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This is a Bill, not an Act. For current law, see the Acts databases.
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Co-operatives Act 1996
Act No.
TABLE OF PROVISIONS
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PART 1--PRELIMINARY 1
Division 1--Introductory 1
1. Purpose 1
2. Commencement 2
3. Objects of this Act 2
Division 2--Interpretation 2
4. Definitions 3
5. Qualified privilege 8
Division 3--The co-operative principles 9
6. Co-operative principles 9
7. Interpretation to promote co-operative principles 11
Division 4--Application of Corporations Law 11
8. Corporations Law applying under its own force 11
9. Corporations Law adopted by this Act or the regulations 13
10. Interpretation of adopted provisions of Corporations Law 13
11. Implied adoption of regulations and other provisions of
Corporations Law 15
12. Effect of amendments to adopted provisions of Corporations Law 16
PART 2--FORMATION 17
Division 1--Types of co-operatives 17
13. Types of co-operatives 17
14. Trading co-operatives 17
15. Non-trading co-operatives 17
Division 2--Formation meeting 18
16. Formation meeting 18
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Division 3--Approval of disclosure statement and rules 20
17. Approval of disclosure statement 20
18. Approval of rules 21
Division 4--Registration of proposed co-operative 22
19. Application for registration of proposed co-operative 22
20. Registration of co-operative 24
21. Incorporation and certificate of registration 24
Division 5--Registration of an existing body corporate 26
22. Existing body corporate can be registered 26
23. Formation meeting 26
24. Application for registration 27
25. Requirements for registration 28
26. Certificate of registration 29
27. Effect of registration 29
Division 6--Conversion of co-operative 30
28. Conversion of co-operative 30
Division 7--Appeals 30
29. Appeal against refusal to approve disclosure statement 30
30. Appeal against refusal to approve draft rules 30
31. Appeal against refusal to register 31
32. Registrar to comply with Tribunal determination 31
Division 8--General 31
33. Stamp duty exemption for certain co-operatives 31
34. Acceptance of money by proposed co-operative 32
35. Issue of duplicate certificate 32
PART 3--LEGAL CAPACITY AND POWERS 33
Division 1--General powers 33
36. Effect of incorporation 33
37. Power to form companies and enter into joint ventures 33
Division 2--Doctrine of ultra vires abolished 34
38. Interpretation 34
39. Doctrine of ultra vires abolished 34
40. Legal capacity 34
41. Restrictions on co-operatives in rules 35
42. Results of contravention of restriction in rules 36
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Division 3--Persons having dealings with co-operatives 37
43. Assumptions entitled to be made 37
44. Assumptions 37
45. Person who knows or ought to know is not entitled to make
assumptions 39
46. Lodgment of documents not to constitute constructive knowledge 39
47. Effect of fraud 40
Division 4--Authentication and execution of documents and
confirmation of contracts 40
48. Common seal 40
49. Official seal 40
50. Authentication need not be under seal 41
51. Co-operative may authorise person to execute deed 41
52. Execution under seal 42
53. Contractual formalities 42
54. Other requirements as to consent or sanction not affected 42
55. Transitional 43
Division 5--Pre-registration contracts 43
56. Contracts before registration 43
57. Person may be released from liability but is not entitled to
indemnity 44
58. This Division replaces other rights and liabilities 45
Division 6--Government guarantees 45
59. Government guarantees 45
60. Aggregate liability under guarantees 47
61. Execution of guarantees and entering into of agreements 47
62. Restrictions on shares of co-operative with guarantee 48
63. Restriction on transfer of incorporation 48
PART 4--MEMBERSHIP 49
Division 1--General 49
64. Becoming a member 49
65. Members of associations 49
66. Members of federations 50
67. Qualification for membership 50
68. Membership may be joint 51
69. Members under 18 years of age 51
70. Representatives of bodies corporate 51
71. Notification of shareholders and shareholdings 52
72. Circumstances in which membership ceases--all co-operatives 52
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73. Additional circumstances in which membership ceases--co-
operatives with share capital 53
74. Carrying on business with too few members 54
Division 2--Rights and liabilities of members 55
75. Rights of membership not exercisable until registered etc. 55
76. Liability of members to co-operative 55
77. Co-operative to provide information to person intending to
become a member 56
78. Entry fees and regular subscriptions 56
79. Members etc. may be required to deal with co-operative 57
80. Fines payable by members 58
81. Charge and set-off of co-operative 59
82. Repayment of shares on expulsion 59
Division 3--Death of member 60
83. Meaning of "interest'' 60
84. Transfer of share or interest on death of member 60
85. Transfer of small shareholdings and interests on death 61
86. Value of shares and interests 62
87. Co-operative protected 62
Division 4--Disputes involving members 62
88. Grievance procedure 62
89. Application to Supreme Court 62
Division 5--Oppressive conduct of affairs 63
90. Interpretation 63
91. Application of Division 64
92. Who may apply for court order? 64
93. Orders that the Supreme Court may make 64
94. Basis on which Supreme Court makes orders 65
95. Winding up need not be ordered if oppressed members
prejudiced 66
96. Application of winding up provisions 66
97. Changes to rules 66
98. Copy of order to be lodged with Registrar 67
Division 6--Proceedings on behalf of a co-operative by members and
others 67
99. Bringing, or intervening in, proceedings on behalf of a co-
operative 67
100. Applying for and granting leave 68
101. Substitution of another person for the person granted leave 69
102. Effect of ratification by members 69
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103. Leave to discontinue, compromise or settle proceedings brought,
or intervened in, with leave 70
104. General powers of the Supreme Court 70
105. Power of Supreme Court to make costs order 71
PART 5--RULES 73
106. Effect of rules 73
107. Content of rules 73
108. Purchase and inspection of copy of rules 74
109. False copies of rules 74
110. Model rules 75
111. Rules can only be altered in accordance with this Act 75
112. Approval of alteration of rules 75
113. Alteration by special resolution 76
114. Alteration by resolution of board 76
115. Alteration does not take effect until registered 77
116. Appeal against refusal to approve alteration 77
117. Appeal against refusal to register alteration 78
118. Registrar to comply with Tribunal determination 78
PART 6--ACTIVE MEMBERSHIP 79
Division 1--Definitions 79
119. Primary activity--meaning 79
120. What is active membership? 79
121. What are active membership provisions and resolutions? 79
Division 2--Rules to contain active membership provisions 80
122. Number of primary activities required 80
123. Rules to contain active membership provisions 80
124. Factors and considerations for determining primary activities etc. 80
125. Active membership provisions--trading co-operatives 82
126. Regular subscription--active membership of non-trading co-
operative 82
Division 3--Active membership resolutions 82
127. Notice of meeting 82
128. Eligibility to vote on active membership resolution. 83
129. Eligibility of directors to vote on proposal at board meeting 83
130. Other entitlements of members not affected 84
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Division 4--Cancellation of membership of inactive members 84
131. Cancellation of membership of inactive member 84
132. Share to be forfeited if membership cancelled 85
133. Failure to cancel membership--offence by director 85
134. Deferral of forfeiture by board 86
135. Cancellation of membership prohibited in certain circumstances 86
136. Notice of intention to cancel membership 87
137. Order of Supreme Court against cancellation 87
138. Repayment of amounts due in respect of cancelled membership 88
139. Interest on deposits and debentures 89
140. Repayment of deposits and debentures 90
141. Register of cancelled memberships 91
Division 5--Entitlements of former members of trading
co-operatives 91
142. Application of Division 91
143. Former shareholders to be regarded as shareholders for certain
purposes 91
144. Entitlements of former shareholders on mergers etc. 92
145. Set-off of amounts repaid etc. on forfeited shares 94
146. Entitlement to distribution from reserves 95
147. Registrar may exempt co-operatives from provisions 95
PART 7--SHARES 96
Division 1--Nature of share 96
148. Nature of share in co-operative 96
Division 2--Disclosure 96
149. Disclosure to members 96
Division 3--Issue of shares 97
150. Shares--general 97
151. Minimum paid up amount 97
152. Shares not to be issued at a discount 98
153. Issue of shares at a premium 98
154. Joint ownership of shares 98
155. Members may be required to take up additional shares 99
156. Bonus share issues 100
157. Restrictions on bonus shares 101
158. Notice in respect of bonus shares 101
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Division 4--Beneficial and non-beneficial interest in shares 102
159. Notice of non-beneficial ownership at time of transfer 102
160. Notice of non-beneficial ownership not notified at time of transfer103
161. Registration as beneficial owner of shares notified as
non-beneficially transferred 104
162. Notification of change in nature of shareholding 104
163. Presumption of awareness 105
164. Presumption that shares held non-beneficially 107
165. Noting of beneficial and non-beneficial interests in register of
members 107
166. Registration as trustee etc. on death of owner of shares 107
167. Registration as administrator of estate on incapacity of
shareholder 108
168. Registration as Official Trustee in Bankruptcy 108
169. Liabilities of person registered as trustee or administrator 109
170. Notice of trusts in register of members 109
171. No notice of trust except as provided by this Division 109
Division 5--Sale or transfer of shares 110
172. Sale or transfer of shares 110
173. Transfer on death of member 110
174. Restriction on total shareholding 110
175. Transfer not effective until registered 111
Division 6--Repurchase of shares 111
176. Purchase and repayment of shares 111
177. Deposit or debentures in lieu of payment when share repurchased 112
178. Cancellation of shares 114
PART 8--VOTING 115
Division 1--Voting entitlements 115
179. Application of Part 115
180. Voting 115
181. Voting by proxy 115
182. Restriction on voting entitlement under power of attorney 116
183. Restriction on voting by representatives of bodies corporate 116
184. Inactive members not entitled to vote 117
185. Control of the right to vote 117
186. Effect of relevant share and voting interests on voting rights 117
187. Rights of representatives to vote 118
188. Other rights and duties of members not affected by ineligibility to
vote 118
189. Vote of disentitled member to be disregarded 118
Division 2--Resolutions 118
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190. Decisions to be by ordinary resolution 118
191. Ordinary resolutions 119
192. Special resolutions 119
193. How majority obtained is ascertained 120
194. Disallowance by Registrar 120
195. Declaration of passing of special resolution 120
196. Effect of special resolution 121
197. Lodgment of special resolution 121
198. Decision of Registrar on application to register special
resolution 122
Division 3--Postal ballots 122
199. Postal ballots 122
200. Special postal ballots 123
201. When is a special postal ballot required? 124
202. Holding of postal ballot on requisition 125
203. Expenses involved in postal ballots on requisition 126
Division 4--Meetings 126
204. Annual general meetings 126
205. Special general meetings 128
206. Notice of meetings 128
207. Quorum at meetings 128
208. Decision at meetings 128
209. Convening of general meeting on requisition 128
210. Minutes 130
PART 9--MANAGEMENT AND ADMINISTRATION OF CO-
OPERATIVES 131
Division 1--The Board 131
211. Board of directors 131
212. Election of directors 131
213. Qualification of directors 132
214. Disqualified persons 133
215. Meeting of the board of directors 135
216. Transaction of business outside meetings 136
217. Deputy directors 136
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218. Delegation by board 137
219. Removal from and vacation of office 137
Division 2--Duties and liabilities of directors, officers and employees 138
220. Meaning of "officer'' 138
221. Officers must act honestly 139
222. Standard of care and diligence required 140
223. Improper use of information or position 140
224. Court may order payment of compensation 141
225. Recovery of damages by co-operative 141
226. Other duties and liabilities not affected 142
227. Indemnification of officers and auditors 142
228. Adoption of Corporations Law provisions concerning officers of
co-operatives 144
Division 3--Restrictions on directors and officers 144
229. Directors' remuneration 144
230. Certain financial accommodation to officers prohibited 144
231. Financial accommodation to directors and associates 145
232. Restriction on directors of certain co-operatives selling land to
co-operative 149
233. Management contracts 149
Division 4--Declaration of interests 150
234. Declaration of interest 150
235. Declarations to be recorded in minutes 152
236. Division does not affect other laws or rules 152
237. Certain interests need not be declared 153
Division 5--Accounts and audit 153
238. Requirements for accounts and accounting records 153
239. Power of Registrar to grant exemptions 155
240. Meaning of "entity'' and "control'' 155
241. Disclosure by directors 155
242. Protection of auditors etc. 156
243. Financial year 156
Division 6--Registers, records and returns 157
244. Registers to be kept by co-operatives 157
245. Location of registers 158
246. Inspection of registers etc. 158
247. Use of information on registers 160
248. Notice of appointment etc. of directors and officers 160
249. Annual report 161
250. List of members to be furnished at request of Registrar 162
251. Special return to be furnished at request of Registrar 162
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Division 7--Name and registered office 162
252. Name to include certain matter 162
253. Use of abbreviations 163
254. Name to appear on business documents etc. 164
255. Change of name of co-operative 165
256. Registered office of co-operative 166
PART 10--FUNDS AND PROPERTY 167
Division 1--Power to raise money 167
257. Meaning of obtaining financial accommodation 167
258. Fund raising to be in accordance with Act and regulations 167
259. Limits on deposit taking 167
260. Members etc. not required to see to application of money 169
261. Registrar's directions re fundraising 169
262. Subordinated debt 170
263. Application of Corporations Law to issues of debentures 170
264. Disclosure statement 171
265. Approval of board for transfer of debentures 172
266. Application of Corporations Law--re-issue of redeemed
debentures 172
267. Compulsory loan by member to co-operative 172
268. Interest payable on compulsory loan 174
Division 2--Charges 175
269. Registration of charges 175
Division 3--Receivers and other controllers of property of
co-operatives 176
270. Receivers and other controllers of property of co-operatives 176
Division 4--Disposal of surplus from activities 176
271. Retention of surplus for benefit of co-operative 176
272. Application for charitable purposes or members' purposes 176
273. Distribution of surplus or reserves to members 176
274. Application of surplus to other persons 177
Division 5--Acquisition and disposal of assets 178
275. Acquisition and disposal of assets 178
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PART 11--RESTRICTIONS ON THE ACQUISITION OF
INTERESTS IN CO-OPERATIVES 180
Division 1--Restrictions on share and voting interests 180
276. Application of Part 180
277. Notice required to be given of voting interest 180
278. Notice required to be given of substantial share interest 180
279. Requirements for notices 181
280. Maximum permissible level of share interest 181
281. Shares to be forfeited to remedy contravention 182
282. Powers of board in response to suspected contravention 183
283. Powers of Supreme Court with respect to contravention 183
284. Co-operative to inform Registrar of interest over 20% 184
285. Co-operative to keep register 185
286. Unlisted companies to provide list of shareholders etc. 185
287. Excess share interest not to affect loan liability 186
288. Extent of operation of Division 186
289. Registrar may grant exemption from Division 187
Division 2--Restrictions on certain share offers 187
290. Share offers to which Division applies 187
291. Requirements to be satisfied before offer can be made 188
292. Some offers totally prohibited if they discriminate 188
293. Offers to be submitted to board first 189
294. Announcements of proposed takeovers concerning proposed
company 189
295. Additional disclosure requirements for offers involving
conversion to company 191
296. Consequences of prohibited offer 192
297. Registrar may grant exemptions 192
PART 12--MERGER, TRANSFER OF ENGAGEMENTS,
WINDING UP 193
Division 1--Mergers and transfers of engagements 193
298. Application of Division 193
299. Mergers and transfers of engagements of local co-operatives 193
300. Requirements before application can be made 193
301. Disclosure statement required 193
302. Making an application 195
303. Approval of merger 195
304. Approval of transfer of engagements 196
305. Transfer of engagements by direction of Registrar 196
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Division 2--Transfer of incorporation 198
306. Application for transfer 198
307. Requirements before application can be made 198
308. Meaning of "new body'' and "transfer'' 199
309. New body ceases to be registered as co-operative 199
310. Transfer not to impose greater liability etc. 199
311. Effect of new certificate of registration 200
312. New body is a continuation of the co-operative 200
313. Stamp duty 201
Division 3--Winding up 201
314. Methods of winding up 201
315. Winding up on Registrar's certificate 201
316. Application of Corporations Law to winding up 202
317. Restrictions on voluntary winding up 203
318. Commencement of members' voluntary winding up 204
319. Distribution of surplus--non-trading co-operatives 204
320. Liquidator--vacancy may be filled by Registrar 205
321. Review of liquidator's remuneration 206
322. Liability of member to contribute in a winding up where shares
forfeited etc. 206
Division 4--Administration of co-operative--adoption of
Corporations Law 207
323. Adoption of Part 5.3A of Corporations Law 207
Division 5--Appointment of administrator 207
324. Appointment of administrator 207
325. Effect of appointment of administrator 208
326. Revocation of appointment 208
327. Expenses of administration 210
328. Liabilities arising from administration 210
329. Additional powers of Registrar 211
330. Stay of proceedings 212
331. Administrator to report to Registrar 212
Division 6--Effect of merger etc. on property, liabilities etc. 212
332. How this Division applies to a merger 212
333. How this Division applies to a transfer of engagements 213
334. How this Division applies to a transfer of incorporation 213
335. Effect of merger etc on property, liabilities etc. 214
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Division 7--Miscellaneous 215
336. Grounds for winding up, transfer of engagements, appointment of
administrator 215
337. Adoption of Corporations law concerning reciprocity with other
jurisdictions 217
338. Adoption of Corporations Law concerning insolvent co-
operatives 218
PART 13--ARRANGEMENTS AND RECONSTRUCTIONS 219
Division 1--General requirements 219
339. Requirements for binding compromise or arrangement 219
340. Supreme Court ordered meeting of creditors 220
341. Registrar to be given notice and opportunity to make submissions 220
342. Results of 2 or more meetings 221
343. Persons disqualified from administering compromise etc. 222
344. Adoption of provisions of Corporations Law and application to
person appointed 223
345. Copy of order to be attached to rules 223
346. Directors to arrange for reports 224
347. Power of Supreme Court to restrain further proceedings 224
348. Supreme Court need not approve compromise or arrangement
takeovers 225
Division 2--Explanatory statements 225
349. Explanatory statement required to accompany notice of meeting
etc. 225
350. Requirements for explanatory statement 227
351. Contravention of Division--offence by co-operative 228
352. Provisions for facilitating reconstructions and mergers 228
Division 3--Acquisition of shares of dissenting shareholders 230
353. Definitions 230
354. Schemes and contracts to which Division applies 231
355. Acquisition of shares pursuant to notice to dissenting shareholder 231
356. Restrictions when excluded shares exceed 10% 232
357. Remaining shareholders may require acquisition 233
358. Transfer of shares pursuant to compulsory acquisition 234
359. Disposal of consideration for shares compulsorily acquired 235
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Division 4--Miscellaneous 236
360. Notification of appointment of scheme manager 236
361. Power of Supreme Court to require reports 236
362. Effect of out-of-jurisdiction compromise or arrangement 237
363. Jurisdiction to be exercised in harmony with Corporations Law
jurisdiction 237
364. Registrar may appear etc. 237
PART 14--FOREIGN CO-OPERATIVES 237
Division 1--Introductory 238
365. Definitions 238
366. Co-operatives law 238
Division 2--Registration of foreign co-operatives 239
367. Operation of foreign co-operatives in Victoria 239
368. What constitutes carrying on business 239
369. Application for registration of participating co-operative 240
370. Application for registration of non-participating co-operative 241
371. Registrar to approve rules of non-participating co-operative 242
372. Name of foreign co-operative 242
373. Registration of foreign co-operative 243
374. Application of Act and regulations to foreign co-operatives 243
375. Registrar to be notified of certain changes 243
376. Balance sheets 244
377. Cessation of business 245
378. Co-operative proposing to register as a foreign co-operative 245
Division 3--Mergers and transfers of engagements 246
379. Who is the appropriate Registrar? 246
380. Authority for merger or transfer of engagements 246
381. Requirements before application can be made 247
382. Disclosure statement required 248
383. Making an application 249
384. Approval of merger 250
385. Approval of transfer of engagements 251
386. Effect of merger or transfer of engagements 252
387. Division applies instead of certain other provisions of this Act 255
PART 15--SUPERVISION AND PROTECTION OF CO-
OPERATIVES 256
Division 1--Supervision and inspection 256
388. Definitions 256
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389. "Co-operative'' includes subsidiaries, foreign co-operatives and
co-operative ventures 256
390. Appointment of inspectors 257
391. Registrar and investigators have functions of inspectors 257
392. Inspector's identity card 257
393. Inspectors may require certain persons to appear, answer
questions and produce documents 257
394. Inspectors' powers of entry 258
395. Powers of inspectors on premises entered 259
396. Functions of inspectors in relation to relevant documents 260
397. Offence--failing to comply with requirements of inspector 261
398. Protection from incrimination 261
399. Search warrants 262
400. Copies or extracts of records to be admitted in evidence 264
401. Privilege 264
402. Police aid for inspectors 266
Division 2--Inquiries 266
403. Definitions 266
404. Appointment of investigators 267
405. Powers of investigators 268
406. Examination of involved person 269
407. Privilege 270
408. Offences by involved person 270
409. Offences relating to documents 272
410. Record of examination 273
411. Report of investigator 273
412. Proceedings following inquiry 275
413. Admission of investigator's report as evidence 275
414. Costs of inquiry 276
Division 3--Prevention of fraud etc. 277
415. Falsification of records 277
416. Fraud or misappropriation 277
417. Offering or paying commission 278
418. Accepting commission 278
419. False statements in loan application etc. 278
Division 4--Miscellaneous powers of the Registrar 279
420. Application for special meeting or inquiry 279
421. Holding of special meeting 280
422. Expenses of special meeting or inquiry 280
423. Power to hold special inquiry into co-operative 281
424. Special meeting following inquiry 281
425. Information and evidence 281
426. Extension or abridgment of time 281
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427. Power of Registrar to intervene in proceedings 282
PART 16--ADMINISTRATION OF THIS ACT 283
Division 1--The Registrar 283
428. Appointment of Registrar 283
429. Registrar's functions 283
430. Deputy Registrar and other staff 283
431. Delegation by Registrar 283
432. Register of Co-operatives 284
433. Keeping of registers 284
434. Disposal of records by Registrar 284
435. Inspection of Register 285
436. Approvals by Registrar 286
437. Lodgment of documents 286
438. Method of lodgment 286
439. Power of Registrar to refuse to register or reject documents 287
Division 2--Evidence 287
440. Certificate of registration 287
441. Certificate evidence 288
442. Orders published in the Government Gazette 288
443. Records kept by co-operatives 289
444. Minutes 289
445. Official certificates 290
446. The Registrar and proceedings 290
447. Rules 290
448. Registers 291
PART 17--OFFENCES AND PROCEEDINGS 292
449. Offences by officers of co-operatives 292
450. Notice to be given of conviction for offence 292
451. Secrecy 293
452. False or misleading statements 296
453. Further offence for continuing failure to do required act 297
454. Civil remedies 298
455. Injunctions 299
456. Proceedings for offences etc. 301
PART 18--GENERAL 302
457. Exemption from stamp duty 302
458. Co-operative ceasing to exist 302
459. Service of documents on co-operative 302
460. Service on member of co-operative 303
461. Reciprocal arrangements 304
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462. Translations of documents 304
463. Regulations 305
PART 19--REPEALS, AMENDMENTS, SAVINGS AND
TRANSITIONAL 306
464. Repeal of Co-operation Act 1981 306
465. Repeal of Part VI of the Housing Act 1983 306
466. Savings and transitional provisions 306
467. Amendment of other Acts 306
__________________
SCHEDULES 307
SCHEDULE 1--Matters for which rules must make provision 307
SCHEDULE 2--Relevant interests, associates, related bodies 311
SCHEDULE 3--Registration etc. of charges 319
SCHEDULE 4--Receivers, and other controllers, of property of co-
operatives 350
SCHEDULE 5--Savings and transitional 378
SCHEDULE 6--Amendment of other Acts 385
NOTES 388
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A BILL
to provide for the formation, registration and management of co-
operatives, to repeal the Co-operatives Act 1981 and to repeal Part
IV of the Housing Act 1983 and for other purposes.
Co-operatives Act 1996
The Parliament of Victoria enacts as follows:
PART 1--PRELIMINARY
Division 1--Introductory
1. Purpose
The purpose of this Act is--
(a) to provide a legislative framework for the
5
formation, registration and management of
co-operatives which enables flexibility in the
operation of co-operatives and promotes the
development of co-operatives; and
531107B.I1-24/10/96 1 BILL LA INTRODUCTION 24/10/96
Co-operatives Act 1996
s. 2
Act No.
(b) to repeal the Co-operation Act 1981; and
(c) to repeal Part VI of the Housing Act 1983.
2. Commencement
(1) Part 1 comes into operation on the day on which
this Act receives the Royal Assent.
5
(2) Subject to sub-section (3), the remaining
provisions of this Act come into operation on a
day or days to be proclaimed.
(3) If a provision referred to in sub-section (2) does
not come into operation before 1 January 1999, it
10
comes into operation on that date.
3. Objects of this Act
The objects of this Act are to--
(a) enable the formation, registration and
operation of co-operatives; and
15
(b) promote co-operative philosophy, principles,
practices and objectives; and
(c) protect the interests of co-operatives, their
members and the public in the operations and
activities of co-operatives; and
20
(d) ensure that the directors of co-operatives are
accountable for their actions and decisions to
the members of co-operatives; and
(e) encourage and facilitate self-management by
co-operatives at all levels; and
25
(f) encourage the development, integration and
strengthening of co-operatives at local,
regional, national and international levels by
supporting and fostering State and National
peak organisations and co-operative
30
instrumentalities.
Division 2--Interpretation
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Co-operatives Act 1996
s. 4 Act No.
4. Definitions
(1) In this Act--
"accounting records" include--
(a) invoices, receipts, orders for the
payment of money, bills of exchange,
5
cheques, promissory notes, vouchers
and other documents of prime entry;
and
(b) documents and records that record
those entries; and
10
(c) any working papers and other
documents that are necessary to explain
the methods and calculations by which
accounts are made up;
"accounts" means profit and loss accounts and
15
balance-sheets and includes statements,
reports and notes (other than auditors' reports
and directors' reports) attached to or intended
to be read with any of those accounts or
balance-sheets;
20
"Administrative Appeals Tribunal" means the
Administrative Appeals Tribunal established
under the Administrative Appeals
Tribunal Act 1984;
"agreement" means an agreement, arrangement
25
or understanding--
(a) whether formal or informal or partly
formal and partly informal;
(b) whether written or oral or partly written
and partly oral; and
30
(c) whether or not having legal or equitable
force and whether or not based on legal
or equitable rights;
3
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"alter'', in relation to the rules of a co-operative
includes add to, substitute and rescind;
"associate" has the meaning given by Schedule 2;
"association" means--
(a) an association registered under this
5
Act; or
(b) the Co-operative Federation of Victoria
Ltd;
"board" means the board of directors of a co-
operative and includes a committee of
10
management of a co-operative;
"component co-operative" means a member of
an association;
"co-operative" means a body registered under
this Act as a co-operative and includes an
15
association or federation;
"Co-operative Federation of Victoria Ltd"
means the Co-operative Federation of
Victoria Ltd established under the Co-
operation Act 1981.
20
"debenture" means a document issued by a co-
operative that evidences or acknowledges
indebtedness of the co-operative in respect of
money that is or may be deposited with or
lent to the co-operative, whether constituting
25
a charge on property of the co-operative or
not and includes a unit of a debenture but
does not include--
(a) a cheque, order for the payment of
money or bill of exchange; or
30
(b) a promissory note having a face value
of not less than $50 000; or
4
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(c) any other document of a class that is
prescribed as exempt from this
definition;
"deed of arrangement" means a deed of
arrangement executed under Part 5.3A of the
5
Corporations Law as adopted and applying
under this Act or such a deed as varied and in
force from time to time;
"deposit taking co-operative" means a co-
operative which is permitted to under section
10
259 to accept money on deposit;
"director", in relation to a co-operative,
includes--
(a) a person who occupies or acts in the
position of a director or member of the
15
board of a co-operative, whether or not
the person is called a director and
whether or not the person is validly
appointed or duly authorised to act in
the position; and
20
(b) a person in accordance with whose
directions or instructions the directors
or members of the board of directors of
the co-operative are accustomed to act;
"federation" means a federation registered under
25
this Act;
"foreign co-operative" means a body corporate
that is registered, incorporated or formed
under, or subject to, a law in force outside
Victoria (including outside Australia), that
30
regulates co-operatives or organisations
having attributes the same as or similar to co-
operatives but does not include--
(a) a body registered under the
Corporations Law of Australia; or
35
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(b) a financial institution or foreign society
registered under financial institutions
legislation within the meaning of the
Financial Institutions (Victoria) Code;
"inspector" means a person appointed as an
5
inspector under Part 15;
"model rules" means the model rules approved
by the Registrar under Part 5;
"mortgage" includes lien, charge or other
security over property;
10
"non-trading co-operative" means a non-trading
co-operative within the meaning of section
15;
"officer", in relation to a co-operative, means--
(a) a director, secretary or employee of the
15
co-operative;
(b) a person who is concerned, or takes
part, in the management of the co-
operative, whether or not as a director;
or
20
(c) a receiver and manager, appointed
under a power contained in an
instrument, of property of the co-
operative; or
(d) an administrator of a deed of
25
arrangement executed by the co-
operative; or
(e) a liquidator or provisional liquidator
appointed in a voluntary winding up of
the co-operative; or
30
(f) an administrator of the co-operative
appointed under--
6
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(i) Part 5.3A of the Corporations Law
as adopted and applying under this
Act; or
(ii) Division 5 of Part 12 of this Act;
(g) a trustee or other person administering a
5
compromise or arrangement made
between the co-operative and another
person;
"primary activity" has the meaning given by
section 119;
10
"principal executive officer", in relation to a co-
operative or to a subsidiary of a co-operative,
means the principal executive officer of the
co-operative or subsidiary for the time being,
by whatever name called, and whether or not
15
that officer is a director or the secretary;
"records" includes books, accounts, accounting
records, minutes, registers, deeds, writings,
documents and other sources of information
compiled, recorded or stored in written form
20
or on microfilm, or by electronic process, or
in any other manner or by any other means;
"Register" means the Register of Co-operatives
established under Part 16;
"Registrar" means the person for the time being
25
holding the office of Registrar of Co-
operatives under this Act;
"related" (in the context of related bodies
corporate) has the meaning given by
Schedule 2;
30
"relevant interest" has the meaning given by
Schedule 2;
"rule" means registered rule of a co-operative for
the time being in force;
7
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"seal" in relation to a co-operative, means
common seal or official seal;
"share" means share in the share capital of a co-
operative;
"subordinated debt" has the meaning given by
5
section 262;
"subsidiary" has the same meaning as in the
Corporations Law;
"surplus", in relation to a co-operative, means
the excess of income over expenditure after
10
making proper allowance for taxation
expense, depreciation in value of the
property of the co-operative and for future
contingencies;
"trading co-operative" means a trading co-
15
operative within the meaning of section 14.
(2) In this Act--
(a) a reference to a function includes a reference
to a power, authority and duty; and
(b) a reference to the exercise of a function
20
includes, in relation to a duty, a reference to
the performance of the duty.
5. Qualified privilege
(1) Where this Act provides that a person has
qualified privilege in respect of an act, matter or
25
thing, the person, in respect of that act, matter or
thing, the person, in respect of that Act matter or
thing--
(a) has qualified privilege in proceedings for
defamation; or
30
(b) is not, in the absence of malice on the
person's part, liable to an action for
defamation at the suit of a person.
8
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(2) In sub-section (1)--
"malice" includes ill-will to the person concerned
or any other improper motive.
(3) Neither this section nor a provision of this Act that
provides as mentioned in sub-section (1) limits or
5
affects any right, privilege or immunity that a
person has, apart from this section or such a
provision, as defendant in proceedings, or an
action, for defamation.
Division 3--The co-operative principles
10
6. Co-operative principles
The co-operative principles are the following
principles--
1. Voluntary and open membership
Co-operatives are voluntary organisations,
15
open to all persons able to use their services
and willing to accept the responsibilities of
membership, without gender, social, racial,
political or religious discrimination.
2. Democratic member control
20
Co-operatives are democratic organisations
controlled by their members, who actively
participate in setting their policies and
making decisions. Men and women serving
as elected representatives are accountable to
25
the membership. In primary co-operatives
members have equal voting rights (one
member, one vote) and co-operatives at other
levels are organised in a democratic manner.
3. Member economic participation
30
Members contribute equitably to, and
democratically control, the capital of their
9
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Act No.
co-operative. At least part of that capital is
usually the common property of the co-
operative. They usually receive limited
compensation, if any, on capital subscribed
as a condition of membership. Members
5
allocate surpluses for any or all of the
following purposes: developing the co-
operative, possibly by setting up reserves,
part of which at least would be indivisible;
benefiting members in proportion to their
10
transactions with the co-operative; and
supporting other activities approved by the
membership.
4. Autonomy and independence
Co-operatives are autonomous, self help
15
organisations controlled by their members. If
they enter into agreements with other
organisations, including governments, or
raise capital from external sources, they do
so on terms that ensure democratic control by
20
their members and maintain their co-
operative autonomy.
5. Education, training and information
Co-operatives provide education and training
for their members, elected representatives,
25
managers and employees so they can
contribute effectively to the development of
their co-operatives. They inform the general
public, particularly young people and opinion
leaders, about the nature and benefits of co-
30
operation.
6. Co-operation among co-operatives
Co-operatives serve their members most
effectively and strengthen the co-operative
movement by working together through
35
10
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local, national, regional and international
structures.
7. Concern for the community
While focusing on member needs, co-
operatives work for the sustainable
5
development of their communities through
policies accepted by their members.
7. Interpretation to promote co-operative principles
In the interpretation of a provision of this Act or
the regulations, a construction that would promote
10
co-operative principles is to be preferred to a
construction that would not promote co-operative
principles.
Division 4--Application of Corporations Law
8. Corporations Law applying under its own force
15
(1) The provisions of the Corporations Law (other
than the provisions of the Corporations Law
mentioned in sub-section (2)) are excluded from
applying under their own force to co-operatives.
(2) However, the following provisions of the
20
Corporations Law are not excluded from applying
under their own force to a co-operative--
(a) provisions that relate to any matter that the
regulations provide is not to be excluded
from the operation of the Corporations Law;
25
or
(b) provisions that relate to the role of a co-
operative in the formation of a company; or
(c) provisions that relate to substantial
shareholdings, by or involving a co-
30
operative, in a company; or
11
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(d) provisions that confer or impose functions on
a co-operative as a member, or former
member, of a corporation; or
(e) provisions that relate to dealings by a co-
operative in securities of a body corporate,
5
other than securities of the co-operative
itself; or
(f) provisions that confer or impose functions on
a co-operative in its dealings with a
corporation, not being dealings in securities
10
of the co-operative; or
(g) provisions that relate to securities of a co-
operative, other than shares in, debentures of
or deposits with a co-operative; or
(h) provisions relating to the futures industry; or
15
(i) provisions relating to participants in the
securities industry; or
(j) provisions relating to the conduct of
securities business; or
(k) provisions relating to dealers' accounts and
20
audit; or
(l) provisions relating to money and scrip of
dealers' clients; or
(m) provisions relating to registers of interests in
securities.
25
(3) To remove doubt it is declared that sub-section (1)
does not operate to exclude the operation of Parts
1.2A, 7.11 and 7.12 of the Corporations Law,
except in relation to shares in, debentures of or
deposits with a co-operative.
30
(4) This section does not operate to give rise to any
operation of the Corporations Law, and does not
confer any function under that Law, which that
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Law would not otherwise have or confer of its
own force.
(5) This section has effect despite any provision of the
Corporations (Victoria) Act 1990 or the
applicable provisions of Victoria within the
5
meaning of that Act.
9. Corporations Law adopted by this Act or the
regulations
(1) The regulations may adopt, with or without
specified modifications, a provision of the
10
Corporations Law for application in relation to co-
operatives.
(2) Any provision of this Act or any regulation which
adopts provisions of the Corporations Law for
application in relation to co-operatives operates to
15
apply those provisions as part of this Act and the
adopted provisions are to be read as forming part
of this Act.
(3) If a provision of the Corporations Law is adopted
by any provision of this Act or the regulations,
20
neither the adopted provision nor the adopting
provision gives power to the Australian Securities
Commission to administer the adopted provision
for this Act.
10. Interpretation of adopted provisions of Corporations
25
Law
(1) Provisions of the Corporations Law adopted by
this Act apply with any modifications that may be
necessary or appropriate for the effectual
application of the provisions to co-operatives.
30
(2) Examples of necessary or appropriate
modifications are as follows--
(a) a reference to articles or memorandum of
association is to read as a reference to rules;
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(b) a cross-reference to another provision of the
Corporations Law is, if that cross-reference
is not appropriate (because for example the
provision cross-referred to is not among the
provisions applied), to be read as a cross-
5
reference to the equivalent provision of this
Act;
(c) a reference to the Gazette is to be read as a
reference to the Government Gazette;
(d) a reference to the Commonwealth is to be
10
read as a reference to Victoria;
(e) provisions which are not relevant to co-
operatives or which are incapable of
application to co-operatives are to be
ignored;
15
(f) modifications directed by the Registrar under
sub-section (3).
(3) The Registrar may by order published in the
Government Gazette give directions as to the
modifications that are necessary or desirable for
20
the effectual operation of the adopted provisions
of the Corporations Law.
(4) Provisions of the Corporations Law adopted by or
under this Act apply and are to be interpreted as if
the definitions of words and expressions and other
25
interpretative provisions contained in the
Corporations Law formed part of this Act.
(5) This section has effect subject to any specific
requirements of provisions of this Act that adopt
provisions of the Corporations Law.
30
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11. Implied adoption of regulations and other provisions
of Corporations Law
(1) When a provision of this Act or the regulations
adopts a provision ("the adopted provision'') of the
Corporations Law for application in relation to co-
5
operatives, the following provisions are also
adopted by force of this section and are to be read
as forming part of this Act--
(a) the provisions of any regulation (an "adopted
regulation'') for the time being in force under
10
the adopted provision;
(b) any provision of the Corporations Law that
creates an offence in relation to a
contravention of the adopted provision;
(c) the provisions of Part 9.4B of the
15
Corporations Law for the purposes of any
provision of the Corporations Law adopted
by this Act that is a civil penalty provision
within the meaning of that Part.
(2) The regulations under this Act may prescribe
20
modifications to any of the provisions adopted by
sub-section (1) for the purposes of their
application under this section, and those
provisions apply subject to any such prescribed
modifications.
25
(3) If a provision of the Corporations Law or the
regulations under that Law adopted under this Act
(including under this section) creates an offence
and the penalty for that offence is specified in
another provision ("the penalty provision'') of the
30
Corporations Law or those regulations, the penalty
provision is to be read as forming part of this Act
for the purpose of determining the maximum
penalty applicable to that offence.
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12. Effect of amendments to adopted provisions of
Corporations Law
(1) A provision of the Corporations Law that is
adopted by or under a provision of this Act so
applies as in force from time to time.
5
(2) If a group of provisions of the Corporations Law
is adopted by or under a provision of this Act
(whether by application of a Part or other division
of the Corporations Law or otherwise), and the
Corporations Law is amended so as to insert new
10
provisions in that group of provisions, the new
provisions form part of the group of provisions so
adopted.
_______________
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s. 13 Act No.
PART 2--FORMATION
Division 1--Types of co-operatives
13. Types of co-operatives
(1) A body may be registered under this Act as a co-
operative.
5
(2) A co-operative may be either--
(a) a trading co-operative; or
(b) a non-trading co-operative.
14. Trading co-operatives
(1) A trading co-operative must have a share capital.
10
(2) A trading co-operative is a co-operative that gives
returns or distributions on surplus or share capital.
(3) A trading co-operative must have a membership
of--
(a) 2 or more co-operatives, in the case of an
15
association; and
(b) 2 or more associations, in the case of a
federation; and
(c) 5 or more active members, in the case of any
other trading co-operative.
20
15. Non-trading co-operatives
(1) A non-trading co-operative must not give returns
or distributions on surplus or share capital to
members other than the nominal value of shares
(if any) at winding up.
25
(2) A non-trading co-operative may or may not have a
share capital.
(3) A non-trading co-operative must have a
membership of--
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(a) 2 or more co-operatives, in the case of an
association other than the Co-operative
Federation of Victoria Ltd; and
(b) 2 or more associations, in the case of a
federation; and
5
(c) 5 or more active members, in the case of any
other non-trading co-operative.
(4) The Co-operative Federation of Victoria Ltd is a
non-trading co-operative for the purposes of this
Act.
10
Division 2--Formation meeting
16. Formation meeting
(1) Before a proposed co-operative (other than an
existing body corporate) can be registered, a
formation meeting must be held in accordance
15
with this section.
(2) At the formation meeting--
(a) in the case of a proposed trading co-
operative, a disclosure statement approved
under section 17 must be presented to the
20
meeting;
(b) the proposed rules of the co-operative
approved under section 18 in respect of the
proposed co-operative, and including active
membership provisions in accordance with
25
Part 6, must be passed by two-thirds of the
proposed members of the proposed co-
operative attending the meeting; and
(c) the proposed members of the proposed co-
operative must sign the application for
30
membership which must be in a form
approved by the Registrar; and
18
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(d) the proposed members must elect the first
directors of the proposed co-operative in
accordance with the proposed rules; and
(e) the proposed members must authorise a
person--
5
(i) to apply to the Registrar for registration
of the proposed co-operative; and
(ii) to do any act or thing necessary to have
the proposed co-operative registered.
(3) The formation meeting must be held by--
10
(a) not less than 2 suitably qualified co-
operatives, in the case of an association; and
(b) not less than 2 suitably qualified
associations, in the case of a federation; and
(c) not less than 5 persons suitably qualified to
15
be members of the proposed co-operative in
the case of any other co-operative.
(4) For the purposes of sub-section (3), a person is
suitably qualified to be a member if--
(a) there are reasonable grounds to believe the
20
person will be an active member of the
proposed co-operative; and
(b) in the case of a natural person, the person has
attained the age of 18; and
(c) the person satisfies any other requirements
25
for membership set out in the proposed rules.
(5) Each co-operative forming a proposed association
and each association forming a proposed
federation may be represented at the formation
meeting by one person.
30
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Division 3--Approval of disclosure statement and rules
17. Approval of disclosure statement
(1) A draft disclosure statement of a proposed trading
co-operative must be submitted to the Registrar at
least 28 days (or such shorter period as the
5
Registrar may allow in a particular case) before
the formation meeting is due to be held.
(2) The disclosure statement must contain the
information necessary to ensure that prospective
members are adequately informed of the nature
10
and extent of a person's financial involvement or
liability as a member of the co-operative including
so far as applicable--
(a) the estimated costs of formation; and
(b) the nature of the proposed membership of the
15
co-operative; and
(c) the rights and liabilities attaching to shares in
the proposed co-operative (including the
capital required for the co-operative); and
(d) the projected income and expenditure of the
20
co-operative for its first year of operation;
and
(e) information about any contracts required to
be entered into by the co-operative; and
(f) any other information that the Registrar
25
directs.
(3) The disclosure statement must not include a
statement purporting to be made by an expert or to
be based on a statement made by an expert
unless--
30
(a) the expert has given, and has not withdrawn,
the expert's written consent to the submission
20
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of the disclosure statement with the
statement include in the form and context in
which it is included; and
(b) there appears in the disclosure statement a
statement that the expert has given, and has
5
not withdrawn, the expert's consent.
(4) The Registrar may--
(a) approve the draft statement as submitted; or
(b) approve a different statement to that
submitted; or
10
(c) refuse to approve the statement.
(5) Approval may be given at any time before the
formation meeting is held.
(6) Subject to sub-section (7), the Registrar approves
of a disclosure statement by giving notice of the
15
approval of the statement to the person who
submitted the draft statement to the Registrar.
(7) The Registrar is to be considered to have approved
the disclosure statement as submitted to the
Registrar unless at least 5 days before the
20
formation meeting is due to be held--
(a) the Registrar gives notice of approval of a
different disclosure statement; or
(b) the Registrar gives notice to the person who
submitted the draft statement that the
25
Registrar is still considering the matter; or
(c) the Registrar gives notice of refusal to
approve the disclosure statement.
(8) A notice under this section must be in writing.
18. Approval of rules
30
(1) A draft of the rules proposed for the co-operative
(including active membership provisions in
21
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Act No.
accordance with Part 6) must be submitted to the
Registrar at least 28 days (or such shorter period
as the Registrar may allow in a particular case)
before the formation meeting is due to be held.
(2) The proposed rules must--
5
(a) be in accordance with section 107; and
(b) be in a form that may reasonably be
approved; and
(c) if the rules contain any alterations of the
model rules, be accompanied by a statement
10
setting out the alterations and the reasons for
the alterations.
(3) If the rules do not make provision for any matter
included in the model rules, the Registrar may
approve the relevant provisions of the model rules
15
as rules of the co-operative.
(4) The Registrar may--
(a) approve the rules as submitted; or
(b) approve different rules to those submitted; or
(c) refuse to approve the rules.
20
(5) The Registrar approves of the rules by giving
written notice of the approval of the rules to the
person who submitted the draft alterations to the
Registrar.
(6) The Registrar must give written notice of the
25
refusal to approve the rules to the person who
submitted the rules to the Registrar.
Division 4--Registration of proposed co-operative
19. Application for registration of proposed co-operative
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(1) An application for registration of a proposed co-
operative (other than an existing body corporate)
must--
(a) be made in the form approved by the
Registrar; and
5
(b) be accompanied by the prescribed fee; and
(c) be signed by--
(i) at least 2 directors in the case of an
association or federation; and
(ii) at least 5 suitably qualified members,
10
including 2 directors elected at the
formation meeting, in the case of any
other proposed co-operative; and
(d) be accompanied by--
(i) 2 copies of the proposed rules signed
15
and certified by the persons who acted
as chairperson and secretary at the
formation meeting; and
(ii) in the case of a proposed trading co-
operative, a copy of the disclosure
20
statement presented to the formation
meeting signed and certified by the
persons who acted as chairperson and
secretary at the formation meeting; and
(iii) a statement listing the name, address,
25
occupation and place and date of birth
of each director; and
(iv) any other particulars that the Registrar
may require in a particular case.
(2) The application must be lodged with the Registrar
30
within 2 months after closure of the formation
meeting for the proposed co-operative or within
such extended period as the Registrar may allow.
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s. 20
21
Act No.
20. Registration of co-operative
(1) When an application is made under this Division
for registration of a proposed co-operative, the
Registrar must register the co-operative and its
rules if satisfied that the requirements for
5
registration of the co-operative have been met.
(2) The requirements for registration of a co-operative
under this Division are as follows--
(a) the proposed rules of the proposed co-
operative must be the rules approved by the
10
Registrar under section 18; and
(b) the requirements of this Act and the
regulations must have been complied with in
respect of the proposed co-operative and
compliance must be likely to continue; and
15
(c) the proposed co-operative must be designed
to function in accordance with the co-
operative principles or, if it is not designed to
function entirely in accordance with the co-
operative principles, the Registrar must be
20
satisfied that there are special reasons why
the co-operative should be registered under
this Act; and
(d) there must be no reasonable cause for
refusing registration of the proposed co-
25
operative.
(3) If the Registrar is not satisfied that the
requirements for registration of the co-operative
have been met the Registrar may refuse to register
the co-operative and its rules.
30
21. Incorporation and certificate of registration
(1) The incorporation of the co-operative takes effect
upon the registration of the co-operative.
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(2) On the registration of the co-operative, the
Registrar must issue a certificate of registration.
25
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s. 22
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Division 5--Registration of an existing body corporate
22. Existing body corporate can be registered
A body corporate (other than a co-operative
deemed to be registered under this Act) may apply
to the Registrar to be registered as a co-operative
5
under this Act, if before or after the
commencement of this Act, the body corporate
was--
(a) incorporated or registered or deemed to be
registered under the Corporations Law of
10
Victoria; or
(b) incorporated or registered under any other
Act relating to the incorporation or
registration of bodies corporate.
23. Formation meeting
15
(1) Before applying for registration as a co-operative
the body corporate must pass a special resolution
in accordance with its articles of association or
rules approving of--
(a) the proposed registration; and
20
(b) any alterations of its existing memorandum
and articles of association or rules necessary
to enable the body corporate to comply with
this Act.
(2) At the meeting to pass the special resolution--
25
(a) the proposed rules of the proposed co-
operative approved under section 18, and
including active membership provisions in
accordance with Part 6, must also be passed
by special resolution; and
30
(b) in the case of a proposed trading co-
operative, a disclosure statement approved
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s. 24 Act No.
under section 17 must be presented to the
meeting.
24. Application for registration
An application for registration must be--
(a) in the form approved by the Registrar; and
5
(b) accompanied by the prescribed fee; and
(c) accompanied by--
(i) a declaration in writing signed by the
directors or the committee of
management of the body corporate
10
stating that at a meeting of the directors
or committee they formed the opinion
that the body corporate will be able to
pay its debts as they fall due; and
(ii) a report in the form approved by the
15
Registrar as to the affairs of the body
corporate and showing its assets and
liabilities, made up to the latest
practicable date before the application;
and
20
(iii) a copy of the memorandum and articles
of association or rules of the body
corporate in force at the date of the
application; and
(iv) 2 copies of the proposed rules of the co-
25
operative, as provided for by the special
resolution; and
(v) in the case of a proposed trading co-
operative, a copy of the disclosure
statement presented to the meeting held
30
under section 23 and signed and
certified by the directors or committee
of management of the body corporate;
and
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(vi) a list containing the name, address,
occupation and place and date of birth
of each director; and
(vii) evidence to the satisfaction of the
Registrar of the incorporation of the
5
existing body corporate;
(viii) any other particulars that the Registrar
may require in a particular case.
25. Requirements for registration
(1) When an application is made for registration of a
10
co-operative under this Division, the Registrar
must register the body corporate as a co-operative
under this Act and register its rules under this Act
if the Registrar is satisfied that the requirements
for registration of the co-operative have been met.
15
(2) The requirements for registration of a co-operative
under this Division are as follows--
(a) the proposed rules of the proposed co-
operative must be the rules approved by the
Registrar under section 18; and
20
(b) the requirements of this Act and the
regulations must have been complied with in
respect of the proposed co-operative and
compliance must be likely to continue; and
(c) there must be no reasonable cause for
25
refusing registration of the proposed co-
operative.
(3) If the Registrar is not satisfied that the
requirements for registration of the co-operative
have been met the Registrar may refuse to register
30
the co-operative and its rules.
(4) If the Registrar has determined under this section
to register a body corporate under this Act, the
body corporate must notify the authority
28
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s. 26 Act No.
responsible for registering the body corporate
under the law under which it was previously
registered of that determination.
(5) Despite anything to the contrary in this Division,
the registration of a body corporate as a co-
5
operative does not take effect until the body
corporate ceases to be registered under the law
under which it was previously registered.
(6) The body corporate must notify the Registrar in
writing within 7 days after ceasing to be registered
10
under that other law.
26. Certificate of registration
(1) On the registration of the body corporate as a co-
operative the Registrar must--
(a) issue a certificate of registration; and
15
(b) publish notice of the issue of the certificate
in the Government Gazette.
(2) The corporate name of a body corporate registered
as a co-operative is the name approved by the
Registrar, as specified in the certificate of
20
registration issued by the Registrar.
27. Effect of registration
(1) The body corporate is to be taken to be
incorporated under this Act on its registration.
(2) Except as expressly provided in this Act or the
25
regulations, the registration and incorporation of
the body corporate as a co-operative does not
prejudice any right of a member in respect of any
shares held at the time of registration and
incorporation.
30
(3) The change of registration and incorporation does
not affect the identity of the body corporate which
is deemed to be the same body after registration as
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Act No.
a co-operative as it was before and no act, matter
or thing is affected by the change.
Division 6--Conversion of co-operative
28. Conversion of co-operative
(1) A co-operative may, by alteration of its rules,
5
convert from--
(a) a co-operative with share capital to a co-
operative without share capital or vice versa;
or
(b) a trading co-operative to a non-trading co-
10
operative or vice versa.
(2) An alteration of the rules for the conversion of a
co-operative must be approved by special
resolution passed by means of a special postal
ballot.
15
Division 7--Appeals
29. Appeal against refusal to approve disclosure
statement
The person who submitted a draft disclosure
statement to the Registrar under this Act may
20
appeal to the Administrative Appeals Tribunal
against--
(a) a decision of the Registrar to refuse to
approve the statement; or
(b) a failure of the Registrar to approve the
25
statement.
30. Appeal against refusal to approve draft rules
The person who submitted draft rules to the
Registrar under this Act may appeal to the
Administrative Appeals Tribunal against--
30
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(a) a decision of the Registrar to refuse to
approve the rules; or
(b) a failure of the Registrar to approve the rules.
31. Appeal against refusal to register
The applicants for registration of a proposed co-
5
operative under this Part may appeal to the
Administrative Appeals Tribunal against--
(a) a decision of the Registrar to refuse to
register the co-operative; or
(b) a failure of the Registrar to register the co-
10
operative.
32. Registrar to comply with Tribunal determination
The Registrar must comply with a determination
of the Administrative Appeals Tribunal on an
appeal under this Division.
15
Division 8--General
33. Stamp duty exemption for certain co-operatives
(1) This section applies to a co-operative that--
(a) has as its primary activity the providing of
any community service or benefit; and
20
(b) was, before it was incorporated under this
Act, an unincorporated club, association or
body operating to provide sporting or
recreational facilities for its members and not
carried on for the pecuniary profit of its
25
members.
(2) An instrument transferring to a co-operative to
which this section applies any property which was,
immediately before the co-operative was
incorporated, held by or on behalf of the
30
unincorporated club, association or body is not
chargeable with stamp duty.
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34. Acceptance of money by proposed co-operative
(1) A proposed co-operative or any person on its
behalf or otherwise which accepts any money for
the proposed co-operative before the proposed co-
operative is registered must hold that money on
5
trust until the co-operative is registered.
(2) If a co-operative is not registered within the period
of 3 months after the acceptance of any money
under sub-section (1), the proposed co-operative
or the person who accepted the money on its
10
behalf must refund the money to the person who
paid it.
Penalty: 60 penalty units.
35. Issue of duplicate certificate
The Registrar must issue a duplicate certificate of
15
registration--
(a) if the Registrar is satisfied that the original
certificate is lost or destroyed; and
(b) on payment of the prescribed fee.
20 _______________
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PART 3--LEGAL CAPACITY AND POWERS
Division 1--General powers
36. Effect of incorporation
As a body corporate, a co-operative--
(a) has perpetual succession; and
5
(b) has a common seal; and
(c) may sue and be sued in its corporate name;
and
(d) subject to this Act, is capable of taking,
purchasing, leasing, holding, selling and
10
disposing of real and personal property; and
(e) may do and suffer all acts and things that
bodies corporate may by law do and suffer
and which are necessary or expedient.
37. Power to form companies and enter into joint
15
ventures
Without limiting any other provision of this Act, a
co-operative has power--
(a) to form or participate in the formation of a
body corporate or unit trust;
20
(b) to acquire interests in and sell or otherwise
dispose of interests in bodies corporate, unit
trusts and joint ventures;
(c) to form or enter into a partnership, joint
venture or other association with other
25
persons or bodies.
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Division 2--Doctrine of ultra vires abolished
38. Interpretation
In this Division--
(a) a reference to the doing of an act by a co-
operative includes a reference to the making
5
of an agreement by the co-operative and a
reference to a transfer of property to or by the
co-operative; and
(b) a reference to legal capacity includes a
reference to powers.
10
39. Doctrine of ultra vires abolished
(1) The objects of this Division are--
(a) to provide that the doctrine of ultra vires
does not apply to co-operatives; and
(b) without affecting the validity of a co-
15
operative's dealings with others, to ensure
that the co-operative's officers and members
give effect to the provisions of the co-
operative's rules relating to the primary
activities or powers of the co-operative.
20
(2) This Division is to be construed and have effect in
accordance with sub-section (1).
40. Legal capacity
(1) A co-operative has, both within and outside the
State, the legal capacity of a natural person.
25
(2) Without limiting sub-section (1), a co-operative
has, both within and outside the State, power--
(a) to issue and allot fully or partly paid shares
in the co-operative; and
(b) to issue debentures of the co-operative; and
30
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(c) to distribute any of the property of the co-
operative among the members, in kind or
otherwise; and
(d) to give security by charging uncalled capital;
and
5
(e) to grant a charge on property of the co-
operative; and
(f) to procure the co-operative to be registered
or recognised as a body corporate in any
place outside the State; and
10
(g) to do any other act that it is authorised to do
by any other law (including a law of a place
outside the State).
(3) Sub-sections (1) and (2) have effect in relation to a
co-operative--
15
(a) subject to this Act and the regulations but
despite section 41(2); and
(b) if the co-operative's rules contain an express
or implied restriction on, or an express or
implied prohibition of, the exercise by the
20
co-operative of any of its powers, despite
that restriction or prohibition; and
(c) if the rules of the co-operative contain a
provision stating the objects of the co-
operative, despite that fact.
25
(4) The fact that the doing of an act by a co-operative
would not be, or is not, in its best interests does
not affect its legal capacity to do the act.
41. Restrictions on co-operatives in rules
(1) A co-operative's rules may contain an express
30
restriction on, or an express prohibition of, the
exercise by the co-operative of a power of the co-
operative.
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(2) A co-operative contravenes this section if--
(a) it exercises a power contrary to an express
restriction on, or an express prohibition of,
the exercise of that power, being a restriction
or prohibition contained in the co-operative's
5
rules; or
(b) the rules of the co-operative contain a
provision stating the objects of the co-
operative and the co-operative does an act
otherwise than in pursuance of those objects.
10
(3) An officer of a co-operative who is involved in a
contravention by the co-operative of this section
also contravenes this section.
(4) A person who contravenes this section is not
guilty of an offence.
15
42. Results of contravention of restriction in rules
(1) The exercise of a power or the doing of an act in
contravention of section 41 is not invalid merely
because of the contravention.
(2) An act of an officer of a co-operative is not invalid
20
merely because, by doing the act, the officer
contravenes section 41.
(3) The fact that the exercise of a power or the doing
of an act contravenes or would contravene section
41 may be asserted or relied on only in--
25
(a) a prosecution of a person for an offence
against this Act; or
(b) an application for an order under Division 5
of Part 4; or
(c) an application for an injunction under section
30
455 to restrain the co-operative from entering
into an agreement; or
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(d) proceedings, other than an application for an
injunction, by the co-operative, or by a
member of the co-operative, against the
present or former officers of the co-
operative; or
5
(e) an application by the Registrar or by a
member of the co-operative for the winding
up of the co-operative.
(4) If, but for sub-section (3), a court would have
power under section 455 to grant, on the
10
application of a person, an injunction restraining a
co-operative or an officer of a co-operative from
engaging in particular conduct constituting a
contravention of section 41, the court may, on the
application of that person, order the co-operative
15
or the officer to pay damages to that person or any
other person.
Division 3--Persons having dealings with co-operatives
43. Assumptions entitled to be made
(1) A person is entitled to make the assumptions in
20
section 44 in relation to--
(a) dealings with a co-operative; and
(b) dealings with a person who has, or purports
to have, directly or indirectly acquired title to
property from a co-operative.
25
(2) If a person is entitled to assume a matter, the co-
operative or anyone referred to in sub-section
(1)(b) is not entitled to assert in proceedings in
relation to the dealings that the matter is incorrect.
44. Assumptions
30
(1) Rules complied with: A person may assume that
the co-operative's rules have been complied with.
37
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(2) Director or officer: A person may assume that
anyone who appears, from information provided
by the co-operative that is available to the public
from the Registrar, to be a director or officer of
the co-operative--
5
(a) has been duly appointed; and
(b) has authority to exercise the powers and
perform the duties customarily exercised or
performed by a director or officer of a similar
co-operative.
10
(3) Officer or agent: A person may assume that
anyone who is held out by the co-operative to be
an officer or agent of the co-operative--
(a) has been duly appointed; and
(b) has authority to exercise the powers and to
15
perform the duties customarily exercised or
performed by that kind of officer or agent of
a similar co-operative.
(4) Officer or agent with authority to warrant that
document is genuine or true copy: A person
20
may assume that anyone who is, or may be
assumed to be, an officer or agent of the co-
operative who has authority to issue a document
or a certified copy of a document on its behalf also
has authority to warrant that the document is
25
genuine or is a true copy.
(5) Document duly executed: A person may assume
that a document has been duly executed by the co-
operative if it is signed by two people, one of
whom is, or may be assumed to be, a director of
30
the co-operative, and the other a director or officer
of the co-operative.
(6) Document duly sealed: A person may assume
that a document has been duly sealed by the co-
operative if it bears what appears to be an
35
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s. 45 Act No.
impression of the co-operative's seal and the
sealing of the document appears to be witnessed
by two people, one of whom is, or may be
assumed to be, a director of the co-operative, and
the other a director or officer of the co-operative.
5
(7) Proper performance of duties: A person may
assume that the officers and agents of the co-
operative properly perform their duties to the co-
operative.
45. Person who knows or ought to know is not entitled to
10
make assumptions
This Division does not entitle a person to make an
assumption, and does not prevent an assertion
being made in relation to an assumption if--
(a) the person has actual knowledge that the
15
assumption is not correct; or
(b) the person's connection or relationship with
the co-operative is such that the person ought
to know that the assumption is not correct.
46. Lodgment of documents not to constitute constructive
20
knowledge
(1) A person is not to be considered to have
knowledge of a co-operative's rules, any of the
contents of a co-operative's rules, a document, the
contents of a document, or any particulars, merely
25
because of either or both of the following--
(a) the rules, the document or the particulars
have been lodged with the Registrar;
(b) the rules, the document or the particulars are
referred to in any other document that has
30
been lodged with the Registrar, or lodged
with a person under a previous law
corresponding to a provision of this Act.
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(2) Sub-section (1) does not apply in relation to a
document, or in relation to the contents of a
document, that has been lodged under Division 2
of Part 10 to the extent that the document relates
to a charge that is registrable under that Division
5
or law.
(3) Despite sub-section (1), a member of a co-
operative is to be considered to have knowledge of
the rules of the co-operative.
47. Effect of fraud
10
(1) A person's entitlement under this Division to make
an assumption is not affected merely by the fact
that any person--
(a) has acted or is acting fraudulently in relation
to the dealing or acquisition or purported
15
acquisition of title to property to which the
assumption relates; or
(b) has forged a document that appears to have
been sealed on behalf of a co-operative.
(2) A person is not entitled to make an assumption if
20
the person has actual knowledge of the fraudulent
action or forgery referred to in sub-section (1).
Division 4--Authentication and execution of documents and
confirmation of contracts
48. Common seal
25
A document or proceeding requiring
authentication by a co-operative may be
authenticated under the common seal of the co-
operative.
49. Official seal
30
(1) A co-operative may, if authorised by its rules,
have, for use in place of its common seal outside
40
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s. 50 Act No.
the State where its common seal is kept, one or
more official seals, each of which must be a
facsimile of the common seal of the co-operative
with the addition on its face of the name of every
place where it is to be used.
5
(2) The person affixing such an official seal must, in
writing signed by the person, certify on the
instrument to which it is affixed the date on which
and the place at which it is affixed.
(3) A document sealed with such an official seal is to
10
be considered to be sealed with the common seal
of the co-operative.
50. Authentication need not be under seal
A document or proceeding requiring
authentication by a co-operative may be
15
authenticated by the signature of two people, one
of whom is a director of the co-operative and one
of whom is a director or an officer of the co-
operative and need not be authenticated under the
seal of the co-operative.
20
51. Co-operative may authorise person to execute deed
(1) A co-operative may, by writing under its common
seal, empower a person, either generally or in
respect of a specified matter or specified matters,
as its agent or attorney to execute deeds on its
25
behalf.
(2) A deed signed by such an agent or attorney on
behalf of the co-operative and under the seal of the
agent or attorney, or under the appropriate official
seal of the co-operative, binds the co-operative
30
and has effect as if it were under the common seal
of the co-operative.
(3) The authority of such an agent or attorney, as
between the co-operative and a person dealing
with the agent or attorney, continues during the
35
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period, if any, mentioned in the instrument
conferring the authority or, if no period is so
mentioned, until notice of the revocation or
termination of the authority of the agent or
attorney has been given to the person dealing with
5
the agent or attorney.
52. Execution under seal
A contract or other document executed, or
purporting to have been executed, under the seal
of a co-operative is not invalid merely because a
10
person attesting the affixing of the seal was in any
way, whether directly or indirectly, interested in
that contract or other document or in the matter to
which that contract or other document relates.
53. Contractual formalities
15
(1) So far as concerns the formalities of making,
varying or discharging a contract, a person acting
under the express or implied authority of a co-
operative may make, vary or discharge a contract
in the name of, or on behalf of, the co-operative as
20
if that contract were made, varied or discharged by
a natural person.
(2) The making, varying or discharging of a contract
in accordance with sub-section (1) is effectual in
law and binds the co-operative and other parties to
25
the contract.
(3) This section does not prevent a co-operative from
making, varying or discharging a contract under
its seal.
54. Other requirements as to consent or sanction not
30
affected
This Division does not affect the operation of a
law that requires some consent or sanction to be
obtained, or some procedure to be complied with,
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in relation to the making, varying or discharging
of a contract.
55. Transitional
This Division does not apply in relation to the
making, varying or discharging of a contract
5
before the commencement of this section, but
applies otherwise in relation to a co-operative
whether it gives its authority before, on or after
that commencement.
Division 5--Pre-registration contracts
10
56. Contracts before registration
(1) If a person enters into, or purports to enter into, a
contract on behalf of, or for the benefit of, a
proposed co-operative, the co-operative becomes
bound by the contract and entitled to its benefit if
15
the co-operative, or a co-operative that is
reasonably identifiable with it, is registered and
ratifies the contract--
(a) within a reasonable period after the contract
is entered into; or
20
(b) within any period agreed to by the parties to
the contract.
(2) The person is released from any liability under the
pre-registration contract if the co-operative enters
into another contract in substitution for it--
25
(a) within a reasonable period after the pre-
registration contract is entered into; or
(b) within any period agreed to by the parties to
the pre-registration contract.
(3) The person is liable to pay damages to each other
30
party to the pre-registration contract if a co-
operative is not registered, or a co-operative is
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registered but does not ratify the contract or enter
into a substitute for it--
(a) within a reasonable period after the contract
is entered into; or
(b) within the period agreed to by the parties to
5
the contract.
(4) The maximum amount of damages the person is
liable to pay to a party is the amount the co-
operative would be liable to pay to the party if the
co-operative had been registered and had ratified
10
the contract and then completely failed to perform
it.
(5) If proceedings are brought to recover damages
under sub-section (3) because the co-operative is
registered but does not ratify the pre-registration
15
contract or enter into a substitute for it, the court
may do anything that it thinks just in the
circumstances, including ordering the co-
operative--
(a) to pay all or part of the damages that the
20
person is liable to pay;
(b) to transfer property that the co-operative
received because of the contract to a party to
the contract;
(c) to pay an amount to a party to the contract.
25
(6) If the co-operative ratifies the pre-registration
contract but fails to perform all or part of it, the
court may order the person to pay all or part of the
damages that the co-operative is ordered to pay.
57. Person may be released from liability but is not
30
entitled to indemnity
(1) Any of the parties to the pre-registration contract
may release the person who entered into, or
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purported to enter into, the contract from any
liability in relation to that contract.
(2) The release must be in writing.
(3) The party giving the release is not entitled to
recover damages under section 56 from the
5
person.
(4) Despite any rule of law or equity, the person does
not have any right of indemnity against the co-
operative in respect of the person's liability under
this Division. This is so even if the person was
10
acting, or purporting to act, as trustee for the co-
operative.
58. This Division replaces other rights and liabilities
This Division replaces any rights or liabilities
anyone would otherwise have in relation to the
15
pre-registration contract.
Division 6--Government guarantees
59. Government guarantees
(1) With the approval of the Governor in Council, the
Treasurer may execute a guarantee in favour of
20
any bank or of any other person or body corporate
or unincorporate (including any trustee), approved
by the Treasurer guaranteeing the repayment of
any loan to be made by the bank or approved body
or person to a co-operative.
25
(2) Despite sub-section (1) if a co-operative offers
debentures for subscription and provision is made
in those debentures or in a trust deed relating to
those debentures for the appointment of a trustee
for the holders of the debentures the Treasurer
30
may with the approval of the Governor in Council
execute a guarantee in favour of the trustee
guaranteeing the repayment of the debentures.
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(3) A guarantee must not be executed guaranteeing
the repayment of any loan to be made to a co-
operative unless the co-operative has first entered
into an agreement with the Treasurer with respect
to the conduct of the affairs of the co-operative
5
while the guarantee is in force and containing any
provisions and conditions that are prescribed or
that the Treasurer thinks fit.
(4) Without limiting sub-section (1), the Treasurer
may refuse to execute a guarantee under this
10
section if the co-operative has less than 25 active
members.
(5) The following provisions apply to and with
respect to a guarantee--
(a) the guarantee must be in the form and subject
15
to the terms and conditions that are
prescribed or that the Treasurer thinks fit;
(b) the guarantee may include the interest
charges and expenses chargeable by the
bank, trustee for the holders of debentures or
20
approved person or body (as the case may
be) against the principal debtor in the usual
course of its business and the expenses of
enforcing or obtaining or endeavouring to
enforce or obtain payment of the debt
25
guaranteed and such interest charges and
expenses;
(c) the bank, trustee for the holders of
debentures or approved person or body (as
the case may be) must obtain take and hold
30
the securities (if any) for the payment of the
principal debt that the Treasurer may require;
(d) the bank, trustee for the holders of
debentures or approved person or body (as
the case may be) must not without the
35
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consent in writing of the Treasurer assign or
encumber the benefit of the guarantee.
60. Aggregate liability under guarantees
(1) The Treasurer must not execute a guarantee if the
guarantee would involve the Treasurer in a
5
liability which when added to the total liabilities
subsisting in respect of other guarantees executed
under this Division or any corresponding previous
enactment would in the aggregate exceed the
amount of
10
$20 000 000.
(2) Any sums that may from time to time become due
and payable by the Treasurer under any guarantee
authorised by this Division must be paid out of the
Consolidated Fund (which is hereby to the
15
necessary extent appropriated accordingly).
61. Execution of guarantees and entering into of
agreements
(1) Any guarantee or agreement authorised by this
Division to be executed or entered into by the
20
Treasurer may be executed or entered into for and
on behalf of the Treasurer by any other person
whom the Treasurer may authorise in writing
either generally or in any particular case so to do.
(2) The Treasurer must cause to be published in the
25
Government Gazette notice of the authorisation of
any person to execute a guarantee or enter into an
agreement for and on behalf of the Treasurer.
(3) A guarantee executed or agreement entered into by
a person for and on behalf of the Treasurer is
30
deemed to have been executed or entered into by
the Treasurer.
(4) All courts must take judicial notice of the
signature to a guarantee or agreement of any
person who is or has been authorised by the
35
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Treasurer to execute the guarantee or enter into the
agreement for and on behalf of the Treasurer.
62. Restrictions on shares of co-operative with guarantee
(1) A member of a co-operative in respect of which a
guarantee exists under this Division must not hold
5
shares in the co-operative exceeding a fixed
nominal value determined by the Registrar and
specified in the rules.
(2) Except with the consent of the Registrar, a co-
operative must not repay any amount paid up on a
10
member's shares which is not required for the
purposes of the co-operative while any part of the
loan to which the guarantee under this Division
relates is still owing.
(3) Except with the consent of the Registrar under this
15
sub-section or at the direction of the Registrar
under sub-section (4), a co-operative in respect of
which a guarantee exists under this Division must
not make calls on any amount unpaid on shares
while any part of the loan to which the guarantee
20
under this Division relates is still owing.
(4) If directed by the Registrar, a co-operative in
respect of which a guarantee exists under this
Division must make any calls required by that
direction on any amount unpaid on shares.
25
63. Restriction on transfer of incorporation
A co-operative in respect of which a guarantee
exists under this Division must not apply to
become registered or incorporated as a body
corporate referred to in section 306.
30
_______________
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PART 4--MEMBERSHIP
Division 1--General
64. Becoming a member
(1) On the registration of a co-operative, the persons
who signed the application for registration become
5
members of the co-operative.
(2) Other persons may be admitted as members of the
co-operative as provided by its rules.
(3) A person under the age of 18 may be admitted as a
member of the co-operative unless the rules of the
10
co-operative otherwise provide.
(4) A body corporate is not (merely because it is a
body corporate) disqualified from being a member
of a co-operative unless the co-operative's rules
provide that bodies corporate are disqualified from
15
being members.
(5) If 2 or more co-operatives merge, the members of
the merged co-operative are--
(a) the members of the merging co-operatives;
and
20
(b) other persons admitted as members of the
merged co-operative in accordance with its
rules.
65. Members of associations
(1) The members of an association are--
25
(a) the component co-operatives by which the
association is formed; and
(b) any other co-operative, admitted to
membership in accordance with the rules of
the association; and
30
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(c) any other body corporate or other body
admitted to membership in accordance with
sub-section (2).
(2) A body corporate or other body (not being a co-
operative) may be admitted to membership of the
5
association as a component co-operative if--
(a) it is incorporated or registered under any
other law, whether or not a law of Victoria;
and
(b) in the opinion of the board of the association,
10
it is designed to function in accordance with
co-operative principles; and
(c) it is eligible to be admitted to membership in
accordance with the rules of the association.
66. Members of federations
15
(1) The members of a federation of associations are--
(a) the associations by which the federation is
formed; and
(b) any other associations admitted to
membership in accordance with the rules of
20
the federation; and
(c) any bodies corporate admitted to
membership in accordance with sub-section
(2).
(2) If the Registrar certifies that there is no association
25
to which a particular body corporate could
conveniently or appropriately be admitted to
membership, the body corporate may be admitted
to membership of a federation.
67. Qualification for membership
30
(1) A person is not qualified to be admitted to
membership of a co-operative unless--
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(a) there are reasonable grounds for believing
that the person will be an active member of
the co-operative; and
(b) the person is otherwise eligible under the
rules of the co-operative.
5
(2) The rules of a co-operative must contain
provisions that--
(a) impose a duty on all persons who become
members to be active members; and
(b) explain the consequences of failing to be or
10
ceasing to be an active member.
68. Membership may be joint
Membership of a co-operative may be individual
and, unless the rules of the co-operative provide
otherwise, may be joint.
15
69. Members under 18 years of age
(1) A member of a co-operative is not entitled to
avoid any obligation or liability as a member
under any contract, deed or other document
entered into as a member on any ground relating
20
to minority.
(2) A person under the age of 18 years is not
competent to hold any office in a co-operative.
(3) A member of a co-operative who is under 18 years
of age is not entitled to vote.
25
(4) This section applies only to natural persons.
70. Representatives of bodies corporate
(1) If a body corporate is a member of a co-operative,
it may by instrument served on the co-operative
appoint a person to represent it in respect of its
30
membership.
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(2) A body corporate must not appoint a person to
represent the body corporate as a member of a co-
operative, if he or she is currently a member of the
co-operative or a representative of another body
corporate member.
5
Penalty: 10 penalty units.
(3) The power to appoint a representative is subject to
any restriction imposed by the rules of the co-
operative as to the entitlement of a person to
represent a body corporate.
10
(4) A person is not qualified to be appointed the
representative of a company that is not a listed
corporation (within the meaning of the
Corporations Law) unless the person is an officer,
member or employee of the company.
15
71. Notification of shareholders and shareholdings
On the request of the board of directors of the co-
operative, a body corporate which is a member of
the co-operative must make available for
inspection by the board of directors of the co-
20
operative--
(a) a list of the names of all the shareholders of
that body corporate and the number of shares
held by each shareholder; or
(b) in the case of a body corporate without share
25
capital, a list of the members of the body
corporate.
Penalty: 20 penalty units.
72. Circumstances in which membership ceases--all co-
operatives
30
(1) A person ceases to be a member of a co-operative
in each of the following circumstances and as
otherwise provided by this Act--
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(a) if the member's membership is cancelled
under Part 6;
(b) if the member is expelled or resigns in
accordance with the rules of the co-
operative;
5
(c) if--
(i) the member becomes bankrupt; or
(ii) the member's property becomes subject
to control under the law relating to
bankruptcy--
10
unless provision is made to the contrary in
the rules of the co-operative;
(d) on death;
(e) if the contract of membership is rescinded on
the ground of misrepresentation or mistake;
15
(f) in the case of a member that is a body
corporate, if the body is dissolved.
(2) On the death of a member, the member's estate
remains liable as the member until the member's
personal representative or some other person is
20
registered in the member's place.
73. Additional circumstances in which membership
ceases--co-operatives with share capital
In the case of a co-operative that has a share
capital, in addition to those circumstances in
25
section 72, a member ceases to be a member if--
(a) the member's share is transferred to another
person in accordance with the rules of the co-
operative, and the transferee is registered as
holder in his or her place;
30
(b) the member's share is forfeited in accordance
with this Act or the rules of the co-operative;
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(c) the member's share is sold by the co-
operative under a power conferred by the
rules of the co-operative, and the purchaser is
registered as holder in his or her place;
(d) the member's share is purchased by the co-
5
operative in accordance with this Act;
(e) the amount paid up on the member's shares is
repaid to the member in accordance with the
rules of the co-operative.
74. Carrying on business with too few members
10
(1) If a co-operative continues to carry on business for
more than 28 days after the number of members is
reduced below the minimum number of members
allowed, every person who is a director of the co-
operative during the time when it so continues to
15
carry on business and who knows it is carrying on
business with fewer than the minimum number of
members allowed is guilty of an offence and liable
to a penalty not exceeding 20 penalty units.
(2) Each person who is guilty of an offence under
20
sub-section (1) is also liable to satisfy all
obligations of the co-operative incurred after the
28 days referred to in sub-section (1), and may be
sued without any other member being joined in
the action.
25
(3) The minimum number of members allowed is--
(a) for an association or federation, 2; or
(b) for any other co-operative, 5.
(4) The Registrar may, by order, extend and further
extend in a particular case the period of 28 days
30
referred to in sub-section (1).
(5) An application for an extension must be made--
(a) in a form approved by the Registrar; and
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(b) before the period to be extended expires.
Division 2--Rights and liabilities of members
75. Rights of membership not exercisable until registered
etc.
(1) A member of a co-operative is not entitled to
5
exercise any rights of membership until--
(a) the member's name appears in the register of
members; and
(b) the member has made any payment to the co-
operative in respect of membership or
10
acquired any share or interest that is provided
in the rules of the co-operative.
(2) The board of a co-operative must ensure that the
name of a person admitted to membership is
recorded in the register of members within 28 days
15
after the person is admitted to membership.
Penalty: 20 penalty units.
76. Liability of members to co-operative
(1) A member of a co-operative is not, as such a
member, under any personal liability to the co-
20
operative, except as provided by this section.
(2) A member of a co-operative with a share capital is
liable to the co-operative for the amount, if any,
unpaid on the shares held by the member together
with any charges payable by the member to the co-
25
operative as required by the rules of the co-
operative.
(3) A member of a co-operative without a share
capital is liable to the co-operative for any charges
payable by the member to the co-operative as
30
required by the rules of the co-operative.
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77. Co-operative to provide information to person
intending to become a member
(1) The board of a co-operative must provide each
person intending to become a member of the co-
operative with--
5
(a) a consolidated copy of the rules of the co-
operative; and
(b) a copy of all special resolutions applicable to
the member passed by the members of the
co-operative, except special resolutions
10
providing for an alteration of the rules of the
co-operative; and
(c) a copy of the last annual report of the co-
operative under section 249.
(2) The board of a non-trading co-operative or, with
15
the consent of the Registrar, the board of a trading
co-operative may comply with sub-section (1)
by--
(a) giving the person intending to become a
member notice that the documents referred to
20
in that sub-section may be inspected by the
person at the registered office of the co-
operative; and
(b) making those documents available for
inspection.
25
78. Entry fees and regular subscriptions
(1) The rules of a co-operative may--
(a) require the payment by members of entry
fees and regular subscriptions; and
(b) provide for the repayment of those fees and
30
subscriptions on a person ceasing to be a
member.
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(2) A co-operative must give to any person intending
to become a member written notice of any entry
fees or regular subscriptions payable by a member
to the co-operative.
(3) A person who becomes a member of the co-
5
operative is not liable to pay any entry fees or
regular subscriptions except--
(a) those fees or subscriptions of which the
person was given written notice before
becoming a member; and
10
(b) any regular subscriptions which may be
imposed by any subsequent alteration of the
rules and of which the member has been
given notice.
79. Members etc. may be required to deal with co-
15
operative
(1) The rules of a co-operative may contain provisions
that require a member to have any specified
dealings with the co-operative for a fixed period
and to enter into a contract for that purpose.
20
(2) A co-operative may, if authorised by its rules,
make a contract with a member containing
provisions that require the member to have any
specified dealings with the co-operative for a fixed
period.
25
(3) In particular, the provisions of the rules or a
contract may require a member--
(a) to sell products through or to the co-
operative; or
(b) to obtain supplies or services through or
30
from the co-operative; or
(c) to pay to the co-operative specified sums as
liquidated damages for any failure to comply
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with a requirement authorised by this
section.
(4) Any sum so required to be paid to the co-operative
as liquidated damages is for the purposes of
section 81 to be considered to be a debt due from
5
the member to the co-operative.
(5) A contract authorised by this section is binding on
the co-operative and all other parties even though
but for this Act the contract would be invalid as
being in restraint of trade.
10
(6) Rules authorised by this section are authorised
even though, but for this section, the rules might
be invalid as being in restraint of trade.
80. Fines payable by members
(1) A co-operative may impose a fine on a member
15
for any infringement of the rules of the co-
operative if the rules of the co-operative so
provide.
(2) A fine imposed under sub-section (1) must not
exceed the maximum fine fixed by the rules in
20
accordance with section 107.
(3) A fine must not be imposed unless--
(a) notice of intention to impose the fine and the
reason for it has been given to the member;
and
25
(b) the member has been given a reasonable
opportunity to appear before the board in
person (with or without witnesses), or to
send to the board a written statement, for the
purpose of showing cause why the fine
30
should not be imposed.
(4) The co-operative may set off the whole or any part
of the fine against any money due to the member
in respect of any produce delivered by the member
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to the co-operative, but no part of the fine is to be
set off against any advance due to the member
from the co-operative in accordance with the rules
against produce so delivered.
81. Charge and set-off of co-operative
5
(1) A co-operative has, in respect of any debt due
from a member or former member to the co-
operative, a charge on each of the following--
(a) the share or interest in the capital and the
credit balance and deposits of the member or
10
former member;
(b) any rebate, bonus, dividend or interest
payable to the member or former member;
(c) any entry fees and regular subscriptions
required to be repaid to a member when the
15
member ceases to be a member.
(2) The co-operative may set off any amount paid on
account of that share or other thing, or any amount
credited or payable to the member or former
member, in or towards payment of the debt.
20
(3) The charge created by this section may be
enforced by the appropriation by the co-operative
of the thing that is subject to the charge, but only
after at least 7 days notice has been given to the
member or former member.
25
(4) Any share in respect of which capital has been so
appropriated must be cancelled.
82. Repayment of shares on expulsion
(1) When a member is expelled from a co-operative in
accordance with its rules, the co-operative must
30
repay to the member the amount paid up on the
shares held by the member at the date of
expulsion, less any amount owed by the member
to the co-operative at the date of expulsion under
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84
Act No.
the rules of the co-operative or any contract or
otherwise.
(2) If the balance sheet of the co-operative last issued
before the expulsion of a member of the co-
operative disclosed a loss or deficiency, there must
5
be a proportionate reduction in the capital to be
repaid to the member.
(3) That reduction must be by an amount that bears to
the amount of the loss or deficiency so disclosed
the same proportion as the number of shares held
10
by the member bore to the total number of shares
held by all members of the co-operative as at the
date of expulsion of the member.
(4) Payment of any amount due to a member under
this section must be made at the time determined
15
by the board of the co-operative, but not later than
12 months after the date of expulsion.
(5) Shares in respect of which capital has been repaid
must be cancelled.
Division 3--Death of member
20
83. Meaning of "interest''
For the purposes of this Division, a deceased
member's "interest'' in a co-operative includes--
(a) the member's membership;
(b) any credit balance due to the member;
25
(c) any loan from or to or deposit with the co-
operative;
(d) any surplus arising on the sale by the co-
operative as mortgagee of any property
mortgaged by the deceased to the co-
30
operative.
84. Transfer of share or interest on death of member
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Subject to section 173, on the death of a member,
the board must transfer the deceased member's
share or interest in the co-operative to--
(a) the personal representative of the deceased
member; or
5
(b) to the person that the deceased's personal
representative specifies in an application
made to the co-operative within 3 months
after the death of the member.
85. Transfer of small shareholdings and interests on
10
death
(1) If the total value of a deceased member's shares or
interest in a co-operative is less than $10 000 (or
such other amount as may be prescribed), the
board may, on the basis of such evidence as it
15
considers sufficient, transfer the shares or interest
in accordance with whichever of the following
paragraphs is appropriate--
(a) if the member or person dies testate, to the
person who appears to the board to be
20
entitled to the shares or interest under the
will of the deceased member or person;
(b) if the member or person dies intestate, to any
person who appears to the board to be
entitled to obtain a grant of administration of
25
the estate of the deceased and that person
must then hold the shares or interest on the
same trusts as if he or she had obtained that
grant.
(2) A transfer must not be made under this section
30
after evidence has been produced to the co-
operative of the grant of letters of administration
of the estate, or probate of the will, of the
deceased member.
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(3) In this section, the "transfer'' of an interest
includes the payment of money.
86. Value of shares and interests
The value of the shares or interest of a deceased
member must be determined for the purposes of
5
this Division in accordance with the rules of the
co-operative.
87. Co-operative protected
Any transfer of property made by the board of a
co-operative in accordance with this Division is
10
valid and effectual against any demand made on
the co-operative by any other person.
Division 4--Disputes involving members
88. Grievance procedure
(1) The rules of a co-operative must set out a
15
grievance procedure for dealing with any dispute
under the rules between--
(a) a member and another member; or
(b) a member and the co-operative.
(2) A member may appoint any person to act on
20
behalf of the member in the grievance procedure.
(3) The grievance procedure must allow for natural
justice to be applied.
(4) In this section and section 89 "member" includes
any person who was a member not more than 6
25
months before the dispute occurred.
89. Application to Supreme Court
(1) The Supreme Court may, on the application of a
member or the co-operative, make an order
declaring and enforcing--
30
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(a) the rights or obligations of members of the
co-operative between themselves; or
(b) the rights or obligations of the co-operative
and any member between themselves.
(2) An order may be made under this section whether
5
or not a right of a proprietary nature is involved
and whether or not the applicant has an interest in
the property of the co-operative.
(3) The Supreme Court may refuse to make an order
on the application or may make an order for costs
10
against a party, whether successful or not, if it is
of the opinion that--
(a) the issue raised in the application is trivial;
or
(b) having regard to the importance of the issue,
15
the nature of the co-operative, any other
available method of resolving the issue, the
costs involved, lapse of time, acquiescence
or any other relevant circumstance, it was
unreasonable to make the application; or
20
(c) the unreasonable or improper conduct of a
party--
(i) has been responsible for the making of
the application; or
(ii) has added to the cost of the
25
proceedings.i
Division 5--Oppressive conduct of affairs
90. Interpretation
In this Division, a reference to a member of a co-
operative includes, in the case of a co-operative
30
that has a share capital, a reference to a person to
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whom a share in the co-operative has been
transmitted by will or by operation of law.
91. Application of Division
This Division does not apply in respect of
anything done under or for the purposes of Part 6.
5
92. Who may apply for court order?
The following persons may apply to the Supreme
Court for an order under this Division--
(a) the Registrar;
(b) a member who believes that the affairs of the
10
co-operative are being conducted in a
manner that is oppressive or unfairly
prejudicial to, or unfairly discriminatory
against, a member, or in a manner that is
contrary to the interests of the members as a
15
whole;
(c) a member who believes that an act or
omission, or a proposed act or omission, by
or on behalf of the co-operative, or a
resolution, or a proposed resolution, of a
20
class of members, was or would be
oppressive or unfairly prejudicial to, or
unfairly discriminatory against, a member or
was or would be contrary to the interests of
the members as a whole.
25
93. Orders that the Supreme Court may make
On application under this Division, the Supreme
Court may make any order that it thinks fit
including (without being limited to) one or more
of the following orders--
30
(a) an order that the Registrar appoint an
administrator of the co-operative;
(b) an order that the co-operative be wound up;
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(c) an order for regulating the conduct of affairs
of the co-operative in the future;
(d) an order for the repayment of the member's
shares in accordance with the provisions of
this Act for repayment of share capital;
5
(e) an order for the purchase of the shares of any
member by the co-operative and for the
reduction accordingly of the co-operative's
capital;
(f) an order directing the co-operative to
10
institute, prosecute, defend or discontinue
specified proceedings, or authorising a
member or members of the co-operative to
institute, prosecute, defend or discontinue
specified proceedings in the name and on
15
behalf of the co-operative;
(g) an order appointing a receiver or a receiver
and manager of property of the co-operative;
(h) an order restraining a person from engaging
in specified conduct or from doing a
20
specified act or thing;
(i) an order directing a co-operative to become
registered as a company under the
Corporations Law of Victoria;
(j) an order requiring a person to do a specified
25
act or thing;
(k) an order as to costs.
94. Basis on which Supreme Court makes orders
The Supreme Court may make an order under this
Division if it is of the opinion--
30
(a) that the affairs of a co-operative are being
conducted in a manner that is--
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(i) oppressive or unfairly prejudicial to, or
unfairly discriminatory against, a
member (the "oppressed member"),
whether or not in the capacity of a
member; or
5
(ii) contrary to the interests of the members
as a whole; or
(b) that an act or omission, or a proposed act or
omission, by or on behalf of a co-operative,
or a resolution, or a proposed resolution, of a
10
class of members of a co-operative, was or
would be--
(i) oppressive or unfairly prejudicial to, or
unfairly discriminatory against, a
member (the "oppressed member"),
15
whether or not in the capacity of a
member; or
(ii) contrary to the interests of the members
as a whole.
95. Winding up need not be ordered if oppressed members
20
prejudiced
The Supreme Court need not make an order under
this Division for the winding up of a co-operative
if it is of the opinion that the winding up of the co-
operative would unfairly prejudice an oppressed
25
member.
96. Application of winding up provisions
If an order that a co-operative be wound up is
made under this Division, the provisions of this
Act relating to the winding up of co-operatives
30
apply, with any changes that are necessary, as if
the order had been made or an application duly
filed in the Supreme Court by the co-operative.
97. Changes to rules
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If an order under this Division makes any
alteration to the rules of a co-operative--
(a) the alteration has effect as if it had been duly
made by special resolution of the co-
operative; and
5
(b) the co-operative must not (despite any other
provisions of this Act) without the leave of
the Supreme Court make any further
alteration to the rules inconsistent with the
provisions of the order.
10
98. Copy of order to be lodged with Registrar
An applicant for an order under this Division must
lodge an office copy of the order with the
Registrar within 14 days after it is made.
Penalty: 10 penalty units.
15
Division 6--Proceedings on behalf of a co-operative by
members and others
99. Bringing, or intervening in, proceedings on behalf of
a co-operative
(1) A person may bring proceedings on behalf of a co-
20
operative, or intervene in any proceedings to
which a co-operative is a party for the purpose of
taking responsibility on behalf of the co-operative
for those proceedings, or for a particular step in
those proceedings, (for example, compromising or
25
settling them), if--
(a) the person is--
(i) a member, former member, or person
entitled to be registered as a member, of
the co-operative or of a related body
30
corporate; or
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(ii) an officer or former officer of the co-
operative; or
(iii) the Registrar; and
(b) the person is acting with leave granted under
section 100.
5
(2) Proceedings brought on behalf of a co-operative
may be brought in the co-operative's name.
100. Applying for and granting leave
(1) A person referred to in section 99(1)(a) may apply
to the Supreme Court for leave to bring, or to
10
intervene in, proceedings.
(2) The Supreme Court may grant the application if it
is satisfied that--
(a) it is probable that the co-operative will not
itself bring the proceedings, or properly take
15
responsibility for them, or for the step in
them; and
(b) the applicant is acting in good faith; and
(c) it is in the best interests of the co-operative
that the applicant be granted leave; and
20
(d) if the applicant is applying for leave to bring
proceedings, there is a serious question to be
tried; and
(e) either--
(i) at least 14 days before making the
25
application, the applicant gave written
notice to the co-operative of the
intention to apply for leave and of the
reasons for applying; or
(ii) it is appropriate to grant leave even if
30
sub-paragraph (i) is not satisfied.
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101. Substitution of another person for the person granted
leave
(1) Any of the following persons may apply to the
Supreme Court for an order that they be
substituted for a person to whom leave has been
5
granted under section 100--
(a) a member, former member, or person entitled
to be registered as a member, of the co-
operative or a related body corporate; or
(b) an officer, or former officer, of the co-
10
operative; or
(c) the Registrar.
(2) The application may be made whether or not the
other person has already brought the proceedings
or made the intervention.
15
(3) The Supreme Court may make the order if it is
satisfied that--
(a) the applicant is acting in good faith; and
(b) in all the circumstances, it is appropriate to
make the order.
20
(4) An order substituting one person for another
person has the effect that--
(a) the grant of leave is taken to have been made
in favour of the substituted person; and
(b) if the other person has already brought the
25
proceedings or intervened, the substituted
person is taken to have brought those
proceedings or to have made that
intervention.
102. Effect of ratification by members
30
(1) A ratification or approval of conduct by members
of a co-operative--
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(a) does not prevent a person from bringing or
intervening in proceedings with leave under
section 100 or from applying for leave under
that section; and
(b) does not have the effect that proceedings
5
brought or intervened in with leave under
section 100 must be determined in favour of
the defendant, or that an application for leave
under that section must be refused.
(2) The Supreme Court may take into account a
10
ratification or an approval of the conduct by
members of a co-operative in deciding what order
or judgment (including as to damages) to make in
proceedings brought or intervened in with leave
under section 100 or in relation to an application
15
for leave under that section.
(3) In taking a ratification or approval into account
under sub-section (2), the Supreme Court may
have regard to--
(a) how well-informed about the conduct the
20
members were when deciding whether to
ratify or approve the conduct; and
(b) whether the members who ratified or
approved the conduct were acting for proper
purposes.
25
103. Leave to discontinue, compromise or settle
proceedings brought, or intervened in, with leave
Proceedings brought or intervened in with leave
must not be discontinued, compromised or settled
without the leave of the Supreme Court.
30
104. General powers of the Supreme Court
(1) The Supreme Court may make any orders, and
give any directions, that it thinks just in relation to
proceedings brought or intervened in with leave,
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or in relation to an application for leave,
including--
(a) interim orders; and
(b) directions about the conduct of the
proceedings, including requiring mediation;
5
and
(c) an order directing the co-operative, or an
officer of the co-operative, to do, or not to
do, any act; and
(d) an order appointing an independent person to
10
investigate, and report to the Supreme Court,
on--
(i) the financial affairs of the co-operative;
or
(ii) the facts or circumstances which gave
15
rise to that cause of action the subject
of the proceedings; or
(iii) the costs incurred in the proceedings
and the person granted leave.
(2) A person appointed by the Supreme Court under
20
sub-section (1)(d) is entitled, on giving reasonable
notice to the co-operative, to inspect and make
copies of any books of the co-operative for any
purpose connected with their appointment.
105. Power of Supreme Court to make costs order
25
At any time, the Supreme Court may, in relation to
proceedings brought or intervened in with leave
under section 100 or an application for leave
under that section, make any orders it thinks just
about the costs of the person who applied for or
30
was granted leave, of the co-operative or of any
other party to the proceedings or application,
including an order requiring indemnification for
costs.
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PART 5--RULES
106. Effect of rules
(1) The rules of a co-operative have the effect of a
contract under seal--
(a) between the co-operative and each member;
5
and
(b) between the co-operative and each director,
the principal executive officer and the
secretary of the co-operative; and
(c) between a member and each other member.
10
(2) Under the contract, each of those persons agrees to
observe and perform the provisions of the rules as
in force for the time being so far as those
provisions are applicable to that person.
107. Content of rules
15
(1) The rules of a co-operative must set out or
otherwise make provision for the matters specified
in Schedule 1.
(2) The rules must be divided into paragraphs
numbered consecutively.
20
(3) The rules may state the objects of the co-
operative.
(4) The rules may incorporate any provision of the
model rules approved under section 110.
(5) The rules may provide for the imposition of a fine
25
on a member for any infringement of the rules.
(6) If the rules provide for the imposition of a fine, the
rules must specify the maximum fine that may be
imposed on a member.
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(7) The maximum fine fixed by the rules must not
exceed any amount that may be prescribed as the
maximum fine.
(8) The rules may contain other provisions not
inconsistent with this Act or the regulations.
5
108. Purchase and inspection of copy of rules
(1) Any member is entitled to obtain from a co-
operative a copy of its rules on payment of the
amount required by the rules of the co-operative
or, if the rules do not prescribe an amount, on
10
payment of $5.
(2) The amount required by the rules must not exceed
the prescribed fee for obtaining a copy of the rules
from the Registrar.
(3) Any person is entitled to obtain from the Registrar
15
a copy of the rules of a co-operative on payment
of the prescribed fee.
109. False copies of rules
(1) A person who gives to a member of a co-operative
or to a person intending or applying to become a
20
member of a co-operative a copy of any rules or
any alterations of rules, other than those which
have been duly registered, representing that they
are binding on the members of the co-operative is
guilty of an offence and liable to a penalty not
25
exceeding 10 penalty units.
(2) A person who alters any of the rules of a co-
operative after they have been registered and
circulates them representing that they have been
duly registered when they have not been is guilty
30
of an offence and liable to a penalty not exceeding
10 penalty units.
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110. Model rules
(1) The Registrar may by notice published in the
Government Gazette approve model rules for co-
operatives or for any class of co-operatives and
alter or repeal the model rules from time to time.
5
(2) The model rules may make provision for anything
for which the rules of a co-operative may make
provision.
(3) If the model rules provide for a matter and the
rules of a co-operative of the class to which the
10
model rules apply do not provide for that matter,
the provision of the model rules relating to that
matter is deemed to be included in the rules of the
co-operative.
111. Rules can only be altered in accordance with this Act
15
The rules of a co-operative cannot be altered
except in accordance with this Act.
112. Approval of alteration of rules
(1) A proposed alteration of the rules must be
approved by the Registrar before the resolution
20
altering the rules is passed by a co-operative or the
board of a co-operative.
(2) A draft of the proposed alteration must be
submitted to the Registrar at least 28 days (or such
shorter period as the Registrar may allow in a
25
particular case) before--
(a) the notice of the proposed special resolution
altering the rules is given to the members by
the co-operative; or
(b) the resolution is passed by the board of the
30
co-operative.
(3) The proposed alteration must--
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(a) be in accordance with section 107; and
(b) be in a form that may reasonably be
approved; and
(c) be accompanied by a statement setting out
the reasons for the alteration.
5
(4) The Registrar may--
(a) approve the alteration as submitted; or
(b) approve a different alteration to that
submitted; or
(c) refuse to approve the alteration.
10
(5) The Registrar approves of the alteration by giving
written notice of the approval of the alteration to
the person who submitted the alteration to the
Registrar.
(6) The Registrar must give written notice of the
15
refusal to approve the alteration to the person who
submitted the alteration to the Registrar.
113. Alteration by special resolution
The rules of a co-operative must be altered by
special resolution unless otherwise specified in
20
this Act.
114. Alteration by resolution of board
(1) The rules of a co-operative may be altered by a
resolution passed by the board if the alteration
does no more than give effect to a requirement,
25
restriction or prohibition imposed by or under the
authority of this Act.
(2) If the rules of a co-operative are altered pursuant
to this section, the co-operative must cause the
alteration to be notified in writing to its members
30
as soon as practicable after the alteration takes
effect and in any event not later than the date on
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which notice is given to the members of the next
annual general meeting of the co-operative after
the alteration takes effect.
115. Alteration does not take effect until registered
(1) An alteration of the rules of a co-operative does
5
not take effect unless and until it is registered by
the Registrar.
(2) An application for registration of an alteration
must--
(a) be made in a form approved by the Registrar;
10
and
(b) be made within 28 days, or such other period
as may be prescribed, after the alteration is
made; and
(c) be accompanied by a consolidated copy of
15
the rules of the co-operative, including the
alteration.
(3) The Registrar must register the alteration unless--
(a) the Registrar is satisfied that the alteration is
contrary to this Act or the regulations; or
20
(b) the Registrar has other reasonable cause to
refuse to register the alteration.
(4) A certificate of registration of any alteration of the
rules of a co-operative given by the Registrar is, in
favour of any person advancing money to the co-
25
operative on the faith of the certificate or in favour
of any guarantor of that advance, conclusive
evidence that the alteration in the rules was duly
made.
116. Appeal against refusal to approve alteration
30
A co-operative may appeal to the Administrative
Appeals Tribunal against--
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(a) a decision of the Registrar to refuse to
approve an alteration of its rules; or
(b) a failure of the Registrar to approve an
alteration of its rules.
117. Appeal against refusal to register alteration
5
A co-operative may appeal to the Administrative
Appeals Tribunal against--
(a) a decision of the Registrar to refuse to
register an alteration of its rules; or
(b) a failure of the Registrar to register an
10
alteration of its rules.
118. Registrar to comply with Tribunal determination
The Registrar must comply with a determination
of the Administrative Appeals Tribunal on an
appeal under this Part.
15
_______________
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PART 6--ACTIVE MEMBERSHIP
Division 1--Definitions
119. Primary activity--meaning
A primary activity of a co-operative is an activity
specified in the rules of the co-operative as a
5
primary activity of the co-operative.
120. What is active membership?
For the purposes of this Act, a member of a co-
operative is an active member of the co-operative
if the member--
10
(a) utilises or supports an activity of, or
maintains a relationship or an arrangement
with, the co-operative, in connection with the
carrying on of a primary activity of the co-
operative, in the manner and to the extent
15
which the rules of the co-operative provide is
sufficient to establish active membership; or
(b) maintains any other relationship or
arrangement with the co-operative in
connection with the carrying on of a primary
20
activity of the co-operative that the
regulations provide is sufficient to establish
active membership.
121. What are active membership provisions and
resolutions?
25
(1) Active membership provisions in the rules of a co-
operative are provisions in the rules which
specify--
(a) which of the activities of the co-operative are
the primary activities of the co-operative;
30
and
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(b) the manner in which and the extent to which
a member of the co-operative is required to
utilise or support an activity of, or maintain a
relationship or an arrangement with, the co-
operative, in connection with the carrying on
5
of a primary activity of the co-operative, in
order to establish active membership of the
co-operative.
(2) An active membership resolution is a resolution
which would, if given effect to, make or amend
10
active membership provisions in the rules of a co-
operative.
Division 2--Rules to contain active membership provisions
122. Number of primary activities required
A co-operative must have at least 1 primary
15
activity.
123. Rules to contain active membership provisions
The board of a co-operative must ensure that the
rules of the co-operative contain active
membership provisions in accordance with this
20
Part.
124. Factors and considerations for determining primary
activities etc.
(1) The board of a co-operative must ensure that the
relevant factors and considerations are taken into
25
account in determining--
(a) which of the activities of a co-operative are
its primary activities;
(b) the manner and extent to which a member is
required to utilise or support an activity of,
30
or maintain a relationship or an arrangement
with, a co-operative, in connection with the
carrying on of a primary activity of the co-
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operative, in order to establish active
membership of the co-operative.
(2) The relevant factors and considerations are--
(a) the primary activity or (if more than one) the
primary activities taken together must
5
constitute the basic purpose for which the co-
operative exists and a significant
contribution to the business of the co-
operative;
(b) the manner and extent of required utilisation,
10
support, relationship or arrangement should
be reasonable when considered in relation to
the activities of the co-operative as a whole;
(c) any other factors and considerations that are
prescribed.
15
(3) The regulations may--
(a) provide for the matters to be taken into
account in determining whether an activity
makes or activities make a significant
contribution to the business of the co-
20
operative; and
(b) specify minimum percentages of turnover,
minimum amounts of income or minimum
amounts of business necessary to constitute
that significant contribution.
25
(4) Factors and considerations may be prescribed so
as to apply to co-operatives generally, to a
specified class of co-operatives or to a specified
individual co-operative.
(5) Nothing in this section limits the right of active
30
members other than the board of the co-operative
to propose an active membership resolution.
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125. Active membership provisions--trading co-operatives
The only active membership provisions which
may be contained in the rules of a trading co-
operative are--
(a) provisions requiring a member to utilise an
5
activity of the co-operative in connection
with the carrying on of a primary activity
specified in the provisions to establish active
membership; and
(b) any other active membership provisions that
10
the Registrar may approve.
126. Regular subscription--active membership of non-
trading co-operative
(1) Active membership provisions for a non-trading
co-operative may include provision that the
15
payment of a regular subscription by a member of
the co-operative, to be applied in connection with
a primary activity of the co-operative, is sufficient
to establish active membership of the co-
operative.
20
(2) A member of a co-operative who would, on
payment of such a subscription, be an active
member of a co-operative is to be considered to be
an active member until the subscription is due and
payable.
25
Division 3--Active membership resolutions
127. Notice of meeting
(1) At least 21 days notice must be given to members
of a co-operative of a meeting at which an active
membership resolution is to be proposed.
30
(2) The notice must, in addition to the other matters
required to be specified--
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(a) specify whether the member is eligible to
vote on the resolution; and
(b) specify the full text of the proposed
resolution; and
(c) contain a copy of section 131.
5
(3) If the notice to a member states that he or she is
not eligible to vote on a resolution, the member
may, after endeavouring to settle the matter with
the co-operative, apply to the Registrar for a
determination as to the member's eligibility.
10
(4) The Registrar may determine the matter, on the
information available to the Registrar, by direction
in writing to the co-operative and the member.
(5) The Registrar's determination as to eligibility has
effect but only if given before the meeting
15
concerned is due to be held.
128. Eligibility to vote on active membership resolution.
The only members of a co-operative who are
eligible to vote on an active membership
resolution when the rules do not contain active
20
membership provisions are those members who
would be active members if the resolution had
already taken effect.
129. Eligibility of directors to vote on proposal at board
meeting
25
If the board of a co-operative is meeting to
consider a proposal to submit an active
membership resolution to a meeting of the co-
operative--
(a) subject to paragraph (b), a director is only
30
eligible to vote on that proposal if he or she
would be eligible to vote on the resolution at
the meeting of the co-operative; or
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(b) if less than 2 directors (whether or not they
are present at the meeting of the board of
directors) would be eligible to vote on the
resolution at the meeting of the co-operative,
all the directors are eligible to vote on that
5
proposal at the meeting of the board of
directors.
130. Other entitlements of members not affected
A provision of this Division which renders a
member of a co-operative ineligible to vote on a
10
resolution does not affect any other right,
entitlement, obligation or duty of the member as a
member.
Division 4--Cancellation of membership of inactive
members
15
131. Cancellation of membership of inactive member
(1) The board of a co-operative must declare the
membership of a member cancelled if--
(a) the whereabouts of the member are not
presently known to the co-operative and have
20
not been known to the co-operative for at
least the required period before that time; or
(b) the member is not presently an active
member of the co-operative and has not been
an active member of the co-operative at any
25
time during the required period immediately
before that time.
(2) This section applies to a member only if he or she
was a member of the co-operative throughout the
required period.
30
(3) The question of whether a member was an active
member at a particular time in the past is to be
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determined as if the active membership provisions
concerned had been in force at that time.
(4) The board's declaration under this section has the
effect of cancelling the membership concerned.
(5) A person may apply to the Supreme Court for an
5
order under section 137 in respect of the
cancellation of the person's membership under this
section.
(6) In this section "the required period" in relation
to a co-operative, means--
10
(a) 3 years; or
(b) if a shorter period is provided for in the rules
of the co-operative, that shorter period.
132. Share to be forfeited if membership cancelled
(1) If a co-operative has a share capital, the board of
15
the co-operative must declare the shares of a
member to be forfeited at the same time as the
member's membership is cancelled under section
131.
(2) The board's declaration has the effect of forfeiting
20
the shares concerned.
(3) Nothing in this section affects the operation of
section 138.
133. Failure to cancel membership--offence by director
If the board of a co-operative fails to cancel the
25
membership of a member as required by this Part,
a director of the co-operative who did not use all
due diligence to prevent that failure is guilty of an
offence and liable to a penalty not exceeding 20
penalty units.
30
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134. Deferral of forfeiture by board
(1) The board of a co-operative may by resolution
defer cancellation of a member's membership for a
period of up to 12 months--
(a) if the board has reasonable grounds to
5
believe that a member has ceased to be an
active member due to unusual circumstances
which prevent the member fulfilling his or
her active membership obligations; or
(b) if--
10
(i) the board thinks that during that period
an active membership resolution may
be put to the members of the co-
operative; and
(ii) the effect of the resolution would be
15
relevant to the question of whether the
member is an active member.
(2) The board of the co-operative must review the
resolution to defer before the end of the deferral
period to determine if a further resolution should
20
be made under sub-section (1).
135. Cancellation of membership prohibited in certain
circumstances
Unless the regulations otherwise provide, the
board of a co-operative must not declare the
25
membership of a member to be cancelled under
this Part--
(a) if the co-operative is insolvent; or
(b) if the co-operative is under administration
under Part 5.3A of the Corporations Law as
30
adopted and applying under this Act; or
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(c) if a compromise or an arrangement is being
administered in respect of the co-operative;
or
(d) if the co-operative is in the course of being
wound-up; or
5
(e) if an appointment of a receiver (whether or
not a receiver and manager) of any property
of the co-operative is in force; or
(f) if the co-operative has, for the purposes of
being registered as a company under the
10
Corporations Law, filed with the Registrar a
copy of the entry made in the minute book of
the co-operative under section 199; or
(g) in such other circumstances as may be
prescribed.
15
136. Notice of intention to cancel membership
(1) The board of a co-operative must ensure that not
less than 28 days notice of its intention to declare
the membership of a member to be cancelled is
given to the member.
20
(2) Notice is not required to be given under this
section if--
(a) the member's whereabouts are unknown to
the co-operative; and
(b) the amount required to be repaid to the
25
member in respect of the cancelled
membership (whether by reason of the
cancellation of shares or otherwise) does not
exceed $50.
137. Order of Supreme Court against cancellation
30
(1) If the Supreme Court is satisfied in a particular
case that the cancellation of a member's
membership under section 131 was or would be
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unreasonable, the Supreme Court may by order
direct that the membership should not have been
cancelled or should not be cancelled.
(2) While an order is in force under this section--
(a) the membership concerned is not required to
5
be cancelled and any shareholding of the
member is not required to be forfeited; and
(b) the person whose membership was cancelled
is entitled to be reinstated as a member of the
co-operative with all the rights and
10
entitlements (including any shareholding)
attaching to or arising from the former
membership.
(3) Reinstatement of a member under this section is to
be effected in accordance with the directions of
15
the Supreme Court.
138. Repayment of amounts due in respect of cancelled
membership
(1) If the membership of a member of a co-operative
is cancelled under this Part, the co-operative must,
20
within 12 months after the date of cancellation--
(a) repay to the former member the amount due
to the member in respect of that cancellation;
or
(b) apply that amount in accordance with sub-
25
section (2) if--
(i) the board is of the opinion that
repayment would adversely affect the
financial position of the co-operative;
or
30
(ii) the board and the former member so
agree.
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(2) The amount due may be applied as follows--
(a) if the co-operative is a deposit-taking co-
operative, the co-operative may apply the
amount as a deposit by the former member
with the co-operative (subject to the
5
requirements of section 139 as to interest on
the deposit);
(b) the co-operative may allot or issue
debentures of the co-operative to the former
member in satisfaction of the amount;
10
(c) the co-operative may appropriate the amount
due as a donation to the co-operative, but
only if the former member consents in
writing to the donation.
(3) The amount due to a former member in respect of
15
the cancellation of membership includes any
amount paid up in respect of shares forfeited as a
result of the cancellation of membership.
(4) If the former member is subsequently readmitted
to membership, any amount held by the co-
20
operative under this section must, if the member
so requests, be applied towards the cost of
admission to membership (including any
subscription for share capital).
139. Interest on deposits and debentures
25
(1) This section applies when the amount due to a
former member under section 138 is applied as a
deposit with the co-operative or the co-operative
allots or issues debentures to the former member
in satisfaction of the amount.
30
(2) The deposit or debenture bears interest during any
period--
(a) in the case of a co-operative with share
capital--
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(i) at the rate (or, if there is more than one
rate, at the higher or highest rate) of
dividend payable in respect of that
period on the share capital of the co-
operative; or
5
(ii) if the rate of dividend payable in respect
of that period has not been determined,
at the rate (or the higher or highest rate)
payable in respect of the immediately
preceding period for which a rate has
10
been determined; or
(iii) if a rate of dividend has never been
determined in respect of the share
capital of the co-operative, at the rate
that the board of the co-operative
15
considers reasonable; or
(b) in the case of a co-operative without share
capital, at the rate that the board of the co-
operative considers reasonable; or
(c) if the rules provide for a rate to be payable
20
that is higher than the rate applicable under
paragraph (a) or (b), at that higher rate.
(3) A former member may agree to the rate of interest
being less than that which would otherwise be
payable under this section and may agree to no
25
interest being paid.
(4) The provisions of Part 7.12 of the Corporations
Law adopted under section 263 of this Act do not
apply to an allotment or issue of debentures under
this section.
30
140. Repayment of deposits and debentures
(1) A deposit or debenture to which an amount due to
a former member is transferred under this Division
is to be repaid to the former member as soon as
repayment would not, in the opinion of the board,
35
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adversely affect the financial position of the co-
operative.
(2) The deposit or debenture must in any case be
repaid within 10 years (or within any shorter
period that the rules of the co-operative may
5
require) after cancellation of the member's
membership.
141. Register of cancelled memberships
A co-operative must keep a register, in a form
approved by the Registrar, specifying the
10
prescribed particulars of persons whose
membership has been cancelled under this Part.
Division 5--Entitlements of former members of trading
co-operatives
142. Application of Division
15
This Division only applies to trading co-
operatives.
143. Former shareholders to be regarded as shareholders
for certain purposes
(1) Even though a person's shares in a co-operative
20
have been forfeited under this Part, the person is
to be regarded as the holder of shares in the co-
operative (the same in all respects as those that
were forfeited) for the following purposes--
(a) the entitlements of a shareholder in respect
25
of the purchase of shares in the co-operative
pursuant to an offer described in section
290(1)(a), (b) or (c) or the purchase of all the
shares in the co-operative, if the offer or
purchase occurs within 5 years after the
30
person's shares were forfeited;
(b) the entitlement of a shareholder when the co-
operative becomes registered as a company if
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the relevant special resolution under section
307 is passed within 5 years after the
person's shares were forfeited;
(c) the entitlement of a shareholder to a
distribution of surplus in a winding-up of the
5
co-operative that commences within 5 years
after the person's shares were forfeited.
(2) Sub-section (1)(a) does not apply in respect of--
(a) an offer described in section 290(1)(a) or (c)
that is made by another co-operative; or
10
(b) the purchase of all the shares in the co-
operative by another co-operative.
(3) Sub-section (1)(c) does not apply if the
winding-up is for the purposes of an merger under
Division 1 of Part 12.
15
(4) For the removal of doubt, it is declared that the
entitlement under sub-section (1)(a) of a person
whose shares have been forfeited does not include
an entitlement to vote on any matter.
(5) This section does not apply to a forfeited
20
shareholding in a co-operative if section 144
operates to require that forfeited shareholding to
be regarded as a forfeited shareholding in another
co-operative.
144. Entitlements of former shareholders on mergers etc.
25
(1) This section applies when a person's shares in a
co-operative ("the original co-operative'') are
forfeited under this Part and within 5 years after
that forfeiture--
(a) the original co-operative becomes a
30
subsidiary of another co-operative ("the new
co-operative''); or
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(b) another co-operative ("the new co-
operative'') is created as a result of a merger
under Division 1 of Part 12 involving the
original co-operative; or
(c) the engagements of the original co-operative
5
are transferred to another co-operative ("the
new co-operative'') under Division 1 of
Part 12.
(2) A person referred to in sub-section (1) is, for the
purposes of the operation of section 143 (and the
10
further operation of this section) to be regarded as
having held shares in the new co-operative and as
having had those shares in the new co-operative
forfeited under this Part when the person's shares
in the original co-operative were forfeited.
15
(3) The extent of the forfeited shareholding in the new
co-operative is determined as follows--
(a) if the entitlement of active members of the
original co-operative in the circumstances
concerned is solely an entitlement to be
20
allotted shares in the new co-operative, the
forfeited shareholding in the new co-
operative is the shareholding to which the
person would have been entitled had the
person's shares in the original co-operative
25
not been forfeited;
(b) in any other case, the forfeited shareholding
in the new co-operative is the shareholding
that is the same in all respects as the forfeited
shareholding in the original co-operative.
30
(4) The determination under sub-section (3)(a) of the
person's shareholding in the new co-operative
must be made--
(a) solely on the basis of the person's
shareholding in the original co-operative
35
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when the shares were forfeited or (in a
further operation of this section in respect of
the person) when the person was first to be
regarded as having a forfeited shareholding
in the original co-operative; and
5
(b) without regard to any additional shareholding
in the original co-operative to which the
person would have become entitled had the
shares not been forfeited (whether as a result
of any bonus share issue or otherwise).
10
145. Set-off of amounts repaid etc. on forfeited shares
(1) If a person has an entitlement because of the
operation of section 144, the entitlement operates
to extinguish any liability of the co-operative--
(a) to repay to the person under section 138 any
15
amount in respect of the forfeited shares
concerned; or
(b) in respect of a deposit held by the co-
operative, or debentures allotted or issued to
the person, under section 138 in respect of
20
the forfeited shares concerned (except a
liability to pay interest that is due but
unpaid).
(2) If an amount has been repaid to a person under
section 138 or 140, the amount repaid is to be
25
set-off against any entitlement of the person under
section 143 in respect of the forfeited shares
concerned.
(3) If the amount repaid cannot be set-off against the
entitlement because the entitlement is not, or is
30
only partly, an entitlement to money, the
entitlement is lost unless the person pays to the co-
operative the amount repaid to the person and
does so within the period required under sub-
section (4).
35
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(4) If the circumstances specified in sub-section (3)
arise, the co-operative concerned must--
(a) give written notice of the matter by post to
the person concerned at the person's address
last known to the co-operative, specifying a
5
period of not less than 28 days after the
notice is given during which any amount
repaid must be paid to the co-operative; and
(b) publish a general notice to that effect in a
newspaper circulating generally in the
10
district in which the registered office of the
co-operative is situated.
146. Entitlement to distribution from reserves
A person whose membership of a co-operative has
been cancelled under this Part is to be considered
15
to still be a member for the purposes of any
distribution from reserves of the co-operative that
takes place within 5 years after the person's
membership was cancelled.
147. Registrar may exempt co-operatives from provisions
20
The Registrar may, by order, exempt a specified
co-operative or a co-operative that is a member of
a specified class of co-operatives from all or
specified provisions of this Division.
_______________
25
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PART 7--SHARES
Division 1--Nature of share
148. Nature of share in co-operative
(1) A share or other interest in a co-operative--
(a) is personal property;
5
(b) is transferable or transmissible as provided
by this Act and the rules of the co-operative;
(c) is, subject to the rules of the co-operative,
capable of devolution by will or by operation
of law.
10
(2) Subject to sub-section (1)--
(a) the laws applicable to ownership of and
dealing with personal property apply to a
share or other interest of a member in a co-
operative as they apply to other property; and
15
(b) equitable interests in respect of a share or
other interest of a member in a co-operative
may be created, dealt with and enforced as in
the case of other personal property.
Division 2--Disclosure
20
149. Disclosure to members
(1) In addition to any information required under Part
4 to be provided, the board of a trading co-
operative must provide a member of the co-
operative with a disclosure statement before
25
shares are issued to the member.
(2) The disclosure statement must contain--
(a) a statement of the rights and liabilities
attaching to shares; and
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(b) a copy of the last annual report of the co-
operative under section 249; and
(c) any other relevant information concerning
the financial position and prospects of the
co-operative if there has been a significant
5
change since the date of the last annual
report; and
(d) any other information that the Registrar
directs.
Division 3--Issue of shares
10
150. Shares--general
(1) The share capital of a co-operative varies in
amount according to the nominal value of shares
from time to time subscribed.
(2) Shares are to be of a fixed amount which is to be
15
specified in the rules of the co-operative.
(3) A co-operative may have more than one class of
shares provided the shareholding and the rights of
shareholders comply with the co-operative
principles.
20
(4) Subject to this Part and Part 4, shares must not be
issued to a non-member.
151. Minimum paid up amount
(1) A share must not be allotted unless at least 10% of
the nominal value of the share has been paid.
25
(2) Any balance unpaid in respect of shares at the
time of allotment must be paid in a manner
specified in the rules or permitted by this Act.
(3) This section does not apply to a bonus share
issued under section 156 or 273.
30
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152. Shares not to be issued at a discount
A co-operative must not issue shares at a discount.
153. Issue of shares at a premium
(1) A trading co-operative may issue shares at a
premium.
5
(2) A premium may be in the form of cash or other
valuable consideration.
(3) If a trading co-operative issues shares for which it
receives a premium, a sum equal to the aggregate
amount or value of the premiums on those shares
10
must be transferred to a share premium account.
(4) The share premium account is to be regarded as
paid up share capital of the trading co-operative
and may be applied in any one or more of the
following ways--
15
(a) in paying up unissued shares to be issued to
members of the co-operative as fully paid
bonus shares;
(b) in paying up in whole or in part the balance
unpaid on shares previously issued to
20
members of the co-operative;
(c) in the payment of dividends, if those
dividends are satisfied by the issue of shares
to members of the co-operative;
(d) in writing off the preliminary expenses of the
25
co-operative;
(e) in providing for the premium payable on
redemption of shares or debentures.
154. Joint ownership of shares
A share may be held by 2 or more persons jointly,
30
unless the rules of the co-operative provide
otherwise.
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155. Members may be required to take up additional shares
(1) If authorised by the rules of the co-operative, the
board of a trading co-operative may require a
member to take up or subscribe for additional
shares in accordance with a proposal approved by
5
a special resolution of the co-operative.
(2) The board of a trading co-operative may deduct
amounts in payment for additional shares from
money due to members in respect of dealings with
the co-operative, in accordance with a proposal
10
approved by a special resolution of the co-
operative.
(3) Any proposal to require a member to take up or
subscribe for additional shares must--
(a) be accompanied by a disclosure statement,
15
approved by the Registrar, that explains the
purpose for which the funds raised by the
issue of the additional shares are to be used;
and
(b) clearly show the total number of additional
20
shares to be issued and the basis on which
the shares are to be apportioned amongst
members; and
(c) be accompanied by a statement informing the
member that the member may inform the
25
board by notice on or before the date
specified in the statement (being a date
before the passing of the special resolution)
that the member resigns on the passing of the
special resolution.
30
(4) Any proposal to deduct amounts in payment for
additional shares from money due to members in
respect of their dealings with the trading co-
operative must clearly show--
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(a) the basis on which the deductions are to be
made; and
(b) the time and manner of making those
deductions.
(5) A proposal approved under this section is binding
5
on--
(a) all members of the trading co-operative at
the date of the passing of the special
resolution other than a member who has
given a notice of resignation in accordance
10
with sub-section (3)(c); and
(b) all persons who become members of the
trading co-operative after that date and
before the total number of shares to be issued
pursuant to the proposal has been issued.
15
(6) Sections 17 (except sub-section (2)) and 29 apply
to the approval of a disclosure statement under
this section with any necessary modifications and
in particular as if any reference in section 17 to a
formation meeting were a reference to the special
20
resolution.
156. Bonus share issues
(1) In addition to section 273, the rules of a trading
co-operative may authorise the issue of bonus
shares to members of the co-operative if the assets
25
of the co-operative--
(a) have been sold at a profit; or
(b) have been re-valued at a greater value than
that disclosed prior to the revaluation in the
books of the co-operative.
30
(2) This section does not apply if the assets were
acquired for resale at a profit.
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157. Restrictions on bonus shares
Bonus shares under section 156 may be issued in
accordance with the rules of the co-operative,
subject to the following restrictions--
(a) each issue must have been approved by a
5
special resolution of the co-operative;
(b) they are to be issued as fully paid up shares
with no payment required to be made by a
member of the co-operative to whom they
are issued;
10
(c) they are to be issued only in respect of shares
of the same class of shares that are fully paid
up as at the date of issue of the bonus shares;
(d) the total nominal value of bonus shares
issued by a co-operative during any 12
15
month period must not exceed 20% or such
other percentage as may be prescribed of the
nominal value of the issued share capital of
the co-operative immediately before the date
of issue of the bonus shares.
20
158. Notice in respect of bonus shares
Notice of the meeting or postal ballot at which a
resolution is to be proposed as a special resolution
for the purpose of approving a bonus share issue
must be accompanied by--
25
(a) a statement of the value of the assets
concerned as disclosed in the books of the
co-operative before the sale or revaluation;
and
(b) if the issue arises from, or partly from, a sale
30
of assets, a statement of the price for which
the assets were sold; and
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(c) if the issue arises from, or partly from, a
revaluation of assets, a certificate of value of
the assets, being a certificate furnished in
respect of a valuation made not more than 12
months before the date of the notice by a
5
prescribed person or a person having
prescribed qualifications; and
(d) particulars of acquisitions of shares in the co-
operative made during the 3 years
immediately preceding the date of the notice
10
by or on behalf of each of its directors and
his or her spouse and the father, mother,
children, brothers and sisters of each such
director and spouse; and
(e) a certificate signed by 2 directors of the co-
15
operative stating that to the best of their
knowledge and belief the issue of bonus
shares would not be imprudent and that no
circumstances are known to them as to why
the issue should not take place.
20
Division 4--Beneficial and non-beneficial interest in shares
159. Notice of non-beneficial ownership at time of transfer
(1) If it may reasonably be expected (having regard to
all relevant circumstances) that on registration of a
transfer of shares the transferee will hold some or
25
all of the shares non-beneficially, the instrument
of transfer must include a non-beneficial
ownership notice.
(2) A non-beneficial ownership notice is a notice
that--
30
(a) contains a statement to the effect that, on
registration of the transfer, the transferee will
hold particular shares non-beneficially; and
(b) sets out particulars of those shares; and
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(c) is signed by or on behalf of the transferee.
(3) A transferee must ensure that this section is
complied with when an instrument of transfer of
shares is lodged by or on behalf of the transferee
with the co-operative for registration of the
5
transfer.
Penalty: 10 penalty units or imprisonment for
3 months, or both.
(4) An offence under this section does not affect the
validity of the registration of a transfer of shares.
10
160. Notice of non-beneficial ownership not notified at
time of transfer
(1) If on the registration of an instrument of transfer
of shares the transferee holds non-beneficially any
of the shares transferred, notice of that fact must
15
be given to the co-operative.
(2) The notice must--
(a) set out the name and address of the
transferee; and
(b) contain a statement to the effect that, as from
20
registration of the transfer, the transferee
holds the shares non-beneficially; and
(c) set out particulars of those shares; and
(d) be signed by or on behalf of the transferee.
(3) The notice must be given within 14 days after the
25
registration of the transfer (even if before the end
of that 14 days the transferee begins to hold any of
the relevant shares beneficially).
(4) The transferee of the shares must ensure that this
section is complied with.
30
Penalty: 10 penalty units or imprisonment for
3 months, or both.
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(5) This section does not apply in respect of any
shares for which particulars were set out in a
non-beneficial ownership notice under section 159
included in the instrument of transfer.
161. Registration as beneficial owner of shares notified as
5
non-beneficially transferred
(1) If an instrument of transfer of shares lodged with a
co-operative includes a non-beneficial ownership
notice under section 159 in respect of particular
shares but on registration of the transfer the
10
transferee holds some or all of those shares
beneficially, notice of that fact must be given to
the co-operative.
(2) The notice must--
(a) set out the name and address of the
15
transferee; and
(b) contain a statement to the effect that, as from
registration of the transfer, the transferee
holds the relevant shares beneficially; and
(c) set out particulars of the shares held
20
beneficially; and
(d) be signed by or on behalf of the transferee.
(3) The notice must be given within 14 days after the
registration of the transfer (even if before the end
of that 14 days the transferee begins to hold any of
25
the relevant shares non-beneficially).
(4) The transferee of the shares must ensure that this
section is complied with.
Penalty: 10 penalty units or imprisonment for
3 months, or both.
30
162. Notification of change in nature of shareholding
(1) A person must notify the co-operative in
accordance with this section of the change in the
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person's shareholding in the co-operative if the
person--
(a) commences to hold any shares beneficially
that the person currently holds
non-beneficially; or
5
(b) commences to hold any shares
non-beneficially that the person currently
holds beneficially.
Penalty: 10 penalty units or imprisonment for
3 months, or both.
10
(2) The notice must--
(a) set out the name and address of the person;
and
(b) contain a statement to the effect that, as from
the time of the change, the person holds the
15
shares beneficially or non-beneficially (as
appropriate); and
(c) specify the time of the change and set out
particulars of the shares affected; and
(d) be signed by or on behalf of the person.
20
(3) The notice must be given within 14 days after the
change (even if before the end of that 14 days
another such change affecting any of the shares
occurs).
163. Presumption of awareness
25
(1) For the purposes of this Division, a person is,
unless the contrary is established, to be presumed
to have been aware at a particular time of a
circumstance of which an employee or agent of
the person was aware at that time.
30
(2) Sub-section (1) only applies if the employee or
agent has duties or acts in relation to the transfer
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to, or ownership by, the person of a share or shares
in the co-operative concerned.
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164. Presumption that shares held non-beneficially
(1) A person is deemed to hold particular shares
non-beneficially if the person--
(a) holds the shares in a capacity other than that
of sole beneficial owner; or
5
(b) without limiting paragraph (a), holds the
shares as trustee for, as nominee for, or
otherwise on behalf of or on account of,
another person.
(2) A person is deemed to hold shares beneficially at a
10
particular time unless the person holds the shares
non-beneficially at that time.
165. Noting of beneficial and non-beneficial interests in
register of members
(1) The register of members kept by a co-operative
15
must contain a statement of the shares that each
member holds beneficially and of the shares that
each member holds non-beneficially.
(2) In determining for the purposes of an entry in the
register whether a member of a co-operative holds
20
shares beneficially or non-beneficially, regard is to
be had only to the following information--
(a) information contained in a non-beneficial
ownership notice under section 160 included
in an instrument of transfer registered by the
25
co-operative;
(b) information contained in a notice given to
the co-operative under any other provision of
this Division.
166. Registration as trustee etc. on death of owner of
30
shares
(1) A trustee, executor or administrator of the estate
of a dead person who was the registered holder of
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a share in a co-operative may be registered as the
holder of that share as trustee, executor or
administrator of that estate.
(2) A trustee, executor or administrator of the estate
of a dead person who was entitled in equity to a
5
share in a co-operative may, with the consent of
the co-operative and of the registered holder of
that share, be registered as the holder of that share
as trustee, executor or administrator of that estate.
167. Registration as administrator of estate on incapacity
10
of shareholder
(1) This section applies to a person ("the appointed
person'') who is appointed under a law of a State
or Territory relating to the administration of the
estates of persons who, through mental or physical
15
infirmity, are incapable of managing their affairs,
to administer the estate of another person ("the
incapable person'').
(2) If the incapable person is the registered holder of a
share in a co-operative, the appointed person may
20
be registered as the holder of that share as
administrator of the estate of the incapable person.
(3) If the incapable person is entitled in equity to a
share in a co-operative, the appointed person may,
with the consent of the co-operative and of the
25
registered holder of that share, be registered as the
holder of the share as administrator of the estate of
the incapable person.
168. Registration as Official Trustee in Bankruptcy
(1) This section applies when a share in a co-
30
operative that is the property of a bankrupt vests
by force of the Bankruptcy Act 1966 of the
Commonwealth in the Official Trustee in
Bankruptcy.
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(2) If the bankrupt is the registered holder of the
share, the Official Trustee may be registered as the
holder of that share as the Official Trustee in
Bankruptcy.
(3) If the bankrupt is entitled in equity to the share,
5
the Official Trustee may, with the consent of the
co-operative and of the registered holder of the
share, be registered as the holder of that share as
the Official Trustee in Bankruptcy.
169. Liabilities of person registered as trustee or
10
administrator
(1) A person registered under section 166, 167 or 168
is, while so registered, subject to the same
liabilities in respect of the share as those to which
the person would have been subject if the share
15
had remained, or had been, registered in the name
of the dead person, the incapable person or the
bankrupt.
(2) The person registered is subject to no other
liabilities in respect of the share.
20
170. Notice of trusts in register of members
Shares held by a trustee in respect of a particular
trust may, with the consent of the co-operative, be
marked in the register of members in such a way
as to identify the shares as being held in respect of
25
the trust.
171. No notice of trust except as provided by this Division
Except as provided in this Division--
(a) no notice of a trust, whether express, implied
or constructive, is to be entered on a register
30
or be receivable by the Registrar; and
(b) no liabilities are affected by anything done
under this Division; and
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(c) nothing done under this Division affects a
co-operative with notice of a trust.
Division 5--Sale or transfer of shares
172. Sale or transfer of shares
(1) A share in a co-operative cannot be sold or
5
transferred except--
(a) in accordance with Division 3 of Part 4 and
section 173, on the death of a member; or
(b) to a person appointed to administer the estate
of a shareholder under a law relating to the
10
administration of the estates of persons who,
through mental or physical infirmity, are
incapable of managing their affairs; or
(c) with the consent of the board, to any person
if there are reasonable grounds for believing
15
that the person will be an active member of
the co-operative.
(2) A share in a co-operative cannot be sold or
transferred except in accordance with the rules of
the co-operative.
20
173. Transfer on death of member
(1) On the death of a member, the member's share in
the co-operative cannot be transferred to a person
other than an administrator or executor except
with the consent of the board of the co-operative.
25
(2) The board may only give its consent under sub-
section (1) if there are reasonable grounds for
believing that the person will be an active member
of the co-operative.
174. Restriction on total shareholding
30
The board of a co-operative must not consent
under section 172 or 173 to the sale or transfer of
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a share if as a result of the sale or transfer the
nominal value of the shares held by the purchaser
or transferee would exceed--
(a) 20% of the nominal value of the share capital
of the co-operative; or
5
(b) if a lower percentage is specified in the rules
of the co-operative, that lower percentage of
the nominal value of the share capital of the
co-operative.
175. Transfer not effective until registered
10
A transferor of a share remains the holder of the
share until the transfer is registered and the name
of the transferee is entered in the register of
members in respect of the share.
Division 6--Repurchase of shares
15
176. Purchase and repayment of shares
(1) The rules of a co-operative may authorise the co-
operative to--
(a) purchase any share of a member in the co-
operative at the request of the member; and
20
(b) repay to a member, with the member's
consent, the whole or any part of the amount
paid up on any share held by the member
when the sum repaid is not required for the
activities of the co-operative.
25
(2) The amount paid by a co-operative under this
section in purchasing shares or repaying any
amount paid up on shares, or both, in any financial
year of the co-operative must not exceed the sum
of--
30
(a) 5% of the nominal value of the issued share
capital of the co-operative immediately
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before the commencement of that financial
year; and
(b) the amount of any additional share capital of
the co-operative subscribed for during that
year.
5
(3) The members of a co-operative may by special
resolution exempt a co-operative from the
operation of sub-section (2) in respect of a
particular financial year, either unconditionally or
subject to conditions.
10
(4) The amount paid for a share when it is
repurchased may be an amount determined by the
board that is less than the nominal value of the
share but only--
(a) if the books of the co-operative disclose that
15
the amount paid is the net shareholder's
equity per share in the undertaking of the co-
operative; or
(b) in accordance with the rules of the co-
operative.
20
(5) This section does not apply if the member has
resigned or has been expelled from the co-
operative or the member's membership has been
otherwise cancelled.
177. Deposit or debentures in lieu of payment when share
25
repurchased
(1) If a co-operative repurchases a share of a member,
the co-operative may instead of paying the
purchase price to the member--
(a) in the case of a deposit-taking co-operative,
30
apply the amount as an interest bearing
deposit by the member with the co-operative;
or
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(b) allot or issue debentures of the co-operative
to the member in satisfaction of the amount.
(2) Sub-section (1) applies only--
(a) if the board is of the opinion that payment of
the repurchase price would adversely affect
5
the financial position of the co-operative; or
(b) if the board and the member so agree.
(3) The deposit or debenture bears interest during any
period--
(a) in the case of a co-operative with share
10
capital--
(i) at the rate (or, if there is more than one
rate, at the higher or highest rate) of
dividend payable in respect of that
period on the share capital of the co-
15
operative; or
(ii) if the rate of dividend payable in respect
of that period has not been determined,
at the rate (or the higher or highest rate)
payable in respect of the immediately
20
preceding period for which a rate has
been determined; or
(iii) if a rate of dividend has never been
determined in respect of the share
capital of the co-operative, at the rate
25
that the board of the co-operative
considers reasonable; or
(b) in the case of a co-operative without share
capital, at the rate that the board of the co-
operative considers reasonable; or
30
(c) if the rules provide for a rate to be payable
that is higher than the rate applicable under
paragraph (a) or (b), at that higher rate.
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(4) The deposit or debenture must be repaid to the
member as soon as repayment would not, in the
opinion of the board, adversely affect the financial
position of the co-operative.
(5) The deposit or debenture must in any case be
5
repaid within 10 years (or within any shorter
period that the rules of the co-operative may
require) after the repurchase of the shares
concerned.
178. Cancellation of shares
10
A co-operative must cancel any share purchased
by or forfeited to the co-operative in accordance
with this Act or the rules of the co-operative.
_______________
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PART 8--VOTING
Division 1--Voting entitlements
179. Application of Part
This Part applies to all voting whether at meetings
or in ballots (including postal ballots).
5
180. Voting
(1) The right to vote attaches to membership and not
shareholding.
(2) Except as provided in sub-sections (3) and (4),
each member has only one vote at a meeting of the
10
co-operative.
(3) If its rules so provide, a member of an association
or federation may have the number of votes up to
5 at a general meeting that is specified in the rules.
(4) If the rules so provide, the chairperson has a
15
second vote at a board meeting or general
meeting.
(5) In the case of joint membership--
(a) the joint members have only one vote
between them; and
20
(b) that vote may be exercised (subject to the
grant of a proxy or power of attorney) only
by the joint member determined in
accordance with the rules.
(6) If shares are held jointly, each member (other than
25
a joint member) holding the share is entitled to
vote at a general meeting.
181. Voting by proxy
(1) If the rules so provide, voting may be by proxy at
a general meeting.
30
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(2) The instrument of proxy may specify the manner
in which a proxy is to vote in respect of a
particular resolution.
(3) The proxy must vote in the manner authorised by
an instrument of proxy referred to in sub-section
5
(2).
(4) A person must not act as a proxy unless he or
she--
(a) is an active member of the co-operative; or
(b) in the case of an association or a federation,
10
is entitled to represent a component co-
operative or association of the association or
federation on the association or federation.
(5) A person must not act as proxy for more than 10
persons (or any lesser number of persons specified
15
in the rules of the co-operative) on any one
occasion.
(6) Sub-section (5) does not apply if the proxy acts
under an instrument of proxy referred to in sub-
section (2).
20
182. Restriction on voting entitlement under power of
attorney
A person is not entitled to exercise, under a power
of attorney, the power of a member of the co-
operative to vote if the person has that power in
25
respect of another member of the co-operative
under another power of attorney.
183. Restriction on voting by representatives of bodies
corporate
A person is not entitled to exercise, as the
30
representative of a body corporate, the power of a
body corporate member of the co-operative to vote
if the person has that power as the representative
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of another body corporate member of the co-
operative.
184. Inactive members not entitled to vote
A member is not entitled to vote if the member is
not an active member of the co-operative.
5
185. Control of the right to vote
(1) A person must not directly or indirectly control the
exercise of the right to vote of a member.
Penalty: 60 penalty units or imprisonment for 6
months, or both.
10
(2) If a person controls the exercise of the right to
vote of a member at a meeting of a co-operative--
(a) the vote of that member; and
(b) the vote of that person, if that person is a
member--
15
are invalid.
(3) Nothing in this section prevents the exercise of a
vote by means of a proxy or power of attorney.
186. Effect of relevant share and voting interests on voting
rights
20
(1) A member of a co-operative is not entitled to vote
if another person (whether or not a member of the
co-operative) has a relevant interest in any share
held by the member or in the right to vote of the
member.
25
(2) A member who is not entitled to vote because of
this section may apply to the Registrar to review
of the matter.
(3) The Registrar may order that the member is
entitled to vote if he or she is satisfied in the
30
circumstances of the case that loss of the right to
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vote would be unjust or unreasonable, and the
order of the Registrar has effect accordingly.
187. Rights of representatives to vote
A person appointed as provided by this Act to
represent a member of a co-operative, association
5
or federation--
(a) is entitled to receive notice of all meetings in
the same manner as the member represented;
and
(b) is entitled to exercise the same rights to vote
10
as the member represented; and
(c) is eligible to be elected to the board of
directors if the member represented holds the
qualifications required for holding office as a
director (other than any relating to age).
15
188. Other rights and duties of members not affected by
ineligibility to vote
A provision of this Act which disentitles a
member of a co-operative to vote (either generally
or in relation to a particular matter) does not affect
20
any other right, entitlement, obligation or duty of
the member as a member.
189. Vote of disentitled member to be disregarded
Any vote cast by or on behalf of a member of a
co-operative when not entitled to vote must be
25
disregarded.
Division 2--Resolutions
190. Decisions to be by ordinary resolution
Except as otherwise provided in this Act or by the
rules of the co-operative, every question for
30
decision by a co-operative must be determined by
ordinary resolution.
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191. Ordinary resolutions
An ordinary resolution is a resolution of a co-
operative which is passed by a simple majority at
a general meeting of the co-operative or in a postal
ballot of members.
5
192. Special resolutions
(1) A special resolution is a resolution of a co-
operative which is passed--
(a) by a two-thirds majority at a general meeting
of members; or
10
(b) by a two-thirds majority in a postal ballot
(other than a special postal ballot) of
members; or
(c) by a three-quarters majority in a special
postal ballot of members.
15
(2) A special resolution may be passed by a postal
ballot only if the rules of the co-operative so
permit or this Act requires the special resolution to
be passed by postal ballot (including a special
postal ballot).
20
(3) A resolution is not to be considered to have been
passed as a special resolution unless not less than
21 days notice has been given to the members of
the co-operative specifying--
(a) the intention to propose the special
25
resolution; and
(b) the reasons for the making of the special
resolution; and
(c) the effect of the special resolution being
passed.
30
(4) A co-operative must give at least 28 days notice to
the Registrar of a proposed special resolution
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before giving notice to the members of the
proposed special resolution.
Penalty: 20 penalty units.
(5) A failure to give notice to the Registrar under sub-
section (4) does not affect the validity of the
5
resolution.
193. How majority obtained is ascertained
(1) A resolution is passed by a particular majority at a
meeting if that majority of the members of the co-
operative who, being entitled to do so, vote in
10
person or (if proxies are allowed) by proxy at the
meeting vote in favour of the resolution.
(2) A resolution is passed by a particular majority in a
postal ballot if that majority of the members of the
co-operative who, being entitled to do so, cast
15
formal votes in the postal ballot vote in favour of
the resolution.
194. Disallowance by Registrar
The Registrar may disallow a proposed special
resolution before it is passed by written notice to
20
the co-operative if the Registrar is of the opinion
that the effect of the special resolution if passed
would be in contravention of this Act or the
regulations or any other law.
195. Declaration of passing of special resolution
25
(1) At a meeting of a co-operative for the purpose of
passing a special resolution, a declaration by the
chairperson of the meeting that the resolution has
been passed as a special resolution is conclusive
evidence of the fact.
30
(2) A declaration by the returning officer for a postal
ballot to pass a special resolution that the
resolution has been passed as a special resolution
is conclusive evidence of that fact.
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(3) Sub-section (1) does not apply if a poll is taken at
the meeting of the co-operative.
196. Effect of special resolution
(1) Subject to sub-section (2), a special resolution has
effect from the date that it is passed.
5
(2) A special resolution relating to any of the
following has no effect until it is registered--
(a) the removal of an auditor;
(b) the expulsion of a member;
(c) if a government guarantee applies in respect
10
of the borrowings of a co-operative, further
borrowing;
(d) any matter for which a special resolution is
required to be passed by special postal ballot.
197. Lodgment of special resolution
15
(1) A co-operative must lodge 2 copies of each
special resolution passed by the co-operative with
the Registrar in accordance with this section for
registration.
(2) The copies must--
20
(a) be lodged within 28 days after the passing of
a special resolution or such further period as
the Registrar allows; and
(b) be signed by a director and the secretary of
the co-operative;
25
(c) be accompanied by the prescribed lodgment
fee.
(3) A co-operative and any officer of the co-operative
that knowingly fails to lodge the required copies in
accordance with this section is guilty of an offence
30
and liable to a penalty not exceeding 20 penalty
units.
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(4) This section and section 198 do not apply to a
special resolution altering the rules of a co-
operative.
198. Decision of Registrar on application to register special
resolution
5
(1) If the Registrar is satisfied that the co-operative
has complied with the provisions of this Act and
the regulations, and that the resolution is not
contrary to this Act or the regulations, the
Registrar must register the resolution.
10
(2) If the Registrar is of the opinion that the effect of a
special resolution lodged for registration would be
in contravention of this Act or the regulations or
any other law, the Registrar may--
(a) refuse to register the special resolution; and
15
(b) give written notice to the co-operative that
the special resolution--
(i) has no effect, in the case of a special
resolution referred to in section 196(2);
and
20
(ii) has no effect as from the date that it
was passed, in any other case.
(3) A certificate of registration of a special resolution
given by the Registrar is, in favour of any person
advancing money to the co-operative on the faith
25
of the certificate or in favour of any guarantor of
that advance, conclusive evidence that the
resolution was duly passed.
Division 3--Postal ballots
199. Postal ballots
30
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(1) A postal ballot may be held as provided by the
rules of a co-operative and must be conducted in
accordance with the regulations.
(2) On the declaration by the returning officer of the
result of the ballot, the secretary of the co-
5
operative must make an entry in the minute book
of the co-operative showing--
(a) the number of formal votes cast in favour of
the proposal concerned; and
(b) the number of formal votes cast against the
10
proposal; and
(c) the number of informal votes cast.
200. Special postal ballots
(1) A special postal ballot is a postal ballot that is
conducted as required by this section.
15
(2) The ballot must not be held less than 21 days after
notice of the ballot is given to members so as to
enable sufficient time for a meeting to discuss the
proposal that is the subject of the ballot to be
convened and held (whether by the board or on the
20
requisition of members).
(3) The co-operative must send to each member
(along with any other material required to be sent
in connection with the postal ballot) a disclosure
statement approved by the Registrar and
25
containing information concerning--
(a) the financial position of the co-operative; and
(b) the interests of the directors of the co-
operative in the proposal with which the
ballot is concerned, including any interests of
30
the directors in another organisation
concerned in the proposal; and
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(c) any compensation or consideration to be paid
to officers or members of the co-operative in
connection with the proposal; and
(d) such other matters as the Registrar directs.
(4) If the Registrar so requires, the statement is to be
5
accompanied by a report made by an independent
person approved by the Registrar concerning any
matters that the Registrar directs.
(5) Sections 17 (except sub-section (2)) and 29 apply
to the approval of a disclosure statement under
10
this section with any necessary modifications and
in particular as if any reference in section 17 to a
formation meeting were a reference to the notice
of the special postal ballot.
201. When is a special postal ballot required?
15
In addition to any requirement of this Act, the
rules of a co-operative must require a special
postal ballot to be conducted for the purpose of
passing a special resolution in relation any of the
following matters relating to a co-operative--
20
(a) conversion of--
(i) a share capital co-operative to a non-
share capital co-operative or vice versa;
or
(ii) a trading co-operative to a non-trading
25
co-operative or vice versa;
(b) transfer of incorporation;
(c) an acquisition or disposal of assets referred
to in section 275;
(d) the maximum permissible level of share
30
interest in the co-operative;
(e) takeover;
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(f) merger;
(g) transfer of engagements;
(h) members' voluntary winding-up.
202. Holding of postal ballot on requisition
(1) The board of a co-operative must conduct a postal
5
ballot (including a special postal ballot) for the
purpose of the passing of a special resolution on
the written requisition of such number of members
who together are able to cast at least 20% (or any
lesser percentage specified in the rules of the co-
10
operative) of the total number of votes able to be
cast at a meeting of the co-operative.
(2) A member is not entitled to be a requisitioning
member unless the member is an active member.
(3) The following provisions apply to a requisition for
15
a postal ballot--
(a) it must specify--
(i) the proposed special resolution to be
voted on;
(ii) the reasons for the making of the
20
special resolution; and
(iii) the effect of the special resolution being
passed;
(b) it must be signed by the requisitioning
members (and may consist of several
25
documents in like form each signed by one
or more of the requisitioning members);
(c) it must be served on the co-operative by
being lodged at the registered office of the
co-operative.
30
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(4) The postal ballot must be conducted as soon as
practicable and in any case must be conducted
within 2 months after the requisition is served.
(5) If the special resolution for which the
requisitioned postal ballot is conducted is not
5
passed, the co-operative may recover the expenses
of the postal ballot from the members who
requisitioned the postal ballot as a debt due to the
co-operative.
203. Expenses involved in postal ballots on requisition
10
(1) All reasonable expenses incurred by a co-
operative in and in connection with preparing for
and holding a special postal ballot are to be
considered to constitute the "expenses of the
postal ballot'' for the purposes of section 202.
15
(2) Those expenses include (but are not limited to) the
following expenses--
(a) the cost of obtaining expert advice (including
legal and financial advice) and of
commissioning expert reports;
20
(b) costs attributable to the use of staff of the co-
operative in connection with preparing for
and holding the ballot;
(c) the cost of producing, printing and posting
the ballot papers and other material
25
associated with the ballot.
Division 4--Meetings
204. Annual general meetings
(1) The first annual general meeting of a co-operative
must be held at any time within 19 months after
30
the incorporation of the co-operative.
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(2) The second or any subsequent annual general
meeting of a co-operative must be held within--
(a) 5 months after the close of the financial year
of the co-operative; or
(b) any further time that may be allowed by the
5
Registrar or is prescribed.
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205. Special general meetings
A special general meeting of a co-operative may
be convened at any time by the board of directors.
206. Notice of meetings
The board must give each member at least 14 days
5
notice of each general meeting.
207. Quorum at meetings
(1) The quorum for a meeting of a co-operative must
be specified in the rules.
(2) An item of business must not be transacted at a
10
meeting of a co-operative unless a quorum of
members entitled to vote is present during the
transaction of that item.
208. Decision at meetings
(1) A question for decision at a general meeting must
15
be determined by a majority of members present
in person at the meeting and voting, but this is
subject to any other provisions of this Act and to
the rules of the co-operative.
(2) Unless a poll is demanded by at least 5 members,
20
a question for decision at a general meeting must
be determined by a show of hands.
(3) In the case of an equality of votes, whether on a
show of hands or on a poll, the chairman of the
meeting at which the show of hands takes place or
25
at which the poll is demanded may exercise a
second or casting vote if the rules so provide.
209. Convening of general meeting on requisition
(1) The board of a co-operative must convene a
general meeting of the co-operative on the written
30
requisition of such number of members who
together are able to cast at least 20% (or any lesser
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percentage specified in the rules of the co-
operative) of the total number of votes able to be
cast at a meeting of the co-operative.
(2) A member is not entitled to be a requisitioning
member unless the member is an active member.
5
(3) The following provisions apply to a requisition for
a general meeting--
(a) it must state the objects of the meeting;
(b) it must be signed by the requisitioning
members (and may consist of several
10
documents in like form each signed by one
or more of the requisitioning members);
(c) it must be served on the co-operative by
being lodged at the registered office of the
co-operative.
15
(4) The meeting must be convened and held as soon
as practicable and in any case must be held within
2 months after the requisition is served.
(5) If the board does not convene the meeting within
21 days after the requisition is served, the
20
following provisions apply--
(a) the requisitioning members (or any of them
representing at least half their aggregate
voting rights) may convene the meeting in
the same manner as nearly as possible as
25
meetings are convened by the board;
(b) for that purpose they may request the co-
operative to supply a written statement
setting out the names and addresses of the
persons entitled when the requisition was
30
served to receive notice of general meetings
of the co-operative;
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(c) the board must send the requested statement
to the requisitioning members within 7 days
after the request for the statement is made;
(d) the meeting convened by the requisitioning
members must be held not later than 3
5
months after the requisition is served;
(e) any reasonable expenses incurred by the
requisitioning members because of the
board's failure to convene the meeting must
be paid by the co-operative;
10
(f) any amount required to be paid by the co-
operative under paragraph (e) must be
retained by the co-operative out of any
money due from the co-operative by way of
fees or other remuneration in respect of their
15
services to such of the directors as were in
default.
210. Minutes
(1) Minutes of each general meeting, board meeting
and sub-committee meeting must be entered in the
20
appropriate records and confirmed at and signed
by the chairperson of the next succeeding meeting.
(2) The minutes of each general meeting must be
available for inspection by members.
(3) The rules may provide that the minutes of board
25
meetings and sub-committee meetings be
available for inspection by members.
(4) Minutes must be kept in the English language.
_______________
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PART 9--MANAGEMENT AND ADMINISTRATION OF CO-
OPERATIVES
Division 1--The Board
211. Board of directors
(1) Subject to this Act and the rules of the co-
5
operative, the business of a co-operative shall be
managed by a board of directors.
(2) The board of directors may exercise all the powers
of the co-operative that are not, by this Act or the
rules of the co-operative, required to be exercised
10
by the co-operative in general meeting.
(3) The acts of a director are valid despite any defect
that may afterwards be discovered in his or her
appointment or qualification.
212. Election of directors
15
(1) Except as provided in sub-sections (2), (3) and (4),
the directors of a co-operative are to be elected in
the manner specified in the rules of the co-
operative.
(2) The first directors of--
20
(a) a co-operative formed under this Act are to
be elected at its formation meeting; and
(b) a co-operative which was a body corporate
incorporated under another Act are to be the
directors in office at the date of registration
25
under this Act.
(3) If so authorised by the rules of the co-operative, a
board of directors may appoint a person to fill a
casual vacancy in the office of a director until the
next annual general meeting.
30
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(4) A motion approving or nominating for election 2
or more persons as directors by a single resolution
must not be made at a meeting of a co-operative
unless a resolution that it be so made has first been
agreed to by the meeting without any vote being
5
given against it.
(5) If a resolution is passed following a motion in
contravention of sub-section (4)--
(a) the resolution is void;
(b) there is no provision for the automatic re-
10
election of retiring directors in default of
another election.
(6) This section does not apply to a resolution altering
the rules to prevent the election of 2 or more
directors by ballot.
15
(7) A nomination for election or appointment to the
office of a director must provide details of the
qualifications and experience of the person
nominated.
(8) Except as specified in this Act or in the rules of a
20
co-operative, a director is eligible for re-election at
the expiration of his or her term of office.
213. Qualification of directors
(1) A person is not qualified to be a director of a co-
operative unless he or she is--
25
(a) a member of the co-operative or a
representative of a body corporate which is a
member of the co-operative ("member
director"); or
(b) an employee of the co-operative or a person
30
qualified as provided by the rules
("independent director").
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(2) A person may only be elected or appointed as an
independent director if there are at least 3 member
directors appointed for each independent director.
214. Disqualified persons
(1) A person must not act as a director or directly or
5
indirectly take part in or be concerned with the
management of a co-operative if the person--
(a) is the auditor of the co-operative or a partner,
employee or employer of the auditor;
(b) has been convicted, whether before or after
10
the commencement of this section, within or
outside Victoria--
(i) on indictment of an offence in
connection with the promotion,
formation or management of a body
15
corporate; or
(ii) of an offence involving fraud or
dishonesty punishable on conviction by
imprisonment for a period of not less
than 3 months; or
20
(iii) of any offence under section 232, 590,
591, 592, 704, 705 or 996 of the
Corporations Law of Victoria or under
any provision of a law in force in
another State or in a Territory that
25
corresponds with any of those sections;
or
(iv) of any offence under any provision of a
previous law of Victoria or of another
State or Territory, with which any of
30
the provisions referred to in sub-
paragraph (iii) corresponds--
within a period of 5 years after the
conviction or, if sentenced to imprisonment,
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after his or her release from prison, except
with the leave of the Supreme Court.
Penalty: 240 penalty units or imprisonment for
2 years, or both.
(2) A person must not act as a director or directly or
5
indirectly take part in or be concerned with the
management of a co-operative if the person--
(a) has been convicted of any offence under this
Act, within a period of 5 years after the
conviction, except with leave of the Supreme
10
Court; or
(b) is prohibited from being a director of a
company under section 599 of the
Corporations Law of Victoria; or
(c) is an insolvent under administration (as
15
defined in the Corporations Law); or
(d) is prohibited from managing a co-operative
by an order under section 1317EA of the
Corporations Law, as adopted under this Act.
Penalty: 240 penalty units or imprisonment for
20
2 years, or both.
(3) In any proceeding for an offence against sub-
section (1), a certificate by a prescribed authority
stating that a person was released from prison on a
specified date, is in the absence of evidence to the
25
contrary, proof that that person was released from
prison on that date.
(4) A person who intends to apply for leave of the
Supreme Court must give the Registrar at least 21
days notice of his or her intention.
30
(5) The Supreme Court may grant leave subject to any
condition or limitation it considers appropriate.
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(6) A person must comply with any condition or
limitation subject to which leave is granted.
Penalty: 240 penalty units or imprisonment for
2 years, or both.
(7) On the application of the Registrar the Supreme
5
Court may revoke its leave.
(8) Subject to this section, section 599 of the
Corporations Law of Victoria is adopted as far as
is applicable to co-operatives and applies with any
modifications that are necessary and any other
10
modifications that are prescribed.
215. Meeting of the board of directors
(1) Meetings of the board of directors must be held at
least once every 3 months and may be held as
often as may be necessary.
15
(2) A meeting of the board of directors may be called
by a director giving notice individually to every
other director.
(3) A meeting of the board of directors may be called
or held using any technology consented to by the
20
board. The consent may be a standing one.
(4) A quorum of a meeting of the board of directors is
50 per cent of the number of directors or such
greater number of the directors as is specified in
the rules.
25
(5) The chairperson of the board may be elected either
by the board or at a general meeting of the co-
operative, and is to be elected, hold office, and
retire, and may be removed from office, as
provided by the rules of the co-operative.
30
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216. Transaction of business outside meetings
(1) The board of a co-operative may, if it thinks fit,
transact any of its business by the circulation of
papers among all of the directors of the board.
(2) A resolution in writing approved in writing by a
5
majority of the directors of the board is to be taken
to be a decision of the board.
(3) Separate copies of a resolution may be distributed
for signing by the directors if the wording of the
resolution and approval is identical in each copy.
10
(4) For the purpose of the approval of a resolution
under this section, the chairperson of the board
and each director of the board have the same
voting rights as they have at an ordinary meeting
of the board.
15
(5) The resolution is approved when the last director
required for the majority signs.
(6) A resolution approved under this section must be
recorded in the minutes of the meetings of the
board.
20
(7) Papers may be circulated among directors of the
board for the purposes of this section by facsimile
or other transmission of the information in the
papers concerned.
217. Deputy directors
25
(1) In the absence of a director from a meeting of the
board, a person appointed by the board in
accordance with the rules of the co-operative
concerned to act as a deputy for that director may
act in the place of that director.
30
(2) The rules of the co-operative may include
provisions regulating the term of office, vacation
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of or removal from office, and remuneration of a
deputy.
218. Delegation by board
(1) If the rules of a co-operative so provide, the board
may, by resolution, delegate the exercise of such
5
of the board's functions (other than this power of
delegation) as are specified in the resolution--
(a) to a director; or
(b) to a committee of 2 or more directors; or
(c) to a committee of members of the co-
10
operative; or
(d) to a committee of members of the co-
operative and other persons if members
comprise the majority of persons on the
committee.
15
(2) The co-operative or the board may, by resolution,
revoke wholly or in part a delegation under this
section.
(3) A function, the exercise of which has been
delegated under this section, may be exercised
20
from time to time in accordance with the terms of
the delegation while the delegation remains
unrevoked.
(4) A delegation under this section may be made
subject to conditions or limitations as to the
25
exercise of any of the functions delegated, or as to
time or circumstance.
(5) Despite any delegation under this section, the
board may continue to exercise all or any of the
functions delegated.
30
219. Removal from and vacation of office
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(1) The directors hold office and must retire, and may
be removed from office, as provided by the rules
of the co-operative.
(2) A director vacates office in the circumstances (if
any) provided in the rules of the co-operative and
5
in any of the following cases--
(a) if the director is disqualified from being a
director as provided by section 214;
(b) if the director absents himself or herself from
3 consecutive ordinary meetings of the board
10
without its leave;
(c) if the director resigns the office of director by
written notice given by the director to the co-
operative;
(d) if the director is removed from office by
15
special resolution of the co-operative;
(e) if the person ceases to hold the qualification
by reason of which the person was qualified
to be a director;
(f) if an administrator of the co-operative's
20
affairs is appointed under Division 5 of
Part 12.
Division 2--Duties and liabilities of directors, officers and
employees
220. Meaning of "officer''
25
In this Division--
"officer'', in relation to a co-operative, means--
(a) a director or secretary of the co-
operative; or
(b) a person who is concerned, or takes
30
part, in the management of the co-
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operative, whether or not as a director;
or
(c) a receiver, or receiver and manager, of
property of the co-operative, or any
other authorised person who enters into
5
possession or assumes control of
property of the co-operative for the
purpose of enforcing any charge; or
(d) an administrator of a deed of
arrangement executed by the co-
10
operative; or
(e) a liquidator or provisional liquidator
appointed in a voluntary winding up of
the co-operative; or
(f) an administrator of the co-operative
15
appointed under Part 5.3A of the
Corporations Law as adopted and
applying under this Act; or
(g) a trustee or other person administering a
compromise or arrangement made
20
between the co-operative and another
person or other persons.
221. Officers must act honestly
(1) An officer of a co-operative must at all times act
honestly in the exercise of his or her powers and
25
the discharge of the duties of his or her office,
both in the State and elsewhere.
(2) The penalty applicable to a contravention of this
section is--
(a) if the contravention was committed with
30
intent to deceive or defraud the co-operative,
members or creditors of the co-operative or
creditors of any other person or for any other
fraudulent purpose, a penalty not exceeding
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240 penalty units or imprisonment for 2
years, or both; or
(b) in any other case, a penalty not exceeding
60 penalty units.
222. Standard of care and diligence required
5
(1) In the exercise of his or her powers and the
discharge of his or her duties, an officer of a co-
operative must exercise the degree of care and
diligence that a reasonable person in a like
position in a co-operative would exercise in the
10
co-operative's circumstances.
Penalty: 20 penalty units.
(2) An officer is not liable to be convicted for a
contravention of this section if the co-operative
has resolved by ordinary resolution to forgive the
15
contravention.
223. Improper use of information or position
(1) An officer or employee or former officer or
employee of a co-operative or a member of a
committee referred to in section 218(1) must not
20
make improper use of information acquired by
reason of his or her position as such an officer or
employee or member to gain, directly or
indirectly, an advantage for himself or herself or
for any other person or to cause detriment to the
25
co-operative.
(2) An officer or employee of a co-operative or a
member of a committee referred to in section
218(1) must not make improper use of his or her
position as an officer or employee or member, to
30
gain, directly or indirectly, an advantage for
himself or herself or for any other person or to
cause detriment to the co-operative.
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(3) The penalty applicable to a contravention of this
section is--
(a) if the contravention was committed with
intent to deceive or defraud the co-operative,
members or creditors of the co-operative or
5
creditors of any other person or for any other
fraudulent purpose, a penalty not exceeding
240 penalty units or imprisonment for 2
years, or both; or
(b) in any other case, a penalty not exceeding 60
10
penalty units.
224. Court may order payment of compensation
(1) If the court that convicts a person for a
contravention of a provision of this Division is
satisfied that a co-operative has suffered loss or
15
damage as a result of the act or omission that
constituted the offence, the court may (in addition
to imposing a penalty) order the convicted person
to pay a specified amount of compensation to the
co-operative.
20
(2) An order under sub-section (1) may be enforced as
if it were a judgment of that court.
225. Recovery of damages by co-operative
(1) If a person contravenes a provision of this
Division in relation to a co-operative, the co-
25
operative may, whether or not the person has been
convicted of an offence in respect of that
contravention, recover an amount from the person
as a debt due to the co-operative.
(2) The amount that the co-operative is entitled to
30
recover from the person is--
(a) if the person or any other person made a
profit as a result of the contravention, an
amount equal to that profit; and
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(b) if the co-operative has suffered loss or
damage as a result of the contravention, an
amount equal to that loss or damage.
226. Other duties and liabilities not affected
This Division has effect in addition to, and not in
5
derogation of, any rule of law relating to the duty
or liability of a person by reason of the person's
office or employment in relation to a co-operative
and does not prevent the institution of any civil
proceedings in respect of a breach of such a duty
10
or in respect of such a liability.
227. Indemnification of officers and auditors
(1) Any provision, whether contained in the rules or
in a contract with a co-operative or elsewhere, for
exempting any officer or auditor of the co-
15
operative from, or indemnifying the officer or
auditor against, any liability that by law would
otherwise attach to the officer or auditor in respect
of any negligence, default, breach of duty or
breach of trust of which the officer or auditor may
20
be guilty in relation to the co-operative is void.
(2) Sub-section (1) does not apply in relation to a
contract of insurance.
(3) Despite sub-section (1), a co-operative may,
pursuant to its rules or otherwise, indemnify an
25
officer or auditor against any liability incurred by
the officer or auditor in defending any
proceedings, whether civil or criminal, in which
judgment is given in the officer's or auditor's
favour or in which the officer or auditor is
30
acquitted or in connection with any application in
relation to any such proceedings in which relief is
under this section granted to the officer or auditor
by the court.
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(4) If in proceedings for negligence, default or breach
of duty against an officer or auditor of a co-
operative it appears to the court that the person is
or may be liable in respect of the negligence,
default or breach of duty but acted honestly and
5
reasonably and that, having regard to all the
circumstances of the case (including those
connected with the person's appointment), the
person ought fairly to be excused for the
negligence, default or breach of duty, the court
10
may relieve the person, either wholly or partly,
from the person's liability on such terms as the
court thinks fit.
(5) If an officer or auditor of a co-operative has reason
to believe that any claim will or might be made
15
against him or her in respect of any negligence,
default or breach of duty in relation to the co-
operative, the person may apply to the Supreme
Court for relief, and the Supreme Court then has
the same power to relieve the person as it would
20
have under this section if it had been a court
before which proceedings against the officer or
auditor for negligence, default or breach of duty
had been brought.
(6) If any case to which sub-section (4) applies is
25
being tried by a judge with a jury, the judge, after
hearing the evidence, may, if satisfied that the
defendant should in pursuance of that sub-section
be relieved either wholly or partly from the
liability sought to be enforced against him or her,
30
withdraw the case in whole or in part from the jury
and direct judgment to be entered for the
defendant on such terms as to costs or otherwise
as the judge thinks proper.
(7) In this section, "officer'' includes an employee of
35
a co-operative and any other person empowered
under the rules of the co-operative to give
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Act No.
directions in regard to the business of the co-
operative.
228. Adoption of Corporations Law provisions concerning
officers of co-operatives
(1) The provisions of sections 589 to 598 and 1307 of
5
the Corporations Law are adopted by this section
and apply to and in respect of a co-operative in the
same way as they apply to and in respect of a
company.
(2) Those provisions apply with any modifications
10
that are prescribed and as if--
(a) a reference in those provisions to a company
were a reference to a co-operative; and
(b) a reference in those provisions to the
Commission were a reference to the
15
Registrar; and
(c) the reference in section 591 to section 289
were a reference to the provision of this Act
relating to the keeping of accounts of a co-
operative.
20
Division 3--Restrictions on directors and officers
229. Directors' remuneration
A director of a co-operative must not be paid any
remuneration for services as a director other than
fees, concessions and other benefits that are
25
approved at a general meeting of the co-operative.
230. Certain financial accommodation to officers
prohibited
(1) An officer of a co-operative who is not a director
of the co-operative must not obtain financial
30
accommodation from the co-operative other
than--
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(a) with the approval of a majority of the
directors; or
(b) under a scheme about providing financial
accommodation to officers that has been
approved by a majority of the directors.
5
Penalty: 240 penalty units or imprisonment for
2 years, or both.
(2) For the purposes of this section, financial
accommodation is taken to be obtained by an
officer of a co-operative if it is obtained by--
10
(a) a proprietary company in which the officer is
a shareholder or director; or
(b) a trust of which the officer is a trustee or
beneficiary; or
(c) a trust of which a body corporate is trustee if
15
the officer is a director or other officer of the
body corporate.
(3) A co-operative must not give financial
accommodation to an officer of the co-operative
if--
20
(a) by giving the financial accommodation, the
officer would contravene this section; and
(b) the co-operative knows or should reasonably
know of the contravention.
Penalty: 500 penalty units.
25
231. Financial accommodation to directors and associates
(1) In this section--
"associate" of a director means--
(a) the director's spouse; or
(b) a person when acting in the capacity of
30
trustee of a trust under which--
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(i) the director or director's spouse
has a beneficial interest; or
(ii) a body corporate mentioned in
paragraph (c) has a beneficial
interest; or
5
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(c) a body corporate if--
(i) the director or director's spouse
has a material interest in shares in
the body corporate; and
(ii) the nominal value of the shares is
5
not less than 10% of the nominal
value of the issued share capital of
the body corporate.
(2) For the purposes of this section, a person has a
"material interest" in a share in a body corporate
10
if--
(a) the person has power to withdraw the share
capital subscribed for the share or to exercise
control over the withdrawal of that share
capital; or
15
(b) the person has power to dispose of or to
exercise control over the disposal of the
share; or
(c) the person has power to exercise or to control
the exercise of any right to vote conferred on
20
the holder of the share.
(3) A co-operative must not provide financial
accommodation to a director, or to a person the
co-operative knows or should reasonably know is
an associate of a director, unless--
25
(a) the accommodation is--
(i) approved under sub-section (4); or
(ii) given under a scheme approved under
sub-section (4); or
(iii) provided on terms no more favourable
30
to the director or associate than the
terms on which it is reasonable to
expect the co-operative would give if
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dealing with the director or associate at
arm's length in the same circumstances;
and
(b) the directors have approved the
accommodation, at a meeting of the board at
5
which a quorum was present, by a majority
of at least two-thirds of the directors present
and voting on the matter.
Penalty: 500 penalty units.
(4) For the purposes of sub-section (3)(a)(i)and (ii),
10
financial accommodation or a scheme is approved
if--
(a) it is approved by a resolution passed at a
general meeting; and
(b) the full details of the accommodation or
15
scheme were made available to members at
least 21 days before the meeting.
(5) A director or an associate of a director who
obtains financial accommodation given in
contravention of sub-section (3) is guilty of an
20
offence and liable to a penalty not exceeding 240
penalty units or 2 years imprisonment, or both.
(6) For the purposes of this section, a concessional
rate of interest for a borrower from a co-operative
is a normal term only if the borrower is entitled to
25
the concession by being a member of a class of
borrowers from the co-operative specified in its
rules as being entitled to the concession.
(7) If a director of a co-operative or an associate of a
director accepts in payment of a debt owed by a
30
member of the co-operative to the director or
associate, any proceeds of financial
accommodation provided to the member by the
co-operative, this section has effect as if the
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financial accommodation has been provided to the
director or associate.
(8) In this section, a reference to--
(a) the provision of financial accommodation to
a director or an associate of a director; or
5
(b) the obtaining of financial accommodation by
a director or an associate of a director; or
(c) a debt owed to a director or an associate of a
director--
includes a reference to a provision of financial
10
accommodation to, or an obtaining of financial
accommodation by, the director or associate, or a
debt owed to the director or associate, jointly with
another person.
232. Restriction on directors of certain co-operatives
15
selling land to co-operative
A director of a co-operative the primary activity of
which is or includes the acquisition of land in
order to settle or retain people on the land and of
providing any community service or benefit must
20
not sell land to the co-operative except pursuant to
and in accordance with a special resolution of the
co-operative.
233. Management contracts
(1) In this section "management contract" means a
25
contract or other arrangement under which--
(a) a person who is not an officer of the co-
operative agrees to perform the whole, or a
substantial part, of the functions of the co-
operative, whether under the control of the
30
co-operative or not; or
(b) a co-operative agrees to perform the whole or
a substantial part of its functions--
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(i) in a particular way; or
(ii) in accordance with the directions of any
person; or
(iii) subject to specified restrictions or
conditions.
5
(2) A co-operative must not enter into a management
contract unless that contract has first been
approved by special resolution.
(3) A management contract entered into in
contravention of sub-section (2) is void.
10
Division 4--Declaration of interests
234. Declaration of interest
(1) A director of a co-operative who is or becomes in
any way (whether directly or indirectly) interested
in a contract, or proposed contract with the co-
15
operative must declare the nature and extent of the
interest to the board of directors under this
section.
Penalty: 240 penalty units or imprisonment for
2 years, or both.
20
(2) In the case of a proposed contract, the declaration
must be made--
(a) at the meeting of the board at which the
question of entering into the contract is first
considered; or
25
(b) if the director was not at that time interested
in the proposed contract, at the next meeting
of the board held after the director becomes
interested in the proposed contract.
(3) If a director becomes interested in a contract with
30
the co-operative after it is made, the declaration
must be made at the next meeting of the board
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held after the director becomes interested in the
contract.
(4) For the purposes of this section, a general written
notice given to the board by a director to the effect
that the director--
5
(a) is a member of a specified entity; and
(b) is to be regarded as interested in any contract
which may, after the giving of the notice, be
made with the entity--
is a sufficient declaration.
10
(5) A director of a co-operative who holds an office or
has an interest in property whereby, whether
directly or indirectly, duties or interests might be
created that could conflict with the director's
duties or interests as director must, under sub-
15
section (6) declare at a meeting of the board of
directors the fact and the nature, character and
extent of the conflict.
Penalty: 240 penalty units or imprisonment for
2 years, or both.
20
(6) A declaration required by sub-section (5) in
relation to holding an office or having an interest
must be made by a person--
(a) if the person holds the office or has the
interest when he or she becomes a director,
25
at the first meeting of the board held after--
(i) the person becomes a director; or
(ii) the relevant facts as to holding the
office or having the interest come to the
person's knowledge--
30
whichever is the later; or
(b) if the person starts to hold the office or
acquires the interest after the person becomes
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a director, at the first meeting of the board
held after the relevant facts as to holding the
office or having the interest come to the
person's knowledge.
(7) If a director has made a declaration under this
5
section, then unless the board otherwise
determines, the director must not--
(a) be present during any deliberation of the
board in relation to the matter; or
(b) take part in any decision of the board in
10
relation to the matter.
(8) For the purposes of the making of a determination
of the board under sub-section (7) in relation to a
director who has made a declaration under this
section, the director must not--
15
(a) be present during any deliberation of the
board for the purpose of making the
determination; or
(b) take part in the making by the board of the
determination.
20
235. Declarations to be recorded in minutes
Every declaration under this Division is to be
recorded in the minutes of the meeting at which it
was made.
236. Division does not affect other laws or rules
25
Except as provided in section 237, this Division is
in addition to, and not in derogation of, the
operation of any rule of law or any provision in
the rules of the co-operative restricting a director
from having any interest in contracts with the co-
30
operative or from holding offices or possessing
properties involving duties or interests in conflict
with his or her duties or interests as director.
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237. Certain interests need not be declared
The interest in a contract or proposed contract that
a director is required by this Division to declare
does not include an interest in--
(a) a contract or proposed contract for a
5
purchase of goods and services by the
director from the co-operative; or
(b) a lease of land to the director by the co-
operative; or
(c) a contract or proposed contract for the sale of
10
agricultural products or live stock by the
director to the co-operative; or
(d) a contract or proposed contract that, pursuant
to the rules of the co-operative, may be made
between the co-operative and a member; or
15
(e) a contract or proposed contract of a class of
contracts prescribed for the purposes of this
section--
but only if the contract is made in good faith, in
the ordinary course of the business of the co-
20
operative, and on such terms as are usual and
proper in similar dealings between the co-
operative and its members.
Division 5--Accounts and audit
238. Requirements for accounts and accounting records
25
(1) A co-operative must--
(a) keep accounting records and prepare
accounts and consolidated accounts as
required by the regulations; and
(b) ensure that those accounts are audited in
30
accordance with the regulations.
Penalty: 20 penalty units.
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(2) Without limiting the matters for which regulations
under this section may make provision, the
regulations may make provision for or with
respect to the following--
(a) any matter for which provision is made by or
5
under Parts 3.6 and 3.7 of the Corporations
Law (including the conferring of jurisdiction
on a court);
(b) requiring accounts and consolidated accounts
to be prepared in accordance with any
10
accounting standards in force for the
purposes of Parts 3.6 and 3.7 of the
Corporations Law (with or without
modifications specified in the regulations);
(c) requiring the submission of accounts or
15
consolidated accounts to the Australian
Accounting Standards Board;
(d) requiring the adoption by a co-operative of
the same financial year for each entity that
the co-operative controls;
20
(e) prescribing the qualifications and the
functions of auditors of the accounts of a co-
operative and providing for the appointment,
the holding of office by, the remuneration of
and the removal of auditors;
25
(f) the duties of directors of a co-operative in
relation to the preparation, the auditing and
the laying before meetings of members of
accounts and consolidated accounts,
including the reports to be prepared by
30
directors in relation to those accounts and
consolidated accounts;
(g) the sending or making available to members
of copies of accounts and reports in relation
to accounts.
35
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(3) The regulations may make provision for a matter
for which the Corporations Law makes provision
by adopting (with or without modification)
provisions of the Corporations Law.
239. Power of Registrar to grant exemptions
5
(1) The Registrar may, by order in writing, exempt a
co-operative or any class of co-operatives or a
director or auditor of a co-operative from
compliance with all or specified provisions of the
regulations made for the purposes of this Part.
10
(2) An exemption--
(a) may be given subject to conditions; and
(b) may be limited as to time; and
(c) may be varied, suspended or revoked by the
Registrar by a further order in writing.
15
(3) An order under this section takes effect--
(a) if it applies to a particular co-operative, when
the order is served on the co-operative; or
(b) if it applies to a class of co-operatives, when
the order is published in the Government
20
Gazette.
240. Meaning of "entity'' and "control''
In this Division, "entity'' and "control'' have the
same meanings in relation to a co-operative as
they have under the Corporations Law in relation
25
to a corporation.
241. Disclosure by directors
The directors of a co-operative must make the
disclosures in relation to the affairs of the co-
operative and of any entity that the co-operative
30
controls that are required by the regulations.
Penalty: 20 penalty units.
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242. Protection of auditors etc.
(1) An auditor of a co-operative has qualified
privilege in respect of--
(a) any statement that the auditor makes, orally
or in writing, in the course of his or her
5
duties as auditor; or
(b) the giving of any notice, or the sending of
any copy of accounts, consolidated accounts
or a report, to the Registrar under this Act.
(2) A person has qualified privilege--
10
(a) in respect of the publishing of any document
prepared by an auditor in the course of the
auditor's duties and required by or under this
Act to be lodged with the Registrar, whether
or not the document has been so lodged; or
15
(b) in respect of the publishing of any statement
made by an auditor as mentioned in sub-
section (1).
(3) This section does not limit or affect any right,
privilege or immunity that an auditor or other
20
person has, apart from this section, as defendant in
proceedings for defamation.
243. Financial year
(1) The financial year of a co-operative is to end on
the day in each calendar year that is provided for
25
by the rules of the co-operative.
(2) The first financial year of a co-operative may
extend from the date of its registration to a date
not later than 18 months from the date of its
registration.
30
(3) On an alteration of the rules of a co-operative
altering its financial year, the alteration may
provide either that the financial year current at the
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date of alteration is to be extended for a period not
exceeding 6 months or that the financial year next
following the financial year that is so current is to
be a period exceeding 12 months but not
exceeding 18 months.
5
Division 6--Registers, records and returns
244. Registers to be kept by co-operatives
(1) A co-operative must keep the following registers
in accordance with this section--
(a) a register of members, directors and shares
10
(if any);
(b) a register of any loans to, securities given by,
debentures issued by and deposits received
by the co-operative;
(c) a register of names of persons who have
15
given loans or deposits to or hold securities
or debentures given or issued by the co-
operative;
(d) a register of any loans made by or guaranteed
by the co-operative, and of any securities
20
taken by the co-operative;
(e) a register of memberships cancelled under
Part 6;
(f) a register of notifiable interests in accordance
with section 285;
25
(g) such other registers as the regulations may
require.
Penalty: 20 penalty units.
(2) The registers must be kept in the manner and
contain the particulars that are prescribed by this
30
Act or the regulations.
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245. Location of registers
(1) A register kept under this Division must be kept
at--
(a) the co-operative's registered office; or
(b) an office at the co-operative's principal place
5
of business; or
(c) an office (whether of the co-operative or of
someone else) where the work involved in
maintaining the register is done; or
(d) another office approved by the Registrar.
10
(2) The office must be in Victoria.
(3) The co-operative must lodge with the Registrar a
notice of the address at which the register is kept
within 28 days after the register is--
(a) established at an office that is not the co-
15
operative's registered office; or
(b) moved from one office to another.
246. Inspection of registers etc.
(1) A co-operative must have at the office where the
registers are kept and available during all
20
reasonable hours for inspection by any member
free of charge the following--
(a) a copy of this Act and the regulations;
(b) a copy of the rules of the co-operative;
(c) a copy of the minutes of each general
25
meeting of the co-operative;
(d) a copy of the last annual report of the co-
operative under section 249;
(e) the register of directors, members and shares;
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(f) the register of names of persons who have
given loans or deposits to or hold securities
or debentures given or issued by the co-
operative;
(g) such other registers as the regulations
5
provide are to be open for inspection under
this section.
(2) If a register is not kept on a computer, the person
inspects the register itself.
(3) If the register is kept on a computer, the person
10
inspects a hard copy of the information on the
register unless the person and the co-operative
agree that the person can access the information
by computer.
(4) A member is entitled to make a copy of entries in
15
a register specified in sub-section (1) and to do so
free of charge unless the rules of the co-operative
require a fee to be paid, in which case on payment
of the required fee.
(5) The fee required by the rules must not exceed the
20
fee prescribed for a copy of any entry in the
Register.
(6) A co-operative must--
(a) permit a member to inspect a document or
make a copy of a document that the member
25
is entitled to inspect or make under this
section; and
(b) give the member all reasonable assistance to
inspect the document or make the copy.
Penalty: 20 penalty units.
30
(7) A co-operative must have at the place where the
registers are kept and available during all
reasonable hours for inspection by any person
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such documents in relation to the co-operative as
are prescribed.
Penalty: 20 penalty units.
247. Use of information on registers
(1) A person must not--
5
(a) use information about a person obtained
from a register kept under this Division to
contact or send material to the person; or
(b) disclose information of that kind knowing
that the information is likely to be used to
10
contact or send material to the person--
unless that use or disclosure of the information
is--
(c) relevant to the holding of the directorship,
membership, shares, loans, securities,
15
debentures or deposits concerned or the
exercise of the rights attaching to them; or
(d) approved by the board; or
(e) necessary to comply with a requirement of
this Act.
20
(2) A person who contravenes sub-section (1) is liable
to compensate anyone else who suffers loss or
damage because of the contravention.
(3) A person who makes a profit from a contravention
of sub-section (1) owes a debt to the co-operative.
25
The amount of the debt is the amount of the profit.
248. Notice of appointment etc. of directors and officers
(1) A co-operative must give notice to the Registrar in
accordance with this section of the appointment of
a person as a director, principal executive officer
30
or secretary of the co-operative or any subsidiary
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of the co-operative, and of the cessation of any
such appointment.
(2) The notice must--
(a) be in the form approved by the Registrar; and
(b) be given within 28 days after the
5
appointment or cessation of appointment;
and
(c) specify the prescribed particulars of the
appointment or cessation of appointment.
Penalty: 20 penalty units.
10
249. Annual report
(1) A co-operative must send to the Registrar within
the required period in each year an annual report
containing each of the following--
(a) a list in the form approved by the Registrar
15
specifying the directors and the principal
executive officers of the co-operative and of
each subsidiary of the co-operative, as at the
date that the annual report is sent to the
Registrar;
20
(b) a copy of the accounts of the co-operative in
respect of its financial year then last past;
(c) a copy of the accounts of each subsidiary of
the co-operative in respect of the financial
year of the subsidiary then last past;
25
(d) a copy of any report by the auditors or
directors of the co-operative or subsidiary on
the accounts referred to in paragraphs (b) and
(c);
(e) such other particulars as may be prescribed.
30
Penalty: 20 penalty units.
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(2) For the purposes of sub-section (1) the required
period is --
(a) 28 days after the annual general meeting of
the co-operative; or
(b) if the annual general meeting of the co-
5
operative is not held within the period
specified in section 204(2)(a), 28 days after
the end of that period.
250. List of members to be furnished at request of
Registrar
10
A co-operative must, at the request in writing of
the Registrar, send to the Registrar, within the
time and in the manner that the Registrar specifies,
a full list of the members of the co-operative and
of each subsidiary of the co-operative, together
15
with the particulars with regard to those members
that the Registrar specifies in the request.
Penalty: 20 penalty units.
251. Special return to be furnished at request of Registrar
(1) The Registrar may by direction in writing require
20
a co-operative to furnish to the Registrar a special
return in the form, within the time, and relating to
the subject-matter, specified by the Registrar.
(2) The co-operative must comply with a direction
under sub-section (1).
25
Penalty: 20 penalty units.
Division 7--Name and registered office
252. Name to include certain matter
(1) The name of a co-operative may consist of words,
numbers or a combination of both.
30
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(2) The name of the co-operative must include the
word "Co-operative" or "Cooperative" or the
abbreviation "Co-op".
(3) The word "Limited'' or the abbreviation "Ltd''
must be the last word of the name.
5
(4) A body corporate which is formed or incorporated
under any Act other than this Act must not register
under that other Act by any name which includes
the word "Co-operative" or the abbreviation "Co-
op".
10
Penalty: 20 penalty units.
(5) Sub-section (4) does not apply to--
(a) a co-operative housing society within the
meaning of the Co-operative Housing
Societies Act 1958; or
15
(b) a credit union or foreign society within the
meaning of the Financial Institutions
(Victoria) Code; or
(c) a company or society formed or incorporated
under any other Act before the
20
commencement of the Co-operation Act
1953.
253. Use of abbreviations
A description of a co-operative is not inadequate
or incorrect merely because of one or more of the
25
following--
(a) the use of the abbreviation "Co-op" instead
of the word "Co-operative" or "Cooperative"
in the co-operative's name;
(b) the use of the abbreviation "Ltd'' instead of
30
the word "Limited'' in the co-operative's
name;
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(c) the use of the symbol "&'' instead of the
word "and'' in the co-operative's name;
(d) the use of any of those words instead of the
corresponding abbreviation or symbol in the
co-operative's name;
5
(e) the use of any abbreviation or elaboration of
the name of the co-operative that is approved
in a particular case or for a particular purpose
by the Registrar in writing.
254. Name to appear on business documents etc.
10
(1) The name of a co-operative must appear in legible
characters--
(a) on its seal; and
(b) in all notices, advertisements and other
official publications of the co-operative; and
15
(c) in all its business documents.
(2) If sub-section (1) is contravened, the co-operative
is guilty of an offence and liable to a penalty not
exceeding 20 penalty units.
(3) An officer of a co-operative or a person on its
20
behalf must not--
(a) use any seal of the co-operative; or
(b) issue or authorise the issue of any notice,
advertisement or other official publication of
the co-operative; or
25
(c) sign or authorise to be signed on behalf of
the co-operative any business document of
the co-operative--
in or on which the co-operative's name does not
appear in legible characters.
30
Penalty: 20 penalty units.
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(4) A director of a co-operative who knowingly
authorises or permits a contravention of this
section is guilty of an offence and liable to a
penalty not exceeding 20 penalty units.
(5) In this section--
5
"business document" in relation to a co-
operative, means a document that is issued,
signed or endorsed by or on behalf of the co-
operative and is--
(a) a business letter, statement of account,
10
invoice or order for goods or services;
or
(b) a bill of exchange, promissory note,
cheque or other negotiable instrument;
or
15
(c) a receipt or letter of credit issued by the
co-operative; or
(d) a document of a class prescribed as a
class of business documents.
255. Change of name of co-operative
20
(1) A co-operative may by special resolution change
its name to a name approved by the Registrar.
(2) A change of name must be advertised as
prescribed.
(3) A change of name does not take effect until--
25
(a) the Registrar has noted the change on the
certificate of registration of the co-operative;
or
(b) the certificate of registration is surrendered
to the Registrar and a replacement certificate
30
of registration is issued in the new name.
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(4) A change of name by a co-operative does not
affect--
(a) the identity of the co-operative; or
(b) the exercise of any rights, or the enforcement
of any obligations, by or against the co-
5
operative or any person; or
(c) the continuation of any legal proceedings by
or against the co-operative.
(5) Any legal proceedings that might have been
continued or commenced by or against the co-
10
operative in its former name may be continued or
commenced by or against the co-operative in its
new name.
(6) The Registrar may refuse to approve a change of
name if the Registrar thinks the new name is
15
undesirable.
(7) The Registrar may direct a co-operative to change
its name if the Registrar is of the opinion that the
name is such as is likely to be confused with the
name of a body corporate or a registered business
20
name.
256. Registered office of co-operative
(1) A co-operative must have a registered office.
Penalty: 20 penalty units.
(2) A co-operative must, at the premises of its
25
registered office, publicly and conspicuously
display a notice stating the name of the co-
operative and identifying the premises as its
registered office.
Penalty: 20 penalty units.
30
(3) Not later than 28 days after changing the address
of its registered office, a co-operative must give
the Registrar written notice of the new address.
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Penalty: 20 penalty units.
_______________
PART 10--FUNDS AND PROPERTY
Division 1--Power to raise money
257. Meaning of obtaining financial accommodation
5
A reference in this Division to the obtaining of
financial accommodation includes a reference to
the obtaining of credit and the borrowing or
raising of money by any means.
258. Fund raising to be in accordance with Act and
10
regulations
The regulations may impose requirements and
restrictions on the obtaining of financial
accommodation and the giving of security in
connection with the obtaining of financial
15
accommodation by a co-operative.
259. Limits on deposit taking
A co-operative must not accept money on deposit
unless--
(a) the co-operative was authorised by its rules
20
immediately before the commencement of
this Act to accept money on deposit; or
(b) the co-operative was a deposit-taking body
corporate immediately before it became a co-
operative and it is authorised by its rules to
25
accept money on deposit; or
(c) in the case of a merged co-operative, one or
more of the co-operatives involved in the
merger was a deposit-taking co-operative
immediately before the registration of the
30
merged co-operative and the merged co-
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operative is authorised by its rules to accept
money on deposit.
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260. Members etc. not required to see to application of
money
A member or other person from whom a co-
operative obtains financial accommodation is not
required to see to its application and is not
5
affected or prejudiced by the fact that in doing so
the co-operative contravened any provision of this
Act or the regulations or the rules of the co-
operative.
261. Registrar's directions re fundraising
10
(1) The Registrar may by written notice served on a
co-operative give a direction to the co-operative as
to the manner in which it is to exercise its
functions in connection with the activities of the
co-operative in obtaining financial
15
accommodation.
(2) A direction under sub-section (1) may make
provision for any one or more of the following
matters--
(a) requiring the co-operative to cease obtaining
20
financial accommodation or to cease
obtaining financial accommodation in a
particular way;
(b) requiring the co-operative to repay in
accordance with the direction all or part of
25
financial accommodation obtained;
(c) requiring the co-operative to re-finance in a
specified manner financial accommodation
repaid in accordance with the Registrar's
direction;
30
(d) the manner in which the co-operative is
permitted to invest or use the proceeds of
financial accommodation it obtains.
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262. Subordinated debt
(1) A co-operative may incur subordinated debt.
(2) Subordinated debt is debt incurred under an
agreement under which, in the event of the
winding up of the co-operative, any claim of the
5
creditor against the co-operative in respect of the
debt is to rank in priority--
(a) equally with the claim of any other creditor
who is a party to a similar agreement; and
(b) except as provided by paragraph (a), after the
10
claims of any other creditor of the co-
operative and before the claims of members
to repayment of any share capital in the co-
operative.
(3) An agreement referred to in sub-section (1) has
15
effect despite the provisions of Division 6 of Part
5.6 of the Corporations Law (as adopted under
Division 3 of Part 12 of this Act).
263. Application of Corporations Law to issues of
debentures
20
(1) The provisions of Parts 1.2A, 7.11 and 7.12 of the
Corporations Law are adopted by this section and
apply to and in respect of debentures of a co-
operative.
(2) Those provisions apply with any modifications
25
that are prescribed and as if--
(a) a co-operative were a company; and
(b) a reference in those provisions to a
corporation included a co-operative;
(c) a reference in those provisions to the
30
Commission were a reference to the
Registrar.
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(3) The provisions of the Corporations Law adopted
by this section do not apply to a loan to which
section 267 applies.
(4) The provisions of the Corporations Law adopted
by this section do not apply to an issue of
5
debentures of a co-operative which is made--
(a) solely to members; or
(b) solely to members and employees of the co-
operative; or
to a person who on becoming an inactive member
10
of the co-operative has had his or her share capital
converted to debt.
(5) Expressions used in this section which are not
defined in this Act have the same meaning as in
the Corporations Law.
15
(6) The Registrar may exempt a co-operative from
any of the requirements of the Corporations Law
adopted by this section.
264. Disclosure statement
(1) This section applies to the issue of debentures of a
20
co-operative where the issue is made--
(a) solely to members; or
(b) solely to members and employees of the co-
operative.
(2) Before issuing to the person debentures to which
25
this section applies, a co-operative must provide a
person with a disclosure statement, approved by
the Registrar, and containing such information as
is reasonably necessary to enable a person to make
an informed assessment of the financial prospects
30
of the co-operative, including--
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(a) the purpose for which the money raised by
the co-operative by the issue of debentures is
to be used;
(b) the rights and liabilities attaching to the
debentures;
5
(c) the financial position of the co-operative;
(d) the interests of the directors of the co-
operative in the issue of the debentures;
(e) any compensation or consideration to be paid
to officers or members of the co-operative in
10
connection with the issue of debentures; and
(f) such other matters as the Registrar directs.
(3) Sections 17 (except sub-section (2)) and 29 apply
to the approval of a disclosure statement under
this section with any necessary modifications and
15
in particular as if any reference in section 17 to a
formation meeting were a reference to the issue of
debentures.
265. Approval of board for transfer of debentures
A debenture of a co-operative cannot be sold or
20
transferred except with the consent of the board
and in accordance with the rules of the co-
operative.
266. Application of Corporations Law--re-issue of
redeemed debentures
25
Section 1051 of the Corporations Law is adopted
by this section and applies in relation to
debentures issued by a co-operative to any of its
members as if a co-operative were a company.
267. Compulsory loan by member to co-operative
30
(1) If the rules of the co-operative so provide, the co-
operative may require its members to lend money,
with or without security, to the co-operative, in
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accordance with a proposal approved by special
resolution of the co-operative.
(2) The proposal must not require a loan to be for a
term exceeding 7 years or such other term as is
prescribed.
5
(3) The proposal must--
(a) be accompanied by a disclosure statement,
approved by the Registrar, that explains the
purpose for which the money raised by the
co-operative pursuant to the proposal is to be
10
used and includes any other information that
the Registrar directs; and
(b) clearly show the total amount of the loan to
be raised by the co-operative and the basis on
which the money required to be lent by each
15
member is to be calculated; and
(c) be accompanied by a statement informing the
member that the member may inform the
board by notice on or before the date
specified in the statement (being a date
20
before the passing of the special resolution)
that the member resigns on the passing of the
special resolution.
(4) If the proposal so allows, the board of the co-
operative may, in accordance with the terms of the
25
proposal, deduct the money required to be lent by
a member to the co-operative from money due
from the co-operative to the member in respect of
his or her dealings with the co-operative.
(5) A proposal to deduct money referred to in sub-
30
section (4) must, in addition, clearly show--
(a) the basis on which the money is to be
deducted; and
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(b) the time and manner of making the
deductions.
(6) When approved the proposal is binding on--
(a) all members of the co-operative at the date of
passing of the special resolution other than a
5
member who has given a notice of
resignation in accordance with sub-section
(3)(c); and
(b) all persons who become members of the co-
operative after that date and before the total
10
amount of the loan to be raised pursuant to
the proposal has been raised.
(7) Sections 17 (except sub-section (2)) and 29 apply
to the approval of a disclosure statement under
this section with any necessary modifications and
15
in particular as if any reference in section 17 to a
formation meeting were a reference to the special
resolution.
268. Interest payable on compulsory loan
(1) The rate of interest payable by a co-operative in
20
respect of a loan under section 267 during any
period is--
(a) in the case of a co-operative with share
capital--
(i) the rate (or, if there is more than one
25
rate, at the higher or highest rate) of
dividend payable in respect of that
period on the share capital of the co-
operative; or
(ii) if the rate of dividend payable in respect
30
of that period has not been determined,
at the rate (or the higher or highest rate)
payable in respect of the immediately
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preceding period for which a rate has
been determined; or
(iii) if a rate of dividend has never been
determined in respect of the share
capital of the co-operative, at the rate
5
that the board of the co-operative
considers reasonable; or
(b) in the case of a co-operative without share
capital, at the rate that the board of the co-
operative considers reasonable; or
10
(c) if the rules provide for a rate to be payable
that is higher than the rate applicable under
paragraph (a) or (b), at that higher rate.
(2) A member may agree to the rate of interest being
less than that which would otherwise be payable
15
under this section and may agree to no interest
being paid.
Division 2--Charges
269. Registration of charges
Schedule 3 has effect but does not apply to--
20
(a) a mortgage, charge or encumbrance that is
over specific land and is registered under the
Transfer of Land Act 1958 or a
memorandum of which has been registered
under the Property Law Act 1958; or
25
(b) a mortgage, charge or encumbrance over a
specific licence under the laws relating to
mining.
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Division 3--Receivers and other controllers of property of
co-operatives
270. Receivers and other controllers of property of co-
operatives
Schedule 4 has effect.
5
Division 4--Disposal of surplus from activities
271. Retention of surplus for benefit of co-operative
The board of a co-operative may resolve to retain
all or any part of the surplus arising in any year
from the business of the co-operative to be applied
10
for the benefit of the co-operative.
272. Application for charitable purposes or members'
purposes
(1) The rules of a co-operative may authorise the co-
operative to apply a part of the surplus arising in
15
any year from the business of the co-operative for
any charitable purpose.
(2) The rules of a trading co-operative may authorise
the co-operative to apply a part of the surplus
arising in any year from the business of the co-
20
operative for supporting any activity approved by
the co-operative.
(3) The rules must limit the amount that may be
applied under sub-section (1) or (2) to a specified
proportion of the surplus.
25
(4) A co-operative may apply part of the surplus for a
purpose and to the extent authorised by rules
under sub-section (1) or (2).
273. Distribution of surplus or reserves to members
(1) The rules of a trading co-operative may authorise
30
the co-operative to apply a part of the surplus
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arising in any year from the business of the co-
operative or a part of the reserves of the co-
operative by--
(a) distribution to members as a rebate on the
basis of business done with the co-operative;
5
or
(b) the issue of bonus shares to members; or
(c) the issue to members of a limited dividend.
(2) The amount of any rebate or dividend payable to a
member under sub-section (1) may, with the
10
consent of the member, be applied--
(a) in payment for the issue to the member of
bonus shares; or
(b) as a loan to the co-operative.
(3) In this section "limited dividend" means a
15
dividend that does not exceed the prescribed
amount.
274. Application of surplus to other persons
(1) If authorised by its rules, any part of the surplus
arising in any year from the business of a trading
20
co-operative may be credited to any person who is
not a member, but is qualified to be a member, by
way of rebate in proportion to the business done
by him or her with the co-operative, if--
(a) the person was a member at the time the
25
business was done and the membership has
lapsed; or
(b) the person has applied for membership after
the business was done.
(2) Nothing in this section precludes the payment of a
30
bonus to an employee in accordance with the
terms of his or her employment.
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Division 5--Acquisition and disposal of assets
275. Acquisition and disposal of assets
(1) A co-operative must not do any of the following
things except as approved by special resolution by
means of a special postal ballot--
5
(a) sell or lease as a going concern, the
undertaking of the co-operative or a part of
the undertaking that relates to its primary
activities the value of which represents 5%
or more of the total value of the undertaking;
10
(b) acquire from or dispose to a director or
employee of the co-operative, or a relative
(within the meaning of the Corporations
Law) of such a director or employee or of the
spouse of such a director or employee, of any
15
property the value of which represents 5% or
more of the total value of all the assets of the
co-operative that relate to its primary
activities;
(c) acquire an asset the value of which exceeds
20
5% or more of the assets of the co-operative
if the acquisition would result in the co-
operative commencing to carry on an activity
that is not one of its primary activities;
(d) dispose of an asset if the disposal would
25
result in the co-operative ceasing to carry on
any primary activity of the co-operative, or in
the ability of the co-operative to carry on any
primary activity of the co-operative being
substantially impaired either generally or in a
30
particular geographical region.
(2) The Registrar may by order in writing exempt a
co-operative from compliance with all or specified
provisions of this section and section 200 in
relation to any matter to which this section applies
35
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and may grant that exemption unconditionally or
subject to conditions.
(3) If a co-operative contravenes this section, each
person who is a member of the board of the co-
operative is guilty of an offence and liable to a
5
penalty not exceeding 60 penalty units unless the
person satisfies the court that he or she used all
due diligence to prevent the contravention by the
co-operative.
10 _______________
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PART 11--RESTRICTIONS ON THE ACQUISITION OF
INTERESTS IN CO-OPERATIVES
Division 1--Restrictions on share and voting interests
276. Application of Part
This Part applies to trading co-operatives.
5
277. Notice required to be given of voting interest
(1) A person (whether or not a member of the co-
operative) must give notice to a co-operative
within 5 business days after becoming aware that
the person has a relevant interest in the right to
10
vote of a member of the co-operative.
Penalty: 20 penalty units.
(2) A person (whether or not a member of the co-
operative) who has ceased to have a relevant
interest in the right to vote of a member of a co-
15
operative must give notice to the co-operative
within 5 business days after becoming aware of
that fact.
Penalty: 20 penalty units.
(3) Section 186 provides for the effect of a person
20
having a relevant interest in the right to vote of a
member of a co-operative.
278. Notice required to be given of substantial share
interest
(1) A person must give notice to a co-operative within
25
5 business days after becoming aware that the
person has a substantial share interest in the co-
operative.
Penalty: 20 penalty units.
(2) A person who has a substantial share interest in a
30
co-operative must give notice to the co-operative
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within 5 business days after becoming aware that a
substantial change has occurred in that share
interest.
Penalty: 20 penalty units
(3) A person who has ceased to have a substantial
5
share interest in a co-operative must give notice to
the co-operative within 5 business days after
becoming aware that the person has ceased to have
that interest.
Penalty: 20 penalty units.
10
(4) A person has a "substantial share interest'' in a co-
operative if the nominal value of the shares in the
co-operative in which the person has a relevant
interest represents 5% or more of the nominal
value of the issued share capital of the co-
15
operative.
(5) A "substantial change'' takes place in a person's
share interest in a co-operative if there is an
increase or decrease in the number of shares in the
co-operative in which the person has a relevant
20
interest and the increase or decrease represents at
least 1% of the nominal value of the issued share
capital of the co-operative.
279. Requirements for notices
A notice required under this Division must--
25
(a) be in the form approved by the Registrar; and
(b) specify the prescribed particulars of the
interest or change being notified.
280. Maximum permissible level of share interest
(1) A person must not have a relevant interest in
30
shares of a co-operative the nominal value of
which exceeds 20% of the nominal value of the
issued share capital of the co-operative.
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(2) The Registrar, by order published in the
Government Gazette, may specify a maximum
greater than 20% as the maximum for the
purposes of sub-section (1) in respect of a
particular person, a particular co-operative, a
5
particular class of co-operatives or co-operatives
generally.
(3) On the making of an order under sub-section (2)
the percentage is varied accordingly.
(4) The maximum of 20% specified by sub-section (1)
10
may be increased in respect of a particular person
by special resolution of the co-operative
concerned passed by means of a special postal
ballot.
(5) A resolution under sub-section (4) does not have
15
effect unless--
(a) it is approved by the Registrar; or
(b) the person concerned is another co-operative.
281. Shares to be forfeited to remedy contravention
(1) If a person has a relevant interest in a share of a
20
co-operative in contravention of this Division, the
board of the co-operative must declare to be
forfeited sufficient of the shares in which the
person has a relevant interest to remedy the
contravention.
25
(2) The shares to be forfeited are--
(a) the shares nominated by the person for the
purpose; or
(b) in the absence of such a nomination, the
shares in which the person has had a relevant
30
interest for the shortest time.
(3) A declaration of the board that shares are forfeited
operates to forfeit the shares concerned.
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(4) Sections 138 to 140 apply to and in respect of
shares forfeited under this section as if the shares
had been forfeited under Part 6.
282. Powers of board in response to suspected
contravention
5
(1) If the board of a co-operative is satisfied on
reasonable grounds that a person has contravened
section 277 in respect of the co-operative, the
board may do either or both of the following--
(a) refuse to register any share transfer involving
10
the person;
(b) suspend any specified rights or entitlements
that a person has as a member of the co-
operative or attaching to any shares of the co-
operative in which the person has a relevant
15
interest.
(2) The board may request a person who it suspects
has a relevant interest in any shares of the co-
operative to furnish specified information to the
board concerning that interest.
20
(3) A failure by a person to comply with a request
under sub-section (2) constitutes reasonable
grounds for being satisfied that the person has
contravened section 277.
283. Powers of Supreme Court with respect to
25
contravention
(1) If a person has contravened section 277 in respect
of a co-operative, the Supreme Court may, on the
application of the co-operative or the Registrar,
make any order or orders that it thinks just.
30
(2) Without limiting sub-section (1), the orders may
include--
(a) a remedial order; and
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(b) for the purpose of securing compliance with
any other order made under this section, an
order directing the co-operative or any other
person to do or refrain from doing a specified
act.
5
(3) An order may be made whether or not the
contravention continues.
(4) Proof to the satisfaction of the Supreme Court at
the hearing of an application that--
(a) a person has a relevant interest in a share of a
10
co-operative because an associate of the
person has a relevant interest in a share; and
(b) the associate became entitled to that relevant
interest within 6 months before the
application was filed with the Supreme
15
Court--
is evidence that the associate was an associate of
the person from the time the person first had the
relevant interest until the date of the hearing.
284. Co-operative to inform Registrar of interest over 20%
20
(1) A co-operative must inform the Registrar in
writing within 14 days after the board becomes
aware that--
(a) a particular person has a relevant interest in
shares of the co-operative the nominal value
25
of which exceeds 20% of the nominal value
of the issued share capital of the co-
operative; or
(b) there has been a change in the number of
shares in which such a person holds a
30
relevant interest.
(2) The notification must give details of the relevant
interest concerned or of the change concerned.
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285. Co-operative to keep register
(1) A co-operative must keep a register of notifiable
interests.
(2) The co-operative must enter in the register in
alphabetical order the names of persons from
5
whom the co-operative has received a notification
under this Division together with the information
contained in the notification.
(3) The register must be open for inspection--
(a) by any member of the co-operative free of
10
charge; and
(b) by any other person on payment of the fee (if
any) that the co-operative may require, not
exceeding the prescribed maximum fee.
286. Unlisted companies to provide list of shareholders etc.
15
(1) This section applies to a company (within the
meaning of the Corporations Law) that is not a
listed corporation (within the meaning of that
Law).
(2) A company to which this section applies that is a
20
member of a co-operative must furnish to the co-
operative a list showing--
(a) the name of each member of the company as
at the end of the financial year of the
company and the number of shares in the
25
company held by each member; and
(b) the name of each person who has a relevant
interest (within the meaning of the
Corporations Law) in any share of the
company together with details of that
30
interest; and
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(c) the name of each person who is an associate
(within the meaning of the Corporations
Law) of the company.
(3) A list under sub-section (2) must be furnished
within 28 days after the end of each financial year
5
of the company and within 28 days after a request
for the list is made in writing to the company by
the Registrar.
(4) The details to be shown on the list are those
details as at the end of the financial year
10
concerned or, if the list is provided at the request
of the Registrar, as at the date specified in the
request.
(5) The Registrar may make a request under sub-
section (3) at any time but only if the Registrar is
15
of the opinion that the company is or may be
involved in a suspected contravention of a
provision of this Division.
287. Excess share interest not to affect loan liability
(1) This section applies if a co-operative has made a
20
loan to a member and the member had or has a
relevant interest in shares of the co-operative in
contravention of this Division.
(2) Until the amount lent to the member has been
repaid to the co-operative (with any interest
25
payable), the member is liable to make to the co-
operative the payments which the member would
be liable to make if all the shares concerned were
lawfully held by the member.
(3) Any security for the repayment of the loan is not
30
affected by a contravention of this Division.
288. Extent of operation of Division
This Division--
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(a) applies to all natural persons, whether
resident in Victoria or in Australia or not and
whether Australian citizens or not, and to all
bodies corporate or unincorporated, whether
incorporated or carrying on business in the
5
State or in Australia or not; and
(b) extends to acts done or omitted to be done
outside the State, whether in Australia or not.
289. Registrar may grant exemption from Division
(1) The Registrar may grant exemptions from the
10
operation of this Division in a particular case or
class of cases.
(2) An exemption must be in writing and may be
unconditional or subject to conditions.
Division 2--Restrictions on certain share offers
15
290. Share offers to which Division applies
(1) This Division applies to the following offers to
purchase shares in a co-operative--
(a) an offer made as part of a proposal for, or
that is conditional on, the sale of the
20
undertaking or any part of the undertaking, as
a going concern, of the co-operative;
(b) an offer made as part of a proposal for, or
that is conditional on, the registration of the
co-operative as a company under the
25
Corporations Law;
(c) an offer made as part of a proposal for, or
that is conditional on, the winding-up of the
co-operative;
(d) an offer that would result in a contravention
30
of section 280 were the offeror to be
registered (immediately after the offer is
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made) as the holder of the shares that are the
subject of the offer;
(e) an offer that would lead to the offeror having
a substantial share interest in the co-
operative, or to a substantial change taking
5
place in a substantial share interest that the
offeror has in the co-operative, were the
offeror to be registered (immediately after
the offer is made) as the holder of the shares
that are the subject of the offer.
10
(2) In sub-section (1)(e), "substantial share interest''
and "substantial change'' have the same meanings
as they have in section 278.
291. Requirements to be satisfied before offer can be made
(1) A person must not make an offer to which this
15
Division applies unless the making of the offer has
been approved--
(a) by special resolution by means of a special
postal ballot; and
(b) by the Registrar.
20
(2) Despite sub-section (1), an offer referred to in
section 290(1)(e) can be made even if it has not
been approved as referred to in that sub-section if
it is made in circumstances specified in and in
accordance with the requirements of the
25
regulations.
292. Some offers totally prohibited if they discriminate
An offer referred to in section 290(1)(a) to (d)
must not be made at all if it operates or would
operate to discriminate between members who are
30
active members and members who are not active
members.
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293. Offers to be submitted to board first
(1) Any proposal to make an offer to which this
Division applies must in the first instance be
submitted to the board of the co-operative.
(2) The board may decline to put a proposed offer to a
5
special postal ballot unless arrangements
satisfactory to the board have been made for
payment to the co-operative of the expenses
involved in holding the ballot.
(3) The board may require payment in advance under
10
sub-section (2).
(4) A requisition for a special postal ballot for the
purposes of this Division cannot be served unless
and until the board has had a reasonable
opportunity to consider the proposed offer
15
concerned.
(5) A period of 28 days is to be considered to
constitute a reasonable opportunity for considering
a proposed offer but the Registrar may extend that
period in a particular case by written notice to the
20
co-operative.
294. Announcements of proposed takeovers concerning
proposed company
(1) This section applies to an offer to purchase shares
in a co-operative made as part of a proposal for, or
25
that is conditional on, the registration of the co-
operative as a company ("the proposed company'')
under the Corporations Law.
(2) A person must not make a public announcement to
the effect that the person proposes, or that the
30
person and another person or other persons
together propose, to make takeover offers, or to
cause a takeover announcement to be made, in
relation to the proposed company if--
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(a) the person knows that the announcement is
false or is recklessly indifferent as to whether
it is true or false; or
(b) the person has no reasonable grounds for
believing that the person, or the person and
5
the other person or persons, will be able to
perform obligations arising under the scheme
or announcement or under the Corporations
Law in connection with the scheme or
announcement if a substantial proportion of
10
the offers or the offers made under the
announcement are accepted.
Penalty: 200 penalty units or imprisonment for
5 years, or both.
(3) If a person makes a public announcement to the
15
effect that the person proposes, or that the person
and another person or other persons together
propose, to make a takeover bid in relation to the
proposed company, the person must proceed to
make a takeover bid in relation to shares in the
20
company in accordance with the public
announcement within 2 months after the day on
which the company is incorporated.
Penalty: 100 penalty units or imprisonment for
2 years, or both.
25
(4) A person is not liable to be convicted of more than
one offence under sub-section (3) in respect of any
one public announcement.
(5) A person who contravenes this section (whether or
not the person is convicted of an offence for the
30
contravention) is liable to pay compensation to
any other person who suffered loss as a result of
entering into a transaction with respect to shares in
reliance on the public announcement concerned.
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(6) The amount of that compensation is the difference
between the price of the shares at which the
transaction was entered into and the price of the
shares at which the transaction would have been
likely to have been entered into if the person had
5
not made the public announcement.
(7) A person is not guilty of an offence for a
contravention of sub-section (3) and is not liable
to pay compensation in respect of the
contravention if it is proved that the person could
10
not reasonably have been expected to make the
takeover bid concerned--
(a) as a result of circumstances that existed at
the time of the making of the public
announcement but of which the person had
15
no knowledge and could not reasonably have
been expected to have knowledge; or
(b) as a result of a change in circumstances after
the making of the announcement, other than
a change in circumstances caused directly or
20
indirectly by the person.
(8) Expressions used in this section have the same
meanings as in section 746 of the Corporations
Law.
295. Additional disclosure requirements for offers
25
involving conversion to company
If an offer is part of a proposal for, or is
conditional on, the registration of the co-operative
as a company under the Corporations Law, the
disclosure statement required to be sent to
30
members for the purposes of the special postal
ballot must contain the following additional
information--
(a) full particulars of any proposal whereby any
of the directors will acquire a relevant
35
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interest in any share of the company to be
formed;
(b) any other information that is material to the
making of a decision by a member whether
or not to agree to the making of the offer,
5
being information that is within the
knowledge of the directors and has not
previously been disclosed to the members;
(c) any other information that the Registrar
directs.
10
296. Consequences of prohibited offer
(1) If a person makes an offer to purchase shares in a
co-operative in contravention of this Division--
(a) the person is not entitled to be registered as
the holder of the shares concerned; and
15
(b) if the transfer of the shares is registered, the
person is not entitled to vote at any meeting
of the co-operative.
(2) Any vote cast by or on behalf of a member when
the member is not entitled to vote because of the
20
operation of this section is to be disregarded.
297. Registrar may grant exemptions
The Registrar may, by order in writing, exempt a
co-operative from compliance with all or specified
provisions of this Division and section 200 in
25
relation to any matter to which this Division
applies and may grant such an exemption
unconditionally or subject to conditions.
_______________
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PART 12--MERGER, TRANSFER OF ENGAGEMENTS,
WINDING UP
Division 1--Mergers and transfers of engagements
298. Application of Division
This Division does not apply to a merger or
5
transfer of engagements to which Part 14 applies.
299. Mergers and transfers of engagements of local co-
operatives
Any 2 or more co-operatives may consolidate all
or any of their assets liabilities and undertakings
10
by way of merger or transfer of engagements
approved under this Division.
300. Requirements before application can be made
(1) Before co-operatives can apply for approval under
this Division of a merger or transfer of
15
engagements, the proposed merger or transfer
must have been approved by each of the co-
operatives by--
(a) a special resolution passed by means of a
special postal ballot; or
20
(b) (if permitted by sub-section (2)) a resolution
of the board of the co-operative.
(2) The proposed merger or transfer of engagements
may be approved by resolution of the board of a
co-operative if the Registrar consents to that
25
procedure applying in the particular case.
301. Disclosure statement required
(1) A resolution of a co-operative is not effective for
the purposes of this Division unless this section
has been complied with.
30
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(2) Each co-operative must send to each of its
members a disclosure statement approved by the
Registrar specifying--
(a) the financial position of the each co-
operative concerned in the proposed merger
5
or transfer of engagements as shown in
financial statements that have been prepared
as at a date that is not more than 6 months
before the date of the statement; and
(b) any interest that any officer of each co-
10
operative has in the proposed merger or
transfer of engagements; and
(c) any compensation or other consideration
proposed to be paid, or any other incentive
proposed to be given, to any officer or
15
member of each co-operative in relation to
the proposed merger or transfer of
engagements; and
(d) whether the proposal is a merger or transfer
of engagements and the reason for the
20
merger or transfer or engagements; and
(e) in the case of a transfer of engagements,
whether it is a total or partial transfer of
engagements; and
(f) any other information that the Registrar
25
directs.
(3) The disclosure statement must be sent to the
members of each co-operative so that it will be in
the ordinary course of post reach each member
who is entitled to vote on the special resolution
30
not later 21 days before the day on or before
which the ballot papers must be returned by
members voting in the special postal ballot.
(4) The Registrar may exempt a co-operative from
complying with this section.
35
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(5) The Registrar may grant an exemption, or approve
a disclosure statement, subject to any conditions
he or she considers appropriate.
302. Making an application
(1) An application for approval of a merger or transfer
5
of engagements under this Division must be made
to the Registrar in the manner and form required
by the Registrar.
(2) An application for approval of a merger must be
accompanied by 2 copies of the proposed rules of
10
the merged co-operative and any other particulars
required by the Registrar.
303. Approval of merger
(1) The Registrar must approve a merger pursuant to
an application under this Division if satisfied
15
that--
(a) this Division has been complied with in
relation to the application; and
(b) the proposed rules of the merged co-
operative are consistent with this Act and the
20
regulations and are such that may reasonably
be approved; and
(c) the certificates of registration of the co-
operatives have been surrendered to the
Registrar; and
25
(d) there is no good reason why the merged co-
operative and its rules should not be
registered.
(2) On approving an application for merger, the
Registrar must--
30
(a) cancel the registration of the co-operatives
involved in the merger, and
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(b) register the merged co-operative and its
rules; and
(c) issue to the merged co-operative a certificate
of registration under this Act.
(3) A merger takes effect on the issue of the
5
certificate of registration for the merged co-
operative.
304. Approval of transfer of engagements
(1) The Registrar must approve a transfer of
engagements pursuant to an application under this
10
Division if satisfied that--
(a) this Division has been complied with in
relation to the application; and
(b) the rules or proposed rules of the transferee
co-operative are adequate; and
15
(c) in the case of a total transfer of engagements
from a co-operative, the certificate of
registration of the co-operative has been
surrendered to the Registrar; and
(d) there is no good reason why the transfer of
20
engagements should not take effect.
(2) A transfer of engagements takes effect on the day
specified in the approval of the Registrar.
305. Transfer of engagements by direction of Registrar
(1) The Registrar may, with the approval of the
25
Minister, direct a co-operative--
(a) to transfer its engagements to a co-operative
approved by the Registrar; and
(b) within a period specified by the Registrar
when giving the direction or within such
30
further period as the Registrar may allow, to
enter into an agreement approved by the
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Registrar to give effect to the transfer of
engagements directed.
(2) The Registrar must not give such a direction to a
co-operative unless the necessary grounds exist for
the giving of the direction, as referred to in section
5
336.
(3) The transfer of engagements must make provision
in a manner approved by the Registrar for those
members of the transferor co-operative who wish
to do so to become members of the transferee co-
10
operative.
(4) If a co-operative fails to comply with a direction
under this section, the Registrar may elect to treat
the failure as the necessary grounds--
(a) for the winding up of the co-operative on a
15
certificate of the Registrar; or
(b) for the appointing of an administrator of the
co-operative.
(5) The Registrar must notify the co-operative of the
Registrar's decision under sub-section (4).
20
(6) The Registrar may revoke a direction under this
section at any time up until the co-operative has
agreed pursuant to the direction to transfer its
engagements.
(7) A transfer of engagements directed under this
25
section takes effect on a day notified by the
Registrar in the Government Gazette.
(8) An officer of a co-operative who--
(a) fails to take all reasonable steps to secure
compliance by the co-operative with a
30
direction given under this section; or
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(b) by a wilful act or omission is the cause of a
failure by the co-operative to comply with
such a direction--
is guilty of an offence and liable to a penalty not
exceeding 20 penalty units.
5
Division 2--Transfer of incorporation
306. Application for transfer
A co-operative, if approved under this Division,
may apply to become registered or incorporated as
one of the following bodies corporate--
10
(a) a company under the Corporations Law;
(b) an incorporated association under the
Associations Incorporation Act 1981;
(c) a building society under the Financial
Institutions (Victoria) Code;
15
(d) a credit union under the Financial
Institutions (Victoria) Code;
(e) a friendly society under the Friendly
Societies Act 1986;
(f) a co-operative housing society under the Co-
20
operative Housing Societies Act 1958;
(g) any body corporate that is incorporated,
registered or otherwise established under a
law that is a law of a place outside the State
and that is prescribed for the purposes of this
25
section.
307. Requirements before application can be made
(1) Before an application is made under section 306,
the co-operative must by special resolution passed
by means of a special postal ballot--
30
(a) approve the proposed application; and
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(b) determine under what name the co-operative
is to apply to be incorporated or registered;
and
(c) adopt any memorandum or articles of
association or rules that may be necessary or
5
considered desirable.
(2) The name applied for need not be the same as that
of the co-operative and must not include the word
"co-operative'' or any other word importing a
similar meaning.
10
(3) The Registrar may, by order, exempt a co-
operative from compliance with all or specified
provisions of this section and section 200 in
relation to any matter to which this section
applies.
15
(4) An exemption under sub-section (3) may be
granted unconditionally or subject to conditions.
308. Meaning of "new body'' and "transfer''
The registration or incorporation of a co-
operative as a body corporate as a result of an
20
application under this Division is referred to in
this Division as its "transfer'' and the body
corporate concerned is referred to in this Division
as "the new body''.
309. New body ceases to be registered as co-operative
25
On the transfer of a co-operative under this
Division, it ceases to be registered as a co-
operative under this Act.
310. Transfer not to impose greater liability etc.
(1) Any memorandum or articles of association or
30
rules adopted for the purposes of the transfer must
not be such as to--
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(a) impose on the members of the new body who
were members of the co-operative at the date
of transfer any greater or different liability to
contribute to the assets of the new body than
the liability to which they were subject as
5
members of the co-operative; or
(b) deprive any member of the new body of any
preferential rights with respect to dividend or
capital to which the member was entitled as a
member of the co-operative at the date of
10
transfer.
(2) The transfer must result in all persons who were
members of the co-operative at the date of transfer
becoming members of the new body.
(3) In the case of a transfer of a co-operative that has a
15
share capital to a new body that has a share
capital, the transfer must result in every member
of the co-operative at the date of transfer who held
shares in the co-operative being the holder of
shares in the capital of the new body equal in
20
number and nominal value to the shares held by
the member as a member of the co-operative.
311. Effect of new certificate of registration
A certificate of registration or incorporation as
the new body issued by the appropriate officer
25
under the law applicable to the new body is
conclusive evidence that all the requirements of
this Division in respect of that registration or
incorporation have been complied with.
312. New body is a continuation of the co-operative
30
(1) When a co-operative transfers to a new body, the
body corporate constituted by the new body is to
be considered to be the same entity as the body
corporate constituted by the co-operative.
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(2) Without limiting sub-section (1), Division 6
applies to a transfer under this Division.
313. Stamp duty
(1) This section applies when a co-operative that
transfers under this Division was before its
5
registration as a co-operative under this Act a
company under the Corporations Law or any
corresponding previous law of the State and stamp
duty had been paid on its incorporation as such a
company in respect of the amount of the nominal
10
capital of the company (or if subsequently
increased on the amount of its nominal capital as
so increased).
(2) Any stamp duty so paid is to be taken into account
and included in assessing the stamp duty payable
15
on its incorporation or registration pursuant to the
transfer.
Division 3--Winding up
314. Methods of winding up
(1) A co-operative may be wound up voluntarily or by
20
the Supreme Court or on a certificate of the
Registrar.
(2) In the case of a winding up voluntarily or by the
Supreme Court, the co-operative may be wound
up in the same manner and in the same
25
circumstances as a company under the
Corporations Law may be so wound up.
315. Winding up on Registrar's certificate
(1) A co-operative may be wound up on a certificate
of the Registrar only if the necessary grounds for
30
the taking of that action exist, as referred to in
section 336.
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(2) A winding up on a certificate of the Registrar
commences when the certificate is given.
(3) On the giving of a certificate, the Registrar may
appoint a person to be the liquidator of the co-
operative.
5
(4) The liquidator need not be a registered liquidator
under the Corporations Law.
(5) The liquidator must within 10 days after
appointment give notice of his or her appointment
in the Government Gazette.
10
(6) The liquidator must give such security as may be
prescribed and is entitled to receive such fees as
are fixed by the Registrar.
(7) Any vacancy occurring in the office of liquidator
is to be filled by a person appointed by the
15
Registrar.
316. Application of Corporations Law to winding up
(1) The provisions of Parts 5.4 to 5.7 of the
Corporations Law with respect to the winding up
or dissolution of a company under that Law are
20
adopted by this section and apply to the winding
up or dissolution of a co-operative.
(2) For the purposes of the application of those
provisions to a winding up on the certificate of the
Registrar, the winding up is to be considered to be
25
a voluntary winding up (but section 490 of the
Corporations Law does not apply).
(3) Provisions of the Corporations Law are adopted
with any modifications that are prescribed and as
if--
30
(a) a reference in any of those provisions to a
special resolution or an extraordinary
resolution were a reference to a special
resolution within the meaning of this Act;
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(b) a reference in any of those provisions to the
Commission were as a reference to the
Registrar;
(c) section 513B were amended by inserting
after paragraph (d)--
5
"(da) if the winding up is on the certificate of
the Registrar--on the date that the
certificate is given; or"
(d) section 516 were amended by inserting after
the words "past member'' the words "together
10
with any charges payable by him or her to the
co-operative in accordance with the rules'';
(e) a reference in section 461 to a proprietary
company were reference to an association or
federation;
15
(f) a reference to a registered liquidator included
a reference to a person approved by the
Registrar as a liquidator of a co-operative;
(g) a reference in any of those provisions to
section 260 of the Corporations Law were a
20
reference to Division 5 of Part 4 of this Act.
(4) The provisions of the Corporations Law adopted
by this section are to be read subject to sections 76
and 322 for the purposes of determining the
liability of members and former members to
25
contribute on a winding up of a co-operative.
317. Restrictions on voluntary winding up
(1) A co-operative may be wound up voluntarily
only--
(a) by a creditors' voluntary winding up; or
30
(b) if a special resolution is passed by means of a
special postal ballot in favour of voluntary
winding up.
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(2) The Registrar may by order exempt a co-operative
from compliance with all or specified provisions
of this section or section 200.
(3) An exemption under sub-section (2) may be
granted either unconditionally or subject to
5
conditions.
(4) When a special postal ballot is held, the members
may, by means of the same ballot, by simple
majority--
(a) appoint one or more liquidators for the
10
purpose of winding up the affairs and
distributing the assets of the co-operative;
and
(b) fix the remuneration to be paid to the
liquidator.
15
318. Commencement of members' voluntary winding up
A members' voluntary winding up of a co-
operative commences when the result of the
special postal ballot is noted in the minute book
by the secretary of the co-operative.
20
319. Distribution of surplus--non-trading co-operatives
(1) On a winding up of a non-trading co-operative, the
surplus property of the co-operative must be
distributed as required by the rules of the co-
operative.
25
(2) The rules of a non-trading co-operative must make
provision for the manner in which the surplus
property of the co-operative is to be distributed in
a winding up.
(3) In this section--
30
"surplus property'' means that property of the
co-operative that remains after satisfaction of
the debts and liabilities of the co-operative
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and the costs, charges and expenses of the
winding up.
320. Liquidator--vacancy may be filled by Registrar
If a co-operative is being wound up voluntarily
and a vacancy occurs in the office of liquidator
5
which in the opinion of the Registrar is unlikely to
be filled in the manner provided by the
Corporations Law, the Registrar may appoint a
person to be liquidator.
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321. Review of liquidator's remuneration
Any member or creditor of a co-operative or the
liquidator may at any time before the completion
of the winding up of the co-operative apply to the
Supreme Court to review the amount of the
5
remuneration of the liquidator.
322. Liability of member to contribute in a winding up
where shares forfeited etc.
(1) If a person's membership of a co-operative is
cancelled under Part 6 within 2 years before the
10
commencement of the winding up of the co-
operative, the person is liable on the winding up to
contribute to the property of the co-operative the
nominal value of any shares forfeited in
connection with that cancellation (being their
15
nominal value immediately before cancellation).
(2) If under section 176 a co-operative--
(a) purchases any share of a member in the co-
operative; or
(b) repays to a member the whole or any part of
20
the amount paid up on any share held by a
member--
within 2 years before the commencement of the
winding up of the co-operative, the member or
former member is liable on the winding up to
25
contribute to the property of the co-operative the
amount which was paid by the co-operative to the
member or former member in respect of the
purchase or repayment together with any amount
unpaid on those shares immediately before the
30
purchase or repayment.
(3) If a person contributes to the property of a co-
operative pursuant to a liability under this section,
the amount contributed is, for the purposes of the
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winding up concerned, to be treated as having
been paid up by the person on shares of the co-
operative.
(4) The liability of a member or former member of a
co-operative under this section is in addition to
5
any other liability of the member or former
member to contribute to the property of the co-
operative on a winding up of the co-operative.
Division 4--Administration of co-operative--adoption of
Corporations Law
10
323. Adoption of Part 5.3A of Corporations Law
(1) The provisions of Part 5.3A and Division 3 of Part
5.9 of the Corporations Law are adopted by this
section and apply to and in respect of a co-
operative as if it were a company.
15
(2) Those provisions apply with any modifications
that are prescribed and as if--
(a) references in those provisions to sections 164
and 166 of the Corporations Law were
references to sections 43 to 45 and 47 of this
20
Act; and
(b) references in those provisions to the
Commission were references to the
Registrar.
Division 5--Appointment of administrator
25
324. Appointment of administrator
(1) The Registrar may, by written notice, appoint an
administrator to conduct the affairs of a co-
operative.
(2) A notice of appointment must specify--
30
(a) the date of appointment; and
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(b) the appointee's name; and
(c) the appointee's business address.
(3) If the appointee's name or business address
changes, the appointee must immediately give
written notice of the change to the Registrar.
5
(4) The Registrar must not appoint an administrator
unless the necessary grounds for the taking of that
action exist, as referred to in section 336.
325. Effect of appointment of administrator
(1) On the appointment of an administrator of a co-
10
operative--
(a) the directors of the co-operative cease to
hold office; and
(b) all contracts of employment with the co-
operative are terminated; and
15
(c) all contracts for the provision of secretarial
or administrative services for the co-
operative are terminated; and
(d) the administrator may terminate any contract
for providing other services to the co-
20
operative.
(2) An administrator of a co-operative has the
functions of the board of the co-operative,
including the board's powers of delegation.
(3) A director of a co-operative must not be appointed
25
or elected while the administrator is in office
except as provided by this Division.
326. Revocation of appointment
(1) An administrator holds office until the
administrator's appointment is revoked.
30
(2) The Registrar may, by written notice, revoke the
appointment of an administrator.
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(3) When a liquidator of a co-operative is appointed,
the appointment of any administrator of the co-
operative is automatically revoked.
(4) Immediately on the revocation of an
administrator's appointment, the administrator
5
must prepare and submit a report to the Registrar
showing how the administration was carried out,
and for that purpose an administrator has access to
the co-operative's records and documents.
(5) On providing the report and accounting fully in
10
relation to the administration of the co-operative
to the satisfaction of the Registrar, the
administrator is released from any further duty to
account in relation to the administration of the co-
operative other than on account of fraud,
15
dishonesty, negligence or wilful failure to comply
with this Act or the regulations.
(6) Before revoking the appointment of an
administrator of a co-operative, the Registrar
must--
20
(a) appoint another administrator; or
(b) appoint a liquidator; or
(c) ensure that directors of the co-operative have
been elected in accordance with the rules of
the co-operative at a meeting convened by
25
the administrator in accordance with those
rules; or
(d) appoint directors of the co-operative.
(7) Directors elected or appointed under sub-section
(6)--
30
(a) take office on revocation of the
administrator's appointment; and
(b) in the case of directors appointed under sub-
section (6), hold office until the next annual
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general meeting of the co-operative after the
revocation of that appointment.
327. Expenses of administration
(1) The expenses of and incidental to the conduct of a
co-operative's affairs by an administrator are
5
payable from the co-operative's funds.
(2) The expenses of conducting a co-operative's
affairs include--
(a) if the administrator is not an officer or
employee of the public service, remuneration
10
of the administrator at a rate approved by the
Registrar; or
(b) if the administrator is an officer or employee
of the public service, the amount that the
Registrar certifies should be paid to it as
15
repayment of the administrator's
remuneration.
(3) An amount certified under sub-section (2)(b) may
be recovered in a court of competent jurisdiction
as a debt due to the Crown.
20
(4) An administrator has, in relation to the expenses
specified in sub-section (1), the same priority on
the winding-up of a co-operative as the liquidator
of the co-operative has.
328. Liabilities arising from administration
25
(1) If a co-operative incurs any loss because of any
fraud, dishonesty, negligence or wilful failure to
comply with this Act or the regulations or the
rules of the co-operative by an administrator, the
administrator is liable for the loss.
30
(2) An administrator is not liable for any loss that is
not a loss to which sub-section (1) applies but
must account for the loss in a report given under
section 326.
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329. Additional powers of Registrar
(1) If the Registrar appoints directors of a co-
operative under section 326, the Registrar may, by
written notice given to the co-operative, specify--
(a) a time during which this section is to apply
5
in relation to the co-operative; and
(b) the terms and conditions on which all or any
of the directors hold office; and
(c) the rules that are to be the co-operative's
rules.
10
(2) While this section applies to a co-operative, the
Registrar may--
(a) from time to time remove and appoint
directors; and
(b) from time to time, vary, revoke or specify
15
new terms and conditions in place of all or
any of the terms and conditions specified
under sub-section (1); and
(c) amend all or any of the rules specified under
sub-section (1).
20
(3) The Registrar may, by written notice given to the
co-operative, extend the time for which this
section is to apply in relation to a co-operative.
(4) A rule specified by the Registrar under this section
as a rule of a co-operative--
25
(a) is not to be altered except in the way set out
in this section; and
(b) if it is inconsistent with any other rule of the
co-operative, prevails over the other rule, and
the other rule is to the extent of the
30
inconsistency invalid; and
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(c) has the same evidentiary value as is by this
Act accorded to the co-operative's rules and
to copies of them.
330. Stay of proceedings
(1) If the Registrar appoints an administrator to
5
conduct a co-operative's affairs, a person must not
begin or continue any proceeding in a court
against the co-operative until the administrator's
appointment is revoked except with the leave of
the Supreme Court and, if the Supreme Court
10
grants leave, in accordance with any terms and
conditions that the Supreme Court imposes.
(2) A person intending to apply for leave of the
Supreme Court under sub-section (1) must give
the Registrar not less than 10 days notice of
15
intention to apply.
(3) On the hearing of an application under sub-section
(1), the Registrar may be represented and may
oppose the granting of the application.
331. Administrator to report to Registrar
20
On the receipt of a request from the Registrar, the
administrator of a co-operative must, without
delay, prepare and give to the Registrar a report
showing how the administration is being carried
out.
25
Division 6--Effect of merger etc. on property, liabilities etc.
332. How this Division applies to a merger
(1) This Division applies to a merger of co-operatives
under this Part.
(2) In the application of this Division to a merger--
30
"new body'' means the co-operative that results
from the merger;
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"original body'' means each co-operative that is a
party to the merger;
"relevant day'' means the day on which the
merged co-operative is registered under this
Act.
5
333. How this Division applies to a transfer of
engagements
(1) This Division applies to a transfer of the
engagements of a co-operative to another co-
operative under Division 1.
10
(2) In the application of this Division to a transfer of
engagements--
"new body'' means the co-operative to which the
engagements are transferred;
"original body'' means the co-operative that
15
transfers its engagements;
"relevant day'' means the day on which the
transfer of engagements takes effect.
334. How this Division applies to a transfer of
incorporation
20
(1) This Division applies to a transfer of incorporation
under Division 2.
(2) In the application of this Division to such a
transfer--
"new body'' means the body corporate that
25
results from the transfer;
"original body'' means the co-operative that
transfers its incorporation;
"relevant day'' means the day on which the
transfer takes effect.
30
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335. Effect of merger etc on property, liabilities etc.
(1) In this section--
"assets" means any legal or equitable estate or
interest (whether present or future and
whether vested or contingent) in real or
5
personal property of any description
(including money), and includes securities,
choses in action and documents;
"instrument" means an instrument (other than
this Act) which creates, modifies or
10
extinguishes rights or liabilities (or would do
so if lodged, filed or registered in accordance
with any law), and includes any judgment,
order and process of a court;
"liabilities" means liabilities, debts and
15
obligations (whether present or future and
whether vested or contingent).
(2) On and from the relevant day for an event to
which this Division applies--
(a) the assets of the original body vest in the new
20
body without the need for any conveyance,
transfer, assignment or assurance; and
(b) the rights and liabilities of the original body
become the rights and liabilities of the new
body; and
25
(c) all proceedings by or against the original
body that are pending immediately before the
relevant day are taken to be proceedings
pending by or against the new body; and
(d) any act, matter or thing done or omitted to be
30
done by, to or in respect of the original body
before the relevant day is (to the extent to
which that act, matter or thing has any force
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or effect) taken to have been done or omitted
by, to or in respect of the new body; and
(e) a reference in an instrument or in any
document of any kind to the original body is
to be read as, or as including, a reference to
5
the new body.
(3) The operation of this section is not to be
regarded--
(a) as a breach of contract or confidence or
otherwise as a civil wrong; or
10
(b) as a breach of any contractual provision
prohibiting, restricting or regulating the
assignment or transfer of assets, rights or
liabilities; or
(c) as giving rise to any remedy by a party to an
15
instrument, or as causing or permitting the
termination of any instrument, because of a
change in the beneficial or legal ownership
of any asset, right or liability.
(4) A document or an instrument executed or
20
registered for or with respect to a transfer of any
property to give effect to this section is not liable
to stamp duty or to any fee chargeable under any
Act for registration.
Division 7--Miscellaneous
25
336. Grounds for winding up, transfer of engagements,
appointment of administrator
(1) This section applies to the following actions--
(a) a direction by the Registrar to a co-operative
to transfer its engagements under section
30
305;
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(b) the appointment of an administrator of a co-
operative under Division 5;
(c) the winding up of a co-operative on a
certificate of the Registrar under section 315.
(2) The necessary grounds for the taking of action to
5
which this section applies exist if the Registrar
certifies--
(a) that the number of members is reduced to
less than the minimum number of persons
allowed, as referred to in section 74; or
10
(b) that the co-operative has not commenced
business within 1 year of registration or has
suspended business for a period of more than
6 months; or
(c) that the registration of the co-operative has
15
been obtained by mistake or fraud; or
(d) that the co-operative exists for an illegal
purpose; or
(e) that the co-operative has wilfully and after
notice from the Registrar violated the
20
provisions of this Act or of the regulations or
of the rules of the co-operative; or
(f) that the board of the co-operative has, after
notice from the Registrar, failed to ensure
that the rules of the co-operative contain
25
active membership provisions in accordance
with Part 6; or
(g) that there are, and have been for a period of
one month immediately before the date of the
Registrar's certificate, insufficient directors
30
of the co-operative to constitute a quorum as
provided by the rules of the co-operative; or
(h) following an inquiry pursuant to the
provisions of this Act into the affairs of a co-
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operative or the working and financial
condition of a co-operative, that in the
interests of members or creditors of the co-
operative or the public the action concerned
should be taken.
5
(3) Alternatively, the necessary grounds for the
winding up of a co-operative on a certificate of the
Registrar exist if the Registrar certifies--
(a) that the period, if any, fixed for the duration
of the co-operative by its rules has expired;
10
or
(b) that an event (to be specified in the
certificate) has occurred on the occurrence of
which the regulations or the rules provide
that the co-operative is to be wound up.
15
(4) The Registrar must not certify under this section
as to any matter unless the matter has been proved
to the Registrar's satisfaction.
337. Adoption of Corporations law concerning reciprocity
with other jurisdictions
20
(1) The provisions of Part 5.7A of the Corporations
Law are adopted by this section and apply to and
in respect of a co-operative in the same way as
they apply to an in respect of a company.
(2) Those provisions apply--
25
(a) with any modifications that are prescribed;
and
(b) as if--
(i) a reference in those provisions to a
recognised company were a reference to
30
a foreign co-operative; and
(ii) a reference to a provision of the
Corporations Law of another
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jurisdiction were a reference to that
provision as applying to a foreign co-
operative under a law of another
jurisdiction under which that foreign
co-operative is incorporated.
5
338. Adoption of Corporations Law concerning insolvent
co-operatives
(1) The provisions of Part 5.7B (except section 588G)
of the Corporations Law are adopted by this
section and apply to and in respect of a co-
10
operative in the same way as they apply to and in
respect of a company.
(2) Those provisions apply--
(a) with any modifications that are prescribed;
and
15
(b) as if a reference in those provisions to any
provision of section 289 of the Corporations
Law were a reference to the equivalent
provisions of the regulations under section
238 of this Act.
20
_______________
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PART 13--ARRANGEMENTS AND RECONSTRUCTIONS
Division 1--General requirements
339. Requirements for binding compromise or
arrangement
(1) A compromise or arrangement is binding if and
5
only if it is approved by order of the Supreme
Court and it is agreed to--
(a) if the compromise or arrangement is between
the co-operative and any of its creditors, at a
court ordered meeting by a majority in
10
number of the creditors concerned who are
present and voting (in person or by proxy),
being a majority whose debts or claims
against the co-operative amount to at least
75% of the total of the debts and claims of
15
all those creditors who are present and voting
(in person or by proxy); or
(b) if the compromise or arrangement is between
the co-operative and any of its members, by
the members concerned, by special
20
resolution passed by means of a special
postal ballot.
(2) The court ordered meeting referred to in sub-
section (1)(a) is a meeting convened in accordance
with an order of the Supreme Court under this
25
Part.
(3) The Supreme Court may grant its approval to a
compromise or arrangement subject to such
alterations or conditions as it thinks just.
(4) An order of the Supreme Court approving a
30
compromise or arrangement does not have any
effect until an office copy of the order is lodged
with the Registrar.
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(5) On the copy being lodged, the order takes effect
from the date of lodgment or such earlier date as
the Supreme Court specifies in the order.
340. Supreme Court ordered meeting of creditors
(1) If a compromise or arrangement is proposed
5
between a co-operative and any of its creditors,
the Supreme Court may on application by an
appropriate person order a meeting or meetings of
the creditors concerned.
(2) An appropriate person to apply for an order is--
10
(a) the co-operative; or
(b) any member of the co-operative; or
(c) any of the creditors concerned; or
(d) in the case of a co-operative being wound up,
the liquidator.
15
(3) The meeting must be convened in the manner and
be held in the place or places (in the State or
elsewhere) that the Supreme Court directs.
(4) In considering whether to make an order for a
meeting to be held in another jurisdiction, the
20
Supreme Court may have regard to where
creditors concerned reside.
341. Registrar to be given notice and opportunity to make
submissions
(1) The Supreme Court may make an order under this
25
Division, if the Supreme Court is satisfied that --
(a) at least 14 days notice of the hearing of the
application for the order, or such shorter
period of notice as the Supreme Court or the
Registrar permits, has been given to the
30
Registrar; and
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(b) the Registrar has had a reasonable
opportunity to examine the terms of and
make submissions to the Supreme Court in
relation to the proposed compromise or
arrangement concerned and a draft
5
explanatory statement relating to it.
(2) The "draft explanatory statement'' referred to in
sub-section (1) is a statement--
(a) explaining the effect of the proposed
compromise or arrangement and, in
10
particular, stating--
(i) any material interests of the directors of
the co-operative, whether as directors,
as members or creditors of the co-
operative or otherwise; and
15
(ii) the effect on those interests of the
proposed compromise or arrangement
in so far as that effect is different from
the effect on the like interests of other
persons; and
20
(b) setting out--
(i) any information that is prescribed; and
(ii) any other information that is material to
the making of a decision by a creditor
or member of the co-operative whether
25
or not to agree to the proposed
compromise or arrangement, being
information that is within the
knowledge of the directors of the co-
operative and has not previously been
30
disclosed to the creditors or members of
the co-operative.
342. Results of 2 or more meetings
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If the Supreme Court orders 2 or more meetings
of creditors to be held in relation to a proposed
compromise or arrangement--
(a) the meetings are to be considered to
constitute a single meeting; and
5
(b) the votes in favour of the proposed
compromise or arrangement cast at each of
the meetings are to be aggregated; and
(c) the votes against the proposed compromise
or arrangement cast at each of the meetings
10
are to be aggregated.
343. Persons disqualified from administering compromise
etc.
(1) Except with the leave of the Supreme Court, a
person must not be appointed to administer, and
15
must not administer, a compromise or
arrangement approved under this Act between a
co-operative and any of its creditors or members,
whether by the terms of that compromise or
arrangement or pursuant to a power given by the
20
terms of a compromise or arrangement, if the
person--
(a) is a mortgagee of any property of the co-
operative; or
(b) is an auditor or an officer of the co-operative;
25
or
(c) is an officer of a body corporate that is a
mortgagee of property of the co-operative; or
(d) is not a registered liquidator unless the
person is a body corporate authorised by or
30
under a law of the State to administer the
compromise or arrangement concerned; or
(e) is an officer of a body corporate related to
the co-operative; or
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(f) unless the Registrar directs in writing that
this paragraph does not apply in relation to
the person in relation to the co-operative, has
at any time within the last 12 months been an
officer or promoter of the co-operative or of
5
a related body corporate.
(2) This section does not disqualify a person from
administering a compromise or arrangement under
an appointment validly made before the
commencement of this section.
10
344. Adoption of provisions of Corporations Law and
application to person appointed
(1) Clauses 16, 18(2) and (4), 19, 23 and 25 of
Schedule 4 apply to a person appointed to
administer a compromise or arrangement as if the
15
appointment were an appointment of the person as
a receiver and manager of property of the co-
operative and as if a reference to a receiver were a
reference to that person.
(2) Section 536 of the Corporations Law is adopted by
20
this sub-section and applies to a person appointed
to administer a compromise or arrangement as if
the appointment were an appointment as a
liquidator of the co-operative and as if a reference
to a liquidator were a reference to that person.
25
345. Copy of order to be attached to rules
(1) A co-operative must ensure that a copy of an order
of the Supreme Court approving a compromise or
arrangement is annexed to each copy of the rules
of the co-operative issued after the order is made.
30
Penalty: 20 penalty units.
(2) The Supreme Court may, by order, exempt a co-
operative from compliance with this section or
determine the period during which the co-
operative must comply.
35
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346. Directors to arrange for reports
(1) When a compromise or arrangement (whether or
not for the purposes of or in connection with a
scheme for the reconstruction of a co-operative or
the merger of any 2 or more co-operatives) has
5
been proposed, the directors of the co-operative
must--
(a) if a meeting of the members of the co-
operative by resolution so directs, instruct
the accountants or solicitors or both named
10
in the resolution to report on the proposals
and send their report or reports to the
directors as soon as practicable; and
(b) make any report or reports so obtained
available at the registered office of the co-
15
operative for inspection by the members and
creditors of the co-operative at least 7 days
before the day of the meeting ordered by the
Supreme Court or the holding of the special
postal ballot, as appropriate.
20
(2) If this section is not complied with, each director
of the co-operative concerned is guilty of an
offence and liable to a penalty not exceeding 20
penalty units.
347. Power of Supreme Court to restrain further
25
proceedings
(1) If a proposed compromise or arrangement is
between a co-operative and any of its creditors and
no order has been made or resolution passed for
the winding up of the co-operative, the Supreme
30
Court may restrain further proceedings in any
action or other civil proceeding against the co-
operative except by leave of the Supreme Court
and subject to such terms as the Supreme Court
imposes.
35
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(2) The Supreme Court's power under this section is
in addition to any of its other powers and must not
be exercised except on application by the co-
operative or of any creditor or member of the co-
operative.
5
348. Supreme Court need not approve compromise or
arrangement takeovers
(1) The Supreme Court need not approve a
compromise or arrangement unless--
(a) it is satisfied that the compromise or
10
arrangement has not been proposed for the
purpose of enabling any person to avoid the
operation of any of the provisions of
Division 2 of Part 11; and
(b) there is produced to the Supreme Court a
15
statement in writing by the Registrar stating
that the Registrar has no objection to the
compromise or arrangement.
(2) The Supreme Court need not approve a
compromise or arrangement merely because a
20
statement by the Registrar stating that the
Registrar has no objection to the compromise or
arrangement has been produced to the Supreme
Court.
Division 2--Explanatory statements
25
349. Explanatory statement required to accompany notice
of meeting etc.
(1) An explanatory statement must accompany every
notice--
(a) that is sent to a creditor of a co-operative
30
convening the court ordered meeting to
obtain agreement to the compromise or
arrangement; or
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(b) that is sent to a member of a co-operative for
the purpose of the conduct of the special
postal ballot to obtain agreement to the
compromise or arrangement.
(2) In every notice of a meeting referred to in sub-
5
section (1) that is given by advertisement there
must be included either a copy of the explanatory
statement or notification of the place at which and
the manner in which creditors entitled to attend
the meeting may obtain copies of the explanatory
10
statement.
(3) The explanatory statement must--
(a) explain the effect of the compromise or
arrangement and, in particular, state--
(i) any material interests of the directors,
15
whether as directors, as members or
creditors of the co-operative or
otherwise; and
(ii) the effect on those interests of the
compromise or arrangement in so far as
20
that effect is different from the effect on
the like interests of other persons; and
(b) set out--
(i) any information that is prescribed; and
(ii) any other information that is material to
25
the making of a decision by a creditor
or member whether or not to agree to
the compromise or arrangement, being
information that is within the
knowledge of the directors and has not
30
previously been disclosed to the
creditors or members.
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(4) Sub-section (1)(a) does not apply in the case of a
creditor whose debt does not exceed $200 unless
the Supreme Court otherwise orders.
(5) The notice convening the meeting that is sent to a
creditor referred to, in sub-section (4) must specify
5
a place at which a copy of the explanatory
statement can be obtained on request.
(6) The co-operative must comply with a request
under sub-section (5) as soon as practicable.
350. Requirements for explanatory statement
10
(1) An explanatory statement must be as approved by
the Registrar.
(2) If the compromise or arrangement affects the
rights of debenture holders, the explanatory
statement must specify--
15
(a) any material interests of the trustees for the
debenture holders, whether as such trustees,
as members or creditors of the co-operative
or otherwise; and
(b) the effect on those interests of the
20
compromise or arrangement to the extent that
that effect is different from the effect on the
like interests of other persons.
(3) If a notice given by advertisement includes a
notification that copies of the explanatory
25
statement can be obtained in a particular manner,
the co-operative must furnish a copy of the
statement free of charge to each creditor or
member entitled to attend the meeting or vote in
the ballot who applies for it in the appropriate
30
manner.
(4) Each person who is a director or trustee for
debenture holders must give notice to the co-
operative of such matters relating to the person as
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Act No.
are required to be included in the explanatory
statement.
351. Contravention of Division--offence by co-operative
(1) If a provision of this Division is contravened, the
co-operative concerned and any other person
5
involved in the contravention is guilty of an
offence and liable to a penalty not exceeding 20
penalty units.
(2) It is a defence to a prosecution for an offence
under sub-section (1) if it is proved that the
10
contravention was due to the failure of a person
(other than the defendant), being a director of the
co-operative or a trustee for debenture holders of
the co-operative, to supply for the purposes of the
explanatory statement particulars of the person's
15
interests.
352. Provisions for facilitating reconstructions and
mergers
(1) In this section--
"co-operative" includes foreign co-operative
20
registered, formed or incorporated under a
law of another State or Territory.
(2) This section applies when an application is made
to the Supreme Court under this Part for the
approval of a compromise or arrangement and it is
25
shown to the Court that--
(a) the compromise or arrangement has been
proposed for the purposes of or in connection
with a scheme for the reconstruction of a co-
operative or the merger of a co-operative
30
with another co-operative or with another
body corporate; and
(b) under the scheme the whole or any part of
the undertaking or of the property of a co-
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operative concerned in the scheme ("the
transferor'') is to be transferred to another
body corporate ("the transferee'') except a
company within the meaning of the
Corporations Law.
5
(3) When this section applies, the Supreme Court
may, either by the order approving the
compromise or arrangement or by a later order
provide for any one or more of the following--
(a) the transfer to the transferee of the whole or a
10
part of the undertaking and of the property or
liabilities of the transferor;
(b) the allotting or appropriation by the
transferee of shares, debentures, policies or
other interests in the transferee that, under
15
the compromise or arrangement, are to be
allotted or appropriated by the transferee to
or for any person;
(c) the continuation by or against the transferee
of any legal proceedings pending by or
20
against the transferor;
(d) the dissolution, without winding up, of the
transferor;
(e) the provision to be made for any persons
who, within such time and in such manner as
25
the Court directs, dissent from the
compromise or arrangement;
(f) the transfer or allotment of any interest in
property to any person concerned in the
compromise or arrangement;
30
(g) such incidental, consequential and
supplemental matters as are necessary to
ensure that the reconstruction or merger is
fully and effectively carried out.
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Act No.
(4) If an order made under this section provides for
the transfer of property or liabilities, then, by
virtue of the order--
(a) the property is transferred to and vests in the
transferee, free, in the case of any particular
5
property if the order so directs, from any
charge that is by virtue of the compromise or
arrangement to cease to have effect; and
(b) the liabilities are transferred to and become
the liabilities of the transferee.
10
(5) If an order is made under this section, each body
to which the order relates must, within 14 days
after the making of the order, lodge with the
Registrar an office copy of the order.
(6) In this section--
15
"liabilities'' includes duties of any description,
including duties that are of a personal
character or are incapable under the general
law of being assigned or performed
vicariously;
20
"property'' includes rights and powers of any
description, including rights and powers that
are of a personal character and are incapable
under the general law of being assigned or
performed vicariously.
25
Division 3--Acquisition of shares of dissenting shareholders
353. Definitions
In this Division--
"dissenting shareholder'', in relation to a scheme
or contract, means a shareholder who has not
30
assented to the scheme or contract or who
has failed to transfer his, her or its shares in
accordance with the scheme or contract;
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"excluded shares'', in relation to a scheme or
contract involving a transfer to a person of
shares in a class of shares in a co-operative,
means shares in that class that, when the
offer relating to the scheme or contract is
5
made, are held by--
(a) in any case, the person or a nominee of
the person; or
(b) if the person is a body corporate, a
subsidiary of the body.
10
354. Schemes and contracts to which Division applies
(1) This Division applies to a scheme or contract
involving a transfer of shares in a co-operative
("the transferor'') to a person ("the transferee'') that
has, within 4 months after the making of the offer
15
relating to the scheme or contract by the
transferee, been approved by the holders of at least
90% in nominal value of all the shares concerned
(other than excluded shares).
(2) This Division does not apply to a scheme or
20
contract arising out of the making of an offer to
which Division 2 of Part 11 applies.
355. Acquisition of shares pursuant to notice to dissenting
shareholder
(1) The transferee under the scheme or contract may,
25
within 2 months after the offer is so approved,
give notice as prescribed (a "compulsory
acquisition notice'') to a dissenting shareholder
that the transferee wishes to acquire the shares
held by that shareholder.
30
(2) When a compulsory acquisition notice is given,
the dissenting shareholder may, by written notice
given to the transferee within one month after the
day on which the compulsory acquisition notice
was given, ask for a statement in writing of the
35
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s. 356
Act No.
names and addresses of all other dissenting
shareholders as shown in the register of members
and the transferee must give that statement.
(3) Having given the compulsory acquisition notice,
the transferee is, unless the Supreme Court orders
5
to the contrary, entitled and bound to acquire those
shares on the terms on which, under the scheme or
contract, the shares of the approving shareholders
are to be transferred to the transferee.
(4) The Supreme Court may give an order to the
10
contrary only on the application of the dissenting
shareholder made within 28 days after the
compulsory acquisition notice was given or within
14 days after any statement asked for under sub-
section (2) was given, whichever is the later.
15
(5) If alternative terms are offered to the approving
shareholders--
(a) the dissenting shareholder is entitled to elect
which of those terms are preferred but must
make that election within the time allowed
20
for the making of an application to the
Supreme Court under sub-section (4); and
(b) if the dissenting shareholder fails to make the
election within that time, the transferee may,
unless the Supreme Court otherwise orders,
25
determine which of those terms is to apply to
the acquisition of the shares of the dissenting
shareholder.
356. Restrictions when excluded shares exceed 10%
If the nominal value of excluded shares exceeds
30
10% of the aggregate nominal value of all the
shares (including excluded shares) to be
transferred under the scheme or contract, section
355 does not apply unless--
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(a) the transferee offers the same terms to all
holders of the shares (other than excluded
shares) to be transferred under the scheme or
contract; and
(b) the holders who approve the scheme or
5
contract together hold at least 90% in
nominal value of the shares (other than
excluded shares) to be transferred under the
scheme or contract and are also at least 75%
in number of the holders of those shares
10
(with joint owners of shares being counted as
one person).
357. Remaining shareholders may require acquisition
(1) If, under a scheme or contract to which this
Division applies, the transferee becomes
15
beneficially entitled to shares in the transferor
which, together with any other shares in the
transferor to which the transferee or a body
corporate related to the transferee is beneficially
entitled comprise or include 90% in nominal value
20
of the shares concerned, then--
(a) the transferee must, within 28 days after
becoming beneficially entitled to those
shares, give notice of the fact as prescribed to
the holders of the remaining shares
25
concerned who, when the notice was given,
had not assented to the scheme or contract or
been given a compulsory acquisition notice
by the transferee under this Division; and
(b) such a holder may, within 3 months after
30
being given that notice, by notice to the
transferee require the transferee to acquire
the holder's share and, if alternative terms
were offered to the approving shareholders,
elect which of those terms the holder will
35
accept.
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Act No.
(2) If a shareholder gives notice under this section
with respect to the shareholder's shares, the
transferee is entitled and bound to acquire those
shares--
(a) on the terms on which under the scheme or
5
contract the shares of the approving
shareholders were transferred to the
transferee and, if alternative terms were
offered to those shareholders, on the terms
for which the shareholder has elected, or, if
10
no election is made, for whichever of the
terms the transferee determines; or
(b) on such other terms as are agreed or as the
Supreme Court, on the application of the
transferee or of the shareholder, thinks fit to
15
order.
358. Transfer of shares pursuant to compulsory
acquisition
(1) A transferee who has given a compulsory
acquisition notice must--
20
(a) send a copy of the notice to the transferor
together with an instrument of transfer that
relates to the shares that the transferee is
entitled to acquire under this Division and
that is executed, on the shareholder's behalf,
25
by a person appointed by the transferee and,
on the transferee's own behalf, by the
transferee; and
(b) pay, allot or transfer to the transferor the
consideration for the shares.
30
(2) The transferee must do so within 14 days after
whichever of the following happens last--
(a) the period of 28 days after the day on which
the compulsory acquisition notice was given
expires;
35
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(b) the period of 14 days after a statement of the
names and addresses of dissenting
shareholders is supplied under this Division
expires;
(c) if an application has been made to the
5
Supreme Court by a dissenting shareholder,
the application is disposed of.
(3) When the transferee has complied with this
section, the transferor must register the transferee
as the holder of the shares.
10
(4) This section does not apply if the Supreme Court
on the application of the dissenting shareholder
orders to the contrary.
359. Disposal of consideration for shares compulsorily
acquired
15
(1) All sums received by the transferor under this
Division must be paid into a separate bank
account and those sums, and any other
consideration so received, are to be held by the
transferor in trust for the several persons entitled
20
to the shares in respect of which they were
respectively received.
(2) If a sum or other property received by the
transferor under this Division has been held in
trust by the transferor for a person for at least 2
25
years, the transferor must pay the sum or transfer
the consideration, and any accretions to it and any
property that may become substituted for it or for
part of it, to the Registrar.
(3) The Registrar must then to deal with it in
30
accordance with Part 9.7 of the Corporations Law
which for that purpose is adopted and applies as
part of this Act.
(4) The transferor must comply with sub-section (2)
before the end of 10 years after the day on which
35
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s. 360
Act No.
the sum was paid, or the consideration was
allotted or transferred, to the transferor.
Division 4--Miscellaneous
360. Notification of appointment of scheme manager
Within 14 days after being appointed to
5
administer a compromise or arrangement
approved under this Part, a person must lodge
with the Registrar a written notice of the
appointment.
Penalty: 10 penalty units.
10
361. Power of Supreme Court to require reports
When an application is made to the Supreme
Court under this Part in relation to a proposed
compromise or arrangement, the Supreme Court
may--
15
(a) before making any order on the application,
require the Registrar or any other person to
give to the Court a report as to--
(i) the terms of the compromise or
arrangement or of the scheme for the
20
purposes of or in connection with
which the compromise or arrangement
has been proposed; and
(ii) the conduct of the officers of the body
or bodies concerned; and
25
(iii) any other matters that, in the opinion of
the Registrar or that person, ought to be
brought to the attention of the Court;
and
(b) in deciding the application, have regard to
30
anything contained in the report; and
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(c) make such order or orders as to the payment
of the costs of preparing and giving the
report as the Court thinks fit.
362. Effect of out-of-jurisdiction compromise or
arrangement
5
(1) A compromise or arrangement that is binding on
any creditors of a foreign co-operative because of
a provision of the law of another State or a
Territory that corresponds to this Part is also
binding on the creditors of the foreign co-
10
operative whose debts are recoverable by action in
a court of this State.
(2) If the Supreme Court of another State or a
Territory makes an order under a provision of the
law of that State or Territory that is prescribed as
15
corresponding to a provision of this Part, the order
is to be considered to have been made by the
Supreme Court of Victoria under that
corresponding provision of this Act and has effect
and may be enforced accordingly.
20
363. Jurisdiction to be exercised in harmony with
Corporations Law jurisdiction
The jurisdiction of the Supreme Court under this
Part is intended to complement the Supreme
Court's jurisdiction under the Corporations Law
25
and should be exercised in harmony with that
jurisdiction.
364. Registrar may appear etc.
In any proceedings before the Supreme Court
under this Part, the Registrar is entitled to appear
30
and be heard, either in person or by the Registrar's
duly appointed representative.
_______________
PART 14--FOREIGN CO-OPERATIVES
35
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s. 365
Act No.
Division 1--Introductory
365. Definitions
In this Part--
"co-operatives law" means a law that under an
Order in force under section 366 is declared
5
to be a co-operatives law for the purposes of
this Part;
"non-participating co-operative" means a
foreign co-operative other than a
participating co-operative;
10
"participating co-operative" means a foreign co-
operative that is registered, incorporated or
formed under, or subject to, a co-operatives
law;
"participating State" means any State in which a
15
co-operatives law is in force;
"State" includes the Australian Capital Territory
and the Northern Territory.
366. Co-operatives law
(1) Subject to sub-section (2), the Governor in
20
Council may, by Order published in the
Government Gazette, declare that a law of a State
other than Victoria is a co-operatives law for the
purposes of this Part.
(2) An Order must not be made under sub-section (1)
25
in respect of the law of another State unless the
Governor in Council is satisfied that the law--
(a) substantially corresponds to the provisions of
this Act; and
(b) contains provisions that are referred to in this
30
Part as provisions of a co-operatives law that
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correspond to specified provisions of this
Act.
Division 2--Registration of foreign co-operatives
367. Operation of foreign co-operatives in Victoria
A foreign co-operative must not carry on business
5
in Victoria unless it is registered under this Part.
Penalty: 240 penalty units.
368. What constitutes carrying on business
(1) A foreign co-operative carries on business in
Victoria if it--
10
(a) solicits for members in Victoria; or
(b) seeks share capital in Victoria; or
(c) provides any goods or services within
Victoria.
(2) A foreign co-operative is not to be regarded as
15
carrying on business in Victoria only by reason
that in Victoria it--
(a) is or becomes a party to any action or suit or
arbitration proceeding or effects settlement
of an action, suit or proceeding or of any
20
claim or dispute; or
(b) holds meetings of its directors or members or
carries on other activities concerning its
internal affairs; or
(c) maintains any bank account; or
25
(d) effects any sale through an independent
contractor; or
(e) solicits or procures any offer that becomes a
binding contract only if the offer is accepted
outside Victoria; or
30
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Act No.
(f) creates evidence of any debt or creates a
charge on real and personal property; or
(g) secures or collects any of its debts or
enforces its rights in regard to any securities
relating to the debts; or
5
(h) conducts an isolated transaction that is
completed within a period of 31 days not
being one of a number of similar transactions
repeated from time to time.
369. Application for registration of participating co-
10
operative
(1) A participating co-operative that proposes to carry
on business as a co-operative in Victoria may
apply to the Registrar in the prescribed manner to
be registered as a foreign co-operative.
15
(2) An application by a participating co-operative
must be accompanied by--
(a) a certificate, not more than 2 months old,
from the Registrar of the participating State,
in which the participating co-operative is
20
registered, incorporated or formed stating
that the co-operative is complying with the
provisions of the co-operatives law of that
State prescribed for the purpose of the
section of that law that corresponds with
25
section 378; and
(b) the documents prescribed for the purpose of
the section of the co-operatives law of that
State that corresponds with section 378; and
(c) a copy of the current rules of the co-
30
operative; and
(d) a statement, verified as prescribed, setting
out--
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s. 370 Act No.
(i) the full name and address of each
person who will act as agent of the co-
operative in Victoria; and
(ii) the address of the proposed registered
office of the co-operative in Victoria;
5
and
(iii) a copy of an instrument appointing a
person resident in Victoria (other than a
body corporate incorporated outside
Victoria) as a person on whom all
10
notices and legal process may be served
on behalf of the co-operative; and
(e) any other documents or information that are
prescribed; and
(f) the prescribed fee.
15
370. Application for registration of non-participating co-
operative
(1) A non-participating co-operative that proposes to
carry on business as a co-operative in Victoria
may apply to the Registrar in the prescribed
20
manner to be registered as a foreign co-operative.
(2) An application by a non-participating co-operative
must be accompanied by--
(a) a copy of the current rules of the co-
operative; and
25
(b) a statement, verified as prescribed, setting
out--
(i) the full name and address of each
person who will act as agent of the co-
operative in Victoria; and
30
(ii) the address of the proposed registered
office of the co-operative in Victoria;
and
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Act No.
(iii) a copy of an instrument appointing a
person resident in Victoria (other than a
body corporate incorporated outside
Victoria) as a person on whom all
notices and legal process may be served
5
on behalf of the co-operative; and
(c) any other documents or information that are
prescribed; and
(d) the prescribed fee.
371. Registrar to approve rules of non-participating co-
10
operative
A non-participating co-operative is not eligible
for registration unless the Registrar is satisfied that
the rules of the co-operative--
(a) comply with co-operative principles; and
15
(b) include acceptable active membership
provisions; and
(c) provide procedures acceptable to the
Registrar for disclosure of information; and
(d) provide that a member has one vote only;
20
and
(e) make adequate provision for the duties of
directors; and
(f) provide for acceptable accounting standards
for the co-operative.
25
372. Name of foreign co-operative
(1) A foreign co-operative is eligible for registration
under this Part if the name under which it
proposes to carry on business in Victoria is not
such as is likely to be confused with the name of a
30
body corporate or a registered business name.
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(2) If the Registrar advises the foreign co-operative
that the name under which it proposes to carry on
business in Victoria is likely to be confused with
the name of a body corporate or registered
business name, the co-operative may amend its
5
application by substituting another name.
373. Registration of foreign co-operative
If, on due application, the Registrar is satisfied
that the foreign co-operative is eligible for
registration, the Registrar must register the foreign
10
co-operative as a foreign co-operative and issue a
certificate of registration in accordance with the
regulations.
374. Application of Act and regulations to foreign co-
operatives
15
The prescribed provisions of this Act and the
regulations apply, with all necessary modifications
and any prescribed modifications, to a foreign co-
operative which is registered under this Part as if
the foreign co-operative were a co-operative.
20
375. Registrar to be notified of certain changes
Within 28 days of any alteration affecting--
(a) the rules or constitution of a foreign co-
operative registered under this Part; or
(b) the directors of the foreign co-operative; or
25
(c) the agents (or their addresses) of the foreign
co-operative; or
(d) the person appointed as the person on whom
notices and legal process may be served on
behalf of the foreign co-operative; or
30
(e) the address of the registered office in
Victoria of the foreign co-operative; or
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s. 376
Act No.
(f) the address of the registered office in the
participating State of a participating co-
operative registered under this Part; or
(g) the name under which the participating co-
operative carries on business in the
5
participating State--
the foreign co-operative must lodge with the
Registrar particulars of the alteration accompanied
by any prescribed documents.
376. Balance sheets
10
(1) A foreign co-operative registered under this Part
must, within 6 months (or such longer period as
the Registrar may allow) of the end of each of its
financial years, lodge with the Registrar--
(a) in the case of a participating co-operative, a
15
copy of the balance sheet relating to its
financial affairs as at the end of the financial
year, in the form and with any accompanying
documents required by the co-operatives law
of the participating State concerned; and
20
(b) in the case of a non-participating co-
operative, a copy of the balance sheet
relating to its financial affairs as at the end of
the financial year, in the form and with any
accompanying documents required by the
25
Registrar.
Penalty: 20 penalty units.
(2) If the Registrar is of the opinion that a balance
sheet lodged with the Registrar under this section
does not sufficiently disclose the financial affairs
30
of the foreign co-operative, the Registrar may, by
written notice, require the foreign co-operative to
give the Registrar further information or
documents.
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(3) A foreign co-operative must comply with a notice
given to it under sub-section (2) within the period
specified in the notice.
Penalty: 60 penalty units.
377. Cessation of business
5
(1) A foreign co-operative registered under this Part
must, within 7 days of ceasing to carry on business
as a co-operative in Victoria, notify the Registrar
in writing of that fact.
Penalty: 60 penalty units.
10
(2) On notifying the Registrar that it has ceased to
carry on business as a co-operative in Victoria, a
foreign co-operative is no longer obliged to
comply with this Part.
(3) Unless the Registrar has been notified in writing
15
that the foreign co-operative has resumed carrying
on business as a co-operative in Victoria, the
Registrar must, 1 year after receiving a
notification under sub-section (1), cancel the
registration of the foreign co-operative.
20
378. Co-operative proposing to register as a foreign co-
operative
(1) A co-operative that proposes to apply to be
registered as a foreign co-operative in another
participating State may apply to the Registrar for a
25
certificate that it is complying with all prescribed
provisions of this Act including, if the Registrar
has varied a requirement in relation to that co-
operative, the provision as varied.
(2) The Registrar must issue the certificate to the co-
30
operative unless he or she is of the opinion that the
co-operative is not complying with the prescribed
provisions.
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(3) If the Registrar issues the certificate, he or she
must also give to the co-operative the prescribed
documents.
Division 3--Mergers and transfers of engagements
379. Who is the appropriate Registrar?
5
In this Division--
"appropriate Registrar" in relation to a
proposed merger or transfer of engagements
means--
(a) the Victorian Registrar, if the merger is
10
to result in a Victorian co-operative or
the transfer is to a Victorian co-
operative; or
(b) the Registrar for the participating State
concerned, if the merger is to result in a
15
co-operative under the co-operatives
law of that participating State or the
transfer is to such a co-operative.
380. Authority for merger or transfer of engagements
(1) A Victorian co-operative and a participating co-
20
operative may consolidate all or any of their
assets, liabilities and undertakings by way of
merger or transfer of engagements approved under
this Division.
(2) A Victorian co-operative and a non-participating
25
co-operative may consolidate all or any of their
assets, liabilities and undertakings by way of
merger or transfer of engagements approved under
this Division if--
(a) the merger is to result in a Victorian co-
30
operative; or
(b) the transfer is to a Victorian co-operative.
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381. Requirements before application can be made
(1) Before a Victorian co-operative and a participating
co-operative can apply for approval under this
Division of a merger or transfer of engagements,
the proposed merger or transfer must have been
5
approved by each of the co-operatives by--
(a) a special resolution passed by special postal
ballot; or
(b) if permitted by sub-section (3), by a
resolution of the board of the co-operative.
10
(2) Before a Victorian co-operative and a non-
participating co-operative can apply for approval
under this Division of a merger or transfer of
engagements, the proposed merger or transfer of
engagements--
15
(a) must have been approved--
(i) in the case of the non-participating co-
operative, by a special resolution of the
co-operative; and
(ii) in the case of the Victorian co-
20
operative, by a special resolution passed
by special postal ballot; or
(b) if permitted by sub-section (3), must have
been approved by a resolution of the board of
each of the co-operatives.
25
(3) The proposed merger or transfer of engagements
may be approved by resolution of the board of a
co-operative if--
(a) the Victorian Registrar consents to that
procedure applying in the particular case; and
30
(b) in the case of a merger or transfer affecting a
participating co-operative, the Registrar for
the participating State concerned also
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consents to that procedure applying in the
particular case.
382. Disclosure statement required
(1) A special resolution of the Victorian co-operative
or foreign co-operative is not effective for the
5
purposes of this Division unless this section has
been complied with.
(2) Each co-operative must send to each of its
members a disclosure statement approved by the
appropriate Registrar specifying--
10
(a) the financial position of the Victorian co-
operative and the foreign co-operative as
shown in financial statements that have been
prepared as at a date that is not more than 6
months before the date of the statement; and
15
(b) any interest that any officer of the Victorian
co-operative or the foreign co-operative has
in the proposed merger or transfer of
engagements; and
(c) any compensation or other consideration
20
proposed to be paid, or any other incentive
proposed to be given, to any officer or
member of the Victorian co-operative or
foreign co-operative in relation to the
proposed merger or transfer of engagements;
25
and
(d) whether the proposal is a merger or transfer
of engagements and the reason for the
merger or transfer or engagements; and
(e) in the case of a transfer of engagements--
30
whether it is a total or partial transfer of
engagement; and
(f) in the case of a merger--whether the merged
co-operative will result in a Victorian co-
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operative or a co-operative under the co-
operatives law of the participating State
concerned; and
(g) any other information that the Registrar
directs.
5
(3) The disclosure statement must be sent to the
members of the Victorian co-operative or foreign
co-operative so that it will be in the ordinary
course of post reach each member who is entitled
to vote on the special resolution not later than--
10
(a) where the resolution is to be decided at a
meeting--21 days before the date of the
meeting; or
(b) where the resolution is to be decided by a
postal ballot--21 days before the day on or
15
before which the ballot papers must be
returned by members voting in the ballot.
(4) The appropriate Registrar may exempt the
Victorian co-operative or foreign co-operative
from complying with this section.
20
(5) The appropriate Registrar may grant an
exemption, or approve a disclosure statement,
subject to any conditions it considers appropriate.
383. Making an application
(1) An application for approval of a merger or transfer
25
of engagements under this Division must be made
to the Victorian Registrar and, if the merger or
transfer affects a participating co-operative, to the
Registrar for the participating State concerned in
the manner and form required by the Registrar
30
concerned.
(2) An application for approval of a merger must be
accompanied by--
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(a) 2 copies of the proposed rules of the merged
co-operative; and
(b) in the case of a non-participating co-
operative, details of voting on the special
resolution (if any) of the co-operative; and
5
(c) any other information required by the
Registrar to whom the application is made.
384. Approval of merger
(1) If the Victorian Registrar is the appropriate
Registrar, he or she must approve a merger
10
pursuant to an application under this Division if
satisfied that--
(a) this Division has been complied with in
relation to the application; and
(b) the proposed rules of the merged co-
15
operative are adequate; and
(c) the certificate of registration of the Victorian
co-operative has been surrendered to the
Victorian Registrar; and
(d) in the case of a merger with a participating
20
co-operative, the certificate of registration of
the participating co-operative has been
surrendered to the Registrar for the
participating State concerned; and
(e) in the case of a merger with a non-
25
participating co-operative, the merged co-
operative will comply with this Act;
(f) there is no good reason why the merged co-
operative and its rules should not be
registered.
30
(2) If the Victorian Registrar is not the appropriate
Registrar, he or she must approve a merger
pursuant to an application under this Division if
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satisfied that the merger has been approved under
the provision of the co-operatives law of the
participating State that corresponds with sub-
section (1).
(3) On approving an application for merger, the
5
Victorian Registrar must--
(a) cancel the registration of the Victorian co-
operative involved in the merger, and
(b) if the merger is to result in a Victorian co-
operative, register the merged co-operative
10
and its rules and issue to it a certificate of
registration under this Act.
(4) A merger takes effect on the issue of the
certificate of registration for the merged co-
operative (whether under this Act or under the co-
15
operatives law of the participating State
concerned).
385. Approval of transfer of engagements
(1) If the Victorian Registrar is the appropriate
Registrar, he or she must approve a transfer of
20
engagements pursuant to an application under this
Division if satisfied that--
(a) this Division has been complied with in
relation to the application; and
(b) the rules or proposed rules of the transferee
25
co-operative are adequate; and
(c) in the case of a total transfer of engagements
from a participating co-operative, the
certificate of registration of the participating
co-operative has been surrendered to the
30
Registrar for the participating State
concerned; and
(d) in the case of a total transfer of engagements
from a non-participating co-operative, the
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certificate of registration of the non-
participating co-operative has been
surrendered to the Registrar; and
(e) in the case of a transfer of engagements by a
non-participating co-operative, the transferee
5
co-operative will comply with this Act; and
(f) there is no good reason why the transfer of
engagements should not take effect.
(2) If the Victorian Registrar is not the appropriate
Registrar, he or she must approve a transfer of
10
engagements pursuant to an application under this
Division if satisfied that the transfer has been
approved under the provision of the co-operatives
law of the participating State that corresponds
with sub-section (1).
15
(3) A transfer of engagements takes effect on the day
specified in the approval of the Victorian
Registrar.
386. Effect of merger or transfer of engagements
(1) In this section--
20
"assets" means any legal or equitable estate or
interest (whether present or future and
whether vested or contingent) in real or
personal property of any description
(including money) and includes securities,
25
choses in action and documents;
"instrument" means an instrument (other than
this Act) which creates, modifies, or
extinguishes rights or liabilities (or would do
so if lodged, filed or registered in accordance
30
with any law) and includes any judgment,
order and process of a court;
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"liabilities" means liabilities, debts and
obligations (whether present or future and
whether vested or contingent);
"original co-operative" means--
(a) in the case of a transfer of engagements,
5
the transferor co-operative; or
(b) in the case of a merger, each of the co-
operatives that are merging;
"successor co-operative" means--
(a) in the case of a transfer of engagements,
10
the transferee co-operative; or
(b) in the case of a merger, the co-operative
formed by the merger.
(2) When a merger or transfer of engagements, takes
effect under this Division ("the transfer day") the
15
following provisions apply to the extent necessary
to give effect to the merger or transfer--
(a) persons who were members of the original
co-operative immediately before the transfer
day are members of the successor co-
20
operative in accordance with its rules; and
(b) the assets of the original co-operative vest in
the successor co-operative without the need
for any conveyance, transfer, assignment or
assurance; and
25
(c) the rights and liabilities of the original co-
operative become the rights and liabilities of
the successor co-operative; and
(d) all proceedings by or against the original co-
operative that are pending immediately
30
before the transfer day are taken to be
proceedings pending by or against the
successor co-operative; and
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Act No.
(e) any act, matter or thing done or omitted to be
done by, to or in respect of the original co-
operative before the transfer day is (to the
extent to which that act, matter or thing has
any force or effect) to be taken to have been
5
done or omitted by, to or in respect of the
successor co-operative; and
(f) a reference in an instrument or in any
document of any kind to the original body is
to be read as, or as including, a reference to
10
the new body.
(3) The operation of this section is not to be
regarded--
(a) as a breach of contract or confidence or
otherwise as a civil wrong; or
15
(b) as a breach of any contractual provision
prohibiting, restricting or regulating the
assignment or transfer of assets, rights or
liabilities; or
(c) as giving rise to any remedy by a party to an
20
instrument, or as causing or permitting the
termination of any instrument, because of a
change in the beneficial or legal ownership
of any asset, right or liability.
(4) A document or an instrument executed or
25
registered for or with respect to a transfer of any
property to give effect to this section in respect of
a transfer of engagements is not liable to stamp
duty or to any fee chargeable under any Act for
registration.
30
(5) A document or an instrument executed or
registered for or with respect to a transfer of any
property to give effect to this section in respect of
a merger is not liable to stamp duty or to any fee
chargeable under any Act for registration if the co-
35
254
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s. 387 Act No.
operative formed by the merger is a non-trading
co-operative.
387. Division applies instead of certain other provisions of
this Act
(1) This Division applies instead of Division 1 of Part
5
12, in respect of the merger of a Victorian co-
operative with a foreign co-operative.
(2) This Division applies instead of Division 1 of Part
12, in respect of a transfer of engagements
between a Victorian co-operative and a foreign co-
10
operative.
_______________
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s. 388
Act No.
PART 15--SUPERVISION AND PROTECTION OF CO-
OPERATIVES
Division 1--Supervision and inspection
388. Definitions
In this Part--
5
"co-operative venture'' means--
(a) any body corporate or unit trust formed
by a co-operative or in the formation of
which a co-operative participated; or
(b) any partnership, joint venture or
10
association of persons or bodies formed
or entered into by a co-operative;
"premises'' includes any structure, building,
aircraft, vehicle, vessel and place (whether
built on or not) and any part of such a
15
structure, building, aircraft, vehicle, vessel or
place;
"relevant documents'' means records or other
documents that relate to the promotion,
formation, membership, control,
20
transactions, dealings, business or property
of a co-operative.
389. "Co-operative'' includes subsidiaries, foreign co-
operatives and co-operative ventures
A reference in this Part to a co-operative includes
25
a reference to each of the following--
(a) a foreign co-operative;
(b) a subsidiary of a co-operative or foreign co-
operative;
(c) a co-operative venture;
30
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(d) a co-operative or foreign co-operative, or a
subsidiary of either, or a co-operative
venture, that is in the course of being wound
up or has been dissolved.
390. Appointment of inspectors
5
The Minister may appoint persons to be
inspectors for the purposes of this Act.
391. Registrar and investigators have functions of
inspectors
The Registrar, and any investigator exercising
10
functions under Division 2, have and may exercise
all the functions of an inspector and for that
purpose are to be considered to be inspectors.
392. Inspector's identity card
(1) The Minister must provide each inspector with an
15
identity card.
(2) An inspector must produce his or her identity card
on request on applying for admission to any
premises.
393. Inspectors may require certain persons to appear,
20
answer questions and produce documents
(1) An inspector may by notice in the prescribed
form--
(a) require a co-operative to produce to the
inspector at a time and place specified in the
25
notice specified relevant documents relating
to the co-operative; and
(b) require any person who is involved in the
activities of a co-operative to produce to the
inspector at a time and place specified in the
30
notice specified relevant documents relating
to the co-operative; and
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(c) require any person who is involved in the
activities of a co-operative--
(i) to attend before the inspector at a time
and place specified in the notice; and
(ii) to answer any questions put to the
5
person by the inspector relating to the
promotion, formation, membership,
control, transactions, dealings, business
or property of the co-operative.
(2) A person is to be considered to be involved in the
10
activities of a co-operative if the person--
(a) is or has been an officer or employee of, or
an agent, banker, solicitor, auditor or other
person acting in any capacity for or on behalf
of, the co-operative; or
15
(b) is a person who has any relevant documents
relating to the co-operative in his or her
possession or control; or
(c) is a person who was a party to the creation of
any relevant documents relating to the co-
20
operative.
(3) A person is not subject to any liability by reason
of complying with a requirement made or
purportedly made under this section.
394. Inspectors' powers of entry
25
(1) An inspector has power to enter any of the
following premises--
(a) any premises on which the affairs or
activities of a co-operative are managed or
conducted;
30
(b) any premises on which the inspector suspects
on reasonable grounds there is evidence of
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the commission of an offence under this Act
or the regulations;
(c) any premises on which the inspector suspects
on reasonable grounds there are relevant
documents.
5
(2) Despite sub-section (1), the consent of the
occupier or the authority of a search warrant is
required to enter--
(a) any part of premises not used for the
management or conduct of the affairs or
10
activities of a co-operative; and
(b) any part of premises used for residential
purposes (whether or not the part is also used
for the management or conduct of the affairs
or activities of a co-operative).
15
395. Powers of inspectors on premises entered
An inspector has the following powers on
premises that the inspector is authorised to enter--
(a) power to search for evidence of any
contravention of this Act or the regulations;
20
(b) power to search for relevant documents and
to require any person on the premises to
produce to the inspector any relevant
documents in the person's custody or under
the person's control;
25
(c) power to require any person on the premises
who is apparently involved in the
management or conduct of the affairs or
activities of a co-operative to answer
questions or provide information;
30
(d) power to exercise the functions of an
inspector under section 396 in relation to any
relevant documents found on the premises or
produced to the inspector.
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396. Functions of inspectors in relation to relevant
documents
(1) An inspector has the following powers in relation
to relevant documents found by an inspector on
premises entered by the inspector or produced to
5
the inspector pursuant to a requirement made
under this Division--
(a) power to take possession of the documents or
secure them against interference;
(b) power to make copies, or take extracts from,
10
the documents;
(c) power to require any person who was party
to the creation of the documents to make a
statement providing any explanation that the
person is able to provide as to any matter
15
relating to the creation of the documents or
as to any matter to which the documents
relate;
(d) power to retain possession of the documents
for such period as is necessary to enable the
20
documents to be inspected, and copies of, or
extracts from, the documents to be made or
taken.
(2) While an inspector retains possession of a
document, the inspector must permit a person who
25
would be entitled to inspect the document were it
not in the possession of the inspector to inspect
the document at any reasonable time and make a
copy of, or take extracts from, the document.
(3) If an inspector takes possession of or secures
30
against interference any relevant document and a
person has a lien on the document, the inspector's
actions do not prejudice the lien.
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397. Offence--failing to comply with requirements of
inspector
(1) A person who fails to comply with any
requirement made of the person by an inspector
under the authority of this Part is guilty of an
5
offence and liable to a penalty not exceeding 120
penalty units or imprisonment for 12 months, or
both unless the person establishes that he or she
had a reasonable excuse for failing to comply.
(2) A person who in purported compliance with a
10
requirement under this Division furnishes
information or makes a statement that is false or
misleading in a material particular is guilty of an
offence and liable to a penalty not exceeding 120
penalty units or imprisonment for 12 months or
15
both unless the person establishes that he or she
believed on reasonable grounds that it was true
and not misleading.
(3) A person must not without reasonable excuse
obstruct or hinder an inspector exercising
20
functions under this Act.
Penalty: 120 penalty units or imprisonment for
12 months, or both.
(4) The occupier or person in charge of any premises
must provide a person who enters the premises
25
under the authority of this Part or pursuant to a
search warrant referred to in section 399 with all
reasonable facilities and assistance for the
effective exercise of the person's powers under
this Part or under the warrant.
30
Penalty: 50 penalty units or imprisonment for 6
months or both.
398. Protection from incrimination
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Act No.
(1) A person is not excused from making a statement
pursuant to a requirement under this Division on
the ground that the statement might tend to
incriminate him or her.
(2) However, if the person claims before making a
5
statement that the statement might tend to
incriminate him or her, the statement is not
admissible in evidence against him or her in
criminal proceedings other than proceedings under
this Division.
10
(3) Except as provided by sub-section (2), a statement
made by a person in compliance with a
requirement under this Division may be used in
evidence in any criminal or civil proceedings
against the person.
15
399. Search warrants
(1) An inspector may apply to a magistrate for the
issue of a search warrant in respect of premises if
the inspector believes on reasonable grounds--
(a) that the affairs or activities of a co-operative
20
are being managed or conducted on the
premises; or
(b) that there is evidence on the premises of the
commission of an offence under this Act or
the regulations; or
25
(c) that there are relevant documents on the
premises.
(2) If a magistrate is satisfied by the evidence on oath,
whether oral or by affidavit, that there are
reasonable grounds for doing so, the magistrate
30
may issue a search warrant authorising an
inspector named in the warrant and any assistants
the inspector considers necessary to enter the
premises and exercise all or specified functions of
an inspector on the premises.
35
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(3) In addition to any other requirement, a search
warrant issued under this section must state--
(a) the grounds for the issue of the warrant; and
(b) the premises to be searched; and
(c) any conditions to which the warrant is
5
subject; and
(d) whether entry is authorised to be made at any
time or during stated hours; and
(e) a day, not later than 7 days after the issue of
the warrant, on which the warrant ceases to
10
have effect.
(4) A search warrant must be issued in accordance
with the Magistrates' Court Act 1989 and in the
form prescribed under that Act.
(5) The rules to be observed with respect to search
15
warrants mentioned in the Magistrates' Court
Act 1989 extend and apply to warrants under this
section.
(6) A member of the police force may accompany an
inspector executing a search warrant issued under
20
this section and may take all reasonable steps to
assist in the exercise of the functions of the
inspector under this Act.
(7) Before executing a search warrant, the inspector
named in the warrant or a person assisting the
25
inspector must announce that he or she is
authorised by the warrant to enter the premises
and give any person at the premises an opportunity
to allow entry to the premises.
(8) The inspector or a person assisting the inspector
30
need not comply with sub-section (7) if he or she
believes on reasonable grounds that immediate
entry to the premises is required to ensure that the
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s. 400
Act No.
effective execution of the search warrant is not
frustrated.
(9) If an occupier or another person who apparently
represents the occupier is present at premises
when a search warrant is being executed, the
5
inspector must--
(a) identify himself or herself to that person by
producing his or her identity card for
inspection by that person; and
(b) give to that person a copy of the execution
10
copy of the warrant.
400. Copies or extracts of records to be admitted in
evidence
(1) Subject to this section, in any legal proceedings
(whether proceedings under this Act or otherwise),
15
a copy of or extract from a record relating to
affairs of a co-operative is admissible in evidence
as if it were the original record or the relevant part
of the original record.
(2) A copy of or extract from a record is not
20
admissible in evidence under sub-section (1)
unless it is proved that the copy or extract is a true
copy of the record or of the relevant part of the
record.
(3) For the purposes of sub-section (2), evidence that
25
a copy of or extract from a record is a true copy of
the record or of a part of the record may be given
either orally or by an affidavit or statutory
declaration by a person who has compared the
copy or extract with the record or the relevant part
30
of the record.
401. Privilege
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(1) A legal practitioner is entitled to refuse to comply
with a requirement under section 393 or 396
relating to a relevant document if--
(a) the document contains a privileged
communication made by or on behalf of or to
5
the legal practitioner in his or her capacity as
a legal practitioner; or
(b) the legal practitioner is not able to comply
with the requirement without disclosing a
privileged communication made by or on
10
behalf of or to the legal practitioner in his or
her capacity as a legal practitioner.
(2) The legal practitioner is not entitled to refuse to
comply with the requirement to the extent that he
or she is able to comply with it without disclosing
15
the privileged communication.
(3) The legal practitioner is also not entitled to refuse
to comply with the requirement if the person by or
on behalf of whom the communication was made
or (if the person is under administration under Part
20
5.3A of the Corporations Law, as adopted and
applying under this Act, or in the course of being
wound up) the administrator or the liquidator
agrees to the legal practitioner complying with the
requirement.
25
(4) If the legal practitioner refuses to comply with the
requirement, he or she must immediately furnish
in writing to the Registrar--
(a) the name and address of the person to whom
or by or on behalf of whom the
30
communication was made (if known to the
legal practitioner); and
(b) sufficient particulars to identify the
document containing the communication (if
the communication was made in writing).
35
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s. 402
403
Act No.
Penalty: 60 penalty units.
402. Police aid for inspectors
(1) An inspector may call to his or her aid a member
of the police force if he or she is obstructed, or
believes on reasonable grounds that he or she will
5
be obstructed, in the exercise of his or her
functions as an inspector.
(2) A member of the police force has, while acting in
aid of an inspector, all the functions of an
inspector.
10
Division 2--Inquiries
403. Definitions
(1) In this Division--
"affairs'', in relation to a co-operative, includes--
(a) the promotion, formation, membership,
15
control, transactions, dealings, business
and property of the co-operative; and
(b) loans made to the co-operative; and
(c) matters that are concerned with
identifying people who are, or have
20
been, financially interested in the
success or failure, or apparent success
or failure, of the co-operative or who
are, or have been, able to control or
influence materially the policies of the
25
co-operative; and
(d) the circumstances in which a person
placed, withdrew or disposed of funds
with, or loans to, the co-operative;
"costs'', in relation to an inquiry under this
30
Division, includes--
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(a) the expenses of, and incidental to, the
inquiry; and
(b) the expenses payable by the Registrar in
any proceedings instituted by the
Registrar under this Division in the
5
name of the co-operative the subject of
the inquiry; and
(c) so much of the remuneration of an
officer or employee of the Crown as is
determined by the Treasurer to be
10
attributable to matters connected with
the inquiry;
"investigator" means a person appointed under
section 404;
"involved person'', in relation to an inquiry into
15
the affairs of a co-operative, means--
(a) an officer of the co-operative; or
(b) a person who acts, or has at any time
acted, as banker, solicitor, auditor or
actuary, or in any other capacity, for the
20
co-operative; or
(c) a person who has, or at any time had, in
his or her possession any property of
the co-operative; or
(d) a person who is indebted to the co-
25
operative; or
(e) a person who is capable of giving
information relating to the affairs of the
co-operative; or
(f) a person whom an investigator believes
30
on reasonable grounds to be a person
referred to in paragraphs (a) to (e).
404. Appointment of investigators
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(1) The Minister may appoint a person or persons to
hold an inquiry into the affairs of a co-operative if
the Minister considers that it is desirable to do so
for the protection or otherwise in the interests of
the public or of the members or creditors of the
5
co-operative.
(2) The Minister may vary the terms and conditions of
appointment of an investigator if the investigator
agrees to the variation.
(3) In the course of an inquiry into the affairs of a co-
10
operative, an investigator may inquire into the
affairs of a subsidiary of the co-operative that, if
the subsidiary were the co-operative, would be
affairs of the co-operative.
(4) An inquiry into the affairs of a subsidiary of a co-
15
operative may be conducted as if the subsidiary
were the co-operative.
405. Powers of investigators
(1) An investigator inquiring into the affairs of a co-
operative may, by giving an involved person a
20
notice in the prescribed form, require the person--
(a) to produce any document of which the
person has custody or control and which
relates to those affairs; or
(b) to give the investigator all reasonable
25
assistance in connection with the inquiry; or
(c) to appear before the investigator for
examination on oath or affirmation.
(2) An investigator may administer an oath or
affirmation to an involved person given a notice
30
under sub-section (1).
(3) An investigator may take possession of a
document produced by an involved person under
sub-section (1) and may retain it for the period
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that the investigator decides is necessary for the
inquiry.
(4) While an investigator retains possession of a
document, the investigator must permit a person
who would be entitled to inspect the document
5
were it not in the possession of the investigator to
inspect the document at any reasonable time and
make a copy of, or take extracts from, the
document.
406. Examination of involved person
10
(1) A legal practitioner acting for an involved
person--
(a) may attend an examination of the involved
person by an investigator; and
(b) may, to the extent that the investigator
15
permits, address the investigator and
examine the involved person.
(2) An involved person is not excused from
answering a question asked by the investigator
even if seeking to be excused on the ground of
20
possible self-incrimination.
(3) If an involved person answers a question of an
investigator after having claimed possible self-
incrimination by doing so, neither the question nor
the answer is admissible in evidence in any
25
criminal proceedings other than--
(a) proceedings under section 408 for giving a
false or misleading answer to the question; or
(b) proceedings on a charge of perjury in respect
of the answer.
30
(4) An involved person who attends for examination
by an investigator is entitled to be paid the
prescribed allowance and the prescribed expenses.
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407. Privilege
(1) An involved person who is a legal practitioner is
entitled to refuse to produce a document to an
investigator if the document contains a privileged
communication made by or on behalf of or to the
5
legal practitioner in his or her capacity as a legal
practitioner.
(2) The legal practitioner is not entitled to refuse to
produce the document if the person by or on
behalf of whom the communication was made or
10
(if the person is under administration under Part
5.3A of the Corporations Law, as adopted and
applying under this Act, or in the course of being
wound up) the administrator or the liquidator
agrees to the legal practitioner producing the
15
document.
(3) If the legal practitioner refuses to comply with the
requirement to produce a document , he or she
must immediately furnish in writing to the
investigator--
20
(a) the name and address of the person to whom
or by or on behalf of whom the
communication was made (if known to the
legal practitioner); and
(b) sufficient particulars to identify the
25
document.
Penalty: 60 penalty units.
408. Offences by involved person
(1) An involved person must not--
(a) refuse or fail to comply with a lawful
30
requirement of an investigator without
showing reasonable cause for the refusal or
failure; or
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(b) give an investigator information knowing the
information to be false or misleading in a
material particular; or
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(c) when appearing before an investigator--
(i) make a statement knowing the
statement to be false or misleading in a
material particular; or
(ii) fail to be sworn or to make an
5
affirmation
Penalty: 240 penalty units or imprisonment for 2
years, or both.
(2) If an investigator considers that a refusal or failure
by a person to comply with a requirement of the
10
investigator is an offence under sub-section (1)(a),
the investigator may certify the refusal or failure
to the Supreme Court and the Supreme Court may
then--
(a) order the involved person to comply with the
15
requirement of the investigator within a
stated period; or
(b) instead of, or in addition to, making that
order, punish the involved person as for a
contempt of the Supreme Court if satisfied
20
that there was no lawful excuse for the
refusal or failure to comply with the
requirement of the investigator.
409. Offences relating to documents
If an inquiry into the affairs of a co-operative is
25
being held under this Division, a person who--
(a) conceals, destroys, mutilates or alters a
document relating to the co-operative; or
(b) sends, or causes to be sent, out of the State
any document or other property that belongs
30
to, or is under the control of, the co-
operative--
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is guilty of an offence and liable to a penalty not
exceeding 120 penalty units or 12 months
imprisonment, or both, unless it is established that
the person charged did not intend to defeat, delay
or obstruct the inquiry.
5
410. Record of examination
(1) Except as provided by section 406, a record of an
examination may be used in proceedings against
the person examined, but this does not preclude
the admission of other written or oral evidence.
10
(2) A person examined is, on written application
made to the investigator, entitled to a free copy of
the record of examination.
(3) The Registrar may provide a legal practitioner
with a copy of a record of examination made by an
15
investigator if the Registrar is satisfied that the
legal practitioner is conducting, or is in good faith
contemplating, legal proceedings in respect of
affairs of the co-operative to which the record
relates.
20
(4) A legal practitioner must not--
(a) use a copy of a record of examination
otherwise than in connection with the
preparation for, institution of, or conduct of,
legal proceedings; or
25
(b) publish or communicate the record or any
part of it for any other purpose.
Penalty: 60 penalty units.
411. Report of investigator
(1) An investigator may, and if directed by the
30
Registrar to do so must, make interim reports to
the Registrar on any inquiry being held by the
investigator.
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(2) As soon as practicable after the end of an inquiry,
the investigator must report to the Registrar--
(a) the opinion of the investigator in relation to
the affairs of the co-operative the subject of
the inquiry; and
5
(b) the findings on which the opinion is based.
(3) An investigator's report may include a
recommendation as to whether--
(a) an order should be made under section
414(3); or
10
(b) an application should be made under section
414(4) or (5); or
(c) an order and an application should both be
made.
(4) A report by an investigator may be accompanied
15
by any document of which the investigator has
taken possession after being produced under this
Division, in which case the Registrar--
(a) may retain the document for the period that
the Registrar considers necessary in order to
20
decide whether legal proceedings should be
instituted as a result of the inquiry; and
(b) may retain the document for any further
period that the Registrar considers to be
necessary to enable legal proceedings to be
25
instituted and prosecuted; and
(c) may permit the use of the document for any
legal proceedings instituted as a result of the
inquiry; and
(d) must permit inspection of the document by a
30
person who would be entitled to inspect it if
it were returned to its former custody; and
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(e) may permit inspection of the document by
another person while it is in the possession
of the Registrar but only if the Registrar
considers that the person has an interest in
the inquiry and, because of that interest,
5
refusal of the inspection would be unjust.
412. Proceedings following inquiry
(1) If legal proceedings are to be, or have been,
instituted by the Registrar as a result of an inquiry
under this Division, the Registrar may, by order,
10
require a person who, in relation to the inquiry,
was an involved person to give all such assistance
in connection with the proceedings as the person
is reasonably able to give.
(2) The Supreme Court may, on the application of the
15
Registrar, order a person to comply with an order
under sub-section (1) if the person has refused or
failed to do so.
(3) If the Registrar considers that, as a result of an
inquiry under this Division, legal proceedings
20
should, in the public interest, be instituted by a co-
operative for the recovery of--
(a) damages in respect of fraud or other
misconduct in connection with the affairs of
the co-operative; or
25
(b) property of the co-operative--
the proceedings may be instituted and prosecuted
in the name of the co-operative.
413. Admission of investigator's report as evidence
(1) A document certified by the Registrar as being a
30
copy of a report of an inquiry under this Division
is admissible as evidence of any findings made by
the investigator.
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(2) Sub-section (1) does not authorise the admission
of evidence that is inadmissible under section 406.
414. Costs of inquiry
(1) The costs of an inquiry under this Division are to
be paid out of money appropriated by Parliament.
5
(2) At the direction of the Treasurer, the Registrar
must act under one or more of sub-sections (3), (4)
and (5).
(3) The Registrar may, by order served on a co-
operative, direct the co-operative to pay to the
10
Crown all or part of the costs of an inquiry under
this Division into the affairs of the co-operative.
(4) If proceedings are instituted by the Registrar under
section 412 in the name of a co-operative, the
court may, in the course of the proceedings and on
15
the application of the Registrar, order that all or
part of the costs of the inquiry that led to the
proceedings be paid to the Crown by a specified
party to the proceedings.
(5) If a person is convicted of an offence in
20
proceedings certified by the Registrar to be the
result of an inquiry into the affairs of a co-
operative, the court may, on the application of the
Registrar made at the time of the conviction or not
more than 14 days later, order the convicted
25
person to pay to the Crown all or part of the costs
of the inquiry.
(6) An order under this section must state--
(a) the amount to be paid; and
(b) the time or times for payment; and
30
(c) the manner of payment.
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(7) An amount that has not been paid by a person in
accordance with an order under this section is
recoverable from the person by the Registrar as a
debt due to the Crown.
Division 3--Prevention of fraud etc.
5
415. Falsification of records
A person must not make, order or allow to be
made any entry or erasure in, or any omission
from--
(a) any accounts or accounting records of a co-
10
operative or of a subsidiary of a co-operative;
or
(b) any return, document or other record
required to be sent, kept or delivered for the
purposes of this Act--
15
with intent to falsify them or it, or to evade any of
the provisions of this Act.
Penalty: 60 penalty units.
416. Fraud or misappropriation
(1) A person must not--
20
(a) by false representation or imposition, obtain
possession of any property of a co-operative;
or
(b) having any property of a co-operative in his
or her possession, withhold or misapply it or
25
wilfully apply any part of it to purposes other
than those authorised by the rules of the co-
operative or by this Act.
Penalty: 60 penalty units.
(2) A person who is found guilty of an offence under
30
sub-section (1) must, if ordered to do so by the
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court, deliver up all such property and repay all
money improperly applied.
Penalty: 60 penalty units or imprisonment for 6
months, or both.
417. Offering or paying commission
5
A person must not offer or pay any commission,
fee or reward, whether pecuniary or otherwise, to
an officer of a co-operative for or in connection
with a transaction or proposed transaction between
the person and the co-operative.
10
Penalty: 60 penalty units or imprisonment for 6
months, or both.
418. Accepting commission
(1) An officer of a co-operative must not accept any
commission, fee or reward, whether pecuniary or
15
otherwise, from any person for or in connection
with a transaction or proposed transaction between
the person and the co-operative.
Penalty: 60 penalty units or imprisonment for 6
months, or both.
20
(2) An officer of a co-operative who is guilty of any
offence under sub-section (1) is also liable to
make good to the co-operative double the value or
amount of the commission, fee or reward.
419. False statements in loan application etc.
25
(1) A person must not in or in relation to any
application, request or demand for money made to
or of any co-operative--
(a) give any information or makes any statement
to the co-operative or an officer, employee or
30
agent of the co-operative knowing it to be
false or misleading in a material particular;
or
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(b) proffer to the co-operative or an officer,
employee or agent of the co-operative any
information or statement provided by any
other person knowing it to be false or
misleading in a material particular.
5
Penalty: 60 penalty units or imprisonment for 6
months, or both.
(2) If a person is convicted of an offence under sub-
section (1), a co-operative from which money has
been obtained by the person in relation to the
10
commission of the offence may exercise all such
rights under a mortgage or other security given to
it by the person to secure the repayment of money
as it could exercise if there were a breach of a
covenant or of a term of any contract by which the
15
security was given.
(3) The co-operative may exercise those rights
whether the mortgage or other security was
executed by the person alone or by the person and
another person or other persons.
20
Division 4--Miscellaneous powers of the Registrar
420. Application for special meeting or inquiry
(1) The Registrar must, on the application of a
majority of the members of the board or of not
less than one-third in number of the members of a
25
co-operative--
(a) call a special meeting of the co-operative; or
(b) hold, or appoint an inspector to hold, an
inquiry into the affairs of the co-operative or
of a subsidiary of the co-operative.
30
(2) An application must be supported by such
evidence as the Registrar directs for the purpose of
showing that the applicants have good reason for
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requiring the meeting or inquiry and that the
application is made without malicious motive.
(3) Notice of the application must be given to the co-
operative as the Registrar directs.
(4) The applicants must give such security for the
5
expenses of the meeting or inquiry as the Registrar
directs.
421. Holding of special meeting
(1) The Registrar may direct the time and place at
which the special meeting is to be held and the
10
matters that are to be discussed and determined at
the meeting.
(2) The Registrar must give such notice to members
of the holding of the special meeting as the
Registrar considers appropriate (despite any
15
provision in the co-operative's rules as to the
giving of notice).
(3) The special meeting has all the powers of a
meeting called in accordance with the rules of the
co-operative and has power to appoint its own
20
chairperson (despite any rule of the co-operative
to the contrary).
(4) The Registrar or any person nominated by the
Registrar for the purpose may attend and address
the meeting.
25
422. Expenses of special meeting or inquiry
The expenses of and incidental to a meeting
called or an inquiry held under this Division
(including under section 423) must be defrayed in
such proportions as the Registrar directs--
30
(a) by the applicants (if any); or
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(b) out of the funds of the co-operative to which
the meeting or inquiry related or whose
subsidiary was the subject of the inquiry; or
(c) by any officer, member, former officer or
former member of the co-operative.
5
423. Power to hold special inquiry into co-operative
The Registrar may without any application hold,
or appoint an inspector to hold, an inquiry into the
working and financial condition of a co-operative
or a subsidiary of a co-operative.
10
424. Special meeting following inquiry
(1) On completion of any inquiry under this Division,
the Registrar may call a special meeting of the co-
operative.
(2) Sections 421 and 422 apply to such a meeting.
15
425. Information and evidence
(1) On any application for registration of a co-
operative or registration or approval of any rule or
document under this Act, the Registrar may
require from the applicant such information and
20
evidence as may be reasonable in order to show
that the application should be granted.
(2) The Registrar may require from any co-operative
such information and evidence as may be
reasonable in order to show that the co-operative
25
is bona fide carrying on business in accordance
with the provisions of this Act.
(3) The Registrar may require from a co-operative
such evidence as the Registrar thinks proper of all
matters required to be done and of the entries in
30
any document required to be furnished to the
Registrar under this Act.
426. Extension or abridgment of time
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(1) The Registrar may grant an extension of, or may
abridge, any time for doing anything required to
be done by a co-operative by this Act, the
regulations or the rules of a co-operative on such
terms (if any) as the Registrar determines.
5
(2) The Registrar may grant an extension of time even
if the time for doing the thing has expired.
427. Power of Registrar to intervene in proceedings
(1) The Registrar may intervene in any proceedings
relating to a matter arising under this Act or the
10
regulations.
(2) When the Registrar intervenes in proceedings, the
Registrar is taken to be a party to the proceedings
and, subject to this Act, has all the rights, duties
and liabilities of such a party.
15
(3) The Registrar may appear and be represented in
any proceedings in which the Registrar wishes to
intervene pursuant to this section--
(a) by a person to whom the Registrar has
delegated the Registrar's functions under this
20
Act or such of those functions as relate to a
matter to which the proceedings relate, or
(b) by an officer or temporary employee of the
public service who is engaged in the
administration of this Act, or
25
(c) by a legal practitioner.
_______________
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PART 16--ADMINISTRATION OF THIS ACT
Division 1--The Registrar
428. Appointment of Registrar
There is to be appointed under the Public Sector
Management Act 1992 a Registrar of Co-
5
operatives for the purposes of this Act.
429. Registrar's functions
(1) Subject to this Act, the Registrar is responsible for
the general administration of this Act.
(2) The Registrar has the functions that are conferred
10
on the Registrar by or under this Act.
(3) The Registrar must have a seal of office.
(4) The Registrar may enter into any arrangements or
agreements with any person or body to act as the
agent of the Registrar in the carrying out of his or
15
her functions.
430. Deputy Registrar and other staff
(1) There is to be appointed under the Public Sector
Management Act 1992 a Deputy Registrar and
Assistant Registrars as are necessary for the
20
purposes of this Act.
(2) The Deputy Registrar or an Assistant Registrar
may exercise any of the functions conferred on the
Registrar.
431. Delegation by Registrar
25
(1) The Registrar may by instrument delegate to any
officer or employee of the public service any of
the Registrar's functions including this power of
delegation.
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(2) A delegate may by instrument sub-delegate to an
officer or employee of the public service any
function delegated under this section if the
delegate is authorised by the terms of the
delegation to do so.
5
432. Register of Co-operatives
(1) There is established a Register of Co-operatives
for the purposes of this Act.
(2) The Registrar must record in the Register those
documents relating to co-operatives and proposed
10
co-operatives lodged with the Registrar which the
Minister requires by order published in the
Government Gazette to be recorded in the
Register.
433. Keeping of registers
15
(1) The Registrar must keep the Register of Co-
operatives and such other registers as the
Registrar considers necessary or desirable for the
purposes of this Act.
(2) Subject to section 432, a register must be kept in
20
the form and contain the particulars that the
Registrar thinks fit.
(3) Subject to section 434, any document lodged with,
furnished to or registered by the Registrar under
this Act must be kept in the office of the Registrar.
25
434. Disposal of records by Registrar
Subject to the Public Records Act 1973, the
Registrar may, if in the opinion of the Registrar it
is no longer necessary or desirable to retain them,
destroy or dispose of any of the following--
30
(a) any annual return or balance-sheet lodged
more than 7 years ago;
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(b) any document creating or evidencing a
charge, or the complete or partial satisfaction
of a charge, if a memorandum of satisfaction
of the charge was registered more than 7
years ago;
5
(c) any other document (except the rules or any
document affecting the rules of a co-
operative) that was lodged, furnished or
registered more than 15 years ago;
(d) any document lodged, furnished or registered
10
in relation to a co-operative that was
dissolved or ceased to be registered more
than 15 years ago;
(e) any document a transparency or electronic
image of which has been incorporated with a
15
register kept by the Registrar or is otherwise
kept in the office of the Registrar.
435. Inspection of Register
(1) A person may--
(a) inspect the Register on payment of the
20
prescribed fee (if any); and
(b) inspect prescribed documents or documents
of a prescribed class kept by the Registrar
relating to a co-operative on payment of the
prescribed fee (if any); and
25
(c) obtain, on payment of the prescribed fee, a
certified copy of a document that the person
may inspect under paragraph (b); and
(d) obtain, on payment of the prescribed fee, a
copy of a document that the person may
30
inspect under paragraph (b).
(2) If a reproduction or transparency of a document or
an extract of information contained in a document
and recorded in the Register is produced for
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inspection, a person is not entitled under sub-
section (1) to require the production of the original
of that document.
436. Approvals by Registrar
(1) This section applies to any provision of this Act
5
which imposes a requirement for the Registrar's
approval of any action or thing.
(2) The Registrar may indicate in writing to an
applicant for such an approval that the approval is
to be considered to have been granted at the end of
10
a specified period unless the Registrar informs the
applicant in writing within that period that the
approval has not been granted or is still being
considered.
437. Lodgment of documents
15
A document is not to be taken to have been
lodged under this Act or the regulations unless--
(a) all information required to be provided in or
with the document is provided; and
(b) the prescribed fee (if any) has been paid.
20
438. Method of lodgment
(1) Subject to section 437, it is sufficient compliance
with a requirement under this Act or the
regulations that a document be lodged with the
Registrar if the Registrar receives a copy of the
25
document by facsimile or electronic transmission.
(2) If the Registrar receives from a person a copy of a
document under sub-section (1), the Registrar may
require that person to produce and lodge the
original within the time specified by the Registrar.
30
(3) If the person does not comply with a requirement
of the Registrar within the specified time, the
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person is to be taken not to have lodged the
document.
439. Power of Registrar to refuse to register or reject
documents
(1) The Registrar may refuse to register or may reject
5
a document submitted to the Registrar if the
Registrar considers that the document--
(a) contains matter contrary to law; or
(b) contains matter, that in a material particular,
is false or misleading in the form or context
10
in which it is included; or
(c) by reason of an omission or misdescription,
has not been duly completed; or
(d) does not comply with the requirements of
this Act; or
15
(e) contains any error, alteration or erasure.
(2) If the Registrar refuses to register or rejects a
document under sub-section (1), the Registrar may
request--
(a) that the document be appropriately amended;
20
or
(b) that a fresh document be submitted in its
place; or
(c) if the document has not been duly completed,
that a supplementary document in the form
25
approved by the Registrar be submitted.
Division 2--Evidence
440. Certificate of registration
(1) A certificate of registration of a co-operative
issued under this Act is conclusive evidence that
30
the co-operative is incorporated under this Act and
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that all the requirements of this Act in respect of
registration have been complied with.
(2) This section does not affect any provisions of this
Act for the winding up or dissolution of the co-
operative or the cancellation of its registration.
5
441. Certificate evidence
(1) If a function under this Act is conferred or
imposed on the Registrar as a consequence of
something being done or omitted to be done
within a specified period, the Registrar may
10
certify--
(a) that the thing had or had not been done
within that period; or
(b) that the thing had or had not been done by a
specified date.
15
(2) The Registrar may issue a certificate stating that a
requirement of this Act specified in the
certificate--
(a) had, or had not, been complied with at a date
or within a period specified in the certificate,
20
or
(b) had been complied with at a date specified in
the certificate but not before that date.
(3) The Registrar may issue a certificate stating that
on a date specified in the certificate a body
25
specified in the certificate was not or had ceased
to be registered as a co-operative under this Act.
(4) A certificate given by the Registrar under this
section is evidence of the matters stated in the
certificate.
30
442. Orders published in the Government Gazette
A copy of an order, notice, exemption or other
instrument published in the Government Gazette
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purporting to have been given or issued under this
Act or the regulations is evidence of the giving or
issuing of the order, notice, exemption or other
instrument of which it purports to be a copy.
443. Records kept by co-operatives
5
(1) A record kept by a co-operative under a
requirement of this Act is admissible in evidence
in any proceedings and is evidence of any matter
stated or recorded in the record.
(2) A document purporting to be a record kept by a
10
co-operative is, unless the contrary is proved, to be
considered to be a record kept by the co-operative
under a requirement of this Act.
(3) A copy of any entry in a record regularly kept by a
co-operative in the course of its business is, if
15
verified by statutory declaration of the secretary to
be a true copy of the entry, to be received in
evidence in any case where and to the same extent
as the original entry itself is admissible.
444. Minutes
20
(1) Every entry in the minutes purporting to be a
minute of the business transacted at a meeting of a
co-operative or of the board, and purporting to
have been signed by the chairperson at a
subsequent meeting, is evidence that the business
25
recorded in the minute was transacted at the
meeting and that the meeting was duly convened
and held.
(2) An entry in the minutes of a meeting of a co-
operative to the effect that a resolution was carried
30
or carried unanimously, or was lost, is evidence of
the fact without proof of the number or proportion
of votes recorded for or against the resolution.
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445. Official certificates
(1) A certificate of registration given by the Registrar
must be received in evidence as if it were the
original certificate.
(2) A certificate of registration or other official
5
document relating to a co-operative signed by or
bearing the seal of the Registrar is to be received
in evidence without further proof.
(3) A copy of rules certified by the Registrar to be a
true copy of the rules of a co-operative is evidence
10
of the registered rules of the co-operative.
446. The Registrar and proceedings
(1) Judicial notice must be taken of the signature or
the facsimile of the signature (by whatever process
it is produced) and seal of any person who holds
15
or has held the office of Registrar, if the signature
or facsimile signature or seal purports to be
attached to any certificate or other official
document.
(2) This section extends to any copy of the rules of a
20
co-operative certified by the Registrar to be a true
copy of its registered rules.
(3) In any proceedings, no proof is required (until
evidence is given to the contrary) of the
appointment of the Registrar or any former
25
Registrar.
447. Rules
A printed copy of the rules of a co-operative
verified by statutory declaration of the secretary of
the co-operative to be a true copy of its registered
30
rules is in any proceedings evidence of the rules.
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448. Registers
The register of directors, members and shares of a
co-operative is evidence of the particulars directed
or authorised by or under this Act to be inserted in
the register.
5
_______________
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Act No.
PART 17--OFFENCES AND PROCEEDINGS
449. Offences by officers of co-operatives
(1) If a co-operative contravenes a provision of this
Act or the regulations--
(a) any person who is a director of the co-
5
operative or concerned in its management is
taken to have contravened the same
provision if the person knowingly authorised
or permitted the contravention; and
(b) any other officer of the co-operative who by
10
a wilful act or omission is the cause of the
contravention is taken to have contravened
the same provision.
(2) A person may be proceeded against and convicted
under a provision pursuant to sub-section (1)
15
whether or not the co-operative has been
proceeded against or convicted under that
provision.
(3) This section does not affect any liability imposed
on a co-operative for an offence committed by the
20
co-operative against this Act.
450. Notice to be given of conviction for offence
If a co-operative or an officer of a co-operative is
convicted of an offence against a provision of this
Act or the regulations, the co-operative must, not
25
later than 28 days after the conviction is recorded,
give to each member of the co-operative notice
of--
(a) the conviction; and
(b) any penalty imposed in respect of the offence
30
to which the conviction relates; and
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(c) the nature of the offence to which the
conviction relates.
451. Secrecy
(1) A person--
(a) who is, or at any time was, engaged in the
5
administration of this Act or the former Act;
and
(b) who, except as provided by this section,
records, makes use of or divulges any
information obtained in the course of that
10
administration--
is guilty of an offence and liable to a penalty not
exceeding 60 penalty units.
(2) Sub-section (1) does not apply to--
(a) the recording, making use of or divulging of
15
information in the course of the
administration of this Act; or
(b) the recording or making use of information
for the purpose of divulging it as permitted
by sub-section (3) or (4); or
20
(c) the divulging of information as permitted by
sub-section (3) or (4).
(3) Information may be divulged--
(a) for the purposes of criminal proceedings; or
(b) for the purposes of any proceedings under
25
this Act or of an inquiry authorised by an
Act; or
(c) with the consent of the person to whom the
information relates; or
(d) in accordance with a requirement imposed
30
under the Ombudsman Act 1973; or
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(e) in accordance with a reciprocal arrangement
under section 461.
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(4) Information may be divulged to--
(a) the Minister; or
(b) the Treasurer; or
(c) the Commissioner of State Revenue; or
(d) the Auditor-General; or
5
(e) the Commissioner of Taxation, a Second
Commissioner of Taxation or a Deputy
Commissioner of Taxation holding office
under a law of the Commonwealth; or
(f) the Australian Securities Commission; or
10
(g) the person who, under a law of another State,
or of a Territory, administers a law of the
State or Territory that relates to taxation or
the imposition of a duty; or
(h) any special commission (within the meaning
15
of the Evidence (Commissions) Act 1982)
if--
(i) the Registrar has received a written
request in writing for information from
the special commission; and
20
(ii) the Minister has given written approval
to the Registrar of the communication
of that information; and
(iii) the Registrar has given to that person
written approval of the communication
25
of the communication of that
information; or
(i) a person seeking information under a
reciprocal arrangement under section 461; or
(j) a member of the police force exercising
30
functions as such; or
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(k) a person nominated by a person referred to in
paragraphs (a) to (g); or
(l) any person, to whom, in the opinion of the
Registrar, it is in the public interest that the
information be divulged.
5
(5) For the purposes of this section, a person is, or
was, engaged in the administration of this Act or
the former Act if the person exercises, or at any
time exercised, a function as--
(a) the Registrar holding office under this Act or
10
the former Act; or
(b) an inspector appointed under this Act or the
former Act; or
(c) an investigator appointed under this Act; or
(d) a person appointed or employed for the
15
purposes of this Act or the former Act.
(6) In this section--
"divulge'', in relation to information, means--
(a) communicate the information verbally;
or
20
(b) make available a document containing
the information; or
(c) make available anything from which, by
electronic process or otherwise, the
information may be obtained; or
25
(d) communicate the information in any
other manner;
"former Act'' means the Co-operation Act 1981.
452. False or misleading statements
(1) A person who, in a document required for the
30
purposes of this Act or lodged with the Registrar
makes, or authorises the making of, a statement
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knowing it to be false or misleading in a material
particular is guilty of an offence and liable to a
penalty not exceeding 120 penalty units.
(2) A person who, from a document required for the
purposes of this Act or lodged with the Registrar
5
omits, or authorises the omission of, anything
knowing that the omission makes the document
misleading in a material particular is guilty of an
offence and liable to a penalty not exceeding 120
penalty units.
10
(3) A person who, in a document required for the
purposes of this Act or lodged with the Registrar
makes, or authorises the making of, a statement
that is false or misleading in a material particular
is guilty of an offence and liable to a penalty not
15
exceeding 60 penalty units unless it is proved that
the person had taken reasonable precautions aimed
at avoiding the making or authorising of false or
misleading statements in such a document.
(4) If an omission makes a document required for the
20
purposes of this Act or lodged with the Registrar
misleading in a material respect, a person who
made or authorised the omission is guilty of an
offence and liable to a penalty not exceeding 60
penalty units unless it is proved that the person
25
had taken reasonable precautions aimed at
avoiding the making or authorising of omissions
that would make such a document false or
misleading.
453. Further offence for continuing failure to do required
30
act
(1) If a provision of this Act requires an act to be done
and it has not been done, the obligation to do the
act continues until the act is done--
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(a) even if a person has been convicted of an
offence in relation to the failure to do the act;
and
(b) even if the provision required the act to be
done within a particular period or before a
5
particular time and that period has ended or
that time has passed.
(2) If a person is convicted of an offence ("a primary
conviction'') for a failure to do the act (whether it
is the first or a second or subsequent offence in
10
relation to the failure) and the failure to do the act
continues after the time of the conviction, the
person is guilty of a further offence for that
continuing failure.
(3) That further offence is constituted by the failure to
15
do the act during the period that begins with the
primary conviction and ends when proceedings for
the further offence are commenced or the act
concerned is done (whichever happens first). This
period is "the further offence period''.
20
(4) Proceedings for the further offence are to be
considered to have been commenced on the day on
which the information for the further offence is
laid or on such earlier day as the information may
specify for that purpose.
25
(5) The maximum penalty for the further offence is
the penalty calculated by multiplying $50 by the
number of days in the further offence period.
454. Civil remedies
(1) If a co-operative in making, guaranteeing or
30
raising any loan or receiving any deposit
contravenes any provision of this Act or the
regulations or any rule of the co-operative, the
civil rights and liabilities of the co-operative or
any other person in respect of the recovery of the
35
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loan or deposit are not affected or prejudiced by
the contravention but the money becomes
immediately payable.
(2) The same remedies may be had for the recovery of
the loan or deposit and for the enforcement of any
5
security for it as if there had not been a
contravention of this Act or the regulations or of
the rules of the co-operative.
455. Injunctions
(1) If the Supreme Court is satisfied on the
10
application of the Registrar or a person whose
interests have been, are or would be affected by
the conduct that another person has engaged, is
engaging or is proposing to engage in conduct that
constituted, constitutes or would constitute--
15
(a) a contravention of this Act or the regulations;
or
(b) attempting to contravene this Act or the
regulations; or
(c) aiding, abetting, counselling or procuring a
20
person to contravene this Act or the
regulations; or
(d) inducing or attempting to induce, whether by
threats, promises or otherwise, a person to
contravene this Act or the regulations; or
25
(e) being in any way, directly or indirectly,
knowingly concerned in, or party to, the
contravention by a person of this Act or the
regulations; or
(f) conspiring with others to contravene this Act
30
or the regulations--
the Supreme Court may grant an injunction on
such terms as the Supreme Court thinks
appropriate, restraining that other person from
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engaging in the conduct and, if in the opinion of
the Supreme Court it is desirable to do so,
requiring that other person to do any act or thing.
(2) If in the opinion of the Supreme Court it is
desirable to do so, the Court may grant an interim
5
injunction pending determination of the
application.
(3) The Supreme Court may discharge or vary an
injunction granted under this section.
(4) The power of the Supreme Court to grant an
10
injunction restraining a person from engaging in
conduct may be exercised--
(a) whether or not it appears to the Court that the
person intends to engage again, or to
continue to engage, in conduct of that kind;
15
and
(b) whether or not the person has previously
engaged in conduct of that kind; and
(c) whether or not there is an imminent danger
of substantial damage to any person if the
20
first-mentioned person engages in conduct of
that kind.
(5) The power of the Supreme Court to grant an
injunction requiring a person to do an act or thing
may be exercised--
25
(a) whether or not it appears to the Court that the
person intends to refuse or fail again, or to
continue to refuse or fail, to do that act or
thing; and
(b) whether or not the person has previously
30
refused or failed to do that act or thing; and
(c) whether or not there is an imminent danger
of substantial damage to any person if the
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first-mentioned person refuses or fails to do
that act or thing.
(6) If the Supreme Court has power under this section
to grant an injunction restraining a person from
engaging in particular conduct, or requiring a
5
person to do a particular act or thing, the Court
may, either in addition to or in substitution for the
grant of the injunction, order that person to pay
damages to any other person.
456. Proceedings for offences etc.
10
(1) Proceedings for an offence under this Act may be
instituted at any time before the expiration of 3
years after the alleged commission of the offence.
(2) Proceedings for an offence may be instituted by
the Registrar or any aggrieved person.
15
(3) Proceedings for the recovery of any fine or penalty
imposed by the rules of a co-operative may be
instituted only by the co-operative.
_______________
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s. 457
Act No.
PART 18--GENERAL
457. Exemption from stamp duty
No stamp duty is payable in respect of any of the
following instruments--
(a) the certificate of registration of a co-
5
operative;
(b) a share certificate or any other instrument
issued or executed in connection with the
capital of a co-operative.
458. Co-operative ceasing to exist
10
(1) As soon as practicable after a co-operative is
dissolved or has otherwise ceased to exist, the
Registrar must register the dissolution and cancel
the registration of the co-operative.
(2) The Registrar may remove from any register kept
15
by the Registrar the name of any co-operative that
has been dissolved or otherwise ceased to exist.
(3) A co-operative that has transferred its
engagements to another co-operative is to be
considered to have ceased to exist.
20
459. Service of documents on co-operative
(1) A document may be served on a co-operative by
post or by leaving it at the registered office of the
co-operative with a person who appears to be aged
16 or more.
25
(2) A document may be served on a foreign co-
operative--
(a) by post; or
(b) by leaving it with a person who appears to be
aged 16 or more and is at a place where the
30
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foreign co-operative carries on business in
Victoria; or
(c) by leaving it at the registered office in
Victoria of the foreign co-operative
registered under Part 14.
5
(3) For the purpose of serving a document under this
section by post, it is properly addressed if--
(a) in the case of a co-operative, it is addressed
to the registered office of the co-operative; or
(b) in the case of a foreign co-operative, it is
10
addressed to a place in Victoria where the
foreign co-operative carries on business.
(4) This section does not affect the operation of any
provision of a law or of the rules of a court
authorising a document to be served on a co-
15
operative or a foreign co-operative in any other
way.
460. Service on member of co-operative
(1) A notice required under this Act to be given to a
member of a co-operative must be in writing.
20
(2) A notice or other document required under this
Act to be given to a member of a co-operative may
be given--
(a) personally; or
(b) by post; or
25
(c) by publishing the notice in a newspaper
circulating generally in Victoria or in the
area served by the co-operative, if--
(i) the co-operative is a non-trading co-
operative; or
30
(ii) the member's whereabouts are unknown
to the co-operative; or
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(iii) the Registrar permits notice to be given
to members of that co-operative in that
manner.
461. Reciprocal arrangements
(1) If a reciprocal arrangement with another State or a
5
Territory is in force, the Registrar--
(a) may, at the request of the appropriate official
of the State or Territory, provide the official
with information or documents relating to a
co-operative; and
10
(b) may request the appropriate official of the
State or Territory to provide the Registrar
with documents or information relating to an
organisation that, under the arrangement, is
an organisation corresponding to a co-
15
operative.
(2) A reciprocal arrangement with another State or a
Territory is an arrangement made between the
Minister and a representative of the government of
the other State or the Territory under which it is
20
agreed--
(a) that the Registrar will comply with a request
referred to in sub-section (1)(a); and
(b) that a request made by the Registrar to an
official designated in the arrangement as the
25
appropriate official for the purposes of sub-
section (1)(b) will be complied with.
462. Translations of documents
A requirement imposed by or under this Act to
furnish or lodge a document or make a document
30
available for inspection is, in the case of a
document that is not in the English language, to be
considered to include a requirement that a
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translation of the document be furnished, lodged
or made available for inspection at the same time.
463. Regulations
(1) The Governor in Council may make regulations
not inconsistent with this Act for or with respect
5
to any matter that by this Act is required or
permitted to be prescribed or that is necessary or
convenient to be prescribed for carrying out or
giving effect to this Act.
(2) Without affecting the generality of sub-section (1),
10
regulations may be made for or with respect to the
following--
(a) the making of applications for the exercise of
a function by the Registrar, including the use
of a form approved by the Registrar;
15
(b) the manner of lodgment of documents with
the Registrar (including electronic lodgment
and lodgment by facsimile);
(c) fees to be paid in connection with the
administration of this Act including fees for
20
lodgment of any documents under this Act
and additional fees for late lodgment of any
documents under this Act.
(3) A regulation may create an offence punishable by
a penalty not exceeding 20 penalty units.
25
(4) Regulations relating to fees--
(a) may prescribe different fees for different
classes of cases;
(b) may authorise the Registrar to waive, reduce
or refund fees in particular cases or classes of
30
cases.
_______________
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s. 464
Act No.
PART 19--REPEALS, AMENDMENTS, SAVINGS AND
TRANSITIONAL
464. Repeal of Co-operation Act 1981
The Co-operation Act 1981 is repealed.
465. Repeal of Part VI of the Housing Act 1983
5
Part VI of the Housing Act 1983 is repealed.
466. Savings and transitional provisions
Schedule 5 has effect.
467. Amendment of other Acts
Each Act specified in an item in Schedule 6 is
10
amended as set out in that item.
__________________
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SCHEDULES
SCHEDULE 1
MATTERS FOR WHICH RULES MUST MAKE PROVISION
1. Requirements for all co-operatives
5 The rules of all co-operatives must set out or make provision
for each of the following--
1. The name of the co-operative;
2. Active membership provisions (within the meaning of
Part 6);
10 3. The mode and conditions of admission to
membership, and the payment to be made or the share
or interest to be acquired before rights of membership
are exercised;
4. The rights and liabilities of members, and of the
15 estates of deceased members, and the rights and
liabilities of representatives of members under
bankruptcy or mental incapacity;
5. The circumstances in which members may be expelled
or suspended, and the rights and liabilities of expelled
20 and suspended members;
6. The circumstances in which membership ceases.
7. Any charges or subscriptions which are to be payable
by a member to the co-operative;
8. The circumstances in which fines and forfeitures may
25 be imposed on members of the co-operative, and the
amount of the fines, not exceeding the prescribed
maximum amount;
9. The grievance procedures for settling disputes under
the rules between the co-operative and any of its
30 members as defined in section 88, or between a
member and any other member;
10. The restrictions, if any, on the powers of the co-
operative and the board;
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11. The number of directors, the qualification of directors,
and the manner of electing, remunerating and
removing directors and filling a vacancy, the period
for which directors are to hold office, and whether
5 directors are to retire by rotation or otherwise and for
the holding of annual elections;
12. The quorum for meetings, and the procedure at
meetings, of the board;
13. The device, custody and use of the seal of the co-
10 operative;
14. The manner in which the funds of the co-operative are
to be managed, and in particular the mode of drawing
and signing cheques, drafts, bills of exchange,
promissory notes, and other negotiable instruments for
15 and on behalf of the co-operative;
15. Provision for the custody of securities belonging to
the co-operative;
16. The manner in which debentures may be transferred;
17. The date on which the financial year of the co-
20 operative concludes;
18. Provision for the accounts of the co-operative to be
audited annually or more frequently and the manner of
appointment of the auditor;
19. The manner in which any loss which may result from
25 the transactions of the co-operative is to be provided
for;
20. The manner of calling general and special meetings,
the requisite notices of meetings, and the quorum for
meetings, of the co-operative;
30 21. The procedure at meetings of the co-operative,
including the rights of members in voting at meetings,
the manner of voting, and the majority necessary for
carrying resolutions;
22. The method of conducting postal ballots, including
35 special postal ballots, including the sending and
lodgment of information and votes by facsimile or
electronic means;
23. The manner of altering the rules;
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24. The manner in which the co-operative may be wound-
up;
25. Any matters that may be prescribed, whether in
addition to or in substitution for any matter specified
5 in this clause;
26. Any other matters that to the co-operative appear
necessary or desirable.
2. Additional matters--co-operatives with share capital
In addition to the matters specified in clause 1, the rules of a
10 co-operative with a share capital must set out or make
provision for each of the following--
1. The nominal value of each share in the co-operative;
2. The amount of the contingent liability, if any,
attaching to shares;
15 3. The terms on which shares, not including bonus
shares, but including shares, if any, with a contingent
liability attached to them are to be issued;
4. The periodic subscriptions by which or the manner in
which shares are to be paid for;
20 5. In the case of a trading co-operative, the manner in
which any surplus may be distributed;
6. The allocation of a deficiency on the winding up of a
co-operative;
7. Provision for the forfeiture of shares on expulsion or
25 on failure to pay any subscription or call, the extent to
which members whose shares have been forfeited are
to remain liable for any amount still unpaid in respect
of them, and the sale or cancellation of forfeited
shares;
30 8. The manner in which shares may be transferred;
9. Any matters that may be prescribed, whether in
addition to or in substitution for any matter specified
in this clause.
3. Additional matters--non-trading co-operatives
35 In addition to the matters specified in clauses 1 and 2, the
rules of a non-trading co-operative must provide--
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1. That there must be no return or distribution on surplus
or share capital to members other than the nominal
value of shares (if any) at winding up;
2. For the manner of distribution of the surplus property
5 at winding up.
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SCHEDULE 2
RELEVANT INTERESTS, ASSOCIATES, RELATED BODIES
PART 1--RELEVANT INTERESTS
1. Terminology used in this Schedule
5 (1) This clause applies for the purposes of this Part.
(2) Power to vote in respect of a right to vote is power to
exercise, or to control the exercise of, the right to vote.
(3) A reference to power to dispose of a share includes a
reference to power to exercise control over the disposal of
10 the share.
(4) A reference to power or control includes a reference to
power or control that is direct or indirect or is, or can be,
exercised as a result of, by means of, in breach of, or by
revocation of, trusts, agreements and practices, or any of
15 them, whether or not they are enforceable.
(5) Power to vote in respect of a right to vote, or power to
dispose of a share, that is exercisable by 2 or more persons
jointly is to be considered to be exercisable by either or any
of those persons.
20 (6) A reference to a controlling interest includes a reference to
an interest that gives control.
2. Basic rules--relevant interests
(1) A person who has power to vote in respect of a right to vote
has a relevant interest in the right to vote.
25 (2) A person who has power to dispose of a share has a relevant
interest in the share.
3. Control of body corporate having power in relation to a share
If a body corporate has, or is by this Part to be considered to
have--
30 (a) power to vote in respect of a right to vote; or
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(b) power to dispose of a share--
a person is to be considered for the purposes of this Part to
have in relation to the right to vote or share the same power
as the body has, or is to be considered to have, if--
5 (c) the body is, or its directors are, accustomed or under
an obligation, whether formal or informal, to act in
accordance with the directions, instructions or wishes
of the person in relation to the exercise of the power
referred to in paragraph (a) or (b); or
10 (d) the person has a controlling interest in the body.
4. Control of 20% of voting power in body corporate having power
in relation to a share
If a body corporate or an associate of a body corporate has,
or is by this Part (other than this clause) to be considered to
15 have--
(a) power to vote in respect of a right to vote; or
(b) power to dispose of a share--
a person is to be considered for the purposes of this Part to
have in relation to the right to vote or share the same power
20 as the body or associate has, or is to be considered to have,
if--
(c) the person has; or
(d) an associate of the person has; or
(e) associates of the person together have; or
25 (f) the person and an associate or associates of the person
together have--
power to vote in respect of the right to vote attached to not
less than 20% of the voting shares in the body.
5. Deemed relevant interest in advance of performance of
30 agreement that will give rise to a relevant interest
If a person--
(a) has entered into an agreement with another person
with respect to an issued share or right to vote in
which the other person has a relevant interest; or
35 (b) has a right enforceable against another person in
relation to an issued share or right to vote in which the
other person has a relevant interest, whether the right
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is enforceable presently or in the future and whether
or not on the fulfilment of a condition; or
(c) has an option granted by another person, or has
granted to another person an option, with respect to an
5 issued share or right to vote in which the other person
has a relevant interest--
and, on performance of the agreement, enforcement of the
right, or exercise of the option, the first-mentioned person
would have a relevant interest in the share or right to vote,
10 the first-mentioned person is to be considered for the
purposes of this Part to have that relevant interest in the
share or right to vote.
6. Control of body corporate having a relevant interest by virtue of
clause 5
15 If a body corporate is by clause 5 to be considered to have a
relevant interest in a share in or right to vote at meetings of a
co-operative, a person is to be considered for the purposes of
this Part to have a relevant interest in the share or right to
vote if--
20 (a) the body corporate is, or its directors are, accustomed
or under an obligation, whether formal or informal, to
act in accordance with the directions, instructions or
wishes of the person in relation to the exercise of
power to vote in respect of that right to vote or power
25 to dispose of those shares; or
(b) the person has a controlling interest in the body
corporate; or
(c) the person has power to vote in respect of the right to
vote attached to not less than 20% of the voting shares
30 in the body corporate.
7. Matters not affecting application of Schedule
(1) It is immaterial for the purposes of this Part whether or not
power to vote in respect of a right to vote, or power to
dispose of a share--
35 (a) is express or implied or formal or informal; or
(b) is exercisable by a person alone or jointly with any
other person or persons; or
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(c) cannot be related to a particular share; or
(d) is, or can be made, subject to restraint or restriction.
(2) A relevant interest in a share or right to vote is not to be
disregarded merely because of either or both of the
5 following--
(a) its remoteness;
(b) how it arose.
8. Body corporate may have a relevant interest in its own shares
A body corporate may, by virtue of this Part, be considered
10 to have a relevant interest in a share in or right to vote
arising from membership of the body itself.
9. Exclusions--money-lenders
A relevant interest of a person in a share or right to vote is to
be disregarded if the person's ordinary business includes
15 lending money and the person has authority to exercise
powers as the holder of the relevant interest only because of
a security given for the purposes of a transaction entered into
in the ordinary course of business in connection with lending
money, other than a transaction entered into with an
20 associate of the person.
10. Exclusions--certain trustees
A relevant interest of a person in a share or right to vote is to
be disregarded if--
(a) the share or right is subject to a trust; and
25 (b) the person has the relevant interest as a trustee of the
trust; and
(c) either--
(i) a beneficiary under the trust is by clause 5 to be
considered to have a relevant interest in the
30 share or right because the beneficiary has a
presently enforceable and unconditional right
referred to in clause 5(b); or
(ii) the person is a bare trustee.
11. Exclusions--instructions to securities dealer to dispose of share
35 A relevant interest of a person in a share or right to vote is to
be disregarded if--
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(a) the person's ordinary business includes dealing in
securities; and
(b) the person has authority to exercise powers as the
holder of the relevant interest only because of
5 instructions given to the person, by or on behalf of
another person, to dispose of the share on the other
person's behalf in the ordinary course of that business.
12. Exclusions--honorary proxies
A relevant interest of a person in a share or right to vote is to
10 be disregarded if the person has it only because of having
been appointed, otherwise than for valuable consideration
given by the person or an associate of the person, to vote as
a proxy or representative at a meeting of members, or of a
class of members, of a body corporate.
15 13. Exclusions--holders of prescribed offices
A relevant interest of a person in a share or right to vote is to
be disregarded if the person has it because of holding a
prescribed office.
14. Prescribed exclusions
20 The regulations may provide that specified relevant interests
in specified shares are, in specified circumstances and
subject to specified conditions (if any), to be disregarded for
the purposes of specified provisions of this Act.
15. Effect of Schedule
25 (1) Nothing in this Schedule limits the generality of anything
else in it.
(2) A person does not have a relevant interest in a share of a co-
operative or right to vote in respect of a co-operative except
as provided in this Schedule.
30 16. Relevant interest--body corporate other than co-operative
A reference in this Act (including in this Schedule) to a
relevant interest in a share of a body corporate other than a
co-operative or a right to vote in respect of a body corporate
other than a co-operative is to be construed in accordance
35 with the Corporations Law.
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PART 2--ASSOCIATES
17. Effect of Part
A person is not an associate of another person except as
provided by this Part.
5 18. Associates of a body corporate
The associates of a body corporate include the following--
(a) a director or secretary of the body;
(b) a related body corporate;
(c) a director or secretary of a related body corporate.
10 19. Matters relating to voting rights
(1) If a reference to an associate of a person relates to--
(a) the extent of power to exercise, or to control the
exercise of, the voting power attached to voting
shares in or arising from membership of a body
corporate; or
15
(b) the person's entitlement to shares in a body
corporate; or
(c) an offer to purchase shares to which Division 2
of Part 11 applies--
20 the reference includes a reference to another person with
whom the person has, or proposes to enter into, an
agreement referred to in sub-clause (2).
(2) Sub-clause (1) applies to an agreement--
(a) because of which one of the persons referred to in
25 sub-clause (1) has or will have power (even if it is in
any way qualified)--
(i) to exercise; or
(ii) to control, directly or indirectly, the exercise of;
or
30 (iii) to influence substantially the exercise of--
any voting power attached to shares in the body; or
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(b) for the purpose of controlling or influencing--
(i) the composition of the body's board; or
(ii) the conduct of affairs of the body; or
(c) under which one of those persons--
5 (i) will or may acquire; or
(ii) may be required by the other to acquire--
shares in the body in which the other has a relevant
interest; or
(d) under which one of those persons may be required to
10 dispose of shares in the body in accordance with the
other's directions.
(3) Sub-clause (1) applies despite any other effect the agreement
may have.
(4) In relation to a matter relating to shares in a body corporate,
15 a person may be an associate of the body and the body may
be an associate of a person.
20. General
(1) A reference to an associate of a person includes a reference
to--
20 (a) any other person in concert with whom the person is
acting or proposes to act;
(b) any other person who, under the regulations, is, for the
purposes of the provision in which the reference
occurs, an associate of the person;
25 (c) any other person with whom the person is or proposes
to become associated, whether formally or informally,
in any other way--
in respect of the matter to which the reference relates.
(2) If a person has entered, or proposes to enter, into a
30 transaction, or has done, or proposes to do, any act or thing,
in order to become associated with another person as
mentioned in an applicable provision of this Part, a reference
to an associate of the person includes a reference to that
other person.
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21. Exclusions
A person is not an associate of another person by virtue of
clause 19 or 20(1), or by virtue of clause 20(2) as it applies
in relation to clause 19 or 20(1), merely because of one or
5 more of the following--
(a) one gives advice to the other, or acts on the other's
behalf, in the proper performance of the functions
attaching to a professional capacity or a business
relationship;
10 (b) one, a client, gives specific instructions to the other,
whose ordinary business includes dealing in securities,
to acquire shares on the client's behalf in the ordinary
course of that business;
(c) one has made, or proposes to make, to the other an
15 offer to which Division 2 of Part 11 applies, in
relation to shares held by the other;
(d) one has appointed the other, otherwise than for
valuable consideration given by the other or by an
associate of the other, to vote as a proxy or
20 representative at a meeting of members, or of a class
of members, of a body corporate.
PART 3--RELATED BODIES
22. Related bodies corporate
For the purposes of this Act, a body corporate is to be taken
25 to be related to--
(a) another body corporate that is its subsidiary; and
(b) another body corporate of which it is a subsidiary; and
(c) another body corporate if both it and that other body
corporate are subsidiaries of the same body corporate.
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SCHEDULE 3
REGISTRATION ETC. OF CHARGES
PART 1--PRELIMINARY
1. Interpretation
5 In this Part--
"co-operative'' includes a foreign co-operative registered
under Part 14;
"document of title'' means a document--
(a) used in the ordinary course of business as proof
10 of possession or control, or of the right to
possession or control, of property other than
land; or
(b) authorising or purporting to authorise, whether
by endorsement or delivery, the possessor of the
15 document to transfer or receive property other
than land--
and includes--
(c) a bill of lading; and
(d) a warehousekeeper's certificate; and
20 (e) a wharfinger's certificate; and
(f) a warrant or order for the delivery of goods; and
(g) a document that is, or evidences title to, a
marketable security;
"marketable security'' has the same meaning as in the
25 Corporations Law;
"present liability'', in relation to a charge, means a liability
that has arisen, being a liability the extent or amount
of which is fixed or capable of being ascertained,
whether or not the liability is immediately due to be
30 met;
"property'', in relation to a co-operative, means property
within Victoria held by the co-operative, whether or
not as trustee;
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"prospective liability'', in relation to a charge, means any
liability that may arise in the future, or any other
liability, but does not include a present liability;
"Register'' means the Register of Co-operative Charges
5 referred to in clause 18;
"registrable charge'' means a charge in relation to which,
by virtue of clause 4, the provisions of this Schedule
mentioned in clause 4(1) apply.
2. Application to charges referred to in clause 17
10 (1) A charge referred to in clause 17 is, until the charge is
registered, to be treated for the purposes of this Schedule as
if it were not a registrable charge but, when the charge is so
registered, it has the priority accorded to a registered charge
as from the time of registration.
15 (2) The registration of a charge referred to in clause 17 does not
prejudice any priority that would have been accorded to the
charge under any other law (whether or not a law of a place
in Australia) if the charge had not been registered.
3. Lodgment of documents
20 For the purposes of this Schedule, a notice or other
document is taken to be lodged when it is received at the
office of the Registrar by an officer authorised to receive it.
PART 2--REGISTRATION
Division 1--Charges
25 4. To which charges does Schedule apply?
(1) Subject to this Division, the provisions of this Schedule
relating to the giving of notice in relation to, the registration
of, and the priorities of, charges--
(a) apply in relation to the charges referred to in sub-
30 clause (2) (whether legal or equitable) on property of
a co-operative; and
(b) do not apply in relation to any other charges.
(2) Sub-clause (1) applies to the following charges--
(a) a floating charge on the whole or a part of the
35 property, business or undertaking of the co-operative;
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(b) a charge on uncalled share capital or uncalled share
premiums;
(c) a charge on a call, whether in respect of share capital
or share premiums, made but not paid;
5 (d) a charge on a personal chattel, including a personal
chattel that is unascertained or is to be acquired in the
future, but not including a ship registered in an official
register kept under a law of a place in Australia
relating to title to ships;
10 (e) a charge on goodwill, on a patent or licence under a
patent, on a trade mark or service mark or a licence to
use a trade mark or service mark, on a copyright or a
licence under a copyright or on a registered design or
a licence to use a registered design;
15 (f) a charge on a book debt;
(g) a charge on a marketable security, not being--
(i) a charge created in whole or in part by the
deposit of a document of title to the marketable
security; or
20 (ii) a mortgage under which the marketable security
is registered in the name of the chargee or a
person nominated by the chargee;
(h) a lien or charge on a crop, a lien or charge on wool or
a stock mortgage;
25 (i) a charge on a negotiable instrument other than a
marketable security.
5. Excluded charges
The provisions of this Schedule mentioned in clause 4(1)
do not apply in relation to--
30 (a) a charge, or a lien over property, arising by operation
of law; or
(b) a pledge of a personal chattel or of a marketable
security; or
(c) a charge created in relation to a negotiable instrument
35 or a document of title to goods, being a charge by way
of pledge, deposit, letter of hypothecation or trust
receipt; or
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(d) a transfer of goods in the ordinary course of the
practice of any profession or the carrying on of any
trade or business; or
(e) a dealing, in the ordinary course of the practice of any
5 profession or the carrying on of any trade or business,
in respect of goods outside Australia.
6. Personal chattels
The reference in clause 4(2)(d) to a charge on a personal
chattel is a reference to a charge on any article capable of
10 complete transfer by delivery, whether at the time of the
creation of the charge or at some later time, and includes a
reference to a charge on a fixture or a growing crop that is
charged separately from the land to which it is affixed or on
which it is growing, but does not include a reference to a
15 charge on--
(a) a document evidencing title to land; or
(b) a chattel interest in land; or
(c) a marketable security; or
(d) a document evidencing a thing in action; or
20 (e) stock or produce on a farm or land that by virtue of a
covenant or agreement ought not to be removed from
the farm or land where the stock or produce is at the
time of the creation of the charge.
7. Book debts
25 The reference in clause 4(2)(f) to a charge on a book
debt--
(a) is a reference to a charge on a debt due or to become
due to the co-operative at some future time on account
of or in connection with a profession, trade or
30 business carried on by the co-operative, whether
entered in a book or not; and
(b) includes a reference to a charge on a future debt of the
same nature although not incurred or owing at the time
of the creation of the charge--
35 but does not include a reference to a charge on a marketable
security, on a negotiable instrument or on a debt owing in
respect of a mortgage, charge or lease of land.
8. Crops or stock
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The reference in clause 4(2)(h) to a lien or charge on a
crop, a lien or charge on wool or a stock mortgage includes a
reference to a security (however described) that is registrable
under a prescribed law of a State or Territory.
5 9. Deposit of documents of title
For the purposes of this Division, a co-operative is to be
considered to have deposited a document of title to property
with another person (in this clause referred to as the
"chargee'') in a case where the document of title is not in the
10 possession of the co-operative if--
(a) the person who holds the document of title
acknowledges in writing that the person holds the
document of title on behalf of the chargee; or
(b) a government, an authority or a body corporate that
15 proposes to issue a document of title in relation to the
property agrees, in writing, to deliver the document of
title, when issued, to the chargee.
10. Charges on land or fixtures on land
(1) The provisions of this Schedule mentioned in clause 4(1) do
20 not apply in relation to a charge on land.
(2) The provisions of this Schedule mentioned in clause 4(1) do
not apply in relation to a charge on fixtures given by a
charge on the land to which they are affixed.
11. What if other property is also charged?
25 For the purposes of this Division, a charge is to be
considered to be a charge on property of a kind to which a
particular paragraph of clause 4(2) applies even though the
instrument of charge also charges other property of the co-
operative including other property that is of a kind to which
30 none of the paragraphs of that sub-clause applies.
12. Effect of failure to lodge or give notice or document
A charge on property of a co-operative is not invalid merely
because of the failure to lodge with the Registrar, or give to
the co-operative or another person, a notice or other
35 document that is required by this Part to be so lodged or
given.
Division 2--Notice of charge
13. Lodgment of notice of charge and copy of instrument
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(1) If a co-operative creates a charge, the co-operative must
ensure that there is lodged with the Registrar within 45 days
after the creation of the charge, a notice in the form
approved by the Registrar setting out the following
5 particulars--
(a) the name of the co-operative and the date of the
creation of the charge;
(b) whether the charge is a fixed charge, a floating charge
or both a fixed and floating charge;
10 (c) if the charge is a floating charge, whether there is any
provision in the resolution or instrument creating or
evidencing the charge that prohibits or restricts the
creation of subsequent charges;
(d) a short description of the liability (whether present or
15 prospective) secured by the charge;
(e) a short description of the property charged;
(f) whether the charge is created or evidenced by a
resolution, by an instrument or by a deposit or other
conduct;
20 (g) if the charge is constituted by the issue of a debenture
or debentures, the name of the trustee (if any) for
debenture holders;
(h) if the charge is not constituted by the issue of a
debenture or debentures or there is no trustee for
25 debenture holders, the name of the chargee;
(i) any other information that is prescribed.
(2) If, pursuant to a resolution or resolutions passed by the co-
operative, the co-operative issues a series of debentures
constituting a charge to the benefit of which all the holders
30 of debentures in the series are entitled in equal priority, and
the charge is evidenced only by the resolution or resolutions
and the debentures, the notice under sub-clause (1) must be
accompanied by--
(a) a copy of the resolution or of each of the resolutions
35 verified by a statement in writing to be a true copy;
and
(b) a copy of the first debenture issued in the series and a
statement in writing verifying the execution of that
first debenture.
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(3) If, in a case to which sub-clause (2) does not apply, the
charge created by the co-operative was created or evidenced
by an instrument or instruments, the notice under sub-clause
(1) must be accompanied by--
5 (a) the instrument or each of the instruments; or
(b) a copy of the instrument or of each of the instruments
verified by a statement in writing to be a true copy,
and a statement in writing verifying the execution of
the instrument or of each of the instruments.
10 14. Series of debentures
In a case to which clause 13(2) applies--
(a) the charge is, for the purposes of clause 13, to be
considered to be created when the first debenture in
the series of debentures is issued; and
15 (b) if, after the issue of the first debenture in the series,
the co-operative passes a further resolution
authorising the issue of debentures in the series, the
co-operative must ensure that a copy of that
resolution, verified by a statement in writing to be a
20 true copy of that resolution, is lodged within 45 days
after the passing of that resolution.
15. Operation of priority provisions in respect of issue of debentures
If a notice with respect to an instrument creating a charge
has been lodged under clause 13(1), being a charge in
25 respect of an issue of several debentures the holders of
which are entitled under the instrument in equal priority to
the benefit of the charge, clauses 46 to 49 have effect as if
any charges constituted by those debentures were registered
at the time when the charge to which the notice relates was
30 registered.
16. Discounts
(1) If a payment or discount has been made or allowed, either
directly or indirectly, by a co-operative to a person in
consideration of the person's subscribing or agreeing to
35 subscribe, whether absolutely or conditionally, for
debentures, or procuring or agreeing to procure
subscriptions, whether absolute or conditional, for
debentures, the notice required to be lodged under clause
13(1) must include particulars as to the amount or rate per
40 cent of the payment or discount.
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(2) If a co-operative issues debentures as security for a debt of
the co-operative, the co-operative is not thereby to be
regarded, for the purposes of sub-clause (1), as having
allowed a discount in respect of the debentures.
5 17. Acquisition of property subject to charge
(1) If a co-operative acquires property that is subject to a
charge, being a charge that would have been registrable
when it was created if it had been created by a co-operative,
the co-operative must, within 45 days after the acquisition of
10 the property--
(a) ensure that there is lodged with the Registrar a notice
in the form approved by the Registrar in relation to the
charge, setting out--
(i) the name of the co-operative; and
15 (ii) the date on which the property was so acquired;
and
(iii) any other particulars required by clause 13(1);
and
(b) give to the chargee notice that it has acquired the
20 property and the date on which it was so acquired.
(2) If the charge referred to in sub-clause (1) was created or
evidenced as mentioned in clause 13(2), the notice under
sub-clause (1)(a) must be accompanied by--
(a) a copy of the resolution or of each of the resolutions
25 referred to in clause 13(2) verified by a statement in
writing to be a true copy; and
(b) a copy of the first debenture issued in the series
referred to in clause 13(2) verified by a statement in
writing to be a true copy.
30 (3) If the charge referred to in sub-clause (1) was created or
evidenced by an instrument or instruments (otherwise than as
mentioned in clause 13(2)), the notice under sub-clause
(1)(a) must be accompanied by--
(a) the instrument or each of the instruments; or
35 (b) a copy of the instrument or of each of the instruments
verified by a statement in writing to be a true copy.
Division 3--Registration
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18. Register of Co-operative Charges
The Registrar must keep a register to be known as the
Register of Co-operative Charges.
19. Registration of documents relating to charge
5 (1) If a notice is lodged with the Registrar in accordance with
Division 2, the Registrar must as soon as practicable cause to
be entered in the Register the time and date when the notice
was lodged and the following particulars in relation to the
charge--
10 (a) if the charge is a charge created by the co-operative,
the date of its creation;
(b) if the charge was a charge existing on property
acquired by the co-operative, the date on which the
property was so acquired;
15 (c) a short description of the liability (whether present or
prospective) secured by the charge;
(d) a short description of the property charged;
(e) the name of the trustee for debenture holders or, if
there is no such trustee, the name of the chargee.
20 (2) Sub-clause (1) only applies if the notice contains the
required particulars and is accompanied by the required
documents.
(3) Sub-clause (1) applies whether the notice is lodged during or
after the period within the notice is required to be lodged.
25 (4) Subject to this Division, if particulars in respect of a charge
are entered in the Register in accordance with sub-clause (1),
the charge is to be considered to be registered, and to have
been registered from and including the time and date entered
in the Register under that sub-clause.
30 (5) The Registrar may enter in the Register in relation to a
charge, in addition to the particulars expressly required by
this Division to be entered, such other particulars as the
Registrar thinks fit.
20. Provisional registration if stamp duty not paid
35 (1) If--
(a) a notice in respect of a charge on property of a co-
operative is lodged under Division 2; and
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(b) the notice is not accompanied by a certificate to the
effect that all documents accompanying the notice
have been duly stamped as required by any applicable
law relating to stamp duty--
5 the Registrar must cause to be entered in the Register the
time and date when the notice was lodged and the particulars
referred to in clause 19(1)(a) to (e), but must cause the word
"provisional'' to be entered in the Register next to the entry
specifying that time and date.
10 (2) Sub-clause (1) applies whether the notice was lodged during
or after the period within which the notice was required to be
lodged.
(3) The Registrar must delete the word "provisional'' entered in
the Register under sub-clause (1) from an entry relating to a
15 charge if a certificate to the effect set out in sub-clause (1)(b)
has been produced to the Registrar--
(a) within a period of 28 days; or
(b) within such longer period as is prescribed after the
notice was lodged; or
20 (c) within such further period as the Registrar, if the
Registrar considers it to be appropriate in a particular
case, allows.
(4) The Registrar must delete from the Register all the
particulars that were entered in relation to a charge if--
25 (a) the word "provisional" is entered in the Register under
sub-clause (1) in relation to an entry relating to the
charge; and
(b) a certificate to the effect set out in sub-clause (1)(b) is
not produced within the period, or the further period,
30 referred to in sub-clause (3).
21. Provisional registration if required particulars not supplied
(1) If a defective notice in respect of a charge on property is
lodged with the Registrar under clause 19, the Registrar must
cause to be entered in the Register--
35 (a) the time and date when the document was lodged; and
(b) such of the particulars referred to in clause 19(1)(a) to
(e) as are ascertainable; and
(c) the word "provisional" next to the entry specifying the
time and date.
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(2) If a defective notice in respect of a charge is lodged under
clause 19, the Registrar must, by written notice to the person
who lodged the defective notice, direct the person to ensure
that there is lodged, on or before the day specified in the
5 notice, a notice in relation to the charge that complies with
the requirements of Division 2.
(3) Sub-clauses (1) and (2) apply whether the defective notice
was lodged during or after the period within which the notice
was required to be lodged.
10 (4) The giving by the Registrar of a direction to the person
under sub-clause (2) does not affect any liability that the co-
operative may have incurred or may incur by reason of a
contravention of Division 2.
(5) If the Registrar gives a direction to a person under sub-
15 clause (2) in relation to a charge and the direction is
complied with on or before the day specified in the notice
containing the direction, the Registrar must--
(a) delete from the Register the word "provisional'' that
was inserted pursuant to sub-clause (1); and
20 (b) cause to be entered in the Register in relation to the
charge any particulars referred to in clause 19(1) that
have not previously been entered.
(6) If the Registrar gives a direction to a person under sub-
clause (2) in relation to a charge and the direction is not
25 complied with on or before the day specified in the notice,
the Registrar must delete from the Register all the particulars
that were entered in relation to the charge.
(7) If the Registrar gives a direction to a person under sub-
clause (2) in relation to a charge and the direction is
30 complied with after the day specified in the notice, the
Registrar must cause to be entered in the Register in relation
to the charge--
(a) the time at which and day on which the direction was
complied with; and
35 (b) the particulars referred to in clause 19 (1)(a) to (e).
(8) In this clause "defective notice" means a document that--
(a) purports to be a notice in respect of a charge on
property of a co-operative for the purposes of
Division 2; and
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(b) contains the name of the co-operative concerned and
the particulars referred to in clause 13(1)(g) or (h), as
the case requires--
but does not contain some or all of the other particulars that
5 are required to be included in the notice or is otherwise
defective.
22. Effect of provisional registration
(1) Subject to this clause, if the word "provisional'' is entered in
the Register next to an entry specifying a time and day in
10 relation to a charge, the charge is to be considered not to
have been registered.
(2) If the word "provisional'' is deleted from the Register
pursuant to clause 20 or 21(5), the charge is to be considered
to be registered and to have been registered from and
15 including the time and day specified in the Register pursuant
to 20 or 21(1), as the case may be.
(3) If the particulars in relation to the charge are deleted from
the Register pursuant to clause 21(6) and those particulars
and a time and day are subsequently entered in the Register
20 in relation to the charge pursuant to clause 21(7) the charge
is to be considered to be registered from and including that
last-mentioned time and day.
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23. What if 2 or more charges relate to the same property?
(1) If, pursuant to clause 17, a co-operative lodges notices
relating to 2 or more charges on the same property acquired
by the co-operative (being charges that are not already
5 registered under this Division), the time and day that is to be
entered in the Register in relation to each of those charges
are the time and day when the first notice was lodged.
(2) If, in accordance with sub-clause (1), the time and day that
are entered in the Register are the same in relation to 2 or
10 more charges on property acquired by a co-operative, those
charges are to have, as between themselves, the respective
priorities that they would have had if they had not been
registered under this Division.
24. Registration of assignment or variation of charge
15 (1) If a notice is lodged under clause 36, the Registrar must as
soon as practicable cause to be entered in the Register the
time and day when the notice was so lodged and the
particulars set out in the notice.
(2) Sub-clause (1) applies whether the notice was lodged during
20 or after the period within which the notice was required to be
lodged.
25. Standard time for the purposes of this Division
(1) The Registrar may, by notice published in the Government
Gazette, declare a specified standard time to be the standard
25 time for the purposes of this Division.
(2) If a notice is in force under sub-clause (1), a reference in this
Division to entering the time when a particular event
happened is a reference to entering that time as expressed in
terms of the standard time specified in the notice.
Division 4--Certain charges void against liquidator or
30
administrator
26. Definitions
In this Division--
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"critical day'', in relation to a co-operative, means--
(a) if the co-operative is being wound up, the day
when the winding up began; or
(b) if the co-operative is under administration, the
5 relevant day in relation to the administration; or
(c) if the co-operative has executed a deed of
arrangement, the relevant day in relation to the
administration that ended when the deed was
executed.
10 "relevant day'', in relation to the administration of a co-
operative, means--
(a) if, when the administration began, a winding up
of the co-operative was in progress, the day on
which the winding up is taken because of
15 Division 1A of Part 5.6 of the Corporations
Law (as adopted and applying under this Act) to
have begun; or
(b) otherwise, the day on which the administration
began.
20 27. Certain charges void against liquidator or administrator
(1) Subject to this Division, if--
(a) an order is made, or a resolution is passed, for the
winding up of a co-operative; or
(b) the Registrar gives a certificate under section 315 for
25 the winding up of the co-operative; or
(c) an administrator of a co-operative is appointed under
Part 5.3A of the Corporations Law as adopted and
applying under this Act; or
(d) a co-operative executes a deed of arrangement--
30 a registrable charge on property of the co-operative is void
as a security on that property as against the liquidator, the
administrator of the co-operative, or the deed's
administrator, as the case may be.
(2) A charge is not void under sub-clause (1) if--
35 (a) a notice in respect of the charge was lodged under
clause 13 or 17, as the case requires--
(i) within the relevant period; or
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(ii) at least 6 months before the critical day; or
(b) the period within which a notice in respect of the
charge (other than a notice under clause 36) is
required to be lodged, being the period specified in
5 the relevant clause or that period as extended by the
Supreme Court under clause 29, has not ended at the
start of the critical day and the notice is lodged before
the end of that period; or
(c) in relation to a charge to which clause 17 applies, the
10 period of 45 days after the chargee becomes aware
that the property charged has been acquired by a co-
operative has not ended at the start of the critical day
and the notice is lodged before the end of that period.
(3) The reference in sub-clause (2)(a) to the relevant period
15 shall be construed as a reference to--
(a) in relation to a charge to which clause 13 applies, the
period of 45 days specified in that clause, or that
period as extended by the Supreme Court under clause
29; or
20 (b) in relation to a charge to which clause 17 applies, the
period of 45 days after the chargee becomes aware
that the property has been acquired by a co-operative.
28. Certain varied charges void against liquidator or administrator
(1) Subject to this Division, if, after there has been a variation in
25 the terms of a registrable charge on property of a co-
operative having the effect of increasing the amount of the
debt or increasing the liabilities (whether present or
prospective) secured by the charge--
(a) an order is made, or a resolution is passed, for the
30 winding up of the co-operative; or
(b) an administrator of a co-operative is appointed under
Part 5.3A of the Corporations Law (as adopted and
applying under this Act); or
(c) a co-operative executes a deed of arrangement--
35 the registrable charge is void as a security on that property to
the extent that it secures the amount of the increase in that
debt or liability.
(2) A charge is not void under sub-clause (1) if--
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(a) a notice in respect of the variation was lodged under
clause 36--
(i) within the period of 45 days specified in clause
36(2) or that period as extended by the Supreme
5 Court under clause 29; or
(ii) not later than 6 months before the critical day;
or
(b) the period of 45 days specified in clause 36(2), or that
period as extended by the Supreme Court under clause
10 29, has not ended at the start of the critical day and the
notice is lodged before the end of that period.
29. Supreme Court may extend required period
The Supreme Court, if it is satisfied that the failure to lodge
a notice in respect of a charge, or in respect of a variation in
15 the terms of a charge, as required by any provision of this
Schedule--
(a) was accidental or due to inadvertence or some other
sufficient cause; or
(b) is not of a nature to prejudice the position of creditors
20 or shareholders--
or that on other grounds it is just and equitable to grant
relief, may, on the application of the co-operative or any
person interested and on such terms and conditions as seem
to the Court just and expedient, by order, extend the period
25 for such further period as is specified in the order.
30. Certain later charges void
(1) Subject to sub-clause (3), if--
(a) a registrable charge (in this sub-clause referred to as
the "later charge'') is created before the end of 45 days
30 after the creation of an unregistered registrable charge
(in this sub-clause referred to as the "earlier charge'');
and
(b) the later charge relates to all or any of the property to
which the earlier charge related; and
35 (c) the later charge is given as a security for the same
liability as is secured by the earlier charge or any part
of that liability--
the later charge, to the extent to which it is a security for the
same liability or part thereof, and so far as it relates to the
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property comprised in the earlier charge, is void as a security
on that property as against a liquidator or administrator of
the co-operative, or an administrator of a deed of
arrangement executed by the co-operative.
5 (2) Sub-clause (1) applies even if a notice in respect of the later
charge was lodged under clause 13 within the period
mentioned in clause 27(2)(a).
(3) Sub-clause (1) does not apply if it is proved to the
satisfaction of the Supreme Court that the later charge was
10 given in good faith for the purpose of correcting some
material error in the earlier charge or under other proper
circumstances and not for the purposes of avoiding or
evading the provisions of this Division.
31. Effect of provisions on purchaser in good faith
15 (1) Nothing in clause 27(1) or(2) or 28 operates to affect the
title of a person to property purchased for value from a
chargee or from a receiver appointed by a chargee in the
exercise of powers conferred by the charge or implied by
law if that person purchased the property in good faith and
20 without notice of--
(a) the filing of an application for an order for the
winding up of the co-operative; or
(b) the passing of the necessary resolution for the
voluntary winding up of the co-operative; or
25 (c) an administrator of the co-operative being appointed
under Part 5.3A of the Corporations Law (as adopted
and applying under this Act); or
(d) the co-operative executing a deed of arrangement.
(2) The onus of proving that a person purchased property in
30 good faith and without notice of any of the matters referred
to in sub-clause (1)(a), (b), (c) and (d) is on the person
asserting that the property was so purchased.
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Division 5--Certain charges in favour of persons void
32. Definitions
In this Division--
"chargee'', in relation to a charge, means--
5 (a) in any case, the holder, or all or any of the
holders, of the charge; or
(b) in the case of a charge that is an agreement to
give or execute a charge in favour of a person
or persons, whether on demand or otherwise,
10 that person, or all or any of those persons;
"officer'', in relation to a co-operative, includes, in the case
of a foreign co-operative, a local agent of the foreign
co-operative;
"receiver'' includes a receiver and manager;
15 "relevant person'', in relation to a charge created by a co-
operative, means--
(a) a person who is at the time when the charge is
created, or who has been at any time during the
period of 6 months ending at that time, an
20 officer of the co-operative; or
(b) a person associated, in relation to the creation
of the charge, with a person of a kind referred
to in paragraph (a).
33. Charges in favour of certain persons void in certain cases
25 (1) If--
(a) a co-operative creates a charge on property of the co-
operative in favour of a person who is, or in favour of
persons at least one of whom is, a relevant person in
relation to the charge; and
30 (b) within 6 months after the creation of the charge, the
chargee purports to take a step in the enforcement of
the charge without the Supreme Court having, under
clause 34, given leave for the charge to be enforced--
the charge, and any powers purported to be conferred by an
35 instrument creating or evidencing the charge, are, and are to
be considered always to have been, void.
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(2) Without limiting the generality of sub-clause (1), a person
who--
(a) appoints a receiver of property of a co-operative under
powers conferred by an instrument creating or
5 evidencing a charge created by the co-operative; or
(b) whether directly or by an agent, enters into possession
or assumes control of property of a co-operative for
the purposes of enforcing a charge created by the co-
operative--
10 is to be taken, for the purposes of sub-clause (1), to take a
step in the enforcement of the charge.
34. Supreme Court may give leave for enforcement of charge
On application by the chargee under a charge, the Supreme
Court may give leave for the charge to be enforced, if the
15 Court is satisfied that--
(a) immediately after the creation of the charge, the co-
operative that created the charge was solvent; and
(b) in all the circumstances of the case, it is just and
equitable for the Court to do so.
20 35. Certain transactions excluded
(1) Nothing in clause 33 affects a debt, liability or obligation of
a co-operative that would, if that clause had not been
enacted, have been secured by a charge created by the co-
operative.
25 (2) Nothing in clause 33 operates to affect the title of a person to
property (other than the charge concerned or an interest in
the charge concerned) purchased for value from a chargee
under a charge, from an agent of a chargee under a charge,
or from a receiver appointed by a chargee under a charge in
30 the exercise of powers conferred by the charge or implied by
law, if that person purchased the property in good faith and
without notice that the charge was created in favour of a
person who is, or in favour of persons at least one of whom
is, as the case may be, a relevant person in relation to the
35 charge.
(3) The onus of proving that a person purchased property in
good faith and without notice that a charge was created as
mentioned in sub-clause (2) is on the person asserting that
the property was so purchased.
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Division 6--Assignment, variation or satisfaction of charges
36. Assignment and variation of charges
(1) If, after a registrable charge on property of a co-operative
has been created, a person other than the original chargee
5 becomes the holder of the charge, the person who becomes
the holder of the charge must, within 45 days after he, she or
it becomes the holder of the charge--
(a) lodge a notice with the Registrar stating that he, she or
it has become the holder of the charge; and
10 (b) give the co-operative a copy of the notice.
(2) If, after a registrable charge on property of a co-operative
has been created, there is a variation in the terms of the
charge having the effect of--
(a) increasing the amount of the debt or increasing the
15 liabilities (whether present or prospective) secured by
the charge; or
(b) prohibiting or restricting the creation of subsequent
charges on the property--
the co-operative must, within 45 days after the variation
20 occurs, ensure that there is lodged with the Registrar a notice
setting out particulars of the variation and accompanied by
the instrument (if any) effecting the variation or a certified
copy of that instrument.
(3) If a charge created by a co-operative secures a debt of an
25 unspecified amount or secures a debt of a specified amount
and further advances, a payment or advance made by the
chargee to the co-operative in accordance with the terms of
the charge is not to be taken, for the purposes of sub-clause
(2), to be a variation in the terms of the charge having the
30 effect of increasing the amount of the charge or the liabilities
(whether present or prospective) secured by the charge.
(4) A reference in this clause to the chargee in relation to a
charge is, if the charge is constituted by a debenture or
debentures and there is a trustee for debenture holders, to be
35 construed as a reference to the trustee for debenture holders.
(5) Nothing in clause 13 requires the lodgment of a notice under
that clause in relation to a charge merely because of the fact
that the terms of the charge are varied only in a manner
mentioned in this clause.
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37. Satisfaction of, and release of property from, charges
(1) If, with respect to a charge registered under this Part--
(a) the debt or other liability the payment or discharge of
which was secured by the charge has been paid or
5 discharged in whole or in part; or
(b) the property charged or part of that property is
released from the charge--
the person who was the holder of the charge at the time when
the debt or other liability was so paid or discharged or the
10 property or part of the property was released must, within 14
days after receipt of a request in writing made by the co-
operative on whose property the charge exists, give to the
co-operative a memorandum in the form approved by the
Registrar acknowledging that the debt or other liability has
15 been paid or discharged in whole or in part or that the
property or that part of it is no longer subject to the charge,
as the case may be.
(2) The co-operative may lodge the memorandum with the
Registrar and, on the memorandum being lodged, the
20 Registrar must enter in the Register particulars of the matters
stated in the memorandum.
(3) The reference in sub-clause (1) to the person who was the
holder of a charge at the time when the debt or other liability
was so paid or discharged or the property or part of the
25 property was released is, if the charge was constituted by a
debenture or debentures and there was a trustee for
debenture holders, to be construed as a reference to the
person who was, at that time, the trustee of debenture
holders.
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Division 7--General
38. Lodgment of notices
(1) If a notice in respect of a charge on property of a co-
operative is required to be lodged under clause 13, 17 or
5 36(2), the notice may be lodged by the co-operative or by
any interested person.
(2) If a document required by this Part other than clause 36(1) to
be lodged with the Registrar is lodged by a person other than
the co-operative concerned, that person--
10 (a) must, within 7 days after the lodgment of the
document, give to the co-operative a copy of the
document; and
(b) is entitled to recover from the co-operative the amount
of any fees properly paid by the person on lodgment
15 of the document.
39. Lodgment offences
(1) If clause 13, 17 or 36(2) is contravened in relation to a
registrable charge on property of a co-operative, the co-
operative and any officer of the co-operative who is
20 knowingly concerned in or a party to the contravention is
guilty of an offence and liable to a penalty not exceeding 10
penalty units.
(2) If a person who becomes the holder of a registrable charge
fails to comply with clause 36(1), the person and, if the
25 person is a body corporate, any officer of the body corporate
who is in default, each contravene this subclause.
40. Co-operative to keep documents relating to charges
A co-operative must, at the place where the register referred
to in clause 41 is kept, keep a copy of--
30 (a) every document relating to a charge on property of the
co-operative that is lodged with the Registrar under
this Part; and
(b) every document given to the co-operative under this
Part.
35 Penalty: 10 penalty units.
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41. Co-operative to keep register
(1) A co-operative must keep a register.
(2) On the creation of a charge (whether registrable or not) on
property of the co-operative, or on the acquisition of
5 property subject to a charge (whether registrable or not), the
co-operative must as soon as practicable enter in the register
particulars of the charge, giving in each case--
(a) if the charge is a charge created by the co-operative,
the date of its creation or, if the charge was a charge
10 existing on property acquired by the co-operative, the
date on which the property was so acquired; and
(b) a short description of the liability (whether present or
prospective) secured by the charge; and
(c) a short description of the property charged; and
15 (d) the name of the trustee for debenture holders or, if
there is no such trustee, the name of the chargee; and
(e) the name of the person whom the co-operative
believes to be the holder of the charge.
(3) A register kept by a co-operative pursuant to sub-clause (1)
20 must be open for inspection--
(a) by any creditor or member of the co-operative,
without charge; and
(b) by any other person, on payment for each inspection
of such amount, not exceeding the prescribed amount,
25 as the co-operative requires or, where the co-operative
does not require the payment of an amount, without
charge.
(4) A person may request a co-operative to furnish the person
with a copy of the register or any part of the register.
30 (5) If a person makes a request under sub-section (4), the co-
operative must send the copy to that person--
(a) if the co-operative requires payment of an amount not
exceeding the prescribed amount, within 21 days after
payment of the amount is received by the co-operative
35 or within such longer period as the Registrar
approves; or
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(b) in a case to which paragraph (a) does not apply, within
21 days after the request is made or within such longer
period as the Registrar approves.
(6) If default is made in complying with any provision of this
5 clause, the co-operative is guilty of an offence and liable to a
penalty not exceeding 10 penalty units.
42. Certificates
(1) If particulars of a charge are entered in the Register in
accordance with this Part, the Registrar must, on request by
10 any person, issue to that person a certificate--
(a) setting out those particulars; and
(b) stating the time and day when a notice in respect of
the charge containing those particulars was lodged
with the Registrar; and
15 (c) if the word "provisional'' appears in the Register next
to the reference to that time and day, stating that fact.
(2) A certificate issued under sub-clause (1) is evidence of the
matters stated in the certificate.
(3) If particulars of a charge are entered in the Register in
20 accordance with this Part, and the word "provisional'' does
not appear in the Register next to the reference to the time
and day when a notice in respect of the charge was lodged,
the Registrar must, on request by any person, issue to that
person a certificate stating that particulars of the charge are
25 entered in the Register in accordance with this Part.
(4) A certificate issued under sub-clause (3) is conclusive
evidence that the requirements of this Part as to registration
(other than the requirements relating to the period after the
creation of the charge within which notice in respect of the
30 charge is required to be lodged) have been complied with.
43. Power of Supreme Court to rectify Register
If the Supreme Court is satisfied--
(a) that a particular with respect to a registrable charge on
property of a co-operative has been omitted from, or
35 mis-stated in, the Register or a memorandum referred
to in clause 37; and
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(b) that the omission or misstatement--
(i) was accidental or due to inadvertence or to
some other sufficient cause; or
(ii) is not of a nature to prejudice the position of
5 creditors or shareholders--
or that on other grounds it is just and equitable to
grant relief--
the Court may, on the application of the co-operative or any
person interested and on such terms and conditions as seem
10 to the Court just and expedient, order that the omission or
mis-statement be rectified.
44. Power to exempt from compliance with certain requirements of
Part
(1) The Registrar may, by instrument in writing, exempt a
15 person, as specified in the instrument and subject to the
conditions (if any) that are specified in the instrument, from
compliance with such of the requirements of clause 13, 17 or
36 relating to--
(a) the particulars to be contained in a notice under the
20 relevant clause; or
(b) the documents (other than the notice) to be lodged
under the relevant clause; or
(c) the verification of any document required to be lodged
under the relevant clause--
25 as are specified in the instrument.
(2) A person who is exempted by the Registrar, subject to a
condition, from compliance with a requirement of clause 13,
17 or 36 must not contravene the condition.
(3) If a person has contravened a condition to which an
30 exemption under this clause is subject, the Supreme Court
may, on the application of the Registrar, order the person to
comply with the condition.
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PART 3--ORDER OF PRIORITY
Division 1--General
45. Definitions
(1) In this Part--
5 "priority time'', in relation to a registered charge, means--
(a) except as provided by paragraph (b) or (c), the
time and date appearing in the Register in
relation to the charge, being a time and day
entered in the Register pursuant to Division 3 of
10 Part 2; and
(b) if a notice has been lodged under clause 17 in
relation to a charge on property, being a charge
that, at the time when the notice was lodged,
was already registered under Part 2, the earlier
15 or earliest time and day appearing in the
Register in relation to the charge, being a time
and day entered in the Register pursuant to
clause 17; and
(c) to the extent that the charge has effect as varied
20 by a variation notice of which was required to
be lodged under clause 36(2), the time and day
entered in the Register in relation to the charge
pursuant to clause 24;
"prior registered charge'', in relation to another registered
25 charge, means a charge the priority time of which is
earlier than the priority time of the other charge;
"subsequent registered charge'', in relation to another
registered charge, means a charge the priority time of
which is later than the priority time of the other
30 registered charge;
"registered charge'' means a charge that is registered under
Part 2;
"unregistered charge'' means a charge that is not registered
under Part 2 but does not include a charge that is not a
35 registrable charge.
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(2) A reference in this Part to a person having notice of a charge
includes a reference to a person having constructive notice
of the charge.
(3) If, by virtue of the definition of "priority time'' in sub-clause
5 (1), a registered charge has 2 or more priority times each of
which relates to a particular liability secured by the charge,
each of those liabilities is, for the purposes of this Part, to be
considered to be secured by a separate registered charge the
priority time of which is the priority time of the first-
10 mentioned registered charge that relates to the liability
concerned.
46. Priorities of charges
(1) Subject to this clause, Division 2 has effect with respect to
the priorities, in relation to each other, of registrable charges
15 on the property of a co-operative.
(2) The application, in relation to particular registrable charges,
of the order of priorities of charges set out in Division 2, is
subject to--
(a) any consent (express or implied) that varies the
20 priorities in relation to each other of those charges,
being a consent given by the holder of one of those
charges, being a charge that would otherwise be
entitled to priority over the other charge; and
(b) any agreement between those chargees that affects the
25 priorities in relation to each other of the charges in
relation to which those persons are the chargees.
(3) The holder of a registered charge, being a floating charge, on
property of a co-operative is to be considered, for the
purposes of sub-clause (2), to have consented to that charge
30 being postponed to a subsequent registered charge, being a
fixed charge that is created before the floating charge
becomes fixed, on any of that property unless--
(a) the creation of the subsequent registered charge
contravened a provision of the instrument or
35 resolution creating or evidencing the floating charge;
and
(b) a notice in respect of the floating charge indicating the
existence of the provision referred to in paragraph (a)
was lodged with the Registrar under clause 13, 17 or
40 36 before the creation of the subsequent registered
charge.
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(4) If a charge relates to property of a kind or kinds to which a
particular paragraph or paragraphs of clause 4(1) applies or
apply and also relates to other property, Division 2 applies
so as to affect the priority of the charge only in so far as it
5 relates to the first-mentioned property and do not affect the
priority of the charge in so far as it relates to the other
property.
Division 2--Priority rules
47. General priority rules in relation to registered charges
10 (1) A registered charge on property of a co-operative has
priority over--
(a) a subsequent registered charge on the property, unless
the subsequent registered charge was created before
the creation of the prior registered charge and the
15 chargee in relation to the subsequent registered charge
proves that the chargee in relation to the prior
registered charge had notice of the subsequent
registered charge at the time when the prior registered
charge was created; and
20 (b) an unregistered charge on the property created before
the creation of the registered charge, unless the
chargee in relation to the unregistered charge proves
that the chargee in relation to the registered charge
had notice of the unregistered charge at the time when
25 the registered charge was created; and
(c) an unregistered charge on the property created after
the creation of the registered charge.
(2) A registered charge on property of a co-operative is
postponed to--
30 (a) a subsequent registered charge on the property, if the
subsequent registered charge was created before the
creation of the prior registered charge and the chargee
in relation to the subsequent registered charge proves
that the chargee in relation to the prior registered
35 charge had notice of the subsequent registered charge
at the time when the prior registered charge was
created; and
(b) an unregistered charge on the property created before
the creation of the registered charge, where the
40 chargee in relation to the unregistered charge proves
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that the chargee in relation to the registered charge
had notice of the unregistered charge at the time when
the registered charge was created.
48. General priority rule in relation to unregistered charges
5 An unregistered charge on property of a co-operative has
priority over--
(a) a registered charge on the property that was created
after the creation of the unregistered charge and does
not have priority over the unregistered charge under
10 clause 47(1); and
(b) another unregistered charge on the property created
after the first-mentioned unregistered charge.
49. Special priority rules
(1) Except as provided by this clause, any priority accorded by
15 this Part to a charge over another charge does not extend to
any liability that, at the priority time in relation to the first-
mentioned charge, is not a present liability.
(2) If a registered charge on property of a co-operative
secures--
20 (a) a present liability and a prospective liability of an
unspecified amount; or
(b) a prospective liability of an unspecified amount--
any priority accorded by this Part to the charge over another
charge of which the chargee in relation to the first-mentioned
25 charge does not have actual knowledge extends to the
prospective liability, whether the prospective liability
became a present liability before or after the registration of
the first-mentioned charge.
(3) If a registered charge on property of a co-operative
30 secures--
(a) a present liability and a prospective liability up to a
specified maximum amount; or
(b) a prospective liability up to a specified maximum
amount--
35 and the notice lodged under clause 13 or 17 in relation to the
charge sets out the nature of the prospective liability and the
amount so specified, then any priority accorded by this Part
to the charge over another charge extends to any prospective
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liability secured by the first-mentioned charge to the extent
of the maximum amount so specified.
(4) Sub-clause (3) applies whether the prospective liability
became a present liability before or after the registration of
5 the first-mentioned charge and despite the fact that the
chargee in relation to the first-mentioned charge had actual
knowledge of the other charge at the time when the
prospective liability became a present liability.
(5) Sub-clause (6) applies if--
10 (a) a registered charge on property of a co-operative
secures--
(i) a present liability and a prospective liability up
to a specified maximum amount; or
(ii) a prospective liability up to a specified
15 maximum amount--
but the notice lodged under clause 13 or 17 in relation
to the charge does not set out the nature of the
prospective liability or the maximum amount so
specified; or
20 (b) a registered charge on property of a co-operative
secures a prospective liability of an unspecified
amount.
(6) In relation to a charge referred to in sub-clause (5)--
(a) any priority accorded by this Part to the charge over
25 another charge of which the chargee in relation to the
first-mentioned charge has actual knowledge extends
to any prospective liability secured by the first-
mentioned charge that had become a present liability
at the time when the chargee in relation to the first-
30 mentioned charge first obtained actual knowledge of
the other charge;
(b) any priority accorded by this Part to the charge over
another charge of which the chargee in relation to the
first-mentioned charge has actual knowledge extends
35 to any prospective liability secured by the first-
mentioned charge that became a present liability, as
the result of the making of an advance, after the time
when the chargee in relation to the first-mentioned
charge first obtained actual knowledge of the other
40 charge if, at that time, the terms of the first-mentioned
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charge required the chargee in relation to that charge
to make the advance after that time.
(7) Sub-clause (6)(b) extends to the prospective liability whether
the advance was made before or after the registration of the
5 first-mentioned charge and despite the fact that the chargee
in relation to the first-mentioned charge had actual
knowledge of the other charge at the time when the advance
was made.
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SCHEDULE 4
RECEIVERS, AND OTHER CONTROLLERS, OF PROPERTY
OF CO-OPERATIVES
1. Interpretation
5 In this Schedule--
"administrator'', in relation to a deed of arrangement,
means an administrator of the deed appointed under
Part 5.3A of the Corporations Law, as adopted and
applying under this Act;
10 "control day'', in relation to a controller of property of a
co-operative, means--
(a) unless paragraph (b) applies--
(i) in the case of a receiver, or receiver and
manager, of that property, the day when
15 the receiver, or receiver and manager,
was appointed; or
(ii) in the case of any other person who is in
possession, or has control, of that
property for the purpose of enforcing a
20 charge, the day when the person entered
into possession, or took control, of
property of the co-operative for the
purpose of enforcing that charge; or
(b) if the controller became a controller of property
25 of the co-operative--
(i) to act with an existing controller of that
property; or
(ii) in place of a controller of that property
who has died or ceased to be a controller
30 of that property--
the day that is, because of any other application
or applications of this definition, the control day
in relation to the controller referred to in sub-
paragraph (i) or (ii);
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"controller'', in relation to property of a co-operative,
means--
(a) a receiver, or receiver and manager, of that
property; or
5 (b) anyone else who (whether or not as agent for
the co-operative) is in possession, or has
control, of that property for the purpose of
enforcing a charge;
"co-operative'' includes a foreign co-operative registered
10 under Part 14;
"daily newspaper'' means a newspaper that is ordinarily
published on each day that is a business day in the
place where the newspaper is published, whether or
not the newspaper is ordinarily published on other
15 days;
"managing controller'', in relation to property of a co-
operative, means--
(a) a receiver and manager of that property; or
(b) any other controller of that property who has
20 functions or powers in connection with
managing the co-operative;
"national newspaper'' means a daily newspaper that
circulates generally in each State, the Capital Territory
and the Northern Territory;
25 "officer'', in relation to a co-operative that is a foreign co-
operative, includes a local agent of the foreign co-
operative;
"property'', in relation to a co-operative, means property--
(a) in the case of a co-operative that is not a foreign
30 co-operative, within or outside Australia; or
(b) in the case of a co-operative that is a foreign co-
operative, within Australia or an external
Territory;
"receiver'', in relation to property of a co-operative,
35 includes a receiver and manager.
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2. Application of Schedule
Except in so far as the contrary intention appears, this
Schedule applies in relation to a receiver of property of a co-
operative who is appointed after the commencement of this
5 Schedule, even if the appointment arose out of a transaction
entered into, or an act or thing done, before that
commencement.
3. Persons not to act as receivers
(1) A person is not qualified to be appointed, and must not act,
10 as receiver of property of a co-operative if the person--
(a) is a mortgagee of property of the co-operative; or
(b) is an auditor or an officer of the co-operative; or
(c) is an officer of a body corporate that is a mortgagee of
property of the co-operative; or
15 (d) is not a registered liquidator under the Corporations
Law; or
(e) is an officer of a body corporate related to the co-
operative; or
(f) unless the Registrar directs in writing that this
20 paragraph does not apply in relation to the person in
relation to the co-operative, has at any time within the
last 12 months been an officer or promoter of the co-
operative or of a related body corporate.
(2) In sub-clause (1)--
25 "officer'', in relation to a body corporate, does not include a
receiver, appointed under an instrument whether
before or after the commencement of this clause, of
property of the body.
(3) Sub-clause (1)(d) does not apply in relation to a body
30 corporate authorised by or under a law of the
Commonwealth, of a State or of a Territory to act as receiver
of property of the co-operative concerned.
(4) Nothing in this clause prevents a person from acting as
receiver of property of a co-operative under an appointment
35 validly made before the commencement of this clause.
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4. Supreme Court may declare whether controller is validly acting
(1) If there is doubt, on a specific ground, about--
(a) whether a purported appointment of a person, after the
commencement of this clause, as receiver of property
5 of a co-operative is valid; or
(b) whether a person who has entered into possession, or
assumed control, of property of a co-operative after
the commencement of this clause did so validly under
the terms of a charge on that property--
10 the person, the co-operative or any of the co-operative's
creditors may apply to the Supreme Court for an order under
sub-clause (2).
(2) On an application, the Supreme Court may make an order
declaring whether or not--
15 (a) the purported appointment was valid; or
(b) the person entered into possession, or assumed
control, validly under the terms of the charge--
as the case may be, on the ground specified in the
application or on some other ground.
20 5. Liability of controller
(1) A receiver, or any other authorised person, who, whether as
agent for the co-operative concerned or not, enters into
possession or assumes control of any property of a co-
operative for the purpose of enforcing any charge is, despite
25 any agreement to the contrary, but without prejudice to the
person's rights against the co-operative or any other person,
liable for debts incurred by the person in the course of the
receivership, possession or control for services rendered,
goods purchased or property hired, leased, used or occupied.
30 (2) Sub-clause (1) does not constitute the person entitled to the
charge a mortgagee in possession.
(3) If--
(a) a person (in this sub-clause called the "controller'')
enters into possession or assumes control of property
35 of a co-operative; and
(b) the controller purports to have been properly
appointed as a receiver in respect of that property
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under a power contained in an instrument, but has not
been properly so appointed; and
(c) civil proceedings in a federal court or a court of a
State or Territory arise out of an act alleged to have
5 been done by the controller--
the court may, if it is satisfied that the controller believed on
reasonable grounds that the controller had been properly so
appointed, order that--
(d) the controller be relieved in whole or in part of a
10 liability that the controller has incurred but would not
have incurred if the controller had been properly so
appointed; and
(e) a person who purported to appoint the controller as
receiver be liable in respect of an act, matter or thing
15 in so far as the controller has been relieved under
paragraph (d) of liability in respect of that act, matter
or thing.
6. Liability of controller under pre-existing agreement about
property used by co-operative
20 (1) This clause applies if--
(a) under an agreement made before the control day in
relation to a controller of property of a co-operative,
the co-operative continues after that day to use or
occupy, or to be in possession of, property ("the third
25 party property'') of which someone else is the owner
or lessor; and
(b) the controller is controller of the third party property.
(2) Subject to sub-clauses (4) and (7), the controller is liable for
so much of the rent or other amounts payable by the co-
30 operative under the agreement as is attributable to a
period--
(a) that begins more than 7 days after the control day; and
(b) throughout which--
(i) the co-operative continues to use or occupy, or
35 to be in possession of, the third party property;
and
(ii) the controller is controller of the third party
property.
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(3) Within 7 days after the control day, the controller may give
to the owner or lessor a notice that specifies the third party
property and states that the controller does not propose to
exercise rights in relation to that property as controller of the
5 property, whether on behalf of the co-operative or anyone
else.
(4) Despite sub-clause (2), the controller is not liable for so
much of the rent or other amounts payable by the co-
operative under the agreement as is attributable to a period
10 during which a notice under sub-clause (3) is in force, but
such a notice does not affect a liability of the co-operative.
(5) A notice under sub-clause (3) ceases to have effect if--
(a) the controller revokes it by writing given to the owner
or lessor; or
15 (b) the controller exercises, or purports to exercise, a right
in relation to the third party property as controller of
the property, whether on behalf of the co-operative or
anyone else.
(6) For the purposes of sub-clause (5), the controller does not
20 exercise, or purport to exercise, a right referred to in sub-
clause (5)(b) merely because the controller continues to be
in possession, or to have control, of the third party property,
unless the controller--
(a) also uses the property; or
25 (b) asserts a right, as against the owner or lessor, so to
continue.
(7) Sub-clause (2) does not apply in so far as the Supreme
Court, by order, excuses the controller from liability, but an
order does not affect a liability of the co-operative.
30 (8) The controller is not taken because of sub-clause (2)--
(a) to have adopted the agreement; or
(b) to be liable under the agreement otherwise than as
mentioned in sub-clause (2).
7. Powers of receiver
35 (1) Subject to this clause, a receiver of property of a co-
operative has power to do, in Australia and elsewhere, all
things necessary or convenient to be done for or in
connection with, or as incidental to, the attainment of the
objectives for which the receiver was appointed.
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(2) Without limiting the generality of sub-clause (1), but subject
to any provision of the court order by which, or the
instrument under which, the receiver was appointed, being a
provision that limits the receiver's powers in any way, a
5 receiver of property of a co-operative has, in addition to any
powers conferred by that order or instrument, as the case
may be, or by any other law, power, for the purpose of
attaining the objectives for which the receiver was
appointed--
10 (a) to enter into possession and take control of property of
the co-operative in accordance with the terms of that
order or instrument; and
(b) to lease, let on hire or dispose of property of the co-
operative; and
15 (c) to grant options over property of the co-operative on
such conditions as the receiver thinks fit; and
(d) to borrow money on the security of property of the co-
operative; and
(e) to insure property of the co-operative; and
20 (f) to repair, renew or enlarge property of the co-
operative; and
(g) to convert property of the co-operative into money;
and
(h) to carry on any business of the co-operative; and
25 (i) to take on lease or on hire, or to acquire, any property
necessary or convenient in connection with the
carrying on of a business of the co-operative; and
(j) to execute any document, bring or defend any
proceedings or do any other act or thing in the name
30 of and on behalf of the co-operative; and
(k) to draw, accept, make and endorse a bill of exchange
or promissory note; and
(l) to use a seal of the co-operative; and
(m) to engage or discharge employees on behalf of the co-
35 operative; and
(n) to appoint a solicitor, accountant or other
professionally qualified person to assist the receiver;
and
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(o) to appoint an agent to do any business that the
receiver is unable to do, or that it is unreasonable to
expect the receiver to do, in person; and
(p) if a debt or liability is owed to the co-operative, to
5 prove the debt or liability in a bankruptcy, insolvency
or winding up and, in that connection, to receive
dividends and to assent to a proposal for a
composition or a scheme of arrangement; and
(q) if the receiver was appointed under an instrument that
10 created a charge on uncalled capital or uncalled
premiums of the co-operative--
(i) in the name of the co-operative, to make a call
in respect of money unpaid on shares in the co-
operative (whether on account of the nominal
15 value of the shares or by way of premium); or
(ii) on the giving of a proper indemnity to a
liquidator of the co-operative, in the name of
the liquidator, to make a call in respect of
money unpaid on account of the nominal value
20 of shares in the co-operative; and
(r) to enforce payment of any call that is due and unpaid,
whether the calls were made by the receiver or
otherwise; and
(s) to make or defend an application for the winding up of
25 the co-operative; and
(t) to refer to arbitration any question affecting the co-
operative.
(3) The conferring by this clause on a receiver of powers in
relation to property of a co-operative does not affect any
30 rights in relation to that property of any other person other
than the co-operative.
(4) In this clause, a reference, in relation to a receiver, to
property of a co-operative is, unless the contrary intention
appears, a reference to the property of the co-operative in
35 relation to which the receiver was appointed.
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8. Controller's duty of care in exercising power of sale
(1) In exercising a power of sale in respect of property of a co-
operative, a controller must take all reasonable care to sell
the property for--
5 (a) if, when it is sold, it has a market value, not less than
that market value; or
(b) otherwise, the best price that is reasonably obtainable,
having regard to the circumstances existing when the
property is sold.
10 (2) Nothing in sub-clause (1) limits the generality of anything in
Division 2 of Part 9.
9. Supreme Court may authorise managing controller to dispose of
property despite prior charge
(1) On the application of a managing controller of property of a
15 co-operative, the Supreme Court may by order authorise the
controller to sell, or to dispose of in some other specified
way, specified property of the co-operative, even though it is
subject to a charge (in this clause called the "prior charge'')
that has priority over a charge (in this clause called the
20 "controller's charge'') on that property that the controller is
enforcing.
(2) The Supreme Court may make an order if satisfied that--
(a) apart from the existence of the prior charge, the
controller would have power to sell, or to so dispose
25 of, the property; and
(b) the controller has taken all reasonable steps to obtain
the consent of the holder of the prior charge to the sale
or disposal, but has not obtained that consent; and
(c) sale or disposal of the property under the order is in
30 the best interests of the co-operative's creditors and of
the co-operative; and
(d) sale or disposal of the property under the order will
not unreasonably prejudice the rights or interests of
the holder of the prior charge.
35 (3) The Supreme Court may have regard to the need to protect
adequately the rights and interests of the holder of the prior
charge.
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(4) If the property would be sold or disposed of together with
other property that is subject to the controller's charge, the
Supreme Court may have regard to--
(a) the amount (if any) by which it is reasonable to expect
5 that the net proceeds of selling or disposing of that
other property otherwise than together with the first-
mentioned property would be less than so much of the
net proceeds of selling or disposing of all the property
together as would be attributable to that other
10 property; and
(b) the amount (if any) by which it is reasonable to expect
that the net proceeds of selling or disposing of the
first-mentioned property otherwise than together with
the other property would be greater than so much of
15 the net proceeds of selling or disposing of all the
property together as would be attributable to the first-
mentioned property.
(5) Nothing in sub-clause (3) or (4) limits the matters to which
the Supreme Court may have regard for the purposes of sub-
20 clause (2).
(6) An order may be made subject to conditions, for example
(but without limitation)--
(a) a condition that--
(i) the net proceeds of the sale or disposal; and
25 (ii) the net proceeds of the sale or disposal of such
other property (if any) as is specified in the
condition and is subject to the controller's
charge--
or a specified part of those net proceeds, be applied in
30 payment of specified amounts secured by the prior
charge; or
(b) a condition that the controller apply a specified
amount in payment of specified amounts secured by
the prior charge.
35 10. Receiver's power to carry on co-operative's business during
winding up
(1) A receiver of property of a co-operative that is being wound
up may--
(a) with the written approval of the co-operative's
40 liquidator or with the approval of the Supreme Court,
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carry on the co-operative's business either generally or
as otherwise specified in the approval; and
(b) do whatever is necessarily incidental to carrying on
that business under paragraph (a).
5 (2) Sub-clause (1) does not--
(a) affect a power that the receiver has otherwise than
under that sub-clause; or
(b) empower the receiver to do an act that he or she would
not have power to do if the co-operative were not
10 being wound up.
(3) A receiver of property of a co-operative who carries on the
co-operative's business under sub-clause (1) does so--
(a) as agent for the co-operative; and
(b) in his or her capacity as receiver of property of the co-
15 operative.
(4) The consequences of sub-clause (3) include, but are not
limited to, the following--
(a) for the purposes of clause 5(1), a debt that the receiver
incurs in carrying on the business as mentioned in sub-
20 clause (3) of this clause is incurred in the course of the
receivership;
(b) a debt or liability that the receiver incurs in so
carrying on the business is not a cost, charge or
expense of the winding up.
25 11. Controller's duties in relation to bank accounts and accounting
records
(1) A controller of property of a co-operative must--
(a) open and maintain an account, with an Australian
bank, bearing--
30 (i) the controller's own name; and
(ii) in the case of a receiver of the property, the title
"receiver''; and
(iii) otherwise, the title "controller''; and
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(iv) the co-operative's name--
or 2 or more such accounts; and
(b) within 3 business days after money of the co-operative
comes under the control of the controller, pay that
5 money into such an account that the controller
maintains; and
(c) ensure that no such account that the controller
maintains contains money other than money of the co-
operative that comes under the control of the
10 controller; and
(d) keep such accounting records as correctly record and
explain all transactions that the controller enters into
as the controller.
(2) Any director, creditor or member of a co-operative may,
15 unless the Supreme Court otherwise orders, personally or by
an agent, inspect records kept by a controller of property of
the co-operative for the purposes of sub-clause (1)(d).
12. Managing controller to report within 2 months about co-
operative's affairs
20 (1) A managing controller of property of a co-operative must
prepare a report about the co-operative's affairs that is in the
form approved by the Registrar and is made up to a day not
later than 28 days before the day when it is prepared.
(2) The managing controller must prepare the report and lodge it
25 with the Registrar within 2 months after the control day.
(3) As soon as practicable, and in any event within 14 days,
after lodging the report with the Registrar, the managing
controller must cause to be published in a national
newspaper, or in each State and Territory in a daily
30 newspaper that circulates generally in that State or Territory,
a notice stating--
(a) that the report has been prepared; and
(b) that a person can, on paying the prescribed fee,
inspect the report at specified offices of the Registrar.
35 (4) If, in the managing controller's opinion, it would seriously
prejudice--
(a) the co-operative's interests; or
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(b) the achievement of the objectives for which the
controller was appointed, or entered into possession or
assumed control of property of the co-operative, as the
case requires--
5 if particular information that the controller would otherwise
include in the report were made available to the public, the
controller need not include the information in the report.
(5) If the managing controller omits information from the report
as permitted by sub-clause (4), the controller must include
10 instead a notice--
(a) stating that certain information has been omitted from
the report; and
(b) summarising what the information is about, but
without disclosing the information itself.
15 13. Reports by receiver
(1) If it appears to the receiver of property of a co-operative
that--
(a) a past or present officer, or a member, of the co-
operative may have been guilty of an offence under
20 any law of the Commonwealth or of a State or
Territory in relation to the co-operative; or
(b) a person who has taken part in the formation,
promotion, administration, management or winding up
of the co-operative--
25 (i) may have misapplied or retained, or may have
become liable or accountable for, any money or
property (whether the property is within or
outside Australia) of the co-operative; or
(ii) may have been guilty of any negligence,
30 default, breach of duty or breach of trust in
relation to the co-operative--
the receiver must--
(c) lodge with the Registrar as soon as practicable a
report about the matter; and
35 (d) give to the Registrar such information, and such
access to and facilities for inspecting and taking
copies of any documents, as the Registrar requires.
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(2) The receiver may also lodge further reports specifying any
other matter that, in the receiver's opinion, it is desirable to
bring to the notice of the Registrar.
(3) If it appears to the Supreme Court--
5 (a) that a past or present officer, or a member, of a co-
operative in respect of property of which a receiver
has been appointed has been guilty of an offence
under a law referred to in sub-clause (1)(a) in relation
to the co-operative; or
10 (b) that a person who has taken part in the formation,
promotion, administration, management or winding up
of a co-operative in respect of property of which a
receiver has been appointed has engaged in conduct
referred to in sub-clause (1)(b) in relation to the co-
15 operative--
and that the receiver has not lodged a report with the
Registrar about the matter, the Court may, on the application
of a person interested in the appointment of the receiver or
of its own motion, direct the receiver to lodge such a report.
20 14. Supervision of controller
(1) If--
(a) it appears to the Supreme Court or to the Registrar
that a controller of property of a co-operative has not
faithfully performed, or is not faithfully performing,
25 the controller's functions or has not observed, or is not
observing, a requirement of--
(i) in the case of a receiver, the order by which, or
the instrument under which, the receiver was
appointed; or
30 (ii) otherwise, an instrument under which the
controller entered into possession, or took
control, of that property; or
(iii) in any case, the Supreme Court; or
(iv) in any case, this Act, the regulations or rules of
35 court; or
(b) a person complains to the Supreme Court or to the
Registrar about an act or omission of a controller of
property of a co-operative in connection with
performing or exercising any of the controller's
40 functions and powers--
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the Supreme Court or the Registrar, as the case may be,
may inquire into the matter and, where the Supreme Court or
Registrar so inquires, the Supreme Court may take such
action as it thinks fit.
5 (2) The Registrar may report to the Supreme Court any matter
that in the Registrar's opinion is a misfeasance, neglect or
omission on the part of a controller of property of a co-
operative and the Court may--
(a) order the controller to make good any loss that the
10 estate of the co-operative has sustained thereby; and
(b) make any other order or orders that it thinks fit.
(3) The Supreme Court may at any time--
(a) require a controller of property of a co-operative to
answer questions about the performance or exercise of
15 any of the controller's functions and powers as
controller; or
(b) examine a person about the performance or exercise
by such a controller of any of the controller's functions
and powers as controller; or
20 (c) direct an investigation to be made of such a
controller's books.
15. Controller may apply to Supreme Court
A controller of property of a co-operative may apply to the
Supreme Court for directions in relation to any matter
25 arising in connection with the performance or exercise of
any of the controller's functions and powers as controller.
(2) In the case of a receiver of property of a co-operative, sub-
clause (1) applies only if the receiver was appointed under a
power contained in an instrument.
30 16. Power of Supreme Court to fix receiver's remuneration
(1) The Supreme Court may by order fix the amount to be paid
by way of remuneration to any person who, under a power
contained in an instrument, has been appointed as receiver of
property of a co-operative.
35 (2) The power of the Supreme Court to make an order under this
clause--
(a) extends to fixing the remuneration for any period
before the making of the order or the application for
the order; and
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(b) is exercisable even if the receiver has died, or ceased
to act, before the making of the order or the
application for the order; and
(c) if the receiver has been paid or has retained for the
5 receiver's remuneration for any period before the
making of the order any amount in excess of that fixed
for that period, extends to requiring the receiver or the
receiver's personal representatives to account for the
excess or such part of the excess as is specified in the
10 order.
(3) The power conferred by sub-clause (2)(c) must not be
exercised in respect of any period before the making of the
application for the order unless, in the opinion of the
Supreme Court, there are special circumstances making it
15 proper for the power to be so exercised.
(4) The Supreme Court may from time to time vary or amend an
order under this clause.
(5) An order under this clause may be made, varied or amended
on the application of--
20 (a) a liquidator of the co-operative; or
(b) an administrator of the co-operative; or
(c) an administrator of a deed of arrangement executed by
the co-operative; or
(d) the Registrar.
25 (6) An order under this clause may be varied or amended on the
application of the receiver concerned.
(7) An order under this clause may be made, varied or amended
only as provided in sub-clauses (5) and (6).
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17. Controller has qualified privilege in certain cases
A controller of property of a co-operative has qualified
privilege in respect of--
(a) a matter contained in a report that the controller
5 lodges under clause 12 or 13; or
(b) a comment that the controller makes under clause
20(2)(c).
18. Notification of matters relating to controller
(1) A person who obtains an order for the appointment of a
10 receiver of property of a co-operative, or who appoints such
a receiver under a power contained in an instrument, must--
(a) within 7 days after obtaining the order or making the
appointment, lodge notice that the order has been
obtained, or that the appointment has been made, as
15 the case may be; and
(b) within 21 days after obtaining the order or making the
appointment, cause notice that the order has been
obtained, or that the appointment has been made, as
the case may be, to be published in the Government
20 Gazette.
(2) A person who appoints another person to enter into
possession, or take control, of property of a co-operative
(whether or not as agent for the co-operative) for the purpose
of enforcing a charge otherwise than as receiver of that
25 property must--
(a) within 7 days after making the appointment, lodge
notice of the appointment with the Registrar; and
(b) within 21 days after making the appointment, cause
notice of the appointment to be published in the
30 Government Gazette.
(3) A person who enters into possession, or takes control, as
mentioned in sub-clause (2) must--
(a) within 7 days after so entering into possession or
taking control, lodge notice with the Registrar that the
35 person has done so; and
(b) within 21 days after so entering into possession or
taking control, cause to be published in the
Government Gazette notice that the person has done
so--
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unless another person--
(c) appointed the first-mentioned person so to enter into
possession or take control; and
(d) complies with sub-clause (2) in relation to the
5 appointment.
(4) Within 14 days after becoming a controller of property of a
co-operative, a person must lodge with the Registrar notice
in the form approved by the Registrar of the address of the
person's office.
10 (5) A controller of property of a co-operative must, within 14
days after a change in the situation of the controller's office,
lodge with the Registrar notice in the form approved by the
Registrar of the change.
(6) A person who ceases to be a controller of property of a co-
15 operative must--
(a) within 7 days after so ceasing, lodge with the
Registrar notice that the person has so ceased; and
(b) within 21 days after so ceasing, cause notice that the
person has so ceased to be published in the
20 Government Gazette.
19. Statement that receiver appointed or other controller acting
(1) If a receiver of property (whether within or outside this State
or within or outside Australia) of a co-operative has been
appointed, the co-operative must set out, in every public
25 document, and in every eligible negotiable instrument, of the
co-operative, after the name of the co-operative where it first
appears, a statement that a receiver, or a receiver and
manager, as the case requires, has been appointed.
(2) If there is a controller (other than a receiver) of property
30 (whether within Australia or elsewhere) of a co-operative,
the co-operative must set out, in every public document, and
in every eligible negotiable instrument, of the co-operative,
after the co-operative's name where it first appears, a
statement that a controller is acting.
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20. Officers to report to controller about co-operative's affairs
(1) In this clause--
"reporting officer'', in relation to a co-operative in respect
of property of which a person is controller, means a
5 person who was--
(a) in the case of a co-operative other than a
foreign co-operative, a director or secretary of
the co-operative; or
(b) in the case of a foreign co-operative, a local
10 agent of the foreign co-operative--
on the control day.
(2) If a person becomes a controller of property of a co-
operative--
(a) the person must serve on the co-operative as soon as
15 practicable notice that the person is a controller of
property of the co-operative; and
(b) within 14 days after the co-operative receives the
notice, the reporting officers must make out and
submit to the person a report in the form approved by
20 the Registrar about the affairs of the co-operative as at
the control day; and
(c) the person must, within 28 days after receipt of the
report--
(i) lodge with the Registrar a copy of the report
25 and a notice setting out any comments the
person sees fit to make relating to the report or,
if the person does not see fit to make any
comment, a notice stating that the receiver does
not see fit to make any comment; and
30 (ii) send to the co-operative a copy of the notice
lodged in accordance with sub-paragraph (i);
and
(d) the person must, within 28 days after receipt of the
report, if the person became a controller of the
35 property--
(i) because of an appointment as receiver of the
property that was made by or on behalf of the
holder of debentures of the co-operative; or
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(ii) by entering into possession, or taking control, of
the property for the purpose of enforcing a
charge securing such debentures--
and there are trustees for the holders of those
5 debentures, send to those trustees a copy of the report
and a copy of the notice lodged under paragraph
(c)(i).
(3) If notice has been served on a co-operative under sub-clause
(2)(a), the reporting officers may apply to the controller or to
10 the Supreme Court to extend the period within which the
report is to be submitted and--
(a) if application is made to the controller, if the
controller believes that there are special reasons for so
doing, the controller may, by written notice given to
15 the reporting officers, extend that period until a
specified day; and
(b) if application is made to the Supreme Court, if the
Court believes that there are special reasons for so
doing, the Court may, by order, extend that period
20 until a specified day.
(4) As soon as practicable after granting an extension under sub-
clause (3)(a), the controller must lodge a copy of the notice
with the Registrar.
(5) As soon as practicable after the Supreme Court grants an
25 extension under sub-clause (3)(b), the reporting officers
must lodge a copy of the order with the Registrar.
(6) Sub-clauses (2), (3) and (4) do not apply in a case where a
person becomes a controller of property of a co-operative--
(a) to act with an existing controller of property of the co-
30 operative; or
(b) in place of a controller of such property who has died
or ceased to be a controller of such property.
(7) However, if sub-clause (2) applies in a case where a
controller of property of a co-operative dies, or ceases to be
35 a controller of property of the co-operative, before sub-
clause (2) is fully complied with, then--
(a) the references in sub-clauses (2)(b), (c) and (d) to the
person; and
(b) the references in sub-clauses (3) and (4) to the
40 controller--
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include references to the controller's successor and to any
continuing controller.
(8) If a co-operative is being wound up, this clause (including
sub-clause (7)) and clause 21 apply even if the controller and
5 the liquidator are the same person, but with any necessary
modifications arising from that fact.
21. Controller may require reports
(1) A controller of property of a co-operative may, by notice
given to the person or persons, require one or more persons
10 included in one or more of the following classes of persons
to make out as required by the notice, verify by a statement
in writing in the form approved by the Registrar, and submit
to the controller, a report, containing such information as is
specified in the notice as to the affairs of the co-operative or
15 as to such of those affairs as are specified in the notice, as at
a date specified in the notice--
(a) persons who are or have been officers of the co-
operative;
(b) if the co-operative was incorporated within one year
20 before the control day, persons who have taken part in
the formation of the co-operative;
(c) persons who are employed by the co-operative or have
been so employed within one year before the control
day and are, in the opinion of the controller, capable
25 of giving the information required;
(d) persons who are, or have been within one year before
the control day, officers of, or employed by, a co-
operative that is, or within that year was, an officer of
the co-operative.
30 (2) Without limiting the generality of sub-clause (1), a notice
under that sub-clause may specify the information that the
controller requires as to affairs of the co-operative by
reference to information that this Act requires to be included
in any other report, statement or notice under this Act.
35 (3) A person making a report and verifying it as required by
sub-clause (1) must, subject to the regulations, be allowed,
and must be paid by the receiver (or the controller's
successor) out of the controller's receipts, any costs and
expenses incurred in and about the preparation and making
40 of the report and the verification of the report that the
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controller (or the controller's successor) considers
reasonable.
(4) A person must comply with a requirement made under sub-
clause (1).
5 (5) A reference in this clause to the controller's successor
includes a reference to a continuing controller.
22. Controller may inspect books
A controller of property of a co-operative is entitled to
inspect at any reasonable time any books of the co-operative
10 that relate to that property and a person must not fail to
allow the controller to inspect those books at such a time.
23. Lodging controller's accounts
(1) A controller of property of a co-operative must lodge with
the Registrar an account--
15 (a) within 28 days after the end of--
(i) 6 months, or such shorter period as the
controller determines, after the day when the
controller became a controller of property of the
co-operative; and
20 (ii) each subsequent period of 6 months throughout
which the controller is a controller of property
of the co-operative; and
(b) within 28 days after the controller ceases to be a
controller of property of the co-operative.
25 (2) An account must be in the form approved by the Registrar
and show--
(a) the controller's receipts and payments during--
(i) in the case of an account under sub-clause
(1)(a), the 6 months or shorter period, as the
30 case requires; or
(ii) in the case of an account under sub-clause
(1)(b), the period beginning at the end of the
period to which the last account related, or on
the control day, as the case requires; and ending
35 on the day when the controller so ceased; and
(b) except in the case of an account lodged under sub-
clause (1)(a)(i), the respective aggregates of the
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controller's receipts and payments since the control
day.
(3) In the case of--
(a) a receiver appointed under a power contained in an
5 instrument; or
(b) anyone else who is in possession, or has control, of
property of the co-operative for the purpose of
enforcing a charge--
the accounts must also show the following--
10 (c) the amount (if any) owing under that instrument or
charge--
(i) in the case of an account lodged under sub-
clause (1)(a)(i), at the end of the control day
and at the end of the period to which the
15 account relates; or
(ii) otherwise, at the end of the period to which the
account relates--
(d) the controller's estimate of the total value, at the end
of the period to which the account relates, of the
20 property of the co-operative that is subject to the
instrument or charge.
(4) The Registrar may, of the Registrar's own motion or on the
application of the co-operative or a creditor of the co-
operative, cause the accounts lodged in accordance with sub-
25 clause (1) to be audited by a registered company auditor
appointed by the Registrar.
(5) For the purpose of the audit, the controller must furnish the
auditor with any books and information that the auditor
requires.
30 (6) If the Registrar causes the accounts to be audited on the
request of the co-operative or a creditor, the Registrar may
require the co-operative or creditor, as the case may be, to
give security for the payment of the cost of the audit.
(7) The costs of an audit under sub-clause (3) are to be fixed by
35 the Registrar.
(8) The Registrar may if the Registrar thinks fit make an order
declaring that, for the purposes of clause 5(1), the costs of
the audit are taken to be a debt incurred by the controller as
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mentioned in clause 5(1) and, if such an order is made, the
controller is liable accordingly.
(9) A person must comply with a requirement made under this
clause.
5 24. Payment of certain debts, out of property subject to floating
charge, in priority to claims under charge
(1) This clause applies if--
(a) a receiver is appointed on behalf of the holders of any
debentures of a co-operative that are secured by a
10 floating charge, or possession is taken or control is
assumed, by or on behalf of the holders of any
debentures of a co-operative, of any property
comprised in or subject to a floating charge; and
(b) at the date of the appointment or of the taking of
15 possession or assumption of control (in this clause
called the "relevant date'')--
(i) the co-operative has not commenced to be
wound up voluntarily; and
(ii) the co-operative has not been ordered to be
20 wound up by the Supreme Court.
(2) The receiver or other person taking possession or assuming
control of property of the co-operative must pay, out of the
property coming into his, her or its hands, the following
debts or amounts in priority to any claim for principal or
25 interest in respect of the debentures--
(a) first, any amount that in a winding up is payable in
priority to unsecured debts pursuant to section 562 of
the Corporations Law (as adopted and applying under
this Act);
30 (b) next, if an auditor of the co-operative had applied to
the Registrar for consent to his, her or its resignation
as auditor and the Registrar had refused that consent
before the relevant date, the reasonable fees and
expenses of the auditor incurred during the period
35 beginning on the day of the refusal and ending on the
relevant date;
(c) subject to sub-clauses (4) and (5), next, any debt or
amount that in a winding up is payable in priority to
other unsecured debts pursuant to section 556(1)(e),
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(g) or (h) or 560 of the Corporations Law (as adopted
and applying under this Act).
(3) The receiver or other person taking possession or assuming
control of property must pay debts and amounts payable
5 pursuant to sub-clause (2)(c) in the same order of priority as
is prescribed by Division 6 of Part 5.6 of the Corporations
Law (as adopted and applying under this Act) in respect of
those debts and amounts.
(4) If an auditor of the co-operative had applied to the Registrar
10 for consent to his, her or its resignation as auditor and the
Registrar had, before the relevant date, refused that consent,
a receiver must, when property comes to the receiver's
hands, before paying any debt or amount referred to in sub-
clause (2)(c), make provision out of that property for the
15 reasonable fees and expenses of the auditor incurred after
the relevant date but before the date on which the property
comes into the receiver's hands, being fees and expenses in
respect of which provision has not already been made under
this sub-clause.
20 (5) If an auditor of the co-operative applies to the Registrar for
consent to his, her or its resignation as auditor and, after the
relevant date, the Registrar refuses that consent, the receiver
must, in relation to property that comes into the receiver's
hands after the refusal, before paying any debt or amount
25 referred to in sub-clause (2)(c), make provision out of that
property for the reasonable fees and expenses of the auditor
incurred after the refusal and before the date on which the
property comes into the receiver's hands, being fees and
expenses in respect of which provision has not already been
30 made under this sub-clause.
(6) A receiver must make provision in respect of reasonable fees
and expenses of an auditor in respect of a particular period
as required by sub-clause (4) or (5) whether or not the
auditor has made a claim for fees and expenses for that
35 period, but where the auditor has not made a claim, the
receiver may estimate the reasonable fees and expenses of
the auditor for that period and make provision in accordance
with the estimate.
(7) For the purposes of this clause the references in Division 6
40 of Part 5.6 of the Corporations Law (as adopted and
applying under this Act) to the relevant date are to be read as
references to the date of the appointment of the receiver, or
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of possession being taken or control being assumed, as the
case may be.
25. Enforcement of controller's duty to make returns
(1) If a receiver of property of a co-operative--
5 (a) who has made default in making or lodging any return,
account or other document or in giving any notice
required by law fails to make good the default within
14 days after the service on the controller, by any
member or creditor of the co-operative or trustee for
10 debenture holders, of a notice requiring the controller
to do so; or
(b) who has become a controller of property of the co-
operative otherwise than by being appointed a
receiver of the property by a court and who has, after
15 being required at any time by the liquidator of the co-
operative so to do, failed to render proper accounts of,
and to vouch, the controller's receipts and payments
and to pay over to the liquidator the amount properly
payable to the liquidator--
20 the Supreme Court may make an order directing the
controller to make good the default within the time specified
in the order.
(2) An application under sub-clause (1) may be made--
(a) if sub-clause (1)(a) applies, by a member or creditor
25 of the co-operative or by a trustee for debenture
holders; and
(b) if sub-clause (1)(b) applies, by the liquidator of the
co-operative.
26. Supreme Court may remove controller for misconduct
30 If, on the application of a co-operative, the Supreme Court
is satisfied that a controller of property of the co-operative
has been guilty of misconduct in connection with performing
or exercising any of the controller's functions and powers,
the Court may order that, on and after a specified day, the
35 controller cease to act as receiver or give up possession or
control, as the case requires, of property of the co-operative.
27. Supreme Court may remove redundant controller
(1) The Supreme Court may order that, on and after a specified
day, a controller of property of a co-operative--
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(a) cease to act as receiver, or give up possession or
control, as the case requires, of property of the co-
operative; or
(b) act as receiver, or continue in possession or control, as
5 the case requires, only of specified property of the co-
operative.
(2) The Supreme Court may make an order under sub-clause (1)
if it is satisfied that the objectives for which the controller
was appointed, or entered into possession or took control of
10 property of the co-operative, as the case requires, have been
achieved, so far as is reasonably practicable, except in
relation to any property specified in the order under sub-
clause (1)(b).
(3) For the purposes of sub-clause (2), the Supreme Court may
15 have regard to--
(a) the co-operative's interests; and
(b) the interests of the holder of the charge that the
controller is enforcing; and
(c) the interests of the co-operative's other creditors; and
20 (d) any other relevant matter.
(4) The Supreme Court may make an order under sub-clause (1)
on the application of a liquidator appointed for the purposes
of winding up the co-operative in insolvency.
(5) An order under sub-clause (1) may also prohibit the holder
25 of the charge from doing any or all of the following, except
with the leave of the Supreme Court--
(a) appointing a person as receiver of property of the co-
operative under a power contained in an instrument
relating to the charge;
30 (b) entering into possession, or taking control, of the
property for the purpose of enforcing the charge;
(c) appointing a person so to enter into possession or take
control (whether as agent for the chargee or for the co-
operative).
35 28. Effect of clauses 26 and 27
(1) Except as expressly provided in clause 26 or 27, an order
under that clause does not affect a charge on property of a
co-operative.
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(2) Nothing in clause 26 or 27 limits any other power of the
Supreme Court to remove, or otherwise deal with, a
controller of property of a co-operative (for example, the
Supreme Court's powers under clause 14).
5 ------------------
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SCHEDULE 5
SAVINGS AND TRANSITIONAL
1. Definitions
In this Schedule--
5 "transferred co-operative" means a body corporate which
is deemed under clause 4, 5, 6 or 7 to be a co-
operative, association, federation or foreign co-
operative registered under this Act.
2. General savings
10 Unless the contrary intention appears in this Act or the
regulations, all persons things and circumstances appointed
or created by or under the Co-operation Act 1981 or Part
VI of the Housing Act 1983, or existing or continuing under
that Act or Part immediately before the commencement of
15 this clause continue, under and subject to this Act, to have
the same status, operation and effect as they respectively
would have had if this Act had not been enacted.
3. Regulations
The Governor in Council may make regulations of a saving
20 or transitional nature consequent on the enactment or
commencement of this Act.
4. Saving of existing co-operatives
(1) On the commencement of this clause, any existing body
corporate which was a society within the meaning of the Co-
25 operation Act 1981 immediately before that commencement
is deemed--
(a) in the case of an association, to be an association
registered under this Act; and
(b) in the case of a federation, to be a federation
30 registered under this Act; and
(c) in the case of any other society, to be a co-operative
registered under this Act.
(2) On the commencement of this clause, any existing body
corporate which was a rental housing co-operative registered
35 under Part VI of the Housing Act 1983 immediately before
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that commencement is deemed to be a co-operative
registered under this Act.
(3) On the commencement of this clause, any existing body
corporate which was a foreign society registered under Part
5 XI of the Co-operation Act 1981 immediately before that
commencement is deemed to be a foreign co-operative
registered under Part 14 of this Act.
(4) Each transferred co-operative under this clause is the same
legal entity as it was before the commencement of this clause
10 with the same name, rules, directors and membership as it
had immediately before that commencement.
5. Saving of Co-operative Federation of Victoria Ltd
On the commencement of this clause, the Co-operative
Federation of Victoria Ltd. established under the Co-
15 operation Act 1981 is deemed to be registered as an
association under this Act with the same name, rules,
directors and membership as it had immediately before that
commencement.
6. Society or co-operative started to be formed before
20 commencement
(1) If, before the commencement of this clause, a meeting to
form a body as a society had been held under section 53 of
the Co-operation Act 1981 but the body had not been
registered as a society under that Act--
25 (a) sections 52 to 57 and 58(1), (2), (7) and (8) of that
Act continue to apply to the formation of the body as a
society; and
(b) on the registration of the body as a society under
section 53 the society is deemed to be a co-operative
30 registered under this Act.
(2) If, before the commencement of this clause, a meeting to
form a body of persons as a rental housing co-operative had
been held under section 53 of the Co-operation Act 1981 as
incorporated by section 47 of the Housing Act 1983 but the
35 body had not been registered as a rental housing co-
operative under the Housing Act 1983--
(a) sections 47, 48 and 50 of the Housing Act 1983 and
sections 52 to 57 and 58(1), (2), (7) and (8) of the Co-
operation Act 1981 (as incorporated by sections 47
40 and 48 of the Housing Act 1983) continue to apply to
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the formation of the body as a rental housing co-
operative; and
(b) on the registration of the body of persons as a rental
housing co-operative under section 53 of the Co-
5 operation Act 1981 (as incorporated by section 47 of
the Housing Act 1983) the co-operative is deemed to
be a co-operative registered under this Act.
(3) Each transferred co-operative under this clause is the same
legal entity as it was before its deemed registration under
10 this Act with the same name, rules, directors and
membership as it had immediately before that deemed
registration.
(4) A certificate issued by the Registrar of Co-operatives under
section 53(7) of the Co-operation Act 1981 as continuing in
15 force for the purposes of this clause is, for the purposes of
this Act to be taken to be a certificate issued under section
21 of this Act.
7. Mergers
(1) Division 3A of Part III of the Co-operation Act 1981
20 continues to apply to an application made by 2 or more
societies and to a direction to merge made before the
commencement of this clause.
(2) On the registration of the merged society under the Co-
operation Act 1981, the society is deemed to be a co-
25 operative registered under this Act.
(3) Each transferred co-operative under this clause is the same
legal entity as it was before its deemed registration under
this Act with the same name, rules, directors and
membership as it had immediately before that deemed
30 registration.
(4) A certificate issued by the Registrar of Co-operatives under
section 84B of the Co-operation Act 1981 as continuing in
force for the purposes of this clause is, for the purposes of
this Act to be taken to be a certificate issued under section
35 303 of this Act.
8. Rules to conform with Act
(1) A transferred co-operative must bring its rules into
conformity with this Act and the regulations--
(a) within 2 years after the commencement of this clause;
40 or
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(b) within such further period as may be approved by the
Registrar in respect of a particular co-operative.
(2) The rules of the transferred co-operative are deemed to be
valid until--
5 (a) the co-operative complies with sub-clause (1); or
(b) the expiry of the relevant period under sub-clause (1).
(3) If there is any inconsistency between a provision of this Act
and the rules of the co-operative as to the procedure for
alteration of the rules of the co-operative, the provision of
10 this Act prevails.
(4) Nothing in this clause affects the operation of Division 2 of
Part 3 in relation to the rules of a transferred co-operative.
9. Modification of certain rules
(1) This clause applies if in the opinion of the Registrar the rules
15 of a transferred co-operative should be altered to achieve
conformity with any requirement of this Act.
(2) The Registrar may, by instrument served on the transferred
co-operative, require it within a period specified in the
instrument to alter its rules--
20 (a) in a manner specified in the instrument; or
(b) in a manner approved by the Registrar.
(3) If within the period specified in the instrument the co-
operative fails to alter its rules as required by the instrument,
the Registrar may by notation on the registered copy of the
25 rules alter the rules.
(4) The Registrar must give written notice to a co-operative of
any alteration of its rules made by him or her under this
clause.
(5) Any alteration made by the Registrar to the rules under this
30 clause is as valid and effectual as an alteration made and
registered under Part 5.
10. Rules to contain active membership provisions
The board of directors of a transferred co-operative must
comply with Division 2 of Part 6 of this Act--
35 (a) within 2 years of the commencement of this clause; or
(b) within any further period approved by the Registrar in
respect of a particular co-operative.
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11. Special resolutions and majority resolutions
(1) A special resolution passed by a transferred co-operative
under the Co-operation Act 1981 and not registered under
that Act before the commencement of this clause may be
5 registered by the Registrar of Co-operatives under this Act.
(2) A majority resolution passed by a transferred co-operative
under the Housing Act 1983 and not registered under that
Act before the commencement of this clause may be
registered by the Registrar of Co-operatives as a special
10 resolution under this Act.
12. Documents
A certificate or other document, relating to a transferred co-
operative, issued or registered by, filed or lodged with or
given to the registrar of co-operatives under the Co-
15 operation Act 1981 or the registrar of rental housing co-
operatives under the Housing Act 1983 has effect as if it
were a certificate or other document issued or registered by,
filed or lodged with or given to the Registrar of Co-
operatives under this Act.
20 13. Existing accounts provisions to apply to transferred
co-operatives
(1) Despite anything to the contrary in this Act or the
regulations, Part VI of the Co-operation Act 1981 applies
and continues to apply to a transferred co-operative until the
25 end of the financial year of that co-operative next following
the commencement of this clause.
(2) Divisions 5 and 6 of Part 9 of this Act do not apply to a
transferred co-operative during the period that Part VI of the
Co-operation Act 1981 applies to it under sub-clause (1).
30 14. Receivers and managers
If, immediately before the commencement of this clause,
there was a receiver or manager or an administrator or
official manager of a transferred co-operative, Part VII or
Part IX of the Co-operation Act 1981 continues to apply to
35 the transferred co-operative and the appointment of the
receiver or manager, or the administrator or official
manager, despite the enactment of this Act.
15. Winding up
If, before the commencement of this clause, a transferred co-
40 operative had commenced to be wound up under Part X of
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the Co-operation Act 1981, that Part and sections 237, 238
and 239 of that Act continue to apply to that winding up.
16. Investigation
If, before the commencement of this clause, an investigation
5 had commenced in respect of a transferred co-operative
under Division 2 of Part XII of the Co-operation Act 1981,
that Division continues to apply in relation to that
investigation.
17. Registrar
10 (1) The person holding the offices of registrar of co-operative
societies under the Co-operation Act 1981 and registrar of
rental housing co-operatives under the Housing Act 1983
immediately before the commencement of this clause is
deemed on that commencement to be appointed as Registrar
15 of Co-operatives under this Act.
(2) A person holding the offices of deputy registrar of co-
operative societies under the Co-operation Act 1981 and
deputy registrar of rental housing co-operatives under the
Housing Act 1983 immediately before the commencement
20 of this clause is deemed on that commencement to be
appointed as a Deputy Registrar under this Act.
(3) Unless the contrary intention appears in this Act or the
regulations, all acts, matters and things of a continuing
nature done or commenced before the commencement of this
25 clause by or on behalf of or in relation to--
(a) the registrar of co-operative societies under the Co-
operation Act 1981 shall not be affected and shall,
under and subject to this Act, continue to have the
same status, operation and effect as they would have
30 had if the Co-operation Act 1981 had not been
repealed; or
(b) the registrar of rental housing co-operatives under the
Housing Act 1983 shall not be affected and shall,
under and subject to this Act, continue to have the
35 same status, operation and effect as they would have
had if Part VI of the Housing Act 1983 had not been
repealed.
(4) If any provision of the Co-operation Act 1981 is continued
in operation by this Schedule, any reference in that provision
40 to the registrar is to be taken for the purposes of that
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continued operation to be a reference to the Registrar of Co-
operatives under this Act.
18. Superseded references
On and from the commencement of this clause, any
5 reference in any other Act, or regulation or any other
document--
(a) to the Co-operation Act 1981 is deemed to be a
reference to this Act; and
(b) to a society or co-operative society within the meaning
10 of the Co-operation Act 1981 is deemed to be a
reference to a co-operative registered under this Act.
------------------
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SCHEDULE 6
AMENDMENT OF OTHER ACTS
1. Accident Compensation Act 1985
1.1 For section 13(1)(b) substitute--
5 "(b) a co-operative within the meaning of the Co-
operatives Act 1996.".
2. Alpine Resorts Act 1983
2.1 In section 28(3) omit "society".
3. Associations Incorporation Act 1981
10 3.1 In section 10(1) for "Co-operation Act 1981" substitute
"Co-operatives Act 1996".
3.2 In section 11(1)(a) "Co-operation Act 1981" substitute
"Co-operatives Act 1996".
4. Borrowing and Investment Powers Act 1987
15 4.1 In section 29(1) for "co-operative society under the Co-
operation Act 1981" substitute "co-operative under the
Co-operatives Act 1996".
4.2 In section 29(2) for "co-operative society under the
Co-operation Act 1981" substitute "co-operative under the
20 Co-operatives Act 1996".
5. Estate Agents Act 1980
5.1 In section 55(9)(a)(ii) for "society formed under the Co-
operation Act 1981" substitute "co-operative registered
under the Co-operatives Act 1996".
25 6. Financial Institutions Duty Act 1982
6.1 In section 4(2)--
(a) after "society" (wherever occurring) insert "or co-
operative";
(b) for "Co-operation Act 1981" substitute
30 "Co-operatives Act 1996";
(c) before "within" insert "a society".
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7. Fundraising Appeals Act 1984
7.1 For section 6(1)(m) substitute--
"(m) a non-trading co-operative registered under the Co-
operatives Act 1996;".
5 8. Housing Act 1983
8.1 In section 4 omit the definition of "registrar"
8.2 In section 6(1)(g) for "rental housing co-operatives"
substitute "non-trading co-operatives engaged in the
provision of rental housing to their members".
10 8.3 In section 34 for "rental housing co-operative" (wherever
occurring) substitute "non-trading co-operative".
8.4 Section 73(1)(g) is repealed.
9. Industrial and Provident Societies Act 1958
9.1 In section 41A(1)(c) for "Co-operation Act 1981"
15 substitute "Co-operatives Act 1996";
9.2 For section 47C substitute--
"47C. Voluntary registration under Co-operatives Act 1996
A society that is registered under this Act may apply
to be registered as a co-operative under the
20 Co-operatives Act 1996.".
9.3 In section 47D(1)--
(a) omit "or 47C";
(b) omit "or the registrar of co-operative societies";
(c) omit "or the Co-operation Act 1981".
25 9.4 In section 47D(4) omit "or co-operative society" (wherever
occurring).
9.5 For section 47E(1)(b) substitute--
"(b) direct the society to apply to the Registrar of
Co-operatives to become registered as a co-operative
30 under the Co-operatives Act 1996; or".
9.6 In section 47F for "co-operative society" (wherever
occurring) substitute "co-operative".
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10. Liquor Control Act 1987
10.1 In section 147(1)(b)--
(a) for "co-operative society" substitute "co-operative";
(b) for "co-operative societies" substitute "co-
5 operatives";
11. Property Law Act 1958
11.1 For section 28B(1)(a)(ii) substitute--
"(ii) of a co-operative registered under the Co-operatives
Act 1996 or any corresponding previous enactment;".
10 12. Stamps Act 1958
12.1 In the Third Schedule in Heading IV(A), in exemption (2)
for "registered co-operative society" substitute "registered
co-operative".
12.2 In the Third Schedule in Heading VI, exemption (8) is
15 repealed.
12.3 In the Third Schedule in Heading XXII in exemption (2)
omit "registered co-operative society,".
13. Transfer of Land Act 1958
13.1 For section 98CB(2)(c)(ii) substitute--
20 "(ii) Registrar of Co-operatives if the service company was
registered under the Co-operatives Act 1996.".
13.2 For section 98CC(1)(d)(ii) substitute--
"(ii) on the Registrar of Co-operatives if the service
company was registered under the Co-operatives Act
25 1996.".
14. Unclaimed Moneys Act 1962
14.1 In section 9(1) in the definition of "business" for paragraph
(g) substitute--
"(g) a co-operative registered under the Co-operatives Act
30 1996;".
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Notes
Act No.
NOTES
i
Section 100 of the Magistrates Court Act 1989 permits certain matters to
be heard in the Magistrates' Court rather than the Supreme Court if the
parties agree.
By Authority. Government Printer for the State of Victoria.
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