FEDERAL COURT OF AUSTRALIA
IN THE FEDERAL COURT OF AUSTRALIA
DATE OF ORDER:
THE COURT ORDERS THAT:
2. The parties be at liberty within 21 days to file and serve such written submissions and proposed directions as they may be advised as to the further hearing of this matter.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
SOUTH AUSTRALIA DISTRICT REGISTRY
SAD 328 of 2011
AUSTRALIAN COMPETITION AND CONSUMER COMMISSION
EXCITE MOBILE PTY LTD (ACN 128 229 498)
18 APRIL 2013
REASONS FOR JUDGMENT
1 This action concerns the marketing sale and supply of mobile telephony services.
2 The Australian Competition and Consumer Commission (ACCC) alleges that in relation to the conduct of the supplier, the first respondent Excite Mobile Pty Ltd (Excite Mobile):
(a) the sales method was unconscionable, contrary to s 51AB of the Trade Practices Act 1974 (Cth) (the TPA);
(b) Excite Mobile misrepresented to a significant number of customers the extent of coverage available to those customers, contrary to ss 52 and 53(c) of the TPA;
(c) Excite Mobile misrepresented that its internal complaints handling section was an independent complaints handling organisation available to consumers of telecommunications services, contrary to ss 52 and 53(g) of the TPA; and
(d) Excite Mobile made misrepresentations, in a variety of ways, about its debt collection entity and its debt collection processes and their consequences which:
(i) were also contrary to ss 52 and 53(g) of the TPA;
(ii) amounted to undue coercion, contrary to ss 60 of the TPA; and
(iii) amounted to unconscionable conduct, contrary to s 51AB of the TPA.
3 The ACCC also alleges that the second and third respondents, Mr Brown and Mr Samuel, who were directors of Excite Mobile, were directly knowingly concerned in those contraventions, and that one of Excite Mobile’s employees or agents, the fourth respondent Ms Smart, was knowingly concerned in those contraventions insofar as they concerned the debt collection practices of the supplier.
4 The acts and omissions that the ACCC claims give rise to the alleged contraventions occurred prior to 1 January 2011, and so the TPA as in force immediately before 1 January 2011 continues to apply to the alleged acts and omissions: Trade Practices Amendment (Australian Consumer Law) Act (No 2) 2010 (Cth), Sch 7, item 6. In that circumstance, it is convenient also to use the term “the TPA”, even though from that date the TPA became the Competition and Consumer Act 2010 (Cth) by Sch 5, item 2 of the same amending Act.
5 For the reasons which appear below, I have found each of those contraventions against Excite Mobile and on the part of Mr Brown, Mr Samuel and Ms Smart proved. It is agreed between the parties that the decision as to what, if any, orders should be made as a result of those findings should be addressed at a separate and later stage of the proceedings. Accordingly, I now invite each of the parties, within 21 days, to propose how and when the further hearing contemplated should be conducted, unless they are able to agree about that. The matter will also be adjourned for further directions on a date convenient to the parties.
Overview of Excite Mobile, Lime India and Lime Australia
6 Excite Mobile is a company that supplies mobile telecommunications services and related equipment. From at least 24 December 2008 to 4 November 2010 Excite Mobile promoted its services through telephone marketing (telemarketing) calls by representatives of Lime India Private Limited (Lime India) and other call centres in India, Pakistan and the Philippines.
7 Excite Mobile has made no appearance to date. The Australian Securities and Investment Commission (ASIC) is in the process of deregistering Excite Mobile, but has deferred the process following a request from the ACCC pending the outcome of this proceeding.
8 Lime Australia Pty Ltd (Lime Australia) is a registered company in Australia. Prior to the establishment of Excite Mobile, Lime Australia conducted its primary business as a mobile phone plan dealer. This involved soliciting customers to an independent carrier, in exchange for a commission. On the establishment of Excite Mobile, Lime Australia became responsible for Excite Mobile’s accounting and for the contracting of Lime India.
9 Lime India is a company based in India. Lime India provided services to Excite Mobile including making telemarketing calls to potential customers, attending to the customer service issues of Excite Mobile’s customers, attempting to collect unpaid accounts purportedly owed to Excite Mobile by customers, and entering information in relation to dealings with Excite Mobile’s customers into an electronic database, for and on behalf of Excite Mobile.
10 Excite Mobile provided Lime India with the scripts to be used in the telemarketing calls and directed the telemarketers to follow the scripts.
Roles of Mr Brown, Mr Samuel and Ms Smart
11 Mr Brown and Mr Samuel were the founders and directors of Excite Mobile and were also its sole shareholders at all material times. Mr Brown was a director and secretary, and Mr Samuel was the other director. They were also the directors of Lime Australia – Mr Brown from 27 June 2002 and Mr Samuel from 10 October 2003. They, together with Mr Sundeep Grover, were also the directors of Lime India.
12 Ms Smart became involved in Excite Mobile through Mr Brown, with whom she is in a relationship.
Nature of package offered
13 Excite Mobile contracted with customers to provide mobile telecommunication services through the Optus network. Potential customers were contacted by telemarketers who offered the customer an enticement to contract, namely the “gift” of a phone and holiday vouchers. The contracts offered were on a 24 month plan. The plans consisted of a minimum monthly fee, for which customers would receive a set daily allowance for calls and text messages, depending upon the size of their contract. The most commonly selected contract was the $33 per month plan, for which customers received a daily allowance for calls and text messages capped at $2.20. Any costs incurred outside of the cap would be added to the monthly bill.
The telemarketing calls
14 The telemarketing calls were to progress in a three-part sequence. A script was provided to the telemarketers and the telemarketers were instructed by Excite Mobile to follow it.
15 During the first stage, an unsolicited telephone call was to be made to potential customers on their personal phone numbers. After a generic greeting, the script starts:
Well! Guess what, you have been selected to receive a mobile phone absolutely at $0 upfront costs from Excite Mobiles which would be working on the most trusted mobile network in Australia and that’s none other than OPTUS with no Application, Activation, or Delivery Fee. You would be receiving NEW Best Seller “ZTE – T6 Mobile [sic] which has 2 mega pixel camera, FM Radio, MP3 Player and ring tones, Expandable memory card to support up to 4GB, Bluetooth 1.2 with stereo headset support, Speakerphone and many more great features.
It does not stop here, because you would really be glad to know, that as a warm gesture for all our customers who sign up with us today, they would also be receiving holiday vouchers, which entitles 2 people, for a free accommodation for 7 days in any of the 200 hotels, over a period of one year. So if you observe with Excite Mobiles, you not only pay a low monthly access fee of only $22 but also in return if you break it down further every day you would be getting up to $2.20c worth of calls to be used completely which means UPTO $66 every single month,.. Isn’t that neat!!!
(emphasis in original)
16 The ACCC provided 10 examples of telemarketing calls and / or mobile contracts that were selected as follows. The first and last customers of Excite Mobile were chosen. The remaining eight customers were selected by choosing the last customer of every second month in which there was a recording available.
17 The scripted explanation of the cap set out above was not included in any of the 10 examples referred to. Instead the telemarketers simply said words to the effect of “[f]or only $33 you get $66 worth of calls.”
18 During the second stage of the telemarketing call, the telemarketers obtained personal information from the customers, including the customer’s address, full name, bank account number / credit card details and identification details such as a licence number.
19 During the third stage of the telemarketing call, the telemarketer sought the customer’s consent to enter into an oral contract with Excite Mobile for the provision of mobile telecommunications services. The telemarketer asked whether the customer had Optus coverage in his or her area. It is at this stage that the terms of the contract are read to the customer, and the customer is asked to consent to those terms.
20 In each example provided by the ACCC, it was only during this third stage that the daily cap or day cap was mentioned. The activation call for customer 101421 is typical in this respect, where the day cap was not mentioned in the first stage of the call. In the third stage, the telemarketer stated:
And do you agree that you are applying to connect to Excite Mobile on the day cap $33 package using the Optus network on a 24 month contract that has a minimum monthly charge of $33 which includes a daily call cap up to a maximum of $2.20 worth of national calls, mobile calls, MMS and SMS only. This excludes services such as Premium SMS, OptusZoo, voicemail, special calls and international roaming charges. Your daily included calls expire each day. Any unused call for the day expire, right.
21 No other explanation of the day cap was given. If the customer agreed, the telemarketer continued to explain call charges and the delivery of the phone. The voice contract continues, with the telemarketer stating that the phone would be activated within 13 days unless the customer advised to the contrary, and if the contract was to be cancelled after this period a cancellation fee would be applied.
22 The telemarketer then proceeded to advise that the phone is insured for the first two months free of charge, that the normal charge for insurance is $8.95 per month and that that insurance can be cancelled by giving 30 days notice. The telemarketer also explained that in the event a claim was made on that insurance, a $100 excess is charged. The evidence showed that the cost of a phone to Excite Mobile was only $100 or so, so the “insurance” was of no real value. However, no allegations were made by the ACCC about that aspect.
23 The telemarketer then advised the customer that if the customer wanted to cancel their contract within 10 days, the customer was required to pay a $75 “cooling off fee” to “cover [their] postage, insurance and [their] other handling charges.” If the phone is damaged, including the packaging, the customer is required to purchase the phone outright at a cost of $195.
24 The last term the telemarketer explained was the direct debit authority, whereby the telemarketer obtained the consent of the customer to automatically directly debit from the customer’s account unbilled call charges, where those charges had reached over $50, on 24 hours notice.
25 The “day cap” was an important part of the deal offered by Excite Mobile. For a monthly access fee of $33 the customer would receive $2.20 worth of national calls, mobile calls, MMS and SMS per day (the day cap). For $44 per month, the day cap was increased to $4.40, and for $55 the day cap was increased to $11 per day. If unused, the day cap expired at the end of each day. The evidence largely centred on the $33 per month option.
26 The script mentions phone coverage in the third stage of the call. The script requires the telemarketer to ask “Are you aware of the Optus coverage in your area?” The scripted follow-up is:
Regardless of what you have been told previously. Do you understand we ONLY guarantee coverage at HOME you may get coverage elsewhere however we do NOT guarantee coverage in any other areas?
27 The ACCC gave evidence that in at least 17 cases where the above representation was made, coverage was not available at all.
28 In one example, the customer advised the telemarketer that they did not get Optus coverage and that they were located 600 kilometres northwest of Katherine. The telemarketer then asks “Well, who is Wendy and who is Tommy, because we sold them mobile phones so you should get one as well.” The telemarketer then continues reading the script, with the statement “regardless of what you have been told previously, do you understand we only guarantee your coverage at home.” In other words, the telemarketer did not respond appropriately to the customer despite the customer saying there was no Optus coverage.
29 In another example (customer 1043453), the customer asked “does this phone work out bush?” The telemarketer answered “First we will do a network check, then we will send you the mobile phone, alright?” After confirming that the customer agreed, the telemarketer proceeded with the script. Excite Mobile’s electronic database, Onlime Compliance (OLC) records the address provided by the customer as having “partial coverage”. Mr Brown submitted that this was based upon a file received from SIMplus that matched postcodes with an explanation of coverage, which had come from Optus. That file was not provided in evidence. The evidence of Neil Robinson, a Manager for Radio Frequency Planning for Mobile Networks at Optus, is that “Optus has never had service or planned coverage at this location.” Again, the telemarketer on behalf of Excite Mobile was simply pressing to do a deal, even though the availability of coverage was raised by the potential customer; the customer’s concerns were not really addressed.
30 In another example (customer 108692), the telemarketer confirmed that they did not guarantee coverage in bush, rural or country areas and that coverage was limited to where Optus has coverage. The customer started to say something, and the telemarketer spoke over the top of that customer, and continued with the voice contract terms. Again, there is the firm appearance of form over substance: it did not matter what the customer’s expressed concerns were about coverage, the telemarketer simply pressed on.
The Welcome Package
31 After entering into a mobile contract with Excite Mobile, customers were sent a mobile telephone and SIM card, a letter entitled “Welcome to Excite Mobile”, a document entitled “Applicable Fees and Charges” a document entitled “Escalations and Complaint Policy” and a document entitled “Knowing Your Limits”.
32 The parties agree that the Welcome Pack did not form part of the contract, as the contract was an oral contract made over the phone at an earlier point in time.
33 Between 21 September 2009 to around 18 June 2010, representatives of Lime India on behalf of Excite Mobile advised at least six customers that if they wished to escalate the concerns they had raised, they had to contact a separate escalations number, which was referred to as “Telecommunications Industry Complaints” (TIC). At least 21 customers were also advised of this number in the course of their initial activation calls. This number was also included as the ‘escalation number’ in the Welcome Pack introductory letter.
34 The TIC telephone number was in fact owned by Excite Mobile and was answered by representatives of Lime India, using words to the effect “Telecommunications Industry Complaints”. The representatives did not say that they were affiliated with Excite Mobile. On at least 16 occasions the representatives did one or more of the following:
(a) asked customers to confirm the name of the company they were calling about;
(b) asked customers to describe the matter they were calling about;
(c) stated to customers that they did not have any information on, or access to, customers’ Excite Mobile accounts;
(d) stated that the TIC number does not connect to Excite Mobile’s complaint department;
(e) stated that the TIC takes complaints in relation to many telecommunication companies;
(f) provided customers with a complaint reference number;
(g) stated that TIC is not part of Excite Mobile; and
(h) provided advice to customers on their rights and remedies in relation to the mobile telecommunications service contract entered into with Excite Mobile.
35 Most of what was said was not true, either explicitly or by implication. The form of response was to conceal that the customers complaining were in fact still dealing with Excite Mobile. Only subheadings (f) and (h) might not fall into that category.
36 During a call to customer 112041 in regards to the customer’s queries about her account, the customer was provided by the telemarketer with the TIC number. The customer asked whether that was Excite Mobile’s internal complaints department, to which the telemarketer answered, “No, that’s the Telecommunication Industry Complaints Department.” During a complaint call from customer 105581, the telemarketer provided the TIC telephone number to the customer, saying “see, if you want to complain to the Fair Trading, you can call them.”
37 Excite Mobile attempted to have the name “Telecommunications Industry Complaints” registered as a business name, but was unsuccessful. Instead, the business name approved was Telecom Customer Complaints.
38 In early 2010 Excite Mobile began implementing a policy of debt collection by sending letters to customers with outstanding accounts. Each letter represented that the letter was from an independent debt collector Jerry Hastings (or a representative of him), and that the debt owed to Excite Mobile had been referred to Jerry Hastings for collection.
39 Six types of letters were devised and sent, namely:
1. “Times are Bad” letter, sent to 498 different customers on 516 occasions;
2. “Last Warning” letter, sent to 414 customers on 422 occasions;
3. “Instalment” letter, sent to 80 customers on 83 occasions;
4. “Final Payment” letter, sent to 9 customers;
5. “Failure to pay” letter, sent to 34 customers on 35 occasions; and
6. “Thank you” letter, sent to 38 customers on 39 occasions.
(Together, the Jerry Hastings letters.)
40 The respondents say Jerry Hastings is the Anglo-Saxon name adopted by Mr Mayank Punia, a manager of Lime India. The photograph included in the letter is not of Mr Punia.
41 In fact, all the debt recovery communications were made by Excite Mobile or on its behalf.
42 The Times are Bad letters were signed by hand and sent by registered post by Ms Smart and Mr Brown. The letter said that unless the customer telephoned the Jerry Hastings number and an agreement was entered into to pay the alleged debt, Jerry Hastings would go to Court to recover the debt allegedly owed to Excite Mobile by the customer, and if he did, the Court could make orders requiring the customer to pay an additional charge equal to 20% of the customer’s alleged debt for failing to pay on time and requiring the repossession of all assets of value of the customer, including children’s toys.
43 The letters also said that the lawyer used by Jerry Hastings is uncaring and unsympathetic towards customers like the addressee, is highly skilled and persuasive and would be entitled to recover her fees and charges from the customer in addition to the alleged debt and additional charge mentioned. The language employed is strong and threatening. For example, the Times are Bad letters include the following statement:
Believe me there is no way you want to meet my lawyer in court. While she seems like a nice lady she is a killer in front of the judge. One case she even got the judge to order a young mother have her kids game machine repossessed. She has no feelings towards you at all. Her job is to be as mean as possible towards you. She can make your life extremely uncomfortable.
44 It is not disputed that the lawyer referred to is a fictional construct.
45 The Last Warning letters were sent to customers who had previously been sent the Times are Bad letter. They again suggest that the letter is from Jerry Hastings, and stated that Jerry Hastings intended to institute proceedings against the addressee unless the addressee called the Jerry Hastings number and entered into a payment plan.
46 The Failure to Pay letters were sent to customers who had entered into a payment plan but then failed to meet that payment plan. These letters were signed using an electronic signature and sent by Ms Smart. They contained a representation that, unless the customer paid the agreed amount, Jerry Hastings would go to Court to recover the debt allegedly owed to Excite Mobile by the customer, and if he did, the Court would make orders requiring the customer to pay an additional charge equal to 20% of the customer’s alleged debt for failing to pay on time.
47 Between 11 January 2010 and 23 June 2010, after receiving a Jerry Hasting letter, a number of Excite Mobile customers telephoned the Jerry Hastings number. This was answered by a computer that took a message. These calls were responded to with a return call, usually by Ms Smart and on occasions by Mr Brown. In these phone calls (the Jerry Hastings telephone calls), Ms Smart and Mr Brown represented to customers that they were from Jerry Hastings’ office, that Jerry Hastings’ office was a debt collector acting for Excite Mobile and that it was independent of Excite Mobile. Customers were encouraged to enter into a payment plan, and to use Centrepay facilities, for those customers receiving Centrelink payments.
48 The ACCC submitted evidence of 136 recordings with 98 different customers involving Ms Smart, and of three recordings involving Mr Brown.
49 By making the representations in the Jerry Hastings telephone calls, Excite Mobile obtained agreement with at least 80 customers to pay an amount by instalments, and with nine customers to pay a lump sum amount.
THE CLAIMS AND RESPONSES
Liability of Excite
50 The ACCC submitted that the sales method employed by Excite Mobile was unconscionable. It submits that the day cap, the cooling off fee, and the direct debit authority are unusual, unfair and onerous contract terms, and that those terms were not explained adequately. Nor was it explained to customers that they would be likely to have to pay charges over and above the monthly access fee. The ACCC submitted that the day cap was designed so that customers would exceed their day cap and be required to pay in excess of the minimum monthly access fee. For example, a customer on the $33 per month plan who, on one day, had two conversations of less than 30 seconds and sent one text message would exceed the cap for phone usage for that day.
51 The ACCC submitted that the focus of the telemarketing call instead was upon the items which were purportedly to be provided to the customer at no charge and, further, that the terms of the contract were conveyed in a way that was difficult to understand, with the telemarketers speaking quickly and often in heavily accented English.
52 During the course of the hearing the ACCC played the activation call of customer 116583 at the point of the voice contract. The speed of delivery was so fast that the content of the voice contract was in parts incomprehensible. In addition, the telemarketer did not always receive a reply when asking for confirmation of a term, but proceeded after a pause, saying “thank you” as though confirmation had been given when in fact nothing was said, or where the customer made noises that suggested she was about to speak. The ACCC accepted in the course of its submissions that there was no basis to suggest that the directors of Excite Mobile directed the call centres to read the script out quickly, or with a heavy accent, or to depart from the script, or to simply ignore consumer responses, or to inaccurately record consumer responses. Nevertheless, that is what happened on this, and I suspect other, occasions having regard to what was presented as the random sample. That matter is further commented on in the postscript to these reasons.
53 The ACCC also submitted that the sales method failed to provide the customers with an opportunity to review the terms of the contract, and to consider whether that mobile service suited their needs. The ACCC said that Excite Mobile intended to and did enforce the contract terms.
54 The effect of the direct debit authority meant that if the accounts remained outstanding, these would be automatically withdrawn from the customer’s account. This was an automated service, connected to the online billing database.
55 The combined effect of the contract, the ACCC said, is that a customer who failed to understand the effects of the day cap from the third stage of the activation call would be liable to pay a $75 cooling off fee, if that customer were to change his or her mind on the receipt of the Welcome Pack, and would also be likely to be required to pay an additional $195 if that customer damaged the box in which the mobile phone was packaged. Almost inevitably, the box containing the phone would be opened. “Damage” in that sense was inevitable. The evidence of Mr Brown that that damage claim was rarely enforced was unconvincing. Neither of these fees, the ACCC said, are commensurate with the losses incurred by Excite Mobile. The ACCC said that the imposition of the obligation to pay is unconscionable whether or not Excite Mobile actually sought the payment of that cooling off fee or not, and that the cooling off fee acted as a disincentive for a customer to cancel a contract even though it had not been obtained with the informed consent of the customer.
56 Further, a customer who did not exercise the cooling off rights would have little or no opportunity to opt out of the contract at a later point. The customer would be required to pay the minimum monthly fee for the remainder of the 24 months, as well as a $99 disconnection fee. The disconnection fee of $99 was not mentioned in the voice contract but it was charged on occasions. If the customer paid the account late, the customer would also incur a $15 late fee. That fee is also not mentioned in the activation contract but is mentioned in the Welcome Pack. On the third page of the introduction letter, in small font, under the heading “Fee’s [sic] and charges”, reference is made to a late fee of $15 that will be charged for any account not paid in full by the due date. That is the first reference to that fee.
57 Mr Brown accepted that Excite Mobile’s seeking payment of a cooling off fee was unconscionable. However, Mr Brown denied that the sales method employed by Excite Mobile as a whole was unconscionable. In particular, Mr Brown denied that the information was conveyed in a manner difficult to understand, and that the telemarketing calls focused on the items purported to be provided free of charge. Mr Brown stated that the day cap was explained in the voice contract, and was further explained in the Welcome Pack documents. Further, Mr Brown submitted that other telecommunication providers charged a day cap, and that the ‘cooling off’ fee of $75 represented the estimated cost incurred in entering into the contract with the customer, postage and handling and retrieval of the mobile phone and SIM card. Mr Brown submitted that other telecommunication providers used direct debit authorities for unbilled call usage, that the terms and conditions were available online and were adequately explained during the voice contract. Further, he said, not all contracts were enforced and not all customers in default received the Jerry Hastings letters.
58 Mr Brown gave evidence that the day cap would be best suited to infrequent phone users who primarily received incoming calls. He stated that many of the customers referred to by the ACCC would have exceeded the day cap, even if the cap was a monthly cap rather than a daily cap, and so he said the day cap was not the reason for their large bills.
59 Mr Brown gave conflicting evidence about the existence of like plans, stating in his affidavit that OneTel also had a day cap. In cross-examination he stated that he was not sure whether that was operating at the time that Excite Mobile was offering its day cap plan. He also conceded in cross-examination that the day cap product was unique, and that in 2009/2010 Excite Mobile was the only company offering a day cap plan.
60 Mr Brown also submitted that, upon becoming aware that some customers may not fully appreciate the terms and conditions of the day cap, the marketing script had been modified to explain in more detail the day cap plan, inclusions, exclusions, terms and conditions and excluded call charges. An undated version of the script was provided in evidence. After describing the value of the day cap, it continued:
For example on the Day Cap $33 plan if you make $3.00 worth of eligible calls in a day. $2.20 will be included in your cap and the extra 80 centes [sic] will be on top of your monthly access fee. Same applies if you spend less then [sic] $2.20 per day worth of calls whatever is not used does not roll over to the next day.
61 This modified script also gave a different description of the holiday offer. No party referred the Court to an example of a marketing call where a customer had entered into a contract, based upon the modified script. The four recordings transcribed and played in Court were dated between 28 February 2009 and 16 August 2010. None of these utilised the updated script. I infer from the fact that no example of a call was provided using the updated script that it was not used before 16 August 2010, and rarely if at all after that date.
62 Mr Samuel admitted that the sales method employed by Excite Mobile was unconscionable but contested some of the factual bases to the ACCC’s submissions.
63 Mr Samuel submitted that it was neither the intention of, nor at the direction of, Excite Mobile that information be conveyed by persons speaking quickly in accented English. He said that overseas call centres were engaged as a commercial decision, given the cost of Australian call centres.
64 Mr Samuel also denied that the customers were not given an opportunity to review the terms and conditions, saying that the customers had the opportunity to cool off when the package was received by not connecting or activating the phone and the opportunity to refer to the Welcome Pack documents.
65 Mr Samuel admitted that the $75 was “unacceptable” but that he believed that it was not charged to customers in every instance, and further, that the fee was not a profit for Excite Mobile but that it was to offset the costs incurred by Excite Mobile in posting out the Welcome Pack and processing its return.
66 Mr Samuel also suggested that if the phone had been opened, and the cellophane removed, the customer would not be liable to pay the $195 fee. There is no foundation for that suggestion, and I do not accept it.
67 The ACCC submitted that the representations made to 17 customers that they would have coverage was false, and that Excite Mobile has accordingly engaged in conduct which was misleading or deceptive, or likely to mislead or deceive. Sixteen of those 17 customers did not in fact have Optus coverage and the remaining customer only had access to Optus coverage if the mobile phone was connected to an external antenna. This additional requirement was not communicated to the customer.
68 The ACCC also gave evidence that the Optus online checking tool did not provide for a result of “partial” coverage, even though that was the result recorded on Excite Mobile’s OLC database for at least one customer.
69 Mr Brown denied that Excite Mobile falsely represented to the affected customers that coverage was available and accessible at the customer’s house, and said that customers who advised Excite Mobile their area was not covered were asked if they wanted to enter into the contract despite being outside the covered area. Mr Brown also said that Excite Mobile offered to cancel contracts without penalty for those customers who later advised that they were not located in a covered area. In oral submissions, Mr Brown submitted that if a customer contracted with Excite Mobile, but no coverage was available, their service would be transferred to another network provided at no cost. In the early days of Excite Mobile, customers without coverage would be transferred to another provider, Online Telecoms (which used the Telstra network), but this was discontinued on account of the costs incurred by Excite Mobile.
70 Mr Samuel admitted that Excite Mobile represented falsely to the 17 affected customers that they would have coverage at the customer’s home address and that by that representation Excite Mobile engaged in conduct which was capable of being misleading or deceptive or did mislead or deceive some customers. Mr Samuel denied however that the representations were intentionally false, misleading or deceptive. Mr Samuel submitted that Excite Mobile had to rely on the address provided by the customer which may not have been the actual home address of the customer, and that the affected customers constituted a very small percentage of the total number of Excite Mobile customers, indicating that human error in checking Optus coverage, rather than an intention to make a false representation and mislead or deceive a customer, was the reason for the false representations.
71 The ACCC said that the representations about the TIC, namely, that it was an independent complaints handling organisation, were false, misleading and deceptive in that the TIC was not a complaints handling organisation for consumers of telecommunication services, that calls to the TIC number were answered by persons acting on behalf of Excite Mobile, and that the TIC was a construct of Excite Mobile designed to deceive customers into believing that they were raising complaints relating to the Excite Mobile telecommunications services with an independent complaints handling organisation.
72 The respondents admit that the representations made in respect of the TIC were false, misleading and deceptive, or likely to mislead and deceive.
73 Mr Brown, however, submitted that the purpose of the TIC was to encourage customers to register their complaints with Excite Mobile, thereby giving Excite Mobile an opportunity to resolve the matter before the customers registered their complaints with the Telecommunications Industry Ombudsman (TIO). He stated that the number was created because customers were contacting the TIO either prior to contacting Excite Mobile to discuss their concerns, or after contacting Excite Mobile and having told Excite Mobile that they were happy with the arrangement then entered into.
74 The ACCC submitted that Excite Mobile’s motivation is better understood by appreciating the cost of responding to inquiries of the TIO, which the respondents were aware of.
75 In an internal email from Mr Brown to Mr Saldanha, a manager of Lime India, on 16 September 2009, Mr Brown stated that “[t]he Escalations number can now be treated as though it is its own company.” He continued:
If the process is run this way why does the customer have ANY reason to go to the TIO?
We are doing the job of the TIO!
It is so so very important that the customer is encouraged to call the Escalations number. I have said before it SHOULD be given out at the start of a phone call when it is clear that the customer is not 100% happy.
If we do not basically INSIST that someone calls the Escalations phone number how are we going to stop people calling the TIO?
I would rather our Escalations number be called 20 times for each TIO case we get.
So considering that we have got 5 TIOs in 2 days.
As the last 5 TIO cases has cost me a fortune and this does not count the other 75 TIO cases we have had this year.
Do you really think that the Escalations number has cost us close to what these 75 TIO cases have cost us.
Any and I do mean any far out, crazy, waked out [sic], mental, fantastic IDEA that can stop or reduce the trend that is happening is so welcome that I can not start to express.
76 The escalation number was promoted during that time both in the activation script and any follow-up calls. The Welcome Pack also encouraged customers to call the escalation number. In a one page “escalation and complaint policy” under the heading “Choosing NOT to deal with Excite Mobile Directly” it states:
By law you have the right to have the TIO act on your behalf or have them involved. Excite Mobile will go to extremes to resolve your complaint where the TIO is NOT INVOLVED if however you wish to have the TIO involved we will only grant discounts or exceptions where LEGALLY OBLIGED TO, no other discounts or exceptions will be granted if you involve the TIO. We will insist full payment and charge for contract termination where we can and no discounts will be given. Quite simply, deal with us DIRECT! If you choose to take your case to the TIO any discount offer made by Excite Mobile will no longer be given.
So for this reason we ask that you try and resolve the complaint with us and you do not get the TIO involved unless you are 100% not happy with any resolution we offer you. However we do stress that we will try and resolve your complaint and give credits or discounts where possible, ONLY WHEN THE TIO IS NOT INVOLVED.
77 The ACCC submitted that the representations made by Excite Mobile in the Jerry Hastings letters were false or misleading in that Jerry Hastings was a fictitious character; the lawyer referred to was a fictitious character; the letters were not sent from an independent debt collector; at the time of sending the letters, Excite Mobile had no intention of instituting legal proceedings against the customer in respect of the alleged debt; and that if legal proceedings were instituted, Excite Mobile would not have had an entitlement to obtain orders for repossession of the customer’s assets, or all assets of value, or the children’s toys, nor to obtain orders requiring the customer to pay an additional 20% of the customer’s alleged debt for failing to pay on time. The ACCC said that such conduct was also misleading and deceptive, or likely to mislead or deceive.
78 The respondents said that Jerry Hastings was the anglicised name of Mr Punia, the officer in charge of debt collections. They also denied that the representations as to the intention to institute legal proceedings were false, in that Excite Mobile did intend to institute legal proceedings against customers who did not pay their accounts. Mr Samuel also denied that the representations as to Excite Mobile’s entitlement to orders for the repossession of customer’s assets, and orders requiring customers to pay the extra 20%, were false.
79 Subject to the above qualifications, the respondents admitted that sending the Jerry Hastings letters was conduct capable of being misleading and deceptive or did mislead or deceive some customers and that the representations were false or misleading.
80 The ACCC also submitted that Excite Mobile made representations that were false, by representatives of Excite Mobile answering calls by customers to the Jerry Hastings phone number, and representing that they were from Jerry Hastings’ office, and that Jerry Hastings was an independent debt collector engaged by Excite Mobile.
81 Mr Samuel admitted that the representations made were false and that this conduct was misleading or deceptive, or likely to mislead or deceive. Mr Brown and Ms Smart admitted that the representations were false, except that they said that Ms Smart informed some customers that Jerry Hastings was not independent of Excite Mobile and that Ms Smart only represented that Jerry Hastings’ office had no connection to, or was independent of, Excite Mobile on two occasions. Mr Brown and Ms Smart admitted that the conduct was misleading or deceptive or likely to mislead or deceive.
82 The ACCC further submitted that by sending one or more of the Jerry Hastings letters and operating the Jerry Hastings number as described above, Excite Mobile used coercion or undue coercion in order to obtain the satisfaction of the debts outstanding. Mr Samuel admitted that this conduct amounted to undue coercion. Mr Brown and Ms Smart denied that.
83 The ACCC also submitted that the sending of Jerry Hastings letters and operating the Jerry Hastings line amounted to unconscionable conduct. It submitted that the purpose of the letters was to create a state of mind in the addressee of the letters that there was no alternative but to pay the monies that Excite Mobile said they owed. The ACCC submitted that this purpose was pursued without regard to whether there were legitimate reasons for the non-payment of the amount said to be owing, and in circumstances where there may have been legitimate reasons for not paying the amount owing, given that most if not all of the addressees had purchased the phones by means of the sales method described above, and the amounts included those due by reason of the addressee exceeding the day cap, which the ACCC submitted is an unusual and onerous term. The ACCC submitted that the representation made about Jerry Hastings being an independent debt collector was intentional and deceitful, and that Excite Mobile used undue influence or pressure and unfair tactics against the customer in order to obtain agreement from the customer to pay an amount in satisfaction of his or her debt. In all the circumstances the ACCC submitted this amounted to unconscionable conduct.
84 In the course of its submissions, the ACCC referred to customer 112667 as an example of how the unconscionability of the conduct can be understood from the whole of the conduct. The OLC database records the initial complaint from the customer, that the customer thought he would receive two phones but only received one phone and that “he did not understand the voice contract also as the lady on the phone was very fast.” The OLC database notes a further call on 3 November 2009 described as “esc. no. resolution” which was also recorded. During that call, the customer described how he had entered into a contract, and that as part of that contract, he understood he would be sent two phones, but only one had been received. The telephone operator represented that “the number [the customer is] calling is a Telecommunication Industry Complaints number, ok?” and then asked what company the customer was calling in regard to. The customer then explained again that he understood that he was to receive two phones instead of one, and for $40 a month, instead of $30 a month, and said that when the voice contract was read to him he could not understand the telemarketer, such that the customer did not know what was in the voice contract “cause he was talking that fast”. The telephone operator then said that he would forward the complaint to Excite Mobile and that Excite Mobile would return the call.
85 On 5 March 2010 the OLC database records an additional call made by the same customer, saying that the phone received was broken and that he could not send text messages, and that he had tried to transfer the phone back to Optus but could not get the code from Excite Mobile in order to transfer the phone number back. The “TIO resolution call” on 12 March 2010, records:
Called him back, says I ported my no. in January with Optus. Why are you sending me bills. Says Optus did inform you about porting.
Told him a) He or Optus never informed us about the same. However he will be liable to pay his current outstanding plus the cancellation charges.
b) Told him that we never got a call from Optus informing porting of the number.
Says the bills say I have made calls, how can I make calls, if I cracked the sim and burn it. Kept on abusing and said he will not be paying a single cent and hung up twice.
I have checked UB, he hasn’t paid his bill since Dec. 09. Have disconnected the services.
86 A Jerry Hastings Times are Bad letter was sent on 6 April 2010, and a Jerry Hastings Reminder was sent on 27 April 2010.
87 The ACCC submitted that looking at all the circumstances in which this debt came about, the sending of the Jerry Hastings letters amounted to harassment and undue coercion.
88 Mr Samuel admitted that by the Jerry Hastings letters and calls, Excite Mobile engaged in unconscionable conduct.
89 Mr Brown and Ms Smart denied that the conduct amounted to unconscionable conduct. They said that the letters were sent to recover amounts owing to Excite Mobile by offering a repayment plan and a percentage reduction in the amount owed and to request customers to make contact, and that threatening a debtor with legal action in order to obtain payment is not unconscionable.
90 They also denied the conduct amounted to undue coercion. The letters, they submit, raise the threat of legal action which was a step that Excite Mobile was considering. The possibility of obtaining a sum over and above the outstanding sum was also not necessarily false, they said, as a judgment creditor can obtain costs, and orders for the sale of personal or real property. Further, the letters were only designed to be sent once each and that any resending of the letters was a clerical error.
91 Excite Mobile ceased sending the various Jerry Hastings letters around July 2010. Mr Brown made conflicting statements about the reason that those letters were no longer being sent. In his submissions he stated that no further letters were sent because it was apparent the ACCC was unhappy with the letters. This accords with his s 155 statement, where he states that they stopped sending the letters because “[the ACCC] weren’t happy.” In evidence, Mr Brown said that the letters were not sent after July 2010 because the letters were not resulting in recovered fees.
Liability of Mr Brown
92 The ACCC submitted that Mr Brown was directly knowingly concerned in or party to each contravention of the TPA by Excite Mobile.
93 Mr Brown admitted that he was responsible for the operations of Excite Mobile including the establishment of Excite Mobile’s business operations, drafting the content for and authorising the use of the telemarketing scripts, designing the method by which Excite Mobile promoted and supplied the mobile telecommunications services to customers, authorising the terms of the contract, drafting the content for and authorising the use of the Jerry Hastings letters, and making the representations to customers who made calls to the Jerry Hastings number, or directed that such representations be made.
94 Mr Brown admitted being a person involved in the contraventions of the TPA with respect to the representations regarding the TIC, as well as the contraventions admitted in respect of the Jerry Hastings letters and calls, namely that that conduct amounted to false representations, and that the representations were misleading or deceptive or likely to mislead or deceive. Mr Brown also conceded during cross-examination that the complaints received by Lime India were relayed to him and that he was aware that complaints were being received immediately after starting to sell the day cap.
95 Mr Brown denied, however, that the sales method employed was unconscionable, that the mobile phone coverage representations were false, or misleading or deceptive, and that the Jerry Hastings letters and calls amounted to undue coercion and were unconscionable. Accordingly, accessorial liability was also denied in respect of those alleged contraventions.
96 In essence, he accepted that to the extent to which Excite Mobile is found to have contravened the TPA, he was knowingly concerned in or a party to its contravention. Given his role in the establishment and operations of Excite Mobile, that was an appropriate position to adopt. But he disputed that Excite Mobile engaged in unconscionable conduct, or contravened the TPA, by sending the Jerry Hastings letters.
Liability of Mr Samuel
97 Mr Samuel admitted that he was at all material times responsible as a director for the operations of Excite Mobile including the establishment of Excite Mobile’s business operations, designing the method by which Excite Mobile promoted and supplied mobile telecommunication services to customers, and authorising the terms of the mobile contracts. However, he attempted to some degree to distance himself from the detail of establishing and operating its systems.
98 Mr Samuel submitted that the day cap was devised by Mr Brown and the scripts used were developed by Mr Brown and that Mr Samuel did not authorise the scripts prior to use by the call centre. He acknowledged that he did not object to the day cap plan or the scripts and accepted such responsibility as lay upon him as a director of Excite Mobile. The extent of his involvement in the development of the contract terms, he said, was an initial 40 minute conversation, in which Mr Brown discussed his idea of a day cap. Mr Samuel said that at that time, no other mobile networks or service providers were offering the day cap. Mr Samuel said that he trusted Mr Brown to be diligent in checking the scripts, to ensure that they explained the day cap. Mr Samuel said that he did not co-author the scripts, but that he was provided with a copy of the draft scripts before they were sent to the telemarketing services.
99 Mr Samuel admitted that he was aware that people were complaining about the impacts of the day cap and that there were better offerings in the market. Mr Samuel agreed that the voice contract scripts failed to fairly and adequately explain the operation of the day cap.
100 With respect to the sales method, Mr Samuel stated that he always understood that the complete list of fees and charges was included in the Welcome Pack received by the customer. Mr Samuel admitted that the terms of the Welcome Pack were not incorporated into the contracts. He also believed that the direct debit authority applied only to customers with poor credit profiles, and that he was not aware of what practice was adopted as only Mr Brown was responsible for the direct debits and billings in respect of Excite Mobile.
101 With respect to the coverage representations, Mr Samuel submitted that the representations made were not intended to, and that neither Excite Mobile nor Mr Brown or Mr Samuel intended for the company to, represent that customers would have coverage when in fact they did not.
102 With respect to the TIC representations, Mr Samuel said that he did not make the decision to advise customers to call the TIC phone number, that he was not involved in the registration of the business name as that was carried out by Mr Brown without the knowledge of or the authorisation of or any consultation with Mr Samuel, and that he did not authorise the content of the activation script.
103 Mr Samuel later admitted in the course of the hearing that he was involved in the registration of the business name. On 19 January 2010 Mr Brown sent an email to Mr Samuel, stating:
Telecom Customer Complaints
Telecom Network Complaints
Telecom Company Complaints
Telecom Business Complaints
I sent all 4 so if they bloody don’t approve one of these I am going to be pissed off… Top one would be best. But then it is much like TIO :(
104 Mr Samuel replied on the same day: “Perfect, either one of them is fine man …”.
105 Mr Samuel also denied making the decision to advise customers to contact the TIC number, and denied that he was aware of the statements made to customers directing customers to contact the TIC number. Mr Samuel admitted that once he knew the practice existed he did not give instructions to operators or to the other respondents to stop advising customers to call the TIC number to the extent that he could have as a director. He cited his workload and responsibilities with Lime Australia as the reason for not making more detailed inquiries into the operation of TIC or trying to stop the use of that name in the way it was used.
106 In the course of the hearing, Mr Samuel admitted that he was aware that complaints were being made to the TIO. There was some question during the hearing as to whether Mr Samuel had been a recipient of the email quoted above from Mr Brown to Mr Saldanha of 16 September 2009. The first copy provided to the Court by Mr Samuel did not include the panel of “carbon copy” addressees who had also received the communication. A subsequent copy included the carbon copy, and showed that the email had been sent to Mr Samuel as well. There was some suggestion made that the copy Mr Samuel provided had been doctored to remove the “cc” reference which showed that Mr Samuel had been a recipient of that email. Mr Samuel later admitted that he had received that email but said that he did not read it.
107 Another email of 3 August 2009 was sent by Mr Brown to Lime Managers, where Mr Brown discussed script changes to reference the complaints / escalation phone number at the end of the call. In Mr Samuel’s s 155 examination he stated that he received emails sent to that address. This conflicted with his evidence at the hearing, where he stated that he was not sure whether he received emails to that address.
108 More generally Mr Samuel advised that he did not read many of the emails directed towards him in a generic way as a manager of Lime Australia or Lime India because these were automatically filtered by his email account, and moved into a separate folder and that in fact he had 18,600 unread emails.
109 Regarding the Jerry Hastings letters, Mr Samuel submitted that he did not create or approve the Jerry Hastings letters, had no knowledge of the contents of the same, did not know about the order in which the letters were forwarded to customers, nor how many letters were sent, nor the dates on which they were sent. Mr Samuel submitted that he did not create the letters, that he had no knowledge of the letters until on or about 14 January 2010, that the sending of the letters was not part of the business of Excite Mobile under the control of Excite Mobile, and that Excite Mobile was experiencing financial difficulties at the time of sending the letters. He admitted that he took no action to stop the sending of the letters. Mr Samuel also denied being aware of the Jerry Hastings calls, and said that this came to his knowledge after the event.
110 Mr Samuel’s email to Mr Brown of 4 January 2010 appears to conflict with his submission that he had not reviewed the Jerry Hastings letters. He wrote:
Yeah, cool as - likewise. So gone through the letter, haven’t spell checked it, but all looks good 2 go for at least a test of 100 or so, as Reg Post costs $3.00 or something stupid, but its the only way.
111 The email sent in reply from Mr Brown included the Times are Bad letter in full, and stated:
Cool man… few more changes to letter I think I am just about finalized it about now though.
112 Mr Samuel did not concede that his email referred to the Times are Bad letter, and suggested that his comment may have meant that he may not have looked at it, or that he had skim read it at best.
113 On 9 January 2010 Mr Brown emailed Mr Samuel a copy of the Last Warning letter, stating “If you can review the below letter let me know what you think.” Mr Samuel replied on 11 January 2010, saying:
Fuk oath, I read this on my iphone on saturday, it all seems good 2 me man. Nothing needs deleting really that i can see or that will make any impact on the letter in any case
114 Another email was sent on 29 January 2010 by Mr Brown to Mr Punia, Mr Grover and Ms Saldanha and “cc-ed” the managers at Lime India and the managers at Lime Australia. This letter included a draft of the Jerry Hastings “Overdue” letter. Mr Brown stated:
This is much the same, first page is same but now we have 2nd page that talks about centrepay, and then 2 final pages which is a pre filled in centrepay deduction form.
We are pressing hard on trying to get people to sign up for centrepay.
This form encourages people to do just that. Signup for centrepay and pay of there bills. Or signup and have this as their preferred payment method.
115 On 31 January 2010 Mr Samuel wrote to Mr Brown:
How is everything going with collections? Processes are starting to take place?
How many collection plans are in place right now with the Jerry Hastings letter, as we spent quite a bit already with Reg Post & all… are we on track to cover costs & actually make people pay & are sticking to arrangements as yet? How many people do we need to spend $116 on + Serve to take them to court?
I know its early days as yet, but if you could do me the courtesy of keeping me in the loop that would be great man.
116 Mr Brown replied the same day, stating:
Things are looking good…
So the results that we have so far are from 200 letters we sent.
200 Sent letters
155 Sent reminder letters
1 – Banrupcy [sic] (confirmed)
2 – Refusing To Pay
21 – Payment Plan Agreement
3 – Pay Agreement SIGNED
27 – Return to Sender
So the results we are looking at is 24 commitments to pay. Of which a number have paid but not just sure how many yet.
We need to do up a FULL ON COURT looking letter that is the final freak out letter !
This is the one thing that I do need your help on as we spoke about. I am putting my focus right now back on the overdue cases and then on the 30 day and 60 day letters.
117 Ms Smart said that when receiving complaints on the Jerry Hastings number she would pass these on to Mr Brown and the managers of Lime India, including Mr Samuel. She said that at each instance she would make a selection as to who to inform, depending upon who could help her the most. Mr Samuel, she said, never gave her written directions, but would give her oral instructions every time she went to the offices.
118 More generally, Mr Samuel submitted that he was only nominally involved in the day-to-day operations of Excite Mobile. Mr Samuel submitted that most of his time was spent in the business of Lime Australia, which was a separate business. Lime Australia was located at 117A Henley Beach Road, while Excite Mobile was located at 117B Henley Beach Road. There were no internal doors that connected the two offices, although they were physically in the one building. There were separate front doors to each office.
119 Lime Australia continued to run the customer service and accounts of people who had, prior to Excite Mobile’s existence, contracted for mobile phone services with Lime Australia. Lime Australia at that time was also selling phones on eBay as well as conducting a small graphic design business. Mr Brown says that he had the same level of involvement in this work as Mr Samuel. Mr Brown further submitted that 95% of their work was with Excite Mobile and so it would not have made sense for Mr Samuel to spend all his time on Lime Australia and not Excite Mobile. Mr Brown says that he did more of the “grunt work” but that the responsibility to make decisions was shared evenly.
120 In Mr Samuel’s s 155 investigation, he stated that as a director, he received daily reports on Excite Mobile by email, and that when things were going well, he would send the appropriate staff in Lime India a quick email “just congratulating them.” In his s 155 examination, he also stated that he talked to Mr Brown on a daily basis about the business operations, and that he knew what was going on because of these daily chats. This is inconsistent with his oral evidence. During the hearing, Mr Samuel stated that the number of occasions in a week on which he would talk to Mr Brown about the operations of Excite Mobile varied from none to three or four occasions in any given week.
Liability of Ms Smart
121 The ACCC submitted that Ms Smart sent the Jerry Hastings letters or most of them, that she made and received the Jerry Hastings calls, and that when making the Jerry Hastings calls, she generally herself made the representations mentioned above. The ACCC submitted accordingly that she was directly knowingly concerned in, or party to, each contravention of the TPA by Excite Mobile with respect to the Jerry Hastings conduct.
122 Ms Smart admitted that she sent the Jerry Hastings letters and that she made and received the Jerry Hastings calls to and from customers, but says she acted only in a clerical capacity.
123 Ms Smart says that she provided assistance by proofreading emails and other communications drafted by Mr Brown. She stated in her evidence that she did not consider that she worked for Excite Mobile, but that she was doing the work for Mr Brown, Mr Samuel and Mr Hastings.
124 Ms Smart gave evidence that her work was a loose arrangement and that initially she was going to be paid by Excite Mobile, but in the end it was Mr Brown who paid her, because Excite Mobile did not have the funds. Most of her work was conducted from home, where she had access to the OLC database.
125 Ms Smart admitted that she was involved in the drafting of the Jerry Hastings letters, by editing the document, and expressing her view that she thought the letter was too strong. She agreed in cross-examination that the feedback she gave to Mr Brown was more than just grammatical correction. Ms Smart also stated that she would communicate about the complaints of the customers to various people, including Mr Brown and Mr Samuel.
126 In one Gmail chat between Ms Smart and Mr Brown, on 1 February 2010 she stated:
I just listened to a voice contract from a guy that called in today and said Excite Mobile clearly lied about the package, which is actually true. The first chick says, “Excite Mobile camera, mobile phone and holiday package at absolutely no cost”. You need to stop that ASAP.
127 Between 11 January 2010 and about 23 June 2010, the telephone calls made by customers to the Jerry Hastings number were answered primarily by Ms Smart, and returned primarily by Ms Smart. In those telephone calls, Ms Smart represented to customers that they were calling Jerry Hastings’ office, that Jerry Hastings was a debt collector for Excite Mobile and that Jerry Hastings was independent of Excite Mobile.
128 In one example (customer 102371), the customer advised that the State Trustee was taking care of the liability, and another person on the same line said there shouldn’t even be a bill because the phone was sent back. Ms Smart answered that she is from a collection agency and has nothing to do with Excite Mobile, and then requested contact details of the trustee. The customer refused and Ms Smart answered “Okay. I’ll take him to court. Thank you very much. Goodbye.” Ms Smart admitted that this was not an appropriate way to respond to the customer’s information.
129 Ms Smart admitted to knowing that the picture attached was not Jerry Hastings, and that the lawyer referred to was a fiction. Like Mr Brown, she admitted that the customer would believe that she was not from Excite Mobile, but she did not consider that to be deceptive, nor did she agree that she deliberately deceived the callers.
130 Ms Smart conceded that fairly close to the majority, if not the majority, of the payment plans were entered into with customers who were on Centrelink payments.
131 As might be expected, the evidence adduced by the ACCC was largely documentary or electronic. The material was proved through an officer of the ACCC. There was no cross-examination of that officer. There was no submission that the documentary or electronic evidence was inaccurate or selective. In particular, the sampling of various telemarketer calls as random, and therefore representative, in general terms, was also not challenged.
132 I accept that evidence.
133 The ACCC also called Vincent Mullins, an officer of Optus. He said that between 24 December 2008 and 4 November 2010, Optus had three online coverage checking tools to show the extent of coverage of the Optus mobile telecommunications network. They provided checks on Optus coverage by address, postcode or suburb. Those checking tools could not produce a “partial result”. He was cross-examined, but his primary evidence remained unchallenged. I accept it. Obviously, that evidence has significance to the coverage representations and the comments of Excite Mobile and the other respondents on that topic.
134 The ACCC also called Neil Robinson, another officer of Optus. His evidence was not challenged by cross-examination. It also related to the coverage representations. The ACCC provided him with a list of 20 addresses throughout Australia, and a transaction date, varying between 21 January 2009 and 29 January 2010. For 17 of them, Optus provided no coverage. For the other three, one had planned (but not commenced) on-street coverage only, one had on-street coverage at the time of the transaction date, and one had limited coverage by use of an external antenna.
135 I accept that evidence also.
136 Each of Mr Brown, Mr Samuel and Ms Smart also gave evidence.
137 As noted, Mr Brown accepted that Excite Mobile under his direction or management engaged in the conduct alleged by the ACCC. He did not attempt to distance himself from that conduct. His evidence, to some degree, sought to characterise the conduct as conduct that did not contravene the relevant provisions of the TPA. He was, of course, entitled to take that view, and I am not critical of his evidence for that reason. Really, it amounts in part to an assertion about his state of mind and in part to a submission on behalf of Excite Mobile and himself. Whether the admitted conduct has the character attributed to it by the ACCC is a matter for the Court, and Mr Brown’s evidence disputing that character to the extent it did was not aimed at securing a finding that he was not a party to, or knowingly involved in, that conduct by Excite Mobile.
138 There was some difference between Mr Brown and Mr Samuel about the extent of Mr Samuel’s knowledge of, and involvement in, the day-to-day operations of Excite Mobile. Mr Samuel’s evidence exhibited a degree of cautiousness, which struck me as bordering on the evasive. He accepted his responsibilities as a director of Excite Mobile, but said he left the running of the business primarily to Mr Brown, and that his primary focus was the business of Lime Australia.
139 So, he said, although he knew of the day cap plan, it and the telemarketing scripts were the creation of Mr Brown almost exclusively. He accepted that he had arranged for the engagement of Lime India to act as telemarketer for Excite Mobile. Similarly, he said he had no real role in securing the TIC number or the strategy related to its use or in the context of any of the Jerry Hastings letters.
140 The material set out under the “Claims and Responses” heading of this judgment addressing Mr Samuel’s position includes references to several occasions when Mr Samuel’s knowledge of, or actions in relation to, the TIC number and its usage and the content of the Jerry Hastings letters and their usage was greater than Mr Samuel said was the case in his evidence-in-chief. Consequently, I am cautious about taking all of Mr Samuel’s evidence at face value. Nevertheless, both Mr Brown and Mr Samuel agreed that the primary focus of Mr Samuel was on the Lime India business, so I accept that he was not as directly involved in operating the Excite Mobile business as Mr Brown. It will be necessary to make findings about Mr Samuel’s role in relation to the particular conduct of Excite Mobile which I find contravened the TPA as alleged by ACCC. In making the findings about Mr Samuels’ involvement in those contraventions, I have had regard to the caution with which I approach his evidence. Clearly, however, his role was not simply as a director of Excite Mobile remote from its day to day operations.
141 Ms Smart’s evidence was apparently given in a direct and frank way. She did not shy away from the conduct she obviously undertook on behalf of Excite Mobile. I have no reason not to accept her evidence.
142 It is convenient first to briefly advert to the concepts of unconscionability, false and misleading conduct, and coercion as they appear in the TPA.
143 The following material is not contentious.
144 On the topic of unconscionability, s 51AB of the TPA provides:
(1) A corporation shall not, in trade or commerce, in connection with the supply or possible supply of goods or services to a person, engage in conduct that is, in all the circumstances, unconscionable.
(2) Without in any way limiting the matters to which the court may have regard for the purpose of determining whether a corporation has contravened subsection (1) in connection with the supply or possible supply of goods or services to a person (in this subsection referred to as the consumer), the court may have regard to:
(a) the relative strengths of the bargaining positions of the corporation and the consumer;
(b) whether, as a result of conduct engaged in by the corporation, the consumer was required to comply with conditions that were not reasonably necessary for the protection of the legitimate interests of the corporation;
(c) whether the consumer was able to understand any documents relating to the supply or possible supply of the goods or services;
(d) whether any undue influence or pressure was exerted on, or any unfair tactics were used against, the consumer or a person acting on behalf of the consumer by the corporation or a person acting on behalf of the corporation in relation to the supply or possible supply of the goods or services; and
(e) the amount for which, and the circumstances under which, the consumer could have acquired identical or equivalent goods or services from a person other than the corporation.
(3) A corporation shall not be taken for the purposes of this section to engage in unconscionable conduct in connection with the supply or possible supply of goods or services to a person by reason only that the corporation institutes legal proceedings in relation to that supply or possible supply or refers a dispute or claim in relation to that supply or possible supply to arbitration.
(4) For the purpose of determining whether a corporation has contravened subsection (1) in connection with the supply or possible supply of goods or services to a person:
(a) the court shall not have regard to any circumstances that were not reasonably forseeable at the time of the alleged contravention; and
(b) the court may have regard to conduct engaged in, or circumstances existing, before the commencement of this section.
(5) A reference in this section to goods or services is a reference to goods or services of a kind ordinarily acquired for personal, domestic or household use or consumption.
(6) A reference in this section to the supply or possible supply of goods does not include a reference to the supply or possible supply of goods for the purpose of re-supply or for the purpose of using them up or transforming them in trade or commerce.
(7) Section 51A applies for the purposes of this section in the same way as it applies for the purposes of Division 1 of Part V.
145 The term “unconscionable” is not itself defined in the TPA.
146 The Full Court considered the meaning and application of s 51AB in Hurley v McDonald’s Australia Ltd  FCA 1728 at :
For conduct to be regarded as unconscionable, serious misconduct or something clearly unfair or unreasonable, must be demonstrated – Cameron v Qantas Airways Ltd (1994) 55 FCR 147 at 179. Whatever “unconscionable” means in sections 51AB and 51AC, the term carries the meaning given by the Shorter Oxford English Dictionary, namely, actions showing no regard for conscience, or that are irreconcilable with what is right or reasonable – Qantas Airways Ltd v Cameron (1996) 66 FCR 246 at 262. The various synonyms used in relation to the term “unconscionable” import a pejorative moral judgment – Qantas Airways Ltd v Cameron (1996) 66 FCR 246 at 283-4 and 298. (emphasis in original)
147 The level of moral obloquy required is high: Australian Securities and Investment Commission v National Exchange Pty Ltd (2005) 148 FCR 132 at ; CIT Credit Pty Ltd v Keable  NSWCA 130. That would not ordinarily be present if the critical actions were merely negligent: Australian Competition and Consumer Commission v Allphones Retail Pty Ltd (No 2)  FCA 17 ; Ibarcena v Huang S & W Pty Ltd  FCA 752 .
148 Conduct can be found to be unconscionable even though it is not misleading, and conversely, conduct which is misleading is not necessarily unconscionable: Australian Securities and Investments Commission v National Exchange Pty Ltd (2005) 148 FCR 132; CIT Credit Pty Ltd v Keable  NSWCA 130.
149 The ACCC submitted that in all the circumstances of the calls made to consumers by Excite Mobile representatives, the sales tactics and methods used to make the mobile contracts fall within the prohibition in s 51AB(1).
150 In terms of the factors that were listed in s 51AB(2), the ACCC submitted that the following are relevant with respect to the sales tactics employed by Excite Mobile.
1. Excite Mobile is in a position of relative advantage over the customer, by knowing the full terms and effect of the mobile contract and day cap, and the consumer is in a position of relative disadvantage by being reliant upon Excite Mobile for an explanation of the terms and effects of the mobile contracts and day cap: s 51AB(2)(a).
2. The fact that consumers were not able to understand documents relating to the terms and effects of the mobile contracts and day cap is evident from the large number of consumers that incurred such high excess usage charges, and the fact that such high excess usage charges were incurred within the first month or shortly after the contract commenced: s 51AB(2)(c).
3. Undue pressure was exerted on and unfair tactics were used against the consumer by Excite Mobile in the structure, delivery and content of the marketing calls: s 51AB(2)(d).
151 During the hearing much was said about the apparent uncommerciality or uncompetitiveness of the product offered by Excite Mobile. Offering an uncompetitive product does not in and of itself amount to unconscionability. It may however demonstrate that the customers had no understanding of the product offered.
152 In Australian Securities and Investments Commission v National Exchange Pty Ltd (2005) 148 FCR 132 at  the Court considered the applicability of common law principles of unconscionability and the TPA, concluding at  on the facts of that case that:
[T]here must be some doubt as to whether the recipients who accepted the offers were able to understand the offer document, since, on its face, it is difficult to see why or how a recipient would be persuaded to part with shares, without any bargaining, where the price offered was admitted by the offeror to be substantially less than half the offeror’s estimate of the value of the shares, and less than one-quarter of the initial market price of the shares.
153 That passage continues at :
Another of the listed considerations is the extent to which the supplier acted in good faith. On the evidence and concessions before the court as to Tweed’s strategies, it cannot be suggested that the conduct of Tweed was undertaken in good faith.
National Exchange set out to systematically implement a strategy to take advantage of the fact that, amongst the official members, there would be a group of inexperienced persons who would act irrationally from a purely commercial viewpoint, and would accept the offer. They were perceived to be vulnerable targets, and ripe for exploitation, as they would be likely to act inadvertently and sell their shares without obtaining proper advice, and they were a predictable class of members from whom Tweed could procure a substantial financial advantage by reason of their commercially irrational conduct. This is not a case of shrewd commercial negotiation between businesses within acceptable boundaries. The conduct can properly be described as predatory and against good conscience.
154 The ACCC submitted that that passage is applicable to the facts and circumstances of this case.
155 The principles surrounding misleading and deceptive conduct, and false representations were not contested. Section 52 provides:
(1) A corporation shall not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive.
(2) Nothing in the succeeding provisions of this Division shall be taken as limiting by implication the generality of subsection(1).
156 Campomar Sociedad Limitada v Nike International Ltd (2000) 202 CLR 45  affirmed that the “question whether particular conduct causes confusion or wonderment cannot be substituted for the question whether the conduct answers the statutory description contained in s 52” and at  that “the legislation did not impose burdens which operated for the benefit of persons ‘who fail[ed] to take reasonable care of their own interests.’”
157 Section 53 relevantly provides:
A corporation shall not, in trade or commerce, in connexion with the supply or possible supply of goods or services or in connexion with the promotion by any means of the supply or use of goods or services:
(c) represent that goods or services have sponsorship, approval, performance characteristics, accessories, uses or benefits they do not have;
(g) make a false or misleading representation concerning the existence, exclusion or effect of any condition, warranty, guarantee, right or remedy.
158 Section 60 provides:
A corporation shall not use physical force or undue harassment or coercion in connection with the supply or possible supply of goods or services to a consumer or the payment for goods or services by a consumer.
159 There is no definition of “undue harassment or coercion” or any of those words individually in the TPA.
160 In Australian Competition and Consumer Commission v Maritime Union of Australia  FCA 1549, Hill J explained the terms as follows at -:
The word “harassment” in my view connotes conduct which can be less serious than conduct which amounts to coercion. The word “harassment” means in the present context persistent disturbance or torment. In the case of a person employed to recover money owing to others, as was the first respondent in McCaskey, it can extend to cases where there are frequent unwelcome approaches requesting payment of a debt. However, such unwelcome approaches would not constitute undue harassment, at least where the demands made are legitimate and reasonably made. On the other hand where the frequency, nature or content of such communications is such that they are calculated to intimidate or demoralise, tire out or exhaust a debtor, rather than merely to convey the demand for recovery, the conduct will constitute undue harassment (see per French J in McCaskey at )…
“Coercion” on the other hand carries with it the connotation of force or compulsion or threats of force or compulsion negating choice or freedom to act: see Hodges v Webb  2 Ch 70 at 85-7 per Peterson J. A person may be coerced by another to do something or refrain from doing something, that is to say the former is constrained or restrained from doing something or made to do something by force or threat of force or other compulsion. Whether or not repetition is involved in the concept of harassment, and it usually will be, it is not in the concept of coercion.
It is clear that the word “undue” suggests that what is done must, having regard to the circumstances in which the conduct occurs, extend beyond that which is acceptable or reasonable. It thus adds, as French J observes at paragraph 48 in McCaskey, “an extra layer of evaluation”. The word “undue”, when used in relation to harassment, ensures that conduct which amounts to harassment will only amount to a contravention of the section where what is done goes beyond the normal limits which, in the circumstances, society would regard as acceptable or reasonable and not excessive or disproportionate. It would, however, be somewhat unusual to qualify the concept of coercion with the word undue. If there is such a qualification it would suggest that the policy behind s 60 accepted that some normal level of coercion or force overbearing choice or will was, having regard to the circumstances in which the conduct occurred, acceptable or reasonable in a civilised society and that it was only where that acceptable level of coercion was exceeded so that the coercion became “undue” that coercion was intended to be prohibited. I note that J D Heydon in Trade Practices Law (2nd edition at [13.620]) likewise is of the view that undue does not qualify coercion. But if undue does qualify coercion it would not seem to add much to it, whereas I am of the view that qualitatively the word “undue” adds the quality of unreasonableness, unacceptability or lack of proportionality to the general concept of harassment.
161 In Australian Competition and Consumer Commission v McCaskey (2000) 183 ALR 159, referred to in the passages just quoted, French J said at :
The collection of debts may involve coercion in the sense that the debtor is subjected to the pressure of the demand and the legitimate threat of civil process for recovery with the additional cost and damage to credit which that can involve. Such pressure may be thought of as coercion but is entirely legitimate and not “undue”. Where the demand includes content which does not serve legitimate purposes of reminding the debtor of the obligation and threatening legal proceedings for recovery but is calculated otherwise to intimidate or threaten the debtor, then the coercion may be undue.
It is apparent from that passage that French J, contrary to the views of Hill J, had taken the view that the term “undue” in s 60 applied to both the concepts of harassment and coercion.
162 In this matter, I do not think that difference of opinion affects the outcome of the proceeding.
163 I now turn to record my findings and conclusions.
164 I have focused on the Excite Mobile $33 per month plan with a day cap of $2.20 as, on the evidence, that is the plan which the majority of its customers took up. I do not think that consideration of the other two options it offered makes any different to the conclusions, other than noting the obvious – that the higher the daily limit, the less likely it is that the daily limit will be exceeded. The respondents’ submissions did not suggest a need to separately make findings or reach conclusions about the two alternative options.
165 In my judgment, the mobile telephony services promoted and supplied to consumers by Excite Mobile involved some unusual features.
166 Foremost among them is the day cap. It was a feature which was unusual because, at least for the $33 monthly plan, the day cap of $2.20 effectively gave the consumer little or no real usage before the considerably higher rates for services kicked in. The evidence shows that two brief outward telephone calls and one text message would exceed the daily $2.20 allowance. Subsequent usage on any one day incurred fees of 35 cents flag fall and 55 cents per thirty seconds, so (for example) once the cap was exceeded a four minute phone call would incur fees of $4.75. The daily cap was not a feature of other phone plans available at the time. The evidence about the significant numbers of consumers who, within a month of agreeing to an Excite Mobile offer, had bills very considerably in excess of the $33 monthly fee and were distressed by the much higher bill than they had anticipated, suggests the daily cap – both conceptually and practically (that is, how many phone calls it would cover) – was not readily understood.
167 Secondly, Excite Mobile became entitled to direct debit a consumer’s nominated account at its discretion, once the account of that customer reached $50 of unbilled calls.
168 Thirdly, Excite Mobile could charge a $75 fee if a consumer, having entered into a contract, exercised the “cooling off” rights.
169 Fourthly, Excite Mobile could charge $195 for any damage to a mobile phone (including to its packaging) if the “cooling off” rights were exercised and the phone was returned, and the concept of damage meant that opening the package in which the mobile phone was delivered was sufficient to activate that entitlement.
170 In effect, “cooling off” could, at Excite Mobile’s discretion, lead to billing of $260 in any event, made up of the cooling off fee and the damage fee. There is no evidence to support the $75 fee as reasonable, or as related to costs actually incurred by Excite Mobile in providing the packaged product and associated material to the consumer and in processing its return. The evidence is not very detailed, but suggests that the cost to Excite Mobile of the mobile phone itself as packaged was about $100, so the “damage” fee potentially incurred simply by unpacking the mobile phone is almost twice its cost to Excite Mobile.
171 It is, of course, necessary to see how those features of the Excite Mobile package were conveyed to potential consumers of its services. The proposed telemarketing scripts, and the forms of script actually used, are set out above. It is not unfair to describe the three stages of a telemarketer’s presentation as the sales pitch, gathering the consumer details, and the contract stage. It will be necessary to refer to the contract stage in a little more detail when considering the misrepresentations alleged by the ACCC.
172 In my view, having regard to the actual telemarketing script and the random sampling (which I accept is typical) of telemarketing interviews, the sales method does not describe the operation of the day cap in an adequate manner. The sales method starts with the bait. There is nothing wrong with that of itself. But the telemarketing process is pushy and does not accommodate any pause for reflection on the part of the consumer. The sales pitch uses the term day cap only fleetingly, and does not explain it at all. Its nature, as explained above, was of such significance that it should have been properly explained – as to how it operated, including what it might cover and not cover in a practical sense, so that the consumer might have some information about when the day cap might be exceeded and the cost of phone calls or other services once the day cap was exceeded. The day cap itself is explained – in the sense of pointing out that any unused daily allowance does not accumulate – during the contract stage only, but then it is described only quite briefly along with a raft of other fees and conditions. Although the consumer could, of course, withdraw from any further discussions at that point, a consumer would not appreciate the risk of exposure to monthly bills well exceeding the monthly call allowance and that risk was not really explained. The bait of the “free” phone, the holiday benefits and a low monthly fee had, by then, been taken. The contract stage, and indeed the whole of the presentation, gave a consumer little time for thought or for questions, or to measure value against cost and potential cost in the particular circumstances of that consumer. Until the contract stage, the bait described is the dominant element, and the focus is on getting up to $66 worth of calls per month for $33 per month.
173 Mr Brown accurately said the Excite Mobile plan was best suited to infrequent phone users who primarily receive incoming calls. He also said in his examination under s 155 that the plan was not suited to the “everyday user”. Both statements are obviously true. That serves to emphasise the distance between the apparent expectations of consumers who took up an Excite Mobile contract based on the way in which the plan was marketed and what they were really getting. That distance is exhibited by the evidence about the sample of users, and a few individual instances. The sample of 10 of the users taken by the ACCC (not specifically selected to make a point) showed that they used the Excite Mobile service for an average of 26 days before being barred or suspended by Excite Mobile. By the time of barring or suspension (less than one month) the average amount owing was $535.27; that figure had increased to an average of $1030.31 by the end of 2010 when Excite Mobile was required to provide information to the ACCC under s 155 of the TPA.
174 One consumer’s experience readily explains how that position (as averaged) was arrived at. On 2 June 2009, the consumer contracted for an Excite Mobile service, activated on 7 July 2009. The first monthly statement issued was for $521.95, which the supporting account could not satisfy by direct debit. That debt after month one is well over 15 times the $33 monthly fee. The service was not then used. For each of the next three months, there was a debit of the $33 monthly fee and a $16.50 late payment fee. On 26 November 2009, Excite Mobile disconnected the account, and a further disconnection fee was added of $99. During 2010, the monthly fee and late payment fees were added, so by 28 November 2010 the unpaid account was $1445.45. That example can provide an illustration of three things: the lack of awareness of the consumer about the way the day cap operated, the potential for very increased charges for usage beyond the day cap, and the way the charges under the oral contract could accumulate, despite the non-usage of the service. The second of those things was not made a particular focus in the unconscionability claim by the ACCC, and I have not taken it into account.
175 I consider that the sales method adopted by Excite Mobile for promotion of its day cap plan was in all the circumstances unconscionable.
176 The above findings indicate how the plan was marketed, and how the plan operated. It was not a plan which was suitable for most users of mobile telephones, for obvious reasons, and indeed its adoption by the “everyday users”, to adopt the phrase of Mr Brown, was clearly unsuitable for them, and would be likely to expose them to very significant additional monthly charges. There may be some consumers for whom it was suited, with its tailoring to provide low monthly rates for consistent very limited daily usage. That is not how the plan was marketed. It was marketed as described above – by an unsolicited telephone call with a general sales pitch which drew no particular attention to the nature of the day cap, and after the consumer’s details were obtained, a description of the contract with no focus on the day cap and in particular without explaining the potential vulnerability of a customer to incur very significant charges beyond the monthly fee by normal usage of the phone. One may ask rhetorically whether the consumer would have been interested if they had been told that everyday normal usage of the mobile phone under the plan was likely to increase the monthly charges quite significantly.
177 In circumstances where there was no real opportunity for reflection on the part of the consumers (even assuming the sales presentation script was adhered to, and consumers’ real responses were recorded – as to which, see the Postscript to these reasons for judgment), the oral contract was entered into on the one telephone contact involving the promotional method and the elements I have referred to above. I consider it was clearly unfair.
178 It was unfair to such a degree as to attract a strong adverse moral judgment: cf Australian Securities and Investment Commission v National Exchange Pty Ltd (2005) 148 FCR 132. In reality, upon analysis, except in the case of some limited users of mobile phone services, the Excite Mobile plan was destined to expose its consumers to quite substantial monthly charges but was presented in such a way that it effectively concealed that reality: cf Australian Competition and Consumer Commission v Allphones Retail Pty Ltd (No 2)  FCA 17, and it did so when Excite Mobile knew that its plan was not suited to the requirements of the everyday user. Although I accept that neither Mr Brown nor Mr Samuel set out deliberately to be unfair or to be unconscionable, in my view, its marketing approach judged objectively was cynically indifferent to the interests of its potential customers, and was unconscionable for the reasons given.
179 In addition, there are certain further elements of the contract which, in my view, fortify that conclusion and add to the assessment of its unconscionability. They include the cooling off fee of $75. It is not a fee which bears any relationship to real direct costs, at least on the evidence. It is a designated fee which would operate as a disincentive to a consumer to choose to “cool off” or to cancel the oral contract upon receipt of the phone package. Mr Brown accepted in his written submissions that the cooling off fee was unconscionable, as did Mr Samuel. That is also accompanied by the fee of $195 if a mobile phone (including any aspect of the packaging) was damaged. By opening the package containing the phone, the damage fee became payable. Indeed, I think that both those elements of the contract were in any event unconscionable. To state the circumstances in which that liability would arise if the phone was returned (even if, for example, there was no coverage) is enough to indicate why that conclusion is reached. On the limited evidence on the topic, that damage fee was about double the cost to Mobile Excite of the phone itself. Again, it is hard to resist the finding that it was to operate as a disincentive to “cooling off”. In any event, it is an additional feature which supports the conclusion that the marketing and sale of the Excite Mobile package was unconscionable.
180 I do not consider that the direct debit element of the oral contract is itself unconscionable, or adds to the information supporting the conclusion of unconscionability. The evidence does not show that the potential consumers were, or included, a category of persons who might not understand the nature of a direct debit or how it might operate. What they may not have understood was the extent of their potential liability under the contract, but that is a factor I have already taken into account.
181 I have considered separately the potentially relevant indicia of unconscionability referred to in s 51AB(2) of the TPA. They are neither exhaustive, nor necessary, indicia. There is a temptation to substitute for the words of the provision itself other epithets or expressions to give elucidation or substance to its meaning. That is discussed in the cases referred to at - above. The overall conclusion I have reached, in the light of those references, is that the sales method of Excite Mobile was, in all the circumstances, unconscionable for the reasons I have given. That conduct, on the evidence, took place from about 24 December 2008 although mainly from about 1 April 2009 to about 4 November 2010.
182 I accept that, so far as Excite Mobile (and Mr Brown and Mr Samuel) developed and presented the sales process, it was not part of the process that the telemarketers should speak so quickly as to be hard to understand, but they were to adhere to the script provided so the starting focus was the sales pitch with the giveaways, and there was no real focus on, or explanation of, the principal unusual features of the proposed sales contract.
183 In reaching that view, I have also taken into account the fact of, and the contents of, the Welcome to Excite Mobile letter. It was received by each person who had orally contracted with Excite Mobile. It is correct that it explains in a little detail the nature and operation of the day cap, although not in a way which – to an uninformed user of the services – would clearly indicate how easily the day cap is reached and the costs of more extensive use of the services. It does not indicate how readily the day cap is reached, or the rates then charged for usage of services above the day cap. By asterisk it refers to standard charges, which in turn refers to the “Applicable Fees & Charges” in small print, which in turn refers to the “website” for national and mobile charges. It does not provide any basis for knowing how the $2.20 day cap might be reached or the rate at which calls outside the day cap are charged, although it specifies SMS and MMS rates. More fundamentally, it does not change the nature of the conduct which led to the contract. And a consumer, upon receiving and reading the Welcome to Excite Mobile letter, would then probably be confronted with the choice – which I have found itself to be unconscionable – of electing to terminate the contract during the “cooling off” period by payment of $260 in the circumstances referred to above.
184 The coverage representations were clearly made to the 17 customers identified. I find that in each of those 17 cases they amounted to representations that there was mobile coverage at each of the customers’ home addresses through the Optus network. The evidence from the Optus representatives shows that in 16 of those instances there was no coverage through the Optus network, and in one instance such coverage was available only if the customer installed an external antenna. There was no “partial” classification. The means by which Excite Mobile could check if Optus coverage was available were readily sourced.
185 The representations were not correct. They were misleading and deceptive, and were likely to mislead and deceive, contrary to ss 52 and 53(c) of the TPA: see Australian Competition and Consumer Commission v Telstra Corporation Ltd  FCA 1904.
186 The TIC representations, as alleged, were also clearly made. There is nothing sinister about Excite Mobile endeavouring to address its customer complaints efficiently or directly. As Mr Brown said, it incurred not insignificant costs whenever a customer made a complaint to the Telecommunications Industry Ombudsman, and Excite Mobile had to respond through the Ombudsman.
187 But the conduct of Excite Mobile in endeavouring to address directly the complaints of its customers nevertheless involved Excite Mobile in making the representations by use of the TIC name and separate telephone number that TIC was a complaints handling organisation for consumers of telecommunications services, and that it was independent of Excite Mobile.
188 Neither of those representations was correct. The name TIC was registered and owned and used by Excite Mobile, and calls to TIC were answered by persons acting on behalf of Excite Mobile. Indeed, the evidence indicates that some consumers were deliberately misled by being told that TIC was independent of Excite Mobile or by the pretence that TIC did not have direct access to Excite Mobile’s records.
189 Consequently, I find that Excite Mobile in the respects pleaded in relation to TIC engaged in misleading and deceptive conduct and in conduct that was likely to mislead and deceive, contrary to ss 52 and 53(g) of the TPA.
190 Neither Mr Brown nor Mr Samuel really tried to resist those findings, although Mr Brown gave that conduct the context referred to in  above.
191 As to the allegations concerning debt collection by Excite Mobile, Mr Brown also put that conduct into some context. By 2010, Excite Mobile had unpaid accounts (on its calculations) exceeding $1,000,000. It may be observed, in view of the findings about the circumstances in which Excite Mobile procured contracts, that it is not surprising that many consumers did not expect the cost of their telephony services to be anywhere near as high as they were, and/or could not pay the fees which they were charged, and/or were reluctant to do so (with or without the default monthly accumulation on outstanding fees for telephony services described above), or a combination of one or more of those factors. The evidence also suggests that, to that time, attempts to recover outstanding or allegedly outstanding contract fees and charges had largely been unsuccessful.
192 Mr Brown agreed that, in that context, he decided that some more forceful recovery processes were required. (I shall address Mr Samuel’s role when considering his personal liability.)
193 Hence, Excite Mobile devised the six Jerry Hastings letters referred to above.
194 I find that each of the Jerry Hastings letters represented that:
(a) Jerry Hastings was an independent debt collector, or an agent of an independent debt collector; and
(b) the debt which Excite Mobile claimed to be owed to it by the particular customer had been referred to Jerry Hastings for collection.
195 In relation to the Times are Bad Letter, Excite Mobile also represented that unless the customer telephoned the Jerry Hastings number and an agreement was entered into to pay the alleged debt, Jerry Hastings would go to court to recover the debt allegedly owed to Excite Mobile by the customer, and if he did, the court would make orders:
(i) requiring the customer to pay an additional charge equal to 20% of the customer’s alleged debt for failing to pay on time; and
(ii) to repossess all assets of value owned by the customer, including children’s toys.
196 In relation to the Last Warning Letter, it also represented that Jerry Hastings intended to institute proceedings against the addressee of the letter unless the addressee called the Jerry Hastings number and entered into a payment plan.
197 The Failure to Pay Letter was sent to customers who had entered into a payment plan as a consequence of calling the Jerry Hastings number and in response to the previous letters sent, but then failed to meet that payment plan.
198 The Failure to Pay Letter contained a representation that unless the customer paid the agreed amount, Jerry Hastings would go to Court to recover the debt allegedly owed to Excite Mobile by the customer and, if he did, the Court would make orders requiring the customer to pay an additional charge equal to 20% of the customer’s alleged debt for failing to pay on time.
199 The evidence shows that Jerry Hastings was a fictitious character and the lawyer referred to in the Times are Bad Letter was a fictitious character. The letters were not from a debt collector or a representative of a debt collector but were created and sent by Excite Mobile. The debt allegedly due to Excite Mobile from the customer had not been referred to a debt collector or a lawyer.
200 In addition, if legal proceedings were taken in respect of the alleged debt, Excite Mobile would not have routinely had an entitlement to obtain orders for repossession of the customer’s assets, nor all assets of value, nor children’s toys; and would not have been able to get an order requiring the customer to pay an additional charge equal to 20% of the customer’s alleged debt for failing to pay on time.
201 The ACCC submitted that, at the time of sending the letters, Excite Mobile had no intention of instituting legal proceedings against the customer in respect of the alleged debt. I do not make that finding. It is not clear whether Excite Mobile would have brought proceedings as threatened. The event which brought the sending of the Jerry Hastings letters to an end, in about June or July 2010, was the involvement of the ACCC, and Mr Brown’s perception about that time that the ACCC did not regard those letters in their respective terms as entirely appropriate. Whether there would have been court proceedings in the absence of any ACCC investigation is unclear.
202 I have made the finding that Jerry Hastings was a fictitious character. It may be, as Mr Brown and Mr Samuel said, that there was an Indian person who was an employee of Lime India by the name of Mayank Punia, and that he was a former debt collector. It may also be, as they said, that he used the Anglo-Saxon name Jerry Hastings. On the evidence, he had no role or responsibility in developing the text of the Jerry Hastings letters, deciding when to send any of them, or dealing with the responses to them (a role largely played by Ms Smart), or more widely in the debt collection strategies of Excite Mobile either generally or in using that name. The fact that Excite Mobile may have been prompted by his name and his past employment to use the name Jerry Hastings does not, in the circumstances, support the proposition that he was the Jerry Hastings on that correspondence or that the person who dealt with responses to that correspondence did so on his behalf. “Jerry Hastings” as used by Excite Mobile is, I find, a fictitious character and one created to be seen as separate from Excite Mobile. As the ACCC put its submissions: the Jerry Hastings represented in the Jerry Hastings letters was a fictitious character.
203 Accordingly, I conclude that by creating and sending the Jerry Hastings letters, Excite Mobile engaged in conduct which was misleading, deceptive and likely to mislead and deceive, and made false and misleading representations as to the existence or effect of rights which Excite Mobile, Jerry Hastings and his lawyer had, and as to the existence or effect of remedies available to Excite Mobile, Jerry Hastings and his lawyers, in contravention of ss 52 and 53(g) of the TPA.
204 As noted above, the evidence shows that between 11 January 2010 and about the end of June 2010, after receiving one of the Jerry Hastings letters referred to above, a number of Excite Mobile customers telephoned the Jerry Hastings number. Those phone calls were either answered by, or responded to with a return call made by, primarily Ms Smart, but also Mr Brown. In such phone calls, both Ms Smart and Mr Brown represented to customers that they were from Jerry Hastings’ office; that Jerry Hastings’ office was a debt collector acting for Excite Mobile; and that Jerry Hastings’ office had no connection to, or was independent of, Excite Mobile. There are a number of recordings to support those findings.
205 As I have found, those representations were false and misleading, as Jerry Hastings was a fictitious character; Ms Smart and Mr Brown were acting for or on behalf of Excite Mobile; and neither Ms Smart nor Mr Brown represented a debt collector.
206 By making the representations in the Jerry Hastings calls, Excite Mobile engaged in conduct that was misleading, deceptive and likely to mislead and deceive, contrary to s 52 of the TPA.
207 I have found that Excite Mobile created a fictitious debt collector called Jerry Hastings so that the customers who received the Jerry Hastings letters and took part in the Jerry Hastings calls would form the belief that they were dealing with a debt collector; and that if they did not agree to pay a sum in satisfaction of the alleged debt, they would be taken to court and have judgment entered against them which would require them to pay an additional charge equal to 20% of the alleged debt and be subject to an order for repossession of their assets in satisfaction of the debt.
208 In the circumstances, I accept the contention of the ACCC that by the conduct referred to above, Excite Mobile used undue coercion, in connection with the payment for mobile telecommunications services by customers, in contravention of s 60 of the TPA.
209 As I noted above, I would make the finding whether the relevant concept is “undue coercion” or simply “coercion”. The correct approach depends upon whether “coercion” is used in a practical sense simply of describing the application of some pressure (in which case it might accommodate conduct which s 60 would not proscribe unless it was undue) or in a slightly more refined sense of applying unacceptable (or undue) pressure. I propose to adopt the measure of coercion used in both the cases referred to at  and  above, and so requiring something significantly beyond legitimate and reasonable demands.
210 In this matter, the combination of the presented independence of Jerry Hastings, and the descriptions of the nature of his lawyer, and the nature of the consequences which would follow if no agreement was come to (which were clearly overstated and false in the manner referred to) was such as to intimidate all but the well informed or well experienced debtor into responding to them. The greater the knowledge discrepancy between Excite Mobile on the one hand and the experience and knowledge of the customer on the other, the greater the likelihood of securing some agreement by intimidation. Indeed, that is what the Jerry Hastings letters were intended to achieve, by making threats ostensibly by an independent experienced debt collector, which could not be or were not likely to be the outcome of court proceedings as threatened. The conduct went well beyond legitimate and reasonable behaviour to recover debts.
211 Was the same conduct unconscionable contrary to s 51AB of the TPA, as the ACCC additionally and alternatively contended?
212 It must first be noted, as Mr Brown pointed out, that any creditor may claim payment from a debtor, and may threaten to bring proceedings to recover the debt if the debtor either does not pay it or makes arrangements with the creditor about its payment. The creditor may do so directly, or through a debt collector.
213 However, the present circumstances go well beyond that. As I have found, Excite Mobile engaged in the Jerry Hastings conduct for the purpose of creating a state of mind in the addressee of the letters, and the parties to the telephone calls, that the consequences of non-payment were quite dire, because an independent debt collector had been appointed to recover the debt; if a payment plan was not entered into, court proceedings would be instituted and repossession of assets, including very personal assets, would occur as a result; that court proceedings would inevitably result in the monies being owed by reason of the fact that the debt collector used a highly skilled and persuasive lawyer; and that when court proceedings were brought, in addition to the debt claimed in the Jerry Hastings letters, a charge equal to 20% of the customer’s alleged debt for failing to pay on time would be payable together with additional legal costs and charges.
214 I do not accept that the circumstances in which Excite Mobile came to contract with its customers should colour or inform the immediate issue. I have made separate findings about that. I regard its process of debt collecting, and in particular its conduct by using the Jerry Hastings persona and the Jerry Hastings letters in the way it did, as a matter to be separately assessed.
215 It is clear that debt collection processes, including the threat of proceedings, are not of themselves unconscionable. Nor are such processes unconscionable when carried out by a debt collector. I am not therefore minded to conclude that the “impersonation” by Excite Mobile as an independent debt collector is itself unconscionable. It may be that such conduct presents to the customer/debtor that the creditor has a serious intention to take court action to recover the debt, and that the creditor has taken the step of engaging a debt collector for that purpose. But the creditor is entitled to act on its own behalf, or to engage a debt collector, so creating the impression of a serious intention to take court action – however that is created – is not unconscionable (at least in the context of not being persuaded that Excite Mobile had no such intention).
216 Consequently, for the purposes of measuring this conduct of Excite Mobile against the concept of unconscionable conduct in s 51AB of the TPA, it is the content of the Jerry Hastings letters – in particular the threatened consequences of not making an arrangement for payment – which is criticised.
217 In my view, two elements of that content lead to the conclusion that the conduct was unconscionable. That content is first, the false assertion that a Court would make an order imposing, in essence, an extra charge of 20% of the outstanding debt for late payment, and secondly, that a Court would make a repossession order of all assets of the debtor, including personal assets such as children’s toys. Those matters are not correct. Although a Court may award interest on an unpaid debt according to the terms of the contract, it would not impose a 20% extra charge or payment absent such a contractual term and it would not routinely order repossession of all assets of a debtor including personal assets. In the context of a commercial enterprise such as Excite Mobile dealing with small, and no doubt in many instances uninformed, customers who might know no better, I regard those two threats as clearly unfair and unreasonable. They fall within the range of conduct which attracts a pejorative moral judgment.
218 I am satisfied in all the circumstances, that the Times are Bad Letter, the Last Warning Letter, and the Failure to Pay Letter, where they were sent (either one or more of them), amounted to unconscionable conduct on the part of Excite Mobile contrary to s 51AB of the TPA.
219 As noted above, Mr Brown did not dispute that, to the extent to which I found Excite Mobile by its impugned conduct had contravened the TPA, he was directly or indirectly knowingly concerned in those contraventions and was involved in them.
220 That was an appropriate position to adopt.
221 Mr Brown and Mr Samuel incorporated Excite Mobile as co-directors and equal shareholders. Mr Brown was at all material times responsible for the operations of Excite Mobile, including the establishment of Excite Mobile’s business operations; drafting the content for and authorising the use of the scripts used by the telemarketers on behalf of Excite Mobile; designing the method by which Excite Mobile promoted and supplied mobile telecommunications services to customers in Australia; authorising the terms of the mobile contracts, including the $33 month plan with a $2.20 day cap, drafting the content of, signing and authorising the use of the Jerry Hastings letters; making the representations to customers made in the Jerry Hastings calls, or directing that such representations be made; and deciding to set up the TIC number to direct all Excite Mobile’s customer complaints to this number and thereby directing calls away from being made directly to the TIO.
222 Mr Brown therefore had knowledge of the sales method and tactics used by Excite Mobile and the operation of the terms and conditions of Excite Mobile’s mobile contracts, including the day caps. He also knew that TIC was not a complaints organisation independent of Excite Mobile, and that calls made to the TIC number were answered by representatives of Excite Mobile. He also knew of the content of the Jerry Hastings letters and that they were being sent to Excite Mobile customers; that customers that telephoned the number listed in the Jerry Hastings letters were connected to an Excite Mobile telephone service and that he and Ms Smart then contacted the customers; that Jerry Hastings was not an independent debt collector; that the description of the lawyer in the Jerry Hastings letters was false as Excite Mobile did not have a lawyer at that time; and that the description of repossession of personal household items owned by the customer, such as children’s toys, in the Jerry Hastings letters, was unfounded and based merely on rumours of other lawyers recovering debts. And finally, he knew that Excite Mobile guaranteed mobile coverage and that coverage was restricted to coverage by the Optus mobile telecommunications network; and that Excite Mobile entered contracts with customers who resided in areas where there was no coverage by the Optus telecommunications network.
223 Consequently, to the extent to which I have found Excite Mobile to have contravened ss 51AB, 52, 53(c), 53(g) and 60 of the TPA, I conclude that Mr Brown was involved in and knowingly concerned in those contraventions.
224 The position of Mr Samuel is a more complex one. He did not accept accessorial liability for any of the contravening conduct except to the extent that, in his capacity as one of its directors, he was so liable. Moreover, there are factual issues about the extent to which he was – either as a director, or a working director, or in some other capacity – aware of and involved in what Excite Mobile was doing. I have noted above my caution about accepting his evidence that he was as distant from its day-to-day activities as he claimed.
225 The starting point is to note his claim that Mr Brown had primary responsibility for the Excite Mobile business and Mr Samuel had primary responsibility for the Lime Australia business. I accept that that was the general arrangement between them, but it does not expose in any real way the extent of Mr Samuel’s involvement in the Excite Mobile business.
226 I find that Mr Samuel, together with Mr Brown, was directly involved in the development of Excite Mobile’s marketing model, and the detail of its proposed contractual terms. That finding, more explicitly, means that Mr Samuel was an active participant in developing the day cap plan proposal, and was aware of its details and how it would work and how it was explained, and in addition he was aware that the proposed contracts included a $75 cooling off fee and a $195 return fee and he was aware of how those fees became payable and the rough cost to Excite Mobile of a phone. He did not draft, but he approved, the sales script in advance of its use. For the reasons given earlier, I prefer the evidence of Mr Brown to that of Mr Samuel on these topics. Ultimately, in his evidence he acknowledged that he may have “skim read” that script, but I am satisfied he did more than that.
227 Those are the critical elements of the conduct of Excite Mobile which have led me to conclude that its conduct in its sales process was unconscionable. Mr Samuel’s level of involvement means that he had knowledge of, and supported, the essential elements of Excite Mobile’s contravention of s 51AB in its sales process: cf Yorke v Lucas (1985) 158 CLR 661 at 670; Rural Press Ltd v Australian Competition and Consumer Commission (2003) 216 CLR 53 at ; and Medical Benefits Fund of Australia Ltd v Cassidy (2003) 135 FCR 1 at  and .
228 I therefore conclude that Mr Samuel was involved in that contravention of s 51AB of the TPA.
229 In relation to the coverage representations, Mr Samuel in his s 155 examination said that the plan was to contract only those consumers who were within an Optus coverage area. According to that evidence, it was then the task or responsibility of Mr Brown to “wash through” the contact lists to exclude non-Optus postcodes. It is unclear on the evidence whether the “wash through” was not done well, or not done at all. The evidence from the Optus officers confirms that it provided the details of the postcode areas where it did not provide coverage.
230 I am not satisfied, in the circumstances, that Mr Samuel knew, or closed his mind to knowing, whether consumers in non-Optus postcode areas remained on the contact lists: cf King v GIO Australia Holdings Ltd  FCA 308 at . Nor is there any basis for concluding that he was aware that any of the telemarketers simply ignored the expressed concerns of a particular potential customer about coverage.
231 Accordingly, I do not find that Mr Samuel has accessorial liability in respect of those representations or for Excite Mobile’s contraventions of ss 52 and 53(c) in that respect.
232 There is, on the other hand, quite clear evidence that Mr Brown shared with Mr Samuel his concern about the level of complaints made by customers to the Telecommunications Industry Ombudsman, and the cost to Excite Mobile of addressing them. Although initially Mr Samuel professed little or no knowledge of the setting up of TIC or how it operated, his cross-examination and his s 155 examination and other evidence exposed that he in fact was aware of, and supported, the proposal to set it up and to give it the appearance of being independent of Excite Mobile, including in the Welcome to Excite Mobile letters. Some of that evidence is referred to above at -. I prefer Mr Brown’s evidence to that of Mr Samuel where there is conflict between them about the extent of Mr Samuel’s involvement and knowledge on this topic. As I indicated at  above, I am cautious about accepting Mr Samuel’s evidence, particularly his evidence in chief, where it is contradicted. I do not need to find (and I do not find) that he was deliberately misleading the Court. But I think that over time he has come to view his role in Excite Mobile as somewhat less than it was; contemporaneous email correspondence, amongst other things, tends to show that.
233 On the whole of the evidence which I have accepted, in my view Mr Samuel is accessorily liable for the contraventions of ss 52 and 53(g) of the TPA by Excite Mobile in this regard.
234 The role of Mr Samuel in relation to the Jerry Hastings letters, at least as acknowledged by him, is also a somewhat changing one: see reference to some of the evidence at - and .
235 Upon the whole of the evidence, I find that Mr Samuel was aware of, and supported, the use by Excite Mobile of the Jerry Hastings letters and the way in which responses to those letters were dealt with. His knowledge was not a remote and uninvolved one, but as one of the two directors was a positive and supportive one.
236 The course of the evidence exposed an email from Mr Samuel to Mr Brown clearly seeking detailed information about the success or otherwise of the debt collection process with, at least, one Jerry Hastings letter, and clearly demonstrating a preparedness himself to participate in the assessment of it. The response is in positive terms, proposing a “Full On Court looking letter that is the final freak out letter”. Whilst it is correct to say there is no documentary evidence specifically confirming that Mr Samuel approved of the precise terms of all the Jerry Hastings letters, his initial position in his affidavit removed him from a role in relation to them which is not consistent with that email exchange. I therefore prefer the evidence of Mr Brown about the extent of his involvement in, and knowledge of, the Jerry Hastings letters and what they were intended to achieve.
237 Consequently, I also conclude that Mr Samuel was an accessory (in the relevant sense) to the conduct of Excite Mobile which I have found contravened ss 51AB, 52, 53(g) and 60 of the TPA. In particular, I find he was aware of and supported the presentation of a fictitious debt collector with a fictitious lawyer, and with the two threats of consequences which led me to draw conclusions adverse to Excite Mobile.
238 In making those findings of accessorial liability on the part of Mr Samuel, it does not routinely follow that the extent of his involvement in the contraventions of Excite Mobile was the same as that of Mr Brown.
239 Obviously, that comment is also apt in the case of Ms Smart. She was a frank and, in my view, reliable witness.
240 I find that, although Ms Smart described herself as working for Mr Brown, she was aware that what she was doing was on behalf of Excite Mobile. She did not play a part in developing the strategy for Excite Mobile of debt collecting using the Jerry Hastings letters. Her role was confined to sending the series of Jerry Hastings letters as appropriate. She signed many of them using a “Jerry Hastings” signature. She knew that Jerry Hastings was a fictitious person, and that there was no specific lawyer referred to in the Times Are Bad letter. She knew that, in reality, that conduct was engaged in by Excite Mobile and not an independent debt collector. I accept that she made a few comments to Mr Brown about the content of the letters, but I do not consider that her comments indicate any real input into their contents.
241 It is not suggested in the written submission of the ACCC either initially or in reply that Ms Smart knew that the two particular features of the content of those letters – namely that a Court would impose a 20% penalty for late payment, and that a Court would make a repossession order of the customer’s assets, including personal assets such as children’s toys – were false.
242 Ms Smart also responded to telephone calls prompted by one or more of the Jerry Hastings letters. She did so in the name of Jerry Hastings, as an independent debt collector for Excite Mobile.
243 In my view, Ms Smart was thereby knowingly involved in the conduct of Excite Mobile contravening s 52 and 53(g) of the TPA so far as it represented falsely that Jerry Hastings was a debt collector, who engaged a lawyer with the traits described, and who was independent of Excite Mobile.
244 I was not asked to find, and I do not find, that she was involved as an accessory in making the two false representations referred to above about what a Court would do to enforce the alleged debt. It may be that the ACCC has taken the view that to that extent her role as described was no more than that of a conduit: cf Yorke v Lucas (1985) 158 CLR 661 at 665; Butcher v Lachlan Elder Realty Pty Ltd (2004) 218 CLR 592 at 605. That is certainly a position which could be taken on the evidence. There is obviously a line to be drawn as a matter of practical judgment. Not every employee of a corporation, big or small, who plays a part in sending out a letter which contains misleading content is thereby an accessory to the misleading conduct by the corporation.
245 Absent those two elements, which I considered to be significant in the conclusions that Excite Mobile had contravened ss 51AB and 60 of the TPA in relation to its debt collection processes using the Jerry Hastings letters, I do not find that Ms Smart was involved in or knowingly concerned in those contraventions.
246 As noted at  above, the parties are agreed that at present the findings I have made should not be converted into orders. That will follow in the light of my findings, after any further hearing proposed by the parties on what orders should be made.
247 I will simply adjourn the matter for further directions for a period of about 28 days (I will fix a date when these reasons for judgment are published). If the parties are not able to agree about how the matter should now proceed, I will allow each of the parties 21 days to make submissions in writing as to what direction should be given to complete the hearing of the matter.
248 I have referred above to the telemarketing actually carried out by Lime India on behalf of Excite Mobile. It is not part of the ACCC case to allege that the telemarketing departed from the script provided by Excite Mobile, but it clearly did. The first stage referred to at  was not routinely used in full, and in some instances the telemarketer was hard to understand.
249 It is clear that the individual telemarketers varied in the quality of their communications with consumers or potential consumers for the supply of the Excite Mobile product. In one instance, a telemarketer clearly simply did not listen to, or respond to the consumer. She simply ignored what the consumer said (or did not say), and treated whatever the consumer said (or did not say) as an agreement to what she asked: see at  and . That was highly improper.
250 Given the relatively small number of samples of the recorded telemarketing “pitch”, the samples played indicate to me that there is good reason to question the reliability of the record kept by a telemarketer of such services, at least through the staff of, or contractors to, Lime India.
251 It may be appropriate to consider whether, before a contract said to be entered into with or through a telemarketer such as Lime India may be enforced, the supplier should be required to give to the consumer the opportunity to listen to the recorded interview upon which the contract is said to arise.