Gardam, V.J. v Splendid Enterprises Pty Ltd

[1987] FCA 187

! , P ,

I

TRADE PRACTICES - c o n s u m e r p r o d u c t s a f e t y s t a n d a r d - c h i l d r e n s

l n i g h t c l o t h e s - f i r e r i s k labelling - s u p p l y oE n i g h t d r e s s e s

w i t h o u t r e q u i r e d f l r e r l s k w a r n i n g - m l s l a b e l l e d t o l n d i c a t e

I

r e d u c e d	f l r e	h a z a r d	-	prosecut lon	for	c o n t r a v e n t i o n	o f	s s . 5 3 ( A )
a n d	6 2 of	T r a d e	P r a c t l c e s	Act	-	f a c t o r s	r e l e v a n t	t o p e n a l t y -

I

u n i n t e n t i o n a l m l s l a b e l l i n g - f a m i l y c o m p a n y - s m a l l n u m b e r of

I I

I	emp loyees -	Impor t ance of	s a f e t y	s t a n d a r d s .
!
I
i

T r a d e P r a c t l c e s	Act	1974
T r a d e P r a c t i c e s R e v i s i o n	Act	1986

P e r t h

VERNON J O H N GARDAM V SPLENDID	ENTERPRISES	PTY LTD
WAG 17 OF 1987
FRENCH J.
16	A p r i l	1 9 8 7

I N THE FEDERAL COURT 1

OF	A U S T R A L I A	1
~~
WESTERN	AUSTRALIA	j
DISTRICT	REGISTRY	1

GENERAL D I V I S I O N 1 NO. WAG 1 7 Of 1987

I

B E T W E E E N :  r E R N O M JOHN GARDAM

I P r o s e c u t o r

and

SPLENDID ENTERPRISES PTY LTD

I Defendant

MINUTE OF ORDER

J U D G E MAKING ORDER:  FRENCH J.

DATE OF ORDER:  1 6 APRIL 1987

I

WHERE MADE: P e r t h

THE COURT ORDERS THAT:

1. T h e d e f e n d a n t 1s c o n v i c t e d on i t s p lea of g u i l t y o n e a c h

o f t h e f o u r c o u n t s i n t h e i n f o r m a t i o n .

2. T h e d e f e n d a n t is f i n e d i n respect o f t h e f o u r c o u n t s a s

follows:-

(1) on t h e f l r s t c o u n t - $ 2 , 0 0 0 . 0 0

(11) o n t h e s e c o n d c o u n t - $ 500.00

( i i i ) o n t h e	t h i r d c o u n t	-	$	500.00
( l v ) on	t h e	f o u r t h c o u n t	-	$ 2 , 0 0 0 . 0 0

3 . T h e d e f e n d a n t i s to pay t h e p r o s e c u t o r ' s costs t o be

t a x e d .

i

Note:  S e t t l e m e n t a n d e n t r y o f o r d e r s is d e a l t w l t h

i n O r d e r 36 o f t h e Federal C o u r t R u l e s .

- . A--.?- . . - -. -. _. _ _ L- .---, -.

,__ . , _ _ L.;.:.

. . . .

. . . . ___ - . - - .

I

I	I N THE FEDERAL COURT	)
I
I	OF AUSTRALIA	1

WESTERN	AUST ALIA	1
DISTRICT	REGISTRY	1

G E N E R A L D I V I S I O N 1 NO. WAG 17 O f 1987

B E T W E E N :  VERNON JOHN CARDAM

I

P r o s e c u t o r

and

SPLENDID ENTERPRISES P'IY L'ID

Defendan t

CORAM :  FRENCH J .

16 A p r i l 1 9 8 7

I

REASONS FOR JUDGMENT

!

S p l e n d i d E n t e r p r i s e s P t y Ltd is a fami ly company which

h a s f o r c h i l d r e n s n l g h t d r e s s e s . t h e p a s t 8 y e a r s m a n u f a c t u r e d a n d s u p p l i e d "Jol ie" b rand

I n F e b r u a r y 1986 t h e company supp l l ed t o a w h o l e s a l e r ,

George Wills & C o . L t d , a q u a n t i t y o f t h e n i g h t d r e s s e s b e a r i n g a

l a b e l w i t h t h e reassur ing t e x t "STYLED TO REDUCE FIRE DANGER".

The message o n t h e l a b e l s was f a l s e . To a c c o r d w i t h t h e

r e l e v a n t s t a t u t o r y s t a n d a r d w h a t h e c l o t h e s s h o u l d h a v e c a r r i e d

was a w a r n i n g i n t h e f o l l o w i n g terms:-

"WARNING

H I G H	FIRE	DANGER
KEEP AWAY	FROM	F I R E "

i

a n d t o r e i n f o r c e t h e t e x t i t s h o u l d h a v e s u r m o u n t e d a t r i a n g u l a r

logo c o n t a i n i n g a flame.

When a c h l l d w e a r i n g n i g h t c l o t h e s comes i n t o con t a c :t

w i t h f i r e t h e r l s k a n d s e v e r l t y o f b u r n s t h a t I t c a n s u f f e r may be

a f f e c t e d	by	t h e d e s i g n	a n d	f a b r l c	t y p e o f	t h e	n l g h t c l o t h e s	t h a t	i t
w e a r s .

T h e s t a n d a r d c o n t r a v e n e d I n t h l s case w a s i n t r o d u c e d t o

r e d u c e	t h e	r i s k	a n d s e v e r i t y o f b u r n s s u f f e r e d	by	c h i l d r e n	i n	s u c h
a c c i d e n t s	a n d ,	b y	a p p r o p r i a t e	l a b e l l i n g ,	t o m a k e	p a r e n t s	more

conscious	o f	t h e	r	l a t i v e	risks	of	d i f f e r e n t	c a t e g o r i e s	o f
g a r m e n t s .

I t 1s f a l s e l a b e l l i n g i n c o n t r a v e n t i o n o f t h e s t a n d a r d

w h l c h b r i n g s t h e c o m p a n y , t h e d e f e n d a n t i n t h e s e p r o c e e d l n g s ,

b e f o r e t h e C o u r t c h a r g e d on 4 c o u n t s w i t h c o n t r a v e n t i o n s of t h e

T r a d e Practlces Act 1974 .

T h e c h a r g e s are a s f o l l o w s : -

"1. THAT o n or a b o u t 20 Februa ry 1986 a t P e r t h i n t h e

S t a t e o f Western A u s t r a l i a S p l e n d i d E n t e r p r i s e s

P t y .	L t d . ,	o f	6	L y a l l S t r e e t , S o u t h P e r t h	a f o r e s a i d
d i d	commit	a n o f f e n c e b y c o n t r a v e n i n g	s ec t ion	7 9 ( 1 )

o f t h e s e c t i o n T r a d e P r a c t i c e s Act 1 9 7 4 by c o n t r a v e n i n g

5 3 ( a ) o f t h e s a l d Act i n t h a t , i n t r a d e or

commerce I n c o n n e c t i o n w i t h t h e s u p p l y of g o o d s ,

namely "Jo l le" b r a n d c h i l d r e n s n l g h t d r e s s e s , t h e

s a i d S p l e n d i d E n t e r p r i s e s P t y . L t d . d i d f a l s e l y

r e p r e s e n t	b y	m e a n s	o f	l a b e l s	a t t a c h e d	t o	t h e	s a i d
g o o d s ,	t h a t	t h e	s a i d	g o o d s	were	of	a	p a r t i c u l a r

s t a n d a r d , n a m e l y t h a t h e y were " S t y l e d To Reduce

F i r e Danger".

2 . A N D FURTHER THAT o n o r a b o u t 6 March 1986 a t

I n n a l o o i n t h e S t a t e o f W e s t e r n Aus t r a l i a S p l e n d i d

E n t e r p r i s e s P t y . L t d . o f 6 L y a l l S t r e e t , S o u t h

P e r t h a f o r e s a i d d l d c o m m i t a n o f f e n c e c o n s t i t u t e d

by Sec t ion 7 9 ( 1 ) Of the Trdde P L d C t l C e S A c t 1974 by

c o n t r a v e n l n g s e c t l o n 5 3 ( a ) of t h e s a i d Act I n t h a t ,

I n t r a d e n l g h t d r e s s e s , o r commerce I n c o n n e c t i o n w i t h t h e s u p p l y

of goods , name ly "Jo l le" b r a n d c h i l r e n s

t h e s a l d S p l e n d i d E n t e r p r i s e s P t y .

L t d . d i d f a l s e l y r e p r e s e n t b y m e a n s o f l a b e l s

a t t a c h e d t o t h e s a l d g o o d s , t h a t t h e s a l d g o o d s

were of a p a r t l c u l a r s t a n d a r d , n a m e l y t h a t t h e y

were " S t y l e d To Reduce F i r e Danger" .

3 . A N D FURTHER THAT on 2 J u l y 1 9 8 6 a t I n n a l o o i n t h e

S t a t e of Western A u s t r a l l a S p l e n d l d E n t e r p r i s e s

P t y . L t d . o f 6 L y a l l S t r e e t , S o u t h P e r t h a f o r e s a l d

d i d commlt a n o f f e n c e c o n s t l t u t e d by sec t ion 7 9 ( 1 )

o f	t h e	T r a d e	P r a c t l c e s	Act	1 9 7 4	b	y	c o n t r a v e n i n g
s e c t i o n	5 3 ( a )	o f	t h e	s a l d Act	i n t h a t ,	i n	t r a d e	or

commerce I n c o n n e c t i o n w l t h t h e s u p p l y of g o o d s ,

namely " Jo l i e " b r a n d c h l l d r e n s n l g h t d r e s s e s , t h e

s a i d S p l e n d i d E n t e r p r i s e s P t y . L t d . d i d f a l s e l y

r e p r e s e n t	by	means	of	l a b e l s	a t t a c h e d	to	t h e	s a l d
g o o d s ,	t h a t	t h e	s a i d	g o o d s	were	of	a	p a r t i c u l a r

s t a n d a r d , n a m e l y t h a t h e y were " S t y l e d To Reduce

F i r e Danger".

4 . AND FURTHER THAT on or a b o u t 20 Februa ry 1986 a t

P e r t h	i n	t h e	S t a t e	of	Western	A u s t r a l l a	S p l e n d l d
E n t e r p r i s e s	P t y .	L t d .	of	6	L y a l l	S t r e e t ,	S o u t h

P e r t h	a f o r e s a i d	d i d	c o m m i t	a n	o f f e n c e	c o n s t i t u t e d
b y s e c t i o n 7 9 ( 1 )	of	t h e T r a d e	Practices	Act	1974	by

c o n t r a v e n i n g s ec t ion 6 2 ( l ) ( a ) o f t h e s a i d Act, i n

t h a t t h e t r a d e o r commerce s a i d S p l e n d i d E n t e r p r i s e s P t y . L t d . , ~n

d i d s u p p l y g o o d s t o George Wills

a n d C o . L i m i t e d w h i c h were o f a k l n d l l k e l y t o b e

I

used by n i g h t d r e s s e s , a consumer , namely , " Jo l ie" b r a n d c h i l d r e n s

b e i n g g o o d s of a k i n d i n r e s p e c t of

which there was a p r e s c r i b e d c o n s u m e r p r o d u c t

s a f e t y s t a n d a r d n i g h t c l o t h e s d e c l a r e d c h i l d r e n s

r e s p e c t 6 3 A A ( 1 ) o f I n

i n a no t i ce u n d e r sec t ion

o f t h e s a i d Act a n d p u b l i s h e d i n t h e

Commonwea l th	o f	Aus t r a l i a	Gaze t t e	No.	S215	o f	1 9
J u n e	1 9 8 5 ,	w h i c h	s a i d	g o o d s	d i d	n o t	c o m p l y	w i t h

t h a t s t a n d a r d ."

To e a c h of t h e m t h e d e f e n d a n t p l e a d s g u i l t y .

The S t a t u t o r y Framework

P r i o r t o 1 J u l y 1 9 8 6 s.63AA o f t h e T r a d e P r a c t i c e s Act

I

1 9 7 4 a u t h o r i s e d t h e r e l e v a n t M i n l s t e r ( i n t h i s case t h e A t t o r n e y

I

.

I -

Gcncra l ) , by no t i ce In t h e G a z e t t e , t o d e c l a r e t h a t a s t a n d a r d

p r e p a r e d	or	a p p r o v e d	b y	t h e	S t a n d a r d s	A s s o c l a t l o n	of	Aus t r a l l a
w i t h	a d d l t l o n s	o r	v a r l a t l o n s	s p e c l f l e d	i n t h e	n o t i c e ,	was	a

consumer	p r o d u c t	s a f e t y	s t a n d a r d	f o r	t h e	p u r p o s e s	O E	s.62	of	t h e
Act.

S u b - s e c t i o n GZ(1) o f t h e Act p r o v i d e d : -

" A c o r p o r a t i o n s h a l l n o t , i n t r a d e or commerce, supply

g o o d s t h a t are i n t e n d e d t o be u sed , or are of a k i n d

l i k e l y t o be u s e d , by a c o n s u m e r I f t h e g o o d s are o f a

k i n d	-
( a )	i n r e s p e c t o f w h i c h t h e r e is a p r e s c r i b e d c o n s u m e r
p r o d u c t s a f e t y s t a n d a r d a n d w h i c h do n o t c o m p l y
w i t h t h a t s t a n d a r d : . . . . ' l
P a r a g r a p h ( a ) of s . 5 3 o f t h e Act p r o v i d e d t h e n , a s I t

d o e s	now:-
" A c o r p o r a t l o n s h a l l n o t , i n t r a d e o r commerce, i n
c o n n e x l o n w i t h t h e s u p p l y o r p o s s i b l e s u p p l y of goods or
s e r v i c e s o r i n c o n n e c t i o n w i t h t h e p r o m o t i o n b y a n y
m e a n s - o f t h e s u p p l y or u s e o f g o o d s or s e r v i c e s -
( a ) f a l s e l y s t a n d a r d , r e p r e s e n t h a t goods are of a p a r t i c u l a r

q u a l l t y , g r ade , c o m p o s i t i o n , s t y l e o r

model or have had a p a r t i c u l a r h i s t o r y or

p a r t l c u l a r p r e v i o u s u s e ; . . . ."

- - ..

S u b s e c t i o n 6 2 ( 1) p a r a . a n d 5 3 ( a ) i m p o s e d t h e

._ ,._ pr_off ib&tions i- *-

which are mater ia l for p r e s e n t p u r p o s e s .

. _

~. .

T h e p e n a l t i e s f o r t h e i r c o n t r a v e n t i o n are f l x e d b y s.79

w h i c h , p r l o r t o 1 J u n e 1 9 8 6 i n c l u d e d t h e f o l l o w i n g p r o v i s i o n s : -

!

l	*
l	5 .

"1.	A person who contravenes a provision of Part V
other than section 52 is guilty of an offence punlshable on convictlon -
(a) In the case of a person not belng a body

corporate - by a flne not exceeding $10,000;

or

(b) In the case of a person belng a body corporate

- by a flne not exceeding $50,000.

2.     Where a person 1s convlcted of two or more offences constituted by or relating to, contraventions of the same provlsion of Part V, being contraventions that appear to the court to have been of the same nature o r a substantially similar nature and to have occurred at or about the same tlme (whether or not the person is also convicted of an offence or

offences constituted by, or relatlng to, another

contraventlon or other contraventions of that provision that were of a different nature or occurred at a different time), the court shall not,

in respect of the first-mentioned offences, Impose on the person fines that, in the aggregate, exceed

the maximum flne that would be applicable in

respect of one offence by that person against that
provision."

The section was amended by the Trade Practices Revision

- Act 1986 with effect from 1 June 1986 to embrace accessorlal

liability and to increase the level of maximum	penalties
appllcable.

Sub-section ( 1 ) now reads:-

" A person who -

(a) contravenes:

(b) aids, abets, counsels or procures a person to contravene :

(c) induces, or attempts to Induce, a person

i	whether by threats	or promises or otherwise,
to contravene:

.__---.

I

( c i ) is ln any way, dlrectly or Indirectly,

knowingly concerned In, or party to, the

contraventlon by a person of;

or

(e) consplres wlth others to contravene,

a provislon of Part V other than sectlon 52, 52A, 650 or 65R or sub-sectlon G5F(9) is guilty of an offence punlshable on conviction -

(f) in the case of a person not belng a body

corporate - by a fine not exceeding $20,000;

or

(g) in the case of a person belnq a body corporate

- by a fine not exceedlng $100,000."

The amendlng Act also repealled ss.62 and 63AA with

effect from 1 July 1986.

In lieu of these and related provisions it introduced

Division 1A - Product Safety and Product Information into Part V of the Act.

The ministerial power to declare consumer products

safety standards 1s now to be found in s.65E which forms part of

the new Divislon.

Prohibitions of the klnd formerly imposed by s.62 of the

Act are now to be found in s.65C.

Paragraph 53(a) 1s not directly affected by the 1986

amendments.

The Minister's Notlce

A c t i n g p u r s u a n t t o h l s powers under sub-s .63AA(1) the

Mlnister d l d o n 19 June 1985, by no t l ce I n t h e G a z e t t e d e c l a r e a

Consumer P r o d u c t S a f e t y S t a n d a r d f o r c h i l d r e n s n l g h t c l o t h e s .

The not ice i n t h e r e l e v a n t p a r t s provided:-

"NOW THEREFORE I , L l o n e l Bowen, A t t o r n e y General o f t h e

Commonweal th o f Aus t ra l ia hereby:

I ( i i ) d e c l a r e t h a t , i n r e s p e c t o f g o o d s s p e c i f i e d i n

D i v l s l o n 1 of t h e S c h e d u l e t o t h i s n o t i c e , t h e

s t a n d a r d s s p e c i f i e d I n D i v i s i o n 2 of t h e S c h e d u l e

a s v a r i e d b y t h e v a r i a t i o n s s p e c i f i e d I n D i v i s i o n 3

t h e o f S c h e d u l e 1s a consumer p r o d u c t s a f e t y

s t a n d a r d f o r t h e p u r p o s e s of s e c t i o n 6 2 o f t h e

T r a d e P r a c t i c e s Act 1974.

'THE SCHEDULE

D i v i s l o n 1: P a r t i c u l a r s o f g o o d s .

~

C h i l d r e n s	n i g h t c l o t h e s	I n c l u d i n g	p y j a m a s ,
p y l a m a - s t y l e	o v e r g a r m e n t s ,	n i g h t d r e s s e s ,	d r e s s i n g

gown a n d i n f a n t s l e e p b a g s ( b u t n o t i n c l u d i n g a n y

a r t i c l e o f head wea r , footwear, or hand wear) of

a n y o f	t h e	s 1 z e s	0	t o	1 4 a s s p e c i f i e d i n	A u s t r a l i a n
S t a n d a r d	1 1 8 2 - 1 9 8 0	" S i z e	C o d i n g	S c h e m e	f o r	I n f a n t s '
a n d	C h l l d r e n s	C l o t h l n g	( U n d e r w e a r	a n d	Outerwear)",

p u b l l s h e d b y t h e S t a n d a r d s A s s o c i a t i o n o f A u s t r a l i a

on 1 September 1980.

D l v l s l o n	2:	The	S	tandard
( a )	A u s t r a l i a n	S tanda rd	1249-1983 ,	" C h l l d r e n s

N igh tc lo thes Hav ing Reduced F i r e Haza rd" ,

p u b l l s h e d by t h e S t a n d a r d s Assoclation of

A u s t r a l i a o n 2 May 1983; or

A u s t r a l i a n ( b ) S t a n d a r d 1 2 4 9 - 1 9 8 3 , " C h l l d r e n s

N igh tc lo thes Hav lng Reduced F i r e Haza rd" ,

p u b l l s h e d b y t h e S t a n d a r d s Associatlon o f

A u s t r a l i a o n 2 May 1983 , as amended by

Amendment No. 1 of 4 A p r l l 1 9 8 5 .

I

l

I .

8.

D i v l s l o n 3 : V a r l a t l o n s

T h e A u s t r a l l a n S t a n d a r d s s p e c i f i e d i n D l v l s l o n 2 ( a )

1s	v a r i e d	b y	d e l e t i n g	c l a u s e	1 . 2 .	The	A u s t r a l l a n
S t a n d a r d	s p e c l f l e d	In	D i v l s i o n	2 ( b )	is	v a r l e d	b y

d e l e t l n g c l a u s e 1 . 2 .

D a t e d t h i s 7 d a y of J u n e 1985.

L I O N E L BOWEN

A t t o r n e y G e n e r a l "

A u s t r a l i a n S t a n d a r d R e l a t l n g t o C h i l d r e n s N i g h t c l o t h e s

Havlnq Reduced F l re Hazard

The s t a n d a r d w h l c h w a s t h e s u b j e c t of t h e M l n l s t e r ' s

no t lce a n d t h e r e f o r e a consumer p r o d u c t s a f e t y s t a n d a r d f o r t h e

p u r p o s e s o f t h e Act, w a s p r e p a r e d b y t h e Committee o n B u r n i n g

B e h a v i o u r o f T e x t i l e s a n d T e x t i l e P r o d u c t s e s t a b l i s h e d b y t h e

S t a n d a r d s Assoclation o f A u s t r a l i a .

I t is a committee on w h i c h S t a t e a n d F e d e r a l Governments

a n d i n s t r u m e n t a l i t l e s , l n d u s t r y a n d c o n s u m e r I n t e r e s t s a n d v a r i o u s

s c i e n t i f i c b o d l e s are r e p r e s e n t e d .

T h e s t a n d a r d is d i v i d e d i n t o v a r l o u s S e c t i o n s . By c l a u s e

1.5 S e c t i o n o f 1 it d e f i n e s t h r e e categorles of c h i l d r e n s

n i g h t c l o t h e s : -

"1.5 CLASSIFICATION. C h i l d r e n s n i g h t c l o t h e s s h a l l b e

c l a s s i f i e d f o r t h e p u r p o s e of l a b e l l i n g a s follows:

C a t e g o r y 1 - Garments made from f a b r l c o f t h e low

f i r e h a z a r d t y p e a n d w h i c h c o m p l y w i t h section 2. !

These	garments	i n c l u d e	p y j a m a s ,	p y j a m a - s t y l e
o v e r g a r m e n t s ,	n l g h t d r e s s e s ,	d r e s s i n g	o w n s ,	i n f a n t

s l e e p b a g s a n d t h e l l k e .

C a t e g o r y	2	-	G a r m e n t s	d e s i g n e d	t o	r e d u c e	f l r e
h a z a r d	a n d	w h i c h	c o m p l y	w l t h	sec t lon	3 .	T h e s e

g a r m e n t s i n c l u d e p y ~ a m a s a n d p y ~ a m a - s t y l e o v e r

g a r m e n t s .

C a t e g o r y 3 - Garments s u c h a s p y j a m a s , p y ~ a m a - s t y l e

o v e r g a r m e n t s , n i g h t d r e s s e s , d r e s s i n g g o w n s , l n f a n t

s l e e p b a g s w h l c h c o m p l y w i t h sec t ion 4 b u t d o n o t

c o m p l y w l t h s e c t i o n 2 or sect ion 3 . "

S e c t i o n s 2 , 3 a n d 4 o f t h e s t a n d a r d t h e n s e t o u t

r e q u i r e m e n t s f o r c a t e g o r y 1, 2 and 3 g a r m e n t s r e s p e c t l v e l y .

S e c t l o n 5 p r e s c r i b e s labelling r e q u i r e m e n t s for e a c h

c a t e g o r y .

I n p a r t l c u l a r c l a u s e 5 . 1.1 p r o v i d e s : -

" F i r e H a z a r d . C h i l d r e n s n i g h t c l o t h e s h a l l b e l a b e l l e d

w i t h a d u r a b l e a n d p e r m a n e n t l y f i x e d l a b e l

l n d l c a t i n g t h e f l r e h a z a r d i n a c c o r d a n c e w i t h t h e

c l a s s i f i c a t i o n s t a t e d i n c l a u s e 1 . 5 . T h e l a b e l

s h a l l b e a r s t a t e d i n Appendix t h e words and symbols s e t o u t i n t a b l e

5 .1 a n d s h a l l c o m p l y w i t h t h e l a b e l s p e c i f i c a t i o n

B."

T a b l e 5 .1 r e q u i r e s c a t e g o r y 1 g a r m e n t s t o b e l a b e l l e d

"LOW F I R E DANGER" a n d c a t e g o r y 2 g a r m e n t s t o b e l a b e l l e d "STYLED

TO REDUCE	F I R E DANGER".
C a t e g o r y 3 garmen t s however m u s t b e a r a warn ing i n t h e
f o l l o w i n g	terms:-

I
:

. ,

,I '

10.

I

i 'I WARN I NG

I H I G H FIRE DANGER

K E E P AWAY FROM F I R E "

I I

I

a n d i t s t e x t is t o s u r m o u n t a t r i a n g u l a r l o g s i n c o r p o r a t i n g a

I

s t y l l s e d f l a m e .

i

i	D l s s e m i n a t i o n	of	t h e S t a n d a r d
1
I
~
I

T h e s t a n d a r d h a s b e e n p u b l i c i s e d n o t o n l y b y t h e f o r m a l

i !

not ice a p p e a r i n g i n t h e Gaze t te b u t a l s o i n a more d l g e s t i b l e form

b y t h e T r a d e P r a c t i c e s C o m m l s s l o n .

I

I n p a r t l c u l a r , t h e C o m m l s s l o n p u b l i s h e d I n M a r c h 1 9 8 4 a

I

c i r c u l a r	e n t i t l e d	" M a n d a t o r y	S t a n d a r d s	u n d e r	t h e	The	Trade
P r a c t i c e s	Act:	F l a m m a b i l i t y	S a f e t y	S	a n d a r d	C h i l d r e n s	f o r

N i g h t c l o t h e s " .

The c l r c u l a r c o n t a i n e d a summary of what i t d e s c r i b e d as

" T h e B a s i c F l a m m a b i l l t y R e q u i r e m e n t s of R e v i s e d t h e S t a n d a r d t h e f o r

of C h i l d r e n s N i g h t c l o t h e s " .

I n s e t t i n g o u t t h e r e q u i r e m e n t s o f t h e s t a n d a r d i t

r e f e r r e d t o c a t e g o r y 2 a n d c a t e g o r y 3 g a r m e n t s a s f o l l o w s : -

!
I

" C a t e g o r y 2 Garments:

13. C a t e g o r y 2 Garments m u s t c a r r y a r e d p r i n t e d l a b e l

( w h i t e b a c k g r o u n d ) w h i c h s a y s "STYLED TO REDUCE

F I R E DANGER": t h a t m e a n s t h e s h a p e a n d s t y l e of t h e

garmen t reduces t h e r i s k o f i t c a t c h i n g a l l g h t . If

i t	does	c a t c h a l i g h t , t h e f a b r l c	w l l l	n o t b u r n v e r y
f a s t b e c a u s e	t h e	garment	i s close	f i t t i n g .

14. C a t e g o r y 2 c o v e r s b a b l e s a l l I n o n e s , t rack s u l t

t y p e s	a n d	o t h e r	c l o s e	f l t t i n g	n l g h t c l o t h e s	( s e e
p a g e s 1 0 m e a s u r e m e n t s	a n d	11	of	A S 1 2 4 9 - 1 9 8 3 ) .	O r d l n a r y	p y ~ a m a s

and "Baby Doll" t y p e s a r e s u l t a b l e i f t h e l r

a r e res t r ic ted t o those s t a t e d I n t h e

s t a n d a r d . T h e s e g a r m e n t s m u s t n o t be made f rom

f a b r i c s w h l c h h a v e a p l l e or n a p s u c h a s m o l l e t o n

o r c o t t o n c h e n l l l e which c a n s p r e a d f l a m e r a p i d l y

o v e r t h e s u r f a c e of t h e f a b r i c ( i . e . " f l a s h " ) The

u s e o f trims i n t h i s c a t e g o r y is restrlcted where

t h e y do n o t s a t i s f y t h e b u r n l n g or I g n i t i o n

r e q u i r e m e n t s f o r c a t e g o r y 1. (For f u r t h e r d e t a i l s

r e f e r to t h e s t a n d a r d ) .

i C a t e g o r y 3 Garments :

15. C a t e g o r y 3 g a r m e n t s m u s t b e a r a l a r g e r e d l a b e l

p r i n t e d i n b l a c k a s f o l l o w s :

l WARNING

HIGH FIRE DANGER

KEEP AWAY FROM FIRE

1 6 . T h i s c a t e g o r y is f o r c h i l d r e n s n i g h t c l o t h e s w h i c h

c a n n o t	be	c l a s s i f i e d	a s	e i t h e r	c a t e g o r y	1	or
c a t e g o r y	2 .	I f	t h e	f a b r i c	c a t c h e s	a l i g h t ,	t h e

g a r m e n t	will	b u r n	r a p i d l y ,	p a r t i c u l a r l y	b u t
d a n g e r o u s	f e a t u r e s	l i k e l o n g	f l o w i n g	s k i r t s a n d

f i e r c e l y b u r n i n g f a b r i c s are p r o h i b i t e d ."

C o u n s e l f o r t h e d e f e n d a n t i n f o r m e d t h e C o u r t t h a t h i s

c l l e n t h a d r e c e l v e d a copy of t h e c i r c u l a r p r i o r t o the commiss ion

o f t h e o f f e n c e s w i t h w h i c h i t is c h a r g e d .

C o n d u c t C o n s t l t u t l n a t he O f f e n c e s

A l t h o u g h t h e d e f e n d a n t 1s c h a r g e d w l t h 4 c o n t r a v e n t l o n s

o f t h e A c t t h e y r e l a t e I n s u b s t a n c e to t h e o n e t r a n s a c t l o n .

i

I i A s a p p e a r s f r o m a n a g r e e d s t a t e m e n t o f f a c t s t e n d e r e d b y

t h e p r o s e c u t o r , t h e d e f e n d a n t c a r r i e s o n b u s i n e s s i n Western

I

A u s t r a l l a a s	a	m a n u f a c t u r e r	a n d	s u p p l i e r	of	Jo l i e	brand	c h i l d r e n s
n i g h t d r e s s e s .

I

I T h e n i g h t d r e s s e s so m a n u f a c t u r e d are so ld t h r o u g h o u t

A u s t r a l l a .

I

For a p e r l o d o f a b o u t 8 y e a r s t h e d e f e n d a n t h a s s u p p l i e d

!

George Wllls & Co. L t d ("Wills") w l t h t h e g a r m e n t s .

l

On 27 November 1985 it r e c e l v e d f r o m Wills a n o r d e r f o r

I

t h e s u p p l y o f 2 1 8 J o l l e n l g h t d r e s s e s i n c l u d i n g 64 s i z e "0" and 36

s i z e "1" i n a s t y l e d e s i g n a t e d J N 1 . L

I

I
I

I

T h e n l g h t d r e s s e s were of a t y p e s u b j e c t t o the Consumer

/
!

P r o d u c t S a f e t y S t a n d a r d AS1249-1983.

!

I

i

I

i T h e y d i d n o t f a l l i n t o c a t e g o r y 1 a n d o n v i s u a l

i n s p e c t i o n i t was a p p a r e n t h a t h e s i z e "0" n i g h t d r e s s was n o t

w l t h i n t h e f o r m f i t t l n g d e s i g n l l m i t a t i o n s of c a t e g o r y 2 .

In spite of thls at least 5 of the garments supplled to

I Wills were labelled “ S T Y L E D TO REDUCE F I R E HAZARD”, the label

I	appllcable to a category 2 garment.
I

They are In fact category 3 garments and should have

I carrled the warning appropriate for that classification.

! The supply of the goods Wills to 20 on February 1986

constituted a contraventlon of the prohibition Imposed by

I I

I	paragraph 62(l)(a) of the	Act	and	thereby	an	offence	under
I	sub-s.79(1).
i

The contraventlon arose because the supply of the

wrongly labelled goods was a supply of goods of a kind likely to

be used by a consumer but not complying with the prescribed

consumer product safety standard.

!

Thus it constituted the offence charged in count 4 .

Essentially the same transaction gives rise to the

charge set out in count 1.

However the prosecutor has there fixed

i

upon the representatlonal aspect of the defendant’s conduct by

1. reference to the mislabelling and alleged a contravention of

j

paragraph 53(a) of the Act.

The part of that paragraph relevant for present purposes

j	refers to false representations	that goods are of a particular
I	I
I	standard.
I
l
i

I	- .
I

!

T h e

w

o

r

d

" s t a n d a r d "

a p p e a r l n g

i n

p a r a g r a p h

5 3 ( a )

1s

n o t

I

I d e f l n e d I n t h e Act.

The Minlster 's power t o d e c l a r e c e r t a l n p r e s c r l p t l o n s t o

be c o n s u m e r n r o d u c t s a f e t y s t a n d a r d s u n d e r sub-s .63AA(l ) is

l lmi t ed t o t h o s e w h i c h a r e "a p a r t i c u l a r s t a n d a r d , or a p a r t i c u l a r

I	p a r t	o f	a	s t a n d a r d	p r e p a r e d	a p p r o v e d	o r	by	t h e	S t a n d a r d s
I
I	A s s o c i a t l o n	o f	A u s t r a l i a	or	by	a	p r e s c r i b e d	a s s o c l a t i o n	or	body".
i
I

I am s a t l s f l e d t h e r e f o r e t h a t c o n s u m e r p r o d u c t s a f e t y

I s t a n d a r d s l a w f u l l y d e c l a r e d u n d e r s.63AA f a l l w i t h i n t h e g n u s

! " s t a n d a r d " t o w h i c h p a r a . 5 3 ( a ) r e f e r s .

As w i l l b e seen l a t e r i n t h e s e r e a s o n s , i t is n o t

a l l e g e d t h a t t h e r e p r e s e n t a t i o n s made were d e l i b e r a t e i n t h e s e n s e

I

t h a t i t may be s a i d t h a t t h e d e f e n d a n t or i t s p r i n c i p a l s knew t h a t

t h e garments were m i s l a b e l l e d . B u t s c h knowledge is n o t

n e c e s s a r y	i n	o r d e r	t h a t	a n	o f f e n c e	u n d e r	p a r a . 5 3 ( a )	may	b e
e s t a b l i s h e d .	It	is	a	p r o v i s i o n	w h i c h	a t t r a c t s	a	s t r i c t	l i a b i l i t y

- D a r w l n B a k e r y P t y L t d v S u l l e y ( 1 9 8 1 ) 3 6 ALR 371 a t 376.

The second c o u n t ar ises f r o m t h e s u p p l y b y Wills o f t h e

m i s l a b e l l e d g o o d s t o a r e t a l l e r o n or a b o u t 6 March 1986.

The re 1s n o t h i n g t o s u g g e s t t h a t t h e s u p p l y i n v o l v e d a n y

c o n d u c t	o n	t h e	pa r t	o f	t h e d e f e n d a n t b e y o n d	Its	o r i g i n a l s u p p l y	t o
Wills.

!
i

I

1 5 .

I	T h e	q u e s t l o n	w h e t h e r	t h e	d e f e n d a n t ' s	c o n d u c t	therefore
i

I amounted a l so t o a r e p r e s e n t a t i o n t o t h e r e t a i l e r p u r c h a s i n g f r o m

i	t h e wholesaler	1s o n e	o f	a c t .	I t	is	p o s s l b l e	t h a t	a	number	o f
i

r e p r e s e n t a t i o n s a s t o g o o d s w l l l be made t o a number o f pe r sons

u p o n s a l e by t h e m a n u f a c t u r e r t o a w h o l e s a l e d i s t r l b u t o r -

c f . B a r t o n	v	C r o n e r	T r a d i n g P t y L t d	( 1 9 8 4 ) 54	ALR	5 4 1 ,	a t	5 5 3 ,
Korczynsk i v	Wes	L o f t u s	( A u s t )	P t y	L t d	( 1 9 8 5 ) 6 2 ALR	225	a t 229.

I

T h e p l e a o f g u i l t y c o n s t i t u t e s a n a d m i s s i o n o f a l l

I

essential elements o f t h e o f f e n c e a n d m u s t I n t h i s c a s e b e t a k e n

a s a n a d m l s s l o n t h a t t h e r e p r e s e n t a t i o n a l l e g e d i n t h e s e c o n d

count was made.

l

!1

i

The t h i r d c o u n t arises f r o m t h e d i s p l a y b y a r e t a i l e r o f

t h e m i s l a b e l l e d g o o d s o n 2 J u l y 1 9 8 6 , t h e da te upon which they

l

were p u r c h a s e d b y t h e p r o s e c u t o r , a n o f f i ce r of t h e T r a d e

I p r a c t i c e s C o m m i s s i o n , i n t h e c o u r s e o f a p e r i o d i c c o m p l i a n c e c h e c k

o f g a r m e n t s o n d i s p l a y i n r e t a i l s tores .

A g a i n , n o f u r t h e r c o n d u c t o n t h e p a r t o f t h e d e f e n d a n t

w a s I n v o l v e d b e y o n d t h e o r i g i n a l s u p p l y o f t h e g o o d s t o Wills.

On 1 J u l y 1986 t h e r e p e a l o f s.63AA t o o k e f f e c t . The

I I

e f f e c t of t h a t r e p e a l u p o n c o n s u m e r p r o d u c t s a f e t y s t a n d a r d s

I

d e c l a r e d u n d e r t h e sec t ion was n o t c a n v a s s e d b e f o r e m e .

I

i

.- -

I.

I n a n y e v e n t t h e t h l r d c o u n t a l l e g e s a f a l se

r e p r e s e n t a t i o n t h a t t h e g o o d s were o f a p a r t i c u l a r s t a n d a r d I n

c o n t r a v e n t l o n of p a r a . 5 3 ( a ) . To e s t a b l i s h t h e c o n t r a v e n t i o n i t 1s

n o t n e c e s s a r y t o e s t a b l l s h t h a t t h e s t a n d a r d i n q u e s t i o n was a

d e c l a r e d consumer p r o d u c t s a f e t y s t a n d a r d .

W h e t h e r t h e r e p r e s e n t a t i o n r e l a t e d t o a s t a n d a r d f o r t h e

p u r p o s e o f p a r a . 5 3 ( a ) is a matter i n r e s p e c t of which I a c c e p t

t h a t b y t h e p l e a o f g u i l t y t h e r e h a s b e e n a n a d m i s s l o n o f a l l

r e l e v a n t f a c t s .

T h e g e n e r a t i o n o f f o u r c h a r g e s o u t o f o n e t r a n s a c t i o n i n

t h i s case , m i g h t b e s a i d t o i n d l c a t e a d e g r e e of p r o s e c u t o r i a l

o v e r k i l l .

I t is r e a s o n a b l y a r g u a b l e t h a t t h e f i r s t a n d f o u r t h

c o u n t s	c o v e r d i f f e r e n t a s p e c t s o f	t h e	t r a n s a c t i o n , o n e r e l a t i n g	t o
c o m p l i a n c e w l t h	t h e c o n s u m e r p r o d u c t	s a f e t y s t a n d a r d	and	t h e o t h e r

r e l a t i n g to t h e e l e m e n t o f a m i s r e p r e s e n t a t l o n a r i s i n g o u t of t h e

m i s l a b e l l i n g .

A c c e p t l n g t h a t , i t is d i f f i c u l t t o see w h a t u s e f u l

p u r p o s e is s e r v e d b y c o u n t s 2 and 3 . I n f i x l n g p e n a l t y I w l l l

h a v e r e g a r d t o t h e f a c t t h a t a l l t h e c h a r g e s ar ise o u t of t h e o n e

t r a n s a c t l o n .

I _ _ _ _

I

l/. .-

Background of Defendan t and C i r c u m s t a n c e s of O f f e n c e s

T h e d e f e n d a n t i s t h e f a m l l y c o m p a n y o f Mr & Mrs E l 1

Z o h a . Mrs Zoha o p e r a t e s a s a w o r k i n g d l r e c t o r r u n n i n g ~ t s

bus lness of a m a n u f a c t u r e r a n d s u p p l i e r o f c h l l d r e n s n i g h t d r e s s e s .

T h a t h a s b e e n b u l l t u p o v e r t h e l a s t 8 y e a r s t o t h e

p o i n t t h a t €or t h e y e a r e n d e d 3 0 J u n e 1 9 8 5 t h e g r o s s I n c o m e f r o m

f a c t o r y s a l e s was $352,596.00 . Mrs Zoha I n t h a t y e a r e c e i v e d a

s a l a r y o f $ 2 5 , 6 0 0 . 0 0 . Mr Zoha r e c e i v e d $ 3 4 , 0 0 0 . 0 0 .

T h e c o m p a n y d e r i v e d income f r o m w h a t were e v i d e n t l y

u n r e l a t e d sources i n t h a t y e a r . I was informed by c o u n s e l t h a t

t h e s e s o u r c e s o f i n c o m e were n o l o n g e r a v a i l a b l e t o it . Mr Zoha

n o l o n g e r r e c e l v e s a s a l a r y f r o m t h e d e f e n d a n t .

T h e d e f e n d a n t e m p l o y s some 1 2 p e r s o n s of whom 4 a r e

f u l l t i m e a n d 8 p e r m a n e n t p a r t t i m e workers.

I t h a s n o t p r e v i o u s l y b e e n p r o s e c u t e d or c o n v i c t e d for

a n y c o n t r a v e n t i o n of t h e T r a d e P r a c t i c e s A c t .

A c c o r d i n g t o a l e t te r w r i t t e n by Mrs Zoha t o t h e T r a d e

P r a c t i c e s Commiss ion	on	29	F e b r u a r y	1 9 8 6 ,	t h e	m i s l a b e l l i n g	was	a n
e r r o r .

l

I

18.

I	5 h e	had	been	aware	s h e s a l d f o r	s e v e r a l	y e a r s	t h a t	t he
I

I f i r e labelling o f c h l l d r e n s n l g h t w e a r was o f g r e a t I m p o r t a n c e .

1 I S h e h a d t a k e n p a l n s s h e s a l d , t o e n s u r e t h a t a l l

I I	n r g h t w e a r w a s c o r r e c t l y	l a b e l l e d .
I I I

I I T h e m i s l a b e l l e d b a t c h was t h e r e s u l t o f a n i n e x p e r i e n c e d

i	I	m a c h i n i s t w h o s e	w o r k	was	n o t	c h e c k e d b y	t h e	r e g u l a r p a c k e r .
I
I
i
I
I	A c c o r d l n g	t o	a n a f f i d a v l t	s w o r n b y	M	r	zoha , Mrs	Zoha was
I I

away on a b u s i n e s s t r l p a n d h e r r e g u l a r p a c k e r w a s i n h o s p i t a l a t

i

1 i t h e time t h a t t h e m i s l a b e l l i n g occurred. The t mpora ry pe r son

relieving t h e r e g u l a r p a c k e r f a i l e d t o de t ec t t h e errors.

i
!

I t was n o t c o n t e s t e d b y t h e p r o s e c u t o r t h a t t h e o f f e n c e s

were t h e r e s u l t o f u n l n t e n t i o n a l e r r o r .

I

C o u n s e l f o r t h e d e f e n d a n t t o l d t h e C o u r t t h a t h i s c l i e n t

h a d t a k e n s t e p s t o e n s u r e t h e r e c o u l d be n o r e p e t i t i o n of s u c h

c o n d u c t i n t h e f u t u r e .

These measu res were n o t s p e l t o u t . F u r t h e r , it a p p e a r e d

t h a t	t h e d e f e n d a n t	h a d n o t	t a k e n	a n y	s t e p s	t o a s c e r t a i n how	many,
if	a n y , o f	t h e	mlslabelled	garments	had	been	sold.

Nor h a d a n y c o n s i d e r a t i o n b e e n g i v e n t o a n y p u b l i c

n o t i f i c a t i o n b y t h e d e f e n d a n t o f t h e error so t h a t members o f the

I I

I

!	.-
I

p u b l l c who had p u r c h a s e d t h e l r g a r m e n t s m l g h t be a l e r t e d t o t h e

t rue p o s l t l o n w l t h r e s p e c t t o t h e l a b e l l l n g .

C o u n s e l t o l d t h e C o u r t t h a t t h e w h o l e e p l s o d e h a d been a

t r a u m a t l c o n e f o r Mr & Mrs Zoha.

Nelther were p r e s e n t i n C o u r t when t h e m a t t e r came o n

f o r t h e p e n a l t y h e a r l n g . T h e o n l y a f f i d a v i t tendered was g iven by

Mr Zoha.

No s t a t e m e n t o f t h e m e a s u r e s t o b e t a k e n t o e n s u r e

c o m p l i a n c e w i t h c o n s u m e r s a f e t y s t a n d a r d s i n t h e f u t u r e was g l v e n .

I

I m u s t confess t o b e i n g l e f t w i t h a f e e l i n g o f u n e a s e a s

t o w h e t h e r t h o s e s t a n d i n g b e h i n d t h e d e f e n d a n t e v e n now f u l l y

a p p r e c i a t e t h e s e r i o u s n e s s of t h e o b l i g a t i o n i m p o s e d i n r e s p e c t of

t h e l a b e l l i n g o f c h i l d r e n s n i g h t c l o t h e s .

P r i n c i p l e s R e g u l a t i n g D i s c r e t l o n I n A c t i o n F o r P e n a l t y

T h e a p p r o p r l a t e l e v e l of p e n a l t y t o be f i x e d w i l l v a r y

a c c o r d i n g t o t h e c i r c u m s t a n c e s of e a c h c a s e a n d t h e c l a s s of

r e l e v a n t c o n s i d e r a t l o n s 1s n o t closed.

N e v e r t h e l e s s it a p p e a r s t o be well e s t a b l i s h e d t h a t t h e

following m a t t e r s are r e l e v a n t to t h e p u n i s h m e n t t o be imposed.

I	I
I
I
i

1. The objectives of L I E A L L .

2.     The Importance of any untrue statement made.

3 .    The degree of wilfulness or carelessness involved In making such a statement.

4. T h e extent to which the statements ln question

depart from the truth.

5.    The degree of their dissemination.

6. The resulting pre~udice to consumers.

7.    Whether any and if so what efforts have been made to correct the statements.

8. The need to imuose deterrent uenalties. I Hartnell v 'Sharp Corporation (1975) 5 ALR 493,

Eva v Mazda Motors (Sales) Pty Ltd 119771 ATPR

40-020, O'Nelll v El Camlno Autos Pty Ltd (1980) 42 FLR 35, Dawson v World Travel Headquarters Pty Ltd (1981) 53 FLR 455

The sectlons of the Act which provide for the

declaration of consumer product safety standards and their

enforcement are plainly of the highest importance.

The substitution of a reassurance as to compliance with the approprlate standard for a statutorily required warning 1s a matter of considerable gravity.

In the present case the offences were not committed

wilfully or with any intention to deceive. Their commission was

the product of carelessness and lax management.

i

I As Smithers J. said in Eva v Mazda Motors (Sales) Pty

I

I	-	Ltd (supra) at 17309:-
I
I

"...Contraventions due to carelessness are not

permissible and must b e punished. Of course such

contraventlons are not in the same order of culpabllity

as those lnvoking an Intention to decelve."

The statement whlch comprlses the mlsrepresentation in

this case departs from the truth in the most radlcal way - it

offers reassurance when It should tender warning.

1

I

The degree of dlssemlnatlon is unknown but it is a

reasonable probability that some purchasers will have bought slmllarly mislabelled garments. As to the degree of prejudlce to consumers, that too is an unknown quantity.

I

It is plain that no efforts have been made to rectify

I

the problem arising from the mislabelling.

The need to impose deterrent penalties is accepted and

it 1s also accepted that they must not be so high as to be

I

I

oppressive - Crossan v Common [l9851 ATPR 40-542.

As the defendant has pointed out there has already been some publiclty adverse to it as a result of thls prosecution.

As to adverse publicity it has been said in Thompson v

J.P. Fossey Limited [l9781 ATPR 40-080 that It is often the

l	inevitable consequence of wrong doing and in most cases 1s wlthout
i
l	influence In the assessment of penalty.
I
I
i
i	I
I
l

I

' I

22.

I

I regard the contraventlon ~n thls case a s serious,

although caused by carelessness	rather than any deliberate
lntentlon to decelve.

I

In mltlgation the defendant is a vehicle through which family buslness IS conducted. There are a number of persons whose livellhood evidently depends upon the continuance of the business. Any flne Imposed on the defendant whilst being at a level a

sufficient to mark the seriousness of	the offences, must not	be so
high as to be oppressive.

I also have regard to the fact that each of the offences

sprlngs from a single transaction. On that basls I wlll impose

fines totalling $5,000.00 broken up in the following way:-

I

1.    As to the first count on the information - $2,000

2 .     As to the second count - $500.

3 .         As to the third count - $500.

4 .          As to the fourth count - $2,000.

The defendant wlll pay the prosecutor's costs.

!

I c e r t l f y t w e n t y two t h a t t h e p r e c e d l n g

( 2 2 ) pages a re a

I t r u e c o p y h e r e l n of t h e Reasons

€or Judgment of h i s Honour

Mr J u s t l c e F r e n c h .

I

Counse l :

. for t h e P r o s e c u t o r : Mr S . O ' S u l l l v a n

I n s t r u c t e d by t h e Director o f P u b l i c P r o s e c u t i o n s

. f o r	t h e	D e f e n d a n t :	E I r	N .	Viswal lngam
I n s t r u c t e d	by	C a s t i g l i o n e L	Bowen	L	C o .

!

Date H e a r i n g : o f 1 4 Apr i l 1987

Date Judgmen t : o f 16 A p r i l 1987