Eva, Geoffrey John v Mazda Motors (Sales) Pty Ltd

IN THE FEDERAL CGURT

Nos. VG 1 - 7 of 1977

BF AUSTWIA	\
GENERAL DIVISION

In the matter of

THE TRADE PRACTICES ACT

1974

Between. -

GEOFFREY JOHN EVA

Informant

And -

MAZDA MOTORS (SALES) PT".

LI?!ITZ

Defendent

SMITHERS, 2 .

This Court doth Order

in proceedings VG 1 of 1977 (B No.

377

of 1975) thet the defendant is ccnvicterl

of committing a contraventlon cf S. 53

197/+

in that

in trade or commerce in

connection with the promotior,

advertising of the supply of gooas tc wit Mazda cars it did represent that some of such goods had accessories They

did not have, the representation being

made in an advertisement published

iii

"The Age1' newspaper dated 15th February

1975, and the defendant

is ordered to

pay the sum of $2,500 as the Pme

which is hereby imposed in respEct of

such contravention and to pay The

informant's costs of these proceedings

as taxed by the Registrar;

in proceedings VG

2 of 1977 (B No. 578

of 1975) that the defendant is ccnvicted

of c0mmittir.g a contraventlon

of S. 53

197k in

that in trade or comnerce in conncctiac

with the pronotion by advcrtlslnZ .-,f

the supply of goods to wit Mazda czrs

it did represent that some

of PUC;~

goods had accessories they did

noT k v e .

the representation being made

in an

advertisement published in

"The

Age"

newspaper dated 21st February 1975,

and the

defendant

i s ordered

pay

the sum of $1,500 a s

t h e

f i n e

whlch

is hereby

imposed

i n r e s p e c t

of such

contravention

and

t o pay the informant 's

cos t s

of these proceedings as taxed

by	the Reg i s t r a r ;

( i i i )

i n

proceedings VG 3 of

1977

( B No.

379

of 1975) that

the defendant

is convicted

of committing a contravention of S. 53

Act

1974

i n t h a t i n t r a d e

o r comnerce

i n

connection w i t h the promotion by

advertising of the supply of

goods

t o

w i t Mazda

ca r s

d id r ep resen t t ha t

some

such goods had accessories they

did	not have, the representat ion belng

made

i n an

advertisement published ln

"The

Age"

newspaper

dated

5th

March

1975, and

the defendant

i s

ordered to

pay

the

sum

of $2,000 as t h e f i n e

which i s hereby imposed i n respect of

such contravention

and t o pay the

informant's

costs

these

proceedings

taxed by

the Regis t ra r ;

( i v )

i n

p roceed ings

VG 4 of 1977 (B No.

380

of 1975)

t ha t the defendant

i s convicted

of committing

a contraventlon of S. 53

Act

1974

I n

that

i n t r a d e o r

commerce

in connect ion

with the promotion

by aaver t i s lng of

the supply of goods

t o w i t Mazda

ca r s

it did r ep resen t t ha t

some

such

goods had

accessor ies they

did not have,

the representat ion being

made i n m

advertisement published In

"The

Age"

newspaper dated

15th March 1975,

and

the defendant

i s ordered t o pay the sum

$4,000

a s t h e

f i n e

which i s

hereby imposed

i n respec t of

such

contravention an(- to pay the informant's

cos t s

of these prJceedings as taxed

the Reg i s t r a r ;

in proceedings VG 5 of 1977

( B No.

331

of 1975)

that

the defendant

is convicted

of comrnittlng a contravention of S. 53

( c ) of the Trade

Prac t lces Act

1974 I n

that

i n t r a d e o r

commerce

I n connection

with the promotion

by adver t i s ing of

<?e

supply

goods

t o w i t Mazda

cars

d id

represent that some of such goods had

accessorfes they

d id not have, the

representat ion being

made i n an

advertisement published in

"The

Age"

newspaper dated 20th

March

1975,

ana

the

defendant

1 s ordered to pay +he

sum of $4,000 a s

t he

f i ne

whxh

Lsreby lmposed

i n r e s p e c t

such

contravention

and

t o pay the informant 's

cos t s

of these proceedings as taxed

the Reg i s t r a r ;

( v i 1

i n proceedings VG 6 of l977 ( B No.

382

of 1975) that the defendant

is convicted

of committing a contraventlon 3f S. 53

( c ) of t h e Trade Practices

Act

197& i n

that

i n t r a d e

o r commerce

In connection

with the promotion

advert is ing of the

supply of goods

t o w i t Mazda

car's

d id represent tha t

some

such goods

had accessories they did not hal,/e, the

representat lon bemg

made i n an

advertisement published in

"The

Age"

newspaper dated

1 s t Apri l 1975,

and The

defendant i s ordered

pay

sum of

$4,000

a s

t h e

f i n e

which

is hereby

imposed

i n r e s p e c t

such contraventlon

and

t o pay the mforrnant 's costs

o f

these

proceedings as taxed	by	the Reg i s t r a r ;
and

( v i i )

i n

p r o c e e d i n g s

7 o f 1977

(B No.

383

of 1975) that

the defendant

is convic<ed.

of committing

a contravention of S. 53

( c )

of the Trade Practices

Act

1974

i n

t h a t i n t r a d e

o r commerce

in connect ion

with the promotion

adver t i s ing of

the

supply of goods

t o w i t Mazda

cars It

d ld

r ep resen t t ha t

some

such

goods

had

accessor ies they

d ld

not have, the

representat ion being

made i n an

advertisement published in

"The Age"

newspaper dated

2nd Apr i l 1975, and the

defendant

i s ordered to pay the

SUT

$2,000 a s

t h e

f i n e

which

i s hereby

imposed

i n r e s p e c t

such contravention

and

t o

pay the informant 's costs of

these proceedings as taxed	by	the
Regis t ra r .

Date :

22nd Apri l 1977.

DATE :

Mazda Motors

(Sa1es)Pty.

Limited

i s

cmvic ted

seven charges brought

upon

mformat lons in rcsgcc t

o r

seven contraventions

of the provj s ions

o f S . 53 ( c ) of tile

Tradc Practlces Act

1974.

The

maximum

penal ty 111 respec t of

each charge

1:;

$50,000.

L .

The

r e l e v a n t o f f l c c s ,

- lot being equ~pp+d

vlti:

adequate

kcowledp

t h e l r

@.m, we?'t> s?.t lsfiec! In

the

rd.1,:;t

p l ace to au tho r i se pub l i ca t lon

t he r e l evan t

series

advertisemenzs without verlflcation

t ? e stai-nrncnts

t iLkre ln

as put before

them

t h e l r a d v e r t i s l n g

agenc-{,

w r e l y

t h e

assumption t h a t such stateam-1 ts were

t r u e ,

and t k n , vhen

t h e r e a f t e r It was revealed that

t h i s an;lmptlol?

wrnn;;

they

fa i led to take adequate remedial actLon.

Mazda

Motors

(Sales) Pty. Lirnlted

(hcreinafte,.

c;.lled

Mazda)

i s a

company which

was

r e g i s t e r e d i n

t h e S t a t e oi'

Vlctor1.i

i n 1967.

It has car r ied

on business from t h a t t x n e as a vendor OF

Mmda motor vehicles.

It i s a successfu l con;p,c L i t o r and t r a d c r .

The

range of vehicles re levmt

t o

the present

proceedlxs are seven sedans

knom

res?ec t lvr ly

thi

Fhzd3

RX-4, Mazd3 W;-3, "Izda M-2, Mazda 929, Mazdz 1600, Ilazda l300 and Mazda 808.

Such a device reduccs

t ' . ~

io rce requll'cr! t? be

appl ied by

ca r d r lve r t o ach ieve

pdr t i cu la r

rc.zulT

h e

operat ion of the f o o t brake.	It cont r lbu tes to	: z d c t y xi
reduces d r inng f a t lgue .

a p p e a r s t h a t a l l t h e

Mazds

models other.

that?

PIazda

l300 and h z d a EO3 a r e f i t Led with

t h l s dsv~ce.

L: .

i s said with respect

t o

t h e

ad-rer t isemmts

of 21st February

and 20th March -that read Cnirly

they should

be understood

as saying no more w i t h respect to servo-asslsted

brakes

than

tha t

the

1600 model

i s ecluipprd

therewith.

I a n

unable

t o accep t

t h i s .

op:r.lcn

I t 1:; c l e a r

t h z t

t h e

, reader

i s belng informed that whatclrcr

Fazcia

sedan c-r he

may have i n mind it i s equipped with	A	servo-assls ted disc
brakes.

It may be seen therefore ,

That thz sdvertls-ments

15th February and 15th

March

t c l l t h e

re?.der

t ha t t he

80s

model i s equipped wlth cervo-assis

ted breke:;,

t h a t t;le

advertisements of 5th

March

and

2nd

A p r i l t e l l t h e

1-et:dcr tht

the 1300 model

i s s o equipped,

that

the advert lsmentc

21st

February, 20th

March

and

1st A p r i l t e l l t h e r e a d e r t h a t

all

Mazda models a r e s o equipped.

Thus each sdvert lscnent

con tamed a represt-ntatlon I.’?at

goods t o 1300 model o r both had

which It r e fe r r ed , namely the 809 model

c r

t h e

an accessqry which they dld

not

have.

The

representa t ion was

nade

i n trade and connerce

cmmectlon

with

the promotion

nelvspaper

advzr t i s ing of

the

s q q d y of

Mazda

cars .

7 .

prosecution

i n r e l a t i o n t o a

contravenLlon of

S .

( c )

It i s a dr;fence i f the defer ldant cs t ibl lshes

(a )

tha t

the

cont raver l t ion

r?spec t

{chich

the proceeding

WIZ

i n s t l t d t e d was

due

t o a

mistake,

to re l lance

~r!I"orrllation

s7lpplied

another person, to

t h c z c t 3r

dc?.mlt

another p"rson,

t o an accldent

o r to some o t k r

cause

beyond

h l s c o n t r o l ;

end

t h a t he t o o k reesonable pi-:cautlolls

dnd

exerclsed due d l l lgencs to

avoid

thc

contl-a\,ntion.

behalf of

the defendant

It is e a i a t h a t

L:.)

C:qr

as there was any contravention it wac due t o a mls tnke,

t h a t it was

due

t o re l iance upon mformation suFplied

another person,

namely Gen-ral Advertising or

Its servants ,

and t h a t It was

due t o t h ? clct

01- deIaul t o f

a n o t h e r 115r.3011,

namely

the adver t i s ing

company

o r i t s servants .

And

It i s s a i d thzt the defendant

too'<

rcasodlble

precaut ions and exerclsed due d l l i p n c e t o avold the

contravention.

8 .

It was necessary to fonnula te

Itphllosophytt o r thcrno f o r the

campelgn.

The phlllosophy

adoptpd

?nL~-~l

;e:i the port-ayal 01

ali Mazda

sedans as vehicles

hav71ng m comnlon as s tandard

equipment

mmy

s p e c l f l e d a t t r d c t l v e

f c p t m e s .

It appears

that

the conlpny dld not

s111>21y

Mr.

Wllllams

l i s t of

such f e a t u r e s b u t l e f t

it t o h l s agency

to iden t i fy su l t ab le €ea tu res f ro r !

b r o c h r - c s

concemmg tllc

var ious

models

which

had

been

supplied.

t o

h is

agency

previously as the var ious mode1.s had c m ~

on tl7.e

m x k c t .

In the case

Model

R08

t h a t x c u r r e d a b o u t

1971 and

Model 1300 about 1970.

It i s c l e a r t h a t

Mr.

Wllllalns r-p.l.ded

It :IS

p a r t

o f

t l l2

duty o f

h i s agcncy

to put befare =he

c1iei-i';

for . iis

approval

acivertlse!xeat

contxrllnG

tr-ut-11.

He ~:,lci

t i ~ ? .

i n t h e k i n d

o f

re la t ionship

betweer. h?nl:;?i

and thc :mr-qy:,.erir

of Mazda he tended

t o become involved W I

t l !

the

con:]~zn.y >c

t ha t he

knew

the i r co rpora t e

aims and cc;lld

?,n

:;cmmt?

and

ef lect lve

Job.

But

d l d not re&;?-?

t h e :.xL?racl;

the advertisements

as t o t a l l y h x f u n c t l o n as

" o b i r ~ ! ~ I ) ~

t h a t were

t o t z l l y t h e f u n c t i o n

the

agcncy

I:CJU?.~ LO t

supply

proofb'l.

He cas asked -

ttWIlerever t he genes i s l i cz ,

t h e f a c t

rr-malns

tha;;

you

t o o k

these

advcrtlsements

r ;he i r i i ca l l ayout

folm

hacl:

t o Dlazda Motors and to ld then +ha t t hey

wore the oil~cli'tlsiI~!l-JIL~

i n f u r t h e r a n c e	of	the	campaign	a	d	dskc-d f o r t h e l r q?p'r.ovnl?
--- Yes.

You

then rFce ivcd tha t approval eqress ly

f r o n

I I Z Z C ~ L ~.:!J~ox

(Sales) Pty. Ltd.?

--- Yes.

And

you would not have pursued,

as p a r t of yodr funct ionme

the ac tua l pub1icat;on

of those advcr h semcnt 7 M?. thou;

tll~r:

express approval

of Mazds MGtor::

(Ss l e s ) Pty. L t d . to

cio ss''

---	Cer ta in ly no t . I t

you think you recelve a proof?" fra:llr.ly answerrd "To L1iLC.k

it	f o r cor rec tness" .

Mr. Chapmm was

a busy m a n .

He ha? l i t t l e

memory o f the checking

o f r a y proof:.

m ( ? 1s vague a s t o

Mazda's procedure

in r e l a t l o n t o the checklrig

oi Frsors .

Mr.

Smlth concedes

t h a t he saw the pvqsfs , but

It i s 3 P o l r

inference from h l s evldencn t h a t he did r o t chcck t h m €01.

accuracy

j n

r e l a t lon

t o

t h e technical

d e t a i l s .

d l d I:;?.

know

a t t h a t t m e ,

and r e lxhe r d id

TL-. Cilapscn,

~11cLhr1-

t l . ?

808 and 1300 did

o r d id n o t have servo-hssu ted brakes.

I t

But i n approving

the a6vertiscmenTs

i1l.s-y werc

au thor ia ing publ lca t ion :.udcI y

and

prmlr l rn t ly

O T I ' ~

period

of months,

statemcnts i n po=. i t ive fop- , tc a

~ d l i l t u d e

po ten t la l cus toners

tha t

i lode ls

X 3 2nd

1 j G O w,71-5.

ec;u~~.yed

with

servo-assisted

brakes.

It 1s c l c a r

t h a t

a p ~ - ~ ~

i;om

considerat lons al l is lng

out of

the T r a d u Pmctlcc:;

Ac-t,

ordinary prudence required that every ztaten:cnt

aLoct

t l ~ o

a l leged

common fea tu res o f all th?

Ihzda nodcls should ;,c

ca re fu l ly ve r i f l ed .

duty to be accura te , there

:-L;

le:):

I-,

e sk1ar;d

rczpcm? 15j 1:t-y

on t h e p a r t

o f

t h e ageccy

aid the co:i .c~ly on

the mztter

o f

zccuracy.

The subnission o f rough co?y and

proofc

was a

procedurc designed

t o enahle the

comperly t o p ~ z y

ii;s p & r t

i n

t h i s

s h a r e d

r e s p o n s i b i l i t y .

B u t

i s rr,y

vlew

tli&,t ]lot

only was

the respons ib l l i ty shared

h u t

khat

com;kLrly hcre

the u l t ima te r a spocs lb l l l t y . The s1:tements t o be w d e t o the public. wcre t o k c mede as staternenis of t h com!ml?j:, not of the acency, end the pEblic was t o be r.sked t? accept kern as t rue s ta tements f o r whlcL the co~~q?-ny took xspwsl121 l.~?y.

I do not regard it BS reasonable o r d i l l g e n t for the cony,3-~-~y

t o have assuncd without

any

t e s t

o r v e r l f i c a t l o n

thtit

thc

copy produced by the age'1-y v m ~

corrcc t .

16.

The	defendant 1s therefore convic-~ed I n respc-Lt

o f	each infornat lon.

'I 7'

may

be corrmitted

i s such t h a t p e n a l t l c s

which

rxy be

oppres s ive in r e l a t lon to

some defmPsnts would he seen

tc be

t r i v i a l

i n

r e l a t i o n

t o o t h e r s .

The

penal ty

m y palrtLcul5r

case

must be

s u f f l c l e n t

t o re I lec t thc Erz-J i ty

01 %he

offence,

and

t o ref lect Par l iament

'F,

un:qunvocal

Incr .nt lc?r l

tha t

i t s w i l l i s to be

obcyed.

The

gravdn'en

o f

the defendar l t ' s fau l t

i i l t h l s

cczc'

i s

that through nef;ligence

w d pre-occup?tion with otber

mat terr

2nd

en tkus l?sn for

I t s product.

It cxerc.1 sed nc

scru t iny o f tine

accuracy of

the s ta t t .mmrs

l t autfiorlsed rgr

publ ica t ion to the public and thereby fal led

rkspond t o -tile

dut,g,resting upon it by reascn of i t s c:m ~ e p u t a t l o n

2nd -.he

extent of

i t s busmess as an im2ortz11i uni t

the

motor

vehic le t rade ,not to mis lead the sec t lon

the publ ic

2 c ~ t e r e s t e d i n p u r c h x l n g a

motor

vchlc ic , a rd

lIl?.t

I t

?-rr::~.nec!

i n e t t e n t i v e

and

complacent

even

3.Pter ~t krlEw

t h a i It.:

assumption

that the

unverified

sta tell c ; a t s

~t l;ind au

t!lal'.Lzc;:d

wa'c

t r u e was

inva l ld .

18.

-4nd

t h e r e c a n b e l i t t l e

dcui, t.

t ha t po ten t i a l

purchasers of 8C)e and 1300 m3dels m y w1.l ~ C L ~ - C

been

mater ia l ly inf luenced

b e l l e f t h z t t h e c w s

had

.%ry/o-

'assisted

brakes.

Although

they

nay

113t have h:.d

any ; r ' c ' r ~ s e

ldea of

the nature

x c h q u i p n e n i

the gcacral no t ion tha t

mechanlcolly assisted

brake:

cord;rJ.LnltI-, tr, sa re ty 2nd

p e r f o r x x e i s wldcly k l d .

It must a l s o be remembered tkt a motoi- vehicle

i s normally an infrecyent

but

necescai-y, lmportmt

ard

expenslve inve

tmeni m the budget

o f ar: 3verage zan, :

t o which most persons give

rmch

tho3,;tlt

assessing thr

v l r t u e s of

var ious makes

and

I n r e z p ~ c i :

oJ whch Lhey probably

do rcad an? r e l y on the adv::rtlsements.

the

in f luence

o f

the

lncorret- t

repruscr ta t lon.

Secorldi):,

tile

degree thzl : the represmtat lon

deparLh irom t

t r u t h , t h . ~ ~ ~ d l y ,

the degree

o f

v i l f u l n e s s

o r

carelcssncsr In

the

lhdcmc 01 the

incorrect representat ion, fourthly t r lc extent

r h l t

tl-e

representa t ion was

dlsseminated, f l f t r l iy

7d1ct!1~ r

any

;nci

I.~I!~I,

I e f f o r t s have been

mad?

t o c o r r e c t

any

f a l s e

i.rtpre;.,sions !Ltlch

may have

been

created.

Finally,

th? objectives of t he l-.c,t.

cf Hartcell	v.	S:?AI-:~,	Ccrporatl:)n o f Cu.7 trn! L,? P'i'q.	Lta. -	.
5 A.L.H. b93.

. .

1\10

e f f o r t s were

mcde

the de fendmt to co r rec t

any false i r rpressioas created

by the i1'r'C)neous pch1lc::;tr:

0x1s.

Although

there

a r e seven chcrges,

II; h f?ir

recognise

that

they

a l l a r i se out

the or:&~lxli

apprL)vr.l G f

the rough copy.

It would be undu ly punl t lve t.0 l o o k ~ e p r . ~ : c l y

a t each ~aT' t lcu1ar charge agamst

the

r,cximu~~:

pmity cf

$50.000

which Parl lament nas set in

re la t ior .

t o this

kirtd

offence.

Nevertheless,

Irould

::rang t o t r e a t t h x a l l

one

offence, because the

v e r y decls ion whlch

1.3s mac??

n e v l t a b l y r e s u i t e d

~n the conmirslsn

o f

reI;edLcd

o f f t rxcc .

21.

it enJoins should a c t w i l y be -the :.l,cAnd?rds yre-b,a:.ling

i n t r ade

and

corrlerce.

I ts purpocc. i:.

n o t thz t such

contrav?n%:.onr

a s mey cccur :;hould be	pwlished but that contraventions	shall
n o t occur.

Accordlngly, subJect

t o thc observ2 t lon

abo-m

concerning the

risk

agpropr ia te ? (na l ty hemg Gpyxss lve

i n a

par t icu lar case

,it s x m s

c l e m k h a t

pen;?li;iec, impseci

the Court ought t o be

sucn as to r c f l ec t . t hc

rkgree of

culpF<bili ty

involved and t o have pi de

t e r r en t quz l l t y .

I-LI

current circumstances the decllne

money

values

i s

re levant .

cwsider the contravcnt1ocs

t h c defclldx7.t

t o

s e n o u s .

They were

t h e

r c s u l t

carclcssness ,

bur

contraventions

due

to cs re lessness a re not per rn lss lb lc

m 6 must

punished.

O f course such con:.l..l-ventlons

z r e

n o t

i n

L;%e

same order of cu lpab i l i t y as those ir;volvlrlL a

x t e l l t m n t o

deceive.

Taklng

into

consl?erat,lon

t h e oljsr-rvaticlrx ?Love

cons ider pena l t i es to t3 l l ing

$20,000

t o be

zpproprsat.e,

t h i s

sun being apphcable as

$4,000 In r e spec t

the f i i . . t two

charges and a s t o $16,000 1:1	resp:?ct or^ the rcmxnlng	i L v ~
charges.

Accordlrrgly I lmgose penal t i e s CS

follows -

2%.

On summons

and.

informatlon VG 3 of 1977

(B No. 379	of 1975)	$2,020
On summons	and information VG 4 of 1977
(B No. 380	of 1975)	$4,090

On summons

and information

VG 5 of 1977

( B No.

381

of 1975)

$4,003

On summons

and information

VG 6 of

1977

( B No.

382

of 19751,

and

$4,000

On summons

and information

VG 7 of 1977

( B No.

383

of 1975)

$‘,OCiO

The Court orders accordingly

and i n each c r se

w i t h

cos t s .

[1977] FCA 17

22 Apr 1977