Case: Trade Practices Commission v TNT Australia Pty Ltd (1995) ATPR 41-375
Outcome: considered
In McPhee , the Full Court (comprising Black CJ, Lee and Goldberg JJ) reviewed the authorities, including Stihl , Trade Practices Commission v Mobil Oil Australia Ltd (1984) 4 FCR 296 at 298 and Trade Practices Commission v TNT Australia Pty Ltd (1995) ATPR 41-375 ( 'TNT' ) at 40,166, in which the courts attached importance to the deliberateness of the contravening conduct. The Full Court concluded that in fixing penalties under s 76 it is appropriate and relevant to take into account whether the conduct that contravened the TPA was systematic, deliberate or covert: at 577 [158] and at 579 [163]. In doing so, the Court does not stray into irrelevant moral considerations. 19 Depending on the circumstances of the case, other principles may also be relevant. Where the relevant conduct gives rises to several contraventions of the TPA, it will be relevant to take into account the totality principle to ensure that the total penalty does not exceed what is proper for the entire contravening conduct in question: see Trade Practices Commission v Advance Bank Australia Ltd (1993) ATPR 41-229 ( 'Advance Bank' ) at 41,164 per Gummow J; Australian Competition and Consumer Commission v ABB Transmission and Distribution Ltd (No 2) (2002) 190 ALR 169 ( 'ABB Transmission' ) at 179-180 [38]-[39]; TNT at 40,169. The parity principle, ie all other things being equal, similar conduct should be deserving of similar penalties, will have direct application where penalties are being imposed on several contravening respondents. The principle also draws attention, albeit less directly, to the penalties that have been imposed in past cases. There is, of course, a limit to the usefulness of any comparison with past penalties: the circumstances of particular cases are likely to differ in significant respects and each case must be considered by reference to its own circumstances: see Australian Competition and Consumer Commission v George Weston Foods Ltd (2000) ATPR 41-763 ( 'George Weston' ) at 40,984 [31] per Goldberg J. 23 The CEPU also advanced a number of alternative submissions. First, it submitted that its conduct should be viewed as a single course of conduct, attracting one penalty only, even if it were possible to draw some distinction between the conduct that was relevant to s 45E and that which was relevant to s 45EA. In support of this submission, the CEPU relied upon Advance Bank at 41,164 per Gummow J; ABB Transmission at 179-180 [38] and Australian Competition and Consumer Commission v Rural Press Ltd (2001) ATPR 41-833 ( 'Rural Press' ) at 43,290 [16]-[17]. Further or alternatively, the CEPU submitted that if this approach could not be adopted, its conduct in relation to the two contraventions was so interconnected that, by the application of the totality principle, the Court ought to arrive at a penalty of the same magnitude as if it were dealing with a single contravention: see Rural Press at 43,290 [19] and TNT at 40,169. 28 In Trade Practices Commission v Allied Mills Industries Pty Ltd (No 4) (1981) 37 ALR 256 ( 'Allied Mills' ) at 258, Sheppard J was required to assess penalties in relation to price fixing contraventions of s 45 of the TPA. His Honour said that where more than one breach of s 45 is alleged and admitted, it would not be appropriate to impose substantive penalties for each breach because each arises out of the one transaction, namely, the arrangement or understanding alleged in the amended statement of claim. In taking this course, Sheppard J followed the approach adopted by Kitto J in imposing penalties for breaches of the Customs Act 1901 (Cth) in L Vogel &amp; Son Pty Ltd v Anderson (Minister for Customs) [1967] HCA 46 ; (1968) 120 CLR 157 at 164-165. Sheppard J's approach was followed in TNT at 40,169. These cases involved applications of the totality principle rather than s 76(3). 32 The Full Court added at 584 [185] that, if s 76(3) did not apply, the totality principle should have been applied because of the interlocking nature of the conduct involved in the two contraventions: 'If it could be said that the conduct relevant to the two contraventions was not the same conduct for the purpose of s 76(3) , we would be of the opinion that his Honour's discretion in calculating the appropriate penalty to be imposed miscarried, in that his Honour failed to have regard to the interlocking nature of the conduct involved in the two contraventions and to the need to set a total penalty appropriate in the circumstances. On the particular facts of this case, it was not appropriate to impose a substantive penalty for each breach of the Act arising as they did out of the one transaction. The appropriate course was to set a penalty for the conduct imposed in respect of one breach and to take the other breach into account: Trade Practices Commission v Allied Mills Industries Pty Ltd (1981) 37 ALR 256; 60 FLR 1 per Sheppard J at FLR 40; Trade Practices Commission v TNT Australia Pty Ltd , above, at 40,169; McDonald v R (1994) 48 FCR 555; 120 ALR 629. For the reasons we have set out above, we consider that the appropriate total of penalty would have been a sum of $500,000.' The penalty of $500,000 was the same figure that the Full Court considered to be the appropriate penalty on the footing that s 76(3) did apply. 61 It is a well accepted principle that, in the assessment of a penalty, a respondent who withdraws defences and acknowledges liability, and thereby saves the community the costs of a lengthy trial, is entitled to special consideration in reduction of the penalty that would otherwise be assessed: NW Frozen Foods at 293-294 per Burchett and Kiefel JJ; TNT at 40,169 40,170 per Burchett J; and Minister for Industry, Tourism and Resources v Mobil Oil Australia Pty Ltd (2004) ATPR 41-993 at 48,626 48,630 [49]-[71] per Branson, Sackville and Gyles JJ. The extent of the discount will depend, inter alia, upon whether the respondent's co-operation with the ACCC indicates a resolve to comply with the law, thereby reducing the need for specific deterrence: see Leahy (No 3) at 309-310 [40]-[41] per Goldberg J. 64 The ACCC's submission is unacceptable as a matter of general principle and runs counter to settled authority in this Court. In TNT at 40,170, Burchett J said: 'It need hardly be emphasized that the acceptance by the Court of the principle recognizing the taking into account of an admission of liability, and the saving of time and expense involved in it, does not imply any doctrine that would increase a penalty because there was no admission. The law does not permit that. The contravener who fights the case to the bitter end will obtain no discount, but the penalty imposed will be the proper penalty, and no more. However, the penalties I have ordered to be paid here do not represent what I would have imposed as proper in such circumstances, since I have made substantial allowance for the admissions, both as indicative of a true resolve to comply with the law in future, and as involving a benefit to the community, belated though it was, that ought to be recognized in the fixing of penalties that are just in all the circumstances.' In Rural Press Ltd v Australian Competition and Consumer Commission [2002] FCAFC 213 ; (2002) 118 FCR 236, the ACCC contended on appeal that the trial judge had erred by concluding that the respondents should be given credit for their meaningful co-operation in the investigation of the ACCC and in the conduct of the hearing. On that occasion, the ACCC submitted that there was no support in the authorities, or in principle, for a penalty to be reduced on account of the way in which litigation is conducted where liability is in issue. The Full Court accepted the ACCC's submission and concluded that the conduct of the trial should not have been taken into account in fixing penalty, although it is something to which regard might have been had in relation to costs orders: at 285 [166].