Court imposes penalties for ignoring ‘do not knock’ sign

13 December 2013

The Federal Court has ordered by consent that AGL South Australia Pty Ltd (AGL SA) and its marketing company, CPM Australia Pty Ltd (CPM), pay a total of $60,000 in penalties for failing to leave a consumer’s premises despite the presence of a ‘Do Not Knock’ sign on the consumer’s front door.

The proceedings related to conduct which occurred in South Australia in November 2011. In this case, the sign was affixed to the consumer’s front door and contained an image of a fist knocking with a line through it and the words “DO NOT KNOCK Unsolicited door-to-door selling not welcome here”. The salesperson nonetheless knocked on the consumer’s door and attempted to negotiate an agreement to supply energy. 

The Court ordered AGL SA to pay a penalty of $35,000 and CPM to pay a penalty of $25,000. The maximum penalty for each breach of the unsolicited consumer agreement provisions of the Australian Consumer Law (ACL) is $50,000.

Justice Middleton found that the conduct of the salesperson was deliberate, stating further that “the contravention subverted both the consumer’s desire not to be disturbed or interrupted by sales representatives and the very protections provided to the consumer by the legislation”. His Honour also stated that “these penalties reflect the need to deter conduct of such seriousness by the relevant Respondents and others in the door-to-door selling industry”.

“These penalties are yet another clear warning that businesses must comply with the unsolicited consumer agreement provisions of the Australian Consumer Law, which are designed to protect consumers in their own homes,” ACCC Commissioner Sarah Court said.

On 11 October 2013, the Court found that AGL SA and CPM breached the ACL by their actions, and a formal declaration has now been made to this effect.

In reaching this conclusion, Justice Middleton found that the do not knock sign conveyed a clear and unambiguous request to leave the premises without knocking on the consumer’s door.

As part of the same proceedings, Justice Middleton ordered by consent that AGL Sales Pty Ltd and AGL SA pay combined penalties of $1.555 million for other unlawful selling practices, including making false representations to consumers. CPM was also ordered to pay $200,000 for its role in the conduct.

Background

11 October 2013 Court confirms salespeople must not ignore ‘do not knock’ signs

21 May 2013 AGL ordered to pay $1.5 million for illegal door-to-door sales practices

27 March 2012 ACCC takes court action against energy retailers for door-to-door sales tactics

Release number: 
302/13
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