Trade Practices Commission v Omareef P/L

[1994] FCA 870

IN THE FEDERAL COURT OF AUSTRALIA                 ) 
  )  
NEW SOUTH WALES DISTRICT REGISTRY                )  NG 538-548 of 1994
  )     
GENERAL DIVISION  )     

BETWEEN:          TRADE PRACTICES COMMISSION     Applicant

AND:                   OMAREEF PTY LTD t/a QUICKSILVER WETSUITS

Respondent

Coram:        Davies J.
Date:          20 October 1994
Place:         Sydney

REASONS FOR JUDGMENT

This is the prosecution of Omareef Proprietary Limited on 11 separate charges.  The defendant has pleaded guilty to all charges.  I find Omareef Proprietary Limited guilty of each of the charges.  The question now is as to the penalty to be imposed. 

On wetsuits which Omareef Proprietary Limited ("Omareef") had imported from China, and on which it had done only a very little amount of work in Australia, Omareef changed the label from "Made in China" to "Made in Australia", and then exported the goods to the United States.  Evidence has been given by Mr Howett, a director of Omareef, that this was done because he felt that there might be a delay in the processing of the goods in the United States if they had carried the "Made in China" label.  He was under the impression that goods originating in Australia could be imported into the United States immediately, but that there could be delays for goods originating in China. 

There is no reason to doubt that this was the predominant factor that brought this matter about.  Nevertheless, the action involved deceit of United States Customs.  It also, necessarily, involved some deceit of the recipients of the goods, whether they be the 11 businesses to whom the goods were sold, or the ultimate consumers.  There was no attempt made, so far as the evidence shows, to inform the recipients of the goods that they were not made in Australia.  So there was an inevitable deception of United States Customs and of the consumers and traders in the United States.

This is conduct of a type which can reflect badly upon the Australian community.  It reflects on all exporters from Australia.  It is extremely important that each exporter make every endeavour to be honest in its dealings with traders in overseas countries, and with authorities such as the American Customs.  A good reputation for Australian goods and a good reputation for Australian manufacturers is a very important matter for the community.

Nevertheless, as Mr Whitford has pointed out, this is not a matter which is at the worst end of the scale. The 11 separate offences really involve one aggregate offence, and in accordance with s 79(2) of the Trade Practices Act 1974 (Cth) that is a factor which ought to be taken into account.

It appears that the total price of the goods was a little more than $25,000.  In these circumstances, I am of the view that a total figure of $25,000 would be appropriate.  I would divide it this way; by imposing a penalty of $20,000 in respect of the first offence and penalties of $500 in respect of the other 10 offences.  The respondent should pay the costs of the proceedings.

I certify that this and the 2 preceding pages
are a true copy of the reasons for judgment herein of
the Honourable Justice Davies.

Associate:

Date:     20 October 1994

Counsel for the applicant:                  Ms A.F. Backman

Solicitors for the applicant:                Commonwealth DPP

Counsel for the respondent:                Mr P. Whitford

Solicitors for the respondent:             Corrs Chambers Westgarth

Date of hearing:  20 October 1994

Date of judgment:  20 October 1994