Director of Consumer Affairs Victoria v Dimmeys Stores Pty Ltd

REASONS FOR JUDGMENT 1 These reasons for judgment concern a preliminary issue arising in this application which has been commenced by the Director of Consumer Affairs Victoria ("the Director") against the respondents for breaches of the Australian Consumer Law ("the ACL") being Schedule 2 to the Competition and Consumer Act 2010 (Cth). The Director also alleges breaches of the Australian Consumer Law (Victoria) ("ACL Vic") and the Fair Trading Act 1999 (Vic) ("the FT Act"). The preliminary issue is whether the Director is competent to bring this proceeding in this Court. The respondents submit that the Director is not a person who falls within the definition of "any other person" for the purposes of s 232(2) of the ACL. In the substantive proceeding, the Director seeks injunctive relief against the respondents. Section 232(2) of the ACL provides: The Court may grant the injunction on application by the regulator or any other person. 2 It is common ground that the "regulator" for the purposes of the ACL is the Australian Competition and Consumer Commission. 3 Section 138(1) of the CCA confers jurisdiction on this Court in relation to any matter arising under the ACL in respect of which a civil proceeding has been instituted under the ACL. If the Director had no authority to institute the current proceeding, the Court has no power to make any orders in the proceeding. 4 Although the respondents previously filed written submissions which suggested that an issue arose as to the possible impairment of state governmental functions if the Director was "any other person" for the purposes of the ACL, that submission was not pursued when this preliminary issue was advanced by oral submissions before the Court. 5 Counsel contended that the ACL demonstrated no legislative intention to bind the Crown in the State of Victoria. That is a false issue. The State of Victoria is not a respondent to this proceeding. The issue for current determination is whether a public official representing the State has the authority to issue a proceeding relying on Commonwealth legislation in this Court. It depends on whether the Court considers that the Director, not being the relevant regulator for the purposes of the ACL, is "any other person" for the purposes of s 232(2) of the ACL. For reasons which follow, the answer to that question is yes. 6 The Director is a statutory office holder under s 107 of the Australian Consumer Law and Fair Trading Act 2012 (Vic) ("the State Act"). That section provides: There is to be a director of Consumer Affairs Victoria employed under Part 3 of the Public Administration Act 2004. The functions of the Director are set out in s 109 of the State Act. They include a function to "institute and defend proceedings to achieve the purposes of this Act…" 7 The purposes of the State Act include advising persons of their rights under that Act, receiving complaints from persons and dealing with them in accordance with that Act and prosecuting breaches of that Act. 8 It is often the case, as the Director alleges here, that breaches of the ACL may also involve breaches of materially identical provisions in broadly equivalent State Acts. It would be part of achieving the purposes of the State Act to bring proceedings that not only invoke that Act but that also rely on the ACL. 9 In 2008, the Victorian Parliament amended the FT Act by inserting a function of the Director "to achieve the purposes of the [State Act]; see s 5 of the Fair Trading and Consumer Acts Further Amendment Act 2008 (Vic). It was a purpose of that amendment, according to the Second Reading Speech in support of the relevant bill, to: ….[remove] an impediment in the Act to the director conducting proceedings under the Trade Practices Act 1974 (Cth) in the Federal Court, allowing the director…to seek a Court order enforcing notices requiring information or documents under the Act. 10 A removal of an impediment to the Director conducting proceedings under the predecessor legislation to the ACL is not limited to the named purposes referred to in the Second Reading Speech. There is no logical reason why the amendment does not extend to the removal of an impediment to the institution of any proceedings which further the objects of the State Act. The purposes of that Act are achieved by the institution of proceedings seeking to enforce consumer protection provisions which are common to that Act and the ACL. 11 The State Act was assented to on 8 May 2012. It repealed the FT Act; see s 1(h). The functions of the Director as contained in the previous legislation were retained in the State Act in s 109. The Second Reading Speech which accompanied the bill which led to the new Act did not evince any intention to reimpose the impediment which had been removed in 2008 to the Director instituting proceedings under federal consumer law. 12 It is not without significance that, in the current proceeding, the Director raises alleged contraventions of the ACL and of the State Act. The latter claims arise out of the same substratum of facts as the former claims and together they constitute one matter for the Court's determination. Such an approach is consistent with the desire expressed by the Victorian Parliament in enacting the State Act to support the ACL with complimentary state provisions. In support of the bill which led to the State Act, the relevant Minister, Mr Tony Robinson, said in his Second Reading Speech on 12 August 2010: The Productivity Commission's review of Australia's consumer policy framework in April 2008 identified a need to harmonise consumer laws across Australia, removing regulatory duplication and inconsistency, and improving the coordination of consumer policy development. Following the Productivity Commission's review, the Ministerial Council on Consumer Affairs developed proposals for a single national consumer law informed by the consumer protection provisions in the Commonwealth Trade Practices Act 1974 and the best practice elements from the various state and territory fair trading acts. It was agreed that the national laws would include a new national product safety regime, civil pecuniary penalties, enforcement powers and options for representative actions. Significantly, it was also agreed that the uniform laws should include provisions based on the Victorian Fair Trading Act, protecting all Australians against unfair terms in consumer contracts. In July 2009, the Victorian Premier signed the Intergovernmental Agreement for the Australian Consumer Law. The intergovernmental agreement sets out the agreement between the commonwealth, state and territory governments for the initial implementation of the new Australian Consumer Law and the future administration and enforcement of those laws. This bill implements the Australian Consumer Law in Victoria. This bill delivers on Victoria's commitment under the intergovernmental agreement. It also delivers on a key aspect of the Council of Australian Governments' national business and regulatory reform agenda, the realisation of a seamless national economy. …. The Australian Consumer Law includes enforcement powers and remedies which will apply in Victoria, including civil pecuniary penalties, disqualification orders, substantiation notices, infringement notices, public warning ('naming and shaming') powers and redress options for non-party consumers. While many of these powers have been available to the Victorian regulator under the Fair Trading Act, civil penalties and redress options for non-party consumers are an enhancement to the remedies available for contraventions of consumer laws. 13 Counsel for the respondents relied on the intergovernmental agreement referred to in the Minister's Second Reading Speech in support of the submission that the Director had no authority to commence this proceeding. Counsel did not point to any particular provision which mandated that result. 14 The intergovernmental agreement was designed to effect a national approach to consumer protection laws. It is not inconsistent with such an approach for a state regulator to commence a proceeding relying on the ACL in respect of matters which primarily concern that state but also affect consumers in other states. The current proceeding is a typical example which mainly concerns conduct in Victoria but also to a lesser extent in neighbouring states. The intergovernmental agreement also provides for shared enforcement functions between federal, state and territory regulators. It is consistent with such a shared scheme for the Director to be considered to be "another person" for the purposes of the ACL. The intergovernmental agreement does not govern the resolution of that issue. However, there is no contrary intention expressed in the intergovernmental agreement which would support the conclusion that the Director would not be entitled to bring this proceeding. 15 For the foregoing reasons, the Court rejects the respondents' submission that the current proceeding ought to be dismissed on account of the Director's lack of authority to institute it. 16 The Court has recently by consent made orders for the further conduct of this proceeding and orders to protect consumers on an interim basis pending the final hearing and determination of the matter. The consent orders made also dealt with costs and adjourned the hearing to 10.00 am on 16 September 2013, with 17 and 18 September 2013 also reserved. I certify that the preceding sixteen (16) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Marshall.