//
© 2026 Zoe. All rights reserved.
Zoe is a legal information platform. Always consult the Federal Register of Legislation for authoritative text.
[2001] WASC 79
plaintiff. The Court ordered the agreed pecuniary penalties, repayment of the rebate, and $25,000 in costs, with the minute modified to link it to the agreed statement of facts.
The Court considered penalties negotiated after the defendants admitted improperly claiming diesel fuel rebates for trucking use and making false declarations. The judge stressed that the parties could not decide the penalties for the Court, but treated their settlement as relevant because the case was civil and payment was secured. After considering the seriousness and duration of the offending, the proposed fines, totality, deterrence and recovery prospects, the judge regarded the proposal as reasonable. The order was to be linked to the agreed facts.
AI-generated legal information, not legal advice. Zoe can make mistakes. Check the cited source, and for advice about your situation consult a qualified Australian lawyer.
2,023 words · generated 30/09/2026
The judgment concerns a civil penalty proceeding brought by Narelle Maree Walsh, a delegate of the Chief Executive Officer of Customs, against N and M Gangemi Nominees Pty Ltd and its director, Nino Gangemi. Templeman J heard the matter on 18 November 1999. The reasons were published on 26 March 2001.
No linked legislation citations have been extracted yet.
The defendants operated two businesses: farming and grain carting using a semitrailer truck. Diesel used in the farming business was eligible for rebate, but diesel used in the trucking business was not. Over approximately ten years, the defendants claimed rebates that included fuel used for the ineligible trucking activity. Because eligible and ineligible fuels had been mixed, it was not possible to identify precisely how much fuel had been used for each purpose. The parties negotiated an agreed figure, and the defendants admitted that $53,675.46 in rebate had been obtained without entitlement ([2]-[3]).
The defendants were also charged with making false declarations to the authorities in relation to rebate applications. There were 11 such offences ([4], [13]). The action began as contested litigation but did not proceed to trial. It came before the judge on an agreed statement of facts, after the defendants had, in effect, pleaded guilty to some or all of the offences ([1], [5]).
The parties had negotiated proposed penalties and supporting arrangements. The judge was asked to decide whether to fix those amounts as the penalties of the Court, not simply to endorse a binding agreement between the parties ([6]). The reasons refer to repayment of the rebate over-claim, a proposed fine for the second defendant, penalties for the 11 false declarations, and costs. They also refer to a deed providing for payment over time, secured in part by land to be mortgaged for Customs' benefit ([10], [13]-[16], [22]).
There is an arithmetic point in the reasons that cannot be resolved from the supplied judgment text. Paragraph 10 describes the proposed total as $250,000 and identifies components of $53,675.46, $134,188.65, and $1,688 for each of 11 false-declaration offences. Paragraph 22 says the $250,000 total includes $25,000 costs. Those stated figures do not, on their face, add to $250,000. The judgment does not provide the final minute of order or explain the difference.
The judge began with the Court's institutional role: fixing the penalties was ultimately a matter for the Court, even though the parties had agreed on proposed amounts ([6]). The fact that the claim for penalties was civil mattered. Templeman J considered that ordinary principles encouraging the settlement of civil litigation could apply ([7]). But the judgment does not treat party agreement as sufficient in itself. The judge considered whether the proposed penalties were within the relevant legislative range and appropriate in the circumstances ([6], [10]-[14], [19]).
For the assessment, the judge identified several factors drawn from the authorities to which counsel had referred: seriousness, prevalence, difficulty of detecting the offending, the consequent need for deterrence, whether the offences were committed by people of generally good character, and legislative policy ([7]). The judge noted that mitigating circumstances were not expressly included in that list, but considered that any relevant mitigation had been advanced and taken into account in the negotiated settlement ([9]). The judgment does not set out the parties' mitigation submissions or identify particular personal circumstances.
The judge viewed the conduct as serious and dishonest. The rebate claims related to fuel used for a business that did not qualify, and the conduct had continued for a long period ([3], [11]-[12]). At the same time, the judge said the offences were not the most serious examples that could be imagined ([12]). This assessment supported a penalty below the stated maximum, rather than treating the maximum as inevitable.
The proposed $134,188.65 fine against the second defendant was described as two and a half times the amount of the rebate obtained, and one half of the maximum penalty for the relevant offences ([10]). The judge considered that figure within range and appropriate ([11]-[12]). For the 11 false declarations, the proposal was $1,688 per offence, compared with a stated maximum of $5,000 per offence. The judge also took account of totality, because the penalties related to multiple offences, and considered the proposed per-offence amount reasonable ([13]-[14]).
A further practical consideration was the likelihood of recovery. The proposed arrangements allowed payment over time and, as the judge understood them, included security involving a mortgage over land for the benefit of Customs. The judge regarded full recovery as virtually guaranteed and contrasted this with the less certain result that might follow after a trial and imposition of fines ([15]-[16]). The judge treated this as relevant to the public interest, alongside avoiding complex litigation and securing payment of penalties ([17]-[18]).
On that combined reasoning, the judge found the proposal reasonable and considered that an overall payment of about four times the rebate over-claim would provide a satisfactory deterrent effect ([19]). The order was to be modified so that the agreed facts were linked to the proposed minute, avoiding an order that appeared to contain a declaration by consent that the Court could not make ([21]).
This judgment does not purport to announce a broad change in the law. It applies the Excise Act to an agreed factual basis and explains how the judge approached the proposed civil penalties in this particular proceeding. Its account of the governing considerations is expressly connected to authorities cited to the Court, particularly Lanham v Brake ([7]).
The judgment's main contribution in the text supplied is its explanation of the relationship between negotiated resolution and judicial responsibility. Settlement was encouraged because the matter was civil, and negotiated amounts could be considered. However, the Court still had to decide whether to fix the penalties, assess whether the amounts were within range, and consider their reasonableness ([6]-[7], [19]). The decision therefore does not say that a negotiated penalty is automatically adopted whenever the parties agree.
The reasons also show that the judge considered more than the nominal amounts. The assessment included the nature and duration of the conduct, deterrence, the number of offences, totality, and the practical security of payment ([11]-[19]). The Court's approach reflects the facts and reasoning recorded here; the judgment does not provide a comprehensive statement of every factor that could apply in another case.
The reasons identify Comptroller-General of Customs v Kingswood Distillery Pty Ltd as an unreported decision of Sperling J, saying that the approach in Walsh accords with the view taken there ([17]). The judgment does not set out the reasoning in Kingswood, so no broader account of that decision can be drawn from this text. Nor does this judgment establish what the law was before or after it beyond the principles it expressly discusses.
At paragraph 6, Templeman J says: “ultimately that is a matter for the Court.” In plain English, Customs and the defendants could negotiate, but their agreement could not itself impose the Court's penalties. The judge retained responsibility for deciding what orders to make.
At paragraph 7, the judge says that settlement of civil litigation is “very much encouraged”. This explains why a negotiated outcome was not inherently objectionable. The judge nevertheless evaluated the proposed amounts and relevant penalty considerations rather than treating settlement as conclusive.
At paragraph 11, the judge describes the offending as serious and involving dishonesty. The reasons connect that assessment to the use of rebate claims for fuel used in the ineligible trucking business. At paragraph 12, the judge qualifies the assessment by saying these were not the most serious offences of their kind that could be imagined. Read together, those passages explain why a significant but less-than-maximum penalty was considered reasonable.
At paragraph 14, the judge points to “totality considerations” because there were 11 false-declaration offences. In ordinary terms, the Court looked at the combined effect of multiple penalties, rather than considering each $1,688 penalty in isolation.
At paragraph 16, the judge says that full recovery was “virtually guaranteed” under the payment arrangements as understood. That is a finding about the practical security described in the proposed deed, not a general proposition that negotiated payment plans always secure recovery.
At paragraph 19, the judge concludes that the proposal achieved a “satisfactory deterrent effect”. The reasons link that conclusion to the proposed overall payment relative to the amount of the rebate over-claim and to the other circumstances already considered.
Finally, paragraph 21 addresses the form of the order. The judge wanted the agreed facts linked to the minute so that the order did not appear to contain a declaration by consent that the Court could not make. This was a procedural modification, not a rejection of the negotiated penalty proposal.
The judgment is most directly relevant to a case with features resembling those recorded in its reasons: a civil penalty proceeding under the Excise Act; an agreed statement of facts; admitted or effectively admitted offences; negotiated proposed penalties; and a judicial decision about whether those amounts should be imposed ([1], [5]-[6]).
Its reasoning may be particularly relevant where the penalty assessment involves multiple related offences, a claim that is difficult to quantify precisely, or a proposed payment arrangement secured by assets. Here, the parties could not precisely trace the mixed fuel use and negotiated the amount of the rebate over-claim ([3]). There were also 11 false declarations, which led the judge to consider totality ([13]-[14]). The deed and mortgage arrangements informed the judge's assessment of recovery prospects ([15]-[16]).
The judgment also addresses how the Court may weigh serious, deliberate conduct against other penalty considerations. The judge regarded the offending as dishonest and protracted, but not the most serious possible instance, and accepted penalties below the stated maxima ([11]-[14]). It does not establish that similar amounts or ratios would be appropriate in another matter. The result depended on the agreed facts and the factors the judge identified.
The supplied judgment does not contain any later judicial treatment of Walsh. It records two authorities relevant to its own reasoning: Lanham v Brake, cited for penalty-assessment factors, and Kingswood Distillery, described as an unreported decision whose approach Walsh said it followed ([7], [17]). Those references show the sources the judge invoked, but they do not establish how later courts treated Walsh itself.
The case list in the supplied material includes other decisions, but the body of the reasons does not explain their holdings or say that they were applied. It would therefore be unsafe, on this text alone, to attribute particular propositions or later precedential status to those cases. Assessing subsequent treatment would require later judgments or a reliable citation history, neither of which is included here.
Several matters remain unresolved in the judgment text. First, the final minute of order is not reproduced. Paragraph 21 records that the judge intended to modify the order and hear further from counsel, but the supplied reasons do not state the final wording or list every order ultimately made.
Second, the proposed figures and the stated $250,000 total do not reconcile on their face. Paragraph 10 identifies repayment of $53,675.46, a fine of $134,188.65, and $1,688 for each of 11 offences. Paragraph 22 says costs of $25,000 were included in the $250,000 total. The reasons do not explain the remaining difference.
Third, the judgment does not set out the full agreed statement of facts, the statutory provisions applied to each charge, the detailed submissions on penalty, or the precise security terms in the deed. It consequently provides only a limited basis for comparing the result with other cases.
Finally, the reasons do not describe later treatment of the decision or whether the proposed publicity occurred. The comment that the outcome might bring the message to potential offenders was an expression of hope, not a finding about its actual effect ([20]).
This is general legal information, not legal advice. Zoe can make mistakes. Before acting on this, relying on it, or using any draft, have it checked by a qualified Australian lawyer.
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
CITATION : NARELLE MAREE WALSH, DELEGATE OF THE CHIEF EXECUTIVE OFFICER OF CUSTOMS -v- N AND M GANGEMI NOMINEES PTY LTD & ANOR [2001] WASC 79
BETWEEN : NARELLE MAREE WALSH, DELEGATE OF THE CHIEF EXECUTIVE OFFICER OF CUSTOMS
Primary industry - Taxes and duties - Diesel fuel rebates - Excise Act - Plea of guilty for multiple breaches of Excise Act - Imposition of penalties for illegally claiming diesel fuel rebates - Whether penalties agreed by the office of Customs and the defendant were appropriate and within the range imposed by Excise Act - Whether penalties agreed by parties should be fixed as the penalties of the Court
Comptroller-General of Customs v Kingswood Distillery Pty Ltd, unreported; SCt of NSW (Sperling J); 5 December 1997
Lanham v Brake (1983) 34 SASR 578
Bridal Fashions Pty Ltd v Controller-General of Customs (1996) 140 ALR 681
Comptroller-General of Customs v Jayakody, unreported; SCt of Vic (Byrne J); 9 November 1993
Comptroller-General of Customs v JCT Wong & Rizoli Pty Ltd [1998] NSWSC 711; (1998) 103 A Crim R 491
Evans v Button (1988) 92 FLR 203
Minister for Business and Consumer Affairs v Evans (1984) 54 ALR 128
Minister of State for Customs and Excise v Aunger Accessories Pty Ltd (1969) 16 FLR 94
Murphy v HF Trading Co (1973) 47 ALJR 198
Trade Practices Commission v Allied Mills Ltd [1981] FCA 142; (1981) ATPR 40-241
1 TEMPLEMAN J: I have before me a matter which started out as a contested action by the chief executive of the Office of Customs, against two defendants, N. and M. Gangemi Nominees Pty Ltd and Nino Gangemi. Nino Gangemi is a director of the first defendant. The action is concerned with offences under the Excise Act alleged to have been committed by the defendants. The matter has proceeded before me this morning on the basis of a statement of facts which has been formally agreed by counsel on behalf of the defendants.
2 That statement of facts will be on the court file and will form part of the Court record. It is not necessary for me to read it into these reasons. It is sufficient to say that the defendants were charged with breaches of the Excise Act arising from the use of diesel fuel in respect of which a rebate had been obtained, for purposes which were not permitted if rebated fuel were to be used. Essentially, the defendants were carrying on a farming operation and also a grain carting business using a semitrailer truck.
3 The farm business used diesel fuel which was eligible for the rebate. The trucking business used diesel fuel which was not eligible. Over a period of some 10 years the defendants claimed diesel fuel rebate for fuel which was used for trucking business. It has not been possible, because of the way the rebated and non-rebated fuels were mixed, to say precisely how much was used for each purpose. However, the parties have reached agreement by negotiation as to that: and the upshot of the agreement is that it is now admitted by the defendants that over the relevant period $53,675.46 worth of rebate was obtained when there was no entitlement to it.
4 I should say also that in addition to using the rebated fuel for ineligible purposes, the defendants were also charged with making false declarations to the authorities in relation to applications for fuel rebates.
5 The matter has proceeded by way of negotiation between the parties. The trial has not therefore proceeded because the defendants have, in effect, pleaded guilty to the offences, or some of the offences with which they were charged. The parties have also negotiated what they considered to be appropriate penalties.
6 The matter comes before me to fix the penalties. It is accepted by both parties that ultimately that is a matter for the Court. However, it is urged on me that I should accept the agreement that the parties have reached on the basis that what they have agreed between themselves is within the range of penalties imposed by the relevant legislation.
7 A number of things need to be said about that. The first is that in this unusual situation the claim for penalty under the legislation is a civil matter. That being so there would seem to be no reason why the ordinary principles should not apply in which the settlement of civil litigation between parties is very much encouraged. In various authorities to which I have been referred, and in particular Lanham v Brake (1983) 34 SASR 578 there have been various factors taken into account in relation to offences of this kind. These include the seriousness of the offence, the prevalence of the offence, the obvious difficulty of detecting the breaches, the consequent need to impose deterrent penalties, whether the offences were such as were permitted by persons of generally good character and the legislative policy embodied in the relevant decisions.
8 It is clear from the papers that I have, including proposed minute of order, and deed of agreement and charge, between the Australian Customs Service and the defendants, that a good deal of negotiation has gone into this proposed minute of order. I have no difficulty in making the assumption that all of these factors have been taken into account by the authorities, particularly having regard to the penalties which have been agreed, to which I will refer in a moment.
9 The factors do not directly refer to mitigating circumstances, although one of the matters which is properly taken into account is whether the offences were committed by persons of generally good character. However, the defendants were represented by counsel, and I have no reason to assume other than that any mitigating circumstances have properly been advanced on behalf of the defendants and have been taken into account in the settlement which has been reached.
10 Turning to the penalties which it is proposed, the total figure I am informed is an amount of $250,000. That is made up in this way: first, and quite properly, there is reparation to be made of the $53,675.46, being the rebate that was claimed when it should not have been. Clearly, the defendants have to pay that back. Then it is proposed that there be a fine imposed on the second defendant of $134,188.65. That is two and a half times the amount of rebate obtained by the contravention: and that is a figure which is one half of the maximum penalty which can be imposed for offences of this kind.
11 That figure is clearly within the range and it seems to me to be appropriate. This is a serious offence. It involves dishonesty on the part of the defendants. Although the offences involve a reversal of the normal onus of proof one can understand that that is not unreasonable in the circumstances because claims are made by individuals or companies and the authority has to rely on the honesty of the persons making the claims.
12 However, I can see that although the offences have been committed over a long period of time and must involve conscious dishonesty they are not the most serious of the kind that could be imagined. So, it seems to me, to impose one-half of the maximum penalty is, as I have said, not unreasonable.
13 In relation to the offences of making false declarations, of which there are 11 in number, the maximum penalty for each offence is $5000. What is proposed is that there be a penalty imposed for each offence of $1688, which is about one-third of the maximum penalty.
14 Again it must be borne in mind that we are here concerned with 11 offences, so that there are totality considerations to be taken into account. In those circumstances again it seems to me that the figure of $1688 for each offence is reasonable under the circumstances.
15 There is another factor which seems to me militates in favour of accepting the proposal put up by the parties, and that is this: it is clear from the deed of agreement and charge between the parties that provision has been made for payment over a period of the relevant penalties in a way in which those payments are secured from, amongst other things, the sale of land which is to be mortgaged, as I understand it, for the benefit of the customs service.
16 It follows that although the penalties will be paid over a period, the prospects of recovery in full are virtually guaranteed. If the matter had proceeded to trial and fines had been imposed then the result would not necessarily have been as satisfactory from the point of view of the customs service in relation to recovery.
17 It seems to me that there are strong public policy considerations which militate in favour of this kind of approach. In taking that view I note that it accords with the view taken by Sperling J in the common law division of the Supreme Court of New South Wales in an unreported decision, Comptroller-General of Customs v Kingswood Distillery Pty Ltd, unreported; SCt of NSW (Sperling J); 5 December 1997.
18 It seems to me that there is a public interest in settling the dispute and avoiding the need for complex litigation which this case would have involved: and in protecting the public as far as possible by ensuring that payment of the penalties are made.
19 It seems to me, as I have said, that the amounts of the penalty proposed are reasonable, as being within the range. And involving as they do a payment of something like four times the amount of the over-claim and rebate, it seems to me that the proper settlement achieves a satisfactory deterrent effect.
20 Persons who are tempted to commit this kind of offence in the light of knowledge that these sorts of penalties will be imposed, may well find in the future that higher penalties are imposed. But one would hope that the outcome of this case would achieve a sufficient level of publicity to bring the message home to potential offenders.
21 Given that the statement of facts is agreed it seems to me to be appropriate to make the declaration in terms of the minute of proposed orders. The only modification I would make to the order is to link the statement of facts to the minute so that the order does not appear to contain a declaration by consent which the Court could not make. Subject to that - and I will hear from counsel in a moment - I will make the orders contained in the proposed minute.
22 I should mention only one matter that I have overlooked, and that is that the $250,000 total includes an element of costs fixed at $25,000 which the defendants will pay to the plaintiffs.
Narelle Maree Walsh, Delegate of The Chief Executive Officer of Customs
N and M Gangemi Nominees Pty Ltd & Anor [2001] WASC 79
(1983) 34 SASR 578
(1996) 140 ALR 681
(1988) 92 FLR 203
(1984) 54 ALR 128
(1969) 16 FLR 94
(1973) 47 ALJR 198
(1968) 120 CLR 157
The Court ordered the agreed pecuniary penalties, repayment of the rebate, and $25,000 in costs, with the minute modified to link it to the agreed statement of facts.