Commissioner for Consumer Protection v Healy
[2011] WASC 36
•14 FEBRUARY 2011
COMMISSIONER FOR CONSUMER PROTECTION -v- HEALY [2011] WASC 36
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2011] WASC 36 | |
| 14/02/2011 | |||
| Case No: | CIV:2472/2009 | 6 OCTOBER 2010 & 1 NOVEMBER 2010 | |
| Coram: | KENNETH MARTIN J | 6/10/10 | |
| 19 | Judgment Part: | 1 of 1 | |
| Result: | 20 days imprisonment suspended for 12 months | ||
| B | |||
| PDF Version |
| Parties: | COMMISSIONER FOR CONSUMER PROTECTION ALWYN ROBERT HEALY |
Catchwords: | Contempt Undertakings received by court Six transgressions proven Penalty Late refund of consumers' deposits by contemnor |
Legislation: | Nil |
Case References: | Chief Executive Officer of the Department of the Environment and Conservation v Szulc [2010] WASC 195 Thomson Australian Holdings Pty Ltd v Trade Practices Commission (1981) 148 CLR 150 Wood v Staunton (1996) 86 A Crim R 183 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- Plaintiff
AND
ALWYN ROBERT HEALY
Defendant
Catchwords:
Contempt - Undertakings received by court - Six transgressions proven - Penalty - Late refund of consumers' deposits by contemnor
Legislation:
Nil
Result:
20 days imprisonment suspended for 12 months
(Page 2)
Category: B
Representation:
Counsel:
Plaintiff : Mr G D Cobby
Defendant : In person
Solicitors:
Plaintiff : Jason L Derby
Defendant : In person
Case(s) referred to in judgment(s):
Chief Executive Officer of the Department of the Environment and Conservation v Szulc [2010] WASC 195
Thomson Australian Holdings Pty Ltd v Trade Practices Commission (1981) 148 CLR 150
Wood v Staunton (1996) 86 A Crim R 183
(Page 3)
- KENNETH MARTIN J:
(This judgment was delivered extemporaneously on 6 October 2010 and has been edited from the transcript.)
1 The (plaintiff) Commissioner's amended chamber summons raises six alleged transgressions as contempts in respect of undertakings offered by the defendant Mr Healy and received by the Court, on 19 November 2009. The terms of Mr Healy's undertakings are set out in par 1 of the chamber summons under a heading, Particulars of Contempt.
2 Five components of Mr Healy's undertakings, given at court through Mr Healy's counsel were, first (1.1) to restrain Mr Healy from representing to any person that any residential air-conditioning system that he, or any entity subject to his control, proposes to supply to that person, or to any other person nominated by that person, has both cooling and heating functions, when the system will not possess both those functions at the time that the system is installed.
3 The second undertaking (1.2), was that within two working days of entering into a contract for the supply of a system to any person (referred to as a customer), Mr Healy would order and pay for all parts necessary for the supply and installation of a complete system.
4 The third undertaking (1.3) was that Mr Healy would respond to all inquiries from customers within 48 hours of the inquiry being made.
5 His fourth undertaking (1.4) was that within 24 hours of becoming aware of any circumstances that would prevent Mr Healy from being able to supply the system on the date specified in the contract for the supply of that system, Mr Healy would inform the customer of the reason he would not be able to supply the system on the date specified in the contract, and the date on which the system would be or will be installed.
6 The last (1.5) of the undertakings was that if the supply and installation of a system sold to a customer not be completed within 14 days of the date specified in the contract for the supply of the system, Mr Healy would refund in full to the customer all monies received from the customer, such refund to be made within 48 hours of that 14 day time limit being exceeded.
7 A number of preliminary matters may be observed in respect of the undertakings. First is that undertakings do not necessarily require a written contract. The plaintiff's particulars of alleged breach or
(Page 4)
- transgression (sought to be punishable by the sanction of contempt of court) contend for written contracts in the case of the consumers Mr van der Westhuizen, Mrs Penn and Mr Sumah Shepherd. In respect of the McCarthys, it is the Commissioner's contention that the customer's contract was oral. But there is nothing in any of Mr Healy's undertakings to suggest that they were limited just to written consumer contracts. In my assessment the undertakings apply to any contract with a consumer entered by Mr Healy, be it an oral contract, a partly-written partly-oral contract, or a contract in writing. To the extent that it is argued by Mr Healy that there was no written contract entered with the McCarthys – I reject that contention as raising any potentially relevant defence.
8 Second, the Commissioner relied upon a series of affidavits from the aggrieved consumers, seeking to prove (beyond reasonable doubt) elements of six distinct contempts that Mr Healy is alleged to have committed. In respect of deponents whose affidavits became exhibits 1 to 5, (they being the affidavits, respectively, as exhibit 1, of Catherine Mary McCarthy, Deon van der Westhuizen, exhibit 2, Sumah Shepherd, exhibit 3, Merilyn Lee Penn, exhibit 4 and Jason Lloyd Derby, exhibit 5), all such material was received without challenge or cross-examination from Mr Healy. I therefore accept this evidence as essentially uncontradicted and reliable affidavit evidence.
9 Third, there were three documents tendered (as exhibit 7) during evidence given in person by Mr Andrew Peter Wright, a supplier of air-conditioning components, through his corporation Polyaire. Mr Wright gave evidence to explain written records which show that Polyaire only received orders in respect of a Derby outdoor ducted component for an air-conditioner and a Derby indoor ducted component for an air-conditioner on 9 December 2009. This document was generated by an order placed, the subject of the third document in exhibit 7, on 6 December 2009 from a customer. The customer of Polyaire that Mr Wright identified was Aircon Factory Direct, a corporation associated with Mr Healy.
10 That evidence is relevant to an aspect of the contempts alleged against Mr Healy, in that his second undertaking was that within two working days of entering into a contract for the supply of a system, Mr Healy would order and pay for all parts necessary for the supply and installation of a complete system.
11 Mr Wright's evidence was not otherwise challenged. I accept his evidence as reliable and accurate - establishing a failure by Mr Healy to
(Page 5)
- order and pay in accordance with this undertaking (ie within two working days).
12 The only affidavit deponent (providing evidence on behalf of the Commissioner) who was required at court for questioning by cross-examination by Mr Healy, was Mr Robert Anthony McCarthy. His affidavit became exhibit 6. He was then questioned by Mr Healy.
13 Essentially a series of questions were put to Mr McCarthy seeking to establish a technical point. The point was that although Mr Healy's undertakings were given and received by the court on 19 November 2009, essentially a perfected contractual relationship with Mr McCarthy as the customer had already been entered into - before 19 November 2009. So therefore, it was suggested that this consumer relationship with the McCarthys was entered too early to be covered by the subsequent undertakings of Mr Healy.
14 In circumstances where the Commissioner contends for only an oral contract between Mr Healy and the McCarthys, Mr Healy's cross-examination sought to suggest that a contractual relationship had been already perfected - earlier than 27 November 2009. Mr Healy's point was that if a contractual relationship was established earlier during October 2009, the McCarthy arrangements were not the subject of the undertakings.
15 Mr McCarthy's affidavit was consistent with all his responses given in answer to Mr Healy's questions during cross-examination. Essentially, the position was that Mr McCarthy would have liked to have committed to the earlier purchase of an air-conditioning system from Mr Healy in about October 2009, but he did not then have the available funds to do so. In October 2009, Mr McCarthy had made application for a loan which was not yet approved. He was taking a stance with Mr Healy that until he had his loan approved, and the money was in his hand, so to speak, he was not prepared to make any commitment with Mr Healy to acquire an air-conditioning system.
16 I find Mr McCarthy adopted the prudent course. On his evidence, which I fully accept, he did not give Mr Healy any 'go-ahead', in terms of (verbally) committing to an acquisition of the Derby brand air-conditioning refrigerated system, until 27 November 2009. Mr Healy's 19 November 2009 undertakings therefore are, I find, very much applicable to the transaction with the McCarthys.
(Page 6)
17 Mr McCarthy's evidence was that he paid a 50% deposit of $3,300, see pars 15 and following of his affidavit. In summary, Mr McCarthy was provided with Mr Healy's bank details. On 27 November 2009, he transferred $3,300 by an electronic funds transfer to Mr Healy's nominated bank account. That day he also sent a text message to Mr Healy to advise that the funds transfer had been completed. Mr McCarthy appends to his affidavit a copy of his bank records confirming this.
18 Later the same day, 27 November 2009, Mr McCarthy says he received a phone call, during which Mr Healy used words to him to the effect, 'I have received the funds in my account'. Mr Healy, as recollected by Mr McCarthy, then said these words, 'The installation date will be 16 December 2009'.
19 Pausing at that point, I am completely satisfied, for the purposes of my assessment of Mr Healy's compliance with the undertakings as given to the court on 19 November 2009, that all these words were spoken by Mr Healy on 27 November 2009. Therefore, the relevantly nominated installation date for the McCarthys' air-conditioning system, was 16 December 2009.
20 Accordingly, by undertaking (1.2), within two working days of 27 November 2009 Mr Healy should have placed an order for the parts necessary for supply and installation of a complete system for the McCarthys. Manifestly, by reference to documents I have mentioned produced during the evidence of Mr Wright, the relevant ordering by Mr Healy for the McCarthys' system did not happen within two working days of 27 November 2009. At the earliest, I find it occurred on 6 December 2009.
21 Mr McCarthy continues (par 21):
On 14 December 2009, I called Healy again to confirm the installation date but could not raise him. I left messages on his home, mobile and 1300 number. I have not received a return call from Healy, and the last time I spoke to Healy was when I phoned him on or about 7 December 2009.
22 At par 22:
Healy did not supply and install our air-conditioner on 16 December, or at any time thereafter. I have heard nothing further from him since.
(Page 7)
23 At par 23, Mr McCarthy concluded his affidavit:
As at the date of this affidavit, Mr Healy has not returned my deposit.
24 All this evidence is very clear. So, I find, beyond all doubt, that there was a failure by Mr Healy to order the parts necessary for the McCarthys' air-conditioning system - contrary to undertaking (1.2).
25 Furthermore, I find it also established that the McCarthys' nominated air-conditioning system installation date, was 16 December 2009. Undertaking (1.4) is to the effect that within 24 hours of Mr Healy becoming aware of any circumstance that prevented him from being able to supply a system on a date specified; (here, for the McCarthys, by 16 December 2009), Mr Healy would inform (the McCarthys) of the reason(s) why there would be a non-supply and, furthermore, nominate a fresh a date when the system would be installed.
26 I find it established beyond any doubt that there was no communication made by Mr Healy with the McCarthys after 16 December 2009 - the latest time at which Mr Healy would have become aware of any circumstances preventing him from being able to supply the air-conditioning system to the McCarthys as nominated, on 16 December 2009.
27 This second alleged act of contempt is also established beyond all doubt.
28 The third alleged contempt raised in respect of Mr Healy's contractual relationship with the McCarthys arises out of undertaking (1.5), namely, that if supply and installation of a system sold to a customer, could not be completed within 14 days of the date specified in the contract of the supply of the system, that Mr Healy would refund in full all monies received from the customer, with such refund to be made within 48 hours of that 14 day time limit. I find it established here, beyond any doubt, that the air-conditioning system installation date for the McCarthys was 16 December 2009. The system was not installed on that nominated date. Fourteen days after that date, was 30 December 2009. After 14 days expired, by undertaking (1.5), Mr Healy should have refunded in full, all monies received within a further 48 hour period. Mr McCarthy had paid $3,300, as a deposit, on 27 November 2009. These deposit monies should have been refunded within 48 hours of 30 December 2009, say by 2 January 2010. The evidence is overwhelming that those monies were not refunded within that 48 hour
(Page 8)
- period. Indeed, they have not been refunded, even as of today (6 October 2010).
29 I find, therefore, that the three contempts as alleged by the Commissioner, in respect of the McCarthys' (oral) contract with Mr Healy, have been established beyond any doubt.
30 The next relevant consumer contract is that entered with a Mr van der Westhuizen, whose affidavit was received, and stands uncontradicted (exhibit 2). The only argument put to me by Mr Healy, against what otherwise appears to be a clear transgression, as regards Mr van der Westhuizen's deposit not being returned 14 days after a nominated installation date was not met, (ie the refund to be 48 hours thereafter), is by reference to attachment DW2, in exhibit 2. There, under purchase contract 3679, is found a reference to the two components of an air-conditioning system ordered by Mr van der Westhuizen, for his total 'investment' of $5,580. A notation next to the component for cooling (ie component 2) refers to a 'fully ducted evaporative cooling DC270 220'. There is also seen a longhand notation 'November'. Underneath the 'total investment' notation, (at items 1 and 2), is seen the reference to 'approximate install date - heating four weeks and cooling November'.
31 The term 'heating' is a reference back to item 1 of the components of the 'investment' - being a reference to a fully-ducted solar heating for 11 outlets, for which a deposit of $1,790 was to be paid, with the other 50% of the balance on certificates.
32 It is clear, as a matter of the plain interpretation of the words of this purchase contract of 28 April 2010, that the supply promise in respect of a fully ducted solar heating system was to install it no later than four weeks after 28 April 2010. So there arose the obligation to install that heating component of the system by no later than 28 May 2010. On the uncontradicted affidavit evidence of Mr van der Westhuizen, no installation occurred as promised, or at all.
33 Mr van der Westhuizen relates by his affidavit that he paid a deposit to Mr Healy of $1,790, by BankWest cheque on 28 April 2010. He then says, at par 15, 'by about early June 2010', he had not heard from Mr Healy. A solar heating system had not been installed. At par 16 he mentions the many unanswered messages he left on Mr Healy's mobile phone and on a business telephone number for Aircon Factory Direct. He sent text messages to Mr Healy's mobile phone, as well as an email,
(Page 9)
- advising Mr Healy that if he did not get a response he would report the matter.
34 Mr van der Westhuizen then says at par 17:
On 8 June 2010 Mr Healy telephoned me on my mobile phone and said words to the effect 'I'm responding to the messages you have left for me.'
35 In par 18:
Mr Healy also said words to the effect, 'your file has mistakenly been placed with the file for airconditioning installations which will occur later in the year and this is the reason why there has been a delay.'
36 And:
'I will get back to you with an installation date for the solar heating system.'
37 At par 19:
On 15 June I sent a text message to Mr Healy's mobile phone number which said, 'Hi Alwyn, I need to get some kind of progress. If you cannot supply please just refund my deposit. Regards, Deon.'
38 On 24 June 2010, Mr van der Westhuizen received a text message from Mr Healy on his mobile telephone:
Hi Deon missing heater parts in hand. Installing south Thursday to Friday, north Monday to Wednesday. Your installation Wednesday the latest. Will confirm Monday morning. Alwyn.
39 At par 21 Mr van der Westhuizen relates:
Since 24 June 2010 I have not heard anything further from Mr Healy. I have tried to contact him on numerous occasions but he has not returned any of my messages.
On 29 November I sent him a text message to his mobile telephone number which said:
Hi, still heard nothing?? Deon.
Alwyn, this is taking way too long. I want to cancel. Need my deposit back or will go to the police, DOCEP. Deon.
(Page 10)
41 At par 23 Mr van der Westhuizen states:
I have not received any response to this message.
42 Mr van der Westhuizen concluded, saying that a solar heating system had not been installed and that Mr Healy had not refunded his deposit.
43 I find those uncontradicted facts to be conclusively established beyond any doubt. They establish quite demonstrably, on my assessment, a breach of Mr Healy's undertaking to refund deposit funds within 48 hours after a 14 day period had elapsed in respect of any (unmet) promised installation - relevantly here, as regards the heating component of an air-conditioning system for Mr van der Westhuizen.
44 It is manifest from the terms of this purchase contract with Mr Van der Westhuizen that there was to be a fully ducted solar heating system installed within four weeks of 28 April 2010. By the end of May 2010 that had not happened. A diverse number of explanations or excuses were offered at the time by Mr Healy. But none of them was to the effect that the obligation to install only fell due as at November 2010, as regards the nominated date for installation of the cooling air-conditioning component in that transaction - which I find to be a distinct installation component of the arrangements. That late excuse emerged only recently from Mr Healy. In my view, it is wholly untenable.
45 On the face of it, Mr van der Westhuizen was within his rights to regard what had occurred as a serious non-performance and breach of contractual obligations by Mr Healy, thereby, allowing Mr van der Westhuizen to terminate his purchase contract and entitling him to a refund of his deposit.
46 I find, therefore, that a further contempt is established by the established breach of Mr Healy's undertaking (1.5) in his failing to refund Mr van der Westhuizen's deposit within 48 hours following a 14 day period of non-installation of an air-conditioning system. This contempt has been conclusively established, as regards the consumer contract with Mr van der Westhuizen.
47 The remaining two breaches of undertakings alleged against Mr Healy, are in respect of consumers Merilyn Lee Penn and Sumah Shepherd respectively. They were also the subject of uncontradicted evidence to be found in exhibits 3 and 4, their affidavits.
(Page 11)
48 Again, these contempt transgressions as alleged, relate to unmet promises by Mr Healy to install air-conditioning systems at the nominated installation date - there being no subsequent refund of deposit monies to these consumers, 48 hours following a 14-day period in each case, thereby contravening Mr Healy's undertaking (1.5). No evidence was led by challenge to these consumers' affidavits. Again the evidence conclusively proves beyond any doubt two breaches of undertaking (1.5), as regards these two consumers.
49 There was a (faint) attempt at an explanation from Mr Healy during his submissions, suggesting that there had been some difficulties for him in carrying out these works - which has ultimately led to him ceasing in business and now, only acting as a commission agent. However, the evidence from each consumer stands uncontradicted. They were clearly promised an air-conditioning system product at a fixed time. The supply promises were dishonoured. Worse, there was no explanation from Mr Healy to those consumers as to the reason(s) for failure to supply what had been promised and had been paid for (in part). Essentially these consumers found themselves out of pocket in respect of their deposits - with nothing to show for it and facing only a deafening silence from Mr Healy.
50 It emerged only very late, during closing submissions to me by Mr Healy in person, (who chose not to give evidence and so, to enter the witness box to be cross-examined, as was his right) that he had procured three bank cheques to effect the refund of the deposits in respect of the funds earlier received from Mr van der Westhuizen, Mrs Penn and Mr Shepherd.
51 A tendered bank cheque in respect of Mr Shepherd was accepted by the Commissioner on behalf of Mr Shepherd as it was tendered by Mr Healy; that is, at 3.42 pm on 6 October 2010. However, the Commissioner, through counsel, at that time, due to this very late development, had no instructions to accept the tendered cheques in respect of Mrs Penn and Mr van der Westhuizen. However, that situation altered. Eventually, after 4 o'clock, the Commissioner did receive instructions to accept the bank cheques as tendered by Mr Healy for all three consumers.
52 The position therefore, is that each alleged contempt (there being six in all, three in respect of the McCarthy contract, and a further three in respect of distinct further consumer contracts, by reference to the failure to refund deposit monies) is established against Mr Healy, beyond reasonable doubt.
(Page 12)
53 Were it not for the three bank cheques being produced late by Mr Healy, I would have been left with little alternative other than to impose an immediate sentence of custodial imprisonment - given what I assess to be the overall seriousness of these now proven breaches of Mr Healy's undertakings.
54 Each act of contempt, as alleged, has now been conclusively proven. There was, in each case, a failure to perform by Mr Healy in terms of a non-delivery of the product promised to these consumers. There is also a manifest failure to inform or explain to each consumer what was happening - following the failure to meet the nomination installation date - essentially by Mr Healy not communicating at all - thereby leaving each consumer from then, to worry over whether or not they had been completely misled and about losing their deposit monies. These are extremely serious breaches of undertakings, not to mention the consumer protection laws of Western Australia, see s 10 of the Fair Trading Act 1987 (WA). In all the circumstances, a strong sanction indicating the court's complete disdain for shoddy conduct by contumelious breaches of undertakings is required.
55 However, Mr Healy has now tendered, albeit very late, the three bank cheques in respect of three of the four consumer contracts, the subject of the proven contempt charges. I have also found that I reject Mr Healy's technical arguments in respect of the date of the contract with the McCarthys. I have found that the McCarthy contract was the subject of his undertakings, and which have been breached in that transaction as well (threefold transgressions as proved).
56 In terms then of the appropriate sanction to be imposed, I stand heavily influenced by whether or not Mr Healy makes good upon a late promise made today, to refund $3,300 to the McCarthys by the end of Friday next week; that is, for avoidance of any doubt, by Friday, 15 October 2010.
57 My imposition of an appropriate penalty which, on the face of it, as of now, seems to prima facie dictate a penalty by way of custodial imprisonment, will be heavily coloured by whether all consumers have restitution made to them, or not. In respect of the McCarthys, Mr Healy has indicated that he is not today in a position financially to do that, however, he believes he will, by Friday of next week, based upon his projected receipt of commissions he says are due to him, in that period.
(Page 13)
58 That being the case, I will therefore reserve my penalty decision until Monday, 1 November 2010 at 9.30 am.
59 I would expect, in any event, that there will be an affidavit filed after 15 October 2010, indicating the end position in terms of the McCarthys receiving back their deposit, or not.
60 With the benefit of that information, I will then decide the appropriate penalty. I should not be regarded as ruling anything in or out. I will observe at this point that there seems to be a significant and serious breach of undertakings - with adverse financial consequences for innocent consumers. There are also sentencing considerations concerning both general and personal deterrence involved that must all be weighed.
61 I do note that in a recent decision Chief Executive Officer of the Department of the Environment and Conservation v Szulc [2010] WASC 195, the Chief Justice imposed a period of imprisonment of 3 months, in respect of a transgression assessed by him to be a serious contempt of court. That will be one case relevant in my deliberations as to penalty and also, as I have indicated, the issue of restitution to the McCarthys.
62 I therefore adjourn the question of penalty until 9.30 am on Monday, 1 November 2010.
Penalty decision (delivered 1 November 2010)
(This judgment was delivered extemporaneously on 1 November 2010 and has been edited from the transcript.)
63 It is important to observe that contempt aspects of a civil matter are unique in the sense that transgression is assessed at the level of the criminal standard of proof; that is, upon proof beyond reasonable doubt.
64 I was satisfied on the basis of the evidence received at the last hearing that six contempts have all been established against Mr Healy - to that very high standard.
65 It is now important to view this contempt proceeding in the overall context of this litigation. Civil proceedings were commenced against Mr Healy on 18 August 2009, by the Commissioner for Consumer Protection. They were commenced in conjunction with an application by the Commissioner for an interlocutory injunction, to restrain Mr Healy in respect of conduct by reference to an alleged deficient supply of
(Page 14)
- installation systems or components of such systems to many consumers in Western Australia.
66 An amended statement of claim filed in the civil proceedings by the Commissioner on 20 October 2009, identified a series of 17 alleged infringements in respect of 17 different consumers, as regards the non-supply of airconditioning systems, the subject of consumer contracts, over the period between April 2008 and July 2009.
67 The statement of claim also raises grievances against Mr Healy, as regards seven further alleged infringements, in respect of the non-supply of heating components of installation systems between 9 November 2007 and mid-October 2008.
68 It is important to observe that all matters remain the subject of the civil proceedings which are now defended by Mr Healy, now representing himself in person. He has filed a defence pleading disputing the allegations by the Commissioner of infringement against the West Australian consumer laws over what are, in aggregate, some 24 infringements.
69 However, these are not the matters I am dealing with today. Those 24 allegations remain unresolved as the subject of defended proceedings. They are the subject of orders, made by me last Thursday, to the effect that they be attempted to be resolved through the mediation processes offered within this court.
70 The matter I am now dealing with relates to the six (now) proven breaches of undertakings given to the court by Mr Healy as regards four other consumers. Those undertakings were given by Mr Healy whilst legally represented in the context of the Commissioner's then pending application against Mr Healy seeking interlocutory injunctive orders to restrain him from any further dealings with consumers. Those interlocutory injunction proceedings were, in the end, resolved - on the basis of the undertakings given to and accepted by the court from Mr Healy, on 18 November 2009.
71 It is important to appreciate that undertakings received by a court have the status and enforceability of injunctive orders of the court: see Thomson Australian Holdings Pty Ltd v Trade Practices Commission (1981) 148 CLR 150 per Gibbs CJ, Stephen, Mason and Wilson JJ (164 - 165). They are akin to formal court orders by which a person is bound by compulsive order of the court. An undertaking, received in lieu
(Page 15)
- of an injunction is a voluntary commitment by a person, in effect, subjecting themselves to designated obligations.
72 So what the Commissioner contends for and has now proven is that the series of undertakings as were provided by Mr Healy to the court on 18 November 2009, have been broken by him thereafter, in the six respects I have assessed previously.
73 Underlying each consumer transaction is a common deposit transgression. In each of the four transactions, a deposit or part-instalment of funds was paid over to Mr Healy on the basis that an installation would follow of an air-conditioning system or a component thereof. When that did not occur, expressly contrary to Mr Healy's undertaking (1.5), there was a failure by him to refund the deposits 14 days after the required time for installation (then a further 48 hour period). That was simply not done.
74 At the eleventh hour on 6 October 2010, three deposit amounts were tendered by way of bank cheque by Mr Healy. Then, in respect of the transaction regarding the McCarthys, Mr Healy indicated it was his intent, as soon as he could obtain funds, to refund that deposit.
75 In fact, it took until Saturday, 30 October 2010 for that to occur finally for the McCarthys' benefit. The fact that all four consumers in question have now had their funds returned, albeit belatedly, and albeit on the basis of these proceedings being run and then unsuccessfully defended by Mr Healy, are relevant matters that bear upon me in terms of today's sentencing disposition in regard to the contempts.
76 In terms of the imposition of a penalty, it is important that I mention first, some principles applicable. The observations of Martin CJ in Chief Executive Officer of the Department of the Environment and Conservation v Szulc [2010] WASC 195 delivered 26 July 2010, provide me with considerable assistance. What his Honour said between [35] to [37] bears repetition. He said [35]:
The powers of the court to punish for contempt are unlimited. There is no maximum penalty applicable and the Court can either impose a sentence of imprisonment or a fine under the Rules of Court. If a sentence of imprisonment is imposed then the provisions of the Sentencing Act 1995 (WA) and the Sentence Administration Act 2003 (WA) including those provisions relating to parole are excluded from application as a consequence of s 3 of the Sentencing Act and s 3 of the Sentence Administration Act.
(Page 16)
- This means that a person sentenced to imprisonment for contempt will serve the term imposed by the Court without prospect of early release on parole. In the case of terms of imprisonment of less than 12 months, most prisoners must be released on parole after service of half the term pursuant to section 23 of the Sentence Administration Act, but as I have mentioned, that provision does not apply to persons imprisoned for contempt.
The result is that persons imprisoned for less than 12 months for contempt will generally serve double the period in custody which would be served by a prisoner sentenced to the same term and who is subject to the Sentencing Act and the Sentence Administration Act.
77 Although the Sentencing Act is not applicable in respect of a contempt, as the Chief Justice has observed in Szulc, the factors identified at s 6 of the Sentencing Act provide a guide to circumstances which should be taken into account for the purposes of passing sentence.
78 The Chief Justice went on to observe in Szulc that case authority, see Wood v Staunton (1996) 86 A Crim R 183, suggests that matters properly to be taken into account included; the seriousness of the contempt proved, the reason for the contempt, whether there has been an apology or public expression of contrition, the character and antecedents of the contemnor and the general and personal deterrence in denunciation of the contempt, as I do.
79 In the present case, the undertakings were given at a time when Mr Healy was legally represented. They have clearly been transgressed. It may be that a poor financial performance by Mr Healy's business contributed to its illiquidity, in terms of it not being in a position to give refunds. The circumstances surrounding each contempt are undoubtedly serious, also bearing in mind the unresolved state of the overall action that remains pending against him, with 24 other consumer allegations not yet resolved.
80 The acquisition of an air-conditioning system for a house is a very significant financial outlay for the average consumer. It must no doubt be extremely distressing for a consumer to sign up in good faith to a contract thinking they will be delivered the positive benefits of an air-conditioning system (for a considerable outlay of money), only to receive nothing, then, even worse, to be told nothing as to why, by the supplier and so, to be left to worry that their money has been lost.
81 That is simply intolerable business conduct. The consumers of Western Australia deserve better. It is unacceptable that they be subjected to conduct of this kind. The contempts with which I now deal, must be
(Page 17)
- assessed as most serious as regards their adverse implications against West Australian consumers.
82 The Chief Justice in Szulc referred to factors identified in the Sentencing Act. It is necessary to elaborate upon three particular sections in that Act which, although not strictly applicable, as the Chief Justice said, do provide some assistance, in terms of how a court may proceed as regards penalty.
83 Section 6(4) of the Sentencing Act provides:
A court must not impose a sentence of imprisonment on an offender unless it decides that (a) the seriousness of the offence is such that only imprisonment can be justified, or (b) the protection of the community requires it.
84 A further provision of the Sentencing Act, s 39, lays down nine distinct sentencing options under s 39(2) which range from a spent conviction order through to a custodial term under Part 13 of the Act.
85 Subsection 39(3) says:
A court must not use a sentencing option in subsection (2) unless it is satisfied, having regard to division 1 of Part 2, that it is not appropriate to use any of the options listed before that option.
86 The sentencing options available range from a spent conviction order, to a fine, through to suspended imprisonment, up to a custodial term of imprisonment.
87 Lastly, I mention s 76 of the Sentencing Act - in regard to suspended imprisonment. Section 76(2) says:
Suspended imprisonment is not to be imposed unless imprisonment for a term or terms equal to that suspended would, if it were not possible to suspend imprisonment, be appropriate in all the circumstances.
88 In present circumstances, the three contempts regarding the McCarthys I will view essentially as one course of adverse conduct across one consumer transaction. Therefore, viewing the overall position as a matter of four distinct consumer transactions and four distinct transgressions, a prima facie imposition of 10 days imprisonment for each transaction contempt - for four distinct consumer conduct transgressions - would result in a prima facie period of imprisonment of 40 days.
(Page 18)
89 I must take account of the fact that, albeit belatedly, Mr Healy has now refunded the part-instalment payments or deposits paid in respect of the four consumer transactions the subject of the contempts. I take that restitution into account by reducing by 50% the prima facie period of 40 days imprisonment that otherwise would seem to be appropriate, had the refunds not been made.
90 In all the circumstances then, Mr Healy is facing a term of 20 days imprisonment, without parole.
91 But, the Sentencing Act reminds me, as I would in any event, to re-consider the appropriateness of all available sentencing options, including the option of suspended imprisonment, before finally imposing a term of custodial imprisonment - the outcome I would otherwise assess, as being appropriate. I will then take one last look at the implications of a custodial sentence for Mr Healy.
92 I take cognisance of the unresolved pending action which has now been referred to a mediation on the basis that the parties, after considerable time, presently both seem to think that through mediation there may (hopefully) be a positive resolution to those unresolved proceedings.
93 I also take into account (with the belated refund of the four deposits) that Mr Healy is no longer operating as a sole trader, in business. He is, he says, working as a commission agent selling air-conditioning systems for a principal.
94 I also take account of the fact that the undertakings given to the court by Mr Healy on 19 November 2009 have not been withdrawn. They remain in place unaffected and so, continue to apply.
95 The court has power not only under the Sentencing Act, but also by the Rules of Court (see O 55 r 8), to suspend execution of a committal order. Order 55 r 8 provides:
The court making an order of committal may by order direct that the execution of the order of committal shall be suspended for such period or on such terms or conditions as the court thinks fit.
96 In all the circumstances then, it seems, as of now, to be appropriate that I suspend the 20 day term of imprisonment for a period of 12 months. However, let me be absolutely clear. If the undertakings given by Mr Healy - which remain in place - are proven to be infringed again, over the next 12 months, the matter is likely to return to me. If it does, the
(Page 19)
- suspension which I have imposed, will likely be lifted. If that happens the suspended 20 days custodial period of imprisonment will likely be served by Mr Healy in such circumstances. So the penalty is real and remains over Mr Healy.
97 On the other hand, if in the next 12 months there are no further infringements of the undertakings, then on 1 November 2011 the slate will, in effect, be wiped clean for Mr Healy as to these six, now proven, contempts.
98 So my final disposition is a period of 20 days imprisonment, but suspended for a period of 12 months, on the basis that there must be no further transgressions against his undertakings of 12 November 2009 by Mr Healy in that 12 month period.
2
2
1