Australian Competition and Consumer Commission v Employsure Pty Ltd (No 2)

• Jurisdiction: Australia Federal only
• Court: Federal Court (Australia)
• Judgment Date: 27 August 2021
• Neutral Citation: [2021] FCAFC 157
• Date: 27 August 2021

Federal Court of Australia

Australian Competition and Consumer Commission v Employsure Pty Ltd (No 2) [2021] FCAFC 157

Appeal from:	Australian Competition and Consumer Commission v Employsure Pty Ltd [2020] FCA 1409
File number:	NSD 1183 of 2020
Judgment of:	RARES, MURPHY AND ABRAHAM JJ
Date of judgment:	27 August 2021
Catchwords:	CONSUMER LAW – misleading or deceptive conduct and making false or misleading representations – whether appellate court should make declarations of contravention and grant injunctive relief – issue of injunctive relief remitted to primary judge
Legislation:	Competition and Consumer Act 2010 (Cth) Sch 2 (Australian Consumer Law) ss 18(1), 29(1)(b), 29(1)(h), 232
Cases cited:	Australian Competition and Consumer Commission v Dataline.net.au Pty Ltd [2007] FCAFC 146; 161 FCR 513 Australian Competition and Consumer Commission v Employsure Pty Ltd [2021] FCAFC 142 Australian Competition and Consumer Commission v Valve Corporation (No 4) [2016] FCA 382 Commonwealth of Australia v Director, Fair Work Building Industry Inspectorate & Ors [2015] HCA 46; 258 CLR 482
Division:	General Division
Registry:	New South Wales
National Practice Area:	Commercial and Corporations
Sub-area:	Regulator and Consumer Protection
Number of paragraphs:	14
Date of last submission/s:	20 August 2021
Date of hearing:	Heard on the papers
Counsel for the Applicant:	Mr N Owens SC and Ms D Forrester
Solicitor for the Applicant:	Corrs Chambers Westgarth
Counsel for the Respondent:	Mr P Brereton SC and Mr C Bannan
Solicitor for the Respondent:	Webb Henderson

ORDERS

		NSD 1183 of 2020
BETWEEN:	AUSTRALIAN COMPETITION AND CONSUMER COMMISSION Applicant
AND:	EMPLOYSURE PTY LTD ACN 145 676 026 Respondent

order made by:	RARES, MURPHY AND ABRAHAM JJ
DATE OF ORDER:	27 AUGUST 2021

THE COURT ORDERS THAT:

1. It be declared that between 10 August 2016 and 31 August 2018, Employsure Pty Ltd (Employsure) has, in trade or commerce, in connection with the supply or possible supply of advisory services, by its use of the Google Ads service and through the six Google Ads identified in the schedules to the reasons for judgment of the Full Court dated 13 August 2021 which appeared on the screens of the computers, laptops or smartphones of business owners in response to their Google searches for “fair work ombudsman”, “fair work commission”, “fair work australia” and other related search terms, represented to business owners that Employsure is, is affiliated with, or is endorsed by a government agency when, in fact, Employsure is a private company that has no affiliation with, and is not endorsed by, any government agency; and Employsure thereby:

   1. engaged in conduct which was misleading or deceptive, or likely to mislead or deceive, in contravention of s 18(1) of the Australian Consumer Law (ACL) in Schedule 2 to the Competition and Consumer Act 2010 (Cth); and

   2. made a false or misleading representation that:

1. its services are of a particular standard or quality in contravention of s 29(1)(b) of the ACL; and

2. it has government sponsorship or approval in contravention of s 29(1)(h) of the ACL.

2. The proceeding be remitted to the primary judge for hearing as to the injunctive relief sought.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

THE COURT:

1. On 13 August 2021 the Full Court allowed the appeal herein by the Australian Competition and Consumer Commission (ACCC): Australian Competition and Consumer Commission v Employsure Pty Ltd [2021] FCAFC 142. The Court held that during the period from 10 August 2016 to 31 August 2018 (the relevant period) the respondent, Employsure Pty Ltd (Employsure), by its use of the Google Ads service and through the six Google Ads identified in the schedules to the reasons for judgment of the Full Court, which advertisements appeared on the screens of the computers, laptops or smartphones of business owners in response to their Google searches for “fair work ombudsman”, “fair work commission”, “fair work australia” and other related search terms, represented to business owners that Employsure is, is affiliated with, or is endorsed by a government agency when, in fact, Employsure is a private company that has no affiliation with, and is not endorsed by, any government agency. It held that Employsure thereby:

1. engaged in conduct which was misleading or deceptive, or likely to mislead or deceive, in contravention of s 18(1) of the Australian Consumer Law (ACL) in Schedule 2 to the Competition and Consumer Act 2010 (Cth); and

2. made a false or misleading representation that:

   1. its services are of a particular standard or quality in contravention of s 29(1)(b) of the ACL; and

   2. the Respondent has government sponsorship or approval in contravention of s 29(1)(h) of the ACL.

2. The Court set aside the orders of the primary judge and directed the ACCC and Employsure to confer in an endeavour to agree the form of any declaration and injunction that should be made in relation to the subject matter of the appeal, failing which the parties were required to provide short submissions to the Court on or before 20 August 2021. The matter was then to be remitted to the primary judge for decision in relation to the application for pecuniary penalties for the contraventions of ss 29(1)(b) and (h), and the costs of the proceeding below.

3. The parties have conferred and have been unable to agree as to whether a declaration or injunction should be made, nor as to their form in the event that they are to be made. As directed, they have filed short submissions. For the reasons we briefly explain, we consider it appropriate to make a declaration and to remit to the primary judge the question as to whether an injunction should be granted, and if so in what form.

Declaratory relief

4. The ACCC sought declaratory relief in its Amended Originating Application, including by identifying the terms of the proposed declaration, and it maintained its application for such relief in the Notice of Appeal. The appeal having been decided in its favour, the ACCC now seeks an order for a declaration in those terms.

5. Employsure contends that the Full Court should not make a declaration, and that the question of whether to grant such relief and its terms should be remitted to the primary judge for hearing, along with the question of whether to impose a pecuniary penalty which was remitted in the substantive judgment in the appeal. It says, and we accept, that pursuant to an order of the primary judge made on 11 February 2019, the question of liability was tried separately and in advance of the determination of any relief to be granted. On that basis Employsure says that it has not yet had the opportunity to lead evidence on matters concerning relief, and there has been no hearing as to relief.

6. Employsure accepted that it is inevitable that a declaration will be made having regard to the decision of the Full Court, but it contends that in light of the order splitting the trial of liability and relief, the appropriate course is for all questions of relief to...