The Federal Court has given a landmark decision about regulatory prosecutions. In federal jurisdictions and state jurisdictions which follow the new decision, professional disciplinarians like ASIC and Legal Services Commissioners will no longer be able to enter into plea bargains in the expectation that the court or tribunal hearing them will rubber stamp the agreed outcomes so long as they are ‘within the permissible range’ of penalties. But nor will disciplinary prosecutors be able to submit what the appropriate penalty ought to be. Rather, they will be limited to making submissions about the appropriate sentencing principles, and about similar outcomes in similar cases.
The powerful judgment is at odds with a paragraph of dicta in a recent decision of the Victorian Court of Appeal in that it applies the High Court’s decision in Barbaro, a criminal case, to the quasi-criminal realm. How the case plays out in Victoria remains to be worked out, but if this case goes to the High Court (and both sides have filed special leave applications), all that may change. Certainly the settlement of proceedings by regulators just got more complicated.
There seems to be a discrepancy about fundamental norms of government between the dicta of our Court of Appeal and the ratio of the Federal Court’s decision. Once that gets resolved, however, each piece of legislation setting up the regulatory regime must be construed against the backdrop of those fundamental norms, and might give rise to different outcomes. The Federal Court approached the task of working out how Barbaro applies in regulatory prosecutions in an orthodox fashion, i.e. by a process of statutory construction based on a close textual analysis of the legislative scheme as a whole.
The Chief Justice of the Federal Court allocated three judges to hear a preliminary question in the regulatory prosecution at first instance, in which the parties had already agreed on a proposed outcome, the result of a settlement (or, if you will, a plea bargain). The proceeding was brought against the CFMEU and the judgment’s aim was apparently to sort out once and for all if, and how, the High Court’s decision in Barbaro is to apply in proceedings for a penalty. The mouthful of a case is reported as Director, Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union  FCAFC 59, but seems set to be called ‘the CFMEU Case’.
It’s quite a judgment: indignant, keen to cut cant, and argued from first principles in relation to the place of the courts in civil society. It is a further step in the demolition of the nonsense about disciplinary proceedings being sui generis, fundamentally distinct from criminal prosecutions, and (oh, spare me!) protective and not punitive in a way which means the protection of those against whom punishment is sought need not be extended. The punishment of citizens is, and must be seen to be, a job for the courts (except where parliament has expressly provided otherwise); where the State is seeking to punish citizens the label applied to the proceedings is a distraction; and in such cases, the Courts having been tasked with ascertaining the appropriate penalty, they must do so conscientiously themselves, however convenient it might be for them, for regulators, and for the regulated, to cede that task to a regulator which is part of the machinery of the executive arm of government, and to pay lip service to the inquiry conducted by the Court into the appropriateness of a deal done behind closed doors. So said the Court.
The indignation extends to the many judges and other decision makers who have convinced themselves post-Barbaro that the decision does not apply to them, often on the basis that criminal proceedings are special and proceedings for a penalty are civil proceedings and nothing like criminal prosecutions. Distinguishing Barbaro away has been de jour. Continue reading “Submissions on penalty in regulatory proceedings like ASIC and disciplinary prosecutions”