FEDERAL COURT OF AUSTRALIA

Pattinson v Australian Building and Construction Commissioner [2020] FCAFC 177

ORDERS

THE COURT ORDERS THAT:

1.    The appeal be allowed and the Notice of Contention be dismissed.

2.    Orders 1 and 2 of the Court made on 14 October 2019 be set aside and in lieu thereof it be ordered that:

(a)    The first respondent pay to the Commonwealth pecuniary penalties under s 546 of the Fair Work Act 2009 for the two contraventions of s 349(1)(a) of the Fair Work Act 2009 on 13 September 2018 in the sums of $4,000 and $500.

(b)    The second respondent pay to the Commonwealth pecuniary penalties under s 546 of the Fair Work Act 2009 for the two contraventions of s 349(1)(a) of the Fair Work Act 2009 on 13 September 2018 in the sums of $38,000 and $2,000.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

ALLSOP CJ, WHITE AND WIGNEY JJ:

Introduction

1    This appeal raises a number of important questions as to the proper approach to the determination of the appropriate level of civil penalties in any particular case, in particular the proper approach where a contravenor can, from the relevant circumstances, including its record of prior contraventions, be inferred to have demonstrated an unwillingness to obey a statute, whether generally, or in relation to certain provisions.

2    The primary judge approached the imposition of civil penalties perceiving a difference in operative principle as expressed in a number of Full Court decisions. In particular, he perceived error in the expression of principle by Besanko and Bromwich JJ in Parker v Australian Building and Construction Commissioner [2019] FCAFC 56; 270 FCR 39 (with which expression of principle Reeves J agreed), and in the expression of principle by Bromwich J in dissent in an earlier Full Court appeal of Construction, Forestry, Maritime, Mining and Energy Union v Australian Building and Construction Commissioner (Broadway on Ann) [2018] FCAFC 126; 265 FCR 208. The primary judge saw the correct approach exhibited in the reasons of the majority in Broadway on Ann (Tracey and Logan JJ) in preference to the approach of Bromwich J in dissent in the outcome of the appeal, and in preference to the most recent considered Full Court decision in Parker.

3    The first and substantive ground of the appeal was that the primary judge erred by failing to approach the imposition of civil penalties on the second appellant (the union) by characterising the nature, seriousness or gravity of the instant contraventions by reference only to the objective characteristics of the contraventions and without regard to the union’s history of contravention of the statute. The error, it was submitted, was to be found in a misunderstanding by the primary judge of the relevant principle drawn from sentencing in the criminal law, and by reason of that misunderstanding a penalty was imposed that was disproportionate to the nature and gravity of the contravention in question.

4    In a notice of contention, on the hypothesis that the second appellant’s approach to assessing the appropriate penalty was correct, by reference to existing principle, the Commissioner sought to have recast the relevant operative principle to remove entirely, or to subordinate, any such principle of proportionality.

5    Both the notice of appeal and notice of contention require the addressing of matters of general principle in their historical development, the examination of the statutory provisions in question, and the examination, largely chronologically, of decisions of the Court relevant to the resolution of the arguments.

6    Importantly in the above, and not just as part of dealing with the notice of contention, it will be necessary to consider the place of the statutorily mandated maximum penalty in the light of the object of civil penalties, and in the context of what might be called the “recidivist” contravenor.

The primary judgment and the debate about proportionality in the Court

7    Arising from what has been seen as a difference in approach in Broadway on Ann compared to cases such as Parker, generated by the judgment below, a difference of opinion amongst judges of the Court has been expressed as to the place of the principle of proportionality in the imposition of civil penalties. Involved in this difference of opinion are different understandings and applications of what such a principle involves. It is therefore necessary to be cautious as to the use of the expression lest it become a label and distract analysis, and the proper explication, of principle.

8    The question said to be raised by the appeal is whether a contravenor’s history of contraventions can be taken into account in assessing the gravity of the contravention. That is important because it was submitted by the second appellant that it is from the assessment of the gravity of the contravention (objectively assessed) that the range of possible proportionate penalties is obtained, within which range the contravenor is placed according to considerations relevant to him, her, or it, such as prior offending and an apparent unwillingness to comply with the law.

9    A brief discussion of the judgment below suffices for present purposes to reveal the issue on appeal. The events in question occurred in September 2018 at a building site in Frankston, Victoria, which was occupied by a contractor (Multiplex) in charge of a project to build accommodation for Monash University.

10    Mr Pattinson was an employee of Multiplex who worked on the site. He was also an officer of the second respondent, the union (the CFMMEU), and was the union delegate on the site.

11    In September 2018, a subcontractor was engaged to install solar panels at the site. Two employees of the subcontractor attended the site to carry out the necessary work. On that day (13 September) Mr Pattinson spoke to the subcontractor’s employees in substance as recounted by the primary judge at [15]–[16] of his reasons:

15 … They arrived early that morning, whereupon they attended an induction session overseen by Mr Pattinson (in his capacity as a delegate of the Union’s at the Site). During the course of that session, Mr Pattinson enquired of one of the SEA employees, “Are you union? Do you have a ticket for your fees? Have you paid your fees?” or words to that effect. The SEA employee replied, “No, we’re not a union-based company so we don’t have our ticket,” or words to that effect. It is not in dispute that neither of the SEA employees was, in fact, a member of the Union.

16 Mr Pattinson then spoke to the SEA employees about their obligation to join an industrial association. The Commissioner’s amended statement of claim dated 5 June 2019 contains detailed particulars of that conversation. The respondents’ amended defence admits the effect of what was said but, as is to be expected, is silent as to whether or not the particulars are accurate. It is accepted that the effect of the discussion was that Mr Pattinson represented to each of the SEA employees that, in order to perform the work that they were at the Site to perform, they had to become a member of an industrial association …

12    The two subcontractor employees did not work on the site on that day, inferentially and uncontroversially, because of what Mr Pattinson had said. Before the primary judge, the statements were accepted by the appellants to be misrepresentations knowingly or recklessly made that were false or misleading and contrary to s 349(1)(a) of the Fair Work Act 2009 (Cth), the terms of that section being as follows:

(1)    A person must not knowingly or recklessly make a false or misleading representation about either of the following:

(a)    another person’s obligation to engage in industrial activity;

13    It was accepted that by this body of events there were two contraventions (one for each of the employees) by both Mr Pattinson and by the union, as to the latter by the operation of s 363(1)(b) and s 363(3) of the Fair Work Act.

14    The admission as to liability by the appellants is to be understood by reference to the combined operation of s 349(1)(a) and s 347(a) which provide relevantly that a person engages in industrial activity if he or she becomes or does not become a member of an industrial association. Thus, to tell the two employees that they were obliged to join the union if they were to work on the site was false or misleading for the purposes of s 349(1)(a). The contravening conduct can be seen as in furtherance of the union’s preference for work sites to be “no ticket, no start” sites: that is all workers on site being union members.

15    The question before the primary judge was the appropriate penalties to be imposed upon Mr Pattinson and the union. The maximum penalties for each contravention were 60 penalty units ($12,600) for Mr Pattinson and 300 penalty units ($63,000) for the union.

16    The primary judge described the contentions of the parties in [25] of his reasons as follows:

… The Commissioner contends that the [contraventions] should attract penalties at or approaching the maximum in respect of the Union (that is, a total of, or near, $126,000.00), and of between $4,000.00 and $6,000.00 per contravention ($8,000.00-$12,000 in total) for Mr Pattinson. The respondents contend that they should attract penalties “…proportionate to contraventions that are objectively below the mid-range of seriousness.”

17    In submissions before this Court senior counsel for the appellants more fully described the submissions made below as follows:

The appellants submitted that the objective seriousness of the contravening conduct fell below the middle of the spectrum of seriousness. The contravening conduct involved a single representation; was not systematic or part of a wider campaign; was deliberate but not pre-planned; and did not result in any economic or other material loss to anyone. The appellants accepted that the CFMMEU’s history of contravening conduct heightened the need for deterrence, but submitted that it did not bear on the assessment of the objective gravity of the instant contraventions, nor did it operate to transform the character of those contraventions. The utilitarian value of the appellants’ cooperation with the respondent in resolving the matter at an early stage was pointed to as a matter in mitigation.

18    The last sentence of this submission (the utilitarian discount) is the subject of the second ground of appeal.

19    The primary judge accepted that there was no evidence of any economic loss or any material loss arising from the contraventions. His Honour also concluded that the contravening conduct was not at the upper end of a scale of seriousness if assessed independently of the union’s history. The parties were in agreement on this last point. The primary judge concluded that the union’s history was relevant in assessing the gravity or seriousness or nature or character of the contravention. Having regard to the union’s recidivism, the instant contraventions were, in his Honour’s view, contraventions of the gravest kind. At [71]–[72] and [83]–[86] of his reasons the primary judge stated the following:

71 Civil penalties have only one objective: deterrence. The court is charged, simply enough, with fashioning a penalty that serves to deter, both generally and specifically, the conduct in respect of which it is levelled.

72 If the only way to deter even the most objectively inoffensive conduct (so assessed without reference to historical context) is to impose a penalty at or approaching the maximum amount available, then the imposition of anything less would necessarily result in a failure to achieve the only object to which the imposition of civil penalties is directed. That acknowledged, it is not apparent to me how a civil penalty that is fashioned at (and not beyond) a level that is necessary in order to deter the repetition of particular conduct might ever be impugned as disproportionate to its nature or gravity (or seriousness or character). To phrase that proposition as a question: how can a penalty be disproportionate to the nature or gravity of the conduct in respect of which it is imposed if it is no more than what is necessary to achieve the only objective that its imposition is meant to achieve?

…

83 It follows, in my view, that in assessing the nature, character and seriousness (and/or gravity) of the Union’s Agreed Contraventions, regard may properly be had to its history of contravening conduct. That history is, on any view, not flattering. Many judges of this court have commented upon it: often in unambiguously scathing terms; always, it seems, to little if any avail. I do not relish the prospect of adding my name to the long list of judicial officers whose exasperated admonitions appear to have been met with studied indifference; and, perhaps on one occasion, with public dismissal as the invalid mutterings of snobbish hypocrites who “call us criminals [and] all sorts of things [and] fine us millions of dollars [despite having] probably never done a day’s work in their li[ves]”: Victoria International Container Terminal Ltd (t/as VICT) v Maritime Union of Australia [2017] VSC 762, [21] (McDonald J).

84 Regardless, I should make clear that I regard the Union’s Agreed Contraventions—viewing them, as I do, against the backdrop of its sorry record of statutory contravention—as very much of the gravest, most serious kind. It is bad enough that it should so casually intrude upon rights of free association so valued by societies of conscience; much worse that it should do so, yet again, in deliberate defiance of the law that it has been told time and time again that it must obey. Its behaviour in this case—and many others before it—admits only of the following conclusions, namely that:

(1)    it favours a policy of “no ticket, no start” and holds that philosophy (if not the achievement of its industrial objectives more broadly) as preferable to the law of the land—see Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (Werribee Shopping Centre Case) [2017] FCA 1235, [23], [28] (Tracey J);

(2)    it appears to be wholly unmoved by the prospect that it might be forced yet again to dig into its members’ “big pots of gold” in the name of “fight[ing] the good fight”—to use the terminology that features in Victoria International Container Terminal Ltd (t/as VICT) v Maritime Union of Australia & Anor [2017] VSC 762, [23] (McDonald J); and

(3)    it regards doing so as an acceptable cost of the way that it conducts its affairs—the misconduct in this case is but the latest example of the Union’s strategy “…to engage in whatever action, and make whatever threats, it wishes, without regard to the law, and then, once a prosecution is brought, to seek to negotiate its way into a position in which the penalties for its actions can be tolerated as the price of doing its industrial business”: Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union (No 2) [2016] FCA 436, [142] (Mortimer J).

85 The position of Mr Pattinson is not as repellent. As is recorded above, Mr Pattinson has not previously been found to have contravened the FW Act or its predecessors. Unlike some of his colleagues, he is not—and, one hopes, will not soon become—a recidivist who thumbs his nose at the requirements of the law. Nonetheless, given his long-held position and rank within the Union, it is patently absurd to conclude anything other than that he did what he did out of fealty to his Union’s policy of enforcing a “no ticket, no start” regime at the construction sites over which it wields influence. That he embarked down the path that he did reflects poorly upon him.

86 Those conclusions stated, Mr Pattinson’s Agreed Contraventions were much more serious than what might otherwise call for a proverbial slap on the wrist. Mr Pattinson is merely the latest foot soldier in what seems to be the Union’s war against free association on Australian building sites. There have been others like him—the Commissioner referred to them, fairly and pithily, as “institutionalised human agents”—who, in the past, have stood ready to do as he did (and worse). One might be forgiven for doubting that there might not be others who stand ready to do similar things in the future. It is important that the penalty that is imposed upon Mr Pattinson is fashioned at a level that is sufficient to deter repetition of the conduct not only by Mr Pattinson but also by the network of other delegates and officers of the Union who might themselves be minded to enforce its anachronistic “no ticket, no start” philosophy. …

20    The appellant agreed with the conclusion of the primary judge that he was faced with conflicting authority, but submitted that he should not have departed from cases such as Parker, that Broadway on Ann was incorrect as a matter of principle, and that the history of contraventions could not be taken into account in assessing the nature and gravity of the contravention in question. There were no grounds of appeal upon the reasoning or findings that his Honour made, which were extensive, as to what could be drawn from the prior contravening of the union. For instance, there was no appeal from findings of the kind made in [84(1)], [84(2)] and [84(3)] above about the union’s attitude to the law. The appeal was concerned with the approach in assessing the gravity of the contravening and the misuse of the principle of proportionality and also whether the penalty imposed on the union was excessive. Ground 1 of the notice of appeal was as follows:

1.    The primary judge erred in so far as his Honour:

1.1    held (J[82], [83]) that the Court could take into account the second appellant’s history of contravening conduct in determining the nature, character, seriousness and / or gravity of the instant contraventions;

1.2     failed to first identify the applicable range of penalties for the instant contravention, without regard to the second appellant’s history of contraventions, before next taking into account that history for the purpose of assessing where, within that applicable range, the penalty should fall;

1.3     held that the second appellant’s history of contravening conduct may convert contraventions that the parties had agreed (J[68]) and the Court had found were not at the upper end of the scale of seriousness, to contraventions the nature, character and seriousness of which was “very much the gravest, most serious kind” (J[84]);

1.4     failed to follow and apply Full Court authority that was binding on him, namely the decision in Parker v ABCC (2019) 365 ALR 402;

1.5     held that it was open to him (J[69]) to decide for himself which of the competing analyses of the Full Court to prefer, and in so doing, concluded that the reasoning of the majority in The Broadway on Ann Case [2018] FCAFC 126 was to be preferred to the decision in Parker v ABCC (2019) 365 ALR 402;

1.6     held that a penalty at or close to the maximum was appropriate with respect to the second appellant;

1.7     imposed a penalty on the second appellant which was manifestly excessive in all the circumstances.

21    We will defer an examination of the primary judge’s treatment of Broadway on Ann and Parker until after we have discussed those cases.

Preliminary comment

22    Notwithstanding that these reasons will, of necessity, examine closely the reasons of a number of judgments, it should be borne in mind at all times that reasons of judges are not words of a statute, and the warning of Lord Reid in Cassell & Co Ltd v Broome [1972] AC 1027 at 1085 of the danger of placing reliance on the literal words of particular judgments instead of searching for the applicable principle should be heeded: see Cain v Glass (No 2) (1985) 3 NSWLR 230 at 248; Scott v Davis [2000] HCA 52; 204 CLR 333 at 370 [108]; Ryan v The Queen [2001] HCA 21; 206 CLR 267 at 272 [15]; Papaconstuntinos v Holmes à Court [2012] HCA 53; 249 CLR 534 at 548 [29]; and Minister for Immigration and Border Protection v SZVFW [2017] FCAFC 33; 248 FCR 1 at 17 [57].

The importance of the statute

23    It is necessary to bear in mind at all times two propositions that cannot be, and were not, in contest. First, the now familiar regulatory remedy of the civil penalty is a creature of statute. The Court has no power to impose a penalty as a remedy for a breach of a legislative provision without statutory authority. Secondly, the scope of the Court’s power and the subject of the penalty are matters of statutory construction.

24    These propositions, especially the second, are not merely concerned with meaning and text. They involve the recognition that Parliament invests the courts with authority to impose penal sanctions on persons in aid of a statutory object based on principles of application whether contained within the statute or in the law against the background of which the statute can be seen to be enacted.

The clarification by the High Court of the object of civil penalties

25    To these two propositions can be added a third, derived from the reasons for judgment of French CJ, Kiefel, Bell, Nettle and Gordon JJ in Commonwealth of Australia v Director, Fair Work Building Industry Inspectorate [2015] HCA 46; 258 CLR 482 (Agreed Penalties Case (HC)). There, in distinguishing the proper approach to the determination of civil penalties from sentencing under the criminal law, and in particular the lack of relevance of Barbaro v The Queen [2014] HCA 2; 253 CLR 58 to the process of the imposition of civil penalties, their Honours adopted what had been said by the Chief Justice when a judge of this Court in Trade Practices Commission v CSR Ltd [1990] FCA 762; [1991] ATPR ¶41-076 at 52,152, to the effect that the principal, if not only, object of penalties was “to deter repetition by the contravenor and by others who might be tempted to contravene the Act”. In CSR, French J was referring to the Trade Practices Act 1974 (Cth) and the provisions there (in Pt IV) dealing with economic regulation. The Court in the Agreed Penalties Case (HC) was applying the proposition to penalties under a statute concerned with industrial relations, the Building and Construction Industry Improvement Act 2005 (Cth) (BCII Act). As the plurality in the Agreed Penalties Case (HC) said at 258 CLR 506 [55] “the purpose of a civil penalty … is primarily if not wholly protective in promoting the public interest in compliance [with the statute]”.

26    This third proposition derived from the Agreed Penalties Case (HC) settled what had been perceived to be a difference of view in this Court as to the object of the imposition of civil penalties. That difference of view was discussed by Finkelstein J in Australian Competition and Consumer Commission v ABB Transmission and Distribution Limited [2001] FCA 383; ATPR ¶41-815 at [4]–[13], in particular at [7] where his Honour said:

The third matter concerns the purpose of imposing penalties. There is as yet no concluded view on the object of the imposition of penalties for a contravention of Pt IV. It is only when this issue is finally resolved that there can be a degree of certainty in deciding the appropriate level of penalty in a particular case. At the moment there are two competing views, although the application of the principles of each school of thought may overlap. Some favour the view that deterrence, either specific or general, is the sole criterion. Others say that retribution is an important element.

27    The view that deterrence was the sole object of the imposition of the penalty was attributed by Finkelstein J to French J in CSR in the passage approved in unqualified terms by the plurality in the Agreed Penalties Case (HC) 258 CLR at 506 [55] where the plurality stated:

No less importantly, whereas criminal penalties import notions of retribution and rehabilitation, the purpose of a civil penalty, as French J explained in Trade Practices Commission v CSR Ltd, is primarily if not wholly protective in promoting the public interest in compliance:

Punishment for breaches of the criminal law traditionally involves three elements: deterrence, both general and individual, retribution and rehabilitation. Neither retribution nor rehabilitation, within the sense of the Old and New Testament moralities that imbue much of our criminal law, have any part to play in economic regulation of the kind contemplated by Pt IV [of the Trade Practices Act] … The principal, and I think probably the only, object of the penalties imposed by s 76 is to attempt to put a price on contravention that is sufficiently high to deter repetition by the contravenor and by others who might be tempted to contravene the Act.

(Footnotes omitted.)

28    The view that retribution was relevant as one of the objects of the imposition of a civil penalty could be seen in a number of cases. For example, in Australian Competition and Consumer Commission v J McPhee & Son (Australia) Pty Ltd (No 5) [1998] FCA 310; ATPR ¶41-628, Heerey J said that while deterrence was a primary object of the imposition of civil penalties, concepts of moral responsibility long known to the criminal law were involved. His Honour said at 40,891:

While there has been a clear policy decision by Parliament that contraventions of the laws against anti-competitive conduct contained in Pt IV are not criminal offences, nevertheless s 76 imports into the penalty fixing process concepts of moral responsibility long known to the criminal law. In other words, the sources of the substantive provisions of Pt IV are doubtless economic policy and theory, but the penalties for contraventions are to be applied in a moral universe. Sheppard J said in Trade Practices Commission v Axive Pty Ltd (1994) ATPR ¶41-368 at 42,974 that:

… ordinary sentencing principles … apply notwithstanding that this is not a criminal prosecution.

…

By moral considerations I do not mean some kind of saccharine piety. The marketplace is, and is meant to be, a tough place. But the norms imposed by Pt IV, and in particular the prohibition of price-fixing, by now are to be seen as part of fair, honest and ethical business behaviour. Price-fixing, and in particular the kind of collusive bidding which was attempted in the present case, is a form of cheating. There is no reason why this aspect of the contravening conduct does not form part of the nature and extent of the act within the meaning of s 76(1). Also relevant is the conduct of those involved insofar as it involves factors like deliberation, knowledge of wrongdoing and concealment. Most if not all of these factors would fall within a consideration of the nature and extent of the act or the circumstances in which the act took place.

29    Further, in Ponzio v B & P Caelli Constructions Pty Ltd [2007] FCAFC 65; 158 FCR 543, Lander J (with whom Jessup J agreed) said the following at 559–560 [93]:

There are three purposes at least for imposing a penalty: punishment; deterrence; and rehabilitation. The punishment must be proportionate to the offence and in accordance with the prevailing standards of punishment: R v Hunter (1984) 36 SASR 101 at 103. Therefore the circumstances of the offence or contravention are especially important. The penalty must recognise the need for deterrence, both personal and general. In regard to personal deterrence, an assessment must be made of the risk of re-offending. In regard to general deterrence, it is assumed that an appropriate penalty will act as a deterrent to others who might be likely to offend: Yardley v Betts (1979) 22 SASR 108. The penalty therefore should be of a kind that it would be likely to act as a deterrent in preventing similar contraventions by like minded persons or organisations. If the penalty does not demonstrate an appropriate assessment of the seriousness of the offending, the penalty will not operate to deter others from contravening the section. However, the penalty should not be such as to crush the person upon whom the penalty is imposed or used to make that person a scapegoat. In some cases, general deterrence will be the paramount factor in fixing the penalty: R v Thompson (1975) 11 SASR 217. In some cases, although hardly in this type of contravention, rehabilitation is an important factor.

30    The Full Court in Director, Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union [2015] FCAFC 59; 229 FCR 331 (Agreed Penalties Case (FC)) sought at 357–359 to reconcile the views of French J in CSR and Lander J in Ponzio. Importantly, the Full Court qualified what French J had said, restricting it to penalties under the Trade Practices Act, saying the following at 229 FCR 357 [65]–[66]:

65 In CSR, French J was concerned with penalties to be imposed pursuant to Pt IV of the Trade Practices Act 1974 (Cth). We do not understand his Honour to have said that all pecuniary penalties are imposed purely for the purpose of deterrence. He was speaking solely of penalties imposed pursuant to that legislation and, we suspect, making two points:

•    that corporations which breach the provisions of Part IV are likely to be overwhelmingly motivated by commercial considerations; and

•    that in order to make potentially profitable, but unlawful conduct unappealing as a business choice, a substantial penalty or threat of such penalty is necessary.

66 We doubt whether French J intended to propound the broad proposition which the Commonwealth advances. Even if his Honour meant that as a matter of statutory construction, the purpose of Pt IV penalties was purely deterrence, there can be no justification for extending that view to all other statutory regimes which provide for such penalties. The relevant legislation will provide the most reliable basis for identifying Parliament’s purpose.

31    The submissions put by the Commonwealth to which the Full Court was referring was recorded by the Court at [64], as follows:

The Commonwealth submits that there is a fundamental distinction between criminal punishment and the imposition of a pecuniary penalty. It is said that they serve different purposes. The Commonwealth submits that the distinction reflects a “principle” said to have been established by the decision of French J (as his Honour then was) in Trade Practices Commission v CSR Ltd [1991] ATPR ¶41-076. It submits that the case establishes that the purpose to be served by the imposition of a pecuniary penalty is general and specific deterrence. …

32    The Agreed Penalties Case (FC) (and the High Court on appeal) was concerned with the BCII Act (for present purposes, a statute that can be seen as cognate with the Fair Work Act as involving industrial relations). The Full Court in the Agreed Penalties Case (FC) saw in the relevant statute considerations that made retribution and rehabilitation relevant. Before citing Ponzio 158 FCR at 559–560 [92]–[94] with approval, the Full Court said the following at 229 FCR 357–358 [67]:

At least some of the goals referred to in s 3 of the BCII Act – promoting respect for the rule of law, ensuring respect for the rights of building industry participants and ensuring accountability for unlawful conduct – go beyond mere deterrence. The promotion of respect for the rule of law and the rights of others suggests an element of education and rehabilitation. The term “ensuring accountability” implies recognition of any failure to behave in accordance with the law. Neither the Trade Practices Act (nor its successor) nor the BCII Act operates in isolation from the broader legal system. Respect for the rule of law necessitates a clear expression of the community’s displeasure concerning unlawful conduct. Save in the most trivial of cases, any breach of the law must be seen as an affront to the dignity of the community in which the law operates, and by which it is established. Repeated failure to deal with such breaches may undermine the whole legal system. In marking community displeasure, the imposition of an appropriate penalty is an act of retribution. Similar comments apply to the notions of respect for the rights of building industry participants and accountability for unlawful conduct. Although the goals have been tailored to reflect the subject matter dealt with by the BCII Act, they are based on concepts which are fundamental to respect for, and enforcement of law in any civilized community.

33    The Commonwealth had submitted that Ponzio 158 FCR at 559–560 [92]–[94] was wrong. That submission was rejected by the Full Court, the Court saying at 229 FCR 359 [71]:

… However, a pre-eminent purpose [deterrence] need not be the sole purpose. We consider that in any system of penalties the various identified purposes of punishment [retribution, rehabilitation and deterrence] will have greater or less relative significance, depending upon the type of misconduct in question, its prevalence at a particular point in time, difficulty of detection, potential for causing damage and many other considerations.

34    It is to be noted that in Ponzio at [93], Lander J referred to punishment (as well as deterrence and rehabilitation) as a purpose for imposing a penalty (thereby equating punishment with retribution), whereas the Full Court in the Agreed Penalties Case (FC) at [71] referred to the purposes of punishment in any system of penalties as including retribution (as well as deterrence and rehabilitation).

35    The High Court rejected the Full Court’s views, and stated, with clarity, that retribution and rehabilitation have no part to play as objects of the imposition of civil penalties: the object of civil penalties being entirely protective in promoting compliance, through deterrence (specific and general).

36    The questions of moral responsibility (“long known to the criminal law” as Heerey J said in McPhee) are bound up with notions of retribution and denunciation by the characterisation of the morality of the wrong as relevant to the appropriate nature of the response in punishment for the contravention (and in this sense, offending). The inaptness of the intrusion of moral judgments beyond the content of the relevant statute in the context of the imposition of civil penalties was commented upon by French J in CSR at 52,151 when his Honour said the following in relation to s 46 of the Trade Practices Act:

But characterisation of contravening conduct in terms of a morality larger than that which is defined by the legislative purpose is misplaced.

37    It is unnecessary to dwell further on these matters beyond saying that it is of some importance in the dispassionate and independent discharge of the court’s function in the resolution of disputes and the administration of justice that the exercise of judicial power does not appear to be clouded or compromised by the use of language foreign to the task of deterrence, involving expressions of moral denunciation that are not drawn from the statute and that the High Court has said are foreign to the judicial task of assessing and imposing an appropriate penalty.

The place of punishment

38    The terms of the High Court’s reasons have led to some discussion as to whether civil penalties are to be characterised as punishment: see the cases to which the Court referred in the Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union [2017] FCAFC 113; 254 FCR 68 (Queensland Infrastructure Case) at [99] set out below at [110]. The discussion has both a substantive and a semantic perspective. As a matter of substance, if by the word “punishment” is meant retribution, the plurality was clear. It is a consideration foreign to the relevant purpose or object of the imposition: protection of the public interest by promoting compliance with the statute by deterrence. As a matter of semantics, the remedy is penal: a penalty, albeit civil in character. The ordinary meaning of the word “penalty” includes “a punishment imposed for breach of law, rule, or contract” and of “penal” includes “punitive; prescribing or enacting the punishment of an offence or transgression”: The Shorter Oxford English Dictionary on Historical Principles (3rd ed, Oxford Clarendon Press, 1986) at 1542–1543.

39    If one recognises that the imposition of the civil penalty or the imposition of punishment in the nature of a civil penalty has only one object or purpose: the protection of society in promoting the public interest by compliance with the relevant law by putting a price on contravention sufficiently high to deter repetition by the contravenor or by others who might be tempted to contravene, then perhaps little utility and no error can be seen in viewing a civil penalty as a form of punishment. Given, however, the clarity of the view of the majority in the Agreed Penalties Case (HC) as to the object of imposition of a civil penalty, to avoid confusion and the risk of error, it is better not to describe the function of the imposition of a civil penalty as punishment, lest notions of retribution intrude. Also, the nature of the provision, contravention of which may result in the imposition of a civil penalty, is relevant to consider. As French J said in CSR at 52,151 the provisions of Pt IV of the Trade Practices Act are “of a regulatory rather than penal character”. Whilst the remedy is a penalty, and so correctly to be called penal, the purpose or object of its imposition is protective to bring about regulatory compliance by deterrence. The same may be said about the substantive provisions of industrial relations legislation, such as the Fair Work Act, as Parliament’s expression of the appropriate rules of engagement of the community in the labour market, to be regulated in accordance with the statute.

Principles of sentencing in crime

40    Sentencing principles attending the imposition of punishment for breach of the criminal law have, for many years, played an important part in the development and application of principle concerned with the imposition of civil penalties, in particular the principle of proportionality as discussed most notably in Veen v The Queen [1979] HCA 7; 143 CLR 458 (Veen (No 1)) and Veen v The Queen (No 2) [1988] HCA 14; 164 CLR 465 (Veen (No 2)) and the method of reaching the relevant amount of the penalty by a process of evaluation in the nature of an “instinctive synthesis”: Markarian v The Queen [2005] HCA 25; 228 CLR 357. The extent to which principles of sentencing in criminal law are applicable, or properly adapted, to the imposition of civil penalties depends upon both the content of the statutory provisions providing for the civil penalty and upon the consequences of the different objects and purposes served by punishment for crime and imposition of civil penalties.

The principle of proportionality, retribution, and the humanising of criminal sentencing

41    An understanding of Veen (No 2) and related cases is critical to understanding the principle of proportionality in criminal sentencing and is important to the resolution of this appeal. Before coming to Veen (No 2), it is instructive to say something of “retribution” and its place in criminal sentencing. Justice French in CSR referred to “the Old and New Testament moralities that imbue much of our criminal law”. What is “retribution”? It is defined by the Macquarie Dictionary (rev ed, Macmillan Publishers, 1985 (1981)) as “1. requital according to merits or deserts, esp for evil. 2. Something given or inflicted in such requital. 3. Theological the distribution of rewards and punishments in a future life.” The Shorter Oxford English Dictionary defines “retribution” as:

1. Repayment, recompense, return, for some service, merit etc. Now rare. 2. Day of r., the day on which divine reward or punishment will be assigned to men …; also generally any day of punishment …; Recompense, in another life, for one’s good or bad deeds in this world. 3. A recompense for, or requital of, evil done; return of evil

42    One can see in those meanings the elements of a notion of proportionality: “according to merits or deserts”. Indeed, in modern times, the notion of retribution became a feature of English law of punishment for crime to civilise or make more humane the perceived evils of a system of punishment based on what Radzinowicz and Turner referred to as “a crude utilitarianism aiming at the reduction of crime through terror”: Radzinowicz L and Turner JWC, “Punishment (1) Outline of Developments Since the 18th Century” in Radzinowicz L and Turner JWC (eds), The Modern Approach to Criminal Law: Collected Essays (MacMillan & Co, 1945) p 39. The terror to which they referred was real. In its form in the late eighteenth century and early nineteenth century the object of deterrence through terror was captured in a work of history (Mackenzie, History of the Nineteenth Century, 10th ed, pp 77–78) to which Radzinowicz and Turner referred at op cit p 39:

If a man injured Westminster Bridge, he was hanged. If he appeared disguised on a public road, he was hanged. If he cut down young trees; if he shot rabbits; if he stole property valued at five shillings; if he stole anything at all from a bleach field; if he wrote threatening letters to extort money; if he returned prematurely from transportation; for any of these offences he was immediately hanged.

43    Thus, the place of retribution in criminal sentencing is not to be seen necessarily as some harsh moralistic feature of the law embodying revenge, whether, as French J said in CSR, “within the sense of the Old and New Testament moralities that imbue much of our criminal law”, or otherwise. Rather, as Radzinowicz and Turner say at op cit p 40:

Speaking generally, the study of this first stage of our criminal policy establishes the conclusion that there was no acceptance of any principle that the severity of punishment should be equated to the gravity of the offence. This principle became prominent in the second stage, when the doctrine of retribution took a leading place in contemporary thought on penal questions, and therefore it was felt that the crimes had to be graded according to their gravity and the punishments correspondingly graded so as to fit the crime in each case. The major assumption on which this conception rests is that every individual in the State has certain fundamental rights as a human being, which should not be forfeited by the fact that he may have committed a crime.

44    One can see in such a discussion the foundation of a principle of proportionality in sentencing for crime. The retributive element in a sentence may, however, also reflect “the community’s expectation that the offender will suffer punishment and that particular offences will merit severe punishment”: Ryan 206 CLR at 283 [46] (per McHugh J). The proper recognition of this retributive element may also be seen to be related to maintaining public confidence in the administration of justice: R v Dole [1975] VR 754 at 769 and Ryan 206 CLR at 283 [46]. It is a form of justice based on equality: cf Green v The Queen; Quinn v The Queen [2011] HCA 49; 244 CLR 462.

45    As discussed below, that retribution can be seen as the (or a) source of the principle of proportionality does not necessarily lead to a conclusion that it is the only source of a principle based on reasonableness and proportion of response in the infliction of penal consequences for a statutory wrong.

The principle of proportionality in the criminal law and Veen (No 1) and Veen (No 2)

46    The principle of proportionality, its meaning and its difficult practical application can be seen in Veen (No 1) and Veen (No 2). The facts and circumstances of these cases are a tragic and brutal world away from the imposition of civil penalties to deter non-compliance with regulatory provisions in industrial relations or economic life. That difference in context does not, however, make applicable principle derived from Veen (No 2) any less binding; but it does assist in appreciating the caution required in transplanting words in reasons for judgment from one context to another.

47    In February 1975, Mr Veen, then twenty years of age, killed a man by repeated stabbing. He was convicted of manslaughter on the ground of diminished responsibility. The circumstances of the human tragedy of the crime, and of Mr Veen’s life, need not be recited in full detail, beyond saying that he had experienced a deprived life as an Aboriginal man who from childhood had suffered physical and sexual abuse, and from alcohol addiction. His abnormality of mind and reduced emotional control brought about by alcohol abuse were heightened when he was provoked or took alcohol. The fatal incident arose after the victim made a racial insult after having sexual relations with Mr Veen, who was working as a prostitute. The victim was ferociously and repeatedly stabbed. Mr Veen was sentenced to life imprisonment, the sentencing judge saying that he had “to be imprisoned for the protection of the community from his own uncontrollable urges”: see Veen (No 1) 143 CLR at 459. The High Court overturned the Court of Criminal Appeal’s refusal to interfere with Mr Veen’s sentence. The High Court (by majority) in Veen (No 1) allowed the appeal and substituted a sentence of 12 years imprisonment (his incarceration having commenced in 1975). Mr Veen was released on licence in January 1983, having been a model prisoner (“a good worker; very quiet, never a problem”: Veen (No 2) 164 CLR at 469). In October 1983 (but nine months after his release), Mr Veen repeatedly stabbed another man in similar circumstances. Once again, he was convicted of manslaughter by reason of diminished responsibility and once again he was sentenced to life imprisonment. Once again the Court of Criminal Appeal dismissed an appeal against sentence. This time, the High Court, by majority in Veen (No 2), dismissed the appeal.

48    At the centre of the debate in both Veen (No 1) and Veen (No 2) was the inter-relationship between the operation of the principle of proportionality and the protection of the community, and whether to sentence Mr Veen to life imprisonment could be seen as proportionate to his crime, or whether it could only be seen, in all the circumstances, as preventative detention without statutory warrant. Thus, it was not a question of specific or general deterrence, but protection of society by preventative detention that concerned the Court.

49    In Veen (No 2) Mason CJ, Brennan, Dawson and Toohey JJ at 164 CLR 473–474 referred, in the context of explaining proportionality, to the “illuminating controversy” in Res Judicatae, vol 6 (1953) between Mr CS Lewis, Dr Norval Morris, Dr Donald Buckle and Prof JJC Smart. As their Honours said at 473, the thesis advanced by CS Lewis “was that the retributive theory of punishment – punishing an offender because he deserves it – prevents the injustices which may be involved in detaining an offender in order … to protect society or to reform the offender”.

50    The majority said the following about the status of the principle at 472:

The sentencing principle which his Honour laid down [speaking of the sentencing judge in Veen (No 1)] is that a sentence should be “proportionate to the gravity of the offence” unless, perhaps, the applicant’s history warrants some departure from the principle. He then determined the appropriate proportionate sentence by reference to all the circumstances of the case. The principle of proportionality was not the point of divergence between the majority and minority [in the High Court in Veen (No 1)], however, for that principle was embraced expressly by Mason J (with the agreement of Aickin J). The majority decision in Veen [No. 1] reflected their Honours’ assessment of the particular circumstances of the case; ...

The principle of proportionality is now firmly established in this country. It was the unanimous view of the Court in Veen [No.1] that a sentence should not be increased beyond what is proportionate to the crime in order merely to extend the period of protection of society from the risk of recidivism on the part of the offender …

(Footnotes omitted.)

51    Veen (No 2) reveals the subtlety and importance of the inter-relationship between propensity, past offending and a proportionate sentence. After rejecting, at 472–473, the English approach of permitting a sentence greater than the principle of proportionality would allow in certain circumstances if the protection of the community warranted it, the majority said the following at 164 CLR 473:

It is one thing to say that the principle of proportionality precludes the imposition of a sentence extended beyond what is appropriate to the crime merely to protect society; it is another thing to say that the protection of society is not a material factor in fixing an appropriate sentence. The distinction in principle is clear between an extension merely by way of preventive detention, which is impermissible, and an exercise of the sentencing discretion having regard to the protection of society among other factors, which is permissible. …

52    It was at this point in their reasons that the majority referred to the “illuminating controversy” (see [49] above) and the place of the retributive theory of punishment as the source of the principle of proportionality. At 474, the majority referred to the “plea” of CS Lewis in the concluding reply set out at 164 CLR 473–474 expressed in CS Lewis’ rich language:

All I plead for is the prior condition of ill desert; loss of liberty justified on retributive grounds before we begin considering the other factors. After that, as you please. Till that, there is really no question of ‘punishment’. We are not such poltroons that we want to be protected unconditionally, though when a man has deserved punishment we shall very properly look to our protection in devising it.

53    The majority then continued at 474:

The plea has been heard by the courts of this country, by adopting the principle of proportionality and by having regard to the protection of society as a factor in determining a proportionate sentence. It must be acknowledged, however, that the practical observance of a distinction between extending a sentence merely to protect society and properly looking to society's protection in determining the sentence calls for a judgment of experience and discernment.

The basic difference between the majority and the minority in Veen [No. 1] lay in the differing assessments of what was the appropriate proportionate sentence. No judgment would have given support to a sentence exceeding what was truly proportionate. …

54    The derivation of the principle of proportionality from the retributive object of punishment is seen in Veen (No 2) 164 CLR at 473–474.

55    The majority in Veen (No 2) at 477–478 dealt with two further (and related) principles, described as subsidiary for the resolution of that appeal, which are of central importance to this appeal: the antecedent criminal history (here, antecedent contraventions) and the place of the maximum penalty.

56    As to antecedent criminal history of an offender, the principle of proportionality played the same important role. It is necessary to set out the whole passage on this first (subsidiary) principle at 164 CLR 477–478:

… [T]he antecedent criminal history of an offender is a factor which may be taken into account in determining the sentence to be imposed, but it cannot be given such weight as to lead to the imposition of a penalty which is disproportionate to the gravity of the instant offence. To do so would be to impose a fresh penalty for past offences: Director of Public Prosecutions v. Ottewell [[1970] AC 642 at 650]. The antecedent criminal history is relevant, however, to show whether the instant offence is an uncharacteristic aberration or whether the offender has manifested in his commission of the instant offence a continuing attitude of disobedience of the law. In the latter case, retribution, deterrence and protection of society may all indicate that a more severe penalty is warranted. It is legitimate to take account of the antecedent criminal history when it illuminates the moral culpability of the offender in the instant case, or shows his dangerous propensity or shows a need to impose condign punishment to deter the offender and other offenders from committing further offences of a like kind. Counsel for the applicant submitted that antecedent criminal history was relevant only to a prisoner’s claim for leniency. That is not and has never been the approach of the courts in this country and it would be at odds with the community’s understanding of what is relevant to the assessment of criminal penalties.

57    In Director of Public Prosecutions v Ottewell [1970] AC 642 at 650, Lord Donovan said “Or, it may be that repetition has itself increased the gravity of the offence.” These passages from Veen (No 2) are a clear statement that the consideration of prior offending or propensity is not limited to limiting or refusing any claim for leniency. Such prior offending may show moral culpability or propensity to offend or a continuing attitude of disobedience to the law, and so reveal the need for specific deterrence. Such an attitude of continuing disobedience may warrant, through retribution, deterrence and protection of society, a “more severe penalty”. But it is retribution, deterrence and protection from “offences of a like kind”. Such factors cannot be given such weight as to lead to a penalty “disproportionate to the gravity of the instant offence”. As seen below these passages have given rise to a difference of view as to whether prior offending can affect the assessment of the gravity of the offending, or whether it is a matter going to punishment of the offence, the gravity of which is assessed without regard to prior offending. The difference of view (in the context of sentencing in crime) reflects the central debate in this appeal.

58    What was said as to the first subsidiary principle was reinforced by the place of the maximum penalty. The majority said at 164 CLR 478:

The second subsidiary principle material to this case is that the maximum penalty prescribed for an offence is intended for cases falling within the worst category of cases for which that penalty is prescribed: Ibbs v. The Queen [(1987) 163 CLR 447 at 451–52]. That does not mean that a lesser penalty must be imposed if it be possible to envisage a worse case; ingenuity can always conjure up a case of greater heinousness. A sentence which imposes the maximum penalty offends this principle only if the case is recognizably outside the worst category.

59    The “worst type of case” was expressed in Ibbs v The Queen [1987] HCA 46; 163 CLR 447 at 451–452 by Mason CJ, Wilson, Brennan, Toohey and Gaudron JJ by reference to the reasons of Brennan, Deane and Gallop JJ in the Full Court of this Court on appeal from the Supreme Court of the Northern Territory in R v Tait [1979] FCA 32; 46 FLR 386. In expressing the principle by reference to two decisions of Dwyer CJ and Burt CJ in Reynolds v Wilkinson (1948) 51 WALR 17 and Bensegger v The Queen [1979] WAR 65, respectively, Brennan, Deane and Gallop JJ said at 46 FLR 398 (in a passage recently restated by the High Court in R v Kilic [2016] HCA 48; 259 CLR 256 at 265 [18]):

That principle requires that both the nature of the crime and the circumstances of the criminal be considered in determining whether the case is of the worst type.

(Emphasis added.)

60    As to the maximum penalty see also Elias v The Queen [2013] HCA 31; 248 CLR 483 at 494–495 [27].

61    Running throughout Veen (No 2) is the place of proportionality. Its source lies in the place of retribution for the gravity of the offending. The appropriate sentence, for the instant offence, is reached by a process which may have regard to prior offending in what it demonstrates about culpability, an attitude of disobedience to the law and the extent to which the community needs to be protected or the offender deterred. Such considerations are relevant to a sentence proportionate to the kind of case, judged by the nature of the offending and the circumstances of the offender.

62    The maximum penalty is not just a limit on power, it provides a statutory indication of the punishment for the worst type of case, by reference to which the assessment of the proportionate penalty for other offending can be made, according to the will of Parliament.

63    The passages in Veen (No 2) at 477–478 are at the centre of the disagreement in this case. They must be understood by reference to, and in the light of, contemporaneous and later High Court decisions. They have not been free from disagreement otherwise in the criminal sentencing context. It is appropriate to spend a little time examining that disagreement because it mirrors the points of disagreement in the arguments on appeal, albeit in the context of the imposition of the civil penalty.

64    Nine months after delivery of Veen (No 2), in Baumer v The Queen [1988] HCA 67; 166 CLR 51 (Baumer (HC)) the Court (Mason CJ, Wilson, Deane, Dawson and Gaudron JJ, all of whom had sat in Veen (No 2)) dealt with the subject of the relevance of prior convictions in the context of a dangerous driving offence in the Northern Territory. The sentencing judge (Asche J) had said, “What increases the seriousness of this particular offence is the literally appalling record of the accused as far as prior offences in relation to driving are concerned.” He had then observed that people with the propensity of the applicant to continue to commit driving offences must be “kept away” for the protection of society: see 166 CLR at 53. The Court in allowing the appeal and setting aside the order of the Court of Criminal Appeal that had dismissed the appeal said at 57–58:

In the present case, therefore, the task of the sentencing judge was to evaluate the circumstances of the offence in their entirety, including the influence of alcohol, and to determine an appropriate term of imprisonment having regard to the prescribed maximum of eleven years and to the possible range of offences to which it applied. His Honour purported to proceed in this way. However, the manner in which his Honour performed the task is open to question in two respects. We have already referred to his Honour’s observation that “the literally appalling record” of the applicant increased the seriousness of the offence. If this means no more than that such a record would make it difficult to view the circumstances of the offence or of the offender with any degree of leniency then, of course, such a remark would be understandable and unobjectionable. It would clearly be wrong if, because of the record, his Honour was intending to increase the sentence beyond what he considered to be an appropriate sentence of the instant offence. Similarly, his Honour’s observation that people with the propensity of the applicant to continue to commit driving offences must be “kept away” for the protection of the public is open to misunderstanding. Propensity may inhibit mitigation but in the absence of statutory authority it cannot do more. In applying a section like s. 154, the sole criterion relevant to a determination of the upper limit of an appropriate sentence is that the punishment fit the crime. Apart from mitigating factors, it is the circumstances of the offence alone that must be the determinant of an appropriate sentence.

(Emphasis added.)

65    Six months later, in Hoare v The Queen [1989] HCA 33; 167 CLR 348 at 354 in a South Australian appeal involving an offence of armed robbery, the Court (Mason CJ, Deane, Dawson, Toohey and McHugh JJ) said:

[A] basic principle of sentencing law is that a sentence of imprisonment imposed by a court should never exceed that which can be justified as appropriate or proportionate to the gravity of the crime considered in the light of its objective circumstances …

(Emphasis in original.)

66    This proposition just referred to in Hoare was footnoted by reference to Veen (No 2) at 472 (the plurality), 485–486 (Wilson J), 490–491 (Deane J) and 496 (Gaudron J): that is, the whole Court. To similar effect see Chester v The Queen [1988] HCA 62; 165 CLR 611 at 618 (citing Veen (No 1) 143 CLR at 467, 468, 482–483 and 495, Veen (No 2) 164 CLR at 472–474 and 485–486, and Walden v Hensler [1987] HCA 54; 163 CLR 561) where the need for sentences for criminal offences to be proportionate to the circumstances of the offence was described as a “fundamental principle”, as it was by McHugh J in Markarian 228 CLR at 385 [69] and in Ryan 206 CLR at 283 [48].

67    In Weininger v The Queen [2003] HCA 14; 212 CLR 629 at 640 [32] Gleeson CJ, McHugh, Gummow and Hayne JJ said:

A person who has been convicted of, or admits to, the commission of other offences will, all other things being equal, ordinarily receive a heavier sentence than a person who has previously led a blameless life. Imposing a sentence heavier than otherwise would have been passed is not to sentence the first person again for offences of which he or she was earlier convicted or to sentence that offender for the offences admitted but not charged. It is to do no more than give effect to the well-established principle (in this case established by statute) that the character and antecedents of the offender are, to the extent that they are relevant and known to the sentencing court, to be taken into account in fixing the sentence to be passed. Taking all aspects, both positive and negative, of an offender's known character and antecedents into account in sentencing for an offence is not to punish the offender again for those earlier matters; it is to take proper account of matters which are relevant to fixing the sentence under consideration.

68    In Markarian 228 CLR at 389–390 [83], McHugh J said:

… in Veen [No 2], as I have indicated, this Court affirmed that the ultimate control on the judicial sentencing discretion is the requirement that the sentence be proportionate to the gravity of the offence committed. In pursuit of other sentencing purposes, a judge may not impose a sentence that is greater than is warranted by the objective circumstances of the crime.

69    In Magaming v The Queen [2013] HCA 40; 252 CLR 381 at 397 [51] French CJ, Hayne, Crennan, Kiefel and Bell JJ said:

… The sentence imposed must be proportionate in the sense that it properly reflects the personal circumstances of the particular offender and the particular conduct in which the offender engaged when those circumstances and that conduct are compared with other offenders and offending.

70    From the above, there may possibly be seen to be a distinction between the “gravity” or seriousness of the offence and the “objective circumstances” of the offence: see Odgers S, Sentence (2nd ed, Longueville Media, 2013) at 112–118 [3.79]–[3.85]. The existence of the distinction may depend on the meaning of objective circumstances, as to which see R v Mulholland (1991) 1 NTLR 1; 102 FLR 465 at 478–791, referred to below. In any event, if the criminal history of an offender can increase the seriousness or gravity of the offence by illumination of moral culpability or a continuing attitude of disobedience to the law, it cannot be given such weight as to lead to the imposition of a penalty which is disproportionate to the gravity of the crime considered in the light of its objective circumstances: Veen (No 2) 164 CLR at 477 and Hoare 167 CLR at 354. So, even if the gravity of the crime can be affected by antecedent criminal history on one reading of Veen (No 2) (at 477 (including but not limited to the approval of Ottewell [1970] AC at 650) and at 478 by reference to Ibbs and through it Tait) would indicate, the sentence must be proportionate to that gravity considered in the light of the objective circumstances. Thus, the prior offending cannot unmoor or untether the sentence from the crime’s objective circumstances.

71    The view has been taken in New South Wales, by Spigelman CJ writing for the New South Wales Court of Criminal Appeal in R v McNaughton [2006] NSWCCA 242; 66 NSWLR 566 at 573 [22] (McClellan CJ at CL, Grove, Barr and Bell JJ concurring) that (notwithstanding considerations of the kind referred to above in the preceding paragraph) “prior convictions do not themselves play a role in determining the ‘gravity of the offence’ which, as Hoare confirms, turns on the ‘objective circumstances’ of the offence. This understanding is confirmed in Baumer.” This appears to be the accepted view in New South Wales: Gommesen v The Queen [2012] NSWCCA 226 at [1], [2] and [50]; Hillier v Director of Public Prosecutions (NSW) [2009] NSWCCA 312; 198 A Crim R 565 at [8]–[20]; Smith v The Queen [2011] NSWCCA 163 at [1], [26] and [72] (a case concerned with offences committed whilst the offender was on bail); Elhassan v The Queen [2018] NSWCCA 118 at [1], [2] and [13]–[14]; Tabbah v The Queen [2019] NSWCCA 324 at [1], [105] and [146]; and Gilshenan v The Queen [2019] NSWCCA 313 at [60] where the matter was put with clarity by Johnson J (on behalf of the Court, Macfarlan JA and Cavanagh J concurring):

The principles in Veen v The Queen (No. 2) and Baumer v The Queen (1988) 166 CLR 51; [1988] HCA 67 at [13]-[14] have been taken to establish that the principle of proportionality requires the upper boundary of a proportionate sentence to be set by the objective circumstances of the offence which circumstances do not encompass prior convictions: R v McNaughton (2006) 66 NSWLR 566; [2006] NSWCCA 242 at [24]. However, as was said in Veen v The Queen (No. 2), an antecedent criminal history is not relevant only to an offender’s claim of leniency. If an offender manifests in the commission of the offences for which sentence is to be passed “a continuing attitude of disobedience of the law”, then “retribution, deterrence and protection of society” play a part on sentence, although not in a manner which allows imposition of a sentence which is disproportionate to the objective gravity of the offences.

72    There was a clear disagreement with the above by RS Hulme J in Hillier at [107]–[110]. His Honour’s views that the record of prior offences could be taken into account in assessing the gravity of the offending were more in line with some of the cases referred to below, such as R v Omar (1991) 55 A Crim R 373, Mulholland and R v Young [1990] VR 951; 45 A Crim R 147. That disagreement recognised, however, that the relevance of the past offending could not take the sentence beyond the gravity judged by relevant factors which must (given Hoare) be considered in the light of the crime’s objective circumstances.

73    It may be thought, however, that merely to refer to “prior convictions” may mask the more relevant, and a more nuanced, question (being the one to which the plurality in Veen (No 2) at 477 referred) as to whether “antecedent criminal history is relevant … to show … whether the offender has manifested in [the] commission of the instant offence a continuing attitude of disobedience to the law”. The characterisation of such a consideration as not related to the gravity of the offence does not strike one as necessarily self-evident.

74    The view expressed in McNaughton, and the other New South Wales cases reflects the views of respected commentators: Fox R and Freiberg A, Sentencing: State and Federal Law in Victoria (2nd ed, Oxford University Press, 1999) at 227 [3.510] and the position in Victoria: R v O’Brien [1997] 2 VR 714 at 718 and Dirbass v The Queen [2018] VSCA 272 at [47]–[55].

75    A different approach to McNaughton has arisen from a wider view as to the meaning of the phrase “objective circumstances” in this context (reflecting perhaps what Wilson J said in Veen (No 2) at 486–87: “the ease with which obscurity of meaning can infect this area of discourse”). In this respect, the views of the Victorian Court of Criminal Appeal in Young [1990] VR 951 and the Northern Territory Court of Criminal Appeal in Mulholland (1991) 102 FLR 465 are relevant. In Young the Court (Young CJ, Crockett and Nathan JJ) rejected a two-stage approach based on a first stage excluding matters personal to the offender: see [1990] VR 954–960, especially 960. This rejection was not disapproved by Dawson, Toohey and Gaudron JJ in Bugmy v The Queen [1990] HCA 18; 169 CLR 525 at 535–536. That discussion by the Victorian Court of Criminal Appeal carried with it an implicit rejection of the proposition that the seriousness or gravity of the offending could be assessed without regard to considerations that were personal to the offender and which bore upon culpability: see [1990] VR at 960. In Mulholland, Angel J (with whom Asche CJ agreed) rejected the proposition that the circumstances of the instant offence which bore upon its gravity did not include prior offending. This view reflected the proposition that the circumstances of the crime, whether one calls them objective or not, include matters personal to the offender which can be seen to bear upon the gravity of the crime. The relevance of such matters was expressed as follows at 102 FLR 477–478 in rejecting a submission that prior offences could not be looked at in coming to a proportionate sentence from the objective circumstances of the offending:

I think there is an error in the submission and I think it is this: it overlooks that the previous offence of the respondent is a circumstance of the instant offence which bears upon the gravity of the instant offence.

Had a hypothetical disinterested bystander witnessed the respondent’s actions, his actus reus, he might have observed little different to the actus reus of the previous offence of the respondent. However, to say the hypothetical disinterested bystander observing only the actus reus, observes the circumstances of the offence is to ignore circumstances relevant to the criminal intent, the mens rea, of the respondent. The fact that the respondent was a convicted rapist at the time of the instant offence demonstrates, prima facie, an increased animus and culpability for the instant offence which ipso facto is deserving of greater punishment – and this is so quite apart from any question of a general propensity to re-offend after the time of sentencing. To impose a higher punishment a second time round is not a matter of adding anything to a so-called objective sentence; it is not a matter of punishing twice for the earlier offence: it is merely recognising that the prior offence is a circumstance relevant to the mens rea of the offender in committing the instant offence and that there is prima facie increased criminal culpability pertaining to the instant offence. The instant offence demonstrates an added disregard for the law, an added disregard for society in general and a further disregard for a particular member of society (the new victim) in particular. These matters reflect, in the absence of particular exculpatory facts, a more calculated animus in the case of the instant offence, and as I have said, this is so quite apart from any question of propensity to re-offend yet again. When courts speak of the circumstances of the offence they do not mean what the hypothetical disinterested bystander sees and hears at the scene. That is not exhaustive of the circumstances of the offence. The offence is constituted by the actus reus and the mens rea of the offender. So far as consideration of the mens rea of the offender is concerned, the hypothetical disinterested bystander is confined to what is said and done in his presence. There can be many factors relevant to the mens rea that are disclosed to the hypothetical disinterested bystander. The offender’s mental state at the time of the actus reus is not only to be inferred from the actus reus itself. It can be inferred as much from a proven pre-existing propensity to commit the offence as from a previously stated intention, made elsewhere, to commit the offence. When it is said the punishment must fit the crime, the punishment must fit both the actus reus and the mens rea constituting the crime. A pre-existing propensity to commit a like offence is relevant to the issue of mens rea of the instant offence. A propensity to re-offend in like manner yet again, attracts additional but different considerations apropos the protection of the public.

76    Justice Angel saw this approach as supported by Veen (No 2) at 477–478 and did not consider that anything in Baumer (HC) or Hoare was intended to qualify what had been said in Veen (No 2) at 477–478. In this respect Angel J disagreed with what Kearney J had said in Sultan v Svikart (1989) 96 FLR 457; 42 A Crim R 15 (see below). Justice Angel also drew support from Young [1990] VR at 960.

77    The above approach has not been reflected uniformly in the Northern Territory. Before Mulholland, in the remitted appeal of Mr Baumer in the Court of Criminal Appeal (R v Baumer (1989) 40 A Crim R 74 (Baumer (CCA))), Nader J expressed the matter in a manner conformable with the views of Angel J in Mulholland at 79:

It is permissible when considering the gravity of the offence itself to have regard to the appellant’s criminal record, not so as to increase an otherwise proper sentence, but as revealing, to some extent, the appellant’s state of mind at the time of the commission of the offence. His record tends to show him as a person who, when he offended, was somewhat contemptuous of any law to the contrary.

78    Justice Kearney, however, after referring to what the High Court had said in Baumer (HC), expressed the matter conformably with the New South Wales cases, as follows at 40 A Crim R 84–85:

It follows as a corollary that it is improper to increase a sentence beyond the upper limit called for by the circumstances of the crime, because of an accused’s criminal record. It is unjust to do so, because the accused would thereby be punished again for offences for which he had already been punished. However, the fact that an accused has a criminal record is a ground for refusing to mitigate the sentence called for by the circumstances of the offence; the rationale is that by his persistence in criminal conduct he may be regarded as not having responded to previous punishment, his prospects for rehabilitation may thus be regarded as poor, and the deterrent effect of some more moderate punishment negligible. An accused’s criminal record may also be treated as evidence of his character – a matter always in issue – and thus indicative of the extent to which society needs to be protected from him; it may also be treated as evidence of the nature and extent of any relevant intention.

…

I consider that his Honour’s observation that the appellant’s record “increases the seriousness of this particular offence” may fairly be construed in its context as indicating an approach to sentencing in which the appellant’s record was treated as a factor which increased the seriousness of the crime beyond that warranted by the circumstances of its commission. In the light of what the High Court said (Baumer at 345) such an approach involves appealable error in terms of House (1936) 55 CLR 499 at 505, vitiates the exercise of his Honour’s sentencing discretion, and enables this Court to exercise its own discretion in substitution.

79    After Baumer (CCA), Kearney J reiterated his views in Sultan v Svikart 96 FLR at 461–462, with which Angel J (and Asche CJ) disagreed in Mulholland. Justice Kearney maintained his views in Marshall v Llewellyn (1995) 79 A Crim R 49 at 53, saying:

It follows, I think, from the passage emphasised above that “the gravity of the instant offence’ which, in accordance with the proportionality principle stated in Veen (No 1) (1979) 143 CLR 458 controls the upper limit of the sentence which may be imposed, is to be assessed without taking into account “the antecedent criminal history of [the] offender”. The gravity of an offence is assessed by reference to its “objective circumstances”; see Hoare (1989) 167 CLR 348 at 354. They set the limit to the sentence which may be imposed; within that limit:

… the interplay of other relevant favourable and unfavourable factors – such as good character, previous offences, repentance, restitution, possible rehabilitation and intransigence – will point to what is the appropriate sentence in all the circumstances of the particular case

as Deane J put it in Veen (No 2) at 491; 249.

The “objective circumstances” exclude matters personal to the offender such as his prior criminal history. Insofar as the analysis by Angel J in Mulholland (1991) 102 FLR 465 at 477-479, with which Asche CJ agreed, may involve treating a prior criminal record as one of the “objective circumstances” of an offence, thereby raising the upper limit of the sentence which may be imposed, I respectfully disagree with it.

80    In reaching those views Kearney J drew support from King CJ in R v McInerney (1986) 42 SASR 111 at 113 and disagreed with the Full Court of this Court (Morling, Neaves and Foster JJ) in R v Omar (1991) 55 A Crim R 373 at 379–380, on appeal from the Supreme Court of the Australian Capital Territory, which had stated at 379:

Furthermore, Omar’s prior criminal record was relevant to an evaluation of the seriousness of the offence in respect of which sentence was being imposed. It was not relevant merely to subjective considerations weighing for or against leniency. It has been made clear in Veen (No 2) (1988) 164 CLR 465; 33 A Crim R 230 that this is the correct approach.

81    In Dixon v Price (1996) 135 FLR 27 at 30–31 Mildren J disagreed with Kearney J relying on Veen (No 2) at 477–478, saying:

In my view, it is entirely artificial to assess the criminality of an offender by excluding from the objective circumstances prior offences, where they illuminate the offender’s moral culpability for the instant offence. Indeed, it is common for the legislature in this Territory and elsewhere to prescribe higher maximum penalties where the offender has a prior conviction for the same offence. The moral culpability of this offender is, in my view, illuminated by the fact that he has five prior convictions for the same offence over a very short period and for which he has received sentences of imprisonment (including the maximum penalty) in the past.

The fact that a prisoner has a prior conviction for the same offence may be treated as part of the objective circumstances of the offences is recognised not only in Mulholland and Omar to which Kearney J referred, but also by the Court of Criminal Appeal when re-sentencing in R v Baumer (1989) 40 A Crim R 74 per Nader and Kearney JJ.

82    In Ellis v The Queen [2005] NTCCA 1; 154 A Crim R 450 at 455, R v Tyday [2006] NTSC 29 at [12] and R v Haji-Noor [2007] NTCCA 7; 21 NTLR 127, Angel J maintained his views.

83    In South Australia, the New South Wales position has been followed in Stokes v The Queen [2020] SASCFC 9 at [80] with express citation of, and agreement with, Gilshenan at [60] by Lovell J, with whom Peek J agreed. Absent statute, the position in South Australia was expressed before Veen (No 2) by King CJ in McInerney 42 SASR at 113, as follows:

… The cardinal rule is that while good character may operate to reduce the sentence which the facts of the crime would otherwise attract, bad character cannot increase it. A person is not to be punished, or punished again, for crimes other than the crime for which sentence is being passed. Offences committed prior to sentence for the offence under consideration may affect the sentence in two ways. They may diminish or abrogate any leniency by reason of good character. They may, moreover, lead to a greater sentence than would otherwise be imposed, although within the proper limits indicated by the facts of the immediate crime, for the purpose of personal deterrence; the prisoner's record may indicate that greater punishment is needed to protect the public by deterring him from further crime. Where the other offences have been committed before the commission of the immediate offence, their relevance is clear in the generality of cases. The offender has committed the offence not as a first offender but as a person whose character is affected by previous offending. He must be sentenced against the background of his record … The effect of the prior offences is more cogent if they have been the subject of conviction before the immediate offence. In such cases, the offender has committed the immediate offence notwithstanding the formal judgment and condemnation of the law in respect of the earlier offences and notwithstanding the warning as to the future which the conviction experience implies.

(Footnote omitted.)

84    The position of recidivism or serious repeat offending in South Australia is now provided for in s 54 of the Sentencing Act 2017 (SA) which specifically removes the requirement to impose a proportionate sentence.

85    In Western Australia, the relevant sentencing legislation (s 7(2) of the Sentencing Act 1995 (WA)) provides that an offence is not aggravated by a prior record. The expression of principle in the light of the provision has been in conformity with the approach in the New South Wales cases: Keating v Western Australia [2007] WASCA 98; 35 WAR 1 at 11–12 [35]–[36]; and Benter v Western Australia [2005] WASCA 245 at [30].

86    In Queensland, the relevant statutory provisions (ss 9 and 11 of the Penalties and Sentencing Act 1992 (Qld)) permit prior convictions to be used as an aggravating factor.

87    In Tasmania, the position is equivocal: Dobson v Tasmania [2017] TASCCA 19; 269 A Crim R 222 at 233–235 [28]–[34].

88    In the Australian Capital Territory, McNaughton is applied: Amos v McCarron [2017] ACTSC 6 at [72].

89    The elusiveness of the distinction between factors relevant to the offending and to the offender in assessing the seriousness or gravity of the crime was helpfully discussed by the New South Wales Court of Criminal Appeal (Spigelman CJ, Wood CJ at CL and Simpson J) in R v Way [2004] NSWCCA 131; 60 NSWLR 168 at 186–188 [86]–[99], albeit in the context of statutory standard non-parole periods. The Court recognised that some circumstances that go to the seriousness of the offence will be personal to the offender, but can nevertheless be said objectively to affect the seriousness of the offence because of their causal connection with its committal, such as motivation, duress, mental illness or disability, but “[o]ther matters which may be said to explain or influence the conduct of the offender or otherwise impinge on her or his moral culpability … are more accurately described as circumstances of the offender and not the offence”: 60 NSWLR at 187 [86]. The Court drew a distinction (eschewing the word “objective”) between “circumstances which go to the seriousness of the offence considered in a general way, and matters that are more appropriately directed to the objectives of punishment”: 60 NSWLR at 187 [90]. The Court viewed prior offences as more relevant to punishment: 60 NSWLR at 187 [92]. Though these matters were generally expressed the Court was dealing with statutory provisions dealing with standard non-parole periods. That meant the issue for general sentencing principles did not need to be settled; but the following comment was made (60 NSWLR at 188 [98]) that is of some importance:

Prior to enactment of legislation of the kind which is seen in Div 1A of Pt 4 [the standard non-parole provisions] it was probably not necessary for any strict line to be drawn between matters which related to the offence, and to the offender, respectively, since the focus was placed upon the question of setting a sentence that reflected the overall criminal culpability involved.

90    This rejection of the likely practical necessity to resolve a taxonomical debate parsing the words of Veen (No 2) recognises that, even if prior convictions can be taken into account in assessing the gravity or seriousness of the offending, the sentence is set by reference to all the circumstances, including the outward objective circumstances of the commission of the offence: that is, what happened. Thus prior convictions cannot distort the sentence to that which is disproportionate in the light of such objective circumstances of the offending (as opposed to the offender). The same point was made by Kourakis J (as the Chief Justice then was) in R v Bukvic [2010] SASC 195; 107 SASR 405 at 421 [75]–[76].

91    As pointed out by Mortimer J in Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union (No 2) [2016] FCA 436 at [77], the emphasis in criminal law for close correlation between the objective seriousness of the offending conduct and the proportionate response of the state in punishment is easily understood in the context of the deprivation of liberty by a term of imprisonment. As is discussed later, the context of monetary penalties used in a regulatory context to extract compliance with a statute by deterrence may allow for a wider notion of what is considered to be proportionate or appropriate.

92    Before turning to the statute, it should be noted that the principle of proportionality in Veen (No 2) can be seen to have two informing considerations that were not tied to retribution (as distinct from deterrence): first, the deterrence was in respect of offences “of a like kind”: 164 CLR at 477; and, secondly, the maximum penalty assisted to shape the punishment for such kind of offending. These two features were not wholly dependent upon the retributive source or upon a source of moral delinquency. They can be seen to survive the rejection of retribution as an object of the imposition of civil penalties. They can be seen as part of the reasonableness of the response of state power under statute to regulate conduct, deriving from the content of the statute authorising lawful (judicial) power to impose penal consequences to deter prohibited conduct.

93    In the criminal law, the principle of proportionality remains relevant even when the principle purpose of the sentence being imposed is deterrence: Eldridge v Bates [1989] SASC 1268; 51 SASR 532 at 533–534 (King CJ), discussed by the Full Court in Police v Cadd [1997] SASC 6187; 69 SASR 150; Birch v Fitzgerald (1975) 11 SASR 114 at 116–117 (Bray CJ); and R v Thompson (1975) 11 SASR 217 at 222 (Bray CJ).

The statutory provisions

94    The source of the court’s power to impose a penalty is s 546 of the Act. Section 546 finds its place in Subdiv B of Div 2 of Pt 4–1 of Ch 4 of the Act, which is constituted by ss 545, 546 and 547, which relevantly are as follows:

545     Orders that can be made by particular courts

Federal Court and Federal Circuit Court

(1)    The Federal Court or the Federal Circuit Court may make any order the court considers appropriate if the court is satisfied that a person has contravened, or proposes to contravene, a civil remedy provision.

(2)    Without limiting subsection (1), orders the Federal Court or Federal Circuit Court may make include the following:

(a)    an order granting an injunction, or interim injunction, to prevent, stop or remedy the effects of a contravention;

(b)     an order awarding compensation for loss that a person has suffered because of the contravention;

(c)     an order for reinstatement of a person.

Eligible State or Territory courts

(3)    An eligible State or Territory court may order an employer to pay an amount to, or on behalf of, an employee of the employer if the court is satisfied that:

(a)     the employer was required to pay the amount under this Act or a fair work instrument; and

(b)    the employer has contravened a civil remedy provision by failing to pay the amount.

(3A)     An eligible State or Territory court may order an outworker entity to pay an amount to, or on behalf of, an outworker if the court is satisfied that:

(a)    the outworker entity was required to pay the amount under a modern award; and

(b)     the outworker entity has contravened a civil remedy provision by failing to pay the amount.

When orders may be made

(4)    A court may make an order under this section:

(a)     on its own initiative, during proceedings before the court; or

(b)     on application.

Time limit for orders in relation to underpayments

(5)    A court must not make an order under this section in relation to an underpayment that relates to a period that is more than 6 years before the proceedings concerned commenced.

546     Pecuniary penalty orders

(1)    The Federal Court, the Federal Circuit Court or an eligible State or Territory court may, on application, order a person to pay a pecuniary penalty that the court considers is appropriate if the court is satisfied that the person has contravened a civil remedy provision.

Determining amount of pecuniary penalty

(2)    The pecuniary penalty must not be more than:

(a)     if the person is an individual—the maximum number of penalty units referred to in the relevant item in column 4 of the table in subsection 539(2); or

(b)     if the person is a body corporate—5 times the maximum number of penalty units referred to in the relevant item in column 4 of the table in subsection 539(2).

Payment of penalty

(3)    The court may order that the pecuniary penalty, or a part of the penalty, be paid to:

(a)     the Commonwealth; or

(b)     a particular organisation; or

(c)     a particular person.

Recovery of penalty

(4)    The pecuniary penalty may be recovered as a debt due to the person to whom the penalty is payable.

No limitation on orders

(5)    To avoid doubt, a court may make a pecuniary penalty order in addition to one or more orders under section 545.

547     Interest up to judgment

(1)    This section applies to an order (other than a pecuniary penalty order) under this Division in relation to an amount that a person was required to pay to, or on behalf of, another person under this Act or a fair work instrument.

(2)    In making the order the court must, on application, include an amount of interest in the sum ordered, unless good cause is shown to the contrary.

(3)    Without limiting subsection (2), in determining the amount of interest, the court must take into account the period between the day the relevant cause of action arose and the day the order is made.

95    If a contravention of a civil remedy provision is threatened or has occurred the court is given wide power to make orders, such as: any order the court considers appropriate: s 545(1); injunctive relief to prevent, or remedy the effects of a contravention: s 545(2)(a); compensation for loss a person has suffered because of the contravention: s 545(2)(b); reinstatement: s 545(2)(c); or a pecuniary penalty that is considered appropriate if satisfied of contravention: s 546(1), including the imposition of a personal payment order, the power for which is implied within s 546(1): Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union [2018] HCA 3; 262 CLR 157 (Non-Indemnification Case (HC)).

96    Some of these provisions (without being completely mutually exclusive) are compensatory, some are preventative and protective, and one is penal. The regime is statutory and, as is obvious, but nevertheless worthy of repetition, it is for Parliament to set the level of penalty to be imposed by the courts by reference to known principles guiding the imposition of penalties. As Allsop CJ said in Construction, Forestry, Mining and Energy Union v Australian Building and Construction Commissioner [2016] FCAFC 184; 247 FCR 339 (1st Non-Indemnification Personal Payment Case (FC)) at 343 [14] in the context of explaining why his Honour did not think that s 545(1) was a valid source of power for an order against the union preventing it from paying any penalty imposed on the union official (as opposed to s 546 as found by the High Court to be the source of power to require the contravening party to pay the penalty and not seek or accept indemnification from the union):

None of the above should be seen as an encouragement to any person or organisation to act in defiance of the law, or any condonation of such conduct. If a penalty is to be seen as a price on contravention that is sufficiently high to deter repetition by a contravenor, and that object is not being fulfilled, the answer may lie in the inadequacy of the penalty. It is a matter for Parliament to set the penalty and to set the consequences of repeated contravention. The imposition of penalties is not the only mechanism for requiring and exacting obedience to the law. If an organisation or a person is behaving in a way that would indicate an unwillingness to obey a Commonwealth statute and such conduct could be seen as likely to repeat itself, injunctive relief may be available. Section 545(2)(b) provides for an order awarding compensation for loss that a person has suffered because of a contravention. The interruption of a concrete pour on a building site leading to the necessity to remove the partially laid concrete and to repeat the otherwise expensive exercise might well be the foundation for an order for compensation.

97    There is no basis to construe s 546 other than as the source of power in the court to impose a civil penalty for a stated and proven contravention. There is no reason (textually or contextually derived) to construe the provision as empowering a court to impose more than one penalty for a proven contravention. The words do not permit multiple penalties for the same contravention. This approach has been universal to the imposition of civil penalties and underlies the body of jurisprudence on the so-called “course of conduct” principle, as to which cases see [116] below.

98    The court’s task is to determine and impose a penalty that it considers “appropriate” if it is satisfied that a person upon whom the penalty is to be imposed has contravened a civil remedy provision. That task is to be undertaken in the light of the object or purpose of the imposition: the promotion of the public interest in compliance with the provision of the statute in question, by deterrence, specific and general. It is clear that the object of deterrence is directed to the subject contravention. That is, it is the deterring of contraventions of the kind before the court to which regard must be had in fixing the penalty that is considered appropriate, by reference to the frame of reference or yardstick provided by the maximum penalty as set by Parliament. Thus, it will always be important to understand the nature, character and full context of the contravening.

The appropriate penalty

99    The kinds of consideration to be taken into account to which French J referred in CSR (1991) ATPR ¶41-076 at 52,152–52,153 were:

1.    The nature and extent of the contravening conduct.

2.    The amount of loss or damage caused.

3.    The circumstances in which the conduct took place.

4.    The size of the contravening company.

5.    The degree of power it has, as evidenced by its market share and ease of entry into the market.

6.    The deliberateness of the contravention and the period over which it extended.

7.    Whether the contravention arose out of the conduct of senior management or at a lower level.

8.    Whether the company has a corporate culture conducive to compliance with the Act, as evidenced by educational programs and disciplinary or other corrective measures in response to an acknowledged contravention.

9.    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.

Other cases have similarly expressed lists of possible relevant considerations: see for example, Santow J in Australian Securities and Investment Commission v Adler [2002] NSWSC 483; 42 ACSR 80 at [126] and Tracey J in Kelly v Fitzpatrick [2007] FCA 1080; 166 IR 14 at 18–19 [14]. To the list of French J may be added, to the extent that it is not inherent within his Honour’s list, the apparent attitude of the contravenor to compliance with the relevant law of Parliament. Such lists are (unless found in a relevant statutory provision) not legal check lists. They are judicial descriptions of likely relevant considerations applicable to the task of coming to an appropriate penalty in the circumstances of varied cases, for the object of deterrence of contraventions of like kind set against the statutory maximum penalty. As Buchanan J said in Australian Ophthalmic Supplies Pty Ltd v McAlary-Smith [2008] FCAFC 8; 165 FCR 560 at 580 [91] such lists are useful as long as they “do not become transformed into a rigid catalogue of matters for attention. … [T]he task of the Court is to fix a penalty that pays appropriate regard to the circumstances in which the contraventions have occurred and the need to sustain public confidence in the statutory regime which imposes the obligations”. As Gyles J said in A & L Silvestri Pty Limited v Construction, Forestry, Mining and Energy Union [2008] FCA 466 at [6] the factors are not mandatory criteria and can lead to over-elaborate reasoning for a task that is a discretion at large as to what is appropriate to the object concerned.

100    The setting out of such factors is of assistance, however, not only in capturing relevant matters, but also in providing the necessary focus: that it is to the contravention in question to which the penalty is directed. This is not because there is a retributive principle that there must be equality between act and punishment for the crime, but because the contravention (and its nature, quality and seriousness) must be considered and understood such that the appropriate penalty be imposed to deter such a contravention in the future. The features of the contravention that can be seen to be relevant to its seriousness will find their place, not in the operation of some freestanding retributively-derived principle of proportionality, but in understanding the degree of deterrence necessary to be reflected in the size of the penalty: Flight Centre Limited v Australian Competition and Consumer Commission (No 2) [2018] FCAFC 53; 260 FCR 68 at 86 [71]. Importantly, however, the imposition of an appropriate penalty, given the object of deterrence, does not authorise and empower the imposition of an oppressive penalty that is one that is more than is appropriate to deter a contravention of the kind before the court. The primacy of the object of deterrence does not unmoor or untether the consideration of appropriateness from the circumstances and the contravention before the court and what is reasonably necessary to deter contraventions of the kind before the court. Notions of reasonableness inhering in statutes as part of the principle of legality would deny a construction that sought to do so, at least without the clearest language. Any such construction would entail the risk of personal predilection, not principle, guiding the imposition of penal sanction with necessary attendant problems of inconsistency, a consequence not to be attributed to Parliament. As Burchett and Kiefel JJ said in NW Frozen Foods Pty Ltd v Australian Competition and Consumer Commission [1996] FCA 1134; 71 FCR 285 at 293:

As Smithers J emphasised in Stihl Chain Saws (at 17,896), insistence upon the deterrent quality of a penalty should be balanced by insistence that it “not be so high as to be oppressive”. Plainly, if deterrence is the object, the penalty should not be greater than is necessary to achieve this object; severity beyond that would be oppression.

101    As Toohey J put the matter in Trade Practices Commission v Mobil Oil Australia Limited [1984] FCA 403; 4 FCR 296 at 298:

The penalty should be such as to deter not only the particular offender but others who may be disposed to engage in prohibited conduct of a similar kind.

(Emphasis added.)

102    The balance of an appropriate penalty to deter, but not be oppressive in respect of the instant contravention has the authority of Full Courts in NW Frozen Foods; Australian Competition and Consumer Commission v Dataline.Net.Au Pty Ltd (in liquidation) [2007] FCAFC 146; 161 FCR 513 at 527 [58]; Singtel Optus Pty Ltd v Australian Competition and Consumer Commission [2012] FCAFC 20; 287 ALR 249 at 264 [60]; and Australian Competition and Consumer Commission v Reckitt Benckiser (Australia) Pty Ltd [2016] FCAFC 181; 340 ALR 25 at 61 [152]. It is appropriate to set out what the Full Court said in Reckitt Benckiser expressed as it was after, and taking account of, the High Court’s clear direction in the Agreed Penalties Case (HC) at 258 CLR 506 [55]. The Full Court said the following in Reckitt Benckiser at 340 ALR 61 [152]:

If it costs more to obey the law than to breach it, a failure to sanction contraventions adequately de facto punishes all who do the right thing. It is therefore important that those who do comply see that those who do not are dealt with appropriately. This is, in a sense, the other side of deterrence, being a dimension of the general deterrence equation. This is not to give licence to impose a disproportionate or oppressive penalty, which cannot be done, but rather to recognise that proportionality of penalty is measured in the wider context of the demands of effective deterrence and encouraging the corresponding virtue of voluntary compliance.

103    The question is what can reasonably be thought to be appropriate to serve as a real deterrent and “must be fixed with a view to ensuring that the penalty is such as not to be regarded … as an acceptable cost of doing business”: Australian Competition and Consumer Commission v TPG Internet Pty Ltd [2013] HCA 54; 250 CLR 640 at 659 [66] referring to Singtel Optus 287 ALR at 265 [62]–[63].

104    These considerations must be assessed, now, in the clear light of the instruction of the High Court in the Agreed Penalties Case (HC) 258 CLR at 506 [55]. If one accepts, as in our view one must by a reading of s 546 in the light of the Agreed Penalties Case (HC), that the penalty is imposed to deter, that it is imposed for the instant contravention and not for past (already penalised) contraventions or past (unpenalised, but unpleaded) contraventions, and (as one takes from s 546 and from the Full Court decisions set out at [98] above) that the penalty is set at what is considered appropriate to deter contravention of such kind, guided by the statutory maximum penalty, but not at a level reasonably thought to exceed that purpose and thus be oppressive, one sees a notion of proportionality within the task set out in s 546. That task, of course, is the imposing of an “appropriate” penalty for the instant contravention to serve the object of deterrence from repetition of like contravening in the future. Proportionality and appropriateness are thus intimately related. Proportionality is not a free-standing principle separate from the requirement of what is “appropriate”, rather it is part of that assessment which will necessarily involve examining the nature of the contravention, and all factors that rationally bear on the assessment of the need for deterrence in all the circumstances.

105    The setting of a maximum penalty by Parliament is a part of such a notion of proportionality. Parliament is to be taken to be setting the maximum penalty for cases in which the need for deterrence is strongest, as it is in crime intended for the worst type of case. If the penalty is to be appropriate for the object of deterrence in relation to contravention of the kind before the court the various considerations that bear on the question must display such features as warrant the evaluative conclusion that the penalty is appropriate. The place of the maximum penalty was discussed by the Full Court in Reckitt Benckiser (after the Agreed Penalties Case (HC)), as follows at 340 ALR 61 [154]–[156]:

154 In considering the sufficiency of a proposed civil penalty, regard must ordinarily be had to the maximum penalty. In Markarian, a criminal sentencing context, it was observed at [31] that:

careful attention to maximum penalties will almost always be required, first because the legislature has legislated for them; secondly, because they invite comparison between the worst possible case and the case before the court at the time; and thirdly, because in that regard they do provide, taken and balanced with all of the other relevant factors, a yardstick.

155 The reasoning in Markarian about the need to have regard to the maximum penalty when considering the quantum of a penalty has been accepted to apply to civil penalties in numerous decisions of this Court both at first instance and on appeal (Director of Consumer Affairs, Victoria v Alpha Flight Services Pty Ltd [2015] FCAFC 118 at [43]; Australian Competition and Consumer Commission v BAJV Pty Ltd [2014] FCAFC 52 at [50]–[52]; Setka v Gregor (No 2) (2011) 195 FCR 203; [2011] FCAFC 90 at [46]; McDonald v Australian Building and Construction Commissioner (2011) 202 IR 467; [2011] FCAFC 29 at [28]–[29]). As Markarian makes clear, the maximum penalty, while important, is but one yardstick that ordinarily must be applied.

156 Care must be taken to ensure that the maximum penalty is not applied mechanically, instead of it being treated as one of a number of relevant factors, albeit an important one. Put another way, a contravention that is objectively in the mid-range of objective seriousness may not, for that reason alone, transpose into a penalty range somewhere in the middle between zero and the maximum penalty. Similarly, just because a contravention is towards either end of the spectrum of contraventions of its kind does not mean that the penalty must be towards the bottom or top of the range respectively. However, ordinarily there must be some reasonable relationship between the theoretical maximum and the final penalty imposed.

106    It is important not to allow the language of the transposed principles of criminal law to deflect the proper considerations for the imposition of civil penalties. To speak of the “worst possible case” properly directs one to the circumstances of the contravention before the court, but it is difficult to see why the objective facts of the case alone (without regard to the circumstances of the contravenor) should determine this characterisation. In criminal sentencing the clear principle of proportionality, on one view, may require that limitation: McNaughton. On another view in criminal sentencing, the objective circumstances and the gravity of the offending are assessed by reference to circumstances of the offender as well as the offence: Omar, Mulholland and cf Tait. As remarked in Way 60 NSWLR at 188 [98] it may make little practical difference whether prior offending goes to the gravity of the offending or to the choice of the level of punishment. It may not be a point of substantive difference, but the place of the maximum penalty for the imposition of civil penalties may be better expressed as for circumstances, including the nature and gravity of the contravention, that warrant or call for the highest possible level of deterrence as reasonably appropriate. The judicial discretion as to the fixing of an appropriate civil penalty for the object of obtaining compliance through deterrence must be exercised reasonably. Speaking in a different context found in the Public Service Act 1999 (Cth), Kiefel CJ, Bell, Keane and Nettle JJ said the following in Comcare v Banerji [2019] HCA 23; 372 ALR 42 at 57–58 [40]:

Section 15 of the Public Service Act provides for a range of penalties and for the selection and imposition of the appropriate penalty by the Agency Head in the exercise of discretion. As a matter of law, that discretion must be exercised reasonably [Minister for Immigration and Citizenship v Li (2013) 249 CLR 332 at 348-349 [23]-[24] per French CJ, 362 [63] per Hayne, Kiefel and Bell JJ, 370-371 [88]-[89] per Gageler J; [2013] HCA 18] and, therefore, according to the nature and gravity of the subject contravention [Li (2013) 249 CLR 332 at 352 [30] per French CJ, 366-367 [74]-[76] per Hayne, Kiefel and Bell JJ. See and compare House v The King (1936) 55 CLR 499 at 504-505 per Dixon, Evatt and McTiernan JJ; [1936] HCA 40; Veen v The Queen (No 2) (1988) 164 CLR 465 at 472 per Mason CJ, Brennan, Dawson and Toohey JJ; [1988] HCA 14]. As with other civil penalties, the essence of the task is to put a price on the contravention sufficiently high to deter repetition by the contravenor and others who might be tempted to contravene [Commonwealth v Director, Fair Work Building Industry Inspectorate (2015) 258 CLR 482 at 506 [55] per French CJ, Kiefel, Bell, Nettle and Gordon JJ; [2015] HCA 46, quoting Trade Practices Commission v CSR Ltd (1991) ATPR ¶41-076 at 52,152 per French J], but bearing in mind that a penalty of dismissal must not be “harsh, unjust or unreasonable” [See Fair Work Act 2009 (Cth), Pt 3.2]. Unquestionably, there are cases of breach of s 13(11) that are so serious in the damage done to the integrity and good reputation of the APS that the only appropriate penalty is termination of employment. The instance earlier cited of a Permanent Secretary who publicly engages in trenchant criticism of the Secretary's Minister, Government policy or departmental administration is an obvious example. By contrast, in other cases the level of the employee involved and the nature of the conduct in issue may be such that nothing more than a reprimand is warranted. And of course between those two extremes lies a range of possible situations warranting the imposition in the reasonable exercise of discretion of differing penalties according to the particular facts and circumstances of the matter. It is not the case that every employee of the APS who commits a breach of s 13(11) by broadcasting public “anonymous” communications is liable to be dismissed. Nor is it the case that the impugned provisions provide for the imposition of a penalty which is not proportionate to the contravention. Breach of the impugned provisions renders an employee of the APS liable to no greater penalty than is proportionate to the nature and gravity of the employee's misconduct.

(Emphasis added.)

These notions inhere equally in the exercise of judicial power.

107    The relevance of proportionality in the imposition of an appropriate civil penalty is not dependent upon notions of retribution as in the criminal law. Retribution may be seen to be the, or a, source or derivation of the principle of proportional punishment in the criminal law. A notion of proportionality inheres, however, in the notion of the reasonableness of an appropriate judicial response to contraventions of the law in the imposition of a civil penalty in order to further the object of deterrence and compliance with the relevant legislation. This is not to insert a separate principle distinct from the statutory task of fixing what is considered to be an appropriate penalty for the contravention in question to further the object of deterrence and compliance. It is not a label on a group of considerations separate from others which must first be addressed before a second or subsequent stage of analysis be undertaken. It is part of the “balance” between the “insistence upon the deterrent quality of the penalty” and the “insistence” that the penalty not be greater than is necessary to achieve the object of deterrence, for such would not be deterrence but “oppression”: see NW Frozen Foods 71 FCR at 293 ([96] above). In the same case, after discussing measures or features that might ameliorate a penalty, Burchett and Kiefel JJ said at 71 FCR 294–295:

There are, of course, limits to the approach accepted in these cases. The Court should not leave room for any impression of weakness in its resolve to impose penalties sufficient to ensure the deterrence, not only of the parties actually before it, but also of others who might be tempted to think that contravention would pay, and detection lead merely to a compliance program for the future.

108    The demonstrated willingness (and its degree or strength) of a contravenor to disobey the law (however that is derived admissibly) is or must be of significance to the assessment of what is reasonably appropriate in order to deter and within that task to what is proportionate. There is not more than one task called for by the statute. If we may respectfully adopt at this point what was said by Charlesworth J in Director of the Fair Work Building Industry Inspectorate v Robinson [2016] FCA 525; 241 FCR 338 at 351 [66]–[69] in a case after the Agreed Penalties Case (HC):

66 Once it is accepted that civil penalties are not retributive, concepts of proportionality should not be applied for the purposes of serving broader objectives of punishment in the sense described in R v Hunter (1984) 36 SASR 101 at 103 (King CJ) (applied by Lander J in Ponzio (at [93])):

The basic concepts of justice which underlie the criminal law require that the punishment be fairly proportionate to the crime in accordance with the prevailing standards of punishment. Only when it meets that criterion can a sentence satisfy the sense of justice of the community which is expected in the criminal law and in the practice of the courts in applying the criminal law.

67 Proportionality is nonetheless a critical objective in exercising the discretion conferred by s 546 of the FW Act. That is because the degree of seriousness of a contravention is relevant to ascertain “the assessment of a penalty of appropriate deterrent value”: CSR at [42]. A penalty of appropriate deterrent value is one that recognises that the maximum penalties prescribed in the statute are appropriately imposed in cases where the need for deterrence is the most pronounced. There remains, in addition, a discretion not to impose a penalty at all if the statutory purpose of deterrence would not be served by the imposition of one.

68 The seriousness of the conduct constituting the contravention is an important indicator of the need for deterrence in a particular case, but is not the sole indicator. Consistent with the reasoning of French J (as he then was) in CSR, in all cases it is proportionality in relation to the need for deterrence that must be achieved, having regard to all relevant circumstances, including the objective seriousness of the contravention before the Court.

69 It should also be recognised that penalties fixed for a deterrent purpose are intended to have an attitudinal effect: dissuasion. It is for this reason that any assessment of the seriousness of the conduct of the respondents places appropriate emphasis on the mental attitudes accompanying their physical acts.

(Emphasis added.)

109    Notwithstanding the continued relevance of the notion of proportionality in considering and fixing an appropriate penalty for a contravention with the object of deterrence, the recognition of the irrelevance of considerations such as retribution, denunciation and rehabilitation in the context of possible loss of liberty, and the recognition that the imposition of the penalty is the setting of a price to dissuade the contravenor and others from contravening in like manner in the future makes clearer the whole overall process of arriving at the evaluative conclusion of an appropriate penalty to fulfil the object of deterrence. The process is whole and discretionary, and evaluative in character, to which objective aspects of the contravention and what might be called the subjective characteristics of the contravenor, indeed all considerations that rationally touch on or inform deterrence, are relevant. As Charlesworth J said in Robinson above, the mental attitude of the contravenor is relevant: whether innocent, or whether reflective of a determined refusal to comply with, or of a determination to be disobedient to, the law, or whether some other characteristic relevant in some other way that can be seen to bear on the assessment of the need for, and required degree of, deterrence.

110    Thus, it would be wrong to approach the matter by first fixing a so-called range drawn from only some of the considerations that can be seen to be relevant to deterrence, being only those that can be said to be the “objective” features of the contravention said to establish its objective gravity, and then, only at a second stage, applying so-called “subjective” considerations concerning the contravenor that naturally and rationally bear upon the assessment of the need for deterrence of that person (including any demonstrated unwillingness to defy or disobey the law), to determine a penalty within that already fixed range. Such a process would tend to introduce a competing informing purpose or object, other than deterrence, to the assessment, to reintroduce a retributive consideration in the first stage of consideration by using the objective nature of the contravening as the central or controlling feature of the process, making the imposition of the penalty akin to punishment (in the retributive sense) for the (objective) nature of the crime committed. This approach would see the objective characteristics of the actions of contravening (through a principle of proportionality based only on the objective features of the contravention) made a distinct and governing consideration for the setting of what is legally available as appropriate to deter, when the notion of (at least specific) deterrence is best understood by reflecting on the attitude or willingness of the contravenor to obedience or disobedience to the provision or type in question. That said it cannot be lost sight of that the imposition is for the contravention in question which is made up of the constitutive facts that occurred, being the acts and any mental state provided for by the statute as contravening conduct, in aid of deterrence from contraventions of that kind.

111    Proportionality is relevant not because a notion of retribution is being expressed or manifested in a free-standing principle, but because of a balance in the reaching of an “appropriate” penalty between an “insistence” on deterrence and an “insistence” on not imposing more than is reasonably necessary (NW Frozen Foods) as part of the reasonable and lawful exercise of judicial power (cf Banerji) in respect of a contravention before the court and in furtherance of the object of deterrence of contraventions of like kind.

112    Whilst the process is no longer what might be called a Markarian instinctive synthesis of features or objects of sentencing such as retribution, denunciation, rehabilitation and deterrence, the approach in Markarian remains relevant as a convenient way to express an evaluative process to which many factors may be relevant in reaching a conclusion of an appropriate penalty necessary in the circumstances for the object of deterrence, without exceeding what is reasonably necessary and thus becoming oppressive, in respect of a contravention of a kind before the court.

The course of authority since the Agreed Penalties Case (HC)

113    Against this background, it is necessary to say something of a number of Full Court decisions at the centre of the arguments on the appeal, including those raised by the notice of contention.

114    After the High Court decided the Agreed Penalties Case (HC) in December 2015, the matter was remitted to the Full Court for the imposition of penalty. The matter was heard in May 2016, and judgment delivered in August 2017: Queensland Infrastructure Case (2017) 254 FCR 68. The matter had been before a Full Court in the original jurisdiction of the Court in the Agreed Penalties Case (FC) pursuant to a direction under s 20(1A) of the Federal Court of Australia Act 1976 (Cth) given the important question of the applicability, or not, of the principle in Barbaro. That question having been resolved by the High Court, which in doing so settled the question as to the statutory object or purpose of the imposition of a civil penalty, in accordance with the line of authority reflected by CSR and NW Frozen Foods, the matter came back to the Full Court (Dowsett, Greenwood and Wigney JJ) for imposition of penalties. Their Honours set out what they perceived to be relevant general principles. The discussion should be read and understood in the context that there was “effectively no dispute” about them: see [97]. They were expressed to be a “brief discussion” drawn from Australian Competition and Consumer Commission v Australia and New Zealand Banking Group Ltd [2016] FCA 1516; 118 ACSR 124, but importantly they were expressed in the light of the High Court’s recent expression of view. At 254 FCR 88–90 [98]–[107], their Honours said the following:

98 Whereas criminal penalties import notions of retribution and rehabilitation, the purpose of a civil penalty is primarily, if not wholly, protective in promoting the public interest in compliance: Trade Practices Commission v CSR Ltd [1991] ATPR 41-076 at 52,152; Commonwealth v Director, FWBII at [55] (per French CJ, Kiefel, Bell, Nettle and Gordon JJ). The principal object of a pecuniary penalty is to attempt to put a price on contravention that is sufficiently high to deter repetition by the contravenor and by others who might be tempted to contravene; both specific and general deterrence are important: Chemeq at [90]; Ponzio at [93]. A pecuniary penalty for a contravention of the law must be fixed with a view to ensuring that the penalty is not to be regarded by the offender or others as an acceptable cost of doing business: Australian Competition and Consumer Commission v TPG Internet Pty Ltd (2013) 250 CLR 640 (TPG Internet) at [66]; Singtel Optus Pty Ltd v Australian Competition and Consumer Commission (2012) 287 ALR 249 at [62]-[63]. In relation to general deterrence, it is important to send a message that contraventions of the sort under consideration are serious and not acceptable: Australian Securities and Investments Commission v Southcorp Ltd (2003) 130 FCR 406 at [32].

99 The question whether a pecuniary penalty involves an element of punishment remains somewhat controversial: see the discussion in Australian Competition and Consumer Commission v Cement Australia Pty Ltd (2016) 242 FCR 389 at [76]; ACCC v ANZ at [78]-[83]; Construction, Forestry, Mining and Energy Union v Australian Building and Construction Commissioner (2016) 247 FCR 339 at [8], referring to NW Frozen Foods Pty Ltd v Australian Competition and Consumer Commission (1996) 71 FCR 285 (NW Frozen Foods) at 296-297; Australian Competition and Consumer Commission v Australian Safeway Stores Pty Ltd (1997) 75 FCR 238 at 241; Trade Practices Commission v Stihl Chain Saws (Aust) Pty Ltd [1978] ATPR 40-091 (Stihl Chain Saws) at 17,896; Australian Competition and Consumer Commission v Ithaca Ice Works Pty Ltd [2002] ATPR 41-851 at [50]. To a certain extent, that debate appears to be more semantic or philosophical than real. It is sufficient to say that, accepting that the primary purpose of imposing a pecuniary penalty is to protect and deter, that purpose is achieved by imposing a punishment in the form of a pecuniary penalty: ACCC v ANZ at [83].

100 The fixing of a pecuniary penalty involves the identification and balancing of all the factors relevant to the contravention and the circumstances of the defendant, and making a value judgment as to what is the appropriate penalty in light of the protective and deterrent purpose of a pecuniary penalty. While there may be differences between the criminal sentencing process and the process of fixing a pecuniary penalty (cf Commonwealth v Director, FWBII at [56]-[57]), the fixing of a pecuniary penalty may to an extent be likened to the “instinctive synthesis” involved in criminal sentencing: TPG Internet Pty Ltd v Australian Competition and Consumer Commission (2012) 210 FCR 277 at 294. Instinctive synthesis is the “method of sentencing by which the judge identifies all the factors that are relevant to the sentence, discusses their significance and then makes a value judgment as to what is the appropriate sentence given all the factors of the case”: Markarian v The Queen (2005) 228 CLR 357 (Markarian) at [51] (per McHugh J). Or, as the plurality put it in Markarian (at [37], per Gleeson CJ, Gummow, Hayne and Callinan JJ) “the sentencer is called on to reach a single sentence which … balances many different and conflicting features”. Like the exercise of imposing a sentence for an offence, the process of fixing an appropriate pecuniary penalty should not be approached as a mathematical exercise involving increments to or decrements from a predetermined range of sentences: Wong v The Queen (2001) 207 CLR 584 at [74]-[76].

101 In fixing the amount of a civil penalty, reference is frequently made to the lists of factors or considerations identified by Santow J in Australian Securities and Investments Commission v Adler (2002) 42 ACSR 80 at [126] and French J in Chemeq at [99]. Those lists of relevant considerations, which have been approved and elaborated on by many subsequent decisions of this Court, were not, and plainly were not intended to be, exhaustive. Nor was it suggested that each of the factors referred to in the respective lists was necessarily relevant or important in every case. These lists of factors should not be treated as a rigid catalogue or checklist of matters to be applied in each case; the overriding principle is that the Court should weigh all relevant circumstances: Australian Securities and Investments Commission v GE Capital Finance Australia [2015] ASC 155-203 at [72].

102 In general terms, the factors that may be relevant when fixing a pecuniary penalty may conveniently be categorised according to whether they relate to the objective nature and seriousness of the offending conduct, or concern the particular circumstances of the defendant in question.

103 The factors relating to the objective seriousness of the contravention include: the extent to which the contravention was the result of deliberate, covert or reckless conduct, as opposed to negligence or carelessness; whether the contravention comprised isolated conduct, or was systematic or occurred over a period of time; if the defendant is a corporation, the seniority of the officers responsible for the contravention; the existence, within the corporation, of compliance systems and whether there was a culture of compliance at the corporation; the impact or consequences of the contravention on the market or innocent third parties; and the extent of any profit or benefit derived as a result of the contravention.

104 The factors that concern the particular circumstances of the defendant, particularly where the defendant is a corporation, generally include: the size and financial position of the contravening company; whether the company has been found to have engaged in similar conduct in the past; whether the company has improved or modified its compliance systems since the contravention; whether the company (through its senior officers) has demonstrated contrition and remorse; whether the company had disgorged any profit or benefit received as a result of the contravention, or made reparation; whether the company has cooperated with and assisted the relevant regulatory authority in the investigation and prosecution of the contravention; and whether the company has suffered any extra-curial punishment or detriment arising from the finding that it had contravened the law.

105 Where the defendant is a body corporate, the size of the body does not of itself justify a higher penalty than might otherwise be imposed: Australian Competition and Consumer Commission v Coles Supermarkets Australia Pty Ltd (2015) 327 ALR 540 (Coles Supermarkets) at [89]-[92]. The size of the corporation may, however, be particularly relevant in determining the size of the pecuniary penalty that would operate as an effective deterrent. The sum required to achieve that object will generally be larger where the company has vast resources: Australian Competition and Consumer Commission v Leahy Petroleum Pty Ltd (No 3) (2005) 215 ALR 301 at [39]; Australian Competition and Consumer Commission v Apple Pty Ltd [2012] ATPR 42-404 at [38].

106 Careful attention must also be given to the maximum penalty for the contravention. That is so for at least three reasons: first, because the legislature has legislated for the maximum penalty and it is therefore an expression of the legislature’s policy concerning the seriousness of the prescribed conduct; second, because it permits comparison between the worst possible case and the case that the Court is being asked to address; and third, because the maximum penalty provides a “yardstick” which should be taken and balanced with all the other relevant factors: Markarian at [31] (per Gleeson CJ, Gummow, Hayne and Callinan JJ).

107 Even where the maximum penalty for the contravention is high, and the amount necessary to provide effective deterrence is large, the amount of the penalty should be proportionate to the contravention and should not be so high as to be oppressive: Stihl Chain Saws at 17,896; NW Frozen Foods at 293.

115    The following comments can be made about these paragraphs. First, the comments at [99] reflect what we have said at [38]–[39] above. The Court clearly expressed itself as needing to eschew retributive elements in the object of the imposition of the penalties. Secondly, the utilisation of the notion of the “instinctive synthesis” in [100] can be seen as a (correct) emphasis on the evaluative resolution or conclusion from sometimes conflicting considerations and the (correct) rejection of a mechanical or a mathematical approach in some (impossible) search for precision. Thirdly, whilst a degree of taxonomy can be seen in dealing with available factors at [100]–[104], there was no rigidity of approach that could be seen as limiting or restricting the statutory task of fixing the appropriate penalty for the relevant contravention for the object of deterrence by reference to all considerations relevant to deterrence. Fourthly, by way of comment, there could be added to [104] or [105], depending upon how the factors arose, a consideration of whether the contravention involved or reflected, or other material including past contraventions evidenced, a degree or strength of unwillingness in the contravenor to obey the law. Such would be highly relevant to deterrence. We do not see anything in these paragraphs of the Full Court excluding such a consideration which could be seen to derive from Veen (No 2) at 477–478. Fifthly, we agree with the expression of the matters concerning the role of the maximum penalty in [106]–[107]. We do not see anything in [106] as contrary to viewing the maximum penalty as available for circumstances where the most severe penalty is warranted given the object is to deter contraventions of the kind before the court.

116    In fixing the relevant penalties, the Full Court dealt with the record of contravention of the union. It is appropriate to set out that consideration at some length given the arguments which will be dealt with later. The Court said at 254 FCR 101–103 [158]–[165] the following:

158 As for the position of the CFMEU itself, the Commissioner tendered schedules of prior cases involving the CFMEU that on any view reveal a lamentable, if not disgraceful, record of deliberately flouting industrial laws. At the time of the hearing, the CFMEU and its officials had been involved in 37 separate cases involving breaches of s 38 of the BCII Act, as well as countless other cases involving contraventions of other industrial laws. It is unnecessary and probably undesirable to discuss the specifics of those cases, including the penalties imposed in them, in any detail. The conduct involved in the cases covers a broad range of unlawful industrial action. In most of the cases the contraventions were admitted and the penalties were agreed between the parties. In all the circumstances, it is not possible to discern any meaningful pattern or range in the penalties that have been imposed that would assist in fixing the penalties in this case.

159 The most significant point to emerge from the schedules of past cases is that the CFMEU is a recidivist when it comes to contravening industrial laws. No penalties that have been imposed in the past have appeared to reduce its willingness to breach the law. It continues to thumb its nose at the industrial laws, including the BCII Act. The Court should nevertheless not shy away from imposing stern sentences with a view to attempting to deter the CFMEU from engaging in, or encouraging others to engage in, further unlawful industrial action. Considerations of deterrence, both specific and general, undoubtedly loom large in fixing the appropriate penalties.

160 Equally, the CFMEU’s record of past transgressions means that there is no reason to afford it any particular leniency based on its past behaviour. That is not to say that it should be penalised again for its past contraventions. The CFMEU’s conduct in the past should be given significant weight in determining the appropriate penalties, but it should not lead to penalties that are disproportionate to the nature and circumstances of the relevant contraventions.

161 It should also perhaps be noted that the schedules reveal that the CFMEU officials involved in the contraventions in this matter have been involved in many of the past contraventions by the CFMEU. Nevertheless, for reasons that remain largely unexplained, the Commissioner did not commence proceedings and seek penalties against the officials in this matter. The relief sought was limited to the union itself.

162 It is uncontroversial, and in any event is a matter of common knowledge not reasonably open to question, that the CFMEU is a significant organisation with real power and influence in the building industry. There is, however, no evidence or agreed fact about its financial capacity.

163 About the only thing that could be said in favour of the CFMEU, other than that the conduct was related to genuine concerns about sham contracting, is that it cooperated with the Commissioner in relation to these proceedings by admitting the contraventions and reaching agreement in relation to the facts. Importantly, the admissions and agreed facts were also not withdrawn after the initial agreement in relation to the penalty amounts was withdrawn by the Commissioner. There is no doubt that the CFMEU should receive credit for this cooperation. From a public policy perspective, it is important to encourage such cooperation by reflecting it in the penalties imposed. It also shows willingness on the part of the CFMEU to accept responsibility for its actions and to facilitate the course of justice. The fact that the proceedings were not defended saved the community the expense of a potentially lengthy contested hearing.

164 It is, however, doubtful in all the circumstances that the CFMEU’s cooperation with the regulator could really be said to demonstrate contrition or remorse. In some respects the cooperation reflects nothing more than an acceptance of the inevitable. The CFMEU did not adduce any evidence of contrition or remorse. Indeed, there was not even an expression of contrition or remorse in its submissions. There was no evidence from which it could be inferred that the CFMEU intended to change its ways. There was certainly no suggestion, let alone evidence, to the effect that the CFMEU intended to set up any systems, processes, procedures or education to ensure that its officers did not encourage unlawful industrial action in the future.

165 The principles in relation to taking admissions and cooperation into account are well-known and do not need to be repeated. It is sufficient to note that the authorities make it clear that it is not necessary for the Court to specify a specific discount or percentage discount in respect of cooperation.

(Emphasis added.)

117    With respect, we see no error in any aspect of the principles there expressed in the course of their practical application. We see no intrusion of inappropriate considerations of retribution. The matters expressed in [160] are all consistent with the notion of reasonable proportionality inhering in s 546 for the reasons that we have earlier given.

118    In February 2018, the High Court handed down judgment in the Non-Indemnification Case (HC) (2018) 262 CLR 157. The majority of the Court determined that s 546 contained an implied power to make an order against the person upon whom the penalty was imposed not to seek indemnification or payment from any other person (including the union). The reasons were not concerned with an examination of sentencing principles, apart from reiterating the objective of the imposition of civil penalties being deterrence: 262 CLR at 173 [42] and 195 [116]. The matter was remitted to the Full Court for the setting of fresh penalties.

119    The remitted penalty hearing in this Court was heard on 25 May 2018, with judgment being delivered on 25 June 2018. There was no doubt that past conduct and past contraventions by the union and the union official concerned were at the centre of the consideration of the Court. That is clear both from the primary judge’s reasons in that matter (Mortimer J), and the reasons of the Full Court: Construction, Forestry, Maritime, Mining and Energy Union v Australian Building and Construction Commissioner [2018] FCAFC 97; 264 FCR 155 at 165–166 [12]–[13] (2nd Non-Indemnification Personal Payment Case (FC)). In that context, the Full Court shortly expressed the relevant principles at 264 FCR 167–168 [19]–[22] and 168–169 [25]–[27] as follows:

19 It is unnecessary to engage in any extended discussion of principle. Of particular significance is the recognition that deterrence (general and specific) is the principal and indeed only object of the imposition of a penalty — to put a price on contravention that is sufficiently high to deter repetition by the contravener and others who might be tempted to contravene the Act: French J in Trade Practices Commission v CSR Ltd [1990] FCA 762; [1991] ATPR 41-076 at 52,152, cited by the plurality in Commonwealth v Director of the Fair Work Building Industry Inspectorate (Civil Penalties Case) [2015] HCA 46; (2015) 258 CLR 482 at [55]. Retribution, denunciation and rehabilitation have no part to play.

20 Relevant factors in the overall assessment of penalty were helpfully listed by French J in CSR. They have been adopted in many cases. For present purposes, they can be restated as follows: the nature, character and seriousness of the conduct; the loss and damage caused; the circumstances in which the conduct took place; the size of the contravener and its degree of power; the deliberateness of the conduct and the time over which it occurred; the degree of involvement of senior officials or management; the culture of the organisation as to compliance or contravention; and, any co-operation with the regulator and contrition.

21 The seriousness of the contravention and other features of the conduct which may be seen as relevant to it (here, the seriousness of interruption of a concrete pour, the seriousness of the threats of repetition, the deliberateness of the contravening of the Act, and the exhibited apparent sense of impunity in undertaking contravening conduct) find their place in understanding the degree of deterrence that is necessary to be reflected in the size of the penalty: Flight Centre Ltd v Australian Competition and Consumer Commission (No 2) [2018] FCAFC 53; (2018) 260 FCR 68 at [71].

22 The overwhelming importance of deterrence as the protective purpose of the penalty does not exclude the need to determine a penalty which is proportionate to the contravening conduct. The history of contravention is to be taken into account in fixing the proper level of penalty for the proportionate response to the contravention in question. Proportionality has within it the need to characterise the seriousness of the contravention. Proportionality of penal response to a contravention assessed by reference to its seriousness and gravity is an essential characteristic of the application of the statute. The penal response is for that contravention, not earlier contraventions: Veen v The Queen (No 2) [1988] HCA 14; (1988) 164 CLR 465 at 477-478. Prior contraventions may reveal an apparent disregard for the Act and the need for deterrence by a penalty at a level appropriate to achieve that objective. It is to be borne in mind, however, that it is for the conduct in question that the penalty is imposed, not for prior conduct.

…

25 The maximum penalty under the Act for each contravention is $51,000 for the Union and $10,200 for Mr Myles: see Item 11 of the table in s 539(2) and s 348 of the Act, and s 4AA of the Crimes Act 1914 (Cth), by reference to the date of the contravening conduct.

26 It is necessary to have regard to the maximum penalty. In Australian Competition and Consumer Commission v Reckitt Benckiser (Australia) Pty Ltd [2016] FCAFC 181; (2016) 340 ALR 25 at [154]-[156], the Full Court said:

[See these paragraphs set out at [101] above].

27 These considerations, especially those in [156], will be affected by the level of deterrence recognised as necessary, in part from any history of contravening conduct.

120    The Court also, in dealing with the notion of course of conduct, emphasised the role of that principle in the prevention of penalising a party more than once for the same conduct. In that respect, regard was had, at 264 FCR 170 [31], to a series of Full Court cases rejecting double punishment, that is, rejecting the proposition that a party could have imposed on him, her or it a penalty for the same contravention more than once: Construction, Forestry, Mining and Energy Union v Cahill [2010] FCAFC 39; 194 IR 461 at [41]; Australian Competition and Consumer Commission v Hillside (Australia New Media) Pty Ltd (No 2) [2016] FCA 698 at [24]–[25] approved by the Full Court in Reckitt Benckiser at [141] and Australian Competition and Consumer Commission v Cement Australia Pty Ltd [2017] FCAFC 159; 258 FCR 312 at 448 [425]–[426]; and Australian Competition and Consumer Commission v Yazaki Corporation [2018] FCAFC 73; 262 FCR 243 at 295 [231]–[232].

121    On 14 August 2018, the Full Court delivered judgment in Broadway on Ann 265 FCR 208. This decision was at the centre of the primary judge’s reasoning. The primary judge saw in the reasoning of the majority (Tracey J and Logan J) a correct understanding of the proper principles concerning the imposition of penalties, in contradistinction to what he considered the flawed expression of principle by the dissenting member of the bench, Bromwich J, in particular in what the primary judge perceived to be a failure by Bromwich J to apply Veen (No 2) correctly.

122    The leading judgment in Broadway on Ann was delivered by Logan J. It is helpful, however, to frame the analysis of the reasons of Logan J by referring first to the “observations” of Tracey J. Before doing so, it is instructive to understand the facts of the case and how the primary judge had dealt with them. The case involved the right of entry to a construction site and the improper behaviour of a very senior union official of the CFMEU, contrary to s 500 of the Fair Work Act. The reasons of Logan J at 265 FCR 217–218 [33]–[37] reveal, in narrative form, the relevant facts in the human context of what occurred on the day in question, with clarity and restrained expressive illumination. The principal actor, Mr Hanna, was a very senior union official, known to be such by the representatives of the employer and by the workers on the site.

33 Shortly after Mr Hanna entered the premises, his presence was noted by Mr John Liddington, Hindmarsh’s project manager and by Mr Garry Gough, who was its site manager for the building project. They told him that he was on site illegally and that he must return to the site office immediately. Mr Hanna ignored this. He remained on the premises. He descended down some stairs to the basement level of the project. There he encountered Mr David Liebke, who was Hindmarsh’s site supervisor. Mr Liebke asked Mr Hanna what he was doing on site. Mr Hanna replied: “I’m having a meeting with my workers.” Mr Liebke asked Mr Hanna if he had a right of entry permit. At this point Mr Hanna raised his hand to Mr Liebke with his middle finger extended and said that he did not need an entry permit. Mr Liebke then asked Mr Hanna to leave the premises. Notwithstanding this, Mr Hanna remained on the premises at the basement level. He walked away from Mr Liebke and called some of the employees present from the four different subcontractors mentioned towards him. He told them that they were going to have a meeting.

34 Shortly thereafter and while Mr Hanna was still on the basement level, Mr Gough approached him. Mr Gough said to him: “You are trespassing. Why don’t we go upstairs and talk about it?” Mr Hanna replied to the effect that he had come to meet with his members. Mr Gough then said: “What are you doing here? You are here illegally. Why don’t you go through the right channels?” Mr Hanna replied: “I can do what I like.” Mr Thomas Neylon, who was Hindmarsh’s contracts manager for the project, then approached Mr Hanna with Mr Liddington. Mr Liddington again said to Mr Hanna that he was to leave the site as he did not have permission to be there and that no entry permit had been sent to Hindmarsh. Mr Hanna’s response was to the effect that he did not need to get permission to enter a building site to talk to the men with whom he had an enterprise bargaining agreement.

35 During this discussion between Mr Liddington and Mr Hanna, Mr Neylon activated the video recorder function on his mobile phone. Mr Hanna, seeing this, then moved towards Mr Neylon. Mr Hanna, who had in his hand a plastic water bottle, squirted water from the plastic water bottle at Mr Neylon. This hit Mr Neylon in the face, wet his shirt and went over his mobile phone. Mr Hanna then moved to Mr Neylon and said: “Take that phone away or I’ll fucking bury it down your throat. You ask me if you want to take a picture of me. You ask me.”

36 Mr Hanna then spoke to some of the employees who were there in the basement level of the project. This conversation was not heard by any of the persons in authority for Hindmarsh. At about 12 noon, Mr Hanna and a number of the employees left the basement level of the project and made their way out of the premises. Mr Hanna used the swipe card of one of those employees to swipe out a number of the employees through the turnstiles at the exit of the premises. That had the effect of a number of employees leaving under the one swipe card. This meant that Hindmarsh did not have a record of which employees had left the premises and which employees had not. The employees were all similarly dressed. There is no evidence that any employee in a position of authority for Hindmarsh was in any way then able to check who it was had left the site and where they were. Of this the learned primary judge, permissibly and understandably, observed at [17] “The safety aspects of such an action should be quite obvious.”

37 The employees who left in this manner with Mr Hanna were away for about 30 minutes. The employees then returned to the premises and recommenced work.

123    From this the evident seriousness of the episode of conduct can be appreciated.

124    Out of this episode, six contraventions of s 500 of the Fair Work Act of exercising or seeking to exercise a right of entry in an improper manner were extracted and found by the primary judge (for each of which the union had imposed on it the maximum penalty by the primary judge). They were described by Logan J at [41] as follows:

(a)     entering the Project without having given a notice of entry under s 487 of the FWA;

(b)     remaining on the premises despite requests to leave;

(c)     when asked if he had a right of entry permit, responded by raising his hand with his middle finger extended and saying that he did not need one;

(d)     squirted water at a person validly engaged to work on the Project, which struck the person’s face, shirt and mobile phone;

(e)     stating “Take that phone away or I’ll fucking bury it down your throat, you ask me if you want to take a picture of me, you ask me”; and

(f)     using an employee’s swipe card to swipe out a number of employees engaged on the Project, the effect of which was that the occupier of the premises did not have a record of which employees had left the premises and which had not.

125    This disaggregation of the conduct into somewhat more abstracted and less humanly expressive terms, tended, at least in language, to drain the whole conduct of some of its seriousness. This is so because the disaggregation (necessary for the precise identification of the contraventions) tended to separate the events from their interconnected whole human context.

126    Section 500 is not included in what can be called the statutory course of conduct provision of s 557. From this, the primary judge (wrongly) concluded that he was bound to deal with each contravention without regard to considerations of a single course of conduct as part of ordinary sentencing principles. Thus, the Full Court, on any view, was required to engage in the process of resentencing.

127    The appeal, as argued, raised four grounds, which were set out by Logan J at [44]:

(a)     an alleged error in concluding that course of conduct considerations were not applicable to the imposition of penalty in the circumstances;

(b)     an alleged error in the description of Mr Hanna as the public face of the CFMEU;

(c)     an alleged error in the characterising of the contraventions as in the worst possible category; and

(d)     whether the penalty imposed was, both individually and in total, was [sic] manifestly excessive.

128    In the result, and for the reasons to which we will come, even having regard to the considerations of the course of conduct of the events, Logan J concluded (with which conclusion Tracey J agreed) at 265 FCR 230 [87]:

… So recalcitrant is the contravening conduct charged having regard to the past history in the tabulation and such is the importance of deterrence and compelling conformity with the requirements of the FWA my view is that only the most condign penalisation of a cumulative maximum punishment is warranted in the circumstances of this case. I would impose that so as to bring home emphatically to the CFMEU that, in its internal governance, it must force systemic behavioural change upon its Construction Division. …

129    Tracey J, after referring to the history of the uncertainty of the character of the penalty under earlier legislation, the settling of that controversy in Gapes v Commercial Bank of Australia Ltd [1979] FCA 62; 38 FLR 431, the development of the civil remedy provisions in replacement of criminal provisions in more modern legislation, and the settled guidance, nevertheless, in many cases in the Court of sentencing principles from crime adapted to the imposition of civil penalties (in particular proportionality, consistency, avoidance of double punishment, deterrence and totality), referred to the “modifications and differences in emphasis in the way in which the principles are framed” following the Agreed Penalties Case (HC): see 265 FCR at 212 [9]. In that context, and immediately after referring to the Agreed Penalties Case (HC) 258 CLR at 506 [55] and 523–524 [110], Tracey J set out at [13], without disapproval, what had been recently said by the Full Court in the 2nd Non-Indemnification Personal Payment Case (FC) 264 FCR at 167–168 [20]–[22] (as to which see [115] above). At [14], Tracey J referred to the distinction between:

… the need to ensure that a contravenor is not doubly penalised for past and present misconduct and the consideration of historic misconduct for the purpose of assessing the need for specific deterrence of a recidivist organisation. …

The distinction to which his Honour was referring was supported by Veen (No 2) at 477–478, subject to the recognition of the importance of the place of the maximum penalty referred to in Veen (No 2) at 478.

130    After referring to decisions of the Court emphasising the need for industrial laws to be obeyed: Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union (No 2) [2015] FCA 1462 at [8] (Jessup J), Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union [2017] FCAFC 53; 249 FCR 458 at [100]–[101] (Dowsett and Rares JJ) and the Queensland Infrastructure Case 254 FCR at 88 [98], Tracey J said at [16]:

These principles are to be observed in the fixing of any civil penalties under the FW Act. All relevant considerations must be taken into account with a view to determining an appropriate penalty.

131    It is clear that in this statement of principle, to this point, his Honour was guided by Veen (No 2), that his Honour recognised that the imposition of a penalty for the past was impermissible as a form of double punishment, and that the imposition of the penalty was for the instant contravention before the court.

132    From [17]–[22] of his reasons, Tracey J gave pointed and powerful expression to deep concerns about the conduct of the CFMEU over “recent years”, saying:

17 Over recent years I have become increasingly concerned about the ongoing misconduct of the CFMEU and its officials and the implications of this conduct when penalties are being determined. These misgivings have been expressed in a series of judgments.

18 In Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union (No 2) (2015) 234 FCR 451, I made the following comments:

106     The circumstances of these cases were not identical to those in the present case. They, nonetheless, bespeak a deplorable attitude, on the part of the CFMEU, to its legal obligations and the statutory processes which govern relations between unions and employers in this country. This ongoing willingness to engage in contravening conduct must weigh heavily when the need for both specific and general deterrence is brought to account.

107     The CFMEU is not to be punished again for its earlier misconduct. It is, however, to be punished more severely than it would have been had it had no adverse record or been responsible for only a few isolated incidents over a period of many years. Its continued willingness to engage in contravening conduct supports the view that earlier penalties, some of them severe, have not had a deterrent effect: cf Veen v R (No 2) (1988) 164 CLR 465 at 477-8.