Case: Australian Competition and Consumer Commission v IPM Operation and Maintenance Loy Yang Pty Ltd (No. 2) [2007] FCA 11
Outcome: referred to
The CEPU contested the allegations made against it. The proceeding, in so far as it involved allegations against the CEPU, went to trial before Young J. On 19 December 2006 his Honour made orders declaring that the CEPU had been an accessory to the contraventions, by Edison, of ss 45E(3) and 45EA of the Act . His Honour further ordered that the CEPU be restrained for a period of three years from engaging in any repetition of such conduct directed to Edison: see Australian Competition and Consumer Commission v IPM Operation and Maintenance Loy Yang Pty Ltd [2006] FCA 1777. Having heard further submissions relating to the quantum of penalty and costs his Honour, on 16 January 2007, ordered that the CEPU pay a penalty of $125,000 and costs of $200,000: see Australian Competition and Consumer Commission v IPM Operation and Maintenance Loy Yang Pty Ltd (No. 2) [2007] FCA 11. The CEPU has lodged an appeal against his Honour's decision. The appeal grounds challenge his Honour's findings in relation to liability and penalty. 11 Initially, I was concerned that the imposition of a monetary penalty on Edison which was only slightly less than that imposed on the CEPU might not be in accord with the parity principle having regard to the finding of Young J that the CEPU was the instigator of the offending conduct and that the CEPU could not claim the benefit of any discount by reason of any cooperation with the ACCC's investigation or an early willingness to acknowledge liability. However, having heard argument on the point, I was persuaded that the imposition of a penalty of $120,000 on Edison would not contravene the parity principle. I have come to this view having regard to a number of factors. The first is that the CEPU was penalised as an accessory rather than a party principal. Moreover it was penalised in respect of a single course of conduct which extended over two weeks: see [2007] FCA 11 at [40] - [41] , [50]. Edison, on the other hand, committed two separate contraventions of the Act , one under s 45E and the other under s 45EA. The contravention of s 45E occurred when Edison, in August 2001, entered into the agreement with the CEPU. The contravention of s 45EA , which occurred when Edison gave effect to the agreement, involved conduct undertaken over a period of more than two years (21 August 2001 until 20 November 2003). 12 The nature of the contravening conduct to which Edison has admitted and the circumstances in which it occurred appear from the passages in the agreed statement of facts extracted above at [5]. The demand, by the CEPU, which led to the making of the offending agreement, was made at a time when Edison was peculiarly susceptible to industrial pressure by reason of pressing commercial imperatives. The principal victim of the agreement was DJN. It was unable to obtain work from Edison at the Loy Yang site for over two years. Edison was deprived of the option of engaging DJN and any other subcontractors who did not have certified agreements with the CEPU. It is not possible to quantify the losses sustained by DJN and Edison which were caused by the agreement. Those losses do not appear to have been significant in monetary terms. 13 It is necessary, in fixing an appropriate penalty, to have regard to the need to deter other companies from engaging in similar conduct. In my view a penalty of the magnitude proposed serves this purpose.