remedy provisions, each of s 37 and its predecessors and s 546(1) and its predecessors remained constant and were unchanged so far as indication is there given as to Parliament's intent to expose the Crown to a penalty. The only relevant change which has occurred with the introduction of the FW Act, is in relation to s 546(2) where the category of "body corporate" continues to appear, but where "other cases" or "otherwise" no longer appear and the category of "an individual" first appears.
92 The State has no answer to the proposition that the categories of "other cases" or "otherwise" were capable of encompassing a body politic such as the State. The other relevant indicators of Parliament's intent as to whether the Crown was amenable to a penalty under the WR Act (either pre or post the WorkChoices amendments) which may be gleaned from the predecessors of s 37 and s 546(1), are consistent with the positive indication which I have identified in relation to the current provisions. The State has not sought to suggest that other provisions of the WR Act absolved the Crown from liability for a penalty for a contravention of the freedom of association provisions and I have not been able to identify any.
93 It seems then that the Crown was amenable to the imposition of a pecuniary penalty for a contravention of the predecessor provisions of Part 3-1 from 1996 when such penalties were first introduced until at least 2009 when the FW Act was enacted. It is difficult to accept that the Crown gained an immunity that it did not enjoy under the previous statutory regime in the absence of any indication of such a significant change in the Explanatory Memorandum or elsewhere. It is particularly difficult to accept that to effectuate such a significant change, the draftsperson chose the imperfect mechanism of s 546(2) rather than the obvious step of adding a further qualification to s 37(1) in s 37(2).
94 Turning then to the State's reliance upon s 546(2), the State's position is based upon the contention that the term "body corporate" does not encompass the Crown. That contention is put by reference to the ordinary meaning of "body corporate" and is said to be illustratively reinforced by the disjunctive "or" between "body politic" and "[body] corporate" in s 22(1)(a) of the Acts Interpretation Act.
95 I accept that ordinarily, the Commonwealth and each of the various States and Territories are more likely to be described as a "body politic" rather than a "body corporate". However, there are three possible explanations, beyond that relied upon by the State, which if correct, support the rejection of the statutory intent contended for by the State by reference to the terms of s 546(2). They are:
(i) a maximum penalty for a contravention by the Crown is elsewhere provided for in the FW Act;
(ii) the expression "body corporate" in this instance was intended to encompass body politic; or
(iii) no maximum penalty for a contravention by the Crown has been provided for.
96 The first possibility is to be rejected. It is based on the idea that column 4 of the table in s 539(2) sets out, by way of a general provision, the maximum penalty to be imposed on a contravener and that s 546(2) is a specific provision which applies "if the person" is of the type there dealt with. On that construction, if the State is not a "body corporate" and is not dealt with by the specific provision, it is nevertheless dealt with by the general provision.
97 There are two difficulties with that construction which justify its rejection. The first is that the text of s 539(2) which introduces the table refers to the maximum penalties listed in column 4 as the maximum penalties which may be applied for. The setting of a maximum penalty is there dealt with in indirect terms which suggests that column 4 was intended to be no more than a convenient reference point in which all of the various maximum penalties are collected. That function is confirmed by the text of s 546(2) which uses the table for that purpose.
98 The second and perhaps more telling basis for rejecting this construction is that if the table was intended to be a general provision which substantively set (rather than merely listed) the maximum applicable penalties, there would be no reason for the inclusion of s 546(2)(a). That paragraph would be entirely unnecessary because the maximum penalties there set would only repeat those set in the table. If the table was intended as a substantive general provision, the intended maximum penalty for "an individual" would have been left to be addressed by the table. That analysis suggests that s 546(2) is not a provision qualifying a general provision for specific categories of contraveners but is the only provision which substantively sets the applicable maximum penalties which may be imposed.
99 The Commonwealth and the various States and Territories are often described by the term "body politic". The State referred to a number of judgments where that descriptor was applied including Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334 at [22]-[23] (Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ); Wurridjal v Commonwealth at [164] (Gummow and Hayne JJ); Sue v Hill (1999) 199 CLR 462 at [84]-[85] (Gleeson CJ, Gummow and Hayne JJ); Re Patterson; Ex parte Taylor (2001) 207 CLR 391 at [13] (Gleeson J); and Williams v Commonwealth of Australia (2012) 288 ALR 410 at [154] (Gummow and Bell JJ) and at [495] and [500] (Crennan J).
100 The judgments referred to exemplify the common use of "body politic" to describe the Commonwealth and each of the various States or Territories. They are helpful in support of the proposition, which I accept, that "body politic" rather than "body corporate" is ordinarily used to describe the Crown. However, those authorities do not directly address the appropriateness of the use of the term "body corporate" to describe the Crown. It may be that what was said by Gummow and Hayne JJ at [164] of Wurridjal was intended to address a distinction between "body corporate" and "body politic" but that is not clear. If that was the intent then the observation there made only suggests that their Honours regarded the reference to "body corporate" in the legislation there under consideration, was not the "clearest indication" of an intention to refer to the Commonwealth. The authorities relied upon do not provide a basis for distinguishing Coochey, as the State contends.
101 The issue for determination in Coochey was whether, for the purpose of the imposition of a pecuniary penalty under the WR Act, the Commonwealth fell into the category of "body corporate" or "other cases". The Commonwealth contended that it was in the second category and thus liable to the lower maximum penalty provided for by s 178(4). The Commonwealth referred to and relied upon the distinction drawn in s 22(1)(a) of the Acts Interpretation Act between a "body corporate" and a "body politic".
102 Whilst Madgwick J accepted at [59] that the Commonwealth was "undoubtedly" a body politic, he went on to reject the Commonwealth's contention that it was not also a "body corporate" within the meaning of s 178(4) of the WR Act. Madgwick J considered that the provisions of the Constitution created the Commonwealth as a body of people which may be sued as such and that, at least for the purposes of s 178, the Commonwealth was a "body corporate" (at [66]). His Honour thought it "entirely consistent with s 6" (the equivalent of s 37 of the FW Act) to regard "body corporate" as "including entities with a governmental character, provided they also have the necessary corporate character" (at [67]).
103 Madgwick J considered that the governmental character of a body did not deny its character as a body corporate. He said at [67]:
As a matter of ordinary language and legal possibility, a body politic may also be a body corporate or be equated to such: they are not mutually exclusive categories. A body corporate may have a governmental character: various types of local government bodies both here and elsewhere in countries of the common law tradition are examples of this, as are some instances of specific-purpose, trading corporations set up by governments. There is no reason why a body politic, in the sense of an organised State or part of a State, might not also be a body corporate. A State legislature could proclaim local government entities as bodies politic and bodies corporate.
104 Madgwick J was assisted by the approach taken by Hungerford J in WorkCover Authority (NSW) v Police Service (NSW) (2000) 50 NSWLR 333. Referring to that judgment, Madgwick J said at [71]:
Section 187 of the Evidence Act 1995 (NSW) abolished the privilege against self-incrimination for bodies corporate. His Honour held that such abolition was effective against the State. In particular, his Honour rejected (at [22]) the notion that the concepts of a body politic and a body corporate "were mutually exclusive". Indeed, as his Honour showed (at [23]), there is much to be said for the view that, in a legal context, as distinct from general modern usage, if such be the preferable view of the context, "a body politic is a body corporate … established for a public purpose".
105 The legislative policy relied upon by Madgwick J to support the construction he preferred was that it was unlikely that Parliament intended that the maximum penalty imposed against the Commonwealth would be equivalent to that of a natural person or one fifth of that which may be imposed on a small family company. Whilst his Honour took a purposive approach to construction, he acknowledged that an inferred legislative policy may have to give way to an intractable statutory text. Madgwick J was of the view that there was no such obstacle (at [57]-[58]).
106 I am not persuaded that the interpretation of "body corporate" adopted by Madgwick J is erroneous and ought not be followed. Nor am I persuaded that Coochey is distinguishable.
107 The approach to construction which Madgwick J took, relied upon s 15AA of the Acts Interpretation Act. The form of that provision relevant to the interpretation of the FW Act (see s 40A(1) of the FW Act) is as follows:
In the interpretation of a provision of an Act, a construction that would promote the purpose or object underlying the Act (whether that purpose or object is expressly stated in the Act or not) shall be preferred to a construction that would not promote that purpose or object.
108 As I said at [110] of my reasons for judgment in the Lend Lease proceeding, the task of statutory construction must focus on the text of the provisions in question, but the meaning of that text requires consideration of the purpose and policy of the provision in the context of the legislation as a whole.
109 The Oxford English Dictionary defines a body corporate as "an entity legally authorised to act as a single individual and having legal rights and duties; a corporation". The term "body politic" is defined as "a nation regarded as a corporate entity".
110 Butterworths Australian Legal Dictionary defines "body corporate" as:
An artificial legal entity having a separate legal personality. It includes bodies created by common law (such as a corporation sole and corporation aggregate), by statute (such as the Australian Securities Commission) and by registration pursuant to statute (such a company, building society, credit union, trade union and incorporated association).
111 Those references suggest that a body politic (a nation regarded as a corporate entity) may be encompassed by the term "body corporate". That is so because a body politic is an artificial legal entity having separate legal personality. It is not grammatically wrong to speak of a body politic as a body corporate. There are examples which illustrate that use. In Conroy v Carter (1968) 118 CLR 90, Taylor J spoke of the Commonwealth in these terms at [101]:
But the Commonwealth, being a body corporate must, if it is to be collected, collect the levy through its servants or agents.
(Emphasis added.)
112 In Commonwealth v Rhind (1966) 119 CLR 584, Taylor J referred to the "corporate capacity" of the Commonwealth in the following observation in which his Honour pointed out that it was unnecessary for the legislation there in question to have deemed the Commonwealth to be a body corporate. At 603 his Honour said:
The enactment of such a provision was entirely unnecessary as the Commonwealth itself has a corporate capacity in that the Constitution which established the Commonwealth quite clearly contemplates it as having a capacity to sue and be sued, to hold lands and other property and to bind itself by the making of agreements.
113 In Melbourne Harbour Trust Commissioners v Colonial Sugar Refining Co Ltd (1925) 36 CLR 230 at 279, Isaacs J referred to bodies politic as species of bodies corporate in the following observation:
The expression "body politic", as distinguished from "body corporate", indicates to my mind a body created for some public purpose. For instance, the Hudson's Bay Company and the East India Company, invested with public functions, were bodies politic. The Sovereign is a body politic (see Magdalen College Case). In Attorney-General for Ontario v Attorney-General for the Dominion (1896) AC 348 at 361, Lord Watson used the expression "body politic" to denote the Dominion of Canada.
114 In CPSU v Commonwealth Branson J imposed penalties upon the Commonwealth by reference to the maximum penalty permitted to be imposed on a "body corporate" by s 298U(a)(i) of the WR Act. Whether the Commonwealth was a "body corporate" does not appear from the judgment to have been the subject of any contest. Nor, is it apparent that her Honour was referred to Coochey. Nevertheless, her Honour needed to be satisfied that the Commonwealth was a "body corporate" within the meaning of s 298U(a)(i) and appears to have had no difficulty in regarding the Commonwealth as falling within that conception.
115 It can be seen both from the ordinary meaning of "body corporate" and the occasional use of that term in the cases to describe entities with a governmental character, that the expression "body corporate" is grammatically capable of including a body politic such as the State. On the other hand, the descriptor "body corporate" is not usually applied to an entity such as the State and the term "body politic" is more apt and thus more likely to be used if a reference to such an entity is intended. The two competing available constructions call for the application of s 15AA of the Acts Interpretation Act.
116 When that is done, it is clear that the construction that "would promote the purpose or object underlying the Act" is that "body corporate" includes the Commonwealth and each of the States and Territories. The legislative policy which Madgwick J referred to in Coochey in support of that conclusion applies equally in this case. However, there are more significant policy considerations here in play because the construction for which the State contends concerns not only the extent of the penalty which may be imposed, but whether a penalty may be imposed at all. I have already identified those considerations which suggest that the purpose or object of the FW Act would be best achieved by the Crown being amenable to a penalty. The maintenance of an effective regulatory scheme is an obvious purpose of the FW Act. That purpose is best effectuated if the conduct of a major labour market participant such as the Crown can be the subject of effective sanctions applied indifferently and free of the anomalous outcomes that would result from the State's preferred construction.
117 The State did not identify any purpose or object of the FW Act that would be best achieved by its construction. I do not accept, for the reasons already addressed, that an object of the Act was to provide the unincorporated emanations of the Crown an immunity in relation to the imposition of a penalty.
118 The conclusion I have reached is somewhat fortified by the legislative history of s 546(2). That the term "body corporate" had been interpreted to include the Commonwealth in Coochey and the Commonwealth's apparent acceptance of that interpretation in CPSU v Commonwealth may well explain the draftsperson's approach, firstly to the terms of s 719(4) of the WR Act (post the WorkChoices amendments), when the categories of "individual" or "body corporate" were first introduced to some of the penalty provisions in Commonwealth industrial legislation and then to the extension of that use to all such provisions in s 546(2) of the FW Act.
119 The presumption which may be made about Parliament's knowledge of the interpretation given by the courts to a statutory term which has been re-enacted was considered in Electrolux Home Products v Australian Worker's Union (2004) 221 CLR 309 at [81] where McHugh J said:
The principle that the re-enactment of a rule after judicial consideration is to be regarded as an endorsement of its judicial interpretation has been criticised, and the principle may not apply to provisions re-enacted in "replacement" legislation. However, industrial relations is a specialised and politically sensitive field with a designated Minister and Department of State. It is no fiction to attribute to the Minister and his or her Department and, through them, the Parliament, knowledge of court decisions - or at all events decisions of this Court - dealing with that portfolio. Indeed, it would be astonishing if the Department, its officers and those advising on the drafting of the Act would have been unaware of Re Alcan.
(Footnote omitted.)
See further Gummow, Hayne and Haydon JJ at [162]
120 On its own, I would not have placed determinative weight on this consideration. That is so despite the fact that the Department that it may be presumed was directly involved in the drafting of the WR Act and the FW Act was the very Department which was involved in the contraventions dealt with in CPSU v Commonwealth. Nevertheless, those facts reinforce the conclusion I have reached.
121 Finally, if I am wrong as to that conclusion, there remains the possibility that the draftsperson simply omitted to include the Crown when addressing the maximum penalty which may be imposed upon the different categories of contraveners. That possibility seems to me to be a more likely explanation for the absence of a specific reference to the Crown in s 546(2) than the proposition contended for by the State that the absence is the deliberate expression of Parliament's intent to provide an immunity to so much of the Crown that remains unincorporated.
122 For those reasons, I reject the State's contention that it is not amenable to the imposition of a civil pecuniary penalty for a contravention of Part 3-1.