Appeal ground 1
169 By appeal ground 1, the appellants contend that the primary judge erred in concluding that the impugned conduct constituted an unconscionable system of conduct in contravention of s 21 of the ACL in circumstances where:
(a) the risks identified by the primary judge were addressed in the specific regulatory framework which bound the College, and the ACCC did not allege or prove that the College had failed to comply with that regulation;
(b) the College's enrolment procedure prior to the enrolment process changes both exceeded the specific regulatory requirements and was out of step with the market;
(c) the College made the enrolment process changes together with other changes to its systems, addressing risks in a manner it believed was compliant with the regulatory requirements under which it operated;
(d) the trial judge made no finding of the extent to which the risk of agent misconduct materialised (nor did the evidence allow a finding to that effect);
(e) although the trial judge found that students "might" be unsuitable for various reasons and that the proportion of unsuitable students that were enrolled rapidly escalated, the extent of that risk or the materialisation of that risk was not known at the time the changes were made or implemented; and
(f) the statutory norm in s 21 applies to unconscionable conduct, not to the identification of the risk of conduct and protection of students from that conduct engaged in by others.
170 In effect, the appellants contend by ground 1 that the primary judge failed to weigh all of the circumstances, and particularly those circumstances identified in the preceding paragraph.
171 We reject that contention. Perversely, it was the submissions advanced by the appellants in support of ground 1 that involved a selective approach to the facts and a failure to confront the totality of the factual circumstances as found by the primary judge. In most respects, the submissions of the appellants involved cherry-picking and nit-picking. Such an approach is contrary to established principle, which requires an examination of all the circumstances.
172 As a starting point, the appellants observed that the primary judge found that the College's altered enrolment process was unconscionable, at least in significant part, because the process did not adequately protect students from risk. The appellants submitted that such a finding is unusual because the statutory norm usually applies to unconscionable conduct, not the risk of unconscionable conduct. That submission involved a non-sequitur. The primary judge did not find that the impugned conduct gave rise to a risk of unconscionable conduct. The primary judge found that the impugned conduct was unconscionable because:
(a) the College knew of the risks, which regularly materialised and which arose from the unethical or careless conduct of recruitment agents, of persons being enrolled in the online campus in circumstances where the person does not do so willingly and with full knowledge of the obligation being incurred (the VFH debt) or where the person is unsuitable for enrolment because they lack sufficient language, literacy or numeracy skills or technology skills or access;
(b) the College knew that the outbound QA call enrolment procedure and the campus driven withdrawal procedure provided important safeguards against those risks;
(c) despite that knowledge, and for the purpose of profit maximisation, the College altered its enrolment process to remove the outbound QA call procedure and the campus driven withdrawal procedure;
(d) the College knew or ought to have known that the changes to the enrolment process and the abolition of campus driven withdrawals dramatically increased the number of enrolments by disengaged students; and
(e) the College knew or ought to have known that its dramatic increase in revenue was substantially built on VFH revenue in respect of students who may have been the victims of CA misconduct, were unwitting or unsuitable for enrolment, should not have been enrolled and who would gain no benefit whatsoever from their enrolment, yet who incurred very substantial debts to the Commonwealth as a result of their enrolment.
173 Next, the appellants submitted that the primary judge's finding was novel because it was based on a system that "did not adequately meet the risk of someone else engaging in wrongful conduct, where the wrongful conduct was in contravention of that person's instructions and training". Asserted novelty is no answer to the application of the statutory proscription against unconscionable conduct. As discussed earlier, the proscription is not limited to particular types or categories of conduct or circumstance such as those to which equitable principles would apply. The proscription is broadly framed and is capable of application to myriad circumstances that may arise in commerce. In support of the "novelty" submission, the appellants sought to contrast the facts of the present case and the facts of other cases such as Australian Securities and Investments Commission v National Exchange Pty Ltd (2005) 148 FCR 132 and Stubbings v Jams 2 Pty Ltd [2022] HCA 6; 399 ALR 409. The comparisons are of no assistance as each case involves entirely different factual circumstances. The submission that the "risk" concerned the behaviour of recruitment agents and that any such behaviour would be in contravention of the College's instructions and training of agents involves a narrow portrayal of the relevant circumstances and the College's conduct. The full picture requires consideration of the facts that: the College chose to outsource student recruitment to agents on a commission basis; risks and problems arose from student recruitment that were known publicly through Senate inquiries and media reports and also known privately by the College; prior to the enrolment process changes, the College knew that some 50% of enrolled students withdrew or were withdrawn before the first census date; and the College knew that the outbound QA call enrolment procedure and the campus driven withdrawal procedure provided important safeguards against those risks. It is plain from the evidence that the College's instructions and training of agents was ineffective to prevent unwitting and unsuitable students being enrolled, and that was known by the College. In that knowledge, the College acted in a manner that reduced the existing safeguards for such students in the pursuit of increased VFH revenue which would burden those students with VFH debt. Additionally, it cannot be overlooked that the CCA attributed legal responsibility to the College for the conduct of its recruitment agents (as will be discussed below).
174 The appellants submitted that, while the primary judge found that the College knew that there was a real risk of misconduct by agents, the findings do not evidence any intent for this risk to eventuate and do not demonstrate that the College took advantage of the risk. In support of that submission, the College placed reliance on an email sent by Mr Cook on 20 September 2015 to Vernon Wills and Blake Wills, amongst others, which asserted that there was "already a very robust and rigorous agent selection, on boarding and monitoring process" in place and that, aware of potential risks with agents, the College was "taking what we believe are the necessary precautions" (see PJ [333]). The appellants submitted that those precautions included:
(a) contractual obligations in its contracts that required agents to carry out sales fairly, providing accurate information to prospective students (PJ 525);
(b) an agent induction and on-boarding process comprised of a training presentation, a knowledge quiz aimed at training agents to act appropriately (PJ 525, [527]);
(c) maintaining a Student Complaints Register, Agent Issues and Complaints Register and CA Monitoring Log to address agent misconduct (PJ [417]-[420], 525);
(d) speaking directly to prospective students during the inbound QA call to confirm the consumer's contact details and provide information, including withdrawal information, and ascertaining whether prospective students completed the PEQ (PJ [292], 525);
(e) a system for admissions officers to flag concerns about a QA call or student, so that enrolment was not processed until the concern was resolved (PJ [310]);
(f) terminating relationships with marketing partners or individual agents when misconduct had been established (PJ [426], [427]);
(g) reversing enrolments or reimbursing students' VFH debts in cases in which it thought CA misconduct had occurred (PJ [418], [422], [424], [428], [429], [433], [436], [437], [440], [441], [444], [445], [452], [453], [654], [690], [719]-[720], [751]).
175 The appellants submitted that, merely because later in time facts demonstrate the system could have been executed more robustly or failed does not allow a conclusion of unconscionable conduct.
176 The submission that the primary judge's findings do not evidence any intent on the part of the College for the risk of agent misconduct to eventuate may be accepted but is not determinative of the question whether the College's conduct was unconscionable (see for example Kobelt at [91] per Gageler J). The College was not seeking agent misconduct, whether in the form of misleading students to enrol or being careless as to the suitability of students to undertake the courses for which they enrolled, and it can be accepted that the College had the staff and facilities to provide the education courses it offered. The College was not conducting a sham organisation. The appellants' submissions that "there is no reason to assume that enrolling a student in a course of vocational education would be against the interests of consumers" and "there was nothing inherently deficient in the courses offered" can also be accepted, but does not confront the burden of the case put against the College.
177 We reject the appellants' further submission that the primary judge's findings do not demonstrate that the College took advantage of the risk of agent misconduct. The findings demonstrate precisely that, and that is what the primary judge found (at PJ [500]). The risks and problems associated with the VFH scheme and the College's use of agents to recruit students were known to the College. There could not be a more powerful demonstration of the risks and problems than the fact that, prior to the enrolment process changes, about 50% of enrolled students withdrew or were withdrawn before the first census date. This was not merely a theoretical risk; it was a manifest problem. It was plain that the College's agents had been recruiting large numbers of students who did not understand what they were committing to. The College knew that the outbound QA call enrolment procedure and the campus driven withdrawal procedure provided important safeguards against that problem. The catalyst for the College to change its enrolment process and remove those safeguards was the fact that agents were increasingly referring students to VET providers other than the College because they were unhappy with the College's enrolment process, and the College's revenue was declining as a result. The College changed its enrolment process in consultation with its agents to placate its agents. It removed the two safeguards for students with the result that more students would pass through the first census, incurring a VFH debt, and agents would receive more commission. This gave agents the incentive to refer more students to the College. The result was that the College's revenue experienced an exponential increase, brought about by the combined effect of an increased number of students enrolling and a much higher proportion of those students passing the first census. In changing its enrolment process, the College took advantage of the known risks and problems of the VFH scheme and its recruitment system to gain a financial benefit for itself to the disadvantage of persons who enrolled in circumstances where the person did not do so willingly and with full knowledge of the obligation being incurred (the VFH debt) or where the person was unsuitable for enrolment because they lacked sufficient language, literacy or numeracy skills or technology skills or access.
178 The "precautions" relied upon by the College, as listed above, are relevant considerations and were considered by the primary judge. The appellants' submissions fail to address, however, the primary judge's findings with respect to those "precautions". As his Honour observed at PJ [526], none of these elements of the College's business system, individually or together, was sufficient to protect students and there was no evidence from the corporate respondents to support any finding that any officer on behalf of the corporate respondents believed that these components operated effectively to protect students. The elements were in place prior to the changes to the enrolment process, during which time agent failings with respect to student recruitment can only be described as common-place and were known to the College. Taking each of the matters in turn:
(a) The primary judge found that, while there were contractual terms requiring agents to act promptly and honestly, and they received training in that respect, it was known that there was a risk that they would not act as required (PJ [527]). It can be added that there was more than a risk; it was common-place. There was no evidence of any material change in training practices during the impugned enrolment period.
(b) The primary judge found that, while the College maintained a Student Complaints Register and an Agent Issues and Complaints Register, the ordinary process of review and follow-up on complaints was less than thorough (PJ [422]). In relation to the Agent Issues and Complaints Register, the primary judge found that Khaled Akbery was responsible for dealing with those complaints but there was no evidence with regard to what he did, if anything, to monitor agents and what he did, if anything, in response to complaints about agents (PJ [419]). On the evidence adduced at trial the primary judge concluded that the quality and nature of complaint handling and investigations was not such as to have justified any belief that it contributed significantly to reducing the risk of agent misconduct or unsuitable enrolment (PJ [460]). There is no challenge to those findings.
(c) In relation to the inbound QA call, the primary judge identified numerous deficiencies in the process as a means of detecting unwitting and unsuitable enrolments including that:
(i) the inbound call was done with the recruiting agent present with the student, with the result that the admissions team member conducting the QA call was not able to be confident that the answers given were indeed the student's answers and were not influenced or prompted by the recruiting agent (PJ [304]);
(ii) for that reason, it increased the risk of agent misconduct and enrolling unsuitable students (PJ [305]);
(iii) the admissions team member would see the enrolment documents for the first time while on the call and would thus not have the opportunity to examine the enrolment documents in advance and identify any problems or any indicators of unsuitable enrolment (PJ [307]);
(iv) the call was not itself designed to be a means of assessing the student's suitability (PJ [308]);
(v) a student could become enrolled while never being contactable by the College because the QA call point of contact was initiated by the recruiting agent (PJ [311]); and
(vi) there was no post-enrolment assessment of language, literacy and numeracy capability which, if negative, would lead to withdrawal of the student prior to first census (PJ [312]).
(d) The evidence showed that, on at least two occasions, the College terminated its contract with a sales and marketing agent when misconduct had been established (PJ [426] and [427]). The numbers of students enrolled by those agents is small in comparison to the total numbers of students who enrolled with the College in the period prior to and during the impugned enrolment period. That fact has little significance in comparison to the scale of the problems of unwitting and unsuitable enrolments that existed prior to and during the impugned enrolment period.
(e) The evidence also showed that the College reversed enrolments or reimbursed students' VFH debts in cases in which it thought agent misconduct had occurred. However, the primary judge's findings demonstrated that the College's actions in this respect were wanting. The primary judge found that there were a number of weaknesses in the College's investigations and responses, including limiting some investigations by time and geography where all enrolments by the agents concerned would appear to have warranted investigation, and not taking any action in respect of students categorised as "progressing satisfactorily" where such categorisation appears to have been unjustified (PJ [459]). The primary judge also found that there was inadequate follow-up on complaints until the College was required by the ACCC to report complaints and investigations, and several of the investigation reports appear to have been prepared specifically in response to that requirement (PJ [460]). Overall, and as noted above, the primary judge concluded that the quality and nature of complaint handling and investigations was not such as to have justified any belief that it contributed significantly to reducing the risk of agent misconduct or unsuitable enrolment.
179 The primary judge's findings, when read as a whole, demonstrate that the College could not have had any basis for a belief that the elements of its business systems described above would materially reduce the risk, which arose from the unethical or careless conduct of recruitment agents and which regularly materialised, of persons being enrolled in the online campus in circumstances where the person does not do so willingly and with full knowledge of the obligation being incurred or where the person is unsuitable for enrolment because they lack sufficient language, literacy or numeracy skills or technology skills or access. Rather, the elements of its business systems that were proven to have materially reduced that risk were the outbound QA call and particularly the campus driven withdrawal process. Under financial pressure brought about by agents bypassing the College because of its more stringent enrolment processes, the College removed those elements of its system.
180 The appellants also placed reliance on the steps taken by the College during the impugned enrolment period to contact students, submitting that such steps are inconsistent with the primary judge's conclusion that the College took advantage of the students who were enrolled as a result of agent misconduct or who were unsuitable for enrolment by maintaining their enrolment and claiming VFH revenue from the Commonwealth or both (at PJ [500]). In that regard, the appellants referred to the following matters:
(a) in November 2015, the College substantially increased staff recruitment within the student support officer, admissions and training teams (PJ [360]);
(b) during the impugned enrolment period, the topic of the level of student engagement was regularly discussed between management team members (PJ [368]);
(c) when Ms Stevens started at the College in October 2016 as a student support officer, she had to drop everything to try and call students before their census date (PJ [376]), she flagged students she could not reach so another student support officer could try again (PJ [378]) and her team were "relentless" in trying to get in touch with students to make sure they understood "what they were getting themselves into" (PJ [381]);
(d) in an internal email exchange on 9 December 2015 between Ms Stevens and her supervisor, Ms Stevens wrote: "it's good to know there is a dedicated team at CCC between Khaled, Elle and all the SSO's trying to make sure only suitable students are enrolled" and Ms Stevens gave evidence that allowing students to withdraw, even if the student had passed the census date, occurred from time to time (PJ [388]);
(e) on occasions, the College withdrew and refunded students despite the terms of its policy (PJ [322]);
(f) when concerns were raised about the English language skills of some students, Mr Buonora (Manager of the online campus) asked staff to research resources the College could make available to students on the learning management system (PJ [393]); and
(g) in February 2016, the College developed a "Student Support - contact strategy" outlining ongoing efforts to contact and engage enrolled students (PJ [408]).
181 Again, the appellants' reference to and reliance upon the foregoing matters does not present the full facts, either as to the individual matters referred to or as to the broader picture in which those individual matters should be considered. The broader picture was the decision, made by senior management of the College with the knowledge and implicit endorsement of the senior management of Site, to change the enrolment process to remove important safeguards against known risks of enrolling unwitting and unsuitable students. The decision was taken knowing the risks and problems associated with the enrolment of unwitting and unsuitable students through the carelessness or misconduct of recruitment agents. The decision was taken to address complaints by agents who considered the College's enrolment process to be too stringent and who were referring students elsewhere. The decision was taken in the expectation that agents would refer more students to the College and revenue would increase. The decision was taken in circumstances where the College knew or should have known that the number of unwitting and unsuitable students would increase with the increase in enrolments. It is against that backdrop that the individual matters relied on by the College fall to be considered. Those individual matters largely concern the efforts undertaken by more junior staff to make contact with students and identify unwitting and unsuitable students prior to the first census date. Given the escalation in numbers of the enrolment of unwitting and unsuitable students brought about by the enrolment process changes, the evidence showed that the efforts undertaken by more junior staff were futile. They were simply overwhelmed. That ought to have been known by senior management.
182 Turning to the individual matters relied on by the appellants:
(a) Mr Cook's CEO report on 17 November 2015 reported that, as student numbers had "increased significantly due to the new enrolment process and on boarding of new agents", there had been a substantial increase in staff recruitment within the student support officer, admissions and training teams (PJ [360]). That fact hardly ameliorates the impugned conduct. It occurred some two months after the changes were made. Further, as the primary judge found, the College's assumption at that time was that about 80% of enrolled students would not engage in the course (PJ [365]-[367]). There is no suggestion that staff recruitment would alter that critical problem.
(b) Ms Edwards gave evidence that, during the impugned enrolment period, the topic of the level of student engagement was regularly discussed between management team members. The context for that evidence was Ms Edward's evidence that, on a number of occasions during the impugned enrolment period, she accessed the learning management system to find out what proportion of students had logged in, and it showed that only a very small proportion of the enrolled students were actually accessing the system. Ms Edwards said that the figures for the level of engagement were readily available on the system (PJ [368]). Thus, it can be inferred that the matter that was discussed between the management team was the low level of student engagement, reinforcing the College's knowledge of the escalating problem of disengaged students.
(c) Ms Stevens's evidence was to the effect that, during her period of employment as a student support officer from 19 October 2015 to January 2016, she worked hard in an effort to contact and engage enrolled students. However, her evidence was that when she started at the College there was a huge influx of students and that, by the time she came to the end of her time at the College, she had been allocated approximately 400 to 500 students and there were more than 30 student support officers (PJ [376]). She had great difficulty in attempting to contact the students allocated to her (PJ [377]); for the most part, Ms Stevens was unsuccessful in contacting students and spoke to around 10% of the students that she tried to reach (PJ [378]). That figure is consistent with Ms Thompson's data, showing that of the students who enrolled during the impugned enrolment period, about 87% never logged into the learning management system; in other words, they were entirely disengaged (and, it can be inferred, can be characterised as unwitting or unsuitable students). Ms Stevens' team leader confirmed that this was a constant topic amongst the team of student support officers (PJ [379]).
(d) The primary judge found that, notwithstanding the removal of the campus driven withdrawal policy, the College's new policy had limited grounds on which a student's enrolment could be cancelled after the first census date. However, cancellation depended on the initiative of the student in raising a complaint, and the complaint then having some basis for a conclusion of "special circumstances" (PJ [322]). The primary judge illustrated the effect of the change by a particular case in December 2015 where a student raised with someone at the College that she had no idea that she had incurred a VFH debt, did not know what it was, was confused, had no idea what she had signed up for, and was not interested in studying. She had never logged in to the learning management system and had remained uncontactable despite several attempts over nearly three weeks. Mr Buonora, the Campus Manager, responded to the case when it was escalated to him in February 2016 saying that he could not approve a campus driven withdrawal due to the College's policy, that he did not have the "facility to withdraw a student", and could only cancel an enrolment "once the circumstances are clear" (PJ [319]).
(e) Ms Solly was employed in around 18 November 2015 as a training and development officer with the College in the Diploma of Business. Around the end of January 2016, Ms Solly was given a list of names and her job was to manage the list to make sure she made initial contact with every student. She ended up with 264 names but only managed to make contact with a dozen. The language skills of the students she contacted in some instances were not developed sufficiently to be able to comprehend the course materials. Ms Solly raised her concerns with regard to the competency of the students with Mr Buonora. Her evidence was that there was a general concern about the English-language skills of the prospective students. Mr Buonora's response was to ask Ms Solly to research resources that the College could make available to students on the learning management system (at PJ [391]-[393]). The absurdity and futility of that response is readily apparent. The College was not offering courses in the English language. Ms Solly was responsible for students who had enrolled for a Diploma of Business, but had insufficient language skills. It could hardly be expected that students would be able to acquire English language skills using resources on the learning management system, while at the same time undertaking the Diploma of Business.
(f) It can be accepted that, in February 2016, the College developed a "Student Support - contact strategy" and that the strategy reflected ongoing efforts to contact and engage enrolled students. As discussed earlier, the strategy had 5 categories (A to E), three of which related to uncontactable students. A report dated 18 February 2016 showed that 55% of the students, all of whom had by then passed through the first census (and incurred a VFH debt) were uncontactable and not engaged with the College (PJ [409]). Mr Buonora accepted that it was "highly unlikely" that they would ever be in contact with the College. The primary judge found that the College's strategy was to keep trying to contact them until eventually a "letter of concern" was sent to them, but the withdrawal policy did not permit them to be withdrawn and their debts reversed (PJ [409]). The contact strategy merely highlighted the enormous problem the College had with disengaged students; it did not in any sense ameliorate the problem.
183 The appellants submitted that there was no evidence that any particular student was suffering from some specific disadvantage or had been misled or improperly pressured into making the decision to enrol. The appellants further submitted that consumers are generally imputed with a real degree of personal responsibility for their decisions and that the decision by consumers not to engage with the online course in which they had enrolled, not to withdraw prior to the census date, and not to respond to contact initiated by the College, was conduct of the consumer not the College.
184 We reject that submission because it ignores the relevant facts and circumstances including, most importantly, the effect of the College's decision to change its enrolment process in a manner that foreseeably, indeed inevitably, inflicted harm on students. The College participated in, and sought to profit from, the VFH scheme, by which the College supplied VET courses to students and was paid by the Commonwealth. As detailed earlier in these reasons, the evidence shows that the College's participation in the VFH scheme in respect of its online campus and using external agents to recruit students gave rise to a known risk of agent misconduct and the enrolment of unwitting and unsuitable students, and that risk regularly materialised.
185 It is unnecessary to make a finding as to whether and to what extent such students were suffering from a "special disadvantage". As explained in Quantum, the prohibition in s 21 of the ACL is not confined to the taking advantage of a special disadvantage within the equitable principles. The amendments that were made to the VFH scheme in 2012 had the aim of broadening the demographic of students who qualified for assistance through the scheme in order to address low participation rates from identified demographic groups including Indigenous Australians, people from non-English speaking backgrounds, with disability, from regional and remote areas, from low socio-economic backgrounds, and people not currently engaged in employment. It can be readily inferred from the totality of the evidence that many recruitment agents targeted the above identified demographic groups and that many of the College's disengaged students were within those demographic groups. However, that is not a critical fact. What is critical is the College's awareness of the problem of agent misconduct and unwitting and unsuitable student enrolments, which was present at the College's online campus in large numbers.
186 Despite knowing the risks and problems that arose from the VFH scheme and which were present at the College's online campus in large numbers, the College decided to change its enrolment process to remove two principal safeguards against that risk. It did so because agents were referring students elsewhere as a result of the College's safeguards and the College's enrolments and revenue were declining. It did so in consultation with agents to increase revenue. In doing so, it knew or ought to have known what the effect would be: a large increase in enrolments and a large increase in the enrolment of unwitting and unsuitable students who would incur VFH debts. These were persons being enrolled in the online campus in circumstances where the person did not do so willingly and with full knowledge of the obligation being incurred or where the person is unsuitable for enrolment because they lack sufficient language, literacy or numeracy skills or technology skills or access. The appellants' submission on this appeal, that those persons should have looked after themselves and taken responsibility for their own decisions, reflects the same disregard of the interests of students as was evident in its original decision to change its enrolment process. In our view, the primary judge was correct to conclude that the College's decision was unconscionable.
187 The appellants submitted that the prohibition of unconscionable conduct requires an assessment of the impugned conduct, and whether it involves a sufficient departure from the required norms or standard of commercial behaviour. The appellants argued that a comparison of the College's conduct at one point in time to a later point in time tells one little about whether either category of conduct is outside of societal norms of acceptable commercial behaviour. That submission was made to the primary judge and his Honour explained that the ACCC's case was not based on a mere comparison between the College's processes at different points in time (at PJ [529]-[530]). As explained by the primary judge, the College's conduct at an earlier point in time was significant because it addressed the known risks and problems in the VFH scheme in a manner that protected students. The change in the College's conduct was a deliberate decision to remove those safeguards, thereby increasing the risk of harm to students. The chronology of events showed that the College made the decision to change its enrolment process in order to increase revenue, knowing the foreseeable and likely consequences of its decision and the harm that would be occasioned students. The conduct can be rightly judged as unconscionable.
188 Relying upon paragraphs (g) and (h) of s 22, the appellants submitted that, instead of comparing the impugned conduct with the College's enrolment processes before the change, the primary judge ought to have compared the impugned conduct with "compliance with industry regulation". The appellants argued that the Department had identified the same risks and introduced a regulatory response that included banning inducements, requiring RTOs to have written agreements with their sales agents, and requiring that those agreements contain particular terms concerning agents' conduct and the monitoring of agents by VET providers. The appellants submitted that the College complied with the regulatory scheme, and the regulatory framework in 2015 did not mandate either an outbound QA call or the campus driven withdrawal policy to address the identified risks.
189 We reject those submissions. They misstate the effect and relevance of paragraphs (g) and (h) of s 21. Each of those paragraphs are concerned with compliance with "industry codes", not industry regulation at large. The expression "industry code" is defined in s 2 of the ACL as having the same meaning as in s 51ACA of the CCA. Section 51ACA is in Pt IVB of the CCA, which Part provides for the enforcement of industry codes. An industry code is defined as a code regulating the conduct of participants in an industry towards other participants in the industry or towards consumers in the industry. There was no evidence of any industry code in the VET sector. At a general level, it may be accepted that compliance with industry regulation is a relevant consideration in assessing whether commercial behaviour is unconscionable. However, compliance must be regarded as the norm, such that non-compliance might be a factor indicating that conduct is unconscionable. The mere fact of compliance with industry regulation does not lead to a conclusion that the conduct is not unconscionable, as observed by the primary judge (at PJ [518]). There is a further point. In August 2015, before the change was made, the Department published a further update to the Addendum to the booklet titled VET Administrative Information for Providers. The update included frequently asked questions about student withdrawals and stated the Departments' expectation "that if students could not be contacted and/or they had not participated in the unit before the census date, a provider would cancel the enrolment to avoid the student incurring the debt". The College's changed enrolment process failed to comply with that expectation.
190 The primary judge addressed the appellants' arguments concerning compliance with the VET Guidelines and the HES Act at PJ [518]-[519]. The primary judge correctly observed that, if particular conduct is not against the rules (that regulate the conduct), that may be relevant in the evaluative judgment with regard to unconscionability, but it is not determinative. It is clear that the primary judge took that matter into account in his decision. The primary judge also observed that the VET Guidelines proscribed any barriers to withdrawal and that an absence of awareness by a consumer that they have been enrolled or that they can withdraw is a barrier to withdraw. His Honour considered that it could be inferred that enrolled students who had not accessed the learning management system and were uncontactable were not aware of their enrolment or, if they were aware, did not know that they could withdraw before the first census date. His Honour considered that, in those circumstances, abolishing campus driven withdrawals represented a barrier to withdrawal. Respectfully, we do not agree that the abolition of the campus driven withdrawal can be characterised as a barrier to withdrawal within the meaning of the VET Guidelines. As such, the impugned conduct should not be understood as breaching any regulatory obligation relating to the VFH scheme. However, in our view, that conclusion does not have any material effect on the primary judge's evaluation of the conduct. As already noted, paragraphs (g) and (h) of s 22(1) concern industry codes, not regulatory obligations more generally. Further, although the abolition of campus driven withdrawals was not, in our view, in breach of the VET Guidelines, it was contrary to the guidance provided in the Department's August 2015 update to the Addendum to the booklet titled VET Administrative Information for Providers.
191 Relying upon paragraph (e) of s 22(1), the appellants submitted that it was relevant to consider the circumstances under which a student could have acquired identical or equivalent goods or services from a person other than the College and that the ACCC led no evidence about the enrolment processes of other RTOs. The appellants also noted that the primary judge rejected evidence of the withdrawal policies of other RTOs tendered by the College and made no finding that students could acquire equivalent services on different terms. For the following reasons, the submission does not demonstrate appellable error in the primary judge's conclusion. First, there was no evidence before the Court as to the enrolment processes of any other RTO, including their terms and conditions with respect to withdrawing from a course. Thus, the primary judge could not make any finding with respect to the matters referred to in paragraph (e) of s 21. Second, while the primary judge refused the College's tender of the withdrawal policies of other RTOs, that refusal has not been raised as a ground of appeal. Third, and as found by the primary judge, in the circumstances of the present case the matters referred to in paragraph (e) of s 22(1) had limited relevance to the assessment of unconscionability. That is because the conclusion of unconscionability did not arise merely from the circumstances of the College's enrolment process. If the College had never experienced, and was unaware of the risk of, agent misconduct or the risks of unwitting and unsuitable students being enrolled, the College's enrolment process may not have involved unconscionable conduct. If the College's agents were highly ethical and the risk of enrolment of unwitting and unsuitable students was remote or theoretical, it may not have been unconscionable for the College to have an inbound QA call process and not to have a campus driven withdrawal process. It follows that evidence concerning the withdrawal policies of other RTOs has little, if any, bearing on the assessment of the College's enrolment process. That is particularly so when nothing is known of the experience of other RTOs with agent misconduct or the enrolment of unwitting or unsuitable students, or other safeguards such RTOs may have had in their enrolment processes.
192 For those reasons, we reject appeal ground 1.