Trade Practices Commission v Allied Mills Industries Pty Ltd & Ors [1981] FCA 156

Federal Court of Australia|1981-07-01|Before: Sheppard J, Kitto J

Trade Practices ~ prosecution against five respondents for breaches of Part IV of Act - one respondent withdraws defence and submits to orders for penalty and injunction - matters upon which Court required to be satisfied - appropriateness of dealing with matter before conclusion

Trade Practices Commission v. Allied Mills Industries Pty. Limited and ors. '

NEW SOUTH WALES REGISTRY ) VV. G. No. 29 of 1979 GENERAL DIVISION j

On 14 September, 1981, I held that there was a case to answer against each of the respondents. The matter was stood over to 22 September, 1981. On that day senior counsel for the Commission and senior counsel for the fourth respondent, Hooker M11k Products Pty. Limited, otherwise known as Manildra Sugars, handed up a document which they

had signed. The document 1s in the following terms:-

Hooker Milk Products Pty. Limited (the fourth respondent) withdraws 1ts defence to this application.

Order that the fourth respondent be restrained for a period of three (3) years from this date from entering into, being a party to, or giving effect to any agreement arrangement or under- standing having the purpose or effect of fixing, maintaining or controlling the price of liquid glucose in contravention of the provisions of the Trade Practices Act 1974.

Order that the fourth respondent pay to the Commonwealth a penalty of $50,000.

Order that the fourth respondent pay one fifth of the Commission's costs of the proceedings to date including any reserved costs such one fifth share being assessed by consent in the sum of $60,000.

Order that any existing orders for costs made in interlocutory proceedings in this application in so far as such orders were made in favour of the Commission against the fourth respondent, or in favour of the fourth respondent against the Commission be vacated.

Exhibits tendered by the fourth respondent, or produced from its custody to be retained until further order.

Interest shall not run on the judgments for penalty and costs if the amounts are paid within 30 days, otherwise interest shall run from the date hereof.

These minutes shall be void if the Court shall decline to enter judgment in accordance with these terms."

I am asked to give effect to that document which I have

initialled and dated and placed with the papers. I would not

be prepared to take that course unless I was satisfied myself

The liability of a person to a penalty is imposed by

s.76 of the Trade Practices Act 1974 which relevantly provides

that if the Court is satisf1led that a person has contravened

a provision of Part IV of the Act the Court may order the person to pay to the Commonwealth such pecuniary penalty not exceeding $250,000, in the case of a body corporate, in respect of each act or omission by the person as the Court determines to be appropriate having regard to all relevant matters.

I must therefore be satisfied that the fourth respondent is in breach of the Act and that the amount of any penalty is appropriate in all the circumstances,

I have no hesitation in saying that I am satisfied of the breach. I have held there is a case to answer and the fourth respondent has, in paragraph 1 of the document referred to, withdrawn its defence.

As to penalty, it is necessary to bear in mind that the maximum penalty for which a corporation is liable under s.76 for any one breach of the Act is $250,000. Here, more than one breach 1s alleged and, by reason of the withdrawal of the defence, admitted, but it would not be appropriate to impose substantive penalties for each breach because each arises out of the one transaction, namely, the arrangement or understanding alleged in paragraph 12 of the amended statement of claim and the particulars appended thereto. That was the approach followed by Kitto J. in imposing penalties for breaches of the Customs Act, 1901, in L. Vogel and Son Pty. Limited v. Anderson (Minister for Customs)

(120 C.L.R. 157 at pp.164-165); compare what his Honour had said earlier about the seriousness of each of the offences,

The circumstances of the breach or breaches are set out in the judgment holding there was a case to answer, Neither the Commission nor the fourth respondent has put any further material before me on the question of penalty. Because the case against the remaining four respondents is proceeding, it is undesirable to say much about the appropriateness of the figure. I do say, however, that the case is by no means in the class of the worst cases one could imagine under the relevant section, s.45. In particular, there 1s no evidence to suggest that the public was affected very much, if at all, by what was done, and the evidence tends to establish that the arrangement or understanding had a comparatively short life, certainly no longer than three months and probably less. Thereafter, the respondent, which was apparently the leader in the intense competition which had prevailed throughout the first two-thirds of 1976, again found itself in competition with other suppliers. The evidence would also suggest that any arrangement or understanding of the kind alleged and admitted was not, during the period of operation which it had, always observed by the fourth respondent,

I am satisfied, having taken these matters into account and some other matters which I do not mention, that a penalty of $50,000 is proper and appropriate.

suggested to me by the agreement of the parties. Uninformed of their agreement, I may have selected a different figure, but I am satisfied that it would not have been very different from theirs. There is from time to time, amongst members of the profession and amongst the public, discussion concerning plea bargaining. Sometimes it is suggested that it involves disreputable conduct. It is my opinion that that 1s so if it at all implicates the Court in private discussions as to what

the Court's attitude will or would be likely to be if a particular course is taken. In this case nothing of that kind has occurred. The parties have made their own agreement and put it to the Court for approval, not knowing what its attitude was likely to be. That was the course adopted, perhaps in a less positive way, in a customs prosecution heard in the original jurisdiction of the

High Court; Chipp (Minister for Customs) v. Campbell

Beaumont Trading Pty. Limited (22 December, 1969, unreported).

The Court there accepted the parties! view of the matter. Thais, of course, is not a criminal case; the liability is civil only. But, even in the most serious criminal cases, it is not unusual for the prosecution to accept a plea to

a lesser charge, subject always to the approval of the Court.

I have said what I have only to explain that the course

which the parties have adopted is both proper and not uncommon, even though perhaps novel in the comparatively new field of trade practices.

The question arises, I suppose, as to whether I should do as the parties ask and enter judgment now. That is because the proceedings continue against the four remaining respondents who vehemently deny entering into any arrange- ment or understanding as is alleged in the amended statement of claim. I have asked counsel for each such respondent whether he has any obgection to my dealing with the matter now. No objection has been raised.

All things being equal, it 1s always important to bring litigation or any part of it to a conclusion as soon as possible. It 1s in the public interest that litigation should finish. That 1s specially so in a case such as this where the potential liability of each party for further costs is most substantial. It is true that the fourth respondent has not been continuously represented at the hearing but until the proceedings against it are over it will go on incurring costs in relation to having its legal advisers keep an eye on the case; and the Commission's costs in relation to the proceedings against it will con- tinue to accumulate until that case is over,

To a layman it may seem strange that one may admit to

being a party to an arrangement or understanding whilst the

others said to be parties to it deny participation in it. At one time it was thought that if two or more people were charged with conspiracy there could be no valid conviction of only one. The conviction of at

least two was required. So much was held by the Privy

Council as late as 1951 in Dahmasena_v. The King (1951) A.C. 1. But more recently the House of Lords has held

that there can be circumstances in which one only could be convicted; Director of Public Prosecutions v. Shannon (1975) A.C. 717. Lord Morris, in whose judgment Lord Reid agreed (p.744), distinguished rather than refused to

(and being relieved from referring to them all by the thoroughness of the review of the cases in the judgment of the Court of Appeal) I can now return to a closer examination of the problems which arise, It seems to be clear that in its development during the period when it was by the procedure in error that the validity of a conviction could be tested the law became dominated by the consideration

that an inconsistency on the record pointed to the conclusion that a conviction was wrong. If, however, on a Charge that A and B conspired with each other there are separate trials it may well happen that the available evidence at the trial of one of them is not the same as the available evidence at the trial of the other. If A is first tried the jury cannot convict unless on the evidence they are satisfied that he did conspire with B. That necessarily involves that the jury are satisfied that B conspired with A. But that conclusion of the jury for the purvoses of that trial cannot affect B or be evidence against B if and when he is later

"separately tried. If A has been fairly and properly tried with the result that on the evidence adduced he was properly convicted I see no reason why his conviction should be invalidated if for any reason B on his sub- sequent trial is acquitted. The reasons for the acquittal of B may have nothing to do with A. The circumstances that B's acquittal will result from the absence of proof of the case against him does not diminish the fact that he can fully assert that he has been cleared of the charges against him.

As I have earlier indicated I think that it as very desirable, where there is a charge of con- spiracy against A and B, that they should be tried together. If, however, for any reasons this cannot be, then if A pleads guilty or is found guilty I see no reason why his conviction must be set aside if B on his later separate trial is acquitted," It was submitted in argument 1n relation to there being no case that I should follow the Privy Council because it in some way bound me rather than the decision of the House of Lords. Reference was made to s.79 of the Judiciary Act 1903, But this Court has never been directly affected by decisions of the Privy Council in the sense of its decisions being open to appeal to it whether by way of the Hagh Court or not. Undoubtedly single gudges, if not Full Courts of this Court, would nevertheless feel themselves obliged to follow decisions of the Privy Council if there were no other relevant decision to be taken into account.

But where, as here, there is a conflacting decision of the

House of Lords, I think that this Court is free to choose.

Some may say it would be better for it to follow the

House of Lords, particularly if the decision of the House of Lords was more recent than that of the Privy Council. In any event, I prefer the House of Lords decision to that of the Privy Council.

In those circumstances it 1s appropriate to enter Judgment against one only of the respondents at this stage even though all others may well succeed in the defences which they have raised.

An additional order upon which the parties have agreed 1s the order for injunction in paragraph 2 of their document. I do not regard that order as punitive and I think it is more a matter for the parties to decide whether that is appropriate relief than was the case in relation to the penalty. In the circumstances I think 1t appropriate to grant such an ingunction and I propose to do so.

One of the submissions made during the argument on whether there was a case to answer was that the power con~ ferred upon the Court by s.80 of the Act to order an injunction was invalid. That was not a submission which I resolved when I delivered my judgment on 14 September, 1981. That left the question open. Since I must be satisfied, however, that I have jurisdiction to make the order which

the parties have asked me to make, it 1s necessary that I

decide that matter now. Having considered the arguments which were put, I have decided that s.80 is not invalid. My reasons for that decision will be published in due course.

The formal findings and orders which I make are as follows. I find the fourth respondent to have been 1n breach of the Trade Practices Act 1974 in the respects alleged against it in the amended statement of claim its defence to which has been withdrawn, a order that the fourth respondent pay to the Commonwealth a penalty of $50,000, I direct the entry of judgment accordingly. I order that the fourth respondent be restrained for a period of three years from this date from entering into, being a party to or giving effect to any agreement, arrangement or understanding having the purpose or effect of fixing, maintaining or controlling the price of liquid glucose in contravention of the provisions of the Trade Practices Act 1974, I order that the fourth respondent pay one-fifth of the Commission's costs of the proceedings to date including any reserved costs, such one-fifth share being assessed

by agreement in the sum of $60,000. I order that any

existing orders for costs made in interlocutory proceedings in this application in so far as such

orders were made in favour of the Commission against

the fourth respondent or in favour of the fourth respondent in favour of the Commission be vacated.

The exhibits tendered by the fourth respondent or produced from its custody are to be retained until further order. Interest shall not run on the amount of the order for penalty and costs, if the amounts are paid within 30 days. If they not be paid then, interest

At a glance

Court

Decision date

Before

Source

Judgment (62 paragraphs)