Furthermore, no doubt, as Mr Kontaxis submitted, the amount of costs and
disbursements incurred by ACMA with respect to the proceeding would likely have
increased significantly beyond that sum by the conclusion of the trial.
91. Mr Kontaxis was unable to identify any authority directly in support of his submission as
to the relevance of legal costs to the assessment of civil penalties. However, he relied
upon the decision of the New South Wales Court of Criminal Appeal in Environmental
Protection Authority v Barnes [2006] NSWCCA 246 (Barnes (CCA)) involving an
appeal against sentence by the relevant prosecutorial authority, the Environment
Protection Authority. The primary judge in that case had held in the exercise of
discretion under s 253 of the Criminal Procedure Act 1986 (NSW) (as it then stood) that
it was appropriate to make an order for costs in the prosecutor’s favour and to take the
amount of those costs into account in assessing penalty “because if substantial they will
clearly impact on the ability of the Defendant to pay a fine” (quoting Environment
Protection Authority v Barnes [2006] NSWLEC 2 at [77] (Pain J)). Justice Pain then
held that “[h]ad the costs not been so great I would have imposed a much higher
penalty” (as quoted in Barnes (CCA) at [77]). In this regard, I note that her Honour had
also found at the trial, among other mitigating factors, that Mr Barnes was a person of
limited means (see Barnes (CCA) at [76]).
92. The question on appeal in Barnes (CCA) was relevantly whether the criminal penalties
imposed on Mr Barnes were manifestly inadequate. Kirby J (with whose reasons Mason
P and Hoeben J agreed at [1] and [92] respectively) held that they were not, finding that:
78. The assertion by the appellant that the penalty imposed was “a minuscule
proportion of the maximum penalty” is not entirely accurate. The individual fines
(which totalled $4,500) had, in each case, been discounted by 25% to take account
of the pleas of guilty. But, more than that, the costs of $15,727.13 were an
important aspect of the punishment of Mr Barnes. Quite apart from his own costs,
he was required, by reason of his breaches of the law, to pay slightly in excess of
$20,000.
...
88. ... As a matter of first impression, the fines imposed appeared
unduly lenient, suggesting error. However, the fines were part
only of the penalty. Mr Barnes was obliged to pay substantial
costs. Her Honour made it clear that, but for that fact, the fines
she would have imposed would have been much higher.
93. It does not necessarily follow, however, that, because liability to pay the prosecution’s
costs may be taken into account in assessing criminal penalties, liability to pay the legal
costs of the regulator enforcing a civil penalty provision is relevant to the assessment of
the civil penalties. Thus, in Pattinson at [14], Keifel CJ, Gageler, Keane, Gordon, Steward
and Gleeson JJ held that “basic differences’ between criminal prosecutions and civil
penalty proceedings mean there are limits to the transplantation of principles from the
former context to the latter”.
94. It has already been seen that it is no part of the purpose of civil penalties to punish. As
such costs cannot be regarded as part of any “punishment” for contravening a civil
penalty provision, in contrast to the approach adopted in Barnes (CCA) in the criminal
context. Furthermore, as ACMA submitted, costs and civil penalties serve different
purposes (ACS at [11]). While the purpose of imposing a civil penalty is focused upon
deterrence, the purpose of an award of costs is compensatory in the sense of
indemnifying the successful party for the expense incurred by the successful party by
reason of the legal proceedings: see Latoudis v Casey [1990] HCA 59; (1990) 170 CLR
534 at 543 (Mason CJ) and 567 (McHugh J); Ruddock v Vadarlis (No 2) [2001] FCA
1865; (2001) 115 FCR 229 (Ruddock (No. 2)) at [11]-[12] (Black CJ and French J). It is
also true that, if (as he has foreshadowed) in due course Mr Kontaxis may take issue with
the reasonableness of ACMA’s costs, the proper remedy is for an assessment of the
reasonableness of ACMA’s costs to be made on a taxation.
95. The highest it might be put, in my view, in the civil penalty context is that a liability to
pay the costs of the regulator might be able to be taken into account in ensuring that the
penalties to be imposed are not oppressive and thereby exceed the level required to
achieve the objects of specific and general deterrence. On the other hand, there may be
strong policy reasons as to why that approach might not be taken or which call for a high