Federal Court of Australia

Australian Communications and Media Authority v V Marketing Australia Pty Ltd (In Liq) (No 4) [2025] FCA 287

ORDERS

PENAL NOTICE

TO:    MICHAEL VAZQUEZ

IF YOU (BEING A PERSON BOUND BY THIS ORDER):

(A)    REFUSE OR NEGLECT TO DO ANY ACT WITHIN THE TIME SPECIFIED IN THIS ORDER FOR THE DOING OF THE ACT; OR

(B)    DISOBEY THE ORDER BY DOING AN ACT WHICH THE ORDER REQUIRES YOU NOT TO DO,

YOU WILL BE LIABLE TO IMPRISONMENT, SEQUESTRATION OF PROPERTY OR OTHER PUNISHMENT.

ANY OTHER PERSON WHO KNOWS OF THIS ORDER AND DOES ANYTHING WHICH HELPS OR PERMITS YOU TO BREACH THE TERMS OF THIS ORDER MAY BE SIMILARLY PUNISHED.

THE COURT ORDERS THAT:

First Respondent – V Marketing

1.    Pursuant to s 601AH(2) of the Corporations Act 2001 (Cth), the Australian Securities and Investments Commission (ASIC) reinstate the registration of the hitherto first respondent, V Marketing Australia Pty Ltd (ACN 160123491) (V Marketing), which was, prior to its deregistration, on 27 September 2024, in liquidation.

2.    Mr Brent Kijurina be appointed as liquidator of V Marketing.

3.    The reasonable costs of the liquidator in undertaking the liquidation be borne by the Applicants, the Australian Communications and Media Authority (the ACMA) and not form part of the ACMA’s costs in these proceedings.

4.    The restoration of V Marketing to the register take effect for all purposes related to these proceedings, nunc pro tunc on and from 27 September 2024 to the end that V Marketing be taken continuously to be first respondent.

5.    For the avoidance of any doubt, the following orders made by the Court on 22 April 2020 continue to have effect, uninterrupted by the deregistration of V Marketing:

(a)    the leave to proceed, pursuant to s 500(2) of the Corporations Act against V Marketing in respect of the Originating Application filed 10 April 2019 granted to the ACMA;

(b)    the leave to proceed against the first respondent granted to other respondents;

(c)    All such leave to proceed hitherto ordered remain on the following terms:

(i)    The ACMA discontinues its claim in paragraph 11 in the Originating Application; and

(ii)    The ACMA may not seek to enforce any pecuniary penalty awarded in its favour against V Marketing pursuant to the Originating Application, in the winding up of the V Marketing or otherwise, without leave of the Court.

(iii)    The second respondent, Balaska Pty Ltd (Balaska) and the fourth respondent, James Matthew McLennan (Mr McLennan) may not seek to enforce any judgment awarded in their favour against the V Marketing pursuant to the Cross-Claim in the winding up of V Marketing or otherwise, without leave of the Court.

(iv)    V Marketing remain:

(a)    excused from further participation in the proceeding; and

(b)    subject to its submission to the making of all orders sought, and the giving or entry of judgment in respect of all claims made, by the Originating Application and Cross-Claim, save as to costs.

6.    There be no order as to costs in respect of the interlocutory application by the ACMA for the reinstatement to the register of V Marketing.

Contravening conduct by V Marketing

7.    IT BE DECLARED THAT:

(a)    V Marketing made telemarketing calls to numbers on the Register maintained for the purposes of the Do Not Call Register Act 2006 (Cth) (DNCR Act) on 89 days during the period 1 March 2017 to 30 June 2017; 66 days during the period 1 July to 30 September 2017; and 140 days during the period from then until 27 September 2018.

(b)    In so doing and on each of those 89, 66 and 140 days respectively, V Marketing thereby contravened s 11(1) of the DNCR Act.

(c)    During the period from 1 March 2017 to 30 September 2017, the calls made by V Marketing and referred to in paragraph 7(a) were made exclusively on behalf Balaska in respect of Balaska’s solar energy systems (Balaska telemarketing calls).

(d)    From mid November 2017 onward, the calls made by V Marketing and referred to in paragraph 7(a) were made only in respect of its own solar energy systems, known as Your Choice Solar (Your Choice Solar telemarketing calls).

Penalties – V Marketing

8.    In respect of the contraventions of s 11(1) of the DNCR Act constituted by the Balaska telemarketing calls, a single civil pecuniary penalty in the amount of $750,000 be imposed on V Marketing.

9.    In respect of the contraventions of s 11(1) of the DNCR Act constituted by the Your Choice Solar telemarketing calls, a single civil pecuniary penalty in the amount of $750,000 be imposed on V Marketing.

10.    The civil pecuniary penalties in the total amount of $1,500,000 so imposed constitute a debt payable to the Commonwealth of Australia but the enforcement of that debt by the Commonwealth be subject to the terms of this Order.

Contravening conduct by Balaska

11.    IT BE DECLARED THAT:

(a)    On or about 2 April 2013, V Marketing entered into a contract, arrangement, or understanding with Balaska to carry on telemarketing activity, including by making telemarketing calls, on behalf of Balaska (V Marketing Agreement).

(b)    During the period 1 March 2017 to 30 September 2017 (the Relevant Period), V Marketing gave effect to the V Marketing Agreement by making 553,630 telemarketing calls to numbers on the Register (Relevant Contravening Calls).

(c)    Each of the Relevant Contravening Calls was a “telemarketing call” for the purpose of the DNCR Act and was not a “designated telemarketing call” for the purposes of s 11(1) of the DNCR Act.

(d)    In these circumstances, by the operation of s 11(9) of the DNCR Act, Balaska caused V Marketing to make the Relevant Contravening Calls.

(e)    In respect of the making of each of the Relevant Contravening Calls and by virtue of “causing” V Marketing to make the Relevant Contravening Calls during the Relevant Period, Balaska thereby contravened s 11(1) of the DNCR Act.

12.    Having regard to the observations made by the Court in Australian Communications and Media Authority v V Marketing Australia Pty Ltd (in liq) (No 2) [2024] FCA 34 (Thomas J) as to the reasonableness of the conduct of Balaska’s sole director and directing mind and will, Mr McLennan, and the Court’s conclusion in that case that McLennan did not have actual knowledge of the elements of the contraventions of the DNCR Act by Balaska, no civil pecuniary penalty be imposed on Balaska.

13.    Save as aforesaid, the claims for relief made by the ACMA against Balaska be dismissed.

Contravening Conduct by Mr Michael Vazquez

14.    IT BE DECLARED THAT:

(a)    During the whole of the period from 1 March 2017 to 27 September 2018, Mr Vazquez:

(i)    was the sole director of the V Marketing and its directing mind and will;

(ii)    directed or authorised V Marketing to make, attempt to make or cause to be made each of the Balaska telemarketing calls and the Your Choice Solar telemarketing calls, to Australian numbers that were registered on the Register; and

(iii)    knew that V Marketing did not have in place systems that were reasonably adequate for ensuring that it did not make, attempt to make or cause to be made, telemarketing calls to Australian numbers that were registered on the Do Not Call Register.

(b)    During the period from 1 March 2017 to 30 September 2017, Mr Vazquez was thereby knowingly concerned in the making of each of the Balaska telemarketing calls, each call made by V Marketing to numbers on the Register in contravention of s 11(1) of the DCNR Act, a total of 553,630 telemarketing calls.

(c)    During the period from 1 February 2018 to 27 September 2018, Mr Vazquez was thereby knowingly concerned in the making of each of the Your Choice Solar telemarketing calls, each call made by V Marketing to numbers on the Register in contravention of s 11(1) of the DCNR Act, a total of 548,688 telemarketing calls.

(d)    By virtue of his being so knowingly concerned in relation to the making of each of the Balaska telemarketing calls and each of the Your Choice Solar telemarketing calls Mr Vazquez, in respect of each of those calls, committed an ancillary contravention of the DNCR Act for the purposes of s 11(7) of that Act (the ancillary contraventions).

15.    Noting an agreement as to penalty as between the ACMA and Mr Vaquez that a single penalty in the amount of $60,000 was agreed in respect of the ancillary contraventions, and considering that it is appropriate in the circumstances of this case to impose on Mr Vazquez a single penalty in that amount, a single, civil pecuniary penalty in the amount of $60,000 be imposed on Mr Vazquez.

16.    The civil pecuniary penalty in the amount of $60,000 so imposed constitute a debt payable to the Commonwealth of Australia.

Injunctions – Mr Vazquez

17.    For the period of 5 years from the date of this Order or further earlier orders, and in the event that Mr Vazquez proposes to engage in any business activity involving making or causing to be made an unsolicited telephone voice call that directly or indirectly advertises, promotes or offers the supply of goods or services, Mr Vazquez must:

(a)    give 14 days’ notice in writing to the ACMA:

(i)    of his proposal to engage in such conduct; and

(ii)    of these orders; and

(b)    provide to the ACMA such information as it reasonably requires that is incidental to its enforcement functions and powers under the Australian Communications and Media Authority Act 2005 (Cth) and which is requested within 7 days of it being informed of the proposed conduct.

Costs

Mr Vazquez

18.    Within 3 months of this Order, Mr Vazquez pay the ACMA’s the amount of $10,000, referable to the ACMA’s costs of, and incidental to these proceedings.

19.    Providing the sum of $10,000 be so paid (or within such extended period as the ACMA may in writing agree), that sum stand as against Mr Vazquez as the amount of the ACMA’s costs of and incidental to these proceedings.

20.    If the sum not be so paid by Mr Vazquez, the ACMA be at liberty to apply for an order against Mr Vazquez in respect of its costs as against him of and incidental to these proceedings.

Balaska

21.    The question of costs in respect of the proceeding against Balaska be reserved.

V Marketing

22.    The ACMA bear its own costs insofar as they relate to proceedings against V Marketing.

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

REASONS FOR JUDGMENT

LOGAN J:

1    Ordinary experience of life instructs that the experience of unsolicited, hard copy marketing and other material, colloquially referred to as “junk mail”, crowding out a letterbox or littering the entry path to a front door is not uncommon. In many ways, that experience is an experience of the “Analog Age”. So, the frequency or severity of its encounter is, in the “Digital Age”, diminishing. Nonetheless, it can be a nuisance. Often, that nuisance can at least be much reduced by the straightforward expedient of affixing to that letterbox a sign which states “No Junk Mail” or perhaps “Australia Post Mail Only”.

2    That same experience of life instructs that, ever increasingly in the Digital Age, unsolicited marketing and a related nuisance are not confined to deliveries to a letterbox. Another method of unsolicited marketing is by telephone via what is termed “telemarketing” or sometimes “cold calling”. In the Digital Age, via automated dialling and the deployment of artificial intelligence software, telemarketing has never been easier. The Digital Age also offers some individual telephone number holders a means of filtering these via selective number blocking but only after the experience of an unsolicited telemarketing call from a particular number. Left to an individual’s own resources, blocking a particular number in advance of the receipt from its user of an unsolicited telemarketing call can be difficult, if not impossible. Without more, a perpetual and vexing burden of catch-up lies in prospect for an individual in relation to unsolicited marketing by telephone.

3    Recognising this, parliament enacted in 2006 the Do Not Call Register Act 2006 (Cth) (DNCR Act). The DNCR Act provides for the establishment of a register, kept in electronic form by or on behalf of the applicant, the Australian Communications and Media Authority (ACMA) and known as the “Do Not Call Register” (the Register): s 13. Under the DNCR Act (s 15) the account holder (or that person’s nominee) of an Australian number (defined by s 14 of the DNCR Act) may apply to the ACMA for that number to be entered on the Register. The DNCR Act then prohibits the making of unsolicited telemarketing calls (s 11) or the sending of unsolicited marketing facsimiles (s 12B) to a number registered on the Register. Contravention of that prohibition is sought to be deterred by provision for the imposition of civil penalties for such contraventions (s 24) and the conferring on this Court of a power to grant injunctive, including interim injunctive, relief (s 34 and s 35 respectively).

4    The DNCR Act also makes provision for ancillary orders to be made for compensation and for the recovery of a financial benefit obtained as a result of a contravention of the Act: s 30 and s 31 respectively.

5     Jurisdiction is conferred concurrently on this Court and the Federal Family and Circuit Court of Australia (Division 2) in respect of proceedings under the DNCR Act for civil penalties, injunctions and ancillary relief.

6    By these proceedings, the ACMA invoked this jurisdiction for the purpose of seeking declaratory relief in respect of alleged contraventions of the DNCR Act and the imposition of civil penalties in respect of such contraventions as were found proved.

V Marketing

7    The first respondent, V Marketing Australia Pty Ltd (ACN 160123491) (V Marketing) was registered on 29 August 2012. The company was under external administration from 20 August 2019 to 26 September 2024. It was deregistered, following the finalisation of the liquidation, on 27 September 2024.

8    A Mr Kijurina and a Mr Albarran were appointed as administrators of V Marketing on 20 August 2019. These same gentlemen were appointed as liquidators on 25 September 2019. They ceased their appointment as liquidators of V Marketing on 18 June 2024.

9    On 22 April 2020, on the application of the ACMA, the then docket judge, Collier J made orders by consent (April 2020 orders) to the effect that:

(a)    the ACMA had leave to proceed against V Marketing in respect of the Originating Application;

(b)    V Marketing was excused from further participation in the proceedings;

(c)    V Marketing submitted to the making of all orders sought, and the giving or entry of judgment in respect of all claims made by the Originating Application, save as to costs;

(d)    the ACMA discontinued its claim for injunctive relief against V Marketing;

(e)    the ACMA was precluded from seeking to enforce any pecuniary penalty awarded in its favour without the leave of the court.

10    The finalisation of V Marketing’s liquidation, supposedly on 29 September 2024, was revealed to the ACMA on 19 November 2024 upon the filing and service in these proceedings of an affidavit of the third respondent, Mr Michael Vazquez in which reference was made to this fact. The deregistration of V Marketing was confirmed by the ACMA upon a search of the records maintained by the Australian Securities and Investments Commission (ASIC) in respect of V Marketing. However, these records stated that deregistration occurred on 27, not 29, September 2024. I prefer to act on the ASIC record and find that deregistration occurred on 27 September 2024.

11    In circumstances where a company is in liquidation and this Court has nonetheless granted leave on terms to proceed against it in civil penalty proceedings, it is a prudent step for an applicant regulator such as the ACMA to conduct check searches of the ASIC record prior to significant court events. That did not occur here. But that is no reason not to restore V Marketing to the register, given that the Court was persuaded in 2020 to grant leave to proceed.

12    The ACMA applied, pursuant to s 601AH(2) of the Corporations Act 2001 (Cth), for the reinstatement of V Marketing’s registration.

13    In Commissioner of Taxation v International Indigenous Football Foundation Australia Pty Ltd (in liq) [2017] FCA 538 (ILFA Case), I heard and determined an application in another type of civil penalty proceeding for leave to proceed against a company in liquidation. I discussed in that case the pertinent authorities in relation to such applications. In my view, like considerations should inform whether to restore a company to the register. I therefore rely upon, without again rehearsing, that discussion. Suffice it to say, restoration to the register of a deregistered company for the purpose of penal proceedings, as I noted in the ILFA Case, in respect of the granting of leave to proceed, bears some resemblance to the exhumation in Post-Restoration England in the 17th century of the by then deceased Lord Protector Cromwell and other principal regicides, so they might be tried for treason. The ordering of the restoration to the register of a deregistered company can serve the public interest of deterrence in relation to norms of behaviour ordained by parliament, conformity with which is buttressed by a civil penalty regime. That public interest supports the restoration of V Marketing to the register for that purpose but on particular terms which include the meeting of the liquidator’s costs by the ACMA and a like restriction on the ability of the ACMA to enforce any penalty and otherwise on the terms of the order of 22 April 2020.

14    I note that Mr Kijurina has agreed to serve as liquidator of V Marketing for the purpose of enabling the conclusion of these proceedings against it.

Mr McLennan – once fourth respondent

15    One of the originally named respondents to these proceedings, the fourth respondent, Mr James Matthew McLennan, the sole director of the second respondent Balaska Pty Ltd (Balaska), was, as was his right, disposed to contest the allegations of accessorial liability in respect of contraventions of the DNCR Act made against him by the ACMA. The case against Mr McLennan was separately heard and determined by the by then docket judge, Thomas J (in succession to the original docket judge, Collier J). The balance of the proceedings was adjourned, pending the outcome of the proceedings against Mr McLennan.

16    On 24 January 2024, Thomas J determined that the proceedings against Mr McLennan should be dismissed: Australian Communications and Media Authority v V Marketing Australia Pty Ltd (in liq) (No 2) [2024] FCA 34 (ACMA v V Marketing (No 2)) In so doing, Thomas J made, at [98]-[99], these observations about Mr McLennan’s conduct:

98    Reasonable steps which might have been taken by someone in Mr McLennan’s position are determined by reference to the extent of the knowledge. By the end of the period of seven months, from Mr McLennan’s perspective, having received the compliance warnings, he was aware of seven telemarketing calls to three telephone numbers. On each occasion (except the second occasion, which Mr McLennan concedes was by virtue of an oversight) Mr McLennan forwarded the warning to V Marketing. The responses from V Marketing provided relevant information as to washing for the post codes and were relevant to the issue of knowledge.

99    Given the contents of the compliance warnings, the timing of the compliance warnings and the responses received from Mr McLennan, the action he took was reasonable and proportionate. There was no failure to take reasonable action.

Balaska – Second Respondent

17    In the aftermath of that judgment, Balaska sought further to amend its defence. By then, Thomas J had retired from the Court and I had succeeded his Honour as the docket judge for this proceeding. I dismissed Balaska’s amendment application: Australian Communications and Media Authority v V Marketing Australia Pty Ltd (in Liq) (No 3) [2024] FCA 817.

18    The case thereafter proceeded for hearing and determination of the ACMA’s case as against the remaining respondents.

19    The proceedings are civil in character, although findings of contraventions may have penal consequences for a respondent. The ACMA is obliged to prove its case on the balance of probabilities, albeit taking into account the nature and consequences if proved of the allegations: s 140(1) and s 140(2), Evidence Act 1995 (Cth) (Evidence Act).

20    As to the case against Balaska, the ACMA and Balaska came, on 23 August 2024, to file an agreed statement of facts. They are agreed that facts recited in this statement are not disputed for the purposes of s 191 of the Evidence Act. The effect of this statement is that, as against Balaska, ACMA is not required to lead evidence to prove the existence of an agreed fact: s 191(2)(a), Evidence Act.

21    Although, as against each of the remaining respondents, ACMA bears the onus of proof of the contraventions alleged, in discharging that onus of proof it is entitled, as against a particular respondent(s), to rely upon admissions made on the pleadings and in the agreed statement applicable to that respondent.

22    In combination, the agreed facts and the admissions on the pleadings establish the following against Balaska (adopting for this purpose, descriptions found in the agreed statement).

23    Balaska was, at all times material to these proceedings:

(a)    a body corporate incorporated in Australia with its principal place of business in Australia; and

(b)    carrying on a business involving, among other things, the sale, supply and installation of solar energy systems (Balaska Business).

24    Mr McLennan is, and was at all material times, the sole director of Balaska. He holds the position of General Manager of the Balaska Business and has, and had at all material times, responsibility for day-to-day management of the Balaska Business. Mr McLennan is thus the “directing mind and will” of Balaska. No-one else has that status in relation to Balaska.

25    During the period 1 March 2017 to 30 September 2017 (the Relevant Period) Balaska employed seven (7) employees. Balaska contracted with electricians and other individuals to install solar energy systems.

26    The Relevant Period spanned parts of two financial years:

(a)    In the financial year ending 30 June 2017, Balaska’s gross operating income was $13,409,971. Balaska had a net profit of $755,602.

(b)    In the financial year ending 30 June 2018, Balaska’s gross operating income was $6,513,737. Balaska had a net loss of $1,084,264.

27    In the financial year ending 30 June 2022, Balaska’s gross operating income was $2,997,604. Balaska had a net profit of $414,348.

28    In the financial year ending 30 June 2023, Balaska’s gross operating income was $1,197,290. Balaska had a net loss of $1,161,668. Balaska employed two (2) employees.

29    No more recent information concerning Balaska’s current financial position is admitted or otherwise in evidence.

30    On or about 2 April 2013, the first respondent, V Marketing entered into a contract, arrangement, or understanding with Balaska to carry on telemarketing activity, including by making telemarketing calls, on behalf of Balaska (V Marketing Agreement).

31    During the Relevant Period, V Marketing gave effect to the V Marketing Agreement by making 553,630 telemarketing calls to numbers on the Register (Relevant Contravening Calls). Each of the Relevant Contravening Calls was a “telemarketing call” for the purpose of the DNCR Act and was not a “designated telemarketing call” for the purposes of s 11(1) of the DNCR Act.

32    In these circumstances, by the operation of s 11(9) of the DNCR Act, Balaska caused V Marketing to make the Relevant Contravening Calls.

33    It is important to bear in mind what s 11(9) of the DNCR Act makes it necessary and sufficient to “cause” to be made, a telemarketing call to an Australian number for the purposes of s 11(1) of that Act:

(9)    For the purposes of this section, if:

(a)    a person (the first person ) enters into a contract or arrangement, or arrives at an understanding, with another person; and

…

(c)    the other person, or an employee or agent of the other person, gives effect to the contract, arrangement or understanding by making a telemarketing call;

the first person is taken to have caused the telemarketing call to be made.

34    By virtue of “causing” V Marketing to make the Relevant Contravening Calls during the Relevant Period, Balaska contravened s 11(1) of the DNCR Act. Balaska admitted these contraventions by its Amended Defence filed on 22 October 2021.

35    It was unnecessary for the ACMA to allege and prove any mental element in Balaska’s conduct. The contraventions were strict liability contraventions. As soon as events engaging s 11(9) were proved, the contraventions of s 11(1) were taken to have occurred.

36    Although not referred to in the agreed statement of facts, the evidence led by the ACMA establishes that, on each of 28 February 2017, 29 April 2017, 31 May 2017, 21 September 2017, 16 October 2017 and 16 November 2017, it gave a compliance warning to Balaska by email, informing Balaska of a complaint or complaints received by the ACMA that a telemarketing call or calls was or were made or caused to be made by Balaska to a number on the Register. The evidence further establishes that these warnings related to a total of 13 complaints.

37    Based on this, the ACMA submitted that Balaska was on notice from the receipt of the ACMA’s initial compliance warning on 28 February 2017 that V Marketing was or may have been calling numbers listed on the Register in contravention of s 11(1) of the DNCR Act. The ACMA further submitted that, despite this, Balaska failed to prevent the contraventions. The ACMA submitted that the continuation of the contravening conduct in the face of six compliance warnings from the ACMA over a period of approximately eight and half months is an aggravating factor in the Court’s consideration of the appropriate penalty.

38    Balaska, on the other hand, while it admitted in its Amended Defence the contraventions, pointed to the minimalist requirements of s 11(9) in relation to what is taken to be a contravention of s 11(1) and to the observations made by Thomas J, quoted above, as to the reasonableness of Mr McLennan’s conduct. Balaska also highlighted the dispositive conclusion by Thomas J in ACMA v V Marketing (No 2), at [93], that “… given the contents of the compliance warnings, the timing of the compliance warnings and the responses received from Mr McEvoy, Mr McLennan did not have actual knowledge of the elements of the contraventions”.

39    Reflecting these differences of emphasis, there was a sharp difference between the ACMA and Balaska as to what was the “appropriate” penalty to impose on Balaska.

40    Section 24(3) of the DNCR Act creates the following requirements in relation to the fixing of a civil penalty in respect of a contravention of the DNCR Act:

Determining pecuniary penalty

(3)    In determining the pecuniary penalty, the court must have regard to all relevant matters, including:

(a)    the nature and extent of the contravention; and

(b)    the nature and extent of any loss or damage suffered as a result of the contravention; and

(c)    the circumstances in which the contravention took place; and

(d)    whether the person has previously been found by a court in proceedings under this Act to have engaged in any similar conduct; and

(e)    if the court considers that it is appropriate to do so--whether the person has previously been found by a court in a foreign country to have engaged in any similar conduct.

41    Balaska has never previously been found in proceedings under the DNCR Act to have engaged in similar conduct. There is no suggestion that a foreign court has found it has engaged in similar conduct. There is no evidence that the contravening calls resulted in financial loss or damage to anyone.

42    These days it is an uncontroversial given that a civil penalty regime such as that found in the DNCR Act exists “primarily, if not solely, for the purpose of deterrence”: Australian Building and Construction Commissioner v Pattinson (2022) 274 CLR 450 (Pattinson), at [15] (Kiefel CJ, Gageler, Keane, Gordon, Steward and Gleeson JJ). Some might think that position was more than tolerably clear before Pattinson, but as the discussion in Pattinson illustrates, before that case differences had emerged in this Court on that subject. Given what was stated in Pattinson, it is unnecessary to rehearse these past differences of view. It is, however, desirable to recall a statement made by French J in Trade Practices Commission v CSR Ltd [1991] ATPR 41-076 (CSR), at 52,152, when a judge of this Court in in relation to the objective of fixing a penalty under a civil penalty regime namely, “ to attempt to put a price on contravention that is sufficiently high to deter repetition by the contravenor and by others who might be tempted to contravene the Act”. That statement was expressly approved in Pattinson, at [15], as it earlier had by the plurality in The Commonwealth v Director, Fair Work Building Industry Inspectorate (2015) 258 CLR 482 (Agreed Penalties Case), at 506 [55]. Put another way, a civil penalty should not be imposed at a level which makes it just another cost of doing business.

43    In CSR, at 52,152-52,153, French J also set out in a non-exhaustive way, factors which were pertinent to take into account in relation to the imposition of a civil penalty:

1.     The nature and extent of the contravening conduct.

2.     The amount of loss or damage caused.

3.     The circumstances in which the conduct took place.

4.     The size of the contravening company.

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

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

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

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

9.     Whether the company has shown a disposition to co-operate with the authorities responsible for the enforcement of the Act in relation to the contravention.

44    As can be seen, some of these have expressly been taken up in s 24(3) of the DNCR Act. It would be inconsistent with the overarching requirement to look to “all relevant matters” and with the inclusory quality of the provision to treat the matters expressly mentioned in s 24(3) as operating to the exclusion of other matters listed by French J in CSR.

45    Another always relevant matter is the maximum penalty applicable for a contravention.

46    None of this is to say that the Court must impose a pecuniary penalty in every case in respect of each and every contravention. That would be inconsistent with the power granted by s 24(1) of the DNCR Act. That provision is both empowering in the event that there is satisfaction that there has been a contravention and, if so, the source of a discretion which must be exercised judicially not just with the purpose of the civil penalty regime in mind but also in the circumstances of a given case. As explained in Pattinson, at [53]-[54], citing Australian Competition and Consumer Commission v Reckitt Benckiser (Australia) Pty Ltd (2016) 340 ALR 25, at 63 [155]-[156], and Markarian v The Queen (2005) 228 CLR 357, at 372 [31], the maximum is “but one yardstick that ordinarily must be applied”.

47    Taking up the ACMA’s helpful explanation in its submissions, the applicable maximum is worked out in this way. Section 25(3)(a)(i) of the DNCR Act relevantly provides that the maximum penalty payable by a body corporate for a contravention of s 11(1) is 100 penalty units if the person has not previously contravened s 11(1). In turn, s 25(3)(b)(i) relevantly provides that if the body corporate has, on a particular day, committed 2 or more contraventions of s 11(1), the maximum penalty payable for those contraventions must not exceed 2,000 penalty units (which is equivalent to 20 contraventions). As the ACMA correctly submitted, this means that if 20 or more contraventions of s 11(1) occur on the same day, the penalty for that day is capped at 2,000 penalty units.

48    The value of a penalty unit is fixed by and pursuant to s 4AA of the Crimes Act 1914 (Cth), which provides for indexation. As the ACMA again correctly submitted, prior to 1 July 2017, the value of a penalty unit was $180. From 1 July 2017 until the end of the Relevant Period, the value of a penalty unit was $210. As a result, the maximum penalty per contravention prior to 1 July 2017 is $18,000, with a daily maximum penalty of $360,000 (reflecting the “capping mentioned). For the period from 1 July 2017, the maximum penalty per contravention is $21,000, with a daily maximum penalty of $420,000 (again reflecting the capping mentioned).

49    Although a course of conduct is evident in the deemed contraventions, that does not mean that the applicable maximum is any less than that identified in the above discussion: Australian Competition and Consumer Commission v Yazaki Corporation (2018) 262 FCR 243 (Yazaki), at [229]-[233]. As has been said before and more than once, even where present, its role is as a “tool of analysis”: see Yazaki at [234]-[235]. To an extent, s 25(3)(b)(i) takes up, via the daily cap mentioned, what can be an ameliorating effect where a course of conduct is present.

50    Were the case one apt for the imposition of a pecuniary penalty, consideration of the totality principle would also be apt as a final check.

51    The ACMA emphasised the sheer number of contraventions over a seven-month period - 553,630. It also emphasised the repeated compliance warning notifications it had given Balaska after the ACMA had received complaints. These matters are, undoubtedly, relevant.

52    The ACMA also highlighted that Balaska had sought, after the Court’s judgment in ACMA v V Marketing (No 2) was published, further to amend its defence so as to withdraw its admission of contraventions. This, the ACMA submitted, was at odds with a conclusion that Balaska had co-operated with it as regulator, and the Court in the administration of justice and had truly evinced contrition.

53    In these circumstances, the ACMA submitted that a total penalty of $800,000 for Balaska’s contraventions was appropriate.

54    Given the above discussion of the applicable maximum, the penalty suggested by the ACMA was much less than the overall applicable maximum, which is truly staggering. Which is not to say that, in itself, a total penalty of $800,000 is not very large indeed, especially relative to Balaska’s wildly fluctuating profitability from year to year.

55    One case which was cited with approval in Pattinson was Construction, Forestry, Maritime, Mining and Energy Union v Australian Building and Construction Commissioner (2018) 265 FCR 208 (Broadway on Ann). In Broadway on Ann, for reasons explained in our respective judgments, Tracey J and I considered that, in the circumstances of that case, the statutory purpose of deterrence was served by the imposition of the maximum penalty. Although the conduct concerned was serious enough, Tracey J and I each considered that the union’s lengthy history of studied contraventions of the legislation made it necessary to impose the maximum penalty to achieve the purpose of deterrence.

56    The penalisation discretion in respect of Balaska falls to be exercised against very different circumstances to those which persuaded Tracey J and me in Broadway on Ann that the maximum was “appropriate” to serve the statutory purpose of deterrence.

57    That makes it especially important, as was put on behalf of Balaska, not to approach the subject of penalisation on the basis that only by the imposition of a large penalty could the end of deterrence be served. A discretion falls to be exercised, and exercised by applying by analogy these further observations of the plurality in Pattinson, at [46]:

The end of discretion?

It does not follow, as the Full Court suggested and as the CFMMEU argued in this Court, from the rejection of the Full Court’s “notion of proportionality” that s 546 must be taken to require the imposition of a penalty approaching the maximum in relation to any and every contravention by a recidivist offender. It is important to recall that an “appropriate” penalty is one that strikes a reasonable balance between oppressive severity and the need for deterrence in respect of the particular case. A contravention may be a “one-off” result of inadvertence by the contravenor rather than the latest instance of the contravenor’s pursuit of a strategy of deliberate recalcitrance in order to have its way. There may also be cases, for example, where a contravention has occurred through ignorance of the law on the part of a union official, or where the official responsible for a deliberate breach has been disciplined by the union. In such cases, a modest penalty, if any, may reasonably be thought to be sufficient to provide effective deterrence against further contraventions.

[footnote references omitted, emphasis added]

58    Balaska is not, in relation to the DNCR Act, a recidivist offender. It is a first offender.

59    Further, in my view, a factor which I am obliged to take into account are the conclusions and observations, quoted above, made by Thomas J in ACMA v V Marketing (No 2) about Balaska’s directing mind and will, Mr McLennan.

60    This penalty phase is part of a continuum. But for his retirement, it would have been conducted by Thomas J, as the allocated docket judge. Very recently, in Australian Securities and Investments Commission v SunshineLoans Pty Ltd [2025] FCAFC 32, the Full Court, by majority (Bromwich J and Colvin J, Perram J dissenting) overturned a recusal order made in the original jurisdiction in circumstances where, having determined issues of liability in a civil penalty proceeding, the docket judge recused himself from embarking on the penalty phase on the basis that so to do might reasonably give rise to an apprehension of bias. In explaining why in such circumstances, there was no occasion for recusal, Bromwich J, at [101] stated:

… having decided earlier a fact in issue is ordinarily not a case of pre-judgment at all; it is just judgment of a kind that must be carried forward to the next stage no matter who hears it. … in this class of case, the earlier findings and evidence remain relevant to the question before the judge at the next stage …

[Emphasis added]

61    Also in that case and to like effect, Colvin J, at [144] stated:

… the first and second hearings are not separate judicial adjudications. Rather, the first hearing is conducted on the basis that everything that occurs in that hearing that might also bear upon the form or quantum of relief may be brought to account in adjudicating the matters to be addressed at the second hearing (if required). This goes beyond evidence in the first hearing being able to be relied upon in the second. It concerns all aspects of the first hearing, including any views of a kind that quite properly might be formed in the course of adjudicating a trial conducted at a single hearing.

[Emphasis added]

62    Given Mr McLennan’s role in the company, Mr McLennan’s actions, or inactions, are those of Balaska. The ACMA did not press for a departure at this penalty phase from the conclusions and observations made by Thomas J about Mr McLennan. I doubt, strongly, that I could have done that, at least in the absence of new evidence about his actions or inactions during the Relevant Period. There is none.

63    Balaska also put forward in its submissions in support of its ultimate submission that an exercise of the discretion which was open on the evidence was not to impose a penalty at all. These observations made by Gray J in Carr v Higgins Coatings Pty Ltd [2005] FCA 1809 (Carr v Higgins Coatings), at [17] were cited in support:

…The penalisation of those whose conduct is essentially innocent, in order to deter others, is more likely to bring the law into disrepute than to preserve the integrity of the statutory scheme and to bring about widespread compliance with it.

64    Balaska’s conduct was not “essentially innocent”. Contraventions of s 11(1) and what, when s 11(9) is engaged, are taken to be contraventions of s 11(1) are matters of strict liability. In the circumstances of this case, s 11(9) was engaged. There is no necessary inconsistency between the conclusion and observations made by Thomas J about Mr McLennan and a conclusion that Balaska must be taken to have contravened s 11(1). However, the wider circumstances of the deemed contraventions are extenuating. Balaska had, via Mr McLennan, no knowledge of the inadequacy of V Marketing’s “washing” procedures in relation to the Registrar. Its actions, via Mr McLennan, in response to the ACMA’s compliance warnings have been found to be reasonable.

65    These are ameliorating factors in relation to penalty. Their presence in itself makes the penalty promoted by the ACMA completely inappropriate.

66    I do not consider that Balaksa’s application further to amend its defence should lead to a conclusion that it has been other than co-operative. Balaska made a timely admission of contraventions in its Amended Defence in relation to the alleged contraventions. Its much later amendment application was wholly reactive to conclusions and observations made in ACMA v V Marketing (No 2) about Mr McLennan’s conduct and knowledge. That it made the application is understandable. After it proved unsuccessful, Balaska co-operated with the ACMA in agreeing facts to supplement the admission on the pleadings of contravening conduct. In combination, that has meant that, in relation to the Relevant Period there has been no need for a trial on liability issues. This conduct is also an ameliorating factor.

67    In terms of assets, income and workforce, Balaska is a relative minnow. Of course if, in order to serve the purpose of deterrence, the circumstances warranted the fixing of a penalty at a level which might, inevitably, see the company placed in liquidation, this feature of Balaska would not warrant a departure from penalisation at that level. Penalisation at the level promoted by the ACMA might well have this consequence. But the circumstances of this case do not warrant the fixing of penalty at such a level.

68    I cannot see any need for penalisation of Balaska to promote specific deterrence and adherence to the norms ordained in the DNCR Act. Had there been evidence of losses by complainants, the position would have been very different. As it is, the experience of being subject to penal proceedings must itself have been salutary for Balaska. And that will remain so even though the proceedings against Mr McLennan were dismissed.

69    As to general deterrence, the outcome of this proceeding against Balaska, and the declarations I propose to make, will in conjunction with these reasons, serve to demonstrate that although one may “contract out” telemarketing services that does not have the necessary consequence that one has thereby “contracted out” exposure to the risk of penalisation, and penalisation at truly awesome levels. It will not encourage doing nothing in response to compliance correspondence from the ACMA. Instead, given the recognition of the ameliorating effect, it will encourage proactive engagement by a client with a telemarketing contractor to the end of bringing the latter’s conduct into conformity with ordained norms.

70    Yet further, it does not necessarily follow that Mr McLennan’s actions would, if repeated by others necessarily be regarded as reasonable. That conclusion is inherently fact specific. In some instances, it may not be reasonable repeatedly to refer complaints to a telemarketing contractor for investigation. Faced with a repetition of compliance letters and even after referral of earlier ones to the contractor for investigation and explanation, there may come a point where future such referrals are not reasonable, because the continued receipt of compliance letters ought reasonably to be regarded as proof that the engaged contractor is either unable or unwilling to bring its “washing” and other compliance systems into conformity with norms imposed by the DNCR Act. The only reasonable response by a client may be to terminate the contractor’s retainer.

71    When all is said and done, the question of how, appropriately to exercise the penalisation discretion is one of “instinctive synthesis”.

72    Looking at the whole of the circumstances related, and accepting as I do that the purpose of a civil penalty regime is deterrence and, related to that, conformity with a norm ordained by parliament in statute, I am left with the uneasy feeling that, were I to impose any penalty on Balaska in circumstances where its sole director was not a party to contraventions by it or by V Marketing and where his (and thus Balaska’s) actions have been found to be reasonable, the sole justification would be, “Pour encourager les autres”, or rendered into English, “to encourage or deter others”.

73    The origins of the expression “Pour encourager les autres” lie in Voltaire’s remark in Candide about the justification for the carrying into execution by a firing squad of Royal Marines on his ship’s quarterdeck, Royal Navy Admiral John Byng on 14 March 1757 following the verdict of a court martial for the disciplinary offence of neglect of duty. The following account, taken from the biography of Byng in Britannica (https://www.britannica.com/biography/John-Byng) gives context. Byng had been sent with an inadequate force to defend the island of Minorca from attack by the French. By the time he arrived with his force, the principal fortress on the island was already under siege by French land forces. Byng fought a half-hearted engagement with a French fleet under the Marquis de La Galissonnière, and, at a council of war held afterward, he decided that his force was insufficient to either renew the attack or relieve the fort. He therefore returned to Gibraltar, leaving Minorca to the enemy. It is generally thought that, by initiating legal proceedings against Byng, the administration of Great Britain’s then Prime Minister Thomas Pelham-Holles, 1st Duke of Newcastle, hoped to divert public attention from its own failings. So the expression can have pejorative connotations derived from the imposition of a sentence not warranted by individual circumstances but thought to be required for wider policy reasons.

74    Pattinson does not just instruct that the purpose of a civil penalty regime is deterrence, and in this sense, “Pour encourager les autres”. As the passage in Pattinson, at [46] quoted above reveals, that case also instructs that serving that purpose does not inexorably require the imposition of a civil penalty, even in respect of recidivists.

75    I consider that, in the circumstances of this case, to impose even a modest civil penalty on Balaska in the face of the conclusion and observations of Thomas J about its sole director might create an impression that even though its reactions to compliance letters were reasonable, there was nothing which a client could do to avoid penalisation. That would hardly foster a culture of compliance with the norms ordained by the DNCR Act in relation to telemarketing. It would instead foster a sense of injustice.

76    In reaching this conclusion, I have expressly taken into account the sheer number of telemarketing calls which automation permitted to be made over a not insubstantial period (7 months). But that was part of the underlying factual matrix against which Thomas J reached his conclusion and made his observations. That same factual matrix is present here.

77    Although, for the reasons given, I do not consider that Balaska’s conduct was “essentially innocent”, Carr v Higgins Coatings is also noteworthy for the considered discussion by Gray J of the then state of the authorities concerning the granting of declaratory relief in civil penalty proceedings. More recently, Snaden J returned to this subject in a notable discussion of authority in Construction, Forestry, Maritime, Mining and Energy Union v Milin Builders Pty Ltd [2019] FCA 1070. One of the authorities discussed by Snaden J is a judgment of a Full Court (Greenwood, Logan and Yates JJ) of which I was a member, Australian Competition and Consumer Commission v MSY Technology Pty Ltd (2012) 201 FCR 378 (MSY).

78    Balaska did not submit that declaratory relief should not be granted. Its further submission was that there was no need for injunctive relief.

79    In these circumstances, and sitting in the original jurisdiction, I consider that I should apply the following statement by the Full Court in MSY, at [35], in relation to whether to grant declaratory relief:

As has been rightly said, “The remedy of a declaration is not an appropriate way of recording in a summary form, conclusions reached by the Court in reasons for judgment”: Warramunda Village Inc v Pryde (2001) 105 FCR 437 at [8]. There must be some utility in the granting of declaratory relief. In Rural Press Ltd v Australian Competition and Consumer Commission (2003) 216 CLR 53 at [95] (Rural Press) Gummow, Hayne and Heydon JJ saw that utility in the setting out of the basis of the liability found and, in turn, in the basis for the penalties imposed. There is a similar utility here. Further, the declarations which the parties proposed do not, in contrast with those remarked upon in Rural Press, possess the vice of imprecision as to the way in which the statute was contravened

80    The declarations I propose to make will set out the basis of the liability found. They will have this utility. I also propose expressly to order that no penalty be imposed in respect of the contraventions. These reasons for judgment will explain why that order has been made even though there have been declarations of contraventions by Balaska.

81    It does not always follow from declaring that contraventions have occurred that injunctive relief must be granted. The proposed injunctions do nothing more than require compliance with the DNCR Act. There is no hint on the evidence that, in the years that have followed the Relevant Period, Balaska has been disposed to repeat its acknowledged non-complying conduct. As was correctly put for Balaska, inutile injunctive relief has been refused, on that same basis, in Australian Communications and Media Authority v FHT Travel Pty Ltd [2011] FCA 550, at [14], and Australian Communications and Media Authority v Getaway Escapes Pty Ltd [2016] FCA 795, at [23]. I do not consider that the circumstances of this case are apt for the granting of the injunctive relief sought by the ACMA.

82    For completeness, I should mention that another factor relied upon by Balaska in support of its submission that the $800,000 penalty promoted by the ACMA was excessive was an alleged absence of parity as between that penalty and the agreed penalty of $750,000 in respect of the conduct of V Marketing. Initially, that submission had some attraction. However, on reflection, there can be many circumstances relating to the administration of an Act and investigation of alleged contraventions which inform a regulator’s agreeing what is a proceeding in civil jurisdiction, to penalty at a particular level in respect of a particular respondent. One must be careful in importing into civil penalty practice sentencing principles sourced in criminal jurisdiction practice. As I have concluded that, in any event, even without consideration of the relevance if any of “parity”, there is no occasion for the imposition of a civil penalty on Balaska, there is no need in this case further to explore what effect, if any, consideration of “parity” might have. I have not taken that consideration into account in reaching my conclusion as to penalty in relation to Balaska.

83    Also for completeness, I record that my attention was drawn to two previous judgments of this Court where penalties have been imposed in respect of contraventions of the DNCR Act. The circumstances of these cases mentioned were very different to the present – fewer contraventions and a shorter period of overall contravention. Lest it be thought that those circumstances might have provoked reconsidering whether not awarding a penalty was apt, neither was decided against a background akin to the express conclusion and observations made by Thomas J in relation to Mr McLennan. It is not appropriate further to compare and contrast penal outcomes in these other cases. Unlike in the criminal jurisdiction in respect of high-volume offending conduct, contraventions of the DNCR Act to date are so bespoke that outcomes in earlier cases cannot even be regarded as establishing a range of appropriate penal outcomes for particular types of contravening conduct. I therefore do no more than record that I have gained no assistance from these earlier cases with respect to penalty.

V Marketing and Mr Vazquez

84    V Marketing has submitted to the making of the orders sought by the ACMA. It and the ACMA have not separately filed an agreed statement of facts. However, the concession by V Marketing in April 2020 necessarily carried with it, in my view, an admission of the allegations made against it by the ACMA on the pleadings. V Marketing has thus admitted contraventions of s 11(1) of the DNCR Act as there alleged for making unsolicited telemarketing calls to numbers on the Register.

85    The ACMA and Mr Vazquez have in relation to the proceedings against him, filed an (amended) agreed statement of facts. As with Balaska and by reason of s 191 of the Evidence Act, it is unnecessary for the ACMA to lead evidence in relation to the facts so agreed for the purposes of the proceeding against Mr Vazquez.

86    Drawing upon the facts agreed as between the ACMA and Mr Vazquez, I make the following findings in respect of the proceedings against him.

87    Mr Vazquez was the sole director of V Marketing from the date of its incorporation and was responsible for the day-to-day management of the company’s telemarketing business. He was the “directing mind and will” of V Marketing.

88    V Marketing’s primary business was the making of Telemarketing Calls in respect of the sale, supply and installation of solar energy systems. lt made these calls at its call centre located in Bundall, Queensland.

89    During the period from I March 2017 to 27 September 2018 (the Vazquez Relevant Period), V Marketing employed 14 full-time staff and 15 casual staff, 13 of whom worked in its call centre. One of these full-time staff was a Mr McEvoy, the General Manager. Mr McEvoy was a subordinate of Mr Vazquez as sole director.

90    The call centre made outbound calls only to NSW and Queensland telephone numbers from 12pm to 7pm, Monday to Friday.

91    During the period from 1 March 2017 to 30 September 2017, V Marketing carried on telemarketing activity using the automatic dialler exclusively on behalf Balaska.

92    Specifically, it made Telemarketing Calls at its Bundall call centre in respect of Balaska’s solar energy systems.

93    From mid November 2017 onward, V Marketing only made Telemarketing Calls in respect of its own solar energy systems, known as Your Choice Solar.

94    V Marketing obtained telephone numbers from two main sources, Australia on Disk and pricefinder.com.au. ln the Vazquez Relevant Period, V Marketing had a procedure to “wash” numbers against the Register. The procedure was set out in a document entitled “Washing leads with Australia on Disk” (Washing Procedure). V Marketing employed 3 junior staff to follow the Washing Procedure in the course of loading telephone numbers into its automatic dialler. During the Vazquez Relevant Period, V Marketing did not adequately supervise these staff to ensure the Washing Procedure was followed, nor was the Washing Procedure itself sufficient to ensure compliance with s 11 of the DNCR Act.

95    From 28 February 2017, Mr Vazquez knew that the ACMA had received complaints alleging that calls were made to Registered Numbers promoting Balaska, and that the ACMA had issued compliance warnings to Balaska in relation to alleged breaches of the DNCR Act. From 18 April 2018, Mr Vazquez knew that the ACMA was investigating alleged breaches of the DNCR Act by Balaska and V Marketing.

96    Mr Vazquez has admitted that Balaska forwarded 5 of the compliance warning letters it received to V Marketing.

97    Between April 2018 and March 2019, the ACMA conducted an investigation of alleged breaches of the DNCR Act by Balaska and V Marketing. The investigations included the gathering of information and obtaining of documents via notices issued by the ACMA under s 522 of the Telecommunications Act 1997 (Cth). Related, consequential exchanges and meetings occurred over this period between officers of the ACMA and persons acting on behalf of V Marketing, including Mr Vazquez.

98    At all material times, Mr Vazquez knew V Marketing was required to comply with the DNCR Act, specifically s 11 of the DNCR Act. Mr Vazquez did not take any material step to ensure that V Marketing complied with s 11 of the DNCR Act when making telemarketing calls on behalf of Balaska or on its own behalf, or any material step to prevent future non-compliance with s 11 of the DNCR Act. Mr Vazquez also knew that V Marketing did not have in place systems that were reasonably adequate for ensuring that it did not make, attempt to make, or cause to be made, Telemarketing Calls to Registered Numbers.

99    During the period 1 March 2017 to 30 September 2017, Mr Vazquez directed or authorised V Marketing to make, attempt to make or cause to be made 553,630 telemarketing calls on behalf Balaska to numbers on the Register.

100    During the period from 1 February 2018 to 27 September 2018, Mr Vazquez directed or authorised V Marketing to make, attempt to make or cause to be made 548,688 telemarketing calls to numbers on the register.

101    Mr Vazquez admits that, between 1 March January 2017 to 30 September 2017, he contravened s 11(7) of the DNCR Act by being knowingly concerned in V Marketing's contravention of s 11(1) of the DNCR Act which involved V Marketing, on behalf of Balaska, making, attempting to make or causing to be made, 553,630 telemarketing calls on behalf Balaska to numbers on the Register.

102    Mr Vazquez also admits that, between 1 February 2018 to 27 September 2018, he contravened s 11(7) of the DNCR Act by being knowingly concerned in V Marketing's contravention of s 11(1) of the DNCR Act which involved V Marketing, on its own behalf, making, attempting to make or causing to be made, 548,688 telemarketing calls to numbers on the Register.

103    As for V Marketing itself, there is no doubt that the company engaged in the conduct alleged in contravention of s 11(1) of the DNCR Act or that its “washing” procedures were inadequate to ensure telemarketing call were not made to number on the Register. The calls concerned were a telemarketing activity using voice telephone calls made by V Marketing’s employees or agents to members of the public to offer, advertise or promote the sale, supply and installation of solar energy systems. For the period between 1 March 2017 to 30 September 2017, 553,630 such telemarketing calls were made on behalf Balaska to numbers on the Register. During the period 1 February 2018 to 27 September 2018, a further 548,688 telemarketing calls were made by V Marketing staff on its own behalf to Australian numbers that were registered on the Register. These also related to the sale, supply and installation of solar energy systems.

104    I have already discussed above, and therefore do not repeat, authorities concerning the purpose of a civil penalty regime and other factors relevant to the imposition of a penalty.

105    In relation to V Marketing, and also Mr Vazquez as a party to its contraventions, the ACMA submitted that the contravening conduct should be viewed as two courses of conduct: one concerning telemarketing activities on behalf of Balaska; the other concerning telemarketing activities conducted on its own behalf. The period of the former preceded that of the latter. That strikes me as a logical way in which to conceive the contravening conduct for the purposes of penalisation. It does not mean that the maximum is thereby reduced, only that two courses of conduct are evident.

106    Because V Marketing is, once again, restored to the ASIC register but is nonetheless a company in liquidation, a question arises as to whether it is appropriate to impose any penalty?

107    To continue the analogy with the 17th century regicides, after their exhumed corpses had been tried and convicted of treason, they were hanged and beheaded with the severed heads of the late Lord Protector Cromwell and other principal but deceased regicides then being placed on long spikes at Parliament House as an enduring warning to those still numbered in the living who may be contemplating treason.

108    It might be thought that analogous sentiments underpin these observations made by the Full Court in Australian Competition and Consumer Commission v Dataline.Net.Au Pty Ltd (2007) 161 FCR 513, at [20], a case helpfully put to me by the ACMA with respect to the imposition of a penalty on a company in liquidation:

… a court may impose a penalty on a company in liquidation if, to do so, would clearly and unambiguously signify to, for example, companies … in a discrete industry that a penalty of a particular magnitude was appropriate (and was of a magnitude which might be imposed in the future) if others in the industry sector engaged in the same or similar conduct.

109    An alternative would, I suppose, be just to indicate in reasons for judgment what the penalty would have been but for liquidation. However, I consider that the purpose of deterrence is better served by a formal imposition of penalties.

110    It is obvious that there was no culture of compliance with the DNCR Act within V Marketing. Its internal procedures were inadequate to ensure, with a high degree of certainty, that calls would not be made to numbers on the Register. This is all the more serious because, as is confirmed by the circumstances of this case, technology permitted a very large number of calls to be made. That makes it all the more essential that “washing” procedures be adapted to removing from automated telemarketing calling numbers on the Register.

111    Another aggravating factor is that the contraventions of the DNCR Act occurred over two sequential periods which, in aggregate, equal a period of about 18 months.

112    Yet another aggravating factor is that V Marketing was put on notice, more than once, by Balaska of the receipt of compliance letters from the ACMA concerning complaints about telemarketing calls being made to numbers on the Register. Yet the contravening conduct persisted.

113    As I noted at the start of these reasons, the DNCR Act serves a particular public interest by allowing people, via the simple step of placing their number on the Register, to take a measure aimed at eliminating the nuisance of unsolicited telemarketing calls to their number. A correlative obligation is then placed on persons not to make calls to numbers on the Register. The civil penalty regime buttresses that obligation and that public interest. Thus, a price needs to be put on contravening conduct which is sufficiently high to make engaging in such conduct more than just a cost of conducting a telemarketing business. In effect, the penalty must be sufficiently high as to make it a rational conclusion that it is a form of economic suicide to contravene the DNCR Act.

114    Although, as this case illustrates, a client cannot “contract out” of a potential liability for contravening conduct via the engagement of a telemarketing company, it needs to be remembered that telemarketing is not illegal. Thus, legitimate commercial interests are served by imposing penalties on contravening telemarketing companies at a level which will deter like companies in the industry from “cutting corners” in relation to their compliance procedures. The penalty must be at a level which will reduce the chance of unscrupulous telemarketing companies from under-cutting the scrupulous who incur the cost of implementing high quality compliance systems which avoid the making of calls to numbers on the Register.

115    The maximum penalties which are applicable in respect of contraventions of the DNCR Act themselves show that Parliament has placed a premium on engendering compliant behaviours. That does not mean that such maximums must in every case be imposed.

116    V Marketing’s annual gross revenue in the financial year ending 30 June 2017 V Marketing was approximately $1,800,000. It had staff to employ and doubtless had other operating costs arising from the automated calling systems it used. Nonetheless, it is relevant to take into account that gross revenue when considering what is an appropriate penalty to serve the end of deterrence. V Marketing’s status as a company in liquidation means there is no need for specific deterrence, but the penalty must still be one which brings home to anyone who would be tempted to engage in like contravening conduct, and who is aware via these reasons of V Marketing’s gross revenue in the 2017 financial year, just how economically foolish succumbing to temptation would be.

117    It is said that a penalty should not be fixed at a level which would be oppressive. Care needs to be taken about that. If a penalty at a particular level is, as a matter of deliberate, judicial discretionary value judgement, necessary in order to achieve the statutory purpose of deterrence, it matters not that a penalty at this level might be ruinous.

118    Here, apart from the course of conduct principle, ameliorating factors are that V Marketing had not previously contravened the DNCR Act and that it promptly signified, via its then liquidators, that it would not contest the proceedings and did not wish to be heard save in respect of costs.

119    The ACMA submitted that an overall penalty of $1,500,000, equally divided as between the two identified courses of conduct via a single penalty in each instance would justly serve the statutory purpose of deterrence in the circumstances of this case. Measured against the gross annual turnover mentioned, and taking into account aggravating and ameliorating factors, a penalty in this amount nicely serves the objective of general deterrence. No greater sum is necessary in my view to achieve this objective. That remains so even after as a final check applying the totality principle. Indeed, so doing reinforces in my view that the overall penalty is appropriate.

120    I have already discussed in relation to Balaska authorities which touch on whether to make declaratory orders. I consider it essential that, in conjunction with the penalty orders, there be orders which declare what was the contravening conduct.

121    This then leaves for determination what to do in relation to Mr Vazquez?

122    The parties filed a joint submission which stated that they were agreed, that in addition to injunctive relief, that the total penalty which should be imposed on Mr Vazquez was $60,000.00.

123    Initially, this caused me some disquiet. There were inter-related reasons for this:

(a)    impressionistically, it struck me that, given the statutory purpose of deterrence, it under penalised the sole director knowingly concerned in 1,102,318 corporate contraventions of the DNCR Act spanning an overall period of 18 months (March 2017 to September 2018);

(b)    even though the applicable overall maximum penalty (in this case for an individual rather than corporate contravenor) is but a “yardstick”, the agreed penalty sum struck me as quite out of kilter with that maximum;

(c)    the agreed penalty also struck me, again impressionistically, as at odds with the reasoning which underpinned the promotion by the ACMA of an overall penalty of $1,500,00 in respect of V Marketing.

124    Having disclosed these impressionistic concerns, I offered the ACMA and V Marketing an opportunity to make and file supplementary submissions. Each took up that opportunity. I am grateful that they did. What follows reflects my acceptance of their original submissions as so supplemented.

125    Pattinson’s confirmation as to the purpose of a civil penalty regime is, of course, important, binding and relevant. However, for present purposes a starting point must be observations made in the High Court in the earlier decided Agreed Penalties Case. The Agreed Penalties Case quelled, emphatically, differences of view in this Court and in others about the effect of an agreement as to penalty reached by a regulator and another party in civil penalty proceedings and allayed concerns that such agreements operated as a fetter on a judicial penalty discretion, in effect treating a court as a “rubber stamp”.

126    The Agreed Penalties Case also put to rest related concerns arising from Barbaro v The Queen (2014) 253 CLR 58 (Barbaro) about the continuing authority of NW Frozen Foods Pty Ltd v Australian Competition and Consumer Commission (1996) 71 FCR 285 (NW Frozen Foods) and Minister for Industry, Tourism and Resources v Mobil Oil Australia Pty Ltd [2004] ATPR 41-993 (Mobil Oil). Suffice it to say, Barbaro was held to be applicable only to cases concerning sentencing in the criminal jurisdiction and NW Frozen Foods and Mobil Oil were expressly approved as of continuing authority and application to civil penalty proceedings.

127    At the heart of all this was the highlighting by the plurality of the High Court in the Agreed Penalties Case that civil penalty proceedings were but a subset of civil litigation in which it was routine for parties to reach a compromise position and where necessary jointly to promote orders necessary to give effect to their compromise. The plurality of the High Court in the Agreed Penalties Case also rejected any working assumption that judges would be other than faithful to their judicial oaths in deciding whether to act on an agreed position as to the outcome of a civil penalty proceeding, including making any penalty orders. Related to this was that the Court should afford particular weight to the revealed reasoning of a regulator as to why it had agreed with a party jointly to promote agreed penalty outcomes.

128    These views, and more, are evident in the following passages from the judgment of the plurality in the Agreed Penalties Case, at [57]-[58]:

57.    In contrast, in civil proceedings there is generally very considerable scope for the parties to agree on the facts and upon consequences. There is also very considerable scope for them to agree upon the appropriate remedy and for the court to be persuaded that it is an appropriate remedy. Accordingly, settlements of civil proceedings are commonplace and orders by consent for the payment of damages and other relief are unremarkable. So are court-approved compromises of proceedings on behalf of infants and persons otherwise lacking capacity, court-approved custody and property settlements, court approved compromises in group proceedings and court-approved schemes of arrangement. More generally, it is entirely consistent with the nature of civil proceedings for a court to make orders by consent and to approve a compromise of proceedings on terms proposed by the parties, provided the court is persuaded that what is proposed is appropriate.

58.    Possibly, there are exceptions to the general rule. There is, however, no reason in principle or practice why civil penalty proceedings should be treated as an exception. Subject to the court being sufficiently persuaded of the accuracy of the parties’ agreement as to facts and consequences, and that the penalty which the parties propose is an appropriate remedy in the circumstances thus revealed, it is consistent with principle and, for the reasons identified in Allied Mills, highly desirable in practice for the court to accept the parties’ proposal and therefore impose the proposed penalty. To do so is no different in principle or practice from approving an infant’s compromise, a custody or property compromise, a group proceeding settlement or a scheme of arrangement.

[footnote references omitted – emphasis in original]

129    The ACMA and Mr Vazquez jointly submitted that:

There is an important public policy interest in giving effect to agreements as to penalty, particularly where such agreements encourage persons to acknowledge contraventions and thereby avoid lengthy and complex litigation and promote predictability of outcomes in civil penalty proceedings.

I accept that there is such a public interest and that it is abroad in this case.

130    The ACMA and Mr Vazquez agree that the calls made to numbers on the Register caused annoyance and inconvenience to members of the public who had taken up the ability to list their number on the Register. But they also agree that no financial loss was occasioned to anyone. That is so even though it is accepted by Mr Vazquez that there were 1,102,318 contravening calls in the making of which he was knowingly concerned.

131    The parties are agreed that the contravening calls had the potential to “undermine the objectives and integrity of the DNCR Act”. With respect, that understates matters. The making of 1,102,318 contravening calls over a period of many months did undermine the objectives and integrity of the DNCR Act. How could it be concluded otherwise? So the contravening conduct was serious not just as viewed as conduct of V Marketing but also as conduct in which that company’s directing mind and will, Mr Vazquez was knowingly concerned.

132    It necessarily follows from the conclusion reached in relation to V Marketing as principal contravener that I accept that there are likewise two courses of conduct revealed in respect of Mr Vazquez as an accessory to that conduct.

133    All this said, the parties are agreed that Mr Vazquez has shown a significant degree of cooperation with the ACMA’s investigation and in the proceedings, including making the admissions in the amended statement of agreed facts. They are also agreed that, in November 2018, Mr Vazquez also engaged the firm Radcliffs to be part of V Marketing’s self-imposed internal audit of compliance with the DNCR Act.

134    The parties have made explicit that the total penalty they promote by agreement reflects a discount of 30% in respect of Mr Vazquez’s co-operation. It is certainly correct in principle to discount what would otherwise be an appropriate penalty to reflect co-operation with the administration of justice by ready acknowledgement of contraventions at an early stage. The expense of a trial is thereby saved by the ACMA and scarce judicial resources which would otherwise have to be deployed in conducting that trial and determining its outcome are liberated to be deployed in other cases.

135    As to the maximum penalty applicable to contravening conduct by an individual, the parties are agreed that the position is as follows (as extracted from the amended joint agreed submission) as between the ACMA and Mr Vazquez filed on 16 September 2024.

136    Section 25(4)(a)(i) of the DNCR Act relevantly provides that the maximum penalty payable by a person who is not a body corporate for a contravention of s 11(7) is 20 penalty units if the person has not previously contravened s 11(7). Mr Vazquez has not previously contravened s 11(7).

137    Section 25(4)(b)(i) of the DNCR Act relevantly provides that if the person has, on a particular day, committed 2 or more contraventions of s 11(7), the maximum penalty payable for those contraventions must not exceed 400 penalty units (which is equivalent to 20 contraventions). This means that if 20 or more contraventions of s 11(7) occur on the same day, the penalty for that day is capped at 400 penalty units.

138    Prior to 1 July 2017 , the value of a penalty unit was $180. From 1 July 2017 until the end of the 27 September 2018 (the date of the last contravention), the value of a penalty unit was $210. As a result, the maximum penalty per contravention prior to 1 July 2017 is $3,600, with a daily maximum penalty of $72,000. For the period from 1 July 2017, the maximum penalty per contravention is $4,200, with a daily maximum penalty of $84,000.

139    V Marketing made calls to numbers on the Register on 89 days during the period 1 March 2017 to 30 June 2017; 66 days during the period 1 July to 30 September 2017; and 140 days during the period from then until 27 September 2018. On each of these days, V Marketing made 20 or more calls. It is admitted that Mr Vazquez was knowingly concerned in each of these calls in contravention of s 11(7), with the result that the cap on the maximum penalty in s 25(4)(b)(i) applies to each of these days. This means that the maximum penalty is $6,408,000 for the period 1 March 2017 to 30 June 2017; $4,752,000 for the period 1 July to 30 September 2017; and $10,080,000 for the period from then until 27 September 2018, giving a total penalty of $21,240,000. across the 2017 Relevant Period and 2018 Relevant Period.

140    “Yardstick” though a maximum penalty is, it was this large discrepancy between what was jointly promoted and the maximum which was one of the factors which concerned me about the total penalty promoted by agreement. Even allowing for the statutory capping, it is quite obvious that parliament had put a very considerable premium on compliance. In circumstances where automation can in short order generate a large number of contravening calls if a telemarketing company’s “washing” procedures are either non-existent or inadequate, it is not hard to understand why penalties of this large order have been fixed. Further, while deployment of artificial intelligence vetting might perhaps be possible (and I have no evidence about this) public resources are finite and a “surveillance State” may bring with it its own public policy concerns. Making maximum penalties this high is conducive to compliance and a related saving of public investigatory resources.

141    In separate and helpful supplementary submissions, counsel for Mr Vazquez drew my attention to these observations (of which I was not previously aware) made by Derrington J in Clean Energy Regulator v E Connect Solar & Electrical Pty Ltd [2023] FCA 1082 (Clean Energy Case), at [81] and [89]:

81.    It would accordingly be contrary to principle to treat the fact that the contravening conduct has been characterised as “very serious” as excluding the possibility that penalties of $20,000 against each of the individual contravenors might be appropriate. The focus of the analysis must remain squarely on the objective of deterrence. The fact that the individual contravenors have freely cooperated with the CER, have made timely admissions in relation to their conduct, and have assisted in progressing the matter efficiently through this Court does suggest a substantially lessened need for specific deterrence, and must therefore go some ways to diminishing the quantum of the penalties to be imposed. Indeed, the joint submissions make clear that the proposed penalties reflect a “significant discount” for this cooperation.

…

89.    … Although there is no “checklist” of the matters to be considered in determining an appropriate penalty, the Court will ordinarily expect to see at least some evidence of an individual contravenor’s financial capacity, such that it is able to assess the specific deterrent effect, or the “sting”, that the penalty is likely to have: see, generally, Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (2018) 262 CLR 157 at 195 -196 [116]. See, eg, Tax Practitioners Board v Caolboy (2020) FCA 1559 [51], [70]; Australian Competition and Consumer Commission v We Buy Houses Pty Ltd (No 2) [2018] FCA 1748, at [124] – [126]. Particularly where, as here, the regulator has dealt with cooperative contravenors and, presumably, had at least some regard to the means available to them to meet the proposed penalties, it would not seem to be too onerous a task for the parties to furnish the Court with material going to this point. At the very least, the regulator could provide the Court with an informed or researched opinion in relation to these matters, such that the Court is not left to act upon inferences.

…

142    His Honour’s observations at [81] were made against the background of an agreed penalty between the regulator and the individual directors of $20,000, in circumstances where the maximum penalty against the directors was $357,000 in the case of one and $441,000 in the case of the other.

143    I respectfully agree with these observations made by Derrington J in the Clean Energy Case.

144    Mr Vazquez has not left the Court or the ACMA as regulator in a position of ignorance as to his financial position. That position, as revealed by the “Vazquez personal asset list” exhibit (p 379) to an affidavit made and filed by him does indeed, as the ACMA submitted, suggest Mr Vazquez has real estate assets with a net estimated value of between $1,834,000 and $2,259,000, plus $646,000 cash in an offset account.

145    In voicing its continued support for the promoted agreed penalty outcome, the ACMA stated, explicitly, that it had taken this revealed financial position into account.

146    Mr Vazquez has offered, and the ACMA has agreed to accept a contribution of $10,000.00 in respect of the proceedings as against him. Nothing more is sought by way of a costs order against him.

147    As with Balaska, my attention was drawn to the two previous occasions when this Court has imposed civil penalties in respect of contraventions of the DNCR Act. Once again, the circumstances of each of those cases are so different to those applicable to V Marketing and Mr Vazquez as to make it neither necessary nor desirable to refer to them.

148    The Clean Energy Case shows that even a large discrepancy between a maximum penalty and an agreed penalty jointly promoted by parties does not have the necessary consequence that the agreed penalty must be rejected. In principle that must be so. When all is said and done, the imposition of penalty is a matter for the exercise of a judicial discretion and one of “instinctive synthesis”.

149    Confession is not just good for the soul. Promoting it, especially when it occurs at an early stage is good for public administration of a statutory code of behaviour buttressed by civil penalties and for the administration of justice in exercising a civil penalty jurisdiction. To be sure, the views of a regulator are but those of a party and cannot bind the Court. But a considered value judgement of a regulator that an agreed penalty at a particular level will serve the objective of deterrence is to be respected.

150    It will, I trust, be obvious from this perhaps overly lengthy reflection on whether to take up in penalisation against Mr Vazquez the jointly promoted total penalty that the Court is no mere “rubber stamp”. The concerns I initially voiced have been addressed. I consider the jointly promoted penalty “sufficient unto the day” in all of the circumstances.

151    In my view, there is, as a matter of deliberate, discretionary value judgement, a strong case revealed for the granting of the injunctive relief jointly promoted by the ACMA and Mr Vazquez. It will be conducive to ensuring that the compliance and washing procedural inadequacies of the past are not repeated by Mr Vazquez in any future telemarketing endeavour. There is also a strong case for the granting of declaratory relief in respect of the contraventions.

152    There will as against Balaska, V Marketing and Mr Vazquez, be orders accordingly.

Associate:    

Dated:    31 March 2025

SCHEDULE OF PARTIES