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CORPORATIONS ACT 2001 No. 50, 2001 - SECT 970B

Effect of set-off on claim

(1) If:

(a)
SEGC allows a claim by a person (in this section called the claimant ) in respect of a liability of another person (in this section called the defaulter ); and

(b)
the liability of the defaulter to the claimant has been reduced, by an amount of money or a number of securities (in this section called the set-off reduction ), because of:

(i)
the exercise by the claimant or the defaulter of a right of set-off, whether under an agreement or otherwise; or
(ii)
the operation of an agreement so far as it provides for the automatic set-off of liabilities; and
(c)
but for this section, the reduction of the defaulter's liability would not be taken into account when working out the obligations of SEGC in respect of the claim;

this section applies for the purposes of working out those obligations.

(2) If:

(a)
SEGC is required to satisfy the claim by paying an amount; and

(b)
the set-off reduction consists of an amount;

the amount SEGC must pay in respect of the claim is reduced by the amount of the set-off reduction.

(3) If:

(a)
SEGC is required to satisfy the claim by paying an amount; and

(b)
the set-off reduction consists of a number of securities;

then:

(c)
the Board must work out the value of the securities; and

(d)
the amount SEGC must pay in respect of the claim is reduced by the value worked out under paragraph (c).

(4) If:

(a)
SEGC is required to satisfy the claim by transferring securities of a particular kind; and

(b)
the set-off reduction consists of a number of securities of that kind;

the number of securities that SEGC must transfer in respect of the claim is reduced by the number referred to in paragraph (b).

(5) If:

(a)
SEGC is required to satisfy the claim by transferring securities of a particular kind; and

(b)
the set-off reduction consists of a number of securities that are not of that kind;

then:

(c)
the Board must work out:

(i)
the value of the securities that constitute the set-off reduction; and
(ii)
the number of securities of the kind referred to in paragraph (a) that are equal in value to the value worked out under subparagraph (i); and
(d)
the number of securities that SEGC is required to transfer in respect of the claim is reduced by the number worked out under subparagraph (c)(ii).

(6) If:

(a)
SEGC is required to satisfy the claim by transferring securities of a particular kind; and

(b)
the set-off reduction consists of an amount of money;

then:

(c)
the Board must work out the number of securities of that kind that are equal in value to that amount; and

(d)
the number of securities that SEGC must transfer in respect of the claim is reduced by the number worked out under paragraph (c).


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