Commonwealth Numbered Regulations - Explanatory Statements

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FAMILY LAW AMENDMENT REGULATIONS 2004 (NO. 1) 2004 NO. 319

Subsection 125(1) of the Family Law Act 1975 (the Act) provides that the Governor-General may make regulations, not inconsistent with the Act, prescribing all matters that are required or permitted by the Act to be prescribed, or are necessary or convenient to be prescribed for carrying out or giving effect to the Act.

Schedule 6 to the Family Law Amendment Act 2003 (the Amendment Act) commences on 17 December 2004. Schedule 6 inserts a new Part VIIIAA into the Act, to enable a court exercising jurisdiction under the Act (the court) to make orders binding third parties to give effect to property settlement proceedings under the Act. Pursuant to new subsection 90AJ(2) of the Act the court will be able to make an order in relation to the third party's expenses. New subsection 90AJ(4) provides that regulations may be made to enable third parties to recover expenses reasonably incurred in complying with an order of the court, where the court has not made an order for that purpose.

The Regulations amend the Family Law Regulations 1984 (the Principal Regulations) to provide for situations where the court has not made an order in relation to the third party's expenses necessarily incurred in compliance with the court orders.

The Regulations insert a new regulation 15AA into the Principal Regulations which details that a third party may charge fees to cover reasonable expenses necessarily incurred in compliance with the property settlement order, without needing a separate court order. The Regulations give examples of the fees which may reasonably be charged and provide that each of the parties to the marriage is liable for half of the total amount of such fees.

Details of the Regulations are as follows:

Regulation 1 provides that the name of the Regulations is the Family Law Amendment Regulations 2004 (No. 1).

Regulation 2 provides for the Regulations to commence on the date of commencement of Schedule 6 of the Amendment Act, which is 17 December 2004.

Regulation 3 provides that Schedule 1 amends the Family Law Regulations 1984.

Item 1 inserts a new regulation 15AA called 'third party expenses'. Subregulation 15AA(1) makes it clear that regulation 15AA operates where the court has not made an order under subsection 90AJ(2) of the Family Law Act 1975 (the Act) about the expenses incurred by a third party. It does this by reference to subsection 90AJ(4) of the Act which specifically allows regulations to be made to cover the situation where the court has not made an order.

Subregulation 15AA(2) provides for third parties to charge reasonable fees to cover the reasonable expenses that have been incurred in complying with a court order. The expenses must have been a necessary result of compliance with the order.

Subregulation 15AA(3) specifies that the fees are for reasonable expenses incurred in complying with the order about the distribution of the property of the parties to a marriage. It also gives examples of the types of expenses that may be covered. For example, government charges might include stamp duty and valuation fees, transmission of documents might include the cost of facsimiles. Not all the examples in this list will be expenses incurred in every case. The list is intended to be a guide for third parties as to the type of expenses that may be considered to be reasonably incurred and is not an exhaustive list.

Subregulation 15AA(4) provides that it is the parties to the marriage who are liable to pay for the third party's expenses. Each party to the marriage has to pay half of the total amount. This split between the parties to a marriage is specifically provided for under paragraph 90AJ(4)(b) of the Act. The intention is to provide a standard method for sharing of the costs between the parties. If parties are concerned this is not just and equitable, they could go to the court pursuant to subsection 90AJ(2) and seek an order.

Subregulation 15AA(5) provides that the court has the jurisdiction to determine the reasonableness of the fees and to make an order to collect and recover the fees charged by a third party. This would provide a debt recovery jurisdiction additional to that which already exists in State and Territory court systems. It also makes clear that the reasonableness of the charges will be open to scrutiny by the court.