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WESTERN AUSTRALIA
FRIENDLY SOCIETIES
(WESTERN AUSTRALIA) BILL 1998
ARRANGEMENT
Page
PART 1 -- PRELIMINARY
1. Short title 2
2. Commencement 2
3. Definitions 2
4. Crown to be bound 3
PART 2 -- FRIENDLY SOCIETIES (WESTERN AUSTRALIA)
CODE
5. Friendly Societies (Western Australia) Code enacted 4
6. Interpretation of expressions in the Friendly Societies
(Western Australia) Code and the Friendly Societies
(Western Australia) Regulations 4
No. 137 -- 1
Friendly Societies (Western Australia)
Bill 1998
PART 3 -- CONFERRAL OF FUNCTIONS AND POWERS
7. Conferral of functions and powers on AFIC 5
8. Conferral of functions and powers on Tribunal 5
9. State supervisory authority 5
PART 4 -- FRIENDLY SOCIETIES (WESTERN AUSTRALIA)
REGULATIONS
10. Definition 6
11. General regulation-making power for the Code 6
12. Savings and transitional regulations for Code 6
PART 5 -- LEVIES, FEES AND OTHER AMOUNTS
13. Fees 8
14. Levies 8
15. Fees, fines and penalties 8
PART 6 -- MISCELLANEOUS
16. Crimes 9
PART 7 -- CONSEQUENTIAL AMENDMENTS
17. Repeal of Friendly Societies Act 1894 10
18. Co-operative and Provident Societies Act 1903
amended 10
19. Equal Opportunity Act 1984 amended 11
20. Financial Institutions (Western Australia) Act 1992
amended 11
21. Housing Loan Guarantee Act 1957 amended 12
22. Pharmacy Act 1964 amended 12
23. Stamp Act 1921 amended 13
24. Western Australian Financial Institutions Authority
Act 1992 amended 13
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Friendly Societies (Western Australia)
Bill 1998
APPENDIX
FRIENDLY SOCIETIES (WESTERN AUSTRALIA) CODE
PART 1 -- PRELIMINARY
Division 1 -- Introductory
1. Citation 17
2. Commencement 17
Division 2 -- Interpretation
3. Definitions 17
4. Associate 23
5. Director 24
6. Holding body corporate 25
7. Holding society 25
8. Making a decision 25
9. Officer 26
10. Related body corporate 26
11. Subsidiary 26
12. Qualified privilege 28
13. Carrying on business: otherwise than for profit 28
14. Businesses of a particular kind 29
15. Carrying on a business: alone or together with others 29
16. Interpretation generally 29
Division 3 -- Operation of Friendly Societies Legislation
17. Extraterritorial operation of legislation 29
Division 4 -- Application and Adoption of Corporations Law
18. Definitions 29
19. Corporations Law applying under its own force 29
20. Corporations Law adopted under a regulation 31
21. Adopted provisions of Corporations Law 31
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PART 2 -- FUNCTIONS AND POWERS OF SSA
Division 1 -- General
22. Functions of SSA 32
23. General powers 32
24. SSA to comply with standards 33
25. Application of variation under standards 33
26. SSA to keep Minister informed 33
27. Inspection of documents at public office 33
28. Power of SSA to reject documents 34
29. Extension or abridgment of time 34
Division 2 -- Specific Powers
Subdivision 1 -- Services corporations
30. Services corporation 35
Subdivision 2 -- Enforcement powers
31. Obtaining information 36
32. Obtaining evidence 37
33. Inspectors 39
34. Inspector to produce identity card 39
35. Entry and search -- monitoring compliance 39
36. Entry and search -- evidence of offences 40
37. General powers of inspector in relation to places 42
38. Monitoring warrants 42
39. Offence related warrants 43
40. Offence related warrant may be granted by telephone 44
41. Obstruction of inspectors 45
42. False or misleading statements 46
Subdivision 3 -- Special meeting and inquiry
43. Special meeting and inquiry 46
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Subdivision 4 -- Special power of intervention
44. Intervention by SSA 48
Subdivision 5 -- Power to suspend operations of society
45. Power to suspend operations 50
Subdivision 6 -- Administrators
46. Appointment of administrator 51
47. Additional powers of SSA 53
48. Stay of proceedings 54
49. Administrator to report to SSA 54
Subdivision 7 -- Levies
50. Supervision Fund 55
51. Supervision levy 55
52. Consultation 56
53. Failure to make payment an offence 56
Subdivision 8 -- Control of advertising
54. Restriction on initial advertisements 56
55. Power to control advertising 57
PART 3 -- SOCIETIES
Division 1 -- Objects
56. Primary objects 58
57. Objects of society must include primary objects 58
58. Dominant activities 58
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Bill 1998
Division 2 -- Formation and Registration
59. Formation of societies 59
60. Registration 60
61. Certificate of incorporation 62
62. Effect of incorporation 62
63. Powers of societies 62
64. Prohibition on issuing debenture 63
65. Restriction on reinsurance arrangements 64
66. Restriction on acting as trustee 64
67. Control of certain financial arrangements 64
68. Control of foreign currency transactions 64
Division 3 -- Rules
Subdivision 1 -- General
69. Rules 65
70. Copies of rules 65
71. Society and members to be bound by rules 65
Subdivision 2 -- Amendment of rules
72. Amendment of rules by special resolution 65
73. Amendment of rules by board of directors 66
74. Registration of amendment of rules 66
75. Power of SSA to require modification of rules 67
Subdivision 3 -- Societies conducting health benefit funds
76. Definitions 68
77. Health benefit fund rules 68
78. Registered society to give notice of rule changes 68
Division 4 -- Standards
79. Societies to comply with standards 68
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Division 5 -- Membership
80. Members 69
81. Members who are minors 69
82. Joint members 70
83. Corporate membership 71
84. Cessation of membership 71
85. Expulsion of member 71
86. Limitation of liability of members 72
Division 6 -- Name and Office
87. Name 72
88. Abbreviations of society's name 73
89. Change of name does not affect identity 73
90. Use of ''friendly society'' 73
91. Unregistered society not to carry on business 74
92. Publication of name 75
93. Common seal 76
94. Society may have duplicate common seal 76
95. Registered office 76
PART 4A -- BENEFIT FUNDS
Division 1 -- Provision of Benefits and Establishment
of Benefit Funds
96. Provision of benefits 77
97. Establishment of benefit fund 77
98. Approval to establish benefit fund 77
Division 2 -- Management of Benefit Funds
99. Assets of benefit funds 78
100. Payments to benefit funds 78
101. Application of benefit fund assets 79
102. Mortgaging assets of benefit fund 79
103. Investment of benefit funds 79
104. Payment of money into account 79
105. Funds inward clearing account 80
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106. Funds outward clearing account 80
107. Transfer of an asset between funds 81
108. Distribution of surplus in benefit fund 82
109. Fair value of assets 82
Division 3 -- Restructure of Benefit Funds
110. Definitions 82
111. Approval of restructure of benefit funds 82
112. Rules 85
113. Lodgement of information with SSA 85
114. When a restructure takes effect 85
115. Effect of restructure 85
116. Notification of members 86
Division 4 -- Termination of Benefit Funds
117. Application of Division 87
118. Approval of termination proposal 87
119. Distribution of assets of benefit fund 89
120. Notification of members 89
121. Rules 90
122. Lodgement of information with SSA 90
123. When termination takes effect 91
Division 5 -- Assignment of Benefits
124. Assignment of benefits 91
125. Payment to nominee of deceased member 92
PART 4B -- OFFERING AND MARKETING OF BENEFITS
Division 1 -- Application and Interpretation
126. Definitions 93
127. Benefits advisory business 94
128. Application of this Part 94
129. Actuarial advice 94
130. Representatives 94
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131. Involvement in contraventions 95
132. Conduct 96
133. References to doing acts 97
134. Misleading representation 97
Division 2 -- Disclosure Documents and Application Forms
135. Disclosure document to be lodged 97
136. Application form 98
137. Form of disclosure document and date of issue 98
138. Disclosure of interests 99
139. Liability in respect of disclosure document and
interests 99
140. Content of disclosure document 99
141. Conditions requiring waiver of requirements void 100
142. Obligation to notify society of false etc. statements 100
143. Correction of false or misleading statements etc. by a
supplementary or replacement disclosure document 101
144. Changes or new matters requiring the issue of a
supplementary or replacement disclosure document 101
145. General provisions about supplementary disclosure
documents 102
146. General provisions about replacement disclosure
documents 103
147. Consequences of lodging a supplementary disclosure
document 103
148. Consequences of lodging a replacement disclosure
document 104
149. Application made on out of date application form 105
150. Inclusion of documents in disclosure documents by
reference 107
151. Disclosure document referring to information set out
in current application form 107
152. Certain notices etc. not to be published 108
153. Certain reports referring to disclosure documents not
to be published 109
154. Evidentiary provisions etc. 111
155. Documents to be kept 112
156. Expert's consent to issue of disclosure document
containing statement by the expert 112
157. Direction not to accept contributions 112
158. Exemptions and modifications 114
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Division 3 -- Prohibited Conduct and Civil Liability
159. Statement in a disclosure document 114
160. Misleading or deceptive conduct 115
161. Mis-statements and omissions in disclosure
documents 115
162. Civil liability for contravention of this Division or
Division 2 116
163. Civil liability for false or misleading statement in, or
omission from, a disclosure document 116
164. No liability to person with knowledge of relevant
matter 117
165. Non-consenting directors not liable 117
166. Directors not liable where they have reasonable
grounds for believing disclosure document to be
correct 118
167. Liability of experts, auditors etc. 120
168. Liability of persons named in disclosure document 121
169. No liability for mistake etc. if reasonable precautions
taken 122
170. Indemnity 123
Division 4 -- Regulation of Industry Participants
Subdivision 1 -- Conduct in relation to benefits
171. Dealing 123
172. Advising 124
Subdivision 2 -- Agreements with unlicensed persons
173. Certain persons not clients 125
174. Agreements with unlicensed persons 126
175. Client may give notice of rescission 126
176. Effect of notice under section 175 127
177. Client may apply to Court for partial rescission 127
178. Court may make consequential orders 128
179. Agreement unenforceable against client 128
180. Non-licensee not entitled to recover commission 129
181. Onus of establishing non-application of section 179
or 180 129
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182. Client may recover commission paid to non-licensee 129
183. Remedies under this Subdivision 129
Subdivision 3 -- Representatives
184. Proper authority from society 130
185. Representatives of dealers 130
186. Representatives of investment advisers 130
187. Representatives of societies 131
188. Body corporate not to act as representative 131
189. Defence 131
190. Banned person not to act as representative 132
191. Society to keep register of holders of proper
authorities 132
192. Society to notify SSA of location and contents of
register 133
193. Inspection and copying of register 134
194. SSA may require production of authority 135
195. SSA may give society information about
representative 135
196. Holder of authority may be required to return it 137
Subdivision 3A -- Exemptions and modifications relating to
representatives
196A. Exemptions and modifications under Subdivision 3 137
Subdivision 4 -- Liability of principals for representatives' conduct
197. Conduct engaged in as a representative 138
198. Liability where identity of principal unknown 138
199. Liability of principals where act done in reliance on
representative's conduct 139
200. Presumptions about certain matters 140
201. No contracting out of liability for representative's
conduct 141
202. Effect of Subdivision 142
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Subdivision 5 -- Excluding persons from dealing with benefits
203. Power to make banning order 142
204. Nature of banning order 143
205. Exceptions to banning order 143
206. Variation or revocation of banning order on
application 144
207. Revocation of banning order in certain cases 144
208. Effect and publication of orders under this
Subdivision 145
209. Contravention of banning order 145
210. Opportunity for hearing 145
211. Disqualification by the Court 146
Subdivision 6 -- Recommendations about benefits
212. Definition of adviser 146
213. Recommendation made by partner or officer 147
214. Client to be told if adviser's interests may influence
recommendation 147
215. Defences to alleged breach of section 214 (2) 148
216. Adviser must have reasonable basis for
recommendation 149
217. Adviser who breaches this Subdivision liable to
compensate client 150
218. Qualified privilege for adviser when complying with
this Subdivision 151
PART 5 -- SHARES AND CHARGES
Division 1 -- Shares Generally
219. Share capital 152
220. Classes of shares, rights etc. 152
221. Determination of share capital 152
222. Liability of shareholders 152
223. Board to approve sale or transfer unless rules provide
otherwise 152
224. Restriction on application of capital 152
225. Power to make certain payments 154
226. Validation of shares improperly issued 154
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Division 2 -- Permanent Shares
227. Issue of permanent shares 155
228. Issue of preference shares 155
229. Rights of holders of preference shares to be set out in
rules 155
230. Cancellation of permanent shares 156
231. Dividends in relation to permanent shares 156
232. Requirements for issue of permanent shares 157
233. Allotment of permanent shares otherwise than for
cash 158
234. Power to exempt in relation to non-cash consideration 159
235. Differences in calls, reserve liability etc. 159
236. Calls and effect of non-compliance with calls on
permanent shares 159
237. Sale of permanent shares forfeited for non-payment
of call 160
238. Prohibition of allotment unless minimum subscription
received 160
239. Return as to allotments 162
240. Issue of permanent shares at premium 163
241. Special resolution for reduction of permanent share
capital 164
242. Society financing dealings in its permanent shares
etc. 167
243. Exceptions 168
244. Consequences of society financing dealings in its
permanent shares etc. 172
245. Prohibition on subsidiary acquiring permanent shares
of holding society 175
246. Options over permanent shares 176
Division 3 -- Redeemable Preference Shares
247. Application of certain provisions of this Code to
redeemable preference shares 176
248. Issue of redeemable preference shares 177
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Division 4 -- Shareholding Restrictions
Subdivision 1 -- Interpretative provisions
249. Application of Division 178
250. Extraterritorial operation of Division 178
251. What constitutes an ''entitlement'' to shares 178
252. What constitutes a ''relevant interest'' in shares 178
253. Meaning of ''associate'' 181
254. Meaning of voting power or right to vote 183
255. Inadvertence or mistake 183
Subdivision 2 -- Maximum shareholdings
256. Maximum permissible shareholding 183
257. Consequences of exceeding maximum permissible
shareholding 184
258. Exceptions 184
Subdivision 3 -- Substantial shareholdings
259. Substantial shareholding and substantial
shareholders 184
Subdivision 4 -- Power to obtain information
260. Power to obtain information 185
Subdivision 5 -- Enforcement
261. Court orders -- substantial shareholdings 186
262. Power of SSA to exempt etc. from Division 186
Division 5 -- Issue of Shares
263. Issuing of shares at a discount prohibited 187
264. Issuing of shares as partly paid up etc. 187
265. Power of SSA to exempt etc. from Division 187
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Division 6 -- Title to and Transfer of Shares
266. Restricted application of this Division 188
267. Document of title to be evidence of title 188
268. Loss or destruction of documents 189
269. Instrument of transfer 190
270. Registration of transfer at request of transferor 191
271. Notice of refusal to register transfer 192
272. Remedy for refusal to register transfer or
transmission 192
273. Certification of transfers 192
274. Duties of society in relation to issue of certificates 193
275. Exemption 194
Division 7 -- Registration of Charges
276. Registration of charges 195
277. Directions by AFIC and SSA 195
278. SSA approval of charges necessary in certain
circumstances 196
PART 6 -- MANAGEMENT
Division 1 -- Interpretation
279. Definition 197
280. When one entity controls another 197
Division 2 -- Directors and Officers
281. Board of directors 197
282. Meetings of directors 198
283. Minutes 198
284. Number of directors 198
285. Election of directors 198
286. Employee directors 199
287. Alternate directors 199
288. Chairperson 200
289. Qualifications of directors 200
290. Vacation of office 201
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291. Removal of directors 201
292. Declaration of interest 202
293. General duty to make disclosure 205
294. Certain financial accommodation to officers
prohibited 206
295. Financial accommodation to directors and associates 206
296. Director's remuneration 208
297. Management contracts 208
298. Duties of directors and officers 209
299. Prohibition on transfer of money 211
300. Unlawfully acting as director 213
Division 3 -- Meetings of Members of a Society
301. Annual general meeting 213
302. Special general meeting 214
303. Quorum 214
304. Notice of meeting 214
305. Voting 215
306. Proxy votes 216
307. Special resolutions of societies 217
308. Minutes 218
Division 4 -- Meetings of Members of a Benefit Fund
309. Application of Division 218
310. Quorum 218
311. Notice of meeting 219
312. Voting 219
313. Proxy votes 220
314. Special resolutions of benefit funds 220
315. Minutes 221
Division 5 -- Registers and Inspection
316. Registers 221
317. Register of directors etc. 222
318. Register of members to be kept 224
319. Registers of members 225
320. Register of holders of permanent shares 225
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321. Power of Court to rectify register of holders of
permanent shares 227
322. Register of options 227
323. Inspection of rules and other documents 228
324. Location of registers on computers 229
325. Form and evidentiary value of registers 230
Division 6 -- Accounts
326. Financial year 231
327. Financial years of groups 232
328. Accounting records to be kept 232
329. Inspection of accounting records 233
330. Profit and loss accounts and balance sheets 233
331. Group accounts 234
332. Audit 234
333. Directors to ascertain certain matters 235
334. Requirements applying to accounts and group
accounts 235
335. Directors' statement 236
336. Directors' reports 237
337. Directors of holding society must obtain information
from entities controlled by the society 243
338. Accounts and reports to be laid before annual general
meeting 245
339. Contravention of Division 245
Division 7 -- Audit
340. Qualifications of auditors 246
341. Appointment of auditors 249
342. Nomination of auditors 252
343. Removal and resignation of auditors 252
344. Effect of winding up on office of auditor 254
345. Fees and expenses of auditors 254
346. Auditor's report 254
347. Powers and duties of auditor 257
348. Final audit on merger, etc. 259
349. Auditors and entities controlled by societies 260
350. Obstruction of auditor 261
351. Qualified privilege 261
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Division 8 -- Actuaries
352. Appointment of actuaries 262
353. Cessation of appointment 263
354. Notification of appointment etc. 263
355. Powers of actuary 264
356. Actuary's obligation to report to SSA 265
357. Qualified privilege of actuary 266
358. Actuarial investigations 266
359. Additional actuarial investigations 267
Division 9 -- Returns and Relief
360. Returns 267
361. Relief from requirements as to accounts, audit and
actuaries 268
PART 7 -- MERGERS OF SOCIETIES AND TRANSFERS OF
ENGAGEMENTS
Division 1 -- Preliminary
362. Definitions 270
363. Application of Part 270
Division 2 -- Mergers and Transfers of Engagements
between Societies
364. Application for registration of merger or transfer 270
365. SSA may register merged society 271
366. Certificate of confirmation (voluntary transfer) 272
367. SSA may direct a transfer of engagements between
societies 273
368. SSA may modify rules to facilitate transfer of
engagements 274
369. Society to comply with direction 274
370. Certificate of confirmation (transfer by direction) 275
371. Who receives the certificate of confirmation 275
372. When transfer of engagements takes effect 275
373. Cancellation of registration after total transfer 275
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374. Effect of merger 275
375. Effect of transfer of engagements 276
Division 3 -- Mergers and Transfers of Engagements Involving
Foreign Societies
376. Definitions in Division 3 277
377. Proposal for merger or transfer of engagements 278
378. SSA may register merged society 279
379. Certificate of confirmation for total transfer 280
380. Certificate of confirmation for partial transfer 281
381. When transfer of engagements takes effect 282
382. Effect of merger 283
383. Effect of transfer of engagements 283
384. Surrender of certificate of incorporation 284
385. Section number not used 284
PART 8 -- CONVERSIONS TO COMPANIES AND
INCORPORATED ASSOCIATIONS
Division 1 -- Conversion to Company
386. Society may convert to company 285
387. Proposal to convert by society to be approved by
members 285
388. SSA may direct as to percentage 286
389. Application by society to SSA for approval of proposal 287
390. Conversion of society to company 288
391. Surrender of certificate of incorporation and
cancellation of registration of society 288
392. Certificate of SSA 289
Division 2 -- Conversion to Incorporated Association
393. Society without benefit fund may convert to
incorporated association 289
394. Proposal to convert to be approved by members or
society's board 289
395. Application by society to SSA for approval of proposal 290
396. Conversion of society to incorporated association 291
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397. Surrender of certificate of incorporation and
cancellation of registration of society 292
398. Certificate of SSA 292
PART 9 -- EXTERNAL ADMINISTRATION
399. Arrangements and reconstructions 293
400. Receivers and other controllers of property of
societies 293
401. Winding-up 293
402. Winding-up on certificate of SSA 293
403. Application of Corporations Law to winding-up 295
404. Voluntary winding-up 295
405. Vacancy in office of liquidator on voluntary winding-
up 295
406. Remuneration of liquidator on voluntary winding-up 296
407. Priority on winding-up 296
408. Determination of amounts to be treated as liabilities 297
409. Cancellation of registration 297
PART 10 -- SPECIAL INVESTIGATIONS
410. Definition 298
411. Appointment of investigators 298
412. Investigation of affairs of related body corporate 299
413. Powers of investigators 299
414. Examination of officers 300
415. Self-incrimination 301
416. Privileged communications 301
417. Failure of officer to comply with requirement of
investigator 302
418. Recording of examination 302
419. Delegation of powers by investigator 303
420. Report of investigator 303
421. Proceedings following investigation 304
422. Admission of investigator's report in evidence 305
423. Expenses of investigation 305
424. Offences 307
425. Defence 307
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Friendly Societies (Western Australia)
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PART 11 -- FOREIGN SOCIETIES
426. Definitions 308
427. Registration 308
428. Agents 310
429. Section number not used 310
430. Liability of agent 310
431. Service on agent 310
432. Application of Code to foreign societies 311
433. SSA to be notified of certain changes 311
434. Section number not used 311
435. Cessation of business 311
436. Society proposing to register as foreign society 311
437. SSA to provide certain documents 312
PART 12 -- ASSOCIATIONS
438. Formation of associations 313
439. Objects of associations 313
440. Registration 313
441. Certificate of incorporation 314
442. Effect of incorporation 314
443. Membership 315
444. Share capital 315
445. Meetings 315
446. Application of Code to associations 315
PART 13 -- REVIEW OF DECISIONS
447. Reviewable decisions 316
448. Application for review of decisions 316
449. Application of AFIC Code 317
450. SSA to review certain decisions 317
PART 14 -- MISCELLANEOUS
Division 1 -- Evidence
451. Certificates etc. 319
452. Rules 319
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453. Registers 319
454. Minutes 320
455. Entries 320
Division 2 -- Offences
456. Defaults by societies 320
457. Restrictions on powers 321
458. Offences by officers 321
459. Incurring debts not likely to be paid 325
460. Powers of Court 325
461. Inducement to be appointed as liquidator 326
462. Falsification of records 327
463. Frauds by officers 327
464. False or misleading information 327
465. Power to examine defaulting officers 328
466. Power of Court to assess damages against certain
persons 330
467. False copies of rules 331
468. Fraud or misappropriation 331
469. Commissions 332
470. Officers and other persons in default 332
Division 3 -- Proceedings
471. Proceedings for offences 332
472. Reciprocity in relation of offences 332
473. Continuing offences 333
474. Injunctions 333
475. Penalty notices 335
476. Power to grant relief 337
Division 4 -- Other matters
477. Secrecy 338
478. Powers about money of members who have died 340
479. Limitation of doctrine of ultra vires 340
480. Abolition of doctrine of constructive notice 341
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PART 15 -- TRANSITIONAL
481. Continuing societies 342
482. Application for certificate of incorporation 342
483. Benefit funds 342
484. Rules 342
485. Subsidiaries 343
486. Directors 343
487. Annual general meeting 343
488. Special resolutions 343
489. Registers 343
489A. Accounts 344
490. Winding-up 344
491. Documents 344
492. Operation of Part 4B 344
493. Interstate society carrying on business in this State 345
SCHEDULE A
MISCELLANEOUS PROVISIONS RELATING TO
INTERPRETATION
PART 1 -- PRELIMINARY
1. Displacement of Schedule by contrary intention 346
PART 2 -- GENERAL
2. Code or Act includes statutory instruments under
Code or Act 346
3. Code to be construed not to exceed legislative power
of Legislature 346
4. Every section to be a substantive enactment 346
5. Material that is, and is not, part of Code 347
6. References to particular Acts 347
7. References taken to be included in Act or Code
citation etc. 347
8. References to commencement of AFIC Code 348
9. Interpretation best achieving Code's purpose 348
10. Use of extrinsic material in interpretation 349
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11. Effect of change of drafting practice and use of
examples 350
12. Compliance with forms 351
PART 3 -- TERMS AND REFERENCES
13. Definitions 351
14. Provisions relating to defined terms and gender and
number 356
15. Meaning of ''may'' and ''must'' 357
16. Words and expressions used in statutory instruments 357
17. Effect of express references to bodies corporate and
individuals 357
18. References to Minister 357
19. Production of records kept in computers etc. 358
20. Application of offence provisions to bodies corporate 359
21. References to this State to be implied 359
22. References to officers and holders of offices 359
23. Reference to certain provisions of this Code 359
24. Words that form part of provision 360
25. Reference to provisions of a Code or an Act is
inclusive 360
PART 4 -- FUNCTIONS AND POWERS
26. Performance of statutory functions 361
27. Power to make instrument or decision includes power
to amend or repeal 361
28. Matters for which statutory instruments may make
provision 361
29. Presumption of validity and power to make 363
30. Appointments may be made by name or office 363
31. Acting appointments 363
32. Powers of appointment imply certain incidental
powers 364
33. Delegation of powers 365
34. Exercise of power between enactment and
commencement 366
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PART 5 -- DISTANCE, TIME AND AGE
35. Matters relating to distance, time and age 369
PART 6 -- SERVICE OF DOCUMENTS
36. Service of documents 369
37. Meaning of service by post 370
38. Time of provision of Code ceasing to have effect 370
PART 7 -- EFFECT OF REPEAL, AMENDMENT OR
EXPIRATION
39. Repealed or amended provision of Code not revived 371
40. Saving of operation of repealed provision of Code 371
41. Continuance of repealed provisions 371
42. Code and amending Acts to be read as one 371
PART 8 -- OFFENCES UNDER CODE
43. Penalty at end of provision 372
44. Penalty other than at end of provision 372
45. Indictable offences and summary offences 372
46. Double jeopardy 373
47. Aiding and abetting, attempts etc. 373
PART 9 -- INSTRUMENTS UNDER CODE
48. Schedule applies to statutory instruments 374
NOTES
COMPARATIVE TABLE OF PROVISIONS OF FRIENDLY
SOCIETIES CODE AND FINANCIAL INSTITUTIONS CODE
xxv
WESTERN AUSTRALIA
LEGISLATIVE ASSEMBLY
FRIENDLY SOCIETIES
(WESTERN AUSTRALIA) BILL 1998
A BILL FOR
AN ACT to provide for the formation, registration,
management and regulation of friendly societies, to
repeal the Friendly Societies Act 1894 and to make
consequential amendments to other Acts, and for
other purposes.
The Parliament of Western Australia enacts as follows:
1
Friendly Societies (Western Australia)
cl. 1 Bill 1998
PART 1 -- PRELIMINARY
Short title
1. This Act may be cited as the Friendly Societies (Western
Australia) Act 1998.
5 Commencement
2. This Act comes into operation on such day as is, or days as
are respectively, fixed by proclamation.
Definitions
3. (1) In this Act unless the contrary intention appears --
10 ''AFIC'' means the Australian Financial Institutions
Commission established by the AFIC Act;
''AFIC Act'' means the Australian Financial Institutions
Commission Act 1992 of Queensland;
''friendly societies legislation of Western Australia''
15 means --
(a) this Act;
(b) the Friendly Societies (Western Australia) Code;
(c) the Friendly Societies (Western Australia)
Regulations;
20 (d) the AFIC (Western Australia) Code, the AFIC
(Western Australia) Regulations, the Financial
Institutions (Western Australia) Code and the
Financial Institutions (Western Australia)
Regulations as applying to the Code and
25 Regulations referred to in paragraphs (b) and (c);
2
Friendly Societies (Western Australia)
Bill 1998 cl. 4
''Friendly Societies (Western Australia) Code'' means
the Code set out in the Appendix;
''Friendly Societies (Western Australia) Regulations''
means the Regulations in force for the time being
5 under Part 4 of this Act;
''Ministerial Council'' means the Ministerial Council
established under the financial institutions agreement
within the meaning of the Financial Institutions
(Western Australia) Act 1992;
10 (2) Words and expressions used in the Friendly Societies
(Western Australia) Code and this Act have the same respective
meanings in this Act as they have in that Code.
(3) Subsection (2) does not apply to the extent that the
content or subject matter otherwise indicates or requires.
15 Crown to be bound
4. (1) This Act binds the Crown in right of Western Australia
and, so far as the legislative power of Parliament permits, the
Crown in all its capacities.
(2) Nothing in this section permits the Crown in any of its
20 capacities to be prosecuted for an offence.
3
Friendly Societies (Western Australia)
cl. 5 Bill 1998
PART 2 -- FRIENDLY SOCIETIES (WESTERN
AUSTRALIA) CODE
Friendly Societies (Western Australia) Code enacted
5. The Friendly Societies (Western Australia) Code has
5 effect.
Interpretation of expressions in the Friendly Societies
(Western Australia) Code and the Friendly Societies
(Western Australia) Regulations
6. (1) In the Friendly Societies (Western Australia) Code and
10 the Friendly Societies (Western Australia) Regulations --
''continuing society'' means a friendly society to which
the Friendly Societies Act 1894 applied immediately
before the commencement of this section;
''Legislature of this State'' means the Legislature of
15 Western Australia;
''pharmacy law of this State'' means the Pharmacy
Act 1964;
''the Code'' or ''this Code'' means the Friendly Societies
(Western Australia) Code;
20 ''the previous law'' means the Friendly Societies Act 1894.
(2) The Corporations (Western Australia) Act 1990 and the
applicable provisions of Western Australia within the meaning of
that Act, are prescribed for the purpose of section 19 (4) of the
Friendly Societies (Western Australia) Code.
4
Friendly Societies (Western Australia)
Bill 1998 cl. 7
PART 3 -- CONFERRAL OF FUNCTIONS AND POWERS
Conferral of functions and powers on AFIC
7. AFIC has the functions and powers conferred or expressed to
be conferred on it by or under the friendly societies legislation of
5 Western Australia.
Conferral of functions and powers on Tribunal
8. The Australian Financial Institutions Appeals Tribunal
established under the AFIC Act has the functions and powers
conferred or expressed to be conferred on it by or under the
10 friendly societies legislation of Western Australia.
State supervisory authority
9. The Western Australian Financial Institutions Authority
established by the Western Australian Financial Institutions
Authority Act 1992 is the State supervisory authority for Western
15 Australia.
5
Friendly Societies (Western Australia)
cl. 10 Bill 1998
PART 4 -- FRIENDLY SOCIETIES (WESTERN
AUSTRALIA) REGULATIONS
Definition
10. In this Part --
5 ''the Code'' means the Code set out in the Appendix, as in
force for the time being.
General regulation-making power for the Code
11. (1) The Governor may make regulations prescribing all
matters that are required or permitted by this Act or the Code to
10 be prescribed or are necessary or convenient for giving effect to
the purposes of this Act or the Code.
(2) A regulation under this Part may only be made on the
recommendation of the Ministerial Council.
(3) A regulation under this Part may create an offence
15 punishable by a penalty not exceeding $5 000.
Savings and transitional regulations for Code
12. (1) A regulation under this Part may make provision of a
savings or transitional nature consequent on the enactment of
the Code or a provision of the Code.
20 (2) If the regulation so provides, it has effect despite any
provision of this Act or the Code.
(3) A provision of a regulation made under this section may,
if the regulation so provides, take effect from the day this Act
receives the Royal Assent or from a later day.
6
Friendly Societies (Western Australia)
Bill 1998 cl. 12
(4) To the extent to which a provision takes effect from a day
earlier than the day of the regulation's publication in the Gazette,
the provision does not operate to the disadvantage of a person
(other than the State or a State authority) by --
5 (a) decreasing the person's rights; or
(b) imposing liabilities on the person.
7
Friendly Societies (Western Australia)
cl. 13 Bill 1998
PART 5 -- LEVIES, FEES AND OTHER AMOUNTS
Fees
13. This section imposes the fees that the Friendly Societies
(Western Australia) Regulations or the AFIC (Western Australia)
5 Regulations prescribe, except to the extent that they are taxes.
Levies
14. (1) Except to the extent that they are taxes, this section
imposes --
(a) the levy payable under sections 119 and 120 of the
10 AFIC (Western Australia) Code by a society; and
(b) the supervision levy payable under section 51 of the
Friendly Societies (Western Australia) Code by a
society.
(2) An expression has in subsection (1) the meaning it would
15 have if this section were in the AFIC (Western Australia) Code or
the Friendly Societies (Western Australia) Code, as the case
requires.
Fees, fines and penalties
15. All fees, fines, penalties and other money which, under or
20 by virtue of the friendly societies legislation of Western Australia
are authorized or directed to be imposed on any person and are
not, under that legislation, fees, levies or other amounts payable
to a specified person are to be paid to the Treasurer of the State
and credited to the Consolidated Fund.
8
Friendly Societies (Western Australia)
Bill 1998 cl. 16
PART 6 -- MISCELLANEOUS
Crimes
16. An offence under the Friendly Societies (Western Australia)
Code that is punishable by imprisonment for a period exceeding 2
5 years is a crime.
9
Friendly Societies (Western Australia)
cl. 17 Bill 1998
PART 7 -- CONSEQUENTIAL AMENDMENTS
Repeal of Friendly Societies Act 1894
17. The Friendly Societies Act 1894 is repealed.
Co-operative and Provident Societies Act 1903 amended
5 18. The Co-operative and Provident Societies Act 1903* is
amended --
(a) in section 2 by deleting the definition of ''The
Registrar'' and substituting the following definition --
''
10 ''The Registrar'' means the person appointed
under and subject to Part 3 of the Public
Sector Management Act 1994 to the office of
Registrar of Co-operative and Financial
Institutions.
15 '';
(b) in the Fourth Schedule --
(i) by deleting ''of Friendly Societies'' in both places
where it occurs; and
(ii) by deleting ''Friendly Societies Office, Perth'' in
20 both places where it occurs and substituting in
each place the following --
''
Registry of Co-operative and Financial
Institutions, Perth
25 ''.
[* Reprinted as authorized 30 September 1969.
For subsequent amendments see 1997 Index to
Legislation of Western Australia, Table 1, p. 52.]
10
Friendly Societies (Western Australia)
Bill 1998 cl. 19
Equal Opportunity Act 1984 amended
19. The Equal Opportunity Act 1984* is amended --
(a) in section 35N (1) (c) by deleting ''Friendly Societies
Act 1894'' and substituting the following --
5 '' Friendly Societies (Western Australia) Code 1998 '';
(b) in section 66ZS (1) (a) (iii) by deleting ''Friendly
Societies Act 1894'' and substituting the following --
'' Friendly Societies (Western Australia) Code 1998 '';
and
10 (c) in section 69 (1) (b) (iii) by deleting ''Friendly Societies
Act 1894'' and substituting the following --
'' Friendly Societies (Western Australia) Code 1998 ''.
[* Reprinted as at 16 April 1996.
For subsequent amendments see 1997 Index to Legislation of
15 Western Australia, Table 1, pp. 76-7.]
Financial Institutions (Western Australia) Act 1992
amended
20. The Financial Institutions (Western Australia) Act 1992* is
amended --
20 (a) in section 7 (1) by inserting in the appropriate
alphabetical position the following definition --
''
''Friendly Societies Code'' means the Friendly
Societies (Western Australia) Code set out
25 in the Appendix to the Friendly Societies
(Western Australia) Act 1998;
'';
and
11
Friendly Societies (Western Australia)
cl. 21 Bill 1998
(b) in section 10 (1) by inserting in the appropriate
alphabetical position the following definition --
''
''Friendly Societies Code'' means the Friendly
5 Societies (Western Australia) Code set out
in the Appendix to the Friendly Societies
(Western Australia) Act 1998;
''.
[* Act No. 30 of 1992.
10 For subsequent amendments see 1997 Index to Legislation of
Western Australia, Table 1, p. 85.]
Housing Loan Guarantee Act 1957 amended
21. Section 5 of the Housing Loan Guarantee Act 1957* is
amended by deleting ''Friendly Societies Act 1894'' and
15 substituting the following --
'' Friendly Societies (Western Australia) Code 1998 ''.
[* Reprinted as authorized 20 May 1974.
For subsequent amendments see 1997 Index to
Legislation of Western Australia, Table 1, p. 109.]
20 Pharmacy Act 1964 amended
22. The Pharmacy Act 1964* is amended --
(a) in section 23 (1) by deleting ''Friendly Societies
Act 1894'' and substituting the following --
'' Friendly Societies (Western Australia) Code 1998 '';
25 (b) in section 36 (1) (b) by deleting ''Friendly Societies
Act 1894'' and substituting the following --
'' Friendly Societies (Western Australia) Code 1998 '';
and
12
Friendly Societies (Western Australia)
Bill 1998 cl. 23
(c) in section 36B (3) (b) by deleting ''Friendly Societies
Act 1894'' and substituting the following --
'' Friendly Societies (Western Australia) Code 1998 ''.
[* Reprinted as authorized 18 April 1983.
5 For subsequent amendments see 1997 Index to Legislation of
Western Australia, Table 1, pp. 178-9]
Stamp Act 1921 amended
23. The Third Schedule to the Stamp Act 1921* is amended in
item (4) (a) by deleting ''Friendly Societies Act 1894'' and
10 substituting the following --
'' Friendly Societies (Western Australia) Code 1998 ''.
[* Reprinted as at 23 January 1996.
For subsequent amendments see 1997 Index to
Legislation of Western Australia, Table 1, pp. 217-20.]
15 Western Australian Financial Institutions Authority
Act 1992 amended
24. The Western Australian Financial Institutions Authority
Act 1992* is amended --
(a) in section 3 by inserting in the appropriate
20 alphabetical positions the following definitions --
''
''Friendly Societies (Western Australia)
Code'' means the Code set out in the
Appendix to the Friendly Societies (Western
25 Australia) Act 1998;
''friendly societies legislation of Western
Australia'' has meaning given to that
expression by the Friendly Societies
(Western Australia) Act 1998;
30 '';
13
Friendly Societies (Western Australia)
cl. 24 Bill 1998
(b) by repealing section 4 and substituting the following
section --
''
Interpretation
5 4. Unless the contrary intention appears,
words and expressions used in this Act that are
defined in --
(a) the scheme legislation of Western
Australia; or
10 (b) the friendly societies legislation of
Western Australia,
have the respective meanings given by those
definitions.
'';
15 (c) in section 6 by inserting after ''Australia'' the
following --
''
, the friendly societies legislation of Western
Australia
20 '';
(d) in section 7 (2) by inserting after ''Australia'' the
following --
''
and the friendly societies legislation of Western
25 Australia
'';
(e) in section 9 by inserting after ''Australia'' the
following --
''
30 , the friendly societies legislation of Western
Australia
'';
14
Friendly Societies (Western Australia)
Bill 1998 cl. 24
(f) in section 45 (4) by deleting ''or the scheme
legislation'' and substituting the following --
'' , the scheme legislation of Western Australia or
5 the friendly societies legislation
'';
(g) in section 45 (5) by deleting ''or the scheme
legislation'' and substituting the following --
''
10 , the scheme legislation of Western Australia or
the friendly societies legislation
'';
(h) in section 50 (2) --
(i) by deleting ''or'' after paragraph (a);
15 (ii) in paragraph (b) by deleting ''Subdivision,'' and
substituting the following --
'' Subdivision; or ''; and
(iii) by inserting after paragraph (b) the following
paragraph --
20 ''
(c) a supervision levy under Part 5 of the
Friendly Societies (Western Australia)
Act 1998,
'';
25 (i) in section 51 by inserting after subsection (2) the
following subsection --
''
(2a) The powers under section 51 of the
Friendly Societies (Western Australia) Code are
30 not to be delegated.
'';
and
15
Friendly Societies (Western Australia)
cl. 24 Bill 1998
(j) in section 52 by inserting after ''legislation'' the
following --
''
or the friendly societies legislation of Western
5 Australia
''.
[* Act No. 29 of 1992.]
16
Friendly Societies (Western Australia)
Bill 1998 App.
APPENDIX
[Section 5]
FRIENDLY SOCIETIES (WESTERN AUSTRALIA) CODE
PART 1 -- PRELIMINARY
5 Division 1 -- Introductory
Citation
1. This Code may be cited as the Friendly Societies (Western
Australia) Code.
NOTE: The sections of this Code have been numbered to
10 correspond with the numbering in the Friendly Societies
Code set out in Schedule 1 to the Friendly Societies
(Victoria) Act 1996 which is in force in other States.
Commencement
2. This Code comes into operation as provided in section 2 of the
15 Friendly Societies (Western Australia) Act 1998.
Division 2 -- Interpretation
Definitions
3. In this Code --
''accounting records'' include --
20 (a) invoices, receipts, orders for the payment of money,
bills of exchange, cheques, promissory notes, vouchers
and other documents of prime entry; and
(b) documents and records that record such entries; and
(c) such working papers and other documents as are
25 necessary to explain the methods and calculations by
which accounts are made up;
''accounting standard'' has the meaning given by section 9 of
the Corporations Law;
17
Friendly Societies (Western Australia)
App. Bill 1998
''accounts'' means profit and loss accounts and balance sheets,
and includes statements, reports and notes (other than a
directors' report) attached to or intended to be read with
any of those accounts or balance sheets;
5 ''advertisement'' includes matter that is not in writing but
because of the form or context in which it appears conveys
a message;
''affairs'', in relation to a body corporate, has the meaning given
by section 53 of the Corporations Law;
10 ''AFIC'' means the Australian Financial Institutions Commission;
''AFIC Code'' means the Code set out in section 21 of the
Australian Financial Institutions Commission Act 1992 of
Queensland;
''applicable accounting standard'' means an accounting
15 standard as applying under section 334;
''Appeals Tribunal'' means the Australian Financial Institutions
Appeals Tribunal established under the Australian
Financial Institutions Commission Act 1992 of Queensland;
''association'' means a body registered as an association under
20 Part 12;
''bank'' means --
(a) a bank as defined by section 5 of the Banking
Act 1959 of the Commonwealth; or
(b) a bank constituted under a law of a State;
25 ''benefit'', in relation to a society, means an interest in a benefit
fund of the society in accordance with the rules of the
society relating to that fund;
''benefit fund'' in relation to a society, means a fund established
by the society in accordance with Part 4A;
30 ''board'', in relation to a society, means the board of directors of
the society;
''body'' includes an entity;
18
Friendly Societies (Western Australia)
Bill 1998 App.
''body corporate'' means any body corporate whether formed or
incorporated within or outside this State, but does not
include --
(a) a body corporate that is incorporated within Australia
5 or an external Territory and is a public authority or
an instrumentality or agency of the Crown; or
(b) a corporation sole;
''borrow'' means to obtain financial accommodation;
''building society'' means a building society within the meaning
10 of the Financial Institutions (Western Australia) Code or a
law of another State that corresponds to that Code;
''certificate of confirmation'' has the meaning given by
section 362;
''company'' means a company incorporated, or taken to be
15 incorporated, under the Corporations Law;
''consolidated accounts'', in relation to a society, means all of
the following --
(a) a consolidated profit and loss account that section 331
requires to be made out in relation to a financial year
20 of the society;
(b) a consolidated balance sheet that section 331 requires
to be made out in relation to the financial year of the
society;
(c) statements, reports and notes (other than a directors'
25 report) attached to, or intended to be read with, that
consolidated profit and loss account or consolidated
balance sheet;
''Court'' means the Supreme Court or a Supreme Court Judge of
this State;
30 ''credit union'' means a credit union within the meaning of the
Financial Institutions (Western Australia) Code or a law of
another State that corresponds to that Code;
''debenture'' has the meaning given by section 9 of the
Corporations Law;
35 ''director'' has the meaning given by section 5;
''disclosure document'' means a document lodged with the SSA
under Part 4B and that complies, or ought to comply, with
the requirement for disclosure documents under that Part;
19
Friendly Societies (Western Australia)
App. Bill 1998
''economic entity'' means an economic entity for the purposes of
Part 3.6 of the Corporations Law;
''employee'', in relation to the SSA, includes --
(a) an officer of the SSA; and
5 (b) a person whose services are made available to the
SSA; and
(c) a person engaged by the SSA on a contract for
services;
''entity'' means an entity for the purposes of Part 3.6 of the
10 Corporations Law, and includes a society;
''executive officer'', in relation to a society or entity, means a
person (by whatever name called) who is concerned, or
takes part, in the management of the society or entity;
''expert'', in relation to a matter, means an independent person
15 whose profession or reputation gives authority to a
statement made by the person in relation to the matter;
''Financial Institutions Code'' means the Code set out in
section 30 of the Financial Institutions (Queensland)
Act 1992 of Queensland;
20 ''financial institutions scheme'' means the scheme established
and implemented by the financial institutions agreement
and the financial institutions legislation within the
meaning of the AFIC Code;
''foreign society'' means a body registered as a foreign society
25 under Part 11;
''friendly societies legislation'' means --
(a) the friendly societies legislation of Western Australia,
namely --
(i) the Friendly Societies (Western Australia)
30 Act 1998 and the Friendly Societies (Western
Australia) Code set out in the Appendix to the
Act; and
(ii) regulations made under that Act; and
20
Friendly Societies (Western Australia)
Bill 1998 App.
(b) the friendly societies legislation of Victoria,
namely --
(i) the Friendly Societies (Victoria) Act 1996 of
Victoria and the Friendly Societies Code set out
5 in Schedule 1 to the Act; and
(ii) regulations made under that Act; and
(c) the friendly societies legislation of the other
participating States, namely --
(i) the Acts and regulations of the other
10 participating States that apply, complement or
otherwise give effect to any part of the friendly
societies legislation of Victoria; and
(ii) the friendly societies legislation of Victoria as
applying in those States; and
15 (d) the financial institutions legislation within the
meaning of the AFIC Code so far as it applies or is
otherwise relevant to the legislation mentioned in
paragraph (a), (b) or (c);
''fund'', in relation to a society, means --
20 (a) a benefit fund of the society; or
(b) the management fund of the society;
''group'' means an economic entity of which a society is a part;
''group accounts'', in relation to a holding society, means a set
of consolidated accounts for the group in relation to which
25 the society is the holding society;
''holding body corporate'' has the meaning given by section 6;
''holding society'' has the meaning given by section 7;
''inspector'' means a person authorized under section 33;
''issue'' includes circulate, distribute and disseminate;
30 ''management fund'', in relation to a society, means the fund of
the society consisting of the assets and liabilities of the
society that do not form part of a benefit fund of the society;
''member'' --
(a) in relation to a society, means a person who is a
35 member of the society under Division 5 of Part 3; and
21
Friendly Societies (Western Australia)
App. Bill 1998
(b) in relation to a benefit fund of a society, means a
person entitled to a benefit from that fund in
accordance with the rules of the society;
''national business names register'' has the meaning given by
5 the Corporations Law;
''officer'' has the meaning given by section 9;
''participating State'' means --
(a) Western Australia;
(b) Victoria
10 (c) any other State in which there is in force a law
corresponding to Part 2 of the Friendly Societies
(Victoria) Act 1996 of Victoria;
''permanent share'', in relation to a society, means a share in
the society other than a redeemable preference share;
15 ''profit or loss'' means --
(a) in relation to an entity, the profit or loss resulting
from operations of the entity; and
(b) in relation to 2 or more entities or an economic entity
constituted by 2 or more entities, the profit or loss
20 resulting from the operations of those entities;
''publish'' --
(a) in relation to a notice under Part 4B, means publish
by any means, including in a newspaper or periodical,
by broadcasting or televising or in a cinematograph
25 film; and
(b) in any case, includes issue;
''redeemable preference share'' means a preference share in a
society that is, or at the society's option is, liable to be
redeemed;
30 ''registered company auditor'' means a person registered as an
auditor, or taken to be registered as an auditor, under Part
9.2 of the Corporations Law;
''relevant agreement'' means an agreement, arrangement or
understanding --
35 (a) whether formal or informal or partly formal and
partly informal;
22
Friendly Societies (Western Australia)
Bill 1998 App.
(b) whether written or oral or partly written and partly
oral; and
(c) whether or not having legal or equitable force and
whether or not based on legal or equitable rights;
5 ''rules'', in relation to a society, means rules of the society under
this Code as in force from time to time;
''securities'' has the meaning given by section 92 of the
Corporations Law;
''services corporation'' means a body corporate declared to be a
10 services corporation under section 30;
''share'' means a share in the share capital of a body corporate;
''society'' means a body registered under this Code as a society;
''SSA'', in relation to a State, means the person or body declared
by the friendly societies legislation of the State to be the
15 State supervisory authority for the State;
''standard'' means a standard in force under section 28 of the
AFIC Code;
''State'' means a State or Territory;
''subsidiary'' has the meaning given by section 11;
20 ''transferee society'' has the meaning given by section 362;
''transferor society'' has the meaning given by section 362.
Associate
4. (1) For the purposes of this Code, except Division 4 of Part 5 and
section 295, a person is an ''associate'' of another, or is associated with
25 another, if --
(a) they are partners; or
(b) one is a spouse, parent or child of the other; or
(c) they are both trustees or beneficiaries of the same trust, or
one is a trustee and the other is a beneficiary of the same
30 trust; or
(d) one is a body corporate or other entity (whether inside or
outside Australia) and the other is a director or member of
the governing body of the body or entity; or
23
Friendly Societies (Western Australia)
App. Bill 1998
(e) one is a body corporate or other entity (whether inside or
outside Australia) and the other is a person who has a legal
or equitable interest in 5% or more of the share capital of
the body or entity; or
5 (f) they are related bodies corporate within the meaning of
section 10; or
(g) a relationship of a prescribed kind exists between them; or
(h) a chain of relationships can be traced between them under
any one or more of the above paragraphs.
10 (2) For the purposes of Part 4B, a person is an ''associate'' of
another, or is associated with another, if --
(a) the person is such an associate, or is so associated, under
subsection (1); or
(b) the other person is a director of a body corporate of which
15 the first-mentioned person is also a director and which
carries on a business of dealing in benefits.
Director
5. (1) Subject to subsection (2), for the purposes of this Code,
''director'', in relation to a body corporate, includes a reference to --
20 (a) a person occupying or acting in the position of director of
the body, by whatever name called and whether or not
validly appointed to occupy, or duly authorized to act in,
the position; and
(b) a person in accordance with whose directions or instructions
25 the directors of the body corporate are accustomed to act;
and
(c) in the case of a body corporate incorporated outside
Australia --
(i) a member of the body's board; and
30 (ii) a person occupying or acting in the position of
member of the body's board, by whatever name called
and whether or not validly appointed to occupy, or
duly authorized to act in, the position; and
(iii) a person in accordance with whose directions or
35 instructions the members of the body's board are
accustomed to act.
24
Friendly Societies (Western Australia)
Bill 1998 App.
(2) A person is not to be regarded as a person in accordance with
whose directions or instructions --
(a) a body corporate's directors; or
(b) the members of the board of a body corporate incorporated
5 outside Australia,
are accustomed to act merely because the directors or members act on
advice given by the person in the proper performance of the functions
attaching to --
(c) the person's professional capacity; or
10 (d) the person's business relationship with the directors, the
members of the board or the body.
Holding body corporate
6. A reference in this Code to the holding body corporate of another
body corporate is a reference to a body corporate of which the other
15 body corporate is a subsidiary.
Holding society
7. A society is a holding society in respect of a financial year of the
society if the society controls another entity during all or part of the
financial year.
20 Making a decision
8. A reference in this Code to the making of a decision includes a
reference to --
(a) making, suspending, revoking or refusing to make an order
or determination; or
25 (b) giving, suspending, revoking or refusing to give a
certificate, direction, approval, consent or permission; or
(c) issuing, suspending, revoking or refusing to issue a licence,
authority or other instrument; or
(d) imposing a condition or restriction; or
30 (e) making a declaration, demand or requirement; or
(f) retaining, or refusing to deliver up, an article; or
(g) doing or refusing to do anything else.
25
Friendly Societies (Western Australia)
App. Bill 1998
Officer
9. (1) Subject to subsection (2), for the purposes of this Code,
''officer'', in relation to a body corporate or entity, includes --
(a) a director, secretary, executive officer or employee of the
5 body or entity; and
(b) a receiver and manager, appointed under a power contained
in an instrument, of property of the body or entity; and
(c) a liquidator of the body or entity appointed in a voluntary
winding-up of the body or entity; and
10 (d) a trustee or other person administering a compromise or
arrangement made between the body or entity and other
persons.
(2) None of the following is an officer of the body corporate or
entity --
15 (a) a receiver who is not also a manager;
(b) a receiver and manager appointed by a court;
(c) a liquidator appointed by a court.
Related body corporate
10. If a body corporate is --
20 (a) the holding body corporate of another body corporate; or
(b) a subsidiary of another body corporate; or
(c) a subsidiary of the holding body corporate of another body
corporate,
the first body corporate and the other body corporate are related to each
25 other.
Subsidiary
11. (1) Subject to subsection (5), a body corporate is a subsidiary of
a society if --
(a) the society --
30 (i) controls the composition of the body corporate's board
of directors; or
26
Friendly Societies (Western Australia)
Bill 1998 App.
(ii) is in a position to cast, or control the casting of, more
than 50% of the maximum number of votes that
might be cast at a general meeting of the body
corporate; or
5 (iii) holds more than 50% of the issued share capital of
the body corporate (other than any part of that issued
share capital that carries no right to participate
beyond a specified amount in a distribution of either
profits or capital); or
10 (b) the body corporate is a subsidiary of a body corporate that
is a subsidiary of the society (including a body corporate
that is a subsidiary of the society by another application of
this paragraph).
(2) The composition of a body corporate's board of directors is
15 controlled by a society if the society can appoint or remove all or a
majority of the directors by the exercise of a power exercisable with or
without the consent or concurrence of another person.
(3) For the purposes of subsection (2), a society is taken to have
power to make an appointment of directors if --
20 (a) a person cannot be appointed as director without the
exercise of such a power by the society in the person's
favour; or
(b) a person's appointment as a director follows necessarily
from the person being a director or other officer of the
25 society.
(4) Subsection (2) does not limit by implication the circumstances
in which the composition of a body corporate's board of directors is
taken to be controlled by a society.
(5) In determining whether a body corporate is a subsidiary of a
30 society --
(a) any shares held or power exercisable by the society in a
fiduciary capacity must be treated as not held or
exercisable by it; and
(b) subject to paragraphs (c) and (d), any shares held or power
35 exercisable --
(i) by any person as a nominee for the society; or
(ii) by, or by a nominee for, a subsidiary of the society
(other than a subsidiary that is concerned only in a
fiduciary capacity),
40 must be treated as held or exercisable by the society; and
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(c) any shares held or power exercisable by a person under a
debenture, or a trust deed for securing the issue of
debentures, must be disregarded; and
(d) any shares held or power exercisable by, or by a nominee
5 for, the society or a subsidiary of a society merely by way of
security given for the purposes of a transaction entered into
in the ordinary course of business in connection with
providing financial accommodation must be disregarded.
(6) If it is relevant to determine for the purposes of this Code
10 whether a body corporate is a subsidiary of another body corporate that
is not a society and subsection (1) does not apply, the first body
corporate is a subsidiary of the other body corporate if it would be such
a subsidiary under the Corporations Law.
Qualified privilege
15 12. (1) Where this Code provides that a person has qualified
privilege in respect of an act, matter or thing, the person, in respect of
that act, matter or thing --
(a) has qualified privilege in proceedings for defamation; or
(b) is not, in the absence of malice on the person's part, liable
20 to an action for defamation at the suit of a person.
(2) In subsection (1) --
''malice'' includes ill-will to the person concerned or any other
improper motive.
(3) Neither this section nor a provision of this Code that provides
25 as mentioned in subsection (1) limits or 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.
Carrying on business: otherwise than for profit
13. A reference in this Code to a person carrying on business,
30 carrying on a business, or carrying on a business of a particular kind,
includes a reference to the person carrying on business, carrying on a
business, or carrying on a business of that kind, as the case may be --
(a) in any case, otherwise than for profit; or
(b) in the case of a body corporate, otherwise than for the profit
35 of the members or corporators of the body.
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Businesses of a particular kind
14. A reference in this Code to a business of a particular kind
includes a reference to a business of that kind that is part of, or is
carried on in conjunction with, any other business.
5 Carrying on a business: alone or together with others
15. A reference in this Code to a person carrying on a business, or a
business of a particular kind, is a reference to the person carrying on a
business, or a business of that kind, whether alone or together with any
other person or persons.
10 Interpretation generally
16. Schedule A contains miscellaneous provisions relating to the
interpretation of this Code.
Division 3 -- Operation of Friendly Societies Legislation
Extraterritorial operation of legislation
15 17. The friendly societies legislation applies --
(a) throughout Australia; and
(b) both within and outside Australia.
Division 4 -- Application and Adoption of Corporations Law
Definitions
20 18. In this Division --
''Corporations Law'' includes the Corporations Regulations.
Corporations Law applying under its own force
19. (1) The provisions of the Corporations Law (other than the
provisions of the Corporations Law mentioned in subsection (2)) are
25 excluded from applying under their own force to and with respect to
societies.
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(2) However, the following provisions of the Corporations Law are
not excluded from applying under their own force --
(a) provisions applying to, or about, the following --
(i) bodies;
5 (ii) bodies corporate;
(iii) disclosing entities;
(iv) eligible bodies;
(v) persons;
(vi) securities, including securities of a particular type;
10 (vii) securities, including securities of a particular type of
a body corporate;
(b) provisions applying to or about bodies or bodies corporate
included in the official list of a securities exchange
(including provisions of Chapter 6 applying to or about a
15 company as defined for that Chapter);
(c) Part 7.11;
(d) Part 7.12;
(e) provisions --
(i) about the interpretation of a provision mentioned in
20 paragraphs (a) to (d) (''non-excluded Corporations
Law provision''), including a provision defining a
word used in the non-excluded Corporations Law
provision; or
(ii) vesting power in the Australian Securities
25 Commission, but only to the extent that they vest
power for the purposes of a non-excluded
Corporations Law provision; or
(iii) empowering a court to make an order (including an
order curing a procedural irregularity), but only to
30 the extent that they empower the court to make an
order for the purposes of a non-excluded Corporations
Law provision; or
(iv) otherwise about the administration of a non-excluded
Corporations Law provision.
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(3) Subsection (2) does not apply provisions of the Corporations
Law that would not otherwise apply to societies or the securities of
societies.
(4) Subsections (1) to (3) have effect despite any law of this State
5 prescribed for the purposes of this subsection.
(5) The expressions used in subsection (2) (a), (b) and (e) have the
meanings given by the Corporations Law.
(6) Subsections (1) to (3) are not intended to affect the operation,
as intended under the Corporations Law, of a provision of the
10 Corporations Law expressly excluding a provision of the Corporations
Law from having application to societies.
Corporations Law adopted under a regulation
20. (1) A regulation may adopt, with or without modification, a
provision of the Corporations Law for application to societies or the
15 securities of societies.
(2) However, a regulation may not adopt a provision of the
Corporations Law to the extent that the provision as adopted would be
inconsistent with a provision of the friendly societies legislation.
(3) A regulation made as permitted by this section may create an
20 offence with a maximum penalty of not more than the maximum
penalty for the equivalent offence under the Corporations Law.
Adopted provisions of Corporations Law
21. (1) This section applies if a provision of the Corporations Law
(the ''adopted provision'') is adopted for application to societies or the
25 securities of societies with or without modification, under a provision
(the ''adopting provision'') of this Code (including a regulation
permitted by section 20).
(2) Unless the adopting provision otherwise provides, definitions
and other interpretation provisions of the Corporations Law relevant to
30 the adopted provision are taken also to be adopted.
(3) ''Gazette'' and ''Minister'' in an adopted provision has the
meaning given in this Code.
(4) Neither the adopting provision nor the adopted provision gives
power to the Australian Securities Commission to administer the
35 adopted provision for this Code.
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PART 2 -- FUNCTIONS AND POWERS OF SSA
Division 1 -- General
Functions of SSA
22. The functions of the SSA under this Code are to --
5 (a) register, supervise and regulate societies; and
(b) supervise and enforce compliance by societies with this
Code and with standards; and
(c) ensure that an effective and efficient system of prudential
supervision is applied to societies; and
10 (d) protect the interests of members of societies; and
(e) facilitate or direct the transfer of engagements of, or the
conversion or merger of, societies; and
(f) otherwise undertake the administration and enforcement of
the financial institutions scheme so far as it relates to
15 societies; and
(g) provide information and statistics to AFIC relating to --
(i) societies; and
(ii) the operation, administration and enforcement of the
financial institutions scheme so far as it relates to
20 societies; and
(h) advise, and make recommendations to, AFIC; and
(i) carry out such other functions as are conferred on it by or
under the friendly societies legislation.
General powers
25 23. (1) The SSA has power to do all things necessary or convenient
to be done for, or in connection with, the performance of its functions
under this Code.
(2) Without limiting subsection (1), the SSA has such powers as
are conferred on it by or under the friendly societies legislation.
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SSA to comply with standards
24. In performing its functions, and exercising its powers, the SSA
must comply with all applicable standards.
Application of variation under standards
5 25. (1) If a standard provides that the operation of the standard in
relation to a particular society may be varied by a SSA by temporarily
changing a requirement of the standard, the SSA may temporarily
change the requirement as allowed under the standard.
(2) Subsection (1) does not limit section 23.
10 SSA to keep Minister informed
26. (1) The SSA must keep the Minister informed of --
(a) the operations of the SSA in relation to this Code; and
(b) the operation, administration and enforcement of this Code.
(2) The SSA must give the Minister such reports and information
15 in relation to those matters as the Minister requires.
Inspection of documents at public office
27. (1) The SSA must keep registers of documents and rules of
societies at its public office.
(2) A person may, on payment of the prescribed fee --
20 (a) inspect at the public office of the SSA during ordinary
business hours of the SSA at the office --
(i) the rules of a society; and
(ii) any other document of a prescribed class lodged with,
created by or otherwise held by the SSA; and
25 (b) obtain from the SSA --
(i) a certified copy of the certificate of incorporation of a
society and a certified copy of, or of part of, the rules
of a society; or
(ii) a certified copy of, or extract from, another document
30 that the person is entitled to inspect under paragraph
(a).
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Power of SSA to reject documents
28. (1) If the SSA is of opinion that a document submitted to the
SSA --
(a) contains matter contrary to law; or
5 (b) contains matter that, in a material particular, is false or
misleading in the form or context in which it is included; or
(c) because of an omission or misdescription, has not been duly
completed; or
(d) does not comply with the requirements of this Code; or
10 (e) contains an error, alteration or erasure,
the SSA may refuse to register, or may reject, the document and may
request --
(f) that the document be appropriately amended or completed
and resubmitted; or
15 (g) that a fresh document be submitted in its place; or
(h) if the document has not been duly completed, that a
supplementary document be submitted.
(2) The SSA may require a person who submits a document to the
SSA to also produce another document, or to give any information, that
20 the SSA considers necessary in order to form an opinion whether it
should refuse to register or should reject the document.
Extension or abridgment of time
29. (1) The SSA may, on receipt of written application by a society
accompanied by the prescribed fee or of its own initiative, extend or
25 abridge the time within which anything is required to be done under
this Code or the society's rules.
(2) An application under subsection (1) may be made to the SSA
even though the time sought to be extended has ended.
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Division 2 -- Specific Powers
Subdivision 1 -- Services corporations
Services corporation
30. (1) The SSA may, by Gazette notice, declare a body corporate,
5 that provides or proposes to provide financial or other services to
societies to enable them to further their objects, to be a services
corporation.
(2) Subject to this section, a society may subscribe for or otherwise
acquire shares in a services corporation.
10 (3) A society must not, without the written approval of the SSA,
apply funds in excess of the prescribed amount or an amount calculated
as prescribed, whichever is greater, in subscribing for or otherwise
acquiring shares in any one services corporation.
Maximum penalty: $25 000.
15 (4) On an application for approval under subsection (3), the SSA
may --
(a) give the approval; or
(b) refuse to give the approval.
(5) The SSA may --
20 (a) subject an approval to conditions; and
(b) at any time vary or revoke a condition imposed on an
approval.
(6) If a condition (including a prescribed condition) to which an
approval is subject has been contravened, the SSA may revoke the
25 approval.
(7) The SSA must not --
(a) refuse to give an approval; or
(b) subject an approval to conditions,
without first giving the society an opportunity to make written
30 submissions to it in relation to the matter.
(8) The SSA must not --
(a) vary a condition imposed on an approval; or
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(b) revoke an approval,
without first giving the society an opportunity to be heard or, if the
society prefers, an opportunity to make written submissions to it in
relation to the matter.
5 (9) The variation or revocation of a condition imposed on an
approval or the revocation of an approval takes effect on --
(a) the day that written notice is given to the society; or
(b) a day specified in that notice,
whichever is later.
10 (10) A society must not contravene any condition imposed on an
approval.
Maximum penalty: $25 000.
(11) The application by a society of funds in contravention of
subsection (3) is not invalid as regards a person transacting business
15 with the society unless the person --
(a) has actual knowledge of the contravention at the time when
the funds were applied; or
(b) has a connection or relationship with the society that is
such that the person should have known of the
20 contravention.
Subdivision 2 -- Enforcement powers
Obtaining information
31. (1) The SSA may, if it is reasonably necessary for the purposes
of its functions under the friendly societies legislation, by written notice
25 given to a society, or a body corporate related to a society, require the
society, or body corporate --
(a) to give to it, within a reasonable period and in a reasonable
way specified in the notice, specified information and
reports; and
30 (b) to give to it, at the reasonable times and in a reasonable
way specified in the notice, periodic reports on specific
matters; and
(c) to notify it, within the reasonable time and in a reasonable
way specified in the notice, if --
35 (i) a specified event or change of circumstances happens;
or
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(ii) the society or body corporate becomes aware that a
specified event or change of circumstances is likely to
happen.
(2) The SSA may, if it is reasonably necessary for the purposes of
5 its functions under the friendly societies legislation, by written notice
given to a services corporation, or a body corporate related to a services
corporation, require the services corporation or body corporate to give to
it, within a reasonable time and in a reasonable way specified in the
notice, specified information.
10 (3) A society, body corporate or services corporation that, without
reasonable excuse, fails to comply with a requirement under
subsection (1) or (2) to the extent that it is capable of doing so commits
an offence.
Maximum penalty: $25 000.
15 (4) It is not a reasonable excuse for a society, or body corporate or
services corporation to fail to comply with a requirement under
subsection (1) or (2) that complying with the requirement might tend to
incriminate the society, body corporate or services corporation.
(5) The fact that information or a report or notification was given
20 by a society, body corporate or services corporation under subsection (1)
or (2) is not admissible in evidence against the society, body corporate
or services corporation in a criminal proceeding (other than a
proceeding in relation to the falsity of the information, report or
notification) if --
25 (a) the society, body corporate or services corporation, before
giving the information, report or notification (the ''relevant
action'') claimed that the relevant action might tend to
incriminate the society, body corporate or services
corporation; and
30 (b) the relevant action might in fact tend to incriminate the
society, body corporate or services corporation.
Obtaining evidence
32. (1) The SSA may, if it is reasonably necessary for the purposes
of the friendly societies legislation, by written notice given to a person,
35 require the person --
(a) to attend before an employee of the SSA authorized for the
purpose, at a reasonable time and place specified in the
notice, and then and there answer questions; and
(b) to produce to an employee of the SSA authorized for the
40 purpose, at a reasonable time and place specified in the
notice, documents in the custody or under the control of the
person.
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(2) An employee before whom a person attends under subsection
(1) (a) may require answers to be verified or given on oath or
affirmation, and either orally or in writing, and for that purpose the
employee may administer an oath or affirmation.
5 (3) An employee to whom documents are produced under
subsection (1) --
(a) may keep the documents for 60 days or, if a prosecution for
an offence against the friendly societies legislation of which
the document may afford evidence is instituted within that
10 period, until the completion of the proceeding for the offence
and of any appeal in relation to the proceeding; and
(b) while the employee has possession of the document, may
take extracts from and make copies of the document, but
must allow the document to be inspected at any reasonable
15 time by a person who would be entitled to inspect it if it
were not in the employee's possession.
(4) The regulations must prescribe scales of allowances and
expenses to be allowed to persons required to attend under this section.
(5) The SSA may authorize an employee for the purpose of
20 subsection (1) (a) only if the person has, in the SSA's opinion, the
appropriate expertise for the purpose (whether because of training or
otherwise).
(6) A person who, without reasonable excuse, fails to comply with
a requirement under subsection (1) to the extent that the person is
25 capable of doing so commits an offence.
Maximum penalty: $25 000.
(7) It is not a reasonable excuse for a person to fail to comply with
a requirement under subsection (1) that complying with the
requirement might tend to incriminate the person.
30 (8) An answer given by a person under subsection (1) is not
admissible against the person in a criminal proceeding (other than a
proceeding in relation to the falsity of the answer) if --
(a) the person, before giving the answer, claimed that giving
the answer might tend to incriminate the person; and
35 (b) the answer might in fact tend to incriminate the person.
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(9) The fact that a document was produced by a person under
subsection (1) is not admissible in evidence against the person in a
criminal proceeding (other than a proceeding in relation to the falsity of
the document) if --
5 (a) the person, before producing the document, claimed that
producing the document might tend to incriminate the
person; and
(b) producing the document might in fact tend to incriminate
the person.
10 Inspectors
33. (1) The SSA may authorize a person, or a class of persons, to
exercise all or any of the powers conferred by this Code on an inspector.
(2) The SSA may cause an identity card to be issued to an
inspector.
15 (3) The identity card must --
(a) contain a recent photograph of the inspector; and
(b) be in a form approved by the SSA.
(4) A person who ceases to be an inspector must, as soon as
practicable, return his or her identity card to the SSA.
20 Maximum penalty: $5 000.
Inspector to produce identity card
34. An inspector is not entitled to exercise powers under this Division
in relation to another person unless the inspector first produces the
inspector's identity card for inspection by the person.
25 Entry and search -- monitoring compliance
35. (1) An inspector may, for the purpose of finding out whether
the requirements of this Code are being complied with --
(a) enter any place; and
(b) exercise the powers set out in section 37.
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(2) An inspector must not enter a place, or exercise a power under
subsection (1), unless --
(a) the place is premises occupied by a society or services
corporation, or a body corporate related to a society or
5 services corporation and the entry is made when the
premises are open for conduct of business or otherwise open
for entry; or
(b) the place is premises occupied by a banker or liquidator of a
society, or a body corporate related to a society, and the
10 entry is made when the premises are open for conduct of
business or otherwise open for entry; or
(c) the place is premises that are not occupied for residential
purposes, the inspector believes on reasonable grounds that
accounting records or other prescribed documents of, or any
15 auditor's or actuary's working papers relating to, a society,
or a body corporate related to a society, are kept or are to
be found on the premises and the entry is made when the
premises are open for conduct of business or otherwise open
for entry; or
20 (d) the occupier of the place consents to the entry or exercise of
the power; or
(e) a warrant under section 38 authorizes the entry or exercise
of the power.
Entry and search -- evidence of offences
25 36. (1) Subject to subsection (3), if an inspector has reasonable
grounds for suspecting that there is in a place a particular thing (''the
evidence'') that may afford evidence of the commission of an offence
against this Code, the inspector may --
(a) enter the place; and
30 (b) exercise the powers set out in section 37.
(2) If an inspector enters the place and finds the evidence, the
following provisions have effect --
(a) the inspector may seize the evidence;
(b) the inspector may keep the evidence for 60 days or, if a
35 prosecution for an offence against this Code in the
commission of which the evidence may have been used or
otherwise involved is instituted within that period, until the
completion of the proceeding for the offence and of any
appeal in relation to the proceeding;
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Friendly Societies (Western Australia)
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(c) if the evidence is a document, while the inspector has
possession of the document, the inspector may take extracts
from and make copies of the document, but must allow the
document to be inspected at any reasonable time by a
5 person who would be entitled to inspect it if it were not in
the inspector's possession.
(3) An inspector must not enter the place or exercise a power
under subsection (1) unless --
(a) the occupier of the place consents to the entry or exercise of
10 the power; or
(b) a warrant under section 39 that was issued in relation to
the evidence authorizes the entry or exercise of the power.
(4) If, while searching the place under subsection (1) under a
warrant under section 39 --
15 (a) an inspector finds a thing that the inspector believes, on
reasonable grounds, to be --
(i) a thing (other than the evidence) that will afford
evidence of the commission of the offence mentioned
in subsection (1); or
20 (ii) a thing that will afford evidence of the commission of
another offence against this Code; and
(b) the inspector believes, on reasonable grounds, that it is
necessary to seize the thing to prevent --
(i) its concealment, loss or destruction; or
25 (ii) its use in committing, continuing or repeating the
offence mentioned in subsection (1) or another
offence, as the case may be,
subsection (2) applies to the thing as if it were the evidence.
(5) An inspector who seizes or damages anything under this
30 section must give written notice of particulars of the thing or damage.
(6) The notice must be given to --
(a) if anything is seized, the person from whom the thing was
seized; or
(b) if damage is caused to anything, the person who appears to
35 the inspector to be the owner.
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General powers of inspector in relation to places
37. (1) The powers an inspector may exercise under section
35 (1) (b) or 36 (1) (b) in relation to a place are as follows --
(a) to search any part of the place;
5 (b) to inspect, examine or photograph anything in the place;
(c) to take extracts from, and make copies of, any documents in
the place;
(d) to take into the place such equipment and materials as the
inspector requires for the purpose of exercising any powers
10 in relation to the place;
(e) to require the occupier or any person in the place to give to
the inspector reasonable assistance in relation to the
exercise of an inspector's powers mentioned in paragraphs
(a) to (d).
15 (2) A person must not, without reasonable excuse, fail to comply
with a requirement under subsection (1) (e).
Maximum penalty: $5 000.
(3) It is not a reasonable excuse for a person to fail to comply with
a requirement under subsection (1) (e) on the ground of the privilege
20 against self-incrimination.
(4) If, under a requirement under subsection (1) (e), a person is
required to answer a question or produce a document, the contents of
the answer, or the fact of production of the document, is not admissible
in evidence against the person in a criminal proceeding (other than a
25 proceeding in relation to the falsity of the answer or document).
(5) For the purposes of the application of subsection (4) to the
production of a document, the contents of the document are to be
disregarded.
Monitoring warrants
30 38. (1) An inspector may apply to a magistrate for a warrant under
this section in relation to a particular place.
(2) Subject to subsection (3), the magistrate may issue the warrant
if the magistrate is satisfied, by information on oath, that it is
reasonably necessary that the inspector should have access to the place
35 for the purpose of finding out whether the requirements of this Code
are being complied with.
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(3) If the magistrate requires further information concerning the
grounds on which the issue of the warrant is being sought, the
magistrate must not issue the warrant unless the inspector or another
person has given the information to the magistrate in the form (either
5 orally or by affidavit) that the magistrate requires.
(4) The warrant must --
(a) authorize the inspector, with such assistance and by such
force as is necessary and reasonable --
(i) to enter the place; and
10 (ii) to exercise the powers set out in section 37; and
(b) state whether the entry is authorized to be made at any
time of the day or night or during specified hours of the day
or night; and
(c) specify the day (not more than 6 months after the issue of
15 the warrant) on which the warrant ceases to have effect;
and
(d) state the purpose for which the warrant is issued.
Offence related warrants
39. (1) An inspector may apply to a magistrate for a warrant under
20 this section in relation to a particular place.
(2) Subject to subsection (3), the magistrate may issue the warrant
if the magistrate is satisfied, by information on oath, that there are
reasonable grounds for suspecting that there is, or there may be within
the next 72 hours, in the place a particular thing (''the evidence'') that
25 may afford evidence of the commission of an offence against this Code.
(3) If the magistrate requires further information concerning the
grounds on which the issue of the warrant is being sought, the
magistrate must not issue the warrant unless the inspector or another
person has given the information to the magistrate in the form (either
30 orally or by affidavit) that the magistrate requires.
(4) The warrant must --
(a) authorize the inspector, with such assistance and by such
force as is necessary and reasonable --
(i) to enter the place; and
35 (ii) to exercise the powers set out in section 37; and
(iii) to seize the evidence; and
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(b) state whether the entry is authorized to be made at any
time of the day or night or during specified hours of the day
or night; and
(c) specify the day (not more than 7 days after the issue of the
5 warrant) on which the warrant ceases to have effect; and
(d) state the purposes for which the warrant is issued.
Offence related warrant may be granted by telephone
40. (1) If, because of urgent circumstances, an inspector considers
it necessary to do so, the inspector may, under this section, apply by
10 telephone for a warrant under section 39.
(2) Before applying for the warrant, the inspector must prepare
information of the kind mentioned in section 39 (2) that sets out the
grounds on which the issue of the warrant is sought.
(3) If it is necessary to do so, the inspector may apply for the
15 warrant before the information has been sworn.
(4) If the magistrate is satisfied --
(a) after having considered the terms of the information; and
(b) after having received such further information (if any) as
the magistrate requires concerning the grounds on which
20 the issue of the warrant is being sought,
that there are reasonable grounds for issuing the warrant, the
magistrate may, under section 39, complete and sign such a warrant as
the magistrate would issue under that section if the application had
been made under that section.
25 (5) If the magistrate completes and signs the warrant --
(a) the magistrate must --
(i) tell the inspector what the terms of the warrant are;
and
(ii) tell the inspector the date on which and the time at
30 which the warrant was signed; and
(iii) record on the warrant the reasons for granting the
warrant; and
(b) the inspector must --
(i) complete a form of warrant in the same terms as the
35 warrant completed and signed by the magistrate; and
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(ii) write on the form of warrant the name of the
magistrate and the date on which and the time at
which the magistrate signed the warrant.
(6) The inspector must also, not later than the day after the day of
5 expiry or execution of the warrant (whichever is the earlier), send to the
magistrate --
(a) the form of warrant completed by the inspector; and
(b) the information mentioned in subsection (2), which must
have been duly sworn.
10 (7) When the magistrate receives the documents mentioned in
subsection (6), the magistrate must --
(a) attach them to the warrant that the magistrate completed
and signed; and
(b) deal with them in the way in which the magistrate would
15 have dealt with the information if the application for the
warrant had been made under section 39.
(8) A form of warrant duly completed by the inspector under
subsection (5) is authority for any entry, search, seizure or other
exercise of a power that the warrant signed by the magistrate
20 authorizes.
(9) If --
(a) it is material for a court to be satisfied that an entry,
search, seizure or other exercise of power was authorized by
this section; and
25 (b) the warrant completed and signed by the magistrate
authorizing the exercise of power is not produced in
evidence,
the court must assume, unless the contrary is proved, that the exercise
of power was not authorized by such a warrant.
30 Obstruction of inspectors
41. A person must not, without reasonable excuse, assault, obstruct,
hinder or resist an inspector in the exercise of a power under this Code.
Maximum penalty: $50 000 or imprisonment for 7 years, or both.
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False or misleading statements
42. (1) In this section --
''relevant person'' means a person exercising powers under this
Code, and includes an inspector.
5 (2) A person must not --
(a) make a statement to the SSA or a relevant person that the
person knows is false or misleading in a material
particular; or
(b) omit from a statement made to the SSA or a relevant
10 person anything without which the statement is, to the
person's knowledge, misleading in a material particular; or
(c) give to the SSA or a relevant person a document containing
information that the person knows is false, misleading or
incomplete in a material particular without, at the same
15 time --
(i) indicating that the document is false, misleading or
incomplete and the respect in which it is false,
misleading or incomplete; and
(ii) giving correct information if the person has, or can
20 reasonably obtain, the correct information.
Maximum penalty: $100 000 or imprisonment for 15 years,
or both.
Subdivision 3 -- Special meeting and inquiry
Special meeting and inquiry
25 43. (1) The SSA, on the written application of a majority of the
directors, or not less than 10% of the members of a society or not less
than 10% of the members of a benefit fund of a society (as the case
requires) or on its own initiative --
(a) may call a special meeting of the society or of the members
30 of the benefit fund; or
(b) may hold an inquiry into affairs (including the working and
financial conditions) of the society or the benefit fund.
(2) The SSA, on its own initiative, may hold an inquiry into affairs
(including the working and financial conditions) of --
35 (a) a body corporate related to a society; or
(b) a services corporation.
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(3) An application under subsection (1) must be supported by such
evidence as the SSA directs for the purpose of showing that the
applicants have good reason for requiring the meeting or inquiry and
that the application is made without malicious motive.
5 (4) Notice of the application must be given to the society if the
SSA directs.
(5) Security for the expenses of a meeting or inquiry must be
given --
(a) if the meeting is called or inquiry is held on an application
10 under subsection (1), by the applicants; or
(b) in any other case, by such persons and in such way as the
SSA directs.
(6) The SSA may --
(a) direct the time and place the meeting or inquiry is to be
15 held; and
(b) direct what matters are to be discussed or determined; and
(c) despite the rules of the society, give notice to members of
the holding of the meeting or inquiry as it considers
appropriate.
20 (7) The SSA may, by written notice, direct the directors and such
other persons as it requires to attend the meeting or inquiry.
(8) A person to whom a direction is given under subsection (7)
must not, without reasonable excuse, fail to comply with the direction.
Maximum penalty: $100 000 or imprisonment for 15 years,
25 or both.
(9) A meeting held under this section has all the powers of a
meeting called under the rules of a society and has power to appoint a
person to preside at the meeting, despite any rule of the society to the
contrary.
30 (10) The SSA, or any person nominated by it, may attend and
address a meeting held under this section.
(11) All expenses of and incidental to the meeting or inquiry may
be defrayed --
(a) if the meeting is called or inquiry is held under
35 subsection (1) --
(i) by the applicants, or any officer or member, or former
officer or member of the society; or
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(ii) by the society out of the management fund of the
society or, with the prior written approval of the SSA,
out of a benefit fund of the society,
in such proportions as may be agreed between the SSA and
5 those persons; or
(b) if the inquiry is held under subsection (2) --
(i) in the case of a related body corporate, out of the
funds of the society to which the body corporate is
related; or
10 (ii) in the case of a services corporation, out of the funds
of the services corporation or, if the society has shares
in the services corporation, out of the management
fund of the society,
in such proportions as the SSA directs,
15 and may be recovered as a debt in a court having jurisdiction for the
recovery of debts up to the amount concerned.
(12) In default of agreement under subsection (11) (a), the
expenses must be defrayed by such persons, and in such proportions, as
the Court, on the application of the SSA, directs.
20 Subdivision 4 -- Special power of intervention
Intervention by SSA
44. (1) If the SSA is of the opinion that --
(a) a society has contravened the friendly societies legislation
and, after being given written notice of the contravention by
25 the SSA, has allowed the contravention to continue or has
again contravened the legislation; or
(b) the management fund of a society has an accumulated
deficit; or
(c) the affairs of a society or a fund of a society are being
30 managed or conducted in an improper or financially
unsound way,
the SSA may, by written notice given to the society, place it under
direction.
(2) The SSA may, by written notice given to the society, revoke the
35 notice.
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(3) While the society is under direction, the SSA may do all things
that it considers necessary to ensure that the principal objects of the
friendly societies scheme for friendly societies established by the
friendly societies legislation are achieved in relation to the society.
5 (4) Without limiting subsection (3), the SSA may,
(a) order an audit of the affairs of the society or a fund of the
society by an auditor chosen by the SSA at the expense of
the society; or
(b) order an actuarial investigation of the affairs of the society
10 or a fund of the society by an actuary chosen by the SSA at
the expense of the society; or
(c) direct the society to change any practices that in the SSA's
opinion are undesirable or unsound; or
(d) direct the society to cease or limit the raising of funds or
15 the exercise of other powers; or
(e) remove a director, or all the directors, of the society from
office and appoint another director or other directors; or
(f) remove any auditor of the society from office and appoint
another auditor; or
20 (g) remove the actuary of the society from office and appoint
another actuary; or
(h) give any other directions as to the way in which the affairs
of the society are to be conducted or not conducted.
(5) If the society --
25 (a) fails, without reasonable excuse, to comply with a direction
given or requirement made under this section to the extent
that the society is capable of doing so; or
(b) without reasonable excuse, obstructs, hinders or resists the
exercise of the SSA's powers under this section,
30 the society and any officer of the society who is in default each commit
an offence.
Maximum penalty: $100 000 or imprisonment for 15 years,
or both.
(6) A director, auditor or actuary appointed under this section
35 holds office for such term as the SSA directs.
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Subdivision 5 -- Power to suspend operations of society
Power to suspend operations
45. (1) If the SSA considers that it is necessary to do so --
(a) in the interests of members, or persons who may become
5 members, of a society; or
(b) because a society has failed to comply with a standard,
the SSA may, by written notice given to the society, direct the society
not to do any of the following --
(c) borrow any amount;
10 (d) accept any new member;
(e) without the approval of the SSA, accept any contribution or
pay to a member any benefit or otherwise dispose of or deal
with the assets of the society or a fund of the society;
(f) accept any payment on account of share capital except calls
15 that fell due before the notice was given;
(g) repay any amount paid on shares;
(h) repay any money on loan;
(i) pay or transfer an amount to any person, or create an
obligation to do so.
20 (2) A notice under subsection (1) continues in force until it expires,
or is withdrawn by the SSA.
(3) The SSA may, by a further written notice given to the
society --
(a) extend the period for which a notice under subsection (1) is
25 to have force; or
(b) amend the terms of the notice; or
(c) withdraw the notice.
(4) If a society fails to comply with a notice under this section, the
society and any officer of the society who is in default each commit an
30 offence.
Maximum penalty: $100 000 or imprisonment for 15 years,
or both.
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(5) Subsection (4) does not apply if the failure to comply happens
with the written permission of the SSA.
Subdivision 6 -- Administrators
Appointment of administrator
5 46. (1) The SSA may, by written notice, appoint an administrator
to conduct the affairs of a society and may, by written notice, revoke
the appointment.
(2) A notice of appointment must specify --
(a) the date of appointment; and
10 (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
SSA.
15 (4) The SSA must not appoint an administrator unless --
(a) the SSA is of the opinion that --
(i) the society has contravened the friendly societies
legislation or the society's rules and, after being given
written notice of the contravention by the SSA, has
20 allowed the contravention to continue or has again
contravened the legislation or rules; or
(ii) the management fund of the society has an
accumulated deficit; or
(iii) the affairs of the society or a fund of the society are
25 being managed or conducted in an improper or
financially unsound way; or
(b) after making such inquiries in relation to the society as the
SSA considers appropriate, the SSA is satisfied that it is in
the interest of members or creditors that the society's
30 affairs be conducted by an administrator; or
(c) the SSA has certified that any of the events mentioned in
section 402 (1) (a), (b), (c) or (g) has happened.
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(5) On the appointment of an administrator of a society --
(a) the directors of the society cease to hold office; and
(b) all contracts of employment with, or for provision of
administrative or secretarial services to, the society are
5 terminated; and
(c) the administrator may terminate any contract for provision
of other services to the society.
(6) An administrator of a society has the powers and functions of
the board of the society, including the board's powers of delegation.
10 (7) A director of a society must not be appointed or elected while
the administrator is in office except in the circumstances mentioned in
subsection (11).
(8) An administrator holds office until the administrator's
appointment is revoked.
15 (9) Immediately on the revocation of an administrator's
appointment, the administrator must prepare and submit a report to
the SSA showing how the administration was carried out, and for that
purpose an administrator has access to the society's records and
documents.
20 (10) On providing the report and accounting fully in relation to the
administration of the society to the satisfaction of the SSA, the
administrator is released from any further duty to account in relation to
the administration of the society other than on account of fraud,
dishonesty, negligence or wilful failure to comply with the friendly
25 societies legislation.
(11) Before revoking an administrator's appointment, the SSA
must --
(a) appoint another administrator; or
(b) appoint a liquidator; or
30 (c) ensure that directors have been elected under the society's
rules at a meeting called by the administrator under the
rules; or
(d) appoint directors of the society.
(12) Directors elected or appointed under subsection (11) --
35 (a) take office on the revocation of the administrator's
appointment; and
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(b) in the case of directors appointed under subsection (11) (d),
hold office, subject to section 47, until the society's next
annual general meeting.
(13) The expenses of an administrator in conducting a society's
5 affairs are payable --
(a) from the management fund of the society; or
(b) from a benefit fund of the society in accordance with the
prior written approval of the SSA; or
(c) partly from the management fund and partly from a benefit
10 fund in accordance with the prior written approval of the
SSA.
(14) The expenses of conducting a society's affairs include --
(a) if the administrator is not an employee of the SSA,
remuneration of the administrator at a rate approved by
15 the SSA; or
(b) if the administrator is an employee of the SSA, the amount
that the SSA certifies should be paid to it as repayment of
the administrator's remuneration.
(15) An amount certified under subsection (14) (b) is a debt due to
20 the SSA and may be sued for and recovered in a court having
jurisdiction for the recovery of debts up to the amount concerned.
(16) An administrator has, in relation to the expenses specified in
subsection (13), the same priority on the winding-up of a society as the
liquidator of the society has.
25 (17) If a society incurs any loss because of any fraud, dishonesty,
negligence or wilful failure to comply with the friendly societies
legislation or the society's rules by an administrator, the administrator
is personally liable for the loss.
(18) An administrator is not liable for any loss that is not a loss to
30 which subsection (17) applies but must account for the loss in a report
given under this section.
Additional powers of SSA
47. (1) If the SSA appoints directors of a society under
section 46 (11) (d), the SSA may, by written notice given to the society,
35 specify --
(a) a time during which this section is to apply in relation to
the society; and
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(b) the terms and conditions on which all or any of the
directors hold office; and
(c) the rules that are to be the society's rules.
(2) While this section applies to a society, the SSA may --
5 (a) from time to time remove and appoint directors; and
(b) from time to time vary, revoke or specify new terms and
conditions in place of all or any of the terms and conditions
specified under subsection (1); and
(c) amend all or any of the rules specified under subsection (1).
10 (3) The SSA may, by written notice given to the society, extend the
time for which this section is to apply in relation to a society.
(4) A rule specified by the SSA under this section as a rule of the
society --
(a) is not to be amended or revoked except in the way set out
15 in this section; and
(b) if it is inconsistent with any other rule of the society,
prevails over the other rule, and the other rule is to the
extent of the inconsistency invalid; and
(c) has the same evidentiary value as is by this Code accorded
20 to the society's rules and to copies of them.
Stay of proceedings
48. (1) If the SSA appoints an administrator to conduct a society's
affairs, a person must not begin or continue any proceeding in a court
against the society until the administrator's appointment is revoked
25 except with the leave of the Court and, if the Court grants leave, in
accordance with any terms and conditions that the Court imposes.
(2) A person intending to apply for leave of the Court under
subsection (1) must give to the SSA not less than 10 days' notice of
intention to apply.
30 (3) On the hearing of an application under subsection (1), the SSA
may be represented and may oppose the granting of the application.
Administrator to report to SSA
49. On the receipt of a request from the SSA, the administrator of a
society must, without delay, prepare and give to the SSA a report
35 showing how the administration is being carried out.
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Subdivision 7 -- Levies
Supervision Fund
50. The SSA must pay into the Supervision Fund established under
section 94 of the Financial Institutions Code all amounts received as
5 supervision levy under this Division.
Supervision levy
51. (1) The SSA may determine that an amount is to be paid to it
by societies as a supervision levy.
(2) The amount of the levy may be fixed by the SSA as --
10 (a) a specified amount; or
(b) a specified percentage of an amount to be determined, on a
specified day, by reference to specified factors relating to
societies (including, for example, factors such as paid-up
capital, reserves, obligations and debts and total assets
15 including assets of each fund of the society); or
(c) both a specified amount and such a specified percentage.
(3) If the levy is fixed, wholly or partly, as mentioned in
subsection (2) (b), the SSA may include in the determination directions
as to the way in which the levy is to be determined.
20 (4) The SSA may --
(a) fix the amount of the levy differently for different societies;
and
(b) determine that the levy is not payable by specified societies.
(5) The SSA may, in the determination, require the levy to be paid
25 in one amount by a specified time or permit the levy to be paid by
specified instalments.
(6) If the SSA permits the levy to be paid by instalments, it may,
in the determination, allow a discount for payment in one amount by a
specified time or require payment of an additional amount or
30 percentage, by way of interest, in the instalments.
(7) The SSA may, in the determination, require the payment of
amounts, by way of late payment charge, interest or both, in relation to
amounts of levy that are not paid as required by the determination.
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Friendly Societies (Western Australia)
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(8) The SSA may include in the determination directions as to the
way in which amounts of late payment charge and interest are to be
determined.
(9) Amounts of levy are, when they are due and payable, debts due
5 and payable by the society concerned to the SSA, and may be sued for
and recovered in a court having jurisdiction for the recovery of debts up
to the amount concerned.
(10) The SSA may, on the application of a society, vary --
(a) an amount of levy payable by the society; or
10 (b) the time within which an amount of levy is payable by the
society.
(11) An amount paid by a society as levy is treated as an expense
in the accounts of the society.
(12) In subsections (9), (10) and (11) --
15 ''levy'' includes late payment charge and interest in relation to
levy.
Consultation
52. In determining the amount to be paid as supervision levy under
section 51, the SSA may, where it is appropriate and practicable to do
20 so, consult with industry bodies and societies.
Failure to make payment an offence
53. If a society defaults in making any payment required to be made
under section 51, the society and any officer of the society who is in
default each commit an offence.
25 Maximum penalty: $25 000.
Subdivision 8 -- Control of advertising
Restriction on initial advertisements
54. (1) A person who does not have the written permission of the
SSA to do so, must not issue, or cause to be issued, an advertisement
30 relating to --
(a) a proposed society or proposed benefit fund of a society or
proposed society; or
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(b) a body corporate that proposes to become a foreign society.
Maximum penalty: $100 000 or imprisonment for 15 years,
or both.
(2) The permission granted by the SSA under subsection (1)
5 applies for the purposes of this section only and must not be construed
as permission in respect of any other matter or thing for which
permission under this Code is required.
Power to control advertising
55. (1) The SSA may, by written notice given to a society or foreign
10 society, direct it --
(a) not to issue an advertisement; or
(b) not to issue an advertisement of a specified kind; or
(c) not to issue an advertisement that is substantially in the
same form as an advertisement that has been issued before;
15 or
(d) to include in an advertisement of a specified kind, or in an
invitation to invest in the society, information relating to
the society or foreign society that is required by the SSA to
be included.
20 (2) Directions under subsection (1) may be varied or revoked by
further written notice given to the society, or foreign society, by the
SSA.
(3) A society or foreign society that fails to comply with a direction
under this section commits an offence.
25 Maximum penalty: $75 000.
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PART 3 -- SOCIETIES
Division 1 -- Objects
Primary objects
56. For the purposes of this Code, primary objects, in relation to a
5 society, are such of the following as are specified in the rules of the
society as objects of the society --
(a) to provide health and welfare benefits, services and
facilities for members or their dependants, including but
not limited to hospital, medical, dental, pharmaceutical,
10 optical, physiotherapy and speech therapy benefits, services
and facilities;
(b) to provide benefits, services and facilities for the relief and
maintenance of members or their dependants in the case of
birth, death, sickness, disability, accident, retirement, old
15 age and unemployment;
(c) to provide benefits, services and facilities for the education
of members or their dependants;
(d) to provide financial and investment benefits, services and
facilities for members or their dependants including, but
20 not limited to, benefits, services and facilities relating to
annuities, life insurance and superannuation;
(e) to sell or supply medical requisites and therapeutic goods
and dispense or sell medicines to members of the public.
Objects of society must include primary objects
25 57. The objects of a society must include one or more of the objects
referred to in section 56.
Dominant activities
58. The dominant activities of a society must be within the scope of
the primary objects of the society.
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Division 2 -- Formation and Registration
Formation of societies
59. (1) A body proposed to be a society may be formed by any 25 or
more adults.
5 (2) A proposed society may be formed only if there has been a
meeting for the purpose of forming the society at which there were
present 25 or more adults.
(3) At the formation meeting, there must be presented --
(a) a written statement showing --
10 (i) the primary objects and other objects of the society;
and
(ii) the reasons for believing that an application for
registration of the society should be granted; and
(iii) the reasons for believing that, if registered, the
15 society will be able to carry out its objects
successfully; and
(b) a copy of the proposed rules of the society.
(4) If, at the formation meeting or any subsequent or adjourned
meeting, 25 or more adults, after considering the statement and the
20 rules, approve the rules (with or without amendment), and sign an
application for membership and shares (if any), they may proceed to
elect the first directors of the society under the rules as so approved.
(5) An application for shares in a proposed society, made before
the registration of the society, may not be withdrawn, and a person who
25 makes such an application is, on the registration of the society, liable to
pay the society --
(a) the value of the shares for which the person applied; or
(b) the value of the minimum number of shares for which a
member is entitled to subscribe,
30 whichever is greater.
(6) The expenses of, and incidental to, the formation of the society
may be paid out of the capital or income of the society.
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(7) A person must not, before a society is registered --
(a) issue an invitation to acquire an interest in the proposed
society or to contribute to a benefit fund of the proposed
society; or
5 (b) take an amount in consideration of the allotment of a share,
or the acquisition of an interest in, the proposed society or
take a contribution to a benefit fund of the proposed society.
(8) A person who contravenes subsection (7) commits an offence
and is liable on conviction to a maximum penalty of $100 000 or
10 imprisonment for 15 years, or both.
Registration
60. (1) A proposed society formed under this Part may apply to the
SSA, in accordance with the regulations, to be registered under this
Code as a society.
15 (2) An application for registration must --
(a) be made within 2 months after the meeting at which the
first directors of the society were elected; and
(b) be accompanied by --
(i) a statutory declaration by the person presiding at
20 that meeting and a person elected as a director at
that meeting stating that the requirements of section
59 have been complied with; and
(ii) a copy of the statement presented to the meeting,
signed by the person presiding and a director; and
25 (iii) 2 copies of the proposed rules of the society, certified
by the person presiding and a director to be the rules
approved at the meeting; and
(iv) a list containing the full name, date and place of
birth, residential address and business occupation of
30 each director; and
(v) a list containing the full name, address and
occupation of each of 25 or more adults who attended
the meeting and applied for membership; and
(vi) written estimates of all income and expenditure and
35 capital flows over each of the first 3 years of
operation of the society; and
(vii) the prescribed fee; and
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(c) be accompanied by such evidence as the SSA requires --
(i) that the society is eligible for registration; and
(ii) that the society, if registered, will be able to comply
with the friendly societies legislation and all
5 applicable standards; and
(iii) that the dominant activities of the society, if
registered, will be within the scope of at least one of
the primary objects specified in section 56;
(iv) that the society, if registered, will be able to carry out
10 its objects successfully; and
(v) that the society, if registered, will operate at least one
benefit fund.
(3) The SSA may, for the purposes of this section, accept a
statutory declaration as sufficient evidence of matters mentioned in the
15 declaration.
(4) If the SSA is satisfied that the society is eligible for
registration, the SSA must register the society and its proposed rules.
(5) A society is eligible for registration only if --
(a) the society's application for registration complies with this
20 Code; and
(b) the proposed rules of the society comply with this Code and
the standards; and
(c) there are reasonable grounds for believing that the society
will, within a reasonable time after registration, if
25 registered --
(i) be able to comply with the friendly societies
legislation and all applicable standards; and
(ii) have, as its dominant activities, activities that are
within the scope of the primary objects of the society;
30 and
(iii) be able to carry out its objects successfully; and
(iv) unless exempted by the SSA, operate at least one
benefit fund; and
(d) there is no good reason why the society and its rules should
35 not be registered.
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(6) The SSA may, by written notice given to the society, exempt a
society from complying with the requirement to operate at least one
benefit fund.
Certificate of incorporation
5 61. (1) On registering a society, the SSA must issue to the society a
certificate of incorporation.
(2) A certificate of incorporation issued to a society is conclusive
evidence that all requirements of this Code in relation to registration
and matters precedent or incidental to registration have been complied
10 with.
Effect of incorporation
62. On the issue of a certificate of incorporation to a society, the
society is a body corporate with perpetual succession and --
(a) has the legal capacity of a natural person; and
15 (b) may acquire, hold and dispose of real and personal
property; and
(c) has a common seal; and
(d) may sue and be sued in its corporate name.
Powers of societies
20 63. (1) Without limiting section 62, but subject to the friendly
societies legislation and the society's rules, a society may --
(a) acquire shares in an association by purchase or otherwise;
(b) hold a subsidiary but only if approved by the SSA;
(c) obtain registration as a foreign society under the friendly
25 societies legislation of another participating State;
(d) carry on a pharmacy practice and employ a pharmacist who
is registered under the pharmacy law of this State;
(e) do anything else that it is authorized to do by the friendly
societies legislation or the society's rules.
30 (2) The powers of a subsidiary formed or acquired by a society are
not limited by the society's objects or limitations on the society's
powers.
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(3) Except as permitted by the standards, a society must not carry
on business outside Australia.
(4) In this section --
''carry on business'' means --
5 (a) establish or use an office for receiving amounts in
consideration of the acquisition of an interest in a
society or contributions to a benefit fund of a society;
or
(b) advertise in relation to raising share capital or invite
10 contributions to a benefit fund of a society,
but does not include --
(c) maintain an account at a bank, building society or
credit union; or
(d) create evidence of a debt or create a charge on
15 property; or
(e) secure or collect any debts or enforce rights in respect
of such debts; or
(f) conduct an isolated transaction that is completed
within a period of 31 days, not being one of a number
20 of similar transactions repeated from time to time; or
(g) invest funds or hold property; or
(h) continue to provide benefits to, and accept
contributions from, a member who, at the time of
applying to contribute to a benefit fund, was resident
25 in Australia and has subsequently moved to a place
outside Australia; or
(i) continue to receive amounts in consideration of an
interest in a society from a member who, at the time
of acquiring the interest, was resident in Australia
30 and has subsequently moved to a place outside
Australia.
Prohibition on issuing debenture
64. A society must not issue debentures.
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Restriction on reinsurance arrangements
65. A society must not enter into a reinsurance arrangement unless
the society's actuary has given the society written advice as to the
likely consequences of the proposed arrangement.
5 Restriction on acting as trustee
66. A society must not act as a trustee or representative for the
purpose of an approved deed in relation to the issue of prescribed
interests under Part 7.12 of the Corporations Law.
Control of certain financial arrangements
10 67. Except as permitted by the standards, a society must not enter
into an arrangement --
(a) establishing rights and obligations to receive or deliver
property the value of which, or to receive or make a
payment in an amount which, or the value of which --
15 (i) depends on, or is derived from, the value or price at a
particular future time or during a particular future
period of particular property, rights or liabilities; or
(ii) depends on, or is derived by reference to, a particular
rate, index or other factor at a particular future time
20 or during a particular future period; or
(b) specified in the standards to be a prohibited financial
arrangement for the purposes of this section.
Maximum penalty: $75 000.
Control of foreign currency transactions
25 68. Except as permitted by the standards, a society must not --
(a) invest any of its assets in foreign currency; or
(b) carry out any of its activities in foreign currency.
Maximum penalty: $75 000.
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Division 3 -- Rules
Subdivision 1 -- General
Rules
69. (1) The rules of a society must set out --
5 (a) the primary objects of the society; and
(b) any other objects of the society.
(2) The rules of a society must provide for the matters specified in
the standards.
(3) Subject to subsection (4), the rules of a society may also
10 provide for any matter that is necessary, expedient or desirable for the
society's objects.
(4) If there is any inconsistency between a rule of a society and
the friendly societies legislation or a standard, the friendly societies
legislation or standard prevails and the rule is invalid to the extent of
15 the inconsistency.
Copies of rules
70. A society must give a copy of its rules, or part of its rules, to a
member or proposed member who requests it and has paid the fee (if
any) payable under the society's rules.
20 Maximum penalty: $5 000.
Society and members to be bound by rules
71. The rules of a society have effect as a contract between its
members, and between each member and the society.
Subdivision 2 -- Amendment of rules
25 Amendment of rules by special resolution
72. Subject to sections 73 and 75, the rules of a society may be
amended only if the amendment has been approved by special
resolution of the members under section 307.
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Amendment of rules by board of directors
73. (1) A society's rules may be amended by a resolution of its
board --
(a) if the amendment is authorized or required by or under any
5 Act or law or the standards; or
(b) if the SSA is satisfied that approval of the amendment by
the members of the society is not necessary and amendment
by a resolution of the board is appropriate; or
(c) to correct a patent error.
10 (2) The society must give to its members, not later than the day on
which notice is given of the next general meeting of the society, a
written notice setting out the text or a summary of an amendment of
the society's rules under this section.
Maximum penalty: $5 000.
15 (3) The notice may, with the prior written approval of the SSA, be
given by advertisement published in a newspaper circulating
generally --
(a) in the area of the State in which the society operates; and
(b) if the society operates in another State, or other States, in
20 the other State or States.
(4) The SSA may require a society that has amended its rules
under this section to obtain approval of the amendment by the members
of the society.
Registration of amendment of rules
25 74. (1) If the SSA is satisfied --
(a) that an amendment of the rules of a society would not
cause the society's dominant activities to cease to be within
its primary objects; and
(b) that the rules, as proposed to be amended, would comply
30 with the friendly societies legislation; and
(c) that there is no good reason why the amendment should not
be registered,
the SSA must register the amendment.
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(2) The amendment takes effect when it is registered.
(3) The rules of the society must be read subject to any registered
amendment.
Power of SSA to require modification of rules
5 75. (1) If, in the SSA's opinion, the rules of a society should be
amended --
(a) to comply with the friendly societies legislation; or
(b) to give effect to a standard,
the SSA may, by written notice given to the society, require it, within a
10 reasonable period specified in the notice, to amend its rules in a way
specified in the notice or otherwise in a way approved by the SSA.
(2) If the society fails to amend its rules as required by the notice,
the SSA may amend the society's rules by notation on the registered
copy of the rules.
15 (3) The SSA must immediately give written notice to a society
of --
(a) an amendment of the society's rules made under this
section; and
(b) the day on which the amendment takes effect.
20 (4) The society must give to its members, not later than the day on
which notice is given of the next general meeting of the society, a
written notice setting out the text of each amendment of the rules of
the society taking effect under this section.
Maximum penalty: $5 000.
25 (5) The notice may, with the prior written approval of the SSA, be
given by advertisement published in a newspaper circulating
generally --
(a) in the area of the State in which the society operates; and
(b) if the society operates in another State, or other States, in
30 the other State or States.
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Subdivision 3 -- Societies conducting health benefit funds
Definitions
76. In this Subdivision --
''Commonwealth Act'' means the National Health Act 1953 of
5 the Commonwealth;
''registered society'' means a society that is registered under
Part VI of the Commonwealth Act.
Health benefit fund rules
77. (1) The rules of a registered society include the terms,
10 conditions, directions and Council's rules (within the meaning of the
Commonwealth Act) that apply to the society as a registered
organisation under Part VI of the Commonwealth Act.
(2) Except as provided in section 78, this Code does not apply to
the rules referred to in subsection (1).
15 Registered society to give notice of rule changes
78. If an amendment of the rules of a registered society is made
under this Code --
(a) where, under section 78 of the Commonwealth Act, the
society receives acknowledgement of its notification of the
20 amendment, the society must, within 7 days after that
receipt give written notice to the SSA of the date on which
the amendment takes effect;
(b) where, under section 78 of the Commonwealth Act, the
Commonwealth Minister declares that the amendment is
25 not to be taken to have come into operation, the society
must, within 7 days after the declaration is made, give
written notice of the declaration to the SSA.
Division 4 -- Standards
Societies to comply with standards
30 79. A society must comply with all applicable standards.
Maximum penalty: $25 000.
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Division 5 -- Membership
Members
80. (1) A person is a member of a society if the person --
(a) signs the application for membership on the formation of
5 the society and has not ceased to be a member; or
(b) is entitled to a benefit from a benefit fund of the society; or
(c) holds a share in the society; or
(d) is admitted to membership under the society's rules and
has not ceased to be a member.
10 (2) The members of a merged society are the persons who, on the
day of the merger, are members of a society that is a party to the
merger, and any other persons who are admitted to membership under
the merged society's rules.
(3) The members of a society to which another society has
15 transferred the whole of its engagements include the persons who,
immediately before the transfer took effect, were members of the
transferor society.
(4) The members of a society to which another society has
transferred part of its engagements include the persons who,
20 immediately before the transfer took effect, were members of the
transferor society and are specified, for the purposes of this subsection,
in an agreement between the societies.
(5) A person may exercise the rights of membership of a society
only if the person has complied with any requirements for membership
25 under the society's rules, including, for example --
(a) the payment of an amount;
(b) the acquisition of shares or interests.
Members who are minors
81. (1) Subject to a society's rules, a minor may be a member of the
30 society or a benefit fund of the society.
(2) A member of a society who is a minor cannot hold office in a
society and cannot vote at a meeting of the society or of members of a
benefit fund of the society.
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(3) A person who has not reached 16 may, with the written
consent of a parent or a person who stands in the place of a parent --
(a) apply for membership of a benefit fund of a society; or
(b) take an assignment of such benefits.
5 (4) A person who has reached 16 but has not reached 18 has the
same capacity to exercise rights or powers in relation to benefits to
which he or she is entitled as a person who has reached 18.
Joint members
82. (1) Two or more persons may be joint members of a society or a
10 benefit fund of a society if the society's rules so provide.
(2) If a society or a benefit fund of a society has joint members,
the following provisions apply --
(a) in the case of a society, the register of members of the
society must indicate that a person is a joint member of the
15 society;
(b) in the case of a benefit fund of a society, the register of
members of the benefit fund must indicate that a person is
a joint member of the benefit fund;
(c) the joint members are entitled to choose the order in which
20 they are named in a register of members, but failing any
such choice the society may enter the names in the order it
considers appropriate;
(d) the joint member who is named first in a register of
members is the primary joint member;
25 (e) subject to the society's rules, but without affecting the right
of a member to obtain a copy of the balance sheet from the
society on demand, a notice or other document may be
given or sent only to the primary joint member;
(f) for the purpose of determining --
30 (i) who is qualified to vote on a resolution at a meeting
of the society or of a benefit fund of the society; and
(ii) the number or proportion of members required to give
effect to any provision of the friendly societies
legislation or the society's rules,
35 membership is taken to be solely that of the primary joint member.
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Corporate membership
83. (1) Subject to a society's rules, a body corporate may be a
member of the society or a benefit fund of the society.
(2) A body corporate that is a member of a society or a benefit
5 fund of a society may, by written notice given to the society, appoint an
individual to represent it --
(a) in the case of a body corporate that is a member of a
society, at meetings of members of the society; or
(b) in the case of a body corporate that is a member of a benefit
10 fund of a society, at meetings of the benefit fund.
(3) A person appointed under subsection (2) --
(a) is entitled --
(i) to receive notice of all meetings that the body
corporate is entitled to receive; and
15 (ii) to exercise on behalf of the body corporate the same
voting rights as the body corporate could, if it were a
natural person, exercise as a member of the society;
and
(b) is eligible to be elected as a director of the society if --
20 (i) the body corporate holds the qualifications required
for holding office as a director (other than
qualifications about age and being an individual); and
(ii) a person has not been appointed as liquidator of the
body corporate.
25 Cessation of membership
84. A person ceases to be a member of a society or a benefit fund of a
society as provided by the society's rules.
Expulsion of member
85. A member of a society may be expelled, or have the member's
30 membership rescinded, under the society's rules.
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Limitation of liability of members
86. Subject to the friendly societies legislation, a member of a society
is not liable, because of the membership, to contribute towards the
payment of the debts and liabilities of the society or the costs, charges
5 and expenses of a winding-up of the society.
Division 6 -- Name and Office
Name
87. (1) The registered name of a society is its name as specified in
the society's rules for the time being registered under this Code.
10 (2) The SSA may register a proposed society's rules, or an
amendment of rules affecting a society's name, only if AFIC has
reserved the name for the proposed society or society under Part 6A of
the AFIC Code.
(3) If the SSA registers an amendment of the rules of a society
15 changing the name of the society, the SSA may, on application by the
society accompanied by the prescribed fee, amend its certificate of
incorporation or issue a new certificate.
(4) A society must publish a change of its name as directed by the
SSA.
20 Maximum penalty: $5 000.
(5) )
(6) ) See note to section 1.
(7) )
(8) A society must not use a name other than --
25 (a) its registered name; or
(b) a name approved for its use under Part 6A of the AFIC
Code.
(9) A society does not contravene subsection (8) by using a name
in a way mentioned in section 88.
30 (10) See note to section 1.
(11) A society that contravenes subsection (8) commits an offence
and is liable on conviction to a maximum penalty of $75 000.
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Abbreviations of society's name
88. (1) A description of a society is not inadequate or incorrect
merely because the society's name is given using --
(a) the abbreviation ''Ltd.'' for the word ''Limited''; or
5 (b) the abbreviation ''Aust.'' for the word ''Australian''; or
(c) the abbreviation ''No.'' for the word ''Number''; or
(d) the symbol ''&'' for the word ''and''; or
(e) any of those words instead of the corresponding
abbreviation or symbol.
10 (2) In this section --
''name'' of a society means --
(a) its registered name; or
(b) a name approved for its use under Part 6A of the
AFIC Code.
15 Change of name does not affect identity
89. (1) A change of name of a society does not --
(a) affect the identity of the society; or
(b) affect a right or obligation of the society or of a member or
other person; or
20 (c) render defective legal proceedings by or against the society.
(2) A legal proceeding that might have been continued or started
by or against the society by its former name may be continued or
started by or against it by its new name.
Use of ''friendly society''
25 90. (1) Subject to this section --
(a) a person or body, other than a society, foreign society or
services corporation, must not carry on business, under a
name or title of which the words ''friendly society'', or any
other words, abbreviations or symbols with a similar
30 meaning, form part; and
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(b) a person or body, other than a society or foreign society,
must not hold out that its business is that of a society.
(2) A person or body may apply to the SSA for exemption from
subsection (1).
5 (3) The SSA may, by written notice given to the person or body,
grant an exemption for such time and on such conditions as the SSA
determines.
(4) The SSA may, at any time --
(a) revoke an exemption; or
10 (b) vary or revoke a condition of an exemption.
(5) A person who contravenes subsection (1) or a condition of an
exemption under subsection (3), and every director or other person
having the control and management of an incorporated or
unincorporated body contravening the subsection or condition, commits
15 an offence.
Maximum penalty: $100 000 or imprisonment for 15 years, or
both.
(6) This section does not apply to an unregistered society within
the meaning of section 91.
20 Unregistered society not to carry on business
91. (1) An unregistered society must not carry on business in this
State.
(2) An unregistered society may apply to the SSA for an exemption
from subsection (1).
25 (3) The SSA may, by written notice given to the unregistered
society, grant an exemption for such time and on such conditions as the
SSA determines.
(4) The SSA may, at any time --
(a) revoke an exemption; or
30 (b) vary or revoke a condition of an exemption.
(5) An unregistered society that contravenes subsection (1) or a
condition of an exemption under subsection (3), and every other person
having the control and management of the society contravening the
subsection, commits an offence.
35 Maximum penalty: $100 000 or imprisonment for 15 years, or
both.
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(6) In this section --
''unregistered society'' means a body registered as a friendly
society in a participating State but not registered as a
5 foreign society in this State.
Publication of name
92. (1) Except as otherwise provided in this section, a society must
set out its registered name in legible letters on every public document
(within the meaning of subsection (7)) of the society.
10 (2) A society must ensure that its registered name or a name
approved in relation to the society under Part 6A of the AFIC Code is
used on any advertisement published, or authorized to be published, by
the society.
(3) A society must ensure that its registered name and the words
15 ''Registered Office'' are displayed in a conspicuous place and in legible
letters on the outside of its registered office.
(4) A society must ensure that its registered name is displayed in
a conspicuous place and in legible letters on the outside of every other
office or place in which its business is carried on.
20 (5) A society that contravenes this section commits an offence and
is liable on conviction to a penalty of $25 000.
(6) Nothing in this section prohibits a society from using, in
addition to its registered name, a name approved in relation to the
society under Part 6A of the AFIC Code.
25 (7) For the purpose of subsection (1) --
''public document'' means --
(a) an instrument of, or purporting to be signed, issued
or published by or on behalf of, the society that --
(i) when signed, issued or published, is intended to
30 be lodged or is required by or under this Code
to be lodged; or
(ii) is signed, issued or published under or for the
purposes of this Code or any other law of the
Commonwealth or of a State; or
35 (b) an instrument of, or purporting to be signed or issued
by or on behalf of, the society that is signed or issued
in the course of, or for the purposes of, a particular
transaction or dealing; or
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(c) without limiting paragraph (a) or (b), a business
letter, statement of account, invoice, receipt, order for
goods or services, or official notice of, or purporting to
be signed or issued by or on behalf of, the society.
5 Common seal
93. (1) A society must ensure its registered name appears in legible
letters on its common seal.
(2) An officer of a society, or any person acting on its behalf, must
not use any seal, purporting to be the common seal of the society, on
10 which its registered name does not appear in legible letters.
Maximum penalty: $25 000.
Society may have duplicate common seal
94. A society may, if authorized by its rules, have a duplicate
common seal, which must be a facsimile of the common seal of the
15 society with the addition on its face of the words ''Share Seal'' or
''Document Seal'' and a document of title referring to or relating to
shares of the society sealed with that duplicate seal is taken to be
sealed with the common seal of the society.
Registered office
20 95. (1) A society must have a registered office in this State.
(2) The first registered office of a society is the address that
appears in the society's rules at the time of registration.
(3) A society must give written notice of any proposed change of
address to the SSA.
25 Maximum penalty: $5 000.
(4) At the end of the day of registration by the SSA of the new
address or at the end of such later day as the society specifies in the
notice, the new address becomes the registered office of the society.
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PART 4A -- BENEFIT FUNDS
Division 1 -- Provision of Benefits and Establishment
of Benefit Funds
Provision of benefits
5 96. (1) A society must not pay, or provide for the payment of,
amounts to which a member of the society or any other person may be,
or become, entitled because of contributions, or payments made to the
society (whether by that member or person or by another person) unless
the society --
10 (a) maintains a benefit fund for the receipt of such
contributions and payments; and
(b) pays those amounts as benefits from the benefit fund.
(2) Subsection (1) does not apply to amounts payable by a
society --
15 (a) in respect of shares in the society; or
(b) as trustee for a superannuation entity within the meaning
of the Superannuation Industry (Supervision) Act 1993 of
the Commonwealth.
Establishment of benefit fund
20 97. (1) A society may, under its rules, establish a benefit fund in
accordance with this Code and the standards.
(2) A benefit fund of the society is established when the rules of
the society providing for the benefit fund are registered by the SSA.
Approval to establish benefit fund
25 98. (1) The SSA must not register rules providing for a benefit fund
of a society unless the SSA has approved the establishment of the
benefit fund.
(2) A society that proposes to establish a benefit fund must apply
in writing to the SSA for approval to establish the benefit fund.
30 (3) An application under subsection (2) must be accompanied by a
copy of the rules the society proposes to make in relation to the
proposed benefit fund.
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(4) If the SSA receives an application under this section and is
satisfied that --
(a) the proposed rules of the society are in accordance with the
standards applicable to the proposed benefit fund; and
5 (b) the establishment of the proposed benefit fund is in
accordance with the standards; and
(c) there is no good reason why the proposed rules should not
be registered,
the SSA must, in writing given to the society, approve the application.
10 Division 2 -- Management of Benefit Funds
Assets of benefit funds
99. (1) A society must keep the assets of each benefit fund distinct
and separate from the assets of any other benefit fund and from any
other assets of the society, except as otherwise provided or permitted
15 under this Code.
(2) Except as provided in subsection (3), a society must maintain a
separate account at a bank, building society or credit union for each
benefit fund.
(3) A society may maintain a single account at a bank, building
20 society or credit union for 2 or more benefit funds if permitted to do so
by this Code or the standards.
(4) Nothing in this Code constitutes a society or a director of a
society a trustee of the assets of a benefit fund of the society.
Payments to benefit funds
25 100. A society must credit to each benefit fund, in accordance with
this Division --
(a) all contributions received by or on behalf of the society in
respect of the benefit fund; and
(b) all income from investment of assets of the benefit fund and
30 the proceeds of disposal of any such investment; and
(c) any other amounts received by or on behalf of the society in
respect of the benefit fund.
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Application of benefit fund assets
101. (1) A society must not, directly or indirectly, apply or deal
with assets of a benefit fund otherwise than in accordance with this
Code.
5 (2) The assets of a benefit fund may only be applied --
(a) for the purposes of paying any benefit payable to a person
entitled to a benefit from the benefit fund; or
(b) as otherwise permitted by this Code or the society's rules.
Mortgaging assets of benefit fund
10 102. (1) A society must not mortgage or otherwise charge or
encumber an asset of a benefit fund.
(2) If a society's rules and the standards so permit, the society
may, despite subsection (1), mortgage or otherwise charge or encumber
an asset of a benefit fund for the advantage of the benefit fund in
15 accordance with those rules and standards.
Investment of benefit funds
103. (1) A society must not invest assets of a benefit fund
otherwise than in accordance with this Code, the society's rules and the
standards.
20 (2) If the rules of the society and the standards so provide, a
society may, in accordance with this Code, the rules and the standards,
invest assets of 2 or more of its benefit funds in a combined investment.
(3) A society, in investing assets of a benefit fund, must exercise
the care, diligence and skill that a prudent person, whose profession,
25 business or employment is or includes investing assets on behalf of
other persons, would exercise in managing the affairs of other persons.
Payment of money into account
104. A society must, as soon as practicable after it receives any
money for a benefit fund, pay the money --
30 (a) into an account maintained for the benefit fund under
section 99; or
(b) into a funds inward clearing account established under
section 105.
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Funds inward clearing account
105. (1) A society may open at a bank, building society or credit
union an account to be known as a funds inward clearing account.
(2) If, under section 104, money received for a benefit fund is paid
5 into the funds inward clearing account kept by a society, the society
must ensure that the money is paid out of that account and into an
account maintained under section 99 for the benefit fund as soon as
practicable.
(3) If money of a benefit fund is paid into a funds inward clearing
10 account --
(a) the money is money of that benefit fund while it is held in
that account; and
(b) interest earned on the money while held in that account,
less account fees and taxes, belongs to the benefit fund in
15 like proportion to the entitlement of the benefit fund to the
money in that account.
Funds outward clearing account
106. (1) A society may open at a bank, building society or credit
union an account to be known as a funds outward clearing account.
20 (2) If a society withdraws an amount from an account maintained
under section 99 for a benefit fund and does not pay the amount
forthwith to the person entitled to that amount or apply the amount in
accordance with section 101 (2), the society must --
(a) pay the amount into the funds outward clearing account
25 forthwith; and
(b) pay the amount from the funds outward clearing account to
the person as soon as practicable.
(3) If an amount in a funds outward clearing account has not been
paid to the person entitled to it within 3 months after the amount was
30 paid into the account, the amount must, at the expiration of that
period, be paid back to the account from which it was withdrawn.
(4) If money of a benefit fund is paid into a funds outward clearing
account --
(a) the money is money of the benefit fund while it is held in
35 that account; and
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(b) interest earned on the money while held in that account,
less account fees and taxes, belongs to the benefit fund in
like proportion to the entitlement of the benefit fund to the
money in that account.
5 Transfer of an asset between funds
107. (1) A society must not, except in accordance with subsection
(2), transfer an asset --
(a) from one benefit fund of the society to another benefit fund
of the society; or
10 (b) from a benefit fund of the society to the management fund
of the society.
(2) A society may transfer an asset from a benefit fund (the
''transferor fund'') to another benefit fund or the management fund
(the ''transferee fund'') if --
15 (a) the society transfers from the transferee fund to the
transferor fund an amount equal to the fair value of the
asset determined in accordance with section 109; and
(b) in the case of a transfer referred to in subsection (1) (a), the
transfer is fair and reasonable in all the circumstances for
20 the members of the transferor fund and the transferee fund;
(c) in the case of a transfer referred to in subsection (1) (b), the
transfer is fair and reasonable in all the circumstances for
the members of the society.
(3) This section does not apply to --
25 (a) a transfer of assets in accordance with a restructure of one
or more benefit funds under Division 3; or
(b) the distribution of assets in accordance with section 119 on
termination of a benefit fund; or
(c) anything that a liquidator is required to do by or under this
30 Code or any other law of this or any other State or of the
Commonwealth; or
(d) any application of assets of a benefit fund permitted by this
Code or the standards.
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Distribution of surplus in benefit fund
108. (1) If the actuary of a society advises the society that there is
a surplus in a benefit fund, the society, subject to this Code, the rules of
the society and the standards --
5 (a) if the rules of the society so provide, may pay, apply or
allocate all or part of the surplus to the members of the
benefit fund; or
(b) if the rules of the society so provide, may transfer all or
part of the surplus to another benefit fund of the society; or
10 (c) if the rules of the society so provide, may transfer all or
part of the surplus to the management fund of the society.
(2) For the purposes of subsection (1), if any part of a surplus in a
benefit fund comprises an asset other than money, the value of the
asset is the fair value of the asset determined in accordance with
15 section 109.
Fair value of assets
109. For the purpose of sections 107 and 108, the fair value of an
asset is the price a person could reasonably be expected to pay for the
asset on a sale in which the seller and buyer were dealing with each
20 other at arm's length.
Division 3 -- Restructure of Benefit Funds
Definitions
110. In this Division --
''existing fund'' means a benefit fund existing before a
25 restructure under this Division takes effect, other than a
benefit fund of a society that has commenced to be wound
up under Part 9;
''new fund'' means a benefit fund that is or is to be established
under Division 1 for the purposes of a restructure under
30 this Division.
Approval of restructure of benefit funds
111. (1) A society may restructure one or more of its benefit funds
in accordance with this Division by doing any of the following --
(a) transferring the whole or part of one or more existing funds
35 to another existing fund; or
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(b) transferring the whole or part of one or more existing funds
to a new fund.
(2) A society that proposes to restructure one or more of its
existing funds must lodge with the SSA for approval a restructure
5 statement in accordance with subsection (3).
(3) Except so far as the SSA otherwise determines in relation to a
society, a restructure statement must specify --
(a) the name of each existing fund that is to be involved in the
restructure, any proposed change in the name of any such
10 existing fund and the proposed name of any new fund;
(b) the date on which it is proposed that the restructure will
take effect;
(c) the reasons for the proposed restructure;
(d) the effect of the proposed restructure on the interests of the
15 members of each existing fund that is to be involved in the
restructure;
(e) the assets and undertakings of, and liabilities referable to,
each existing fund that is to be involved in the restructure
that will become assets and undertakings of and liabilities
20 referable to another such existing fund or a new fund;
(f) the category or categories of members of each existing fund
that, under the restructure, will become members of
another existing fund or of a new fund;
(g) any interest that any officer of the society has in the
25 proposed restructure;
(h) any compensation or other consideration proposed to be
paid, or any other incentive proposed to be given, to any
officer or member of the society in relation to the proposed
restructure;
30 (i) if applicable, an estimate of the rate of any bonuses payable
from each existing fund up to the date on which it is
proposed that the restructure will take effect;
(j) in the case of a transfer of part of an existing fund, details
of any reserves that the society proposes to retain in the
35 existing fund in accordance with the recommendations of
the society's actuary;
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(k) the financial position of each existing fund that is to be
involved in the restructure as at a date that is not more
than 6 months before the date of the restructure statement;
(l) such other information as the SSA requires.
5 (4) Except in so far as the SSA otherwise determines in relation to
a society, the restructure statement must be accompanied by --
(a) a certificate signed by the society's actuary certifying that,
having regard to all matters relevant to the proposed
restructure, the actuary considers that the restructure
10 would be in the interests of the members of each existing
fund that is to be involved in the restructure;
(b) a copy of the proposed amendment of the society's rules to
recognize the restructure;
(c) a copy of the notice proposed to be issued by the society to
15 notify members of each such existing fund of the
restructure.
(5) A restructure statement must be signed by the directors of the
society and must include a certificate that, having regard to all matters
relevant to the proposed restructure, the directors consider that the
20 restructure would be in the interests of the members of each existing
fund that is to be involved in the restructure.
(6) The SSA may approve a restructure statement if the SSA is
satisfied that --
(a) the society has complied with the requirements of this
25 section;
(b) there is no good reason why the restructure should not be
approved.
(7) If the SSA approves the restructure statement, the proposed
restructure in accordance with the statement must be approved, in
30 relation to each existing fund that is involved in the restructure, by --
(a) a special resolution of the members of the existing fund; or
(b) if the SSA so determines, a resolution of the society's board.
(8) A society, at least 21 days before a meeting of members of an
existing fund to approve a special resolution under subsection (7) (a),
35 must give personally or by post to each member of the fund a copy of
the restructure statement approved by the SSA, or a summary of that
statement approved by the SSA, together with a notice of the meeting
and the proposed special resolution.
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Rules
112. If a proposed restructure is approved in accordance with section
111 (7), the society's board must, by a resolution, amend the society's
rules to the extent necessary to recognize the restructure of an existing
5 fund in accordance with this Division.
Lodgement of information with SSA
113. (1) A society must lodge with the SSA within one month after
a proposed restructure is approved in accordance with section
111 (7) --
10 (a) a copy of the resolutions made under sections 111 (7) and
112; and
(b) an application to register the amendment of the society's
rules to establish a new fund (if any) and to recognize the
restructure of each existing fund involved in the
15 restructure.
(2) A society must lodge with the SSA within 3 months, or such
other period as the SSA determines, after a restructure takes effect --
(a) audited accounts, or accounts in a form approved by the
SSA, for each existing fund involved in the restructure up
20 to the date that the restructure takes effect; and
(b) such other information as the SSA may require.
(3) The accounts in subsection (2) must include, if applicable --
(a) details of any bonuses paid by the society from the fund
and of any reserves retained by the society in the fund
25 during the period to which the accounts relate; and
(b) a statement of the manner in which the units of the fund
were converted to units of another existing fund or of a new
fund.
When a restructure takes effect
30 114. A restructure takes effect on the day on which the SSA registers
the amendment of the rules on an application under section 113 (1).
Effect of restructure
115. (1) This section applies on a restructure under this Division
taking effect.
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(2) If the whole or part of an existing fund is transferred to
another existing fund or to a new fund under this Division --
(a) a member of the existing fund who is in a category specified
in the restructure statement approved by the SSA under
5 this Division becomes a member of the other existing fund
or of the new fund; and
(b) the assets and undertakings of and liabilities referable to
the existing fund become, to the extent specified in the
restructure statement approved by the SSA under this
10 Division, assets and undertakings of and liabilities
referable to the other existing fund or the new fund.
Notification of members
116. (1) A society must, within one month after a restructure
taking effect, give written notice of the restructure to each member of a
15 benefit fund affected by the restructure.
(2) Except so far as the SSA otherwise determines in relation to a
society, a notice under subsection (1) must include --
(a) the name of each existing fund affected by the restructure,
any change in the name of any such existing fund and the
20 name of any new fund;
(b) a statement, in relation to each such existing fund, whether
the restructure affects the whole or part of the fund;
(c) the reasons for the restructure;
(d) details of the restructure;
25 (e) a summary of how the restructure affects the interests of
members of each such existing fund;
(f) details of the amendment of the rules to establish a new
fund (if any) and recognize the restructure of an existing
fund.
30 (3) The SSA may grant an exemption from any of the
requirements of this section, subject to any conditions it considers
appropriate.
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Division 4 -- Termination of Benefit Funds
Application of Division
117. A society, other than a society that has commenced to be wound-
up under Part 9, may terminate a benefit fund in accordance with this
5 Division.
Approval of termination proposal
118. (1) A society that proposes to terminate a benefit fund in
accordance with this Division must lodge with the SSA for approval a
termination statement in accordance with this section.
10 (2) Except so far as the SSA otherwise determines in relation to a
society, a termination statement must specify --
(a) the name of the benefit fund proposed to be terminated;
(b) the date on which it is proposed that the termination will
take effect;
15 (c) the reasons for the proposed termination;
(d) the manner in which the society proposes to distribute the
assets of the benefit fund;
(e) the effect of the proposed termination on the interests of
the members of the benefit fund;
20 (f) any interest that any officer of the society has in the
proposed termination;
(g) any compensation or other consideration proposed to be
paid, or any other incentive proposed to be given, to any
officer or member of the society in relation to the proposed
25 termination;
(h) the financial position of the benefit fund as at a date that is
not more than 6 months before the date of the termination
statement;
(i) such other information as the SSA may require.
30 (3) Except in so far as the SSA otherwise determines in relation to
a society, a termination statement must be accompanied by --
(a) a certificate signed by the society's actuary certifying that,
having regard to all matters relevant to the proposed
termination of the benefit fund, the actuary considers that
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the termination would be in the interests of the members of
the fund;
(b) a copy of the proposed amendment of the society's rules to
recognize the termination of the benefit fund;
5 (c) a copy of the notice proposed to be issued by the society to
notify members of the benefit fund of the termination of the
benefit fund.
(4) A termination statement must be signed by the directors of the
society and must include a certificate that, having regard to all matters
10 relevant to the proposed termination, the directors consider that the
termination would be in the interests of the members of the benefit
fund.
(5) The SSA may approve a termination statement if the SSA is
satisfied that --
15 (a) the society has complied with the requirements of this
section;
(b) there is no good reason why the termination should not be
approved.
(6) If the SSA approves the termination statement, the proposed
20 termination in accordance with the statement must be approved by --
(a) a special resolution of the members of the benefit fund; or
(b) if the SSA so determines, a resolution of the society's board.
(7) A society, at least 21 days before a meeting of members of a
benefit fund to approve a special resolution under subsection (6) (a),
25 must give personally or by post to each member of the fund a copy of
the termination statement approved by the SSA, or a summary of that
statement approved by the SSA, together with a notice of the meeting
and the proposed special resolution.
(8) If the proposed termination is approved in accordance with
30 subsection (6) --
(a) the society must cease to accept new members and any
contributions from existing members in respect of the
benefit fund; and
(b) the society must distribute the assets of the benefit fund in
35 accordance with section 119.
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Distribution of assets of benefit fund
119. (1) If the termination of a benefit fund is approved under
section 118 (6), the assets of the benefit fund must be distributed in
accordance with this section within 12 months after that approval.
5 (2) The assets of a benefit fund must first be applied in accordance
with section 101 (2).
(3) If any assets remain after the application of subsection (2), the
assets must be applied as follows --
(a) first --
10 (i) where the rules of the society provide for the
application of assets on the termination of the benefit
fund, in accordance with the rules;
(ii) where the rules of the society do not provide for the
application of assets on the termination of the benefit
15 fund, in satisfaction of any entitlements of members
of the fund as determined by the society's actuary;
(b) secondly, if any assets remain after the application of
paragraph (a), by way of transfer to the management fund
of the society.
20 (4) For the purpose of making a fair and reasonable determination
of the entitlements to be paid under subsection (3) (a) (ii), a society's
actuary must take into account all the circumstances of the benefit
fund, including --
(a) the rules and standards applicable to the benefit fund; and
25 (b) the history, performance and financial position of the
benefit fund during its existence, whether before or after
the coming into operation of this Code.
Notification of members
120. (1) A society must, not later than the date of distribution of
30 the assets of a benefit fund under section 119, give written notice of the
termination of the benefit fund to each member of the fund.
(2) Except so far as the SSA otherwise determines in relation to a
society, a notice under subsection (1) must include --
(a) the name of the benefit fund that is being terminated;
35 (b) the reasons for the termination of the benefit fund;
(c) details of the termination of the benefit fund;
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(d) a summary of how the termination affects the interests of
members of the fund;
(e) details of the proposed amendment of the rules to recognize
the termination of the benefit fund.
5 (3) The SSA may grant an exemption from any of the
requirements under this section, subject to any conditions it considers
appropriate.
Rules
121. After a society has distributed the assets of a benefit fund in
10 accordance with section 119, the society's board must, by a resolution,
amend the society's rules to the extent necessary to recognize the
termination of the benefit fund in accordance with this Division.
Lodgement of information with SSA
122. (1) A society must lodge with the SSA within one month after
15 the assets of the benefit fund have been distributed in accordance with
section 119 --
(a) a copy of the resolutions made under sections 118 (6) and
121; and
(b) an application to register the amendment of the society's
20 rules to recognize the termination.
(2) A society must lodge with the SSA within 3 months, or such
other period as the SSA determines, after the termination takes
effect --
(a) audited accounts or accounts in a form approved by the
25 SSA for the terminated benefit fund up to the date on
which the termination takes effect;
(b) such other information as the SSA may require.
(3) The accounts in subsection (2) must include, if applicable --
(a) a statement of the distribution of the assets of the benefit
30 fund;
(b) details of any bonuses paid by the society from the benefit
fund during the period to which the accounts relate.
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When termination takes effect
123. A termination of a benefit fund takes effect on the day on which
the SSA registers the amendment of the rules on an application under
section 122.
5 Division 5 -- Assignment of Benefits
Assignment of benefits
124. (1) An assignment of an entitlement to benefits in a benefit
fund of a society may only be made in accordance with this section.
(2) An assignment must be made by memorandum of assignment
10 in the form prescribed by the society's rules and signed by the assignor
and the assignee.
(3) An assignment is not valid until it is registered in accordance
with this section by the society.
(4) The assignor must serve on the society 2 signed copies of the
15 memorandum of assignment and must pay any fee prescribed by the
society's rules.
(5) The society must register the memorandum, and an officer of
the society who is authorized to do so must insert the date of
registration in both copies of the memorandum, sign them, and send
20 one copy to the assignee.
(6) A copy of the memorandum that is signed and dated in
accordance with this section is --
(a) conclusive evidence of the registration of the assignment
and of the date of registration; and
25 (b) as between the society and any person claiming an
entitlement to benefits, conclusive evidence that the
assignee was at the time of registration absolutely entitled
to the benefits, free from all interests (except any lien or
charge that the society has in respect of the benefits), and
30 was legally entitled to receive those benefits and give a
discharge in respect of them.
(7) Except as provided in subsection (8), the assignee under a
registered memorandum --
(a) has all the powers of the assignor in respect of the benefits;
35 and
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(b) is subject to all the liabilities of the assignor in respect of
the benefits; and
(c) may sue in relation to the benefits in the assignee's own
name.
5 (8) The assignee is not, by the operation of this section, admitted
as a member of the society, and the assignor is not deprived of
membership, unless the rules of the society so provide.
(9) The receipt of the assignee is a discharge to the society for all
money paid by the society in respect of the benefits.
10 (10) A discharge, surrender of or security over the benefits that is
given to the society by the assignee is valid in spite of the existence of
any interest of any other person.
(11) The society taking a discharge, surrender or security --
(a) need not inquire into the circumstances of the assignment
15 or the consideration of it; and
(b) is not affected by express, implied or constructive notice of
the existence of any interest of any other person in the
benefits.
Payment to nominee of deceased member
20 125. (1) A member of a society who is at least 16 years old may
nominate a person to whom any benefits from a benefit fund of the
society payable on the death of the member are to be paid.
(2) A member of a society may not nominate an officer of that
society unless the officer is a dependant of the member.
25 (3) A nomination has no effect unless it is --
(a) in writing and signed by the member; and
(b) served on the society.
(4) A nomination may be revoked or varied in the same way that
it is made and is revoked on the death of the nominee.
30 (5) The society, on receiving evidence of the death of the member,
must pay to the nominee any benefits that are payable on that death.
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PART 4B -- OFFERING AND MARKETING OF BENEFITS
Division 1 -- Application and Interpretation
Definitions
126. In this Part --
5 ''application period'', in relation to a disclosure document
issued by a society relating to the provision of benefits,
means --
(a) if, under the terms of the disclosure document,
applications for contributions to a benefit fund must
10 be made before a particular time (which may, for
example, be a specified time or a time to be
determined by the society, but which must not be
more than 12 months after the issue of the disclosure
document or such longer period as the SSA allows),
15 the period starting when the disclosure document is
issued and ending at that time; or
(b) in any other case, the period of 12 months starting
when the disclosure document is issued;
''exempt person'' means a person who is an exempt dealer or an
20 exempt investment adviser under section 68 of the
Corporations Law, and any person who is acting as a
representative of the exempt dealer or exempt investment
adviser in connection with the business of dealing in
benefits or the benefits advisory business;
25 ''licensed adviser'' means a person who holds an investment
advisers licence granted under Part 7.3 of the Corporations
Law;
''licensed dealer'' means a person who holds a dealers licence
granted under Part 7.3 of the Corporations Law;
30 ''proper authority'' --
(a) of a licensed dealer is a proper authority granted
under Division 3 of Part 7.3 of the Corporations Law;
(b) of a licensed adviser is a proper authority granted
under Division 3 of Part 7.3 of the Corporations Law;
35 (c) of a society is a proper authority granted by the
society under Subdivision 3 of Division 4 of this Part.
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Benefits advisory business
127. A reference in this Part to a benefits advisory business, in
relation to a person, is a reference to --
(a) a business of advising other persons about benefits; or
5 (b) a business in the course of which the person publishes
reports relating to benefits.
Application of this Part
128. This Part applies to benefits from a benefit fund, other than --
(a) a benefit fund that is a health benefits fund under the
10 National Health Act 1953 of the Commonwealth; or
(b) a benefit fund that is a superannuation entity within the
meaning of the Superannuation Industry (Supervision)
Act 1993 of the Commonwealth.
Actuarial advice
15 129. A society must not provide benefits of a kind specified in the
standards as requiring actuarial advice unless the society's actuary has
given the society written advice about --
(a) the proposed terms and conditions on which benefits of that
kind are to be provided; and
20 (b) in the case of benefits with a surrender value, the proposed
basis on which the surrender value is to be determined; and
(c) if the benefits are to be calculated by reference to units, the
proposed means by which the unit values are to be
determined; and
25 (d) any other matters about which the standards require a
society to obtain actuarial advice before providing benefits
of that kind.
Representatives
130. (1) Subject to subsection (2), a person is a representative of
30 another person if the first-mentioned person --
(a) is employed by; or
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(b) acts for or by arrangement with,
the other person in connection with a business of dealing in benefits or
a benefits advisory business carried on by the other person.
(2) Except for the purposes of section 184 (b), a person who holds a
5 proper authority from another person is a representative of the other
person.
(3) Subject to subsection (4), a person does an act, or engages in
conduct, as a representative of another person if the first-mentioned
person does the act or engages in the conduct --
10 (a) in connection with a business of dealing in benefits or a
benefits advisory business carried on by the other person;
and
(b) while the first-mentioned person is a representative of the
other person; and
15 (c) as employee or agent of, or otherwise on behalf of, on
account of, or for the benefit of, the other person; and
(d) otherwise than in the course of work of a kind ordinarily
done by accountants, clerks or cashiers.
(4) Except for the purposes of Subdivision 4 of Division 4, a person
20 who holds himself or herself out to be a representative of another
person does an act as a representative of the other person.
Involvement in contraventions
131. Subject to section 163, a person is involved in a contravention if
the person --
25 (a) has aided, abetted, counselled or procured the
contravention; or
(b) has induced, whether by threats or promises or otherwise,
the contravention; or
(c) has been in any way, by act or omission, directly or
30 indirectly, knowingly concerned in, or party to, the
contravention; or
(d) has conspired with others to effect the contravention.
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Conduct
132. (1) A reference in this Part to engaging in conduct is a
reference to doing or refusing to do any act, including the making of, or
the giving effect to a provision of, an agreement.
5 (2) A reference in this Part to conduct, when that expression is
used as a noun otherwise than as mentioned in subsection (1), is a
reference to the doing of, or the refusing to do, any act, including the
making of, or the giving effect to a provision of, an agreement.
(3) Where, in a proceeding under this Part in respect of conduct
10 engaged in by a body corporate, it is necessary to establish the state of
mind of the body, it is sufficient to show that a director, servant or
agent of the body, being a director, servant or agent by whom the
conduct was engaged in within the scope of the person's actual or
apparent authority, had that state of mind.
15 (4) Conduct engaged in on behalf of a body corporate --
(a) by a director, servant or agent of the body within the scope
of the person's actual or apparent authority; or
(b) by any other person at the direction or with the consent or
agreement (whether express or implied) of a director,
20 servant or agent of the body, where the giving of the
direction, consent or agreement is within the scope of the
actual or apparent authority of the director, servant or
agent,
is deemed to have been engaged in also by the body corporate.
25 (5) Where, in a proceeding under this Part in respect of conduct
engaged in by a person other than a body corporate, it is necessary to
establish the state of mind of the person, it is sufficient to show that a
servant or agent of the person, being a servant or agent by whom the
conduct was engaged in within the scope of the servant's or agent's
30 actual or apparent authority, had that state of mind.
(6) Conduct engaged in on behalf of a person other than a body
corporate --
(a) by a servant or agent of the person within the scope of the
actual or apparent authority of the servant or agent; or
35 (b) by any other person at the direction or with the consent or
agreement (whether express or implied) of a servant or
agent of the first-mentioned person, where the giving of the
direction, consent or agreement is within the scope of the
actual or apparent authority of the servant or agent,
40 is deemed to have been engaged in also by the first-mentioned person.
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(7) A reference in this section to the state of mind of a person
includes a reference to the knowledge, intention, opinion, belief or
purpose of the person and the person's reasons for the person's
intention, opinion, belief or purpose.
5 References to doing acts
133. In this Part, unless the contrary intention appears, a reference
to doing any act or thing includes a reference to causing, permitting or
authorizing the act or thing to be done.
Misleading representation
10 134. (1) When a person makes a representation with respect to any
future matter (including the doing of, or the refusing to do, any act) and
the person does not have reasonable grounds for making the
representation, the representation is to be taken to be misleading.
(2) For the purposes of the application of subsection (1) in relation
15 to a proceeding concerning a representation made by a person with
respect to any future matter, the person is, unless the person adduces
evidence to the contrary, deemed not to have had reasonable grounds
for making the representation.
(3) Subsection (1) is deemed not to limit by implication the
20 meaning of a reference to a misleading representation, a representation
that is misleading in a material particular or conduct that is misleading
or is likely or liable to mislead.
Division 2 -- Disclosure Documents and Application Forms
Disclosure document to be lodged
25 135. (1) A person must not issue, or cause to be issued, an
invitation to contribute, or accept a contribution, to a benefit fund of a
society unless a disclosure document relating to that benefit fund and
that complies with this Division has been lodged with the SSA within
the last preceding 12 months.
30 (2) A person must not issue, or cause to be issued, an invitation to
contribute, or accept a contribution, to a benefit fund of a foreign
society unless a disclosure document relating to that benefit fund and
that complies with the corresponding Division to this Division in the
friendly societies legislation of the participating State in which the
35 foreign society is incorporated has been lodged, within the last
preceding 12 months, with the SSA of that participating State.
Penalty applying to this section: $20 000 or imprisonment for 5
years or both.
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Application form
136. A person must not issue a form of application for benefits or for
making contributions to a benefit fund of a society unless --
(a) the form is attached to a disclosure document; and
5 (b) a copy of the form and disclosure document have been
lodged with the SSA.
Maximum penalty: $20 000 or imprisonment for 5 years or both.
Form of disclosure document and date of issue
137. (1) A disclosure document --
10 (a) must be printed in type of a size not less than the type
known as 8 point unless the standards otherwise provide;
(b) must be dated;
(c) must be signed by each director of the society and by each
person named in the document as a proposed director of the
15 society or by a person authorized in writing by the director
or proposed director to sign on his or her behalf;
(d) must contain a statement that an arrangement for the
provision of a benefit to which the document relates will not
be entered into later than 12 months after the date of issue
20 of the document;
(e) must contain any other information required by the
standards to be included in the document;
(f) must comply with any requirements of the standards
applicable to disclosure documents.
25 (2) The date of issue of a disclosure document is the date inserted
in it under subsection (1) (b), unless the contrary is proved.
(3) Each copy of a disclosure document --
(a) must state that the document has been lodged with the
SSA of the State in which the society, or foreign society, is
30 registered as a society;
(b) must specify the date of lodgment;
(c) must state that the SSA with which it is lodged takes no
responsibility as to the contents of the document.
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Disclosure of interests
138. A disclosure document must specify the nature and extent of any
interest that a director or proposed director of a society or an expert has
in respect of --
5 (a) the assets of the benefit fund to which the document
relates;
(b) benefits of the kind to which the document relates and in
respect of which an entitlement, other than an entitlement
available on the same terms and conditions to other
10 members of the benefit fund, is available.
Liability in respect of disclosure document and interests
139. (1) If a requirement of section 137 or 138 is contravened, a
director or other person responsible for, or involved in the preparation
of, the disclosure document does not incur any liability by reason of the
15 contravention if it is proved that --
(a) as regards any matter omitted, the person had no
knowledge of the matter; or
(b) the contravention arose from an honest mistake on the part
of the person concerning the facts; or
20 (c) the contravention was --
(i) in respect of matter that, in the opinion of the court
dealing with the case, was immaterial; or
(ii) otherwise such as, in the opinion of the court, having
regard to all the circumstances of the case, ought
25 reasonably to be excused.
(2) If there is a failure to include in a disclosure document a
statement with respect to matters referred to in section 138, a director
or other person does not have any liability in respect of the failure
unless it is proved that the director or other person had knowledge of
30 the matters not included.
(3) Nothing in this section limits or diminishes any liability that a
person might incur under any rule of law or any enactment or under
this Code apart from this section.
Content of disclosure document
35 140. (1) A disclosure document must contain such information as
persons and their professional advisers would reasonably require, and
reasonably expect to find in the document, for the purpose of making an
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informed assessment of benefits of the kind to which the document
relates including --
(a) the assets and liabilities, financial position, profits and
losses, and prospects of, or referable to, the benefit fund
5 from which the benefits would derive;
(b) the rights attaching to the benefits to which the disclosure
document relates.
(2) In determining what information is required to be included in
a disclosure document, regard must be had to --
10 (a) the nature of the benefits and the society;
(b) the kinds of persons likely to consider applying to
contribute to the benefit fund from which the benefits
would derive;
(c) the fact that certain matters may reasonably be expected to
15 be known to professional advisers of any kind whom those
persons may reasonably be expected to consult;
(d) whether the persons to whom the invitation is to be issued
are members of the society and, if they are, the extent to
which relevant information has previously been given to
20 them by the society;
(e) any information known to the persons to whom the
invitation is to be issued or their professional advisers
under any Act of the Commonwealth or a State.
Conditions requiring waiver of requirements void
25 141. A condition is void if it --
(a) requires or binds a person applying to contribute to a
benefit fund to waive compliance with any requirement of
section 137, 138, 139 or 140; or
(b) purports to affect that person with notice of any contract,
30 document or matter not specifically referred to in the
disclosure document.
Obligation to notify society of false etc. statements
142. (1) If a disclosure document has been lodged and a person
(other than the society) who --
35 (a) is referred to in section 163 (2); or
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(b) authorized or caused the issue of the disclosure document,
becomes aware of a relevant matter during the application period in
relation to the disclosure document, the person must, as soon as
practicable after becoming so aware, give the society written notice of
5 the matter.
Maximum penalty: $5 000 or imprisonment for 12 months, or both.
(2) In subsection (1) --
''relevant matter'' in relation to a disclosure document
means --
10 (a) a material statement in the disclosure document that
is false or misleading; or
(b) a material omission from the disclosure document; or
(c) a significant change affecting a matter included in
the disclosure document; or
15 (d) a significant new matter about which information
would have been required by this Division to be
included in the disclosure document if the matter had
arisen when the disclosure document was prepared.
Correction of false or misleading statements etc. by a
20 supplementary or replacement disclosure document
143. (1) This section applies if a disclosure document has been
lodged and the society becomes aware, during the application period in
relation to the disclosure document, that the disclosure document is
deficient because --
25 (a) it contains a material statement that is false or misleading;
or
(b) there is a material omission from the disclosure document.
(2) As soon as practicable after becoming so aware, the society
must lodge a supplementary disclosure document or a replacement
30 disclosure document that corrects the deficiency and that complies with
whichever of sections 145 and 146 applies.
Maximum penalty: $20 000 or imprisonment for 5 years, or both.
Changes or new matters requiring the issue of a supplementary
or replacement disclosure document
35 144. (1) This section applies if a disclosure document has been
lodged and the society becomes aware, during the application period in
relation to the disclosure document, that --
(a) there has been a significant change affecting a matter
included in the disclosure document; or
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(b) a significant new matter has arisen the inclusion in the
disclosure document of information about which would have
been required by this Division if the matter had arisen
when the disclosure document was prepared.
5 (2) As soon as practicable after becoming so aware, the society
must lodge a supplementary or a replacement disclosure document that
contains particulars of the change or new matter and that complies
with whichever of sections 145 and 146 applies.
Maximum penalty: $20 000 or imprisonment for 5 years, or both.
10 General provisions about supplementary disclosure documents
145. (1) A supplementary disclosure document is a document the
purpose of which is to do either or both of the following in relation to a
disclosure document (the ''original disclosure document'') --
(a) correct a deficiency in the disclosure document;
15 (b) provide particulars about something that has occurred since
the disclosure document was prepared.
(2) On each page of a supplementary disclosure document there
must be a clear statement in bold type that states that the document is
a supplementary disclosure document that is to be read in conjunction
20 with --
(a) the original disclosure document; and
(b) if other supplementary disclosure documents have already
been issued in relation to the original disclosure document,
those supplementary disclosure documents.
25 (3) The statement must clearly identify --
(a) the original disclosure document; and
(b) if subsection (2) (b) applies, the supplementary disclosure
documents to which that subsection refers.
(4) Unless the context otherwise requires, a reference to a
30 disclosure document in any of the provisions referred to in the following
provisions includes a reference to a supplementary disclosure
document --
(a) sections 159, 160 and 161;
(b) sections 163 to 170;
35 (c) sections 137 (1) (a), (b) and (c), (2) and (3) and 139;
(d) sections 142, 150, 155, 156 and 157.
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(5) In this section --
''deficiency'', in relation to a disclosure document, includes, but
is not limited to --
(a) a material statement in the disclosure document that
5 is false or misleading; or
(b) a material omission from the disclosure document.
General provisions about replacement disclosure documents
146. (1) A replacement disclosure document is a document the
purpose of which is to replace a disclosure document (the ''original
10 disclosure document'') and which may also do either or both of the
following --
(a) correct a deficiency in the original disclosure document;
(b) provide particulars about something that has occurred since
the original disclosure document was prepared.
15 (2) On each page of a replacement disclosure document there must
be a clear statement in bold type that identifies the original disclosure
document and states that the document is a replacement disclosure
document that replaces the original disclosure document.
(3) Subject to subsection (2), a replacement disclosure document
20 must have the same wording as the original disclosure document,
except to the extent that it --
(a) corrects a deficiency in the original disclosure document; or
(b) provides particulars about something that has occurred
since the original disclosure document was issued.
25 (4) In this section --
''deficiency'' in relation to a disclosure document, includes, but
is not limited to --
(a) a material statement in the disclosure document that
is false or misleading; or
30 (b) a material omission from the disclosure document.
Consequences of lodging a supplementary disclosure document
147. (1) This section applies if a supplementary disclosure
document has been lodged.
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(2) Subject to subsection (4), for the purposes of this Code, the
information in the supplementary disclosure document is taken, except
in relation to things that happened before it was lodged, to be included
in the original disclosure document.
5 (3) Every copy of the original disclosure document issued after
lodgment of the supplementary disclosure document must be attached
to, or accompanied by, a copy of the supplementary disclosure
document.
Maximum penalty: $20 000 or imprisonment for 5 years, or both.
10 (4) If subsection (3) is contravened in relation to a copy of the
original disclosure document, subsection (2) does not apply for the
purposes of an action under section 162 in relation to that copy.
(5) In this section --
''original disclosure document'' means the disclosure
15 document identified in the supplementary disclosure
document as required by section 145 (3) (a).
Consequences of lodging a replacement disclosure document
148. (1) This section applies if a replacement disclosure document
has been lodged.
20 (2) A copy of the original disclosure document must not be issued
after lodgment of the replacement disclosure document.
Maximum penalty: $20 000 or imprisonment for 5 years, or both.
(3) The replacement disclosure document is a disclosure document
in its own right for the purposes of this Code, but it is taken to have
25 been issued when the original disclosure document was issued.
(4) The parts of the replacement disclosure document that are the
same as the original disclosure document are taken to comply with the
requirements of this Division, but only to the extent to which those
parts of the original disclosure document in fact complied with those
30 requirements.
(5) In this section --
''original disclosure document'' means the disclosure
document identified in the replacement disclosure document
as required by section 146 (2).
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Application made on out of date application form
149. (1) For the purposes of this section, an application form is
current unless --
(a) since the form was issued, a supplementary disclosure
5 document or a replacement disclosure document that
relates to the disclosure document to which the form relates
has been issued; or
(b) because of section 151 (2), the form is no longer current for
the purposes of section 151.
10 (2) This section applies if --
(a) a person applies to contribute to a benefit fund of a society
pursuant to a disclosure document (the ''original
disclosure document'') during the application period in
relation to the disclosure document; and
15 (b) the application form used to make the application is not
current when it is received by the society.
(3) As soon as practicable after receiving the application, the
society must give the person a written notice --
(a) that advises the person that the application form used was
20 not current; and
(b) that states which of options 1 and 2 specified in subsections
(4) and (5) the society is going to follow, and explains that
option; and
(c) that is accompanied by --
25 (i) if a replacement disclosure document has been issued,
a copy of the most recently issued replacement
disclosure document, a copy of each issued
supplementary disclosure document (if any) that
relates to it, and a current application form that
30 relates to it; or
(ii) if sub-paragraph (i) does not apply, a copy of each
supplementary disclosure document (if any) that
relates to the original disclosure document and that
was issued after the application form was issued, and
35 a current application form that relates to the original
disclosure document.
(4) Option 1 requires the society --
(a) to treat the application as having been withdrawn; and
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(b) at the same time as it gives the person the notice, or as
soon as practicable afterwards, to pay to the person, in
accordance with the requirements (if any) of the
standards --
5 (i) any money the person has paid to the society on
account of the provision of the benefits; and
(ii) any interest that has accrued in respect of that
money.
(5) Option 2 requires the society --
10 (a) at the same time as it gives the person the notice, or as
soon as practicable afterwards, to provide the benefits to
the person pursuant to the application and pay any money
received into the relevant benefit fund; and
(b) if, since the application form used to make the application
15 was issued, a material adverse change (as defined in
subsection (6)) has occurred in relation to the provision of
benefits, to give the person a reasonable opportunity to
surrender the benefits and obtain a payment as mentioned
in paragraph (c); and
20 (c) if paragraph (b) applies and the person takes advantage of
that opportunity and surrenders the benefits, to pay to the
person, in accordance with the requirements (if any) of the
standards --
(i) any money the person has paid to the society on
25 account of the provision of the benefits; and
(ii) any interest that has accrued in respect of that
money.
(6) For the purposes of subsection (5), a material adverse change
occurs in relation to the provision of benefits if a change occurs, or a
30 new matter arises, that is likely to have a material adverse effect on
the ability of the society to meet the obligations to provide the benefits.
(7) The society must act in accordance with the option specified in
the notice.
Maximum penalty: $2 500 or imprisonment for 6 months, or both.
35 (8) In this section --
''application form'' means a form of application to contribute to
a benefit fund;
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''disclosure document to which the form relates'', in relation
to an application form that has been issued, means the
disclosure document to which the form is or was attached.
Inclusion of documents in disclosure documents by reference
5 150. (1) For the purposes of this Code, other than sections 137, 138
and 139, a disclosure document is taken to include a document, or part
of a document, as the case requires, if the disclosure document --
(a) refers to a document lodged under this Code or a
corresponding previous law, being a document in existence
10 at or before the lodgment of the disclosure document; and
(b) includes a summary of the document or of a part of it; and
(c) includes a statement to the effect that the society will
provide a copy of the document, or of the part, as the case
requires, free of charge, to a person who asks for it during
15 the application period in relation to the disclosure
document.
(2) The society must comply with a statement included in the
disclosure document in accordance with subsection (1) (c).
Disclosure document referring to information set out in current
20 application form
151. (1) This section applies if --
(a) a disclosure document has been lodged; and
(b) the disclosure document states that specified information
(the ''incorporated information'') is to be set out in an
25 application form; and
(c) a copy of such a form (the ''relevant form'') has also been
lodged.
(2) For the purposes of this section, the relevant form is current
from the time when the copy was lodged until the next time (if any)
30 when a copy of a form of the kind referred to in subsection (1) (b) is
lodged.
(3) Subject to subsection (5), for the purposes of this Code, the
incorporated information, as set out in the relevant form, is taken to be
included in the disclosure document while the relevant form is current.
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(4) Each copy of the disclosure document that is issued while the
relevant form is current must have attached to it the relevant form or a
copy of it.
Maximum penalty: $20 000 or imprisonment for 5 years, or both.
5 (5) If subsection (4) is contravened in relation to a copy of the
disclosure document, subsection (3) does not apply for the purposes of
an action under section 162 in relation to that copy.
(6) Unless the context otherwise requires, a reference to a
disclosure document in any of the provisions referred to in the following
10 provisions includes a reference to the relevant form while it is or was
current --
(a) sections 159, 160 and 161;
(b) sections 163 to 170;
(c) sections 137 (1) (a) and (b) and (2) and 139 (1);
15 (d) sections 142, 150, 155, 156 and 157.
(7) The relevant form, or a copy of it, must not be issued when the
relevant form is no longer current.
Maximum penalty applying to subsection (7): $20 000 or
imprisonment for 5 years, or both.
20 Certain notices etc. not to be published
152. (1) In this section --
''notice'' does not include a disclosure document that has been
lodged or a report, statement or notice the publication of
which is permitted under section 153.
25 (2) Nothing in this Part prohibits the publishing of a notice
that --
(a) is published by the person who issued the disclosure
document concerned, or by a licensed adviser or licensed
dealer or an exempt person within the meaning of section
30 126; and
(b) states that a disclosure document has been lodged; and
(c) specifies the date of the disclosure document; and
(d) states where a copy of the disclosure document can be
obtained; and
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(e) states that benefits to which the disclosure document
relates will be provided only on receipt of a form of
application referred to in and attached to a copy of the
disclosure document.
5 (3) Except as provided by subsection (2), a person must not
publish a notice that --
(a) invites any person to apply to contribute to a benefit fund;
(b) refers or calls attention, whether directly or indirectly --
(i) to a disclosure document relating to a benefit fund; or
10 (ii) to an invitation or proposed invitation to apply to
contribute to a benefit fund; or
(iii) to another notice that refers or calls attention to a
disclosure document relating to a benefit fund or an
invitation or proposed invitation to apply to
15 contribute to a benefit fund, not being a notice
referred to in subsection (2).
Maximum penalty applying to subsection (3): $2 500 or
imprisonment for 6 months, or both.
Certain reports referring to disclosure documents not to be
20 published
153. (1) In this section, unless the contrary intention appears --
''report'' includes a statement or notice, whether or not in
writing, but does not include a notice the publication of
which is permitted under section 152.
25 (2) Nothing in this Part prohibits the publishing of --
(a) a report by a society or any of its officers or agents that --
(i) is required by law; or
(ii) is permitted by the SSA; or
(b) a report that is a news report (whether or not with other
30 comment), or is genuine comment, published by a person in
a newspaper or periodical or by broadcasting or televising
relating to --
(i) a disclosure document that has been lodged or
information contained in such a disclosure document;
35 or
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(ii) a report referred to in paragraph (a) --
if none of the following --
(iii) that person;
(iv) an agent or employee of that person;
5 (v) where the report or comment is published in a
newspaper or periodical, the publisher of the
newspaper or periodical; or
(vi) where the report or comment is published by
broadcasting or televising, the licensee of the
10 broadcasting or television station by which it is
published,
receives or is entitled to receive any consideration or other
advantage from a person who has an interest in the success
of the invitation to which the report or comment relates as
15 an inducement to publish, or as the result of the publication
of, the report or comment; or
(c) a report where the report is not published --
(i) by or on behalf of a society to which the report relates
or, whether directly or indirectly, at the instigation of,
20 or by arrangement with, the society or its directors;
or
(ii) by or on behalf of a person who has an interest in the
success of the invitation to which the report relates,
and the person publishing the report does not receive and is
25 not entitled to receive any consideration or other advantage
from the society or any of its directors, or from a person
mentioned in sub-paragraph (ii), as an inducement to
publish, or as the result of the publication of, the report.
(3) Except as provided by subsection (2), a person who is aware
30 that a disclosure document --
(a) is in the course of preparation by or on behalf of a society;
or
(b) has been issued by or on behalf of a society,
must not publish a report that is reasonably likely to induce persons to
35 apply to contribute to a benefit fund of the kind to which the disclosure
document relates.
Maximum penalty applying to subsection (3): $2 500 or
imprisonment for 6 months, or both.
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Evidentiary provisions etc.
154. (1) In this section --
''notice'' means a notice within the meaning of section 152;
''report'' means a report within the meaning of section 153.
5 (2) A person who publishes a notice or report relating to a society
after receiving a certificate that --
(a) specifies the names of 2 directors of the society and is
signed by those directors; and
(b) is to the effect that, because of sections 152 (2) or 153 (2),
10 sections 152 (3) or 153 (3), as the case requires, do not
apply to the notice or report,
does not contravene subsection 152 (3) or 153 (3), as the case requires.
(3) Where a notice or report to which a certificate under subsection
(2) relates is published, each director who signed that certificate, for the
15 purposes of sections 152 and 153, is deemed to have published the
notice or report.
(4) A person who publishes a notice or report to which a certificate
under subsection (2) relates must, if the SSA requires the person to do
so, deliver the certificate to the SSA as soon as practicable.
20 Maximum penalty: $1 000 or imprisonment for 3 months, or both.
(5) In proceedings for a contravention of section 152 or 153 a
certificate relating to a notice or report that purports to be a certificate
under this section is evidence, unless evidence to the contrary is
adduced, that --
25 (a) when the certificate was issued, the persons named in the
certificate as directors of the society were the directors; and
(b) the signatures in the certificate purporting to be the
signatures of the directors are those signatures; and
(c) the publication of the notice was authorized by those
30 directors.
(6) Nothing in section 152 or 153 or this section limits or
diminishes the liability that a person may incur, otherwise than under
section 152 or 153 or this section, under any rule of law or under any
other enactment.
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Documents to be kept
155. A society that has lodged, or caused to be lodged, a disclosure
document with the SSA must cause --
(a) a true copy, verified by a statement in writing, of any
5 consent required by section 156 to the issue of the
disclosure document; and
(b) a true copy, verified by a statement in writing, of every
material contract referred to in the disclosure document or,
in the case of such a contract that is not reduced to writing,
10 a memorandum, verified by a statement in writing, giving
full particulars of the contract,
to be deposited, within 7 days after lodgment of the disclosure
document, at the registered office of the society and must keep each
such copy for a period of at least 12 months after the lodgment of the
15 disclosure document for inspection by any person without charge.
Expert's consent to issue of disclosure document containing
statement by the expert
156. A person must not issue a disclosure document that includes a
statement purporting to be made by an expert or to be based on a
20 statement made by an expert unless --
(a) the expert has given, and has not, before lodgment of the
disclosure document, withdrawn, the expert's written
consent to the issue of the disclosure document with the
statement included in the form and context in which it is
25 included; and
(b) there appears in the disclosure document a statement that
the expert has given, and has not withdrawn, the expert's
consent.
Maximum penalty: $2 500 or imprisonment for 6 months, or both.
30 Direction not to accept contributions
157. (1) Where it appears to the SSA with which a disclosure
document is lodged that any of the circumstances referred to in
subsection (2) exist in respect of the disclosure document, the SSA may,
by order in writing served on the person by whom the disclosure
35 document was lodged, direct the society not to --
(a) issue an invitation to contribute to the benefit fund to
which the disclosure document relates;
(b) accept a contribution to that benefit fund.
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(2) The circumstances are --
(a) the disclosure document contravenes in a substantial
respect any of the requirements of this Division;
(b) the disclosure document contains a statement, promise,
5 estimate or forecast that is false, misleading or deceptive;
(c) the disclosure document contains a material
misrepresentation.
(3) Subject to this section, the SSA must not make an order under
subsection (1) unless the SSA has held a hearing and given a
10 reasonable opportunity to any interested persons to make oral or
written submissions to the SSA on the question whether such an order
should be made.
(4) If the SSA considers that any delay in making an order under
subsection (1) pending the holding of a hearing would be prejudicial to
15 the public interest, the SSA may make an interim order or interim
orders under that subsection without holding a hearing.
(5) Subject to subsection (6), an interim order, unless sooner
revoked, has effect until the end of 21 days after the day on which it is
made.
20 (6) At any time during the hearing, the SSA may make an interim
order under subsection (1) that is expressed to have effect until the SSA
makes a final order after the conclusion of the hearing or until the
interim order is revoked, whichever first happens.
(7) While an order is in force under this section --
25 (a) this Division applies as if the disclosure document had not
been lodged; and
(b) a person is not entitled to lodge a further disclosure
document in relation to the relevant benefit fund, other
than a supplementary disclosure document or a
30 replacement disclosure document.
(8) If, while an order is in force under this section, the SSA
becomes satisfied that, whether because of the lodgment of a
supplementary disclosure document or replacement disclosure document
or otherwise, the circumstances that resulted in the making of the order
35 no longer exist, the SSA may, by further order in writing, revoke the
first-mentioned order.
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Exemptions and modifications
158. (1) The SSA with which a disclosure document is lodged or,
but for this section, would have been lodged, may, subject to and in
accordance with the standards, by writing, exempt a particular person
5 or persons or a particular class of persons, either generally or as
otherwise provided in the exemption, and either unconditionally or
subject to such conditions (if any) as are specified in the exemption,
from compliance with all or any of the provisions of --
(a) this Division;
10 (b) See note to section 1.
(2) Without limiting the generality of subsection (1), an exemption
under that subsection may relate to particular benefits or to a
particular class of benefits.
(3) A person must not contravene a condition to which an
15 exemption under subsection (1) is subject.
(4) Where a person has contravened a condition to which an
exemption under subsection (1) is subject, the Court may, on the
application of the SSA, order the person to comply with the condition.
(5) The SSA may, subject to and in accordance with the standards,
20 by writing, declare that this Division has effect in its application to a
particular person or persons, or a particular class of persons, either
generally or as otherwise provided in the declaration as if a specific
provision or provisions of this Division were omitted, modified or varied
in a manner specified in the declaration, and, where such a declaration
25 is made, this Division has effect accordingly.
(6) Without limiting the generality of subsection (5), a declaration
under that subsection may relate to particular benefits or a particular
class of benefits.
(7) The SSA must cause to be published in the Gazette a statement
30 to the effect that an exemption has been granted or a declaration made
under this section in relation to a particular class of persons or a
particular class of benefit funds.
Division 3 -- Prohibited Conduct and Civil Liability
Statement in a disclosure document
35 159. For the purposes of this Division, a statement is taken to be in a
disclosure document if it is --
(a) contained in a report or memorandum that appears on the
face of the disclosure document; or
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(b) contained in a report or memorandum that is issued with
the disclosure document with the consent or knowledge of a
person who authorized or caused the issue of the disclosure
document; or
5 (c) incorporated by reference in the disclosure document,
whether the reference occurs in the disclosure document or
in any other document.
Misleading or deceptive conduct
160. (1) A person must not engage in conduct that is misleading or
10 deceptive or is likely to mislead or deceive, being conduct in or in
connection with --
(a) any dealing in benefits; or
(b) without limiting the generality of paragraph (a), any
disclosure document issued, or notice published, in relation
15 to benefits.
(2) A person who contravenes this section is not guilty of an
offence.
(3) Nothing in this Division or Division 2 is to be taken as limiting
by implication the generality of subsection (2).
20 Mis-statements and omissions in disclosure documents
161. (1) A person must not authorize or cause the issue of a
disclosure document in relation to benefits if --
(a) the disclosure document has been, or is required to be,
lodged under Division 2; and
25 (b) either --
(i) a material statement in the disclosure document is
false or misleading; or
(ii) there is a material omission from the disclosure
document.
30 Maximum penalty: $20 000 or imprisonment for 5 years, or both.
(2) It is a defence to a prosecution for a contravention of
subsection (1) if it is proved --
(a) that the defendant, after making such inquiries (if any) as
were reasonable, had reasonable grounds to believe, and did
35 until the time of the issue of the disclosure document
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believe, that the statement was true and not misleading or
the omission was not material; or
(b) where there was an omission from the disclosure document,
that the omission was inadvertent.
5 (3) A person does not contravene this section merely because the
person gave a consent required by this Part to the inclusion in the
disclosure document of a statement purporting to be made by the
person as an expert.
Civil liability for contravention of this Division or Division 2
10 162. (1) Subject to the following sections of this Division, a person
who suffers loss or damage by conduct of another person that was
engaged in in contravention of a provision of this Division or Division 2
may recover the amount of the loss or damage by action against that
other person or against any person involved in the contravention,
15 whether or not that other person or any person involved in the
contravention has been convicted of an offence in respect of the
contravention.
(2) An action under subsection (1) may be begun at any time
within 6 years after the day on which the cause of action arose.
20 (3) This Division does not affect any liability that a person has
under any other law.
(4) In a proceeding under this Division in relation to a
contravention of this Division or Division 2 committed by the
publication of an advertisement, it is a defence if it is proved that the
25 defendant is a person whose business it is to publish or arrange for the
publication of advertisements and that the person received the
advertisement for publication in the ordinary course of business and did
not know and had no reason to suspect that its publication would
amount to a contravention of a provision of this Division or Division 2.
30 Civil liability for false or misleading statement in, or omission
from, a disclosure document
163. (1) This section applies for the purposes of an action under
section 162 in respect of conduct being the issue of a disclosure
document in relation to benefits --
35 (a) in which there is a material statement that is false or
misleading; or
(b) from which there is a material omission.
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(2) The reference in section 162 (1) to any person involved in the
contravention includes a reference to all or any of the following
persons --
(a) the society;
5 (b) a person who was a director of the society at the time of the
issue of the disclosure document;
(c) a person who authorized or caused himself or herself to be
named, and is named, in the disclosure document as a
director of the society or as having agreed to become a
10 director of the society either immediately or after an
interval of time;
(d) if the disclosure document includes a statement that
purports to be, or to be based on, a statement made by an
expert and the expert gave consent under section 156 to the
15 issue of the disclosure document, that expert;
(e) a person named, with the consent of the person, in the
disclosure document as an auditor, actuary, banker or
solicitor of the society or for or in relation to benefits or
proposed benefits;
20 (f) a person named, with the consent of the person, in the
disclosure document as having performed or performing any
function in a professional, advisory or other capacity not
mentioned in paragraph (d) or (e) for the society or for or in
relation to benefits or proposed benefits.
25 No liability to person with knowledge of relevant matter
164. A person referred to in section 163 (2), or a person who
authorized or caused the issue of the disclosure document, is not liable
in an action under section 162 to a person who suffered loss or damage
as a result of a false or misleading statement in, or an omission from,
30 the disclosure document if it is proved that, when the last-mentioned
person applied for benefits to which the disclosure document relates,
that person knew that the statement was false or misleading or was
aware of the omitted matter.
Non-consenting directors not liable
35 165. (1) A person referred to in section 163 (2) (b) or (c) is not, in
the circumstances set out in this section, liable in an action under
section 162 to a person who suffered loss or damage as a result of a
false or misleading statement in, or an omission from, the disclosure
document.
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(2) If the person is a person referred to in section 163 (2) (c), the
person is not liable if it is proved that, having consented to become a
director of the society, the person withdrew the consent before the issue
of the disclosure document, and that it was issued without the person's
5 authority or consent.
(3) The person is not liable if it is proved that the disclosure
document was issued without the person's knowledge or consent and --
(a) as soon as practicable after the person became aware of the
issue of the disclosure document, the person gave
10 reasonable public notice that it was issued without the
person's knowledge; or
(b) as soon as practicable after the disclosure document was
issued, the person gave reasonable public notice that the
disclosure document was issued without the person's
15 consent,
as the case requires.
(4) The person is not liable if it is proved that, after the issue of
the disclosure document and before receiving any contributions in
relation to benefits under the disclosure document, the person, on
20 becoming aware of any false or misleading statement in, or omission
from, the disclosure document, withdrew the person's consent to the
issue of the disclosure document and gave reasonable public notice of
the withdrawal and of the reason for the withdrawal.
Directors not liable where they have reasonable grounds for
25 believing disclosure document to be correct
166. (1) A person referred to in section 163 (2) (b) or (c) is not, in
the circumstances set out in this section, liable in an action under
section 162 to a person who suffered loss or damage as a result of --
(a) a false or misleading statement (in this section called the
30 ''defective statement'') in the disclosure document; or
(b) an omission from a statement (in this section also called the
''defective statement'') in the disclosure document.
(2) If the defective statement --
(a) purports to be, or to be based on, a statement made by an
35 expert; or
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(b) is contained in what purports to be a copy of, or extract
from, a report or valuation of an expert,
the person is not liable if it is proved that --
(c) the defective statement fairly represented the statement
5 referred to in paragraph (a), or the purported copy or
extract was a correct and fair copy of, or extract from, the
report or valuation, as the case requires; and
(d) the person, after making such inquiries (if any) as were
reasonable, had reasonable grounds to believe, and did
10 believe until the time of the provision of the benefits, that
the person who made the statement referred to in
paragraph (a), or who made the report or valuation, as the
case requires --
(i) was competent to make it; and
15 (ii) had given the consent required by section 156 to the
issue of the disclosure document; and
(iii) had not withdrawn that consent.
(3) If the defective statement --
(a) purports to be a statement made by an official person; or
20 (b) is contained in what purports to be a copy of, or extract
from, a public official document,
the person is not liable if it is proved that the defective statement fairly
represented the statement referred to in paragraph (a), or that the
purported copy or extract was a correct and fair copy of, or extract from,
25 the document, as the case requires.
(4) If none of subsections (2) (a) and (b) and (3) (a) and (b) applies
in relation to the defective statement, the person is not liable if it is
proved that he or she, after making such inquiries (if any) as were
reasonable, had reasonable grounds to believe, and did believe until the
30 time of the issue of the benefits --
(a) if subsection (1) (a) applies, that the defective statement
was true and not misleading; or
(b) if subsection (1) (b) applies, that there were no material
omissions from the defective statement.
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Liability of experts, auditors etc.
167. (1) A person referred to in section 163 (2) (d), (e) or (f) is liable
in an action under section 162 only in respect of --
(a) a false or misleading statement in the disclosure document
5 purporting to be made by the person as a person referred to
in section 163 (2) (d), (e) or (f), or to be based on a
statement made by the person as a person referred to in
section 163 (2) (d), (e) or (f); or
(b) in the case of a person referred to in section 163 (2) (d), an
10 omission of any material matter from a statement in the
disclosure document purporting to be made by the person as
a person referred to in section 163 (2) (d) or to be based on
a statement made by the person as such a person; or
(c) in the case of a person referred to in section 163 (2) (e) or
15 (f), an omission from the disclosure document of any
material matter for which the person is responsible in the
person's capacity or purported capacity as a person referred
to in section 163 (2) (e) or (f).
(2) A person referred to in section 163 (2) (d) is not liable in an
20 action under section 162 in respect of a false or misleading statement
in, or an omission from, the disclosure document if it is proved --
(a) that, having given consent under section 156 to the issue of
the disclosure document, the person withdrew it in writing
before the disclosure document was lodged;
25 (b) that, after the disclosure document was lodged and before
the provision of any benefits under the disclosure document,
the person, on becoming aware of the false or misleading
statement, or of the omission, as the case requires,
withdrew the person's consent in writing and gave
30 reasonable public notice of the withdrawal and of the
reasons for the withdrawal; or
(c) that the person was competent to make the statement and,
after making such inquiries (if any) as were reasonable, had
reasonable ground to believe, and did until the time of the
35 provision of any benefits believe, that --
(i) if the action is in respect of a false or misleading
statement, the statement was true and not
misleading; or
(ii) if the action is in respect of an omission from a
40 statement, there were no material omissions from the
statement.
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(3) A person referred to in section 163 (2) (e) or (f) is not liable in
an action under section 162 in respect of a false or misleading
statement in, or an omission from, the disclosure document if it is
proved --
5 (a) that, after the disclosure document was lodged and before
the provision of any benefits under the disclosure document
the person, on becoming aware of the false or misleading
statement or of the omission, as the case requires, withdrew
the person's consent in writing and gave reasonable public
10 notice of the withdrawal and of the reasons for the
withdrawal; or
(b) in the case of a statement, that the person was competent
to make the statement and, after making such inquiries (if
any) as were reasonable, had reasonable grounds to believe,
15 and did until the time of the provision of any benefits
believe, that the statement was true and not misleading; or
(c) in the case of an omission, that the person, after making
such inquiries (if any) as were reasonable, had reasonable
grounds to believe, and did until the time of the provision of
20 any benefits believe, that there were no omissions from the
disclosure document of material matters for which the
person was responsible in the person's capacity as a person
referred to in section 163 (2) (e) or (f) as the case requires,
and that the person was competent to act in that capacity.
25 Liability of persons named in disclosure document
168. (1) A person referred to in section 163 (2) (e) or (f) who is
named in part only of the disclosure document is not liable in an action
under section 162 in respect of a false or misleading statement in, or an
omission from, the disclosure document if it is proved that --
30 (a) the statement was not included in, or the matter was not
omitted from, that part of the disclosure document; or
(b) in the case of a statement, the statement was not included
in, or substantially in, the form and context that the person
had agreed to.
35 (2) For the purposes of subsection (1), a person referred to in
section 163 (2) (e) or (f) shall not be taken to be named in part only of
the disclosure document unless the disclosure document includes an
express statement that the person was involved only in the preparation
of that part.
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(3) A person who has authorized or caused the issue of part only of
a disclosure document is not liable in an action under section 162 in
respect of a false or misleading statement in, or an omission from, the
disclosure document if it is proved that --
5 (a) the statement was not included in, or the matter was not
omitted from, that part of the disclosure document; or
(b) in the case of a statement, the statement was not included
in, or substantially in, the form and context that the person
had agreed to.
10 (4) For the purposes of subsection (3), a person is not taken to
have authorized or caused the issue of part only of a disclosure
document unless the disclosure document includes an express statement
that the person authorized or caused the issue of that part only.
No liability for mistake etc. if reasonable precautions taken
15 169. (1) The society or a person who authorized or caused the issue
of the disclosure document is not liable in an action under section 162 if
it is proved that the false or misleading statement or the omission --
(a) was due to a reasonable mistake; or
(b) was due to reasonable reliance on information supplied by
20 another person; or
(c) was due to the act or default of another person, to an
accident or to some other cause beyond the defendant's
control,
and, in a case to which paragraph (c) applies, that the defendant took
25 reasonable precautions and exercised due diligence to ensure that all
statements to be included in the disclosure document were true and not
misleading and that there were no material omissions from the
disclosure document.
(2) In subsection (1) (b) and (c) --
30 ''another person'' does not include a person who, when the
disclosure document was issued, was --
(a) a servant or agent of the defendant; or
(b) if the defendant was the society or another body
corporate, a director, servant or agent of the
35 defendant.
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Indemnity
170. Where --
(a) a disclosure document in relation to benefits contains the
name of a person as a director of the society, or as having
5 agreed to become a director, and that person has not
consented to become a director, or has withdrawn the
consent before the issue of the disclosure document, and
has not authorized or consented to the issue of the
disclosure document; or
10 (b) the consent of a person is required under section 156 to the
issue of the disclosure document and the person either has
not given that consent or has withdrawn it before the issue
of the disclosure document,
the directors of the society, except any without whose knowledge or
15 consent the disclosure document was issued, and any other person who
authorized or caused the issue of the disclosure document are jointly
and severally liable to indemnify the person so named or whose consent
was so required against all damages, costs and expenses to which the
person may be made liable --
20 (c) because of the person's name being so contained in the
disclosure document;
(d) because of the inclusion in the disclosure document of a
statement purporting to be made by the person as an
expert; or
25 (e) in defending any action or other legal proceeding brought
against the person because of the person's name being so
contained in the disclosure document or the inclusion in the
disclosure document of such a statement.
Division 4 -- Regulation of Industry Participants
30 Subdivision 1 -- Conduct in relation to benefits
Dealing
171. (1) A person must not carry on a business of dealing in
benefits, or hold out that the person carries on such a business, unless
the person is --
35 (a) a society; or
(b) a licensed dealer; or
(c) an exempt person.
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(2) For the purpose of determining --
(a) whether a person carries on, or holds himself, herself or
itself out as carrying on, a business of dealing in benefits;
and
5 (b) whether or not a person deals in benefits,
an act done on behalf of, or as a representative of, a society, a licensed
dealer or an exempt person is to be disregarded.
Advising
172. (1) A person must not carry on a benefits advisory business, or
10 hold out that the person carries on such a business, unless the person
is --
(a) a society; or
(b) a licensed dealer; or
(c) a licensed adviser; or
15 (d) an exempt person.
(2) The following subsections apply for the purposes of
determining --
(a) whether a person carries on a benefits advisory business;
and
20 (b) whether a person holds himself, herself, or itself out to be
carrying on such a business.
(3) If the person is a body corporate authorized by a law of a State
to take in its own name a grant of probate of the will, or a grant of
letters of administration of the estate, of a dead person, an act done by
25 the first-mentioned person is to be disregarded.
(4) If the person is a solicitor, an accountant or actuary in public
practice as such, an act that the person does is to be disregarded if it is
merely incidental to the practice of his or her profession.
(5) The fact that the person advises other persons about benefits
30 or publishes reports relating to benefits, in some or all of the following
circumstances is to be disregarded --
(a) in a newspaper or periodical --
(i) of which the person is the proprietor or publisher;
and
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(ii) that is generally available to the public otherwise
than only on subscription;
(b) in the course of, or by means of, transmissions that --
(i) the person makes by means of an information service;
5 or
(ii) are made by means of an information service that the
person owns, operates or makes available,
and are generally available to the public;
(c) in sound recordings, video recordings, or data recordings,
10 that the person makes generally available to the public in
either or both of the following ways --
(i) by supplying copies of them to the public; or
(ii) by causing the sound recordings to be heard by, the
video recordings to be seen and heard by, or the
15 contents of the data recordings to be displayed or
reproduced for, the public, as the case requires.
(6) Subsection (5) does not apply in relation to a newspaper or
periodical, or transmissions, sound recordings, video recordings or data
recordings, as the case requires, whose sole or principal purpose is to
20 advise other persons about benefits or to publish reports relating to
benefits.
(7) The fact that the person holds himself, herself or itself out as
advising other persons, or publishing reports relating to benefits, as
mentioned in subsection (5), is to be disregarded.
25 (8) An act that the person does as a representative of a society, a
licensed dealer, a licensed adviser or an exempt person is to be
disregarded.
Subdivision 2 -- Agreements with unlicensed persons
Certain persons not clients
30 173. A reference in this Subdivision to a client does not include a
reference to a person who is --
(a) a licensed dealer; or
(b) a licensed adviser; or
(c) one of 2 or more persons who together constitute a licensed
35 dealer or a licensed adviser.
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Agreements with unlicensed persons
174. (1) Sections 175 to 183 apply where, during a period when a
person (in this Subdivision called the ''non-licensee'') is unlicensed,
the non-licensee and a client of the non-licensee enter into an
5 agreement that --
(a) constitutes, or relates to, a dealing or proposed dealing in
benefits; or
(b) relates to advising the client about benefits, or giving the
client reports relating to benefits.
10 (2) Sections 175 to 183 apply to an agreement mentioned in
subsection (1) whether or not anyone else is a party to the agreement.
(3) A person is unlicensed during a period when the person --
(a) in contravention of section 171, carries on, or holds out that
the person carries on, a business of dealing in benefits; or
15 (b) in contravention of section 172, carries on a benefits
advisory business or holds out that the person carries on
such a business.
Client may give notice of rescission
175. (1) Subject to this section, the client may, whether before or
20 after completion of the agreement, give to the non-licensee a written
notice stating that the client wishes to rescind the agreement.
(2) The client may only give a notice under this section within a
reasonable period after becoming aware of the facts entitling the client
to give the notice.
25 (3) The client is not entitled to give a notice under this section if
the client engages in conduct by engaging in which the client would, if
the entitlement so to give a notice were a right to rescind the
agreement for misrepresentation by the non-licensee, be taken to have
affirmed the agreement.
30 (4) The client is not entitled to give a notice under this section if,
within a reasonable period before the agreement was entered into, the
non-licensee informed the client (whether or not in writing) that the
non-licensee was unlicensed.
(5) If, at a time when a securities licence (as defined in subsection
35 (8)) held by the non-licensee was suspended, the non-licensee informed
the client that the licence was suspended, the non-licensee is to be
taken for the purposes of subsection (4) to have informed the client at
that time that the non-licensee was unlicensed.
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(6) Nothing in subsections (2), (3) and (4) limits the generality of
any of the others.
(7) Subject to this section, the client may give a notice under this
section whether or not --
5 (a) the notice will result under section 176 in rescission of the
agreement; or
(b) the Court will, if the notice so results, be empowered to
make a particular order, or any order at all, under section
178.
10 (8) In this section --
''securities licence'' means an investment advisers licence
granted under Part 7.3 of the Corporations Law or a
dealers licence granted under that Part.
Effect of notice under section 175
15 176. A notice given under section 175 rescinds the agreement unless
rescission of the agreement would prejudice a right, or an estate in
property, acquired by a person (other than the non-licensee) in good
faith, for valuable consideration and without notice of the facts entitling
the client to give the notice.
20 Client may apply to Court for partial rescission
177. (1) If the client gives a notice under section 175 but the notice
does not rescind the agreement because rescission of it would prejudice
a right or estate of the kind referred to in section 176, the client may,
within a reasonable period after giving the notice, apply to the Court
25 for an order under subsection (4) of this section.
(2) The Court may extend the period for making an application
under subsection (1).
(3) If an application is made under subsection (1), the Court may
make such orders expressed to have effect until the determination of
30 the application as it would have power to make if the notice had
rescinded the agreement under section 176 and the application were for
orders under section 178.
(4) On an application under subsection (1), the Court may make
an order --
35 (a) varying the agreement in such a way as to put the client in
the same position, as nearly as can be done without
prejudicing such a right or estate acquired before the order
is made, as if the agreement had not been entered into; and
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(b) declaring the agreement to have had effect as so varied at
and after the time when it was originally made.
(5) If the Court makes an order under subsection (4), the
agreement is to be taken for the purposes of section 178 to have been
5 rescinded under section 176.
(6) An order under subsection (4) does not affect the application of
section 180 or 182 in relation to the agreement as originally made or as
varied by the order.
Court may make consequential orders
10 178. (1) Subject to subsection (2), on rescission of the agreement
under section 176, the Court, on the application of the client or the non-
licensee, may make such orders as it would have power to make if the
client had duly rescinded the agreement for misrepresentation by the
non-licensee.
15 (2) The Court is not empowered to make a particular order under
subsection (1) if the order would prejudice a right, or an estate in
property, acquired by a person (other than the non-licensee) in good
faith, for valuable consideration and without notice of the facts entitling
the client to give the notice.
20 Agreement unenforceable against client
179. (1) This section --
(a) applies while both of the following are the case --
(i) the client is entitled to give a notice under section
175;
25 (ii) a notice so given will result under section 176 in
rescission of the agreement; and
(b) applies after the agreement is rescinded under section 176,
but does not otherwise apply.
(2) The non-licensee is not entitled, as against the client --
30 (a) to enforce the agreement, whether directly or indirectly; or
(b) to rely on the agreement, whether directly or indirectly and
whether by way of defence or otherwise.
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Non-licensee not entitled to recover commission
180. (1) Without limiting the generality of section 179, this
section --
(a) applies while the client is entitled to give a notice under
5 section 175; and
(b) applies after the client so gives a notice, even if the notice
does not result under section 176 in rescission of the
agreement,
but does not otherwise apply.
10 (2) The non-licensee is not entitled to recover by any means
(including, for example, set-off or a claim on a quantum meruit) any
brokerage, commission or other fee for which the client would, but for
this section, have been liable to the non-licensee under or in connection
with the agreement.
15 Onus of establishing non-application of section 179 or 180
181. For the purposes of determining, in a proceeding in a court,
whether or not the non-licensee is, or was at a particular time, entitled
as mentioned in section 179 (2) or 180 (2), it must be presumed, unless
the contrary is proved, that section 179 or 180, as the case requires,
20 applies, or applied at that time, as the case requires.
Client may recover commission paid to non-licensee
182. (1) Without limiting the generality of section 178, if the client
gives a notice under section 175, the client may, even if the notice does
not result under section 176 in rescission of the agreement, recover
25 from the non-licensee as a debt the amount of any brokerage,
commission or other fee that the client has paid to the non-licensee
under or in connection with the agreement.
(2) The SSA may, if it considers that it is in the public interest to
do so, bring an action under subsection (1) in the name of, and for the
30 benefit of, the client.
Remedies under this Subdivision
183. The client's rights under this Subdivision are additional to, and
do not prejudice, any right or remedy of the client.
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Subdivision 3 -- Representatives
Proper authority from society
184. A reference, in relation to a person (in this section called the
''representative'') to a proper authority from a society registered
5 under this Code or the Code of a participating State (in this section
called the ''principal'') is a reference to a document in the prescribed
form or a copy of the society's certificate of incorporation on which are
endorsed --
(a) a statement --
10 (i) stating that the representative is employed by, or acts
for or by arrangement with, the principal; and
(ii) signed by the principal; and
(b) in relation to each person (if any), other than the principal,
of whom the representative is a representative, a statement
15 that --
(i) sets out the name of the person; and
(ii) states that the representative is employed by, or acts
for or by arrangement with, that person; and
(iii) states that the person consents to the representative
20 being employed by, or acting for or by arrangement
with, the principal; and
(iv) is signed by the person.
Representatives of dealers
185. A person must not, in relation to benefits, do an act as a
25 representative of a licensed dealer unless the person holds a proper
authority from the dealer.
Maximum penalty: $2 500 or imprisonment for 6 months, or both.
Representatives of investment advisers
186. A person must not, in relation to benefits, do an act as a
30 representative of a licensed adviser unless the person holds a proper
authority from the licensed adviser.
Maximum penalty: $2 500 or imprisonment for 6 months, or both.
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Representatives of societies
187. A person must not, in relation to benefits, do an act as a
representative of a society unless the person holds a proper authority
from the society.
5 Maximum penalty: $2 500 or imprisonment for 6 months, or both.
Body corporate not to act as representative
188. A body corporate must not do an act as a representative of a
dealer, an investment adviser or a society.
Maximum penalty: $5 000 or imprisonment for 12 months, or both.
10 Defence
189. (1) A person does not contravene section 171, 172, 185, 186 or
187 by an act done by that person as a representative of another person
if --
(a) but for the other person ceasing to be a society or for the
15 revocation or suspension of a securities licence held by the
other person, the act would not have been such a
contravention;
(b) when he or she did the act, the first-mentioned person --
(i) believed in good faith that the other person was a
20 society or held the securities licence, as the case
requires; and
(ii) was unaware of the cessation, revocation or
suspension.
(2) A person does not contravene section 171, 172, 185, 186 or 187
25 by an act done by that person as a representative of another person if
the person holds what he or she believes in good faith to be a proper
authority from that other person, and in all the circumstances it was
reasonable for the first-mentioned person to so believe.
(3) In this section --
30 ''securities licence'' means an investment advisers licence
granted under Part 7.3 of the Corporations Law or a
dealers licence granted under that Part.
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Banned person not to act as representative
190. A person must not do an act as a representative of a society, a
licensed dealer or a licensed adviser if the person is the subject of a
banning order made by the Australian Securities Commission under
5 section 829 of the Corporations Law.
Maximum penalty: $2 500 or imprisonment for 6 months, or both.
Society to keep register of holders of proper authorities
191. (1) A society must establish a register of the persons who hold
proper authorities from the society and must keep it in accordance with
10 this section.
(2) The register must be in writing or in such other form as the
SSA approves.
(3) The register must contain, in relation to each person (if any)
who holds a proper authority from the society --
15 (a) a copy of the proper authority;
(b) the person's name;
(c) the person's current residential address;
(d) unless the person's current business address is the same as
the society's, the person's current business address; and
20 (e) any other prescribed information.
(4) A copy of a proper authority of a person from the society that
subsection (3) provides for the register to contain must be included in
the register within 2 business days after the person begins to hold that
proper authority.
25 (5) Information that subsection (3) provides for the register to
contain in relation to a person must be entered in the register within
2 business days after --
(a) the person begins to hold a proper authority from the
society; or
30 (b) the society receives the information,
whichever happens later.
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(6) Within 2 business days after a person ceases to hold a proper
authority from the society, the society must --
(a) in any case --
(i) include, in a part of the register separate from the
5 part in which copies of proper authorities are
included under subsection (4); and
(ii) remove from the last-mentioned part,
the copy of the proper authority that was included in the
last-mentioned part; and
10 (b) unless, at the end of those 2 business days, the person
again holds a proper authority from the society --
(i) enter, in a part of the register separate from the part
in which information is entered under subsection (5);
and
15 (ii) remove from the last-mentioned part,
the information that has been entered in the last-mentioned
part in relation to the person.
(7) Information that has been entered under subsection (6) (b) in a
separate part of the register is deemed for the purposes of subsections
20 (3) and (5) not to be contained or entered in the register.
(8) Where a society that subsection (1) requires to establish a
register already keeps one under this section or a corresponding
previous law, the society need not establish a new register but must
keep the existing one in accordance with this section.
25 Society to notify SSA of location and contents of register
192. (1) In this section --
''register'', in relation to a society, means a register that the
society keeps for the purposes of section 191.
(2) Within 14 days after establishing a register, the society must
30 lodge with the SSA written notice of where the register is kept.
(3) As soon as practicable after changing the place where a
register is kept, the society must lodge with the SSA written notice of
the new place where the register is kept.
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(4) Within 2 business days after the day on which a person begins
to hold a particular proper authority from a society, the society must,
whether or not the person has previously held a proper authority from
the society, lodge with the SSA --
5 (a) a copy of the first-mentioned proper authority; and
(b) a written notice stating that the person began to hold that
proper authority on that day.
(5) The society must lodge with the SSA a written notice, within
the period provided by subsection (6) --
10 (a) setting out the information that the register is required to
contain by section 191 (3) (b), (c), (d) or (e); and
(b) stating that the information has been, or is to be, entered in
the register.
(6) A notice under subsection (5) must be lodged with the SSA
15 within the period within which subsection 191 (5) requires the
information to be entered in the register.
(7) Within 2 business days after a person ceases to hold a proper
authority from a society, the society must, unless at the end of those 2
business days the person again holds a proper authority from the
20 society, lodge with the SSA a written notice stating that the person has
ceased to hold such a proper authority.
Inspection and copying of register
193. (1) In this section --
''register'' in relation to a society, means a register that the
25 society keeps for the purposes of section 191.
(2) A society must ensure that a register is open for inspection
without charge.
(3) Where a person requests a society in writing to give to the
person a copy of the whole, or of a specified part, of a register, the
30 society must comply with the request within 2 business days after --
(a) if the society's rules require the person to pay for the copy,
an amount (if any) prescribed by the society's rules,
receiving the amount from the person; or
(b) in any other case, receiving the request.
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SSA may require production of authority
194. (1) Where the SSA has reason to believe that a person --
(a) holds a proper authority from a society; or
(b) has done an act as a representative of another person,
5 then, whether or not the SSA knows who the society or other person is,
it may require the first-mentioned person to produce any proper
authority or purported proper authority from the society that the first-
mentioned person holds.
(2) A person must not, without reasonable excuse, refuse or fail to
10 comply with a requirement under this section.
Maximum penalty: $2 500 or imprisonment for 6 months, or both.
SSA may give society information about representative
195. (1) Where the SSA believes on reasonable grounds that --
(a) a person (in this section called the ''holder'') holds, or will
15 hold, a proper authority from a society;
(b) having regard to that fact, the SSA should give to the
society particular information that the SSA has about the
person; and
(c) the information is true,
20 the SSA may give the information to the society.
(2) Where the SSA gives information under subsection (1), the SSA
or an officer of the SSA may, for a purpose connected with --
(a) the SSA making a decision about what action (if any) to
take in relation to the holder, having regard to, or to
25 matters including, the information; or
(b) the SSA taking action pursuant to such a decision,
or for 2 or more such purposes, and for no other purpose, give to
another person, make use of, or make a record of, some or all of the
information.
30 (3) A person to whom information has been given, in accordance
with subsection (2) or this subsection, for a purpose or purposes may,
for that purpose or one or more of those purposes, and for no other
purpose, give to another person, make use of, or make a record of, that
information.
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(4) Subject to subsections (2) and (3), a person must not give to
another person, make use of, or make a record of, information given by
the SSA under subsection (1).
Maximum penalty: $5 000 or imprisonment for 12 months, or both.
5 (5) A person has qualified privilege in respect of an act done by
the person as permitted by subsection (2) or (3).
(6) A person to whom information is given in accordance with this
section must not --
(a) give any of the information to a court; or
10 (b) produce in a court a document that sets out some or all of
the information,
except --
(c) for a purpose connected with --
(i) the society making a decision about what action (if
15 any) to take in relation to the holder, having regard
to, or to matters including, some or all of the
information; or
(ii) the society taking action pursuant to such a decision;
or
20 (iii) proving in a proceeding in that court that particular
action taken by the society in relation to the holder
was so taken pursuant to such a decision,
or for 2 or more such purposes, and for no other purpose; or
(d) in a proceeding in that court, in so far as the proceeding
25 relates to an alleged contravention of this section; or
(e) in a proceeding in respect of an ancillary offence relating to
an offence against this section; or
(f) in a proceeding in respect of the giving to a court of false
information being or including some or all of the first-
30 mentioned information.
(7) A reference in this section to a person taking action in relation
to another person is a reference to the first-mentioned person --
(a) taking action by way of making, terminating or varying the
terms and conditions of a relevant agreement; or
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(b) otherwise taking action in relation to a relevant agreement,
in so far as the relevant agreement relates to the other person being
employed by, or acting for or by arrangement with, the first-mentioned
person in connection with a business of dealing in benefits or a benefits
5 advisory business carried on by the first-mentioned person.
Holder of authority may be required to return it
196. (1) Where a person holds a proper authority from a society but
is neither employed by, nor authorized to act for or by arrangement
with, the society, the society may, by writing given to the person,
10 require the person to give the proper authority to the society within a
specified period of not less than 2 business days.
(2) A person must not, without reasonable excuse, refuse or fail to
comply with a requirement made of the person in accordance with
subsection (1).
15 Subdivision 3A -- Exemptions and modifications relating to
representatives
Exemptions and modifications under Subdivision 3
196A. (1) The SSA may, subject to and in accordance with the
standards, by writing, exempt a particular person or persons, or a
20 particular class of persons, either generally or as otherwise provided in
the exemption, and either unconditionally or subject to conditions (if
any) as are specified in the exemption, from compliance with all or any
of the provisions of Subdivision 3.
(2) Without limiting the generality of subsection (1), an exemption
25 under that subsection may relate to particular benefits or to a
particular class of benefits.
(3) A person must not contravene a condition to which an
exemption under subsection (1) is subject.
(4) Where a person has contravened a condition to which an
30 exemption under subsection (1) is subject, the Court may, on the
application of the SSA, order the person to comply with the condition.
(5) The SSA may, subject to and in accordance with the standards,
by writing, declare that Subdivision 3 has effect in its application to a
particular person or persons, or a particular class of persons, either
35 generally or as otherwise provided in the declaration as if a specific
provision or provisions of that Subdivision were omitted, modified or
varied in a manner specified in the declaration, and, where such a
declaration is made, that Subdivision has effect accordingly.
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(6) Without limiting the generality of subsection (5), a declaration
under that subsection may relate to particular benefits or to a
particular class of benefits.
(7) The SSA must cause to be published in the Gazette a statement
5 to the effect that an exemption has been granted or a declaration made
under this Subdivision in relation to a particular class of persons or a
particular class of benefit funds.
Subdivision 4 -- Liability of principals for representatives' conduct
Conduct engaged in as a representative
10 197. Where a person engages in conduct in relation to benefits as a
representative of another person (in this section called the
''principal''), then, as between the principal and a third person (other
than the SSA), the principal is liable in respect of that conduct in the
same manner, and to the same extent, as if the principal had engaged
15 in it.
Liability where identity of principal unknown
198. (1) This section applies for the purposes of a proceeding in a
court where --
(a) whether within or outside this State, a person (in this
20 section called the ''representative'') engages in particular
conduct in relation to benefits while the person is a
representative of 2 or more persons (in this section called
the ''indemnifying principals''); and
(b) it is proved for the purposes of the proceeding that the
25 representative engaged in the conduct as a representative
of some person (in this section called the ''unknown
principal'') but it is not proved for those purposes who the
unknown principal is.
(2) If only one of the indemnifying principals is a party to the
30 proceeding, he, she or it is liable in respect of that conduct as if he, she
or it were the unknown principal.
(3) If 2 or more of the indemnifying principals are parties to the
proceeding, each of those 2 or more is liable in respect of that conduct
as if he, she or it were the unknown principal.
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Liability of principals where act done in reliance on
representative's conduct
199. (1) This section applies where --
(a) at a time when a person (in this section called the
5 ''representative'') is a representative of only one person
(in this section called the ''indemnifying principal'') or of
2 or more persons (in this section called the ''indemnifying
principals''), the representative, whether within or outside
this State --
10 (i) engages in particular conduct in relation to benefits;
(ii) proposes, or represents that the representative
proposes, to engage in particular conduct in relation
to benefits;
(b) another person (in this section called the ''client'') does, or
15 omits to do, a particular act, whether within or outside this
State, because the client believes at a particular time in
good faith that the representative engaged in, or proposes
to engage in, as the case requires, that conduct --
(i) on behalf of some person (in this section called the
20 ''assumed principal'') whether or not identified, or
identifiable, at that time by the client; and
(ii) in connection with a business dealing in benefits or a
benefits advisory business carried on by the assumed
principal; and
25 (c) it is reasonable to expect that a person in the client's
circumstances would so believe and would do, or omit to do,
as the case requires, that act because of that belief,
whether or not that conduct is or would be within the scope of the
representative's employment by, or authority from, any person.
30 (2) If --
(a) subsection (1) (a) (i) applies; or
(b) subsection (1) (a) (ii) applies and the representative engages
in that conduct,
then, for the purposes of a proceeding in a court --
35 (c) as between the indemnifying principal and the client or a
person claiming through the client, the indemnifying
principal is liable; or
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(d) as between any of the indemnifying principals and the
client or a person claiming through the client, each of the
indemnifying principals is liable,
as the case requires, in respect of that conduct in the same manner,
5 and to the same extent, as if he, she or it had engaged in it.
(3) Without limiting the generality of subsection (2), the
indemnifying principal, or each of the indemnifying principals, as the
case requires, is liable to pay damages to the client in respect of any
loss or damage that the client suffers as a result of doing, or omitting to
10 do, as the case requires, the act referred to in subsection (1) (b).
(4) Subsection (3) does not apply unless --
(a) the conduct was engaged in, the proposed conduct would
have been engaged in, or the representation was made, in
this State; or
15 (b) the act referred to in subsection (1) (b) was done, or would
have been done, as the case requires, in this State; or
(c) some or all of the loss or damage was suffered in this State.
(5) If --
(a) there are 2 or more indemnifying principals;
20 (b) 2 or more of them are parties (in this subsection called the
''indemnifying parties'') to a proceeding in a court;
(c) it is proved for the purposes of the proceeding --
(i) that the representative engaged in that conduct as a
representative of some person; and
25 (ii) who that person is; and
(d) that person is among the indemnifying parties,
subsections (2) and (3) do not apply, for the purposes of the proceeding,
in relation to the indemnifying parties other than that person.
Presumptions about certain matters
30 200. (1) Where it is proved, for the purposes of a proceeding in a
court, that a person (in this subsection called the ''representative'')
engaged in particular conduct in relation to benefits, whether within or
outside this State, while the person was a representative of --
(a) only one person (in this subsection called the
35 ''indemnifying principal''); or
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(b) 2 or more persons (in this subsection called the
''indemnifying principals''),
then, unless the contrary is proved for the purposes of the proceeding, it
must be presumed for those purposes that the representative engaged
5 in the conduct as a representative of --
(c) the indemnifying principal; or
(d) as a representative of some person among the indemnifying
principals,
as the case requires.
10 (2) Where, for the purposes of establishing in a proceeding in a
court that section 199 applies, it is proved that a person did, or omitted
to do, a particular act because the person believed at a particular time
in good faith that certain matters were the case, then, unless the
contrary is proved for those purposes, it must be presumed for those
15 purposes that it is reasonable to expect that a person in the first-
mentioned person's circumstances would so believe and would do, or
omit to do, as the case requires, that act because of that belief.
No contracting out of liability for representative's conduct
201. (1) For the purposes of this section, a liability of a person --
20 (a) in respect of conduct in relation to benefits engaged in by
another person as a representative of the first-mentioned
person; or
(b) arising under section 199 because another person has
engaged in, proposed to engage in, or represented that the
25 other person proposed to engage in, particular conduct in
relation to benefits,
is a liability of the first-mentioned person in respect of the other person.
(2) Subject to this section, an agreement is void in so far as it
purports to exclude, restrict or otherwise affect a liability of a person in
30 respect of another person, or to provide for a person to be indemnified
in respect of a liability of the person in respect of another person.
(3) Subsection (2) does not apply in relation to an agreement in so
far as it --
(a) is a contract of insurance;
35 (b) provides for a representative of a person to indemnify the
person in respect of a liability of the person in respect of
the representative; or
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(c) provides for a licensed adviser, licensed dealer or society
from whom a person holds a proper authority to indemnify
another such adviser, dealer or society in respect of a
liability of the other authorized person in respect of the
5 person.
(4) A person must not make, offer to make, or invite another
person to offer to make, in relation to a liability of the first-mentioned
person in respect of a person, an agreement that is or would be void, in
whole or in part, by virtue of subsection (2).
10 Effect of Subdivision
202. (1) Where 2 or more persons are liable under this Subdivision
in respect of the same conduct or the same loss or damage, they are so
liable jointly and severally.
(2) Nothing in section 197, 198 or 199 --
15 (a) affects a liability arising otherwise than by virtue of this
Subdivision; or
(b) notwithstanding paragraph (a) of this subsection, entitles a
person to be compensated twice in respect of the same loss
or damage; or
20 (c) makes a person guilty of an offence.
Subdivision 5 -- Excluding persons from dealing with benefits
Power to make banning order
203. Subject to section 210, the SSA may make a banning order
against a person --
25 (a) if the person is a natural person and the person --
(i) becomes an insolvent under administration; or
(ii) is convicted of serious fraud within the meaning of
section 9 of the Corporations Law; or
(iii) becomes incapable, through mental or physical
30 incapacity, of managing his or her affairs;
(b) if the person is a body corporate and the person --
(i) ceases to carry on business; or
(ii) becomes an externally administered body corporate;
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(c) if the person contravenes a provision of Chapter 6 or
Chapter 7 of the Corporations Law or of this Part;
(d) if the SSA has reason to believe that the person (in the case
of a natural person) or an officer of the person (in the case
5 of a body corporate) is not of good fame and character; or
(e) if the SSA has reason to believe that the person has not, or
will not, perform efficiently, honestly and fairly the duties
of a licensed dealer, a licensed adviser or the holder of a
proper authority from a licensed dealer, a licensed adviser
10 or a society, as the case requires, in relation to the conduct
of a business of dealing in benefits or a benefits advisory
business.
Nature of banning order
204. (1) Where this Subdivision empowers the SSA to make a
15 banning order against a person, the SSA may, by written order,
prohibit the person, permanently or for a specified period, from doing
an act in connection with the conduct of a business of dealing in
benefits or a benefits advisory business.
(2) The SSA must not vary or revoke a banning order except under
20 section 205, 206 or 207.
Exceptions to banning order
205. (1) An order made against a person under section 204 (1) may
include a provision that permits the person, subject to such conditions
(if any) as are specified, to do, or to do in specified circumstances,
25 specified acts that the order would otherwise prohibit the person from
doing.
(2) Subject to section 210 the SSA may, at any time, by written
order, vary a banning order against a person --
(a) by adding a provision that permits the person as mentioned
30 in subsection (1);
(b) by varying such a provision in relation to conditions,
circumstances or acts specified in the provision;
(c) by omitting such a provision and substituting another such
provision; or
35 (d) by omitting such a provision.
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Variation or revocation of banning order on application
206. (1) Subject to section 207 and 210, this section has effect
where a person applies to the SSA to vary or revoke a banning order
relating to the person.
5 (2) If --
(a) the person is not an insolvent under administration or an
externally administered body corporate; and
(b) the SSA has no reason to believe that the person, or an
officer of the person, is not of good fame and character; and
10 (c) the SSA has no reason to believe that the person will not
perform efficiently, honestly and fairly the duties of a
licensed dealer, a licensed adviser or the holder of a proper
authority from a licensed dealer, a licensed adviser or a
society, as the case requires,
15 the SSA must by written order --
(d) if paragraph (c) applies, vary the banning order so that it
no longer prohibits the person from doing an act in
connection with the conduct of a business of dealing in
benefits or a benefits advisory business;
20 (e) in any other case, revoke the banning order.
(3) Otherwise, the SSA must refuse the application.
(4) In determining whether or not it has reason to believe as
mentioned in subsection (2) (b) or (c), the SSA must have regard to any
conviction of any relevant person, during the 10 years ending on the
25 day of the application, of serious fraud within the meaning of section 9
of the Corporations Law.
(5) Nothing in subsection (4) limits the matters to which the SSA
may have regard --
(a) in deciding the application; or
30 (b) in connection with performing or exercising any other
function or power under this Part.
Revocation of banning order in certain cases
207. Where --
(a) section 206 requires the SSA to vary a banning order so
35 that it no longer has a particular operation; and
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(b) the order has no other operation,
the SSA must, by written order, instead revoke the banning order.
Effect and publication of orders under this Subdivision
208. (1) An order by the SSA under this Subdivision takes effect
5 when served on the person to whom the order relates.
(2) As soon as practicable on or after the day on which an order by
the SSA under this Subdivision takes effect, the SSA must publish in
the Gazette a notice that sets out a copy of --
(a) if the order is made under section 204 or revokes a banning
10 order, the first-mentioned order; or
(b) if the order varies a banning order, the banning order as in
force immediately after the first-mentioned order takes
effect,
and states that the first-mentioned order, or the banning order as so in
15 force, as the case requires, took effect on that day.
(3) Where --
(a) but for this subsection, subsection (2) would require
publication of a notice setting out a copy of a banning order
as in force at a particular time;
20 (b) the banning order as so in force includes a provision that
permits a person as mentioned in section 205 (1); and
(c) in the SSA's opinion, the notice would be unreasonably long
if it set out a copy of the whole of that provision,
the notice may, instead of setting out a copy of that provision, set out a
25 summary of the provision's effect.
Contravention of banning order
209. A person must not contravene a banning order relating to the
person.
Maximum penalty: $2 500 or imprisonment for 6 months, or both.
30 Opportunity for hearing
210. (1) The SSA must not --
(a) make, otherwise than by virtue of section 203 (a), (b) or (c),
an order under section 204 against a person;
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(b) make under section 205 (2) an order varying a banning
order against a person; or
(c) refuse an application by a person under section 206,
unless the SSA complies with subsection (2) of this section.
5 (2) The SSA must give the person an opportunity --
(a) to appear at a hearing before the SSA that takes place in
private; and
(b) to make submissions and give evidence to the SSA in
relation to the matter.
10 Disqualification by the Court
211. (1) Where the SSA makes under section 204 against a person
an order that is to operate otherwise than only for a specified period,
the SSA may apply to the Court for an order or orders under this
section in relation to the person.
15 (2) On an application under subsection (1), the Court may make
one or more of the following --
(a) an order prohibiting the person, permanently or for a
specified period, from doing an act in connection with the
conduct of a business of dealing in benefits or a benefits
20 advisory business;
(b) such other order as it thinks fit,
or may refuse the application.
(3) The Court may revoke or vary an order in force under
subsection (2).
25 Subdivision 6 -- Recommendations about benefits
Definition of adviser
212. In this Subdivision --
''adviser'' means --
(a) a licensed dealer;
30 (b) a licensed adviser;
(c) a person holding a proper authority from a licensed
dealer, a licensed adviser or a society.
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Recommendation made by partner or officer
213. For the purposes of this Subdivision (other than section 216) --
(a) a recommendation made by a partner is deemed to have
been made by each partner in the partnership; and
5 (b) a recommendation made by a director, executive officer or
secretary of a body corporate is deemed to have also been
made by the body corporate.
Client to be told if adviser's interests may influence
recommendation
10 214. (1) This section applies where an adviser makes a
recommendation with respect to benefits, whether express or implied, to
a person (in this section called the ''client'') who may reasonably be
expected to rely on it.
(2) The adviser must --
15 (a) if the recommendation is made orally, when making the
recommendation, disclose to the client orally; or
(b) if the recommendation is made in writing, set out in that
writing, in such a way as to be no less legible than the
other material in that writing,
20 particulars of --
(c) any commission or fee, or any other benefit or advantage,
whether pecuniary or not and whether direct or indirect,
that the adviser or an associate of the adviser (other than a
society) has received, or will or may receive, in connection
25 with the making of the recommendation or an application
by the client for benefits or a contribution by the client to a
benefit fund, as a result of the recommendation; and
(d) any other pecuniary or other interest, whether direct or
indirect, of the adviser or an associate of the adviser, (other
30 than a society) that may reasonably be expected to be
capable of influencing the adviser in making the
recommendation.
Maximum penalty: $2 500 or imprisonment for 6 months, or both.
(3) Subsection (2) does not apply in relation to a commission or fee
35 that the adviser has received, or will or may receive, from the client.
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(4) If, by making the recommendation, the adviser does an act as a
representative of another person (other than a society), then --
(a) without limiting the generality of section 4 (2), the other
person is an associate for the purposes of subsection (2) of
5 this section; and
(b) subsection (2) does not apply in relation to a commission or
fee that the other person has received, or will or may
receive, from the client.
(5) For the purposes of section 4 (2), the making of
10 recommendations with respect to benefits, whether express or implied,
is the matter to which a reference to an associate in subsection (2) of
this section relates.
(6) Despite section 4 (2) and subsection (5) of this section, a person
(in this subsection called the ''alleged associate'') is not an associate
15 for the purposes of subsection (2) of this section merely because of
being --
(a) a partner of the adviser otherwise than because of carrying
on a business of dealing in benefits in partnership with the
adviser; or
20 (b) a director of a body corporate of which the adviser is also a
director, whether or not the body carries on a business of
dealing in benefits,
unless the adviser and the alleged associate act jointly, or otherwise act
together, or under an arrangement between them, in relation to making
25 recommendations, whether express or implied, with respect to benefits.
Defences to alleged breach of section 214 (2)
215. (1) Where --
(a) a person --
(i) when making a recommendation orally, fails to
30 disclose; or
(ii) when making a recommendation in writing, fails to
set out in that writing,
as required by section 214 (2), particulars of a matter; and
(b) it is proved that the person was not, and could not
35 reasonably be expected to have been, aware of that matter
when making the recommendation,
the failure is not a contravention of section 214 (2).
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(2) Where --
(a) an adviser --
(i) when making a recommendation orally, fails to
disclose; or
5 (ii) when making a recommendation in writing, fails to
set out in that writing,
as required by section 214 (2), particulars of a matter;
(b) in the case of a person holding a proper authority from a
licensed dealer, a licensed adviser or a society, by making
10 the recommendation, the representative does an act as a
representative of the licensed dealer, licensed adviser or a
society;
(c) it is proved that the licensed dealer, licensed adviser or
society, had in operation, throughout a period beginning
15 before the decision to make the recommendation was made
and ending after the recommendation was made,
arrangements to ensure that --
(i) the natural person who made the decision knew
nothing about that matter before the end of that
20 period; and
(ii) no advice with respect to the making of the
recommendation was given to the person by anyone
who knew anything about that matter; and
(d) it is also proved that --
25 (i) the person in fact knew nothing about that matter
before the end of that period; and
(ii) no such advice was so given,
the failure is not a contravention of section 214 (2).
(3) Neither of subsections (1) and (2) limits the generality of the
30 other.
Adviser must have reasonable basis for recommendation
216. (1) An adviser who --
(a) makes a recommendation, whether express or implied, with
respect to benefits to a person who may reasonably be
35 expected to rely on it; and
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(b) does not have a reasonable basis for making the
recommendation to the person,
contravenes this section.
(2) For the purposes of subsection (1), an adviser does not have a
5 reasonable basis for making a recommendation to a person unless --
(a) in order to ascertain that the recommendation is
appropriate having regard to the information the adviser
has about the person's investment objectives, financial
situation and particular needs, the adviser has given such
10 consideration to, and conducted such investigation of, the
subject matter of the recommendation as is reasonable in
all the circumstances; and
(b) the recommendation is based on that consideration and
investigation.
15 (3) An adviser who contravenes subsection (1) is not guilty of an
offence.
Adviser who breaches this Subdivision liable to compensate
client
217. (1) This section applies where --
20 (a) an adviser contravenes section 214 or 216 in relation to a
recommendation (whether express or implied) with respect
to benefits to a person (in this section called the ''client'');
(b) the client, in reliance on the recommendation, does, or
omits to do, a particular act;
25 (c) it is reasonable, having regard to the recommendation and
all other relevant circumstances, for the client to do, or omit
to do, as the case requires, that act in reliance on the
recommendation; and
(d) the client suffers loss or damage as a result of that act or
30 omission.
(2) Subject to subsections (3) and (4), the adviser is liable to pay
damages to the client in respect of that loss or damage.
(3) In the case of a contravention of section 214, the adviser is not
so liable if it is proved that a reasonable person in the client's
35 circumstances could be expected to have done, or omitted to do, as the
case requires, that act in reliance on the recommendation even if the
adviser had complied with that section in relation to the
recommendation.
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(4) In the case of a contravention of section 216, the adviser is not
so liable if it is proved that the recommendation was, in all the
circumstances, appropriate having regard to the information that, when
making the recommendation, the adviser had about the client's
5 investment objectives, financial situation and particular needs.
Qualified privilege for adviser when complying with this
Subdivision
218. An adviser who --
(a) makes a recommendation in relation to benefits to a person
10 who may reasonably be expected to rely on it; and
(b) in so making the recommendation, contravenes neither of
sections 214 (2) and 216 (1),
has qualified privilege in respect of a statement the adviser makes to
the person, whether orally or in writing, in the course of, or in
15 connection with, so making the recommendation.
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PART 5 -- SHARES AND CHARGES
Division 1 -- Shares Generally
Share capital
219. A society may issue permanent shares or redeemable preference
5 shares in accordance with this Part.
Classes of shares, rights etc.
220. (1) The rules of a society may provide for the division of the
society's share capital into classes of shares.
(2) All shares in a class of shares must have the same nominal
10 value.
(3) The rights attaching and terms and conditions of issue
applying to a class of shares are as provided in the society's rules or
determined by the board under the rules, but no such rules may be
registered unless the provisions in relation to those rights, terms and
15 conditions comply with the requirements of this Code and are, in the
SSA's opinion, otherwise appropriate.
Determination of share capital
221. The amount of the share capital of a society is the aggregate of
the nominal values of the shares that have been issued by the society.
20 Liability of shareholders
222. The liability of a shareholder in a society in relation to a share
is limited to the amount (if any) unpaid in relation to the share.
Board to approve sale or transfer unless rules provide
otherwise
25 223. Unless a society's rules otherwise provide, a share in the society
may be transferred only with the consent of the society.
Restriction on application of capital
224. (1) Except as provided by section 225, a society must not
apply any of its shares or capital money either directly or indirectly
30 in --
(a) making a payment to a person in consideration of the
person's subscribing or agreeing to subscribe (whether
absolutely or conditionally); or
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(b) procuring or agreeing to procure subscriptions (whether
absolute or conditional),
for any permanent shares in the society (whether the shares are or the
money is so applied by being added to the purchase price of property
5 acquired by the society or to the contract price of work to be executed
for the society or the money is paid out of the nominal purchase price or
contract price or otherwise).
(2) If a society contravenes subsection (1), any officer of the society
who is in default commits an offence.
10 Maximum penalty: $25 000.
(3) If --
(a) a person is convicted of an offence against subsection (2) in
relation to a society; and
(b) the court by which the person is convicted is satisfied that
15 the society has suffered loss or damage because of the act
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 society.
(4) The order may be enforced as if it were a judgment of that
20 court.
(5) If a contravention of subsection (1) takes place and --
(a) a person (other than the society concerned) who was, at the
time of the contravention, aware of the matters constituting
the contravention, made a profit because of the
25 contravention, the society may (whether or not the person
or another person has been convicted of an offence against
subsection (2) in relation to the contravention) recover the
profit from the person as a debt due to the society by action
in a court having jurisdiction for the recovery of debts up to
30 the amount concerned; and
(b) the society concerned has suffered loss or damage because
of the contravention, the society may recover the loss or
damage from a person who is in default (whether or not the
person or another person has been convicted of an offence
35 against subsection (2) in relation to the contravention) as a
debt due to the society by action in a court having
jurisdiction for the recovery of debts up to the amount
concerned.
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Power to make certain payments
225. (1) Subject to subsection (2), a society may make a payment
by way of brokerage or commission to a person in consideration of --
(a) the person's subscribing or agreeing to subscribe (whether
5 absolutely or conditionally) for shares in the society; or
(b) procuring or agreeing to procure subscriptions (whether
absolute or conditional) for shares in the society,
only if --
(c) the payment is not prohibited by the society's rules; and
10 (d) the amount of the proposed payment, or the rate at which
the payment is proposed to be made, is disclosed in a
prospectus issued in relation to the shares or, if there is no
such prospectus, in a statement lodged with the SSA before
the society becomes liable to make the payment; and
15 (e) the number of shares for which persons have agreed, for a
payment by way of brokerage or commission, to subscribe
absolutely is set out in the prospectus or statement.
(2) The total amount of payments by a society by way of brokerage
or commission for shares must not be more than the lesser of the
20 following amounts --
(a) 10% of the total amount payable on allotment of the shares;
(b) if the society's rules specify an amount, or a rate for
calculating an amount, for the purpose, the amount
specified or calculated in accordance with the specified rate.
25 (3) A vendor to, promoter of, or person who receives payment in
money or shares from, a society may apply any part of the money or
shares in making a payment that would, if it were made directly by the
society, be lawful under this section.
Validation of shares improperly issued
30 226. (1) If a society has purported to issue shares and --
(a) the creation or issue of the shares is invalid under this
Code or the society's rules or for any other reason; or
(b) the terms of the purported issue are inconsistent with or
are not authorized by this Code or the rules,
35 the Court may, on application made by the society, a holder or
mortgagee of any of the shares, or a creditor of the society, and, on
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being satisfied that in all the circumstances it is just and equitable to
do so, make an order under this section.
(2) An order under this section may --
(a) validate the purported issue of the shares; or
5 (b) confirm the terms of the purported issue of the shares; or
(c) do both those things.
(3) On an office copy of an order made under this section being
lodged with the SSA, the shares to which the order relates are taken to
have been validly issued on the terms of the issue of the shares.
10 Division 2 -- Permanent Shares
Issue of permanent shares
227. (1) Permanent shares in a society may be issued as fully paid-
up shares or shares to be paid for by periodical or other subscription or
at call.
15 (2) If the rules of a society provide for the issue of permanent
shares of different classes, the rules must provide that each class of
permanent shares ranks equally with the other classes of permanent
shares in relation to the return of capital and any distribution of
surplus assets and profits in the winding-up of the society.
20 Issue of preference shares
228. (1) Without limiting section 220, a society may issue
preference shares as a class of permanent shares.
(2) The SSA may, by Gazette notice, declare that specified
preference shares issued by a society are a class of permanent shares.
25 (3) A declaration has effect for the purposes of the application of
this Code to the shares to which the declaration relates.
Rights of holders of preference shares to be set out in rules
229. A society must not allot a preference share, or convert an issued
share into a preference share, unless its rules set out the rights of the
30 holder of the share in relation to --
(a) repayment of capital; and
(b) participation in surplus assets and profits; and
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(c) cumulative or non-cumulative dividends; and
(d) voting; and
(e) priority of payment of capital and dividend,
in relation to other shares or other classes of preference shares.
5 Cancellation of permanent shares
230. (1) Subject to section 237, issued or unissued permanent
shares in a society may not be cancelled by the society except --
(a) under its rules and with the approval of the SSA; or
(b) under a provision of this Code other than this section.
10 (2) If the SSA gives approval to the cancellation of permanent
shares in a society, the SSA may attach conditions to the approval and
may, on non-compliance with a condition of the approval, revoke the
approval.
(3) Without limiting subsection (2), the SSA may impose
15 conditions on the cancellation of permanent shares in a society to the
effect of the permitted buy-back procedures set out in Division 4B of
Part 2.4 of the Corporations Law as if --
(a) a reference in that Division to a company were a reference
to the society; and
20 (b) a permitted buy-back in accordance with that Division were
the procedure leading to cancellation of the permanent
shares under subsection (1).
(4) Subject to subsection (5), a society must not cancel a
permanent share if the result of taking such action would be that the
25 society fails to satisfy, or is in breach of, a standard.
(5) Despite any other provision of this Code, a society must cancel
any permanent share that is forfeited to the society under this Code or
its rules and is not required by this Code to be sold.
Dividends in relation to permanent shares
30 231. (1) In this section --
''dividend'' includes a payment by way of bonus share issue.
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(2) A society may, if authorized by its rules and the board so
determines, in relation to a particular class of permanent shares,
distribute profits by way of dividends or bonus shares (whether fully or
partly paid-up) to the holders of the permanent shares.
5 (3) Dividends or bonus share issues in relation to permanent
shares may vary in value proportionately according to the extent to
which each permanent share in relation to which the payment or issue
is made is paid up.
(4) A society commits an offence if dividends are paid otherwise
10 than --
(a) out of profits of the management fund of the society; or
(b) out of a share premium account maintained by the society
under this Division.
Maximum penalty: $75 000.
15 (5) If dividends are paid in contravention of subsection (4), the
creditors of the society are entitled to recover from any officer of the
society who knowingly caused or permitted the payment to be made the
amount of the debts owed by the society to those creditors respectively
to the extent that the dividends so paid have exceeded profits.
20 (6) If the whole amount is recovered from one officer, that officer
may recover contribution from any other officer similarly liable.
(7) A liability imposed on an officer under this section is
extinguished on the person's death.
Requirements for issue of permanent shares
25 232. (1) A society must not issue permanent shares unless
expressly authorized by its rules.
(2) If a society proposes to adopt rules that authorize the issue of
permanent shares, the society must first submit the rules to the SSA
for approval under this section.
30 (3) The SSA may approve rules for the issue by a society of
permanent shares if the SSA is satisfied that --
(a) the rules make appropriate provision for the reasonable
apportionment of reserves and profits of the society among
different classes of members or shareholders; and
35 (b) there would be, on winding-up of the society, a reasonable
apportionment of reserves and profits among different
classes of members or shareholders.
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(4) A society, in issuing permanent shares in accordance with its
rules, must comply with this Code and the standards.
Allotment of permanent shares otherwise than for cash
233. (1) For the purposes of this section, the issue of permanent
5 shares under a dividend reinvestment plan, or the issue of bonus shares
paid for out of the share premium account under section 240, is not an
issue of permanent shares otherwise than in consideration of payment
in cash.
(2) A society must not allot permanent shares as fully or partly
10 paid-up otherwise than in consideration of payment in cash unless the
society has obtained a report from an expert, signed by the expert and
stating --
(a) what, in the expert's opinion, is the money value, at the
time of the signing of the report, of the consideration given
15 in relation to the shares; and
(b) whether or not, in the expert's opinion, the consideration is
fair and reasonable as at that time and the reasons for the
opinion; and
(c) particulars of any relationship that the expert has with the
20 society or an associate of the society; and
(d) particulars of any pecuniary or other interest that the
expert has that could reasonably be regarded as being
capable of affecting the expert's ability to give an unbiased
report; and
25 (e) particulars of any fee or pecuniary or other benefit, whether
direct or indirect, that the expert has received, or will or
may receive, for or in connection with the making of the
report.
(3) A copy of a report under subsection (2) must be lodged with the
30 SSA by the society not less than 7 days before the shares are allotted.
(4) The society must, if it has obtained the opinions of more than
one expert for the purposes of this section, attach to any report that is
dealt with under subsection (3) a statement setting out, in relation to
each of the experts (other than the one who signed the report) --
35 (a) the name of the expert; and
(b) particulars of the opinion (if any) expressed by the expert
on the matters on which an expert's opinion is required for
the purposes of this section.
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(5) A society that contravenes this section commits an offence and
is liable on conviction to a maximum penalty of $25 000.
Power to exempt in relation to non-cash consideration
234. (1) The SSA may, by written notice, exempt a society,
5 conditionally or unconditionally, from a requirement of section 233.
(2) The SSA may, on non-compliance with a condition of an
exemption under this section, by written notice, revoke the exemption.
Differences in calls, reserve liability etc.
235. (1) A society may, if authorized by its rules --
10 (a) make arrangements on the issue of permanent shares for
varying the amounts and times of payment of calls as
among shareholders; and
(b) accept from a shareholder the whole or a part of the
amount remaining unpaid on any permanent shares
15 although no part of that amount has been called-up.
(2) A society may, by special resolution, determine that any
proportion of its permanent share capital that has not been already
called-up is not capable of being called-up except in the event and for
the purposes of the society being wound-up, but the resolution does not
20 prejudice any rights acquired by a person before the passing of the
resolution.
Calls and effect of non-compliance with calls on permanent
shares
236. (1) Calls on permanent shares in a society must be so made
25 that they are payable not less than 14 days from the day on which the
call is made, and no subsequent call may be made within 7 days from
the day on which the call was made immediately before it is payable.
(2) When a call is made, notice of the amount of the call, of the
day when it is payable and of the place for payment must, not less than
30 7 days before the day, be sent by post to the holder of shares on which
the call is made.
(3) If a call on a share is not paid on or before the day for its
payment, the shareholder is not entitled --
(a) to any dividend declared on the share after the day for
35 payment and before the day the call is paid; or
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(b) while the call remains unpaid, to a vote for the share in
any meeting of members of the society.
(4) If a call on a share is unpaid at the end of 14 days after the
day for its payment, the share may be forfeited by resolution of the
5 board.
Sale of permanent shares forfeited for non-payment of call
237. (1) Permanent shares forfeited to a society for non-payment of
a call must be offered for sale not more than 6 weeks after their
forfeiture --
10 (a) by auction; or
(b) on a stock market lawfully operated by a stock exchange
(within the meaning of paragraph (c) of the definition of
''stock exchange'' in section 9 of the Corporations Law).
(2) The rules of a society must provide for --
15 (a) the procedure to be followed in the conduct of the auction;
and
(b) the application of the proceeds of sale of the forfeited
shares.
Prohibition of allotment unless minimum subscription received
20 238. (1) A society must not make an allotment of permanent shares
in the society that have been offered for subscription or in relation to
which an invitation to subscribe has been issued unless --
(a) the minimum subscription (if any) has been subscribed; and
(b) the sum payable on application for the subscribed shares
25 has been received by the society.
(2) For the purposes of subsection (1), if a society has received a
cheque or payment order for the sum payable on application for an
allotment of shares in the society, the sum is not taken to have been
received by the society until the cheque is paid by the bank on which it
30 is drawn or payment is made in accordance with the order.
(3) In ascertaining for the purposes of subsection (1) whether the
minimum subscription has been subscribed in relation to an allotment
of shares, an amount equal to the sum of --
(a) the nominal value of each share; and
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(b) if the share is, or is to be, issued at a premium, the amount
of the premium payable on each share,
less any amount payable otherwise than in cash is taken to have been
subscribed in relation to each share for the allotment of which an
5 application has been made.
(4) If the conditions mentioned in subsection (1) have not been
satisfied within 4 months after the issue of the prospectus, the society
must repay, under this section, all money received from applicants for
shares.
10 (5) If a society is liable, under subsection (4), to repay money
received from applicants for shares --
(a) the money must be repaid without interest within 7 days
after the society becomes liable; and
(b) if the money is not repaid within the period --
15 (i) the directors of the society are, subject to subsection
(6), jointly and severally liable to repay the money
with interest at the prescribed rate calculated from
the end of the period; and
(ii) each director of the society commits an offence for
20 which the director is liable on conviction to a
maximum penalty of $5 000.
(6) A director of a society is not liable under subsection (5) (b) (i),
and does not commit an offence against subsection (5) (b) (ii), if it is
proved that the default in the repayment of the money was not due to
25 any misconduct or negligence on the director's part.
(7) An allotment made by a society to an applicant in
contravention of this section is voidable at the option of the applicant
and is voidable even if the society is being wound-up.
(8) An option mentioned in subsection (7) is exercisable by written
30 notice served on the society within one month after the date of the
allotment.
(9) A director of a society who knowingly contravenes, or permits
or authorizes the contravention of, any of the provisions of this section
(other than subsection (5)) commits an offence and is liable, in addition
35 to the penalty for the offence, to compensate the society and any person
to whom an allotment has been made in contravention of this section
respectively for any loss, damages or expenses that the society or the
person has sustained or incurred because of the allotment.
Maximum penalty: $5 000.
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(10) A proceeding for the recovery of compensation under
subsection (9) must be started within 2 years after the date of the
allotment.
(11) Any condition requiring or binding an applicant for shares to
5 waive compliance with any requirement of this section, or purporting to
do so, is void.
Return as to allotments
239. (1) If a society makes an allotment of its permanent shares,
the society must, within one month after the allotment is made, lodge
10 with the SSA a return, in accordance with the regulations, stating --
(a) the number and nominal values of the shares comprised in
the allotment; and
(b) the amount (if any) paid or due and payable on the
allotment of each share; and
15 (c) if the capital of the society is divided into shares of
different classes, the class of shares to which each share
comprised in the allotment belongs; and
(d) subject to subsection (3), the full name, or the surname and
at least one given name and initials, and the address of
20 each of the allottees and the number and class of shares
allotted to the person.
(2) A society that --
(a) has more than 500 members; and
(b) keeps its register of holders of permanent shares at a place
25 within 25 kilometres of an office of the SSA; and
(c) provides at that office reasonable accommodation and
facilities for persons to inspect and take copies of its
register of holders of permanent shares,
is not required to comply with the provisions of this Part and of the
30 regulations made for the purposes of this Part in so far as they relate to
the inclusion in the annual return of a list of members and particulars
of shares.
(3) The particulars mentioned in subsection (1) (d) need not be
included in a return in relation to shares that have been allotted in
35 consideration of the payment of money.
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(4) If shares in a society are allotted as fully or partly paid-up
otherwise than in consideration of the payment of money and the
allotment is made under a written contract, the society must lodge with
the return the contract evidencing the entitlement of the allottee or a
5 certified copy of any such contract.
(5) If a certified copy of a contract is lodged under subsection (4),
the original contract duly stamped must be produced at the same time
to the SSA.
(6) If shares in a society are allotted as fully or partly paid-up
10 otherwise than in consideration of the payment of money and the
allotment is made --
(a) under a contract not reduced to writing; or
(b) under the society's rules; or
(c) in satisfaction of a dividend declared in favour of, but not
15 payable in cash to, the shareholders; or
(d) under the application of money held by the society in an
account or reserve in paying up or partly paying up
unissued shares to which the shareholders have become
entitled,
20 the society must lodge with the return a statement containing such
particulars as are prescribed.
(7) For the purposes of this section, any shares in a society applied
for prior to the registration of the society are taken to have been
allotted on the date of registration of the society.
25 Issue of permanent shares at premium
240. (1) If a society issues permanent shares for which a premium
is received by the society (whether in money or in the form of other
valuable consideration) the aggregate amount or value of the premiums
on the permanent shares must be transferred to an account called the
30 ''share premium account'', and the provisions of this Part relating to the
reduction of the share capital of a society apply, subject to this section,
as if the share premium account were paid-up share capital of the
society.
(2) The share premium account may be applied --
35 (a) in paying-up shares to be issued to members of the society
as fully paid bonus shares; or
(b) in paying-up, in whole or in part, the balance unpaid on
shares previously issued to members of the society; or
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(c) in the payment of dividends, if those dividends are satisfied
by the issue of shares to members of the society; or
(d) in writing-off the preliminary expenses of the society; or
(e) in writing-off the expenses of, or the payment made in
5 relation to, any issue of shares in the society; or
(f) in providing for the premium payable on redemption of
redeemable preference shares.
Special resolution for reduction of permanent share capital
241. (1) Subject to confirmation by the Court, a society may, if
10 authorized by its rules, by special resolution reduce its permanent
share capital in any way and, in particular, may do all or any of the
following --
(a) extinguish or reduce the liability on any of its permanent
shares in relation to share capital not paid-up;
15 (b) cancel any paid-up share capital that is lost or is not
represented by available assets;
(c) pay off any paid-up share capital that is in excess of the
society's needs.
(2) If the proposed reduction of permanent share capital involves
20 either diminution of liability in relation to unpaid share capital or the
payment to any shareholder of any paid-up share capital, and in any
other case if the Court so directs --
(a) every creditor of the society who, at the date fixed by the
Court, is entitled to any debt or claim that, if that date
25 were the date of starting the winding-up of the society,
would be admissible in evidence against the society, is
entitled to object to the reduction; and
(b) the Court, unless satisfied on affidavit that there are no
such creditors, must settle a list of the names of creditors
30 entitled to object and, for that purpose, must ascertain as
far as possible, without requiring an application from any
creditor, the names of those creditors and the nature and
amount of their debts or claims, and may publish notices
fixing a final day on or before which creditors whose names
35 are not entered on the list may claim to be so entered; and
(c) if a creditor whose name is entered on the list, and whose
debt has not been discharged or whose claim has not been
determined, does not consent to the reduction, the Court
may dispense with the consent of the creditor on the society
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securing payment of the creditor's debt or claim by
appropriating as the Court directs --
(i) if the society admits the full amount of the debt or
claim or, though not admitting it, is willing to provide
5 for it, the full amount of the debt or claim; or
(ii) if the society does not admit and is not willing to
provide for the full amount of the debt or claim or if
the amount is contingent or not ascertained, an
amount fixed by the Court after inquiry and
10 adjudication of the kind required where a society is
wound-up by the Court.
(3) The Court may, having regard to any special circumstances of
a case, direct that all or any of the provisions of subsection (2) do not
apply in relation to creditors included in a particular class of creditors.
15 (4) The Court may, if satisfied that in relation to each creditor
who under subsection (2) is entitled to object --
(a) the creditor's consent to the reduction has been obtained; or
(b) the creditor's debt has been discharged or secured; or
(c) the creditor's claim has been determined or has been
20 secured,
make an order confirming the reduction on such terms and conditions
as it considers appropriate.
(5) A society must not act on a resolution for the reduction of
permanent share capital before application is made to the SSA for
25 registration of the resolution and an office copy of the order of the Court
is lodged with the SSA, but a resolution may specify an earlier date
(not earlier than the date of the resolution) as the date from which the
reduction of capital is to have effect.
(6) A certificate of the SSA stating that the resolution and an
30 office copy of the order made under subsection (4) have been registered
by the SSA is conclusive evidence that all the requirements of this Code
relating to the reduction of permanent share capital have been complied
with in relation to the society.
(7) A shareholder or former shareholder in a society is not liable,
35 in relation to any share in the society, to any call or contribution of
more than the difference (if any) between the amount of the share as
fixed by an order made under subsection (4) and the amount paid, or
the reduced amount (if any) that is taken to have been paid, on the
share.
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(8) Despite any other provision of this Code, if the name of a
creditor who is entitled under subsection (2) to object to a reduction is,
because of the creditor's ignorance of the proceeding for reduction or of
its nature and effect in relation to the creditor's claim, not entered on
5 the list of creditors and, after the reduction, the society is unable,
within the meaning of the provisions relating to winding-up by the
Court, to pay the amount of the creditor's debt or claim --
(a) every person who was a shareholder of the society at the
date of the registration of the copy of the order for
10 reduction is liable to contribute for the payment of the debt
or claim an amount not more than the amount that the
person would have been liable to contribute if the society
had started to be wound-up on the day before that date;
and
15 (b) if the society is wound-up, the Court, on the application of
any such creditor and proof of the creditor's ignorance of
the proceeding for reduction or of its nature and effect in
relation to the creditor's claim, may settle accordingly a list
of the names of persons liable to contribute because of
20 paragraph (a) and make and enforce calls and orders on the
contributories whose names are included in the list as if
they were ordinary contributories in a winding-up,
but nothing in this subsection affects the rights of the contributories
among themselves.
25 (9) An officer of a society who --
(a) knowingly conceals the name of a creditor entitled to object
to a reduction in the permanent share capital of the society;
or
(b) knowingly misrepresents the nature or amount of the debt
30 or claim of any creditor of the society,
commits an offence.
Maximum penalty: $5 000.
(10) The granting, under the rules of a society, of a lease, licence
or other right to occupy or use land or a building, or a part of land or a
35 building, in favour of a shareholder of the society by force of the
person's membership does not constitute a reduction of the permanent
share capital of the society.
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Society financing dealings in its permanent shares etc.
242. (1) Except as otherwise expressly provided by this Code, a
society must not --
(a) whether directly or indirectly, give any financial assistance
5 for the purpose of, or in connection with --
(i) the acquisition by a person, whether before, or at the
same time as, the giving of financial assistance, of
permanent shares in the society; or
(ii) the proposed acquisition by a person of permanent
10 shares in the society; or
(b) whether directly or indirectly, in any way, acquire
permanent shares in the society; or
(c) whether directly or indirectly, in any way, lend money on
the security of permanent shares in the society.
15 (2) A reference in this section to the giving of financial assistance
includes a reference to the giving of financial assistance by means of
the making of a loan, the giving of a guarantee, the providing of
security, the releasing of an obligation or the forgiving of a debt or
otherwise.
20 (3) For the purposes of this section, a society is taken to have
given financial assistance for the purpose of an acquisition or proposed
acquisition (the ''relevant purpose'') if --
(a) the society gave the financial assistance for purposes that
included the relevant purpose; and
25 (b) the relevant purpose was a substantial purpose of the
giving of the financial assistance.
(4) For the purposes of this section, a society is taken to have
given financial assistance in connection with an acquisition or proposed
acquisition if, when the financial assistance was given to a person, the
30 society was aware that the financial assistance would financially
assist --
(a) the acquisition by a person of permanent shares in the
society; or
(b) if permanent shares in the society had already been
35 acquired, the payment by a person of any unpaid amount of
the subscription payable for the permanent shares or any
premium payable in relation to the permanent shares, or
the payment of any calls on the permanent shares.
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(5) If a society contravenes subsection (1), any officer of the society
who is in default commits an offence.
Maximum penalty: $5 000.
(6) If --
5 (a) a person is convicted of an offence against subsection (5);
and
(b) the court by which the person is convicted is satisfied that
the society or another person has suffered loss or damage
because of the contravention that constituted the offence,
10 the court may, in addition to imposing a penalty, order the convicted
person to pay compensation to the society or other person of an amount
specified by the court.
(7) The order may be enforced as if it were a judgment of that
court.
15 (8) The power of a court under section 476 to relieve a person to
whom that section applies from a liability mentioned in that section
extends to relieving a person against whom an order may be made
under subsection (6) from the liability to have such an order made
against the person.
20 (9) In this section, a reference to an acquisition or proposed
acquisition of shares is a reference to any acquisition or proposed
acquisition, whether by way of purchase, subscription or otherwise.
Exceptions
243. (1) Section 242 (1) does not prohibit --
25 (a) the payment of a dividend by a society in good faith and in
the ordinary course of commercial dealing; or
(b) a payment made by a society under a reduction of capital in
accordance with this Part; or
(c) the discharge by a society of a liability of the society that
30 was incurred in good faith as a result of a transaction
entered into on ordinary commercial terms; or
(d) an acquisition by a society of an interest (other than a legal
interest) in fully paid permanent shares in the society if no
consideration is provided by the society, or by any related
35 body corporate, for the acquisition; or
(e) the purchase by a society of permanent shares in the
society under an order of a court; or
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(f) the creation or acquisition, in good faith and in the ordinary
course of commercial dealing, by a society of a lien on
permanent shares in the society (other than fully paid
permanent shares) for any amount payable to the society in
5 relation to the permanent shares; or
(g) the entering into, in good faith and in the ordinary course
of commercial dealing, of an agreement by a society with a
subscriber for permanent shares in the society permitting
the subscriber to make payments for the permanent shares
10 (including payments in relation to any premium) by
instalments.
(2) Subsection (1) does not --
(a) imply that a particular act of a society would, but for that
subsection, be prohibited by section 242 (1); or
15 (b) limit the operation of any rule of law permitting the giving
of financial assistance by a society, the acquisition of
permanent shares by a society or the lending of money by a
society on the security of permanent shares.
(3) Section 242 (1) does not prohibit --
20 (a) the making of a loan, the giving of a guarantee or the
providing of security by a society in the ordinary course of
business if the loan that is made by the society, or in
relation to which the guarantee or security is given or
provided, is made on ordinary commercial terms as to the
25 rate of interest, the terms of repayment of principal and
payment of interest, the security to be provided and
otherwise; or
(b) the giving by a society of financial assistance to acquire
fully paid permanent shares in the society, if --
30 (i) the assistance is given under a scheme approved --
(I) if the scheme is conducted only for employees of
the society, by the society at a general meeting;
or
(II) in any other case, by the SSA in accordance
35 with a standard; and
(ii) the permanent shares are to be held by or for the
benefit of a person taking part in the scheme.
(4) Section 242 (1) does not prohibit the giving by a society of
financial assistance for the purpose of, or in connection with, an
40 acquisition or proposed acquisition by a person of permanent shares in
the society if --
(a) the society does so under a special resolution passed by the
society; and
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(b) the notice of the proposed special resolution given to
members of the society sets out --
(i) particulars of the financial assistance proposed to be
given and the reasons for the proposal to give that
5 assistance; and
(ii) the effect that the giving of the financial assistance
would have on the financial position of the society
and any group for which the society is the holding
society,
10 and is accompanied by a copy of a statement made under a resolution of
the directors, setting out the names of any directors who voted against
the resolution and the reasons why they so voted, and signed by not
fewer than 2 directors, stating whether, in the opinion of the directors
who voted in favour of the resolution, after taking into account the
15 financial position of the society (including future liabilities and
contingent liabilities), the giving of the financial assistance would be
likely to prejudice materially the interests of the creditors or members
of the society or any class of those creditors or members; and
(c) not later than the day after the day when the notice
20 mentioned in paragraph (b) is given to members of the
society, there is lodged with the SSA, a copy of that notice
and a copy of the statement that accompanied the notice;
and
(d) within 21 days after the general meeting of the society at
25 which the special resolution is passed a notice --
(i) setting out the terms of the special resolution; and
(ii) stating that any persons specified in subsection (6)
may, within the period specified in that subsection,
make an application to the Court opposing the giving
30 of the financial assistance,
is published, in each State in which the society is carrying
on business in a newspaper circulating generally in the
State; and
(e) no application opposing the giving of the financial
35 assistance is made within the period specified in subsection
(6) or, if such an application is made, the application is
withdrawn or the Court approves the giving of the financial
assistance.
(5) If, on application to the Court by a society, the Court is
40 satisfied that subsection (4) has been substantially complied with by the
society in relation to proposed financial assistance of the kind
mentioned in that subsection, the Court may, by order, declare that the
subsection has been complied with in relation to the proposed financial
assistance.
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(6) If a special resolution is passed by a society, an application to
the Court opposing the giving of the financial assistance to which the
special resolution relates may be made, within the period of 21 days
after the publication of the notice mentioned in subsection (4) (d) by --
5 (a) a member or creditor of the society; or
(b) a member or creditor of a subsidiary of the society; or
(c) the SSA.
(7) On an application under subsection (6), the Court --
(a) is to, in determining what orders to make in relation to the
10 application, have regard to the rights and interests of the
members of the society or of any class of them as well as to
the rights and interests of the creditors of the society or of
any class of them; and
(b) may not make an order approving the giving of the
15 financial assistance unless the Court is satisfied that --
(i) the society has disclosed to the members of the
society all material matters relating to the proposed
financial assistance; and
(ii) the proposed financial assistance would not, after
20 taking into account the financial position of the
society (including any future or contingent liabilities),
be likely to prejudice materially the interests of the
creditors or members of the society or of any class of
those creditors or members; and
25 (c) may do all or any of the following --
(i) make an order for the purchase by the society of the
interests of dissentient members of the society;
(ii) adjourn the proceeding in order that an arrangement
may be made to the satisfaction of the Court for the
30 purchase (otherwise than by the society or by a
subsidiary of the society) of the interests of
dissentient members;
(iii) give such ancillary or consequential directions and
make such ancillary or consequential orders as it
35 considers appropriate;
(iv) make an order disapproving the giving of the
financial assistance or, subject to this section, an
order approving the giving of the financial assistance.
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(8) If the Court makes an order under this section in relation to a
society, the society must, within 14 days after the making of the order,
lodge with the SSA an office copy of the order.
(9) The passing of a special resolution by a society relating to
5 financial assistance, and the approval by the Court of the giving of the
financial assistance, do not relieve a director of the society of any duty
to the society under this Code or otherwise (whether or not of a
fiduciary nature) in connection with the giving of the financial
assistance.
10 (10) In this section, a reference to an acquisition or proposed
acquisition of shares is a reference to any acquisition or proposed
acquisition whether by way of purchase, subscription or otherwise.
Consequences of society financing dealings in its permanent
shares etc.
15 244. (1) Except as provided by this section --
(a) the validity of a contract or transaction is not affected by a
contravention of section 242 (1) (a); and
(b) the validity of a contract or transaction is not affected by a
contravention of section 242 (1) (b) unless the contract or
20 transaction effects the acquisition that constitutes the
contravention; and
(c) the validity of a contract or transaction is not affected by a
contravention of section 242 (1) (c) unless the contract or
transaction effects the loan that constitutes the
25 contravention.
(2) If a society makes or performs a contract, or engages in a
transaction, that would, but for subsection (1), be invalid because --
(a) the contract was made or performed, or the transaction was
engaged in, in contravention of section 242; or
30 (b) the contract or transaction is related to a contract that was
made or performed, or to a transaction that was engaged in,
in contravention of that section,
the first contract or transaction is, subject to this section, voidable at
the option of the society by written notice given to each of the other
35 parties to the contract or transaction.
(3) The Court may, on the application of a member, officer or
creditor of a society, by order, authorize the person to give a notice
under subsection (2) in the name of the society.
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(4) If --
(a) a society makes or performs a contract, or engages in a
transaction; and
(b) the contract is made or performed, or the transaction is
5 engaged in, in contravention of section 242 or the contract
or transaction is related to a contract that was made or
performed, or to a transaction that was engaged in, in
contravention of the section; and
(c) the Court is satisfied, on the application of the society or of
10 another person, that the society or that other person has
suffered, or is likely to suffer, loss or damage because of --
(i) the making or performance of the contract or the
engaging in of the transaction; or
(ii) the making or performance of a related contract or
15 the engaging in of a related transaction; or
(iii) the contract or transaction being void because of
section 242 or having become void, or becoming void,
under this section; or
(iv) a related contract or transaction being void because of
20 section 242 or having become void, or becoming void,
under this section,
the Court may make such orders as it considers just and equitable
(including, for example, any of the orders mentioned in subsection (5))
against a party to the contract or transaction or to the related contract
25 or transaction, or against the society or against any person who aided,
abetted, counselled or procured, or was, by act or omission, in any way,
directly or indirectly, knowingly concerned in or party to the
contravention.
(5) The orders that may be made under subsection (4) include --
30 (a) an order directing a person to refund money or return
property to the society or another person; and
(b) an order directing a person to pay to the society or another
person a specified amount not more than the amount of the
loss or damage suffered by the society or other person; and
35 (c) an order directing a person to indemnify the society or
another person against any loss or damage that the society
or other person may suffer because of the contract or
transaction or because of the contract or transaction being
or having become void.
40 (6) If a certificate signed by at least 2 directors, or by a director
and a secretary, of a society stating that the requirements of
section 243 (4) have been complied with in relation to the proposed
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giving by the society of financial assistance for the purpose of an
acquisition or proposed acquisition by a person of permanent shares in
the society is given to a person --
(a) the person to whom the certificate is given is not under any
5 liability to have an order made against the person under
subsection (4) because of any contract made or performed,
or any transaction engaged in, by the person in reliance on
the certificate; and
(b) any such contract or transaction is not invalid, and is not
10 voidable under subsection (2), because the contract is made
or performed, or the transaction is engaged in, in
contravention of section 242 or is related to a contract that
was made or performed, or to a transaction that was
engaged in, in contravention of the section.
15 (7) Subsection (6) does not apply in relation to a person to whom a
certificate is given under that subsection in relation to a contract or
transaction if the Court, on application by the society concerned or
another person who has suffered, or is likely to suffer, loss or damage
because of the making or performance of the contract or the engaging in
20 of the transaction, or the making or performance of a related contract or
the engaging in of a related transaction, by order, declares that it is
satisfied that the person to whom the certificate was given became
aware before the contract was made or the transaction was engaged in
that the requirements of section 243 (4) had not been complied with in
25 relation to the financial assistance to which the certificate related.
(8) For the purpose of subsection (7), a person is, in the absence of
evidence to the contrary, taken to have been aware at a particular time
of any matter of which an employee or agent of the person having
duties or acting on behalf of the person in relation to the relevant
30 contract or transaction was aware at the time.
(9) In a proceeding, a document purporting to be a certificate given
under subsection (6) is, in the absence of evidence to the contrary,
taken to be such a certificate and to have been duly given.
(10) A person who has possession of a certificate given under
35 subsection (6) is, in the absence of evidence to the contrary, taken to be
the person to whom the certificate was given.
(11) If a person signs a certificate stating that the requirements of
section 243 (4) have been complied with in relation to the proposed
giving by a society of financial assistance and any of those requirements
40 had not been complied with in relation to the proposed giving of that
assistance at the time when the certificate was signed by that person,
the person commits an offence.
Maximum penalty: $25 000.
(12) If a society makes a contract or engages in a transaction
45 under which it gives financial assistance as mentioned in
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section 242 (1) (a) or lends money as mentioned in section 242 (1) (c),
any contract or transaction made or engaged in because of, or by means
of, or in relation to, the financial assistance or money is to be taken, for
the purposes of this section, to be related to the first contract or
5 transaction.
(13) The power of a court under section 476 to relieve a person to
whom that section applies from a liability mentioned in that section
extends to relieving a person against whom an order may be made
under subsection (4) from the liability to have such an order made
10 against the person.
(14) Any rights or liabilities of a person under this section
(including rights or liabilities under an order made by the Court under
this section) are in addition to and not in derogation of any rights or
liabilities of that person apart from this section but, if there would be
15 any inconsistency between the rights and liabilities of a person under
this section or under an order made by the Court under this section and
the rights and liabilities of the person apart from this section, the
provisions of this section or of the order made by the Court prevail.
Prohibition on subsidiary acquiring permanent shares of
20 holding society
245. (1) A body corporate must not be a holder of permanent
shares of a society that is its holding society, and any allotment or
transfer of permanent shares in a society to its subsidiary is void.
(2) This section does not prevent a subsidiary from continuing to
25 be a holder of permanent shares of its holding society if, at the time
when it becomes a subsidiary of the holding society, it already holds
permanent shares in the holding society, but the subsidiary must,
within one year or such longer period as the Court may allow after
becoming the subsidiary of its holding society, dispose of all of its
30 shares in the holding society.
(3) Subsections (1) and (2) apply in relation to a nominee of a body
corporate that is a subsidiary as if references in this section to that
body corporate included references to a nominee for it.
(4) Subsection (1) does not apply if --
35 (a) the subsidiary is concerned as personal representative; or
(b) the subsidiary is concerned as a trustee and --
(i) the holding society or a subsidiary of the holding
society is not beneficially interested under the trust;
or
40 (ii) the holding society or a subsidiary of the holding
society is beneficially interested under the trust only
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by way of a security given for the purposes of a
transaction entered into in the ordinary course of
business in connection with the lending of money,
other than a transaction entered into with an
5 associate of the holding society or a subsidiary of the
holding society.
Options over permanent shares
246. An option granted by a society that enables a person to take up
permanent shares in the society after the end of 5 years from the date
10 on which the option was granted is void.
Division 3 -- Redeemable Preference Shares
Application of certain provisions of this Code to redeemable
preference shares
247. (1) The following provisions apply to redeemable preference
15 shares to which this Division relates with all necessary modifications
and any prescribed modifications --
(a) section 227 (2);
(b) section 229;
(c) section 231;
20 (d) section 232;
(e) section 238;
(f) section 239;
(g) section 240;
(h) section 242;
25 (i) section 243;
(j) section 244;
(k) section 245;
(l) section 246;
(m) section 320;
30 (n) section 321;
(o) section 322.
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(2) Without limiting subsection (1), those provisions apply to
redeemable preference shares as if those shares were permanent shares
of the society that are preference shares.
Issue of redeemable preference shares
5 248. (1) Subject to this section, a society that has permanent share
capital may, if authorized by its rules, issue redeemable preference
shares.
(2) The society must not redeem the shares --
(a) except on such terms, and in such way, as are provided by
10 the society's rules; and
(b) except out of profits that would otherwise be available for
dividends or out of the proceeds of a fresh issue of
permanent shares or redeemable preference shares made
for the purposes of the redemption.
15 (3) The premium (if any) payable on redemption is to be provided
for out of profits of the management fund of the society or out of the
share premium account.
(4) If redeemable preference shares are redeemed otherwise than
out of the proceeds of a fresh issue of permanent shares there must, out
20 of profits that would otherwise have been available for dividends, be
transferred to a reserve called the ''capital redemption reserve'' the
nominal amount of the shares redeemed, and section 241 applies as if
the capital redemption reserve were paid-up permanent share capital of
the society.
25 (5) If, under this section, a society has redeemed or is about to
redeem preference shares, it may issue permanent shares or new
redeemable preference shares up to the sum of the nominal values of
the shares redeemed or to be redeemed as if those preference shares
had never been issued.
30 (6) The capital redemption reserve may be applied in paying up
unissued permanent shares or redeemable preference shares of the
society to be issued to members of the society as fully-paid bonus
shares.
(7) If a society redeems any redeemable preference shares, it must,
35 within 14 days after so doing, lodge with the SSA a notice in accordance
with the regulations relating to the shares redeemed.
(8) Shares are taken to have been redeemed even if a cheque given
in payment of the amount payable on redemption of the shares has not
been presented for payment.
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(9) If a society contravenes this section, the society commits an
offence.
Maximum penalty: $5 000.
Division 4 -- Shareholding Restrictions
5 Subdivision 1 -- Interpretative provisions
Application of Division
249. This Division applies to shares issued by a society under this
Code.
Extraterritorial operation of Division
10 250. Without limiting the generality of section 17 --
(a) the obligation to comply with this Division extends to all
individuals, whether or not resident in this State or in
Australia and whether or not Australian citizens, and to all
bodies, whether or not incorporated or carrying on business
15 in this State or in Australia; and
(b) this Division extends to acts done or omitted to be done
outside this State, whether or not in Australia.
What constitutes an ''entitlement'' to shares
251. For the purposes of this Division, the shares in a society to
20 which a person (including the society or any society) is entitled
include --
(a) shares in which the person has a relevant interest; and
(b) except if the person is a nominee body corporate in relation
to which a certificate by the SSA is in force under
25 section 253 (4), shares in which a person who is an
associate of the person has a relevant interest.
What constitutes a ''relevant interest'' in shares
252. (1) For the purposes of this Division, a person has a
''relevant interest'' in a share in a society if --
30 (a) the person or an associate of the person has power to
dispose of or to exercise control over the disposal of the
share; or
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(b) the person or an associate of the person has power to
exercise or to control the exercise of any right to vote
conferred on the holder of the share.
(2) It is immaterial for the purposes of this section whether a
5 power that a person has --
(a) is express or implied or formal or informal; or
(b) is exercisable alone or jointly with other persons; or
(c) cannot be related to a particular share; or
(d) is, or is capable of being, exercised, subject to restraint or
10 restriction,
and any such power exercisable jointly with other persons is taken to be
exercisable by any of the persons.
(3) A reference in this section to power or control includes a
reference to power or control that --
15 (a) is direct or indirect; or
(b) is, or is capable of being, exercised because of, or by means
of, or in breach of, or by revocation of, trusts, agreements,
arrangements, understandings and practices, or any of
them (whether or not they are enforceable),
20 and a reference in this section to a controlling interest includes a
reference to such an interest as gives control.
(4) Without limiting subsections (1) to (3), if a body corporate has,
or is by force of this section taken to have, a power and --
(a) the body corporate is, or its directors are, accustomed or
25 under an obligation, whether formal or informal, to act in
accordance with the directions, instructions or wishes of a
person in relation to the exercise of the power; or
(b) a person has a controlling interest in the body corporate,
the person is, for the purposes of this section, taken to have the same
30 power in relation to that share as the body corporate has or is taken to
have.
(5) If a body corporate has, or is by force of this section (other than
this subsection) taken to have, a power, a person (the ''relevant
person'') is, for the purposes of this section, taken to have the same
35 power in relation to that share as the body corporate has, or is taken to
have, if --
(a) the relevant person has; or
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(b) a person associated with the relevant person has; or
(c) persons associated with the relevant person together have;
or
(d) the relevant person and a person or persons associated with
5 the relevant person together have,
the power to exercise, or to control the exercise of, the voting power
attached to not less than 10% or such other proportion as may be
prescribed, of the voting shares in the body corporate.
(6) If a person --
10 (a) has entered into an agreement in relation to an issued
share; or
(b) has a right relating to an issued share, whether the right is
enforceable presently or in the future and whether or not on
the fulfilment of a condition; or
15 (c) has an option in relation to an issued share,
and, on performance of the agreement, enforcement of the right or
exercise of the option, the person would have a relevant interest in the
share, the person is, for the purposes of this section, taken to have that
relevant interest in the share.
20 (7) For the purposes of this section, if a body corporate is, under
subsection (6), taken to have a relevant interest in a share and --
(a) the body corporate or its directors are accustomed or under
an obligation, whether formal or informal, to act in
accordance with the directions, instructions or wishes of a
25 person in relation to the exercise of, or the control of the
exercise of, any right to vote conferred on the holder of the
share, or in relation to the disposal of, or the exercise of
control over the disposal of, that share; or
(b) a person has a controlling interest in the body corporate; or
30 (c) a person has power to exercise, or to control the exercise of,
the voting power attached to not less than 10%, or such
other proportion as may be prescribed, of the voting shares
in the body corporate,
the person is taken to have a relevant interest in that share.
35 (8) A body corporate may be taken, for the purposes of this
Division, to have a relevant interest in a share in the body corporate
itself.
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(9) A relevant interest in a share is not to be disregarded only
because of --
(a) its remoteness; or
(b) the way in which it arose.
5 (10) A director of a society is not taken to have a relevant interest
in a share in the society merely because the board is entitled to
withhold consent to a transfer of the share.
(11) A regulation may provide that relevant interests in shares in
societies are, in such circumstances and subject to such conditions (if
10 any) as are specified in the regulation, to be disregarded for the
purposes of this section.
Meaning of ''associate''
253. (1) A reference in this Division to an associate of a person is a
reference to --
15 (a) if the person is a body corporate --
(i) a director or secretary of the body corporate; or
(ii) a body corporate that is related to that person; or
(iii) a director or secretary of such a related body
corporate; or
20 (b) if the matter to which the reference relates is shares in a
body corporate (including, in a case where the first person
is a body corporate, the first person), a person (the
''relevant associate'') that is the body corporate or
another person with whom the first person has, or proposes
25 to enter into, an agreement, arrangement, understanding or
undertaking, whether formal or informal and whether
express or implied --
(i) because of which the relevant associate, or the first
person, may exercise, may directly or indirectly
30 control the exercise of, or may substantially influence
the exercise of, any voting power in the body
corporate; or
(ii) with a view to controlling or influencing the
composition of the board of directors, or the conduct
35 of affairs, of the body corporate; or
(iii) under which the relevant associate may acquire from
the first person, or the first person may acquire from
the relevant associate, shares in the body corporate;
or
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(iv) under which the relevant associate, or the first
person, may be required to dispose of shares in the
body corporate in accordance with the directions of
the first person or the relevant associate, as the case
5 may be; or
(c) a person in concert with whom the first person is acting, or
proposes to act, in relation to the matter to which the
reference relates; or
(d) a person with whom the first person is, by force of the
10 regulations, taken to be associated in relation to the matter
to which the reference relates; or
(e) a person with whom the first person is, or proposes to
become, associated whether formally or informally, in
another way in relation to the matter to which the
15 reference relates; or
(f) if the first person has entered into, or proposes to enter
into, a transaction, or has done or proposes to do, another
thing, with a view to becoming associated with a person as
mentioned in paragraphs (b) to (e), the last person.
20 (2) A person is not taken to be an associate of another person
under subsection (1) (b) to (f) merely because --
(a) one of the persons gives advice to, or acts on behalf of, the
other person in the proper performance of the functions
attaching to the person's professional capacity or the
25 person's business relationship with the other person; or
(b) without limiting paragraph (a), if the ordinary business of
one of those persons includes dealing in securities, specific
instructions are given to the person by or on behalf of the
other person to acquire shares on behalf of the other person
30 in the ordinary course of the business.
(3) For the purposes of subsection (1) (b), it is immaterial that the
power of a person to exercise, control the exercise of, or influence the
exercise of, voting power is in any way qualified.
(4) The SSA may issue to a nominee body corporate a certificate
35 declaring the nominee body corporate to be an approved nominee body
corporate for the purposes of section 251 and may, at any time, by
written notice given to the nominee body corporate, revoke the
certificate.
(5) The SSA may issue to a person a certificate declaring that
40 specified shares in which the person has a relevant interest are to be
disregarded for the purposes of ascertaining the shares to which
another person specified in the certificate is entitled and may, at any
time, by written notice given to the first person, revoke the certificate.
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Meaning of voting power or right to vote
254. For the purposes of this Division, a reference to voting power or
a right to vote attached to a share in a body corporate is, if the body
corporate is a society, to be read as a reference to the right to vote
5 conferred on the holder of a share in the society.
Inadvertence or mistake
255. In determining, for the purposes of a provision of this Division,
whether or not a person's contravention of such a provision was due to
the person's inadvertence or mistake or to the person not being aware
10 of a relevant fact or happening, a person's ignorance of, or a mistake on
the person's part concerning, a matter of law is to be disregarded.
Subdivision 2 -- Maximum shareholdings
Maximum permissible shareholding
256. (1) For the purposes of this Subdivision, a person has more
15 than the maximum permissible shareholding in a society if the person
has an entitlement --
(a) if a society has issued one class of either permanent shares
or redeemable preference shares, to permanent shares or
redeemable preference shares in the society, as the case
20 may be, of more than 10%, or such other percentage as may
be prescribed, of the nominal value of all permanent shares
or redeemable preference shares issued by the society; or
(b) if a society has issued one class of permanent shares and
one class of redeemable preference shares --
25 (i) to permanent shares in the society of more than 10%,
or such other percentage as may be prescribed, of the
nominal value of all permanent shares issued by the
society; or
(ii) to redeemable preference shares in the society of
30 more than 10%, or such other percentage as may be
prescribed, of the nominal value of all redeemable
preference shares issued by the society; or
(c) if a society has issued more than one class of permanent
shares or more than one class of redeemable preference
35 shares, to shares in any class of shares of the society of
more than 10%, or such other percentage as may be
prescribed, of the nominal value of all shares of that class
issued by the society.
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(2) A percentage applicable under subsection (1) may be varied in
its application to a particular society by being decreased by the rules of
the society.
Consequences of exceeding maximum permissible shareholding
5 257. (1) If a person has more than the maximum permissible
shareholding in a society, the society must forfeit and sell the excess
shares.
(2) Section 237 applies to the offering and sale of shares forfeited
as if the shares had been forfeited for non-payment of a call.
10 (3) If a person has more than the maximum permissible
shareholding in a society and a society is required to forfeit and sell the
excess shares, the person is not entitled to a vote in any meeting of
members of the society until the excess shares are forfeited and sold.
Exceptions
15 258. Section 257 does not apply to a person --
(a) who acquired the relevant interests concerned in accordance
with an approval given under Part 7; or
(b) who has the relevant interests concerned because of a share
issue and the relevant interests represent a proportion of
20 the issued shares of the society concerned that is no more
than the proportion which the person had before the share
issue; or
(c) if the person had, before acquiring the excess shares,
reported the proposal to acquire them to the SSA and
25 obtained approval under section 262 and the total nominal
value of the shares held by the person is not more than the
limit approved under that section in relation to the person.
Subdivision 3 -- Substantial shareholdings
Substantial shareholding and substantial shareholders
30 259. (1) Part 6.7 of the Corporations Law applies to a society with
all necessary modifications and any prescribed modifications.
(2) Without limiting subsection (1), the provisions of Part 6.7 of
the Corporations Law are to be applied as if --
(a) a reference to a company were a reference to a society; and
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(b) a reference to the Commission were a reference to the SSA;
and
(c) a reference to a shareholder were a reference to a member;
and
5 (d) a reference to a voting share were a reference to a share;
and
(e) the expressions ''entitlement'', ''relevant interest'' and
''associate'' had the meanings given in this Division rather
than the meaning given in that Law.
10 (3) The purpose of subsections (1) and (2) is to apply Part 6.7 of
the Corporations Law in its modified form to a society whether or not
the society is a listed company under Chapter 6 of the Corporations
Law.
(4) However, the application of Part 6.7 of the Corporations Law
15 under subsections (1) and (2) is in addition to, and not in substitution
for, the application of that Part under its own force.
Subdivision 4 -- Power to obtain information
Power to obtain information
260. (1) Part 6.8 of the Corporations Law applies to a society with
20 all necessary modifications and any prescribed modifications.
(2) Without limiting subsection (1), the provisions of Part 6.8 of
the Corporations Law are to be applied as if --
(a) a reference to a company were a reference to a society; and
(b) a reference to the Commission were a reference to the SSA;
25 and
(c) the expressions ''entitlement'', ''relevant interest'' and
''associate'' had the meanings given in this Division rather
than the meaning given in that Law.
(3) The purpose of subsections (1) and (2) is to apply Part 6.8 of
30 the Corporations Law in its modified form to a society whether or not
the society is a listed company under Chapter 6 of the Corporations
Law.
(4) However, the application of Part 6.8 of the Corporations Law
under subsections (1) and (2) is in addition to, and not in substitution
35 for, the application of that Part under its own force.
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Subdivision 5 -- Enforcement
Court orders -- substantial shareholdings
261. (1) For the purposes of this Part, sections 741 to 744 of the
Corporations Law apply to a society with all necessary modifications
5 and any prescribed modifications.
(2) Without limiting subsection (1), those sections of the
Corporations Law are to be applied as if --
(a) a reference to a company were a reference to a society; and
(b) a reference to the Commission were a reference to the SSA.
10 Power of SSA to exempt etc. from Division
262. (1) The SSA may, subject to the standards, by written notice
given to a person, exempt the person, subject to such conditions (if any)
as are specified in the notice, from compliance with all or any of the
provisions of this Division or any regulation made for the purpose of
15 this Division.
(2) A person must not contravene a condition to which an
exemption is subject.
Maximum penalty: $25 000.
(3) If a person has contravened a condition to which an exemption
20 is subject, the Court may, on application of the SSA, order the person to
comply with the condition.
(4) The SSA may, subject to the standards, by written notice,
declare that a provision of this Division or a regulation made for the
purposes of this Division, has effect in its application to a particular
25 person or particular persons --
(a) in a particular case; or
(b) in relation to particular shares, or shares included in a
particular class of shares,
as if the provision or regulation were omitted or modified or varied in a
30 way specified in the notice and, if such a declaration is made, the
provision or regulation has effect accordingly.
(5) The SSA must cause a notification of the making of an
exemption or declaration to be published in the Gazette, but failure of
the SSA to do so does not affect the validity of the exemption or
35 declaration.
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(6) A notification mentioned in subsection (5) must name --
(a) the persons to whom the exemption or declaration relates;
and
(b) the provisions to which the exemption or declaration
5 relates; and
(c) if the exemption or declaration relates to a particular
society or class of society, the society or class.
Division 5 -- Issue of Shares
Issuing of shares at a discount prohibited
10 263. A society must not issue --
(a) permanent shares at a discount; or
(b) redeemable preference shares at a discount unless they are
of a prescribed class.
Issuing of shares as partly paid up etc.
15 264. (1) A society must not issue redeemable preference shares as
partly paid up.
(2) A society must not issue redeemable preference shares
otherwise than in consideration of the payment of cash.
Power of SSA to exempt etc. from Division
20 265. (1) The SSA may, by written notice given to a person, exempt
the person, subject to such conditions (if any) as are specified in the
notice, from compliance with a regulation made for the purposes of this
Division.
(2) An exemption may relate to any particular shares or to shares
25 included in a class of shares.
(3) A person must not contravene a condition to which an
exemption is subject.
Maximum penalty: $25 000.
(4) If a person has contravened a condition to which an exemption
30 is subject, the Court may, on application of the SSA, order the person to
comply with the condition.
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(5) The SSA may, by written notice, declare that a regulation
made for the purposes of or under this Division, has effect in its
application to or in relation to a particular person or particular
persons --
5 (a) in a particular case; or
(b) in relation to particular shares or shares included in a
particular class of shares,
as if the regulation were omitted or modified or varied in a way
specified in the notice and, if such a declaration is made, the regulation
10 has effect accordingly.
(6) The SSA must cause a copy of an exemption or declaration to
be published in the Gazette, but failure of the SSA to do so does not
affect the validity of the exemption or declaration.
Division 6 -- Title to and Transfer of Shares
15 Restricted application of this Division
266. This Division does not apply to the extent that its application
would be inconsistent with the application under its own force of
Division 3 of Part 7.13 of the Corporations Law.
Document of title to be evidence of title
20 267. (1) A document of title issued by a society specifying any
shares held by a member of a society is evidence of the member's title
to the shares.
(2) A document of title must be under the common seal of the
society and must state --
25 (a) the name of the society; and
(b) the class of the shares; and
(c) if appropriate, the nominal value of the shares and the
extent to which the shares are paid up.
(3) Failure to comply with this section does not affect the rights of
30 a holder of shares in a society.
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Loss or destruction of documents
268. (1) Subject to subsection (2), where a document of title to
shares is lost or destroyed, the society must, on application by the
owner of the shares issue a duplicate document of title to the owner --
5 (a) if the society requires the payment of an amount of not
more than the prescribed amount, within 21 days after the
payment is received by the society or within such longer
period as the SSA approves; or
(b) in any other case, within 21 days after the application is
10 made or within such longer period as the SSA approves.
(2) The application must be accompanied by --
(a) a written statement that the document of title has been lost
or destroyed, and has not been pledged, sold or otherwise
disposed of and, if lost, that proper searches have been
15 made; and
(b) a written undertaking that if it is found or received by the
owner it will be returned to the society.
(3) The directors of a society may, before accepting an application
for the issue of a duplicate document of title, require the applicant
20 to --
(a) cause an advertisement to be inserted in a newspaper
circulating in a place specified by the directors stating that
the document of title has been lost or destroyed and that
the owner intends, after the expiration of 14 days after the
25 publication of the advertisement, to apply to the society for
a duplicate document of title; or
(b) give a bond for an amount equal to at least the current
market value of the shares indemnifying the society against
loss following the production of the original document of
30 title; or
(c) do both those things.
(4) If --
(a) a document of title to shares is cancelled under the SCH
certificate cancellation provisions; and
35 (b) having regard to the provisions, the document of title
should not have been cancelled,
this section applies to the document of title as though it were destroyed
on its cancellation.
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(5) For the purpose of subsection (4) --
''SCH certificate cancellation provisions'' has the meaning
given by section 9 of the Corporations Law.
Instrument of transfer
5 269. (1) Despite anything in its rules or in a deed relating to
permanent shares, a society must not register a transfer of permanent
shares unless an instrument of transfer has been delivered to the
society.
(2) The instrument of transfer must --
10 (a) be in writing in any usual or common form or in any other
form that the directors of the society approve; and
(b) be executed by or on behalf of both the transferor and the
transferee.
(3) Subsection (1) does not prejudice the power of the society to
15 register as the holder of shares a person to whom the right to those
shares has devolved by will or by operation of law.
(4) A transfer of shares of a deceased holder made by the holder's
personal representative is, although the personal representative is not
registered as the holder of those shares, as valid as it would be if the
20 personal representative had been so registered at the time of the
execution of the instrument of transfer.
(5) If the personal representative of a deceased holder duly
constituted as such under the law in force in another participating
State --
25 (a) executes an instrument of transfer of shares of the deceased
holder to the personal representative or to another person;
and
(b) delivers the instrument to the society, together with a
written statement to the effect that, to the best of the
30 personal representative's knowledge, information and belief,
no grant of representation of the estate of the deceased
holder has been applied for or made in this State and no
application for such a grant will be made, being a
statement made within 3 months immediately before the
35 date of delivery of the statement to the society,
the society must register the transfer and pay to the personal
representative any dividends or other money accrued in relation to the
shares up to the time of the execution of the instrument, but this
subsection does not operate so as to require the society to do anything
40 that it would not have been required to do if the personal
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representative were the personal representative of the deceased holder
duly constituted under the law of this State.
(6) A transfer or payment made under subsection (5) and a receipt
or acknowledgment of that payment is, for all purposes, as valid and
5 effectual as it would be if the personal representative were the personal
representative of the deceased holder duly constituted under the law of
this State.
(7) For the purposes of this section, an application by a personal
representative of a deceased person for registration as the holder of
10 shares in place of the deceased person is taken to be an instrument of
transfer effecting a transfer of those shares to the personal
representative.
(8) The production to a society of a document that is, under the
law of this State or under the law in force in another participating
15 State, sufficient evidence of a grant of probate of the will, or letters of
administration of the estate, of a deceased person must be accepted by
the society, despite anything in its rules or in a deed relating to its
shares, as sufficient evidence of that grant.
Registration of transfer at request of transferor
20 270. (1) On the written request of the transferor of a permanent
share issued by a society, the society must enter in the appropriate
register the name of the transferee in the same way and subject to the
same conditions as it would if the application for the entry were made
by the transferee.
25 (2) On the written request of the transferor of a permanent share
issued by a society, the society must, by written notice, require the
person having the possession, custody or control of any documents
evidencing title to the share or the instrument of transfer affecting any
such share or both such documents and instrument to deliver the
30 documents or instrument to the registered office of the society within a
specified period (not less than 7 and not more than 28 days after the
date of the notice) to have the documents cancelled or rectified and the
transfer registered or otherwise dealt with.
(3) If a person refuses or neglects to comply with a notice given
35 under subsection (2), the transferor may apply to the Court to issue a
summons for the person to appear before the Court and show cause why
the documents or instrument mentioned in the notice should not be
delivered up or produced as required by the notice.
(4) On the appearance of a person so summoned, the Court may
40 examine the person on oath or affirmation and receive other evidence
or, if the person does not appear after being duly served with the
summons, the Court may receive evidence in the person's absence and,
in either case, the Court may order the person to deliver up the
documents or instrument mentioned in the notice to the society on such
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terms or conditions as the Court considers appropriate, and the costs of
the summons and of proceedings on the summons are in the discretion
of the Court.
(5) Lists of documents called in under this section and not brought
5 in must be displayed in a conspicuous place at the registered office of
the society and must be advertised in the Gazette and in such
newspapers and at such times as the society considers appropriate.
Notice of refusal to register transfer
271. If a society refuses to register a transfer of permanent shares
10 issued by the society, it must, within 2 months after the date on which
the transfer was lodged with it, send to the transferee notice of the
refusal.
Remedy for refusal to register transfer or transmission
272. (1) If a society fails to register, or the board of a society fails
15 to give its approval to, a transfer or transmission of permanent shares
issued by the society, the transferee or transmittee may apply to the
Court for an order under this section.
(2) If the Court is satisfied that the failure was without just cause,
the Court may --
20 (a) order that the transfer or transmission be registered; or
(b) make such other order as it considers proper, including an
order providing for the purchase of the shares by a specified
member of the society or by the society.
Certification of transfers
25 273. (1) The certification by a society of an instrument of transfer
of permanent shares issued by the society is taken to be a
representation by the society to any person acting on the faith of the
certification that there have been produced to the society such
documents as on the face of them show title to those shares in the
30 transferor named in the instrument of transfer but is not taken to be a
representation that the transferor has any title to those shares.
(2) If a person acts on the faith of a false certification by a society
made negligently, the society is under the same liability to the person
as if the certification had been made fraudulently.
35 (3) If a certification is expressed to be limited to 42 days or any
longer period from the date of certification, the society and its officers
are not, in the absence of fraud, liable in relation to the registration of
any transfer of permanent shares comprised in the certification after
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the end of that period or any extension of that period given by the
society if the instrument of transfer has not, within that period, been
lodged with the society for registration.
(4) For the purposes of this section --
5 (a) an instrument of transfer is taken to be certificated if it
bears the words ''document lodged'' or words to similar
effect; and
(b) the certification of an instrument of transfer is taken to be
made by a society if --
10 (i) the person issuing the instrument is a person
authorized to issue certificated instruments of
transfer on behalf of the society; and
(ii) the certification is signed by a person authorized to
certificate transfers on behalf of the society or by an
15 officer of the society or of a corporation so authorized;
and
(c) a certification that purports to be authenticated by a
person's signature or initials (whether or not handwritten)
is to be taken to be signed by the person unless it is shown
20 that the signature or initials was not or were not placed
there by the person and was not or were not placed there
by any other person authorized to use the signature or
initials for the purpose of certificating transfers on behalf of
the society.
25 Duties of society in relation to issue of certificates
274. (1) Within 2 months after the issue to a person of permanent
shares of a society, the society must --
(a) complete and have ready for delivery to the person all the
appropriate documents in connection with the shares unless
30 the conditions of the issue otherwise provide; and
(b) unless otherwise instructed by the person, send or deliver
the completed documents to the person or, if the person has
instructed the society in writing to send them to a
nominated person, to the nominated person.
35 (2) Within one month after a transfer of permanent shares is
lodged with a society (other than a transfer that the society is for any
reason entitled to refuse to register and does not register), the society
must --
(a) complete and have ready for delivery to the transferee all
40 the appropriate documents in connection with the transfer;
and
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(b) unless otherwise instructed by the transferee, send or
deliver the completed documents to the transferee or, if the
transferee has instructed the society in writing to send
them to a nominated person, to the nominated person.
5 (3) If a society on which a notice has been served requiring the
society to make good any default in complying with the provisions of
this section fails to make good the default within 10 days after the
service of the notice, the Court may, on the application of the person
entitled to take delivery of the documents, make an order directing the
10 society and any officer of the society to make good the default within a
specified time.
(4) An order under subsection (3) may provide that all costs of and
incidental to the application are to be borne by the society or by any
officer of the society in default in such proportions as the Court
15 considers appropriate.
Exemption
275. (1) The power of the SSA to grant an exemption or make a
declaration under this section may be exercised in relation to shares or
a class of shares only if the SSA is satisfied that --
20 (a) if the exemption were granted or the declaration were
made, the interests of the holders of the shares or of shares
in the class would continue to have adequate protection;
and
(b) the granting of the exemption or the making of the
25 declaration would make transfer of the shares, or shares in
the class, more efficient.
(2) The SSA may, by written notice, exempt particular shares, or a
particular class of shares, either generally or as otherwise provided in
the exemption, and either unconditionally or subject to such conditions
30 (if any) as are specified in the exemption, from the operation of all or
any of the provisions of --
(a) this Division; and
(b) a regulation made for the purposes of this Division.
(3) A person must not contravene a condition to which an
35 exemption under subsection (2) is subject.
Maximum penalty: $25 000.
(4) If a person has contravened a condition to which an exemption
is subject, the Court may, on the application of the SSA, order the
person to comply with the condition.
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(5) The SSA may, by written notice, declare that a provision of
this Division or a regulation made for the purposes of this Division has
effect in its application to particular shares, or a particular class of
shares, either generally or otherwise as provided in the declaration, as
5 if the provision or regulation were omitted or modified or varied in a
way specified in the declaration and, if such declaration is made, the
provision or regulation has effect accordingly.
(6) The SSA must cause a copy of an exemption or declaration to
be published in the Gazette, but failure of the SSA to do so does not
10 affect the validity of the exemption or declaration.
Division 7 -- Registration of Charges
Registration of charges
276. (1) Subject to this Division, Part 3.5 of the Corporations Law
applies to a society with all necessary modifications and any prescribed
15 modifications.
(2) Without limiting subsection (1), the provisions of Part 3.5 of
the Corporations Law are to be applied as if --
(a) a reference to a company were a reference to a society; and
(b) a reference to the Commission were a reference to the SSA.
20 Directions by AFIC and SSA
277. (1) AFIC may, from time to time, issue directions to societies
in relation to standards, principles, practices and procedures to be
observed in or in connection with the creation and registration of
charges and may, from time to time, amend, vary or cancel a direction
25 so issued.
(2) The SSA may, from time to time, issue directions, not
inconsistent with directions issued by AFIC under subsection (1), in
relation to the matters mentioned in that subsection and may, from
time to time, amend, vary or cancel a direction so issued by the SSA.
30 (3) A provision of a direction issued under this section may --
(a) apply generally or be limited in its application by reference
to specified exceptions or factors; or
(b) apply differently according to different factors of a specified
kind; or
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(c) authorize any matter or thing to be from time to time
determined, applied or regulated by any specified person,
group of persons or body; or
(d) do any combination of those things.
5 (4) A regulation may make provision with respect to the creation
and registration of charges and, in particular, a regulation may be
made with respect to the following --
(a) the issue of directions by AFIC or SSA under this section;
(b) the enforcement of directions issued under this section.
10 SSA approval of charges necessary in certain circumstances
278. (1) The prior approval of the SSA to the creation of a charge
on the property of a society is required except in prescribed
circumstances.
(2) The SSA may decline to register a charge that has been
15 created without the prior approval of the SSA.
(3) In determining whether or not to approve or whether to
register a charge, the SSA must have regard to the effects that the
charge may have on compliance by the society with the standards.
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PART 6 -- MANAGEMENT
Division 1 -- Interpretation
Definition
279. In Division 2 of this Part --
5 ''employee'', in relation to a society, includes a person, or an
employee of a person, who provides the society with services
under a management contract as defined in section 297.
When one entity controls another
280. (1) For the purposes of Divisions 6 and 7, an entity controls
10 another entity if the entity is a subsidiary of the first entity.
(2) Despite subsection (1), a regulation may make provision for
determining, for the purposes of those Divisions as they apply in
relation to a society in relation to prescribed financial years, whether or
not an entity controls another entity.
15 (3) Subject to subsection (2), if because of a provision of an
applicable accounting standard that --
(a) deals with the making out of consolidated accounts; and
(b) applies to a financial year,
an entity is taken for the purposes of the accounting standard to control
20 another entity, the first entity is also taken to control the other entity
for the purposes of those Divisions as they apply in relation to a society
in relation to the financial year.
Division 2 -- Directors and Officers
Board of directors
25 281. (1) The business and operations of a society are to be managed
and controlled by a board of directors.
(2) Subject to this section, the board may exercise all the powers of
the society.
(3) The powers of the board are subject to any restrictions imposed
30 by the friendly societies legislation, applicable standards and the
society's rules.
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(4) Every director acting in the society's business or operations
under a resolution duly passed by the board is taken to be acting as the
society's duly authorized agent.
(5) Anything done by or in relation to a director is not invalid
5 merely because of a defect or irregularity in the director's election or
appointment.
Meetings of directors
282. (1) Meetings of a society's board must be held as often as is
necessary for properly conducting the society's business.
10 (2) Meetings of the board must be held at intervals of not longer
than 3 months.
(3) A quorum at a meeting of the board is the number of directors
prescribed by the society's rules, but must not be less than half the
total number of directors.
15 (4) Subject to this section, a meeting of the board may be
conducted in any way prescribed by the society's rules.
Minutes
283. A society must cause full and accurate minutes to be kept of
every meeting of its board.
20 Maximum penalty: $25 000.
Number of directors
284. The number of directors of a society must not be less than 5.
Election of directors
285. (1) Subject to the friendly societies legislation, the directors of
25 a society are elected, hold and vacate office, and retire or are removed
from office, as prescribed by the society's rules.
(2) A director holds office for a term (not longer than 3 years) as is
prescribed by the society's rules.
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(3) Despite subsection (2), in relation to a director elected at an
annual general meeting of a society, the society's rules may specify a
term of office ending --
(a) immediately before the election of directors at the third
5 annual general meeting of the society after the director's
election; or
(b) at the end of that third annual general meeting.
(4) A director is eligible for re-election at the end of the director's
term.
10 (5) The directors must be elected --
(a) at the annual general meeting of the society; or
(b) by postal voting under the society's rules; or
(c) in such other way as is prescribed by the society's rules.
(6) If the directors are elected by postal voting, the society must
15 cause the results of the election to be announced at the society's next
annual general meeting.
(7) Nothing in this section prevents a person nominated as a
director from being appointed as a director if the number of directors
nominated is less than or equal to the number of places to be filled.
20 Employee directors
286. The members of a society may, under the society's rules, elect
not more than 2 employees of the society nominated by the directors to
be directors of the society.
Alternate directors
25 287. (1) If authorized by a society's rules, a director may appoint a
person, who is eligible to be a director of the society, to be the alternate
director in place of that director.
(2) The alternate director may act as a director in the absence of
the director who appointed him or her.
30 (3) Only a director who is an employee of the society may appoint
an employee of the society to be his or her alternate director.
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Chairperson
288. (1) A society's board must elect one of its members as
chairperson.
(2) An employee of the society is not eligible to be the chairperson.
5 (3) The chairperson --
(a) must hold office; and
(b) must retire; and
(c) may be removed from office,
as prescribed by the society's rules.
10 Qualifications of directors
289. Subject to sections 286 and 287, a person is not eligible to be a
director of a society if the person --
(a) is a minor; or
(b) is not --
15 (i) a member of the society; or
(ii) the representative, appointed under section 83, of a
body corporate member of the society; or
(c) is a joint member other than the primary joint member
under section 82; or
20 (d) is an employee of the society; or
(e) is an insolvent under administration within the meaning of
section 9 of the Corporations Law; or
(f) is prohibited from being a director of a body corporate by
the Corporations Law for a reason other than the person's
25 age; or
(g) has been convicted in the last 10 years --
(i) of an indictable offence in relation to the promotion,
formation or management of a body corporate; or
(ii) of an offence involving fraud or dishonesty; or
30 (iii) of any prescribed offence.
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Vacation of office
290. (1) The office of a director becomes vacant if the director --
(a) dies; or
(b) becomes a person who, under section 289, is not eligible to
5 be a director; or
(c) for a director who is the representative, appointed under
section 83, of a body corporate member of the society and
whose eligibility for election to the office was based on
being that representative, ceases to be eligible under
10 section 83; or
(d) for a director elected under section 286, ceases to be an
employee of the society; or
(e) is absent from 3 consecutive ordinary meetings of the board
without its leave; or
15 (f) resigns by written notice of resignation given to the board;
or
(g) is 3 months in arrears for an amount payable to the society
and has failed to make arrangements for payment
satisfactory to the society; or
20 (h) is removed from office by a resolution under section 291.
(2) If there is a casual vacancy in the office of a director, the board
may appoint a person who is qualified under section 289 to fill the
vacancy.
(2A) The term of office of a director appointed to fill a casual
25 vacancy ends as provided by the society's rules either --
(a) immediately before the election of directors at the next
annual general meeting of the society after the
appointment; or
(b) at the end of that annual general meeting.
30 (3) A director may not be removed from office, and the office of a
director does not become vacant, except as provided by the friendly
societies legislation.
Removal of directors
291. (1) A society may, by resolution, remove a director before the
35 end of the director's term of office, despite anything in its rules or in
any agreement between it and the director.
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(2) The resolution may be passed only if the society has given
notice to members specifying the proposed resolution and the day and
time of the meeting when it is proposed the resolution will be made (the
''relevant meeting'').
5 (3) The society must also give a copy of the notice to the director.
(4) A society's rules may provide for --
(a) the period of notice; and
(b) the way notice may be given to members; and
(c) any other relevant matter.
10 (5) The director may make written representations to the society
(of a reasonable length) before the relevant meeting.
(6) The society must promptly send to each member a copy of any
written representations made by the director if --
(a) the director asks the society to do so; and
15 (b) there is enough time for the copies to be received by the
members at least 2 days before the relevant meeting.
(7) At the relevant meeting, the director --
(a) is entitled to be heard on the resolution to remove the
director; and
20 (b) if the director has made written representations under
subsection (5) and a copy has not been sent to members
under subsection (6), may require that the representations
be read out.
Declaration of interest
25 292. (1) A director of a society who is or becomes in any way
(whether directly or indirectly) interested in a contract, or proposed
contract, with the society must declare the nature and extent of the
interest to the society's board under this section.
Maximum penalty: $75 000 or imprisonment for 10 years, or both.
30 (2) Subsection (1) does not apply to a contract to provide financial
accommodation if the provision of the financial accommodation does not
contravene section 295.
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(3) 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
5 (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.
(4) If a director becomes interested in a contract with the society
10 after it is made, the declaration must be made at the next meeting of
the board held after the director becomes interested in the contract or,
if the director is absent from that meeting, the next meeting of the
board at which the director is present.
(5) For the purposes of this section, a general written notice given
15 to the board by a director to the effect that the director --
(a) is a member or an officer 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.
20 (6) A director of a society 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 subsection (7), declare at a meeting of
the society's board the fact and the nature, character and extent of the
25 conflict.
Maximum penalty: $75 000 or imprisonment for 10 years, or both.
(7) A declaration required by subsection (6) 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
30 she becomes a director, 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,
35 whichever is the later; or
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(b) if the person starts to hold the office or acquires the
interest after the person becomes 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
5 person's knowledge.
(8) A declaration under this section must be recorded in the
minutes of the meeting at which it was made and, unless the board
otherwise determines, the director must not --
(a) be present during any deliberation of the board in relation
10 to the matter; or
(b) take part in any decision of the board in relation to the
matter.
(9) For the purposes of the making of a determination of the board
under subsection (8) in relation to a director who has made a
15 declaration under this section, the director must not --
(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.
(10) Subsection (9) does not apply to a director of a society who is
20 interested in a contract or proposed contract with the society if --
(a) the contract or proposed contract has been or will be made
with or for the benefit of or on behalf of a wholly owned
subsidiary of the society; and
(b) the director is a director of that subsidiary.
25 (11) Every declaration must be reported by the board --
(a) to the SSA immediately after the making of the declaration;
and
(b) to the members at the next annual general meeting after
the making of the declaration.
30 (12) A society must, within 3 months after the end of its financial
year, lodge with the SSA a return specifying --
(a) all declarations made to the board during that financial
year; and
(b) all declarations in force at the end of the financial year.
35 Maximum penalty: $50 000.
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(13) This section is in addition to any rule of law or any provision
in a society's rules restricting a director from having an interest in
contracts with the society or from holding offices or having interests
involving duties or interests in conflict with the director's duties or
5 interests as a director.
General duty to make disclosure
293. (1) A director of a society must give written notice to the
society --
(a) of such particulars relating to securities, rights, options and
10 contracts or an interest in a benefit fund of the society as
are necessary to enable the society to comply with section
317; and
(b) of particulars of any change relating to the particulars
mentioned in paragraph (a), including the consideration (if
15 any) received because of the event giving rise to the change.
(2) A notice under subsection (1) must be given --
(a) if the notice is under subsection (1) (a), within 14 days after
the person --
(i) became a director; or
20 (ii) became aware that the person has acquired the
securities, a relevant interest in the securities or the
rights or options; or
(iii) entered into the contracts; or
(iv) acquired the interest in the benefit fund of the
25 society,
whichever happens last; and
(b) if the notice is under subsection (1) (b), within 14 days after
the person becomes aware of the happening of the event
giving rise to the change.
30 (3) A society must, within 7 days after receiving a notice, send a
copy to each of the other directors of the society.
(4) A director or society who contravenes this section commits an
offence and is liable on conviction to a maximum penalty of $25 000.
(5) In any proceeding under this section, a person is, in the
35 absence of evidence to the contrary, to be taken to have been aware at a
particular time of a fact or happening of which an employee or agent of
the person, being an employee or agent having duties of acting in
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relation to his or her employer's or principal's interests in a security
issued by the society concerned, was aware at that time.
Certain financial accommodation to officers prohibited
294. (1) An officer of a society who is not a director of the society
5 must not obtain financial accommodation from the society other
than --
(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
10 directors.
Maximum penalty: $50 000 or imprisonment for 7 years.
(2) For the purposes of this section, financial accommodation is
taken to be obtained by an officer of a society if it is obtained by --
(a) a proprietary company in which the officer is a shareholder
15 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 a trustee if the officer is
a director or other officer of the body corporate.
(3) A society must not give financial accommodation to an officer
20 of the society if --
(a) by giving the financial accommodation, the officer would
contravene this section; and
(b) the society knows or should reasonably know of the
contravention.
25 Maximum penalty: $50 000.
Financial accommodation to directors and associates
295. (1) In this section --
''associate'' of a director means --
(a) the director's spouse; or
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(b) a person when acting in the capacity of trustee of a
trust under which --
(i) the director or director's spouse has a beneficial
interest; or
5 (ii) a body corporate mentioned in paragraph (c)
has a beneficial interest; or
(c) a body corporate if --
(i) the director or director's spouse has a material
interest in shares in the body corporate; and
10 (ii) the nominal value of the shares is 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 if --
15 (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
(b) the person has power to dispose of or to exercise control
over the disposal of the share; or
20 (c) the person has power to exercise or to control the exercise
of any right to vote conferred on the holder of the share.
(3) A society must not provide financial accommodation to a
director, or to a person the society knows or should reasonably know is
an associate of a director, unless --
25 (a) the accommodation is --
(i) approved under subsection (4); or
(ii) given under a scheme approved under subsection (4);
or
(iii) provided on terms no more favourable to the director
30 or associate than the terms on which it is reasonable
to expect the society would give if dealing with the
director or associate at arm's length in the same
circumstances; and
(b) the directors have approved the accommodation, at a
35 meeting of the board at which a quorum was present, by a
majority of at least two-thirds of the directors present and
voting on the matter.
Maximum penalty: $50 000.
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(4) For the purposes of subsection (3) (a) (i) and (ii), financial
accommodation or a scheme is approved if --
(a) it is approved by a resolution passed at a general meeting;
and
5 (b) full details of the accommodation or 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 subsection (3) commits an
offence.
10 Maximum penalty: $50 000 or imprisonment for 7 years, or both.
(6) If a director of a society or an associate of a director accepts in
payment of a debt owed by a member of the society to the director or
associate, any proceeds of financial accommodation provided to the
member by the society as referred to in subsection (3) (a) (iii), this
15 section has effect as if the financial accommodation had been provided
to the director or associate.
(7) In this section, a reference to --
(a) the provision of financial accommodation to a director or an
associate of a director; or
20 (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 accommodation to, or an
obtaining of financial accommodation by, the director or associate, or a
25 debt owed to the director or associate, jointly with another person.
Director's remuneration
296. A director of a society (other than a director who is an employee
of the society) must not be paid any remuneration for services as a
director other than fees, concessions and other benefits that are
30 approved at a general meeting of the society.
Management contracts
297. (1) In this section --
''management contract'' means a contract or other
arrangement under which --
35 (a) a person who is not an officer of the society agrees to
perform the whole, or a substantial part, of the
functions of the society; or
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(b) a society agrees to perform the whole or a substantial
part of its functions --
(i) in a particular way; or
(ii) in accordance with the directions of any person;
5 or
(iii) subject to specified restrictions or conditions.
(2) A society must not enter into a management contract without
the prior written approval of the SSA.
Maximum penalty: $75 000.
10 (3) The SSA may subject its approval under subsection (2) to
conditions.
(4) A management contract entered into in contravention of
subsection (2) is void.
(5) A management contract entered into before the commencement
15 of this section becomes void 6 months after that commencement unless
the SSA directs that it continue in operation.
Duties of directors and officers
298. (1) An officer of a society must at all times act honestly in the
exercise of the powers and the discharge of the functions of his or her
20 office.
(2) If an officer contravenes subsection (1), the officer commits an
offence for which the maximum penalty is --
(a) if because of the contravention --
(i) the society is, or its members are, deceived or
25 defrauded; or
(ii) a creditor of the society, or a creditor of any other
person, is deceived or defrauded,
$100 000 or imprisonment for 15 years, or both; or
(b) if the contravention was committed --
30 (i) with the intention of deceiving or defrauding the
society or its members, a creditor of the society or a
creditor of any other person; or
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(ii) for any other fraudulent purpose,
but paragraph (a) does not apply, $100 000 or
imprisonment for 15 years, or both; or
(c) in any other case, $50 000 or imprisonment for 7 years, or
5 both.
(3) An officer of a society must at all times exercise a reasonable
degree of care and diligence in the exercise of the powers and the
discharge of the functions of his or her office and in the protection of
the interests of members.
10 Maximum penalty: $25 000.
(4) An officer or employee of a society, or a former officer or
employee of a society, must not make improper use of information
acquired by virtue of his or her position as such an officer or employee
to gain, directly or indirectly, an advantage for himself or herself or for
15 any other person, or to cause detriment to the society.
Maximum penalty: $100 000 or imprisonment for 15 years, or
both.
(5) An officer or employee of a society must not make improper use
of his or her position as such an officer or employee, to gain, directly or
20 indirectly, an advantage for himself or herself or for any other person,
or to cause detriment to the society.
Maximum penalty: $100 000 or imprisonment for 15 years, or
both.
(6) If --
25 (a) a person is convicted of an offence against this section; and
(b) the court by which the person is convicted is satisfied that
the society has suffered loss or 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
30 person to pay compensation to the society of an amount specified by the
court.
(7) The order may be enforced as if it were a judgment of that
court.
(8) If a person contravenes this section, the society may, whether
35 or not the person has been convicted of an offence against this section
in relation to that contravention, recover from the person as a debt due
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to the society by action in a court having jurisdiction for the recovery of
debts up to the amount concerned --
(a) if that person or any other person has made a profit as a
result of the contravention, an amount equal to that profit;
5 and
(b) if the society has suffered loss or damage as a result of the
contravention, an amount equal to that loss or damage.
(9) This section is in addition to and does not derogate from any
other rule of law relating to the duties of directors, officers and
10 employees of a society.
(10) Section 9 applies in relation to subsection (3), as if, in
subsection (1) (a) of the section, the words '', executive officer or
employee'' were omitted and the words ''or executive officer'' were
substituted.
15 Prohibition on transfer of money
299. (1) Where --
(a) an investigation is being carried out under Part 10 in
relation to an act or omission by a person, being an act or
omission that constitutes or may constitute --
20 (i) a contravention of, or an offence against, this Code; or
(ii) an offence involving fraud or dishonesty or concerning
the management of affairs of a society; or
(b) a prosecution has been instituted against a person for an
offence against this Code; or
25 (c) a civil proceeding has been instituted against a person
under this Code,
and the Court considers it necessary or desirable to do so for the
purpose of protecting the interests of a person (in this section called an
''aggrieved person'') to whom the person mentioned in paragraph (a),
30 (b) or (c), as the case may be, (in this section called the ''relevant
person''), is liable, or may be or become liable, to pay money, whether
in relation to a debt, by way of damages or compensation or otherwise,
or to account for securities or other property, the Court may, on
application by the SSA or by an aggrieved person, make one or more of
35 the following orders --
(d) an order prohibiting a person who is indebted to the
relevant person or to an associate of the relevant person
from making a payment in total or partial discharge of the
debt to, or to another person at the direction or request of,
40 the person to whom the debt is owed;
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(e) an order prohibiting a person holding money, securities or
other property, on behalf of the relevant person, or on
behalf of an associate of the relevant person, from paying
all or any of the money, or transferring, or otherwise
5 parting with possession of, the securities or other property,
to, or to another person at the direction or request of, the
person on whose behalf the money, securities or other
property, is or are held;
(f) an order prohibiting the taking or sending out of Australia
10 by a person of money of the relevant person or of an
associate of the relevant person;
(g) an order prohibiting the taking, sending or transfer by a
person of securities or other property of the relevant person,
or of an associate of the relevant person --
15 (i) from a place in this State to a place outside this State
(including the transfer of securities from a register in
this State to a register outside this State); or
(ii) from a place in Australia to a place outside Australia
(including the transfer of securities from a register in
20 Australia to a register outside Australia);
(h) an order appointing --
(i) if the relevant person is an individual, a receiver or
trustee, having such powers as the Court orders, of
the property or of part of the property of that person;
25 or
(ii) if the relevant person is a body corporate, a receiver
having such powers as the Court orders, of the
property or of part of the property of that person;
(i) if the relevant person is an individual, an order requiring
30 that person to deliver up to the Court his or her passport
and any other documents the Court considers appropriate;
(j) if the relevant person is an individual, an order prohibiting
that person from leaving Australia without the consent of
the Court.
35 (2) A reference in subsection (1) (g) or (h) to property of a person
includes a reference to property that the person holds otherwise than as
sole beneficial owner, for example --
(a) as trustee for, as nominee for, or otherwise on behalf of or
on account of, another person; or
40 (b) in a fiduciary capacity.
(3) An order under subsection (1) prohibiting conduct may prohibit
the conduct either absolutely or subject to conditions.
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(4) Where an application is made to the Court for an order under
subsection (1), the Court may, if in the opinion of the Court it is
desirable to do so, before considering the application, grant an interim
order, being an order of the kind applied for that is expressed to have
5 effect pending the determination of the application.
(5) On an application under subsection (1), the Court must not
require the applicant or any other person, as a condition of granting an
interim order under subsection (3), to give an undertaking as to
damages.
10 (6) Where the Court has made an order under this section on a
person's application, the Court may, on application by that person or by
any person affected by the order, make a further order discharging or
varying the first-mentioned order.
(7) An order under subsection (1) or (2) may be expressed to
15 operate for a specified period or until the order is discharged by a
further order under this section.
(8) This section has effect subject to the Bankruptcy Act 1966 of
the Commonwealth.
(9) A person must not contravene an order by the Court under this
20 section that is applicable to the person.
Maximum penalty: $100 000 or imprisonment for 15 years, or
both.
Unlawfully acting as director
300. (1) A person, who is not the director of a society, or the
25 alternate director of such a director, must not purport to act as a
director of a society.
(2) A director of a society must not permit a person who is not a
director of the society, or the alternate director of such a director, to
purport to act as a director of the society.
30 Maximum penalty: $100 000 or imprisonment for 15 years, or
both.
Division 3 -- Meetings of Members of a Society
Annual general meeting
301. (1) The first annual general meeting of a society must be held
35 within 18 months after it is registered under this Code.
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(2) The second and every subsequent annual general meeting of a
society must be held within 5 months after the close of its financial
year, or within any further time allowed by the SSA or prescribed.
(3) A society that fails to hold an annual general meeting as
5 required by this section commits an offence.
Maximum penalty applying to subsection (3): $5 000.
Special general meeting
302. (1) The board of a society may convene a special general
meeting of the society.
10 (2) The board of a society must immediately proceed to convene a
special general meeting of the society if required to do so by not less
than the number of members prescribed for that purpose by the
society's rules.
Quorum
15 303. (1) A general meeting of a society must not deal with an item
of business unless a quorum is present.
(2) Subsection (1) does not apply to an item of business that may
be dealt with by postal voting under the society's rules.
(3) A quorum is as prescribed by the society's rules.
20 Notice of meeting
304. (1) Subject to subsection (2) --
(a) written notice of an annual general meeting must be given
personally or by post to each member of the society at least
14 days before the date of the meeting; and
25 (b) written notice of a special general meeting must be given
personally or by post to each member of the society at least
7 days before the date of the meeting.
(2) If the society's rules so provide, notice of an annual general
meeting or special general meeting may be given to the members of the
30 society by advertisement published in a newspaper circulating
generally --
(a) in the area of this State in which the society operates; and
(b) if the society operates in another State, or other States, in
the other State or States.
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(3) Notice of a general meeting of a society must be displayed in a
conspicuous place at the registered office and each other office of the
society over a period of at least --
(a) in the case of an annual general meeting, 14 days
5 immediately before the date of the meeting; and
(b) in the case of a special general meeting, 7 days immediately
before the date of the meeting.
(4) The failure by a member of a society to receive notice of a
general meeting required to be given to the member by this Code does
10 not invalidate the meeting.
(5) A society that fails to give notice of an annual general meeting,
or a special general meeting, or to display notice of a general meeting in
accordance with this section commits an offence and is liable on
conviction to a maximum penalty of $5 000.
15 Voting
305. (1) Subject to this section, a member of a society is entitled to
exercise one vote on any question arising for determination by the
society's members.
(2) A society's rules may provide that a member's entitlement to
20 vote as a member may not be exercised unless the member satisfies one
or more of the following --
(a) the member has an interest in a benefit fund of the society;
(b) the member has been a member of a benefit fund for not
less than the minimum period prescribed by the society's
25 rules;
(c) the member has, or had at a certain time, or has had for a
certain period, a specified minimum interest in a benefit
fund as prescribed by the society's rules;
(d) the member has made contributions to a benefit fund in
30 accordance with the society's rules and complied with any
terms and conditions for the provision of benefits from that
fund;
(e) the member holds at a certain time, or has held for a
certain period, a specified minimum amount of paid-up
35 share capital.
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(3) Subject to subsection (2) (e) and section 236 (3) (b), a member
of a society who has permanent shares in the society has --
(a) one vote; or
(b) if the rules so provide, 2 or more votes determined by the
5 number of permanent shares, or parcels of paid-up share
capital held by the member (but in any case not more votes
than the number of permanent shares held by the member),
whichever is the greater.
(4) The SSA must not register rules referred to in subsection (2)
10 unless it approves --
(a) in the case of subsections (2) (b) and (2) (c), the minimum
period or the minimum interest in a benefit fund (as the
case requires); or
(b) in the case of subsection (2) (d), the terms and conditions
15 for provision of benefits; or
(c) in the case of subsection (2) (e), the minimum amount of
paid-up share capital.
(5) A member of a society appointed to represent a corporate
member of the society may vote both as a member and as such a
20 representative.
Proxy votes
306. (1) The rules of a society may provide --
(a) that proxy voting is allowed at a meeting of the society;
(b) that a proxy may specify the way in which the member
25 giving the proxy wishes the vote to be exercised;
(c) that a person who is not a member may be appointed as
proxy for a member.
(2) A person appointed as a proxy --
(a) may not act as a proxy for more than 10 members who do
30 not specify the way the vote is to be exercised;
(b) may act as a proxy for an unlimited number of members
who specify the way the vote is to be exercised.
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Special resolutions of societies
307. (1) For the purposes of this Code, a special resolution of
members of a society is a resolution passed by a majority of not less
than two-thirds of those members of the society who, being entitled to
5 vote --
(a) in any case, vote, either personally or by proxy, at a
meeting of the society at which a motion for the passing of
the resolution is moved and vote on the resolution; or
(b) in the case of a merger of societies or transfer of
10 engagements under Part 7, vote on the resolution by a
postal ballot conducted in accordance with the regulations.
(2) In the case of a special resolution passed at a meeting of a
society, unless a poll is demanded, a declaration by the person presiding
at the meeting that a resolution has been carried by a specified
15 majority is conclusive evidence of the fact.
(3) Subject to subsection (4), written notice of a proposed special
resolution, containing the text or a summary of the resolution, must be
given personally or by post to each member of the society who is
entitled to vote on the resolution at least 21 days before the date of the
20 meeting or close of the postal ballot.
(4) If the rules of the society so provide, notice of a proposed
special resolution, containing the text or a summary of the resolution,
may be given to the members of the society entitled to vote on the
resolution by advertisement published in a newspaper circulating
25 generally --
(a) in the area of this State in which the society operates; and
(b) if the society operates in another State, or other States, in
the other State or States.
(5) A purported special resolution of members of a society in
30 relation to which notice has not been given in accordance with
subsection (3) or (4) is of no effect.
(6) However, the failure by a member of a society to receive notice
of a proposed special resolution does not invalidate the passing of the
resolution.
35 (7) A society must, within one month after a special resolution has
been passed, submit the resolution to the SSA for registration.
(8) A special resolution of members of a society is of no effect until
registered.
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(9) The SSA must register a special resolution of a society if
satisfied that --
(a) the special resolution is not contrary to --
(i) the friendly societies legislation; or
5 (ii) the standards; and
(b) there is no good reason why the special resolution should
not be registered.
(10) This section applies in relation only to those matters that are
required by this Code or a society's rules to be passed or approved by a
10 special resolution of members of a society.
Minutes
308. A society must cause full and accurate minutes to be kept of
every meeting of its members.
Maximum penalty: $25 000.
15 Division 4 -- Meetings of Members of a Benefit Fund
Application of Division
309. This Division applies to meetings of members of a benefit fund
of a society for the purpose of --
(a) approving a restructure of a benefit fund under Division 3
20 of Part 4A;
(b) approving the termination of a benefit fund under Division
4 of Part 4A;
(c) a special meeting under section 43;
(d) a meeting of members of a benefit fund held pursuant to
25 the society's rules.
Quorum
310. (1) A meeting of members of a benefit fund must not deal with
an item of business unless a quorum is present.
(2) A quorum is as prescribed by the society's rules.
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Notice of meeting
311. (1) Subject to subsection (2), written notice of a meeting of
members of a benefit fund must be given personally or by post to each
member of the benefit fund at least 7 days before the date of the
5 meeting.
(2) If the society's rules so provide, notice of a meeting of members
of a benefit fund may be given to the members of the benefit fund by
advertisement published in a newspaper circulating generally --
(a) in the area of this State in which the society operates; and
10 (b) if the society operates in another State, or other States, in
the other State or States.
(3) Notice of a meeting of members of a benefit fund must be
displayed in a conspicuous place at the registered office and each other
office of the society over a period of at least 7 days immediately before
15 the date of the meeting.
(4) The failure by a member of a benefit fund to receive notice of a
meeting required to be given to the member by this Code does not
invalidate the meeting.
(5) A society that fails to give notice of a meeting of members of a
20 benefit fund, or to display notice of such a meeting, in accordance with
this section commits an offence and is liable on conviction to a
maximum penalty of $5 000.
Voting
312. (1) Subject to this section, a member of a benefit fund is
25 entitled to exercise one vote on any question arising for determination
by the members of the benefit fund.
(2) A society's rules may provide that a member's entitlement to
vote as a member of a benefit fund may not be exercised unless the
member satisfies one or more of the following --
30 (a) the member has been a member of the benefit fund for not
less than the minimum period prescribed by the society's
rules;
(b) the member has, or had at a certain time, or has had for a
certain period, a specified minimum interest in the benefit
35 fund prescribed by the society's rules;
(c) the member has made contributions to the benefit fund in
accordance with the society's rules and complied with any
terms and conditions for the provision of benefits from that
fund.
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(3) The SSA must not register rules referred to in subsection (2)
unless it approves the minimum period or interest specified in the
rules.
(4) A member of a benefit fund appointed to represent a corporate
5 member of the benefit fund may vote both as a member and as such a
representative.
Proxy votes
313. (1) The rules of a society may provide --
(a) that proxy voting is allowed at a meeting of the members of
10 a benefit fund;
(b) that a proxy may specify the way in which the member of
the benefit fund giving the proxy wishes the vote to be
exercised;
(c) that a person who is not a member of the benefit fund may
15 be appointed as proxy for a member.
(2) A person appointed as a proxy --
(a) may not act as a proxy for more than 10 members of a
benefit fund who do not specify the way the vote is to be
exercised;
20 (b) may act as a proxy for an unlimited number of members of
a benefit fund who specify the way the vote is to be
exercised.
Special resolutions of benefit funds
314. (1) For the purposes of this Code, a special resolution of
25 members of a benefit fund is a resolution passed by a majority of not
less than two-thirds of those members of the benefit fund who, being
entitled to vote, vote, either personally or by proxy, at a meeting of
members of the benefit fund at which a motion for the passing of the
resolution is moved and vote on the resolution.
30 (2) Unless a poll is demanded, a declaration by the person
presiding at a meeting that a resolution has been carried by a specified
majority is conclusive evidence of the fact.
(3) Subject to subsection (4), written notice of a proposed special
resolution, containing the text or a summary of the resolution, must be
35 given personally or by post to each member of the benefit fund who is
entitled to vote on the resolution at least 21 days before the date of the
meeting.
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(4) If the rules of the society so provide, notice of a proposed
special resolution, containing the text or a summary of the resolution,
may be given to members of the benefit fund entitled to vote on the
resolution by advertisement published in a newspaper circulating
5 generally --
(a) in the area of the State in which the society operates; and
(b) if the society operates in another State, or other States, in
the other State or States.
(5) A purported special resolution of members of a benefit fund in
10 relation to which notice has not been given in accordance with
subsection (3) or (4) is of no effect.
(6) However, the failure by a member of a benefit fund to receive
notice of a proposed special resolution does not invalidate the passing of
the resolution.
15 (7) This section applies in relation only to those matters that are
required by this Code or a society's rules to be passed or approved by a
special resolution of members of a benefit fund.
Minutes
315. A society must cause full and accurate minutes to be kept of
20 every meeting of members of its benefit funds.
Maximum penalty: $25 000.
Division 5 -- Registers and Inspection
Registers
316. (1) A society must keep such registers as are prescribed.
25 Maximum penalty: $25 000.
(2) Subject to this section, all registers required to be kept by a
society (whether under this section or any other provision of this Code)
must be kept at the registered office of the society and be kept in such
way, and contain such particulars, as may be prescribed.
30 Maximum penalty: $5 000.
(3) With the written consent of the SSA, all or any of the registers
may be kept at an office of the society other than its registered office.
(4) A society may, as authorized by its rules, make an entry in any
of its registers or accounts to indicate that money received by it is held
35 in trust, but is not to be regarded as being affected by notice of any
trust in relation to the money whether or not any such entry is made.
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Register of directors etc.
317. (1) In determining for the purposes of this section whether a
person has a relevant interest in a security issued by a body corporate,
section 252 applies as if a reference in that section to a share were a
5 reference to a security.
(2) A society must keep a register of its directors and secretaries
in accordance with subsections (3) and (4).
Maximum penalty: $25 000.
(3) The register must show in relation to each director of the
10 society --
(a) the present given name and surname, any former given
name or surname, the date and place of birth, the usual
residential address and the business occupation (if any) of
the director; and
15 (b) particulars of directorships held by the director in bodies
corporate (other than related bodies corporate) --
(i) that are public companies or subsidiaries of public
companies; or
(ii) that are other societies or foreign societies; or
20 (iii) that are financial institutions within the meaning of
the Financial Institutions Code of a State; and
(c) securities issued by the society in which the director has a
relevant interest, and the nature and extent of the interest;
and
25 (d) securities issued by a body corporate that is related to the
society, being securities in which the director has a relevant
interest, and the nature and extent of that interest; and
(e) particulars of rights or options of the director, or of the
director and another person, in relation to the acquisition or
30 disposal of securities issued by the society or a body
corporate that is related to the society; and
(f) particulars of contracts to which the director is a party or
under which he or she is entitled to a benefit, being
contracts under which a person has a right to call for or to
35 make delivery of securities issued by the society or a body
corporate that is related to the society; and
(g) whether the director is entitled to an interest in a benefit
fund of the society and, if so, the name of that benefit fund.
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(4) The register must show in relation to each secretary the
present given name and surname, any former given name or surname,
the date and place of birth, the usual residential address and the
business occupation (if any), of the secretary.
5 (5) A society need not show in its register in relation to a director
particulars of securities issued by a body corporate that is related to the
society and is a wholly owned subsidiary of the society.
(6) A society must, within 7 days after receiving notice from a
director under section 293 (1) (a), enter in its register, in relation to the
10 director, the particulars specified in subsection (3) of this section,
including the number and description of securities, rights, options and
contracts and any entitlement to an interest in a benefit fund of the
society to which the notice relates and, in relation to securities, rights
or options acquired or contracts entered into after he or she became a
15 director --
(a) the price or other consideration for the transaction (if any)
because of which an entry is required to be made in the
register; and
(b) the date of --
20 (i) the agreement for the transaction or, if it is later, the
completion of the transaction; or
(ii) if there was no transaction, the happening of the
event because of which an entry is required to be
made in the register.
25 Maximum penalty: $25 000.
(7) A society must, within 3 days after receiving a notice from a
director under section 293 (1) (b), enter in its register the particulars of
the change specified in the notice.
Maximum penalty: $25 000.
30 (8) A society is not, because of anything done under this section, to
be taken for any purpose to have notice of, or to be on inquiry as to, the
right of a person to or in relation to a security issued by the society or
an interest in any benefit fund of the society.
(9) A society must lodge with the SSA --
35 (a) within one month after a person has become, or ceased to
be, a director or a secretary of the society, a return in the
prescribed form advising that fact and containing in
relation to a new director or secretary the matters required
by subsection (3) or (4) to be shown in the register;
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(b) within one month after receiving a notice from a director or
secretary of a change in the matters required by
subsection (3) or (4) to be shown in the register, a return in
the prescribed form advising the particulars of the change
5 specified in the notice.
Maximum penalty: $500.
(10) A register kept by a society under this section must be open
for inspection --
(a) by any member of the society, without fee; and
10 (b) by any other person, on payment for each inspection of the
amount (if any) prescribed by the society's rules.
(11) A society must produce its register at the start of each annual
general meeting of the society and keep it open and accessible during
the meeting to all persons attending the meeting.
15 Maximum penalty: $5 000.
(12) It is a defence to a prosecution for failing to comply with
subsection (3) or (6) in relation to particulars relating to a director if
the defendant proves that the failure was due to the failure of a
director to comply with section 293 in relation to those particulars.
20 (13) In this section --
''security'' does not include benefit in a benefit fund.
Register of members to be kept
318. (1) A society must keep a register of members of the society
and enter in the register --
25 (a) the names and addresses of the members; and
(b) the date of admission to membership of the society; and
(c) any other prescribed information.
Maximum penalty: $25 000.
(2) A society must, for each of its benefit funds, keep a register of
30 members and enter in the register --
(a) the names and addresses of the members of the benefit
fund; and
(b) the date of admission to membership of the benefit fund;
and
35 (c) any other prescribed information.
Maximum penalty: $25 000.
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Registers of members
319. (1) The register of members of a society is evidence of
membership of the society.
(2) The register of members of a benefit fund is evidence of
5 membership of the benefit fund.
(3) A member of a society is entitled to have access to that part of
a register of members in which particulars of his or her membership
are entered.
(4) A society may refuse to allow a person, other than a member
10 mentioned in subsection (3), to have access to a register unless the
person satisfies the society that the person requires access for the
purpose of --
(a) calling a meeting of members of the society or a benefit
fund; or
15 (b) undertaking some other activity approved by the SSA.
(5) Before a society allows a person, who has satisfied the society
in accordance with subsection (4), to have access to a register, the
society may require the person to enter into a contract with the society
under which the person undertakes --
20 (a) to restrict access to the information obtained by the person
from the register to persons identified in the contract; and
(b) to restrict use of the information obtained by the person
from the register to a specified purpose.
(6) If a register includes the numbers of certificates or other
25 documents evidencing the holdings of its members of shares (if any)
allocated to them, nothing in subsections (3) to (5) requires --
(a) a person to be allowed to see the numbers when inspecting
the register; or
(b) a copy of the register, or a part of it, sent to a person to
30 contain those numbers.
Register of holders of permanent shares
320. (1) A society must keep a register of holders of permanent
shares in the society and enter in that register --
(a) the names and addresses of those holders; and
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(b) the date of every allotment of any permanent shares to
holders and the number of permanent shares comprised in
each allotment; and
(c) the date of entry of a transfer or transmission of any
5 permanent shares to holders and the number of permanent
shares comprised in each transfer or transmission; and
(d) any other prescribed information.
Maximum penalty: $25 000.
(2) The register of holders of permanent shares in a society is
10 evidence of ownership of permanent shares in the society.
(3) A holder of permanent shares in a society is entitled to have
access to that part of the register of holders of permanent shares in
which particulars of his or her shareholding are entered.
(4) A society may refuse to allow a person, other than a holder of
15 permanent shares mentioned in subsection (3), to have access to the
register of holders of permanent shares unless the person satisfies the
society that the person requires access for the purpose of --
(a) calling a meeting of permanent shareholders; or
(b) making an offer to acquire permanent shares; or
20 (c) undertaking some other activity approved by the SSA.
(5) Before a society allows a person, who has satisfied the society
in accordance with subsection (4), to have access to the register of
holders of permanent shares, the society may require the person to
enter into a contract with the society under which the person
25 undertakes --
(a) to restrict access to the information obtained by the person
from the register to persons identified in the contract; and
(b) to restrict use of the information obtained by the person
from the register to a specified purpose.
30 (6) Nothing in subsections (3) to (5) requires --
(a) a person to be allowed to see the numbers of the certificates
that have been issued evidencing the holding of permanent
shares; or
(b) a copy of the register, or part of it, sent to a person to
35 contain those numbers.
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Power of Court to rectify register of holders of permanent
shares
321. (1) If --
(a) an entry is omitted from the register of holders of
5 permanent shares; or
(b) an entry is made in the register without sufficient cause; or
(c) an entry wrongly exists in the register; or
(d) there is an error or defect in an entry in the register; or
(e) default is made, or unnecessary delay takes place, in
10 entering in the register the fact of any person having
ceased to be a holder of permanent shares,
the person aggrieved, or any member or the society, may apply to the
Court for rectification of the register and the Court may refuse the
application or may order rectification of the register and payment by
15 the society of any damages sustained by any party to the application.
(2) On an application under this section, the Court may decide --
(a) any question relating to the right of a person who is a party
to the application to have his or her name entered in or
omitted from the register, whether the question arises
20 between --
(i) a holder, or alleged holder, of permanent shares on
the one hand and another holder, or alleged holder, of
permanent shares on the other hand; or
(ii) a holder, or alleged holder, of permanent shares on
25 the one hand and the society on the other hand; and
(b) generally any question necessary or expedient to be decided
in relation to the rectification of the register.
(3) If a society is required by this Code to lodge a return
containing a list of holders of permanent shares with the SSA, the
30 Court, when making an order for rectification of the register, is by its
order to direct a notice of the rectification to be so lodged.
Register of options
322. (1) A society must keep a register of options granted to
persons to take up permanent shares in the society.
35 Maximum penalty: $25 000.
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(2) A society must, within 14 days after the grant of an option to
take up permanent shares in the society, enter in the register the
following particulars --
(a) the name and address of the holder of the option;
5 (b) the date on which the option was granted;
(c) the number and description of the shares in relation to
which the option was granted;
(d) the period during which, the time at which or the
occurrence on the happening of which the option may be
10 exercised;
(e) the consideration (if any) for the grant of the option;
(f) the consideration (if any) for the exercise of the option or
the way in which that consideration is to be ascertained or
determined;
15 (g) such other particulars as are prescribed.
Maximum penalty: $25 000.
(3) The register must be kept open for inspection --
(a) by any member of the society, without fee; and
(b) by any other person, on payment for each inspection of the
20 amount (if any) prescribed by the society's rules.
Maximum penalty: $5 000.
(4) A society must keep, at the place where the register is kept, a
copy of every instrument by which an option to take up permanent
shares in the society is granted and, for the purposes of subsection (3)
25 and section 323 (4), those copies are taken to be part of the register.
Maximum penalty: $25 000.
(5) Failure by a society to comply with any of the provisions of this
section in relation to an option does not affect any rights in relation to
the option.
30 Inspection of rules and other documents
323. (1) A society must keep at its registered office available for
inspection without fee by members of the society, persons eligible for
membership of the society and its creditors --
(a) a copy of this Code and the regulations; and
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(b) a copy of the AFIC Code and the regulations in force for the
purposes of that Code; and
(c) a copy of the rules of the society; and
(d) a copy of the last accounts of the society, together with a
5 copy of the report of the auditor on those accounts; and
(e) a copy of the last directors' report under section 336.
(2) A society must keep a copy of its rules available for inspection
without fee by members of the society at each office of the society.
(3) A society must, on request by a member of the society, give the
10 member particulars of his or her financial position with the society as a
member or shareholder.
(4) Subject to the regulations and to sections 318 and 319, a
member may request a society to give him or her a copy of a register or
any part of a register kept by the society under this Code and, where
15 such a request is made, the society must send the copy to the
member --
(a) if the society requires payment of an amount prescribed by
the rules, within 21 days after payment of the amount is
received by the society or within such longer period as the
20 SSA approves; or
(b) in any other case, within 21 days after the request is made
or within such longer period as the SSA approves.
Maximum penalty: $5 000.
Location of registers on computers
25 324. (1) This section applies despite anything in this Division to
the contrary.
(2) This section applies if --
(a) a society records, otherwise than in writing, matters (the
''stored matters'') this Division requires to be contained in
30 a register; and
(b) the record of stored matters is kept at a place (the ''place
of storage'') other than the place (the ''place of
inspection'') where the register is, apart from this section,
required to be kept; and
35 (c) at the place of inspection means are provided by which the
stored matters are made available for inspection in written
form; and
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(d) the society has served the SSA with a notice stating that
this section is to apply to --
(i) unless sub-paragraph (ii) applies, the register; or
(ii) if the stored matters are only some of the information
5 that is required to be contained in the register, the
register and matters that are of the same kind as the
stored matters,
and specifying the situation of the place of storage and the
place of inspection.
10 (3) The society is taken to have complied with the requirements of
this Division about the location of the register, but only as far as the
register is required to contain the stored matters.
(4) However, if --
(a) the situation of the place of storage or the place of
15 inspection changes; and
(b) the society does not serve notice of the change within
14 days after the change,
this section, as it applies to the society because of the serving of the
notice mentioned in subsection (2) (d), ceases to apply at the end of the
20 14 days.
Form and evidentiary value of registers
325. (1) A register that is required by this Division to be kept or
prepared may be kept or prepared --
(a) by making entries in a bound or loose-leaf book; or
25 (b) by recording or storing matters using a mechanical,
electronic or other device; or
(c) in another way approved by the SSA.
(2) Subsection (1) does not authorize a register to be kept or
prepared by a mechanical, electronic or other device unless --
30 (a) the matters recorded or stored will be capable, at any time,
of being reproduced in a written form; or
(b) a reproduction of the matters is kept in written form
approved by the SSA.
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(3) A society must take all reasonable precautions, including the
precautions (if any) prescribed, for guarding against damage to,
destruction of or falsification of or in, and for discovery of falsification of
or in, any register or part of a register required by this Division to be
5 kept or prepared by the society.
(4) If a society records or stores matters using a mechanical,
electronic or other device, a duty imposed by this Division to make a
register containing the matters available for inspection or to provide
copies of the whole or a part of a register containing the matters is
10 taken to be a duty to make the matters available for inspection in
written form or to provide a document containing a clear reproduction
in writing of the whole or part of them, as the case may be.
(5) A regulation may provide for how up-to-date the information
contained in an instrument prepared for subsection (4) must be.
15 (6) If --
(a) because of this Code, a register that this Division requires
to be kept or prepared is evidence of a matter; and
(b) the register, or part of the register, is kept or prepared by
recording or storing matters (including the matter) using a
20 mechanical, electronic or other device,
a written reproduction of the matter as so recorded or stored is evidence
of the matter.
(7) A writing purporting to reproduce a matter recorded or stored
using a mechanical, electronic or other device is taken to be a
25 reproduction of the matter unless the contrary is established.
Division 6 -- Accounts
Financial year
326. (1) The financial year of a society is the period from 1 July to
the following 30 June.
30 (2) If a society is registered (otherwise than as a result of a
merger) on a day falling between 1 January and 30 June in any year,
its first financial year may, if the society so elects, extend to 30 June in
the following year.
(3) Despite subsection (1), but subject to subsection (4), if at the
35 commencement of this section the financial year of a society is a period
other than that specified in subsection (1), the society may retain that
period as its financial year.
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(4) If the SSA by written notice given to the society directs it to
comply with subsection (1), the society must do so within 2 years of
receiving the notice.
Maximum penalty applying to subsection (4): $5 000.
5 Financial years of groups
327. (1) Subject to --
(a) this section; and
(b) where the entity is formed or incorporated outside
Australia, any law in force in the entity's place of formation
10 or incorporation,
a society's directors must do whatever is necessary to ensure that the
financial year of each entity that the society controls coincides with the
financial year of the society.
(2) Subsection (1) must be complied with in relation to a particular
15 entity within 12 months after --
(a) if the society controlled the entity at the commencement of
this section, that commencement; or
(b) if the society is taken to control the entity by virtue of a
regulation made for the purposes of this Code or an
20 applicable accounting standard, the date of the regulation
or accounting standard taking effect; or
(c) in any other case, the society began to control the entity.
Accounting records to be kept
328. (1) A society must --
25 (a) keep accounting records that correctly record and explain
the transactions (including any transactions by the society
as trustee) and the financial position of the society and each
of its funds; and
(b) keep the accounting records in a way that will enable --
30 (i) true and fair accounts of the society and each of its
funds to be prepared periodically; and
(ii) the accounts of the society and each of its funds to be
conveniently and properly audited in accordance with
this Part; and
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(c) retain the accounting records for a period of 7 years after
the completion of the transactions to which they relate; and
(d) keep accounting records in writing in the English language
or in a form which enables the accounting records to be
5 readily accessible and readily convertible into writing in the
English language; and
(e) keep the accounting records at such a place or places as its
directors think fit.
(2) If any of the accounting records of a society are kept at a place
10 outside this State, the society must keep at a place within this State
determined by the directors such information as would enable true and
fair accounts, and any documents or reports required by this Part to be
attached to the accounts, to be prepared.
Maximum penalty: $75 000.
15 Inspection of accounting records
329. (1) A society must make its accounting records available at all
reasonable times for inspection without fee by any director of the
society and by any other person authorized or permitted under the
friendly societies legislation to inspect the accounting records.
20 Maximum penalty: $75 000.
(2) The Court may, on application by a director of a society, make
an order authorizing a registered company auditor acting for the
director to inspect the accounting records of the society.
(3) A registered company auditor who inspects accounting records
25 under a Court order must not disclose to a person other than the
director on whose application the order was made any information
acquired during the inspection.
Maximum penalty: $50 000 or imprisonment for 7 years, or both.
(4) The cost of an inspection conducted under a Court order must
30 be met by the society.
Profit and loss accounts and balance sheets
330. The directors of a society must, before the day on which notice of
an annual general meeting of the society is given or, if an annual
general meeting is not held within the period within which it is
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required by section 301 to be held, not less than 21 days before the end
of the period, cause to be prepared --
(a) profit and loss accounts for the last financial year giving a
true and fair view of the profit or loss of the society and
5 each of its funds for that financial year; and
(b) balance sheets as at the end of the last financial year
giving a true and fair view of the state of affairs of the
society and each of its funds as at the end of that financial
year.
10 Group accounts
331. If at the end of a financial year of a society, the society is a
holding society, the directors of the society must --
(a) before the day on which notice of the next annual general
meeting of the society is given; or
15 (b) if an annual general meeting is not held within the period
within which it is required by section 301 to be held, not
less than 21 days before the end of that period,
cause to be prepared --
(c) a consolidated profit and loss account that gives a true and
20 fair view of the profit or loss, for that financial year, of the
economic entity constituted by the society and the entities it
controlled from time to time during that financial year
(even if the society did not control the same entities during
all of that financial year); and
25 (d) a consolidated balance sheet, as at the year's end, that
gives a true and fair view of the state of affairs as at the
year's end, of the economic entity constituted by the society
and the entities that it controls at the year's end,
so far as such a true and fair view of the profit and loss and state of
30 affairs concern members of the holding society.
Audit
332. (1) The directors of a society must take reasonable steps to
ensure that the accounts and group accounts are audited as required by
this Part before the day before which the accounts are required by this
35 Division to have been prepared.
(2) The directors of a society must cause to be attached to, or
endorsed on, the accounts or group accounts the auditor's report given
to the directors under Division 7.
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Directors to ascertain certain matters
333. Before the profit and loss accounts and balance sheets are
prepared, the directors of a society must take reasonable steps --
(a) to ascertain what action has been taken in relation to the
5 writing off of bad debts and the making of provisions for
doubtful debts and to cause all known bad debts to be
written off and adequate provision to be made for doubtful
debts; and
(b) to ascertain whether any current assets, other than current
10 assets to which paragraph (a) applies, are unlikely to
realize in the ordinary course of business their value as
shown in the accounting records of the society and, if so, to
cause --
(i) those assets to be written down to an amount that
15 they might be expected so to realize; or
(ii) adequate provision to be made for the difference
between the amount of the value as so shown and the
amount that they might be expected so to realize; and
(c) to ascertain whether any non-current asset is shown in
20 documents of the society at an amount that, having regard
to its value to the society as a going concern, exceeds the
amount that it would have been reasonable for the society
to spend to acquire that asset as at the end of the financial
year and, unless adequate provision for writing down that
25 asset is made, to cause to be included in the accounts such
information and explanations as will prevent the accounts
from being misleading because of the overstatement of the
amount of that asset.
Requirements applying to accounts and group accounts
30 334. (1) The directors of a society must ensure that the accounts
and group accounts --
(a) comply with the prescribed requirements; and
(b) comply with applicable accounting standards.
(2) AFIC may, by Gazette notice, declare an accounting standard to
35 be an applicable accounting standard in relation to the accounts and
group accounts, subject to any modifications that are specified in the
notice.
(3) AFIC may, by Gazette notice, vary or revoke a notice under
subsection (2).
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(4) If accounts or group accounts prepared in accordance with
subsection (1) would not otherwise give a true and fair view of the
matters required by this section to be dealt with in those accounts, the
directors of the society must add such information and explanations as
5 will give a true and fair view of those matters.
Directors' statement
335. (1) The directors of a society must cause to be attached to any
accounts required to be laid before an annual general meeting, before
the auditor reports on those accounts, a statement made in accordance
10 with a resolution of the directors and signed by not less than 2 directors
stating whether in the opinion of the directors --
(a) the profit and loss accounts are drawn up so as to give a
true and fair view of the profit or loss of the society and
each of its funds for the financial year; and
15 (b) the balance sheets are drawn up so as to give a true and
fair view of the state of affairs of the society and each of its
funds as at the end of the financial year; and
(c) as at the date of the statement, there are reasonable
grounds to believe that the society will be able to pay its
20 debts as and when they fall due.
(2) The directors of a society that is a holding society must cause
to be attached to group accounts required to be laid before an annual
general meeting, before the auditor reports on those accounts, a
statement made in accordance with a resolution of the directors and
25 signed by not less than 2 directors stating whether, in the opinion of
the directors, the group accounts are so drawn up as to give a true and
fair view of --
(a) the profit or loss of the society and the entities it controlled
during all or part of the last financial year; and
30 (b) the state of affairs of the society and the entities it
controlled as at the end of the last financial year,
so far as they concern members of the society.
(3) The directors of a society --
(a) must, in forming an opinion as to the matters mentioned in
35 subsection (1) (a) and (b) for the purposes of a statement
under that subsection, have regard to circumstances that
have arisen and information that has become available,
since the end of the financial year to which the accounts
relate, being circumstances or information that would, if the
40 accounts were being prepared at the time the statement is
made, have affected the determination of an amount or a
particular in those accounts; and
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(b) must, if adjustments have not been made in those accounts
to reflect circumstances or information of a kind mentioned
in paragraph (a), being circumstances or information
relevant to an understanding of those accounts, or of an
5 amount or particular in those accounts, include in the
statement such information and explanations as will
prevent those accounts, or that amount or particular, from
being misleading as a result of those adjustments not
having been made.
10 (4) The directors of a society that is a holding society --
(a) must, in forming an opinion as to the matters mentioned in
subsection (2) (a) and (b) for the purposes of a statement
under that subsection, have regard to circumstances that
have arisen, or information that has become available,
15 since --
(i) in the case of circumstances or information relating to
the society, the end of the financial year of the society
to which the group accounts relate; or
(ii) in the case of circumstances or information relating to
20 an entity controlled by the society, the end of the
financial year of the entity to which the group
accounts relate,
being circumstances or information that would, if the group
accounts were being prepared at the time the statement is
25 made, have affected the determination of an amount or a
particular in those group accounts; and
(b) must, if adjustments have not been made in those group
accounts to reflect circumstances or information of a kind
mentioned in paragraph (a), being circumstances or
30 information relevant to an understanding of those group
accounts, or of an amount or particular in those group
accounts, include in the statement such information and
explanations as will prevent those group accounts, or that
amount or particular, from being misleading as a result of
35 those adjustments not having been made.
Directors' reports
336. (1) The directors of a society, other than a society to which
subsection (2) applies, must, before (but not more than 3 weeks before)
the day before which the accounts for its last financial year are
40 required under this Division to be prepared, cause to be prepared a
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report, prepared in accordance with a resolution of the directors and
signed by at least 2 directors --
(a) stating the names of the directors in office at the date of
the report and specifying for each director --
5 (i) the qualifications, experience and special
responsibilities (if any) of the director; and
(ii) the number, type and class of any securities or any
entitlement to an interest in a benefit fund of the
society for which the society is required to keep
10 particulars, for the director, under section 317; and
(iii) any interest of the director in a contract or proposed
contract with the society, being an interest declared
by the director under Division 2 since the
commencement of this section or the date on which
15 particulars were last given under this paragraph; and
(b) stating that --
(i) the society keeps a register under section 317
containing information about the directors, including
details of each director's interests in securities issued
20 by the society or in a benefit fund of the society
(where applicable); and
(ii) the register is open for inspection by any member of
the society, without fee, and by any other person, on
payment of the amount (if any) prescribed by the
25 society's rules; and
(c) stating --
(i) the principal activities of the society during its last
financial year and any significant change in the
nature of those activities that happened during that
30 financial year; and
(ii) the net amount of the profit or loss of the society for
that financial year after provision for income tax; and
(iii) the amount (if any) that the directors recommend
should be paid by way of dividend and any such
35 amounts that have been paid or declared since the
commencement of that financial year, indicating
which of those amounts (if any) have been shown in a
previous report under this subsection or subsection
(2); and
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(d) containing a review of the operations of the society during
that financial year and of the results of those operations;
and
(e) giving particulars of any significant change in the state of
5 affairs of the society that happened during that financial
year; and
(f) giving particulars of any matter or circumstance that has
arisen since the end of that financial year and that has
significantly affected or may significantly affect --
10 (i) the operations of the society; or
(ii) the results of those operations; or
(iii) the state of affairs of the society,
in financial years subsequent to that financial year; and
(g) referring to --
15 (i) likely developments in the operations of the society;
and
(ii) the expected results of those operations,
in financial years subsequent to that financial year.
(2) The directors of a society that is a holding society in relation to
20 a financial year must, before (but not more than 3 weeks before) the
day before which the group accounts for that financial year are required
under this Division to be prepared, cause to be prepared a report,
prepared in accordance with a resolution of the directors and signed by
at least 2 directors --
25 (a) stating the names of the directors in office at the date of
the report and specifying for each director --
(i) the qualifications, experience and special
responsibilities (if any) of the director; and
(ii) the number, type and class of any securities or any
30 entitlement to an interest in a benefit fund of the
society for which the society is required to keep
particulars, for the director, under section 317; and
(iii) any interest of the director in a contract or proposed
contract with the society, being an interest declared
35 by the director under Division 2 since the
commencement of this section or the date on which
particulars were last given under this paragraph; and
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(b) stating that --
(i) the society keeps a register under section 317
containing information about the directors, including
details of each director's interests in securities issued
5 by the society or in a benefit fund of the society
(where applicable); and
(ii) the register is open for inspection by any member of
the society, without fee, and by any other person, on
payment of the amount (if any) prescribed by the
10 society's rules; and
(c) stating --
(i) the principal activities of the entities in the group
during its last financial year and any significant
change in the nature of those activities that happened
15 during that period (even if the entities were not part
of the group during all of the financial year); and
(ii) the net amount of the consolidated profit or loss of
the entities in the group for that financial year after
provision for income tax and after deducting from
20 that consolidated profit or loss any amounts that
should properly be attributed to any person other
than an entity in the group; and
(iii) the amount (if any) that the directors of the society
recommend should be paid by way of dividend and
25 any such amounts that have been paid or declared
since the commencement of that financial year,
indicating which of those amounts (if any) have been
shown in a previous report under this subsection or
subsection (1); and
30 (d) containing a review of the operations of the group during
that financial year and of the results of those operations;
and
(e) giving particulars of any significant change in the state of
affairs of the group that happened during that financial
35 year; and
(f) giving particulars of any matter or circumstance that has
arisen since the end of that financial year and that has
significantly affected or may significantly affect --
(i) the operations of the group; or
40 (ii) the results of those operations; or
(iii) the state of affairs of the group,
in financial years subsequent to that financial year; and
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(g) referring to --
(i) likely developments in the operations of the group;
and
(ii) the expected results of those operations,
5 in financial years subsequent to that financial year.
(3) If, in the opinion of the directors of a society, it would prejudice
the interests of the society if any particular information required under
subsection (1) (g) or (2) (g) were to be included in a report --
(a) the information need not be so included; and
10 (b) the report must contain a statement that some, or all (as
the case may require) of the information required under
subsection (1) (g) or (2) (g) has not been included in the
report.
(4) If a society, or an entity controlled by a holding society, has at
15 any time granted to a person an option to have issued to him or her
shares in the society or entity, the directors must state in the report --
(a) in the case of an option granted by a holding society, or an
entity controlled by a holding society, the name of the body
granting the option; and
20 (b) in the case of an option granted during the financial year or
since the end of the financial year --
(i) the name of the person to whom the option was
granted or, where it was granted generally to all the
holders of shares or of a class of shares of that society
25 or entity, that the option was so granted; and
(ii) the number and classes of shares in relation to which
the option was granted; and
(iii) the date of expiration of the option; and
(iv) the basis upon which the option is or was to be
30 exercised; and
(v) whether any person entitled to exercise the option
had or has any right, by virtue of the option, to
participate in any share issue of any other body
corporate; and
35 (c) particulars of shares issued, during the financial year or
since the end of the financial year, by virtue of the exercise
of an option; and
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(d) the number and classes of unissued shares under option as
at the date of the report, the prices, or the method of fixing
the prices, of issue of those shares, the dates of expiration
of the options and particulars of the rights (if any) of the
5 holders of the options to participate by virtue of the options
in any share issue of any other body corporate.
(5) If any of the particulars required by subsection (4) have been
stated in a previous report, they may be stated by reference to that
report.
10 (6) The report must set out whether or not, during the financial
year or since the end of the financial year, a director has received, or
has become entitled to receive, a benefit because of a contract that --
(a) the director; or
(b) a firm of which the director is a member; or
15 (c) an entity in which the director has a substantial financial
interest,
has made (during that or any other financial year) with --
(d) the society; or
(e) an entity that the society controlled, or a body corporate
20 that was related to the society, when the contract was made
or when the director received, or became entitled to receive,
the benefit (if any).
(7) A report referred to in subsection (6) must set out the general
nature of each such benefit that a director has so received or to which a
25 director has so become entitled.
(8) Subsections (6) and (7) do not apply to --
(a) a benefit included in the aggregate amount of emoluments
received or due and receivable, by directors shown in
accordance with the regulations in force for the purposes of
30 section 334 (1) (a); or
(b) the fixed salary of a full-time employee of --
(i) the society; or
(ii) an entity that the society controlled, or a body
corporate that was related to the society, at a
35 relevant time; or
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(c) the provision of financial accommodation to a director
that --
(i) does not contravene section 295; and
(ii) is shown in the society's accounts in accordance with
5 applicable accounting standards.
(9) If there is attached to or included with a report of the directors
laid before a society at its annual general meeting a statement, report
or other document relating to the affairs of the society or any of the
entities controlled by the society, not being a statement, report or
10 document required by this Code to be laid before the society in general
meeting, the statement, report or other document, for the purposes of
section 464, is taken to be part of that first-mentioned report.
(10) To avoid doubt, if a society controlled a particular entity
during part, but not all, of the financial year, the report need not relate
15 to the entity's operations or state of affairs during a period during
which the society did not control the entity or to the result of those
operations.
Directors of holding society must obtain information from
entities controlled by the society
20 337. (1) In this section --
''reporting officers'', in relation to an entity, means --
(a) in the case of a body corporate, the body corporate's
directors; or
(b) in any other case, the entity's officers.
25 (2) Subject to subsection (5), the directors of a holding society
must not cause the group accounts, or the statement under section 335
or the report under section 336 relating to them, to be prepared unless
the directors have available to them sufficient information, in relation
to each entity controlled by the society, to enable them to ensure --
30 (a) that the group accounts will give a true and fair view of --
(i) the profit or loss of the holding society and the
entities it controlled during all or part of the last
financial year; and
(ii) the state of affairs of the holding society and the
35 entities it controlled as at the end of the last financial
year,
so far as they concern members of the holding society; and
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(b) that neither the statement nor the report will be false or
misleading in a material particular.
(3) Without limiting subsection (2), to ensure that the group
accounts meet the requirements of the subsection, the directors must
5 take, in relation to each entity controlled by the society, the reasonable
steps that they are required to take under section 333 in relation to the
society.
(4) The reporting officers of an entity controlled by a holding
society during all or part of, or at the end of, a particular financial year
10 must, at the request of the directors of the holding society, give to the
holding society all the information that is required by the directors of
the holding society for the preparation of the group accounts, the
statement and the report.
(5) If the directors of a holding society, after taking all steps that
15 are reasonably available to them, are unable to obtain from the
reporting officers of the entity controlled by the holding society the
information required for the preparation of the group accounts, the
statement and the report, within the period within which they are
respectively required by this Division to be prepared --
20 (a) the directors of the holding society must cause the group
accounts, statement and report to be prepared without
incorporating or including the information relating to that
entity, but --
(i) they must include in the group accounts, statement or
25 report, as the case requires, a description of the
nature of the information that has not been obtained,
and must include such qualifications and
explanations as are necessary to prevent the group
accounts, statement or report from being misleading;
30 and
(ii) they may qualify accordingly that part of the
statement that is made under section 335 (2) (a); and
(b) if the directors of the holding society have caused the group
accounts, statement and report to be prepared in
35 accordance with paragraph (a), they must, within one
month after receiving any of that information from the
reporting officers of the entity --
(i) lodge with the SSA a statement setting out or
summarizing the information and containing such
40 qualifications and explanations by the directors of the
group accounts, statement or report as are necessary
having regard to the information received from the
reporting officers of the entity; and
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(ii) send a copy of that statement to each member of the
society or, if the rules of the society so provide, make
copies of the statement available to the members of
the society at the registered office and each other
5 office of the society.
Accounts and reports to be laid before annual general meeting
338. (1) The directors of a society must cause to be laid before each
annual general meeting of the society --
(a) a copy of the accounts made out in accordance with
10 section 330 for the last financial year of the society; and
(b) in the case of a society that, at the end of its last financial
year before the relevant annual general meeting, was not a
holding society, a copy of the directors' report made out in
accordance with section 336 in relation to that financial
15 year; and
(c) in the case of a society that, at the end of its last financial
year before the relevant annual general meeting, was a
holding society, a copy of the group accounts made out in
accordance with section 331 in relation to that financial
20 year and a copy of the directors' report made out in
accordance with section 336 in relation to that financial
year; and
(d) a copy of any auditor's report required by section 332 to be
attached to and endorsed upon the accounts or group
25 accounts; and
(e) a copy of the statement by the directors required by
section 335 to be attached to the accounts or group
accounts.
(2) Copies of the accounts, statements and reports required to be
30 laid before an annual general meeting by subsection (1) must be made
available to members of the society at the registered office and at each
other office of the society from the day before which those documents
are required under this Division to have been prepared until the
holding of the annual general meeting.
35 Contravention of Division
339. (1) A director of a society who fails to take all reasonable
steps to comply with or secure compliance with any provision of this
Division commits an offence.
Maximum penalty --
40 (a) if the offence is committed with intent to deceive or defraud
creditors of the society or creditors of any other person or
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for a fraudulent purpose, $100 000 or imprisonment for
15 years, or both; or
(b) in any other case, $25 000.
(2) In any proceeding against a person for an offence against
5 subsection (1) arising out of the accounts or the group accounts of a
society not complying with an applicable accounting standard, the onus
of proving that the accounts would not, if prepared in accordance with
that standard, have given a true and fair view of the matters required
by this Division to be dealt with in those accounts lies on that person.
10 (3) In any proceeding for an offence against subsection (1) arising
out of an omission from the accounts or the group accounts of a society,
it is a defence to prove that the information omitted was immaterial
and did not affect the giving of a true and fair view of the matters
required by this Division to be dealt with in those accounts.
15 (4) If, after the end of the period within which any accounts or any
report of the directors of a society is or are required under this Division
to be prepared, the SSA, by written notice to each of the directors,
requires the directors to produce the accounts or report to a person
specified in the notice on a date and at a place so specified, and the
20 directors fail to produce the accounts or report as required by the
notice, then, in any proceeding for a failure to comply with the
requirements of this Division, proof of the failure to produce the
accounts or report as required by the notice is evidence that the
accounts or report were not prepared within that period.
25 Division 7 -- Audit
Qualifications of auditors
340. (1) In this section --
''officer of a society'' includes a receiver who is not also a
manager.
30 (2) For the purposes of subsections (4) and (5), a person is taken to
be an officer of a society if --
(a) the person is an officer of an entity controlled by the society
or a body corporate related to the society; or
(b) except if the SSA directs that this paragraph not apply in
35 relation to the person, the person has, at any time during
the last 12 months, been an officer or promoter of the
society or of an entity that is controlled by the society.
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(3) For the purposes of this section, a person is not taken to be an
officer of a society by reason only of --
(a) being or having been the liquidator of the society or of an
entity controlled by the society; or
5 (b) having been appointed as auditor of the society or of an
entity controlled by the society or, for any purpose relating
to taxation, a public officer of a body corporate; or
(c) being or having been authorized to accept, on behalf of the
society or an entity controlled by the society, service of
10 process or any notices required to be served on the society
or entity.
(4) Subject to this section, a person must not --
(a) consent to be appointed as auditor of a society; or
(b) act as auditor of a society; or
15 (c) prepare a report required by the friendly societies
legislation to be prepared by a registered company auditor
or by an auditor of a society,
if --
(d) the person is not a registered company auditor; or
20 (e) the person is not ordinarily resident in this State; or
(f) the person is indebted in an amount exceeding $5 000 to
the society or a related body corporate; or
(g) the person --
(i) is an officer of the society; or
25 (ii) is a partner, employer or employee of an officer of the
society; or
(iii) is a partner or employee of an employee of an officer
of the society.
Maximum penalty: $25 000.
30 (5) Subject to this section, a firm must not --
(a) consent to be appointed as auditor of a society; or
(b) act as auditor of a society; or
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(c) prepare a report required by the friendly societies
legislation to be prepared by a registered company auditor
or by an auditor of a society,
unless --
5 (d) at least one member of the firm is a registered company
auditor who is ordinarily resident in this State; or
(e) if the business name under which the firm is carrying on
business is not registered under the law of this State
relating to business names, there has been lodged with the
10 SSA a return in the prescribed form showing, in relation to
each member of the firm, the member's full name and
address as at the time when the firm so consents, acts or
prepares a report; and
(f) neither the firm nor the member of the firm responsible for
15 conducting the audit, or signing the report, is indebted in
an amount exceeding $5 000 to the society or a related body
corporate; and
(g) no member of the firm is --
(i) an officer of the society; or
20 (ii) a partner, employer or employee of an officer of the
society; and
(iii) a partner or employee of an employee of an officer of
the society; and
(h) no officer of the society receives any remuneration from the
25 firm for acting as a consultant to it on accounting or
auditing matters.
(6) The appointment of a firm as auditor of a society is taken to be
an appointment of all persons who are members of the firm and are
registered company auditors, whether resident in Australia or not, as at
30 the date of the appointment.
(7) If a firm that has been appointed as auditor of a society is
reconstituted because of the death, retirement or withdrawal of a
member or members or because of the admission of a new member or
new members, or both --
35 (a) a person who was an auditor of the society by virtue of
subsection (6) and who has so retired or withdrawn from
the firm as previously constituted is taken to have resigned
as auditor of the society as from the day of that retirement
or withdrawal but, unless that person was the only member
40 of the firm who was a registered company auditor and, after
the retirement or withdrawal of that person, there is no
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member of the firm who is a registered company auditor,
section 343 does not apply to that resignation; and
(b) a person who is a registered company auditor and who is so
admitted to the firm is taken to have been appointed as an
5 auditor of the society as from the date of admission to the
firm; and
(c) the reconstitution of the firm does not affect the
appointment of the continuing members of the firm who are
registered company auditors as auditors of the society,
10 but nothing in this subsection affects the operation of subsection (5).
(8) Except as provided by subsection (7), the appointment of the
members of a firm as auditors of a society by virtue of the appointment
of the firm as auditor of the society is not affected by the dissolution of
the firm.
15 (9) A report or notice that purports to be made or given by a firm
appointed as auditor of a society is not taken to be duly made or given
unless it is signed in the firm name and in his or her own name by a
member of the firm who is a registered company auditor.
(10) If, in contravention of this section, a firm consents to be
20 appointed, or acts as, auditor of a society, or prepares a report required
by the friendly societies legislation to be prepared by an auditor of a
society, each member of the firm commits an offence.
Maximum penalty: $25 000.
(11) A person must not --
25 (a) if appointed auditor of a society, knowingly disqualify
himself or herself while the appointment continues from
acting as auditor of the society; or
(b) if a member of a firm that has been appointed auditor of a
society, knowingly disqualify the firm while the
30 appointment continues from acting as auditor of the society.
(12) The SSA, after consultation with AFIC, may exempt a person
or firm from the requirement referred to in subsection (4) (e) or (5) (d).
Appointment of auditors
341. (1) In this section, a reference to the appointment of a person
35 or firm as auditor of a society includes a reference to the appointment
of persons, firms, or a person or persons and a firm or firms, as auditors
of the society.
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(2) Within one month after incorporation, the directors of a society
must appoint, unless the society at a general meeting has appointed, a
person or firm as auditor of the society.
(3) A society, within 14 days after the appointment of an auditor
5 under subsection (2), must give a notice of the appointment in the
prescribed form to the SSA.
(4) A person or firm appointed as auditor under subsection (2)
holds office, subject to this Division, until the first annual general
meeting of the society.
10 (5) A society must --
(a) at its first annual general meeting appoint a person or firm
as auditor of the society; and
(b) at each subsequent annual general meeting, if there is a
vacancy in the office of auditor of the society, appoint a
15 person or firm to fill the vacancy.
Maximum penalty: $25 000.
(6) A person or firm appointed as auditor under subsection (5)
holds office --
(a) until death or removal or resignation from office in
20 accordance with section 343; or
(b) until ceasing to be capable of acting as auditor because of
section 340 (4) or (5).
(7) Within one month after a vacancy, other than a vacancy
caused by the removal of an auditor from office, happens in the office of
25 auditor of the society, if there is no surviving or continuing auditor of
the society, the directors must, unless the society at a general meeting
has appointed a person or firm to fill the vacancy, appoint a person or
firm to fill the vacancy.
(8) While a vacancy in the office of auditor continues, the
30 surviving or continuing auditor (if any) may act.
(9) A society, or the directors of a society, must not appoint a
person or firm as auditor of the society unless the person or firm has,
before the appointment, consented by written notice given to the society
or to the directors to act as auditor and has not withdrawn consent by
35 written notice given to the society or to the directors.
Maximum penalty: $5 000.
(10) A notice given by a firm must be signed in the firm name and
in the name of a member of the firm who is a registered company
auditor.
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(11) A purported appointment of a person or firm as auditor of a
society in contravention of subsection (9) has no effect.
(12) If an auditor of a society is removed from office at a general
meeting in accordance with section 343 --
5 (a) the society may at that meeting (without adjournment), by
a resolution passed by a majority of its members as, being
entitled so to do, vote in person, immediately appoint as
auditor a person or firm to whom has been sent a copy of
the notice of nomination in accordance with section 342; or
10 (b) if a resolution is not passed, or could not be passed only
because a copy of the notice of nomination had not been
sent to a person, the meeting may be adjourned to a date
not earlier than 20 days and not later than 30 days after
the day of the meeting and the society may, at the
15 adjourned meeting, by ordinary resolution, appoint as
auditor a person or firm notice of whose nomination for
appointment as auditor has been received by the society
from a member of the society at least 14 clear days before
the date of the adjourned meeting.
20 (13) If after the removal from office of an auditor, the society fails
to appoint another auditor under subsection (12) --
(a) the society must, within 7 days after the failure, notify the
SSA of the failure; and
(b) the SSA must, unless there is another auditor of the society
25 whom the SSA believes is able to carry out the
responsibilities of auditor alone and who agrees to continue
as auditor, appoint as auditor a person who or firm that
has consented to be appointed.
Maximum penalty: $25 000.
30 (14) Subject to subsection (13), if a society does not appoint an
auditor when required by this Division to do so, the SSA may, on the
written application of a member of the society, appoint as auditor of the
society a person who or firm that has consented to be appointed.
(15) A person or firm appointed as auditor of a society under
35 subsection (7), (12), (13) or (14) holds office, subject to this Division,
until the next annual general meeting of the society.
(16) A director of a society must take all reasonable steps to
comply with, or to secure compliance with, subsection (2) or (7).
Maximum penalty applying to subsection (16): $25 000.
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Nomination of auditors
342. (1) Subject to this section, a society must not appoint a person
or firm as auditor of the society at its annual general meeting, not
being a meeting at which an auditor is removed from office, unless
5 written notice of nomination of the person or firm as auditor was given
to the society by a member --
(a) before the meeting was convened; or
(b) not less than 21 days before the meeting.
(2) A purported appointment of a person or firm as auditor of the
10 society in contravention of subsection (1) has no effect.
(3) If a society contravenes subsection (1), the society and any
officer of the society who is in default each commits an offence.
Maximum penalty: $25 000.
(4) If notice of nomination of a person or firm for appointment as
15 auditor is received by the society, whether for appointment at a meeting
or an adjourned meeting mentioned in section 341 (12) or at an annual
general meeting, the society must not less than 7 days before the
meeting or at the time notice of the meeting is given --
(a) send a copy of the notice of nomination to each person or
20 firm nominated and to each auditor of the society; and
(b) cause a copy of the notice of nomination to be displayed in a
conspicuous place at the registered office and each other
office of the society until the day of the meeting.
Maximum penalty applying to subsection (4): $5 000.
25 Removal and resignation of auditors
343. (1) Except as provided in section 44 (4) (f), an auditor of a
society may only be removed from office by special resolution at a
general meeting of the society.
(2) If notice of a special resolution to remove an auditor is given,
30 the society must as soon as practicable send a copy of the notice to the
auditor and to the SSA.
Maximum penalty: $50 000.
(3) Within 7 days after receiving a copy of the notice, the auditor
may make written representations of not more than a reasonable length
35 to the society and request that a copy of the representations be
displayed by the society in a conspicuous place at the registered office
and each other office of the society until the day of the meeting at
which the resolution is to be considered.
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(4) Unless the SSA on the application of the society orders
otherwise, the society must display a copy of the representations in
accordance with the auditor's request, and the auditor may, without
prejudice to the right to be heard orally or, if a firm is the auditor, to
5 have a member of the firm heard orally on its behalf, require that the
representations be read out at the meeting.
Maximum penalty: $50 000.
(5) If an auditor is removed from office, the society must
immediately give to the SSA written notice of the removal.
10 Maximum penalty: $50 000.
(6) An auditor of a society may, by written notice given to the
society, resign as auditor of the society if the auditor --
(a) by written notice given to the SSA, has applied for consent
to the resignation and stated the reasons for the
15 application; and
(b) at or about the same time as the auditor gave the notice to
the SSA, has given written notice of the application to the
society; and
(c) has received the consent of the SSA to the resignation.
20 (7) The SSA must, as soon as practicable after receiving a notice
from an auditor, notify the auditor and the society whether it consents
to the resignation.
(8) A statement made by an auditor in an application to the SSA
for consent to the resignation or in answer to an inquiry by the SSA
25 relating to the reasons for the application --
(a) is not admissible in evidence in any civil or criminal
proceeding against the auditor; and
(b) may not be made the ground of a prosecution, action or suit
against the auditor.
30 (9) A certificate by the SSA that a statement was made in the
application or in the answer to an inquiry by the SSA is conclusive
evidence that the statement was so made.
(10) Subject to subsection (11), the resignation of an auditor takes
effect --
35 (a) on the date (if any) specified for the purpose in the notice of
resignation; or
(b) on the date on which the SSA gives its consent to the
resignation; or
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(c) on the date (if any) fixed by the SSA for the purpose,
whichever is the later.
(11) If, on the retirement or withdrawal from a firm of a member,
the firm will no longer be capable, because of section 340 (5) (d), of
5 acting as auditor of a society, the member so retiring or withdrawing
must (if not disqualified from acting as auditor of the society) give
reasonable notice to the society of his or her retirement or withdrawal
and, upon receipt of the notice by the society, the office of auditor
becomes vacant.
10 Maximum penalty: $50 000 or imprisonment for 7 years, or both.
(12) Within 14 days after the receipt of a notice of resignation,
retirement or withdrawal from an auditor, the society must --
(a) give a notice of the resignation, retirement or withdrawal in
the prescribed form to the SSA; and
15 (b) if there is a trustee for the holders of securities issued by
the society, give to the trustee a copy of the notice given to
the SSA.
Maximum penalty: $50 000.
Effect of winding up on office of auditor
20 344. An auditor of a society ceases to hold office if --
(a) a special resolution is passed for the voluntary winding up
of the society; or
(b) an order is made by the Court for the winding up of the
society; or
25 (c) the SSA issues a certificate under section 402 in relation to
the society.
Fees and expenses of auditors
345. A society must pay the reasonable fees and expenses of an
auditor, including the auditor's expenses in giving a report required to
30 be given by this Code.
Auditor's report
346. (1) An auditor of a society must report to the members on the
accounts required to be laid before the society at the annual general
meeting and on the society's accounting records and other records
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relating to those accounts and, if the society is a holding society for
which group accounts are required, must also report to the members on
the group accounts.
(2) The auditor must state in the report --
5 (a) whether the accounts and any group accounts are in the
auditor's opinion properly prepared --
(i) so as to give a true and fair view of the matters
required by sections 330 and 331 to be dealt with in
the accounts or group accounts; and
10 (ii) in accordance with the friendly societies legislation;
and
(iii) in accordance with applicable accounting standards;
and
(b) if, in the auditor's opinion, the accounts or group accounts
15 have not been prepared in accordance with a particular
applicable accounting standard --
(i) whether, in the auditor's opinion, the accounts or
group accounts, as the case may be, would, if
prepared in accordance with that standard, have
20 given a true and fair view of the matters required by
sections 330 and 331 to be dealt with in those
accounts; and
(ii) if, in the auditor's opinion, the accounts or group
accounts would not, if so prepared, have given a true
25 and fair view of those matters, the reasons for that
opinion; and
(iii) if the directors have caused a statement to be
attached to the accounts or group accounts giving
particulars of the quantified financial effect on those
30 accounts of the failure to so prepare the accounts, the
auditor's opinion of those particulars; and
(iv) in a case to which neither sub-paragraph (ii) nor (iii)
applies, particulars of the quantified financial effect
on the accounts or group accounts of the failure to so
35 prepare those accounts; and
(c) in the case of group accounts --
(i) the names of each entity that the society controlled
during all or part of, or at the end of, the financial
year but for which the auditor has not acted as
40 auditor; and
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(ii) if there are included in the group accounts (whether
separately or consolidated with other accounts) the
accounts of an entity controlled by the society of
which he or she has not acted as auditor, and he or
5 she has not examined the auditor's report (if any) on
those accounts, the name of that entity; and
(iii) if the auditor's report on the accounts of an entity
controlled by the society was made subject to any
qualification, or included any comment made under
10 subsection (4), the name of that entity and particulars
of the qualification or comment; and
(d) any defect or irregularity in the accounts or group accounts
and any matter not set out in the accounts or group
accounts without regard to which a true and fair view of
15 the matters dealt with by the accounts or group accounts
would not be obtained; and
(e) if the auditor is not satisfied as to any matter mentioned in
paragraph (a) or (b), the reasons for not being so satisfied.
(3) The auditor of a society has a duty to form an opinion on each
20 of the following matters --
(a) whether the auditor has obtained all the information and
explanations that he or she required;
(b) whether proper accounting records and other records,
including registers, have been kept by the society as
25 required by the friendly societies legislation;
(c) whether the returns received from offices of the society
other than the registered office are adequate;
(d) if the society is a holding society --
(i) whether the accounts of the entities controlled by the
30 society that are to be consolidated with other
accounts are, in form and content, appropriate and
proper for the purposes of the preparation of the
consolidated accounts, and whether the auditor has
received satisfactory information and explanations as
35 required by him or her for that purpose; and
(ii) whether the procedures and methods used by the
society and by each of the entities it controls in
arriving at the amounts taken into any consolidated
accounts were appropriate to the circumstances of the
40 consolidation.
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(4) The auditor must state in the auditor's report particulars of
any deficiency, failure or shortcoming in relation to any matter
mentioned in subsection (3).
(5) The auditor must give the auditor's report to the directors of
5 the society in sufficient time to enable the society to comply with the
requirements of section 332 in relation to that report.
(6) The auditor's report --
(a) must be attached to or endorsed on the accounts or group
accounts; and
10 (b) if a member so requires, must be read before the society at
the annual general meeting; and
(c) must be open to inspection by a member at any reasonable
time.
(7) The auditor must, when giving the auditor's report, also give to
15 the directors of the society a report as to --
(a) the adequacy, in the auditor's opinion, of the systems
adopted by the society to monitor and manage risks
associated with its financial activities; and
(b) any other matter of a kind prescribed in a standard made
20 for the purpose of this subsection.
(8) An auditor must, at the time at which the auditor gives the
directors of a society a report under subsection (7), give a copy of the
report to the SSA.
(9) An auditor of a society who contravenes this section commits
25 an offence.
Maximum penalty: $5 000.
Powers and duties of auditor
347. (1) An auditor of a society has a right of access at all
reasonable times to the accounting records and other records and
30 registers of the society.
(2) The auditor is entitled to require from any officer of the society
any information and explanation that the auditor requires for the audit.
(3) An auditor of a holding society for which group accounts are
required has a right of access at all reasonable times to the accounting
35 records and other records and registers of each entity that the society
controlled during all or part of, or at the end of, any relevant financial
year even if the holding society no longer controls the entity.
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(4) The auditor is entitled to require from any officer or auditor of
any entity controlled by the holding society, at the expense of the
holding society, any information and explanation in relation to the
affairs of the entity that the auditor requires for the purpose of
5 reporting on the group accounts.
(5) An auditor of a society, or an agent authorized by the auditor
in writing for the purpose --
(a) is entitled to attend any general meeting of the society or, if
held separately, any meeting of the members of any benefit
10 fund; and
(b) is entitled to receive all notices of, and other
communications relating to, any general meeting of the
society or, if held separately, any meeting of the members
of any benefit fund that a member is entitled to receive;
15 and
(c) is entitled to be heard at any general meeting of the society
or, if held separately, any meeting of the members of any
benefit fund, that he or she attends on any part of the
business of the meeting that concerns the auditor in the
20 capacity of auditor; and
(d) is entitled so to be heard even though --
(i) the auditor retires at that meeting; or
(ii) a resolution to remove the auditor from office is
passed at that meeting.
25 (6) If an auditor becomes aware that the society or the directors
has or have not complied with section 301, or the provisions of
section 338 relating to the laying of accounts or group accounts before
the annual general meeting of the society, the auditor must
immediately inform the SSA by written notice and, if accounts or group
30 accounts have been prepared and audited, send to the SSA a copy of the
accounts or group accounts and of the auditor's report on the accounts
or group accounts.
(7) Except in a case to which subsection (6) applies, if an auditor,
while performing duties as auditor of a society, is satisfied that --
35 (a) there has been a contravention of the friendly societies
legislation; and
(b) the circumstances are such that, in the auditor's opinion,
the matter has not been, or will not be, adequately dealt
with by comment in his or her report on the accounts or
40 group accounts or by bringing the matter to the notice of
the directors of the society,
the auditor must immediately report the matter to the SSA by written
notice.
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(8) If an auditor of a society or holding society --
(a) is not satisfied that the accounts or group accounts comply
with a particular applicable accounting standard; or
(b) is of the opinion that the accounts or group accounts do not
5 comply with a particular applicable accounting standard,
the auditor must report the matter to the SSA in writing within 7 days
after giving to the directors of the society or holding society his or her
report under section 346.
(9) If an auditor sends to the SSA a report on the accounts or
10 group accounts under subsection (8), the SSA may, by written notice to
the society or holding society, require it to give a copy of the accounts or
group accounts to the SSA within 7 days after service of the notice.
(10) In addition to any other report that an auditor, or former
auditor, of a society is required to give to the SSA, an auditor, or former
15 auditor, of a society must give to the SSA any report in relation to the
affairs of the society that the SSA requires and the auditor, or former
auditor, is able to give.
(11) An auditor, or former auditor, of a society who contravenes
this section commits an offence.
20 Maximum penalty: $5 000.
Final audit on merger, etc.
348. (1) If --
(a) a society is dissolved as part of a merger or transfer of
engagements, under Part 7; or
25 (b) a society converts to a company or an incorporated
association,
the auditor of the society must prepare a report containing prescribed
statements and information relating to the accounts and the accounting
records of the society for the financial year up to the date of dissolution
30 of the society or the date approved by the SSA for the conversion, as the
case may be, and for the preceding financial year if an auditor's report
has not been prepared relating to the accounts for that year.
(2) The provisions of section 347 relating to the rights of access of
an auditor to the records of a society and any entity controlled by a
35 society apply in relation to a report under this section as if it were a
report required under section 346.
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(3) If a society is dissolved as part of a merger, or transfer of
engagements, a report under this section in relation to the accounts
must be given by the auditor to the directors of the merged society, or
transferee society, as the case may be, within 2 months after the date of
5 the merger or transfer and the directors of the merged society or
transferee society must in turn, within 3 months after the date of the
merger or transfer, send each auditor's report together with the
accounts of each society dissolved as part of the merger or transfer to
the SSA.
10 (4) If a society is converted to a company or an incorporated
association, a report under this section in relation to the accounts must
be given by the auditor --
(a) if the society is converted to a company, to the directors of
the company; or
15 (b) if the society is converted to an incorporated association, to
the managing body of the association,
within 2 months after the date approved by the SSA for the conversion
and the directors of the company or the managing body of the
association must in turn, within 3 months after the date approved for
20 the conversion, send the auditor's report together with the accounts of
the society to the SSA.
(5) An auditor of a society who contravenes this section commits
an offence.
Maximum penalty: $5 000.
25 (6) A director of a society or company, or a member of the
managing body of an incorporated association, must take all reasonable
steps to ensure that a report required by this section to be sent to the
SSA by the directors of a society or company, or the managing body of
the association, is so sent.
30 Maximum penalty applying to subsection (6): $5 000.
Auditors and entities controlled by societies
349. (1) Despite the fact that an entity controlled by the society
may be exempt from appointing an auditor under the Corporations
Law, a society must ensure that the accounts and accounting records of
35 an entity controlled by the society are audited in accordance with this
Part.
Maximum penalty: $75 000.
(2) If an entity controlled by a society has not appointed an
auditor to audit its accounts and accounting records under this Part,
40 the auditor of the holding society is also auditor of the entity.
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Obstruction of auditor
350. (1) An officer of a society must not --
(a) fail without lawful excuse --
(i) to allow an auditor of the society access, in
5 accordance with this Part, to any accounting records
and other records and registers of the society that are
in the custody or control of the officer; or
(ii) to give any information or explanation as and when
required under this Part; or
10 (b) otherwise hinder, obstruct or delay an auditor in the
performance of the duties or the exercise of the powers of
an auditor.
(2) An officer or auditor of an entity controlled by a society must
not --
15 (a) refuse or fail without lawful excuse --
(i) to allow an auditor of the society that controls the
entity, or has controlled but no longer controls it,
access, in accordance with this Part, to any
accounting records and other records and registers of
20 the entity in the custody or control of that officer or
auditor; or
(ii) to give any information or explanation as and when
required under this Part; or
(b) otherwise hinder, obstruct or delay an auditor in the
25 performance of the duties or the exercise of the powers of
an auditor.
Maximum penalty: $75 000 or imprisonment for 10 years, or both.
Qualified privilege
351. (1) An auditor of a society has qualified privilege in relation
30 to --
(a) any oral or written statement made by the auditor while
exercising functions as auditor of the society; and
(b) the giving to the SSA of a notice or report, or a copy of any
accounts or group accounts.
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(2) A person has qualified privilege in relation to the publishing
of --
(a) a document that is prepared by an auditor of a society
while exercising functions as auditor of the society and is
5 required under the friendly societies legislation to be lodged
with the SSA or AFIC, whether or not the requirement has
been complied with; and
(b) any oral or written statement made by the auditor while
exercising functions as auditor of the society.
10 (3) This section does not limit or affect any other right, privilege
or immunity that an auditor or other person has as a defendant in an
action for defamation.
Division 8 -- Actuaries
Appointment of actuaries
15 352. (1) Subject to subsection (2), a society must have an actuary
appointed by the society.
(2) Within 6 weeks after a person ceases to be the actuary of a
society, the society must appoint another person to be the actuary of the
society.
20 (3) A person may only hold an appointment as actuary of a society
if the person is eligible for such an appointment.
(4) Subject to section 353 (2), a person is eligible for appointment
as a society's actuary if the person --
(aa) is ordinarily resident in this State; and
25 (a) is a Fellow of the Institute of Actuaries of Australia; and
(b) has been such a Fellow for at least 5 years; and
(c) is not indebted to the society by more than $5 000; or
(d) is not subject to a declaration in force under section 353 (3).
(5) An appointment of a person as actuary of a society cannot take
30 effect while there is in force an appointment of another person as the
society's actuary.
(6) The SSA, after consultation with AFIC, may exempt a person
from the requirement referred to in subsection (4) (aa).
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Cessation of appointment
353. (1) A person ceases to hold an appointment as the actuary of a
society if --
(a) the person ceases to be eligible for such an appointment; or
5 (b) the person gives the society a written notice of resignation
of the appointment; or
(c) the society gives the person written notice that the
appointment is terminated.
(2) A person who, apart from this subsection, would be eligible for
10 appointment as a society's actuary is not so eligible if there is in force a
declaration by the SSA under subsection (3).
(3) The SSA may, in writing, declare that a person is not eligible
for appointment as a society's actuary if the person has failed to
perform adequately and properly the functions and duties of an actuary
15 under this Code.
(4) A declaration takes effect 28 days after the date of the
declaration or, if an earlier date is specified in the declaration, on that
earlier date.
(5) The SSA must give a copy of a declaration to the person to
20 whom it relates.
Notification of appointment etc.
354. (1) A society that appoints a person under section 352 must
give the SSA written notice of --
(a) the name of the person; and
25 (b) details of the actuarial qualifications and experience of the
person; and
(c) the date of the appointment; and
(d) any other matter prescribed by the standards.
(2) Notice under subsection (1) must be given within 14 days after
30 the day of the appointment.
(3) If a person ceases to be the actuary of a society, the society
must give the SSA written notice that the person has so ceased and of
the date on which he or she so ceased.
(4) Notice under subsection (3) must be given within 14 days after
35 the day on which the person ceased to be the actuary of the society.
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Powers of actuary
355. (1) The actuary of a society is entitled to have access to any
information or document in the possession, or under the control, of the
society if such access is reasonably necessary for the proper
5 performance of the functions and duties of the actuary.
(2) The actuary of a society may require any officer of the society
to answer questions or produce documents for the purpose of enabling
the actuary to have the access to information and documents provided
for by subsection (1).
10 (3) An officer of a society must not refuse or fail, without
reasonable excuse, to comply with a requirement under subsection (2).
(4) The actuary of a society is entitled to attend a meeting of the
directors of the society and to speak on any matter being considered at
the meeting --
15 (a) that relates to, or may affect --
(i) the solvency of the society or any of its benefit funds;
or
(ii) the adequacy of the capital of the society; or
(b) that relates to advice given by the actuary to the directors;
20 or
(c) that concerns a matter in relation to which the actuary will
be required to give advice.
(5) The actuary of a society --
(a) is entitled to attend any general meeting of the society or, if
25 held separately, any meeting of the members of any benefit
fund or any other meeting of members at which accounts
are to be considered or at which any matter in connection
with which the actuary is or has been subject to a duty
under this Code is to be considered; and
30 (b) is entitled to receive all notices of, and other
communications relating to, any general meeting of the
society or, if held separately, any meeting of the members
of any benefit fund or any other meeting of members that a
member is entitled to receive; and
35 (c) is entitled to be heard at any general meeting of the society
or, if held separately, any meeting of the members of any
benefit fund or any other meeting of members that he or
she attends on any part of the business of the meeting that
concerns the actuary in the capacity of actuary; and
40 (d) is entitled so to be heard even though the actuary retires at
that meeting.
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Actuary's obligation to report to SSA
356. (1) The actuary of a society must draw to the attention of the
society any matter that comes to the attention of the actuary and that
the actuary thinks requires action to be taken by the society or its
5 directors --
(a) to avoid a contravention of the friendly societies legislation;
or
(b) to avoid prejudice to the interests of the members of the
society.
10 (2) If the actuary of a society thinks --
(a) that there are reasonable grounds for believing that the
society or a director of the society may have contravened
the friendly societies legislation or any other law; and
(b) that the contravention is of such a nature that it may affect
15 significantly the interests of the members of the society,
the actuary must inform the SSA in writing of --
(c) his or her opinion; and
(d) the information on which it is based.
(3) If --
20 (a) the actuary of a society has drawn to the attention of the
society a matter that the actuary thinks requires action to
be taken by the society or its directors --
(i) to avoid a contravention of the friendly societies
legislation; or
25 (ii) to avoid prejudice to the interests of the members of
the society; and
(b) the actuary is satisfied that there has been a reasonable
time for the taking of the action but the action has not been
taken --
30 the actuary must inform the SSA in writing of the matter referred to in
paragraph (a).
(4) If the actuary of a society considers on reasonable grounds
that --
(a) the directors of the society have failed to take such action
35 as is reasonably necessary to enable the actuary to exercise
his or her right under section 355 (4) or (5); or
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(b) an officer of the society has engaged in conduct calculated
to prevent the actuary exercising his or her right under
section 355 (4) or (5),
the actuary must inform the SSA of --
5 (c) his or her opinion; and
(d) the information on which it is based.
(5) If --
(a) the actuary of a society becomes subject to an obligation
under subsection (2) or (3) to inform the SSA of anything;
10 and
(b) before the actuary informs the SSA, he or she ceases to be
the actuary of the society concerned,
the actuary remains subject to the obligation as if he or she were still
the actuary of the society.
15 Qualified privilege of actuary
357. (1) A person who is, or has been, the actuary of a society has
qualified privilege in respect of any statement, whether written or oral,
made by him or her for the purpose of the performance of his or her
functions as actuary of the society.
20 (2) In particular (and without limiting subsection (1)), a person
who is or has been the actuary of a society has qualified privilege in
respect of any statement, written or oral, made by him or her under, or
for the purposes of, a provision of this Code.
(3) The privilege conferred by this section is in addition to any
25 privilege conferred on a person by any other law.
Actuarial investigations
358. (1) A society must arrange for its actuary to --
(a) conduct a financial investigation in accordance with the
standards either --
30 (i) as at the end of each financial year of the society; or
(ii) as otherwise determined by the SSA, in accordance
with applicable standards, and notified in writing by
the SSA to the society; and
(b) give the society a written report of the results of the
35 investigation.
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(2) See note to section 1.
(3) The society must, immediately after receipt of the report
referred to in subsection (1) (b), send a copy of the report to the SSA.
Additional actuarial investigations
5 359. (1) Nothing in this Division prevents a society from having its
actuary investigate the financial condition of the society as at a time
other than a time specified in section 358 (1) (a).
(2) A society must not make public the results of an investigation
referred to in subsection (1) unless --
10 (a) the investigation has been conducted in accordance with
applicable standards; and
(b) the actuary has given the society a written report of the
results of the investigation.
(3) If the SSA, by written notice given to a society, requires that
15 an investigation referred to in subsection (1) be conducted by the
society --
(a) the investigation must be conducted in accordance with
applicable standards; and
(b) the society must arrange for its actuary to give the society
20 and the SSA a written report of the results of the
investigation.
Division 9 -- Returns and Relief
Returns
360. (1) A society must lodge returns with the SSA in accordance
25 with the regulations.
Maximum penalty: $5 000.
(2) The SSA may, by written notice, require a society to lodge such
further returns that the SSA requires.
(3) A further return must contain the information required by the
30 notice and must be lodged as often as is required by the notice.
(4) Without limiting the effect of this section, the information that
may be required in a further return may comprise or include
information relating to --
(a) an entity controlled by the society; and
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(b) a body corporate or other entity formed or acquired outside
Australia by an entity controlled by the society; and
(c) a body corporate or other entity (whether within or outside
Australia) with which --
5 (i) the society; or
(ii) an entity controlled by the society; or
(iii) a body corporate or other entity mentioned in
paragraph (b),
has invested funds.
10 (5) The SSA may, by written notice, require a society to lodge with
a return or further return a report by a registered company auditor, or
other person of a specified class, on specified matters to which the
return relates.
(6) A society that fails to comply with a requirement of a notice
15 given to it under this section commits an offence.
Maximum penalty applying to subsection (6): $100 000.
Relief from requirements as to accounts, audit and actuaries
361. (1) The directors of a society may apply to the SSA in writing
for an order relieving the directors, the society or the auditor or actuary
20 of the society from compliance with any specified requirements of
Division 6 (other than section 328), 7 or 8.
(2) An application under subsection (1) must be accompanied by a
written statement made in accordance with a resolution of the directors
of the society, signed by not less than 2 directors and stating the
25 reasons for seeking the order.
(3) The SSA may require the directors making the application to
supply such information relating to the operations of the society, and of
any entity controlled by the society, as the SSA thinks necessary for the
purpose of determining the application.
30 (4) The SSA may make an order unconditionally or subject to any
conditions it considers appropriate.
(5) Notice of an order under subsection (4) must be given to the
society.
(6) The SSA may, if it considers it appropriate, make an order in
35 relation to a specified class of societies relieving the directors of a
society included in that class, a society included in that class, the
auditor of a society included in that class or the actuary of a society
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included in that class, from compliance with any specified requirements
of Division 6 (other than section 328), 7 or 8.
(7) The SSA may make an order under subsection (6)
unconditionally or subject to any conditions it considers appropriate.
5 (8) Notice of an order under subsection (6) must be published in
the Gazette.
(9) The SSA must not make an order in relation to a society, or a
class of societies, under this section unless the SSA is of the opinion, in
relation to each requirement of this Code specified in the order, that
10 compliance with the requirement --
(a) would render accounts or group accounts, or a report
required in relation to those accounts, misleading; or
(b) would be inappropriate to the circumstances of the society,
or of the societies included in that class; or
15 (c) would impose unreasonable burdens on --
(d) the society, an officer of the society or the auditor or
actuary of the society; or
(i) the societies, or officers or auditors or actuaries of the
societies, included in that class,
20 as the case may be.
(10) An order under this section may be limited in its effect to a
period specified in the order.
(11) The SSA may, on application by the directors of a society or
on its own initiative, revoke or suspend an order under this section.
25 (12) A revocation or suspension does not take effect --
(a) in the case of an order under subsection (4), until written
notice of the revocation or suspension is given to the
society; or
(b) in the case of an order under subsection (6), until notice of
30 the revocation or suspension is published in the Gazette.
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PART 7 -- MERGERS OF SOCIETIES AND TRANSFERS OF
ENGAGEMENTS
Division 1 -- Preliminary
Definitions
5 362. In this Part --
''certificate of confirmation'' means a certificate given by the
SSA to confirm a transfer of engagements;
''transferee society'' means a society to whom another society is
to transfer, or has transferred, its engagements under this
10 Part;
''transferor society'' means a society that is to transfer, or has
transferred, its engagements under this Part.
Application of Part
363. Nothing in this Part authorizes the restructure or termination of
15 a benefit fund otherwise than in accordance with Part 4A.
Division 2 -- Mergers and Transfers of Engagements
between Societies
Application for registration of merger or transfer
364. (1) If 2 or more societies propose to consolidate all or any of
20 their assets, liabilities and undertakings by way of merger, or transfer
of engagements, the societies may, after complying with this section,
apply for the registration of the merger, or transfer of engagements.
(2) The proposed merger, or transfer of engagements, must have
been approved by a special resolution of each society involved unless
25 the SSA has determined that it may be approved by the society's board.
(3) A society that is to approve the proposed merger, or transfer of
engagements, by special resolution must send to each of its members a
statement approved by the SSA specifying --
(a) the financial position of each of the societies as shown in
30 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 proposal in relation to the appointment of directors of a
merged society; and
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(c) any interest that any officer of any of the societies has in
the proposed merger, or transfer of engagements; and
(d) any compensation or other consideration proposed to be
paid, or any other incentive proposed to be given, to any
5 officer or member of a society in relation to the proposed
merger, or transfer of engagements; and
(e) whether the proposal is a merger, or transfer of
engagements and the reason for the merger, or transfer of
engagements; and
10 (f) in the case of a transfer of engagements, whether it is a
total or partial transfer of engagements; and
(g) any other matter specified by the SSA.
(4) The statement mentioned in subsection (3) must be sent to the
members of the society so that it will, in the ordinary course of post,
15 reach each member who is entitled to vote on the special resolution not
later than --
(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
20 days before the day on or before which the ballot papers
must be returned in accordance with the regulations by
members voting in the ballot.
(5) The SSA may exempt a society from having to comply with
subsection (3).
25 (6) The SSA may grant an exemption, or approve a statement,
subject to any conditions it considers appropriate.
(7) An application for the registration of a merger or transfer of
engagements under this Division must be made in the way and form
required by the SSA.
30 (8) An application for a proposed merger must be accompanied by
2 copies of the proposed rules of the merged society and any other
particulars required by the SSA.
SSA may register merged society
365. (1) If, in relation to an application under this Division by
35 societies for registration of a proposed merger, the SSA is satisfied
that --
(a) the societies involved have complied with section 364; and
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(b) the proposed rules of the merged society are adequate; and
(c) there are reasonable grounds for believing that the merged
society will be able to comply with all applicable standards;
and
5 (d) the certificates of incorporation of the societies involved in
the merger have been surrendered to the SSA; and
(e) there is no good reason why the merged society and its
rules should not be registered,
the SSA must --
10 (f) register the merged society; and
(g) register its rules; and
(h) cancel the registration of the societies involved in the
merger.
(2) On registering the merged society, the SSA must issue to the
15 society a certificate of incorporation.
(3) A merger takes effect on the issue of the certificate of
incorporation under subsection (2).
Certificate of confirmation (voluntary transfer)
366. (1) This section applies to a transfer of engagements following
20 an application under section 364.
(2) For a total transfer of engagements, the SSA must issue a
certificate of confirmation if it is satisfied that --
(a) the societies have complied with section 364; and
(b) the rules, or proposed rules, of the transferee society are
25 adequate; and
(c) the certificate of incorporation of the transferor society has
been --
(i) surrendered to the SSA; or
(ii) lost or destroyed; and
30 (d) there is no good reason why the transfer should not take
effect.
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(3) For a partial transfer of engagements, the SSA must issue a
certificate of confirmation if it is satisfied that --
(a) the societies have complied with section 364; and
(b) the rules, or proposed rules, of the societies are adequate;
5 and
(c) there is no good reason why the transfer should not take
effect.
SSA may direct a transfer of engagements between societies
367. (1) The SSA may, by written notice given to a society, direct it
10 to totally or partially transfer its engagements to another society (the
''transferee society'') if the board of the transferee society has, by
resolution, consented to the proposed transfer.
(2) The SSA must give a copy of the direction to the transferee
society.
15 (3) For a total transfer of engagements, the direction must specify
that the transferor society must surrender its certificate of
incorporation to the SSA or satisfy the SSA that its certificate has been
lost or destroyed.
(4) The SSA must not direct a society to transfer its engagements
20 under this section unless --
(a) the SSA is of the opinion that --
(i) the society has contravened the friendly societies
legislation or the society's rules and, after being given
written notice of the contravention by the SSA, has
25 allowed the contravention to continue or has again
contravened the legislation or rules; or
(ii) the management fund of the society has an
accumulated deficit; or
(iii) the affairs of the society or a fund of the society are
30 being managed or conducted in an improper or
financially unsound way; or
(b) after making such inquiries in relation to one or both of the
societies as the SSA considers appropriate, the SSA is
satisfied that it is in the interest of members or creditors of
35 the society that is to be directed to transfer its
engagements; or
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(c) the SSA has certified, in relation to the society, that any of
the events mentioned in section 402 (1) (a), (b), (c) or (g)
has happened.
SSA may modify rules to facilitate transfer of engagements
5 368. (1) If the SSA has directed a transfer of engagements under
section 367, the SSA may, by notation on the registered copy of the
rules of the transferor society (if it is to continue to exist) or the
transferee society or both, amend the rules of the society to the extent
necessary to ensure that the rules are appropriate.
10 (2) The SSA must amend the rules by notation on the registered
copy.
(3) The SSA must immediately give written notice to the society
of --
(a) an amendment of the society's rules made under this
15 section; and
(b) the day on which the amendment takes effect.
(4) A society must give to its members, not later than the day on
which notice is given of the next general meeting of the society, a
written notice containing the text or a summary of an amendment of
20 the society's rules under this section.
(5) The notice may, with the prior written approval of the SSA, be
given by advertisement published in a newspaper circulating
generally --
(a) in the area of the State in which the society operates; and
25 (b) if the society operates in another State, or other States, in
the other State or States.
Society to comply with direction
369. (1) A society must take all reasonable steps to comply with a
direction under this Division to transfer its engagements.
30 Maximum penalty: $100 000.
(2) An officer of a society must not --
(a) fail to take all reasonable steps to secure compliance by the
society with a direction to transfer its engagements; or
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(b) by a wilful act or omission, be the cause of a failure by the
society to comply with a direction to transfer its
engagements.
Maximum penalty: $100 000 or imprisonment for 15 years, or
5 both.
Certificate of confirmation (transfer by direction)
370. (1) This section applies to a transfer of engagements by a
direction under section 367.
(2) If the transfer takes effect immediately, the direction must be
10 accompanied by a certificate of confirmation.
(3) If the transfer does not take effect immediately --
(a) the direction must specify the day when the SSA proposes
to issue the certificate of confirmation; and
(b) when the SSA is satisfied that the societies have complied
15 with the direction, it must issue a certificate of
confirmation.
Who receives the certificate of confirmation
371. The SSA must give a certificate of confirmation --
(a) for a partial transfer, to each of the societies; or
20 (b) for a total transfer, to the transferee society.
When transfer of engagements takes effect
372. A transfer of engagements takes effect on the date of issue of the
certificate of confirmation of the transfer or such later date as specified
in the certificate.
25 Cancellation of registration after total transfer
373. When a total transfer of engagements takes effect, the SSA must
cancel the transferor society's registration.
Effect of merger
374. (1) This section applies on a merger of societies under this
30 Division taking effect.
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(2) The merged society is the successor of the merging societies.
(3) Without limiting subsection (2) --
(a) the members of each merging society become members of
the merged society; and
5 (b) all assets and liabilities of each merging society become
assets and liabilities of the merged society without any
conveyance, transfer or assignment; and
(c) in all documents (including, for example, a contract to
which a merging society was a party), a reference to a
10 merging society is a reference to the merged society; and
(d) a legal proceeding by or against a merging society that is
not finished when the merger takes effect may be continued
and finished by or against the merged society; and
(e) the duties, obligations, immunities, rights and privileges
15 applying to a merging society apply to the merged society.
Effect of transfer of engagements
375. (1) This section applies on a transfer of engagements under
this Division taking effect.
(2) However, for a partial transfer, this section applies --
20 (a) subject to the terms on which the transfer takes place; and
(b) only to the extent necessary to give effect to the transfer.
(3) The transferee society is the successor of the transferor society.
(4) Without limiting subsection (3) --
(a) the members of the transferor society become members of
25 the transferee society; and
(b) all assets and liabilities of the transferor society become
assets and liabilities of the transferee society without any
conveyance, transfer or assignment; and
(c) in all documents (including, for example, a contract to
30 which the transferor society was a party), a reference to the
transferor society is a reference to the transferee society;
and
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(d) a legal proceeding by or against the transferor society that
is not finished when the transfer takes effect may be
continued and finished by or against the transferee society;
and
5 (e) the duties, obligations, immunities, rights and privileges
applying to the transferor society apply to the transferee
society.
Division 3 -- Mergers and Transfers of Engagements Involving
Foreign Societies
10 Definitions in Division 3
376. In this Division --
''certificate of confirmation'' means a certificate given by the
SSA, or by the SSA of a participating State, to confirm a
transfer of engagements;
15 ''corresponding provision'', in relation to a specified provision
of this Code, means the provision of the friendly societies
legislation of the participating State corresponding to the
specified provision;
''foreign society'' means a body corporate that is a society under
20 the friendly societies legislation of another participating
State, whether or not it is registered as a foreign society
under Part 11;
''participating State'', in a provision of this Division about a
foreign society, means the State in which the foreign society
25 is incorporated;
''transferee society'' means --
(a) a society to which a foreign society is to transfer, or
has transferred, totally or partially, its engagements;
or
30 (b) a foreign society to which a society is to transfer, or
has transferred, totally or partially, its engagements;
''transferor society'' means --
(a) a society that is to transfer, or has transferred, totally
or partially, its engagements to a foreign society; or
35 (b) a foreign society that is to transfer, or has
transferred, totally or partially, its engagements to a
society.
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Proposal for merger or transfer of engagements
377. (1) This section applies if a society proposes a consolidation of
some or all of its assets, liabilities and undertakings with some or all of
the assets, liabilities and undertakings of a foreign society, by --
5 (a) the merger of the society and the foreign society; or
(b) a total or partial transfer of the engagements of the society
to the foreign society; or
(c) a total or partial transfer of the engagements of the foreign
society to the society.
10 (2) The proposed merger, or transfer of engagements, must be
approved by a special resolution of the society unless the SSA has
determined that it may be approved by the society's board.
(3) If the society is to approve the proposed merger or transfer of
engagements by special resolution, it must prepare, and send to each of
15 its members, a statement approved by the SSA specifying --
(a) the financial position of the society and foreign society 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
20 (b) if the proposal is for a merger, any proposal for the
composition of the board of directors of the merged society;
and
(c) if the proposal is for a total transfer of engagements, any
proposal for the composition of the board of directors of the
25 transferee society; and
(d) any interest that any officer of the society or foreign society
has in the proposed merger, or transfer of engagements;
and
(e) any compensation or other consideration proposed to be
30 paid, or any other incentive proposed to be given, to any
officer or member of the society or foreign society in relation
to the proposed merger, or transfer of engagements; and
(f) whether the proposal is a merger, or transfer of
engagements and the reason for the merger or transfer of
35 engagements; and
(g) if the proposal is for a transfer of engagements, whether it
is a total or partial transfer of engagements; and
(h) if the proposal is for a merger, the participating State in
which the merged society will be incorporated; and
40 (i) any other matter specified by the SSA.
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(4) If, under the corresponding provision to this section, the
foreign society is required to give its members a statement, the
statement given by the society and the statement given by the foreign
society must be consistent.
5 (5) The statement mentioned in subsection (3) must be sent to the
members of the society so that it will in the ordinary course of post
reach each member who is entitled to vote on the special resolution not
later than --
(a) if the resolution is to be decided at a meeting, 21 days
10 before the date of the meeting; or
(b) if the resolution is to be decided by a postal ballot, 21 days
before the day on or before which the ballot papers must be
returned by members voting in the ballot.
(6) The SSA may exempt the society --
15 (a) from the requirements to prepare the statement mentioned
in subsection (3) and to send the statement to its members;
or
(b) only from the requirement to send the statement mentioned
in subsection (3) to its members.
20 (7) The SSA may grant an exemption, or approve a statement,
subject to the conditions it considers appropriate.
SSA may register merged society
378. (1) This section applies if --
(a) a society proposes a merger with a foreign society; and
25 (b) the merged society is proposed to be incorporated in this
State.
(2) An application may be made to the SSA to register the merged
society.
(3) The application must be made by the society and the foreign
30 society jointly.
(4) The SSA must register the merged society if it is satisfied
that --
(a) the society has complied with section 377 and the foreign
society has complied with the corresponding provision to
35 section 377; and
(b) the proposed rules of the merged society are adequate; and
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(c) there are reasonable grounds for believing that the merged
society will be able to comply with the standards; and
(d) one of the following applies --
(i) the certificate of incorporation of the society has been
5 surrendered to the SSA;
(ii) the society's certificate of incorporation has been lost
or destroyed; and
(e) one of the following applies --
(i) the certificate of incorporation of the foreign society
10 has been surrendered to the SSA of the participating
State;
(ii) the foreign society has satisfied the SSA of the
participating State that its certificate of incorporation
has been lost or destroyed; and
15 (f) there is no good reason why the merged society and its
rules should not be registered.
(5) If the SSA registers the merged society, it must also --
(a) register its rules; and
(b) cancel the registration of the society.
20 (6) On registering the merged society, the SSA must issue a
certificate of incorporation to the merged society.
(7) A merger takes effect on the issue of the certificate of
incorporation under subsection (6).
(8) An application for the registration of a merger under this
25 Division --
(a) must be made in the way and form required by the SSA;
and
(b) must be accompanied by 2 copies of the proposed rules of
the merged society and any other particulars required by
30 the SSA.
Certificate of confirmation for total transfer
379. (1) This section applies if a society proposes a total transfer of
engagements from a foreign society to the society.
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(2) The society may apply to the SSA for a certificate of
confirmation of the total transfer of engagements.
(3) The SSA must issue a certificate of confirmation if it is
satisfied that --
5 (a) the society has complied with section 377 and the foreign
society has complied with the corresponding provision to
section 377; and
(b) the rules, or proposed new rules, of the society are
adequate; and
10 (c) one of the following applies --
(i) the certificate of incorporation of the foreign society
has been surrendered to the SSA of the participating
State;
(ii) the foreign society has satisfied the SSA of the
15 participating State that its certificate of incorporation
has been lost or destroyed; and
(d) there is no good reason why the transfer should not take
effect.
(4) An application for a certificate of confirmation of a total
20 transfer of engagements under this Division --
(a) must be made in the way and form required by the SSA;
and
(b) if new rules are proposed for the society, must be
accompanied by 2 copies of the proposed new rules.
25 Certificate of confirmation for partial transfer
380. (1) This section applies if a society proposes a partial transfer
of engagements from a foreign society to the society or from the society
to a foreign society.
(2) The society may apply to the SSA for a certificate of
30 confirmation of the partial transfer of engagements.
(3) The SSA must issue a certificate of confirmation if it is
satisfied that --
(a) the society has complied with section 377 and the foreign
society has complied with the corresponding provision to
35 section 377; and
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(b) the rules, or proposed new rules, of the transferee society
are adequate; and
(c) the SSA of the participating State has issued, or is about to
issue, a certificate of confirmation of the partial transfer of
5 engagements for the foreign society under the
corresponding provision to this section; and
(d) there is no good reason why the transfer should not take
effect.
(4) An application for a certificate of confirmation of a partial
10 transfer of engagements under this Division --
(a) must be made in the way and form required by the SSA;
and
(b) if the society is the transferee society, and new rules are
proposed for the society, must be accompanied by 2 copies of
15 the proposed new rules for the society.
When transfer of engagements takes effect
381. (1) This section applies to a total or partial transfer of
engagements from a society to a foreign society or from a foreign society
to a society.
20 (2) The transfer of engagements takes effect --
(a) if it is a total transfer of engagements --
(i) on the issue under section 379, or the corresponding
provision to section 379, of the certificate of
confirmation of the transfer; or
25 (ii) if a later time is stated in the certificate, at the later
time; or
(b) if it is a partial transfer of engagements --
(i) when the certificates of confirmation of the transfer
have issued, under section 380, and the corresponding
30 provision to section 380, to both the transferor and
transferee societies; or
(ii) if a later time is stated in the certificates, at the later
time.
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Effect of merger
382. (1) This section applies on a merger of a society and a foreign
society taking effect, whether the merged society is registered under
section 378 or the corresponding provision to section 378.
5 (2) The merged society is the successor of the merging societies.
(3) Without limiting subsection (2) --
(a) the members of each merging society become members of
the merged society; and
(b) all assets and liabilities of each merging society become
10 assets and liabilities of the merged society without any
conveyance, transfer or assignment; and
(c) in all documents (including, for example, a contract to
which a merging society was a party), a reference to a
merging society is a reference to the merged society; and
15 (d) a legal proceeding by or against a merging society that is
not finished when the merger takes effect may be continued
and finished by or against the merged society; and
(e) the duties, obligations, immunities, rights and privileges
applying to a merging society apply to the merged society.
20 Effect of transfer of engagements
383. (1) This section applies on a total transfer of engagements
taking effect under section 381.
(2) This section also applies on a partial transfer of engagements
taking effect under section 381, but only --
25 (a) subject to the terms on which the transfer takes place; and
(b) to the extent necessary to give effect to the transfer.
(3) The transferee society is the successor of the transferor society.
(4) Without limiting subsection (3) --
(a) the members of the transferor society become members of
30 the transferee society; and
(b) all assets and liabilities of the transferor society become
assets and liabilities of the transferee society without any
conveyance, transfer or assignment; and
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(c) in all documents (including, for example, a contract to
which the transferor society was a party), a reference to the
transferor society is a reference to the transferee society;
and
5 (d) a legal proceeding by or against the transferor society that
is not finished when the transfer of engagements takes
effect may be continued and finished by or against the
transferee society; and
(e) the duties, obligations, immunities, rights and privileges
10 applying to the transferor society apply to the transferee
society.
Surrender of certificate of incorporation
384. (1) This section applies if a society proposes --
(a) to merge with a foreign society, and under the proposal, the
15 merged society is to be incorporated in the participating
State; or
(b) a total transfer of its engagements to a foreign society.
(2) After the proposed merger or transfer has been approved under
section 377, the society must surrender its certificate of incorporation to
20 the SSA.
(3) Upon the merger or transfer of engagements taking effect
under the friendly societies legislation of the participating State, the
SSA must cancel the registration of the society.
Section number not used
25 385. See note to section 1.
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PART 8 -- CONVERSIONS TO COMPANIES AND
INCORPORATED ASSOCIATIONS
Division 1 -- Conversion to Company
Society may convert to company
5 386. Subject to its rules, a society may apply to the SSA for approval
of a proposal that the society convert to a company.
Proposal to convert by society to be approved by members
387. (1) Before a society applies to the SSA for approval to convert,
the proposal and the memorandum of association and articles of
10 association (if any) proposed for the company must be approved --
(a) in a postal ballot conducted in accordance with the
regulations in which not less than 20% (or in the case of a
society whose rules specify a greater percentage, that
greater percentage) of the members of the society have
15 voted; and
(b) by not less than 75% of the members who have voted; and
(c) where the society has issued shares of more than one class,
by members who have voted and who hold not less than
75% of the shares in each class held by all the members
20 who have voted.
(2) Before a society applies to the SSA for approval to convert, the
society must send to each of its members --
(a) a summary, approved by the SSA and containing such
information as is prescribed, of the proposed memorandum
25 of association and articles of association (if any) of the
proposed company; and
(b) a copy of such reports, valuations and other material
prepared by experts that may be required and approved by
the SSA; and
30 (c) a statement, the contents of which have been approved by
the SSA, relating to --
(i) the financial position of the society; and
(ii) the reasons for the proposal to convert; and
(iii) any interest that its officers may have in the
35 conversion; and
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(iv) any compensation or other consideration proposed to
be paid, or any other incentive proposed to be given,
to its officers arising out of the conversion; and
(v) any payments to be made to its members arising out
5 of the conversion; and
(vi) the proposals for dealing with any benefit funds of
the society; and
(d) any other matters that the SSA directs.
(3) The part of a statement under subsection (2) (c) (i) must
10 include --
(a) profit and loss accounts for the period up until a day not
more than 6 months before the day proposed for the
conversion, giving a true and fair view of the profit or loss
of the society and any fund of the society for that period;
15 and
(b) balance sheets as at the end of the last day of the period to
which the profit and loss accounts relate, giving a true and
fair view of the state of affairs of the society and any fund
of the society on that day; and
20 (c) a report prepared by the auditor of the society containing
prescribed statements and information relating to the
accounts for the period to which the profit and loss accounts
relate.
(4) The documents mentioned in subsection (2), and the ballot
25 papers to be used in the postal ballot, must be sent to the members of
the society so that they will in the ordinary course of post reach each
member who is entitled to vote not later than 21 days before the day on
or before which the ballot papers must be returned in accordance with
the regulations by members voting in the ballot.
30 (5) The SSA may exempt a society from having to comply with
subsection (2) or (3).
(6) The SSA may grant an exemption, or approve a summary or
statement, subject to any conditions it considers appropriate.
SSA may direct as to percentage
35 388. (1) If --
(a) a postal ballot is conducted for the purpose of section
387 (1); and
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(b) the percentage of members of the society who are required
to vote in the postal ballot is 20%; and
(c) less than 20% of members of the society vote in the postal
ballot,
5 the SSA may, by written notice given to the society, direct that for the
purpose of the postal ballot, the subsection is taken to have had effect
as if the percentage specified by the SSA in the notice had been
substituted for the 20% at all relevant times.
(2) The SSA must not give a notice to a society under
10 subsection (1) unless the SSA is of the opinion that it is in the interests
of the public, and of members of the society, to do so.
(3) A notice under subsection (1) has effect according to its tenor.
Application by society to SSA for approval of proposal
389. (1) An application for conversion by a society must be made in
15 the prescribed form and must be accompanied by --
(a) 2 copies of the proposed memorandum of association and
articles of association (if any) of the proposed company; and
(b) a copy of the register of members of the society and of the
register of members of each of the benefit funds of the
20 society verified by statutory declaration of a director and
made up so as to be complete and correct as at a day not
more than 6 days before the day of the application; and
(c) a statement setting out the day and terms on which the
conversion of the society to a company is proposed to take
25 effect; and
(d) any other documents or information that the SSA requires;
and
(e) the prescribed fee.
(2) In determining whether or not to approve the proposal to
30 convert, the SSA must have regard to --
(a) the public interest; and
(b) the interest of the members of the society to which the
proposal relates; and
(c) the information given to those members in relation to the
35 proposal and in relation to the interests of directors and
others promoting the proposal; and
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(d) whether the company would be subject to prudential
regulation similar to that applying to the society; and
(e) proposals for the payment of expenses associated with the
proposal; and
5 (f) any other relevant matter.
(3) The SSA --
(a) may approve the proposal to convert subject to any
conditions it considers appropriate; or
(b) may refuse to approve the proposal.
10 Conversion of society to company
390. If --
(a) a proposal by a society that it convert to a company is
approved by the SSA; and
(b) the company is formed and incorporated in accordance with
15 any conditions of the SSA's approval; and
(c) any other conditions of the approval relating to the transfer
of membership, issuing of shares or any other matter are
complied with,
then, on the day the society is registered as a company under the
20 Corporations Law --
(d) the property of the society vests in the company without
any conveyance, transfer or assignment subject to any debt,
liability or obligation affecting the property; and
(e) the debts and liabilities of the society become debts and
25 liabilities of the company; and
(f) the society's personality merges in that of the company.
Surrender of certificate of incorporation and cancellation of
registration of society
391. (1) A society that proposes to convert to a company must
30 surrender its certificate of incorporation to the SSA.
(2) On the conversion of a society to a company, the SSA must
cancel the registration of the society.
(3) A society that contravenes this section commits an offence.
Maximum penalty applying to subsection (3): $5 000.
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Certificate of SSA
392. (1) The SSA may, on application by the company resulting
from a conversion and production of any evidence that the SSA requires
and on payment of the prescribed fee, issue to the company a certificate
5 stating that a conversion under this Part has taken effect.
(2) A certificate issued by the SSA under subsection (1) is
conclusive evidence as to the matters so certified and that the
conditions of any approval have been complied with.
Division 2 -- Conversion to Incorporated Association
10 Society without benefit fund may convert to incorporated
association
393. Subject to its rules, a society that does not have a benefit fund
may apply to the SSA for approval of a proposal that the society convert
to an incorporated association.
15 Proposal to convert to be approved by members or society's
board
394. (1) Before a society applies to the SSA for approval to convert,
the proposal and the rules proposed for the incorporated association
must be approved --
20 (a) by a special resolution of the members of the society; or
(b) if the SSA so determines, by a resolution of the society's
board.
(2) If the proposal and the rules proposed for the incorporated
association are to be approved by special resolution under
25 subsection (1) (a), the society must send to each of its members --
(a) a summary, approved by the SSA and containing such
information as is prescribed, of the proposed rules of the
proposed incorporated association; and
(b) a copy of such reports, valuations and other material
30 prepared by experts that may be required and approved by
the SSA; and
(c) a statement, the contents of which have been approved by
the SSA, relating to --
(i) the financial position of the society; and
35 (ii) the reasons for the proposal to convert; and
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(iii) any interest that its officers may have in the
conversion; and
(iv) any compensation or other consideration proposed to
be paid, or any other incentive proposed to be given,
5 to its officers arising out of the conversion; and
(v) any payments to be made to its members arising out
of the conversion; and
(d) any other matters that the SSA directs.
(3) The part of a statement under subsection (2) (c) (i) must
10 include --
(a) the profit and loss account of the society for the period up
until a day not more than 6 months before the day proposed
for the conversion, giving a true and fair view of the profit
or loss of the society for that period; and
15 (b) a balance sheet as at the end of the last day of the period to
which the profit and loss account relates, giving a true and
fair view of the state of affairs of the society on that day;
and
(c) a report prepared by the auditor of the society containing
20 prescribed statements and information relating to the
accounts of the society for the period to which the profit and
loss account relates.
(4) The documents mentioned in subsection (2) must be sent to the
members of the society so that they will in the ordinary course of post
25 reach each member who is entitled to vote on the special resolution
under subsection (1) (a) not later than 21 days before the date of the
meeting at which the resolution will be determined.
(5) The SSA may exempt a society from having to comply with
subsection (2) or (3).
30 (6) The SSA may grant an exemption, or approve a summary or
statement, subject to any conditions it considers appropriate.
Application by society to SSA for approval of proposal
395. (1) An application for conversion by a society must be made in
the prescribed form and must be accompanied by --
35 (a) 2 copies of the proposed rules of the proposed incorporated
association; and
(b) a copy of the register of members of the society verified by
statutory declaration of a director and made up so as to be
complete and correct as at a day not more than 6 days
40 before the day of the application; and
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(c) a statement setting out the day and terms on which the
conversion of the society to an incorporated association is
proposed to take effect; and
(d) any other documents or information that the SSA requires;
5 and
(e) the prescribed fee.
(2) In determining whether or not to approve the proposal to
convert, the SSA must have regard to --
(a) the public interest; and
10 (b) the interests of the members of the society to which the
proposal relates; and
(c) the information given to those members in relation to the
proposal and in relation to the interests of directors and
others promoting the proposal; and
15 (d) proposals for the payment of expenses associated with the
proposal; and
(e) any other relevant matter.
(3) The SSA --
(a) may approve the proposal to convert subject to any
20 conditions it considers appropriate; or
(b) may refuse to approve the proposal.
Conversion of society to incorporated association
396. If --
(a) a proposal by a society that it convert to an incorporated
25 association is approved by the SSA; and
(b) the incorporated association is formed and incorporated in
accordance with any conditions of the SSA's approval; and
(c) any other conditions of the approval relating to the transfer
of membership or any other matter are complied with,
30 then, on the day the society is incorporated as an incorporated
association in accordance with the law of this State relating to
incorporated associations --
(d) the property of the society vests in the incorporated
association without any conveyance, transfer or assignment
35 subject to any debt, liability or obligation affecting the
property; and
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(e) the debts and liabilities of the society become debts and
liabilities of the incorporated association; and
(f) the society's personality merges in that of the incorporated
association.
5 Surrender of certificate of incorporation and cancellation of
registration of society
397. (1) A society that proposes to convert to an incorporated
association must surrender its certificate of incorporation to the SSA.
(2) On the conversion of a society to an incorporated association,
10 the SSA must cancel the registration of the society.
(3) A society that contravenes this section commits an offence.
Maximum penalty applying to subsection (3): $5 000.
Certificate of SSA
398. (1) The SSA may, on application by the incorporated
15 association resulting from a conversion and production of any evidence
that the SSA requires and on payment of the prescribed fee, issue to
the incorporated association a certificate stating that a conversion
under this Part has taken effect.
(2) A certificate issued by the SSA under subsection (1) is
20 conclusive evidence as to the matters so certified and that the
conditions of any approval have been complied with.
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PART 9 -- EXTERNAL ADMINISTRATION
Arrangements and reconstructions
399. (1) Parts 5.1 and 5.9 of the Corporations Law apply, with all
necessary modifications and any prescribed modifications, to or in
5 relation to a compromise or arrangement between a society and its
creditors or a reconstruction of a society.
(2) Without limiting subsection (1), a reference in Part 5.1 or 5.9 of
the Corporations Law to the Commission is taken to be a reference to
the SSA.
10 Receivers and other controllers of property of societies
400. (1) Parts 5.2 and 5.9 of the Corporations Law apply, with all
necessary modifications and any prescribed modifications, to or in
relation to a receiver or other controller of property of a society.
(2) Without limiting subsection (1), a reference in Part 5.2 or 5.9 of
15 the Corporations Law to the Commission is taken to be a reference to
the SSA.
Winding-up
401. (1) A society may be wound-up voluntarily or by the Court or
on a certificate of the SSA.
20 (2) Subject to this Part, a society may be wound-up in the way and
circumstances in which a company may be wound-up under the
Corporations Law.
Winding-up on certificate of SSA
402. (1) In the case of a winding-up on a certificate of the SSA, the
25 society may be wound-up if the SSA certifies that any of the following
events has happened --
(a) that the number of members is reduced to less than 25;
(b) that the society has not started business within a year of
registration or has suspended or ceased to carry on business
30 for a period of more than 6 months;
(c) that an event (to be specified in the certificate) has
happened on the happening of which the regulations or the
society's rules provide that the society is to be wound-up;
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(d) that the registration of the society has been obtained by
mistake or fraud;
(e) that the society exists for an illegal purpose;
(f) that the society has, after notice by the SSA of any
5 contravention of this Code or the society's rules, failed,
within the time specified in the notice, to remedy the
contravention or has committed any further contravention
of a kind specified in the notice;
(g) that there are, and have been for a period of one month
10 immediately before the date of the certificate, insufficient
directors of the society to constitute a quorum as provided
by the society's rules;
(h) that, because of an investigation under this Code into the
affairs of the society, it is in the interests of the public,
15 members or creditors that the society should be wound-up.
(2) The SSA must not so certify unless --
(a) the event has been proved to its satisfaction; and
(b) in the case of an event mentioned in subsection (1) (d), (e),
(f) or (h), AFIC has been informed of the happening of the
20 event.
(3) If the SSA so certifies, the SSA may appoint a person to be the
liquidator of the society.
(4) The liquidator appointed by the SSA may be employed in the
office of the SSA and, if so, need not be a registered liquidator under
25 the Corporations Law.
(5) The liquidator, unless employed in the SSA's office is entitled
to receive an amount of remuneration that the SSA considers
appropriate, having regard to the rate of payment that normally would
apply for such an appointment.
30 (6) Any vacancy in the office of a liquidator appointed under
subsection (3) must be filled by a person appointed by the SSA for the
purpose.
(7) A winding-up on a certificate of the SSA is taken to commence
on the date that the certificate is issued by the SSA.
35 (8) The liquidator must, within 14 days after the appointment,
give notice of the appointment by Gazette notice.
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Application of Corporations Law to winding-up
403. (1) Subject to this Part, Parts 5.4, 5.4A, 5.4B, 5.5, 5.6, 5.7A,
5.7B (except section 588G) and 5.9 of the Corporations Law apply, with
all necessary modifications and any prescribed modifications, to or in
5 relation to the winding-up or dissolution of a society or to a defunct or
dissolved society.
(2) Without limiting subsection (1), a reference in Parts 5.4, 5.4A,
5.4B, 5.5, 5.6, 5.7A, 5.7B (except section 588G) and 5.9 of the
Corporations Law --
10 (a) to a special resolution, is a reference to a special resolution
of the society within the meaning of this Code; and
(b) to the Commission, is a reference to the SSA; and
(c) to a voluntary winding-up, includes a reference to a
winding-up of a society on a certificate of the SSA.
15 Voluntary winding-up
404. (1) If a society is to be wound-up voluntarily, a person
employed in the office of the SSA may be appointed liquidator.
(2) If a society is being wound-up voluntarily and a vacancy
happens in the office of liquidator, a person employed in the office of
20 the SSA may be appointed liquidator to fill the vacancy.
(3) An appointment under subsection (1) or (2) is not effective
unless made with the written approval of the SSA.
(4) A person appointed as liquidator under this section need not be
a registered liquidator under the Corporations Law.
25 (5) The remuneration payable in relation to a liquidator appointed
under this section must be paid to the SSA.
Vacancy in office of liquidator on voluntary winding-up
405. Where --
(a) a society is being wound-up voluntarily; and
30 (b) the liquidator was not appointed under section 404; and
(c) a vacancy happens in the office of liquidator that, in the
SSA's opinion, is unlikely to be filled in the way provided
by Part 5.5 of the Corporations Law,
the SSA may appoint as liquidator, a person qualified under that Part
35 for such appointment.
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Remuneration of liquidator on voluntary winding-up
406. Despite anything in this Code or in the Corporations Law, the
remuneration paid to the liquidator of a society wound-up voluntarily
must not exceed the amount fixed by the SSA.
5 Priority on winding-up
407. (1) Subject to this section, in the winding-up of a society, the
assets of a society must first be applied in accordance with the
provisions of the Corporations Law referred to in section 403 (1) in
discharging debts and claims referred to in section 556 (1) of that Law.
10 (2) Subsection (1) has effect in relation to the assets of a benefit
fund of a society only to the extent that debts or claims are liabilities
that are referable to the fund.
(3) If any assets remain after the application of subsection (1) --
(a) any remaining assets of a benefit fund must be applied in
15 the following order of priority --
(i) first, in discharge of any liabilities of the society
referable to the fund other than liabilities determined
under section 408; and
(ii) secondly, in discharge of any liabilities of the society
20 referable to the fund determined under section 408;
and
(b) any remaining assets of the management fund must be
applied in discharge of any liabilities of the society.
(4) If any assets remain after the application of subsections (1)
25 and (3), those assets must be applied in such a manner as the Court
considers equitable, having regard to --
(a) the interests of the members of the society;
(b) the interests of creditors of the society whose debts have
not been discharged.
30 (5) If a liability of the society --
(a) is referable to 2 or more benefit funds; or
(b) is referable in part to a benefit fund and in part to other
business carried on by the society,
the liquidator may apportion the liability according to the proportion of
35 the liability borne by the benefit fund, or each benefit fund, as the case
may be.
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(6) In making an apportionment under subsection (5), the
liquidator must comply with any directions of the Court.
(7) The part of a liability apportioned to a benefit fund under
subsection (5) is to be treated as a liability of the society that is
5 referable to that fund.
Determination of amounts to be treated as liabilities
408. (1) In relation to each person who, according to the society's
records, appears to have an interest in a benefit fund, the liquidator
must determine --
10 (a) whether the society has a liability to the person in respect
of that interest; and
(b) if the society has such a liability, the amount of that
liability.
(2) Determinations under subsection (1) must be made by
15 reference to the rules of the society and in accordance with any
directions of the Court.
(3) The liquidator must notify each person referred to in
subsection (1) of the amount determined under that subsection and, if
the person has more than one interest in the benefit fund, the amount
20 determined in respect of each interest.
(4) If the liquidator determines an amount under subsection (1),
for the purposes of the winding-up --
(a) the society is to be taken to have a liability referable to the
benefit fund in that amount to the person to whom the
25 determination relates; and
(b) subject to subsection (5), that person is bound by the
liquidator's determination.
(5) A person who is notified of an amount under subsection (3)
may dispute the amount --
30 (a) in accordance with the rules of the Court; or
(b) as the Court otherwise directs in a particular case.
Cancellation of registration
409. As soon as practicable after the society is dissolved or taken to
be dissolved, the SSA must register the dissolution and cancel the
35 registration of the society.
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PART 10 -- SPECIAL INVESTIGATIONS
Definition
410. (1) In this Part --
''officer'', in relation to a society, includes --
5 (a) a person who acts, or who at any time acted, as
banker, solicitor, auditor, actuary or in any other
capacity for the society; and
(b) a person who --
(i) has, or has at any time had, in his or her
10 possession any property of the society; or
(ii) is indebted to the society outside the normal
trading terms of the person's membership; or
(iii) is capable of giving information concerning the
affairs of the society; and
15 (c) if an investigator has reasonable grounds for
suspecting or believing that a person is a person
mentioned in paragraph (b), that person.
(2) A reference in this Part to a society includes --
(a) if the SSA has given consent under section 412, a reference
20 to a related body corporate; and
(b) other than in that section, a reference to a services
corporation.
(3) Where 2 or more investigators have been appointed, whether
by the same instrument or by different instruments, to investigate
25 affairs of a society, each of those investigators may exercise the powers
or perform the functions under this Part independently of the other
investigator or investigators.
Appointment of investigators
411. (1) The SSA may appoint an investigator to investigate the
30 affairs of a society if the SSA considers that it is desirable to do so --
(a) for the protection of the public, or of the members or
creditors of the society; or
(b) in the public interest.
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(2) The SSA may appoint a person as investigator only if the
person has, in the SSA's opinion, the appropriate expertise for the
position (whether because of training or otherwise).
(3) The SSA must, in the instrument appointing an investigator,
5 specify full particulars of the appointment including --
(a) the matters into which the investigations are to be made,
being all the affairs or particular affairs of the society; and
(b) the terms and conditions (if any) to which the appointment
is subject.
10 (4) The SSA --
(a) may, in the instrument appointing an investigator, specify
the period in relation to which the investigation is to be
made; and
(b) may, at any time by written notice given to an investigator,
15 vary --
(i) particulars specified in the instrument of
appointment, being particulars mentioned in
subsection (3) (a) or (b); or
(ii) the period in relation to which the investigation is to
20 be made.
(5) The SSA may, by written notice given to an investigator,
terminate the appointment at any time.
Investigation of affairs of related body corporate
412. If an investigator thinks it necessary, for the purposes of the
25 investigation of affairs of a society, to investigate affairs of a body
corporate that is or has at any relevant time been a related body
corporate of the society, the investigator may with the written consent
of the SSA investigate affairs of that body.
Powers of investigators
30 413. (1) An investigator may, by giving written notice to an officer
of a society the affairs of which are being investigated under this Part,
require the officer --
(a) to produce to the investigator all documents of the society
and other documents relating to affairs of the society as are
35 in the custody or under the control of the officer; and
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(b) to give to the investigator all reasonable assistance in
connection with the investigation; and
(c) to appear before the investigator for examination on oath or
affirmation.
5 (2) An investigator may administer an oath or affirmation.
(3) An investigator must not exercise his or her powers under
subsection (1) in relation to an officer of a body corporate the affairs of
which he or she is investigating under section 412 unless he or she has
given to the officer of the body corporate a certificate stating that he or
10 she is investigating affairs of the body corporate under that section and
that the officer is an officer of the body corporate.
(4) Where documents are produced to an investigator under this
Part, the investigator may take possession of the documents for such
period as he or she considers necessary for the purpose of the
15 investigation.
(5) During that period, the investigator must permit a person who
would be entitled to inspect any one or more of those documents, if they
were not in the possession of the investigator, to inspect at all
reasonable times such of those documents as that person would be so
20 entitled to inspect.
Examination of officers
414. (1) If affairs of a society are being investigated under this
Part, an officer of the society must not --
(a) fail to comply with a requirement of an investigator under
25 section 413 to the extent to which he or she is able to
comply with it; or
(b) in purported compliance with such a requirement,
knowingly give information that is false or misleading in a
material particular; or
30 (c) when appearing before an investigator for examination
under such a requirement --
(i) make a statement that is false or misleading in a
material particular; or
(ii) fail to be sworn or make an affirmation.
35 Maximum penalty: $100 000 or imprisonment for 15 years, or
both.
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(2) A legal practitioner acting for the officer --
(a) may attend the examination; and
(b) may, to the extent that the investigator permits --
(i) address the investigator; and
5 (ii) examine the officer,
in relation to matters in relation to which the investigator has
questioned the officer.
(3) A person who complies with the requirement of an investigator
under this section does not incur any liability to any person merely
10 because of that compliance.
(4) A person required to attend for examination under this Part is
entitled to such allowances and expenses as are prescribed.
Self-incrimination
415. (1) An officer is not excused from --
15 (a) answering a question put to the officer by an investigator;
or
(b) producing a document to an investigator,
on the ground that the answer or production of the document might
tend to incriminate the officer.
20 (2) The answer is not admissible in evidence against the officer in
a criminal proceeding (other than a proceeding in relation to the falsity
of the answer or document) if --
(a) before answering the question or producing the document,
the officer claims that answering the question or production
25 of the document might tend to incriminate the officer; and
(b) answering the question or production of the document
might in fact tend to incriminate the officer.
Privileged communications
416. (1) An officer who is a legal practitioner may refuse to give
30 information or produce a document to an investigator if --
(a) the information or document is a privileged communication
between the legal practitioner as such and another person;
and
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(b) the other person does not agree to its being given or its
production; and
(c) subsection (2) does not apply.
(2) If the society to which the information or document relates is
5 being wound-up, the legal practitioner must give the information or
produce the document if the liquidator agrees to its being given or to its
production.
Maximum penalty: $75 000 or imprisonment for 10 years, or both.
(3) A legal practitioner commits an offence if he or she --
10 (a) refuses to give information or produce a document to an
investigator on the ground that it is a privileged
communication between the legal practitioner and another
person who has not agreed to its being given or to its
production; and
15 (b) knows the name of that other person and the residential or
other address at which the person might be found; and
(c) fails to comply with a request by the investigator to supply
the investigator with that name and address in writing.
Maximum penalty: $75 000 or imprisonment for 10 years, or both.
20 Failure of officer to comply with requirement of investigator
417. (1) If an officer of a society fails to comply with a requirement
of an investigator appointed to investigate affairs of the society, the
investigator may, unless the officer proves that the officer had a lawful
excuse for the failure, certify the failure by signed writing to the Court.
25 (2) If an investigator gives a certificate under subsection (1), the
Court may inquire into the case and --
(a) order the officer to comply with the requirements of the
investigator within a period fixed by the Court; or
(b) if the Court is satisfied that the officer failed without lawful
30 excuse to comply with the requirement of the investigator,
punish the officer in like way as if the officer had been
guilty of contempt of the Court and may also make an order
under paragraph (a).
Recording of examination
35 418. (1) An investigator may cause to be made a record of the
questions asked and the answers given at an examination under this
Part.
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(2) Except as provided by section 415, a record of the examination
of any person under this Part may be used in evidence in any legal
proceeding against the person.
(3) A copy of the record of the examination of any person must be
5 given without fee to the person upon the written request of the person.
(4) Nothing in this section affects or limits the admissibility of
other written or oral evidence.
(5) The SSA may give a copy of the record of any examination
made under this section to a legal practitioner who satisfies the SSA
10 that he or she is acting for a person who is conducting, or is in good
faith contemplating, legal proceedings in relation to affairs being
investigated by an investigator under this Part.
(6) A legal practitioner to whom a copy of a record is given under
subsection (5) must --
15 (a) use the record only in connection with the institution or
preparation of, and in the course of, legal proceedings; and
(b) not publish or communicate the record or any part of it for
any other purpose.
Maximum penalty: $75 000 or imprisonment for 10 years, or both.
20 (7) If a report is made under section 420, any record made under
this section relating to that report must be given with the report.
Delegation of powers by investigator
419. (1) An investigator may delegate the investigator's powers
under this Part except --
25 (a) the power to administer oaths or affirmations; and
(b) the power to examine on oath or affirmation.
(2) A delegate must produce the instrument of delegation for
inspection on request by an officer of a society the affairs of which are
being investigated under this Part.
30 Report of investigator
420. (1) An investigator may, and if so directed by the SSA must,
make interim reports to the SSA.
(2) On the completion or termination of the investigation, the
investigator must report to the SSA the investigator's opinion in
35 relation to the affairs the investigator has investigated, together with
the facts on which the opinion is based.
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(3) An investigator may, when making a report under this section,
give to the SSA any documents of which the investigator has taken
possession under section 413 (4).
(4) The SSA --
5 (a) may retain the documents for such period as it considers to
be necessary to enable a decision to be made as to whether
or not any legal proceeding ought to be instituted because
of the investigation; and
(b) may retain the documents for such further period as it
10 considers to be necessary to enable any such proceeding to
be instituted and prosecuted; and
(c) may permit other persons to inspect the documents while
they are in its possession; and
(d) may permit the use of the documents for the purposes of
15 any legal proceeding instituted as a result of the
investigation; and
(e) must permit a person who would be entitled to inspect any
of the documents if they were not in the possession of the
SSA to inspect at all reasonable times such of the
20 documents as the person would be so entitled to inspect.
(5) Subject to subsection (6), a copy of a final report must, and a
copy of the whole or any part of an interim report may if the SSA
considers it appropriate, be forwarded by the SSA to the registered
office of the society to which it relates.
25 (6) The SSA is not bound to give a society or any other person a
copy of a report, or any part of a report, by an investigator if the SSA is
of the opinion that there is good reason for not divulging the contents of
the report or part.
(7) The SSA may, if it is of the opinion that it is in the public
30 interest to do so, cause the whole or any part of a report to be printed
and published.
(8) If an investigator has caused a record of an examination under
this Part to be forwarded to the SSA with the report to which the
record relates, a copy of the record may, subject to section 418, be given
35 to such persons and on such conditions as the SSA considers
appropriate.
Proceedings following investigation
421. (1) If from a report under section 420 or from the record of an
examination under this Part, the SSA is of the opinion that an offence
40 may have been committed by a person and that a prosecution ought to
be instituted, the SSA must cause a prosecution to be instituted and
prosecuted.
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(2) The SSA may, by written notice given before or after the
institution of a prosecution under subsection (1), require an officer of
the society the affairs of which were investigated (not being an officer
who is or, in the opinion of the SSA, is likely to be, a defendant in the
5 proceeding) to give all assistance in connection with the prosecution or
proposed prosecution that he or she is reasonably able to give.
(3) If a person to whom a notice is given under subsection (2) fails
to comply with the requirement specified in the notice, the Court may
on the application of the SSA, direct that person to comply with the
10 requirement.
(4) If from a report of an investigator made under section 420 or
from the record of an examination under this Part, the SSA is of the
opinion that proceedings ought in the public interest to be brought by a
society the affairs of which were investigated by the investigator, for
15 the recovery of damages in relation to fraud, misfeasance or other
misconduct in connection with affairs of the society, or for the recovery
of property of the society, the SSA may cause proceedings to be
instituted accordingly in the name of the society.
Admission of investigator's report in evidence
20 422. (1) A document certified by the SSA as a copy of an
investigator's report is admissible in legal proceedings as evidence of --
(a) the investigator's report of his or her opinion for the
purposes of Part 9; and
(b) any facts or matters found by the investigator to exist.
25 (2) The court before which legal proceedings are brought against a
society or other person for or in respect of matters dealt with in an
investigator's report under section 420 may order that a copy of the
report be given to that society or person.
(3) Nothing in this section operates to diminish the protection
30 given to witnesses by law.
Expenses of investigation
423. (1) Subject to this section, the expenses of and incidental to an
investigation under this Part (including the costs incurred and payable
by the SSA in a proceeding brought by it in the name of a society) must
35 be paid by the SSA.
(2) If the SSA is of the opinion that the whole or any part of the
expenses of and incidental to an investigation into affairs of a society
under this Part (including the costs incurred and payable by it in a
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proceeding brought by it in the name of a society) should be paid by the
society, the SSA may --
(a) by order direct that the whole, or part of, the expenses be
so paid; or
5 (b) if they have been paid under subsection (1), direct the
society to reimburse the SSA; or
(c) in either case, direct the society to reimburse the SSA in
relation to the remuneration of any employee of the SSA
concerned with the investigation.
10 (3) An order under subsection (2) may specify --
(a) the amount of the expenses to be paid or reimbursed; and
(b) the time or times and the way in which the payment or
reimbursement of the expenses is to be made.
(4) If an order has been made by the SSA under subsection (2), the
15 society named in the order, to the extent specified in the order, is liable
to pay the expenses or reimburse the SSA in relation to the expenses.
(5) An amount for which the society is liable under an order under
subsection (2) may be recovered as a debt due to the SSA in a court
having jurisdiction for the recovery of debts up to the amount
20 concerned.
(6) An investigator may include in the report a recommendation
whether --
(a) an order under subsection (2) should be made; or
(b) an application under subsection (7) for a like order should
25 be made; or
(c) both an order and an application should be made.
(7) An application may be made to a court by or on behalf of the
SSA for the court to make the same order as the SSA is empowered to
make under subsection (2).
30 (8) The court may make an order with respect to the application or
its subject matter as it considers appropriate.
(9) Subsections (3), (4) and (5) apply to an order by the court as if
it were an order made by the SSA.
(10) An application under subsection (7) may be made --
35 (a) during proceedings in the court instituted in the name of
the society under section 421 (4); or
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(b) on, or within 14 days after, a conviction by the court in
proceedings certified by the SSA for the purposes of the
application to have been instituted as a result of an
investigation under this Part of affairs of a specified society.
5 Offences
424. A person who --
(a) conceals, destroys, mutilates or alters a document of or
relating to a society the affairs of which are being
investigated under this Part; or
10 (b) sends, causes to be sent or conspires with another person to
send, out of this State such a document or any property
belonging to or under the control of the society,
commits an offence.
Maximum penalty: $100 000 or imprisonment for 15 years, or
15 both.
Defence
425. In a prosecution for an offence against section 424, it is a
defence if the person charged proves that he or she did not act with
intent to defeat the purposes of this Part or to delay or obstruct the
20 carrying out of an investigation under this Part.
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PART 11 -- FOREIGN SOCIETIES
Definitions
426. In this Part --
''carrying on business'' means --
5 (a) establishing or using an office for receiving amounts
in consideration of the acquisition of an interest in a
society or contributions to a benefit fund of a society;
or
(b) advertising in relation to raising share capital or
10 inviting contributions to a benefit fund of a society,
but does not include --
(c) maintaining an account at a bank, building society or
credit union; or
(d) creating evidence of a debt or creating a charge on
15 property; or
(e) securing or collecting any debts or enforcing rights in
respect of such debts; or
(f) conducting an isolated transaction that is completed
within a period of 31 days, not being one of a number
20 of similar transactions repeated from time to time; or
(g) investing funds or holding property; or
(h) continuing to provide benefits to, and accept
contributions to a benefit fund from, a member who,
at the time of applying to contribute to a benefit fund,
25 was resident in another State and has subsequently
moved to this State; or
(i) continuing to receive amounts in consideration of an
interest in a society from a member who, at the time
of acquiring the interest, was resident in another
30 State and has subsequently moved to this State.
Registration
427. (1) A body corporate that is a society under the friendly
societies legislation of another participating State and that proposes to
carry on business as a society in this State may apply to the SSA in the
35 prescribed way to be registered as a foreign society.
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(2) An application for registration as a foreign society must be
accompanied by --
(a) a certificate issued within the preceding 2 months by the
SSA of the participating State in which the society is
5 incorporated stating that it considers there is no good
reason why the society should not be registered as a foreign
society in this State; and
(b) the documents given to the society under the provisions of
the friendly societies legislation of the participating State
10 corresponding to section 436 (2); and
(c) a statutory declaration by 2 directors of the society
stating --
(i) the name and address of the office of the person who
is to act as agent of the society in this State; and
15 (ii) any names that the society proposes to use in this
State that have been approved under Part 6A of the
AFIC Code and the conditions for the use of any
approved name; and
(ca) the prescribed fee; and
20 (d) any documents prescribed for the purpose of this section.
(3) If, on due application, the SSA is satisfied that the society is
eligible for registration, the SSA must --
(a) register the society as a foreign society and issue a
certificate of registration in accordance with the
25 regulations.
(b) See note to section 1.
(4) A society is not eligible for registration under this section
unless each name under which it proposes to carry on business in this
State --
30 (a) is identical with a name under which it carries on business
in the participating State in which the society is
incorporated; and
(b) has been reserved for the society for use in this State by
AFIC under Part 6A of the AFIC Code.
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Agents
428. (1) A foreign society must appoint a person to act as agent for
it in this State and must ensure that, at all times, it has such an agent.
(2) A foreign society must --
5 (a) appoint an agent who is a person ordinarily resident in this
State or a body corporate incorporated in this State; and
(b) obtain the written consent of the agent to act as the agent
of the society in this State; and
(c) authorize the agent to accept on the society's behalf service
10 of processes and notices; and
(d) ensure that the agent maintains an office in this State and
that the office is attended by the agent or a representative
of the agent at all times during ordinary business hours.
Section number not used
15 429. See note to section 1.
Liability of agent
430. An agent of a foreign society --
(a) is answerable for the doing of all acts, matters and things
that the foreign society is required by or under this Code to
20 do; and
(b) is personally liable to a penalty imposed on the foreign
society for a contravention of this Code if the court or
tribunal hearing the matter is satisfied that the agent
should be so liable.
25 Service on agent
431. (1) A document may be served on a foreign society by leaving
a copy of the document at, or posting it to, the office of the agent of the
foreign society in this State.
(2) See note to section 1.
30 (3) Nothing in this section affects --
(a) the power of the Court to authorize a document to be served
on a foreign society in a manner not provided for by this
section; or
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(b) the operation of the law of a State or the Commonwealth
authorizing a document to be served on a foreign society in
a manner not provided for by this section.
Application of Code to foreign societies
5 432. The prescribed provisions of this Code apply, with all necessary
modifications and any prescribed modifications, to a foreign society as if
the foreign society were a society.
SSA to be notified of certain changes
433. (1) A foreign society must, within one month after a change
10 affecting the agent of the foreign society (or the address of the agent's
office), lodge with the SSA particulars of that change accompanied by
the prescribed documents.
(2) A change referred to in subsection (1) takes effect at the end of
the day on which the society lodges the particulars and the documents
15 required under subsection (1).
Section number not used
434. See note to section 1.
Cessation of business
435. (1) A foreign society must, within 7 days of ceasing to carry on
20 business as a society in this State, notify the SSA in writing of that
fact.
Maximum penalty: $25 000.
(2) On notifying the SSA that it has ceased to carry on business as
a society in this State, a foreign society is no longer obliged to comply
25 with this Part.
(3) Unless the SSA has been notified in writing that the foreign
society has resumed carrying on business as a society in this State, the
SSA must, one year after receiving a notification under subsection (1),
cancel the registration of the foreign society.
30 Society proposing to register as foreign society
436. (1) A society that proposes to apply to be registered as a
foreign society in another participating State may apply to the SSA for
a certificate stating that it considers that there is no good reason why
the society should not be registered as a foreign society.
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(1A) An application under subsection (1) must be accompanied by
the prescribed fee.
(2) If the SSA issues the certificate, it must also give to the society
the prescribed documents.
5 SSA to provide certain documents
437. The SSA, on request by the SSA of a participating State in
which a foreign society (within the meaning of this Code) is registered
as a society must, without charge, provide copies of any public
documents that may be inspected at the office of the SSA in this State.
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PART 12 -- ASSOCIATIONS
Formation of associations
438. A body proposed to be an association may be formed by 2 or
more societies.
5 Objects of associations
439. The objects of an association are such of the following as are
authorized by the rules of the association --
(a) to promote the interests of, and strengthen co-operation
among, societies;
10 (b) to render services, other than financial or commercial
services, to its members;
(c) to act on behalf of its members;
(d) to advocate and promote practices and reforms that may be
conducive to objects of the association;
15 (e) to co-operate with other bodies with similar objects;
(f) to promote the formation of societies;
(g) to encourage the formulation, adoption and observance by
societies of standards and conditions governing the carrying
on of their business;
20 (h) to perform such other functions as may be prescribed.
Registration
440. (1) Two or more societies may apply to the SSA, in accordance
with the regulations, for a body to be registered under this Part as an
association.
25 (2) The application must be accompanied by --
(a) the proposed rules of the body; and
(b) such other documents as are prescribed; and
(c) such evidence as the SSA requires --
(i) that the body is eligible for registration as an
30 association; and
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(ii) that the body, if registered, will be able to comply
with the friendly societies legislation and all
applicable standards; and
(d) the prescribed fee.
5 (3) The SSA may, for the purposes of this section, accept a
statutory declaration as sufficient evidence of matters mentioned in the
declaration.
(4) If the SSA is satisfied that the body is eligible for registration,
the SSA must register the body as an association and register its
10 proposed rules.
(5) A body is eligible for registration as an association only if --
(a) the body's application for registration complies with this
Part; and
(b) the proposed rules of the body are not contrary to the
15 friendly societies legislation; and
(c) the objects of the body are appropriate for an association;
and
(d) there are reasonable grounds for believing that the body
will, if registered, be able to carry out its objects
20 successfully; and
(e) there is no good reason why the body should not be
registered.
Certificate of incorporation
441. (1) On registering an association under this Part, the SSA
25 must issue a certificate of incorporation to the association.
(2) A certificate of incorporation is conclusive evidence that all
requirements of this Part in relation to registration and matters
precedent or incidental to registration have been complied with.
Effect of incorporation
30 442. On the issue under this Part of a certificate of incorporation to
an association, the association is a body corporate with perpetual
succession and --
(a) has, subject to this Code and the association's rules, the
legal capacity of a natural person; and
35 (b) has a common seal; and
(c) may sue and be sued in its corporate name.
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Membership
443. (1) The members of an association are the societies by which
the association is formed, and any other societies that are admitted to
membership of the association under its rules.
5 (2) A body corporate that is a society under the friendly societies
legislation of another participating State may be admitted to
membership of an association.
Share capital
444. The share capital (if any) of an association must be divided into
10 shares in accordance with its rules.
Meetings
445. (1) Meetings of the members of an association must be
convened and conducted under the association's rules.
(2) A member of an association is, at any such meeting,
15 entitled --
(a) to be represented; and
(b) to exercise voting rights,
under the rules.
(3) An association must cause full and accurate minutes to be kept
20 of every meeting of its board and of the members of the association.
Application of Code to associations
446. The prescribed provisions of this Code apply, with all necessary
modifications and any prescribed modifications, to an association as if
the association were a society.
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PART 13 -- REVIEW OF DECISIONS
Reviewable decisions
447. (1) Every decision of the SSA made under the friendly
societies legislation is a reviewable decision.
5 (2) Subsection (1) does not apply to --
(a) a decision under --
(i) section 25; or
(ii) Subdivision 2; or
(iii) section 43; or
10 (iv) section 45; or
(v) section 46; or
(vi) Subdivision 7 of Division 2 of Part 2; or
(vii) section 55; or
(viii) section 228; or
15 (ix) section 367; or
(x) Part 10; or
(b) a decision under section 44 other than --
(i) a decision to remove an individual director; or
(ii) a decision to remove an auditor; or
20 (iii) a decision to remove an actuary; or
(iv) a decision directing a society to change any practice if
the practice is not dealt with by a standard; or
(c) a decision prescribed by a regulation made for the purposes
of this subsection.
25 Application for review of decisions
448. (1) A person whose interests are affected by a reviewable
decision may apply to the Appeals Tribunal for review of the decision.
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(2) The Appeals Tribunal has power to review any decision in
relation to which application is duly made to it under the friendly
societies legislation for review of the decision.
Application of AFIC Code
5 449. (1) The AFIC Code applies to the review of reviewable
decisions by the Appeals Tribunal.
(2) Without limiting subsection (1), the AFIC Code applies to --
(a) the parties to proceedings before the Appeals Tribunal; and
(b) the conduct of proceedings before the Appeals Tribunal; and
10 (c) the places where the Appeals Tribunal may sit; and
(d) the powers of the Appeals Tribunal and its members; and
(e) payment of costs; and
(f) appeals from decisions of the Appeals Tribunal; and
(g) the operation and implementation of decisions that are the
15 subject of review or appeal; and
(h) the protection and immunity of members of the Appeals
Tribunal, persons representing parties before the Tribunal
and persons summoned to attend or appearing before the
Tribunal; and
20 (i) offences in relation to the Appeals Tribunal and proceedings
of the Tribunal.
SSA to review certain decisions
450. (1) A person whose interests are affected by a decision of the
SSA made under the friendly societies legislation (other than a decision
25 to cancel the certificate of approval of an auditor or to refuse to consent
to the resignation of an auditor) may, by written notice given to the
SSA within one month after the decision is made, request the SSA to
review the decision.
(1A) A notice under subsection (1) must be accompanied by the
30 prescribed fee.
(2) The SSA must comply with a request under subsection (1).
(3) When reviewing a decision, the SSA must give the person who
requested the review an opportunity to appear before the SSA and
make a submission in relation to the decision.
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(4) The SSA may confirm, vary or reverse the decision.
(5) Section 448 applies whether or not a person has requested a
review of a decision under this section.
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PART 14 -- MISCELLANEOUS
Division 1 -- Evidence
Certificates etc.
451. (1) In a proceeding, a document that appears to be a
5 certificate of registration, certificate of incorporation or other certificate,
or an authority, issued by the SSA under this Code, or a copy of any
such document appearing to be certified as such by the SSA, is evidence
of the matters stated in the certificate, authority or copy.
(2) Judicial notice must be taken of the imprint of the SSA's seal
10 appearing on a document and the document must be presumed to have
been properly sealed until the contrary is proved.
(3) A copy of, or extract from, a document lodged with, created by
or otherwise held by the SSA, and certified to be a true copy or extract
under the SSA's seal --
15 (a) is as admissible in a proceeding as the original document;
and
(b) has the same validity in evidence as the original document
or the extracted part of the original document.
(4) In a proceeding, a certificate of the SSA stating that a
20 requirement of this Code specified in the certificate --
(a) had, or had not, been complied with at a date or within a
period specified in the certificate; or
(b) had been complied with at a date specified in the certificate
but not before that date,
25 is evidence of the matters specified in the certificate.
Rules
452. A printed copy of the rules of a society appearing to be certified
by the society's secretary to be a true copy of its registered rules is
evidence of the rules.
30 Registers
453. (1) The registers kept under this Code are evidence of the
particulars directed or authorized by or under this Code to be inserted.
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(2) A copy of an entry in a register is, if apparently certified by the
secretary of the society concerned to be a true copy of the entry in
question, evidence of the particulars to which the entry relates.
Minutes
5 454. (1) An entry in the minutes purporting to be --
(a) a minute of the business transacted at a meeting of a
society, members of a benefit fund of the society, or the
society's board; and
(b) signed by the chairperson of the meeting at which the
10 business was transacted or a subsequent meeting,
is evidence that the business as recorded 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 society, or of
members of a benefit fund of the society, to the effect that a resolution
15 was carried or was lost is evidence of the fact without proof of the
number or proportion of votes recorded for or against the resolution.
Entries
455. A copy of an entry in a book of a society regularly kept in the
course of business is, if certified by statutory declaration of the
20 secretary to be a true copy of the entry, admissible in evidence in any
case where, and to the same extent as, the original entry itself is
admissible.
Division 2 -- Offences
Defaults by societies
25 456. (1) A society must comply with a lawful requirement under
the friendly societies legislation to give information to the SSA or
another person.
(2) If a society contravenes subsection (1), the society and any
officer of the society who is in default each commit an offence.
30 Maximum penalty: $100 000 or imprisonment for 15 years, or
both.
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Restrictions on powers
457. (1) A society must not contravene a restriction imposed on its
powers, or in relation to its exercise of its powers, under the friendly
societies legislation.
5 Maximum penalty: $100 000.
(2) Without limiting subsection (1), a society must not --
(a) accept as a member a person who is not eligible for
membership under the society's rules; or
(b) raise money on loan or accept contributions to a benefit
10 fund except as authorized and within the limits imposed by
the friendly societies legislation or, subject to that
legislation, the society's rules.
(3) If a society contravenes this section, any officer of the society
who is in default commits an offence.
15 Maximum penalty applying to subsection (3): $100 000 or
imprisonment for 15 years, or both.
Offences by officers
458. (1) In this section and sections 459 and 460 --
''appropriate officer'' means --
20 (a) in relation to a society that is being wound-up, the
liquidator; and
(b) in relation to a society that is under the management
of an administrator, the administrator; and
(c) in relation to a society the affairs of which are being
25 investigated under Part 10, the person nominated as
the appropriate officer in the particular case by the
SSA; and
(d) in relation to a society in relation to which a receiver
or manager of all or any of the society's property has
30 been appointed, whether by the Court or under the
powers contained in any instrument, the receiver or
manager; and
(e) in relation to a society that, within the meaning of
subsection (2), has ceased to carry on business or is
35 unable to pay its debts, the SSA;
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''society to which this section applies'' means a society --
(a) that is being wound-up; or
(b) that is under the management of an administrator; or
(c) the affairs of which are being investigated under
5 Part 10; or
(d) in relation to which a receiver or manager has been
appointed, whether by the Court or under the powers
contained in any instrument; or
(e) that, within the meaning of subsection (2), has ceased
10 to carry on business or is unable to pay its debts;
''the relevant day'' means --
(a) in relation to a society that is being wound-up, the
day on which under this Code the winding-up has
started or is taken to have started; and
15 (b) in relation to a society that is under the management
of an administrator, the day on which the
administrator is appointed; and
(c) in relation to a society the affairs of which are being
investigated under Part 10, the day on which the
20 investigator under that Part was appointed; and
(d) in relation to a society in relation to which a receiver
or manager has been appointed, the day on which the
receiver or manager was appointed; and
(e) in relation to a society that is, within the meaning of
25 subsection (2), unable to pay its debts, the day on
which the execution or other process was returned
unsatisfied in whole or in part; and
(f) in relation to a society that has, within the meaning
of subsection (2), ceased to carry on business, the day
30 on which a letter was first sent to the society or a
notice was first published in the Gazette in relation to
the society.
(2) For the purposes of subsection (1), a society is taken to have
ceased to carry on business if the SSA --
35 (a) has sent to the society by post a letter under section 572 (1)
of the Corporations Law as applied by Part 9 and has not,
within one month of sending the letter, received an answer
to the effect that the society is carrying on business; or
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(b) has published in the Gazette a notice under section 572 (3)
of that Law as so applied.
(3) An officer, or former officer, of a society to which this section
applies who --
5 (a) does not to the best of the person's knowledge and belief
fully and truly disclose to the appropriate officer --
(i) all the property of the society; and
(ii) how and to whom and for what consideration and
when the society disposed of any part of its property,
10 except such part as has been disposed of in the
ordinary course of the society's business; or
(b) does not deliver up to the appropriate officer, or as the
appropriate officer directs --
(i) all the property of the society in the person's custody
15 or under the person's control and that the person is
required by law to deliver up; or
(ii) all documents in the person's custody or under the
person's control belonging to the society and that the
person is required by law to deliver up; or
20 (c) within 5 years before the relevant day or at any time on or
after that day --
(i) has concealed any part of the society's property to the
value of $100 or more, or has concealed a debt due to
or from the society; or
25 (ii) has fraudulently removed part of the society's
property to the value of $100 or more; or
(iii) has concealed, destroyed, mutilated or falsified, or has
been privy to the concealment, destruction, mutilation
or falsification of a document affecting, or relating to,
30 the society's property or affairs; or
(iv) has made, or has been privy to the making of, a false
entry in any document affecting, or relating to, the
society's property or affairs; or
(v) has fraudulently parted with, altered or made any
35 omission in, or has been privy to fraudulent parting
with, altering or making an omission in a document
affecting or relating to the society's property or
affairs; or
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(vi) by a false representation or other fraud, has obtained
on credit for or on behalf of the society, property that
the society has not subsequently paid for; or
(vii) has obtained on credit for or on behalf of the society,
5 under the false pretence that the society is carrying
on business, property that the society has not
subsequently paid for; or
(viii) has pawned, pledged or disposed of any of the
society's property that has been obtained on credit
10 and has not been paid for, unless the pawning,
pledging or disposing was in the ordinary course of
the society's business; or
(d) knowingly makes any material omission in any statement
relating to the society's affairs; or
15 (e) knowing or believing that a false debt has been proved by
any person, fails for a period of one month to inform the
appropriate officer of the knowledge or belief; or
(f) prevents the production of any document affecting or
relating to the society's property or affairs; or
20 (g) within 5 years before the relevant day, or at any time on or
after that day, has attempted to account for any part of the
society's property by making entries in the society's
documents showing fictitious transactions, losses or
expenses; or
25 (h) within 5 years before the relevant day, or at any time on or
after that day, has been guilty of any false representation
or other fraud for the purpose of obtaining the consent of
the society's creditors or any of them to an agreement
relating to the society's affairs or to the winding-up,
30 commits an offence.
Maximum penalty applying to subsection (3): $100 000 or
imprisonment for 15 years, or both.
(4) It is a defence to a charge --
(a) under subsection (3) (a), (b) or (d) or subsection (3) (c) (i),
35 (vii) or (viii), if the accused person proves that the person
had no intent to defraud; and
(b) under subsection (3) (c) (iii) or (iv) or subsection (3) (f), if
the accused person proves that the person had no intent to
conceal the state of affairs of the society or to defeat the
40 law.
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(5) If a person pawns, pledges or disposes of property in
circumstances that amount to an offence under subsection (3) (c) (viii), a
person who takes in pawn or pledge or otherwise receives the property
knowing it to be pawned, pledged or disposed of in those circumstances
5 commits an offence.
Maximum penalty applying to subsection (5): $100 000 or
imprisonment for 15 years, or both.
Incurring debts not likely to be paid
459. (1) If an officer of a society to which section 458 applies was
10 knowingly a party to the contracting of a debt by the society and had at
the time the debt was contracted, no probable or reasonable grounds of
expectation, after taking into consideration the society's other liabilities
(if any) at the time, of the society being able to pay the debt, the officer
commits an offence.
15 Maximum penalty: $25 000.
(2) If any business of a society to which section 458 applies has
been carried out with intent to defraud the society's creditors or
creditors of another person or for any fraudulent purpose, a person who
is knowingly a party to the carrying on of the business in that way
20 commits an offence.
Maximum penalty: $100 000 or imprisonment for 15 years, or
both.
Powers of Court
460. (1) If a person has been convicted of an offence under
25 section 459, the Court on the application of the SSA or a prescribed
person may declare that the person is personally responsible without
any limitation of liability --
(a) in the case of a conviction under section 459 (1), for the
payment to the society of an amount equal to the whole of
30 the debt to which the conviction relates or such part of the
debt as the Court considers appropriate; and
(b) in the case of a conviction under section 459 (2), for the
payment to the society of the amount required to satisfy all
or any of the society's debts as the Court considers
35 appropriate.
(2) In relation to a society to which a conviction mentioned in
subsection (1) relates --
(a) the appropriate officer; and
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(b) a creditor of the society authorized by the SSA to make an
application under subsection (1),
are prescribed persons for the purposes of that subsection.
(3) If the Court makes a declaration under subsection (1) in
5 relation to a person it may --
(a) give such further directions as it considers proper for the
purpose of giving effect to the declaration and, in
particular, may order that the liability of the person under
the declaration is a charge on --
10 (i) a debt or obligation due from the society to the
person; or
(ii) any charge or any interest in any charge on any of
the society's assets held by or vested in the person or
any body corporate or person on the person's behalf or
15 any person claiming as assignee from or through the
person liable or any body corporate or person acting
on the person's behalf; or
(b) from time to time make such further order as is necessary
for the purpose of enforcing a charge imposed under this
20 subsection.
(4) This section has effect despite the fact that the person
concerned is criminally liable in relation to the matters on the ground
on which the declaration is made.
(5) On the hearing of an application under subsection (1), the
25 appropriate officer or other applicant may give evidence or call
witnesses.
(6) In subsection (3) --
''assignee'' includes any person to whom or in whose favour, by
the direction of the person liable, the debt, obligation, or
30 charge was created, issued or transferred or the interest
created, but does not include an assignee for valuable
consideration (other than consideration by way of marriage)
given in good faith and without notice of any of the matters
on which the conviction or declaration was made.
35 Inducement to be appointed as liquidator
461. A person must not give, or agree or offer to give, to a member or
creditor of a society valuable consideration with a view to securing the
person's appointment or nomination, or to securing or preventing the
appointment or nomination of another person, as the liquidator of the
40 society.
Maximum penalty: $75 000 or imprisonment for 10 years, or both.
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Falsification of records
462. (1) An officer of a society must not destroy, mutilate, alter or
falsify a document or security, or make or be privy to the making of any
false or fraudulent entry in a document, belonging to the society with
5 intent to defraud or deceive a person.
(2) A person who, having a duty to record information in the
documents of a society, fails to record the information in the
documents --
(a) with intent to defraud another person; or
10 (b) knowing that the failure will render other matter contained
in the documents false or misleading in a material
particular,
commits an offence.
Maximum penalty: $100 000 or imprisonment for 15 years, or
15 both.
Frauds by officers
463. An officer of a society who --
(a) by false pretence, or by means of another fraud, induces a
person to give credit to the society; or
20 (b) with intent to defraud creditors of the society, makes or
causes to be made a gift or transfer of, or charge on, or
causes or connives at the levying of any execution against,
the society's property; or
(c) with intent to defraud the society's creditors, conceals or
25 removes part of the society's property within 2 months
before, or after, the date of any unsatisfied judgment or
order for payment of money obtained against the society,
commits an offence.
Maximum penalty: $100 000 or imprisonment for 15 years, or
30 both.
False or misleading information
464. A person must not make available, or give, information in a
return, report, certificate, accounts or other document required by or for
the purposes of this Code (other than Part 4B) or the friendly societies
35 legislation or a standard --
(a) that the person knows is false or misleading in a material
particular; or
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(b) that has omitted from it a matter or thing the omission of
which makes the information misleading in a material
particular.
Maximum penalty: $100 000 or imprisonment for 15 years, or
5 both.
Power to examine defaulting officers
465. (1) In this section --
''society to which this section applies'' means a society --
(a) that has been, or is being, wound-up; or
10 (b) that is under the management of an administrator; or
(c) the affairs of which are being investigated under
Part 10; or
(d) in relation to which a receiver or manager has been
appointed, whether by the Court or under the powers
15 contained in any instrument; or
(e) that, within the meaning of subsection (2), has ceased
to carry on business or is unable to pay its debts; or
(f) that has entered into a compromise or scheme of
arrangement with its creditors.
20 (2) For the purposes of subsection (1), a society has ceased to carry
on business in the circumstances mentioned in section 458 (2).
(3) This section applies if it appears to the SSA that an officer or
former officer of a society to which this section applies has conducted
himself or herself in such a way that the officer or former officer has
25 rendered himself or herself liable to action by the society in relation to
the performance of the person's duties as an officer of the society.
(4) The SSA, or a person who is authorized by it in that behalf,
may apply ex parte to the Court for an order that the officer or former
officer must attend before the Court on a day appointed by the Court to
30 be examined as to the person's conduct and dealings as an officer of the
society.
(5) An examination under this section must not be held in open
court unless the Court otherwise orders.
(6) The Court, on making the order under subsection (4) or at any
35 subsequent time, on the application of any person concerned, may give
such directions as to the matters to be inquired into and as to the
procedure to be followed in relation to the examination as it considers
appropriate.
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(7) The applicant and, with the leave of the Court, a creditor or
member of the society, may take part in the examination either
personally or by a legal practitioner.
(8) The person examined --
5 (a) must be examined on oath; and
(b) must answer all questions that the Court puts or allows to
be put; and
(c) is not entitled to refuse to answer a question that is
relevant or material to the examination on the ground that
10 the answer might tend to incriminate the person.
(9) The answer to a question put to a person under this section is
not admissible in evidence against the person in a criminal proceeding
(other than a proceeding in relation to the falsity of the answer) if --
(a) before answering the question, the person claims that
15 answering the question might tend to incriminate the
person; and
(b) answering the question might in fact tend to incriminate
the person.
(10) A person ordered to be examined under this section may be
20 represented by a legal practitioner who is at liberty to put to the person
examined any questions for the purpose of enabling the person to
explain or qualify any answer given.
(11) Notes of the examination --
(a) must be reduced to writing; and
25 (b) must be read over to and signed by the person examined;
and
(c) may, subject to subsection (9), be used in evidence in a legal
proceeding against the person examined; and
(d) may be inspected and copied by the person examined, the
30 SSA or applicant or, with the consent of the Court, by a
creditor or member of the society.
(12) The Court may adjourn the examination from time to time.
(13) If the Court is satisfied that an order for an examination
under this section was obtained without reasonable cause, it may order
35 the whole or any part of the costs incurred by the person ordered to be
examined to be paid by the applicant or another person who with the
consent of the Court takes part in the examination.
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Power of Court to assess damages against certain persons
466. (1) In this section --
''society to which this section applies'' means a society --
(a) that is being wound-up; or
5 (b) that is under the management of an administrator; or
(c) the affairs of which are being investigated under
Part 10; or
(d) in relation to which a receiver or manager has been
appointed, whether by the Court or under the powers
10 contained in any instrument; or
(e) that, within the meaning of subsection (2), has ceased
to carry on business or is unable to pay its debts; or
(f) that has entered into a compromise or scheme of
arrangement with its creditors;
15 ''prescribed person'' means --
(a) a liquidator or provisional liquidator of the society
concerned; or
(b) if the society concerned is under the management of
an administrator, the administrator or a member of
20 the society; or
(c) a person authorized by the SSA to apply under
subsection (3).
(2) For the purposes of subsection (1), a society has ceased to carry
on business in the circumstances mentioned in section 458 (2).
25 (3) If, on application by the SSA or a prescribed person, the Court
is satisfied that a person who has taken part in the formation,
promotion, administration, management or winding-up of a society to
which this section applies --
(a) has misapplied or retained or become liable or accountable
30 for property of the society; or
(b) has been guilty of negligence, default, breach of trust or
breach of duty in relation to the society and that the society
has suffered, or is likely to suffer, loss or damage as a
result,
35 the Court may make one or both of the orders mentioned in
subsection (4).
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(4) The orders that may be made under subsection (3) are --
(a) an order directing the person to pay money or transfer
property to the society; and
(b) an order directing the person to pay to the society the
5 amount of the loss or damage.
(5) This section applies to the receipt of any money or property by
an officer or former officer of the society, whether by way of salary or
otherwise, that appears to the Court to have been unfair or unjust to
the society or its members.
10 (6) This section applies despite the fact that the person concerned
may be criminally liable in relation to the matters in relation to which
the order is sought.
(7) If the Court is satisfied that an application was made under
this section without reasonable cause, it may order the whole or any
15 part of the costs incurred by the person against whom the order was
sought to be paid by the applicant.
False copies of rules
467. A person must not --
(a) give to a member of a society or a person intending or
20 applying to become a member, a copy of any rules or any
amendment of the rules other than those that have been
duly registered, representing that they are binding on the
society's members; or
(b) make any amendment in any of the rules of the society
25 after they have been duly registered and circulate them
representing that they have been duly registered.
Maximum penalty: $25 000.
Fraud or misappropriation
468. A person must not --
30 (a) by false representation or imposition obtain possession of
property of a society; or
(b) having property of a society in the person's possession,
withhold or misapply that property, or wilfully apply part of
the property, to purposes other than those specified or
35 authorized in the society's rules or by or under the friendly
societies legislation.
Maximum penalty: $100 000 or imprisonment for 15 years, or
both.
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Commissions
469. (1) An officer of a society must not accept from a person who
enters into a transaction with the society a commission, fee or reward,
whether pecuniary or otherwise, for or in connection with that
5 transaction.
Maximum penalty: $5 000.
(2) An officer of a society who commits an offence against
subsection (1) is indebted to the society for double the value or amount
of the commission, fee or reward.
10 Officers and other persons in default
470. If this Code provides that an officer of a society or other body
corporate who is in default commits an offence, the reference to the
officer who is in default is, in relation to a contravention of, or an
offence against, this Code, a reference to an officer of the society or
15 other body corporate (including a person who subsequently ceased to be
such an officer) who is in any way by act or omission, directly or
indirectly, knowingly concerned in or party to the contravention or
offence.
Division 3 -- Proceedings
20 Proceedings for offences
471. (1) A proceeding for an offence against this Code may be
brought by --
(a) the SSA; or
(b) a person authorized in writing by the SSA.
25 (2) A proceeding may be started within --
(a) for an alleged offence not punishable by imprisonment,
2 years; and
(b) for an alleged offence punishable by imprisonment, 5 years,
after the alleged offence is committed or, with the consent of the
30 Minister, at any later time.
Reciprocity in relation of offences
472. If a person does or omits to do anything in this State and the
person, if the person had done or omitted to do the thing in another
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Friendly Societies (Western Australia)
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participating State, would have committed an offence against the
provision of a law of that State that corresponds with a provision of this
Code, the person commits an offence against that provision of this Code.
Continuing offences
5 473. (1) If --
(a) under this Code anything is required or directed to be done
within a particular period or before a particular time; and
(b) failure to do the thing within the period or before the time
constitutes an offence; and
10 (c) the thing is not done within the period or before the time,
then --
(d) the obligation to do the thing continues, despite the fact
that the period has expired or the time has passed, until
the thing is done; and
15 (e) if a person is convicted of an offence that is constituted by
failure to do the thing within that period or before the time,
the person commits a separate and further offence in
relation to each day after the day of the conviction during
which the failure to do the thing continues; and
20 (f) the penalty applicable to each such separate and further
offence is $500.
(2) If --
(a) under this Code anything is required or directed to be done
but no period within which or time by which the thing is to
25 be done is specified; and
(b) failure to do the thing constitutes an offence; and
(c) a person is convicted of an offence in relation to a failure to
do the thing,
the person commits a separate and further offence in relation to each
30 day after the day of the conviction during which the failure to do the
thing continues and the penalty applicable to each such separate and
further offence is $500.
Injunctions
474. (1) If a person has engaged, is engaging or is proposing to
35 engage in conduct that constituted, constitutes or would constitute --
(a) a contravention of this Code; or
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(b) attempting to contravene this Code; or
(c) aiding, abetting, counselling or procuring a person to
contravene this Code; or
(d) inducing or attempting to induce (whether by threats,
5 promises or otherwise) a person to contravene this Code; or
(e) being in any way, directly or indirectly, knowingly
concerned in, or party to, the contravention by a person of
this Code; or
(f) conspiring with others to contravene this Code,
10 the Court may, on the application of the SSA or a person whose
interests have been, are or would be affected by the conduct, grant an
injunction restraining the person from engaging in the conduct and, if
in the Court's opinion it is desirable to do so, requiring that person to
do anything.
15 (2) If a person has failed, is failing, or is proposing to fail, to do
anything that the person is required to do under this Code, the Court
may, on the application of --
(a) the SSA; or
(b) a person whose interests have been, are or would be
20 affected by the failure to do the thing,
grant an injunction, requiring the person to do the thing.
(3) If an application is made for an injunction under subsection (1)
or (2), the Court may grant an injunction by consent of all the parties to
the proceeding, whether or not the Court is satisfied that the subsection
25 applies.
(4) The Court may grant an interim injunction pending
determination of an application under subsection (1).
(5) The Court may discharge or vary an injunction granted under
this section, and may grant an injunction on conditions.
30 (6) The power of the Court to grant an 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 the
conduct; and
35 (b) whether or not the person has previously engaged in
conduct of that kind; and
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(c) whether or not there is an imminent danger of substantial
damage to another person if the person engages, or
continues to engage, in the conduct.
(7) The power of the Court to grant an injunction requiring a
5 person to do a thing may be exercised --
(a) whether or not it appears to the Court that the person
intends to fail again, or to continue to fail, to do the thing;
and
(b) whether or not the person has previously failed to do the
10 thing; and
(c) whether or not there is an imminent danger of substantial
damage to another person if the person fails, or continues to
fail, to do the thing.
(8) If the SSA applies to the Court for the grant of an injunction
15 under this section, the Court must not require the applicant or another
person, as a condition of granting an interim injunction, to give an
undertaking as to damages.
(9) In a proceeding under this section against a person, the Court
may make an order under section 299 in relation to the person.
20 (10) If the Court has power under this section to grant an
injunction restraining a person from engaging in particular conduct or
requiring a person to do a particular thing, the Court may, either in
addition to or in substitution for the grant of the injunction, order the
person to pay damages to another person.
25 (11) The Court's powers under this section are in addition to its
other powers.
Penalty notices
475. (1) If the SSA or a person authorized by it has reason to
believe that a person (including a society) has committed a prescribed
30 offence, the SSA or authorized person may serve on the person a notice
in accordance with the regulations --
(a) alleging that the person has committed the prescribed
offence and giving the prescribed particulars in relation to
the prescribed offence; and
35 (b) setting out the prescribed penalty in relation to the
prescribed offence; and
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(c) in the case of a prescribed offence constituted by a failure to
do a particular thing, stating --
(i) that the obligation to do the thing continues despite
the service of the notice or the payment of the
5 prescribed penalty; and
(ii) that if, within the period specified in the notice (not
less than 21 days), the person pays the prescribed
penalty to the authority specified in the notice and
does the thing, no further action will be taken against
10 the person in relation to the prescribed offence; and
(iii) that if, at the end of the period specified in the notice,
the person has not paid the prescribed penalty to the
authority specified in the notice or has not done the
thing, a proceeding may be instituted against the
15 person; and
(d) in the case of a prescribed offence that is not constituted by
a failure to do a particular thing, stating --
(i) that if, within the period specified in the notice (not
less than 21 days), the person pays the prescribed
20 penalty to the authority specified in the notice, no
further action will be taken against the person in
relation to the prescribed offence; and
(ii) that if, at the end of the period specified in the notice,
the person has not paid the prescribed penalty to the
25 authority specified in the notice, a proceeding may be
instituted against the person.
(2) Subsection (1) does not authorize the SSA or an authorized
person --
(a) to serve on a person more than one notice under that
30 subsection in relation to an alleged commission by the
person of a particular prescribed offence; or
(b) to serve on a person a notice under that subsection in
relation to a prescribed offence unless proceedings could be
instituted against the person for the offence under
35 section 471.
(3) If a notice under subsection (1) is served on a person in
relation to a prescribed offence constituted by the failure to do a
particular thing --
(a) if, within the period specified in the notice, the person pays
40 the prescribed penalty to the authority specified in the
notice and does the thing, no proceedings may be instituted
against the person in relation to the prescribed offence; or
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(b) if, at the end of the period specified in the notice, the
person has paid the prescribed penalty to the authority
specified in the notice, but has not done the thing, no
proceedings may be instituted against the person in relation
5 to the prescribed offence, but the obligation to do the thing
continues; or
(c) if, at the end of the period specified in the notice, the
person has not paid the prescribed penalty to the authority
specified in the notice, but has done the thing, a proceeding
10 may be instituted against the person in relation to the
prescribed offence; or
(d) if, at the end of the period specified in the notice, the
person has not paid the prescribed penalty to the authority
specified in the notice and has not done the thing, the
15 obligation to do the thing continues, and a proceeding may
be instituted against the person in relation to the
prescribed offence.
(4) If a notice under subsection (1) is served on a person in
relation to a prescribed offence, that is not constituted by a failure to do
20 a particular thing --
(a) if, within the period specified in the notice, the person pays
the prescribed penalty to the authority specified in the
notice, no proceedings may be instituted against the person
in relation to the prescribed offence; or
25 (b) if, at the end of the period specified in the notice, the
person has not paid the prescribed penalty to the authority
specified in the notice, a proceeding may be instituted
against the person in relation to the prescribed offence.
(5) The payment of an amount by a person under a notice served
30 on the person under this section in relation to a prescribed offence is
not to be taken for any purpose to be an admission by that person of
any liability in connection with the alleged commission of the prescribed
offence.
Power to grant relief
35 476. (1) This section applies to a person who is --
(a) an officer of a society; or
(b) an auditor or actuary of a society, whether or not the
auditor or actuary is an officer of the society; or
(c) an expert in relation to a matter in relation to which the
40 civil proceeding has been taken or the claim will or might
arise; or
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(d) a receiver, receiver and manager, liquidator or other person
appointed or directed by the Court to carry out any duty in
relation to a society.
(2) If, in a civil proceeding against a person to whom this section
5 applies for negligence, default, breach of trust or breach of duty in a
capacity by virtue of which the person is such a person, it appears to
the court before which the proceeding is taken that the person is or
may be liable in relation to the negligence, default or breach but has
acted honestly and, having regard to all the circumstances of the case,
10 including those connected with the person's appointment, ought fairly to
be excused for the negligence, default or breach, the court may relieve
the person either wholly or partly from the liability on such terms as
the court considers appropriate.
(3) If a person to whom this section applies has reason to
15 apprehend that any claim will or might be made against the person in
relation to any negligence, default, breach of trust or breach of duty in
a capacity by virtue of which the person is such a person, the person
may apply to the Court for relief, and the Court has the same power to
grant relief as it would have had under subsection (2) if it had been a
20 court before which a proceeding against the person for negligence,
default, breach of trust or breach of duty had been brought.
Division 4 -- Other matters
Secrecy
477. (1) In this section --
25 ''court'' includes a tribunal, authority or person having the power
to lawfully require the production of documents or the
answering of questions;
''financial sector supervisory agency'' means a person or body
declared by the regulations to be a financial sector
30 supervisory agency for the purposes of this section;
''Government agency'' includes a person or body declared by
the regulations to be an agency of a State or Territory
Government;
''law enforcement agency'' means a person or body declared by
35 the regulations to be a law enforcement agency for the
purposes of this section;
''protected document'' means a document that --
(a) contains information that concerns a person; and
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Friendly Societies (Western Australia)
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(b) is obtained or made by a person to whom this section
applies in the course of, or because of, the person's
duties under or in relation to the friendly societies
legislation;
5 ''protected information'' means information that --
(a) concerns a person; and
(b) is disclosed to, or obtained by, a person to whom this
section applies in the course of, or because of, the
person's duties under or in relation to the friendly
10 societies legislation.
(2) This section applies to a person who is or has been appointed
or employed by AFIC or the SSA for the purposes of carrying out any
duties under the friendly societies legislation.
(3) A person to whom this section applies must not --
15 (a) make a record of protected information; or
(b) whether directly or indirectly, divulge or communicate to a
person protected information concerning another person,
unless the record is made, or the information divulged or
communicated --
20 (c) under or for the purposes of friendly societies legislation; or
(d) in the performance of duties, as a person to whom this
section applies, under or in relation to the friendly societies
legislation.
Maximum penalty: $25 000.
25 (4) Subsection (3) does not prevent a person to whom this section
applies from disclosing protected information or producing a protected
document, to --
(a) a court; or
(b) AFIC or the SSA of another State;
30 (c) a financial sector supervisory agency for the purposes of the
performance of any of its functions or the exercise of any of
its powers;
(d) a law enforcement agency for the purposes of the
performance by the agency of its functions in relation to an
35 offence or alleged offence against a law of the
Commonwealth or a State;
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(e) a Minister or nominee of the Minister;
(f) a Government agency.
(5) Subsection (3) does not prohibit a person to whom this section
applies from disclosing protected information or producing a protected
5 document relating to the affairs of a person if the person agrees in
writing to the disclosure of the protected information or the production
of a protected document.
(6) A person to whom this section applies cannot be required to
produce to a court any protected document or to disclose protected
10 information except when it is necessary to do so for the purposes of the
friendly societies legislation.
Powers about money of members who have died
478. If a member of a society dies, the society may, without
production of probate of the will or letters of administration of the
15 estate, apply an amount (not exceeding the amount prescribed by the
regulations) held by the society for the deceased person --
(a) in payment of the deceased person's funeral expenses or
debts; or
(b) in payment to the executor of the deceased person's will; or
20 (c) in payment to anyone else who is, in the society's opinion,
entitled to the amount, having regard to the will of the
deceased person or, if there is no will, the laws of intestacy.
Limitation of doctrine of ultra vires
479. (1) A transaction to which a society is a party is not invalid as
25 against another party to the transaction merely because of any
deficiency in the capacity of the society to enter into, or carry out, the
transaction unless the other party to the transaction has actual notice
of the deficiency.
(2) A society is authorized to carry out a transaction that would,
30 but for subsection (1), be invalid.
(3) The section does not prejudice a proceeding by a member of a
society to restrain the society from entering into or carrying out a
transaction that lies beyond the powers conferred on the society by the
friendly societies legislation, any other law or the society's rules.
35 (4) To the extent that sections 30 and 67 are inconsistent with this
section, those sections prevail.
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Abolition of doctrine of constructive notice
480. A person dealing with a society, or an agent of a society, is not
to be presumed to have notice of the society's rules and any document
registered by or lodged with the SSA in relation to the society.
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PART 15 -- TRANSITIONAL
Continuing societies
481. A continuing society continues in existence and is taken to be
registered under this Code as a society, and to be the same body on and
5 after the date on which this section comes into operation as before that
date.
Application for certificate of incorporation
482. (1) On application by a society to which section 481 applies
and on payment of the prescribed fee, the SSA must issue to the society
10 a certificate of incorporation stating that the society is incorporated
under this Code.
(2) The SSA need not issue a certificate of incorporation to a
society under subsection (1) unless the society --
(a) surrenders to the SSA its certificate of incorporation under
15 the previous law or a corresponding previous enactment; or
(b) satisfies the SSA that the certificate has been lost or
destroyed.
Benefit funds
483. (1) A benefit fund (within the meaning of the previous law) of
20 a continuing society existing under the previous law immediately before
the commencement of this section is deemed to be established under
this Code as a benefit fund (within the meaning of this Code) of the
continuing society.
(2) Subsection (1) does not apply to a benefit fund of a continuing
25 society from which only non-monetary benefits were provided before the
commencement of this section.
Rules
484. (1) The rules of a continuing society, in force immediately
before the commencement of this section, become its rules under this
30 Code.
(2) The rules have effect subject to this Code.
(3) If any rules of a continuing society do not comply with this
Code, the regulations or the standards, the society must, within 2 years
after the commencement of this section, take all necessary steps to
35 ensure that its rules do so comply.
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Subsidiaries
485. A continuing society that, immediately before the
commencement of this section, is the holder of a subsidiary because of
the lawful investment of its funds may continue to hold the subsidiary
5 and is taken to do so with the approval of the SSA.
Directors
486. (1) An existing term of office of a director of a continuing
society that is not due to end until 3 years or more after the
commencement of this section ends --
10 (a) immediately before the re-election of directors at the third
annual general meeting of the society after commencement
of this section; or
(b) at the end of that third annual general meeting.
(2) Subsection (1) does not, by implication, prevent the office of the
15 director becoming vacant at an earlier time.
Annual general meeting
487. If --
(a) the time within which a continuing society must hold its
annual general meeting under the previous law has been
20 extended under the law; and
(b) the extension of time is in force immediately before the
commencement of this section,
the extension of time is taken to have been allowed by the SSA under
section 301 (2).
25 Special resolutions
488. A special resolution passed by a continuing society under the
previous law, and not registered under the law before the
commencement of this section, may be registered by the SSA under this
Code.
30 Registers
489. A register kept by the SSA under the relevant previous law may
be incorporated in a register kept by the SSA under this Code.
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Accounts
489A. The directors of a society must prepare, or cause to be
prepared, accounts for the financial year last ended before the
commencement of this Code --
5 (a) as if the friendly societies legislation had not been enacted;
or
(b) in accordance with Part 6 of this Code and the standards.
Winding-up
490. If --
10 (a) under the previous law, a certificate has been issued for the
winding-up of a continuing society; and
(b) immediately before the commencement of this section, a
person has not been appointed liquidator of the society
because of the certificate,
15 the certificate is taken to have been issued by the SSA under
section 402 and the society may be wound-up accordingly.
Documents
491. A certificate or other document, relating to a continuing society,
issued or registered by, filed or lodged with or given to the SSA under
20 the previous law has effect as if it were a certificate or other document
issued or registered by, filed or lodged with or given to the SSA under
this Code.
Operation of Part 4B
492. (1) Despite the commencement of Part 4B, a failure to comply
25 with that Part during the period of 6 months after that commencement
is not a contravention of this Code.
(2) The SSA may, in writing given to a society, exempt the society
from compliance with Division 2 of Part 4B in respect of one or more
benefit funds for a further period ending not later than 12 months after
30 the commencement of that Division.
(3) An exemption under subsection (2) applies to the society and
anything done by any person in relation to the society and may be
given subject to such conditions as are specified in the notice.
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Interstate society carrying on business in this State
493. (1) An interstate society that prior to the commencement of
this section carried on business within the meaning of section 426 in
this State --
5 (a) must as soon as practicable notify the SSA that it is
carrying on business in this State;
(b) if the society proposes to continue carrying on business in
this State, must, within 6 months after the commencement
of this section (or such longer period as the SSA may allow)
10 apply to the SSA for registration under Part 11 as a foreign
society.
(2) An interstate society that notifies the SSA in accordance with
subsection (1) is deemed to be registered under Part 11 as a foreign
society for 6 months after the commencement of this section, or such
15 longer period as the SSA may allow.
(3) An interstate society that notifies the SSA and applies for
registration in accordance with subsection (1) is deemed to be registered
under Part 11 as a foreign society until so registered or until the SSA
gives written notice to the society that its application for registration
20 has been refused.
(4) In this section --
''interstate society'' means a body incorporated as a friendly
society in another State.
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SCHEDULE A
MISCELLANEOUS PROVISIONS RELATING TO
INTERPRETATION
PART 1 -- PRELIMINARY
5 Displacement of Schedule by contrary intention
1. The application of this Schedule may be displaced, wholly or
partly, by a contrary intention appearing in this Code.
PART 2 -- GENERAL
Code or Act includes statutory instruments under Code or Act
10 2. In this Code, a reference to this Code, the AFIC Code or an Act, or
a provision of this Code, the AFIC Code or an Act, includes a reference
to the statutory instruments made under, or in force under or for the
purposes of, those Codes, the Act or provision.
Code to be construed not to exceed legislative power of
15 Legislature
3. (1) This Code is to be construed as operating to the full extent of,
but so as not to exceed, the legislative power of the Legislature of this
State.
(2) If a provision of this Code, or the application of a provision of
20 this Code to a person, subject matter or circumstance, would, but for
this clause, be construed as being in excess of the legislative power of
the Legislature of this State --
(a) it is a valid provision to the extent to which it is not in
excess of the power; and
25 (b) the remainder of this Code, and the application of the
provision to other persons, subject matters or
circumstances, is not affected.
(3) This clause applies to this Code in addition to, and without
limiting the effect of, any provision of this Code.
30 Every section to be a substantive enactment
4. Every section of this Code has effect as a substantive enactment
without introductory words.
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Material that is, and is not, part of Code
5. (1) The heading to a Part, Division or Subdivision into which
this Code is divided is part of this Code.
(2) A Schedule to this Code is part of this Code.
5 (3) A heading to a section of this Code is not part of this Code.
(4) A footnote to this Code or to a provision of this Code, and an
endnote to this Code, are not part of this Code.
References to particular Acts
6. In this Code --
10 (a) an Act of this State may be cited --
(i) by its short title; or
(ii) by reference to the year in which it was passed and
its number; or
(iii) in another way sufficient in an Act of this State for
15 the citation of an Act;
(b) a Commonwealth Act may be cited --
(i) by its short title; or
(ii) in another way sufficient in a Commonwealth Act for
the citation of such an Act,
20 together with a reference to the Commonwealth;
(c) an Act of another State may be cited --
(i) by its short title; or
(ii) in another way sufficient in an Act of the State for
the citation of such an Act,
25 together with a reference to the State.
References taken to be included in Act or Code citation etc.
7. (1) A reference in this Code to an Act includes a reference to --
(a) the Act as originally enacted, and as amended from time to
time since its original enactment; and
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(b) if the Act has been repealed and re-enacted (with or
without modification) since the enactment of the reference,
the Act as re-enacted, and as amended from time to time
since its re-enactment.
5 (2) A reference in this Code to a provision of this Code or of an Act
includes a reference to --
(a) the provision as originally enacted, and as amended from
time to time since its original enactment; and
(b) if the provision has been omitted and re-enacted (with or
10 without modification) since the enactment of the reference,
the provision as re-enacted, and as amended from time to
time since its re-enactment.
(3) A reference in this Code to a provision of the AFIC Code
includes a reference to --
15 (a) the provision as in force from time to time; and
(b) if the provision has been omitted and re-enacted (with or
without modification) since the commencement of the
reference, the provision as re-enacted, and as amended from
time to time since its re-enactment.
20 (4) Subclauses (1) and (2) apply to a reference in this Code to a
law of the Commonwealth or another State as they apply to a reference
in this Code to an Act and to a provision of an Act.
References to commencement of AFIC Code
8. In this Code, a reference to the commencement of the AFIC Code,
25 or a provision of the AFIC Code, means the time at which the provision
of this Code containing the reference comes into operation or, in the
case of a provision of the AFIC Code, the time at which the provision
comes into operation, whichever is the later.
Interpretation best achieving Code's purpose
30 9. (1) In the interpretation of a provision of this Code, the
interpretation that will best achieve the purpose of this Code is to be
preferred to any other interpretation.
(2) Subclause (1) applies whether or not the purpose is expressly
stated in this Code.
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Use of extrinsic material in interpretation
10. (1) In this clause --
''extrinsic material'' means relevant material not forming part
of this Code, including, for example --
5 (a) material that is set out in the document containing
the text of this Code as printed by authority of the
Government Printer; and
(b) a report of a Royal Commission, Law Reform
Commission, commission or committee of inquiry, or a
10 similar body, that was laid before the Legislative
Assembly or Legislative Council of Western Australia
before the provision concerned was enacted; and
(c) a report of a committee of the Legislative Assembly or
Legislative Council of Western Australia that was
15 made to the Legislative Assembly or Legislative
Council of Western Australia before the provision was
enacted; and
(d) a treaty or other international agreement that is
mentioned in this Code; and
20 (e) an explanatory note or memorandum relating to the
Bill that contained the provision, or any relevant
document, that was laid before, or given to the
members of, the Legislative Assembly or Legislative
Council of Western Australia by the member bringing
25 in the Bill before the provision was enacted; and
(f) the speech made to the Legislative Assembly or
Legislative Council of Western Australia by the
member in moving a motion that the Bill be read a
second time; and
30 (g) material in the Votes and Proceedings of the
Legislative Assembly or Minutes of Proceedings of
Western Australia or in any official record of debates
in the Legislative Assembly or Legislative Council of
Western Australia; and
35 (h) a document that is declared by this Code to be a
relevant document for the purposes of this clause;
''ordinary meaning'' means the ordinary meaning conveyed by a
provision having regard to its context in this Code and to
the purpose of this Code.
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(2) Subject to subclause (3), in the interpretation of a provision of
this Code, consideration may be given to extrinsic material capable of
assisting in the interpretation --
(a) if the provision is ambiguous or obscure, to provide an
5 interpretation of it; or
(b) if the ordinary meaning of the provision leads to a result
that is manifestly absurd or is unreasonable, to provide an
interpretation that avoids such a result; or
(c) in any other case, to confirm the interpretation conveyed by
10 the ordinary meaning of the provision.
(3) In determining whether consideration should be given to
extrinsic material, and in determining the weight to be given to
extrinsic material, regard is to be had to --
(a) the desirability of a provision being interpreted as having
15 its ordinary meaning; and
(b) the undesirability of prolonging proceedings without
compensating advantage; and
(c) other relevant matters.
Effect of change of drafting practice and use of examples
20 11. (1) If --
(a) a provision of this Code expresses an idea in particular
words; and
(b) a provision enacted later appears to express the same idea
in different words for the purpose of implementing a
25 different legislative drafting practice, including, for
example, the use of a clearer or simpler style, the ideas
must not be taken to be different merely because different
words are used.
(2) If this Code includes an example of the operation of a
30 provision --
(a) the example is not exhaustive; and
(b) the example does not limit, but may extend, the meaning of
the provision; and
(c) the example and the provision are to be read in the context
35 of each other and the other provisions of this Code, but, if
the example and the provision so read are inconsistent, the
provision prevails.
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Compliance with forms
12. (1) If a form is prescribed or approved by or for the purpose of
this Code, strict compliance with the form is not necessary and
substantial compliance is sufficient.
5 (2) If a form prescribed or approved by or for the purpose of this
Code requires --
(a) the form to be completed in a specified way; or
(b) specified information or documents to be included in,
attached to or given with the form; or
10 (c) the form, or information or documents included in, attached
to or given with the form, to be verified in a specified way,
the form is not properly completed unless the requirement is complied
with.
PART 3 -- TERMS AND REFERENCES
15 Definitions
13. (1) In this Code --
''Act'' means any Act or Ordinance passed by the Parliament of
Western Australia, or by any Council previously having
authority or power to pass laws in Western Australia, such
20 Act or Ordinance having been assented to by or on behalf of
Her Majesty;
''adult'' means an individual who is 18 or more;
''affidavit'', in relation to a person allowed by law to affirm,
declare or promise, includes affirmation, declaration and
25 promise;
''amend'' includes --
(a) omit or omit and substitute; and
(b) add to; and
(c) alter or vary; and
30 (d) amend by implication;
''appoint'' includes re-appoint;
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''Australia'' means the Commonwealth of Australia but, when
used in a geographical sense, does not include an external
Territory;
''business day'' means a day that is not --
5 (a) a Saturday or Sunday; or
(b) a public holiday, special holiday or bank holiday in
the place in which any relevant act is to be or may be
done;
''calendar month'' means a period starting at the beginning of
10 any day of one of the 12 named months and ending --
(a) immediately before the beginning of the
corresponding day of the next named month; or
(b) if there is no such corresponding day, at the end of
the next named month;
15 ''calendar year'' means a period of 12 months beginning on
1 January;
''commencement'', in relation to this Code or an Act or a
provision of this Code or an Act, means the time at which
this Code, the Act or provision comes into operation;
20 ''Commonwealth'' means the Commonwealth of Australia but,
when used in a geographical sense, does not include an
external Territory;
''confer'', in relation to a function, includes impose;
''contravene'' includes fail to comply with;
25 ''country'' includes --
(a) a federation; or
(b) a state, province or other part of a federation;
''date of assent'', in relation to an Act, means the day on which
the Act receives the Royal Assent;
30 ''definition'' means a provision of this Code or the AFIC Code
(however expressed) that --
(a) gives a meaning to a word or expression; or
(b) limits or extends the meaning of a word or
expression;
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''document'' includes --
(a) any paper or other material on which there is writing;
and
(b) any paper or other material on which there are
5 marks, figures, symbols or perforations having a
meaning for a person qualified to interpret them; and
(c) any disc, tape or other article or any material from
which sounds, images, writings or messages are
capable of being reproduced (with or without the aid
10 of another article or device);
''estate'' includes easement, charge, right, title, claim, demand,
lien and encumbrance, whether at law or in equity;
''expire'' includes lapse or otherwise cease to have effect;
''external Territory'' means a Territory, other than an internal
15 Territory, for the government of which as a Territory
provision is made by a Commonwealth Act;
''fail'' includes refuse;
''financial year'' means a period of 12 months beginning on
1 July;
20 ''foreign country'' means a country (whether or not an
independent sovereign State) outside Australia and the
external Territories;
''function'' includes duty;
''Gazette'' means the Government Gazette of this State;
25 ''Gazette notice'' means notice published in the Gazette;
''gazetted'' means published in the Gazette;
''Government Printer'' means the Government Printer for this
State, and includes any other person authorized by the
Government of this State to print an Act or instrument;
30 ''indictment'' includes information, inquisition and presentment;
''individual'' means a natural person;
''insert'', in relation to a provision of this Code or the AFIC Code,
includes substitute;
''instrument'' includes a statutory instrument;
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''interest'', in relation to land or other property, means --
(a) a legal or equitable estate in the land or other
property; or
(b) a right, power or privilege over, or in relation to, the
5 land or other property;
''internal Territory'' means the Australian Capital Territory,
the Jervis Bay Territory or the Northern Territory;
''Jervis Bay Territory'' means the Territory mentioned in the
Jervis Bay Territory Acceptance Act 1915 of the
10 Commonwealth;
''land'' includes messuages, tenements and hereditaments,
corporeal or incorporeal, of any tenure or description, and
whatever may be the interest in the land;
''liability'' means any liability or obligation (whether liquidated
15 or unliquidated, certain or contingent, or accrued or
accruing);
''make'' includes issue and grant;
''Minister'' has the meaning given by clause 18;
''minor'' means an individual who is under 18;
20 ''modification'' includes addition, omission and substitution;
''month'' means a calendar month;
''named month'' means one of the 12 months of the year;
''Northern Territory'' means the Northern Territory of
Australia;
25 ''number'' means --
(a) a number expressed in figures or words; or
(b) a letter; or
(c) a combination of a number so expressed and a letter;
''oath'', in relation to a person allowed by law to affirm, declare
30 or promise, includes affirmation, declaration and promise;
''office'' includes position;
''omit'', in relation to a provision of an Act, includes repeal;
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''party'' includes an individual and a body politic or corporate;
''penalty'' includes forfeiture and punishment;
''person'' includes an individual and a body politic or corporate;
''power'' includes authority;
5 ''prescribed'' means prescribed by, or by regulations or
standards made or in force for the purposes of or under,
this Code;
''printed'' includes typewritten, lithographed or reproduced by
any mechanical means;
10 ''proceeding'' means a legal or other action or proceeding;
''property'' means any legal or equitable estate or interest
(whether present or future, vested or contingent, or tangible
or intangible) in real or personal property of any description
(including money), and includes things in action;
15 ''provision'', in relation to this Code, the AFIC Code or an Act,
means words or other matter that form or forms part of this
Code, the AFIC Code or the Act, and includes --
(a) a Chapter, Part, Division, Subdivision, section,
subsection, paragraph, sub-paragraph, sub-
20 subparagraph or Schedule of or to this Code, the
AFIC Code or the Act; and
(b) a section, clause, subclause, item, column, table or
form of or in a Schedule to this Code, the AFIC Code,
or the Act; and
25 (c) the long title and any preamble to the Act;
''purpose'', in relation to an Act, includes object;
''record'' includes information stored or recorded by means of a
computer;
''repeal'' includes --
30 (a) revoke or rescind; and
(b) repeal by implication; and
(c) abrogate or limit the effect of this Code or the
instrument concerned; and
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(d) exclude from, or include in, the application of this
Code or the instrument concerned any person, subject
matter or circumstance;
''sign'' includes the affixing of a seal and the making of a mark;
5 ''statutory declaration'' means a declaration made under an
Act, or under a Commonwealth Act or an Act of another
State, that authorizes a declaration to be made otherwise
than in the course of a judicial proceeding;
''statutory instrument'' means an instrument (including a
10 regulation, standard or rule) made or in force under or for
the purposes of this Code or the AFIC Code, and includes
an instrument made or in force under any such instrument;
''swear'', in relation to a person allowed by law to affirm, declare
or promise, includes affirm, declare and promise;
15 ''word'' includes any symbol, figure or drawing;
''writing'' includes any mode of representing or reproducing
words in a visible form.
(2) In a statutory instrument --
''the Code'' means the Code under, or for the purposes of, which
20 the instrument is made or in force.
Provisions relating to defined terms and gender and number
14. (1) If this Code defines a word or expression, other parts of
speech and grammatical forms of the word or expression have
corresponding meanings.
25 (2) Definitions in or applicable to this Code apply except so far as
the context or subject matter otherwise indicates or requires.
(3) In this Code, words indicating a gender include each other
gender.
(4) In this Code --
30 (a) words in the singular include the plural; and
(b) words in the plural include the singular.
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Meaning of ''may'' and ''must''
15. (1) In this Code, the word ''may'', or a similar word or
expression, used in relation to a power indicates that the power may be
exercised or not exercised, at discretion.
5 (2) In this Code, the word ''must'', or a similar word or expression,
used in relation to a power indicates that the power is required to be
exercised.
(3) This clause has effect despite any rule of construction to the
contrary.
10 Words and expressions used in statutory instruments
16. (1) Words and expressions used in a statutory instrument made
or in force under or for the purposes of this Code have the same
meanings as they have, from time to time, in this Code, or relevant
provisions of this Code.
15 (2) This clause has effect in relation to an instrument except so far
as the contrary intention appears in the instrument.
Effect of express references to bodies corporate and individuals
17. In this Code, a reference to a person generally (whether the
expression ''person'', ''party'', ''someone'', ''anyone'', ''no-one'', ''one'',
20 ''another'' or ''whoever'' or another expression is used) --
(a) does not exclude a reference to a body corporate or an
individual merely because elsewhere in this Code there is
particular reference to a body corporate (however
expressed); and
25 (b) does not exclude a reference to an individual or a body
corporate merely because elsewhere in this Code there is
particular reference to an individual (however expressed).
References to Minister
18. (1) In this Code --
30 (a) a reference to a Minister is a reference to a Minister of the
Crown of this State; and
(b) a reference to a particular Minister by title, or to ''the
Minister'' without specifying a particular Minister by title,
includes a reference to another Minister, or a member of
35 the Executive Council of this State, who is acting for or on
behalf of the Minister.
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(2) In a provision of this Code, a reference to ''the Minister''
without specifying a particular Minister by title is a reference to --
(a) the Minister of this State administering the provision; or
(b) if, for the time being, different Ministers of this State
5 administer the provision in relation to different matters --
(i) if only one Minister of this State administers the
provision in relation to the relevant matter, the
Minister; or
(ii) if 2 or more Ministers of this State administer the
10 provision in relation to the relevant matter, any one
of the Ministers; or
(c) if paragraph (b) does not apply and, for the time being, 2 or
more Ministers administer the provision, any one of the
Ministers.
15 (3) To allay any doubt, it is declared that if --
(a) a provision of this Code is administered by 2 or more
Ministers of this State; and
(b) the provision requires or permits anything to be done in
relation to any of the Ministers,
20 the provision does not require or permit it to be done in a particular
case by or in relation to more than one of the Ministers.
Production of records kept in computers etc.
19. If a person who keeps a record of information by means of a
mechanical, electronic or other device is required by or under this
25 Code --
(a) to produce the information or a document containing the
information to a court, tribunal or person; or
(b) to make a document containing the information available
for inspection by a court, tribunal or person,
30 then, unless the court, tribunal or person otherwise directs --
(c) the requirement obliges the person to produce or make
available for inspection, as the case may be, a document
that reproduces the information in a form capable of being
understood by the court, tribunal or person; and
35 (d) the production to the court, tribunal or person of the
document in that form complies with the requirement.
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Application of offence provisions to bodies corporate
20. (1) A provision of this Code relating to offences applies to
bodies corporate as well as to individuals.
(2) If under this Code, a forfeiture or penalty is payable to a party
5 aggrieved, it is payable to a body corporate if the body corporate is the
party aggrieved.
References to this State to be implied
21. In this Code --
(a) a reference to an officer, office or statutory body is a
10 reference to such an officer, office or statutory body in and
for this State; and
(b) a reference to a locality, jurisdiction or other matter or
thing is a reference to such a locality, jurisdiction or other
matter or thing in and of this State.
15 References to officers and holders of offices
22. In this Code, a reference to a particular officer, or to the holder of
a particular office, includes a reference to the person for the time being
occupying or acting in the office concerned.
Reference to certain provisions of this Code
20 23. If a provision of this Code refers --
(a) to a Part, section or Schedule by a number and without
reference to this Code, the reference is a reference to the
Part, section or Schedule, designated by the number, of or
to this Code; or
25 (b) to a Schedule without reference to it by a number and
without reference to this Code, the reference, if there is
only one Schedule to this Code, is a reference to the
Schedule; or
(c) to a Division, Subdivision, subsection, paragraph, sub-
30 paragraph, sub-subparagraph, clause, subclause, item,
column, table or form by a number and without reference to
this Code, the reference is a reference to --
(i) the Division, designated by the number, of the Part in
which the reference occurs; and
35 (ii) the Subdivision, designated by the number, of the
Division in which the reference occurs; and
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(iii) the subsection, designated by the number, of the
section in which the reference occurs; and
(iv) the paragraph, designated by the number, of the
section, subsection, Schedule or other provision in
5 which the reference occurs; and
(v) the paragraph, designated by the number, of the
clause, subclause, item, column, table or form of or in
the Schedule in which the reference occurs; and
(vi) the sub-paragraph, designated by the number, of the
10 paragraph in which the reference occurs; and
(vii) the sub-subparagraph, designated by the number, of
the subparagraph in which the reference occurs; and
(viii) the section, clause, subclause, item, column, table or
form, designated by the number, of or in the Schedule
15 in which the reference occurs,
as the case requires.
Words that form part of provision
24. The word ''and'', ''or'' or ''but'', or a similar word, at the end of a
paragraph, subparagraph or sub-subparagraph or another provision of
20 this Code forms part of the provision concerned.
Reference to provisions of a Code or an Act is inclusive
25. In this Code, a reference to a portion of this Code or the AFIC
Code or an Act includes --
(a) a reference to the Chapter, Part, Division, Subdivision,
25 section, subsection or other provision of this Code, the
AFIC Code or the Act referred to that forms the beginning
of the portion; and
(b) a reference to the Chapter, Part, Division, Subdivision,
section, subsection or other provision of this Code, the
30 AFIC Code or the Act referred to that forms the end of the
portion.
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PART 4 -- FUNCTIONS AND POWERS
Performance of statutory functions
26. (1) If this Code confers a function or power on a person or body,
the function may be performed, or the power may be exercised, from
5 time to time as occasion requires.
(2) If this Code confers a function or power on a particular officer
or the holder of a particular office, the function may be performed, or
the power may be exercised, by the person for the time being occupying
or acting in the office concerned.
10 (3) If this Code confers a function or power on a body (whether or
not incorporated), the performance of the function, or the exercise of the
power, is not affected merely because of vacancies in the membership of
the body.
Power to make instrument or decision includes power to amend
15 or repeal
27. Except as otherwise provided in this Code, if this Code authorizes
or requires the making of an instrument or decision --
(a) the power includes power to amend or repeal the
instrument or decision; and
20 (b) the power to amend or repeal the instrument or decision is
exercisable in the same way, and subject to the same
conditions, as the power to make the instrument or
decision.
Matters for which statutory instruments may make provision
25 28. (1) If this Code authorizes or requires the making of a statutory
instrument in relation to a matter, a statutory instrument made under
this Code may make provision for the matter by applying, adopting or
incorporating (with or without modification) the provisions of --
(a) an Act or statutory instrument; or
30 (b) another document (whether of the same or a different kind),
as in force at a particular time or as in force from time to time.
(2) If a statutory instrument applies, adopts or incorporates the
provisions of a document, the statutory instrument applies, adopts or
incorporates the provisions as in force from time to time, unless the
35 statutory instrument otherwise expressly provides.
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(3) A statutory instrument may --
(a) apply generally throughout this State or be limited in its
application to a particular part of this State; or
(b) apply generally to all persons, matters or things or be
5 limited in its application to --
(i) particular persons, matters or things; or
(ii) particular classes of persons, matters or things; or
(c) otherwise apply generally or be limited in its application by
reference to specified exceptions or factors.
10 (4) A statutory instrument may --
(a) apply differently according to different specified factors; or
(b) otherwise make different provision in relation to --
(i) different persons, matters or things; or
(ii) different classes of persons, matters or things.
15 (5) A statutory instrument may authorize a matter or thing to be
from time to time determined, applied or regulated by a specified
person or body.
(6) If this Code authorizes or requires a matter to be regulated by
statutory instrument, the power may be exercised by prohibiting by
20 statutory instrument the matter or any aspect of the matter.
(7) If this Code authorizes or requires provision to be made with
respect to a matter by statutory instrument, a statutory instrument
made under this Code may make provision with respect to a particular
aspect of the matter despite the fact that provision is made by this
25 Code in relation to another aspect of the matter or in relation to
another matter.
(8) A statutory instrument made or in force under this Code may
provide for the review of, or a right of appeal against, a decision made
under the statutory instrument or this Code and may, for that purpose,
30 confer jurisdiction on any court, tribunal, person or body.
(9) A statutory instrument may require a form prescribed by or
under the statutory instrument, or information or documents included
in, attached to or given with the form, to be verified by statutory
declaration.
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Presumption of validity and power to make
29. (1) All conditions and preliminary steps required for the
making of a statutory instrument are presumed to have been satisfied
and performed in the absence of evidence to the contrary.
5 (2) A statutory instrument is taken to be made under all powers
under which it may be made, even though it purports to be made under
this Code or a particular provision of this Code.
Appointments may be made by name or office
30. (1) If this Code authorizes or requires a person or body --
10 (a) to appoint a person to an office; or
(b) to appoint a person or body to exercise a power; or
(c) to appoint a person or body to do another thing,
the person or body may make the appointment by --
(d) appointing a person or body by name; or
15 (e) appointing a particular officer, or the holder of a particular
office, by reference to the title of the office concerned.
(2) An appointment of a particular officer, or the holder of a
particular office, is taken to be the appointment of the person for the
time being occupying or acting in the office concerned.
20 Acting appointments
31. (1) If this Code authorizes a person or body to appoint a person
to act in an office, the person or body may, in accordance with this
Code, appoint --
(a) a person by name; or
25 (b) a particular officer, or the holder of a particular office, by
reference to the title of the office concerned,
to act in the office.
(2) The appointment may be expressed to have effect only in the
circumstances specified in the instrument of appointment.
30 (3) The appointer may --
(a) determine the terms and conditions of the appointment,
including remuneration and allowances; and
(b) terminate the appointment at any time.
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(4) The appointment, or the termination of the appointment, must
be in, or evidenced by, writing signed by the appointer.
(5) The appointee must not act for more than one year during a
vacancy in the office.
5 (6) If the appointee is acting in the office otherwise than because
of a vacancy in the office and the office becomes vacant, then, subject to
subclause (2), the appointee may continue to act until --
(a) the appointer otherwise directs; or
(b) the vacancy is filled; or
10 (c) the end of a year from the day of the vacancy,
whichever happens first.
(7) The appointment ceases to have effect if the appointee resigns
by writing signed and delivered to the appointer.
(8) While the appointee is acting in the office --
15 (a) the appointee has all the powers and functions of the holder
of the office; and
(b) this Code and other laws apply to the appointee as if the
appointee were the holder of the office.
(9) Anything done by or in relation to a person purporting to act in
20 the office is not invalid merely because --
(a) the occasion for the appointment had not arisen; or
(b) the appointment had ceased to have effect; or
(c) the occasion for the person to act had not arisen or had
ceased.
25 (10) If this Code authorizes the appointer to appoint a person to
act during a vacancy in the office, an appointment to act in the office
may be made by the appointer whether or not an appointment has
previously been made to the office.
Powers of appointment imply certain incidental powers
30 32. (1) If this Code authorizes or requires a person or body to
appoint a person to an office --
(a) the power may be exercised from time to time as occasion
requires; and
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(b) the power includes --
(i) power to remove or suspend, at any time, a person
appointed to the office; and
(ii) power to appoint another person to act in the office if
5 a person appointed to the office is removed or
suspended; and
(iii) power to reinstate or reappoint a person removed or
suspended; and
(iv) power to appoint a person to act in the office if it is
10 vacant (whether or not the office has ever been filled);
and
(v) power to appoint a person to act in the office if the
person appointed to the office is absent or is unable to
discharge the functions of the office (whether because
15 of illness or otherwise).
(2) The power to remove or suspend a person under
subclause (1) (b) may be exercised even if this Code provides that the
holder of the office to which the person was appointed is to hold office
for a specified period.
20 (3) The power to make an appointment under subclause (1) (b)
may be exercised from time to time as occasion requires.
(4) An appointment under subclause (1) (b) may be expressed to
have effect only in the circumstances specified in the instrument of
appointment.
25 Delegation of powers
33. (1) If this Code authorizes a person or body to delegate a
power, the person or body may, in accordance with this Code, delegate
the power to --
(a) a person or body by name; or
30 (b) a particular officer, or the holder of a particular office, by
reference to the title of the office concerned.
(2) The delegation may be --
(a) general or limited; and
(b) made from time to time; and
35 (c) revoked, wholly or partly, by the delegator.
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(3) The delegation or a revocation of the delegation, must be in, or
evidenced by, writing signed by the delegator or, if the delegator is a
body, by a person authorized by the body for the purpose.
(4) A delegated power may be exercised only in accordance with
5 any conditions to which the delegation is subject.
(5) The delegate may, in the exercise of a delegated power, do
anything that is incidental to the delegated power.
(6) A delegated power that purports to have been exercised by the
delegate is taken to have been duly exercised by the delegate unless the
10 contrary is proved.
(7) A delegated power that is duly exercised by the delegate is
taken to have been exercised by the delegator.
(8) If, when exercised by the delegator, a power is, under this
Code, dependent on the delegator's opinion, belief or state of mind in
15 relation to a matter, the power when exercised by the delegate, is
dependent on the delegate's opinion, belief or state of mind in relation
to the matter.
(9) If a power is delegated to a particular officer or the holder of a
particular office --
20 (a) the delegation does not cease to have effect merely because
the person who was the particular officer or the holder of
the particular office when the power was delegated ceases
to be the officer or the holder of the office; and
(b) the power may be exercised by the person for the time
25 being occupying or acting in the office concerned.
(10) A power that has been delegated may, despite the delegation,
be exercised by the delegator.
(11) Subject to subclause (12), this clause applies to a sub-
delegation of a power in the same way as it applies to a delegation of a
30 power.
(12) If this Code authorizes the delegation of a power, the power
may be sub-delegated only if this Code expressly authorizes the power
to be sub-delegated.
Exercise of power between enactment and commencement
35 34. (1) If a provision of this Code (the ''empowering provision'')
that does not commence on its enactment would, had it commenced,
confer a power --
(a) to make an appointment; or
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(b) to make a statutory instrument of a legislative or
administrative character; or
(c) to do another thing,
then --
5 (d) the power may be exercised; and
(e) anything may be done for the purpose of enabling the
exercise of the power or of bringing the appointment,
instrument or other thing into effect,
before the empowering provision commences.
10 (2) If a provision of an Act (the ''empowering provision'') that
does not commence on its enactment would, had it commenced, amend a
provision of this Code so that it would confer a power --
(a) to make an appointment; or
(b) to make a statutory instrument of a legislative or
15 administrative character; or
(c) to do another thing,
then --
(d) the power may be exercised; and
(e) anything may be done for the purpose of enabling the
20 exercise of the power or of bringing the appointment,
instrument or other thing into effect,
before the empowering provision commences.
(3) If --
(a) this Code has commenced and confers a power to make a
25 statutory instrument (the ''basic instrument-making
power''); and
(b) a provision of an Act that does not commence on its
enactment would, had it commenced, amend this Code so as
to confer additional power to make a statutory instrument
30 (the ''additional instrument-making power''),
then --
(c) the basic instrument-making power and the additional
instrument-making power may be exercised by making a
single instrument; and
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(d) any provision of the instrument that required an exercise of
the additional instrument-making power is to be treated as
made under subclause (2).
(4) If an instrument, or a provision of an instrument, is made
5 under subclause (1) or (2) that is necessary for the purpose of --
(a) enabling the exercise of a power mentioned in the
subclause; or
(b) bringing an appointment, instrument or other thing made
or done under such a power into effect,
10 the instrument or provision takes effect --
(c) on the making of the instrument; or
(d) on such later day (if any) on which, or at such later time (if
any) at which, the instrument or provision is expressed to
take effect.
15 (5) If --
(a) an appointment is made under subclause (1) or (2); or
(b) an instrument, or provision of an instrument, made under
subclause (1) or (2) is not necessary for a purpose
mentioned in subclause (4),
20 the appointment, instrument or provision takes effect --
(c) on the commencement of the relevant empowering
provision; or
(d) on such later day (if any) on which, or at such later time (if
any) at which, the appointment, instrument or provision is
25 expressed to take effect.
(6) Anything done under subclause (1) or (2) does not confer a
right, or impose a liability, on a person before the relevant empowering
provision commences.
(7) After the enactment of a provision mentioned in subclause (2)
30 but before the provision's commencement, this clause applies as if the
references in subclauses (2) and (5) to the commencement of the
empowering provision were references to the commencement of the
provision mentioned in subclause (2) as amended by the empowering
provision.
35 (8) In the application of this clause to a statutory instrument, a
reference to the enactment of the instrument is a reference to the
making of the instrument.
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PART 5 -- DISTANCE, TIME AND AGE
Matters relating to distance, time and age
35. (1) In the measurement of distance for the purposes of this
Code, the distance is to be measured along the shortest road ordinarily
5 used for travelling.
(2) If a period beginning on a given day, act or event is provided or
allowed for a purpose by this Code, the period is to be calculated by
excluding the day, or the day of the act or event, and --
(a) if the period is expressed to be a specified number of clear
10 days or at least a specified number of days, by excluding
the day on which the purpose is to be fulfilled; and
(b) in any other case, by including the day on which the
purpose is to be fulfilled.
(3) If the last day of a period provided or allowed by this Code for
15 doing anything is not a business day in the place in which the thing is
to be or may be done, the thing may be done on the next business day
in the place.
(4) If the last day of a period provided or allowed by this Code for
the filing or registration of a document is a day on which the office is
20 closed where the filing or registration is to be or may be done, the
document may be filed or registered at the office on the next day that
the office is open.
(5) If no time is provided or allowed for doing anything, the thing
is to be done as soon as possible, and as often as the prescribed occasion
25 happens.
(6) If, in this Code, there is a reference to time, the reference is, in
relation to the doing of anything in a State, a reference to the legal
time in the State.
(7) For the purposes of this Code, a person attains an age in years
30 at the beginning of the person's birthday for the age.
PART 6 -- SERVICE OF DOCUMENTS
Service of documents
36. (1) If this Code requires or permits a document to be served on
a person (whether the expression ''deliver'', ''give'', ''notify'', ''send'' or
35 ''serve'' or another expression is used), the document may be served --
(a) on an individual --
(i) by delivering it to the person personally; or
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(ii) by leaving it at, or by sending it by post, telex,
facsimile or similar facility to, the address of the
place of residence or business of the person last
known to the person serving the document; or
5 (b) on a body corporate --
(i) by leaving it at the registered office of the body
corporate with an officer of the body corporate; or
(ii) by sending it by post, telex, facsimile or similar
facility to its registered office.
10 (2) Nothing in subclause (1) --
(a) affects the operation of another law that authorizes the
service of a document otherwise than as provided in the
subclause; or
(b) affects the power of a court or tribunal to authorize service
15 of a document otherwise than as provided in the subclause.
Meaning of service by post
37. (1) If this Code requires or permits a document to be served by
post (whether the expression ''deliver'', ''give'', ''notify'', ''send'' or ''serve''
or another expression is used), service --
20 (a) may be effected by properly addressing, prepaying and
posting the document as a letter; and
(b) is taken to have been effected at the time at which the
letter would be delivered in the ordinary course of post,
unless the contrary is proved.
25 (2) If this Code requires or permits a document to be served by a
particular postal method (whether the expression ''deliver'', ''give'',
''notify'', ''send'' or ''serve'' or another expression is used), the
requirement or permission is taken to be satisfied if the document is
posted by that method or, if that method is not available, by the
30 equivalent, or nearest equivalent, method provided for the time being
by Australia Post.
Time of provision of Code ceasing to have effect
38. If a provision of this Code is expressed --
(a) to expire on a specified day; or
35 (b) to remain or continue in force, or otherwise have effect,
until a specified day,
the provision has effect until the last moment of the specified day.
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PART 7 -- EFFECT OF REPEAL, AMENDMENT OR
EXPIRATION
Repealed or amended provision of Code not revived
39. If a provision of this Code is repealed or amended by an Act or a
5 provision of an Act, the provision is not revived merely because the Act
or the provision of the Act --
(a) is later repealed or amended; or
(b) later expires.
Saving of operation of repealed provision of Code
10 40. (1) The repeal, amendment or expiry of a provision of this Code
does not --
(a) revive anything not in force or existing at the time the
repeal, amendment or expiry takes effect; or
(b) affect the previous operation of the provision or anything
15 suffered, done or begun under the provision; or
(c) affect a right, privilege or liability acquired, accrued or
incurred under the provision; or
(d) affect a penalty incurred in relation to an offence arising
under the provision; or
20 (e) affect an investigation, proceeding or remedy in relation to
such a right, privilege, liability or penalty.
(2) Any such penalty may be imposed and enforced, and any such
investigation, proceeding or remedy may be begun, continued or
enforced, as if the provision had not been repealed or amended or had
25 not expired.
Continuance of repealed provisions
41. If an Act repeals some or all of the provisions of this Code and
enacts new provisions in substitution for the repealed provisions, the
repealed provisions continue in force until the new provisions
30 commence.
Code and amending Acts to be read as one
42. This Code and all Acts amending this Code are to be read as one.
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PART 8 -- OFFENCES UNDER CODE
Penalty at end of provision
43. In this Code, a penalty specified at the end of --
(a) a section (whether or not the section is divided into
5 subsections); or
(b) a subsection (but not at the end of a section); or
(c) a section or subsection and expressed in such a way as to
indicate that it applies only to part of the section or
subsection,
10 indicates that an offence mentioned in the section, subsection or part is
punishable on conviction or, if no offence is mentioned, a contravention
of the section, subsection or part constitutes an offence against the
provision that is punishable on conviction --
(d) if a minimum as well as a maximum penalty is specified, by
15 a penalty not less than the minimum and not more than
the maximum; or
(e) in any other case, by a penalty not more than the specified
penalty.
Penalty other than at end of provision
20 44. (1) In this Code, a penalty specified for an offence, or a
contravention of a provision, indicates that the offence is punishable on
conviction, or the contravention constitutes an offence against the
provision that is punishable on conviction --
(a) if a minimum as well as a maximum penalty is specified, by
25 a penalty not less than the minimum and not more than
the maximum; or
(b) in any other case, by a penalty not more than the specified
penalty.
(2) This clause does not apply to a penalty to which clause 43
30 applies.
Indictable offences and summary offences
45. (1) An offence against this Code that is not punishable by
imprisonment is punishable summarily.
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(2) An offence against this Code that is punishable by
imprisonment is, subject to subclause (3), punishable on indictment.
(3) If --
(a) a proceeding for an offence against this Code that is
5 punishable by imprisonment is brought in a court of
summary jurisdiction; and
(b) the prosecutor requests the court to hear and determine the
proceeding,
the offence is punishable summarily and the court must hear and
10 determine the proceeding.
(4) A court of summary jurisdiction must not --
(a) impose, in relation to a single offence against this Code, a
period of imprisonment of more than 2 years; or
(b) impose, in relation to offences against this Code, cumulative
15 periods of imprisonment that are, in total, more than 5
years.
(5) Nothing in this clause renders a person liable to be punished
more than once in relation to the same offence.
Double jeopardy
20 46. If an act or omission constitutes an offence --
(a) under this Code; or
(b) under another law of this State or a law of another State,
and the offender has been punished in relation to the offence under a
law mentioned in paragraph (b), the offender is not liable to be
25 punished in relation to the offence under this Code.
Aiding and abetting, attempts etc.
47. (1) A person who aids, abets, counsels or procures, or by act or
omission is in any way directly or indirectly concerned in or a party to,
the commission of an offence against this Code is taken to have
30 committed that offence and is liable to the penalty for the offence.
(2) A person who attempts to commit an offence against this Code
commits an offence and is punishable as if the attempted offence had
been committed.
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PART 9 -- INSTRUMENTS UNDER CODE
Schedule applies to statutory instruments
48. (1) This Schedule applies to a statutory instrument, and to
things that may be done or are required to be done under a statutory
5 instrument, in the same way as it applies to this Code, and things that
may be done or are required to be done under this Code, except so far
as the context or subject matter indicates or requires.
(2) The fact that a provision of this Schedule refers to this Code
and not also to a statutory instrument does not, by itself, indicate that
10 the provision is intended to apply only to that Code.
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NOTES
COMPARATIVE TABLE OF PROVISIONS OF FRIENDLY
SOCIETIES CODE AND FINANCIAL INSTITUTIONS CODE
Section of Friendly Societies Section of Financial Institutions
5 Code Code
1 1
2 2
3 3
4 4
10 5 5
6 6
7 7
8 8
9
9 10
15 10 11
11 12
280 13
12
14
Schedule A, cl. 1 15
20 Schedule A, cl. 2 16
Schedule A, cl. 3 17
Schedule A, cl. 4 18
Schedule A, cl. 5 19
Schedule A, cl. 6 20
25 Schedule A, cl. 7 21
Schedule A, cl. 8
Schedule A, cl. 9 22
Schedule A, cl. 10 23
Schedule A, cl. 11 24
30 Schedule A, cl. 12 25
26
Schedule A, cl. 13 27
Schedule A, cl. 14 28
Schedule A, cl. 15 29
Schedule A, cl. 16 30
35 Schedule A, cl. 17 31
Schedule A, cl. 18 32
Schedule A, cl. 19 33
Schedule A, cl. 20 34
Schedule A, cl. 21 35
40 Schedule A, cl. 22 36
Schedule A, cl. 23 37
Schedule A, cl. 24 38
Schedule A, cl. 25 39
Schedule A, cl. 26 40
45 Schedule A, cl. 27 41
Schedule A, cl. 28 42
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Section of Friendly Societies Section of Financial Institutions
Code Code
Schedule A, cl. 29 43
Schedule A, cl. 30 44
Schedule A, cl. 31 45
Schedule A, cl. 32 46
5 Schedule A, cl. 33 47
Schedule A, cl. 34 48
Schedule A, cl. 35 49
Schedule A, cl. 36 50
Schedule A, cl. 37 51
10 Schedule A, cl. 38 52
Schedule A, cl. 39 53
Schedule A, cl. 40 54
Schedule A, cl. 41 55
Schedule A, cl. 42 56
15 Schedule A, cl. 43 57
Schedule A, cl. 44 58
Schedule A, cl. 45 59
Schedule A, cl. 46 60
Schedule A, cl. 47 61
20 Schedule A, cl. 48 62
13
14
15
16
25 17 63
64
18 64A
19 65
20 65A
21 65B
30 22 66
23 67
24 68
25 69
26 70
35 27 71
28 72
29 73
30 119
74
31 75
40 32 76
33 77
34 78
35 79
36 80
45 37 81
38 82
39 83
40 84
41 85
376
Friendly Societies (Western Australia)
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Section of Friendly Societies Section of Financial Institutions
Code Code
42 86
43 87
44 88
45 89
5 46 90
47 91
48 92
49 93
50 94
10 51 95
52 96
97
98
98A
99
100
53 101
102 -- 105D
54 106
55 107
108
109
15 56 110
57
58
111
112
113
59 114
60 115
20 61 116
62 117
63 118
64
65
25 66
30 119
67 120
68 121
69 122
123
30 70 124
71 125
72 126
73 127
74 128
35 75 129
76
77
78
79 402
377
Friendly Societies (Western Australia)
Bill 1998
Section of Friendly Societies Section of Financial Institutions
Code Code
130
80 131
81 132
82 133
83 134
5 84 135
85 136
86 137
138
138A
87 139
88 140
10 89 141
90 144
91
92 145
93 146
15 94 218
95 147
96 -- 218
219 148
220 149
20 221 150
151
222 152
223 153
224 154
225 155
25 226 156
157 -- 162
227 163
228 164
229 165
230 166
30 231 167
232 168
233 169
234 170
235 171
35 236 172
237 173
238 174
239 175
240 176
40 241 177
242 178
243 179
244 180
245 181
45 246 182
183
378
Friendly Societies (Western Australia)
Bill 1998
Section of Friendly Societies Section of Financial Institutions
Code Code
247 184
248 185
249 186
250 187
5 251 188
252 189
253 190
254 191
255 192
10 256 193
257 194
258 195
259 196
260 197
15 261 198
262 199
200
209
263 210
264 211
265 212
213
215
216
20 266 216A
267 217
218
268 219
269 220
270 221
25 271 222
272 223
273 224
274 225
275 226
30 276 227
277 228
278 229
279 230
280 13
35 281 231
282 232
283
284 233
285 234
40 286 235
287 236
288 237
289 238
290 239
45 291 239A
379
Friendly Societies (Western Australia)
Bill 1998
Section of Friendly Societies Section of Financial Institutions
Code Code
292 240
293 241
294 242
295 243
5 296 244
297 245
298 246
299 247
300 248
10 301 249
302 250
303 251
304 252
305 253
15 306 254
307 255
308 256
309 -- 315
316 257
20 317 258
318 259
319
320 260
321 261
25 322 262
323 263
324 263A
325 263B
326 264
30 327 265
328 266
329 267
330 268
331 269
35 332 270
333 271
334 272
335 273
336 274
40 337 275
338 276
339 277
340 278
341 279
45 342 280
343 281
344 282
345 283
346 284
50 347 285
348 286
380
Friendly Societies (Western Australia)
Bill 1998
Section of Friendly Societies Section of Financial Institutions
Code Code
349 287
350 288
351 289
352 -- 359
5 360 290
361 291
362 291A
363 292
364 293
10 365 294
366 295
367 296
368 130
369 297
15 370 298
371 298A
372 298B
373 298C
374 299
20 375 300
301 -- 308
376 309
377 310
378 311
379 312
25 380 313
381 313A
382 313B
383 314
384 315
30 385 316
317
318
386 319
387 320
388 321
389 322
35 390 323
324 -- 333
391 334
392 335
336
393 -- 398
399 337
40 400 338
339
401 340
402 341
403 342
404 343
45 405 344
381
Friendly Societies (Western Australia)
Bill 1998
Section of Friendly Societies Section of Financial Institutions
Code Code
406 345
407
408
409 346
5 410 347
411 348
412 349
413 350
414 351
10 415 352
416 353
417 354
418 355
419 356
15 420 357
421 358
422 359
423 360
424 361
20 425 362
426 363
427 364
428
429
25 430
431
432 365
433 366
434 367
30 435 368
436 369
437
438 370
439 371
35 440 372
441 373
442 374
443 375
444 376
40 445 377
446 378
447 379
448 380
449 381
45 450 382
451 383
452 384
453 385
454 386
50 455 387
456 388
382
Friendly Societies (Western Australia)
Bill 1998
Section of Friendly Societies Section of Financial Institutions
Code Code
457 389
458 390
459 391
460 392
5 461 393
462 394
463 395
464 396
465 397
10 466 398
467 399
468 400
469 401
79 402
15 470 403
471 404
472 405
473 406
474 407
20 475 408
476 409
477 410
478 411
479 412
25 480 413
481 414
482 415
483
484 416
417
418
30 485 419
486 420
487 421
488 422
489 423
35 490 424
425
426
427
428
491 429
430 -- 435
492
493
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