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Fiji Commerce Commission v New World Ltd [2016] FJMC 16; Criminal Case 1378.2014 (12 February 2016)

IN THE MAGISTRATE'S COURT AT SUVA

Criminal Case No. 1378/2014

FIJI COMMERCE COMMISSION

-v-

NEW WORLD LIMITED Trading as NEW WORLD SUPERMAKET

Mr.Serupepeli Lagilagi for FCC
Ms.Naidu R. for Accused

JUDGMENT

Relevant Facts

1. Above named accused New World Limited Trading As New World Supermarket charged for the offence of BAIT ADVERTISING Contrary to Section 86 (1) and section 129(3) of the Commerce Commission Decree 2010.

1st count

BAIT ADVERTISING BY NOT OFFERING FOR SUPPLY GOODS AT THAT PRICE, FOR THE PERIOD THAT IS AND IN THE QUANTITIES THAT ARE: Contrary to Section 86(1) of Commerce Commission Decree 2010.

2. As per the charge the accused name New World Limited Trading as NEW WORLD SUPERMAKET being a trader at Yatu Lau Arcade, Suva in the Central Division did on the 17th day of December 2011 engaged in bait advertising by publishing in the Fiji Sun on 17 December 2011 that 5 pieces of Stainless Steel Pot set were on sale for $49.00 until 31 December 2011. However the trader failed according to its published advertisement in the Fiji Sun on 17 December 2011 to offer for supply the 5 pieces of Stainless Steel pot set at $49.00 to one Teresia Canaibau on 17 December 2011.

3. Since the accused plead not guilty the trial fixed for on 13/8/15. Prosecution summonsed 2 witnesses on behalf of prosecution. The accused defended by Ms Naidu of SHIRANI & Co.

Relevant Law

4. The Section 86 of the Commerce Commission Decree 2010 has defines this offence as;

" Bait Advertising.

Sec 86.-(1) A person shall not, in trade or commerce, advertise goods or services for supply at a specified price if there are reasonable grounds, of which the person is aware, or ought reasonable to be aware, for believing that the person will not be able to offer for supply those goods or services at that price for a period that is, and in quantities that are, reasonable having regard to the nature of the market in which the person carries on business and the nature of the advertisement.

(2) A person who has, in trade or commerce, advertised goods or services for supply at a specified price shall offer the goods or services for supply at that price for a period that is, and in quantities that are, reasonable having regard to the nature of the market in which the person carries on business and the nature of the advertisement.

(3) A person who contravenes this section shall be guilty of an offence.

(4) In proceedings for an offence in relation to a failure to offer goods or services to a person (in this subsection referred to as the "customer") in accordance with subsection (2), it is a defence if it is established that –

(a) the defendant offered to supply, or to procure another person to supply, goods or services of the kind advertised to the customer within a reasonable time, in a reasonable quantity and at the advertised price; or

(b) the defendant offered to supply immediately, or to procure another person to supply within a reasonable time, equivalent goods or services to the customer in a reasonable quantity and at the price at which the first-mentioned goods or services were advertised, and in either case; where the offer was accepted by the customer, the defendant has so supplied, or procured another person to supply, goods or services."

5. Therefore the elements of the offence of Bait Advertising could be listed as follows. That;

(a) Any person in trade;

(b)Advertise to supply goods or services at a specified price; a period and in quantities;

(c) which the person having regard to the nature of the market and the nature of the advertisement is aware, or ought reasonable to be aware, for believing that he will not be able to offer for supply those goods or services at that price for a period that is, and in quantities

6. There are no decided case authorities in Fiji for the offence of Bait Advertising. But the prosecution due to the similarity of section 86 of Fiji Commerce Commission Decree And section 56 of Australian Trade Practices Act have submitted a reported persuasive case The Federal court of Australia; that's Wallace v Walplan Pty Ltd [1985] FCA 72; (1985) 5 FLR 315 Trade Practices (11 March 1985). By submitting the same prosecution has argued that there was proper offer and acceptance between the parties and which is different from the usual meaning of the offer and acceptance. Therefore the accused dose not privileged to refuse supply goods byway of refusal of an offer at the contract for sales of good.

The Federal court of Australia in Wallace v Walplan Pty Ltd (supra) said that:

" 37. The obligation of which s56(1) speaks has three aspects, the advertised special price, the supply of the goods or services in reasonable quantities and the supply of those goods or services for a reasonable period..."

"42. in my view, "offer" in sec 56(1) is not used in the contractual sense of the word but it used in the ordinary non-technical meaning of "make available"....."

"46. Having said that, it seems to me that reference to technical distinction between invitation to treat and offers capable of immediate acceptance introduce unnecessary difficulties Section 56 is intended to have a broad reach and no benefit is secured by giving the phrase "offer to supply" anything other than its ordinary and nontechnical meaning. According to the Shorter Oxford English Dictionary "offer" means, in the sense of the word generally prevailing, "to tender for acceptance or refusal, to hold out (a thing) to a person to take if he will"...

"47. Consistent with that meaning, if a corporation in trade or commerce advertises for supply goods or services at a special price, s56(1) obliges that corporation to make available the advertised goods or services at the advertised price for a period that is reasonable

7. Law on the above issue at Fiji is same, that trader does not have privilege to say "no" to a customer as the liberty of contract has been regulated by statutes. Therefor this court agreed that this incident has to consider on differently from general law of contracts.

8. Sec 4 of FCC Decree has provided " "supply" with its cognate expressions, includes to sell, or to agree to sell, to offer, advertise, have in possession for any such purposes, expose, transmit, convey, deliver, make or prepare for sale, or to hire or to exchange or dispose of for any consideration whatsoever, or to transmit, convey or deliver in pursuance of a sale, hiring, exchange or disposal as aforesaid;..." and this is something huge than the normal "offer" at law of contract.

9. Therefor this bench agreed on the fact that the defence of "No Contract" or liberty of contract has to keep away from this matter. But this court noticed the defence is not disputing the existence of contract for sale of good between them; but they were prevent by complainant/ victim customer by preforming the same as they tried to supply as mentioned in advertisement.

10. The prosecution has mentioned as this is an offence of strict liability therefore there is no need to consider mental element of the offence; but this bench disagree. Since the section 86 of FCC Decree containing words such as "...reasonable grounds, of which the person is aware, or ought reasonable to be aware, for believing..." And ".....reasonable having regard to the nature of the market in ...." This bench have no hesitation to say that this is not an offence of strict liability and mental element is playing vital part in its elements as in other offence.

11.The "mens rea" or the mental element of this offence is that any trader knowingly or intentionally advertising to supply good or service when considering with the relevant market or business which is unrealistic in nature in order to lure public to their shops. Therefore as long as the items or service available or trader ready to provide the same or taking reasonable attempt to provide the good or services with the trader dose not liable for this offence. When considering the all of section 86 (4) the defence It is evident this defence has been recognised by the decree itself. The reason for introducing this offence is to prevent traders from attracting customers by false or misleading advertisements. Unless all the shop owners might facing the threat of being charged under this section if their out of stocks at the time of any customers arrival.

12. The "actus rea" or physical element of this offence is publication of advertisement contain false information. To ascertained or convict any person under this section it is essential to check the intention and only with physical element it is impossible. Therefore it is clear this is not an offence which has strict liability but general liability.

13. In State v Aiyaz [2009] FJHC 186; HAC033.2008 (31 August 2009) Justice Daniel Goundar differentiates the guiding rules between High Court and Magistrates Court.

"The test under section 293(1) is settled and is more stringent than the test under section 210 of the Criminal Procedure Code, which governs an application for no case to answer in the Magistrates' Court.

The test for no case to answer in the Magistrates' Court under section 210 is adopted from the Practice Direction, issued by the Queen's Bench Division in England and reported in [1962] 1 All E.R 448 (Moiden v R (1976) 27 FLR 206). There are two limbs to the test under section 210:

[i] Whether there is no evidence to prove an essential element of the charged offence;

[ii] Whether the prosecution evidence has been so discredited or is so manifestly unreliable that no reasonable tribunal could convict.

An accused can rely on either limb of the test under section 210 to make an application for no case to answer in the Magistrates' Court."

14. In R V Galbraith (1981) 2 ALL ER 1060 AT 1060, English Court Noted;

"How then should the Judge approach a submission of "no case"? [1] If there is no evidence that the crime alleged has been committed by the defendant, there is no difficulty. The Judge will of course stop the case. [2] The difficulty arises where there is some evidence but it is of a tenuous character, for example because of inherent weakness or vagueness or because it is inconsistent with other evidence. (a) Where the Judge comes to the conclusion that the Crown's evidence, taken at the highest, is such that a jury properly directed could not properly convict on it; it is his duty, on a submission being made, to stop the case. (b) where however the Crown's evidence is such that its strength or weakness depends on the view to be taken of a witness' reliability, or other matters which are generally speaking within the province of the jury and where on one possible view of the facts there is evidence on which a jury could properly come to the conclusion that the defendant is guilty, then the Judge should allow the matter to be tried by the jury (Magistrate)".

15. Since the accused has not disputing publication of advertisement the main issue before this court is;

A] Whether there is sufficient evidence on the fact that accused acted with the intention of misleading public by publication of the said advertisement or not?

If the answer to above is "yes" there will be case to answer and unless there will be no case to answer.

16. In State v Seniloli [2004] FJHC 48; HAC0028.2003S (5 August 2004) Her Ladyship Justice Nazhat Shameem told to assessors (summing up);

"The standard of proof in a criminal case is one of proof beyondd reasonable doubt. This means that you must be satisfied so that you feel sure of the guilt of the accused persons before you express an opinion that they are guilty. If you have any reasonable doubt as to whether the accused persons committed the offence charged against each of them on the Information, then it is your duty to express an opinion that the accused are not guilty. It is only if you are satisfied so that you feel sure of their guilt that you must express an opinion that they are guilty. One of the defence counsels asked you if you had the slightest doubt about the accused's guilt. That is not the correct test. The correct test is whether you have any reasonable doubt about the guilt of the accused."

Evidence

17. To prove their case Prosecution relayed called 2 witnesses including the complainant. PW-1- Teresia Camaibau - She stated on Saturday the 17th December 2011, she saw an advertisement in the "Fiji Sun" by New World Supermarket where some set of pots were being advertised for sale at $49.00 per set.At about 10.00am PW1 was at New World Supermarket Downtown situated along Rodwell Road, to enquire about this pots. While arriving at the store she went straight to where the pots are displayed and notice that there were no pots on display.PW1 than called the employees and told them about the advertisement in the "Fiji Sun", went to see to Manager the employee search for the items on their bulk and said that there are no items in stock.PW1 also noted that while enquiring she saw FCC in the store and complaint to them about the advertisement and gave statement of complaint.

18. During cross examination PW1 stated that she was only looking the pots about a medium size.PW1 also stated in cross examination that she knew New World has branches in Suva, and she did not ask if the items were available in other branch and she did not agree the New World Officers said to her that the pots were available in the Nina Street branch and no items was shown to her by the Manager and she thought the pots were bigger pots.PW1 was shown her statements where she has stated that employees from New World had told her that they would enquire from other branches and inform her. It was pointed out to PW1 about the contradictory statements she has given, this moment she pointed out that she is withdrawing her complaint.

" Q: ......... Can you please look at the bottom far end of the advertisement at the bottom please? Will you confirm that there's a clause in one of the sentences at the bottom, third sentence from the bottom, it says please check in store do you agree that it's written there please check in store? [Whole advertisement read in open court]

A:Yes Sir.

Q:So do you admit that you did not read. I put it to you Madam that this sale as per this advertisement was subject to this 1, 2, 3, 4, 5, 6 conditions do you agree with me? The 6th conditions were subject to this advertisement said in the paper?

A: Sir I didn't read the conditions I just saw that the item or sale and I just went there just to buy it. I saw the items on sale. I went to New World to buy the items."

19. PW2– Ilifereti Savou, (FCC Officer) PW-2 Stated "I am an Inspector of Fiji Commerce Commission.I have been an Inspector for about 30 years.My duties are to inspect charges of any internal program of the Commerce Decree. on 17th December 20. On this day? at Rodwell Road and were doing an inspection where one lady came to us and said that she came for some pots that were advertised in the papers and there was none there. So we took statement and we went to investigate the matter with the Manager.we saw the manager and ask him for the advertised pots and that there was none available at that time. The manager just said there was none at that place. we finish the investigation because it was such a busy day to come back and then interview on Monday. I conducted the interview".

21. At the cross examination PW-2 was asked about whether he gave opportunity to accuses employees to bring pots from other branch and he replied that there is no need for it as soon as he found that said items are not available at the shop they are liable for this offence under section 86.

" Q.-So if I give you the advertisement does it say that the specific items is available in every shop?

A.-From my understanding if it's been not there then it should be in the same shop.

Q.-So you didn't let them to check you did not bother whether they will bring it from other shop the branches?

A.-No.

Q.-Your understanding is that it should be in the same shop, if it's not there they are liable for this offence?

A.-Yea.

Q.-So main reason is to charge this New World because it was not in the shop is it?

A.-It was not in the shop.

Q.-But you don't know whether it was available in other shops, you didn't check it?

A.-No.

Q.-And you didn't bother to check it?

A.-No Sir.

Q.-And you did not give the option to PW1 the complainant to check in other shops?

A.-That's her problem."

Determination

22. After consider the evidence this court thinks that evidence of PW-2 is sufficient to rule this matter. The Section 86(4) has given acceptable defence for the offence itself. PW-1 has refused to allow the accused to bring the item from other branch which is amount to full performance by accused.

23. Further PW-2 who was at the Shop when alleged offence committing said he thinks that's the there is no need to check other shop. Or in other word is not given proper attention to section 86(4) of FCC Decree. Be course PW-1 has mentioned in EX-2 that "....I then enquired from a sales rep regarding the item and he told us that the item advertised was not available in the shop. He would enquire from other branches and inform us......". This is indeed the valid explanation. If none of the New World branches had this advertised item for sale on that day and failed to procure another person to supply within a reasonable time, equivalent goods then the proceeding must be instituted without any hesitation. but the fact of this matter is somewhat deferent.

24. This court noticed that PW-2 has not correctly identified the mischief or wrongful act of treaders meant to prevent by legislatures.it is not failed to provide items on request but advertising something unrealistic with the intention of attracting customers to shops. Failed to provide items have only an evidential value.

25. The actus rea or real offensive act is advertising something unrealistic when considering the particular market. Therefore before charging any accused officers must ascertained whether the price or quantity or if it is to supply service the time is unrealistic or not. Without this it is fruitless if charge merely due to unavailability of item. This court cannot see any evidence regards to this issue. In fact this is nothing else but no evidence on elements of the offence.

26. For the above mentioned reasons it is obviously hard for any reasonable tribunal to convicts as there is no sufficient evidence on every elements of the offence. Therefore this court answered issue no [a] as negative.

27. Therefore court rule that there is no case to answer for accused. Therefore this court acquits the accused and discharges the accused from 1st count of bait adverting.
28.28 days to appeal.

On this 12th day of Feb 2016
Neil Rupasinghe
RESIDENT MAGISTRATE