Commonwealth Numbered Regulations - Explanatory Statements

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BANKRUPTCY RULES (AMENDMENT) 1996 NO. 191

STATUTORY RULES 1996 No. 191

ISSUED BY THE AUTHORITY OF THE ATTORNEY-GENERAL AND MINISTER FOR JUSTICE

BANKRUPTCY ACT 1966

BANKRUPTCY RULES (AMENDMENT)

Paragraph 315(1)(f) of the Bankruptcy Act 1966 (the Act) provides that the Governor-General may make rules in relation to the fees or other payments to be charged in respect of proceedings under the Act.

Schedule 4 of the Bankruptcy Rules provides for fees to be taken in the office of the Registrar of the Federal Court.

Item 1 of Schedule 4 provides for a fee of $368 for the presentation of a petition under sections 43 or 244 of the Act. Item 9 of Schedule 4 provides for a fee of $368 for an application to the Court in respect of which no other fee is prescribed.

The purpose of the Rules is to increase these fees. The overall level of cost recovery in all Commonwealth courts and tribunals is being increased to bring it into line with the average level of cost recovery in the State and Territory courts and part of the overall Government strategy to reduce the Budget deficit.

Exemption and waiver provisions, for those who would suffer hardship if they had to pay fees, will be brought into line with those in the Federal Court and will provide a wider protection for the disadvantaged.

The Rules provide that the fees for Items 1 and 9 of Schedule 4 be increased to $800 for a noncorporate litigant and $1,600 for a corporate litigant.

Both these items serve to commence proceedings in the Federal Court. The Federal Court Regulations provide that the fee for filing a document whereby a proceeding in the Court is commenced is $800 for a non-corporate litigant and $1,600 for a corporate litigant. The Rules ensure that the fees for commencing bankruptcy proceedings in the Federal Court, for both corporate and non-corporate litigants, are commensurate with the fees for commencing all other proceedings in the Federal Court.

Details of the Rules are as follows:

Rule 1 - Commencement

Rule 1 provides for these Rules to commence on 1 September 1996.

Rule 2 - Amendment

Rule 2 provides for the Bankruptcy Rules to be amended as set out in these Rules.

Rule 3 - Rule 179 (Fees and percentages)

Subrule 3.1 inserts new subrules 179(1AAA) and 179(1 AA).

New subrule 179(1AAA) provides that if a corporation is liable to pay a fee prescribed by rule 179, under item 1 or 9 in Schedule 4, the amount of the fee payable is twice the amount of the fee specified in the Schedule.

New subrule 179(1AA) provides that "corporate" has the same meaning as in the Corporations Law.

Subrule 3.2 provides that the existing waiver provisions in the Bankruptcy Rules, for those in receipt of legal aid, do not apply for a fee specified in item 1 or 9 of Schedule 4. This is because for the fees specified in items 1 and 9 of Schedule 4 are now covered by the more extensive waiver provisions, including waiver for those in receipt of legal aid, contained in new rule 183A. Subrule 3.2 also inserts a now after existing subrule 179(1A) to explain this.

Rule 4 - New rules 179A and 179B

Rule 3 inserts new rules 179A and 179B.

New rule 179A provides that a fee, prescribed by rule 179 (which are the fees that are being increased by these Regulations), is increased biennially, on the anniversary of 1 July 1996.

New rule 179B provides for the method by which the increase is to be calculated. New subrule 179B(1) defines a number of the terms necessary to calculate the increase, including CPI number which is defined as being the All Groups Consumer Price Index number (being the weighted average of the 8 Australian capital cities) published by the Australian Statistician.

New subrule 179B (2) provides the formula for calculating the fee increases. As examples of how the increases are to be calculated: at the end of the 2 year period commencing 1 July 1996, the each of the existing fees will be multiplied by the CPI number for the March quarter 1998 and divided by the CPI number for the March quarter 1996. The fees will only be increased if the CPI number for the March quarter 1998 is greater than that for the March quarter 1996. Similarly, at the end of the 2 year period commencing 1 July 1998, each of the existing fees will be multiplied by the CPI number for the March quarter 2000 and divided by the CPI number for the March quarter 1998. Again, the fees will only be increased if the CPI number for the March quarter 2000 is greater than that for the March quarter 1998.

New subrule 179B(3) provides for the rounding of the increased fees to the nearest whole dollar and, if the amount to be rounded is 50 cents, rounded down.

New subrule 179B(4) provides that if the Australian Statistician publishes a replacement CPI number in respect of an already published CPI number for a March quarter, the replacement CPI number is to be disregarded. The effect of this subregulation is that once the fees have been increased biennially, in accordance with officially published CPI numbers, any alteration in the CPI numbers won't necessitate an alteration in the increased fees during the biennium.

New subrule 179B(5) provides that if the Australian Statistician changes the reference base for the CPI then the new reference base will be adopted for the purposes of these Regulations.

Rule 5 - Rule 183 (Postponement. waiver or remission of certain fees by Registrar)

Subrule 5.1 inserts a new subrule 183(4) which provides that the existing waiver provisions in relation to fees prescribed by these Regulations do not apply to Item 1 or 9 in Schedule 4. Waiver provisions consistent with those that exist in the Federal Court apply to Items 1 and 9 in Schedule 4 pursuant to new rule 183A.

Rule 6 - New rule 183A

Subrule 6.1 inserts new rule 183A which deals with exemption and waivers from a fee in Items 1 or 9 in Schedule 4. The provisions are the same as in the Federal Court Regulations.

The Rules provide that a fee is not payable if the applicant is in receipt of legal aid (paragraph (a)). The Rules also provide (paragraph (b)) that the fee is not payable if the applicant is:

*       the holder of one of a number of current cards issued by the Department of Social Security (subparagraph (i)); or

*       the holder of any other card issued by the Department of Social Security or the Department of Veteran's Affairs that certifies entitlement to Commonwealth health concessions (subparagraph (ii)); or

*       an inmate of a prison or otherwise detained (subparagraph (iii)); or

*       a child under 18 years old (subparagraph (iv)); or

*       in receipt of AUSTUDY (subparagraph (v)) or benefits under ABSTUDY (subparagraph (vi)).

Paragraph 183A(c) provides that the fee is not payable if the Registrar, having regard to the income, day to day living expenses, assets and liabilities of the person liable to pay the fee, waives the fee on the ground of financial hardship.

These Rules ensure that the provisions regarding exemption from liability to pay fees are consistent with the provisions regarding exemption from liability to pay fees in the other Commonwealth courts and the Administrative Appeals Tribunal.

Rule 7 - Schedule 4 (Fees to be taken in the office of the Registrar)

Rule 7 omits $368 and substitutes $800 in Items 1 and 9.

Rule 7 also inserts notes at the end of Schedule 4 explaining that a fee payable by a corporation.

The Rules commence on 1 September 1996.