PENALTIES
45 I should first deal with Mr Vaysman's submission that the sentence imposed was manifestly excessive. Effectively, the submission is based upon two propositions: first, that the Court should be guided by earlier sentences; and second, that a consideration of such sentences indicates that the period of imprisonment in this case should have been substantially less than three years. The starting point for this argument is said to be the decision of the High Court in Hili v The Queen (2010) 242 CLR 520 at [54] - [55] where the majority said:
54. In Director of Public Prosecutions (Cth) v De La Rosa … , Simpson J accurately identified the proper use of information about sentences that have been passed in other cases. As her Honour pointed out … , a history of sentencing can establish a range of sentences that have in fact been imposed. That history does not establish that the range is the correct range, or that the upper or lower limits to the range are the correct upper and lower limits. As her Honour said … : "Sentencing patterns are, of course, of considerable significance in that they result from the application of the accumulated experience and wisdom of first instance judges and of appellate courts." But the range of sentences that have been imposed in the past does not fix "the boundaries within which future judges must, or even ought, to sentence" … . Past sentences "are no more than historical statements of what has happened in the past. They can, and should, provide guidance to sentencing judges, and to appellate courts, and stand as a yardstick against which to examine a proposed sentence" … (emphasis added). When considering past sentences, "it is only by examination of the whole of the circumstances that have given rise to the sentence that 'unifying principles' may be discerned" … .
55. As the plurality said in Wong … :
"[R]ecording what sentences have been imposed in other cases is useful if, but only if, it is accompanied by an articulation of what are to be seen as the unifying principles which those disparate sentences may reveal. The production of bare statistics about sentences that have been passed tells the judge who is about to pass sentence on an offender very little that is useful if the sentencing judge is not also told why those sentences were fixed as they were."
Their Honours also said at [59] - [60]:
59. As was said in Dinsdale v The Queen … , "[m]anifest inadequacy of sentence, like manifest excess, is a conclusion". And, as the plurality pointed out … in Wong, appellate intervention on the ground that a sentence is manifestly excessive or manifestly inadequate "is not justified simply because the result arrived at below is markedly different from other sentences that have been imposed in other cases". Rather, as the plurality went on to say … in Wong, "[i]ntervention is warranted only where the difference is such that, in all the circumstances, the appellate court concludes that there must have been some misapplication of principle, even though where and how is not apparent from the statement of reasons". But, by its very nature, that is a conclusion that does not admit of lengthy exposition. And, in the present matters, the Court of Criminal Appeal, having described the circumstances of the offending and the personal circumstances of the offenders, said … that "the sentence imposed in these matters is so far outside the range of sentences available that there must have been error".
60. The Court of Criminal Appeal also said … that "manifest error is fundamentally intuitive". That is not right. No doubt, as the Court went on to say … , manifest error "arises because the sentence imposed is out of the range of sentences that could have been imposed and therefore there must have been error, even though it is impossible to identify it". But what reveals manifest excess, or inadequacy, of sentence is consideration of all of the matters that are relevant to fixing the sentence. The references made by the Court of Criminal Appeal to the circumstances of the offending and the personal circumstances of each offender were, therefore, important elements in the reasons of the Court of Criminal Appeal.
Heydon J dealt with this issue in rather more detail at [77] - [79] as follows:
77. Sentences must be reasonably consistent. But it does not follow that disparities between them may not exist. Within the boundaries of reason, and leaving aside the special instance of co-offenders, where marked disparity renders sentences vulnerable on appeal … , it cannot be said that any particular disparate sentence is necessarily wrong merely because it is disparate. Indeed, even within a single jurisdiction, one court, while bound by whatever this Court or the intermediate appellate court for that jurisdiction has held to be the correct legal principles (statutory or common law), may arrive at sentencing results in particular cases which are different from those reached by earlier courts in that jurisdiction without being open to appellate reversal or criticism for "error" merely because of those differences.
78. Thus two courts may arrive at different sentences because the later court considers the first to have erred, not in relation to the identification of legal principle, but in relation to factual reasoning or in relation to the exercise of discretionary judgment. It is open to a later court (whether an intermediate appellate court or a trial court) to depart from the sentencing conclusion of an earlier intermediate appellate court or trial court even though the circumstances seem indistinguishable. It is open for the later court to do this simply because the later court thinks that the earlier court erred in fact: in that event the circumstances become distinguishable. It is also open for the later court to do this merely because it thinks the earlier court erred in the exercise of discretionary judgment - that is, arrived at a sentence which the later court, accepting the correctness of the legal principles stated, the facts found and the considerations taken or not taken into account by the earlier court, considers nonetheless to be too high or too low. The later court's liberty to differ from the sentencing conclusion reached by the earlier court does not exist only where it thinks the earlier court to be plainly wrong. It exists where the later court thinks the earlier court's conclusion to be merely wrong. Indeed it exists even where the later court does not think the earlier court's conclusion to be "wrong", but just disagrees with it. The liberty of the later court continues even if more than one earlier court has reached a conclusion with which the later court disagrees. Even after a court carrying out the difficult obligation of sentencing has identified the correct legal principles, found the facts correctly, taken into account all relevant considerations and excluded all irrelevant considerations, the court is left with a field in which to exercise a discretionary judgment. It is no doubt right for a sentencing court to examine what has happened in cases similar to the one under consideration. And it is no doubt reasonable for a sentencing court to behave with humility in reading the opinions of other judges in earlier cases who may be abler, better qualified, more learned, or more experienced. But in exercising its discretionary judgment, the primary duty of a sentencing court is to be true to its own perception of what degree of severity or leniency is appropriate.
79. If the position were otherwise, a later court would be compelled to impose sentences on offenders which it thought to be too harsh or too lenient merely because earlier courts had followed that path, even though the question whether a sentence should be heavy or light is not a question of law. This would be a novel application of the doctrine of precedent. For a "sentence itself gives rise to no binding precedent. What may give rise to precedent is a statement of principles which affect how the sentencing discretion should be exercised" … .
46 At the sentencing hearing, counsel for Deckers provided Tracey J with a schedule containing 25 cases. However very few of them involved sustained contempt over a lengthy period, which is the most troubling feature of Mr Vaysman's conduct. Many of the cases involved failure to take action in accordance with a court order rather than involvement in conduct which was proscribed by a relevant order. To act is not necessarily more serious than to fail to act, but action frequently bespeaks deliberate defiance, whereas failure to act may only bespeak neglect or insouciance. Of the cases to which Tracey J was referred, the following may offer some assistance.
ASIC v Reid (No 2) [2006] FCA 700;
APRA v Siminton (No 10) [2007] FCA 1814; on appeal Siminton v APRA [2008] FCAFC 90;
ACCC v Levi (No 3) [2008] FCA 1586; and
Jones v Toben (No 2) [2009] FCA 477.
Each involved conduct which was both in contempt and otherwise contrary to statute. Each involved repeated misconduct over a relatively long period of time.
47 The conduct in Reid involved managing a corporation whilst prohibited from doing so by a court order. In 1992, Jenkinson J had ordered that Reid be so prohibited until 10 August 2036. At first blush one might wonder about the utility of such an order, but I assume that the relevant conduct justified it. In June 2006, Lander J dealt with Reid for contempt of that order. It was the third occasion on which he had been dealt with for contempt of the order. In 2002 Kenny J had imposed a fully suspended term of imprisonment for 12 months. His subsequent contempt occurred during the period of suspension. Lander J considered his contempt to be contumelious and sentenced him to imprisonment for nine months. He had already been in prison for a period of between two and three months, so that the effective sentence was one year.
48 A person who manages a corporation whilst disqualified from doing so, commits an offence against the Corporations Act 2001 (Cth) (the "Corporations Act"). In 2003, the maximum penalty prescribed by s 206A of the Corporations Act for that offence was one year's imprisonment.
49 Reid's conduct reflected a degree of persistence in offending over some years, but, as far as the evidence went, it occurred in relatively short bursts. That may have been because his conduct was detected and action taken against him. There is no suggestion that others suffered as the result of his conduct. He had previously been imprisoned, probably for serious fraud. The previous suspended sentence imposed by Kenny J was obviously a serious aggravating factor.
50 In Siminton, Tracey J dealt with contempt of interlocutory orders restraining Siminton from operating on certain bank accounts. The principal proceedings appear to have alleged breaches of s 7 of the Banking Act 1959 (Cth). That section forbade any person from carrying on the business of banking without the relevant statutory authority. The interlocutory relief appears to have been designed to protect the subject matter of the proceedings rather than to prevent further breaches of the statute. The relevant breaches occurred over a five month period. Siminton had previously been sentenced to 10 weeks' imprisonment for similar misconduct. He was, at the time of the contempt, an undischarged bankrupt. Tracey J concluded that Siminton's conduct was contumacious and aggravated by the fact that he had been previously dealt with for similar contemptuous conduct. His Honour sentenced Siminton to 12 months' imprisonment. In Siminton v APRA [2008] FCAFC 90, the Full Court upheld the finding of contempt. There appears to have been no appeal against the sentence.
51 In ACCC v Levi (No 3) [2008] FCA 1586 McKerracher J dealt with multiple counts of contempt constituted by conduct in breach of final orders of the Court made in proceedings alleging breaches of ss 51A and 52 of the Trade Practices Act. The conduct in those proceedings involved misleading or deceptive conduct in the sale of businesses. On 28 February 2005, Keifel J made orders, by consent, restraining Levi from seeking to sell businesses other than in certain prescribed circumstances, obviously designed to bring his previous misconduct to the notice of any potential purchaser. In breach of those orders, between 5 March 2005 and 27 May 2005, he advertised six different businesses for sale. Between May 2005 and October 2006 he placed at least 126 advertisements for the sale of businesses. The contempt proceedings were confined to transactions with five people who had responded to his advertisements. Levi had responded to prior warnings from ACCC in a belligerent, aggressive and arrogant way. He subsequently pleaded "guilty" to the contempt charges. It seems that each "purchaser" lost a significant sum of money.
52 Levi had a criminal history for fraud offences and had served a number of periods of imprisonment. On three occasions he sought, unsuccessfully, to delay the hearing of the contempt proceedings. On 30 May 2008, he indicated that he would plead "guilty". The motion for committal had been filed on 13 June 2007. Levi's indication of his intention to plead was given 10 days before the scheduled trial date. Until that time he had indicated that he would require all witnesses for cross-examination. The matter was substantially ready for trial. Further, as late as 7 May 2008, Levi was still seeking to sell businesses. He expressed no contrition or remorse and made no reparation.
53 McKerracher J gave "reasonable, not negligible" weight to an apology offered at the hearing, and his "submission to the jurisdiction of the Court", presumably by his plea. There was psychological evidence which suggested that Levi suffered from depression.
54 ACCC suggested a range of two to three years' imprisonment. His Honour adopted the lower end of the range as his starting point, and then made deductions to recognize the late plea, Levi's age and his medical condition. In the result he was sentenced to 10 months' imprisonment to be released upon his having served four months, the balance being suspended for five years on conditions.
55 The decision in Toben is presently relevant by virtue of the fact that the contemptuous conduct occurred over a period of seven months, and on numerous occasions. Further, the relevant complainant conceded that the public interest in punishment exceeded his personal interest, leaving the question of penalty to the Court. Numerous circumstances of aggravation arose out of Toben's conduct after the commencement of the contempt proceedings, and in connection with those proceedings.
56 One significant difference between the present case and Toben is that Toben appears to have had no commercial motive. His conduct appears to have been based on a perverse refusal to accept either community standards of behaviour, or the jurisdiction of the Court, at least to the extent that either limited his capacity to advance his plainly silly views. In describing those views as "silly", I do not mean to detract from the seriousness of his misconduct, either to the extent that it was contrary to the Racial Discrimination Act 1975 (Cth) or in contempt of this Court. Having said that, however, and notwithstanding the offensive nature of his conduct, it is a mark of a liberal democracy that the expression of a wide range of views is tolerated. Where there are statutory limits upon the right to express such views the Court may err on the side of caution in fixing a custodial sentence. It may seek to avoid imposing a sentence which might unduly deter expressions of unpopular opinions. The Court may also seek to avoid any risk that the offender will be seen as a political martyr.
57 In the course of the hearing of the appeal, the Court referred to three more recent cases. The first was the decision of Martin CJ in Corruption and Crime Commission v Allbeury (No 2) [2011] WASC 26. In that decision his Honour dealt with a number of persons for contempt of the Corruption and Crime Commission. Each had refused repeatedly to be sworn or affirmed as a witness. In previous cases sentences of imprisonment for one to two years had been imposed in connection with contempt involving refusal to answer questions. His Honour considered it relevant that the contempt occurred in the context of an investigation into organized crime. Martin CJ considered that the seriousness of the offences dictated that he should commence his consideration of penalty at the upper end of the "range" demonstrated by the cases. His Honour passed sentences ranging from two years to two years and three months.
58 The second case is the decision of Pembroke J in Ronowska v Kus (No 2) [2012] NSWSC 817. In the course of proceedings for equitable compensation, it was ordered that Ronowska pay certain moneys into a solicitor's trust account, presumably pending the outcome of the proceedings. In breach of that order he disbursed the money and misled the Court in order to conceal such breach. His Honour referred to other cases (including Allbeury) which cases, his Honour considered, indicated imprisonment for a period within the range of six months to two years and three months. His Honour imposed a penalty of 18 months' imprisonment. In R v Mahir El Kholed [2009] QSC 335 Wilson J imposed a sentence of 14 months' imprisonment recommending release on parole after two months. The offence was failing to appear in answer to a subpoena in a murder trial. Both the sentence and the non-parole period were reduced to reflect the fact that El Kholed had been on remand for 118 days.
59 In his written submissions counsel suggested that the sentence imposed on Mr Vaysman was three times greater than any earlier sentence for contempt of this Court. If that be so, then the cases to which I have referred suggest that this Court's punishments are out of step with those in other jurisdictions. If so, then we should take this opportunity to correct the discrepancy.
60 Section 132AD of the Copyright Act provides that a person who manufactures an article in breach of a copyright is, if convicted on indictment, liable to imprisonment for up to five years. The current proceedings are not on indictment, but that matter is irrelevant for present purposes. Quite apart from anything else, contempt of court is not an offence against a law of the Commonwealth for the purposes of s 80 of the Constitution. See Re Colina; ex parte Torney (1999) 200 CLR 386 at [16], per Gleeson CJ and Gummow J, Hayne J concurring. To the extent that it is otherwise appropriate to take into account the maximum sentence for an offence against the Copyright Act, there is no reason to refrain from doing so simply because the relevant offence is to be tried on indictment.
61 As to the relevance of such a penalty to proceedings for contempt, in Slade (supra) Wall LJ considered that in punishing for contempt, a court does not punish for the "criminal equivalent of what the contemnor has done". However his Lordship also considered that any sentence for contempt should not be "manifestly discrepant" with sentences passed in criminal proceedings for comparable offences. Although one might read these propositions as being mutually inconsistent, it seems unlikely that his Lordship considered them to be so. It seems probable that Wall LJ meant that, although the court was to sentence for contempt rather than any criminal offence involving the same conduct, the criminal penalty might still give some guidance as to the appropriate penalty for the contempt.
62 It may well be difficult, in sentencing for contempt, to justify a sentence longer than the maximum sentence fixed for similar conduct which also breaches some other law. As Martin CJ observed in Allbeury, contempt occurs in the context of court proceedings, or similar proceedings in other tribunals. Some such proceedings are more important to the public than are others. His Honour considered it relevant that the contempt in question occurred in the context of an investigation into organized crime Where, apart from contempt proceedings, the conduct attracts a prescribed penalty, that penalty may indicate Parliament's view as to the extent of the public interest in preventing the conduct in question. At the very least such a maximum penalty may suggest a maximum level of sentence for contempt, absent special circumstances. As Wall LJ suggested it is a matter of proportionality.
63 Mr Vaysman's persistent and blatant contempt for Deckers' rights and the Court's authority must not be under-estimated. There seems to have been virtually no break in Mr Vaysman's activities between the resolution of the 2003 proceedings and the end of 2007. His business undertaking was no cottage industry. He maintained both factory and warehouse premises. He set up a distribution network and sought to maintain distribution, notwithstanding the 2007 proceedings. There can be no doubt that his motivation was commercial, as was the scale of his operation. Neither the Court's orders, nor Decker's demonstrated determination to protect its intellectual property and common law rights deterred him from pursuing his self-interest. There is also little doubt that large amounts of money flowed into, and out of the business undertaking.
64 His lack of co-operation in the conduct of these proceedings demonstrates an absence of remorse. Even at the hearing of this appeal, only the most perfunctory of apologies was offered through counsel. There can be little doubt that Mr Vaysman left Australia to avoid the consequences of the contempt proceedings, thus extending the duration of Deckers', and the Court's involvement in this matter until the present time, more than 10 years after the commencement of the 2003 proceedings.
65 In my view these factors make this contempt much more serious than those which were dealt with in the cases to which I have referred. Were it not for the complication raised by the award of additional damages, I would have upheld the primary Judge's sentence of three years' imprisonment. In so doing I would have recognized the apparently higher levels of sentencing in New South Wales, Queensland and Western Australia as compared to those identified in previous decisions of this Court. In both the Queensland case and the Western Australia case, the principal consideration was the public interest in the administration of justice. However neither case involved the blatant persistence in contemptuous conduct and the commercial motivation for such conduct which are evident in this case.
66 Besanko J left the sentences, other than that for count 18, intact, and to be served concurrently with any sentence on that count. I propose to adopt the same approach. Thus the length of the sentence on count 18 will determine the actual period of imprisonment. The primary issue is the extent to which the award of additional damages should be reflected in the sentence on count 18. Mr Vaysman does not submit that such award raises a bar to any further punishment. He submits only that it should be taken into account in fixing any further punishment.
67 It seems likely that some part of the award of additional damages related to copyright infringements which occurred prior to commencement of the 2003 proceedings. Such infringements would not have been in contempt of any order or undertaking. Some aspects of Mr Vaysman's contemptuous conduct constituted causes of action other than for copyright infringement. The award of additional damages did not relate to those aspects. Punishment for contempt is partly designed to vindicate private interests. In this case, that purpose has, at least in part, been satisfied by the award of additional damages. As I have pointed out, neither the decision in Allbeury nor that in El Kholed involved any significant private interest. In my view the more serious aspects of this case, as compared to Allbeury may reasonably be set off against the need to recognize the punishment inherent in the award of additional damages. On count 18, I would impose a sentence of imprisonment for two years and three months.