Case: NW Frozen Foods Pty Ltd v Australian Competition and Consumer Commission [1996] FCA 1134 ; (1996) 71 FCR 285
Outcome: referred to
NW Frozen Foods Pty Ltd v Australian Competition and Consumer Commission [1996] FCA 1134 ; (1996) 71 FCR 285 ( NW Frozen Foods ) and J McPhee &amp; Son (Aust) Pty Ltd v Australian Competition and Consumer Commission [2000] FCA 365 ; (2000) 172 ALR 532 (J McPhee &amp; Son ), Full Courts of this Court approved of French J's list and added: (j) similar conduct in the past; (k) effect on the functioning of the market and other economic effects of the conduct; and (l) whether the conduct was systematic, deliberate or covert. The principal object of imposing a penalty under s 76 is deterrence, both specific and general: Trade Practices Commission v Stihl Chainsaws (Aust) Pty Ltd (1978) ATPR 40-091 at 17,896; TPC v CSR at 52,152; NW Frozen Foods , above, at 292-294. The principles governing the imposition of penalties for contraventions of Part IV must now be considered in the light of the most recent Full Court pronouncement on the matter in Minister for Industry, Tourism &amp; Resources v Mobil Oil Australia Pty Ltd [2004] FCAFC 72 ; (2004) ATPR 41-993 ( Mobil Oil ). Mobil Oil was not a Part IV case. The Minister for Industry, Tourism &amp; Resources sought, among other relief, an order that the respondent (Mobil) pay to the Commonwealth a pecuniary penalty by reason of its contravention of s 10 of the Petroleum Retailing Marketing Sites Act 1980 (Cth). The primary judge was Gyles J. On his recommendation the Chief Justice directed, pursuant to s 20(1A) of the Federal Court of Australia Act 1976 (Cth), that the jurisdiction of the Court should be exercised by a Full Court in respect of the following question: Where the parties propose an agreed amount to be imposed as a penalty pursuant to s 13 of the Petroleum Retailing Marketing Sites Act 1980 (Cth), is the Court bound by the decision in [NW Frozen Foods] to consider whether the proposed amount is within the permissible range in all the circumstances and, if so, impose a penalty of that amount? The Full Court answered this question as follows: No, but the reasons in [ NW Frozen Foods ] discloses no error of principle. At [51] the Full Court noted that the following propositions emerged from NW Frozen Foods : (i) It is the responsibility of the Court to determine the appropriate penalty; (ii) Determining the quantum of a penalty is not an exact science and the courts have acknowledged that within a permissible range, a particular figure cannot necessarily be said to be more appropriate than another; (iii) There is a public interest in promoting settlement of litigation, particularly where it is likely to be lengthy; (iv) The view of the regulator, as a specialist body, is relevant, but not determinative, and its views on matters within its expertise will usually be given greater weight than its views on more "subjective" matters; (v) The Court examines all the circumstances of the case, and where the parties have advanced an agreed statement of facts, the Court may act on it if it is appropriate to do so; and (vi) Where the parties have jointly proposed a penalty, it is not useful to investigate whether the Court would have arrived at that precise figure; the figure will be appropriate if within the permissible range. The Full Court in Mobil Oil made the following further five points: &#8226; First, the rationale for giving weight to a joint submission on penalty is the saving in resources for the regulator and the Court, which, in the case of the regulator, can be used to increase the likelihood that other contraveners will be detected and brought before the Court. &#8226; Second, the sixth proposition from NW Frozen Foods (see [26] above) does not mean that the Court must commence its reasoning with the level of penalty proposed and limit itself to considering whether that penalty is within the permissible range: the Court may, instead, address the question independently at the outset. &#8226; Third, there was no suggestion in NW Frozen Foods that the admissions or statement of agreed facts had been "tailored or modified to reflect the difficulties faced by the [Commission] in proving its case" (at [55]). &#8226; Fourth, the regulator should always explain to the Court the process of reasoning said to justify a discounted penalty (the Court referred to Australian Competition and Consumer Commission v Ithaca Ice Works Pty Ltd (2002) ATPR 41-851 at [56]). &#8226; Fifth, there is nothing in NW Frozen Foods inconsistent with any of the following propositions: (i) The Court may request the parties to provide additional evidence or information or to verify the information provided, in default of which the Court may well not be satisfied that the proposed penalty is within the permissible range; (ii) If the absence of a contradictor inhibits the Court in the performance of its duty under s 76 of the Act, it may seek the assistance of an amicus curiae or of an individual or body prepared to act or intervene under O 6 r 17 of the Federal Court Rules ; and (iii) If the Court is disposed not to impose the agreed penalty, it may be appropriate for the parties or either of them to be given the opportunity to withdraw consent and for the matter to proceed as a contested hearing.