Decision
51 In determining what penalty I should impose for each of the 26 offences I consider that I should, so far as is possible, apply the principles of sentencing stated in Pearce. In accordance with those principles I should first fix an appropriate penalty for each offence. That penalty, apart from any discount for a plea of guilty, should be the same amount, because all of the offences involved the same kind of conduct and the defendant's subjective circumstances were the same.
52 I should then give effect to the principle of totality, in the only way which is available where the only penalty which can be imposed is a fine, by reducing the amount of the penalty for each offence. The objective should be to ensure that the aggregate penalty should fairly and justly reflect the total criminality of Eureka's conduct: see R v Weldon (2002) 136 A Crim R 55 per Ipp JA at 62 [46].
53 It is necessary to assess the level of objective seriousness of each of the offences.
54 I take into account the submissions made by counsel for the prosecutor about the legislative purposes underlying s 61B, as stated in the second reading speech by the Minister for Health. Section 61A of the Act provides that the objects of Div 4 of Pt 6 in which s 61B is contained include the promotion of good health and the prevention of illness.
55 While I accept that some degree of planning may be inherent in any offence under s 61B, I consider that the degree of planning in the present case, as shown by the tobacco multibuys offer memo from Coles Express to its employees, exceeded what would be inherent in any offence under s 61B.
56 I accept that an element of an offence under s 61B is that the offender display the advertisement for a direct or indirect benefit to the offender and that a message will not amount to a "tobacco advertisement" within the part of the definition of that expression in s 53 of the Act which was relied on by the prosecutor, unless it is intended to promote the purchase of a tobacco product. I also accept that the benefit which could be made from each "displaying" of an "advertisement" would be very small. Nevertheless, the tobacco multibuys offer memo, including the suggestion that stores increase by 20 per cent their holdings of stocks of cigarettes to which the offer applied, shows that Eureka foresaw a substantial financial benefit to itself from pursuing a course of conduct of making offers of the kind made in the commission of each offence. I consider that the general principle stated by Preston CJ in par [229] of his Honour's judgment in EPA v Waste Recycling have some application in the present case.
57 On the other hand, I accept the submission made by counsel for Eureka that on each occasion what I found to be an "advertisement" was displayed to one person only and that that person had approached Eureka's employee seeing to buy a packet of cigarettes and that it can be inferred that that person was an adult and was already a smoker of cigarettes. Eureka had obtained legal advice that what it proposed to do was legally permitted.
58 I take into account the maximum penalty for an offence under s 61B. However, the objective seriousness of each of the present offences is clearly much less than would be the objective seriousness of an offence in the worse class of cases, an example of which might be an explicit advertisement of tobacco products published or broadcast in the media to a large audience, including children and non-smokers.
59 The conclusion I have reached as to the objective seriousness of each offence is that its objective seriousness fell well below the middle of the range of objective seriousness for offences under s 61B.
60 I take into account Eureka's favourable subjective circumstances. It pleaded guilty to 23 of the charges and in the case of each of the charges where liability was not admitted, it assisted the conduct of the proceedings by making some admissions and by limiting the issues.
61 I accept that Eureka has expressed genuine regret for its actions, that it takes its obligations seriously, that it has no previous criminal convictions, that it has been a corporate citizen of good character and that it is unlikely to offend again.
62 While specific deterrence may not be necessary, there remains a need for the penalties I impose to give effect to general deterrence.
63 It was submitted by counsel for Eureka that I should take into account in favour of Eureka that the proceedings by the prosecutor could have brought in the Local Court, where a lower maximum penalty would have applied (s 61M(2) $11,000). It was not suggested that the penalty I could impose would be limited to the maximum penalty which could have been imposed in the Local Court. Counsel referred to R v Crombie [1999] NSWCCA 297; Environment Protection Authority v Barnes [2006] NSWCCA 246; R v Doan (2000) 50 NSWLR 115.
64 I accept that the fact that the proceedings could have brought in the Local Court where there would have been a lower maximum penalty is relevant but I do not consider that I should give this factor much weight in the present case. In my opinion, the proceedings were properly brought in the Supreme Court. The proceedings raised a novel question of construction of the provisions of the Act and it is highly probable that, if the proceedings had been brought in the Local Court, an appeal would have been brought to this Court.
65 As previously noted, counsel for the prosecutor submitted that the making of the agreed costs order against Eureka that it pay the prosecutor's costs amounting to $50,000 was irrelevant to the determination of what fines should be imposed for the offences, whereas counsel for Eureka submitted that the costs order was relevant to determining what fines should be imposed.
66 Counsel for Eureka referred particularly to Environmental Protection Authority v Barnes. As the name of the case indicates, this was a prosecution of an individual (Mr Barnes) for offences under environmental legislation. Mr Barnes pleaded guilty and was sentenced by her Honour Justice Pain of the Land and Environment Court. The Environment Protection Authority appealed to the Court of Criminal Appeal against her Honour's sentencing orders.
67 The leading judgment in the Court of Criminal Appeal was delivered by Kirby J, with whom the other members of the Court agreed.
68 In a discrete part of his judgment Kirby J considered a ground of appeal that the sentencing judge in determining the amounts of the fines she would impose had erred in her consideration of Mr Barnes' means to pay the fines. It was not submitted by the Authority that Mr Barnes' means to pay fines were irrelevant. What was submitted by the Authority was that the sentencing judge had disregarded an asset of Mr Barnes and his wife and had not given sufficient weight to countervailing sentencing considerations. In his judgment Kirby J referred to s 6 of the Fines Act, which provides in part:-
"In the exercise by a court of a discretion to fix the amount of any fine, the court is required to consider:
(a) such information regarding the means of the accused as is reasonably and practically available to the court for consideration…"
69 Kirby J held that the sentencing judge had not made any error of principle and rejected this ground of appeal. It was relevant to the sentencing of Mr Barnes that he "had limited means to pay a substantial fine (and costs)".
70 Later in his judgment, in considering a ground of appeal that the penalties were manifestly inadequate, Kirby J said at [88]:-
"Returning to the penalty imposed upon Mr Barnes. As a matter of first impression, the fines imposed appeared unduly lenient, suggesting error. However, the fines were part only of the penalty. Mr Barnes was obliged to pay substantial costs. Her Honour made it clear that, but for that fact, the fines she would have imposed would have been much higher."
71 It is clear that Kirby J considered that the sentencing judge had not erred in taking into account Mr Barnes' obligation to pay substantial costs.
72 I was referred by counsel for Eureka to other, subsequent, decisions of Pain J of the Land and Environment Court: EPA v Buchanan (No 2) [2009] 165 LGERA 383 especially at [121] and EPA v Ross [2009] NSWLEC 36 especially at [104]. Both Buchanan and Ross were cases of individual offenders who gave evidence of having limited financial means.
73 I was also referred by counsel for Eureka to Construction, Forestry, Mining and Energy Union v BHP Steel (AIS) Pty Ltd (2003) 196 ALR 350, in which members of the full court of the Federal Court held that in determining the penalty which should be imposed on a union for contempt of an order of the court, it was appropriate to take into account the significant burden likely to have been imposed on the union by an indemnity cost order made by the primary judge.
74 It is clear that in exercising a discretion to fix the amount of a fine a court is required by s 6 of the Fines Act to consider such information regarding the means of the offender as is available to the Court. In the present case, of course, there was no information before the court suggesting any lack of means to pay a fine. Indeed, Mr Struck's affidavit emphasised the size of Eureka's operations. Its turnover for the 2008 financial year was said by Mr Struck to be approximately $6billion.
75 In a case such as the present where there is no doubt about the means of the offender to pay whatever fine might be imposed, the fact that an offender has been ordered or will be ordered to pay another party's legal costs should not be given much weight.
76 I have concluded that an appropriate penalty for each offence, considered by itself, would be $7000. I consider that I should then reduce that figure to $5000 in order to give effect to the sentencing principle of totality. I should reduce the amount of the penalty by $1000 to $4000, in the case of the 23 offences in respect of which a plea of guilty was entered. The total amount of the fines will be $107,000.
77 I make the following orders:-