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2002-2003
THE
PARLIAMENT OF THE COMMONWEALTH OF
AUSTRALIA
SENATE
FAMILY
LAW AMENDMENT BILL 2003
SUPPLEMENTARY EXPLANATORY MEMORANDUM
Amendments and New
Clauses
to be Moved on Behalf of the
Government
`
(Circulated by authority of the
Attorney-General,
the Hon Daryl Williams AM QC
MP)
TABLE OF CONTENTS
Page
General
Outline 1
Financial Impact
Statement 1
Notes on
Clauses 2
Schedule
6 2
Schedule 7 6
FAMILY LAW AMENDMENT BILL
2003
GENERAL OUTLINE
In line with the Government’s ongoing reform agenda in family law, the Bill makes a range of amendments to the Family Law Act 1975 (the Act). The Government amendments to the Bill amend the binding third party provisions in Schedule 6 and the child representative costs provision in Schedule 7 of the Bill.
The amendments to Schedule 6 insert:
• a provision delaying the commencement of Schedule 6
• a provision to make it clear that the provisions of new Part VIIIAA, which is inserted by Schedule 6, do not effect the operation of other provisions of the Act
• a third party costs provision
• a provision setting out some of the matters that a court must take into account before making an order under Schedule 6, and
• a provision which ensures that Schedule 6 has no effect to the extent to which its operation would result in the acquisition of property otherwise than on just terms.
The amendment to the child representative costs provision in Schedule 7 will clarify that the court has the power to make an order for the costs of a child representative in respect of proceedings in which a child representative is appointed. It will also provide that the fact that the child representative receives funding from a legal aid scheme must not be taken into account by the court when making a costs order. Further, the provision will provide that an order cannot be made against parties to proceedings who are in receipt of legal aid or who would suffer financial hardship if an order was made.
FINANCIAL IMPACT STATEMENT
These Government amendments will have little or no financial impact.
NOTES ON CLAUSES
Clause 2 – Commencement –
1. Clause 2 provides for the commencement of the Act. Subclause 2(1) provides that each provision in column 1 of the table will commence on the day or at the time specified in column 2 of the table.
Amendment 1 - Table item 18
2. This amendment provides for Schedule 6 to commence on the day after the end of the period of 12 months beginning on the day on which this Act receives the Royal Assent.
3. The purpose of the deferred commencement of the provisions in new Part VIIIAA is to ensure that any affected third parties, such as banks or financial services bodies, are given sufficient time to make any necessary changes, for example to their operating systems, as a result of the introduction of these provisions. The deferred commencement will also ensure that any necessary consequential amendments, such as amendments to taxation or social security legislation, can be made before the provisions commence.
4. The deferred commencement was recommended by the Senate Legal and Constitutional Legislation Committee in its report on the provisions of the Bill, tabled on 13 August 2003.
Amendment 2 - Table item 23
5. This amendment provides for new item 29A in Schedule 7, relating to the costs of a child representative, to commence on the 28th day after the day on which this Act receives the Royal Assent.
SCHEDULE 6 – ORDERS AND INJUNCTIONS BINDING THIRD PARTIES
Family Law Act
1975
Item
1 – After section 90
Part VIIIAA – Orders and injunctions binding third parties
Subdivision A – Scope of this Part
Amendment 3 - Section 90ADA - Other provisions of this Act not affected by this Part
6. New section 90ADA makes it clear that the provisions of the new Part VIIIAA do not effect the operation of any other provisions of the Act.
Amendment 4 - Paragraph 90AE(3)(c)
7. The amendment to paragraph 90AE(3)(c) facilitates the addition of new paragraphs 90AE(3)(d) and (e).
Amendment 5 - Paragraphs 90AE(3)(d) and 90AE(3)(e)
8. To allay concerns, new paragraph 90AE(3)(d) removes any doubt that the requirement under subsection 79(2) of the Act that the court shall not make an order under section 79 unless it is satisfied that, in all the circumstances, it is just and equitable to make the order, also applies to an order under subsection 90AE(1) or (2) directed to or altering the rights, liabilities or property interests of a third party.
9. New paragraph 90AE(3)(e) provides that the court may only make an order under subsections 90AE(1) or (2) if the court is satisfied that the order takes into account the matters mentioned in subsection 90AE(4).
Amendment 6 - Subsection 90AE(4)
10. New subsection 90AE(4) sets out a non-exhaustive list of the matters that the court must be satisfied the order takes into account, in proceedings under section 79 of the Act, before making an order binding a third party.
11. The matters that are listed in subsection 90AE(4) are:
(a) the taxation effect (if any) of the order on the parties to the marriage;
(b) the taxation effect (if any) of the order on the third party;
(c) the social security effect (if any) of the order on the parties to the marriage;
(d) the third party’s administrative costs in relation to the order;
(e) if the order concerns a debt of a party to the marriage—the capacity of a party to the marriage to repay the debt after the order is made;
(f) the economic, legal or other capacity of the third party to comply with the order;
(g) if, as a result of the third party being accorded procedural fairness in relation to the making of the order, the third party raises any other matters—those matters;
(h) any other matter that the court considers relevant.
12. While the court is required to take all relevant matters into account in making an order that it considers just and equitable, the purpose of the list of matters in paragraph 90AE(4) is to make clear that before making an order binding a third party, the court will consider a range of matters that relate to the commercial interests of third parties.
13. Examples of other matters that may be relevant include the effect of the order on any veterans’ affairs benefits or family assistance benefits of the parties to the marriage. Another matter that may be relevant is the impact of an order on any parties, other than the third party, that may be affected by an order, such as a bank’s mortgage insurer.
14. New subsection 90AF(4) sets out the same list of matters for consideration by the court in making orders or injunctions under section 114 of the Act.
Amendment 7 - Paragraph 90AF(3)(c)
15. The amendment to paragraph 90AF(3)(c) facilitates the addition of new paragraphs 90AF(3)(d) and (e).
Amendment 8 - Paragraphs 90AF(3)(d), 90AF(3)(e) and 90AF(3)(f)
16. New paragraphs 90AF(3)(d) and (e) impose the requirements that, in proceedings under section 114, the court may only make an order or injunction under subsection 90AF(1) or (2) directed to or altering the rights, liabilities or property interests of a third party if (i) for an order or injunction under subsection 114(1) of the Act, the court is satisfied that, in all the circumstances, it is proper to make the order or grant the injunction, and (ii) for an injunction under subsection 114(3), the court is satisfied that, in all the circumstances, it is just or convenient to grant the injunction.
17. New paragraph 90AF(3)(f) provides that the court may only make an order under subsections 90AF(1) or (2) if the court is satisfied that the order takes into account the matters mentioned in subsection 90AF(4).
Amendment 9 - Subsection 90AF(4)
18. New subsection 90AF(4) sets out a non-exhaustive list of the matters that the court must be satisfied the order takes into account, in proceedings under section 114 of the Act, before making an order binding a third party.
19. While the court is required to take all relevant matters into account in making an order that it considers just and equitable, the purpose of the list of matters in paragraph 90AF(4) is to make clear that before making an order binding a third party, the court will consider a range of matters that relate to the commercial interests of third parties.
20. Examples of other matters that may be relevant include the effect of the order on any veterans’ affairs benefits or family assistance benefits of the parties to the marriage. Another matter that may be relevant is the impact of an order on any parties, other than the third party, that may be affected by an order, such as a bank’s mortgage insurer.
21. New subsection 90AE(4) sets out the same list of matters for consideration by the court in making orders under section 79 of the Act.
Amendment 10 - Section 90AJ – Order for reasonable expenses of third party
22. Section 90AJ gives the court power to make an order for the reasonable expenses, for example the administrative costs, incurred by a third party as a necessary result of an order or injunction under new Part VIIIAA.
23. The amendment provides for the third party to make an application to the court for such an order.
24. The court is given the discretion to make such order for the payment of the reasonable expenses incurred by the third party in relation to the order or injunction as it considers just.
25. The section does not affect the court’s power to make orders for costs under the Act. For example, the court could make orders for costs in respect of applications made by a third party under both section 117 and under the new section 90AJ. Cost orders made under section 117 relate to the costs of proceedings under the Act, whereas cost orders made under section 90AJ will relate to expenses incurred by a third party as a necessary result of an order or injunction that binds that third party.
26. The section also provides that the court must take into account the principle that the parties to the marriage should bear in equal proportions the reasonable expenses of the third party, in making an order for a third party’s costs under section 90AJ.
Amendment 11 - Section 90AK - Acquisition of property
27. Section 90AK clarifies that the court does not have jurisdiction to make an order which would effect an acquisition of property within the meaning of section 51(xxxi) of the Constitution, which prohibits the acquisition of property from any person for any purpose in respect of which the Parliament has power to make laws otherwise than on just terms.
SCHEDULE 7 – MISCELLANEOUS AMENDMENTS
Family Law Act 1975
Amendment 12
Item 29 – Subsection 117(2)
28. The amendment to subsection 117(2) facilitates the addition of new subsections 117(2A), (4) and (5).
Item 29A – At the end of section 117
29. This amendment will insert an amendment to section 117 of the Act that clarifies that a court may make an order about the costs of a child representative in respect of proceedings in which a child representative has been appointed.
30. It will also provide that the fact that the child representative receives funding from a legal aid scheme must not be taken into account by the court when making a costs order.
31. Further, the provision will provide that an order cannot be made against parties to proceedings who are in receipt of legal aid or who would suffer financial hardship if an order was made.
32. In making such an order (if any), the court shall have regard to the matters currently listed in subsection 117(2A) of the Family Law Act.
33. The new amendment to section 117 of the Act responds to a recommendation in the Senate Legal and Constitutional Committee’s report on the provisions of the Bill, tabled on 13 August 2003.
Amendment 13
Item 35 – Application of amendments
34. This amendment will provide that items 29 and 29A of Schedule 7 will apply to proceedings instituted in the court after the commencement of item 35. Item 35 commences on the 28th day after the day on which this Act receives the Royal Assent.