Australian Communications and Media Authority v Radio 2UE Sydney Pty Ltd (No 2)

[2009] FCA 754

FEDERAL COURT OF AUSTRALIA

Australian Communications and Media Authority v Radio 2UE Sydney Pty Ltd (No 2) [2009] FCA 754

PECUNIARY PENALTIES –– contravention –– enforcement and remedies –– civil penalty provision –– pecuniary penalty –– determination of –– Broadcasting Services Act 1992 (Cth) –– ss 140A, 205F –– factors to be considered –– principles to be applied by Court when parties agree on penalty –– circumstances in which Court will depart from agreed penalty –– intervenor opposes agreed penalty –– regulator’s views not determinative of the penalty –– Court need not begin analysis with agreed penalty range –– importance of the regulator explaining its approach for discounting the penalty –– Court may reject agreed penalty if it is plainly unreasonable or unjust or manifestly inadequate or excessive –– totality principle applies to pecuniary penalties

PECUNIARY PENALTIES –– purposes –– depending on statutory scheme can include, in addition to deterrence, punishment and retribution

COMMUNICATIONS LAW –– broadcasting services licence –– nature of licence –– rights to operate a broadcasting licence is a privilege granted under the Broadcasting Services Act 1992 (Cth) ss 3(1) and 4(1) –– licensee holds a position of public trust ­­–– public interest considerations in the statutory scheme –– ability for broadcasting to exert influence in shaping community views –– holding licence means assuming a position of public trust –– disclosure standard a method of ensuring transparency in current affairs

COMMUNICATIONS LAW –– Broadcasting Services Act 1992 (Cth) –– ss 140A, 205F –– breaches of Broadcasting Services (Commercial Radio Current Affairs Disclosure) Standard 2000 –– famous radio personality commits contraventions –– proceedings for agreed penalty –– liability under s 140A of licence in respect of conduct by contravening “star” is direct, not vicarious, liability of the licensee –– Australian Communications Media Authority

COMMUNICATIONS LAW –– PECUNIARY PENALTIES  –– Broadcasting Services Act 1992 (Cth) –– penalty range –– s 205F(3) –– Court must have regard to “all relevant matters” in fixing a penalty –– general and particular deterrence –– public interest considerations –– punishment or retribution for violating the public trust in fixing a penalty under the Act –– nature and extent of contraventions –– circumstances of the contraventions –– relevance of alternative methods of enforcement for similar/same contraventions –– criminal proceedings may be commenced after civil penalty imposed –– whether choice to bring civil penalty proceedings, rather than criminal prosecution, indicated a lighter penalty –– no answer that internal compliance review processes miscarried –– history of contravening –– relevance of respondent’s early admission of liability –– whether co-operation with prosecuting authority ameliorates penalty –– contraventions were reckless and demonstrated a contempt for the standard –– offence towards the higher end of range

Held: Agreed penalties of $130,000 as a whole manifestly inadequate for 13 serious breaches; penalties totalling $360,000 imposed
Broadcasting Services Act1992 (Cth) ss 3, 4, 5 139, 140A, 205F, 205G, 205L, 205M, 205N, 205W, 205X, Sch 2
Communications and Legislation Amendment (Enforcement Powers) Act 2006 (Cth)

Broadcasting Services (Commercial Radio Current Affairs Disclosure) Standard 2000

Amalgamated Television Services Pty Ltd v Marsden (1998) 43 NSWLR 158 considered
Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 cited
Australian Competition and Consumer Commission v PRK Corporation Pty Ltd [2009] FCA 715 cited
Australian Competition and Consumer Commission v Qantas Airways Ltd (2008) 253 ALR 89 discussed
Cameron v The Queen (2002) 209 CLR 339 cited
Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Australia Competitions and Consumer Commission (2007) 162 FCR 466 cited
Director of Public Prosecutions v United Telecasters Sydney Ltd (1990) 168 CLR 594 cited
Gray v Motor Accident Commission (1998) 196 CLR 1 cited
Hamilton vWhitehead (1988) 166 CLR 121 followed/discussed
L Vogel & Sons Pty Ltd v Anderson (1968) 120 CLR 157 applied
Lamb v Cotogno (1987) 164 CLR 1 discussed
Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 cited
Lukatela v Brich (2008) 223 FLR 1 cited
Markarian v The Queen (2005) 228 CLR 357 cited
Mill v The Queen (1988) 166 CLR 59 applied
Minister for Industry Tourism and Resources v Mobil Oil Australia Pty Ltd (2004) ATPR ¶41-993 applied
Mornington Inn Pty Ltd v Jordan (2008) 168 FCR 383 followed
NW Frozen Foods Pty Ltd v Australian Competition and Consumer Commission (1996) 71 FCR 285 followed
Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 cited
RH McL v The Queen (2000) 203 CLR 452 cited
Rich v Australian Securities and Investments Commission (2004) 220 CLR 129 cited
Ryan v The Queen (2001) 206 CLR 267 cited
Secretary, Department of Health and Aging v Pagasa Australia Pty Ltd [2008] FCA 1545 followed
Tesco Supermarkets Ltd v Nattrass [1972] AC 153 cited
Trade Practices Commission v CSR Limited (1991) ATPR ¶41-076 applied/distinguished
Victoria v Australian Building Construction Employees’ and Builders Labourers’ Union (1982) 152 CLR 25 discussed
Weininger v The Queen (2003) 212 CLR 629 cited
Wong v The Queen (2001) 207 CLR 584 cited

AUSTRALIAN COMMUNICATIONS AND MEDIA AUTHORITY v RADIO 2UE SYDNEY PTY LTD

NSD 1841 of 2008

RARES J
17 JULY 2009
SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 1841 of 2008
GENERAL DIVISION

BETWEEN: AUSTRALIAN COMMUNICATIONS AND MEDIA AUTHORITY
Applicant

AND:

RADIO 2UE SYDNEY PTY LTD
Respondent

COMMUNICATIONS LAW CENTRE
Intervenor

JUDGE:	RARES J
DATE OF ORDER:	17 JULY 2009
WHERE MADE:	SYDNEY

THE COURT ORDERS THAT:

1.The respondent pay to the Commonwealth a pecuniary penalty of $10,000 in that it contravened s 140A(3) of the Broadcasting Services Act 1992 (Cth) (‘the Act’) at 11.26am on 5 October 2007 by failing to make a disclosure announcement in accordance with a condition of its commercial radio broadcasting licence set out in cl 8(1) of Schedule 2 of the Act to comply with cl 7 of the Broadcasting Services (Commercial Radio Current Affairs Disclosure) Standard2000 (‘a disclosure announcement’) that Hamilton Island Enterprises Ltd was a sponsor of John Laws at the time of an on-air mention of Hamilton Island.

2.The respondent pay to the Commonwealth a pecuniary penalty of $10,000 in that it contravened s 140A(3) of the Act at 11:40am on 5 October 2007 by failing to make a disclosure announcement that Hamilton Island Enterprises Ltd was a sponsor of John Laws at the time of an on-air mention of Hamilton Island.

3.The respondent pay to the Commonwealth a pecuniary penalty of $20,000 in that it contravened s 140A(3) of the Act at 10:06am on 18 October 2007 by failing to make a disclosure announcement that Byron Bay Beverages Pty Ltd was a sponsor of John Laws at the time of an on-air mention of Byron Bay Beer.

4.The respondent pay to the Commonwealth a pecuniary penalty of $20,000 in that it contravened s 140A(3) of the Act at 10:28am on 18 October 2007 by failing to make a disclosure announcement that Byron Bay Beverages Pty Ltd was a sponsor of John Laws at the time of an on-air mention of Byron Bay Beer.

5.The respondent pay to the Commonwealth a pecuniary penalty of $25,000 in that it contravened s 140A(3) of the Act at 11:13am on 24 October 2007 by failing to make a disclosure announcement that Toyota Motor Corporation Australia Ltd was a sponsor of John Laws at the time of an on-air mention of a Toyota Landcruiser.

6.The respondent pay to the Commonwealth a pecuniary penalty of $25,000 in that it contravened s 140A(3) of the Act at 11:14am on 24 October 2007 by failing to make a disclosure announcement that Byron Bay Beverages Pty Ltd was a sponsor of John Laws at the time of an on-air mention of Byron Bay Beer.

7.The respondent pay to the Commonwealth a pecuniary penalty of $30,000 in that it contravened s 140A(3) of the Act at 10:10am on 24 October 2007 by failing to make a disclosure announcement that Hamilton Island Enterprises Ltd was a sponsor of John Laws at the time of an on-air mention of Hamilton Island.

8.The respondent pay to the Commonwealth a pecuniary penalty of $45,000 in that it contravened s 140A(3) of the Act at 11:51am on 26 October 2007 by failing to make a disclosure announcement that Hamilton Island Enterprises Ltd was a sponsor of John Laws at the time of an on-air mention of Hamilton Island.

9.The respondent pay to the Commonwealth a pecuniary penalty of $35,000 in that it contravened s 140A(3) of the Act at 11:21am on 2 November 2007 by failing to make a disclosure announcement that Toyota Motor Corporation Australia Ltd was a sponsor of John Laws at the time of an on-air mention of Toyota.

10.The respondent pay to the Commonwealth a pecuniary penalty of $10,000 in that it contravened s 140A(3) of the Act at 9:53am on 30 November 2007 by failing to make a disclosure announcement that Roche Group Pty Ltd was a sponsor of John Laws at the time of an on-air mention of the Roche Family.

11.The respondent pay to the Commonwealth a pecuniary penalty of $35,000 in that it contravened s 140A(3) of the Act at 10:21am on 30 November 2007 by failing to make a disclosure announcement that Toyota Motor Corporation Australia Ltd was a sponsor of John Laws at the time of an on-air mention of a Toyota Hi-Lux

12.The respondent pay to the Commonwealth a pecuniary penalty of $45,000 in that it contravened s 140A(3) of the Act at 11:14am on 30 November 2007 by failing to make a disclosure announcement that Byron Bay Beverages Pty Ltd, Toyota Motor Corporation Australia Ltd, Qantas Airways Ltd and Oatley Family Wines were sponsors of John Laws at the time of on-air mentions of Bryron Bay lager, Toyota, Qantas and Wild Oats wine.

13.The respondent pay to the Commonwealth a pecuniary penalty of $50,000 in that it contravened s 140A(3) of the Act at 11:25am on 30 November 2007 by failing to make a disclosure announcement that Toyota Motor Corporation Australia Ltd was a sponsor of John Laws at the time of an on-air mention of Toyota.

THE COURT NOTES:

14.The agreement between the parties that the respondent will pay the applicant $20,000 in respect of its costs.

Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

The text of entered orders can be located using eSearch on the Court’s website.

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 1841 of 2008
GENERAL DIVISION

BETWEEN: AUSTRALIAN COMMUNICATIONS AND MEDIA AUTHORITY
Applicant

AND:

RADIO 2UE SYDNEY PTY LTD
Respondent

COMMUNICATIONS LAW CENTRE
Intervenor

JUDGE:	RARES J
DATE:	17 JULY 2009
PLACE:	SYDNEY

REASONS FOR JUDGMENT

1. The Australian Communications and Media Authority has applied for orders that Radio 2UE Sydney Pty Ltd pay pecuniary penalties pursuant to s 205F(1) of the Broadcasting Services Act1992 (Cth) in respect of 13 breaches of a condition in Radio 2UE’s commercial radio broadcasting licence and for declarations recording each contravention. Each breach contravened s 140A(3) of the Act and attracted liability for a civil penalty (s 140A(7)). Each contravention attracted a maximum civil penalty of 500 penalty units, a total of $55,000 (see ss 139(3), 140A(3), 205F(4)). The breaches occurred over the course of 2 months in late 2007 when the well-known broadcaster, John Laws, failed to make disclosure announcements that he was sponsored by businesses at the time and as part of the broadcasts in which his sponsors’, or their products’ or services’, names were mentioned during the course of his morning radio program, The John Laws Morning Show.    I have attached a description of each contravention in a schedule to these reasons taken from the Authority’s investigation report No 2100 of October 2008.  Mr Laws was paid very large sums of money by these businesses for their sponsorship.

2. The Authority had made a program standard known as the Broadcasting Services (Commercial Radio Current Affairs Disclosure) Standard 2000 pursuant to s 125 of the Act. The disclosure standard commenced in January 2001. It had been made following a report of the Authority’s predecessor, the Australian Broadcasting Authority, called the “Commercial Radio Enquiry”. That had enquired into a broadcasting practice colloquially referred to as “cash for comment”. The purpose of the disclosure standard was to require commercial radio licensees to ensure that whenever one of the station’s presenters mentioned the name of a sponsor, or its products or services, the presenter made a disclosure announcement about his or her commercial relationship with the sponsor. Radio 2UE had to comply with the disclosure standard because this was a condition of its commercial radio broadcasting licence by force of cl 8(1)(b) in Sch 2 of the Act.

3. There is no doubt that Mr Laws was fully aware of who his sponsors were and how much they were paying him on the occasion of each contravention.  But he did not comply with the obligations of Radio 2UE to make disclosure.  The parties prepared an agreed statement of facts which I will set out shortly.  They agreed that it was appropriate to suggest to the Court that a penalty of $10,000 per contravention should be imposed.  That would result in a total of $130,000 in civil penalties being payable by Radio 2UE.  The Authority and Radio 2UE suggested that these figures were appropriate to reflect a penalty at the lower end of the range having regard to all the circumstances, including Radio 2UE’s immediate co-operation with the Authority’s enquiry, its contrition and acceptance of responsibility for the contraventions.  In addition, Radio 2UE agreed to pay $20,000 in respect of the Authority’s costs. The maximum penalties were $55,000 per contravention or a total $715,000. 

4. Radio 2UE submitted that a number of matters should be seen as significant mitigating factors. It contended that, overall, its conduct warranted a conclusion that a penalty at the lower end of the range was appropriate, as the Authority had accepted. Radio 2UE relied on the evidence of Graham Mott and his conduct in support of its position. Mr Mott had been the group general manager for the Southern Cross Radio network from February 2003 to 8 November 2007 when it was taken over by Fairfax Media. Since 9 November 2007 he has been the group general manager of Fairfax Radio Network where he is responsible for managing the day to day operations of 28 radio stations and ensuring their compliance with, among others, financial and legal regulatory requirements. He has had over 40 years experience in radio broadcasting, gained largely at music and talk-back radio stations. Mr Mott was not cross-examined. I accept that he gave his evidence candidly and honestly. However, I must still weigh that evidence against the objective facts, the requirements of the Act and Radio 2UE’s licence. I also accept that Mr Mott, and through him Radio 2UE, intended that Radio 2UE would comply with the disclosure standard. But that compliance depended on its presenters’, and in particular, Mr Laws’, on-air behaviour.

5. When the matter was first listed for hearing, I was concerned that, as this was the first action for civil penalties under the Act, the relationship between the contravention and a commercial licence might involve different considerations than those in other situations permitting the imposition of civil penalties for contraventions of other legislation. Accordingly, I asked the parties to consider whether there ought be a contradictor. Both opposed that course. However, the Authority identified the Communications Law Centre as a body that might be an appropriate intervenor: see Australian Communications and Media Authority v Radio 2UE Sydney Pty Ltd [2009] FCA 214. Soon afterwards, the Centre sought to intervene. The Centre appeared by its director, Prof Michael Fraser, and he and each of the parties provided considerable assistance at the hearing.

   THE STATUTORY SCHEME

6. The objects of the Act are set out in s 3(1). They include:

   ·the promotion of the availability to audiences throughout Australia of a diverse range of radio and television services offering entertainment, education and information (s 3(1)(a));

   ·the provision of a regulatory environment that will facilitate the development of a broadcasting industry in Australia that is efficient, competitive and responsive to audience needs (s 3(1)(b));

   ·the promotion of the availability to audiences throughout Australia of television and radio programs about matters of local significance (s 3(1)(ea));

   ·the encouragement of providers of commercial and community broadcasting services “… to be responsive to the need for a fair and accurate coverage of matters of public interest and for an appropriate coverage of matters of local significance” (s 3(1)(g));

   ·the encouragement of providers of broadcasting services “… to respect community standards in the provision of program material” (s 3(1)(h)).

7. Significantly, the Act provides in s 4(1):

   “The Parliament intends that different levels of regulatory control be applied across the range of broadcasting services, data casting services and Internet services according to the degree of influence that different types of broadcasting services, data casting services and Internet services are able to exert in shaping community views in Australia.”  (emphasis added)

8. The Parliament also expressed its intention that the Authority be the body charged with the duty of regulating, relevantly, broadcasting services in a manner that, in its opinion, enabled public interest considerations to be addressed in a way that did not impose unnecessary financial and administrative burdens on providers of broadcasting services (s 4(2)(a)). The Act charged the Authority with responsibility for monitoring the broadcasting industry (s 5(1)(a)). The Act conferred on the Authority a range of functions and powers to be used in a manner that, in its opinion, would produce regulatory arrangements that were stable and predictable and would deal effectively with breaches of the rules established by the Act (s 5(1)(b)). And, in s 5(2) the Act provided that where it was necessary for the Authority to use any of the powers conferred on it by the Act to deal with a breach of the Act or regulations:

   “… the Parliament intends that the ACMA use its powers or a combination of its powers, in a manner that, in the opinion of the ACMA, is commensurate with the seriousness of the breach concerned.”

9. Radio 2UE held a public licence granted under the Act, namely, a commercial radio broadcasting licence. The licence was subject to a condition that the licensee comply with program standards applicable to the licence under Pt 9 of the Act (Sch 2, cl 8(1)(b)). Subclause 8(1)(b) of Schedule 2 provided:

   “8       Standard Conditions of Commercial Radio Broadcasting Licences

   (1)Each commercial radio broadcasting licence is subject to the       following conditions:

   …

   (b)the licensee will comply with program standards applicable to the licensee under Pt 9 of this Act.”

10. The disclosure standard was a program standard made applicable under Pt 9. Relevantly, s 139(3) of the Act provided that a commercial radio licensee that engaged in conduct that breached a condition of cl 8(1)(b) of Sch 2 was guilty of an offence and liable to a penalty of 500 penalty units.

    THE 2006 AMENDMENTS

11. In 2006 the Communications and Legislation Amendment (Enforcement Powers) Act 2006 (Cth) was enacted. It inserted s 140A into the Act. That expanded the powers of the Authority to deal with breaches of licences by arming it with powers to bring civil proceedings to recover a civil penalty. Thus, s 140A(3) provided:

    “(3)A commercial radio broadcasting licensee must not breach a condition of the licence set out in sub cl 8(1) of Schedule 2.”

1. The 2006 amendments also inserted s 205F. That provided that if the Federal Court is satisfied that a person has contravened a civil penalty provision, it may order the person to pay the Commonwealth a pecuniary penalty, known as a “civil penalty order” (s 205F(1) and (2)). Relevantly, s 205F(3) provides:

   "In determining the pecuniary penalty, the Federal 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."

2. The maximum pecuniary penalty payable in respect of a contravention of a civil penalty provision cannot exceed the maximum fine that could have been imposed had the person been convicted of an offence against the provision of the Act that corresponds to the civil penalty provision (s 205F(4)). A pecuniary penalty is a civil debt payable to the Commonwealth which it is entitled to enforce as a judgment debt (s 205F(8)). Only the Authority may apply for a civil penalty order (s 205G(1)).

3. The Authority also obtained the power to accept an enforceable undertaking. This is a written undertaking given by a person, among other things, to take specified action in order to comply with the Act (s 205W(1)(a)). Such an undertaking is enforceable under s 205X. The Authority may apply to this Court for, among others, orders requiring the person to comply with the undertaking, directing the person to pay to the Authority, on behalf of the Commonwealth, a sum up to the amount of any financial benefit reasonably attributable to the breach that the person obtained directly or indirectly and compensation (s 205X(2)).

4. The explanatory memorandum circulated by the Minister for Communications, Information Technology and the Arts in support of the Bill that became the 2006 amending Act explained the purpose of introducing the civil penalty and enforceable undertaking regime.  This was to complement the use of enforceable undertakings by providing further mid-range enforcement options for the Authority and industry to consider in the event that a breach had been committed.  One express purpose considered in the explanatory memorandum was a perceived deficiency in the Authority’s enforcement powers.  The explanatory memorandum said:

   “For example, the experience of the ACMA in its attempt to prosecute the licensee of commercial radio service 2UE for multiple breaches of the Broadcasting Services (Commercial Radio Current Affairs Disclosure) Standard 2000 indicates some of the difficulties confronted by the ACMA because of its limited enforcement powers.”

5. The 2006 amendments were intended to address the then lack of middle range penalties to deal with breaches of the Act, regulations and licences by adding to the Act the civil penalty and enforceable undertaking provisions. Such breaches were ones that did not warrant criminal sanctions, suspension or cancellation of a licence (see EM pars 14, 16). The explanatory memorandum referred to difficulties associated with criminal sanctions that had been highlighted following the Authority’s findings in December 2003 that Radio 2UE had committed 19 breaches of the disclosure standard. However, later, the Director of Public Prosecutions advised the Authority that on the evidence available there would be no reasonable prospect of a conviction of Radio 2UE in relation to those breaches. These breaches also involved Mr Laws.

6. The explanatory memorandum observed that suspension or cancellation of a licence was a severe penalty that affected consumers of the service as well as the broadcaster who could be expected to suffer significant economic loss as a consequence.  It noted that the Authority had never used this power in respect of breaches by commercial broadcasters. 

   THE DISCLOSURE STANDARD

7. The object of the disclosure standard was stated in cl 3 as being:

   ”… to encourage commercial radio broadcasting licensees to be responsive to the need for a fair and accurate coverage of matters of public interest by requiring the disclosure of commercial agreements that have the potential to affect the content of current affairs programs.”

8. The disclosure standard applied to all commercial radio broadcasting licensees who broadcast current affairs programs (cl 4).  The standard required, relevantly:

   ·on-air disclosure, during current affair programs, of commercial agreements between sponsors and presenters that had the potential to affect the content of those programs (cl 5(a));

   ·licensees to keep a register of commercial agreements between sponsors and presenters of current affairs programs and to make it available to the Authority and the public (cl 5(c));

   ·licensees to ensure that a condition of employment of presenters of current affairs programs is that they comply with relevant obligations imposed by, among other requirements, the standard (cl 5(d)).

9. The disclosure standard defined a “current affairs program” as a program that had a substantial purpose of providing interviews, analysis, commentary or discussion, including open line discussion with listeners, about current social, economic or political issues (cl 6).  Thus, the standard applied to “talk back radio”, where the presenter and callers speak on-air about current topics.  Additionally, the standard provided that a “commercial agreement” meant an agreement, arrangement or understanding:

   ·one of the purposes of which was that a presenter in exchange for any benefit or valuable consideration;

   -promoted a third party or its products, or services or interests;

   -refrained from making negative comments about a sponsor;  or

   -provided consultancy services in respect of publicity, promotion or public relations;  or

   ·which imposed obligations on a presenter to provide services in consideration of which the presenter or some service company, other than the licensee,  would receive more than $25,000 p.a..

   The standard defined “sponsor” to mean a party to a commercial agreement (other than a presenter) as well as the party or parties who were directly to benefit from the promotion or other services provided by the presenter.

10. For the purpose of these proceedings a critical obligation was contained in cl 7(1). That provided relevantly that:

    “(1)… a licensee must cause to be broadcast during a current affairs program a disclosure announcement at the time of and as part of:

    (a)a broadcast of any material in which the name, products or services of a sponsor are mentioned.”

    The disclosure announcement had to include at least one of the six phrases set out in cl 7(3), such as “[the name of the sponsor] … is a sponsor of mine”.

11. A licensee had to keep a register of current commercial agreements between sponsors and presenters of current affairs programs (cl 9(1)).  That register had to be available free of charge for public inspection and published on the licensee’s website (cl 9(2) and (3)).  The register had to identify details of each commercial arrangement, including specifying the value or benefit to be provided under it as either falling within one of three bands, $10,000 or less p.a., more than $10,000 but not more than a $100,000 p.a. or more than $100,000 p.a. (cl 10(5)).  Presenters had to disclose all commercial agreements to their licensee employer (cl 12).  And, cl 13 provided that a licensee had to require each presenter to comply with relevant obligations imposed on the licensee by, among other things, the disclosure standard.

12. The disclosure standard contemplated that a presenter would be able to earn remuneration directly from a third party.  Generally such a third party would be a person who could have advertised on the presenter’s employer’s radio station.  The licensee might lose the benefit of advertising revenue while the presenter used its licence to earn remuneration for himself or herself from the sponsor without accounting to his or her employer.  Moreover, unless the commercial agreement were disclosed on-air, listeners may not appreciate the true context for the presenter’s reference to his or her sponsor or their product or service, including any apparently favourable treatment.

13. The disclosure standard was intended to provide for transparency in broadcasting.  One important purpose was to enable a listener to judge whether a presenter’s reference to one of his or her sponsors was his or her genuine opinion, or simply something that he or she was being paid to say as if it were their genuine opinion.  It is patent how such a practice could mislead listeners into believing that the references made to sponsors, their products or services or opinions expressed by a presenter, instead of being an advertisement or potentially an advertisement, were the presenter’s opinion.  Thus, when a person telephones a talk back radio presenter of a current affairs program and discusses a particular product or service, mentioning a sponsor’s name, unless the presenter disclosed that he or she was being sponsored by that entity, the public discussion which would occur between the presenter and the caller would not be transparent.  After all, the presenter could select or pre-arrange for a caller who would mention the sponsor, product or service as part of the presenter’s commercial arrangement with the sponsor.

14. The chairman of the Authority, Chris Chapman, explained its reasons for commencing these proceedings in a media release.  Radio 2UE relied on the media release, its dissemination and its terms as evidence of harm to Radio 2UE’s reputation in respect of compliance and of its public denunciation in respect of the 13 contraventions (cf Ryan v The Queen (2001) 206 CLR 267 at 284-286 [52]-[59] per McHugh J, 303-304 [123] per Kirby J, 318-319 [177] per Callinan J). Mr Chapman said:

    “ACMA has taken the step of applying for civil penalty orders against 2UE, having earlier tried to address 2UE’s compliance failures through other means. These latest breaches occurred at a time when 2UE had given ACMA an enforceable undertaking to improve its performance, particularly in relation to the John Laws Morning Show....

    However, ACMA —and the Australian Broadcasting Authority before it— has emphasised in previous findings against 2UE that the obligation to comply with program standards lies with the licensee itself; in fact it goes to the heart of a licensee’s obligations.

    Broadcasting licences are not given out lightly by government and convey significant benefit to those to whom a licence is granted. It is a licensee’s unrelenting responsibility to manage its business, including its presenters and production staff, so as to ensure satisfactory compliance with the regulatory requirements.

    Company management put at real risk the retention of these licences when they allow on-air personalities or other staff to breach the rules. One consideration informing the Authority’s agreement to consenting to the civil penalty order was its assessment that Fairfax genuinely accepts that proposition.”  (emphasis added)

    THE PURPOSE AND SCOPE OF SS 140A AND 205F

15. The grant of the licence is a privilege to use the public resource of the radio spectrum. Abuse of the privilege, by breaching a condition of a licence, attracts liability under ss 139(3) and 140A(3). The primary purpose of s 140A(3) is to protect the public by holding licensees to the standard of conduct that their licence requires them to observe. The disclosure standard addresses a particular, and insidious, means of abusing the privilege of a commercial radio broadcasting licence. That standard recognised the significant degree of influence current affairs presenters could exert in shaping community views in Australia (see s 4(1)). The more prominent the presenter, the greater the potential he or she has to exert influence in shaping community views.

16. The spoken word is the vehicle used to shape views on radio current affairs programs.  The identity of the speaker, if known to the audience, can itself influence their receptivity to what he or she says;  as can the speaker’s oratorical style and manner of delivery.  And, because of its orality, publication in a radio broadcast conveys a transient message.  The listener may tune in or turn on the radio part way through a program;  he or she may have missed an earlier disclosure announcement by the presenter when  he or she returns to a topic that attracts an obligation to make such an announcement.  If it is not made, that new listener will not be aware of what the disclosure standard, and the licence, require be conveyed contemporaneously, namely the presenter’s sponsorship.  Additionally, listeners may not always be attentive to what is being broadcast on radio and may miss the significance, or indeed the occurrence, of an earlier disclosure statement in the same program.  That can affect the meaning which the listener understands to have been conveyed by what he or she hears the presenter saying later.  These characteristics of transient communications, such as radio or television broadcasts, are also recognised in the common law principles of defamation:  Amalgamated Television Services Pty Ltd v Marsden (1998) 43 NSWLR 158 at 165G-166E per Hunt CJ at CL, Mason P and Handley JA agreeing.

17. Thus, the transience both of what is spoken on-air during a radio broadcast and of the listening audience (who may tune in or out at any time and, when tuned in, may pay closer or lesser degrees of attention) underlie the policy behind the disclosure standard’s insistence on the presenter making a disclosure announcement contemporaneously each time one of his or her sponsor’s name, products or service is mentioned.

18. The liability in s 140A(3) corresponds to, but is distinct from the criminal liability imposed by s 139(3). The conduct proscribed by each section is the same, namely a breach of a condition of a licence set out in cl 8(1) of Sch 2, including a breach of the disclosure standard. But the objects of the two sections are not the same. One object of s 140A(3) is to create a civil, not criminal, liability so as to enable the Authority to secure compliance with important provisions in the Act more readily than through criminal proceedings. But another object of the section is to reinforce the norm of conduct for licensees in s 139(3) and to provide a means to enforce their compliance with it less drastic than the remedies existing before 2006.

19. The Parliament provided that the civil penalty could match the criminal penalty for the same conduct of a commercial radio broadcasting licensee in breaching a condition of its licence. However, the imposition of a civil penalty under s 140A(3) would not carry the stigma attached to a criminal conviction under s 139(3). And, pursuant to s 205K of the Act the civil penalty could be imposed after a trial using the civil onus of proof (see too s 140 of the Evidence Act 1995 (Cth)): see too Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Australian Competition and Consumer Commission (2007) 162 FCR 466 at 477-482 [19]-[38] per Weinberg, Bennett and Rares JJ.

20. A primary purpose of civil penalties is deterrence:  Trade Practices Commission v CSR Limited (1991) ATPR ¶41-076 at 52,152 per French J. Hence, in assessing the penalty to be imposed, a court will consider whether, in all the circumstances relevant to be taken into account (here under s 205F(3)), others would be deterred by the penalty and at the same time the licensee will be penalised or punished appropriately. The range of relevant matters under s 205F(3) ordinarily will include (borrowing from what French J suggested in CSR (1991) ATPR ¶41-076 at 52,152-52,153):

    ·the deliberateness of the contravention;

    ·whether the contravention occurred or arose out of the conduct of senior management or at a lower level;

    ·whether the licensee has a corporate culture conducive to compliance with the Act and standards as evidenced by educational programs and disciplinary or other corrective measures in response to an acknowledged contravention;

    ·whether the licensee has shown a disposition to co-operate with the Authority in discharge of its regulatory role under the Act.

21. The parties urged that no difference in approach to fixing an agreed civil penalty was called for under the Act as compared to the approach taken under legislation such as under s 76 of the Trade Practices Act 1974 (Cth) and s 42Y of the Therapeutic Goods Act 1989 (Cth). They relied on what Flick J had said in Secretary, Department of Health and Aging v Pagasa Australia Pty Ltd [2008] FCA 1545 at [17], [23]-[25]. He helpfully reviewed a large number of cases imposing civil penalties arising under a number of Acts: Pagasa [2008] FCA 1545 at [23]-[27], concluding at [27]:

    “Although the form of words set forth in other legislative provisions may be the same or comparable to those employed in the 1989 Act, the legislative mandate that the Court “must have regard to all relevant matters” in s 42Y(3) assumes obvious importance. It is that mandate which directs attention to those more specific matters which can only be discerned from an analysis of the 1989 Act itself. Of central importance in identifying those matters which are “relevant” — and which must therefore be taken into account — are the objects and purposes of the 1989 Act.”

22. I agree with Flick J’s approach to the construction of provisions like s 205F(3) of the Act. French J remarked in CSR (1991) ATPR ¶41-076 at 52,152 the other general objects of the criminal law apart from deterrence, namely retribution and rehabilitation, had no “… part to play in economic regulation of the kind contemplated by Pt IV” of the Trade Practices Act.

23. However, I am of opinion that other considerations arise under the Broadcasting Services Act. The purpose of regulation under the Act, including the imposition of civil penalties for contraventions of s 140A(3) under s 205F, must be gleaned from the detail of the provisions of the Act.

24. The common law recognises that its remedy of damages for tort includes, in addition to deterrence, punishment and condemnation of both the actual wrongdoer’s behaviour and the behaviour of another for whose conduct the defendant is answerable.  Those objects are, therefore, not exclusively a function of the criminal law.

25. In Lamb v Cotogno (1987) 164 CLR 1 at 8 per Mason CJ, Brennan, Deane, Dawson and Gaudron JJ cited with approval Pratt LCJ’s explanation in Wilkes v Wood (1763) Lofft 1 at 19 [98 ER 489 at 498-499] that exemplary damages are awarded “as a punishment to the guilty, to deter from any such proceeding for the future and as a proof of the detestation of the jury to the action itself”. The Court held in Lamb 164 CLR at 8-11 that the objects of an award of exemplary or punitive damages include:

    ·  punishment of a defendant;

    ·  deterrence of that defendant and others;  and

    ·  marking the Court’s condemnation of the defendant’s behaviour.

26. The fact that a defendant who is covered by compulsory third party motor vehicle insurance and so will not pay the sum awarded as exemplary damages from his, her or its own pocket, or that the defendant is the insurer, does not restrict the power of the court to award exemplary damages: Lamb 164 CLR at 11; Gray v Motor Accident Commission (1998) 196 CLR 1 at 12-13 [32]-[36] per Gleeson CJ, McHugh, Gummow and Hayne JJ, 29 [87] per Kirby J, 50 [141] per Callinan J.

27. And, in New South Wales v Ibbett (2006) 229 CLR 638 at 648 [38] Gleeson CJ, Gummow, Kirby, Heydon and Crennan JJ observed:

    “The common law fixes by various means a line between the interests of the individual in personal freedom of action and the interests of the State in the maintenance of a legally ordered society.”

1. When the Parliament adopted the well recognised device of a civil penalty as a remedy for contraventions of the Act, it did not exclude, expressly or by necessary implication, the Court from having regard to objects that are not exclusively criminal such as punishment or condemnation, in addition to deterrence: see too CEPU 162 FCR at 477-479 [19]-[28]. In Rich v Australian Securities and Investments Commission (2004) 220 CLR 129 at 146 [35] Gleeson CJ, Gummow, Hayne, Callinan and Heydon JJ said that classification of proceedings as protective or penal wrongly assumed that those two objects were mutually exclusive. They held that a law may bear several characters, as may proceedings that seek relief which, if granted, would protect the public and penalise the defendant.

2. Talk back radio and current affairs programs of the kind that Mr Laws had, occupy a significant place in commercial radio broadcasting.  Presenters of such programs can exert considerable influence in shaping community views.

3. In Victoria v Australian Building Construction Employees’ and Builders Labourers’ Union (1982) 152 CLR 25 at 98 as Mason J spoke of “… the overriding importance of freedom of discussion and speech”, adding “without information, there can be no meaningful discussion”: see too Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 139-140 per Mason CJ. It is now established that each member of the Australian community has an interest in disseminating and receiving information, opinions and arguments concerning government and political matters that affect the people of Australia. The duty to disseminate such information is the correlative of the interest in receiving it: Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 571 per Brennan CJ, Dawson, Toohey, Gaudron, McHugh, Gummow and Kirby JJ. The media fulfil a vital role in the ability of the Australian community and, in particular, electors to engage in the discussion of government and political matters, and ss 3 and 4(1) of the Act, in part, recognise this.

4. The disclosure standard was a key instrument to ensure transparency in current affairs radio broadcasting.  Failures to disclose could violate the public’s ability to trust in the quality and nature of information conveyed in programs such as Mr Laws’.  Unlike the regulation of economic behaviours provided in Pt IV of the Trade Practices Act, the Act creates the right to hold a licence but regulates the licensee’s exploitation of that right for its own benefit, by imposing limitations crafted in, and to secure, the public interest. A commercial radio broadcasting licence confers an economic privilege on a licensee exercisable in accordance with the Act, standards and the conditions of the licence. These important and distinct features of the Act were recognised in the extracts I have quoted from Mr Chapman’s media release.

5. For these reasons, I am of opinion that it is relevant to include, in the amount of a pecuniary penalty fixed under s 205F, in an appropriate case, some element of punishment of or retribution against, or stigmatisation of, a licensee which, in the course of conducting its business using the licence for its own profit, contravenes an important condition of the licence or the Act. The contravention of s 140A(3) by a failure to comply with the disclosure standard can amount to a violation of the public trust reposed in a licensee. As Mr Chapman tellingly said, the obligation to comply with that standard “… goes to the heart of the licensee’s obligations”.

6. Just as there is no single, correct sentence, so too there is no single, correct amount of a pecuniary penalty:  cp  Markarian v The Queen (2005) 228 CLR 357 at 371 [27] per Gleeson CJ, Gummow, Hayne and Callinan JJ. In arriving at an appropriate penalty, a court must give careful attention to the maximum provided for in the Act. The maximum invites comparison between the worst possible case and the case before the Court. And the maximum can provide a yardstick when balanced with the other relevant factors: Markarian 228 CLR at 372 [30]-[31].

7. In this respect, ordinarily the worst possible case for a civil penalty would not be equivalent to the worst possible case for a criminal penalty under the corresponding section in the Act. That is because, first, the purpose of the Parliament providing for the civil penalty was to enable the Authority to use that power to address conduct not warranting the use of the corresponding criminal provision or the suspension or cancellation of a licence. Secondly, if a person has been convicted of an offence (e.g. under s 139(3)) constituted by substantially the same conduct as attracts a civil penalty (e.g. under s 140A(3)) then s 205L prohibits the Court making a civil penalty order against that person. And, s 205M stays civil penalty proceedings if criminal proceedings have been or are later commenced in respect of substantially the same conduct. If the person is convicted, then s 205M(2) provides for the civil penalty proceedings to be dismissed, but the stay is lifted if the person is acquitted. Conversely, s 205N authorises criminal proceedings to be commenced in the opposite situation; i.e. after a civil penalty order has been made. This preserves the option of later prosecution where, for example further evidence has come to light showing that a more severe penalty is called for than that in the civil penalty order.

8. There is a prosecutorial discretion to bring criminal proceedings under s 205N.  Ordinarily, some enlivening factor must arise after the conclusion of the civil penalty order proceedings to warrant the initiation of the criminal proceedings so that they would not be seen as an abuse of process in light of the policy in ss 205L and 205M (e.g. if facts subsequently were discovered, casting a different light on an apparently middle range contravention for which a civil penalty was appropriate, prosecution might be warranted).

9. Where ss 205L or 205M apply, the apparent intention of the Parliament, was to exclude the use of the civil penalty order if criminal proceedings result in conviction.  This is because the stamp or, possibility, of the conviction has characterised the contravention (even if only temporarily so, pending the determination of the criminal proceedings) as of a more serious kind.  No doubt the civil penalty imposed would be relevant to the criminal penalty following conviction, where s 205N applies.  But, s 205N must be read harmoniously with the legislative policy reflected in ss 205L and 205M:  Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 381-382 [69]-[71] per McHugh, Gummow, Kirby and Hayne JJ.

   PRINCIPLES WHERE PARTIES AGREE THE APPROPRIATE PENALTY

10. The Parliament conferred power on the Court to impose and to determine the amount of any pecuniary penalty: s 205F(1), (3). For many years the Court has recognised the ability of parties to such proceedings to make a joint or agreed submission as to the civil penalties to be imposed for contraventions of legislation. Agreement as to the suggested result can be reached prior to the institution of the proceedings for civil penalties, as happened here. Ordinarily, there will be savings in time and public and private expense that can be expected from parties putting forward, in a responsible manner (as they have in these proceedings) agreed contraventions and suggested penalties.

11. The Court may reject the suggested penalty, and impose a different one.  But, in the ordinary case the use of this sensible approach will result in a speedy determination of the proceedings.  Such a consequence is obviously of considerable benefit to the community;  a lengthy and expensive trial and possibly an appeal or appeals are averted and a just penalty is imposed.  But there is another, very important benefit in the approach;  it gives the wrongdoer a degree of certainty and a speedy imposition of the penalty.  Where a result is uncertain, such as the outcome of a contested trial and the consequent penalty (whether a criminal sentence or the imposition of a civil penalty), it is all too human for a wrongdoer to procrastinate in the hope that something will work out favourably.  But if a wrongdoer (such as a person who contravenes a civil penalty provision in legislation) can have relative assurance that, however severe, an agreed penalty is likely to be imposed promptly, that degree of certainty is a powerful spur to action.

12. Ordinarily, the views of the Authority will be of significant weight in assisting the Court to fix an appropriate pecuniary penalty for a contravention of s 140A(3) of the Act. The Authority’s functions and role under the Act enable it to offer insight into the circumstances and impact of the contravention and the measures taken or proposed to guard against similar conduct in the future. And, one purpose of enacting the civil penalty provisions was to give the Authority access to a greater range of enforcement measures. Thus, its choice of remedy and the manner in which it ought be imposed are important factors to weigh in assessing the appropriateness of its suggested pecuniary penalties: cp NW Frozen Foods Ltd v Australian Competition and Consumer Commission (1996) 71 FCR 285 at 290G-291C, where Burchett and Kiefel JJ said:

    “Because the fixing of the quantum of a penalty cannot be an exact science, the Court, in such a case, does not ask whether it would without the aid of the parties have arrived at the precise figure they have proposed, but rather whether their proposal can be accepted as fixing an appropriate amount.

    There is an important public policy involved. When corporations acknowledge contraventions, very lengthy and complex litigation is frequently avoided, freeing the courts to deal with other matters, and investigating officers of the Australian Competition and Consumer Commission to turn to other areas of the economy that await their attention. At the same time, a negotiated resolution in the instant case may be expected to include measures designed to promote, for the future, vigorous competition in the particular market concerned. These beneficial consequences would be jeopardised if corporations were to conclude that proper settlements were clouded by unpredictable risks. A proper figure is one within the permissible range in all the circumstances. The Court will not depart from an agreed figure merely because it might otherwise have been disposed to select some other figure, or except in a clear case.”

13. Their Honours emphasised that the Court in such cases recognised that the selection of a penalty is not an exact science and that, as in the formation of other discretionary judgments, there will usually be a range of penalties that could be appropriate.  Generally, the Court does not undertake the exercise of fixing a penalty itself to assess whether it is prepared to give effect to the parties’ suggestion:  NW Foods 71 FCR at 291B-G.

14. The assessment of a pecuniary penalty that is appropriate, having regard to all relevant factors under s 205F(3) is, like a criminal sentence, the result of the “process of instinctive synthesis” described in Markarian 228 CLR at 373-374 [36]-[37] and Wong v The Queen (2001) 207 CLR 584 at 611-612 [74]-[76] per Gaudron, Gummow and Hayne. If what is suggested by the parties as an appropriate penalty is unreasonable or plainly unjust, the court can reject it on similar principles to those used when sentences are either manifestly excessive or inadequate: cf Markarian 228 CLR at 370-371 [25]; Lukatela v Birch (2008) 223 FLR 1 at 7 [25]-[26]. In Minister for Industry Tourism and Resources v Mobil Oil Australia Pty Ltd (2004) ATPR ¶41-993 at 48,632 [77] Branson, Sackville and Gyles JJ said:

    “Just as the criminal court will take into account the prosecution’s views on the appropriate sentence, so the court in the civil penalty case, as NW Frozen Foods explained, will take account of the regulator’s position. But in neither case is the court relieved from the responsibility of exercising its own judgment as to the appropriate sentence (in criminal cases), or whether the proposed penalty is within the appropriate range for the contravention (in civil penalty cases). In each case, the Court should be satisfied that it is being given accurate, reliable and complete information on critical questions.”

15. Their Honours had emphasised earlier in their reasons that in civil penalty proceedings the view of the regulator, as a specialist body, is a relevant but not determative consideration on the question of penalty, adding (Mobil (2004) ATPR ¶41-999 at 48,626 [51(iv)]):

    “In particular, the views of the regulator on matters within its expertise (such as the ACCC’s views as to the deterrent effect of a proposed penalty in a given market) will usually be given greater weight than its views on more “subjective” matters.”

16. In Australian Competition and Consumer Commissioner v Qantas Airways Ltd (2008) 253 ALR 89 at 107-108 [25]-[27] Lindgren J identified 11 propositions relating to the fixing of penalties under the Trade Practices Act as flowing from the decisions in NW Foods 71 FCR 285 and Mobil (2004) ATPR ¶41-993 (and these were recently applied by Jacobson J in Australian Competition and Consumer Commission v PRK Corporation Pty Ltd [2009] FCA 715 at [20]-[24]). These included the propositions that:

    ·the Court is not obliged to commence its reasoning with the level of the agreed penalty and limit itself to considering whether that penalty is within the range;  the Court is entitled to address the question independently at the outset of its reasoning;

    ·the admissions and agreed facts should not be approached as if they had been “tailored or modified to reflect the difficulties faced by the [regulator] in proving its case”;

    ·the regulator should always explain to the Court the process of reasoning said to justify a discounted penalty.

    THE STATEMENT OF AGREED FACTS

17. The statement of agreed facts dated 13 February 2009 tendered by the parties was as follows:

    “The parties agree to the following facts:

    1.The Applicant, the Australian Communications and Media Authority (ACMA), brings these proceedings under s 205F(1) of the Broadcasting Services Act 1992 (Cth) (Act) on behalf of the Commonwealth.

    2.At all material times, the Respondent, Radio 2UE Sydney Pty Ltd (2UE) was the holder of the commercial radio broadcasting licence numbered SL4102. 2UE has held this licence since circa 1940. It was last renewed on 23 August 2006 pursuant to s 47 of the Act.

    3.2UE's licence is subject to the conditions set out at Pts 2 and 4 of Sch 2 to the Act (see also ss 42(2) and 43 of the Act). Relevantly, Pt 4 of Sch 2 to the Act (which contains only one clause - cl 8) specifies the standard conditions of commercial radio broadcasting licences. It relevantly provides:

    8        Standard conditions of commercial radio broadcasting licences

    (1)Each commercial radio broadcasting licence is subject to the following conditions:

    …

    (b)the licensee will comply with program standards applicable to the licence under Part 9 of this Act;

    …

    The Disclosure Standard

    4.Following the findings published by ACMA's predecessor, the Australian Broadcasting Authority (ABA) in the Commercial Radio Inquiry in August 2000, on 21 November 2000 a program standard was made known as the Broadcasting Services (Commercial Radio Current Affairs Disclosure) Standard 2000 (Cth) (Disclosure Standard). It was made pursuant to Pt 9, s 125 of the Act. It commenced operation on 15 January 2001. It remains in force.

    5.The Disclosure Standard relevantly provides that a licensee must cause to be broadcast during a current affairs program a disclosure announcement at the time of and as part of a broadcast of any material in which the name, products or services of a sponsor are mentioned.  Each of the emphasised terms are defined by cl 6 of the Disclosure Standard.

    6.        At all material times:

    6.1."commercial agreements" (as defined by the Disclosure Standard) existed between John Laws and the following entities:

    •Balmoral Australia Pty Limited (holding company of Hamilton Island Enterprises Limited and Oatley Family Wines Pty Limited);

    •         Byron Bay Beverages Pty Ltd;

    •         Toyota Motor Corporation Australia Ltd;

    •         Roche Group Pty Ltd; and

    •         Qantas Airways Ltd.

    6.2.the entities named in paragraph 6.1 (including each of Hamilton Island Enterprises Limited and Oatley Family Wines Pty Limited ) were "sponsors" (as defined in the Disclosure Standard) of John Laws;

    6.3.John Laws was a "presenter" (as defined by the Disclosure Standard); and

    6.4.the John Laws Morning Show (Show) was a "current affairs program" (as defined by the Disclosure Standard).

    7.On 30 November 2007, the Show ceased to be broadcast on 2UE and John Laws retired and ceased to be an on-air presenter for 2UE.

    The Enforceable Undertakings

    8.On 31 August 2006, 2UE’s ultimate holding company, Southern Cross Broadcasting (Australia) Limited reported suspected breaches of the Disclosure Standard to ACMA which allegedly occurred on the Show.

    9.On 12 October 2006, ACMA commenced an investigation into 2UE's compliance with the Disclosure Standard and other programming standards.

    10.On 25 September 2007, ACMA published a report of its findings from the investigation (2007 Report) that ACMA had undertaken.  In that investigation ACMA found two (2) breaches of the Disclosure Standard by 2UE during a broadcast of the Show on 28 August 2006.  One (1) of those breaches of the Disclosure Standard involved a failure by 2UE to cause a "disclosure announcement" to be broadcast during the Show at the time of and as part of a broadcast of material in which the name, products or services of a sponsor of John Laws were mentioned. 

    11.After these findings were made 2UE offered ACMA an enforceable undertaking pursuant to s 205W of the Act, which ACMA accepted on 24 September 2007 (Enforceable Undertaking). 2UE undertook to do certain things in relation to its compliance with the Disclosure Standard, including:

    11.1. to implement an effective administrative system for monitoring each broadcast of the Show to ensure compliance with cl 7 of the Disclosure Standard. This is to include a mechanism to ensure that, in the event that a disclosure announcement (of the kind described in cl 7(3) of the Disclosure Standard) is not made, 2UE will:

    11.1.1.take action to cause such a disclosure announcement to be made at the earliest opportunity in that program; and

    11.1.2.report to ACMA in writing within 72 hours of such failure to comply with the Disclosure Standard providing details of the non-compliance and the action taken;

    11.2.to appoint an independent person to review at least four programs per fortnight of the Show, who will also prepare a report on compliance with cl 7 of the Disclosure Standard to ACMA within 14 days of each fortnight; and

    11.3.to provide ACMA with five half-yearly reports in accordance with a timetable set out in the Enforceable Undertaking, indicating what action 2UE has taken in the period covered to ensure that ACMA is notified as required by cl 11 of the Disclosure Standard of any additional commercial agreements or variations to commercial agreements, entered into by 2UE’s presenters or their associates.

    The Compliance Assessment Report

    12.Between December 2007 and October 2008, ACMA conducted a further investigation into 2UE's compliance with the Disclosure Standard (and the Enforceable Undertaking) and prepared a report, titled "Compliance Assessment Report - Radio 2UE Sydney Pty Ltd" (2008 Report) detailing its findings.

    13.      The 2008 Report details the following conduct by 2UE:

    13.1.at about 11.26am on 5 October 2007 no disclosure announcement was made that Hamilton Island Enterprises Ltd was a sponsor of John Laws at the time of an on-air mention of Hamilton Island;

    13.2.at about 11.40am on 5 October 2007 no disclosure announcement was made that Hamilton Island Enterprises Ltd was a sponsor of John Laws at the time of an on-air mention of Hamilton Island;

    13.3.at about 10.06am on 18 October 2007 no disclosure announcement was made that Byron Bay Beverages Pty Ltd was a sponsor of John Laws at the time of an on-air mention of Byron Bay Beer;

    13.4.at about 10.28am on 18 October 2007 no disclosure announcement was made that Byron Bay Beverages Pty Ltd was a sponsor of John Laws at the time of an on-air mention of Byron Bay bitter;

    13.5.at about 11.13am on 24 October 2007 no disclosure announcement was made that Toyota Motor Corporation Australia Ltd was a sponsor of John Laws at the time of an on-air mention of the Landcruiser;

    13.6.at about 11.14am on 24 October 2007 no disclosure announcement was made that Byron Bay Beverages Pty Ltd was a sponsor of John Laws at the time of an on-air mention of Byron Bay Beer;

    13.7.at about 10.10am on 24 October 2007 no disclosure announcement was made that Hamilton Island Enterprises Ltd was a sponsor of John Laws at the time of an on-air mention of Hamilton Island;

    13.8.at about 11.51am on 26 October 2007 no disclosure announcement was made that Hamilton Island Enterprises Ltd was a sponsor of John Laws at the time of an on-air mention of Hamilton Island;

    13.9.at about 11.21am on 2 November 2007 no disclosure announcement was made that Toyota Motor Corporation Australia Ltd was a sponsor of John Laws at the time of an on-air mention of Toyota;

    13.10.at about 9.53am on 30 November 2007 no disclosure announcement was made that the Roche Group Pty Ltd was a sponsor of John Laws at the time of an on-air mention of John and Imelda Roche and the Roche family;

    13.11.at about 10.21am on 30 November 2007 no disclosure announcement was made that Toyota Motor Corporation Australia Ltd was a sponsor of John Laws at the time of an on-air mention of the Toyota Hi-Lux;

    13.12.at about 11.14am on 30 November 2007 no disclosure announcement was made that Toyota Motor Corporation Australia Ltd, Qantas Airways Ltd, Byron Bay Beverages Pty Ltd and Oatley Family Wines were sponsors of John Laws at the time of on-air mentions of Toyota, Qantas, Byron Bay lager and Wild Oats wine (expressed to be four (4) separate contraventions, but dealt with by the ACMA in its investigation as one (1)); and

    13.13.at about 11.25am on 30 November 2007 no disclosure announcement was made that Toyota Motor Corporation  Australia Ltd was a sponsor of John Laws at the time of an on-air mention of Toyota,

    (together, Incidents).

    The Incidents

    14.In relation to each of the Incidents which were also identified at paragraphs 1.1 to 1.13 of the Application filed 26 November 2008 (Application) and reproduced at paragraph 13 above, 2UE admits:

    14.1.that the Incident occurred as described therein (and as described in the 2008 Report);

    14.2.that the incident constitutes a failure by 2UE to comply with cl 7(1)(a) of the Disclosure Standard which is a breach of a condition of 2UE's licence found in cl 8(1)(b) of Sch 2 to the Act; and

    14.3.that the breach of the condition in cl 8(1)(b) of the Act constitutes a contravention of a "civil penalty provision", being s 140A(3) of the Act.

    2UE's history of compliance with the Disclosure Standard

    15.Since the commencement of the Disclosure Standard, and prior to the investigation resulting in the 2008 Report, ACMA and its predecessor have undertaken the following relevant investigations:

    15.1.In November 2003 the ABA published a report of its finding following an investigation into breaches by 2UE of, amongst other things, the Disclosure Standard.  This report relevantly found that 2UE breached the Disclosure Standard on ten (10) occasions for failing to cause a disclosure announcement to be broadcast at the time a sponsor's a name was mentioned during the broadcast of the John Laws Morning Show.  It found a further nine (9) breaches of the Disclosure Standard for failing to broadcast a disclosure announcement in the prescribed form.  The ABA investigation found a further six (6) breaches of a separate requirement then in force that required the licensee to disclose, on air, the existence of "major commercial agreements”, being commercial agreements the value of which was greater than $100,000 per year.

    15.2.In September 2007 ACMA published the 2007 Report as detailed at paragraphs 9 to 11 above. 

    Fairfax/ 2UE's business

    16.In March 2001, 2UE was acquired from Broadcast Investment Holdings Pty Ltd by Tricom Radio Holdings Pty Ltd (now known as Fairfax Radio Network Pty Limited) which in turn was wholly-owned by Southern Cross Broadcasting (Australia) Limited.

    17.On 5 November 2007, a wholly-owned subsidiary of the Macquarie Media Group acquired Southern Cross Broadcasting (Australia) Limited.

    18.On 9 November 2007, Fairfax News Network Pty Limited, a wholly-owned subsidiary of Fairfax Media Limited, acquired Tricom Radio Holdings Pty Ltd (now known as Fairfax Radio Network Pty Limited), the parent company of 2UE.

    19.      In respect of the Incidents referred to in paragraphs 13 and 14 above:

    19.1.Four (4) Incidents relate to a period during which 2UE was ultimately owned by Fairfax Media Limited.  The remaining Incidents occurred prior to Fairfax Media Limited acquiring 2UE from Southern Cross Broadcasting (Australia) Limited; and

    19.2.Those four (4) Incidents occurred on John Laws’ last day as an on-air presenter for 2UE.

    20.      2UE will separately provide evidence of its financial position.

    Value of sponsorships held by John Laws

    21.The value to John Laws of the commercial agreements with each of the entities (or sponsors) listed at paragraph 6.1, per annum, were as follows:

    21.1.Balmoral Australia Pty Limited - more than $100,000 per annum;

    21.2.Byron Bay Beverages Pty Ltd - more than $10,000 but less than $100,000 per annum;

    21.3.Toyota Motor Corporation Australia Ltd - more than $100,000 per annum;

    21.4.Roche Group Pty Ltd - more than $100,000 per annum; and

    21.5.Qantas Airways Ltd - more than $100,000 per annum.

    Agreement between parties on appropriate penalty

    22.On or about 25 November 2008, ACMA and 2UE reached an agreement on what the parties regarded as an appropriate amount for 2UE to pay by way of a civil penalty order for each Incident in the 2008 Report.  The parties agreed that an amount of $10,000 in respect of each of the thirteen (13) breach findings in the 2008 Report would be appropriate.  ACMA and 2UE also agreed that 2UE would pay ACMA’s costs of the civil penalty proceedings fixed in the amount of $20,000. 

    23.The respective positions of the parties as regards this agreement will be set out in written submissions.

    Steps taken by 2UE following the Incidents

    24.Clause 4.2(b) of the Enforceable Undertaking requires 2UE to appoint an independent auditor who ACMA has approved to conduct five half-yearly audits to access 2UE’s compliance with the Broadcasting Services (Commercial Radio Compliance Program) Standard 2000 (Compliance Standard). The independent auditor has provided ACMA with 3 reports to date. The Independent Audit Reports states:

    24.1.2UE, in conjunction with its parent company, Fairfax Media, is currently undertaking a complete review of its compliance program, including manuals with a view to updating and improving the compliance policies and procedures and training sessions of staff of Fairfax Radio Network.  From 17 October 2008 to 20 January 2009, the Group General Manager of Fairfax Radio Network, Mr Graham Mott, acted in the position of Acting General Manager of 2UE and a new person was being recruited for that position.

    24.2.On about 28 January 2008 the Fairfax Radio Network appointed Ms Michelle Davies, Corporate Counsel for the Fairfax Radio Network, from the Fairfax Media Limited legal unit to ensure regulatory compliance by 2UE. 

    24.3.In February 2008, 2UE amended its monthly declarations in response to Part 3, the last paragraph on page 39 of the Report, to include a timeframe within which presenters must advise 2UE that the presenter has entered into a commercial agreement (or had amended an existing commercial agreement).

    24.4.In February 2008, the Group General Manager of Fairfax Radio Network issued a policy that all ACMA B55 forms, that are required to notify ACMA of a change to the Register of Commercial Agreements, be reviewed and approved by the Group General Manager of Fairfax Radio Network and the Corporate Counsel of Fairfax Radio Network prior to lodgement with ACMA.  This procedure ensures that we are aware of amendments to commercial agreements immediately and have the opportunity to review new commercial agreements.

    24.5.From May 2008, in addition to the 2UE General Manager, the Group General Manager of the Fairfax Radio Network and the Corporate Counsel of Fairfax Radio Network are required to review all commercial agreements when they are received from presenters.  This process is intended to ensure that no commercial agreement is misinterpreted.

    24.6.From May 2008, 2UE includes a copy of any document which purports to vary or amend a commercial agreement, with the commercial agreement.  This process is intended to ensure that 2UE is aware of any extension in the term of a commercial agreement.

    24.7.From May 2008, the Senior Officer (as appointed under the Compliance Program) reviews all commercial agreements, notwithstanding that the claimed consideration is less than $100,000.  This process is intended to ensure that all commercial agreements are disclosed in accordance with the Disclosure Standard.

    Capacity of 2UE to pay the penalty

    25.As stated in paragraph 18 above, the ultimate holding company of 2UE is Fairfax Media Limited, a company listed on the Australian Securities Exchange.  2UE has entered into a deed of cross guarantee with Fairfax Media Limited and thus has adequate provision for the payment of the agreed penalty and costs.

    Co-operation with ACMA

    26.2UE has co-operated with ACMA during the conduct of its investigation, which resulted in the preparation of the Report.  In particular, the parties note that:

    26.1.2UE complied with its obligation under paragraph 11.2 above.

    26.2.2UE has complied with its obligations under paragraph 11.3 above to date, except that the first report was provided by 2UE to ACMA on 7 December 2007, being 8 days after the due date of 29 November 2007.

    26.3.2UE and Fairfax Media Limited have at all times provided additional information to ACMA when requested by ACMA and have informed ACMA of the steps they have undertaken to improve their compliance program.

    Deterrence

    27.The Incidents referred to in the Application and the proposed penalty of $130,000 have been reported in news services, in particular in the radio industry, Australia-wide.  The resulting publicity surrounding the Incidents and the penalty that 2UE faces is expected to heighten awareness of the requirements of the Disclosure Standard throughout the commercial radio industry in Australia.”  (footnote references omitted)

    THE CONTEXT IN WHICH THE ENFORCEABLE UNDERTAKING WAS GIVEN

1. The background circumstances to the enforceable undertaking referred to in the agreed facts (at [8]-[11]) involved a previous substantial failure of Mr Laws to make proper disclosure of his sponsorship arrangements. This background is relevant for the purposes of determining the pecuniary penalty under s 205F(3) of the Act.

2. Early in his program on Monday 28 August 2006, Mr Laws referred to the Commonwealth Government’s decision announced the previous Friday that it would sell shares in Telstra.  Telstra was a sponsor of Mr Laws.  During the course of that day’s program Mr Laws interviewed the then Prime Minister concerning the Telstra share sale, invited listeners to participate in a web poll on Mr Laws’ own website, read out emails from listeners and discussed with callers the proposed sale.  The program lasted 3 hours, but at no stage did Mr Laws make a disclosure statement concerning his commercial agreement with Telstra.  This is the event referred to in [10] of the agreed facts.  Although that description referred to one breach of the disclosure standard of a failure to make a disclosure announcement.  Mr Chapman’s media release of 26 November 2008 announcing the commencement of these proceedings said that the Authority had found that Radio 2UE had breached the disclosure standard 20 times during that broadcast.  And, the transcript of the program and other evidence supports Mr Chapman’s description.

3. On 31 August 2006, Radio 2UE’s holding company wrote to the Authority drawing Mr Laws’ breaches of the disclosure standard to its attention.  That letter informed the Authority that Radio 2UE was considering terminating Mr Laws’ contract.  This was the event in [8] of the agreed facts.  Around this time Mr Laws went on annual leave and returned to air on Tuesday 26 September 2006.

4. On 7 September 2006 Mr Mott together with, Tony Bell, the managing director of Southern Cross Broadcasting, Adam Olding, Southern Cross Broadcasting’s director of corporate affairs and general counsel and Radio 2UE’s then general manager, Simon Rufhus, met with senior counsel.  Senior counsel advised them verbally that Mr Laws’ conduct did not entitle Radio 2UE to terminate his contract and that if it did so it would be likely to be in breach of contract itself.  Senior counsel warned that that could expose Radio 2UE to liability for very substantial damages and that Mr Laws may also be able to assert an entitlement to “equitable remedies”.  Mr Mott said that based on this advice Radio 2UE considered that it could not terminate Mr Laws’ contract until a court determined that he had materially breached it.  Mr Mott said that the contract did not contain a provision that allowed Radio 2UE to suspend or stand down Mr Laws.

5. The second reading of the Bill for the 2006 amendments occurred in the Parliament on 14 September 2006.  Mr Ruhfus, wrote to Mr Laws on 25 September 2006.  Mr Ruhfus drew Mr Laws’ attention to extracts from a transcript of the program of 28 August 2006.  He continued, referring to a clause of Mr Laws’ contract with Radio 2UE that:

   “… requires compliance with … the obligations imposed on 2UE pursuant to ‘the Standards’ which includes the Disclosure Standard.  The requirements of the Disclosure Standard have been raised and explained to you on numerous occasions, including as recently as 22 May 2006 when you were provided with personal training in relation to the Disclosure Standard by Adam Olding, the General Counsel of Southern Cross Broadcasting. …

   This company is at a loss to understand why you failed to make the disclosure announcement as required by the Disclosure Standard.

   As a consequence of your failure 2UE has failed to comply with the Disclosure Standard.  This is a serious matter for this company.  The issue is currently before the Australian Communications and Media Authority.

   This company does not yet know what the consequences of your failure may bring from the Authority, nor indeed what may flow from activities of observers of this company’s radio station who operate in the public arena.  There may well be unfavourable consequences for this company.
   
   

   To say that this company is very seriously concerned about your failure and about its possible consequences would be an understatement.”  (emphasis added)

6. The letter set out the clause in Mr Laws’ contract giving Radio 2UE the right to terminate it if his conduct caused Radio 2UE to be in breach of a condition of its licence or the disclosure standard (cl 7.4(d)).

7. On the same day, Mr Ruhfus and Mr Olding had a telephone discussion with Mr Laws who was in Hong Kong returning home from an overseas trip.  They told Mr Laws about the breaches and reiterated the requirements of the disclosure standard.  They told him that legislation was before the Parliament to give the Authority more power to prosecute breaches of the disclosure standard by imposing fines and enforceable undertakings.  Mr Laws told them that he understood the nature of his obligations under the disclosure standard and that his failures on 28 August were “simply an oversight”.  He then asked if Mr Rufhus and Mr Olding were threatening to treat his conduct as a breach of contract.  Mr Olding’s file note recorded that Mr Laws “… said if we did so he’d walk”.  Mr Laws also referred to the disappointment he would feel if Radio 2UE did that after all his years of loyal service.

8. Mr Rufhus and Mr Olding also had a discussion on 25 September 2006 with Mr Laws’ production team and re-emphasised the need for them to ensure compliance with the disclosure standard.  They told the team of their concern about the nondisclosure.  The team members indicated that they were either busy with other tasks and had not heard the broadcast of Telstra’s name or had heard it but failed to prompt Mr Laws to make a disclosure statement due to oversight.

9. In late October 2006, the Authority began an investigation of the breaches.  Southern Cross Broadcasting informed the Authority that Mr Laws had indicated that he was aware of the requirements of the disclosure standard and that his failure to comply was an oversight.

10. Mr Mott met with Mr Laws in late November 2006 and discussed compliance with the standards,in particular the disclosure standard.  Mr Laws said to Mr Mott that he was aware of the requirements of the disclosure standard and was “… doing everything possible to comply with them”.

11. On 14 March 2007 Mr Mott wrote to Mr Laws informing him that since 4 February 2007 the Act had been amended (i.e. by the 2006 amendments) so that the Authority had additional enforcement powers including the power to seek civil penalty orders and to accept enforceable undertakings. Mr Mott wrote that the imposition of a civil penalty would be a matter of grave concern to Radio 2UE and would bring it into disrepute. He said his purposes in writing were to remind Mr Laws of his contractual obligation to comply with the standards made under the Act, to notify him formally of the Authority’s new powers and to inform him that Radio 2UE would consider its rights under their contract with him should he fail to comply with the standards. Mr Mott noted that the Authority’s investigation into the 28 August 2006 breaches was continuing and his letter was not a waiver of Radio 2UE’s rights. He wrote that he wanted to highlight to Mr Laws how seriously Radio 2UE regarded compliance with the standards. Mr Mott added:

    “In light of previous compliance difficulties, I thought it was important to highlight the changes to the legislation and confirm our views on this issue.”  (emphasis added)

12. During the next two days Mr Laws met with Mr Mott twice to discuss the letter.  Mr Mott told Mr Laws that any further breaches of the disclosure standard would be unacceptable to Radio 2UE.  He said that Radio 2UE had a right to terminate the contract for a breach of Mr Laws’ obligation to comply with the standards and, if such a failure occurred it would consider its rights.  After the second conversation Mr Mott flew to Melbourne to report to Mr Bell on his discussions with Mr Laws.

13. On 11 May 2007 the Authority provided Mr Bell with a draft report on its investigation of the 28 August 2006 breaches and, pursuant to the Act, afforded Southern Cross Broadcasting with an opportunity to comment. South Cross Broadcasting responded to the draft report on 28 May 2007.

14. Around the beginning of June 2007, Mr Laws informed Mr Bell, of his intention to retire from on-air presenting.  Mr Laws met with and told Mr Mott of this on 6 June 2007.  They agreed that Mr Laws’ last day on-air would be 30 November 2007.  Under the contract, Mr Laws could retire on giving 6 months notice and this date would coincide with the end of the calendar year season in the industry, which would allow sufficient time to arrange for Mr Laws’ replacement in an orderly way.  Mr Mott also agreed to this period of notice because Mr Laws also had not committed any further breaches of the disclosure standard since 28 August 2006.  He gained confidence from this that Mr Laws was taking his obligations to make disclosure announcements seriously and had reformed.

15. On a number of occasions Mr Mott suggested to Mr Laws that he should disclose his commercial agreements simply and in a positive way.  He told Mr Laws that by mentioning a sponsor or their product and then making a disclosure statement in a negative manner, the negativity reflected back onto the sponsor or their product.  Mr Mott formed the view from these discussions that Mr Laws genuinely accepted that he was doing a disservice to the sponsors by being negative when making disclosure statements.

16. Mr Laws expressed the view to Mr Mott on a number of occasions between 14 March 2007 and 6 June 2007 that on-air presenting had become harder over the previous few years largely as a result of the obligations placed on him by the disclosure standard.  Mr Mott believed from his meetings and conversations with Mr Laws after 28 August 2006 that the pressure which he and other senior executives in Southern Cross Boadcasting, including Mr Bell and Mr Olding had exerted on him in respect of his history of non-compliance with the disclosure standard, had played some part in his decision to retire.  On 25 June 2007, Mr Laws announced on his program that he was retiring from on-air presenting.

    THE CONTEXT IN WHICH RADIO 2UE FAILED TO CAUSE COMPLIANCE BY MR LAWS

17. On 3 July 2007 Southern Cross Broadcasting agreed conditionally on the sale of its radio network to Fairfax Media.  Mr Mott said that Southern Cross Broadcasting considered itself to be in a caretaker role of the parts of its commercial radio network that were to be sold pending completion of that acquisition in early November 2007.

18. On 24 September 2007, Radio 2UE gave an enforceable undertaking to the Authority pursuant to s 205W of the Act. The enforceable undertaking contained a specific obligation to monitor Mr l\Laws’ program in cl 4.1, including the following terms:

    “4.1     Compliance with the Disclosure Standard

    (a)       Monitoring of the John Laws Morning Show

    Within two weeks of the commencement of this undertaking, 2UE will implement an effective administrative system for monitoring each broadcast of the John Laws Morning Show to ensure compliance with section 7 of the Disclosure Standard.  The system will include a requirement that, in the event that a disclosure announcement of the kind described in section 7(3) of the Disclosure Standard is not made in accordance with section 7(1) of the Disclosure Standard, 2UE will take action to cause such a disclosure announcement to be broadcast at the earliest opportunity in that program, and will report in writing to ACMA within 72 hours of such failure to comply with the Disclosure Standard, providing details of the non-compliance and of the action taken.

    (b)       Independent review of the John Laws Morning Show

    Within two weeks of the commencement of this undertaking, 2UE will appoint an independent person to review at least four programs per fortnight of the John Laws Morning Show.  The first fortnight will commence on the Sunday following the commencement of this undertaking.  2UE will provide recordings of the programs to the independent person and, if requested by the independent person or ACMA, provide transcripts of those recordings.  The independent person appointed will prepare a report on compliance with section 7 of the Disclosure Standard, based on the review of the programs.  The independent person appointed will provide a copy of each report to ACMA within 14 days of the end of each fortnight.”

19. Thus, the enforceable undertaking specifically addressed the past shortcomings of Radio 2UE, through its presenter, Mr Laws, in making disclosure announcements that Radio 2UE was required to make. It had to “implement an effective administration system for monitoring each broadcast” of Mr Laws’ program to ensure compliance with cl 7 of the disclosure standard.

20. Next, on 25 September 2007, the Authority published its report on the 28 August 2006 breaches.  The findings that report would make when published had led to Radio 2UE giving its enforceable undertaking.  Radio 2UE had to monitor Mr Laws’ program under cl 4.1(a) from 1 October 2007.  It appointed an independent reviewer on 4 October 2007.

    THE CIRCUMSTANCES OF THE 13 CONTRAVENTIONS

21. The contraventions concerned the following valuable commercial agreements that Mr Laws had with his sponsors. (I have used the numbering of the order of the contraventions set out in [13] of agreed facts in these reasons.)

    ·Contraventions 1, 2, 7, 8 and 12 involved Balmoral Australia Pty Limited.  It had a commercial agreement with Mr Laws for more than $100,000 p.a.

    ·Contraventions 5, 9, 11, 12 and 13 involved Toyota Motor Corporation Australia Limited.  It had a commercial agreement with Mr Laws for more than $100,000 p.a.

    ·Contravention 10 involved Roche Group Pty Limited.  It had a commercial agreement with Mr Laws for more than $100,000 p.a.

    ·Contravention 12 also involved Qantas Airways Limited.  It had a commercial agreement with Mr Laws for more than $100,000 p.a.

    ·Contraventions 3, 4, 6 and also 12 involved Byron Bay Beveridges Pty Limited.  It had a commercial agreement with Mr Laws that was for more than $10,000 but less than $100,000 p.a.

22. Contravention 1 involved Mr Laws mentioning a sponsor on-air but failing to make a disclosure announcement until 90 seconds later in the broadcast.  Contravention 6 involved a caller, on Mr Laws’ talkback radio session, mentioning a sponsor on-air and then Mr Laws failing to make a disclosure announcement until 10 minutes later in the broadcast.

23. The independent reviewer described contraventions 5 and 6 in her report of 26 October 2007 as follows:

    “In one Toyota mention at 11:13am on Wednesday October 24^th, a caller mentioned Toyota and said John should ring the bell.  John did ring the bell but failed to declare Toyota as sponsors of his.

    In the same incident at 11:13am on Wednesday October 24^th John Laws rang the bell when a caller mentioned Byron Bay Beer but did not declare his sponsorship agreement.  Ten minutes later at 11:33am,[sic] obviously reacting to prompting John said “did I say Byron Bay Beer are sponsors of mine?  I think I did” followed by a rant about being monitored.”  (emphasis added)

24. None of the other 11 contraventions resulted in a disclosure announcement being made at all on the day of the broadcast.  Contraventions 2, 4, 5, 7, 8, 11 and 12 also involved callers who made an on-air mention of a sponsor during a talkback radio session in Mr Laws’ program.  Contravention 8 occurred on Friday 26 October 2007 at 11.51 a.m. in a segment of Mr Laws’ program called “The Best of the Lawsy Week”.  On that occasion a recording of contravention 7 taken from the previous Wednesday’s program, was replayed.  That segment, I infer, was a collection of recordings from earlier in the week that Mr Laws, or those producing his program, considered sufficiently memorable or significant that they were repeated.  Thus, whoever chose to repeat contravention 7 was reckless about the disclosure standard.  This was not a mere failure of the internal monitor or Mr Laws.  Rather, it demonstrated the absence of any real understanding within those responsible at Radio 2UE for compliance on Mr Laws’ program with the disclosure standard.  Contravention 8 should never have occurred because it was part of a pre-recorded segment that had been chosen for repetition.

25. In the case of contraventions 7 and 8, a disclosure announcement of sorts relating to them was broadcast on 29 October 2007 at approximately 9.11am when Mr Laws said the following:

    “Remember ‘Stormin’ Norman’ last week?  Norman was the caller that rang us on Wednesday howling against just about everything we do on this program.  He didn’t like my alleged bias … I don’t know what bias he referred to … he didn’t like the fact that I’d been reasonably successful and he didn’t like the fact that I’m an ambassador for Hamilton Island.  As you know Hamilton Island are sponsors of mine and I think in the heat of the moment … maybe we didn’t mention that the other day, but of course we live in this environment of total terror and we have to say that Hamilton Island are sponsors of mine in order to appease the Nazis and also to appease the terrified management of this broadcasting station.  I hope you are now all duly appeased.  We can get on with our lives.  At least just for four more weeks, JUST LEAVE ME ALONE (cuts to music).”  (emphasis in the Authority’s report)

26. It is obvious from the above extract, that Mr Laws had been told he had failed to make a disclosure announcement and had been required to make the disclosure later.  I will return to the content of that statement below.  In fact, Mr Ruhfus had written to the Authority late in the afternoon of 26 October 2007, the day of the broadcast on which contravention 8 occurred, drawing its attention to Mr Laws’ failure to make a disclosure.  I do not consider that statement to have been sufficiently close in time to have any palliative effect.

27. The final contravention (13) occurred at approximately 11.25 am on Mr Laws’ last 35 minutes of presenting before his retirement was to occur.  He had just finished talking to the well known singer, Normie Rowe, who had mentioned Byron Bay Beer.  Mr Laws said:

    “And of course I’ve got to say Byron Bay Beer are sponsors of mine.”

    As shown in the Authority’s report, Mr Laws then went on to say:

    “How bloody stupid.  When are you people going to get over it?  Never?  What are you going to do next week when you don’t have to sit around and listen to me all day in case I say Toyota? [pause]  Oh did you hear that, Alice?  He said Toyota!  God!  Boring old bastards! 13 13 32 is our telephone number. [pause]  No, not our people here, the people at the … whatever you call it, what do you call it?  ACMA.  As I said yesterday, it sounds like a skin ailment.”

    THE SUBMISSIONS

28. The Authority submitted that it expected that the proposed declarations, pecuniary penalties and costs order would assist in raising awareness of the disclosure standard throughout the commercial radio broadcasting industry in Australia and contribute generally to deterrence from similar conduct by licences.  In addition, the parties submitted that those orders would be a specific deterrent to Radio 2UE.  The joint submissions addressed a number of issues, and these were elaborated upon or supplemented by further submissions of each of the parties and the Centre.

29. In determining a pecuniary penalty under s 205F(3) the Court is not confined to considering any of the four particular matters referred to in subparagraphs (a) – (d). Rather, as the chapeau to s 205F(3) provides, the task is to “have regard to all relevant matters”. There is a degree of overlap in the considerations relevant to s 205F(3)(a) and (c). It is not easy to segregate a matter as being wholly within one or the other of those two subparagraphs. In my opinion it is not necessary to make any bright line segregation, so long as any matter which is itself relevant is considered in accordance with s 205F(3).

    1.   Public interest considerations

1. In arriving at the appropriate pecuniary penalties to be imposed for multiple contraventions, a court must first assess individual penalties for each contravention.  But, before finalising the civil penalty orders the Court must look at and, if need be, adjust the resulting total effect of the individual orders it is considering, so as to produce an overall set of civil penalty orders appropriate to deal with all the contraventions.  In other words, the totality principle applicable in passing criminal sentences should be adapted to apply to the overall civil penalty orders imposed on a contravenor:  Mill v The Queen (1988) 166 CLR 59 at 62-63 per Wilson, Deane, Dawson, Toohey and Gaudron JJ, applied in a civil penalty context by Stone and Buchanan JJ in Mornington Inn (2008) 168 FCR at 408 [91]; see too at 397-398 [42]-[45]; see also per Gyles J who dissented in the result but not on the principle’s applicability at 386-387 [5]-[9]. Where contraventions are separate offences in law but are substantially contemporaneous and connected, the Court must have regard to the totality principle in fixing the individual penalties: L Vogel & Sons Pty Ltd v Anderson (1968) 120 CLR 158 at 168 per Taylor, Menzies and Owen JJ. The Court must also have regard to the relative closeness of the relationship in time and character of the offences (or contraventions): Mill 166 CLR at 64.

2. Some aspects of the totality principle are not as easily applied to pecuniary penalties as to sentences of imprisonment using the method preferred in Mill 166 CLR at 63. The High Court suggested its preference for making sentences wholly or partially concurrent, where practicable, to reflect the appropriate overall punishment in the ultimate total result rather than lowering individual sentences below what would otherwise be appropriate to reflect the fact that a number of sentences were being imposed: Mill 166 CLR at 63; RH McL v The Queen (2000) 203 CLR 452 at 457 [15]-[16], 462-464 [32]-[34] per Gleeson CJ, Gaudron and Callinan JJ, 476 [75] per McHugh, Gummow and Hayne JJ; see too Lukatela 223 FLR at 15-16 [75]-[77] where I discussed the principle. Concurrent pecuniary penalties cannot be imposed. So the Court must consider the overall burden imposed by the set of pecuniary penalties to assess whether, in totality, the burden is greater that is warranted by the contraventions in all of the circumstances: see too s 205F(3). In fixing the penalties below I have had regard to the totality principle as explained above.

   FIXING THE PENALTIES

3. I am satisfied by the confidential evidence of Mr Mott that Radio 2UE is a substantial company in its own right and is capable of paying any penalty which the Court might impose.  In addition, Radio 2UE has entered into a deed of cross guarantee with its ultimate holding company, Fairfax Media Limited, and thus has adequate resources with which to pay any penalty in the whole range and costs.

4. I have also had regard to the significant advertising revenues of Radio 2UE, disclosed in Mr Mott’s confidential evidence, in forming the view that Mr Laws must have been valuable to Radio 2UE.  Mr Laws was obviously a presenter on whom Radio 2UE relied on to attract to attract audiences and advertising review.  He had over 50 years exposure and experience of public broadcasting.  I find that Mr Laws attracted a significant proportion of its total advertising revenue earnings, having regard to what he himself earned and Mr Mott’s evidence that he was the station’s presenter with the most commercial agreements.  The Authority’s report in respect of the 13 contraventions identified Byron Bay Beer and Toyota Motor Corporation Australia Limited as advertisers on Radio 2UE as well as sponsors of Mr Laws.  There was no evidence that the other sponsors, the subject of the contraventions also advertised on Radio 2UE.

5. The imposition of a civil penalty is, like the imposition of a sentence, a matter of instinctive synthesis. Here, there are no guides other than the subject matter, scope and purpose of the Act and the disclosure standard to use in ascertaining the object of imposing pecuniary penalties under s 205F. The public interest in ensuring that a commercial radio broadcasting licensee adheres to the conditions of their licence is of great importance. The repeated and substantial breaches by Radio 2UE as a licensee, should not be treated with a benign punishment. I am of opinion that having regard to the cumulatively damaging features of the repeated contraventions, civil penalties for most of them in a higher range than that chosen by the parties are the only ones which would appropriately meet the justice of the case.

6. Radio 2UE took no action at all on Mr Laws’ last day.  The failure to institute a proper system earlier led to the continuing and serious breaches by Radio 2UE of the conditions of its licence.  But, Mr Laws’ conduct itself was the central element of the contraventions.  Any system is only as good as its weakest part.  Mr Laws was a known recidivist.  The independent reviewer detected his initial two breaches and reported them in time to enable preventative steps to be taken before 24 October 2007.  Even then, Radio 2UE was aware of contraventions 7 and 8 by 26 October 2007 and reported them to the Authority.  Yet there was no evidence of what steps it took then, after becoming aware that its internal monitor had failed to prevent, first, the initial contravention, let alone its republication, as had its training of Mr Laws and his production staff.  And, Radio 2UE was aware, at least constructively, from the independent reviewer’s report of contraventions 5 and 6 involving Mr Laws’ “rant” and the inappropriate, seething resentment in his 29 October “disclosure” that, he treated the disclosure standard with contempt.

7. The pecuniary penalties must put a price on the contraventions that is sufficiently high to deter repetition by Radio 2UE as the contravenor and by others who might be tempted to contravene the Act and the disclosure standard: see CSR (1991) ATPR ¶41-076 at 52,152 per French J. I am of opinion that there will be a substantial deterrent effect given to licensees by the penalties I will impose. The kind of contraventions that Mr Laws caused Radio 2UE to make and its inadequate attention to the requirements of compliance must be deterred if the purpose of the disclosure standard is to be upheld.

8. I am satisfied that there will not be a repetition of Mr Laws’ conduct only because he has retired from presenting his program on Radio 2UE.  Radio 2UE has not had to deal with or test whether Mr Laws would now comply under its new measures.  However, I am also satisfied that Radio 2UE has implemented genuine and satisfactory changes to its compliance systems that are likely to lead to compliance by its other presenters. And, I am also satisfied that no bad faith was involved on the part of Radio 2UE’s management or Mr Mott. 

9. Licensees must be deterred from taking lackadaisical attitudes to compliance with their statutory and licence obligations. Takeovers and changes of control in ownership occur on a fairly regular basis in the broadcasting industry. Such events are not an excuse for a licensee to fail to comply with the Act, the disclosure standard or its licence. If Mr Mott and all the senior management were too busy to protect the very basis which generated Radio 2UE’s entitlement to earn income, namely its licence, then a clear message must be sent by condign penalisation of that attitude. Such an attitude is unacceptable. It demonstrates an inattention to the public trust in commercial radio broadcasting licensees.

10. The privilege of being able to use the public radio spectrum cannot be allowed to be abused in the way that occurred here.  The history and circumstances of the contraventions call for the Court to make clear how important licensees must regard the privilege which their licence gives them and the heavy responsibilities imposed by their licences if they are to continue to benefit by exploiting a public right.  Under s 205F(3), I have had regard to all relevant matters, including, but not limited to the nature and extent of the contraventions, the mitigating factors put before me and particularly the circumstances in which they took place. 

11. Because this is the first time in which a civil penalty has been considered in the context of the Act, I have given anxious consideration as to whether I should, despite my views, accept the submissions of the parties as to the appropriate range. For the reasons I have given, the considerations for imposing a civil penalty under the Act include but are not limited to those in the contexts of other legislation. The purposes for imposing civil penalties under legislation such as the Trade Practices Act are different. They involve contraventions of laws of general application by persons engaged in trade or commerce. Here, under the Act, the contraventions attracting liability to the imposition of a civil penalty involve the breach by a licensee of conditions of a licence granted by law to engage in activity for profit. The licensee is in a position of public trust.

12. I have taken into account the mitigating factors that Radio 2UE and the Authority have referred to in their submissions and evidence. I accept that Radio 2UE, since the contraventions came to light, has co-operated with the Authority and genuinely regrets its conduct. However, the penalty must punish the significant breaches of public trust that occurred. In addition, Radio 2UE did not ensure that the new system was working after it gave the enforceable undertaking. No explanation has been given why Mr Ruhfus did not learn of the contraventions (other than contraventions 7 and 8) or of what he did to satisfy himself, as general manager of Radio 2UE, that it was, through Mr Laws, complying with the Act, the disclosure standard and the enforceable undertaking. I have not punished Radio 2UE for breach of the enforceable undertaking. But its existence, the circumstances in which it was given and its proximity in time to the contraventions should have ensured that someone in Radio 2UE checked whether the new compliance system actually worked. It is an aggravating factor that no adequate steps were taken by Radio 2UE, even in that context, to check or ensure that the new system was working.

13. A licensee cannot assume that nothing will go wrong. Far less could Radio 2UE have assumed this with Mr Laws who, after all, had been the cause of giving the enforceable undertaking. Radio 2UE had a duty to be vigilant to ensure compliance with its licence, the disclosure standard and the Act. Instead, Radio 2UE committed the contraventions when it permitted Mr Laws to use its licence knowing that, first, Mr Laws had a history of previous contraventions of the disclosure standard (cp Weininger 212 CLR at 640 [32] per Gleeson CJ, McHugh, Gummow and Hayne JJ), secondly, he had an antipathy to the disclosure standard, thirdly, he had six very substantial commercial agreements and, fourthly, he made frequent references during his program to his sponsors, their products and services. But for Radio 2UE’s mitigating conduct, I would have imposed higher penalties for these serious breaches.

14. Rather than making declarations, I consider that it is appropriate to state each contravention and the pecuniary penalty I have imposed for it in the formal orders.  The Authority, licensees and the public will be able to relate the two together in that way.

15. In my opinion, these contraventions should be marked with severe and substantial pecuniary penalties. The agreed penalties are, overall, but with the three exceptions I have noted, manifestly inadequate, indeed, negligible. To be sure, the Parliament intended that ss 140A and 205F would be a means of dealing with contraventions not calling for more severe sanctions such as suspension of a licence or its cancellation. The Chairman of the Authority aptly described the obligation to comply with the disclosure standard as going to the heart of a licensee’s obligations.

16. Having had regard to all relevant matters under s 205F(3) of the Act, I am of opinion that the following penalties should be imposed:

Date	Contravention	Penalty
5 October 2007	1	$   10,000
5 October 2007	2	$   10,000
18 October 2007	3	$   20,000
18 October 2007	4	$   20,000
24 October 2007	5	$   25,000
24 October 2007	6	$   25,000
24 October 2007	7	$   30,000
26 October 2007	8	$   45,000
2 November 2007	9	$   35,000
30 November 2007	10	$   10,000
30 November 2007	11	$   35,000
30 November 2007	12	$   45,000
30 November 2007	13	$   50,000
Total	$ 360,000

I certify that the preceding one hundred and eighty-five (185) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Rares.

Associate:

Dated:        17 July 2009

Counsel for the Applicant:	D Godwin
Solicitor for the Applicant:	Australian Government Solicitor
Counsel for the Respondent:	R A Dick
Solicitor for the Respondent:	Holding Redlich
Solicitor for the Intervenor:	Professor M Fraser

Dates of Hearing:	20 February, 6, 20 March 2009
Date of Judgment:	17 July 2009

SCHEDULE

Contravention 1:          Friday 5 October 2007, approx 11.26am. No disclosure announcement was made that Hamilton Island Enterprises Ltd was a sponsor of Mr Laws at the time of an on-air mention of Hamilton Island.

Facts

Mr Laws was interviewing Meredith Whittle, the mother of a child who was assisted by the Starlight Foundation. Towards the end of the interview Mr Laws said:

“It’s a terrific thing that you have done, and the Starlight Foundation, and I’m glad that they supported you and you must let us know if we can help you in any way. I mean I’m here for a little while yet…have you been to Hamilton Island?.. Do you want to go to Hamilton Island?”

Mr Laws ended the interview without making a disclosure announcement and the interview was followed by a commercial for Hughes Clothing Company.

Directly after the commercial at 11:28, approximately 90 seconds after the mention, Mr Laws says: ‘I did tell you that Hamilton Island are sponsors of mine, didn’t I?

Contravention 2:Friday 5 October 2007, approx 11:40am. No disclosure announcement was made that Hamilton Island Enterprises Ltd was a sponsor of Mr Laws at the time of an on-air mention of Hamilton Island.

Facts

A caller, ‘Andrew’, referred to the interview forming part of contravention 1 and said:

“I’ve been listening for the last seven years…particular little stories and things like the thing you just did for that last lady, sending her off to Hamilton Island. You know, it’s what brightens your day up…you know, we’re going to miss that when you go, really miss that.”

Mr Laws replied: ‘I’ll miss doing it believe me’ and did not disclose the sponsorship. No disclosure announcements for this sponsor were made for the rest of the program.

Contravention 3:          Thursday 18 October 2007, approx 10:06am. No disclosure announcement was made that Byron Bay Beverages Pty Ltd was a sponsor of Mr Laws at the time of an on-air mention of Byron Bay Beer.

Facts

Mr Laws read an email from a listener and said: ‘You also go on to say here, Des, I can’t find Byron Bay Beer anywhere in Central Victoria. Do they sell it in my state?’ Mr Laws commented on the email but there was no disclosure announcement regarding his sponsorship agreement with Byron Bay Beverages Pty Ltd.

Mr Laws had conducted a live-read commercial about Byron Bay Premium Ale at 9:59am, immediately before the 10am news and station advertisements.

Contravention 4:          Thursday 18 October 2007, approx 10.28am. No disclosure announcement was made that Byron Bay Beverages Pty Ltd was a sponsor of Mr Laws at the time of an on-air mention of Byron Bay Beer.

Facts

Mr Laws was talking to a caller, ‘Mark’, who, after saying: ‘…we’re halfway through a fantastic, doing it really tough holiday on Hamilton Island’ then said: ‘I’m disappointed about the fact that I can’t find Byron Bay bitter in the fridge at the bottle shop down here’. Shortly after this statement Mr Laws said: ‘We’ll see what we can do. But enjoy Hamilton Island. As you know they are sponsors of mine…’ and very soon after concluded the call. Although Mr Laws made a disclosure announcement for Hamilton Island, there was no disclosure announcement for the Byron Bay Beverages Pty Ltd sponsorship during the conversation with Mark.

Prior to the conversation with Mark, Mr Laws had broadcast a live-read commercial for Byron Bay Premium Ale at 9:59am. The 10:28am conversation with Mark was followed by station advertisements, a 15-minute interview with singer James Blunt and station advertisements that finished at 10:50am. There was no disclosure announcement during this period for Byron Bay Beer.

Contravention 5:          Wednesday 24 October 2007, approx 11:13am. No disclosure announcement was made that Toyota Motor Corporation Australian Ltd was a sponsor of Mr Laws at the time of an on-air mention of the Toyota Landcruiser.

Facts

Mr Laws spoke to a caller, ‘Greg’. During that call, Greg invited Mr Laws to his town in western New South Wales. Greg said.’…we’d like nothing better to, and I’m going to have to ask you to ring your RM Williams bell, to load up the Landcuriser with our esky and our snags…’ Mr Laws replied: ‘Good on you. Let me ring the bell’. A cow bell was sounded.

Mr Laws rang the cow bell after the mention of ‘Landcruiser’.

No disclosure announcement was broadcast for Toyota at that time or at any other time during the rest of the call. At 11.19am, Mr Laws conducted a 90 second live-read commercial for Toyota cars and the Warren Toyota Dealership.

Prior to contravention 5, Mr Laws had made an earlier disclosure announcement. He spoke to a caller, ‘Heath’, at 10.43am (about half-an-hour before the conversation with Greg). Heath mentioned his ‘new Hi-Lux’. Mr Laws then rang the cow bell and said: ‘They’re sponsors of mine, Toyota, as you know.’ Mr Laws did the same thing about 45 seconds later when he said: ‘….we got a Toyota watch there we’ll send Heath. Good lad, kept his belt buckle and kept on buying Toyotas [cow bell sounds] and you’re right, they’re sponsors of mine’.

Contravention 6:          Wednesday 24 October 2007, approx 11.14am. No disclosure announcement was made that Byron Bay Beverages Pty Ltd was a sponsor of Mr Laws at the time of an on-air mention of Byron Bay Beer.

Facts

Mr Laws spoke to a caller, ‘Greg’ (continuing the conversation that led to contravention 5). During the call, Greg invited Mr Laws to his town in western New South Wales. Greg said: ‘And, as I said, if you’d like to bring some of your Wild Turkey or your Byron Bay beer and, or what have you’. Mr Laws replies ‘Got to ring the bell again’ and the sound of a cow bell is heard. Caller Greg said: ‘I’m sorry, I should have mentioned all those [sponsors] before we started…’

Ten minutes later in the program, at about 11.33am, Mr Laws made a disclosure announcement for the caller Greg and his mention of Byron Bay Beer by saying: ‘Did I say Byron Bay Beer are sponsors of mine? I’m sure I did. I say it in my sleep. Anyway, they’re sponsors Greg. I’ll send you a case. Get Greg’s address. I did say Qantas are sponsors of mine because I say it in my sleep’.

Contravention 7:          Wednesday 24 October 2007, approx 10.10am. No disclosure announcement was made that Hamilton Island Enterprises Ltd was a sponsor of Mr Laws at the time of an on-air mention of Hamilton Island.

Facts

Mr Laws spoke to a caller, ‘Norman’. Norman said: ‘You go to Hamilton Island, you come back, then you go on holidays…’ Mr Laws replied: ‘That’s what really, really [expletive deleted] you off, that I go to Hamilton Island….Do you want to go to Hamilton Island, Norman?..’ Although Norman appeared to be an abusive caller, Mr Laws and Norman conversed for some time.

No disclosure announcement relating to Hamilton Island Enterprises was broadcast. Norman mentioned Hamilton Island again, but no disclosure announcement was made then or at the end of the call with Norman. No disclosure announcement was broadcast for Hamilton Island for the rest of that hour of the program.

On 26 October 2007 at 5:27pm Mr Ruhfus faxed a letter to the Authority reporting contraventions 7 and 8.

Contravention 8:          Friday 26 October 2007, approx 11.51am. No disclosure announcement was made that Hamilton Island Enterprises was a sponsor of Mr Laws at the time of an on-air mention of Hamilton Island.

Facts

In a segment called “The Best of the Lawsy Week” the full conversation Mr Laws had with Norman on Wednesday 24 October (see contravention 7) was replayed. Radio 2UE did not cause a disclosure announcement to be broadcast following the replay.

Contravention 9:          Friday 2 November 2007, approx 11.21am. No disclosure announcement was made that Toyota Motor Corporation Australia Ltd was a sponsor of Mr Laws at the time of an on-air mention of Toyota.

Facts

Mr Laws spoke to a caller, ‘Les’. Les identified himself as a long-time listener and said: I’m also a Toyota owner as well.’ Mr Laws replied: ‘Oh hang on [cow bell is sounded], I’ll ring the bell…Find something for Les, he’s a Toyota man, and a good one. And as I’ve said [implying a disclosure announcement] but…so I won’t say it again will I?’

About 14 minutes later Mr Laws was speaking to a caller, ‘Susuan’: said: ‘and you can ring the bell because I’ve just bought an Aurion ZR6 Sportivo [cow bell sounds] and I love it’. Mr Laws replied: ‘Isn’t it a great vehicle? I rang the bell because Toyota are sponsors of mine, I say with pride’.

A few seconds later, Mr Laws finished the call with Susan and, after arranging that she be sent a Toyota ladies watch, said: ‘….and I suppose after all that I better [cow bell sounds] tell you that they’re sponsors of mine.’ Those disclosure announcements did not relate to back to the conversation with Les concerning Toyota.

Contravention 10:        Friday 30 November 2007, approx 9.53am. No disclosure announcement was made that the Roche family was a sponsor of Mr Laws at the time of an on-air mention that was directly favourable to the sponsor.

Facts

Mr Laws was reading a number of farewell emails, including: ‘…we send to you and Caroline our fondest love for many continuing, fulfilling and happy years, and trust that we will continue to meet in friendship in the years ahead.’ Mr Laws then said: ‘That’s Bill and Imelda – that’s the Roche family who are wonderfully kind, kind people….’ No disclosure announcement was made for the Roche sponsorship.

The Authority found that, as direct beneficiaries of the promotional services provided by Mr Laws under a commercial agreement with the Roche Group Pty Ltd (the Roche family are majority owners of the company), the Roche family was ‘sponsors’ within the meaning of cl 6 of the disclosure standard.

Contravention 11:        Friday 30 November 2007, approx 10.21am. No disclosure announcement was made that Toyota Motor Corporation Australia Ltd was a sponsor of Mr Laws at the time of an on-air mention of Toyota Hi-Lux.

Facts

Mr Laws spoke to a caller, ‘Rebecca’. Rebecca said: ‘…I’m actually driving a Toyota Hi-Lux at the moment and just riding talking to all the farmers. Every single one of them has you playing on the radio at the moment.’ Mr Laws said: ‘Isn’t that nice? That’s very nice. How old are you, Rebecca?’

No disclosure announcement was broadcast during or at the end of the call. Mr Laws went onto another caller.

Contravention 12:        Friday 30 November 2007, approx 11.14am. No disclosure announcement was made that Byron Bay Beverages Pty Ltd, Toyota Motor Corporation Australia Ltd, Qantas Airways Ltd and Oatley Family Wines were sponsors of Mr Laws at the time of an on-air mention of Byron Bay lager, Toyota, Qantas and Wild Oats Wine.

Facts

Mr Laws spoke to Channel ten weatherman Tim Bailey. Mr Bailey said:

“You have got your own personal chimpanzee-like weatherman. Any time you want a forecast to go to lunch, you’ve got one. Any time you might want to know it is right to be flying OS or are we going to take Caroline up the Hunter? Or put her on the boat? You ring me, you get a personalised forecast for free, Lawsy. Did I say for free? Well I mean we can work something out with some Wild Turkey, Byron Bay larger, maybe a Toyota, some Wild Oats, a Qantas flight, but I am your personal forecaster for free mate.”

Mr Laws replied: ‘It’s a pleasure, Tim. You’re a good fella. I’ll see you soon.’ Mr Laws did not make a disclosure announcement for any of the 5 sponsors mentioned by Mr Bailey.

Contravention 13:        Friday 30 November 2007, approx 11.25am. No disclosure announcement was made that Toyota Motor Corporation Australia Ltd was a sponsor of Mr Laws at the time of an on-air mention of Toyota.

Facts

Mr Laws had just finished talking to the singer Normie Rowe who had mentioned Byron Bay Beer. Mr Laws said, ‘And of course I’ve got to say Byron Bay Beer are sponsors of mine’. Mr Laws went on to say:

“How bloody stupid. When are you people going to get over it? Never? What are you going to do next week when you don’t have to sit around and listen to me all day in case I say Toyota? [pause] Oh did you hear that? Did you hear that, Alice? He said Toyota! God! Boring old bastards! 13 13 32 is our telephone number. [pause] No, not our people here, the people at the….whatever you call it, what do you call it? ACMA. As I said yesterday, it sounds like a skin ailment.”