Case: Comcare v Commonwealth of Australia [2007] FCA 662 ; [2007] 163 FCR 207
Outcome: applied
overriding principle in assessing penalty is that the amount of the penalty should reflect the Court's view of the seriousness of the offending conduct in all the relevant circumstances: Madgwick J in Comcare v Commonwealth of Australia [2007] FCA 662 ; [2007] 163 FCR 207 at [120] . While penalties imposed pursuant to s 16(1) in other cases may provide some guidance, the Court in each case is required to focus on the circumstances before it and not be improperly distracted by the circumstances in other cases which are inevitably different from the circumstances before the Court. As Gray J said in Australian Ophthalmic Supplies Pty Ltd v McAlary -Smith [2008] FCAFC 8 ; [2008] 165 FCR 560 at [12] - [13] : [12] Much of the argument put by counsel for the appellant involved a detailed comparison between the facts of this case and the facts of two other cases in which lower penalties had been imposed in respect of award breaches. The two cases, both judgments of the same Federal Magistrate, are Mason v Harrington Corporation Pty Ltd [2007] FMCA 7 and Flattery v The Italian Eatery T/as Zeffirelli's Pizza Restaurant [2007] FMCA 9. This was a fundamentally wrong approach. Penalties are not a matter of precedent . The choice of penalty must be dictated by the individual circumstances of a case, not by a line by line comparison with another case. See the passage from the judgment of Burchett and Kiefel JJ in NW Frozen Foods Pty Ltd v Australian Competition and Consumer Commission [1996] FCA 1134 ; (1996) 71 FCR 285 at 295, set out in the reasons for judgment of Buchanan J at [87]. [13] Penalty decisions in other cases can be of value in demonstrating that there is a range of penalties generally considered appropriate to a particular type of case. The individual circumstances of the case at hand must then be examined, in order to determine at what point in the appropriate range the penalty should be set. This does not involve a comparison with the facts of other cases. (emphasis added) Some assistance in considering the appropriate level of penalty in circumstances involving breach of occupational health and safety standards can be found in comments of Madgwick J in Comcare v Commonwealth of Australia [2007] FCA 662 ; [2007] 163 FCR 207. In that decision his Honour took the view that the following considerations provided useful, analogical, general guidance in considering penalties under the Act: (i) the penalty must be such as to compel attention to occupational health and safety generally, to ensure that workers whilst at work will not be exposed to risks to their health and safety; (ii) it is a significant aggravating factor that the risk of injury was foreseeable even if the precise cause or circumstances of exposure to the risk were not foreseeable; (iii) the offence may be further aggravated if the risk of injury is not only foreseeable but actually foreseen and an adequate response to that risk is not taken by the employer; (iv) the gravity of the consequences of an accident does not of itself dictate the seriousness of the offence or the amount of penalty. However the occurrence of death or serious injury may manifest the degree of the seriousness of the relevant detriment to safety; (v) a systemic failure by an employer to appropriately address a known or foreseeable risk is likely to be viewed more seriously than a risk to which an employee was exposed because of a combination of inadvertence on the part of an employee and a momentary lapse of supervision; (vi) general deterrence and specific deterrence are particularly relevant factors in light of the objects and terms of the Act; (vii) employers are required to take all practicable precautions to ensure safety in the workplace. This implies constant vigilance. Employers must adopt an approach to safety which is proactive and not merely reactive. In view of the scope of those obligations, in most cases it will be necessary to have regard to the need to encourage a sufficient level of diligence by the employer in the future. This is particularly so where the employer conducts a large enterprise which involves inherent risks to safety; (viii) regard should be had to the levels of maximum penalty set by the legislature as indicative of the seriousness of the breach under consideration; (ix) the neglect of simple, well-known precautions to deal with an evident and great risk of injury, take a matter towards the worst case category; (x) the objective seriousness of the offence, without more may call for the imposition of a very substantial penalty to vindicate the social and industrial policies of the legislation and its regime of penalties. (at [120]) Submissions of the parties as to quantum of pecuniary penalty Comcare submits that an appropriate range for a penalty in this matter is $180,000-$210,000. It is for Comcare to demonstrate to the Court why the penalty sought is justified. The respondent has not proposed a dollar value or range of penalty to the Court. However the respondent submitted that, after taking into account the objective considerations which reflect upon the nature and qualify of the offence, and subjective factors favourable to the respondent, a discount of up to 25% be allowed on account of the early admission by the respondent. Pecuniary penalty seriousness of the offending conduct in all the relevant circumstances The respondent has made extensive submissions in relation to mitigation. As the respondent submits, and I also note, Madgwick J in Comcare v Commonwealth of Australia [2007] FCA 662 ; [2007] 163 FCR 207 listed no considerations favourable to a respondent in respect of assessment of penalty. However in determining a pecuniary penalty for breach of the Trade Practices Act 1974 (Cth), French J in Trade Practices Commission v CSR Ltd (1991) ATPR 41-076 at 52,153 considered issues subjectively relevant to the conduct of the respondent, including: