Woolworths Limited v Stacey Maree Spletter

DISTRICT COURT OF QUEENSLAND

CITATION:	Woolworths Limited v Stacey Maree Spletter [2018] QDC 13
PARTIES:	WOOLWORTHS LIMITED (appellant) v STACEY MAREE SPLETTER (respondent)
FILE NO:	2410 of 2017
DIVISION:	Criminal
PROCEEDING:	Appeal
DELIVERED ON:	20 February 2018
DELIVERED AT:	Brisbane
HEARING DATE:	1 December 2017
JUDGE:	Rosengren DCJ
ORDER:	1.   Appeal is dismissed. 2.   Application for leave to adduce new evidence is refused. 3.   Appellant to pay $1,800 costs to be paid to the Registrar of the District Court at Brisbane within 21 days in order that such sum be paid over to the respondent. 4.   If an alternate order as to costs is sought, the parties are to provide written submissions by 4pm on 27 February 2018.
CATCHWORDS:	CRIMINAL LAW – s 222 APPEAL – APPEAL AGAINST SENTENCE – where the appellant was convicted of a number of offences under the Food Act 2006 (Qld) – where the appellant had prior similar convictions – whether penalty is excessive having regard to mitigating factors and penalties imposed for similar offences APPLICATION TO ADDUCE FURTHER EVIDENCE – where the appellant made an application to adduce new evidence at the hearing of the appeal – whether special grounds exist to allow the application Food Act 2006 (Qld) s 39(4) Justices Act 1886 (Qld) s 223 Penalties and Sentences Act 1992 (Qld) ss 9(2), 44 and 49 Forrest v Commissioner of Police [2017] QCA 132, cited McDonald v Queensland Police Service [2017] QCA 255, applied
COUNSEL:	S Grant for the appellant S J Farnden for the respondent
SOLICITORS:	Gould & Associates for the appellant Crown Law for the respondent

1. On 14 June 2017, in the Magistrates Court at Roma, Woolworths Ltd pleaded guilty to 16 offences against s 39(4) of the Food Act 2006 (‘the Food Act’). The charges relate to Woolworths displaying for sale at its store in Roma, 27 food items past their use-by date. Woolworths Ltd was fined $40,000 and a conviction was recorded.

2. This is an appeal by Woolworths Ltd against penalty, on the basis that the fine imposed was excessive and disproportionate to any other fine previously imposed on it or its competitors.  Woolworths Ltd also seeks to adduce new evidence.

3. For the reasons set out below, the appeal should be dismissed.  Further, the application to adduce new evidence should be refused. 

Circumstances of the offending

4. Woolworths Ltd trades in Roma, Queensland, as Woolworths Roma (‘the Roma store’) and operates a grocery store selling packaged, fresh and frozen food to the public.

5. On 5 August 2016, as part of a state-wide Use-by-Date Project, Environmental Health Officer (EHO), Stacey Spletter in the company of EHO, Paul Morgan attended the Roma store.  The officers found and seized 27 items from the shelves that were between 1 and 45 days past their use-by date. The offending food items were blue cheese dip (45 days); leg ham (14 days); Hans Kookwurst (20 days); pâté (10 days); pasta salad (5 days) and milk (2 days).  The seized items were on display in areas where members of the public could select them for purchase.  Prices were affixed to the displays in front of the items, indicating that they were for sale.  All items apart from one, were in the delicatessen section of the store.

6. Woolworths Ltd had a National Food Safety Scheme.  It had been implemented in the Roma store.  It included what is described as an ‘out of code report’, which had been designed to help ensure that food was not sold past its use-by date. The scheme was audited daily by the senior employee of each of the relevant departments.

7. The process for identifying use-by food began when an item arrived in the store.  Its allocated barcode would be scanned.  At the same time, the use-by date of the item would be manually entered into the scanning gun by the employee who had scanned the barcode. This scanned information would be transferred to the store's computer.  The item would then be placed onto the shelf in its designated area.  The process also provided for the manager of each department to be provided with an automatically generated report detailing those items with a use-by date in the following two weeks.  This then required a member of each department to physically inspect each item, four days prior to the use-by date.  Daily physical inspections of these items would then occur until the date of expiry of the use-by date.  If the item was still on the shelf on that date, it was to be removed from the shelf and disposed of in a rubbish bin. 

8. In addition, 'spot checks' and random 'swarms' were meant to be completed throughout the week in each department across the Roma store.  The store manager explained to the investigators that a bay of the store, for example, all of the juice section or all of the yoghurt section, would be checked by all store staff ‘swarming’ the area. 

9. The Roma store manager was interviewed on the day of the inspection.  He indicated that he was aware that it was an offence to sell food subsequent to its use-by date and that Woolworths Ltd’s policy was that such food was not to be sold.  He provided the investigators with a copy of a document created by Woolworths Ltd, titled “Date code checks closed”.  He showed the investigators a copy of the report which had been generated for that day.  He also showed the investigators a copy of the report for that day which listed the items included on that report that were required to be checked on account of their use-by date. 

10. On 22 November 2016, the appellant’s operations manager and the risk and safety manager were interviewed.  The investigators were informed that the manager of the delicatessen at the Roma store was being performance managed at the time of the inspection and that this process had commenced a week or two earlier.  The investigators were also told that an internal investigation had found that Woolworths Ltd’s policies were sound and that the offences were explicable by human error.

Previous history of similar offending

11. Although this was the first occasion the Roma store has been prosecuted for and convicted of selling food past the use-by date, there have been three previous occasions where supermarket stores owned and operated by Woolworths Ltd have been convicted of such offences. 

12. On 11 March 2008, Woolworths Ltd was convicted of selling 57 items of pâté past their use by date at its Emerald store. Tests were carried out on all the food items which revealed they remained fit for human consumption.  It was fined $5,000, plus costs.  The value of a penalty unit at the time was $75. 

13. In 2010, two separate prosecutions were commenced against Woolworths Ltd in relation to its stores at Toowoomba and Blackwater. The prosecution in relation to the Toowoomba store proceeded by way of a guilty plea and sentence on 30 June 2010.  Woolworths Ltd was convicted of two counts of selling food past its use by date in relation to 18 items which were between 1 and 34 days past their use by date. There had been two separate inspections.  Woolworths Ltd was fined $25,000.

14. The prosecution in relation to the Blackwater store proceeded to trial on 7 December 2011. Woolworths Ltd argued that their food safety system amounted to due diligence. It was nevertheless convicted of selling 10 packets of pâté past their use by date.  The fine was $20,000. This was appealed and on 14 March 2012, Noud DCJ reduced the fine to $7,500 having assessed the totality of the situation, including the fine which had recently been imposed on Woolworths Ltd for its offending at the Toowoomba store.  The value of a penalty unit in 2010 and 2011 was $100.

Nature of s 222 appeals

15. The appeal is by way of rehearing of the evidence.  At the hearing, it was submitted by both counsel that an error by the Magistrate does not necessarily need to be shown for Woolworths Ltd to succeed.  This was in reliance on a passage from the reasons of Sofronoff P, in the decision of Forrest v Commissioner of Police[1], which was delivered on 15 June 2017.

    [1] [2017] QCA 132.

16. Forrest involved an appeal against conviction rather than sentence. The relevant appeal provision is s. 222(2)(c) of the Justice Act 1886 (‘the Justices Act’).  This provides that where a defendant pleads guilty, an appeal can only be brought on the sole ground that a fine, penalty or punishment was excessive or inadequate.  

17. This court is empowered to intervene:

“… only if the sentencing discretion miscarried, either by specific error (such as acting upon a wrong principle, mistaking the facts, taking into account irrelevant circumstances or failing to take into account relevant circumstances) or by imposing a sentence which is “unreasonable or plainly unjust” such as to demonstrate that the sentencing discretion must have miscarried even though no specific error can be identified: House v The King (1936) 55 CLR 499 at 505.”[2]

18. In other words, a mere difference of opinion about the way in which the discretion should be exercised is not a sufficient justification for review[3]. In the recent Court of Appeal decision of R v Callow[4] at [36], Morrison J reinforced what Gleeson CJ, Gummow, Hayne and Callinan JJ said in Markarian v The Queen[5]:

“Furthermore, there is no one single correct sentence. Judges at first instance are to be allowed as much flexibility in sentencing as is consonant with consistency of approach and as accords with the relevant statutory regime.”

19. In referring to Markarian, Boddice J said in R v Frith[6] at [35]:

“In any event, that the sentence imposed on the applicant was higher than imposed in another factual circumstance does not establish manifest excessiveness.  A particular fact situation does not support a single correct decision.  The sentencing discretion involves an allowance of flexibility in the exercise of that discretion.”

20. Section 223 of the Justices Act 1886 permits the Court to give leave to adduce new evidence on this appeal if the Court is satisfied that there are special grounds for giving such leave.

21. The relevant principles and test were discussed in R v WBF[7] where Philippides J said at [106] – [107]:

“The relevant principles concerning further evidence are as set out in R v Spina.  Fresh evidence is evidence which either did not exist at the time of the trial or which could not then with reasonable diligence have been discovered.  On the other hand, new or further evidence is evidence on which a party seeks to rely in an appeal which was available at trial or could with reasonable diligence have then been discovered.

The test for determining whether to allow an appeal against conviction based on fresh evidence is whether it is established that there is a significant possibility (or that it is likely) that, in light of all the admissible evidence, both the fresh evidence and the evidence at trial, a jury acting reasonably would have acquitted.” [citations omitted]

22. In the context of a sentence appeal to the Court of Appeal, this was expressed in R v Maniadis[8] from page 596 in the joint judgement of Davies JA and Helman J, with whom the President agreed:

    [8] [1997] 1 Qd R 593.

" ... The power to admit evidence not adduced below appears to be at least as wide in an appeal against sentence as in an appeal against conviction…

. . . That is not to say that the discretion to admit new evidence in an appeal pursuant to subs. (3) will be commonly exercised by an appellate court.

But a court of appeal will admit new evidence on such an appeal, notwithstanding that it is not fresh in the above sense, if its admission shows that some other sentence, whether more or less severe, is warranted in law; in this case, that the sentence in fact imposed was unwarranted in the sense that it was manifestly excessive. Evidence of events occurring after the date of sentence is generally unlikely to show this unless it shows what the state of affairs was at the time the sentence was imposed.

There will no doubt be cases in which, notwithstanding that, if such evidence were admitted some other sentence would be warranted, the evidence should nevertheless be excluded. Where the evidence was known to the appellant at the sentence hearing and deliberately withheld, that will generally be so." [citations omitted]

The Food Act 2006 (Qld)

23. The Food Act 2006 (‘the Food Act’) creates the regulatory framework which is relevant to this appeal. The purposes of the Food Act are set out in section 9. These are ensuring food for sale is safe for human consumption, preventing misleading conduct relating to the sale of food and applying the food standards code[9]. 

    [9] Australia and New Zealand Food Standards Code.

24. Section 39(4) of the Food Act provides that a person must not sell or advertise for sale food in a way that contravenes a provision of the food standards code. The food standards code prohibits the sale of food after its ‘use-by’ date[10].

    [10] Standard 1.2.5-5.

25. The maximum penalty is 500 penalty units.  At the time of sentence, a penalty unit was $121.90[11].  For a body corporate, the maximum penalty is up to five times the maximum for a natural person[12].  Therefore the maximum penalty for a single breach for a corporation is $304,750.  This shows how seriously the community through Parliament regards such breaches.  Here there were 16 such breaches, with the consequence that the maximum penalty that could have been imposed on Woolworths Ltd is $4,876,000.    The penalty that was imposed by the learned Magistrate was $40,000.

    [11] It was increased to $126.15 on 1 July 2017.

    [12] S 181B(3) of the Penalties and Sentences Act 1992.

Sentencing framework

26. Since the relevant offences were all State offences, the Penalties and Sentences Act 1992 (‘the PSA’) applies. Part 2 of the PSA sets out the governing principles for sentencing offenders who commit State offences. Amongst those provisions, s 9(2) particularises the sentencing guidelines to which the court must have regard to when passing sentence.

27. Relevantly here, s 44 of the PSA empowers the court to impose a fine. Further, s 48, provides that in determining the amount of the fine, the court must as far as practicable, take into account the financial circumstances of the offender and the nature of the burden that payment of the fine will be on the offender. Further, pursuant to s 49, the court may impose a single fine where an offender is guilty of two or more offences that are founded on the same facts or if those offences form, or are part of, a series of offences of the same or a similar kind.

Sentencing remarks

28. The sentencing remarks reveal that the learned Magistrate took into account the following matters:

(i)      the early plea of guilty and substantial cooperation between Woolworths Ltd and the investigating authorities, which his Honour considered showed real and genuine remorse;

(ii)     the fact that Woolworths Ltd is a good corporate citizen;

(iii)    the need for substantial personal and general deterrence;

(iv)    the fact that the offending was confined to one specific person who was being performance managed, in circumstances where the depth and breadth of the problem was not fully understood until the subject investigation;

(v)     the need for an organisation such as Woolworths Ltd to have strategies and processes in place to ensure that difficulties such as those laid bare by the investigators were detected early and addressed promptly with follow-up action; and

(vi)    the maximum penalty for the offence. 

Exercise of discretion

29. The appellant argues that its culpability was largely a function of human error on the part of the delicatessen manager and that the Magistrate failed to take account, or missed the point. 

30. However, a consideration of the sentencing remarks supports a conclusion that the learned Magistrate gave due and proper consideration to this feature of the offending.  His Honour made the following remarks in respect of this matter:

“It is said by the defence that the offending in respect of the 16 charges is confined to one specific person. That person was, at the time of the inspection by the EHO officers, being performance managed.  And … whilst some matters had been brought to the attention of Woolworths, it is this court’s understanding that the depth and breadth of the problem was not fully understood until the investigation had been undertaken by the investigators.  Nevertheless it is the responsibility of an organisation such as the defendant to have in place strategies and processes … to ensure that difficulties such as those experienced or laid bare by the investigation are detected early and addressed properly and swiftly and promptly, and follow up action is taken.”[13]

31. The Magistrate’s finding that responsibility for the breaches did not solely rest with the delicatessen manager was clearly open on the evidence before the court, particularly where some of the food items were 45 days past their use by date.   To suggest otherwise is overly simplistic.   There are a few reasons for this.    First, the delicatessen manager would not have been working every day the physical checks were being undertaken over the relevant period.  Second, the systems in place were such that physical checks and dumps were required to be carried out by staff, in addition to the delicatessen manager.  Third, ‘spot checks’ and random 'swarms' were meant to be completed throughout the week in each department across the Roma store.  This involved all store staff ‘swarming’ the delicatessen area and all other areas within a given week.  

32. The appellant also contends that it is difficult to discern what, if any real benefit was given to it for the plea of guilty, particularly where the fine imposed accorded with that which was submitted to be appropriate by the respondent. 

33. As an essential part of the transparency of the sentencing process, the learned Magistrate was required to state the guilty plea was taken into account and how it had been done.[14]  However, how the plea is taken into account does not need to be the subject of express mathematical explanation.   It is to be observed that while the appellant’s plea was a matter to be taken into account in its favour, the case against it was a strong one given the nature of the investigation which identified the breaches.  

    [14] R v Woods [2004] QCA 204 at [10].

34. The learned Magistrate expressly stated the plea of guilty was taken into account and that the penalty imposed by the court is less than it would otherwise have been but for the timely plea of guilty. 

35. The fact that the Magistrate imposed the fine suggested by the respondent does not lend support to the appellant’s submission that the discount for the plea of guilty was illusory.  His Honour said:

“What is being asked by the Prosecution here today, having regard to the maximum penalty … is certainly moderate and appropriate in all the circumstances. The maximum penalty that could be imposed by the Court having regard to the maximum penalty provided for by not only the Food Act itself, but by the multiplication provision of section 181B of the Penalties and Sentences Act, is far higher than that suggested by the Prosecution here today. It is the case that the breaches before the Court are serious. … the periods of time for which they were out of date range from one day up to a maximum of 45 days. That is a concern to the Court and, no doubt, to the community and enforcement authorities as well.

Balanced against this … the defendant has entered an early plea of guilty, was cooperative with authorities, and by their timely plea of guilty and cooperation with authorities, has, in the Court’s view, shown real and genuine remorse … .  In all the circumstances, I am of the view that the range proposed by the Prosecution is appropriate.”[15]

36. In short no error has been demonstrated in the learned Magistrate’s approach to the appellant’s plea of guilty.

37. It was further submitted by counsel for Woolworths Ltd that the Magistrate did not engage in a proper exercise of sentencing discretion when considering the fines imposed in relation to the earlier breaches, when compared with the fine which is the subject of this appeal.  More particularly, the appellant complained that the learned Magistrate had taken a quantum leap and imposed a fine which is out of all proportion when one compares the fines imposed in relation to the previous breaches by the appellant.   I am not persuaded his Honour made any such error. 

38. A sentencing judge is not permitted to increase a sentence beyond that which is proportionate, where an offender has prior convictions[16].  Having said this, Woolworth Ltd’s prior convictions were relevant to the exercise of the sentencing discretion. They were of substantially similar character to the subject offences.   They show that the Roma store breaches are not an uncharacteristic aberration on the part of the appellant.    It was legitimate for the learned Magistrate to take account of the history, as it showed a need to impose a penalty of such a nature to deter Woolworths Ltd and other corporate offenders from committing further offences of a like kind.  

    [16] Veen v The Queen (No 2) (1988) 164 CLR 465 at [477].

39. When regard is had to the appellant’s past convictions for the same offence, albeit at different stores, there was a sound basis for the learned Magistrate’s observation of the need for personal and general deterrence and community denunciation in any sentence imposed on the applicant. 

40. Woolworths Ltd also complains that the Magistrate did not give sufficient weight to the fact that it has a long history of being a good corporate citizen.   However, his Honour made specific reference to this in some considerable detail[17].

    [17] Transcript Magistrates Court p 4 lines 1-23.

41. Turning to the comparables relied on by the appellant, consistency of sentencing is a desirable objective in the sentencing process.  For this reason, I consider some consideration and assessment of the cases that have been referred to this court is necessary.  However, care needs to be taken when considering such decisions, as each case turns upon its own facts.

42. The Magistrate was presented with a schedule of comparatives in relation to breaches of sections 29, 35, 36 and 39 of the Food Act. Woolworths Ltd relies on some of these to demonstrate that the fine imposed in this matter was excessive.

43. Two fines the appellant relies on, are the $8,000 imposed on Spano’s IGA on 25 August 2010, and that $7,000 fine imposed on IGA Yarraman on 27 May 2011.  Unlike the Woolworths Ltd business model, IGA operates as a franchise through stores that are owned separately from the brand.  There is limited information in relation to the circumstances surrounding these respective breaches. However, a significant distinguishing feature when compared to this matter, is the apparent absence of any previous history for like breaches by either store.

44. Counsel for Woolworths Ltd also relied on a fine of $30,000 that was imposed on Chin Chin Restaurant at Springwood on 1 April 2016. It related to breaches of s 35(2) of the Food Act, whereby on 3 January 2015, over a three hour period, it sold food that was unsafe to 71 people.

45. Another penalty cited by the appellant in support of its contention that the fine imposed is excessive, is the $5,000 fine imposed on Gold Coast Permaculture on 20 March 2013, once again for breaches of s 35(2) of the Food Act. In that case, 11 people suffered salmonellosis from three food items which were sold to them resulting in harm.

46. Those decisions involved breaches of a different section of the Food Act, by smaller businesses with no history of previous breaches. I would not hold that either of these two decisions can be relied on to indicate the excess of the fine imposed.

47. It follows that I am not persuaded that the learned Magistrate made any error in the exercise of his discretion when determining the quantum of the fine. Having considered each ground of appeal and having reviewed the evidence before me I am satisfied that the appeal ought to be dismissed.

Adducing new evidence

48. The appellant brought an application for leave to adduce evidence, being an affidavit of the delicatessen manager dated 23 November 2017.  The Court received the evidence that was tendered, initially at least, for the purpose of determining the application.

49. The delicatessen manager relevantly deposes to the following:

(i)      he had been in this position since 2010;

(ii)     at the time of the inspection on 5 August 2016 he had been diagnosed with a medical illness and was suffering from significant health issues associated with this illness;

(iii)    the health issues caused him to be fatigued and unable to function properly at work;

(iv)    he had been placed on a program of performance management;

(v)     he had not disclosed to his work managers or colleagues the reason for his poor performance; and

(vi)    he only disclosed his illness when asked by the solicitors for Woolworths Ltd and subsequently attended upon his doctor on 13 June 2016, at which time he was provided with a medical certificate.

50. There is no reason to question the credibility of this evidence.

51. The evidence was not fresh evidence.  It is apparent from the affidavit of the delicatessen manager that the solicitors for Woolworths Ltd were aware of the medical diagnosis prior to the sentencing hearing on 14 June 2017.  This was confirmed at the appeal hearing by counsel for Woolworths Ltd, who informed the court that this had been disclosed to the particular solicitor who was representing the appellant at the sentence hearing.  In fact this solicitor informed the Magistrate that he did not have instructions to raise the personal problems of the delicatessen manger in open court.  If there were some understandable sensitivities around disclosing these matters in open court, the solicitor could have simply applied for the court to be closed.  This did not occur.  

52. In all the circumstances, I am satisfied that the evidence sought to be relied upon on the appeal is new rather than fresh evidence, in that it was available at the time of the sentence hearing.  However, this is not necessarily fatal if the evidence is sufficiently strong to justify interference with the penalty imposed.  I do not consider the evidence to be of such probative value. This is because extensive submissions were provided to the Magistrate by the solicitor for the appellant relevant to this issue.  These were to the effect that the majority of the breaches occurred in the delicatessen section of the store; in circumstances where the delicatessen manager was ill and had significant personal difficulties; that he had been performance managed in the week or two leading up to the breaches; and that he had been stood down after the breaches had been identified. 

53. Apart from his name, the only other information contained in the affidavit, of which the learned Magistrate was not aware, is the medical diagnosis.   The evidence is marginally relevant at best.  There is a negligible prospect that if available, that it would have impacted on the fine imposed.  

54. Discretionary considerations are against receipt of this affidavit.  It was available to the appellant at the time of the hearing.  Further, in my view, if admitted, it would be unlikely to disclose any miscarriage of justice and affect the quantum of the fine imposed. 

Costs

55. In the event that the appeal is dismissed, the respondent seeks its costs to be assessed on the scale. Section 226 of the Justices Act gives the court a broad discretion to make such order as to costs as the judge may think just. It is trite to say that such discretion must be exercised judicially. The purpose of a costs award is to compensate the successful party against its cost of successfully resisting the appeal, rather than as a means of punishing the unsuccessful appellant.

56. The appropriate scale can be found in Schedule 2 of the Justices Regulation 2004 (‘the Regulation’). This provides that the court may award up to $1,800 to the respondent for instructions and preparation for the hearing, including attendance at the hearing.

57. Pursuant to section 3 of schedule 2 of the Regulation, a cost is to be allowed only to the extent to which the incurring of the cost was necessary or proper to achieve justice or to defend the rights of the party, or was not incurred by overcaution, negligence, mistake or merely at the wish of the party.

58. There was a written outline for the respondent in response to the outline from the appellant and a further outline handed up to the court on the day of the hearing of the appeal.  Further, counsel appeared for the respondent instructed by an officer of Crown Law for the day of the hearing, and made oral submissions at the hearing. These matters lead me to be satisfied that there were legal services performed for the respondent and that the services meet the descriptions of instructions, preparation and attendance at the hearing.  In other words, the work done for the respondent complies with the descriptions in the schedule. 

59. I consider an order that the appellant pay the respondent’s costs of the appeal fixed at $1,800 is just and reasonable. In these circumstances, I exercise my discretion to order the appellant to pay the costs of the appeal on this basis. Pursuant to s 232(1) of the Justices Act, I direct that the sum of $1,800 shall be paid by the appellant to the Registrar of the District Court of Brisbane within 21 days in order that such sum be paid over to the respondent.

60. If an alternate order as to costs is sought, then I will allow the parties until 4.00pm on 27 February 2018, to provide no more than a two page written outline to me through my associate.  If necessary, I will relist the matter for hearing at a date to be fixed.

Orders

61. The following orders are made:

(i)      The appeal is dismissed.

(ii)     Woolworth Limited’s application for leave to adduce further evidence is refused.

(iii)    The appellant pay $1,800 cost to the Registrar of the District Court of Brisbane within 21 days in order that such sum be paid over to the respondent.