Commissioner for Consumer Affairs v Goros (No 2) - [2023] SASC 1

Supreme Court of South Australia
(Civil)
COMMISSIONER FOR CONSUMER AFFAIRS v GOROS & ANOR (No 2)
[2023] SASC 1
Judgment of the Honourable Chief Justice Kourakis
TRADE AND COMMERCE - COMPETITION, FAIR TRADING AND CONSUMER PROTECTION LEGISLATION - CONSUMER PROTECTION
TRADE AND COMMERCE - COMPETITION, FAIR TRADING AND CONSUMER PROTECTION LEGISLATION - ENFORCEMENT AND REMEDIES - PENALTY
TRADE AND COMMERCE - COMPETITION, FAIR TRADING AND CONSUMER PROTECTION LEGISLATION - ENFORCEMENT AND REMEDIES - PENALTY - PECUNIARY PENALTIES: QUANTUM AND LIKE MATTERS
CORPORATIONS - MANAGEMENT AND ADMINISTRATION - DUTIES AND LIABILITIES OF OFFICERS OF CORPORATION - DISQUALIFICATION FROM MANAGEMENT OF CORPORATION - BY COURT ORDER
TRADE AND COMMERCE - COMPETITION, FAIR TRADING AND CONSUMER PROTECTION LEGISLATION - ENFORCEMENT AND REMEDIES - INJUNCTIONS
TRADE AND COMMERCE - COMPETITION, FAIR TRADING AND CONSUMER PROTECTION LEGISLATION - CONSUMER PROTECTION - MISLEADING OR DECEPTIVE CONDUCT OR FALSE REPRESENTATIONS
The first respondent is the sole director, secretary and shareholder of the second respondent, a company which provided demolition and waste removal services. Throughout 2016, the respondents coerced consumers into paying additional fees to remove and dispose of asbestos contaminated material in circumstances where there was no, or in one demolition, an unsubstantial amount, of asbestos on site.
On 23 September 2022, this Court made declarations that each of the respondents had contravened the Australian Consumer Law (ACL) by, inter alia, making false and misleading representations, wrongly accepting payment, and engaging in unconscionable conduct contrary to sections 29(1), 36(1) and 21(1) of the ACL, respectively.
Subsequently, the applicant made submissions on penalties and costs. There was no appearance for the respondents.
Held:
1.The Court makes compensatory orders in respect of each of the consumers who made payments in accordance with Appendix A.
2.The Court imposes, pursuant to s 224 of the ACL, pecuniary penalties on the first respondent of $20,000, $20,000, $25,000, $20,000, $40,000, $25,000, $40,000 and $25,000 in respect of his contraventions of the provisions of the ACL against each of the consumers Mr Berry, the Cvorkovs, Ms Ho, Mr Ji, Mr Penna, Mr Masters, Dr Ahmed and Mr and Mrs Nazari, respectively.
3.The Court imposes, pursuant to s 224 of the ACL, pecuniary penalties on the second respondent of $40,000, $40,000, $50,000, $40,000, $80,000, $50,000, $80,000 and $50,000 in respect of its contraventions of the provisions of the ACL against each of the consumers Mr Berry, the Cvorkovs, Ms Ho, Mr Ji, Mr Penna, Mr Masters, Dr Ahmed and Mr and Mrs Nazari, respectively.
4.The first respondent is disqualified from managing a corporation for a period of 10 years commencing on this day pursuant to s 248 of the ACL.
5.The first respondent is restrained from making a representation, in the course of providing demolition or waste removal or storage services, that a building, or buildings or other waste, does, or may, contain hazardous material pursuant to s 232 of the ACL.
6.The first respondent is restrained from claiming or receiving any payment for the purported supply of demolition or waste removal or storage…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2023] SASC 1
Decision Date: 18 January 2023

CaseChat Overview and Summary

The matter before the court involved the Commissioner for Consumer Affairs acting against a party named Goros. The dispute arose from allegations of misleading or deceptive conduct under consumer protection legislation, and the court was tasked with determining the appropriate penalties and remedies, including potential disqualification from managing a corporation. The court was also asked to consider an injunction to prevent further breaches of the legislation.

The primary legal issues before the court were the determination of appropriate penalties for the misleading or deceptive conduct, the quantum of any pecuniary penalties, and whether there were grounds for disqualifying Goros from managing a corporation. Additionally, the court needed to decide whether an injunction should be issued to prevent future breaches of the consumer protection laws.

The court found that Goros had engaged in misleading or deceptive conduct, which was contrary to the provisions of the consumer protection legislation. The court imposed a pecuniary penalty on Goros, carefully considering the factors relevant to the quantum of the penalty, including the gravity of the offence, the need for deterrence, and the potential impact on Goros. The court also decided that Goros should be disqualified from managing a corporation, reflecting the seriousness of the breach. Furthermore, the court granted an injunction to prevent any future breaches of the consumer protection laws, ensuring that Goros would be unable to continue with the misleading or deceptive conduct.

The final orders of the court included the imposition of a specified pecuniary penalty on Goros, a disqualification order preventing Goros from managing a corporation, and an injunction prohibiting Goros from engaging in any misleading or deceptive conduct in the future. These orders were designed to enforce compliance with consumer protection laws and to provide a deterrent against similar breaches by others.

Orders