Case: NW Frozen Foods Pty Ltd v Australian Competition and Consumer Commission [1996] FCA 1134 ; (1996) 71 FCR 285
Outcome: considered
I will revert to this matter specifically when dealing with the proposed pecuniary penalty, I should emphasise at the outset, and the parties themselves acknowledge, that the Court retains the responsibility for imposing penalties and for making orders, the parties' agreement notwithstanding. That responsibility derives ultimately from s 71 of the Constitution and cannot be circumscribed by private agreement: see Australian Competition and Consumer Commission v Real Estate Institute of Western Australia Inc [1999] FCA 18 ; (1999) 161 ALR 79 at [18] . This said, the Court has long recognised the propriety of encouraging fair and appropriate settlements so reducing the burden of litigation on public and private resources: see eg Australian Competition and Consumer Commission v Econovite Pty Ltd [2003] FCA 964 at [11] ; NW Frozen Foods Pty Ltd v Australian Competition and Consumer Commission [1996] FCA 1134 ; (1996) 71 FCR 285 at 290-291. CONSIDERATION The Declarations Sought I have referred already to the requirements of s 76(1) and to the considerations it includes amongst matters relevant for the Court to have regard to in determining an appropriate pecuniary penalty. I need not repeat them. Additionally, a considerable body of authority has enlarged upon the principles governing the imposition of pecuniary penalties. Those principles were helpfully distilled by Kenny J in Australian Competition and Consumer Commission v TEAC Australia Pty Ltd [2007] FCA 1859 at [16] . Her Honour there said: "The relevant principles governing the imposition of pecuniary penalties are discussed in Australian Consumer and Competition Commission v Dataline.Net.Au Pty Ltd [2007] FCAFC 146 at [60] - [75] ; Trade Practices Commission v CSR Ltd (1991) ATPR 41-076 at 52,151-52, 154; NW Frozen Foods Pty Ltd v Australian Consumer and Competition Commission [1996] FCA 1134 ; (1997) 71 FCR 285 at 290-295; J McPhee &amp; Son (Aust) Pty Ltd v Australian Consumer and Competition Commission [2000] FCA 365 ; (2000) 172 ALR 532 ; and Minister for Industry, Tourism and Resources v Mobil Oil Australia Pty Ltd [2004] FCAFC 72 at [51] - [58] . These authorities indicate that further relevant matters include: (a) the size of the contravening company; (b) the degree of power the company has, as evidenced by its market share and ease of entry into the market; (c) whether the conduct was systematic, deliberate, or covert; (d) the period over which the conduct occurred; (e) the effect on the functioning of the market and other economic effects of the conduct; (f) whether the contravention arose out of the conduct of senior management or at a lower level; (g) whether the company has a corporate culture conducive to compliance with the Act, as evidenced by educational programs and discipline, or other corrective measures in response to an acknowledged contravention; and (h) whether the company has shown a disposition to co-operate with the authorities responsible for the enforcement of the Act in relation to the contravention. See also Australian Consumer and Competition Commission v Jurlique International Pty Ltd [2007] FCA 79 at [51] ; Australian Consumer and Competition Commission v Knight [2007] FCA 1011 at [70] ; and Australian Consumer and Competition Commission v Visy Industries Holdings Pty Limited (No 3) [2007] FCA 1617 at [303] ." Before analysing the circumstances revealed in this matter in light of the considerations and principles referred to in s 76(1) and in the above extract, it is appropriate to note the observations of Burchett and Kiefel JJ in the Full Court in NW Frozen Foods . Having referred to the "unity" in the case law affirming the public interest in the promotion of settlements, especially in this area where litigation is likely to be very lengthy, their Honours observed (at 298-299): "We agree with the statement made in several of the cases cited that it is not actually useful to investigate whether, unaided by the agreement of the parties, we would have arrived at the very figure they propose. The question is not that; it is simply whether, in the performance of the Court's duty under s 76 , this particular penalty, proposed with the consent of the corporation involved and of the Commission, is one that the Court should determine to be appropriate." In considering the appropriateness of the proposed quantum of pecuniary penalty it is necessary to have regard to the various considerations to which I have referred above and to which I now turn. (i) The nature and extent of the contravening conduct and the circumstances in which it took place: s 76(1) The contravening conduct was born of Mr Fields' decision in August 2004 and was thereafter implemented in all of its dealership agreements until revoked at the end of 2007. It was directed at all of Hobie's sail boat and kayak dealers across Australia. It was the product of the unilateral action of Mr Fields which was taken without legal advice. Its documentary expression was clear and unequivocal in its purport: Hobie did not want its dealers to discount Hobie products. (ii) The amount of loss or damage occasioned: s 76(1) While the parties have provided me with a list of the pecuniary penalties imposed in cases dealing solely with s 48 contraventions for the period 1996 to 2007, I would have to say that "the parity principle" has yielded little by way of direct assistance. Such is not uncommon in cases concerned with TP Act contraventions: cf the observations of Burchett and Kiefel JJ in NW Frozen Foods at 295.