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This is a Bill, not an Act. For current law, see the Acts databases.
House of Assembly—No 70
As laid on the table and read a first time, 25 February
2004
South Australia
Land
Agents (Indemnity Fund-Growden Default) Amendment
Bill 2004
A Bill For
An Act to amend the Land Agents Act 1994 and to
make a related amendment to the Conveyancers Act 1994.
Contents
Part 1—Preliminary
1 Short title
2 Amendment provisions
Part 2—Amendment of Land
Agents Act 1994
3 Insertion of section 29A
29A Division of indemnity fund into two
parts
4 Amendment of section 50—Agreement
with professional organisation
5 Amendment of Schedule 2
6 Insertion of Schedule 2A
Schedule
2A—Special provisions relating to G.C. Growden Pty
Ltd
Part 3—Amendment of
Conveyancers Act 1994
7 Amendment of
Schedule 2
The Parliament of South Australia enacts
as follows:
This Act may be cited as the Land Agents (Indemnity Fund-Growden Default) Amendment Act 2004.
In this Act, a provision under a heading referring to the
amendment of a specified Act amends the Act so specified.
Part 2—Amendment of Land Agents Act 1994
After section 29 insert:
29A—Division
of indemnity fund into two parts
(1) The indemnity fund is notionally divided
into two parts (Part A and Part B)—
(a) one
part, Part A, is to consist of $15 million of the money standing to the credit
of the indemnity fund at any particular time or, if the balance of the
indemnity fund falls below $15 million at any time, is to consist of the whole
of the money standing to the credit of the indemnity fund while the balance is
below that amount; and
(b) one
part, Part B, is to consist of so much of the money standing to the credit of
the indemnity fund as is not held in Part A at any particular time.
(2) Part A will be available—
(a) for the purposes of this Division; and
(b) for the purposes of any other Act that makes provision for
payments from the indemnity fund,
and
any reference in this Division or in another Act that relates to the indemnity
fund will be taken to be a reference to Part A of the indemnity fund (unless
the contrary intention appears).
(3) Part
B will be available for the purposes of Schedule 2A.
(4) The
Commissioner's powers of investment with respect to the indemnity fund apply to
both Part A and Part B.
(5) This
section expires when Schedule 2A expires and, on that expiry, the division of
the indemnity fund into two parts will cease.
4—Amendment of section 50—Agreement with professional organisation
Section 50(3)—after paragraph (f) insert:
(g) functions or powers under Schedule 2A.
Schedule 2, clause 3(4)—before "Part
3" insert:
Division 3 of
After Schedule 2 insert:
Schedule 2A—Special
provisions relating to G.C. Growden Pty Ltd
1—Interpretation
(1) In this Schedule—
eligible capital loss of an eligible claimant is the qualifying
capital investment made by the eligible claimant less any capital amount
recovered by the eligible claimant with respect to that investment before the
qualifying date;
eligible claimant means a person who—
(a) has made a qualifying capital investment; and
(b) has
suffered pecuniary loss with respect to that investment as a result of
fiduciary default on the part of Growden Investments;
and
(c) as
at the qualifying date, has been unable to recover with respect to that
investment a capital amount or amounts equal to or totalling the amount of the
qualifying capital investment,
but
does not include a person who is (or has at any time been) an associate of G.C.
Growden Pty. Ltd.;
Fund means Part B of the indemnity fund (see section 29A);
Growden Investments means G.C. Growden
Pty. Ltd. and includes any associate of G.C. Growden
Pty. Ltd. (as in existence at any time);
prescribed period means the period of three months
commencing on the day on which this Schedule comes into operation;
qualifying capital investment means—
(a) any
investment of money effected by making a payment to Growden
Investments, or to another person on the advice of Growden
Investments, on or after 1 June 1995, on the understanding that the money would
be lent to a person on the security of a mortgage; or
(b) any
reinvestment of money effected by Growden
Investments, or on the advice of Growden Investments,
on or after 1 June 1995, where the money was originally paid to Growden Investments, or invested on the advice of Growden Investments, on the understanding that the money
would be lent to a person on the security of a mortgage (including in a case
where the original payment or investment occurred before 1 June 1995);
qualifying date means the date on which this Schedule
comes into operation.
(2) For
the purposes of this clause, a person is an associate of G.C. Growden Pty. Ltd. if the person would be an associate of
that company under clause 3(2) of Schedule 2 (assuming (if necessary for the
purposes of this provision) the continued existence of that person and that
company).
(3) For
the purposes of this Schedule, a reinvestment of money within the ambit of
paragraph (b) of the definition of qualifying capital investment
in subclause (1) will be taken to be a qualifying capital investment made by
the person who originally paid or invested the money.
(4) For the purposes of this Schedule, fiduciary
default on the part of Growden Investments will be
taken to include—
(a) a defalcation, misappropriation or misapplication of another
person's money; or
(b) a failure to disclose material facts with respect to the
investment of another person's money.
(5) If
a person who has died could reasonably be expected to have been an eligible
claimant under this Schedule were he or she still alive, the personal
representative of that person will be taken to be an eligible claimant and any
compensation recovered by the personal representative under this Schedule will
be payable to the person's estate.
2—Entitlement
to claim compensation
(1) Subject
to this Schedule, an eligible claimant may claim compensation under this
Schedule.
(2) A
claim for compensation under this Schedule by an eligible claimant cannot
exceed the eligible claimant's eligible capital loss.
3—Time
within which claim must be made
(1) A
claim for compensation must be made within the prescribed period.
(2) The Commissioner must, within 21 days after
the commencement of this Schedule, by notice published in a newspaper
circulating generally throughout the State, give notice to persons who may
qualify as eligible claimants under this Schedule of—
(a) the ability to make a claim under this Schedule; and
(b) the fact that a claim for compensation must be made within
the prescribed period.
(3) A
claim that is not made within the prescribed period is barred for the purposes
of this Schedule unless the Court, on application, otherwise determines.
4—Establishment
of claims
(1) A
claim for compensation under this Schedule must be made to the Commissioner in
a manner and form determined by the Commissioner.
(2) The Commissioner may require a person
making a claim—
(a) to furnish further information specified by the
Commissioner;
(b) to verify, by statutory declaration, information furnished
for the purposes of making or establishing a claim.
(3) The Commissioner must, as soon as
practicable after the end of the prescribed period, determine, with respect to
each person who has made a claim to the Commissioner in accordance with this
Schedule—
(a) whether the Commissioner is satisfied that the person is an
eligible claimant under this Schedule; and
(b) if the claim is accepted on that basis, the amount of the
person's eligible capital loss for the purposes of paying compensation under
this Schedule.
(4) The
Commissioner must, by notice in writing, inform each person who has made a
claim of the Commissioner's determination with respect to that person under
subclause (3).
(5) A
person who is dissatisfied with a determination with respect to the person
under subclause (3) may, within one month after receiving notice of the
Commissioner's determination, appeal to the Court against the determination.
5—Entitlement
to compensation
Subject to the provisions of this Schedule, a person whose claim
is accepted is entitled to the payment of compensation under this Schedule for
the person's eligible capital loss.
6—Payment of
compensation
(1) The
payment of compensation will be made by the Commissioner from the Fund.
(2) Unless the Fund is sufficient to pay all
eligible capital losses of all persons whose claims have been accepted, the
Commissioner must establish a scheme for the payment of compensation in stages
based on the following provisions:
(a) subject
to paragraph (b), payments will be made from time to time according to the
relative amount of each entitlement (so that each release of money under the
scheme results in a proportionate reduction in each of the entitlements on
account of the payment of compensation);
(b) the Commissioner may pay out a particular entitlement at any
time if the Commissioner considers that it is efficient to do so for the
purposes of the scheme;
(c) the Commissioner may defer paying compensation at any
particular time because of the state of the Fund (including when the Fund is in
credit).
(3) When
the Commissioner makes a payment of compensation to a person under this clause,
the Commissioner is, to the extent of the payment, subrogated to the rights of
the person against any other person liable at law or in equity for the
fiduciary default on the part of Growden Investments
in respect of which the payment is made.
7—Recovery
of amounts from other sources
(1) If a person who is entitled to, or who has
received, a payment of compensation under this Schedule recovers from another
person or source an amount in respect of the fiduciary default for which
compensation is payable under this Schedule—
(a) the person must immediately notify the Commissioner of the
recovery of that amount; and
(b) the person's entitlement to compensation under this Schedule
is reduced by the amount recovered; and
(c) if
the recovery of the amount and any previous payment of compensation under this
Schedule results in the person recovering a total amount in respect of a
qualifying capital investment that exceeds the person's eligible capital loss,
then the person must immediately pay the excess to the Commissioner for
crediting to the Fund (and that excess will, until paid, be a debt due to the
Crown).
(2) A person must not fail to comply with
subclause (1)(a).
Maximum penalty: $10 000.
8—Accounts
and audit
(1) The
Commissioner must keep proper accounts of all money received and dealt with
under this Schedule.
(2) The
Auditor-General may at any time audit those accounts and in any event must
audit those accounts as part of the annual audit of the indemnity fund under
Part 3.
9—Expiry of
Schedule
(1) This
Schedule will expire on a day to be fixed by proclamation.
(2) The
Governor should not make a proclamation under subclause (1) unless or
until the Commissioner has certified that, on the Commissioner's assessment,
all eligible capital losses have been fully compensated (whether by the payment
of compensation under this Schedule or from other sources).
(3) The expiry of this Schedule—
(a) does not affect any right of subrogation under
clause 6(3); and
(b) does not affect any requirement to comply with
clause 7(1)(a) or any right of recovery under clause 7(1)(c),
and
any such right or requirement may be exercised or enforced as if this Schedule
had not expired.
(4) Any
money received by the Commissioner after the day fixed by the Governor under
subclause (1) on account of the operation of this Schedule will be paid
into the indemnity fund.
(5) This
clause is in addition to, and does not derogate from, the provisions of the Acts
Interpretation Act 1915.
Part 3—Amendment of Conveyancers Act 1994
Schedule 2, clause 2—after subclause (4)
insert:
(4A) A mortgage financier who failed to disclose material facts with respect to the investment of trust money to which this clause applies will be taken to have committed a fiduciary default under Part 4.