Cox v Caton [2010] ICQ 13

CITATION: David Francis Cox AND John Anthony Caton (C/2009/58) - Decision <http://www.qirc.qld.gov.au> INDUSTRIAL COURT OF QUEENSLAND Industrial Relations Act 1999 - s. 341(2) - appeal against decision of industrial magistrate David Francis Cox AND John Anthony Caton (C/2009/58) PRESIDENT HALL 26 March 2010 DECISION [1] On 23 February 2009, Mr John Anthony Caton (the Respondent) was charged on one complaint and summons with two offences under s. 666 of the Industrial Relations Act 1999 (the Act) for failing to pay wages and moneys by way of pro rata annual leave due under an industrial instrument to a Mr Stevens. On the same day the Respondent was further charged on a separate complaint and summons with an offence under s. 406 of the Act for failing to make contributions to an approved superannuation fund at a level required by the industrial instrument. [2] Additionally, once again on 23 February 2009, the Respondent was charged on one complaint and summons with two offences under s. 666 of the Act for failing to pay wages and moneys by way of pro rata annual leave due under an industrial instrument to a Ms Collier and a further charge under s. 406 for failing to make contributions to an approved superannuation fund at a level required by the industrial instrument. [3] Each complaint and summons was properly served. Each of the complaints was listed for hearing before the Industrial Magistrate at Richlands on 6 April 2009. There was no appearance by the Respondent. The Respondent was ordered to pay all of the amounts specified in the complaints, in default levy on distress, in default imprisonment. No time for payment was specified in the orders. The Industrial Magistrate declined to convict and fine the Respondent on any of the four complaints because the complaints did not allege that the Respondent had committed an offence. [4] The Industrial Magistrate's refusal to convict on the four complaints was brought to this Court on Appeal. The Appeal was successful, see David Francis Cox v John Anthony Caton1. The power at s. 248(1)(e) of the Act was exercised to quash the proceedings in all matters initiated by the complaints in the Industrial Magistrate's Court and to quash the orders made therein by the Industrial Magistrate. Each of the matters was remitted to the Industrial Magistrate's Court at Richlands to be heard and determined according to law. [5] The matter was relisted for hearing on 12 October 2009. Again, the Respondent did not appear. The decision was reserved and delivered on 9 November 2009. The Industrial Magistrate convicted the Respondent of all offences charged but did not record a conviction on any charge. No Appeal is brought about that. On the complaint relating to failure to pay wages and moneys by way of pro rata annual leave to Mr Stevens, one penalty was imposed, viz., a fine in the sum of $2,000. On the complaint relating to pay wages and pro rata annual leave to Ms Collier one penalty was imposed, viz., a fine of $1,000. On the complaint relating to failure to make superannuation payments on behalf of Mr Stevens a fine of $500 was imposed. On the complaint about the failure to make superannuation payments on behalf of Ms Collier, a fine of $200 was imposed. Orders requiring payment of the outstanding wages, unpaid pro rata annual leave moneys, unpaid superannuation contributions and costs of court were also made and supported by orders to operate in the event of default. It is unnecessary to go to the detail of each of those orders. It is sufficient to say that (when made), the orders were defective in that the time for payment was not specified. The Appellant seeks to correct the orders and I shall grant that relief. As a matter of prudence, knowing little of the Respondent, I shall not provide for imprisonment if all else fails. In substance, this Appeal is about the fines imposed by the Industrial Magistrate. The quantum of each of the fines is said to be inadequate. [6] It is the submission of the Appellant that the Industrial Magistrate: (a) erred in law; and (b) imposed a series of sentences which were unreasonable or plainly unjust within the principle in House v The King2. If either submission is made out, this Court is entitled to and required to go behind what is admittedly the exercise of a discretion vested in the Industrial Magistrate and not vested in this Court, see Harris v The Queen3. [7] The Appellant contends that the Industrial Magistrate erred in failing to give effect to the change in the monetary value of a penalty point which occurred in 2009. The Industrial Magistrate said: 1 David Francis Cox v John Anthony Caton (2009) 191 QGIG 214 2 House v The King (1936) 55 CLR 499 at 504 to 505 per Dixon, Evatt and McTiernan JJ 3 Harris v The Queen (1954) 90 CLR 652 at 655 to 656 per Dixon CJ, Fullagar, Kitto and Taylor JJ -- 1 of 6 -- 2 "The complainant contends at paragraph 33 of the submission the defendant is liable to fines totalling $88,000.00. The penalty unit amount was increased to $100.00 as from 1 January 2009. The proceedings relate to a failure to make payments in 2007 at a time when the value of a penalty unit was $75.00. The maximum fines that can be imposed are $66,000.00 not $88,000.00. However, the two counts which form one complaint are so interconnected it would be inconceivable in my view to seriously argue the imposition of separate penalties for each count.". In normal circumstances, the Industrial Magistrate's conclusion would have been correct. The general rule appears at s. 180 of the Penalties and Sentences Act 1992 which provides: "180 Effect of alterations in sentences (1) If a provision of this or another Act increases the sentence, or the maximum or minimum sentence, for an offence, the increase applies only to offences committed after the commencement of the provision. (2) If a provision of this or another Act reduces the sentence, or the maximum or minimum sentence, for an offence, the reduction (a) extends to offences committed before the commencement of the provision; but (b) does not affect any sentence imposed before the commencement.". However, the circumstances are not normal. [8] A breach of s. 406, or of s. 666 of the Act is a continuing offence. The nature of an offence by way of a failure to pay amounts due under an industrial award was analysed by O'Bryan and Gillard JJ in R v Industrial Appeals Court; Ex parte Barelli's Bakeries Pty Ltd4. The critical (if lengthy) passage is: "On behalf of the informant it was contended that since the liability was continuing, the failure to comply was equally continuing and accordingly the offence charged is of a continuing nature. A continuous or continuing offence is a concept well known in the criminal law and is often used to describe two different kinds of crime. There is the crime which is constituted by conduct which goes on from day to day and which constitutes a separate and distinct offence each day the conduct continues. There is, on the other hand, the kind of conduct, generally of a passive character, which consists in the failure to perform a duty imposed by law. Such passive conduct may constitute a crime when first indulged in but if the obligation is continuous the breach through constituting one crime only continues day by day to be a crime until the obligation is performed. In such a case in measuring the period of limitation, if one is applicable, the right to lay an information is not barred if the breach has continued up to the day the information was laid or if the breach was cured before the information was laid, time counts from the day when the obligation was satisfied. The question whether an offence is of a continuing or continuous nature generally arises in the case of statutory offences and the question is solved by ascertaining what is the precise nature of the offence. A very clear case of an offence which continued in the sense first used above was that under consideration in Verney v. Mark Fletcher and Sons, Ltd., [1909] 1 K.B. 444. That was a prosecution under the Factory and Workshop Act 1901 (Eng.) for that the factory was, on 1 July 1908, not kept in conformity with the Act in that a certain fly-wheel was not securely fenced as required by s. 10 of the Act. The facts were that in May 1905 a factory inspector (the informant) visited the defendant's factory and saw the fly-wheel in question not securely fenced and required the defendant to fence it. On 12 March 1908 he again visited the factory, found the same state of things and again required the defendant to comply with the statute. On 1 July 1908 he visited the factory for a third time and found the same state of affairs continuing and on 22 July 1908 he laid his information. Without going into the merits of the case the solicitor for the defendant contended without going back to the first visit in May 1905 that the offence charged was the same offence as had been committed on 12 March 1908 and that the offence, therefore, first came to the knowledge of the informant more than three months before the information was laid and was, therefore, barred by s. 146(1) which required such an information to be laid within three months after the date at which the offence first came to the knowledge of the inspector. It was held that the offence was as much committed on 1 July as on 12 March and that as he was charged with the offence committed on 1 July that offence first came to the inspector's knowledge on that date. The view taken of the offence in that case apparently was that a fresh crime was committed on each day that the defendant failed securely to fence the fly-wheel. This is not surprising when one considers the nature of the offence and that the defendant was continually carrying on its factory operations with this dangerous machinery (cf. Knox v. Bible, [1907] V.L.R. 485; 13 A.L.R. 352). 4 R v Industrial Appeals Court; Ex parte Barelli's Bakeries Pty Ltd [1965] VR 615 at 620 to 621 -- 2 of 6 -- 3 A case more closely resembling the present one was Jones v. Lorne Saw Mills Pty. Ltd., [1923] V.L.R. 58; 29 A.L.R. 8, in which Cussen, J., had to consider an information for non-observance of an award under the Commonwealth Conciliation and Arbitration Act 1904-1920. The non-observance alleged was that the defendant employer did not pay a certain employee the amount due to him under the terms of the award for work and labour done during the period from 7 August 1920 to 27 November 1920. The information was dated 8 August 1922 and was said to be out of time by reason of s. 21 of the Commonwealth Crimes Act 1914 and also of s. 210 of the Justices Act 1915. His Honour doubted whether either of these Acts applied as he thought there was much to be said for the view that the procedure before him was rather in the nature of a penal action which might be commenced within two years after the cause of action arose. His Honour, however, considered the mater as though the statutes relied upon where applicable. After citing Avery, J.'s words in Solicitor to Board of Trade v. Ernest, [1920] 1 K.B. 816: 'The ordinary way to treat an offence as a continuing offence is to provide a penalty for each day', Cussen, J., went on: 'But, apart from such a provision as to each day, a statute may indicate by its general terms that an offence is or may be a continuing one, and by the use of the expression "non-observance", such is, I think, having regard to the objects of the Commonwealth Conciliation and Arbitration Act, as to ensuring the performance of awards, the case here. It is not necessary to say that every case of "non-observance" falling under s. 44 of the Act implies that the offence is a continuous one. A case might be conceived in which the "non-observance" would have relation to a specified or indicated day or time, and then this result would not follow. It is sufficient to say that, in my opinion, there was here just as much non-observance in 1922 as in 1920, and the information on its face is within time.' His Honour went on to consider an objection by counsel that the necessary result of giving effect to this argument would be to decide that there could be a separate conviction in respect of each day during which the failure to observe the award continued. His Honour said that this was not so. 'Up to the date of the information, at all events, there is but one offence - namely, "non-observance", an offence in which the time element is extensible so as to provide a real continuum. It must be admitted that in some of the authorities the phrases "continuous offence" and "continuing offences" are used loosely, and applied to cases where there is a repetition rather than continuance; but I need not go further into this.' This decision had the approval of Starke, J., in Ingamells v. Petroff (1934), 50 C.L.R. 451 at p. 459; [1934] A.L.R. 269. It is to be noted that his Honour indicated that not every case of non-observance of an award was necessarily a continuous offence and he instanced an offence which has relation to a specified act or indicated a day or a time for its performance.". In the same case Smith J expressed the matter more succinctly (at 623): "I have had the advantage of reading the reasons for judgement prepared by O'Bryan and Gillard, JJ. I am in agreement with their conclusions upon the points of substance that were argued, and there is, therefore, no need for me to discuss them at any great length. I consider that the Industrial Appeals Court was right in regarding the offence charged as a continuing one, and in holding that the information was, therefore, laid within time. The offence charged was not that the employer allowed the time fixed for payment to pass without having paid. It was that, moneys having become due and payable, the employer failed to perform the duty imposed by the Act of paying them to the employee. That duty is one which operates throughout the period from the time fixed for payment until actual payment. The breach of it begins at the time fixed for payment but continues on. And when an information is laid the employer is to be regarded as having committed a single offence, consisting of a failure to pay down to the date of the information or, if payment has by then been made, then of a failure to pay down to the date of such payment. The distinction is between, on the one hand, an offence which, once committed, is complete and concluded and exists only in the past, and, on the other hand, an offence constituted by a continuing breach of a duty to take action to put an end to a forbidden state of affairs, in this case that wages which have become payable under a determination are unpaid: see Jones v. Lorne Saw Mills Pty. Ltd., [1923] V.L.R. 58; 29 A.L.R. 8; J. Robins & Sons Ltd. V Maloney (No. 2), 1935 A.R. (N.S.W.) 155, at pp. 157-8, 163; Schreiber v Santora, 1935 A.R. (N.S.W.) 168; Slaggett v Adams (1953), 70 W.N. (N.S.W.) 206. A similar distinction is drawn in relation to breaches of contract in Larking v. Great Western (Nepean) Gravel Ltd. (In Liq.) (1940), 64 C.L.R. 221, at pp. 236-8.". [To the authorities cited, one should add Commissioner for Railways v Hunt (Re McDonald)5.] It follows that the Industrial Magistrate underestimated the maximum penalty and the total maximum penalty to which the Respondent was exposed. 5 Commissioner for Railways v Hunt (Re McDonald) [1939] AR 499 -- 3 of 6 -- 4 [9] It is submitted that the Industrial Magistrate further erred in failing to give reasons which adequately exposed the basis upon which the quantum of each of the fines was set. It follows from Regina Walker v Blue Recruit Pty Ltd6 that such an error would be an error of law. However, it seems to me to be tolerably clear that (fundamentally), the Industrial Magistrate imposed such modest fines because of concern about the Respondent's capacity to pay. Materially, His Honour said: "Section 48(1) of the Penalties and Sentences Act 1992 provides if a court decides to fine an offender, then, in determining the amount of the fine and the way in which it is to be paid, the court must, as far as practicable, take into account - (a) the financial circumstances of the offender; and (b) the nature of the burden that payment of the fine will be on the offender. The complainant has been unable to place before the court any information as to the financial circumstances of the offender.", and subsequently observed: "I accept employers should be discouraged from underpaying employees amounts to which they are clearly entitled. The sums underpaid are not insignificant. No information is before the court of the capacity of the defendant to pay any fine. The defendant has not been convicted of any previous offences or placed on written notice of the likelihood of a fine being imposed by the Court. The prosecution is not seeking the recording of a conviction against defendant.". [10] Whilst I accept that the Industrial Magistrate adequately exposed the core of His Honour's decision on quantum, I am unable to accept that this was a case in which s. 48 of the Penalties and Sentences Act 1992 had a role to play. Section 48 provides: "(1) If a court decides to fine an offender, then, in determining the amount of the fine and the way in which it is to be paid, the court must, as far as practicable, take into account - (a) the financial circumstances of the offender; and (b) the nature of the burden that payment of the fine will be on the offender.". There is neither a definition of the words "as far as practicable" nor statutory indication of criteria to be applied in determining "practicability". In my view, the words "as far as practicable" should be treated as words of wide import embracing at least all consideration of financial circumstances and burden which may legitimately be undertaken on the material before the Court; compare Potter v Neave7. Here, however, there was no material before the Court. Section 48(2) contemplates that such cases may arise and declares how such cases are to be dealt with. Section 48(2) provides: "(2) The court may fine the offender even though it has been unable to find out about the matters mentioned in subsection (1)(a) and (b).". [11] For completeness, I should add that, whilst proof of a defendant's financial circumstances need not be formally proved, on Appeal to this Court in contested matters defendants at first instance not infrequently deliver affidavits about financial circumstances prior to the hearing and tender the affidavits at the hearing. Industrial Magistrates are entitled to comparable assistance. I add also, though the matter was not argued, that I doubt that an Industrial Inspector's coercive powers at ss. 355 and 356 of the Act extend to documents and information relevant to s. 48 of the Penalties and Sentences Act 1992. [12] I set aside the quantum of the fines fixed by the Industrial Magistrate. [13] This matter has already been remitted on one occasion. At no time has the Respondent appeared. The Industrial Magistrate has clearly formed a view about the appropriate fines. Arguably, His Honour has mitigated because of the criticisms of the initiating process which led to the first appeal. If the matter is remitted, another Industrial Magistrate would have to rehear the matter. Counsel for the Respondent submits that this is an appropriate occasion to exercise the power at s. 341(3)(b) of the Act and substitute another decision. I agree. [14] At first instance, the Appellant submitted that the appropriate course was to impose a global fine within the range of $22,000 to $26,400 in respect of all offences. The Industrial Magistrate adopted another course. The Industrial Magistrate imposed one fine upon the complaint alleging that the Respondent had committed two offences against s. 666 of the Act in failing to pay wages and moneys in respect of pro rata annual leave to Mr Stevens. A further fine was imposed on the complaint alleging that the Respondent had not paid superannuation 6 Regina Walker v Blue Recruit Pty Ltd (C/2009/27) - Decision <http://www.qirc.qld.gov.au> 7 Potter v Neave [1944] SASR 19 at 21 per Mayo J -- 4 of 6 -- 5 contributions for the benefit of Mr Stevens. In the same way, the Industrial Magistrate imposed one fine in respect of the failure to pay wages and the failure to pay moneys in respect of pro rata annual leave to Ms Collier. The Industrial Magistrate imposed a further fine on the complaint alleging that the Respondent had not paid superannuation contributions for the benefit of Ms Collier. The Industrial Magistrate was plainly entitled to adopt that course. Indeed, no submission to the contrary is now made. I propose to follow the template set by the Industrial Magistrate. [15] The Appellant supplied the Industrial Magistrate with written submissions containing an outline of the facts relevant to all of the complaints. The outline is relatively neutral and I reproduce that outline below: "… 3. Mr Caton was the owner of the Ox Café at Jindalee and the employment of both workers was covered by the Hospitality Industry, Restaurant, Catering and Allied Establishments Award - South Eastern Division 2002. 4. In August 2007 Mr Caton offered Mr Stevens, who was a qualified chef, employment. Mr Stevens was to assist Mr Caton set up the business, which opened on 1 October, 2007. 5. According to Mr Stevens when he accepted the position he agreed with Mr Caton to be paid a set weekly wage for 45 hours and a percentage of the profits. 6. However, for the first two weeks that the café was operating, Mr Stevens was required to work 14 hours per day and from thereafter until he ceased employment, from 8.30 to 9 pm. The café operated seven days a week between 9 am and 9 pm. 7. During the course of his employment various amounts of money were directly deposited to his bank account. Mr Stevens did not receive pay slips to advise the basis of his payments. However, it readily became apparent that he was not receiving the amounts which he had been advised by the defendant and he approached Mr Caton about his concerns. Mr Stevens was advised that he would be paid when Mr Caton received money from a third party. 8. A similar situation occurred with Ms Collier. Ms Collier commenced her employment as a first year apprentice chef with the defendant on 15 October, 2007. In her statement Ms Collier stated that she consistently worked in excess of the 38 hours referred to in the award but was paid a flat rate of pay. She stated that she was required to work broken shifts, evening and morning shifts, sometimes working up to 45 hours a week. 9. After working for some little period of time Ms Collier approached Mr Caton about her pay and was assured that he would look into it. 10. She continually asked Mr Caton for payslips and was eventually provided with some. She noted discrepancies and obtained a bank statement which showed that she had not been paid for many weeks. 11. While still employed at the Ox Café, Ms Collier raised this with Mr Caton and he said that he would pay her what she was owed. After she cased [sic. ceased] employment Ms Collier was told that she would receive a cheque from Mr Caton's accountant.". The submissions revealed also that whilst Mr Caton participated in an interview with an inspector, he chose not to avail himself of the opportunity to avoid prosecution by paying the outstanding amounts of money. [16] The allegations are serious. The allegations are of a knowing failure to pay. It is a matter of particular concern that one group of offences concerned a first year apprentice. There has not been a timely plea of guilty nor, save for participation in an interview which might have been made compulsory, has there been cooperation with the investigating authorities. There is however, the significant mitigating factor that the Respondent has no previous convictions. Had the Respondent appeared I should have been reluctant to go outside the range nominated by the Appellant at first instance. I shall do the Respondent the courtesy of treating him in the same way. On balance, I shall impose a fine of $8,000 in respect of each of the failures to pay wages and moneys by way of pro rata annual leave to each of Mr Stevens and Ms Collier, and a fine of $3,000 in respect of the failures to make superannuation contributions for the benefit of each of Mr Stevens and Ms Collier. Since, as explained at paragraph [5], I propose also to correct the remedial orders made by the Industrial Magistrate, I formally set aside the remedial orders made by the Industrial Magistrate. -- 5 of 6 -- 6 [17] I order that: (1) On the complaint relating to the failure to pay wages and pro rata annual leave to Zen Siripala Stevens, the Respondent be fined the sum of $8,000 and that the Respondent pay $71.70 costs of court and that the Respondent: (a) Pay to the Registrar of the Court the amount of $6,048 for and on behalf of Zen Siripala Stevens. (b) That the amount be paid within three months of the date of release of this Decision. (c) That in default of payment there be levy and distress. (2) On the complaint relating to failure to pay wages and pro rata annual leave to Marina Annie Collier, the Respondent be fined $8,000 and that the Respondent pay $71.70 costs of court and that the Respondent: (a) Pay to the Registrar of the Court the amount of $1,952.54 for and on behalf of Marina Annie Collier. (b) That the amount be paid within three months of the date of release of this Decision. (c) That in default of payment there be levy and distress. (3) On the complaint relating to failure to make superannuation contributions on behalf of Zen Siripala Stevens, the Respondent be fined $3,000 and that the Respondent pay $71.70 costs of court and that the Respondent: (a) Pay to the Registrar of the Court for remission to the Integra Superannuation fund (Account number 74938332645) for and on behalf of Zen Siripala Stevens the amount of $1038.32. (b) That the amount be paid within three months of the date of release of this Decision. (c) That in default of payment there be levy and distress. (4) On the complaint relating to failure to make superannuation contributions on behalf of Marina Annie Collier, the Respondent be fined $3,000 and that the Respondent pay $71.70 costs of court and that the Respondent: (a) Pay to the Registrar of the Court for remission to the Hostplus Superannuation fund (Account number 102094325) for and on behalf of Marina Annie Collier the amount of $178.18. (b) That the amount be paid within three months of the date of release of this Decision. (c) That in default of payment there be levy and distress. Dated 26 March 2010. D.R. HALL, President. Released: 26 March 2010 Appearances: Ms J. Cameron, Legal and Prosecution Services Unit for the Appellant. No appearance for the Respondent. -- 6 of 6 --